USA Compression Partners, LP (NYSE: USAC) (“USA Compression” or
the “Partnership”) announced today its financial and operating
results for second-quarter 2023.
Second-Quarter 2023 Highlights
- Record total revenues of $206.9 million for second-quarter
2023, compared to $171.5 million for second-quarter 2022.
- Net income was $23.6 million for second-quarter 2023, compared
to $9.1 million for second-quarter 2022. Net income for
second-quarter 2023 includes a $14.6 million gain on derivative
instrument, partially offset by a $10.3 million non-cash impairment
of compression equipment.
- Net cash provided by operating activities was $87.9 million for
second-quarter 2023, compared to $94.2 million for second-quarter
2022.
- Adjusted EBITDA was $125.0 million for second-quarter 2023,
compared to $105.4 million for second-quarter 2022.
- Distributable Cash Flow was $67.0 million for second-quarter
2023, compared to $55.6 million for second-quarter 2022.
- Distributable Cash Flow Coverage was 1.30x for second-quarter
2023, compared to 1.08x for second-quarter 2022.
- Announced cash distribution of $0.525 per common unit for
second-quarter 2023, consistent with second-quarter 2022.
- Average horsepower utilization was 93.4% for second-quarter
2023, compared to 87.9% for second-quarter 2022.
- Average revenue per revenue-generating horsepower per month was
$18.65 for second-quarter 2023, compared to $17.20 for
second-quarter 2022.
“Our outstanding second-quarter results were driven by continued
strong market demand for our compression services, and our ability
to crisply and efficiently deploy our best-in-class
customer-service model. Our second-quarter results again featured
consecutive-quarter record-setting revenues, Adjusted EBITDA, and
Distributable Cash Flow,” commented Eric D. Long, USA Compression’s
President and Chief Executive Officer.
“These record quarterly results were driven by continued
sequential-quarter improvements to fleet utilization and
per-horsepower average revenue. Our second-quarter utilization exit
rate exceeded 93-percent for our fleet, which reached an all-time
high of approximately 3.35 million of revenue-generating
horsepower. These operational successes were complimented by
record-setting and demand-driven quarterly per-horsepower average
revenue of $18.65. We believe that our second-quarter performance
is the direct result of the quality of service that we deliver to
our customers and our returns-based capital-investment strategy. We
expect our high-quality customer service and capital discipline to
continue delivering financial results that enable further
reductions to our leverage ratio, which declined to approximately
4.5x as of quarter end, and that support continued improvements to
our distribution coverage, which came in at 1.30x for the second
quarter.”
Expansion capital expenditures were $71.6 million, maintenance
capital expenditures were $6.4 million, and cash interest expense,
net was $40.2 million for second-quarter 2023.
On July 13, 2023, the Partnership announced a second-quarter
cash distribution of $0.525 per common unit, which corresponds to
an annualized distribution rate of $2.10 per common unit. The
distribution will be paid on August 4, 2023, to common unitholders
of record as of the close of business on July 24, 2023.
Operational and Financial
Data
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Operational data:
Fleet horsepower (at period end) (1)
3,716,177
3,725,111
3,695,955
Revenue-generating horsepower (at period
end) (2)
3,346,657
3,260,535
3,048,498
Average revenue-generating horsepower
(3)
3,309,758
3,241,296
3,027,886
Revenue-generating compression units (at
period end)
4,220
4,170
4,014
Horsepower utilization (at period end)
(4)
93.7
%
92.7
%
88.4
%
Average horsepower utilization (for the
period) (4)
93.4
%
92.6
%
87.9
%
Financial data ($ in thousands, except
per horsepower data):
Total revenues
$
206,920
$
197,124
$
171,461
Average revenue per revenue-generating
horsepower per month (5)
$
18.65
$
18.19
$
17.20
Net income
$
23,584
$
10,941
$
9,086
Operating income
$
51,427
$
51,057
$
42,399
Net cash provided by operating
activities
$
87,871
$
42,338
$
94,228
Gross margin
$
76,959
$
70,973
$
57,344
Adjusted gross margin (6)
$
136,998
$
130,459
$
116,303
Adjusted gross margin percentage (7)
66.2
%
66.2
%
67.8
%
Adjusted EBITDA (6)
$
124,998
$
118,161
$
105,408
Adjusted EBITDA percentage (7)
60.4
%
59.9
%
61.5
%
Distributable Cash Flow (6)
$
67,038
$
62,613
$
55,576
Distributable Cash Flow Coverage Ratio
(6)
1.30x
1.21x
1.08x
____________________________________
(1)
Fleet horsepower is horsepower for
compression units that have been delivered to the Partnership (and
excludes units on order). As of June 30, 2023, the Partnership had
120,000 large horsepower on order for delivery, all of which is
expected to be delivered within the next twelve months and 95,000
large horsepower of which is expected to be delivered by year-end
2023.
(2)
Revenue-generating horsepower is
horsepower under contract for which the Partnership is billing a
customer.
(3)
Calculated as the average of the month-end
revenue-generating horsepower for each of the months in the
period.
(4)
Horsepower utilization is calculated as
(i) the sum of (a) revenue-generating horsepower; (b) horsepower in
the Partnership’s fleet that is under contract but is not yet
generating revenue; and (c) horsepower not yet in the Partnership’s
fleet that is under contract but not yet generating revenue and
that is subject to a purchase order, divided by (ii) total
available horsepower less idle horsepower that is under repair.
Horsepower utilization based on
revenue-generating horsepower and fleet horsepower was 90.1%,
87.5%, and 82.5% at June 30, 2023, March 31, 2023, and June 30,
2022, respectively.
Average horsepower utilization based on
revenue-generating horsepower and fleet horsepower was 89.0%,
87.2%, and 82.1% for the three months ended June 30, 2023, March
31, 2023, and June 30, 2022, respectively.
(5)
Calculated as the average of the result of
dividing the contractual monthly rate, excluding standby or other
temporary rates, for all units at the end of each month in the
period by the sum of the revenue-generating horsepower at the end
of each month in the period.
(6)
Adjusted gross margin, Adjusted EBITDA,
Distributable Cash Flow, and Distributable Cash Flow Coverage Ratio
are all non-U.S. generally accepted accounting principles
(“Non-GAAP”) financial measures. For the definition of each
measure, as well as reconciliations of each measure to its most
directly comparable financial measures calculated and presented in
accordance with GAAP, see “Non-GAAP Financial Measures” below.
(7)
Adjusted gross margin percentage and
Adjusted EBITDA percentage are calculated as a percentage of
revenue.
Liquidity and Long-Term
Debt
As of June 30, 2023, the Partnership was in compliance with all
covenants under its $1.6 billion revolving credit facility. As of
June 30, 2023, the Partnership had outstanding borrowings under the
revolving credit facility of $750.4 million, $849.6 million of
availability and, subject to compliance with the applicable
financial covenants, available borrowing capacity of $327.6
million. As of June 30, 2023, the outstanding aggregate principal
amount of the Partnership’s 6.875% senior notes due 2026 and 6.875%
senior notes due 2027 was $725.0 million and $750.0 million,
respectively.
Full-Year 2023 Outlook
USA Compression is confirming its full-year 2023 guidance as
follows:
- Net income range of $75.0 million to $95.0 million;
- A forward-looking estimate of net cash provided by operating
activities is not provided because the items necessary to estimate
net cash provided by operating activities, in particular the change
in operating assets and liabilities, are not accessible or
estimable at this time. The Partnership does not anticipate changes
in operating assets and liabilities to be material, but changes in
accounts receivable, accounts payable, accrued liabilities, and
deferred revenue could be significant, such that the amount of net
cash provided by operating activities would vary substantially from
the amount of projected Adjusted EBITDA and Distributable Cash
Flow;
- Adjusted EBITDA range of $490.0 million to $510.0 million;
and
- Distributable Cash Flow range of $260.0 million to $280.0
million.
Conference Call
The Partnership will host a conference call today beginning at
11:00 a.m. Eastern Time (10:00 a.m. Central Time) to discuss
second-quarter 2023 performance. The call will be broadcast live
over the internet. Investors may participate by audio webcast, or
if located in the U.S. or Canada, by phone. A replay will be
available shortly after the call via the “Events” page of USA
Compression’s Investor Relations website.
By Webcast:
Connect to the webcast via the “Events”
page of USA Compression’s Investor Relations website at
https://investors.usacompression.com. Please log in at least 10
minutes in advance to register and download any necessary
software.
By Phone:
Dial (888) 440-5655 at least 10 minutes
before the call and ask for the USA Compression Partners Earnings
Call or conference ID 8970064.
About USA Compression Partners,
LP
USA Compression Partners, LP is one of the nation’s largest
independent providers of natural gas compression services in terms
of total compression fleet horsepower. USA Compression partners
with a broad customer base composed of producers, processors,
gatherers, and transporters of natural gas and crude oil. USA
Compression focuses on providing midstream natural gas compression
services to infrastructure applications primarily in high-volume
gathering systems, processing facilities, and transportation
applications. More information is available at
usacompression.com.
Non-GAAP Financial
Measures
This news release includes the Non-GAAP financial measures of
Adjusted gross margin, Adjusted EBITDA, Distributable Cash Flow,
and Distributable Cash Flow Coverage Ratio.
Adjusted gross margin is defined as revenue less cost of
operations, exclusive of depreciation and amortization expense.
Management believes Adjusted gross margin is useful to investors as
a supplemental measure of the Partnership’s operating
profitability. Adjusted gross margin primarily is impacted by the
pricing trends for service operations and cost of operations,
including labor rates for service technicians, volume, and per-unit
costs for lubricant oils, quantity and pricing of routine
preventative maintenance on compression units, and property tax
rates on compression units. Adjusted gross margin should not be
considered an alternative to, or more meaningful than, gross margin
or any other measure presented in accordance with GAAP. Moreover,
the Partnership’s Adjusted gross margin, as presented, may not be
comparable to similarly titled measures of other companies. Because
the Partnership capitalizes assets, depreciation and amortization
of equipment is a necessary element of its cost structure. To
compensate for the limitations of Adjusted gross margin as a
measure of the Partnership’s performance, management believes it
important to consider gross margin determined under GAAP, as well
as Adjusted gross margin, to evaluate the Partnership’s operating
profitability.
Management views Adjusted EBITDA as one of its primary tools for
evaluating the Partnership’s results of operations, and the
Partnership tracks this item on a monthly basis as an absolute
amount and as a percentage of revenue compared to the prior month,
year-to-date, prior year, and budget. The Partnership defines
EBITDA as net income (loss) before net interest expense,
depreciation and amortization expense, and income tax expense
(benefit). The Partnership defines Adjusted EBITDA as EBITDA plus
impairment of compression equipment, impairment of goodwill,
interest income on capital leases, unit-based compensation expense
(benefit), severance charges, certain transaction expenses, loss
(gain) on disposition of assets, loss (gain) on derivative
instrument, and other. Adjusted EBITDA is used as a supplemental
financial measure by management and external users of the
Partnership’s financial statements, such as investors and
commercial banks, to assess:
- the financial performance of the Partnership’s assets without
regard to the impact of financing methods, capital structure, or
the historical cost basis of the Partnership’s assets;
- the viability of capital expenditure projects and the overall
rates of return on alternative investment opportunities;
- the ability of the Partnership’s assets to generate cash
sufficient to make debt payments and pay distributions; and
- the Partnership’s operating performance as compared to those of
other companies in its industry without regard to the impact of
financing methods and capital structure.
Management believes Adjusted EBITDA provides useful information
to investors because, when viewed in conjunction with the
Partnership’s GAAP results and the accompanying reconciliations, it
may provide a more complete assessment of the Partnership’s
performance as compared to considering solely GAAP results.
Management also believes that external users of the Partnership’s
financial statements benefit from having access to the same
financial measures that management uses to evaluate the results of
the Partnership’s business.
Adjusted EBITDA should not be considered an alternative to, or
more meaningful than, net income (loss), operating income (loss),
cash flows from operating activities, or any other measure
presented in accordance with GAAP. Moreover, the Partnership’s
Adjusted EBITDA, as presented, may not be comparable to similarly
titled measures of other companies.
Distributable Cash Flow is defined as net income (loss) plus
non-cash interest expense, non-cash income tax expense (benefit),
depreciation and amortization expense, unit-based compensation
expense (benefit), impairment of compression equipment, impairment
of goodwill, certain transaction expenses, severance charges, loss
(gain) on disposition of assets, change in fair value of derivative
instrument, proceeds from insurance recovery, and other, less
distributions on the Partnership’s Series A Preferred Units
(“Preferred Units”) and maintenance capital expenditures.
Distributable Cash Flow should not be considered an alternative
to, or more meaningful than, net income (loss), operating income
(loss), cash flows from operating activities, or any other measure
presented in accordance with GAAP. Moreover, the Partnership’s
Distributable Cash Flow, as presented, may not be comparable to
similarly titled measures of other companies.
Management believes Distributable Cash Flow is an important
measure of operating performance because it allows management,
investors, and others to compare the cash flows that the
Partnership generates (after distributions on the Partnership’s
Preferred Units but prior to any retained cash reserves established
by the Partnership’s general partner and the effect of the
Distribution Reinvestment Plan) to the cash distributions that the
Partnership expects to pay its common unitholders.
Distributable Cash Flow Coverage Ratio is defined as the
period’s Distributable Cash Flow divided by distributions declared
to common unitholders in respect of such period. Management
believes Distributable Cash Flow Coverage Ratio is an important
measure of operating performance because it permits management,
investors, and others to assess the Partnership’s ability to pay
distributions to common unitholders out of the cash flows the
Partnership generates. The Partnership’s Distributable Cash Flow
Coverage Ratio, as presented, may not be comparable to similarly
titled measures of other companies.
This news release also contains a forward-looking estimate of
Adjusted EBITDA and Distributable Cash Flow projected to be
generated by the Partnership for its 2023 fiscal year. A
forward-looking estimate of net cash provided by operating
activities and reconciliations of the forward-looking estimates of
Adjusted EBITDA and Distributable Cash Flow to net cash provided by
operating activities are not provided because the items necessary
to estimate net cash provided by operating activities, in
particular the change in operating assets and liabilities, are not
accessible or estimable at this time. The Partnership does not
anticipate changes in operating assets and liabilities to be
material, but changes in accounts receivable, accounts payable,
accrued liabilities, and deferred revenue could be significant,
such that the amount of net cash provided by operating activities
would vary substantially from the amount of projected Adjusted
EBITDA and Distributable Cash Flow.
See “Reconciliation of Non-GAAP Financial Measures” for Adjusted
gross margin reconciled to gross margin, Adjusted EBITDA reconciled
to net income and net cash provided by operating activities, and
net income and net cash provided by operating activities reconciled
to Distributable Cash Flow and Distributable Cash Flow Coverage
Ratio.
Forward-Looking
Statements
Some of the information in this news release may contain
forward-looking statements. These statements can be identified by
the use of forward-looking terminology including “may,” “believe,”
“expect,” “intend,” “anticipate,” “estimate,” “continue,” “if,”
“project,” “outlook,” “will,” “could,” “should,” or other similar
words or the negatives thereof, and include the Partnership’s
expectation of future performance contained herein, including as
described under “Full-Year 2023 Outlook.” These statements discuss
future expectations, contain projections of results of operations
or of financial condition, or state other “forward-looking”
information. You are cautioned not to place undue reliance on any
forward-looking statements, which can be affected by assumptions
used or by known risks or uncertainties. Consequently, no
forward-looking statements can be guaranteed. When considering
these forward-looking statements, you should keep in mind the risk
factors noted below and other cautionary statements in this news
release. The risk factors and other factors noted throughout this
news release could cause actual results to differ materially from
those contained in any forward-looking statement. Known material
factors that could cause the Partnership’s actual results to differ
materially from the results contemplated by such forward-looking
statements include:
- changes in general economic conditions, including inflation or
supply chain disruptions and changes in economic conditions of the
crude oil and natural gas industries, including any impact from the
ongoing military conflict involving Russia and Ukraine;
- changes in the long-term supply of and demand for crude oil and
natural gas, including as a result of the severity and duration of
world health events, related economic repercussions, actions taken
by governmental authorities and other third parties in response to
such events, and the resulting disruption in the oil and gas
industry and impact on demand for oil and gas;
- competitive conditions in the Partnership’s industry, including
competition for employees in a tight labor market;
- changes in the availability and cost of capital, including
changes to interest rates;
- renegotiation of material terms of customer contracts;
- actions taken by the Partnership’s customers, competitors, and
third-party operators;
- operating hazards, natural disasters, epidemics, pandemics,
weather-related impacts, casualty losses, and other matters beyond
the Partnership’s control;
- the deterioration of the financial condition of the
Partnership’s customers, which may result in the initiation of
bankruptcy proceedings with respect to certain customers;
- the restrictions on the Partnership’s business that are imposed
under the Partnership’s long-term debt agreements;
- information technology risks including the risk from
cyberattacks, cybersecurity breaches, and other disruptions to our
information systems;
- the effects of existing and future laws and governmental
regulations;
- the effects of future litigation;
- the Partnership’s ability to realize the anticipated benefits
of acquisitions;
- factors described in Part I, Item 1A (“Risk Factors”) of the
Partnership’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2022, which was filed with the Securities and Exchange
Commission (the “SEC”) on February 14, 2023, Part II, Item 1A
(“Risk Factors”) of the Partnership’s Quarterly Report on Form 10-Q
for the quarter ended March 31, 2023, which was filed with the SEC
on May 2, 2023, and subsequently filed reports; and
- other factors discussed in the Partnership’s filings with the
SEC.
All forward-looking statements speak only as of the date of this
news release and are expressly qualified in their entirety by the
foregoing cautionary statements. Unless legally required, the
Partnership undertakes no obligation to update publicly any
forward-looking statements, whether as a result of new information,
future events, or otherwise. Unpredictable or unknown factors not
discussed herein also could have material adverse effects on
forward-looking statements.
USA COMPRESSION PARTNERS,
LP
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except for per
unit amounts – Unaudited)
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Revenues:
Contract operations
$
196,982
$
188,539
$
163,969
Parts and service
4,102
3,878
3,605
Related party
5,836
4,707
3,887
Total revenues
206,920
197,124
171,461
Costs and expenses:
Cost of operations, exclusive of
depreciation and amortization
69,922
66,665
55,158
Depreciation and amortization
60,039
59,486
58,959
Selling, general, and administrative
14,950
19,101
13,914
Loss (gain) on disposition of assets
309
(376
)
1,031
Impairment of compression equipment
10,273
1,191
—
Total costs and expenses
155,493
146,067
129,062
Operating income
51,427
51,057
42,399
Other income (expense):
Interest expense, net
(42,045
)
(39,790
)
(33,079
)
Gain on derivative instrument
14,550
—
—
Other
57
24
21
Total other expense
(27,438
)
(39,766
)
(33,058
)
Net income before income tax expense
23,989
11,291
9,341
Income tax expense
405
350
255
Net income
23,584
10,941
9,086
Less: distributions on Preferred Units
(12,188
)
(12,187
)
(12,188
)
Net income (loss) attributable to common
unitholders’ interests
$
11,396
$
(1,246
)
$
(3,102
)
Weighted-average common units outstanding
– basic
98,271
98,247
97,728
Weighted-average common units outstanding
– diluted
99,694
98,247
97,728
Basic net income (loss) per common
unit
$
0.12
$
(0.01
)
$
(0.03
)
Diluted net income (loss) per common
unit
$
0.11
$
(0.01
)
$
(0.03
)
Distributions declared per common unit for
respective periods
$
0.525
$
0.525
$
0.525
USA COMPRESSION PARTNERS,
LP
SELECTED BALANCE SHEET
DATA
(In thousands, except unit
amounts – Unaudited)
June 30, 2023
Selected Balance Sheet data:
Total assets
$
2,691,038
Long-term debt, net
$
2,212,792
Total partners’ deficit
$
(208,190
)
Common units outstanding
98,278,456
USA COMPRESSION PARTNERS,
LP
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands —
Unaudited)
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Net cash provided by operating
activities
$
87,871
$
42,338
$
94,228
Net cash used in investing activities
(64,448
)
(40,861
)
(23,156
)
Net cash used in financing activities
(23,398
)
(1,506
)
(71,087
)
USA COMPRESSION PARTNERS,
LP
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
ADJUSTED GROSS MARGIN TO GROSS
MARGIN
(In thousands —
Unaudited)
The following table reconciles Adjusted
gross margin to gross margin, its most directly comparable GAAP
financial measure, for each of the periods presented:
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Total revenues
$
206,920
$
197,124
$
171,461
Cost of operations, exclusive of
depreciation and amortization
(69,922
)
(66,665
)
(55,158
)
Depreciation and amortization
(60,039
)
(59,486
)
(58,959
)
Gross margin
$
76,959
$
70,973
$
57,344
Depreciation and amortization
60,039
59,486
58,959
Adjusted gross margin
$
136,998
$
130,459
$
116,303
USA COMPRESSION PARTNERS,
LP
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
ADJUSTED EBITDA TO NET INCOME
AND NET CASH PROVIDED BY OPERATING ACTIVITIES
(In thousands —
Unaudited)
The following table reconciles Adjusted
EBITDA to net income and net cash provided by operating activities,
its most directly comparable GAAP financial measures, for each of
the periods presented:
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Net income
$
23,584
$
10,941
$
9,086
Interest expense, net
42,045
39,790
33,079
Depreciation and amortization
60,039
59,486
58,959
Income tax expense
405
350
255
EBITDA
$
126,073
$
110,567
$
101,379
Unit-based compensation expense (1)
2,849
6,779
2,998
Severance charges
44
—
—
Loss (gain) on disposition of assets
309
(376
)
1,031
Gain on derivative instrument
(14,550
)
—
—
Impairment of compression equipment
(2)
10,273
1,191
—
Adjusted EBITDA
$
124,998
$
118,161
$
105,408
Interest expense, net
(42,045
)
(39,790
)
(33,079
)
Non-cash interest expense
1,819
1,822
1,815
Income tax expense
(405
)
(350
)
(255
)
Severance charges
(44
)
—
—
Cash received on derivative instrument
1,216
—
—
Other
34
(15
)
(179
)
Changes in operating assets and
liabilities
2,298
(37,490
)
20,518
Net cash provided by operating
activities
$
87,871
$
42,338
$
94,228
____________________________________
(1)
For the three months ended June
30, 2023, March 31, 2023, and June 30, 2022, unit-based
compensation expense included $1.1 million, $1.1 million, and $1.2
million, respectively, of cash payments related to quarterly
payments of distribution equivalent rights on outstanding phantom
unit awards. The remainder of unit-based compensation expense for
all periods was related to non-cash adjustments to the unit-based
compensation liability.
(2)
Represents non-cash charges
incurred to decrease the carrying value of long-lived assets with
recorded values that are not expected to be recovered through
future cash flows.
USA COMPRESSION PARTNERS,
LP
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
DISTRIBUTABLE CASH FLOW TO NET
INCOME AND NET CASH PROVIDED BY OPERATING ACTIVITIES
(Dollars in thousands —
Unaudited)
The following table reconciles
Distributable Cash Flow to net income and net cash provided by
operating activities, its most directly comparable GAAP financial
measures, for each of the periods presented:
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Net income
$
23,584
$
10,941
$
9,086
Non-cash interest expense
1,819
1,822
1,815
Depreciation and amortization
60,039
59,486
58,959
Non-cash income tax expense (benefit)
34
(15
)
21
Unit-based compensation expense (1)
2,849
6,779
2,998
Severance charges
44
—
—
Loss (gain) on disposition of assets
309
(376
)
1,031
Change in fair value of derivative
instrument
(13,334
)
—
—
Impairment of compression equipment
(2)
10,273
1,191
—
Distributions on Preferred Units
(12,188
)
(12,187
)
(12,188
)
Maintenance capital expenditures (3)
(6,391
)
(5,028
)
(6,146
)
Distributable Cash Flow
$
67,038
$
62,613
$
55,576
Maintenance capital expenditures
6,391
5,028
6,146
Severance charges
(44
)
—
—
Distributions on Preferred Units
12,188
12,187
12,188
Other
—
—
(200
)
Changes in operating assets and
liabilities
2,298
(37,490
)
20,518
Net cash provided by operating
activities
$
87,871
$
42,338
$
94,228
Distributable Cash Flow
$
67,038
$
62,613
$
55,576
Distributions for Distributable Cash Flow
Coverage Ratio (4)
$
51,596
$
51,585
$
51,419
Distributable Cash Flow Coverage Ratio
1.30x
1.21x
1.08x
____________________________________
(1)
For the three months ended June
30, 2023, March 31, 2023, and June 30, 2022, unit-based
compensation expense included $1.1 million, $1.1 million, and $1.2
million, respectively, of cash payments related to quarterly
payments of distribution equivalent rights on outstanding phantom
unit awards. The remainder of unit-based compensation expense for
all periods was related to non-cash adjustments to the unit-based
compensation liability.
(2)
Represents non-cash charges
incurred to decrease the carrying value of long-lived assets with
recorded values that are not expected to be recovered through
future cash flows.
(3)
Reflects actual maintenance
capital expenditures for the periods presented. Maintenance capital
expenditures are capital expenditures made to maintain the
operating capacity of the Partnership’s assets and extend their
useful lives, replace partially or fully depreciated assets, or
other capital expenditures that are incurred in maintaining the
Partnership’s existing business and related cash flow.
(4)
Represents distributions to the
holders of the Partnership’s common units as of the record
date.
USA COMPRESSION PARTNERS,
LP
FULL-YEAR 2023 ADJUSTED EBITDA
AND DISTRIBUTABLE CASH FLOW GUIDANCE RANGE
RECONCILIATION TO NET
INCOME
(Unaudited)
Guidance
Net income
$75.0 million to $95.0
million
Plus: Interest expense, net
163.0 million
Plus: Depreciation and amortization
237.0 million
Plus: Income tax expense
2.0 million
EBITDA
$477.0 million to $497.0
million
Plus: Unit-based compensation expense and
other (1)
16.1 million
Plus: Impairment of compression
equipment
11.5 million
Less: Gain on derivative instrument
14.6 million
Adjusted EBITDA
$490.0 million to $510.0
million
Less: Cash interest expense
157.0 million
Less: Current income tax expense
2.0 million
Less: Maintenance capital expenditures
25.0 million
Less: Distributions on Preferred Units
49.0 million
Plus: Cash received on derivative
instrument
3.0 million
Distributable Cash Flow
$260.0 million to $280.0
million
____________________________________
(1)
Unit-based compensation expense is based
on the Partnership’s closing per unit price of $19.74 on June 30,
2023.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230801000219/en/
Investor Contacts:
USA Compression Partners, LP
Mike Pearl, Chief Financial Officer (832) 823-7306
Julie McEwen, Controller (512) 369-1389
ir@usacompression.com
USA Compression Partners (NYSE:USAC)
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