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USA Compression Partners, LP Reports Fourth Quarter and Full-Year 2017 Results; Provides 2018 Outlook AUSTIN, Texas
USA Compression Partners, LP (NYSE: USAC) (“USA Compression” or the
“Partnership”) announced today its financial and operating results for
the fourth quarter and full-year 2017. Net income was $4.5 million for
the fourth quarter of 2017, compared to $4.8 million for the third
quarter of 2017 and $3.3 million for the fourth quarter of 2016. Net
cash provided by operating activities was $39.3 million for the fourth
quarter of 2017, compared to $33.0 million for the third quarter of 2017
and $9.1 million for the fourth quarter of 2016.
Adjusted EBITDA was $42.1 million for the fourth quarter of 2017,
compared to $40.8 million for the third quarter of 2017 and $36.5
million for the fourth quarter of 2016. Distributable Cash Flow was
$33.2 million for the fourth quarter of 2017 compared to $30.8 million
for the third quarter of 2017 and $28.7 million for the fourth quarter
of 2016.
“As it regards our fourth quarter performance, USA Compression ended the
year with continued growth, with contract compression service revenues
up more than 5% over the third quarter and average revenue generating
horsepower increasing over 50,000 horsepower compared to the third
quarter,” said Eric D. Long, USA Compression’s President and Chief
Executive Officer. “Over the course of 2017, we continued to deploy
units and now have approximately 240,000 more revenue-generating
horsepower out in the field than we did a year ago. Our primary focus on
infrastructure applications and our team’s efforts at redeploying idle
equipment has resulted in increased fleet utilization – approaching 95%
by the end of 2017. Adjusted EBITDA and Distributable Cash Flow were
also both up quarter-over-quarter.”
“For 2018, we have made commitments to take delivery of approximately
150,000 horsepower throughout the year, the majority of which consist of
very large horsepower units already committed to customers or under
contract with customers,” he said. “The improving performance resulted
in leverage of 4.65x and improved total coverage for the quarter at
0.99x.”
“In January, we announced a series of transactions which will result,
among other things, in USA Compression acquiring the CDM Resource
Management business from Energy Transfer Partners and Energy Transfer
Equity acquiring USA Compression’s general partner. We expect these
transactions to be accretive to USA Compression’s Distributable Cash
Flow and continue to expect these transactions to close in the first
half of 2018. We will provide additional information as we are able to,”
he concluded.
Average revenue generating horsepower was 1,602,365 for the fourth
quarter of 2017, compared to 1,548,656 for the third quarter of 2017 and
1,366,371 for the fourth quarter of 2016. Average revenue per revenue
generating horsepower per month was $15.21 for the fourth quarter of
2017, compared to $15.13 for the third quarter of 2017 and $15.07 for
the fourth quarter of 2016.
Revenues were $75.4 million for the fourth quarter of 2017, compared to
$72.8 million for the third quarter of 2017 and $74.9 million for the
fourth quarter of 2016. Gross operating margin was $50.3 million for the
fourth quarter of 2017, compared to $49.4 million for the third quarter
of 2017 and $45.1 million for the fourth quarter of 2016. Gross
operating margin as a percentage of total revenues was 66.8% for the
fourth quarter of 2017, compared to 67.8% for the third quarter of 2017
and 60.2% for the fourth quarter of 2016. Operating income was $11.5
million for the fourth quarter of 2017, consistent with $11.5 million
for the third quarter of 2017 and compared to $8.9 million for the
fourth quarter of 2016.
Expansion capital expenditures were $50.6 million, maintenance capital
expenditures were $2.2 million and cash interest expense, net was $6.3
million for the fourth quarter of 2017.
On January 18, 2018, the Partnership announced a cash distribution of
$0.525 per unit on its common units. This fourth quarter distribution
corresponds to an annualized distribution rate of $2.10 per unit. The
distribution will be paid on February 14, 2018 to unitholders of record
as of the close of business on February 2, 2018. USA Compression
Holdings, LLC, the owner of approximately 40% of the Partnership’s
outstanding limited partner interests, elected not to reinvest any part
of this distribution with respect to its units pursuant to the
Partnership’s Distribution Reinvestment Plan (the “DRIP”). For the
fourth quarter of 2017, the Partnership’s Distributable Cash Flow
Coverage Ratio was 0.99x and Cash Coverage Ratio was 1.00x.
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Operational and Financial Data
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Three Months Ended
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Year Ended
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December 31,
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September 30,
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December 31,
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December 31,
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2017
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2017
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2016
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2017
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2016
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Operational Data
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Fleet Horsepower (at period end)
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1,799,781
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1,757,720
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1,720,547
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1,799,781
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1,720,547
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Revenue Generating Horsepower (at period end)
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1,624,377
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1,557,825
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1,387,073
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1,624,377
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1,387,073
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Average Revenue Generating Horsepower
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1,602,365
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1,548,656
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1,366,371
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1,505,657
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1,377,966
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Revenue Generating Compression Units (at period end)
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2,830
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2,793
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2,552
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2,830
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2,552
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Horsepower Utilization (at period end) (1)
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94.8
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%
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94.2
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%
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87.1
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%
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94.8
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%
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87.1
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%
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Average Horsepower Utilization (for the period) (1)
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94.7
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%
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94.1
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%
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87.4
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%
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92.0
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%
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87.4
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%
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Financial Data ($ in thousands, except per
horsepower data)
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Revenue
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$
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75,385
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$
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72,791
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$
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74,913
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$
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280,222
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$
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265,921
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Average Revenue Per Revenue Generating Horsepower Per Month (2)
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$
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15.21
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$
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15.13
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$
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15.07
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$
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15.07
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$
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15.41
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Net income
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$
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4,546
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$
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4,789
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$
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3,269
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$
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11,440
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$
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12,935
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Operating income
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$
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11,527
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$
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11,508
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$
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8,894
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$
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37,080
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$
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34,408
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Net cash provided by operating activities
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$
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39,343
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$
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33,029
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$
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9,101
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$
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124,644
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$
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103,697
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Gross Operating Margin (3)
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$
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50,340
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$
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49,350
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$
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45,120
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$
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187,631
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$
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177,760
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Gross Operating Margin Percentage
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66.8%
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67.8%
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60.2%
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67.0%
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66.8%
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Adjusted EBITDA (3)
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$
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42,111
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$
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40,849
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$
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36,461
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$
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155,703
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$
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146,648
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Adjusted EBITDA Percentage
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55.9%
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56.1%
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48.7%
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55.6%
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55.1%
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Distributable Cash Flow (3)
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$
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33,223
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$
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30,811
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$
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28,703
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$
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118,330
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$
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118,329
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______________________________________
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(1)
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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, not yet generating revenue and is subject to a purchase
order, divided by (ii) total available horsepower less idle
horsepower that is under repair.
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Horsepower utilization based on revenue generating horsepower and
fleet horsepower at each applicable period end was 90.3%, 88.6% and
80.6% for the quarters ended December 31, 2017, September 30, 2017
and December 31, 2016, respectively, and 90.3% and 80.6% for the
years ended December 31, 2017 and 2016, respectively.
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Average horsepower utilization based on revenue generating
horsepower and fleet horsepower was 90.0%, 88.4% and 79.4% for the
quarters ended December 31, 2017, September 30, 2017 and December
31, 2016, respectively, and 85.9% and 80.3% for the years ended
December 31, 2017 and 2016, respectively.
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(2)
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Calculated as the average of the result of dividing the contractual
monthly rate 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.
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(3)
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Gross operating margin, Adjusted EBITDA and Distributable Cash Flow
are all non-U.S. generally accepted accounting principles
(“Non-GAAP”) financial measures. For the definition of each measure,
see “Non-GAAP Financial Measures” below.
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Liquidity and Credit Facility
As of December 31, 2017, the Partnership was in compliance with all
covenants under its $1.1 billion revolving credit facility. As of
December 31, 2017, the outstanding balance under the revolving credit
facility, which matures in 2020, was $782.9 million.
Full-Year 2018 Outlook
USA Compression is providing its full-year 2018 guidance as follows:
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Net income range of $30.0 million to $40.0 million;
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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 the 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;
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Adjusted EBITDA range of $180.0 million to $190.0 million; and
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Distributable Cash Flow range of $130.0 million to $140.0 million.
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Please note this 2018 guidance does not include any effects from the
USA Compression announcement made on January 16, 2018 to acquire the
CDM Resource Management business from Energy Transfer Partners and
Energy Transfer Equity acquiring USA Compression’s general partner.
The series of transactions, as discussed in the announcement, are
expected to close during the first half of 2018, subject to closing
conditions.
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 fourth
quarter and full-year 2017 performance. The call will be broadcast live
over the Internet. Investors may participate either by phone or audio
webcast.
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By Phone:
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Dial 800-281-7973 inside the U.S. and Canada at least 10 minutes
before the call and ask for the USA Compression Partners Earnings
Call. Investors outside the U.S. and Canada should dial
323-794-2093. The conference ID for both is 7346137.
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A replay of the call will be available through February 23, 2018.
Callers inside the U.S. and Canada may access the replay by dialing
888-203-1112. Investors outside the U.S. and Canada should dial
719-457-0820. The conference ID for both is 7346137.
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By Webcast:
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Connect to the webcast via the “Events” page of USA Compression’s
Investor Relations website at http://investors.usacompression.com.
Please log in at least 10 minutes in advance to register and
download any necessary software. A replay will be available
shortly after the call.
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About USA Compression Partners, LP
USA Compression Partners, LP is a growth-oriented Delaware limited
partnership that is one of the nation’s largest independent providers of
compression services in terms of total compression fleet horsepower. The
Partnership partners with a broad customer base composed of producers,
processors, gatherers and transporters of natural gas and crude oil. The
Partnership focuses on providing 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
EBITDA, gross operating margin, Distributable Cash Flow, Distributable
Cash Flow Coverage Ratio and Cash Coverage Ratio.
Management views Adjusted EBITDA as one of its primary management tools,
and the Partnership tracks this item on a monthly basis both 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. The Partnership
defines Adjusted EBITDA as EBITDA plus impairment of compression
equipment, impairment of goodwill, interest income on capital lease,
unit-based compensation expense, severance charges, certain transaction
fees, loss (gain) on disposition of assets and other. Adjusted EBITDA is
used as a supplemental financial measure by management and external
users of its financial statements, such as investors and commercial
banks, to assess:
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the financial performance of the Partnership’s assets without regard
to the impact of financing methods, capital structure or historical
cost basis of the Partnership’s assets;
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the viability of capital expenditure projects and the overall rates of
return on alternative investment opportunities;
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the ability of the Partnership’s assets to generate cash sufficient to
make debt payments and to make distributions; and
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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 that Adjusted EBITDA provides useful information to
investors because, when viewed with U.S. generally accepted accounting
principles (“GAAP”) results and the accompanying reconciliations, it
provides a more complete understanding of the Partnership’s performance
than GAAP results alone. Management also believes that external users of
its financial statements benefit from having access to the same
financial measures that management uses in evaluating 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 of financial performance
or liquidity presented in accordance with GAAP as measures of operating
performance and liquidity. Moreover, Adjusted EBITDA as presented may
not be comparable to similarly titled measures of other companies.
Gross operating margin is defined as revenue less cost of operations,
exclusive of depreciation and amortization expense. Management believes
that gross operating margin is useful as a supplemental measure of the
Partnership’s operating profitability. Gross operating margin is
impacted primarily 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. Gross operating margin should not be considered an
alternative to, or more meaningful than, operating income (loss), its
most directly comparable GAAP financial measure, or any other measure of
financial performance presented in accordance with GAAP. Moreover, gross
operating 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
costs. To compensate for the limitations of gross operating margin as a
measure of the Partnership’s performance, management believes that it is
important to consider operating income (loss) determined under GAAP, as
well as gross operating margin, to evaluate the Partnership’s operating
profitability. A reconciliation of gross operating margin to operating
income is provided in this news release.
Distributable Cash Flow is defined as net income (loss) plus non-cash
interest expense, non-cash income tax expense, depreciation and
amortization expense, unit-based compensation expense, impairment of
compression equipment, impairment of goodwill, certain transaction fees,
severance charges, loss (gain) on disposition of assets, proceeds from
insurance recovery and other, less maintenance capital expenditures.
Distributable Cash Flow should not be considered as an alternative to,
or more meaningful than, net income (loss), operating income (loss),
cash flows from operating activities or any other measure of financial
performance presented in accordance with GAAP as measures of operating
performance and liquidity. Moreover, our 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 such measure allows management, investors
and others to compare basic cash flows the Partnership generates (prior
to any retained cash reserves established by the Partnership’s general
partner and the effect of the DRIP) to the cash distributions the
Partnership expects to pay its unitholders.
Distributable Cash Flow Coverage Ratio, a non-GAAP measure, is defined
as Distributable Cash Flow less cash distributions to be paid to the
Partnership’s general partner and incentive distribution rights (“IDRs”)
in respect of such period, divided by distributions declared to limited
partner unitholders in respect of such period. Cash Coverage Ratio is
defined as Distributable Cash Flow less cash distributions to be paid to
the Partnership’s general partner and IDRs in respect of such period,
divided by cash distributions expected to be paid to limited partner
unitholders in respect of such period, after taking into account the
non-cash impact of the DRIP. Management believes Distributable Cash Flow
Coverage Ratio and Cash Coverage Ratio are important measures of
operating performance because they allow management, investors and
others to gauge the Partnership’s ability to pay cash distributions to
limited partner unitholders using the cash flows the Partnership
generates. The Partnership’s Distributable Cash Flow Coverage Ratio and
Cash 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 in its 2018 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 the 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 EBITDA
reconciled to net income (loss) and net cash provided by operating
activities, and net income (loss) and net cash provided by operating
activities reconciled to Distributable Cash Flow, Distributable Cash
Flow Coverage Ratio and Cash 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,” or other similar words,
and include the Partnership’s expectation of future performance
contained herein, including as described under “Full-Year 2018 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 are 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, 2017, which the Partnership
expects to file with the Securities and Exchange Commission on or before
the March 16, 2018 deadline, and include:
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changes in general economic conditions and changes in economic
conditions of the crude oil and natural gas industry specifically;
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competitive conditions in the industry;
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changes in the long-term supply of and demand for crude oil and
natural gas;
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our ability to realize the anticipated benefits of acquisitions and to
integrate acquired assets with our existing fleet, including the CDM
Acquisition;
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actions taken by the Partnership’s customers, competitors and
third-party operators;
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the deterioration of the financial condition of our customers;
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changes in the availability and cost of capital;
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operating hazards, natural disasters, weather-related delays, casualty
losses and other matters beyond the Partnership’s control;
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the effects of existing and future laws and governmental regulations;
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the effects of future litigation;
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the failure to consummate the CDM Acquisition; and
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other factors discussed in the Partnership’s filings with the
Securities and Exchange Commission.
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.
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USA COMPRESSION PARTNERS, LP
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(In thousands, except for per unit amounts — Unaudited)
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Three Months Ended
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Year Ended
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December 31,
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September 30,
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December 31,
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December 31,
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2017
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2017
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2016
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2017
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2016
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Revenues:
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Contract operations
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$
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72,151
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$
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68,407
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$
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59,605
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$
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264,315
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$
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246,950
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Parts and service
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3,234
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4,384
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15,308
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15,907
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18,971
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Total revenues
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75,385
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72,791
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74,913
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280,222
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265,921
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Cost of operations, exclusive of depreciation and amortization
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25,045
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23,441
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29,793
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92,591
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88,161
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Gross operating margin
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50,340
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49,350
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45,120
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187,631
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177,760
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Other operating and administrative costs and expenses:
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Selling, general and administrative
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13,840
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11,888
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10,987
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47,483
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44,483
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Depreciation and amortization
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25,110
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24,808
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23,636
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98,603
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92,337
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Loss (gain) on disposition of assets
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(300)
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50
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(23)
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(507)
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772
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Impairment of compression equipment
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163
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1,096
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1,626
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4,972
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5,760
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Total other operating and administrative costs and expenses
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38,813
|
|
|
37,842
|
|
|
36,226
|
|
|
150,551
|
|
|
143,352
|
|
Operating income
|
|
|
11,527
|
|
|
11,508
|
|
|
8,894
|
|
|
37,080
|
|
|
34,408
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
|
(6,896)
|
|
|
(6,557)
|
|
|
(5,611)
|
|
|
(25,129)
|
|
|
(21,087)
|
|
Other
|
|
|
5
|
|
|
3
|
|
|
5
|
|
|
27
|
|
|
35
|
|
Total other expense
|
|
|
(6,891)
|
|
|
(6,554)
|
|
|
(5,606)
|
|
|
(25,102)
|
|
|
(21,052)
|
|
Net income before income tax expense
|
|
|
4,636
|
|
|
4,954
|
|
|
3,288
|
|
|
11,978
|
|
|
13,356
|
|
Income tax expense
|
|
|
90
|
|
|
165
|
|
|
19
|
|
|
538
|
|
|
421
|
|
Net income
|
|
$
|
4,546
|
|
$
|
4,789
|
|
$
|
3,269
|
|
$
|
11,440
|
|
$
|
12,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) allocated to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General partner's interest in net income
|
|
$
|
397
|
|
$
|
399
|
|
$
|
345
|
|
$
|
1,493
|
|
$
|
1,364
|
|
Common unitholders' interest in net income
|
|
$
|
4,149
|
|
$
|
4,390
|
|
$
|
2,924
|
|
$
|
9,947
|
|
$
|
14,282
|
|
Subordinated unitholders' interest in net loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(2,711)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common units outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
62,117
|
|
|
61,815
|
|
|
56,415
|
|
|
61,555
|
|
|
53,043
|
|
Diluted
|
|
|
62,526
|
|
|
62,084
|
|
|
56,739
|
|
|
61,835
|
|
|
53,344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average subordinated units outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,766
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net income per common unit
|
|
$
|
0.07
|
|
$
|
0.07
|
|
$
|
0.05
|
|
$
|
0.16
|
|
$
|
0.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per subordinated unit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.54)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions declared per limited partner unit in respective periods
|
|
$
|
0.525
|
|
$
|
0.525
|
|
$
|
0.525
|
|
$
|
2.10
|
|
$
|
2.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USA COMPRESSION PARTNERS, LP
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In thousands — Unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
|
|
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net cash provided by operating activities
|
|
$
|
39,343
|
|
$
|
33,029
|
|
$
|
9,101
|
|
$
|
124,644
|
|
$
|
103,697
|
|
Net cash used in investing activities
|
|
|
(40,147)
|
|
|
(32,484)
|
|
|
(4,964)
|
|
|
(105,231)
|
|
|
(50,831)
|
|
Net cash provided by (used in) financing activities
|
|
|
(72)
|
|
|
59
|
|
|
(4,079)
|
|
|
(19,431)
|
|
|
(52,808)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
Year Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
|
|
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net income
|
|
$
|
4,546
|
|
$
|
4,789
|
|
$
|
3,269
|
|
$
|
11,440
|
|
$
|
12,935
|
|
Interest expense, net
|
|
|
6,896
|
|
|
6,557
|
|
|
5,611
|
|
|
25,129
|
|
|
21,087
|
|
Depreciation and amortization
|
|
|
25,110
|
|
|
24,808
|
|
|
23,636
|
|
|
98,603
|
|
|
92,337
|
|
Income tax expense
|
|
|
90
|
|
|
165
|
|
|
19
|
|
|
538
|
|
|
421
|
|
EBITDA
|
|
$
|
36,642
|
|
$
|
36,319
|
|
$
|
32,535
|
|
$
|
135,710
|
|
$
|
126,780
|
|
Impairment of compression equipment
|
|
|
163
|
|
|
1,096
|
|
|
1,626
|
|
|
4,972
|
|
|
5,760
|
|
Interest income on capital lease
|
|
|
372
|
|
|
399
|
|
|
407
|
|
|
1,610
|
|
|
1,492
|
|
Unit-based compensation expense (1)
|
|
|
3,548
|
|
|
2,813
|
|
|
1,892
|
|
|
11,708
|
|
|
10,373
|
|
Transaction expenses for acquisitions (2)
|
|
|
1,406
|
|
|
—
|
|
|
(56)
|
|
|
1,406
|
|
|
894
|
|
Severance charges
|
|
|
22
|
|
|
172
|
|
|
80
|
|
|
314
|
|
|
577
|
|
Other
|
|
|
258
|
|
|
—
|
|
|
—
|
|
|
490
|
|
|
—
|
|
Loss (gain) on disposition of assets
|
|
|
(300)
|
|
|
50
|
|
|
(23)
|
|
|
(507)
|
|
|
772
|
|
Adjusted EBITDA
|
|
$
|
42,111
|
|
$
|
40,849
|
|
$
|
36,461
|
|
$
|
155,703
|
|
$
|
146,648
|
|
Interest expense, net
|
|
|
(6,896)
|
|
|
(6,557)
|
|
|
(5,611)
|
|
|
(25,129)
|
|
|
(21,087)
|
|
Income tax expense
|
|
|
(90)
|
|
|
(165)
|
|
|
(19)
|
|
|
(538)
|
|
|
(421)
|
|
Interest income on capital lease
|
|
|
(372)
|
|
|
(399)
|
|
|
(407)
|
|
|
(1,610)
|
|
|
(1,492)
|
|
Non-cash interest expense
|
|
|
545
|
|
|
547
|
|
|
547
|
|
|
2,186
|
|
|
2,108
|
|
Transaction expenses for acquisitions
|
|
|
(1,406)
|
|
|
—
|
|
|
56
|
|
|
(1,406)
|
|
|
(894)
|
|
Severance charges
|
|
|
(22)
|
|
|
(172)
|
|
|
(80)
|
|
|
(314)
|
|
|
(577)
|
|
Other
|
|
|
(258)
|
|
|
—
|
|
|
—
|
|
|
(490)
|
|
|
—
|
|
Changes in operating assets and liabilities
|
|
|
5,731
|
|
|
(1,074)
|
|
|
(21,846)
|
|
|
(3,758)
|
|
|
(20,588)
|
|
Net cash provided by operating activities
|
|
$
|
39,343
|
|
$
|
33,029
|
|
$
|
9,101
|
|
$
|
124,644
|
|
$
|
103,697
|
|
___________________________
|
|
(1)
|
|
For the quarters ended December 31, 2017, September 30, 2017 and
December 31, 2016, unit-based compensation expense included $0.5
million, $0.6 million, and $0.6 million, respectively, of cash
payments related to quarterly payments of distribution equivalent
rights on outstanding phantom unit awards. For the years ended
December 31, 2017 and 2016, unit-based compensation expense included
$2.5 million and $2.8 million, respectively, of cash payments
related to quarterly payments of distribution equivalent rights on
outstanding phantom unit awards and $0.4 million and $0.1 million,
respectively, related to the cash portion of any settlement of
phantom unit awards upon vesting. The remainder of the unit-based
compensation expense for each period presented in 2017 and 2016 was
related to non-cash adjustments to the unit-based compensation
liability.
|
|
|
|
|
|
(2)
|
|
Represents certain transaction expenses related to potential
acquisitions. The Partnership believes it is useful to investors to
exclude these fees.
|
|
|
|
|
|
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
|
|
Year Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
|
|
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net income
|
|
$
|
4,546
|
|
$
|
4,789
|
|
$
|
3,269
|
|
$
|
11,440
|
|
$
|
12,935
|
|
Plus: Non-cash interest expense
|
|
|
545
|
|
|
547
|
|
|
547
|
|
|
2,186
|
|
|
2,108
|
|
Plus: Non-cash income tax expense
|
|
|
90
|
|
|
59
|
|
|
31
|
|
|
278
|
|
|
239
|
|
Plus: Depreciation and amortization
|
|
|
25,110
|
|
|
24,808
|
|
|
23,636
|
|
|
98,603
|
|
|
92,337
|
|
Plus: Unit-based compensation expense (1)
|
|
|
3,548
|
|
|
2,813
|
|
|
1,892
|
|
|
11,708
|
|
|
10,373
|
|
Plus: Impairment of compression equipment
|
|
|
163
|
|
|
1,096
|
|
|
1,626
|
|
|
4,972
|
|
|
5,760
|
|
Plus: Transaction expenses for acquisitions (2)
|
|
|
1,406
|
|
|
—
|
|
|
(56)
|
|
|
1,406
|
|
|
894
|
|
Plus: Severance charges
|
|
|
22
|
|
|
172
|
|
|
80
|
|
|
314
|
|
|
577
|
|
Plus: Other
|
|
|
258
|
|
|
—
|
|
|
—
|
|
|
490
|
|
|
—
|
|
Plus: Loss (gain) on disposition of assets
|
|
|
(300)
|
|
|
50
|
|
|
(23)
|
|
|
(507)
|
|
|
772
|
|
Plus: Proceeds from insurance recovery
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
73
|
|
Less: Maintenance capital expenditures (3)
|
|
|
(2,165)
|
|
|
(3,523)
|
|
|
(2,299)
|
|
|
(12,560)
|
|
|
(7,739)
|
|
Distributable Cash Flow
|
|
$
|
33,223
|
|
$
|
30,811
|
|
$
|
28,703
|
|
$
|
118,330
|
|
$
|
118,329
|
|
Plus: Maintenance capital expenditures
|
|
|
2,165
|
|
|
3,523
|
|
|
2,299
|
|
|
12,560
|
|
|
7,739
|
|
Plus: Change in working capital
|
|
|
5,731
|
|
|
(1,074)
|
|
|
(21,846)
|
|
|
(3,758)
|
|
|
(20,588)
|
|
Less: Transaction expenses for acquisitions
|
|
|
(1,406)
|
|
|
—
|
|
|
56
|
|
|
(1,406)
|
|
|
(894)
|
|
Less: Other
|
|
|
(370)
|
|
|
(231)
|
|
|
(111)
|
|
|
(1,082)
|
|
|
(889)
|
|
Net cash provided by operating activities
|
|
$
|
39,343
|
|
$
|
33,029
|
|
$
|
9,101
|
|
$
|
124,644
|
|
$
|
103,697
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributable Cash Flow
|
|
$
|
33,223
|
|
$
|
30,811
|
|
$
|
28,703
|
|
$
|
118,330
|
|
$
|
118,329
|
|
Cash distributions to general partner and IDRs
|
|
|
754
|
|
|
753
|
|
|
723
|
|
|
3,007
|
|
|
2,866
|
|
Distributable Cash Flow attributable to limited partner interest
|
|
$
|
32,469
|
|
$
|
30,058
|
|
$
|
27,980
|
|
$
|
115,323
|
|
$
|
115,463
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions for Distributable Cash Flow Coverage Ratio (4)
|
|
$
|
32,652
|
|
$
|
32,559
|
|
$
|
29,618
|
|
$
|
129,657
|
|
$
|
115,881
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions reinvested in the DRIP (5)
|
|
$
|
304
|
|
$
|
2,920
|
|
$
|
4,042
|
|
$
|
16,592
|
|
$
|
24,441
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions for Cash Coverage Ratio (6)
|
|
$
|
32,348
|
|
$
|
29,639
|
|
$
|
25,576
|
|
$
|
113,065
|
|
$
|
91,440
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributable Cash Flow Coverage Ratio (7)
|
|
|
0.99
|
|
|
0.92
|
|
|
0.94
|
|
|
0.89
|
|
|
1.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Coverage Ratio (8)
|
|
|
1.00
|
|
|
1.01
|
|
|
1.09
|
|
|
1.02
|
|
|
1.26
|
|
______________________
|
|
(1)
|
|
For the quarters ended December 31, 2017, September 30, 2017 and
December 31, 2016, unit-based compensation expense included $0.5
million, $0.6 million, and $0.6 million, respectively, of cash
payments related to quarterly payments of distribution equivalent
rights on outstanding phantom unit awards. For the years ended
December 31, 2017 and 2016, unit-based compensation expense included
$2.5 million and $2.8 million, respectively, of cash payments
related to quarterly payments of distribution equivalent rights on
outstanding phantom unit awards and $0.4 million and $0.1 million,
respectively, related to the cash portion of any settlement of
phantom unit awards upon vesting. The remainder of the unit-based
compensation expense for each period presented in 2017 and 2016 was
related to non-cash adjustments to the unit-based compensation
liability.
|
|
|
|
|
|
(2)
|
|
Represents certain transaction expenses related to potential
acquisitions. The Partnership believes it is useful to investors to
exclude these fees.
|
|
|
|
|
|
(3)
|
|
Reflects actual maintenance capital expenditures for the period
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
operating income.
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(4)
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Represents distributions to the holders of the Partnership’s common
units, after giving effect to the weighted average common units
outstanding due to our December 2016 equity offering for the quarter
ended December 31, 2016 and the year ended December 31, 2016, as
applicable, as of the record date for each period. Without giving
effect to the weighted average common units outstanding due to our
December 2016 equity offering for the quarter ended December 31,
2016 and the year ended December 31, 2016, actual distributions to
holders of the Partnership’s common units were $31.9 million and
$118.1 million, respectively.
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(5)
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Represents distributions to holders enrolled in the DRIP as of the
record date for each period. The amount for the quarter ended
December 31, 2017 is based on an estimate as of the record date.
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(6)
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Represents cash distributions declared for common units not
participating in the DRIP for each period, after giving effect to
the weighted average common units outstanding due to our December
2016 equity offering for the quarter ended December 31, 2016 and the
year ended December 31, 2016, as applicable.
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(7)
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For the quarter ended December 31, 2016, the Distributable Cash Flow
Coverage Ratio based on actual units outstanding at the record date
was 0.88x. For the year ended December 31, 2016, the Distributable
Cash Flow Coverage Ratio based on actual units outstanding at the
respective record dates was 0.98x.
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(8)
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For the quarter ended December 31, 2016, the Cash Coverage Ratio
based on actual units outstanding at the record date was 1.00x. For
the year ended December 31, 2016, the Cash Coverage Ratio based on
actual units outstanding at the respective record dates was 1.23x.
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USA COMPRESSION PARTNERS, LP
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FULL-YEAR 2018 ADJUSTED EBITDA AND DISTRIBUTABLE CASH FLOW
GUIDANCE RANGE
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RECONCILIATION TO NET INCOME
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(Unaudited)
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|
|
|
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Guidance
|
|
Net income
|
|
$30.0 million to $40.0 million
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Plus: Interest expense
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|
$33.0 million
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Plus: Depreciation and amortization
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$101.5 million
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Plus: Income tax expense
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|
$0.5 million
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EBITDA
|
|
$165.0 million to $175.0 million
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Plus: Interest income on capital lease
|
|
$2.0 million
|
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Plus: Unit-based compensation expense
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|
$13.0 million
|
|
Adjusted EBITDA
|
|
$180.0 million to $190.0 million
|
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Less: Cash interest expense
|
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$34.5 million
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Less: Current income tax expense
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$0.5 million
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Less: Maintenance capital expenditures
|
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$15.0 million
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|
Distributable Cash Flow
|
|
$130.0 million to $140.0 million
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View source version on businesswire.com: http://www.businesswire.com/news/home/20180212005451/en/ Copyright Business Wire 2018
Source: Business Wire
(February 12, 2018 - 6:00 AM EST)
News by QuoteMedia
www.quotemedia.com
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