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Antero Midstream (AM) Q2 Earnings Top on Gathering Volumes
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Antero Midstream Corporation (AM - Free Report) reported second-quarter 2023 adjusted earnings per share of 22 cents, which beat the Zacks Consensus Estimate of 20 cents. The bottom line also improved from the year-ago quarter’s level of 20 cents.
Total quarterly revenues of $258.3 million surpassed the Zacks Consensus Estimate of $252 million. The top line also increased from $229 million in the year-ago quarter.
Strong quarterly results were primarily driven by higher compression and gathering volumes and increased average freshwater distribution fees.
Antero Midstream Corporation Price, Consensus and EPS Surprise
In the second quarter, average daily compression volumes were 3,251 million cubic feet (MMcf/d) compared with 2,776 MMcf/d in the year-ago period. The reported figure was also higher than our estimate of 2,865 MMcf/d. On a per-Mcf basis, the compression fee was 21 cents, in line with the prior-year quarter’s number.
High-pressure gathering volumes totaled 2,922 MMcf/d in the reported quarter, up from the year-ago period’s level of 2,819 MMcf/d. The figure was also higher than our estimate of 2,880 MMcf/d. On a per-Mcf basis, the average gathering high-pressure fee was 21 cents, in line with the year-ago quarter’s level.
Low-pressure gathering volumes averaged 3,304 MMcf/d compared with 2,970 MMcf/d in the second quarter of 2022. The figure was also higher than our estimate of 3,033 MMcf/d. On a per-Mcf basis, the average gathering low-pressure fee was 35 cents, higher than the prior-year quarter’s level of 34 cents.
Freshwater delivery volumes were registered at 105 MBbls/d, down 5% from the prior-year quarter’s level of 110 MBbls/d. On a per-barrel basis, the average freshwater distribution fee was $4.21 in the reported quarter compared with $4.09 in the year-ago period. The figure was also higher than our estimate of $4.10.
Operating Expenses
Direct operating expenses amounted to $52.6 million, up from $43.3 million a year ago.
Antero Midstream’s total operating expenses were $112.8 million, up from $100.5 million recorded in the corresponding period of 2022.
Balance Sheet
As of Jun 30, the company had no cash and cash equivalents. As of the same date, the company had $3,306.7 million of long-term debt.
Outlook
For 2023, Antero Midstream reiterated its net income projection in the range of $355-$395 million, indicating an increase from $326.2 million reported in 2022. The company expects an adjusted EBITDA of $950-$990 million for the year. The midstream operator looks forward to leverage target of 3.0x or less in 2024.
Zacks Rank & Stocks to Consider
Currently, Antero Midstream carries a Zacks Rank #3 (Hold).
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Murphy USA serves 1.6 million customers daily and owns a dedicated line space on the Colonial Pipeline. MUSA operates stations close to Walmart supercenters and is a low-cost, high-volume fuel seller. This enables the company to attract significantly more transactions than its peers.
MPLX generates stable fee-based revenues from diverse midstream energy assets via long-term contracts and is least exposed to commodity price fluctuations. The partnership is well positioned to capitalize on the growing demand for fresh midstream assets in order to support increasing volumes of crude oil, natural gas and NGLs in the prolific shale plays in the United States.
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Antero Midstream (AM) Q2 Earnings Top on Gathering Volumes
Antero Midstream Corporation (AM - Free Report) reported second-quarter 2023 adjusted earnings per share of 22 cents, which beat the Zacks Consensus Estimate of 20 cents. The bottom line also improved from the year-ago quarter’s level of 20 cents.
Total quarterly revenues of $258.3 million surpassed the Zacks Consensus Estimate of $252 million. The top line also increased from $229 million in the year-ago quarter.
Strong quarterly results were primarily driven by higher compression and gathering volumes and increased average freshwater distribution fees.
Antero Midstream Corporation Price, Consensus and EPS Surprise
Antero Midstream Corporation price-consensus-eps-surprise-chart | Antero Midstream Corporation Quote
Operational Performance
In the second quarter, average daily compression volumes were 3,251 million cubic feet (MMcf/d) compared with 2,776 MMcf/d in the year-ago period. The reported figure was also higher than our estimate of 2,865 MMcf/d. On a per-Mcf basis, the compression fee was 21 cents, in line with the prior-year quarter’s number.
High-pressure gathering volumes totaled 2,922 MMcf/d in the reported quarter, up from the year-ago period’s level of 2,819 MMcf/d. The figure was also higher than our estimate of 2,880 MMcf/d. On a per-Mcf basis, the average gathering high-pressure fee was 21 cents, in line with the year-ago quarter’s level.
Low-pressure gathering volumes averaged 3,304 MMcf/d compared with 2,970 MMcf/d in the second quarter of 2022. The figure was also higher than our estimate of 3,033 MMcf/d. On a per-Mcf basis, the average gathering low-pressure fee was 35 cents, higher than the prior-year quarter’s level of 34 cents.
Freshwater delivery volumes were registered at 105 MBbls/d, down 5% from the prior-year quarter’s level of 110 MBbls/d. On a per-barrel basis, the average freshwater distribution fee was $4.21 in the reported quarter compared with $4.09 in the year-ago period. The figure was also higher than our estimate of $4.10.
Operating Expenses
Direct operating expenses amounted to $52.6 million, up from $43.3 million a year ago.
Antero Midstream’s total operating expenses were $112.8 million, up from $100.5 million recorded in the corresponding period of 2022.
Balance Sheet
As of Jun 30, the company had no cash and cash equivalents. As of the same date, the company had $3,306.7 million of long-term debt.
Outlook
For 2023, Antero Midstream reiterated its net income projection in the range of $355-$395 million, indicating an increase from $326.2 million reported in 2022. The company expects an adjusted EBITDA of $950-$990 million for the year. The midstream operator looks forward to leverage target of 3.0x or less in 2024.
Zacks Rank & Stocks to Consider
Currently, Antero Midstream carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy space are Evolution Petroleum Corporation (EPM - Free Report) , Murphy USA Inc. (MUSA - Free Report) and MPLX LP (MPLX - Free Report) . While EPM sports a Zacks Rank #1 (Strong Buy), both MUSA and MPLX carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Murphy USA serves 1.6 million customers daily and owns a dedicated line space on the Colonial Pipeline. MUSA operates stations close to Walmart supercenters and is a low-cost, high-volume fuel seller. This enables the company to attract significantly more transactions than its peers.
MPLX generates stable fee-based revenues from diverse midstream energy assets via long-term contracts and is least exposed to commodity price fluctuations. The partnership is well positioned to capitalize on the growing demand for fresh midstream assets in order to support increasing volumes of crude oil, natural gas and NGLs in the prolific shale plays in the United States.