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USA Compression (USAC) Q3 Earnings Lag, Revenues Top Estimates
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USA Compression Partners, LP (USAC - Free Report) reported third-quarter 2023 net profit of 9 cents per common unit, lagging the Zacks Consensus Estimate of 11 cents due to higher total costs and other expenses. However, the metric improved significantly from the year-ago quarter's loss of 3 cents. This was backed by net income of $20.9 million compared with $9.6 million a year ago.
Revenues of $217 million were up 20.9% from the year-ago quarter’s level and beat the Zacks Consensus Estimate of $208 million.
Adjusted EBITDA increased 19.2% to $130.2 million and came ahead of our estimate of $129.5 million. Distributable cash flow reduced from $71.6 million in the prior-year quarter to $55.2 million.
USAC reported operating cash flow of $50.1 million in the third quarter, increasing from the prior-year quarter’s $49.2 million. Gross operating margin of 65.5% marked a decrease from the year-ago period’s 66.9%.
USAC’s revenue-generating capacity increased 8.7% to 3.36 million horsepower year over year. The figure beat our estimate of 3.34 million horsepower. Further, average monthly revenue per horsepower rose to $19.10 from $17.53 in the third quarter of 2023.
Meanwhile, USA Compression’s average quarterly horsepower utilization rate came in at 93.6%, up from 90.3% a year ago.
USA Compression Partners, LP Price, Consensus and EPS Surprise
USAC’s Distributable cash flow available to limited partners totaled $71.6 million (providing 1.39x distribution coverage), up 29.7% from the year-ago levels.
Notably, on Oct 12, it announced third-quarter cash distribution of 52.50 cents per unit ($2.10 on an annualized basis). The distribution will be paid out on Nov 3, 2023, to common unitholders of record as of Oct 23, 2023.
It reported $156.1 million in costs and expenses, up 16.1% from the year-ago quarter’s $134.5 million.
It spent $62.5 million on growth capex. Maintenance capex amounted to $7.2 million.
As of Sep 30, 2023, USA Compression had net long-term debt of $2.3 billion.
Guidance
For 2023, USAC anticipates distributable cash flow in the $270-$280 million range. Management expects adjusted EBITDA in the band of $500-$510 million.
The company anticipates 2023 net income in the $73-$83 million range.
CVR Energy is valued at $3.29 billion. In the past year, its shares have declined 10.2%.
CVI currently pays a dividend of $2 per share or 6.11% on an annual basis. Its payout ratio is 30% of earnings.
APA Corporation is valued at around $12.20 billion. APA currently pays a dividend of $1 per unit, or 2.52% on an annual basis.
APA Corporation, through its subsidiaries, explores for, develops and produces natural gas, crude oil and natural gas liquids. The company owns four Permian Basin long-haul pipelines and operates gathering, compression, processing and transmission assets in West Texas.
Delek US Holdings is worth approximately $1.17 billion. DK currently pays a dividend of 94 cents per share, or 3.57% on an annual basis.
Delek US Holdings operates in the integrated downstream energy business in the United States. The company operates in three segments: refining, logistics and retail.
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USA Compression (USAC) Q3 Earnings Lag, Revenues Top Estimates
USA Compression Partners, LP (USAC - Free Report) reported third-quarter 2023 net profit of 9 cents per common unit, lagging the Zacks Consensus Estimate of 11 cents due to higher total costs and other expenses. However, the metric improved significantly from the year-ago quarter's loss of 3 cents. This was backed by net income of $20.9 million compared with $9.6 million a year ago.
Revenues of $217 million were up 20.9% from the year-ago quarter’s level and beat the Zacks Consensus Estimate of $208 million.
Adjusted EBITDA increased 19.2% to $130.2 million and came ahead of our estimate of $129.5 million. Distributable cash flow reduced from $71.6 million in the prior-year quarter to $55.2 million.
USAC reported operating cash flow of $50.1 million in the third quarter, increasing from the prior-year quarter’s $49.2 million. Gross operating margin of 65.5% marked a decrease from the year-ago period’s 66.9%.
USAC’s revenue-generating capacity increased 8.7% to 3.36 million horsepower year over year. The figure beat our estimate of 3.34 million horsepower. Further, average monthly revenue per horsepower rose to $19.10 from $17.53 in the third quarter of 2023.
Meanwhile, USA Compression’s average quarterly horsepower utilization rate came in at 93.6%, up from 90.3% a year ago.
USA Compression Partners, LP Price, Consensus and EPS Surprise
USA Compression Partners, LP price-consensus-eps-surprise-chart | USA Compression Partners, LP Quote
DCF, Cost, Capex & Balance Sheet
USAC’s Distributable cash flow available to limited partners totaled $71.6 million (providing 1.39x distribution coverage), up 29.7% from the year-ago levels.
Notably, on Oct 12, it announced third-quarter cash distribution of 52.50 cents per unit ($2.10 on an annualized basis). The distribution will be paid out on Nov 3, 2023, to common unitholders of record as of Oct 23, 2023.
It reported $156.1 million in costs and expenses, up 16.1% from the year-ago quarter’s $134.5 million.
It spent $62.5 million on growth capex. Maintenance capex amounted to $7.2 million.
As of Sep 30, 2023, USA Compression had net long-term debt of $2.3 billion.
Guidance
For 2023, USAC anticipates distributable cash flow in the $270-$280 million range. Management expects adjusted EBITDA in the band of $500-$510 million.
The company anticipates 2023 net income in the $73-$83 million range.
Zacks Rank and Other Key Picks
Currently, USAC carries a Zacks Rank #2 (Buy).
Investors interested in the energy sector might look at some other top-ranked stocks like CVR Energy (CVI - Free Report) , APA Corporation (APA - Free Report) and Delek US Holdings, Inc. (DK - Free Report) . While CVI sports a Zacks Rank #1 (Strong Buy), APA and DK carry a Zacks Rank #2 each. You can see the complete list of today’s Zacks #1 Rank stocks here.
CVR Energy is valued at $3.29 billion. In the past year, its shares have declined 10.2%.
CVI currently pays a dividend of $2 per share or 6.11% on an annual basis. Its payout ratio is 30% of earnings.
APA Corporation is valued at around $12.20 billion. APA currently pays a dividend of $1 per unit, or 2.52% on an annual basis.
APA Corporation, through its subsidiaries, explores for, develops and produces natural gas, crude oil and natural gas liquids. The company owns four Permian Basin long-haul pipelines and operates gathering, compression, processing and transmission assets in West Texas.
Delek US Holdings is worth approximately $1.17 billion. DK currently pays a dividend of 94 cents per share, or 3.57% on an annual basis.
Delek US Holdings operates in the integrated downstream energy business in the United States. The company operates in three segments: refining, logistics and retail.