USA pression Partners(USAC) - 2025 Q2 - Quarterly Results

Financial & Operational Highlights USA Compression achieved record Q2 2025 revenues, driven by strong demand and a 5% increase in average revenue per horsepower, while maintaining its quarterly distribution Financial Highlights | Financial Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues (Millions) | $250.1 | $235.3 | +6.3% | | Net Income (Millions) | $28.6 | $31.2 | -8.3% | | Adjusted EBITDA (Millions) | $149.5 | $143.7 | +4.0% | | Distributable Cash Flow (Millions) | $89.9 | $85.9 | +4.7% | | DCF Coverage (x) | 1.40 | 1.40 | Unchanged | - Achieved record average revenue per revenue-generating horsepower per month of $21.31, a 5% increase from $20.29 in Q2 2024, reflecting strong demand for services[3][6] - Announced a second-quarter cash distribution of $0.525 per common unit, corresponding to an annualized rate of $2.10 per unit, consistent with the prior-year quarter[4][6] - In June 2025, holders of Series A Preferred Units converted 100,000 units into 4,997,126 common units[5] Detailed Financial & Operational Data Q2 2025 saw an increase in average revenue-generating horsepower and total revenues, despite a slight dip in utilization and Adjusted EBITDA margin Detailed Financial and Operational Metrics | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Operational Data (Units) | | | | | Fleet horsepower (at period end) | 3,858,508 | 3,859,920 | 3,851,970 | | Average revenue-generating horsepower | 3,551,446 | 3,557,164 | 3,515,483 | | Average horsepower utilization (%) | 94.4 | 94.4 | 94.7 | | Financial Data (Thousands) | | | | | Total revenues ($) | 250,125 | 245,234 | 235,313 | | Net income ($) | 28,559 | 20,512 | 31,238 | | Adjusted EBITDA ($) | 149,482 | 149,514 | 143,673 | | Distributable Cash Flow ($) | 89,926 | 88,695 | 85,863 | Liquidity and Long-Term Debt The Partnership maintained compliance with debt covenants, possessing $735.1 million in available borrowing capacity and $1.75 billion in outstanding senior notes - Under its $1.6 billion revolving credit facility, the Partnership had $770.6 million in outstanding borrowings and $735.1 million of available borrowing capacity as of June 30, 2025[14] - The aggregate principal amount of outstanding senior notes totaled $1.75 billion, split between notes due in 2027 and 2029[14] Full-Year 2025 Outlook The company reaffirmed its full-year 2025 guidance, projecting Adjusted EBITDA between $590 million and $610 million and Distributable Cash Flow between $350 million and $370 million Full-Year 2025 Financial Outlook | Full-Year 2025 Outlook | Low ($) | High ($) | | :--- | :--- | :--- | | Adjusted EBITDA | 590,000,000 | 610,000,000 | | Distributable Cash Flow | 350,000,000 | 370,000,000 | | Expansion capital expenditures | 120,000,000 | 140,000,000 | | Maintenance capital expenditures | 38,000,000 | 42,000,000 | Financial Statements This section provides the unaudited condensed consolidated financial statements for Q2 2025, detailing the company's operations, balance sheet, and cash flows Condensed Consolidated Statements of Operations Q2 2025 total revenues increased to $250.1 million, but operating income slightly decreased to $76.6 million, resulting in $0.22 net income per common unit Condensed Consolidated Statements of Operations | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | | Total revenues | 250,125 | 235,313 | | Operating income | 76,608 | 77,372 | | Net income | 28,559 | 31,238 | | Net income attributable to common unitholders | 26,609 | 26,851 | | Basic and diluted net income per common unit ($) | 0.22 | 0.23 | Selected Balance Sheet Data As of June 30, 2025, total assets were $2.67 billion, with net long-term debt at $2.50 billion, leading to a total partners' deficit of $121.4 million Selected Balance Sheet Data | Selected Balance Sheet Data (as of June 30, 2025) | Amount ($ thousands) | | :--- | :--- | | Total assets | 2,671,317 | | Long-term debt, net | 2,503,566 | | Total partners' deficit | (121,415) | Condensed Consolidated Statements of Cash Flows Q2 2025 net cash from operating activities rose to $124.2 million, while investing and financing activities used $22.4 million and $101.9 million, respectively Condensed Consolidated Statements of Cash Flows | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | 124,244 | 96,741 | | Net cash used in investing activities | (22,354) | (48,142) | | Net cash used in financing activities | (101,890) | (48,598) | Non-GAAP Financial Measures and Reconciliations This section defines and reconciles non-GAAP measures like Adjusted Gross Margin, Adjusted EBITDA, and Distributable Cash Flow to their GAAP equivalents, providing insight into operational performance Definitions of Non-GAAP Measures This section defines Adjusted Gross Margin, Adjusted EBITDA, Distributable Cash Flow, and DCF Coverage Ratio, explaining their use as supplemental performance metrics - Adjusted Gross Margin is defined as revenue less cost of operations, excluding depreciation and amortization, and is used to measure operating profitability[19] - Adjusted EBITDA is used to assess financial performance, viability of capital projects, and the ability to service debt and pay distributions, without regard to financing methods or capital structure[22][29] - Distributable Cash Flow (DCF) is considered an important measure of operating performance to compare cash generation to the cash distributions the Partnership expects to pay its common unitholders[27] Reconciliation of Adjusted Gross Margin Q2 2025 Adjusted Gross Margin was $163.6 million, reconciled from GAAP Gross Margin by adding back depreciation and amortization, showing an increase from Q2 2024 Reconciliation of Adjusted Gross Margin | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | :--- | | Gross margin (GAAP) | 92,785 | 93,223 | 91,838 | | Add: Depreciation and amortization | 70,841 | 70,393 | 65,313 | | Adjusted gross margin (Non-GAAP) | 163,626 | 163,616 | 157,151 | Reconciliation of Adjusted EBITDA Q2 2025 Adjusted EBITDA increased to $149.5 million, reconciled from Net Income by adding back interest, taxes, D&A, and other non-cash adjustments Reconciliation of Adjusted EBITDA | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | :--- | | Net income (GAAP) | 28,559 | 20,512 | 31,238 | | Interest expense, net | 47,674 | 47,369 | 48,828 | | Depreciation and amortization | 70,841 | 70,393 | 65,313 | | Income tax expense | 391 | 1,535 | 463 | | Other adjustments | 2,017 | 9,705 | (2,219) | | Adjusted EBITDA (Non-GAAP) | 149,482 | 149,514 | 143,673 | Reconciliation of Distributable Cash Flow Q2 2025 Distributable Cash Flow increased to $89.9 million, resulting in a 1.40x coverage ratio, consistent with the prior-year period Reconciliation of Distributable Cash Flow | Metric | Q2 2025 ($ thousands) | Q1 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | :--- | | Net income (GAAP) | 28,559 | 20,512 | 31,238 | | Adjustments (D&A, non-cash items, etc.) | 74,843 | 83,221 | 63,504 | | Less: Distributions on Preferred Units | (1,950) | (4,388) | (4,387) | | Less: Maintenance capital expenditures | (11,733) | (10,853) | (8,892) | | Distributable Cash Flow (Non-GAAP) | 89,926 | 88,695 | 85,863 | | Distributable Cash Flow Coverage Ratio (x) | 1.40 | 1.44 | 1.40 | Forward-Looking Statements This report includes forward-looking statements and the 2025 financial outlook, which are subject to various risks and uncertainties that could materially affect actual results - Key risk factors that could impact future results include[34] - Changes in economic conditions of the crude oil and natural gas industries - General economic conditions, including inflation and supply chain disruptions - Changes in the availability and cost of capital, including interest rates - Competitive conditions and information technology risks like cyberattacks