USA Compression's Q4 Earnings Lag Estimates, Revenues Top

Core Viewpoint - USA Compression Partners (USAC) reported a fourth-quarter adjusted net profit of 18 cents per common unit, missing the Zacks Consensus Estimate of 26 cents, but showing improvement from 10 cents in the same quarter last year due to higher revenue-generating capacity [1] Financial Performance - USAC generated revenues of $246 million, a 1.7% increase from the previous year, surpassing the Zacks Consensus Estimate of $242 million, driven by a 9.3% overall revenue increase, a 5% rise in contract operations, and a 169% increase in related-party revenues [2] - Adjusted EBITDA rose 12.2% to $155.5 million, exceeding the estimate of $143.1 million, while distributable cash flow decreased from $96.3 million to $79.9 million year-over-year [3] - The company reported a net income of $25.4 million compared to $12.8 million a year ago, with net operating cash flow increasing to $130.2 million from $91.6 million [3] Margins and Distributions - Adjusted gross operating margin improved to 68.4% from 67.5% in the prior year [4] - USAC declared a cash distribution of 52.5 cents per unit for the fourth quarter, maintaining the same amount as the previous quarter, reflecting a commitment to consistent returns [4] Capacity and Utilization - Revenue-generating capacity increased by 4.5% year-over-year to 3.56 million horsepower, exceeding the Zacks Consensus Estimate of 3.49 million horsepower [5] - Average monthly revenue per horsepower rose to $20.85 from $19.52, although it was below the estimate of $20.95, with an average quarterly horsepower utilization rate of 94.5%, up from 94.1% a year ago [5] Costs and Capital Expenditures - Distributable cash flow available to limited partners totaled $86.6 million, providing 1.56X distribution coverage, up 20.5% from the previous year [6] - Total costs and expenses were reported at $171.4 million, a 9.5% increase from $156.5 million in the prior year, with growth capital expenditures of $37.6 million and maintenance capital expenditures of $8.2 million [6] Guidance - For 2025, USAC expects adjusted EBITDA to be between $590 million and $610 million and distributable cash flow to range from $350 million to $370 million [7] - The company anticipates expansion capital expenditures of $120 million to $140 million and maintenance capital expenditures of $38 million to $42 million for 2025 [7]