USA pression Partners(US:USAC)2025-11-05 17:00Financial Data and Key Metrics Changes - The company reported revenues exceeding $250 million, adjusted EBITDA over $160 million, and DCF approaching $104 million, with strong margins and consistent utilization resulting in an improved leverage ratio of 3.9 times and a DCF coverage ratio of 1.6 times [6][11][12] - The net income for Q3 2025 was $34.5 million, operating income was $83.9 million, and net cash provided by operating activities was $75.9 million [11] Business Line Data and Key Metrics Changes - Average pricing per horsepower reached an all-time high of $21.46, reflecting a 1% increase sequentially and a 4% increase year-over-year [11] - Average active horsepower remained stable at 3.55 million, with total fleet horsepower at approximately 3.9 million, consistent with the previous quarter [11][12] Market Data and Key Metrics Changes - The company expects active horsepower in the Northeast and Central Regions to grow by over 40,000 horsepower before the end of 2025 compared to Q2 [8] - The company has contracted 300 small horsepower units to increase utilization to nearly 80% over the coming months [9] Company Strategy and Development Direction - The company plans to deploy most of its 2025 new unit horsepower in Q4, setting the foundation for continued momentum in 2026 [7] - The 2026 capital budget is being finalized, with expectations that new horsepower will exceed 2025 levels due to continued natural gas demand and new projects [7][8] - The company is focused on cost management and operational discipline, leading to increased guidance for EBITDA and DCF for 2025 [6][13] Management's Comments on Operating Environment and Future Outlook - Management noted that U.S. producers are evaluating macro market conditions for their 2026 capital budgets, but growth opportunities remain in the markets they operate [7] - The company is optimistic about the path forward, citing successful ERP implementation and cost synergies from a new shared services model [15] Other Important Information - The company refinanced its ABL and 2027 senior notes, significantly reducing weighted average borrowing costs and improving strategic flexibility [10][14] - The company expects to realize over $10 million in annualized interest savings from recent refinancing efforts [14] Q&A Session Summary Question: Can you speak to your willingness to lean further into compression and dry gas plays in a sustained slowdown in oil-directed activity? - Management indicated they are already established in dry gas markets and can move equipment as needed to support growth in those areas [17][18] Question: Can you speak to recent pricing dynamics and how spot prices compare to your fleet average? - Management noted that pricing trends have picked up since Q2, and they expect dollar per horsepower revenue to remain consistent into the back half of 2025 and into 2026 [20][21]