AUSTIN, Texas--(BUSINESS WIRE)--Feb. 10, 2016--
USA Compression Partners, LP (NYSE: USAC) (“USA Compression” or the
“Partnership”), announced today its financial and operating results for
the fourth quarter and full-year 2015.
Fourth Quarter and Full-Year 2015 Summary
Results
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Revenues increased; fourth quarter 2015 up 12.5% over fourth quarter
2014 and full-year 2015 up 22.1% over full-year 2014
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Adjusted EBITDA increased; fourth quarter 2015 up 14.9% over fourth
quarter 2014 and full-year 2015 up 34.2% over full-year 2014
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Distributable Cash Flow increased; fourth quarter 2015 up 6.7% over
fourth quarter 2014 and full-year 2015 up 40.6% over full-year 2014
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Fourth quarter 2015 cash distribution of $0.525 per common unit, an
increase of 2.9% over fourth quarter 2014
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Fleet horsepower at quarter-end 2015 increased by 10.5% over
quarter-end 2014
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Average revenue per horsepower per month for fourth quarter 2015
increased 0.9% over fourth quarter 2014
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Distributable Cash Flow coverage of 0.99x for the fourth quarter 2015
and 1.17x for the full-year 2015
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Cash coverage of 2.35x for the fourth quarter 2015 and 2.86x for the
full-year 2015
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Three months ended
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Year Ended
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December 31,
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September 30,
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December 31,
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December 31,
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2015
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2015
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2014
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2015
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2014
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Operational Data
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Fleet Horsepower (at period end)
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1,712,196
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1,686,300
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1,549,020
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1,712,196
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1,549,020
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Revenue Generating Horsepower (at period end)
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1,424,537
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1,415,355
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1,351,052
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1,424,537
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1,351,052
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Average Revenue Generating Horsepower
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1,420,060
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1,423,749
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1,324,983
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1,408,689
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1,200,851
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Revenue Generating Compression Units (at period end)
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2,737
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2,765
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2,651
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2,737
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2,651
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Horsepower Utilization (at period end) (1)
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89.2
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%
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90.4
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%
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93.6
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%
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89.2
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%
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93.6
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%
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Average Horsepower Utilization (for the period) (1)
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89.5
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%
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90.2
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%
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93.3
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%
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90.5
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%
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94.0
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%
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Financial Data ($ in thousands, except per
horsepower data)
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Revenue
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$
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68,615
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$
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70,540
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$
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60,995
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$
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270,545
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$
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221,509
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Average Revenue Per Horsepower Per Month (2)
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$
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15.97
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$
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15.94
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$
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15.82
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$
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15.90
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$
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15.57
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Gross Operating Margin (3)
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$
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47,285
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$
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48,621
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$
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42,105
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$
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189,006
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$
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147,474
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Gross Operating Margin Percentage
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68.9
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%
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68.9
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%
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69.0
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%
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69.9
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%
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66.6
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%
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Adjusted EBITDA (3)
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$
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37,955
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$
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39,481
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$
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33,024
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$
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153,572
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$
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114,409
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Adjusted EBITDA Percentage
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55.3
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%
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56.0
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%
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54.1
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%
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56.8
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%
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51.6
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%
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Distributable Cash Flow (3) (4)
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$
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28,041
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$
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32,269
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$
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26,275
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$
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120,850
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$
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85,927
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(1) Horsepower utilization is calculated as (i) the sum of (a) revenue
generating horsepower; (b) horsepower in the Partnership’s fleet that is
under contract but is not yet generating revenue; and (c) horsepower not
yet in the Partnership’s fleet that is under contract, not yet
generating revenue and subject to a purchase order, divided by
(ii) total available horsepower less idle horsepower that is under
repair. Horsepower utilization based on revenue generating horsepower
and fleet horsepower at each applicable period end was 83.2%, 83.9% and
87.2% for the quarters ended December 31, 2015, September 30, 2015 and
December 31, 2014, respectively. Average horsepower utilization based on
revenue generating horsepower and fleet horsepower was 83.4%, 85.3% and
87.0% for the quarters ended December 31, 2015, September 30, 2015 and
December 31, 2014, respectively, and 85.1% and 87.3% for the years ended
December 31, 2015 and 2014, respectively.
(2) Calculated using average revenue generating horsepower.
(3) Gross operating margin, Adjusted EBITDA and Distributable Cash Flow
are all non-U.S. generally accepted accounting principles (“GAAP”)
financial measures. For the definition of each measure, see “Non-GAAP
Financial Measures” below.
(4) Distributable Cash Flow for the quarters ended September 30, 2015,
December 31, 2014 and for the year ended December 31, 2014 was
previously presented as Adjusted Distributable Cash Flow. The definition
of Distributable Cash Flow is identical to the definition of Adjusted
Distributable Cash Flow previously presented. See “Non-GAAP Financial
Measures” section below for the definition of Distributable Cash Flow.
Fourth quarter 2015 Financial and Operating
Performance
Revenues in the fourth quarter of 2015 rose 12.5% to $68.6 million as
compared to $61.0 million for the fourth quarter of 2014. Adjusted
EBITDA rose 14.9% to $38.0 million in the fourth quarter of 2015 as
compared to $33.0 million for the fourth quarter of 2014. Distributable
Cash Flow increased 6.7% to $28.0 million in the fourth quarter of 2015,
compared to $26.3 million for the fourth quarter of 2014. The
Partnership had a net loss of $159.6 million in the fourth quarter of
2015, which included a $172.2 million charge due to non-cash impairment
of goodwill. Excluding this goodwill impairment charge, the
Partnership’s net income was $12.6 million in the fourth quarter of
2015, compared with net income of $8.5 million for the fourth quarter of
2014. The $172.2 million goodwill impairment charge is primarily the
result of the sustained decline in the market price of the Partnership’s
common units. The impairment charge did not impact the Partnership’s
cash flows, liquidity position or compliance with debt covenants. The
Partnership did not incur a goodwill impairment charge during the fourth
quarter of 2014.
“We are reporting Adjusted EBITDA and Distributable Cash Flow at
approximately 3% and 5% above the mid-point of our 2015 Outlook,
respectively,” said Eric D. Long, USA Compression’s President and Chief
Executive Officer. “While uncertainty across the entire energy sector
persists, we have been able to maintain stability in our cash flows due
substantially to our geographic focus on shale plays that continue to
have stable production and due to a strong focus on maximizing our
utilization as well as operating margin."
“In this environment, we are remaining very disciplined with regards to
our capital spending, and at present have only 15,400 horsepower on
order for delivery in 2016,” he said.
Average revenue generating horsepower increased 7.2% to 1,420,060 for
the fourth quarter of 2015 as compared to 1,324,983 for the fourth
quarter of 2014, primarily due to organic growth across our compression
fleet. Average revenue per revenue generating horsepower per month
increased 0.9% to $15.97 for the fourth quarter of 2015 as compared to
$15.82 for the fourth quarter of 2014.
Gross operating margin increased 12.3% to $47.3 million for the fourth
quarter of 2015 as compared to $42.1 million for the fourth quarter of
2014. Gross operating margin as a percentage of total revenues was 68.9%
for the fourth quarter of 2015, consistent with 69.0% in the fourth
quarter of 2014.
Expansion capital expenditures (used primarily to purchase new
compression units) were $36.8 million, maintenance capital expenditures
were $6.0 million and cash interest expense, net was $4.1 million for
the fourth quarter of 2015.
On January 21, 2016, the Partnership announced a cash distribution of
$0.525 per unit on its common and subordinated units. This fourth
quarter distribution corresponds to an annualized distribution rate of
$2.10 per unit. The distribution will be paid on February 12, 2016 to
unitholders of record as of the close of business on February 2, 2016.
USA Compression Holdings, LLC, the owner of approximately 41% of the
Partnership’s outstanding limited partner interests, elected to reinvest
all of this distribution with respect to its units pursuant to the
Partnership’s Distribution Reinvestment Plan (the “DRIP”). The
Distributable Cash Flow Coverage Ratio for the fourth quarter of 2015
was 0.99x and the Cash Coverage Ratio was 2.35x.
Credit Facility
As of December 31, 2015, the outstanding balance under the Partnership’s
revolving credit facility was approximately $729 million.
Conversion of Subordinated Units
Upon the payment of the quarterly distribution on February 12, 2016, the
Partnership will satisfy the earnings and distribution tests contained
in its partnership agreement for the conversion of all 14,048,588
outstanding subordinated units into common units. As a result, all of
the subordinated units will convert to common units on a one-for-one
basis on February 16, 2016.
Full-Year 2016 Outlook
USA Compression is providing the following full-year 2016 guidance:
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Adjusted EBITDA range of $138 million to $153 million; and
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Distributable Cash Flow range of $102 million to $117 million; and
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Expansion capital expenditure range of $40 million to $50 million.
Conference Call
The Partnership will host a conference call today beginning at
11:00 a.m. Eastern Time (10:00 a.m. Central Time) to discuss its fourth
quarter and full-year 2015 performance. The call will be broadcast live
over the Internet. Investors may participate either by phone or audio
webcast.
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By Phone:
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Dial 888-401-4669 inside the U.S. and Canada at least 10 minutes
before the call and ask for the USA Compression Partners Earnings
Call. Investors outside the U.S. and Canada should dial
719-325-2469. The conference ID for both is 8266458.
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A replay of the call will be available through February 21, 2016.
Callers inside the U.S. and Canada may access the replay by dialing
888-203-1112. Investors outside the U.S. and Canada should dial
719-457-0820. The passcode for both is 8266458.
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By Webcast:
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Connect to the webcast via the “Events” page of USA Compression’s
Investor Relations website at investors.usacompression.com.
Please log in at least 10 minutes in advance to register and
download any necessary software. A replay will be available
shortly after the call through February 21, 2016.
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About USA Compression Partners, LP
USA Compression Partners, LP is a growth-oriented Delaware limited
partnership that is one of the nation’s largest independent providers of
compression services in terms of total compression fleet horsepower. The
Partnership partners with a broad customer base composed of producers,
processors, gatherers and transporters of natural gas and crude oil. The
Partnership focuses on providing compression services to infrastructure
applications primarily in high-volume gathering systems, processing
facilities and transportation applications. More information is
available at usacompression.com.
Non-GAAP Financial Measures
This news release includes the non- GAAP financial measures of Adjusted
EBITDA, gross operating margin, Distributable Cash Flow, Distributable
Cash Flow Coverage Ratio and Cash Coverage Ratio.
The Partnership’s management views Adjusted EBITDA as one of its primary
financial measures in evaluating the results of the Partnership’s
business, and the Partnership tracks this item on a monthly basis both
as an absolute amount and as a percentage of revenue compared to the
prior month, year-to-date and prior year and to budget. The Partnership
defines EBITDA as net income (loss) before net interest expense,
depreciation and amortization expense, and income taxes. The Partnership
defines Adjusted EBITDA as EBITDA plus impairment of compression
equipment, impairment of goodwill, interest income, unit-based
compensation expense, (gain) loss on sale of assets and transaction
expenses. Adjusted EBITDA is used as a supplemental financial measure by
the Partnership’s management and external users of its financial
statements, such as investors and commercial banks, to assess:
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the financial performance of the Partnership’s assets without regard
to the impact of financing methods, capital structure or historical
cost basis of the Partnership’s assets;
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the viability of capital expenditure projects and the overall rates of
return on alternative investment opportunities;
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the ability of the Partnership’s assets to generate cash sufficient to
make debt payments and distributions; and
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the Partnership’s operating performance as compared to those of other
companies in its industry without regard to the impact of financing
methods and capital structure.
The Partnership’s management believes that Adjusted EBITDA provides
useful information to investors because, when viewed with GAAP results
and the accompanying reconciliations, it provides a more complete
understanding of the Partnership’s performance than GAAP results alone.
The Partnership’s management also believes that external users of its
financial statements benefit from having access to the same financial
measures that management uses in evaluating the results of the
Partnership’s business.
Adjusted EBITDA should not be considered an alternative to, or more
meaningful than, net income (loss), operating income, cash flows from
operating activities or any other measure of financial performance
presented in accordance with GAAP, as measures of operating performance
and liquidity. Moreover, Adjusted EBITDA as presented may not be
comparable to similarly titled measures of other companies.
Gross operating margin, a non-GAAP financial measure, is defined as
revenue less cost of operations, exclusive of depreciation and
amortization expense. The Partnership’s management believes that gross
operating margin is useful as a supplemental measure of the
Partnership’s performance. Gross operating margin is impacted primarily
by the pricing trends for service operations and cost of operations,
including labor rates for service technicians, volume and per unit costs
for lubricant oils, quantity and pricing of routine preventative
maintenance on compression units and property tax rates on compression
units. Gross operating margin should not be considered an alternative
to, or more meaningful than, operating income or any other measure of
financial performance presented in accordance with GAAP. Moreover, gross
operating margin as presented may not be comparable to similarly titled
measures of other companies. Because the Partnership capitalizes assets,
depreciation and amortization of equipment is a necessary element of its
costs. To compensate for the limitations of gross operating margin as a
measure of the Partnership’s performance, the Partnership’s management
believes that it is important to consider operating income determined
under GAAP, as well as gross operating margin, to evaluate the
Partnership’s operating profitability.
Distributable Cash Flow, a non-GAAP measure, is defined as net income
(loss) plus non-cash interest expense, non-cash income tax expense,
depreciation and amortization expense, unit-based compensation expense,
impairment of compression equipment, impairment of goodwill, certain
transaction fees, and (gain) loss on sale of equipment, less maintenance
capital expenditures. The definition of Distributable Cash Flow is
identical to the definition of Adjusted Distributable Cash Flow
previously presented.
The Partnership’s management believes Distributable Cash Flow is an
important measure of operating performance because such measure allows
management, investors and others to compare basic cash flows the
Partnership generates (prior to the establishment of any retained cash
reserves by the Partnership’s general partner and the effect of the
DRIP) to the cash distributions the Partnership expects to pay its
unitholders.
Distributable Cash Flow Coverage Ratio, a non-GAAP measure, is defined
as Distributable Cash Flow less cash distributions to the Partnership’s
general partner and incentive distribution rights (“IDRs”), divided by
distributions declared to limited partner unitholders for the period.
Cash Coverage Ratio is defined as Distributable Cash Flow less cash
distributions to the Partnership’s general partner and IDRs divided by
cash distributions paid to limited partner unitholders, after taking
into account the non-cash impact of the DRIP. The Partnership’s
management believes Distributable Cash Flow Coverage Ratio and Cash
Coverage Ratio are important measures of operating performance because
they allow management, investors and others to gauge the Partnership’s
ability to pay cash distributions to limited partner unitholders using
the cash flows the Partnership generates. The Partnership’s
Distributable Cash Flow Coverage Ratio and Cash Coverage Ratio as
presented may not be comparable to similarly titled measures of other
companies.
This news release also contains a forward-looking estimate of Adjusted
EBITDA and Distributable Cash Flow projected to be generated by the
Partnership in its 2016 fiscal year. A reconciliation of the
forward-looking estimates of Adjusted EBITDA and Distributable Cash Flow
to net cash provided by operating activities is not provided because the
items necessary to estimate net cash provided by operating activities,
in particular the change in operating assets and liabilities, are not
accessible or estimable at this time. The Partnership does not
anticipate the changes in operating assets and liabilities to be
material, but changes in accounts receivable, accounts payable, accrued
liabilities and deferred revenue could be significant, such that the
amount of net cash provided by operating activities would vary
substantially from the amount of projected Adjusted EBITDA.
See “Reconciliation of Non-GAAP Financial Measures” for Adjusted EBITDA
reconciled to net income (loss) and net cash provided by operating
activities, and net income (loss) reconciled to Distributable Cash Flow,
Distributable Cash Flow Coverage Ratio and Cash Coverage Ratio.
Forward-Looking Statements
Some of the information in this news release may contain forward-looking
statements. These statements can be identified by the use of
forward-looking terminology including “may,” “believe,” “expect,”
“intend,” “anticipate,” “estimate,” “continue,” or other similar words,
and include the Partnership’s expectation of future performance
contained herein, including as described under “Full-Year 2016 Outlook.”
These statements discuss future expectations, contain projections of
results of operations or of financial condition, or state other
“forward-looking” information. You are cautioned not to place undue
reliance on any forward-looking statements, which can be affected by
assumptions used or by known risks or uncertainties. Consequently, no
forward-looking statements can be guaranteed. When considering these
forward-looking statements, you should keep in mind the risk factors
noted below and other cautionary statements in this news release. The
risk factors and other factors noted throughout this news release could
cause actual results to differ materially from those contained in any
forward-looking statement. Known material factors that could cause the
Partnership’s actual results to differ materially from the results
contemplated by such forward-looking statements are described in Part I,
Item 1A (“Risk Factors”) of the Partnership’s Annual Report on Form 10-K
for the fiscal year ended December 31, 2015, which the Partnership
expects to file on or before the filing deadline, and include:
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changes in general economic conditions and changes in economic
conditions of the crude oil and natural gas industry specifically;
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competitive conditions in the industry;
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changes in the long-term supply of and demand for crude oil and
natural gas;
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our ability to realize the anticipated benefits of acquisitions and to
integrate the acquired assets with our existing fleet;
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actions taken by the Partnership’s customers, competitors and
third-party operators;
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the deterioration of the financial condition of our customers;
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changes in the availability and cost of capital;
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operating hazards, natural disasters, weather-related delays, casualty
losses and other matters beyond the Partnership’s control;
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the effects of existing and future laws and governmental regulations;
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the effects of future litigation; and
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other factors discussed in the Partnership’s filings with the
Securities and Exchange Commission.
All forward-looking statements speak only as of the date of this news
release and are expressly qualified in their entirety by the foregoing
cautionary statements. Unless legally required, the Partnership
undertakes no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise. Unpredictable or unknown factors not discussed herein also
could have material adverse effects on forward-looking statements.
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USA COMPRESSION PARTNERS, LP AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(In thousands, except for unit amounts — Unaudited)
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Three months ended
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Year Ended
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December 31,
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September 30,
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December 31,
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December 31,
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2015
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2015
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2014
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2015
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2014
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Revenues:
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Contract operations
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$
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66,002
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$
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68,227
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$
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60,045
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$
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263,816
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$
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217,361
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Parts and service
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2,613
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2,313
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950
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6,729
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4,148
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Total revenues
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68,615
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70,540
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60,995
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270,545
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221,509
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Cost of operations, exclusive of depreciation and amortization
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21,330
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21,919
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18,890
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81,539
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74,035
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Gross operating margin
|
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47,285
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48,621
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42,105
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189,006
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147,474
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Other operating and administrative costs and expenses:
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Selling, general and administrative
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|
|
|
10,520
|
|
|
|
|
10,351
|
|
|
|
|
9,620
|
|
|
|
|
40,950
|
|
|
|
|
38,718
|
|
Depreciation and amortization
|
|
|
|
|
21,640
|
|
|
|
|
21,360
|
|
|
|
|
19,631
|
|
|
|
|
85,238
|
|
|
|
|
71,156
|
|
Loss (gain) on sale of assets
|
|
|
|
|
(1,742
|
)
|
|
|
|
920
|
|
|
|
|
(4
|
)
|
|
|
|
(1,040
|
)
|
|
|
|
(2,233
|
)
|
Impairment of compression equipment
|
|
|
|
|
2
|
|
|
|
|
443
|
|
|
|
|
1,102
|
|
|
|
|
27,274
|
|
|
|
|
2,266
|
|
Impairment of goodwill
|
|
|
|
|
172,189
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
172,189
|
|
|
|
|
-
|
|
Total other operating and administrative costs and expenses
|
|
|
|
|
202,609
|
|
|
|
|
33,074
|
|
|
|
|
30,349
|
|
|
|
|
324,611
|
|
|
|
|
109,907
|
|
Operating income (loss)
|
|
|
|
|
(155,324
|
)
|
|
|
|
15,547
|
|
|
|
|
11,756
|
|
|
|
|
(135,605
|
)
|
|
|
|
37,567
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
|
|
|
(4,531
|
)
|
|
|
|
(4,665
|
)
|
|
|
|
(3,260
|
)
|
|
|
|
(17,605
|
)
|
|
|
|
(12,529
|
)
|
Other
|
|
|
|
|
6
|
|
|
|
|
6
|
|
|
|
|
5
|
|
|
|
|
22
|
|
|
|
|
11
|
|
Total other expense
|
|
|
|
|
(4,525
|
)
|
|
|
|
(4,659
|
)
|
|
|
|
(3,255
|
)
|
|
|
|
(17,583
|
)
|
|
|
|
(12,518
|
)
|
Net income (loss) before income tax expense
|
|
|
|
|
(159,849
|
)
|
|
|
|
10,888
|
|
|
|
|
8,501
|
|
|
|
|
(153,188
|
)
|
|
|
|
25,049
|
|
Income tax expense
|
|
|
|
|
(219
|
)
|
|
|
|
1,083
|
|
|
|
|
-
|
|
|
|
|
1,085
|
|
|
|
|
103
|
|
Net income (loss)
|
|
|
|
$
|
(159,630
|
)
|
|
|
$
|
9,805
|
|
|
|
$
|
8,501
|
|
|
|
$
|
(154,273
|
)
|
|
|
$
|
24,946
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) allocated to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General partner's interest in net income (loss)
|
|
|
|
$
|
(2,062
|
)
|
|
|
$
|
411
|
|
|
|
$
|
288
|
|
|
|
$
|
(1,477
|
)
|
|
|
$
|
760
|
|
Common unitholders' interest in net income (loss)
|
|
|
|
$
|
(115,055
|
)
|
|
|
$
|
7,185
|
|
|
|
$
|
5,698
|
|
|
|
$
|
(107,513
|
)
|
|
|
$
|
16,811
|
|
Subordinated unitholders' interest in net income (loss)
|
|
|
|
$
|
(42,513
|
)
|
|
|
$
|
2,209
|
|
|
|
$
|
2,515
|
|
|
|
$
|
(45,283
|
)
|
|
|
$
|
7,375
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common units outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
38,099,517
|
|
|
|
|
34,123,395
|
|
|
|
|
31,022,878
|
|
|
|
|
34,109,547
|
|
|
|
|
28,087,498
|
|
Diluted
|
|
|
|
|
38,099,517
|
|
|
|
|
34,233,579
|
|
|
|
|
31,063,948
|
|
|
|
|
34,109,547
|
|
|
|
|
28,146,446
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average subordinated units outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
|
|
|
14,048,588
|
|
|
|
|
14,048,588
|
|
|
|
|
14,048,588
|
|
|
|
|
14,048,588
|
|
|
|
|
14,048,588
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common unit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$
|
(3.02
|
)
|
|
|
$
|
0.21
|
|
|
|
$
|
0.18
|
|
|
|
$
|
(3.15
|
)
|
|
|
$
|
0.60
|
|
Diluted
|
|
|
|
$
|
(3.02
|
)
|
|
|
$
|
0.21
|
|
|
|
$
|
0.18
|
|
|
|
$
|
(3.15
|
)
|
|
|
$
|
0.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per subordinated unit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
|
|
$
|
(3.03
|
)
|
|
|
$
|
0.16
|
|
|
|
$
|
0.18
|
|
|
|
$
|
(3.22
|
)
|
|
|
$
|
0.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions declared per limited partner unit in respective
periods
|
|
|
|
$
|
0.525
|
|
|
|
$
|
0.525
|
|
|
|
$
|
0.51
|
|
|
|
$
|
2.09
|
|
|
|
$
|
2.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USA COMPRESSION PARTNERS, LP AND SUBSIDIARIES RECONCILIATION
OF NON-GAAP FINANCIAL MEASURES ADJUSTED EBITDA TO NET INCOME
(LOSS) AND NET CASH PROVIDED BY OPERATING ACTIVITIES (In
thousands — Unaudited)
The following table reconciles Adjusted EBITDA to net income (loss) and
net cash provided by operating activities, its most directly comparable
GAAP financial measures, for each of the periods presented:
|
|
|
|
|
Three months ended
|
|
|
Year Ended
|
|
|
|
|
December 31,
|
|
|
September 30,
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
|
2015
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
Net income (loss)
|
|
|
|
$
|
(159,630
|
)
|
|
|
$
|
9,805
|
|
|
|
$
|
8,501
|
|
|
|
$
|
(154,273
|
)
|
|
|
$
|
24,946
|
|
Interest expense, net
|
|
|
|
|
4,531
|
|
|
|
|
4,665
|
|
|
|
|
3,260
|
|
|
|
|
17,605
|
|
|
|
|
12,529
|
|
Depreciation and amortization
|
|
|
|
|
21,640
|
|
|
|
|
21,360
|
|
|
|
|
19,631
|
|
|
|
|
85,238
|
|
|
|
|
71,156
|
|
Income tax
|
|
|
|
|
(219
|
)
|
|
|
|
1,083
|
|
|
|
|
-
|
|
|
|
|
1,085
|
|
|
|
|
103
|
|
EBITDA
|
|
|
|
$
|
(133,678
|
)
|
|
|
$
|
36,913
|
|
|
|
$
|
31,392
|
|
|
|
$
|
(50,345
|
)
|
|
|
$
|
108,734
|
|
Impairment of compression equipment
|
|
|
|
|
2
|
|
|
|
|
443
|
|
|
|
|
1,102
|
|
|
|
|
27,274
|
|
|
|
|
2,266
|
|
Impairment of goodwill
|
|
|
|
|
172,189
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
172,189
|
|
|
|
|
-
|
|
Interest income on capital lease
|
|
|
|
|
389
|
|
|
|
|
401
|
|
|
|
|
439
|
|
|
|
|
1,631
|
|
|
|
|
1,274
|
|
Unit-based compensation expense (1)
|
|
|
|
|
795
|
|
|
|
|
804
|
|
|
|
|
77
|
|
|
|
|
3,863
|
|
|
|
|
3,034
|
|
Transaction expenses for acquisitions (2)
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
18
|
|
|
|
|
-
|
|
|
|
|
1,299
|
|
Loss (gain) on sale of assets and other
|
|
|
|
|
(1,742
|
)
|
|
|
|
920
|
|
|
|
|
(4
|
)
|
|
|
|
(1,040
|
)
|
|
|
|
(2,198
|
)
|
Adjusted EBITDA
|
|
|
|
$
|
37,955
|
|
|
|
$
|
39,481
|
|
|
|
$
|
33,024
|
|
|
|
$
|
153,572
|
|
|
|
$
|
114,409
|
|
Interest expense, net
|
|
|
|
|
(4,531
|
)
|
|
|
|
(4,665
|
)
|
|
|
|
(3,260
|
)
|
|
|
|
(17,605
|
)
|
|
|
|
(12,529
|
)
|
Income tax expense
|
|
|
|
|
219
|
|
|
|
|
(1,083
|
)
|
|
|
|
-
|
|
|
|
|
(1,085
|
)
|
|
|
|
(103
|
)
|
Interest income on capital lease
|
|
|
|
|
(389
|
)
|
|
|
|
(401
|
)
|
|
|
|
(439
|
)
|
|
|
|
(1,631
|
)
|
|
|
|
(1,274
|
)
|
Transaction expenses for acquisitions
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
(18
|
)
|
|
|
|
-
|
|
|
|
|
(1,299
|
)
|
Amortization of deferred financing costs and other
|
|
|
|
|
416
|
|
|
|
|
416
|
|
|
|
|
307
|
|
|
|
|
1,702
|
|
|
|
|
1,189
|
|
Changes in operating assets and liabilities
|
|
|
|
|
988
|
|
|
|
|
445
|
|
|
|
|
1,676
|
|
|
|
|
(17,552
|
)
|
|
|
|
1,498
|
|
Net cash provided by operating activities
|
|
|
|
$
|
34,658
|
|
|
|
$
|
34,193
|
|
|
|
$
|
31,290
|
|
|
|
$
|
117,401
|
|
|
|
$
|
101,891
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the quarters ended December 31, 2015, September 30, 2015 and
December 31, 2014, unit-based compensation expense included $0.2 million
for each period of cash payments related to quarterly payments of
distribution equivalent rights on outstanding phantom unit awards. For
the year ended December 31, 2015 and 2014, unit-based compensation
expense included $0.9 million and $0.5 million, respectively, of cash
payments related to quarterly payments of distribution equivalent rights
on outstanding phantom unit awards and $0.2 million and $0.3 million,
respectively, related to the cash portion of any settlement of phantom
unit awards upon vesting. The remainder of the unit-based compensation
expense for each period presented in 2015 and 2014 is related to
non-cash adjustments to the unit-based compensation liability.
(2) Represents certain transaction expenses related to acquisitions,
potential acquisitions and other items. The Partnership believes it is
useful to investors to view its results excluding these fees.
USA COMPRESSION PARTNERS, LP AND SUBSIDIARIES RECONCILIATION
OF NON-GAAP FINANCIAL MEASURES NET INCOME (LOSS) TO
DISTRIBUTABLE CASH FLOW (In thousands, except for per unit
amounts — Unaudited)
The following table reconciles Distributable Cash Flow to net income
(loss) and net cash provided by operating activities, their most
directly comparable GAAP financial measures, for each of the periods
presented:
|
|
|
|
|
Three months ended
|
|
|
Year Ended
|
|
|
|
|
December 31,
|
|
|
September 30,
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
|
2015
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
Net income (loss)
|
|
|
|
$
|
(159,630
|
)
|
|
|
$
|
9,805
|
|
|
|
$
|
8,501
|
|
|
|
$
|
(154,273
|
)
|
|
|
$
|
24,946
|
|
Plus: Non-cash interest expense
|
|
|
|
|
416
|
|
|
|
|
416
|
|
|
|
|
307
|
|
|
|
|
1,702
|
|
|
|
|
1,224
|
|
Plus: Non-cash income tax expense
|
|
|
|
|
(202
|
)
|
|
|
|
1,076
|
|
|
|
|
-
|
|
|
|
|
874
|
|
|
|
|
-
|
|
Plus: Depreciation and amortization
|
|
|
|
|
21,640
|
|
|
|
|
21,360
|
|
|
|
|
19,631
|
|
|
|
|
85,238
|
|
|
|
|
71,156
|
|
Plus: Unit-based compensation expense (1)
|
|
|
|
|
795
|
|
|
|
|
804
|
|
|
|
|
77
|
|
|
|
|
3,863
|
|
|
|
|
3,034
|
|
Plus: Impairment of compression equipment
|
|
|
|
|
2
|
|
|
|
|
443
|
|
|
|
|
1,102
|
|
|
|
|
27,274
|
|
|
|
|
2,266
|
|
Plus: Impairment of goodwill
|
|
|
|
|
172,189
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
172,189
|
|
|
|
|
-
|
|
Plus: Transaction expenses for acquisitions (2)
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
18
|
|
|
|
|
-
|
|
|
|
|
1,299
|
|
Plus: Loss (gain) on sale of equipment and other
|
|
|
|
|
(1,148
|
)
|
|
|
|
1,324
|
|
|
|
|
(4
|
)
|
|
|
|
117
|
|
|
|
|
(2,198
|
)
|
Less: Maintenance capital expenditures (3)
|
|
|
|
|
(6,021
|
)
|
|
|
|
(2,959
|
)
|
|
|
|
(3,357
|
)
|
|
|
|
(16,134
|
)
|
|
|
|
(15,800
|
)
|
Distributable Cash Flow (4)
|
|
|
|
$
|
28,041
|
|
|
|
$
|
32,269
|
|
|
|
$
|
26,275
|
|
|
|
$
|
120,850
|
|
|
|
$
|
85,927
|
|
Plus: Maintenance capital expenditures
|
|
|
|
|
6,021
|
|
|
|
|
2,959
|
|
|
|
|
3,357
|
|
|
|
|
16,134
|
|
|
|
|
15,800
|
|
Plus: Change in working capital
|
|
|
|
|
988
|
|
|
|
|
445
|
|
|
|
|
1,676
|
|
|
|
|
(17,552
|
)
|
|
|
|
1,498
|
|
Less: Transaction expenses for acquisitions
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
(18
|
)
|
|
|
|
-
|
|
|
|
|
(1,299
|
)
|
Less: Other
|
|
|
|
|
(392
|
)
|
|
|
|
(1,480
|
)
|
|
|
|
-
|
|
|
|
|
(2,031
|
)
|
|
|
|
(35
|
)
|
Net cash provided by operating activities
|
|
|
|
$
|
34,658
|
|
|
|
$
|
34,193
|
|
|
|
$
|
31,290
|
|
|
|
$
|
117,401
|
|
|
|
$
|
101,891
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributable Cash Flow
|
|
|
|
|
28,041
|
|
|
|
|
32,269
|
|
|
|
|
26,275
|
|
|
|
|
120,850
|
|
|
|
|
85,927
|
|
Cash distributions to general partner and IDRs
|
|
|
|
|
702
|
|
|
|
|
697
|
|
|
|
|
546
|
|
|
|
|
2,658
|
|
|
|
|
1,947
|
|
Distributable Cash Flow attributable to limited partner interest
|
|
|
|
$
|
27,339
|
|
|
|
$
|
31,572
|
|
|
|
$
|
25,729
|
|
|
|
$
|
118,192
|
|
|
|
$
|
83,980
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions for Distributable Cash Flow Coverage Ratio (5)
|
|
|
|
$
|
27,618
|
|
|
|
$
|
25,290
|
|
|
|
$
|
23,131
|
|
|
|
$
|
101,266
|
|
|
|
$
|
85,098
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions reinvested in the DRIP (6)
|
|
|
|
$
|
15,982
|
|
|
|
$
|
15,179
|
|
|
|
$
|
13,600
|
|
|
|
$
|
60,002
|
|
|
|
$
|
52,556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions for Cash Coverage Ratio (7)
|
|
|
|
$
|
11,636
|
|
|
|
$
|
10,111
|
|
|
|
$
|
9,531
|
|
|
|
$
|
41,264
|
|
|
|
$
|
32,542
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributable Cash Flow Coverage Ratio (8)
|
|
|
|
|
0.99
|
|
|
|
|
1.25
|
|
|
|
|
1.11
|
|
|
|
|
1.17
|
|
|
|
|
0.99
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Coverage Ratio (9)
|
|
|
|
|
2.35
|
|
|
|
|
3.12
|
|
|
|
|
2.70
|
|
|
|
|
2.86
|
|
|
|
|
2.58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the quarters ended December 31, 2015, September 30, 2015 and
December 31, 2014, unit-based compensation expense included $0.2 million
for each period of cash payments related to quarterly payments of
distribution equivalent rights on outstanding phantom unit awards,
respectively. For the year ended December 31, 2015 and 2014, unit-based
compensation expense included $0.9 million and $0.5 million,
respectively, of cash payments related to quarterly payments of
distribution equivalent rights on outstanding phantom unit awards and
$0.2 million and $0.3 million, respectively, related to the cash portion
of any settlement of phantom unit awards upon vesting. The remainder of
the unit-based compensation expense for 2015 and 2014 is related to
non-cash adjustments to the unit-based compensation liability.
(2) Represents certain transaction expenses related to acquisitions,
potential acquisitions and other items. The Partnership believes it is
useful to investors to view its results excluding these fees.
(3) Reflects actual maintenance capital expenditures for the period
presented. Maintenance capital expenditures are capital expenditures
made to maintain the operating capacity of the Partnership’s assets and
extend their useful lives, replace partially or fully depreciated assets
or other capital expenditures that are incurred in maintaining the
Partnership’s existing business and related operating income.
(4) Distributable Cash Flow for the quarters ended September 30, 2015,
December 31, 2014 and for the year ended December 31, 2014 was
previously presented as Adjusted Distributable Cash Flow. The definition
of Distributable Cash Flow is identical to the definition of Adjusted
Distributable Cash Flow previously presented. See “Non-GAAP Financial
Measures” section above for the definition of Distributable Cash Flow.
(5) Represents distribution to the weighted average holders of the
Partnership’s units for each period.
(6) Represents distributions to holders enrolled in the DRIP as of the
record date for each period. Amounts for the three months ended December
31, 2015 and the year ended December 31, 2015 are based on an estimate
as of the record date.
(7) Represents cash distributions declared for weighted average common
units not participating in the DRIP for each period.
(8) For the three months ended September 30, 2015 the Distributable Cash
Flow Coverage Ratio based on units outstanding at the record date was
1.16x. For the years ended December 31, 2015 and 2014, the Distributable
Cash Flow Coverage Ratio based on units outstanding at the record date
was 1.15x and 0.97x, respectively.
(9) For the three months ended September 30, 2015, the Cash Coverage
Ratio based on units outstanding at the record date was 2.65x. For the
years ended December 31, 2015 and 2014, the Cash Coverage Ratio based on
units outstanding at the record date was 2.74x and 2.46x, respectively.
|
USA COMPRESSION PARTNERS, LP AND SUBSIDIARIES
|
FULL-YEAR 2016 ADJUSTED EBITDA AND DISTRIBUTABLE CASH FLOW
GUIDANCE RANGE
|
RECONCILIATION TO NET INCOME
|
(Unaudited)
|
|
|
|
|
|
Guidance
|
Net income
|
|
|
|
$20.6 million to $35.6 million
|
Plus: Interest expense
|
|
|
|
$22.4 million
|
Plus: Depreciation and amortization
|
|
|
|
$90.2 million
|
Plus: Income tax expense
|
|
|
|
$0.3 million
|
EBITDA
|
|
|
|
$133.5 million to $148.5 million
|
Plus: Interest income on capital lease
|
|
|
|
$1.4 million
|
Plus: Unit-based compensation expense (1)
|
|
|
|
$3.1 million
|
Adjusted EBITDA
|
|
|
|
$138.0 million to $153.0 million
|
Less: Cash interest expense
|
|
|
|
$20.7 million
|
Less: Current income tax expense
|
|
|
|
$0.3 million
|
Less: Maintenance capital expenditures
|
|
|
|
$15.0 million
|
Distributable Cash Flow
|
|
|
|
$102.0 million to $117.0 million
|
|
|
|
|
|
(1) Based on the Partnership's unit closing price as of December 31,
2015.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160210005504/en/
Source: USA Compression Partners, LP
USA Compression Partners, LP Matthew C. Liuzzi,
512-369-1624 Chief Financial Officer mliuzzi@usacompression.com or Michael
D. Lenox, 512-369-1632 VP of Finance mlenox@usacompression.com
|