Archrock Increases Quarterly Cash Dividend

Rhea-AI Summary

Archrock (NYSE: AROC) announced an increased quarterly dividend of $0.15 per share, reflecting a 3.3% increase from the previous quarter. The dividend will be paid on February 14, 2023 to shareholders on record as of February 7, 2023, which translates to $0.60 annually. The company reports strong demand in the natural gas sector and aims for a robust performance in 2023, with 93% horsepower utilization by the end of 2022. Archrock has reduced debt by over $300 million since 2019 and anticipates a leverage ratio below 4.0 times, supporting a healthy dividend coverage ratio of approximately 2.0 times in 2023.

Positive

• Quarterly dividend increased to $0.15 per share, a 3.3% rise.
• Strong demand for natural gas and compression market momentum.
• 93% horsepower utilization at the end of December 2022.
• Reduced debt by over $300 million since 2019.
• Projected leverage ratio below 4.0 times.

Negative

• None.

HOUSTON, Jan. 26, 2023 (GLOBE NEWSWIRE) -- Archrock, Inc. (NYSE: AROC) (“Archrock”) today announced that its Board of Directors has declared an increased quarterly dividend of $0.15 per share of common stock, or $0.60 per share on an annualized basis. The fourth quarter 2022 dividend will be paid on February 14, 2023 to all stockholders of record on February 7, 2023.

The fourth quarter 2022 dividend per share amount represents an increase of 3.3 percent over the Archrock third quarter 2022 dividend level.

“Resilient demand for natural gas, compression market momentum and strong execution set us up to deliver robust results in 2023, a year that we expect to lay the foundation for a multi-year upcycle in our business,” said Brad Childers, Archrock’s President and Chief Executive Officer. “With our horsepower utilization exiting December 2022 at 93%, we expect 2023 financial performance to benefit from a full year of record-high utilization and spot pricing.

“We have also made significant progress on our balance sheet over the past several years, including the repayment of more than $300 million in borrowings since the end of 2019. Proactive debt reduction and a visible increase in future earnings power give us line of sight to achieving a leverage ratio of below 4.0 times. Our increased dividend is supported by a consistent and prudent expected dividend coverage ratio of approximately 2.0 times in 2023.

“We remain committed to a balanced, all-of-the above capital allocation approach: investing in our business at attractive returns to grow profitably with our customers and increasing cash returned to our stockholders over time, while maintaining a healthy balance sheet and financial flexibility,” concluded Childers.

About Archrock

Archrock is an energy infrastructure company with a primary focus on midstream natural gas compression and a commitment to helping its customers produce, compress and transport natural gas in a safe and environmentally responsible way. Headquartered in Houston, Texas, Archrock is the leading provider of natural gas compression services to customers in the energy industry throughout the U.S. and a leading supplier of aftermarket services to customers that own compression equipment. For more information on how the Company embodies its purpose, WE POWER A CLEANER AMERICA™, visit www.archrock.com.

Forward-Looking Statements

This press release contains forward-looking statements, which include statements about Archrock’s future financial performance and dividends. These statements are not guarantees of future performance or actions. Forward-looking statements rely on a number of assumptions concerning future events and are subject to risks and uncertainties. If one or more of these risks or uncertainties materialize, actual results may differ materially from those contemplated by a forward-looking statement. Forward-looking statements speak only as of the date on which they are made. Archrock expressly disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. A further list and description of risks, uncertainties and other matters can be found in Archrock’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, and as set forth from time to time in Archrock’s filings with the Securities and Exchange Commission. These filings are available online at www.sec.gov and www.archrock.com.

For information, contact:

Megan Repine
Vice President, Investor Relations
(281) 836-8360
investor.relations@archrock.com

FAQ

What is the new dividend amount for Archrock in 2023?

Archrock's newly declared dividend is $0.15 per share, up from the previous quarter.

When will Archrock pay its fourth quarter 2022 dividend?

The dividend will be paid on February 14, 2023, to stockholders of record on February 7, 2023.

How has Archrock's debt changed since 2019?

Archrock has reduced its debt by more than $300 million since the end of 2019.

What is Archrock's anticipated leverage ratio for 2023?

Archrock anticipates achieving a leverage ratio below 4.0 times in 2023.

What is the expected dividend coverage ratio for Archrock in 2023?

Archrock expects a dividend coverage ratio of approximately 2.0 times in 2023.