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Kodiak Gas Services, Inc. (NYSE: KGS) is one of the largest providers of contract compression services in the United States. The company operates through two primary segments: Compression Operations and Other Services. In the Compression Operations segment, Kodiak runs both company-owned and customer-owned infrastructure under fixed-revenue contracts, facilitating the production, gathering, and transportation of natural gas and oil. This segment includes a fleet generating over 3.2 million horsepower, serving clients in high-volume gas gathering systems, processing facilities, multi-well gas lift applications, and natural gas transmission systems. The Other Services segment includes comprehensive contract services such as station construction, maintenance, overhaul, and other ancillary offerings.
Recently, Kodiak has achieved several significant milestones. In February 2024, the SEC declared effective Kodiak's registration statement related to its merger with CSI Compressco LP, marking a pivotal step towards creating the largest contract compression fleet in the industry. The merger, expected to close in the second quarter of 2024, aims to enhance service offerings and operational scale.
Financially, Kodiak reported strong performance in 2023, achieving record annual revenue and Adjusted EBITDA. The company’s focus on large horsepower compression infrastructure, particularly in the Permian Basin, has driven growth, with revenues from Compression Operations increasing by 12.3% to $735.6 million in 2023. This segment also saw an improvement in gross margin by 16% to $295.6 million. The Other Services segment more than doubled its revenue from the previous year, finishing 2023 with $114.8 million.
For 2024, Kodiak anticipates continued strong demand for its services, buoyed by the growing need for natural gas infrastructure to support LNG export projects. The company is fully contracted for its new unit deliveries for 2024 and is actively discussing future needs with its customers for 2025. With a committed strategy to maintain the safest and most sustainable contract compression fleet, Kodiak continues to prioritize delivering high-quality service and mechanical availability to its customers.
Further, Kodiak's financial health remains robust, with total debt at $1.8 billion as of December 2023. The company successfully issued $750 million in senior unsecured notes due 2029, primarily to reduce existing ABL Facility borrowings. Post-merger, Kodiak's liquidity remains strong with plans to utilize its ABL Facility to manage CSI Compressco's outstanding debts.
For investors and stakeholders, Kodiak’s focus on disciplined capital allocation, including growth in its compression fleet and attractive returns through dividends, underscores its commitment to long-term value creation.
EQT, through its infrastructure funds III and IV, has completed an underwritten public offering of 5,500,000 shares of Kodiak Gas Services (NYSE: KGS) common stock. The offering generated gross proceeds of $232,925,000. Goldman Sachs & Co. and J.P. Morgan served as the underwriters for the offering, which was completed on December 13, 2024. Notably, Kodiak Gas Services did not participate in the share sale and received no proceeds from the transaction.
Kodiak Gas Services (NYSE: KGS) has announced the pricing of an underwritten offering of 5,500,000 shares of its common stock by an affiliate of EQT Infrastructure III and IV funds. The offering will generate total gross proceeds of $232,925,000. Kodiak will not sell any shares or receive any proceeds from this offering. The offering is expected to close on December 13, 2024.
Goldman Sachs & Co. and J.P. Morgan are serving as the underwriters for the offering, which is being conducted through a prospectus supplement and base prospectus filed with the SEC under an automatic shelf registration statement that became effective on July 10, 2024.
Kodiak Gas Services (NYSE: KGS) announced a public offering of 5,500,000 shares of common stock by an affiliate of EQT Infrastructure III and EQT Infrastructure IV funds. The company will not sell any shares or receive proceeds from this offering. Goldman Sachs & Co. and J.P. Morgan are acting as underwriters. The offering will be conducted through a prospectus supplement and base prospectus filed under an automatic shelf registration statement on Form S-3, which became effective on July 10, 2024.
Kodiak Gas Services (NYSE: KGS) announced the pricing of an upsized public offering of 5,708,885 shares at $34.50 per share by EQT Infrastructure funds. The underwriters have a 30-day option for additional 856,332 shares. Concurrent with the offering's closing, Kodiak plans to repurchase $15 million worth of shares (434,783 shares) from the selling stockholder at the public offering price. This repurchase is part of the company's $50 million share repurchase program, leaving $35 million remaining after completion. The offering is expected to close on November 18, 2024.
Kodiak Gas Services (NYSE: KGS) announced a public offering of 4,853,556 shares of common stock by an affiliate of EQT Infrastructure III and IV funds. The selling stockholder may grant underwriters a 30-day option for additional 728,034 shares. Kodiak will not receive any proceeds from the offering. The company plans to privately purchase $15 million of common stock from the selling stockholder at the public offering price. The total offering will be 6,000,000 shares less the shares repurchased by the company. This repurchase is part of Kodiak's existing $50 million share repurchase program, leaving $35 million remaining after completion.
Kodiak Gas Services (NYSE: KGS) has announced a $50 million share repurchase program approved by its Board of Directors. The program will run through December 31, 2025, allowing the company to repurchase shares through open market transactions or privately negotiated deals. The repurchases will comply with Rule 10b-18 requirements, and the company may implement Rule 10b5-1 plans. While not obligated to purchase any specific amount, Kodiak maintains flexibility to suspend or terminate the program based on factors including price, market conditions, and alternative investment opportunities.
Kodiak Gas Services (NYSE: KGS) reported record Q3 2024 financial results, with Contract Services revenue of $284.3 million and record quarterly Adjusted EBITDA of $168.4 million. Despite posting a net loss of $6.2 million due to asset impairments and hedging losses, the company achieved record quarterly Free Cash Flow of $52.5 million. Fleet utilization improved to 96.4%. The company raised its full-year 2024 Adjusted EBITDA guidance to $600-610 million and provided a 2025 outlook of $675-725 million. During the quarter, Kodiak deployed 50,000 horsepower of new compression units while divesting 95,000 horsepower of small units.
Kodiak Gas Services (NYSE: KGS) has announced a quarterly cash dividend of $0.41 per share for Q3 2024, payable on November 8, 2024, to stockholders of record as of November 1, 2024. Concurrently, Kodiak Gas Services, , a subsidiary, declared a distribution of $0.41 per unit for Q3 2024 with the same record and payment dates.
The company will release its Q3 2024 financial results on November 6, 2024 after market close. A conference call is scheduled for November 7, 2024, at 11:00 a.m. Eastern Time to discuss the results. Investors can join via phone or webcast, with replay options available until November 21, 2024.
Kodiak Gas Services (NYSE: KGS) announced the pricing of a public offering of 6,086,957 shares of its common stock by an affiliate of EQT Infrastructure III and IV funds at $25.00 per share. The underwriters have a 30-day option to purchase up to 913,043 additional shares. Kodiak will not receive any proceeds from the sale. The offering is expected to close on September 11, 2024. Concurrent with the closing, Kodiak plans to repurchase $25 million of common stock from the selling stockholder at the public offering price. Barclays, Goldman Sachs & Co. , and J.P. Morgan are acting as joint book-running managers for the offering.
Kodiak Gas Services (NYSE: KGS) has announced a public offering of 6,140,182 shares of its common stock by an affiliate of EQT Infrastructure III and IV funds. The underwriters have a 30-day option to purchase an additional 921,027 shares. Kodiak will not sell any shares or receive proceeds from this offering. The company plans to repurchase $25 million worth of shares from the selling stockholder in a private transaction at the public offering price. The total offering will be 8,000,000 shares minus the number of shares Kodiak repurchases. Barclays, Goldman Sachs & Co. , and J.P. Morgan are joint book-running managers for the offering, which is subject to market conditions.
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