USA Compression Partners, LP Reports First Quarter 2021 Results; Confirms 2021 Outlook

Rhea-AI Summary

USA Compression Partners reported first-quarter 2021 results with total revenues of $157.5 million, down from $179.0 million in Q1 2020. Net income improved to $0.4 million, contrasting a significant net loss of $602.5 million in the prior year. Adjusted EBITDA was $99.6 million, showing a decrease from $106.2 million year-over-year. Distributable Cash Flow stood at $52.6 million, slightly lower than $54.7 million in Q1 2020. A cash distribution of $0.525 per common unit was announced, reflecting stable financial management amidst industry uncertainties.

Positive

• Improved net income to $0.4 million from a net loss of $602.5 million year-over-year.
• Continued cash distribution of $0.525 per common unit, consistent with Q1 2020.
• Strong operating margins supported by disciplined capital and expense management.
• Debt levels were better than anticipated for the first quarter.

Negative

• Total revenues decreased from $179.0 million in Q1 2020 to $157.5 million in Q1 2021.
• Adjusted EBITDA declined from $106.2 million in Q1 2020 to $99.6 million in Q1 2021.
• Net cash provided by operating activities decreased to $39.6 million from $50.1 million year-over-year.

USA Compression Partners, LP (NYSE: USAC) (“USA Compression” or the “Partnership”) announced today its financial and operating results for the first quarter 2021.

First Quarter 2021 Highlights

• Total revenues were $157.5 million for the first quarter 2021, compared to $179.0 million for the first quarter 2020.
• Net income was $0.4 million for the first quarter 2021, compared to a net loss of $602.5 million for the first quarter 2020.
• Net cash provided by operating activities was $39.6 million for the first quarter 2021, compared to $50.1 million for the first quarter 2020.
• Adjusted EBITDA was $99.6 million for the first quarter 2021, compared to $106.2 million for the first quarter 2020.
• Distributable Cash Flow was $52.6 million for the first quarter 2021, compared to $54.7 million for the first quarter 2020.
• Announced cash distribution of $0.525 per common unit for the first quarter 2021, consistent with the first quarter 2020.
• Distributable Cash Flow Coverage was 1.03x for the first quarter 2021, compared to 1.08x for the first quarter 2020.

“The first quarter of 2021 came in fairly consistent with the fourth quarter of 2020, reflecting what we expected would be a period of stability as we started the year,” commented Eric D. Long, USA Compression’s President and Chief Executive Officer. “While the general stability in both crude oil and natural gas prices has allowed customers to better plan their budgets and capital spending programs, lingering uncertainty around the timing of a recovery as well as the impact of potential legislative and regulatory changes on the industry have lent a cautious tone to overall activity.”

He continued, “With overall domestic natural gas production increasing modestly, we are now back at pre-COVID-19 levels, illustrating the importance of clean-burning natural gas to our country’s economy. While we acknowledge that renewable energy will increasingly become a more important contributor to our country’s energy needs, we believe the reliability and abundance of domestic natural gas will remain critical to serving our country’s energy needs.”

“As we previously discussed, our capital spending plans have been meaningfully reduced going into 2021. We continue to expect zero new unit deliveries during the year, instead spending nominal amounts of growth capital, primarily consisting of reconfigurations to prepare units for redeployment and first-time start-up costs. Partly as a result of this capital spending discipline, our debt levels and corresponding leverage were better than we expected for the first quarter.”

“While the recovery takes hold, we continue to focus on things within our control, namely capital spending and expense management. As you’ll note, our operating margins remain strong, reflecting continued focus on the core operations of the business, and helping improve Distributable Cash Flow coverage for the quarter.”

Expansion capital expenditures were $4.2 million, maintenance capital expenditures were $4.5 million and cash interest expense, net was $30.0 million for the first quarter 2021.

On April 14, 2021, the Partnership announced a first quarter cash distribution of $0.525 per common unit, which corresponds to an annualized distribution rate of $2.10 per common unit. The distribution will be paid on May 7, 2021 to common unitholders of record as of the close of business on April 26, 2021.

Operational and Financial Data
	Three Months Ended
	March 31, 2021				December 31, 2020				March 31, 2020
Operational data:
Fleet horsepower (at period end)	3,720,745				3,726,181				3,705,550
Revenue generating horsepower (at period end)	2,987,627				2,997,262				3,316,666
Average revenue generating horsepower	2,994,418				3,004,069				3,320,724
Revenue generating compression units (at period end)	3,942				3,968				4,516
Horsepower utilization (at period end) (1)	83.1		%		82.8		%		92.0		%
Average horsepower utilization (for the period) (1)	83.1		%		83.0		%		92.5		%
Financial data ($ in thousands, except per horsepower data):
Revenue	$	157,513			$	158,367			$	178,999
Average revenue per revenue generating horsepower per month (2)	$	16.60			$	16.55			$	16.89
Net income (loss) (3)	$	371			$	(1,474	)		$	(602,461	)
Operating income (loss) (3)	$	32,760			$	31,193			$	(569,710	)
Net cash provided by operating activities	$	39,612			$	97,547			$	50,077
Gross margin	$	47,855			$	48,480			$	61,072
Adjusted gross margin (4)(5)	$	108,885			$	108,276			$	119,834
Adjusted gross margin percentage	69.1		%		68.4		%		66.9		%
Adjusted EBITDA (5)	$	99,553			$	98,293			$	106,184
Adjusted EBITDA percentage	63.2		%		62.1		%

FAQ

What were USA Compression's total revenues in the first quarter of 2021?

Total revenues for USA Compression in the first quarter of 2021 were $157.5 million.

How did the net income of USA Compression change in Q1 2021 compared to Q1 2020?

USA Compression's net income improved to $0.4 million in Q1 2021, compared to a net loss of $602.5 million in Q1 2020.

What is the announced cash distribution for USA Compression for Q1 2021?

The announced cash distribution for Q1 2021 is $0.525 per common unit.

How does USA Compression's Adjusted EBITDA in Q1 2021 compare to Q1 2020?

Adjusted EBITDA in Q1 2021 was $99.6 million, down from $106.2 million in Q1 2020.

What was the Distributable Cash Flow for USA Compression in Q1 2021?

Distributable Cash Flow for USA Compression in Q1 2021 was $52.6 million.