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USA Compression (USAC) Q2 Loss Wider Than Estimates, Sales Up

·4 min read

USA Compression Partners, LP USAC reported a second-quarter 2022 net loss of 3 cents per common unit, marginally wider than the Zacks Consensus Estimate of a loss of 2 cents, due to higher total costs and expenses.

However, the loss was narrower than the year-ago quarter’s loss of 10 cents per share. This favorable comparison was due to the partnership posting a net income of $9.1 million for the second quarter of 2022 compared with the net income of just $2.7 million for the same period last year.

Revenues of $171.5 million were approximately 9.5% higher than the year-ago quarter’s reading of $156.6 million.

Adjusted EBITDA increased about 5.4% to $105.4 million from the last year’s second-quarter figure of $99.9 million. Moreover, the partnership’s distributable cash flow rose from $52.5 million in the prior-year quarter to $55.6 million.

The firm reported operating cash flow of $94.2 million in the quarter, down from the $99.5 million generated in the prior-year quarter. Also, its gross operating margin of 67.8% declined from the year-ago period’s 70.9%.

In the second quarter, USA Compression Partners’ revenue-generating horsepower capacity increased about 2.8% to 3,027,886 horsepower from the level recorded in the corresponding period of last year.  Average monthly revenues per horsepower were $17.20, higher than the year-ago quarter’s figure of $16.55. USAC’s average quarterly horsepower utilization rate came in at 87.9%, higher than 82.4% in the year-ago period.

USA Compression Partners, LP Price, Consensus and EPS Surprise

USA Compression Partners, LP Price, Consensus and EPS Surprise
USA Compression Partners, LP Price, Consensus and EPS Surprise

USA Compression Partners, LP price-consensus-eps-surprise-chart | USA Compression Partners, LP Quote

DCF, Capex & Balance Sheet

USA Compression Partners’ DCF available to limited partners for the second quarter equaled $55.6 million (providing 1.08X distribution coverage), up 5.9% from the year-ago level. On Jul 14, the firm announced a second-quarter cash distribution of 52.50 cents per unit ($2.10 on an annualized basis). The distribution will be paid out on Aug 5, 2022 to common unitholders of record as of Jul 25, 2022.

It spent $32.2 million as growth capex. The partnership’s maintenance capex amounted to $6.1 million.

As of June 2022, USA Compression Partners had about $2.02 billion of net long-term debt.

Guidance

For 2022, USAC maintained its DCF guidance of $213 million to $233 million. It still estimates the adjusted EBITDA outlook within the $406-$426 million range.

Additionally, the firm still expects its net income for the year in the range of $33 million-$53 million.

Zacks Rank & Key Picks

USA Compression Partners currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the energy space that warrant a look include California Resources CRC, Equinor EQNR and BP BP, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for California Resources’ 2022 earnings has been revised about 10.6% upward over the past 60 days from $6.50 per share to $7.19.

The Zacks Consensus Estimate for CRC’s 2022 earnings is pegged at $7.19 per share, up 17.9% from the year-ago earnings of $6.10.

Equinor beat the Zacks Consensus Estimate for earnings in all the trailing four quarters, the average being around 7.3%.

The Zacks Consensus Estimate for EQNR’s 2022 earnings stands at $6.15 per share, up about 99.7% from the year-ago earnings of $3.08.

The Zacks Consensus Estimate for BP’s 2022 earnings is pegged at $7.89 per share, which is an increase of about 106.5% from the year-ago earnings of $3.82.

BP beat the Zacks Consensus Estimate for earnings in all the trailing four quarters, the average being around 15.5%.


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