Csi Compressco Lp (CCLP) 10-Q Quarterly Report May 2023

THE WOODLANDS, Texas (May 4, 2023) / PRNewswire / - CSI Compressco LP (“CSI,” or the “Partnership”) (NASDAQ: CCLP) today announced first quarter 2023 results.

First Quarter 2023 Results:

•Total revenues were $91.4 million compared to $80.0 million in the first quarter 2022.

•Contract services revenue increased to $69.6 million compared to $62.8 million in the first quarter 2022.

•Net loss was $2.6 million compared to a net loss of $6.6 million in the first quarter 2022.

•Adjusted EBITDA was $30.7 million compared to $26.9 million in the first quarter 2022.

•Trailing Twelve Months Adjusted EBITDA was $119.3 million.

•Compression fleet utilization increased to 87.4% compared to 81.4% in the first quarter 2022.

•Operating horsepower increased to 1,039,104 compared to 973,428 in the first quarter 2022.

•Distributable cash flow was $12.5 million compared to $10.3 million in the first quarter 2022.

•Distribution coverage ratio was 8.8x compared to 7.3x in the first quarter 2022.

•First quarter of 2023 distribution of $0.01 per common unit will be paid on May 15, 2023.

•Net Leverage Ratio was 5.3x compared to 5.9x in the first quarter 2022.

•CSI has no significant credit facility or debt maturities until 2025.

Management Commentary

John Jackson, CEO of CSI Compressco commented, “Our first quarter results reflect the strength of the natural gas compression market with continued improvement in EBITDA and leverage metrics. The forward outlook is encouraging as the visibility and sustainability of these results continues to improve.

Demand for medium and large HP (700 HP +) continues to grow as evidenced by the tight available supply and the sustained demand. This is reflected in the continued improvement in utilization rates as well as inbound requests from our customers for incremental new build large horsepower. Our overall fleet utilization improved to 87.4%; however, our reciprocating fleet improved to 93.3% and our reciprocating fleet represents over 82% of our total horsepower. Regarding the incremental new build demand, we have committed capital for 2023 and 2024 with signed contracts for large HP units for delivery later in 2023 and into the third quarter of 2024.

Our net leverage metric continues to improve, currently at 5.3x, with our full year guidance range of 4.8x - 5.2x remaining unchanged. We remain committed to limiting our capital spending during 2023 such that CSI Compressco will generate free cash flow.

The overall outlook for the natural gas compression sector has continued to improve with longer term contracts, increasing returns, limited, if any, speculative new build compression entering the market, and significant increase in new unit build costs, which improves the overall value of the existing underlying fleets. We continue to view the future with optimism as the visibility of strong results and activity lengthens and strengthens our earnings capability and accelerates the improvement in CSI Compressco’s leverage metrics.”

The following information was filed by Csi Compressco Lp (CCLP) on Thursday, May 4, 2023 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Csi Compressco Lp's 10-Q Quarterly Report:

Revenue - Product Highlight
Our potential sources of funds are our existing cash balances, cash generated from our operations, asset sales, and long-term and short-term borrowings, which we believe will be sufficient to meet our working capital and growth capital requirements during 2023.

Financial - Cash Flow Highlight
Management compensates for the limitations of Adjusted EBITDA and Free Cash Flow as analytical tools by reviewing the comparable U.S. GAAP measures, understanding the differences between the measures, and incorporating this knowledge into management's decision-making processes.
Revenue - Product Highlight
In addition, due to the improved market conditions, we implemented price increases resulting in increased revenues.
Other - Other Highlight
With the improvement in market conditions and the strong oil and gas commodity prices, customers have increased production of oil and gas which, in turn, increased the demand for parts and services needed to maintain their compression fleet.
Other - Other Highlight
For a discussion of new accounting pronouncements that may affect our consolidated financial statements, see Note 1 - "Organization, Basis of Presentation, and Significant Accounting Policies, New Accounting Pronouncements," in the Notes to Consolidated Financial Statements in this Quarterly Report.
Financial - Cash Flow
Cash Flows A summary of...Read more
Financial - Earnings
Our near-term focus is to...Read more
Financial - Cash Flow
Adjusted EBITDA and Free Cash...Read more
Financial - Cash Flow
These measures may not be...Read more
Financial - Expense
Interest expense, net Interest expense,...Read more
Revenue - Geography
External factors including Russia's invasion...Read more
Revenue - Product
Revenue from contract services increased...Read more
Other - Other
Critical Accounting Policies and Estimates...Read more
Revenue - Product
Equipment sales revenues decreased $0.6...Read more
Other - Other
This was driven by a...Read more
Revenue - Product
Three months ended March 31,...Read more
Revenue - Geography
Cash provided from our foreign...Read more
Other - Other
As of March 31, 2023,...Read more
Other - Other
Management primarily uses this metric...Read more
Financial - Income
The change in other (income)...Read more
Other - Other
Although uncertainty remains, the outlook...Read more
Financial - Cash Flow
Adjusted EBITDA and Free Cash...Read more
Other - Other
If the demand for compression...Read more
Other - Other
Risk Factors" and elsewhere in...Read more
Financial - Cash Flow
We define Free Cash Flow...Read more
Revenue - Product
19 Table of Contents Aftermarket...Read more
Other - Other
During 2023, oil and gas...Read more
Revenue - Product
The increase in revenues is...Read more
Other - Other
Oil and natural gas commodity...Read more
Other - Other
Forward-looking statements in this Quarterly...Read more
Other - Other
As of May 2, 2023,...Read more
Other - Other
As of May 2, 2023,...Read more
Revenue - Product
Equipment rentals revenues increased $0.6...Read more
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These capital expenditures include approximately...Read more
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Improved market conditions have provided...Read more
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Our labor costs consist primarily...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Csi Compressco Lp provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: CCLP
CIK: 1449488
Form Type: 10-Q Quarterly Report
Accession Number: 0001449488-23-000015
Submitted to the SEC: Thu May 04 2023 11:20:45 AM EST
Accepted by the SEC: Thu May 04 2023
Period: Friday, March 31, 2023
Industry: Oil And Gas Field Services