Exterran Partners, L.P. (NASDAQ: EXLP) today reported EBITDA, as further adjusted (as defined below), of $48.9 million for the fourth quarter 2012, compared to $46.2 million for the third quarter 2012 and $37.5 million for the fourth quarter 2011. Distributable cash flow (as defined below) was $34.2 million for the fourth quarter 2012, compared to $29.5 million for the third quarter 2012 and $24.5 million for the fourth quarter 2011.
Revenue was $102.3 million for the fourth quarter 2012, compared to $99.3 million for the third quarter 2012 and $83.3 million for the fourth quarter 2011.
Net income was $14.7 million for the fourth quarter 2012, or $0.31 per diluted limited partner unit, compared to net income of $10.4 million, or $0.21 per diluted limited partner unit, for the third quarter 2012, and net income of $4.5 million, or $0.10 per diluted limited partner unit, for the fourth quarter 2011.
EBITDA, as further adjusted, was $180.0 million for 2012, compared to $139.3 million for 2011. Distributable cash flow totaled $118.0 million for 2012, compared to $90.3 million in 2011.
Revenue was $387.5 million for 2012, compared to $308.3 million for 2011. Net income for 2012 was $10.5 million, or $0.14 per diluted limited partner unit, compared to net income of $6.1 million, or $0.09 per diluted limited partner unit, for 2011.
“In 2012, we continued to grow the Partnership through the execution of our drop-down strategy with Exterran Holdings. We also invested in new fleet units to modernize and position our fleet for growth. Additionally, we benefitted from the implementation of performance improvement initiatives by Exterran Holdings,” said Brad Childers, Chairman, President and Chief Executive Officer of Exterran Partners’ managing general partner.
“In the fourth quarter, Exterran Partners reported its second consecutive quarter of solid organic growth, as operating horsepower increased by 50,000. Distributable cash flow increased by 16% compared to the third quarter 2012, to a quarterly record of $34.2 million.
“We are optimistic about the overall outlook in 2013 and beyond driven by the continuing industry development of infrastructure in liquids rich and shale plays in the United States and the implementation of our growth strategies, though organic growth in the first half of the year is expected to be modest.”
For the fourth quarter 2012, Exterran Partners’ quarterly cash distribution was $0.5125 per limited partner unit, or $2.05 per limited partner unit on an annualized basis. The fourth-quarter 2012 distribution was $0.005 per limited partner unit higher than the third-quarter 2012 distribution of $0.5075 per limited partner unit and $0.02 per limited partner unit higher than the fourth-quarter 2011 distribution of $0.4925 per limited partner unit.
Conference Call Details
Exterran Partners and Exterran Holdings, Inc. will host a joint conference call on Tuesday, Feb. 26, 2013, to discuss their fourth-quarter 2012 financial results. The call will begin at 11:00 a.m. Eastern Time.
To listen to the call via a live webcast, please visit Exterran’s website at www.exterran.com. The call will also be available by dialing 800-446-2782 in the United States and Canada, or +1-847-413-3235 for international calls. Please call approximately 15 minutes prior to the scheduled start time and reference Exterran conference call number 34069963.
A replay of the conference call will be available on Exterran’s website for approximately seven days. Also, a replay may be accessed by dialing 888-843-7419 in the United States and Canada, or +1-630-652-3042 for international calls. The access code is 34069963#.
EBITDA, as further adjusted, a non-GAAP measure, is defined as net income (loss) excluding income taxes, interest expense (including debt extinguishment costs and gain or loss on termination of interest rate swaps), depreciation and amortization expense, impairment charges, other charges, non-cash selling, general and administrative (“SG&A”) costs and any amounts by which cost of sales and SG&A costs are reduced as a result of caps on these costs contained in the omnibus agreement to which Exterran Holdings and Exterran Partners are parties (the “Omnibus Agreement”), which amounts are treated as capital contributions from Exterran Holdings for accounting purposes.
Distributable cash flow, a non-GAAP measure, is defined as net income (loss) plus depreciation and amortization expense, impairment charges, non-cash SG&A costs, interest expense and any amounts by which cost of sales and SG&A costs are reduced as a result of caps on these costs contained in the Omnibus Agreement, which amounts are treated as capital contributions from Exterran Holdings for accounting purposes, less cash interest expense (excluding amortization of deferred financing fees and costs incurred to terminate interest rate swaps early) and maintenance capital expenditures, and excluding gains/losses on asset sales and other charges.
Gross Margin, a non-GAAP measure, is defined as total revenue less cost of sales (excluding depreciation and amortization expense). Gross margin percentage is defined as gross margin divided by revenue.
About Exterran Partners
Exterran Partners, L.P. is the leading provider of natural gas contract operations services to customers throughout the United States. Exterran Holdings, Inc. (NYSE: EXH) owns an equity interest in Exterran Partners, including all of the general partner interest. For more information, visit www.exterran.com.
Forward-Looking Statements
All statements in this release (and oral statements made regarding the subjects of this release) other than historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors, many of which are outside Exterran Partners’ control, which could cause actual results to differ materially from such statements. Forward-looking information includes, but is not limited to: Exterran Partners’ financial and operational strategies and ability to successfully effect those strategies; Exterran Partners’ expectations regarding future economic and market conditions; Exterran Partners’ financial and operational outlook and ability to fulfill that outlook; and demand for Exterran Partners’ services and growth opportunities for those services.
While Exterran Partners believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Among the factors that could cause results to differ materially from those indicated by such forward-looking statements are: local, regional and national economic conditions and the impact they may have on Exterran Partners and its customers; changes in tax laws that impact master limited partnerships; conditions in the oil and gas industry, including a sustained decrease in the level of supply or demand for oil or natural gas or a sustained decrease in the price of oil or natural gas; changes in economic conditions in key operating markets; changes in safety, health, environmental and other regulations; and the performance of Exterran Holdings.
These forward-looking statements are also affected by the risk factors, forward-looking statements and challenges and uncertainties described in Exterran Partners’ Annual Report on Form 10-K for the year ended December 31, 2011 and those set forth from time to time in Exterran Partners’ filings with the Securities and Exchange Commission, which are currently available at www.exterran.com. Except as required by law, Exterran Partners expressly disclaims any intention or obligation to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.
(Tables Follow)
| EXTERRAN PARTNERS, L.P. | |||||||||||||||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||
| (In thousands, except per unit amounts) | |||||||||||||||||||||
| Three Months Ended | Years Ended | ||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||||||||||||||||
| 2012 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||
| Revenue | $ | 102,301 | $ | 99,324 | $ | 83,267 | $ | 387,493 | $ | 308,274 | |||||||||||
| Costs and expenses: | |||||||||||||||||||||
| Cost of sales (excluding depreciation and amortization) | 44,949 | 48,652 | 42,694 | 183,160 | 162,925 | ||||||||||||||||
| Depreciation and amortization | 23,218 | 21,930 | 19,235 | 88,298 | 67,930 | ||||||||||||||||
| Long-lived asset impairment | 633 | - | 371 | 29,560 | 1,060 | ||||||||||||||||
| Selling, general and administrative | 12,455 | 11,762 | 8,643 | 49,889 | 39,380 | ||||||||||||||||
| Interest expense | 6,421 | 6,465 | 7,912 | 25,167 | 30,400 | ||||||||||||||||
| Other (income) expense, net | (164 | ) | (137 | ) | (288 | ) | (35 | ) | (392 | ) | |||||||||||
| Total costs and expenses | 87,512 | 88,672 | 78,567 | 376,039 | 301,303 | ||||||||||||||||
| Income before income taxes | 14,789 | 10,652 | 4,700 | 11,454 | 6,971 | ||||||||||||||||
| Income tax provision | 115 | 272 | 185 | 945 | 918 | ||||||||||||||||
| Net income | $ | 14,674 | $ | 10,380 | $ | 4,515 | $ | 10,509 | $ | 6,053 | |||||||||||
| General partner interest in net income | $ | 1,493 | $ | 1,343 | $ | 920 | $ | 4,623 | $ | 3,005 | |||||||||||
| Limited partner interest in net income | $ | 13,181 | $ | 9,037 | $ | 3,595 | $ | 5,886 | $ | 3,048 | |||||||||||
| Weighted average limited partners' units outstanding: | |||||||||||||||||||||
| Basic | 42,266 | 42,264 | 37,270 | 41,371 | 35,137 | ||||||||||||||||
| Diluted | 42,280 | 42,280 | 37,291 | 41,382 | 35,150 | ||||||||||||||||
| Earnings per limited partner unit: | |||||||||||||||||||||
| Basic | $ | 0.31 | $ | 0.21 | $ | 0.10 | $ | 0.14 | $ | 0.09 | |||||||||||
| Diluted | $ | 0.31 | $ | 0.21 | $ | 0.10 | $ | 0.14 | $ | 0.09 | |||||||||||
| EXTERRAN PARTNERS, L.P. | |||||||||||||||||||||
| UNAUDITED SUPPLEMENTAL INFORMATION | |||||||||||||||||||||
| (In thousands, except per unit amounts and percentages) | |||||||||||||||||||||
| Three Months Ended | Years Ended | ||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | |||||||||||||||||
| 2012 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||
| Revenue | $ | 102,301 | $ | 99,324 | $ | 83,267 | $ | 387,493 | $ | 308,274 | |||||||||||
Gross Margin (1) | $ | 57,352 | $ | 50,672 | $ | 40,573 | $ | 204,333 | $ | 145,349 | |||||||||||
| Gross Margin percentage | 56 | % | 51 | % | 49 | % | 53 | % | 47 | % | |||||||||||
EBITDA, as further adjusted (1) | $ | 48,902 | $ | 46,150 | $ | 37,513 | $ | 180,034 | $ | 139,290 | |||||||||||
| % of Revenue | 48 | % | 46 | % | 45 | % | 46 | % | 45 | % | |||||||||||
| Capital Expenditures | $ | 66,130 | $ | 40,243 | $ | 17,106 | $ | 157,828 | $ | 50,250 | |||||||||||
| Less: Proceeds from Sale of Compression Equipment | (859 | ) | (603 | ) | (632 | ) | (2,465 | ) | (2,940 | ) | |||||||||||
| Net Capital Expenditures | $ | 65,271 | $ | 39,640 | $ | 16,474 | $ | 155,363 | $ | 47,310 | |||||||||||
Distributable cash flow (2) | $ | 34,223 | $ | 29,501 | $ | 24,475 | $ | 117,966 | $ | 90,284 | |||||||||||
| Distributions Declared for the period per Limited Partner Unit | $ | 0.5125 | $ | 0.5075 | $ | 0.4925 | $ | 2.0200 | $ | 1.9400 | |||||||||||
Distribution Declared to All Unitholders for the period, including Incentive Distributions | $ | 23,331 | $ | 23,044 | $ | 19,581 | $ | 91,617 | $ | 74,214 | |||||||||||
Distributable Cash Flow Coverage | 1.47x | 1.28x | 1.25x | 1.29x | 1.22x | ||||||||||||||||
| |||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | |||||||||||||||||
| 2012 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||
| Debt | $ | 680,500 | $ | 664,500 | $ | 545,500 | $ | 680,500 | $ | 545,500 | |||||||||||
| Total Partners' Capital | $ | 439,000 | $ | 452,419 | $ | 423,766 | $ | 439,000 | $ | 423,766 | |||||||||||
| Total Debt to Capitalization | 61 | % | 59 | % | 56 | % | 61 | % | 56 | % | |||||||||||
| (1) | Management believes disclosure of EBITDA, as further adjusted, and Gross Margin, both non-GAAP measures, provides useful information to investors because these measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review current period operating performance, comparability measures and performance measures for period to period comparisons. In addition, management uses EBITDA, as further adjusted, as a valuation measure. | |
| (2) | Distributable cash flow, a non-GAAP measure, is a significant liquidity metric used by management to compare basic cash flows to the cash distributions we expect to pay our partners. Using this metric, management can quickly compute the coverage ratio of estimated cash flows to planned cash distributions. | |
| EXTERRAN PARTNERS, L.P. | |||||||||||||||||||||
| UNAUDITED SUPPLEMENTAL INFORMATION | |||||||||||||||||||||
| (In thousands, except per unit amounts) | |||||||||||||||||||||
| Three Months Ended | Years Ended | ||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | |||||||||||||||||
| 2012 | 2012 | 2011 | 2012 | 2011 | |||||||||||||||||
| Reconciliation of GAAP to Non-GAAP Financial Information: | |||||||||||||||||||||
| Net income | $ | 14,674 | $ | 10,380 | $ | 4,515 | $ | 10,509 | $ | 6,053 | |||||||||||
| Depreciation and amortization | 23,218 | 21,930 | 19,235 | 88,298 | 67,930 | ||||||||||||||||
| Long-lived asset impairment | 633 | - | 371 | 29,560 | 1,060 | ||||||||||||||||
| Selling, general and administrative | 12,455 | 11,762 | 8,643 | 49,889 | 39,380 | ||||||||||||||||
| Interest expense | 6,421 | 6,465 | 7,912 | 25,167 | 30,400 | ||||||||||||||||
| Other (income) expense, net | (164 | ) | (137 | ) | (288 | ) | (35 | ) | (392 | ) | |||||||||||
| Income tax provision | 115 | 272 | 185 | 945 | 918 | ||||||||||||||||
Gross Margin (1) | 57,352 | 50,672 | 40,573 | 204,333 | 145,349 | ||||||||||||||||
| Cap on operating costs provided by Exterran Holdings ("EXH") | 1,886 | 5,841 | 5,073 | 16,562 | 26,492 | ||||||||||||||||
| Cap on selling, general and administrative costs provided by EXH | 1,815 | 1,090 | - | 8,196 | 5,905 | ||||||||||||||||
| Non-cash selling, general and administrative costs | 140 | 172 | 222 | 797 | 532 | ||||||||||||||||
| Less: Selling, general and administrative | (12,455 | ) | (11,762 | ) | (8,643 | ) | (49,889 | ) | (39,380 | ) | |||||||||||
| Less: Other income (expense), net | 164 | 137 | 288 | 35 | 392 | ||||||||||||||||
EBITDA, as further adjusted (1) | 48,902 | 46,150 | 37,513 | 180,034 | 139,290 | ||||||||||||||||
| Expensed acquisition costs (in Other (income) expense, net) | - | - | - | 695 | 514 | ||||||||||||||||
| Less: Income tax provision | (115 | ) | (272 | ) | (185 | ) | (945 | ) | (918 | ) | |||||||||||
| Less: Gain on sale of compression equipment (in Other (income) expense, net) | (144 | ) | (127 | ) | (273 | ) | (689 | ) | (919 | ) | |||||||||||
| Less: Cash interest expense | (5,930 | ) | (5,905 | ) | (5,012 | ) | (22,761 | ) | (18,822 | ) | |||||||||||
| Less: Maintenance capital expenditures | (8,490 | ) | (10,345 | ) | (7,568 | ) | (38,368 | ) | (28,861 | ) | |||||||||||
Distributable cash flow (2) | $ | 34,223 | $ | 29,501 | $ | 24,475 | $ | 117,966 | $ | 90,284 | |||||||||||
| Cash flows from operating activities | $ | 45,607 | $ | 33,294 | $ | 26,370 | $ | 125,217 | $ | 80,090 | |||||||||||
| (Provision for) benefit from doubtful accounts | (94 | ) | 145 | 185 | (494 | ) | (83 | ) | |||||||||||||
| Cap on operating costs provided by EXH | 1,886 | 5,841 | 5,073 | 16,562 | 26,492 | ||||||||||||||||
| Cap on selling, general and administrative costs provided by EXH | 1,815 | 1,090 | - | 8,196 | 5,905 | ||||||||||||||||
| Expensed acquisition costs | - | - | - | 695 | 514 | ||||||||||||||||
| Maintenance capital expenditures | (8,490 | ) | (10,345 | ) | (7,568 | ) | (38,368 | ) | (28,861 | ) | |||||||||||
| Change in assets and liabilities | (6,501 | ) | (524 | ) | 415 | 6,158 | 6,227 | ||||||||||||||
Distributable cash flow (2) | $ | 34,223 | $ | 29,501 | $ | 24,475 | $ | 117,966 | $ | 90,284 | |||||||||||
| Net income | $ | 14,674 | $ | 10,380 | $ | 4,515 | $ | 10,509 | $ | 6,053 | |||||||||||
| Long-lived asset impairment | 633 | - | 371 | 29,560 | 1,060 | ||||||||||||||||
| Net income, excluding charge | $ | 15,307 | $ | 10,380 | $ | 4,886 | $ | 40,069 | $ | 7,113 | |||||||||||
| Diluted earnings per limited partner unit | $ | 0.31 | $ | 0.21 | $ | 0.10 | $ | 0.14 | $ | 0.09 | |||||||||||
| Adjustment for charge per limited partner unit | 0.02 | - | 0.01 | 0.70 | 0.03 | ||||||||||||||||
Diluted earnings per limited partner unit, excluding charge (1) | $ | 0.33 | $ | 0.21 | $ | 0.11 | $ | 0.84 | $ | 0.12 | |||||||||||
| (1) | Management believes disclosure of EBITDA, as further adjusted, Diluted earnings (loss) per limited partner unit, excluding charge, and Gross Margin, non-GAAP measures, provides useful information to investors because these measures, when viewed with our GAAP results and accompanying reconciliations, provide a more complete understanding of our performance than GAAP results alone. Management uses these non-GAAP measures as supplemental measures to review current period operating performance, comparability measures and performance measures for period to period comparisons. In addition, management uses EBITDA, as further adjusted, as a valuation measure. | |
| (2) | Distributable cash flow, a non-GAAP measure, is a significant liquidity metric used by management to compare basic cash flows to the cash distributions we expect to pay our partners. Using this metric, management can quickly compute the coverage ratio of estimated cash flows to planned cash distributions. | |
| EXTERRAN PARTNERS, L.P. | ||||||||||||||||
| UNAUDITED SUPPLEMENTAL INFORMATION | ||||||||||||||||
| (In thousands, except percentages) | ||||||||||||||||
| Three Months Ended | Years Ended | |||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||
| 2012 | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Total Available Horsepower (at period end) (1) | 2,084 | 2,022 | 1,873 | 2,084 | 1,873 | |||||||||||
Total Operating Horsepower (at period end) (1) | 1,991 | 1,941 | 1,728 | 1,991 | 1,728 | |||||||||||
| Average Operating Horsepower | 1,960 | 1,924 | 1,706 | 1,883 | 1,549 | |||||||||||
| Horsepower Utilization: | ||||||||||||||||
| Spot (at period end) | 96 | % | 96 | % | 92 | % | 96 | % | 92 | % | ||||||
| Average | 96 | % | 95 | % | 91 | % | 93 | % | 89 | % | ||||||
Combined U.S. Contract Operations Horsepower of Exterran Holdings and Exterran Partners covered by contracts converted to service agreements (at period end) | 2,368 | 2,296 | 2,188 | 2,368 | 2,188 | |||||||||||
| Available Horsepower: | ||||||||||||||||
Total Available U.S. Contract Operations Horsepower of Exterran Holdings and Exterran Partners (at period end) | 3,376 | 3,341 | 3,545 | 3,376 | 3,545 | |||||||||||
% of U.S. Contract Operations Available Horsepower of Exterran Holdings and Exterran Partners covered by contracts convertedto service agreements (at period end) | 70 | % | 69 | % | 62 | % | 70 | % | 62 | % | ||||||
| Operating Horsepower: | ||||||||||||||||
Total Operating U.S. Contract Operations Horsepower of Exterran Holdings and Exterran Partners (at period end) | 2,900 | 2,849 | 2,830 | 2,900 | 2,830 | |||||||||||
% of U.S. Contract Operations Operating Horsepower of Exterran Holdings and Exterran Partners covered by contracts converted to service agreements (at period end) | 82 | % | 81 | % | 77 | % | 82 | % | 77 | % | ||||||
| (1) | Includes compressor units leased from Exterran Holdings with an aggregate horsepower of approximately 163,000, 161,000 and 221,000 at December 31, 2012, September 30, 2012 and December 31, 2011, respectively. Excludes compressor units leased to Exterran Holdings with an aggregate horsepower of approximately 9,000, 9,000 and 18,000 at December 31, 2012, September 30, 2012 and December 31, 2011, respectively. |
Exterran Partners, L.P.
Media
Susan Moore, 281-836-7398
or
Investors
David
Oatman, 281-836-7035
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