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Dec 31, 2019
Archrock Q4 2019 Earnings Report
Achieved record net income and increased adjusted EBITDA.
Key Takeaways
Archrock reported a net income of $46.0 million for Q4 2019, which included a non-cash benefit of $39.6 million from the release of a deferred tax asset valuation allowance and a non-cash long-lived asset impairment of $25.8 million. Adjusted EBITDA for the fourth quarter of 2019 was $112.5 million, up 15% compared to the fourth quarter of 2018. The company's contract operations segment saw a revenue increase of 16%, while the aftermarket services segment experienced a revenue decrease due to customer deferral of maintenance activities.
Net income for the fourth quarter was $46.0 million, compared to $13.0 million in the fourth quarter of 2018.
Adjusted EBITDA for the fourth quarter of 2019 was $112.5 million, up 15% compared to the fourth quarter of 2018.
Contract operations segment revenue totaled $204.4 million, a 16% increase compared to $176.4 million in the fourth quarter of 2018.
Aftermarket services segment revenue totaled $41.6 million compared to $56.8 million in the fourth quarter of 2018.
Revenue by Segment
Forward Guidance
Archrock is providing annual guidance for 2020 with net income between $67 million and $102 million and adjusted EBITDA between $415 million and $450 million.
Positive Outlook
- Contract operations revenue between $800 million and $825 million
- Contract operations gross margin percentage between 61.5% and 63.0%
- Aftermarket services revenue between $195 million and $210 million
- Aftermarket services gross margin percentage between 17.0% and 19.0%
- Cash available for dividend between $223 million and $248 million
Challenges Ahead
- Net income does not include the impact of long-lived asset impairment
- Selling, general and administrative expenses between $120 million and $125 million
- Growth capital expenditures between $80 million and $100 million
- Maintenance capital expenditures between $57 million and $63 million
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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