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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.
Archrock
Archrock
Archrock Revenue by Segment
Revenue by Segment
Contract Operations Revenue
CapyFin.comAftermarket Services Revenue
CapyFin.com 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
- Other capital expenditures between $28 million and $32 million
Revenue & Expenses
Visualization of income flow from segment revenue to net income