USA Compression Partners Achieves Record-Breaking Quarter: Unwavering Commitment to Safety and Operational Excellence
On February 11, 2025, USA Compression Partners hosted its Fourth Quarter 2024 Earnings Conference Call, providing a comprehensive update on the company's performance. The call was led by Clint Green, President and CEO, who commended the team for their unwavering commitment to safety, ensuring the well-being of employees, contractors, and customers.
During the conference call, USA Compression announced record-breaking results for the quarter and full year 2024, including record revenues, adjusted gross margin, adjusted EBITDA, distributable cash flow, distributable cash flow coverage, average revenue-generating horsepower, and average revenue per revenue-generating horsepower. These impressive figures enabled the company to improve distribution coverage and decrease leverage, which is approaching 4x.
Operational highlights were also presented during the call. Clint Green emphasized the importance of converting idle units to active status, resulting in a record-breaking 94.6% average horsepower utilization for the full year. This achievement reflects the company's dedication to maintaining and improving operational efficiency.
The conference call also touched on organizational changes, including the adoption of a shared service model with Energy Transfer involving various support functions. This initiative aims to optimize processes, improve digitalization, and reduce costs. The company expects to see significant savings over time, with full implementation anticipated in January 2026. A minimum of $5 million in annualized savings is expected as part of this transformation.
Looking ahead to 2025, USA Compression anticipates growth in new compression units, driven by the delivery of new compression ordered in prior years and the increase in utilization of existing units through idle-to-active conversions. The emphasis on internal utilization has forced a lean inventory of new horsepower going into 2025. However, this strategic approach is expected to provide a nice cash flow increase for 2026.
As it relates to 2026, USA Compression is already discussing its new order book and remains bullish on the crude oil and natural gas macro backdrop. The company believes that the new administration will continue to support the development of crude oil and natural gas for the foreseeable future.
