Kodiak Gas Services Announces Record Second Quarter 2024 Financial Results, Increases Full Year Adjusted EBITDA Guidance
Second Quarter 2024 and Recent Highlights
-
Total revenues were
$309.7 million compared to$203.3 million in the second quarter of 2023 -
Contract Services segment revenues and Adjusted Gross Margin Percentage(1) were
$276.3 million and 64.0%, respectively -
Net income was
$6.7 million compared to net income of$17.5 million in the second quarter of 2023 -
Record quarterly Adjusted EBITDA(1) of
$154.3 million compared to$107.9 million in the second quarter of 2023 -
Increased expected transaction run-rate cost synergies to greater than
$30 million - Deployed 41,500 horsepower of new large horsepower compression units
-
Horsepower utilization on units with >1,000 horsepower was ~98% at
June 30, 2024 -
Entered into an agreement to divest a significant number of small horsepower units both in the
U.S and internationally -
Declared a cash dividend of
$0.41 per share, or$1.64 per share annualized, representing an 8% increase over the first quarter 2024 dividend
Updated 2024 Guidance
-
Raised full-year 2024 Adjusted EBITDA guidance to a range of
$590 to$610 million , a$10 million increase to the low end of the range -
Expect to generate Discretionary Cash Flow(1) in the range of
$365 to$385 million in 2024
(1) |
Adjusted Gross Margin Percentage, Adjusted EBITDA, and Discretionary Cash Flow are Non-GAAP Financial Measures. Definitions and reconciliations to the most comparable GAAP financial measure is included herein. |
“We are pleased with our second quarter 2024 results as we completed the acquisition of
"Our leading position in the
Second Quarter 2024 Financial Results
Net income for the second quarter of 2024 was
Selling, general and administrative expenses were
Segment Information
Kodiak formerly managed its business through two operating segments: Compression Operations and Other Services. After the acquisition of
Contract Services segment revenues were
Other Services segment revenues were
Compression Fleet Update
Subsequent to
Long-Term Debt and Liquidity
Total debt outstanding was
Summary Financial Data (in thousands, except percentages) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Total revenues |
|
$ |
309,653 |
|
|
$ |
215,492 |
|
|
$ |
203,306 |
|
Net income |
|
$ |
6,713 |
|
|
$ |
30,232 |
|
|
$ |
17,517 |
|
Adjusted EBITDA (1) |
|
$ |
154,342 |
|
|
$ |
117,762 |
|
|
$ |
107,885 |
|
Adjusted EBITDA percentage (1) |
|
|
49.8 |
% |
|
|
54.6 |
% |
|
|
53.1 |
% |
|
|
|
|
|
|
|
||||||
Contract Services revenue |
|
$ |
276,250 |
|
|
$ |
193,399 |
|
|
$ |
181,619 |
|
Contract Services Adjusted Gross Margin (1) |
|
$ |
176,917 |
|
|
$ |
127,517 |
|
|
$ |
116,602 |
|
Contract Services Adjusted Gross Margin Percentage (1) |
|
|
64.0 |
% |
|
|
65.9 |
% |
|
|
64.2 |
% |
|
|
|
|
|
|
|
||||||
Other Services revenue |
|
$ |
33,403 |
|
|
$ |
22,093 |
|
|
$ |
21,687 |
|
Other Services Adjusted Gross Margin (1) |
|
$ |
5,467 |
|
|
$ |
4,409 |
|
|
$ |
3,588 |
|
Other Services Adjusted Gross Margin Percentage (1) |
|
|
16.4 |
% |
|
|
20.0 |
% |
|
|
16.5 |
% |
|
|
|
|
|
|
|
||||||
Maintenance capital expenditures |
|
$ |
19,147 |
|
|
$ |
10,642 |
|
|
$ |
10,940 |
|
Growth capital expenditures(2) |
|
$ |
90,390 |
|
|
$ |
59,401 |
|
|
$ |
32,529 |
|
|
|
|
|
|
|
|
||||||
Discretionary Cash Flow (1) |
|
$ |
90,617 |
|
|
$ |
71,925 |
|
|
$ |
64,873 |
|
Free Cash Flow (1) |
|
$ |
638 |
|
|
$ |
12,524 |
|
|
$ |
33,367 |
|
(1) |
Adjusted EBITDA, Adjusted EBITDA Percentage, Adjusted Gross Margin, Adjusted Gross Margin Percentage, Discretionary Cash Flow and Free Cash Flow are non-GAAP financial measures. For definitions and reconciliations to the most directly comparable financial measures calculated and presented in accordance with GAAP, see “Non-GAAP Financial Measures” below. |
|
(2) |
For the three months ended |
Summary Operating Data (as of the dates indicated) |
|||||||||
|
|
|
|
|
|
|
|||
Fleet horsepower (1) |
|
4,481,900 |
|
|
3,290,971 |
|
|
3,180,906 |
|
Revenue-generating horsepower (2) |
|
4,224,839 |
|
|
3,285,592 |
|
|
3,177,286 |
|
Fleet compression units |
|
7,317 |
|
|
3,091 |
|
|
3,038 |
|
Revenue-generating compression units |
|
5,753 |
|
|
3,064 |
|
|
3,023 |
|
Revenue-generating horsepower per revenue-generating compression unit (3) |
|
734 |
|
|
1,072 |
|
|
1,051 |
|
Horsepower utilization (4) |
|
94.3 |
% |
|
99.8 |
% |
|
99.9 |
% |
(1) |
Fleet horsepower includes owned horsepower excluding 27,663, 27,663 and 32,340 of non-marketable or obsolete horsepower as of |
|
(2) |
Revenue-generating horsepower includes fleet horsepower that is under contract, operating and generating revenue. |
|
(3) |
Calculated as (i) revenue-generating horsepower divided by (ii) revenue-generating compression units at period end. |
|
(4) |
Horsepower utilization is calculated as (i) revenue-generating horsepower divided by (ii) fleet horsepower. |
Full-Year 2024 Guidance
Kodiak is providing revised guidance for the full year 2024. The full-year 2024 guidance below incorporates three quarters of the financial impact of the
|
|
Full-Year 2024 Guidance |
||||||
|
|
Low |
|
High |
||||
Adjusted EBITDA (1) |
|
$ |
590,000 |
|
|
$ |
610,000 |
|
Discretionary Cash Flow (1)(2) |
|
$ |
365,000 |
|
|
$ |
385,000 |
|
|
|
|
|
|
||||
Segment Information |
|
|
|
|
||||
Contract Services revenues |
|
$ |
1,000,000 |
|
|
$ |
1,040,000 |
|
Contract Services Adjusted Gross Margin Percentage (1) |
|
|
64 |
% |
|
|
66 |
% |
Other Services revenues |
|
$ |
120,000 |
|
|
$ |
140,000 |
|
Other Services Adjusted Gross Margin Percentage (1) |
|
|
14 |
% |
|
|
17 |
% |
|
|
|
|
|
||||
Capital Expenditures |
|
|
|
|
||||
Growth capital expenditures (3) |
|
$ |
210,000 |
|
|
$ |
230,000 |
|
Maintenance capital expenditures |
|
$ |
60,000 |
|
|
$ |
70,000 |
|
(1) |
The Company is unable to reconcile projected Adjusted EBITDA to projected net income (loss) and Discretionary Cash Flow to projected net cash provided by operating activities, the most comparable financial measures calculated in accordance with GAAP, respectively, without unreasonable efforts because components of the calculations are inherently unpredictable, such as changes to current assets and liabilities, unknown future events, and estimating certain future GAAP measures. The inability to project certain components of the calculation would significantly affect the accuracy of the reconciliations. |
|
(2) |
Discretionary Cash Flow assumes no change to Secured Overnight Financing Rate futures. |
|
(3) |
Growth capital expenditures guidance excludes (i) approximately |
Conference Call
Kodiak will conduct a conference call on
About Kodiak
Kodiak is the largest contract compression services provider in
Non-GAAP Financial Measures
Adjusted EBITDA is defined as net income (loss) before interest expense, net; income tax expense (benefit); and depreciation and amortization; plus (i) loss (gain) on derivatives; (ii) equity compensation expense; (iii) severance expenses; (iv) transaction expenses; and (v) loss (gain) on sale of assets. Adjusted EBITDA Percentage is defined as Adjusted EBITDA divided by total revenues. Adjusted EBITDA and Adjusted EBITDA Percentage are used as supplemental financial measures by our management and external users of our financial statements, such as investors, commercial banks and other financial institutions, to assess: (i) the financial performance of our assets without regard to the impact of financing methods, capital structure or historical cost basis of our assets; (ii) the viability of capital expenditure projects and the overall rates of return on alternative investment opportunities; (iii) the ability of our assets to generate cash sufficient to make debt payments and pay dividends; and (iv) our operating performance as compared to those of other companies in our industry without regard to the impact of financing methods and capital structure. We believe Adjusted EBITDA and Adjusted EBITDA Percentage provide useful information to investors because, when viewed with our GAAP results and the accompanying reconciliation, they provide a more complete understanding of our performance than GAAP results alone. We also believe that external users of our financial statements benefit from having access to the same financial measures that management uses in evaluating the results of our business. Reconciliations of Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, and net cash provided by operating activities are presented below.
Adjusted Gross Margin is defined as revenue less cost of operations, exclusive of depreciation and amortization expense. Adjusted Gross Margin Percentage is defined as Adjusted Gross Margin divided by revenues. We believe Adjusted Gross Margin and Adjusted Gross Margin Percentage are useful as supplemental measures to investors of our operating profitability. Reconciliations of Adjusted Gross Margin to gross margin are presented below.
Discretionary Cash Flow is defined as net cash provided by operating activities less (i) maintenance capital expenditures;(ii) gain on sale of capital assets; (iii) certain changes in operating assets and liabilities; and (iv) certain other expenses; plus (x) cash loss on extinguishment of debt; and (y) transaction expenses. We believe Discretionary Cash Flow is a useful liquidity and performance measure and supplemental financial measure for us and our investors in assessing our ability to pay cash dividends to our stockholders, make growth capital expenditures and assess our operating performance. Reconciliations of Discretionary Cash Flow to net income and net cash provided by operating activities are presented below.
Free Cash Flow is defined as net cash provided by operating activities less (i) maintenance capital expenditures; (ii) gain on sale of capital assets; (iii) certain changes in operating assets and liabilities; (iv) certain other expenses; and (v) net growth capital expenditures; plus (x) transaction expenses; and (y) proceeds from sale of capital assets. We believe Free Cash Flow is a liquidity measure and useful supplemental financial measure for us and investors in assessing our ability to pursue business opportunities and investments to grow our business and to service our debt. Reconciliations of Free Cash Flow to net income and net cash provided by operating activities are presented below.
Cautionary Note Regarding Forward-Looking Statements
This news release contains, and our officers and representatives may from time to time make, “forward-looking statements” within the meaning of the safe harbor provisions of the
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) a reduction in the demand for natural gas and oil; (ii) the loss of, or the deterioration of the financial condition of, any of our key customers; (iii) nonpayment and nonperformance by our customers, suppliers or vendors; (iv) competitive pressures that may cause us to lose market share; (v) the structure of our Contract Services contracts and the failure of our customers to continue to contract for services after expiration of the primary term; (vi) our ability to successfully integrate any acquired business, including
Any forward-looking statement made by us in this news release is based only on information currently available to us and speaks only as of the date on which it is made. Except as may be required by applicable law, we undertake no obligation to publicly update any forward-looking statement whether as a result of new information, future developments or otherwise.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except share and per share data) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Revenues: |
|
|
|
|
|
|
||||||
Contract Services |
|
$ |
276,250 |
|
|
$ |
193,399 |
|
|
$ |
181,619 |
|
Other Services |
|
|
33,403 |
|
|
|
22,093 |
|
|
|
21,687 |
|
Total revenues |
|
|
309,653 |
|
|
|
215,492 |
|
|
|
203,306 |
|
Operating expenses: |
|
|
|
|
|
|
||||||
Cost of operations (exclusive of depreciation and amortization shown below) |
|
|
|
|
|
|
||||||
Contract Services |
|
|
99,333 |
|
|
|
65,882 |
|
|
|
65,017 |
|
Other Services |
|
|
27,936 |
|
|
|
17,684 |
|
|
|
18,099 |
|
Depreciation and amortization |
|
|
69,463 |
|
|
|
46,944 |
|
|
|
45,430 |
|
Selling, general and administrative expenses |
|
|
59,927 |
|
|
|
24,824 |
|
|
|
13,438 |
|
Gain on sale of property, plant and equipment |
|
|
(1,173 |
) |
|
|
— |
|
|
|
(738 |
) |
Total operating expenses |
|
|
255,486 |
|
|
|
155,334 |
|
|
|
141,246 |
|
Income from operations |
|
|
54,167 |
|
|
|
60,158 |
|
|
|
62,060 |
|
Other income (expenses): |
|
|
|
|
|
|
||||||
Interest expense, net |
|
|
(52,133 |
) |
|
|
(39,740 |
) |
|
|
(73,658 |
) |
Gain on derivatives |
|
|
6,797 |
|
|
|
19,757 |
|
|
|
34,934 |
|
Other income (expense), net |
|
|
218 |
|
|
|
(68 |
) |
|
|
32 |
|
Total other expenses, net |
|
|
(45,118 |
) |
|
|
(20,051 |
) |
|
|
(38,692 |
) |
Income before income taxes |
|
|
9,049 |
|
|
|
40,107 |
|
|
|
23,368 |
|
Income tax expense |
|
|
2,336 |
|
|
|
9,875 |
|
|
|
5,851 |
|
Net income |
|
|
6,713 |
|
|
|
30,232 |
|
|
|
17,517 |
|
Less: Net income attributable to noncontrolling interests |
|
|
485 |
|
|
|
— |
|
|
|
— |
|
Net Income attributable to common shareholders |
|
$ |
6,228 |
|
|
$ |
30,232 |
|
|
$ |
17,517 |
|
|
|
|
|
|
|
|
||||||
Earnings per share attributable to common shareholders: |
|
|
|
|
|
|
||||||
Basic net earnings per share |
|
$ |
0.07 |
|
|
$ |
0.39 |
|
|
$ |
0.30 |
|
Diluted net earnings per share |
|
$ |
0.06 |
|
|
$ |
0.39 |
|
|
$ |
0.30 |
|
Basic weighted average shares of common stock outstanding |
|
|
84,202,352 |
|
|
|
77,432,283 |
|
|
|
59,000,000 |
|
Diluted weighted average shares of common stock outstanding |
|
|
90,669,239 |
|
|
|
78,102,450 |
|
|
|
59,000,000 |
|
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share and per share data) |
||||||
|
|
As of |
|
As of 2023 |
||
Assets |
|
|
|
|
||
Current assets: |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
3,852 |
|
$ |
5,562 |
Accounts receivable, net |
|
|
203,426 |
|
|
113,192 |
Inventories, net |
|
|
119,649 |
|
|
76,238 |
Fair value of derivative instruments |
|
|
5,590 |
|
|
8,194 |
Contract assets |
|
|
5,424 |
|
|
17,424 |
Prepaid expenses and other current assets |
|
|
14,418 |
|
|
10,353 |
Total current assets |
|
|
352,359 |
|
|
230,963 |
Property, plant and equipment, net |
|
|
3,424,849 |
|
|
2,536,091 |
Operating lease right-of-use assets, net |
|
|
53,939 |
|
|
33,716 |
Finance lease right-of-use assets, net |
|
|
4,698 |
|
|
— |
|
|
|
403,390 |
|
|
305,553 |
Identifiable intangible assets, net |
|
|
165,213 |
|
|
122,888 |
Fair value of derivative instruments |
|
|
31,153 |
|
|
14,256 |
Deferred tax assets |
|
|
17 |
|
|
— |
Other assets |
|
|
3,662 |
|
|
639 |
Total assets |
|
$ |
4,439,280 |
|
$ |
3,244,106 |
Liabilities and Stockholders’ Equity |
|
|
|
|
||
Current liabilities: |
|
|
|
|
||
Accounts payable |
|
$ |
65,592 |
|
$ |
49,842 |
Accrued liabilities |
|
|
197,424 |
|
|
97,078 |
Contract liabilities |
|
|
71,418 |
|
|
63,709 |
Total current liabilities |
|
|
334,434 |
|
|
210,629 |
Long-term debt, net of unamortized debt issuance cost |
|
|
2,486,767 |
|
|
1,791,460 |
Operating lease liabilities |
|
|
49,392 |
|
|
34,468 |
Financing lease liabilities |
|
|
2,555 |
|
|
— |
Deferred tax liabilities |
|
|
97,861 |
|
|
62,748 |
Other liabilities |
|
|
4,889 |
|
|
2,148 |
Total liabilities |
|
2,975,898 |
|
2,101,453 |
||
Commitments and contingencies (Note 14) |
|
|
|
|
||
Stockholders’ equity: |
|
|
|
|
||
Preferred stock, par value |
|
|
56 |
|
|
— |
Common stock, par value |
|
|
842 |
|
|
774 |
Additional paid-in capital |
|
|
1,157,735 |
|
|
963,760 |
Noncontrolling interest |
|
|
152,529 |
|
|
— |
Retained earnings |
|
|
152,220 |
|
|
178,119 |
Total stockholders’ equity |
|
|
1,463,382 |
|
|
1,142,653 |
Total liabilities and stockholders’ equity |
|
$ |
4,439,280 |
|
$ |
3,244,106 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) |
|||||||
|
Six Months Ended |
||||||
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities: |
|
|
|
||||
Net Income |
$ |
36,945 |
|
|
$ |
5,174 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
116,407 |
|
|
|
90,327 |
|
Equity compensation expense |
|
8,159 |
|
|
|
908 |
|
Amortization of debt issuance costs |
|
4,946 |
|
|
|
11,071 |
|
Non-cash lease expense |
|
1,648 |
|
|
|
1,786 |
|
Provision for credit losses |
|
4,589 |
|
|
|
2 |
|
Inventory reserve |
|
476 |
|
|
|
250 |
|
Gain on sale of property, plant and equipment |
|
(1,173 |
) |
|
|
(721 |
) |
Change in fair value of derivatives |
|
(14,293 |
) |
|
|
21,529 |
|
Deferred tax provision |
|
7,104 |
|
|
|
761 |
|
Changes in operating assets and liabilities, exclusive of effects of business acquisition: |
|
|
|
||||
Accounts receivable |
|
(45,933 |
) |
|
|
(21,705 |
) |
Inventories |
|
(3,147 |
) |
|
|
(4,907 |
) |
Contract assets |
|
12,000 |
|
|
|
(958 |
) |
Prepaid expenses and other current assets |
|
4,671 |
|
|
|
(10,681 |
) |
Accounts payable |
|
21,983 |
|
|
|
10,954 |
|
Accrued and other liabilities |
|
11,871 |
|
|
|
(14,971 |
) |
Contract liabilities |
|
6,308 |
|
|
|
29,149 |
|
Other assets |
|
63 |
|
|
|
— |
|
Net cash provided by operating activities |
|
172,624 |
|
|
|
117,968 |
|
Cash flows from investing activities: |
|
|
|
||||
Net cash acquired in acquisition of |
|
9,458 |
|
|
|
— |
|
Purchase of property, plant and equipment |
|
(177,186 |
) |
|
|
(94,034 |
) |
Proceeds from sale of property, plant and equipment |
|
411 |
|
|
|
1,055 |
|
Other |
|
(35 |
) |
|
|
(14 |
) |
Net cash used in investing activities |
|
(167,352 |
) |
|
|
(92,993 |
) |
Cash flows from financing activities: |
|
|
|
||||
Borrowings on debt instruments |
|
1,945,775 |
|
|
|
499,279 |
|
Payments on debt instruments |
|
(1,867,851 |
) |
|
|
(428,812 |
) |
Principal payments on other borrowings |
|
(1,843 |
) |
|
|
— |
|
Payment of debt issuance cost |
|
(16,346 |
) |
|
|
(32,202 |
) |
Dividends paid to stockholders |
|
(62,393 |
) |
|
|
— |
|
Principal payments on finance leases |
|
(408 |
) |
|
|
— |
|
Offering costs |
|
(1,162 |
) |
|
|
— |
|
Cash paid for shares withheld to cover taxes |
|
(294 |
) |
|
|
— |
|
Distribution to stockholders |
|
— |
|
|
|
(42,300 |
) |
Distribution to noncontrolling interest |
|
(2,460 |
) |
|
|
— |
|
Net cash used in financing activities |
|
(6,982 |
) |
|
|
(4,035 |
) |
Net (decrease) increase in cash and cash equivalents |
|
(1,710 |
) |
|
|
20,940 |
|
Cash and cash equivalents - beginning of period |
|
5,562 |
|
|
|
20,431 |
|
Cash and cash equivalents - end of period |
$ |
3,852 |
|
|
$ |
41,371 |
|
Supplemental cash disclosures: |
|
|
|
||||
Cash paid for interest |
$ |
40,861 |
|
|
$ |
116,370 |
|
Cash paid for taxes |
$ |
9,225 |
|
|
$ |
5,726 |
|
Supplemental disclosure of non-cash investing activities: |
|
|
|
||||
Decrease in accrued capital expenditures |
$ |
2,702 |
|
|
$ |
9,946 |
|
Supplemental disclosure of non-cash financing activities: |
|
|
|
||||
Dividends equivalent |
$ |
(455 |
) |
|
$ |
— |
|
Issuance of common shares |
$ |
188,099 |
|
|
$ |
— |
|
Issuance of preferred shares and noncontrolling interest |
$ |
154,186 |
|
|
$ |
— |
|
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (in thousands, excluding percentages; unaudited) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Net income |
|
$ |
6,713 |
|
|
$ |
30,232 |
|
|
$ |
17,517 |
|
Interest expense, net |
|
|
52,133 |
|
|
|
39,740 |
|
|
|
73,658 |
|
Income tax expense |
|
|
2,336 |
|
|
|
9,875 |
|
|
|
5,851 |
|
Depreciation and amortization |
|
|
69,463 |
|
|
|
46,944 |
|
|
|
45,430 |
|
Gain on derivatives |
|
|
(6,797 |
) |
|
|
(19,757 |
) |
|
|
(34,934 |
) |
Equity compensation expense(1) |
|
|
5,311 |
|
|
|
2,848 |
|
|
|
29 |
|
Severance expense(2) |
|
|
8,969 |
|
|
|
— |
|
|
|
— |
|
Transaction expenses(3) |
|
|
17,387 |
|
|
|
7,880 |
|
|
|
1,072 |
|
Gain on sale of property, plant and equipment |
|
|
(1,173 |
) |
|
|
— |
|
|
|
(738 |
) |
Adjusted EBITDA |
|
$ |
154,342 |
|
|
$ |
117,762 |
|
|
$ |
107,885 |
|
Adjusted EBITDA Percentage |
|
|
49.8 |
% |
|
|
54.6 |
% |
|
|
53.1 |
% |
(1) |
For the three months ended |
|
(2) |
For the three months ended |
|
(3) |
Represents certain costs associated with non-recurring professional services, primarily related to the |
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED EBITDA (in thousands; unaudited) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Net cash provided by operating activities |
|
$ |
121,082 |
|
|
$ |
51,542 |
|
|
$ |
94,678 |
|
Interest expense, net |
|
|
52,133 |
|
|
|
39,740 |
|
|
|
73,658 |
|
Income tax (benefit) expense |
|
|
2,336 |
|
|
|
9,875 |
|
|
|
5,851 |
|
Deferred tax provision |
|
|
(843 |
) |
|
|
(6,261 |
) |
|
|
(3,282 |
) |
Cash received on derivatives |
|
|
(6,745 |
) |
|
|
(5,516 |
) |
|
|
(38,529 |
) |
Severance expense(1) |
|
|
8,969 |
|
|
|
— |
|
|
|
— |
|
Transaction expenses(2) |
|
|
17,387 |
|
|
|
7,880 |
|
|
|
1,072 |
|
Other(3) |
|
|
(7,605 |
) |
|
|
(4,054 |
) |
|
|
(6,763 |
) |
Change in operating assets and liabilities |
|
|
(32,372 |
) |
|
|
24,556 |
|
|
|
(18,800 |
) |
Adjusted EBITDA |
|
$ |
154,342 |
|
|
$ |
117,762 |
|
|
$ |
107,885 |
|
(1) |
For the three months ended |
|
(2) |
Represents certain costs associated with non-recurring professional services, primarily related to the |
|
(3) |
Includes amortization of debt issuance costs, non-cash lease expense, provision for credit losses and inventory reserve. |
RECONCILIATION OF ADJUSTED GROSS MARGIN TO GROSS MARGIN FOR CONTRACT SERVICES (in thousands, excluding percentages; unaudited) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Total revenues |
|
$ |
276,250 |
|
|
$ |
193,399 |
|
|
$ |
181,619 |
|
Cost of sales (excluding depreciation and amortization) |
|
|
(99,333 |
) |
|
|
(65,882 |
) |
|
|
(65,017 |
) |
Depreciation and amortization |
|
|
(69,463 |
) |
|
|
(46,944 |
) |
|
|
(45,430 |
) |
Gross margin |
|
$ |
107,454 |
|
|
$ |
80,573 |
|
|
$ |
71,172 |
|
Gross margin percentage |
|
|
38.9 |
% |
|
|
41.7 |
% |
|
|
39.2 |
% |
Depreciation and amortization |
|
|
69,463 |
|
|
|
46,944 |
|
|
|
45,430 |
|
Adjusted Gross Margin |
|
$ |
176,917 |
|
|
$ |
127,517 |
|
|
$ |
116,602 |
|
Adjusted Gross Margin Percentage(1) |
|
|
64.0 |
% |
|
|
65.9 |
% |
|
|
64.2 |
% |
(1) |
Calculated using Adjusted Gross Margin for Contract Services as a percentage of total Contract Services revenues. |
RECONCILIATION OF ADJUSTED GROSS MARGIN TO GROSS MARGIN FOR OTHER SERVICES (in thousands, excluding percentages; unaudited) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Total revenues |
|
$ |
33,403 |
|
|
$ |
22,093 |
|
|
$ |
21,687 |
|
Cost of sales (excluding depreciation and amortization) |
|
|
(27,936 |
) |
|
|
(17,684 |
) |
|
|
(18,099 |
) |
Depreciation and amortization |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Gross margin |
|
$ |
5,467 |
|
|
$ |
4,409 |
|
|
$ |
3,588 |
|
Gross margin percentage |
|
|
16.4 |
% |
|
|
20.0 |
% |
|
|
16.5 |
% |
Depreciation and amortization |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted Gross Margin |
|
$ |
5,467 |
|
|
$ |
4,409 |
|
|
$ |
3,588 |
|
Adjusted Gross Margin Percentage(1) |
|
|
16.4 |
% |
|
|
20.0 |
% |
|
|
16.5 |
% |
(1) |
Calculated using Adjusted Gross Margin for Other Services as a percentage of total Other Services revenues. |
RECONCILIATION OF NET INCOME TO DISCRETIONARY CASH FLOW AND FREE CASH FLOW (in thousands; unaudited) |
||||||||||||
|
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Net income |
|
$ |
6,713 |
|
|
$ |
30,232 |
|
|
$ |
17,517 |
|
Depreciation and amortization |
|
|
69,463 |
|
|
|
46,944 |
|
|
|
45,430 |
|
Change in fair value of derivatives |
|
|
(52 |
) |
|
|
(14,241 |
) |
|
|
3,595 |
|
Deferred tax provision |
|
|
843 |
|
|
|
6,261 |
|
|
|
3,282 |
|
Amortization of debt issuance costs |
|
|
2,303 |
|
|
|
2,643 |
|
|
|
5,626 |
|
Equity compensation expense(1) |
|
|
5,311 |
|
|
|
2,848 |
|
|
|
29 |
|
Severance expense(2) |
|
|
8,969 |
|
|
|
— |
|
|
|
— |
|
Transaction expenses(3) |
|
|
17,387 |
|
|
|
7,880 |
|
|
|
1,072 |
|
Gain on sale of property, plant and equipment |
|
|
(1,173 |
) |
|
|
— |
|
|
|
(738 |
) |
Maintenance capital expenditures |
|
|
(19,147 |
) |
|
|
(10,642 |
) |
|
|
(10,940 |
) |
Discretionary Cash Flow |
|
$ |
90,617 |
|
|
$ |
71,925 |
|
|
$ |
64,873 |
|
Growth capital expenditures(4)(5)(6) |
|
|
(90,390 |
) |
|
|
(59,401 |
) |
|
|
(32,529 |
) |
Proceeds from sale of property, plant and equipment |
|
|
411 |
|
|
|
— |
|
|
|
1,023 |
|
Free Cash Flow |
|
$ |
638 |
|
|
$ |
12,524 |
|
|
$ |
33,367 |
|
(1) |
For the three months ended |
|
(2) |
For the three months ended |
|
(3) |
Represents certain costs associated with non-recurring professional services, primarily related to the |
|
(4) |
For the three months ended |
|
(5) |
For the three months ended |
|
(6) |
For the three months ended |
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO DISCRETIONARY CASH FLOW AND FREE CASH FLOW (in thousands; unaudited) |
||||||||||||
|
|
Three Months Ended |
||||||||||
|
|
|
|
|
|
|
||||||
Net cash provided by operating activities |
|
$ |
121,082 |
|
|
$ |
51,542 |
|
|
$ |
94,678 |
|
Maintenance capital expenditures |
|
|
(19,147 |
) |
|
|
(10,642 |
) |
|
|
(10,940 |
) |
Severance expense(1) |
|
|
8,969 |
|
|
|
— |
|
|
|
— |
|
Transaction expenses(2) |
|
|
17,387 |
|
|
|
7,880 |
|
|
|
1,072 |
|
Gain on sale of property, plant and equipment |
|
|
(1,173 |
) |
|
|
— |
|
|
|
(738 |
) |
Change in operating assets and liabilities |
|
|
(32,372 |
) |
|
|
24,556 |
|
|
|
(18,800 |
) |
Other(3) |
|
|
(4,129 |
) |
|
|
(1,411 |
) |
|
|
(399 |
) |
Discretionary Cash Flow |
|
$ |
90,617 |
|
|
$ |
71,925 |
|
|
$ |
64,873 |
|
Growth capital expenditures(4)(5)(6) |
|
|
(90,390 |
) |
|
|
(59,401 |
) |
|
|
(32,529 |
) |
Proceeds from sale of property, plant and equipment |
|
|
411 |
|
|
|
— |
|
|
|
1,023 |
|
Free Cash Flow |
|
$ |
638 |
|
|
$ |
12,524 |
|
|
$ |
33,367 |
|
(1) |
For the three months ended |
|
(2) |
Represents certain costs associated with non-recurring professional services, primarily related to the |
|
(3) |
Includes non-cash lease expense, provision for credit losses and inventory reserve. |
|
(4) |
For the three months ended |
|
(5) |
For the three months ended |
|
(6) |
For the three months ended |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240812158226/en/
Investor Contact
ir@kodiakgas.com
(936) 755-3529
Source: