Attached files
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8-K - FORM 8-K - Archrock, Inc. | form8_k.htm |
Exhibit 99.1
Exterran Holdings and Exterran Partners Report
Fourth Quarter and Full Year 2010 Results
HOUSTON, February 24, 2011 – Exterran Holdings, Inc. (NYSE: EXH) and Exterran Partners, L.P. (NASDAQ: EXLP) today reported financial results for the fourth quarter and full year 2010.
Exterran Holdings, Inc. Financial Results
Exterran Holdings reported a net loss attributable to Exterran stockholders for the fourth quarter 2010 of $118.0 million, or $1.90 per diluted share, compared to net loss attributable to Exterran stockholders for the third quarter 2010 of $18.0 million, or $0.29 per diluted share, and net income attributable to Exterran stockholders for the fourth quarter 2009 of $22.6 million, or $0.37 per diluted share.
Net loss from continuing operations attributable to Exterran stockholders for the fourth quarter 2010 was $32.0 million, or $0.51 per diluted share, excluding non-cash pretax charges that totaled $142.5 million, including a $142.2 million impairment charge related primarily to idle compressor units that were previously part of our North America contract operations business. The impairment charge did not impact our cash flows, liquidity position, or compliance with debt covenants. Net loss from continuing operations attributable to Exterran stockholders, excluding charges, was $15.2 million, or $0.25 per diluted share, for the third quarter 2010 and $16.9 million, or $0.27 per diluted share, for the fourth quarter 2009.
Revenue was $615.8 million for the fourth quarter 2010, compared to $625.6 million for the third quarter 2010 and $654.7 million for the fourth quarter 2009. EBITDA, as adjusted (as defined below), was $103.8 million for the fourth quarter 2010, compared to $109.7 million for the third quarter 2010 and $139.6 million for the fourth quarter 2009.
Ernie L. Danner, Exterran Holdings’ President and Chief Executive Officer, said, “Fourth quarter highlights included a modest improvement in the operating performance of our North America contract operations business and the generation of significant cash flow and further reduction of our debt balances. We are cautiously optimistic about a continuing gradual improvement in the demand for our oil and gas production-related products and services in 2011 in North America, where relatively low natural gas prices have resulted in a shift in our growth activities to areas with a natural gas liquids component. Internationally, overall inquiry levels are solid although we have not yet seen a return to the higher level of bookings for contract operations and fabrication projects that we have experienced historically and expect in the future. Overall for 2011, our goal is to achieve an increase of 5% or more over 2010 levels in both revenue and EBITDA, as adjusted, as we pursue growth opportunities primarily associated with North America shale plays and international energy infrastructure development.
1
We own a majority interest of Exterran Partners including the general partner interest, and over time we intend to offer the remainder of Exterran Holdings’ U.S. contract operations business to Exterran Partners. In 2011, we expect to use the proceeds from these transactions and operating cash flow to fund investments in growth projects and fleet assets and expect that cash flow in excess of our needs will allow us to reduce Exterran Holdings’ debt balances (exclusive of Exterran Partners’ debt) by $250 million to $300 million during the year.”
Exterran Partners, L.P. Financial Results
Exterran Partners reported revenue of $68.4 million for the fourth quarter 2010, compared to $62.7 million for the third quarter 2010 and $47.1 million for the fourth quarter 2009. Net loss was $23.5 million for the fourth quarter 2010, or $0.73 per diluted limited partner unit, compared to net income of $0.1 million, or a loss of $0.01 per diluted limited partner unit, for the third quarter 2010, and net income of $3.3 million, or $0.13 per diluted limited partner unit, for the fourth quarter 2009.
Net income for the fourth quarter 2010 was $1.2 million, or $0.02 per diluted limited partner unit, excluding a $24.7 million non-cash fleet impairment charge. The impairment charge did not impact Exterran Partners’ cash flows, liquidity position, or compliance with debt covenants.
Exterran Partners’ EBITDA, as further adjusted (as defined below), totaled $31.4 million for the fourth quarter 2010, compared to $28.0 million for the third quarter 2010 and $21.6 million for the fourth quarter 2009. Distributable cash flow (as defined below) totaled $20.4 million for the fourth quarter 2010, compared to $19.3 million for the third quarter 2010 and $13.2 million for the fourth quarter 2009.
“Fourth quarter performance benefitted from increased operating horsepower during the quarter as a result of increased demand for contract operations services and a full quarter contribution from the August 2010 acquisition of assets representing an additional 255,000 horsepower of compression capacity from Exterran Holdings,” commented Mr. Danner, Chairman, President and Chief Executive Officer of Exterran Partners’ managing general partner. “We are committed to our growth strategies and continuing to increase distributions to unitholders over time.”
For the fourth quarter of 2010, Exterran Partners’ quarterly cash distribution was $0.4725 per limited partner unit, or $1.89 per limited partner unit on an annualized basis. The fourth quarter 2010 distribution was $0.005 higher than the third quarter 2010 distribution of $0.4675 per limited partner unit and $0.01 higher than the fourth quarter 2009 distribution of $0.4625 per limited partner unit.
2
The cash distribution received by Exterran Holdings based upon its common unit ownership and general partner interest in Exterran Partners was approximately $9.5 million for the fourth quarter 2010.
Conference Call Details
Exterran Holdings, Inc. (NYSE: EXH) and Exterran Partners, L.P. (NASDAQ: EXLP) announce the following schedule and teleconference information for their fourth quarter 2010 earnings release:
·
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Teleconference: Thursday, February 24, 2011 at 11:00 a.m. Eastern Time, 10:00 a.m. Central Time. To access the call, United States and Canadian participants should dial 800-446-1671. International participants should dial 847-413-3362 at least 10 minutes before the scheduled start time. Please reference Exterran conference call number 29103326.
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·
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Live Webcast: The webcast will be available in listen-only mode via the companies’ website: www.exterran.com.
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·
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Webcast Replay: For those unable to participate, a replay will be available from 2:00 p.m. Eastern Time on Thursday, February 24, 2011, until 2:00 p.m. Eastern Time on Thursday, March 3, 2011. To listen to the replay, please dial 888-843-7419 in the United States and Canada, or 630-652-3042 internationally, and enter access code 29103326.
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*****
With respect to Exterran Holdings, EBITDA, as adjusted, a non-GAAP measure, is defined as net income (loss) plus income (loss) from discontinued operations (net of tax), cumulative effect of accounting changes (net of tax), income taxes, interest expense (including debt extinguishment costs and gain or loss on termination of interest rate swaps), depreciation and amortization expense, impairment charges, merger and integration expenses, restructuring charges and other charges.
With respect to Exterran Partners, EBITDA, as further adjusted, a non-GAAP measure, is defined as net income (loss) plus 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, and 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.
With respect to Exterran Partners, 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 early terminate interest rate swaps) and maintenance capital expenditures, and excluding gains/losses on asset sales and other charges.
3
With respect to Exterran Holdings, Gross Margin, a non-GAAP measure, is defined as total revenue less cost of sales (excluding depreciation and amortization expense).
With respect to Exterran Partners, Gross Margin, as adjusted, a non-GAAP measure, is defined as total revenue less cost of sales (excluding depreciation and amortization expense) plus any amounts by which cost of sales 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.
About Exterran Holdings and Exterran Partners
Exterran Holdings, Inc. is a global market leader in full service natural gas compression and a premier provider of operations, maintenance, service and equipment for oil and gas production, processing and transportation applications. Exterran Holdings serves customers across the energy spectrum—from producers to transporters to processors to storage owners. Headquartered in Houston, Texas, Exterran has over 10,000 employees and operates in approximately 30 countries.
Exterran Partners, L.P. provides natural gas contract operations services to customers throughout the United States. Exterran Holdings indirectly owns a majority interest in Exterran Partners.
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 the control of Exterran Holdings and Exterran Partners (the “Companies”), which could cause actual results to differ materially from such statements. Forward-looking information includes, but is not limited to: the Companies’ operational and financial strategies and ability to successfully effect those strategies; the Companies’ expected future capital expenditures; the Companies’ expectations regarding future economic and market conditions; the Companies’ financial and operational outlook, including projections regarding revenue, EBITDA, as adjusted, debt reduction and cash flow, and ability to fulfill that outlook; Exterran Holdings’ intention to continue to offer the balance of its U.S. contract operations business to Exterran Partners; and Exterran Partners’ commitment to growing and increasing distributions.
4
While the Companies believe that the assumptions concerning future events are reasonable, they caution that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of their business. Among the factors that could cause results to differ materially from those indicated by such forward-looking statements are: local, regional, national and international economic conditions and the impact they may have on the Companies and their 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 and natural gas and the impact on the price of oil and natural gas; Exterran Holdings’ ability to timely and cost-effectively execute larger projects; changes in political or economic conditions in key operating markets, including international markets; changes in safety, health, environmental and other regulations; and, as to each of the Companies, the performance of the other entity.
These forward-looking statements are also affected by the risk factors, forward-looking statements and challenges and uncertainties described in Exterran Holdings’ Annual Report on Form 10-K for the year ended December 31, 2009, Exterran Partners’ Annual Report on Form 10-K for the year ended December 31, 2009, and those set forth from time to time in the Companies’ filings with the Securities and Exchange Commission, which are currently available at www.exterran.com. Except as required by law, the Companies expressly disclaim any intention or obligation to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.
Exterran Contact Information:
Investors: David Oatman (281) 836-7035
Media: Susan Nelson (281) 836-7297
SOURCE: Exterran Holdings, Inc. and Exterran Partners, L.P.
5
EXTERRAN HOLDINGS, INC.
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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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(In thousands, except per share amounts)
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Three Months Ended |
Years Ended
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December 31,
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September 30,
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December 31,
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December 31,
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December 31,
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2010
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2010
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2009
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2010
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2009
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Revenues:
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||||||||||||||||||||
North America contract operations
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$ | 151,383 | $ | 152,007 | $ | 154,900 | $ | 608,065 | $ | 695,315 | ||||||||||
International contract operations
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112,438 | 111,879 | 109,448 | 465,144 | 391,995 | |||||||||||||||
Aftermarket services
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86,063 | 82,348 | 79,312 | 322,097 | 308,873 | |||||||||||||||
Fabrication
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265,896 | 279,389 | 311,055 | 1,066,227 | 1,319,418 | |||||||||||||||
615,780 | 625,623 | 654,715 | 2,461,533 | 2,715,601 | ||||||||||||||||
Costs and Expenses:
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Cost of sales (excluding depreciation and amortization expense):
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North America contract operations
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76,219 | 78,281 | 66,033 | 300,686 | 298,714 | |||||||||||||||
International contract operations
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44,693 | 46,936 | 40,701 | 175,357 | 149,253 | |||||||||||||||
Aftermarket services
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75,688 | 73,717 | 64,994 | 276,307 | 245,886 | |||||||||||||||
Fabrication
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229,735 | 231,716 | 265,855 | 904,722 | 1,106,166 | |||||||||||||||
Selling, general and administrative
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91,809 | 88,229 | 84,529 | 358,255 | 337,620 | |||||||||||||||
Depreciation and amortization
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105,012 | 98,503 | 97,028 | 401,478 | 352,785 | |||||||||||||||
Long-lived asset impairment
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142,205 | 2,246 | 4,704 | 146,903 | 96,988 | |||||||||||||||
Restructuring charges
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- | - | 1,933 | - | 14,329 | |||||||||||||||
Goodwill impairment
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- | - | - | - | 150,778 | |||||||||||||||
Interest expense
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37,557 | 33,050 | 33,577 | 136,149 | 122,845 | |||||||||||||||
Equity in (income) loss of non-consolidated affiliates
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261 | - | (1,541 | ) | 609 | 91,154 | ||||||||||||||
Other (income) expense, net
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(6,154 | ) | (2,941 | ) | (27,797 | ) | (13,763 | ) | (53,360 | ) | ||||||||||
797,025 | 649,737 | 630,016 | 2,686,703 | 2,913,158 | ||||||||||||||||
Income (loss) before income taxes
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(181,245 | ) | (24,114 | ) | 24,699 | (225,170 | ) | (197,557 | ) | |||||||||||
Provision for (benefit from) income taxes
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(55,708 | ) | (7,083 | ) | 50,190 | (66,606 | ) | 51,667 | ||||||||||||
Loss from continuing operations
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(125,537 | ) | (17,031 | ) | (25,491 | ) | (158,564 | ) | (249,224 | ) | ||||||||||
Income (loss) from discontinued operations, net of tax
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(2,734 | ) | (1,325 | ) | 49,112 | 45,323 | (296,239 | ) | ||||||||||||
Net income (loss)
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(128,271 | ) | (18,356 | ) | 23,621 | (113,241 | ) | (545,463 | ) | |||||||||||
Less: net (income) loss attributable to the noncontrolling interest
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10,243 | 371 | (1,036 | ) | 11,416 | (3,944 | ) | |||||||||||||
Net income (loss) attributable to Exterran stockholders
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$ | (118,028 | ) | $ | (17,985 | ) | $ | 22,585 | $ | (101,825 | ) | $ | (549,407 | ) | ||||||
Basic income (loss) per common share
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Loss from continuing operations attributable to Exterran stockholders
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$ | (1.85 | ) | $ | (0.27 | ) | $ | (0.43 | ) | $ | (2.37 | ) | $ | (4.12 | ) | |||||
Income (loss) from discontinued operations attributable to Exterran stockholders
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(0.05 | ) | (0.02 | ) | 0.80 | 0.73 | (4.83 | ) | ||||||||||||
Net income (loss) attributable to Exterran stockholders
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$ | (1.90 | ) | $ | (0.29 | ) | $ | 0.37 | $ | (1.64 | ) | $ | (8.95 | ) | ||||||
Diluted income (loss) per common share
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Loss from continuing operations attributable to Exterran stockholders
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$ | (1.85 | ) | $ | (0.27 | ) | $ | (0.43 | ) | $ | (2.37 | ) | $ | (4.12 | ) | |||||
Income (loss) from discontinued operations attributable to Exterran stockholders
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(0.05 | ) | (0.02 | ) | 0.80 | 0.73 | (4.83 | ) | ||||||||||||
Net income (loss) attributable to Exterran stockholders
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$ | (1.90 | ) | $ | (0.29 | ) | $ | 0.37 | $ | (1.64 | ) | $ | (8.95 | ) | ||||||
Weighted average common and equivalent shares outstanding:
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Basic
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62,164 | 62,111 | 61,651 | 61,995 | 61,406 | |||||||||||||||
Diluted
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62,164 | 62,111 | 61,651 | 61,995 | 61,406 | |||||||||||||||
Income (loss) attributable to Exterran stockholders:
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Loss from continuing operations
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$ | (115,294 | ) | $ | (16,660 | ) | $ | (26,527 | ) | $ | (147,148 | ) | $ | (253,168 | ) | |||||
Income (loss) from discontinued operations, net of tax
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(2,734 | ) | (1,325 | ) | 49,112 | 45,323 | (296,239 | ) | ||||||||||||
Net income (loss) attributable to Exterran stockholders
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$ | (118,028 | ) | $ | (17,985 | ) | $ | 22,585 | $ | (101,825 | ) | $ | (549,407 | ) |
6
EXTERRAN HOLDINGS, INC.
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UNAUDITED SUPPLEMENTAL INFORMATION
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(In thousands, except percentages)
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Three Months Ended |
Years Ended
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December 31,
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September 30,
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December 31,
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December 31,
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December 31,
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2010
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2010
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2009
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2010
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2009
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Revenues:
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North America contract operations
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$ | 151,383 | $ | 152,007 | $ | 154,900 | $ | 608,065 | $ | 695,315 | ||||||||||
International contract operations
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112,438 | 111,879 | 109,448 | 465,144 | 391,995 | |||||||||||||||
Aftermarket services
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86,063 | 82,348 | 79,312 | 322,097 | 308,873 | |||||||||||||||
Fabrication
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265,896 | 279,389 | 311,055 | 1,066,227 | 1,319,418 | |||||||||||||||
Total
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$ | 615,780 | $ | 625,623 | $ | 654,715 | $ | 2,461,533 | $ | 2,715,601 | ||||||||||
Gross Margin (1):
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North America contract operations
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$ | 75,164 | $ | 73,726 | $ | 88,867 | $ | 307,379 | $ | 396,601 | ||||||||||
International contract operations
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67,745 | 64,943 | 68,747 | 289,787 | 242,742 | |||||||||||||||
Aftermarket services
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10,375 | 8,631 | 14,318 | 45,790 | 62,987 | |||||||||||||||
Fabrication
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36,161 | 47,673 | 45,200 | 161,505 | 213,252 | |||||||||||||||
Total
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$ | 189,445 | $ | 194,973 | $ | 217,132 | $ | 804,461 | $ | 915,582 | ||||||||||
Selling, General and Administrative
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$ | 91,809 | $ | 88,229 | $ | 84,529 | $ | 358,255 | $ | 337,620 | ||||||||||
% of Revenues
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15 | % | 14 | % | 13 | % | 15 | % | 12 | % | ||||||||||
EBITDA, as adjusted (1)
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$ | 103,790 | $ | 109,685 | $ | 139,594 | $ | 455,106 | $ | 615,955 | ||||||||||
% of Revenues
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17 | % | 18 | % | 21 | % | 18 | % | 23 | % | ||||||||||
Capital Expenditures
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$ | 67,528 | $ | 59,063 | $ | 65,341 | $ | 235,990 | $ | 368,901 | ||||||||||
Less: Proceeds from Sale of PP&E
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(5,695 | ) | (7,096 | ) | (51,587 | ) | (31,195 | ) | (69,097 | ) | ||||||||||
Net Capital Expenditures
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$ | 61,833 | $ | 51,967 | $ | 13,754 | $ | 204,795 | $ | 299,804 | ||||||||||
Gross Margin Percentage:
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North America contract operations
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50 | % | 49 | % | 57 | % | 51 | % | 57 | % | ||||||||||
International contract operations
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60 | % | 58 | % | 63 | % | 62 | % | 62 | % | ||||||||||
Aftermarket services
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12 | % | 10 | % | 18 | % | 14 | % | 20 | % | ||||||||||
Fabrication
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14 | % | 17 | % | 15 | % | 15 | % | 16 | % | ||||||||||
Total
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31 | % | 31 | % | 33 | % | 33 | % | 34 | % | ||||||||||
Total Available Horsepower (at period end):
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North America contract operations
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3,701 | 4,272 | 4,321 | 3,701 | 4,321 | |||||||||||||||
International contract operations
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1,200 | 1,281 | 1,234 | 1,200 | 1,234 | |||||||||||||||
Total
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4,901 | 5,553 | 5,555 | 4,901 | 5,555 | |||||||||||||||
Total Operating Horsepower (at period end):
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North America contract operations
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2,837 | 2,827 | 2,867 | 2,837 | 2,867 | |||||||||||||||
International contract operations
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981 | 1,020 | 1,032 | 981 | 1,032 | |||||||||||||||
Total
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3,818 | 3,847 | 3,899 | 3,818 | 3,899 | |||||||||||||||
Total Operating Horsepower (average):
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North America contract operations
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2,826 | 2,822 | 2,920 | 2,832 | 3,143 | |||||||||||||||
International contract operations
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1,007 | 1,032 | 1,022 | 1,024 | 1,033 | |||||||||||||||
Total
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3,833 | 3,854 | 3,942 | 3,856 | 4,176 | |||||||||||||||
Horsepower Utilization (at period end):
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North America contract operations
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77 | % | 66 | % | 66 | % | 77 | % | 66 | % | ||||||||||
International contract operations
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82 | % | 80 | % | 84 | % | 82 | % | 84 | % | ||||||||||
Total
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78 | % | 69 | % | 70 | % | 78 | % | 70 | % | ||||||||||
Fabrication Backlog:
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Compression & accessory fabrication
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$ | 220,254 | $ | 229,483 | $ | 296,850 | $ | 220,254 | $ | 296,850 | ||||||||||
Production & processing equipment fabrication
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483,275 | 461,433 | 515,607 | 483,275 | 515,607 | |||||||||||||||
Total
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$ | 703,529 | $ | 690,916 | $ | 812,457 | $ | 703,529 | $ | 812,457 | ||||||||||
Debt to Capitalization:
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Debt
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$ | 1,897,147 | $ | 1,971,309 | $ | 2,260,936 | $ | 1,897,147 | $ | 2,260,936 | ||||||||||
Exterran stockholders' Equity
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1,609,448 | 1,713,583 | 1,639,997 | 1,609,448 | 1,639,997 | |||||||||||||||
Capitalization
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$ | 3,506,595 | $ | 3,684,892 | $ | 3,900,933 | $ | 3,506,595 | $ | 3,900,933 | ||||||||||
Total
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54.1 | % | 53.5 | % | 58.0 | % | 54.1 | % | 58.0 | % | ||||||||||
(1) Management believes disclosure of EBITDA, as adjusted, and Gross Margin, both non-GAAP measures, provides useful information to investors because, when viewed with our GAAP results and accompanying reconciliations, they provide a more complete understanding of our performance than GAAP results alone. Management uses EBITDA, as adjusted, and Gross Margin as supplemental measures to review current period operating performance, comparability measures and performance measures for period to period comparisons. In addition, EBITDA, as adjusted, is used by management as a valuation measure.
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7
EXTERRAN HOLDINGS, INC.
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UNAUDITED SUPPLEMENTAL INFORMATION
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(In thousands, except per share amounts)
|
||||||||||||||||||||
Three Months Ended |
Years Ended
|
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December 31,
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September 30,
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December 31,
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December 31,
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December 31,
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2010
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2010
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2009
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2010
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2009
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Reconciliation of GAAP to Non-GAAP Financial Information:
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Net income (loss)
|
$ | (128,271 | ) | $ | (18,356 | ) | $ | 23,621 | $ | (113,241 | ) | $ | (545,463 | ) | ||||||
Income (loss) from discontinued operations, net of tax
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(2,734 | ) | (1,325 | ) | 49,112 | 45,323 | (296,239 | ) | ||||||||||||
Loss from continuing operations
|
(125,537 | ) | (17,031 | ) | (25,491 | ) | (158,564 | ) | (249,224 | ) | ||||||||||
Depreciation and amortization
|
105,012 | 98,503 | 97,028 | 401,478 | 352,785 | |||||||||||||||
Long-lived asset impairment
|
142,205 | 2,246 | 4,704 | 146,903 | 96,988 | |||||||||||||||
Restructuring charges
|
- | - | 1,933 | - | 14,329 | |||||||||||||||
Investment in non-consolidated affiliates (income) impairment
|
261 | - | (1,541 | ) | 609 | 96,593 | ||||||||||||||
Goodwill impairment
|
- | - | - | - | 150,778 | |||||||||||||||
Interest expense
|
37,557 | 33,050 | 33,577 | 136,149 | 122,845 | |||||||||||||||
Gain on sale of our investment in the subsidiary that owns the barge mounted processing
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plant and other related assets used on the Cawthorne Channel Project
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- | - | (20,806 | ) | (4,863 | ) | (20,806 | ) | ||||||||||||
Provision for (benefit from) income taxes
|
(55,708 | ) | (7,083 | ) | 50,190 | (66,606 | ) | 51,667 | ||||||||||||
EBITDA, as adjusted (1)
|
103,790 | 109,685 | 139,594 | 455,106 | 615,955 | |||||||||||||||
Selling, general and administrative
|
91,809 | 88,229 | 84,529 | 358,255 | 337,620 | |||||||||||||||
Equity in (income) loss of non-consolidated affiliates
|
261 | - | (1,541 | ) | 609 | 91,154 | ||||||||||||||
Investment in non-consolidated affiliates income (impairment)
|
(261 | ) | - | 1,541 | (609 | ) | (96,593 | ) | ||||||||||||
Gain on sale of our investment in the subsidiary that owns the barge mounted processing
|
||||||||||||||||||||
plant and other related assets used on the Cawthorne Channel Project
|
- | - | 20,806 | 4,863 | 20,806 | |||||||||||||||
Other (income) expense, net
|
(6,154 | ) | (2,941 | ) | (27,797 | ) | (13,763 | ) | (53,360 | ) | ||||||||||
Gross Margin (1)
|
$ | 189,445 | $ | 194,973 | $ | 217,132 | $ | 804,461 | $ | 915,582 | ||||||||||
Net income (loss) attributable to Exterran stockholders
|
$ | (118,028 | ) | $ | (17,985 | ) | $ | 22,585 | $ | (101,825 | ) | $ | (549,407 | ) | ||||||
(Income) loss from discontinued operations
|
2,734 | 1,325 | (49,112 | ) | (45,323 | ) | 296,239 | |||||||||||||
Charges, after-tax:
|
||||||||||||||||||||
Long-lived asset impairment (including the impact on minority interest)
|
83,080 | 1,415 | 2,975 | 85,940 | 57,586 | |||||||||||||||
Restructuring charges
|
- | - | 1,276 | - | 13,153 | |||||||||||||||
Investment in non-consolidated affiliates (income) impairment
|
261 | - | (1,541 | ) | 609 | 88,193 | ||||||||||||||
Goodwill impairment
|
- | - | - | - | 150,778 | |||||||||||||||
Gain on sale of our investment in the subsidiary that owns the barge mounted processing
|
||||||||||||||||||||
plant and other related assets used on the Cawthorne Channel Project
|
- | - | (12,067 | ) | (8,807 | ) | (12,067 | ) | ||||||||||||
Tax provision related to legal entity restructuring and foreign tax assessment for prior period
|
- | - | 18,959 | - | 18,959 | |||||||||||||||
Net income (loss) from continuing operations attributable to Exterran stockholders, excluding charges
|
$ | (31,953 | ) | $ | (15,245 | ) | $ | (16,925 | ) | $ | (69,406 | ) | $ | 63,434 | ||||||
Diluted loss from continuing operations attributable to Exterran stockholders
|
$ | (1.85 | ) | $ | (0.27 | ) | $ | (0.43 | ) | $ | (2.37 | ) | $ | (4.12 | ) | |||||
Adjustment for charges, after-tax, per common share
|
1.34 | 0.02 | 0.16 | 1.25 | 5.14 | |||||||||||||||
Diluted net income (loss) from continuing operations attributable to Exterran
|
||||||||||||||||||||
stockholders per common share, excluding charges (1)
|
$ | (0.51 | ) | $ | (0.25 | ) | $ | (0.27 | ) | $ | (1.12 | ) | $ | 1.02 | ||||||
(1) Management believes disclosure of EBITDA, as adjusted, diluted net income (loss) from continuing operations attributable to Exterran stockholders per common share, excluding charges, and Gross Margin, non-GAAP measures, provides useful information to investors because, when viewed with our GAAP results and accompanying reconciliations, they provide a more complete understanding of our performance than GAAP results alone. Management uses EBITDA, as adjusted, diluted net income (loss) from continuing operations attributable to Exterran stockholders per common share, excluding charges, and Gross Margin as supplemental measures to review current period operating performance, comparability measures and performance measures for period to period comparisons. In addition, EBITDA, as adjusted, is used by management as a valuation measure.
|
8
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,
|
||||||||||||||||
2010
|
2010
|
2009
|
2010
|
2009
|
||||||||||||||||
Revenue
|
$ | 68,415 | $ | 62,721 | $ | 47,102 | $ | 237,636 | $ | 181,729 | ||||||||||
Costs and expenses:
|
||||||||||||||||||||
Cost of sales (excluding depreciation and amortization)
|
35,446 | 33,819 | 21,320 | 124,242 | 83,480 | |||||||||||||||
Depreciation and amortization
|
15,180 | 13,697 | 10,398 | 52,518 | 36,452 | |||||||||||||||
Long-lived asset impairment
|
24,652 | 93 | 156 | 24,976 | 3,151 | |||||||||||||||
Selling, general and administrative
|
10,112 | 8,504 | 7,713 | 34,830 | 24,226 | |||||||||||||||
Interest expense
|
6,601 | 6,020 | 5,640 | 24,037 | 20,303 | |||||||||||||||
Other (income) expense, net
|
(241 | ) | 333 | (1,559 | ) | (314 | ) | (1,208 | ) | |||||||||||
Total costs and expenses
|
91,750 | 62,466 | 43,668 | 260,289 | 166,404 | |||||||||||||||
Income (loss) before income taxes
|
(23,335 | ) | 255 | 3,434 | (22,653 | ) | 15,325 | |||||||||||||
Income tax expense
|
162 | 172 | 117 | 680 | 541 | |||||||||||||||
Net income (loss)
|
$ | (23,497 | ) | $ | 83 | $ | 3,317 | $ | (23,333 | ) | $ | 14,784 | ||||||||
General partner interest in net income (loss)
|
$ | 49 | $ | 420 | $ | 377 | $ | 1,091 | $ | 1,354 | ||||||||||
Limited partner interest in net income (loss)
|
$ | (23,546 | ) | $ | (337 | ) | $ | 2,940 | $ | (24,424 | ) | $ | 13,430 | |||||||
Weighted average limited partners' units outstanding:
|
||||||||||||||||||||
Basic
|
32,091 | 28,434 | 21,798 | 27,091 | 19,786 | |||||||||||||||
Diluted
|
32,091 | 28,434 | 21,830 | 27,091 | 19,802 | |||||||||||||||
Earnings (loss) per limited partner unit:
|
||||||||||||||||||||
Basic
|
$ | (0.73 | ) | $ | (0.01 | ) | $ | 0.13 | $ | (0.90 | ) | $ | 0.68 | |||||||
Diluted
|
$ | (0.73 | ) | $ | (0.01 | ) | $ | 0.13 | $ | (0.90 | ) | $ | 0.68 |
9
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,
|
|||||||
2010
|
2010
|
2009
|
2010
|
2009
|
|||||||
Revenue
|
$ |
68,415
|
$ 62,721
|
$ 47,102
|
$ 237,636
|
$ 181,729
|
|||||
Gross Margin, as adjusted (1)
|
$ |
38,786
|
$ 35,980
|
$ 26,938
|
$ 134,798
|
$ 105,495
|
|||||
EBITDA, as further adjusted (1)
|
$ |
31,427
|
$ 28,047
|
$ 21,592
|
$ 104,807
|
$ 83,840
|
|||||
% of Revenue
|
46%
|
45%
|
46%
|
44%
|
46%
|
||||||
Capital Expenditures
|
$ |
6,535
|
$ 4,037
|
$ 3,199
|
$ 28,113
|
$ 17,893
|
|||||
Less: Proceeds from Sale of Compression Equipment
|
(547)
|
(30)
|
(4,457)
|
(1,370)
|
(4,457)
|
||||||
Net Capital Expenditures
|
$ |
5,988
|
$ 4,007
|
$ (1,258)
|
$ 26,743
|
$ 13,436
|
|||||
Gross Margin percentage, as adjusted
|
57%
|
57%
|
57%
|
57%
|
58%
|
||||||
Distributable cash flow (2)
|
$ |
20,372
|
$ 19,272
|
$ 13,207
|
$ 66,831
|
$ 49,809
|
|||||
Distributions per Limited Partner Unit
|
$ |
0.4725
|
$ 0.4675
|
$ 0.4625
|
$ 1.87
|
$ 1.85
|
|||||
Distribution to All Unitholders, including Incentive Distributions
|
$ 16,003
|
$ 15,732
|
$ 11,580
|
$ 54,913
|
$ 39,404
|
||||||
Distributable Cash Flow Coverage
|
1.27x
|
1.23x
|
1.14x
|
1.22x
|
1.26x
|
||||||
December 31,
|
September 30,
|
December 31,
|
December 31,
|
December 31,
|
|||||||
2010
|
2010
|
2009
|
2010
|
2009
|
|||||||
Debt
|
$ |
449,000
|
$ 435,500
|
$ 432,500
|
$ 449,000
|
$ 432,500
|
|||||
Total Partners' Capital
|
$ |
350,737
|
$ 375,941
|
$ 258,308
|
$ 350,737
|
$ 258,308
|
|||||
Total Debt to Capitalization
|
56%
|
54%
|
63%
|
56%
|
63%
|
||||||
EBITDA, as further adjusted (1) to Interest Expense
|
4.8x
|
4.7x
|
3.8x
|
4.4x
|
4.1x
|
||||||
(1) Management believes disclosure of EBITDA, as further adjusted, and Gross Margin, as adjusted, both non-GAAP measures, provides useful information to investors because, when viewed with our GAAP results and accompanying reconciliations, they provide a more complete understanding of our performance than GAAP results alone. Management uses EBITDA, as further adjusted, and Gross Margin, as adjusted, as supplemental measures to review current period operating performance, comparability measures and performance measures for period to period comparisons. In addition, EBITDA, as further adjusted, is used by management 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 generated by us 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.
|
10
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,
|
||||||
2010
|
2010
|
2009
|
2010
|
2009
|
||||||
Reconciliation of GAAP to Non-GAAP Financial Information:
|
||||||||||
Net income (loss)
|
$ (23,497)
|
$ 83
|
$ 3,317
|
$ |
(23,333)
|
$ 14,784
|
||||
Income tax expense
|
162
|
172
|
117
|
680
|
541
|
|||||
Depreciation and amortization
|
15,180
|
13,697
|
10,398
|
52,518
|
36,452
|
|||||
Long-lived asset impairment
|
24,652
|
93
|
156
|
24,976
|
3,151
|
|||||
Cap on operating and selling, general and administrative
|
||||||||||
costs provided by Exterran Holdings ("EXH")
|
7,780
|
7,770
|
1,708
|
24,720
|
7,798
|
|||||
Non-cash selling, general and administrative costs
|
549
|
212
|
256
|
1,209
|
811
|
|||||
Interest expense, net of interest income
|
6,601
|
6,020
|
5,640
|
24,037
|
20,303
|
|||||
EBITDA, as further adjusted (1)
|
31,427
|
28,047
|
21,592
|
104,807
|
83,840
|
|||||
Cash selling, general and administrative costs
|
9,563
|
8,292
|
7,457
|
33,621
|
23,415
|
|||||
Less: cap on selling, general and administrative costs provided by EXH
|
(1,963)
|
(692)
|
(552)
|
(3,316)
|
(552)
|
|||||
Less: other (income) expense, net
|
(241)
|
333
|
(1,559)
|
(314)
|
(1,208)
|
|||||
Gross Margin, as adjusted (1)
|
38,786
|
35,980
|
26,938
|
134,798
|
105,495
|
|||||
Other income, (expense), net
|
241
|
(333)
|
1,559
|
314
|
1,208
|
|||||
Expensed acquisition costs (in Other (income) expense, net)
|
-
|
356
|
452
|
356
|
803
|
|||||
Less: Gain on sale of compression equipment (in Other (income) expense, net)
|
(242)
|
(8)
|
(2,011)
|
(667)
|
(2,011)
|
|||||
Less: Cash interest expense
|
(4,469)
|
(5,747)
|
(5,420)
|
(21,087)
|
(19,697)
|
|||||
Less: Cash selling, general and administrative, as adjusted for
|
||||||||||
cost caps provided by EXH
|
(7,600)
|
(7,600)
|
(6,905)
|
(30,305)
|
(22,863)
|
|||||
Less: Income tax expense
|
(162)
|
(172)
|
(117)
|
(680)
|
(541)
|
|||||
Less: Maintenance capital expenditures
|
(6,182)
|
(3,204)
|
(1,289)
|
(15,898)
|
(12,585)
|
|||||
Distributable cash flow (2)
|
$ 20,372
|
$ 19,272
|
$ 13,207
|
$ |
66,831
|
$ 49,809
|
||||
Cash flows from operating activities
|
$ 6,585
|
$ 11,075
|
$ 5,759
|
$ |
43,682
|
$ 55,936
|
||||
Provision for doubtful accounts
|
(700)
|
(560)
|
(401)
|
(1,292)
|
(627)
|
|||||
Cap on operating and selling, general and administrative costs provided by EXH
|
7,780
|
7,770
|
1,708
|
24,720
|
7,798
|
|||||
Expensed acquisition costs
|
-
|
356
|
452
|
356
|
803
|
|||||
Maintenance capital expenditures
|
(6,182)
|
(3,204)
|
(1,289)
|
(15,898)
|
(12,585)
|
|||||
Change in assets and liabilities
|
12,889
|
3,835
|
6,978
|
15,263
|
(1,516)
|
|||||
Distributable cash flow (2)
|
$ 20,372
|
$ 19,272
|
$ 13,207
|
$ |
66,831
|
$ 49,809
|
||||
Net income (loss)
|
$ (23,497)
|
$ 83
|
$ 3,317
|
$ |
(23,333)
|
$ 14,784
|
||||
Long-lived asset impairment
|
24,652
|
93
|
156
|
24,976
|
3,151
|
|||||
Net income, excluding charge
|
$ 1,155
|
$ 176
|
$ 3,473
|
$ |
1,643
|
$ 17,935
|
||||
Diluted earnings (loss) per limited partner unit
|
$ (0.73)
|
$ (0.01)
|
$ 0.13
|
$ |
(0.90)
|
$ 0.68
|
||||
Adjustment for charge per limited partner unit
|
0.75
|
-
|
0.01
|
0.90
|
0.15
|
|||||
Diluted earnings (loss) per limited partner unit, excluding charge (1)
|
$ 0.02
|
$ (0.01)
|
$ 0.14
|
0.00
|
$ 0.83
|
|||||
(1) Management believes disclosure of EBITDA, as further adjusted, diluted earnings (loss) per limited partner unit, excluding charge, and Gross Margin, as adjusted, non-GAAP measures, provides useful information to investors because, when viewed with our GAAP results and accompanying reconciliations, they provide a more complete understanding of our performance than GAAP results alone. Management uses EBITDA, as further adjusted, diluted earnings (loss) per limited partner unit, excluding charge, and Gross Margin, as adjusted, as supplemental measures to review current period operating performance, comparability measures and performance measures for period to period comparisons. In addition, EBITDA, as further adjusted, is used by management 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 generated by us 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.
|
11
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,
|
||||
2010
|
2010
|
2009
|
2010
|
2009
|
||||
Total Available Horsepower (at period end) (1)
|
1,572
|
1,655
|
1,304
|
1,572
|
1,304
|
|||
Total Operating Horsepower (at period end) (1)
|
1,384
|
1,362
|
1,050
|
1,384
|
1,050
|
|||
Average Operating Horsepower
|
1,364
|
1,208
|
908
|
1,179
|
878
|
|||
Horsepower Utilization:
|
||||||||
Spot (at period end)
|
88%
|
82%
|
81%
|
88%
|
81%
|
|||
Average
|
82%
|
81%
|
79%
|
81%
|
82%
|
|||
Combined U.S. Contract Operations Horsepower of Exterran Holdings
|
||||||||
and Exterran Partners covered by contracts converted to service
|
||||||||
agreements (at period end)
|
1,944
|
1,894
|
1,764
|
1,944
|
1,764
|
|||
Available Horsepower:
|
||||||||
Total Available U.S. Contract Operations Horsepower of Exterran Holdings
|
||||||||
and Exterran Partners (at period end)
|
3,607
|
4,167
|
4,213
|
3,607
|
4,213
|
|||
% of U.S. Contract Operations Available Horsepower of Exterran
|
||||||||
Holdings and Exterran Partners covered by contracts converted
|
||||||||
to service agreements (at period end)
|
54%
|
45%
|
42%
|
54%
|
42%
|
|||
Operating Horsepower:
|
||||||||
Total Operating U.S. Contract Operations Horsepower of Exterran Holdings
|
||||||||
and Exterran Partners (at period end)
|
2,779
|
2,773
|
2,813
|
2,779
|
2,813
|
|||
% of U.S. Contract Operations Operating Horsepower of Exterran
|
||||||||
Holdings and Exterran Partners covered by contracts converted
|
||||||||
to service agreements (at period end)
|
70%
|
68%
|
63%
|
70%
|
63%
|
|||
(1) Includes compressor units leased from Exterran Holdings with an aggregate horsepower (in thousands) of 278, 242 and 145 at December 31, 2010, September 30, 2010 and December 31, 2009, respectively. Excludes compressor units leased to Exterran Holdings with an aggregate horsepower (in thousands) of 18, 18 and 15 at December 31, 2010, September 30, 2010 and December 31, 2009, respectively.
|