The following is a summary of the USA Compression Partners, LP Common Units (USAC) Q3 2024 Earnings Call Transcript:

Financial Performance:

• USAC reported a record Q3 revenue, alongside all-time highs in adjusted gross margin, adjusted EBITDA, and distributable cash flow.

• Net income for Q3 was $19.3 million, with operating income at $75.7 million. Net cash provided by operating activities totaled $48.5 million.

• Revenue increased by 2% sequentially and 11% year-over-year.

• Cash interest expenses were at $47.1 million, slightly higher due to increased average outstanding borrowings.

Business Progress:

• USAC has implemented an initiative to streamline back office operations by adopting the Energy Transfer Shared Services Model, indicating a move towards greater operational efficiency.

• Expansion capital expenditures for full-year 2024 have been increased to between $240 million and $250 million, reflecting the costs associated with preparing for active compression units redeployment and the conversion of idle units to active status.

Opportunities:

• The demand for compression services continues to be strong, which supports further revenue growth from both deployment of existing assets and higher service pricing.

• The company anticipates the deployment of up to 10,000 horsepower of existing uncontracted fleet assets at costs lower than new organic growth equipment builds, highlighting an opportunity for capital-efficient growth.

Risks:

• Higher cash interest expenses due to increased borrowings and changes in the company's capital structure following equipment reconfiguration could impact profitability.

• Variability in operational costs and potential increase in expenses related to the conversion of idle fleet to active status might affect the financial outcomes.

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