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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Archrock Partners, L.P. Representing Limited Partner Interests (delisted) | NASDAQ:APLP | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 15.30 | 15.05 | 15.30 | 0 | 01:00:00 |
|
Delaware
|
|
22-3935108
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
9807 Katy Freeway, Suite 100
|
|
|
Houston, Texas
|
|
77024
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
Page
|
|
|
|
|
|
|
2006 LTIP
|
The Archrock Partners, L.P. Long Term Incentive Plan, adopted in October 2006
|
2017 Form 10-K
|
Archrock Partners, L.P.’s Annual Report on Form 10-K for the year ended December 31, 2017
|
2017 LTIP
|
The Archrock Partners, L.P. Long Term Incentive Plan, adopted in April 2017
|
Amendment No. 1
|
Amendment No. 1 to Credit Agreement dated February 23, 2018, which amended that certain Credit Agreement, dated as of March 30, 2017, which governs the Credit Facility
|
Archrock
|
Prior to the Merger: Archrock, Inc., individually and together with its wholly-owned subsidiaries
Subsequent to the Merger: Archrock, Inc., individually and together with its wholly-owned subsidiaries, excluding the Partnership
|
ASC Topic 842 Leases
|
Accounting Standards Codification Topic 842 Leases as promulgated by Accounting Standards Update No. 2016-02 Leases (Topic 842) and further updated by Accounting Standards Update No. 2018-11 Leases (Topic 842): Targeted Improvements
|
ASU 2016-13
|
Accounting Standards Update No. 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments
|
ASU 2016-15
|
Accounting Standards Update No. 2016-15 Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments
|
ASU 2017-12
|
Accounting Standards Update No. 2017-12 Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities
|
ASU 2018-13
|
Accounting Standards Update No. 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement
|
Credit Facility
|
$1.25 billion asset-based revolving credit facility, as amended by Amendment No. 1
|
EBITDA
|
Earnings before interest, taxes, depreciation and amortization
|
EES Leasing
|
Archrock Services Leasing LLC, formerly known as EES Leasing LLC
|
Exchange Act
|
Securities Exchange Act of 1934, as amended
|
EXLP Leasing
|
Archrock Partners Leasing LLC, formerly known as EXLP Leasing LLC
|
FASB
|
Financial Accounting Standards Board
|
Financial Statements
|
The Partnership’s Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q
|
Former Credit Facility
|
$825.0 million revolving credit facility and $150.0 million term loan, terminated in March 2017
|
GAAP
|
Accounting principles generally accepted in the U.S.
|
General Partner
|
Archrock General Partner, L.P., the Partnership’s general partner, and an indirect, wholly-owned subsidiary of Archrock
|
Heavy Equipment Statutes
|
Texas Tax Code §§ 23.1241, 23.1242
|
Merger
|
The transaction completed on April 26, 2018 pursuant to the Merger Agreement in which Archrock acquired all of the Partnership’s outstanding common units not already owned by Archrock
|
Merger Agreement
|
Agreement and Plan of Merger, dated as of January 1, 2018, among Archrock and the Partnership, which was amended by Amendment No. 1 to Agreement and Plan of Merger on January 11, 2018, and which was completed and effective on April 26, 2018
|
Notes
|
$350.0 million of 6% senior notes due April 2021 and $350 million of 6% senior notes due October 2022
|
Omnibus Agreement
|
The Partnership’s Fifth Amended and Restated Omnibus Agreement with Archrock, dated as of April 26, 2018
|
Partnership, we, our, us
|
Archrock Partners, L.P., together with its subsidiaries
|
Partnership Agreement
|
First Amended and Restated Agreement of Limited Partnership of Exterran Partners, L.P. (now Archrock Partners, L.P.), as amended, dated as of April 14, 2008
|
Revenue Recognition Update
|
Accounting Standards Update No. 2014-09 Revenue from Contracts with Customers (Topic 606) and additional related standards updates
|
Revolving Loan Agreement
|
Agreement dated April 26, 2018 among the Partnership and Archrock under which the Partnership may make loans to Archrock
|
ROU
|
Right-of-use, as related to the new lease model under ASC Topic 842 Leases
|
SEC
|
U.S. Securities and Exchange Commission
|
SG&A
|
Selling, general and administrative
|
TCJA
|
Public Law No. 115-97, a comprehensive tax reform bill signed into law on December 22, 2017
|
U.S.
|
United States of America
|
•
|
the risk that cost savings, tax benefits and any other synergies from the Merger may not be fully realized or may take longer to realize than expected;
|
•
|
the impact and outcome of pending and future litigation, including litigation, if any, relating to the Merger;
|
•
|
conditions in the oil and natural gas industry, including a sustained decrease in the level of supply or demand for oil or natural gas or a sustained low price of oil or natural gas;
|
•
|
our reduced profit margins or the loss of market share resulting from competition or the introduction of competing technologies by other companies;
|
•
|
our dependence on Archrock to provide personnel and services, including its ability to hire, train and retain key employees and to cost-effectively perform the services necessary to conduct our business;
|
•
|
changes in economic or political conditions, including terrorism and legislative changes;
|
•
|
the inherent risks associated with our operations, such as equipment defects, impairments, malfunctions and natural disasters;
|
•
|
the loss of our status as a partnership for U.S. federal income tax purposes;
|
•
|
the risk that counterparties will not perform their obligations under our financial instruments;
|
•
|
the financial condition of our customers;
|
•
|
our ability to implement certain business and financial objectives, such as:
|
–
|
winning profitable new business;
|
–
|
growing our asset base and enhancing asset utilization;
|
–
|
integrating acquired businesses;
|
–
|
generating sufficient cash; and
|
–
|
accessing the capital markets at an acceptable cost;
|
•
|
liability related to the use of our services;
|
•
|
changes in governmental safety, health, environmental or other regulations, which could require us to make significant expenditures; and
|
•
|
our level of indebtedness and ability to fund our business.
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash
|
$
|
243
|
|
|
$
|
8,078
|
|
Accounts receivable, trade, net of allowance of $946 and $1,296, respectively
|
73,258
|
|
|
67,714
|
|
||
Current portion of interest rate swaps
|
3,592
|
|
|
186
|
|
||
Accrued interest on loan receivable due from Archrock
|
217
|
|
|
—
|
|
||
Total current assets
|
77,310
|
|
|
75,978
|
|
||
Property, plant and equipment
|
2,872,151
|
|
|
2,727,401
|
|
||
Accumulated depreciation
|
(994,422
|
)
|
|
(953,325
|
)
|
||
Property, plant and equipment, net
|
1,877,729
|
|
|
1,774,076
|
|
||
Intangible assets, net
|
49,359
|
|
|
60,747
|
|
||
Contract costs
|
29,531
|
|
|
—
|
|
||
Loan receivable due from Archrock
|
53,500
|
|
|
—
|
|
||
Other long-term assets
|
24,216
|
|
|
19,401
|
|
||
Total assets
|
$
|
2,111,645
|
|
|
$
|
1,930,202
|
|
LIABILITIES AND PARTNERS’ CAPITAL
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable, trade
|
$
|
21,831
|
|
|
$
|
18,368
|
|
Accrued liabilities
|
10,489
|
|
|
7,597
|
|
||
Deferred revenue
|
9,881
|
|
|
1,299
|
|
||
Accrued interest
|
23,163
|
|
|
12,972
|
|
||
Due to Archrock, net
|
3,349
|
|
|
4,683
|
|
||
Current portion of interest rate swaps
|
—
|
|
|
134
|
|
||
Total current liabilities
|
68,713
|
|
|
45,053
|
|
||
Long-term debt
|
1,515,679
|
|
|
1,361,053
|
|
||
Other long-term liabilities
|
9,529
|
|
|
9,356
|
|
||
Total liabilities
|
1,593,921
|
|
|
1,415,462
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
|
|
||
Partners’ capital:
|
|
|
|
|
|||
Common units: 70,231,036 and 70,310,590 issued, respectively
|
493,197
|
|
|
501,023
|
|
||
General partner units: 1,422,458 and 1,421,768 issued and outstanding, respectively
|
11,448
|
|
|
11,582
|
|
||
Accumulated other comprehensive income
|
13,079
|
|
|
4,476
|
|
||
Treasury units: 113,609 common units at December 31, 2017
|
—
|
|
|
(2,341
|
)
|
||
Total partners’ capital
|
517,724
|
|
|
514,740
|
|
||
Total liabilities and partners’ capital
|
$
|
2,111,645
|
|
|
$
|
1,930,202
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue
|
$
|
154,033
|
|
|
$
|
140,191
|
|
|
$
|
451,901
|
|
|
$
|
415,741
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of sales (excluding depreciation and amortization)
|
62,068
|
|
|
62,584
|
|
|
178,596
|
|
|
172,856
|
|
||||
Selling, general and administrative
|
18,143
|
|
|
20,711
|
|
|
57,288
|
|
|
59,325
|
|
||||
Depreciation and amortization
|
34,095
|
|
|
35,787
|
|
|
102,319
|
|
|
108,947
|
|
||||
Long-lived asset impairment
|
3,673
|
|
|
5,368
|
|
|
10,585
|
|
|
14,659
|
|
||||
Interest expense, net
|
22,767
|
|
|
21,839
|
|
|
66,918
|
|
|
63,361
|
|
||||
Debt extinguishment loss
|
—
|
|
|
—
|
|
|
—
|
|
|
291
|
|
||||
Merger-related costs
|
2
|
|
|
—
|
|
|
2,718
|
|
|
—
|
|
||||
Other (income) loss, net
|
126
|
|
|
(2,793
|
)
|
|
(555
|
)
|
|
(3,614
|
)
|
||||
Income (loss) before income taxes
|
13,159
|
|
|
(3,305
|
)
|
|
34,032
|
|
|
(84
|
)
|
||||
Provision for income taxes
|
546
|
|
|
708
|
|
|
648
|
|
|
2,970
|
|
||||
Net income (loss)
|
$
|
12,613
|
|
|
$
|
(4,013
|
)
|
|
$
|
33,384
|
|
|
$
|
(3,054
|
)
|
|
Three Months Ended September 30,
|
|
Nine Months Ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss)
|
$
|
12,613
|
|
|
$
|
(4,013
|
)
|
|
$
|
33,384
|
|
|
$
|
(3,054
|
)
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap gain, net of reclassifications to earnings
|
1,213
|
|
|
2,314
|
|
|
8,376
|
|
|
4,452
|
|
||||
Amortization of terminated interest rate swaps
|
—
|
|
|
257
|
|
|
227
|
|
|
257
|
|
||||
Total other comprehensive income
|
1,213
|
|
|
2,571
|
|
|
8,603
|
|
|
4,709
|
|
||||
Comprehensive income (loss)
|
$
|
13,826
|
|
|
$
|
(1,442
|
)
|
|
$
|
41,987
|
|
|
$
|
1,655
|
|
|
Partners’ Capital
|
|
Treasury Units
|
|
Accumulated
Other Comprehensive Income (Loss)
|
|
|
|||||||||||||||||||||
|
Common Units
|
|
General Partner Units
|
|
|
|
|
|||||||||||||||||||||
|
$
|
|
Units
|
|
$
|
|
Units
|
|
$
|
|
Units
|
|
|
Total
|
||||||||||||||
Balance at January 1, 2017
|
$
|
516,208
|
|
|
65,606,655
|
|
|
$
|
12,027
|
|
|
1,326,965
|
|
|
$
|
(1,892
|
)
|
|
(86,795
|
)
|
|
$
|
(4,170
|
)
|
|
$
|
522,173
|
|
Issuance of common units for vesting of phantom units
|
|
|
89,263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Treasury units purchased
|
|
|
|
|
|
|
|
|
(404
|
)
|
|
(22,977
|
)
|
|
|
|
(404
|
)
|
||||||||||
Issuance of common units
|
60,291
|
|
|
4,600,000
|
|
|
|
|
|
|
|
|
|
|
|
|
60,291
|
|
||||||||||
Issuance of general partner units
|
|
|
|
|
1,305
|
|
|
94,506
|
|
|
|
|
|
|
|
|
1,305
|
|
||||||||||
Contribution (distribution) of capital, net
|
1,798
|
|
|
|
|
(92
|
)
|
|
|
|
|
|
|
|
|
|
1,706
|
|
||||||||||
Cash distributions
|
(57,528
|
)
|
|
|
|
(1,162
|
)
|
|
|
|
|
|
|
|
|
|
(58,690
|
)
|
||||||||||
Unit-based compensation expense
|
753
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
753
|
|
|||||||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net loss
|
(2,991
|
)
|
|
|
|
(63
|
)
|
|
|
|
|
|
|
|
|
|
(3,054
|
)
|
||||||||||
Interest rate swap gain, net of reclassifications to earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
4,452
|
|
|
4,452
|
|
|||||||||||
Amortization of terminated interest rate swaps
|
|
|
|
|
|
|
|
|
|
|
|
|
257
|
|
|
257
|
|
|||||||||||
Balance at September 30, 2017
|
$
|
518,531
|
|
|
70,295,918
|
|
|
$
|
12,015
|
|
|
1,421,471
|
|
|
$
|
(2,296
|
)
|
|
(109,772
|
)
|
|
$
|
539
|
|
|
$
|
528,789
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at January 1, 2018
|
$
|
501,023
|
|
|
70,310,590
|
|
|
$
|
11,582
|
|
|
1,421,768
|
|
|
$
|
(2,341
|
)
|
|
(113,609
|
)
|
|
$
|
4,476
|
|
|
$
|
514,740
|
|
Issuance of common units for vesting of phantom units
|
|
|
53,091
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Treasury units purchased
|
|
|
|
|
|
|
|
|
(250
|
)
|
|
(19,036
|
)
|
|
|
|
(250
|
)
|
||||||||||
Issuance of general partner units
|
|
|
|
|
9
|
|
|
690
|
|
|
|
|
|
|
|
|
9
|
|
||||||||||
Contribution of capital
|
1,544
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,544
|
|
|||||||||||
Cash distributions
|
(52,651
|
)
|
|
|
|
(1,066
|
)
|
|
|
|
|
|
|
|
|
|
(53,717
|
)
|
||||||||||
Unit-based compensation expense
|
314
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
314
|
|
|||||||||||
Impact of adoption of Revenue Recognition Update
|
12,462
|
|
|
|
|
252
|
|
|
|
|
|
|
|
|
|
|
12,714
|
|
||||||||||
Impact of adoption of ASU 2017-12
|
375
|
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
383
|
|
||||||||||
Merger-related adjustments
|
(2,591
|
)
|
|
(132,645
|
)
|
|
|
|
|
|
2,591
|
|
|
132,645
|
|
|
|
|
—
|
|
||||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income
|
32,721
|
|
|
|
|
663
|
|
|
|
|
|
|
|
|
|
|
33,384
|
|
||||||||||
Interest rate swap gain, net of reclassifications to earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
8,376
|
|
|
8,376
|
|
|||||||||||
Amortization of terminated interest rate swaps
|
|
|
|
|
|
|
|
|
|
|
|
|
227
|
|
|
227
|
|
|||||||||||
Balance at September 30, 2018
|
$
|
493,197
|
|
|
70,231,036
|
|
|
$
|
11,448
|
|
|
1,422,458
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
13,079
|
|
|
$
|
517,724
|
|
|
Nine Months Ended September 30,
|
||||||
|
2018
|
|
2017
|
||||
Cash flows from operating activities:
|
|
|
|
|
|
||
Net income (loss)
|
$
|
33,384
|
|
|
$
|
(3,054
|
)
|
Adjustments to reconcile net income (loss) to cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
102,319
|
|
|
108,947
|
|
||
Long-lived asset impairment
|
10,585
|
|
|
14,659
|
|
||
Amortization of deferred financing costs
|
4,371
|
|
|
4,320
|
|
||
Amortization of debt discount
|
1,049
|
|
|
986
|
|
||
Amortization of terminated interest rate swaps
|
227
|
|
|
257
|
|
||
Debt extinguishment loss
|
—
|
|
|
291
|
|
||
Interest rate swaps
|
166
|
|
|
2,028
|
|
||
Unit-based compensation expense
|
314
|
|
|
753
|
|
||
Provision for doubtful accounts
|
773
|
|
|
2,287
|
|
||
Gain on sale of property, plant and equipment
|
(621
|
)
|
|
(3,518
|
)
|
||
Deferred income tax provision
|
294
|
|
|
2,918
|
|
||
Amortization of contract costs
|
7,962
|
|
|
—
|
|
||
Non-cash deferred revenue
|
(9,326
|
)
|
|
—
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable, trade
|
(5,881
|
)
|
|
(10,255
|
)
|
||
Contract costs
|
(21,176
|
)
|
|
—
|
|
||
Deferred revenue
|
14,010
|
|
|
(72
|
)
|
||
Other assets and liabilities
|
13,810
|
|
|
16,625
|
|
||
Net cash provided by operating activities
|
152,260
|
|
|
137,172
|
|
||
Cash flows from investing activities:
|
|
|
|
|
|
||
Capital expenditures
|
(217,692
|
)
|
|
(115,939
|
)
|
||
Proceeds from sale of property, plant and equipment
|
17,336
|
|
|
17,316
|
|
||
Proceeds from insurance
|
252
|
|
|
—
|
|
||
Loan receivable due from Archrock
|
(53,500
|
)
|
|
—
|
|
||
Net cash used in investing activities
|
(253,604
|
)
|
|
(98,623
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
||
Proceeds from borrowings of long-term debt
|
425,830
|
|
|
818,500
|
|
||
Repayments of long-term debt
|
(273,636
|
)
|
|
(846,500
|
)
|
||
Payments for debt issuance costs
|
(3,332
|
)
|
|
(14,855
|
)
|
||
Payments for settlement of interest rate swaps that include financing elements
|
(61
|
)
|
|
(1,405
|
)
|
||
Distributions to unitholders
|
(53,717
|
)
|
|
(58,690
|
)
|
||
Net proceeds from issuance of common units
|
—
|
|
|
60,291
|
|
||
Net proceeds from sale of general partner units
|
9
|
|
|
1,305
|
|
||
Purchases of treasury units
|
(250
|
)
|
|
(404
|
)
|
||
Increase (decrease) in amounts due to Archrock, net
|
(1,334
|
)
|
|
3,440
|
|
||
Net cash provided by (used in) financing activities
|
93,509
|
|
|
(38,318
|
)
|
||
Net increase (decrease) in cash
|
(7,835
|
)
|
|
231
|
|
||
Cash at beginning of period
|
8,078
|
|
|
217
|
|
||
Cash at end of period
|
$
|
243
|
|
|
$
|
448
|
|
Supplemental disclosure of non-cash transactions:
|
|
|
|
|
|
||
Non-cash capital contribution, net from limited and general partner
|
$
|
1,544
|
|
|
$
|
3,855
|
|
Contract operations equipment acquired/exchanged, net
|
$
|
—
|
|
|
$
|
(2,149
|
)
|
|
December 31, 2017
|
|
Adjustments Due to the Revenue Recognition Update
|
|
January 1, 2018
|
||||||
Assets
|
|
|
|
|
|
||||||
Contract costs
|
$
|
—
|
|
|
$
|
16,316
|
|
|
$
|
16,316
|
|
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
||||||
Accrued liabilities
|
$
|
7,597
|
|
|
$
|
186
|
|
|
$
|
7,783
|
|
Deferred revenue
|
1,299
|
|
|
3,416
|
|
|
4,715
|
|
|||
|
|
|
|
|
|
||||||
Partners
’
capital
|
|
|
|
|
|
||||||
Common units
|
$
|
501,023
|
|
|
$
|
12,462
|
|
|
$
|
513,485
|
|
General partner units
|
11,582
|
|
|
252
|
|
|
11,834
|
|
|
September 30, 2018
|
|
|
||||||||
Balance Sheet
|
As Reported
|
|
Balance Excluding the Impact of the Revenue Recognition Update
|
|
Effect of Change
|
||||||
Assets
|
|
|
|
|
|
||||||
Accounts receivable, trade
|
$
|
73,258
|
|
|
$
|
72,902
|
|
|
$
|
356
|
|
Contract costs
|
29,531
|
|
|
—
|
|
|
29,531
|
|
|||
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
||||||
Accrued liabilities
|
$
|
10,489
|
|
|
$
|
10,256
|
|
|
$
|
233
|
|
Deferred revenue
|
9,881
|
|
|
2,137
|
|
|
7,744
|
|
|||
Other long-term liabilities
|
9,529
|
|
|
9,534
|
|
|
(5
|
)
|
|||
|
|
|
|
|
|
||||||
Equity
|
|
|
|
|
|
||||||
Common units
|
$
|
493,197
|
|
|
$
|
471,779
|
|
|
$
|
21,418
|
|
General partner units
|
11,448
|
|
|
10,951
|
|
|
497
|
|
|
Three Months Ended September 30, 2018
|
|
|
||||||||
Statement of Operations
|
As Reported
|
|
Balance Excluding the Impact of the Revenue Recognition Update
|
|
Effect of Change
|
||||||
Revenue
|
$
|
154,033
|
|
|
$
|
155,377
|
|
|
$
|
(1,344
|
)
|
Cost of sales (excluding depreciation and amortization)
|
62,068
|
|
|
66,388
|
|
|
(4,320
|
)
|
|||
Selling, general and administrative
|
18,143
|
|
|
18,693
|
|
|
(550
|
)
|
|||
Provision for income taxes
|
546
|
|
|
539
|
|
|
7
|
|
|||
Net income
|
12,613
|
|
|
9,094
|
|
|
3,519
|
|
|
Nine Months Ended September 30, 2018
|
|
|
||||||||
Statement of Operations
|
As Reported
|
|
Balance Excluding the Impact of the Revenue Recognition Update
|
|
Effect of Change
|
||||||
Revenue
|
$
|
451,901
|
|
|
$
|
455,920
|
|
|
$
|
(4,019
|
)
|
Cost of sales (excluding depreciation and amortization)
|
178,596
|
|
|
190,425
|
|
|
(11,829
|
)
|
|||
Selling, general and administrative
|
57,288
|
|
|
58,674
|
|
|
(1,386
|
)
|
|||
Provision for income taxes
|
648
|
|
|
653
|
|
|
(5
|
)
|
|||
Net income
|
33,384
|
|
|
24,183
|
|
|
9,201
|
|
|
Three Months Ended September 30, 2018
|
|
Nine Months Ended September 30, 2018
|
||||
0 - 1,000 horsepower per unit
|
$
|
55,215
|
|
|
$
|
164,031
|
|
1,001 - 1,500 horsepower per unit
|
63,806
|
|
|
187,890
|
|
||
Over 1,500 horsepower per unit
|
34,156
|
|
|
98,056
|
|
||
Other
(1)
|
856
|
|
|
1,924
|
|
||
Total revenue
(2)
|
$
|
154,033
|
|
|
$
|
451,901
|
|
(1)
|
Primarily relates to fees associated with Partnership-owned non-compressor equipment.
|
(2)
|
Includes
$1.4 million
and
$3.9 million
for
three and nine
months ended
September 30, 2018
, respectively, related to billable maintenance on Partnership-owned units that was recognized at a point in time. All other revenue is recognized over time.
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Total
|
||||||||||||
Remaining performance obligations
|
$
|
85,439
|
|
|
$
|
110,145
|
|
|
$
|
44,906
|
|
|
$
|
8,132
|
|
|
$
|
1,073
|
|
|
$
|
249,695
|
|
•
|
Archrock’s obligation to provide all operational staff, corporate staff and support services reasonably necessary to operate our business and our obligation to reimburse Archrock for such services;
|
•
|
the terms under which we, Archrock and our respective affiliates may transfer, exchange or lease compression equipment among one another;
|
•
|
Archrock’s grant to us of a license to use certain intellectual property, including the “Archrock” logo; and
|
•
|
Archrock’s and our obligations to indemnify each other for certain liabilities.
|
|
Nine Months Ended September 30, 2017
|
||||||
|
Transferred to Archrock
|
|
Transferred from Archrock
|
||||
Compressor units
|
199
|
|
|
170
|
|
||
Horsepower
|
109,800
|
|
|
99,500
|
|
||
Net book value
|
$
|
47,824
|
|
|
$
|
45,664
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Equipment on lease to Archrock
|
|
|
|
||||
Aggregate cost
|
$
|
40,212
|
|
|
$
|
3,560
|
|
Accumulated depreciation
|
5,783
|
|
|
272
|
|
||
|
|
|
|
||||
Equipment on lease from Archrock
|
|
|
|
||||
Aggregate cost
|
$
|
67,048
|
|
|
$
|
224
|
|
Accumulated depreciation
|
33,337
|
|
|
34
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Credit Facility
|
$
|
826,500
|
|
|
$
|
674,306
|
|
|
|
|
|
||||
6% senior notes due April 2021
|
350,000
|
|
|
350,000
|
|
||
Less: Debt discount, net of amortization
|
(1,977
|
)
|
|
(2,523
|
)
|
||
Less: Deferred financing costs, net of amortization
|
(2,568
|
)
|
|
(3,338
|
)
|
||
|
345,455
|
|
|
344,139
|
|
||
|
|
|
|
||||
6% senior notes due October 2022
|
350,000
|
|
|
350,000
|
|
||
Less: Debt discount, net of amortization
|
(2,938
|
)
|
|
(3,441
|
)
|
||
Less: Deferred financing costs, net of amortization
|
(3,338
|
)
|
|
(3,951
|
)
|
||
|
343,724
|
|
|
342,608
|
|
||
Long-term debt
|
$
|
1,515,679
|
|
|
$
|
1,361,053
|
|
•
|
increase the maximum Total Debt to EBITDA ratios, as defined in the Credit Facility agreement (see below for the revised ratios), effective as of the execution of Amendment No. 1 on February 23, 2018; and
|
•
|
effective upon completion of the Merger on April 26, 2018:
|
–
|
increase the aggregate revolving commitment from
$1.1 billion
to
$1.25 billion
;
|
–
|
increase the amount available for the issuance of letters of credit from
$25.0 million
to
$50.0 million
;
|
–
|
increase the basket sizes under certain covenants including covenants limiting our ability to make investments, incur debt, make restricted payments, incur liens and make asset dispositions;
|
–
|
name Archrock Services, L.P., one of Archrock’s subsidiaries, as a borrower under the Credit Facility and certain of Archrock’s other subsidiaries as loan guarantors; and
|
–
|
amend the definition of “Borrowing Base” to include certain assets of Archrock’s subsidiaries.
|
(1)
|
Subject to a temporary increase to
5.5
to 1.0 for any quarter during which an acquisition satisfying certain thresholds is completed and for the two quarters immediately following such quarter.
|
|
Fair Value Asset (Liability)
|
||||||
|
September 30, 2018
|
|
December 31, 2017
|
||||
Current portion of interest rate swaps
|
$
|
3,592
|
|
|
$
|
186
|
|
Other long-term assets
|
9,487
|
|
|
4,490
|
|
||
Current portion of interest rate swaps
|
—
|
|
|
(134
|
)
|
||
|
$
|
13,079
|
|
|
$
|
4,542
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Pre-tax gain recognized in other comprehensive income (loss)
|
$
|
1,642
|
|
|
$
|
1,919
|
|
|
$
|
8,583
|
|
|
$
|
2,282
|
|
Pre-tax gain (loss) reclassified from accumulated other comprehensive income (loss) into interest expense, net
|
429
|
|
|
(652
|
)
|
|
(20
|
)
|
|
(2,427
|
)
|
|
Three Months Ended September 30, 2018
|
|
Nine Months Ended September 30, 2018
|
||||
Total amount of interest expense, net in which the effects of cash flow hedges are recorded
|
$
|
22,767
|
|
|
$
|
66,918
|
|
Amount of gain reclassified from accumulated other comprehensive income (loss) into interest expense, net
|
429
|
|
|
582
|
|
•
|
Level 1 — Quoted unadjusted prices for identical instruments in active markets to which we have access at the date of measurement.
|
•
|
Level 2 — Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, little public information exists or prices vary substantially over time or among brokered market makers.
|
•
|
Level 3 — Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect our own assumptions regarding how market participants would price the asset or liability based on the best available information.
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Interest rate swaps asset
|
$
|
13,079
|
|
|
$
|
4,676
|
|
Interest rate swaps liability
|
—
|
|
|
(134
|
)
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Carrying amount of fixed rate debt
(1)
|
$
|
689,179
|
|
|
$
|
686,747
|
|
Fair value of fixed rate debt
|
706,000
|
|
|
702,000
|
|
(1)
|
Carrying amounts are shown net of unamortized debt discounts and unamortized deferred financing costs. See
Note 6
(“Long-Term Debt”)
for further details.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Idle compressor units retired from the active fleet
|
35
|
|
|
45
|
|
|
140
|
|
|
150
|
|
||||
Horsepower of idle compressor units retired from the active fleet
|
14,000
|
|
|
18,000
|
|
|
44,000
|
|
|
53,000
|
|
||||
Impairment recorded on idle compressor units retired from the active fleet
|
$
|
3,673
|
|
|
$
|
5,368
|
|
|
$
|
10,585
|
|
|
$
|
14,659
|
|
|
Nine Months Ended
September 30, |
||||||
|
2018
|
|
2017
|
||||
Revenue
|
$
|
451,901
|
|
|
$
|
415,741
|
|
|
|
|
|
||||
Cost of sales (excluding depreciation and amortization)
|
178,596
|
|
|
172,856
|
|
||
Selling, general and administrative
|
57,288
|
|
|
59,325
|
|
||
Depreciation and amortization
|
102,319
|
|
|
108,947
|
|
||
Long-lived asset impairment
|
10,585
|
|
|
14,659
|
|
||
Interest expense, net
|
66,918
|
|
|
63,361
|
|
||
Debt extinguishment loss
|
—
|
|
|
291
|
|
||
Merger-related costs
|
2,718
|
|
|
—
|
|
||
Other income, net
|
(555
|
)
|
|
(3,614
|
)
|
||
Provision for income taxes
|
648
|
|
|
2,970
|
|
||
Net income (loss)
|
$
|
33,384
|
|
|
$
|
(3,054
|
)
|
|
Nine Months Ended September 30,
|
||||||
|
2018
|
|
2017
|
||||
Idle compressor units retired from the active fleet
|
140
|
|
|
150
|
|
||
Horsepower of idle compressor units retired from the active fleet
|
44,000
|
|
|
53,000
|
|
||
Impairment recorded on idle compressor units retired from the active fleet
|
$
|
10,585
|
|
|
$
|
14,659
|
|
Exhibit No.
|
|
Description
|
2.1
|
|
|
2.2
|
|
|
3.1
|
|
|
3.2
|
|
|
3.3
|
|
|
3.4
|
|
|
3.5
|
|
|
3.6
|
|
|
3.7
|
|
|
3.8
|
|
|
3.9
|
|
|
3.10
|
|
|
4.1
|
|
|
4.2
|
|
|
4.3
|
|
|
4.4
|
|
|
31.1*
|
|
|
31.2*
|
|
|
32.1**
|
|
|
32.2**
|
|
|
101.1*
|
|
Interactive data files pursuant to Rule 405 of Regulation S-T
|
*
|
Filed herewith.
|
**
|
Furnished, not filed.
|
|
ARCHROCK PARTNERS, L.P.
|
|
|
|
|
|
By:
|
ARCHROCK GENERAL PARTNER, L.P.
|
|
|
its General Partner
|
|
|
|
|
By:
|
ARCHROCK GP LLC
|
|
|
its General Partner
|
|
|
|
|
By:
|
/s/ DOUGLAS S. ARON
|
|
|
Douglas S. Aron
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
|
|
By:
|
/s/ DONNA A. HENDERSON
|
|
|
Donna A. Henderson
|
|
|
Vice President and Chief Accounting Officer
|
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
November 1, 2018
|
1 Year Archrock Partners, L.P. Chart |
1 Month Archrock Partners, L.P. Chart |
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