CSI Compressco reports growth in 1Q22 revenue

A CSI Compressco presentation from November 2021 shows the company’s areas of operations.

CSI Compressco reported its 1Q22 revenue climbed while its net loss fell compared to the same period one year earlier.

Total revenues were $80 million, up from $69.8 million one year earlier. The company’s net loss was $6.6 million, compared with a net loss of $12.9 million one year earlier.

The company’s revenue from contract services increased to $62.8 million, up from $56.2 million one year earlier. Its adjusted EBITDA was $26.9 million, compared to $23.3 million one year earlier. CSI Compressco’s compression fleet utilization rose to 81.4% from 76.2% one year earlier. Operating horsepower increased to 973,428hp, up from 900,328hp.

CSI Compressco’s results include the operating results of Spartan Treating, which it acquired in November 2021. Also in November, CSI Compressco closed a $52.7 million private placement and issued an additional $10 million in senior secured second lien notes due in 2026.

“During the first quarter of 2022, we began to see the positive effects of the increase in activity levels from our customers. This improvement has led to revenue growth from both higher utilization and improved pricing.,” said CSI Compressco CEO John Jackson. “This revenue growth, along with our proactive management of costs, resulted in an increase in adjusted EBITDA compared to both the fourth quarter of 2021 and the first quarter of 2021.”

The company has orders to redeploy a significant percentage of its idle fleet over the rest of the year. The focus of the company’s incremental capital expenditure for the near future will be redeploying its available fleet as efficiently as possible, which includes convering existing units to electric motor drive, he said.

“Supply chain issues continue to persist across many industries, including the compression sector, but we have been able to be nimble and navigate these issues with our suppliers and our people,” he said “This has allowed us to redeploy equipment in a cost-effective manner this year. We expect the remainder of 2022 to be very active and expect utilization to continue to improve throughout the year.”

The company set its first 1250hp electric motor-drive unit in 1Q22 in response to growing inquiries for electric motor-driven units.

In addition to its existing orders, CSI Compressco has numerous customers exploring the amount, timing and size of their plans for deplyoying electric motor-drive units. To date, the company has converted older existing units to electric drive and it expects to continue these efforts throughout the year and into 2023, Jackson said.

Net cash from operating activities was $11.8 million in 1Q22, compared to net cash provided by operating activities of $11.5 million one year earlier. The company expects capital expenditures for 2022 to fall between $50 and $60 million, figures which include maintenance expenditures between $18 and $22 million. Capital expenditures related to the expansion of its contract services fleet are between $24 and $28 million, the company said.

CSI provides services including natural gas compression and treating services. The company’s compression business includes a fleet of approximately 4800 compressor packages providing approximately 1.2 million in aggregate horsepower, utilizing a full spectrum of low-, medium-, and high-horsepower engines. Its treating fleet includes amine units, gas coolers, and related equipment.