Archrock reports solid 2022 results

Archrock operates the largest fleet of contract compression in the U.S. technicians are available in multiple producing basins throughout the U.S. (map: Archrcock.)

Archrock reported its 2022 net income and revenue were up significantly from the prior year while adjusted EBITDA was moderately stronger.

Revenue for 2022 was $845.6 million, up from $781.5 million in 2021. Net income was $44.3 million, up from $28.2 million the previous year. The company’s compression fleet was utilized at 93%, up from 84% at the end of 2021.

“We closed out 2022 with significant operating momentum and solid financial performance,” said Brad Childers, Archrock’s president and CEO. “For the full year 2022, we grew operating horsepower by approximately 375,000 horsepower, excluding non-strategic asset sales, drove a 900 basis point increase in our period-end utilization to 93% and generated net income and earnings per share growth.”

After selling off small non-strategic compressors, about 84% of its fleet is made up of large horsepower compressors. The improved results for 2022  stem from strong market fundamentals for the compression industry “that are as exciting as I have ever seen,” he said. The company reports record utilization, strong demand and significantly higher pricing for its compressors.

“As the demand for compression exceeds available equipment, we plan to capitalize on the opportunity to redeploy the proceeds received from non-strategic asset sales for investment in large horsepower compression units,” he said.

Archrock’s full year 2022 net income of $44.3 million included the following items: non-cash long-lived and other asset impairment of $21.4 million and a non-cash unrealized change in the fair value of our investment in an unconsolidated affiliate of $1.9 million, the company reported.

For the fourth quarter of 2022, contract operations segment revenue totaled $177.4 million, up 11% from the $159.5 million reported a year earlier. Archrock’s total operating horsepower at the end of the fourth quarter of 2022 was 3.4 million compared with 3.2 million at the end of the fourth quarter of 2021, and reflected the sale of 176,000 active horsepower as part of the company’s ongoing fleet high-grading initiative.