Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 29, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-35779 | |
Entity Registrant Name | USA Compression Partners, LP | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 75-2771546 | |
Entity Address, Address Line One | 111 Congress Avenue | |
Entity Address, Address Line Two | Suite 2400 | |
Entity Address, City or Town | Austin | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78701 | |
City Area Code | 512 | |
Local Phone Number | 473-2662 | |
Title of 12(b) Security | Common units representing limited partner interests | |
Trading Symbol | USAC | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Units outstanding (in units) | 97,022,290 | |
Entity Central Index Key | 0001522727 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 99 | $ 2 |
Accounts receivable: | ||
Trade, net of allowances | 69,685 | 63,727 |
Other | 1,898 | 3,707 |
Related party receivables | 44,923 | 45,043 |
Inventories | 84,740 | 84,632 |
Prepaid expenses and other assets | 2,923 | 2,444 |
Total current assets | 204,268 | 199,555 |
Property and equipment, net | 2,332,212 | 2,380,633 |
Lease right-of-use assets | 22,220 | 22,766 |
Identifiable intangible assets, net | 326,446 | 333,791 |
Other assets | 10,805 | 11,955 |
Total assets | 2,895,951 | 2,948,700 |
Current liabilities: | ||
Accounts payable | 13,869 | 13,531 |
Accrued liabilities | 87,368 | 109,539 |
Deferred revenue | 48,792 | 47,202 |
Total current liabilities | 150,029 | 170,272 |
Long-term debt, net | 1,956,751 | 1,927,005 |
Operating lease liabilities | 20,643 | 21,220 |
Other liabilities | 15,405 | 15,239 |
Total liabilities | 2,142,828 | 2,133,736 |
Commitments and contingencies | ||
Preferred Units | 477,309 | 477,309 |
Partners’ capital: | ||
Common units, 97,022 and 96,962 units issued and outstanding, respectively | 261,835 | 323,676 |
Warrants | 13,979 | 13,979 |
Total partners’ capital | 275,814 | 337,655 |
Total liabilities, Preferred Units and partners’ capital | $ 2,895,951 | $ 2,948,700 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for credit losses | $ 3,541 | $ 4,982 |
Common units issued (in shares) | 97,022 | 96,962 |
Common units outstanding (in shares) | 97,022 | 96,962 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues: | ||
Contract operations | $ 152,525,000 | $ 172,794,000 |
Parts and service | 2,038,000 | 3,048,000 |
Related party | 2,950,000 | 3,157,000 |
Total revenues | 157,513,000 | 178,999,000 |
Costs and expenses: | ||
Cost of operations, exclusive of depreciation and amortization | 48,628,000 | 59,165,000 |
Depreciation and amortization | 61,030,000 | 58,762,000 |
Selling, general and administrative | 13,800,000 | 12,385,000 |
Gain on disposition of assets | (1,255,000) | (1,014,000) |
Impairment of compression equipment | 2,550,000 | 0 |
Impairment of goodwill | 0 | 619,411,000 |
Total costs and expenses | 124,753,000 | 748,709,000 |
Operating income (loss) | 32,760,000 | (569,710,000) |
Other income (expense): | ||
Interest expense, net | (32,288,000) | (32,478,000) |
Other | 25,000 | 23,000 |
Total other expense | (32,263,000) | (32,455,000) |
Net income (loss) before income tax expense | 497,000 | (602,165,000) |
Income tax expense | 126,000 | 296,000 |
Net income (loss) | 371,000 | (602,461,000) |
Less: distributions on Preferred Units | (12,187,000) | (12,187,000) |
Net loss attributable to common unitholders’ interests | $ (11,816,000) | $ (614,648,000) |
Weighted average common units outstanding - basic (in shares) | 96,989 | 96,707 |
Weighted average common units outstanding - diluted (in shares) | 96,989 | 96,707 |
Basic net loss per common unit (in dollars per share) | $ (0.12) | $ (6.36) |
Diluted net loss per common unit (in dollars per share) | (0.12) | (6.36) |
Distributions declared per common unit for respective periods (in dollars per share) | $ 0.525 | $ 0.525 |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Changes in Partners' Capital - USD ($) $ in Thousands | Total | Common units | Warrants |
Beginning balance Partners' capital at Dec. 31, 2019 | $ 1,180,598 | $ 1,166,619 | $ 13,979 |
Increase (Decrease) in Partners' Capital | |||
Vesting of phantom units | 1,065 | 1,065 | 0 |
Distributions and DERs | (50,755) | (50,755) | 0 |
Issuance of common units under the DRIP | 301 | 301 | 0 |
Unit-based compensation for equity classified awards | 55 | 55 | 0 |
Net loss attributable to common unitholders’ interests | (614,648) | (614,648) | 0 |
Ending balance Partners' capital at Mar. 31, 2020 | 516,616 | 502,637 | 13,979 |
Beginning balance Partners' capital at Dec. 31, 2020 | 337,655 | 323,676 | 13,979 |
Increase (Decrease) in Partners' Capital | |||
Vesting of phantom units | 391 | 391 | 0 |
Distributions and DERs | (50,931) | (50,931) | 0 |
Issuance of common units under the DRIP | 463 | 463 | 0 |
Unit-based compensation for equity classified awards | 52 | 52 | 0 |
Net loss attributable to common unitholders’ interests | (11,816) | (11,816) | 0 |
Ending balance Partners' capital at Mar. 31, 2021 | $ 275,814 | $ 261,835 | $ 13,979 |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Changes in Partners' Capital (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Common units | ||
Distribution and DERs (in dollars per share) | $ 0.525 | $ 0.525 |
Unaudited Condensed Consolida_6
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 371 | $ (602,461) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 61,030 | 58,762 |
Provision for expected credit losses | (1,250) | 1,500 |
Amortization of debt issuance costs | 2,281 | 1,986 |
Unit-based compensation expense (benefit) | 4,182 | (1,829) |
Deferred income tax expense (benefit) | (99) | 123 |
Gain on disposition of assets | (1,255) | (1,014) |
Impairment of compression equipment | 2,550 | 0 |
Impairment of goodwill | 0 | 619,411 |
Changes in assets and liabilities: | ||
Accounts receivable and related party receivables, net | (2,779) | 7,120 |
Inventories | (3,261) | (8,046) |
Prepaid expenses and other current assets | (479) | (556) |
Other assets | 706 | 754 |
Accounts payable | 1,316 | 5,036 |
Accrued liabilities and deferred revenue | (23,701) | (30,709) |
Net cash provided by operating activities | 39,612 | 50,077 |
Cash flows from investing activities: | ||
Capital expenditures, net | (6,185) | (45,275) |
Proceeds from disposition of property and equipment | 420 | 1,881 |
Proceeds from insurance recovery | 1,559 | 1,324 |
Net cash used in investing activities | (4,206) | (42,070) |
Cash flows from financing activities: | ||
Proceeds from revolving credit facility | 190,511 | 250,008 |
Payments on revolving credit facility | (161,633) | (193,408) |
Cash paid related to net settlement of unit-based awards | (289) | (644) |
Deferred financing costs | 0 | (153) |
Other | (140) | (250) |
Net cash used in financing activities | (35,309) | (8,015) |
Increase (decrease) in cash and cash equivalents | 97 | (8) |
Cash and cash equivalents, beginning of period | 2 | 10 |
Cash and cash equivalents, end of period | 99 | 2 |
Supplemental cash flow information: | ||
Cash paid for interest, net of capitalized amounts | 55,391 | 56,046 |
Cash paid for income taxes | 13 | 0 |
Supplemental non-cash transactions: | ||
Non-cash distributions to certain common unitholders (DRIP) | 463 | 301 |
Transfers from inventories to property and equipment | 3,139 | 7,576 |
Changes in capital expenditures included in accounts payable and accrued liabilities | (800) | 2,201 |
Financing costs included in accounts payable and accrued liabilities | 139 | 268 |
Common units | ||
Cash flows from financing activities: | ||
Cash distributions | (51,571) | (51,381) |
Preferred Units | ||
Cash flows from financing activities: | ||
Cash distributions | $ (12,187) | $ (12,187) |
Organization and Description of
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Unless otherwise indicated, the terms “our,” “we,” “us,” “the Partnership” and similar language refer to USA Compression Partners, LP, collectively with its consolidated operating subsidiaries. We are a Delaware limited partnership. Through our operating subsidiaries, we provide compression services under fixed-term contracts with customers in the natural gas and crude oil industries, using natural gas compression packages that we design, engineer, own, operate and maintain. We also own and operate a fleet of equipment used to provide natural gas treating services, such as carbon dioxide and hydrogen sulfide removal, cooling, and dehydration. We primarily provide compression services in a number of shale plays throughout the U.S., including the Utica, Marcellus, Permian Basin, Delaware Basin, Eagle Ford, Mississippi Lime, Granite Wash, Woodford, Barnett, Haynesville, Niobrara and Fayetteville shales. USA Compression GP, LLC, a Delaware limited liability company, serves as our general partner and is referred to herein as the “General Partner.” As of March 31, 2021, the General Partner was wholly-owned by ETO. On April 1, 2021, Energy Transfer LP (“ET”), ETO and certain of their affiliates consummated an internal reorganization. In connection with the reorganization, ETO merged with and into ET, with ET surviving the merger (the “ETO Merger”). As a result of the ETO Merger, the General Partner became wholly-owned by ET. The accompanying unaudited condensed consolidated financial statements include the accounts of the Partnership and its operating subsidiaries, all of which are wholly-owned by us. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation Our accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and pursuant to the rules and regulations of the SEC. In the opinion of our management, such financial information reflects all normal recurring adjustments necessary for a fair presentation of these interim unaudited condensed consolidated financial statements in accordance with GAAP. Operating results for the three months ended March 31, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements contained in our annual report on Form 10-K for the year ended December 31, 2020 filed on February 16, 2021 (our “2020 Annual Report”). Use of Estimates Our unaudited condensed consolidated financial statements have been prepared in conformity with GAAP, which includes the use of estimates and assumptions by management that affect the reported amounts of assets, liabilities, revenues, expenses and disclosure of contingent assets and liabilities that existed at the date of the unaudited condensed consolidated financial statements. Although these estimates were based on management’s available knowledge of current and expected future events, actual results could differ from these estimates. Significant Accounting Policies Cash and Cash Equivalents Cash and cash equivalents consist of all cash balances. We consider investments in highly liquid financial instruments purchased with an original maturity of 90 days or less to be cash equivalents. Trade Accounts Receivable Trade accounts receivable are recorded at the invoiced amount. Allowance for Credit Losses We evaluate our allowance for credit losses related to our two financial assets measured at amortized cost: (i) trade accounts receivable and (ii) net investment in lease related to our sales-type lease discussed further in Note 7. Due to the short- term nature of our trade accounts receivable, we consider the amortized cost to be the same as the carrying amount of the receivable, excluding the allowance for credit losses. Our determination of the allowance for credit losses requires us to make estimates and judgments regarding our customers’ ability to pay amounts due and is the same process for both of our financial assets as they have similar risk characteristics. We continuously evaluate the financial strength of our customers and the overall business climate in which our customers operate and make adjustments to the allowance for credit losses as necessary. We evaluate the financial strength of our customers by reviewing the aging of their receivables, our collection experience with the customer, correspondence, financial information and third-party credit ratings. We evaluate the business climate in which our customers operate by reviewing various publicly available materials regarding our customers’ industry, including the solvency of various companies in the industry. Inventories Inventories consist of serialized and non-serialized parts used primarily on compression units. All inventories are stated at the lower of cost or net realizable value. Serialized parts inventories are determined using the specific identification cost method, while non-serialized parts inventories are determined using the weighted average cost method. Purchases of inventories are considered operating activities on the unaudited condensed consolidated statements of cash flows. Property and Equipment Property and equipment are carried at cost except for (i) certain acquired assets which are recorded at fair value on their respective acquisition dates and (ii) impaired assets which are recorded at fair value on the last impairment evaluation date for which an adjustment was required. Overhauls and major improvements that increase the value or extend the life of compression equipment are capitalized and depreciated over three When property and equipment is retired or sold, its carrying value and the related accumulated depreciation are removed from our accounts and any associated gains or losses are recorded on the unaudited condensed consolidated statements of operations in the period of sale or disposition. Capitalized interest is calculated by multiplying our monthly effective interest rate on outstanding debt by the amount of qualifying costs, which include upfront payments to acquire certain compression units. Capitalized interest was $3,000 and $142,000 for the three months ended March 31, 2021 and 2020, respectively. Impairment of Long-Lived Assets Long-lived assets with recorded values that are not expected to be recovered through future cash flows are written-down to estimated fair value. We test long-lived assets for impairment when events or circumstances indicate that the assets’ carrying value may not be recoverable or will no longer be utilized in the operating fleet. The most common circumstance requiring compression units to be evaluated for impairment is when idle units do not meet the desired performance characteristics of our active revenue generating horsepower. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value of the long-lived asset exceeds the sum of the undiscounted cash flows associated with the asset, an impairment loss equal to the amount of the carrying value exceeding the fair value of the asset is recognized. The fair value of the asset is measured using quoted market prices or, in the absence of quoted market prices, based on an estimate of discounted cash flows, the expected net sale proceeds compared to the other similarly configured fleet units we recently sold or a review of other units recently offered for sale by third parties, or the estimated component value of the equipment we plan to use. Refer to Note 5 for more detailed information about impairment charges during the three months ended March 31, 2021 and 2020. Identifiable Intangible Assets Identifiable intangible assets are recorded at cost and amortized using the straight-line method over their estimated useful lives, which is the period over which the assets are expected to contribute directly or indirectly to our future cash flows. The estimated useful lives of our intangible assets range from 15 to 25 years. Revenue Recognition Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of our services or goods. Revenue is measured at the amount of consideration we expect to receive in exchange for providing services or transferring goods. Incidental items, if any, that are immaterial in the context of the contract are recognized as expenses. Income Taxes We are organized as a partnership for U.S. federal and state income tax purposes. As a result, our partners are responsible for U.S. federal and state income taxes based upon their distributive share of our items of income, gain, loss or deduction. Texas imposes an entity-level income tax on partnerships that is based on Texas sourced taxable margin (the “Texas Margin Tax”). We have included in the unaudited condensed consolidated financial statements a provision for the Texas Margin Tax. Pass Through Taxes Sales taxes incurred on behalf of, and passed through to, customers are accounted for on a net basis. Fair Value Measurements Accounting standards on fair value measurements establish a framework for measuring fair value and stipulate disclosures about fair value measurements. The standards apply to recurring and non-recurring financial and non-financial assets and liabilities that require or permit fair value measurements. Among the required disclosures is the fair value hierarchy of inputs we use to value an asset or a liability. The three levels of the fair value hierarchy are described as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access at the measurement date. Level 2 inputs are those other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. As of March 31, 2021, our financial instruments consisted primarily of cash and cash equivalents, trade accounts receivable, trade accounts payable and long-term debt. The book values of cash and cash equivalents, trade accounts receivable and trade accounts payable are representative of fair value due to their short-term maturities. The carrying amount of our revolving credit facility approximates fair value due to the floating interest rates associated with the debt. The fair value of our Senior Notes 2026 and Senior Notes 2027 were estimated using quoted prices in inactive markets and are considered Level 2 measurements. The following table summarizes the aggregate principal amount and fair value of our Senior Notes 2026 and Senior Notes 2027 (in thousands): March 31, December 31, Senior Notes 2026, aggregate principal $ 725,000 $ 725,000 Fair value of Senior Notes 2026 743,125 761,250 Senior Notes 2027, aggregate principal 750,000 750,000 Fair value of Senior Notes 2027 776,250 800,625 Operating Segment We operate in a single business segment, the compression services business. |
Trade Accounts Receivable
Trade Accounts Receivable | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Trade Accounts Receivable | Trade Accounts ReceivableThe allowance for credit losses, which was $3.5 million and $5.0 million as of March 31, 2021 and December 31, 2020, respectively, is our best estimate of the amount of probable credit losses included in our existing accounts receivable. The following summarizes activity within our trade accounts receivable allowance for credit losses balance (in thousands): Allowance for Credit Losses Balance as of December 31, 2020 $ 4,982 Current-period provision for expected credit losses (1,250) Writeoffs charged against the allowance (191) Balance as of March 31, 2021 $ 3,541 For the three months ended March 31, 2021, we recognized a $1.3 million reversal of our provision for expected credit losses. Improved market conditions for customers due to a recovery in crude oil prices was the primary factor contributing to the decrease to the allowance for credit losses for the three months ended March 31, 2021. For the three months ended March 31, 2020, we recognized a $1.5 million provision for expected credit losses. Low crude oil prices, driven by decreased demand for and global oversupply of crude oil as a result of the COVID-19 pandemic, was the primary factor contributing to the higher allowance for credit losses for the three months ended March 31, 2020. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Components of inventories are as follows (in thousands): March 31, December 31, Serialized parts $ 42,448 $ 42,233 Non-serialized parts 42,292 42,399 Total inventories $ 84,740 $ 84,632 |
Property and Equipment, Identif
Property and Equipment, Identifiable Intangible Assets and Goodwill | 3 Months Ended |
Mar. 31, 2021 | |
Property and Equipment and Identifiable Intangible Assets | |
Property and Equipment, Identifiable Intangible Assets and Goodwill | Property and Equipment, Identifiable Intangible Assets and Goodwill Property and Equipment Property and equipment consisted of the following (in thousands): March 31, December 31, Compression and treating equipment $ 3,482,751 $ 3,480,660 Computer equipment 53,981 53,887 Automobiles and vehicles 33,276 33,412 Leasehold improvements 8,238 8,218 Buildings 5,334 5,334 Furniture and fixtures 1,111 1,110 Land 77 77 Total property and equipment, gross 3,584,768 3,582,698 Less: accumulated depreciation and amortization (1,252,556) (1,202,065) Total property and equipment, net $ 2,332,212 $ 2,380,633 Depreciation is calculated using the straight-line method over the estimated useful lives of the assets as follows: Compression equipment, acquired new 25 years Compression equipment, acquired used 5 - 25 years Furniture and fixtures 3 - 10 years Vehicles and computer equipment 1 - 10 years Buildings 5 years Leasehold improvements 5 years Depreciation expense on property and equipment and gain on disposition of assets were as follows (in thousands): Three Months Ended March 31, 2021 2020 Depreciation expense $ 53,685 $ 51,417 Gain on disposition of assets 1,255 1,014 As of March 31, 2021 and December 31, 2020, there was $2.0 million and $2.8 million , respectively, of property and equipment purchases in accounts payable and accrued liabilities. On a quarterly basis, we evaluate the future deployment of our idle fleet under current market conditions. For the three months ended March 31, 2021, we determined to retire 12 compressor units for a total of approximately 5,600 horsepower that were previously used to provide compression services in our business. As a result, we recorded an impairment of compression equipment of $2.6 million for the three months ended March 31, 2021. The primary causes for these impairments were: (i) units were not considered marketable in the foreseeable future, (ii) units were subject to excessive maintenance costs or (iii) units were unlikely to be accepted by customers due to certain performance characteristics of the unit, such as the inability to meet current quoting criteria without excessive retrofitting costs. These compression units were written down to their respective estimated salvage values, if any. No impairment was recorded for the three months ended March 31, 2020. Identifiable Intangible Assets Identifiable intangible assets, net consisted of the following (in thousands): Customer Relationships Trade Names Total Net balance as of December 31, 2020 $ 302,952 $ 30,839 $ 333,791 Amortization expense (6,526) (819) (7,345) Net balance as of March 31, 2021 $ 296,426 $ 30,020 $ 326,446 Accumulated amortization of intangible assets was $224.2 million and $216.9 million as of March 31, 2021 and December 31, 2020, respectively. The expected amortization of the intangible assets for each of the five succeeding years is $29.4 million. Goodwill During the first quarter of 2020 certain potential impairment indicators were identified, specifically (i) the decline in the market price of our common units, (ii) the decline in global commodity prices and (iii) the COVID-19 pandemic; which together indicated the fair value of the reporting unit was less than its carrying amount as of March 31, 2020. We performed a quantitative goodwill impairment test as of March 31, 2020 and determined fair value using a weighted combination of the income approach and the market approach. Determining fair value of a reporting unit requires judgment and use of significant estimates and assumptions. Such estimates and assumptions include revenue growth rates, EBITDA margins, weighted average costs of capital and future market conditions, among others. We believe the estimates and assumptions used were reasonable and based on available market information, but variations in any of the assumptions could have resulted in materially different calculations of fair value and determinations of whether or not an impairment is indicated. Under the income approach, we determined fair value based on estimated future cash flows, including estimates for capital expenditures, discounted to present value using the risk-adjusted industry rate, which reflects the overall level of inherent risk of the Partnership. Cash flow projections were derived from four-year operating forecasts plus an estimate of later period cash flows, all of which were developed by management. Subsequent period cash flows were developed using growth rates that management believed were reasonably likely to occur. Under the market approach, we determined fair value by applying valuation multiples of comparable publicly-traded companies to the projected EBITDA of the Partnership and then averaging that estimate with similar historical calculations using a three-year average. In addition, we estimated a reasonable control premium representing the incremental value that would accrue to us if we were to be acquired. Based on the quantitative goodwill impairment test described above, our carrying amount exceeded fair value and as a result, we recognized a goodwill impairment of $619.4 million for the three months ended March 31, 2020. |
Other Current Liabilities
Other Current Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities, Current [Abstract] | |
Other Current Liabilities | Other Current Liabilities Components of other current liabilities included the following (in thousands): March 31, December 31, Accrued sales tax contingencies (1) $ 44,923 $ 44,923 Accrued interest expense 5,839 31,125 Accrued payroll and benefits 7,361 8,416 Accrued unit-based compensation liability 11,529 9,183 ______________________ (1) Refer to Note 13 for further information on the accrued sales tax contingencies. |
Lease Accounting
Lease Accounting | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Lease Accounting | Lease Accounting Lessor Accounting We granted a bargain purchase option to a customer with respect to certain compressor packages leased to the customer. The bargain purchase option provides the customer with an option to acquire the equipment at a value significantly less than the fair market value at the end of the lease term in 2021. We accounted for this option as a sales-type lease resulting in a current installment receivable included in other accounts receivable of $1.9 million and $2.9 million as of March 31, 2021 and December 31, 2020, respectively. As of March 31, 2021, there is no allowance for credit losses on our net investment in the sales-type lease based on our collections experience with the customer. Revenue and interest income related to the lease is recognized over the lease term. We recognize maintenance revenue within contract operations revenue and interest income within interest expense, net. Maintenance revenue and interest income were as follows (in thousands): Three Months Ended March 31, 2021 2020 Maintenance revenue $ 323 $ 323 Interest income 48 124 Lease payments expected to be received subsequent to March 31, 2021 are as follows (in thousands): Lease Payments Total installment receivables (1) 1,938 Less: present value discount (60) Present value of installment receivables $ 1,878 ______________________ (1) As discussed above, the installment receivable lease term ends in 2021. |
Long-term Debt
Long-term Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term Debt Our long-term debt, of which there is no current portion, consisted of the following (in thousands): March 31, December 31, Senior Notes 2026, aggregate principal $ 725,000 $ 725,000 Senior Notes 2027, aggregate principal 750,000 750,000 Less: deferred financing costs, net of amortization (20,937) (21,805) Total senior notes, net 1,454,063 1,453,195 Revolving credit facility 502,688 473,810 Total long-term debt, net $ 1,956,751 $ 1,927,005 Revolving Credit Facility As of March 31, 2021, we were in compliance with all of our covenants under the Credit Agreement. The Credit Agreement has an aggregate commitment of $1.6 billion (subject to availability under our borrowing base), with a further potential increase of $400 million, and has a maturity date of April 2, 2023, which we expect to maintain for the term. As of March 31, 2021, we had outstanding borrowings under the Credit Agreement of $502.7 million, $1.1 billion of borrowing base availability and, subject to compliance with the applicable financial covenants, available borrowing capacity of $203.9 million. Our weighted average interest rate in effect for all borrowings under the Credit Agreement as of March 31, 2021 was 3.20%, with a weighted average interest rate of 3.06% for the three months ended March 31, 2021. There were no letters of credit issued as of March 31, 2021. We pay a commitment fee of 0.375% on the unused portion of the Credit Agreement. The Credit Agreement was amended on August 3, 2020 (the “Amendment Effective Date”) to amend, among other things, the requirements of certain covenants and the date on which certain covenants in the Credit Agreement must be met beginning on the Amendment Effective Date until the last day of the fiscal quarter ending December 31, 2021 (the “Covenant Relief Period”). The Credit Agreement permits us to make distributions of available cash to unitholders so long as (i) no default under the facility has occurred, is continuing or would result from the distribution, (ii) immediately prior to and after giving effect to such distribution, we are in compliance with the facility’s financial covenants and (iii) immediately prior to and after giving effect to such distribution, we have availability under the Credit Agreement of at least $250 million (reverting to $100 million after the Covenant Relief Period). The Credit Agreement also contains various financial covenants, including covenants requiring us to maintain: • a minimum EBITDA to interest coverage ratio of 2.5 to 1.0, determined as of the last day of each fiscal quarter, for the annualized trailing three months; and • a maximum funded debt to EBITDA ratio, determined as of the last day of each fiscal quarter, for the annualized trailing three months of (i) 5.50 to 1.00 for the fiscal quarters ending March 31, 2021 and June 30, 2021 and (ii) 5.25 to 1.00 for the fiscal quarters ending September 30, 2021 and December 31, 2021 (reverting to 5.00 to 1.00 after the Covenant Relief Period). In addition, the amendment provides that the 0.50 increase in maximum funded debt to EBITDA ratio applicable to certain future acquisitions (for the six In addition, during the Covenant Relief Period, the applicable margin for Eurodollar borrowings is increased from a range of 2.00% – 2.75% to a range of 2.25% – 3.00%. The amendment further provides that the Partnership becomes guarantor of the secured obligations of all other guarantors under the Credit Agreement. The Credit Agreement is a “revolving credit facility” that includes a lock box arrangement, whereby remittances from customers are forwarded to a bank account controlled by the administrative agent and are applied to reduce borrowings under the facility. Senior Notes 2026 On March 23, 2018, the Partnership and its wholly owned finance subsidiary, USA Compression Finance Corp. (“Finance Corp”), co-issued the Senior Notes 2026. The Senior Notes 2026 mature on April 1, 2026 and accrue interest at the rate of 6.875% per year. Interest on the Senior Notes 2026 is payable semi-annually in arrears on each of April 1 and October 1. The indenture governing the Senior Notes 2026 (the “2026 Indenture”) contains certain financial ratios that we must comply with in order to make certain restricted payments as described in the 2026 Indenture. As of March 31, 2021, we were in compliance with such financial covenants under the 2026 Indenture. The Senior Notes 2026 are fully and unconditionally guaranteed (the “2026 Guarantees”), jointly and severally, on a senior unsecured basis by all of our existing subsidiaries (other than Finance Corp), and will be fully and unconditionally guaranteed, jointly and severally, by each of our future restricted subsidiaries that either borrows under, or guarantees, the Credit Agreement or guarantees certain of our other indebtedness (collectively, the “Guarantors”). The Senior Notes 2026 and the 2026 Guarantees are general unsecured obligations and rank equally in right of payment with all of the Guarantors’, Finance Corp’s, and our existing and future senior indebtedness and senior to the Guarantors’, Finance Corp’s, and our future subordinated indebtedness, if any. The Senior Notes 2026 and the 2026 Guarantees are effectively subordinated in right of payment to all of the Guarantors’, Finance Corp’s, and our existing and future secured debt, including debt under the Credit Agreement and guarantees thereof, to the extent of the value of the assets securing such debt, and are structurally subordinated to all indebtedness of any of our subsidiaries that do not guarantee the Senior Notes 2026. Senior Notes 2027 On March 7, 2019, the Partnership and Finance Corp co-issued the Senior Notes 2027. The Senior Notes 2027 mature on September 1, 2027 and accrue interest at the rate of 6.875% per year. Interest on the Senior Notes 2027 is payable semi-annually in arrears on each of March 1 and September 1. The indenture governing the Senior Notes 2027 (the “2027 Indenture”) contains certain financial ratios that we must comply with in order to make certain restricted payments as described in the 2027 Indenture. As of March 31, 2021, we were in compliance with such financial covenants under the 2027 Indenture. The Senior Notes 2027 are fully and unconditionally guaranteed (the “2027 Guarantees”), jointly and severally, on a senior unsecured basis by the Guarantors. The Senior Notes 2027 and the 2027 Guarantees are general unsecured obligations and rank equally in right of payment with all of the Guarantors’, Finance Corp’s, and our existing and future senior indebtedness and senior to the Guarantors’, Finance Corp’s, and our future subordinated indebtedness, if any. The Senior Notes 2027 and the 2027 Guarantees are effectively subordinated in right of payment to all of the Guarantors’, Finance Corp’s, and our existing and future secured debt, including debt under the Credit Agreement and guarantees thereof, to the extent of the value of the assets securing such debt, and are structurally subordinated to all indebtedness of any of our subsidiaries that do not guarantee the Senior Notes 2027. We have no assets or operations independent of our subsidiaries, and there are no significant restrictions upon our ability to obtain funds from our subsidiaries by dividend or loan. Each of the Guarantors is 100% owned by us. None of the assets of our subsidiaries represent restricted net assets pursuant to Rule 4-08(e)(3) of Regulation S-X under the Securities Act. |
Preferred Units
Preferred Units | 3 Months Ended |
Mar. 31, 2021 | |
Preferred Units and Warrants | |
Preferred Units | Preferred Units We had 500,000 Preferred Units outstanding as of March 31, 2021 and December 31, 2020, respectively, with a face value of $1,000 per Preferred Unit. The Preferred Units rank senior to the common units with respect to distributions and rights upon liquidation. The holders of the Preferred Units are entitled to receive cumulative quarterly cash distributions equal to $24.375 per Preferred Unit. We have declared and paid quarterly cash distributions to the holders of the Preferred Units of record as follows: Payment Date Distribution per Preferred Unit February 7, 2020 $ 24.375 May 8, 2020 24.375 August 10, 2020 24.375 November 6, 2020 24.375 2020 total distributions $ 97.500 February 5, 2021 $ 24.375 Announced Quarterly Distribution On April 14, 2021, we declared a cash distribution of $24.375 per unit on the Preferred Units. The distribution will be paid on May 7, 2021 to the holders of the Preferred Units of record as of close of business on April 26, 2021. Changes in the Preferred Units balance are as follows (in thousands): Preferred Units Balance as of December 31, 2020 $ 477,309 Net income allocated to Preferred Units 12,187 Cash distributions on Preferred Units (12,187) Balance as of March 31, 2021 $ 477,309 Redemption and Conversion Features |
Partners' Capital
Partners' Capital | 3 Months Ended |
Mar. 31, 2021 | |
Partners' Capital Notes [Abstract] | |
Partners' Capital | Partners’ Capital Common Units The change in common units outstanding was as follows: Units Outstanding Number of units outstanding as of December 31, 2020 96,962,323 Vesting of phantom units 25,986 Issuance of common units under the DRIP 33,981 Number of units outstanding as of March 31, 2021 97,022,290 As of March 31, 2021, ETO held 46,056,228 common units, including 8,000,000 common units held by the General Partner and controlled by ETO. Cash Distributions We have declared and paid quarterly distributions per unit to our limited partner unitholders of record, including holders of our common units and phantom units, as follows (dollars in millions, except distribution per unit): Payment Date Distribution per Limited Partner Unit Amount Paid to Common Unitholders Amount Paid to Phantom Unitholders Total Distribution February 7, 2020 $ 0.525 $ 50.7 $ 0.9 $ 51.6 May 8, 2020 0.525 50.8 0.9 51.7 August 10, 2020 0.525 50.9 0.8 51.7 November 6, 2020 0.525 50.9 0.7 51.6 2020 total distributions $ 2.10 $ 203.3 $ 3.3 $ 206.6 February 5, 2021 $ 0.525 $ 50.9 $ 1.1 $ 52.0 Announced Quarterly Distribution On April 14, 2021, we announced a cash distribution of $0.525 per unit on our common units. The distribution will be paid on May 7, 2021 to common unitholders of record as of the close of business on April 26, 2021. DRIP During the three months ended March 31, 2021, distributions of $0.5 million were reinvested under the DRIP resulting in the issuance of 33,981 common units. Warrants As of March 31, 2021 and December 31, 2020, we had two tranches of warrants outstanding, which includes warrants to purchase (i) 5,000,000 common units with a strike price of $17.03 per common unit and (ii) 10,000,000 common units with a strike price of $19.59 per common unit (collectively, the “Warrants”). The Warrants may be exercised by the holders at any time before April 2, 2028. Loss per Unit The computation of loss per unit is based on the weighted average number of participating securities, which includes our common units and certain equity-based awards, outstanding during the applicable period. Basic loss per unit is determined by dividing net income (loss) allocated to participating securities after deducting the distributions on Preferred Units, by the weighted average number of participating securities outstanding during the period. Loss attributable to unitholders is allocated to participating securities based on their respective shares of the distributed and undistributed earnings for the period. To the extent cash distributions exceed net income (loss) attributable to unitholders for the period, the excess distributions are allocated to all participating securities outstanding based on their respective ownership percentages. Diluted loss per unit is computed using the treasury stock method, which considers the potential issuance of limited partner units associated with our long-term incentive plan and Warrants. Unvested phantom units and unexercised Warrants are not included in basic loss per unit, as they are not considered to be participating securities, but are included in the calculation of diluted loss per unit to the extent they are dilutive, and in the case of Warrants to the extent they are considered “in the money.” For the three months ended March 31, 2021 and 2020, approximately 710,000 and 489,000 incremental unvested phantom units, respectively, were excluded from the calculation of diluted loss per unit because the impact was anti-dilutive and our outstanding Warrants are not included in the computation as they are not considered “in the money” for either period. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of Revenue The following table disaggregates our revenue by type of service (in thousands): Three Months Ended March 31, 2021 2020 Contract operations revenue $ 155,469 $ 175,902 Retail parts and services revenue 2,044 3,097 Total revenues $ 157,513 $ 178,999 The following table disaggregates our revenue by timing of provision of services or transfer of goods (in thousands): Three Months Ended March 31, 2021 2020 Services provided over time: Primary term $ 106,561 $ 120,362 Month-to-month 48,908 55,540 Total services provided over time 155,469 175,902 Services provided or goods transferred at a point in time 2,044 3,097 Total revenues $ 157,513 $ 178,999 Contract Assets We record contract assets when we have completed performance under a contract but our right to consideration is not yet unconditional. We had no contract assets as of March 31, 2021 and December 31, 2020. Deferred Revenue We record deferred revenue when cash payments are received or due in advance of our performance. Components of deferred revenue were as follows (in thousands): Balance sheet location March 31, December 31, Current (1) Deferred revenue $ 48,792 $ 47,202 Noncurrent Other liabilities 8,570 8,200 Total $ 57,362 $ 55,402 ______________________ (1) We recognized $39.3 million of revenue during the three months ended March 31, 2021 related to our deferred revenue balance as of December 31, 2020. Performance Obligations As of March 31, 2021, we had unsatisfied performance obligations related to our contract operations revenue of $467.4 million. We expect to recognize these remaining performance obligations as follows (in thousands): 2021 (remainder) 2022 2023 2024 Thereafter Total Remaining performance obligations $ 229,340 $ 144,444 $ 61,819 $ 24,907 $ 6,894 $ 467,404 |
Transactions with Related Parti
Transactions with Related Parties | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | Transactions with Related Parties We provide compression services to entities affiliated with ETO, which as of March 31, 2021 owned approximately 47% of our limited partner interests and 100% of the General Partner. Revenue recognized from such affiliated ETO entities on our unaudited condensed consolidated statements of operations were as follows (in thousands): Three Months Ended March 31, 2021 2020 Related party revenues $ 2,950 $ 3,157 We had $0 and $120,000 within related party receivables and $6,000 and $0 within accounts payable on our unaudited condensed consolidated balance sheets as of March 31, 2021 and December 31, 2020, respectively, from such affiliated ETO entities. Additionally, the Partnership had a $44.9 million related party receivable from ETO as of March 31, 2021 and December 31, 2020 related to indemnification for sales tax contingencies. See Note 13 for more information related to such sales tax contingencies. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies (a) Major Customers We did not have revenue from any single customer representing 10% or more of total revenue for the three months ended March 31, 2021 or 2020. (b) Litigation From time to time, we and our subsidiaries may be involved in various claims and litigation arising in the ordinary course of business. In management’s opinion, the resolution of such matters is not expected to have a material adverse effect on our consolidated financial position, results of operations or cash flows. (c) Sales Tax Contingencies Our compliance with state and local sales tax regulations is subject to audit by various taxing authorities. Certain taxing authorities have either claimed or issued an assessment that specific operational processes, which we and others in our industry regularly conduct, result in transactions that are subject to state sales taxes. We and others in our industry have disputed these claims and assessments based on either existing tax statutes or published guidance by the taxing authorities. We are currently in discussions with the Oklahoma Tax Commission (“OTC”) regarding its assessment. We believe it is reasonably possible that we could incur losses related to this assessment depending on whether the OTC accepts our position that the transactions are not taxable and we ultimately lose any and all subsequent legal challenges to such determination by the OTC. We estimate that the range of losses we could incur is from $0 to approximately $21.6 million, including penalty and interest. The upper end of this range assumes that all compression services in Oklahoma are taxable, which we believe is remote. As of March 31, 2021 and December 31, 2020, we have recorded a $44.9 million accrued liability and $44.9 million related party receivable from ETO related to open audits with the Office of the Texas Comptroller of Public Accounts. For more information, see Note 17 to the consolidated financial statements included in our 2020 Annual Report. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2020-04, Reference Rate Reform (“Topic 848”): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendment to Topic 848 provides relief from certain contract modification accounting requirements for the transition away from the London Interbank Offered Rate and certain other reference rates. Adoption of the amendments in this update are optional, effective upon issuance and may be adopted during any interim or annual period through December 31, 2022. Modifications to our Credit Agreement during the effective period of this amendment will be assessed and if the modifications meet the criteria for the optional expedients and exceptions, we intend to adopt Topic 848 and apply the amendments as applicable. In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 changes how entities account for convertible instruments and contracts in an entity’s own equity, as well as updates guidance on earnings per unit and other related disclosures. The amendments in this update are effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020. We plan to adopt this new standard on January 1, 2022. We expect the impact on our disclosures will not be material and there to be no impact to our consolidated financial statements. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates Our unaudited condensed consolidated financial statements have been prepared in conformity with GAAP, which includes the use of estimates and assumptions by management that affect the reported amounts of assets, liabilities, revenues, expenses and disclosure of contingent assets and liabilities that existed at the date of the unaudited condensed consolidated financial statements. Although these estimates were based on management’s available knowledge of current and expected future events, actual results could differ from these estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of all cash balances. We consider investments in highly liquid financial instruments purchased with an original maturity of 90 days or less to be cash equivalents. |
Trade Accounts Receivable | Trade Accounts Receivable Trade accounts receivable are recorded at the invoiced amount. |
Allowance for Credit Losses | Allowance for Credit Losses We evaluate our allowance for credit losses related to our two financial assets measured at amortized cost: (i) trade accounts receivable and (ii) net investment in lease related to our sales-type lease discussed further in Note 7. Due to the short- term nature of our trade accounts receivable, we consider the amortized cost to be the same as the carrying amount of the receivable, excluding the allowance for credit losses. Our determination of the allowance for credit losses requires us to make estimates and judgments regarding our customers’ ability to pay amounts due and is the same process for both of our financial assets as they have similar risk characteristics. We continuously evaluate the financial strength of our customers and the overall business climate in which our customers operate and make adjustments to the allowance for credit losses as necessary. We evaluate the financial strength of our customers by reviewing the aging of their receivables, our collection experience with the customer, correspondence, financial information and third-party credit ratings. We evaluate the business climate in which our customers operate by reviewing various publicly available materials regarding our customers’ industry, including the solvency of various companies in the industry. |
Inventories | Inventories Inventories consist of serialized and non-serialized parts used primarily on compression units. All inventories are stated at the lower of cost or net realizable value. Serialized parts inventories are determined using the specific identification cost method, while non-serialized parts inventories are determined using the weighted average cost method. Purchases of inventories are considered operating activities on the unaudited condensed consolidated statements of cash flows. |
Property and Equipment | Property and Equipment Property and equipment are carried at cost except for (i) certain acquired assets which are recorded at fair value on their respective acquisition dates and (ii) impaired assets which are recorded at fair value on the last impairment evaluation date for which an adjustment was required. Overhauls and major improvements that increase the value or extend the life of compression equipment are capitalized and depreciated over three When property and equipment is retired or sold, its carrying value and the related accumulated depreciation are removed from our accounts and any associated gains or losses are recorded on the unaudited condensed consolidated statements of operations in the period of sale or disposition. Capitalized interest is calculated by multiplying our monthly effective interest rate on outstanding debt by the amount of qualifying costs, which include upfront payments to acquire certain compression units. Capitalized interest was $3,000 and $142,000 for the three months ended March 31, 2021 and 2020, respectively. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets with recorded values that are not expected to be recovered through future cash flows are written-down to estimated fair value. We test long-lived assets for impairment when events or circumstances indicate that the assets’ carrying value may not be recoverable or will no longer be utilized in the operating fleet. The most common circumstance requiring compression units to be evaluated for impairment is when idle units do not meet the desired performance characteristics of our active revenue generating horsepower. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value of the long-lived asset exceeds the sum of the undiscounted cash flows associated with the asset, an impairment loss equal to the amount of the carrying value exceeding the fair value of the asset is recognized. The fair value of the asset is measured using quoted market prices or, in the absence of quoted market prices, based on an estimate of discounted cash flows, the expected net sale proceeds compared to the other similarly configured fleet units we recently sold or a review of other units recently offered for sale by third parties, or the estimated component value of the equipment we plan to use. Refer to Note 5 for more detailed information about impairment charges during the three months ended March 31, 2021 and 2020. |
Identifiable Intangible Assets | Identifiable Intangible Assets Identifiable intangible assets are recorded at cost and amortized using the straight-line method over their estimated useful lives, which is the period over which the assets are expected to contribute directly or indirectly to our future cash flows. The estimated useful lives of our intangible assets range from 15 to 25 years. |
Revenue Recognition | Revenue Recognition Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of our services or goods. Revenue is measured at the amount of consideration we expect to receive in exchange for providing services or transferring goods. Incidental items, if any, that are immaterial in the context of the contract are recognized as expenses. |
Income Taxes | Income Taxes We are organized as a partnership for U.S. federal and state income tax purposes. As a result, our partners are responsible for U.S. federal and state income taxes based upon their distributive share of our items of income, gain, loss or deduction. Texas imposes an entity-level income tax on partnerships that is based on Texas sourced taxable margin (the “Texas Margin Tax”). We have included in the unaudited condensed consolidated financial statements a provision for the Texas Margin Tax. |
Pass Through Taxes | Pass Through Taxes Sales taxes incurred on behalf of, and passed through to, customers are accounted for on a net basis. |
Fair Value Measurements | Fair Value Measurements Accounting standards on fair value measurements establish a framework for measuring fair value and stipulate disclosures about fair value measurements. The standards apply to recurring and non-recurring financial and non-financial assets and liabilities that require or permit fair value measurements. Among the required disclosures is the fair value hierarchy of inputs we use to value an asset or a liability. The three levels of the fair value hierarchy are described as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access at the measurement date. Level 2 inputs are those other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. As of March 31, 2021, our financial instruments consisted primarily of cash and cash equivalents, trade accounts receivable, trade accounts payable and long-term debt. The book values of cash and cash equivalents, trade accounts receivable and trade accounts payable are representative of fair value due to their short-term maturities. The carrying amount of our revolving credit facility approximates fair value due to the floating interest rates associated with the debt. The fair value of our Senior Notes 2026 and Senior Notes 2027 were estimated using quoted prices in inactive markets and are considered Level 2 measurements. |
Operating Segment | Operating Segment We operate in a single business segment, the compression services business. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2020-04, Reference Rate Reform (“Topic 848”): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendment to Topic 848 provides relief from certain contract modification accounting requirements for the transition away from the London Interbank Offered Rate and certain other reference rates. Adoption of the amendments in this update are optional, effective upon issuance and may be adopted during any interim or annual period through December 31, 2022. Modifications to our Credit Agreement during the effective period of this amendment will be assessed and if the modifications meet the criteria for the optional expedients and exceptions, we intend to adopt Topic 848 and apply the amendments as applicable. In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 changes how entities account for convertible instruments and contracts in an entity’s own equity, as well as updates guidance on earnings per unit and other related disclosures. The amendments in this update are effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020. We plan to adopt this new standard on January 1, 2022. We expect the impact on our disclosures will not be material and there to be no impact to our consolidated financial statements. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of aggregate principal amount and fair value | The following table summarizes the aggregate principal amount and fair value of our Senior Notes 2026 and Senior Notes 2027 (in thousands): March 31, December 31, Senior Notes 2026, aggregate principal $ 725,000 $ 725,000 Fair value of Senior Notes 2026 743,125 761,250 Senior Notes 2027, aggregate principal 750,000 750,000 Fair value of Senior Notes 2027 776,250 800,625 |
Statement of Financial Position
Statement of Financial Position, Classified (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Statement of Financial Position [Abstract] | |
Summary of activity within trade account receivable allowance for credit losses | The following summarizes activity within our trade accounts receivable allowance for credit losses balance (in thousands): Allowance for Credit Losses Balance as of December 31, 2020 $ 4,982 Current-period provision for expected credit losses (1,250) Writeoffs charged against the allowance (191) Balance as of March 31, 2021 $ 3,541 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Summary of components of inventories | Components of inventories are as follows (in thousands): March 31, December 31, Serialized parts $ 42,448 $ 42,233 Non-serialized parts 42,292 42,399 Total inventories $ 84,740 $ 84,632 |
Property and Equipment, Ident_2
Property and Equipment, Identifiable Intangible Assets and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property and Equipment and Identifiable Intangible Assets | |
Schedule of property and equipment | Property and equipment consisted of the following (in thousands): March 31, December 31, Compression and treating equipment $ 3,482,751 $ 3,480,660 Computer equipment 53,981 53,887 Automobiles and vehicles 33,276 33,412 Leasehold improvements 8,238 8,218 Buildings 5,334 5,334 Furniture and fixtures 1,111 1,110 Land 77 77 Total property and equipment, gross 3,584,768 3,582,698 Less: accumulated depreciation and amortization (1,252,556) (1,202,065) Total property and equipment, net $ 2,332,212 $ 2,380,633 Depreciation expense on property and equipment and gain on disposition of assets were as follows (in thousands): Three Months Ended March 31, 2021 2020 Depreciation expense $ 53,685 $ 51,417 Gain on disposition of assets 1,255 1,014 |
Schedule of estimated useful lives of property, plant, and equipment | Depreciation is calculated using the straight-line method over the estimated useful lives of the assets as follows: Compression equipment, acquired new 25 years Compression equipment, acquired used 5 - 25 years Furniture and fixtures 3 - 10 years Vehicles and computer equipment 1 - 10 years Buildings 5 years Leasehold improvements 5 years |
Schedule of identifiable intangible assets | Identifiable intangible assets, net consisted of the following (in thousands): Customer Relationships Trade Names Total Net balance as of December 31, 2020 $ 302,952 $ 30,839 $ 333,791 Amortization expense (6,526) (819) (7,345) Net balance as of March 31, 2021 $ 296,426 $ 30,020 $ 326,446 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Components of other current liabilities | Components of other current liabilities included the following (in thousands): March 31, December 31, Accrued sales tax contingencies (1) $ 44,923 $ 44,923 Accrued interest expense 5,839 31,125 Accrued payroll and benefits 7,361 8,416 Accrued unit-based compensation liability 11,529 9,183 ______________________ |
Lease Accounting (Tables)
Lease Accounting (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Lease payments expected to be received | Maintenance revenue and interest income were as follows (in thousands): Three Months Ended March 31, 2021 2020 Maintenance revenue $ 323 $ 323 Interest income 48 124 Lease payments expected to be received subsequent to March 31, 2021 are as follows (in thousands): Lease Payments Total installment receivables (1) 1,938 Less: present value discount (60) Present value of installment receivables $ 1,878 ______________________ (1) As discussed above, the installment receivable lease term ends in 2021. |
Long-term Debt (Tables)
Long-term Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Our long-term debt, of which there is no current portion, consisted of the following (in thousands): March 31, December 31, Senior Notes 2026, aggregate principal $ 725,000 $ 725,000 Senior Notes 2027, aggregate principal 750,000 750,000 Less: deferred financing costs, net of amortization (20,937) (21,805) Total senior notes, net 1,454,063 1,453,195 Revolving credit facility 502,688 473,810 Total long-term debt, net $ 1,956,751 $ 1,927,005 |
Preferred Units (Tables)
Preferred Units (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Preferred Units and Warrants | |
Dividends Declared | We have declared and paid quarterly cash distributions to the holders of the Preferred Units of record as follows: Payment Date Distribution per Preferred Unit February 7, 2020 $ 24.375 May 8, 2020 24.375 August 10, 2020 24.375 November 6, 2020 24.375 2020 total distributions $ 97.500 February 5, 2021 $ 24.375 |
Changes in the Preferred Units balance | Changes in the Preferred Units balance are as follows (in thousands): Preferred Units Balance as of December 31, 2020 $ 477,309 Net income allocated to Preferred Units 12,187 Cash distributions on Preferred Units (12,187) Balance as of March 31, 2021 $ 477,309 |
Partners' Capital (Tables)
Partners' Capital (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Partners' Capital Notes [Abstract] | |
Summary of change in common units outstanding | The change in common units outstanding was as follows: Units Outstanding Number of units outstanding as of December 31, 2020 96,962,323 Vesting of phantom units 25,986 Issuance of common units under the DRIP 33,981 Number of units outstanding as of March 31, 2021 97,022,290 |
Schedule of distributions (in millions, except distribution per unit) | We have declared and paid quarterly distributions per unit to our limited partner unitholders of record, including holders of our common units and phantom units, as follows (dollars in millions, except distribution per unit): Payment Date Distribution per Limited Partner Unit Amount Paid to Common Unitholders Amount Paid to Phantom Unitholders Total Distribution February 7, 2020 $ 0.525 $ 50.7 $ 0.9 $ 51.6 May 8, 2020 0.525 50.8 0.9 51.7 August 10, 2020 0.525 50.9 0.8 51.7 November 6, 2020 0.525 50.9 0.7 51.6 2020 total distributions $ 2.10 $ 203.3 $ 3.3 $ 206.6 February 5, 2021 $ 0.525 $ 50.9 $ 1.1 $ 52.0 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The following table disaggregates our revenue by type of service (in thousands): Three Months Ended March 31, 2021 2020 Contract operations revenue $ 155,469 $ 175,902 Retail parts and services revenue 2,044 3,097 Total revenues $ 157,513 $ 178,999 The following table disaggregates our revenue by timing of provision of services or transfer of goods (in thousands): Three Months Ended March 31, 2021 2020 Services provided over time: Primary term $ 106,561 $ 120,362 Month-to-month 48,908 55,540 Total services provided over time 155,469 175,902 Services provided or goods transferred at a point in time 2,044 3,097 Total revenues $ 157,513 $ 178,999 |
Summary of deferred revenue | We record deferred revenue when cash payments are received or due in advance of our performance. Components of deferred revenue were as follows (in thousands): Balance sheet location March 31, December 31, Current (1) Deferred revenue $ 48,792 $ 47,202 Noncurrent Other liabilities 8,570 8,200 Total $ 57,362 $ 55,402 ______________________ (1) We recognized $39.3 million of revenue during the three months ended March 31, 2021 related to our deferred revenue balance as of December 31, 2020. |
Expected timing of recognizing remaining performance obligations | We expect to recognize these remaining performance obligations as follows (in thousands): 2021 (remainder) 2022 2023 2024 Thereafter Total Remaining performance obligations $ 229,340 $ 144,444 $ 61,819 $ 24,907 $ 6,894 $ 467,404 |
Related Party Disclosures (Tabl
Related Party Disclosures (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Summary of Revenue Recognized from such Affiliated ETO Entities | Revenue recognized from such affiliated ETO entities on our unaudited condensed consolidated statements of operations were as follows (in thousands): Three Months Ended March 31, 2021 2020 Related party revenues $ 2,950 $ 3,157 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Property and Equipment, Intangible Assets, and Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property and Equipment | ||
Capitalized interest | $ 3 | $ 142 |
Impairment of goodwill | $ 0 | $ 619,411 |
Minimum | ||
Property and Equipment | ||
Amortization period of identifiable intangible assets | 15 years | |
Maximum | ||
Property and Equipment | ||
Amortization period of identifiable intangible assets | 25 years | |
Compression equipment overhauls | Minimum | ||
Property and Equipment | ||
Estimated useful lives | 3 years | |
Compression equipment overhauls | Maximum | ||
Property and Equipment | ||
Estimated useful lives | 5 years |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Senior Notes 2026 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Aggregate principal | $ 725,000 | $ 725,000 |
Fair value | 743,125 | 761,250 |
Senior Notes 2027 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Aggregate principal | 750,000 | 750,000 |
Fair value | $ 776,250 | $ 800,625 |
Trade Accounts Receivable - Nar
Trade Accounts Receivable - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Receivables [Abstract] | |||
Allowance for credit losses | $ 3,541 | $ 4,982 | |
Expense (reversal) of provision | (1,250) | $ 1,500 | |
Current-period provision for expected credit losses | $ (1,250) | $ 1,500 |
Trade Accounts Receivable - Sum
Trade Accounts Receivable - Summary of Allowance for Credit Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | $ 4,982 | |
Current-period provision for expected credit losses | (1,250) | $ 1,500 |
Writeoffs charged against the allowance | (191) | |
Balance at ending of period | $ 3,541 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Serialized parts | $ 42,448 | $ 42,233 |
Non-serialized parts | 42,292 | 42,399 |
Total inventories | $ 84,740 | $ 84,632 |
Property and Equipment, Ident_3
Property and Equipment, Identifiable Intangible Assets and Goodwill - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property and Equipment | ||
Total property and equipment, gross | $ 3,584,768 | $ 3,582,698 |
Less: accumulated depreciation and amortization | (1,252,556) | (1,202,065) |
Total property and equipment, net | 2,332,212 | 2,380,633 |
Compression and treating equipment | ||
Property and Equipment | ||
Total property and equipment, gross | 3,482,751 | 3,480,660 |
Computer equipment | ||
Property and Equipment | ||
Total property and equipment, gross | 53,981 | 53,887 |
Automobiles and vehicles | ||
Property and Equipment | ||
Total property and equipment, gross | 33,276 | 33,412 |
Leasehold improvements | ||
Property and Equipment | ||
Total property and equipment, gross | 8,238 | 8,218 |
Buildings | ||
Property and Equipment | ||
Total property and equipment, gross | 5,334 | 5,334 |
Furniture and fixtures | ||
Property and Equipment | ||
Total property and equipment, gross | 1,111 | 1,110 |
Land | ||
Property and Equipment | ||
Total property and equipment, gross | $ 77 | $ 77 |
Property and Equipment, Ident_4
Property and Equipment, Identifiable Intangible Assets and Goodwill - Property, Plant and Equipment Useful Lives (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Compression equipment, acquired new | |
Property and Equipment | |
Estimated useful lives | 25 years |
Buildings | |
Property and Equipment | |
Estimated useful lives | 5 years |
Leasehold improvements | |
Property and Equipment | |
Estimated useful lives | 5 years |
Minimum | Compression equipment, acquired used | |
Property and Equipment | |
Estimated useful lives | 5 years |
Minimum | Furniture and fixtures | |
Property and Equipment | |
Estimated useful lives | 3 years |
Minimum | Vehicles and computer equipment | |
Property and Equipment | |
Estimated useful lives | 1 year |
Maximum | Compression equipment, acquired used | |
Property and Equipment | |
Estimated useful lives | 25 years |
Maximum | Furniture and fixtures | |
Property and Equipment | |
Estimated useful lives | 10 years |
Maximum | Vehicles and computer equipment | |
Property and Equipment | |
Estimated useful lives | 10 years |
Property and Equipment, Ident_5
Property and Equipment, Identifiable Intangible Assets and Goodwill - Depreciation and Loss (Gain) on Disposition (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property and Equipment and Identifiable Intangible Assets | ||
Depreciation expense | $ 53,685 | $ 51,417 |
Gain on disposition of assets | $ 1,255 | $ 1,014 |
Property and Equipment, Ident_6
Property and Equipment, Identifiable Intangible Assets and Goodwill - Narrative (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021USD ($)equipmenthp | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Property and Equipment | |||
Number of compressor units that are to be retired | equipment | 12 | ||
Number of horsepower that are to be retired | hp | 5,600 | ||
Impairment of long-lived assets | $ 2,550,000 | $ 0 | |
Accumulated amortization | 224,200,000 | $ 216,900,000 | |
Expected amortization of intangible assets, year one | 29,400,000 | ||
Expected amortization of intangible assets, year two | 29,400,000 | ||
Expected amortization of intangible assets, year three | 29,400,000 | ||
Expected amortization of intangible assets, year four | 29,400,000 | ||
Expected amortization of intangible assets, year five | 29,400,000 | ||
Impairment of goodwill | 0 | $ 619,411,000 | |
Accounts payable and accrued liabilities | |||
Property and Equipment | |||
Purchases of property and equipment | $ 2,000,000 | $ 2,800,000 |
Property and Equipment, Ident_7
Property and Equipment, Identifiable Intangible Assets and Goodwill - Identifiable Intangible Assets (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Identifiable intangible assets, net | |
Net balance, beginning of period | $ 333,791 |
Amortization expense | (7,345) |
Net balance, end of period | 326,446 |
Customer Relationships | |
Identifiable intangible assets, net | |
Net balance, beginning of period | 302,952 |
Amortization expense | (6,526) |
Net balance, end of period | 296,426 |
Trade Names | |
Identifiable intangible assets, net | |
Net balance, beginning of period | 30,839 |
Amortization expense | (819) |
Net balance, end of period | $ 30,020 |
Other Current Liabilities (Deta
Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities, Current [Abstract] | ||
Accrued sales tax contingencies | $ 44,923 | $ 44,923 |
Accrued interest expense | 5,839 | 31,125 |
Accrued payroll and benefits | 7,361 | 8,416 |
Accrued unit-based compensation liability | $ 11,529 | $ 9,183 |
Lease Accounting - Narrative (D
Lease Accounting - Narrative (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Lessee, Lease, Description [Line Items] | ||
Allowance for credit losses on net investment in the sales-type lease | $ 0 | |
Sales type lease | ||
Lessee, Lease, Description [Line Items] | ||
Installment receivable, current | $ 1,900,000 | $ 2,900,000 |
Lease Accounting - Lessor Accou
Lease Accounting - Lessor Accounting (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Lessor, Lease, Description [Line Items] | ||
Maintenance revenue | $ 157,513 | $ 178,999 |
Total installment receivables | 1,938 | |
Less: present value discount | (60) | |
Present value of installment receivables | 1,878 | |
Sales type lease | ||
Lessor, Lease, Description [Line Items] | ||
Maintenance revenue | 323 | 323 |
Interest income | $ 48 | $ 124 |
Long-term Debt - Summary of Deb
Long-term Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Less: deferred financing costs, net of amortization | $ (20,937) | $ (21,805) |
Total long-term debt, net | 1,956,751 | 1,927,005 |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt, net | 1,454,063 | 1,453,195 |
Senior Notes 2026 | ||
Debt Instrument [Line Items] | ||
Long-term debt, aggregate principal | 725,000 | 725,000 |
Senior Notes 2027 | ||
Debt Instrument [Line Items] | ||
Long-term debt, aggregate principal | 750,000 | 750,000 |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Total long-term debt, net | $ 502,688 | $ 473,810 |
Long-term Debt - Narrative (Det
Long-term Debt - Narrative (Details) | Aug. 02, 2020 | Mar. 31, 2021USD ($) | Sep. 30, 2021 | Dec. 31, 2021 | Jan. 01, 2022USD ($) | Jul. 01, 2021 | Apr. 01, 2021 | Jan. 01, 2021 | Aug. 03, 2020USD ($) |
USA Compression Partners, LP | |||||||||
Long-term Debt | |||||||||
Ownership interest in guarantors (as a percent) | 100.00% | ||||||||
Revolving credit facility | |||||||||
Long-term Debt | |||||||||
Maximum borrowing capacity | $ 1,600,000,000 | ||||||||
Amount of further potential increase in maximum capacity | 400,000,000 | ||||||||
Outstanding borrowings | 502,700,000 | ||||||||
Borrowing base availability | 1,100,000,000 | ||||||||
Borrowing capacity, subject to covenants | $ 203,900,000 | ||||||||
Effective interest rate (as a percent) | 3.20% | ||||||||
Weighted average interest rate (as a percent) | 3.06% | ||||||||
Letters of credit | $ 0 | ||||||||
Commitment fee percentage | 0.375% | ||||||||
Capacity available for repayment of debt | $ 250,000,000 | ||||||||
Minimum EBITDA to interest coverage ratio | 2.5 | ||||||||
Maximum funded debt to EBITDA ratio | 5.50 | ||||||||
Revolving credit facility | Minimum | Eurodollar | |||||||||
Long-term Debt | |||||||||
Margin for Eurodollar borrowings (in percentage) | 2.00% | ||||||||
Revolving credit facility | Maximum | Eurodollar | |||||||||
Long-term Debt | |||||||||
Margin for Eurodollar borrowings (in percentage) | 2.75% | ||||||||
Revolving credit facility | Forecast | |||||||||
Long-term Debt | |||||||||
Capacity available for repayment of debt | $ 100,000,000 | ||||||||
Maximum funded debt to EBITDA ratio | 5 | 5.25 | 5.50 | ||||||
Increase in maximum funded debt to EBITDA ratio in connection with certain future acquisitions | 0.50 | ||||||||
Consecutive period following the period in which any acquisition occurs for maintaining increased maximum funded debt to EBITDA ratio | 6 months | ||||||||
Revolving credit facility | Forecast | Minimum | Eurodollar | |||||||||
Long-term Debt | |||||||||
Margin for Eurodollar borrowings (in percentage) | 2.25% | ||||||||
Revolving credit facility | Forecast | Maximum | Eurodollar | |||||||||
Long-term Debt | |||||||||
Margin for Eurodollar borrowings (in percentage) | 3.00% | ||||||||
Senior Notes 2026 | |||||||||
Long-term Debt | |||||||||
Effective interest rate (as a percent) | 6.875% | ||||||||
Senior Notes 2027 | |||||||||
Long-term Debt | |||||||||
Effective interest rate (as a percent) | 6.875% |
Preferred Units - Narrative (De
Preferred Units - Narrative (Details) - $ / shares | Apr. 14, 2021 | Feb. 05, 2021 | Nov. 06, 2020 | Aug. 10, 2020 | May 08, 2020 | Feb. 07, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Apr. 02, 2023 | Apr. 02, 2022 | Apr. 02, 2021 |
Preferred stock, dividend paid per share (in dollars per share) | $ 24.375 | $ 24.375 | $ 24.375 | $ 24.375 | $ 24.375 | $ 97.500 | |||||
Forecast | |||||||||||
Preferred unit, percent of amount eligible for conversion | 100.00% | 66.70% | |||||||||
Subsequent Event | |||||||||||
Preferred stock, dividend declared per share (in dollars per share) | $ 24.375 | ||||||||||
Preferred unit, percent of amount eligible for conversion | 33.30% | ||||||||||
Series A Preferred Units | |||||||||||
Units issued (in shares) | 500,000 | 500,000 | |||||||||
Face value (in dollars per share) | $ 1,000 | $ 1,000 | |||||||||
Distribution per unit (in dollars per share) | 24.375 | ||||||||||
Conversion rate numerator value plus unpaid cash distributions on the applicable preferred unit | 1,000 | ||||||||||
Conversion rate denominator for each Preferred Unit | $ 20.0115 | ||||||||||
Preferred units, if redeemed, electable to be paid in common units (as a percent) | 50.00% |
Preferred Units - Summary of Ch
Preferred Units - Summary of Changes in Preferred Units (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Beginning balance | $ 477,309 | |
Cash distributions on Preferred Units | (12,187) | $ (12,187) |
Ending balance | 477,309 | |
Series A Preferred Units | ||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Beginning balance | 477,309 | |
Net income allocated to Preferred Units | 12,187 | |
Cash distributions on Preferred Units | (12,187) | |
Ending balance | $ 477,309 |
Partners' Capital - Change in C
Partners' Capital - Change in Common Units Outstanding (Details) | 3 Months Ended |
Mar. 31, 2021shares | |
Increase (Decrease) in Partners' Capital | |
Beginning balance (in shares) | 96,962,323 |
Vesting of phantom units (in shares) | 25,986 |
Issuance of common units under the DRIP (in shares) | 33,981 |
Ending balance (in shares) | 97,022,290 |
Partners' Capital - Narrative (
Partners' Capital - Narrative (Details) $ / shares in Units, $ in Millions | Apr. 14, 2021$ / shares | Mar. 31, 2021USD ($)tranche$ / sharesshares | Dec. 31, 2020tranche$ / sharesshares |
Partners' Capital | |||
Partners' capital (in units) | 97,022,290 | 96,962,323 | |
Tranche 1 | |||
Partners' Capital | |||
Number of shares that can be purchased on the warrant | 5,000,000 | 5,000,000 | |
Warrant strike price (in dollars per share) | $ / shares | $ 17.03 | $ 17.03 | |
Tranche 2 | |||
Partners' Capital | |||
Number of shares that can be purchased on the warrant | 10,000,000 | 10,000,000 | |
Warrant strike price (in dollars per share) | $ / shares | $ 19.59 | $ 19.59 | |
EIG | |||
Partners' Capital | |||
Number of tranches of warrants | tranche | 2 | 2 | |
Distribution reinvestment plan ("DRIP") | |||
Partners' Capital | |||
Common units issued (in shares) | 33,981 | ||
Limited partner | Common units | Cash Distributions | Subsequent Event | |||
Partners' Capital | |||
Cash distribution announced per unit (in dollars per share) | $ / shares | $ 0.525 | ||
Limited partner | Common units | Distribution reinvestment plan ("DRIP") | |||
Partners' Capital | |||
Non-cash distributions | $ | $ 0.5 | ||
Limited partner | Common units | ETO | |||
Partners' Capital | |||
Partners' capital (in units) | 46,056,228 | ||
General partner | Common units | ETO | |||
Partners' Capital | |||
Partners' capital (in units) | 8,000,000 |
Partners' Capital - Cash Distri
Partners' Capital - Cash Distributions (Details) - Cash Distributions - USD ($) $ / shares in Units, $ in Millions | Feb. 05, 2021 | Nov. 06, 2020 | Aug. 10, 2020 | May 08, 2020 | Feb. 07, 2020 | Dec. 31, 2020 |
Cash Distributions | ||||||
Total Distribution | $ 52 | $ 51.6 | $ 51.7 | $ 51.7 | $ 51.6 | $ 206.6 |
Phantom Unitholders | ||||||
Cash Distributions | ||||||
Total Distribution | $ 1.1 | $ 0.7 | $ 0.8 | $ 0.9 | $ 0.9 | $ 3.3 |
Limited partner | Common units | ||||||
Cash Distributions | ||||||
Distribution per Limited Partner Unit (in dollars per share) | $ 0.525 | $ 0.525 | $ 0.525 | $ 0.525 | $ 0.525 | $ 2.10 |
Total Distribution | $ 50.9 | $ 50.9 | $ 50.9 | $ 50.8 | $ 50.7 | $ 203.3 |
Partners' Capital - Loss per Un
Partners' Capital - Loss per Unit (Details) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Phantom units | ||
Partners' Capital | ||
Antidilutive securities excluded from computation of loss per share (in shares) | 710,000 | 489,000 |
Warrants | ||
Partners' Capital | ||
Antidilutive securities excluded from computation of loss per share (in shares) | 0 | 0 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 157,513 | $ 178,999 |
Services provided over time: | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 155,469 | 175,902 |
Primary term | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 106,561 | 120,362 |
Month-to-month | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 48,908 | 55,540 |
Services provided or goods transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 2,044 | 3,097 |
Contract operations revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 155,469 | 175,902 |
Retail parts and services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 2,044 | $ 3,097 |
Revenue Recognition - Contract
Revenue Recognition - Contract Asset and Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 0 | $ 0 |
Deferred revenue | 48,792 | 47,202 |
Other liabilities | 8,570 | 8,200 |
Total | 57,362 | $ 55,402 |
Revenue recognized related to deferred revenue | $ 39,300 |
Revenue Recognition - Performan
Revenue Recognition - Performance Obligation (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 467,404 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 229,340 |
Remaining performance obligation, expected timing of satisfaction, period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 144,444 |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 61,819 |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 24,907 |
Remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 6,894 |
Remaining performance obligation, expected timing of satisfaction, period |
Transactions with Related Par_2
Transactions with Related Parties (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Transactions with Related Parties | |||
Related party revenues | $ 2,950 | $ 3,157 | |
USA Compression Partners, LP | ETO | |||
Transactions with Related Parties | |||
Ownership interest (as a percent) | 47.00% | ||
USA Compression GP, LLC | ETO | |||
Transactions with Related Parties | |||
Ownership interest (as a percent) | 100.00% | ||
ETO | |||
Transactions with Related Parties | |||
Related party receivables | $ 44,900 | $ 44,900 | |
Entities affiliated with ETO | |||
Transactions with Related Parties | |||
Related party revenues | 2,950 | $ 3,157 | |
Related party receivables | 0 | 120 | |
Related party payables | $ 6 | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Minimum | Oklahoma Tax Commission | ||
Other commitments | ||
Income tax examination, estimate of possible loss | $ 0 | |
Maximum | Oklahoma Tax Commission | ||
Other commitments | ||
Income tax examination, estimate of possible loss | 21.6 | |
ETO | ||
Other commitments | ||
Accrued liabilities | 44.9 | $ 44.9 |
Related party receivables | $ 44.9 | $ 44.9 |