|
|
|
Company Links |
 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Business Environment |
|
|
|
Natural gas compression, a mechanical process whereby a volume of natural gas at an existing pressure is increased to a desired higher pressure for transportation from one point to another, is essential to the transportation and production of natural gas.
The domestic natural gas contract compression services business is highly competitive. Compression services providers can achieve operating and cost advantages through increased size and geographic scope. As the number of compression applications and size of the compression fleet increases, the number of required sales, administrative and maintenance personnel does not increase proportionately, resulting in operational efficiencies and potential cost advantages.
Additionally, broad geographic scope allows compression services providers to more efficiently provide services to all customers, particularly those with compression applications in remote locations.
|
|
|
|
Company Strategy |
|
|
|
The Company is a Delaware limited partnership formed in June 2006 to provide natural gas contract compression services to customers throughout the United States. |
|
|
|
Product/Services Portfolio |
|
|
|
The contract compression services the Company provides include designing, sourcing, owning, installing, operating, servicing, repairing and maintaining equipment to provide compression to its customers. When providing contract compression services, the Company works closely with a customer’s field service personnel so that the compression services can be adjusted to efficiently match changing characteristics of the natural gas produced.
The Company’s field compression equipment is maintained in accordance with daily, weekly, monthly and annual maintenance schedules.
Each contract typically has an initial term of six months, following which the contract would typically operate on a month-to-month basis until terminated by the Company or its customer. Following the initial fixed term, either the Company or its customer may terminate a contract with 30 days’ notice.
The Company’s customers pay a fixed monthly fee for the compression services, the level of which generally is based on expected natural gas volumes and pressures associated with a specific application. The Company is not responsible for acts of force majeure and the customers generally are required to pay a monthly fee even during periods of limited or disrupted natural gas flows.
The Company is responsible for the costs and expenses associated with its compression equipment, other than fuel gas, which is provided by the customers.
The Company is responsible for providing contract compression services in accordance with the particular specifications of a job, as set forth in the applicable contract. These are typically turn-key service contracts under which the Company supplies all service and support and use its own compression equipment as necessary for a particular application.
Both the Company and its customers are required to carry general liability, worker’s compensation, employers’ liability, automobile and excess liability insurance with respect to a particular project.
|
|
|
Investment Analysis |
 |
|
|
Revenue increased 24.9% to $195.5 million for the the six months ended June 30, 2006 from $156.6 million for the six months ended June 30, 2005.
Gross margin increased 27.3% to $126.8 million for the the six months ended June 30, 2006 from $99.6 million for the six months ended June 30, 2005.
Depreciation expenses increased 13.5% to $38 million for the the six months ended June 30, 2006 from $33.5 million for the six months ended June 30, 2005.
Net income increased 28.3% to $66.9 million for the the six months ended June 30, 2006 from $52.1 million for the six months ended June 30, 2005.
|
|
|
|
Income Data (Thousand $ Except EPS) |
| Year |
Revenues |
Costs |
Oper Income |
Taxes |
Net Income |
EPS |
| 2004
|
280,951 |
0.00 |
0.00 |
0.00 |
73,430 |
0.00 |
| 2005
|
296,239 |
0.00 |
0.00 |
0.00 |
84,004 |
0.00 |
| 2006
|
195,505 |
0.00 |
0.00 |
0.00 |
66,896 |
0.00 |
| *As of period ended June 30, 2006
| |
|
|
Balance Sheet Data
(Thousand $) |
Year |
Cash |
Acct Recv. |
Inventory |
Total Cur Assets |
Total Cur Liability |
PPE |
Total Assets |
LT Debt |
SH Equity |
|
2005 |
0.00 |
23,,042 |
0.00 |
0.00 |
0.00 |
991,128 |
1,275,922 |
0.00 |
0.00 |
|
2006 |
0.00 |
57,021 |
0.00 |
0.00 |
0.00 |
1,002,213 |
1,320,986 |
0.00 |
0.00 |
|
*As of period ended June 30, 2006
| |
|
|
| Cash
Flow Summary
(Thousand $) |
Year |
Net Cash-Ops |
Net Cash-Inv |
Net Cash-Fin |
Net Change |
|
2004 |
155,085 |
-17,858 |
-137,227 |
0.00 |
|
2005 |
158,464 |
-68,582 |
-89,882 |
0.00 |
|
2006 |
71,086 |
-47,184 |
-23,902 |
0.00 |
|
*As of period ended June 30, 2006
| |
|
| |
|
| |
|
|
- Avoid 
- Value Gap 
- Short-Term Growth
- Long-Term Growth 
- Long-Term Value 