Exterran Holdings, Inc. (NYSE:EXH) announced today certain
preliminary second quarter 2015 financial results for the
businesses to be spun-off.
As announced in November 2014, Exterran Holdings intends to
separate its international contract operations, international
aftermarket services and global fabrication businesses into a
standalone, publicly traded company named Exterran Corporation.
Upon completion of the spin-off, Exterran Holdings, which will
continue to own and operate its contract operations and aftermarket
services businesses in the United States, will be renamed Archrock,
Inc.
Exterran Corporation’s full financial results for the second
quarter 2015 are not yet available and are subject to finalization
by management and review by Exterran Corporation’s independent
auditors. Set forth below are certain preliminary estimates of the
results of operations that Exterran Holdings expects Exterran
Corporation to report for the second quarter 2015. Exterran
Corporation’s actual results may differ materially from these
preliminary estimates due to the completion of its financial
closing procedures, final adjustments and other developments that
may arise before the financial results for the second quarter are
finalized.
Exterran Holdings expects the following range of financial
results for Exterran Corporation for the three months ended June
30, 2015 ($ in millions except percentages):
Revenues: International contract operations $113-118 Aftermarket
services $32-35 Product sales (including sales to Archrock1)
$325-335 Total $470-488 Gross margin percentage:
International contract operations 60-62% Aftermarket services
27-29% Product sales2 12.5-13.5% Selling, general &
administrative expenses $55-58 Product sales bookings Approximately
$145 Product sales backlog (at June 30, 2015) Approximately $600
(1) Includes sales of newly-fabricated
compression equipment to Exterran Partners, L.P. (to be renamed
Archrock Partners, L.P. upon completion of the spin-off) of
approximately $50 million.
(2) Includes non-cash expense for inventory reserves currently
estimated to be $3.7 million.
In addition, Exterran Holdings expects Exterran Corporation to
spend approximately $205 million to $235 million in capital
expenditures during 2015, including 1) approximately $130 million
to $150 million on contract operations growth capital expenditures
and (2) approximately $25 million to $35 million for maintenance
capital expenditures primarily on equipment related to its contract
operations business.
Exterran Holdings’ parent level (excluding Exterran Partners)
debt outstanding was approximately $707 million as of June 30,
2015. Exterran Corporation’s capital structure is expected to
include (1) a new $750 million revolving credit facility that has
been executed and will become available upon the completion of
Exterran Corporation’s separation from Exterran Holdings and the
satisfaction of certain other conditions and (2) subject to market
conditions, the issuance of new senior notes due 2022. The
revolving credit facility includes, among other covenants,
financial covenants requiring Exterran Corporation to maintain
(after the separation) an Interest Coverage Ratio of not less than
2.25:1.00, a Total Leverage Ratio of not greater than 4.50:1.00,
and a Senior Secured Leverage Ratio of not greater than 2.75:1.00,
as they are defined in the credit agreement. Exterran Holdings
anticipates that Exterran Corporation will transfer the net
proceeds of its debt arrangements, including amounts Exterran
Corporation borrows under its credit facility and the net proceeds
Exterran Corporation receives following the issuance of the senior
notes, to allow Exterran Holdings to repay its indebtedness.
Subsequent to June 30, 2015 and prior to the completion of the
spin-off, Exterran Holdings expects to incur additional borrowings
under Exterran Holdings’ existing credit facility between $45
million and $55 million to finance expenses related to the
completion of the spin-off and related debt financings, which would
increase the amount that Exterran Corporation borrows under its new
revolving credit facility and transfers to Exterran Holdings to
allow Exterran Holdings to repay its indebtedness.
At July 2, 2015, Exterran Holdings was due approximately $100
million of principal payments from the previously announced sales
of nationalized Venezuelan assets, which amounts will be due to
Exterran Corporation following the spin-off.
About Exterran Holdings
Exterran Holdings, Inc. is a global market leader in
full-service natural gas compression and a premier provider of
operations, maintenance, service and equipment for oil and gas
production, processing and transportation applications. Exterran
Holdings serves customers across the energy spectrum – from
producers to transporters to processors to storage owners.
Headquartered in Houston, Texas, Exterran has approximately 10,000
employees and operates in approximately 30 countries. Exterran
Holdings owns an equity interest, including all of the general
partner interest, in Exterran Partners, L.P. (NASDAQ: EXLP), a
master limited partnership, the leading provider of natural gas
contract compression services to customers throughout the United
States. For more information, visit www.exterran.com.
About Exterran Corporation
Exterran Corporation will be a market leader in compression,
production and processing products and services, serving customers
throughout the world engaged in all aspects of the oil and natural
gas industry. Its global product lines will include natural gas
compression, process & treating and production equipment and
water treatment solutions. Outside the United States, Exterran
Corporation will be a leading provider of full-service natural gas
contract compression and a supplier of new, used, OEM and
aftermarket parts and services. Exterran Corporation will be
headquartered in Houston, Texas, and will operate in approximately
30 countries with approximately 7,000 employees.
Forward-Looking Statements
Exterran Holdings has provided a range for Exterran
Corporation’s preliminary estimated financial results described
above because its financial closing procedures for the second
quarter 2015 are not yet complete and will not be publicly
available until August 2015. Exterran Corporation’s actual results
may vary materially from these preliminary estimates. Accordingly,
one should not place undue reliance upon these preliminary
financial results.
All statements in this release (and oral statements made
regarding the subjects of this release) other than historical facts
are forward-looking statements within the meaning of Section 21E of
the Securities Exchange Act of 1934, as amended. These
forward-looking statements rely on a number of assumptions
concerning future events and are subject to a number of
uncertainties and factors, many of which are outside Exterran
Holdings’ control, which could cause actual results to differ
materially from such statements. Forward-looking information
includes, but is not limited to: Exterran Corporation’s anticipated
financial and operating results and expectations for the second
quarter 2015 and full year 2015; Exterran Holdings’ plan to conduct
a separation of certain of its businesses; the possibility that the
proposed separation will be consummated; the timing of the
consummation of the proposed separation; the expected benefits from
the proposed separation; statements regarding the expected capital
structure of Exterran Corporation; statements regarding the amount
of expected expenses related to the completion of the separation
and related debt financings; statements regarding Exterran
Corporation’s use of proceeds from its expected indebtedness; and
statements regarding amounts owed by PDVSA.
While Exterran Holdings believes that the assumptions concerning
future events are reasonable, it cautions that there are inherent
difficulties in predicting certain important factors that could
impact the future performance or results of its business. Among the
factors that could cause results to differ materially from those
indicated by such forward-looking statements are: local, regional,
national and international economic conditions and the impact they
may have on Exterran Holdings and its customers; changes in tax
laws that impact master limited partnerships; conditions in the oil
and gas industry, including a sustained decrease in the level of
supply or demand for oil or natural gas or a sustained decrease in
the price of oil or natural gas; delays, costs and difficulties
that could impact the completion and expected results of the
proposed separation transaction; Exterran Holdings’ ability to
timely and cost-effectively execute larger projects; changes in
political or economic conditions in key operating markets,
including international markets; any non-performance by third
parties of their contractual obligations; changes in safety,
health, environmental and other regulations; and the performance of
Exterran Partners.
These forward-looking statements are also affected by the risk
factors, forward-looking statements and challenges and
uncertainties described in Exterran Holdings’ Annual Report on Form
10-K for the year ended December 31, 2014, Exterran Corporation’s
Registration Statement on Form 10 and Exterran Holdings’ filings
with the Securities and Exchange Commission, which are available at
www.exterran.com. Except as required by law, Exterran Holdings and
Exterran Corporation expressly disclaim any intention or obligation
to revise or update any forward-looking statements whether as a
result of new information, future events or otherwise.
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy the senior notes due 2022 or any
other securities.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150713006281/en/
Exterran Holdings, Inc.MediaSusan Moore,
281-836-7398orInvestorsDavid Oatman, 281-836-7035
Archrock (NYSE:AROC)
Historical Stock Chart
From Mar 2024 to Apr 2024
Archrock (NYSE:AROC)
Historical Stock Chart
From Apr 2023 to Apr 2024