CCLP - Earnings call 3 2023 | CSI Compressco LP

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Operator

Good morning, and welcome to CSI Compressco LP's Third Quarter 2020 Earnings Conference Call. Speakers for today's call are John Jackson, Chief Executive Officer of CSI Compressco LP; and Jonathan Byers, Chief Financial Officer of CSI Compressco LP; Rob Price, Chief Operating Officer, also is in attendance. [Operator Instructions] Please note this event is being recorded.

I'll now turn the conference over to Mr. Byers for opening remarks. sir. ahead, go Please

Jonathan Byers

statements Good Quarter thank I'd XXXX that These may remind Keith. deemed may CSI be to like for Compressco's you forward-looking. contain call conference Third Results this are morning, you, or you be and are statements joining to a analyses many that Thank are Conference number statements These of and CSI the number risks and uncertainties, made beyond to and of on which the based assumptions are of Compressco of factors. are by certain partnership. based a control subject on Call.

You of in are may the that cautioned differ that performance results statements. such statements are not actual projected forward-looking future guarantees materially those from and

nearest free public within the we website for Please These GAAP flow, course of reconciliations financial period. not addition, cash release to of should reconciliations ratio, accordance cash distribution non-GAAP the our coverage complete In ratio, EBITDA, financial to our for context the this or to substitute considered may or measures. financial flow, call, be financial in to in information GAAP and other are non-GAAP leverage distributable EBITDA, of with prepared measures. press refer the a morning's utilization refer adjusted gross for results the measures margins,

over call of replay. Jackson. the time I of turn will press this XX-Q on John be that, provided will filed In may out speaks November earlier Please that our Form that at to only on accurate management's our be no announcement information addition this to posted to went views as it later longer and today, release With X, website, now morning and our is note today.

John Jackson

fourth call. will XXXX itself and Compressco and flourish macro for quarter is CSI and joining a Today, results, positioning XXXX the discuss Thanks, John. few thank third outlook activity beyond. how you quarter Good and I morning, comments and to cover our in

several or compression the factors space, the discipline for and terms, contract have more to the times the build at more primarily about and improving for for around units, to compression horsepower factors pricing growing create CPI compression These a durable capital desire changed I quarter, stable, producer past contract new last market industry. protection, overall lead market environment So this long how tight market than revolve spoke cyclical need outsource XXX-horsepower worldwide. and the duration, and natural for in lengthening gas less larger,

change our Nothing the view to has happened market. of

year-end viewpoint backdrop, and changes company provide is confident what even last is are our from head quarter These factors for compression with Overall, bright to we past from this that macro or the gas. continue towards and cycle prolonged more we up we We industry. XXXX. the in to for a natural think now the believe future as into visibility

goals today. CSI discussed the net continue of walk improve we goals cost of had operational execution our growing significantly. our to a reducing achieving Compressco and quarter, these EBITDA to each through be towards efficient, Last while of in revenue want trends some that disciplined I leverage manner, to

reflect macro at of quarter strong compression. we results backdrop look As the the financial third XXXX, for the

continues fleet from This complete improving still rates at quarter and The the higher net growth to leverage quarter-on-quarter. the multi-quarter build increasing is units contract of revenue, transition but far services trend underway, price continues to of on our metrics. market EBITDA as to market rates

Compressco's EBITDA does ongoing reflects Egypt quarter over have any third contracts. sequential have effort contracts through CPI-based year growth, of which This 'XX. significant next not our the those significant rolled at growth multiyear well do In portion quarter-over-quarter the Year-to-date, sustained end negative the period for protection with EBITDA contracts QX XXXX as in impact to all addition, in the will Latin to contracts has yet as end year-to-date multiyear over a still have 'XX contract the was and second at be in an growth that the XXXX CSI of operation net This of had not update quarter same versus of QX renewal. CPI associated include EBITDA America XXXX. sale EBITDA we nonrenewal is not EBITDA, a as of of Also, of Egypt XXXX. the sold

This underscores our changes, the of performance. net strength of EBITDA these increase,

level. high In addition, to business at AMS perform our continues a

the The team selectively and industry but the execution at the third gross a have AMS quarterly to but large highest order a quarter approach the the one-off high the change of profit group company. a to of the job type done, record and for execute profit work throughout this in taking the is to Congrats the we quarter is skill the management, not performance result was AMS level. for bidding the only AMS quarter, of project this well year. disciplined This job, gross not pricing,

of turn let's accelerated focusing been initial the The as early operational in rigor. and have but were the to a on our efforts to attention our during fleet. years started new have what X performance. idle to back active intentional began of and fleet along in XXXX, more units XXXX. put building work After Now CSI to our portion effort deploying burst last X in activity very These work we 'XX, 'XX expanded Compressco we operational been in of term with

our units processes. taking predictive Working challenge in rates organization, within restaging sampling our units, efficiently. Compressco projects working supply itself This related reduced to DSOs desire, compression-rigor These of balances. theme improving repeatable execute capital chain of have group the maintenance is The we we Unit technology deliver fleet forms. visibility inventory been and pursuing machine they to each a to purchasing failures. our and more reduced major in CSI we and predictable, market terms, is and learning pricing internal improving longer for as rigor through off implementing are just includes as management, the projects such on avoidance many no are units of come results. embedding come of The increasing on on

are initiatives believe we beyond efforts these of in and will improved XXXX of number early be stages, these operational the but the via cost reflected benefits in A metrics.

relates goal last The I leverage. primary to mentioned

we debt. continues net are under levered. Xx also improve to leverage by come our Our but as now EBITDA, net growing This from reducing has our about

and amount free reflected This X-plus seeing We some have plan has indicated in are reduce years. continual of been that over we last the we generate current throughout the focus flow a to year that the cash debt, to modest results.

has see net leverage. our say hard Byers to that in pleased We reduce comments. his are will to been the done the results actual more John to have reflect this work about

to performance provide from some updates. can we Moving the future,

AMS deployment new customers installed fourth customers units in some is quarter. fourth there's the XXXX, we business profit slowdown activity during quarter AMS Contract the build to the into holidays, segment. we on segment additional change As seasonality Services gross that in our look of Offsetting can back the our a is drop during the that the our normal for AMS quarter revenue the the be of expect usually to business potential and bit of in to fourth will from due a

Our fleet is effectively nearing full utilization.

And of horsepower, third defined XX.X%. approximately approximately of horsepower at our ended has is quarter the utilization being representing reciprocating horsepower, Compressco's over end as the fleet, of XX% CSI fleet large XX%. quarter that X,XXX fleet, XX% at a our Our utilized. horsepower all the utilization

in to and mid-XXs units remain nonreciprocating these rotary of utilization for the foreseeable percent GasJack fleet type as fleet in and our Our remains the future. utilization that utilized, far as we expect approximate

amount of horsepower As reciprocating a to work. small result, true very uncontracted a back there to put remains idle

have being ready deployed. on contracted of customer because unit before that We deployed additional yet is horsepower or the timing make work not

not churns not contract. customer of period as so it generating contract, of not revenue. while but to a The will not our under percentage generating have equipment unit, unit X As from revenue, may do we utilized, always utilized, some that be fleet time count being we there's under another, is

our to million. look EBITDA to we XXXX, remainder of the million $XXX we year guidance As of $XXX for reiterate full

$X.X to leverage $X.X net guidance of year-end Our million. million

are of leverage. ranges and end XX currently basis for on trailing EBITDA those We a XX-month inside both quarter -- net

call. give on earnings guidance expect for XXXX We our year-end to

will Every build Our on contracted we completed current a multiyear on revenue for term that XXXX. new customer. order outstanding deployed and unit and by units the late with be the units capital currently is commitments have on

can that customer We reconfigure are a portion that a of that a from units rate else a request for longer we To equipment higher may and idle for X today. to seeing unit there another, XXXX. small in currently demand. from transitioning additional will is contracted will requests, fulfill require multiple that term satisfy requiring than units remaining few customers be those Anything

capital require our to requests XXXX-horsepower for proposals these for requests of and the multiple have these total Many ability will in we build of exceeds requests far customers. addition, In coming from new fund. already

currently we capital focus EBITDA. We units. early QX reduce to continue are continue we the contract allocation XXXX. in look net process well current new-build Based growing might levels, activity our and to will capital discipline for by this our we for on on XXXX metrics as of all while of XXXX capital allocated Throughout new-build leverage process, returns to and

coming we how over the environment, quarters. longevity to CSI be the and the macro of to is continue positioned Overall, cycle Compressco bullish about the perform

to level in growth. leverage This go deleveraging and of is and We while believe growing our metrics believe continue natural a cycle EBITDA. gas as to improvement forward. especially evidenced we focus by we this ability longer long-term high and will on multiquarter absolute the We our in and at stronger, returns continue fundamentals perform versus

ways we excellence. pursuit continue Finally, to do will we of we in as instill to our operational everything look rigor continue for

engaged there's been our operational While made pleasure operational here. thank mantra do to of we what for I a every the strides see so lot looking performance, of employees believe in It improve want to efforts. how our from to we all and and opportunity of and job. lot ways has each a for embracing in constantly have the still these employees a rigor we

John turn over now the call I'll to Byers.

Jonathan Byers

Thank you, John.

million of reported the the of For quarter million quarter third Compressco EBITDA $XX.X XXXX, XX% XXXX, $XX.X third of increase. to in CSI compared a adjusted

large revenue in horsepower XXXX. from services particularly to driven among This and year-over-year $XX.X of $XX.X pricing, the quarter X% quarter the our grew of third was continued contract by million equipment. utilization in in Our million XXXX improvement third

Year-over-year, to in XX.X% our XX.X% from the quarter of third utilization increased XXXX.

grew was than AMS the X% prior and year-over-year XX% higher quarter. revenue Our

to on Moving profitability.

our were just Services and gross margins said, XX%, perform well, up with of John basis points for [indiscernible]. margins XXX over Our about QX, AMS business, gross as Contract to continues

and to with XX, November third a our Distributable cash XXXX, flow $XX X.Xx. $XX.X was third coverage the $X.XX quarter distribution million million quarter of on of in pay we'll compared of distribution ratio

compared When million. of the guidance XXXX our sale second the spending for offset $X the to from is quarter. proceeds Egypt $XX in to redeployment assets capital million $XX million increased approximately the of by Our of prior our has guidance, to increase cash

goals John is X of significantly As to reduce our mentioned, primary leverage.

September is of XXXX, over X leverage a of of years leverage XXXX, from X.Xx. of CSI ago. QX XXXX in a X.Xx As QX lowest has down is XX, reported net leverage of Compressco delivered ratio we This ratio peak and the net since

guidance We're leverage year X.X net currently at exiting the the anticipate X.Xx X.Xx. low to around and end our of of

our we XX% A year. of was Cash on quarter That's beginning related is million. increase $XX.X almost undrawn to end, At how the liquidity liquidity. at from building of leverage ABL that. the look reducing hand our is focus an capacity plus total

have teams team of we're the Financial throughout has from mature perspective been The on XX these lien on engaged the lenders John with operations April in on, fall have our sheet optimistic our XXXX, and refinancing And about predictable, refinancing AMS banks, said, summer balance conversations focused bonds in improving focused alternatives first as been end agencies. conversations. Currently, and our finance results. and our repeatable Our we as of months rating and based QX.

not strategy duration, the operating units. balance and which John improve to discussed is is CSI in regarding the showed demand success new-build evidence short results months. our Equally disciplined our and effort equipment our grow our deleveraging. The to capital outlook measured the QX and of of existing The is performance pricing, in business. QX a employees' positive new-build business. being and years, compression for and of on was contract manner as industry growth multiyear strong important, market there's

now will we that, With to questions. the call open

Operator

Markets. And from Instructions] first [Operator Grampp Capital question comes Jeff the Northland with

Jeffrey Grampp

you you upside Was a guys today? pricing what initiated some contracts of look to mentioned hoping rates. if legacy kind ago more say, contract at, detail you delta get years Curious, from today's to little a that in versus roughly, repricing bit X, kind of is terms of X

John Jackson

X,XXX the increase let's in at from but larger up, to market call where unit. on a So is it's tight, I depending going to and compressor, XX% it the general, looking would the in really say, of vary size you're the the horsepower XX%

if $XX,XXX end Maybe side for it XX% just, X,XXX-horsepower ], a the of if XX% it of And is. how then. up. you're general, from [ to 'XX depends in into putting ] could $XX,XXX rented the just a 'XX, on something day, it But Today, month -- higher that. XX I'd higher $XX,XXX to It a where say, So XX% XX is be year or that, than maybe it's it's like going you're out that. example, XX end anywhere XX, tight it's either was that. at was and than looking of unit XX% 'XX, at at rented [ ago, something it

of customer. units we multiple have the have with our units some -- out Now

have have We operational to provide. we metrics

for may be those that So lower the rate be of some services we higher call. take may first don't if

around the you're fleet, So general probably lot XX% terms, there's that. of a in XX%. end on But higher the of to nuance

to to of X On the you're were ago. end, fleet, the XX% on you're you XX% lower probably small -- higher XX% years than the probably end XX%

our of XXX-horsepower a And up segment we segment the least as about I get talk don't, and not. those why So sales multiyear contracts that we I up kind when mixed tight but what's think being below units what's the and and think about, XXX-horsepower then that's can maybe the them. it's on XXX-horsepower we as at do, segment but bag, about and guys

really out a power got term may a So out that's term and XX% you go say, X it, us, but really That's or I'd been on may we've what it it's That's pricing on interim years. increase impactful our can case unit a impactful and X-year bit have put a be. you when for than, years, little what's the XX% X price more of less unit whatever and on. on focusing for

Jeffrey Grampp

smidge,and CapEx That's offset Understood. driver for And up that. that's noticed talk my great. that But Yes. some sale. I a I year the for went can from I guide this follow-up, there? appreciate on know you the just asset main of the

John Jackson

a level. bit Rob about that let Price for I'll Yes. just on

Robert Price

be taking months. this up advantage of capital maintenance are that Our due they say, and went the lot overhaul guidance redeployed, slightly. A of units is due were to within going to for X next

we to So trying next do it units our got in deployed to service. interrupt didn't a to situation service ahead what to customers we basically, so the would it the it's been bit the year. maybe of have from were decided to have scheduled little pulled maximize that before customer it optimize so But

John Jackson

out to is. we customers to go what market as to term market believe don't or been We've if where been want to trying -- we also them to contracts, the a the pushing some rate lot around customers rate different we've on don't our push reprice want

have then so churn, that's unusual we And we from and our prior customer-driven churn have side. on And driven called cycles. that's

a as these result, unit so touch we've mentioned, as And more. Rob had to opportunities, the

updated of it opportunity If the you're it before to, on Rob out going a shop to run X of get lengthen by having accelerate to it's and that. cycle, But some desire that up X it to maintenance months. then said, as put our it years driven there that's do our and on We're visibility. coming or some duration for need using a to taking something do through and you up it

Jeffrey Grampp

Understood.

any end? the not of anything and CapEx, effectively is a some cost change maybe or that it equipment of on really forward pull of inflation like related to 'XX So maintenance

Robert Price

No. churn It's taking goes resources, that and advantage on of available in terms contract process. the

Operator

comes question from And with the Derbio Baird. next Brian

Brian V. DiRubbio

and third EBITDA customer. couple we say a sales obviously, LatAm adjusted would questions growth about is you Egypt Byers, as don't for and want just the large the John organic quarter operations, I and you. of quarter? numbers for in think have contract we What the

Jonathan Byers

numbers. the LatAm our take in would if XQ so not was you I say --

So it's really just Egypt.

about probably of showing organic another growth So up quarter-on-quarter. $XXX,XXX

you $XX.X is probably growth. $XX.X it organic $XX.X look million QX million [ million if million, to of revenue So were around about so ], you $X puts

Brian V. DiRubbio

because third missing I versus Okay. year last guess quarter of twofold? you're those

John Jackson

Yes.

Jonathan Byers

and LatAm same year-over-year, the thing about million, customer on revenue. Egypt $X of So say would probably would be I

So a fairly impact. significant

Brian V. DiRubbio

Okay.

[indiscernible]. So probably or on digits digits a organically, double over you're closer to double well

John Jackson

a grown comment we've top kind of and yet significant that of of taken step That's because Absolutely. back is on have the of point X still that. those fairly contracts

Brian V. DiRubbio

That's Got it. encouraging. really

you around can horsepower Are talk trying sort the What equipment, of don't hopefully, someone the GasJack that plan sit off liquidity? way a the and them let have thoughts small of to them about Just about just there you home. maybe those? that buy? going is to the is with equipment, really any to Or get another picks rid to it where add just

John Jackson

that at doing this are we're selling we is stranded else. some where are anything GasJack or area what have necessarily think, don't an in we idle point, I

you X.X if years of ago fleet X,XXX them. but we X.X GasJack almost ago. look have to have had today, around we years were or We -- just today, over in GasJack disposed So XXX sold we back X,XXX XX our

or other doing that. have And opportunities running over have GasJack still idle we them, There meantime, are in primarily we to our areas. so who Mid-Continent. the use customers as other X,XXX the want fleet, in to are In sell selling and that people to we're

So and to those. at this operate continue we'll run point,

it doesn't on value operate fleet, apply we subject equation. our the puts anything GasJack, wants And a Obviously, it. value to someone that operate, and to that on than and certainly someone then it we own that it's that to a that the we to valuation more we everything just is but they put rotary apply own entertain would do, that, would value if

smaller lot competition. So I in think there's the of right now, a horsepower,

a financial any to wherewithal a and scale that get be find we X,XXX the have, this desire for equipment has someone hard at to scale. that going so value on to units, to on that And is of that spend money that

I year put as to couple them we've work other we fairly to that. hundred them sell them and out of move and people at to been think a and revamp can we a successful people

we I a but happen. take strategy along, So to to that expect that don't would approach, but measured right now, came our anything at obviously is look more

Brian V. DiRubbio

Understood. quick will be that me. and Two ones, for

Just inflators do CPI think what percentage of your today has business you place? in

John Jackson

So of it in look different of at our -- couple so I a ways.

to So to different revenue way, total nuance a international I is because in say little answer world. your -- revenue our of just question But total contracted, U.S. U.S. a a of But it's multiyear XX% more CPI have is only the say I approaching to kind total this you we're revenue, in revenue. that contract. of applied our about the would the think inflater

multiyear and also what So it that's that have and we segment CPI in are at it, the on outstanding look of today mid-XXs. contracts our

call day, year every were go percent of it'd XX%, right? back So to time couple be this I ago, of a changes So think the give let's or And a X%. you take, XX%, it somewhere mid-XXs. if to in

last quarter these able we put in, just So started year. in the of being to third

make would So those I a said? percentage that very Does be contracts to. we've from large to moved sense, what a CPI very that percentage a small applicable of

Brian V. DiRubbio

last us trying sense the the And No, could where some it maybe is? just or compressors. question. Time providers? the that And [indiscernible] any also backlog solely pin get say help to for getting worsened Caterpillar, where a then is be. new gotten better? as extremely helpful. Is or where at with of the it I of would That's you Has Aerial log can supply clear down or other Just in chain. is a as the gem

Robert Price

This is Rob.

you're I range capital Obviously, we're has out, lead the on compressor a category. in the only looking. building, horsepower deploying on we're think the year that package what time least a on depending at side large new stayed

driver, the get or So that the XX-plus or the out that, somebody you're still plus path packages you lead your quicker engine canceled time an segment. year that can to unless that item something And critical ability weeks like a is out. we're else still limits find engine, in has the

John Jackson

issue engines And with diesel I These don't think gas build engines for to is they just the segment. Caterpillar other... and get the same natural applied

Jonathan Byers

marine. [indiscernible] Construction

John Jackson

So allocating more they're they're so they're busy spectrum. this engines because other busy segment and segments, in across to not the

I this So tight. to expect remain

Jonathan Byers

for At a least year.

John Jackson

say At think on I X so the they've going expected least for been We're the last weeks quoted next year, as the be contracted delivery our theme we order. engine months the to X far a year. X when engines them. to few And when actually X deliveries, their initially on -- behind time, would we that's this are delivery, to the but they've been been place over behind they I

So of will, months. take couple a that you year take out, a what or give

Jonathan Byers

Right.

Operator

next the And Akyol question Stifel. comes from Selman

Selman Akyol

Should So 'XX. me sold of it we horsepower? all ask, talked going as about in years? for X of just already your that out than X,XXX being those being think let And all large for out probably of units you excess are

John Jackson

They're 'XX. contracts. Yes. they're XXXX-horsepower all what And type all X,XXX or in X-, units. That's X-year all we're Yes. they're building --

Selman Akyol

Got it.

Jonathan Byers

[ ] or XXXX Everything has XX since been larger. we've built a

Selman Akyol

still talked sort to as 'XX, there seeing sold getting to it? just you're you Or those also out be well. looking you're additional about then increases of between wondering, deploy kind that you that can the And in is of about you're of any sort 'XX stuff prices price you and early XX%? And engaged looking plus Understood. Are in talk I'm as on to pretty conversations? [indiscernible]

John Jackson

the moved compression the on Aerial, contracting in to Cat, market, of a would the on have next over XXXX, ago. across out quarter the in the was talking we're about a lot you're say on a I year what And later tightness deploy. now have industry quarter since on year go what year well at contracted is capital this then people and seeing the prices first that

my said capital case. is opening everybody the I think I disciplined. that and in comments, that remains being

capital but anyone seeing our today the deploy from So to signing can't I cash the cycle full capital I'm for speak this of their work. hearing that contract the for put cash anyone you're other payback on deploy to want what and to today, companies, you to customers, in from

dynamically. So increases that's requiring price

-- we you deploy and doesn't sign let's kick year XXXX. price as just so of we XXXX, a the inflator this that. CPI May -- until a this on contract about doesn't the say of in first contract put signed It at CPI May you a protection to think So end of in -- the hit

your it's So before you window. going years getting price know X during away and almost that inflation don't you're first what do increase, to is

have XX-month initial though still this CPI you're protection, even So exposed in window. you almost

So up that the the that a prices new limited build significant build year have, increases price delivery, quoting you in with amount from going capital on capital. are the this new last absolutely year are you combine on to

the early QX by sold that be said or of end could by out I QX. So we

because to we're this going a decide on to valuable depend It's as do what pricing us. people to commodity

first those window capital to want and a quote and it's and all because order We're and seen. we gone, done. we show But we're to of all that really solid it's decisions up make pick consume third lot to gone. So well. trying second we want and customers have once Whether cherry inquiries, our really remains be in returns what battle that

Selman Akyol

assessment presume fair you're customer well? Is I a within as those list your comments, customers. of growing X is that Got but each it. dwindling, those From

John Jackson

also a to we That's fair degree, it's assessment debate an assessment internally. some that but

-- for of week. I talking our this Sales to Head have We example, was

recent for want some where existing our so We this want you feed available? these in add of have are -- our And customers to you equipment have to new of take have some that's do we could do new of through. a out additional the capital to you sold basically supply balances your to us? limited to a them, continue have Or way through build fleet, allocate fact our decision-making the to the go want is of work capital. and customer that or customer? in some our Given Do to asked existing some of care come part for we're and we we we and have

So million at customer to unit, each. and would $X.X new X,XXX add ] are of such the the time, $X.X like new customers, want those same but may [ we million, horsepower

-- it's spend million to $XX capital. chunk years. $XX when It's million, your looking us, $XX So the million of discretionary you're capital that's cash of for in to $XX a going coming million discretionary in at big you're flow,

these going allocate So decide new and to debate that the existing people have you kind of capital, things are what you're to want? and where your customers, customers

about the earnings they to a issues budget we customers to these because to XXXX wanting have far have these people months and of start will they're on as know for a are our thing going is get right had expect call, 'XX, get of of time plan our The ready commit need and therefore, lot for unit as budget they need lot site, all now, as through their to talked able they times have being by not all XXXX their we've in been year-end the we going lead a on process capital XX, commit for customers and to XXXX, capital. other drill XX, commit XX But to in people we advance.

they trying able may talk we to do today. front our of I very lot going them and other we're and more as demand why not seeing you. even because a proactive, think say, be move look, customers to we find we're this budget than later get units to have need to much that's through get cycle, rather off to And term than be to in for know as to than we're we sooner them you come So

commentary there, delicate it's lot quite a act. but balancing of So it's the

we grow could -- can We base. balance find is grow to a it's base our new customer So customer tricky. existing but that trying and,

Selman Akyol

then me. Got And just X last for it. the

can guess I and to notes talk some already with pricing, just of I of that thinking terms you're address should mentioned refinancing. year? seeing be any you about anything next generalities as lenders You you'll you're that we those at look beginning talk about in the presume

Jonathan Byers

plan to them year. next address the that's Yes,

of pretty pretty a pricing is pricing, wide on with we've lien In terms at being seen X.X%, our range. good. And that first

overall, interest ]. of up is X that go expectation our [ could our [ kind X -- to our ] So

Operator

with the Bank next question Brody comes America. And from Gregg of

Gregg Brody

other a funding any attractive on cash have Just build with flow some new would this fund are for them? contracts on to look that's of you Are funding starting financing. Is there to these out there follow-up there make avenues to -- of financing growth. Clearly, maybe your contemplating? that some sense you're

Jonathan Byers

Yes.

We have for some financing. alternatives different

One interesting, one given and signing, well of that the that's is capital been contracts new the we're done We've the those they've at attractive a years, contracts, over particularly rates. of X of last the pretty the few -- leases. worked term out

far of Really, want grow of the as and rates that how spend cash given available. focusing business the we business, it, capital some deleveraging balance question do versus As flow? much on the to lot think free I the there's to a the on and is, driving

John Jackson

just to we ABL some arbitrage lease capital job, true accelerate down an -- alternatives those free cost structure. then down the part we But kind whatever John chasing is, that John of unknown, is kind as growth liquidity our -- capital we an could, I if financing. flow our to get that versus but know out potentially what have capital known using when and it's are be to of come attractive. found what on a you're [indiscernible] go-forward or figure or able cash might some right think refinanced I we'll the that of using interest versus a we is great just lease has source the done of think, we be will mentioned, all Because, going

Gregg Brody

What is is some leases? capital for these cost today's market, capital what of the of

Jonathan Byers

It's at or below ABL debt.

Gregg Brody

the X on more this just then And so limitation you. more point, than component Got at availability? availability growth here. last Is capital

John Jackson

capital, of want component. us 'XX. and than Caterpillar $XXX spend I CAT to mean availability capital think there's -- XX more that for it's or issues. I if we But I went deliver said we could in think No, want million XX to we component

self-constrained. definitely it's So

down Our has sustainable this to been leverage primary motivation to environment. a get

using debt, debt been much to speak. levels and to we've free grow, So our our into our flow growing cash sustaining so pretty but

like as not a that X may next what little bit over be years, whatever we're then at we will flow? going years, We're grow decisions going know to going to make really our cash Now there the that to X that's be, refinance do and look able we point. beyond on more

to do. really get of we want to to within closer want start flow. we we looking cycle Xx at think I cash We want down to that stay a what before

Gregg Brody

when could you And us you on guidance? plan remind just providing XX

John Jackson

Year-end earnings call, early you'll which late March. February, probably be

Operator

return for And to the would this question-and-answer I floor like session. closing Jackson to John concludes the any comments.

John Jackson

who us today. time live at those on to appreciate company. in with you for grow Thanks. we listening recording, to and year-end today look continue checking listened We to Appreciate for everyone the it improve and those to this talking forward and

Operator

you and presentation, today's attending lines. for you disconnect Thank concluded. your now may now has conference The

CSI Compressco (CCLP) 2 Nov 232023 Q3 Earnings call transcript