March 23, 2020Exterran Corp. officers say compression fabrication will not be part of the company’s core U.S. business in the future. They said Exterran is nearing a decision regarding its compression fabrication business and should have an announcement in a few weeks.
Andrew Way, president and CEO, said, “We plan to partner with U.S. compression equipment providers where we have the need to provide compression for the U.S. integrated plant market and utilize our own global footprint to support our international markets for both contract operations and product sales.
“While compression has been a key part of our legacy,” he said, “the last 12 months have highlighted the need to focus on less cyclic, more value-added, service-orientated product lines. This will allow us to focus on higher margins, higher returns, and recurring revenue products and services.”
One of the latter is an Exterran process for treating water that is produced with crude oil.
“I believe that 2020 will be the breakout year for our water business, given what I see and know today,” Way said. “In 2019, our installed technology treated over 664 million barrels of water, while recovering over 775,000 barrels of oil for our customers.”
Exterran announced its adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were US$47.3 million in the fourth quarter of 2019, compared to US$50.1 million for the prior quarter and US$51.5 million for the final quarter of 2018. It said 2020 adjusted EBITDA should be US$155-175 million.
Chief Operating Officer Girish Saligram discussed the spread of coronavirus. “Currently, we see minimal impact on our supply chain and therefore little impact on our business operations on both projects and services,” he said. “However, the duration and severity of the outbreak is still fluid and ultimately could create challenges for many providers around the globe.”