Kodiak Gas Services Reports Second Quarter 2025 Financial Results, Announces $100 Million Increase to Share Repurchase Program and Provides Updated Full Year 2025 Guidance

THE WOODLANDS, Texas--(BUSINESS WIRE)-- Kodiak Gas Services, Inc. (NYSE: KGS) (“Kodiak” or the “Company”), a leading provider of critical energy infrastructure and contract compression services, today reported financial and operating results for the quarter ended June 30, 2025. The Company also announced that its Board of Directors has approved a $100 million increase to its share repurchase program, and increased full-year 2025 guidance for adjusted EBITDA and discretionary cash flow.

Net income attributable to common shareholders for the quarter ended June 30, 2025 was $39.5 million, compared to $30.4 million and $6.2 million for the quarters ended March 31, 2025, and June 30, 2024, respectively.

Second Quarter 2025 and Recent Highlights

  • Record earnings per share attributable to common shareholders of $0.43 per diluted share
  • Record quarterly adjusted EBITDA(1) of $178.2 million, a 15.5% increase compared to second quarter 2024
  • Contract Services adjusted gross margin percentage(1) increased to 68.3%, a 430 basis point increase compared to second quarter 2024
  • Generated record quarterly free cash flow(1) of $70.3 million
  • Returned over $50 million to stockholders through dividends and share repurchases
  • Deployed 31,800 horsepower of new, large horsepower compression units
  • Fleet utilization increased to 97.2%, a 290 basis point increase compared to second quarter 2024
  • Added to the S&P SmallCap 600 index effective August 6, 2025

Revised 2025 Outlook Highlights

  • Raised full-year 2025 adjusted EBITDA guidance to a range of $700 to $725 million, a $5 million increase to the low end of the range
  • Increased full-year 2025 discretionary cash flow(1) guidance to a range of $445 to $465 million

(1)

Adjusted EBITDA, adjusted gross margin percentage, free cash flow and discretionary cash flow are non-GAAP financial measures. Definitions and reconciliations to the most comparable GAAP financial measure are included herein.

"Kodiak's performance in the second quarter reflects our commitment to operational excellence and the strong fundamentals for contract gas compression,” said Mickey McKee, Kodiak’s President and Chief Executive Officer. “Our fourth consecutive quarterly increase in Contract Services adjusted gross margin percentage and our record quarterly adjusted EBITDA are the product of our strategic focus on large horsepower compression, fleet optimization and significant investments in both technology and our people. This approach not only strengthens our market position but also ensures we continue to meet the evolving needs of our customers with reliability and efficiency.

“Despite the challenges posed by global economic instabilities and energy market dynamics, our production-focused business model remains robust. The resilience of our operations is evident in our ability to maintain high fleet utilization and increase margins. As we look ahead, the highly visible Permian Basin natural gas production growth combined with the strong demand outlook driven by power demand for data centers and domestic LNG projects, reinforce our confidence in the long-term growth prospects for contract compression.

"The meaningful increase in our share repurchase program reflects that confidence and underscores Kodiak's commitment to returning capital to shareholders. Our focus remains on delivering superior service and maintaining one of the safest and most reliable compression fleets in the industry. Kodiak is well-positioned to capitalize on future opportunities, continue to drive profitable growth and increase shareholder value."

Segment Information

Contract Services segment revenue was $293.5 million in the second quarter of 2025, a 6.3% increase compared to $276.3 million in the second quarter of 2024. Contract Services segment gross margin was $134.3 million in the second quarter of 2025, a 24.9% increase compared to $107.5 million in the second quarter of 2024 and adjusted gross margin was $200.4 million in the second quarter of 2025, a 13.3% increase compared to $176.9 million in the second quarter of 2024.

Other Services segment revenue was $29.3 million in the second quarter of 2025, a 12.3% decrease compared to $33.4 million in the second quarter of 2024. Other Services segment gross margin and adjusted gross margin were each $7.2 million in the second quarter of 2025, a 31.6% increase compared to $5.5 million in the second quarter of 2024.

Long-Term Debt and Liquidity

During the second quarter 2025, the Company reduced debt outstanding by approximately $48 million. Total debt outstanding was $2.6 billion as of June 30, 2025, comprised primarily of borrowings on the ABL Facility and senior notes due 2029. At June 30, 2025, the Company had $366.4 million available on its ABL Facility, and Kodiak's credit agreement leverage ratio was 3.6x.

S&P SmallCap 600

S&P Dow Jones Indices announced on August 1, 2025 that Kodiak would join the S&P SmallCap 600 index effective prior to the opening of trading on Wednesday, August 6, 2025. The Company's addition represents a significant milestone and affirms its financial strength and commitment to profitable growth. For more information about S&P Dow Jones Indices, please visit www.spdji.com.

Share Repurchase Program

The Company's Board of Directors approved a $100 million increase to the Company's share repurchase program and extended the program's expiration date to December 31, 2026. Including the increased repurchase authorization announced today, the Company has $115.0 million available for repurchases under its share repurchase program.

Repurchases under the share repurchase program may be made from time to time through open market repurchases or through privately negotiated transactions subject to market conditions, applicable legal requirements, and other relevant factors.

To date, the Company has repurchased approximately 2.0 million shares for an aggregate amount of $60.0 million (at a weighted average price of $30.24).

 
 
 

Summary Financial Data 

 

 

 

Three Months Ended

(in thousands, excluding percentages)

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Total revenues

 

$

322,843

 

 

$

329,642

 

 

$

309,653

 

Net income attributable to common shareholders

 

$

39,496

 

 

$

30,411

 

 

$

6,228

 

Adjusted EBITDA (1)

 

$

178,216

 

 

$

177,664

 

 

$

154,342

 

Adjusted EBITDA percentage (1)

 

 

55.2

%

 

 

53.9

%

 

 

49.8

%

 

 

 

 

 

 

 

Contract Services revenue

 

$

293,534

 

 

$

288,956

 

 

$

276,250

 

Contract Services adjusted gross margin (1)

 

$

200,397

 

 

$

195,721

 

 

$

176,917

 

Contract Services adjusted gross margin percentage (1)

 

 

68.3

%

 

 

67.7

%

 

 

64.0

%

 

 

 

 

 

 

 

Other Services revenue

 

$

29,309

 

 

$

40,686

 

 

$

33,403

 

Other Services adjusted gross margin (1)

 

$

7,195

 

 

$

5,460

 

 

$

5,467

 

Other Services adjusted gross margin percentage (1)

 

 

24.5

%

 

 

13.4

%

 

 

16.4

%

 

 

 

 

 

 

 

Maintenance capital expenditures

 

$

17,565

 

 

$

16,407

 

 

$

19,147

 

 

 

 

 

 

 

 

Growth capital expenditures (2)

 

$

37,966

 

 

$

55,983

 

 

$

77,257

 

Other capital expenditures (3)

 

 

16,398

 

 

 

22,258

 

 

 

13,133

 

Total Growth and Other capital expenditures

 

$

54,364

 

 

$

78,241

 

 

$

90,390

 

 

 

 

 

 

 

 

Discretionary cash flow (1)

 

$

116,424

 

 

$

116,084

 

 

$

90,617

 

Free cash flow (1)

 

$

70,290

 

 

$

47,219

 

 

$

638

 

(1)

Adjusted EBITDA, adjusted EBITDA percentage, adjusted gross margin, adjusted gross margin percentage, discretionary cash flow and free cash flow are non-GAAP financial measures. For definitions and reconciliations to the most directly comparable financial measures calculated and presented in accordance with GAAP, see “Non-GAAP Financial Measures” below.

(2)

Growth capital expenditures made to (1) expand the operating capacity or operating income capacity of assets including, but not limited to, the acquisition of additional compression units, upgrades to existing equipment, expansion of supporting infrastructure, and implementation of new technologies, (2) maintain the operating capacity or operating income capacity of assets by acquisition of replacement compression units and their supporting infrastructure, and (3) expand the operating capacity or operating income capacity of existing assets.

(3)

Other capital expenditures made on assets required to support our operations—such as rolling stock, leasehold improvements, technology hardware and software and related implementation expenditures, safety enhancements to equipment, and other general items that are typically capitalized and that have a useful life beyond one year. Other capital expenditures were previously included in growth capital expenditures, but are now shown separately for both current and historical periods.

 
 
 

Summary Operating Data 

 

(as of the dates indicated) 

 

 

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Fleet horsepower (1)

 

4,419,884

 

 

4,422,914

 

 

4,481,900

 

Revenue-generating horsepower (2)

 

4,296,978

 

 

4,284,103

 

 

4,224,839

 

Fleet compression units

 

4,881

 

 

4,941

 

 

7,317

 

Revenue-generating compression units

 

4,514

 

 

4,545

 

 

5,753

 

Revenue-generating horsepower per revenue-generating compression unit (3)

 

952

 

 

943

 

 

734

 

Fleet utilization (4)

 

97.2

%

 

96.9

%

 

94.3

%

(1)

Fleet horsepower includes (x) revenue-generating horsepower and (y) idle horsepower, which is comprised of compression units that do not have a signed contract or are not subject to a firm commitment from our customer and therefore are not currently generating revenue.

(2)

Revenue-generating horsepower includes compression units that are operating under contract and generating revenue and compression units which are available to be deployed and for which we have a signed contract or are subject to a firm commitment from our customer. 

(3)

Calculated as (i) revenue-generating horsepower divided by (ii) revenue-generating compression units at period end. 

(4)

Fleet utilization is calculated as (i) revenue-generating horsepower divided by (ii) fleet horsepower. 

 
 

Full-Year 2025 Guidance 

 

Kodiak is providing revised guidance for the full year 2025. 

 

 

 

Full-Year 2025 Guidance

(in thousands, excluding percentages)

 

Low

 

High

Adjusted EBITDA (1)

 

$

700,000

 

 

$

725,000

 

Discretionary cash flow (1)(2)

 

$

445,000

 

 

$

465,000

 

 

 

 

 

 

Segment Information

 

 

 

 

Contract Services revenues

 

$

1,160,000

 

 

$

1,200,000

 

Contract Services adjusted gross margin percentage (1)

 

 

67.0

%

 

 

69.0

%

Other Services revenues

 

$

120,000

 

 

$

140,000

 

Other Services adjusted gross margin percentage (1)

 

 

14.0

%

 

 

17.0

%

 

 

 

 

 

Capital Expenditures

 

 

 

 

Maintenance capital expenditures

 

$

75,000

 

 

$

85,000

 

 

 

 

 

 

Growth capital expenditures

 

$

180,000

 

 

$

205,000

 

Other capital expenditures

 

 

60,000

 

 

 

65,000

 

Total Growth and Other capital expenditures

 

$

240,000

 

 

$

270,000

 

(1)

The Company is unable to reconcile projected adjusted EBITDA to projected net income (loss) and discretionary cash flow to projected net cash provided by operating activities and projected adjusted gross margin percentage to projected gross margin percentage, the most comparable financial measures calculated in accordance with GAAP, respectively, without unreasonable efforts because components of the calculations are inherently unpredictable, such as changes to current assets and liabilities, unknown future events, and estimating certain future GAAP measures. The inability to project certain components of the calculation would significantly affect the accuracy of the reconciliations.

(2)

Discretionary cash flow guidance assumes no change to Secured Overnight Financing Rate futures. 

 
 

Conference Call

Kodiak will conduct a conference call on Thursday, August 7, 2025, at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) to discuss financial and operating results for the quarter ended June 30, 2025. To listen to the call by phone, dial 877-407-4012 and ask for the Kodiak Gas Services call at least 10 minutes prior to the start time. To listen to the call via webcast, please visit the Investors tab of Kodiak’s website at www.kodiakgas.com.

About Kodiak

Kodiak is a leading contract compression services provider in the United States, serving as a critical link in the infrastructure that enables the safe and reliable production and transportation of natural gas and oil. Headquartered in The Woodlands, Texas, Kodiak provides contract compression and related services to oil and gas producers and midstream customers in high–volume gas gathering systems, processing facilities, multi-well gas lift applications and natural gas transmission systems. More information is available at www.kodiakgas.com.

Non-GAAP Financial Measures

Adjusted EBITDA is defined as net income (loss) before interest expense; income tax expense; and depreciation and amortization; plus (i) loss on extinguishment of debt; (ii) loss (gain) on derivatives; (iii) equity compensation expense; (iv) severance expenses; (v) transaction expenses; (vi) loss (gain) on sale of assets; and (vii) impairment of compression equipment. Adjusted EBITDA percentage is defined as adjusted EBITDA divided by total revenues. Adjusted EBITDA and adjusted EBITDA percentage are used as supplemental financial measures by our management and external users of our financial statements, such as investors, commercial banks and other financial institutions, to assess: (i) the financial performance of our assets without regard to the impact of financing methods, capital structure or historical cost basis of our assets; (ii) the viability of capital expenditure projects and the overall rates of return on alternative investment opportunities; (iii) the ability of our assets to generate cash sufficient to make debt payments and pay dividends; and (iv) our operating performance as compared to those of other companies in our industry without regard to the impact of financing methods and capital structure. We believe adjusted EBITDA and adjusted EBITDA percentage provide useful information because, when viewed with our GAAP results and the accompanying reconciliation, they provide a more complete understanding of our performance than GAAP results alone. We also believe that external users of our financial statements benefit from having access to the same financial measures that management uses in evaluating the results of our business. Reconciliations of adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, and net cash provided by operating activities are presented below.

Adjusted gross margin is defined as revenue less cost of operations, exclusive of depreciation and amortization expense. Adjusted gross margin percentage is defined as adjusted gross margin divided by total revenues. We believe adjusted gross margin and adjusted gross margin percentage are useful as supplemental measures to investors of our operating profitability. Reconciliations of adjusted gross margin to gross margin are presented below.

Discretionary cash flow is defined as net cash provided by operating activities less (i) maintenance capital expenditures; (ii) certain changes in operating assets and liabilities; and (iii) certain other expenses; plus (w) cash loss on extinguishment of debt; (x) severance expenses; and (y) transaction expenses. We believe discretionary cash flow is a useful liquidity and performance measure and supplemental financial measure for us in assessing our ability to pay cash dividends to our stockholders, make growth capital expenditures and assess our operating performance. A reconciliation of discretionary cash flow to net cash provided by operating activities is presented below.

Free cash flow is defined as net cash provided by operating activities less (i) maintenance capital expenditures; (ii) certain changes in operating assets and liabilities; (iii) certain other expenses; and (iv) growth and other capital expenditures; plus (w) cash loss on extinguishment of debt; (x) severance expenses; (y) transaction expenses; and (z) proceeds from sale of assets. We believe free cash flow is a liquidity measure and useful supplemental financial measure for us in assessing our ability to pursue business opportunities and investments to grow our business and to service our debt. A reconciliation of free cash flow to net cash provided by operating activities is presented below.

Cautionary Note Regarding Forward-Looking Statements

This news release contains, and our officers and representatives may from time to time make, “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding: (i) expected operating results, such as revenue growth and earnings, including upon the continued integration of CSI Compressco LP (“CSI Compressco”) into our operations, and our ability to service our indebtedness; (ii) anticipated levels of capital expenditures and uses of capital; (iii) current or future volatility in the credit markets and future market conditions; (iv) potential or pending acquisition transactions or other strategic transactions, the timing thereof, the receipt of necessary approvals to close such acquisitions, our ability to finance such acquisitions, and our ability to achieve the intended operational, financial, and strategic benefits from any such transactions; (v) expectations of the effect on our financial condition of claims, litigation, environmental costs, contingent liabilities and governmental and regulatory investigations and proceedings; (vi) production and capacity forecasts for the natural gas and oil industry; (vii) strategy for customer retention, growth, fleet maintenance, market position and financial results; (viii) our interest rate hedges; and (ix) strategy for risk management.

Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) a reduction in the demand for natural gas and oil and/or a decrease in natural gas and oil prices; (ii) the loss of, or the deterioration of the financial condition of, any of our key customers; (iii) nonpayment and nonperformance by our customers, suppliers or vendors; (iv) competitive pressures that may cause us to lose market share; (v) the structure of our Contract Services contracts and the failure of our customers to continue to contract for services after expiration of the primary term; (vi) our ability to successfully integrate any acquired businesses, including CSI Compressco, and realize the expected benefits thereof in the expected timeframe or at all; (vii) our ability to fund purchases of additional compression equipment; (viii) our ability to successfully implement our share repurchase program; (ix) a deterioration in general economic, business, geopolitical or industry conditions, including as a result of the conflict between Russia and Ukraine, the Israel-Hamas war, and the hostilities in the Middle East, inflation, and slow economic growth in the United States; (x) a downturn in the economic environment, as well as continued inflationary pressures; (xi) international operations and related mobilization and demobilization of compression units, operational interruptions, delays, upgrades, refurbishment and repair of compression assets and any related delays and costs overruns or reduced payment of contracted rates; (xii) our ability to successfully manage our international operations and comply with any applicable laws and regulations, including risks associated with doing business in foreign countries, and our ability to comply with the U.S. Foreign Corrupt Practices Act (“FCPA”) or other anti-corruption laws; (xiii) the outcome of any pending internal review or any future related government enforcement actions; (xiv) tax legislation and the impact of changes to applicable tax laws, including the passage of the One Big Beautiful Bill Act, and administrative initiatives or challenges to our tax positions; (xv) the loss of key management, operational personnel or qualified technical personnel; (xvi) our dependence on a limited number of suppliers; (xvii) the cost of compliance with existing and new governmental regulations, as well as the associated uncertainty given the new U.S. federal government administration; (xviii) changes in trade policies and regulations, including increases or changes in duties, current and potentially new tariffs and other actions; (xix) the cost of compliance with regulatory initiatives and stakeholders’ pressures, including sustainability and corporate responsibility; (xx) the inherent risks associated with our operations, such as equipment defects and malfunctions; (xxi) our reliance on third-party components for use in our IT systems; (xxii) legal and reputational risks and expenses relating to the privacy, use and security of employee and client information; (xxiii) threats of cyber-attacks or terrorism; (xxiv) agreements that govern our debt contain features that may limit our ability to operate our business and fund future growth and also increase our exposure to risk during adverse economic conditions; (xxv) volatile and/or elevated interest rates and associated central bank policy actions; (xxvi) our ability to access the capital and credit markets or borrow on affordable terms (or at all) to obtain additional capital that we may require; (xxvii) major natural disasters, severe weather events or other similar events that could disrupt operations; (xxviii) unionization of our labor force, labor interruptions and new or amended labor regulations; (xxix) renewal of insurance; (xxx) the effectiveness of our disclosure controls and procedures; and (xxxi) such other factors as discussed throughout the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the U.S. Securities and Exchange Commission.(“SEC”) on March 7, 2025, as may be updated by subsequent filings under the Securities Exchange Act of 1934, as amended, including Forms 10-Q and 8-K, each of which can be obtained free of charge on the SEC’s website at http://www.sec.gov.

Any forward-looking statement made by us in this news release is based only on information currently available to us and speaks only as of the date on which it is made. Except as may be required by applicable law, we undertake no obligation to publicly update any forward-looking statement whether as a result of new information, future developments or otherwise.

 
 
 

KODIAK GAS SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
 

 

 

 

Three Months Ended

(in thousands, except per share data)

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Revenues:

 

 

 

 

 

 

Contract Services

 

$

293,534

 

 

$

288,956

 

 

$

276,250

 

Other Services

 

 

29,309

 

 

 

40,686

 

 

 

33,403

 

Total revenues

 

 

322,843

 

 

 

329,642

 

 

 

309,653

 

Operating expenses:

 

 

 

 

 

 

Cost of operations (exclusive of depreciation and amortization shown below):

 

 

 

 

 

 

Contract Services

 

 

93,137

 

 

 

93,235

 

 

 

99,333

 

Other Services

 

 

22,114

 

 

 

35,226

 

 

 

27,936

 

Depreciation and amortization

 

 

66,135

 

 

 

70,529

 

 

 

69,463

 

Selling, general and administrative

 

 

35,121

 

 

 

32,255

 

 

 

59,927

 

Loss (gain) on sale of assets

 

 

6,606

 

 

 

9,211

 

 

 

(1,173

)

Total operating expenses

 

 

223,113

 

 

 

240,456

 

 

 

255,486

 

Income from operations

 

 

99,730

 

 

 

89,186

 

 

 

54,167

 

Other income (expenses):

 

 

 

 

 

 

Interest expense

 

 

(45,755

)

 

 

(47,224

)

 

 

(52,133

)

Gain on derivatives

 

 

 

 

 

 

 

 

6,797

 

Other income (expense), net

 

 

(546

)

 

 

(402

)

 

 

218

 

Total other expenses, net

 

 

(46,301

)

 

 

(47,626

)

 

 

(45,118

)

Income before income taxes

 

 

53,429

 

 

 

41,560

 

 

 

9,049

 

Income tax expense

 

 

13,445

 

 

 

10,524

 

 

 

2,336

 

Net income

 

 

39,984

 

 

 

31,036

 

 

 

6,713

 

Less: Net income attributable to noncontrolling interests

 

 

488

 

 

 

625

 

 

 

485

 

Net income attributable to common shareholders

 

$

39,496

 

 

$

30,411

 

 

$

6,228

 

 

 

 

 

 

 

 

Earnings per share attributable to common shareholders:

 

 

 

 

 

 

Basic

 

$

0.44

 

 

$

0.34

 

 

$

0.07

 

Diluted

 

$

0.43

 

 

$

0.33

 

 

$

0.06

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

Basic

 

 

87,699

 

 

 

87,879

 

 

 

84,202

 

Diluted

 

 

90,040

 

 

 

90,606

 

 

 

90,669

 

 
 
 
 

KODIAK GAS SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
 

 

(in thousands)

 

June 30, 2025

 

December 31, 2024

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

5,428

 

 

$

4,750

 

Accounts receivable, net

 

 

224,656

 

 

 

253,637

 

Inventories, net

 

 

101,004

 

 

 

103,341

 

Fair value of derivative instruments

 

 

 

 

 

3,672

 

Contract assets

 

 

5,274

 

 

 

7,575

 

Prepaid expenses and other current assets

 

 

9,163

 

 

 

10,686

 

Total current assets

 

 

345,525

 

 

 

383,661

 

Property, plant and equipment, net

 

 

3,392,339

 

 

 

3,395,022

 

Operating lease right-of-use assets, net

 

 

47,866

 

 

 

53,754

 

Finance lease right-of-use assets, net

 

 

7,574

 

 

 

5,696

 

Goodwill

 

 

415,213

 

 

 

415,213

 

Identifiable intangible assets, net

 

 

158,999

 

 

 

162,747

 

Fair value of derivative instruments

 

 

6,978

 

 

 

17,544

 

Other assets

 

 

1,433

 

 

 

1,486

 

Total assets

 

$

4,375,927

 

 

$

4,435,123

 

Liabilities and Stockholders’ Equity

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

50,385

 

 

$

57,562

 

Accrued liabilities

 

 

178,541

 

 

 

188,732

 

Contract liabilities

 

 

84,392

 

 

 

73,075

 

Total current liabilities

 

 

313,318

 

 

 

319,369

 

Long-term debt, net of unamortized debt issuance cost

 

 

2,545,019

 

 

 

2,581,909

 

Operating lease liabilities

 

 

43,735

 

 

 

49,748

 

Finance lease liabilities

 

 

5,394

 

 

 

3,514

 

Deferred tax liabilities

 

 

118,087

 

 

 

103,826

 

Other liabilities

 

 

1,908

 

 

 

3,150

 

Total liabilities

 

$

3,027,461

 

 

$

3,061,516

 

Stockholders’ equity:

 

 

 

 

Preferred stock

 

 

8

 

 

 

9

 

Common stock

 

 

895

 

 

 

892

 

Additional paid-in capital

 

 

1,317,475

 

 

 

1,305,375

 

Treasury stock, at cost

 

 

(59,956

)

 

 

(40,000

)

Noncontrolling interest

 

 

12,347

 

 

 

13,694

 

Accumulated other comprehensive loss

 

 

(8,316

)

 

 

 

Retained earnings

 

 

86,013

 

 

 

93,637

 

Total stockholders’ equity

 

 

1,348,466

 

 

 

1,373,607

 

Total liabilities and stockholders’ equity

 

$

4,375,927

 

 

$

4,435,123

 

 
 
 
 

KODIAK GAS SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
 

 

 

Six Months Ended June 30,

(in thousands)

 

2025

 

 

 

2024

 

Cash flows from operating activities:

 

 

 

Net income

$

71,020

 

 

$

36,945

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

136,664

 

 

 

116,407

 

Equity compensation expense

 

13,269

 

 

 

8,159

 

Amortization of debt issuance costs

 

6,267

 

 

 

4,946

 

Non-cash lease expense

 

6,265

 

 

 

1,648

 

Provision for credit losses

 

995

 

 

 

4,589

 

Inventory reserve

 

123

 

 

 

476

 

Loss (gain) on sale of assets

 

15,817

 

 

 

(1,173

)

Change in fair value of derivatives

 

 

 

 

(14,293

)

Amortization of interest rate swap

 

4,147

 

 

 

 

Deferred tax provision

 

17,134

 

 

 

7,104

 

Changes in operating assets and liabilities, exclusive of effects of business acquisition:

 

 

 

Accounts receivable

 

27,986

 

 

 

(45,933

)

Inventories

 

2,214

 

 

 

(3,147

)

Contract assets

 

2,301

 

 

 

12,000

 

Prepaid expenses and other current assets

 

1,380

 

 

 

4,671

 

Accounts payable

 

(13,162

)

 

 

21,983

 

Accrued and other liabilities

 

(13,334

)

 

 

11,871

 

Contract liabilities

 

11,317

 

 

 

6,308

 

Other assets

 

1,097

 

 

 

63

 

Net cash provided by operating activities

 

291,500

 

 

 

172,624

 

Cash flows from investing activities:

 

 

 

Net cash acquired in acquisition of CSI Compressco LP

 

 

 

 

9,458

 

Purchase of property, plant and equipment

 

(160,171

)

 

 

(177,186

)

Proceeds from sale of assets

 

17,606

 

 

 

411

 

Other

 

 

 

 

(35

)

Net cash used for investing activities

 

(142,565

)

 

 

(167,352

)

Cash flows from financing activities:

 

 

 

Borrowings on debt instruments

 

686,921

 

 

 

1,945,775

 

Payments on debt instruments

 

(730,078

)

 

 

(1,867,851

)

Principal payments on other borrowings

 

(3,455

)

 

 

(1,843

)

Payment of debt issuance cost

 

 

 

 

(16,346

)

Principal payments on finance leases

 

(1,540

)

 

 

(408

)

Offering costs

 

 

 

 

(1,162

)

Dividends paid to stockholders

 

(76,593

)

 

 

(62,393

)

Repurchase of common shares

 

(19,956

)

 

 

 

Cash paid for shares withheld to cover taxes

 

(3,286

)

 

 

(294

)

Net effect on deferred taxes and taxes payable related to the vesting of restricted stock

 

424

 

 

 

 

Distributions to noncontrolling interest

 

(694

)

 

 

(2,460

)

Net cash used for financing activities

 

(148,257

)

 

 

(6,982

)

Net increase (decrease) in cash and cash equivalents

 

678

 

 

 

(1,710

)

Cash and cash equivalents - beginning of period

 

4,750

 

 

 

5,562

 

Cash and cash equivalents - end of period

$

5,428

 

 

$

3,852

 

 
 
 
 

KODIAK GAS SERVICES, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(UNAUDITED)
 

 

 

 

Three Months Ended

(in thousands, excluding percentages)

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Net income

 

$

39,984

 

 

$

31,036

 

 

$

6,713

 

Interest expense

 

 

45,755

 

 

 

47,224

 

 

 

52,133

 

Income tax expense

 

 

13,445

 

 

 

10,524

 

 

 

2,336

 

Depreciation and amortization

 

 

66,135

 

 

 

70,529

 

 

 

69,463

 

Gain on derivatives

 

 

 

 

 

 

 

 

(6,797

)

Equity compensation expense

 

 

6,291

 

 

 

6,978

 

 

 

5,311

 

Severance expense (1)

 

 

 

 

 

376

 

 

 

8,969

 

Transaction expenses (2)

 

 

 

 

 

1,786

 

 

 

17,387

 

Loss (gain) on sale of assets

 

 

6,606

 

 

 

9,211

 

 

 

(1,173

)

Adjusted EBITDA

 

$

178,216

 

 

$

177,664

 

 

$

154,342

 

 

 

 

 

 

 

 

Net income percentage

 

 

12.4

%

 

 

9.4

%

 

 

2.2

%

Adjusted EBITDA percentage

 

 

55.2

%

 

 

53.9

%

 

 

49.8

%

(1)

Represents severance expense related to the CSI Acquisition.

(2)

Represents certain costs associated with non-recurring professional services and other costs, primarily related to the CSI Acquisition and secondary offerings.

 
 
 
 

KODIAK GAS SERVICES, INC.
RECONCILIATION OF ADJUSTED GROSS MARGIN TO GROSS MARGIN
(UNAUDITED)
 

 

Contract Services 

 

 

 

Three Months Ended

(in thousands, excluding percentages)

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Total revenues

 

$

293,534

 

 

$

288,956

 

 

$

276,250

 

Cost of operations (excluding depreciation and amortization)

 

 

(93,137

)

 

 

(93,235

)

 

 

(99,333

)

Depreciation and amortization

 

 

(66,135

)

 

 

(70,529

)

 

 

(69,463

)

Gross margin

 

$

134,262

 

 

$

125,192

 

 

$

107,454

 

Gross margin percentage

 

 

45.7

%

 

 

43.3

%

 

 

38.9

%

Depreciation and amortization

 

 

66,135

 

 

 

70,529

 

 

 

69,463

 

Adjusted gross margin

 

$

200,397

 

 

$

195,721

 

 

$

176,917

 

Adjusted gross margin percentage

 

 

68.3

%

 

 

67.7

%

 

 

64.0

%

 

Other Services 

 

 

Three Months Ended

(in thousands, excluding percentages)

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Total revenues

 

$

29,309

 

 

$

40,686

 

 

$

33,403

 

Cost of operations (excluding depreciation and amortization)

 

 

(22,114

)

 

 

(35,226

)

 

 

(27,936

)

Depreciation and amortization

 

 

 

 

 

 

 

 

 

Gross margin

 

$

7,195

 

 

$

5,460

 

 

$

5,467

 

Gross margin percentage

 

 

24.5

%

 

 

13.4

%

 

 

16.4

%

Depreciation and amortization

 

 

 

 

 

 

 

 

 

Adjusted gross margin

 

$

7,195

 

 

$

5,460

 

 

$

5,467

 

Adjusted gross margin percentage

 

 

24.5

%

 

 

13.4

%

 

 

16.4

%

 
 
 
 

KODIAK GAS SERVICES, INC.
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO DISCRETIONARY CASH FLOW AND FREE CASH FLOW
(UNAUDITED)
 

 

 

 

Three Months Ended

(in thousands)

 

June 30, 2025

 

March 31, 2025

 

June 30, 2024

Net cash provided by operating activities

 

$

177,172

 

 

$

114,328

 

 

$

121,082

 

Maintenance capital expenditures

 

 

(17,565

)

 

 

(16,407

)

 

 

(19,147

)

Severance expense (1)

 

 

 

 

 

376

 

 

 

8,969

 

Transaction expenses (2)

 

 

 

 

 

1,786

 

 

 

17,387

 

Change in operating assets and liabilities

 

 

(38,478

)

 

 

18,679

 

 

 

(32,372

)

Other (3)

 

 

(4,705

)

 

 

(2,678

)

 

 

(5,302

)

Discretionary cash flow

 

$

116,424

 

 

$

116,084

 

 

$

90,617

 

Growth capital expenditures (4)(5)

 

 

(37,966

)

 

 

(55,983

)

 

 

(77,257

)

Other capital expenditures (4)

 

 

(16,398

)

 

 

(22,258

)

 

 

(13,133

)

Proceeds from sale of assets

 

 

8,230

 

 

 

9,376

 

 

 

411

 

Free cash flow

 

$

70,290

 

 

$

47,219

 

 

$

638

 

(1)

Represents severance expense related to the CSI Acquisition.

(2)

Represents certain costs associated with non-recurring professional services and other costs, primarily related to the CSI Acquisition and secondary offerings. 

(3)

Includes non-cash lease expense, provision for credit losses and inventory reserve. 

(4)

For the three months ended June 30, 2025, March 31, 2025, and June 30, 2024, growth and other capital expenditures includes a $10.7 million decrease, a $14.1 million increase and a $12.6 million decrease in accrued capital expenditures, respectively. 

(5)

For the three months ended June 30, 2025, March 31, 2025, and June 30, 2024, growth capital expenditures includes a $0.3 million decrease, a $1.2 million increase and a $19.8 million increase, in a non-cash sales tax accrual on compression equipment purchases, respectively. These accrual amounts are estimated based on the best-known information as it relates to open audit periods with the State of Texas. 

 
 

 

Investor Contact
Graham Sones, VP – Investor Relations
ir@kodiakgas.com
(936) 755-3529

Source: Kodiak Gas Services, Inc.