Archrock, Inc. Files 2023 10-K Report

TL;DR

<b>Archrock, Inc. has submitted its 2023 10-K annual report detailing its financial performance and operational status.</b>

AI Summary

Archrock, Inc. (AROC) filed a Annual Report (10-K) with the SEC on February 21, 2024. Archrock, Inc. filed its annual 10-K report for the fiscal year ending December 31, 2023. The filing covers the company's operations and financial performance for the year. Key financial data and disclosures are included in the report. The company's business address is 9807 Katy Freeway, Suite 100, Houston, TX 77024. Archrock, Inc. was formerly known as Exterran Holdings Inc. and Iliad Holdings, INC.

Why It Matters

For investors and stakeholders tracking Archrock, Inc., this filing contains several important signals. This 10-K filing provides a comprehensive overview of Archrock's financial health and strategic direction for investors and stakeholders. Understanding the details within this report is crucial for assessing the company's performance in the natural gas transmission sector and its future prospects.

Risk Assessment

Risk Level: medium — Archrock, Inc. shows moderate risk based on this filing. The filing is a standard 10-K, which is a routine disclosure for public companies, but the specific financial details and risk factors within will determine the overall risk level.

Analyst Insight

Review the detailed financial statements and risk factors in the 10-K to assess Archrock's performance and potential investment risks.

Key Numbers

• 2023-12-31 — Fiscal Year End (Report period)
• 2024-02-21 — Filing Date (Date of submission)

Key Players & Entities

• Archrock, Inc. (company) — Filer name
• AROC (company) — Ticker symbol
• Exterran Holdings Inc. (company) — Former company name
• Iliad Holdings, INC (company) — Former company name
• 9807 Katy Freeway, Suite 100, Houston, TX 77024 (company) — Business address

FAQ

Industry Context

Archrock, Inc. operates in the natural gas transmission industry, providing essential services for the transportation of natural gas.

Regulatory Implications

As a publicly traded company, Archrock, Inc. is subject to the reporting requirements of the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934.

What Investors Should Do

1. Analyze Archrock's financial statements for the fiscal year 2023.
2. Review the risk factors section for potential business and market risks.
3. Compare Archrock's performance against industry benchmarks and previous years.

Key Dates

• 2023-12-31: Fiscal Year End — End of the reporting period for the 10-K.
• 2024-02-21: Filing Date — Date the 10-K was officially filed with the SEC.

Year-Over-Year Comparison

This is the 2023 10-K filing, which provides the latest annual financial and operational data for Archrock, Inc.

Key Financial Figures

• $0.01 — ge on which registered Common Stock , $0.01 par value per share AROC New York S
• $50.0 million — 2023 that allows us to repurchase up to $50.0 million of outstanding common stock until April
• $500.0 million — stock until April 27, 2024 2027 Notes $500.0 million of 6.875% senior notes due April 2027
• $800.0 million — enior notes due April 2027 2028 Notes $800.0 million of 6.25% senior notes due April 2028 A
• $750.0 million — ion on Climate Change Credit Facility $750.0 million asset-based revolving credit facility d

Filing Documents

• aroc-20231231x10k.htm (10-K) — 3026KB
• aroc-20231231xex21d1.htm (EX-21.1) — 67KB
• aroc-20231231xex23d1.htm (EX-23.1) — 4KB
• aroc-20231231xex31d1.htm (EX-31.1) — 17KB
• aroc-20231231xex31d2.htm (EX-31.2) — 17KB
• aroc-20231231xex32d1.htm (EX-32.1) — 11KB
• aroc-20231231xex32d2.htm (EX-32.2) — 11KB
• aroc-20231231xex97d1.htm (EX-97.1) — 81KB
• aroc-20231231x10k003.jpg (GRAPHIC) — 40KB
• aroc-20231231xex97d1002.jpg (GRAPHIC) — 5KB
• 0001389050-24-000007.txt (&nbsp;) — 14578KB
• aroc-20231231.xsd (EX-101.SCH) — 97KB
• aroc-20231231_cal.xml (EX-101.CAL) — 110KB
• aroc-20231231_def.xml (EX-101.DEF) — 396KB
• aroc-20231231_lab.xml (EX-101.LAB) — 825KB
• aroc-20231231_pre.xml (EX-101.PRE) — 692KB
• aroc-20231231x10k_htm.xml (XML) — 2867KB

Forward-Looking Statements

Forward-Looking Statements 5 Part I

Business

Item 1. Business 6

Risk Factors

Item 1A. Risk Factors 18

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 31

Cybersecurity

Item 1C. Cybersecurity 32

Properties

Item 2. Properties 34

Legal Proceedings

Item 3. Legal Proceedings 34

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 34 Part II

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 34

[Reserved]

Item 6. [Reserved] 36

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 36

Quantitative and Qualitative Disclosures About Market Risk

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 48

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 48

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 48

Controls and Procedures

Item 9A. Controls and Procedures 48

Other Information

Item 9B. Other Information 51

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 51 Part III

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 51

Executive Compensation

Item 11. Executive Compensation 51

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 51

Certain Relationships and Related Transactions and Director Independence

Item 13. Certain Relationships and Related Transactions and Director Independence 52

Principal Accountant Fees and Services

Item 14. Principal Accountant Fees and Services 52 Part IV

Exhibits and Financial Statement Schedules

Item 15. Exhibits and Financial Statement Schedules 52

Signatures

Signatures 57 2 Table Archrock, Contents GLOSSARY The following terms and abbreviations appearing in the text of this report, including the Financial Statements, have the meanings indicated below. 2013 Plan 2013 Stock Incentive Plan 2020 Plan 2020 Stock Incentive Plan 2023 Form 10–K Annual Report on Form 10–K for the year ended December 31, 2023 2023 Share Repurchase Program Share repurchase program approved by our Board of Directors on April 27, 2023 that allows us to repurchase up to $50.0 million of outstanding common stock until April 27, 2024 2027 Notes $500.0 million of 6.875% senior notes due April 2027 2028 Notes $800.0 million of 6.25% senior notes due April 2028 Amended and Restated Credit Agreement Amended and Restated Credit Agreement, dated May 16, 2023, which amended and restated that Credit Agreement, dated as of March 30, 2017, and which governs the Credit Facility AMNAX Alerian Midstream Energy Index AMZ Alerian MLP Index Archrock, our, we, us Archrock, Inc., individually and together with its wholly–owned subsidiaries ARRC Alternative Reference Rates Committee ASU Accounting Standards Update ATM Agreement Equity Distribution Agreement, dated February 23, 2021, entered into with Wells Fargo Securities, LLC and BofA Securities, Inc., as sales agents, relating to the at–the–market offer and sale of shares of our common stock from time to time Bcf/d Billion cubic feet per day BoLM U.S. Department of the Interior's Bureau of Land Management CAA Clean Air Act CERCLA Comprehensive Environmental Response, Compensation, and Liability Act CIS CSC Center for Internal Security Critical Security Controls CISSP Certified Information Systems Security Professional Code Internal Revenue Code of 1986, as amended Congress The United States Congress is the legislature of the federal government of the United States, composed of a lower body, the House of Representatives, and an upper body, the Senate COP28 28th Conf

Financial Statements

Financial Statements Consolidated financial statements included in Part IV Item 15 of this 2023 Form 10–K GAAP Accounting principles generally accepted in the U.S. GHG Greenhouse gases (carbon dioxide, methane and water vapor for example) Hilcorp Hilcorp Energy Company Ionada Ionada PLC IRS Internal Revenue Service IT Information Technology LIBOR London Interbank Offered Rate LNG Liquified natural gas MMb/d Million barrels per day NAAQS National Ambient Air Quality Standards NOL Net operating loss NSPS New Source Performance Standards OECD Organisation for Economic Co-operation and Development OOOOb and OOOOc Subpart of the NSPS commonly referred to as the EPA's methane rule for new and existing sources OSHA Occupational Safety and Health Act OTC Over–the–counter, as related to aftermarket services parts and components Paris Agreement Resulting agreement of the 21st Conference of the Parties of the United Nations Framework Convention on Climate Change held in Paris, France POTUS President of the United States of America ppb Parts per billion Prime Rate Rate of interest last quoted by The Wall Street Journal as the prime rate in the U.S. RCRA Resource Conservation and Recovery Act ROU Right–of–use, as related to operating leases S&P 500 S&P 500 Composite Stock Price Index SEC U.S. Securities and Exchange Commission SG&A Selling, general and administrative SOFR Secured Overnight Financing Rate Spin–off Spin–off of our international contract operations, international aftermarket services and global fabrication businesses, completed in November 2015 into a standalone public company operating as Exterran Corporation U.S. United States of America VOC Volatile organic compounds WACC Weighted average cost of capital 4 Table Archrock, Contents FORWARD–LOOKING STATEMENTS This 2023 Form 10–K contains "forward–looking statements" intended to qualify for the safe harbors from liability established by the Private S

Business

Item 1. Business We were incorporated in February 2007 as a wholly–owned subsidiary of Universal Compression Holdings, Inc. In August 2007, Universal Compression Holdings, Inc. and Hanover Compressor Company merged into our wholly–owned subsidiaries and we became Exterran Holdings, Inc., the parent entity of Universal Compression Holdings, Inc. and Hanover Compressor Company. In November 2015, we completed the spin–off of our international contract operations, international aftermarket services and global fabrication business into a standalone public company operating as Exterran Corporation, and we were renamed "Archrock, Inc." We are an energy infrastructure company with a primary focus on midstream natural gas compression and a commitment to helping our customers produce, compress and transport natural gas in a safe and environmentally responsible way. We are the leading provider of natural gas compression services to customers in the energy industry throughout the U.S., in terms of total compression fleet horsepower, and a leading supplier of aftermarket services to customers that own compression equipment in the U.S. Our business supports a must–run service that is essential to the production, processing, transportation and storage of natural gas. Our mission to help our customers deliver natural gas, an affordable and cleaner energy source, to a variety of critical industries, to generate electricity and to directly heat and power our homes, is more critical than ever. We operate in two business segments: Contract Operations – Our contract operations business is comprised of our owned fleet of natural gas compression equipment that we use to provide operations services to our customers. Aftermarket Services – Our aftermarket services business provides a full range of services to support the compression needs of our customers that own compression equipment, including operations, maintenance, overhaul and reconfiguration services and sales of parts and comp

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View this 10-K filing on SEC EDGAR