Archrock, Inc. reported significant financial growth for the fiscal year ending December 31, 2024, with total revenue reaching $1.16 billion, a 17% increase from $990.3 million in 2023. The company's net income also rose to $172.2 million, compared to $105 million in the previous year, driven primarily by higher adjusted gross margins from its contract operations segment. This segment accounted for approximately 85% of total revenue, reflecting a 21% increase in revenue to $980.4 million, attributed to higher rates and an increase in average operating horsepower, as well as contributions from the recent acquisition of TOPS.
The year saw Archrock complete the acquisition of TOPS on August 30, 2024, for a total consideration of approximately $1.01 billion, which included cash and stock. This acquisition added a fleet of approximately 580,000 horsepower to Archrock's operations, enhancing its capacity in the natural gas compression market. Additionally, the company executed a tender offer for $202 million of its 2027 Notes, which was part of a broader strategy to manage its debt and optimize its capital structure.
Operationally, Archrock reported a total operating horsepower of 4,227, a 17% increase from the previous year, with an average utilization rate of 95%. The company served approximately 280 customers across major U.S. natural gas and crude oil producing regions, maintaining a diversified geographic footprint. Employee headcount stood at approximately 1,300, reflecting the company's commitment to expanding its workforce to support growth initiatives.
Looking ahead, Archrock anticipates continued demand for its services, driven by expected increases in U.S. natural gas production and consumption. The Energy Information Administration (EIA) forecasts a 2% growth in natural gas production for 2025 and 2026, alongside a significant rise in liquefied natural gas exports. However, the company acknowledges potential challenges, including labor shortages, rising operational costs, and the impact of regulatory changes related to emissions and environmental standards. Archrock remains focused on leveraging its competitive strengths and technological advancements to enhance operational efficiency and profitability in the evolving energy landscape.
About Archrock, Inc.
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