Cordy Reports Third Quarter and Year to Date Results
November 09 2012 - 2:52PM
Marketwired Canada
CORDY OILFIELD SERVICES INC. (the "Corporation" or "Cordy") (TSX VENTURE:CKK)
released today its third quarter results for the period ending September 30,
2012.
For the nine months ended September 30, 2012, Cordy reported revenue from
continuing operations of $86.5 million, $22.9 million higher than the $63.6
million achieved in the same period of 2011. Earnings before interest, taxes,
depreciation, amortization, impairment and stock-based compensation (EBITDAS)
were $8.3 million in the nine months ended September 30, 2012 compared to $7.5
million during the comparable period in 2011. Cordy generated net earnings from
continuing operations of $1.5 million for the nine months ended September 30,
2012 compared to $3.2 million for the same period in 2011. Additionally, Cordy
had a net loss from discontinued operations of $0.1 million for the nine months
ended September 30, 2012 compared to a net loss of $2.4 million for the
comparative period of 2011. Overall, the Corporation's nine months ended
September 30, 2012 performance remained positive with $1.4 million in net
earnings from all operations, from net earnings from all operations of $0.7
million in the comparative period in 2011.
For the third quarter of 2012, Cordy's revenue from continuing operations was
$33.7 million, $10.2 million higher than the $23.5 million achieved in the same
period in 2011. EBITDAS was $4.3 million in the three months ended September 30,
2012 compared to $3.3 million in EBITDAS during the comparable period in 2011.
Cordy generated third quarter net earnings from continuing operations of $1.3
million compared net earnings from continuing operations of $1.5 million for the
comparative period in 2011. Additionally, Cordy incurred a third quarter net
loss from discontinued operations of $0.1 million compared to a net loss of $1.1
million for the comparative period in 2011. Overall, the Corporation's third
quarter performance resulted in net earnings of $1.2 million from all
operations, an increase from the net earnings from all operations of $0.4
million during the comparative period in 2011.
SUBSEQUENT EVENTS
Subsequent to the end of the third quarter, on October 24, 2012, Cordy closed an
amended agreement for a Senior Secured Demand Operating Facility (the
"Facility"). The Facility is subject to the same financial covenants as required
under the previous agreement; however, the maximum available borrowing was
increased from $7.5 million to $15 million under the amended agreement.
For the quarters ended September 30
($ millions except
share price and per Q3 YTD Q3 YTD
share amounts) Q3 2012 Q3 2011 $ Change 2012 2011 $ Change
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FINANCIAL RESULTS
Revenue 33.7 23.5 10.2 86.5 63.6 22.9
EBITDAS(1) 4.3 3.3 1.0 8.3 7.5 0.8
Net earnings and total
comprehensive income
from all operations 1.2 0.4 0.8 1.4 0.7 0.7
Cash flows generated
from (used in)
operating activities
from all operations (0.2) 0.5 (0.7) 5.1 (0.7) 5.8
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SHARE INFORMATION
Earnings per share
from continuing
operations ($) 0.01 0.02 (0.01) 0.02 0.04 (0.02)
Earnings per share
from discontinued
operations ($) - (0.01) 0.01 - (0.03) 0.03
Earnings per share
from all operations
($) 0.01 - 0.01 0.02 0.01 0.01
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(1) Earnings before interest, taxes, depreciation, amortization, impairment and
share-based payments (see reader advisory).
OUTLOOK
Management is approaching the remainder of 2012 purposefully and cautiously. The
Corporation is dependent, to a degree, on the overall health of western Canada's
oil, natural gas, and mining sectors. The current global economic activity and
resulting activity in western Canada are subdued and are anticipated to remain
so throughout the remainder of 2012.
Management has organized its business segments to provide diversity.
Historically these business segments have had stronger first and fourth
quarters. While the first quarter of 2012 was strong, current market conditions
and industry activity levels indicate that the fourth quarter is not likely to
be as strong as originally anticipated.
There is a current trend towards curtailing spending within the oil, natural gas
and mining sectors in western Canada. The expecta- tion within the industry is
that operators will continue to hold or slightly reduce activities from current
levels to stay within their operating and capital budgets for the remainder of
2012. This is evidenced by the comparative decline in rig count by approxi-
mately 27% as at September 30, 2012 versus 2011. Similar trends are also being
noted in other market sectors such as the mining industry which is reacting to
the volatility in the pricing of coal as of the end of the third quarter of
2012. The expectation of lower activity levels is likely to impact the
Corporation's Heavy Construction, Pipeline and Facilities, and Manufacturing and
Supply segments (3 of the 4 segments). During the third quarter of 2012 Cordy
increased its environmental equipment fleet and antici- pates that the
utilization of this equipment will increase during the fourth quarter of 2012.
Overall, management anticipate the current market factors will result in similar
or lower consolidated revenues and incrementally lower operating earnings in the
fourth quarter of 2012 compared to 2011.
Management continues to seek opportunities to expand Cordy's operations in
regions where its business segments operate. Management is confident that the
Corporation will remain committed to delivering results to shareholders that
build on the gains achieved from previous initiatives.
Complete copies of Cordy's consolidated financial statements for the quarter
ended June 30, 2012 and the associated Management's Discussion and Analysis are
available on our website www.cordy.ca or on SEDAR at www.sedar.com.
READER ADVISORY
Effective January 1, 2011, Cordy began reporting its financial results in
accordance with International Financial Reporting Standards (IFRS). Prior-year's
comparative amounts were changed to reflect results as if Cordy had always
prepared its financial results using IFRS.
This News Release contains certain statements that constitute forward-looking
statements. These statements relate to future events or the Corporation's future
performance. All statements, other than statements of historical fact, that
address activities, events or developments that the Corporation or a third party
expects or anticipates will or may occur in the future, are forward-looking
statements. These include the Corporation's future growth, results of
operations, performance and business prospects and opportunities; prevailing
economic conditions; commodity prices; sourcing, pricing and availability of raw
materials, components and parts, equipment, suppliers, facilities and skilled
personnel; dependence on major customers; uncertainties in weather and
temperature affecting the duration of the service periods and the activities
that can be completed; regional competition; and other factors, many of which
are beyond the Corporation's control. These other factors include future prices
of oil and natural gas and oil and natural gas industry activity, including the
effect of changes in commodity prices on oil and natural gas exploration and
development activity, the ability to complete strategic acquisitions and realize
the anticipated benefits of any acquisitions that are completed, the
Corporation's outlook regarding the competitive environment it operates in, and
the assumptions underlying any of the foregoing. Forward-looking statements are
often, but not always, identified by the use of words such as "seek",
"anticipate", "plan", "continue", "estimate", "expect", "may", "will",
"project", "predict", "potential", "targeting", "intend", "could", "might",
"should", "believe" and similar expressions. These statements involve known and
unknown risks, uncertainties and other factors, many of which are beyond the
Corporation's control, including those discussed under "Risks and Uncertainties"
and elsewhere in this News Release, which may cause actual results or events to
differ materially from those anticipated in such forward-looking statements. The
Corporation believes that the expectations reflected in those forward-looking
statements are reasonable, but no assurance can be given that these expectations
will prove to be correct and such forward-looking statements included in this
News Release should not be unduly relied upon. These statements speak only as of
the date of this News Release. The Corporation does not intend, and does not
assume any obligation, to update these forward-looking statements, whether as a
result of new information, future events or otherwise, except as required under
applicable securities laws. The forward-looking statements contained in this
News Release are expressly qualified by this cautionary statement.
Cordy uses the measures Earnings Before Interest, Taxes, Depreciation,
Amortization and Impairment and Stock Based Compensation (EBITDAS) in this news
release. This measure does not have any standardized meaning prescribed by
International Financial Reporting Standards (IFRS). It is, therefore, considered
to be non-IFRS term and may not be comparable to similar measures presented by
other entities. Management of Cordy uses these non-IFRS measures to improve its
ability to compare financial results among reporting periods and to enhance its
understanding of operating performance, liquidity and ability to generate funds
to finance operations. This non-IFRS measure is also provided to readers as
additional information on Cordy's operating performance, liquidity and ability
to generate funds to finance operations. EBITDAS is an approximate measure of
the Cordy's pre-tax operating cash flow and is generally used to better measure
performance and evaluate trends of individual assets. EBITDAS comprises earnings
before deducting interest and other financial charges, income taxes,
depreciation and amortization, net income attributable to non-controlling
interests and preferred share dividends.
FOR FURTHER INFORMATION PLEASE CONTACT:
For general information:
Cordy Oilfield Services Inc.
David Mullen, Chairman & Chief Executive Officer
403-266-2067
403-266-2087 (FAX)
david.mullen@cordy.ca
For investor relations information:
Cordy Oilfield Services Inc.
David Boomer, CA, Chief Financial Officer
403-266-2067
403-266-2087 (FAX)
dave.boomer@cordy.ca
www.cordy.ca
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