CALGARY, ALBERTA--(Marketwire - Nov. 24, 2011) -
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Phoenix Oilfield Hauling Inc. (TSX VENTURE:PHN) (the "Company" or "Phoenix") announces its financial and operating results for the three and nine months ended September 30, 2011 ("2011 Q3"). Effective January 1, 2011, the Company began reporting its financial results in accordance with International Financial Reporting Standards ("IFRS"). Prior year comparative amounts have been restated to reflect results as if the Company had always prepared its financial results using IFRS.
Highlights for 2011 Q3 include:
Commenting on the Company's recent activity and results, Mr. David Werklund, Interim President and Chief Executive Officer commented, "In the third quarter, Phoenix realized improved utilization of its equipment, successfully achieving the benefits expected from redeploying assets to stronger markets. This initiative has improved revenue and profitability levels during 2011 as compared to 2010 and Phoenix expects this to continue over the remainder of the year. We are mindful that the long-term growth outlook for the Company is correlated with commodity prices and rig counts, and we have been very encouraged by the strong customer demand that continues to be present in each of our operating areas."
Mr. Werklund also stated, "Recently the Company has welcomed the addition of several key people to its management team. These team members are excited about the prospects they see for strategically growing the Company in key markets and enhancing shareholder value."
In Canada the Company has enjoyed the increased activity levels of 2011 over 2010 in the markets in which it operates. In November 2011 the Petroleum Services Alliance of Canada ("PSAC", information available at www.psac.ca) released their forecast of wells drilled in Canada in 2012, projecting a 10% increase in 2012 compared to 2011. This forecast matches the Company's expectation of continued higher utilization of its equipment than in recent years. In addition, this forecast supports the Company's view of opportunity to expand its operations and increase its revenue in certain areas of Canada.
Opportunities for expansion and growth appear strongest for the Company in the United States. According to Baker Hughes (see www.bakerhughes.com), the United States active land rig count at November 11, 2011 was almost 20% higher than the previous year. The current active land based rig count is close to 2,000, with much of that activity in several key shale gas plays. The Company is currently active in two of those plays through its branches in Texas and Pennsylvania and expects that levels of industry exploration activity, as measured by the active rig count, will remain at least consistent with current levels over the next few quarters.
The recent signing of a new facility agreement with the senior lender has returned the Company to a conventional banking relationship. Together with the recently announced related party credit facility and the recapitalization and private placement transactions expected to close in December, the Company expects to have increased access to capital and on more favorable terms which should enable it to pursue a number of opportunities. The recent acquisition of additional oilfield rental equipment is part of how the Company expects to exploit the opportunity to increase its earnings in Canada. In the near term the Company expects to deploy the majority of its new capital to obtain equipment to expand into a third market in the United States, as well as to increase its fleet of equipment at its existing United States branches.
The Company announces the appointment of Mr. Bharat Mahajan as Chief Financial Officer effective November 25, 2011, in addition to his previous position of Vice President, Finance. Mr. Vic Fitch has resigned from the position of Interim Chief Financial Officer and will remain with the Company for a transitional period. The board of directors would like to thank Mr. Fitch for his contributions to the Company while he was Interim Chief Financial Officer.
Common Share Consolidation
At the Company's annual and special meeting of shareholders on November 23, 2011, the shareholders authorized the board of directors to consolidate the common shares of the Company at a ratio of 30 to 1 (the "Consolidation"). The TSX Venture Exchange (the "TSXV") also approved the proposed consolidation of the Company's common shares at a ratio of 30 to 1. The Company's common shares will commence trading on a consolidated basis on the TSXV (the stock symbol will remain "PHN") at the opening of trading on Monday, November 28, 2011. The Company currently has 172,851,317 common shares issued and outstanding, and after giving effect to the Consolidation the Company will have 5,761,710 common shares issued and outstanding. The Company's name will not change as a result of the Consolidation.
Summary of Quarterly Results
The Company's financial information for the past eight quarters is presented below. Quarterly figures for 2011 and 2010 are presented in accordance with IFRS. Quarterly figures for 2009 are presented in accordance with previous Canadian GAAP.
|EBITDA1, % of revenue||16||%||11||%||21||%||17||%||11||%||(14||%)||14||%||6||%|
|EBITDA per share -
basic & diluted
|Income (loss), % of revenue||9||%||(8||%)||8||%||35||%||(6||%)||(38||%)||(9||%)||(49||%)|
|Earnings (loss) per share - basic & diluted||$||0.01||(0.01||)||0.01||0.03||(0.00||)||(0.01||)||(0.01||)||(0.05||)|
|Weighted average shares - basic & diluted||172,226||171,766||170,375||169,041||168,541||168,541||161,722||66,248|
1 See Non-IFRS measures.
Non-IFRS Measures - EBITDA
The Company defines EBITDA as earnings before finance costs, taxes, depreciation, amortization, impairments related to equipment and leaseholds, goodwill and intangible assets, gains or losses on disposal of equipment and leaseholds and stock based compensation. Management believes that in addition to income (loss), EBITDA is a useful supplemental performance measure as it used by management to evaluate the results generated by the Company's principal business activities prior to depreciation, amortization and impairment charges or reversals, consideration of how these activities are financed and how the results are taxed in various jurisdictions. The Company modified its method of calculating EBITDA after December 31, 2010, and has revised prior period EBITDA amounts to be consistent with this modified definition. EBITDA is not a recognized measure under IFRS and consequently does not have a standard prescribed meaning. The Company's method of calculating EBITDA may differ from other companies, and accordingly, it may not be comparable to a similarly described measure used by another company.
The Company's consolidated financial statements and Management's Discussion and Analysis are available on the SEDAR website at www.sedar.com.
This news release may contain certain forward-looking statements, which include assumptions with respect to (i) future operations; (ii) future economic conditions; (iii) future capital expenditures; (iv) EBITDA; and (v) the completion of the Consolidation. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Such risks and uncertainties include, without limitation, risks associated with loss of markets, volatility of commodity prices, fluctuations in foreign exchange or interest rates environmental risks, competition from other companies, ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, the lack of availability of qualified personnel or management, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amount of proceeds, that the Company will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. All forward-looking statements contained in this press release are expressly qualified in their entirety by these cautionary statements.
The forward-looking statements contained in this news release are made as at the date hereof and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.