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Press release from CNW Group


Tuesday, June 14, 2011

PETROWEST ENERGY SERVICES TRUST ANNOUNCES STRONG FIRST QUARTER FINANCIAL RESULTS FOR 201123:04 EDT Tuesday, June 14, 2011CALGARY, June 14, 2011 /CNW/ - Petrowest Energy Services Trust (TSX: PRW.UN) announced today its consolidated financial results for the three months ended March 31, 2011.Consolidated revenue from continuing operations for the three months ended March 31, 2011 was $46.2 million, an increase of 29% over consolidated revenue from continuing operations of $35.8 million in the comparable period of 2010. Gross margin and EBITDA percentages increased by 3% and 4% respectively compared to 2010. For the three months ended March 31, 2011, the comprehensive loss attributable to unitholders was $19.8 million in the first quarter of 2011 compared to $3.5 million in 2010. This represents net loss per unit of $0.23 and $0.11 respectively, basic and fully diluted. This increase in comprehensive loss attributable to unitholders is largely due to the revaluation of trust units of $17.2 million, and the loss on fair value of financial instruments of $2.8 million for the warrants and the conversion feature of the convertible debentures which are required under International Financial Reporting Standards. The net income (loss) attributable to unitholders would have been $0.07 million in the first quarter of 2011 without these non-cash charges.FINANCIAL HIGHLIGHTS                  Three monthsended March 31(thousands of dollars, except per unit amounts, margins and ratios)    2011      2010            Revenue by segment:            Construction    29,046     15,887 Transportation    9,842     9,011 Civil    6,130     9,592 Rentals    1,198     1,266Revenue from continuing operations    46,216     35,756Operating expenses    36,767     29,625Gross margin from continuing operations    9,449     6,131Gross margin percentage    20%     17%General and administrative    1,529     1,485EBITDA from continuing operations    7,920     4,646EBITDA margin percentage    17%     13%Amortization of property and equipment    5,101     5,260Amortization of intangible assets    862     862Loss (gain) on disposal of property and equipment    376     129Net finance costs    1,511     859Net income before revaluation of financial instruments and trust units    70     (2,464)Loss (gain) on fair value of financial instruments    2,763     -Revaluation of trust units    17,151     964Comprehensive loss before discontinued operations    (19,844)     (3,428)Discontinued operations, net of tax    -     (45)Comprehensive loss attributable to unitholders    (19,844)     (3,473)Net loss per unit - basic and diluted    (0.23)     (0.11)Total assets    105,070     111,609Total liabilities    120,316     88,483Other components of equity    (15,246)     23,126The oil and natural gas drilling sector will continue to impact the Trust's operations and financial results and remains an important part of the Trust's operations going forward. The amount of the Trust's services directly relating to the oil and gas sector will fluctuate as the activity in this sector changes in addition to the amount of non-oil and gas related projects which the Trust is successful in securing. The Trust continues its strategy of geographic diversification with redeployment of equipment and skilled personnel to capitalize on demand in nearby regions plus improving utilization rates and financial results. With the shift in the North American natural gas markets towards unconventional shale gas basins, the Trust has moved quickly to position itself in two of North America's premier shale gas plays. The Trust has opened a full service office and maintenance facility in Fort Nelson and increased marketing emphasis in the northeastern British Columbia emerging Horn River and Montney shale gas plays. Petrowest has also undertaken a strategy to expand its presence in the oil sands mining sector by appointing a divisional vice president and by securing office and industrial space in Fort McMurray. This sector represents significant potential growth for the Trust.Management of the Trust continues to streamline and improve operating efficiencies in addition to taking proactive steps to improve the financial flexibility of the Trust. This is being accomplished through consolidation of entities within segments, consolidation of redundant management functions and a detailed review of the fixed cost structures inherent in the Trust to reduce costs and improve both operations and financial results.SELECTED FINANCIAL INFORMATIONSelected financial information for the three months period ended March 31, 2011 is included above. This information should be read in conjunction with the unaudited interim consolidated financial statements for the three months ended March 31, 2011 and the Trust's Management, Discussion and Analysis, available under the Trust's profile on the SEDAR website at INFORMATIONThis news release contains forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are identified by their use of terms and phrases such as "anticipate," "achievable," "believe," "expect," "estimate," "plan," "intend," "project," "may," "should," "could," "predict," "may," "will," or similar words suggesting future outcomes or language suggesting an outlook. Forward-looking statements and information are based on Petrowest's current beliefs as well as assumptions made by and information currently available to Petrowest concerning anticipated business performance. Although management of Petrowest considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Forward-looking statements are subject to many external variables that are beyond Petrowest's control, such as fluctuating prices for crude oil and natural gas, changes in drilling activity, and general local and global economic, political, business and weather conditions. If any of these, or other uncertainties, materialize the actual results of Petrowest may vary materially from those expected.For further information: Richard Quigley, President and Chief Executive Officer, or Lloyd A. Wiggins, Chief Financial Officer, at (780) 830-0881 or