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Press release from CNW Group

Ensign Energy Services Inc. Reports Summary 2011 Second Quarter Results

Tuesday, August 02, 2011

Ensign Energy Services Inc. Reports Summary 2011 Second Quarter Results23:25 EDT Tuesday, August 02, 2011CALGARY, Aug. 2, 2011 /CNW/ - Ensign Energy Services Inc. ("Ensign" or the "Company") is pleased to report its summary financial results for the three months and six months ended June 30, 2011.The Company recorded revenue of $334.4 million in the three months ended June 30, 2011, an increase of 30 percent from revenue of $257.6 million recorded in the second quarter of the prior year.  The Company recorded revenue of $836.7 million for the six months ended June 30, 2011, a 37 percent increase from revenue of $610.4 million for the six months ended June 30, 2010.  EBITDA (defined as earnings before interest, taxes, depreciation, amortization and share-based compensation expense) totaled $65.1 million in the second quarter of 2011, 38 percent higher than EBITDA of $47.2 million in the second quarter of 2010.  EBITDA for the six months ended June 30, 2011 totaled $235.4 million, an increase of 67 percent from EBITDA of $140.9 million recorded in the first six months of 2010.  Adjusted net income (defined as net income before share-based compensation expense, tax-effected using an income tax rate of 35%) totaled $18.9 million ($0.12 per common share) in the second quarter of 2011, 89 percent higher than Adjusted net income of $10.0 million ($0.07 per common share) in the second quarter of 2010.  Adjusted net income for the six months ended June 30, 2011 totaled $106.6 million ($0.70 per common share), an increase of 119 percent from Adjusted net income of $48.6 million ($0.32 per common share) recorded in the first six months of 2010.  Due to the negative impact of share-based compensation expense in the second quarter of 2011 compared to a recovery in the second quarter of 2010, net income for the second quarter of 2011 increased only slightly over the comparable prior year period to $16.1 million ($0.11 per common share) compared to net income of $16.0 million ($0.10 per common share) for the second quarter of 2010.  Net income for the six months ended June 30, 2011 totaled $95.8 million ($0.63 per common share), an increase of 75 percent from net income of $54.8 million ($0.36 per common share) recorded in the first six months of 2010.  Funds from operations increased 44 percent to $66.4 million ($0.43 per common share) in the second quarter of 2011 from $46.0 million ($0.30 per common share) in the second quarter of the prior year.  Funds from operations for the first six months of 2011 increased 66 percent to $220.9 million ($1.44 per common share) from $132.8 million ($0.87 per common share) recorded in the same period in 2010.Increased demand for oilfield services in the second quarter and first half of 2011 compared to similar periods in the prior year resulted in improved operating and financial results from Ensign's Canadian and United States operations.  This was in spite of the "spring break up" and wet weather setbacks experienced by the Company's Canadian segment during the second quarter of 2011.  The Company's international financial contributions in the first half of 2011 also improved slightly from the prior year despite the negative translational impact from a weakening United States dollar.The Company will be issuing detailed financial results of its second quarter after the markets close on Thursday, August 4, 2011.  A conference call to discuss the Company's second quarter 2011 results will be held at 2:00 p.m. MDT (4:00 p.m. EDT) on Monday August 8, 2011.  Details regarding the conference call-in numbers will be included in the August 4, 2011 press release.Ensign Energy Services Inc. is an international oilfield services contractor and is listed on the Toronto Stock Exchange under the trading symbol ESI.FINANCIAL AND OPERATING HIGHLIGHTS($ thousands, except per share data and operating information)  Three months ended June 30Six months ended June 30  20112010% Change20112010 % Change        Revenue   334,445257,57830 836,656610,41737EBITDA 1   65,14347,18638235,406140,93167EBITDA per share 1         Basic  $0.43$0.3139$1.54$0.9267  Diluted  $0.43$0.31 39$1.54$0.9267Adjusted net income 2   18,94110,029 89106,64148,643119Adjusted net income per share 2         Basic  $0.12$0.0771$0.70$0.32119  Diluted  $0.12$0.0771$0.70 $0.32119Net income   16,07316,001 -95,76454,84775Net income per share         Basic  $0.11$0.1010$0.63 $0.3675  Diluted  $0.11 $0.1010$0.63$0.3675Funds from operations 3   66,39546,02744220,936132,75966Funds from operations per share 3         Basic  $0.43$0.3043 $1.44 $0.8766  Diluted  $0.43 $0.3043$1.44$0.8766Weighted average shares - basic (000s)   152,891152,877 -152,920152,897 -Weighted average shares - diluted (000s)   152,954153,278 -152,934153,365-Drilling         Number of marketed rigs        Canada       Conventional  128146(12)128146 (12)  Oil sands coring/coal bed methane  382836382836  United States  8580 6 8580 6  International 4  5958 25958 2Operating days         Canada 5  2,3802,0361710,3078,10727  United States  4,4123,760178,6787,02224          International  2,604 2,480 55,2694,70812Well Servicing         Number of marketed rigs        Canada  101112(10)101112(10)  United States  3 20553120 55  Operating hours        Canada  28,96025,5041468,48163,7847  United States  18,907 12,0415736,35723,545541 EBITDA is defined as "income before interest expense, income taxes, depreciation and share-based compensation (recovery)/expense".  Management believes that in addition to net income, EBITDA and EBITDA per share are useful supplemental measures as they provide an indication of the results generated by the Company's principal business activities prior to consideration of how these activities are financed, how the results are taxed in various jurisdictions or how the results are impacted by the accounting standards associated with the Company's share-based compensation plans.  EBITDA and EBITDA per share as defined above are not recognized measures under International Financial Reporting Standards and accordingly may not be comparable to measures used by other companies.2 Adjusted net income is defined as "net income before share-based compensation (recovery)/expense, tax-effected using an income tax rate of 35%".  Adjusted net income and adjusted net income per share are useful supplemental measures as they provide an indication of the results generated by the Company's principal business activities prior to consideration of how the results are impacted by the accounting standards associated with the Company's share-based compensation plans, net of income taxes.  Adjusted net income and adjusted net income per share as defined above are not recognized measures under International Financial Reporting Standards and accordingly may not be comparable to measures used by other companies.3 Funds from operations is defined as "cash provided by operating activities before the change in non-cash working capital".  Funds from operations and funds from operations per share are measures that provides additional information regarding the Company's liquidity and its ability to generate funds to finance its operations.  Management utilizes these measures to assess the Company's ability to finance operating activities and capital expenditures.  Funds from operations and funds from operations per share are not measures that have any standardized meaning prescribed by International Financial Reporting Standards and accordingly may not be comparable to similar measures used by other companies.4 Includes workover rigs.5 Excludes coring rig operating days.    For further information: Glenn Dagenais, Executive Vice President Finance and Chief Financial Officer, (403) 262-1361.