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Press release from Marketwire

Pulse Seismic Inc. Reports Preliminary 2011 Unaudited Financial Results and Appointment of New Director

Monday, February 06, 2012

Pulse Seismic Inc. Reports Preliminary 2011 Unaudited Financial Results and Appointment of New Director08:30 EST Monday, February 06, 2012CALGARY, ALBERTA--(Marketwire - Feb. 6, 2012) - Douglas Cutts, President and Chief Executive Officer of Pulse Seismic Inc. ("Pulse" or "the Company")(TSX:PSD), reports the following preliminary selected unaudited financial and operating results of Pulse for the fourth quarter of 2011 and for the year ended December 31, 2011. The financial information contained in this news release is based on management's estimates and has not yet been approved by the Company's Audit Committee or Board of Directors, or reviewed by the Company's auditors. HIGHLIGHTSSeismic data library sales for the year ended December 31, 2011 were approximately $36.2 million, an increase of 19% over the $30.3 million in data library sales achieved for the year ended December 31, 2010. Seismic data library sales for the three months ended December 31, 2011 were approximately $12.5 million, a 26% decrease from $16.9 million for the same period in 2010. Total seismic revenue (including revenue from participation surveys) for the year ended December 31, 2011 was approximately $51.5 million compared to $33.0 million for the year ended December 31, 2010. Cash EBITDA(a) for the year ended December 31, 2011 was approximately $27.7 million ($0.41 per share basic and diluted), an increase of 28% over the $21.7 million ($0.38 per share basic and diluted) for the year ended December 31, 2010. Shareholder Free Cash Flow(a) for the year ended December 31, 2011 was $23.9 million ($0.36 per share basic and diluted), an increase of 22% over the $19.6 million ($0.35 per share basic and diluted) for the year ended December 31, 2010. Net earnings for the year ended December 31, 2011 were $5.2 million ($0.08 per share basic and diluted) compared to a net loss of $1.3 million ($0.02 per share basic and diluted) for the same period in 2010. Pulse's working capital position was $5.0 million (including cash of $17 million and current portion of long term debt of $13.0 million) at December 31, 2011 compared to $7.9 million (including cash of $17 million and current portion of long term debt of $13.0 million) at December 31, 2010. In the fourth quarter of 2011, Pulse was completing a 275 net square kilometres 3D seismic survey in the Edson area of west central Alberta. At December 31, 2011 the survey was 97% complete. Originally scheduled for delivery by December 31, 2011, this survey will now be delivered in the first quarter of 2012. In October 2011, Pulse commenced operations on two additional 3D participation surveys located within the Deep Basin plays of west central Alberta. The first survey located in the Kaybob area, consists of 147 net square kilometres of seismic data. The second survey located in the Simonette area consists of approximately 132 net square kilometres. Both surveys were approximately 75% complete at December 31, 2011 and are currently expected to be delivered in the first quarter of 2012. Subsequent to December 31, 2011 Pulse purchased and cancelled through its normal course issuer bid a total of 1,517,000 common shares at a total cost of approximately $2.6 million. "Pulse is pleased with the preliminary financial results of 2011 given the continued challenge of generating revenue in a depressed natural gas commodity environment," commented Douglas Cutts. "It is a testament to the extensive coverage that our 2D and 3D seismic data library provides, giving us the ability to generate significant data library sales within this environment. In 2011 we continued accumulating new 3D seismic data through participation surveys, enabling us to market to our clients in the areas in which they continue significant exploration and development activity. These opportunities have provided Pulse the ability to reinstate the dividend, aggressively repurchase its shares and reduce debt while maintaining a solid balance sheet".On Monday, March 19, 2012 Pulse intends to release its complete audited financial results for the year ended December 31, 2011. A conference call and webcast to review the 2011 results is scheduled for Tuesday, March 20, 2012 at 1:00 EDT (11:00 am MDT). Further details of the conference call, including dial-in numbers, will be provided at a later date.(a) The Company's continuous disclosure documents provide discussion and analysis of "cash EBITDA", "cash EBITDA per share", "shareholder free cash flow" and "shareholder free cash flow per share". These financial measures do not have standard definitions prescribed by IFRS (new Canadian GAAP) and, therefore, may not be comparable to similar measures disclosed by other companies. The Company has included these non -GAAP financial measures because management, investors, analysts and others use them as measures of the Company's financial performance. The Company's definition of cash EBITDA is cash available for interest payments, cash taxes if applicable, debt servicing, discretionary capital expenditures and the payment of dividends, and is calculated as earnings (loss) from continuing operations before interest, taxes, depreciation and amortization less participation survey revenue, plus any non-cash and non-recurring SG&A expenses. Cash EBITDA excludes participation survey revenue as these funds are directly used to fund specific participation surveys and this revenue is not available for discretionary capital expenditures. The Company believes cash EBITDA assists investors in comparing Pulse's results on a consistent basis without regard to participation survey revenue and non-cash items, such as depreciation and amortization, which can vary significantly depending on accounting methods or non-operating factors such as historical cost. Cash EBITDA per share is defined as cash EBITDA divided by the diluted weighted average number of shares outstanding for the period. Shareholder free cash flow further refines the calculation of capital available to invest in growing the Company's 2D and 3D seismic data library, to repay debt, to repurchase its common shares and to pay dividends by deducting non-discretionary expenditures from cash EBITDA. Non-discretionary expenditures are defined as debt financing costs (net of deferred financing expenses amortized in the current period) and current tax provisions. Shareholder free cash flow per share is defined as shareholder free cash flow divided by the diluted weighted average number of shares outstanding for the period.CORPORATE UPDATEThe Board of Directors is pleased to announce the appointment of Mr. Peter Burnham as a Director of Pulse effective January 31, 2012. Mr. Burnham is an independent businessman with extensive executive experience in both private and public oil and natural gas companies. Mr. Burnham's 32 years of experience encompasses various executive roles including that of Vice President, Exploration of Tri Link Resources Ltd. (1981 - 2000). Since the sale of Tri Link in 2000, Mr. Burnham has managed and directed a number of privately held companies, including the role of Co-Founder, President and Director of Arista Energy Ltd (2004 - 2008) which was sold to Tri Star in 2008. A graduate of the University of British Columbia, Mr. Burnham holds a B.Sc. Geological Sciences. He has extensive experience in capital markets and has intimate knowledge of the Western Canadian Sedimentary Basin. Mr. Burnham is a director for two privately held companies, Epping Energy Inc. and Kilo Technologies and is an active director on various charitable organizations.CORPORATE PROFILEPulse is a market leader in the acquisition, marketing and licensing of 2D and 3D seismic data to the western Canadian energy sector. Pulse owns the second-largest licensable seismic data library in Canada, currently consisting of approximately 26,700 net square kilometres of 3D seismic and approximately 340,000 net kilometres of 2D seismic. The library extensively covers the Western CanadaSedimentary Basin where most of Canada's oil and natural gas exploration and development occur.Forward Looking InformationThis news release contains information that constitutes "forward looking information" or "forward looking statements" (collectively, "forward looking information") within the meaning of applicable securities legislation. This forward looking information includes, among other things, statements regarding:general economic and industry outlook; industry activity levels and capital spending; expected commencement, completion and delivery dates for participation surveys; Pulse's business and growth strategy; and Other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results and performance. Often, but not always, forward looking information uses words or phrases such as: "expects", "does not expect" or "is expected", "anticipates" or "does not anticipate", "plans" or "does not plan", "estimates" or "estimated", "projects" or "projected", "forecasts" or "forecasted", "believes" or "does not believe", "intends" or "does not intend", "likely" or "unlikely", "possible", "probable", "scheduled", "positioned", "goal", "objective", "hopes", "optimistic" or states that certain actions, events or results "should", "may", "could", "would", "might" or "will" be taken, occur or be achieved.Undue reliance should not be placed on forward-looking information. Forward looking information is based upon current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to vary and in some instances to differ materially from those anticipated in the forward looking information.The material risk factors that could cause actual results to differ materially from the forward-looking information include, but are not limited to:economic risks; the demand for seismic data and participation surveys; the pricing of data library license sales; the level of pre-funding of participation surveys, and the ability of the Company to make subsequent data library sales from such participation surveys; the ability of the Company to complete participation surveys on time and within budget; the price and demand for oil and natural gas; the level of oil and natural gas exploration and development activities; the ability of the Company's customers to raise capital; environment, health and safety risks; the effect of seasonality and weather conditions on participation surveys; federal and provincial government laws and regulation, including taxation, royalty rates, environment and safety; competition from other seismic data library companies; dependence upon qualified seismic field contractors; dependence upon key management, operations and marketing personnel; loss of seismic data; and protection of Intellectual Property. The foregoing list of risks is not exhaustive. Additional information on these risks and other factors which could affect the Company's operations or financial results are included in the Risk Factors section of the Company's MD&A for the most recent calendar year and interim periods. Forward looking information is based upon the assumptions, expectations, estimates and opinions of the Company's management at the time the information is presented.FOR FURTHER INFORMATION PLEASE CONTACT: Douglas CuttsPulse Seismic Inc.President and CEO(403) 237-5559 or Toll-free: 1-877-460-5559ORPamela WicksPulse Seismic Inc.VP Finance and CFO(403) 237-5559 or Toll-free: 1-877-460-5559info@pulseseismic.comwww.pulseseismic.com