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Cordy Reports Third Quarter and Year to Date Results

Friday, November 9, 2012 4:53 PM


CALGARY, ALBERTA--(Marketwire - Nov. 9, 2012) - 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 share amounts) Q3 2012 Q3 2011 $ Change Q3 YTD
2012
Q3 YTD
2011
$ Change
FINANCIAL RESULTS
Revenue 33.7 23.5 10.2 86.5 63.6 22.9
EBITDAS1 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
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

(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.

Neither the 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.

Contact Information:
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

(Source: CCN )
(Source: Quotemedia)

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