SERVICE SECTOR / Tesco Corp. Nine Month Earnings Report
TESCO CORPORATION REPORTS 69% GROWTH IN NINE MONTH EARNINGS
CALGARY, Jan. 20 /CNW/ - Tesco Corporation is pleased to report that its
unaudited net earnings for the nine months ended November 30, 1997 were $19.3
million, a 69% increase over earnings for the comparative period last year.
Fully diluted earninggs per share were $0.64 for the nine months, a 56%
increase over the first nine months of fiscal 1997.
-------------------------------------------------------------------------
Millions of Cdn Dollars Nine Months Ended Nine Months Ended %
(unless noted) November 30, 1997 November 30, 1996 Change
-------------------------------------------------------------------------
Revenue 115.3 65.2 +77%
EBITDA 38.4 21.3 +80%
Net Earnings 19.3 11.4 +69%
Earnings per share
- basic ($/share) $0.68 $0.46 +48%
Earnings per share
- fully diluted ($/share) $0.64 $0.41 +56%
Rental Service Days 13,884 8,515 +63%
Top Drive Units Sold 15 9 +67%
Capital Additions 26.3 23.9 +10%
Working Capital 82.6 23.3 +255%
Fully Diluted Shares
Outstanding (millions) 33.7 31.0 +9%
-------------------------------------------------------------------------
Tesco is also pleased to report that its unaudited net earnings for the
quarter ending November 30, 1997 were $7.3 million, a 78% increase over
earnings for the same quarter last year. Fully diluted earnings per share
were $0.24 for the quarter, a 71% increase over the third quarter of fiscal
1997.
-------------------------------------------------------------------------
Millions of Cdn Dollars Quarter Ended Quarter Ended %
(unless noted) November 30, 1997 November 30, 1996 Change
-------------------------------------------------------------------------
Revenue 44.7 25.8 +73%
EBITDA 14.5 7.8 +86%
Net Earnings 7.3 4.1 +78%
Earnings per share
- basic ($/share) $0.25 $0.16 +71%
Earnings per share
- fully diluted ($/share) $0.24 $0.14 +71%
Rental Service Days 5,110 3,168 +61%
Top Drive Units Sold 5 3 +67%
-------------------------------------------------------------------------
Operational highlights of the period include:
- The top drive business continues to grow. During the third quarter,
Tesco manufactured 17 new top drive units and rental fleet utilization
remained at approximately 65%. Tesco's research and development
efforts have been commercialized in the area of underbalanced drilling
and progress continues in the development of the drilling with casing
project.
- The top drive rental fleet grew to 103 units at the end of the third
quarter. This compares with 91 at the end of the 2nd quarter and 65
at the end of November, 1996.
- Of the five top drive systems sold in the third quarter, one was a
permanent magnet motor electric (EC) systems and one was an HMI
system.
- In December, 1997, arrangements were concluded to sell six existing
rental top drive systems in Indonesia. Sale proceeds were $6.2
million ($US) and Tesco facilitated the financing of this purchase by
providing a buyback guarantee. The gain on sale of these units will
be recognized over the term of the guarantee.
- Construction was completed of the first integrated underbalanced
drilling system in early December. Commissioning and extensive shop
testing were conducted throughout December and on January 20, 1998,
the system was shipped to its first job in Northern Canada. Long
delivery components have been ordered for the construction of three
additional systems. All four systems are expected to be in service by
mid-1998. Additional systems are expected to be built and placed in
service later in the year.
- Tesco has entered the air drilling business which is complementary to
the underbalanced business. Operating from Denver, Colorado, Tesco
Underbalanced Drilling Services will initially construct five air
drilling systems consisting of nitrogen generation and air compression
modules. There is currently strong demand for these systems and
limited new supply.
- The casing drilling rig is 95% complete. It is expected that drilling
of the first casing drilling test well will commence before the end of
the next quarter. Based on the results of the surface testing of the
first set of downhole tools, modifications have been made and a second
set of prototype tools has been constructed by Tesco's Gris Gun
subsidiary. Approximately 80% of the original $5 million of joint
venture investment in the casing drilling project has been expended.
The Corporation's working capital position was improved substantially
during the quarter as a result of the receipt of the $48.4 million in net
proceeds from the 2.2 million share issue, completed at the close of the
previous quarter. |
