SERVICE SECTOR / Trican Well Service reports 1997 Results
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($ millions, except per share amounts)
Three months ended Year ended Eight months
December 31, December 31, ended
December 31,
1997 1996 1997 1996
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Operations revenue $ 9.0 $3.6 $ 28.1 $8.7
Earnings (loss) before
interest, income taxes,
depreciation & amortization
(EBITDA) 1.5 0.01 4.6 1.0
Net income (loss) 0.6 (0.1) 2.2 0.4
Net income (loss) per share
(basic) 0.06 (0.02) 0.24 0.10
(fully diluted) 0.06 (0.02) 0.23 0.10
Cash flow from operations 1.6 0 4.5 0.6
Cash flow from operation per
share (basic) 0.15 0 0.49 0.16
(fully diluted) 0.14 0 0.44 0.16
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Trican Well Service Ltd. ("Trican") is pleased to announce its fourth
quarter and year ended December 31, 1997 results - periods of significant
growth for the Company.
Revenues for the year were $28.1 million, as compared to the results for the
eight months ended December 31, 1996 of $8.7 million. Net income for the year
of $2.2 million increased $1.9 million over net income for the eight months
ended December 31, 1996 of $0.4 million. Earnings per share similarly rose to
$0.24 for the year ended December 31, 1997 as compared to $0.10 for the eight
months ended December 31, 1996.
Fourth quarter revenues increased $5.4 million and net income increased by
$0.7 million compared to the same quarter last year. Basic earnings per share
were $0.06 compared to a loss per share of $0.02 for the same period last
year.
Record levels of industry activity, major equipment purchases and an
expanded market presence accounted for the significant growth in consolidated
revenues and net income for the quarter and year ended December 31, 1997.
Broadening Our Base of Operations
In response to the demand for well service equipment, Trican significantly
expanded its equipment fleet and increased its area of operations by opening
a base in Red Deer and acquiring a base in Brooks. As a result of the
broadened operations capacity, the Company completed 4,322 jobs during the
year. This is a large increase over the 1,811 jobs completed during the eight
months ended December 31, 1996.
Revenue per job increased from $4,819 per job during the eight months ended
December 31, 1996 to $6,446 in 1997. This increase is the result of the
Company's growth strategy of placing greater emphasis on primary cementing
and the growth of coiled tubing, nitrogen and acid service lines as a
percentage of total revenue.
Building Our Asset Base
On June 4, 1997, Trican closed an equity offering, raising $7.2 million in
gross proceeds on the sale of 2,000,000 Special Warrants. The proceeds from
this offering, as well as cash flow from operations, allowed Trican to
continue its aggressive expansion program. Investment in equipment totaled
$20.9 million in 1997, a significant increase over the $1.4 million invested
in the eight months ended December 31, 1996. Of the equipment currently
operational, 40% of the cementing units, all of the coil units, nitrogen
units, acid units and fracturing equipment are less than two years old. This
equipment utilizes the latest technology and is able to provide higher levels
of operational efficiencies, an important feature in a cost sensitive market.
Investing in People
Trican's rapid expansion was made possible by the Company's ability to
attract top quality experienced people. At December 31, 1997 Trican employed
195 people an increase of 167% from the 73 people employed at the end of
1996. These people were attracted by the possibility of joining an
aggressive, Canadian-focused well service company which offers them input
into the direction the Company is taking. We recognize that our people are
our greatest asset and we will need to continue to invest in and develop them
if the Company is going to expand its operations and offer the same high
quality, technologically innovative services to our customers.
Looking Forward
1997 was a year of growth and transformation for Trican. With the aggressive
equipment acquisition program, geographic expansion and the increased number
of operating personnel, Trican is a different company than it was at the
start of the year. With a broader base of operations and enhanced equipment
capacity, Trican has invested heavily in its future and is well positioned
for growth.
Trican is a well service company focused on serving the oil and gas industry
in western Canada. Trican provides a comprehensive array of specialized
products, equipment, services and technology for use in the drilling,
completion, stimulation and reworking of oil and gas wells. Through its bases
in Red Deer, Lloydminster, Provost, Kindersley and Brooks, Trican provides
fracturing, coiled tubing, stimulation, cementing and related services to the
oil and gas industry.
Requests for shareholder information should be directed to:
Murray Cobbe Michael Kelly
President and CEO Vice President, Finance & Administration
and CFO
Phone - (403) 266-0202 Fax - (403) 237-7716 |
