Strad Energy Services Ltd., (“Strad” or the “Company”), a North America focused, diversified energy services company, today announced its financial results for the three and nine month periods ended September 30, 2011. All amounts are stated in Canadian dollars unless otherwise noted.
SELECTED FINANCIAL AND OPERATIONAL HIGHLIGHTS:
- Record third quarter EBITDA(1) of $18.6 million, a 116% increase compared with $8.6 million in the third quarter of 2010 and a 65% increase in EBITDA compared with the second quarter of 2011;
- Capital expenditures of $6.8 million, net of disposals, in the third quarter. By the end of September, $58.9 million of the $86.5 million approved capital program for 2011 had been spent;
- Continued deployment of assets to high growth resource areas in the United States. Record third quarter United States revenues of $29.6 million increased 132% compared with the third quarter of 2010. Total gross capital assets based in the United States now comprise 47% of total Drilling Services gross capital assets compared with 32% at the end of the third quarter of 2010;
- Ongoing success in the development of new products, including solids control, composite matting and satellite communications rental equipment with $11.3 million spent on new products in the first nine months of 2011; and
- Total funded debt to trailing EBITDA ratio of 0.7 at the end of the third quarter.
“For the second straight quarter, Strad has succeeded in generating record-setting financial performance that was driven by strong utilization rates across our Canadian and U.S. operating regions. Following several quarters of sound investment in growing our asset base, third quarter EBITDA more than doubled from the same period a year ago,” said Henry van der Sloot, Chief Executive Officer of Strad. “In keeping with our commitment to disciplined growth, we are also mindful of the current volatility of the global macroeconomic picture and are closely monitoring our anticipated capital spending for the balance of 2011 and beyond. We feel we are well positioned to rapidly scale the level of investment in our business as broader industry conditions dictate.”
“This quarter’s success speaks to the growing strength and depth of our customer base which includes major producers on both sides of the border,” said Andy Pernal, President of Strad. “As the industry continues to shift towards increasingly complex and larger-scale projects that require broader rental equipment fleets, it is our growing investment in our asset base and expanded knowledge of our customers’ businesses that allows us to penetrate deeper into the marketplace and ensure a growing reliance on the Strad brand.”
(1) Earnings before interest, taxes, depreciation and amortization (“EBITDA”) is not a recognized measure under IFRS or previous Generally Accepted Accounting Principles in Canada (“GAAP”); see “Non-IFRS Measures Reconciliation” in this press release.