Winalta Inc. Announces Record Results for the Third Quarter Ended September 30, 2011

CALGARY, Nov. 24, 2011 /CNW/ - Winalta Inc. (TSX-V - WTA.A) ("Winalta" or the "Company") is pleased to announce its financial results for the three months ended September 30, 2011. Winalta has record revenues of $4.9 million and record EBITDA of $2.8 million for the period, compared to revenue of $3.2 million and EBITDA of $0.3 million for the three months ended October 31, 2010.

Due to the Company's change in year end to December 31, the comparative information to the 3 month period ending September 30, 2011 is from the period August 1, 2010 to October 31, 2010.

Gross profit for the period was 75% as compared to 52% for the comparative period; an improvement of 44%.  The improvement in gross profit was due to the higher utilization of the Company's assets and increased day rates for Wellsites. Utilization of Wellsites units for the period was 81% as compared to 48% for the comparative period with day rate increases of 3.4% over the comparative period and 14.3% for the nine months ended September 30, 2011.

During the period the Company reduced its total debt by $0.8 million and increased its rental fleet by $1.9 million using cash flows generated by operations. Winalta continues to build on its current rental base to help meet customer demand.

(Thousands of Canadian dollars)        
  Three months ended Nine months ended
  September
2011
$
October
2010(2)
$
September
2011
$
October
2010(2)
$
Revenue 4,865 3,167 14,652 9,277
Gross profit before depreciation 3,653 1,653 10,142 4,645
Gross profit % before depreciation 75% 52% 69% 50%
Net earnings (loss) from continuing operations 1,295 (3,776) 1,308 (6,100)
Earnings (loss) per share - continuing operations 0.03 (0.11) 0.03 (0.18)
Net gain (loss) from discontinued operations - 8,959 - (5,625)
Gain (loss) per share from discontinued operations 0.00 0.25 0.00 (0.15)
Net Earnings (loss) 1,295 5,183 1,308 (11,725)
Earnings (loss) per share and diluted earnings per share 0.03 0.15 0.03 (0.33)
EBITDA(1) 2,804 258 6,982 984
EBITDA(1) per share 0.06 0.01 0.17 0.03
Total Assets 36,973 40,787 36,973 40,787
Total Liabilities 20,660 27,222 20,660 27,222
Dividends $  - $   - $    - $   -

(1)EBITDA from continuing operations
EBITDA is a non-GAAP measurement defined as "Earnings before interest, taxes, depreciation, amortization, impairment charges, discontinued operations, loss/gain on disposal of assets, stock-based compensation and certain other gains and losses." The Company reports on EBITDA because it is a key measure used by management to evaluate performance.  The Company believes EBITDA from continuing operations assists investors in assessing our performance on a consistent basis without regard to items such as depreciation and amortization, which are non-cash in nature and can vary significantly depending on accounting methods or non-operating factors such as historical cost.  EBITDA from continuing operations is not a calculation based on GAAP and is not considered an alternative to net earnings in measuring the Company's performance. EBITDA from continuing operations does not have a standardized meaning and is therefore not likely to be comparable with similar measures used by other issuers. EBITDA from continuing operations should not be used as an exclusive measure of cash flow since it does not account for the impact of working capital changes, capital expenditures, debt changes and other sources and uses of cash, which are disclosed in the consolidated statement of cash flows.
(2)Comparative results for 2010 have been adjusted from previously reported results to be consistent with the current period for reclassification of revenue, gross profit, and earnings from discontinued operations.

Reconciliation of EBITDA from continuing operations

(Thousands of Canadian dollars, except for per share amounts)

  Three months ended Nine months ended
  September
2011
$
October
2010
$
September
2011
$
October
2010
$
Net earnings(loss) from continuing operations 1,295 (3,776) 1,308 (6,100)
Add back:        
Income tax expense (recovery) - (3,314) - (3,314)
Interest expense 303 (59) 1,861 378
Depreciation/amortization expense 1,213 1,185 3,594 3,799
Loss (gain) on disposal  of assets (65) 6,632 32 6,630
Stock based compensation 58 124 187 125
Gain on revaluation of promissory note         - (534)        - (534)
EBITDA from continuing operations (as defined) 2,804 258 6,982 984

At September 30, 2011, the Company had non-capital losses available from continuing operations to be carried forward for income tax purposes of approximately $30 million, that begin to expire in 2028.  No benefit in respect of these losses has been recorded in the financial statements.

General and Administrative Expenses

For the period ended September 30, 2011, general and administrative expenses from continuing operations were $933 thousand; 27% lower than the previous quarter ending June 30, 2011 and 20% lower than the quarter ending March 31, 2011.  The majority of the change in expenses can be attributed to a decrease in professional fees relating to legal and auditing.  The remaining expenses were in line with the prior quarters.

Outlook

The Company continues to see strong fleet utilization and strengthening rental rates, combined with the continued Western Canadian economic activity, in both oil and gas exploration, which should continue to provide opportunities for the Company.  The Company believes the strong economy will continue for the foreseeable future, as further supported by CAODC (Canadian Association of Oilwell Drilling Contractors) forecast for the balance of 2011 and into 2012, which historically has translated to higher utilization rates for Winalta's equipment.  The Company continues to expand its fleet of oilfield Wellsite units and Dedicated Geo Labs in order to meet demand and to maintain a relatively new fleet of units.  The additions to the fleet will allow the Company to continue to support its customer base in meeting their needs as well as expanding to new customers.

Winalta Inc., operating under the trade name, Winalta Oilfield Rentals, is an oilfield service provider that specializes in portable industrial rental accommodations, remote offices and Dedicated Geo Labs; servicing the Western Canadian oil and gas Industry.

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. 

Forward-looking information

Certain information set forth in this press release, including management's assessment of future plans, the economic outlook for Western Canadian oil and gas and future utilization rates may constitute forward-looking statements. By their nature, forward-looking statements involve material assumptions and are subject to numerous risks and uncertainties, including with respect to market and economic conditions and their impact on the Company's business, some of which, are beyond our control. Readers are cautioned not to place undue reliance on the forward-looking statements as the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and actual results, performance or outcomes could materially differ from those expressed or implied in such forward-looking statements and accordingly, no assurance can be given that any of the events anticipated by forward looking statements will transpire or occur, or if any of them do so, what benefit Winalta will derive there from.  The Company does not assume the obligation to revise or update this forward-looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws. 

 

SOURCE Winalta Inc.

For further information:

David Hopley, CFO
Phone: (780) 960-6900

Austin Fraser, Senior Vice President
Phone: (403) 826-5701

winalta@winaltainc.com

Profil de l'entreprise

Winalta Inc.

Renseignements sur cet organisme


FORFAITS PERSONNALISÉS

Jetez un coup d’œil sur nos forfaits personnalisés ou créez le vôtre selon vos besoins de communication particuliers.

Commencez dès aujourd'hui .

ADHÉSION À CNW

Remplissez un formulaire d'adhésion à CNW ou communiquez avec nous au 1-877-269-7890.

RENSEIGNEZ-VOUS SUR LES SERVICES DE CNW

Demandez plus d'informations sur les produits et services de CNW ou communiquez avec nous au 1‑877-269-7890.