CALGARY, Dec. 30, 2016 /CNW/ - Ensign Energy Services Inc. ("Ensign" or the "Company", TSX: ESI) is pleased to announce that the 2017 capital expenditure budget has been approved by its Board of Directors at C$61 million. The 2017 capital budget reflects Ensign's current focus on retaining a strong balance sheet while making selective capital expenditures on a number of growth opportunities.
The Company also announces that effective December 28, 2016, the Company has amended and extended its revolving term credit agreement (the "Agreement"). Based on current and future capital requirements the Company has reduced the credit available under the Agreement to C$500 million and has amended certain financial covenants. The maturity date is October 3, 2018 and the financial covenants under the Agreement are:
- The Consolidated Senior Debt (being the Company's bank debt and outstanding senior unsecured notes) to Consolidated EBITDA Ratio shall not exceed: (i) 4.00:1.00 as at the end of the Fiscal Quarters ending on December 31, 2016, March 31, 2017 and June 30, 2017, (ii) 3.75:1.00 as at the end of the Fiscal Quarters ending on September 30, 2017 and December 31, 2017, and (iii) 3.50:1.00 at any time thereafter;
- the Consolidated Debt to Consolidated EBITDA Ratio shall not exceed: (i) 4.75:1.00 as at the end of the Fiscal Quarters ending on December 31, 2016, March 31, 2017 and June 30, 2017, (ii) 4.50:1.00 as at the end of the Fiscal Quarters ending on September 30, 2017 and December 31, 2017, and (iii) 4.25:1.00 at any time thereafter;
- the Consolidated Debt to Consolidated Capitalization Ratio as at the end of any Fiscal Quarter shall not exceed 45%; and
- the Consolidated EBITDA to Consolidated Interest Expense as at the end of any Fiscal Quarter shall not be less than 3.00:1.00.
Consolidated EBITDA is defined under the Agreement as net income from continuing operations for the 12 month period then ended determined in accordance with IFRS before interest expense, depreciation, amortization and accretion expenses, all provisions for taxes, all non-cash expenses and non-cash income, the amount of any stock-based compensation; and extraordinary gains and losses.
Ensign Energy Services Inc. is a global leader in oilfield services, headquartered out of Calgary, Alberta, operating in Canada, the United States and internationally. We are one of the world's top land-based drilling and well servicing contractors serving crude oil, natural gas and geothermal operators. Our premium services include contract drilling, directional drilling, underbalanced and managed pressure drilling, rental equipment, well servicing and production services. Please visit our website at www.ensignenergy.com.
Ensign's Common Shares are publicly traded though the facilities of the Toronto Stock Exchange under the trading symbol ESI.
SOURCE Ensign Energy Services Inc.
For further information: Ensign Energy Services Inc., 400 - 5th Avenue S.W., Suite 1000, Calgary, Alberta T2P 0L6 Canada, Mike Gray, Chief Financial Officer, Telephone: (403) 262-1361