Terravest Income Fund announces 2012 second quarter financial results

VEGREVILLE, AB, July 30, 2012 /CNW/ - TerraVest Income Fund (TSX: TI.UN) announced today its second quarter results for 2012.

For the three and six months ended June 30, 2012, the Fund reported:
(thousands of Canadian dollars except per Unit amounts) Three months ended
June 30
Six months ended
June 30
  2012 2011 2012 2011
  $ $ $ $
Sales from continuing operations 15,872 14,366 36,529 33,428
Gross profit from continuing operations 3,890 2,970 9,443 7,540
Income from continuing operations 1,573 475 4,328 1,410
Income (loss) from discontinued operations - (842) - (1,724)
Net Income (loss) and comprehensive income (loss) for the period 1,573 (367) 4,328 (314)
Income per Unit, continuing operations, basic and diluted 0.08 0.02 0.22 0.07
Income (loss) per Unit, discontinued operations, basic and diluted - (0.04) - (0.09)
Income (loss) per Unit, basic and diluted 0.08 (0.02) 0.22 (0.02)
Total assets     87,578 94,929

On a segmented basis sales from continuing operations for the three and six months ended June 30, 2012 were:
(thousands of Canadian dollars) Three months ended June 30 Six months ended June 30
RJV $ 9,658 $ 9,629 $ 22,048 $ 22,204
Diamond   6,214   4,737   14,481   11,224
  $ 15,872 $ 14,366 $ 36,529 $ 33,428

Additional segmented information can be found in the Fund's consolidated financial statements and MD&A which are available on SEDAR at www.sedar.com and through the Fund's website at www.terravestincomefund.com.

As disclosed previously, the trustees and management of the Fund have been actively reviewing options for the maximization of value to the unitholders of their investment in the Fund.  The trustees and management have also reviewed the future strategic direction of the Fund, and, as a result of this review, the board of trustees has determined that it is in the best interests of the Fund and its unitholders at this time to discontinue the previously announced process to review strategic alternatives available to the Fund, and in particular possible liquidity events. The board of trustees believe that, given current market conditions, continuing to operate the remaining two businesses of the Fund will create the most value for unitholders at this time.  The Fund's trustees are also pursuing options for converting the Fund from its current trust structure to a corporation which is expected to be completed prior to December 31, 2012 in order to rely on rules enacted by the federal government that permit conversion on a tax-deferred rollover basis.

On July 11, 2012 the Fund announced it was proceeding with a substantial issuer bid (the "Bid") to acquire from Fund unitholders up to 5,000,000 Units of the Fund at a price of $2.75 per Unit. The Bid is open until August 20, 2012 unless withdrawn or extended by the Fund. Details of the Bid can be found in the Issuer Bid Circular filed on SEDAR at www.sedar.com and through the Fund's website at www.terravestincomefund.com.

About TerraVest Income Fund
The Fund has investments in two portfolio businesses:

  • RJV Gas Field Services ("RJV"), one of Canada's largest providers of wellhead processing equipment for the natural gas industry in western Canada; and
  • Diamond Energy Services ("Diamond"), a market leader in providing well servicing to the oil and natural gas sector in south-western Saskatchewan.

Caution Regarding Forward-Looking Statements
This news release contains forward-looking statements.  All statements other than statements of historical fact contained in this news release are forward-looking statements, including, without limitation, statements regarding our strategic direction and evaluation of the portfolio businesses and the Fund as a whole, the sale or potential sale of portfolio businesses or assets thereof, and other plans and objectives of or involving the Fund. Readers can identify many of these statements by looking for words such as "expects" and "will" and similar words or the negative thereof. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.

By their nature, forward-looking statements require us to make assumptions and, accordingly, forward looking statements are subject to inherent risks and uncertainties. There is significant risk that the forward-looking statements will not prove to be accurate. We caution readers of this news release not to place undue reliance on our forward-looking statements because a number of factors may cause actual future circumstances, results, conditions, actions or events to differ materially from the plans, expectations, estimates or intentions expressed in the forward-looking statements and the assumptions underlying the forward-looking statements. 

Assumptions and analysis about the performance of the Fund as a whole and the Fund's portfolio businesses, the markets in which the portfolio businesses compete and the prospects and values of the portfolio businesses are considered in setting the business plan for the Fund, in evaluating and forecasting tax horizon, capital investments, outlook for operations, financial position, results and cash flow, other plans and objectives and in making related forward-looking statements. Such assumptions include, without limitation, the current tax regime in Canada remaining unchanged and the performance of the continuing portfolio businesses of the fund not differing materially from historic performance. Should any of these factors or assumptions vary, actual results may differ materially from the forward-looking statements.

The information set forth under "Risk Factors" in the annual information form of the Fund dated March 5, 2012 and under "Financial Instruments" in the MD&A of the Fund for the period ended June 30, 2012, identifies risk factors that could affect the operating results and performance of the Fund and its portfolio businesses and the values of the portfolio businesses and the Fund as a whole. We caution that the lists of factors discussed in such information is not exhaustive and that, when relying on forward-looking statements to make decisions with respect to the Fund, investors and others should carefully consider the factors discussed, as well as other uncertainties and potential events, and the inherent risks and uncertainties of forward-looking statements.  The forward-looking statements herein are made based on the assumption that the Fund will not be affected by such risks, but that, if the Fund is affected by such risks, the forward-looking statements may become inaccurate.

The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement.  The forward-looking statements included in this news release are made as of the date of this news release.  Except as required by applicable securities laws, the Fund does not undertake to update such forward-looking statements.


SOURCE: TerraVest Income Fund

For further information:

Dale Laniuk
TerraVest Income Fund
Chief Executive Officer
(780) 632 -7774


Paul A. Casey, CA
TerraVest Income Fund
Chief Financial Officer
(780) 632-2040

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TerraVest Income Fund

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