TSX Venture Exchange Symbol "BRY"
EDMONTON, Aug. 29 /CNW/ - Bri-Chem Corp. (the "Company") (TSX Venture
Exchange: BRY) a leading Canadian wholesale distributor of drilling fluids,
products and services, today announced its financial results for the second
quarter ended June 30, 2007. As a result of the reverse take-over by
amalgamation with Gwelan Supply Ltd. effective January 1, 2007, the
comparative financial figures reflect those of consolidated Gwelan Supply Ltd.
operating as a private company and certain of the prior period's figures have
been reclassified to conform to the presentation of the current period
consolidated financial statements. A complete copy of the Company's report is
available on the Internet at www.sedar.com.
Net loss from operations for the three months ended June 30, 2007 is
$101,791 or $(0.01) fully diluted loss per share and earnings before interest,
taxes, depreciation and amortization for the same period are $336,719.
Consolidated revenues were $6,135,841 during the second quarter of 2007, a
decline of 45.6% when compared to the same period last year.
Net earnings from operations for the six months ended June 30, 2007 are
$798,714 or $0.07 fully diluted earnings per share and earnings before
interest, taxes, depreciation and amortization for the same period are
$1,649,716. Consolidated revenues were $19,272,097 for the six months ended
June 30, 2007, a decline of 44.1% when compared to the same period last year.
The decline in Company revenue resulted from sharply lower gas drilling
activity, adverse weather conditions, and extended spring break up in the
Company's operating regions. During the second quarter, drilling activity,
based on drilling operating days, was off 47% during the second quarter and
28% for the first six months of 2007 compared to the same periods of 2006 as
drilling rig utilization rates declined to 17% from 42%. Traditionally, the
Company's busiest region for the first half of the drilling season has been
the north eastern portion of British Columbia, or more specifically, the Fort
Nelson area and the Fort St. John area. These areas have, in the past,
produced a large portion of overall winter and spring sales. The drilling
programs were drastically cut in both Fort Nelson and Fort St. John. With
respect to the Alberta warehouses, the Company has realized a decline in
revenues of approximately 24%, which is consistent with the decline in overall
drilling activity in Western Canada.
Due to the impact of lower natural gas prices, natural gas drilling
activity in Western Canada is not expected to return to historical levels in
the near-term. The Company will rely on sales to its strong customer base to
support its operations and will continue to focus on prudently managing
operating costs. Notwithstanding the decline in drilling activity during the
second quarter 2007, early into the third quarter of 2007, we are cautiously
optimistic that we will experience closer to historical levels of activity for
the quarter with a recent strong resurgence in sales of our drilling fluids.
The Company recently announced the acquisition of Millennium Technologies
Ltd., a Western Canadian-based full-service chemical products wholesaler. This
is a strategic move for the Company as Millennium and its operations in
Saskatchewan bring the Company a step closer to providing complete territorial
coverage for our customers along with inventory warehouse consolidation.
The Company operates out of its head office located in Acheson, Alberta
and its principal activity is the wholesale/distribution blending and
packaging of drilling fluid supplies for the oil and gas industry. The Company
provides over 100 domestic and foreign products to customers throughout
Alberta, British Columbia and Saskatchewan.
Forward Looking Statements
Certain statements contained in this press release, including statements
which may contain words such as "could", "should", "expect", "anticipate",
"believe", "will", and similar expressions and statements relating to matters
that are not historical facts are forward looking statements. Such forward
looking statements involve known and unknown risks and uncertainties which may
cause the actual results, performances or achievements of Bri-Chem Corp. to be
materially different from any future results, performances or achievements
expressed or implied by such forward looking statements. Such factors include,
but are not limited to, fluctuations in oil and gas activity levels, political
and economic conditions, and the demand for products provided by Bri-Chem
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
For further information:
For further information: Don Caron, T: (780) 420-6885, F: (780)