Lockerbie & Hole Announces Record Fiscal 2009 Third Quarter Results

    TSX: LH

    EDMONTON, Jan. 14 /CNW/ - Lockerbie & Hole Inc. (the "Company" or
"Lockerbie") releases results for the three and nine months ended November 30,

                                Three months ended         Nine months ended
                                       November 30,              November 30,
    (unaudited, in thousands,
    except per share amounts)    2008         2007         2008         2007
    Contract revenue         $234,746     $114,152     $493,796     $294,642
    Adjusted EBITDA(1)         15,107        8,194       31,572       26,335
    Net income                  9,964        6,535       20,226       17,290
    Basic earnings per share     0.36         0.23         0.72         0.74
      Active                                            805,700    1,091,300
      Delayed                                           448,200            -
      Total                                           1,253,900    1,091,300

    (1) For a definition of Adjusted EBITDA and Backlog as used in this
        press release, see "Advisories - Non - GAAP Measures" at the end of
        this press release.


    -   Contract Revenue, Adjusted EBITDA and net income were quarterly
        records for the Company.
    -   During the third quarter, Suncor Energy Services Inc. ("Suncor") and
        Fort Hills Energy L.P. announced delays in the construction of their
        oilsands projects. These projects represent $277.6 million and
        $170.6 million in Backlog respectively.
    -   Following the quarter, the Company's Infrastructure segment received
        verbal confirmation that it has been selected as the mechanical
        construction manager on a $160 million contract for the Edmonton
    -   Following the quarter, the Company's Industrial segment received
        written notification from Suncor that its $100 million contract to
        build the Firebag 4 co-generation plant has been suspended until
        February 28, 2009 subject to further notice from Suncor.
    -   The Company increased and extended its credit agreement with its
        bank, increasing its total available borrowing by $10 million to
        $60 million, and extending the agreement until July 2011. The Company
        has $72.2 million in cash and cash equivalents and no bank debt.
    -   The Company purchased and cancelled 1,557,800 common shares under a
        Normal Course Issuer Bid at an average cost of $5.01 per share for a
        total cost of $7.8 million.

    Overall Performance

    Net income for the Company was $10.0 million ($0.36 per share) for the
three months ended November 30, 2008 compared to $6.5 million ($0.23 per
share) for the three months ended November 30, 2007, an increase of $3.5
million (53.8%). For the nine months ended November 30, 2008 net income was
$20.2 million ($0.72 per share) compared to $17.3 million ($0.74 per share)
for the nine months ended November 30, 2007, an increase of $2.9 million
(16.8%). Net income increased from the previous year due to an increase in
contract revenue earned from major oilsands related projects and the reduction
of general and administrative expenses as a percentage of revenue.
    Adjusted EBITDA was $15.1 million, an increase of $6.9 million (84.1%),
compared to $8.2 million over the same three month period in fiscal 2008 and
was $31.6 million, an increase of $5.3 million (20.2%), compared to $26.3
million over the same nine month period in fiscal 2008. As revenue increased,
over the same period in the previous fiscal year, Adjusted EBITDA also
    For a definition of Adjusted EBITDA as used in this press release, see
"Advisories - Non - GAAP Measures" at the end of this press release.


    The outlook for the Company remains positive in the context of a volatile
world economy. The Company has $72.2 million in cash and cash equivalents,
$60.0 million in available cash from its credit agreement, and no bank debt.
In the short-term, the Company will be focused on executing its Backlog,
including $437.3 million in the Infrastructure segment, and pursuing a number
of opportunities in the mining, municipal and institutional market sectors.
Infrastructure spending will likely remain strong in Canada as governments are
expected to use infrastructure spending as a stimulus to help revitalize the
economy. In the long-term, the Company believes new opportunities in the
oilsands market in western Canada will materialize and that it is well
positioned to capitalize on opportunities within this market.

    Third Quarter Fiscal 2009 Financial Statements and MD&A

    Lockerbie will file its third quarter fiscal 2009 financial statements
and management's discussion and analysis ("MD&A") for such period on the
System for Electronic Document Analysis and Retrieval ("SEDAR") at under the Company's profile on Wednesday, January 14, 2009. Such
financial statements and MD&A will also be available on Lockerbie's website at on the same date.

    Third Quarter Fiscal 2009 Conference Call

    As previously announced, Gordon L. Panas, President and Chief Executive
Officer, and Michael G. Slapman, Chief Financial Officer, will host a
conference call to discuss the third quarter fiscal 2009 results on Thursday,
January 15, 2009 at 9:00 a.m. MDT (11:00 a.m. EDT). Interested parties are
encouraged to participate by calling (800) 733-7560 or (416) 644-3428 (in
Toronto, Ont.) at least ten minutes before the start of the call in order to
participate. For those unable to phone into the live call, a replay will be
available up to 14 days after the event at (416) 640-1917 (in Toronto) or
(877) 289-8525, passcode 21284974 followed by the pound sign, and on Lockerbie

    About Lockerbie

    Lockerbie was founded in 1898 and is one of the largest mechanical
construction contractors in Canada. Lockerbie is a multi-disciplined
contractor providing mechanical, electrical, instrumentation, pipe
fabrication, module assembly, boiler erection, insulation and civil
construction services primarily to the oilsands, mining, institutional,
municipal and commercial market sectors. Lockerbie is headquartered in
Edmonton, Alberta.


    Non-GAAP Measures

    "Adjusted EBITDA" represents income before interest expense and bank
charges, interest income, income taxes, depreciation, and discontinued
operations. Adjusted EBITDA is not a recognized performance measure under GAAP
and does not have a standardized meaning prescribed by GAAP. The Company
believes that Adjusted EBITDA is a useful complementary measure of pre-tax
profitability commonly used by the financial and investment community for
valuation purposes. The most directly comparable measure to Adjusted EBITDA
calculated in accordance with GAAP is net income. For a reconciliation of the
Company's Adjusted EBITDA to net income, see the Company's MD&A which will be
available on SEDAR and on Lockerbie's website at on
January 14, 2009.

    "Backlog" means the total value of work that has not yet been completed
that: (a) is assessed by the Company as having a high certainty of being
performed by the Company or its subsidiaries by either the existence of an
executed contract or work order specifying job scope, value and timing; or (b)
has been awarded to the Company or its subsidiaries, as evidenced by an
executed binding or non-binding letter of intent or agreement, describing the
general job scope, value and timing of such work, and with the finalization of
a formal contract respecting such work currently assessed by the Company's
management as being reasonably assured. Backlog is classified as active unless
the Company has received written notification from the client delaying the
contract, at which point it is classified as delayed. Backlog is not a
recognized performance measure under GAAP and does not have any standardized
meaning prescribed by GAAP. The Company believes that Backlog is a useful
complementary measure of projected activity in future periods commonly used by
management to evaluate the Company's projected activity in future periods.
There is no direct comparable measure to Backlog in GAAP.

    Forward Looking Statements

    This press release contains statements concerning Lockerbie's outlook and
expectations for its future performance, the outlook for the oilsands and
infrastructure markets, Backlog, the expected value and receipt of the
Edmonton Clinic project and the timing of a contract for such a project being
entered into, Lockerbie's business plan and objectives and other expectations,
plans, goals, objectives, assumptions, information or statements about future
events or conditions that may constitute forward-looking statements or
information under applicable securities legislation. Such forward-looking
statements or information are based on a number of assumptions, which may
prove to be incorrect. Assumptions have been made regarding, among other
things, the successful implementation of Lockerbie's business plan, the
availability to Lockerbie of qualified personnel, the continuation and
completion of the projects forming Lockerbie's Backlog, oil and gas prices,
and general economic, business and market conditions. Although Lockerbie
believes that the expectations reflected in such forward-looking statements or
information are reasonable, undue reliance should not be placed on
forward-looking statements because Lockerbie can give no assurance that such
expectations will prove to be correct. The forward-looking statements are
based on Lockerbie's current expectations, estimates and projections, and are
subject to a number of significant risks and uncertainties that could cause
actual results to differ materially from those anticipated. Such risks and
uncertainties include, among others, Lockerbie's ability to be retained for
existing and new project work by existing and new clients, Lockerbie's ability
to retain and hire qualified personnel required, oil and gas prices, the
suspension, delay or cancellation of current projects forming Lockerbie's
Backlog, general economic, business and market conditions and other risks as
are detailed from time to time in continuous disclosure filings of Lockerbie.
Should one or more of these risks or uncertainties materialize, or should
assumptions underlying the forward-looking statements prove incorrect, actual
results may vary materially from those described herein as anticipated,
believed, estimated or expected. These forward-looking statements are made as
of the date of this press release, and Lockerbie assumes no obligation to
update or revise them to reflect new events or circumstances, except as
required by applicable laws.

    %SEDAR: 00025533E

For further information:

For further information: Gordon L. Panas, President & Chief Executive
Officer, or Michael G. Slapman, Chief Financial Officer at: Telephone: (780)
452-1250, Fax: (780) 452-1284, Website:

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