Revenue nearly doubles over prior year quarter
HOUSTON and CALGARY, Aug. 14 /CNW/ - Production Enhancement Group, Inc.
(TSX: WIS) ("PEG" or the "Company") today announced financial and operating
results for the three months and six months ended June 30, 2007. The Company's
2007 second quarter revenue was US$8.8 million, a 92% increase over the 2006
second quarter and a 12% sequential increase over the 2007 first quarter
revenue of US$7.8 million. The Company also had a full quarter of operating
results from its new wireline services division which contributed
US$1.6 million total revenue during the second quarter of 2007.
EBITDAS(1) for the 2007 second quarter increased 405% and net loss before
income tax benefit decreased 8% as compared to the 2006 second quarter. The
EBITDAS improvement over the second quarter last year is primarily
attributable to improved utilization for the quarter of the three new units at
the coiled tubing division and increased day rates. Earnings per share
remained the same compared to the 2006 second quarter, although average shares
outstanding increased 14%.
"We have continued to execute on our strategy of organically growing the
scale of our operations through additional units and expanding our geographic
and service offerings by our acquisitions of Wireline Specialists of
Louisiana, Inc. in March 2007 and Dyna Star Energy Services Ltd., (a Western
Canadian company that provides coiled tubing and nitrogen services in Alberta,
Canada) in April 2007," said Philip C. Crawford, PEG's Chief Executive
Officer. "We believe that this larger scale of operations and service
offerings, supported by ongoing commitment of equipment expansion, provides
the solid base for continued improvement in our operating and financial
"In April 2007, we announced our intention of expanding our services
internationally through a signed joint venture with Al Qahtani Maritime & Oil
Field Services Co. to begin operations in Saudi Arabia with future expansion
opportunities throughout the Middle East," said Crawford. "We are excited
about the prospects for PEG and I look forward to reporting on our progress
towards our growth plans."
The Company had cash and cash equivalents of US$221,541 as at June 30,
2007, compared to USD$7.1 million at June 30, 2006 and US$1.1 million as at
December 31, 2006. Net cash provided (used) by operating activities before
changes in non-cash working capital was US$123,784 for the second quarter of
2007 compared to US$ (556,993) for the second quarter of 2006. The Company
undertook an aggressive capital asset expansion plan that began in the second
quarter of 2006 and continued through the second quarter of 2007. The majority
of the capital expenditures relate to costs associated with the manufacture of
coiled tubing units and pressure pumping equipment.
For a complete copy of PEG's 2007 second quarter financial statements and
management's discussion and analysis, please visit www.sedar.com or PEG's
website at www.productionenhancement.com.
(1) EBITDAS means earnings from continuing operations before interest,
taxes, amortization, and stock based compensation. Readers are cautioned
that EBITDAS is generally regarded as an indirect measure of operating
cash flow, and, as such, the Company believes it is a significant
indicator of success of public companies, and is particularly relevant to
readers within the investment community. This measure does not have any
standardized meaning prescribed by Canadian generally accepted accounting
principles and may not be comparable to similar measures presented by
other companies; however, PEG is consistent in its calculation of EBITDAS
for each reporting period.
About Production Enhancement Group
Production Enhancement Group, a Houston-based energy services company
incorporated in Alberta, Canada, trades on the TSX under the symbol WIS. PEG's
wholly owned subsidiary, WISE Well Intervention Services, Inc., has developed
patented WISE(R) multifunction coiled tubing technologies and markets a full
range of coiled tubing and pressure pumping services.
WISE(R) is a trademark of Production Enhancement Group, Inc.
The TSX does not accept responsibility for the adequacy or accuracy of
This release and PEG's website referenced in this release may contain
forward-looking statements, including expectations of future components of
cash flow and earnings. Investors are cautioned that assumptions used in the
preparation of such information may prove to be incorrect. Events or
circumstances may cause actual results to differ materially from those
predicted, a result of numerous known and unknown risks, uncertainties, and
other factors, many of which are beyond the control of PEG. These risks
include, but are not limited to the risks associated with the oil and gas
industry, commodity prices, and exchange rate changes. Industry related risks
could include, but are not limited to operational risks in exploration,
development, and production, delays or changes in plans, and health and safety
risks, including, without limitation, costs and expenses. The risks outlined
above should not be construed as exhaustive. Investors are cautioned not to
place undue reliance on any forward-looking information. PEG undertakes no
obligation to update or revise any forward-looking statements.
For further information:
For further information: visit www.productionenhancement.com or contact:
Douglas Parker, Chief Financial Officer, Production Enhancement Group, Inc.,
(281) 282-1851, email@example.com; Ken Wetherell, Investor
Relations, Bryan Mills Iradesso, (403) 503-0144 x224, firstname.lastname@example.org