DENVER, CO — (Marketwired) — 05/02/13 — ENSERVCO Corporation (OTCQB: ENSV)
ENSERVCO Corporation (OTCQB: ENSV), a provider of well-site services to the domestic onshore conventional and unconventional oil and gas industries, today announced record revenue and earnings** for its first quarter ended March 31, 2013.
First quarter revenue increased 95% to a record $18.6 million from $9.5 million the first quarter last year, and a 65% increase over the previous quarterly revenue record of $11.3 million, which came in the fourth quarter of 2012. The increase was fueled by strong demand for ENSERVCO–s well enhancement services (frac heating, hot oiling, acidizing and pressure testing). Well enhancement revenue increased 125% to $16.5 million from $7.3 million in last year–s first quarter. Revenue from fluid management services (water hauling/disposal and frac tank rentals) was $1.9 million, down from $2.1 million in the 2012 first quarter.
Gross margin improved to 44% from 31% in the prior year–s first quarter. Operating income was $6.7 million versus $721,000 in the first quarter a year ago, while income from continuing operations was $4.0 million, or $0.11 per diluted share, up from $379,000, or $0.01 per diluted share, in the first quarter of 2012. In addition to the strong revenue growth, the Company–s earnings reflected a $759,000 decrease in depreciation expense versus the first quarter last year, which was primarily due to a reassessment of the estimated useful lives of its trucks, equipment and disposal wells.
First quarter adjusted EBITDA* increased 251% to $7.3 million from $2.1 million in the 2012 first quarter.
“Our first quarter financial results reflect the rapid evolution of our business during recent quarters,” said Rick Kasch, president. “A strong increase in our frac heating and hot oiling capacity combined with normal weather across our expanded service territory led to the sharp increase in first quarter revenue, as well as a very strong improvement in earnings. Our first quarter adjusted EBITDA* nearly equaled our strongest full-year performance of $7.5 million in 2008.
“Cold temperatures have continued into the spring in many of our service regions, and this has led to a strong start to the second quarter. We expect demand for our frac heating, hot oiling and well maintenance services to show meaningful improvements during the second and third quarters versus the same periods in 2012. These expectations are based on our broader customer base and our move into regions where fluid heating work can last most of the year.”
One such region is North Dakota–s Williston Basin. Kasch said the Company last week entered into an agreement to provide well-enhancement equipment and services to Warrior LLC, a tribal-member-owned energy service company operating on the Fort Berthold Indian Reservation. The nearly million-acre reservation sits in the heart of a large and very active production region where operators are principally targeting the Bakken formation. As part of an effort to expand its service offering, Warrior has partnered with ENSERVCO.
“Our relationship with Warrior could represent a significant increase in activity out of our Killdeer, North Dakota facility,” Kasch added. “We look forward to working with the company to offer our well enhancement services to new customers.”
Kasch said management is taking additional steps to boost revenue during the summer season. “We are working aggressively to grow our core well maintenance services, such as acidizing and pressure testing, and continue to explore new offerings that could be added through acquisition. Given our strong start to the year and much improved working capital position, we are optimistic 2013 will be another year of record results for ENSERVCO.”
Management will hold a conference call to discuss these results. The call will begin at 1 p.m. Eastern (11 a.m. Mountain) and will be accessible by dialing 877-407-8033 (201-689-8033 for international callers). No passcode is necessary. A telephonic replay will be available through May 8, 2013, by calling 877-660-6853 (201-612-7415 for international callers) and entering the Conference ID #413079. To listen to the webcast, participants should access the ENSERVCO website, located at , and link to the “Investors” page at least 15 minutes early to register and download any necessary audio software. A replay of the webcast will be available for 90 days.
Through its various operating subsidiaries, ENSERVCO has emerged as one of the energy service industry–s leading providers of hot oiling, acidizing, frac heating and fluid management services. The Company owns and operates a fleet of more than 230 specialized trucks, trailers, frac tanks and related well-site equipment. ENSERVCO serves customers in six major domestic oil and gas fields, and operates in Colorado, Kansas, Montana, New Mexico, North Dakota, Oklahoma, Pennsylvania, Ohio, Texas, Wyoming and West Virginia. Additional information is available at .
This press release and the accompanying tables include a discussion of EBITDA and Adjusted EBITDA, which are non-GAAP financial measures provided as a complement to the results provided in accordance with generally accepted accounting principles (“GAAP”). The term “EBITDA” refers to a financial measure that we define as earnings plus or minus net interest plus taxes, depreciation and amortization. Adjusted EBITDA excludes from EBITDA stock-based compensation and, when appropriate, other items that management does not utilize in assessing ENSERVCO–s operating performance (as further described in the attached financial schedules). None of these non-GAAP financial measures are recognized terms under GAAP and do not purport to be an alternative to net income as an indicator of operating performance or any other GAAP measure. We have reconciled Adjusted EBITDA to GAAP net income in the Consolidated Statements of Operations table at the end of this release. We intend to continue to provide these non-GAAP financial measures as part of our future earnings discussions and, therefore, the inclusion of these non-GAAP financial measures will provide consistency in our financial reporting.
**All revenue and earnings results discussed herein exclude discontinued operations, which resulted in pretax losses of $119,000 and $165,000 for the first quarters of 2013 and 2012, respectively.
This news release contains information that is “forward-looking” in that it describes events and conditions ENSERVCO reasonably expects to occur in the future. Expectations for the future performance of ENSERVCO are dependent upon a number of factors, and there can be no assurance that ENSERVCO will achieve the results as contemplated herein. Certain statements contained in this release using the terms “may,” “expects to,” and other terms denoting future possibilities, are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks, which are beyond ENSERVCO–s ability to predict, or control and which may cause actual results to differ materially from the projections or estimates contained herein. Among these risks are those set forth in a Form 10-K filed on March 28, 2013. It is important that each person reviewing this release understand the significant risks attendant to the operations of ENSERVCO. ENSERVCO disclaims any obligation to update any forward-looking statement made herein.
Pfeiffer High Investor Relations, Inc.
Geoff High
Phone 303-393-7044
Email:
Web:
MZ Group
Derek Gradwell
SVP
Natural Resources
Phone: 949-259-4995
Email:
Web: