Cabo Drilling Announces Second Quarter Results
(firmenpresse) - NEW WESTMINSTER, BRITISH COLUMBIA -- (Marketwired) -- 03/01/16 -- Cabo Drilling Corp. ("Cabo" or the "Company") (TSX VENTURE: CBE)(FRANKFURT: DHL) reports the results for its second quarter of fiscal year 2016, ended December 31, 2015.
2nd QUARTER HIGHLIGHTS
The Company reports:
"Cabo Drilling generated revenues of $8.90 million during the first six months of fiscal 2016," stated Mr. Versfelt, Cabo's President & CEO. "This represents a 16% increase compared to the $7.67 million recorded in the comparable period in fiscal 2015."
"Gross margin, adjusted to include depreciation, was 12.4% or $1.10 million in the first six months of fiscal 2016, as compared to 11.0% in the first six months of fiscal 2015," stated Mr. Versfelt. "In accordance with IFRS, depreciation expenses of $896,097 are included in direct costs for the six months ended December 31, 2015, as compared to $1.11 million in the first six months of fiscal 2015. Adjusted gross margin, when depreciation expense is excluded from direct costs, is 22.5% in the first six months of fiscal 2016, as compared to 25.5% in first quarter of fiscal 2015."
"General and administration costs decreased by 9% to $1.69 million when compared to the $1.86 in fiscal 2015. The decrease is a direct result of restructuring activities that began in fiscal 2013 and continued into fiscal 2016," commented Mr. Versfelt.
"Total liabilities increased by $82,366 during the first six months of fiscal 2016 to $12.26 million at December 31, 2015," Mr. Versfelt noted. "At the end of the current quarter, the Company has $26,506,000 in tax losses expiring primarily between 2025-2035."
"Effective July 7, 2015, the Company entered into the infrastructure services industry, with its purchase of WorldWide EnviroChem Corporation. As a result of this transaction, Cabo will hold the exclusive rights to distribute the proprietary RoadMaster (Superpave) and BondMaster (Supercrete) product lines used in road building and waterproofing of underground and water exposed concrete, to road contractors, precast concrete manufacturers, concrete contractors and ready-mix suppliers throughout North, Central and South America, excluding Chile, but including the Caribbean, plus Southern Africa, including South Africa, Namibia, Botswana, Zambia and Malawi," explained Mr. Versfelt.
Mr. Versfelt noted that "the Company has engaged financial advisors to assist in refinancing or replacing $2.705 million in debentures and a $1.4 million equipment loan, plus interest, the repayments of which were due in May, 2015. The Company is in arrears on its debenture and equipment loan interest payments. The Company is currently in second stage discussions for no less than $6.0 million in debt financing to replace the $1.4 million lender and the debenture loans. It is also exploring additional finance opportunities in Central America and Canada to continue the restructuring of the Company's debenture debt."
"The Company reports positive EBITDA of $397,279 during the first six months of fiscal 2016, compared to $98,800 during the first six months of fiscal 2015" stated Mr. Versfelt.
Mr. Versfelt observed that "54% of the second quarter, fiscal 2016, revenues came from gold related projects, 42% from copper, and the remaining 4% from other base metals."
"Our safety record is one of the best in the industry and our client relationships are very good," commented John Versfelt. "We believe that expansion into infrastructure services in 2016 will enhance Cabo's operations in 2016, particularly in Latin America."
Consolidated Quarterly Financial Results
Revenue for the quarter ending December 31, 2015, increased $1.48 million, or 39%, to $5.26 million, compared to $3.78 million in the second quarter of fiscal 2015. The primary reason for the increase is due to increased drill utilization in our Ontario division and increased tree falling and clearing services provided in our Latin American division. Latin America division revenues increased by 95% due to these additional services provided to our primary client in Latin America. The Canadian and USA divisions recorded a significant increase in revenues of 64% to $2.88 million in the second quarter of fiscal 2016, as compared to $1.76 million in the comparable period in fiscal 2015. These increases were somewhat offset by the decreased activity in Europe with an 81% decrease in the second quarter of fiscal 2016.
Revenues from surface services increased 105%, from $1.95 million in the second quarter of fiscal 2015 to $4.01 million in the second quarter of fiscal 2016, primarily due to the increased drill utilization in the Ontario division and additional service revenue in the Latin American division. Underground drilling decreased by 43% in the second quarter of fiscal 2016 to $1.01 million as compared to $1.79 million in the comparable period in fiscal 2015, primarily as a result of a the decreased drill utilization in Europe.
Direct costs for the quarter ended December 31, 2015, were $4.50 million compared to $3.36 million in the quarter ending December 31, 2014, as adjusted to include depreciation, in accordance with IFRS. The increase is a direct result of the increased activity in fiscal 2016. Gross margins, under IFRS reporting, for the quarter ended December 31, 2015, were 14.5% compared to 11.3% during the quarter ending December 31, 2014. Adjusted gross margin to exclude deprecation for the second quarter of fiscal 2016 is 22.8% as compared to 25.3% in the second quarter of fiscal 2015.
General and administrative expenses decreased by $30,089 from $912,543 for the second quarter of fiscal 2015 to $882,454 in the second quarter of fiscal 2016. The Company recorded an allowance for doubtful accounts of $40,000 during the second quarter of fiscal 2016 as compared to nil in the second quarter of fiscal 2015. The Company made significant expense reductions in fiscal 2015, but continues to look for other cost savings. The decreases were a direct result of reduced administration staff, lower investor relations costs, lower insurance and professional fees and lower office administration costs in all divisions. Our salary costs have decreased by 52% from the comparable period in fiscal 2015.
Net loss for the second quarter of fiscal 2016 is $368,195 compared to a net loss of $656,576 in the second quarter of fiscal 2015.
The extraordinary downward slide in exploration, development and geotechnical demand for drilling services since 2012, plus the severe challenges we experienced with substantially reduced meter and hourly price rates, reduced Cabo's gross revenue in the first nine months of 2015 to the lowest levels that Cabo has experienced in its history; however, in the last three months of 2015, Cabo experienced an improvement largely as a result of increased tree falling and clearing work. We are not expecting a dramatic turnaround in the industry for the next year, but we are budgeting for some improvement similar to 2002/2003 levels. The business conditions in 2012 - 2015 have caused cash flow challenges for drilling services companies, many of whom, including Cabo, have had to work with their lenders to obtain loan payment extensions and renegotiate terms and conditions with existing financial companies, while seeking new financing facilities.
The Company is expanding its mining sector business into the infrastructure sector. This will, over time, include offering drill and blast, geotechnical services, tree cutting and clearing services, and other services in road building, for the general contracting sector, the pipeline sector, the hydropower sector and the oil & gas sector.
About Cabo Drilling Corp. (TSX VENTURE: CBE)
Cabo Drilling Corp. is a drilling services company headquartered in New Westminster, British Columbia, Canada. The Company provides mining specialty drilling services through its divisions in Kirkland Lake, Ontario, Canada, with branches in Surrey, British Columbia and Springdale, Newfoundland; as well as Cabo Drilling (America); Cabo Drilling (Panama) Corp.; Balkan States Drilling SH.P.K. of Tirana, Albania; and Cabo Drilling (International) Inc. The Company's common shares trade on the Frankfurt Exchange under the symbol: DHL and on the TSX Venture Exchange under the symbol: CBE.
ON BEHALF OF THE BOARD
John A. Versfelt, Chairman, President and CEO
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, potential mineral recovery processes and other business transactions timing. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.
Contacts:
Cabo Drilling Corp.
Ms. Jolene Timmer
Corporate Communications
(604) 527-4201
Cabo Drilling Corp.
Mr. John A. Versfelt
Chairman, President and CEO
(604) 527-4201
Cabo Drilling Corp.
(604) 527-4201
(604) 527-9126 (FAX)
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Datum: 01.03.2016 - 13:45 Uhr
Sprache: Deutsch
News-ID 454296
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