Impax Energy Services Income Trust

Impax Energy Services Income Trust

August 12, 2008 19:14 ET

Impax Energy Services Income Trust Releases Financial Results for the Second Quarter Ended June 30, 2008

TORONTO, ONTARIO--(Marketwire - Aug. 12, 2008) - Impax Energy Services Income Trust (TSX:MPX.UN) ("Impax" or the "Trust") today announced its financial results for the second quarter ended June 30, 2008.

During the second quarter of 2008, which is the lowest activity quarter of the year, Impax recorded revenue of $5.1 million, EBITDA(1) of $(0.3) million and net loss of $4.3 million.

(in 000's of
Canadian dollars,
except per unit Three months ended June 30, Six months ended June 30,
amounts) 2008 2007 2008 2007
Revenue $5,113 $3,847 $20,283 $21,185
Net loss (4,252) (12,492) (2,143) (8,971)
EBITDA(1) (329) (1,562) 6,055 6,024
distributable cash(1) 1,734 4,997 3,954 8,303
Total assets 102,208 138,477 102,208 138,477
Loss per unit - basic
and diluted $(0.35) $(1.07) $(0.18) $(0.77)

Revenue for the three months ended June 30, 2008 increased by $1.3 million or approximately 33% compared to the same period in 2007, while EBITDA for the same period increased by $1.2 million or approximately 81%. The net loss, in the three months ended June 30, 2007, included a one time non-cash future income tax charge of $8.1 million. Industry activity continued to improve during the second quarter of 2008 and is expected to strengthen through the balance of 2008.


Compared to 2007, the market is now seeing relatively lower natural gas inventory levels and decreased liquefied natural gas imports, with U.S. gas inventories at the beginning of August 2008 at 12% below equivalent levels in August 2007. In addition, on April 23, 2008, the Petroleum Services Association of Canada increased their 2008 drilling forecast by approximately 14% compared to the outlook they made earlier, and reconfirmed this increase on July 25, 2008. Therefore, despite fluctuations in the energy markets due to global economic issues, stronger oil prices and improved natural gas prices give rise to increased optimism for the second half of 2008.

"While our operations will continue to be affected by the normal seasonality of the oil and gas operations in western Canada, particularly as is witnessed in the second quarter due to spring breakup, we believe that the encouraging signs we have begun to see in industry activity levels will continue through 2008 and early 2009," commented Scott Delaney, President and CEO of Impax. "Impax remains focused on the efficient operation of its existing businesses and the reduction of current indebtedness."

Impax Energy Services Income Trust is an open-ended trust, providing oilfield services in western Canada. The Trust indirectly owns an approximate 54% interest in Impax Energy Services Master Limited Partnership, which indirectly acquired and now operates through its subsidiaries the businesses of McClelland Oilfield Rentals Limited Partnership, EGOC Enviro Group Limited Partnership, Denray Rathole Drilling Limited Partnership and Dwayne Hommy Trucking Limited Partnership. These businesses provide services in the areas of oilfield rental, specialized equipment rental, access mat rental, waste management services, rat hole drilling and specialty fluid hauling.

This news release may contain forward-looking statements relating to expected future events and financial and operating results of the Trust that involve risks and uncertainties. Actual results may differ materially from management expectations as projected in such forward-looking statements for a variety of reasons, including market and general economic conditions and the risks and uncertainties detailed in the Trust's March 28, 2008 Annual Information Form filed with the Canadian securities regulatory authorities. Due to the potential impact of these factors, the Trust disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.


(1) As discussed in the Management's Discussion and Analysis, EBITDA and Standardized Distributable Cash are not earnings measures recognized by GAAP and do not have a standardized meaning prescribed by GAAP. References to "EBITDA" are to net earnings before interest expense, income taxes, amortization, impairment charges, unit based compensation and non-controlling interest and references to "Standardized Distributable Cash" are to cash available for distribution to Unitholders in accordance with the distribution policies of the Trust. Management believes that, in addition to net earnings, EBITDA is a useful supplemental measure of both performance and cash available for distribution before debt service, changes in working capital, capital expenditures and income taxes. Standardized Distributable Cash is a measure generally used by income trusts as an indicator of financial performance and is a useful supplemental measure that may assist prospective investors in assessing an investment in the Trust. Management has calculated Standardized Distributable Cash as cash flow from operations including non-cash working capital changes less all capital expenditures net of any proceeds from sales of capital assets. The Trust suspended its distributions in December of 2007.

Additional Financial Information

The unaudited consolidated financial statements with accompanying notes and Management's Discussion and Analysis will be filed on SEDAR.

Contact Information

  • Impax Energy Services Income Trust
    Scott D. Delaney
    President and Chief Executive Officer
    (416) 304-6867