Central Alberta Well Services Corp.
TSX VENTURE : CWC

Central Alberta Well Services Corp.

August 30, 2010 12:01 ET

Central Alberta Well Services Releases Second Quarter 2010 Financial Results

CALGARY, ALBERTA--(Marketwire - Aug. 30, 2010) - Central Alberta Well Services Corp. ("CWC" or the "Corporation") (TSX VENTURE:CWC) announces its second quarter 2010 financial results. The interim Financial Statements and Management's Discussion and Analysis ("MD&A") for the quarter ended June 30, 2010 are filed on SEDAR at www.sedar.com.

Quarter Highlights

  • Revenues increased to $9.25 million in 2010 from $6.40 million in 2009, reflecting increased equipment utilization across all of the Corporation's business segments.
  • EBITDAS improved to $0.33 million in the second quarter of 2010 from ($1.49) million in the same period of 2009.
  • Refinancing of $30 million of term debt and the placement of $10 million in new operating loan facilities. At June 30, 2010 the Corporation had reduced its term debt to 32% of equity, leaving it well positioned to finance growth as the demand for energy services improves.

Second Quarter Review

The Corporation's focus on marketing to larger oil producers and its strategic deployment of assets to oil-rich plays in Northern Alberta and South Eastern Saskatchewan continues to prove successful, as indicated by the improvement in Well Servicing Segment revenues to $6.9 million, an increase of 53% over the same period in 2009.

The Corporation continues to explore cost saving measures through on-going review of operations and support structures. The Corporation strives to be competitive in the industry without sacrificing the safety of employees, the customer's assets or the profitability of the Corporation in a very competitive market.

Outlook

During the first half of 2010, the Corporation focused on implementing cost control measures and achieving operational efficiencies together with improving its balance sheet in anticipation of strengthening market conditions. The Corporation believes that activity in the energy sector will gradually improve over the last half of 2010 resulting in higher utilization and profit margins. The Corporation has positioned itself to capitalize on stronger oil prices with the expansion and relocation of equipment to its new facilities in Grande Prairie, Alberta and Weyburn, Saskatchewan, where activity is expected to improve earliest and remain robust through the end of 2010 and into 2011.

With natural gas production remaining strong in Canada and the United States and storage levels near 5 year highs, the Corporation believes the recovery of natural gas prices and resulting improvement in well servicing activity will occur gradually in the near future. The Corporation continues to seek opportunities to increase utilization of its equipment and is actively cross-selling services in its Other Oilfield Services Segment in an effort to improve market share as well as to enhance profitability at reduced activity levels.

CWC enters the second half of 2010 with an improved competitive position, stronger balance sheet and a new and active Board of Directors which will give the Corporation a fresh outlook at opportunities. The Corporation is financially and operationally well-positioned to take advantage of the improvements in the industry through the remainder of 2010 and into the active first quarter of 2011 while maintaining its focus on safety for its employees and customers.

About Central Alberta Well Services

Central Alberta Well Services provides oilfield services, including well servicing, coil tubing, snubbing, nitrogen, well testing and oilfield equipment rentals to oil and gas companies operating in the Western Canadian Sedimentary Basin. The Corporation has its corporate office in Calgary, Alberta, with its operational head office in Red Deer, Alberta, and additional operating centres in Provost, Alberta, Brooks, Alberta, Grande Prairie, Alberta and a recently opened satellite facility in Weyburn, Saskatchewan.

READER ADVISORY

Certain statements contained in this press release, including statements which may contain such words as "could", "should", "believe", "expect", "will", and similar expressions and statements relating to matters that are not historical facts are forward-looking statements, including, but not limited to, statements as to: future capital expenditures, including the amount and nature thereof; revenue growth; equipment additions; business strategy; expansion and growth of the Corporation's business and operations; service rig utilization rates, outlook for natural gas prices and general market conditions and other matters. Management has made certain assumptions and analyses which reflect their experiences and knowledge in the industry, including, without limitations, assumptions pertaining to well services demand as a result of commodity prices. These assumptions and analyses are believed to be accurate and truthful at the time, but the Corporation cannot assure readers that actual results will be consistent with these forward-looking statements. However, whether actual results, performance or achievements will conform to the Corporation's expectations and predictions is subject to known and unknown risks and uncertainties which could cause actual results to differ materially from the Corporation's expectations. All forward-looking statements made in the press release are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Corporation will be realized or, even if substantially realized, that they will have the expected outcomes to, or effects on, the Corporation or its business operations. The Corporation does not intend and does not assume any obligation to update these forward-looking statements, except as expressly required to do so pursuant to applicable securities laws. Any forward-looking statements made previously may be inaccurate now.

EBITDAS is calculated from the statement of income (loss) as revenue less operating costs and general and administrative expenses, and is used to assist management and investors in assessing the Corporation's ability to generate cash from operations. EBITDAS is a non-GAAP measure and does not have any standardized meaning prescribed by GAAP and may not be comparable to similar measures provided by other companies.

Common Shares: 158,739,363

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Central Alberta Well Services Corp.
    Darryl E. Wilson
    President & Chief Executive Officer
    (403) 264-2177
    darrylwilson@cawsc.com
    or
    Central Alberta Well Services Corp.
    Darcy A. Campbell, CMA
    Vice-President, Finance and Chief Financial Officer
    (403) 264-2177
    darcycampbell@cawsc.com
    or
    Central Alberta Well Services Corp.
    755, 255 - 5 Avenue SW
    Calgary, Alberta T2P 3G6