Enterprise Oilfield Group, Inc.

Enterprise Oilfield Group, Inc.

March 28, 2008 09:00 ET

Enterprise Oilfield Group, Inc. Announces 2007 Year End Results

ST. ALBERT, ALBERTA--(Marketwire - March 28, 2008) - Enterprise Oilfield Group, Inc. (TSX:E)

The Company has changed its fiscal year end to December 31 from September 30 commencing with the fifteen month period ended December 31, 2007.

The Company realized revenue of $10.5 million for the three-month period ending December 31, 2007 and $47.3 million for the 15 months ended December 31, 2007 versus $4.7 million and $37.0 million respectively for the comparative periods in 2006. The Company had EBITDAS of $5.8 million and net earnings of $0.9 million during the 15-month period ended December 31, 2007 compared to EBITDAS of $4.7 million and net earnings of $2.0 million for the 15-month period ended December 31, 2006. Enterprise had positive EBITDAS of $1.4 million and a loss of $0.4 million during the 3-month period ended December 31, 2007 compared to negative EBITDAS of $0.1 million and a loss of $0.6 million for the 3-month period ended December 31, 2006. Earnings were negatively impacted by higher amortization costs associated with the growth in assets, professional fees associated with completing and evaluating prospective acquisitions and the Company's graduation to the TSX, as well as higher costs to operate an expanding branch office network.

During the last 3 months of 2007, the Company, as with many of its oilfield services sector peers and competitors, experienced lower than normal utilization rates. This was due to continued depressed pricing for natural gas, the uncertainty created by the Alberta Royalty decision, and the resultant decrease in drilling activity. The acquisition of TC Backhoe & Directional Drilling and subsequent expansion to infrastructure services with the establishment of the Utility and Directional Drilling division has proven very timely and will continue to allow Enterprise to weather the softness in the energy industry. During this time the Utility and Directional Drilling business unit has generated almost three times the gross margin generated by the Energy and Construction Services business unit. The Utility and Directional Drilling business unit derives approximately 80% of its revenues from outside the oil and gas industry. However, management expects to extract tangible synergy from Utility and Directional Drilling services in its conventional Energy and Construction Services operations. EBITDAS increased by $1.5 million during the last three months of fiscal 2007 relative to the same quarter last year, and for the 15-month period increased 25%. This is reflective of the higher operating margins provided by the Company's Utility and Directional Drilling business unit. This is very positive in the face of uncertain oil patch operating conditions, as the Company continues to assign additional resources to its Utility and Directional Drilling segment.

The Company's asset base grew substantially during the past year, increasing 63% to more than $42.6 million. Enterprise has invested more than $12 million over the past 9 months through a combination of equity and debt financings. These investments have provided the Company with significant opportunities to continue its growth mandate balanced by a diversity of revenue streams.

Jason R. D. Krueger has joined Enterprise Oilfield's board of directors. Mr. Krueger holds a Bachelor of Commerce degree from the University of Calgary, the Chartered Financial Analyst (CFA) designation and has more than 15 years of experience in the energy sector. He also serves on the board of directors for another public company and a charitable organization.

Enterprise's President and CEO, Leonard Jaroszuk, said: "It is our pleasure to welcome Mr. Krueger to our board of directors. We expect that his experience and insight will prove a valuable addition to our Company as we continue to expand".

Michael S. Aberant has resigned as a member of Enterprise's board of directors effective immediately. The Company thanks Mr. Aberant for his contributions to Enterprise's growth.

Enterprise Oilfield Group, Inc. is an energy services company operating in the pipeline construction industry. The Company's focus is small to medium diameter pipeline construction primarily on steel gathering systems up to 12" in diameter. The Company's strategy is to acquire small to mid-size pipeline construction and complementary service companies in central and northern Alberta, consolidating capital, management and human resources to support continued growth.

1 EBITDAS = Earnings Before Income Tax, Depreciation, Amortization and Stock Based Compensation

Forward Looking Statements

This Company Press Release contains certain "forward-looking" statements and information relating to the Company that are based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including, without limitations, competitive factors, general economic conditions, customer relations, relationships with vendors and strategic partners, the interest rate environment, governmental regulation and supervision, seasonality, technological change, changes in industry practices, and one-time events. Should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.

Contact Information

  • Enterprise Oilfield Group, Inc.
    Leonard D. Jaroszuk
    President & CEO
    (780) 418-4400 or Toll Free: 1-888-303-3361
    (780) 418-1941 (FAX)
    Enterprise Oilfield Group, Inc.
    Desmond O'Kell
    Vice President, Corp. Development
    (780) 418-4400 or Toll Free: 1-888-303-3361
    (780) 418-1941 (FAX)
    Email: contact@EnterpriseOil.ca
    Website: www.EnterpriseOil.ca