TORONTO, ONTARIO--(Marketwire - Nov. 30, 2012) -
NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES
Estrella International Energy Services Ltd. ("Estrella" or the "Company") (TSX VENTURE:EEN) announces that it has filed its Interim Condensed Consolidated Financial Statements and the related Management's Discussion and Analysis ("MD&A") for the three and nine month period ended September 30, 2012. Copies of these documents can be found on the SEDAR website at www.sedar.com. In this press release, except for share amounts, all dollar amounts are in US$'000 unless otherwise specified.
During the quarter ended September 30, 2012, the Company made some progress in consolidating its position in Colombia. The Company is still working through the impacts of the region wide strike in the Barrancabermeja area of Colombia, which lasted the month of January (please the press release dated January 16, 2012 for more information). After the strike ended, Estrella was left with six rigs idle that had been continuously working prior to the strike and received a further three rigs from Petroland of which two were also idle after the strike. The Company is currently marketing the rigs to obtain new contracts.
The Company is looking to expand the financial contribution of its directional drilling and consulting services, and made progress this quarter with new consulting projects in Argentina, Chile and Colombia and the initiation of activities with the Scientific Drilling joint venture. Additionally, the Company continues to work on reducing the corporate SG&A and has made positive strides during the quarter to this area. Management's goal is to have over 80% of its rig fleet on term contracts and to have disposed of underperforming assets to ensure that the Company is well positioned for future growth.
While utilization of the rig fleet was substantially lower than our target, the Company has been awarded three 3+2 year contracts for rigs that had been idle and also awarded two 3 year extensions to existing contracts during the quarter. Also, large increases in consulting business and the growth in the directional business are expected to continue through the remainder of the year and are expected to have positive impact in the operating performance of the Company.
Selected Financial Information for the Quarter Ended September 30, 2012
During the quarter the Company recorded revenues of $16,145 ($15,230 in 2011), this notwithstanding that the Company's rig utilization rate was 40% (69% in 2011), which is much lower than historical averages. The revenues were offset by general and administrative expenses of $2,690 ($4,095 in 2011), depreciation of $2,650 ($2,508 in 2011), interest expense of $3,286 ($2058 in 2011) and oilfield expenses of $15,201 ($12,313 in 2011). For the quarter ended September 30, 2012, the Company recorded a net loss of $8,096 (loss of $8,114 in 2011) and EBITDA of -$1,746 (-$1,999 in 2011). For the quarter ended September 30, 2012, the Company recorded a net loss per share of -$0.0356 (-$0.0621 in 2011).
Estrella is an oil and natural gas, geothermal and mining service company with operations throughout Latin and South America. It provides conventional drilling services; directional drilling services; tools and equipment sales and rentals; work-over and finishing services; and consulting and engineering services. The Corporation is headquartered in Buenos Aires, Argentina and has operating locations in six countries Latin and South America.
This press release may contain forward-looking statements which reflect management's expectations regarding future growth, results of operations, performance and business prospects of Estrella. These forward-looking statements may relate to, among other things, forecasts or expectations regarding business outlook for Estrella; commodity prices for oil and natural gas; oil and natural gas demand and production growth; debt service requirements for Estrella; improvements in operating procedures and technology; capital expenditures by Estrella and the oil and gas industry; the business strategies of Estella's customers; future global economic conditions; and future results of operations; expectations regarding the Corporation's ability to raise capital; realization of the anticipated benefits of acquisitions and dispositions, revenue growth, future acquisitions, generation of cash flow, and may also include other statements that are predictive in nature, or that depend upon or refer to future events or conditions, and can generally be identified by words such as "may", "will", "expects", "anticipates", "intends", "plans", "believes", "estimates", "guidance" or similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These statements are not historical facts or guarantees of future performance, but instead represent management's current expectations, estimates and projections regarding future events.
The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances, such as future availability of capital on favourable terms, may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Estrella. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release, and Estrella does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities law.
THIS PRESS RELEASE, REQUIRED BY APPLICABLE CANADIAN LAWS, IS NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO SELL ANY OF THE SECURITIES DESCRIBED HEREIN IN THE UNITED STATES. THESE SECURITIES HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS UNLESS REGISTERED OR EXEMPT THEREFROM.
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