Lonestar West Inc.

Lonestar West Inc.

June 01, 2015 14:26 ET

Lonestar West Announces Q1 2015 Financial Results

SYLVAN LAKE, ALBERTA--(Marketwired - June 1, 2015) - Lonestar West Inc. (TSX VENTURE:LSI) today announced the financial results for the three months period ended March 31, 2015.

Highlights for the three months ended March 31, 2015 include:

  • Revenues increased 15.6% to $13,312,981 from $11,518,959 in the previous year equivalent period.
  • Gross margin1 increased to 25.8% from 25.3% in the previous year equivalent period.
  • EBITDAC2 increased 5.5% to $2,242,707 from $2,124,961 in the previous year equivalent period.
  • EBITDAC3 per basic share decreased 20% to $0.08 from $0.10 in the previous year equivalent period.
  • Income before taxes was $378,227, a decrease of $734,712 in comparison to $1,112,939 in the previous year equivalent period.
  • Net income for the period was $210,965 a $623,739 decrease in comparison to $834,704 in the previous year equivalent period.

The Company has been successful in executing its planned growth strategy over the last 24 months with three transformational acquisitions and organic expansion throughout the Southern United States, which has positioned Lonestar as a major Hydrovac and Vacuum services provider in North America. This growth has resulted in the Company achieving record revenues for the first quarter of fiscal 2015. In addition, the acquisition of Firehawk Services Inc. in February 2015 marks the discontinuance of the lease operator program for the Company. This demonstrates the maturation of the Company into a full corporate model.

The Company added 14 new units in the first quarter of Fiscal 2015 bringing the total fleet to 152 units as of March 31, 2015. The Company anticipates that fewer units will be added to the fleet in future quarters.

The Company achieved EBITDAC2 of $2,242,707 for the quarter ended March 31, 2015, which is a slight improvement from $2,124,961 for the prior year equivalent period. The EBITDAC margin was 16.8% for the quarter ended March 31, 2015 a decrease of 1.6% when compared to the quarter ended March 31, 2014. While the Company is pleased with the EBITDAC result, the decrease in EBITDAC margin can be attributed to several factors:

  • The Company repositioned its fleet during the first quarter of fiscal 2015, moving 20 units from Western Canada and the United States to Eastern Canada. This redeployment resulted in decreased revenues due to lower operational days and increase costs relating to the movement of the fleet.
  • Lower than anticipated revenues were experienced as a result of the decline in the energy markets, which impacted both the Canadian and United States division.
  • Extreme weather experienced in the United States division impacted operational days and had a direct impact on the revenues for the quarter.

"The Company is pleased with the results for the first quarter of fiscal 2015 in the current economic landscape and the growth it has achieved with revenues for Q1 2015," commented James Horvath, President and CEO of Lonestar. "Although we have experienced growth in both revenue and EBITDAC, the first quarter was adversely impacted by weather, and the decreased energy market. Management is focused on improving revenue per truck by repositioning the fleet to areas less sensitive to the fluctuations in energy prices and to add to the fleet in a disciplined manner. "

Subsequent to March 31, 2015 the Company added 1 unit to its fleet for a total of 153 units as of the date of this press release.

About Lonestar West

Based in Sylvan Lake, Alberta, Lonestar West Inc. operates a fleet of 153 Hydrovac, Vacuum and Auxiliary units throughout Western Canada, Ontario, California, and the Southern United States. It is focused on profitably growing its HVAC services to become a major competitor in the North American market.

For more information please visit the Lonestar West website at www.lonestarwest.com


This News Release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward- looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "could", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "may", "will", "project", "should" or similar words, including negatives thereof, suggesting future outcomes. In particular, this News Release contains forward-looking statements relating to: demand for the Company's services and general industry activity level; the Company's growth opportunities; and expectations regarding the Company's revenue, normalized EBITDAC and equipment utilization. Lonestar believes the expectations reflected in such forward-looking statements are reasonable as of the date hereof but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon.

Various material factors and assumptions are typically applied in drawing conclusions. Specific material factors and assumptions include, but are not limited to:

  • Changes in industry conditions (including the levels of capital expenditures made by oil and gas producers and explorers)
  • Credit risk to which the Company is exposed in the conduct of its business
  • Fluctuations in prevailing commodity prices, currency and interest rates
  • The competitive environment to which the business is, or may be, exposed in all aspects of its business
  • The ability of the Company to access equipment and new technologies
  • The Company's ability to maintain relationships with key suppliers
  • The ability of the Company to attract and maintain key personnel and other qualified employees
  • Various environmental risks to which the Company is exposed in the conduct of its operations
  • Inherent risks associated with the conduct of the business in which the Company operates
  • Timing and costs associated with the acquisition of capital equipment
  • The impact of weather and other seasonal factors that affect business operations
  • Availability of financial resources or third-party financing, and;
  • The impact of new laws or changes in administrative practices on the part of regulatory authorities.

Readers are cautioned that these factors are difficult to predict. Accordingly readers are cautioned that the actual results achieved will vary from the information provided herein and the variations may be material. Readers are also cautioned that the list of factors above are not exhaustive. Before placing reliance on any forward-looking statements to make decisions with respect to an investment in securities in Lonestar, prospective investors and others should carefully consider the factors identified above and other risks, uncertainties and potential changes that may cause actual results or events to differ materially from those anticipated in such forward-looking statements.

Forward-looking statements are not a guarantee of future performance and involve a number of risks and uncertainties, some of which are described herein. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Lonestar's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the risks identified in Lonestar's annual information form and management discussion and analysis for the year ended December 31, 2014 (the "MD&A"), which are available for viewing on SEDAR at www.sedar.com. In addition, the forward-looking statements contained in this News Release are made as of the date of this News Release. Lonestar does not undertake any obligation to publicly update or to revise any forward-looking statements except as expressly required by applicable securities laws. The forward-looking statements contained in this Press Release are expressly qualified by the cautionary statements contained herein.


  1. Gross margin is calculated as gross profit as a percentage of revenues
  2. This News Release contains the term EBITDAC as presented and does not have any standardized meaning prescribed by international financial reporting standards ("IFRS") and therefore it may not be comparable with the calculation of similar measures for other entities. Management uses EBITDAC to analyze the operating performance of the business. EBITDAC as presented is not intended to represent cash provided by operating activities, net earnings or other measures of financial performance calculated in accordance with IFRS. It is defined as Earnings before interest, taxes, depreciation, amortization, and stock based compensation excluding foreign exchange gains or losses which are primarily related to the US dollar activities of the Company and can vary significantly depending on exchange rate fluctuations, which are beyond the control of the Company.
  3. EBITDAC per share is calculated as EBITDAC divided by the weighted average shares outstanding for the period.


Contact Information