Calmena Announces Fourth Quarter and Year End 2012 Results


CALGARY, ALBERTA--(Marketwire - March 27, 2013) -


Calmena Energy Services Inc. (CEZ.TO) ("Calmena" or the "Company") announces its financial results for the year ended December 31, 2012. All figures are reported in Canadian dollars unless otherwise stated. Our audited consolidated financial statements and related management's discussion and analysis for the period will be filed separately on SEDAR (, which should be reviewed in conjunction with this press release.


The tables below provide a summary of Calmena's financial and operating results as at and for the three and twelve month periods ended December 31, 2012 and 2011.

  Three months ended   Twelve months ended  
  December 31   December 31   December 31   December 31  
($ thousands, except per share amounts) 2012   2011   2012   2011  
Revenue 40,901   39,408   163,924   124,704  
EBITDAS* 467   6,097   14,664   13,967  
Net loss for the period (5,837 ) (1,974 ) (11,128 ) (8,959 )
Funds flow from (used in) continuing operations* (1,575 ) 5,493   8,942   10,718  
Net loss per share - Basic and diluted (0.02 ) (0.01 ) (0.04 ) (0.03 )
Funds flow from (used in) continuing operations per share- Basic and diluted* (0.01 ) 0.02   0.03   0.04  

* see non-GAAP measures section of this release for a description of this term.

  As at December 31,
($ thousands) 2012 2011
Total assets 230,328 221,891
Borrowings and debt, net of cash 59,289 45,745
Shareholders' equity 129,763 142,647


  • For the year ended December 31, 2012, the Company recorded:
    • Revenue of $163.9 million compared to $124.7 million in the comparable period in 2011, led by year over year growth in the US and Latin America offset in part by lower revenue in Canada; and
    • EBITDAS of $14.7 million was $0.7 million higher than the comparable period in 2011. Improvements in the US and Mexico were offset primarily by losses in Brazil relating to the four single rigs contracts which we terminated in December 2012, losses in MENA resulting from the shutdown of the operations for the majority of 2012 primarily due to the civil unrest and decreased revenue in Canada. 
  • Achieved record financial results in the US with a 54% increase in revenue and a 20% increase in EBITDAS over 2011 while deploying fifteen new internally developed and manufactured measurement while drilling ("MWD") kits;
  • Achieved record financial results in Mexico in 2012 with a 50% increase in revenue and a 113% increase in EBITDAS over 2011; 
  • Successfully completed a four well drilling program for Ecopetrol in Colombia;
  • During the third quarter, additional financing was obtained through a US$10.0 million three year term loan.


In January 2013, Calmena's Board of Directors initiated a process to identify, examine and consider a range of strategic alternatives available to the Company with a view to enhancing shareholder value. Calmena has engaged Peters & Co. Limited as its financial advisor in connection with the process. This process is ongoing and there will be further communication if the Board of Directors has approved a specific transaction or otherwise determines that disclosure is necessary.


In Canada, we expect to see strong utilization on our contract drilling equipment during 2013. Our double rig is committed to mid-2013 and we expect it will be utilized throughout 2013. We have retro-fitted two of our single drilling rigs to be more suitable in areas with year round activity. As a result we have seen good utilization of our singles in the first quarter of 2013 and one of our singles is already contracted for 200 days for 2013. Equipment rentals and frac fluids activity will be somewhat lower in 2013 compared to 2012 as we expect a reduction in the number of fracs due to changes in customer well plans in our operating areas. In wireline technologies, we have established ourselves as a leading provider of high pressure, horizontal completions, and expect to see significant growth in 2013.

While horizontal drilling activity in the United States has remained strong in the first quarter of 2013, we are seeing a seasonal slowdown in our utilization rates. We expect utilization to recover by the beginning of the second quarter leading to a strong full year average for 2013. After more than doubling capacity in 2012, we will focus primarily on maximizing utilization on our existing fleet and improving margins during 2013. 

At present, all five of our drilling rigs in Mexico are operating under contract to two major international oilfield services companies, and directional services is operating under contract on three rigs for one customer in Mexico. Demand for our rigs is high and appears set to increase as Pemex formalizes new production sharing agreements for development of land based fields. We expect strong utilization of our services and firm pricing will continue through 2013.

We successfully completed a four well drilling program in February 2013 for Ecopetrol in Colombia, and are now marketing our rig in Colombia and Mexico. The increase in drilling activity in Mexico will present near term opportunities for this drilling rig which is identical to two others in Mexico and well known to our customers there. We continue to develop our directional services business in Colombia and are currently contracted to a customer for up to seven wells while concurrently pursuing several other prospects.

In Brazil, operations are continuing with our heli-portable drilling rig under our four year contract. Our four singles rigs remain idle and are racked in one of our yards in Brazil. We are currently reducing all non-essential costs and are marketing the four single rigs, which Calmena believes are among the fastest and most efficient of their size, in Brazil and elsewhere in Latin America. 

In MENA, the Libyan government has set production targets and announced spending of up to $30 billion to increase production capacity and explore new fields over the next ten years. The current drilling rig count, which was 54 prior to the civil unrest, is now less than 20 and the Waha field, where we are currently operating is an important contributor to Libya's production. Although we are currently affected by labour issues we expect that these will be resolved and become less frequent in the near term. This will allow us to achieve strong and consistent utilization in the foreseeable future.


Calmena is a diversified energy services company that provides well construction services to its customers operating in Canada, the United States, Latin America and the Middle East and North Africa. The common shares of Calmena trade on the Toronto Stock Exchange under the symbol "CEZ".


This press release contains certain forward-looking statements relating to Calmena's plans, strategies, objectives, expectations and intentions. Expressions such as "may", "anticipate", "expect", "project", "believe", "hope", "estimate", "intend", "will", "continue", "foresee", and "forecast" and similar expressions and statements are intended to identify forward looking statements. Such statements represent Calmena's internal projections, estimates or beliefs concerning, among other things, an outlook for Calmena's operations in 2013, and other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These statements are only predictions and actual events or results may differ materially. Although Calmena believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Calmena's actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Calmena.

In particular, forward-looking statements included in this press release include, but are not limited to, statements with respect to anticipated utilization of our contract drilling equipment in Canada during 2013, including utilization of Calmena's double drilling rig; expectations regarding growth in wireline technologies in 2013; expectations regarding demand for equipment rentals and frac fluids for the remainder of 2013; expectations as to utilization of horizontal drilling rigs in the United States for the remainder of 2013; Calmena's plans to focus on maximizing utilization on the its existing fleet and improving margins in the United States in 2013; expectations for operations in Mexico in 2013, including utilization and pricing; anticipated effect of Pemex formalizing new production sharing agreements for development of land based fields on demand for Calmena's drilling rigs; anticipated effect of increased drilling activity in Mexico on near term opportunities for drilling rigs in Mexico; the Company's plans to market its single rigs and reduce all non-essential costs in Brazil; outlook for drilling activity in MENA; the Company's expectations regarding resolution of labour issues in Libya and the potential for future labour issues; the anticipated effect of resolving labour issues in Libya on utilization; the outlook for Calmena's operations, including the Company's strategy for the remainder of 2013, including the statements under the heading "Outlook" in this press release.

These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Calmena's control, including, but not limited to, the impact of general economic conditions; industry conditions and changes in industry conditions; volatility of commodity prices; decreased demand for energy services; competition from other energy services providers; the lack of availability of qualified personnel or management; ability of Calmena to re-finance or extend the maturity date of its senior debt and generate positive cash flow; failure of counter parties to perform on contracts; failure to successfully negotiate new contracts or renew existing contracts; failure to successfully deploy rigs; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; risks associated with international operations, including, but not limited to, effect of civil unrest on the Company's operations in Libya; seasonality; loss of key customers; fluctuations in foreign exchange or interest rates and stock market volatility; supply and demand for oilfield services relating to the drilling, completion and maintenance of oil and gas wells as well as services related to, oilfield equipment rentals and production and ancillary services; liabilities and risks, including environmental liabilities and risks inherent in oil and natural gas operations; uncertainties in weather and temperature affecting the duration of the service periods and the activities that can be completed; ability to access sufficient capital from internal and external sources; failure to successfully negotiate contracts for drilling rig operations; and the other risks considered under "Risk Factors" in our annual information form for the year ended December 31, 2012 which is available on

With respect to forward-looking statements contained in this press release, Calmena has made assumptions regarding, but not limited to: the implementation of the Company's international growth strategy; current commodity prices and royalty regimes; availability of skilled labour; timing and amount of capital expenditures; ability of Calmena to re-finance or extend the maturity date of its senior debt; ability of Calmena to renew existing contracts and enter into new contracts; rig utilization and pricing; future exchange rates; the impact of increasing competition; conditions in general economic and financial markets; industry conditions; supply and demand for oilfield services relating to the drilling, completion and maintenance of oil and gas wells as well as services related to oilfield equipment rentals and production and ancillary services; effects of regulation by governmental agencies; trends in Calmena's operations; and future operating costs.
Management has included the above summary of assumptions and risks related to forward-looking statements provided in this press release in order to provide shareholders with a more complete perspective on Calmena's current and future operations and such information may not be appropriate for other purposes. Calmena's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Calmena will derive therefrom. Readers are cautioned that the foregoing lists of factors are not exhaustive.

These forward-looking statements are made as of the date of this press release and Calmena disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.


The following measure is used within this release, but not recognized under GAAP. As a result, the method of calculation may not be comparable with other companies. This measure should not be considered alternatives to net loss and net loss per share as calculated in accordance with GAAP:

EBITDAS (Earnings before interest, income taxes, depreciation and amortization, other items of income and expense and share based compensation) - Management believes that EBITDAS as derived from information reported in the Consolidated Statement of Operations is a useful supplemental measure as it provides an indication of the Company's ability to generate funds by the Company's core business activities prior to consideration of how those activities are financed, the impact of foreign exchange, how the results are taxed, how funds are invested or how non-cash depreciation and amortization charges affect results. See the reconciliation of EBITDAS to net loss in the Company's management's discussion and analysis for the year ended December 31, 2012.

Funds flow from continuing operations: Management believes that in addition to cash generated from operations, funds flow from continuing operations is a useful supplemental measure because it provides an indication of the funds generated by the Corporation's principal business activities prior to the consideration of working capital, which is primarily made up of highly liquid balances. See the reconciliation of funds flow from continuing operations in the Company's management's discussion and analysis for the year ended December 31, 2012.

Calmena Energy Services Inc.
John King
President and Chief Executive Officer
(403) 366-2066
(403) 225-3879

Calmena Energy Services Inc.
Peter Balkwill
Vice President, Finance & CFO
(403) 366-2066
(403) 225-3879

Calmena Energy Services Inc.
700, 333 - 7th Avenue SW
Calgary, Alberta T2P 2Z1

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