St. Albert, Alberta--(Newsfile Corp. - November 8, 2019) - Enterprise Group, Inc. (TSX: E) (the "Company" or "Enterprise"), a consolidator of services to the energy sector; focused primarily on specialized equipment rental; today released its Q3 2019 results.
|Three months September 30, 2019||Three months September 30, 2018(2)||Nine months September 30, |
|Nine months |
September 30, 2018(2)
|Gross margin %||9%||12%||25%||9%|
|Net loss and comprehensive loss||$(2,297,554)||$(1,100,220)||$(3,838,631)||$(1,244,714)|
(1) Identified and defined under "Non-IFRS Measures".
(2) In March 2018, the Company closed a transaction to divest substantially all the assets of CTHA. The net operations of CTHA, including the prior period, are presented as a single amount in the consolidated statements of loss and comprehensive loss.
An unseasonably wet spring and summer continued into Q3 and further delayed the start of many projects. Activity in certain regions of Alberta came to a complete halt due to wet conditions, which is uncommon for Q3. Activity in Northeastern B.C. continued to increase and positively impacted operations. Regional diversity helped the Company during the quarter, however the increased activity in Northeastern B.C. was not enough to offset the decline in Alberta. Customer activity has been, and will continue to be, a significant impact on company performance.
Despite the wet weather continuing into the third quarter, for the nine months ended September 30, 2019, the Company generated positive cash flow from operations of $3,914,674 compared to $2,524,377 in the prior period. Over the same period the Company purchased and cancelled 2,674,000 shares at a cost of $459,068. As result, the Company's share capital account was reduced by $3,840,505, representing the average share value of outstanding shares. Enterprise believes its stock remains undervalued and will continue to re-invest positive cash flow to buy-back shares to enhance shareholder value.
Revenue for the three months ended September 30, 2019, was $3,830,847 compared to $4,846,989 a decrease of $1,016,142 compared to the prior period. Revenue for the nine months ended September 30, 2019, of $14,172,541 decreased by $725,304 compared to the prior period.
Gross margin for the three months ended September 30, 2019, was $352,043 or 9%, a decrease of $231,992 compared to the prior period of $584,035 or 12%. EBITDA was $(183,188) for the three months ended September 30, 2019, a decrease of $216,352 compared to the prior period. For the nine months ended September 30, 2019, gross margin was $3,488,313 or 25%, an increase of $2,088,614 compared to the prior period of $1,399,699 or 9%. EBITDA was $1,847,235 for the nine months ended September 30, 2019, an increase of $1,908,228 compared to the prior period. Enterprise is realizing the benefits of its efforts to improve gross margin and EBITDA, which includes reducing third party rentals, reducing the use of external contactors and effectively managing resources and staffing levels.
About Enterprise Group, Inc.
Enterprise Group, Inc. is a consolidator of services to the energy sector. The Company's focus is primarily on specialized equipment rental. The Company's strategy is to acquire complementary service companies in Western Canada, consolidating capital, management, and human resources to support continued growth. More information is available at the Company's website www.enterprisegrp.ca. Corporate filings can be found on www.sedar.com.
For questions or additional information, please contact:
Leonard Jaroszuk, President & CEO, or
Desmond O'Kell, Senior Vice-President
Forward Looking Information
Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company's future performance. The use of any of the words "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.
The Company uses International Financial Reporting Standards ("IFRS"). EBITDA is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-IFRS measure. This news release contains references to EBITDA. This non-IFRS measure used by the Company may not be comparable to a similar measure used by other companies. Management believes that in addition to net income, EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDA is calculated as net income excluding depreciation, amortization, interest, taxes and stock based compensation.
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