FORT ST. JOHN, BRITISH COLUMBIA -- (Marketwire) -- 03/05/13 -- Macro Enterprises Inc. (TSX VENTURE: MCR) -
Summary of financial results (thousands of dollars except per share amounts) -------------------------------------- Three months ended Year ended December 31 December 31 -------------------------------------- 2012 2011 2012 2011 -------------------------------------- (unaudited)Revenues $ 43,827 $ 33,021 $148,314 $129,212EBITDA(1) 7,576 4,277 30,626 13.304Net earnings 5,643 2,113 19,345 6,027Net earnings per share $0.23 $0.08 $0.79 $0.23 --------------------------------------Weighted average common shares outstanding (thousands) 23,882 23,931 ------------------Highlights-- Revenues increased substantially from same period last year due to additional work obtained and from the November 2012 acquisition of pipeline construction assets.-- EBITDA(1) of $7.6 million was generated in the quarter due to the higher levels of activity and improved margins.Note 1 - References to EBITDA are to net income from continuing operationsbefore interest, taxes, amortization and impairment charge. EBITDA is notan earnings measure recognized by International Financial ReportingStandards ("IFRS") and does not have a standardized meaning prescribed byIFRS. Management believes that EBITDA is an appropriate measure inevaluating the Company's performance. Readers are cautioned that EBITDAshould not be construed as an alternative to net income (as determinedunder IFRA) as an indicator of financial performance or to cash flow fromoperating activities (as determined under IFRS) as a measure of liquidityand cash flow. The Company's method of calculating EBITDA may differ fromthe methods used by other issuers and, accordingly, the Company's EBITDAmay not be comparable to similar measures used by other issuers.
Fourth quarter results
Consolidated revenue was $43.8 million compared to $33.0 million in the fourth quarter last year. During the fourth quarter this year, the Company was active in pipeline integrity work for several customers. In addition, the Company obtained some pipeline and facility construction work for two customers. Lastly, additional revenue was obtained under the master services agreement obtained in November 2012 with the acquisition of the assets and business from North American Pipeline (the "NAP acquisition"). Last year, the Company worked on a compressor move and re-installation for one customer and began a second similar project for the same customer. The Company also worked on a pipeline project for a new customer. In addition, work continued on a large piping and related facilities contract for another customer in NE B.C. The Company also completed some smaller projects for other customers
Operating expenses were 77.3% of revenue in the quarter compared to 82.8% in the same quarter last year. The quarterly performance is in line the Company's year-to-date performance. Expenses were lower, as a percent of revenue, due to improved bidding and a greater proportion of hourly-based work.
General and administrative expenses were $2.3 million, up from $1.3 million last year. Included in costs this year is $0.5 million related to one-time acquisition costs on the NAP acquisition. In addition, expenses were up due to the greater level of activity.
Amortization of property, plant and equipment was $1.4 million compared to $1.3 million in the prior period reflecting a higher level of fixed assets in the period, partly from the NAP acquisition. In addition, the Company recorded $1.7 million of amortization of the value attributed to a customer contract. This charge completely amortized this asset as the benefit of this asset was obtained during the period from the acquisition date to the year end.
Net finance costs of $0.3 million were approximately the same as last year.
The Company recorded a one-time non-cash gain of $2.2 million related to the NAP acquisition. This gain arose because the value of the assets obtained in this acquisition exceeded the purchase price.
Income tax expense in the quarter of $0.8 million was at an effective tax rate of 12.2%. This is below the expected rate of 25.0% due mainly to the inclusion of the gain from business combination which is not subject to tax. On a year-to-date basis, the effective tax rate is 23.9%, in line with statutory rates after adjusting for the gain from business combination.
Net earnings were $5.6 million ($0.23 per share) compared to $2.1 million ($0.08 per share).
The Company expects its revenues for the first quarter of 2013 will be higher than the revenues recorded in the first quarter last year. The increase will be attributable to revenues generated from the pipeline construction and maintenance business acquired from North American Pipeline Inc. in November 2012. The Company will continue to actively bid new jobs. The continued low price of natural gas could affect future levels of activity in the areas where the Company is active.
Macro's core business is providing pipeline and facilities construction and maintenance services to major companies in the oil and gas industry in northeastern B.C. and northwestern Alberta. The Company's corporate office is in Calgary, Alberta. Its shares are listed on the TSX Venture Exchange under the symbol MCR. Information on the Company's principal operating unit, Macro Industries Inc., can be found at www.macroindustries.ca.
Certain statements in this news release may include forward-looking information that involves various risks and uncertainties. These may include, without limitation, statements regarding expected revenues, expenses and industry trends and the pursuit of strategic acquisitions. These risks and uncertainties include, but are not restricted to, global economic conditions, government regulation of energy and resource companies, seasonal weather patterns, maintaining and increasing market share, terrorist activity, the price and availability of alternative fuels, the availability of pipeline capacity, and potential instability or armed conflict in oil producing regions. These risks and uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such forward-looking statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These statements are based on the estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, the Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Macro Enterprises Inc.
President and C.E.O.
Macro Enterprises Inc.
T. Jerrold Jackson