News Column

Enterprise Group Announces Results for the Second Quarter of 2014

August 29, 2014



By a News Reporter-Staff News Editor at Energy Weekly News -- seasonal improvement, our expanded capacity, and our upcoming acquisition - give us great optimism for Enterprise's future, both in the months ahead and over the long-term."

Utilities/Infrastructure Division Utilities/Infrastructure Construction: Three months

June 30, 2014 Three months

June 30, 2013 Six months

June 30, 2014 Six months

June 30, 2013 Revenue $8,311,555$4,308,597$16,788,960$8,157,806 Increase $4,002,958$8,631,154 EBITDAS $2,403,741$1,335,550$4,771,499$2,426,841 Increase $1,068,191$2,344,658 Total Assets $46,624,155$27,626,731$46,624,155$27,626,731 Increase $18,997,424$18,997,424

Enterprise's Utilities/Infrastructure Division generated second quarter revenue of $8.3 million, an increase of $4.0 million when compared to the prior year. This improvement can be attributed to the acquisition of Calgary Tunnelling & Horizontal Augering Ltd. ("CTHA") in June of 2013, an increase in activity, and the expansion of Enterprise's service equipment fleet, which has allowed the Company to both increase its capacity and attract projects from major customers. This division's EBITDAS margin of 29% reflects both a change in revenue mix due to the acquisition of CTHA and an increased use of third-party equipment necessitated by strong demand at T.C. Backhoe. This metric is expected to improve as recently purchased capital assets replace subcontracted equipment currently in use. Enterprise's capital plan allocates the funds necessary to increase its hydrovac fleet to 20 units. The Company currently has 16 units in operation.

Equipment Rental Division

Equipment Rental: Three months

June 30, 2014 Three months

June 30, 2013 Six months

June 30, 2014 Six months

June 30, 2013 Revenue $5,758,062$522,438$18,387,962$5,577,609 Increase $5,235,624$12,810,353 EBITDAS $1,349,265$(203,833 )$7,224,667$3,320,662 Increase $1,553,098$3,904,005 Total Assets $56,540,496$15,832,136$56,540,496$15,832,136 Increase $40,708,360$40,708,360

Enterprise's Equipment Rental Division generated second quarter revenue of $5.8 million, an increase of $5.2 million when compared to the prior year. This improvement was primarily due to the acquisition of Hart at the beginning of the first quarter. This division's EBITDAS margin of 22% reflects a change in revenue mix due to the acquisition of Hart, and is expected to improve as recently purchased capital assets replace subcontracted equipment currently in use.

Major Developments

On July 31, 2014, Enterprise announced that it had signed a letter of intent to acquire a privately-owned oilfield site services rental company. The purchase price for this acquisition will be based upon the Acquisition Target's most recent financial statements, which are currently being audited, as well as the conclusion of a complete appraisal of the Acquisition Target's assets. The acquisition will be funded by a combination of Enterprise shares, cash, and vendor take-back financing.

Over the past ten years, the Acquisition Target has developed a highly-regarded full-service oilfield site infrastructure company that fulfills multiple equipment rental needs for a variety of oil and gas customers. The Acquisition Target's equipment fleet currently consists of approximately 350 owned pieces. This acquisition expedites Enterprise's plans to be operating three of its subsidiaries in Fort St. John by the fourth quarter of 2014. The owner of the Acquisition Target has agreed to sign a five-year management agreement with the Company.

Enterprise anticipates completing this acquisition by October of 2014. This completion will be subject to negotiation of a definitive share purchase agreement, the Company's finalization of satisfactory due diligence, and customary closing conditions.

Keywords for this news article include: Energy, Oilfield, Oil & Gas, Utilities.

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Source: Energy Weekly News


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