Annual revenue for our International operations was down 4% compared to the same period in 2011. The job count decreased by 18% due largely to lower activity in Russia. Many of our Russian customers did not complete their 2012 work programs, which led to lower than expected activity levels in Russia. Revenue per job increased by 16% as increased horizontal work in Russia led to larger fracturing job sizes. In addition, increased fracturing revenue as a percentage of total revenue contributed to the higher revenue per job.
Materials and operating expenses as a percentage of revenue decreased slightly to 86.5% from 86.9% compared to the same period in 2011. Improved pricing was offset by cost inflation. General and administrative expenses decreased slightly by $0.5 million largely due to lower share based expenses.
CORPORATE---------------------------------------------------------------------------- Year-Year ended December 31, Over-($ thousands, except revenue % of % of Year per job, unaudited) 2012 Revenue 2011 Revenue Change----------------------------------------------------------------------------ExpensesMaterials and operating 23,814 1.1% 21,988 1.0% 8%General and administrative 41,799 1.9% 41,692 1.8% 0% --------- ---------Total expenses 65,613 3.0% 63,680 2.8% 3%Operating loss(i) (65,613) (63,680) 3%--------------------------------------------------------------------------------------------------------------------------------------------------------(i) See first page of this report
Corporate expenses increased $1.9 million compared to last year due primarily to an increase in salaries and benefits for corporate employees and transactions costs relating to the i-TEC acquisition. These increases were partially offset by a decrease in share based expenses and profit sharing costs.
OTHER EXPENSES AND INCOME
2012 finance costs increased by $10.5 million relative to 2011 due to increased debt levels. Depreciation and amortization increased by $26.3 million as a result of the North American focused capital asset additions.
Foreign exchange losses of $0.4 million have been recognized in 2012 compared to gains of $4.3 million in 2011. The 2012 loss is due to the net impact of fluctuations in the U.S. dollar and Russian ruble relative to the Canadian dollar. Other income decreased by $4.1 million from the same period in 2011 due largely to proceeds from an insurance claim recognized in 2011.
INCOME TAXES
The income tax expense for the year ended December 31, 2012 was $4.8 million compared to $139.5 million in 2011. The decrease in the tax provision is largely attributable to significantly lower earnings. The effective tax rate in 2012 was 8.3% compared to an effective tax rate of 29.1% in 2011. The decrease is due primarily to tax losses in the U.S., which are partially offsetting taxable income in Canada.
LIQUIDITY AND CAPITAL RESOURCES
Operating Activities
Funds used in operations was $14.0 million in the fourth quarter of 2012 compared to funds provided by operations of $181.9 million in the fourth quarter of 2011 largely as a result of decreased operating income.
