"Cabo Drilling generated revenues of $23.00 million during the first six months of fiscal 2012," stated Mr. Versfelt, Cabo's President & CEO. "This represents a 26% decrease over the $31.29 million recorded in the comparable period in fiscal 2012."
"Gross margin adjusted to include depreciation was 19.1% or $1.75 million in the second quarter of fiscal 2013, as compared to 19.8% in the second quarter of fiscal 2012," stated Mr. Versfelt. "In accordance with IFRS, depreciation expenses of $649,821 are included in direct costs as compared to $663,782 in the second quarter of fiscal 2012. Adjusted gross margin when depreciation expense is excluded from direct costs is 25.8% in the second quarter of fiscal 2013, as compared to 24.1% in the second quarter of fiscal 2012."
"The Company reported $2.45 million in EBITDA (10.7%) for the first six months of fiscal 2013, compared to $4.53 million in the first six months of fiscal 2012 (12.2% after adjustment for one time gain), said Mr. Versfelt. "The $4.53 million in fiscal 2012 included a one time gain on the settlement of a debenture of $710,889."
"Working capital increased to $13.57 million during the six months ending December 31, 2012, from $12.72 million at June 30, 2012," stated Mr. Versfelt. "Total liabilities decreased by $3.63 million during the six months to $14.96 million at December 31, 2012. Additionally, subsequent to the quarter ended December 31, 2012, the Company paid, in full, the debentures totalling $1.997 million that were due and payable on February 14, 2013.
"Approximately 49% of revenues came from gold related projects, 17% from copper, 26% from iron and the remaining 8% from other base metals. Overall, Cabo Drilling management expects average drill utilization in fiscal 2013 to remain near the 40-45% level, with gross margins at 25-26%, prior to depreciation expenses included in direct costs." stated Mr. Versfelt. "General and administration expenses should remain in the $7 million range. Cabo Drilling is budgeting annual gross revenues of approximately $46-48 million for fiscal 2013."
Second quarter ended December 31, 2012
Revenue for the quarter ending December 31, 2012, decreased $5.20 million or 36% to $9.16 million, compared to $14.36 million in the second quarter of fiscal 2012, and decreased 34% from the $13.84 million in the first quarter of fiscal 2013. The primary reason for the decrease is due to reduced demand for drilling in the last two months of calendar 2012. Latin America division revenues decreased by 11% with lower drill utilization in Colombia as compared to the second quarter of fiscal 2012, decreasing revenues to $3.76 million, as compared to $4.23 million in the comparable period in fiscal 2012. The Canadian and USA divisions recorded a significant decrease in revenues of 49% to $5.05 million in the second quarter of fiscal 2013, as compared to $9.92 million in the second quarter of fiscal 2012. Management expects the second half of fiscal 2013 to be lower than the second half of fiscal 2012, but higher than the first half of fiscal 2013.
Surface drilling revenues decreased 34%, from $10.29 million in the second quarter of fiscal 2012 to $6.82 million during the second quarter of fiscal 2013, largely due to the early completion of drilling projects with major mining clients in Canada. Several of these projects may restart after 2013 budgets are approved and the new drilling season begins. Revenues from reverse circulation programs decreased by 88% to $235,400 in the three months ending December 31, 2012, as compared to $1.92 million in the comparable period in fiscal 2012 for similar reasons. Underground drilling increased by 3% in the second quarter of fiscal 2013 to $1.81 million, as compared to $1.75 million in the second quarter of fiscal 2012, as a result of increased underground drill utilization.
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