Coil Service Segment - XSR
The US XSR division began to hit its stride during the latter half of the first quarter. March was a record month both on revenue and operating margin. The current work backlog has given management the confidence to begin the process of deploying the third unit to the Eagle Ford. It is anticipated that the unit will be operating by mid-June.
For the first quarter, operating days were 86 which was up from 84 in the previous period. During the quarter the XSR division completed 39 jobs and since inception has performed 164 jobs. Over the course of these wells Xtreme has never left any coiled tubing in the well. This is an unprecedented operational record. In addition, the Company has now completed wells to 20,344 feet of total measured depth and 10,240 feet of total lateral length with 2 5/8 inch coiled tubing.
In Saudi Arabia the strong performance continued in the first quarter. Operating margins improved on very strong utilization of 99%. The Company is still waiting to hear the final results on the extension of the two units in Saudi. They will complete the existing contract in July and August respectively. The new contract has been bid and it is expected that an announcement is imminent.
This news release, or documents incorporated herein, contains forward-looking statements ("FLS"). More particularly, this news release contains statements that may relate to contracting, marketing, financing, construction, modifications, deployment, operation, utilization of drilling rigs in the Company's current and future fleet, and any potential outcome relating to claims and litigation. Further, the FLS herein may relate to trade credit insurance carried by the Company to mitigate receivables collection risk. Although Xtreme believes expectations reflected in these FLS are reasonable, readers should not place undue reliance on them because Xtreme can give no assurance they will prove to be correct. There are many factors that could cause FLS not to be correct, including risks and uncertainties inherent in the Company's business.
These statements are based on certain factors and assumptions including, but not limited to: the assessment of current and projected future operations; ongoing and future strategic business alliances, negotiations and opportunities to enter new, extend or complete existing contracts; the availability and cost of financing; foreign currency exchange rates; timing and magnitude of capital expenditures; expenses and other variables affecting rig operation, modification and construction; the ability and commitment of vendors to provide rig component equipment, services and supplies, including labor, in a cost-effective and timely manner; the issuance of applied-for patents; changes in tax rates; and government regulations. Although Xtreme considers the assumptions used to prepare this news release reasonable, based on information available to management as of May 7, 2013, ultimately the assumptions may prove to be incorrect.
Forward-looking statements are also subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially from management's current expectations. These factors include, but are not limited to: the cyclical nature of drilling market demand, foreign currency exchange rates, and commodity prices; access to credit and to equity markets; the availability of qualified personnel; vendor-provided rig components; and, competition for customers.
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