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Energold Drilling Group Announces Fourth Quarter & Fiscal 2017 Financial Results

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Energold Drilling Group Announces Fourth Quarter & Fiscal 2017 Financial Results

Canada NewsWire

Trading Symbol: "EGD: TSX.V"

VANCOUVER, April 17, 2018 /CNW/ - Energold Drilling Corp. ("Energold" or "the Company") announces annual revenue in 2017 of $75.0 million across all business divisions, compared to 2016 revenue of $65.4 million, representing an increase of 14.6% on a year over year basis. Improving fundamentals including recovering commodity prices led to the improvement in revenue and activity in the Company's core mineral and oil & gas drilling markets. Mineral drilling revenue rose 22.2% in 2017 compared to 2016 while revenue in the oil and gas drilling business increased by 24.4% compared to 2016.

There were substantial improvements in certain regions during the year and market improvements in general strengthened considerably throughout 2017 that carried over into early 2018. The Company's geographic and market diversification efforts continue to pay off in the green and infrastructure drilling markets.

In 2017, the Company's overall gross margin was 14.4% compared to 14.1% in 2016. Continued overhead cost containment and increases in activity levels were partially offset with start-up costs and increased usage of working capital to begin new programs, namely in the mineral, green and infrastructure drilling markets. The net loss in 2017 was $17.6 million or ($0.32) per share compared to an adjusted net loss of $18.6 million or ($0.36) per share in 2016. At the end of 2017, Energold's balance sheet had $7.7 million in cash and $51.5 million in working capital.

2017 Annual Results Comparison ($CAD '000s except per-share amounts)



For three months ended December 31

For the year ended December 31


2017

2016

2017

2016

Revenue

$

$

$

$


Mineral

10,948

8,857

45,295

37,075


Energy

5,056

4,034

22,681

18,229


Manufacturing

2,279

1,448

7,004

10,096


18,283

14,339

74,979

65,400

Net (Loss) Income






Mineral

(704)

1,043

(2,402)

(2,273)


Energy

(2,406)

(865)

(6,517)

(7,457)


Manufacturing

(1,194)

(1,655)

(3,912)

(5,023)


Corporate

(1,614)

(2,434)

(4,767)

(3,808)


(5,918)

(3,911)

(17,598)

(18,561)

Loss Per Share






Basic and diluted

(0.11)

(0.07)

(0.32)

(0.36)






EBITDA*

(2,900)

(787)

(5,618)

(5,250)



As of December 31, 2017

As of December 31, 2016

Cash

7,653

13,715

Working Capital

51,536

46,859

*     

EBITDA - Earnings before interest, taxes, depreciation and amortization (see non-IFRS (international financial reporting standards)
financial measures in Energold's MD&A).

 

MINERAL DRILLING DIVISION

Revenues increased to $45.3 million in 2017 from $37.1 million in 2016 as a result of a 27% increase in meters drilled. Average revenue per meter in 2017 was $154 compared to $159 in 2016. Although the market is recovering, there was still some excess rig capacity in the industry in 2017 that impacted pricing. As capacity utilization rises, pricing and margins are expected to expand, coupled with continued focus on low operating costs and increased productivity. The margin for the year ended December 31, 2017 was $5.7 million or 13%, compared to $4.9 million or 13% in the comparable period in 2016.

Meters Drilled



Q4 2017

Q4 2016

2017 Annual

2016 Annual

Meters Drilled

66,300

59,400

294,100

232,600

Drill Rigs

139

139

139

139

 

ENERGY DRILLING DIVISION (Oil & Gas, Green Energy, Geotechnical, Water)

Revenues for the year ended December 31, 2017 were $22.7 million compared to $18.2 million in 2016. Although activity levels are still lower than what the Company has experienced in previous years, Q1-2017 was more active in the oil sands compared to Q1-2016. Gross margin improved to $4.6 million or 20% in 2017 compared to $3.3 million or 18% in 2016.

EBITDA for the energy division was positive for 2017. In 2017, Bertram drilled 33,400 meters in Canada and 104,800 in the U.S. compared to 18,000 meters in Canada and approximately 112,700 in the U.S. in 2016. Cros-Man, which does infrastructure drilling in Central Canada, drilled 43,500 meters in 2017 compared to 30,500 in 2016 (from March 4, 2016 acquisition). Subsequent to December 31, 2017, the Company was awarded more than $10 million in new green drilling contracts in the United States and $9 million in infrastructure drilling contracts in Canada.

Meters Drilled



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