Click here to close now.

SYS-CON MEDIA Authors: Liz McMillan, Pat Romanski, Carmen Gonzalez, Kevin Jackson, Peter Silva

News Feed Item

Enterprise Group Announces Results for the Second Quarter of 2014

ST. ALBERT, ALBERTA -- (Marketwired) -- 08/13/14 -- Enterprise Group, Inc. ("Enterprise," or "the Company") (TSX: E) is pleased to announce its financial results for the three month period ended June 30, 2014 ("the second quarter"). Enterprise's second quarter results reflect considerable contributions from acquisitions made during 2013, as well as steady demand for the Company's services.

SECOND QUARTER HIGHLIGHTS


--  Quarterly revenue of $14.1 million, an increase of $9.3 million, or
    194%, when compared to the prior year, due primarily to the impact of
    acquisitions.
--  Quarterly EBITDAS of $2.6, compared to approximately break-even in the
    prior year.
--  Enterprise in on track to deploy the $20.0 million in capital
    expenditures the Company planned for 2014. As a result, the substantial
    majority of the equipment purchased as a result of these expenditures
    will be active by the fourth quarter of 2014.
--  On July 31, 2014, the Company announced that it had signed a letter of
    intent to acquire a privately-owned oilfield site services rental
    company (the "Acquisition Target") based in Fort St. John, British
    Columbia. The Company expects to complete this acquisition by October
    2014.

----------------------------------------------------------------------------
                  Three months   Three months     Six months     Six months
Consolidated:    June 30, 2014  June 30, 2013  June 30, 2014  June 30, 2013
----------------------------------------------------------------------------
Revenue            $14,069,617     $4,831,035    $35,176,922    $13,735,415
Gross margin        $5,526,067     $1,671,955    $16,055,502     $6,873,922
Gross margin %              39%            35%            46%            50%
EBITDAS             $2,656,735         $4,862     $9,703,707     $3,906,165
Net Income            $329,959    $(1,542,924)    $4,656,775     $1,623,959
EPS                      $0.00         $(0.02)         $0.04          $0.03
Total Assets      $130,047,730    $48,955,461   $130,047,730    $48,955,461
----------------------------------------------------------------------------

Enterprise's second quarter results reflect both the continued positive impact of the acquisitions completed during the prior 12 months and steady demand for the Company's services. While the Company's EBITDAS and EBITDAS margin increased significantly when compared to the second quarter of 2013, both of these metrics declined when compared to the Company's results for the first quarter of 2014. These declines reflect the need for the Company to maintain commitments during a period of seasonal downturn in order to prepare for the higher demand for services during the second half of 2014, as well as an increased use of third-party equipment. Commitments during the second quarter included Enterprise maintaining a full complement of operational employees in order to prepare for a more robust business cycle during the latter half of the year. Both EBITDAS and EBITDAS margin are expected to improve meaningfully during the third and fourth quarters of 2014, due to both seasonal increases in demand and the replacement of subcontracted equipment by the capital assets the Company has purchased over the course of 2014. The Company's earnings per share increased slightly during the second quarter, primarily due to the improvements in both revenue and EBITDAS when compared to the second quarter of 2013.

Enterprise remains on track to deploy $20.0 million of capital expenditures over the course of 2014. These capital expenditures are intended to create improvements in both the Company's revenue and operating margins. Management believes these improvements will be reflected in the Company's operating results during the second half of 2014. The Company anticipates that it will have completed the substantial majority of its planned capital expenditures for 2014 by the conclusion of the third quarter.

"We are satisfied by Enterprise's results for the second quarter, which once again demonstrate the benefits of our selective acquisition strategy," stated Leonard Jaroszuk, the Company's Chief Executive Officer. "While this quarter's results are reflective of a seasonal slowdown, we were pleased by the consistent demand for our services, and by our ability to maintain our commitments to our workforce as we prepare for the second half of 2014."

"Seasonal demand is historically much higher during the latter half of the year, and Enterprise is ideally positioned to service this demand. Our capital spending over the course of 2014 has significantly increased our operating capacity. That capacity will grow further upon completion of our recently announced acquisition. The Fort St. John region is a critical area in the development of Western Canada's LNG industry. I am confident this acquisition will be immediately accretive to our business, and will establish Enterprise within Fort St. John and will better position us to meet the demands of the LNG industry."

"Over the past year, Enterprise has developed a track record of rapid and successful integration," concluded Mr. Jaroszuk. "We have already begun planning for the integration of this new addition. As a result, we anticipate that the fourth quarter of 2014 will not only reflect a full three months of this acquisition's contributions, but also benefit from its synergies with our existing operations. All of these factors - 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/Infras
 tructure          Three months   Three months     Six months     Six months
 Construction:    June 30, 2014  June 30, 2013  June 30, 2014  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          Three months  Three months      Six months     Six months
 Rental:          June 30, 2014 June 30, 2013   June 30, 2014  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.

About Enterprise Group, Inc.

Enterprise Group, Inc. is a consolidator of construction services companies operating in the energy, utility and transportation infrastructure industries. The Company's focus is primarily construction services and specialized equipment rental. The Company's strategy is to acquire complementary service companies in Western Canada, consolidating capital, management, and human resources to support continued growth. Enterprise acquired Artic Therm International Ltd. in September 2012, Calgary Tunnelling & Horizontal Augering Ltd. in June 2013, and Hart Oilfield Rentals Ltd. in January 2014.

Forward-Looking Information

Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company's future performance. The use of any of the words "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.

Non-IFRS Measures

The Company uses International Financial Reporting Standards ("IFRS"). EBITDAS is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-IFRS measure. This news release contains references to EBITDAS. This non-IFRS measure used by the Company may not be comparable to a similar measure used by other companies. Management believes that in addition to net income, EBITDAS is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDAS is calculated as net income excluding depreciation, amortization, interest, taxes and stock based compensation.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
SYS-CON Events announced today that On the Avenue Marketing Group, a sales and marketing firm that utilizes events to market and sell products to consumers, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. On the Avenue Marketing Group (OTA) is a sales and marketing firm that utilizes events to market and sell products to consumers. On behalf of our clients, we attend thousands of fairs, festivals, exp...
Containers and microservices have become topics of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 16th Cloud Expo at the Javits Center in New York June 9-11 will find fresh new content in a new track called PaaS | Containers & Microservices Containers are not being considered for the first time by the cloud community, but a current era of re-consideration has pushed them to the top of the cloud agenda. With the launch ...
While DevOps most critically and famously fosters collaboration, communication, and integration through cultural change, culture is more of an output than an input. In order to actively drive cultural evolution, organizations must make substantial organizational and process changes, and adopt new technologies, to encourage a DevOps culture. Moderated by Andi Mann, panelists will discuss how to balance these three pillars of DevOps, where to focus attention (and resources), where organizations m...
“In the past year we've seen a lot of stabilization of WebRTC. You can now use it in production with a far greater degree of certainty. A lot of the real developments in the past year have been in things like the data channel, which will enable a whole new type of application," explained Peter Dunkley, Technical Director at Acision, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
of cloud, colocation, managed services and disaster recovery solutions, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. TierPoint, LLC, is a leading national provider of information technology and data center services, including cloud, colocation, disaster recovery and managed IT services, with corporate headquarters in St. Louis, MO. TierPoint was formed through the strategic combination of some of t...
SYS-CON Events announced today that Column Technologies, a global technology solutions company, will exhibit at SYS-CON's DevOps Summit 2015 New York, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. Established in 1998, Column Technologies is a leader in application performance and infrastructure management for commercial and federal markets. The company is headquartered in the United States, with a diverse and talented team of more than 350 employees around th...
Health care systems across the globe are under enormous strain, as facilities reach capacity and costs continue to rise. M2M and the Internet of Things have the potential to transform the industry through connected health solutions that can make care more efficient while reducing costs. In fact, Vodafone's annual M2M Barometer Report forecasts M2M applications rising to 57 percent in health care and life sciences by 2016. Lively is one of Vodafone's health care partners, whose solutions enable o...
SYS-CON Events announced today that Ciqada will exhibit at SYS-CON's @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Ciqada™ makes it easy to connect your products to the Internet. By integrating key components - hardware, servers, dashboards, and mobile apps - into an easy-to-use, configurable system, your products can quickly and securely join the internet of things. With remote monitoring, control, and alert messaging capability, you will mee...
SYS-CON Media announced today that @WebRTCSummit Blog, the largest WebRTC resource in the world, has been launched. @WebRTCSummit Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @WebRTCSummit Blog can be bookmarked ▸ Here @WebRTCSummit conference site can be bookmarked ▸ Here
Public Cloud IaaS started it's life in the developer and startup communities and has grown rapidly to a $20B+ industry, but it still pales in comparison to how much is spent worldwide on IT: $3.6 trillion. In fact, there are 8.6 million data centers worldwide, the reality is many small and medium sized business have server closets and colocation footprints filled with servers and storage gear. While on-premise environment virtualization may have peaked at 75%, the Public Cloud has lagged in ado...
Dave will share his insights on how Internet of Things for Enterprises are transforming and making more productive and efficient operations and maintenance (O&M) procedures in the cleantech industry and beyond. Speaker Bio: Dave Landa is chief operating officer of Cybozu Corp (kintone US). Based in the San Francisco Bay Area, Dave has been on the forefront of the Cloud revolution driving strategic business development on the executive teams of multiple leading Software as a Services (SaaS) ap...
The best mobile applications are augmented by dedicated servers, the Internet and Cloud services. Mobile developers should focus on one thing: writing the next socially disruptive viral app. Thanks to the cloud, they can focus on the overall solution, not the underlying plumbing. From iOS to Android and Windows, developers can leverage cloud services to create a common cross-platform backend to persist user settings, app data, broadcast notifications, run jobs, etc. This session provide...
SYS-CON Events announced today that GENBAND, a leading developer of real time communications software solutions, has been named “Silver Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. The GENBAND team will be on hand to demonstrate their newest product, Kandy. Kandy is a communications Platform-as-a-Service (PaaS) that enables companies to seamlessly integrate more human communications into their Web and mobile applicatio...
SYS-CON Events announced today that BroadSoft, the leading global provider of Unified Communications and Collaboration (UCC) services to operators worldwide, has been named “Gold Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. BroadSoft is the leading provider of software and services that enable mobile, fixed-line and cable service providers to offer Unified Communications over their Internet Protocol networks. The Compa...
While not quite mainstream yet, WebRTC is starting to gain ground with Carriers, Enterprises and Independent Software Vendors (ISV’s) alike. WebRTC makes it easy for developers to add audio and video communications into their applications by using Web browsers as their platform. But like any market, every customer engagement has unique requirements, as well as constraints. And of course, one size does not fit all. In her session at WebRTC Summit, Dr. Natasha Tamaskar, Vice President, Head of C...