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
|
|
|
Q4
2017
|
Q4 2016
|
2017
Annual
|
2016
Annual
|
Infrastructure
|
11,500
|
11,700
|
43,700
|
30,500
|
Oil sands
coring
|
7,000
|
700
|
19,900
|
5,600
|
Seismic (Track and
Heli portable)
|
-
|
-
|
700
|
-
|
Water
|
300
|
600
|
1,300
|
1,700
|
Geothermal &
geotechnical
|
23,300
|
21,200
|
116,300
|
123,400
|
|
42,100
|
34,200
|
181,900
|
161,200
|
MANUFACTURING
Revenues for Dando for the year ended December 31, 2017 were $7.0 million with a gross margin of 6% compared
to revenues of $10.1 million with a
gross margin of 11% in 2016. In 2017, a complete restructuring of
the manufacturing division was undertaken to improve profitability
while offering a more focused suite of products. The restructuring
process was completed in the second half of 2017 and the Company
has had several meaningful improvements in the production and
financial areas of the division in early 2018.
INDUSTRY OUTLOOK
The recovery taking hold in the Company's key divisions in 2017
has continued in 2018. Mineral drilling is expected to remain
stronger than in past years through the balance of the year in the
Company's strongest geographical regions, namely Central and
South America, as well as in
West Africa. In the energy
drilling division, stronger activity is expected to persist in 2018
as spending ramped up considerably in the most recent winter
drilling season. Management has deployed energy drilling equipment
in non-winter seasons when equipment typically sits idle, which has
led to new contracts in the green energy and infrastructure
drilling sectors. Public spending in North America on improving infrastructure and
developing the green economy has provided the Company with
significant opportunities to win new business as a diversification
to strictly commodity-based drilling activities.
A conference call is planned for April
18, 2018 at 10:00am Eastern
time. Dial-in numbers are (647) 689-4231 or (833)
297-9922.
Energold Drilling Corp. is a leading global specialty drilling
company that services the mining, energy, water, infrastructure and
manufacturing sectors in approximately 25 countries. Specializing
in a socially and environmentally sensitive approach to drilling,
Energold provides a comprehensive range of drilling services from
early stage exploration to mine site operations for all commodity
sectors and has an established drill rig manufacturer, Dando
Drilling International, based in the United Kingdom. Energold also holds 6.98
million shares of IMPACT Silver Corp., a silver producer in
Mexico.
On behalf of the Directors of Energold Drilling Corp.,
"Frederick W. Davidson"
President, CEO
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Forward-Looking Statements: Some statements in this news
release contain forward-looking information. These statements
include, but are not limited to, statements with respect to
proposed activities, work programs and future expenditures. These
statements address future events and conditions and, as such,
involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements to
be materially different from any future results, performance or
achievements expressed or implied by the statements. Such factors
include, among others, the effects of general economic conditions,
a reduction in the demand for the Company's drilling services, the
price of commodities, changing foreign exchange rates, actions by
government authorities, the failure to find economically viable
acquisition targets, title matters, environmental matters, reliance
on key personnel, the ability for operational and other reasons to
complete proposed activities and work programs, the need for
additional financing and the timing and amount of expenditures.
Energold Drilling Corp. does not assume the obligation to update
any forward-looking statement.
SOURCE Energold Drilling Group