Market is going to love these results,just came out!! - High Arctic reported revenue of $54.7 million, net earnings of $7.5 million and Adjusted EBITDA of $17.4 million in the quarter.
- Utilization for High Arctic’s 58 registered Concord Well Servicing rigs was 58% in the quarter versus industry utilization of 41% (source: Canadian Association of Oilwell Drilling Contractors “CAODC”).
- The Corporation completed the renegotiation of its expiring drilling contracts for a three-year contract renewal covering Rigs 103 and 104 operating in PNG.
- High Arctic completed the acquisition of Powerstroke and Saddle Well Services during the third quarter of 2018 which increased its snubbing and well servicing fleet and expanded its geographic footprint into the United States.
- Consistent with prior quarters, High Arctic declared $2.6 million ($0.05 per share) in dividends during the quarter which represents 18% of funds provided from operations in the quarter. In addition, High Arctic repurchased and cancelled 860,347 shares with a value of $3.4 million under the Corporation’s NCIB during the quarter resulting in a total of $6.0 million being returned to shareholders in the quarter via dividends and share repurchases.
Year to Date 2018:
- Year to date the Corporation reported revenue of $155.5 million, net earnings of $13.7 million and Adjusted EBITDA of $45.0 million.
- Rig 405 was demobilized back to Australia during the third quarter after operations were terminated due to a large earthquake that occurred in February 2018 that impacted the wellsite.
- High Arctic continues to maintain a strong balance sheet with $22.3 million in cash, for a total working capital balance of $64.2 million.
- A total of $16.6 million has been returned to shareholders year to date through dividends and share buybacks. The Corporation maintained it’s monthly dividend of $0.0165 per share resulting in year to date dividends declared of $7.8 million. The Corporation purchased and cancelled 2,227,774 shares for a total of $8.8 million under the Corporation’s NCIB.
Select Comparative Financial Information
The following is a summary of select financial information of the Corporation.
| | Three Months Ended September 30 | Nine Months Ended September 30 |
| $ millions (except per share amounts) | 2018 | | 2017 | | % Change | | 2018 | | 2017 | | % Change | |
| Revenue | 54.7 | | 42.8 | | 28 | % | 155.5 | | 158.7 | | (2 | %) |
| EBITDA(1) | 17.0 | | 11 | | 55 | % | 42.6 | | 46.5 | | (8 | %) |
| Adjusted EBITDA(1) | 17.4 | | 10.6 | | 64 | % | 45.0 | | 45.9 | | (2 | %) |
| Adjusted EBITDA % of revenue | 32 | % | 25 | % | 27 | % | 29 | % | 29 | % | (0 | %) |
| Operating earnings | 10.6 | | 4.1 | | 159 | % | 25.4 | | 26.4 | | (4 | %) |
| Net earnings | 7.5 | | 2.8 | | 168 | % | 13.7 | | 16.8 | | (18 | %) |
| per share (basic)(2) | 0.14 | | 0.06 | | 133 | % | 0.26 | | 0.32 | | (19 | %) |
| per share (diluted)(2) | 0.14 | | 0.05 | | 180 | % | 0.26 | | 0.31 | | (16 | %) |
| Adjusted Net earnings(1) | 7.7 | | 2.8 | | 175 | % | 14.5 | | 16.8 | | (14 | %) |
| per share (basic)(2) | 0.15 | | 0.06 | | 150 | % | 0.28 | | 0.32 | | (13 | %) |
| per share (diluted)(2) | 0.15 | | 0.05 | | 200 | % | 0.28 | | 0.31 | | (10 | %) |
| Funds provided from operations(1) | 14.3 | | 9.8 | | 46 | % | 34.8 | | 35.9 | | (3 | %) |
| per share (basic)(2) | 0.27 | | 0.18 | | 50 | % | 0.66 | | 0.67 | | (1 | %) |
| per share (diluted)(2) | 0.27 | | 0.18 | | 50 | % | 0.66 | | 0.67 | | (1 | %) |
| Dividends | 2.6 | | 2.6 | | 0 | % | 7.8 | | 7.9 | | (1 | %) |
| per share(2) | 0.05 | | 0.05 | | 0 | % | 0.15 | | 0.15 | | 0 | % |
| Capital expenditures | 2.2 | | 1.1 | | 100 | % | 6.1 | | 5.5 | | 11 | % |
| | | | | | | | As at | | |
| | | | | | | | September 30,
2018 | | December 31,
2017 | | % Change | |
| Working capital(1) | | | | | | | 64.2 | | 53.7 | | 20 | % |
| Total assets | | | | | | | 275.3 | | 267.0 | | 3 | % |
| Total non-current financial liabilities | | | | | | | 8.0 | | 3.6 | | 122 | % |
| Net cash, end of period(1) | | | | | | | 17.5 | | 22.1 | | (21 | %) |
| Shareholders’ equity | | | | | | | 233.3 | | 230.8 | | 1 | % |
| Shares outstanding(2) | | | | | | | 51.2 | | 53.3 | | (4 | %) |
| (1) | Readers are cautioned that EBITDA, Adjusted EBITDA, Adjusted net earnings, Funds provided from operations, Net cash and Working capital do not have standardized meanings prescribed by IFRS – see “Non IFRS Measures” on page 11 for calculations of these measures. |
| (2) | The number of shares used in calculating the net earnings per share and adjusted net earnings per share amounts is determined differently as explained in note 15 in the Financial Statements. |
Corporate Profile
Headquartered in Calgary, Alberta, Canada, High Arctic provides oilfield services to exploration and production companies operating in Canada, the United States and Papua New Guinea (“PNG”). High Arctic is a publicly traded company listed on the Toronto Stock Exchange under the symbol “HWO”.
High Arctic conducts its business operations in three separate operating segments: Drilling Services; Production Services; and Ancillary Se
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