Second Quarter Results Primawave(TM) ProcessWavefront Energy and Environmental Services Inc. Announces Second Quarter Results Primawave(TM) Process Used at Vandenberg Air Force Base
Wavefront Energy and Environmental Services Inc. ("Wavefront") (TSX-V: WEE), a leader in technology development and implementation for improved oil recovery and optimized groundwater remediation, announces its financial and operating results for the second quarter ended February 28, 2007.
Revenue for the three months ended February 28, 2007 was $357,877 contrasted to revenue of $92,548 for last year. The increase is principally a result of the increase in interest income generated from guaranteed investment certificates that resulted from recent private placements.
During the current reporting period the Wavefront has focused its resources on Powerwave showcasing the process in oilfields where it has acquired mineral rights. Approximately 14% of revenues for the quarter were generated from activities associated with Powerwave, and 29% of revenue was generated from activities related to the activities and production of Rogers County, Oklahoma and with Greentree Gas and Oil Ltd., Farm-in.
Wavefront's consolidated net loss for the three months ended February 28, 2007 was $1,025,658 ($0.02 per share) contrasted to a consolidated net loss for the comparative period ended February 28, 2006 of $573,273 ($0.02 per share). The increase in net losses for the three month period is primarily due to increases in operating expenses of $1,239,901 from the $637,191 incurred for the same comparative period (three months ended February 28, 2006).
Wage expenses increased by $396,375, travel and promotion of $23,698, professional fees of $74,039, office expenses by $40,066, and consulting fees of $25,653. The aforementioned variances in expenses reflect Wavefront's inclusion of the fair market value of stock options as a wage expense, involvement in developing the Rogers County oilfield to showcase Powerwave, and further due diligence related to the acquisition of additional oil field leases. For the three months ended February 28, 2007, total assets decreased by $1,259,763 compared to $17,444,633 at August 31, 2006, which was principally due to supporting activities associated with the commercialization of Powerwave. The activities associated with Rogers County and Greentree Gas and Oil Ltd. has an affect of decreasing cash with a corresponding increase in long-term assets by $3,251,919.
Efforts in fiscal 2007 will continue to focus on bringing Wavefront to a positive cash flow position. We will endeavor to accomplish this through (1) increased cash flow from production operations in Rogers County and with Greentree Gas and Oil Ltd.; (2) increased licensing revenues in both the oil and environmental sector; (3) further market exposure and increased revenue for Wavefront Sand Pumps and Rentals; (4) acquiring additional oil field leases, or joint venturing with proactive companies to implement Powerwave; (5) implement Powerwave waterflood projects with mainstream producers; and, (5) close the acquisition of ICI Solutions Inc.
The above financial highlights should be read in conjunction with the unaudited consolidated financial statements and management discussion and analysis of results for Wavefront's most recently completed quarter, ended February 28, 2007, which have been filed of SEDAR.
Wavefront would also like to announce that it has commenced an installation of its Primawave Process at Vandenberg Air Force Base in California. The objective of the project is to use Primawave, specifically the Hornet tool, to achieve pin-point placement, and more uniform distribution of a remedial fluid into a tight sand formation exhibiting extremely low flow characteristics. Previous attempts to pin-point inject the remedial fluid using other injection approaches met with limited or no success. Based on previous positive results of Primawave where fluids have been injected with pin-point accuracy, up to five times faster and with ten times the distribution distance compared to traditional injection approaches, the client has systematically identified the process as the only alternative to successfully introduce the remedial fluids into the subsurface to meet its targeted goals.
Wavefront President and CEO Brett Davidson commented, "The Vandenberg site is one of, if not the most difficult, geological settings that Primawave has been utilized on. Although we hold great confidence in the Hornet tool, the uncertainty of the overall flow characteristics will present a unique challenge to which other technologies have already met with disappointment. If we can achieve a measure of success where others have failed or were at best marginal, Primawave will have clearly distinguished itself from all other injection approaches, which should result in further market penetration and licensing revenue."
About Wavefront Energy and Environmental Services Inc.
Wavefront is a technology-based company with a focused, strategic plan to leverage the value of our intellectual property in order to maximize oil production recovery operations, as well as provide additional solutions for environmental applications.
ON BEHALF OF THE BOARD OF DIRECTORS
WAVEFRONT ENERGY AND ENVIRONMENTAL SERVICES INC.
"D. Brad Paterson" (signed)
D. Brad Paterson, CFO & Director
www.onthewavefront.com
Cautionary Disclaimer - Forward Looking Statements
Certain statements contained herein regarding Wavefront and its operations constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plan, objectives, assumptions or expectations or future performance, are "forward-looking statements." We caution that such "forward-looking statements" involve known and unknown risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such statements. Wavefront expressly disclaims any obligation to up-date any "forward-looking statements."
Powerwave and Primawave are registered trademarks of Wavefront Energy and Environmental Services Inc.
THE TSX VENTURE EXCHANGE NEITHER APPROVES NOR DISAPPROVES THE CONTENTS OF THIS RELEASE WHICH WAS PREPARED SOLELY AT THE DISCRETION OF MANAGEMENT.
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