DENVER, CO--(Marketwired - Aug 13, 2013) - ENSERVCO Corporation (OTCQB: ENSV) 

Selected Highlights:

• Second quarter adjusted EBITDA improves 329% to $1.4 million versus Q2 2012
• Six-month adjusted EBITDA up 261% to $8.7 million versus 2012 six-month period
• Six-month net income improves to $4.1 million, or $0.12 per diluted share
• Six-month cash flow from operations improves 337% to $8.5 million
• Cash position increases to $5.7 million from $534,000 at December 31, 2012
• Stockholders approve process for up-listing common stock to major exchange

ENSERVCO Corporation (OTCQB: ENSV), a provider of well-site services to the domestic onshore conventional and unconventional oil and gas industries, today announced revenue and earnings* for its second quarter ended June 30, 2013.

Second quarter revenue increased 44% to a record $7.9 million from $5.5 million in the second quarter last year. The increase resulted from continued strong demand for ENSERVCO's well enhancement services (frac heating, hot oiling, well acidizing and pressure testing), which increased 78% to $5.8 million from $3.2 million in last year's second quarter. The improvement is largely attributable to increased drilling activity by customers in the Company's Rocky Mountain and eastern U.S. service territories, new hydraulic fracturing designs, and increased hot oiling capacity. Revenue from ENSERVCO's fluid management services (water hauling/disposal and frac tank rentals) was relatively flat at $2.1 million versus $2.2 million in the 2012 second quarter.

From a geographic perspective, second quarter revenue from the Company's Rocky Mountain region increased 60% to $4.4 million from $2.8 million in the same quarter last year. Revenue from the eastern region increased 271% to $894,000 from $241,000, and revenue from the central U.S. region increased 4% to $2.6 million from $2.5 million in the second quarter last year.

Second quarter gross margin increased to 29% from 20% in the prior year's second quarter. The improvement is principally attributable to greater revenue from higher margin well enhancement services.

Second quarter operating income was $552,000, a positive swing of $935,000 when compared with an operating loss of $383,000 in the second quarter a year ago. Net Income was $191,000, or $0.01 per diluted share, on 35.7 million diluted shares outstanding, versus a net loss of $442,000, or $0.02 per diluted share, on 21.8 million diluted shares outstanding, in the comparable year-ago quarter.

Second quarter adjusted EBITDA* increased 329% to $1.4 million from $326,000 in the 2012 second quarter.

Six-month results
Revenue for the six-month period increased 76% to $26.5 million from $15.0 million in the same period a year ago, while gross margin increased to 40% from 27%.

Operating income increased to $7.2 million from $338,000 in the six-month period last year. Net income increased to $4.1 million, or $0.12 per diluted share, from a net loss of $162,000, or $0.01 per diluted share. Income in the 2013 six-month period reflected a $738,000 decrease in depreciation expense versus the same period last year. The decrease resulted from a reassessment of the estimated useful lives of the Company's trucks, equipment and disposal wells in April 2012.

Adjusted EBITDA in the year-to-date period increased 261% to $8.7 million from $2.4 million during the first six months of 2012. 

Operating cash flow during the first six months of 2013 was $8.5 million, up 325% from $2.0 million at the six-month mark last year. The increase was largely due to strong cash collections following the Company's record fourth quarter 2012 and first quarter 2013 revenue results, and was partially offset by reductions in accounts payable and accrued expenses. 

ENSERVCO closed the second quarter with cash and cash equivalents of $5.7 million, up from $534,000 at December 31, 2012. The Company's working capital position at June 30, 2013 improved to $7.8 million from $1.5 million at the end of 2012.

Management Commentary
"We have seen a significant increase in exploration and production activity in our service territories, particularly in Colorado and Wyoming's D-J Basin," said Rick Kasch, president. "This is fueling increased demand for our full suite of well enhancement services, and is driving much improved financial performance. On a trailing 12-month basis, we have reported revenue of $43.3 million and adjusted EBITDA of $11.1 million."

"Evolving frac designs being employed by several of our customers continue to extend our frac water heating season. Some of our customers have requested water temperatures of up to 25 degrees warmer than historic levels. These changes have somewhat tempered the seasonal slowdown we have historically seen during the summer months."

Kasch said that after a pause in frac heating work during July, the Company recently commenced a project for a large customer targeting Colorado's Niobrara formation. "This represents the earliest we have restarted our frac heating services after the summer break."

He added, "Our capital expenditure and equipment fabrication programs are proceeding on plan, and we expect several additional hot oiling and frac water heating units will enter the field before the fall start to our busy season." 

Kasch said the added capacity will come at an ideal time, as the Company is pursuing additional geographic expansion opportunities that would extend ENSERVCO's service territory farther into the western United States. "Active exploration of North America's unconventional shale formations is creating new opportunities for the energy industry, and we stand to be a direct beneficiary," Kasch said. "We are very optimistic about ENSERVCO's prospects for continued operational and financial growth." 

In other news, stockholders recently authorized the Company, at the board of directors' discretion, to execute a reverse split of the Company's stock for the purpose of up-listing ENSERVCO's shares to a major U.S. exchange. The reverse split was authorized within a range 1-for-2 to 1-for-3. The Company intends to begin the application process in the coming weeks for a listing on the NYSE-MKT Exchange. If approved by the Exchange, the reverse split could be executed within a six-month window following the authorization. 

Conference Call Information
Management will hold a conference call today to discuss these results. The call will begin at 1 p.m. Eastern (11 a.m. Mountain) and will be accessible by dialing 877-407-8031 (201-689-8031 for international callers). No passcode is necessary. A telephonic replay will be available through August 21, 2013, by calling 877-660-6853 (201-612-7415 for international callers) and entering the Conference ID #418969. To listen to the webcast, participants should access the ENSERVCO website, located at www.enservco.com, and link to the "Investors" page at least 15 minutes early to register and download any necessary audio software. A replay of the webcast will be available for 90 days.

About ENSERVCO
Through its various operating subsidiaries, ENSERVCO has emerged as one of the energy service industry's leading providers of hot oiling, acidizing, frac heating and fluid management services. The Company owns and operates a fleet of more than 230 specialized trucks, trailers, frac tanks and related well-site equipment. ENSERVCO serves customers in six major domestic oil and gas fields, and operates in Colorado, Kansas, Montana, New Mexico, North Dakota, Oklahoma, Pennsylvania, Ohio, Texas, Wyoming and West Virginia. Additional information is available at www.enservco.com.

*Note on non-GAAP Financial Measures
This press release and the accompanying tables include a discussion of EBITDA and Adjusted EBITDA, which are non-GAAP financial measures provided as a complement to the results provided in accordance with generally accepted accounting principles ("GAAP"). The term "EBITDA" refers to a financial measure that we define as earnings plus or minus net interest plus taxes, depreciation and amortization. Adjusted EBITDA excludes from EBITDA stock-based compensation and, when appropriate, other items that management does not utilize in assessing ENSERVCO's operating performance (as further described in the attached financial schedules). None of these non-GAAP financial measures are recognized terms under GAAP and do not purport to be an alternative to net income as an indicator of operating performance or any other GAAP measure. We have reconciled Adjusted EBITDA to GAAP net income in the Consolidated Statements of Operations table at the end of this release. We intend to continue to provide these non-GAAP financial measures as part of our future earnings discussions and, therefore, the inclusion of these non-GAAP financial measures will provide consistency in our financial reporting.

*All revenue and earnings results discussed herein exclude discontinued operations, which resulted in pretax losses of (a) $2,000 and $151,000 for the second quarters of 2013 and 2012, respectively, and (b) $120,000 and $317,000 for the six-month periods of 2013 and 2012, respectively. 

Cautionary Note Regarding Forward-Looking Statements
This news release contains information that is "forward-looking" in that it describes events and conditions ENSERVCO reasonably expects to occur in the future. Expectations for the future performance of ENSERVCO are dependent upon a number of factors, and there can be no assurance that ENSERVCO will achieve the results as contemplated herein. Certain statements contained in this release using the terms "may," "expects to," and other terms denoting future possibilities, are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks, which are beyond ENSERVCO's ability to predict, or control and which may cause actual results to differ materially from the projections or estimates contained herein. Among these risks are those set forth in a Form 10-K filed on March 28, 2013. It is important that each person reviewing this release understand the significant risks attendant to the operations of ENSERVCO. ENSERVCO disclaims any obligation to update any forward-looking statement made herein.