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
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