Pulse Seismic Inc. (“Pulse” or “the Company”) reports its preliminary selected unaudited financial and operating results for the three months ended March 31, 2015 .
These financial results are based on management’s estimates and have not yet been approved by the Company’s Audit Committee or Board of Directors or reviewed by the Company’s auditors.
Pulse expects to release its full financial results for the three months ended March 31, 2015 on May 8, 2015 .
“Data library sales for the quarter were a record low of $1.3 million due to the drastic cutback in the E&P sector’s capital spending so far in 2015,” stated Neal Coleman , Pulse’s President and CEO. “Although we frequently note that the Company’s results vary from quarter to quarter and should be viewed annually, the fact that the data library did not generate positive shareholder free cash flow in the quarter highlights the severity of the downturn.”
HIGHLIGHTS FOR THE THREE MONTHS ENDED MARCH 31, 2015
Pulse’s key performance metrics all declined in the three-month period ending March 31, 2015 from the prior year’s first quarter, due to the period’s record low level of data library sales. Highlights for the quarter:
- Total seismic revenue of $4.5 million , consisting of data library sales of $1.3 million and participation survey revenue of $3.2 million , compared to $5.5 million during the three months ended March 31, 2014 , consisting entirely of data library sales;
- Cash EBITDA(a) was negative $240,000 compared to $3.8 million in the comparable period in 2014;
- Shareholder free cash flow(a) was negative $347,000 compared to $3.6 million in the comparable period in 2014;
- Funds from operations(b) were $2.9 million compared to $3.6 million for the three months ended March 31, 2014 ;
- Net loss of $3.3 million ( $0.06 per share basic and diluted) compared to a net loss of $1.8 million ( $0.03 per share basic and diluted) in the comparable period in 2014;
- Pulse purchased and cancelled, through its normal course issuer bid, a total of 335,200 common shares at a total cost of approximately $1.0 million (at an average cost of $3.01 per common share including commissions);
- At March 31, 2015 Pulse’s cash balance was $586,000 and total debt(c) was $5.5 million , resulting in a net debt (d) position of $4.9 million . This was an improvement of $12.8 million from net debt of $17.7 million at March 31, 2014 ; and
- The Company added 136 square kilometres of new high quality 3D seismic data to the library through the completion of a survey in west central Alberta which commenced in January and was completed in March 2015 .
(a) The Company’s continuous disclosure documents provide discussion and analysis of “cash EBITDA”, “cash EBITDA per share”, “shareholder free cash flow” and “shareholder free cash flow per share”. These financial measures do not have standard definitions prescribed by IFRS and, therefore, may not be comparable to similar measures disclosed by other companies. The Company has included these non-GAAP financial measures because management, investors, analysts and others use them as measures of the Company’s financial performance. The Company’s definition of cash EBITDA is cash available for interest payments, cash taxes if applicable, debt servicing, discretionary capital expenditures and the payment of dividends, and is calculated as earnings (loss) from operations before interest, taxes, depreciation and amortization less participation survey revenue, plus any non-cash and non-recurring expenses. Cash EBITDA excludes participation survey revenue as these funds are directly used to fund specific participation surveys and this revenue is not available for discretionary capital expenditures. The Company believes cash EBITDA assists investors in comparing Pulse’s results on a consistent basis without regard to participation survey revenue and non-cash items, such as depreciation and amortization, which can vary significantly depending on accounting methods or non-operating factors such as historical cost. Cash EBITDA per share is defined as cash EBITDA divided by the weighted average number of shares outstanding for the period. Shareholder free cash flow further refines the calculation of capital available to invest in growing the Company’s 2D and 3D seismic data library, to repay debt, to purchase its common shares and to pay dividends by deducting non-discretionary expenditures from cash EBITDA. Non-discretionary expenditures are defined as debt financing costs (net of deferred financing expenses amortized in the current period) and current tax provisions. Shareholder free cash flow per share is defined as shareholder free cash flow divided by the weighted average number of shares outstanding for the period.
(b) Funds from operations is an additional GAAP measure. Funds from operations is defined as cash provided by operations as prescribed by IFRS, excluding the impact of changes in non-cash working capital. Funds from operations represents the cash that was generated during the period, regardless of the timing of collection of receivables and payment of payables. Funds from operations per share is defined as funds from operations divided by the weighted average number of shares outstanding for the period.
(c) Total debt is defined as long-term debt, excluding deferred financing costs.
(d) Net debt is defined as total debt less cash.
Pulse is a market leader in the acquisition, marketing and licensing of 2D and 3D seismic data to the western Canadian energy sector. Pulse owns the second-largest licensable seismic data library in Canada , currently consisting of approximately 28,400 square kilometres of 3D seismic and 340,000 kilometres of 2D seismic. The library extensively covers the Western Canada Sedimentary Basin where most of Canada’s oil and natural gas exploration and development occur.
SOURCE Pulse Seismic Inc.