Xtreme Drilling and Coil Services Reports Full Year 2015 Financial and Operating Results, 2016 Outlook, and Executes Amended and Restated Credit Agreement
CALGARY, ALBERTA
--(Marketwired - March 10, 2016) -
Xtreme Drilling and Coil Services Corp. ("Xtreme", the "Company") (TSX:XDC) announce fourth quarter and full year 2015 financial and operating results. It is anticipated that filing will take place on SEDAR of annual audited Consolidated Financial Statements as well as Management's Discussion and Analysis for the year ended December 31, 2015, the week of March 14, 2016.
2015 Highlights
(amounts in thousands of Canadian dollars, unless otherwise noted)
-- Adjusted EBITDA of $9.9 million in the fourth quarter of 2015, down from
$15.4 million in the previous quarter. For the year ended December 31,
2015, adjusted EBITDA decreased 21 percent to $61.2 million as compared
to $77.0 million in 2014. Adjusted EBITDA margin as a percent of revenue
marginally decreased in 2015 to 27.6% from 28.8% in 2014.
-- Revenue of $45.4 million in the fourth quarter of 2015, a decrease of 13
percent from $52.2 million in the previous quarter. For the year ended
December 31, 2015, the Company recognized revenue of $221.4 million, a
decrease of 17%, or $46.1 million from 2014. The decrease in revenue for
the year was primarily a function of decreased operating days and
utilization in the US and Canadian Drilling Segments. Total operating
days across the Company decreased to 6,057 for 2015 as compared to 8,135
in 2014.
-- For the fourth quarter, overall revenue per operating day decreased by
4% to $34,300 from the prior quarter, driven by lower rates across
operations in
the United States
. XDR drilling revenue per day decreased
by 10% during the quarter to $25,066 while XSR coiled tubing revenue per
day decreased by 2% during the fourth quarter to $56,314.
-- For the fourth quarter, the Drilling Segment achieved utilization of 48%
on 932 operating days. This was comprised of a 53% utilization rate for
the 16 rig US XDR fleet, 3% for the three rig Canadian XDR fleet and 77%
for the two rigs in
India
. For the year ended 2015, the Drilling Segment
achieved utilization of 58% on 4,458 operating days. This was comprised
of a 62% utilization rate for the 16 rig US XDR fleet and 15% for the
three rig Canadian XDR fleet. The two XDR rigs that operated in
India
achieved a 93% utilization for the year. At the end of the fourth
quarter six rigs were operating in
the United States
and no rigs were
operating in
Canada
. The two rigs in
India
drilled the contract's final
wells in early December and commenced winding down of operations toward
the end of the year.
-- For the fourth quarter, the Coil Services Segment achieved utilization
of 61% on 392 operating days. This was comprised of a 97% utilization
rate for the two XSR units in
Saudi Arabia
and a 65% utilization rate
for the five actively marketed XSR units in the US. Included in the
total Coil Services utilization is one additional unit that is currently
idle in the US, but is actively being marketed internationally. The US
XSR units for the quarter averaged 11 to 16 operating days per month on
each unit. For the year ended 2015, the Coil Services Segment achieved
utilization of 63% on 1,599 operating days. This was comprised of a 98%
utilization rate in for the two XSR units in
Saudi Arabia
and a 57%
utilization rate for the five actively marketed XSR units in the US.
-- The Drilling Segment (which includes US,
Canada
and
India
) operating
profit decreased to $48.9 million in 2015 as compared to $58.5 million
the previous year. This was driven primarily by lower revenues in US and
Canadian segments. Overall operating margin increased to of 37.2% in the
Drilling Segment as compared to 31.8% in 2014. This was a function of
greater cost controls and contract termination revenue.
-- The Coil Services Segment (which includes US and
Saudi Arabia
) operating
profit decreased to $31.2 million in 2015 as compared to $34.8 million
in the previous year. This was driven by higher operating expenses in
the US segment as well as lower pricing on the international project.
Overall operating margin as a percent of revenue decreased to 34.7% in
2015 from 41.5% in 2014.
-- Total capital expenditures were $20.0 million during 2015. This is $2
million lower than the planned capital budget of $22 million and down
from total capital expenditures of $65.3 million in 2014. The decrease
is attributable to the completion of the XSR coiled tubing unit new
build program.
-- During the fourth quarter the Company recognized $2.6 million in early
termination revenue on the take or pay contracts. Year-to-date Xtreme
has recognized $14.3 million in early contract termination revenue. At
the end of the quarter, the Company had approximately 980 days
contracted under term contracts across the fleet.
-- The Company reviews the carrying value of its long-lived assets at each
reporting period for indicators of impairment. During the year ended
December 31, 2015, the decline in oil and natural gas prices resulted in
significant decreases in industry activity, adversely impacting current
and expected future business and estimated recoverable amounts. As a
result of the indicators and as required under IFRS, the Company
performed a comprehensive assessment of the carrying values of property
and equipment for each of its cash generating units. The recoverable
amount of each cash generating unit was determined using higher of fair
value less cost of disposal or value in use. Fair value based on an
independent valuation report and comparable transactions in the market.
Value in use was determined using a pre-tax discounted cash flow model.
For the year ended December 31, 2015, the Company recorded an impairment
charge on assets of $38.4 million.
-- The Company finished 2015 with $107.3 million in total debt and $96.1
million in net debt (total debt less cash). The funded debt to EBITDA
ratio was 1.7x and the net debt to EBITDA was to 1.5x. This is
consistent with the 1.7x and 1.5x respectively at year end 2014. On a US
Dollar basis, in which the Company primarily borrows, the funded debt
decreased $32.0 million USD during 2015 to an ending balance of $78.0
million USD.
-- On March 10, 2016, the Company reached an agreement with a syndicate of
financial institutions to enter into an amended and restated senior
credit facility for $90 million USD. The new credit facility consists of
a tranche of $78 million denominated in USD, and a $12 million USD-
equivalent tranche, available in CAD and/or USD. The amended facility
extends the maturity of the current outstanding debt from December 27,
2016, to January 2, 2018, and provides a source of liquidity for the
Company. Among other changes, the amended and restated facility gives
the Company financial flexibility, including increasing the funded debt
to EBITDA covenant to 3.00x through the quarter ending March 31, 2016,
to 3.25x through the quarter ending June 30, 2017 and 3.00x thereafter.
-- In response to the decrease in drilling and coil service activity, the
Company has decreased the estimated capital budget to approximately $9.0
million for 2016. The current budget estimate includes all maintenance,
critical spare and upgrade capital for the existing fleet. Xtreme
anticipates that all capital expenditures will be funded exclusively
through operating cash flow.
-- At year end the Company had six of 21 XDR rigs operating and six of ten
XSR units operating. Currently the Company has four of 21 XDR rigs
earning revenue with a fifth rig set to commence drilling in the next
week. In addition, the Company is earning standby revenue on two rigs
demobilizing from
India
to
the United States
.
Selected Quarterly Financial Information
(unaudited)
Dec 31, Sep 30, Jun 30, Mar 31,
Three months ended 2015 2015 2015 2015
----------------------------------------------------------------------------
Revenue 45,438 52,238 53,668 70,015
Adjusted EBITDA 9,911 15,444 15,036 20,761
Adjusted EBITDA as a
percentage of revenue 22 29 28 30
Adjusted EBITDA per share -
basic ($) 0.11 0.18 0.18 0.25
Net (loss) income (21,728) (48,595) (776) 2,755
Net (loss) income per share -
basic ($) (0.27) (0.59) (0.01) 0.03
Capital assets 446,417 445,591 473,030 488,300
Total assets 512,226 528,120 567,050 592,194
Net debt 96,123 93,389 112,133 126,869
----------------------------------------------------------------------------
Operating days 1,324 1,459 1,451 1,823
Utilization (percentage) -
XDR 48 55 56 73
Utilization (percentage) -
XSR 61 60 61 71
Utilization (percentage) -
Total 51 56 57 73
Weighted average rigs in
service 31.0 30.0 30.0 30.0
Total rigs, end of quarter 31 31 30 30
----------------------------------------------------------------------------
Dec 31, Sep 30, Jun 30, Mar 31,
2014 2014 2014 2014
----------------------------------------------------------------------------
Revenue 69,459 65,980 62,299 69,703
Adjusted EBITDA 18,617 18,299 19,421 20,635
Adjusted EBITDA as a
percentage of revenue 27 28 31 30
Adjusted EBITDA per share (1)
- basic ($) 0.23 0.22 0.24 0.25
Net (loss) income (2,258) 853 (902) 2,896
Net (loss) income per share -
basic ($) (0.03) 0.01 (0.01) 0.04
Capital assets 452,974 443,304 413,296 423,204
Total assets 547,958 536,713 513,651 532,116
Net debt 115,520 116,768 105,358 125,389
----------------------------------------------------------------------------
Operating days 2,053 2,173 1,779 2,130
Utilization (percentage) -
XDR 86 92 75 90
Utilization (percentage) -
XSR 74 73 68 78
Utilization (percentage) -
Total 83 88 73 88
Weighted average rigs in
service 28.0 28.0 28.0 28.0
Total rigs, end of quarter 29 28 28 28
----------------------------------------------------------------------------
Excerpt from Management's Discussion and Analysis
for the twelve months ended December 31, 2015
OUTLOOK
In the fourth quarter oilfield service activity continued to deteriorate as the active rig count in the US decreased by 17% from the third quarter and ended 2015 at 698 operating rigs. Through the end of February 2016 it has fallen to 502 working rigs, or a decrease of almost 1,200 from year ago levels. This rapid decrease in drilling activity has forced contractors to compete aggressively on price. In most resource plays spot day rates are down 35% to 45% from 18 months ago.
Despite the significant decrease in drilling rig activity, US oil production levels remained resilient through 2015. Total lower 48 production ended the year at 8.7 million barrels per day which was down from the June peak of 9.2 million barrels of production per day. The slower than forecast decrease in production has led to record levels of oil in storage and a further leg down in oil prices. As such, customer capital budgets have been decreased significantly in 2016 with most announcements in the range of 40% to 50% reductions from 2015 levels. This should lead to faster production declines in 2016 and the potential for a bottoming in oil prices. Oilfield service activity levels will likely remain depressed in 2016 with the potential for increased utilization in 2017. However, it is likely that pricing will remain down even after utilization begins to increase due to the large over supply of drilling and completion equipment.
Xtreme management moved quickly to decrease the Company's operating cost structure at the first sign of slowing activity levels in 2014. This early action along with subsequent measures helped to position the Company for the prolonged nature of the current downturn. The focus in 2016 will be to further solidify the balance sheet and maximize liquidity. As this cycle lingers liquidity will be even more important and could open up opportunities to acquire distressed assets or companies. When activity levels begin to improve it is clear that asset quality will be paramount. The drilling market has made what appears to be a fundamental shift to tier 1 rigs. According to industry sources the AC tier 1 rig count now stands at 257 active rigs or 60% of the total rig count. This is an all-time high market share for AC rigs and evidence that increased efficiency drives value. In most unconventional basins rig efficiency has significantly decreased well costs and allowed operators to drill up to 50% more wells per year than just three years prior. Xtreme's entire fleet of 21 drilling rigs are highly efficient AC electric tier 1 rigs.
In the Company's core US coiled tubing markets of the Eagle Ford and the Permian, customer preference has clearly shifted to larger diameter coiled tubing. This represents a complete change in mindset from 2012 when Xtreme first introduced 2 5/8" coil in
Texas
and 2" and smaller coil units dominated the market. The Company has now completed over 1,200 jobs and 82,000,000 round trip running feet over the past 3.5 years; the most of any large coil provider in the Eagle Ford or Permian. Due to the challenged environment it is likely that utilization and pricing will remain weakened as the rig count in the Eagle Ford has fallen by 129 rigs to just 29 currently operating. In addition, it is estimated that a drilled but uncompleted inventory of 3,000 wells currently exists in the Eagle Ford and West Texas. This has compounded the reduction in completion activity. However, as the industry begins to stabilize it is likely that most companies will initially focus on completing the significant inventory of drilled but uncompleted wells. These have the quickest cash conversion and lowest amount of capital outlay. For this reason we believe
Xtreme's coiled tubing activity should increase before the Company's drilling activity.
Internationally the push for increased technology is expected to continue. Most international operators have not deployed the level of technology and thus achieved the same levels of efficiency as many US operators. The push in
Saudi Arabia
is for greater efficiency through the integration of technology across the service spectrum. The underbalanced coiled tubing drilling project that
Xtreme is currently working on continues to produce outstanding performance and results. The Company is working harder than ever to leverage this success into increased revenue in Saudi and throughout the region.
Overall, Xtreme's leadership team has managed through both upswings and down markets. We understand the importance of cost management and a strong balance sheet in challenging times. The recent extension of the Company's credit facility provides the Company with continued balance sheet stability. In addition, the Company's leverage ratios are among the lowest in the industry, particularly as compared to similar sized competitors. Finally the industry leading XSR coil technology and 100% AC electric XDR drilling fleet is among the highest spec asset base in the industry. These factors should allow Xtreme to weather the current downturn and emerge as a stronger Company in the next up cycle.
Conference Call Details
Tom Wood, Chief Executive Officer, will host the conference call with participation from Matt Porter, President and Chief Financial Officer, and will answer questions from analysts and investors on Friday, March 11, 2016, beginning promptly at 9:00 am MT (10:00 am CT, 11:00 am ET).
To participate in the conference call, please dial in as follows approximately ten minutes before the start time in your time zone.
+1 800-952-6845 (North America Toll-Free) or +1 416-340-8527 (Alternate)
Webcast link: http://www.gowebcasting.com/7269
An audio replay of the call will be available until Friday, March 18, 2016. To access the replay, call +1 800-408-3053 or +1 905-694-9451 and enter pass code 9246719.
Xtreme Drilling and Coil Services Corp.
Consolidated Statements of Financial Position
At December 31, 2015 and December 31, 2014
(in thousands of Canadian dollars)
(unaudited)
Dec 31, Dec 31,
2015 2014
-----------------------
-----------------------
Assets
Current assets
Cash and cash equivalents 11,223 13,102
Accounts receivable 39,771 51,125
Other receivables 351 255
Prepaid expenses and other 2,461 1,998
Inventory 8,693 11,405
-----------------------
62,499 77,885
Non-current assets
Deferred tax asset - 13,486
Property and equipment 446,417 452,974
Intangible assets 3,310 3,613
-----------------------
Total Assets 512,226 547,958
-----------------------
-----------------------
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities 29,729 39,738
Income tax payable 3,918 1,365
Current portion of provisions - 1,740
Current portion of long-term debt 107,346 -
-----------------------
140,993 42,843
Long-term liabilities
Long-term debt - 128,622
-----------------------
Total Liabilities 140,993 171,465
-----------------------
Shareholders' equity
Share capital 331,083 330,964
Share option reserve 17,910 14,803
Accumulated deficit (80,831) (12,487)
Foreign currency translation reserve 103,071 43,213
-----------------------
Total Shareholders' Equity 371,233 376,493
-----------------------
Total Liabilities and Shareholders' Equity 512,226 547,958
-----------------------
-----------------------
Xtreme Drilling and Coil Services Corp.
Consolidated Statements of (Loss) Income
For the years ended December 31, 2015 and 2014
(in thousands of Canadian dollars, except share and per share data)
(unaudited)
2015 2014
----------------------
----------------------
Revenue 221,359 267,441
----------------------
Expenses
Operating expenses 141,211 174,201
General and administrative expenses 18,996 16,268
Depreciation and impairment of property and
equipment 97,832 56,158
Amortization of intangibles 303 304
Stock-based compensation 3,131 3,053
Foreign exchange loss 2,205 262
Loss on disposal of equipment 667 4,399
Other (income) expense (1) 21
Interest expense 4,502 4,572
----------------------
(Loss) income before tax for the year (47,487) 8,203
Tax expense
Current 7,054 6,752
Deferred 13,803 862
----------------------
Total tax expense 20,857 7,614
----------------------
Net (loss) income for the year (68,344) 589
----------------------
----------------------
Net (loss) income per common share
- basic (0.84) 0.01
- diluted (0.84) 0.01
Weighted average number of
common shares
- basic 81,814,143 81,575,887
- diluted 81,814,143 82,347,343
Xtreme Drilling and Coil Services Corp.
Consolidated Statements of Comprehensive (Loss) Income
For the years ended December 31, 2015 and 2014
(in thousands of Canadian dollars)
(unaudited)
2015 2014
-----------------------
-----------------------
Net (loss) income for the year (68,344) 589
Other comprehensive income
Items may be subsequently reclassified to profit or
loss
Unrealized gain on translating
financial statements of foreign operations 59,858 28,070
Dividends declared to non-controlling interest
partner - (1,332)
-----------------------
Comprehensive (loss) income for the year (8,486) 27,327
-----------------------
-----------------------
Xtreme Drilling and Coil Services Corp.
Consolidated Statements of Changes in Equity
For the years ended December 31, 2015 and 2014
(in thousands of Canadian dollars)
(unaudited)
Equity attributable to the owners of the parent
-------------------------------------------------
Foreign
Share currency
Share option Accumulated translation
capital reserve deficit reserve
-------------------------------------------------
-------------------------------------------------
Balance at Jan 1, 2014 328,416 12,419 (12,697) 15,143
-------------------------------------------------
-------------------------------------------------
Net income for the year - - 589 -
Other comprehensive income
Currency translation
differences - - - 28,070
Dividends declared - - - -
Settlement of purchase - - (379) -
-------------------------------------------------
Total comprehensive income - - 210 28,070
-------------------------------------------------
Employee share option
scheme:
Value of employees
services - 3,068 - -
Transfer from share option 684 (684) - -
Proceeds from shares
issued 1,864 - - -
-------------------------------------------------
Total transactions with
owners 2,548 2,384 - -
-------------------------------------------------
Balance at Dec 31, 2014 330,964 14,803 (12,487) 43,213
-------------------------------------------------
-------------------------------------------------
Balance at Jan 1, 2015 330,964 14,803 (12,487) 43,213
-------------------------------------------------
-------------------------------------------------
Net loss for the year - - (68,344) -
Other comprehensive income
Currency translation
differences - - - 59,858
-------------------------------------------------
Total comprehensive loss - - (68,344) 59,858
-------------------------------------------------
Employee share option
scheme:
Value of employee services - 3,140 - -
Transfer from share option 33 (33) - -
Proceeds from shares
issued 86 - - -
-------------------------------------------------
Total transactions with
owners 119 3,107 - -
-------------------------------------------------
Balance at Dec 31, 2015 331,083 17,910 (80,831) 103,071
-------------------------------------------------
-------------------------------------------------
Equity
attributable
to the
owners of
the parent
-------------
Non- Total
controlling shareholder
Total interest s' equity
---------------------------------------
---------------------------------------
Balance at Jan 1, 2014 343,281 953 344,234
---------------------------------------
---------------------------------------
Net income for the year 589 - 589
Other comprehensive income
Currency translation
differences 28,070 - 28,070
Dividends declared - (1,332) (1,332)
Settlement of purchase (379) 379 -
---------------------------------------
Total comprehensive income 28,220 (953) 27,327
---------------------------------------
Employee share option
scheme:
Value of employees
services 3,068 - 3,068
Transfer from share option - - -
Proceeds from shares
issued 1,864 - 1,864
---------------------------------------
Total transactions with
owners 4,932 - 4,932
---------------------------------------
Balance at Dec 31, 2014 376,493 - 376,493
---------------------------------------
---------------------------------------
Balance at Jan 1, 2015 376,493 - 376,493
---------------------------------------
---------------------------------------
Net loss for the year (68,344) - (68,344)
Other comprehensive income
Currency translation
differences 59,858 - 59,858
---------------------------------------
Total comprehensive loss (8,486) - (8,486)
---------------------------------------
Employee share option
scheme:
Value of employee services 3,140 - 3,140
Transfer from share option - - -
Proceeds from shares
issued 86 - 78
---------------------------------------
Total transactions with
owners 3,226 - 3,226
---------------------------------------
Balance at Dec 31, 2015 371,233 - 371,233
---------------------------------------
---------------------------------------
Xtreme Drilling and Coil Services Corp.
Consolidated Statements of Cash Flows
For the years ended December 31, 2015 and 2014
(in thousands of Canadian dollars)
(unaudited)
2015 2014
-----------------------
-----------------------
Cash flow provided by:
Operating activities
Net (loss) income for the year (68,344) 589
Items not affecting cash:
Depreciation, impairment, and amortization 98,135 56,462
Stock-based compensation 3,131 3,053
Unrealized foreign exchange loss 2,205 262
Loss on disposal of equipment 667 4,399
Provisions for doubtful accounts (997) (110)
Interest expense 4,502 4,572
Interest paid (4,704) (3,586)
Amortization of debt issuance costs 537 458
Current tax expense 7,054 6,752
Deferred tax expense 13,803 862
Taxes paid (11,608) (4,749)
Changes in items of working capital 11,491 15,889
-----------------------
Net cash generated from operating activities 55,872 84,853
-----------------------
Financing activities
Proceeds from exercise of stock options 86 1,864
Proceeds from long-term debt 6,579 6,961
Repayment of long-term debt (51,465) (18,647)
Debt issuance cost - (125)
-----------------------
Net cash used in financing activities (44,800) (9,947)
-----------------------
Investing activities
Proceeds from sale of equipment 431 1,242
Capital expenditures (19,987) (65,255)
Buyout of non-controlling interest partner (1,962) (13,263)
Changes in items of working capital relating to
capital items (6,463) 6,175
-----------------------
Net cash used in investing activities (27,981) (71,101)
-----------------------
Effect of exchange rate changes on cash and cash
equivalents 15,030 (2,923)
-----------------------
(Decrease) increase in cash and cash equivalents (1,879) 882
Cash and cash equivalents - beginning of year 13,102 12,220
-----------------------
Cash and cash equivalents - end of year 11,223 13,102
-----------------------
Xtreme Drilling and Coil Services Corp.
EBITDA and Adjusted EBITDA
For the years ended December 31, 2015 and 2014
(in thousands of Canadian dollars)
(unaudited)
2015 2014
----------------------------------------------------------------------------
Net (loss) income (68,344) 589
Tax expense 20,857 7,614
Interest expense 4,502 4,572
Amortization of intangibles 303 304
Depreciation and impairment 97,832 56,158
----------------------------------------------------------------------------
EBITDA 55,150 69,237
----------------------------------------------------------------------------
----------------------------------------------------------------------------
2015 2014
----------------------------------------------------------------------------
EBITDA 55,150 69,237
Adjustments for non-cash items 6,002 7,735
----------------------------------------------------------------------------
Adjusted EBITDA 61,152 76,972
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Adjusted EBITDA per share ($) 0.75 0.97
Net (loss) income per share ($) (0.84) 0.07
2015 2014
----------------------------------------------------------------------------
Stock-based compensation 3,131 3,053
Loss on disposal of equipment 667 4,399
Foreign exchange loss 2,205 262
Other (income) expense (1) 21
----------------------------------------------------------------------------
Total adjustments for non-cash items 6,002 7,735
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Reader Advisory
This news release contains forward-looking statements ("FLS"). The use of the words "may", "believe", "could", "would", "might", "will be taken", "occur" or "be achieved" and similar expressions identify FLS. More particularly, this news release contains statements that may relate to contracting, marketing, financing, construction, modifications, deployment, operation, utilization of drilling rigs in the Company's current and future fleet. Although Xtreme believes expectations reflected in these FLS are reasonable, readers should not place undue reliance on them because Xtreme can give no assurance they will prove to be correct. There are many factors that could cause FLS not to be correct, including risks and uncertainties inherent in the Company's business.
These statements are based on certain factors and assumptions including, but not limited to: the assessment of current and projected future operations; ongoing and future strategic business alliances, negotiations and opportunities to enter new, extend or complete existing contracts; the availability and cost of financing; foreign currency exchange rates; timing and magnitude of capital expenditures; expenses and other variables affecting rig operation, modification and construction; the ability and commitment of vendors to provide rig component equipment, services and supplies, including labor, in a cost-effective and timely manner; the issuance of applied-for patents; changes in tax rates; and government regulations. Although Xtreme considers the assumptions used to prepare this news release reasonable, based on information available to management as of March 10, 2016, ultimately the assumptions may prove to be incorrect.
Forward-looking statements are also subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially from management's current expectations. These factors include, but are not limited to: the cyclical nature of drilling market demand, foreign currency exchange rates, and commodity prices; access to credit and to equity markets; the availability of qualified personnel; vendor-provided rig components; and, competition for customers.
Management's assumptions considered the following: compliance with the terms of the Company's current and proposed new credit facility; ongoing access to key supplies and components required to continue operating and maintaining equipment, including fuel; continued successful performance of drilling and related equipment; expectations regarding gross margin; recruitment and retention of qualified personnel; continuation or extension of existing long-term or multi-well contracts; revenue expectations related to shorter-term drilling opportunities; willingness and ability of customers to remit amounts owing to Xtreme in accordance with normal industry practices; and management of accounts receivable in direct relation to revenue generation.
In preparing this news release, management considered the following risk factors: fluctuations in crude oil and natural gas prices, supply and demand; fluctuation in foreign currency exchange and interest rates; financial stability of Xtreme's customers; current and future applications for Xtreme's proprietary technology; competition from other drilling contractors; regulatory and economic conditions in regions where Xtreme operates; environmental constraints; changes to government legislation; international trade barriers or restrictions; and, where appropriate, global political and military events.
Financial outlook information contained in this news release about prospective results of operations, financial position or cash provided by operating activities is based on assumptions about future events, including economic conditions and proposed courses of action, and on management's assessment of relevant information currently available. Readers are cautioned such financial outlook information contained in this news release is not appropriate for purposes other than for which it is disclosed here. Readers should not place undue importance on FLS and should not rely on this information as of any other date. Except as required pursuant to applicable securities laws, Xtreme disclaims any intention, and assumes no obligation, to update publicly or revise FLS to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such FLS or otherwise, or to explain any material difference between subsequent actual events and such FLS.
About Xtreme
Xtreme Drilling and Coil Services Corp. ("XDC" on the Toronto Stock Exchange) designs, builds, and operates a fleet of high specification drilling rigs and coiled tubing well service units featuring leading-edge proprietary technology including AC high capacity coil injectors, deep re-entry drilling capability, modular transportation systems and continuous integration of in-house advances in methodologies.
Currently Xtreme operates two service lines: Drilling Services (XDR) and Coil Services (XSR) under contracts with oil and natural gas exploration and production companies and integrated oilfield service providers in
Canada
,
the United States
, and
Saudi Arabia
. For more information about the Company, please visit
www.xtremecoil.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Xtreme Drilling and Coil Services Corp.
Matt Porter
President and Chief Financial Officer
+1 281 994 4600
ir@xtremecoil.com
www.xtremecoil.com
Source: Xtreme Drilling and Coil Services
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