🕐10.04.12 - 19:27 Uhr
ENERGOLD ANNOUNCES 2011 YEAR END RESULTS AND RECORD REVENUES AND EARNINGS
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Re: News Release - Tuesday, April 10, 2012
Energold Announces 2011 Year End Results and Record Revenues and
Earnings
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Energold Drilling Corp.
(EGD: TSX.V) ("Energold" or "the Company") is
pleased to announce its results for the year ended December 31, 2011.
Revenues were a Company record of $133.5 million on a record annual
high of 585,900 meters of mineral drilling, up 145% from revenues of
$54.6 million, 69% on 346,300 meters of drilling in 2010.
Revenues
totalled $35.30 million in the fourth quarter, historically the slowest
quarter, up 105% from $17.3 million in the last quarter of 2010, and
meters drilled in minerals increased 30% to 134,500 meters in the
fourth quarter from 103,400 meters in the comparative quarter of 2010.
Overall, 2011 meters drilled in minerals increased significantly by 69%
over the annual 2010 figures.
The energy division drilled a further
444,400 meters in 2011, while there was no comparative meters drilled
for energy in 2010.
Overall, demand for drilling activity increased
significantly in 2011 and based on macroeconomic trends will continue
beyond 2012.
Net earnings were a record $26.4 million compared to the 2010 net
earnings figures of $1.6 million as a result of a very successful year
of operations and the net impact of accounting for the Bertram
transaction.
The July 25th 2011, acquisition of Bertram had a significant impact
upon the consolidated statements of financial position and
comprehensive income for the year ended December 31st 2011.
The
acquired property, plant and equipment were written up by $23.8 million
to their fair market value and intangibles by $4.1 million.
The
difference between the assets and liabilities acquired and the
acquisition price resulted in a gain of approximately $15.0 million.
Based on this transaction the Company included to December 31st
amortization of intangibles, $0.4 million, additional depreciation of
property, plant and equipment, $1.1 million and $3.0 million related to
the earn out bonus.
The Company enters 2012 in excellent financial position with a strong
balance sheet and working capital position of $69.3 million and cash
equivalents of $22.8 million.
Subsequent to the year end the Company
completed a $20.3 million bought deal by a syndicate led by the Toronto
Dominion Bank.
The Companys balance sheet also does not reflect the
current market value of its equity investment in IMPACT Silver Corp.
(IPT:TSX-V).
The Companys 6.98 million shares in IMPACT Silver Corp.
is accounted for on an equity basis.
Based on closing market prices at
April 3 2012, the investment has a quoted market value of $11.4
million, amounting to $4.74 million more than its carrying value.
Year-End Results Comparison ($CAD 000s except per-share amounts and
meters drilled)
View Table:
http://www.energold.com/i/pdf/nr/2012-04-10_NR.pdf
144 KB in size, approx.
28 seconds to download at 56.6Kbps
The Companys strategy for 2011 and 2012 is to capitalize on
opportunities globally as demand increases for exploration for both
energy and minerals.
With the demand for drill rigs outpacing supply,
Energold was able to improve rig utilization rates and pricing.
The
Company also took the opportunity to diversifying our service offerings
venturing into manufacturing and sale of drill rigs, and the expansion
into drilling for energy related projects.
With revenue per meter
increasing and additional expenses being passed onto clients, average
margins increased to over 29% overall, a material increase from 2010s
average of 21%.
Quarterly Results Comparison (CAD 000s except rig fleet and meters
drilled)
View Table:
http://www.energold.com/i/pdf/nr/2012-04-10_NR.pdf
144 KB in size, approx.
28 seconds to download at 56.6Kbps
Senior and intermediate base metal and gold mining clients were
successful in raising capital and generating earnings in 2011.
Juniors
also had a window of opportunity to re-establish their treasuries, with
the recovering market early in the year.
It is expected that with
greater amounts of cash and financial flexibility in project
selections, our clients will continue the demand for drilling services
in 2012.
Minerals Drilling
Revenues for the mineral division in the fourth quarter of 2011 were
$27.1 million, up 57% from $17.3 million in the fourth quarter of 2010.
For the year, the mineral division revenues totaled $105.8 million.
This compares to $54.6 million for the comparative period of 2010 or a
94% increase.
The combination of general price increases on drilling
projects, and an increase in higher priced frontier drilling activity
increased the average revenue per meter to $201 for the fourth quarter
2011 from $167 for the fourth quarter in 2010, and to $181 for the year
from $158 for the year 2010.
Gross margin percentage from mineral
drilling was up to 31.4% for 2011, compared to 21.4% in 2010.
As the
percentage of the Companys rigs move to the frontier areas continues
to increase, the Company expects to see further increasing average
prices and improving margins.
Mexico, Caribbean, and Central America remains our strongest market
with 43 rigs in the region.
South America has a similar number of rigs
operating in five countries.
Africa, especially West Africa remains one
of the fastest growing regions with over 39 rigs and at least 5 to be
added in the first part of 2012.
The Company is just starting to penetrate the Asian market.
It
currently has 2 rigs in the region and is anticipating adding at least
2 to 3 more rigs in the immediate future.
Its S rigs are particularly
suitable in parts of Asia where there are low labour costs and a lack
of infrastructure.
Energold remains dedicated to continual research and innovation of our
industry leading frontier portable and modular S-Style Series II and
III rigs, with modification and upgrade programs to increase its
capabilities and performance.
With frontier programs transitioning to
developing mine sites there is an additional requirement for more
conventional equipment.
The mineral fleet now includes underground
rigs, larger diamond coring rigs, RC rigs and multi-purpose rigs.
At
year ending December 31 2011, the Company had a total of 125 mineral
rigs and continues to expand its rig fleet with a target of an
additional 20 to 30 rigs by year-end 2012.
Energy Drilling
The Energy division was very active during the traditionally slower
summer/fall season, completing over 29,700 holes and a total of 444,400
meters from the date of acquisition to December 31, 2011, of which
10,700 holes and a total of 214,800 meters occurred in the fourth
quarter, levels not experienced since 2006.
Bertram had total revenues
of $3.8 million and margins of 16.1% during the fourth quarter,
normally the slowest quarters for actual drilling activity, even as the
company incurs mobilization costs for the winter oil sands coring
season for number of international oil and gas clients.
Year to date
revenues were $13.5 million and the gross margin was 18.4%.
It is
anticipated that, a significant portion of Bertrams 15 coring rigs
will be employed in the first quarter of 2012.
The energy division will
redeploy some of the energy rigs to optimize the Bertram fleet
utilization, including the possibility of mobilizing some of Bertrams
seismic rigs to markets where demand is higher than its traditional
markets.
Manufacturing
The manufacturing division continued to grow and thrive during the
final quarter of the 2011 with revenues of $4.4 million and net income
of $0.3 million.
By the year end, expanded sales and new contracts
resulted in total sales for the year of $14.2 million and a net profit
of $0.1 million.
The division is on track to achieve a substantial
increase in revenue and profit going forward, with strong demand for
rigs and equipment (non arms length) resulting in a confirmed order
book of 5.7 million GBP and strong inquiries of 10.0 to 20.0 million
GBPs heading into 2012.
This new division will also provide a source
of additional rigs to broaden Energolds scope of services to selected
customers in appropriate geographic regions; capitalize on Energolds
existing relationships to build larger rigs for clients; engineer rig
improvements, and build separate water well drilling services division
for Energold.
Overall 2011 was a transformative and prolific year for the Company,
headlined with record revenue, profits, and expansions into new
business segments.
The industry has taken notice and Energold received
several accolades as a result of its record breaking growth and
adherence to the strict upmost respect for the social and environmental
aspects in mineral exploration.
Amongst the list of awards Energold has
been recognized for in 2011 are Profits 200, BC Magazines Fastest
Growing Companies, Business in Vancouvers Fastest Growing Companies,
TSX Venture Top 50 Companies, TSX Pick of the Street Award, and our
most valuable achievement, the continual commitment from our
shareholders.
Looking forward to the 2012 and beyond, with new rigs and additional
contracts across the globe, the Company has strategically positioned
itself for future growth globally into one of the larger drilling
companies in the world.
The Company will be reviewing its 2011 Year-End results via Conference
Call at 4:15 pm ET, 1:15 pm PT, Wednesday April 11th.
The dial-in
numbers are 1-866-782-8903 or 647-426-1845.
Management will be
discussing the Companys financial and operational results ending with
a question-and-answer period.
Investors are encouraged to forward any
questions they may have to .
The recorded audio file
can be accessed at our website: http://www.energold.com/s/Events.asp
Energold Drilling Corp.
is a global leader in an environmentally and
socially-sensitive diamond drilling company that services the mining,
energy, and manufacturing sector.
Energold holds 6.98 million shares
of IMPACT Silver Corp.
On behalf of the Directors of Energold Drilling Corp.
"Frederick W.
Davidson"
President, CEO
For further information, please contact:
Jerry Huang - Manager, Investor Relations
(604) 681 9501 or via email at
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, the price of commodities, changing foreign
exchange rates, actions by government authorities, 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.
IMPACT does not assume the obligation to update any
forward-looking statement.
View News Release:
http://www.energold.com/i/pdf/nr/2012-04-10_NR.pdf
144 KB in size, approx.
28 seconds to download at 56.6Kbps
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Copyright (c) 2012 ENERGOLD DRILLING CORP.
(EGD) All rights reserved.
For more information visit our website at http://www.energold.com/ or
send mailto:
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