Welcome!

News Feed Item

Entrec Corporation Approves 2014 Capital Expenditure Program and Appoints John M. Stevens President & CEO

SPRUCE GROVE, ALBERTA -- (Marketwired) -- 01/15/14 -- ENTREC Corporation ("ENTREC" or the "Company") (TSX VENTURE:ENT), a leading provider of heavy lift and heavy haul services, today approved a $46 million capital expenditure program for 2014. The program consists of growth capital expenditures of $34 million and $12 million in maintenance capital expenditures. ENTREC is also pleased to announce the appointment of Mr. John M. Stevens as its President and CEO. Mr. Stevens previously served as President and COO and will now replace Rod Marlin as CEO who has transitioned to the role of Executive Chairman.

"This is a very natural transition for ENTREC," said Rod Marlin, ENTREC's Executive Chairman. "In John's previous role, he led our Company through a transformational period of growth and is well deserving of his new responsibilities as Chief Executive to take our Company to the next level."

2014 Capital Expenditure Program

"Our 2014 growth capital expenditures will be specifically focused on growing our mobile crane capabilities," said Mr. Stevens. "We believe continued investment in this area will increase our access to the recurring onsite maintenance, repair and operation ("MRO") support work in the Alberta oil sands region, as well as to the significant industrial construction work occurring in both the oil sands and in Northwest BC.

ENTREC's 2014 capital expenditure program consists of the following components:

Growth capital expenditures - cranes                         $    27 million
Growth capital expenditures - heavy haul transportation            5 million
Other growth capital expenditures                                  2 million
Maintenance capital expenditures                                  12 million
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Total                                                             46 million

Included in ENTREC's 2014 growth capital expenditures are the purchase of $6.5 million of crane rental units. These units carry favourable purchase options, which allow the Company to apply much of its previous rental payments against the purchase price. ENTREC's maintenance capital expenditures reflect its capital maintenance program. The program is designed to keep the Company's fleet efficient and profitable by replacing an equipment item when it becomes cost-prohibitive to operate due to high maintenance and operating costs.

ENTREC intends to fund its 2014 capital expenditure program from its credit facilities, finance leases and cash from operating activities. The Company also expects to have the flexibility to increase its capital expenditure program throughout 2014 should customer demand warrant. The Company does not believe it will need to raise any additional equity to fund its 2014 capital expenditure program.

2013 Capital Expenditures

During the year ended December 31, 2013, ENTREC expects to report capital expenditures of approximately $59 million (subject to final year-end adjustments), consisting of $53 million in growth capital expenditures and $6 million in maintenance capital expenditures. Crane equipment purchases accounted for approximately $36 million of the capital expenditures, with the remainder directed to tractors and heavy haul trailers, as well as to other support equipment. At December 31, 2013, ENTREC's total net debt was approximately $131 million (subject to final year-end adjustments).

2014 Revenue Guidance

Based on current expectations for future business activity, and assuming no business acquisitions are completed, ENTREC estimates revenue for the year ending December 31, 2014 could range between $250 and $270 million. This compares to estimated revenue of approximately $213 million for the year ended December 31, 2013. ENTREC expects revenue levels to trend upward throughout 2014 as project work begins to ramp up and utilization levels increase. Any business acquisitions completed in fiscal 2014 could increase this revenue estimate. ENTREC's 2013 revenue results remain subject to final year-end billing and accounting adjustments, and as a result, may be different from current expectations.

"Our outlook for 2014 and 2015 remains very positive," said Mr. Stevens. "Despite the lower demand levels we have seen in recent months, quoting activity in our key markets continues to be strong for work commencing in 2014."

ENTREC estimates its overall adjusted EBITDA margin for fiscal 2014 could approximate 25%. Consistent with the upward trend in revenue, ENTREC believes its adjusted EBITDA margin will also increase as the year progresses.

Oil sands demand is expected to ramp up beginning in the first quarter of 2014 and continue to gain momentum as the year progresses. Large heavy haul transportation contracts awarded to ENTREC in the first half of 2013 should commence in the first and second quarters of 2014 and continue through 2017. In addition, ENTREC is working with oil sands customers on several large crane and heavy haul transportation projects that will commence at different times throughout the 2014 year. Certain of these projects will extend through to 2017.

Consistent with its strategy, ENTREC is also successfully expanding the amount of long-term maintenance, repair and operation (MRO) contract work it performs in the Alberta oil sands region. ENTREC was recently awarded a 5-year MRO contract with an oil sands customer, which commenced in December 2013 and could generate up to $15 million in annual revenue.

Northwest B.C. continues to be a busy area for ENTREC. The Company is currently working on various mining, hydro-electric, pipeline, and oil and natural gas projects in the region and is providing crane and transportation services to support a multi-billion-dollar revitalization of an aluminum smelter in Kitimat, B.C. ENTREC will continue to expand its service capabilities in this important region throughout 2014 in preparation for the planned development of LNG facilities and is currently in the process of expanding its operations into Prince Rupert, B.C. These projects, along with ancillary infrastructure developments, are expected to require extensive crane and heavy haul transportation services.

With the acquisition of GT's Crane and Transportation Services Inc. in 2013, ENTREC now has a leading market position in northeast B.C. and northwest Alberta. ENTREC believes this will be a busy area for the Company in 2014 as it supports oil and natural gas projects in the region. The Company has also recently expanded its operations into Fort St. John, B.C. to better serve customers in this region.

About ENTREC

ENTREC is a leading provider of heavy lift and heavy haul services with offerings encompassing crane services, heavy haul transportation, engineering, logistics and support. ENTREC provides these services to the oil and natural gas, construction, petrochemical, mining and power generation industries. ENTREC's common shares trade on the TSX Venture Exchange under the trading symbol "ENT".

Non-IFRS Financial Measures

Adjusted EBITDA is defined as earnings before interest, income taxes, depreciation, amortization, loss (gain) on disposal of property, plant and equipment, change in fair value of embedded derivative, share-based compensation, and non-recurring business acquisition and integration costs. In addition to net income, adjusted EBITDA is a useful measure as it provides an indication of the financial results generated by ENTREC's principal business activities prior to consideration of how these activities are financed or how the results are taxed in various jurisdictions and before certain non-cash expenses. Adjusted EBITDA also illustrates what ENTREC's EBITDA is, excluding the effect of non-recurring business acquisition and integration costs. Adjusted EBITDA margin is calculated as adjusted EBITDA divided by revenue.

Forward-looking Statements

This press release contains forward-looking statements which reflect ENTREC's current beliefs and are based on information currently available to ENTREC. These statements require ENTREC to make assumptions it believes are reasonable and are subject to inherent risks and uncertainties. Actual results and developments may differ materially from the results and developments discussed in the forward-looking statements as certain of these risks and uncertainties are beyond ENTREC's control.

Examples of such forward-looking statements in this press release relate to, but are not limited to: ENTREC's plan to execute a 2014 capital expenditure program of $46 million; expectation that ENTREC's 2014 capital expenditure program will be funded from its credit facilities, finance leases and cash from operating activities and that it will have the flexibility to increase its 2014 capital expenditure program throughout 2014 should customer demand warrant; belief the Company will not need to raise any additional equity to fund its 2014 capital expenditure program; expectation the Company will incur capital expenditures of approximately $59 million in 2013 and exit 2013 with total net debt of approximately $131 million; estimate revenue could range between $250 million and $270 million for the year ending December 31, 2014; estimate 2013 revenue will approximate $213 million, subject to final year-end billing and accounting adjustments; expectation revenue levels will trend upward throughout 2014 as project work begins to ramp up and utilization levels increase; expectation that oil sands demand will begin ramping up in the first and second quarters of 2014 and continue to gain momentum as the year progresses; estimate a recently awarded MRO contract, which commenced in December 2013, could generate up to $15 million in incremental annual revenue; belief ENTREC will continue to expand its service capabilities in northwest B.C. in 2014 as it anticipates the planned development of LNG facilities; belief northwest Alberta and northeast B.C. will be a busy area for ENTREC in 2014 as it supports oil and natural gas projects in the region; and estimate ENTREC's overall adjusted EBITDA margin for fiscal 2014 could approximate 25% and increase as the year progresses.

ENTREC's forward-looking statements involve a number of significant assumptions. Key assumptions utilized in developing forward-looking statements related to ENTREC's growth, revenue, and adjusted EBITDA margin expectations include achieving its internal revenue, net income and cash flow forecasts for 2014. Key assumptions involved in preparing ENTREC's internal forecasts include, but are not limited to, its expectations and estimates that: demand for crane and heavy haul transportation services in western Canada increases from current levels in 2014; ENTREC will be able to retain key personnel and attract additional high-quality personnel to support its planned revenue growth; construction projects and production activity in the Alberta oil sands region and in northern British Columbia continue at or above current levels; ENTREC is able to achieve anticipated revenues on current and future MRO contracts; the planned development of LNG facilities proceeds and certain customers choose to utilize ENTREC's services; there are no significant unplanned increases in ENTREC's cost structure, including those costs related to fuel and wages; market interest rates remain similar to current rates and that additional debt financing remains available to ENTREC on similar terms to its existing debt financing; there is no prolonged period of inclement weather that impedes or delays the need for crane and heavy haul transportation services; the competitive landscape in western Canada for crane and heavy haul transportation services does not materially change in 2014; and there is no material adverse change in overall economic conditions.

Achieving these forecasts largely depends on a number of factors beyond ENTREC's control including several of the risks discussed further under "Business Risks" in ENTREC Management's Discussion & Analysis for the three and nine months ended September 30, 2013. The business risks that are most likely to affect ENTREC's ability to achieve its internal revenue, net income and cash flow forecasts for 2014 are the volatility of the oil and gas industry, its exposure to the Alberta oil sands, workforce availability, weather and seasonality, availability of debt and equity financing, competition, and business integration risks. These risk factors are interdependent and the impact of any one risk or uncertainty on a particular forward-looking statement is not determinable.

ENTREC's ability to finance its capital expenditure program through its debt facilities depends on its ability to achieve debt financing terms acceptable to the lenders and ENTREC as well as meeting its internal cash flow forecasts.

Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, ENTREC. These forward-looking statements are made as of the date of this press release. Except as required by applicable securities legislation, ENTREC assumes no obligation to update publicly or revise any forward-looking statements to reflect subsequent information, events, or circumstances.

Neither the 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.

Contacts:
ENTREC Corporation
Rod Marlin
Executive Chairman
(780) 960-5647

ENTREC Corporation
John M. Stevens
President & CEO
(780) 960-5625

ENTREC Corporation
Jason Vandenberg
CFO
(780) 960-5630
www.entrec.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
With more than 30 Kubernetes solutions in the marketplace, it's tempting to think Kubernetes and the vendor ecosystem has solved the problem of operationalizing containers at scale or of automatically managing the elasticity of the underlying infrastructure that these solutions need to be truly scalable. Far from it. There are at least six major pain points that companies experience when they try to deploy and run Kubernetes in their complex environments. In this presentation, the speaker will d...
While DevOps most critically and famously fosters collaboration, communication, and integration through cultural change, culture is more of an output than an input. In order to actively drive cultural evolution, organizations must make substantial organizational and process changes, and adopt new technologies, to encourage a DevOps culture. Moderated by Andi Mann, panelists discussed how to balance these three pillars of DevOps, where to focus attention (and resources), where organizations might...
The deluge of IoT sensor data collected from connected devices and the powerful AI required to make that data actionable are giving rise to a hybrid ecosystem in which cloud, on-prem and edge processes become interweaved. Attendees will learn how emerging composable infrastructure solutions deliver the adaptive architecture needed to manage this new data reality. Machine learning algorithms can better anticipate data storms and automate resources to support surges, including fully scalable GPU-c...
When building large, cloud-based applications that operate at a high scale, it's important to maintain a high availability and resilience to failures. In order to do that, you must be tolerant of failures, even in light of failures in other areas of your application. "Fly two mistakes high" is an old adage in the radio control airplane hobby. It means, fly high enough so that if you make a mistake, you can continue flying with room to still make mistakes. In his session at 18th Cloud Expo, Le...
Machine learning has taken residence at our cities' cores and now we can finally have "smart cities." Cities are a collection of buildings made to provide the structure and safety necessary for people to function, create and survive. Buildings are a pool of ever-changing performance data from large automated systems such as heating and cooling to the people that live and work within them. Through machine learning, buildings can optimize performance, reduce costs, and improve occupant comfort by ...
As Cybric's Chief Technology Officer, Mike D. Kail is responsible for the strategic vision and technical direction of the platform. Prior to founding Cybric, Mike was Yahoo's CIO and SVP of Infrastructure, where he led the IT and Data Center functions for the company. He has more than 24 years of IT Operations experience with a focus on highly-scalable architectures.
CI/CD is conceptually straightforward, yet often technically intricate to implement since it requires time and opportunities to develop intimate understanding on not only DevOps processes and operations, but likely product integrations with multiple platforms. This session intends to bridge the gap by offering an intense learning experience while witnessing the processes and operations to build from zero to a simple, yet functional CI/CD pipeline integrated with Jenkins, Github, Docker and Azure...
The explosion of new web/cloud/IoT-based applications and the data they generate are transforming our world right before our eyes. In this rush to adopt these new technologies, organizations are often ignoring fundamental questions concerning who owns the data and failing to ask for permission to conduct invasive surveillance of their customers. Organizations that are not transparent about how their systems gather data telemetry without offering shared data ownership risk product rejection, regu...
René Bostic is the Technical VP of the IBM Cloud Unit in North America. Enjoying her career with IBM during the modern millennial technological era, she is an expert in cloud computing, DevOps and emerging cloud technologies such as Blockchain. Her strengths and core competencies include a proven record of accomplishments in consensus building at all levels to assess, plan, and implement enterprise and cloud computing solutions. René is a member of the Society of Women Engineers (SWE) and a m...
Dhiraj Sehgal works in Delphix's product and solution organization. His focus has been DevOps, DataOps, private cloud and datacenters customers, technologies and products. He has wealth of experience in cloud focused and virtualized technologies ranging from compute, networking to storage. He has spoken at Cloud Expo for last 3 years now in New York and Santa Clara.
Enterprises are striving to become digital businesses for differentiated innovation and customer-centricity. Traditionally, they focused on digitizing processes and paper workflow. To be a disruptor and compete against new players, they need to gain insight into business data and innovate at scale. Cloud and cognitive technologies can help them leverage hidden data in SAP/ERP systems to fuel their businesses to accelerate digital transformation success.
Containers and Kubernetes allow for code portability across on-premise VMs, bare metal, or multiple cloud provider environments. Yet, despite this portability promise, developers may include configuration and application definitions that constrain or even eliminate application portability. In this session we'll describe best practices for "configuration as code" in a Kubernetes environment. We will demonstrate how a properly constructed containerized app can be deployed to both Amazon and Azure ...
Poor data quality and analytics drive down business value. In fact, Gartner estimated that the average financial impact of poor data quality on organizations is $9.7 million per year. But bad data is much more than a cost center. By eroding trust in information, analytics and the business decisions based on these, it is a serious impediment to digital transformation.
Digital Transformation: Preparing Cloud & IoT Security for the Age of Artificial Intelligence. As automation and artificial intelligence (AI) power solution development and delivery, many businesses need to build backend cloud capabilities. Well-poised organizations, marketing smart devices with AI and BlockChain capabilities prepare to refine compliance and regulatory capabilities in 2018. Volumes of health, financial, technical and privacy data, along with tightening compliance requirements by...
Predicting the future has never been more challenging - not because of the lack of data but because of the flood of ungoverned and risk laden information. Microsoft states that 2.5 exabytes of data are created every day. Expectations and reliance on data are being pushed to the limits, as demands around hybrid options continue to grow.