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Macro Enterprises Inc. Announces 2013 Fourth Quarter and Year End Results

FORT ST. JOHN, BRITISH COLUMBIA -- (Marketwired) -- 03/12/14 -- Macro Enterprises Inc. (TSX VENTURE: MCR) -

                                     Summary of financial results
                            (thousands of dollars except per share amounts)
                              Three months ended          Year ended
                                  December 31             December 31
                                   2013        2012        2013        2012

Revenues                        $54,386     $43,827    $211,846    $148,314

EBITDA1                           8,625       7,576      47,743      30,626

Net income                        6,670       5,643      31,285      19,345

Net income per share              $0.22       $0.23       $1.13       $0.79

Weighted average common
 shares outstanding
 (thousands)                                             27,464      23,882


--  Revenues increased from the fourth quarter last year due in part to
    revenues from the new business acquired in November 2012

--  EBITDA and net income were above the fourth quarter of last year due to
    increased activity

Note 1 - References to EBITDA are to net income from continuing operations before interest, taxes, amortization and impairment charge. EBITDA is not an earnings measure recognized by International Financial Reporting Standards ("IFRS") and does not have a standardized meaning prescribed by IFRS. Management believes that EBITDA is an appropriate measure in evaluating the Company's performance. Readers are cautioned that EBITDA should not be construed as an alternative to net income (as determined under IFRS) as an indicator of financial performance or to cash flow from operating activities (as determined under IFRS) as a measure of liquidity and cash flow. The Company's method of calculating EBITDA may differ from the methods used by other issuers and, accordingly, the Company's EBITDA may not be comparable to similar measures used by other issuers.

Fourth quarter results

Consolidated revenue was $54.4 million compared to $43.8 million in the fourth quarter last year. During the fourth quarter this year, the Company was active in two pipeline construction projects in the Fort McMurray area. The Company was also involved in pipeline integrity work for two customers and performed some pipeline repair work. Lastly, the Company performed some smaller facility work for several customers. Last year, the Company was involved in pipeline integrity work for several customers and obtained additional revenue from pipeline construction and facility work for two customers.

Operating expenses were 80.2% of revenue in the quarter compared to 77.3% in the same quarter last year. Operating expenses were relatively higher this quarter compared to the previous three quarters due to somewhat lower bid margins in the current quarter.

Amortization of property, plant and equipment was $2.2 million compared to $1.4 million in the prior period reflecting a higher level of fixed assets in the current year. This is due principally to the acquisition of pipeline construction equipment and related assets from North American Energy partners completed in the fourth quarter of last year (the "NAEP acquisition"). Last year, the Company recorded $1.7 million of amortization of the value attributed to a customer contract. This charge completely amortized this asset as the benefit of this asset was obtained during the fourth quarter of last year.

General and administrative expenses were $2.2 million, down marginally from the $2.3 million recorded last year. However, last year's costs included $0.5 million related to one-time acquisition costs on the NAEP acquisition. Expenses were up this year due to the greater level of activity throughout the year.

Finance costs of $0.2 million were approximately the same as last year.

Last year, the Company recorded a one-time non-cash gain of $2.2 million related to the NAEP acquisition. This gain arose because the value of the assets obtained in this acquisition exceeded the purchase price.

Income taxes recovered in the quarter were $0.5 million. This recovery arose due to the effect of a change in estimate in the current quarter which resulted in a reduction in tax expense of $2.3 million ($0.08 per share). Excluding this change in estimate, income tax expense would have been $1.8 million which would have equated to an effective tax rate of 29.1% which is in excess of statutory rates in the quarter. This was due to adjusting the year end tax rate to reflect the jurisdictions in which the company operated in the year. Last year, the effective tax rate in the quarter was 12.2% as the inclusion of the gain from business combination was not subject to tax.

In the fourth quarter of last year, the Company recorded $1.7 million of amortization of customer contracts and a $2.2 million gain, both related to the NAEP acquisition. The Company also recorded a reduction in income tax expense of $0.5 million related to the NAEP acquisition. The net impact of these three items was to increase earnings per share in the fourth quarter of last year by $0.04.

Net income in the quarter was $6.7 million ($0.22 per share) compared to $5.6 million ($0.23 per share).


The Company continues to be active throughout British Columbia, Alberta, Saskatchewan and Manitoba, in particular in the Fort McMurray region of Alberta carrying out pipeline and facility construction and performing pipeline integrity work. The Company is also actively pursuing new opportunities, including those related to possible LNG projects and related infrastructure.

The Company is expecting revenues in the first quarter of 2014 to be above those recorded in the first quarter of 2013, mainly due to pipeline construction and integrity work in the Fort McMurray area and increased pipeline integrity work in Saskatchewan and Manitoba. The Company does not expect to duplicate the margins experienced by the Company in the first quarter of 2013.

Conference call

The Company will host a conference call at 8 am PDT on Thursday, March 13, 2014 to discuss the 2013 fourth quarter and year end results. The conference call can be accessed by dialing 1-888-390-0605 and referencing conference ID 26685807.

Macro's core business is providing pipeline and facilities construction and maintenance services to major companies in the oil and gas industry. The Company is based in Fort St. John, B.C. and has a corporate office in Calgary, Alberta. Its shares are listed on the TSX Venture Exchange under the symbol MCR. Information on the Company's principal operating unit, Macro Industries Inc., can be found at www.macroindustries.ca.

Forward Looking Statements

Certain statements in this news release may include forward-looking information that involves various risks and uncertainties. These may include, without limitation, statements regarding expected revenues, expenses and industry trends and the pursuit of strategic acquisitions. These risks and uncertainties include, but are not restricted to, global economic conditions, government regulation of energy and resource companies, seasonal weather patterns, maintaining and increasing market share, terrorist activity, the price and availability of alternative fuels, the availability of pipeline capacity, and potential instability or armed conflict in oil producing regions. These risks and uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such forward-looking statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These statements are based on the estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, the Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

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.

Macro Enterprises Inc.
Frank Miles
President and C.E.O.
(250) 785-0033

Macro Enterprises Inc.
T. Jerrold Jackson
(403) 705-7302

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