Click here to close now.




















Welcome!

News Feed Item

Trican Well Service Ltd. Q1 2014 Update and Outlook

CALGARY, ALBERTA -- (Marketwired) -- 03/31/14 -- Trican Well Service Ltd. ("Trican", the "Company", "we" or "our") (TSX:TCW) anticipates that consolidated financial results for the first quarter of 2014 will be negatively impacted by pricing pressure and cost inflation in Canada and unfavorable weather conditions in the United States.

We estimate consolidated operating income(i) for the first quarter of 2014 to be between $30 million and $40 million. This estimate is subject to completion of our first quarter interim financial report, which we expect to release on May 7, 2014. Our Audit Committee has reviewed the financial outlook and information provided in this document.

Canadian Operations

We expect first quarter 2014 Canadian operating income to be up slightly compared to the fourth quarter of 2013 on higher revenue and activity levels, offset partially by lower operating margins. Canadian financial results for the first quarter of 2014 are expected to be negatively impacted by continued pricing pressure in the region. Equipment utilization has been very strong throughout the first quarter; however, lower pricing experienced at the end of the fourth quarter in 2013 has been carried throughout all of the first quarter of 2014. As a result, first quarter Canadian pricing is expected to be down slightly on a sequential basis.

Additionally, cost increases for fuel and third party hauling are expected to have a negative impact on first quarter Canadian operating margins. As a percentage of revenue, fuel and third party hauling expenses are consistent with the fourth quarter of 2013, but are up substantially compared to the first quarter of 2013. A weaker Canadian dollar, both sequentially and year-over-year, is also expected to have a negative impact on operating margins as a portion of our Canadian materials and operating costs are incurred in U.S. dollars.

Despite the disappointing first quarter results in Canada, our outlook for this region remains positive. Cash flows for our customers are expected to increase due to higher commodity prices combined with a strengthening U.S. dollar, which we expect will lead to higher year-over-year activity in the second half of 2014. With strong Canadian activity levels anticipated for the second half of 2014, we expect to implement a pricing increase in the second quarter that will be phased in for third quarter work programs. Rising costs combined with lower pricing have led to Canadian financial results that are below our return on capital targets and we believe that a price increase is needed and justified given the current operating environment in Canada.

US Operations

Weather related operational delays for our U.S. fracturing crews in the Marcellus, Oklahoma and Permian regions negatively impacted equipment utilization and financial results for January and February. Despite these delays, first quarter U.S. financial results are expected to increase sequentially due to utilization improvements across several of our U.S. regions; however, operating income, while improved relative to the fourth quarter of 2013, is still expected to be slightly negative. Activity and utilization for March has been strong for our U.S. operations and we believe this indicates improving fundamentals for this region. We have also seen operational improvements for our U.S. business during the first quarter that are positively impacting our U.S. equipment utilization. As a result, we expect to see sequential improvements in U.S. operating margins throughout 2014.

International Operations

Russia and Kazakhstan comprise the majority of our international results, and financial results for the first quarter of 2014 are projected to meet expectations. As expected, activity in Russia has been negatively impacted by cold weather throughout most of January and February; however, first quarter Russian financial results are expected to be consistent with the first quarter of 2013. In addition, first quarter international results are expected to be negatively impacted by start-up costs in Saudi Arabia and Colombia as we will not be completing our first jobs in these regions until early in the second quarter. We have been awarded contracts in these regions and will be looking to add additional contracts as the year progresses.

(i) Operating income is a measure that is not recognized under International Financial Reporting Standards (IFRS). Management of Trican believes that operating income is a useful supplemental measure. Operating income provides investors with an indication of earnings before depreciation, foreign exchange, other income (loss), taxes and interest. Investors should be cautioned that operating income should not be construed as an alternative to net income (loss) and cash flow from operations determined in accordance with IFRS as an indicator of Trican's performance. Trican's method of calculating operating income may differ from that of other companies and accordingly may not be comparable to measures used by other companies.

FORWARD-LOOKING INFORMATION

This document contains certain forward-looking information and financial outlook or future orientated financial information based on Trican's current expectations, estimates, projections and assumptions that were made by the Company in light of information available at the time the statement was made. Forward-looking information and financial outlook or future orientated financial information that address expectations or projections about the future, and other statements and information about the Company's strategy for growth, expected and future expenditures, costs, operating and financial results, future financing and capital activities are forward-looking statements. Some forward-looking information and financial outlook or future orientated financial information are identified by the use of terms and phrases such as "anticipate," "achieve", "achievable," "believe," "estimate," "expect," "intention", "plan", "planned", and other similar terms and phrases. This forward-looking information and financial outlook or future orientated financial information speak only as of the date of this document, other than the update in respect of our first quarter earnings per share and operating income that will be provided upon the release of our complete financial results for the first quarter of 2014, and we do not undertake to publicly update this forward-looking information and financial outlook or future orientated financial information except in accordance with applicable securities laws. This forward-looking information and financial outlook or future orientated financial information includes, among others:


--  The expectation that consolidated financial results for the first
    quarter of 2014 will be negatively impacted by pricing pressure and cost
    inflation in Canada and unfavorable weather conditions in the United
    States; 
--  The expectation that consolidated operating income for the first quarter
    of 2014 will be between $30 million and $40 million; 
--  The expectation that our first quarter interim financial report will be
    released on May 7, 2014; 
--  The expectation that first quarter 2014 Canadian operating income will
    be up slightly compared to the fourth quarter of 2013 on higher revenue
    and activity levels, offset partially by lower operating margins; 
--  The expectation that Canadian financial results for the first quarter of
    2014 will be negatively impacted by continued pricing pressure in the
    region; 
--  The expectation that first quarter Canadian pricing will be down
    slightly on a sequential basis; 
--  The expectation that cost increases for fuel and third party hauling
    will have a negative impact on first quarter Canadian operating margins;
--  The expectation that a weaker Canadian dollar, both sequentially and
    year-over-year, will have a negative impact on Canadian operating
    margins; 
--  The expectation that cash flows for our customers will increase due to
    higher commodity prices combined with a strengthening U.S. dollar; 
--  The expectation that higher cash flows for our Canadian customers will
    lead to higher year-over-year Canadian activity in the second half of
    2014; 
--  The expectation that we will implement a pricing increase in the second
    quarter that will be phased in for third quarter work programs; 
--  The belief that a price increase is needed and justified given the
    current operating environment in Canada; 
--  The expectation that, despite weather-related delays, first quarter U.S.
    financial results will increase sequentially due to utilization
    improvements across several of our U.S. regions; 
--  The expectation that U.S. operating income, while improved relative to
    the fourth quarter of 2013, will be slightly negative; 
--  The belief that strong activity and utilization for our U.S. operations
    in March indicates improving fundamentals for this region; 
--  The expectations that in U.S. operating margins will improve
    sequentially throughout 2014; 
--  The expectation that financial results for our Russian and Kazakhstan
    regions will meet expectations; 
--  The expectation that Russian financial results will be consistent with
    the first quarter of 2013; 
--  The expectation that first quarter international results will be
    negatively impacted by start-up costs in Saudi Arabia and Colombia as we
    will not be completing our first jobs in these regions until early in
    the second quarter; 
--  The intention to add contracts in Saudi Arabia and Colombia as the year
    progresses.  

Forward-looking information and financial outlook or future orientated financial information is based on current expectations, estimates, projections and assumptions, which we believe are reasonable but which may prove to be incorrect. Trican's actual results may differ materially from those expressed or implied and therefore such forward-looking information and financial outlook or future orientated financial information should not be unduly relied upon. In addition to other factors and assumptions which may be identified in this document, assumptions have been made regarding, among other things: industry activity; the general stability of the economic and political environment; effect of market conditions on demand for the Company's products and services; the ability to obtain qualified staff, equipment and services in a timely and cost efficient manner; the ability to operate its business in a safe, efficient and effective manner; the performance and characteristics of various business segments; the effect of current plans; the timing and costs of capital expenditures; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which the Company operates; and the ability of the Company to successfully market its products and services.

Forward-looking information and financial outlook or future orientated financial information is subject to a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks and uncertainties include: fluctuating prices for crude oil and natural gas; changes in drilling activity; general global economic, political and business conditions; weather conditions; regulatory changes; the successful exploitation and integration of technology; customer acceptance of technology; success in obtaining issued patents; the potential development of competing technologies by market competitors; and availability of products, qualified personnel, manufacturing capacity and raw materials. The foregoing important factors are not exhaustive. In addition, actual results could differ materially from those anticipated in forward-looking information and financial outlook or future orientated financial information provided herein as a result of the risk factors set forth under the section entitled "Risks Factors" in our Annual Information Form dated March 21, 2014. Readers are also referred to the risk factors and assumptions described in other documents filed by the Company from time to time with securities regulatory authorities.

Any financial outlook or future oriented financial information in this document, as defined by applicable securities legislation, has been approved by management. Such financial outlook or future oriented financial information is based on assumptions that management believes to be reasonable under the circumstances and is provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes.

Additional information regarding Trican including Trican's most recent annual information form is available under Trican's profile on SEDAR (www.sedar.com).

Headquartered in Calgary, Alberta, Trican has operations in Canada, the United States, Russia, Kazakhstan, Australia, Algeria, Norway, Colombia and Saudi Arabia. Trican provides a comprehensive array of specialized products, equipment and services that are used during the exploration and development of oil and gas reserves.

Contacts:
Requests for shareholder information should be directed to:
Trican Well Service Ltd.
Dale Dusterhoft
Chief Executive Officer
[email protected]

Trican Well Service Ltd.
Michael Baldwin
Senior Vice President, Finance & CFO
[email protected]

Trican Well Service Ltd.
Gary Summach
Director of Reporting and Investor Relations
[email protected]

Trican Well Service Ltd.
2900, 645 - 7th Avenue S.W.
Calgary, Alberta T2P 4G8
(403) 266 - 0202
(403) 237 - 7716 (FAX)
www.trican.ca

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
Skeuomorphism usually means retaining existing design cues in something new that doesn’t actually need them. However, the concept of skeuomorphism can be thought of as relating more broadly to applying existing patterns to new technologies that, in fact, cry out for new approaches. In his session at DevOps Summit, Gordon Haff, Senior Cloud Strategy Marketing and Evangelism Manager at Red Hat, discussed why containers should be paired with new architectural practices such as microservices rathe...
U.S. companies are desperately trying to recruit and hire skilled software engineers and developers, but there is simply not enough quality talent to go around. Tiempo Development is a nearshore software development company. Our headquarters are in AZ, but we are a pioneer and leader in outsourcing to Mexico, based on our three software development centers there. We have a proven process and we are experts at providing our customers with powerful solutions. We transform ideas into reality.
Any Ops team trying to support a company in today’s cloud-connected world knows that a new way of thinking is required – one just as dramatic than the shift from Ops to DevOps. The diversity of modern operations requires teams to focus their impact on breadth vs. depth. In his session at DevOps Summit, Adam Serediuk, Director of Operations at xMatters, Inc., will discuss the strategic requirements of evolving from Ops to DevOps, and why modern Operations has begun leveraging the “NoOps” approa...
Organizations from small to large are increasingly adopting cloud solutions to deliver essential business services at a much lower cost. According to cyber security experts, the frequency and severity of cyber-attacks are on the rise, causing alarm to businesses and customers across a variety of industries. To defend against exploits like these, a company must adopt a comprehensive security defense strategy that is designed for their business. In 2015, organizations such as United Airlines, Sony...
Puppet Labs has announced the next major update to its flagship product: Puppet Enterprise 2015.2. This release includes new features providing DevOps teams with clarity, simplicity and additional management capabilities, including an all-new user interface, an interactive graph for visualizing infrastructure code, a new unified agent and broader infrastructure support.
WebRTC has had a real tough three or four years, and so have those working with it. Only a few short years ago, the development world were excited about WebRTC and proclaiming how awesome it was. You might have played with the technology a couple of years ago, only to find the extra infrastructure requirements were painful to implement and poorly documented. This probably left a bitter taste in your mouth, especially when things went wrong.
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Red Hat is investing in Tesora, the number one contributor to OpenStack Trove Database as a Service (DBaaS) also ranked among the top 20 companies contributing to OpenStack overall. Tesora, the company bringing OpenStack Trove Database as a Service (DBaaS) to the enterprise, has announced that Red Hat and others have invested in the company as a part of Tesora's latest funding round. The funding agreement expands on the ongoing collaboration between Tesora and Red Hat, which dates back to Febr...
As more and more data is generated from a variety of connected devices, the need to get insights from this data and predict future behavior and trends is increasingly essential for businesses. Real-time stream processing is needed in a variety of different industries such as Manufacturing, Oil and Gas, Automobile, Finance, Online Retail, Smart Grids, and Healthcare. Azure Stream Analytics is a fully managed distributed stream computation service that provides low latency, scalable processing of ...
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
With the proliferation of connected devices underpinning new Internet of Things systems, Brandon Schulz, Director of Luxoft IoT – Retail, will be looking at the transformation of the retail customer experience in brick and mortar stores in his session at @ThingsExpo. Questions he will address include: Will beacons drop to the wayside like QR codes, or be a proximity-based profit driver? How will the customer experience change in stores of all types when everything can be instrumented and a...
Consumer IoT applications provide data about the user that just doesn’t exist in traditional PC or mobile web applications. This rich data, or “context,” enables the highly personalized consumer experiences that characterize many consumer IoT apps. This same data is also providing brands with unprecedented insight into how their connected products are being used, while, at the same time, powering highly targeted engagement and marketing opportunities. In his session at @ThingsExpo, Nathan Trel...
Cloud and datacenter migration innovator AppZero has joined the Microsoft Enterprise Cloud Alliance Program. AppZero is a fast, flexible way to move Windows Server applications from any source machine – physical or virtual – to any destination server, in any cloud or datacenter, using its patented container technology. AppZero’s container is also called a Virtual Application Appliance (VAA). To facilitate Microsoft Azure onboarding, AppZero has two purpose-built offerings: AppZero SP for Azure,...
WSM International, the pioneer and leader in server migration services, has announced an agreement with WHOA.com, a leader in providing secure public, private and hybrid cloud computing services. Under terms of the agreement, WSM will provide migration services to WHOA.com customers to relocate some or all of their applications, digital assets, and other computing workloads to WHOA.com enterprise-class, secure cloud infrastructure. The migration services include detailed evaluation and planning...
SYS-CON Events announced today that G2G3 will exhibit at SYS-CON's @DevOpsSummit Silicon Valley, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Based on a collective appreciation for user experience, design, and technology, G2G3 is uniquely qualified and motivated to redefine how organizations and people engage in an increasingly digital world.