Welcome!

News Feed Item

Logan International Reports First Quarter 2014 Financial Results

(All reported figures are in US dollars unless otherwise noted)

CALGARY, ALBERTA -- (Marketwired) -- 05/13/14 -- Logan International Inc. (TSX: LII) ("Logan" or the "Company") today reported the results of its first quarter ended March 31, 2014. The financial reports for the quarter ended March 31, 2014 include the post-acquisition operating results of the Sup-R-Jar product line, which was acquired in April 2013.

Highlights include:


--  The Company has rebuilt Logan Oil Tools backlog to approximately $25
    million at April 30, 2014, which is its greatest level since early 2013.
--  Reorganization of the downhole tool segment's supply chain and the
    rental tool segment structure.
--  Logan appointed David MacNeill as President and Chief Executive Officer
    beginning June 16, 2014, ensuring outstanding leadership. Gerald Hage
    will remain as a director and will provide assistance during the
    transition.

Logan recorded revenue of $43.6 million in this year's first quarter and $49.2 million in the prior year's first quarter. For the three month period ended March 31, 2014, Logan earned $2.9 million, $.09 per share, as compared to $5.2 million, $.16 per share in the prior year period. Modified EBITDA declined in this year's first quarter to $9.3 million from $12.1 million in last year's first quarter. Management utilizes Modified EBITDA to evaluate its operating results because this measurement eliminates the effects of noncash and nonrecurring revenue and cost.

For the quarter ended March 31, 2014, the downhole tool segment, which includes Logan Oil Tools, Logan Completion Systems ("Logan Completions"), Kline Oilfield Equipment ("Kline"), Logan SuperAbrasives ("SuperAbrasives") and Scope Production Developments ("Scope"), recorded revenue of $40.4 million as compared to $44.3 million for the quarter ended March 31, 2013. For the quarter ended March 31, 2014, this segment generated EBITDA of $9.9 million as compared to $10.9 million for the quarter ended March 31, 2013. For the first quarter of 2014, the rental tool segment, which includes Xtend Energy Services ("Xtend") and Logan Jar, recorded revenue of $3.2 million and EBITDA of approximately $780 thousand as compared to revenue of $4.9 million and EBITDA of $2.8 million in last year's first quarter.

Gerald Hage, President and Chief Executive Officer, commented, "Our first quarter performance was below expectations as revenue in both segments trailed last year's first quarter and also fell short of our plan. The decline in the downhole tool segment's EBITDA was a direct result of the decline in revenue. Logan Oil Tools' sales declined by approximately $5 million, most of which was related to a decline in sales of stroking tools. We believe the weakness in Logan Oil Tools is short term and we fully expect to see a recovery in the remainder of the year as the order flow has rebounded. We have booked orders totaling approximately $48 million during the four months ended April 30, 2014 as compared to approximately $32 million in the corresponding period last year. SuperAbrasives' sales declined by approximately $500 thousand in the current year quarter from the prior year quarter, primarily due to a reduction in international sales, which tend to be sporadic. We also expect an improvement in SuperAbrasives' operating results throughout the remainder of the year due to recently booked international orders and anticipated increases in bearings sales and service work. Logan Completions and Kline both reported stronger operating results in this year's first quarter as compared to last year's first quarter.

"Logan Completions' improved operating results were due to an increase in sales of approximately $2.5 million, while Kline's improvement resulted from increased operating margins due to better execution. Scope reported modest declines in both revenue and operating results in this year's first quarter. In the rental tool segment, Xtend's first quarter revenue declined to $2.9 million from $4.9 million in 2013. The decline occurred mostly in our Canadian operations and was attributable to a decline in demand and, to a lesser extent, a slower startup in 2014 drilling activity and a decrease in the value of the Canadian dollar relative to the U.S. dollar. We also experienced a decline in U.S. operations, which was related to customer drilling efficiencies in the Eagle Ford basin, which was our largest U.S. market. As a result, drilling days per well have been reduced, which has led to lower rental revenue. We have recently expanded to West Texas and the Mid-Continent markets to reduce our dependence on the South Texas market."

Looking forward, Mr. Hage added, "While the first quarter results did not meet our expectations, we have not changed our outlook for the year. We believe the downhole tool segment's operating results will recover in the second quarter due to the upward trend in order flow for Logan Oil Tools and SuperAbrasives. Except for the seasonal slowdown in Logan Completions' Canadian operations, we also expect strong performance from our completion operations, Logan Completions and Kline, for the remainder of 2014. We recently initiated the reorganization of Logan Completions' and Kline's supply chains by combining their engineering and manufacturing operations with those of Logan Oil Tools. We have also initiated a reorganization of the rental tool segment by combining the operations of the Xciter and Sup-R-Jar drilling tools with the fishing jar rentals into a single business unit. We believe this will broaden both the North American and international markets for the rental tools and will also allow for improved management accountability for operating results."

"In our last report, we announced the addition of David MacNeill as our Chief Operating Officer. I am pleased to announce Mr. MacNeill's appointment as my successor as the President and Chief Executive Officer. Dave's experience in drilling engineering in the West African, Eastern European and Far Eastern markets will accelerate Logan's international business. I want to emphasize that I will continue my relationship with Logan as a director and will assist Dave in the transition period," said Mr. Hage.

Logan manufactures and sells a comprehensive line of quality fishing and intervention tools, including retrieving, surface, stroking and remedial tools for a variety of well workover, intervention, drilling, and completion activities (Logan Oil Tools, Inc.); manufactures and sells high-performance polycrystalline diamond compact (PDC) cutters and bearings (Logan SuperAbrasives), manufactures and sells packers, bridge plugs, and other completion products (Kline Oilfield Equipment, Inc.); provides proprietary multi-zonal completion technology and conventional completion production products and services (Logan Completion Systems Inc.); provides proprietary and patented products and services that are focused on production optimization in sand-laden heavy oil wells (Scope Production Development Ltd.); and provides proprietary tools that enhance the effectiveness of horizontal drilling (Xtend Energy Services Inc. and Logan Jar, LLC). Common shares of Logan are traded on the Toronto Stock Exchange (TSX) under the ticker symbol "LII".



Selected Consolidated Financial Information
(in thousands of US dollars, except per share
 data)
                                                 Three month periods ended
                                                          March 31,
                                               -----------------------------
                                                         2014           2013
                                               -------------- --------------

Revenue                                         $      43,644  $      49,194

Net earnings for the period                             2,901          5,238

Earnings per share:
  Basic                                         $        0.09  $        0.16
  Diluted                                       $        0.09  $        0.16

EBITDA (1)                                      $       8,840  $      11,770
Modified EBITDA (1)                             $       9,321  $      12,139
                                               -------------- --------------

                                                    March 31,   December 31,
                                                         2014           2013
                                               -------------- --------------
                                               -------------- --------------
Working Capital                                 $      36,387  $      82,399
Total Assets                                    $     278,659  $     283,559
Debt (2)                                        $      55,460  $      57,788
Shareholders' Equity                            $     192,357  $     191,144

Note: On April 17, 2013, the Company, through its wholly-owned subsidiaries
Logan Oil Tools, Inc. and Logan Jar, LLC, purchased certain assets and
operations related to the Sup-R-Jar drilling jar product line. As such, none
of the Sup-R-Jar product line's operating results have been included in the
Company's condensed interim consolidated financial statements for the three
month period ended March 31, 2013.

(1) Non-IFRS Measurements: The MD&A presents: (a) EBITDA as earnings before
net finance cost, income taxes, and depreciation and amortization
("EBITDA"), and (b) Modified EBITDA as EBITDA before acquisition accounting
adjustments, transaction fees, share-based compensation and severance costs
("Modified EBITDA"). Neither of these measurements should be considered an
alternative to, or more meaningful than, "net earnings for the period" or
"cash flow from operating activities" as determined in accordance with IFRS
as an indicator of the Company's financial performance. EBITDA and Modified
EBITDA do not have standardized definitions as prescribed by IFRS;
therefore, the Company's presentation of these measurements may not conform
to similar presentations by other companies. Management calculates EBITDA
and Modified EBITDA each period and evaluates the Company's operating
performance based on these measurements. Management believes that Modified
EBITDA, which eliminates significant non-cash or non-recurring items of
revenue or cost, more accurately presents the results of the Company's
ongoing operations and its ability to generate the cash required to fund or
finance future growth, acquisitions and capital investments. A
reconciliation of EBITDA and Modified EBITDA with net earnings for each
period follows.


                                                 Three month periods ended
                                                         March 31,
                                              ------------------------------
                                                       2014             2013
                                              -------------    -------------

  Net earnings for the period                   $     2,901      $     5,238
Addbacks:
  Depreciation and amortization                       3,249            2,791
  Finance cost, net                                   1,323            1,250
  Income tax expense                                  1,367            2,491
                                              -------------    -------------
EBITDA                                                8,840           11,770
Adjustments:
  Acquisition accounting adjustments                    188       -
  Transaction fees                                       16               92
  Severance costs                                       140       -
  Share-based compensation payments                     137              277
                                              -------------    -------------
Modified EBITDA                                 $     9,321      $    12,139
                                              -------------    -------------
                                              -------------    -------------

EBITDA and Modified EBITDA are provided as measures of the Company's
 operating performance without regard to financing decisions, share-based
 compensation payments, age and cost of equipment used and income tax
 impacts, all of which are factors that are not controlled at the operating
 management level. The acquisition accounting adjustments reverse the effect
 of the increase or step-up in cost basis of inventories and subsequently
 sold fixed assets acquired in business combinations. The transaction fees
 include the professional and other fees incurred in connection with
 acquisitions in 2012 and 2013. Share-based compensation relates to expense
 recognized from the granting of stock appreciation rights, stock options
 and restricted share units.

(2) Includes bank and other borrowed debt and capital leases.

Reconciliation of EBITDA by Segment

               Three months ended March 31,    Three months ended March 31,
                           2014                            2013
              ------------------------------  ------------------------------
               Downhole   Rental               Downhole   Rental
                   Tool     Tool   Corporate       Tool     Tool  Corporate
              ------------------------------  ------------------------------

Revenue       $  40,395 $  3,249  $        -  $  44,318 $  4,876 $        -

Earnings
 (loss) from
 operations   $   7,691 $   (176) $   (1,924) $   8,606 $  2,369 $   (1,996)
 Depreciation
  and
  amortization    2,244      956          49      2,312      432         47
              ------------------------------- -----------------------------
EBITDA        $   9,935     780$  $   (1,875)  $ 10,918 $  2,801 $   (1,949)
              ------------------------------- -----------------------------

Forward-Looking Statements

This press release contains forward-looking statements. These statements relate to future events or future performance of Logan. When used in this press release, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "propose", "expect", "potential", "continue", and similar expressions, are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such statements reflect Logan's current views with respect to certain events, including the previously announced strategic review process and fourth quarter operating results, and are subject to certain risks, uncertainties and assumptions. Although Logan believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because we can give no assurance that they will prove to be correct. Many factors could cause Logan's actual results, performance, or achievements to materially differ from those described in this press release. Readers are referred to Logan's Annual Information Form filed on www.sedar.com, which identifies significant risk factors that could cause actual results to differ from those contained in the forward-looking statements. Should one or more risks or uncertainties materialize or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this press release. The forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. These statements speak only as of the date of this press release. Logan does not intend and does not assume any obligation to update these forward-looking statements to reflect new information, subsequent events or otherwise, except as required by law. This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities described herein in any jurisdiction.

For more information about Logan International Inc., please visit our website at www.loganinternationalinc.com.

Contacts:
Logan International Inc.
David MacNeill
Chief Operating Officer
281-617-5300 Houston

Logan International Inc.
Larry Keister
Chief Financial Officer
832-386-2534 Houston

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
SYS-CON Events announced today that Calligo, an innovative cloud service provider offering mid-sized companies the highest levels of data privacy and security, has been named "Bronze Sponsor" of SYS-CON's 21st International Cloud Expo ®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Calligo offers unparalleled application performance guarantees, commercial flexibility and a personalised support service from its globally located cloud plat...
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
SYS-CON Events announced today that DXWorldExpo has been named “Global Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Digital Transformation is the key issue driving the global enterprise IT business. Digital Transformation is most prominent among Global 2000 enterprises and government institutions.
SYS-CON Events announced today that Datera, that offers a radically new data management architecture, has been named "Exhibitor" of SYS-CON's 21st International Cloud Expo ®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datera is transforming the traditional datacenter model through modern cloud simplicity. The technology industry is at another major inflection point. The rise of mobile, the Internet of Things, data storage and Big...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, will examine the regulations and provide insight on how it affects technology, challenges the established rules and will usher in new levels of diligence...
In his session at @ThingsExpo, Sudarshan Krishnamurthi, a Senior Manager, Business Strategy, at Cisco Systems, discussed how IT and operational technology (OT) work together, as opposed to being in separate siloes as once was traditional. Attendees learned how to fully leverage the power of IoT in their organization by bringing the two sides together and bridging the communication gap. He also looked at what good leadership must entail in order to accomplish this, and how IT managers can be the ...
DX World EXPO, LLC., a Lighthouse Point, Florida-based startup trade show producer and the creator of "DXWorldEXPO® - Digital Transformation Conference & Expo" has announced its executive management team. The team is headed by Levent Selamoglu, who has been named CEO. "Now is the time for a truly global DX event, to bring together the leading minds from the technology world in a conversation about Digital Transformation," he said in making the announcement.
As businesses adopt functionalities in cloud computing, it’s imperative that IT operations consistently ensure cloud systems work correctly – all of the time, and to their best capabilities. In his session at @BigDataExpo, Bernd Harzog, CEO and founder of OpsDataStore, presented an industry answer to the common question, “Are you running IT operations as efficiently and as cost effectively as you need to?” He then expounded on the industry issues he frequently came up against as an analyst, and ...
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution and join Akvelon expert and IoT industry leader, Sergey Grebnov, in his session at @ThingsExpo, for an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
SYS-CON Events announced today that SkyScale will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. SkyScale is a world-class provider of cloud-based, ultra-fast multi-GPU hardware platforms for lease to customers desiring the fastest performance available as a service anywhere in the world. SkyScale builds, configures, and manages dedicated systems strategically located in maximum-securit...
"Outscale was founded in 2010, is based in France, is a strategic partner to Dassault Systémes and has done quite a bit of work with divisions of Dassault," explained Jackie Funk, Digital Marketing exec at Outscale, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
In the enterprise today, connected IoT devices are everywhere – both inside and outside corporate environments. The need to identify, manage, control and secure a quickly growing web of connections and outside devices is making the already challenging task of security even more important, and onerous. In his session at @ThingsExpo, Rich Boyer, CISO and Chief Architect for Security at NTT i3, discussed new ways of thinking and the approaches needed to address the emerging challenges of security i...
"With Digital Experience Monitoring what used to be a simple visit to a web page has exploded into app on phones, data from social media feeds, competitive benchmarking - these are all components that are only available because of some type of digital asset," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at DevOps Summit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
"We were founded in 2003 and the way we were founded was about good backup and good disaster recovery for our clients, and for the last 20 years we've been pretty consistent with that," noted Marc Malafronte, Territory Manager at StorageCraft, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
"At the keynote this morning we spoke about the value proposition of Nutanix, of having a DevOps culture and a mindset, and the business outcomes of achieving agility and scale, which everybody here is trying to accomplish," noted Mark Lavi, DevOps Solution Architect at Nutanix, in this SYS-CON.tv interview at @DevOpsSummit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.