Welcome!

News Feed Item

Enterprise Group Announces Results for the Second Quarter of 2014

ST. ALBERT, ALBERTA -- (Marketwired) -- 08/13/14 -- Enterprise Group, Inc. ("Enterprise," or "the Company") (TSX:E) is pleased to announce its financial results for the three month period ended June 30, 2014 ("the second quarter"). Enterprise's second quarter results reflect considerable contributions from acquisitions made during 2013, as well as steady demand for the Company's services.

SECOND QUARTER HIGHLIGHTS


--  Quarterly revenue of $14.1 million, an increase of $9.3 million, or
    194%, when compared to the prior year, due primarily to the impact of
    acquisitions. 
--  Quarterly EBITDAS of $2.6, compared to approximately break-even in the
    prior year. 
--  Enterprise in on track to deploy the $20.0 million in capital
    expenditures the Company planned for 2014. As a result, the substantial
    majority of the equipment purchased as a result of these expenditures
    will be active by the fourth quarter of 2014. 
--  On July 31, 2014, the Company announced that it had signed a letter of
    intent to acquire a privately-owned oilfield site services rental
    company (the "Acquisition Target") based in Fort St. John, British
    Columbia. The Company expects to complete this acquisition by October
    2014. 

----------------------------------------------------------------------------
                  Three months   Three months     Six months     Six months 
Consolidated:    June 30, 2014  June 30, 2013  June 30, 2014  June 30, 2013 
----------------------------------------------------------------------------
Revenue            $14,069,617     $4,831,035    $35,176,922    $13,735,415 
Gross margin        $5,526,067     $1,671,955    $16,055,502     $6,873,922 
Gross margin %              39%            35%            46%            50%
EBITDAS             $2,656,735         $4,862     $9,703,707     $3,906,165 
Net Income            $329,959    $(1,542,924)    $4,656,775     $1,623,959 
EPS                      $0.00         $(0.02)         $0.04          $0.03 
Total Assets      $130,047,730    $48,955,461   $130,047,730    $48,955,461 
----------------------------------------------------------------------------

Enterprise's second quarter results reflect both the continued positive impact of the acquisitions completed during the prior 12 months and steady demand for the Company's services. While the Company's EBITDAS and EBITDAS margin increased significantly when compared to the second quarter of 2013, both of these metrics declined when compared to the Company's results for the first quarter of 2014. These declines reflect the need for the Company to maintain commitments during a period of seasonal downturn in order to prepare for the higher demand for services during the second half of 2014, as well as an increased use of third-party equipment. Commitments during the second quarter included Enterprise maintaining a full complement of operational employees in order to prepare for a more robust business cycle during the latter half of the year. Both EBITDAS and EBITDAS margin are expected to improve meaningfully during the third and fourth quarters of 2014, due to both seasonal increases in demand and the replacement of subcontracted equipment by the capital assets the Company has purchased over the course of 2014. The Company's earnings per share increased slightly during the second quarter, primarily due to the improvements in both revenue and EBITDAS when compared to the second quarter of 2013.

Enterprise remains on track to deploy $20.0 million of capital expenditures over the course of 2014. These capital expenditures are intended to create improvements in both the Company's revenue and operating margins. Management believes these improvements will be reflected in the Company's operating results during the second half of 2014. The Company anticipates that it will have completed the substantial majority of its planned capital expenditures for 2014 by the conclusion of the third quarter.

"We are satisfied by Enterprise's results for the second quarter, which once again demonstrate the benefits of our selective acquisition strategy," stated Leonard Jaroszuk, the Company's Chief Executive Officer. "While this quarter's results are reflective of a seasonal slowdown, we were pleased by the consistent demand for our services, and by our ability to maintain our commitments to our workforce as we prepare for the second half of 2014."

"Seasonal demand is historically much higher during the latter half of the year, and Enterprise is ideally positioned to service this demand. Our capital spending over the course of 2014 has significantly increased our operating capacity. That capacity will grow further upon completion of our recently announced acquisition. The Fort St. John region is a critical area in the development of Western Canada's LNG industry. I am confident this acquisition will be immediately accretive to our business, and will establish Enterprise within Fort St. John and will better position us to meet the demands of the LNG industry."

"Over the past year, Enterprise has developed a track record of rapid and successful integration," concluded Mr. Jaroszuk. "We have already begun planning for the integration of this new addition. As a result, we anticipate that the fourth quarter of 2014 will not only reflect a full three months of this acquisition's contributions, but also benefit from its synergies with our existing operations. All of these factors - seasonal improvement, our expanded capacity, and our upcoming acquisition - give us great optimism for Enterprise's future, both in the months ahead and over the long-term."

Utilities/Infrastructure Division


----------------------------------------------------------------------------
Utilities/Infras                                                            
 tructure          Three months   Three months     Six months     Six months
 Construction:    June 30, 2014  June 30, 2013  June 30, 2014  June 30, 2013
----------------------------------------------------------------------------
Revenue              $8,311,555     $4,308,597    $16,788,960     $8,157,806
  Increase           $4,002,958                    $8,631,154               
EBITDAS              $2,403,741     $1,335,550     $4,771,499     $2,426,841
  Increase           $1,068,191                    $2,344,658               
Total Assets        $46,624,155    $27,626,731    $46,624,155    $27,626,731
  Increase          $18,997,424                   $18,997,424               
----------------------------------------------------------------------------

Enterprise's Utilities/Infrastructure Division generated second quarter revenue of $8.3 million, an increase of $4.0 million when compared to the prior year. This improvement can be attributed to the acquisition of Calgary Tunnelling & Horizontal Augering Ltd. ("CTHA") in June of 2013, an increase in activity, and the expansion of Enterprise's service equipment fleet, which has allowed the Company to both increase its capacity and attract projects from major customers. This division's EBITDAS margin of 29% reflects both a change in revenue mix due to the acquisition of CTHA and an increased use of third-party equipment necessitated by strong demand at T.C. Backhoe. This metric is expected to improve as recently purchased capital assets replace subcontracted equipment currently in use. Enterprise's capital plan allocates the funds necessary to increase its hydrovac fleet to 20 units. The Company currently has 16 units in operation.

Equipment Rental Division


----------------------------------------------------------------------------
                                                                            
Equipment          Three months  Three months      Six months     Six months
 Rental:          June 30, 2014 June 30, 2013   June 30, 2014  June 30, 2013
----------------------------------------------------------------------------
Revenue              $5,758,062      $522,438     $18,387,962     $5,577,609
  Increase           $5,235,624                   $12,810,353               
EBITDAS              $1,349,265     $(203,833)     $7,224,667     $3,320,662
  Increase           $1,553,098                    $3,904,005               
Total Assets        $56,540,496   $15,832,136     $56,540,496    $15,832,136
  Increase          $40,708,360                   $40,708,360               
----------------------------------------------------------------------------

Enterprise's Equipment Rental Division generated second quarter revenue of $5.8 million, an increase of $5.2 million when compared to the prior year. This improvement was primarily due to the acquisition of Hart at the beginning of the first quarter. This division's EBITDAS margin of 22% reflects a change in revenue mix due to the acquisition of Hart, and is expected to improve as recently purchased capital assets replace subcontracted equipment currently in use.

Major Developments

On July 31, 2014, Enterprise announced that it had signed a letter of intent to acquire a privately-owned oilfield site services rental company. The purchase price for this acquisition will be based upon the Acquisition Target's most recent financial statements, which are currently being audited, as well as the conclusion of a complete appraisal of the Acquisition Target's assets. The acquisition will be funded by a combination of Enterprise shares, cash, and vendor take-back financing.

Over the past ten years, the Acquisition Target has developed a highly-regarded full-service oilfield site infrastructure company that fulfills multiple equipment rental needs for a variety of oil and gas customers. The Acquisition Target's equipment fleet currently consists of approximately 350 owned pieces. This acquisition expedites Enterprise's plans to be operating three of its subsidiaries in Fort St. John by the fourth quarter of 2014. The owner of the Acquisition Target has agreed to sign a five-year management agreement with the Company.

Enterprise anticipates completing this acquisition by October of 2014. This completion will be subject to negotiation of a definitive share purchase agreement, the Company's finalization of satisfactory due diligence, and customary closing conditions.

About Enterprise Group, Inc.

Enterprise Group, Inc. is a consolidator of construction services companies operating in the energy, utility and transportation infrastructure industries. The Company's focus is primarily construction services and specialized equipment rental. The Company's strategy is to acquire complementary service companies in Western Canada, consolidating capital, management, and human resources to support continued growth. Enterprise acquired Artic Therm International Ltd. in September 2012, Calgary Tunnelling & Horizontal Augering Ltd. in June 2013, and Hart Oilfield Rentals Ltd. in January 2014.

Forward-Looking Information

Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company's future performance. The use of any of the words "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.

Non-IFRS Measures

The Company uses International Financial Reporting Standards ("IFRS"). EBITDAS is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-IFRS measure. This news release contains references to EBITDAS. This non-IFRS measure used by the Company may not be comparable to a similar measure used by other companies. Management believes that in addition to net income, EBITDAS is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDAS is calculated as net income excluding depreciation, amortization, interest, taxes and stock based compensation.

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
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
Fact is, enterprises have significant legacy voice infrastructure that’s costly to replace with pure IP solutions. How can we bring this analog infrastructure into our shiny new cloud applications? There are proven methods to bind both legacy voice applications and traditional PSTN audio into cloud-based applications and services at a carrier scale. Some of the most successful implementations leverage WebRTC, WebSockets, SIP and other open source technologies. In his session at @ThingsExpo, Da...
Leading cloud-centric IT organizations are establishing core capabilities to improve productivity, control costs and provide a highly responsive end-user experience. Key steps along this journey include creating an end-user cloud services catalog, automating workflows and provisioning, and implementing IT showback and chargeback. In his session at 19th Cloud Expo, Mark Jamensky, executive vice president of Products at Embotics, will walk attendees through an in-depth case study of enterprise I...
SYS-CON Events announced today that Niagara Networks will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Niagara Networks offers the highest port-density systems, and the most complete Next-Generation Network Visibility systems including Network Packet Brokers, Bypass Switches, and Network TAPs.
SYS-CON Events announced today the Kubernetes and Google Container Engine Workshop, being held November 3, 2016, in conjunction with @DevOpsSummit at 19th Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA. This workshop led by Sebastian Scheele introduces participants to Kubernetes and Google Container Engine (GKE). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, students learn the key concepts and practices for deploying and maintainin...
Your business relies on your applications and your employees to stay in business. Whether you develop apps or manage business critical apps that help fuel your business, what happens when users experience sluggish performance? You and all technical teams across the organization – application, network, operations, among others, as well as, those outside the organization, like ISPs and third-party providers – are called in to solve the problem.
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service. In his session at 19th Cloud Exp...
SYS-CON Events announced today that Roundee / LinearHub will exhibit at the WebRTC Summit at @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LinearHub provides Roundee Service, a smart platform for enterprise video conferencing with enhanced features such as automatic recording and transcription service. Slack users can integrate Roundee to their team via Slack’s App Directory, and '/roundee' command lets your video conference ...
Apache Hadoop is a key technology for gaining business insights from your Big Data, but the penetration into enterprises is shockingly low. In fact, Apache Hadoop and Big Data proponents recognize that this technology has not yet achieved its game-changing business potential. In his session at 19th Cloud Expo, John Mertic, director of program management for ODPi at The Linux Foundation, will explain why this is, how we can work together as an open data community to increase adoption, and the i...
Using new techniques of information modeling, indexing, and processing, new cloud-based systems can support cloud-based workloads previously not possible for high-throughput insurance, banking, and case-based applications. In his session at 18th Cloud Expo, John Newton, CTO, Founder and Chairman of Alfresco, described how to scale cloud-based content management repositories to store, manage, and retrieve billions of documents and related information with fast and linear scalability. He addres...
Digital transformation is too big and important for our future success to not understand the rules that apply to it. The first three rules for winning in this age of hyper-digital transformation are: Advantages in speed, analytics and operational tempos must be captured by implementing an optimized information logistics system (OILS) Real-time operational tempos (IT, people and business processes) must be achieved Businesses that can "analyze data and act and with speed" will dominate those t...
IoT is fundamentally transforming the auto industry, turning the vehicle into a hub for connected services, including safety, infotainment and usage-based insurance. Auto manufacturers – and businesses across all verticals – have built an entire ecosystem around the Connected Car, creating new customer touch points and revenue streams. In his session at @ThingsExpo, Macario Namie, Head of IoT Strategy at Cisco Jasper, will share real-world examples of how IoT transforms the car from a static p...
While DevOps promises a better and tighter integration among an organization’s development and operation teams and transforms an application life cycle into a continual deployment, Chef and Azure together provides a speedy, cost-effective and highly scalable vehicle for realizing the business values of this transformation. In his session at @DevOpsSummit at 19th Cloud Expo, Yung Chou, a Technology Evangelist at Microsoft, will present a unique opportunity to witness how Chef and Azure work tog...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo Silicon Valley Call for Papers is now open.
Almost two-thirds of companies either have or soon will have IoT as the backbone of their business in 2016. However, IoT is far more complex than most firms expected. How can you not get trapped in the pitfalls? In his session at @ThingsExpo, Tony Shan, a renowned visionary and thought leader, will introduce a holistic method of IoTification, which is the process of IoTifying the existing technology and business models to adopt and leverage IoT. He will drill down to the components in this fra...