Welcome!

News Feed Item

CERF Incorporated Announces 2014 Second Quarter Results

CERF Reports Revenue of $10 million, Adjusted EBITDA(1) of $2.6 million and Net Income of $257 thousand for Q2 2014

CALGARY, ALBERTA -- (Marketwired) -- 08/18/14 -- Mr. Wayne Wadley, President of CERF Incorporated (the "Company" or "CERF")(TSX VENTURE: CFL), is pleased to announce financial and operating results for the Company for the three months ended June 30, 2014.

"On the whole, CERF delivered a strong second quarter, increasing net income by more than $390 thousand, Adjusted EBITDA by 46%, and again reported revenues in excess of $10 million," stated Wayne Wadley, President and CEO. "Despite several construction related project delays that impacted our 4-Way business, we are very pleased to announce the eighth consecutive quarter in which CERF has delivered results exceeding those reported a year earlier."

Full details of the Company's financial results, in the form of the unaudited, condensed, consolidated interim financial statements and notes for the three months ended June 30, 2014 and Management's Discussion and Analysis of the results are available on SEDAR at www.sedar.com and on the Company's website at www.cerfcorp.com.

Selected Q2 2014 Financial Highlights:


--  Net income increased to $257,000 or $0.02 per basic share in the quarter
    versus a net loss of $134,000 or ($0.01) per share during the prior
    year's quarter;
--  Adjusted EBITDA increased 46% to $2,602,000 for the quarter ended June
    30, 2014, compared to $1,784,000 for Q2 2013.
--  EBITDA per basic share, increased 7% to $0.16 in the second quarter
    versus $0.15 in 2013;
--  The Company paid dividends of $0.06 per share to shareholders in Q2 2014
    while maintaining the annualized payout ratio to 65% from an annualized
    payout ratio of 89% as at Q1 2013; and
--  During the second quarter, 252,900 warrants were executed resulting in
    proceeds of $796,000 and the exercise of 177,685 agent options resulted
    in proceeds of another $478,000.

Corporate Highlights:

CORPORATE


--  As at August 13, 2014, 2,264,636 warrants have been exercised for total
    proceeds of $7.1 million and 245,006 agent options have been exercised
    for proceeds of $662,000.

EQUIPMENT RENTAL, SALES AND SERVICE ACQUISITIONS


--  On May 28, 2014, CERF enhanced its capability to provide equipment used
    in directional drilling applications with the acquisition of the
    business and assets of Empire Tool Inc. ("Empire"), a privately owned
    oilfield service and rental business for $9.2 million or approximately
    3.3 times Empire's 2013 adjusted and normalized EBITDA.
--  On June 26, 2014, CERF announced the proposed strategic business
    combination with Winalta Inc. ("Winalta")(TSXV: WTA), a publically traded
    oilfield accommodation rentals business. With an implied purchase price
    of approximately $65 million including net debt, CERF is acquiring
    Winalta at approximately 4.8 times EV / 2014E EBITDA creating some of
    the following benefits:
    --  increased EBITDA margins;
    --  reduced cash flow volatility due to the contract backed nature of
        Winalta's business;
    --  expanded geographic positioning;
    --  a more diverse suite of rental assets; and
    --  greater overall market penetration amongst E&P clients.

"The additions of Empire and Winalta greatly enhance our size and scope in the oilfield rental and services space," stated Mr. Wadley. "Both acquisitions complement and significantly grow our equipment fleet, enabling us to service a much broader customer base. Subject to shareholder approval on August 27, 2014, we look forward to welcoming the entire Winalta team to join us in continuing to expand our business and add value for our shareholders."

WASTE MANAGEMENT


--  Margins for MCL were $1,208,000, an increase of 770% when compared those
    delivered in the prior year's quarter. Improvements are a result of
    increased impacted soil volumes, operational productivity and the
    positive result of initiatives to improve the quality of revenue and
    reduce expenses which were implemented in the previous quarter.

Summary of Second Quarter Consolidated Financial Results:


----------------------------------------------------------------------------
                                          Three months ended June 30,
(in $,000s except percentages and
 per share data)                         2014      2013  $ Change         %
----------------------------------------------------------------------------
Revenue                                10,014    10,065       -51        -1%
Direct Expenses                         7,661     8,301      -640        -8%
Gross margin                            2,353     1,764       589        33%
Net income (loss)                         257      -134       391         -
Net income (loss) per basic share        0.02     -0.01      0.03         -
Adjusted EBITDA(1)                      2,602     1,784       818        46%
Adjusted Free Cash Flow                   667      -963     1,630         -
Annualized payout ratio                    65%       89%      -24%        -
Dividends per basic share               $0.06     $0.06         -         -
----------------------------------------------------------------------------

(1) See Financial Measures Reconciliations on page 4 of CERF's Second Quarter 2014 MD&A

Summarized financial results for the three months ended June 30, 2014 follow:

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

(Unaudited) IN THOUSANDS OF CANADIAN DOLLARS


                                                               December 31,
                                               June 30, 2014           2013
----------------------------------------------------------------------------
Assets
Current assetsCash                                         -            557
  Accounts receivable                                  8,369          8,433
  Inventory                                            2,261          1,561
  Income taxes recoverable                                21              -
  Prepaid expenses and deposits                          519            397
----------------------------------------------------------------------------
                                                      11,170         10,948
----------------------------------------------------------------------------

Non-current assets
Long-term receivable                                     122            238
  Property and equipment                              44,434         36,890
  Intangibles and goodwill                            14,271         10,714
----------------------------------------------------------------------------
                                                      58,827         47,842
----------------------------------------------------------------------------
Total assets                                          69,997         58,790
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Liabilities and Shareholders' Equity
Current liabilities:
  Bank indebtedness                                      957              -
  Accounts payable and accrued liabilities             4,837          5,339
  Dividends payable                                    1,055            963
  Income taxes payable                                     -            559
  Current portion of long-term debt                    2,700          1,502
  Current portion of finance leases                      282            314
----------------------------------------------------------------------------
                                                       9,831          8,677
----------------------------------------------------------------------------

Non-current liabilities:
  Long-term debt                                      20,475         14,801
  Obligation under finance leases                      3,980          4,106
  Deferred income taxes                                2,286          2,115
----------------------------------------------------------------------------
                                                      26,741         21,022
----------------------------------------------------------------------------

Total liabilities                                     36,572         29,699
----------------------------------------------------------------------------
Shareholders' equity
  Share capital                                       37,510         32,894
  Warrants                                               787            835
  Share purchase loans receivable                        (93)          (148)
  Contributed surplus                                    732            744
  Deficit                                             (5,511)        (5,234)
----------------------------------------------------------------------------
                                                      33,425         29,091
----------------------------------------------------------------------------
Total liabilities and shareholders' equity            69,997         58,790
----------------------------------------------------------------------------
----------------------------------------------------------------------------

See accompanying notes to the Condensed Consolidated Interim Financial Statements

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited) IN THOUSANDS OF CANADIAN DOLLARS


----------------------------------------------------------------------------
                                   Three months ended      Six months ended
                                  June 30,   June 30,   June 30,   June 30,
                                      2014       2013       2014       2013
----------------------------------------------------------------------------
Revenues                            10,014     10,065     22,439     21,538
----------------------------------------------------------------------------
Direct expenses
  Direct operating costs             5,166      6,535     10,627     12,026
  Cost of sales of equipment,
   fuel and parts                      941        471      2,416      1,363
  Depreciation of equipment          1,554      1,295      2,945      2,705
  --------------------------------------------------------------------------
                                     7,661      8,301     15,988     16,094
  --------------------------------------------------------------------------
  Gross margin                       2,353      1,764      6,451      5,444
  --------------------------------------------------------------------------
Other expenses
  General and administrative         1,324      1,218      2,808      2,592
  Depreciation of other property
   and equipment                        42         26         73         53
  Amortization of intangible
   assets                              235        251        485        502
  Business acquisition expenses         34          -         34         10
  Finance costs                        339        446        655        870
  --------------------------------------------------------------------------
                                     1,974      1,941      4,055      4,027
----------------------------------------------------------------------------
Income (loss) before income
 taxes                                 379       (177)     2,396      1,417
Income taxes (recovery)
Current                               (179)       (37)       452        540
Deferred                               301         (6)       198        (99)
----------------------------------------------------------------------------
                                       122        (43)       650        441
----------------------------------------------------------------------------
Net income (loss) and
 comprehensive income
for the period                         257       (134)     1,746        976
----------------------------------------------------------------------------
Net income (loss) per share
  Basic                               0.02      (0.01)      0.11       0.08
  Diluted                             0.02      (0.01)      0.11       0.08

Weighted average number of
 shares outstanding
  Basic                         16,629,850 11,671,096 16,362,058 11,671,096
  Diluted                       16,721,603 11,671,096 16,399,818 11,671,096

See accompanying notes to the Condensed Consolidated Interim Financial Statements

About CERF Incorporated

CERF Incorporated is a Canadian public corporation engaged in the rental, sale and service of industrial and construction equipment and waste management and environmental services. The Equipment Rental Segment includes the rental of residential, commercial and industrial construction-related equipment, including sales and service of equipment. It also includes the rental and sale of equipment to the drilling and service sectors of the oil and natural gas industry. The Waste Management Segment consists of complete waste facility management (six landfill sites in central Alberta) including waste facility design and construction services, recycling management and collection services, and consulting services. The Waste Management Segment also consists of waste removal and disposal from commercial, industrial and residential customers. CERF Incorporated trades on the TSXV under the symbol "CFL".

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.

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
"We view the cloud not really as a specific technology but as a way of doing business and that way of doing business is transforming the way software, infrastructure and services are being delivered to business," explained Matthew Rosen, CEO and Director at Fusion, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Redis is not only the fastest database, but it is the most popular among the new wave of databases running in containers. Redis speeds up just about every data interaction between your users or operational systems. In his session at 19th Cloud Expo, Dave Nielsen, Developer Advocate, Redis Labs, will share the functions and data structures used to solve everyday use cases that are driving Redis' popularity.
Aspose.Total for .NET is the most complete package of all file format APIs for .NET as offered by Aspose. It empowers developers to create, edit, render, print and convert between a wide range of popular document formats within any .NET, C#, ASP.NET and VB.NET applications. Aspose compiles all .NET APIs on a daily basis to ensure that it contains the most up to date versions of each of Aspose .NET APIs. If a new .NET API or a new version of existing APIs is released during the subscription peri...
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
"My role is working with customers, helping them go through this digital transformation. I spend a lot of time talking to banks, big industries, manufacturers working through how they are integrating and transforming their IT platforms and moving them forward," explained William Morrish, General Manager Product Sales at Interoute, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
To leverage Continuous Delivery, enterprises must consider impacts that span functional silos, as well as applications that touch older, slower moving components. Managing the many dependencies can cause slowdowns. See how to achieve continuous delivery in the enterprise.
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
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...
Security, data privacy, reliability, and regulatory compliance are critical factors when evaluating whether to move business applications from in-house, client-hosted environments to a cloud platform. Quality assurance plays a vital role in ensuring that the appropriate level of risk assessment, verification, and validation takes place to ensure business continuity during the migration to a new cloud platform.
Extracting business value from Internet of Things (IoT) data doesn’t happen overnight. There are several requirements that must be satisfied, including IoT device enablement, data analysis, real-time detection of complex events and automated orchestration of actions. Unfortunately, too many companies fall short in achieving their business goals by implementing incomplete solutions or not focusing on tangible use cases. In his general session at @ThingsExpo, Dave McCarthy, Director of Products...
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, discussed the importance of WebRTC and how it enables companies to focus...
Security, data privacy, reliability and regulatory compliance are critical factors when evaluating whether to move business applications from in-house client hosted environments to a cloud platform. In her session at 18th Cloud Expo, Vandana Viswanathan, Associate Director at Cognizant, In this session, will provide an orientation to the five stages required to implement a cloud hosted solution validation strategy.
UpGuard has become a member of the Center for Internet Security (CIS), and will continue to help businesses expand visibility into their cyber risk by providing hardening benchmarks to all customers. By incorporating these benchmarks, UpGuard's CSTAR solution builds on its lead in providing the most complete assessment of both internal and external cyber risk. CIS benchmarks are a widely accepted set of hardening guidelines that have been publicly available for years. Numerous solutions exist t...
Up until last year, enterprises that were looking into cloud services usually undertook a long-term pilot with one of the large cloud providers, running test and dev workloads in the cloud. With cloud’s transition to mainstream adoption in 2015, and with enterprises migrating more and more workloads into the cloud and in between public and private environments, the single-provider approach must be revisited. In his session at 18th Cloud Expo, Yoav Mor, multi-cloud solution evangelist at Cloudy...
A critical component of any IoT project is what to do with all the data being generated. This data needs to be captured, processed, structured, and stored in a way to facilitate different kinds of queries. Traditional data warehouse and analytical systems are mature technologies that can be used to handle certain kinds of queries, but they are not always well suited to many problems, particularly when there is a need for real-time insights.