AKITA Drilling Ltd. Announces Record Third Quarter and Nine Month Results
CALGARY, ALBERTA, October 20, 2006 –AKITA Drilling Ltd.’s net earnings for the nine months ended September 30, 2005 were a record $19,688,000 or $1.06 per share on revenue of $115,469,000. Comparative figures for 2004 were $14,181,000 or $0.79 per share on revenue of $97,782,000. Cash flow from operations for the period was $29,834,000 compared to $24,346,000 in 2004.
Earnings for the three months ended September 30, 2005 were a record $7,108,000 ($0.38 per share) on revenue of $40,740,000 compared with $3,784,000 ($0.21 per share) on revenue of $29,600,000 in 2004. Cash flow from operations for the quarter ended September 30, 2005 was $10,319,000 compared to $6,950,000 in the corresponding quarter in 2004.
All per share amounts have been retroactively restated to reflect the impact of the Company’s two-for-one share split implemented on June 8, 2005.
The Company recorded a record number of drilling days during the third quarter. Strong market conditions as a result of currently high oil and gas prices more than offset the negative effects of wet weather on rig movements. Improved dayrates in the current year have also added to AKITA’s strong performance. During the first nine months of 2005, the Company drilled 1,022 wells and achieved 5,793 operating days. This represented 57% utilization for the period. A total of 1, 016 wells were drilled over 5,154 operating days in the corresponding period in 2004, which represented 52% utilization.
Management continues to focus on seeking opportunities that meet the Company’s current strengths in the North and in heavy oil. As well, the Company is interested in exploring ways to enhance the opportunities for its well servicing operations.
Financial results for the third quarter are as follows:
Statement of Earnings and
Retained Earnings
Unaudited ($000's except per share amounts)
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Three Months Nine Months
Ended Ended
September 30 September 30
2005 2004 2005 2004
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REVENUE $ 40,740 $ 29,600 $ 115,469 $ 97,782
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EXPENSES
Operating and maintenance 23,281 18,120 66,231 57,569
Depreciation 2,760 2,671 9,201 8,655
Selling and administrative 4,107 3,068 11,246 9,905
---------- ---------- ---------- ----------
30,148 23,859 86,678 76,129
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Operating income 10,592 5,741 28,791 21,653
OTHER INCOME (EXPENSE)
Interest on long-term debt (22) (126) (128) (527)
Interest income 330 173 876 607
Gain on sale of joint
venture interests in rigs
and other capital assets 36 77 750 253
---------- ---------- ---------- ----------
344 124 1,498 333
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EARNINGS BEFORE INCOME TAXES 10,936 5,865 30,289 21,986
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INCOME TAXES
Current 3,428 1,608 9,167 6,341
Future 400 473 1,434 1,464
---------- ---------- ---------- ----------
3,828 2,081 10,601 7,805
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NET EARNINGS 7,108 3,784 19,688 14,181
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Retained earnings,
beginning of period 110,614 93,132 100,871 84,602
Dividends (1,021) (903) (3,069) (2,709)
Adjustment on repurchase and
cancellation of share capital (549) (623) (1,338) (684)
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RETAINED EARNINGS,
END OF PERIOD $ 116,152 $ 95,390 $ 116,152 $ 95,390
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EARNINGS PER CLASS A AND
CLASS B SHARE
Basic $ 0.38 $ 0.21 $ 1.06 $ 0.79
Diluted $ 0.38 $ 0.20 $ 1.05 $ 0.76
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Statement of Cash Flows
Unaudited ($000's)
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Three Months Nine Months
Ended Ended
September 30 September 30
2005 2004 2005 2004
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OPERATING ACTIVITIES
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Net earnings $ 7,108 $ 3,784 $ 19,688 $ 14,181
Non-cash items included in
earnings
Depreciation 2,760 2,671 9,201 8,655
Future income taxes 400 473 1,434 1,464
Expense for defined benefit
pension plan 63 60 189 180
Amortization of preferred
share discount - 18 - 56
Stock options charged to
expense 24 21 72 63
Gain on sale of joint
venture interests in rigs
and other capital assets (36) (77) (750) (253)
---------- ---------- ---------- ----------
Cash flow from operations 10,319 6,950 29,834 24,346
Change in non-cash working
capital (7,222) (5,068) 2,355 (1,167)
---------- ---------- ---------- ----------
3,097 1,882 32,189 23,179
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INVESTING ACTIVITIES
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Capital expenditures (6,059) (4,733) (11,957) (10,649)
Proceeds on sales of joint
venture interests in rigs
and other capital assets 163 205 1,818 712
Change in non-cash working
capital 55 340 107 (987)
---------- ---------- ---------- ----------
(5,841) (4,188) (10,032) (10,924)
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FINANCING ACTIVITIES
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Repayment of long-term debt (1,044) (1,351) (3,856) (3,994)
Dividends (1,021) (903) (3,069) (2,709)
Issue of share capital - - - 70
Repurchase of share capital (589) (678) (1,449) (744)
Change in non-cash working
capital (5) (8) 85 -
---------- ---------- ---------- ----------
(2,659) (2,940) (8,289) (7,377)
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INCREASE IN CASH (5,403) (5,246) 13,868 4,878
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Cash position, beginning of
period 46,723 38,030 27,452 27,906
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CASH POSITION, END OF PERIOD $ 41,320 $ 32,784 $ 41,320 $ 32,784
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Interest paid during period $ 15 $ 152 $ 109 $ 523
Income taxes paid during
period $ 2,333 $ 1,994 $ 7,716 $ 9,441
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Balance Sheet
Unaudited ($000's)
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September 30 December 31
2005 2004 2004
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ASSETS
Current assets
Cash $ 41,320 $ 32,784 $ 27,452
Accounts receivable 32,905 21,497 34,926
Other 586 2,394 104
---------- ---------- ----------
74,811 56,675 62,482
Investments 55 55 55
Capital assets 102,108 98,536 100,420
---------- ---------- ----------
$ 176,974 $ 155,266 $ 162,957
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LIABILITIES
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Current liabilities
Accounts payable and
accrued liabilities $ 16,127 $ 14,319 $ 16,570
Income tax payable 2,976 720 1,525
Current portion of
long-term debt 117 5,111 3,973
Current portion of
series preferred shares - 4,974 -
---------- ---------- ----------
19,220 25,124 2 2,068
Long-term debt - 235 -
Future income tax 14,547 12,666 13,113
Pension liability 3,039 2,790 2,850
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CLASS A AND CLASS B
SHAREHOLDERS' EQUITY
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Preferred shares - 228 -
Class A and Class B shares 23,558 18,697 23,669
Contributed surplus 458 136 386
Retained earnings 116,152 95,390 100,871
---------- ---------- ----------
140,168 114,451 124,926
---------- ---------- ----------
$ 176,974 $ 155,266 $ 162,957
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AKITA is an Alberta company engaged in the contract drilling business. AKITA's Class A Non-Voting Shares and Class B Common Shares are listed on the Toronto Stock Exchange under the symbol "AKT.NV.A." and "AKT.B"; respectively.
For further information please contact Murray Roth, Vice President of Finance,
(403)292-7950. Web site: http://www.akita-drilling.com |
