Winalta Announces Record Results for the First Quarter Ended March 31, 2012

    




 CALGARY, May 25, 2012 /CNW/ - Winalta Inc.  ("Winalta" or  the "Company") is pleased to announce record results for the three  months ended March 31, 2012 with net earnings from continuing  operations of $3.3 million or $0.08 per share fully diluted compared to  a net earnings from continuing operations of $1.6 million or $0.04 per  share fully diluted for the three months ended March 31, 2011. 

 Revenue of $9.0 million and EBITDA of $4.9 million compared favourably  to revenue of $7.2 million and EBITDA of $3.7 million for the  comparative 3 month period 2011. 

 Selected Financial Information 





                                           

                                                     Three Months Ended

    ($000,s except per share amounts)     March 31, 2012     March 31, 2011

    Revenue                                        8,986              7,210

    Net Earnings                                   3,325              1,566

    Earnings per share and diluted                  0.08               0.04
    earnings per share

    EBITDA                                         4,901              3,728

    EBITDAper share                                 0.12               0.09

    Total assets                                  44,529             40,910

    Total liabilities                             18,898             18,635

    Dividends                                          -                  -






  

 Revenue Winalta revenue increased by $1.8 million, an increase of 25% for the 3  months ended March 31, 2012 (the "Period") compared to the three months  ended March 31, 2011 (the "Comparative Period").  This 25% increase in  revenue year over year is attributable to increases in fleet size,  third party revenue and day rates. 

  





     

    Revenue Drivers Q1 2012 versus                                         
    Q1 2011

                                       % Increase     Q1 2012     Q1 2011  

                                                                           

    Fleet size (# of units)            9%             297         266      

    Utilization (during quarter)       -7%            85%         91%      






  

 Day rates for the period showed a year over year improvement of 12%. 

  

 Fleet Expansion During the Period the Company has increased its fleet size by 5 Wellsite  units and 4 Dedicated Geo-Lab units. Since the Comparative Period  Winalta has increased by 16 Wellsite units and 15 Dedicated Geo-Lab  units.  The Company continues to expand its fleet organically with cash  from operations. 

  





     

    Fleet Growth Q1 2012 versus Q1                                         
    2011

                                       % Increase     Q1 2012     Q1 2011  

                                                                           

    Wellsites                          7%             219         204      

    Drill Camps (5 and 6 units)        0%             11          11       

    Dedicated Geo Labs                 1500%          16          1        






  

 Utilization Utilization of Wellsite units for the Period was 85% as compared to 91%  for the Comparative Period. Utilization of Camp units for the Period  was 90% as compared to 91% for the Comparative Period.  Utilization of  Dedicated Geo-Labs for the Period was 87% as compared to 79% for the  Comparative Period, which shows continued demand for these specialty  units. 

 Decreased utilization for the Period over the Comparable Period can be  attributed to early spring weather in March which negatively affected  demand. 

  





     

    Utilization Q1 2012 versus Q1                                         
    2011

                                      % Increase     Q1 2012     Q1 2011  

     

    Wellsites                         -7%            85%         91%      

    Drill Camps (5 and 6 units)       -1%            90%         91%      

    Dedicated Geo Labs                13%            87%         79%      






  

 General and Administrative General and administrative expenses for the Period were 11% of revenue  as compared to 16% for the Comparative Period.  General and  administrative expenses improved by $187 thousand in the Period as  compared to Comparative Period due to decreases in professional fees,  wages, stock based compensation and travel expenses.  This represents  an improvement of 16% from the Comparative Period. 

 Depreciation and Amortization Depreciation and amortization was $1,217 for the Period as compared to  $1,202 for the Comparative Period.  The increase in depreciation and  amortization expense reflects the Company's depreciation and  amortization policy along with the acquisition of $1.4 million of  equipment in 2012. 

 Interest Expense Interest expense for the Period was $358 thousand as compared to $960  thousand for the Comparable Period.  The decrease in interest expense  in the Period is due to the new financing agreement the Company entered  into in January 2012.  In the Comparative Period, the interest rate on  the Company's term facility was 21% as compared to an interest rate on  the Company's new financing arrangements of 6% during the period.  The  Company expensed a deferred financing fee of $115 thousand in the  Period due to the renegotiated financing facility. 

 Outlook The Company continues to see strong fleet utilization and strengthening  rental rates, which combined with continued positive Western Canadian  economic activity, in both oil and gas exploration, should continue to  provide opportunities for the Company.  The Company believes the strong  economy will continue for the foreseeable future, as further supported  by the CAODC (Canadian Association of Oilwell Drilling Contractors)  forecast for the balance of 2012, which should translate to higher  utilization rates for Winalta's equipment.  In conjunction with the  expected strong demand, the Company is continuing to expand the fleet  of oilfield Wellsite units and Dedicated Geo-Labs in order to meet  demand and to maintain a relatively new fleet of units.  The additions  to the fleet will allow the Company to continue to support its customer  base in meeting their needs as well as expanding to new customers. 

 Winalta Inc., operating under the trade name, Winalta Oilfield Rentals,  is an oilfield service provider that specializes in portable industrial  rental accommodations, remote offices and Dedicated Geo Labs; servicing  the Western Canadian oil and gas Industry. 

 Neither the 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. 

 Forward-looking information Certain information set forth in this press release, including  management's assessment of the potential for increased cash flows,  continued growth of the Company's rental fleet, demand for the  Company's rental units and the Company's expectation regarding the  status of the economy and its impact on the Company, may constitute  forward-looking statements. By their nature, forward-looking statements  involve material assumptions and are subject to numerous risks and  uncertainties, including with respect to market and economic conditions  and their impact on the Company's business, some of which, are beyond  our control. Readers are cautioned not to place undue reliance on the  forward-looking statements as the assumptions used in the preparation  of such information, although considered reasonable at the time of  preparation, may prove to be imprecise and actual results, performance  or outcomes could materially differ from those expressed or implied in  such forward-looking statements and accordingly, no assurance can be  given that any of the events anticipated by forward looking statements  will transpire or occur, or if any of them do so, what benefit Winalta  will derive therefrom. The Company does not assume the obligation to  revise or update this forward-looking information after the date of  this release or to revise such information to reflect the occurrence of  future unanticipated events, except as may be required under applicable  securities laws. 

Winalta Inc.


CONTACT:  David Hopley, CFOPhone: [phone]Austin Fraser, Senior Vice PresidentPhone: (403) [e-mail] 


    

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