Aveda Transportation and Energy Services Announces Record Revenue, EBITDA and Net Income for the Second Quarter of 2013 and t...

Aveda Transportation and Energy Services Inc. (TSX VENTURE:AVE) ("Aveda" or the
"Company"), a leading provider of oilfield hauling services and equipment
rentals to the energy industry, today announced record revenue, Adjusted
EBITDA(1) and net income for the six and three months ended June 30, 2013.




2013 Second Quarter Business Highlights

--  Revenue for the three months ended June 30, 2013 grew by $2.2 million
    to $20.0 million, compared with revenue of $17.8 million for the same
    period in 2012; 
--  Reported 13 consecutive quarters of record revenue growth as compared
    to the same period of the prior year; 
--  Generated net income for the three months ended June 30, 2013 of $0.4
    million, an increase of $1.2 million compared to a $0.8 million loss
    for the same period in 2012. Net income per share increased to $0.04
    compared to a loss per share of $0.10 in the comparative period; 
--  Increased Adjusted EBITDA(1) by 122.4% to $3.2 million in the second
    quarter of 2013 as compared to $1.4 million in the same period of 2012;
    and 
--  The Company's solid EBITDA results and positive cash flow generation
    reduced bank debt by $4.4 million in the three months ended June 30,
    2013. 

2013 First Half Business Highlights

--  Revenue for the six months ended June 30, 2013 grew by $3.1 million to
    $43.5 million, compared with revenue of $40.4 million for the same
    period in 2012. Aveda achieved this revenue growth despite an average
    year-over-year rig count decline of approximately 10% in the areas the
    Company operates in; 
--  Generated net income for the six months ended June 30, 2013 of $2.1
    million, an increase of $2.4 million compared to a $0.3 million loss
    for the same period in 2012. Net income per share increased to $0.21
    compared to a loss per share of $0.04 in the comparative period; 
--  Generated Adjusted EBITDA(1) for the six months ended June 30, 2013 of
    $7.5 million, an increase of $3.1 million compared with Adjusted
    EBITDA(1) of $4.3 million for the same period in 2012, an increase of
    72% year over year; 
--  Generated net cash provided by operating activities for the six months
    ended June 30, 2013 of $8.6 million, an increase of $3.4 million
    compared to $5.2 million for the same period in 2012; 
--  Repaid loans and borrowing of $7.8 million in the six months ended June
    30, 2013; and 
--  Relocated the Company's Pennsylvania branch from New Columbia to
    Williamsport, Pennsylvania. 



In addition, the Company is pleased to announce the opening of a satellite
branch in Buckhannon, WV which will focus on rig moving in the Utica Shale play.
There are currently 69 drilling rigs operating within a 100 mile radius of
Aveda's new location. The Buckhannon branch will operate as an extension of
Aveda's Williamsport, PA branch with minimal impact to overhead costs.


"I am very pleased with our ability to continue to deliver solid results," said
Kevin Roycraft, President and Chief Executive Officer of Aveda. "I am also
extremely excited about the opening of our new satellite branch in West
Virginia. I am confident that this branch will contribute positive results in
the fourth quarter of 2013."


The Company also announces that Martin Cheyne has for personal reasons tendered
his resignation from Aveda's board of directors. The Company thanks Mr. Cheyne
for his significant contributions to our successes over the years.


Aveda will host its second quarter fiscal 2013 results conference call on
Thursday, August 15 at 9:00 a.m. Eastern Time (ET). Executive Chairman David
Werklund, President and CEO Kevin Roycraft and Vice-President, Finance and CFO
Bharat Mahajan will discuss Aveda's financial results for the quarter and then
take questions from securities analysts.


To access the conference call by telephone, dial [phone] or (888)
231-8191. A live audio webcast of the conference call will be available at
http://www.newswire.ca/en/webcast/detail/1202119/1318239.


The conference call webcast will be archived and available at
http://www.avedaenergy.com/investors/Conference-Calls/default.aspx until
September 30, 2013.


The Company's consolidated financial statements and Management's Discussion and
Analysis are available on the Company's website at www.avedaenergy.com or the
SEDAR website at www.sedar.com.




Financial Overview

(in thousands, except per share and ratio amounts)                         
                                                                           
                                Six     Six           Three   Three        
                             Months  Months          Months  Months        
                              Ended   Ended       %   Ended   Ended       %
                               June    June  Change    June    June  Change
                                 30,     30,   2012-     30,     30,   2012-
                               2013    2012    2013    2013    2012    2013
                           ------------------------------------------------
Revenue                      43,495  40,380    7.7%  20,024  17,780   12.6%
Gross profit(4)               8,836   7,104   24.4%   3,977   2,815   41.3%
Gross margin                  20.3%   17.6%   15.5%   19.9%   15.8%     N/A
Gross profit(4) excluding                                                  
 depreciation and                                                          
 amortization                12,763   9,777   30.5%   5,922   4,223   40.2%
Gross margin excluding                                                     
 depreciation and                                                          
 amortization                 29.3%   24.2%     N/A   29.6%   23.8%     N/A
Adjusted EBITDA(1)            7,467   4,345   71.9%   3,161   1,421  122.4%
Adjusted EBITDA(1) as a                                                    
 percentage of revenue        17.2%   10.8%   59.5%   15.8%    8.0%     N/A
Net income (loss)             2,123    (330) 743.3%     400    (770) 151.9%
Net income (loss) as a                                                     
 percentage of revenue         4.9%   -0.8%     N/A    2.0%   -4.3%     N/A
Adjusted EBITDA(1) per                                                     
 share                         0.75    0.58   29.3%    0.32    0.19   68.8%
Earnings per share - basic     0.21   (0.04) 625.0%    0.04   (0.10) 140.0%
Earnings per share -                                                       
 diluted                       0.20   (0.04) 600.0%    0.04   (0.10) 140.0%
Current ratio                  2.01    2.10   -4.1%    2.01    2.10   -4.1%
Debt to equity ratio(2)        0.94    0.89    5.3%    0.94    0.89    5.3%
Debt to EBITDA ratio(2)(3)     1.98    2.24  -11.8%    1.98    2.24  -11.8%
                                                                           
Notes:                                                                     
(1) This News Release contains the term Adjusted EBITDA. Adjusted EBITDA as
 presented does not have any standardized meaning prescribed by            
 international financial reporting standards (IFRS) and therefore it may   
 not be comparable with the calculation of similar measures for other      
 entities. Management uses Adjusted EBITDA to analyze the operating        
 performance of the business. Adjusted EBITDA as presented is not intended 
 to represent cash provided by operating activities, net earnings or other 
 measures of financial performance calculated in accordance with IFRS. It  
 is defined as earnings before interest, taxes, depreciation and           
 amortization excluding foreign exchange gains or losses which are         
 primarily related to the US dollar activities of the Company and can vary 
 significantly depending on exchange rate fluctuations, which are beyond   
 the control of the Company, and write downs of intangible assets, goodwill
 impairment, financing costs, gains or losses on disposal of assets, stock 
 based compensation, fees and expenses on settlement of debt and losses on 
 extinguishment of debt.                                                   
(2) Debt includes, revolving credit facility, loans and borrowings,        
 obligations under finance lease and convertible debenture as per their    
 carrying amounts on the balance sheet.                                    
(3) EBITDA used is Adjusted EBITDA for the trailing 12 months.             
(4) Gross profit calculated as revenue less direct operating expense.      



Outlook

The Company earns revenue primarily by providing specialized transportation
services to companies engaged in exploration, development and production of
petroleum resources. Demand for the Company's transportation services is
therefore linked to the economic conditions of the energy industry and the
general level of drilling activity in the exploration, development and
production of petroleum resources in Western Canada and in the United States.
Drilling activity in the WCSB and in the United States has in recent history
been affected by amongst other things, low natural gas prices and higher than
normal natural gas inventories in storage caused by many factors, including
reduced demand for commodities as a consequence of a global recession and the
temporary oversupply of natural gas due to the fast development of shale gas
resources in the United States.


Countering these factors is a strong price for oil, which has allowed
oil-focused regions such as areas surrounding the Company's Pleasanton and
Midland, TX branches to experience robust rig counts. In the second quarter of
2013, oil prices showed a strong recovery compared to the first quarter, with
WTI reaching $106/bbl(1), much better than the previously expected $90/bbl(2).


In Canada, the second quarter of 2013 showed rig counts akin to historical
pattern up to the end of May(3), while June showed a slower recovery than the
previous years. With the end of the break-up season, early July rig counts have
been strong and are above the same month in 2012, but below 2011. This is in
line with the PSAC forecast of April 2013(4). Unfavourable conditions caused by
export capacity bottlenecks remain, with the province of Alberta appealing to
rail transportation as an outlet for its crude oil while a decision on major
pipeline projects is awaited(5). Large capital expenditure projects continue to
be challenged by the prevailing conditions, as exemplified by the late 2012
announcement of delays in large projects such as the Fort Hill and Joslyn oil
sands mines(6). Within WCSB gas plays, various companies have reduced capital
expenditure investments due to the low returns experienced from the exploration
and production of low-priced natural gas. Instead, these companies have shifted
their focus towards cautious investments in liquids-rich plays, divesting from
dry gas assets and reducing overall capital expenditure in expectation of market
improvements(7).


Canada in 2013 as a whole remains uncertain due to the market conditions
described, including the risk of additional delays or cancellations in major
upstream projects in Canada and continually depressed natural gas prices.
However, a more optimistic outlook has been expressed by major players
represented by the PSAC, supported by encouraging early rig counts coming out of
the break-up season, but it remains to be seen whether such expectations will
come to fruition.


Opportunities for expansion and growth continue to appear strongest in the US.
According to the Baker Hughes Rig Count(8), drilling activity in the Eagleford
and Permian basins remains close to the highest levels experienced in the last
10 years, although in both basins, rig counts in July 2013 appear to have
stabilized 8% lower than the same period in 2012. Rig counts remain, however, at
very high levels compared to previous years, and the slight decline shown is not
expected to represent any significant reduction in Aveda's activity levels in
these regions due to increase in rig efficiency resulting in more frequent rig
moves. The high activity levels experienced have allowed Aveda to grow
significantly in these areas, with the opening of two new branches (Pleasanton
and Midland) in 2012. The Midland branch continues to increase its activities as
it is established within the Permian Basin client base. The terminal is showing
strong month over month growth in 2013. In contrast, the Mineral Wells branch
has faced a significant decline in rig counts in the Dallas/Ft. Worth Basin
(Barnett Shale play), and is working to maximize revenue and EBITDA by focusing
efforts at acquiring new customers in higher activity, liquids-rich areas to the
north.


(1) Bloomberg Energy and Oil Prices, found at http://www.bloomberg.com/energy/
and accessed on July 10, 2013


(2) Petroleum Services Association of Canada, Drilling Activity Forecast Update,
April 25 2013


(3) CAODC Statistics, accessed on July 10, 2013 at www.caodc.ca

(4) Petroleum Services Association of Canada, Drilling Activity Forecast Update,
April 25 2013


(5) According to the Canadian Association of Oil Producers, cited at Profiler
Magazine, June 2013 edition, page 11. ISSN 1204-4741


(6)
http://www.theglobeandmail.com/globe-investor/suncor-joins-spending-retreat/article4813907/


(7)
http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/encana-puts-brakes-on-liquids-plays/article8656404/


(8) Baker Hughes Rig Count, accessed on July 10, 2013, at
http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm


Pennsylvania is also facing significant declines in rig counts in the
surrounding area. The declining rig counts have created significant downward
price pressure due to fierce competitive environment and a shrinking market
size. It is expected that rig counts will continue a slow downward trend in
Pennsylvania gas plays. However, the Company has continued to maintain solid
revenues out of its Pennsylvania branch as this branch has been servicing
customers in the Utica Shale play in addition to its traditional customer base
in the Marcellus. The solid demand in the Utica Shale play has led the Company
to expand its operations by opening a satellite branch in Buckhannon, WV. This
branch is being run and managed by Aveda's Pennsylvania team, as such, the
expansion is being undertaken with minimal impact to overhead costs.


Aveda has recently experienced increases in quoting activity levels across its
rig moving branches and is also seeing a greater willingness by customers to
enter into master service agreements. With the expansion of the Company's
operations into Buckhannon, and generally higher customer quoting activity
levels, Aveda is increasing its planned capital expenditure to $4.0 - $5.0
million in 2013.


About Aveda Transportation and Energy Services

Aveda provides specialized transportation of products, materials, supplies and
equipment required for the exploration, development and production of petroleum
resources in the Western Canadian Sedimentary Basin and in the United States of
America principally in and around the states of Texas and Pennsylvania.
Transportation services include both the equipment necessary to move the load as
well as a trained, professional driver capable of securing, moving and
manipulating the load at its origin and destination. Aveda's rental operations
include the rental of tanks, mats, pickers, light towers and other equipment
necessary for oilfield operations.


Aveda was incorporated in 1994 as a private company to serve the oil and gas
industry. In the spring of 2006 the Company went public on the TSX Venture
Exchange. Aveda has major operations in Calgary, AB, Slave Lake, AB, Leduc, AB,
Sylvan Lake, AB Mineral Wells, TX, Pleasanton, TX, Midland, TX, Williamsport, PA
and Buckhannon, WV. Aveda is publicly traded on the TSX Venture Exchange under
the symbol AVE. For more information on Aveda please visit www.avedaenergy.com.


This News Release contains certain forward-looking statements and
forward-looking information (collectively referred to herein as "forward-looking
statements") within the meaning of applicable Canadian securities laws. All
statements other than statements of present or historical fact are
forward-looking statements. Forward-looking statements are often, but not
always, identified by the use of words such as "anticipate", "achieve", "could",
"believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate",
"outlook", "expect", "may", "will", "project", "should" or similar words,
including negatives thereof, suggesting future outcomes. In particular, this
News Release contains forward-looking statements relating to: demand for the
Company's services and general industry activity level; the Company's growth
opportunities; and expectation to maintain revenue and equipment utilization.
Aveda believes the expectations reflected in such forward-looking statements are
reasonable as of the date hereof but no assurance can be given that these
expectations will prove to be correct and such forward-looking statements should
not be unduly relied upon.


Various material factors and assumptions are typically applied in drawing
conclusions or making the forecasts or projections set out in forward-looking
statements. Those material factors and assumptions are based on information
currently available to Aveda, including information obtained from third party
industry analysts and other third party sources. In some instances, material
assumptions and material factors are presented elsewhere in this News Release in
connection with the forward-looking statements. Readers are cautioned that the
following list of material factors and assumptions is not exhaustive. Specific
material factors and assumptions include, but are not limited to:




--  the performance of Aveda's businesses, including current business and
    economic trends; 
--  oil and natural gas commodity prices and production levels; 
--  the effect of the rebranding on Aveda's businesses; 
--  capital expenditure programs and other expenditures by Aveda and its
    customers: 
--  the ability of Aveda to retain and hire qualified personnel; 
--  the ability of Aveda to obtain parts, consumables, equipment,
    technology, and supplies in a timely manner to carry out its activities;
--  the ability of Aveda to maintain good working relationships with key
    suppliers; 
--  the ability of Aveda to market its services successfully to existing and
    new customers; 
--  the ability of Aveda to obtain timely financing on acceptable terms; 
--  currency exchange and interest rates; 
--  risks associated with foreign operations; 
--  changes under governmental regulatory regimes and tax, environmental and
    other laws in Canada and the United States; and 
--  a stable competitive environment. 



Forward-looking statements are not a guarantee of future performance and involve
a number of risks and uncertainties, some of which are described herein. Such
forward-looking statements necessarily involve known and unknown risks and
uncertainties, which may cause Aveda's actual performance and financial results
in future periods to differ materially from any projections of future
performance or results expressed or implied by such forward-looking statements.
These risks and uncertainties include, but are not limited to, the risks
identified in Aveda's annual information form and management discussion and
analysis for the year ended December 31, 2012 (the "MD&A"). Any forward-looking
statements are made as of the date hereof and, except as required by law, Aveda
assumes no obligation to publicly update or revise such statements to reflect
new information, subsequent or otherwise.


This News Release contains the terms EBITDA and Adjusted EBITDA which are
defined in the MD&A. EBITDA and Adjusted EBITDA as presented do not have any
standardized meaning prescribed by international financial reporting standards
(IFRS) and therefore may not be comparable with the calculation of similar
measures for other entities. Management uses Adjusted EBITDA to analyze the
operating performance of the business. Adjusted EBITDA as presented is not
intended to represent cash provided by operating activities, net earnings or
other measures of financial performance calculated in accordance with IFRS.


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.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Aveda Transportation and Energy Services Inc.
Bharat Mahajan, CA
Vice President, Finance and Chief Financial Officer
[phone]
[e-mail]
www.avedaenergy.com