EANS-News: C.A.T. oil made solid progress in business expansion and diversification in 2011
30.04.2012 – 08:31
-------------------------------------------------------------------------------- Corporate news transmitted by euro adhoc. The issuer/originator is solely responsible for the content of this announcement. -------------------------------------------------------------------------------- annual result Subtitle: All-time-high in operating activity levels in FY 2011 Revenue target exceeded with revenues up 22.7% yoy to EUR 280.7 million EBITDA of EUR 54.6 million and EBITDA margin of 19.5%, reflect business expansion and temporary cost effects The new high class conventional drilling services will contribute to further growth in 2012 Proposed dividend increase to EUR 0.125 per share Vienna, 30 April 2011 (euro adhoc) - C.A.T. oil AG (O2C, ISIN: AT0000A00Y78), one of the leading providers of oil and gas field services in Russia and Kazakhstan, today announced its results for the Fiscal Year 2011. C.A.T. oil boosted its revenues by 22.7% yoy to EUR 280.7 million (FY 2010: 228.8 million) thereby successfully exceeding its objective of EUR 260-270 million. The strong development was based on a very healthy demand and supportive macroeconomic dynamics in Russia and Kazakhstan. In 2011, C.A.T. oil not only expanded its existing businesses but also consequently executed the set up of high class conventional drilling as third core service line. Despite front-up costs related to the business expansion, the Company continued to operate on a high level. Manfred Kastner, CEO of C.A.T. oil, commented: "Fiscal Year 2011 represents an important milestone in our history. Although global economies slowed down throughout the year, we were able to successfully grow our traditional business: We pushed our total job count to a new record-high of 3,366 jobs and exceeded our revenue target with revenues of EUR 280.7 million. At the same time we very efficiently expanded into high class conventional drilling. We thus leverage our existing strength and know-how to set the basis for additional profitable growth." "By the end of April, we had obtained service orders for 80% of our new drilling capacities for 2012. Our talks with customers for deployment of the remaining 20% are at the completion stage. This development clearly demonstrates two of our key strengths: on the one hand our ability to understand the markets and our customers' needs and on the other, our strong reputation for delivering top-in-class services based on state-of-the-art technology." All-time-high in total job count and revenues In Fiscal Year 2011 C.A.T. oil recorded a strong revenue boost backed by two effects: Firstly, an increase of 11.7 % yoy to 3,366 jobs (FY 2010: 3,014 jobs) with fracturing and sidetrack drilling operations going up 15.9% yoy and 7.8% yoy, respectively. Secondly, a strong upturn in the average per job revenue to TEUR 82.9, up 10.2% yoy (FY 2010: TEUR 75.2). Cost base influenced by high operating activity levels, greater size and complexity of jobs and front-loaded costs In 2011 cost of sales rose by 30.1% yoy to EUR 242.8 million (FY 2010: EUR 186.7 million), reflecting four aspects: front-loaded costs related to the business expansion, high operating activity levels, the increased share of more complex horizontal sidetracks and slower than expected sidetrack drilling operations in Q1 and Q4. As part of the 2011-12 investment program of EUR 150 million, C.A.T. oil set up high class conventional drilling: The first conventional drilling rig has already been in operation since Q3 2011. The remaining eight rigs were shipped to Russia and adapted for operations during H2. In addition, two more sidetrack drilling rigs were added to the portfolio, bringing the total number of those particular rigs to 17. General and administrative expenses increased by 7.1% yoy to EUR 19.5 million in FY 2011 (FY10 2010: EUR 18.2 million) primarily driven by the costs related to the expansion of the business. The total weighted average headcount went down by 2.6% yoy to 2,360 employees in FY 2011 (FY 2010: 2,424 employees) and reflect a reduction of staff due to the outsourced workover, as well as new hires for the new business line. Competitive EBITDA margin of 19.5% despite business expansion Earnings before interest, tax and depreciation (EBITDA) slightly decreased by 3.2% yoy to EUR 54.6 million in 2011 (FY 2010: EUR 56.4 million). This mainly reflects the higher cost base due to the business diversification, setbacks in the sidetracking performance in Q1 and Q4 as well as a one-off effect in the amount of EUR 2.1 million for provisions for long-term and current receivables in Q4. Despite these effects C.A.T. oil continued to deliver a very competitive EBITDA margin of 19.5% (FY 2010: 24.7%). The Company's earnings before interest and tax (EBIT) diminished 39.6% yoy to EUR 16.6 million in 2011 (FY 2010: EUR 27.5 million), reflecting the lower EBITDA and higher depreciation expense on investments in the new operating capacities. Net income came in at EUR 6.8 million in 2011 (FY 2010: EUR 19.5 million) primarily owing to lower operating profit and net financial result. Cash flow driven by business expansion Funds from operations decreased by 4.1% yoy to EUR 46.4 million (FY 2010: EUR 48.3 million) primarily reflecting the combined effect of lower pre-tax profit and higher depreciation. Cash flow from operating activities was a net inflow of EUR 29.8 million (FY 2010: net inflow of EUR 59.2 million) due to lower funds from operations and the higher net working capital which was driven by business expansion. Capital expenditure rose 155.3% yoy to EUR 110.6 million (FY 2010: EUR 43.3 million) primarily due to successful execution of the investment plan. Cash flow from investing activities was a net outflow of EUR 108.0 million (FY 2010: net outflow of EUR 39.7 million). Cash flow from financing activities was a net inflow of EUR 73.7 million in 2011 (FY 2010: net outflow of EUR 13.3 million) mainly due to an increase in long-term borrowings for investment purposes. As of 31 December 2011, cash and cash equivalents stood at EUR 30.4 million (31 December 2010: EUR 34.1 million). C.A.T. oil's equity ratio remained at a comfortable level of 62.3% as of 31 December 2011 (31 December 2010: 83.2%). Dividend proposal of EUR 0.125 per share At the AGM on June 15, 2012 the Management and the Supervisory Boards will propose to increase the dividend by 25% yoy to EUR 0.125 per share for Fiscal Year 2011. This represents a profit distribution of 90%. Confident outlook for FY 2012 Despite ongoing uncertainties regarding the global economic prospects for 2012, C.A.T. oil is confident in a positive outlook for the current Fiscal Year. The global oil demand is expected to remain strong and the oil price is likely to stay at a high level. Moreover, in oil and gas producers in Russia and Kazakhstan have increased their upstream activities and investment plans since late 2011. These factors will have a positive effect on demand and support C.A.T. oil's growth: At the end of April, C.A.T. oil's 2012 order book, which comprises of orders for fracturing, sidetrack drilling and conventional drilling, improved 27% yoy to EUR 284 million (based on a rouble-to-euro exchange rate of 40). The new conventional drilling capacity is expected to make first positive contributions to revenues and earnings during the current year. Manfred Kastner said: "With our diversified service portfolio we are in an even stronger position to exploit market opportunities. With our experienced teams and state-of-the-art technology we will be able to assist our customers to efficiently produce oil wells and deliver exactly the services they need. We are thus very well positioned for another year of profitable growth". www.catoilag.com Press contact: FTI Consulting Carolin Amann Phone: +49 (0)69 92037-132 Email: carolin.amann@fticonsulting.com Thomas M. Krammer Phone: +49 (0)69 92037-183 Email: thomas.krammer@fticonsulting.com About C.A.T. oil AG: C.A.T. oil AG is one of the leading providers of oil and gas field services in Russia and Kazakhstan and is listed on the Frankfurt Stock Exchange (SDAX). C.A.T. oil offers a wide spectrum of services to increase the lifecycle of an oil field or to make unexploited oil fields accessible. The Company's growth is driven by the following factors: Existing oil fields need to be stimulated due to shrinking oil and gas resources in order to optimize capacities. Simultaneously, idle wells are reactivated or made accessible through new methods in order to deploy wells to their maximum. Additionally, C.A.T. oil has established conventional drilling as third core service which allows to activate completely unexploited oil and gas sources. Since its foundation in 1991 in Celle, Germany, C.A.T. oil has built up a leading hydraulic fracturing services business in Russia and Kazakhstan. Following its IPO in 2006 the Company has invested more than EUR 250 million in additional services and capacities: sidetrack drilling has become the Company's second core business. In November 2010, the Company introduced a comprehensive investment program with a volume of EUR 150 million which has mainly been used to set up conventional drilling as part of the Company's service portfolio. Furthermore, C.A.T. oil offers cementing and seismic services. Due to the recent investments C.A.T. oil's fleets and rigs are state-of-the-art and therefore allow for time-efficient and effective deployment. C.A.T. oil's customer base includes the leading Russian and Kazakh oil and gas producers amongst them Gazprom, KazMunaiGaz, LUKOIL, Rosneft and TNK-BP. C.A.T. oil has a long-standing relationship with these customers and has been a reliable service provider since its market entrance in the early nineties. The Company has its headquarters in Vienna. From January to December 2011, the Company employed an average of 2,360 people, most of which are based in Russia and Kazakhstan. Key financial figures for FY 2011 [million EUR] FY 2011 FY 2010 Change in % Revenues 280.7 228.8 22.7 Cost of sales 242.8 186.7 30.1 Gross profit 37.9 42.1 -10.0 EBITDA 54.6 56.4 -3.2 EBITDA margin (%) 19.5 24.7 EBIT 16.6 27.5 -39.6 EBIT margin (%) 5.9 12.0 Net income 6.8 19.5 -65.3 Earnings per share (EUR) 0.138 0.399 -65.3 Equity Ratio (%)* 62.3 83.2 Cash flow from operating activities 29.8 59.2 -49.8 Cash flow from investing activities -108.0 -39.7 >100 Cash flow from financing activities 73.7 -13.3 >100 Cash and cash equivalents* 30.4 34.1 -11.0 Total job count 3,366 3,014 11.7 Per-job revenue (thou. EUR) 82.9 75.2 10.2 Employees 2,360 2,424 -2.6 *As of 31 December 2011 and 31 December 2010 respectively Key financial figures for Q4 2011 [million EUR] Q4 2011 Q4 2010 Change in % Revenues 71.0 55.0 29.2 Cost of sales 65.4 46.9 42.2 Gross profit 5.6 9.0 -37.5 EBITDA 8.7 13.0 -33.0 EBITDA margin (%) 12.2 23.6 EBIT -2.0 5.9 >-100 EBIT margin (%) -2.8 10.7 Net income -5.9 3.3 >-100 Earnings per share (EUR) -0.120 0.067 >-100 Cash flow from operating activities -0.4 14.2 >-100 Cash flow from investing activities -26.2 -14.8 76.6 Cash flow from financing activities 21.5 -0.4 >100 Total job count 788 759 3.7 Per-job revenue (thou. EUR) 89.0 72.0 23.6 Further inquiry note: Thomas M. Krammer Tel: +49(0)69-92037-183 Email: thomas.krammer@fticonsulting.com end of announcement euro adhoc -------------------------------------------------------------------------------- company: C.A.T. oil AG Kärtner Ring 11-13 A-A-1010 Wien phone: +43(0) 1 535 23 20 - 0 FAX: +43(0) 1 535 23 20 - 20 mail: ir@catoilag.com WWW: http://www.catoilag.com sector: Oil & Gas - Upstream activities ISIN: AT0000A00Y78 indexes: SDAX, Classic All Share, Prime All Share stockmarkets: regulated dealing/prime standard: Frankfurt language: English