Business
Western Energy Services Corp. Announces Q1 Results
Western Energy Services Corp. Announces Q1 Results.
About this update from Western Energy Services Corp.
[{"type":"text","content":"\n\n\n\n/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES/\n\n\nCALGARY, May 30 /CNW/ - Revenues increased by 42% from the fourth quarter\nof 2006 to $5,251,618. Income from continuing operations before amortization,\ninterest and income taxes ("EBITDA") increased by $1,391,081 from Q4, 2006 to\na positive $668,796. Adding back the non cash stock compensation expense to\nEBITDA results in $866,181 or 16.5% of revenue for the first quarter of 2007.\nNet loss was $423,493 for the quarter. General and administrative expenses\nwere 10.6% of revenues compared to 13.1% for the fourth quarter of 2006. Stock\nbased compensation recorded for the first quarter of 2007 of $197,385\nrepresents the value of the vested portion of currently granted options and\nthe vesting of options granted in prior years.\n\n\nThe new management team continued the implementation of the turnaround\nplan during the first quarter of 2007. The key components of the turnaround\nplan are: shifting the direction of the Company's business to the less\nvolatile production optimization through stimulation services; concentrating\nthe Company's services in fewer operational bases; increasing efficiencies and\nreducing costs. The Company's plan took a big step forward with the purchase\nof the assets of the Grenville Energy Partnership ("Grenville") and by\ndisposing of its non core well testing assets. Grenville has provided\nequipment financing to Western through a revenue sharing joint venture since\nJuly 2005.\n\n\nDuring the first quarter of 2007 the Company and Grenville negotiated an\nend to their joint venture and the purchase by the Company of all of\nGrenville's oilfield service equipment for $12.5 million. Commencing\nJanuary 1, 2007 the Company was no longer responsible to distribute a\ncomponent of its revenues to Grenville. This revenue savings will become\nsignificant as the Company's business grows. To complete the Grenville\npurchase the Company used approximately $4.2 million of a new banking\nfacility. This new demand term loan also funded the repayment of existing\ndemand term loans in the amount of $0.7 million and a revolving credit\nfacility in the amount of $1.5 million.\n\n\nAn 8% convertible note with a one year term was also issued to Grenville\non closing of the transaction, on May 16, 2007. The note is convertible into\nsha...