VAL-D'OR, QC', Nov. 12 /CNW/ -- Orbit Garant Drilling Inc. (TSX: OGD) today announced its financial results for the first quarter of fiscal 2010, ended September 30, 2009. All dollar amounts are in Canadian currency. Percentage calculations are based on numbers in the financial statements and may not correspond to rounded figures presented in this release.
Highlights
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3 Months ended 3 Months ended
CND $millions (except per share) Sept. 30, 2009 Sept. 30, 2008
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Revenue 24.4 23.1
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Gross Profit 8.0 7.5
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Gross Margin 32.8% 32.5%
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General & Administrative 1.8 1.6
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Amortization 2.4 1.9
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Normalized EBITDA 6.2 6.0
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Net Earnings 2.5 2.6
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Net earnings per common share
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- Basic 0.08 0.08
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- Diluted 0.08 0.08
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Metres Drilled 278,974 233,453
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* Net cash is calculated as cash minus current portion of long term
debt and long term debt
"We are pleased to announce solid first quarter results, which reflect management's disciplined adherence to our proven business strategy," said Eric Alexandre, President and Chief Operating Officer. "Despite the challenging economic environment, we have maintained our growth momentum and expanded our existing fleet, adding 3 new drill rigs in the quarter."
First Quarter Results
In the first quarter ended September 30, 2009, Orbit Garant generated total revenues of $24.4 million, an increase of $1.3 million, or 5.6%, compared to Q1 of fiscal 2009.
Drilling Canada revenue was $22.6 million compared to $21.7 million for the Q1 fiscal 2009 period, representing an increase of 4.1%. This increase was attributable to the acquisition of Forage+ and organic growth in the quarter.
Drilling International revenue was $1.7 million, up from $1.2 million from the same period in fiscal 2009, while Manufacturing Canada revenue was nominal in the first quarter of fiscal 2010, down from $0.2 million in the Q1 fiscal 2009. In 2009, third party demand for drills from the Company's manufacturing subsidiary, Soudure Royale, experienced a slowdown, resulting from the global economic decline. During this time, Soudure Royale's productive capacity has been re-purposed to build supplies and upgrade Orbit Garant's drilling equipment.
The gross margin for the first quarter ended September 30, 2009 increased to 32.8% from 32.5% in the corresponding period in the previous year.
Total gross profit in Q1 2010 was $8.0 million compared to $7.5 million in the comparable fiscal 2009 period, representing an increase of 6.4%.
General and administrative expenses were $1.8 million in the first quarter of 2010, compared to $1.6 million in the comparable period in 2009. The increase in cost is a result of additional administrative expenses incurred to sustain the Company's growth. General and administrative expenses represented 7.3% of sales, compared to 7.1% in the previous year.
Normalized EBITDA in Q1 fiscal 2010 was $6.2 million compared to $6.0 million in Q1 of fiscal 2009, representing an increase of 4.1%.
Net earnings for the quarter totaled $2.5 million compared to $2.6 million in the comparable period last year, representing $0.08 per common share ($0.08 per share diluted) in both years. The Company incurred a $0.5 million increase in non-cash amortization expense in the quarter, a result of the acquisition of Forage+ and the addition of drills and equipment.
"Looking out to the balance of fiscal 2010, we are well positioned to benefit when economic conditions improve," added Mr. Alexandre. "The recent increase in the price of base metals and the sustained strength of gold are encouraging signs for our business and, while it's still too early to predict a turnaround, we're beginning to see some early indications of improved demand."
Full Financial Statements and Management's Discussion and Analysis are available on the Company website at www.orbitgarant.com and at www.sedar.com.
Conference Call
A conference call for analysts and interested listeners will be held Friday, November 13 at 10:00 a.m. (ET). The call-in numbers for participants are 416 644 3417 and 877 974 0446. A live audio feed of the call will also be available on the Internet at:
http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2860660
A replay of the call will be available on Friday, November 13 until Friday, November 20, 2009. To access the replay, call 416 640 1917 or 877 289 8525 enter pass code number 4177941, and then press the pound (No.) key. The replay can also be accessed over the Internet at the above address.
About Orbit Garant
Orbit Garant is one of the largest Canadian-based drilling companies, providing both underground and surface drilling services in Canada and internationally through its 139 drills and more than 500 employees. Orbit Garant provides services to major, intermediate and junior mining companies, through each stage of mining exploration, development and production.
Forward-looking information
This press release may contain forward-looking statements (within the meaning of applicable securities laws) relating to business of Orbit Garant Drilling Inc. (the "Company") and the environment in which it operates. Forward-looking statements are identified by words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. These statements are based on the Company's expectations, estimates, forecasts and projections. They are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. These risks and uncertainties are discussed in the Company's regulatory filings available at www.sedar.com. There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances.
