Microsoft Cloud Authors: Jim Kaskade, Lori MacVittie, Andreas Grabner, Janakiram MSV, Pat Romanski

News Feed Item

Energold Drilling Announces Third Quarter 2012 Financial and Production Results

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 11/26/12 -- Energold Drilling Corp. (TSX VENTURE:EGD) ("Energold" or "the Company") announces year-to-date revenues of $115.8 million, an 18% increase from $98.2 million for the nine months ended September 30, 2012.

During the third quarter, the Mineral division drilled 92,300 meters, a decrease of 46% compared to Q3 2011, due to the continued weakness in the overall capital markets. The division remains profitable, generating $17.3 million in revenue this quarter and a net earnings of $0.6 million. The Energy division drilled 61,700 meters during the third quarter, generating $9.0 million in revenues, while the division's year-to-date revenues increased 302% to $38.9 million compared to the same period in 2011. The Manufacturing division's revenue for the first nine months in 2012 was $11.4 million, a 16% increase from $9.8 million in the comparable period in 2011.

Excluding non-cash and extraordinary items such as bonus acquisition expense for Energold Energy Drilling Services ("EEDS"), foreign exchange, and share-based payments, Energold generated $2.1 million in adjusted EBITDA on combined gross margins of 21%. Without the adjustments, the Company recorded a net loss of $2.5 million in Q3 2012. Fred Davidson, President and CEO, states, "Our results this quarter reflect the uncertain business environment, the decline in activity in some markets due to ongoing external factors including politics, weather issues, and difficulty in accessing capital for junior exploration companies. The Company's revenue remains robust in several diversified markets, with a strong senior and intermediate clientele who are committed to their projects."

Energold's growth has been significant over the past three years, and has broadened its revenue base to diversify the risk exposure of a purely mineral based business. EEDS in Alberta and the Manufacturing division, operating as Dando in the U.K., continue to perform above management's expectations. In the current period of softer demand for mineral exploration, the Company is leveraging relationships from its market leading position in frontier drilling and expand complementary service offerings to existing clients. Energold is focused on identifying new growth opportunities, increasing productivity, and capitalizing on synergies for growth within the Energy and Manufacturing divisions. With $27.8 million in the treasury, and over $96.0 million in working capital, management believes the Company remains in an enviable position to weather the current market environment and capitalize on acquisition opportunities.

Third Quarter Results Comparison
($CAD '000s except per-share amounts and meters drilled)

                                       For Three Months     For Nine Months
                                     Ended September 30  Ended September 30
                                         2012      2011      2012      2011
                 Mineral               17,251    31,244    65,468    78,684
                 Manufacturing          3,603     6,113    11,414     9,821
                 Energy                 9,036     9,676    38,928     9,676
Total Revenue                         $29,890   $47,033  $115,810   $98,181
Earnings (Loss)                                                            
                 Mineral                  628     7,910     4,102    14,198
                 Manufacturing           (288)      571      (294)     (204)
                 Energy                (2,848)     (291)   (7,463)     (291)
Total Earnings                        $(2,508)   $8,190   $(3,655)  $13,703
     Earnings Per Share     - Basic     (0.05)     0.20     (0.08)    (0.34)
                          - Diluted     (0.05)     0.20     (0.08)    (0.33)

(i) EBITDA - Earnings before interest, taxes, depreciation and amortization (see non-GAAP (generally accepted accounting principles) financial measures).

(ii) Adjusted Earnings - Extraordinary and non-cash items include bonus expense to Energold Energy, accretion expense on debenture, share-based payments, foreign exchange, dilution and equity gain/loss on IMPACT, impairment/write-down of assets.


Meters drilled during the third quarter decreased over the comparable quarter in 2011 as a result of the challenging capital markets, particularly in the junior mining sector. The Mineral division drilled 92,300 meters in the quarter, a 46% decrease from the comparable quarter in 2011 generating revenues of $17.3 million, a 45% dip from the comparable period in 2011. Average revenue per meter was $192 in the first nine months of 2012 compared to $174 in 2011. Management anticipates this to trend lower as excess rig capacity in the markets may lead to lower competitive bids. Gross margin percentage is historically tied to the business mix of frontier-style drilling and established brownfield drill programs, with the latter moving the average revenue per meter lower. With a higher percentage of programs dedicated to majors' brownfields projects during the third quarter, gross margin was 28%, compared to 31% in the comparable period 2011.

Meters Drilled During the Quarter

                                                         9 Months  9 Months
                                      Q3 2012   Q3 2011      2012      2011
Meters Drilled                         92,300   170,300   341,700   451,400
Drill Rigs                                130       122       N/A       N/A

As of September 30, 2012, Energold had a total of 130 mineral exploration rigs, with two track mounted rigs on order from the Manufacturing division, Dando. Mexico, the Caribbean, and Central America and accounted for over 52% of the meters drilled for the third quarter of 2012 with 45 rigs in the region. With local offices in Mexico City and a depot in Chihuahua to service field operations, the Company has expectations of further growth in Central America. South America currently has 42 drill rigs across Brazil, Colombia, Peru, Chile, and Argentina, contributing 21% of the total meters drilled for the quarter. During the quarter, demand stabilized in Brazil after declines in the second quarter; however costs remain elevated to retain key personnel. The market, in general, saw rapid growth in 2010 and 2011, but has recently experienced a decline in activity and utilization and increasing political risk. Colombia's growth remained positive, with several ongoing programs and commitments from existing clients in the area. The modular S rigs continue to be well suited for challenging and remote projects within this region and the Company expects the area to pick up as macro-economic issues continue to resolve. Energold currently has 40 rigs in Africa, and meters drilled here accounted for 27% of total meters drilled in the mineral division, a 7% increase from the comparable quarter in 2011. Additionally, there are currently two rigs in Asia, with efforts continuing to penetrate the Asian market where the Company's S rigs are ideal for the combination of challenging infrastructure and low labour costs.


EEDS generates the majority of its revenue during the winter months due to favorable ground conditions. As expected, the historically lower levels of activity during the third quarter resulted in a slight decrease in revenue of $9.0 million during the third quarter compared to $9.7 million in the third quarter of 2011. There were no seismic contracts worked on during the quarter; however, there are several outstanding tenders.

Oil sands operations account for $7.0 million revenues for the third quarter and $23.9 million of year-to-date revenue, approximately 61% of total revenues in EEDS. The Company drilled for oil sands clients despite the warmer months, a sign of the backlog of work available in the industry. As a testament to the robustness of the industry, in August 2012, EEDS was awarded multi-year energy drilling contracts valued at $45 million annually, scheduled to commence in 2013 (see News Release dated August 21, 2012: http://www.energold.com/s/NewsReleases.asp?ReportID=543036&_Type=News-Releases&_Title=Energold-Drilling-Announces-Multi-Year-Energy-Drilling-Contracts). Currently, all of EEDS's oil sands rigs are committed for the 2012 to 2013 winter season, and management's growth target for 2013 is 25% to 50% above the 2012 figures.

Meters Drilled During the Quarter

                                                                   9 Months
                                                          Q3 2012      2012
Oil Sands coring                                           14,000    50,200
                                                           47,700   205,500
Seismic (Track and Heli portable)                               -   335,500
TOTAL                                                      61,700   591,200


Energold Manufacturing, operating as Dando, continued to expand its business clientele and marketing globally, generating $3.6 million in revenue accounted for using the percentage-of-completion method during the quarter, while incurring a net loss of $0.3 million this quarter as the group continues to work through lower margin legacy contracts. Year-to-date, the division is growing with revenues of $11.4 million and gross margins of 23% compared to $9.8 million and margin of 18% in 2011. The Company expects a strong Q4 to close out 2012 with contracts being completed before year end. With a sizable order book globally resulting from the implementation of a structured approach to procurement, increased sales and marketing efforts and synergies, Dando manufactured and shipped a variety of mining and water rigs to Uganda, Kurdistan, Nigeria, Ghana, and Indonesia during the quarter.

As part of the efforts to strengthen internal competencies and efficiencies, Industrial Processes Chihuahua, S.A.C. ("IPC"), a manufacturing facility in Chihuahua, Mexico, acquired by Energold in 2011, is now supplying the group globally. Previously, IPC was producing specific parts for the Company's Mexican operations and provided ongoing support for rig fleets in the area only.

Energold Drilling Corp. is a leading global specialty drilling company that services the mining, energy, and manufacturing sectors in over 22 countries globally. Specializing in a socially and environmentally sensitive approach to drilling, Energold provides a comprehensive range of drilling services from early stage exploration to mine site operations for both metals and energy sectors and has an established drill rig manufacturer, Dando. Energold also holds 6.98 million shares of IMPACT Silver Corp., a profitable silver producer in Mexico.

On behalf of the Directors of Energold Drilling Corp.,

Frederick W. Davidson, President, CEO

Forward-Looking Statements: Some statements in this news release contain forward-looking information. These statements include, but are not limited to, statements with respect to proposed activities, work programs and future expenditures. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, among others, the effects of general economic conditions, a reduction in the demand for the Company's drilling services, the price of commodities, changing foreign exchange rates, actions by government authorities, the failure to find economically viable acquisition targets, title matters, environmental matters, reliance on key personnel, the ability for operational and other reasons to complete proposed activities and work programs, the need for additional financing and the timing and amount of expenditures. Energold Drilling Corp. does not assume the obligation to update any forward-looking statement.

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 news release.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
SYS-CON Events announced today that Roundee / LinearHub will exhibit at the WebRTC Summit at @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LinearHub provides Roundee Service, a smart platform for enterprise video conferencing with enhanced features such as automatic recording and transcription service. Slack users can integrate Roundee to their team via Slack’s App Directory, and '/roundee' command lets your video conference ...
SYS-CON Events announced today that Enzu will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to focus on the core of their online busine...
SYS-CON Events announced today that SoftNet Solutions will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. SoftNet Solutions specializes in Enterprise Solutions for Hadoop and Big Data. It offers customers the most open, robust, and value-conscious portfolio of solutions, services, and tools for the shortest route to success with Big Data. The unique differentiator is the ability to architect and...
Why do your mobile transformations need to happen today? Mobile is the strategy that enterprise transformation centers on to drive customer engagement. In his general session at @ThingsExpo, Roger Woods, Director, Mobile Product & Strategy – Adobe Marketing Cloud, covered key IoT and mobile trends that are forcing mobile transformation, key components of a solid mobile strategy and explored how brands are effectively driving mobile change throughout the enterprise.
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, will be adding the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining senso...
"Matrix is an ambitious open standard and implementation that's set up to break down the fragmentation problems that exist in IP messaging and VoIP communication," explained John Woolf, Technical Evangelist at Matrix, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
@ThingsExpo has been named the Top 5 Most Influential Internet of Things Brand by Onalytica in the ‘The Internet of Things Landscape 2015: Top 100 Individuals and Brands.' Onalytica analyzed Twitter conversations around the #IoT debate to uncover the most influential brands and individuals driving the conversation. Onalytica captured data from 56,224 users. The PageRank based methodology they use to extract influencers on a particular topic (tweets mentioning #InternetofThings or #IoT in this ...
The IoT has the potential to create a renaissance of manufacturing in the US and elsewhere. In his session at 18th Cloud Expo, Florent Solt, CTO and chief architect of Netvibes, discussed how the expected exponential increase in the amount of data that will be processed, transported, stored, and accessed means there will be a huge demand for smart technologies to deliver it. Florent Solt is the CTO and chief architect of Netvibes. Prior to joining Netvibes in 2007, he co-founded Rift Technologi...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
24Notion is full-service global creative digital marketing, technology and lifestyle agency that combines strategic ideas with customized tactical execution. With a broad understand of the art of traditional marketing, new media, communications and social influence, 24Notion uniquely understands how to connect your brand strategy with the right consumer. 24Notion ranked #12 on Corporate Social Responsibility - Book of List.
Established in 1998, Calsoft is a leading software product engineering Services Company specializing in Storage, Networking, Virtualization and Cloud business verticals. Calsoft provides End-to-End Product Development, Quality Assurance Sustenance, Solution Engineering and Professional Services expertise to assist customers in achieving their product development and business goals. The company's deep domain knowledge of Storage, Virtualization, Networking and Cloud verticals helps in delivering ...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smar...
@ThingsExpo has been named the Top 5 Most Influential M2M Brand by Onalytica in the ‘Machine to Machine: Top 100 Influencers and Brands.' Onalytica analyzed the online debate on M2M by looking at over 85,000 tweets to provide the most influential individuals and brands that drive the discussion. According to Onalytica the "analysis showed a very engaged community with a lot of interactive tweets. The M2M discussion seems to be more fragmented and driven by some of the major brands present in the...
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
In the next five to ten years, millions, if not billions of things will become smarter. This smartness goes beyond connected things in our homes like the fridge, thermostat and fancy lighting, and into heavily regulated industries including aerospace, pharmaceutical/medical devices and energy. “Smartness” will embed itself within individual products that are part of our daily lives. We will engage with smart products - learning from them, informing them, and communicating with them. Smart produc...
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, will discuss the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docke...
As ridesharing competitors and enhanced services increase, notable changes are occurring in the transportation model. Despite the cost-effective means and flexibility of ridesharing, both drivers and users will need to be aware of the connected environment and how it will impact the ridesharing experience. In his session at @ThingsExpo, Timothy Evavold, Executive Director Automotive at Covisint, will discuss key challenges and solutions to powering a ride sharing and/or multimodal model in the a...
Just over a week ago I received a long and loud sustained applause for a presentation I delivered at this year’s Cloud Expo in Santa Clara. I was extremely pleased with the turnout and had some very good conversations with many of the attendees. Over the next few days I had many more meaningful conversations and was not only happy with the results but also learned a few new things. Here is everything I learned in those three days distilled into three short points.
SYS-CON Events announced today that Embotics, the cloud automation company, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Embotics is the cloud automation company for IT organizations and service providers that need to improve provisioning or enable self-service capabilities. With a relentless focus on delivering a premier user experience and unmatched customer support, Embotics is the fas...
SYS-CON Events announced today that Coalfire will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Coalfire is the trusted leader in cybersecurity risk management and compliance services. Coalfire integrates advisory and technical assessments and recommendations to the corporate directors, executives, boards, and IT organizations for global brands and organizations in the technology, cloud, health...