CALGARY, Alberta, April 08, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy”) (TSX:TOT) will conduct a conference call and webcast following the release of its financial results for the three months ended March 31, 2024. The financial results will be released prior to the conference call. Daniel Halyk, President and CEO will host the call.
Open to:
Shareholders and other interested persons
Date:
May 10, 2024
Time:
9:00 a.m. (Mountain Time)
Call:
(844) 763-8274 or (647) 484-8814
A live webcast of the conference call will be accessible on Total Energy’s website at www.totalenergy.ca by selecting “Webcasts”.
Shortly after the live webcast, an archived version will be available on Total Energy’s website. A recording of the conference call will also be available until June 10, 2024, by dialing (855) 669-9658, passcode 0834.
Headquartered in Calgary, Alberta, Total Energy provides contract drilling services, equipment rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol “TOT”.
For further information, please contact Yuliya Gorbach, Vice-President Finance and Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta, March 11, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy”) (TSX:TOT) announces that its Board of Directors has declared a quarterly dividend of $0.09 (Cdn.) per common share for the quarter ending March 31, 2024 on Total Energy’s outstanding common shares. The dividend is payable on April 15, 2024, to shareholders of record at the close of business on March 28, 2024. The ex-dividend date is March 27, 2024.
Unless otherwise indicated, all dividends paid by Total Energy are “eligible dividends” within the meaning of subsection 89(1) of the Income Tax Act (Canada).
Headquartered in Calgary, Alberta, Total Energy provides contract drilling services, rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Yuliya Gorbach, Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta, March 07, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy” or the “Company”) (TSX:TOT) announces its consolidated financial results for the three months and year ended December 31, 2023.
Financial Highlights
($000’s except per share data)
Three months ended December 31
Year ended December 31
2023
2022
Change
2023
2022
Change
Revenue
$
213,758
$
211,479
1
%
$
892,396
$
759,813
17
%
Operating income
23,510
15,605
51
%
84,622
49,343
71
%
EBITDA(1)
45,276
35,872
26
%
168,961
131,320
29
%
Cashflow
44,457
38,590
15
%
163,321
130,795
25
%
Net income (loss)
(7,861
)
12,264
nm
41,594
37,999
9
%
Attributable to shareholders
(7,847
)
12,244
nm
41,625
38,008
10
%
Per Share Data (Diluted)
EBITDA(1)
$
1.11
$
0.84
32
%
$
4.11
$
3.06
34
%
Cashflow
$
1.09
$
0.91
20
%
$
3.97
$
3.04
31
%
Attributable to shareholders:
Net income (loss)
$
(0.19
)
$
0.29
nm
$
1.01
$
0.88
15
%
Common shares (000’s)(4)
Basic
39,975
41,652
(4
%)
40,409
42,216
(4
%)
Diluted
40,623
42,524
(4
%)
41,147
42,980
(4
%)
December 31
December 31
Financial Position at
2023
2022
Change
Total Assets
$
861,658
$
878,615
(2
%)
Long-Term Debt and Lease Liabilities (excluding current portion)
100,834
127,628
(21
%)
Working Capital(2)
123,439
112,154
10
%
Net Debt(3)
–
15,474
(100
%)
Shareholders’ Equity
530,758
522,023
2
%
Notes 1 through 4 please refer to the Notes to the Financial Highlights set forth at the end of this release.
nm – calculation not meaningful
Total Energy’s results for the fourth quarter and year ended December 31, 2023 reflect continued stable industry conditions. North American market share gains resulting from equipment upgrades and modestly improved pricing contributed to improved fourth quarter results in 2023 as compared to 2022. Fourth quarter Australian revenue was lower compared to the prior year due to lower service rig activity. $16.2 million of non-recurring income tax expense and $10.6 million of related interest and penalties were recorded in the fourth quarter of 2023 as a result of a Tax Court of Canada ruling upholding Canada Revenue Agency reassessments related to the Company’s 2009 income trust conversion. Despite the $26.8 million reduction in net income resulting from this reassessment, Total Energy achieved record consolidated financial results for 2023.
Contract Drilling Services (“CDS”)
Three months ended December 31
Year ended December 31
2023
2022
Change
2023
2022
Change
Revenue
$
74,700
$
69,185
8
%
$
287,333
$
252,663
14
%
EBITDA(1)
$
23,880
$
17,976
33
%
$
75,710
$
60,002
26
%
EBITDA(1) as a % of revenue
32
%
26
%
23
%
26
%
24
%
8
%
Operating days(2)
2,588
2,600
–
10,311
10,485
(2
%)
Canada
1,890
1,588
19
%
6,913
6,263
10
%
United States
356
689
(48
%)
2,052
2,734
(25
%)
Australia
342
323
6
%
1,346
1,488
(10
%)
Revenue per operating day(2), dollars
$
28,864
$
26,610
8
%
$
27,867
$
24,098
16
%
Canada
27,162
24,751
10
%
26,076
22,369
17
%
United States
30,483
28,270
8
%
28,700
25,126
14
%
Australia
36,582
32,207
14
%
35,791
29,484
21
%
Utilization
30
%
30
%
–
30
%
30
%
–
Canada
27
%
22
%
23
%
25
%
22
%
14
%
United States
32
%
58
%
(45
%)
47
%
58
%
(19
%)
Australia
74
%
70
%
6
%
74
%
82
%
(10
%)
Rigs, average for period
94
94
–
94
94
–
Canada
77
76
1
%
77
76
1
%
United States
12
13
(8
%)
12
13
(8
%)
Australia
5
5
–
5
5
–
(1)
See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
(2)
Operating days includes drilling and paid standby days.
CDS segment revenue during the fourth quarter of 2023 was higher compared with the previous year quarter due to increased revenue per operating day arising from the deployment of upgraded equipment. Negatively impacting utilization in the United States was the transfer of a triple drilling rig to Canada during the second quarter of 2023 and a general slowdown in industry activity, which was partially offset by higher pricing due in part to the mix of equipment operating. Higher utilization following the return to service of an upgraded drilling rig combined with higher revenue per operating day due to rate increases arising from rig upgrades and fewer standby days due to wet weather in 2023 compared to 2022 contributed to improved year over year fourth quarter results in Australia.
Rentals and Transportation Services (“RTS”)
Three months ended December 31
Year ended December 31
2023
2022
Change
2023
2022
Change
Revenue
$
19,544
$
20,043
(2
%)
$
84,906
$
66,954
27
%
EBITDA(1)
$
6,927
$
6,171
12
%
$
30,904
$
23,361
32
%
EBITDA(1) as a % of revenue
35
%
31
%
13
%
36
%
35
%
3
%
Revenue per utilized piece of equipment, dollars
$
14,139
$
12,483
13
%
$
55,041
$
44,376
24
%
Pieces of rental equipment
7,700
9,440
(18
%)
7,700
9,440
(18
%)
Canada
6,790
8,540
(20
%)
6,790
8,540
(20
%)
United States
910
900
1
%
910
900
1
%
Rental equipment utilization
18
%
18
%
–
18
%
16
%
13
%
Canada
16
%
16
%
–
16
%
15
%
7
%
United States
33
%
33
%
–
35
%
29
%
21
%
Heavy trucks
67
71
(6
%)
67
71
(6
%)
Canada
46
48
(4
%)
46
48
(4
%)
United States
21
23
(9
%)
21
23
(9
%)
(1)
See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
Fourth quarter revenue in the RTS segment decreased marginally as compared to the same period in 2022 due to the deferral of certain projects in Canada that was partially offset by market share gains in the United States. Higher year over year fourth quarter EBITDA and EBITDA margin was due to improved revenue per utilized piece of equipment. A significant number of underutilized rental pieces were disposed of in Canada during 2023.
Compression and Process Services (“CPS”)
Three months ended December 31
Year ended December 31
2023
2022
Change
2023
2022
Change
Revenue
$
95,439
$
93,668
2
%
$
417,646
$
331,669
26
%
EBITDA(1)
$
14,074
$
10,771
31
%
$
53,817
$
36,933
46
%
EBITDA(1) as a % of revenue
15
%
11
%
36
%
13
%
11
%
18
%
Horsepower of equipment on rent at period end
39,496
41,243
(4
%)
39,496
41,243
(4
%)
Canada
13,856
18,768
(26
%)
13,856
18,768
(26
%)
United States
25,640
22,475
14
%
25,640
22,475
14
%
Rental equipment utilization during the period (HP)(2)
67
%
75
%
(11
%)
73
%
61
%
20
%
Canada
76
%
66
%
15
%
77
%
47
%
64
%
United States
61
%
84
%
(27
%)
70
%
79
%
(11
%)
Sales backlog at period end, $ million
$
162.8
$
219.5
(26
%)
$
162.8
$
219.5
(26
%)
(1)
See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
(2)
Rental equipment utilization is measured on a horsepower basis.
The year over year increase in the CPS segment’s fourth quarter revenue was due primarily to higher United States fabrication sales, increased equipment overhaul activity and improved utilization of the Canadian compression rental fleet. EBITDA and EBITDA margin increased due to improved fabrication sales margins and a greater relative revenue contribution from the higher margin parts and service business. The fabrication sales backlog decreased to $162.8 million compared to the $219.5 million backlog at December 31, 2022. Sequentially, the quarter end backlog increased by $9.9 million from September 30, 2023.
Well Servicing (“WS”)
Three months ended December 31
Year ended December 31
2023
2022
Change
2023
2022
Change
Revenue
$
24,075
$
28,583
(16
%)
$
102,511
$
108,527
(6
%)
EBITDA (1)
$
3,997
$
6,222
(36
%)
$
19,833
$
23,395
(15
%)
EBITDA (1) as a % of revenue
17
%
22
%
(23
%)
19
%
22
%
(14
%)
Service hours(2)
24,631
29,566
(17
%)
106,551
117,306
(9
%)
Canada
13,293
14,460
(8
%)
52,281
57,123
(8
%)
United States
4,707
5,374
(12
%)
23,488
19,157
23
%
Australia
6,631
9,732
(32
%)
30,782
41,026
(25
%)
Revenue per service hour(2), dollars
$
977
$
967
1
%
$
962
$
925
4
%
Canada
931
960
(3
%)
949
918
3
%
United States
924
955
(3
%)
969
899
8
%
Australia
1,109
983
13
%
980
948
3
%
Utilization(3)
29
%
33
%
(13
%)
31
%
32
%
(3
%)
Canada
26
%
28
%
(7
%)
26
%
27
%
(4
%)
United States
47
%
53
%
(11
%)
59
%
48
%
23
%
Australia
25
%
37
%
(32
%)
29
%
39
%
(26
%)
Rigs, average for period
79
79
–
79
79
–
Canada
56
56
–
56
56
–
United States
11
11
–
11
11
–
Australia
12
12
–
12
12
–
(1)
See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
(2)
Service hours is defined as well servicing hours of service provided to customers and includes paid rig move and standby.
(3)
The Company reports its service rig utilization for its operational service rigs in North America based on service hours of 3,650 per rig per year to reflect standard 10 hour operations per day. Utilization for the Company’s service rigs in Australia is calculated based on service hours of 8,760 per rig per year to reflect standard 24 hour operations.
Fourth quarter Canadian activity in the WS segment was negatively impacted by reduced well abandonment activity following the conclusion of government incentive programs. Segment EBITDA for the fourth quarter decreased as compared to 2022 due to lower activity in all jurisdictions and competitive North American pricing that was partially offset by increased pricing in Australia.
Corporate
During the fourth quarter of 2023, Total Energy remained focused on the safe and efficient operation of its business and the execution of its 2023 capital expenditure program in preparation for the upcoming North American winter drilling season. $75.2 million of capital expenditures were made to December 31, 2023, with $14.2 million of 2023 capital expenditure commitments carried forward into 2024.
Total Energy exited the fourth quarter of 2023 with $123.4 million of positive working capital, including $47.9 million of cash, and $125 million of available credit under its $175 million of revolving bank credit facilities. The weighted average interest rate on the Company’s outstanding debt at December 31, 2023 was 5.25%.
Outlook
Industry conditions remain relatively stable. Oil and natural gas producers continue to be measured in their drilling and completion programs as they pursue acquisition opportunities and execute shareholder return strategies. While recent North American natural gas spot market price weakness may adversely impact near term natural gas drilling activity, the pending completion of several LNG export facilities is expected to provide relief to the North American natural gas market.
Total Energy’s previously announced 2024 preliminary capital expenditure budget of $46.5 million includes $22.4 million of growth capital. Included in 2024 growth capital is the recertification and upgrade of three Australian service rigs that are being reactivated under long term contracts. The first rig was completed and commenced operations in late February and the remaining two rigs are expected to be completed and commence operations during the second and third quarters of 2024, respectively. Included in 2023 capital expenditure commitments carried into 2024 is the completion of an Australian drilling rig that is expected to commence operations in July 2024 under a long term contract as well as several natural gas compression rental units being constructed for deployment in the United States under long term contracts.
Total Energy’s wholly owned subsidiary, Savanna Energy Services Australia Pty Ltd. (“Savanna Australia”) today completed the acquisition of Saxon Energy Services Australia Pty Ltd. (“Saxon”). US $34.8 million cash was paid at closing, with an additional US $2.0 million less any applicable post-closing deductions to be paid on the first anniversary of closing. Concurrent with the acquisition of Saxon, Muhammad Yasir Nisar was appointed Assistant Vice President, Drilling Services of Total Energy.
Dividend Increase
The Board of Directors of Total Energy has declared a dividend of $0.09 per common share for the quarter ended March 31, 2024, a 13% increase from the fourth quarter 2023 dividend. The dividend is payable on April 15, 2024 to shareholders of record at the close of business on March 29, 2024. The ex-dividend date is March 28, 2024. Unless otherwise indicated, all dividends declared by the Company are “eligible dividends” within the meaning of subsection 89(1) of the Income Tax Act (Canada).
Conference Call
At 9:00 a.m. (Mountain Time) on March 8, 2024 Total Energy will conduct a conference call and webcast to discuss its fourth quarter financial results. Daniel Halyk, President & Chief Executive Officer, will host the conference call. A live webcast of the conference call will be accessible on Total Energy’s website at www.totalenergy.ca by selecting “Webcasts”. Persons wishing to participate in the conference call may do so by calling (800) 319-4610 or (416) 915-3239. Those who are unable to listen to the call live may listen to a recording of it on Total Energy’s website. A recording of the conference call will also be available until April 8, 2024 by dialing (855) 669-9658 (passcode 0705).
Selected Financial Information
Selected financial information relating to the three months and year ended December 31, 2023 and 2022 is included in this news release. This information should be read in conjunction with the 2023 Consolidated Financial Statements of Total Energy and the notes thereto as well as management’s discussion and analysis to be issued in due course and in the Company’s 2023 Annual Report.
Consolidated Statements of Financial Position
(in thousands of Canadian dollars)
(audited)
December 31
December 31
2023
2022
Assets
Current assets:
Cash and cash equivalents
$
47,935
$
34,061
Accounts receivable
137,604
154,581
Inventory
98,179
91,614
Prepaid expenses and deposits
16,735
18,847
Income taxes receivable
–
496
Current portion of lease asset
–
378
300,453
299,977
Property, plant and equipment
557,152
567,515
Income taxes receivable
–
7,070
Goodwill
4,053
4,053
$
861,658
$
878,615
Liabilities & Shareholders’ Equity
Current liabilities:
Accounts payable and accrued liabilities
$
116,794
$
114,274
Deferred revenue
39,321
63,895
Income taxes payable
9,771
–
Dividends payable
3,198
2,490
Current portion of lease liabilities
5,880
5,173
Current portion of long-term debt
2,050
1,991
177,014
187,823
Long-term debt
90,947
117,997
Lease liabilities
9,887
9,631
Deferred income tax liability
53,052
41,141
Shareholders’ equity:
Share capital
251,283
261,109
Contributed surplus
4,805
3,590
Accumulated other comprehensive loss
(25,506
)
(17,032
)
Non-controlling interest
521
552
Retained earnings
299,655
273,804
530,758
522,023
$
861,658
$
878,615
Consolidated Statements of Comprehensive Income
(in thousands of Canadian dollars except per share amounts)
Three months ended
December 31
Year ended
December 31
2023
2022
2023
2022
(unaudited)
(unaudited)
(audited)
(audited)
Revenue
$
213,758
$
211,479
$
892,396
$
759,813
Cost of services
155,976
162,291
678,246
589,809
Selling, general and administration
13,242
11,082
46,828
39,671
Other expense (income)
(92
)
2,115
(300
)
1,035
Share-based compensation
729
351
2,186
1,142
Depreciation
20,393
20,035
80,814
78,813
Operating income
23,510
15,605
84,622
49,343
Gain on sale of property, plant and equipment
1,373
232
3,525
3,164
Finance costs, net
(12,235
)
(2,094
)
(17,425
)
(7,374
)
Net income before income taxes
12,648
13,743
70,722
45,133
Current income tax expense
17,077
1,289
17,217
1,250
Deferred income tax expense
3,432
190
11,911
5,884
Total income tax expense
20,509
1,479
29,128
7,134
Net income (loss)
$
(7,861
)
$
12,264
$
41,594
$
37,999
Net income (loss) attributable to:
Shareholders of the Company
$
(7,847
)
$
12,244
$
41,625
$
30,008
Non-controlling interest
(14
)
20
(31
)
(9
)
Income (loss) per share
Basic
$
(0.20
)
$
0.29
$
1.03
$
0.90
Diluted
$
(0.19
)
$
0.29
$
1.01
$
0.88
Consolidated Statements of Comprehensive Income (Loss)
Three months ended
December 31
Year ended
December 31
2023
2022
2023
2022
(unaudited)
(unaudited)
(audited)
(audited)
Net income (loss)
$
(7,861
)
$
12,264
$
41,594
$
37,999
Foreign currency translation
(1,440
)
965
(8,474
)
9,672
Total other comprehensive income (loss) for the period
(1,440
)
965
(8,474
)
9,672
Total comprehensive income (loss)
$
(9,301
)
$
13,229
$
33,120
$
47,671
Total comprehensive income (loss) attributable to:
Shareholders of the Company
$
(9,287
)
$
13,209
$
33,151
$
47,680
Non-controlling interest
(14
)
20
(31
)
(9
)
Consolidated Statements of Cash Flows
(in thousands of Canadian dollars)
Three months ended
December 31
Year ended
December 31
2023
2022
2023
2022
(unaudited)
(unaudited)
(audited)
(audited)
Cash provided by (used in):
Operations:
Net income (loss) for the period
$
(7,861
)
$
12,264
$
41,594
$
37,999
Add (deduct) items not affecting cash:
Depreciation
20,393
20,035
80,814
78,813
Share-based compensation
729
351
2,186
1,142
Gain on sale of property, plant and equipment
(1,373
)
(232
)
(3,525
)
(3,164
)
Finance costs, net
12,235
2,094
17,425
7,374
Foreign currency translation
(136
)
2,115
(4,420
)
1,035
Current income tax expense
17,077
1,289
17,217
1,250
Deferred income tax expense
3,432
190
11,911
5,884
Income taxes recovered (paid)
(39
)
484
119
462
Cashflow
44,457
38,590
163,321
130,795
Changes in non-cash working capital items:
Accounts receivable
25,373
9,564
16,977
(64,103
)
Inventory
3,285
1,777
(6,565
)
(1,690
)
Prepaid expenses and deposits
7,319
466
2,112
(9,639
)
Accounts payable and accrued liabilities
(15,805
)
(4,543
)
(5,325
)
40,417
Deferred revenue
(14,265
)
8,755
(24,574
)
47,621
Cash provided by operating activities
50,364
54,609
145,946
143,401
Investing:
Purchase of property, plant and equipment
(15,611
)
(14,713
)
(75,242
)
(56,735
)
Proceeds on disposal of property, plant and equipment
5,106
332
11,516
6,292
Changes in non-cash working capital items
(5,599
)
(1,373
)
(3,107
)
8,181
Cash used in investing activities
(16,104
)
(15,754
)
(66,833
)
(42,262
)
Financing:
Repayment of long-term debt
(10,500
)
(28,574
)
(26,991
)
(70,529
)
Repayment of lease liabilities
(1,198
)
(1,359
)
(5,912
)
(4,966
)
Dividends to shareholders
(3,198
)
(2,517
)
(12,142
)
(4,999
)
Repurchase of common shares
–
(4,491
)
(13,587
)
(12,638
)
Shares issued on exercise of share options
–
42
42
158
Interest paid
(1,314
)
(2,198
)
(6,649
)
(7,469
)
Cash used in financing activities
(16,210
)
(39,097
)
(65,239
)
(100,443
)
Change in cash and cash equivalents
18,050
(242
)
13,874
696
Cash and cash equivalents, beginning of period
29,885
34,303
34,061
33,365
Cash and cash equivalents, end of period
$
47,935
$
34,061
$
47,935
$
34,061
Segmented Information
The Company provides a variety of products and services to the energy and other resource industries through five reporting segments, which operate substantially in three geographic regions. These reporting segments are Contract Drilling Services, which includes the contracting of drilling equipment and the provision of labor required to operate the equipment, Rentals and Transportation Services, which includes the rental and transportation of equipment used in energy and other industrial operations, Compression and Process Services, which includes the fabrication, sale, rental and servicing of gas compression and process equipment and Well Servicing, which includes the contracting of service rigs and the provision of labor required to operate the equipment. Corporate includes activities related to the Company’s corporate and public issuer affairs.
As at and for the three months ended December 31, 2023 (unaudited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
74,700
$
19,544
$
95,439
$
24,075
$
–
$
213,758
Cost of services
47,897
10,485
78,813
18,781
–
155,976
Selling, general and administration
3,436
2,260
3,294
1,324
2,928
13,242
Other (income) loss
(85
)
(35
)
113
–
(85
)
(92
)
Share-based compensation
–
–
–
–
729
729
Depreciation
9,668
5,111
2,528
2,853
233
20,393
Operating income (loss)
13,784
1,723
10,691
1,117
(3,805
)
23,510
Gain on sale of property, plant and equipment
428
93
855
27
(30
)
1,373
Finance costs, net
(21
)
(50
)
(110
)
(23
)
(12,031
)
(12,235
)
Net income (loss) before income taxes
14,191
1,766
11,436
1,121
(15,866
)
12,648
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
364,968
169,847
255,055
69,398
2,390
861,658
Total liabilities
64,810
29,502
93,980
6,383
136,225
330,900
Capital expenditures
6,282
1,446
7,669
208
6
15,611
Canada
United States
Australia
Total
Revenue
$
116,289
$
77,779
$
19,690
$
213,758
Non-current assets(2)
384,448
129,817
46,940
561,205
As at and for the three months ended December 31, 2022 (unaudited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
69,185
$
20,043
$
93,668
$
28,583
$
–
$
211,479
Cost of services
49,225
12,152
79,703
21,211
–
162,291
Selling, general and administration
2,007
1,912
3,208
1,153
2,802
11,082
Other income
–
–
–
–
2,115
2,115
Share-based compensation
–
–
–
–
351
351
Depreciation
9,138
4,868
2,618
3,165
246
20,035
Operating income (loss)
8,815
1,111
8,139
3,054
(5,514
)
15,605
Gain on sale of property, plant and equipment
23
192
14
3
–
232
Finance costs, net
(9
)
(16
)
(124
)
(9
)
(1,936
)
(2,094
)
Net income (loss) before income taxes
8,829
1,287
8,029
3,048
(7,450
)
13,743
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
346,870
182,095
260,019
83,628
6,003
878,615
Total liabilities
62,545
20,292
122,320
6,003
145,432
356,592
Capital expenditures
6,865
3,490
3,928
400
30
14,713
Canada
United States
Australia
Total
Revenue
$
89,191
$
97,228
$
25,060
$
211,479
Non-current assets(2)
373,637
146,886
51,045
571,568
(1)
Corporate includes the Company’s corporate activities and obligations pursuant to long-term credit facilities.
(2)
Includes property, plant and equipment, lease asset (excluding current portion) and goodwill.
As at and for the year ended December 31, 2023 (audited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
287,333
$
84,906
$
417,646
$
102,511
$
–
$
892,396
Cost of services
201,363
46,210
352,079
78,594
–
678,246
Selling, general and administration
10,988
8,634
13,416
4,448
9,342
46,828
Other income
(65
)
(35
)
25
–
(225
)
(300
)
Share-based compensation
–
–
–
–
2,186
2,186
Depreciation
37,775
19,731
10,350
11,944
1,014
80,814
Operating income (loss)
37,272
10,366
41,776
7,525
(12,317
)
84,622
Gain on sale of property, plant and equipment
663
807
1,691
364
–
3,525
Finance costs, net
(65
)
(113
)
(463
)
(74
)
(16,710
)
(17,425
)
Net income (loss) before income taxes
37,870
11,060
43,004
7,815
(29,027
)
70,722
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
364,968
169,847
255,055
69,398
2,390
861,658
Total liabilities
64,810
29,502
93,980
6,383
136,225
330,900
Capital expenditures
46,810
7,223
14,452
6,516
241
75,242
Canada
United States
Australia
Total
Revenue
$
419,618
$
381,396
$
91,382
$
892,396
Non-current assets(2)
384,448
129,817
46,940
561,205
As at and for the year ended December 31, 2022 (audited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate
Total
Drilling
Transportation
and Process
Servicing
(1)
Services
Services
Services
Revenue
$
252,663
$
66,954
$
331,669
$
108,527
$
–
$
759,813
Cost of services
185,579
37,713
286,259
80,258
–
589,809
Selling, general and administration
7,374
6,902
10,071
5,130
10,194
39,671
Other expense
–
–
–
–
1,035
1,035
Share-based compensation
–
–
–
–
1,142
1,142
Depreciation
35,785
19,518
9,725
12,832
953
78,813
Operating income (loss)
23,925
2,821
25,614
10,307
(13,324
)
49,343
Gain on sale of property, plant and equipment
292
1,022
1,594
256
–
3,164
Finance costs, net
(23
)
(75
)
(412
)
(26
)
(6,838
)
(7,374
)
Net income (loss) before income taxes
24,194
3,768
26,796
10,537
(20,162
)
45,133
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
346,870
182,095
260,019
83,628
6,003
878,615
Total liabilities
62,545
20,292
122,320
6,003
145,432
356,592
Capital expenditures
34,835
8,508
9,490
3,792
110
56,735
Canada
United States
Australia
Total
Revenue
$
371,478
$
263,751
$
124,584
$
759,813
Non-current assets(2)
373,637
146,886
51,045
571,568
(1)
Corporate includes the Company’s corporate activities and obligations pursuant to long-term credit facilities.
(2)
Includes property, plant and equipment, lease asset (excluding current portion) and goodwill.
Total Energy provides contract drilling services, equipment rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Daniel Halyk, President & Chief Executive Officer at (403) 216-3921 or Yuliya Gorbach, Vice-President Finance and Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca
Notes to the Financial Highlights
(1)
EBITDA means earnings before interest, taxes, depreciation and amortization and is equal to net income (loss) before income taxes plus finance costs plus depreciation. EBITDA is not a recognized measure under IFRS. Management believes that in addition to net income (loss), EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company’s primary business activities prior to consideration of how those activities are financed, amortized or how the results are taxed in various jurisdictions as well as the cash generated by the Company’s primary business activities without consideration of the timing of the monetization of non-cash working capital items. Readers should be cautioned, however, that EBITDA should not be construed as an alternative to net income determined in accordance with IFRS as an indicator of Total Energy’s performance. Total Energy’s method of calculating EBITDA may differ from other organizations and, accordingly, EBITDA may not be comparable to measures used by other organizations.
(2)
Working capital equals current assets minus current liabilities.
(3)
Net Debt equals long-term debt plus lease liabilities plus current liabilities minus current assets. Management believes this measure provides a useful indication of the Company’s liquidity.
(4)
Basic and diluted shares outstanding reflect the weighted average number of common shares outstanding for the periods. See note 15 to the Company’s 2023 Consolidated Financial Statements.
Certain statements contained in this press release, including statements which may contain words such as “could”, “should”, “expect”, “believe”, “will” and similar expressions and statements relating to matters that are not historical facts are forward-looking statements. Forward-looking statements are based upon the opinions and expectations of management of Total Energy as at the effective date of such statements and, in some cases, information supplied by third parties. Although Total Energy believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions and that information received from third parties is reliable, it can give no assurance that those expectations will prove to have been correct.
In particular, this press release contains forward-looking statements concerning industry activity levels, including expectations regarding Total Energy’s future activity levels, market share and compression and process production activity. Such forward-looking statements are based on a number of assumptions and factors including fluctuations in the market for oil and natural gas and related products and services, political and economic conditions, central bank interest rate policy, the demand for products and services provided by Total Energy, Total Energy’s ability to attract and retain key personnel and other factors. Such forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Total Energy to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Reference should be made to Total Energy’s most recently filed Annual Information Form and other public disclosures (available at www.sedar.com) for a discussion of such risks and uncertainties.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta, March 07, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy” or “the Company”) (TSX:TOT) is pleased to announce that its wholly owned subsidiary Savanna Energy Services Pty Ltd. (“Savanna Australia”) has completed the acquisition of all of the shares of Saxon Energy Services Australia Pty Ltd. (“Saxon”) from SLB. US $34.8 million was paid on completion and US $2.0 million less any post-completion adjustments will be paid on the first anniversary of completion.
The acquisition of Saxon increases Savanna Australia’s land drilling rig fleet to 16 rigs and substantially increases the depth capacity of such fleet. A seventeenth drilling rig is currently under construction for Savanna Australia and is scheduled to commence operating in July 2024 under a long term contract.
The acquisition of Saxon was funded utilizing cash on hand and existing credit facilities.
Concurrent with the acquisition of Saxon, Muhammad Yasir Nisar was appointed Assistant Vice President, Drilling Services of Total Energy. Mr. Nisar is a mechanical engineer who has been employed by SLB since 2006 in various roles of increasing responsibility within SLB’s global land drilling business. Most recently, Mr. Nisar was in charge of Saxon, a position he held since mid-2019. Mr. Nisar will remain in Australia to assist with the integration of Saxon into Savanna Australia, following which he will relocate to Calgary, Canada.
Headquartered in Calgary, Alberta, Total Energy provides contract drilling services, rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Daniel Halyk, President & Chief Executive Officer at (403) 216-3921 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
Forward-Looking Information Cautionary Statement
This news release contains certain forward-looking information (referred to herein as “forward-looking statements”). Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, “plan”, “scheduled”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “expect”, “may”, “will”, “project”, “should”, “scheduled” or similar words suggesting future events, circumstances or outcomes. In particular, this news release contains forward-looking information concerning the potential impact of the acquisition of Saxon on Total Energy including with respect to the Company’s drilling rig fleet, and the timing of the Company’s seventeenth drilling rig entering the Australian market.
Forward-looking statements are based upon the opinions and expectations of the management of Total Energy as at the effective date of such statements. Although Total Energy believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that those expectations will prove to have been correct. Forward-looking statements are subject to certain risks and uncertainties that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. The benefits anticipated with respect to the acquisition of Saxon are based on the current business, operational and financial position of each of Total Energy and Saxon, which are subject to a number of risks and uncertainties.
The forgoing risk factors are not exhaustive. Having regard to the various risk factors, readers should not place undue reliance upon the forward-looking statements contained in this news release and such forward-looking statements should not be interpreted or regarded as guarantees of future outcomes.
The forward-looking statements contained in this news release are made as of the date hereof and Total Energy does not undertake any obligation to update or to revise any of the included forward-looking statements, except as required by applicable securities laws in force in Canada. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
CALGARY, Alberta, Feb. 05, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (TSX:TOT) (“Total” or the “Company”) announces that its appeal of certain Canadian income tax reassessments related to the Company’s conversion from an income trust in 2009 has been dismissed by the Tax Court of Canada.
The Canada Revenue Agency reassessed Total for $16.2 million of income taxes owing, of which $7.1 million was previously remitted by the Company. Total will remit the remaining $9.1 million of reassessed income taxes together with interest as soon as possible and intends to appeal the judgment.
Total Energy provides contract drilling services, rentals and transportation services, well servicing and compression and process equipment and service to energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Daniel Halyk, President & CEO at (403) 216-3921 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta, Feb. 01, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy”) (TSX:TOT) will conduct a conference call and webcast following the release of its financial results for the three months ended December 31, 2023. The financial results will be released prior to the conference call. Daniel Halyk, President and CEO will host the call.
Open to:
Shareholders and other interested persons
Date:
March 08, 2024
Time:
9:00 a.m. (Mountain Time)
Call:
(800) 319-4610 or (416) 915-3239
A live webcast of the conference call will be accessible on Total Energy’s website at www.totalenergy.ca by selecting “Webcasts”.
Shortly after the live webcast, an archived version will be available on Total Energy’s website. A recording of the conference call will also be available until April 08, 2024, by dialing (855) 669-9658, passcode 0705
Headquartered in Calgary, Alberta, Total Energy provides contract drilling services, equipment rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol “TOT”.
For further information, please contact Yuliya Gorbach, Vice-President Finance and Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta, Jan. 17, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy” or “the Company”) (TSX:TOT) is pleased to announce that its wholly owned subsidiary Savanna Energy Services Australia Pty Ltd. (“Savanna Australia”) has entered into an agreement with SLB to acquire all of the shares of Saxon Energy Services Australia Pty Ltd. (“Saxon”) for US $37.0 million cash (the “Acquisition”). The Acquisition is expected to be completed during the first quarter of 2024, subject to the satisfaction of certain conditions including the receipt of regulatory approvals.
Headquartered in Brisbane, Australia, Saxon owns and operates a fleet of 11 land drilling rigs, 10 of which are currently marketed. Saxon’s marketed fleet includes four 600 horsepower rigs with hook load capacities ranging from 150,000 to 200,000 pounds, and six 1,200 horsepower rigs with hook load capacities ranging from 320,000 pounds to 400,000 pounds.
Savanna Australia currently owns and operates five hybrid coil tubing drilling rigs in Australia. These rigs have hook load capacities ranging from 100,000 to 150,000 pounds. A sixth rig, an AC electric rig with a hook load capacity of 150,000 pounds, is currently under construction and is scheduled to commence operations in Australia in mid-2024 under a long term contract.
When completed, the Acquisition will increase the depth capacity of Savanna Australia’s drilling rig fleet, add experienced local personnel and expand Savanna Australia’s customer base.
Total Energy intends to fund the Acquisition utilizing cash on hand and existing credit facilities.
Canaccord Genuity is acting as financial advisor to SLB on the Acquisition.
Headquartered in Calgary, Alberta, Total Energy provides contract drilling services, rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Daniel Halyk, President & Chief Executive Officer at (403) 216-3921 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
Forward-Looking Information Cautionary Statement
This news release contains certain forward-looking information (referred to herein as “forward-looking statements”). Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, “plan”, “scheduled”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “expect”, “may”, “will”, “project”, “should”, “scheduled” or similar words suggesting future events, circumstances or outcomes. In particular, this news release contains forward-looking information concerning the timing of the completion of the Acquisition including the approvals and conditions required with respect thereto, the potential impact of the Acquisition on Total Energy including with respect to the Company’s drilling rig fleet, personnel and customer base and the timing of the Company’s sixth drilling rig entering the Australian market.
Forward-looking statements are based upon the opinions and expectations of the management of Total Energy as at the effective date of such statements. Although Total Energy believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that those expectations will prove to have been correct. Forward-looking statements are subject to certain risks and uncertainties that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, such things as the required regulatory and other approvals may not be obtained in the timelines or on the terms currently anticipated or at all, the Acquisition will be subject to a number of closing conditions and no assurance can be given that all such conditions will be met or will be met on the timelines required. The benefits anticipated with respect to the Acquisition are based on the current business, operational and financial position of each of Total Energy and Saxon, which are subject to a number of risks and uncertainties.
The forgoing risk factors are not exhaustive. Having regard to the various risk factors, readers should not place undue reliance upon the forward-looking statements contained in this news release and such forward-looking statements should not be interpreted or regarded as guarantees of future outcomes.
The forward-looking statements contained in this news release are made as of the date hereof and Total Energy does not undertake any obligation to update or to revise any of the included forward-looking statements, except as required by applicable securities laws in force in Canada. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
CALGARY, Alberta, Jan. 08, 2024 (GLOBE NEWSWIRE) — Total Energy Services Inc. (TSX:TOT) (“Total” or the “Company”) announces its preliminary 2024 capital expenditure budget of $46.5 million which includes $22.4 million of expansion capital and $24.1 million for equipment maintenance and recertifications.
The 2024 expansion capital budget includes $17.4 million for rig upgrades in the Contract Drilling Services and Well Servicing segments. In addition, $5.0 million of expansion capital will be directed towards continued growth of the North American natural gas compression rental business.
The $24.1 million capital maintenance budget will be directed towards equipment re-certifications and maintenance in all business segments and the purchase of new drill pipe.
Approximately $14.2 million of 2023 capital expenditure commitments will carry forward into 2024. The Company intends to finance these remaining capital commitments and its 2024 capital expenditure budget with cash on hand and cash flow from operations.
Total Energy provides contract drilling services, rentals and transportation services, well servicing and compression and process equipment and service to energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Daniel Halyk, President & CEO at (403) 216-3921 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta , Dec. 01, 2023 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy”) (TSX:TOT) announces that its Board of Directors has declared a quarterly dividend of $0.08 (Cdn.) per common share for the quarter ending December 31, 2023 on Total Energy’s outstanding common shares. The dividend is payable on January 15, 2024, to shareholders of record at the close of business on December 29, 2023. The ex-dividend date is December 28, 2023.
Unless otherwise indicated, all dividends paid by Total Energy are “eligible dividends” within the meaning of subsection 89(1) of the Income Tax Act (Canada).
Headquartered in Calgary, Alberta, Total Energy provides contract drilling services, rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Yuliya Gorbach, Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca.
The TSX has neither approved nor disapproved of the information contained herein.
CALGARY, Alberta, Nov. 09, 2023 (GLOBE NEWSWIRE) — Total Energy Services Inc. (“Total Energy” or the “Company”) (TSX:TOT) announces its consolidated financial results for the three and nine months ended September 30, 2023.
Financial Highlights
($000’s except per share data)
Three months ended September 30
Nine months ended September 30
2023
2022
Change
2023
2022
Change
Revenue
$
232,016
$
207,678
12
%
$
678,638
$
548,334
24
%
Operating income
23,691
21,622
10
%
61,112
33,738
81
%
EBITDA(1)
44,955
42,335
6
%
123,685
95,448
30
%
Cashflow
40,784
41,078
(1
%)
118,864
92,205
29
%
Net income
19,237
17,163
12
%
49,455
25,735
92
%
Attributable to shareholders
19,231
17,179
12
%
49,472
25,764
92
%
Per Share Data (Diluted)
EBITDA(1)
$
1.10
$
0.98
12
%
$
3.00
$
2.21
36
%
Cashflow
$
1.00
$
0.95
5
%
$
2.88
$
2.14
35
%
Attributable to shareholders:
Net income
$
0.47
$
0.40
18
%
$
1.20
$
0.60
100
%
Common shares (000’s)(4)
Basic
40,149
42,339
(5
%)
40,555
42,367
(4
%)
Diluted
40,961
43,090
(5
%)
41,291
43,142
(4
%)
September 30
December 31
Financial Position at
2023
2022
Change
Total Assets
$
894,325
$
878,615
2
%
Long-Term Debt and Lease Liabilities (excluding current portion)
111,159
127,628
(13
%)
Working Capital(2)
127,566
112,154
14
%
Net Debt(3)
–
15,474
(100
%)
Shareholders’ Equity
542,528
522,023
4
%
Notes 1 through 4 please refer to the Notes to the Financial Highlights set forth at the end of this release.
Total Energy’s results for the third quarter and first nine months of 2023 reflect relatively stable industry conditions. Despite lower year over year North American third quarter industry activity levels, market share gains resulting from equipment upgrades contributed to modestly higher third quarter results in 2023 as compared to 2022. Third quarter Australian activity levels were lower compared to the prior year as one drilling rig and one service rig were out of service during the third quarter of 2023 for recertification and upgrades.
Contract Drilling Services (“CDS”)
Three months ended September 30
Nine months ended September 30
2023
2022
Change
2023
2022
Change
Revenue
$
75,815
$
73,976
2
%
$
212,633
$
183,478
16
%
EBITDA(1)
$
21,670
$
21,777
–
$
51,830
$
42,026
23
%
EBITDA(1)as a % of revenue
29
%
29
%
–
24
%
23
%
4
%
Operating days(2)
2,880
3,097
(7
%)
7,723
7,885
(2
%)
Canada
2,009
2,041
(2
%)
5,023
4,675
7
%
United States
535
648
(17
%)
1,696
2,045
(17
%)
Australia
336
408
(18
%)
1,004
1,165
(14
%)
Revenue per operating day(2), dollars
$
26,325
$
23,886
10
%
$
27,532
$
23,269
18
%
Canada
24,522
22,655
8
%
25,668
21,560
19
%
United States
28,540
26,370
8
%
28,326
24,067
18
%
Australia
33,577
26,100
29
%
35,522
28,729
24
%
Utilization
33
%
35
%
(6
%)
30
%
30
%
–
Canada
28
%
29
%
(3
%)
24
%
22
%
9
%
United States
48
%
54
%
(11
%)
53
%
58
%
(9
%)
Australia
73
%
89
%
(18
%)
74
%
85
%
(13
%)
Rigs, average for period
94
95
(1
%)
94
95
(1
%)
Canada
77
77
–
77
77
–
United States
12
13
(8
%)
12
13
(8
%)
Australia
5
5
–
5
5
–
(1)See Note 1 of the Notes to the Financial Highlights set forth at the end of this release. (2)Operating days includes drilling and paid stand-by days.
CDS segment revenue during the third quarter of 2023 was higher compared with the previous year quarter as lower operating days were more than offset by increased pricing. The deployment of upgraded equipment contributed to the year-over-year increase in third quarter revenue per operating day. Negatively impacting utilization in the United States was the transfer of a triple drilling rig to Canada during the second quarter of 2023 and a general slowdown in industry activity, which was partially offset by higher pricing. Lower Australian utilization due to the removal of a drilling rig from service for recertification and upgrade was partially offset by higher revenue per operating day as compared to the third quarter of 2022 due to rate increases arising from previous rig upgrades and fewer standby days due to wet weather in 2023 compared to 2022.
Rentals and Transportation Services (“RTS”)
Three months ended September 30
Nine months ended September 30
2023
2022
Change
2023
2022
Change
Revenue
$
21,137
$
18,070
17
%
$
65,362
$
46,911
39
%
EBITDA(1)
$
7,263
$
8,097
(10
%)
$
23,977
$
17,190
39
%
EBITDA(1)as a % of revenue
34
%
45
%
(24
%)
37
%
37
%
–
Revenue per utilized piece of equipment, dollars
$
12,825
$
11,283
14
%
$
42,473
$
31,075
37
%
Pieces of rental equipment
7,659
9,450
(19
%)
7,659
9,450
(19
%)
Canada
6,767
8,560
(21
%)
6,767
8,560
(21
%)
United States
892
890
–
892
890
–
Rental equipment utilization
19
%
17
%
12
%
18
%
16
%
13
%
Canada
18
%
16
%
13
%
16
%
15
%
7
%
United States
27
%
27
%
–
36
%
27
%
33
%
Heavy trucks
69
71
(3
%)
69
71
(3
%)
Canada
48
48
–
48
48
–
United States
21
23
(9
%)
21
23
(9
%)
(1)See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
Third quarter revenue in the RTS segment increased as compared to the same period in 2022 due to higher equipment utilization and modestly improved pricing. Lower year over year third quarter EBITDA and EBITDA margin was due primarily to equipment and personnel mobilization costs incurred in Canada in advance of the upcoming winter drilling season. A significant number of underutilized rental pieces were disposed of in Canada during the first nine months of 2023.
Compression and Process Services (“CPS”)
Three months ended September 30
Nine months ended September 30
2023
2022
Change
2023
2022
Change
Revenue
$
110,959
$
86,654
28
%
$
322,207
$
238,001
35
%
EBITDA(1)
$
14,404
$
7,956
81
%
$
39,402
$
26,162
51
%
EBITDA(1)as a % of revenue
13
%
9
%
44
%
12
%
11
%
9
%
Horsepower of equipment on rent at period end
36,616
37,563
(3
%)
36,616
37,563
(3
%)
Canada
15,226
15,018
1
%
15,226
15,018
1
%
United States
21,390
22,545
(5
%)
21,390
22,545
(5
%)
Rental equipment utilization during the period (HP)(2)
69
%
63
%
10
%
75
%
56
%
34
%
Canada
73
%
49
%
49
%
77
%
41
%
88
%
United States
67
%
81
%
(17
%)
74
%
77
%
(4
%)
Sales backlog at period end, $ million
$
152.9
$
197.8
(23
%)
$
152.9
$
197.8
(23
%)
(1) See Note 1 of the Notes to the Financial Highlights set forth at the end of this release. (2) Rental equipment utilization is measured on a horsepower basis.
The year over year increase in the CPS segment’s third quarter revenue was due primarily to higher United States fabrication sales, increased equipment overhaul activity and improved utilization of the compression rental fleet. EBITDA and EBITDA margin increased substantially due to improved fabrication sales margins and a greater revenue contribution from the higher margin rental business. The fabrication sales backlog decreased to $152.9 million compared to the $197.8 million backlog at September 30, 2022. Sequentially, the quarter end backlog decreased $32.7 million due to a moderation of quoting activity converting to sales during the third quarter of 2023 with no corresponding decrease in production activity as well as a shift in customer demand towards renting compression equipment.
Well Servicing (“WS”)
Three months ended September 30
Nine months ended September 30
2023
2022
Change
2023
2022
Change
Revenue
$
24,105
$
28,978
(17
%)
$
78,436
$
79,944
(2
%)
EBITDA(1)
$
5,044
$
6,896
(27
%)
$
16,177
$
17,173
(6
%)
EBITDA(1)as a % of revenue
21
%
24
%
(13
%)
21
%
21
%
–
Service hours(2)
26,044
30,894
(16
%)
81,920
87,740
(7
%)
Canada
12,140
15,506
(22
%)
38,988
42,663
(9
%)
United States
6,370
5,073
26
%
18,781
13,783
36
%
Australia
7,534
10,315
(27
%)
24,151
31,294
(23
%)
Revenue per service hour(2), dollars
$
926
$
938
(1
%)
$
957
$
911
5
%
Canada
923
969
(5
%)
955
903
6
%
United States
944
914
3
%
980
878
12
%
Australia
913
904
1
%
944
937
1
%
Utilization(3)
36
%
34
%
6
%
38
%
32
%
19
%
Canada
24
%
30
%
(20
%)
26
%
27
%
(4
%)
United States
63
%
50
%
26
%
63
%
46
%
37
%
Australia
28
%
39
%
(28
%)
31
%
40
%
(23
%)
Rigs, average for period
79
80
(1
%)
79
80
(1
%)
Canada
56
57
(2
%)
56
57
(2
%)
United States
11
11
–
11
11
–
Australia
12
12
–
12
12
–
(1) See Note 1 of the Notes to the Financial Highlights set forth at the end of this release. (2)Service hours is defined as well servicing hours of service provided to customers and includes paid rig move and standby. (3) The Company reports its service rig utilization for its operational service rigs in North America based on service hours of 3,650 per rig per year to reflect standard 10 hour operations per day. Utilization for the Company’s service rigs in Australia is calculated based on service hours of 8,760 per rig per year to reflect standard 24 hour operations.
Third quarter activity in the Canadian WS segment was negatively impacted by reduced well abandonment activity following the conclusion of government incentive programs. Negatively impacting third quarter activity in Australia was the removal of a service rig from operation for recertification and upgrades. Segment EBITDA for the third quarter decreased as compared to 2022 due to lower activity and competitive pricing in Canada and Australia.
Corporate
During the third quarter of 2023, Total Energy remained focused on the safe and efficient operation of its business and the execution of its 2023 capital expenditure program in preparation for the upcoming winter drilling season in North America. $59.6 million of capital expenditures have been made to September 30, 2023.
Total Energy exited the third quarter of 2023 with $127.6 million of positive working capital, including $29.9 million of cash, and $115 million of available credit under its $175 million of revolving bank credit facilities. The weighted average interest rate on the Company’s outstanding debt at September 30, 2023 was 5.35%.
Outlook
Industry conditions remain relatively stable and constructive despite continued global economic uncertainty and volatile commodity prices. Oil and natural gas producers continue to be measured in their drilling and completion programs as they pursue acquisition opportunities and execute on shareholder return strategies. Total Energy remains focused on the safe and efficient operation of its business, the disciplined deployment of capital and opportunities to enhance shareholder value.
In Australia, the drilling rig removed from service in the second quarter for recertification and upgrades returned to service in mid-October where it is currently deployed on a hydrogen drilling project.
Total Energy’s Board of Directors has approved a $20.0 million increase to the Company’s 2023 capital expenditure budget, which increase is being directed towards growth of the CPS segment’s compression rental fleet in direct response to customer demand. Total Energy intends to finance the remaining $32.5 million of its $92.1 million 2023 capital expenditure budget with cash on hand and cashflow.
Conference Call
At 9:00 a.m. (Mountain Time) on November 10, 2023 Total Energy will conduct a conference call and webcast to discuss its third quarter financial results. Daniel Halyk, President & Chief Executive Officer, will host the conference call. A live webcast of the conference call will be accessible on Total Energy’s website at www.totalenergy.ca by selecting “Webcasts”. Persons wishing to participate in the conference call may do so by calling (800) 319-4610 or (416) 915-3239. Those who are unable to listen to the call live may listen to a recording of it on Total Energy’s website. A recording of the conference call will also be available until December 10, 2023 by dialing (855) 669-9658 (passcode 0461).
Selected Financial Information
Selected financial information relating to the three and nine months ended September 30, 2023 and 2022 is included in this news release. This information should be read in conjunction with the condensed interim consolidated financial statements of Total Energy and the notes thereto as well as management’s discussion and analysis to be issued in due course and in the Company’s 2022 Annual report.
Consolidated Statements of Financial Position
(in thousands of Canadian dollars)
September 30
December 31
2023
2022
(unaudited)
(audited)
Assets
Current assets:
Cash and cash equivalents
$
29,885
$
34,061
Accounts receivable
162,977
154,581
Inventory
101,464
91,614
Prepaid expenses and deposits
24,054
18,847
Income taxes receivable
198
496
Current portion of lease asset
6
378
318,584
299,977
Property, plant and equipment
564,618
567,515
Income taxes receivable
7,070
7,070
Goodwill
4,053
4,053
$
894,325
$
878,615
Liabilities & Shareholders’ Equity
Current liabilities:
Accounts payable and accrued liabilities
$
126,861
$
114,274
Deferred revenue
53,586
63,895
Dividends payable
3,198
2,490
Current portion of lease liabilities
5,339
5,173
Current portion of long-term debt
2,034
1,991
191,018
187,823
Long-term debt
101,463
117,997
Lease liabilities
9,696
9,631
Deferred income tax liability
49,620
41,141
Shareholders’ equity:
Share capital
251,283
261,109
Contributed surplus
4,076
3,590
Accumulated other comprehensive loss
(24,066
)
(17,032
)
Non-controlling interest
535
552
Retained earnings
310,700
273,804
542,528
522,023
$
894,325
$
878,615
Consolidated Statements of Comprehensive Income
(in thousands of Canadian dollars except per share amounts)
(unaudited)
Three months ended
September 30
Nine months ended
September 30
2023
2022
2023
2022
Revenue
$
232,016
$
207,678
$
678,638
$
548,334
Cost of services
175,235
156,803
522,270
427,518
Selling, general and administration
12,027
9,695
33,586
28,589
Other expense (income)
238
(405
)
(208
)
(1,080
)
Share-based compensation
701
312
1,457
791
Depreciation
20,124
19,651
60,421
58,778
Operating income
23,691
21,622
61,112
33,738
Gain on sale of property, plant and equipment
1,140
1,062
2,152
2,932
Finance costs, net
(1,691
)
(1,911
)
(5,190
)
(5,280
)
Net income before income taxes
23,140
20,773
58,074
31,390
Current income tax expense (recovery)
(231
)
403
140
(39
)
Deferred income tax expense
4,134
3,207
8,479
5,694
Total income tax expense
3,903
3,610
8,619
5,655
Net income
$
19,237
$
17,163
$
49,455
$
25,735
Net income (loss) attributable to:
Shareholders of the Company
$
19,231
$
17,179
$
49,472
$
25,764
Non-controlling interest
6
(16
)
(17
)
(29
)
Income per share
Basic
$
0.48
$
0.41
$
1.22
$
0.61
Diluted
$
0.47
$
0.40
$
1.20
$
0.60
Condensed Interim Consolidated Statements of Comprehensive Income
Three months ended
September 30
Nine months ended
September 30
2023
2022
2023
2022
Net income
$
19,237
$
17,163
$
49,455
$
25,735
Foreign currency translation
(1,734
)
8,496
(7,034
)
8,707
Total other comprehensive income (loss) for the period
(1,734
)
8,496
(7,034
)
8,707
Total comprehensive income
$
17,503
$
25,659
$
42,421
$
34,442
Total comprehensive income (loss) attributable to:
Shareholders of the Company
$
17,497
$
25,675
$
42,438
$
34,471
Non-controlling interest
6
(16
)
(17
)
(29
)
Consolidated Statements of Cash Flows
(in thousands of Canadian dollars)
(unaudited)
Three months ended
September 30
Nine months ended
September 30
2023
2022
2023
2022
Cash provided by (used in):
Operations:
Net income for the period
$
19,237
$
17,163
$
49,455
$
25,735
Add (deduct) items not affecting cash:
Depreciation
20,124
19,651
60,421
58,778
Share-based compensation
701
312
1,457
791
Gain on sale of property, plant and equipment
(1,140
)
(1,062
)
(2,152
)
(2,932
)
Finance costs, net
1,691
1,911
5,190
5,280
Foreign currency translation
(3,934
)
(405
)
(4,284
)
(1,080
)
Current income tax expense (recovery)
(231
)
403
140
(39
)
Deferred income tax expense
4,134
3,207
8,479
5,694
Income taxes recovered (paid)
202
(102
)
158
(22
)
Cashflow
40,784
41,078
118,864
92,205
Changes in non-cash working capital items:
Accounts receivable
(13,516
)
(33,689
)
(8,396
)
(73,667
)
Inventory
10,194
123
(9,850
)
(3,467
)
Prepaid expenses and deposits
(5,353
)
(3,856
)
(5,207
)
(10,105
)
Accounts payable and accrued liabilities
(8,066
)
16,121
10,480
44,960
Deferred revenue
(2,104
)
(933
)
(10,309
)
38,866
Cash provided by operating activities
21,939
18,844
95,582
88,792
Investing:
Purchase of property, plant and equipment
(17,177
)
(17,063
)
(59,631
)
(42,022
)
Proceeds on disposal of property, plant and equipment
4,906
2,083
6,410
5,960
Changes in non-cash working capital items
(12
)
6,603
2,492
9,554
Cash used in investing activities
(12,283
)
(8,377
)
(50,729
)
(26,508
)
Financing:
Repayment of long-term debt
(498
)
(10,651
)
(16,491
)
(41,955
)
Repayment of lease liabilities
(1,558
)
(1,326
)
(4,714
)
(3,607
)
Dividends to shareholders
(3,212
)
(2,482
)
(8,944
)
(2,482
)
Repurchase of common shares
(2,298
)
(2,248
)
(13,587
)
(8,147
)
Shares issued on exercise of share options
42
85
42
116
Interest paid
(2,113
)
(1,887
)
(5,335
)
(5,271
)
Cash used in financing activities
(9,637
)
(18,509
)
(49,029
)
(61,346
)
Change in cash and cash equivalents
19
(8,042
)
(4,176
)
938
Cash and cash equivalents, beginning of period
29,866
42,345
34,061
33,365
Cash and cash equivalents, end of period
$
29,885
$
34,303
$
29,885
$
34,303
Segmented Information
The Company provides a variety of products and services to the energy and other resource industries through five reporting segments, which operate substantially in three geographic regions. These reporting segments are Contract Drilling Services, which includes the contracting of drilling equipment and the provision of labor required to operate the equipment, Rentals and Transportation Services, which includes the rental and transportation of equipment used in energy and other industrial operations, Compression and Process Services, which includes the fabrication, sale, rental and servicing of gas compression and process equipment and Well Servicing, which includes the contracting of service rigs and the provision of labor required to operate the equipment. Corporate includes activities related to the Company’s corporate and public issuer affairs.
As at and for the three months ended September 30, 2023 (unaudited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
75,815
$
21,137
$
110,959
$
24,105
$
–
$
232,016
Cost of services
51,265
11,828
94,122
18,020
–
175,235
Selling, general and administration
2,581
2,240
3,327
1,208
2,671
12,027
Other (income) loss
308
7
(131
)
–
54
238
Share-based compensation
–
–
–
–
701
701
Depreciation
9,580
4,903
2,585
2,802
254
20,124
Operating income (loss)
12,081
2,159
11,056
2,075
(3,680
)
23,691
Gain on sale of property, plant and equipment
9
201
763
167
–
1,140
Finance costs, net
(14
)
(28
)
(121
)
(18
)
(1,510
)
(1,691
)
Net income (loss) before income taxes
12,076
2,332
11,698
2,224
(5,190
)
23,140
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
367,553
176,330
275,886
74,376
180
894,325
Total liabilities
72,824
28,851
110,391
6,980
132,751
351,797
Capital expenditures
9,094
1,643
4,268
1,937
235
17,177
Canada
United States
Australia
Total
Revenue
$
111,945
$
99,790
$
20,281
$
232,016
Non-current assets(2)
393,168
129,263
46,240
568,671
As at and for the three months ended September 30, 2022 (unaudited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
73,976
$
18,070
$
86,654
$
28,978
$
–
$
207,678
Cost of services
50,189
8,501
77,234
20,879
–
156,803
Selling, general and administration
2,011
1,662
2,139
1,399
2,484
9,695
Other income
–
–
–
–
(405
)
(405
)
Share-based compensation
–
–
–
–
312
312
Depreciation
8,888
4,855
2,415
3,247
246
19,651
Operating income (loss)
12,888
3,052
4,866
3,453
(2,637
)
21,622
Gain on sale of property, plant and equipment
1
190
675
196
–
1,062
Finance costs, net
(8
)
(20
)
(114
)
(8
)
(1,761
)
(1,911
)
Net income (loss) before income taxes
12,881
3,222
5,427
3,641
(4,398
)
20,773
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
358,510
186,260
258,328
87,568
6,418
897,084
Total liabilities
79,604
18,246
110,036
7,121
166,537
381,544
Capital expenditures
10,506
2,260
2,801
1,427
69
17,063
Canada
United States
Australia
Total
Revenue
$
98,020
$
77,165
$
32,493
$
207,678
Non-current assets(2)
374,894
149,528
51,074
575,496
(1)Corporate includes the Company’s corporate activities and obligations pursuant to long-term credit facilities. (2)Includes property, plant and equipment, lease asset (excluding current portion) and goodwill.
As at and for the nine months ended September 30, 2023 (unaudited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
212,633
$
65,362
$
322,207
$
78,436
$
–
$
678,638
Cost of services
153,466
35,725
273,607
59,472
–
522,270
Selling, general and administration
7,552
6,374
10,122
3,124
6,414
33,586
Other (income) loss
20
–
(88
)
–
(140
)
(208
)
Share-based compensation
–
–
–
–
1,457
1,457
Depreciation
28,107
14,620
7,822
9,091
781
60,421
Operating income (loss)
23,488
8,643
30,744
6,749
(8,512
)
61,112
Gain on sale of property, plant and equipment
235
714
836
337
30
2,152
Finance costs, net
(44
)
(63
)
(353
)
(51
)
(4,679
)
(5,190
)
Net income (loss) before income taxes
23,679
9,294
31,227
7,035
(13,161
)
58,074
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
367,553
176,330
275,886
74,376
180
894,325
Total liabilities
72,824
28,851
110,391
6,980
132,751
351,797
Capital expenditures
40,528
5,777
6,783
6,308
235
59,631
Canada
United States
Australia
Total
Revenue
$
303,329
$
303,617
$
71,692
$
678,638
Non-current assets(2)
393,168
129,263
46,240
568,671
As at and for the nine months ended September 30, 2022 (unaudited, in thousands of Canadian dollars)
Contract
Rentals and
Compression
Well
Corporate(1)
Total
Drilling
Transportation
and Process
Servicing
Services
Services
Services
Revenue
$
183,478
$
46,911
$
238,001
$
79,944
$
–
$
548,334
Cost of services
136,354
25,561
206,556
59,047
–
427,518
Selling, general and administration
5,367
4,990
6,863
3,977
7,392
28,589
Other income
–
–
–
–
(1,080
)
(1,080
)
Share-based compensation
–
–
–
–
791
791
Depreciation
26,647
14,650
7,107
9,667
707
58,778
Operating income (loss)
15,110
1,710
17,475
7,253
(7,810
)
33,738
Gain on sale of property, plant and equipment
269
830
1,580
253
–
2,932
Finance costs, net
(14
)
(59
)
(288
)
(17
)
(4,902
)
(5,280
)
Net income (loss) before income taxes
15,365
2,481
18,767
7,489
(12,712
)
31,390
Goodwill
–
2,514
1,539
–
–
4,053
Total assets
358,510
186,260
258,328
87,568
6,418
897,084
Total liabilities
79,604
18,246
110,036
7,121
166,537
381,544
Capital expenditures
27,970
5,018
5,562
3,392
80
42,022
Canada
United States
Australia
Total
Revenue
$
282,287
$
166,523
$
99,524
$
548,334
Non-current assets(2)
374,894
149,528
51,074
575,496
(1)Corporate includes the Company’s corporate activities and obligations pursuant to long-term credit facilities. (2)Includes property, plant and equipment, lease asset (excluding current portion) and goodwill.
Total Energy provides contract drilling services, equipment rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.
For further information, please contact Daniel Halyk, President & Chief Executive Officer at (403) 216-3921 or Yuliya Gorbach, Vice-President Finance and Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca
Notes to the Financial Highlights
(1) EBITDA means earnings before interest, taxes, depreciation and amortization and is equal to net income (loss) before income taxes plus finance costs plus depreciation. EBITDA is not a recognized measure under IFRS. Management believes that in addition to net income (loss), EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company’s primary business activities prior to consideration of how those activities are financed, amortized or how the results are taxed in various jurisdictions as well as the cash generated by the Company’s primary business activities without consideration of the timing of the monetization of non-cash working capital items. Readers should be cautioned, however, that EBITDA should not be construed as an alternative to net income determined in accordance with IFRS as an indicator of Total Energy’s performance. Total Energy’s method of calculating EBITDA may differ from other organizations and, accordingly, EBITDA may not be comparable to measures used by other organizations.
(2) Working capital equals current assets minus current liabilities.
(3) Net Debt equals long-term debt plus lease liabilities plus current liabilities minus current assets. Management believes this measure provides a useful indication of the Company’s liquidity.
(4) Basic and diluted shares outstanding reflect the weighted average number of common shares outstanding for the periods. See note 5 to the Company’s Condensed Interim Consolidated Financial Statements.
Certain statements contained in this press release, including statements which may contain words such as “could”, “should”, “expect”, “believe”, “will” and similar expressions and statements relating to matters that are not historical facts are forward-looking statements. Forward-looking statements are based upon the opinions and expectations of management of Total Energy as at the effective date of such statements and, in some cases, information supplied by third parties. Although Total Energy believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions and that information received from third parties is reliable, it can give no assurance that those expectations will prove to have been correct.
In particular, this press release contains forward-looking statements concerning industry activity levels, including expectations regarding Total Energy’s future activity levels, market share and compression and process production activity. Such forward-looking statements are based on a number of assumptions and factors including fluctuations in the market for oil and natural gas and related products and services, political and economic conditions, central bank interest rate policy, the demand for products and services provided by Total Energy, Total Energy’s ability to attract and retain key personnel and other factors. Such forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Total Energy to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Reference should be made to Total Energy’s most recently filed Annual Information Form and other public disclosures (available at www.sedar.com) for a discussion of such risks and uncertainties.
The TSX has neither approved nor disapproved of the information contained herein.
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