Impax Energy Services Announces Financial Results
TORONTO, ONTARIO -- Impax Energy Services Income Trust (TSX: MPX.UN) (“Impax” or the “Trust”) today announced its financial results for the 201-day operating period ended December 31, 2006. The Trust’s operations generated net earnings of $0.9 million and an EBITDA of $16.3 million.
On June 14, 2006, Impax completed its initial public offering (IPO), which included the concurrent closing of the acquisitions of four oilfield service companies. The operations and financial results of Impax include operating activities for the 201-day period from June 14, 2006 through December 31, 2006. Impax’s financial results do not include comparative information because quarterly financial information for the prior periods is not available. In addition, the acquired companies were all private companies with different accounting periods.
IMPAX ENERGY SERVICES INCOME TRUST
201-day period ended
December 31, 2006
In 000’s of Dollars
except per unit amounts
Net earnings $899
Distributable cash(1) $13,670
Total assets $152,186
Earnings per unit - basic and diluted $0.08
At December 31, 2006, the Trust’s assets were $152.2 million and long-term debt was $37.7 million. The working capital as at December 31, 2006 was $6.2 million, comprised of current assets of $17.8 million and current liabilities of $11.5 million.
Total normal distributions to unitholders for the 201-day period ended December 31, 2006 of $9.2 million were previously announced.
In addition, further to an announcement on December 19, 2006, the Trust has fixed the special one-time cash distribution amount of $1.1 million or $0.08 per unit. The distribution will be payable to unitholders of record at the close of business on December 31, 2006 and will be paid on March 15, 2007.
The normal distributions represent a payout ratio(1) of 67% and the aggregate of the normal and special distributions represents a payout ratio of 75% for the 201-day period ended December 31, 2006, reflecting the strength of the Trust’s underlying operating businesses.
“We are pleased that all four of our businesses continue to perform. As a result, fiscal 2006 has been a very good year for Impax. Our businesses’ positive results have enabled us to sustain the current distribution per unit for the foreseeable future.” said Impax President & Chief Executive Officer, Scott Delaney.
On October 31, 2006, the federal government announced its intention to change the way income trusts are taxed. If the proposed changes are enacted as currently drafted, they will not affect the taxation of the Trust until January 2011. The Trust is currently reviewing the possible impact of these proposed tax measures on the Trust. “We remain focused on the growth of our operations as we are confident that we will continue to deliver an attractive investment proposition to our unit holders” said Mr. Delaney.
Impax Energy Services Income Trust is an open-ended trust, providing oilfield services in western Canada. The Trust indirectly owns a 55.5% interest in Impax Energy Services Master Limited Partnership, which indirectly acquired and now operates through its subsidiaries the businesses of McClelland Oilfield Rentals Limited Partnership, EGOC Enviro Group Limited Partnership, Denray Rathole Drilling Limited Partnership and Dwayne Hommy Trucking Limited Partnership. These businesses provide services in the areas of oilfield rental, specialized equipment rental, access mat rental, waste management services, rat hole drilling and specialty fluid hauling.
This news release may contain forward-looking statements relating to expected future events and financial and operating results of the Trust that involve risks and uncertainties. Actual results may differ materially from management expectations as projected in such forward-looking statements for a variety of reasons, including market and general economic conditions and the risks and uncertainties detailed in the Trust’s May 30, 2006 prospectus filed with the Canadian securities regulatory authorities. Due to the potential impact of these factors, the Trust disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.
(1) As discussed in the Management’s Discussion and Analysis, EBITDA and distributable cash are not earnings measures recognized by GAAP and do not have a standardized meaning prescribed by GAAP. References to “EBITDA” are to net earnings before interest expense, income taxes, amortization, impairment charges, unit based compensation and non-controlling interest and references to “distributable cash” are to cash available for distribution to Unitholders in accordance with the distribution policies of the Trust. Management believes that, in addition to net earnings, EBITDA is a useful supplemental measure of both performance and cash available for distribution before debt service, changes in working capital, capital expenditures and income taxes. Distributable cash is a measure generally used by income trusts as an indicator of financial performance and is a useful supplemental measure that may assist prospective investors in assessing an investment in the Trust. Management has calculated distributable cash as cash flow from operations before non-cash working capital changes for the periods less purchases of maintenance capital property and equipment. Changes in non-cash working capital items have been excluded from cash flows from operations so as to remove the effects of timing differences in cash receipts and cash disbursements, which generally reverse themselves and can vary significantly between fiscal quarters. Unitholder Payout Ratio is a non-GAAP financial measure, and therefore has no standardized meaning prescribed by GAAP and may not be comparable to similar terms and measures presented by other similar issuers. Unitholder Payout Ratio is intended to provide additional information on the Fund’s performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
Additional Financial Information
The full annual report including the audited consolidated financial statements with accompanying notes and Management’s Discussion and Analysis will be filed on SEDAR.
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