CALGARY, April 30, 2015 /CNW/ - AKITA Drilling Ltd.'s net
earnings for the three months ended March
31, 2015 were $4,218,000
($0.24 per share basic; $0.23 per share diluted) on revenue of
$46,715,000 compared to net earnings
of $10,150,000 ($0.57 per share basic; $0.56 per share diluted) on revenue of
$54,342,000 for the corresponding
period in 2014. Funds flow from operations for the quarter
ended March 31, 2015 was $14,059,000 compared to $17,665,000 in the corresponding quarter in
2014.
During the first quarter of 2015, commodity prices for crude oil
and natural gas were reduced to approximately half of their values
compared to the corresponding quarter of 2014. This dramatic
reduction in commodity prices had a major negative effect on
AKITA's activity levels and overall profitability during the first
quarter of 2015. AKITA achieved 1,635 operating days in the
first quarter of 2015 compared to 2,112 operating days in the first
quarter of 2014. Conventional rig activity declined 60% from
the first quarter of 2014 which was partially offset by a 9%
increase in pad rig activity.
Overall, the 23% decline in operating days compared to the first
quarter of 2014 had a significant impact on AKITA's financial
performance in the first quarter of 2015. The lower activity
level resulted in less revenue and ultimately lower net earnings
and funds flow from operations. In addition to fewer
operating days, the Company also experienced significant pressure
on day rates throughout its operations when compared to the first
quarter of 2014. However, the effect of downward day rate
pressure was mitigated by the utilization of more pad rigs in the
first quarter of 2015, which command higher day rates than the mix
of rigs utilized in the first quarter of 2014.
Unlike 2014 when the Company undertook the largest capital
program in its history, management's focus in 2015 has been
directed to ensuring that AKITA maintains the quality of its
balance sheet, which has historically been one of the strongest in
the industry. As such, following the completion of
construction of a pad triple rig in mid-2015, most of AKITA's
capital expenditures are planned towards routine items for the
balance of the year. At March 31,
2015, the Company had net working capital of $5,350,000 and had $80,000,000 of unused borrowing capacity.
Management anticipates that the current weak market will
continue until significant and sustained improvements occur in
prices for crude oil and natural gas. However, a number of
key considerations exist that are expected to help ensure the
Company is well positioned to succeed through this challenging
environment: significant financial strength and flexibility, a high
performance drilling fleet operated by skilled and experienced
personnel that focus on providing a premium level of service, top
tier customers that have the financial resources to operate
throughout the business cycle and an overall strategy that is
scalable to changes in business conditions.
Selected information from AKITA Drilling Ltd.'s Management's
Discussion and Analysis from the Quarterly Report is as
follows:
Basis of Analysis in this MD&A, Non-Standard and
Additional GAAP Items
The Company reports its joint venture activities in the
financial statements in accordance with International Financial
Reporting Standards ("IFRS"), IFRS 11 "Joint Arrangements".
In determining the classification of its joint arrangements, AKITA
considers whether the joint arrangements are structured through
separate vehicles, if the legal form of the separate vehicles
confers upon the parties direct rights to assets and obligations
for liabilities relating to the arrangements, whether the
contractual terms between the parties confer upon them rights to
assets and obligations for liabilities relating to the arrangements
as well as if other facts and circumstances lead to rights for
assets and obligations for liabilities being conferred upon the
parties to the arrangement prior to concluding that AKITA's joint
ventures are properly classified as joint ventures rather than
joint operations. Under IFRS 11, AKITA is required to report
its joint venture assets, liabilities and financial activities
using the equity method of accounting. However, for purposes
of analysis in this MD&A, the proportionate share of assets,
liabilities and financial activities is included as non-standard
information ("Adjusted") where appropriate. The Company
provides the same drilling services and utilizes the same
management, financial and reporting controls for its joint venture
activities as are in place for its wholly owned operations.
None of AKITA's joint ventures are individually material in size
when considered in the context of AKITA's overall operations.
Operating margin, revenue per operating day, operating and
maintenance expenses per operating day and operating margin per
operating day are not recognized measures under IFRS.
Management and certain investors may find operating margin data to
be a useful measurement tool, however, as it provides an indication
of the profitability of the business prior to the influence of
depreciation, overhead expenses, financing costs and income
taxes. Management and certain investors may find "per
operating day" measures for revenue and operating margin indicate
pricing strength while operating and maintenance expenses per
operating day demonstrates the degree of cost control and provides
a proxy for specific inflation rates incurred by the Company.
Readers should be cautioned that in addition to the foregoing,
other factors, including the mix of rigs between conventional and
pad and singles, doubles and triples can also influence these
results. Readers should also be aware that AKITA includes
standby revenue in its determination of "per operating day"
results.
Funds flow from operations is considered as an additional GAAP
measure under IFRS. AKITA's method of determining funds flow
from operations may differ from methods used by other companies and
includes cash flow from operating activities before working capital
changes as well as equity income from joint ventures adjusted for
income tax amounts paid during the period. Management and
certain investors may find funds flow from operations to be a
useful measurement to evaluate the Company's operating results at
year-end and within each year, since the seasonal nature of the
business affects the comparability of non-cash working capital
changes both between and within periods.
Revenue and
Operating & Maintenance Expenses
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months Ended
March 31
|
2015
|
2014
|
Change
|
%
Change
|
Revenue per Interim
Financial Statements
|
46.7
|
54.3
|
(7.6)
|
(14%)
|
Proportionate Share
of Revenue from Joint Ventures(1)
|
12.8
|
17.5
|
(4.7)
|
(27%)
|
Adjusted
Revenue(1)
|
59.5
|
71.8
|
(12.3)
|
(17%)
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Operating &
Maintenance Expenses per Interim Financial Statements
|
31.2
|
34.8
|
(3.6)
|
(10%)
|
Proportionate Share
of Operating & Maintenance Expenses from Joint
Ventures(1)
|
8.3
|
10.9
|
(2.6)
|
(24%)
|
Adjusted Operating
& Maintenance Expenses (1)
|
39.5
|
45.7
|
(6.2)
|
(14%)
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Adjusted
Revenue(1)
|
59.5
|
71.8
|
(12.3)
|
(17%)
|
Adjusted Operating
& Maintenance Expenses(1)
|
39.5
|
45.7
|
(6.2)
|
(14%)
|
Adjusted Operating
Margin(1)(2)
|
20.0
|
26.1
|
(6.1)
|
(23%)
|
|
|
|
|
|
$Dollars
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Adjusted Revenue per
Operating Day(1)
|
36,393
|
34,028
|
2,365
|
7%
|
Adjusted Operating
& Maintenance Expenses per Operating
Day(1)
|
24,165
|
21,619
|
2,545
|
12%
|
Adjusted Operating
Margin per Operating Day(1)(2)
|
12,228
|
12,409
|
(180)
|
(1%)
|
(1)
|
Proportionate
share of revenue from joint ventures, adjusted revenue,
proportionate share of operating & maintenance expenses from
joint ventures, adjusted operating & maintenance expenses,
adjusted operating margin, adjusted revenue per operating day,
adjusted operating & maintenance expenses per operating day and
adjusted operating margin per operating day are non-standard
accounting measures. See commentary in "Basis of Analysis in
this MD&A, Non-Standard and Additional GAAP
Items".
|
(2)
|
Adjusted operating
margin is the difference between adjusted revenue and adjusted
operating & maintenance expenses.
|
During the first quarter of 2015, adjusted revenue decreased to
$59,502,000 from $71,867,000 during the first quarter of
2014. This reduction in adjusted revenue was directly
attributable to weaker market conditions that broadly influenced
AKITA's financial results, but was most pronounced for conventional
single and triple rigs. Weaker market conditions affected
both the amount of work for each rig category as well as the rates
that were achieved.
While overall adjusted revenue for the first quarter of 2015
declined by 17% compared to the corresponding quarter in 2014,
adjusted revenue per day increased by 7%. Although financial
results for each of AKITA's rig categories were negatively affected
by lower day rates, the change in classes of rigs worked offset
this effect. Most of AKITA's current year drilling activities
were performed by the Company's highest performance pad rigs which
are also the rigs that achieve the highest day rates.
Adjusted operating and maintenance costs are tied to revenue and
amounted to $39,509,000 ($24,165 per operating day) during the first
quarter of 2015 compared to $45,660,000 ($21,619 per operating day) in the same period of
the prior year. In addition to being the highest revenue
generating assets for the Company, AKITA's pad rigs also have the
highest "per operating day" operating and maintenance costs
associated with their operation.
The adjusted operating margin for the Company decreased to
$19,993,000 in the first quarter of
2015 from $26,207,000 during the
corresponding quarter of 2014. The reduction in adjusted
operating margin directly resulted from weaker drilling activity
during the quarter, particularly for conventional singles and
triples. When considered on a "per operating day basis", the
adjusted operating margin during the first quarter of 2015 was only
1% lower than during the corresponding first quarter of 2014 as
AKITA's highest performance rigs provided most of the drilling
activities.
From time to time, the Company requires customers to make
pre-payments prior to the provision of drilling services. In
addition, from time to time, the Company records cost recoveries
related to capital enhancements for specific customer related
projects. At March 31, 2015,
deferred revenue related to these activities totalled $127,000 (March 31,
2014 - $169,000).
Depreciation and
Amortization Expense
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Depreciation and
Amortization Expense
|
9.1
|
7.9
|
1.2
|
15%
|
Depreciation and amortization expense increased to $9,068,000 during the first quarter of 2015 from
$7,863,000 in the corresponding
period in 2014. AKITA depreciates its rig fleet on a unit of
production basis and while overall drilling days declined during
the first quarter of 2015 compared to the corresponding quarter in
2014, the most active rigs in AKITA's fleet were also the rigs with
the highest cost bases. In the first quarter of 2015,
drilling rig depreciation accounted for 96% of total depreciation
expense (Q1, 2014 - 96%).
While AKITA conducts many of its drilling operations via joint
ventures, the drilling rigs used to conduct those activities are
owned jointly by AKITA and its joint venture partners, and not the
joint ventures themselves. Therefore, the joint ventures do
not hold any property, plant, or equipment assets directly.
Consequently, the depreciation balance reported above includes
depreciation on assets involved in both wholly owned and joint
ventured activities.
Selling and
Administrative Expense
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Selling &
Administrative Expense per Interim Financial Statements
|
4.7
|
5.2
|
(0.5)
|
(10%)
|
Proportionate Share
of Selling & Administrative Expense from Joint
Ventures(1)
|
0.1
|
0.2
|
(0.1)
|
(50%)
|
Adjusted Selling
& Administrative Expense(1)
|
4.8
|
5.4
|
(0.6)
|
(11%)
|
(1)
|
Proportionate
share of selling and administrative expense from joint ventures and
adjusted selling and administrative expense are non-standard
accounting measures. See commentary in "Basis of Analysis in
this MD&A, Non-Standard and Additional GAAP
Items".
|
Adjusted selling and administrative expenses were 8.1% of
adjusted revenue in the first quarter of 2015 compared to 7.5% of
adjusted revenue in the first quarter of 2014, largely as a result
of decreased adjusted revenue in 2015. Salaries and benefits
accounted for 58% of these expenses (59% in Q1 2014).
Equity Income from
Joint Ventures
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Proportionate Share
of Revenue from Joint Ventures(1)
|
12.8
|
17.5
|
(4.7)
|
(27%)
|
Proportionate Share
of Operating & Maintenance Expenses from Joint
Ventures(1)
|
8.3
|
10.9
|
(2.6)
|
(24%)
|
Proportionate Share
of Selling & Administrative Expense from Joint
Ventures(1)
|
0.1
|
0.2
|
(0.1)
|
(50%)
|
Equity Income from
Joint Ventures
|
4.4
|
6.4
|
(2.0)
|
(31%)
|
(1)
|
Proportionate
share of revenue from joint ventures, proportionate share of
operating & maintenance expenses from joint ventures and
proportionate share of selling & administrative expense from
joint ventures are non-standard accounting measures. See
commentary in "Basis of Analysis in this MD&A, Non-Standard and
Additional GAAP Items".
|
The Company provides the same drilling services and utilizes the
same management, financial and reporting controls for its joint
venture activities as are in place for its wholly owned
operations. The analyses of these activities are incorporated
throughout the relevant sections of this MD&A. Joint
venture activities are often located in some of the most
prospective regions in Canada. Two thirds of rigs utilized by
AKITA's joint ventures are pad drilling rigs.
Other Income
(Losses)
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Total Other Income
(Losses)
|
(0.1)
|
0.5
|
(0.6)
|
(120%)
|
During the first quarter of 2015, the Company recorded interest
expense of $206,000 as a result of
the Company's indebtedness as well as to accrue the related future
cost of the Company's unfunded defined benefit pension plan.
During the corresponding quarter in 2014, AKITA recorded interest
expense of $34,000 primarily to
reflect the related future cost of the Company's unfunded defined
benefit pension plan.
The Company invests any cash balances in excess of its ongoing
operating requirements in bank guaranteed highly liquid
investments. Interest income decreased to $31,000 in the first three months of 2015 from
$64,000 in the corresponding period
of 2014 as a result of reduced cash and elimination of term deposit
balances. Since 2011, but especially in 2014, the Company has
undertaken significant capital expenditures related to the
construction of new rigs and the conversion of conventional rigs
into pad rigs, thereby utilizing term deposits and reducing AKITA's
cash balances over time.
During the first quarter of 2015, the Company sold some
ancillary assets for $705,000 that
resulted in a loss of $190,000 during
the quarter. No similar transaction occurred during the first
quarter of 2014.
Approximately 80% ($184,000)
of amounts recorded as "Net Other Gains" during the first quarter
of 2015 were related to foreign exchange, both realized and
unrealized, that were associated with ongoing rig
construction. In 2014, amounts reported as "Net Other Gains"
of $449,000 included $298,000 with respect to unrealized gains related
to forward exchange contracts purchased to provide a hedge for
foreign rig equipment commitments for a rig under construction.
Income Tax
Expense
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Current Tax
Expense
|
1.4
|
3.5
|
(2.1)
|
(60%)
|
Deferred Tax
Expense
|
0.3
|
(0.2)
|
0.5
|
250%
|
Income Tax
Expense
|
1.7
|
3.3
|
(1.6)
|
(48%)
|
Income tax expense decreased to $1,717,000 in the first quarter of 2015 from
$3,276,000 in the corresponding
period in 2014 due to lower pre-tax earnings. Recent capital
expenditure programs, particularly during 2014, have resulted in a
higher proportion of AKITA's income taxes being deferred into
future years.
Net Income, Funds
Flow and Net Cash From Operating Activities
|
|
|
|
|
|
|
|
|
|
$Million
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Net Income
|
4.2
|
10.2
|
(6.0)
|
(59%)
|
Funds Flow From
Operations(1)
|
14.1
|
17.7
|
(3.6)
|
(20%)
|
(1)
|
Funds flow from
operations is an additional GAAP measure under IFRS. See
commentary in "Basis of Analysis in this MD&A, Non-Standard and
Additional GAAP Items".
|
Net income attributable to shareholders decreased to
$4,218,000 ($0.24 basic earnings per Class A Non-Voting and
Class B Common Share / $0.23 diluted
earnings per share) for the first quarter of 2015 from $10,150,000 ($0.57
basic earnings per share / $0.56
diluted earnings per share) in the first quarter of 2014.
Funds flow from operations decreased to $14,059,000 in the first quarter of 2015 from
$17,665,000 in the corresponding
quarter in 2014. Lower net income in 2015 was directly
attributable to reductions in drilling activity, reduced day rates,
as well as increased depreciation expense. Funds flow from
operations was negatively affected by weaker drilling activity in
the first quarter of 2015 but is not affected by depreciation
expense. As a consequence, while net income decreased 59%
from the first quarter of 2014 to the first quarter of 2015, the
decline in funds flow when comparing the same periods was only
20%.
Fleet and Rig Utilization
AKITA had 35 drilling rigs during the first quarter of 2015,
including ten that operated under joint ventures, (31.725 net to
AKITA) compared to 38 rigs (34.725 net) during the corresponding
period of 2014. In addition, the Company had one pad rig
under construction at March 31,
2015.
|
|
|
|
|
Three Months
Ended March 31
|
2015
|
2014
|
Change
|
%
Change
|
Operating
Days
|
1,635
|
2,112
|
(477)
|
(23%)
|
Utilization
Rate
|
51.9%
|
61.8%
|
(9.9)
|
(16%)
|
Liquidity and Capital Resources
Cash used for capital expenditures totalled $5,017,000 in the first quarter of 2015 (2014 -
$18,064,000). Approximately 70%
of current year capital expenditures relate to ongoing construction
of a new pad rig which is anticipated to be completed in
mid-2015. Other capital expenditures related to routine
items.
At March 31, 2015, AKITA's
Statement of Financial Position included working capital (current
assets minus current liabilities) of $5,350,000 compared to working capital of
$34,926,000 at March 31, 2014 and a working capital deficiency
of $5,028,000 at December 31, 2014. The seasonal nature of
AKITA's business typically results in higher non-cash working
capital balances at the end of the first quarter than at year-end
due to the high seasonal activity levels encountered in the first
quarter. Non-cash working capital amounted to $3,996,000 at March 31,
2015 compared to a deficiency of $7,040,000 at December 31,
2014.
The Company did not have a normal course issuer bid in place
during the first quarter of 2015. During the three month
period ended March 31, 2014, the
Company purchased 27,600 Class A Non-Voting Shares at an average
purchase price of $15.49 pursuant to
its normal course issuer bid.
As part of the loan facility agreement, the Company must adhere
to the following financial covenants:
- Funded debt to EBITDA shall not be greater than 3.00 to 1. As
at March 31, 2015 (the most recent
measurement date), AKITA's actual rate was 0.38 to 1;
- EBITDA to interest expense shall not be less than 3.00 to 1. As
at March 31, 2015, AKITA's actual
rate was 120.90 to 1: and
- Tangible assets to funded debt shall not be less than 2.25 to
1. As at March 31, 2015, AKITA's
actual rate was 15.85 to 1.
Readers should be aware that the terms "funded debt", "EBITDA",
"interest expense" and "tangible assets" have been specifically
defined in the loan facility agreement and are not necessarily
defined by or consistent with either GAAP or determinations by
other users for other purposes.
The Company had four rigs under multi-year contracts at
March 31, 2015. Of these
contracts, two are anticipated to expire in 2016, one in 2018 and
one in 2019.
From time to time, the Company may provide guarantees for bank
loans to joint venture partners in respect of sales of rig
interests to joint venture partners. At March 31, 2015 (and at December 31, 2014), AKITA provided $9,381,000 in deposits with its bank for those
purposes (March 31, 2014 -
$5,950,000). AKITA's security
from its partners for these guarantees includes interests in
specific rig assets. The $9,381,000 in deposits has been classified as
restricted cash on the Consolidated Statements of Financial
Position.
Forward-Looking Statements|
From time to time AKITA makes forward-looking statements.
These statements include but are not limited to comments with
respect to AKITA's objectives and strategies, financial condition,
results of operations, the outlook for the industry and risk
management.
By their nature, these forward-looking statements involve
numerous assumptions, inherent risks and uncertainties, both
general and specific, and the risk that the predictions and other
forward-looking statements will not be realized. Readers of
this News Release are cautioned not to place undue reliance on
these statements as a number of important factors could cause
actual future results to differ materially from the plans,
objectives, estimates and intentions expressed in such
forward-looking statements.
Forward-looking statements may be influenced by factors such as
the level of exploration and development activity carried on by
AKITA's customers; world crude oil prices and North American
natural gas prices; weather; access to capital markets and
government policies. We caution that the foregoing list of
factors is not exhaustive and that investors and others should
carefully consider the foregoing factors as well as other
uncertainties and events prior to making a decision to invest in
AKITA. Except as required by law, the Company does not
undertake to update any forward-looking statements, whether written
or oral, that may be made from time to time by it or on its
behalf.
Selected financial information for the Company is as
follows:
AKITA Drilling
Ltd.
|
|
|
|
|
Interim
Consolidated Statements of Financial Position
|
|
|
|
|
|
|
Unaudited
|
|
March
31
|
March 31
|
December
31
|
$
Thousands
|
|
2015
|
2014
|
2014
|
Assets
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,354
|
$
|
5,643
|
$
|
2,012
|
|
Accounts
receivable
|
|
38,604
|
49,000
|
39,981
|
|
Income taxes
recoverable
|
|
1,800
|
-
|
3,011
|
|
Prepaid expenses and
other
|
|
983
|
1,539
|
257
|
|
|
|
42,741
|
56,182
|
45,261
|
Non-current
Assets
|
|
|
|
|
Restricted
cash
|
|
9,381
|
5,950
|
9,381
|
Other long-term
assets
|
|
998
|
994
|
1,025
|
Investment in joint
ventures
|
|
3,976
|
13,754
|
6,214
|
Property, plant and
equipment
|
|
274,126
|
223,208
|
279,045
|
Total
Assets
|
|
$
|
331,222
|
$
|
300,088
|
$
|
340,926
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
Operating loan
facility
|
|
$
|
19,814
|
$
|
-
|
$
|
20,000
|
|
Accounts payable and
accrued liabilities
|
|
15,925
|
17,487
|
28,589
|
|
Deferred
revenue
|
|
127
|
169
|
175
|
|
Dividends
payable
|
|
1,525
|
1,526
|
1,525
|
|
Income taxes
payable
|
|
-
|
2,074
|
-
|
|
|
|
37,391
|
21,256
|
50,289
|
Non-current
Liabilities
|
|
|
|
|
Financial
instruments
|
|
195
|
91
|
226
|
Deferred income
taxes
|
|
27,409
|
22,538
|
27,053
|
Deferred share
units
|
|
76
|
-
|
91
|
Pension
liability
|
|
3,534
|
2,650
|
3,426
|
Total
Liabilities
|
|
68,605
|
46,535
|
81,085
|
|
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
Class A and Class B
shares
|
|
23,871
|
23,871
|
23,871
|
Contributed
surplus
|
|
3,640
|
3,253
|
3,557
|
Accumulated other
comprehensive income (loss)
|
|
(280)
|
88
|
(280)
|
Retained
earnings
|
|
235,386
|
226,341
|
232,693
|
Total
Equity
|
|
262,617
|
253,553
|
259,841
|
Total Liabilities
and Equity
|
|
$
|
331,222
|
$
|
300,088
|
$
|
340,926
|
AKITA Drilling
Ltd.
|
|
|
|
Interim
Consolidated Statements of Net Income and Comprehensive
Income
|
|
|
|
|
|
Unaudited
|
|
|
Three Months
Ended March 31
|
$ Thousands except
per share amounts
|
|
2015
|
2014
|
|
|
|
|
|
Revenue
|
|
$
|
46,715
|
$
|
54,342
|
|
|
|
|
|
Costs and
expenses
|
|
|
|
Operating and
maintenance
|
|
|
31,244
|
34,790
|
Depreciation and
amortization
|
|
|
9,068
|
7,863
|
Selling and
administrative
|
|
|
4,711
|
5,224
|
Total costs and
expenses
|
|
45,023
|
47,877
|
|
|
|
|
|
Revenue less costs
and expenses
|
|
1,692
|
6,465
|
|
|
|
|
|
Equity income from
joint ventures
|
|
4,379
|
6,481
|
|
|
|
|
|
Other income
(losses)
|
|
|
|
Interest
income
|
|
|
31
|
64
|
Interest
expense
|
|
|
(206)
|
(34)
|
Gain (loss) on sale
of assets
|
|
|
(190)
|
1
|
Net other
gains
|
|
|
229
|
449
|
Total other
income (loss)
|
|
(136)
|
480
|
|
|
|
|
|
Income before
income taxes
|
|
5,935
|
13,426
|
|
|
|
|
|
Income
taxes
|
|
1,717
|
3,276
|
|
|
|
|
|
Net income for the
period attributable to shareholders
|
|
4,218
|
10,150
|
Other comprehensive
income
|
|
-
|
-
|
|
|
|
|
|
Comprehensive
income for the period attributable to
shareholders
|
$
|
4,218
|
$
|
10,150
|
|
|
|
|
|
|
|
|
|
|
Earnings per Class
A and Class B Share
|
|
|
|
Basic
|
|
|
$
|
0.24
|
$
|
0.57
|
Diluted
|
|
|
$
|
0.23
|
$
|
0.56
|
AKITA Drilling
Ltd.
|
|
|
|
Interim
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
Unaudited
|
|
Three Months
Ended March 31
|
$
Thousands
|
|
2015
|
2014
|
|
|
|
|
|
Operating
Activities
|
|
|
|
Net income and
comprehensive income
|
|
$
|
4,218
|
$
|
10,150
|
Non-cash items
included in net income and comprehensive income:
|
|
|
|
|
Depreciation and
amortization
|
|
9,068
|
7,863
|
|
Deferred income
taxes
|
|
356
|
(200)
|
|
Expense for defined
benefit pension plan
|
|
116
|
98
|
|
Expense for stock
options and deferred share units
|
|
69
|
68
|
|
(Gain) loss on sale
of assets
|
|
190
|
(1)
|
|
Unrealized foreign
currency (gain) loss
|
|
73
|
(298)
|
|
Unrealized gain on
financial guarantee contracts
|
|
(31)
|
(15)
|
Funds flow from
operations
|
|
14,059
|
17,665
|
Change in non-cash
working capital:
|
|
|
|
|
Accounts
receivable
|
|
1,377
|
(6,658)
|
|
Prepaid expenses and
other
|
|
(799)
|
(876)
|
|
Income taxes
recoverable
|
|
1,211
|
-
|
|
Accounts payable and
accrued liabilities
|
|
(5,228)
|
(5)
|
|
Deferred
revenue
|
|
(48)
|
(165)
|
|
|
|
10,572
|
9,961
|
Equity income from
joint ventures
|
|
(4,379)
|
(6,481)
|
Pension benefits
paid
|
|
(8)
|
(4)
|
Interest
paid
|
|
(170)
|
(1)
|
Income taxes expense
- current
|
|
1,361
|
3,476
|
Income taxes
paid
|
|
(1,361)
|
(1,824)
|
Net cash from
operating activities
|
|
6,015
|
5,127
|
|
|
|
|
|
Investing
Activities
|
|
|
|
Capital
expenditures
|
|
(5,017)
|
(18,064)
|
Change in non-cash
working capital related to capital
|
|
(7,267)
|
(1,372)
|
Net distributions
from investment in joint ventures
|
|
6,617
|
2,819
|
Change in term
deposits
|
|
-
|
5,000
|
Proceeds on sale of
assets
|
|
705
|
1
|
Net cash used in
investing activities
|
|
(4,962)
|
(11,616)
|
|
|
|
|
|
Financing
Activities
|
|
|
|
Change in operating
loan facility
|
|
(186)
|
-
|
Dividends
paid
|
|
(1,525)
|
(1,439)
|
Repurchase of share
capital
|
|
-
|
(427)
|
Net cash used in
financing activities
|
|
(1,711)
|
(1,866)
|
|
|
|
|
|
Decrease in
cash
|
|
(658)
|
(8,355)
|
Cash, beginning of
period
|
|
2,012
|
13,998
|
|
|
|
|
|
Cash, End of
Period
|
|
$
|
1,354
|
$
|
5,643
|
SOURCE AKITA Drilling Ltd.