Divestco Reports Q4 2013 Results
CALGARY, ALBERTA--(Marketwired - Apr 29, 2014) - Divestco Inc.
("Divestco" or the "Company") (TSX-VENTURE:DVT) announces its
operating results for the three months and year ended December 31,
2013.
Three months ended December 31, 2013
Divestco had a net profit of $3.5 million for the fourth quarter
of 2013 ($0.05 per share - basic and diluted) compared to a net
loss of $1.2 million ($0.02 per share - basic and diluted) for the
same period in 2012.
The Company generated revenue of $10.4 million in Q4 2013
compared to $7.3 million in Q4 2012, an increase of $3.1 million
(43%). This was mainly due to a revenue increase in both Seismic
Data segment of $5.1 million (616%) and Services segment of $0.3
million (16%) which was offset by a decrease in revenue in Software
and Data segment of $2.3 million (54%). Seismic Data segment Q4
2013 revenue in addition to traditional activity level included one
large proprietary data sale. The reduction in Software and Data
segment Q4 2013 revenue was primarily due to a significant log data
sale recognized in Q4 2012.
Operating expenses (excluding depreciation and amortization)
decreased by $1.7 million (25%) to $5.3 million in Q4 2013 from $7
million in Q4 2012. Salaries and wages were down $1.2 million (27%)
due to lower headcount. Occupancy costs were lower by $0.5 million
(42%) as the Company surrendered a floor of office space effective
January 1, 2013 and another floor effective June 1, 2013. There was
also a decrease in bad debt expense and bank charges partially
offset by an increase in digital map/information expense.
Depreciation and amortization increased by $0.2 million (13%)
mainly due to a higher depreciation on seismic data offset by a
lower amortization of deferred development costs and research and
development expense of Geomatics and Processing divisions.
EBITDA was $5.1 million in Q4 2013, a $4.8 million increase from
the same period in 2012. Funds from operations were $5.2 million
($0.08 per share - basic and diluted) for Q4 2013, compared to
$10,000 ($nil per share - basic and diluted) for the same period in
2012, an increase of $5.2 million primarily due to higher Seismic
Data sales activity as well as savings in salaries and wages
expense and occupancy costs.
Year ended December 31, 2013
Divestco had net income of $1.3 million for the year ended
December 31, 2013 ($0.02 per share - basic and diluted) which was
consistent with the net income for the year ended December 31,
2012. However, the income in 2013 was partially offset by the
recognition of a $1 million accounting loss (non-cash) from the
disposal of certain data library assets and a $0.7 million
impairment (non-cash) of leasehold improvements (net of tenant
inducements) associated with the surrender of office space in the
period. Excluding the loss and impairment, the Company would have
had a total net income of $3.0 million ($0.05 per share - basic and
diluted) for the year ended December 31, 2013.
The Company generated revenue of $34.0 million in 2013 compared
to $39.6 million in 2012, a decrease of $5.6 million (14%). Revenue
in the Software and Data segment decreased by $3.3 million (26%)
related to a significant log data sale in 2012. Revenues in
Geomatics and Processing divisions of Services segment were lower
by $1.0 million (22%) and $0.9 million (16%) respectively as
clients continued to spend less on exploration activities.
Operating expenses (excluding depreciation and amortization)
decreased by $4.1 million (15%) to $23.1 million for the year ended
December 31, 2013 from $27.2 million during the same period in
2012. Salaries and wages were down $2.9 million (16%) due to lower
headcount and profit-share accrual. Occupancy costs were also lower
as the Company surrendered a floor of office space effective
January 1, 2013 and another floor effective June 1, 2013. In
addition, stock-based compensation, professional fees, and bad debt
expenses were lower than in 2012. They were partially offset by an
increase in software licenses/maintenance and digital/map
information expenses. Depreciation and amortization decreased by
$3.8 million (35%) mainly due to a lower depreciation on seismic
data as the Company acquired more data in 2012 as compared to
2013.
Excluding the (non-cash) accounting loss and impairment of $1.7
million, EBITDA was $10.9 million for the year ended December 31,
2013, a $1.5 million (14%) decrease from $12.4 million for the same
period in 2012. The Company generated funds from operations of
$11.3 million ($0.17 per share - basic and diluted) in 2013,
compared to $11.7 million ($0.18 per share - basic and diluted) for
the same period in 2012, a decrease of $0.4 million (3%) primarily
due to lower log data revenue.
Working Capital
As at December 31, 2013, Divestco had a working capital deficit
of $2.3 million (excluding deferred revenue of $2.8 million),
compared to a working capital deficit of $7.5 million (excluding
deferred revenue of $2.4 million) as at December 31, 2012. The
improvement in working capital from the end of 2012 was a direct
result of debt restructuring, strong seismic cash sales and
significant reductions in operating costs. However, the industry
continued to experience lower than anticipated activity levels with
respect to exploration which had a negative impact on the Company's
services divisions: Geomatics, Processing and Land management
services for the year ended December 31, 2013.
Divestco had a funded debt to equity ratio of 0.61:1 as at
December 31, 2013 (0.65:1 as at December 31, 2012). The Company's
practice is to utilize an appropriate mix of debt and equity to
finance its current capital expenditures and growth initiatives.
Consistent with the year ended December 31, 2012, the strategy of
the Board of Directors and management is to operate the Company
with the lowest possible debt load in reaction to the volatility of
the industry. This is to ensure adequate financial flexibility to
meet the financial obligations, both current and long-term and as
part of the Company's effort to maintain a healthy statement of
financial position. The Company's strategy is to maintain a funded
debt to equity ratio of less than 1:1.
Operations Update
During 2013, Divestco completed two 3D seismic programs in
adding a total of 93 square kilometers to our proprietary database.
At the end of Q4, the company was in the process of acquiring
another 3D seismic program in the Alder region of Alberta. Software
has successfully restructured its division with the hiring of new
key personnel and has major releases planned throughout 2014.
Divestco's Services division made a determined push into
international markets which has resulted in several new processing
contracts in South America, Europe and Africa.
Mr. Stephen Popadynetz, CEO commented: "Q4 of 2013 was a
substantial turning point for Divestco. Despite the lack of new
seismic programs, Divestco was able to replace much of its lost
revenues from acquisitions with library sales. As the database
continues to expand, and the library sales associated with it will
also expand. As well, the Software and Data Division had decreased
one time revenues, but our overall recurring revenues saw a modest
increase and, despite the low industry activity, our Services
Division has implemented an aggressive expansion plan into
international markets which has started to show significant return.
As I have stated before, we can't increase the industry activity
levels, but we can diversify and control our costs. All the
measures taken by Divestco are starting to show positive results
and as we simplify and concentrate our businesses, we are
generating additional positive returns. The outlook for 2014 is
stronger than 2013 and with all the cost controls now firmly in
place, we can increase our profitability on any new revenue
increases. As well, we must continue to innovate rather than
waiting for the environment to improve. This is why our Software
group has produced a new slate of applications to be unveiled this
year and this is why our Processing group has moved so aggressively
into international markets. We also must manage the cash flows from
our operations and despite the challenging and changing economic
environment; Divestco's working capital position is substantially
improved from the end of fiscal 2012. As we look forward to 2014,
Divestco has improved virtually every aspect of the Company and is
well positioned to finally start focusing on growth again."
Non-GAAP Measures
The Company's consolidated financial statements have been
prepared in accordance with IFRS as issued by the IASB. Certain
measures in this document do not have any standardized meaning as
prescribed by IFRS and are considered non-GAAP measures. While
these measures may not be comparable to similar measures presented
by other issuers, they are described and presented to provide
shareholders, potential investors and other users with additional
information regarding the Company's results, liquidity, and its
ability to generate funds to finance its operations. These measures
include:
Earnings before interest, taxes, depreciation and amortization
("EBITDA")
Divestco uses EBITDA as a key measure to evaluate the
performance of its segments and divisions, as well as the Company
overall, with the closest IFRS measure being net income or net
loss. EBITDA is a measure commonly reported and widely used by
investors as an indicator of the Company's operating performance
and ability to incur and service debt, and as a valuation metric.
The Company believes EBITDA assists investors in comparing the
Company's performance on a consistent basis, without regard to
financing decisions and depreciation and amortization, which are
non-cash in nature and can vary significantly depending upon
accounting methods or non-operating factors such as historical
cost.
EBITDA is not a calculation based on IFRS and should not be
considered an alternative to net income or loss in measuring the
Company's performance. As well, EBITDA should not be used as an
exclusive measure of cash flow, because it does not consider the
impact of working capital growth, capital expenditures, debt
principal reductions and other sources and uses of cash, which are
disclosed in the consolidated statements of cash flows. While
EBITDA has been disclosed herein to permit a more complete
comparative analysis of the Company's operating performance and
debt servicing ability relative to other companies, investors
should be cautioned that EBITDA as reported by Divestco may not be
comparable in all instances to EBITDA as reported by other
companies. Investors should also carefully consider the specific
items included in Divestco's computation of EBITDA.
The following is a reconciliation of EBITDA with net income
(loss):
|
|
Three months ended December 31 |
|
Year ended December 31 |
|
|
(Thousands) |
2013 |
2012 |
|
2013 |
2012 |
|
|
Net Income (Loss) |
$ |
3,458 |
$ |
(1,232 |
) |
$ |
1,327 |
$ |
1,273 |
|
|
Income Tax Expense |
|
- |
|
- |
|
|
- |
|
(51 |
) |
|
Finance Costs |
|
215 |
|
251 |
|
|
1,007 |
|
531 |
|
|
Depreciation and Amortization |
|
1,454 |
|
1,292 |
|
|
6,889 |
|
10,646 |
|
|
EBITDA |
$ |
5,127 |
$ |
311 |
|
$ |
9,223 |
$ |
12,399 |
|
Working capital
Working Capital is calculated as current assets minus current
liabilities (excluding deferred revenue). Working capital provides
a measure that can be used to gauge Divestco's ability to meet its
current obligations.
Additional GAAP Measure
Funds from operations
Divestco reports funds from operations because it is a key
measure used by management to evaluate its performance and to
assess the ability of the Company to finance operating and
investing activities. Funds from operations exclude certain working
capital changes and other sources and uses of cash, which are
disclosed in the consolidated statements of cash flows.
Funds from operations is not a calculation based on IFRS and
should not be considered an alternative to the consolidated
statements of cash flows. Funds from operations is a measure that
can be used to gauge Divestco's capacity to generate discretionary
cash flow. Investors should be cautioned that funds from operations
as reported by Divestco may not be comparable in all instances to
funds from operations as reported by other companies. While the
closest IFRS measure is cash from operating activities, funds from
operations is considered relevant because it provides an indication
of how much cash generated by operations is available before
proceeds from divested assets and changes in certain working
capital items.
The following reconciles funds from operations with cash from
operating activities:
|
|
Three months ended December 31 |
|
Year ended December 31 |
|
|
(Thousands) |
2013 |
2012 |
|
2013 |
2012 |
|
|
Cash from Operating Activities |
$ |
3,684 |
$ |
(155 |
) |
$ |
8,498 |
$ |
14,892 |
|
|
Changes in Non-Cash Working Capital Balances Related to Operating
Activities |
|
1,337 |
|
(85 |
) |
|
1,938 |
|
(3,408 |
) |
|
Interest Paid |
|
168 |
|
219 |
|
|
846 |
|
374 |
|
|
Income Taxes Paid (Refunded) |
|
- |
|
31 |
|
|
- |
|
(184 |
) |
|
Funds from (used in) Operations |
$ |
5,189 |
$ |
10 |
|
$ |
11,282 |
$ |
11,674 |
|
Financial Highlights
| Summary Financial Results (Thousands, Except Per Share
Amounts) |
|
|
Three months ended December 31 |
|
Year ended December 31 |
|
|
2013 |
2012 |
|
$ Change |
|
% Change |
|
2013 |
2012 |
|
$ Change |
|
% Change |
|
| Revenue |
$ |
10,395 |
$ |
7,270 |
|
$ |
3,125 |
|
43 |
% |
$ |
33,979 |
$ |
39,628 |
|
$ |
(5,649 |
) |
-14 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating Expenses |
|
5,251 |
|
6,960 |
|
|
(1,709 |
) |
-25 |
% |
|
23,073 |
|
27,189 |
|
|
(4,116 |
) |
-15 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other Loss (Income) |
|
17 |
|
(1 |
) |
|
18 |
|
N/A |
|
|
1,683 |
|
40 |
|
|
1,643 |
|
4108 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| EBITDA (1) |
|
5,127 |
|
311 |
|
|
4,816 |
|
1549 |
% |
|
9,223 |
|
12,399 |
|
|
(3,176 |
) |
-26 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Finance Costs |
|
215 |
|
251 |
|
|
(36 |
) |
-14 |
% |
|
1,007 |
|
531 |
|
|
476 |
|
90 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Depreciation and Amortization |
|
1,454 |
|
1,292 |
|
|
162 |
|
13 |
% |
|
6,889 |
|
10,646 |
|
|
(3,757 |
) |
-35 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income (Loss) before Income Taxes |
|
3,458 |
|
(1,232 |
) |
|
4,690 |
|
N/A |
|
|
1,327 |
|
1,222 |
|
|
105 |
|
9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income Tax Expense (Reduction) |
|
- |
|
- |
|
|
- |
|
N/A |
|
|
- |
|
(51 |
) |
|
51 |
|
N/A |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net Income (Loss) |
$ |
3,458 |
$ |
(1,232 |
) |
$ |
4,690 |
|
N/A |
|
$ |
1,327 |
$ |
1,273 |
|
$ |
54 |
|
4 |
% |
|
|
Per Share - Basic and Diluted |
|
0.05 |
|
(0.02 |
) |
|
0.07 |
|
N/A |
|
|
0.02 |
|
0.02 |
|
|
- |
|
0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Funds from (used in) Operations (2) |
$ |
5,189 |
$ |
10 |
|
$ |
5,179 |
|
N/A |
|
$ |
11,282 |
$ |
11,674 |
|
$ |
(392 |
) |
-3 |
% |
|
|
Per Share - Basic and Diluted |
|
0.08 |
|
- |
|
|
0.08 |
|
N/A |
|
|
0.17 |
|
0.18 |
|
|
(0.01 |
) |
-6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares Outstanding |
|
67,050 |
|
66,758 |
|
|
N/A |
|
N/A |
|
|
67,050 |
|
66,758 |
|
|
N/A |
|
N/A |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted Average Shares Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted |
|
67,004 |
|
66,735 |
|
|
N/A |
|
N/A |
|
|
67,000 |
|
66,676 |
|
|
N/A |
|
N/A |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Position (Thousands) |
Balance as at |
|
|
Dec 31 |
|
Dec 31 |
|
Dec 31 |
|
|
2013 |
|
2012 |
|
2011 |
|
Total Assets |
$ |
40,721 |
|
$ |
41,945 |
|
$ |
43,761 |
|
Working Capital (Deficit) (1) |
|
(2,295 |
) |
|
(7,483 |
) |
|
297 |
|
Long-Term Financial Liabilities (2) |
|
9,357 |
|
|
7,622 |
|
|
8,610 |
- Excludes the current portion of deferred revenue of $2.8
million (December 31, 2012: $2.4 million; December 31, 2011: $4.6
million)
- Includes long-term debt obligations, deferred rent
obligations, sublease loss provision and other long-term
liabilities. The long-term debt obligations are comprised of the
Company's subordinated debt, shareholder loans and finance
leases.
Segment Review Summary
| Three months ended December 31, 2013 (Thousands) |
|
|
|
Software and Data |
|
Services |
|
Seismic Data |
|
Corporate & Other |
|
Total |
|
|
Revenue |
$ |
1,996 |
|
$ |
2,501 |
|
$ |
5,898 |
|
$ |
- |
|
$ |
10,395 |
|
|
EBITDA |
|
844 |
|
|
119 |
|
|
5,231 |
|
|
(1,067 |
) |
|
5,127 |
|
|
Finance costs (income) |
|
36 |
|
|
10 |
|
|
169 |
|
|
- |
|
|
215 |
|
|
Depreciation and Amortization |
|
624 |
|
|
145 |
|
|
579 |
|
|
106 |
|
|
1,454 |
|
|
Income (loss) before income taxes |
|
184 |
|
|
(36 |
) |
|
4,483 |
|
|
(1,173 |
) |
|
3,458 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three months ended December 31, 2012 (Thousands) |
|
|
|
Software |
|
|
Services |
|
|
Data |
|
|
Corporate & Other |
|
|
Total |
|
|
Revenue |
$ |
4,319 |
|
$ |
2,121 |
|
$ |
830 |
|
$ |
- |
|
$ |
7,270 |
|
|
EBITDA |
|
2,523 |
|
|
(760 |
) |
|
(165 |
) |
|
(1,287 |
) |
|
311 |
|
|
Finance costs (income) |
|
68 |
|
|
22 |
|
|
161 |
|
|
- |
|
|
251 |
|
|
Depreciation and Amortization |
|
788 |
|
|
221 |
|
|
156 |
|
|
127 |
|
|
1,292 |
|
|
Income (loss) before income taxes |
|
1,667 |
|
|
(1,003 |
) |
|
(482 |
) |
|
(1,414 |
) |
|
(1,232 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Year ended December 31, 2013 (Thousands) |
|
|
|
Software |
|
|
Services |
|
|
Data |
|
|
Corporate & Other |
|
|
Total |
|
|
Revenue |
$ |
9,427 |
|
$ |
10,946 |
|
$ |
13,606 |
|
$ |
- |
|
$ |
33,979 |
|
|
EBITDA |
|
2,972 |
|
|
423 |
|
|
10,813 |
|
|
(4,985 |
) |
|
9,223 |
|
|
Finance costs (income) |
|
292 |
|
|
137 |
|
|
578 |
|
|
- |
|
|
1,007 |
|
|
Depreciation and Amortization |
|
2,526 |
|
|
614 |
|
|
3,270 |
|
|
479 |
|
|
6,889 |
|
|
Income (loss) before income taxes |
|
154 |
|
|
(328 |
) |
|
6,965 |
|
|
(5,464 |
) |
|
1,327 |
|
|
Loss on sale of intangibles and property and equipment |
|
(1,005 |
) |
|
- |
|
|
- |
|
|
(678 |
) |
|
(1,683 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Year ended December 31, 2012 (Thousands) |
|
|
|
Software |
|
|
Services |
|
|
Data |
|
|
Corporate & Other |
|
|
Total |
|
|
Revenue |
$ |
9,414 |
|
$ |
17,266 |
|
$ |
13,784 |
|
$ |
- |
|
$ |
40,464 |
|
|
EBITDA |
|
3,541 |
|
|
3,620 |
|
|
10,651 |
|
|
(11,673 |
) |
|
6,139 |
|
|
Finance costs (income) |
|
- |
|
|
(3 |
) |
|
(6 |
) |
|
768 |
|
|
759 |
|
|
Depreciation and Amortization |
|
3,453 |
|
|
1,098 |
|
|
3,632 |
|
|
1,721 |
|
|
9,904 |
|
|
Income (loss) before income taxes |
|
88 |
|
|
2,525 |
|
|
7,025 |
|
|
(14,162 |
) |
|
(4,524 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Divestco Inc. |
| Condensed Consolidated Interim Statements of Financial
Position |
|
|
At December 31 |
| (Thousands - Audited) |
2013 |
2012 |
| Assets |
|
|
|
|
|
|
|
|
|
| Current Assets |
|
|
|
|
|
Cash |
$ |
417 |
$ |
1,320 |
|
Funds held in trust |
|
- |
|
18 |
|
Accounts receivable |
|
9,136 |
|
7,134 |
|
Prepaid expenses, supplies and deposits |
|
300 |
|
357 |
|
|
Income taxes receivable |
|
502 |
|
196 |
|
Total current assets |
|
10,355 |
|
9,025 |
|
|
|
|
|
| Equity-accounted investees |
|
133 |
|
137 |
| Participation surveys in progress |
|
4,733 |
|
3,508 |
| Property and equipment |
|
2,869 |
|
4,607 |
| Intangible assets |
|
22,631 |
|
24,668 |
|
|
|
|
|
| Total assets |
$ |
40,721 |
$ |
41,945 |
|
|
|
|
|
| Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
| Current Liabilities |
|
|
|
|
|
Bank indebtedness |
$ |
2,996 |
$ |
4,450 |
|
Accounts payable and accrued liabilities |
|
6,935 |
|
9,624 |
|
Deferred revenue |
|
2,756 |
|
2,420 |
|
Current loss on sublease loss provision |
|
336 |
|
326 |
|
Current portion of long-term debt obligations |
|
2,311 |
|
1,986 |
|
|
Current portion of tenant inducements |
|
72 |
|
122 |
|
Total current liabilities |
|
15,406 |
|
18,928 |
|
|
|
|
|
| Deferred rent obligations |
|
451 |
|
189 |
| Long-term debt obligations |
|
5,591 |
|
4,115 |
| Sublease loss provision |
|
668 |
|
1,006 |
| Tenant Inducements |
|
750 |
|
1,389 |
| Total liabilities |
|
22,866 |
|
25,627 |
|
|
|
|
|
| Shareholders' Equity |
|
|
|
|
|
Equity instruments |
|
7,266 |
|
7,216 |
|
Contributed surplus |
|
7,989 |
|
7,829 |
|
|
Retained earnings |
|
2,600 |
|
1,273 |
|
|
Total shareholders' equity |
|
17,855 |
|
16,318 |
|
|
|
|
|
| Total liabilities and shareholders' equity |
$ |
40,721 |
$ |
41,945 |
|
|
|
|
|
|
|
|
|
|
| Divestco Inc. |
| Condensed Consolidated Interim Statements of Income and
Comprehensive Income |
|
|
Year ended December 31 |
|
| (Thousands, Except Per Share Amounts - Audited) |
2013 |
2012 |
|
| Revenue |
$ |
33,979 |
$ |
39,628 |
|
|
|
|
|
|
|
| Operating expenses |
|
|
|
|
|
|
Salaries and benefits |
|
14,775 |
|
17,667 |
|
|
General and administrative |
|
8,138 |
|
9,213 |
|
|
Depreciation and amortization |
|
6,889 |
|
10,646 |
|
|
Other loss |
|
1,683 |
|
40 |
|
|
|
Share-based payments |
|
160 |
|
309 |
|
|
|
Total operating expenses |
|
31,645 |
|
37,875 |
|
|
|
|
|
|
|
| Finance costs |
|
1,007 |
|
531 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income before income taxes |
|
1,327 |
|
1,222 |
|
|
|
|
|
|
|
| Income taxes |
|
|
|
|
|
|
|
Current |
|
- |
|
(51 |
) |
|
|
|
|
|
|
| Net income and comprehensive income for the year |
$ |
1,327 |
$ |
1,273 |
|
|
|
|
|
|
|
| Net income per share |
|
|
|
|
|
|
Basic and Diluted |
$ |
0.02 |
$ |
0.02 |
|
|
|
|
|
|
|
| Weighted average number of shares |
|
|
|
|
|
|
|
Basic and Diluted |
|
66,989 |
|
66,676 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Divestco Inc. |
| Condensed Consolidated Interim Statements of Changes in
Equity |
|
| (Thousands - Audited) |
Number of Shares Issued |
Share Capital |
|
Number of Warrants Issued |
|
Warrants |
|
Equity Instruments |
|
Contributed Surplus |
|
Retained Earnings |
|
Total Equity |
|
| Balance as at January 1, 2012 |
66,610 |
$ |
74,571 |
|
16,280 |
|
$ |
1,860 |
|
$ |
76,431 |
|
$ |
5,663 |
|
$ |
(67,383 |
) |
$ |
14,711 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reduction of stated capital and deficit |
|
|
(67,383 |
) |
|
|
|
|
|
|
(67,383 |
) |
|
|
|
|
67,383 |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income and comprehensive income for the year |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,273 |
|
|
1,273 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Transactions with owners, recorded in equity
contributions by and distributions to owners: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Class A common shares as service awards |
128 |
|
25 |
|
|
|
|
|
|
|
25 |
|
|
|
|
|
|
|
|
25 |
|
|
Issuance of Class A common shares on exercise of PSUs |
20 |
|
3 |
|
|
|
|
|
|
|
3 |
|
|
|
|
|
|
|
|
3 |
|
|
Reclassification on exercise of PSUs |
|
|
|
|
|
|
|
|
|
|
|
|
|
(3 |
) |
|
|
|
|
(3 |
) |
|
Reclassification on expiry of warrants |
|
|
|
|
(16,280 |
) |
|
(1,860 |
) |
|
(1,860 |
) |
|
1,860 |
|
|
|
|
|
- |
|
|
Share-based payments |
|
|
|
|
|
|
|
|
|
|
|
|
|
309 |
|
|
|
|
|
309 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance as at December 31, 2012 |
66,758 |
$ |
7,216 |
|
- |
|
$ |
- |
|
$ |
7,216 |
|
$ |
7,829 |
|
$ |
1,273 |
|
$ |
16,318 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income and comprehensive income for the year |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,327 |
|
|
1,327 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Transactions with owners, recorded in equity
contributions by and distributions to owners: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Class A common shares as service awards |
292 |
|
50 |
|
|
|
|
|
|
|
50 |
|
|
|
|
|
|
|
|
50 |
|
|
|
Share-based payments |
|
|
|
|
|
|
|
|
|
|
|
|
|
160 |
|
|
|
|
|
160 |
|
| Balance as at December 31, 2013 |
67,050 |
$ |
7,266 |
|
- |
|
$ |
- |
|
$ |
7,266 |
|
$ |
7,989 |
|
$ |
2,600 |
|
$ |
17,855 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Divestco Inc. |
| Condensed Consolidated Interim Statements of Cash Flows |
|
|
|
Year ended December 31 |
|
|
(Thousands - Audited) |
2013 |
|
2012 |
|
|
Cash from (used in) operating activities |
|
|
|
|
|
|
|
Net income (loss) for the year |
$ |
1,327 |
|
$ |
1,273 |
|
|
Items not affecting cash: |
|
|
|
|
|
|
|
Equity investment loss |
|
(3 |
) |
|
(10 |
) |
|
Depreciation and amortization |
|
6,889 |
|
|
10,646 |
|
|
Amortization of tenant inducements |
|
(93 |
) |
|
(117 |
) |
|
Deferred rent obligations |
|
262 |
|
|
(936 |
) |
|
Income taxes |
|
- |
|
|
(51 |
) |
|
Loss on disposal of intangibles |
|
1,005 |
|
|
- |
|
|
Impairment of property and equipment |
|
678 |
|
|
- |
|
|
Unrealized foreign exchange loss |
|
- |
|
|
4 |
|
|
Non-cash employment benefits |
|
50 |
|
|
25 |
|
|
Share-based payments |
|
160 |
|
|
309 |
|
|
Finance costs |
|
1,007 |
|
|
531 |
|
|
Funds from operations |
|
11,282 |
|
|
11,674 |
|
|
|
|
|
|
|
|
|
|
Changes in non-cash working capital balances |
|
(1,938 |
) |
|
3,408 |
|
|
Interest paid |
|
(846 |
) |
|
(374 |
) |
|
Income taxes paid |
|
- |
|
|
184 |
|
|
Net cash from operating activities |
|
8,498 |
|
|
14,892 |
|
|
|
|
|
|
|
|
|
|
Cash from (used in) financing activities |
|
|
|
|
|
|
|
Bank indebtedness |
|
(1,454 |
) |
|
750 |
|
|
Repayment of long-term debt obligations |
|
(2,617 |
) |
|
(1,965 |
) |
|
Deferred financing costs |
|
(298 |
) |
|
- |
|
|
Proceeds received from long-term debt obligations (net of committed
revolver repayments) |
|
4,325 |
|
|
2,210 |
|
|
Net cash from (used in) financing activities |
|
(44 |
) |
|
995 |
|
|
|
|
|
|
|
|
|
|
Cash from (used in) investing activities |
|
|
|
|
|
|
|
Additions to intangible assets |
|
(3,604 |
) |
|
(14,197 |
) |
|
Decrease in participation surveys in progress |
|
(1,225 |
) |
|
1,600 |
|
|
Purchase of property and equipment |
|
(408 |
) |
|
(1,320 |
) |
|
Additions to tenant inducements |
|
- |
|
|
118 |
|
|
Lease incentive |
|
144 |
|
|
- |
|
|
Payments towards sublease loss provision |
|
(356 |
) |
|
(357 |
) |
|
Investment in equity-accounted investees |
|
(200 |
) |
|
- |
|
|
Advances from equity-accounted investees |
|
458 |
|
|
14 |
|
|
Deferred development costs |
|
(1,824 |
) |
|
(2,353 |
) |
|
Changes in non-cash working capital balances |
|
(2,342 |
) |
|
381 |
|
|
Net cash used in investing activities |
|
(9,357 |
) |
|
(16,114 |
) |
|
|
|
|
|
|
|
|
|
Decrease in cash |
|
(903 |
) |
|
(227 |
) |
|
|
|
|
|
|
|
|
|
Cash, beginning of year |
|
1,320 |
|
|
1,547 |
|
|
|
|
|
|
|
|
|
|
Cash, end of year |
$ |
417 |
|
$ |
1,320 |
|
About the Company
Divestco provides innovative geoscience solutions to Energy and
Service companies worldwide. Our customers predominantly operate in
geology, geophysics, land and engineering and we work with our
clients to ensure they have the right solutions, at the right time,
to help them make more informed decisions. Commitment, innovation,
accountability and agility form the cornerstone of our values and
enable us to consistently provide reliable solutions and
exceptional, personalized service in all of the core areas in which
we operate. Divestco provides Software & Data, Seismic
Processing, Geomatics Services, Seismic Data & Brokerage, and
Land Services. Divestco is headquartered in Calgary and trades on
the TSX Venture Exchange under the symbol "DVT".
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release.
This press release contains forward-looking information
related to the Company's capital expenditures, projected growth,
view and outlook with respect to future oil and gas prices and
market conditions, and demand for its products and services.
Statements that contain words such as "could', "should", "can",
"anticipate", "expect", "believe", "will", "may" and similar
expressions and statements relating to matters that are not
historical facts constitute "forward-looking information" within
the meaning applicable by Canadian securities legislation. Although
management of the Company believes that the expectations reflected
in such forward-looking information are reasonable, there can be no
assurance that such expectations will prove to have been correct
because, should one or more of the risks materialize, or should the
assumptions underlying forward-looking statements or
forward-looking information prove incorrect, actual results may
vary materially from those described in this press release as
intended, planned, anticipated, believed, estimated or expected.
Readers should not place undue reliance on forward-looking
statements or forward-looking information. All of the
forward-looking statements and forward-looking information of the
Company contained in this press release are expressly qualified, in
their entirety, by this cautionary statement. Except where required
by law, the Company does not assume any obligation to update these
forward-looking statements or forward-looking information if
conditions or opinions should change.
In particular, this press release contains forward-looking
statements pertaining to the following: Company's ability to keep
debt and liquidity at acceptable levels, improve/maintain its
working capital position and maintain profitability in the current
economy; availability of external and internal funding for future
operations; relative future competitive position of the Company;
nature and timing of growth; oil and natural gas production levels;
planned capital expenditure programs; supply and demand for oil and
natural gas; future demand for products/services; commodity prices;
impact of Canadian federal and provincial governmental regulation
on the Company; expected levels of operating costs, finance costs
and other costs and expenses; future ability to execute
acquisitions and dispositions of assets or businesses; expectations
regarding the Company's ability to raise capital and to add to
seismic data through new seismic shoots and acquisition of existing
seismic data; treatment under tax laws; and new accounting
pronouncements.
These forward-looking statements are based upon assumptions
including: future prices for crude oil and natural gas; future
interest rates and future availability of debt and equity financing
will be at levels and costs that allow the Company to manage,
operate and finance its business and develop its software products
and various oil and gas datasets including its seismic data
library, and meet its future obligations; the regulatory framework
in respect of royalties, taxes and environmental matters applicable
to the Company and its customers will not become so onerous on both
the Company and its customers as to preclude the Company and its
customers from viably managing, operating and financing its
business and the development of its software and data; and that the
Company will continue to be able to identify, attract and employ
qualified staff and obtain the outside expertise as well as
specialized and other equipment it requires to manage, operate and
finance its business and develop its properties.
These forward-looking statements are subject to numerous
risks and uncertainties, certain of which are beyond the Company's
control, including: general economic, market and business
conditions; volatility in market prices for crude oil and natural
gas; ability of Divestco's clients to explore for, develop and
produce oil and gas; availability of financing and capital;
fluctuations in interest rates; demand for the Company's product
and services; weather and climate conditions; competitive actions
by other companies; availability of skilled labour; failure to
obtain regulatory approvals in a timely manner; adverse conditions
in the debt and equity markets; and government actions including
changes in environment and other regulation.
Divestco Inc.Mr. Stephen PopadynetzCEO, President and
CFO587-952-8152Divestco Inc.Mr. Danny ChiarastellaVice President,
Finance587-952-8027www.divestco.com
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