CALGARY, Aug. 19, 2015 /CNW/ - Gemini Corporation
(GKX-TSXV) announces its second quarter financial results for the
period ended June 30, 2015.
Revenue in the second quarter of 2015 totalled $58 million, which was a 74% increase over the
$34 million achieved in the second
quarter of 2014. This brings year to date revenue to a total of
$99 million compared to $62 million for the same period last year. The
revenue growth in the second quarter was generated within the Field
Solutions segment and was attributable to fabrication activity and
the major rail loading terminal project that the Corporation has
been completing for an alliance client. The current market
uncertainties and lack of activity is creating extremely
competitive pricing conditions that are taking their toll on
margins and overall profitability. General indications from clients
are that it is unlikely that pricing conditions will change
markedly until there is a recovery in oil and gas prices.
Second quarter gross profit for 2015 was $0.3 million compared to $4.6 million in the same period of 2014 and the
results for the year to date gross profit are $3.0 million versus $8.3
million, respectively. This significant decline is a result
of unrecoverable costs incurred on the rail loading terminal
project combined with the underutilization of staff and employment
termination costs. It is expected that the margin compression being
experienced throughout the industry will continue to constrain
profitability.
The Corporation's 2015 second quarter net loss was $2.7 million (3.5¢ per share – basic) compared to
the 2014 second quarter net income of $0.4
million (0.8¢ per share – basic). The net loss for the six
months ended June 30, 2015 totalled
$4.4 million (5.8¢ per share – basic)
compared to a net income of $0.2
million (0.4¢ per share – basic) for the same period of
2014.
The Corporation has entered into a contract amendment for the
rail loading terminal project. The completion date for the project
has been extended to mid-September due to certain schedule delays,
and arrangements to manage cost overruns have been agreed. The
Corporation and its client are working together to manage and
mitigate project costs. It is anticipated that there may be
additional unrecoverable costs incurred prior to the completion of
the project.
The Corporation has taken steps to augment its working capital
position through the recently announced sale and leaseback
agreement for the land and buildings at its Ponoka, Alberta fabrication facility. The land
and buildings will be sold for $5.5
million, less any transaction fees, and is expected to close
before August 28, 2015.
"This year has been extremely challenging for our entire
organization", stated Doug
Lautermilch, Gemini's President and CEO. "The market
conditions have been very difficult and compounding these
challenges are the schedule and cost issues we have encountered on
our largest project. Our focus is on managing the economic
adversity we are facing and to position the organization for growth
when the market begins to recover."
About Gemini Corporation
Gemini Corporation is a
professional services firm that designs, builds and maintains
energy and industrial facilities. We provide regulatory,
environmental, engineering, fabrication, installation and
maintenance solutions for clients through stand-alone or integrated
service delivery models. Our design-build capabilities
differentiate Gemini and provide value-added benefits for clients,
such as cost certainty, schedule compression and one point of
accountability. The Corporation's principal target markets are
midstream oil and gas, oil and gas production, in-situ heavy oil,
and oil and gas processing across western Canada.
Shares of Gemini trade on the TSX Venture Exchange under the
symbol "GKX". For more information about the Corporation and its
services, go to www.geminicorp.ca.
Gemini's 2015 second quarter report will be filed on SEDAR at
http://www.sedar.com by August 21,
2015.
CONSOLIDATED FINANCIAL HIGHLIGHTS
Operating
Highlights ($'000)
|
Three Months
Ended
|
Six Months
Ended
|
|
|
|
|
June
30,
|
June
30,
|
June
30,
|
June
30,
|
|
2015
|
2014
|
2015
|
2014
|
|
|
|
|
|
Revenue
|
$
|
58,330
|
$
|
33,507
|
$
|
99,224
|
$
|
61,725
|
Gross
profit
|
324
|
4,646
|
3,018
|
8,326
|
Income before
interest & taxes
|
(3,325)
|
756
|
(5,485)
|
627
|
Net (loss)
income
|
$
|
(2,677)
|
$
|
420
|
$
|
(4,444)
|
$
|
242
|
|
|
|
|
|
Earnings per share
(basic)
|
$
|
(0.035)
|
$
|
0.008
|
$
|
(0.058)
|
$
|
0.004
|
Earnings per share
(diluted)
|
$
|
(0.035)
|
$
|
0.006
|
$
|
(0.058)
|
$
|
0.003
|
Financial
Position Highlights ($'000)
|
June
30,
|
December
31,
|
2015
|
2014
|
Working
capital
|
$
|
14,799
|
$
|
19,635
|
Total
assets
|
64,860
|
65,342
|
Shareholders'
equity
|
26,543
|
30,712
|
Disclaimer
This news release may contain forward looking information
that represents Gemini's internal projections, expectations,
estimates or beliefs concerning, among other things, the timing of
any recovery in oil and gas prices, timing for the completion of
the rail loading terminal project, the extent of the cost overruns
and additional unrecoverable costs relating to the rail
loading terminal project, expected closing and closing date of the
sale and leaseback transaction with 1735465 Alberta Ltd., the
recovery of the markets for the Corporation's products and
services, future operating results and various components thereof
or Gemini's future economic performance. All statements other than
the statements of historical fact may be forward-looking
statements. In some cases, forward-looking statements can be
identified by terminology such as "may", "will", "should",
"expects", "projects", "plans", "anticipates", and similar
expressions. The projections, estimates and beliefs contained in
such forward-looking statements are based on management's
assumptions relating to Gemini's performance and competition within
the sectors in which it competes, the continuation of the current
regulatory and tax regimes in the jurisdictions in which Gemini
operates, and necessarily involve known and unknown risks and
uncertainties, including risks and assumptions relating to client
service demand, field service costs, labour rates, and other
factors that may cause actual performance and financial results in
future periods to differ materially from any projections of future
performance or results expressed or implied by such forward-looking
statements. Accordingly, readers are cautioned that events or
circumstances could cause results to differ materially from those
predicted or suggested. The Corporation does not undertake to
update any forward-looking information in this document whether as
to new information, future events or otherwise.
The TSX Venture Exchange does not accept responsibility for
the adequacy or accuracy of this release.
SOURCE Gemini Corporation