EANS-News: C.A.T. oil AG
C.A.T. oil AG benefits from initiatives to streamline
- EBITDA improved by 10.3% YoY despite lower revenues - Cost of sales reduced by 16.9%, administrative expenses lowered by 32.1% - Cash flow from operating activities up by 80.7% YoY - Order book grows to EUR 198 million in May on robust demand for core services
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Wien (euro adhoc) - May 29, 2009 - C.A.T. oil AG (O2C, ISIN: AT0000A00Y78), one of the leading providers of oil and gasfield services in Russia and Kazakhstan, today announced the results for the first quarter 2009. During the first three months C.A.T. oil realized first effects from its comprehensive cost cutting program which was initiated to streamline operations and increase efficiency. As a result, the company improved its EBITDA by 10.3% YoY to EUR 8.1 million (Q1 2008: EUR 7.3 million) despite lower group revenues. The EBITDA margin went up to 15.0% in the reporting period from 11.1% in the prior-year-quarter.
In the fourth quarter 2008 C.A.T. oil had renegotiated contracts with suppliers and subcontractors and had implemented a program to adjust the number of employees in Russia and Kazakhstan to the changed market conditions. As a consequence, cost of sales were brought down by 16.9% to EUR 47.6 million (Q1 2008: EUR 57.3 million) and general and administrative costs were reduced by 32.1% to EUR 4.4 million (Q1 2008: EUR 6.6 million) in the first quarter 2009. Personnel expenses declined by 23.8% due to lower wage levels and the reduced workforce which amounted to 3,228 employees (Q1 2008: 3,449 employees). Cost saving effects from the Company´s cost cutting measures were, however, partly offset by provisions of EUR 1.5 million attributable to operating costs for seismic operations in Nigeria.
Revenues impacted by economic slowdown, seasonal effects and Rouble devaluation
The streamlining of operations offset declining group revenues which were mainly influenced by three factors: the economic slowdown as well as harsh weather conditions caused a decrease in total job count by 7.2% to 667 jobs (Q1 2008: 719 jobs). In addition, the unfavorable exchange rate of the Russian Rouble against the Euro had a significant impact. Revenues therefore declined by 18.4% to EUR 53.8 million (Q1 2008: EUR 65.9 million), although they remained stable in local currencies. Average revenues per job were par-ticularly impacted by the devaluation of the Rouble and fell by 12.2% YoY to TEUR 81 (Q1 2008: TEUR 92). Due to the greater complexity of service jobs carried out, however, C.A.T. oil was able to slightly increase revenues per job in local currencies by 3.9% YoY for hydraulic fracturing and 4.3% YoY for sidetrack drilling despite the ongoing price pressure for oil and gasfield ser-vices in Russia and Kazakhstan.
C.A.T. oil´s gross profit for the first quarter amounted to EUR 6.1 million (Q1 2008: EUR 8.6 million) which mainly reflected the lower level of revenues on a Euro basis. Earnings before interest and corporate tax (EBIT) was at EUR 1.3 million (Q1 2008: EUR 2.2 million), and EBIT margin amounted to 2.3% (Q1 2009: 3.3%).
Currency translation losses significantly impact financial result and pre-tax result
For the first quarter 2009 C.A.T. oil reported a net financial result of EUR -3.5 million (Q1 2008: EUR -0.5 million) which was affected by unrealized foreign currency translation losses of EUR 2.1 million as well as realized foreign currency translation losses of EUR 0.7 million on euro-denominated inter-company loans. Mainly as a consequence of the increased financial expenses C.A.T. oil reported a pre-tax loss of EUR 2.2 million (Q1 2008: EUR 1.7 million).
C.A.T. oil´s net result amounted to EUR -0.9 million (Q1 2008: EUR 0.4 mil-lion); an incurred net income tax gain of EUR 1.3 million (Q1 2008: EUR -1.2 million) failed to offset pre-tax losses. Losses per share amounted to EUR 0.019, compared to earnings per share of EUR 0.009 in Q1 2008.
Solid financial position and extremely strong equity base
C.A.T. oil´s cash flow from operating activities grew by 80.7% to EUR 13.9 mil-lion compared to EUR 7.7 million in the same quarter of 2008. Cash flow from investing activities was a net outflow of EUR 3.2 million and was significantly lower than in Q1 2008 (net outflow of EUR 8.7 million) as the Company reduced its capital expenditures to a maintenance level. Cash flow from financing activities was a net outflow of EUR 9.1 million in Q1 2009 (Q1 2008: net inflow of EUR 0.7 million) and reflects an early repayment of EUR 10 million of the EUR 30 million credit line which had been drawn in the fourth quarter 2008 and which is part of the long-term total credit line C.A.T. oil had secured in November 2008. Cash and cash equivalents amounted to EUR 14.1 million at 31 March 2009 and remained effectively stable compared to the level of EUR 14.4 million at 31 December 2008. Since a strong equity base is critical for its corporate strategy, the Company kept its equity ratio at a very healthy level of 72.7% on 31 March 2009 (31 December 2008: 73.4%).
Continued focus on increasing efficiency and further strengthened customer relationships
Following its massive capacity expansion between 2006 and 2008, C.A.T. oil is now focusing on making even more flexible and intelligent use of its existing technologies. The Company will therefore keep capital expenditures below historic levels and, apart from one sidetrack drilling rig to be delivered in the first half of 2009, use investments primarily for material procurement and maintenance. Despite the continuing economic and financial crisis, C.A.T. oil sees itself in a solid position to deal with the challenging market conditions.
Manfred Kastner, CEO of C.A.T. oil, said: "We have just received another sidetrack drilling order worth EUR 10 million by Russia´s largest oil producer LUKOIL, raising our total order book volume to EUR 198 million. This proves yet again that our customers appreciate our integrated service approach, our state-of-the-art-technology and our high quality standards. As demand for our services remains robust we see ourselves well prepared for the challenges ahead. We will, moreover, continue with our disciplined cost cutting program and remain committed to further streamline our operations, thereby preparing C.A.T. oil for the time when markets will fundamentally recover and we will be able to make full use of our capabilities and further improve our competitive position in Russia and Kazakhstan."
Press contact: A&B Financial Dynamics
Carolin Amann Lucie Kimmich Tel.: +49 (0)69 92037-132 Tel.: +49 (0)69 92037-183 Email: email@example.com Email: firstname.lastname@example.org
About C.A.T. oil AG:
Austria-based C.A.T. oil AG (O2C, ISIN: AT0000A00Y78) is one of the leading providers of oil- and gasfield services in Russia and Kazakhstan and is listed in the Prime Standard of the Frankfurt Stock Exchange. One of C.A.T. oil´s core businesses is hydraulic fracturing, a process which helps to open up oil- and gas-bearing rock formations in order to increase or even enable oil and gas production. Hydraulic fracturing is a method to generate high pressure in the oil or gas reservoirs concerned. This pressure causes cracks to appear in the rock through which oil or gas can be produced in larger quantities from the production well, and hence efficiently boosts extraction, particularly in the case of deposits that are difficult to develop or low-output wells. In addi-tion, hydraulic fracturing can be used to revitalize wells which have previously been idle.
Since its IPO in 2006 C.A.T. oil has also increasingly invested in sidetrack drilling and thus built up a second core business. Sidetrack drilling is a method which uses an already existing wellbore to create another one and is used to either avoid irreparable damages of the wellbore or the equipment or to reach further parts of the reservoir. Over the past few years demand for the high-margin sidetrack drilling service has con-tinuously increased. The method allows to efficiently build up additional production capacities and to further exploit the potential of a well. In the field of sidetrack drilling, C.A.T. oil is already number 2 in Russia.
The Company has its headquarters in Vienna and employed an average of 3,228 people in the first quarter of 2009, most of whom are based in Russia and Kazakh-stan. Customers include leading oil and gas producers such as Gazprom, KazMunai-Gaz, LUKOIL, Rosneft, and TNK-BP.
C.A.T. oil has been a member of the SDax since September 18, 2006.
Key financial figures for the first quarter 2009
[in million EUR] Q1 2009 Q1 2008 Change in % Revenues 53.8 65.9 -18.4 Cost of sales 47.6 57.3 16.9 Gross profit 6.1 8.6 -10.6 EBITDA 8.1 7.3 10.3 EBITDA margin 15.0% 11.1% EBIT 1.3 2.2 -42.4 EBIT margin 2.3% 3.3% Net result for period -0.91 0.44 46.9 Earnings per share (in EUR) -0.019 0.009 Equity Ratio 72.7% 77.7% Cash flow from operating activities 13.9 7.7 80.7 Cash flow from investing activities -3.2 -8.7 -63.6 Cash flow from financing activities -9.1 0.7 -1347.4 Cash and cash equivalents 14.1 12.1 16.3 Total job count 667 719 -7.2 Per-job revenue (in thou. EUR) 81 92 Employees 3,228 3,449
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Branche: Oil & Gas - Upstream activities
Index: SDAX, Classic All Share, Prime All Share
Börsen: Frankfurt / regulated dealing/prime standard