EANS-News: C.A.T. oil AG
C.A.T. oil AG well on track in first six months of
2009
Wien (euro adhoc) -
Cost of sales reduced by 16.7% YoY in H1 2009 to EUR 94.2 million EBITDA margin expanded to 19.1% YoY Cash flow from operating activities increased by 44.9 % YoY Job count at all-time-high of 1,525 in H1 2009
Corporate news transmitted by euro adhoc. The issuer/originator is solely responsible for the content of this announcement.
quarterly report/First half 2009 results
31 August 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 half of Fiscal Year 2009. In the reporting period the Company continued to streamline its operations and consequently followed its strict cost management which had been initiated at the end of 2008 to improve profitability. The successful implementation of these measures is reflected in an increased EBITDA margin. At the same time C.A.T. oil followed its high-quality approach in operations and delivered reliable services in a timely manner, thereby further strengthening its market position in Russia and Kazakhstan. Thanks to the growing demand for the Company´s services, particularly in the second quarter, C.A.T. oil´s job count reached an all time high in the first half of 2009.
Due to the comprehensive cost cutting program the Company was able to reduce cost of sales by 16.7% YoY to EUR 94.2 million (H1 2008: EUR 113.1 million). Renegotiated contracts with suppliers and subcontractors and the adjustment of workforce contributed significantly to this reduction. In addition, C.A.T. oil lowered general and administrative costs by 36.0% YoY to EUR 8.2 million (H1 2008: EUR 12.7 million), decreased wages and salaries by 26.6% YoY to EUR 15.9 million (H1 2008: EUR 21.7 million) and reduced direct costs by 23.9% YoY to EUR 22.3 million (H1 2008: EUR 29.3 million). In Q2 2009, costs of sales were reduced by 16.5% YoY to EUR 46.6 million (Q2 2008: EUR 55.8 million). C.A.T. oil´s general and administrative costs were down 40.0% YoY to EUR 3.7 million in the second quarter (Q2 2008: EUR 6.2 million), wages and salaries were reduced by 30.5% YoY to EUR 7.7 million (Q2 2008: EUR 11.1 million) and direct costs were lowered by 26.3% YoY to EUR 10.4 million (Q2 2008: EUR 14.1 million).
All time high in job count due to efficiency improvements and seasonal effects
Thanks to an improved use of capacities on one hand, as well as seasonal effects and higher demand on the other hand, C.A.T. oil was able to boost the total number of jobs in the second quarter by 28.6% QoQ to 858 (Q1 2008: 667), thereby increasing the total number of jobs in H1 2009 by 2.5% YoY to an all time high of 1,525 jobs (H1 2008: 1,488 jobs).
Revenue development impacted by Rouble devaluation
The increase in total number of jobs performed has not been reflected in C.A.T. oil´s revenue development primarily due to the continued weakness in Rouble/Euro exchange rate and somewhat softer Rouble prices for sidetrack drilling services. Thus, although the Company was able to increase revenues in local currencies by 2.5% YoY, they have declined in Euro by 15.7% YoY to EUR 117.5 million (H1 2008: EUR 139.4 million). In Q2 2009, revenues also rose in Rouble terms, by 4.5% YoY, however decreased by 13.2% YoY to EUR 63.8 million (Q2 2008: EUR 73.5 million).
Average per job revenues in the first six months declined by 17.7% YoY to EUR thou. 77.1 (H1 2008: EUR thou. 93.7). In Q2 2009, average per job revenue declined 23.2% YoY to EUR thou. 74.3 (Q2 2008: EUR thou. 96.8).
Cost management reflected in increased EBITDA margin
The Company´s earnings before interest, corporate tax, depreciation and am-ortization (EBITDA) amounted to EUR 22.4 million in the first half of the year, down 9.0% YoY (H1 2008: EUR 24.6 million), and was negatively impacted by bad debt provisions of EUR 1.6 million (H1 2008: EUR thou. 41) and the recognition of expected losses of EUR 5.2 million (H1 2008: nil) on seismic services as well as by the Rouble devaluation. The benefits of the Company´s cost cutting measures contributed, however, to an improvement of the EBITDA margin which increased to 19.1% (H1 2008: 17.7%).
Due to higher depreciation rates which are due to the massive capacity addi-tions made in 2008, C.A.T. oil´s earnings before interest and corporate tax (EBIT) fell by 35.4% YoY to EUR 8.9 million (H1 2008: EUR 13.8 million). EBIT margin was at 7.6% (H1 2008: 9.9%).
The net financial result was impacted by unrealized and realized foreign cur-rency translation losses on the euro-denominated inter-company loans and a rise in net interest expenses and amounted to EUR 3.4 million (H1 2008: EUR -0.8 million). On a quarterly basis, the Company´s net financial result increased to EUR 0.1 million (Q2 2008: EUR -0.3 million).
On a six-month-basis, the pre-tax profit decreased by 57.6% YoY to EUR 5.5 million (H1 2008: EUR 13.0 million) as a result of lower operating income and foreign currency losses. The Group´s net income went down 59.5% YoY to EUR 2.7 million (H1 2008: EUR 6.8 million). Earnings per share amounted to EUR 0.056 for the first half of 2009 (H1 2008: EUR 0.139).
Strong financial position and extremely healthy equity ratio of 75.6%
In the first six months of Fiscal Year 2009, C.A.T. oil generated a strong cash flow from operating activities of EUR 22.3 million (H1 2008: EUR 15.4 million), which represents an increase of 44.9% YoY. Apart from one sidetracking rig, which will be delivered to the Company´s sites in September, C.A.T. oil´s CAPEX program for 2009 foresees investments in material procurement and maintenance only. Cash flow from investing activities was EUR -6.2 million (H1 2008: EUR -19.5 million). As a result, C.A.T. oil generated a positive free cash flow of EUR 16.1 million (H1 2008: negative free cash flow of EUR 4.1 million). Cash flow from financing activities amounted to EUR -15.8 million (H1 2008: EUR -2.6 million), primarily reflecting a deliberate early repayment of long term debt. Cash and cash equivalents rose to EUR 14.7 million on 30 June 2009 (31 December 2008: EUR 14.4 million).
In the reporting period C.A.T. oil reduced its long term interest bearing liabilities by 52.9% to EUR 14.1 million at 30 June 2009 from EUR 30 million at 31 December 2008. Thanks to the Company´s conservative financial policy, C.A.T. oil continues to operate on the basis of a strong equity ratio which amounted to 75.6% on 30 June 2009 (31 December 2008: 73.4%).
Focus on profitability, active customer management and excellent service
In the second half of 2009 C.A.T. oil will continue to concentrate on increasing its profitability and on expanding its market share. The Company will consequently follow its strict cost management and personnel program which foresees the reduction of headcount mainly by fluctuation to a level of approximately 3,000 people. In H1 2009, C.A.T. oil´s weighted average number of employees was 3,104 people (H1 2008: 3,618), the vast majority being based in Russia and Kazakhstan. Moreover, C.A.T. oil will concentrate on maintaining its long lasting customer relationships through active customer management, flexible adjustments to customers´ needs and by being a reliable and efficient business partner. An additional order C.A.T. oil received in the second quarter by LUKOIL, increasing the Company´s 2009 order book volume to EUR 198 million (con-servatively assuming a Rouble/Euro exchange rate of 48), proves that this service approach pays off.
Manfred Kastner, CEO of C.A.T. oil, said: "Despite the difficult trading envi-ronment, C.A.T. oil has moved well through the first half of 2009. We have made very good progress in improving our cost base while at the same remaining dedicated to our customers. By the middle of 2009 we had about 55% of our 2009 order book executed. Although we expect the second half of 2009 to remain challenging, we are convinced that C.A.T. oil will be able to benefit from its strong position in its core markets and capture additional orders through new tenders and the extension of the existing contracts. We will consequently follow our high quality approach while at the same time continuing our conservative financial policy thereby preparing C.A.T. oil for the times once markets fundamentally recover."
www.catoilag.com
Press contact: Financial Dynamics GmbH
Carolin Amann Lucie Kimmich Tel.: +49 (0)69 92037-132 Tel.: +49 (0)69 92037-183 Email: carolin.amann@fd.com Email: lucie.kimmich@fd.com
About C.A.T. oil AG:
C.A.T. oil AG is one of the leading providers of oil and gas field services in Russia and Kazakhstan and is listed at the Frankfurt Stock Exchange (SDAX). C.A.T. oil offers a wide spectrum of services to increase the lifecycle of an oil field or to make abandoned oil fields accessible. The Company´s growth is driven by three significant factors: Existing oil fields need to be stimulated due to shrinking oil and gas resources in order to optimize capacities. Simultaneously, idle wells are reactivated or made accessible through new methods in order to deploy wells to their maximum. Additionally C.A.T. oil offers seismic services which help to identify new oil and gas sources.
Since its foundation in 1991 in Celle, Germany, C.A.T. oil has built up a leading hy-draulic fracturing services business with a current market share of almost 30% in Rus-sia and Kazakhstan. Following its IPO in 2006 the company has invested more than EUR 200 million in additional services and capacities: sidetrack drilling has become the Company´s second core business with a market share of approx. 18% in Russia. Apart from the services mentioned above, C.A.T.oil´s diversified service portfolio includes coiled tubing, formation evaluation services, well work-over, cementing and seismic services. Due to the recent expansion investments C.A.T. oil´s fleets and rigs are state-of-the-art and therefore allow for time-efficient and effective deployment. C.A.T. oil´s customer base includes the leading Russian and Kazakh oil and gas pro-ducers amongst them Gazprom, KazMunaiGaz, LUKOIL, Rosneft and TNK-BP. With all of them C.A.T. oil has a long-standing relationship and has been a reliable service provider since its market entrance in the early nineties.
The Company has its headquarters in Vienna and employed an average of 3,104 people in the first half of 2009, most of whom are based in Russia and Kazakhstan. The Company´s order book for 2009 amounted to EUR 198 million in May 2009.
Key financial figures for the first half of 2009
[in million EUR] H1 2009 H1 2008 Change in % Revenues 117.5 139.4 -15.7 Cost of sales 94.2 113.1 -16.7 Gross profit 23.3 26.3 -11.4 EBITDA 22.4 24.6 -9.0 EBITDA margin (in%) 19.1 17.7 EBIT 8.9 13.8 -35.4 EBIT margin (in%) 7.6 9.9 Net result for period 2.7 6.8 -59.5 Earnings per share (in EUR) 0.056 0.139 -59.7 Equity Ratio (in %) (1) 75.6 73.4
Cash flow from operating activities 22.3 15.4 44.9 Cash flow from investing activities -6.2 -19.5 -68.2 Cash flow from financing activities -15.8 -2.6 -507.7 Cash and cash equivalents (1) 14.7 14.4 2.6
Total job count 1,525 1,488 2.5 Per-job revenue (in thou. EUR) 77.1 93.7 -17.7 Employees 3,104 3,618 -14.2
(1) As of 30 June 2009 and 31 December 2009 respectively
Key financial figures for Q2 2009
[in million EUR] Q2 2009 Q2 2008 Change in % Revenues 63.8 73.5 -13.2 Cost of sales 46.6 55.8 -16.5 Gross profit 17.1 17.7 -3.0 EBITDA 14.3 17.2 -16.9 EBITDA margin (in%) 22.5 23.5 EBIT 7.6 11.6 -34.1 EBIT margin (in%) 12.0 15.8 Net result for period 3.7 6.3 -42.3 Earnings per share (in EUR) 0.075 0.130 -42.3
Cash flow from operating activities 8.4 7.7 9.1 Cash flow from investing activities -3.0 -10.8 -71.9 Cash flow from financing activities -6.7 -3.3 -101.7
Total job count 858 759 13.0 Per-job revenue (in thou. EUR) 74.3 96.8 -23.2
end of announcement euro adhoc
Further inquiry note:
Lucie Kimmich
Tel.: +49 (69) 920 37-183
E-Mail: lucie.kimmich@fd.com
Branche: Oil & Gas - Upstream activities
ISIN: AT0000A00Y78
WKN: A0IKWU
Index: SDAX, Classic All Share, Prime All Share
Börsen: Frankfurt / regulated dealing/prime standard