Forbes Energy Services Ltd. (NASDAQ: FES) and (TSX: FRB) today announced preliminary unaudited performance data for the three months ended Dec. 31, 2011. The company intends to report 2011 fourth quarter and full year financial results after the close of market on Friday, March 30, 2012. Forbes management will host a teleconference to discuss results at 10 a.m. CDT on Monday, April 2, 2012. Call details will be forthcoming.
Preliminary fourth quarter financial data for Forbes’ U.S. operations are highlighted below. U.S. operations refer to continuing operations, which represent the company’s financial results excluding its discontinued Mexico operations that were sold in January 2012.
For the three months ended Dec. 31, 2011:
- Revenues from U.S. operations are expected to range between $120 million and $126 million;
- Gross margin from U.S. operations is expected to range between $33 million and $36 million;
- Adjusted EBITDA(1) from U.S. operations is expected to range between $28 million and $31 million;
- The U.S. well servicing segment revenues are expected to range between $49 million and $52 million and gross margin is expected to range between $12 million and $13 million;
- The company’s U.S. well servicing fleet had 159 rigs;
- The U.S. fluid logistics and other segment revenues are expected to range between $71 million and $74 million and gross margin is expected to range between $21 million and $23 million;
- The company’s U.S. fluid logistics fleet had 496 heavy-duty trucks and 1,879 frac tanks.
(1)Adjusted EBITDA, a non-GAAP financial measure, is defined by the company as net income before interest, taxes, depreciation, amortization, gain or loss on early extinguishment of debt, non-cash impairments and non-cash stock-based compensation. For a reconciliation of adjusted EBITDA to net income, its most directly comparable GAAP financial measure, for the three months ended Dec. 31, 2011, please see the following preliminary expected ranges:
|(unaudited – in millions)||From||To|
|Depreciation and amortization||10.5||11.5|
|Income tax expense||8.0||9.0|
|Discontinued operations (Mexico)||(3.5||)||(4.5||)|
|Adjusted EBITDA from continuing operations||$||28.0||$||31.0|
About the Company
Forbes Energy Services Ltd. is an independent oilfield services contractor that provides a broad range of drilling-related and production-related services to oil and natural gas companies, primarily onshore in Texas, Mississippi and Pennsylvania.
Forward-Looking Statements and Regulation G Reconciliation
This press release contains “forward-looking statements,” as contemplated by the Private Securities Litigation Reform Act of 1995, in which the Company discusses factors it believes may affect its performance in the future. The accuracy of the Company’s assumptions, expectations, beliefs and projections depend on events or conditions that change over time and are thus susceptible to change based on actual experience, new developments and known and unknown risks. The Company gives no assurance that the forward-looking statements will prove to be correct and does not undertake any duty to update them. The Company’s actual future results might differ from the forward-looking statements made in this press release for a variety of reasons, which include: supply and demand for oilfield services and the level of oil and natural gas prices; the continued uncertainty in the global financial markets and its effect on domestic spending in the oil and natural gas industry; the Company's ability to maintain or improve pricing on its core services; the potential for excess capacity in the industry; and competition. Additional factors that you should consider are set forth in detail in the Risk Factors section of the Company’s Annual Report on Form 10-K for the year ended Dec. 31, 2010 (the "Form 10-K"), which was previously filed, as well as other filings the Company has made with the Securities and Exchange Commission. Should one or more of the foregoing risks or uncertainties materialize, or should the Company’s underlying assumptions prove incorrect, the Company’s actual results may vary materially from those anticipated in its forward-looking statements, and the Company’s business, financial condition and results of operations could be materially and adversely affected.
This press release also contains references to the non-GAAP financial measure of adjusted EBITDA. For a reconciliation of adjusted EBITDA to net income, please see footnote (1) above. Management’s opinion regarding the usefulness of adjusted EBITDA to investors and a description of the ways in which management uses such measures can be found on the “Investor Relations” page of the Company’s website.
L. Melvin Cooper, 361-664-0549
SVP & CFO
Michael Russell, 512-750-4925
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