Gibson Energy Inc. Reports 2012 First Quarter Financial Results

May 08, 2012

All financial figures are in Canadian dollars

CALGARY, May 8, 2012 /CNW/ - Gibson Energy Inc. ("Gibson" or the "Company"), TSX: GEI, today reported strong results for the first quarter 2012 supported by large increases in segment profit1 across three operating segments.

Adjusted EBITDA2 for the three months ended March 31, 2012 increased by 26% to $71.8 million compared to $56.9 million in the three months ended March 31, 2011.  Pro Forma Adjusted EBITDA3 for the twelve months ended March 31, 2012 was $249.8 million.

Cash provided by operations for the three months ended March 31, 2012 was $64.6 million compared to $63.6 million in the three months ended March 31, 2011.

"Rising crude oil prices and wider differentials in the first quarter, have driven midstream activity to higher levels in both Canada and the United States," said Stewart Hanlon, Gibson's President and Chief Executive Officer.  "The opportunity for the Company to deliver integrated midstream solutions in this environment continues to grow and expand."

For the three months ended March 31, 2012, segment profit increased by 18% to $78.4 million compared to $66.5 million in 2011 driven by significant increases in the Company's Terminal and Pipelines, Truck Transportation and Marketing segments.

All of Gibson's operating segments experienced volume increases in the first quarter of 2012 versus the same period in 2011.  New tanks and pipeline connections at the Hardisty and Edmonton Terminals, increased trucking activity in the United States, capital investments in new rolling stock and higher demand for roofing flux were the primary factors driving the volume increases.

Other Highlights for the First Quarter ended March 31, 2012:

  • Capital expenditures were $42.0 million of which $33.0 million related to internal growth projects. The internal growth project expenditures are primarily related to the construction of new large crude oil tanks and pipeline connections, growth in the custom treating and terminals business and the expansion of the Truck Transportation and Canwest Propane fleets;
  • On March 27, the Company completed a secondary offering of common shares of the Company held by R/C Guitar Coƶperatief U.A. ("Co-op"), a Dutch cooperative owned by investment funds affiliated with Riverstone Holdings LLC, pursuant to which Co-op sold 28,107,782 common shares at a price of $20.70 per common share for total gross proceeds to Co-op of $581.8 million. As a result, Co-op no longer owns any common shares of the Company; and
  • The Company declared a dividend that was paid on April 17, 2012 of $0.25 per common share for total dividends of $24.7 million. The dividend reflects a 4.2% increase from the prior quarterly rate.


(1) Segment profit is defined as revenue minus (i) cost of sales; and (ii) operating costs. It excludes depreciation, amortization, impairment charges, stock based compensation and corporate expenses.
(2) Adjusted EBITDA is defined as consolidated net income (loss) before interest expense, income taxes, depreciation, amortization, other non-cash expenses and charges deducted in determining consolidated net income (loss), including movement in the unrealized gains and losses on the Company's financial instruments, stock based compensation expense, impairment of goodwill and intangible assets, and non-cash inventory write-downs. It also takes into account the impact of foreign exchange movements in the Company's U.S. dollar denominated long-term debt, management fees, debt extinguishment costs and other adjustments that are considered non-recurring in nature.
(3) Pro Forma Adjusted EBITDA differs from Adjusted EBITDA in that it also includes the pro forma effect of acquisitions that took place in the twelve month period as if the acquisitions took place at the beginning of the twelve month period in which such acquisitions occurred.

MD&A, Financial Statements & Notes

The Management's Discussion and Analysis and the Condensed Consolidated Financial Statements provide a detailed explanation of Gibson's operating results for the three months ended March 31, 2012, as compared to the three months ended March 31, 2011.  These documents are available at www.gibsons.com and at www.sedar.com.

2012 First Quarter Results Conference Call

A conference call to discuss Gibson's first quarter results will be held at 7:00 a.m. MT (9:00 a.m. ET) on Wednesday, May 9, 2012 for interested investors, analysts and media representatives.

The conference call dial-in numbers are:

  • 1-866-696-5910 from Canada and the US
  • 416-340-2217 from Toronto and International
  • Participant Pass Code:  7015666

Shortly after the call, an audio archive will be posted on the Investor Relations and Media section at http://www.gibsons.com.

The call will also be recorded for playback 60 minutes after the meeting end time, until September 7, 2012, using the following dial in process:

  • 905-694-9451 / 800-408-3053
  • Pass code:  8654994

About Gibson

Gibson is one of the largest independent midstream energy companies in Canada and a major participant in the crude oil transportation business in the United States, and is engaged in the movement, storage, blending, processing, marketing and distribution of crude oil, condensate, natural gas liquids, and refined products.  Gibson transports hydrocarbons by utilizing its integrated network of terminals, pipelines, storage tanks, and truck fleet located throughout western Canada and the United States.  Gibson is also involved in the processing, blending and marketing of hydrocarbons, provision of water disposal and oilfield waste management services and is the second largest retail propane distribution company in Canada.

Forward-Looking Statements

Certain statements contained in this news release constitute forward-looking information and statements (collectively, "forward-looking statements"). These statements relate to future events or the Company's future performance. All statements other than statements of historical fact are forward-looking statements. The use of any of the words ''anticipate'', ''plan'', ''contemplate'', ''continue'', ''estimate'', ''expect'', ''intend'', ''propose'', ''might'', ''may'', ''will'', ''shall'', ''project'', ''should'', ''could'', ''would'', ''believe'', ''predict'', ''forecast'', ''pursue'', ''potential'' and ''capable'' and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this news release should not be unduly relied upon. These statements speak only as of the date of this news release. In addition, this news release may contain forward-looking statements and forward-looking information attributed to third party industry sources. The Company does not undertake any obligations to publicly update or revise any forward looking statements except as required by securities law. Actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous risks and uncertainties including, but not limited to, the risks and uncertainties described in "Forward-Looking Statements" and "Risk Factors" included in the Company's Annual Information Form dated March 6, 2012 as filed on SEDAR and available on the Gibson website at www.gibsons.com.

This news release refers to certain financial measures that are not determined in accordance with International Financial Reporting Standards ("IFRS"). Adjusted EBITDA and Pro Forma Adjusted EBITDA are not measures recognized under IFRS and do not have standardized meanings prescribed by IFRS. Management considers these to be important supplemental measures of the Company's performance and believes these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in its industries with similar capital structures. See ''Summary of Quarterly Results" in the Company's MD&A for a reconciliation of EBITDA to net income (loss), the IFRS measure most directly comparable to EBITDA, and for a reconciliation of Adjusted EBITDA and Pro Forma Adjusted EBITDA to EBITDA. Investors are encouraged to evaluate each adjustment and the reasons the Company considers it appropriate for supplemental analysis. Investors are cautioned, however, that these measures should not be construed as an alternative to net income (loss) determined in accordance with IFRS as an indication of the Company's performance.

First Quarter - Selected Financial Highlights
         
    Three months ended March 31
    2012   2011
    (in thousands)
         
Segment Profit:        
Terminals and Pipelines    $23,053   $16,736
Truck Transportation    19,362   16,236
Propane and NGL Marketing and Distribution    15,334   17,548
Processing and Wellsite Fluids    10,729   11,128
Marketing    9,956   4,826
Total Segment Profit    $78,434   $66,474
         
Statement of Cash Flows Data:        
Cash flows provided by (used in):        
Operating Activities    $64,641   $63,571
Investing Activities    (34,655)   36,106
Financing Activities    (20,203)   (54,326)
         
Other Financial Data:        
Capital Expenditures:        
Internal Growth Projects    $33,050   $14,959
Upgrade and Replacement Capital    8,979   8,468
         
Adjusted EBITDA    $71,789   $56,939
    Twelve months
ended
March 31, 2012
   
Pro Forma Adjusted EBITDA    $249,753    
         

 

For further information:

Ken Hall
Vice President Investor Relations and Communications
(403) 781-2899
ken.hall@gibsons.com