CALGARY, AB, May 3, 2022 /CNW/ - Calfrac Well Services Ltd.
("Calfrac" or "the Company") (TSX: CFW) announces its
financial and operating results for the three months ended
March 31, 2022.
HIGHLIGHTS - CONTINUING
OPERATIONS
Three Months Ended
March 31,
|
2022
|
2021
|
Change
|
(C$000s, except per
share amounts)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
Revised
|
|
Revenue
|
294,524
|
213,954
|
38
|
Operating
income(1)
|
21,029
|
11,464
|
83
|
Per share –
basic
|
0.55
|
0.31
|
77
|
Per share –
diluted
|
0.25
|
0.14
|
79
|
Adjusted
EBITDA(1)
|
20,831
|
10,821
|
93
|
Per share –
basic
|
0.55
|
0.29
|
90
|
Per share –
diluted
|
0.25
|
0.13
|
92
|
Net loss from
continuing operations
|
(18,030)
|
(23,029)
|
(22)
|
Per share – basic and
diluted
|
(0.47)
|
(0.62)
|
(24)
|
Weighted average common
shares outstanding (000s)
|
|
|
|
Basic
|
38,066
|
37,422
|
2
|
Diluted
|
84,675
|
83,814
|
1
|
As at
|
March
31
|
December 31
|
Change
|
|
2022
|
2021
|
|
(C$000s)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
Revised
|
|
Working capital, end of
period
|
130,246
|
121,934
|
7
|
Total assets, end of
period
|
862,519
|
822,368
|
5
|
Long-term debt, end of
period
|
397,060
|
388,479
|
2
|
Total equity, end of
period
|
302,195
|
328,840
|
(8)
|
|
(1) Refer to "Non-GAAP Measures"
on pages 10 and 11 for further information.
|
|
(2) During the first quarter of 2022,
management committed to a plan to sell its Russian division,
resulting in the associated assets and liabilities being presented
as held for sale. Results from operations held for sale have not
been included in the table above.
|
PRESIDENT'S MESSAGE
Calfrac's President and Chief Operating Officer, Lindsay Link commented: "Calfrac finished the
first quarter with significant momentum driven by high levels of
utilization and increases in pricing in North America as we worked primarily with our
longer term customers in a tightening market for services. With a
positive commodity price outlook for the oil and gas industry, the
Company expects this positive momentum to continue throughout the
remainder of 2022, which should result in a significant improvement
in year-over-year operational and financial performance. I would
like to thank our employees for their commitment and dedication,
which has resulted in Calfrac continuing to deliver safe, efficient
and effective service and allowing it to maintain its brand promise
and license to operate."
FIRST QUARTER 2022
OVERVIEW
In the first quarter of 2022, the Company:
- generated revenue of $294.5
million, an increase of 38 percent from the first quarter in
2021 resulting primarily from improved pricing in North America and higher activity in
the United States and Argentina;
- reported adjusted EBITDA of $20.8
million versus $10.8 million
in the first quarter of 2021;
- committed to a plan to sell its Russian division, resulting in
such associated assets and liabilities being presented as
held for sale in the interim consolidated financial statements;
- reported a net loss from continuing operations of $18.0 million or $0.47 per share diluted compared to a net loss of
$23.0 million or $0.62 per share diluted during the first quarter
in 2021;
- executed a secured bridge loan with G2S2 Capital Inc. (the G2S2
Loan), a company controlled by George
Armoyan, in order to fund its short-term working capital
requirements. As of March 31, 2022,
the Company had drawn $15.0 million
on the loan and can request further draws up to an additional
$10.0 million, for maximum proceeds
of $25.0 million, at an interest rate
of 8.0 percent. Subsequent to the end of the quarter, the maturity
date of this loan was extended to June 28,
2022;
- reported period-end working capital of $130.2 million versus $121.9 million at December
31, 2021;
- incurred capital expenditures of $12.1
million primarily to support the Company's United States fracturing operations; and
- negotiated additional waivers and amendments to its revolving
credit facilities in order to fund expected future working capital
requirements in North
America.
CONSOLIDATED HIGHLIGHTS -
CONTINUING OPERATIONS
Three Months
Ended
|
March
31,
|
December 31,
|
Change
|
|
2022
|
2021
|
|
(C$000s, except
operational information)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
Revised
|
|
Revenue
|
294,524
|
229,661
|
28
|
Expenses
|
|
|
|
Operating
|
260,871
|
209,410
|
25
|
SG&A
|
12,624
|
12,786
|
(1)
|
|
273,495
|
222,196
|
23
|
Operating
income(1)
|
21,029
|
7,465
|
182
|
Operating income
(%)
|
7.1
|
3.3
|
115
|
Adjusted
EBITDA(1)
|
20,831
|
7,961
|
162
|
Adjusted EBITDA
(%)
|
7.1
|
3.5
|
103
|
Fracturing revenue per
job ($)
|
31,460
|
32,971
|
(5)
|
Number of fracturing
jobs
|
8,222
|
6,111
|
35
|
Active pumping
horsepower, end of period (000s)
|
936
|
943
|
(1)
|
Idle pumping
horsepower, end of period (000s)
|
346
|
337
|
3
|
Total pumping
horsepower, end of period (000s)
|
1,282
|
1,280
|
—
|
Coiled tubing revenue
per job ($)
|
25,755
|
17,434
|
48
|
Number of coiled tubing
jobs
|
750
|
730
|
3
|
Active coiled tubing
units, end of period (#)
|
13
|
13
|
—
|
Idle coiled tubing
units, end of period (#)
|
6
|
7
|
(14)
|
Total coiled tubing
units, end of period (#)
|
19
|
20
|
(5)
|
Cementing revenue per
job ($)
|
81,047
|
83,848
|
(3)
|
Number of cementing
jobs
|
122
|
123
|
(1)
|
Active cementing units,
end of period (#)
|
10
|
10
|
—
|
Idle cementing units,
end of period (#)
|
4
|
5
|
(20)
|
Total cementing units,
end of period (#)
|
14
|
15
|
(7)
|
|
(1) Refer
to "Non-GAAP Measures" on pages 10 and 11 for further
information.
|
First-quarter revenue in 2022 of $294.5
million represented an increase of 28 percent from the
fourth quarter of 2021, primarily due to higher fracturing activity
in Canada and Argentina combined with improved pricing in
the United States. Revenue per
fracturing job was 5 percent lower than the fourth quarter of 2021
due to the completion of smaller jobs in Argentina, offset partially by pricing
increases in the United States and
Canada.
In Canada, revenue increased by
60 percent from the fourth quarter of 2021 to $107.6 million in the first quarter of 2022 as
the Company increased its marketed asset base to four large
fracturing fleets and operated a fifth coiled tubing unit in the
first quarter in 2022. Operating income as a percentage of revenue
was 13 percent, compared to 7 percent in the fourth quarter of
2021.
In the United States, revenue
in the first quarter of 2022 was $132.3
million, a 20 percent increase from the fourth quarter of
2021. The first quarter began slowly with some scheduling gaps in
January. However, the Company achieved more consistent activity as
the quarter progressed. As a result, the Company began the quarter
with a total of four active fleets in the
United States and exited the quarter with eight of its nine
active fleets fully utilized across its three operating districts.
The Company continued to implement pricing increases during the
first quarter in order to cover higher input costs across most
operating cost categories. Operating income was $7.9 million in the first quarter compared to
$2.1 million in the fourth quarter of
2021.
In Argentina, revenue increased
by 5 percent from the fourth quarter in 2021 to $54.6 million in the first quarter of 2022. The
ongoing improvement in operating conditions resulted in a
sequential increase in overall activity particularly for the
Company's fracturing and coiled tubing operations. Operating income
decreased from $6.9 million in the
fourth quarter of 2021 to $5.5
million in the first quarter of 2022 due to inflationary
salary increases that are paid in pesos that were not immediately
offset by the devaluation in the official peso exchange
rate.
Adjusted EBITDA from continuing operations of $20.8 million for the first quarter of 2022
increased from $8.0 million in the
fourth quarter of 2021, primarily due to better utilization and
pricing in North America.
BUSINESS UPDATE AND
OUTLOOK
As crude oil and natural gas prices remain at multi-year highs,
demand for Calfrac's services has improved as customers prioritize
quality execution in selecting service providers. In North America, the Company built momentum
throughout the first quarter, and looks to improve upon its strong
finish through the remainder of 2022. Calfrac's diverse operational
footprint positions it to take advantage of the world's increased
reliance on North American onshore oil and gas production. The
Company is excited to leverage its culture and people to seize upon
this current cycle of improving market fundamentals and increase
financial returns by providing superior services to its
customers.
CANADA
Calfrac's Canadian division generated momentum through the
quarter and ended the first quarter operating at full capacity for
its active equipment. While seasonal break-up is affecting April's
activity, the Company expects utilization for its four large
fracturing fleets and four coiled tubing units to increase towards
the end of the quarter, setting up for a strong second half in
2022. The Company expects its diverse customer base will allow it
to take advantage of the undersupplied services market and increase
net pricing to the benefit of Calfrac's shareholders. Even though
costs are inflating at a more subdued rate than experienced in the
first quarter in 2022, the Company continues to pass-through input
cost increases to its customers. Although the pressure pumping
sector has achieved recent net price improvement, Calfrac believes
that industry pricing is still below the necessary level for
sustainable capital investment.
UNITED
STATES
The Company's United States
operations leveraged improving activity and pricing to exit the
first quarter with its strongest fleet profitability in recent
years. The first quarter's momentum is expected to continue for the
remainder of the year as Calfrac showcases its reputation as a
desirable service provider through its nine sold out fracturing
fleets, which are anticipated to drive robust year-over-year
increases in operating cash flow. The Company is well-positioned to
capitalize on what is anticipated to be a multi-year activity
expansion through its operational excellence, and a customer base
that values a viable services sector. As the pressure pumping
market in the United States
continues to tighten, Calfrac will carefully evaluate any
opportunities to increase its operating scale to ensure that the
anticipated returns will exceed its internal financial
thresholds.
ARGENTINA
Calfrac's operations in Argentina have experienced strong equipment
utilization in the Vaca Muerta shale play and southern Argentina. The Company has recently renewed a
contract with an existing customer, beginning in July 2022, for two years for a dedicated
fracturing fleet and coiled tubing unit that incorporates improved
market pricing. The Company expects its positive momentum to
deliver an increase in financial performance as the year progresses
in 2022.
CORPORATE
Calfrac remains focused on optimizing its operating efficiencies
as well as prudent capital allocation in order to drive an increase
in operating cash flow which will be dedicated to debt repayment.
The Company will consider additional fleet reactivations or growth
investments only if the financial returns exceed its internal
financial benchmarks and properly account for macroeconomic,
industry and operation-specific risk factors.
LIQUIDITY AND CAPITAL
RESOURCES
|
Three Months Ended
Mar. 31,
|
|
2022
|
2021
|
(C$000s)
|
($)
|
($)
|
(unaudited)
|
|
|
Cash provided by (used
in):
|
|
|
Operating
activities
|
15,753
|
(19,862)
|
Financing
activities
|
22,052
|
15,981
|
Investing
activities
|
(15,497)
|
(10,506)
|
Effect of exchange rate
changes on cash and cash equivalents
|
(7,020)
|
(1,478)
|
Increase (decrease) in
cash and cash equivalents
|
15,288
|
(15,865)
|
OPERATING ACTIVITIES
The Company's consolidated cash provided by operating activities
for the three months ended March 31, 2022 was $15.8 million versus cash used of $19.9 million in the comparable period in 2021.
The increase in cash from operations was primarily due to an inflow
of cash from working capital during the period. In the first
quarter in 2022, $9.2 million of cash
was provided by reductions in working capital versus requiring
$20.8 million of cash in the same
period in 2021. At March 31, 2022, Calfrac's working capital
from continuing operations was $130.2
million compared to $121.9
million at December 31,
2021.
FINANCING ACTIVITIES
Net cash provided by financing activities for the three months
ended March 31, 2022 was $22.1 million compared to net cash provided of
$16.0 million in the same period in
2021. During the quarter, the Company borrowed $8.4 million on a net basis under its credit
facilities, received $15.0 million of
bridge loan financing, paid lease principal payments of
$2.1 million and received proceeds of
$0.7 million from the exercise of a
portion of the Company's outstanding warrants.
On June 30, 2021, the Company
amended its revolving credit facility agreement, a copy of which is
available on SEDAR, to reduce its total facility capacity from
$290.0 million to $225.0 million and extended the maturity date to
July 1, 2023. On November 25, 2021, the Company further amended
its revolving credit facility agreement to increase its total
facility capacity to $250.0
million.
During the first quarter of 2022, the Company negotiated
additional waivers and amendments to its revolving credit
facilities in order to fund expected future working capital
requirements in North America. The
waivers and amendments included the following:
- The Company's Funded Debt to Adjusted EBITDA covenant was
increased to 3.75x for the quarter ended March 31, 2022;
- The minimum $15.0 million
liquidity requirement was temporarily waived through March 15, 2022 and reinstated through the term of
an extended Covenant Relief Period. The extended Covenant Relief
Period terminates on June 30, 2022 to
the extent Calfrac has provided a compliance certificate to its
lenders certifying compliance with all applicable financial
covenants at such quarter end;
- G2S2 Capital Inc. ("G2S2") was added as a lender to permit the
incurrence of a secured bridge loan from G2S2 under the credit
agreement, with such debt being excluded from the definitions of
Funded Debt, Total Debt and Current Liabilities for the purposes of
financial covenant calculations; and
- The eligible portion of the net book value of PP&E for the
purposes of the borrowing base calculation was increased from 25
percent to 35 percent, subject to a maximum contribution of
$150.0 million.
Additionally, the Company executed a secured bridge loan with
G2S2, a company controlled by George
Armoyan, in order to fund its short-term working capital
requirements. As of March 31, 2022,
the Company had drawn $15.0 million
on the loan and can request further draws up to an additional
$10.0 million, for maximum proceeds
of $25.0 million, at an interest rate
of 8.00 percent. Subsequent to the end of the quarter, the maturity
date of this loan was extended to June 28,
2022. The G2S2 Loan is secured by the existing security
interests securing the obligations under the credit agreement,
provided that in the event of an enforcement of such security
interests, G2S2's right to any realization proceeds is subordinate
to the prior repayment in full of all of the other lenders. G2S2
has no voting rights as a lender under the credit agreement for any
purpose.
The Company's revolving credit facilities consist of an
operating facility of $45.0 million
and a syndicated facility of $205.0
million. The Company's credit facilities mature on
July 1, 2023, and can be extended by
one or more years at the Company's request and lenders'
acceptance. The Company may also prepay principal without
penalty. The interest rates are based on the parameters of certain
bank covenants. For prime-based loans and U.S. base-rate loans, the
rate ranges from prime or U.S. base rate plus 1.00 percent to prime
plus 3.50 percent. For LIBOR-based loans and bankers'
acceptance-based loans, the margin thereon ranges from 2.00 percent
to 4.50 percent above the respective base rates. The Company incurs
interest at the high end of the ranges outlined above during the
Covenant Relief Period or if its net Total Debt to Adjusted EBITDA
ratio is above 4.00:1.00. Additionally, in the event that the
Company's net Total Debt to Adjusted EBITDA ratio is above
5.00:1.00 and also during the Covenant Relief Period, certain
restrictions apply including the following, among others: (a)
acquisitions are subject to consent of the lenders; (b)
distributions are restricted other than those relating to the
Company's equity compensation plans; (c) no increase in the rate of
dividends are permitted; and (d) additional permitted debt is
restricted to $5.0 million, subject to certain exceptions. As
at March 31, 2022, the Company's net Total Debt to Adjusted
EBITDA ratio exceeded the 5.00:1.00 threshold and the Company was
also subject to the Covenant Relief Period restrictions.
At March 31, 2022, the Company had used $0.9 million of its credit facilities for letters
of credit and had $200.0 million of
borrowings under its credit facilities. As described above, the
Company's credit facilities are subject to a monthly borrowing
base, which at March 31, 2022 was
$243.8 million. Under the terms of
the Company's amended credit facility agreement, Calfrac must
maintain a minimum liquidity amount of $15.0
million during the Covenant Relief Period.
The Company's credit facilities contain certain financial
covenants. As per the most recently amended credit facility
agreement, the Company's Funded Debt to Adjusted EBITDA covenant is
3.75x for the quarter ended March 31,
2022 and 3.00x for each quarter end thereafter. As shown in
the table below, the Company was in compliance with its financial
covenants associated with its credit facilities as at
March 31, 2022.
|
Covenant
|
Actual
|
As at March
31,
|
2022
|
2022
|
Working capital ratio
not to fall below
|
1.15x
|
2.16x
|
Funded Debt to Adjusted
EBITDA not to exceed(1)(2)
|
3.75x
|
3.26x
|
Funded Debt to
Capitalization not to exceed(1)(3)
|
0.30x
|
0.28x
|
|
(1)
Funded Debt is defined as Total Debt excluding all outstanding
10.875% second lien senior secured notes due 2026 ("Second Lien
Notes"), 10.00% convertible 1.5 lien senior secured PIK notes due
2023 ("1.5 Lien Notes"), the G2S2 Loan and lease obligations. Total
Debt includes bank loans and long-term debt (before unamortized
debt issuance costs and debt discount) plus outstanding letters of
credit. For the purposes of the Total Debt to Adjusted EBITDA
ratio, the Funded Debt to Capitalization Ratio and the Funded Debt
to Adjusted EBITDA ratio, the amount of Total Debt or Funded Debt,
as applicable, is reduced by the amount of cash on hand with
lenders (excluding any cash held in a segregated account for a
specified purpose, including a potential equity
cure).
|
|
(2)
Adjusted EBITDA is defined as net income or loss for the period
adjusted for interest, taxes, depreciation and amortization,
non-cash stock-based compensation, and gains and losses that are
extraordinary or non-recurring.
|
|
(3) Capitalization is Total Debt
plus equity.
|
INVESTING ACTIVITIES
Calfrac's consolidated net cash used in investing activities was
$15.5 million for the three months
ended March 31, 2022 versus $10.5
million in the comparable period in 2021. Cash outflows
relating to capital expenditures were $16.1
million for the quarter ended March 31, 2022 compared
to $10.9 million in 2021. Calfrac's
Board of Directors have approved a 2022 capital budget of
approximately $97.0 million, which is
comprised primarily of maintenance capital, and is subject to
fluctuations based on operating activity.
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS
The effect of changes in foreign exchange rates on the Company's
cash and cash equivalents during the three months ended
March 31, 2022 was a loss of $7.0
million versus a loss of $1.5
million in the comparable period in 2021. These losses
relate to movements of cash and cash equivalents held by the
Company in a foreign currency during the period.
With its working capital position, available credit facilities,
remaining availability under the G2S2 Loan, access to capital
markets and anticipated funds provided by operations, the Company
expects to have adequate resources to fund its financial
obligations and planned capital expenditures for 2022 and
beyond.
At March 31, 2022, the Company had a cash position of
$11.8 million, which excludes cash
held in Russia.
FINANCIAL OVERVIEW – CONTINUING
OPERATIONS – THREE MONTHS ENDED MARCH 31,
2022 VERSUS 2021
CANADA
Three Months Ended
March 31,
|
2022
|
2021
|
Change
|
(C$000s, except
operational information)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
|
|
Revenue
|
107,634
|
85,583
|
26
|
Expenses
|
|
|
|
Operating
|
91,953
|
68,743
|
34
|
SG&A
|
2,161
|
1,661
|
30
|
|
94,114
|
70,404
|
34
|
Operating
income(1)
|
13,520
|
15,179
|
(11)
|
Operating income
(%)
|
12.6
|
17.7
|
(29)
|
Fracturing revenue per
job ($)
|
20,434
|
16,939
|
21
|
Number of fracturing
jobs
|
4,703
|
4,569
|
3
|
Active pumping
horsepower, end of period (000s)
|
227
|
202
|
12
|
Idle pumping
horsepower, end of period (000s)
|
43
|
73
|
(41)
|
Total pumping
horsepower, end of period (000s)
|
270
|
275
|
(2)
|
Coiled tubing revenue
per job ($)
|
29,412
|
23,062
|
28
|
Number of coiled tubing
jobs
|
357
|
355
|
1
|
Active coiled tubing
units, end of period (#)
|
8
|
7
|
14
|
Idle coiled tubing
units, end of period (#)
|
4
|
6
|
(33)
|
Total coiled tubing
units, end of period (#)
|
12
|
13
|
(8)
|
|
(1) Refer to "Non-GAAP Measures"
on pages 10 and 11 for further information.
|
REVENUE
Revenue from Calfrac's Canadian operations during the first
quarter of 2022 was $107.6 million
compared to $85.6 million in the same
period of 2021 primarily due to higher pricing as a result of
inflationary costs being passed through to the customer. The number
of fracturing jobs increased by 3 percent from the comparable
period in 2021 as the Company's four fracturing fleets were highly
utilized during the quarter. Revenue per fracturing job was 21
percent higher than the comparable quarter primarily due to the
recovery of inflation in its operating costs. The number of coiled
tubing jobs was consistent with the first quarter in 2021. The 28
percent increase in the coiled tubing revenue per job as compared
to the same quarter in 2021 was due to a combination of higher
pricing and a greater proportion of milling work, which are
typically larger jobs than other coiled tubing services.
OPERATING INCOME
Operating income in Canada
during the first quarter of 2022 was $13.5
million compared to $15.2
million in the same period of 2021. The Canadian division's
operating income as a percentage of revenue was 13 percent compared
to 18 percent in the first quarter of 2021 due to significant
inflationary cost pressures during the first quarter that impacted
the majority of the Company's cost categories including fuel, sand,
chemicals, trucking and personnel costs. In addition, the Company
did not receive any benefit from the Canadian Emergency Wage
Subsidy ("CEWS") in the first quarter of 2022 while the comparable
quarter included a benefit of $1.4
million. The Company introduced price increases of
approximately 10 percent during the quarter. However, the impact of
these price increases were mainly realized in the second half of
the quarter. SG&A expenses increased 30 percent year-over-year
primarily due to the reinstatement of salary and benefit rollbacks
and the elimination of the CEWS benefit in 2022.
UNITED
STATES
Three Months Ended
March 31,
|
2022
|
2021
|
Change
|
(C$000s, except
operational and exchange rate information)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
|
|
Revenue
|
132,311
|
92,913
|
42
|
Expenses
|
|
|
|
Operating
|
121,508
|
93,154
|
30
|
SG&A
|
2,908
|
2,771
|
5
|
|
124,416
|
95,925
|
30
|
Operating income
(loss)(1)
|
7,895
|
(3,012)
|
NM
|
Operating income (loss)
(%)
|
6.0
|
(3.2)
|
NM
|
Fracturing revenue per
job ($)
|
44,286
|
26,239
|
69
|
Number of fracturing
jobs
|
2,987
|
3,541
|
(16)
|
Active pumping
horsepower, end of period (000s)
|
570
|
532
|
7
|
Idle pumping
horsepower, end of period (000s)
|
303
|
338
|
(10)
|
Total pumping
horsepower, end of period (000s)
|
873
|
870
|
—
|
Active coiled tubing
units, end of period (#)
|
—
|
—
|
—
|
Idle coiled tubing
units, end of period (#)
|
1
|
1
|
—
|
Total coiled tubing
units, end of period (#)
|
1
|
1
|
—
|
Active cementing units,
end of period (#)
|
—
|
—
|
—
|
Idle cementing units,
end of period (#)
|
1
|
3
|
(67)
|
Total cementing units,
end of period (#)
|
1
|
3
|
(67)
|
US$/C$ average exchange
rate(2)
|
1.2663
|
1.2660
|
—
|
|
(1) Refer to "Non-GAAP Measures"
on pages 10 and 11 for further information.
|
|
(2) Source: Bank of
Canada.
|
REVENUE
Revenue from Calfrac's United
States operations increased to $132.3
million during the first quarter of 2022 from $92.9 million in the comparable quarter of 2021.
The 42 percent increase in revenue can be attributed to a
combination of a 69 percent increase in revenue per job
period-over-period offset partially by a 16 percent decrease in the
number of fracturing jobs completed. The higher revenue per job was
the result of significantly higher gross pricing for its services
as the Company passed through higher input costs to its customers,
combined with the impact of job mix. The overall reduction in job
count was mainly due to the slow commencement of a significant
customer's pumping schedule in North
Dakota to begin the quarter. As a result, the Company began
the quarter with a total of four active fleets in the United States and exited the quarter with
eight of its nine active fleets fully utilized across its three
operating districts. Activity in Colorado increased relative to the comparable
quarter in 2021 while activity was relatively consistent in the
remaining areas where the Company operates.
OPERATING INCOME (LOSS)
The Company's operations in the United
States generated operating income of $7.9 million during the first quarter of 2022
compared to an operating loss of $3.0
million in the same period in 2021. This increase in
operating income was largely driven by better utilization in the
second half of the quarter and improved pricing. As stated,
activity during the quarter started very slowly and supported
utilization for only four of the Company's nine marketed fleets in
January. However, the Company was able to offset the slow start
with high utilization of eight fleets during the second half of the
quarter. The Company also continued to increase pricing in all of
its operating regions in order to offset the significant
inflationary cost pressures experienced across most operating cost
drivers. The average rig count in the
United States increased from approximately 390 rigs in the
first quarter of 2021 to over 600 rigs in the same period in 2022.
In response, the pressure pumping market continued to tighten which
allowed the Company to achieve net pricing improvements in the
range of 10 percent relative to the comparable quarter in 2021.
SG&A expenses increased by 5 percent primarily due to the
reinstatement of previously reduced salaries and benefits during
the quarter.
ARGENTINA
Three Months Ended
March 31,
|
2022
|
2021
|
Change
|
(C$000s, except
operational and exchange rate information)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
|
|
Revenue
|
54,579
|
35,458
|
54
|
Expenses
|
|
|
|
Operating
|
47,066
|
29,730
|
58
|
SG&A
|
2,044
|
1,814
|
13
|
|
49,110
|
31,544
|
56
|
Operating income
(1)
|
5,469
|
3,914
|
40
|
Operating income
(%)
|
10.0
|
11.0
|
(9)
|
Fracturing revenue per
job ($)
|
56,907
|
54,288
|
5
|
Number of fracturing
jobs
|
532
|
403
|
32
|
Active pumping
horsepower, end of period (000s)
|
139
|
123
|
13
|
Idle pumping
horsepower, end of period (000s)
|
—
|
—
|
—
|
Total pumping
horsepower, end of period (000s)
|
139
|
123
|
13
|
Coiled tubing revenue
per job ($)
|
22,433
|
18,781
|
19
|
Number of coiled tubing
jobs
|
393
|
236
|
67
|
Active coiled tubing
units, end of period (#)
|
5
|
5
|
—
|
Idle coiled tubing
units, end of period (#)
|
1
|
1
|
—
|
Total coiled tubing
units, end of period (#)
|
6
|
6
|
—
|
Cementing revenue per
job ($)
|
81,047
|
50,665
|
60
|
Number of cementing
jobs
|
122
|
93
|
31
|
Active cementing units,
end of period (#)
|
10
|
10
|
—
|
Idle cementing units,
end of period (#)
|
2
|
3
|
(33)
|
Total cementing units,
end of period (#)
|
12
|
13
|
(8)
|
US$/C$ average exchange
rate(2)
|
1.2663
|
1.2660
|
—
|
|
(1) Refer to "Non-GAAP Measures"
on pages 10 and 11 for further information.
|
|
(2) Source: Bank of
Canada.
|
REVENUE
Calfrac's Argentinean operations generated revenue of
$54.6 million during the first
quarter of 2022 compared to $35.5
million in the comparable quarter in 2021. Activity in the
first quarter of 2022 improved year-over-year across all service
lines with the vast majority of the improvement occurring in the
Neuquén region. Activity in the Vaca Muerta shale play continued to
increase while activity in southern Argentina remained relatively consistent with
the comparable quarter in 2021. Overall fracturing activity
increased by 32 percent compared to the first quarter in 2021 along
with 5 percent higher revenue per job. Revenue from the Company's
coiled tubing and cementing service lines continued to improve
relative to the comparable period in 2021. The number of coiled
tubing jobs increased by 67 percent as customer activity picked up
in Neuquén and in southern Argentina while revenue per job improved by 19
percent primarily due to job mix. Activity in the Company's
cementing operations increased by 31 percent and revenue per job
increased by 60 percent due to changes in job mix as a greater
number of pre-fracturing projects, which are typically larger job
sizes, were completed in the first quarter of 2022.
OPERATING INCOME
The Company's operations in Argentina generated operating income of
$5.5 million during the first quarter
of 2022 compared to operating income of $3.9
million in the comparable quarter of 2021. Utilization of
the Company's equipment improved across all service lines compared
to the same period in 2021. The Company's operating margins as a
percentage of revenue decreased from 11.0 percent to 10.0 percent
due to inflationary salary increases that are paid in pesos that
were not offset by the devaluation in the official peso exchange
rate. The Company also incurred $0.3
million of severance costs during the first quarter of
2022.
CORPORATE
Three Months Ended
March 31,
|
2022
|
2021
|
Change
|
(C$000s)
|
($)
|
($)
|
(%)
|
(unaudited)
|
|
|
|
Expenses
|
|
|
|
Operating
|
344
|
355
|
(3)
|
SG&A
|
5,511
|
4,262
|
29
|
|
5,855
|
4,617
|
27
|
Operating
loss(1)
|
(5,855)
|
(4,617)
|
27
|
% of Revenue from
Continuing Operations
|
2.0
|
2.2
|
(9)
|
|
(1) Refer to "Non-GAAP Measures"
on pages 10 and 11 for further information.
|
OPERATING LOSS
Corporate expenses for the first quarter of 2022 were
$5.9 million compared to $4.6 million in the first quarter of 2021. The
higher SG&A expense was due to an increase in stock-based
compensation expense of $1.2 million
in the first quarter in 2022 compared to the same period in 2021,
primarily due to the issuance of new equity-based awards under the
omnibus incentive plan during the second quarter in 2021. The
Company also recorded severance costs of $0.4 million during the first quarter of
2022.
ASSETS HELD FOR SALE
During the first quarter, management committed to a plan to sell
its Russian division, resulting in the associated assets and
liabilities being presented as held for sale. As at March 31, 2022, the carrying value of these
assets was $58.8 million and the
carrying value of the liabilities was $13.9
million. Results from operations held for sale have not been
included in the preceding tables.
Revenue from Calfrac's Russian operations, being held for sale,
decreased by 20 percent during the first quarter of 2022 to
$22.1 million from $27.6 million in the corresponding period of
2021. Fracturing revenue decreased due to changes in job mix
combined with an 11 percent depreciation in the Russian rouble.
Coiled tubing revenue also decreased as activity was concentrated
on port openings rather than cleanouts during the quarter, which
resulted in fewer jobs completed at a lower revenue per job.
The Company's Russian division had an operating loss of
$0.6 million during the first quarter
of 2022 compared to operating income of $1.5
million in the comparable quarter in 2021. The lower
operating margin performance was primarily due to lower than
expected fracturing equipment utilization as operations were
impacted by the start of the war with Ukraine. In addition, the Company halted plans
to reactivate an additional fracturing and coiled tubing fleet in
the quarter. Coiled tubing activity was comprised of lower margin
work during the quarter, which had a negative impact on overall
margins as a percentage of revenue. The Company incurred
$0.2 million of severance costs
during the first quarter in 2022.
NON-GAAP MEASURES
Certain supplementary measures presented in this press release
do not have any standardized meaning under IFRS and, because IFRS
have been incorporated as Canadian generally accepted accounting
principles (GAAP), these supplementary measures are also non-GAAP
measures. These measures have been described and presented in order
to provide shareholders and potential investors with additional
information regarding the Company's financial results, liquidity
and ability to generate funds to finance its operations. These
measures may not be comparable to similar measures presented by
other entities, and are explained below.
Operating income (loss) is defined as net income (loss) before
depreciation, foreign exchange gains or losses, gains or losses on
disposal of property, plant and equipment, gains or losses on
exchange or settlement of debt, impairment of property, plant and
equipment, impairment of other assets, interest, and income taxes.
Management believes that operating income is a useful supplemental
measure as it provides an indication of the financial results
generated by Calfrac's business segments prior to consideration of
how these segments are financed or taxed. In addition, management
believes this measure allows investors to more accurately compare
the Company's performance with its peers by providing an indication
of its financial results prior to consideration of the age or size
of its asset base, or the investment and accounting policies
associated with its assets. Operating income (loss) for the period
was calculated as follows:
Three Months Ended
March 31,
|
2022
|
2021
|
(C$000s)
|
($)
|
($)
|
(unaudited)
|
|
Revised
|
Net loss from
continuing operations
|
(18,030)
|
(23,029)
|
Add back
(deduct):
|
|
|
Depreciation
|
29,954
|
31,569
|
Foreign exchange
losses
|
3,837
|
2,590
|
Loss (gain) on disposal
of property, plant and equipment
|
1,038
|
(387)
|
Interest
|
9,816
|
9,103
|
Income taxes
|
(5,586)
|
(8,382)
|
Operating income from
continuing operations
|
21,029
|
11,464
|
Adjusted EBITDA is defined in the Company's credit facilities
for covenant purposes as net income or loss for the period adjusted
for interest, income taxes, depreciation and amortization,
unrealized foreign exchange losses (gains), non-cash stock-based
compensation, and gains and losses that are extraordinary or
non-recurring. Adjusted EBITDA is presented because it is used in
the calculation of the Company's bank covenants. Adjusted EBITDA
for the period was calculated as follows:
Three Months Ended
March 31,
|
2022
|
2021
|
(C$000s)
|
|
|
(unaudited)
|
|
Revised
|
Net loss from
continuing operations
|
(18,030)
|
(23,029)
|
Add back
(deduct):
|
|
|
Depreciation
|
29,954
|
31,569
|
Unrealized foreign
exchange losses
|
1,904
|
1,692
|
Loss (gain) on disposal
of property, plant and equipment
|
1,038
|
(387)
|
Restructuring
charges
|
701
|
255
|
Stock-based
compensation
|
1,034
|
—
|
Interest
|
9,816
|
9,103
|
Income taxes
|
(5,586)
|
(8,382)
|
Adjusted
EBITDA
|
20,831
|
10,821
|
(1) For bank covenant
purposes, EBITDA includes $0.8 million loss from discontinued
operations for the three months ended March 31, 2022 (three months
ended March 31, 2021 – $1.1 million income) and the deduction of an
additional $2.4 million of lease payments for the three months
ended March 31, 2022 (three months ended March 31, 2021 – $2.1
million) that would have been recorded as operating expenses prior
to the adoption of IFRS 16.
|
CONSOLIDATED BALANCE
SHEETS
|
March
31,
|
December 31,
|
|
2022
|
2021
|
(C$000s)
(unaudited)
|
($)
|
($)
|
ASSETS
|
|
|
Current
assets
|
|
|
Cash and cash
equivalents
|
11,821
|
—
|
Accounts
receivable
|
205,378
|
189,835
|
Income taxes
recoverable
|
2,168
|
2,859
|
Inventories
|
79,027
|
101,840
|
Prepaid expenses and
deposits
|
8,392
|
12,999
|
|
306,786
|
307,533
|
Assets classified as
held for sale
|
58,752
|
—
|
|
365,538
|
307,533
|
Non-current
assets
|
|
|
Property, plant and
equipment
|
534,871
|
563,423
|
Right-of-use
assets
|
20,862
|
22,005
|
|
555,733
|
585,428
|
Total assets
|
921,271
|
892,961
|
LIABILITIES AND
EQUITY
|
|
|
Current
liabilities
|
|
|
Bank
overdraft
|
—
|
1,351
|
Accounts payable and
accrued liabilities
|
153,572
|
127,441
|
Bridge loan
|
15,000
|
—
|
Current portion of
lease obligations
|
7,968
|
8,004
|
|
176,540
|
136,796
|
Liabilities directly
associated with assets classified as held for sale
|
13,929
|
—
|
|
190,469
|
136,796
|
Non-current
liabilities
|
|
|
Long-term
debt
|
397,060
|
388,479
|
Lease
obligations
|
11,199
|
12,560
|
Deferred income tax
liabilities
|
20,348
|
26,286
|
|
428,607
|
427,325
|
Total
liabilities
|
619,076
|
564,121
|
Capital
stock
|
804,446
|
801,178
|
Conversion rights on
convertible notes
|
4,717
|
4,764
|
Contributed
surplus
|
69,292
|
68,258
|
Warrants
|
38,311
|
40,282
|
Loan receivable for
purchase of common shares
|
(2,500)
|
(2,500)
|
Accumulated
deficit
|
(613,759)
|
(592,221)
|
Accumulated other
comprehensive income
|
1,688
|
9,079
|
Total equity
|
302,195
|
328,840
|
Total liabilities and
equity
|
921,271
|
892,961
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
Three Months Ended
March 31,
|
|
2022
|
2021
|
(C$000s, except per
share data)
|
($)
|
($)
|
|
|
Revised
|
Revenue
|
294,524
|
213,954
|
Cost of
sales
|
290,824
|
223,551
|
Gross profit
(loss)
|
3,700
|
(9,597)
|
Expenses
|
|
|
Selling, general and
administrative
|
12,625
|
10,508
|
Foreign exchange
losses
|
3,837
|
2,590
|
Loss (gain) on disposal
of property, plant and equipment
|
1,038
|
(387)
|
Interest
|
9,816
|
9,103
|
|
27,316
|
21,814
|
Loss before income
tax
|
(23,616)
|
(31,411)
|
Income tax expense
(recovery)
|
|
|
Current
|
44
|
28
|
Deferred
|
(5,630)
|
(8,410)
|
|
(5,586)
|
(8,382)
|
Net loss from
continuing operations
|
(18,030)
|
(23,029)
|
Net (loss) income from
discontinued operations
|
(3,508)
|
611
|
Net loss for the
period
|
(21,538)
|
(22,418)
|
|
|
|
(Loss) earnings per
share – basic
|
|
|
Continuing
operations
|
(0.47)
|
(0.62)
|
Discontinued
operations
|
(0.09)
|
0.02
|
|
(0.56)
|
(0.60)
|
|
|
|
(Loss) earnings per
share – diluted
|
|
|
Continuing
operations
|
(0.47)
|
(0.62)
|
Discontinued
operations
|
(0.09)
|
0.01
|
|
(0.56)
|
(0.60)
|
CONSOLIDATED STATEMENTS OF
COMPREHENSIVE LOSS
|
Three Months Ended
March 31,
|
|
2022
|
2021
|
(C$000s)
(unaudited)
|
($)
|
($)
|
Net loss for the
period
|
(21,538)
|
(22,418)
|
Other comprehensive
income (loss)
|
|
|
Items that may be
subsequently reclassified to profit or loss:
|
|
|
Change in foreign
currency translation adjustment
|
(7,391)
|
(3,238)
|
Comprehensive
loss
|
(28,929)
|
(25,656)
|
CONSOLIDATED STATEMENTS OF CHANGES
IN EQUITY
|
Share
Capital
|
Conversion
Rights on
Convertible
Notes
|
Contributed
Surplus
|
Warrants
|
Loan
Receivable
for Purchase of
Common Shares
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Accumulated
Deficit
|
Total
Equity
|
(C$000s)
(unaudited)
|
($)
|
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
Balance – January 1,
2022
|
801,178
|
4,764
|
68,258
|
40,282
|
(2,500)
|
9,079
|
(592,221)
|
328,840
|
Net loss
|
—
|
|
—
|
—
|
—
|
—
|
(21,538)
|
(21,538)
|
Other comprehensive
income (loss):
|
|
|
|
|
|
|
|
|
Cumulative translation
adjustment
|
—
|
—
|
—
|
—
|
—
|
(7,391)
|
—
|
(7,391)
|
Comprehensive
loss
|
—
|
—
|
—
|
—
|
—
|
(7,391)
|
(21,538)
|
(28,929)
|
Stock
options:
|
|
|
|
|
|
|
|
|
Stock-based
compensation recognized
|
—
|
—
|
1,034
|
—
|
—
|
—
|
—
|
1,034
|
Conversion of 1.5 Lien
Notes into shares
|
593
|
(47)
|
—
|
—
|
—
|
—
|
—
|
546
|
Warrants:
|
|
|
|
|
|
|
|
|
Proceeds from issuance
of shares
|
2,675
|
—
|
—
|
(1,971)
|
—
|
—
|
—
|
704
|
Balance –
March 31, 2022
|
804,446
|
4,717
|
69,292
|
38,311
|
(2,500)
|
1,688
|
(613,759)
|
302,195
|
Balance – January 1,
2021
|
800,184
|
4,873
|
65,986
|
40,797
|
(2,500)
|
10,303
|
(509,409)
|
410,234
|
Net loss
|
—
|
—
|
—
|
—
|
—
|
—
|
(22,418)
|
(22,418)
|
Other comprehensive
income (loss):
|
|
|
|
|
|
|
|
|
Cumulative translation
adjustment
|
—
|
—
|
—
|
—
|
—
|
(3,238)
|
—
|
(3,238)
|
Comprehensive
loss
|
—
|
—
|
—
|
—
|
—
|
(3,238)
|
(22,418)
|
(25,656)
|
Rescission of equity
portion of 1.5 Lien Notes
|
—
|
(85)
|
—
|
—
|
—
|
—
|
—
|
(85)
|
Warrants:
|
|
|
|
|
|
|
|
|
Proceeds from issuance
of shares
|
260
|
—
|
—
|
(192)
|
—
|
—
|
—
|
68
|
Balance –
March 31, 2021
|
800,444
|
4,788
|
65,986
|
40,605
|
(2,500)
|
7,065
|
(531,827)
|
384,561
|
CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
Three Months Ended
March 31,
|
|
2022
|
2021
|
(C$000s)
(unaudited)
|
($)
|
($)
|
CASH FLOWS PROVIDED
BY (USED IN)
|
|
|
OPERATING
ACTIVITIES
|
|
|
Net loss for the
period
|
(21,538)
|
(22,418)
|
Adjusted for the
following:
|
|
|
Depreciation
|
30,153
|
31,624
|
Stock-based
compensation
|
1,034
|
—
|
Unrealized foreign
exchange losses
|
4,173
|
2,086
|
Loss (gain) on disposal
of property, plant and equipment
|
1,037
|
(387)
|
Interest
|
9,816
|
9,101
|
Interest
paid
|
(12,463)
|
(10,636)
|
Deferred income
taxes
|
(5,630)
|
(8,410)
|
Changes in items of
working capital
|
9,171
|
(20,822)
|
Cash flows provided by
(used in) operating activities
|
15,753
|
(19,862)
|
FINANCING
ACTIVITIES
|
|
|
Bridge loan
proceeds
|
15,000
|
—
|
Issuance of long-term
debt, net of debt issuance costs
|
8,431
|
18,770
|
Long-term debt
repayments
|
—
|
(1,050)
|
Lease obligation
principal repayments
|
(2,083)
|
(1,807)
|
Proceeds on issuance of
common shares from the exercising of warrants
|
704
|
68
|
Cash flows provided by
financing activities
|
22,052
|
15,981
|
INVESTING
ACTIVITIES
|
|
|
Purchase of property,
plant and equipment
|
(16,104)
|
(10,874)
|
Proceeds on disposal of
property, plant and equipment
|
303
|
187
|
Proceeds on disposal of
right-of-use assets
|
304
|
181
|
Cash flows used in
investing activities
|
(15,497)
|
(10,506)
|
Effect of exchange rate
changes on cash and cash equivalents
|
(7,020)
|
(1,478)
|
Increase (decrease) in
cash and cash equivalents
|
15,288
|
(15,865)
|
(Bank overdraft) cash
and cash equivalents, beginning of period
|
(1,351)
|
29,830
|
Cash and cash
equivalents, end of period
|
13,937
|
13,965
|
ADVISORIES
FORWARD-LOOKING
STATEMENTS
In order to provide Calfrac shareholders and potential investors
with information regarding the Company and its subsidiaries,
including management's assessment of Calfrac's plans and future
operations, certain statements contained in this press release,
including statements that contain words such as "seek",
"anticipate", "plan", "continue", "estimate", "expect", "may",
"will", "project", "predict", "potential", "targeting", "intend",
"could", "might", "should", "believe", "forecast" or similar words
suggesting future outcomes, are forward-looking statements.
In particular, forward-looking statements in this press release
include, but are not limited to, statements with respect to the
Company's debt, liquidity and financial position, and the Company's
expectations and intentions with respect to the foregoing, expected
operating strategies and targets, anticipated pricing for the
Company's services, capital expenditure programs, future financial
resources, anticipated equipment utilization levels, future oil and
natural gas well activity in each of the Company's operating
jurisdictions, the planned sale of the Company's Russia division and its accounting treatment,
results of acquisitions and dispositions, the impact of
environmental regulations, future costs or potential liabilities,
projections of market prices and costs, supply and demand for
oilfield services, expectations regarding the Company's ability to
maintain its competitive position, anticipated benefits of the
Company's competitive position, expectations regarding the
Company's financing activities and restrictions, including with
regard to its Credit Agreement and the indentures pursuant to which
its 1.5 Lien Notes and Second Lien Notes were issued, and its
ability to raise capital, treatment under government regulatory
regimes, commodity prices, anticipated outcomes of specific events
(including exposure and positioning under existing and potential
legal proceedings), expectations regarding trends in, and the
growth prospects of, the global oil and natural gas industry, the
Company's growth strategy and prospects, intentions and strategies
with respect to legal proceedings, evaluation of disclosure
controls and procedures and internal controls over financial
reporting. These statements are derived from certain assumptions
and analyses made by the Company based on its experience and
perception of historical trends, current conditions, expected
future developments and other factors that it believes are
appropriate in the circumstances, including, but not limited to,
the economic and political environment in which the Company
operates, the Company's expectations for its current and
prospective customers' capital budgets and geographical areas of
focus, the effect of environmental, social and governance factors
on customer and investor preferences and capital deployment; the
Company's existing contracts and the status of current negotiations
with key customers and suppliers, the effectiveness of cost
reduction measures instituted by the Company and the likelihood
that the current tax and regulatory regime will remain
substantially unchanged.
Forward-looking statements are subject to a number of known and
unknown risks and uncertainties that could cause actual results to
differ materially from the Company's expectations. Such risk
factors include: volatility of industry conditions including the
level of exploration, development and production for oil and
natural gas in Canada,
the United States, Argentina and Russia and market prices for oil and natural
gas impacting the demand for oilfield services generally; the
availability of capital on satisfactory terms and managing
restrictions resulting from compliance with or breach of debt
covenants and risk of acceleration of indebtedness, including under
the Company's credit facilities, G2S2 Loan, 1.5 Lien Notes
indenture and/or Second Lien Notes indenture; failure to reach any
additional agreements with the Company's lenders; the impact of
events of defaults in respect of other material contracts of the
Company, including but not limited to, cross-defaults resulting in
acceleration of amounts payable thereunder or the termination of
such agreements; sourcing, pricing and availability of raw
materials, component parts, equipment, suppliers, facilities and
skilled personnel; the Company's ability to continue to manage the
effect of the COVID-19 pandemic on its operations; excess oilfield
equipment levels; direct and indirect exposure to volatile
credit markets, including credit rating risk; risks associated with
foreign operations including but not limited to the sanctions and
restrictive measures against Russia by Canada, US and other governments in response
to Russia's invasion of
Ukraine; counter-actions taken by
Russia in response to the
sanctions and other restrictive measures taken by Canada, US and European governments; the
impacts of the Russia-Ukraine conflict on the supply and demand for
oil and gas produced in Russia and
globally; ability to employ and retain skilled and unskilled labour
to meet the Company's needs; the Company's ability to address the
energy transition and adapting equipment and technology based on
government and customer requirements and preferences; dilution
risks associated with the conversion of outstanding convertible
securities and additional equity or debt financings; regional
competition; operating restrictions and compliance costs associated
with legislative and regulatory initiatives relating to hydraulic
fracturing and the protection of workers and the environment;
greenhouse gas regulation risks; fluctuations in foreign
exchange rates; dependence on, and concentration of, major
customers; liabilities and risks, including environmental
liabilities and risks, inherent in oil and natural gas operations;
uncertainties in weather and temperature affecting the duration of
the service periods and the activities that can be completed; the
Company's ability to expand operations; liabilities relating to
legal and/or administrative proceedings including the decisions by
securities regulators and/or the courts; changes in legislation and
the regulatory environment; failure to maintain the Company's
safety standards and record; activist shareholder risks; risk
relating to the Plan of Arrangement; liabilities and risks
associated with prior operations; ability to maintain continuous
improvements in operating equipment and proprietary fluid
chemistries; intellectual property risk; unauthorized access or
breach of confidential information; third party credit risk;
cybersecurity risks; loss of reputation in the marketplace; merger
and acquisition activity amongst oil and natural gas exploration
and production companies; retaining key employees; failure to
realize anticipated benefits of acquisitions and dispositions;
unfavorable tax assessments or changes in administrative tax
practices; and failure to manage growth related risks. Further
information about these and other risks and uncertainties may be
found under "Business Risks" below.
Consequently, all of the forward-looking statements made in this
press release are qualified by these cautionary statements and
there can be no assurance that actual results or developments
anticipated by the Company will be realized, or that they will have
the expected consequences or effects on the Company or its business
or operations. These statements speak only as of the respective
date of this press release or the document incorporated by
reference herein. The Company assumes no obligation to update
publicly any such forward-looking statements, whether as a result
of new information, future events or otherwise, except as required
pursuant to applicable securities laws.
BUSINESS RISKS
The business of Calfrac is subject to certain risks and
uncertainties. Prior to making any investment decision regarding
Calfrac, investors should carefully consider, among other things,
the risk factors set forth in the Company's most recently filed
Annual Information Form, which is specifically incorporated by
reference herein. The Annual Information Form is available through
the Internet on the Canadian System for Electronic Document
Analysis and Retrieval (SEDAR), which can be accessed at
www.sedar.com. Copies of the Annual Information Form may also be
obtained on request without charge from Calfrac at Suite 500, 407 -
8th Avenue S.W., Calgary, Alberta,
Canada, T2P 1E5, or at www.calfrac.com, or by facsimile at
403-266-7381.
The ongoing conflict between Russia and Ukraine has added a level of risk and
uncertainty around the Company's operations in Russia. As a result of these changes in
circumstances, the risk and uncertainty surrounding banking
restrictions and the ability to repatriate funds to Canada from Russia, the Company's ownership and control
over its Russian subsidiary, the physical security of property,
plant and equipment, collectability of accounts receivable, and
overall business and operational risks are being monitored.
ADDITIONAL INFORMATION
Further information regarding Calfrac Well Services Ltd.,
including the most recently filed Annual Information Form, can be
accessed on the Company's website at www.calfrac.com or under the
Company's public filings found at www.sedar.com.
FIRST QUARTER CONFERENCE
CALL
Calfrac will be conducting a conference call for interested
analysts, brokers, investors and news media representatives to
review its 2022 first-quarter results at 10:00 a.m. (Mountain Time) on Tuesday, May 3,
2022. The conference call dial-in number is 1-888-204-4368 or
647-794-4605. The seven-day replay numbers are 1-888-203-1112 or
647-436-0148 (once connected, enter 8730471). A webcast of the
conference call may be accessed via the Company's website at
www.calfrac.com.
SOURCE Calfrac Well Services Ltd.