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Gibson Energy Inc. Reports Record 2012 Financial Results and Increases Quarterly Dividend

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All financial figures are in Canadian dollars unless otherwise stated

CALGARY, March 5, 2013 /PRNewswire/ - Gibson Energy Inc. ("Gibson" or the "Company"), TSX: GEI, announced today record annual results for 2012 supported by large profit increases across four businesses.

Highlights include:

  • Adjusted EBITDA1 increased by 43% to $96.1 million for the three months ended December 31, 2012 compared to $67.4 million in the three months ended December 31, 2011.  For the full year, 2012 Adjusted EBITDA increased by 31% to $302.1 million compared to $231.3 million in 2011;

  • Earlier today, the Company's Board of Directors approved a 5.8% increase to its quarterly dividend.   The quarterly increase to $0.275 per common share is payable on April 17, 2013 to shareholders of record at the close of business on March 29th, 2013;

  • On October 31, 2012, the Company acquired all of the issued and outstanding common shares of the parent company of OMNI Energy Services Corp. ("OMNI") for total cash consideration of $439.7 million; and

  • In December, the Company received committed support from a large oil sands producer for a 300,000 bbl oil storage tank at Hardisty Terminal and plans to immediately begin construction of this tank on its eastern Hardisty lands. The new 300,000 bbl tank is expected to be commissioned in mid-2014. This commitment is in addition to the two 400,000 bbl oil storage tanks announced in September, 2012.

Our integrated midstream services model delivered outstanding results in 2012," said Stewart Hanlon, Gibson's President and Chief Executive Officer.  "This achievement provides a great start to 2013, which represents Gibson's 60th anniversary as an operating entity.  Despite some economic and industry headwinds, I expect another strong year for the Company as we develop additional infrastructure to meet customer needs and build upon our recent acquisition in the U.S."

Other Highlights for the fourth quarter and year ended December 31, 2012:

  • Cash provided by operations for the three months and year ended December 31, 2012 was $125.2 million and $308.9 million, respectively, compared to $35.9 million and $207.3 million in the three months and year ended December 31, 2011, respectively;

  • Capital expenditures, excluding acquisitions, were $182.2 million in the year ended December 31, 2012, of which $125.7 million related to internal growth projects. The internal growth project expenditures were primarily related to the construction of tankage and pipeline connections at the Company's facilities, in particular at Hardisty, the expansion of the Canadian Environmental Services and the growth of the Truck Transportation and Canwest fleets;

  • In December 2012, the Company announced approval of 2013 capital expenditures of $304.0 million. Of the total capital expenditures $235.0 million or 77% is directed towards growth investments of which $137.0 million or 58% is earmarked for the Terminals and Pipelines segment. The other significant capital expenditures are primarily comprised of growth capital investment in the Truck Transportation and the Environmental Services segments;
  • On October 29, 2012, the Company closed a bought deal offering of subscription receipts which on closing of the acquisition of OMNI were automatically exchanged into common shares of the Company. As a result, the Company issued 18,216,000 common shares at a price of $22.10 per common share for gross proceeds of approximately $402.6 million which were used to finance a portion of the purchase price of OMNI;

  • The Company also completed five other acquisitions in the truck transportation and propane businesses in 2012, totalling $39.3 million;

  • On May 24, 2012, through an amendment of its existing credit agreement, the Company replaced its U.S.$645.0 million senior secured first lien term loan facility with a U.S.$650.0 million senior secured first lien term loan facility and re-priced such loan to reflect a decrease in the interest rate from LIBOR plus 4.5% to LIBOR plus 3.75% and a decrease in the LIBOR Floor from 1.25% to 1.0%. Also, the Company's U.S.$275.0 million revolving credit facility was expanded by U.S.$100.0 million to U.S.$375.0 million; and

  • On March 27, 2012, the Company completed a secondary offering of common shares of the Company held by R/C Guitar Coöperatief U.A., 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 and Riverstone no longer own any common shares of the Company.

______________________________

(1) 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.

Management's Discussion and Analysis and Financial Statements

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

2012 Fourth Quarter and Year End Results Conference Call

A conference call to discuss Gibson's fourth quarter and year end results will be held at 7:00 a.m. MT (9:00 a.m. ET) on Wednesday, March 6, 2013 for interested investors, analysts and media representatives.

The conference call dial-in numbers are:

  • 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 and available for playback 60 minutes after the meeting end time, until May 7, 2013, using the following dial in process:

  • 905-694-9451 / 800-408-3053
  • Pass code:  3806944#

About Gibson

Gibson is one of the largest independent midstream energy companies in Canada and an integrated service provider to the oil and gas industry in the United States. Gibson is engaged in the movement, storage, blending, processing, marketing and distribution of crude oil, condensate, natural gas liquids, water, oilfield waste and refined products.  Gibson transports energy products by utilizing its network of terminals, pipelines, storage tanks, and trucks located throughout western Canada and through its significant truck transportation and injection station network in the United States.  Gibson also provides emulsion treating, water disposal and oilfield waste management services in Canada and the United States 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 5, 2013 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. Distributable cash flow is used to assess the level of cash flow generated from ongoing operations and to evaluate the adequacy of internally generated cash flow to fund dividends. See ''Distributable Cash Flow" in the Company's MD&A for a reconciliation of distributable cash flow to cash flow from operations, the IFRS measure most directly comparable to distributable cash flow.  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.

Fourth Quarter- Selected Financial Highlights
       
  Three months ended Dec 31   Year ended Dec 31
  2012   2011   2012   2011
  (in thousands)
               
Segment Profit*:              
Terminals and Pipelines...................................  $22,753   $22,309   $87,157   $72,081
Truck Transportation.......................................  21,634   19,655   85,499   68,613
Propane and NGL Marketing and Distribution..  20,866   14,532   49,671   40,385
Processing and Wellsite Fluids........................  10,132   9,607   40,068   46,905
Marketing.........................................................  17,918   8,552   58,737   28,674
Environmental Services...................................  8,761   -   8,761   -
Total Segment Profit........................................  102,084   74,655   329,893   256,658
               
Statement of Cash Flows Data:              
Cash flows provided by (used in):              
Operating Activities..........................................  $125,203   $35,912   $308,899   $207,317
Investing Activities............................................  (490,153)   (42,865)   (636,045)   (83,880)
Financing Activities..........................................  384,511   (35,935)   322,827   (66,853)
               
Other Financial Data:              
Capital Expenditures:              
Internal Growth Projects...................................  $34,404   $34,018   $125,662   $111,352
Upgrade and Replacement Capital..................  13,406   7,702   56,536   36,686
Acquisitions......................................................  466,724   51,788   479,026   51,788
               
Adjusted EBITDA.............................................  $96,134   $67,435   $302,076   $231,283
               
               
  Twelve
months ended
Dec 31, 2012
           
Pro Forma Adjusted EBITDA............................  $370,612            
               

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.

 

 

 

 

SOURCE Gibson Energy Inc.



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