ST. ALBERT, ALBERTA–(Marketwired – May 12, 2016) – Enterprise Group, Inc. (“Enterprise,” or “the Company”) (TSX:E) is pleased to announce its financial results for the three month period ended March 31, 2016 (the “first quarter”).

• Revenue declined 43% to $11,436,212 for the three months ended March 31, 2016 due to:
  • Severe decline in activity of the energy industry, triggered by the reduction in oil prices over the last 21 months;
  • Pricing reductions; and
  • Numerous project delays due to economic uncertainty.

• EBITDA declined to $1,963,249 as a result of the same factors that drove revenue decreases. While Enterprise has taken numerous measures to reduce the Company’s cost structure, it remains committed to the highest service levels.

Utilities/Infrastructure Division

The utilities/infrastructure services division includes operations for T.C. Backhoe & Directional Drilling Ltd. (“TCB”) and Calgary Tunnelling & Horizontal Augering Ltd. Revenue for the three months ended March 31, 2016 was lower compared to 2015, declining by $2,686,479. This decline was primarily the result of the challenges that resulted from a weakened economy in Alberta.

The Utilities/Infrastructure Division generated EBITDA of $1,227,520 during the first quarter, an increase of $120,256 when compared to the prior year. This increase is from various cost cutting measures implemented during fiscal 2015. Cost cutting measures included a reduction in head count, temporary lay-offs and a reduced work week for some of the remaining staff. The Company continues to analyze and implement opportunities to further streamline this division’s cost structure.

Equipment Rental Division

The Equipment Rental Services Division includes operations for Artic Therm International Ltd., Hart Oilfield Rentals Ltd. and Westar Oilfield Rentals Ltd. Revenue for the three months ended March 31, 2016 was lower compared to 2015, declining by $6,096,943. This decline was primarily due to lower activity and discounted rates for the Company’s services. Additionally, warmer weather has had a pronounced impact on the demand for flameless heaters.

The Equipment Rental Services division generated EBITDA of $1,664,009 during the first quarter, a decrease of $2,862,619 when compared to the prior year. This decline was primarily due to the same factors that impacted revenue.

Pricing pressure and workflow reductions continued in the first quarter of 2016. Visibility remains limited for this division’s services for the remainder of 2016, and its customers remain cautious. To address these challenges the Company is streamlining costs where appropriate, however, the Company is committed to certain service standards for its existing clients which management believes to be critical for fostering the Company’s longer-term growth. As the Company better understands the economic outlook for the remainder of 2016 and the likely level of demand for its services, it will adjust its internal infrastructure accordingly.

About Enterprise Group, Inc.

Enterprise Group, Inc. is a consolidator of construction services companies operating in the energy, utility and transportation infrastructure industries. The Company’s focus is primarily construction services and specialized equipment rental. The Company’s strategy is to acquire complementary service companies in Western Canada, consolidating capital, management, and human resources to support continued growth. Enterprise acquired of Artic Therm International Ltd. in September 2012, Calgary Tunnelling & Horizontal Augering Ltd. in June 2013, Hart Oilfield Rentals in January 2014, and Westar Oilfield Rentals Inc. in October 2014. More information is available at the Company’s website, www.enterprisegrp.ca. Also, today’s filings can be found on www.sedar.com

Forward Looking Information

Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company’s future performance. The use of any of the words “could”, “expect”, “believe”, “will”, “projected”, “estimated” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company’s current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company’s Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.

Non-IFRS Measures

The Company uses International Financial Reporting Standards (“IFRS”). EBITDAS is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-IFRS measure. This news release contains references to EBITDAS. This non-IFRS measure used by the Company may not be comparable to a similar measure used by other companies. Management believes that in addition to net income, EBITDAS is a useful supplemental measure as it provides an indication of the results generated by the Company’s principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDAS is calculated as net income excluding depreciation, amortization, interest, taxes and stock based compensation.

Enterprise Group, Inc.
Desmond O’Kell
Senior Vice-President
780-418-4400
[email protected]