Newalta Reports Solid Third Quarter 2012 Results, Announces

Newalta Reports Solid Third Quarter 2012 Results, Announces $190
Million 2013 Capital Budget and Reorganizes For Growth 
CALGARY, ALBERTA -- (Marketwire) -- 11/07/12 -- Newalta Corporation
("Newalta") (TSX:NAL) today reported solid financial results for the
third quarter ended September 30, 2012.  
FINANCIAL HIGHLIGHTS(1)  


 
                  Three months ended            Nine months ended           
                      September 30,                September 30,            
($000s except per                                                           
 share data)                        % Increase                   % Increase 
 (unaudited)          2012     2011 (Decrease)     2012     2011 (Decrease) 
----------------------------------------------------------------------------
Revenue            190,136  182,023          4  527,764  498,739          6 
Gross profit        49,007   44,860          9  130,721  122,769          6 
- % of revenue          26%      25%         4       25%      25%         - 
Net earnings        15,236   11,815         29   38,681   27,532         40 
- per share ($) -                                                           
 basic                0.31     0.24         29     0.79     0.57         39 
- per share ($) -                                                           
 basic adjusted(2)    0.32     0.25         28     0.67     0.66          2 
- per share ($) -                                                           
 diluted              0.31     0.24         29     0.78     0.56         39 
Adjusted EBITDA(2)  42,526   41,871          2  108,846  109,798         (1)
- per share ($)(2)    0.87     0.86          1     2.24     2.26         (1)
Cash from                                                                   
 operations         11,867   13,177        (10)  49,786   53,173         (6)
- per share ($)       0.24     0.27        (11)    1.02     1.10         (7)
Funds from                                                                  
 operations(2)      41,756   41,309          1   94,312   97,423         (3)
- per share ($)(2)    0.86     0.85          1     1.94     2.01         (3)
Maintenance                                                                 
 capital                                                
                    
 expenditures(2)    11,671    9,393         24   22,863   19,137         19 
Growth capital                                                              
 expenditures(2)    20,659   23,141        (11)  92,077   53,255         73 
Dividends declared   4,870    3,889         25   13,494   10,930         23 
- per share ($)(2)    0.10     0.08         25     0.28     0.23         22 
Dividends paid       4,870    3,889         25   12,512   10,194         23 
Book value per                                                              
 share, September                                                           
 30                  11.62    11.12          4    11.62    11.12          4 
Weighted average                                                            
 shares                                                                     
 outstanding        48,698   48,607          -   48,666   48,556          - 
Shares                                                                      
 outstanding,                                                               
 September 30(3)    48,698   48,607          -   48,698   48,607          - 
----------------------------------------------------------------------------

 
(1) Management's Discussion and Analysis and Newalta's Unaudited
Condensed Consolidated Financial Statements and notes are attached.
References to Generally Accepted Accounting Principles ("GAAP") are
synonymous with IFRS and references to Unaudited Condensed
Consolidated Financial Statements and notes are synonymous with
Financial Statements.   
(2) These financial measures do not have any standardized meaning
prescribed by GAAP and are therefore unlikely to be comparable to
similar measures presented by other issuers. Non-GAAP financial
measures are identified and defined later in this document.   
(3) Newalta has 54,213,679 shares outstanding as at November 7, 2012. 
Management Commentary 
"Results in the quarter reflect continued improvements in our key
growth markets and increased demand for our services," said Al
Cadotte, Newalta's President and CEO. "With many outstanding organic
growth opportunities across all areas of our business, particularly
our U.S. operations and heavy oil contract operations, we are
expanding our capital investment plan to aggressively pursue
high-return, low-risk opportunities that will provide excellent
returns for our investors in 2013 and beyond." 
Realigning for Growth 
Newalta announced that effective January 1, 2013, we will realign our
reporting structure into three divisions - New Markets, Oilfield and
Industrial.   
"This new structure best aligns our operations with our customers so
that we can provide a seamless service package, and also focus our
efforts on developing new and innovative solutions for our national
and international customers. It also provides the optimum structure
to allocate management to execute our growth plans," said Mr.
Cadotte. "The reorganization will result in enhanced disclosure to
our investors, particularly on our New Markets division." 
The reorganization of the three new divisions will be as follows: 
New Markets 


 
--  Heavy Oil Business Unit (includes heavy oil facilities and onsite) 
--  U.S. Business Unit (includes U.S. facilities, drill site and onsite) 

 
 Oilfield  


 
--  Includes oilfield facilities, oilfield onsite, environmental services
    and Canadian drill site 

 
Industrial 


 
--  Western Business Unit (includes oil recycling, industrial facilities and
    industrial onsite in western Canada) 
--  Eastern Business Unit (includes VSC, SCL, industrial facilities and
    industrial onsite in eastern Canada)  

 
Newalta will maintain the current reporting structure of Facilities
and Onsite divisions for the remainder of fiscal 2012. 
2013 Capital Expenditure Budget  
Growth capital in 2012 is expected to be $125 million, or $10 million
above budget, bringing our total capital spend to approximately $155
million. The increase is attributable to the significant expansion in
scope of the mature fine tailings ("MFT") processing contract.
Reflecting the strength of our pipeline of capital projects and
organic growth opportunities, our 2013 capital budget is $190
million; a 23 percent increase over 2012 capital. Growth capital and
maintenance expenditures are expected to be $155 million and $35
million, respectively. Growth expenditures will comprise of
approximately $70 million for New Markets, $40 million for Oilfield
and $30 million for Industrial. The remaining $15 million in growth
capital expenditures are for Technical Development and corporate
investments. The capital program will be funded through cash flow
from operations and the proceeds from the equity offering that closed
on October 26, 2012. 
Consolidated Financial Overview 
Third quarter revenue grew 4% year-over-year to $190.1 million. Gross
profit rose 9% from Q3 2011 as a result of improved performance in
Onsite driven by increased demand for our services. This was
partially offset by reduced activity in Facilities. Adjusted EBITDA
rose slightly to $42.5 million compared to Q3 2011. Higher gross
profit was tempered by increased Adjusted selling, general and 
administrative ("Adjusted SG&A") expenses to support our continued
growth in 2013. Net earnings rose 29% as a result of lower net
finance charges and deferred income tax expense.  
Year-to-date in 2012, Adjusted EBITDA of $108.8 million was
relatively flat compared to the same period in 2011. Stronger demand
for our services was offset by lower value received for our products
of $8.3 million and higher Adjusted SG&A expenses. 
Operational Overview 
Revenue and gross profit from Facilities in the quarter were $101.7
million and $25.3 million, down 15% and 10%, respectively, from Q3
2011. Western Facilities experienced strong demand for our services
despite decreased oilfield activity. Facilities results were impacted
by lower activity levels at VSC and timing of volumes received at
SCL. Year-to-date revenue and gross profit declined slightly from
prior year to $323.3 million and $78.3 million, respectively,
primarily driven by VSC.  
In Onsite, Q3 revenue increased 42% and gross profit was 41% higher
compared to Q3 2011. Strong demand in most areas was offset by
Canadian drill site which was impacted by lower drilling activity.
During the quarter, we began processing waste volumes under our MFT
contract and we began processing slop oil emulsion volumes on a
customer's site in the Bakken play under a multi-year arrangement.
Year-to-date, revenue and gross profit rose 28% and 24%,
respectively, from the prior year period. Increased contract and
project activity offset the impact of lower drilling activity and
commodity prices.  
Technical Development began the demonstration of new technology at a
Western Facility during the quarter, consistent with its plan. We
expect this process to be in commercial production before the end of
2012. 
Other Highlights 
Capital expenditures for the three and nine months ended September
30, 2012 were $32.3 million and $114.9 million respectively, focused
primarily on growth capital projects in Onsite.  
In July 2012, we entered into an amended and restated extendible
revolving Credit Facility ("Credit Facility"). Key changes to the
Credit Facility include an increase in the borrowing amount from $200
million to $225 million, improved covenant ratio thresholds and
better pricing. 
On October 26th, Newalta completed an equity financing with the
issuance of 5.5 million common shares for gross proceeds of $77
million (net proceeds of approximately $73.5 million). 
On a pro-forma basis as at September 30, 2012, the impact of the
equity financing reduces Newalta's Total debt from $411.5 million to
$338.0 million and improves our Total debt to EBITDA ratio from 2.88
to 2.36. We anticipate ending the year with Total Debt to Adjusted
EBITDA significantly better than our leverage ratio at December 31,
2011. 
On October 17, 2012, DBRS upgraded our issuer rating to BB from BB
(Low) and revised the trend to Stable from Positive. The rating
change is attributable to our execution of the business plan, and our
growing contract business that is more stable with multi-year terms,
strengthening our financial profile. DBRS has also upgraded the
Senior Unsecured Debentures to BB from BB (low) with the trend being
Stable.  
Newalta announced today it has implemented a Dividend Reinvestment
Plan ("DRIP"). The DRIP provides eligible Newalta shareholders with
the opportunity to reinvest their quarterly cash dividend to acquire
additional shares at a purchase price equal to 95% of the average
market price (defined as the volume weighted average trading price of
the shares for the five trading days immediately preceding the
distribution payment date). The first dividend eligible to be
reinvested under the DRIP is the dividend payable to shareholders of
record on December 31, 2012. The full text of the DRIP and an
Enrollment Form are available from Valiant Trust at
www.valianttrust.com or on Newalta's website at www.newalta.com. 
Newalta's Board of Directors declared a third quarter dividend of
$0.10 per share ($0.40 per share annualized) paid October 15, 2012 to
shareholders of record September 28, 2012. This higher dividend rate
established earlier this year reflects our strong financial position
and positive outlook. 
Outlook 
In Q4 2012, we anticipate year-over-year improvement in performance
driven by continued growth in Onsite, higher SCL volumes, increased
production at VSC and strong demand for our services in western
Canada.  
In Onsite, we expect year-over-year improvement in the fourth quarter
to be driven by increased Heavy Oil and U.S. contract and project
work, including gains from the contract to process mature fine
tailings ("MFT"). We continue to focus on growing our portfolio of
longer term contracts, strengthening our foundation of stable cash
flow, and maximizing cash flow from our existing assets.  
We are confident we will continue to deliver attractive returns to
our shareholders in the quarters ahead and expect ongoing improvement
towards our historical corporate Return on capital average of 18%.  
With significant growth from our Onsite contracts, contributions from
the 2012 capital program and strong market demand, we are well
positioned for growth in 2013 and beyond.  
Quarterly Conference Call 
Management will hold a conference call on Thursday, November 8, 2012
at 11:00 a.m. (ET) to discuss Newalta's performance for the third
quarter ended September 30, 2012. To participate in the
teleconference, please call 1-800-736-4594. To access the
simultaneous webcast, please visit www.newalta.com. For those unable
to listen to the live call, a taped broadcast will be available at
www.newalta.com and, until midnight on Thursday, November 15, 2012 by
dialing 1-800-558-5253 and using the pass code 21608731 followed by
the pound sign. The unaudited interim Condensed Consolidated
Financial Statements and MD&A, which contain additional notes and
disclosures, are available on SEDAR at www.sedar.com and on our
website at www.newalta.com under Investor Relations/Financial
Reports. 
About Newalta 
Newalta is North America's leading provider of innovative, engineered
environmental solutions that enable customers to reduce disposal,
enhance recycling and recover valuable resources from industrial
residues. We serve customers onsite directly at their operations and
through a network of 85 facilities in Canada and the U.S. Our proven
processes, portfolio of more than 250 operating permits and excellent
record of safety make us the first choice provider of sustainability
enhancing services to oil, natural gas, petrochemical, refining,
lead, manufacturing and mining markets. With a skilled team of more
than 2,200 people, two decade track record of profitable expansion
and commitment to commercializing new solutions, Newalta is
positioned for sustained future growth and improvement. Newalta
trades on the TSX as NAL. For more information, visit
www.newalta.com. 
SELECTED FINANCIAL INFORMATION 


 
                  Three months ended           Nine months ended            
                      September 30,                September 30,            
($000s, except                                                              
 where otherwise                                                            
 noted)                             % Increase                   % Increase 
 (unaudited)          2012     2011 (Decrease)     2012     2011 (Decrease) 
----------------------------------------------------------------------------
Facilities                                                                  
Revenue            101,715  119,945        (15) 323,318  339,372         (5)
Gross Profit        25,346   28,113        (10)  78,331   80,482         (3)
- % of revenue          25%      23%         9       24%      24%         - 
Revenue by                                                                  
 Business Unit                                                              
 Western                                                                    
  Facilities            58%      50%        16       52%      47%        11 
 Eastern                                                                    
  Facilities            28%      29%        (3)      26%      25%         4 
 VSC                    14%      21%       (33)      22%      28%       (21)
Assets Employed(1)                              640,838  598,
567          7 
Onsite                                                                      
Revenue             88,421   62,078         42  204,446  159,367         28 
Gross Profit        23,661   16,747         41   52,390   42,287         24 
- % of revenue          27%      27%         -       26%      27%        (4)
Revenue by                                                                  
 Business Unit                                                              
 Western Onsite         37%      41%       (10)      43%      42%         2 
 Eastern Onsite         15%      16%        (6)      15%      17%       (12)
 Heavy Oil              48%      43%        12       42%      41%         2 
Assets Employed(1)                              348,099  267,866         30 
Capital                                                                     
 Expenditures                                                               
Maintenance                                                                 
 capital                                                                    
 expenditures       11,671    9,393         24   22,863   19,137         19 
 Facilities          7,585    7,803         (3)  13,996   13,759          2 
 Onsite              2,801    1,103        154    5,513    3,899         41 
Growth capital                                                              
 expenditures       20,659   23,141        (11)  92,077   53,255         73 
 Facilities          8,788    9,167         (4)  24,792   21,486         15 
 Onsite              6,491   10,807        (40)  52,179   24,515        113 
----------------------------------------------------------------------------

 
(1) "Assets employed" is provided to assist management and investors
in determining the effectiveness of the use of the assets at a
divisional level. Assets employed is the sum of capital assets,
intangible assets and goodwill allocated to each division.   
Condensed Consolidated Balance Sheets 
(Unaudited - Expressed in thousands of Canadian Dollars) 


 
                                      September 30, 2012  December 31, 2011 
----------------------------------------------------------------------------
Assets                                                                      
Current assets                                                              
  Cash and cash equivalents                        1,277                  - 
  Accounts and other receivables                 160,430            134,172 
  Inventories                                     39,002             30,953 
  Prepaid expenses and other                      12,866              6,558 
----------------------------------------------------------------------------
                                                 213,575            171,683 
Non-current assets                                                          
  Property, plant and equipment                  892,202            820,102 
  Permits and other intangible assets                                       
   (Note 4)                                       58,911             59,593 
  Other long-term assets                          21,727             10,746 
  Goodwill                                       102,897            102,897 
----------------------------------------------------------------------------
TOTAL ASSETS                                   1,289,312          1,165,021 
----------------------------------------------------------------------------
Equity and Liabilities                                                      
Current liabilities                                                         
  Bank indebtedness                                    -              6,168 
  Accounts payable and accrued                                              
   liabilities                                   159,853            147,897 
  Deferred revenue                                 3,863                  - 
  Dividends payable                                4,870              3,889 
----------------------------------------------------------------------------
                                                 168,586            157,954 
Non-current liabilities                                                     
  Senior secured debt (Note 5)                   147,500             68,493 
  Senior unsecured debentures (Note 6)           245,446            245,049 
  Other liabilities (Note 10)                      3,024              5,459 
  Deferred tax liability                          77,704             68,389 
  Decommissioning liability (Note 7)              80,990             77,756 
----------------------------------------------------------------------------
TOTAL LIABILITIES                                723,250            623,100 
----------------------------------------------------------------------------
Shareholders' Equity                                                        
Shareholders' capital (Note 8)                   318,715            317,386 
Contributed surplus                                2,881              2,700 
Retained earnings                                248,866            223,679 
Accumulated other comprehensive loss              (4,400)            (1,844)
----------------------------------------------------------------------------
TOTAL EQUITY                                     566,062            541,921 
----------------------------------------------------------------------------
TOTAL EQUITY AND LIABILITIES                   1,289,312          1,165,021 
----------------------------------------------------------------------------

 
Condensed Consolidated Statements of Operations 
(Unaudited - Expressed in thousands of Canadian Dollars)  
(Except per share data)  


 
                                   For the three months  For the nine months
                                    ended September 30,  ended September 30,
                                        2012       2011      2012       2011
----------------------------------------------------------------------------
Revenue                              190,136    182,023   527,764    498,739
Cost of sales                        141,129    137,163   397,043    375,970
----------------------------------------------------------------------------
Gross profit                          49,007     44,860   130,721    122,769
----------------------------------------------------------------------------
Selling, general and                                                        
 administrative                       26,574     20,789    71,542     62,045
Research and development                 482        687     1,878      1,898
----------------------------------------------------------------------------
Earnings before finance charges                                             
 and income taxes                     21,951     23,384    57,301     58,826
----------------------------------------------------------------------------
Finance charges                        7,691      6,847    20,956     19,686
Embedded derivative gain (Note 14)    (4,788)         -   (12,838)         -
----------------------------------------------------------------------------
Net financing charges expense          2,903      6,847     8,118     19,686
----------------------------------------------------------------------------
Earnings before income taxes          19,048     16,537    49,183     39,140
----------------------------------------------------------------------------
Deferred taxes                         3,812      4,722    10,502     11,608
----------------------------------------------------------------------------
Net earnings                          15,236     11,815    38,681     27,532
----------------------------------------------------------------------------
Net earnings per share (Note 11)        0.31       0.24      0.80       0.57
Diluted earnings per share (Note                                            
 11)                                    0.31       0.24      0.78       0.56
----------------------------------------------------------------------------
                                                                            
Supplementary information:                                                  
Amortization included within cost                                           
 of sales                             12,277     15,483    34,753     38,000
Amortization included in selling,                                           
 general and administrative            3,316      2,824     9,959      8,455
----------------------------------------------------------------------------
Total amortization                    15,593     18,307    44,712     46,455
----------------------------------------------------------------------------

 
Condensed Consolidated Statements of Comprehensive Income  
(Unaudited - Expressed in thousands of Canadian Dollars) 


 
                             
               For the three      For the nine 
                                             months ended      months ended 
                                            September 30,     September 30, 
                                            2012     2011     2012     2011 
----------------------------------------------------------------------------
Net earnings                              15,236   11,815   38,681   27,532 
Other comprehensive loss:                                                   
 Exchange difference on translating                                         
  foreign operations                      (3,575)       -   (4,018)       - 
 Unrealized gain (loss) on available for                                    
  sale financial assets(1) (Note 14)          32   (1,303)     (95)  (1,716)
 Impairment of available for sale                                           
  financial assets (Note 14)               1,557        -    1,557        - 
----------------------------------------------------------------------------
Other comprehensive loss                  (1,986)  (1,303)  (2,556)  (1,716)
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
Comprehensive income                      13,250   10,512   36,125   25,816 
----------------------------------------------------------------------------

 
(1) Net of tax of nil for the three and nine months ended September
30, 2012 ($0.2 million and $0.3 million for the three and nine months
ended September 30, 2011).  
Condensed Consolidated Statement of Changes in Equity 
(Unaudited - Expressed in thousands of Canadian Dollars) 


 
                                                        Equity   Contributed
                                                    portion of       surplus
                                    Shareholders'  convertible  (share-based
                                          capital   debentures     payments)
----------------------------------------------------------------------------
Balance, December 31, 2010                315,934        1,021         1,679
----------------------------------------------------------------------------
Changes in equity for the nine                                              
 months ended September 30, 2011                                            
Exercise of options                         1,452            -             -
Dividends declared                              -            -             -
Unrealized loss on available for                                            
 sale financial assets                          -            -             -
Net earnings for the period                     -            -             -
----------------------------------------------------------------------------
Balance, September 30, 2011               317,386        1,021         1,679
----------------------------------------------------------------------------
Changes in equity for the three                                             
 months ended December 31, 2011                                             
Redemption of convertible debentures            -       (1,021)        1,021
Dividends declared                              -            -             -
Unrealized loss on available for                                            
 sale financial assets                          -            -             -
Exchange difference on translating                                          
 foreign operations                             -            -             -
Net earnings for the period                     -            -             -
----------------------------------------------------------------------------
Balance, December 31, 2011                317,386            -         2,700
----------------------------------------------------------------------------
Changes in equity for the nine                                              
 months ended September 30, 2012                                            
Exercise of options                         1,510            -             -
Cancellation of shares                       (181)           -           181
Dividends declared                              -            -             -
Unrealized loss on available for                                            
 sale financial assets (Note 14)                -            -             -
Impairment on available for sale                                            
 financial assets (Note 14)                     -            -             -
Exchange difference on translating                                          
 foreign operations                             -            -             -
Net earnings for the period                     -            -             -
----------------------------------------------------------------------------
Balance, September 30, 2012               318,715            -         2,881
----------------------------------------------------------------------------
 
                                                      Accumulated           
                                                            other           
                                         Retained   comprehensive           
                                         earnings   income (loss)     Total 
----------------------------------------------------------------------------
Balance, December 31, 2010                204,935             587   524,156 
----------------------------------------------------------------------------
Changes in equity for the nine                                              
 months ended September 30, 2011                                            
Exercise of options                             -               -     1,452 
Dividends declared                        (10,930)              -   (10,930)
Unrealized loss on available for                                            
 sale financial assets                          -          (1,716)   (1,716)
Net earnings for the period                27,532               -    27,532 
----------------------------------------------------------------------------
Balance, September 30, 2011               221,537          (1,129)  540,494 
----------------------------------------------------------------------------
Changes in equity for the three                                             
 months ended December 31, 2011                                             
Redemption of convertible debentures            -               -         - 
Dividends declared                         (3,888)              -    (3,888)
Unrealized loss on available for                                            
 sale financial assets                          -            (255)     (255)
Exchange difference on translating                                          
 foreign operations                             -            (460)     (460)
Net earnings for the period                 6,030               -     6,030 
----------------------------------------------------------------------------
Balance, December 31, 2011                223,679          (1,844)  541,921 
----------------------------------------------------------------------------
Changes in equity for the nine                                              
 months ended September 30, 2012                                            
Exercise of options                             -               -     1,510 
Cancellation of shares                          -               -         - 
Dividends declared                        (13,494)              -   (13,494)
Unrealized loss on available for                                            
 sale financial assets (Note 14)                -             (95)      (95)
Impairment on available for sale                                            
 financial assets (Note 14)            
         -           1,557     1,557 
Exchange difference on translating                                          
 foreign operations                             -          (4,018)   (4,018)
Net earnings for the period                38,681               -    38,681 
----------------------------------------------------------------------------
Balance, September 30, 2012               248,866          (4,400)  566,062 
----------------------------------------------------------------------------

 
Condensed Consolidated Statements of Cash Flows 
(Unaudited - Expressed in thousands of Canadian Dollars) 


 
                                           For the three       For the nine 
                                            months ended       months ended 
                                           September 30,      September 30, 
                                           2012     2011      2012     2011 
----------------------------------------------------------------------------
Cash provided by (used for):                                                
Operating Activities                                                        
Net earnings                             15,236   11,815    38,681   27,532 
Adjustments for:                                                            
 Amortization                            15,593   18,307    44,712   46,455 
 Income taxes provision                   3,812    4,722    10,502   11,608 
 Income tax refund (paid)                     -      113       (43)    (296)
 Stock-based compensation expense (Note                                     
  10)                                     4,660      152     4,500    3,081 
 Finance charges                          7,691    6,847    20,956   19,686 
 Embedded derivative gain (Note 14)      (4,788)       -   (12,838)       - 
 Finance charges paid                      (443)    (617)  (11,732) (10,581)
 Other                                       (5)     (30)     (426)     (62)
----------------------------------------------------------------------------
Funds from Operations                    41,756   41,309    94,312   97,423 
                                                                            
Increase in non-cash working capital                                        
 (Note 15)                              (28,953) (27,118)  (42,655) (42,605)
Decommissioning costs incurred             (936)  (1,014)   (1,871)  (1,645)
----------------------------------------------------------------------------
Cash from Operating Activities           11,867   13,177    49,786   53,173 
----------------------------------------------------------------------------
Investing Activities                                                        
 Additions to property, plant and                                           
  equipment (Note 15)                   (42,543) (26,279) (109,053) (70,357)
 Other                                      314   (5,661)      748   (5,560)
----------------------------------------------------------------------------
Cash used in Investing Activities       (42,229) (31,940) (108,305) (75,917)
----------------------------------------------------------------------------
Financing Activities                                                        
 Issuance of shares                           -        -       642    1,249 
 Increase in senior secured debt         40,025   31,316    78,496   28,910 
 (Decrease) increase in bank                                                
  indebtedness                           (2,715)  (8,739)   (6,168)   2,615 
 Decrease in note receivable                 72       75       195      164 
 Dividends paid (Note 12)                (4,870)  (3,889)  (12,512) (10,194)
----------------------------------------------------------------------------
Cash from Financing Activities           32,512   18,763    60,653   22,744 
----------------------------------------------------------------------------
 Effect of foreign exchange on cash        (873)       -      (857)       - 
----------------------------------------------------------------------------
Change in cash and cash equivalents       1,277        -     1,277        - 
Cash and cash equivalents, beginning of                                     
 period                                       -        -         -        - 
----------------------------------------------------------------------------
Cash and cash equivalents, end of                                           
 period                                   1,277        -     1,277        - 
----------------------------------------------------------------------------

 
FORWARD-LOOKING STATEMENTS  
Certain statements contained in this document constitute
"forward-looking statements". When used in this document, the words
"may", "would", "could", "will", "intend", "plan", "anticipate",
"believe", "estimate", "expect", and similar expressions, as they
relate to Newalta Corporation and the subsidiaries of Newalta
Corporation, or their management, are intended to identify
forward-looking statements. In particular, forward-looking statements
included or incorporated by reference in this document include
statements with respect to: 


 
--  future operating and financial results; 
--  anticipated industry activity levels; 
--  expected demand for our services; 
--  business prospects and strategy; 
--  capital expenditure programs and other expenditures; 
--  the amount of dividends declared or payable in the future; 
--  realization of anticipated benefits of growth capital investments,
    acquisitions and our technical development initiatives; 
--  our projected cost structure; and 
--  expectations and implications of changes in legislation. 

 
Such statements reflect our current views with respect to future
events and are subject to certain risks, uncertainties and
assumptions, including, without limitation: 


 
--  general market conditions of the industries we service; 
--  strength of the oil and gas industry, including drilling activity; 
--  fluctuations in commodity prices for oil and lead; 
--  fluctuations in interest rates and exchange rates; 
--  supply of waste lead acid batteries as feedstock to support direct lead
    sales; 
--  demand for our finished lead products by the battery manufacturing
    industry; 
--  our ability to secure future capital to support and develop our
    business, including the issuance of additional common shares; 
--  the highly regulated nature of the environmental services and waste
    management business in which we operate; 
--  dependence on our senior management team and other operations management
    personnel with waste industry experience; 
--  the competitive environment of our industry in Canada and the U.S.; 
--  success of our growth, acquisition and technical development strategies
    including integration of businesses and processes into our operations
    and potential liabilities from acquisitions; 
--  potential operational and safety risks and hazards and obtaining
    insurance for such risks and hazards on reasonable financial terms; 
--  the seasonal nature of our operations; 
--  costs associated with operating our landfills and reliance on third
    party waste volumes; 
--  risk of pending and future legal proceedings; 
--  our ability to attract and retain skilled employees and maintain
    positive labour union relationships; 
--  open access for new industry entrants and the general unprotected nature
    of technology used in the waste industry; 
--  possible volatility of the price of, and the market for, our common
    shares, and potential dilution for shareholders in the event of a sale
    of additional shares; 
--  financial covenants in our debt agreements that may restrict our ability
    to engage in transactions or to obtain additional financing; and 
--  such other risks or factors described from time to time in reports we
    file with securities regulatory authorities
. 

 
By their nature, forward-looking statements involve numerous
assumptions, known and unknown risks and uncertainties, both general
and specific, that contribute to the possibility that the
predictions, forecasts, projections and other forward-looking
statements will not occur. Many other factors could also cause actual
results, performance or achievements to be materially different from
any future results, performance or achievements that may be expressed
or implied by such forward-looking statements and readers are
cautioned that the foregoing list of factors is not exhaustive.
Should one or more of these risks or uncertainties materialize, or
should assumptions underlying the forward-looking statements prove
incorrect, actual results may vary materially from those described
herein as intended, planned, anticipated, believed, estimated or
expected. Furthermore, the forward-looking statements contained in
this document are made as of the date of this document and are
expressly qualified by this cautionary statement. Unless otherwise
required by law, we do not intend, or assume any obligation, to
update these forward-looking statements. 
The information contained on our website does not form part of this
press release. 
RECONCILIATION OF NON-GAAP MEASURES  
This Press Release contains references to certain financial measures,
including some that do not have any standardized meaning prescribed
by International Financial Reporting Standards ("IFRS" or "GAAP") and
may not be comparable to similar measures presented by other
corporations or entities. These financial measures are identified and
defined below: 
"EBITDA", "EBITDA per share", "Adjusted EBITDA", and "Adjusted EBITDA
per share" are measures of our operating profitability. EBITDA
provides an indication of the results generated by our principal
business activities prior to how these activities are financed,
assets are amortized or how the results are taxed in various
jurisdictions. In addition, Adjusted EBITDA provides an indication of
the results generated by our principal business activities prior to
recognizing stock-based compensation. Stock-based compensation, a
component of employee remuneration, can vary significantly with
changes in the price of our common shares. As such, Adjusted EBITDA
provides improved continuity with respect to the comparison of our
operating results over a period of time. EBITDA and Adjusted EBITDA
are derived from the consolidated statements of operations,
comprehensive income and retained earnings. EBITDA per share and
Adjusted EBITDA per share are derived by dividing EBITDA and Adjusted
EBITDA by the basic weighted average number of shares.  
They are calculated as follows: 


 
                                       Three months ended  Nine months ended
                                            September 30,      September 30,
($000s)                                     2012     2011      2012     2011
----------------------------------------------------------------------------
Net earnings                              15,236   11,815    38,681   27,532
Add back:                                                                   
    Deferred income taxes                  3,812    4,722    10,502   11,608
    Net Finance charges                    2,903    6,847     8,118   19,686
    Amortization                          15,593   18,307    44,712   46,455
----------------------------------------------------------------------------
EBITDA                                    37,544   41,691   102,013  105,281
----------------------------------------------------------------------------
Add back:                                                                   
  Stock-based compensation expense         4,982      180     6,833    4,517
----------------------------------------------------------------------------
Adjusted EBITDA                           42,526   41,871   108,846  109,798
----------------------------------------------------------------------------
Weighted average number of shares         48,698   48,607    48,666   48,556
----------------------------------------------------------------------------
EBITDA per share                            0.77     0.86      2.10     2.17
----------------------------------------------------------------------------
Adjusted EBITDA per share                   0.87     0.86      2.24     2.26
----------------------------------------------------------------------------

 
"Adjusted net earnings" and "Adjusted net earnings per share" are
measures of our profitability. Adjusted net earnings provides an
indication of the results generated by our principal business
activities prior to recognizing stock-based compensation expense and
the gain or loss on embedded derivatives. Stock-based compensation
expense, a component of employee remuneration, can vary significantly
with changes in the price of our common shares. The gain on the
embedded derivative is a result of the change in the trading price of
the debentures and the volatility of the applicable bond market. As
such, Adjusted net earnings provides improved continuity with respect
to the comparison of our results over a period of time. Adjusted net
earnings per share is derived by dividing Adjusted net earnings by
the basic weighted average number of shares.  


 
                                       Three months ended  Nine months ended
                                            September 30,      September 30,
($000s)                                    2012      2011     2012      2011
----------------------------------------------------------------------------
Net earnings                             15,236    11,815   38,681    27,532
Add back (deduct):                                                          
  Stock-based compensation expense        4,982       180    6,833     4,517
  Embedded derivative gain               (4,788)        -  (12,838)        -
----------------------------------------------------------------------------
Adjusted net earnings                    15,430    11,995   32,676    32,049
----------------------------------------------------------------------------
Adjusted net earnings per share            0.32      0.25     0.67      0.66
----------------------------------------------------------------------------

 
"Book value per share" is used to assist management and investors in
evaluating the book value compared to the market value. 


 
                                                                            
                                             Nine months ended September 30,
($000s)                                                 2012            2011
----------------------------------------------------------------------------
Total Equity                                         566,062         540,494
Shares outstanding, June 30,                          48,698          48,607
----------------------------------------------------------------------------
Book value per share                                   11.62           11.12
----------------------------------------------------------------------------

 
"Funds from operations" is used to assist management and investors in
analyzing cash flow and leverage. Funds from operations as presented
is not intended to represent operating funds from operations or
operating profits for the period, nor should it be viewed as an
alternative to cash flow from operating activities, net earnings or
other measures of financial performance calculated in accordance with
IFRS. Funds from operations is derived from the consolidated
statements of cash flows and is calculated as follows: 


 
                                       Three months ended  Nine months ended
                                            September 30,      September 30,
($000s)                                     2012     2011      2012     2011
----------------------------------------------------------------------------
Cash from operations  
                    11,867   13,177    49,786   53,173
Add back:                                                                   
  Increase in non-cash working capital    28,953   27,118    42,655   42,605
  Decommissioning obligations incurred       936    1,014     1,871    1,645
----------------------------------------------------------------------------
Funds from operations                     41,756   41,309    94,312   97,423
----------------------------------------------------------------------------
Weighted average number of shares         48,698   48,607    48,666   48,556
----------------------------------------------------------------------------
Funds from operations per share             0.86     0.85      1.94     2.01
----------------------------------------------------------------------------

 
"Return on capital" is used to assist management and investors in
measuring the returns realized from capital employed. 


 
($000s)                                             Q3 2012 TTM  Q3 2011 TTM
----------------------------------------------------------------------------
Adjusted EBITDA                                         145,524      143,445
                                                                            
  Total assets                                        1,289,312    1,126,010
  Current liabilities                                   168,586      145,320
----------------------------------------------------------------------------
Capital employed                                      1,120,726      980,690
----------------------------------------------------------------------------
2-Year net assets average                             1,050,708      958,692
----------------------------------------------------------------------------
Return on capital (%)                                      13.9         15.0
----------------------------------------------------------------------------

 
References to EBITDA, EBITDA per share, Adjusted EBITDA, Adjusted
EBITDA per share, Adjusted net earnings, Adjusted net earnings per
share, Funds from operations, Funds from operations per share and
Return on capital throughout this document have the meanings set out
above. 
Contacts:
Newalta Corporation
Anne M. Plasterer
Executive Director, Investor Relations
(403) 806-7019
www.newalta.com