Calfrac Announces Third Quarter Results

CALGARY, Nov. 7, 2012 /CNW/ - Calfrac Well Services Ltd. ("Calfrac" or "the 
Company") (TSX: CFW) announces its financial and operating results for the 
three and nine months ended September 30, 2012. 
HIGHLIGHTS                                                             


                  Three Months Ended       Nine Months Ended September
                       September 30,                               30,
                 2012    2011 Change      2012      2011        Change

(C$000s,
except per
share and
unit data)        ($)     ($)    (%)       ($)       ($)           (%)

(unaudited)                                                           

Financial                                                             

Revenue       417,842 440,491    (5) 1,227,729 1,047,355            17

Operating
income((1))    70,604 126,527   (44)   213,795   262,464          (19)

EBITDA((2))    70,874 102,042   (31)   217,605   249,536          (13)


  Per
share - basic    1.59    2.33   (32)      4.92      5.72          (14) 
  Per
share -
diluted          1.58    2.30   (31)      4.87      5.62          (13) 
Net income
attributable
to                                                                     
  the
shareholders
of Calfrac                                                             
  before
foreign
exchange                                                               
  losses
or gains((3))  26,888  69,017   (61)    81,858   120,708          (32) 
  Per
share - basic    0.60    1.58   (62)      1.85      2.77          (33) 
  Per
share -
diluted          0.60    1.56   (62)      1.83      2.72          (33) 
Net income
attributable
to                                                                     
  the
shareholders
of Calfrac     26,917  47,381   (43)    85,903   108,530          (21) 
  Per
share - basic    0.60    1.08   (44)      1.94      2.49          (22) 
  Per
share -
diluted          0.60    1.07   (44)      1.92      2.44          (21) 
Working
capital (end
of period)    353,182 375,823    (6)   353,182   375,823           (6) 
Total equity
(end of
period)       783,091 632,889     24   783,091   632,889            24 
Weighted
average
common                                                                 
  shares
outstanding
(000s)                                                                 


      Basic    44,558  43,767      2    44,214    43,649             1
      Diluted  44,949  44,337      1    44,723    44,436             1
                                                                      

Operating
(end of
period)                                                               

Pumping
horsepower
(000s)                                     845       656            29

Coiled tubing
units (#)                                   29        29             -

Cementing
units (#)                                   25        23             9

((1))  Operating income is defined as net income (loss) before
       depreciation, interest, foreign exchange gains or losses, gains
       or losses on disposal of capital assets 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 how they
       are taxed. Operating income is a measure that does not have any
       standardized meaning under International Financial Reporting
       Standards (IFRS) and, accordingly, may not be comparable to
       similar measures used by other companies.

((2))  EBITDA is defined as net income (loss) before interest, income
       taxes, depreciation and amortization. EBITDA is presented
       because it is frequently used by securities analysts and others
       for evaluating companies and their ability to service debt.
       EBITDA is a measure that does not have any standardized meaning
       prescribed under IFRS and, accordingly, may not be comparable to
       similar measures used by other companies.

((3))  Net income attributable to the shareholders of Calfrac before
       foreign exchange gains or losses is defined as net income (loss)
       attributable to the shareholders of Calfrac before foreign
       exchange gains or losses on an after-tax basis. Management
       believes that net income attributable to the shareholders of
       Calfrac before foreign exchange gains or losses is a useful
       supplemental measure as it provides an indication of the
       financial results generated by Calfrac without the impact of
       foreign exchange fluctuations, which are not fully controllable
       by the Company. Net income attributable to the shareholders of
       Calfrac before foreign exchange gains or losses is a measure
       that does not have any standardized meaning prescribed under
       IFRS and, accordingly, may not be comparable to similar measures
       used by other companies.
        

CEO's MESSAGE
I am pleased to present Calfrac's operating and financial highlights for the 
three and nine months ended September 30, 2012 and to discuss the Company's 
prospects for the remainder of 2012 and beyond. During the third quarter, the 
Company:
    --  achieved strong third quarter revenue, despite customers
        continuing to adjust their capital spending programs due to the
        ongoing weakness in natural gas prices and volatility in crude
        oil prices; and
    --  remained active in the early-stage development of many emerging
        unconventional resource plays in North America.

Financial Highlights

For the three months ended September 30, 2012, the Company recorded:
    --  revenue of $417.8 million, a decrease of 5 percent from the
        third quarter of 2011 driven primarily by lower pricing in the
        United States combined with reduced activity in Canada due to a
        decline in overall drilling and completion activity in Canada
        as customers continued to adjust their capital spending
        programs due to the weakness in natural gas prices. The revenue
        decline in Canada and the United States was partially offset by
        strong growth in Calfrac's Latin American operations;
    --  operating income of $70.6 million versus $126.5 million in the
        same quarter of 2011, mainly due to the impact of competitive
        pricing pressures in the United States market combined with
        higher product costs in Canada and the United States;
    --  EBITDA of $70.9 million or $1.58 per share diluted versus
        $102.0 million or $2.30 per share diluted in the comparable
        quarter of 2011; and
    --  net income attributable to shareholders of Calfrac of $26.9
        million or $0.60 per share diluted, including a $0.4 million
        foreign exchange gain, compared to net income of $47.4 million
        or $1.07 per share diluted in the third quarter of 2011, which
        included a primarily unrealized foreign exchange loss of $23.7
        million.

For the nine months ended September 30, 2012, the Company generated:
    --  record year-to-date revenue of $1.2 billion versus $1.0 billion
        in the first nine months of 2011, led by strong growth in
        Calfrac's United States and Latin American operations;
    --  operating income of $213.8 million compared to $262.5 million
        in the same period of 2011, a decrease of 19 percent, mainly as
        a result of higher product costs and competitive pricing
        pressure in Canada and the United States;
    --  EBITDA of $217.6 million or $4.87 per share diluted versus
        $249.5 million or $5.62 per share diluted in the comparable
        period of 2011; and
    --  net income attributable to the shareholders of Calfrac of $85.9
        million or $1.92 per share diluted compared to net income of
        $108.5 million or $2.44 per share diluted in the same period of
        2011.

Operational Highlights

Canada

Activity in the third quarter of 2012 began slowly due to the lingering 
effects of wet weather following an extended spring break-up, combined with 
the impact of lower crude oil prices and high Canadian differentials. In 
August and September, activity increased significantly and was mainly focused 
in the unconventional oil and liquids-rich plays of western Canada. While the 
Company experienced some pricing erosion, pricing stabilized as the quarter 
progressed and Calfrac believes that further pricing pressure is unlikely for 
the remainder of 2012, due to the Company's longstanding customer 
relationships and significant contract coverage in Canada.

During the third quarter the Company was engaged in many of the emerging 
liquids-rich natural gas and oil plays throughout western Canada, such as the 
Beaverhill Lake, Duvernay, Slave Point and Montney. Calfrac was particularly 
active in the Duvernay shale play. Several projects in these plays commenced 
in the third quarter and are expected to continue throughout the next couple 
of quarters. The Company expects that the development of these plays will 
drive further expansion of its Canadian division.

United States

Calfrac's third-quarter results in the United States were dampened by lower 
activity levels, increased pricing competition and higher input costs, which 
resulted in lower operating margins than in the second quarter. Calfrac's 
established presence in its operating areas, combined with significant 
contract coverage, lessened the impact of these factors on the Company's 
results for the third quarter. Calfrac remains focused on managing its 
commodity and logistical requirements for its operations. The significant 
industry shift to unconventional oil basins has resulted in high demand and 
costs for certain grades of proppant, guar and other chemicals, which had a 
negative impact on Calfrac's operating margins. Calfrac was able to avoid a 
more significant negative financial impact in the first half of the year by 
proactively purchasing sufficient guar to cover its requirements. However, the 
spike in the price of guar during the second quarter had a significant 
financial impact on the United States division's financial performance in the 
third quarter. As the cost of guar has begun to come back down in recent 
months, the Company expects this expense to decrease.

Pricing continued to deteriorate during the third quarter in all operating 
regions. Calfrac maintains a disciplined approach to pricing and will not 
compete for work that does not generate a suitable financial return. This 
resulted in lower levels of callout-related activity during the quarter, as 
the Company chose not to compete in what became a predatory pricing 
environment. The pricing decline is primarily driven by the greater 
availability of equipment due to the sharp decline in natural gas-oriented 
drilling and completions combined with the significant increase in fracturing 
capacity in the United States. However, Calfrac's contract-based strategy has 
provided some stability in revenue amidst a very competitive environment.

Calfrac has a large presence in the Bakken oil shale play and Marcellus shale 
natural gas play, which are among the most economic oil and natural gas 
producing plays in the United States. Late in the third quarter, the Company 
completed its new district facility in Smithfield, Pennsylvania, allowing 
Calfrac to efficiently service the southwest portion of the Marcellus shale 
play and most of the emerging Utica play. In addition, Calfrac is in the final 
stages of completing a new district facility in Williston, North Dakota, which 
will serve the Company's expanding presence in that region.

Russia

Third-quarter 2012 results for Calfrac's Russian operations demonstrated 
improvement in both revenue and operating margins from the second quarter of 
2012. Improved weather, a more active customer base and Calfrac's proactive 
management of its operating cost structure combined to deliver the improvement.

Latin America

Calfrac attained record revenue in Mexico during the third quarter of 2012. 
The majority of the Company's activity was focused in the Chicontepec field, 
where new technologies are being deployed in an effort to improve the 
productivity of wells in this region. If such technologies are successful, the 
Company believes that this region will provide a solid platform for 
significant growth in Mexico. Cementing and coiled tubing activity in 
Argentina during the third quarter were consistent with the previous quarter. 
Calfrac continues to expand its geographical and customer base as development 
of several emerging shale natural gas and tight oil plays begin to gain 
momentum. During the third quarter, the Company commenced deploying fracturing 
equipment to Argentina and plans to begin operations before year-end. Calfrac 
continued to expand its cementing operations in Colombia during the third 
quarter and currently operates four cementing crews. The Company was 
successful in a recent long-term cementing services contract tender with one 
of the largest oil and gas producers in that country. This development is 
anticipated to be a growth driver for Calfrac's Colombian operations and it is 
expected that this emerging international market will grow measurably in the 
future.

Outlook and Business Prospects

With the recent improvement in natural gas prices and the stability of crude 
oil prices, Calfrac remains optimistic that North American drilling and 
completion activity in 2013 will increase over 2012, primarily through the 
continued development of unconventional resource plays. Technological 
advancements being applied to tight oil producing reservoirs are expected to 
improve the economics of these plays and spur additional growth in the 
Company's oil-focused revenue base. The improvement in natural gas prices from 
historic lows is also projected to increase activity in Canada and the United 
States, resulting in higher equipment utilization for Calfrac.

The Company anticipates being active in the oil and natural gas resource plays 
of western Canada throughout the remainder of 2012 and into 2013, due to 
Calfrac's strong customer base and long-term contractual arrangements. Well 
completion activity in the numerous unconventional light oil plays is expected 
to grow as many of the emerging plays in the Western Canada Sedimentary Basin 
move to commercial development. However, the Company recognizes that lower 
crude oil prices and high Canadian crude oil differentials may dampen the cash 
flows and capital programs of its customer base. As a result, Calfrac will 
closely monitor its customers' 2013 capital spending plans and prudently 
adjust the Company's operations and cost structure, as required.

The natural gas resource plays of northwest Alberta and northeast British 
Columbia are some of the most economic gas-producing areas in North America 
and activity is expected to increase as the commodity price environment 
improves. Calfrac believes that activity in the liquids-rich reservoirs of the 
Deep Basin and Duvernay plays will continue to be strong throughout 2013 and 
could drive significant future demand for its fracturing and coiled tubing 
services. The Company is also maintaining a leadership position in the 
development of the Montney resource play and expects further operational 
efficiencies to be achieved through the expanded use of 24-hour operations as 
well as pads for completion work.

In the United States, the Company continues to proactively manage its business 
in a very competitive market. Pricing has deteriorated in many of the basins 
in which Calfrac operates, although this has been mitigated by the Company's 
contract position. As Calfrac has demonstrated in the past, it will remain 
keenly focused on managing its cost structure in order to maximize financial 
returns. The Company expects activity to decrease further in the fourth 
quarter of 2012 as some customers have completed a significant portion of 
their 2012 capital budgets. Lower pricing combined with reduced activity will 
likely result in lower operating margins in the fourth quarter. The Company 
remains optimistic that the recovery in natural gas prices combined with the 
stability in crude oil prices will bring more normalized activity levels in 
2013.

Calfrac's two largest operating regions in the United States are the Bakken 
oil shale play in North Dakota and the Marcellus shale gas play in 
Pennsylvania and West Virginia. The Company operates four fracturing fleets in 
the Bakken, two of which are committed to one of the largest operators in the 
area under a long-term minimum commitment contract. While pricing has declined 
in the play generally, Calfrac believes that its contractual position will 
partially mitigate these pressures.

Calfrac believes that the Marcellus shale play has evolved into one of the 
most economic natural gas producing regions in the United States. The Company 
operates three large fracturing spreads in this region, two of which are 
supported by long-term minimum commitment contracts. Calfrac recently 
completed a state-of-the-art district facility in Smithfield, Pennsylvania to 
service this play. Through this base, the Company's operations are also 
well-positioned to service the Marcellus' liquids-rich area or "wet gas 
window", which is becoming more prominent. The facility will also provide the 
capacity to service a large portion of the emerging Utica shale play.

Calfrac expects that equipment utilization in Russia will remain relatively 
high throughout the remainder of 2012 based on its contract position and 
customer commitments to complete their 2012 capital programs. The Company 
remains focused on streamlining its operating costs in an effort to improve 
future financial performance. In addition, the introduction of new drilling 
and completion technologies in Western Siberia, including horizontal drilling 
and multi-stage completions, provide significant future potential to Calfrac. 
Although the adoption of these technologies is in its early stages, Russia has 
experienced an increase in the number of horizontal wells drilled and 
completed during 2012. Over the longer term, Calfrac expects that the 
fracturing of Russian natural gas wells will also become more prevalent as 
Russia is one of the world's largest natural gas producers. This is 
anticipated to also drive additional future demand for the Company's services.

The Mexican oilfield service environment continues to improve as Mexico's 
primary energy producer refocuses on onshore development. As a result, Calfrac 
anticipates that there will be additional opportunities to deploy horizontal 
technology to Mexico's producing regions. The Company expects to participate 
in many tenders over the next several quarters, which could form the basis of 
future growth in this market. In Argentina, the Company remains encouraged by 
the development of a number of unconventional resource plays, which is 
expected to drive oilfield activity over the longer term. Horizontal drilling 
combined with multi-stage fracturing will be key inputs for unlocking these 
reservoirs. To date very limited industry capacity has been sent in-country to 
service these emerging plays. In response to these market opportunities, 
Calfrac is in the midst of deploying fracturing equipment into Argentina, 
which is expected to commence operations late in the fourth quarter. The 
Company entered the Colombian oilfield service market in the third quarter of 
2012. Calfrac has been very encouraged by recent developments in this region 
and expects that it will provide significant opportunities to carry out the 
Company's long-term strategy of deploying leading completion technology to 
regions with strong growth opportunities.

Equipment constructed as part of the Company's 2012 capital program is being 
delivered as planned and the Company expects that the majority will be 
deployed in late 2012 or early 2013. This capital program will be funded by 
cash on hand plus future cash flows. Calfrac's balance sheet is very strong 
and included working capital of $353.2 million and unused credit facilities of 
$246.5 million at the end of the third quarter. Subsequent to September 30, 
2012, the Company increased its credit facilities from $250.0 million to 
$300.0 million and extended the term to September 27, 2016. This provides the 
Company with additional flexibility to pursue long-term growth opportunities 
as they arise.

I would also like to take this opportunity to thank John Grisdale for over ten 
years of service to Calfrac. John recently retired as President of the 
Company's United States Operating Division, a position he had held since 2007. 
The Company has initiated a search for John's replacement and, in the interim, 
Bruce Payne, Calfrac's Vice President, Global Operations, who served as 
President of Calfrac's Canadian Operating Division from 2009 to 2012, has been 
assigned operational responsibility for its United States operations, 
including Health, Safety and Environment. In addition, Umberto Marseglia, 
Calfrac's Vice President, Global Business, will provide additional support and 
direction to the Sales and Marketing and Technical Services teams in the 
United States. Both of these functions report directly to Fernando Aguilar, 
President and Chief Operating Officer.

On behalf of the Board of Directors,

Douglas R. Ramsay
Chief Executive Officer
November 6, 2012

2012 Overview

In the third quarter of 2012, the Company:
    --  reported revenue of $417.8 million, a decrease of 5 percent
        from the third quarter of 2011 driven primarily by lower
        pricing in the United States combined with reduced activity in
        Canada due to a decline in overall drilling and completion
        activity in Canada as customers continued to adjust their
        capital spending programs due to the weakness in natural gas
        prices. The revenue decline in Canada and the United States was
        partially offset by strong growth in Calfrac's Latin American
        operations;
    --  reported operating income of $70.6 million versus $126.5
        million in the same quarter of 2011, mainly due to the impact
        of competitive pricing pressures in the Canada and United
        States markets combined with higher use of more costly
        proppants and higher product costs in both regions; and
    --  reported net income attributable to shareholders of Calfrac of
        $26.9 million or $0.60 per share diluted, including a $0.4
        million foreign exchange gain, compared to net income of $47.4
        million or $1.07 per share diluted in the third quarter of
        2011, which included a mainly unrealized foreign exchange loss
        of $23.7 million.

In the nine months ended September 30, 2012, the Company:
    --  increased revenue by 17 percent to $1.2 billion from $1.0
        billion in the first nine months of 2011, primarily by
        achieving strong growth in activity in Calfrac's United States
        and Latin American operations;
    --  reported operating income of $213.8 million versus $262.5
        million in the same period of 2011, a decrease of 19 percent,
        mainly as a result of higher product costs and competitive
        pricing pressure in Canada and the United States;
    --  reported net income attributable to the shareholders of Calfrac
        of $85.9 million or $1.92 per share diluted compared to net
        income of $108.5 million or $2.44 per share diluted in the same
        period of 2011;
    --  recorded capital expenditures of $223.3 million primarily to
        bolster the Company's fracturing operations; and
    --  reported working capital of $353.2 million at September 30,
        2012.

Financial Overview - Three Months Ended September 30, 2012 Versus 2011

Canada
                                                                       

Three Months Ended September 30,                    2012    2011 Change

(C$000s, except operational information)             ($)     ($)    (%)

(unaudited)                                                            

Revenue                                          200,763 230,011   (13)

Expenses                                                               
      Operating                                  139,527 138,364      1
      Selling, General and Administrative (SG&A)   4,865   4,444      9
                                                 144,392 142,808      1

Operating income((1))                             56,371  87,203   (35)

Operating income (%)                               28.1%   37.9%   (26)

Fracturing revenue per job ($)                   205,452 160,649     28

Number of fracturing jobs                            891   1,317   (32)

Pumping horsepower, end of period (000s)             306     256     20

Coiled tubing revenue per job ($)                 33,852  23,819     42

Number of coiled tubing jobs                         523     774   (32)

Coiled tubing units, end of period (#)                22      22      -

((1))Refer to "Non-GAAP Measures" on page 16 for further information.

Revenue

Revenue from Calfrac's Canadian operations during the third quarter of 2012 
was $200.8 million versus $230.0 million in the comparable three-month period 
of 2011. The decrease in revenue was primarily due to the overall decline in 
natural gas drilling and completions activity in the Western Canada 
Sedimentary Basin. Total drilling activity in western Canada decreased by 
approximately 30 percent during the third quarter of 2012 from the 
corresponding period in 2011. This decrease in activity was partially offset 
by work that was deferred from the second quarter due to an early spring 
break-up as well as an increase in average job sizes resulting from the shift 
in activity towards the oil and liquids-rich areas of western Canada.

Operating Income

Operating income in Canada decreased by 35 percent to $56.4 million during the 
third quarter of 2012 from $87.2 million in the same period of 2011. The 
decrease was primarily due to pricing pressure, lower equipment utilization 
and higher guar expenses, which resulted from cost inflation and the shift in 
activity toward the oil and liquids-rich areas of western Canada.

United States
                                                                    

Three Months Ended September 30,                 2012    2011 Change

(C$000s, except operational and exchange rate
information)                                      ($)     ($)    (%)

(unaudited)                                                         

Revenue                                       158,473 165,114    (4)

Expenses                                                            
      Operating                               130,843 115,094     14
      SG&A                                      4,956   3,729     33
                                              135,799 118,823     14

Operating income((1))                          22,674  46,291   (51)

Operating income (%)                            14.3%   28.0%   (49)

Fracturing revenue per job ($)                 65,508  86,578   (24)

Number of fracturing jobs                       2,335   1,851     26

Pumping horsepower, end of period (000s)          467     333     40

Cementing revenue per job ($)                  29,507  29,985    (2)

Number of cementing jobs                          153     162    (6)

Cementing units, end of period (#)                 11       9     22

US$/C$ average exchange rate((2))              0.9957  0.9800      2

((1))  Refer to "Non-GAAP Measures" on page 16 for further information.

((2))  Source: Bank of Canada.
        

Revenue

Revenue from Calfrac's United States operations decreased by 4 percent during 
the third quarter of 2012 to $158.5 million from $165.1 million in the 
comparable quarter of 2011. The decrease was due primarily to the completion 
of smaller fracturing jobs and competitive pricing pressures in the United 
States market. The decrease in revenue was partially offset by a 26 percent 
increase in fracturing activity resulting from a larger number of fracturing 
fleets operating in the Bakken play of North Dakota.

Operating Income

Operating income in the United States was $22.7 million for the third quarter 
of 2012, a decrease of $23.6 million from the comparative period in 2011. The 
decrease in operating income was primarily due to competitive pricing pressure 
combined with higher product costs. The increase in product expenses was 
mainly due to increases in the price of guar, which is a primary component of 
oil-focused fluid systems. Higher equipment repairs and maintenance expenses 
combined with an increase in the number of SG&A personnel supporting the 
United States operation also contributed to the lower operating income.

Russia
                                                                   

Three Months Ended September 30,                2012    2011 Change

(C$000s, except operational and exchange rate
information)                                     ($)     ($)    (%)

(unaudited)                                                        

Revenue                                       31,228  29,233      7

Expenses                                                           
      Operating                               26,181  24,439      7
      SG&A                                     1,552   1,449      7
                                              27,733  25,888      7

Operating income((1))                          3,495   3,345      4

Operating income (%)                           11.2%   11.4%    (2)

Fracturing revenue per job ($)                99,390 114,816   (13)

Number of fracturing jobs                        220     195     13

Pumping horsepower, end of period (000s)          45      45      -

Coiled tubing revenue per job ($)             60,011  53,884     11

Number of coiled tubing jobs                     156     127     23

Coiled tubing units, end of period (#)             6       6      -

Rouble/C$ average exchange rate((2))          0.0312  0.0336    (7)

((1))  Refer to "Non-GAAP Measures" on page 16 for further information.

((2))  Source: Bank of Canada.
        

Revenue

During the third quarter of 2012, the Company's revenue from Russian 
operations increased by 7 percent to $31.2 million from $29.2 million in the 
corresponding quarter of 2011. The increase in revenue was mainly due to a 23 
percent increase in coiled tubing activity combined with the completion of 
larger coiled tubing jobs. The increase was partially offset by the 
depreciation of the Russian rouble by 7 percent versus the Canadian dollar. 
The 13 percent increase in fracturing activity was completely offset by a 13 
percent decrease in average job sizes due to the Company no longer being 
required to provide proppant to a significant customer in Western Siberia.

Operating Income

Operating income in Russia in the third quarter of 2012 was $3.5 million 
compared to $3.3 million in the corresponding period of 2011. The increase in 
operating income was primarily due to the larger revenue base. The increase 
was mostly offset by higher fuel consumption due to longer travel distances to 
job locations in Western Siberia.

Latin America
                                                                  

Three Months Ended September 30,                2012   2011 Change

(C$000s, except operational and exchange rate
information)                                     ($)    ($)    (%)

(unaudited)                                                       

Revenue                                       27,378 16,133     70

Expenses                                                          
      Operating                               23,649 15,428     53
      SG&A                                     1,739  1,121     55
                                              25,388 16,549     53

Operating income (loss)((1))                   1,990  (416)      -

Operating income (loss) (%)                     7.3%  -2.6%      -

Pumping horsepower, end of period (000s)          27     22     23

Cementing units, end of period (#)                13      9     44

Coiled tubing units, end of period (#)             1      1      -

Mexican peso/C$ average exchange rate((2))    0.0756 0.0796    (5)

Argentine peso/C$ average exchange rate((2))  0.2160 0.2246    (4)

((1))  Refer to "Non-GAAP Measures" on page 16 for further information.

((2))  Source: Bank of Canada.
        

Revenue

Calfrac's operations in Latin America generated total revenue of $27.4 million 
during the third quarter of 2012 versus $16.1 million in the comparable 
three-month period in 2011. For the three months ended September 30, 2012 and 
2011, revenue generated through subcontractors was $5.4 million and $3.2 
million, respectively. The increase in revenue was primarily due to higher 
fracturing activity, job sizes and pricing in Mexico. Higher cementing and 
coiled tubing activity in Argentina combined with a full quarter of cementing 
operations in Colombia also contributed to the increase.

Operating Income

Calfrac's Latin America division generated operating income of $2.0 million 
during the third quarter of 2012 compared to an operating loss of $0.4 million 
in the comparative quarter in 2011. The turn-around in operating income was 
primarily due to higher fracturing activity in Mexico. Higher cementing and 
coiled tubing activity in Argentina also contributed to the positive change 
from operating loss to operating income. The improvement due to higher 
utilization was partially offset by higher personnel costs in Argentina and 
lower than expected cementing equipment utilization in Colombia.

Corporate
                                                   

Three Months Ended September 30,     2012    2011 Change

(C$000s)                              ($)     ($)    (%)

(unaudited)                                             

Expenses                                                
      Operating                     2,848   1,635     74
      SG&A                         11,078   8,261     34
                                   13,926   9,896     41

Operating loss((1))              (13,926) (9,896)     41

% of Revenue                         3.3%    2.2%     50

((1))Refer to "Non-GAAP Measures" on page 16 for further information.

Operating Loss

The 41 percent increase in Corporate operating expenses from the third quarter 
of 2011 was mainly due to an increase in the Company's global operations and 
procurement personnel to support the Company's larger scale of operations. 
These planned additions are designed to support Calfrac's continued focus on 
service quality, operating efficiency and cost management. Stock-based 
compensation in the form of restricted share units also contributed to the 
increase in corporate expenses. The Company granted restricted share units 
during the first quarter of 2012.

Depreciation

For the three months ended September 30, 2012, depreciation expense increased 
by 2 percent to $22.4 million from $21.9 million in the corresponding quarter 
of 2011. The increase in depreciation expense is mainly a result of a larger 
fleet of equipment operating in North America offset partially by the impact 
of fully depreciated componentized assets in Canada and the United States.

Foreign Exchange Gains or Losses

The Company recorded a foreign exchange gain of $0.4 million during the third 
quarter of 2012 versus a $23.7 million foreign exchange loss in the 
comparative three-month period of 2011. Foreign exchange gains and losses 
arise primarily from the translation of net monetary assets or liabilities 
that were held in U.S. dollars in Canada, Russia and Latin America. The 
majority of the Company's foreign exchange gain recorded in the third quarter 
of 2012 was attributable to its Russian operations, which have substantial 
U.S. dollar-denominated liabilities. During the quarter, the U.S. dollar 
weakened against the Russian rouble by approximately 6 percent, resulting in 
unrealized foreign exchange gains related to this indebtedness.

Interest

The Company's interest expense during the third quarter of 2012 was $9.5 
million compared to $8.7 million for the comparable period in 2011. The 
increase is primarily due to non-recurring interest costs in Latin America.

Income Tax Expenses

The Company recorded an income tax expense of $12.3 million during the third 
quarter of 2012 compared to income tax expense of $24.1 million in the 
comparable period of 2011. Lower profitability in the United States resulted 
in the decrease in overall income tax expense.

The effective income tax rate for the three months ended September 30, 2012 
and 2011 was 32 percent and 34 percent, respectively. The mix of earnings in 
the various tax jurisdictions in which Calfrac operates resulted in a lower 
effective tax rate in the third quarter of 2012.

Summary of Quarterly Results
                                                                                            

Three Months       Dec.       Mar.       June       Sept.       Dec.       Mar.       June       Sept.
Ended               31,        31,        30,         30,        31,        31,        30,         30,
                   2010       2011       2011        2011       2011       2012       2012        2012

(unaudited)         ($)        ($)        ($)         ($)        ($)        ($)        ($)         ($)

Financial
(C$000s, except per
share and operating
data)                                                                                                 

Revenue         268,710    337,408    269,456     440,491    490,037    474,107    335,780     417,842

Operating
income((1))      62,184     88,000     47,937     126,527    150,364    113,381     29,810      70,604

EBITDA((1))      62,464     96,897     50,597     102,042    149,146    127,995     18,736      70,874


  Per
share -
basic              1.44       2.23       1.16        2.33       3.40       2.92       0.42        1.59 
  Per
share -
diluted            1.42       2.18       1.14        2.30       3.38       2.87       0.42        1.58 
Net income
(loss)
attributable                                                                                           
  to
shareholders
of Calfrac       16,126     49,078     12,071      47,381     78,921     70,841   (11,855)      26,917 
  Per
share -
basic              0.37       1.13       0.28        1.08       1.80       1.62     (0.27)        0.60 
  Per
share -
diluted            0.37       1.11       0.27        1.07       1.79       1.59     (0.27)        0.60 
Capital
expenditures     47,015     65,777     72,047      85,130    101,008     84,075     75,286      63,962 
Working
capital (end
of period)      341,677    356,370    324,832     375,823    398,526    431,053    357,128     353,182 
Total equity
(end of
period)         502,032    556,277    568,607     632,889    700,569    779,426    747,591     783,091 
                                                                                                   
Operating
(end of
period)                                                                                                
Pumping
horsepower
(000s)              481        530        584         656        719        782        830         845 
Coiled
tubing units
(#)                  29         29         29          29         29         29         29          29 
Cementing
units (#)            21         21         22          23         23         23         23          25 
((1))Refer to "Non-GAAP Measures" on page 16 for further information 
Financial Overview - Nine Months Ended September 30, 2012 Versus 2011 
Canada 


                                                          

Nine Months Ended September 30,             2012    2011 Change

(C$000s, except operational information)     ($)     ($)    (%)

(unaudited)                                                    

Revenue                                  531,306 518,047      3

Expenses                                                       
      Operating                          378,881 346,381      9
      SG&A                                12,892  11,525     12
                                         391,773 357,906      9

Operating income((1))                    139,533 160,141   (13)

Operating income (%)                       26.3%   30.9%   (15)

Fracturing revenue per job ($)           198,892 158,781     25

Number of fracturing jobs                  2,440   2,984   (18)

Pumping horsepower, end of period (000s)     306     256     20

Coiled tubing revenue per job ($)         32,865  23,723     39

Number of coiled tubing jobs               1,400   1,865   (25)

Coiled tubing units, end of period (#)        22      22      -

((1))Refer to "Non-GAAP Measures" on page 16 for further information.

Revenue

Revenue from Calfrac's Canadian operations during the first nine months of 
2012 was $531.3 million versus $518.0 million in the comparable nine-month 
period of 2011. The 3 percent increase in revenue was primarily due to larger 
job sizes as a result of the shift in activity towards the oil and 
liquids-rich regions of western Canada offset by an overall decline in natural 
gas drilling and completions activity in 2012. Revenue generated in oil and 
liquids-rich natural gas plays comprised 75 percent of total Canadian revenue 
during the first nine months of 2012 compared to 69 percent in the same period 
of 2011.

Operating Income

Operating income in Canada decreased by 13 percent to $139.5 million during 
the first nine months of 2012 from $160.1 million in the same period of 2011. 
The decrease is primarily caused by pricing pressure combined with lower 
equipment utilization and higher guar costs resulting from a combination of 
increased pricing and the shift in activity toward the oil and liquids-rich 
areas of western Canada.

United States
                                                                    

Nine Months Ended September 30,                  2012    2011 Change

(C$000s, except operational and exchange rate
information)                                      ($)     ($)    (%)

(unaudited)                                                         

Revenue                                       528,508 405,220     30

Expenses                                                            
      Operating                               413,434 271,315     52
      SG&A                                     15,433   9,988     55
                                              428,867 281,303     52

Operating income((1))                          99,641 123,917   (20)

Operating income (%)                            18.9%   30.6%   (38)

Fracturing revenue per job ($)                 74,539  79,881    (7)

Number of fracturing jobs                       6,823   4,943     38

Pumping horsepower, end of period (000s)          467     333     40

Cementing revenue per job ($)                  31,000  24,173     28

Number of cementing jobs                          481     429     12

Cementing units, end of period (#)                 11       9     22

US$/C$ average exchange rate((2))              1.0025  0.9778      3

((1))  Refer to "Non-GAAP Measures" on page 16 for further information.

((2))  Source: Bank of Canada.
        

Revenue

Revenue from Calfrac's United States operations increased during the first 
nine months of 2012 to $528.5 million from $405.2 million in the comparable 
period of 2011. The increase in United States revenue was due primarily to the 
expansion of fracturing operations in the Bakken play of North Dakota during 
2012 and higher fracturing and cementing activity in the Marcellus shale 
formation in Pennsylvania and West Virginia due to a larger fleet of equipment 
operating for a full year.

Operating Income

Operating income in the United States was $99.6 million for the nine months 
ended September 30, 2012, a decrease of 20 percent from the comparative period 
in 2011. Operating income as a percentage of revenue decreased by 38 percent 
to 19 percent in the first nine months of 2012 from 31 percent in the 
comparative period of 2011. The decrease in operating income as a percentage 
of revenue was primarily due to the impact of competitive pricing pressures 
combined with a greater use of higher-cost proppants and guar-based chemical 
systems in North Dakota, which are more costly than traditional fluid systems 
used in shale gas development. In addition, the Company incurred higher SG&A 
expenses in order to expand its divisional organization to more effectively 
support Calfrac's larger United States operations.

Russia
                                                                   

Nine Months Ended September 30,                 2012    2011 Change

(C$000s, except operational and exchange rate
information)                                     ($)     ($)    (%)

(unaudited)                                                        

Revenue                                       88,569  85,367      4

Expenses                                                           
      Operating                               77,391  71,416      8
      SG&A                                     4,358   5,027   (13)
                                              81,749  76,443      7

Operating income((1))                          6,820   8,924   (24)

Operating income (%)                            7.7%   10.5%   (27)

Fracturing revenue per job ($)                95,561 110,382   (13)

Number of fracturing jobs                        627     561     12

Pumping horsepower, end of period (000s)          45      45      -

Coiled tubing revenue per job ($)             58,954  53,279     11

Number of coiled tubing jobs                     486     440     10

Coiled tubing units, end of period (#)             6       6      -

Rouble/C$ average exchange rate((2))          0.0323  0.0340    (5)

((1))  Refer to "Non-GAAP Measures" on page 16 for further information.

((2))  Source: Bank of Canada.
        

Revenue

During the first nine months of 2012, the Company's revenue from Russian 
operations increased by 4 percent to $88.6 million from $85.4 million in the 
corresponding nine-month period of 2011. The increase in revenue was mainly 
due to higher fracturing and coiled tubing activity combined with the 
completion of larger coiled tubing jobs. This was partially offset by smaller 
fracturing job sizes as a result of the Company no longer providing proppant 
to a significant customer in Western Siberia during 2012, combined with the 5 
percent depreciation in the Russian rouble versus the Canadian dollar.

Operating Income

Operating income in Russia in the first nine months of 2012 was $6.8 million 
compared to $8.9 million in the corresponding period of 2011. The decrease in 
operating income was primarily due to higher guar costs and increased fuel 
expenses.

Latin America
                                                              

Nine Months Ended September 30,                 2012    2011 Change

(C$000s, except operational and exchange rate
information)                                     ($)     ($)    (%)

(unaudited)                                                        

Revenue                                       79,346  38,721    105

Expenses                                                           
      Operating                               69,005  37,568     84
      SG&A                                     4,603   2,546     81
                                              73,608  40,114     83

Operating income (loss)((1))                   5,738 (1,393)      -

Operating income (loss) (%)                     7.2%   -3.6%      -

Pumping horsepower, end of period (000s)          27      22     23

Cementing units, end of period (#)                13       9     44

Coiled tubing units, end of period (#)             1       1      -

Mexican peso/C$ average exchange rate((2))    0.0758  0.0813    (7)

Argentine peso/C$ average exchange rate((2))  0.2245  0.2298    (2)

((1))  Refer to "Non-GAAP Measures" on page 16 for further information.

((2))  Source: Bank of Canada.
        

Revenue

Calfrac's Latin America operations generated total revenue of $79.3 million 
during the first nine months of 2012 versus $38.7 million in the comparable 
nine-month period in 2011. For the nine months ended September 30, 2012 and 
2011, revenue generated through subcontractors was $17.9 million and $7.7 
million, respectively.

The increase in revenue was primarily due to higher fracturing activity in 
Mexico combined with improved pricing. Higher cementing and coiled tubing 
activity in Argentina along with improved cementing activity and larger job 
sizes in Colombia also contributed to the increase in Latin American revenue.

Operating Income

For the nine months ended September 30, 2012, Calfrac's Latin America division 
generated operating income of $5.7 million compared to an operating loss of 
$1.4 million in the comparative period in 2011.

The improvement in operating income was primarily due to improved pricing and 
higher equipment utilization in Mexico and Argentina. This increase was offset 
partially by higher personnel costs in Argentina and lower-than-expected 
equipment utilization in Colombia's cementing operations.

Corporate
                                                        

Nine Months Ended September 30,     2012     2011 Change

(C$000s)                             ($)      ($)    (%)

(unaudited)                                             

Expenses                                                
      Operating                    7,510    4,503     67
      SG&A                        30,427   24,622     24
                                  37,937   29,125     30

Operating loss((1))             (37,937) (29,125)     30

% of Revenue                        3.1%     2.8%     11

((1))Refer to "Non-GAAP Measures" on page 16 for further information.

Operating Loss

The 30 percent increase in Corporate operating expenses from the first nine 
months of 2011 was mainly due to an increase in the number of personnel 
supporting the Company's expanded operations as well as higher stock-based 
compensation expenses resulting from the restricted share units that were 
granted in 2012. The Company commenced granting of restricted share units 
during the first quarter of 2012.

Depreciation

For the nine months ended September 30, 2012, depreciation expense increased 
by 4 percent to $66.7 million from $64.5 million in the corresponding period 
of 2011. The increase in depreciation expense is mainly a result of a larger 
fleet of equipment operating in North America, offset partially by the impact 
of fully depreciated componentized assets in Canada and the United States.

Foreign Exchange Gains or Losses

The Company recorded a foreign exchange gain of $4.4 million during the first 
nine months of 2012 versus a $13.2 million loss in the comparative period of 
2011. Foreign exchange gains and losses arise primarily from the translation 
of net monetary assets or liabilities that were held in U.S. dollars in 
Canada, Russia and Latin America.

Interest

The Company's interest expense during the first nine months of 2012 increased 
from the comparable period of 2011 by $1.0 million to $27.4 million.

Income Tax Expenses

The Company recorded an income tax expense of $38.1 million during the first 
nine months of 2012 compared to income tax expense of $50.3 million in the 
comparable period of 2011. The decrease in overall income tax expense is 
primarily the result of lower profitability in the United States.

The effective income tax rate for the nine-month periods ended September 30, 
2012 and 2011 was 31 percent and 32 percent, respectively.

Liquidity and Capital Resources
                                                                      
                  Three Months Ended Sept.
                                       30, Nine Months Ended Sept. 30,
                      2012            2011      2012              2011

(C$000s)               ($)             ($)       ($)               ($)

(unaudited)                                                           

Cash flows
provided by (used
in):                                                                  


  Operating
activities           2,590          42,196   177,029           144,261 
  Financing
activities        (15,464)         (1,550)   (7,305)           (5,095) 
  Investing
activities        (54,802)        (98,057) (204,277)         (226,317) 
  Effect of
exchange rate
changes on 
        cash
and cash
equivalents        (2,512)          12,551   (2,047)            11,443 
Decrease in cash
and cash
equivalents       (70,188)        (44,860)  (36,600)          (75,708) 
                                                   
Operating Activities 
The Company's cash flow provided by operating activities for the nine months 
ended September 30, 2012 was $177.0 million versus cash flow provided by 
operating activities of $144.3 million in 2011. This increase was primarily 
due to higher revenue in Canada and the United States offset partially by 
lower operating percentages in the United States. At September 30, 2012, 
Calfrac's working capital was approximately $353.2 million, a decrease of 11 
percent from December 31, 2011. The Company reviewed its accounts receivable 
balance in detail at September 30, 2012 and determined that a provision for 
doubtful accounts receivable totalling $1.6 million was adequate. The majority 
of this provision related to a customer that filed for Chapter 11 
restructuring under United States bankruptcy law. 
Financing Activities 
Cash flow used in financing activities during the first nine months of 2012 
was $7.3 million compared to $5.1 million in the comparable 2011 period. 
During the first nine months of 2012, the Company issued $10.5 million of 
Calfrac common shares, received bank loan proceeds of $2.7 million, paid 
dividends of $18.7 million and repaid $1.6 million of finance lease 
obligations. 
On November 18, 2010, Calfrac completed a private placement of senior 
unsecured notes for an aggregate principal of US$450.0 million due on December 
1, 2020, which bear semi-annual interest of 7.50 percent per annum. The 
Company used the net proceeds of the offering to repay indebtedness, including 
the funding of the tender offer for its 7.75 percent senior notes due in 2015, 
as well as for general corporate purposes and to pay related fees and expenses. 
Subsequent to September 30, 2012, the Company increased its credit facilities 
with a syndicate of Canadian chartered banks from $250.0 million to $300.0 
million and extended the term to September 27, 2016, assuming the facility is 
not further extended. The maturity date may be extended by one or more years 
at the Company's request and lenders' acceptance. The Company also has the 
ability to prepay principal without penalty. The facilities consist of an 
operating facility of $20.0 million and a syndicated facility of $280.0 
million. The interest rates for these facilities are based on the parameters 
of certain bank covenants. For prime-based loans, the rate ranges from prime 
plus 0.50 percent to prime plus 1.25 percent. For LIBOR-based loans and 
bankers' acceptance-based loans, the margin thereon ranges from 1.50 percent 
to 2.25 percent above the respective base rates for such loans. As at 
September 30, 2012, the Company had utilized $3.5 million of its credit 
facilities for letters of credit, leaving $246.5 million in available credit 
at such date. 
Investing Activities 
For the nine months ended September 30, 2012, Calfrac's cash flow used in 
investing activities was $204.3 million versus $226.3 million for 2011. 
Capital expenditures were $223.3 million in the first nine months of 2012 
compared to $223.0 million in the same period of 2011. Capital expenditures 
were primarily related to supporting the Company's fracturing operations 
throughout North America. 
Calfrac's 2012 capital budget is projected to be $271.0 million, of which 
$240.0 million will be directed towards its Canadian and U.S. operations and 
$31.0 million towards operations in Russia and Latin America. In addition to 
the 2012 capital program outlined above, Calfrac expects that the carryover 
amount of approximately $150 million related to its 2011 capital program will 
be completed during the fourth quarter of 2012. The capital program will focus 
on the Company's fracturing operations in Canada and the United States as well 
as facilities and infrastructure capital required to support Calfrac's 
expanding fracturing, coiled tubing and cementing operations in many of the 
most active North American unconventional oil and natural gas markets. A 
portion of this capital is also dedicated to expanding Calfrac's presence in 
the well servicing markets in Argentina and Colombia. 
The effect of changes in foreign exchange rates on the Company's cash and cash 
equivalents during the first nine months of 2012 was a decrease of $2.0 
million versus an increase of $11.4 million during the same period of 2011. 
These changes relate to cash and cash equivalents held by the Company in a 
foreign currency. 
At September 30, 2012, the Company had cash and cash equivalents of $96.5 
million compared to $133.1 million at December 31, 2011. 
With its strong working capital position, unutilized credit facilities and 
anticipated funds provided by operations, the Company expects to have adequate 
resources to fund its financial obligations and planned capital expenditures 
for the remainder of 2012 and beyond. 
Outstanding Share Data 
The Company is authorized to issue an unlimited number of common shares. 
Employees have been granted options to purchase common shares under the 
Company's shareholder-approved stock option plan. The number of shares 
reserved for issuance under the stock option plan is equal to 10 percent of 
the Company's issued and outstanding common shares. As at October 31, 2012, 
there were 44,728,459 common shares issued and outstanding, and 2,963,987 
options to purchase common shares. 
The Company has a Dividend Reinvestment Plan that allows shareholders to 
direct cash dividends paid on all or a portion of their common shares to be 
reinvested in additional common shares that will be issued at 95 percent of 
the volume-weighted average price of the common shares traded on the Toronto 
Stock Exchange during the last five trading days preceding the relevant 
dividend payment date. 
Normal Course Issuer Bid 
The Company filed a Notice of Intention to make a Normal Course Issuer Bid 
(NCIB) with the Toronto Stock Exchange (TSX) on November 2, 2011. Under the 
NCIB, the Company may acquire up to 3,246,216 common shares, which was 10 
percent of the public float outstanding as at October 31, 2011, during the 
period November 7, 2011 through November 6, 2012. The maximum number of common 
shares that may be acquired by the Company during a trading day is 42,392, 
with the exception that the Company is allowed to make one block purchase of 
common shares per calendar week that exceeds such limit. All purchases of 
common shares will be made through the facilities of the TSX at the market 
price of the shares at the time of acquisition. Any shares acquired under the 
bid will be cancelled. To date, the Company purchased 196,800 common shares 
under the NCIB for a total cost of approximately $4.9 million, all financed 
out of working capital. The Company did not purchase any shares under the NCIB 
during the first nine months of 2012. 
The Company also filed a Notice of Intention (the "Renewal Notice") to renew 
the NCIB (the "Renewed NCIB") with the TSX on November 1, 2012. Under the 
Renewed NCIB, the Company may acquire up to 3,318,738 common shares, which was 
10 percent of the public float outstanding as at October 31, 2012, during the 
period November 12, 2012 through November 11, 2013. Subject to the block 
purchase exemption described in the preceding paragraph, the maximum number of 
common shares that may be acquired by the Company during a trading day is 
44,254. All purchases of common shares will be made through the facilities of 
the TSX, alternative trading systems or such other exchanges or marketplaces 
through which the common shares trade from time to time at the market price of 
the shares at the time of acquisition. Any shares acquired under the bid will 
be cancelled. A copy of the Renewal Notice may be obtained by any shareholder, 
without charge, by contacting the Company's Corporate Secretary at 411 - 8(th) 
Avenue S.W., Calgary, Alberta, T2P 1E3, or by telephone at 403-266-6000. 
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 "anticipates", "can", "may", "could", "expect", "believe", "intend", 
"forecast", "will", or similar words suggesting future outcomes, are 
forward-looking statements. Forward-looking statements in this document 
include, but are not limited to, statements with respect to future capital 
expenditures, future financial resources, future oil and natural gas well 
activity, future costs or potential liabilities, outcome of specific events, 
trends in the oil and natural gas industry and the Company's growth prospects 
including, without limitation, its international growth strategy and 
prospects. These statements are derived from certain assumptions and analyses 
made by the Company based on its experience and interpretation of historical 
trends, current conditions, expected future developments and other factors 
that it believes are appropriate in the circumstances, including assumptions 
related to commodity pricing and North American drilling activity. 
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. The most significant risk factors to Calfrac 
relate to prevailing economic conditions; the demand for fracturing and other 
stimulation services during drilling and completion of oil and natural gas 
wells; commodity prices; liabilities and risks, including environmental 
liabilities and risks, inherent in oil and natural gas operations; changes in 
legislation and the regulatory environment; sourcing, pricing and availability 
of raw materials, components, parts, equipment, suppliers, facilities and 
skilled personnel; dependence on major customers; uncertainties in weather and 
temperature affecting the duration of the service periods and the activities 
that can be completed; and regional competition. Readers are cautioned that 
the foregoing list of risks and uncertainties is not exhaustive. 
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. 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 are 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 411 - 8(th) Avenue S.W., 
Calgary, Alberta, Canada, T2P 1E3, or at www.calfrac.com, or by facsimile at 
403-266-7381. 
Non-GAAP Measures 
Certain supplementary measures in this press release do not have any 
standardized meaning as prescribed under IFRS and are therefore considered 
non-GAAP measures. These measures include operating income, EBITDA and net 
income attributable to the shareholders of Calfrac before foreign exchange 
gains and losses. These measures may not be comparable to similar measures 
presented by other entities. These measures have been described and presented 
in this press release in order to provide shareholders and potential investors 
with additional information regarding the Company's financial results, 
liquidity and its ability to generate funds to finance its operations. 
Management's use of these measures has been disclosed further in this press 
release as these measures are discussed and presented. 
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. 
Third Quarter Conference Call 
Calfrac will be conducting a conference call for interested analysts, brokers, 
investors and news media representatives to review its 2012 second quarter 
results at 10:00 a.m. (Mountain Time) on Wednesday, November 7, 2012. The 
conference call dial-in number is 1-888-231-8191 or 647-427-7450. The 
seven-day replay numbers are 1-855-859-2056 or 416-849-0833 (once connected, 
enter 50098288). A webcast of the conference call may be accessed via the 
Company's website at www.calfrac.com. 
CONSOLIDATED BALANCE SHEETS                                


                                           September 30, December 31,

As at                                               2012         2011

(C$000s) (unaudited)                                 ($)          ($)

ASSETS                                                               

Current assets                                                       
      Cash and cash equivalents                   96,455      133,055
      Accounts receivable                        304,247      313,898
      Income taxes recoverable                         -        1,340
      Inventories                                123,600       94,344
      Prepaid expenses and deposits               13,143       10,148
                                                 537,445      552,785

Non-current assets                                                   
      Property, plant and equipment              967,616      825,504
      Goodwill                                    10,523       10,523
      Deferred income tax assets                  16,964       16,309

Total assets                                   1,532,548    1,405,121

LIABILITIES AND EQUITY                                               

Current liabilities                                                  


  Accounts payable and accrued               177,938      149,740
liabilities 


      Income taxes payable                            53            -
      Bank loan (note 3)                           4,916        2,309


  Current portion of long-term debt              481          476
(note 4) 
  Current portion of finance lease               875        1,734
obligations (note 5) 


                                                 184,263      154,259

Non-current liabilities                                              
      Long-term debt (note 4)                    436,138      450,545
      Finance lease obligations (note 5)               -          740
      Other long-term liabilities                    485          774
      Deferred income tax liabilities            128,571       98,234

Total liabilities                                749,457      704,552

Equity attributable to the shareholders of                           
Calfrac

Capital stock (note 6)                           293,570      271,817

Contributed surplus (note 8)                      25,864       24,170

Loan receivable for purchase of common           (2,500)      (2,500)
shares (note 14)

Retained earnings                                469,675      405,954

Accumulated other comprehensive income           (2,867)        1,334
(loss)
                                                 783,742      700,775

Non-controlling interest                           (651)        (206)

Total equity                                     783,091      700,569

Total liabilities and equity                   1,532,548    1,405,121

See accompanying notes to the consolidated financial statements.

CONSOLIDATED STATEMENTS OF OPERATIONS                     
                      Three Months Ended Sept. Nine Months Ended Sept.
                                           30,                     30,
                         2012             2011      2012          2011

(C$000s, except per       ($)              ($)       ($)           ($)
share data)
(unaudited)

Revenue               417,842          440,491 1,227,729     1,047,355

Cost of sales (note   345,454          316,858 1,012,968       795,643
15)

Gross profit           72,388          123,633   214,761       251,712

Expenses                                                              


  Selling,         24,190           19,003    67,713        53,709
general and
administrative 
  Foreign           (358)           23,720   (4,442)        13,244
exchange (gains)
losses 
  Loss (gain) on       88              765       632         (316)
disposal of property,
plant 
        and
equipment 
  Interest          9,504            8,739    27,421        26,436 


                       33,424           52,227    91,324        93,073

Income before income   38,964           71,406   123,437       158,639
tax

Income tax expense                                                    
(recovery)
      Current           3,959            (956)     5,077         1,245
      Deferred          8,350           25,077    32,980        49,095
                       12,309           24,121    38,057        50,340

Net income for the     26,655           47,285    85,380       108,299
period
                                                                      

Net income (loss)                                                     
attributable to:


  Shareholders of  26,917           47,381    85,903       108,530
Calfrac 
  Non-controlling   (262)             (96)     (523)         (231)
interest 
                   26,655           47,285    85,380       108,299 


                                                                      

Earnings per share                                                    
(note 6)
      Basic              0.60             1.08      1.94          2.49
      Diluted            0.60             1.07      1.92          2.44

See accompanying notes to the consolidated financial statements.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME         
                      Three Months Ended Sept. Nine Months Ended Sept.
                      30,                                          30,
                        2012              2011    2012            2011

(C$000s) (unaudited)     ($)               ($)     ($)             ($)

Net income for the    26,655            47,285  85,380         108,299
period

Other comprehensive                                                   
income (loss):


  Change in          145            13,868 (4,316)          10,340
foreign currency
translation
adjustment 
Comprehensive income  26,800            61,153  81,064         118,639
for the period 
Comprehensive income                                                  
(loss) attributable
to: 
  Shareholders of 27,074            61,252  81,702         118,858
Calfrac 
  Non-controlling  (274)              (99)   (638)           (219)
interest 


                      26,800            61,153  81,064         118,639

See accompanying notes to the consolidated financial statements.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
                                                                                  
                           Equity Attributable to the Shareholders of Calfrac                        
                                            Loan
                                      Receivable
                                             for
                                        Purchase   Accumulated
                                              of         Other                          Non-
                    Share Contributed     Common Comprehensive Retained          Controlling    Total
                  Capital     Surplus     Shares Income (Loss) Earnings    Total    Interest   Equity

(C$000s)
(unaudited)           ($)         ($)        ($)           ($)      ($)      ($)         ($)      ($)

Balance - January
1, 2012           271,817      24,170    (2,500)         1,334  405,954  700,775       (206)  700,569

Net income (loss)
for the period          -           -          -             -   85,903   85,903       (523)   85,380

Other
comprehensive
income (loss):                                                                                       


  Cumulative
translation
adjustment              -           -          -       (4,201)        -  (4,201)       (115)  (4,316) 
Comprehensive
income (loss) for
the period              -           -          -       (4,201)   85,903   81,702       (638)   81,064 
Stock options:                                                                                        
  Stock-based
compensation
recognized              -       5,064          -             -        -    5,064           -    5,064 
  Proceeds
from issuance of
shares             13,899     (3,370)          -             -        -   10,529           -   10,529 
Dividend
Reinvestment Plan
shares                                                                                                
  issued
(note 20)           7,854           -          -             -        -    7,854           -    7,854 
Dividends               -           -          -             - (22,182) (22,182)           - (22,182) 
Non-controlling
interest
contribution            -           -          -             -        -        -         193      193 
Balance -
September 30,
2012              293,570      25,864    (2,500)       (2,867)  469,675  783,742       (651)  783,091 
                                                                                                  
Balance - January
1, 2011           263,490      15,468    (2,500)       (4,252)  229,865  502,071        (39)  502,032 
Net income (loss)
for the period          -           -          -             -  108,530  108,530       (231)  108,299 
Other
comprehensive
income (loss):                                                                                        
  Cumulative
translation
adjustment              -           -          -        10,328        -   10,328          12   10,340 
Comprehensive
income (loss) for
the period              -           -          -        10,328  108,530  118,858       (219)  118,639 
Stock options:                                                                                        
  Stock-based
compensation
recognized              -       6,158          -             -        -    6,158           -    6,158 
  Proceeds
from issuance of
shares              9,126     (1,988)          -             -        -    7,138           -    7,138 
Shares cancelled
(note 8)            (105)         105          -             -        -        -           -        - 
Denison Plan of
Arrangement (note
8)                      -       2,206          -             -        -    2,206           -    2,206 
Dividends               -           -          -             -  (3,284)  (3,284)           -  (3,284) 
Balance -
September 30,
2011              272,511      21,949    (2,500)         6,076  335,111  633,147       (258)  632,889 
See accompanying notes to the consolidated financial statements. 
CONSOLIDATED STATEMENTS OF CASH FLOWS                                  


                            Three Months Ended Nine Months Ended Sept.
                                     Sept. 30,                     30,
                                2012      2011      2012          2011

(C$000s) (unaudited)             ($)       ($)       ($)           ($)

CASH FLOWS PROVIDED BY
(USED IN):                                                            

OPERATING ACTIVITIES                                                  


  Net income for the
period                        26,655    47,285    85,380       108,299 
  Adjusted for the
following:                                                             
        Depreciation      22,406    21,897    66,747        64,461 
        Stock-based
compensation                   1,743     1,311     5,064         6,158 
        Unrealized
foreign exchange (gains)
losses                       (4,516)    25,783   (8,433)        13,242 
        Loss (gain) on
disposal of property, plant
and 


                  equipment       88       765       632         (316)
            Interest           9,504     8,739    27,421        26,436


        Deferred income
taxes                          8,350    25,077    32,980        49,095 
  Interest paid            (412)       632  (17,713)      (18,070) 
  Changes in items of
working capital (note 11)   (61,228)  (89,293)  (15,049)     (105,044) 
Cash flows provided by
operating activities           2,590    42,196   177,029       144,261 
FINANCING ACTIVITIES                                                   
  Bank loan proceeds           -     1,162     2,734         1,258 
  Issuance of long-term
debt, net of debt issuance 
        costs                  -     (811)        71         (422) 
  Long-term debt
repayments                     (106)     (109)     (336)       (7,767) 
  Finance lease
obligation repayments          (133)     (326)   (1,599)         (963) 
  Denison Plan of
Arrangement (note 8)               -         -         -         2,206 
  Net proceeds on
issuance of common shares        874     1,818    10,529         7,138 
  Dividends paid (note
20)                         (16,099)   (3,284)  (18,704)       (6,545) 
Cash flows used in
financing activities        (15,464)   (1,550)   (7,305)       (5,095) 
INVESTING ACTIVITIES                                                   
  Purchase of property,
plant and equipment (note
11)                         (55,320)  (98,590) (205,983)     (229,728) 
  Proceeds on disposal
of property, plant and 
        equipment            518       533     1,513         3,389 
  Other                        -         -       193            22 
Cash flows used in
investing activities        (54,802)  (98,057) (204,277)     (226,317) 
Effect of exchange rate
changes on cash and 
  cash equivalents       (2,512)    12,551   (2,047)        11,443 
Decrease in cash and cash
equivalents                 (70,188)  (44,860)  (36,600)      (75,708) 
Cash and cash equivalents,
beginning of period          166,643   185,756   133,055       216,604 
Cash and cash equivalents,
end of period                 96,455   140,896    96,455       140,896 
See accompanying notes to the consolidated financial statements. 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 
For the nine months ended September 30, 2012
(Amounts in text and tables are in thousands of Canadian dollars, except share 
data and certain other exceptions as indicated) (unaudited) 
1. DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND ADOPTION OF IFRS 
Calfrac Well Services Ltd. (the "Company") was formed through the amalgamation 
of Calfrac Well Services Ltd. (predecessor company originally incorporated on 
June 28, 1999) and Denison Energy Inc. ("Denison") on March 24, 2004 under the 
Business Corporations Act (Alberta). The registered office is at 411 - 8(th) 
Avenue S.W., Calgary, Alberta, Canada, T2P 1E3. The Company provides 
specialized oilfield services, including hydraulic fracturing, coiled tubing, 
cementing and other well completion services to the oil and natural gas 
industries in Canada, the United States, Russia, Mexico, Argentina and 
Colombia. 
The Company prepares its financial statements in accordance with Canadian 
generally accepted accounting principles as set out in Part I of the Canadian 
Institute of Chartered Accountants' (CICA) Handbook, which requires publicly 
accountable enterprises to prepare their financial statements under 
International Financial Reporting Standards (IFRS). 
These condensed consolidated interim financial statements were prepared in 
accordance with International Accounting Standard (IAS) 34 Interim Financial 
Reporting using accounting policies consistent with IFRS as issued by the 
International Accounting Standards Board (IASB) and interpretations of the 
International Financial Reporting Interpretations Committee (IFRIC). They 
should be read in conjunction with the annual financial statements for the 
year ended December 31, 2011, which were prepared in accordance with IFRS. 
These financial statements were approved by the Audit Committee of the Board 
of Directors for issuance on November 6, 2012. 
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
These interim consolidated financial statements follow the same accounting 
policies and methods of application as the most recent annual financial 
statements. 
For purposes of calculating income taxes during interim periods, the Company 
utilizes estimated annualized income tax rates. Current income tax expense is 
only recognized when taxable income is such that current income taxes become 
payable. 
3. BANK LOAN 
The Company's Colombian subsidiary has an operating line of credit of which 
US$5,000 was drawn at September 30, 2012 (December 31, 2011 - $2,270). It 
bears interest at the LIBOR rate plus 4.5 percent and is secured by a Company 
guarantee. 
4. LONG-TERM DEBT 
                                         September 30, December 31, 
As at                                                 2012         2011 
(C$000s)                                               ($)          ($) 
US$450,000 senior unsecured notes due                                  
December 1, 2020, 
  bearing interest at 7.5% payable             442,440      457,650
semi-annually 
Less: unamortized debt issuance costs              (7,031)      (7,943) 
                                               435,409      449,707 
$230,000 extendible revolving term loan                                
facility, secured by 
  Canadian and U.S. assets of the                    -            -
Company 
Less: unamortized debt issuance costs              (1,027)      (1,359) 
                                               (1,027)      (1,359) 
US$2,101 mortgage maturing May 2018 bearing                            
interest at U.S. 
prime less 1%, repayable at US$33 per month                            
principal and 
interest, secured by certain real property           2,066        2,399 
ARS819 Argentina term loan maturing December                           
31, 2013 
bearing interest at 18.25%, repayable at                               
ARS61 per month 
principal and interest, secured by a Company           171          274
guarantee 


                                                   436,619      451,021

Less: current portion of long-term debt              (481)        (476)
                                                   436,138      450,545
                                                            

The fair value of the senior unsecured notes, as measured based on the closing 
quoted market price at September 30, 2012, was $438,016 (December 31, 2011 - 
$446,209). The carrying values of the mortgage obligations, term loan and 
revolving term loan facilities approximate their fair values as the interest 
rates are not significantly different from current interest rates for similar 
loans.

The interest rate on the $230,000 revolving term loan facility is based on the 
parameters of certain bank covenants. For prime-based loans, the rate ranges 
from prime plus 0.5 percent to prime plus 1.25 percent. For LIBOR-based loans 
and bankers' acceptance-based loans, the margin thereon ranges from 1.75 
percent to 2.5 percent above the respective base rates for such loans. The 
facility is repayable on or before its maturity date of September 27, 2015, 
assuming the facility is not extended. The maturity date may be extended by 
one or more years at the Company's request and lenders' acceptance. The 
Company also has the ability to prepay principal without penalty. Debt 
issuance costs related to this facility are amortized over the facility's term.

Interest on long-term debt (including the amortization of debt issuance costs) 
for the nine months ended September 30, 2012 was $27,232 (year ended December 
31, 2011 - $36,312).

The Company also has an extendible operating loan facility, which includes 
overdraft protection in the amount of $20,000. The interest rate is based on 
the parameters of certain bank covenants in the same fashion as the revolving 
term facility. Drawdowns under this facility are repayable on September 27, 
2015, assuming the facility is not extended. The term and commencement of 
principal repayments may be extended by one year on each anniversary at the 
Company's request and lender's acceptance. The operating facility is secured 
by the Canadian and U.S. assets of the Company.

At September 30, 2012, the Company had utilized $3,490 of its loan facility 
for letters of credit, leaving $246,510 in available credit.

Subsequent to September 30, 2012, the revolving term loan facility and 
operating loan facility were extended. The revolving term loan facility was 
increased to $280,000 and is based on the parameters of certain bank 
covenants. For prime-based loans, the rate ranges from prime plus 0.5 percent 
to prime plus 1.25 percent. For LIBOR-based loans and bankers' 
acceptance-based loans, the margin thereon ranges from 1.5 percent to 2.25 
percent above the respective base rates for such loans. The facility is 
repayable on or before its maturity date of September 27, 2016, assuming the 
facility is not extended. The maturity date may be extended by one or more 
years at the Company's request and lenders' acceptance. The Company also has 
the ability to prepay principal without penalty.

5. FINANCE LEASE OBLIGATIONS
                                                           
                                            September 30, December 31,

As at                                                2012         2011

(C$000s)                                              ($)          ($)

Finance lease contracts bearing interest at                           
5.68%, repayable at


  $49 per month, secured by certain               899        2,579
equipment 
Less: interest portion of contractual                (24)        (105)
payments 
                                                  875        2,474 
Less: current portion of finance lease              (875)      (1,734)
obligations 


                                                        -          740

The carrying values of the finance lease obligations approximate their fair 
values as the interest rates are not significantly different from current 
rates for similar leases.

6. CAPITAL STOCK

Authorized capital stock consists of an unlimited number of common shares.
                                                              
                                Nine Months Ended          Year Ended
                               September 30, 2012   December 31, 2011

Continuity of Common Shares       Shares   Amount     Shares   Amount
                                     (#) (C$000s)        (#) (C$000s)

Balance, beginning of period  43,709,073  271,817 43,488,099  263,490

Issued upon exercise of stock    646,263   13,899    434,250    9,656
options

Dividend Reinvestment Plan                                           
shares
      issued (note 20)           369,648    7,854          -        -

Shares cancelled (note 8)              -        -   (16,476)    (105)

Purchased under Normal Course          -        -  (196,800)  (1,224)
Issuer Bid

Balance, end of period        44,724,984  293,570 43,709,073  271,817
                                                              

The weighted average number of common shares outstanding for the nine months 
ended September 30, 2012 was 44,214,061 basic and 44,722,718 diluted (nine 
months ended September 30, 2011 - 43,649,499 basic and 44,436,450 diluted). 
The difference between basic and diluted shares is attributable to the 
dilutive effect of stock options issued by the Company as disclosed in note 9.

7. NORMAL COURSE ISSUER BID

The Company received regulatory approval to purchase its own common shares in 
accordance with a Normal Course Issuer Bid for the one-year period November 7, 
2011 through November 6, 2012. No shares were purchased during the period 
January 1, 2012 through September 30, 2012. During the year ended December 31, 
2011, 196,800 common shares were purchased at a cost of $4,926 and, of the 
amount paid, $1,224 was charged to capital stock and $3,702 to retained 
earnings. The common shares were cancelled prior to December 31, 2011.

The Company has filed a Notice of Intention to make a Normal Course Issuer Bid 
with the Toronto Stock Exchange. Under the Normal Course Issuer Bid, the 
Company will be permitted to acquire up to approximately 3.3 million of its 
common shares during the period November 12, 2012 through November 11, 2013. 
Any shares acquired under the bid will be cancelled. A copy of the Notice of 
Intention to make a Normal Course Issuer Bid is available without charge on 
request to the Company's Corporate Secretary.

8. CONTRIBUTED SURPLUS
                                                  
                                     Nine Months   Year Ended
                                           Ended December 31,

Continuity of Contributed Surplus Sept. 30, 2012         2011

(C$000s)                                     ($)          ($)

Balance, beginning of period              24,170       15,468
      Stock options expensed               5,064        8,500
      Stock options exercised            (3,370)      (2,109)
      Shares cancelled                         -          105
      Denison Plan of Arrangement              -        2,206

Balance, end of period                    25,864       24,170

The Plan of Arrangement that governed the amalgamation with Denison in 2004 
included a six-year "sunset clause" which provided that untendered shares 
would be surrendered to the Company aftersix years. On January 19, 2011, 
16,476 common shares of the Company previously held in trust for untendered 
shareholders were cancelled. In addition, the Company became entitled to 
approximately517,000 shares of Denison Mines Corporation. These shareswere 
sold on the Toronto Stock Exchange for net proceeds of approximately $2,189.

For accounting purposes, the cancellation of the 16,476 common shares was 
recorded as a reduction of capital stock and an increase in contributed 
surplus in the amount of $105, which represents the book value of the 
cancelled shares as of the date of amalgamation with Denison on March 24, 
2004. The receipt and sale of the shares of Denison Mines Corporation is 
considered an equity contribution by the Company's owners. Consequently, the 
net proceedsfrom their sale, along with approximately$17 of cash received 
in respect of fractional share entitlements, were added to contributed surplus 
in an amount totalling $2,206.

9. STOCK-BASED COMPENSATION

(a) Stock Options

Nine months ended Sept. 30,                 2012               2011
                                             Average            Average
                                            Exercise           Exercise

Continuity of Stock Options         Options    Price   Options    Price
                                        (#)     (C$)       (#)     (C$)

Balance, beginning of period      3,198,475    23.31 2,583,825    17.50
      Granted during the period     673,400    27.88 1,127,800    34.30
      Exercised for common shares (646,263)    16.29 (409,400)    17.44
      Forfeited                   (272,475)    26.32  (98,275)    25.34

Balance, end of period            2,953,137    25.60 3,203,950    23.18
                                                                

Stock options vest equally over four years and expire five years from the date 
of grant. The exercise price of outstanding options ranges from $8.35 to 
$37.18, with a weighted average remaining life of 2.79 years. When stock 
options are exercised, the proceeds, together with the amount of compensation 
expense previously recorded in contributed surplus, are added to capital stock.

(b) Restricted Share Units

During the first quarter of 2012, the Company commenced granting of restricted 
share units to its employees. These units vest equally over three years and 
are settled either in cash (equal to the market value of the underlying shares 
at the time of exercise) or in Company shares purchased on the open market. 
The fair value of the restricted share units is recognized over the vesting 
period, based on the current market price of the Company's shares. For the 
nine months ended September 30, 2012, $2,670 of compensation expense was 
recognized for restricted share units (nine months ended September 30, 2011 - 
$nil). This amount is included in selling, general and administrative expense. 
There were 246,205 restricted share units outstanding as at September 30, 2012.

10. FINANCIAL INSTRUMENTS

The Company's financial instruments included in the consolidated balance 
sheets are comprised of cash and cash equivalents, accounts receivable, 
accounts payable and accrued liabilities, bank loan, long-term debt and 
finance lease obligations.

The fair values of financial instruments included in the consolidated balance 
sheets, except long-term debt, approximate their carrying amounts. The fair 
value of the senior unsecured notes, based on the closing market price at 
September 30, 2012, was $438,016 before deduction of unamortized debt issuance 
costs (December 31, 2011 - $446,209). The carrying value of the senior 
unsecured notes at September 30, 2012 was $442,440 before deduction of 
unamortized debt issuance costs (December 31, 2011 - $457,650). The fair 
values of the remaining long-term debt and finance lease obligations 
approximate their carrying values, as described in notes 4 and 5.

11. SUPPLEMENTAL CASH FLOW INFORMATION

Changes in non-cash operating assets and liabilities are as follows:
                 Three Months Ended Sept. Nine Months Ended Sept. 30,
                 30,
                     2012            2011     2012               2011

(C$000s)                                                             

Accounts         (93,203)       (120,052)    9,650          (125,478)
receivable

Income taxes        2,744         (1,396)    1,393                626
recoverable /
payable

Inventory         (8,102)        (17,966) (29,256)           (31,624)

Prepaid expenses    2,589         (2,590)  (2,995)            (3,631)
and deposits

Accounts payable   34,795          52,736    6,448             55,172
and accrued
liabilities

Other long-term      (51)            (25)    (289)              (109)
liabilities
                 (61,228)        (89,293) (15,049)          (105,044)

Purchase of property, plant and equipment is comprised of:
                Three Months Ended Sept. Nine Months Ended Sept. 30,
                30,
                    2012            2011      2012              2011

(C$000s)                                                            

Property, plant (63,962)        (85,130) (223,323)         (222,954)
and equipment
additions

Change in                                                           
liabilities
related to
purchase of


  property,    8,642        (13,460)    17,340           (6,774)
plant and
equipment 
            (55,320)        (98,590) (205,983)         (229,728) 
12. CAPITAL STRUCTURE 
The Company's capital structure is comprised of shareholders' equity and 
long-term debt. The Company's objectives in managing capital are (i) to 
maintain flexibility so as to preserve the Company's access to capital markets 
and its ability to meet its financial obligations, and (ii) to finance growth, 
including potential acquisitions. 
The Company manages its capital structure and makes adjustments in light of 
changing market conditions and new opportunities, while remaining cognizant of 
the cyclical nature of the oilfield services sector. To maintain or adjust its 
capital structure, the Company may revise its capital spending, adjust 
dividends paid to shareholders, issue new shares or new debt or repay existing 
debt. 
The Company monitors its capital structure and financing requirements using, 
amongst other parameters, the ratio of long-term debt to cash flow. Cash flow 
for this purpose is calculated on a 12-month trailing basis and is defined 
below. 
                                         September 30, December 31, 
For the twelve months ended                           2012         2011 
(C$000s)                                               ($)          ($) 
Net income                                         164,238      187,157 
Adjusted for the following:                                             
Depreciation                                      89,743       87,457 
Amortization of debt issuance costs and            1,240        1,207
  debt discount 
Stock-based compensation                           7,406        8,500 
Unrealized foreign exchange (gains) losses       (9,730)       11,945 
Loss (gain) on disposal of property, plant           860         (88)
  and equipment 
Deferred income taxes                             70,922       87,037 
Cash flow                                          324,679      383,215 
                                           
The ratio of long-term debt to cash flow does not have any standardized 
meaning under IFRS and may not be comparable to similar measures used by other 
companies. 
At September 30, 2012, the long-term debt to cash flow ratio was 1.34:1 
(December 31, 2011 - 1.18:1) calculated on a 12-month trailing basis as 
follows: 
                                    September 30, December 31, 
As at                                            2012         2011 
(C$000s, except ratio)                            ($)          ($) 
Long-term debt (net of unamortized debt       436,619      451,021
issuance costs) (note 4) 
Cash flow                                     324,679      383,215 
Long-term debt to cash flow ratio              1.34:1       1.18:1 


                                                       

The Company is subject to certain financial covenants relating to working 
capital, leverage and the generation of cash flow in respect of its operating 
and revolving credit facilities. These covenants are monitored on a monthly 
basis. The Company is in compliance with all such covenants.

The Company's capital management objectives, evaluation measures and targets 
have remained unchanged over the periods presented.

13. PURCHASE OBLIGATIONS

The Company has obligations for the purchase of products, services and capital 
assets over the next four years that total approximately $224,321.

14. RELATED-PARTY TRANSACTIONS

An entity controlled by a director of the Company provides ongoing real estate 
advisory services to the Company. The fees charged for such services for the 
nine months ended September 30, 2012 were $24 (year ended December 31, 2011 - 
$90), as measured at the exchange amount.

In November 2010, the Company lent a senior officer $2,500 to purchase common 
shares of the Company on the Toronto Stock Exchange. The loan is on a 
non-recourse basis and is secured by the common shares acquired with the loan 
proceeds. It is for a term of five years and bears interest at 3.375 percent 
per annum, payable annually. The market value of the shares that secure the 
loan was approximately $2,002 as at September 30, 2012 (December 31, 2011 - 
$2,411). In accordance with applicable accounting standards regarding share 
purchase loans receivable, this loan is classified as a reduction of 
shareholders' equity due to its non-recourse nature. In addition, the shares 
purchased with the loan proceeds are considered to be, in substance, stock 
options.

The Company leases certain premises from an entity controlled by a director of 
the Company. The rent charged for these premises for the nine months ended 
September 30, 2012 was $267 (year ended December 31, 2011 - $312), as measured 
at the exchange amount.

15. PRESENTATION OF EXPENSES

The Company presents its expenses on the consolidated statements of operations 
using the function-of-expense method whereby expenses are classified according 
to their function within the Company. This method was selected as it is more 
closely aligned with the Company's business structure. The Company's functions 
under IFRS are as follows:
    --  operations; and
    --  selling, general and administrative.

Cost of sales includes direct operating costs (including product costs, direct 
labour and overhead costs) and depreciation on assets relating to operations.

Additional information on the nature of expenses is as follows:

Nine Months Ended September 30,                          2012    2011

(C$000s)                                                  ($)     ($)

Product costs                                         374,947 269,359

Depreciation                                           66,747  64,461

Amortization of debt issuance costs and debt discount     922     889

Employee benefits expense (note 16)                   268,382 220,332
                                                               

16. EMPLOYEE BENEFITS EXPENSE

Employee benefits include all forms of consideration given by the Company in 
exchange for services rendered by employees.

Nine Months Ended September 30,                       2012    2011

(C$000s)                                               ($)     ($)

Salaries and short-term employee benefits          253,415 210,254

Post-employment benefits (group retirement savings   2,499   2,072
plan)

Share-based payments                                10,901   7,720

Termination benefits                                 1,567     286
                                                   268,382 220,332
                                                            

17. CONTINGENCIES

Greek Litigation

As a result of the acquisition and amalgamation with Denison in 2004, the 
Company assumed certain legal obligations relating to Denison's Greek 
operations.

In 1998, North Aegean Petroleum Company E.P.E. ("NAPC"), a Greek subsidiary of 
a consortium in which Denison participated (and which is now a majority-owned 
subsidiary of the Company), terminated employees in Greece as a result of the 
cessation of its oil and natural gas operations in that country. Several 
groups of former employees filed claims against NAPC and the consortium 
alleging that their termination was invalid and that their severance pay was 
improperly determined.

In 1999, the largest group of plaintiffs received a ruling from the Athens 
Court of First Instance that their termination was invalid and that salaries 
in arrears amounting to approximately $8,649 (6,846 euros) plus interest were 
due to the former employees. This decision was appealed to the Athens Court of 
Appeal, which allowed the appeal in 2001 and annulled the above-mentioned 
decision of the Athens Court of First Instance. The said group of former 
employees filed an appeal with the Supreme Court of Greece, which was heard on 
May 29, 2007. The Supreme Court of Greece allowed the appeal and sent the 
matter back to the Athens Court of Appeal for the consideration of the quantum 
of awardable salaries in arrears. On June 3, 2008, the Athens Court of Appeal 
rejected NAPC's appeal and reinstated the award of the Athens Court of First 
Instance, which decision was further appealed to the Supreme Court of Greece. 
The matter was heard on April 20, 2010 and a decision rejecting such appeal 
was rendered in June 2010. NAPC and the Company are assessing available rights 
of appeal to any other levels of court in any jurisdiction where such an 
appeal is warranted.

Several other smaller groups of former employees have filed similar cases in 
various courts in Greece. One of these cases was heard by the Athens Court of 
First Instance on January 18, 2007. By judgment rendered November 23, 2007, 
the plaintiff's allegations were partially accepted, and the plaintiff was 
awarded compensation for additional work of approximately $44 (35 euros), plus 
interest. The appeal of this decision was heard on June 2, 2009, at which time 
an additional claim by the plaintiff was also heard. A decision in respect of 
the hearing has been rendered which accepted NAPC's appeal of the initial 
claim and partially accepted the additional claim of the plaintiff, resulting 
in an award of approximately $14 (11 euros), plus interest.

Another one of the lawsuits seeking salaries in arrears of $162 (128 euros) 
plus interest, was heard by the Supreme Court of Greece on November 6, 2007, 
at which date the appeal of the plaintiffs was denied for technical reasons 
due to improper service. A rehearing of this appeal was heard on September 21, 
2010 and the decision rendered declared once again the appeal inadmissible due 
to technical reasons. The remaining action, which is seeking salaries in 
arrears of approximately $555 (439 euros) plus interest, was scheduled to be 
heard before the Athens Court of First Instance on October 1, 2009, but was 
adjourned until November 18, 2011 as a result of the Greek elections. On 
November 18, 2011 the hearing of this claim was again postponed until May 24, 
2012, on which date it was further postponed until February 22, 2013

The maximum aggregate interest payable under the claims noted above amounted 
to $14,543 (11,511 euros) as at September 30, 2012.

The previously disclosed agreement with a Greek exploration and production 
company pursuant to which the Company had agreed to assign approximately 90 
percent of its entitlement under an offshore licence agreement for 
consideration including a full indemnity in respect of the Greek legal claims 
described above has expired in accordance with its terms. Notwithstanding such 
expiry, the Greek exploration and production company continues to work towards 
the satisfaction of the conditions precedent in the expired agreement in order 
to facilitate a closing.

Management is of the view that it is improbable there will be an outflow of 
economic resources from the Company to settle these claims. Consequently, no 
provision has been recorded in these interim consolidated financial statements.

U.S. Litigation

A collective and class action claim was filed against the Company on September 
27, 2012 in the United States District Court for the Western District of 
Pennsylvania. The direction and financial consequences of the complaint cannot 
be determined at this time and consequently, no provision has been recorded in 
the Company's financial statements.

18. SEGMENTED INFORMATION

The Company's activities are conducted in four geographic segments: Canada, 
the United States, Russia and Latin America. All activities are related to 
hydraulic fracturing, coiled tubing, cementing and other well completion 
services for the oil and natural gas industry.

The business segments presented reflect the Company's management structure and 
the way its management reviews business performance. The Company evaluates the 
performance of its operating segments primarily based on operating income, as 
defined below.
                         United           Latin                       
                 Canada  States  Russia America Corporate Consolidated

(C$000s)            ($)     ($)     ($)     ($)       ($)          ($)

Three Months Ended September
30, 2012                                                              

Revenue         200,763 158,473  31,228  27,378         -      417,842

Operating
income (loss)(
(1))             56,371  22,674   3,495   1,990  (13,926)       70,604

Segmented
assets          727,781 590,146 123,185  91,436         -    1,532,548

Capital
expenditures     22,184  39,256   1,610     912         -       63,962

Goodwill          7,236   2,308     979       -         -       10,523

Three Months Ended
September 30, 2011                                                    

Revenue         230,011 165,114  29,233  16,133         -      440,491

Operating
income (loss)(
(1))             87,203  46,291   3,345   (416)   (9,896)      126,527

Segmented
assets          662,917 503,107 123,869  43,533         -    1,333,426

Capital
expenditures     43,088  38,179   2,864     999         -       85,130

Goodwill          7,236   2,308     979       -         -       10,523

Nine Months Ended
September 30, 2012                                                    

Revenue         531,306 528,508  88,569  79,346         -    1,227,729

Operating
income (loss)(
(1))            139,533  99,641   6,820   5,738  (37,937)      213,795

Segmented
assets          727,781 590,146 123,185  91,436         -    1,532,548

Capital
expenditures    102,686 111,978   3,719   4,940         -      223,323

Goodwill          7,236   2,308     979       -         -       10,523

Nine Months Ended
September 30, 2011                                                    

Revenue         518,047 405,220  85,367  38,721         -    1,047,355

Operating
income (loss)(
(1))            160,141 123,917   8,924 (1,393)  (29,125)      262,464

Segmented
assets          662,917 503,107 123,869  43,533         -    1,333,426

Capital
expenditures    104,045 109,949   7,461   1,499         -      222,954

Goodwill          7,236   2,308     979       -         -       10,523
                                                           

((1))      Operating income (loss) is defined as net income (loss)
           before depreciation, interest, foreign exchange gains or
           losses, gain or loss on disposal of property, plant and
           equipment, and income taxes or recoveries. Operating income
           was calculated as follows:
                       
                      Three Months Ended Sept. Nine Months Ended Sept.
                      30,                                          30,
                        2012              2011    2012            2011

(C$000s)                                                              

Net income            26,655            47,285  85,380         108,299

Add back (deduct):                                                    
      Depreciation    22,406            21,897  66,747          64,461
      Interest         9,504             8,739  27,421          26,436


  Foreign          (358)            23,720 (4,442)          13,244
exchange (gains)
losses 
  Loss (gain) on                                                  
disposal of property,
plant and 
        equipment     88               765     632           (316) 
  Income taxes    12,309            24,121  38,057          50,340 
Operating income      70,604           126,527 213,795         262,464 


                                                        

Operating income does not have any standardized meaning under IFRS and may not 
be comparable to similar measures used by other companies.

The following table sets forth consolidated revenue by service line:
              Three Months Ended Sept. 30, Nine Months Ended Sept. 30,
                 2012                 2011      2012              2011

(C$000s)                                                              

Fracturing    376,030              405,747 1,104,690           957,307

Coiled tubing  28,579               25,548    80,577            68,143

Cementing       7,865                5,980    24,568            14,161

Other           5,368                3,216    17,894             7,744
              417,842              440,491 1,227,729         1,047,355
                                                      

19. SEASONALITY OF OPERATIONS

The Company's Canadian business is seasonal. The lowest activity is typically 
experienced during the second quarter of the year when road weight 
restrictions are in place and access to wellsites in Canada is reduced.

20. DIVIDEND REINVESTMENT PLAN

The Company has a Dividend Reinvestment Plan (DRIP) that allows shareholders 
to direct cash dividends paid on all or a portion of their common shares to be 
reinvested in additional common shares that are issued at 95 percent of the 
volume-weighted average price of the common shares traded on the Toronto Stock 
Exchange during the last five trading days preceding the relevant dividend 
payment date.

A dividend of $0.10 per common share was declared on December 8, 2011 and paid 
on January 31, 2012. Of the total dividend in the amount of $4,376, $1,771 was 
reinvested under the DRIP into 71,189 common shares of the Company.

A dividend of $0.50 per common share was declared on June 15, 2012 and paid on 
July 16, 2012. Of the total dividend in the amount of $22,182, $6,083 was 
reinvested under the DRIP into 298,459 common shares of the Company.











Douglas R. Ramsay Chief Executive Officer Telephone: 403-266-6000 Fax: 
403-266-7381

Laura A. Cillis Senior Vice President, Finance and Chief Financial Officer 
Telephone: 403-266-6000 Fax: 403-266-7381

Tom J. Medvedic Senior Vice President, Corporate Development Telephone: 
403-266-6000 Fax: 403-266-7381

SOURCE: Calfrac Well Services Ltd.

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CO: Calfrac Well Services Ltd.
ST: Alberta
NI: OIL ERN CONF 

-0- Nov/07/2012 11:00 GMT