Trinidad Drilling Ltd. Reports Solid Third Quarter 2012 Results; Industry-leading Activity Levels, Stable Adjusted EBITDA

Trinidad Drilling Ltd. Reports Solid Third Quarter 2012 Results; 
Industry-leading Activity Levels, Stable Adjusted EBITDA 
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION 
IN THE UNITED STATES/ 
TSX SYMBOL: TDG 
CALGARY, Nov. 7, 2012 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or "the 
Company") reported solid third quarter and year-to-date 2012 results. 
Trinidad's adjusted EBITDA ((1)) in the third quarter was in line with the 
same quarter last year and above the levels recorded in the second quarter of 
2012. Year to date, adjusted EBITDA grew in the first nine months of 2012 when 
compared to the prior year. Trinidad's solid third quarter and year-to-date 
2012 performance was a result of higher dayrates driven by strong demand 
present in the second half of 2011 and first half of 2012, partially offset by 
the impact of softening industry conditions in the third quarter. 
"While we have seen a weakening in market conditions from the strength we saw 
in the first half of 2012, commodity prices still remain at levels that drive 
steady activity in the drilling industry," said Lyle Whitmarsh, Trinidad's 
Chief Executive Officer. "Our third quarter results demonstrate the strength 
of our business model and although we are not immune to the overall market 
conditions, our modern, high tech equipment, solid contract base and growing 
financial flexibility position us well to continue to outperform the industry 
as a whole." 
((1)) Please see the Non-GAAP Measures Definitions section of this document 
for further details. 
FINANCIAL HIGHLIGHTS 
           Three months ended September  Nine months ended September 30, 
                        30, 
($ thousands
except share         2012        2011      %        2012        2011       %
and per                               Change                          Change
share data) 
Revenue (3)       207,716     196,790    5.6     630,864     570,774    10.5 
Revenue, net
of third          194,790     184,107    5.8     589,817     527,905    11.7
party costs 
Gross margin       79,895      81,486  (2.0)     249,872     218,853    14.2
(1) 
Gross margin
percentage          38.5%       41.4%  (7.0)       39.6%       38.3%     3.4
(1, 3) 
Gross margin
- net               41.0%       44.3%  (7.4)       42.4%       41.5%     2.2
percentage
(1) 
EBITDA (1)         64,714      76,017 (14.9)     209,035     180,994    15.5 
Per share
  (diluted)          0.54        0.63 (14.3)        1.73        1.50    15.3
  (2) 
Adjusted           68,387      69,383  (1.4)     213,682     178,075    20.0
EBITDA (1) 
Per share
  (diluted)          0.57        0.57      -        1.77        1.47    20.4
  (2) 
Cash
provided by        19,743      33,654 (41.3)     183,344     140,234    30.7
operations 
Per share
  (basic /           0.16        0.28 (42.9)        1.52        1.16    31.0
  diluted)
  (2) 
Funds
provided by        51,659      44,936   15.0     174,324     144,155    20.9
operations 
Per share
  (basic /           0.43        0.37   16.2        1.44        1.19    21.0
  diluted)
  (2) 
Net earnings       19,950      30,169 (33.9)      67,284      51,163    31.5 
Per share
  (basic /           0.17        0.25 (32.0)        0.56        0.42    33.3
  diluted)
  (2) 
Adjusted net       24,913      23,535    5.9      80,740      57,237    41.1
earnings (1) 
Per share
  (basic /           0.21        0.19   10.5        0.67        0.47    42.6
  diluted)
  (2) 
Capital
expenditures       39,428      36,902    6.8     146,436      72,216   102.8
net of
dispositions 
Dividends           6,043       6,043      -      18,129      18,129       -
declared 
Shares
outstanding                                                                 
- basic /
diluted 
(weighted                                                         
  average)    120,859,476 120,859,109      - 120,859,476 120,853,781       -
  (2) 
                                                                   
As at                                          September    December         
                                                 30,         31, 
($ thousands
except                                              2012        2011       %
percentage                                                           Change 
data) 
Total assets                                   1,611,220   1,608,126     0.2 
Total
long-term                                        634,568     666,717   (4.8)
liabilities 


                                                                       

(1)      Readers are cautioned that Gross margin, Gross
         margin percentage, Gross margin - net percentage,
         EBITDA, Adjusted EBITDA, Adjusted net earnings and
         the related per share information do not have
         standardized meanings prescribed by IFRS - see
         "Non-GAAP Measures".

(2)      Basic shares include the weighted average number of
         shares outstanding over the period.  Diluted shares
         include the weighted average number of shares
         outstanding over the period and the dilutive impact,
         if any, the number of shares issuable pursuant to
         the Incentive Option Plan.

(3)      Revenue has been recalculated in the prior year
         based on changes in presentation - see "Change in
         Presentation".

OPERATING HIGHLIGHTS
                                                        
                   Three months ended    Nine months ended September
                     September 30,                   30,
                  2012   2011 % Change     2012   2011      % Change

Land Drilling                                                       
Market 

Operating days                                                      
(1, 2)
    Canada        3,233  3,675   (12.0)    8,628  9,680        (10.9)


United
  States and     5,038  5,579    (9.7)   15,589 15,837         (1.6)
  International 
Rate per
operating day                                                       
(1, 3, 4) 
Canada       23,501 20,315     15.7   24,112 20,462          17.8
  (CDN$) 
United
  States and    22,518 18,600     21.1   22,344 18,304          22.1
  International
  (CDN$) 
United
  States and    22,263 19,143     16.3   22,192 18,721          18.5
  International
  (US$) 
Utilization
rate -                                                              
operating day
(1, 3, 5) 
Canada          62%    74%   (16.2)      57%    64%        (10.9) 
United
  States and       81%    92%   (12.0)      85%    90%         (5.6)
  International 
Number of
drilling rigs                                                       
at quarter end 
Canada           57     54      5.6       57     54           5.6 
United
  States and        68     66      3.0       68     66           3.0
  International 
Utilization
  rate for           -      -        -        -    51%             -
  service rigs
  (6) 
Number of
  coring and                                                        
  surface
  casing rigs 
at quarter        20     20        -       20     20             -
  end 
Barge Drilling                                                      
Market  
Operating       376    454   (17.2)    1,169  1,335        (12.4)
  days (1, 2) 
Rate per
  operating day 30,008 24,833     20.8   28,244 23,187          21.8
  (CDN$) (1, 3,
  4) 
Rate per
  operating day 29,583 25,547     15.8   28,044 23,705          18.3
  (US$) (1, 3,
  4) 
Utilization
  rate -           82%    99%   (17.2)      85%    98%        (13.3)
  operating day
  (1, 5) 
Number of
  barge
  drilling rigs      2      2        -        2      2             -
  at quarter
  end 
Number of barge
  drilling rigs under                                               
  Bareboat 
Charter
  Agreements at      3      3        -        3      3             -
  quarter end 
(1)      Operating days, utilization rate - operating day and rate per 
     operating day have been recalculated, see "Change in 
     Presentation". 
(2)      Operating days include drill days and move days. 
(3)      Rate per operating day includes operating revenue divided by 
     operating days. 
(4)      Operating revenue is presented net of third party costs. 
(5)      Utilization rate - operating day is based on operating days 
     divided by total days available. 
(6)      In the second quarter of 2011, Trinidad disposed of its 22 


         well servicing rigs and related equipment.

OVERVIEW

Trinidad recorded solid results in the third quarter of 2012; however, 
stronger revenue levels driven by higher dayrates were offset by lower 
operating days and higher repairs and maintenance expenses, leaving adjusted 
EBIDTA largely in line with the same quarter last year. Record performance in 
the first two quarters of 2012 drove higher revenue, gross margin and adjusted 
EBITDA in Trinidad's year-to-date results compared to the same period last 
year.

Net earnings in the quarter lowered from the same quarter last year largely as 
a result of higher share-based compensation, an impairment recorded on 
property and equipment and the absence of a foreign exchange gain, partially 
offset by lower income taxes. Year to date, net earnings increased due to 
higher adjusted EBITDA partially offset by the absence of gains on foreign 
exchange and the sale of assets and higher income taxes.

Third quarter revenue, adjusted EBIDTA and net earnings were higher than the 
second quarter of 2012 largely due to the end of spring break-up in Canada and 
added contributions from this segment as rigs went back to work.

During the third quarter of 2012, crude oil prices weakened as ongoing 
concerns around European debt levels and slow global economic recovery put 
downward pressure on oil prices. On average during the quarter, crude oil 
prices remained at healthy levels; however, a drop below US$80 per barrel in 
late June caused a pullback in oil and gas development across North America as 
oil and gas producers chose to delay capital spending and take a cautious 
approach to their drilling programs. The strong movement away from natural gas 
drilling over the past few years has begun to have an impact on supply levels 
and the level of natural gas in storage has begun to drop towards more normal 
levels. This improvement in pricing is positive; however, natural gas prices 
still remain below the level that drives strong development activity for 
natural gas plays.

INDUSTRY STATISTICS
                                                                 
                        2012                        2011           2010
               Q3      Q2     Q1      Q4      Q3     Q2      Q1      Q4

Commodity                                                              
Prices

WTI crude
oil price           93.30          94.02   89.49          94.07   85.16
(US$ per    92.15         102.99                 102.02
barrel)

Henry Hub
natural gas  2.88    2.29   2.43    3.33    4.12   4.37    4.18    3.80
price (US$
per mmBtu)
                                                                       

US Industry                                                            
Activity

Average US
industry         
active land 1,837   1,902  1,929   1,954   1,893  1,778   1,674   1,648
rig count
(1)

Average
Trinidad
active land    55      58     58      60      61     57      57      54
rig count
(2)
                                                                       

Canadian
Industry                                                               
Activity

Average
Canadian
industry      42%     18%    65%     54%     54%    23%     66%     49%
utilization
(3)

Average
Trinidad      58%     24%    77%     69%     69%    31%     80%     65%
utilization
(4)

1)       Baker Hughes rig counts (information obtained from Tudor
         Pickering Holt & Company weekly rig roundup report).

(2)      Includes US and international rigs, excludes rigs that are
         idle but contracted.

(3)      Canadian Association of Oilwell drilling Contractors (CAODC)
         utilization.

(4)      Based on drilling days (spud to rig release dates), excludes
         rigs that are idle but contracted.

During the third quarter, industry activity levels reflected the softening 
demand as the number of active rigs in the US dropped slightly and utilization 
levels in Canada were slower to ramp up after spring break-up. While Trinidad 
was impacted by these industry conditions, the Company's modern, high 
performance equipment and strong contract position allowed it to continue to 
outperform the industry average activity levels.

Trinidad's dayrates in the third quarter and year to date in 2012 increased 
from the levels recorded in the same periods last year driven by stronger 
demand across North America year over year. When compared to the second 
quarter of 2012, dayrates decreased as market conditions softened in the third 
quarter, combined with a shift in the Company's active rig mix after spring 
break-up.

Trinidad remains committed to its leverage reduction strategy and further 
reduced its Total Debt to EBITDA ratio in the third quarter to 1.96 times. In 
order to meet its debt reduction targets, Trinidad has carefully managed its 
cost structure and its capital spending program by selecting projects that 
allow the Company to grow its business and continue as an industry leader, 
while also reducing its debt balances. Trinidad is moving towards its 
long-term leverage goal of Total Debt to EBIDTA of 1.50 times.

Third quarter 2012 and year-to-date highlights
    --  Trinidad generated revenue of $207.7 million for the third
        quarter and $630.9 million year to date, an increase of 5.6%
        and 10.5% from the same periods of 2011. Revenue grew in the
        quarter and year to date as a result of higher dayrates in each
        of the Canadian and the US and international operations and an
        increased fleet size. These factors were partially offset by a
        reduction in operating days in 2012 due to softening market
        conditions in the third quarter.
    --  Gross margin - net percentage was 41.0% in the quarter and
        42.4% year to date, compared to 44.3% and 41.5%, respectively,
        in 2011. Gross margin - net percentage decreased from the same
        quarter last year due to higher repairs and maintenance
        expenses incurred in the US and international division. Higher
        year-to-date gross margin - net percentage levels were largely
        driven by strong results in the first two quarters of 2012
        compared to the first nine months of 2011.
    --  Adjusted EBITDA was $68.4 million in the third quarter and
        $213.7 million year to date, down 1.4% and up 20.0%,
        respectively, from the same periods of 2011. Adjusted EBITDA
        was largely in line with the same quarter last year as the
        impact of higher dayrates and an increased fleet size was
        offset by lower operating days and higher operating costs. Year
        to date, adjusted EBITDA increased as a result of higher gross
        margin in the first nine months of 2012 and lower general and
        administrative costs (excluding share-based payments) compared
        to the same period in the prior year.
    --  Net earnings were $20.0 million ($0.17 per share (diluted)) for
        the quarter and $67.3 million ($0.56 per share (diluted)) year
        to date, down 33.9% and up 31.5%, respectively from the
        comparative periods in 2011. Net earnings lowered quarter over
        quarter as a result of higher share-based compensation, the
        absence of a foreign exchange gain and an impairment of
        property and equipment recorded in the quarter, partially
        offset by lower income taxes. Year to date, net earnings
        increased due to higher adjusted EBITDA partially offset by the
        absence of gains relating to foreign exchange and asset sales
        and higher income taxes.
    --  In the third quarter of 2012, Trinidad maintained its lower
        leverage level and recorded Total Debt to EBITDA of 1.96 times,
        compared to 2.42 times at year-end 2011 and 2.56 times at the
        end of the third quarter of 2011. Trinidad remains committed to
        lowering its leverage with a long-term target of 1.50 times.
    --  During the quarter, Trinidad added two newly built rigs to its
        Canadian operations, both under five-year, take-or-pay
        contracts.

RESULTS FROM OPERATIONS

Canadian Operations
                                                        
                 Three months ended    Nine months ended September
                   September 30,                   30,

($ thousands
except
percentage      2012   2011 % Change      2012    2011    % Change
and operating
data)

Operating
revenue (1,   77,155 74,598      3.4   225,923 221,685         1.9
2, 3, 4)

Other revenue     51    107   (52.3)       293     691      (57.6)
              77,206 74,705      3.3   226,216 222,376         1.7

Operating
costs (1, 2,  43,276 42,992      0.7   129,802 134,236       (3.3)
3, 4)

Gross margin  33,930 31,713      7.0    96,414  88,140         9.4

Gross margin
- net          43.9%  42.5%      3.3     42.6%   39.6%         7.6
percentage
                                                                  

Drilling days  3,004  3,434   (12.5)     7,969   8,964      (11.1)

Operating      3,233  3,675   (12.0)     8,628   9,680      (10.9)
days (1, 5)

Rate per
operating day 23,501 20,315     15.7    24,112  20,462        17.8
(CDN$) (1, 6)

Utilization
rate -           62%    74%   (16.2)       57%     64%      (10.9)
operating day
(1, 7)

Utilization
rate -           58%    69%   (15.9)       53%     59%      (10.2)
drilling day
(1, 8)

CAODC
industry         42%    54%   (22.2)       41%     47%      (12.8)
average (1,
9)

Number of
drilling rigs     57     54      5.6        57      54         5.6
at quarter
end
                                                                  

 Utilization
rate for           -      -        -         -     51%           -
service rigs
(1, 10)

 Number of
coring and                                                        
surface rigs

  at quarter      20     20        -        20      20           -
end 

(1)       Operating revenue, operating costs, operating days,
          utilization rate - operating day and rate per operating day
          have been recalculated, see "Change in Presentation".

(2)       Inter-segment revenue and operating costs of $4.6 million and
          $16.7 million has been excluded for the three months ended
          September 30, 2012 and 2011, respectively.  Inter-segment
          revenue and operating costs of $9.5 million and $42.9 million
          has been excluded for the nine months ended September 30,
          2012 and 2011, respectively. Each of these inter-segment
          revenue and operating costs relates to rig construction for
          the US operations.

(3)       External construction revenue and operating costs of less
          than $0.1 million and $0.2 million for the three and nine
          months ended September 30, 2012, respectively, are included
          in the above table. External construction revenue and
          operating costs of less than $0.1 million and $1.1 million
          for the three and nine months ended September 30, 2011, are
          included in the above table.

(4)       Operating revenue and operating costs exclude third party
          recovery and third party costs of $8.7 million and $9.4
          million for the three month period ended September 30, 2012
          and 2011, respectively. Operating revenue and operating costs
          exclude third party recovery and third party costs of $27.7
          million and $30.9 million have been excluded for the nine
          month period ended September 30, 2012 and 2011, respectively.

(5)       Operating days include drill days and move days.

(6)       Rate per operating day includes operating revenue divided by
          operating days.

(7)       Utilization rate - operating day is based on operating days
          divided by total days available.

(8)       Utilization rate - drilling day is based on drilling days
          divided by total days available.

(9)       CAODC industry average is based on drilling days divided by
          total days available.

(10)      In the second quarter of 2011, Trinidad disposed of all of
          its 22 well servicing rigs and related equipment.

Trinidad's Canadian operations performed strongly in the third quarter and 
year-to-date 2012, which was reflected in higher revenues and improved gross 
margins compared to the same periods of the prior year. The strong performance 
was driven by higher dayrates carried over from the first half of 2012, which 
more than offset the lower activity levels in the current period. In addition, 
the increased rig count more than compensated for the impact of the sale of 
the Company's well service rigs in the second quarter of 2011.

When compared to the second quarter of 2012, Canadian operations generated 
higher revenue and gross margin - net percentage as a result of the 
seasonality present in the Canadian drilling industry.

The third quarter is typically representative of higher activity levels as 
spring break up is complete and road bans are lifted, allowing drilling to 
resume. Trinidad's high performance, modern fleet has consistently 
outperformed industry activity levels, with this trend continuing into the 
third quarter of 2012. During the quarter, Trinidad recorded average 
utilization that was 16 percentage points higher than the industry, strongly 
demonstrating the ongoing demand for the Company's equipment.

A slower than expected increase in activity following spring break-up led to 
lower industry activity levels versus the same period of the prior year. Low 
natural gas prices and weakening crude oil prices caused a number of oil and 
gas producers to take a cautious approach to their remaining 2012 drilling 
programs. For Trinidad, the effect of this shift in the industry had a muted 
impact due to continued strong demand for Trinidad's higher specification 
rigs, as well as the Company's focus toward long-term, take-or-pay contracts.

Dayrates increased in the third quarter of 2012 compared to the same period of 
2011. Improved pricing was largely the result of high customer demand carried 
over from the first half of 2012, reflecting stronger market conditions year 
over year. The full impact of the higher dayrates was not reflected in the 
gross margin - net percentage as a portion of the increase was the result of 
higher crew wages from the fourth quarter of 2011; these costs are passed on 
to the operator at cost. In addition, in the current quarter and year to date, 
dayrates were higher by $432 per operating day and $483 per operating day, 
respectively, related to standby revenues. Standby revenues generate income 
but are not considered as operating days; therefore, increasing dayrates.

When compared to the second quarter of 2012, dayrates decreased as a result of 
the change in the active rig mix as rigs returned to work following spring 
break-up.

Gross margins in the current period and year-to-date 2012 were higher than the 
same periods of the prior year due to a higher rig count, increased dayrates 
carried over from the first half of 2012, as well as the Company's continued 
focus on cost containment. The positive margin impacts were slightly offset by 
the absence of the well servicing assets in the current periods, and the 
impact of lower operating days. These factors also drove higher gross margin - 
net percentages in both the current quarter and year-to-date 2012, compared to 
the same periods in 2011. Gross margin and gross margin - net percentage have 
increased when compared to the second quarter of 2012 due to the end of spring 
break-up and the return to normalized activity levels.

Trinidad's active rig fleet increased by three rigs in the current period 
versus the same period of 2011, as one new build was delivered from the 
Company's manufacturing division in the second quarter of 2012, and two new 
builds were added to the fleet during the third quarter of 2012.

By comparison, in the first three quarters of 2011, the construction 
operations delivered one rig per quarter into the US operations. In 
addition, they continued construction on the two new builds that were added in 
early 2012.

In the third quarter of 2012, the construction operations continued work on 
Trinidad's four remaining new builds. The Company expects two rigs to be 
delivered in the fourth quarter of 2012, with the remaining two rigs delivered 
in the first half of 2013.

United States and International Operations
                                                             
             Three months ended September   Nine months ended September
                         30,                            30,

($ thousands
except
percentage      2012    2011     % Change      2012    2011    % Change
and
operating
data)

Operating
revenue (1,  117,825 109,364          7.7   363,828 305,188        19.2
2)

Other          (241)      38      (734.2)     (227)     341     (166.6)
revenue
             117,584 109,402          7.5   363,601 305,529        19.0

Operating     71,619  59,629         20.1   210,143 174,816        20.2
costs (1, 2)

Gross margin  45,965  49,773        (7.7)   153,458 130,713        17.4

Gross margin
- net          39.1%   45.5%                  42.2%   42.8%            
percentage
                                                                       

 Land
Drilling                                                               
Rigs 

Drilling       4,355   4,957       (12.1)    13,495  14,237       (5.2)
days

Operating      5,038   5,579        (9.7)    15,589  15,837       (1.6)
days (1 ,3)

Rate per
operating     22,518  18,600         21.1    22,344  18,304        22.1
day (CDN$)
(1, 4)

Rate per
operating     22,263  19,143         16.3    22,192  18,721        18.5
day (US$)
(1, 4)

Utilization
rate -           81%     92%       (12.0)       85%     90%       (5.6)
operating
day (1, 5)

Utilization
rate -           70%     82%       (14.6)       74%     81%       (8.6)
drilling day
(1, 6)

Number of
drilling          68      66          3.0        68      66         3.0
rigs at
quarter end
                                                                       

 Barge
Drilling                                                               
Rigs 

Operating        376     454       (17.2)     1,169   1,335      (12.4)
days (3)

 Rate per
operating     30,008  24,833         20.8    28,244  23,187        21.8
day (CDN$)
(1, 4)

 Rate per
operating     29,583  25,547         15.8    28,044  23,705        18.3
day (US$)
(1, 4)

Utilization
rate -           82%     99%       (17.2)       85%     98%      (13.3)
operating
day (1, 5)

 Number of
barge
drilling           2       2            -         2       2           -
rigs at
quarter end 

 Number of
barge                                                                  
drilling
rigs under 

Bareboat
Charter
Agreements         3       3            -         3       3           -
at quarter
end 
                                                                       

(1)      Operating revenue, operating costs, operating days,
         utilization rate - operating day and rate per operating day
         have been recalculated, see "Change in Presentation".

(2)      Operating revenue and operating costs exclude third party
         recovery and third party costs of $4.2 million and $3.3
         million for the three months ended September 30, 2012 and
         2011, respectively; and $13.3 million and $12.0 million for
         the nine months ended September 30, 2012 and 2011,
         respectively.

(3)      Operating days include drill days and move days.

(4)      Rate per operating day includes operating revenue divided by
         operating days.

(5)      Utilization rate - operating day is based on operating days
         divided by total days available.

(6)      Utilization rate - drilling day is based on drilling days
         divided by total days available.

Market conditions remained strong in the first half of 2012 in Trinidad's US 
and international operations when compared to the same period of the prior 
year; however, softening market conditions led to reduced industry activity 
levels in the current quarter. While the shift in industry demand reduced 
Trinidad's activity in the third quarter, it had a muted impact on the 
Company's operations due to Trinidad's continued focus towards in-demand, 
higher specification equipment, combined with the its high concentration of 
long-term, take-or-pay contracts.

Strong industry demand for Trinidad's modern, high performance equipment led 
to upward momentum on dayrates in the first half of the current year with 
dayrates in the third quarter and year-to-date of 2012 showing improvement 
over the same periods of the prior year. The full impact of these dayrate 
increases was not reflected in the gross margin - net percentage as a portion 
of the increase was related to higher crew wages, which are passed onto the 
operator at cost. In addition, in the current quarter and year to date, the 
Company recorded higher standby revenue versus the same periods of the prior 
year, which increased dayrates as revenue is incurred with no associated 
operating days. Overall, dayrates on a per-rig basis did not change versus the 
second quarter, while the average fleet dayrate was marginally impacted by 
lower standby revenue in the current period, partially offset by a shift in 
rig mix towards higher specification equipment. In the current quarter and 
year to date in 2012, dayrates were higher by US$778 per operating day and 
US$1,030 per operating day, respectively, related to standby revenues.

Although revenues remained strong, the gross margin and gross margin - net 
percentage levels showed a decline in the third quarter when compared to the 
prior year and prior quarter. Gross margins decreased largely due to higher 
operating costs in the current period as the Company took the opportunity to 
complete maintenance work on equipment during this period of lower activity, 
which had not been possible in prior periods. In addition, Trinidad is 
adapting to a shift in customer activity among plays, which has had a slightly 
negative impact on margins due to shorter well drilling times and more move 
days. Lastly, in the first half of 2011, Trinidad received one-time 
demobilization revenue that positively impacted the gross margin. Trinidad 
does not count standby and demobilization in the operating day statistics, 
which increases dayrates.

Utilization levels in the third quarter and year-to-date 2012 lowered from the 
levels experienced in 2011, as well as the first and second quarters of 2012. 
During the third quarter, Trinidad experienced a decrease in operating days 
for its spot market equipment as a result of the current uncertainty in 
relation to commodity prices. In addition, in the current periods there was an 
increase of rigs under standby versus the same periods of the prior year which 
reduced utilization levels in the current period.

Trinidad's land drilling rig count increased by two rigs on a net basis as at 
September 30, 2012, when compared to the same period of 2011. Four rigs were 
delivered into the US operations in the first half of 2012; each of these rigs 
were purchased externally and retrofitted to meet the Company's 
specifications. Additionally, two rigs were removed from the Company's 
marketable fleet at year-end 2011. These two rigs are being assessed for 
sale or possible retrofit to meet current customer demands and Trinidad's 
target fleet mix. All four rigs delivered into service in 2012 were delivered 
into the Niobrara shale area in Wyoming.

The Company's barge drilling operations continued to perform well, with 
quarter-over-quarter as well as year-over-year dayrate increases. Higher 
dayrates for these operations are a reflection of the solid demand and limited 
supply of high quality equipment in this sector. However, operating days and 
utilization levels were negatively impacted during the current quarter due to 
logistical delays as a result of hurricane Isaac.

QUARTERLY ANALYSIS

FINANCIAL HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                  
                              2012                    2011         2010

($ millions except
per share data and     Q3    Q2     Q1    Q4     Q3    Q2    Q1     Q4 
operating data)

Revenue              207.7 167.6  255.6 226.5  196.8 149.7 224.3  194.4

Gross margin (1)      79.9  65.8  104.2  88.8   81.5  52.6  84.7   76.7

Gross margin         38.5% 39.3%  40.8% 39.2%  41.4% 35.2% 37.8%  39.4%
percentage (1)

Gross margin - net   41.0% 41.2%  44.3% 42.4%  44.3% 37.8% 41.4%  43.0%
percentage (1)
                                                                  

Net earnings (loss)   20.0  12.9   34.5  25.3   30.2   5.0  16.0 (84.8)
for the year

  Adjustments for:                                                     


Depreciation and   30.4  25.8   28.1  29.1   28.6  25.4  29.6   27.7
amortization  
Foreign             0.8 (0.7)    0.5   2.4  (6.1) (1.2)   1.8    0.5
exchange  
Loss (gain) on
sale of property         - (0.5)    0.2 (0.6)  (0.1) (5.3)     -    0.4
and equipment  
Impairment of
property and           1.3     -    7.5     -      -   9.0     -   24.9
equipment  
Impairment of
intangible assets        -     -      -     -      -     -     -   59.1
and goodwill  


    Finance costs      10.3  10.5   10.8  10.9   10.9  10.5  12.4   36.2
    Income taxes        2.7   4.4   10.2   4.8    6.4 (3.4)   5.9  (2.2)
    Other               2.9   1.0    0.1   2.5  (0.5) (0.9)   4.0    1.7


Income taxes      (1.1) (0.7)  (0.7)     -  (4.5) (0.9) (2.4)  (0.4)
paid  
Income taxes        3.9     -      -   0.8    1.5     -   0.2      -
recovered  
Interest paid    (19.5) (1.5) (19.8) (1.6) (21.4) (3.3) (3.1) (25.7) 
Interest              -     -      -     -      -     -     -      -
received  
Funds provided by     51.7  51.2   71.4  73.6   45.0  34.9  64.4   37.4
operations 
Net earnings (loss)   0.17  0.11   0.29  0.21   0.25  0.04  0.13 (0.70)
per share (diluted) 
Funds provided by
operations per        0.43  0.42   0.59  0.61   0.37  0.29  0.53   0.31
share (diluted) 
(1)      See the Non-GAAP Measures Definitions section of this document 


         for further details.

NON-GAAP MEASURES HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                 
                           2012                     2011          2010

 ($ millions
except per share  Q3     Q2     Q1     Q4     Q3     Q2     Q1     Q4 
data and
operating data) 

EBITDA (1)       64.7   53.1   91.2   69.5   76.0   41.2   63.8   61.5

  Per share      0.54   0.44   0.75   0.58   0.63   0.34   0.53   0.51
  (diluted) (2)

Adjusted EBITDA  68.4   53.3   92.0   74.4   69.4   39.1   69.6   63.7
(1)

  Per share      0.57   0.44   0.76   0.62   0.57   0.32   0.58   0.53
  (diluted) (2)

Adjusted net     24.9   13.1   42.7   30.2   23.5   11.9   21.8    1.5
earnings (1)

  Per share      0.21   0.11   0.35   0.25   0.19   0.10   0.18   0.01
  (diluted) (2)

(1)      See the Non-GAAP Measures Definitions section of this document
         for further details.

(2)      Diluted shares include the weighted average number of shares
         outstanding over the period and the dilutive impact, if any,
         the number of shares issuable pursuant to the Incentive Option
         Plan.

OPERATING HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                  
                           2012                      2011          2010
                   Q3     Q2     Q1     Q4     Q3     Q2     Q1     Q4 

Land Drilling                                                          
Market 

Operating days                                                         
(1, 2)
    Canada        3,233  1,288  4,107  3,665  3,675  1,646  4,359  3,522


United
  States and     5,038  5,289  5,262  5,547  5,579  5,170  5,088  4,958
  International 
Rate per
operating day                                                          
(1, 3, 4) 
Canada       23,501 25,343 24,206 23,652 20,315 20,796 20,459 20,163
  (CDN$) 
United
  States and    22,518 22,586 21,935 20,710 18,600 18,470 17,815 18,172
  International
  (CDN$) 
United
  States and    22,263 22,616 21,698 20,387 19,143 19,095 17,878 17,789
  International
  (US$) 
Utilization
rate -                                                                 
operating day
(1, 5) 
Canada          62%    26%    84%    74%    74%    34%    87%    70% 
United
  States and       81%    86%    90%    92%    92%    89%    90%    82%
  International 
Number of
drilling rigs                                                          
at quarter end 
Canada           57     55     54     54     54     54     55     55 
United
  States and        68     68     66     64     66     65     63     62
  International 
Utilization
  rate for           -      -      -      -      -    34%    66%    57%
  service rigs
  (6) 
Number of
  service rigs       -      -      -      -      -      -     22     22
  at quarter
  end (6) 
Number of
  coring and                                                           
  surface
  casing 
rigs at           20     20     20     20     20     20     20     20
  quarter end 
                                                                    
Barge Drilling                                                         
Market  
Operating       376    429    364    373    454    436    445    456
  days (1, 2) 
Rate per
  operating day 30,008 29,072 25,448 25,835 24,833 22,680 22,004 24,368
  (CDN$) (1, 3,
  4) 
Rate per
  operating day 29,583 29,106 25,204 25,455 25,547 23,441 22,083 23,844
  (US$) (1, 3,
  4) 
Utilization
  rate -           82%    94%    80%    81%    99%    96%    99%    99%
  operating day
  (1, 5) 
Number of
  barge
  drilling rigs      2      2      2      2      2      2      2      2
  at quarter
  end  
Number of
  barge                                                                
  drilling rigs
  under  
Bareboat
  Charter at         3      3      3      3      3      3      3      3
  quarter end  
(1)      Operating revenue, operating costs, operating days, 
     utilization rate - operating day and rate per operating day 
     have been recalculated, see "Change in Presentation". 
(2)      Operating days include drill days and move days. 
(3)      Rate per operating day includes operating revenue divided by 
     operating days. 
(4)      Operating revenue is presented net of third party costs. 
(5)      Utilization rate - operating day is based on operating days 
     divided by total days available. 
(6)      In the second quarter of 2011, Trinidad disposed of its 22 
     well servicing rigs and related equipment. 
FINANCIAL SUMMARY 
                                                           
As at                             September 30, December 31,            
($ thousands except percentage             2012         2011  $ Change 
data) 
Working capital (1)                     121,234      139,829   (18,595) 
                                                                    
Current portion of long-term debt           611          580         31 
Long-term debt (2)                      537,375      580,167   (42,792) 
Total debt                              537,986      580,747   (42,761) 
Total debt as a percentage of             33.4%        36.1%           
assets 
                                                                    
Total assets                          1,611,220    1,608,126      3,094 
Total long-term liabilities             634,568      666,717   (32,149) 
Total long-term liabilities as a          39.4%        41.5%           
percentage of assets 
                                                                    
Shareholders' equity                    879,211      841,226     37,985 
Total debt to shareholders'               61.2%        69.0%           
equity 
(1)See Non-GAAP Measures Definition section of this document for 
further details.
(2)Long-term debt is net of associated transaction costs. 
At September 30, 2012, working capital decreased by $18.6 million from 
December 31, 2011. The lower level of working capital was driven by a 
collection of receivables, lower inventory reflecting materials utilized for 
rig construction during the period, and an increase in deferred revenue 
related to delay and early termination penalty revenues received to be 
amortized over the remaining periods of the relevant contracts. These factors 
were partially offset by higher prepaid expenses, an increase in assets held 
for sale due to the classification of a building in the US operations, as well 
as a decrease in accounts payable and accruals due to timing of payables in 
the third quarter of 2012 compared to the fourth quarter of 2011. 
Trinidad's total debt balance declined by $42.8 million during the current 
quarter when compared to the year ended December 31, 2011. During this period, 
Trinidad reduced its revolving credit facility balances by $28.6 million, 
combined with a decrease in the Senior Notes of $13.8 million as a result of 
the change in the US dollar foreign exchange rate at September 30, 2012, and a 
decrease in building and equipment loans of $0.4 million. The Senior Notes are 
translated at each quarter end, as such their value will fluctuate quarterly 
with variations in exchange rates. The Senior Notes are due January 2019 and 
interest is payable semi-annually in arrears on January 15 and July 15. 
At September 30, 2012, Trinidad had CDN$104.0 million outstanding on its 
Canadian revolving credit facility and nil on its US revolving credit 
facility, leaving CDN$96.0 million and US$100.0 million unutilized in the 
facility, respectively. The Canadian and US revolving facility requires 
quarterly interest payments that are based on Bankers Acceptance and LIBOR 
rates and incorporate a tiered interest rate, which varies depending on the 
results of the Consolidated Total Debt to Consolidated EBITDA ratio (see table 
below). The facility matures on December 16, 2015, and is subject to annual 
extensions of an additional year on each anniversary. 
A total of $149.1 million of capital expenditures were spent during the nine 
months ended September 30, 2012, compared to $116.0 million for the same 
period in the prior year. Capital expenditures were substantially related to 
the Company's rig build program as well as upgrading the Company's fleet to 
meet customer demands. 
Trinidad expects cash provided by operations and the Company's various sources 
of financing to be sufficient to meet its debt repayments, future obligations 
and to fund planned capital expenditures. 
Current financial performance is well in excess of the financial ratio 
covenants under the revolving credit facility as reflected in the table below 
under IFRS: 


                                                       

RATIO                    September 30, December 31,          THRESHOLD
                                  2012         2011                   
                                                                      

Consolidated Senior Debt
to Consolidated EBITDA         0.41:1       0.59:1     3.00:1 maximum 
(1)

Consolidated Total Debt
to Consolidated EBITDA         1.96:1       2.42:1     4.00:1 maximum 
(1)

Consolidated EBITDA to
Consolidated Cash              6.91:1       5.74:1     2.75:1 minimum 
Interest Expense (1)

(1)Please see the Non-GAAP Measures Definition section of this 
document for further details.

Readers are cautioned that the ratios noted above do not have standardized 
meanings prescribed in IFRS.

OUTLOOK

The first nine months of 2012 have shown improved performance for Trinidad 
over the same time period in 2011. The strength in the first two quarters of 
the year began to tail off in the third quarter of 2012 and market conditions 
have remained soft to date in the fourth quarter of 2012. Activity levels in 
both Canada and the US, while still strong, are at lower levels than this time 
last year. Trinidad anticipates that softer market conditions will continue 
through the fourth quarter of 2012 and potentially into 2013.

Trinidad's business model is well formulated to perform strongly in the 
cyclical drilling industry. More than three quarters of the Company's fleet 
is considered high performance with high mobility and advanced drilling 
controls. Oil and gas producers are increasingly becoming aware of the 
importance of efficient, modern equipment and Trinidad's established 
reputation as a high performance driller gives it an advantage in this 
environment.

In addition, Trinidad's high proportion of long term contracts provides a 
meaningful level of revenue protection. Trinidad currently has approximately 
60.0% of its fleet under long-term, take-or-pay contracts with an average term 
remaining of 1.5 to 2.0 years. The Company has expanded its customer base over 
the past year, reducing customer concentration while also adding new customers 
with broad development opportunities. The combination of relevant, adaptable 
equipment and a solid, largely contracted customer base allows Trinidad's 
equipment to maintain more stable activity levels despite softening market 
conditions.

To date in 2012, Trinidad has completed six rigs from its 2011 capital program 
and two of the five new builds planned for construction in 2012. In addition, 
the Company has been focusing on upgrading existing equipment to ensure it 
remains marketable in an increasingly competitive industry. Trinidad has shown 
a disciplined approach to capital spending and a commitment to reaching its 
leverage goals for a number of years. In the third quarter, Trinidad 
maintained its Total Debt to EBITDA level below 2.00 times and remains 
committed to its leverage reduction strategy. The Company sees a clear path to 
meeting its long-term goal of Total Debt to EBITDA of 1.50 times. Trinidad 
will continue to carefully balance its growth program with its debt reduction 
strategy while also reviewing alternative ways of adding value for 
shareholders.

In the near term, Trinidad expects to see ongoing weakness for older style, 
mechanical rigs and increasing competition for work in high demand areas, such 
as the Bakken and the Eagle Ford. While there has been some pull back in 
utilization over the past few months, current commodity prices drive healthy 
levels of activity. Trinidad expects that as producers have new capital 
budgets to put to work in 2013, the industry will show some improvement in 
activity levels.

Trinidad is positioned to perform well in 2013 despite slightly weaker 
industry conditions. The Company's high contract base, in-demand equipment and 
expanded customer base allow it to have more steady activity and EBITDA levels 
than the industry as a whole. Looking further out, Trinidad's growing free 
cash flow position and lower leverage will allow the Company to take advantage 
of expansion opportunities both within North America and internationally.

CONFERENCE CALL

A conference call and webcast to discuss the results will be held for the 
investment community on Thursday Nov 8(th), 2012 beginning at 9:00 a.m. MT 
(11:00 a.m. ET). To participate, please dial (888) 231-8191 (toll-free in 
North America) or (647) 427-7450 approximately 10 minutes prior to the 
conference call. An archived recording of the call will be available from 
approximately 2:00 p.m. ET on Nov 8(th), 2012 until midnight Nov 15(th), 2012 
by dialing (855) 859 2056 or (416) 849-0833 and entering replay access code 
37904524.

A live audio webcast of the conference call will also be available via the 
Investor Relations page of Trinidad's website.

A full copy of Trinidad's third quarter 2012 report including Management's 
Discussion and Analysis, Consolidated Financial Statements and Notes to the 
Consolidated Financial Statements can be found on the Investor Relations page 
of Trinidad's website or at www.sedar.com

TRINIDAD DRILLING LTD.

Trinidad is a corporation focused on sustainable growth that trades on the 
Toronto Stock Exchange under the symbol TDG. Trinidad's divisions operate in 
the drilling, coring and barge-drilling sectors of the North American oil and 
natural gas industry with operations in Canada, the United States and Mexico. 
Trinidad is focused on providing modern, reliable, expertly designed equipment 
operated by well-trained and experienced personnel. Trinidad's drilling fleet 
is one of the most adaptable, technologically advanced and competitive in the 
industry.
                                                         

CONSOLIDATED STATEMENTS OF FINANCIAL                                
POSITION

As at                                     September 30, December 31,

($ thousands) - unaudited                          2012         2011
                                                                    

Assets                                                              

Current Assets                                                      

Accounts receivable                             190,843      207,143

Inventory                                        10,938       17,523

Prepaid expenses                                  6,479        6,298

Assets held for sale                             10,415        9,048
                                                218,675      240,012
                                                                    

Property and equipment                        1,307,330    1,279,826

Intangible assets and goodwill                   85,215       88,288
                                              1,611,220    1,608,126
                                                                    

Liabilities                                                         

Current Liabilities                                                 

Bank indebtedness                                 4,727        4,600

Accounts payable and accrued liabilities         80,587       88,960

Dividends payable                                 6,043        6,043

Deferred revenue                                  5,473            -

Current portion of long-term debt                   611          580
                                                 97,441      100,183
                                                                    

Long-term debt                                  537,375      580,167

Deferred income taxes                            97,193       86,550
                                                732,009      766,900
                                                                    

Shareholders' Equity                                                

Common shares                                   952,043      952,043

Contributed surplus                              50,032       49,462

Accumulated other comprehensive income         (37,117)     (25,377)
(loss)

Retained earnings (deficit)                    (85,747)    (134,902)
                                                879,211      841,226
                                              1,611,220    1,608,126


                                                                 

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
    
                                 Three months ended Nine months ended 
                                    September 30,      September 30,

($ thousands except per share       2012       2011     2012      2011
data) - unaudited
                                                                      

Revenue                                                               

Oilfield service revenue         207,906    196,645  630,798   569,742

Other revenue                      (190)        145       66     1,032
                                 207,716    196,790  630,864   570,774

Expenses                                                              

Operating expense                127,821    115,304  380,992   351,921

General and administrative        14,371     11,614   40,122    43,464

Depreciation and amortization     30,436     28,602   84,383    83,595

Foreign exchange                     810    (6,145)      715   (5,605)

Loss (gain) on sale of property       26       (63)    (295)   (5,416)
and equipment

Impairment of property and         1,290          -    8,809     8,993
equipment
                                 174,754    149,312  514,726   476,952

Finance costs                     10,288     10,933   31,586    33,766

Earnings before income taxes      22,674     36,545   84,552    60,056

Income taxes                                                          

Current                              102      (454)       66     2,712

Deferred                           2,622      6,830   17,202     6,181
                                   2,724      6,376   17,268     8,893

Net earnings                      19,950     30,169   67,284    51,163
                                                                      

Other comprehensive income                                            
(loss)

Foreign currency translation
adjustment, net of              (12,247)     27,176 (11,740)    12,328
income tax
                                (12,247)     27,176 (11,740)    12,328

Total comprehensive income         7,703     57,345   55,544    63,491
                                                                      

Earnings per share                                                    

Net earnings                                                          

  Basic / Diluted                   0.17       0.25     0.56      0.42




                                                                

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For nine months ended September 30, 2012 and 2011
                                                                       
                                                                       
                                       Accumulated                     
                                            other    Retained          
                  Common  Contributed comprehensive  earnings    Total

($ thousands) -   shares     surplus  income (loss)  (deficit)  equity
unaudited                                  (1)
                                                                       

Balance at        952,043      49,462       (25,377) (134,902)  841,226
December 31, 2011

Share-based             -         570              -         -      570
payments

Total
comprehensive           -           -       (11,740)    67,284   55,544
income (loss)

Dividends               -           -              -  (18,129) (18,129)

Balance at
September 30,     952,043      50,032       (37,117)  (85,747)  879,211
2012
                                                                       

Balance at        951,863      49,016       (30,030) (187,211)  783,638
January 1, 2011

Exercise of stock     180        (48)              -         -      132
options

Share-based             -         436              -         -      436
payments

Total
comprehensive           -           -         12,328    51,163   63,491
income (loss)

Dividends               -           -              -  (18,129) (18,129)

Balance at
September 30,     952,043      49,404       (17,702) (154,177)  829,568
2011

((1)) Accumulated other comprehensive income consisted of foreign
      currency translation adjustment.
                                                               

CONSOLIDATED STATEMENTS OF CASH FLOWS                                  

For nine months ended September 30,  

($ thousands) - unaudited                                2012      2011
                                                                       

Cash provided by (used in)                                             

Operating activities                                                   

Net earnings                                           67,284    51,163

Adjustments for:                                                       

  Depreciation and amortization                        84,383    83,595

  Foreign exchange                                        715   (5,605)

  (Gain) on sale of property and equipment              (295)   (5,416)

  Impairment of property and equipment                  8,809     8,993

  Finance costs                                        31,586    33,766

  Income taxes                                         17,268     8,893

  Other                                                 3,924     2,640

  Income taxes paid                                   (2,542)   (7,899)

  Income taxes recovered                                3,953     1,785

  Interest paid                                      (40,769)  (27,806)

  Interest received                                         8        46

Funds provided by operations                          174,324   144,155

Change in non-cash operating working capital            9,020   (3,921)

Cash provided by operations                           183,344   140,234
                                                                       

Investing activities                                                   

Purchase of property and equipment                  (149,114) (116,008)

Proceeds from disposition of property and equipment     2,678    43,792

Change in non-cash working capital                      9,704   (7,924)

Cash used by investing                              (136,732)  (80,140)
                                                                       

Financing activities                                                   

Proceeds from long-term debt                           77,239    69,738

Repayments of long-term debt                        (105,729) (100,160)

Proceeds from exercise of options                           -       130

Dividends paid                                       (18,129)  (18,128)

Financing costs                                             -   (1,180)

Cash used by financing                               (46,619)  (49,600)
                                                                       

Cash flow from operating, investing and financing         (7)    10,494
activities

Effect of translation of foreign currency cash          (120)   (1,715)

(Decrease) increase in cash for the period              (127)     8,779
                                                                       

(Bank indebtedness) cash and cash equivalents -       (4,600)     7,905
beginning of period

(Bank indebtedness) cash and cash equivalents - end   (4,727)    16,684
of period



SEGMENTED INFORMATION

The following presents the result of Trinidad's operating segments:
                                                                           

Three months                        United      Inter-                     
ended                             States /

September 30,      Canadian                     segment                    
2012                        International 

 ($ thousands)                  Operations               Corporate   Total 
                Operations                 Eliminations

 Operating           77,155        117,825            -           - 194,980
revenue 

 Other revenue           51          (241)            -           -   (190)

 Third party          8,705          4,221            -           -  12,926
recovery 

 Inter-segment        4,584              -      (4,584)           -       -
revenue 
                     90,495        121,805      (4,584)           - 207,716

 Operating           43,276         71,619            -           - 114,895
costs 

 Third party          8,705          4,221            -           -  12,926
costs 

 Inter-segment        4,584              -      (4,584)           -       -
operating 

 Operating           33,930         45,965            -           -  79,895
income 

 Depreciation
and                  10,004         20,432            -           -  30,436
amortization 

 (Gain) loss on
sale of                 177          (151)            -           -      26
property and
equipment 

 Impairment of
property and          1,290              -            -           -   1,290
equipment 

 Impairment of
intangible                -              -            -           -       -
assets and
goodwill 
                     11,471         20,281            -           -  31,752

 Segmented           22,459         25,684            -           -  48,143
income 

 General and              -              -            -      14,371  14,371
administrative 

 Foreign                  -              -            -         810     810
exchange 

 Finance costs            -              -            -      10,288  10,288

 Income taxes             -              -            -       2,724   2,724

 Net earnings        22,459         25,684            -    (28,193)  19,950
(loss)
                                                                           

 Purchase of
property and         27,145         13,092            -           -  40,237
equipment 
                                                                     
                                                                     

Three months                        United      Inter-                     
ended                             States /

September 30,      Canadian                     segment                    
2011                        International 

 ($ thousands)                  Operations               Corporate   Total 
                Operations                 Eliminations

 Operating           74,598        109,364            -           - 183,962
revenue 

 Other revenue          107             38            -           -     145

 Third party          9,396          3,287            -           -  12,683
recovery 

 Inter-segment       16,661              -     (16,661)           -       -
revenue 
                    100,762        112,689     (16,661)           - 196,790

 Operating           42,992         59,629            -           - 102,621

 Third party          9,396          3,287            -           -  12,683
costs 

 Inter-segment       16,661              -     (16,661)           -       -
operating 

 Operating           31,713         49,773            -           -  81,486
income 

 Depreciation
and                   9,042         19,560            -           -  28,602
amortization 

 (Gain) loss on
sale of                   8           (71)            -           -    (63)
property and
equipment 

 Impairment of
property and              -              -            -           -       -
equipment 

 Impairment of
intangible                -              -            -           -       -
assets and
goodwill 
                      9,050         19,489            -           -  28,539

 Segmented           22,663         30,284            -           -  52,947
(loss) income 

 General and              -              -            -      11,614  11,614
administrative 

 Foreign                  -              -            -     (6,145) (6,145)
exchange 

 Finance costs            -              -            -      10,933  10,933

 Income taxes             -              -            -       6,376   6,376

 Net earnings        22,663         30,284            -    (22,778)  30,169
(loss)
                                                                           

 Purchase of
property and         14,300         29,632            -           -  43,932
equipment 
                                                                     
                                                                     

Nine months                         United      Inter-                     
ended                             States /

September 30,      Canadian                     segment                    
2012                        International 

 ($ thousands)                  Operations               Corporate   Total 
                Operations                 Eliminations

 Operating          225,923        363,828            -           - 589,751
revenue 

 Other revenue          293          (227)            -           -      66

 Third party         27,699         13,348            -           -  41,047
recovery 

 Inter-segment        9,499              -      (9,499)           -       -
revenue 
                    263,414        376,949      (9,499)           - 630,864

 Operating          129,802        210,143            -           - 339,945
costs 

 Third party         27,699         13,348            -           -  41,047
costs 

 Inter-segment        9,499              -      (9,499)           -       -
operating 

 Operating           96,414        153,458            -           - 249,872
income 

 Depreciation
and                  25,371         59,012            -           -  84,383
amortization 

 (Gain) loss on
sale of                 224          (519)            -           -   (295)
property and
equipment 

 Impairment of
property and          7,247          1,562            -           -   8,809
equipment 
                     32,842         60,055            -           -  92,897

 Segmented           63,572         93,403            -           - 156,975
income 

 General and              -              -            -      40,122  40,122
administrative 

 Foreign                  -              -            -         715     715
exchange 

 Finance costs            -              -            -      31,586  31,586

 Income taxes             -              -            -      17,268  17,268

 Net earnings        63,572         93,403            -    (89,691)  67,284
(loss) 
                                                                           

 Purchase of
property and         88,383         60,731            -           - 149,114
equipment 
                                                                     
                                                                     

Nine months                         United      Inter-                     
ended                             States /

September 30,      Canadian                     segment                    
2011                        International 

 ($ thousands)                  Operations               Corporate   Total 
                Operations                 Eliminations

 Operating          221,685        305,188            -           - 526,873
revenue 

 Other revenue          691            341            -           -   1,032

 Third party         30,857         12,012            -           -  42,869
recovery 

 Inter-segment       42,850              -     (42,850)           -       -
revenue 
                    296,083        317,541     (42,850)           - 570,774

 Operating          134,236        174,816            -           - 309,052
costs 

 Third party         30,857         12,012            -           -  42,869
costs 

 Inter-segment       42,850              -     (42,850)           -       -
operating 

 Operating           88,140        130,713            -           - 218,853
income 

 Depreciation
and                  26,523         57,072            -           -  83,595
amortization 

 (Gain) loss on
sale of             (4,163)        (1,253)            -           - (5,416)
property and
equipment 
                     23,895         63,277            -           -  87,172

 Segmented           64,245         67,436            -           - 131,681
income 

 General and              -              -            -      43,464  43,464
administrative 

 Foreign                  -              -            -     (5,605) (5,605)
exchange 

 Finance costs            -              -            -      33,766  33,766

 Income taxes             -              -            -       8,893   8,893

 Net earnings        64,245         67,436            -    (80,518)  51,163
(loss) 
                                                                           

 Purchase of
property and         32,128         83,880            -           - 116,008
equipment 



ADVISORY

CHANGE IN PRESENTATION

Effective December 31, 2011, Trinidad changed the presentation of third party 
costs and recovery to be accounted for on a gross basis versus a net basis. 
This presentation change provides the users of the consolidated interim 
financial statements and MD&A improved disclosure on the Company's operating 
segments; in addition, the presentation more accurately reflects the legal 
form of the contracts. The change resulted in a reclassification of third 
party rental equipment costs, which were previously netted against revenue, to 
be presented on a gross basis as third party recovery and third party costs. 
In addition, third party fuel costs, which were previously reported on a gross 
basis, have been reclassified to be included in third party recovery and third 
party costs.

Additionally in the first quarter of 2012, the calculation of dayrates was 
changed to be based on operating revenue divided by operating days (drilling 
days plus move days), and now excludes third party recovery revenue as well as 
other income. Previously, only drilling days were included in the dayrate 
calculation. Furthermore, the Company began including additional disclosure in 
regards to utilization, adding utilization rate - operating day which is based 
on operating days instead of just the previously disclosed drilling day based 
utilization. The change in presentation of dayrates and utilization better 
aligns the Company's disclosure with its peers, and its management measurement 
tools. Furthermore, the change allows the users of the financial statements 
a higher degree of disclosure. See "Non-GAAP Measures Definitions" for 
calculations. The changes in presentation have been applied retrospectively.

NON-GAAP MEASURES DEFINITIONS

This document contains references to certain financial measures and associated 
per share data that do not have any standardized meaning prescribed by IFRS 
and may not be comparable to similar measures presented by other companies. 
These financial measures are computed on a consistent basis for each reporting 
period and include gross margin, gross margin percentage, gross margin - net 
percentage, EBITDA, Adjusted EBITDA, Adjusted net earnings, working capital, 
Senior Debt to EBITDA, Total Debt to EBITDA, EBITDA to Cash Interest Expense, 
drilling days, operating days, utilization rate - drilling day, utilization 
rate - operating day, and rate per operating day. These non-GAAP measures 
are identified and defined as follows under IFRS:

"Gross margin" is used by management and investors to analyze overall and 
segmented operating performance. Gross margin is not intended to represent 
operating income nor should it be viewed as an alternative to net earnings or 
other measures of financial performance calculated in accordance with IFRS. 
Gross margin is calculated from the consolidated statements of operations and 
comprehensive income (loss) and from the segmented information contained in 
the notes to the consolidated interim financial statements and is defined as 
revenue less operating expenses.

"Gross margin percentage" is used by management and investors to analyze 
overall and segmented operating performance. Gross margin percentage is 
calculated from the consolidated statements of operations and comprehensive 
income (loss) and from the segmented information in the notes to the 
consolidated interim financial statements and is defined as gross margin 
divided by revenue.

"Gross margin - net percentage" is used by management and investors to analyze 
overall and segmented operating performance. Gross margin - net percentage 
is calculated from the consolidated statements of operations and comprehensive 
income (loss) and from the segmented information in the notes to the 
consolidated interim financial statements and is defined as gross margin 
divided by revenue net of third party costs.

"EBITDA" is a measure of the Company's operating profitability. EBITDA 
provides an indication of the results generated by the Company's principal 
business activities prior to how these activities are financed, assets are 
depreciated, amortized and impaired, or how the results are taxed in various 
jurisdictions.

"Adjusted EBITDA" is used by management and investors to analyze EBITDA (as 
defined above) prior to the effect of foreign exchange and share-based payment 
expense, and is not intended to represent net earnings as calculated in 
accordance with IFRS.

"Adjusted net earnings" is used by management and the investment community to 
analyze net earnings prior to the effect of foreign exchange, share-based 
payments and impairment charges and is not intended to represent net earnings 
as calculated in accordance with IFRS.

"Working capital" is used by management and the investment community to 
analyze the operating liquidity available to the Company.

"Senior Debt to EBITDA" is defined as the consolidated balance of the 
revolving facility and other debt secured by a lien at quarter end to 
consolidated EBITDA for the trailing 12 months (TTM). Consolidated EBITDA 
used in this financial ratio is calculated as EBITDA plus share-based payments 
and unrealized foreign exchange.

"Total Debt to EBITDA" is defined as the consolidated balance of long-term 
debt, which includes the Senior Debt, Senior Notes Payable and dividends 
payable at quarter end, to consolidated EBITDA for the TTM. Consolidated 
EBITDA used in this financial ratio is calculated as EBITDA plus share-based 
payments and unrealized foreign exchange.

"EBITDA to Cash Interest Expense" is defined as the consolidated EBITDA for 
TTM to the cash interest expense on all debt balances for TTM. Consolidated 
EBITDA used in this financial ratio is calculated as EBITDA plus share-based 
payments and unrealized foreign exchange.

"Drilling days" is defined as rig days between spud to rig release.

"Operating days" is defined as moving days (move in, rig up and tear out) plus 
drilling days (spud to rig release).

"Utilization rate - drilling day" is defined as drilling days divided by total 
available rig days.

"Utilization rate - operating day" is defined as operating days (drilling days 
plus moving days) divided by total available rig days.

"Rate per operating day" is defined as operating revenue (net of third party 
costs) divided by operating days (drilling days plus moving days).

References to gross margin, gross margin percentage, gross margin - net 
percentage, EBITDA, Adjusted EBITDA, Adjusted net earnings, working capital, 
Senior Debt to EBITDA, Total Debt to EBITDA, EBITDA to Cash Interest Expense, 
drilling days, operating days, utilization rate - drilling day, utilization 
rate - operating day, and rate per operating day throughout this document have 
the meanings set out above.

FORWARD-LOOKING STATEMENTS

The document contains certain forward-looking statements relating to 
Trinidad's plans, strategies, objectives, expectations and intentions. The 
use of any of the words "expect", "anticipate", "continue", "estimate", 
"objective", "ongoing", "may", "will", "project", "should", "believe", 
"plans", "intends", "confident", "might" and similar expressions are intended 
to identify forward-looking information or statements. Various assumptions 
were used in drawing the conclusions or making the projections contained in 
the forward-looking statements throughout this document. The forward-looking 
information and statements included in this document are not guarantees of 
future performance and should not be unduly relied upon. Forward-looking 
statements are based on current expectations, estimates and projections that 
involve a number of risks and uncertainties, which could cause actual results 
to differ materially from those anticipated and described in the 
forward-looking statements. Such information and statements involve known and 
unknown risks, uncertainties and other factors that may cause actual results 
or events to differ materially from those anticipated in such forward-looking 
information or statements. In particular, but without limiting the foregoing, 
this document may contain forward-looking information and statements 
pertaining to the completion of announced rig construction programs on a 
timely basis and economical terms; the assumption that Trinidad's customers 
will honour their take-or-pay contracts; fluctuations in the demand for 
Trinidad's services; the ability for Trinidad to attract and retain qualified 
personnel, in particular field staff to crew the Company's rigs; the existence 
of competitors, technological changes and developments in the oilfield 
services industry; the existence of operating risks inherent in the oilfield 
services industry; assumptions respecting capital expenditure programs and 
other expenditures by oil and gas exploration and production companies; 
assumptions regarding commodity prices, in particular oil and natural gas; 
assumptions respecting supply and demand for commodities, in particular oil 
and natural gas; assumptions regarding foreign currency exchange rates and 
interest rates; the existence of regulatory and legislative uncertainties; the 
possibility of changes in tax laws; and general economic conditions including 
the capital and credit markets. Trinidad cautions that the foregoing list of 
assumptions, risks and uncertainties is not exhaustive. The forward-looking 
information and statements contained in this document speak only as of the 
date of this document and Trinidad assumes no obligation to publicly update or 
revise them to reflect new events or circumstances, except as may be required 
pursuant to applicable securities laws.







Lyle Whitmarsh, Chief Executive Officer

Brent Conway President

Lisa Ciulka Vice President, Investor Relations Phone: (403) 294-4401Fax: 
(403) 265-4168 Email:lciulka@trinidaddrilling.com

SOURCE: Trinidad Drilling Ltd.

To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/November2012/07/c3895.html

CO: Trinidad Drilling Ltd.
ST: Alberta
NI: OIL ERN 

-0- Nov/08/2012 02:00 GMT


 
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