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Trinidad Drilling Ltd. Reports Solid Fourth Quarter And Year-end 2012 Results; Growth In Adjusted EBITDA, Stable Operating

Trinidad Drilling Ltd. Reports Solid Fourth Quarter And Year-end 2012 Results; 
Growth In Adjusted EBITDA, Stable Operating Margins 
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION 
IN THE UNITED STATES/ 
TSX SYMBOL: TDG 
CALGARY, March 6, 2013 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or "the 
Company") reported solid 2012 results with growth in adjusted EBITDA ((1)) and 
stable operating margins. The demand for Trinidad's modern, high-performance 
equipment offset a softening in market conditions in the second half of 2012 
and adjusted EBITDA grew by 9.7% over the level recorded in 2011. 
"This past year has been an important year for Trinidad," said Lyle Whitmarsh, 
Trinidad's Chief Executive Officer. "Our fleet of modern, efficient rigs has 
continued to perform strongly despite some industry weakness, while we have 
also seen progression on a number of other fronts within the Company. In 2012, 
we grew our operations in both Canada and the US, adding nine rigs under 
long-term contract; we further diversified our customer base; and we continued 
to lower our leverage. Our progress in these and other areas has positioned us 
well for future success in 2013 and beyond." 
((1)) Please see the Non-GAAP Measures Definitions section of this document 
for further details. 


                                                                             

FINANCIAL                                                                    
HIGHLIGHTS
             Three months ended December 31,    For the years ended December
                                                            31, 

($ thousands         2012        2011       %
except share                           Change        2012        2011       %
and per                                                                Change
share data)

Revenue           209,557     231,106   (9.3)     859,327     818,150     5.0

Revenue, net      196,103     213,885   (8.3)
of third                                          803,546     757,606     6.1
party costs

Operating          77,758      88,976  (12.6)     329,151     308,487     6.7
income (1)

Operating           37.1%       38.5%   (3.6)
income                                              38.3%       37.7%     1.6
percentage
(1)

Operating           39.7%       41.6%   (4.6)
income - net                                        41.0%       40.7%     0.7
percentage
(1)

EBITDA (1)         63,323      69,545   (8.9)     272,359     250,539     8.7

  Per share          0.52        0.58
  (diluted)                            (10.3)        2.25        2.07     8.7
  (2)

Adjusted           63,332      74,401  (14.9)     277,015     252,476     9.7
EBITDA (1)

  Per share          0.52        0.62
  (diluted)                            (16.1)        2.29        2.09     9.6
  (2)

Cash               75,661      47,583    59.0
provided by                                       259,005     187,817    37.9
operations

  Per share          0.63        0.39
  (basic /                               61.5        2.14        1.55    38.1
  diluted)
  (2)

Funds              60,915      73,534  (17.2)
provided by                                       235,240     217,689     8.1
operations
(1)

  Per share          0.50        0.61
  (basic /                             (18.0)        1.95        1.80     8.3
  diluted)
  (2)

Net earnings     (12,246)      25,318 (148.4)      55,038      76,481  (28.0)

  Per share        (0.10)        0.21
  (basic /                            (147.6)        0.46        0.63  (27.0)
  diluted)
  (2)

Adjusted net       57,807      30,174    91.6     138,547      87,411    58.5
earnings (1)

  Per share          0.48        0.25
  (basic /                               92.0        1.15        0.72    59.7
  diluted)
  (2)

Capital            16,763      63,437  (73.6)
expenditures                                      163,199     135,653    20.3
net of
dispositions

Dividends           6,043       6,043       -      24,172      24,172       -
declared

Shares                                       
outstanding                                                                  
- basic 

  (weighted   120,859,476            
  average)                120,859,476       - 120,859,476 120,855,217       -
  (2)

Shares                                       
outstanding                                                                  
- diluted

  (weighted   120,859,476            
  average)                120,907,495       - 120,859,476 120,903,236       -
  (2)
                                                                       

As at                                            December    December        
                                                      31,         31,

($ thousands                                 
except                                               2012        2011       %
percentage                                                            Change 
data)

Total assets                                    1,541,294   1,608,126   (4.2)

Total                                        
long-term                                         585,629     666,717  (12.2)
liabilities



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

OPERATING                                                          
HIGHLIGHTS 
                 Three months ended December    For the years ended
                             31,                      December 31, 
                   2012   2011      % Change   2012   2011 % Change

Land Drilling                                                      
Market 

Operating days                                                     
(1)
    Canada         2,915  3,665        (20.5) 11,543 13,345   (13.5)


United States  4,789  5,547        (13.7) 20,378 21,383    (4.7)
  and
  International 
Rate per                                                           
operating day     
(2, 3) 
Canada (CDN$) 26,190 23,652          10.7 24,637 21,338     15.5 
United States 22,305 20,710           7.7 22,335 18,929     18.0
  and
  International
  (CDN$) 
United States 22,589 20,387          10.8 22,285 19,153     16.4
  and
  International
  (US$) 
Utilization rate                                                   
- operating day   
(1, 4) 
Canada           56%    74%        (24.3)    56%    67%   (16.4) 
United States    77%    92%        (16.3)    83%    91%    (8.8)
  and
  International 
Utilization        -      -             -      -    51%        -
  rate for
  service rigs
  (5)  
Number of                                                          
drilling rigs at  
period end 
Canada            59     54           9.3     59     54      9.3 
United States     68     64           6.3     68     64      6.3
  and
  International 
Number of         15     20        (25.0)     15     20   (25.0)
  coring and
  surface casing
  rigs at period
  end 
Barge Drilling                                                     
Market  
Operating        386    373           3.5  1,555  1,708    (9.0)
  days (1) 
Rate per      29,954 25,835          15.9 28,669 23,765     20.6
  operating day
  (CDN$) (2, 3) 
Rate per      30,330 25,455          19.2 28,612 24,087     18.8
  operating day
  (US$) (2, 3) 
Utilization      84%    81%           3.7    85%    94%    (9.6)
  rate -
  operating day
  (4) 
Number of          2      2             -      2      2        -
  barge drilling
  rigs at period
  end 
Number of          3      3             -      3      3        -
  barge drilling
  rigs under
  Bareboat
  Charter
  Agreements at
  period end 
                                                                
                                                                
(1) Operating days include drill days and move days. 
(2) Rate per operating day is based on operating revenue divided by 
operating days. 
(3) Operating revenue is presented net of third party costs. 
(4) Utilization rate - operating day is based on operating days divided 
by total days available. 
(5) In the second quarter of 2011, Trinidad disposed of its 22 well 


    servicing rigs and related equipment.

OVERVIEW

Over the past few years the drilling industry has experienced a high level of 
volatility and 2012 was no different. The industry started the year with 
strong activity levels and increasing pricing as demand remained high, 
especially in oil and liquids-rich plays. Natural gas prices, particularly in 
the first half of the year, were weak during 2012 and the industry saw a large 
migration of rigs from dry gas plays into oil or liquids-rich areas. 
Trinidad's high contract base and adaptable equipment allowed the Company to 
move a large number of its rigs under their contract terms with minimal impact 
to its operations.

As 2012 progressed, crude oil prices began to weaken resulting in reduced 
capital spending by oil and gas producers and lower activity levels in the 
drilling industry. Tighter economics led customers to be more concerned about 
the efficiency of the drilling equipment they were using and the gap between 
modern, high-performance equipment and older, conventional-style rigs became 
more apparent. With more than three-quarters of Trinidad's fleet classified as 
high-performance rigs, the Company's operations were far less impacted than 
the industry as a whole; its activity levels continued to outperform the 
industry and its dayrates remained strong.

INDUSTRY STATISTICS
                                                                         
             Year                           Year
               to                2012         to                2011
             date                           date
            2012    Q4    Q3    Q2     Q1  2011    Q4    Q3     Q2    Q1

Commodity                                                                
Prices

Henry Hub
natural gas  2.75  3.40  2.88  2.29   2.43  4.00  3.33  4.12   4.37  4.18
price (US$
per mmBtu)

Western
Canada
Select
crude oil
price
   (CDN$
per barrel) 71.70 60.73 76.29 74.10  75.91 77.53 83.38 73.52  81.96 71.34

WTI crude
oil price   94.09 88.17 92.15 93.30 102.99 94.88 94.02 89.49 102.02 94.07
(US$ per
barrel)
                                                                         

US Industry                                                              
Activity

Average US
industry
active land 1,852 1,741 1,837 1,902  1,929 1,825 1,954 1,893  1,778 1,674
rig count
(1)

Average
Trinidad
active land    57    56    55    58     58    59    60    61     57    57
rig count
(2)
                                                                         

Canadian
Industry                                                                 
Activity

Average
Canadian
industry      39%   36%   42%   18%    65%   49%   54%   54%    23%   66%
utilization
(3)

Average
Trinidad      52%   51%   58%   24%    77%   62%   69%   69%    31%   80%
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.

Trinidad recorded strong results in 2012. Higher dayrates, although partly 
offset by lower operating days, drove increased revenue levels; and combined 
with an ongoing focus on cost control, adjusted EBITDA grew by 9.7% in 2012 
compared to the prior year.

Adjusted net earnings increased 58.5% in 2012 over the previous year as a 
result of increased EBITDA, lower finance costs, lower income taxes and a 
larger gain on sale of assets. Net earnings in 2012 were lower than the 
previous year largely as a result of an impairment charge recorded in the 
fourth quarter of 2012.

In addition to achieving strong financial results, the Company added nine rigs 
to its operations during the year, five in Canada and four in the US. These 
rigs were all added under long-term, take-or-pay contracts and are equipped 
with the latest automation and advancements in drilling technology. As well, 
the Company was successful in reducing its rig concentration with one 
customer. Trinidad also added several new customers throughout the year, 
including two major producers with extensive future growth programs. In 
addition, the Company continues to work for a number of very active national 
oil companies. Trinidad was also able to make improvements to its 
above-average safety standards, further reducing the number of safety 
incidents in its operation during 2012.

Trinidad remains committed to its leverage reduction strategy and reduced its 
Total Debt to EBITDA ratio during 2012 to 1.91 times from 2.42 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 EBITDA of 1.50 times.

FOURTH QUARTER 2012 HIGHLIGHTS
    --  Adjusted EBITDA in the fourth quarter was $63.3 million, down
        14.9% from the same quarter last year. Lower operating days in
        the current quarter more than offset the impact of higher
        dayrates and led to lower operating income. In addition, higher
        G&A expenses due to a one time bad debt expense of $1.6 million
        in the current period further reduced adjusted EBITDA.
    --  Operating income - net percentage was 39.7% in fourth quarter
        2012, in line with the third quarter of 2012 but down from
        41.6% in the same quarter last year. Operating income - net
        percentage decreased year over year largely as a result of
        lower operating income and higher repairs and maintenance costs
        in the current quarter.
    --  Adjusted net earnings in the fourth quarter were $57.8 million
        ($0.48 per share (diluted)) up 91.6% from the same quarter last
        year as lower finance costs and income taxes and a larger gain
        on sale of assets offset lower adjusted EBITDA in the current
        quarter.
    --  Net earnings showed a loss of $12.4 million ($0.10 per share
        (diluted)) for the quarter, down 149.0% from the comparative
        period in 2011. Net earnings lowered quarter over quarter due
        to an impairment of $70.1 million recorded in the fourth
        quarter of 2012.
    --  Trinidad continued to repay debt in the fourth quarter of 2012,
        lowering both the total debt outstanding and its Total Debt to
        EBITDA level. Total long-term liabilities lowered by $48.9
        million in the last three months of the year and Total Debt to
        EBITDA was reduced to 1.91 times, compared to 1.96 times at the
        end of the third quarter of 2012 and 2.42 times at the end of
        2011.
    --  During the quarter, Trinidad added two newly built rigs to its
        Canadian operations, both under five-year, take-or-pay
        contracts and continued construction of the two remaining rigs
        in its 2012 rig build program.
    --  In the fourth quarter of 2012, Trinidad recorded an impairment
        expense on certain rig and related equipment and building
        assets of $70.1 million. A total of $63.3 million was recorded
        in the US and international operations and $6.8 million in the
        Canadian operations. The impairment was based on appraisals
        obtained for assets deemed to be non-core.

FULL YEAR 2012 HIGHLIGHTS
    --  Trinidad generated revenue of $859.3 million in 2012, an
        increase of 5.0% from 2011. Revenue grew in the current year 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 second half
        of the year.
    --  Operating income - net percentage was 41.0% in 2012, compared
        to 40.7% in 2011. The impact of higher revenue in 2012 was
        offset by increased operating costs in the US and international
        operations related to higher repairs and maintenance expenses
        incurred on rigs that had been working consistently for a
        number of years, leaving operating income - net percentage
        largely unchanged when compared to the prior year.
    --  Adjusted EBITDA was $277.0 million in 2012, up 9.7% from 2011.
        Adjusted EBITDA increased in 2012 as a result of higher
        operating income and lower general and administrative costs
        (excluding share-based payments) compared to the prior year.
    --  Adjusted net earnings were $138.5 million ($1.15 per share
        (diluted)) in 2012, up 58.5% from 2011 due to a higher adjusted
        EBITDA, lower finance costs, higher gain on asset sales and
        lower income taxes.
    --  Net earnings were $55.0 million ($0.46 per share (diluted)) in
        2012, down 28.0% from 2011. Net earnings decreased in 2012
        largely due to an impairment of property and equipment.
    --  In 2012, Trinidad continued to lower its leverage level and
        recorded Total Debt to EBITDA of 1.91 times, compared to 2.42
        times at year-end 2011 and 3.18 times at the end of 2010.
        Trinidad remains committed to lowering its leverage with a
        long-term target of 1.50 times.
    --  During the year, Trinidad added nine newly built rigs to its
        operations, all under long-term, take-or-pay contracts.
    --  For the year ended December 31, 2012, due to the slow-down of
        the drilling industry, Trinidad recorded an impairment expense
        of $78.9 million for non-core rig and rig related equipment and
        certain building assets, with the majority included in the US
        and international operations.

RESULTS FROM OPERATIONS
                                                                       

Canadian                                                               
Operations 
                                                                       
             Three months ended December   For the years ended December
                                     31,                           31, 

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

Operating
revenue (1,  77,577 89,250        (13.1)   303,500 310,935        (2.4)
2, 3)

Other           120    132         (9.1)       414     823       (49.7)
revenue
             77,697 89,382        (13.1)   303,914 311,758        (2.5)

Operating
costs (1, 2, 47,308 54,459        (13.1)   177,111 188,695        (6.1)
3)

Operating    30,389 34,923        (13.0)   126,803 123,063          3.0
income (10)

Operating
income - net  39.1%  39.1%                   41.7%   39.5%             
percentage
(10)
                                                                       

Drilling      2,677  3,427        (21.9)    10,646  12,390       (14.1)
days

Operating     2,915  3,665        (20.5)    11,543  13,345       (13.5)
days (4)

Rate per
operating    26,190 23,652          10.7    24,637  21,338         15.5
day (CDN$)
(5)

Utilization
rate -          56%    74%        (24.3)       56%     67%       (16.4)
operating
day (6)

Utilization
rate -          51%    69%        (26.1)       52%     62%       (16.1)
drilling day
(7)

CAODC
industry        36%    54%        (33.3)       39%     49%       (20.4)
average (8)

Number of
drilling         59     54           9.3        59      54          9.3
rigs at
period end
                                                                       

 Utilization
rate for          -      -             -         -     51%            -
service rigs
(9)

 Number of
coring and
surface rigs     15     20        (25.0)        15      20       (25.0)
at period
end 
                                                                       



(1)  Inter-segment revenue and operating costs have been excluded of
     $0.1 million and $9.6 million for the three and twelve months
     ended December 31, 2012, respectively, and $13.7 million and $56.6
     million for the three and twelve months ended December 31, 2011,
     respectively. Each of these inter-segment revenue and operating
     costs relates to rig construction for the US operations.

(2)  External construction revenue and operating costs are included in
     the table above of $0.3 million and $3.3 million, respectively,
     for the year ended December 31, 2012, and $2.1 million and $2.7
     million, respectively, for the year ended December 31, 2011.
     External construction revenue and operating costs are included in
     the table above of $0.1 million and $3.0 million, respectively,
     for the three months ended December 31, 2012, and $1.0 million and
     $1.1 million, respectively, for the three months ended December
     31, 2011.

(3)  Operating revenue and operating costs exclude third party recovery
     and third party costs of $37.5 million for the twelve months ended
     December 31, 2012, and $43.8 million for the twelve months ended
     December 31, 2011. Operating revenue and operating costs exclude
     third party recovery and third party costs of $9.8 million for the
     three months ended December 31, 2012, and $12.9 million for the
     three months ended December 31, 2011.

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

(5)  Rate per operating day is based on operating revenue divided by
     operating days.

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

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

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

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

(10) See Non-GAAP Measures Definition and Additional GAAP Measures
     Definition section of this document for further details.

Fourth Quarter 2012

Trinidad's Canadian operations performed strongly throughout the first half of 
2012; however, the second half of the year reflected a shift in industry 
conditions with activity levels decreasing compared to the prior year. 
Although a slow down over the December holiday period is typical in the 
drilling industry, the fourth quarter of 2012 experienced a more significant 
reduction in activity levels on its lower capacity and lower specification 
equipment than was experienced in the prior year. This style of rig makes up a 
small portion of Trinidad's fleet; however, the reduced activity levels led to 
lower overall utilization and revenue in the current quarter. The operating 
days for the fourth quarter declined to 2,915 operating days and utilization 
of 56% in 2012, 3,233 days and 62% in the third quarter and 3,665 days and 74% 
utilization in the fourth quarter of 2011. The reduction in activity levels 
was consistent with the industry as oil and gas production companies took a 
cautious outlook on their capital spending in the fourth quarter due to 
weakening commodity prices.

Although operating days decreased into the fourth quarter, average dayrates 
grew substantially in the current period when compared to the third quarter of 
2012 and fourth quarter of 2011. Average dayrates in the fourth quarter of 
2012 were $2,689 per day higher than the third quarter of 2012, and $2,538 per 
day higher than the fourth quarter of 2011. The higher dayrates over the third 
quarter of 2012 were driven by additional equipment rental income, typical of 
the winter drilling season; while the higher dayrates versus the prior year 
were driven by a shift in rig mix, combined with additional new builds and a 
crew wage increase. The shift in rig mix had a favourable impact on dayrates 
as a combination of additional new builds as well as the reduced demand for 
lower capacity and lower specification equipment resulted in a higher 
percentage of operating days coming from the higher specification equipment 
which commands significantly higher dayrates and margins. In addition, standby 
revenue in the fourth quarter of 2012 accounted for $962 per day of the 
increase, while the standby revenue in the third quarter of 2012 and fourth 
quarter of 2011 accounted for $432 per day and $254 per day, respectively. 
Standby revenue inflates dayrates as the standby days do not count as 
operating days.

During the current quarter, Trinidad's coring division began to prepare for 
their winter season. Activity typically commences towards the end of the year 
and continues through the first quarter. However, costs associated with crew 
training and recruitment as well as rig reactivation costs generally occur in 
the fourth quarter with revenues recognized in the first quarter of the 
following year. This timing difference causes an unbalanced amount of expenses 
when compared to revenue related to these rigs. During the fourth quarter, 
Trinidad sold five of its underutilized coring rigs for a loss on the sale of 
less than $0.1 million.

In addition, in the fourth quarter of the current year, the Company's 
manufacturing division recorded a $2.9 million inventory write-off, which was 
reflected in the operating costs in the current period. Trinidad identified 
inventory related to the maintenance and upgrade of non-core assets and 
determined that these items would not be utilized within the organization.

Operating income - net percentage was 39.1% in the fourth quarter of 2012, in 
line with the same quarter last year but down from 43.9% recorded in the third 
quarter of 2012. In the current period, higher dayrates and strong activity 
levels in the Company's high quality drilling equipment were offset by a 
decrease in activity in the lower specification equipment; these factors, 
combined with an inventory write-off in the Company's manufacturing division, 
caused operating income - net percentage to decrease compared to the previous 
quarter in the Canadian operations.

Full Year 2012

In the current year, operating income increased by $3.7 million, or 3.0%, 
versus the same period of the prior year as higher dayrates in the contract 
drilling division, driven by strong demand in the first half of the year, more 
than offset lower activity levels in the latter half of the year. As well, 
Trinidad added five new rigs to its Canadian operation which increased the 
revenue generating capacity of the division and offset the negative impact of 
the sale of the well servicing rig assets in the second quarter of 2011. The 
strong operating performance of the Canadian operations was slightly offset by 
the negative impact of a $2.9 million inventory write-down in the Company's 
manufacturing division. Trinidad identified inventory related to the 
maintenance and upgrade of non-core assets and determined that these items 
would not be utilized within the organization.

Dayrates in Trinidad's Canadian operations increased in 2012 by $3,299 per 
operating day, compared to the previous year. Strong customer demand, 
particularly for high performance equipment, drove dayrates higher in the 
current year.

The full impact of higher dayrates was not reflected in the operating income - 
net percentage as a portion of the increase was the result of higher crew 
wages; these expenses are passed on to the operator at cost. In addition, 
dayrates were higher by $604 per operating day related to standby revenue in 
the current year versus $188 per operating day in the prior year. Standby 
revenues do not generate operating days, and therefore, inflate dayrates. 
Trinidad experienced an increased level of standby revenue in 2012 compared to 
2011 as weaker commodity prices caused producers to reduce activity and 
re-evaluate capital programs.

Trinidad saw a softening of activity levels in the latter half of the current 
year mainly related to the Company's lower capacity equipment. Slower activity 
levels were largely driven by reduced capital spending by producers and 
uncertainty in relation to current and future commodity prices. However, the 
impact was muted by the Company's high level of a modern and technologically 
advanced fleet. Trinidad consistently outperforms industry activity levels and 
continued with this trend throughout the current period. For the year ended 
December 31, 2012, Trinidad recorded average utilization that was 13 
percentage points higher than the industry, strongly demonstrating the ongoing 
demand for this type of equipment.

Operating income - net percentage in 2012 was higher than the prior year due 
to improved dayrates and an ongoing commitment to cost containment in the 
Canadian operations. In addition, the Company benefited from improved 
economies of scale in the current year due to the increased number of contract 
drilling rigs which generate higher margins and require less overhead than the 
well service assets, which were sold in the prior year.

During the year ended December 31, 2012, Trinidad's active rig fleet increased 
by five rigs; these rigs were constructed at the Company's in-house 
manufacturing division and were put into service under long-term, take-or-pay 
contracts. One new build was added in the second quarter, and two new builds 
were added in each of the third and fourth quarters of the current year.

Trinidad expects to complete construction of two additional rigs that were 
originally included in the 2012 new build program during the first half of 
2013. At the date of this report, there have been no additional new build 
contracts signed for 2013. In comparison, by the end of 2011, the 
manufacturing division had delivered three rigs into the US operations and 
continued construction on two additional new builds that were added in early 
2012.

In the second quarter of 2011, Trinidad sold its well service rig operations 
for proceeds of $38.0 million, excluding positive working capital. The 
decision to sell these assets reflected the Company's strategy to focus on its 
core business, the deep, modern contract drilling market where the Company can 
achieve greater economies of scale and anticipates greater opportunities for 
future growth. As such, there were no service rigs operating in 2012.

In the fourth quarter of 2012, Trinidad sold five of its coring rigs, reducing 
the Company's total number of coring rigs to 15 at December 31, 2012. The sale 
of these assets was in-line with the Company's strategy to dispose of 
underutilized assets. The loss on sale of these assets amounted to less than 
$0.1 million.
                                                                    

US &
International                                                       
Operations
                                                                    
              Three months ended December        For the years ended
                                      31,               December 31,

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

Operating     118,398 124,522       (4.9)   499,852 445,526     12.2
revenue (1)

Other revenue       8    (19)       142.1     (220)     322  (168.3)
              118,406 124,503       (4.9)   499,632 445,848     12.1

Operating      71,037  70,450         0.8   297,284 260,424     14.2
costs (1)

Operating      47,369  54,053      (12.4)   202,348 185,424      9.1
income (6)

Operating
income - net    40.0%   43.4%                 40.5%   41.6%         
percentage
(6)
                                                                    

 Land
Drilling                                                            
Rigs 

Drilling days   4,168   4,955      (15.9)    17,663  19,192    (8.0)

Operating       4,789   5,547      (13.7)    20,378  21,383    (4.7)
days (2)

Rate per
operating day  22,305  20,710         7.7    22,335  18,929     18.0
(CDN$) (3)

Rate per
operating day  22,589  20,387        10.8    22,285  19,153     16.4
(US$) (3)

Utilization
rate -            77%     92%      (16.3)       83%     91%    (8.8)
operating day
(4)

Utilization
rate -            67%     82%      (18.3)       72%     82%   (12.2)
drilling day
(5)

Number of
drilling rigs      68      64         6.3        68      64      6.3
at period end
                                                                    

 Barge
Drilling                                                            
Rigs 

Operating         386     373         3.5     1,555   1,708    (9.0)
days (2)

Rate per
operating day  29,954  25,835        15.9    28,669  23,765     20.6
(CDN$) (3)

Rate per
operating day  30,330  25,455        19.2    28,612  24,087     18.8
(US$) (3)

Utilization
rate -            84%     81%         3.7       85%     94%    (9.6)
operating day
(4)

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

Number of
barge
drilling rigs
under               3       3           -         3       3        -
Bareboat
Charter
Agreements at
period end



(1) Operating revenue and operating costs exclude third party recovery
    and third party costs of $18.2 million for the twelve months ended
    December 31, 2012, and $16.8 million for the twelve months ended
    December 31, 2011. Operating revenue and operating costs exclude
    third party recovery and third party costs of $3.6 million for the
    three months ended December 31, 2012, and $4.3 million for the
    three months ended December 31, 2011.

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

(3) Rate per operating day is based on operating revenue divided by
    operating days.

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

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

(6) See Non-GAAP Measures Definition and Additional GAAP Measures
    Definition section of this document for further details.

Fourth Quarter 2012

Operating revenue decreased in Trinidad's US and international operations in 
the fourth quarter of 2012 compared to the fourth quarter of 2011 and the 
third quarter of 2012 as lower operating days offset the impact of higher 
dayrates.

Dayrates improved in all quarters of 2012 over the comparative quarters of the 
prior year, with average dayrates of US$22,589 per day in the fourth quarter 
of 2012, an increase of US$2,202 per day compared to the fourth quarter of 
2011 and US$326 per day compared to the third quarter of 2012. Higher dayrates 
were largely a result of increased demand for Trinidad's modern equipment as 
well as the movement of rigs into higher revenue generating areas. In 
addition, a shift in rig mix also positively impacted dayrates as reduced 
activity levels were mainly isolated to lower specification rigs as operators 
looked to high grade equipment. As well, an increase in standby revenue in the 
current period of US$810 per day, versus US$179 per day in the prior year, 
increased the dayrate.

Although Trinidad saw an improvement in dayrates, operating days and 
utilization decreased when compared to the prior year and the prior quarter. 
Total operating days decreased to 4,789 days in the quarter, compared to 5,547 
days in the fourth quarter of 2011 and 5,038 days in the third quarter of 
2012. The decrease in operating days was mainly related to a decline in 
customer demand for the Company's lower specification equipment, a result of 
declining oil prices and reduced capital spending.

Operating income - net percentage in the current period was 40.0%, down from 
43.4% in the same quarter last year as a result of reduced activity levels in 
the Company's lower specification and lower technological equipment which 
reduced operating revenue in the quarter. In addition, operating income - net 
percentage was negatively impacted by higher repairs and maintenance costs as 
the Company took the opportunity to perform work on rigs that had been working 
consistently for a number of years. Labour costs also increased due to timing 
delays on customer drilling programs. When compared to the third quarter of 
2012, operating income - net percentage increased from 37.5% as a result of a 
change in rig mix. In the current quarter, a higher proportion of the 
division's modern, technically-advanced rigs were working, which tend to 
generate higher margins.

The Company's barge rigs continued to show strong operating conditions in the 
fourth quarter of 2012. Dayrates improved in the period when compared to the 
prior quarter and the fourth quarter of 2011. Utilization and operating days 
were fairly consistent in each of the quarters mentioned above, showing the 
continued demand for Trinidad's expertise in barge drilling.

Full Year 2012

Trinidad's US and international operations performed strongly throughout 2012 
when compared to the same period of the prior year. However, softening market 
conditions were reflected in reduced operating days during the third and 
fourth quarters of 2012. While the shift in industry demand reduced Trinidad's 
activity levels, total revenues still outperformed the previous year due to 
Trinidad's fleet of in-demand, higher specification equipment, combined with 
the high concentration of long-term, take-or-pay contracts.

Solid industry demand for Trinidad's modern, high performance equipment led to 
strong dayrates throughout the current year. Dayrates peaked in the second 
quarter of 2012 and stayed relatively stable for the remainder of the year, 
averaging US$22,285 per day in 2012, up US$3,132 per day from the previous 
year. Higher dayrates in 2012 led to record operating revenue generation of 
$499.9 million in the current year, a 12.2% increase over the prior year. 
Although Trinidad's technically advanced equipment continued to produce strong 
dayrates, the lower specification rigs, which make up a small portion of the 
fleet, showed a slow-down in operations. For the year ended December 31, 2012, 
Trinidad recorded an impairment expense on these lower specification rigs of 
$64.8 million.

The full impact of dayrate increases was not reflected in the operating income 
- 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 
year, the Company recorded higher standby revenue versus the prior year, which 
increased dayrates as revenue is incurred with no associated operating days. 
Overall, dayrates were higher by US$978 per operating day related to standby 
revenues in the current year versus US$96 per operating day in the prior year. 
Trinidad experienced an increased level of standby revenue in 2012 compared to 
2011 as weaker commodity prices caused producers to reduce activity and 
re-evaluate capital programs.

Although revenues remained strong, operating income - net percentage declined 
slightly in the current year when compared to the prior year. As rigs 
previously drilling dry gas became available, customers chose to high grade 
their equipment, resulting in reduced activity levels in the Company's lower 
specification equipment. In addition, operating income - net percentage was 
negatively impacted by higher repair and maintenance costs as the Company took 
the opportunity to perform work on rigs that had been working consistently for 
a number of years. Labor costs also increased due to timing delays on customer 
drilling programs, particularly in the second half of the year. 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 operating income.

Utilization in 2012 was lower than the levels experienced in 2011 with 
activity levels declining gradually throughout the year. As in the Canadian 
operations, the Company experienced weaker utilization for its spot market and 
lower specification equipment in 2012. Slower activity levels were largely 
driven by reduced capital spending by producers and uncertainty in relation to 
current and future commodity prices. However, as the majority of Trinidad's 
fleet is composed of high performance equipment with a high level of long-term 
contracts, the Company expects to have a limited exposure to the impact of the 
weaker activity levels as the decline has been more prevalent in the lower 
technology equipment.

Trinidad increased its number of land drilling rigs by four during the current 
period. Two rigs were delivered into the US operations in each of the first 
two quarters of 2012; each of these rigs were purchased externally and 
retrofitted to meet the Company's specifications. All four rigs delivered into 
service in 2012 were delivered into the Niobrara shale area in Wyoming on 
three-year, take-or-pay contracts.

The Company's barge drilling operations continued to perform well, with 
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. Higher dayrates were slightly offset by a decrease in operating 
days in the current period due to weather delays in the third quarter of 2012.

QUARTER ANALYSIS

FINANCIAL HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                       
                                    2012                     2011 

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

Revenue              209.6  215.1 174.3  260.4 231.1  202.8 154.9 229.4

Operating income      77.8   80.6  66.4  104.4  89.0   81.7  52.9  84.9
(1)

Operating income     37.1%  37.5% 38.1%  40.1% 38.5%  40.3% 34.2% 37.0%
percentage (1)

Operating income -   39.7%  40.0% 40.0%  43.5% 41.6%  43.0% 36.7% 40.5%
net percentage (1)

Net earnings (loss) (12.4)   20.0  12.9   34.5  25.3   30.2   5.0  16.0
for the year

Adjustments for:                                                       

  Depreciation and    29.2   30.4  25.8   28.1  29.1   28.6  25.4  29.6
  amortization 

  Foreign exchange   (1.4)    0.8 (0.7)    0.5   2.4  (6.1) (1.2)   1.8

  Loss (gain) on
  sale of property  (11.5)      - (0.5)    0.2 (0.6)  (0.1) (5.3)     -
  and equipment 

  Impairment of
  property and        70.1    1.3     -    7.5     -      -   9.0     -
  equipment 

  Finance costs       10.1   10.3  10.5   10.8  10.9   10.9  10.5  12.4

  Income taxes      (22.2)    2.7   4.4   10.2   4.8    6.4 (3.4)   5.9

  Other                1.4    2.9   1.0    0.1   2.5  (0.5) (0.9)   4.0

  Income taxes       (2.0)  (1.1) (0.7)  (0.7)     -  (4.5) (0.9) (2.4)
  paid 

  Income taxes         0.7    3.9     -      -   0.8    1.5     -   0.2
  recovered 

  Interest paid      (1.1) (19.5) (1.5) (19.8) (1.6) (21.4) (3.3) (3.1)

Funds provided by     60.9   51.7  51.2   71.4  73.6   45.0  34.9  64.4
operations (1)

Net earnings (loss) (0.10)   0.17  0.11   0.29  0.21   0.25  0.04  0.13
per share (diluted)

Funds provided by
operations per        0.50   0.43  0.42   0.59  0.61   0.37  0.29  0.53
share (diluted)
                                                                       

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

NON-GAAP MEASURES HIGHLIGHTS - QUARTERLY ANALYSIS
                                                                         
                              2012                           2011 

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

EBITDA (1)                 53,081  91,240  69,545  76,016  41,164  63,814
            63,323 64,715

  Per share
  (diluted)   0.52   0.54    0.44    0.75    0.58    0.63    0.34    0.53
  (2)

Adjusted                   53,344  91,951  74,401  69,382  39,069  69,624
EBITDA (1)  63,332 68,388

  Per share
  (diluted)   0.52   0.57    0.44    0.76    0.62    0.57    0.32    0.58
  (2)

Adjusted
net                        13,129  42,698  30,174  23,535  11,903  21,799
earnings    57,807 24,913
(1)

  Per share
  (diluted)   0.48   0.21    0.11    0.35    0.25    0.19    0.10    0.18
  (2)
                                                                 

(1) See the Non-GAAP Measures Definitions and Additional 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 
                   Q4     Q3     Q2     Q1     Q4     Q3     Q2     Q1 

Land Drilling                                                           
Market 

Operating days                                                          
(1)
    Canada         2,915  3,233  1,288  4,107  3,665  3,675  1,646  4,359


United States
  and             4,789  5,038  5,289  5,262  5,547  5,579  5,170  5,088
  International 
Rate per          
operating day                                                           
(2,3) 
Canada (CDN$) 26,190 23,501 25,343 24,206 23,652 20,315 20,796 20,459 
United States
  and            22,305 22,518 22,586 21,935 20,710 18,600 18,470 17,815
  International
  (CDN$) 
United States
  and            22,589 22,263 22,616 21,698 20,387 19,143 19,095 17,878
  International
  (US$) 
Utilization rate  
- operating day                                                         
(4) 
Canada           56%    62%    26%    84%    74%    74%    34%    87% 
United States
  and               77%    81%    86%    90%    92%    92%    89%    90%
  International 
Utilization
  rate for            -      -      -      -      -      -    34%    66%
  service rigs
  (5) 
Number of         
drilling rigs at                                                        
quarter end 
Canada            59     57     55     54     54     54     54     55 
United States
  and                68     68     68     66     64     66     65     63
  International 
Number of
  service rigs        -      -      -      -      -      -      -     22
  at quarter end
  (5) 
Number of
  coring and
  surface casing     15     20     20     20     20     20     20     20
  rigs at
  quarter end 
                                                                     
Barge Drilling                                                          
Market  
Operating        386    376    429    364    373    454    436    445
  days (1) 
Rate per
  operating day  29,954 30,008 29,072 25,448 25,835 24,833 22,680 22,004
  (CDN$) (2,3) 
Rate per
  operating day  30,330 29,583 29,106 25,204 25,455 25,547 23,441 22,083
  (US$) (2,3) 
Utilization
  rate -            84%    82%    94%    80%    81%    99%    96%    99%
  operating day
  (4) 
Number of
  barge drilling      2      2      2      2      2      2      2      2
  rigs at
  quarter end  
Number of
  barge drilling
  rigs                3      3      3      3      3      3      3      3
  under Bareboat
  Charter at
  quarter end  
                                                                     
(1) Operating days include drill days and move days. 
(2) Rate per operating day is based on operating revenue divided by 
operating days. 
(3) Operating revenue is presented net of third party costs. 
(4) Utilization rate - operating day is based on operating days divided 
by total days available. 
(5) In the second quarter of 2011, Trinidad disposed of its 22 well 
servicing rigs and related equipment. 
FINANCIAL SUMMARY 
                                                                    
As at                              December 31, December 31,            
($ thousands)                              2012         2011  $ Change  
Working capital (1)                     109,412      139,829   (30,417) 
                                                                    
Current portion of long-term debt           617          580         37 
Long-term debt (2)                      509,215      580,167   (70,952) 
Total long-term debt                    509,832      580,747   (70,915) 
Total long-term debt as a                 33.1%        36.1%           
percentage of assets 
                                                                    
Total assets                          1,541,294    1,608,126   (66,832) 
Total long-term liabilities             585,629      666,717   (81,088) 
Total long-term liabilities as a          38.0%        41.5%           
percentage of assets 
                                                                    
Shareholders' equity                    863,849      841,226     22,623 
Total debt to shareholders' equity        59.0%        69.0%            
                                                                    
(1) See Non-GAAP Measures Definition section of this document for 
further details. 
(2) Long-term debt is net of associated transaction costs. 
For the year ended December 31, 2012, working capital decreased by $30.4 
million compared to 2011 due to a decrease in current assets of $38.8 million 
and a decrease in current liabilities of $8.4 million. The decrease in current 
assets was mainly a result of a reduction in receivables due to lower activity 
levels in the fourth quarter of 2012 versus the prior year. In addition, 
current assets decreased due to lower inventory reflecting a decrease in the 
level of rig construction and a write down of inventory at the end of the 
current period, as well as a decrease in assets held for sale as items have 
been sold or re-classified during the period; these were offset by an increase 
in cash at period end. 
The decrease in current liabilities during the period was mainly a result of a 
decrease in bank indebtedness due to the Company being in a net positive cash 
position at December 31, 2012, as well as a decrease in payables due to lower 
activity levels in the fourth quarter of 2012 versus the prior year, which was 
offset slightly by an increase in deferred revenue related to delay and early 
termination revenues accrued in the current period. 
Trinidad's total long-term debt balance declined by $70.9 million during the 
current year when compared to the year ended December 31, 2011. The reduction 
in debt was due to a decrease in the value of the Senior Notes as well as a 
decrease in the revolving debt balances at year end. The decline in debt is in 
line with the Company's core objective of sustainable growth, in conjunction 
with leverage reduction. 
The value of Senior Notes decreased by $7.6 million as a result of the change 
in the US dollar foreign exchange rate at December 31, 2012. 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. 
Trinidad's total long-term debt balance decreased by an additional $62.8 
million as a result of payments made on the outstanding revolving debt. At 
December 31, 2012, Trinidad had $50.0 million outstanding on its Canadian 
revolving credit facility and US$20.0 million on its US revolving credit 
facility, leaving $150.0 million and US$80.0 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, 2016, and is subject to annual 
extensions of an additional year on each anniversary. The remaining change 
in long-term debt is related to building loans, which decreased by $0.6 
million due to payments made in the current year. 
A total of $185.7 million of capital expenditures were spent during the year 
ended December 31, 2012, compared to $182.2 million for the same period in the 
prior year. Capital expenditures were substantially related to the Company's 
rig build program as the Company delivered five rigs into service in the 
Canadian operations and four into service in the US operations in the current 
year, as well as continuing construction on two additional new builds expected 
to be delivered into the Canadian operations in the first half of 2013. In 
addition, the Company completed rig upgrades with the addition of moving 
systems as well as additional pumps and top drives to the existing rig fleet 
to meet customer demand. 
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. Trinidad's 2013 capital program is 
expected to total between $70 million and $80 million. The capital program 
includes the completion of two contracted rigs for the Canadian operations 
carried over from the 2012 capital program, maintenance capital and select 
upgrade capital to improve the efficiency and marketability of specific 
existing equipment. 
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                      December 31, December 31,   THRESHOLD
                                   2012         2011                   
                                                                       

Consolidated Senior Debt        0.27:1       0.59:1     3.00:1 maximum 
to Consolidated EBITDA (1)

Consolidated Total Debt to      1.91:1       2.42:1     4.00:1 maximum 
Consolidated EBITDA (1)

Consolidated EBITDA to
Consolidated Cash Interest      6.76:1       5.74:1     2.75:1 minimum 
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

Looking forward into 2013 and beyond, Trinidad continues to see a level of 
volatility for commodity prices and global economic demand for oil and natural 
gas. What has become clearer is the increased awareness of the benefits of 
high-performance drilling equipment. Demand and pricing have remained 
relatively stable across North America for modern, high-performance equipment, 
while older style, conventional rigs have been more impacted by lower activity 
levels and weaker pricing.

Trinidad's largely high-specification fleet remains in demand; however, in 
order to maintain its position as a leader in the industry and to satisfy its 
customers' requests, the Company needs to continually upgrade its equipment. 
In 2013, Trinidad expects to focus its capital spending on adding automation 
and efficiency to its existing fleet. Trinidad expects to upgrade rigs by
    --  adding moving systems that will allow more rigs to walk between
        wells while pad drilling;
    --  adding automated pipe handling systems to rigs that don't have
        them;
    --  increasing mud pumping capacity to allow rigs to perform
        efficiently in a number of challenging plays across North
        America; and
    --  performing general upgrades to increase the performance and
        efficiency of the equipment.

These upgrades are typically done in conjunction with an extended contract and 
an increased day rate that allows Trinidad to recoup its capital investment. 
If market conditions warrant and contract terms meet the Company's internal 
hurdle rates, it may add a small number of new builds to its capital program 
in 2013.

Trinidad's strategy of growing EBITDA through selective growth opportunities 
and efficiently run operations while also paying down debt will continue in 
2013. The Company's long-term goal is to maintain a debt to EBITDA level of 
approximately 1.5 times and it is very close to achieving this goal. Over the 
past few years, Trinidad's ability to generate significant free cash flow has 
become a lot clearer. Achieving its capital structure target means the Company 
will be able to take advantage of more opportunities to add value for its 
shareholders going forward. These opportunities may take the form of growth in 
existing operations, new areas of development or international expansion 
opportunities. Looking further out, the Company sees added upside potential if 
some of the liquefied natural gas plants planned for the west coast of Canada 
are built or if natural gas prices strengthen. In addition, Trinidad will 
review other avenues for adding shareholder value and utilizing its growing 
level of free cash flow, such as dividend payments and share buy-back programs.

Trinidad expects that industry conditions will remain relatively stable in 
2013 with producers adjusting capital spending programs in relation to 
commodity price levels. The Company expects that its modern, high performance 
equipment will continue to be in demand but that unless commodity prices 
increase there will be limited demand for lower specification equipment.

With a high level of in-demand equipment and long-term contracts, a more 
diversified customer base and growing financial flexibility, Trinidad is well 
positioned to perform strongly and capitalize on opportunities for growth in 
2013 and beyond.

CONFERENCE CALL

A conference call and webcast to discuss the results will be held for the 
investment community on Thursday March 7(th), 2013 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 March 7(th), 2013 until midnight March 14(th), 
2013 by dialing (855) 859 2056 or (416) 849-0833 and entering replay access 
code 97019283.

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

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                                         December 31, December 31,

($ thousands)                                         2012         2011
                                                                       

Assets                                                                 

Current Assets                                                         

Cash and cash equivalents                            4,933            -

Accounts receivable                                182,071      207,143

Inventory                                            8,600       17,523

Prepaid expenses                                     4,808        6,298

Assets held for sale                                   816        9,048
                                                   201,228      240,012
                                                                       

Property and equipment                           1,253,921    1,279,826

Intangible assets and goodwill                      86,145       88,288
                                                 1,541,294    1,608,126
                                                                       

Liabilities                                                            

Current Liabilities                                                    

Bank indebtedness                                        -        4,600

Accounts payable and accrued liabilities            82,265       88,960

Dividends payable                                    6,043        6,043

Deferred revenue                                     2,891            -

Current portion of long-term debt                      617          580
                                                    91,816      100,183
                                                                       

Long-term debt                                     509,215      580,167

Deferred income taxes                               76,414       86,550
                                                   677,445      766,900
                                                                       

Shareholders' Equity                                                   

Common shares                                      952,043      952,043

Contributed surplus                                 50,245       49,462

Accumulated other comprehensive loss              (34,403)     (25,377)

Deficit                                          (104,036)    (134,902)
                                                   863,849      841,226
                                                 1,541,294    1,608,126
                                                                       


                                                                  

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(LOSS)

For the years ended December 31,                                  
                                                                  

($ thousands except per share data)                   2012    2011
                                                                  

Revenue                                                           

Oilfield service revenue                           859,133 817,005

Other revenue                                          194   1,145
                                                   859,327 818,150

Expenses                                                          

Operating expense                                  530,176 509,663

General and administrative                          57,545  61,150

Depreciation and amortization                      113,527 112,711

Foreign exchange                                     (753) (3,202)

Gain on sale of property and equipment            (11,841) (5,978)

Impairment of property and equipment                78,853   8,993
                                                   767,507 683,337

Finance costs                                       41,662  44,670

Earnings before income taxes                        50,158  90,143

Income taxes                                                      

Current                                              1,282   2,566

Deferred                                           (6,162)  11,096
                                                   (4,880)  13,662

Net earnings                                        55,038  76,481
                                                                  

Other comprehensive income (loss)                                 

  Foreign currency translation adjustment, net of  (9,026)   4,653
  income tax
                                                   (9,026)   4,653

Total comprehensive income                          46,012  81,134
                                                                  

Earnings per share                                                

Net earnings                                                      

  Basic / Diluted                                     0.46    0.63


                                                                     

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For years ended December 31, 2012 and 2011
                                     Accumulated                 
                                        other      Retained      


            Common  Contributed comprehensive  earnings   Total
($ thousands)   shares    surplus   income (loss)  (deficit)  equity 
                                     (1) 
Balance at
December 31,    952,043      49,462       (25,377) (134,902)  841,226
2011 
Share-based           -         783              -         -      783
payments 
Total
comprehensive         -           -        (9,026)    55,038   46,012
income (loss) 
Dividends             -           -              -  (24,172) (24,172) 
Balance at
December 31,    952,043      50,245       (34,403) (104,036)  863,849
2012 
                                                                  
Balance at      951,863      49,016       (30,030) (187,211)  783,638
January 1, 2011 
Exercise of         180        (48)              -         -      132
stock options 
Share-based           -         494              -         -      494
payments 
Total
comprehensive         -           -          4,653    76,481   81,134
income (loss) 
Dividends             -           -              -  (24,172) (24,172) 
Balance at
December 31,    952,043      49,462       (25,377) (134,902)  841,226
2011 


                                                                     

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

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the years ended December 31, 

($ thousands)                                            2012      2011
                                                                       

Cash provided by (used in)                                             

Operating activities                                                   

Net earnings                                           55,038    76,481

Adjustments for:                                                       

  Depreciation and amortization                       113,527   112,711

  Foreign exchange                                      (753)   (3,202)

  Gain on sale of property and equipment             (11,841)   (5,978)

  Impairment of property and equipment                 78,853     8,993

  Finance costs                                        41,662    44,670

  Income taxes                                        (4,880)    13,662

  Other                                                 5,398     5,091

  Income taxes paid                                   (4,491)   (7,928)

  Income taxes recovered                                4,640     2,580

  Interest paid                                      (41,924)  (29,439)

  Interest received                                        11        48

Funds provided by operations                          235,240   217,689

Change in non-cash operating working capital           23,765  (29,872)

Cash provided by operations                           259,005   187,817
                                                                       

Investing activities                                                   

Purchase of property and equipment                  (185,718) (182,206)

Proceeds from disposition of property and equipment    22,519    46,553

Change in non-cash working capital                        690   (3,746)

Cash used by investing                              (162,509) (139,399)
                                                                       

Financing activities                                                   

Proceeds from long-term debt                          170,555    91,263

Repayments of long-term debt                        (233,259) (129,474)

Proceeds from exercise of options                           -       130

Dividends paid                                       (24,172)  (24,171)

Financing costs                                         (373)   (1,587)

Cash used by financing                               (87,249)  (63,839)
                                                                       

Cash flow from operating, investing and financing       9,247  (15,421)
activities

Effect of translation of foreign currency cash            286     2,916

Increase (decrease) in cash for the year                9,533  (12,505)
                                                                       

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

Cash and cash equivalents (bank indebtedness) - end     4,933   (4,600)
of year
                                                                       



SEGMENTED INFORMATION

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

Three months                     United       Inter-                    
ended             Canadian     States /       segment                   
December 31,                                             Corporate   Total 
2012            Operations  International  Eliminations
 ($ thousands)                 Operations

Operating            77,577        118,398            -           -  195,975
revenue 

 Other revenue          120              8            -           -      128

 Third party          9,840          3,614            -           -   13,454
recovery 

 Inter-segment          124              -        (124)           -        -
revenue 
                     87,661        122,020        (124)           -  209,557

 Operating           47,308         71,037            -           -  118,345
costs 

 Third party          9,840          3,614            -           -   13,454
costs 

 Inter-segment          124              -        (124)           -        -
operating 

 Operating           30,389         47,369            -           -   77,758
income 

 Depreciation
and                   9,645         19,499            -           -   29,144
amortization 

 (Gain) loss on
sale of            (11,284)          (262)            -           - (11,546)
property and
equipment 

 Impairment of
property and          6,811         63,233            -           -   70,044  
equipment 
                      5,172         82,470            -           -   87,642

 Segmented           25,217       (35,101)            -           -  (9,884)
income 

 General and              -              -            -      15,903   15,903
administrative 

 Foreign                  -              -            -     (1,468)  (1,468)
exchange 

 Finance costs            -              -            -      10,076   10,076

 Income taxes             -              -            -    (22,149) (22,149)

 Net earnings        25,217       (35,101)            -     (2,362) (12,246)
(loss)
                                                                            

 Purchase of
property and         30,622          5,982            -           -   36,604
equipment 
                                                                            

Three months                     United       Inter-                    
ended             Canadian     States /       segment                   
December 31,                                             Corporate   Total 
2011            Operations  International  Eliminations
 ($ thousands)                 Operations

Operating            89,250        124,522            -           -  213,772
revenue 

 Other revenue          132           (19)            -           -      113

 Third party         12,909          4,312            -           -   17,221
recovery 

 Inter-segment       13,723              -     (13,723)           -        -
revenue 
                    116,014        128,815     (13,723)           -  231,106

 Operating           54,459         70,450            -           -  124,909

 Third party         12,909          4,312            -           -   17,221
costs 

 Inter-segment       13,723              -     (13,723)           -        -
operating 

 Operating           34,923         54,053            -           -   88,976
income 

 Depreciation
and                   9,061         20,055            -           -   29,116
amortization 

 (Gain) loss on
sale of               (435)          (127)            -           -    (562)
property and
equipment 

 Impairment of
property and              -              -            -           -        -
equipment 
                      8,626         19,928            -           -   28,554

 Segmented           26,297         34,125            -           -   60,422
(loss) income 

 General and              -              -            -      17,028   17,028
administrative 

 Foreign                  -              -            -       2,403    2,403
exchange 

 Finance costs            -              -            -      10,904   10,904

 Income taxes             -              -            -       4,769    4,769

 Net earnings        26,297         34,125            -    (35,104)   25,318
(loss)
                                                                            

 Purchase of
property and         10,838         55,360            -           -   66,198
equipment 
                                                                            

For the year                     United
ended                          States /       Inter- 
December 31,      Canadian                    segment                   
2012                        International                               
 ($ thousands)  Operations    Operations   Eliminations  Corporate   Total 

Operating           303,500        499,852            -           -  803,352
revenue 

 Other revenue          414          (220)            -           -      194

 Third party         37,539         18,242            -           -   55,781
recovery 

 Inter-segment        9,622              -      (9,622)           -        -
revenue 
                    351,075        517,874      (9,622)           -  859,327

 Operating          177,111        297,284            -           -  474,395
costs 

 Third party         37,539         18,242            -           -   55,781
costs 

 Inter-segment        9,622              -      (9,622)           -        -
operating 

 Operating          126,803        202,348            -           -  329,151
income 

 Depreciation
and                  35,017         78,510            -           -  113,527
amortization 

 (Gain) loss on
sale of            (11,060)          (781)            -           - (11,841)
property and
equipment 

 Impairment of
property and         14,058         64,795            -           -   78,853
equipment 
                     38,015        142,524            -           -  180,539

 Segmented           88,788         59,824            -           -  148,612
income 

 General and              -              -            -      57,545   57,545
administrative 

 Foreign                  -              -            -       (753)    (753)
exchange 

 Finance costs            -              -            -      41,662   41,662

 Income taxes             -              -            -     (4,880)  (4,880)

 Net earnings        88,788         59,824            -    (93,574)   55,038
(loss) 
                                                                            

 Purchase of
property and        119,005         66,713            -           -  185,718
equipment 
                                                                            

For the year                     United
ended                          States /       Inter- 
December 31,      Canadian                    segment                   
2011                        International                               
 ($ thousands)  Operations    Operations   Eliminations  Corporate   Total 

Operating           310,935        445,526            -           -  756,461
revenue 

 Other revenue          823            322            -           -    1,145

 Third party         43,767         16,777            -           -   60,544
recovery 

 Inter-segment       56,573              -     (56,573)           -        -
revenue 
                    412,098        462,625     (56,573)           -  818,150

 Operating          188,695        260,424            -           -  449,119
costs 

 Third party         43,767         16,777            -           -   60,544
costs 

 Inter-segment       56,573              -     (56,573)           -        -
operating 

 Operating          123,063        185,424            -           -  308,487
income 

 Depreciation
and                  35,583         77,128            -           -  112,711
amortization 

 (Gain) loss on
sale of             (4,597)        (1,381)            -           -  (5,978)
property and
equipment 

 Impairment of
property and          1,535          7,458            -           -    8,993
equipment 
                     32,521         83,205            -           -  115,726

 Segmented           90,542        102,219            -           -  192,761
income 

 General and              -              -            -      61,150   61,150
administrative 

 Foreign                  -              -            -     (3,202)  (3,202)
exchange 

 Finance costs            -              -            -      44,670   44,670

 Income taxes             -              -            -      13,662   13,662

 Net earnings        90,542        102,219            -   (116,280)   76,481
(loss) 
                                                                            

 Purchase of
property and         42,966        139,240            -           -  182,206
equipment 
                                                                            

ADVISORY

CHANGE IN PRESENTATION

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 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.

CHANGES IN ACCOUNTING POLICY

Effective December 31, 2012, Trinidad adopted IFRS 11 - Joint Arrangements. 
Due to this adoption, Trinidad reviewed the assessment of whether control 
exists in relation to certain barge rigs operated through a charter agreement. 
Trinidad has determined that a joint arrangement exists based on the venturers 
meeting the joint control definition per the standard over the operations of 
the barge rigs included in this joint agreement. As a joint arrangement under 
IFRS 11, Trinidad recognized their portion of operations related to the joint 
arrangement in their respective accounts.

Additionally, in accordance with the requirements of early application of IFRS 
11, Trinidad has early adopted IFRS 10 - Consolidated Financial Statements and 
IFRS 12 - Disclosures of interests in other entities. There were no material 
changes related to the implementation of IFRS 10 and IFRS 12.

All changes have been applied retrospectively. Refer to the investor relations 
page of Trinidad's website www.trinidaddrilling.com for detailed disclosure of 
changes for prior periods.

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 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:

"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).

ADDITIONAL GAAP MEASURES DEFINITIONS

The Company uses certain additional GAAP financial measures within the 
financial statements and document that are not defined terms under IFRS to 
assess performance. Management believes that these measures provide useful 
supplemental information to investors. These financial measures are computed 
on a consistent basis for each reporting period and include Funds provided by 
operations, Operating income, Operating income percentage and Operating income 
- net percentage. These additional GAAP measures are identified and defined as 
follows:

"Funds provided by operations" is used by management and investors to analyze 
the funds generated by Trinidad's principal business activities prior to 
consideration of working capital. This balance is reported in the Consolidated 
Statements of Cash Flows included in the cash provided by operating activities 
section.

"Operating income" is used by management and investors to analyze overall and 
segmented operating performance. Operating income is not intended to 
represent an alternative to net earnings or other measures of financial 
performance calculated in accordance with IFRS. Operating income is 
calculated from the consolidated statements of operations and comprehensive 
income (loss) and from the segmented information contained in the notes to the 
consolidated financial statements. Operating income is defined as revenue less 
operating expenses.

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

"Operating income - net percentage" is used by management and investors to 
analyze overall and segmented operating performance. Operating income - 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 financial statements. Operating income - net percentage is 
defined as operating income divided by revenue net of third party costs.

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 (403) 294-4401 
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/March2013/06/c9294.html

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

-0- Mar/07/2013 02:00 GMT