Black Diamond Group Limited Reports Results for the Fourth Quarter and Year Ended December 31, 2012

Black Diamond Group Limited Reports Results for the Fourth Quarter and Year 
Ended December 31, 2012 
CALGARY, ALBERTA -- (Marketwire) -- 03/12/13 -- Black Diamond Group
Limited  (TSX:BDI) ("Black Diamond" or the "Company") is pleased to
announce its financial and operational results for the three months
and year ended December 31, 2012. 
HIGHLIGHTS - FOURTH QUARTER 2012  
Black Diamond's strategic growth and diversification over the past
several years has resulted in revenue generation in the fourth
quarter 2012 of $68.4 million with EBITDA of $27.9 million for the
period, compared to revenue of $66.2 million and EBITDA of $25.5
million for the same period in 2011.  
Rental revenue generated was $32.6 million, 28% higher than the prior
year's comparable period due to the growth of the modular structures
and oilfield service rental equipment. Non-rental revenue was $26.7
million and lodging revenue was $9.1 million, both off slightly from
the same period in the prior year as a result of decreased capacity
at Sunday Creek Lodge during the expansion activities completed
during the quarter. 
EBITDA margin of 41% for the quarter was up from 39% generated in the
same period in the prior year. This is a result of a higher
proportion of revenue coming from rental activity. Highlights from
each of the operating divisions for the fourth quarter are as
follows: 
Camps Division:  
The Camps division ended the quarter with 2,825 units in the rental
fleet which averaged 91% utilization for the period. The division
generated $28.4 million in revenue compared to $22.8 million in the
same quarter of 2011 primarily due to a 44% increase in rental
revenue. The 44% increase in rental revenue for the quarter is
predominantly derived from the 41% increase in the fleet size,
consisting of 819 units added since December 31, 2011. There was also
an increase in average rental rates.  
EBITDA generated for the quarter was $19.9 million or 58% higher than
the same period in the prior year. 
Logistics Division: 
The Logistics division ended the quarter with a 2,755 bed count. The
division generated $15.3 million in revenue compared to $14.8 million
in the same quarter of 2011 primarily as a result of increases in
non-rental revenue. Non-rental revenue increased by 78% from the same
quarter in 2011, which reflects the increase in operational activity
associated with the deployment of several substantial projects during
the quarter. 
Lodging revenue decreased by 19% in the quarter compared to 2011 due
to the expansion at Sunday Creek Lodge, which temporarily decreased
the number of beds available for occupancy throughout the quarter.  
The EBITDA margin decreased to 24% in the quarter from 42% in the
same period in the prior year as a direct result of non-rental
revenues making up a larger proportion of total revenue. Non-rental
revenue produces lower margins than lodging revenue. 
BOXX Modular Division: 
The BOXX Modular division ended the quarter with 3,109 units in the
rental fleet which averaged 84% utilization. The division generated
$15.8 million in revenue, a minimal increase from $15.5 million in
the same quarter of 2011. Non-rental revenue decreased slightly as a
result of fewer sales of manufactured units. This was offset by a 45%
increase in rental revenue to $7.4 million, up from $5.1 million in
the same period in the prior year. The increase in rental revenue as
a proportion of total revenue had a direct positive effect on the
EBITDA margin. EBITDA increased from $4.6 million in the fourth
quarter of 2011 to $6.2 million in 2012. 
Energy Services Division: 
The Energy Services division ended the quarter with 2,306 units in
the surface rental fleet which averaged 41% utilization for the
period, and 270 units in the drilling accommodations fleet which
averaged 64% utilization for the period. The division generated $8.9
million in revenue compared to $13.1 million in the same quarter of
2011. Rental revenue decreased by 18% due to some equipment being
reserved for use at customers' sites and unavailable for rent and an
overall decline in drilling activity over the comparative period.
Non-rental revenue decreased in the quarter due to a substantial
decrease in sales over the same period in the prior year. 
HIGHLIGHTS- YEAR ENDED DECEMBER 31, 2012 
Revenue levels for the year ended December 31, 2012 increased by 9%
to $264.3 million compared to the year ended December 31, 2011.
Rental revenue was 33% higher at $110.5 million compared to 2011,
while Non-rental revenue was 7% lower at $101.5 million, and lodging
revenue was 7% higher at $52.3 million. 
One of the primary drivers of Black Diamond's business continues to
be the rental revenue from fleet units. The significant investment in
fleet and operated facilities has resulted in a 33% or $27.1 million
increase in rental revenue in 2012 compared to 2011 and will
translate into strengthening results in 2013. The fleet of Camps
units grew by 41% or 819 units between December 31, 2011 and December
31, 2012. Over the same period, the BOXX Modular fleet grew by 16% or
420 units, Energy Services accommodations fleet grew by 22% or 48
units, and the number of surface rental pieces of equipment increased
8 units, from 2,298 units to 2,306 units. 
The utilization of these fleet assets remained strong throughout 2012
averaging 93% for Camps equipment compared with 93% for 2011. BOXX
Modular fleet utilization increased slightly to 80% in 2012 as
compared to 75% in 2011. Within Energy Services, the drilling
accommodations and surface rental equipment utilization rates were
67% and 44% respectively in 2012, compared to 45% and 46% in 2011.  
The Company's business activities continue to be concentrated on the
resource sector with approximately 82% of total revenue generated by
oil and gas related companies in western Canada, including oilsands
projects representing 38% of total revenue. Revenue generated from
non-oil and gas sectors include 8% relating to mining and metal
extraction and the balance of 10% generated from business not
directly related to the resource sector.  
Net income for 2012 was $47.4 million compared to $41.0 million for
2011. 
Camps Division: 
This division generated $89.1 million in revenue for the year as
compared to $76.2 million in 2011. Rental revenue was $62.9 million
for the year, a 38% increase from $45.6 million in 2011. 
The decrease in non-rental revenue in 2012 compared with 2011 from
$30.7 million to $26.2 million was due to a decrease in used fleet
sales in 2012. 
The increase in EBITDA margin from 62% in 2011 to 71% in 2012 was a
direct result of the relative increase of rental revenue versus other
revenue streams compared to 2011. 
Logistics Division: 
Revenue for this division increased from $67.0 million in 2011 to
$80.9 million in 2012 as a result of increases in non-rental revenue.
Non-rental revenue in the year increased 59% over 2011 with the
deployment of several substantial projects in the year. 
Lodging revenue increased by 7% in 2012 from 2011 due to higher bed
counts at operated camps.  
EBITDA margin decreased to 30% in 2012 compared to 33% in 2011as a
direct result of non-rental revenues making up a larger proportion of
total revenue.  
BOXX Modular Division: 
Revenue generated for the BOXX Modular division was $56.5 million
compared to $61.6 million in the prior year as a result of a 26%
decrease in non-rental activity which was a result of lower
manufactured sales in 2012 as compared to 2011. This was offset by a
30% increase in rental revenue in the year to $25.6 million, up from
$19.7 million in 2011, with a 16%, or 420 unit increase in the rental
fleet year over year. The increase in rental revenue as a percentage
of the total revenue had a direct positive effect on the EBITDA
margin.  
Energy Services Division: 
Revenue for this division increased minimally in 2012 to $37.8
million compared with $37.1 million in 2011. Rental revenue increased
by 22% to $21.9 million in 2012 primarily due to fleet additions. The
drilling accommodations fleet increased by 22%. This total includes
drill camps as well as a complement of wellsite units, free standing
sleepers and support units. Non-rental revenue decreased in 2012 to
$15.9 million due to a substantial decrease in used fleet sales over
2011. 
DIVIDENDS 
The Company paid dividends of $0.055 per share per month in January
through April 2012 and paid dividends of $0.060 per share per month
in May through December 2012 resulting in a payout ratio for 2012 of
27% compared to 22% for 2011. The Board of Directors of Black Diamond
is confident that the cash generated from operations will be
sufficient to meet the dividend obligations in the foreseeable
future. 
OUTLOOK 
Management is pleased with the Company's year end results and
anticipates that, despite general weakness in drilling related
activity in western Canada, the results for the first quarter of 2013
will be significantly stronger than the comparative period in 2012
for a number of reasons: 


 
--  the significant investment in fleet and operated facilities is expected
    to translate into strengthening results in 2013; 
--  the focus on remote workforce accommodation and long-term contracts is
    expected to mitigate and offset any negative impact of general weakness
    in drilling related activity in western Canada; 
--  the Company recognized initial revenues from its Australian acquisitions
    starting January 1, 2013; and 
--  Sunday Creek Lodge came fully back on-stream in January 2013 after a
    major retrofit and capacity expansion completed in Q4 2012. 

 
Approximately $40 million of the Company's $90 million 2013 capital
expenditure budget has been committed to date. This capital
expenditure includes the initial acquisition of fleet assets from
Nomad Building Solutions Limited, the acquisition of 116 additional
Nomad fleet units and acquisition of the remaining 10% of the modular
rental business of Australian Portable Buildings Pty. Ltd. ("APB")
not already indirectly owned by the Company. The capital committed to
date does not include the initial acquisition of 90% of the modular
rental business of APB for $42.59 million. 
In summary, the Company's operations continue to be extremely healthy
and management fully anticipates robust results as the Company moves
forward through 2013. The strength of the Company's business has led
the Board of Directors to approve a 17% increase in the Company's
monthly dividend from $0.06 to $0.07 per month, which will take
effect in March 2013, for payment to shareholders in April 2013. 
SUMMARY FINANCIAL STATEMENTS 
The following is a summary of the Company's Consolidated Statement of
Financial Position as at December 31, 2012 and 2011, and the
Company's Consolidated Statements of Net Income and Cash Flows for
the years ended December 31, 2012 and 2011. These summary statements
should be read in conjunction with the Company's consolidated
financial statements including the accompanying notes for years ended
December 31, 2012 and 2011 as filed on SEDAR.  


 
CONSOLIDATED STATEMENT OF FINANCIAL POSITION                                
                                                          as at December 31,
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(Expressed in thousands)                                    2012        2011
As at                                                                       
                                                       ---------------------
                                                               $           $
                                                       ---------------------
ASSETS                                                                      
Current                                                                     
Cash and cash equivalents                                  2,697     22,990 
Trade and accrued receivables                             76,578     47,641 
Due from related parties                                     121      1,313 
Prepaid expenses and other current assets                  7,477      8,066 
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                                                          86,873     80,010 
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Non-Current                                                                 
Long term receivables                                      2,708          - 
Property and equipment                                   423,281    301,073 
Intangible assets                                          9,757     10,690 
Goodwill                                                  34,577     34,657 
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                                                         557,196    426,430 
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LIABILITIES AND SHAREHOLDERS' EQUITY                                        
Current                                                                     
Accounts payable and accrued liabilities                  39,486     24,788 
Due to related parties                                     1,174      1,415 
Dividends payable                                          2,472      1,771 
Income taxes payable                                       8,524         44 
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                                                          51,656     28,018 
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Non-Current                                                                 
Long-term debt                                            96,359     86,130 
Risk management liability                                  1,324      2,074 
Asset retirement obligations                               1,955      1,907 
Deferred income taxes                                     44,821     38,892 
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                                                         196,115    157,021 
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Shareholders' equity                                                        
Share capital                                            309,140    240,350 
Contributed surplus                                        4,431      4,778 
Non-controlling interest                                   5,274      1,359 
Accumulated other comprehensive loss                      (3,285)    (2,889)
Retained earnings                                         45,521     25,811 
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                                                         361,081    269,409 
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                                                         557,196    426,430 
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CONSOLIDATED STATEMENT OF NET INCOME                                        
                                            for the years ended December 31,
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(Expressed in thousands, except per share amounts)                          
                                                                            
                                                              2012      2011
                                                        --------------------
                                                                 $         $
                                                        --------------------
Revenue                                                    264,274   241,808
                                                                            
Direct costs                                               118,386   119,485
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Gross Profit                                               145,888   122,323
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Expenses                                                                    
Administrative expenses                                     37,861    30,102
Depreciation of property and equipment                      34,665    27,285
Amortization of intangibles                                    879     1,415
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                                                            73,405    58,802
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Operating profit                                            72,483    63,521
                                                                            
Finance costs                                                5,747     4,884
                                                                            
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Income before income taxes                                  66,736    58,637
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Income tax                                                                  
Current                                                      8,520        60
Deferred                                                     7,061    13,996
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                                                            15,581    14,056
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Net income                                                  51,155    44,581
                                                                            
Net income attributable to non-controlling interest          3,761     3,602
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Net income attributable to Black Diamond Group Limited      47,394    40,979
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Net income per share                                                        
Basic                                                         1.21      1.15
Diluted                                                       1.18      1.12
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CONSOLIDATED STATEMENT OF CASH FLOWS                                        
                                           for the years ended December 31, 
(Expressed in thousands)                                                    
                                                    Year ended December 31, 
                                                             2012      2011 
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                                                                $         $ 
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Operating activities                                                        
Net Income attributable to Black Diamond Group Limited     47,394    40,979 
Add (deduct) non-cash items:                                                
 Depreciation of property and equipment                    34,665    27,285 
 Amortization of intangible assets                            879     1,415 
 Net income attributable to non-controlling interest        3,761     3,602 
 Unrealized foreign exchange loss                              36         7 
 Finance costs                                              5,747     4,884 
 Deferred income taxes                                      7,061    13,996 
 Share-based compensation expense                           3,321     1,843 
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                                                          102,864    94,011 
Book value of used fleet sales in operating activities      6,817    14,171 
Change in long-term receivables                            (2,708)        - 
Change in non-cash working capital related to operating                     
 activities                                                (3,458)  (39,378)
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Net cash from operating activities                        103,515    68,804 
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Investing activities                                                        
Purchase of property and equipment                       (163,628)  (94,656)
Increase in other non-current asset                             -           
Change in non-cash working capital related to investing                     
 activities                                                  (404)    9,506 
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Net cash used in investing activities                    (164,032)  (85,150)
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Financing activities                                                        
Proceeds from long-term debt                               10,000    62,000 
Repayment of long-term debt                                     -   (41,000)
Costs of long-term debt issuance and refinancing              (97)     (949)
Repayment of finance lease                                      -      (561)
Interest in the year                                       (5,470)   (4,765)
Net proceeds from issuance of shares                       57,465    48,772 
Dividend payments                                         (26,983)  (20,138)
Distribution to non-controlling interest                   (1,218)   (1,451)
Purchase of shares in trust                                  (993)     (220)
Sale of shares in trust                                       206       206 
Bank indebtedness                                               -    (6,776)
Share options exercised                                     7,587     1,655 
Change in non-cash working capital related to financing                     
 activities                                                  (241)    2,573 
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Net cash from financing activities                         40,256    39,346 
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Increase/ (decrease) in cash and cash equivalents         (20,261)   23,000 
Cash and cash equivalents, beginning of year               22,990         - 
Effect of foreign currency rate changes on cash and cash                    
 equivalents                                                  (32)      (10)
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Cash and cash equivalents, end of year                      2,697    22,990 
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Additional Information 
A copy of the Company's audited consolidated financial statements for
the years ended December 31, 2012 and 2011 along with the related
management's discussion and analysis have been filed with the
Canadian securities regulatory authorities and may be accessed
through the SEDAR website (www.sedar.com). 
Conference Call 
Black Diamond will host a conference call for analysts, investors and
interested parties to discuss its financial and operational results
at 4:30 p.m. MST on March 12, 2013. Trevor Haynes, President and
Chief Executive Officer, and Michael Burnyeat, Executive Vice
President and Chief Financial Officer, will be in attendance. The
call can be accessed by calling 416-340-2217 or toll free
1-866-696-5910 prior to the scheduled start time. Digital playback of
the conference call will be available on the Company's website. 
About Black Diamond  
Founded in 2003, Black Diamond Group Limited is one of the fastest
growing remote lodging, modular building and energy services
companies worldwide. With its corporate head office located in
Calgary, Alberta, Black Diamond provides world-class services to a
full spectrum of industries including oil and gas, mining, power,
construction, engineering, military, government and education. 
Through its direct and indirect wholly-owned subsidiaries and its
approximate 50% equity participation in certain aboriginal limited
partnerships, Black Diamond operates four complementary business
units in seventeen strategic locations across Canada, the United
States and Australia.  
Black Diamond Structures rents and sells remote workforce housing and
modular workspace solutions and provides associated services; Black
Diamond Logistics provides turnkey lodging services, remote facility
management and supply chain solutions; Black Diamond Energy Services
rents and sells a complement of oilfield equipment and services and
Black Diamond International rents and sells remote workforce housing
and modular workspace solutions and provides associated services
outside of North America. 
Reader Advisory 
Certain information in this news release contains forward-looking
statements including management's assessment of future plans and
operations of Black Diamond and statements relating to future
operational and financial results and dividend levels. These
forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond Black Diamond's control
including, without limitation, the impact of general economic
conditions, industry conditions, fluctuation of commodity prices,
fluctuation of exchange rates, environmental risks, industry
competition, availability of qualified personnel and management,
stock market volatility, timely and cost effective access to
sufficient capital from internal and external sources. As a
consequence, actual results may differ materially from those
anticipated in the forward-looking statements. Readers are cautioned
that the forgoing list of factors is not exhaustive. Additional
information on these and other factors that could affect Black
Diamond's operations and financial results are included in reports on
file with Canadian securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com) and at Black
Diamond's website (www.blackdiamondlimited.com). Furthermore, the
forward-looking statements contained in this news release are made as
at the date of this news release and Black Diamond does not undertake
any obligation to update publicly or to revise any of the
forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required by applicable
securities laws. 
In this news release, the following terms have been referenced:
EBITDA (earnings before interest, taxation, depreciation and
amortization) and payout ratio. Readers are cautioned that these
measures are not defined under Canadian Generally Accepted accounting
Principles ("GAPP"). Readers are cautioned that these non-GAAP
measures are not alternatives to measures under GAAP and should not,
on their own, be construed as an indicator of the Company's
performance or cash flows, a measure of liquidity or as a measure of
actual return on the common shares of the Company. These Non-GAAP
measures should only be used in conjunction with the consolidated
financial statements of the Company. A reconciliation between these
measures and measures defined under GAAP is included in management's
discussion and analysis for the three months and year ended December
31, 2011 filed on SEDAR.
Contacts:
Black Diamond Group Limited
Trevor Haynes
President and Chief Executive Officer
(403) 206-4737
(403) 264-9281 (FAX) 
Black Diamond Group Limited
Michael Burnyeat
Executive Vice President and Chief Financial Officer
(403) 206-4740
(403) 264-9281 (FAX)
www.blackdiamondlimited.com