Trican Reports First Quarter Results for 2013

Trican Reports First Quarter Results for 2013 
CALGARY, ALBERTA -- (Marketwired) -- 05/08/13 -- Trican Well Service
Ltd. (TSX:TCW) 


 
                                            --------------------------------
                                                   Three months ended       
(millions, except per share amounts;         March 31,  March 31,  Dec. 31, 
 unaudited)                                       2013       2012      2012 
----------------------------------------------------------------------------
Revenue                                         $618.4     $716.4    $485.9 
Operating income (i)                              86.7      161.8      35.1 
Net income (loss)                                 25.2       89.5      (7.7)
Net income (loss) per share          (basic)     $0.17      $0.61    ($0.05)
                                   (diluted)     $0.17      $0.61    ($0.05)
Adjusted net income (loss) (i)                    27.4       92.3      (5.4)
Adjusted net income (loss) per                                              
 share(i)                            (basic)     $0.18      $0.63     (0.04)
                                   (diluted)     $0.18      $0.63     (0.04)
Funds provided by (used in)                                                 
 operations(i)                                    58.0      141.5     (14.3)
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Notes:  
(i) Trican makes reference to operating income, adjusted net income
(loss) and funds provided by (used in) operations. These are measures
that are not recognized under International Financial Reporting
Standards (IFRS). Management believes that, in addition to net income
(loss), operating income, adjusted net income (loss) and funds
provided by (used in) operations are useful supplemental measures.
Operating income provides investors with an indication of net income
(loss) before depreciation and amortization, foreign exchange gains
and losses, other income, finance costs and income tax expense.
Adjusted net income (loss) provides investors with information on net
income (loss) excluding one-time non-cash charges and the non-cash
effect of stock-based compensation expense. Funds provided by (used
in) operations provide investors with an indication of cash available
for capital commitments, debt repayments and other expenditures.
Investors should be cautioned that operating income, adjusted net
income (loss), and funds provided by (used in) operations should not
be construed as an alternative to net income (loss) and cash provided
(used in) operations determined in accordance with IFRS as an
indicator of Trican's performance. Trican's method of calculating
operating income, adjusted net income (loss) and funds provided by
(used in) operations may differ from that of other companies and
accordingly may not be comparable to measures used by other
companies. 
FIRST QUARTER HIGHLIGHTS 
Consolidated revenue for the first quarter of 2013 was $618.4
million, a decrease of 14% compared to the first quarter of 2012.
Consolidated net income was $25.2 million compared to net income of
$89.5 million, and diluted income per share was $0.17 compared to
diluted income per share of $0.61 for the same period in 2012. Funds
provided by operations were $58.0 million compared to $141.5 million
in the first quarter of 2012.  
Our Canadian operations generated quarterly revenue of $338.6 million
and operating income of $89.8 million during the first quarter of
2013. Canadian revenue decreased by 22% and operating income
decreased by 44% compared to the first quarter of 2012. The majority
of the year-over-year decreases in revenue and operating income were
caused by a 19% decline in Canadian pricing. Canadian activity levels
were relatively strong in the first quarter as the number of wells
drilled increased by 4% compared to the first quarter of 2012 and by
31% compared to the fourth quarter. The substantial increase in first
quarter Canadian activity compared to the fourth quarter of 2012 led
to sequential increases in revenue of 39% and operating income of 76%
for our Canadian operations. 
Our U.S. operations generated first quarter revenue of $210.7 million
and operating income of $18.0 million. U.S. revenue increased by 21%
compared to the fourth quarter of 2012 due largely to a 25% increase
in equipment utilization. First quarter utilization for our U.S.
operations benefited from Trican's technology offering. Our U.S.
operations were able to secure work in the first quarter through key
technology offerings such as our BPS Completion Tool and water
recycling services. U.S. operating margins improved by 970 basis
points on a sequential basis due to increased utilization, lower guar
costs, and progress made on cost cutting initiatives. U.S. revenue
decreased by 4% compared to the first quarter of 2012 as a 9%
year-over-year decline in pricing was partially offset by increased
activity for our cementing and coiled tubing service lines. 
First quarter revenue for our International operations was $70.1
million and the operating loss was $2.1 million. International
revenue and operating income were below our expectations due largely
to operational delays for several of our Russian customers. We expect
our Russian customers to increase activity levels and that most of
the lost revenue in the first quarter will be recovered over the
remainder of 2013. 
Senior Management Changes 
We are pleased to announce that James (Jim) McKee will be joining
Trican effective May 14, 2013 as Senior Vice President, Corporate
Development. Jim has over 30 years of experience in oilfield
services, investment banking, and public accounting  industries and
will be a tremendous asset to our Trican team. Jim will be replacing
David Jones who will be moving to Cyprus to take on the role of Vice
President, EAME and CIS. 
We are also pleased to announce that Michael Baldwin has been
promoted to Senior Vice President, Finance and CFO effective May 14,
2013. Michael has 20 years of oilfield services and accounting
experience and has been a key member of the executive team since he
re-joined Trican in November 2008 as Vice President, Finance and CFO. 
MANAGEMENT'S DISCUSSION AND ANALYSIS 


 
COMPARATIVE QUARTERLY INCOME STATEMENTS ($ thousands, unaudited)            
----------------------------------------------------------------------------
                                                                            
                                                          Quarter-          
                                                             Over-          
Three months ended              % of               % of    Quarter       %  
 March 31,             2013  Revenue      2012  Revenue     Change  Change  
----------------------------------------------------------------------------
                                                                            
Revenue             618,376    100.0%  716,356    100.0%   (97,980)  (13.7%)
Expenses                                                                    
  Materials and                                                             
   operating        502,026     81.2%  527,546     73.6%   (25,520)   (4.8%)
  General and                                                               
   administrative    29,680      4.8%   26,965      3.8%     2,715    10.1% 
----------------------------------------------------------------------------
Operating income(i)  86,670     14.0%  161,845     22.6%   (75,175)  (46.4%)
  Finance costs       8,488      1.4%    7,035      1.0%     1,453    20.7% 
  Depreciation and                                                          
   amortization      47,059      7.6%   35,832      5.0%    11,227    31.3% 
  Foreign exchange                                                          
   gain              (1,726)    (0.3%)    (694)    (0.1%)   (1,032)  148.7% 
  Other income       (2,070)    (0.3%)  (1,346)    (0.2%)     (724)   53.8% 
----------------------------------------------------------------------------
Income before                                                               
 income taxes        34,919      5.6%  121,018     16.9%   (86,099)  (71.1%)
Income tax expense    9,727      1.6%   31,636      4.4%   (21,909)  (69.3% 
----------------------------------------------------------------------------
Net Income           25,192      4.1%   89,382     12.5%   (64,190)  (71.8%)
----------------------------------------------------------------------------
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(i) see first page of this report 
CANADIAN OPERATIONS  


 
----------------------------------------------------------------------------
($ thousands, except                                                        
 revenue per job,                                                           
 unaudited)                                                                 
                     March 31,    % of March 31,    % of   Dec. 31,    % of 
Three months ended,       2013 Revenue      2012 Revenue       2012 Revenue 
----------------------------------------------------------------------------
Revenue                338,649           433,111            244,237         
Expenses                                                                    
  Materials and                                                             
   operating           241,473    71.3%  265,966    61.4%   187,313    76.7%
  General and                                                               
   administrative        7,376     2.2%    8,135     1.9%     5,897     2.4%
                     ---------         ---------         -----------        
  Total expenses       248,849    73.5%  274,101    63.3%   193,210    79.1%
Operating income(i)     89,800    26.5%  159,010    36.7%    51,027    20.9%
Number of jobs           6,955             7,153              5,572         
Revenue per job         48,280            60,353             43,545         
----------------------------------------------------------------------------
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(i) see first page of this report  
Sales Mix 


 
----------------------------------------------------------------------------
Three months ended,                      March 31,    March 31,     Dec. 31,
(unaudited)                                   2013         2012         2012
----------------------------------------------------------------------------
% of Total Revenue                                                          
Fracturing                                     64%          70%          61%
Cementing                                      20%          17%          21%
Nitrogen                                        7%           7%           6%
Coiled Tubing                                   4%           3%           5%
Acidizing                                       3%           2%           3%
Other                                           2%           1%           4%
----------------------------------------------------------------------------
Total                                         100%         100%         100%
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
Operations Review  
Canadian drilling activity levels in the first quarter of 2013, were
strong as the number of wells drilled in the Western Canadian
Sedimentary Basin ("WCSB") increased by 4% compared to the first
quarter of 2012, and by 31% compared to the fourth quarter of
2012(1). Our cementing service line tracks closely with drilling
activity and cementing jobs completed by Trican in the first quarter
increased by 8% year-over-year and 30% sequentially.  
(1) Wells drilled data obtained from JuneWarren-Nickle's Energy Group 
Compared to the first quarter of 2012, the increase in cementing
activity was more than offset by a decrease in fracturing activity.
Fracturing job count decreased by 25% on a year-over-year basis due
to lower utilization combined with larger fracturing job sizes.
Fracturing utilization was weak at the start of the quarter as there
was not a backlog of wells to be fractured due to the slowdown in the
back half of the fourth quarter. Utilization increased in February to
peak levels and carried into March due to breakup being delayed.
Fracturing stages completed per well increased by 15% and the average
amount of sand pumped per job increased by 27% compared to the first
quarter of 2012. These factors led to larger jobs sizes and required
our fracturing crews to be on location for a longer period of time,
which contributed to the decrease in fracturing jobs performed
compared to the first quarter of 2012.  
Overall pricing for our Canadian operations decreased by 6.5%
compared to the fourth quarter of 2012. Pricing is down 19% from peak
pricing levels seen in the first quarter of 2012. We saw a
significant decline in coiled tubing, nitrogen and acidizing prices,
a decrease in fracturing prices, and flat cementing prices during the
quarter. Most pricing arrangements were negotiated late in 2012 and
were carried into the quarter. Spot market pricing in the quarter was
relatively stable for fracturing and cementing.  
We saw continued acceptance of our MVP fracturing fluid system in
Canada during the first quarter of 2013. Our Canadian operations
fractured over 350 stages using the MVP system during the first
quarter compared to approximately 300 stages fractured using the
system for all of 2012.  
This was the first quarter of operations for i-TEC AS and its
subsidiaries (collectively referred to as "i-TEC") in Canada. We are
currently integrating this division into our Canadian operations and,
as a result, i-TEC operations did not have a meaningful impact on our
first quarter Canadian results. We will continue to focus on
establishing a market presence for i-TEC and our Canadian completion
tools division throughout the remainder of 2013.  
Q1 2013 versus Q1 2012 
Canadian revenue decreased by 22% on a year-over-year basis. Revenue
per job decreased by 20% due largely to a 19% decrease in pricing
combined with a decrease in fracturing revenue relative to total
revenue. These factors were partially offset by larger fracturing job
sizes performed during the first quarter of 2013. The job count
decreased by 3% as an increase in cementing jobs was more than offset
by a decrease in fracturing, nitrogen and acidizing jobs. 
As a percentage of revenue, materials and operating expenses
increased to 71.3% from 61.4% due largely to the decrease in pricing.
Lower pricing resulted in decreased operational leverage on our fixed
costs. In addition, certain significant variable costs, such as
repairs and maintenance and variable compensation paid to operational
employees did not decrease to the same extent as pricing given that
activity levels remained relatively strong in the first quarter.
These factors were partially offset by a decrease in product costs.
General and administrative expenses decreased by $0.8 million due
primarily to lower profit sharing expenses.  
Q1 2013 versus Q4 2012 
Sequentially, Canadian revenue increased by 39%. The job count
increased by 25% and compares to the 31% sequential increase in wells
drilled in the WCSB during the first quarter of 2013. Fracturing jobs
increased by only 22% as larger job sizes required our fracturing
crews to be on location for a longer period of time, which
contributed to the shortfall relative to the increase in industry
activity levels.   
Revenue per job increased by 11% due to an increase in fracturing job
size combined with a larger portion of fracturing revenue relative to
total revenue. These factors were partially offset by a 6.5% decline
in pricing.  
As a percentage of revenue, materials and operating expenses
decreased to 71.3% from 76.7%. Increased operational leverage on our
fixed cost structure led to improved operating margins, which was
offset partially by the decrease in pricing. General and
administrative costs increased by $1.5 million due to an increase in
share based compensation.  
UNITED STATES OPERATIONS  


 
----------------------------------------------------------------------------
($ thousands, except                                                        
 revenue per job,                                                           
 unaudited)                                                                 
                     March 31,    % of March 31,    % of  Dec. 31,    % of  
Three months ended,       2013 Revenue      2012 Revenue      2012 Revenue  
----------------------------------------------------------------------------
Revenue                210,685           218,536           173,589          
Expenses(i)                                                                 
  Materials and                                                             
   operating           186,213    88.4%  192,170    88.0%  171,140    98.6% 
  General and                                                               
   administrative        6,483     3.1%    4,662     2.1%    4,553     2.6% 
                     ---------         ---------         ----------         
  Total expenses       192,696    91.5%  196,832    90.1%  175,693   101.2% 
Operating income                                                            
 (loss)(ii)             17,989     8.5%   21,704     9.9%   (2,104)   (1.2%)
Number of jobs           2,035             1,680             1,654          
Revenue per job        103,696           130,499           105,077          
----------------------------------------------------------------------------
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(i) certain prior period expenses have been reclassified from
materials and operating to general and administrative to conform to
current period classification   
(ii) see first page of this report  
Sales Mix 


 
----------------------------------------------------------------------------
Three months ended,                     March 31,    March 31,     Dec. 31, 
(unaudited)                                  2013         2012         2012 
----------------------------------------------------------------------------
% of Total Revenue                                                          
Fracturing                                     92%          96%          90%
Cementing                                       6%           2%           7%
Coil Tubing                                     2%           2%           3%
----------------------------------------------------------------------------
Total                                         100%         100%         100%
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
Operations Review 
First quarter U.S. activity levels were down year-over-year but
steady relative to the fourth quarter of 2012 as U.S. rig count
decreased by 12% year-over-year and was effectively unchanged,
sequentially. Despite the sluggish industry activity levels, first
quarter utilization for our U.S. operations was up 25%, sequentially.
Trican's technology provided access to new U.S. customers and
contributed to the increase in utilization. Our U.S. operations were
able to secure work in the first quarter through key technology
offerings such as our BPS Completion Tool and water recycling
services. We will continue to focus on marketing existing
technologies and developing new technologies to meet the needs of our
U.S. customers.  
Contracts were renewed for three U.S. fracturing crews late in the
first quarter of 2013. As expected, pricing declined for all three
crews to market levels. These pricing decreases were offset by
pricing increases for two existing fracturing crews working under
contract in dry gas regions. These factors, combined with relatively
stable spot market pricing in our areas of operations, led to stable
overall pricing for our U.S. operations on a sequential basis.
Pricing decreased by 9% compared to the first quarter of 2012.  
We continued to realize improvements in our U.S. cost structure
during the first quarter of 2013. Realized guar prices decreased by
approximately 33%, sequentially and led to a 470 basis point
improvement in U.S. operating margins compared to the fourth quarter
of 2012. We also continued to make progress on our cost cutting
initiatives with meaningful reductions in product transportation and
logistics, employee, and repairs and maintenance costs.  
Our cementing service line continues to grow in the U.S. as cementing
activity increased both sequentially and year-over-year. We are
continuing to establish our coiled tubing service line in the U.S.
and coiled tubing activity levels were up compared to the first
quarter of 2012. However, coiled tubing activity levels were down
slightly, sequentially as this market remained very competitive
during the first quarter.  
This was the first quarter of operations for i-TEC in the U.S. as a
Trican managed division. We are currently integrating this division
into our U.S. operations and, as a result, i-TEC operations did not
have a meaningful impact on our first quarter U.S. results. We have
been very pleased with the i-TEC technology and customer response in
the U.S. and have retained all of the U.S. based i-TEC staff. We will
continue to focus on building the market presence and customer base
for i-TEC and our U.S. completion tools division throughout the
remainder of 2013.  
Q1 2013 versus Q1 2012 
U.S. revenue was down 4% in the first quarter of 2013 compared to the
first quarter of 2012. Revenue per job decreased by 21% due to a 9%
decrease in pricing combined with a decrease in fracturing revenue
relative to the total revenue and a decrease in fracturing job size.
The job count increased by 21% due largely to the growth of our
cementing and coiled tubing service lines.  
As a percentage of revenue, materials and operating expenses
increased to 88.4% from 88.0% compared to the same period in 2012.
The margin reduction from pricing decreases was offset by a reduction
in guar expenses and other cost savings from cost-cutting
initiatives. General and administrative costs increased by $1.8
million due to increased shared based compensation, U.S. head office
expenses, and insurance costs.  
Q1 2013 versus Q4 2012 
On a sequential basis, U.S. revenue increased by 21%. The job count
increased by 23% due largely to the 25% increase in overall equipment
utilization for our U.S. operations. Fracturing represented the most
substantial increase as the job count was up over 30% for this
service line. Re
venue per job decreased by 1% as a marginal increase
in fracturing revenue relative to total revenue and a 2%
strengthening of the U.S. dollar relative to the Canadian dollar were
more than offset by smaller fracturing job sizes performed during the
quarter. 
As a percentage of revenue, materials and operating expenses
decreased to 88.4% from 98.6%. Operating margins benefitted from
increased operational leverage on our fixed costs and cost reductions
realized for guar, product transportation and logistics, employee,
and repairs and maintenance expenses. General and administrative
expenses increased by $1.9 million due largely to increased share
based compensation and profit sharing expenses. 
INTERNATIONAL OPERATIONS 


 
----------------------------------------------------------------------------
($ thousands,                                                               
 except revenue per                                                         
 job, unaudited)                                                            
                      March              March                              
                        31,     % of       31,     % of    Dec. 31,    % of 
Three months ended,    2013  Revenue      2012  Revenue        2012 Revenue 
----------------------------------------------------------------------------
Revenue              70,111             64,709               68,039         
Expenses                                                                    
  Materials and                                                             
   operating         68,384     97.5%   61,302     94.7%     57,941    85.2%
  General and                                                               
   administrative     3,848      5.5%    3,696      5.7%      4,216     6.2%
                   ---------          ---------          -----------        
  Total expenses     72,232    103.0%   64,998    100.4%     62,157    91.4%
Operating (loss)                                                            
 income(i)           (2,121)    (3.0%)    (289)    (0.4%)     5,882     8.6%
Number of jobs          914                942                  951         
Revenue per job      73,249             64,435               68,586         
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(i) see first page of this report 
Sales Mix 


 
----------------------------------------------------------------------------
Three months ended,                     March 31,    March 31,     Dec. 31, 
(unaudited)                                  2013         2012         2012 
----------------------------------------------------------------------------
% of Total Revenue                                                          
Fracturing                                     84%          80%          82%
Coiled Tubing                                   8%           7%           9%
Cementing                                       5%           9%           6%
Nitrogen                                        2%           3%           1%
Other                                           1%           1%           2%
----------------------------------------------------------------------------
Total                                         100%         100%         100%
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
Operations Review 
Our International operations include the financial results for
operations in Russia, Kazakhstan, Algeria, Australia, Saudi Arabia,
Colombia and Norway. 
Our Russian operations comprise the majority of our international
results and activity levels in Russia were below expectations during
the first quarter of 2013. Several of our Russian customers' work
programs were delayed due to various third-party operational issues.
In addition, first quarter activity in Russia is typically impacted
by extreme cold temperatures and, as a result, the first quarter is
normally the weakest quarter of the year for this region.  
First quarter financial results were strong in Kazakhstan for our two
fracturing crews operating in the region. Continued challenges in
Algeria, slower than expected activity levels in Australia, and
start-up costs in Saudi Arabia and Colombia had a negative impact on
first quarter operating margins for our International operations.  
This was the first quarter of operations for i-TEC internationally as
a Trican managed division. We are currently integrating this division
into our international operations and the integration costs
contributed to an operating loss for the i-TEC international division
during the quarter. i-TEC's international operations are currently
focused on expansion into Trican's various international markets with
the most promising near-term growth expected in Russia. Trican is
focused on building i-TEC's market presence in Russia and expects to
be in a position to grow our Russian tool revenue as the number of
horizontal wells grows in this region.  
Q1 2013 versus Q1 2012 
Revenue for our International operations increased by 8% compared to
the first quarter of 2012. Revenue per job increased by 14% due
primarily to an increase in fracturing revenue relative to total
revenue, a modest increase in Russian pricing, and an increase in
fracturing job size. The increase in horizontal completions and
multi-stage fracturing for our Russian operations led to an increase
in fracturing job size. The job count decreased by 3% due largely to
a year-over-year decrease in cementing activity for our Russian
operations.   
As a percentage of revenue, materials and operating expenses
increased to 97.5% from 94.7% compared to the first quarter of 2012.
Operating margins were negatively impacted by higher fuel costs in
Russia as well as start-up costs in Saudi Arabia, Colombia, and
integration costs for i-TEC. General and administrative costs were
relatively consistent on a year-over-year basis.  
Q1 2013 versus Q4 2012 
International revenue increased by 3% compared to the fourth quarter
of 2012. Revenue per job increased by 7% due largely to the increase
in fracturing revenue relative total revenue, and to a lesser extent,
because of a modest increase in pricing for our Russian operations.
The number of jobs decreased by 4% due largely to lower sequential
activity for our Russian operations.  
As a percentage of revenue, materials and operating expenses
increased to 97.5% from 85.2%. Operating margins in Russia were down
on a sequential basis due primarily to higher fuel and product
transportation costs. Weaker sequential margins in Australia, an
increase in start-up costs for our Saudi Arabia and Colombia
operations, and integration costs for i-TEC also had a negative
impact on International operating margins. General and administrative
costs decreased by $0.4 million due to 
lower employee costs.   
CORPORATE  


 
----------------------------------------------------------------------------
($ thousands,                                                               
 unaudited)                                                                 
                         March             March                            
                           31,     % of      31,     % of  Dec. 31,    % of 
Three months ended,       2013  Revenue     2012  Revenue      2012 Revenue 
----------------------------------------------------------------------------
Expenses                                                                    
  Materials and                                                             
   operating             6,663      1.1%   6,409      0.9%    6,603     1.4%
  General and                                                               
   administrative       12,987      2.1%  12,171      1.7%   13,077     2.7%
                      ---------         ---------         ----------        
  Total expenses        19,650      3.2%  18,580      2.6%   19,680     4.1%
Operating loss(i)      (19,650)          (18,580)           (19,680)        
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
(i) see first page of this report  
Q1 2013 versus Q1 2012 
Corporate costs increased by $1.1 million due largely to higher share
based employee expenses. Trican's share price increased by 12% during
the first quarter of 2013 compared to a decrease of 24% during the
first quarter of 2012. 
Q1 2013 versus Q4 2012 
Corporate costs were virtually unchanged on a sequential basis. Cost
reductions were realized from decreased professional fees and
donations expenses due to one-time costs associated with the i-TEC
transaction and a large charitable donation recorded in the fourth
quarter of 2012. These decreases were fully offset by increased
profit sharing and share-based compensation paid to employees.
Trican's share price increased by 12% during the first quarter of
2013 compared to 2% during the fourth quarter of 2012. 
OTHER EXPENSES AND INCOME 
Finance costs increased by $1.5 million on a year-over-year basis due
to increased debt balances. Depreciation and amortization increased
by $11.2 million compared to the same period last year, largely due
to capital additions relating to our capital expansion program.  
The foreign exchange gain of $1.7 million in the quarter versus a
gain of $0.7 million in the same quarter last year was due to the net
impact of fluctuations in the U.S. dollar and Russian rouble relative
to the Canadian dollar. Other income was $2.1 million in the quarter
versus $1.3 million for the same period in the prior year. Other
income is largely comprised of interest income on a loan to an
unrelated third-party and interest income earned on cash balances.  
INCOME TAXES 
Trican recorded income tax expense of $9.7 million in the quarter
versus $31.6 million for the comparable period of 2012. The decrease
in tax expense is primarily attributable to a reduction in Canadian
taxable income. 
LIQUIDITY AND CAPITAL RESOURCES 
Operating Activities 
Funds provided by operations decreased to $58.0 million in the first
quarter of 2013 from $141.5 million in the first quarter of 2012 due
largely to a decrease in earnings. 
At March 31, 2013, Trican had working capital of $591.7 million
compared to $547.4 million at the end of 2012. The increase is
predominantly due to an increase in North American activity, offset
partially by less cash on hand.  
Investing Activities 
Capital expenditures for the first quarter of 2013 totaled $31.0
million compared with $155.9 million for the same period in 2012. A
substantial decrease in our 2013 capital program relative to the 2012
program resulted in a significant decline in capital expenditures.  
Capital expenditures for the remainder of 2013 are expected to be
$100 to $120 million based on current 2013 budgets and remaining
capital expenditures on previously approved budgets.  
During the first quarter of 2013, Trican closed the previously
announced acquisition of i-TEC in exchange for cash consideration of
$30.0 million and 2.4 million Trican common shares valued at $29.5
million.  
Financing Activities 
As at May 8, 2013, Trican had 148,831,558 common shares and 8,248,371
employee stock options outstanding. 
During the first quarter of 2013, Trican drew an additional $26.4
million from its $500.0 million revolving credit facility. The
balance of the facility at March 31, 2013, was $280.2 million leaving
$219.8 million of available debt under the facility.  
During the first quarter of 2013, Trican received approval from the
Toronto Stock Exchange to renew the normal course issuer bid to
purchase its own common shares, for cancellation, for the one-year
period of March 8, 2013, to March 7, 2014. During the quarter ended
March 31, 2013, no common shares were purchased under the normal
course issuer bid.  
Trican currently pays a semi-annual dividend of $0.15 per share.
During the quarter, $22.0 million in dividend payments were made and
we expect approximately $22.0 million in additional payments to be
made in the third quarter of 2013.  
OUTLOOK 
Canadian Operations 
We expect Canadian activity levels to be down year-over-year in the
second quarter due to an expectation of less pad drilling and
completions activity and an extended break-up throughout the WCSB.
Lower activity, combined with a decrease in year-over-year pricing,
is expected to result in lower 2013 second quarter operating margins
compared to the second quarter of 2012 for our Canadian operations. 
For the second half of 2013, we expect activity levels to be up on a
year-over-year basis and do not anticipate any meaningful additions
to Canadian pressure pumping equipment capacity. However, demand for
our services in the second half of the year will be dependent on
several factors, including commodity prices and the cash flows and
spending levels of our customers. Stronger natural gas prices are
positively affecting cash flow for our customers, although we have
not yet seen it translate into increased drilling programs. We also
expect to complete a large Horn River fracturing project early in the
third quarter and are seeing strong Duvernay activity starting in
July or late June that should positively impact second half activity.
Despite the prospect of strong second half activity in Canada, we
expect to see slight decreases in Canadian pricing in the second half
of 2013 as the Canadian market continues to be competitive.  
U.S. Operations 
Contracts for three fracturing crews were renewed late in the first
quarter of 2013. Pricing decreased for all three contracts and, as a
result, we expect U.S. pricing to be sequentially lower in the second
quarter; however, we continue to expect spot market pricing to remain
stable for the remainder of 2013.  
Utilization of our Marcellus, Hayneville and Eagle Ford crews were
strong in the first quarter and we anticipate these areas to remain
strong in the upcoming quarters. We expect to have opportunities to
improve the utilization of our Permian, Oklahoma and Bakken crews and
will be focusing on this for the remainder of 2013. 
There are opportunities to increase utilization through
high-technology product offerings including water recycling services,
fluid systems and completion tools. We believe we have new products
that will differentiate Trican from many of our U.S. competitors and
we will continue to market these products to new and existing U.S.
customers with the goal of increasing our U.S. market share. We
anticipate overall industry activity to remain stable during the
second half of the year but will continue to monitor the effects of
increased natural gas prices on our U.S. customers' spending plans.
We do not anticipate any meaningful additional equipment entering the
market this year.  
We will continue to focus on reducing our U.S. cost structure.
Progress was made over the last few quarters but we believe there are
opportunities to further reduce costs. We believe that we can
continue to lower our product handling and transportation costs
through better logistics management. In addition, we expect that
improvements to our U.S. infrastructure will provide opportunities to
lower outsourcing costs for repairs and maintenance and product
storage in the second half of 2013.  
We believe that the majority of the cost savings from guar have been
realized. We expect guar prices to remain relatively stable for the
remainder of the year and have a minimal impact on operating margins. 
International Operations 
Activity levels in Russia were lower than expected in the first
quarter; however, we expect our Russian customers to increase
activity and that most of the lost revenue in the first quarter will
be recovered over the remainder of 2013. However, we do not expect to
recover all of the lost revenue and now expect Russian revenue to
increase by approximately 15-20%, as measured in Russian roubles,
relative to 2012. Our ability to meet these Russian revenue targets
will be largely dependent on the activity levels of our Russian
customers and weather conditions over the remainder of 2013. Cost
inflation continues to negatively impact our Russian operating
margins. As a result, the increase in revenue is expected to generate
only a modest improvement in Russian operating margins relative to
2012. 
We continue to focus on increasing utilization in Australia for our
cementing service line and will look to obtain new work tenders over
the course of 2013. We have recently been awarded additional
contracts in Australia, which are expected to increase sequential
utilization for this region.   
Through our joint business arrangements in Saudi Arabia and Colombia,
we are working to establish our presence in these markets and expect
to participate in pressure pumping tenders throughout the remainder
of 2013. 
Our Kazakhstan operations continued to be profitable although
year-over-year activity was down in the region. We continue to expect
activity levels to be down slightly year-over-year with strong
operating margins for the remainder of 2013.  
The Algerian market slowed in the first quarter partially due to a
pullback in activity after a terrorist attack on a production
facility. The Algerian cementing market remains very competitive and
we will look to increase pricing and utilization for this service
line over the remainder of 2013. 
NON-IFRS DISCLOSURE 
Adjusted net income (loss), operating income and funds provided by
(used in) operations do not have any standardized meaning as
prescribed by IFRS and, therefore, are considered non-IFRS measures.  
Adjusted net income (loss) and funds provided by operations have been
reconciled to profit, and operating income has been reconciled to
gross profit, being the most directly comparable measures calculated
in accordance with IFRS. The reconciling items have been presented
net of tax. 


 
----------------------------------------------------------------------------
(thousands; unaudited)                     Three months ended               
----------------------------------------------------------------------------
                                    March 31,       March 31,      Dec. 31, 
                                         2013            2012          2012 
----------------------------------------------------------------------------
Adjusted net income (loss)            $27,380         $92,300       ($5,375)
Deduct:                                                                     
  Non-cash share-based                                                      
   compensation expense                 2,188           2,918         2,455 
----------------------------------------------------------------------------
                                                                            
Profit (loss) for the period                                                
 (IFRS financial measure)             $25,192         $89,382       ($7,830)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
(thousands; unaudited)                     Three months ended               
----------------------------------------------------------------------------
                                  March 31,       March 31,        Dec. 31, 
                                       2013         2012(i)         2012(i) 
----------------------------------------------------------------------------
Funds provided by (used in)                                                 
 operations                         $57,956        $141,487        ($14,317)
Charges to income not                                                       
 involving cash                                                             
  Depreciation and                                                          
   amortization                     (47,059)        (35,832)        (41,564)
  Amortization of debt                                                      
   issuance costs                      (216)           (202)           (208)
  Stock-based compensation           (2,188)         (2,918)         (2,455)
  Gain (loss) on disposal of                                                
   property and equipment               460             (53)           (352)
  Net finance costs                  (7,532)         (6,378)         (7,824)
  Unrealized foreign                                                        
   exchange gain (loss)               3,296            (193)          4,863 
  Income tax expense                 (9,727)        (31,636)          2,957 
  Interest paid                       2,791           1,195           8,373 
  Income tax paid                    27,411          23,912          42,697 
----------------------------------------------------------------------------
                                                                            
Profit (loss) for the period                                                
 (IFRS financial measure)           $25,192         $89,382         ($7,830)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
(i) prior period calculations have been revised to conform to the
current period calculation  


 
----------------------------------------------------------------------------
(thousands; unaudited)                     Three months ended               
----------------------------------------------------------------------------
                                  March 31,       March 31,        Dec. 31, 
                                       2013            2012            2012 
----------------------------------------------------------------------------
Operating income                    $86,670        $161,845         $35,123 
Add:                                                                        
  Administrative expenses            30,282          27,833          23,083 
Deduct:                                                                     
  Depreciation expense              (47,059)        (35,832)        (41,564)
                                                                            
----------------------------------------------------------------------------
                                                                            
Gross profit (IFRS financial                                                
 measure)                           $69,893        $153,846         $16,642 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
FORWARD-LOOKING STATEMENTS 
This document contains certain forward-looking information and
financial outlook based on Trican's current expectations, estimates,
projections and assumptions that were made by the Company in light of
information available at the time the statement was made.
Forward-looking information and financial outlook that address
expectations or projections about the future, and other statements
and information about the Company's strategy for growth, expected and
future expenditures, costs, operating and financial results, future
financing and capital activities are forward-looking statements. Some
forward-looking information and financial outlook are identified by
the use of terms and phrases such as "anticipate", "achieve",
"achievable", "believe", "estimate", "expect", "intend", "plan",
"planned", and other similar terms and phrases. This forward-looking
information and financial outlook
 speak only as of the date of this
document and we do not undertake to publicly update this
forward-looking information and financial outlook except in
accordance with applicable securities laws. This forward-looking
information and financial outlook include, among others: 


 
--  The expectation that we will continue to focus on establishing a market
    presence for i-TEC and our Canadian completion tools division throughout
    the remainder of 2013; 
--  The expectation that we will continue to focus on building the market
    presence and customer base for i-TEC and our U.S. completion tools
    division throughout the remainder of 2013; 
--  The expectation that our Russian customers will increase activity levels
    and that most of the lost revenue in the first quarter will be recovered
    over the remainder of 2013; 
--  The belief that Trican is focused on building i-TEC's market presence in
    Russia; 
--  The expectation that Trican will be in a position to grow our Russian
    tool revenue as the number of horizontal wells grows in this region;  
--  The expectation that capital expenditures for the remainder of 2013 will
    be $100 to $120 million based on current 2013 budgets and remaining
    capital expenditures on previously approved budgets; 
--  The expectation that approximately $22.0 million in additional dividend
    payments will be made in the third quarter of 2013; 
--  The expectation that Canadian activity levels will be down year-over-
    year in the second quarter due to an expectation of less pad drilling
    and completions activity and an extended break-up throughout the WCSB; 
--  The expectation that lower activity combined with a decrease in year-
    over-year pricing will result in lower 2013 second quarter operating
    margins compared to the second quarter of 2012 for our Canadian
    operations; 
--  The expectation that second half Canadian activity levels will be up on
    a year-over-year basis; 
--  The expectation that no meaningful additions to Canadian pressure
    pumping capacity will occur in the second half of 2013; 
--  The expectation that demand for our services in Canada in the second
    half of the year will be dependent on several factors, including
    commodity prices and the cash flows and spending levels of our
    customers; 
--  The expectation that we will complete a large Horn River project early
    in the third quarter of 2013; 
--  The expectation that strong Duvernay activity will positively impact
    second half Canadian activity; 
--  The expectation that Canadian pricing will decrease slightly in the
    second half of 2013; 
--  The expectation that U.S. pricing will be sequentially lower in the
    second quarter; 
--  The expectation that U.S. spot market pricing will remain stable for the
    remainder of 2013; 
--  The expectation that utilization for our Marcellus, Haynesville and
    Eagle Ford will be strong in the upcoming quarters; 
--  The expectation that we will have opportunities to improve the
    utilization for Permian, Oklahoma and Bakken crews in the upcoming
    quarters; 
--  The belief that there are opportunities to increase our U.S. utilization
    through high-technology product offerings including water recycling
    services, fluid systems and completion tools; 
--  The belief that we have new products that will differentiate Trican from
    many of our U.S. competitors and we will continue to market these
    products to new and existing U.S. customers with the goal of increasing
    our U.S. market share; 
--  The expectation that U.S. industry activity will remain stable during
    the second half of 2013: 
--  The expectation that no meaningful additional equipment will enter the
    U.S. market this year; 
--  The expectation that we will continue to focus on reducing our U.S. cost
    structure; 
--  The belief that there are opportunities to further reduce U.S. costs; 
--  The belief that we can continue to lower our product handling and
    transportation costs in the U.S. through better logistics management; 
--  The expectation that improvements to our U.S. infrastructure will
    provide opportunities to lower outsourcing costs for repairs and
    maintenance and product storage in the second half of 2013; 
--  The belief that the majority of the cost savings from guar have been
    realized; 
--  The expectation that guar prices will remain relatively stable for the
    remainder of the year and will have a minimal impact on operating
    margins; 
--  The expectation that Russian revenue will increase by 15-20%, as
    measured in Russian roubles, relative to 2012; 
--  The expectation that the increase in revenue will generate only a modest
    improvement in Russian operating margins relative to 2012; 
--  The expectation that we will look to obtain new work tenders over the
    course of 2013 in Australia; 
--  The expectation that utilization will increase sequentially in
    Australia; 
--  The expectation that we will participate in pressure pumping tenders
    during the remainder of 2013 in Saudi Arabia and Colombia; 
--  The expectation that activity levels will be down slightly year-over-
    year in Kazakhstan with strong operating margins for the remainder of
    2013; 
--  The expectation that we will look to increase pricing and utilization
    for our cementing service line in Algeria. 

 
Forward-looking information and financial outlook is based on current
expectations, estimates, projections and assumptions, which we
believe are reasonable but which may prove to be incorrect. Trican's
actual results may differ materially from those expressed or implied
and therefore such forward-looking information and financial outlook
should not be unduly relied upon. In addition to other factors and
assumptions which may be identified in this document, assumptions
have been made regarding, among other things: industry activity; the
general stability of the economic and political environment; effect
of market conditions on demand for the Company's products and
services; the ability to obtain qualified staff, equipment and
services in a timely and cost efficient manner; the ability to
operate its business in a safe, efficient and effective manner; the
performance and characteristics of various business segments; the
effect of current plans; the timing and costs of capital
expenditures; future oil and natural gas prices; currency, exchange
and interest rates; the regulatory framework regarding royalties,
taxes and environmental matters in the jurisdictions in which the
Company operates; and the ability of the Company to successfully
market its products and services. 
Forward-looking information and financial outlook is subject to a
number of risks and uncertainties, which could cause actual results
to differ materially from those anticipated. These risks and
uncertainties include: fluctuating prices for crude oil and natural
gas; changes in drilling activity; general global economic, political
and business conditions; weather conditions; regulatory changes; the
successful exploitation and integration of technology; customer
acceptance of technology; success in obtaining issued patents; the
potential development of competing technologies by market
competitors; and availability of products, qualified personnel,
manufacturing capacity and raw materials. The foregoing important
factors are not exhaustive. In addition, actual results could differ
materially from those anticipated in forward-looking information and
financial outlook provided herein as a result of the risk factors set
forth under the section entitled "Risks Factors" in our Annual
Information Form dated March 21, 2013. Readers are also referred to
the risk factors and assumptions described in other documents filed
by the Company from time to time with securities regulatory
authorities.  
Additional information regarding Trican including Trican's most
recent annual information form is available under Trican's profile on
SEDAR (www.sedar.com). 
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION    


 
                                                  March 31,    December 31, 
(Stated in thousands; unaudited)                       2013            2012 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
ASSETS                                                                      
Current assets                                                              
 Cash and cash equivalents                    $      71,580   $     113,506 
 Trade and other receivables                        545,489         437,038 
 Current tax assets                                   7,784             647 
 Inventory                                          226,289         211,794 
 Prepaid expenses                                    30,661          33,002 
----------------------------------------------------------------------------
                                                    881,803         795,987 
Property and equipment                            1,449,019       1,458,562 
Intangible assets                                     9,259          10,081 
Deferred tax assets                                  89,590          76,302 
Other assets                                         19,544          11,898 
Goodwill                                             84,442          43,689 
----------------------------------------------------------------------------
                                              $   2,533,657   $   2,396,519 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
LIABILITIES AND SHAREHOLDERS' EQUITY                                        
Current liabilities                                                         
 Bank loans                                   $       9,258   $       9,119 
 Trade and other payables                           278,417         228,788 
 Contingent consideration                             2,453           2,860 
 Current tax liabilities                                  -           7,853 
----------------------------------------------------------------------------
                                                    290,128         248,620 
                                                                            
Loans and borrowings                                723,364         694,972 
Deferred tax liabilities                             79,319          77,012 
                                                                            
Shareholders' equity                                                        
 Share capital                                      557,395         527,860 
 Contributed surplus                                 57,540          55,352 
 Accumulated other comprehensive income             (16,971)        (24,100)
 Retained earnings                                  841,063         815,700 
----------------------------------------------------------------------------
Total equity attributable to equity holders                                 
 of the Company                                   1,439,027       1,374,812 
Non-controlling interest                              1,819           1,103 
----------------------------------------------------------------------------
                                              $   2,533,657   $   2,396,519 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
See accompanying notes to the condensed consolidated financial statements.  

 
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME    


 
(Stated in thousands, except per share amounts;                             
 unaudited)                                                                 
Three months ended March 31,                             2013          2012 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Revenue                                           $   618,376   $   716,356 
Cost of sales                                         548,483       562,510 
----------------------------------------------------------------------------
Gross profit                                           69,893       153,846 
Administrative expenses                                30,282        27,833 
Other income                                           (1,114)         (689)
----------------------------------------------------------------------------
Results from operating activities                      40,725       126,702 
Finance income                                           (956)         (657)
Finance costs                                           8,488         7,035 
Foreign exchange gain                                  (1,726)         (694)
----------------------------------------------------------------------------
Profit before income tax                               34,919       121,018 
Income tax expense                                      9,727        31,636 
----------------------------------------------------------------------------
Profit for the period                                  25,192        89,382 
----------------------------------------------------------------------------
                                                                            
Other comprehensive income                                                  
Items which may subsequently be recycled through                            
 profit or loss                                                             
 Unrealized gain on hedging instruments                   100           703 
 Foreign currency translation differences               7,029         4,600 
----------------------------------------------------------------------------
Total comprehensive income for the period         $    32,321   $    94,685 
----------------------------------------------------------------------------
                                                                            
Profit attributable to:                                                     
Owners of the Company                                  25,363        89,460 
Non-controlling interest                                 (171)          (78)
----------------------------------------------------------------------------
Profit for the period                             $    25,192   $    89,382 
----------------------------------------------------------------------------
                                                                            
Total comprehensive income attributable to:                                 
Owners of the Company                                  32,331        94,763 
Non-controlling interest                                  (10)          (78)
----------------------------------------------------------------------------
Total comprehensive income for the period         $    32,321   $    94,685 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Earnings per share                                                          
----------------------------------------------------------------------------
 Basic                                            $      0.17   $      0.61 
 Diluted                                          $      0.17   $      0.61 
----------------------------------------------------------------------------
Weighted average shares outstanding - basic           148,593       146,948 
Weighted average shares outstanding - diluted         148,892       147,357 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
See accompanying notes to the condensed consolidated financial statements.  

 
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS    


 
(Stated in thousands; unaudited)Three months                                
 ended March 31,                                         2013          2012 
----------------------------------------------------------------------------
Cash Provided By/(Used In):                                                 
Operations                                                                  
 Profit for the period                            $    25,192   $    89,382 
 Charges to income not involving cash:                                      
  Depreciation and amortization                        47,059        35,832 
  Amortization of debt issuance costs                     216           202 
  Stock-based compensation                              2,188         2,918 
  (Gain)/loss on disposal of property and                                   
   equipment                                             (460)           53 
  Net Finance Costs                                     7,532         6,378 
  Unrealized foreign exchange (gain)/loss              (3,296)          193 
  Income tax expense                                    9,727        31,636 
----------------------------------------------------------------------------
                                                       88,158       166,594 
 Change in inventories                                (13,203)      (25,357)
 Change in trade and other receivables               (101,438)      (37,454)
 Change in prepayments                                  2,839        (5,733)
 Change in trade and other payables                    73,020        42,795 
----------------------------------------------------------------------------
Cash generated from operating activities               49,376       140,845 
                                                                            
 Interest paid                                         (2,791)       (1,195)
 Income tax paid                                      (27,411)      (23,912)
----------------------------------------------------------------------------
                                                       19,174       115,738 
                                                                            
Investing                                                                   
 Interest received                                          -           485 
 Purchase of property and equipment                   (30,986)     (155,887)
 Proceeds from the sale of property and                                     
  equipment                                               929            91 
 Purchase of other assets                              (4,000)            - 
 Payments received on loan to an unrelated third                            
  party                                                     -           226 
 Business acquisitions                                (31,009)            - 
----------------------------------------------------------------------------
                                                      (65,066)     (155,085)
                                                                            
Financing                                                                   
 Net proceeds from issuance of share capital                -           739 
 Repurchase and cancellation of shares under                                
  NCIB                                                      -        (3,506)
 Issuance of long-term debt, net of financing                               
  costs                                                26,354        11,776 
 Dividend paid                                        (21,968)       (7,345)
----------------------------------------------------------------------------
                                                        4,386         1,664 
                                                                            
Effect of exchange rate changes on cash                  (420)          (65)
----------------------------------------------------------------------------
                                                                            
Decrease in cash and cash equivalents                 (41,926)      (37,748)
Cash and cash equivalents, beginning of period        113,506       125,855 
----------------------------------------------------------------------------
Cash and cash equivalents, end of period          $    71,580   $    88,107 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
See accompanying notes to the condensed consolidated financial statements.  

 
SELECTED NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS (UNAUDITED) 
BUSINESS ACQUISITIONS 
Effective January 11, 2013, Trican acquired all of the issued and
outstanding shares and discharged the existing debt of Petro Tools
Holding AS, the holding company for i-Tec Well Solutions and its
subsidiaries (collectively "i-Tec"), for consideration of $60.5
million, which is made up of cash of $31.0 million and 2,381,381
Trican common shares, issued at $12.73 per share. The initial
accounting for the acquisition is incomplete, as Trican is working to
quantify the opening fair values of the assets acquired, liabilities
assumed and intangible assets arising from the acquisition.
Furthermore, the value of goodwill arising from the synergies created
through the i-Tec acquisition will be determined once the values at
acquisition have been established. In conjunction with the
acquisition, Trican has agreed to pay contingent consideration of up
to U.S. $45 million subject to agreed upon financial targets for
i-Tec for the year ended December 31, 2013. Trican has determined the
acquisition fair value of the contingent consideration to be nil. All
of i-Tec's earnings have been included in Trican's condensed
consolidated statement of comprehensive income since January 11,
2013. 
The preliminary acquisition fair values have been determined as
follows: 


 
(Stated in thousands)                                                       
----------------------------------------------------------------------------
Fair value of acquired net assets:                                          
 Net working capital (including cash)                            $     8,099
 Property and equipment                                                4,880
 Deferred tax assets                                                   7,275
 Goodwill                                                             40,290
----------------------------------------------------------------------------
                                                                 $    60,544
----------------------------------------------------------------------------
Financed as follows:                                                        
 Cash                                                            $    31,009
 Shares issued out of treasury                                        29,535
----------------------------------------------------------------------------
                                                                 $    60,544
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
Final fair value determinations will be made once the accounting for
the transaction has been completed.  
LOANS AND BORROWINGS 
Long term debt 


 
                                                                            
                                                    March 31,      December 
                                                         2013      31, 2012 
----------------------------------------------------------------------------
Notes payable                                     $   438,438   $   430,408 
Finance lease obligations                              33,407        36,324 
Revolving credit facility                             280,170       255,693 
Hedge receivable                                       (6,265)       (5,059)
----------------------------------------------------------------------------
Total                                                 745,750       717,366 
Current portion of finance lease obligations (1)       13,128        13,275 
Russian demand revolving credit facility                9,258         9,119 
----------------------------------------------------------------------------
Non-current                                       $   723,364   $   694,972 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
(1) Current portion of finance lease obligations is included in trade and   
    other payables.                                                         

 
Trican has a $500.0 million four year extendible revolving credit
facility ("Revolving Credit Facility") with a syndicate of banks. The
Revolving Credit Facility is unsecured and bears interest at the
applicable Canadian prime rate, U.S. prime rate, Banker's Acceptance
rate, or at LIBOR, plus 50 to 325 basis points, dependent on certain
financial ratios of the Company. On October 18, 2012, Trican extended
its Revolving Credit Facility by an additional year to 2016. The
Revolving Credit Facility requires Trican to comply with certain
financial and non-financial covenants that are typical for this type
of arrangement. Trican was in compliance with these covenants at
March 31, 2013 (2012 - in compliance). 
INCOME TAXES  


 
Three months ended March 31,                             2013          2012 
----------------------------------------------------------------------------
Current income tax expense                        $    12,422   $    44,692 
Deferred income tax recovery                           (2,695)      (13,056)
----------------------------------------------------------------------------
                                                  $     9,727   $    31,636 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
The net income tax provision differs from that expected by applying
the combined federal and provincial income tax rate of 25.17% (2012 -
25.17%) to income before income taxes for the following reasons: 


 
Three months ended March 31,                             2013          2012 
----------------------------------------------------------------------------
Expected combined federal and provincial income                             
 tax                                              $     8,815   $    30,457 
Statutory and other rate differences                   (1,217)         (915)
Non-deductible expenses                                 1,524         1,621 
Stock based compensation                                  551           735 
Translation of foreign subsidiaries                       (39)         (230)
Other                                                      93           (32)
----------------------------------------------------------------------------
                                                  $     9,727   $    31,636 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
OPERATING SEGMENTS 
The Company operates in Canada and the U.S. along with a number of
international regions, which include Russia, Algeria, Kazhakstan,
Saudi Arabia, Colombia, Norway and Australia. Each geographic region
has a General Manager that is responsible for the operation and
strategy of their region's business. Personnel working within the
particular geographic region report to the General Manager; the
General Manager reports to the Corporate Executive.  
The Company provides a comprehensive array of specialized products,
equipment, services and technology to customers through three
operating divisions: 


 
--  Canadian Operations provides cementing, fracturing, coiled tubing,
    nitrogen, geological, acidizing, reservoir management, industrial
    cleaning and pipeline, and completion systems and downhole tool
    services. 
--  U.S. Operations provides cementing, fracturing, coiled tubing, nitrogen,
    acidizing and completion systems and downhole tool services which are
    performed on new and existing oil and gas wells. 
--  International Operations provides cementing, fracturing, coiled tubing,
    acidizing, nitrogen, and completion systems and downhole tool services
    which are performed on new and existing oil and gas wells. 

 
Information regarding the results of each geographic region is
included below. Performance is measured based on revenue and gross
profit as included in the internal management reports which are
reviewed by the Company's executive management team. Each region's
gross profit is used to measure performance as management believes
that such information is most relevant in evaluating regional results
relative to other entities that operate within the industry.
Transactions between the segments are recorded at cost and have been
eliminated upon consolidation. 


 
                                                   United                  
                                 Canadian          States    International 
                               Operations      Operations       Operations 
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Three months ended March 31, 2013                                          
---------------------------------------------------------------------------
Revenue                    $      338,649  $      210,685   $       70,111 
Gross profit/(loss)                81,341           1,639           (5,239)
Finance income                          -               -                - 
Finance costs                           -               -                - 
Tax expense/(recovery)             13,994          (3,247)          (1,020)
Depreciation and                                                           
 amortization                      16,683          22,907            6,993 
Assets                          1,010,906       1,131,014          330,878 
Goodwill                           63,279               -           21,163 
Property and equipment            554,351         769,147          110,326 
Capital expenditures               13,313          15,563            2,109 
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Three months ended March 31, 2012                                          
---------------------------------------------------------------------------
Revenue                    $      433,111  $      218,536   $       64,709 
Gross profit/(loss)               155,691           7,238           (2,719)
Finance income                          -               -                - 
Finance costs                           -               -                - 
Tax expense /(recovery)            32,366            (313)          (1,431)
Depreciation and                                                           
 amortization                      11,990          17,461            6,216 
Assets                          1,048,384         932,758          282,628 
Goodwill                           22,690               -           21,012 
Property and equipment            571,628         618,833          105,187 
Capital expenditures               32,114         111,419           12,354 
---------------------------------------------------------------------------
                                                                           
 
                             Intersegment                                   
                             Eliminations        Corporate            Total 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three months ended March                                                    
 31, 2013                                                                   
----------------------------------------------------------------------------
Revenue                    $       (1,069)  $            -   $      618,376 
Gross profit/(loss)                  (708)          (7,140)          69,893 
Finance income                          -             (956)            (956)
Finance costs                           -            8,488            8,488 
Tax expense/(recovery)                  -                -            9,727 
Depreciation and                                                            
 amortization                           -              476           47,059 
Assets                               (360)          60,619        2,533,057 
Goodwill                                -                            84,442 
Property and equipment                  -           15,195        1,449,019 
Capital expenditures                    -                -           30,985 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three months ended March                                                    
 31, 2012                                                                   
----------------------------------------------------------------------------
Revenue                    $            -   $            -   $      716,356 
Gross profit/(loss)                     -           (6,364)         153,846 
Finance income                          -              657              657 
Finance costs                           -           (7,035)          (7,035)
Tax expense /(recovery)                 -            1,014           31,636 
Depreciation and                                                            
 amortization                           -              165           35,832 
Assets                                  -          115,539        2,379,309 
Goodwill                                -                -           43,702 
Property and equipment                  -           13,487        1,309,135 
Capital expenditures                    -                -          155,887 
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The Corporate division does not represent an operating segment and is
included for informational purposes only. Corporate division expenses
consist of salary expenses, stock-based compensation and office costs
related to corporate employees, as well as public company costs.
Contacts:
Trican Well Service Ltd.
Dale Dusterhoft
Chief Executive Officer
ddusterhoft@trican.ca 
Trican Well Service Ltd.
Michael Baldwin
Vice President, Finance & CFO
mbaldwin@trican.ca 
Trican Well Service Ltd.
Gary Summach
Director of Reporting and Investor Relations
gsummach@trican.ca 
Trican Well Service Ltd.
(403) 266 - 0202
(403) 237 - 7716 (FAX)
2900, 645 - 7th Avenue S.W.
Calgary, Alberta T2P 4G8
 
 
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