Trinidad Drilling Ltd. reports solid first quarter 2014 results; stable dayrates and operating margins in existing business, gr

 Trinidad Drilling Ltd. reports solid first quarter 2014 results; stable  dayrates and operating margins in existing business, growing international  momentum  /NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION  IN THE UNITED STATES/  TSX SYMBOL:  TDG  CALGARY, May 7, 2014 /CNW/ - Trinidad Drilling Ltd. ("Trinidad" or the  "Company") reported solid first quarter 2014 results; with stable dayrates(1)  and operating margins in its Canadian and US operations and growing  international joint venture momentum.  "The first quarter has been a solid start to what we believe will be an  important year for Trinidad," said Lyle Whitmarsh, Trinidad's Chief Executive  Officer. "Our existing North American business continues to operate in line  with our expectations and we are well positioned to benefit from the improving  industry conditions we see happening in the US and that we anticipate in  Canada for the second half of 2014. This year is an important year as we  transition from a solely North American drilling contractor to a growing  international service provider. Our joint venture with Halliburton is  progressing well with benefits being recognized by both partners already. We  continue to evaluate future expansion opportunities for the joint venture and  expect that this will be a significant area of growth for us over the coming  years."        (1) See Non-GAAP Measures Definition and Additional GAAP Measures         Definition section of this document for further details.     FINANCIAL HIGHLIGHTS                                                                         Three months ended March 31,                                                ($ thousands except share and per           2014         2013  % Change     share data)     Revenue                                  251,505      247,186       1.7     Revenue, net of third party costs        231,018      227,377       1.6     Operating income (1)                      95,192       98,359     (3.2)     Operating income percentage (1)            37.8%        39.8%     (5.0)     Operating income - net percentage          41.1%        43.3%     (5.1)     (1)     EBITDA (1)                                81,255       82,014     (0.9)       Per share (diluted) (2)                   0.58         0.68    (14.7)     Adjusted EBITDA (1)                       79,441       84,836     (6.4)       Per share (diluted) (2)                   0.57         0.70    (18.6)     Cash provided by operations               19,433       40,495    (52.0)       Per share (basic / diluted) (2)           0.14         0.34    (58.8)     Funds provided by operations (1)          60,857       64,943     (6.3)       Per share (basic / diluted) (2)           0.44         0.54    (18.5)     Net earnings                              25,762       32,748    (21.3)       Per share (basic / diluted) (2)           0.19         0.27    (29.6)     Adjusted net earnings (1)                 27,746       35,573    (22.0)       Per share (basic / diluted) (2)           0.20         0.29    (31.0)     Capital expenditures                      31,206       17,337      80.0     Dividends declared                         6,908        6,043      14.3     Shares outstanding - diluted                                                  (weighted average) (2)             138,899,380  120,859,476      14.9     As at                                  March 31, December 31,               ($ thousands except percentage              2014         2013  % Change     data)     Total assets                           1,930,989    1,827,496       5.7     Total long-term liabilities              597,006      564,095       5.8     (1)  Readers are cautioned that Operating income, Operating income          percentage, Operating income - net percentage, EBITDA, Adjusted          EBITDA, Funds provided by operations, Adjusted net earnings and          the related per share information do not have standardized          meanings prescribed by IFRS - see "Non-GAAP Measures" and          "Additional GAAP Measures".     (2)  Basic shares include the weighted average number of shares          outstanding over the period. Diluted shares include the weighted          average number of shares outstanding over the period and the          dilutive impact, if any, of the number of shares issuable pursuant          to the Incentive Option Plan.  OPERATING HIGHLIGHTS                                                                         Three months ended March 31,                                                                                                 2014   2013 % Change     Land Drilling Market                                                       Operating days (1)                                                            Canada                                        4,077  4,198    (2.9)        United States and International               4,311  4,453    (3.2)     Rate per operating day (1)                                                    Canada (CDN$)                                25,415 25,401      0.1        United States and International (CDN$)       24,630 22,416      9.9        United States and International (US$)        22,641 22,487      0.7     Utilization rate - operating day (1)                                          Canada                                          74%    79%    (6.0)        United States and International                 76%    72%      5.9     Number of drilling rigs at period end                                         Canada                                           61     60      1.7        United States and International                  61     68   (10.3)        Coring and surface casing rigs (2)                -     15        -     Barge Drilling Market                                                         Operating days (1)                              244    415   (41.3)        Rate per operating day (CDN$) (1)            37,815 29,097     30.0        Rate per operating day (US$) (1)             34,767 29,158     19.2        Utilization rate - operating day (1)            54%    92%   (41.1)        Number of barge drilling rigs at period end       2      2        -        Number of barge drilling rigs under Bareboat                              Charter Agreements at period end                   3      3        -     Joint Venture Operations (3)                                                 Number of drilling rigs at period end              3      -        -     (1)  See Non-GAAP Measures Definition and Additional GAAP Measures          Definition section of this document for further details.     (2)  In the third quarter of 2013, Trinidad disposed of its 15          remaining coring rigs and all related equipment.          Trinidad is party to a joint venture with a wholly-owned     (3)  subsidiary of Halliburton. These rigs are owned by the joint          venture.  OVERVIEW  Trinidad recorded solid results in the first quarter of 2014, with stable  dayrates and operating margins in the Company's drilling operations and  growing momentum in its international joint venture, despite the absence of  the coring rigs that were sold in 2013.  During the quarter, commodity prices increased from the same quarter in 2013  and the fourth quarter of 2013, improving sentiment within the industry and  increasing oil and gas producers' ability to generate higher cash flow. Crude  oil prices improved for both the US-based WTI benchmark and the Western  Canadian Select benchmark prices, driving an ongoing focus towards crude oil  and natural gas liquids targets. Colder-than-usual weather across North  America and lower storage levels led to strong gains in natural gas pricing  from the previous quarter and the same period last year. Despite these  significantly higher natural gas prices, the industry did not demonstrate a  trend of increased natural gas drilling, choosing rather to stay with their  existing targets and collect increased cash flow from associated natural gas  production.  In the first quarter of 2014, Canadian industry activity levels averaged 58%,  unchanged from the same quarter last year and up from 43% in the previous  quarter due to seasonality. In the US, industry activity increased in the  quarter, averaging 1,705 active rigs, up 1.1% from the same quarter last year  and 1.5% from the previous quarter. The US industry began to show signs of  improvement with increased activity in the first quarter, a trend that has  continued to date into the second quarter of 2014.  During the first quarter of 2014, the US dollar strengthened against the  Canadian dollar. USD/CDN dollar exchange rates averaged 1.0882 in the quarter  compared to 0.9971 in the same quarter last year and 1.0400 in the previous  quarter. Trinidad has a significant portion of its business that operates in  US dollars and the change in foreign exchange rates in the quarter had a  noticeable, and largely positive impact on the Company's results. The stronger  US dollar positively impacted EBITDA generated by Trinidad's US and  international division but also drove increased depreciation and interest  expenses in the quarter. In addition, the value of the Company's senior note  increased solely as a result of the impact of foreign exchange in the quarter.  INDUSTRY STATISTICS                                                                                                     Full                          Full                 2014   Year                2013      Year            2012                   Q1  2013    Q4     Q3    Q2    Q1  2012    Q4    Q3    Q2     Commodity     Prices                                                                       Aeco     natural gas     price (CDN$     per     gigajoule)   5.34  3.01  3.33   2.32  3.36  3.03  2.26  3.03  2.18  1.81     Henry Hub     natural gas     price (US$     per mmBtu)   5.15  3.72  3.84   3.55  4.01  3.47  2.75  3.40  2.88  2.29     Western     Canada     Select     crude oil     price                                                                          (CDN$ per       barrel)   85.81 75.84 69.62  86.31 79.25 67.64 71.70 60.73 76.29 74.10     WTI crude     oil price     (US$ per     barrel)     98.72 98.01 97.56 105.82 94.14 94.30 94.09 88.17 92.15 93.30                                                                                  US Activity                                                                  Average     industry     active land     rig count     (1)         1,705 1,685 1,679  1,687 1,686 1,687 1,852 1,741 1,837 1,902     Average     Trinidad     active land     rig count     (2)            48    50    49     51    50    49    57    56    55    58                                                                                  Canadian     Activity                                                                     Average     industry     utilization     (3)           58%   40%   43%    37%   18%   58%   39%   36%   42%   18%     Average     Trinidad     utilization     (4)           68%   48%   48%    50%   24%   73%   52%   51%   58%   24%     (1)  Baker Hughes rig counts (information obtained from Tudor Pickering          Holt & Company weekly rig roundup report).     (2)  Includes US and international rigs.     (3)  Canadian Association of Oilwell drilling Contractors (CAODC)          utilization.     (4)  Based on drilling days (spud to rig release dates).     FIRST QUARTER 2014 HIGHLIGHTS         --  Trinidad generated revenue of $251.5 million in the first             quarter of 2014, up $4.3 million and 1.7% from the same quarter             in 2013. Revenue increased in the current period as a result of             a higher level of external rig manufacturing and a positive             foreign currency translation from Trinidad's US division;             partly offset by the absence of the Company's coring rigs,             lower activity from the Mexican rigs and a weaker contribution             from the barge operations.         --         --  Overall operating income - net percentage decreased from 43.3%             in the first quarter of 2013 to 41.1% in the current quarter.             Profitability in Trinidad's drilling operations remained stable             compared to the same quarter last year with operating income -             net percentage for the Company's Canadian and US and             international operations largely unchanged at 48.0% and 38.2%,             respectively. Operating income - net percentage for the             Manufacturing segment increased to 8.6% in the current quarter             due to a higher level of external new builds in 2014. Overall,             the manufacturing division typically generates lower margins             than Trinidad's drilling operations as the external new builds             are constructed for Trinidad's joint venture company and joint             venture partner. An increased contribution from the             manufacturing operations in 2014 caused overall profitability             to decline.         --  Adjusted EBITDA was $79.4 million in the quarter, down 6.4%             from the same quarter last year. Adjusted EBITDA decreased in             the quarter largely as a result of a decrease in operating             income. This was partially offset by a favorable foreign             exchange translation on Trinidad's US and international             operations, as the US dollar strengthened against the Canadian             dollar in the period.         --  Net earnings in the quarter were $25.8 million or $0.19 per             share (diluted), down 21.3% from the same quarter last year.             Net earnings decreased largely as a result of a lower operating             income in the current year, higher general and administration             costs, a foreign exchange loss recorded in 2014 and larger             deferred income taxes; offset slightly by a gain on sale in             2014 on three rigs sold to the joint venture.         --  Adjusted net earnings decreased by $7.8 million in the quarter             compared to the same quarter last year, with adjusted net             earnings per share (diluted) decreasing $0.09 per share.             Adjusted net earnings decreased in the current year due to             lower adjusted EBITDA, and higher income tax expenses in the             current period.         --  During the first quarter, Trinidad made progress on its joint             venture with Halliburton, selling three upgraded US rigs to the             joint venture and transporting them to Saudi Arabia. In             addition, Trinidad added a new area of operation for the joint             venture during the quarter, agreeing to build four new rigs for             operation in Mexico. All of the joint venture rigs will be             operating under three year, take-or-pay contracts, with a one             year optional extension by the customer.  RESULTS FROM OPERATIONS  Canadian Operations                                                                               Three months ended March 31,                                              ($ thousands except percentage and                               operating data)                            2014   2013 (4)   % Change     Operating revenue (1)                   103,607    115,442     (10.3)     Other revenue                               722         44    1,540.9                                             104,329    115,486      (9.7)     Operating costs (1)                      54,300     59,591      (8.9)     Operating income (3)                     50,029     55,895     (10.5)     Operating income - net percentage (3)     48.0%      48.4%                                                                                          Operating days (3)                        4,077      4,198      (2.9)     Drilling days (3)                         3,713      3,864      (3.9)     Rate per operating day (CDN$) (3)        25,415     25,401        0.1     Utilization rate - operating day (3)        74%        79%      (6.0)     Utilization rate - drilling day (3)         68%        73%      (7.3)     CAODC industry average (2)                  58%        58%          -                                                                               Number of drilling rigs at period end        61         60        1.7     Number of coring and surface rigs                                           at period end                               -         15          -     (1)  Operating revenue and operating costs for the three months ended          March 31, 2014 and 2013 exclude third party recovery and third          party costs of $14.5 million and $13.7 million, respectively.     (2)  CAODC industry average is based on drilling days divided by total          days available.     (3)  See Non-GAAP Measures Definition and Additional GAAP Measures          Definition section of this document for further details.     (4)  During the prior year, Trinidad's Canadian operations included the          Canadian manufacturing division. Effective January 1, 2014,          Trinidad has re-evaluated operating segments. Management has          determined that the Manufacturing operations is considered a          separate operating segment. All prior period segmented information          has been reclassified to conform to this new presentation.  In the first quarter of 2014, Trinidad's Canadian operations generated $11.8  million or 10.3% less operating revenue when compared to the same quarter last  year. Operating revenue lowered largely as a result of the sale of Trinidad's  preset and coring rigs in the third quarter of 2013; these rigs generated $8.8  million in operating revenue in the first quarter of 2013 compared to nil in  the current period. The preset and coring rigs, including related inventory,  were sold in the third quarter of 2013 for $12.0 million.  In addition, the segment's drilling rigs recorded 121 less operating days than  the same quarter last year, negatively impacting operating revenue in the  current period. The lower operating days were mainly driven by weaker customer  demand in the oilsands sector, reducing activity for the company's lower  specification equipment. While activity was lower quarter over quarter,  Trinidad's high performance, modern fleet continued to outperform industry  activity levels, recording utilization levels that exceeded the industry  average by ten percentage points for 2014. This is a reflection of the  Company's strategic focus towards in-demand, high performance equipment backed  by a strong customer base and long-term contracts. Dayrates in the current  period were largely unchanged from the same quarter last year.  Operating income - net percentage declined slightly in the current period when  compared to the prior year, due to weaker customer demand in the oil sands  sector combined with increased labor costs related to a crew wage increase  that occurred in the second half of 2013. The lower customer demand in the oil  sand sector reduced activity levels and negatively impacted margins. In  addition, the crew wage increase in the third quarter of the prior year, which  is passed on to operators at cost, reduced profitability as a percentage of  revenue in the quarter.  During the current quarter, Trinidad's active rig fleet increased by one rig  when compared to March 31, 2013; one rig was delivered in the third quarter of  2013. This rig was constructed by the Company's Manufacturing operations and  was put into service in the Duvernay shale under a long-term, take-or-pay  contract.  First quarter 2014 versus fourth quarter 2013  Compared to the fourth quarter of 2013, revenue and operating income increased  by $30.4 million and $16.7 million, respectively, in the first quarter of  2014. The increase is mainly due to the seasonal nature of the Canadian  drilling division as the winter drilling season is typically a more active  period. Additionally, dayrates increased in the current period by $313 per day  mainly due to the demand for additional equipment on active rigs during the  winter drilling season. Operating income - net percentage also increased to  48.0% compared to 45.1% in the fourth quarter of 2013 due to stronger revenue  generation based on the increased number of operating days and the increased  dayrate in the current period.  United States and International Operations                                                                                 Three months ended March 31,                                                ($ thousands except percentage and                                 operating data)                              2014   2013 (3)   % Change     Operating revenue (1)                     114,781    111,575        2.9     Other revenue                                  46         22      109.1                                               114,827    111,597        2.9     Operating costs (1)                        70,972     69,014        2.8     Operating income (1)                       43,855     42,583        3.0     Operating income - net percentage (2)       38.2%      38.2%                                                                                             Land Drilling Rigs                                                         Operating days (2)                          4,311      4,453      (3.2)     Drilling days (2)                           3,727      3,823      (2.5)     Rate per operating day (CDN$) (2)          24,630     22,416        9.9     Rate per operating day (US$) (2)           22,641     22,487        0.7     Utilization rate - operating day (2)          76%        72%        5.9     Utilization rate - drilling day (2)           66%        62%        6.3     Number of drilling rigs at period end          61         68     (10.3)                                                                                  Barge Drilling Rigs                                                        Operating days (2)                            244        415     (41.3)     Rate per operating day (CDN$) (2)          37,815     29,097       30.0     Rate per operating day (US$) (2)           34,767     29,158       19.2     Utilization rate - operating day (2)          54%        92%     (41.1)     Number of barge drilling rigs at period                            end                                             2          2          -     Number of barge drilling rigs under                                               Bareboat Charter Agreements at                               period end                                      3          3          -     (1) Operating revenue and operating costs for the three months ended         March 31, 2014 and 2013 exclude third party recovery and third         party costs of $5.7 million and $6.1 million, respectively.     (2) See Non-GAAP Measures Definition and Additional GAAP Measures         Definition section of this document for further details.     (3) During the prior year, Trinidad's US and international operations         included the US manufacturing division. Effective January 1, 2014,         Trinidad has re-evaluated operating segments. Management has         determined that the Manufacturing operations is considered a         separate operating segment. All prior period segmented information         has been reclassified to conform to this new presentation.  In the first quarter of 2014, Trinidad's US and international segment recorded  operating revenue of $114.8 million, up 2.9% from the same quarter last year.  Operating revenue increased in the quarter due to improved dayrates and a  stronger US dollar, partially offset by lower operating days and a weaker  contribution from the Company's barge operations.  Dayrates in the current quarter increased by US$154 per day compared to the  same quarter last year. Dayrates increased as a result of early termination  revenue and standby revenue received in the quarter. This standby and early  termination revenue increased the dayrate in the first quarter by US$1,713 per  day, compared to US$665 per day in the same period in 2013. Early termination  revenue was received on two rigs during the quarter. Both of these rigs have  subsequently been put back to work with a new customer under long-term  contracts. Higher US dollar dayrates combined with a stronger USD/CDN exchange  rate in 2014 caused dayrates, when converted to Canadian dollars, to increase  by CDN$2,214 per day compared to the same quarter last year.  Operating days decreased by 142 days quarter over quarter as a result of three  Mexican rigs that were idle in the current quarter. Excluding the impact of  these rigs, the US land drilling division recorded an increase in operating  days in the quarter.  The three rigs Trinidad has in Mexico completed their contracts at the end of  the second quarter of 2013 and were idle during most of the second half of  2013 and into 2014, negatively impacting utilization and revenue generation in  the current year. Trinidad is currently pursuing future opportunities for  these rigs and expects to redeploy them to Canada where they are expected to  return to work in the second half of 2014.  For the three months ended March 31, 2014, Trinidad's active rig count  decreased by seven rigs when compared to the prior year. Four rigs were  removed from Trinidad's active rig count at December 31, 2013, due to these  rigs not meeting customer requirements in the current drilling environment.  Additionally, three rigs were sold to Trinidad's joint venture in the first  quarter of 2014.  Operating income - net percentage remained consistent at 38.2% quarter over  quarter. Early termination and standby revenues in the US land drilling  division, offset by decreased profitability in the Company's barge division  and Mexico rigs led to overall stable profitability.  Trinidad's barge drilling rigs continued to demand a strong dayrate in the  current year, showing an increase of US$5,609 per day in 2014 compared to the  prior year. However, a decline in operating days in the current period caused  overall revenue generation and profitability to decline. Drilling projects  that were expected to take place in the first quarter were pushed back to  later periods, causing downtime in the current quarter on these rigs. Trinidad  anticipates that activity levels will return to previous levels in the coming  quarters.  First quarter 2014 versus fourth quarter 2013  Compared to the fourth quarter of 2013, revenue and operating income decreased  by $21.2 million and $21.6 million, respectively, in the first quarter of  2014. The decrease in the current period was due to lower early termination  and standby revenues received in 2014 as well as a decrease in overall  operating days in the current period. In the fourth quarter of 2013, Trinidad  recorded US$25.4 million of early termination and standby revenue, compared to  US$7.4 million received in 2014. Additionally, a decrease of 159 operating  days in the current period has also negatively affected revenue generation in  the period.  Operations in the current period were also negatively impacted by the decline  in operations of Trinidad's barge drilling rigs, which had operating days and  utilization of 244 days and 54%, respectively, in the first quarter of 2014  compared to 394 days and 86% in the fourth quarter of 2013.  Joint Venture Operations  Summarized statement of operations and comprehensive loss for Trinidad  Drilling International (TDI):                                                                                 For the three months ended March 31, 2014              TDI     Trinidad     ($ thousands)                                    ownership    ownership                                                     percentage   percentage                                                           100%          60%     Revenue                                                                     Oilfield service revenue                             3,316        1,990                                                          3,316        1,990     Expenses                                                                    Operating expenses                                   2,074        1,244     General and administrative expenses                  1,466          880     Foreign exchange                                       (6)          (4)     Loss                                                 (218)        (131)  During 2013, Trinidad signed a joint venture agreement with Halliburton with a  right of first look at all drilling projects outside of Canada and the United  States. The joint venture is expected to concentrate initially on Saudi Arabia  and Mexico, with future growth opportunities in other international markets.  The joint venture will conduct business under the name Trinidad Drilling  International (TDI) through separately incorporated entities.  Trinidad owns 60% of the shares of TDI, and each of Trinidad and Halliburton  have equal voting rights with respect to the operations of the company. TDI is  accounted for using the equity method of accounting, whereby Trinidad takes  60% of the net income recorded as loss (gain) from investment in joint venture.  During the three months ended March 31, 2014, TDI took ownership of the three  upgraded rigs purchased from Trinidad's US land drilling division. These rigs  have not been put into service as of the quarter end; however, they did  collect standby revenue, which accounts for the entire revenue balance earned  in the quarter. Drilling operations are expected to commence early in the  second quarter in Saudi Arabia.  Rig Purchase Commitments  During 2013, TDI agreed to purchase four rigs from Trinidad for operations in  Saudi Arabia, three upgraded rigs from Trinidad's US operations and one new  build rig constructed by Trinidad's manufacturing division. As of March 31,  2014, TDI has taken ownership of the three upgraded rigs, with the new build  rig expected to be completed in the second half of 2014. All four rigs will be  operating under three-year, take-or-pay contracts with an optional one year  extension.  Additionally, early in 2014, TDI agreed to purchase four rigs from Trinidad's  manufacturing division for operations in Mexico. Each of these rigs will be  high performance, 3,600 horsepower, AC, walking rigs, operating under  three-year, take-or-pay contracts with an optional one year extension. These  rigs are expected to be delivered towards the end of 2014 and early 2015.  Manufacturing Operations                                                                            Three months ended March 31,                                           ($ thousands except percentage and                            operating data)                           2014     2013   % Change     Operating revenue (2)                   11,854      294    3,931.9     Other revenue                                8        -          -                                             11,862      294    3,934.6     Operating costs (2)                     10,836      413    2,523.7     Operating income (1)                     1,026    (119)      962.1     Operating income - net percentage (1)     8.6%   -40.5%                (1) See Non-GAAP Measures Definition and Additional GAAP Measures         Definition section of this MD&A for further details.         For the three months ended March 31, 2014, included in operating         revenue and operating costs are downstream elimination entries of     (2) $7.6 million and $6.9 million, respectively (2013, nil and nil,         respectively). These entries remove Trinidad's percentage of         profits related to manufacturing of rigs for the joint venture.  Effective January 1, 2014, Trinidad reviewed all existing operating segments  in order to better present the Company's operations based on geographic  location, services provided and any material changes to operations. In the  prior year, Trinidad's manufacturing operations mainly performed work  internally; therefore, the prior year operating income includes a loss based  on costs incurred by the manufacturing division mainly related to raw  materials consumed during construction of rigs for internal use. Towards the  end of 2013 and early 2014, Trinidad's manufacturing division signed contracts  to build rigs for external parties, including the Company's joint venture  partner and the joint venture company.  As the manufacturing operations begins to record operating revenues and costs,  management believes that presenting this division as a separate operating  segment from the Company's drilling operations is more useful to users as it  will provide a more accurate representation of the margins recorded on  Trinidad's drilling operations. Prior period segmented information has been  reclassified to conform to the current period's presentation.  The purpose of the manufacturing operations is to support rig builds and rig  maintenance for all of Trinidad's divisions, including all associates and  joint ventures. All contracts are based on a cost plus formula which is  calculated in order for Trinidad to break even on rig builds when all costs,  including general and administrative expenses, are factored in. Contracts are  negotiated depending on the Company's varying involvement, which can range  from full scale design and manufacturing to project management with a large  degree of outsourcing.  Towards the end of 2013 and into 2014, Trinidad signed five new build  contracts. One rig for the joint venture to operate in Saudi Arabia and four  rigs for the joint venture to operate in Mexico. Additionally, Trinidad has  agreed to build a training rig for their joint venture partner. For the period  ended March 31, 2014, Trinidad recognized revenues and expenses related to the  one Saudi rig build and the training rig, compared to no external new build  revenues or expenses recognized in 2013. Additionally, as of March 31, 2014,  Trinidad is still early in the construction phase of the four Mexico rigs.  Long-lead items have been ordered, but assembly has not occurred as yet.  Therefore, there is no related revenue or expenses included in Trinidad's  operating income related to the construction of these rigs.  Delivery of the Saudi rig is expected in the second half of 2014, the training  rig is expected to be delivered towards the end of 2014 and delivery of the  four Mexico rigs is expected towards the end of 2014 and early 2015.  QUARTERLY ANALYSIS FINANCIAL HIGHLIGHTS - QUARTERLY ANALYSIS                                                                                                 2014                 2013                  2012     ($ millions except     per share data and     operating data)      Q1    Q4     Q3    Q2     Q1     Q4     Q3    Q2      Revenue             251.5 224.6  208.7 165.4  247.2  209.6  215.1 174.3     Operating income     (1)                  95.2  99.6   76.2  55.7   98.4   77.8   80.6  66.4     Operating income     percentage (1)      37.8% 44.4%  36.5% 33.6%  39.8%  37.1%  37.5% 38.1%     Operating income -     net percentage (1)  41.1% 47.0%  38.5% 35.6%  43.3%  39.7%  40.0% 40.0%     Net earnings     (loss)               25.8  28.8    9.2   0.3   32.7 (12.4)   20.0  12.9     Adjustments for:                                                             Depreciation and     amortization         30.2  29.5   30.1  27.6   29.9   29.2   30.4  25.8      Foreign exchange     3.1   0.9    0.4     -      -  (1.4)    0.8 (0.7)      (Gain) loss on     sale of property     and equipment      (10.5)   0.1  (0.1)   1.3      - (11.5)      - (0.5)      Impairment of     property and     equipment               -     -      -   0.1      -   70.1    1.3     -      Loss from     investment in     Joint Venture         0.1   0.8      -     -      -      -      -     -      Finance costs       10.0  12.0   10.4  10.0   10.0   10.1   10.3  10.5      Income taxes        15.3  11.1    5.9 (1.6)    9.4 (22.2)    2.7   4.4      Interest Income    (0.2) (0.1)      -     -      -      -      -     -      Other                5.6   1.5    5.9   2.2    2.8    1.4    2.9   1.0      Income taxes     paid                (0.4) (1.8)      - (0.8)  (1.3)  (2.0)  (1.1) (0.7)      Income taxes     recovered             0.3   1.5    0.4   0.7      -    0.7    3.9     -      Interest paid     (18.6) (1.1) (18.4) (0.7) (18.6)  (1.1) (19.5) (1.5)      Interest     received              0.2   0.1      -     -      -      -      -     -     Funds provided by     operations (1)       60.9  83.3   43.8  39.1   64.9   60.9   51.7  51.2     Net earnings     (loss) per share     (diluted)            0.19  0.23   0.08     -   0.27 (0.10)   0.17  0.11     Funds provided by     operations per     share (diluted)      0.44  0.67   0.36  0.32   0.54   0.50   0.43  0.42     (1) See the Non-GAAP Measures Definitions and Additional GAAP Measures         Definitions section of this document for further details.  NON-GAAP MEASURES HIGHLIGHTS - QUARTERLY ANALYSIS                                                                                             2014                 2013                    2012        ($ thousands         except per     share data and                 Q3     Q2     Q1      Q4     Q3     Q2           operating             data)    Q1     Q4      EBITDA (1)     81,255 81,246 55,635 36,326 82,014   4,825 63,398 53,572     Per share     (diluted) (2)    0.58   0.65   0.46   0.30   0.68    0.04   0.52   0.44     Adjusted     EBITDA (1)     79,441 83,830 61,838 39,941 84,836  63,332 68,387 53,344     Per share     (diluted) (2)    0.57   0.68   0.51   0.33   0.70    0.52   0.57   0.44     Adjusted net     earnings (1)   27,746 86,168 54,938 38,730 35,573 103,557 80,132 55,678     Per share     (diluted) (2)    0.20   0.69   0.45   0.32   0.29    0.86   0.66   0.46           See the Non-GAAP Measures Definitions and Additional GAAP     (1)   Measures Definitions section of this document for further           details.           Diluted shares include the weighted average number of shares     (2)   outstanding over the period and the dilutive impact, if any, of           the number of shares issuable pursuant to the Incentive Option           Plan.  OPERATING HIGHLIGHTS - QUARTERLY ANALYSIS                                                                                                  2014                  2013                   2012                        Q1     Q4     Q3     Q2     Q1     Q4     Q3     Q2      Land Drilling                                                               Market                                                               Operating days                                                              (1)                                                                     Canada        4,077  2,935  3,018  1,434  4,198  2,915  3,233  1,288        United                                                         5,289       States and       International  4,311  4,470  4,733  4,578  4,453  4,789  5,038     Rate per                                                                    operating day         (1)                                                                     Canada                                                        25,343       (CDN$)        25,415 25,102 23,686 25,511 25,401 26,190 23,501        United                                                        22,586       States and       International       (CDN$)        24,630 27,243 23,297 22,908 22,416 22,305 22,518        United                                                        22,616       States and       International       (US$)         22,641 26,213 22,460 22,436 22,487 22,589 22,263     Utilization                                                                 rate -                operating day     (1)                                                                     Canada          74%    52%    54%    26%    79%    56%    62%    26%        United                                                           86%       States and       International    76%    71%    76%    73%    72%    77%    81%     Number of                                                                   drilling rigs         at period end                                                           Canada           61     61     61     60     60     59     57     55        United                                                            68       States and       International     61     64     68     68     68     68     68        Coring and                                                        20       surface       casing rigs        -      -      -     15     15     15     20                                                                                 Barge Drilling                                                              Market                                                                  Operating                                                        429       days (1)         244    394    449    445    415    386    376        Rate per                                                      29,072       operating day       (CDN$) (1)    37,815 34,810 33,962 31,731 29,097 29,954 30,008        Rate per                                                      29,106       operating day       (US$) (1)     34,767 33,490 32,740 31,077 29,158 30,330 29,583        Utilization                                                      94%       rate -       operating day       (1)              54%    86%    97%    98%    92%    84%    82%        Number of                                                          2       barge       drilling rigs       at period       end                2      2      2      2      2      2      2        Number of                                                                  barge       drilling rigs       under                                                                Bareboat                                                            3       Charter at       period end         3      3      3      3      3      3      3     Joint Venture                                                               Operations (2)                                                         Number of                                                           -       drilling rigs       at period end      3      -      -      -      -      -      -     (1)  See Non-GAAP Measures Definition and Additional GAAP Measures          Definition section of this document for further details          Trinidad is party to a joint venture with a wholly-owned          subsidiary of Halliburton. During the first quarter of 2014, 3     (2)  rigs were sold to the joint venture by Trinidad's US and          international operations. Effective March 31, 2014, these rigs are          owned by the joint venture.  FINANCIAL SUMMARY  Trinidad's total long-term debt balance increased by $19.2 million during the  current year when compared to December 31, 2013. This increase was due to the  increase in the Senior Notes at March 31, 2014, and is entirely a result of  the increase in the US to Canadian dollar exchange rate in 2014 versus the  prior year as these notes are held in US funds. The Senior Notes are  translated at each period end, as such their value will fluctuate with  variations in exchange rates. The Senior Notes are due January 2019 and  interest is payable semi-annually in arrears on January 15 and July 15.  As of March 31, 2014 and December 31, 2013, Trinidad's revolving debt  facilities were completely paid off, leaving $200.0 million and US$100.0  million unutilized in these facilities, respectively. The Company continues to  consider future capital commitments, and as such, the unutilized facilities  are expected to be used in the future course of business. The Canadian and US  revolving facilities require quarterly interest payments that are based on  Bankers Acceptance and LIBOR rates and incorporate a tiered interest rate,  which varies depending on the results of the Consolidated Total Debt to Bank  EBITDA ratio. The facility matures on December 16, 2017, and is subject to  annual extensions of an additional year on each anniversary.  Capital expenditures                                                           Three months ended March 31,        2014     2013     New Builds                        15,351   12,527     Capital Upgrades & Enhancements   10,800    1,616     Maintenance & Infrastructure       5,055    3,194     Total                             31,206   17,337  During the three months ended March 31, 2014, a total of $31.2 million was  spent on capital expenditures, compared to $17.3 million for the same period  in the prior year. These capital expenditures were substantially related to  the Company's rig build program for its Canadian operations. As well, Trinidad  continued to work on upgrading existing equipment including moving systems,  top drives and mud systems, to ensure the Company's rigs remain competitive in  the current market.  The costs associated with Trinidad's external new builds are not included in  the Company's capital expenditures shown above. These costs are accounted for  using the percentage of completion method and are recorded as operating costs  included in Trinidad's manufacturing operations.  In 2014, Trinidad expects to spend a total of approximately $315.0 million on  capital projects. This total includes Trinidad's internal capital projects,  Trinidad's portion of the joint venture capital projects, and takes into  account proceeds received for existing rigs sold into the joint venture.  Trinidad's capital budget is further broken down as follows:  ------------------------------         --  Completion of one new rig to be delivered to Trinidad's             Canadian operations for LNG-related drilling;         --  Completion of  one new rig and the upgrading of three existing             rigs to be delivered to Saudi Arabia for the joint venture             arrangement;         --  Construction of four new rigs to be delivered to Mexico for the             joint venture arrangement in late 2014 or early 2015;         --  Upgrades to improve the efficiency and marketability of more             than 30 existing rigs; and         --  Maintenance and infrastructure capital.  ------------------------------  Excluding proceeds received from the sale of rigs into the joint venture,  Trinidad spent $38.1 million on internal capital projects and its portion of  the joint venture projects in the first quarter of 2014. Costs related to the  joint venture rig build projects are accounted for as operating expenses in  Trinidad's manufacturing operations.  As of March 31, 2014, the three upgraded rigs have been delivered to the joint  venture, and Trinidad continues work on the remaining new build rigs included  in the 2014 capital program.  OUTLOOK  To date in 2014, activity levels have remained firm in North America, with  Canadian conditions similar to last year and the US beginning to show  increasing activity and dayrates.  In the past 12 months the benefits of modern, high-performance equipment have  become more widely acknowledged and customers are increasingly looking for  efficient, technically-advanced equipment that can drill deeper and  longer-reach horizontal wells. This trend is continuing and expanding into new  areas and Trinidad's reputation as a high-performance driller with modern,  efficient rigs positions it well for these changing industry conditions.  Natural gas prices have remained stronger to date in 2014 and while they have  not yet led to a significant increase in dry gas drilling, the improved  pricing on associated gas production improves customers' cash flow and  provides the ability to increase capital spending as the year progresses.  Industry conditions in Canada are stable, with upside momentum as oil and gas  producers re-evaluate their capital programs under stronger commodity prices.  In addition, LNG-related demand is expected to drive increasing activity  levels as the projects and their timelines become clearer towards the end of  2014 and into 2015. In the US, conditions continue to improve with activity  levels across the country growing and dayrates moving up, particularly for  high performance equipment. On the international front, Trinidad's joint  venture with Halliburton is progressing well. Trinidad is currently  constructing five new rigs that will be sold into the joint venture to operate  in Mexico and Saudi Arabia, bringing the total number of rigs in the joint  venture to eight. The joint venture is continuing to assess opportunities for  expansion and Trinidad expects this to be a strong area of growth in the  coming years.  Trinidad has followed a strategic plan over the past few years, positioning  the Company well for sustainable growth in today's changing drilling industry.  The next step in Trinidad's plan is to successfully transition from its  historical North American operations to a growing international drilling  contractor. The Company is making good progress on this front while also  remaining focused on its existing US and Canadian operations.  Trinidad  expects to grow its international business at a measured pace, ensuring  operations are well established and running smoothly before adding new  operating areas. Trinidad is uniquely positioned with three distinct growth  areas (Canada, the US and international), while also having the cash flow and  financial flexibility to fund its future growth.  CONFERENCE CALL  A conference call and webcast to discuss the results will be held for the  investment community on Thursday May 8(th), 2014 beginning at 9:00 a.m. MT  (11:00 a.m. ET).  To participate, please dial (888) 231-8191 (toll-free in  North America) or (647) 427-7450 approximately 10 minutes prior to the  conference call. An archived recording of the call will be available from  approximately 12:30 p.m. MT on May 8(th), 2014 until midnight May 15(th), 2014  by dialing (855) 859 2056 or (416) 849-0833 and entering replay access code  25656531.  A live audio webcast of the conference call will also be available via the  Investor Relations page of Trinidad's website.  TRINIDAD DRILLING LTD.  Trinidad is a corporation focused on sustainable growth that trades on the  Toronto Stock Exchange under the symbol TDG. Trinidad's divisions operate in  the drilling and barge-drilling sectors of the North American oil and natural  gas industry with operations in Canada, the United States and Mexico. In  addition, through a joint venture, Trinidad has the opportunity to operate  drilling rigs in other international markets such as Saudi Arabia and Mexico.  Trinidad is focused on providing modern, reliable, expertly designed equipment  operated by well-trained and experienced personnel. Trinidad's drilling fleet  is one of the most adaptable, technologically advanced and competitive in the  industry.                                                                              CONSOLIDATED STATEMENTS OF FINANCIAL            POSITION                                                                                                                                          As at                                       March 31,  December 31,      ($ thousands) - unaudited                        2014          2013                                                                               Assets                                                                   Current Assets                                                           Cash and cash equivalents                     278,069        268,160     Accounts receivable                           212,823        166,557     Inventory                                      19,560          8,474     Prepaid expenses                               15,277          5,557     Assets held for sale                            3,685          3,685                                                   529,414        452,433                                                                              Property and equipment                      1,239,834      1,275,465     Intangible assets and goodwill                 95,229         91,729     Investment in joint venture                    66,512          7,869                                                 1,930,989      1,827,496                                                                              Liabilities                                                              Current Liabilities                                                      Accounts payable and accrued liabilities      101,245        110,455     Dividends payable                               6,908          6,906     Deferred revenue and customer deposits         67,548         31,952                                                   175,701        149,313                                                                              Long-term debt                                487,894        468,670     Deferred income taxes                         109,112         95,425                                                   772,707        713,408                                                                              Shareholders' Equity                                                     Common shares                               1,117,637      1,117,197     Contributed surplus                            50,664         50,607     Accumulated other comprehensive income         29,247          4,404     Deficit                                      (39,266)       (58,120)                                                 1,158,282      1,114,088                                                 1,930,989      1,827,496                                                                                CONSOLIDATED STATEMENTS OF OPERATIONS AND                      COMPREHENSIVE INCOME                                                                                                                          Three months ended March 31,                                           ($ thousands) - unaudited                           2014     2013                                                                             Revenue                                                                Oilfield service revenue                         250,447   247,120     Other revenue                                      1,058        66                                                      251,505   247,186                                                                            Expenses                                                               Operating expense                                156,313   148,827     General and administrative                        21,191    16,314     Depreciation and amortization                     30,255    29,859     Foreign exchange                                   3,154       (5)     (Gain) loss on sale of property and equipment   (10,539)        36                                                      200,374   195,031                                                                            Loss from investment in joint venture                131         -     Finance costs                                      9,959     9,970     Earnings before income taxes                      41,041    42,185                                                                            Income taxes                                                           Current                                              290     1,071     Deferred                                          14,989     8,366                                                       15,279     9,437     Net earnings                                      25,762    32,748                                                                            Other comprehensive income                                             Foreign currency translation adjustment,                                    net of income tax                            24,843     6,683                                                       24,843     6,683     Total comprehensive income                        50,605    39,431     Earnings per share                                                     Net earnings                                                                Basic / Diluted                                0.19      0.27                                                                                     CONSOLIDATED     STATEMENTS OF                                                            CHANGES IN     EQUITY                                                                             For three     months ended                                                             March 31,     2014 and 2013                                                                                                                Accumulated                                                                             other                                                 Common    Contribued   comprehensive                  Total     ($ thousands)                                                            - unaudited       shares      surplus      income (1)    (Deficit)     equity       Balance at     December 31,                                                             2013            1,117,197       50,607           4,404    (58,120)   1,114,088       Exercise of     stock                                                                    options               440        (117)               -           -         323       Share-based                                                            payments                -          174               -           -         174       Total     comprehensive                                                            income                  -            -          24,843      25,762      50,605       Dividends             -            -               -     (6,908)     (6,908)       Balance at     March 31,                                                                2014            1,117,637       50,664          29,247    (39,266)   1,158,282                                                                                          Balance at     December 31,                                                             2012              952,043       50,245        (34,403)   (104,036)     863,849       Stock-based                                                            compensation            -          170               -           -         170       Total     comprehensive                                                            income     (loss)                  -            -           6,683      32,748      39,431       Dividends             -            -               -     (6,043)     (6,043)       Balance at     March 31,                                                                2013              952,043       50,415        (27,720)    (77,331)     897,407     (1) Accumulated other comprehensive income (loss) consisted of the         foreign currency translation adjustment.         All amounts will be reclassified to profit or loss when specific         conditions are met.                                                                                 CONSOLIDATED STATEMENTS OF CASH FLOWS                                                                                                                   For three months ended March 31,                                            ($ thousands) - unaudited                                 2014    2013                                                                                  Cash provided by (used in)                                                  Operating activities                                                        Net earnings                                            25,762   32,748     Adjustments for:                                                              Depreciation and amortization                         30,255   29,859       Foreign exchange                                       3,154      (5)       (Gain) loss on sale of property and equipment       (10,539)       36       Loss from investment in joint venture                    131        -       Finance costs                                          9,959    9,970       Income taxes                                          15,279    9,437       Interest income                                        (180)      (3)       Other (1)                                              5,575    2,791       Income taxes paid                                      (400)  (1,314)       Income taxes recovered                                   310        -       Interest paid                                       (18,629) (18,579)       Interest received                                        180        3     Funds provided by operations                            60,857   64,943     Change in non-cash operating working capital          (41,424) (24,448)     Cash provided by operations                             19,433   40,495                                                                                 Investing activities                                                        Purchase of property and equipment                    (31,206) (17,337)     Proceeds from disposition of property and equipment     88,397      461     Investment in joint venture                           (73,856)        -     Change in non-cash working capital                       8,562    7,275     Cash used by investing                                 (8,103)  (9,601)                                                                                 Financing activities                                                        Proceeds from long-term debt                                 -   10,949     Repayments of long-term debt                                 - (29,138)     Proceeds from exercise of options                          323        -     Dividends paid                                         (6,906)  (6,043)     Cash used by financing                                 (6,583) (24,232)                                                                                 Cash flow from operating, investing and financing         activities                                               4,747    6,662     Effect of translation of foreign currency cash           5,162      197     Increase in cash for the period                          9,909    6,859                                                                                 Cash and cash equivalents - beginning of period        268,160    4,933     Cash and cash equivalents - end of period              278,069   11,792     (1) Other includes share-based payment expense.     SEGMENTED INFORMATION  The following presents the result of Trinidad's operating segments:                                                                                                                         For three                     United States                                                                months ended                        /                                                                               March 31, 2014                                                   Joint                                                       Canadian    International   Manufacturing     Venture    Inter-segment                            ($ thousands)                                                 Operations                                                    Operations     Operations      Operations       (1)       Eliminations    Corporate     Total                                                                                                                         Operating                                                                                                  revenue             103,607         114,781          19,478            -               -           -    237,866     Other revenue           722              46               8            -               -           -        776     Third party                                                                                                recovery             14,522           5,683               -            -               -           -     20,205     General and     administrative                                                                                             - third party     recovery                  -               -               -            -               -         282        282     Inter-segment                                                                                              revenue                   -               -           9,913            -         (9,913)           -          -     Elimination of     downstream                                                                                                 transactions              -               -         (7,624)            -               -           -    (7,624)                         118,851         120,510          21,775            -         (9,913)         282    251,505     Operating            54,300          70,972          17,766            -               -           -    143,038     Third party                                                                                                costs                14,522           5,683               -            -               -           -     20,205     Inter-segment                                                                                              operating                 -               -           9,913            -         (9,913)           -          -     Elimination of     downstream                                                                                                 transactions              -               -         (6,930)            -               -           -    (6,930)     Operating                                                                                                  income               50,029          43,855           1,026            -               -         282     95,192     Depreciation     and                                                                                                        amortization         11,860          17,980             415            -               -           -     30,255     Gain on sale                                                                                               of assets             (261)        (25,656)               -            -               -           -   (25,917)     Elimination of     downstream                                                                                                 transactions              -          15,378               -            -               -           -     15,378                          11,599           7,702             415            -               -           -     19,716     Segmented                                                                                                  income (loss)        38,430          36,153             611            -               -         282     75,476     Joint venture                                                                                              loss                      -               -               -          131               -           -        131     General and                                                                                                administrative            -               -               -            -               -      20,909     20,909     General and     administrative                                                                                             - third party     costs                     -               -               -            -               -         282        282     Foreign                                                                                                    exchange                  -               -               -            -               -       3,154      3,154     Finance costs             -               -               -            -               -       9,959      9,959     Income taxes              -               -               -            -               -      15,279     15,279     Net earnings                                                                                               (loss)               38,430          36,153             611        (131)               -    (49,301)     25,762                                                                                                                         Purchase of     property and                                                                                               equipment            13,037          18,105              64            -               -           -     31,206           (1) The joint venture is recorded using the equity method of accounting. The Company's share of individual     assets and liabilities are recognized as an investment on the consolidated statements of financial position,     and revenues and expense are recognized with net earnings as a (gain) loss from investment in joint venture on     the consolidated statements of operations and comprehensive income.                                                                                                                                                                                                                                      For three                     United States                                                                months ended                        /                                                                               March 31, 2013                                                   Joint                                                       Canadian    International   Manufacturing     Venture    Inter-segment                            ($ thousands)                                                 Operations                                                    Operations     Operations      Operations       (1)       Eliminations    Corporate     Total                                                                                                                         Operating                                                                                                  revenue             115,442         111,575             294            -               -           -    227,311     Other revenue            44              22               -            -               -           -         66     Third party                                                                                                recovery             13,701           6,108               -            -               -           -     19,809     General and     administrative                                                                                             - third party     recovery                  -               -               -            -               -           -          -     Inter-segment                                                                                              revenue                   -               -          11,362            -        (11,362)           -          -     Elimination of     downstream                                                                                                 transactions              -               -               -            -               -           -          -                         129,187         117,705          11,656            -        (11,362)           -    247,186     Operating            59,591          69,014             413            -               -           -    129,018     Third party                                                                                                costs                13,701           6,108               -            -               -           -     19,809     Inter-segment                                                                                              operating                 -               -          11,362            -        (11,362)           -          -     Elimination of     downstream                                                                                                 transactions              -               -               -            -               -           -          -     Operating                                                                                                  income               55,895          42,583           (119)            -               -           -     98,359     Depreciation     and                                                                                                        amortization         11,433          17,915             511            -               -           -     29,859     Loss (gain) on                                                                                             sale of assets          141           (105)               -            -               -           -       36       Elimination of     downstream                                                                                                 transactions              -               -               -            -               -           -          -                          11,574          17,810             511            -               -           -     29,895     Segmented                                                                                                  income (loss)        44,321          24,773           (630)            -               -           -     68,464     Joint venture                                                                                              (gain) loss               -               -               -            -               -           -          -     General and                                                                                                administrative            -               -               -            -               -      16,314     16,314     General and     administrative                                                                                             - third party     costs                     -               -               -            -               -           -          -     Foreign                                                                                                    exchange                  -               -               -            -               -         (5)        (5)     Finance costs             -               -               -            -               -       9,970      9,970     Income taxes              -               -               -            -               -       9,437      9,437     Net earnings                                                                                               (loss)               44,321          24,773           (630)            -               -    (35,716)     32,748                                                                                                                         Purchase of     property and                                                                                               equipment            16,910             363              64            -               -           -     17,337           (1) The joint venture is recorded using the equity method of accounting. The Company's share of individual     assets and liabilities are recognized as an investment on the consolidated statements of financial position,     and revenues and expense are recognized with net earnings as a (gain) loss from investment in joint venture on     the consolidated statements of operations and comprehensive income.           ADVISORY  NON-GAAP MEASURES DEFINITIONS  This document contains references to certain financial measures and associated  per share data that do not have any standardized meaning prescribed by IFRS  and may not be comparable to similar measures presented by other companies.   These financial measures are computed on a consistent basis for each reporting  period and include EBITDA, EBITDA from investment in joint venture, Adjusted  EBITDA, Adjusted EBITDA from investment in joint venture, Adjusted net  earnings, working capital, Senior Debt to Bank EBITDA, Total Debt to Bank  EBITDA, Bank EBITDA to Cash Interest Expense, drilling days, operating days,  utilization rate - drilling day, utilization rate - operating day, and rate  per operating day or dayrate.  These non-GAAP measures are identified and  defined as follows:  "EBITDA" is a measure of the Company's operating profitability. EBITDA  provides an indication of the results generated by the Company's principal  business activities prior to how these activities are financed, assets are  depreciated and amortized or how the results are taxed in various  jurisdictions.  "EBITDA from investment in joint venture" provides an indication of the  results generated by the Company's joint venture operations prior to how these  activities are financed, assets are depreciated and amortized or how the  results are taxed in various jurisdictions.  "Adjusted EBITDA" is used by management and investors to analyze EBITDA (as  defined above) prior to the effect of foreign exchange, share-based payment  expense, impairment expenses and the sale of assets. Adjusted EBITDA also  takes into account the Company's portion of the principal activities of the  joint venture arrangement by removing the loss (gain) from investment in joint  venture and including Adjusted EBITDA from investment in joint venture.  Adjusted EBITDA is not intended to represent net earnings as calculated in  accordance with IFRS. Adjusted EBITDA provides an indication of the results  generated by the Company's principal business activities prior to how these  activities are financed, assets are depreciated, amortized and impaired, the  impact of foreign exchange, how the results are taxed in various jurisdictions  and effects of share-based payment expenses.  Adjusted EBITDA is calculated as follows:                                                                         Three months ended March 31,                                             ($ thousands)                                            2014   2013     EBITDA                                                 81,255 82,014     Plus:                                                                       Loss (gain) on sale of property and equipment     (10,539)     36        Share-based payment expense                          5,575  2,791        Foreign exchange                                     3,154    (5)        Loss from investment in joint venture                  131      -     Less:                                                                       Adjusted EBITDA from investment in joint venture     (135)      -     Adjusted EBITDA                                        79,441 84,836  "Adjusted EBITDA from investment in joint venture" is used by management and  investors to analyze EBITDA (as defined above) prior to the effect of foreign  exchange, share-based payment expense, impairment expenses and the sale of  assets. Adjusted EBITDA from investment in joint venture is not intended to  represent net earnings as calculated in accordance with IFRS. Adjusted EBITDA  from investment in joint venture provides an indication of the results  generated by the TDI's principal business activities prior to how these  activities are financed, assets are depreciated, amortized and impaired, the  impact of foreign exchange, how the results are taxed in various jurisdictions  and effects of share-based payment expenses.  Adjusted EBITDA from investment in joint venture is calculated as follows:                                                                         Three months ended March 31,                                        ($ thousands)                                        2014   2013       EBITDA from investment in joint venture           (131)      -       Less:                                                             Foreign exchange                                    (4)      -       Adjusted EBITDA from investment in joint venture  (135)      -  "Adjusted net earnings" is used by management and the investment community to  analyze net earnings prior to the effect of foreign exchange, share-based  payment expense, any gains or losses on the sale of assets in the period and  impairment charges, including taking into account the tax effects of these  items. This measure is not intended to represent net earnings as calculated in  accordance with IFRS. Adjusted net earnings is a useful measure because it  provides an indication of results of the Company's principal business  activities before consideration of fluctuations in foreign exchange gains and  losses, impairment and share-based payment expenses, which are not  consistently incurred period over period.  "Working capital" is used by management and the investment community to  analyze the operating liquidity available to the Company.  "Senior Debt to Bank EBITDA" is defined as the consolidated balance of the  revolving facility and other debt secured by a lien at quarter end to  consolidated Bank EBITDA for the trailing 12 months (TTM).  Bank EBITDA used  in this financial ratio is calculated as EBITDA plus impairment expense, loss  (gain) on sale of property and equipment, loss (gain) from investment in joint  venture, share-based payment expense and unrealized foreign exchange.  "Total Debt to Bank EBITDA" is defined as the consolidated balance of  long-term debt, which includes the Senior Debt, Senior Notes Payable and  dividends payable at quarter end, to consolidated Bank EBITDA for the TTM.   Bank EBITDA used in this financial ratio is calculated as EBITDA plus  impairment expense, loss (gain) on sale of property and equipment, loss (gain)  from investment in joint venture, share-based payment expense and unrealized  foreign exchange.  "Bank EBITDA to Cash Interest Expense" is defined as the consolidated Bank  EBITDA for TTM to the cash interest expense on all debt balances for TTM.   Bank EBITDA used in this financial ratio is calculated as EBITDA plus  impairment expense, loss (gain) on sale of property and equipment, loss (gain)  from investment in joint venture, share-based payment expense and unrealized  foreign exchange.  "Drilling days" is defined as rig days between spud to rig release.  "Operating days" is defined as moving days (move in, rig up and tear out) plus  drilling days (spud to rig release).  "Utilization rate - drilling day" is defined as drilling days divided by total  available rig days.  "Utilization rate - operating day" is defined as operating days (drilling days  plus moving days) divided by total available rig days.  "Rate per operating day" or "dayrate" is defined as operating revenue (net of  third party costs) divided by operating days (drilling days plus moving days).  ADDITIONAL GAAP MEASURES DEFINITIONS  The Company uses certain additional GAAP financial measures within the  financial statements and document that are not defined terms under IFRS to  assess performance. Management believes that these measures provide useful  supplemental information to investors. These financial measures are computed  on a consistent basis for each reporting period and include Funds provided by  operations, Operating income, Operating income percentage and Operating income  - net percentage. These additional GAAP measures are identified and defined as  follows:  "Funds provided by operations" is used by management and investors to analyze  the funds generated by Trinidad's principal business activities prior to  consideration of working capital, which is primarily made up of highly liquid  balances. This balance is reported in the Consolidated Statements of Cash  Flows included in the cash provided by operating activities section.  "Operating income" is used by management and investors to analyze overall and  segmented operating performance.  Operating income is not intended to  represent an alternative to net earnings or other measures of financial  performance calculated in accordance with IFRS.  Operating income is  calculated from the consolidated statements of operations and comprehensive  income (loss) and from the segmented information contained in the notes to the  consolidated financial statements. Operating income is defined as revenue less  operating expenses.  "Operating income percentage" is used by management and investors to analyze  overall and segmented operating performance, including third party recovery  and third party costs, as well as inter-segment revenue and inter-segment  operating costs. Operating income percentage is calculated from the  consolidated statements of operations and comprehensive income (loss) and from  the segmented information in the notes to the consolidated financial  statements. Operating income percentage is defined as operating income divided  by revenue.  "Operating income - net percentage" is used by management and investors to  analyze overall and segmented operating performance excluding third party  recovery and third party costs, as well as inter-segment revenue and  inter-segment operating costs, as these revenues and expenses do not have an  effect on consolidated net earnings. Operating income - net percentage is  calculated from the consolidated statements of operations and comprehensive  income (loss) and from the segmented information in the notes to the  consolidated financial statements. Operating income - net percentage is  defined as operating income less third party G&A expenses divided by revenue  net of operating and G&A third party costs.  Trinidad is a corporation focused on sustainable growth that trades on the  Toronto Stock Exchange under the symbol TDG. Trinidad's divisions operate in  the drilling and barge-drilling sectors of the North American oil and natural  gas industry with operations in Canada, the United States and Mexico.  Additionally, up until June 30, 2013, Trinidad's operations included coring  rigs which have subsequently been sold. In addition, through a joint venture  agreement signed in the current period, Trinidad has the opportunity to  operate drilling rigs in other international markets such as Saudi Arabia.   Trinidad is focused on providing modern, reliable, expertly designed equipment  operated by well-trained and experienced personnel. Trinidad's drilling fleet  is one of the most adaptable, technologically advanced and competitive in the  industry.  FORWARD-LOOKING STATEMENTS  This document contains certain forward-looking statements relating to  Trinidad's plans, strategies, objectives, expectations and intentions.  The  use of any of the words "expect", "anticipate", "continue", "estimate",  "objective", "ongoing", "may", "will", "project", "should", "believe",  "plans", "intends", "confident", "might" and similar expressions are intended  to identify forward-looking information or statements. Various assumptions  were used in drawing the conclusions or making the projections contained in  the forward-looking statements throughout this document. The forward-looking  information and statements included in this document are not guarantees of  future performance and should not be unduly relied upon.  Forward-looking  statements are based on current expectations, estimates and projections that  involve a number of risks and uncertainties, which could cause actual results  to differ materially from those anticipated and described in the  forward-looking statements. Such information and statements involve known and  unknown risks, uncertainties and other factors that may cause actual results  or events to differ materially from those anticipated in such forward-looking  information or statements. In particular, but without limiting the foregoing,  this document may contain forward-looking information and statements  pertaining to the completion of announced rig construction programs on a  timely basis and economical terms; the assumption that Trinidad's customers  will honour their take-or-pay contracts; fluctuations in the demand for  Trinidad's services; the ability for Trinidad to attract and retain qualified  personnel, in particular field staff to crew the Company's rigs; the existence  of competitors, technological changes and developments in the oilfield  services industry; the existence of operating risks inherent in the oilfield  services industry; assumptions respecting capital expenditure programs and  other expenditures by oil and gas exploration and production companies;  assumptions regarding commodity prices, in particular oil and natural gas;  assumptions respecting supply and demand for commodities, in particular oil  and natural gas; assumptions regarding foreign currency exchange rates and  interest rates; the existence of regulatory and legislative uncertainties; the  possibility of changes in tax laws; and general economic conditions including  the capital and credit markets; assumptions made about future performance and  operations of the joint venture arrangement. Trinidad cautions that the  foregoing list of assumptions, risks and uncertainties is not exhaustive. The  forward-looking information and statements contained in this document speak  only as of the date of this document and Trinidad assumes no obligation to  publicly update or revise them to reflect new events or circumstances, except  as may be required pursuant to applicable securities laws.    SOURCE  Trinidad Drilling Ltd.  Lyle Whitmarsh, Chief Executive Officer  Brent Conway, President  Lisa Ottmann Vice President, Investor Relations (403) 294-4401  email:lottmann@trinidaddrilling.com  To view this news release in HTML formatting, please use the following URL:  http://www.newswire.ca/en/releases/archive/May2014/07/c6346.html  CO: Trinidad Drilling Ltd. ST: Alberta NI: OIL ERN CONF