Calfrac profit beats, rev misses on mild winter

Wed May 9, 2012 9:50am EDT
 
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(Reuters) - Calfrac Well Services Ltd CFW.TO reported a higher-than-expected quarterly profit on strong drilling activity in North America, although revenue missed market forecasts as mild winter weather in Canada hampered movement of equipment.

Drillers and well service companies such as Calfrac and Precision Drilling Corp PD.TO rely on frozen ground to move heavy gear across boggy terrain during winter.

Precision Drilling, which reported last month, missed analysts' profit expectations.

However, an early spring break-up in Canada combined with below-average snowfall over the winter could minimize the traditional impact of road bans on activity during the remainder of the second quarter, Calfrac said in a statement.

Calfrac's first-quarter net income attributable to shareholders rose to C$70.8 million ($70.7 million), or C$1.59 per share, from C$49.1 million, or C$1.11 per share, a year earlier.

Revenue rose 41 percent to C$474.1 million. Canada and United States account for 90 percent of the company's revenue.

Analysts on average had expected earnings of C$1.40 per share on revenue of C$501.85 million.

Adjusting for foreign exchange gains, the company earned C$1.33 per share.

(This story has been corrected to show the company beat profit expectations based on Thomson Reuters I/B/E/S calculations, which include foreign exchange gains. Rewrites headline, and first paragraph to conform.)

(Reporting by Aftab Ahmed in Bangalore; Editing by Sriraj Kalluvila)