Enterprise Group Announces Results for First Quarter 2024
Enterprise Group, Inc. (OTCQB: ETOLF) announces strong Q1 2024 results, showing revenue of $12,326,288, gross margin of $6,896,344, and adjusted EBITDA of $6,337,853. The company experienced growth in revenue, gross margin, and EBITDA, reflecting increased customer activity and demand for natural gas power generation systems. The cash flow from operations increased to $5,659,666, allowing the company to acquire capital assets and expand operations. Enterprise closed a private placement, raising $6,999,197 to expand its fleet of rental equipment with low emission systems. The company did not repurchase shares but has a book value of $0.88 per share and available tax losses of $0.12 per share.
Strong Q1 2024 results with revenue of $12,326,288, gross margin of $6,896,344, and adjusted EBITDA of $6,337,853, reflecting growth in revenue, gross margin, and EBITDA.
Cash flow from operations increased to $5,659,666, enabling the company to acquire $4,547,987 of capital assets for expanding operations and meeting customer demands.
Closed a private placement, raising $6,999,197 for expanding the fleet of rental equipment with low emission systems, demonstrating the commitment to capital efficiency and growth.
No share repurchases or cancellations during Q1 2024, even though the company has purchased and cancelled 11,336,000 shares previously at a cost of $2,903,646, affecting the share capital account.
The book value per share is $0.88, with available tax losses of $0.12 per share, indicating the need for a consolidated tax plan to utilize those losses effectively.
St. Albert, Alberta--(Newsfile Corp. - May 9, 2024) - Enterprise Group, Inc. (TSX: E) (OTCQB: ETOLF) (the "Company" or "Enterprise"). Enterprise, a consolidator of energy services (including specialized equipment rental to the energy/resource sector), emphasizing technologies that mitigate, reduce, or eliminate CO2 and Greenhouse Gas emissions for small to Tier One resource clients, is pleased to announce its Q1 2024 results.
OVERALL PERFORMANCE AND RESULTS OF OPERATIONS
| | Three months March 31, 2024 | | Three ended March 31, 2023 | | ||||||||
| Revenue | $ | 12,326,288 | $ | 10,008,332 | ||||||||
| Gross margin | $ | 6,896,344 | $ | 5,099,298 | ||||||||
| Adjusted EBITDA(1) | $ | 6,337,853 | $ | 4,392,685 | ||||||||
| Net income and comprehensive income | $ | 3,991,514 | $ | 2,801,335 | ||||||||
| Income per share - Basic | $ | 0.08 | $ | 0.06 | ||||||||
| Income per share - Diluted | $ | 0.07 | $ | 0.06 | |
(1) Identified and defined under "Non-IFRS Measures".
During the first quarter, the Company was able to build upon the momentum from 2023. Market conditions were favourable for the energy sector, resulting in additional drilling, completion, and infrastructure projects. Also, the increasing demand for natural gas power generation systems indicates a shift towards lower emission alternatives. Overall, these factors contributed to the Company's strong results in the first quarter of 2024. Revenue for the three months ended March 31, 2024, was
$12,326,288 compared to$10,008,332 in the prior period, an increase of$2,317,956 or23% . Gross margin for the three months ended March 31, 2024, was$6,896,344 compared to$5,099,298 in the prior period, an increase of$1,797,046 or35% . Adjusted EBITDA for the three months ended March 31, 2024, was$6,337,853 compared to$4,392,685 in the prior period, an increase of $$1,945,168 or44% . Increases in revenue, gross margin and EBITDA for the year, are reflective of increased customer activity in 2024 while maintaining the operating efficiencies of the Company.For the three months ended March 31, 2024, the company generated cash flow from operations of
$5,659,666 compared to$4,965,708 in the prior year. This change is consistent with the higher activity levels during the year and the growing demand for the natural gas power generation. The Company continues to utilize a combination of cash flow and debt to right-size and modernize its equipment fleet to meet customer demands. During the three months ended March 31, 2024, the Company acquired$4,547,987 of capital assets, primarily for natural gas power generation equipment and facilities, upgrading existing equipment, and meeting specific requests from customers. The Company continues to see its customers switching to natural gas as a cleaner and more efficient alternative to diesel, increasing the demand for natural gas generators and micro-grid packages. Also, the Company purchased land to expand operations and is in the process of constructing a new facility in Fort St. John, BC. The total cost of the project is an estimated$5 million , and the construction work commenced in February 2024. The Company is in the process of obtaining a construction mortgage to cover the building costs of the contract. The facility is estimated to be completed by the end of 2024.On March 12, 2024, the Company closed a brokered private placement of 8,234,350 units issued at a price of
$0.85 per unit for aggregate gross proceeds of$6,999,197. Each unit consists of one common share and one-half common share purchase warrant. Each warrant is exercisable to acquire an additional common share at an exercise price of$0.95 per share for a period of 24 months. Of the 8,234,350 units issued under prospectus exemptions, 5,882,350 units are not subject to resale restrictions and the remaining 2,352,000 units are subject to a hold period of 4 months from the date of issuance. In connection with the private placement, the broker received compensation of$419,952 plus 494,061 non-transferable broker options with each broker option consisting of one common share and one-half common share purchase warrant. Each broker option is exercisable to acquire an additional common share at an exercise price of$0.89 per share for a period of 24 months. Each warrant is exercisable to acquire an additional common share at an exercise price of$0.95 per share for a period of 24 months. The Company will use the net proceeds of the Offering to expand its fleet of rental equipment with an emphasis on low emission mobile power systems and for general corporate purposes. The exercise of all warrants will provide the company an additional$4,585,000. This private placement underscores the Company's commitment to efficiently manage capital while continuing to grow and meet customer demands.During the three months ended March 31, 2024, the Company did not repurchase or cancel shares. Since the initiation of the share buyback program, the Company has purchased and cancelled 11,336,000 shares at a cost of
$2,903,646 or$0.26 per share. These shares have a carrying value of$1.41 per share for a total of$15,970,630 which has been removed from the share capital account over the entire share buyback program. The Company renewed its bid on August 24, 2023, with a termination date of August 29, 2024, or such earlier time as the bid is completed or terminated at the option of the Company. As at March 31, 2024, the Company's book value is$0.88 per share. Additionally, the Company has available tax losses of$0.12 per share and is in the process of developing a consolidated tax plan to utilize those losses.
About Enterprise Group, Inc.
Enterprise Group, Inc is a consolidator of services-including specialized equipment rental to the energy/resource sector. The Company works with particular emphasis on systems and technologies that mitigate, reduce, or eliminate CO2 and Greenhouse Gas emissions for itself and its clients. The Company is well known to local Tier One and international resource companies with operations in Western Canada. More information is available at the Company's website www.enterprisegrp.ca. Corporate filings can be found on www.sedarplus.ca. For questions or additional information, please contact:
For questions or additional information, please contact:
Leonard Jaroszuk: President & CEO, or
Desmond O'Kell: Senior Vice-President
contact@enterprisegrp.ca
780-418-4400
Forward Looking Information
Certain statements contained in this news release constitute forward-looking information. These statements relate to future events or the Company's future performance. The use of any of the words "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website www.sedarplus.ca) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The Company disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.
Non-IFRS Measures
The Company uses International Financial Reporting Standards ("IFRS"). EBITDAS is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-IFRS measure. This news release contains references to EBITDAS. This non-IFRS measure used by the Company may not be comparable to a similar measure used by other companies. Management believes that in addition to net income, EBITDAS is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDAS is calculated as net income excluding depreciation, amortization, interest, taxes and stock based compensation.
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FAQ
What were Enterprise Group's Q1 2024 revenue, gross margin, and adjusted EBITDA?
Enterprise Group's Q1 2024 revenue was $12,326,288, gross margin was $6,896,344, and adjusted EBITDA was $6,337,853.
How did Enterprise Group utilize the cash flow from operations during Q1 2024?
Enterprise Group used the cash flow to acquire $4,547,987 of capital assets for expanding its operations and meeting customer demands.
What was the purpose of the private placement closed by Enterprise Group in Q1 2024?
The private placement raised $6,999,197 to expand the fleet of rental equipment with low emission systems, showing a commitment to capital efficiency and growth.
Has Enterprise Group repurchased any shares during Q1 2024?
No, Enterprise Group did not repurchase any shares during Q1 2024, despite having purchased and cancelled 11,336,000 shares previously.
What is the book value per share of Enterprise Group as of Q1 2024?
Enterprise Group's book value per share is $0.88 as of Q1 2024, with available tax losses of $0.12 per share requiring a consolidated tax plan.
