Enterprise Group Announces Results for the Fourth Quarter and Full Year 2024

Rhea-AI Summary

Enterprise Group (TSX: E, OTCQB: ETOLF) reported mixed results for Q4 and FY2024. Q4 revenue decreased 19% to $7.8M from $9.6M year-over-year, with adjusted EBITDA falling 48% to $2.3M. However, full-year 2024 revenue increased 3% to $34.6M.

Key developments include a five-year exclusivity agreement with FlexEnergy Solutions for turbine applications in Alberta and BC, and a $28M capital raise in December 2024. The company repaid its bank loan facility with a $15.7M payment, including a $1.5M settlement discount.

While Q4 2024 activities were below expectations, early 2025 shows improved operations. The company invested $16.9M in capital assets, focusing on natural gas power generation equipment. Enterprise notes increasing customer demand for natural gas generators as a cleaner alternative to diesel, despite some project delays due to the Kitimat LNG plant startup postponement to mid-2025.

Positive

• Secured exclusive 5-year agreement with FlexEnergy Solutions for turbine applications
• Successfully raised $28M capital in December 2024
• Achieved $1.5M discount on bank loan settlement
• Annual revenue increased 3% to $34.6M
• Growing demand for natural gas power generation systems
• Strong cash flow from operations at $12.1M

Negative

• Q4 2024 revenue declined 19% year-over-year to $7.8M
• Q4 2024 adjusted EBITDA fell 48% to $2.3M
• Q4 2024 gross margin decreased 42% to $2.8M
• Project delays due to Kitimat LNG plant startup postponement
• Lower than anticipated Q4 activity levels

St. Albert, Alberta--(Newsfile Corp. - March 20, 2025) - Enterprise Group, Inc. (TSX: E) (OTCQB: ETOLF) (the "Company" or "Enterprise"). Enterprise, a consolidator of energy services (including specialized equipment and services to the energy/resource sector), emphasizes technologies that mitigate, reduce, or eliminate CO2 and Green House Gas (GHG) and other harmful emissions for small local and Tier One resource clients, is pleased to announce its Q4 2024 and FY2024 results.

Enterprise Group - CEO & Chairman, Leonard Jaroszuk comments: "In Q4 of 2024, the company's activities were lower than initially anticipated, falling short of expectations. However, as we transitioned into 2025, we have experienced a significant recovery in our operations, with activity levels showing a marked improvement compared to the previous quarter. This resurgence has positioned the company well for the future. Additionally, with solid financial standing and a well-capitalized balance sheet, the company is now strategically equipped to explore expansion into the mining sector, presenting exciting opportunities for growth in the coming year."

	Three months December 31, 2024		Three months December 31, 2023		Year ended December 31, 2024		Year ended December 31, 2023
Revenue	$7,812,010		$9,598,945		$34,646,888		$33,500,501
Gross margin	$2,825,431	36%	$4,844,194	50%	$15,561,427	45%	$15,501,969	46%
Adjusted EBITDA(1)	$2,272,455	29%	$4,374,735	46%	$13,069,867	38%	$13,285,880	40%
Net income and comprehensive income	$673,207		$2,255,159		$4,543,553		$6,169,904
Income per share - Basic	$0.01		$0.05		$0.07		$0.12
Income per share - Diluted	$0.01		$0.04		$0.07		$0.12
(1) Identified and defined under "Non-IFRS Measures".

 

• During the year, the Company made notable strides to advance its strategy to expand its market presence and to solidify its position as a leader in mobile natural gas power systems. On September 26, 2024, the Company announced a five-year exclusivity agreement with FlexEnergy Solutions, a globally recognized leader in turbine and microturbine power generation equipment. The agreement positions the Company as the exclusive provider of short-term turbine and microturbine applications across all commercial and industrial sectors in Alberta and British Columbia. Additionally, on December 5, 2024, the Company raised capital of $28 million by way of a short-form prospectus to support growth initiatives. This capital raise will enable the Company to strengthen its capabilities, expand market reach and continue to deliver cutting-edge energy solutions to key Canadian markets. Both the exclusivity agreement and the successful capital raise reflect the Company's commitment to expand its market presence and to reinforce its position as a leader in providing innovative and reliable energy solutions.

• On February 28, 2025, the Company repaid its bank loan facility by way of a cash payment of $15,675,574 which included a negotiated settlement discount from the lender in the amount of $1,500,000. Upon receipt of the funds, all securities held by the lender under the credit agreement were released. The Company is currently in the process of negotiating a new bank loan facility with a tier one lender and expects to have it completed in the first quarter of 2025.

• Activity during the first half of the year was high and market conditions were favourable for the energy sector, resulting in additional drilling, completion and infrastructure projects. Also, many of the Company's natural gas producers were preparing for the start-up of the LNG plant in Kitimat, B.C. However, when the target start-up date was pushed to mid 2025, some of the Company's customers adjusted their work plans and as a result, activity in the fourth quarter only increased at a moderate rate. Even though the fourth quarter saw reduced activity, activity levels for the first part of 2025 are higher and are expected to continue throughout the year. The demand for natural gas power generation systems continues to increase and indicates a shift towards lower emission alternatives, and going forward, market conditions remain favourable for the energy sector, resulting in increased drilling, completion, and infrastructure projects.

• Revenue for the three months ended December 31, 2024, was $7,812,010 compared to $9,598,945 in the prior period, a decrease of $1,786,935 or 19%. Revenue for the fourth quarter did increase by 15% over quarter three, however this increase was lower than anticipated. Gross margin for the three months ended December 31, 2024, was $2,825,431 compared to $4,844,194 in the prior period, a decrease of $2,018,763 of 42%. Adjusted EBITDA for the three months ended December 31, 2024, was $2,272,455 compared to $4,374,735 in the prior period, a decrease of $2,102,280 or 48%. Revenue for the year ended December 31, 2024, was $34,646,888 compared to $33,500,501 in the prior period, an increase of $1,146,387 or 3%. Gross margin for the year ended December 31, 2024, was $15,561,427 which is consistent to the prior period. Adjusted EBITDA for the year ended December 31, 2024, was $13,069,866 which is slightly lower, compared to the prior period.

• For the year ended December 31, 2024, the company generated cash flow from operations of $12,132,566 compared to $13,530,272 in the prior year. This change is consistent with revenue levels during the year. The Company continues to utilize a combination of cash flow, debt and equity to right-size and modernize its equipment fleet to meet customer demands. During the year ended December 31, 2024, the Company acquired $16,909,417 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.

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 and other harmful 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.com.

For questions or additional information, please contact:
Leonard Jaroszuk: Chairman & CEO, or
Desmond O'Kell: President & Director
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.sedar.com) 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.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/245353

FAQ

What caused Enterprise Group (ETOLF) Q4 2024 revenue decline?

Q4 2024 revenue declined 19% to $7.8M due to reduced activity levels and project delays related to the postponement of Kitimat LNG plant startup to mid-2025.

How much capital did Enterprise Group (ETOLF) raise in December 2024?

Enterprise Group raised $28 million through a short-form prospectus offering in December 2024 to support growth initiatives.

What is the significance of Enterprise's FlexEnergy Solutions agreement?

The five-year agreement makes Enterprise the exclusive provider of short-term turbine applications across Alberta and British Columbia's commercial and industrial sectors.

How much did Enterprise Group (ETOLF) invest in capital assets in 2024?

Enterprise invested $16.9M in capital assets during 2024, primarily in natural gas power generation equipment and facilities.

What was Enterprise Group's (ETOLF) full-year 2024 revenue performance?

Full-year 2024 revenue increased 3% to $34.6M compared to $33.5M in 2023.