High Arctic Energy Services Inc. (TSX: HWO) posted improved earnings in the second quarter and first half of 2012, due mainly to its operations in Papua New Guinea.
The specialized oilfield equipment and service provider, which is based in Red Deer, said Monday that its net earnings for the three months ended June 30 were $5.7 million.
That compared with a net loss of $100,000 for the same quarter in 2011.
For the six months ended June 30, High Arctic’s net earnings were $16.4 million, up 128 per cent from $7.2 million for the first half of 2011.
These earnings equated to 12 cents a share in the second quarter of 2012, up from zero for the same period last year; and 35 cents per diluted share for the year to date, up from 15 cents.
The 2012 earnings figures included a $5 million positive tax adjustment, which was booked in the second quarter.
High Arctic’s consolidated revenue for the second quarter was $29.6 million, up 19 per cent from $24.9 million a year earlier.
For the first half of 2012, the company’s consolidated revenue was $71.8 million, an 18 per cent improvement over the $60.8 million generated during the same period in 2011.
High Arctic said $25.1 million of its second-quarter revenue and $48.6 million of its January-to-June revenue was generated in Papua New Guinea.
The addition of a new rig in the region and growth in the company’s matting and equipment rental business there helped boost the numbers, it said.
“We are seeing more opportunities in PNG, where the company has already committed $11.3 million in 2012 for growth capital,” said Bruce Thiessen, High Arctic’s chief executive officer.
“That matches the total budgeted amount for 2012, resulting in the board of directors approving a further $6 million for the 2012 PNG capital budget to take advantage of the strong demand for our services in the country.
“The benefits from these new investments will start to accrue in the fourth quarter of 2012 as the new equipment is put into service.”
High Arctic’s Canadian operations contributed $4.5 million in revenue for the second quarter, and $23.2 million for the first half of 2012.
The company said its domestic numbers were helped by strong activity levels in the first quarter and the deployment of a new rig in June. However, production was slowed by adverse weather in the second quarter.
High Arctic announced in May that it was implementing a monthly dividend.
The first such payment, equal to one cent per share, was paid June 14.