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Gemini Corporation Reports Fiscal 2014 Results
Record Revenue in a Challenging Market
CALGARY, AB--(Marketwired - March 03, 2015) - Gemini Corporation (TSX VENTURE: GKX) today announced its financial results for the fiscal year ended December 31, 2014 and the grant of options and units to officers and directors.
Revenue for 2014 increased 28% to $144 million from $112 million in 2013. Fourth quarter revenue increased 45% to $48 million compared to $33 million in the same period last year. The strong fourth quarter result was driven primarily by the rail loading facility project that was announced and commenced in the third quarter for one of Gemini's alliance clients. This project has had a positive impact on revenue for the year and is expected to provide a strong backlog of work for the Corporation's Field Solutions segment through to mid-2015. The success of this project is spawning increasing interest in the Corporation's Design-Build execution capabilities, in what is a very challenging market due to the industry constraints on capital spending.
Gross profit for 2014 totalled $22 million, which was a 6% increase over the $21 million earned in the prior year. Unfortunately, gross profit as a percent of revenue declined to 15.2% from 18.4% as a result of the much more competitive pricing environment that has been experienced throughout 2014. The rapid decline of commodity prices through the latter half of 2014 has created significant pressure to reduce costs across the oil and gas industry. The Corporation's actions to align costs to revenue over the course of the year were proven to be insufficient to fully address the margin compression. Further actions have recently been taken to reduce staffing, pay rates and other variable costs. Management is monitoring industry information carefully to position the organization for success as the market stabilizes and begins to recover.
Net earnings for 2014 were $3.0 million (4.8¢ per share) compared to the net earnings of $3.3 million (6.1¢ per share) earned in 2013. Fourth quarter earnings were $1.5 million (2.0¢ per share) compared to $0.7 million (1.3¢ per share) in 2013.
"We are very pleased with our financial performance in the fourth quarter of 2014, given the prevailing market conditions," stated Gemini's President and CEO, Doug Lautermilch. "It is bitter sweet being able to report record revenue for Gemini at a time when there is such turmoil in the industry. We are optimistic that our Design-Build service model is gaining attention and expect to be announcing additional projects of this nature in the near future. We sincerely believe we are distinguishing ourselves from our competitors and will be able to continue our growth path as the industry recovers from the current downturn in activity."
CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||
Operating Highlights ($'000) | Three Months Ended | Year Ended | ||||||
Dec 31, | Dec 31, | Dec 31, | Dec 31, | |||||
Revenue | $ 48,460 | $ 33,326 | $ 143,953 | $ 112,141 | ||||
Gross profit | 7,462 | 5,830 | 21,841 | 20,597 | ||||
Income (loss) before interest & taxes | 2,190 | 1,540 | 4,605 | 4,968 | ||||
Net Income (loss) | $ 1,479 | $724 | $2,968 | $3,350 | ||||
Earnings per share (basic) | $ 0.020 | $ 0.013 | $ 0.048 | $ 0.061 | ||||
Earnings per share (diluted) | $ 0.019 | $ 0.011 | $ 0.041 | $ 0.052 | ||||
Balance Sheet Highlights ($'000) | December 31, | December 31, | ||
Working capital | $ 19,635 | $ 14,489 | ||
Total assets | 65,342 | 41,823 | ||
Shareholders' equity | 30,784 | 21,602 | ||
In addition to the financial results, the Corporation wishes to announce that an aggregate of 448,000 options were granted to certain officers at an exercise price of $0.44 per share, which was the closing market price on March 2, 2015. Under the terms of Gemini's option plan, the options are valid for four years from the date of grant and vest one-third immediately and the remainder at one-third on each of the next two grant date anniversaries. These grants bring the total number of options outstanding to 2,614,000 or 3.4% of the 76,677,832 issued and outstanding common shares of the Corporation. A total of 666,000 performance share units were granted to certain officers and directors with a vesting date of January 1, 2018. The unit plan is structured to settle the performance share units by the issuance of shares on the vesting date. The units granted thereunder are subject to the approval of the TSX Venture Exchange and Gemini's shareholders at the company's next Annual General Meeting.
About Gemini Corporation
Gemini Corporation is a professional services firm that provides engineering, regulatory, fabrication, installation and maintenance solutions for clients through stand-alone or integrated service delivery models. For more than 30 years, Gemini has been harnessing the energy of its staff and clients to power innovation in conventional and unconventional oil and gas, in-situ heavy oil and industrial facilities across western Canada. Our integrated design-build project delivery model differentiates Gemini and provides tremendous value-added benefits for clients, such as constructability advice at the design phase, schedule compression and one point of accountability.
Shares of Gemini trade on the TSX Venture Exchange under the symbol "GKX". For more information about the Corporation and its services, go to www.geminicorp.ca. Gemini's 2014 annual financial report will be filed with SEDAR at http://www.sedar.com on or before March 5, 2015.
Disclaimer
This news release may contain forward looking information that represents Gemini's internal projections, expectations, estimates or beliefs concerning, among other things, future operating results and various components thereof or Gemini's future economic performance. All statements other than the statements of historical fact may be forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expects", "projects", "plans", "anticipates", and similar expressions. The projections, estimates and beliefs contained in such forward-looking statements are based on management's assumptions relating to Gemini's performance and competition within the sectors in which it competes, the continuation of the current regulatory and tax regimes in the jurisdictions in which Gemini operates, and necessarily involve known and unknown risks and uncertainties, including risks and assumptions relating to client service demand, field service costs, labour rates, and other factors that may cause actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted or suggested. The Corporation does not undertake to update any forward-looking information in this document whether as to new information, future events or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
