Foraco International Reports Q4 2018

TORONTO and MARSEILLE, France, March 1, 2019

TORONTO and MARSEILLE, France, March 1, 2019 /CNW/ - Foraco International SA (TSX: FAR) (the "Company" or "Foraco"), a leading global provider of mineral drilling services, released its unaudited financial results for the fourth quarter 2018 today. All amounts are denominated in US Dollars (US$) unless otherwise indicated.

"We would once again like to express our special thoughts for the Company's employees and families who have been victims of a terrorist attack in Niger. Health, safety and security are our absolute priorities and a permanent concern for our management team," stated Daniel Simoncini and Jean-Pierre Charmensat.

"Regarding the performance for the quarter, in the context of a market recovery, we continued to grow with revenue at USD 48.0 million in Q4 2018 versus USD 35.0 million in Q4 2017, a 37 % increase. On an annual basis, we outperformed the market growth with a 33% increase in revenue at USD 180.0 million versus USD 135.7 million in 2017. This is the combined result of our excellent long-standing relationship with Top Tier customers, strong positioning in key markets and our new innovative services including the mechanized flooded reverse dewatering services to mines, the roll out of low angle drilling, remote-control rigs and deep coring directional drilling" commented Daniel Simoncini, Chairman and Co-CEO of Foraco. "The bidding activity is exciting and we are pleased to report that our backlog at year-end is significantly higher than last year at USD 266 million, a 32% increase year on year of which US$133 million to be performed in 2019. Canada, Australia and Russia continue to remarkably benefit from the market upturn and we see interesting development potentials in Latin America, which is expected to be one of the largest and fastest growing market in our industry."

"In Q4 2018, we recorded an EBITDA of USD 4.4 million, a 13% increase compared to Q4 2017. We proved this quarter again our capacity to secure and execute our contracts. Delivery from the revenue side and our capacity to control costs contributed to our improved productivity. Our EBIT is positive this quarter and is also positive on a full year basis. We believe that there is room for a financial recovery, given that market prices have not yet fully recovered and that we have not reached our potential drilling rigs capacity" added Jean-Pierre Charmensat, Co-CEO and Chief Financial Officer. "The activity increase generated additional requirements in working capital and we invested in FY 2018 USD 13.0 million in capex in relation to new contracts. Our net debt as at December 31, 2018 amounts to USD 130.4 million. We intend to take advantage of the improving market conditions to reduce our debt and deleverage our balance sheet."

Q4 2018 Highlights

Revenue