- Achieved record Q4 Adjusted EBITDA1 of $162 million ($0.56/basic share1) and $590 million Adjusted EBITDA in 2023 ($1.99/basic share)
- Delivered $0.95/basic share1 in shareholder returns through dividends and share repurchases in 2023
- Repurchased 3.5% of outstanding shares under the renewed NCIB that commenced in December 2023
- Closed $1.150 billion asset sale to Waste Connections, Inc., on February 1, 2024, satisfying the requirements of the Competition Tribunal divestiture order
- Obtained commercial support to double capacity at the newly constructed Clearwater terminal
CALGARY, AB, Feb. 26, 2024 /CNW/ - SECURE Energy Services Inc. ("SECURE" or the "Corporation") (TSX: SES), a leading waste management and energy infrastructure company, reported today its operational and financial results for the three and twelve months ended December 31, 2023.
"2023 was an exceptional year for SECURE, marked by strong financial performance that underscores the stability and growth potential inherent in our core waste management and energy infrastructure operations," said Rene Amirault, Chief Executive Officer of SECURE. "The successful conversion of $590 million of Adjusted EBITDA to $363 million of Discretionary Free Cash Flow1 during the year enabled us to execute on our capital allocation priorities.
"We delivered significant shareholder value in 2023, returning a total of $280 million to shareholders, or $0.95/basic share, through a combination of quarterly dividends and strategic share repurchases. Our opportunistic share buybacks throughout 2023 resulted in a 7% decrease in outstanding shares, contributing to an 11% improvement in Adjusted EBITDA per basic share over 2022. In addition, we successfully executed two critical infrastructure growth projects supported by long-term commercial agreements. These projects provided for the safe and reliable handling of production volumes for our customers, and consistent cash flows for SECURE across our business cycles. Notably, we accomplished these milestones while maintaining a Total Debt to EBITDA2 covenant ratio below 2.0x.
"We also advanced our strategy as a leader in waste management and energy infrastructure. The accretive multiple achieved from the mandated facilities divestiture to Waste Connections highlights the underlying value of SECURE's business. Post-transaction closure, we maintain our market leadership in western Canada and North Dakota, leveraging our extensive facility network to expertly manage waste streams for energy and industrial customers. In 2023, we also strategically optimized our portfolio by divesting of non-core oilfield services business units that did not align with our core infrastructure strategy.
"The proceeds from the asset sale to Waste Connections has significantly improved our financial position, affording us capacity to enhance returns to shareholders and strategically expand in the industrial and energy waste markets. Our Board of Directors and management team continues to believe a substantial disparity exists between our intrinsic value and the current share price. The transaction valuation underscores our conviction that we should trade higher than the current multiple. Therefore, the Corporation remains committed to aggressive NCIB share repurchases, and we will evaluate various avenues, including the merits of a substantial issuer bid, to further return capital to shareholders."
FOURTH QUARTER HIGHLIGHTS
- Entered into a definitive agreement (the "Divestiture Agreement") with Waste Connections, Inc. (through its wholly owned subsidiary) ("Waste Connections") to sell the 29 facilities formerly owned by Tervita Corporation that were ordered to be divested by the Competition Tribunal for $1.075 billion in cash, plus $75 million for certain adjustments as provided in the Divestiture Agreement for total cash proceeds of $1.150 billion. On February 1, 2024, the Corporation closed the sale transaction with Waste Connections (the "Sale Transaction"), which was completed by R360 Environmental Solutions Canada Inc., an affiliate of Waste Connections.
- Generated revenue (excluding oil purchase and resale) of $451 million, an increase of 12% from 2022.
- Achieved Adjusted EBITDA of $162 million or $0.56 per basic share, an increase of 17% on a per basic share basis from 2022.
- Recorded net income of $59 million or $0.20 per share, a 100% increase from $0.10 per basic share in 2022.
- Increased funds flow from operations to $128 million, up 52% from 2022.
- Sold the Corporation's Projects business unit, focused on mobile yellow iron used for demolition and remediation. This sale completed the Corporation's portfolio rationalization of non-core oilfield service focused business units that did not fit into SECURE's core waste management and infrastructure strategy.
- Paid a quarterly dividend of $0.10 per common share, which currently represents an attractive yield of 3.7% on our common shares compared to peers.
- Renewed the Corporation's normal course issuer bid ("NCIB") effective December 14, 2023, which allows the Corporation to repurchase approximately 8.0% of the Corporation's outstanding common shares. The Corporation has repurchased and cancelled 10,076,810 shares since the start of the new NCIB at a weighted average price per share of $9.97 for a total of $100 million.
- Maintained a Total Debt to EBITDA covenant ratio of 1.9x.
ANNUAL HIGHLIGHTS
- Generated revenue (excluding oil purchase and resale) of $1.647 billion, an increase of 7% from 2022.
- Achieved Adjusted EBITDA of $590 million or $1.99 per basic share, an increase of 11% on a per basic share basis from 2022.
- Recorded net income of $195 million or $0.66 per basic share, and increase of 12% on a per basic share basis from 2022.
- Increased funds flow from operations to $474 million, up 18% from 2022.
- Maintained an industry leading Adjusted EBITDA margin1 of 36%.
- Completed and commissioned the expansion of our Montney water disposal infrastructure and Clearwater oil terminalling and gathering infrastructure projects safely, on time and on budget.
- Repurchased and cancelled approximately 23 million common shares at a weighted average price per share of $7.10 for a total of $163 million.
- Progressed our short-term target to reduce emissions associated with our operations by 15%. Since 2021, the Corporation has reduced Scope 1 and Scope 2 emissions at our waste processing facilities by 9% through energy conservation programs.
- Recorded zero lost time injuries, and reduced our recordable injury frequency by 36% over 2022.
- Introduced our WiQ application, a transparent e-ticketing system that ensures compliance and standardization for the documentation of waste and recyclables. WiQ provides an innovative solution that will help maximize the efficiency of compliant operations, assist with product logistics and provide the necessary information to support waste and emissions reporting for our customers.
The Corporation's operating and financial highlights for the three and twelve months ended December 31, 2023 and 2022 can be summarized as follows:
Three months ended | Twelve months ended | |||||
($ millions except share and per share data) | 2023 | 2022 | % change | 2023 | 2022 | % change |
Revenue (excludes oil purchase and resale) | 451 | 401 | 12 | 1,647 | 1,534 | 7 |
Oil purchase and resale | 1,889 | 1,624 | 16 | 6,597 | 6,468 | 2 |
Total revenue | 2,340 | 2,025 | 16 | 8,244 | 8,002 | 3 |
Adjusted EBITDA (1) | 162 | 150 | 8 | 590 | 557 | 6 |
Per share ($), basic (1) | 0.56 | 0.48 | 17 | 1.99 | 1.80 | 11 |
Per share ($), diluted (1) | 0.55 | 0.48 | 15 | 1.97 | 1.78 | 11 |
Net income | 59 | 32 | 84 | 195 | 184 | 6 |
Per share ($), basic | 0.20 | 0.10 | 100 | 0.66 | 0.59 | 12 |
Per share ($), diluted | 0.20 | 0.10 | 100 | 0.65 | 0.59 | 10 |
Funds flow from operations | 128 | 84 | 52 | 474 | 403 | 18 |
Per share ($), basic | 0.44 | 0.27 | 63 | 1.60 | 1.30 | 23 |
Per share ($), diluted | 0.44 | 0.27 | 63 | 1.58 | 1.29 | 22 |
Discretionary free cash flow (1) | 96 | 74 | 30 | 363 | 348 | 4 |
Per share ($), basic(1) | 0.33 | 0.24 | 38 | 1.23 | 1.12 | 10 |
Per share ($), diluted (1) | 0.33 | 0.24 | 38 | 1.21 | 1.11 | 9 |
Capital expenditures (3) | 33 | 34 | (3) | 203 | 96 | 111 |
Dividends declared per common share | 0.1000 | 0.1000 | — | 0.4000 | 0.1225 | 227 |
Total assets | 2,844 | 2,840 | — | 2,844 | 2,840 | — |
Long-term liabilities | 1,186 | 1,115 | 6 | 1,186 | 1,115 | 6 |
Common shares - end of year | 287,627,549 | 309,381,452 | (7) | 287,627,549 | 309,381,452 | (7) |
Weighted average common shares: | ||||||
Basic | 288,968,141 | 309,956,766 | (7) | 295,909,340 | 309,637,322 | (4) |
Diluted | 293,212,504 | 314,248,785 | (7) | 299,086,393 | 313,167,037 | (4) |
1 Non-GAAP financial measure/ratio. Refer to the "Non-GAAP and other specified financial measures" section herein. |
2 Calculated in accordance with the Corporation's credit facility agreements. Refer to the Q4 2023 Management's Discussion and Analysis ("MD&A"). |
3 The Corporation classifies capital expenditures as either growth, acquisition or sustaining capital. Refer to "Operational Definitions" in the MD&A for further information. |
OUTLOOK
Following the Sale Transaction, SECURE remains the market share leader in western Canada, and expects to continue to deliver industry leading margins, and a stable cash flow profile underpinned by recurring volumes driven by industrial waste, metals, and energy markets.
2024 Expectations
SECURE expects activity levels to remain robust in both the energy and industrial sectors for 2024. Our Canadian and North Dakota customers continue to demonstrate disciplined and modest production growth within cash flow, while maintaining balance sheet strength, cost optimization efforts and operational efficiencies. With the completion of the Trans Mountain Expansion Pipeline expected in mid-2024, and commissioning of LNG Canada's LNG export terminal expected by early 2025, increased capacity for our customers to gain stronger pricing with access to global markets is expected to result in sustained and growing activity levels in the years to come. Furthermore, the industrial sector is expected to remain stable, characterized by sustained volumes, continued demand for our infrastructure services and activity linked to long-term and recurring projects.
Financial Guidance
Consistent with previous guidance, the Corporation expects to generate between $440-$465 million of Adjusted EBITDA in 2024. Excluding Corporate costs, SECURE anticipates approximately 70% of Adjusted EBITDA will be attributable to the Environmental Waste Management reporting segment in 2024, with the remaining approximately 30% of Adjusted EBITDA generated from the Energy Infrastructure segment.
In 2024, the Sale Transaction is anticipated to have a lesser impact on Discretionary Free Cash Flow compared to 2023, despite the expected Adjusted EBITDA change. This difference results from reduced sustaining capital and asset retirement obligations due to fewer facilities post-Sale Transaction. Additionally, lower interest expense is expected as significant Sale Transaction proceeds are allocated towards debt repayment.
The Corporation's infrastructure network maintains significant capacity to support customers, accommodating increased volumes for processing, disposal, recycling, recovery, and terminalling, driving higher same store sales with minimal incremental fixed costs or additional capital. SECURE also continues to realize a sizable organic opportunity set to partner with our customers in areas where infrastructure and additional capacity are required to match production growth.
SECURE continues to have $50 million allocated for growth opportunities in 2024, with confirmed commercial support for expansion at the newly constructed Clearwater heavy oil terminal. The terminal began commercial operations in the fourth quarter of 2023. The expansion is backstopped by both existing and new customers and will approximately double the terminal capacity to over 60,000 barrels per day. Construction activities are expected to be completed and operational in the second quarter of 2024. Remaining high probability growth opportunities in 2024 are also expected to leverage existing infrastructure through long-term contracts. The Corporation intends to update its growth plans and provide further details following the entering of agreements with its customers.
The Corporation also continues to expect to spend approximately $60 million on sustaining capital including landfill expansions, and approximately $15 million on settling SECURE's abandonment retirement obligations.
Capital Allocation
The Sale Transaction resulted in significant proceeds of $1.075 billion in cash, along with $75 million for certain adjustments as provided in the Divestiture Agreement for total cash proceeds of $1.150 billion, providing SECURE with significant capital allocation flexibility. The receipt of these proceeds has provided immediate liquidity for debt repayment, while maintaining significant leverage capacity and a surplus of cash available for various purposes, including shareholder returns and funding of growth initiatives.
Debt Repayment
SECURE has repaid the entire amount drawn on the $800 million Revolving Credit Facility with proceeds from the Sale Transaction. On February 22, 2024, the Corporation also redeemed the US$153 million outstanding balance of 11% Senior Second Lien Secured Notes due 2025 at a redemption price of 105.5% of the principal amount of the notes, plus accrued and unpaid interest up to, but excluding, the redemption date.
In addition, SECURE intends to redeem the outstanding $340 million aggregate principal amount of 7.25% Senior Unsecured Notes due December 30, 2026 (the "Notes") in the coming weeks. In accordance with the provisions of the indenture governing the Notes, SECURE may redeem all or any part of the Notes, upon not less than 15 nor more than 60 days' notice, at 103.625% of the principal amount of the Notes, plus accrued and unpaid interest up to, but excluding the redemption date. Redeeming the Notes will alleviate restrictive covenants associated with shareholder returns.
Share Repurchases
SECURE received approval from the Toronto Stock Exchange for an NCIB to repurchase approximately 8.0% of our outstanding shares as at December 8, 2023, or 10% of the Corporation's public float, which commenced on December 14, 2023. The NCIB will terminate on December 13, 2024, or such earlier date as the maximum number of common shares are purchased pursuant to the NCIB or terminated at the Corporation's election. The Board of Directors and management believe there is a substantive disparity between SECURE's share price and the fundamental value of the business. The Sale Transaction valuation underscores this disconnect, and provides compelling evidence that the Corporation's stock should be valued above this benchmark.
As such, SECURE intends to continue to actively repurchase shares under the NCIB, and will evaluate other methods that may be available to reduce this valuation gap and return capital to shareholders, which may include consideration of the merits of a substantial issuer bid, based on, among other things, market conditions, the discretion of the Board of Directors, compliance with debt covenants and financial performance at the applicable time.
Dividend
The Corporation intends to continue paying its quarterly dividend of $0.10 per share, or $0.40 per share on an annualized basis, which currently provides an attractive 3.7% dividend yield compared to peers.
Growth
The Corporation plans to execute on growth opportunities, both organically, and through acquisitions that align with the Corporation's investment criteria and complement its core waste management and energy infrastructure business operations. Execution of growth expenditures will depend on signing agreements with customers to backstop the investments, and acquisition opportunities present.
Looking Ahead
SECURE remains committed to being the leader in waste management and energy infrastructure, prioritizing value creation for our customers through reliable, safe, and environmentally responsible infrastructure. This strategic approach allows our customers to allocate their capital where it can yield the highest return while emphasizing operational excellence and strong ESG standards.
Proceeds from the Sale Transaction, as well as continued strong free cash flow generation, provides the Corporation with significant capital allocation optionality for 2024 and beyond. SECURE is well positioned to grow the business and deliver incremental shareholder returns, all while maintaining low leverage. The Corporation has a strong team of dedicated employees in place to execute on these objectives, while continuing to provide best-in-class customer service.
NON-GAAP AND OTHER SPECIFIED FINANCIAL MEASURES
The Corporation uses accounting principles that are generally accepted in Canada (the issuer's "GAAP"), which includes International Financial Reporting Standards ("IFRS"). This news release contains certain supplementary non-GAAP financial measures, such as Adjusted EBITDA and Discretionary Free Cash Flow and certain non-GAAP financial ratios, such as Adjusted EBITDA Margin, Adjusted EBITDA per share, and Discretionary Free Cash Flow per share which do not have any standardized meaning as prescribed by IFRS. These measures are intended as a complement to results provided in accordance with IFRS. The Corporation believes these measures provide additional useful information to analysts, shareholders and other users to understand the Corporation's financial results, profitability, cost management, liquidity and ability to generate funds to finance its operations.
However, these measures should not be used as an alternative to IFRS measures because they are not standardized financial measures under IFRS and therefore might not be comparable to similar financial measures disclosed by other companies. See the "Non-GAAP and other specified financial measures" section of the Corporation's MD&A for the three and twelve months ended December 31, 2023 and 2022 for further details, which is incorporated by reference herein and available on SECURE's profile at www.sedarplus.ca and on our website at www.SECURE-energy.com.
In this press release, the Corporation has also reported shareholder returns delivered in 2023, and returns per basic share, which do not have any standardized meaning as prescribed by IFRS. Shareholder returns are calculated as the sum of dividends paid and share repurchases made. Returns per basic share is calculated as shareholder returns divided by basic weighted average common shares.
Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted EBITDA per share
Adjusted EBITDA is calculated as noted in the table below and reflects items that the Corporation considers appropriate to adjust given the irregular nature and relevance to comparable operations. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue (excluding oil purchase and resale). Adjusted EBITDA per basic and diluted share is defined as Adjusted EBITDA divided by basic and diluted weighted average common shares.
The following table reconciles the Corporation's net income, being the most directly comparable financial measure disclosed in the Corporation's financial statements, to Adjusted EBITDA for the three and twelve months ended December 31, 2023 and 2022.
Three months ended | Twelve months ended | |||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | |
Net income | 59 | 32 | 84 | 195 | 184 | 6 |
Adjustments: | ||||||
Depreciation, depletion and amortization (1) | 52 | 49 | 6 | 203 | 178 | 14 |
Current tax expense | (4) | — | (400) | 2 | — | 200 |
Deferred tax expense | 23 | 23 | — | 60 | 68 | (12) |
Share-based compensation (1) | 7 | 5 | 40 | 26 | 19 | 37 |
Interest, accretion and finance costs | 24 | 24 | — | 96 | 97 | (1) |
Unrealized loss (gain) on mark to market transactions (2) | (12) | 1 | (1,300) | (6) | (1) | (500) |
Other expense (income) | 10 | 1 | 900 | — | (25) | 2,500 |
Transaction and related costs | 3 | 15 | (80) | 14 | 37 | (62) |
Adjusted EBITDA | 162 | 150 | 8 | 590 | 557 | 6 |
(1) Included in cost of sales and/or G&A expenses on the Consolidated Statements of Comprehensive Income. | ||||||
(2) Includes amounts presented in revenue on the Consolidated Statements of Comprehensive Income. | ||||||
Discretionary Free Cash Flow and Discretionary Free Cash Flow per share
Discretionary Free Cash Flow is defined as funds flow from operations adjusted for sustaining capital expenditures, and lease payments. The Corporation may deduct or include additional items in its calculation of Discretionary Free Cash Flow that are unusual, non-recurring, or non-operating in nature. Discretionary Free Cash Flow per basic and diluted share is defined as Discretionary Free Cash Flow divided by basic and diluted weighted average common shares. For the three and twelve months ended December 31, 2023 and 2022, transaction and related costs have been adjusted as they are costs outside the normal course of business.
The following table reconciles the Corporation's funds flow from operations, being the most directly comparable financial measure disclosed in the Corporation's financial statements, to Discretionary Free Cash Flow.
Three months ended December 31, | Twelve months ended December 31, | |||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | |
Funds flow from operations | 128 | 84 | 52 | 474 | 403 | 18 |
Adjustments: | ||||||
Sustaining capital (1) | (19) | (21) | (10) | (89) | (69) | 29 |
Lease liability principal payments and other | (16) | (4) | 300 | (36) | (23) | 57 |
Transaction and related costs | 3 | 15 | (80) | 14 | 37 | (62) |
Discretionary free cash flow | 96 | 74 | 30 | 363 | 348 | 4 |
1 The Corporation classifies capital expenditures as either growth, acquisition or sustaining capital. Refer to "Operational Definitions" in the MD&A for further information. |
FINANCIAL STATEMENTS AND MD&A
The Corporation's annual audited consolidated financial statements and notes thereto for the years ended December 31, 2023 and 2022 and MD&A for the three and twelve months ended December 31, 2023, are available on SECURE's website at www.secure-energy.com and on SEDAR+ at www.sedarplus.ca.
FOURTH QUARTER AND YEAR-END 2023 CONFERENCE CALL
SECURE will host a conference call Monday, February 26, 2024, at 9:00 a.m. MST to discuss the fourth quarter and year-end results. To participate in the conference call, dial 416-764-8650 or toll free 1-888-664-6383. To access the simultaneous webcast, please visit www.SECURE-energy.com. For those unable to listen to the live call, a taped broadcast will be available at www.SECURE-energy.com and, until midnight MST on Monday, March 4, 2024, by dialing 1-888-390-0541 and using the pass code 876018.
FORWARD-LOOKING STATEMENTS
Certain statements contained or incorporated by reference in this press release constitute "forward-looking statements and/or "forward-looking information" within the meaning of applicable securities laws (collectively referred to as "forward-looking statements"). When used in this press release, the words "achieve", "advance", "anticipate", "believe", "can be", "capacity", "commit", "continue", "could", "deliver", "drive", "enhance", "ensure", "estimate", "execute", "expect", "focus", "forecast", "forward", "future", "goal", "grow", "integrate", "intend", "may", "maintain", "objective", "ongoing", "opportunity", "outlook", "plan", "position", "potential", "prioritize", "realize", "remain", "result", "seek", "should", "strategy", "target" "will", "would" and similar expressions, as they relate to SECURE, its management are intended to identify forward-looking statements. Such statements reflect the current views of SECURE and speak only as of the date of this press release.
In particular, this press release contains or implies forward-looking statements pertaining but not limited to: SECURE's expectations and priorities for 2024 and beyond and its ability and position to achieve such priorities; lower interest expenses; debt repayment; growth opportunities in 2024; construction activities on the Clearwater heavy oil terminal and expected timing of the second phase operation; allocation of spending of the capital budget, including on landfill expansions and retirement obligations; repurchase of shares under the NCIB; ability of the Corporation to reduce the valuation gap of the common shares; capacity to enhance returns to shareholders and the ability to strategically expand in the industrial and energy waste markets; higher volumes and activity levels; shifting supply and demand dynamics driving commodity price volatility; stability in the industrial sector; SECURE's business and demand for SECURE's products and services for 2024; opportunities as a result of production growth; SECURE's infrastructure network capacity and costs to meet growing demand; SECURE's long-term take or pay contracts; the amounts and purposes of capital expenditures in 2024; discipline and modest production growth by the Corporation's customers; capital allocation priorities, including capital structure improvements, repayment of debt, payment of dividends and the amounts thereof, growing our base infrastructure with customer-backed contracts and opportunistic share repurchases; directing significant discretionary free cash toward capital allocation priorities; the effect of the effect of expanded access from the Trans Mountain Expansion Project, LNG Canada, and new natural gas liquids marine export terminals on domestic production; long-term investment by energy producers, resulting in sustained and growing activity levels; the impact of the Sale Transaction on discretionary free cash compared to 2023; SECURE's position to benefit from increased activity for the long-term; the benefit of recurring volumes on SECURE's industrial landfills as a result of government regulations; the stability and resilience of SECURE's operations and the drivers thereof; the redemption of the Notes and anticipated timing and price thereof and the ability of the redemption to alleviate restrictive covenants associated with shareholder returns; the Corporation's ability to capitalize on its strategic initiatives and divestitures; increased industry activity, including related to abandonment, remediation and reclamation and the impacts thereof; expected capital expenditures and the timing of the completion of projects related thereto; the contribution of completed projects to SECURE's results and the timing thereof; SECURE's ability to repay debt and achieve its near-term debt targets; sustained inflationary pressures and increased interest rates, their impact on SECURE's business and SECURE's ability to manage such pressures; the impact of new or existing regulatory requirements, including mandatory spend requirements for retirement obligations, on SECURE's business, and the introduction of such requirements; seasonal slowdowns in energy industry activity; SECURE's dividend policy, the declaration, timing and amount of dividends thereunder and the continued monitoring of such policy by the Board and management; the Corporation's ability to fund its capital needs and the amount thereof; methods and sources of liquidity to meet SECURE's financial obligations, including adjustments to dividends, drawing on credit facilities, issuing debt, obtaining equity financing or divestitures; SECURE's liquidity position and access to capital; and maintaining financial resiliency; SECURE's vision of being a leader in environmental and energy infrastructure; value creation for SECURE's customers through reliable, safe, and environmentally responsible infrastructure; SECURE's ability to help their customers achieve operational excellence and leading ESG standards; and the contribution of completed projects to SECURE's results and the timing thereof.
Forward-looking statements are based on certain assumptions that SECURE has made in respect thereof as at the date of this press release regarding, among other things: economic and operating conditions, including commodity prices, crude oil and natural gas storage levels, interest rates, exchange rates, and inflation; ability to enter into signing agreements with customers to backstop the investments and acquisition opportunities present; continued demand for the Corporation's infrastructure services and activity linked to long-term and recurring projects; the changes in market activity and growth will be consistent with industry activity in Canada and the U.S. and growth levels in similar phases of previous economic cycles; the impact of any new pandemic or epidemic and other international or geopolitical events, including government responses related thereto and their impact on global energy pricing, oil and gas industry exploration and development activity levels and production volumes; the ability of the Corporation to realize the anticipated benefits of acquisitions or dispositions; anticipated sources of funding being available to SECURE on terms favourable to SECURE; redemption of the Notes will alleviate restrictive covenants associated with shareholder returns; the success of the Corporation's operations and growth projects; the Corporation's competitive position, operating, acquisition and sustaining costs remaining substantially unchanged; the Corporation's ability to attract and retain customers; that counterparties comply with contracts in a timely manner; that there are no unforeseen events preventing the performance of contracts or the completion and operation of the relevant facilities; current commodity prices, forecast taxable income, existing tax pools and planned capital expenditures; the Corporation's ability to attract and retain customers; that counterparties comply with contracts in a timely manner; that there are no unforeseen material costs in relation to the Corporation's facilities and operations; that prevailing regulatory, tax and environmental laws and regulations apply or are introduced as expected, and the timing of such introduction; increases to the Corporation's share price and market capitalization over the long term; the Corporation's ability to repay debt and return capital to shareholders; the Corporation's ability to obtain and retain qualified personnel (including those with specialized skills and knowledge), technology and equipment in a timely and cost-efficient manner; the Corporation's ability to access capital and insurance; operating and borrowing costs, including costs associated with the acquisition and maintenance of equipment and property; the ability of the Corporation and our subsidiaries to successfully market our services in western Canada and the U.S.; an increased focus on ESG, sustainability and environmental considerations in the oil and gas industry; the impacts of climate-change on the Corporation's business; the current business environment remaining substantially unchanged; present and anticipated programs and expansion plans of other organizations operating in the energy service industry resulting in an increased demand for the Corporation's and our subsidiaries' services; future acquisition and maintenance costs; the Corporation's ability to achieve its ESG and sustainability targets and goals and the costs associated therewith; and other risks and uncertainties described in SECURE's current annual information form and from time to time in filings made by SECURE with securities regulatory authorities.
Forward-looking statements involve significant known and unknown risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether such results will be achieved. Readers are cautioned not to place undue reliance on these statements as a number of factors could cause actual results to differ materially from the results discussed in these forward-looking statements, including but not limited to: general global financial conditions, including general economic conditions in Canada and the U.S.; the effect of any pandemic or epidemic, inflation and international or geopolitical events and governmental responses thereto on economic conditions, commodity prices and the Corporation's business and operations; changes in the level of capital expenditures made by oil and natural gas producers and the resultant effect on demand for oilfield services during drilling and completion of oil and natural gas wells; volatility in market prices for oil and natural gas and the effect of this volatility on the demand for oilfield services generally; a transition to alternative energy sources; the Corporation's inability to retain customers; risks inherent in the energy industry, including physical climate-related impacts; the Corporation's ability to generate sufficient cash flow from operations to meet our current and future obligations; the seasonal nature of the oil and gas industry; increases in debt service charges including changes in the interest rates charged under the Corporation's current and future debt agreements; inflation and supply chain disruptions; the Corporation's ability to access external sources of debt and equity capital and insurance; disruptions to our operations resulting from events out of our control; the timing and amount of stimulus packages and government grants relating to site rehabilitation programs; the cost of compliance with and changes in legislation and the regulatory and taxation environment, including uncertainties with respect to implementing binding targets for reductions of emissions and the regulation of hydraulic fracturing services and services relating to the transportation of dangerous goods; uncertainties in weather and temperature affecting the duration of the oilfield service periods and the activities that can be completed; ability to maintain and renew the Corporation's permits and licenses which are required for its operations; competition; impairment losses on physical assets; sourcing, pricing and availability of raw materials, consumables, component parts, equipment, suppliers, facilities, and skilled management, technical and field personnel; supply chain disruption; the Corporation's ability to effectively complete acquisition and divestiture transactions on acceptable terms or at all; failure to realize the benefits of acquisitions or dispositions and risks related to the associated business integration; risks related to a new business mix and significant shareholder; liabilities and risks, including environmental liabilities and risks inherent in SECURE's operations; the Corporation's ability to invest in and integrate technological advances and match advances of our competition; the viability, economic or otherwise, of such technology; credit, commodity price and foreign currency risk to which the Corporation is exposed in the conduct of our business; compliance with the restrictive covenants in the Corporation's current and future debt agreements; the Corporation's or our customers' ability to perform their obligations under long-term contracts; misalignment with our partners and the operation of jointly owned assets; the Corporation's ability to source products and services on acceptable terms or at all; the Corporation's ability to retain key or qualified personnel, including those with specialized skills or knowledge; uncertainty relating to trade relations and associated supply disruptions; the effect of changes in government and actions taken by governments in jurisdictions in which the Corporation operates, including in the U.S.; the effect of climate change and related activism on our operations and ability to access capital and insurance; cyber security and other related risks; the Corporation's ability to bid on new contracts and renew existing contracts; potential closure and post-closure costs associated with landfills operated by the Corporation; the Corporation's ability to protect our proprietary technology and our intellectual property rights; legal proceedings and regulatory actions to which the Corporation may become subject, including in connection with any claims for infringement of a third parties' intellectual property rights; the Corporation's ability to meet its ESG targets or goals and the costs associated therewith; claims by, and consultation with, Indigenous Peoples in connection with project approval; disclosure controls and internal controls over financial reporting; and other risk factors identified in SECURE's current annual information form and from time to time in filings made by the Corporation with securities regulatory authorities.
The guidance in respect of the Corporation's expectations of Adjusted EBITDA in 2024 in this press release may be considered to be a financial outlook for the purposes of applicable Canadian securities laws. Such information is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available, and which may become available in the future. These projections constitute forward-looking statements and are based on several material factors and assumptions set out above. Actual results may differ significantly from such projections. See above for a discussion of certain risks that could cause actual results to vary. The financial outlook contained in this press release has been approved by management as of the date of this press release. Readers are cautioned that any such financial outlook contained herein should not be used for purposes other than those for which it is disclosed herein. SECURE and its management believe that the financial outlook contained in this press release has been prepared based on assumptions that are reasonable in the circumstances, reflecting management's best estimates and judgments, and represents, to the best of management's knowledge and opinion, expected and targeted financial results. However, because this information is highly subjective, it should not be relied on as necessarily indicative of future results.
Although forward-looking statements contained in this press release are based upon what the Corporation believes are reasonable assumptions, the Corporation cannot assure investors that actual results will be consistent with these forward-looking statements. The forward-looking statements in this press release are made as of the date hereof and are expressly qualified by this cautionary statement. Unless otherwise required by applicable securities laws, SECURE does not intend, or assume any obligation, to update these forward-looking statements.
ABOUT SECURE
SECURE is a leading waste management and energy infrastructure business headquartered in Calgary, Alberta. The Corporation's extensive infrastructure network located throughout western Canada and North Dakota includes waste processing and transfer facilities, industrial landfills, metal recycling facilities, crude oil and water gathering pipelines, crude oil terminals and storage facilities. Through this infrastructure network, the Corporation carries out its principal business operations, including the processing, recovery, recycling and disposal of waste streams generated by our energy and industrial customers and gathering, optimization, terminalling and storage of crude oil and natural gas liquids. The solutions the Corporation provides are designed not only to help reduce costs, but also lower emissions, increase safety, manage water, recycle by-products and protect the environment.
SECURE's shares trade under the symbol SES and are listed on the Toronto Stock Exchange. For more information, visit www.SECURE-energy.com.
TSX Symbol: SES
SOURCE SECURE Energy Services Inc.
