CALGARY, Sept. 29, 2014 /CNW/ - SECURE Energy Services Inc. ("SECURE") (TSX:SES) is pleased to announce it has entered into an amended and restated $700 million syndicated credit facility ("Syndicated Facility") with a syndicate of ten financial institutions and Canadian Chartered banks.
The Syndicated Facility consists of a $675 million extendible revolving term credit facility and a $25 million revolving operating facility that replaces the Corporation's $400 million syndicated facility. The Syndicated Facility can be expanded to $800 million through the exercise of an additional $100 million accordion feature, available upon request by the Corporation subject to review and approval by the lenders.
The Syndicated Facility is a four year, committed facility with an initial maturity date of September 26, 2018 and is extendable annually, at the Corporation's request, provided that the maturity date associated with the granting of the extension does not exceed four years. The facility is secured by substantially all of the Corporation's assets and includes customary terms, conditions and covenants, including that the consolidated senior funded debt to EBITDA ratio does not exceed 3.50 to 1.00, the consolidated total funded debt to EBITDA ratio does not exceed 5.00 to 1.00 and the consolidated EBITDA to financing charges ratio is not less than 2.50 to 1.00.
Amounts borrowed under the Syndicated Facility will bear interest at the Corporation's option of either the Canadian prime rate plus 0.45% to 2.00% or the banker acceptance rate plus 1.45% to 3.00%, depending, in each case, on the ratio of consolidated senior funded debt to EBITDA.
"This increase in our revolving credit facility provides SECURE with the platform to execute on our continued business strategy of constructing and expanding facilities in key under-serviced capacity constrained markets and complementing our array of services along our value chain," said Rene Amirault, SECURE's Chief Executive Officer, "The increase in the credit facility will provide substantial borrowing capacity while still maintaining a solid financial position."
ABOUT SECURE ENERGY SERVICES INC.
SECURE is a TSX publicly traded energy services company that provides safe and environmentally responsible fluids and solids solutions to the oil and gas industry.
The Corporation operates three divisions:
Processing, Recovery and Disposal Division ("PRD"): The PRD division owns and operates midstream infrastructure that provides processing, storing, shipping and marketing of crude oil, oilfield waste disposal and recycling. Specifically these services are clean oil terminalling and rail transloading, custom treating of crude oil, crude oil marketing, produced and waste water disposal, oilfield waste processing, landfill disposal, and oil purchase/resale service. SECURE currently operates a network of facilities throughout western Canada and in North Dakota, providing these services at its full service terminals, landfills and stand-alone water disposal facilities.
Drilling Services Division ("DS"): The DS division provides equipment and chemicals for building, maintaining, processing and recycling of drilling and completion fluids. The drilling fluids service line comprises the majority of the revenue for the division which includes the design and implementation of drilling fluid systems for producers drilling for oil, bitumen and natural gas. The DS division focuses on providing products and systems that are designed for more complex wells, such as medium to deep wells, horizontal wells and horizontal wells drilled into the oil sands.
On Site Division ("OS"): The operations of the OS division include environmental services which provide pre-drilling assessment planning, drilling waste management, remediation and reclamation assessment services, laboratory services, and "CleanSite" waste container services; integrated fluid solutions which include water management, recycling, pumping and storage solutions; and projects which include pipeline integrity (inspection, excavation, repair, replacement and rehabilitation); demolition and decommissioning and reclamation and remediation of former wellsites, facilities, commercial and industrial properties.
NON-GAAP MEASURES
This press release contains references to EBITDA. This financial measure is not a measure that has any standardized meaning prescribed under International Financial Reporting Standards and is therefore referred to as non-GAAP measure. The non-GAAP measure used by the Corporation may not be comparable to a similar measure used by other companies. EBITDA is not a recognized measure under GAAP. Management believes that in addition to net income, EBITDA is a useful supplemental measure as it provides an indication of the results generated by the principal business activities prior to consideration of how those activities are financed or how the results are taxed. EBITDA is calculated as net income excluding depreciation, depletion and accretion, share-based payments, interest, and taxes.
