Enterprise Group, Inc (TSX: E | OTCQB: ETOLF) (the “Company” or “Enterprise”). Consolidator of energy service (including specialized equipment rental to the energy/resource sector) emphasizes technologies that mitigate, reduce, or eliminate CO2 and Green House Gas (GHG) emissions for small local and Tier One global resource clients.
The Company’s Q4 and 2022 YoY earnings against the equivalent periods of 2021 are nothing short of exceptional. And the Company said that Q1 2023 is also shaping up to be very robust.
Audited numbers don’t lie.
Take a moment and digest these stats. If you own the shares, you should be impressed. If not, consider a second look. Once viewed, take in the Company’s very recent Letter to Shareholders detailing the impressive growth potential of the Canadian Oil and Gas industry. Enterprise is a significant source of on-site infrastructure supply and management that facilitates growth.
Here are the numbers. The comprehensive earnings can be seen in Monday morning’s comprehensive Press Release (March 20/23). The most exciting stat compares the YoY 2021 per share loss of (0.05) cents to the equivalent 2022 gain of 0.05 cents: A 200% movement of an overall 10 cents.
Enterprise shares trade at approximately CDN$0.40. For Investors and Shareholders, the Company keeps its LinkedInpage up to date with articles, videos, and commentary. Consider a Follow.
As well, the Company’s YouTube page is very informative. There will be new videos later this week.
OVERALL PERFORMANCE AND RESULTS OF OPERATIONS
| Three months December 31, 2022 | Three months December 31, 2021 | Year ended December 31, 2022 | Year ended December 31, 2021 | |||||
| Revenue | $8,734,471 | $5,730,978 | $26,892,249 | $18,732,335 | ||||
| Gross margin | $4,157,875 | 48% | $2,120,460 | 37% | $10,879,928 | 40% | $6,631,818 | 35% |
| Adjusted gross margin(1)(2) | $4,157,875 | 48% | $2,091,874 | 37% | $10,879,928 | 40% | $4,982,731 | 27% |
| Adjusted EBITDA(1)(2) | $3,283,612 | 37% | $1,547,549 | 27% | $8,149,223 | 30% | $2,962,020 | 16% |
| Net income (loss)and comprehensive income (loss) | $1,788,428 | $126,582 | $2,275,495 | $(2,375,818) | ||||
| Income (loss) per share – Basic and diluted | $0.03 | $0.00 | $0.05 | $(0.05) |
(1) Identified and defined under “Non-IFRS Measures.”
(2) The Canadian Emergency Wage Subsidy and Rent Subsidy Programs ended in October 2021.
To provide further comparability to pre-COVID operations, the Company has presented adjusted gross margin and EBITDA to reflect the results of operations without any subsidy programs.
Enterprise Group Growth Points: FY 2022
· Higher capital spending in the energy industry and increased customer activity levels have resulted in improved results. During the year, Enterprise secured additional supply and services agreements with three of its tier-one clients, contributing to improved operating results.
· The Company believes its stock remains undervalued as the Company’s book value is $0.68 per share. In addition, the Company has available tax losses of $0.17 per share and is developing a consolidated tax plan to utilize those losses. Management will continue to be aggressive in acquiring its shares.
· During the year, Enterprise secured additional supply and services agreements with three of its tier-one clients, contributing to improved operating results.
· During the year ended December 31, 2022, the Company purchased and cancelled 1,799,000 shares at $714,614, or $0.40 per share. These shares had a carrying value of $1.36 per share for $2,445,077, which has been removed from the share capital account. Since initiating the share buyback program, the Company has purchased and cancelled 10,057,500 shares at $2,391,560 or $0.24 per share.
· For the year ended December 31, 2022, the company generated cash flow from operations of $5,910,830 compared to $3,500,869 in the prior year. This change is consistent with the higher activity during the year — equipment fleet to meet customer demands.
· After year end on January 23, 2023, the Company’s common shares began trading on the OTCQB Venture Market under the ticker ETOLF. This listing will help to increase Enterprise’s visibility and accessibility to a growing audience of U.S. investors.
Bottom Line
There is the argument that Enterprise’s numbers are nothing short of extraordinary (use your own adjective). And the coming year, courtesy of increased Oil and Gas Capex spending, stellar management, and new clients with business expansion among existing, including Tier One concerns. As noted in the recent LTS:
Over one year, the Company’s share price rose 40 plus percent, from 26 to 46 cents, a new high. For comparison, S&P lost 19.4%, the Nasdaq gained 8.7%, and the Dow was down almost 9%.
It seems the Company is gaining horsepower, eyeballs, and growth as well as a proxy for the exceptional CAPEX growth.
Stay tuned closely, as Q1 2023 is coming.
Bob Beaty
For over 30 years, Bob Beaty has been explaining concepts and companies to the global investment community. One of the original writers for Jim Cramer’s Thestreet.com, he also wrote for AOL (Can/US), the Globe and Mail, and the Huffington Post. Over that period, he illuminated small-cap companies to investors with wit and pith but mostly opinion and facts. Investing should be fun. Pedantic, staid content is no fun.
Before embarking on his writing career, Bob had a successful international journey in the finance industry. He served as a broker, derivatives product manager, and a Director of London's Credit Suisse subsidiary. His career spanned across major financial hubs including Toronto, Vancouver, and the UK, giving him a unique global perspective. (He is still fondly remembering those English client lunches.)
Other than everything Groucho Marx and George Carlin ever said, Bob lives by a simple credo;
‘Never do anything the person standing in front of you can't understand.’ Hunter S. Thompson.
Let’s go.
