EANS-News: C.A.T. oil accelerates growth and increases revenues by 24.4% yoy in H1

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quarterly report

Subtitle: • Revenues boosted to EUR 135.0 million in H1
• Total job counts and revenues reached new quarterly high in Q2
• Significant upswing in sidetracking activities in Q2
• Healthy H1 EBITDA margin of 20.0% despite diversification
• Outlook for FY2011 confirmed

Vienna, 30 August 2011 (euro adhoc) - C.A.T. oil AG (O2C, ISIN:
AT0000A00Y78), one of the leading providers of oil and gas field
services in Russia and Kazakhstan, today announced its results for
the first six months of 2011. Supported by favorable macroeconomic
conditions and, therefore, higher customer activity levels, C.A.T.
oil successfully accelerated its business expansion in the second
quarter. The Company increased its total job count by 11.0% yoy to
878 jobs and its total revenues by 20.6% yoy to EUR 74.0 million in
Q2 2011. C.A.T. oil´s job count and revenues hereby not only exceeded
the pre-crisis levels, but also achieved new quarterly all time
highs. Despite current uncertainties over the global economic
developments in the second half of the year, C.A.T. oil is well on
track to attain its expansionary plans and, therefore, confirms its
positive outlook for the financial year 2011.

Manfred Kastner, CEO of C.A.T. oil, commented: "During the second
quarter we successfully advanced our operations and realized a strong
top line growth. In addition, we continued setting up our
conventional drilling business. We are well on track and pleased with
the progress we have made to date. Backed by the strong company
development in the first six months, we are confident for the second
half: We will concentrate on the diversification into our third core
business and will retain a focus on sustaining healthy levels of
profitability and top line growth across the existing businesses."

H1 revenues up 24.4% yoy due to higher activity levels in Q2

During the first half of 2011 C.A.T. oil increased revenues by 24.4%
yoy to EUR 135.0 million (H1 2010: EUR 108.5 million); the Company
particularly benefited from a strong growth in demand for the
existing service offerings and the seasonal upturn in customers´
activities in the second quarter.

During the reporting period the total job count increased by 17.0%
yoy to 1,648 jobs (H1 2010: 1,409 jobs), driven by a 24.4% yoy gain
in the fracturing job count and a 13.9% yoy rise in the sidetracking
job count. In the sidetrack drilling business, the Company was able
to compensate for the delays, which occurred during the first
quarter, and rolled over unexecuted orders, thus boosting the job
count by 44.1% yoy in Q2. During the first six months the auxiliary
job count stayed effectively flat yoy upon the completion of the
outsourcing of the low margin workover business in Q2.

C.A.T. oil´s average per job revenue staged a 7.7% yoy increase to
TEUR 81 (H1 2010: TEUR 76) in the wake of the improved fracturing
prices and a marginally stronger Russian rouble relative to the euro.

Cost base driven by higher operating activities and the front loaded
costs for business expansion

During the first six months of 2011 cost of sales went up 30.1% yoy
to EUR 116.0 million (H1 2010: EUR 89.2 million) and were impacted by
four effects: significantly higher operating activity levels in the
fracturing and sidetracking businesses, the Q1 setbacks in
sidetracking activities, the completion of the outsourcing processes
in the workover business and the front-loaded costs for the expansion
into high class conventional drilling. The set up of this business,
which will become C.A.T. oil´s third core service line, is well on
track. The first conventional drilling rig was delivered to Russia in
Q2 and was put into operation in July. Eight more rigs will be
delivered to Russia during the second half of 2011 and four of them
are scheduled to become operational by the end of the year.

General and administrative expenses increased 4.9% yoy to EUR 9.6
million (H1 2010: EUR 9.1 million), primarily due to the
expansion-related costs such as additional wages and salaries,
travelling and training expenses. The total weighted average
headcount went down 3.8% yoy to 2,362 employees (H1 2010: 2,455
employees). This development reflected, on the one hand, the new
hires for the set up of the new business and, on the other hand, the
reduction in the headcount upon the complete outsourcing of the
workover operations.

Healthy level of profitability despite expansion into third core
business

C.A.T. oil´s half year earnings also reflect the diversification into
conventional drilling: Although the Company realized a strong revenue
growth, the investment-related expenses were not fully offset.
Nonetheless, gross profit and EBITDA remained stable compared to H1
2010 and amounted to EUR 19.0 million (H1 2010: EUR 19.3 million) and
EUR 27.0 million (H1 2010: EUR 26.8 million), respectively. Although
the EBITDA margin declined compared to the prior year period, it
remained at a healthy level of 20.0% (H1 2010: 24.7%). EBIT declined
19.4% yoy to EUR 10.0 million (H1 2010: EUR 12.4 million), primarily
reflecting higher depreciation expenses related to investments in new
operating capacity. C.A.T. oil´s net income amounted to EUR 6.9
million (H1 2010: EUR 8.5 million), owing to a lower financial result
mainly driven by a decrease in the Company´s foreign currency
exchange gain.

Capital expenditure primarily funded through cash flow

During the reporting period, funds from operations went down 9.2% yoy
to EUR 23.7 million (H1 2010: EUR 26.1 million) largely due to a
lower pre-tax profit. Cash flow from operating activities amounted to
a net inflow of EUR 16.1 million (H1 2010: net inflow of EUR 33.5
million). Capital expenditure increased to EUR 44.4 million (from EUR
12.4 million in H1 2010) due to the payments for the new rigs. Cash
flow from investing activities was a net outflow of EUR 43.4 million
(H1 2010: net outflow of EUR 12.4 million) that included the proceeds
from the sale of equipment of EUR 1.1 million (H1 2010: EUR 3.4
million). Cash flow from financing activities was a net inflow of EUR
17.5 million in H1 2011 (H1 2010: net outflow of EUR 3.8 million),
primarily owing to the increase in long-term and short-term
borrowings.

As of 30 June 2011, cash and cash equivalents amounted to EUR 24.4
million (31 December 2010: EUR 34.1 million). C.A.T. oil´s balance
sheet remained strong with a healthy equity ratio of 72.8% as of 30
June 2011 (31 December 2010: 83.2%).

Outlook for the full year 2011 confirmed

Stock markets have recently been highly volatile, reflecting the
uncertainties about the global economic outlook for the remaining
months of 2011. At this point in time, C.A.T. oil expects the
macroeconomic environment in its core markets, Russia and Kazakhstan,
to remain supportive and operating activities to stay on a high
level. C.A.T. oil is confident that it is well positioned to win
additional orders in the remaining months of 2011 and anticipates the
total revenues for the current financial year to exceed the order
book level of EUR 239 million (based on an exchange rate of 40
roubles per euro) as of August 2011. In addition, C.A.T. oil remains
committed to sustaining profitable growth. Although inflationary
pressures and effects of the business expansion will have an impact
on profitability, the Company remains committed to achieving a 2011
EBITDA margin close to the 2010 level. C.A.T. oil will capitalize on
its strong market position in Russia and Kazakhstan and continue
delivering high quality services to realize further growth.

www.catoilag.com

Press contact:

FD FD
Carolin Amann Thomas Krammer
Phone: +49 (0)69 92037-132 Phone: +49 (0)69 92037-183
Email: carolin.amann@fd.com Email: thomas.krammer@fd.com

About C.A.T. oil AG:

C.A.T. oil AG is one of the leading providers of oil and gas field
services in Russia and Kazakhstan and is listed on the Frankfurt
Stock Exchange (SDAX). C.A.T. oil offers a wide spectrum of services
to increase the lifecycle of an oil field or to make unexploited oil
fields accessible. The Company´s growth is driven by the following
factors: Existing oil fields need to be stimulated due to shrinking
oil and gas resources in order to optimize capacities.
Simultaneously, idle wells are reactivated or made accessible through
new methods in order to deploy wells to their maximum. Additionally,
C.A.T. oil will establish conventional drilling as third core service
which allows to activate completely unexploited oil and gas sources.

Since its foundation in 1991 in Celle, Germany, C.A.T. oil has built
up a leading hydraulic fracturing services business in Russia and
Kazakhstan. Following its IPO in 2006 the Company has invested more
than EUR 250 million in additional services and capacities: sidetrack
drilling has become the Company´s second core business. In November
2010, the Company introduced a comprehensive investment program with
a volume of EUR 150 million which will mainly be used to set up
conventional drilling as part of the Company´s service portfolio.
Furthermore, C.A.T. oil offers coiled tubing, well work-over,
cementing and seismic services. Due to the recent investments C.A.T.
oil´s fleets and rigs are state-of-the-art and therefore allow for
time-efficient and effective deployment. C.A.T. oil´s customer base
includes the leading Russian and Kazakh oil and gas producers amongst
them Gazprom, KazMunaiGaz, LUKOIL, Rosneft and TNK-BP. C.A.T. oil has
a long-standing relationship with these customers and has been a
reliable service provider since its market entrance in the early
nineties.

The Company has its headquarters in Vienna. As of 30 June 2011, the
Company employed an average of 2,362 people, most of which are based
in Russia and Ka-zakhstan.

Key financial figures for H1 2011

[in million EUR]

H1 2011 H1 2010 Change in %
Revenues 135.0 108.5 24.4
Cost of sales 116.0 89.2 30.1
Gross profit 19.0 19.3 -1.5
EBITDA 27.0 26.8 0.7
EBITDA margin (in%) 20.0 24.7
EBIT 10.0 12.4 -19.4
EBIT margin (in%) 7.4 11.4
Net income 6.9 8.5 -19.3
Earnings per share (in EUR) 0.140 0.174 -19.3
Equity Ratio (in %)(1) 72.8 83.2

Cash flow from operating
activities 16.1 33.5 -51.9
Cash flow from investing
activities -44.4 -12.4 >100
Cash flow from financing
activities 17.5 -3.8 >100
Cash and cash equivalents(1) 24.4 34.1 -28.5

Total job count 1,648 1,409 17.0
Per-job revenue
(in thou. EUR) 81.0 76.0 7.7
Employees 2,362 2,455 -3.8

(1) As of 30 June 2011 and 31 December 2010 respectively

Key financial figures for Q2 2011

[in million EUR]

Q2 2011 Q2 2010 Change in %
Revenues 74.0 61.3 20.6
Cost of sales 60.4 47.4 27.4
Gross profit 13.5 13.9 -2.5
EBITDA 18.4 17.8 3.3
EBITDA margin (in%) 24.8 29.0
EBIT 9.4 10.6 -11.0
EBIT margin (in%) 12.8 17.3
Net income 7.8 7.5 4.6
Earnings per share (in EUR) 0.160 0.153 4.6

Cash flow from operating
activities 15.8 33.9 -53.2
Cash flow from investing
activities -16.6 -9.6 78.5
Cash flow from financing
activities 11.5 -5.5 >100

Total job count 878 791 11.0
Per-job revenue
(in thou. EUR) 83.0 77.0 8.6

Further inquiry note:
Thomas Krammer
Tel: +49(0)69-92037-183
Email: thomas.krammer@fd.com

end of announcement euro adhoc
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company: C.A.T. oil AG
Kärtner Ring 11-13
A-A-1010 Wien
phone: +43(0) 1 535 23 20 - 0
FAX: +43(0) 1 535 23 20 - 20
mail: ir@catoilag.com
WWW: http://www.catoilag.com
sector: Oil & Gas - Upstream activities
ISIN: AT0000A00Y78
indexes: SDAX, Classic All Share, Prime All Share
stockmarkets: regulated dealing/prime standard: Frankfurt
language: English