Strad Energy Services Ltd. reported unaudited consolidated earnings results for the second quarter and six months ended June 30, 2018. Strad reported a decrease in revenue and EBITDA of 2% and 17%, respectively during the three months ended June 30, 2018, compared to the same period in 2017. During the three months ended June 30, 2018, Strad reported net income of CAD 3.9 million compared to a net loss of CAD 2.2 million, due to certain tax transactions in the U.S. that resulted in the recognition of a deferred tax recovery of CAD 4.3 million. Strad's second quarter results were impacted by decreased drilling activity in Strad's Canadian operating regions. For the quarter, revenue was CAD 28,035,000, EBITDA was CAD 4,830,000 and capital expenditures were CAD 6,290,000 against revenue of CAD 28,494,000, EBITDA of CAD 5,799,000 and capital expenditures of CAD 6,264,000 a year ago. The decrease in EBITDA is driven primarily by the decrease in revenue during the second quarter of 2018. Loss before income tax was CAD 567,000 against CAD 2,265,000 a year ago. Diluted net income per share was CAD 0.06 against loss of CAD 0.08 a year ago. Cash flow from operating activities was CAD 9,644,000 or CAD 0.17 per diluted share against CAD 3,031,000 or CAD 0.05 per diluted share a year ago. Funds from operations was CAD 7,109,000 or CAD 0.12 per diluted share against CAD 6,076,000 or CAD 0.10 per diluted share a year ago. EBITDA per diluted share was CAD 0.08 against CAD 0.10 a year ago.

For the six months, revenue was CAD 56,399,000, EBITDA was CAD 10,093,000 and capital expenditures were CAD 11,045,000 against revenue of CAD 56,154,000, EBITDA of CAD 10,459,000 and capital expenditures of CAD 9,734,000 a year ago. Net income was CAD 3,464,000 or CAD 0.06 per diluted share against loss of CAD 4,512,000 or CAD 0.08 per diluted share a year ago. Decreased revenue during the quarter was primarily a result of lower rig counts, which decreased by 9% year- over-year. This led to decreased operating activity in the Western Canadian Sedimentary Basin and lower utilization rates for both matting and surface equipment, as compared to the same period in 2017. This was offset by improved customer pricing for both matting and surface equipment by 62% and 17% during the period, as compared to the same period in 2017. The decrease in EBITDA is driven primarily by the decrease in revenue during the first half of 2018. The decrease in net income is driven primarily by the decrease in revenue during the first half of 2018. Loss before income tax was CAD 926,000 against CAD 4,498,000 a year ago. Cash flow from operating activities was CAD 16,123,000 or CAD 0.27 per diluted share against CAD 6,572,000 or CAD 0.11 per diluted share a year ago. Funds from operations was CAD 13,580,000 or CAD 0.23 per diluted share against CAD 11,603,000 or CAD 0.20 per diluted share a year ago. EBITDA per diluted share was CAD 0.17 against CAD 0.18 a year ago.

The company has increased the 2018 capital budget from CAD 8 million to CAD 13 million to meet the expected demand for matting in Canada and the U.S. during the remainder of the year.