TOT Total Energy Services Inc

Total Energy Services Inc. (“Total Energy” or the “Company”) (TSX:TOT) announces its consolidated financial results for the three and six months ended June 30, 2022.

Financial Highlights
($000’s except per share data)
	Three months ended June 30						Six months ended June 30
	2022		2021		Change		2022		2021		Change
Revenue	$	179,204	$	84,876	111%		$	340,656	$	178,066	91%
Operating income (loss)		8,426		(4,089)	nm			12,116		(9,508)	nm
EBITDA(1)		28,799		19,716	46%			53,113		36,433	46%
Cashflow		28,576		16,462	74%			51,127		31,794	61%
Net income (loss)		6,105		(2,136)	nm			8,572		(5,743)	nm
Attributable to shareholders		6,113		(2,108)	nm			8,585		(5,687)	nm
Per Share Data (Diluted)
EBITDA(1)	$	0.67	$	0.44	52%		$	1.23	$	0.81	52%
Cashflow	$	0.66	$	0.37	78%		$	1.18	$	0.70	69%
Attributable to shareholders:
Net income (loss)	$	0.14	$	(0.05)	nm		$	0.20	$	(0.13)	nm
Common shares (000’s)(4)
Basic		42,307		44,830	(6%)			42,509		44,950	(5%)
Diluted		43,203		45,066	(4%)			43,319		45,158	(4%)
								June 30		December 31
Financial Position at								2022		2021	Change
Total Assets							$	860,983	$	813,522	6%
Long-Term Debt and Lease Liabilities (excluding current portion)								165,767		196,007	(15%)
Working Capital(2)								122,043		137,304	(11%)
Net Debt(3)								43,724		58,703	(26%)
Shareholders’ Equity								494,299		493,437	-
Notes 1 through 4 please refer to the Notes to the Financial Highlights set forth at the end of this release.
“nm” – calculation not meaningful

Total Energy’s results for the three months ended June 30, 2022 reflect the continued recovery of the global energy industry, particularly in North America. Prolonged wet weather conditions in Australia during the second quarter of 2022 restricted field activity and resulted in a substantial year over year increase in drilling and service rig paid standby days. The Company did not receive any COVID-19 relief funds during the quarter as compared to $8.1 million received in the second quarter of 2021.

Contract Drilling Services (“CDS”)
		Three months ended June 30								Six months ended June 30
	2022			2021			Change		2022			2021			Change
Revenue	$	49,440		$	25,740		92%		$	109,502		$	54,311		102%
EBITDA(1)	$	8,808		$	4,708		87%		$	20,249		$	10,976		84%
EBITDA(1)as a % of revenue		18%			18%		-			18%			20%		(10%)
Operating days(2)		2,105			1,235		70%			4,788			2,773		73%
Canada		1,009			563		79%			2,634			1,647		60%
United States		696			467		49%			1,397			768		82%
Australia		400			205		95%			757			358		111%
Revenue per operating day(2), dollars	$	23,487		$	20,842		13%		$	22,870		$	19,586		17%
Canada		21,304			15,625		36%			20,711			16,175		28%
United States		24,165			19,340		25%			22,998			19,046		21%
Australia		27,813			38,590		(28%)			30,145			36,433		(17%)
Utilization		24%			14%		71%			28%			16%		75%
Canada		14%			8%		75%			19%			11%		73%
United States		59%			39%		51%			59%			33%		79%
Australia		88%			45%		96%			84%			40%		110%
Rigs, average for period		95			97		(2%)			95			98		(3%)
Canada		77			79		(3%)			77			80		(4%)
United States		13			13		-			13			13		-
Australia		5			5		-			5			5		-
(1)   See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
(2)   Operating days includes drilling and paid stand-by days.

Second quarter 2022 drilling activity in North America continued to increase with relatively strong oil and natural gas prices. Continued recovery of Canadian industry activity levels from the historic lows of 2020 and market share gains in the United States drove a significant year over year increase in North American operating days and increased revenue per operating day.   In Australia, activity levels improved in the second quarter of 2022 compared to 2021 as two drilling rigs returned to service following the completion of recertifications and upgrades although a substantial year over year increase in lower rate paid stand-by days due to wet weather contributed to lower revenue per operating day but also lower operating costs. The second quarter EBITDA margin was consistent on a year over year basis with increased pricing offsetting the absence of COVID-19 relief funds and operating cost inflation.

Rentals and Transportation Services (“RTS”)
	Three months ended June 30								Six months ended June 30
	2022			2021			Change		2022			2021			Change
Revenue	$	13,441		$	6,053		122%		$	28,841		$	13,788		109%
EBITDA(1)	$	3,500		$	3,324		5%		$	9,093		$	5,290		72%
EBITDA(1)as a % of revenue		26%			55%		(53%)			32%			38%		(16%)
Revenue per utilized piece of equipment, dollars	$	10,219		$	7,111		44%		$	20,444		$	16,199		26%
Pieces of rental equipment		9,390			10,630		(12%)			9,390			10,630		(12%)
Canada		8,510			9,670		(12%)			8,510			9,670		(12%)
United States		880			960		(8%)			880			960		(8%)
Rental equipment utilization		14%			8%		75%			15%			8%		88%
Canada		13%			7%		86%			14%			8%		75%
United States		25%			12%		108%			28%			12%		133%
Heavy trucks		71			80		(11%)			71			80		(11%)
Canada		48			56		(14%)			48			56		(14%)
United States		23			24		(4%)			23			24		(4%)
(1) See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.

Second quarter revenue in the RTS segment increased as compared to the same period in 2021 due to higher equipment utilization and modestly improved pricing. Increased equipment utilization as well as higher revenue per utilized piece of equipment contributed to the year over year increase in second quarter EBITDA. Second quarter EBITDA margin was lower compared to the same period in 2021 due to the absence of COVID-19 relief assistance combined with significant operating cost inflation that was not fully recovered through price increases.

Compression and Process Services (“CPS”)
	Three months ended June 30								Six months ended June 30
	2022			2021			Change		2022			2021			Change
Revenue	$	92,782		$	33,657		176%		$	151,347		$	67,813		123%
EBITDA(1)	$	14,948		$	7,682		95%		$	18,206		$	11,257		62%
EBITDA(1)as a % of revenue		16%			23%		(30%)			12%			17%		(29%)
Horsepower of equipment on rent at period end		30,970			27,420		13%			30,970			27,420		13%
Canada		13,975			11,840		18%			13,975			11,840		18%
United States		16,995			15,580		9%			16,995			15,580		9%
Rental equipment utilization during the period (HP)(2)		54%			47%		15%			53%			45%		18%
Canada		39%			31%		26%			38%			31%		23%
United States		75%			74%		1%			74%			67%		10%
Sales backlog at period end, $ million	$	181.7		$	57.5		216%		$	181.7		$	57.5		216%
(1) See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
(2) Rental equipment utilization is measured on a horsepower basis.

The year over year increase in the CPS segment’s second quarter revenue was due primarily to higher fabrication sales, increased equipment overhaul activity and $7.4 million of contract cancellation revenue. Compression rental fleet utilization continued to recover during the second quarter of 2022. The absence of COVID-19 relief assistance and general operating cost inflation contributed to a lower second quarter EBITDA margin in 2022 as compared to 2021. Improved pricing following the completion during the first quarter of 2022 of lower margin fabrication orders received in 2021 contributed to a substantial sequential quarterly improvement in segment margins.   The fabrication sales backlog continued to grow during the second quarter of 2022, increasing by $34.2 million, or 23%, compared to the $147.5 million backlog at December 31, 2021 and $1.0 million from the $180.7 million backlog at March 31, 2022 after deducting the cancelled contracts.   

Well Servicing (“WS”)
		Three months ended June 30								Six months ended June 30
	2022			2021			Change		2022			2021			Change
Revenue	$	23,541		$	19,426		21%		$	50,966		$	42,154		21%
EBITDA(1)	$	3,729		$	4,667		(20%)		$	10,277		$	9,819		5%
EBITDA(1)as a % of revenue		16%			24%		(33%)			20%			23%		(13%)
Service hours(2)		26,007			22,201		17%			56,846			51,134		11%
Canada		10,707			8,303		29%			27,157			25,425		7%
United States		4,556			3,449		32%			8,710			6,060		44%
Australia		10,744			10,449		3%			20,979			19,649		7%
Revenue per service hour(2), dollars	$	905		$	875		3%		$	897		$	824		9%
Canada		925			686		35%			866			659		31%
United States		892			664		34%			856			674		27%
Australia		891			1,095		(19%)			953			1,084		(12%)
Utilization(3)		27%			21%		29%			31%			27%		15%
Canada		21%			16%		31%			26%			25%		4%
United States		46%			27%		70%			44%			24%		83%
Australia		41%			40%		3%			40%			38%		5%
Rigs, average for period		80			83		(4%)			80			83		(4%)
Canada		57			57		-			57			57		-
United States		11			14		(21%)			11			14		(21%)
Australia		12			12		-			12			12		-
(1) See Note 1 of the Notes to the Financial Highlights set forth at the end of this release.
(2) Service hours is defined as well servicing hours of service provided to customers and includes paid rig move and standby.
(3) The Company reports its service rig utilization for its operational service rigs in North America based on service hours of 3,650 per rig per year to reflect standard 10 hour operations per day. Utilization for the Company’s service rigs in Australia is calculated based on service hours of 8,760 per rig per year to reflect standard 24 hour operations.

Second quarter WS segment revenue increased in 2022 as compared to 2021 due primarily to improved North American activity, higher pricing and the mix of equipment operating. EBITDA for the second quarter of 2022 was lower compared to the same period last year primarily due to Australia where field activity was limited due to prolonged wet weather conditions that resulted in a substantial year over year increase in lower rate paid stand-by. Also impacting the WS segment’s EBITDA and EBITDA margin for the second quarter of 2022 compared to 2021 was the absence of COVID-19 relief funds and significant operating cost inflation.

Corporate

During the second quarter of 2022, Total Energy remained focused on the safe and efficient operation of its business and improving the overall financial performance of the Company in a challenging cost environment. The $13.2 million of second quarter cash flow remaining after funding net capital expenditures and lease and interest payments was directed towards $10.7 million of debt reduction and $2.4 million of share repurchases under the Company’s normal course issuer bid.

For the six months ended June 30, 2022, after changes in non-cash working capital items and funding $21.1 million of net capital expenditures, $3.4 million of interest payments and $2.3 million of lease payments, Total Energy has generated $43.2 million of free cash flow. This free cash flow has been allocated as to $31.3 million of debt repayment, $5.9 million of share repurchases and payment of a $0.06 per share quarterly dividend to shareholders of record on June 30, 2022 that was paid on July 15, 2022.

Total Energy exited the second quarter of 2022 with $122.0 million of positive working capital, including $42.3 million of cash, and $115 million of available credit under its $225 million of revolving bank credit facilities.   The weighted average interest rate on the Company’s outstanding debt at June 30, 2022 was 3.39%.

Outlook

Total Energy’s consolidated financial results for the second quarter exceeded first quarter results, which is an exceptional occurrence given the seasonality of Canadian operations. Despite market and commodity price volatility, energy service industry fundamentals continue to improve. Total Energy’s active drilling rig count in Canada currently exceeds the peak rig count reached during the first quarter of 2022 and provides optimism for activity levels for the remainder of 2022. Industry equipment and personnel constraints have begun to appear, which has supported continued pricing recovery in all business segments.

In response to increasing activity levels and longer lead times for certain equipment, Total Energy has increased its 2022 capital expenditure budget to $56.2 million. Included in this $14.1 million increase is $10.0 million for new equipment and equipment upgrades in the CDS, RTS and WS segments and $4.1 million of light duty vehicles for use in all business segments. The Company intends to finance its 2022 capital expenditure budget with cash on hand and, in respect of the light duty vehicles, $4.1 million of capital leases.

After funding its capital expenditure commitments, Total Energy expects to generate significant free cash flow for the remainder of 2022. Given current market conditions, debt repayment and share buybacks remain attractive opportunities for deployment of such free cash flow. The Company also continues to evaluate consolidation opportunities within its existing business segments.

Conference Call

At 9:00 a.m. (Mountain Time) on August 9, 2022 Total Energy will conduct a conference call and webcast to discuss its second quarter financial results. Daniel Halyk, President & Chief Executive Officer, will host the conference call. A live webcast of the conference call will be accessible on Total Energy’s website at www.totalenergy.ca by selecting “Webcasts”. Persons wishing to participate in the conference call may do so by calling (800) 319-4610 or (416) 915-3239. Those who are unable to listen to the call live may listen to a recording of it on Total Energy’s website. A recording of the conference call will also be available until September 9, 2022 by dialing (855) 669-9658 (passcode 9194).

Selected Financial Information

Selected financial information relating to the three and six months ended June 30, 2022 and 2021 is included in this news release. This information should be read in conjunction with the condensed interim consolidated financial statements of Total Energy and the notes thereto as well as management’s discussion and analysis to be issued in due course and in the Company’s 2021 Annual report.

Consolidated Statements of Financial Position
(in thousands of Canadian dollars)
			June 30				December 31
			2022				2021
			(unaudited)				(audited)
Assets
Current assets:
Cash and cash equivalents			$	42,345			$	33,365
Accounts receivable				130,820				90,543
Inventory				93,513				89,921
Prepaid expenses and deposits				15,457				9,208
Income taxes receivable				2,570				2,208
Current portion of lease asset				511				487
				285,216				225,732
Property, plant and equipment				564,540				575,913
Income taxes receivable				7,070				7,070
Deferred income tax asset				-				393
Lease asset				104				361
Goodwill				4,053				4,053
			$	860,983			$	813,522
Liabilities & Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities			$	96,923			$	65,513
Deferred revenue				56,073				16,274
Dividends payable				2,532				-
Current portion of lease liabilities				5,004				4,030
Current portion of long-term debt				2,641				2,611
				163,173				88,428
Long-term debt				156,572				187,906
Lease liabilities				9,195				8,101
Deferred tax liability				37,744				35,650
Shareholders' equity:
Share capital				265,769				270,905
Contributed surplus				3,434				5,757
Accumulated other comprehensive loss				(26,493)				(26,704)
Non-controlling interest				548				561
Retained earnings				251,041				242,918
				494,299				493,437
			$	860,983			$	813,522

Consolidated Statements of Comprehensive Income (Loss)
Unaudited (in thousands of Canadian dollars except per share amounts)
		Three months endedJune 30						Six months endedJune 30
		2022			2021			2022			2021
Revenue		$	179,204		$	84,876		$	340,656		$	178,066
Cost of services			140,917			63,092			270,715			134,180
Selling, general and administration			10,108			6,069			18,894			12,608
Other income			(485)			(1,114)			(675)			(2,180)
Share-based compensation			259			189			479			390
Depreciation			19,979			20,729			39,127			42,576
Operating income (loss)			8,426			(4,089)			12,116			(9,508)
Gain on sale of property, plant and equipment			394			3,076			1,870			3,365
Finance costs, net			(1,563)			(1,772)			(3,369)			(3,579)
Net income (loss) before income taxes			7,257			(2,785)			10,617			(9,722)
Current income tax expense (recovery)			21			16			(442)			(455)
Deferred income tax expense (recovery)			1,131			(665)			2,487			(3,524)
Total income tax expense (recovery)			1,152			(649)			2,045			(3,979)
Net income (loss)		$	6,105		$	(2,136)		$	8,572		$	(5,743)
Net income (loss) attributable to:
Shareholders of the Company		$	6,113		$	(2,108)		$	8,585		$	(5,687)
Non-controlling interest			(8)			(28)			(13)			(56)
Income (loss) per share
Basic and diluted		$	0.14		$	(0.05)		$	0.20		$	(0.13)

Consolidated Statements of Comprehensive Income (Loss)
		Three months endedJune 30						Six months endedJune 30
		2022			2021			2022			2021
Net income (loss) for the period		$	6,105		$	(2,136)		$	8,572		$	(5,743)
Foreign currency translation			114			(5,820)			211			(11,122)
Total other comprehensive income (loss) for the period			114			(5,820)			211			(11,122)
Total comprehensive income (loss)		$	6,219		$	(7,956)		$	8,783		$	(16,865)
Total comprehensive income (loss) attributable to:
Shareholders of the Company		$	6,227		$	(7,928)		$	8,796		$	(16,809)
Non-controlling interest			(8)			(28)			(13)			(56)

Consolidated Statements of Cash Flows
Unaudited (in thousands of Canadian dollars)
		Three months endedJune 30						Six months endedJune 30
		2022			2021			2022			2021
Cash provided by (used in):
Operations:
Net income (loss) for the period		$	6,105		$	(2,136)		$	8,572		$	(5,743)
Add (deduct) items not affecting cash:
Depreciation			19,979			20,729			39,127			42,576
Share-based compensation			259			189			479			390
Gain on sale of property, plant and equipment			(394)			(3,076)			(1,870)			(3,365)
Finance costs, net			1,563			1,772			3,369			3,579
Unrealized gain on foreign currencies translation			(485)			(1,114)			(675)			(2,180)
Current income tax expense (recovery)			21			16			(442)			(455)
Deferred income tax expense (recovery)			1,131			(665)			2,487			(3,524)
Income taxes paid			397			747			80			516
Cashflow			28,576			16,462			51,127			31,794
Changes in non-cash working capital items:
Accounts receivable			(15,130)			3,738			(39,978)			(159)
Inventory			2,937			972			(3,590)			2,129
Prepaid expenses and deposits			(6,307)			1,068			(6,249)			2,041
Accounts payable and accrued liabilities			12,170			7,123			28,839			7,991
Deferred revenue			2,747			2,259			39,799			4,692
Cash provided by operating activities			24,993			31,622			69,948			48,488
Investing:
Purchase of property, plant and equipment			(13,406)			(8,079)			(24,959)			(13,153)
Proceeds on disposal of property, plant and equipment			838			8,005			3,877			8,445
Changes in non-cash working capital items			1,608			79			2,951			1,051
Cash (used in) provided by investing activities			(10,960)			5			(18,131)			(3,657)
Financing:
Repayment of long-term debt			(10,651)			(18,637)			(31,304)			(29,275)
Repayment of lease liabilities			(1,219)			(1,802)			(2,281)			(3,622)
Repurchase of common shares			(2,371)			(1,924)			(5,899)			(2,253)
Shares issued on exercise of share options			31			-			31			-
Interest paid			(1,639)			(738)			(3,384)			(3,446)
Cash used in financing activities			(15,849)			(23,101)			(42,837)			(38,596)
Change in cash and cash equivalents			(1,816)			8,526			8,980			6,235
Cash and cash equivalents, beginning of period			44,161			20,705			33,365			22,996
Cash and cash equivalents, end of period		$	42,345		$	29,231		$	42,345		$	29,231

Segmented Information

The Company provides a variety of products and services to the energy and other resource industries through five reporting segments, which operate substantially in three geographic regions. These reporting segments are Contract Drilling Services, which includes the contracting of drilling equipment and the provision of labour required to operate the equipment, Rentals and Transportation Services, which includes the rental and transportation of equipment used in energy and other industrial operations, Compression and Process Services, which includes the fabrication, sale, rental and servicing of gas compression and process equipment and Well Servicing, which includes the contracting of service rigs and the provision of labour required to operate the equipment. Corporate includes activities related to the Company’s corporate and public issuer affairs.

As at and for the three months ended June 30, 2022 (unaudited, in thousands of Canadian dollars)
	Contract			Rentals and			Compression			Well			Corporate(1)			Total
	Drilling			Transportation			and Process			Servicing
	Services			Services			Services
Revenue	$	49,440		$	13,441		$	92,782		$	23,541		$	-		$	179,204
Cost of services		39,171			8,213			74,989			18,544			-			140,917
Selling, general and administration		1,754			1,702			2,930			1,310			2,412			10,108
Other income		-			-			-			-			(485)			(485)
Share-based compensation		-			-			-			-			259			259
Depreciation		8,882			4,886			2,779			3,218			214			19,979
Operating income (loss)		(367)			(1,360)			12,084			469			(2,400)			8,426
Gain (loss) on sale of property, plant and equipment		293			(26)			85			42			-			394
Finance costs, net		(4)			(23)			(102)			(4)			(1,430)			(1,563)
Net income (loss) before income taxes		(78)			(1,409)			12,067			507			(3,830)			7,257
Goodwill		-			2,514			1,539			-			-			4,053
Total assets		339,585			181,049			247,172			87,703			5,474			860,983
Total liabilities		71,626			13,936			103,052			6,756			171,314			366,684
Capital expenditures		7,282			2,524			1,691			1,909			-			13,406

Three months ended June 30, 2022	Canada		United States		Australia		Other		Total
Revenue	$	96,074	$	45,714	$	37,416	$	-	$	179,204
Non-current assets(2)		374,963		140,254		53,480		-		568,697

As at and for the three months ended June 30, 2021 (unaudited, in thousands of Canadian dollars)
	Contract			Rentals and			Compression			Well			Corporate			Total
	Drilling			Transportation			and Process			Servicing			(1)
	Services			Services			Services
Revenue	$	25,740		$	6,053		$	33,657		$	19,426		$	-		$	84,876
Cost of services		20,355			3,029			25,932			13,776			-			63,092
Selling, general and administration		949			1,276			1,180			1,061			1,603			6,069
Other income		-			-			-			-			(1,114)			(1,114)
Share-based compensation		-			-			-			-			189			189
Depreciation		9,461			5,042			2,265			3,749			212			20,729
Operating income (loss)		(5,025)			(3,294)			4,280			840			(890)			(4,089)
Gain on sale of property, plant and equipment		272			1,576			1,137			78			13			3,076
Finance costs, net		(8)			(30)			(74)			(5)			(1,655)			(1,772)
Net income (loss) before income taxes		(4,761)			(1,748)			5,343			913			(2,532)			(2,785)
Goodwill		-			2,514			1,539			-			-			4,053
Total assets		313,553			186,423			212,647			95,469			3,523			811,615
Total liabilities		55,394			8,253			38,462			4,887			212,360			319,356
Capital expenditures		5,482			61			2,413			123			-			8,079

Three months ended June 30, 2021	Canada		United States		Australia		Other		Total
Revenue	$	42,548	$	22,894	$	19,434	$	-	$	84,876
Non-current assets(2)		395,471		142,563		64,416		-		602,450
(1)   Corporate includes the Company’s corporate activities and obligations pursuant to long-term credit facilities.
(2)   Includes property, plant and equipment, lease asset (excluding current portion) and goodwill.

As at and for the six months ended June 30, 2022 (unaudited, in thousands of Canadian dollars)
	Contract			Rentals and			Compression			Well			Corporate (1)			Total
	Drilling			Transportation			and Process			Servicing
	Services			Services			Services
Revenue	$	109,502		$	28,841		$	151,347		$	50,966		$	-		$	340,656
Cost of services		86,165			17,060			129,322			38,168			-			270,715
Selling, general and administration		3,356			3,328			4,724			2,578			4,908			18,894
Other income		-			-			-			-			(675)			(675)
Share-based compensation		-			-			-			-			479			479
Depreciation		17,759			9,795			4,692			6,420			461			39,127
Operating income (loss)		2,222			(1,342)			12,609			3,800			(5,173)			12,116
Gain on sale of property, plant and equipment		268			640			905			57			-			1,870
Finance costs, net		(6)			(39)			(174)			(9)			(3,141)			(3,369)
Net income (loss) before income taxes		2,484			(741)			13,340			3,848			(8,314)			10,617
Goodwill		-			2,514			1,539			-			-			4,053
Total assets		339,585			181,049			247,172			87,703			5,474			860,983
Total liabilities		71,626			13,936			103,052			6,756			171,314			366,684
Capital expenditures		17,464			2,758			2,761			1,965			11			24,959

Six months ended June 30, 2022	Canada		United States		Australia		Other		Total
Revenue	$	184,267	$	89,358	$	67,031	$	-	$	340,656
Non-current assets(2)		374,963		140,254		53,480		-		568,697

As at and for the six months ended June 30, 2021 (unaudited, in thousands of Canadian dollars)
	Contract			Rentals and			Compression			Well			Corporate			Total
	Drilling			Transportation			and Process			Servicing			(1)
	Services			Services			Services
Revenue	$	54,311		$	13,788		$	67,813		$	42,154		$	-		$	178,066
Cost of services		41,270			7,701			55,156			30,053			-			134,180
Selling, general and administration		2,345			2,528			2,624			2,329			2,782			12,608
Other income		-			-			-			-			(2,180)			(2,180)
Share-based compensation		-			-			-			-			390			390
Depreciation		19,326			10,560			4,672			7,601			417			42,576
Operating income (loss)		(8,630)			(7,001)			5,361			2,171			(1,409)			(9,508)
Gain on sale of property, plant and equipment		280			1,731			1,224			47			83			3,365
Finance costs, net		(9)			(46)			(152)			(11)			(3,361)			(3,579)
Net income (loss) before income taxes		(8,359)			(5,316)			6,433			2,207			(4,687)			(9,722)
Goodwill		-			2,514			1,539			-			-			4,053
Total assets		313,553			186,423			212,647			95,469			3,523			811,615
Total liabilities		55,394			8,253			38,462			4,887			212,360			319,356
Capital expenditures		9,739			280			2,581			553			-			13,153

Six months ended June 30, 2021	Canada		United States		Australia		Other		Total
Revenue	$	102,293	$	41,203	$	34,568	$	2	$	178,066
Non-current assets(2)		395,471		142,563		64,416		-		602,450
(1)   Corporate includes the Company’s corporate activities and obligations pursuant to long-term credit facilities.
(2)   Includes property, plant and equipment, lease asset (excluding current portion) and goodwill.

Total Energy provides contract drilling services, equipment rentals and transportation services, well servicing and compression and process equipment and service to the energy and other resource industries from operation centers in North America and Australia. The common shares of Total Energy are listed and trade on the TSX under the symbol TOT.

For further information, please contact Daniel Halyk, President & Chief Executive Officer at (403) 216-3921 or Yuliya Gorbach, Vice-President Finance and Chief Financial Officer at (403) 216-3920 or by e-mail at: investorrelations@totalenergy.ca or visit our website at www.totalenergy.ca

Notes to the Financial Highlights

(1) EBITDA means earnings before interest, taxes, depreciation and amortization and is equal to net income (loss) before income taxes plus finance costs plus depreciation. EBITDA is not a recognized measure under IFRS. Management believes that in addition to net income (loss), EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company’s primary business activities prior to consideration of how those activities are financed, amortized or how the results are taxed in various jurisdictions as well as the cash generated by the Company’s primary business activities without consideration of the timing of the monetization of non-cash working capital items. Readers should be cautioned, however, that EBITDA should not be construed as an alternative to net income determined in accordance with IFRS as an indicator of Total Energy’s performance. Total Energy’s method of calculating EBITDA may differ from other organizations and, accordingly, EBITDA may not be comparable to measures used by other organizations.(2) Working capital equals current assets minus current liabilities.(3) Net Debt equals long-term debt plus lease liabilities plus current liabilities minus current assets. Management believes this measure provides a useful indication of the Company’s liquidity.(4) Basic and diluted shares outstanding reflect the weighted average number of common shares outstanding for the periods. See note 5 to the Company’s Condensed Interim Consolidated Financial Statements.Certain statements contained in this press release, including statements which may contain words such as "could", "should", "expect", "believe", "will" and similar expressions and statements relating to matters that are not historical facts are forward-looking statements. Forward-looking statements are based upon the opinions and expectations of management of Total Energy as at the effective date of such statements and, in some cases, information supplied by third parties. Although Total Energy believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions and that information received from third parties is reliable, it can give no assurance that those expectations will prove to have been correct.

In particular, this press release contains forward-looking statements concerning industry activity levels, including expectations regarding Total Energy’s future activity levels, market share and compression and process production activity. Such forward-looking statements are based on a number of assumptions and factors including fluctuations in the market for oil and natural gas and related products and services, political and economic conditions, central bank interest rate policy, the demand for products and services provided by Total Energy, Total Energy’s ability to attract and retain key personnel and other factors. Such forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Total Energy to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Reference should be made to Total Energy’s most recently filed Annual Information Form and other public disclosures (available at www.sedar.com) for a discussion of such risks and uncertainties.

The TSX has neither approved nor disapproved of the information contained herein.