Oil and natural gas commodity prices remained strong throughout the year, keeping demand strong. The strong industry fundamentals during 2005 allowed Ensign to complete several key acquisitions, grow and modernize its equipment fleet, and achieve improved operating margins for its services, states the company. The company also is proposing a two-for-one stock split for its upcoming shareholders meeting.
In comparison to 2004, equipment utilization and revenue rates for the year ended December 31, 2005, improved in all of the Ensign's operating segments. During 2005, the company completed acquisitions in Latin America and the US that, coupled with its ongoing capital expenditures program, served to increase Ensign's revenue base.
Revenue for the year ended December 31, 2005, topped $1.5 billion for the first time in the company's history, exceeding the prior year's record by 44 percent. Net income for 2005 totaled $169.7 million ($2.24 per common share), an increase of 43 percent over the previous year's net income of $118.8 million ($1.58 per common share). Ensign's 2005 financial results were adversely impacted by the expense associated with the its stock-based compensation plan, which increased 313 percent over 2004--mainly due to positive appreciation in the price of the Company's common shares. Eliminating the impact of stock-based compensation expense, the company's adjusted net income increased $97.8 million, or 73 percent, in 2005 from the prior year.
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