(Summary) (Company) (Chart)
25 February 2018
1yr Target $2.60
Payout Ratio 0.00%
1yr Cap Gain 20.37%
1yr Tot Return 20.37%
EPS (ttm) $0.07
EPS next yr $0.11
Forward P/E 19.12
EPS next 5yr 21.00%
1yr Price Support $2.31
Market Cap $100.89 Mil
Revenues $34.40 Mil
Earnings $3.70 Mil
Profit Margin 10.75%
Quick Ratio 8.50
Current Ratio 11.20
1yr RevGR 44.60%
3yr RevGR 46.99%
5yr RevGR 53.98%
1yr EarnGR -8.34%
3yr EarnGR 16.08%
5yr EarnGR 29.67%
1yr DivGR ---
3yr DivGR ---
5yr DivGR ---
Profile Energy is an oilfield technology company, providing products that enhance the efficiency, safety, and compliance of the oil and gas industry. The Company specializes in the creation of burner-management systems used on a variety of oilfield natural-draft fire tube vessels. They sell their products and services primarily throughout North America. Their experienced team of industry service professionals also provides supporting services for these products. Profile Energy was originally incorporated on May 5, 2003 and since October 2008, they have been primarily engaged in the business of developing burner-management technologies for the oil and gas industry.
Principal Products and Services
In the oil and natural gas industry, there are numerous demands for heat generation and control. Oilfield vessels of all kinds, including line-heaters, dehydrators, separators, treaters, amine reboilers, and free-water knockout systems require heat to satisfy their various functions, which is provided by a burner flame inside the vessel. This burner flame is integral to the operation of the vessel because these vessels use the flame's heat to facilitate the proper function of the vessel. Such functions include separating, storing, transporting and purifying oil and gas (or even water). For example, the viscosity of oil and moisture content (and temperature) of gas are critical to a number of oilfield processes, and are directly affected by the heat provided by the burner flame inside the vessel. Profile Energy's burner-management systems help ignite, monitor, and manage this burner flame, reducing the need for employee interaction with the burner, such as for the purposes of re-ignition or temperature monitoring.
As a result, oil and gas producers can achieve increased safety, greater operational efficiencies, and improved compliance with industry regulations. The Company believes there is a growing trend in the oil and gas industry toward enhanced control, process automation, and data logging, partly for potential regulatory-satisfaction purposes. They also believe that enhanced burner-management products and services can help their customers be compliant with such regulatory requirements, where applicable. In addition to selling products, the Company trains and dispatches service technicians to service burner flame installations in Canada and throughout the United States.
Profire Energy initially developed their first burner-management system in 2005. Since 2005, they have released several iterations of the initial burner-management system, increasing features and capabilities, while maintaining compliance with Canadian Standards Association (CSA) and Underwriters Laboratories (UL) ratings.
The Company's burner-management systems have become widely used in Western Canada, and throughout many regions in the United States. They've sold their burner-management systems to many large energy companies, including Anadarko, Chesapeake Energy, ConocoPhillips, Devon Energy, Encana, Exxon-Mobil, Petro-Canada, Shell and others. Their systems have also been sold or installed in other parts of the world, including France, Italy, Ukraine, India, Nigeria, the Middle East, Australia, and Brazil. While they have an interest in expanding international distribution capabilities, their current principal focus is on the North American oil and gas market.
Recent Product Extension: PF3100
In September 2015, the Company unveiled its next generation burner-management system which is designed to operate, monitor, and control more complex, multi-faceted oilfield applications. The PF3100 is an advanced management system designed to work with a number of Profire-engineered modules, specific to different applications, thus allowing the system to expertly manage a wide variety of applications.
Throughout the industry, Programmable Logic Controllers (PLCs) are used to operate and manage custom-built oilfield applications. Though capable, PLCs can be expensive, tedious, and difficult to use. The Company's unique solution, the PF3100, can help manage and synchronize custom applications, helping oilfield producers meet deadlines and improve profitability through an off-the-shelf solution with dynamic customization. The Company is selling the PF3100 for initial use in the oil and gas industry's natural-draft market, and has begun engaging with customers regarding forced-air module application within the oil and gas industry.
Additional Complementary Products
In addition to the Company's burner-management systems, they also sell complementary oilfield products to help facilitate improved oilfield safety and efficiency. Such products help manage fuel flow (e.g., valves and fuel-trains), meter air flow (e.g., airplates), generate power on-site (e.g., solar packages), ignite and direct flame (e.g., flare stack igniter and nozzles), and other necessary functions. They continue to develop innovative complementary products, which they anticipate will help bolster continued long-term growth. Some of the complementary products they sell are purchased from third parties (e.g., solar packages), while some are proprietary (e.g., flare stack igniter) or patent-pending (e.g., inline pilot and valve technologies).
In addition to the burner-management systems and complementary technologies Profire Energy has historically sold, they extended their product line by acquiring the assets of VIM Injection Management ("VIM") in November 2014, which extended the product offering to include chemical-management systems.
Chemical injection is used for a wide variety of purposes in the oil and gas industry including down-hole inhibition of wax, hydrates, and corrosion agents, so that product can flow more efficiently to the wellhead. Once at the wellhead, chemical injection can also be used to further process the oil or gas before it is sent into a pipeline, and with other applications.
Currently, a variety of pumps are used to meter the chemicals injected, but are often inaccurate in injecting the proper amount of chemical, as they may not account for all of the variables that affect how much chemical should be injected (e.g., pressure, hydrogen sulfide concentration, etc.) nor the optimal efficiency rates of varying pump systems.
Inaccurate injection levels are problematic because the chemicals injected are expensive, and over-injection causes unnecessary expense for producers. Under-injection can also be problematic because it often results in the creation of poor product (i.e., with wax, hydrate, or corrosion agents) and causes problems with pipeline audits.
Profire Energy's chemical-management systems monitor and manage the chemical-injection process to ensure that optimal levels of chemicals are injected. This improves the efficiency of the pump and production quality of the well, improves safety for workers by reducing the risk of exposure to these chemicals, and improves compliance with pipeline regulations. Like their burner-management systems, the chemical-management systems can be monitored and managed remotely via SCADA or other remote-communication systems. Profire Energy holds a U.S. patent related to their chemical management system and its process for supplying a chemical agent to a process fluid. Other international patents are pending.
I started a position last week in these shares based on the fundamentals above and the company's stock chart. The shares are definitely moving higher as the company's fundamentals continue to improve. But this is a very small company with a specific market. And while they're currently trying to broaden their market by looking into the agriculture sector for additional future growth, there's no guarantee any of that will happen. But despite that, I believe this is a great company with a great product in an industry that's coming back strong.
I intend to monitor this company closely with the intent of accumulating additional shares as they move higher. I think this company has a great future and I'd like to be part of it.