AKITA Drilling Ltd. Announces 2012 Third Quarter Earnings and Funds Flow

CALGARY, Oct. 28, 2011 /CNW/ - Commencing with the first quarterly report earlier this year, all financial information is reported for the Company in accordance with IFRS including for comparative periods except where noted.

AKITA Drilling Ltd.'s net income for the three months ended September 30, 2011 was $6,926,000 ($0.38 per share) on revenue of $54,874,000 compared to $2,215,000 ($0.12 per share) on revenue of $34,042,000 for the corresponding period in 2010.  Funds flow from operations for the quarter ended September 30, 2011 was $12,825,000 compared to $8,476,000 in the corresponding quarter in 2010.

Net income for the nine months ended September 30, 2011 was $16,375,000 ($0.90 per share) on revenue of $143,969,000.  Comparative figures for 2010 were net income of $2,614,000 ($0.14 per share) on revenue of $103,295,000.  Funds flow from operations for the January to September period in 2011 was $29,776,000 which included a one-time tax charge of $2,432,000, related to the second quarter repatriation of the Company's rigs from Alaska into Canada.  Funds flow from operations for the January to September comparative period was $21,240,000.

Rig activity increased significantly during the summer after a long and, in many cases, late break-up with third quarter utilization rates matching their highest level in over a decade for a third quarter.  Operating statistics for the first nine months of 2011 and 2010 are as follows:

		Number of Drilling Rigs		Operating Days
		Gross	Net	Third Quarter	Year to Date
Canadian Operations	2011	37	34.075	2,140	5,142
	2010	37	34.225	1,387	3,938
U.S. Operations	2011	0	0.0	0	0
	2010	2	1.0	0	23
Total	2011	37	34.075	2,140	5,142
	2010	39	35.225	1,387	3,961

AKITA's capital program is on track to be the largest since 2001.  The Company continues to execute its strategy to increase market penetration in self-moving pad rigs.  Thus far in 2011, AKITA has converted two rigs from conventional into pad configurations and has built one new pad rig.  The Company also has two further rigs that are undergoing conversion into pad rigs for this winter.  Once these additional two projects are complete, AKITA will have 15 pad rigs in its fleet.

The future outlook beyond the traditional strong winter drilling season includes significant uncertainty following break-up that will depend on, among other things, the price of crude oil, the ability for AKITA's customers to access financing and overall confidence levels in the economy.  AKITA is well positioned with financial and other resources to adapt to market conditions as they present themselves.

We are pleased to announce that Mr. Harish Mohan joined our Board of Directors on August 1, 2011.  Mr. Mohan brings a strong oil and gas drilling background and has held senior financial and management positions with a diversified, Canadian based, international group of companies.

Selected information from AKITA's Management's Discussion and Analysis for the Quarterly Report is as follows:

Revenue and Operating and Maintenance Expenses

$ Million	Three Months Ended September 30					Nine Months Ended September 30
	2011	2010	Change	%Change		2011	2010	Change	%Change
Revenue	54.9	34.0	20.9	61%		144.0	103.3	40.7	39%
Operating & Maintenance Expenses	35.8	21.6	14.2	66%		94.0	70.9	23.1	33%

$ Dollars	Three Months Ended September 30					Nine Months Ended September 30
	2011	2010	Change	%Change		2011	2010	Change	%Change
Revenue per operating day	25,642	24,544	1,098	4%		27,999	26,078	1,921	7%
Operating & Maintenance Expenses per operating day	16,736	15,590	1,146	7%		18,284	17,896	388	2%
Operating margin(1) per operating day	8,907	8,953	(46)	(1%)		9,715	8,182	1,533	19%

(1)     Note: Operating margin is the difference between revenue and operating & maintenance expenses

The changeover from GAAP to IFRS did not affect the Company's recognition of revenue per se.  It did, however, affect the balances reported for operating and maintenance expenses.  Certain expenditures that were previously recorded as maintenance expenses under GAAP are now recorded as property, plant and equipment under IFRS.  This reduced the balance otherwise reported as operating and maintenance expenses under IFRS.

Upon adoption of IFRS, revenue for goods and services provided by the Company to its customers on a cost recovery basis is presented in the Company's income statement on a gross basis.  These amounts were reported on a net basis under Canadian GAAP.  This change has resulted in offsetting increases to Revenue, Operating and Maintenance and Selling and Administrative expenses.

As a result of stronger market conditions, during the third quarter of 2011, overall revenue increased to $54,874,000 compared to $34,042,000 during the corresponding period in 2010.  On a "per operating day" basis, third quarter revenue increased to $25,642 in 2011 compared to $24,544 per day in 2010.  Much of the increase in revenue for the quarter was due to increased activity levels for AKITA's conventional rigs.  Additionally, AKITA has continued to expand the pad rig component of its fleet, and the demand for these rigs has continued to be strong.  As most of AKITA's pad rigs are working under longer duration contract, rates associated with those rigs were largely unchanged.

Operating and maintenance costs are tied to activity levels and amounted to $35,814,000 or $16,736 per operating day during the third quarter of 2011, compared to $21,624,000 or $15,590 per operating day for 2010.  The overall balance recorded in operating and maintenance expense increased both as a result of increased activity levels and increased daily costs.  "Per day" operating and maintenance costs rose based upon the overall mix of rigs that worked as well as general oilfield inflation, especially as it relates to the cost of drilling services as opposed to drilling supplies.  Further, during the comparative period, three of AKITA's rigs were earning revenue on a standby basis and therefore had no associated operating and maintenance costs.  During the current year, these rigs were all in active operation.

The Company's "per-day" operating margin for the third quarter of 2011 was $8,907 compared to a "per-day" operating margin of $8,953 during the corresponding quarter in 2010.  AKITA's conventional rigs were busier in the third quarter of 2011 compared to the corresponding quarter in 2010.  Typically, these rigs garner lower margins than the pad rigs, and were a significant factor in the quarterly margin reduction experience in the current quarter.

Overall revenue increased to $143,969,000 during the first nine months of 2011 from $103,295,000 during the first nine months of 2010 due to the stronger market conditions.  The influence of pad rigs was greater in the year-to-date results compared to the third quarter results, since this type of drilling was affected less by seasonality factors. This improvement in revenue reverses the previous four year trend of consecutive "year-over-year" declines in revenue experienced in the January to September periods.

In addition to an increase in total revenue for the nine months ended September 30, revenue per operating day increased to $27,999 during the first nine months of 2011 from $26,078 in the corresponding period of 2010.  As with the increase in overall revenue, revenue per day increased predominantly due to strength in the conventional drilling market.  Improvements in day rates for pad rigs were a secondary factor.

Operating and maintenance costs amounted to $94,017,000 or $18,284 per operating day during the first nine months of 2011 compared to $70,886,000 or $17,896 per operating day in the corresponding period of the prior year.  Although the daily cost of operating all rigs rose during the first nine months of 2011 compared to the corresponding period in 2010, this increase was offset to a large extent by having a higher percentage of conventional rigs operating in the current year-to-date period, as conventional rigs generally require smaller crew complements than are used in either deep or pad drilling applications.

On a nine month basis, the Company's "per-day" operating margin was $9,715 during 2011, compared to a "per-day" operating margin of $8,192 during the corresponding period in 2010.  The daily cost of operating all rigs rose during the third quarter of 2011 compared to the corresponding period in 2010 but was more than offset by higher revenue rates due to improved market conditions.

From time to time, the Company requires customers to make pre-payments prior to the provision of drilling services.  At September 30, 2011, these prepayments totalled $815,000 (September 30, 2010 - $985,000).

Depreciation Expense

$ Million	Three Months Ended September 30					Nine Months Ended September 30
	2011	2010	Change	% Change		2011	2010	Change	% Change
Depreciation Expense	5.6	6.0	(0.4)	(7%)		15.6	18.9	(3.3)	(17%)

The changeover from GAAP to IFRS affected the balances reported and methods used in determining depreciation expense.  Certain expenditures that were previously recorded as maintenance expenses under GAAP are now recorded as property, plant and equipment under IFRS.  This had the impact of increasing the balance otherwise reported as depreciation expense under IFRS.  Depreciation is also measured on a more detailed component-by-component basis under IFRS rather than using an asset-by-asset basis used under GAAP.  This change in approach has resulted in some differences that, depending on the actual assets being depreciated, had the effect of either increasing or decreasing the actual depreciation balance reported.  In general, the more detailed component-by-component depreciation approach is not considered to produce changes that are material in amount especially when considered over extended periods.

During 2011, the Company analyzed historical use patterns for its fleet and consequently changed its estimate of the useful lives of its rigs.  Previously, most of the Company's rig components were depreciated over an average of 2,000 operating days per rig, while selected rigs had components that were being depreciated over an average of 3,600 operating days.  Effective January 1, 2011, the Company began depreciating all of its rigs over an average useful life of 3,600 operating days per rig.

Concurrent with the change in estimate for useful lives of rigs, the Company reassessed and changed its estimates for salvage values for its rigs.  Previously, salvage values were set between $50,000 and $300,000 per rig.  Effective January 1, 2011, the Company is applying salvage values equal to 20% of the original cost of each rig.

The major factors that have had an impact on 2011 and 2010 depreciation are as follows: the one-time change to useful lives of rigs and related salvage values described previously (impact was to reduce depreciation recorded in the first nine months of 2011 by $3,255,000 including $383,000 in the third quarter; 2010 - no impact), ongoing rig activity levels, ongoing changes in rig mix actually working, and the recording of certain expenditures as assets under IFRS, necessitating depreciation for costs recorded as expense under previous GAAP.  This final change resulted in an increased depreciation expense of $3,417,000 for the nine months ended September 30, 2011 (nine months ended September 30, 2010 - $2,747,000) including $1,044,000 for the third quarter of 2011 (third quarter of 2010 - $1,015,000).  Since depreciation is based upon usage, it is impracticable to determine the impact of these changes in estimates for future periods until they occur.

The decrease in depreciation expense to $5,647,000 during the three months ended September 30, 2011 from $6,030,000 in the corresponding period in 2010 was mostly attributable to the change in estimated useful lives for the rig fleet.  Higher rig activity and a mix of rigs working having a higher average cost base offset much of the impact of the above noted change in estimated useful lives for the rig fleet in the third quarter of 2011 compared to the corresponding period in the comparative period.  In the three months ended September 30, 2011, drilling rig depreciation accounted for 96% of total depreciation expense (three months ended September 30, 2010 - 96%).

A comparison of year-to-date depreciation revealed an analogous pattern as described regarding third quarter of 2011 compared to the corresponding period in 2010.  On a nine-month basis drilling rig depreciation accounted for 96% of total depreciation expense (first three quarters of 2010 - 96%).

Selling and Administrative Expense

$ Million	Three Months Ended September 30					Nine Months Ended September 30
	2011	2010	Change	%Change		2011	2010	Change	%Change
Selling & Administrative Expense	4.2	3.4	0.8	24%		12.7	10.3	2.4	23%

The changeover from GAAP to IFRS did not affect the Company's recognition of selling and administrative expense per se.  However, selling and administrative expense increased $85,000 in the current quarter ($53,000 in the corresponding quarter of 2010) and $171,000 on a year-to-date basis in 2011 ($121,000 in the corresponding nine month period of 2010) as a result of the Company's change in revenue presentation as described in this MD&A under the section "Revenue and Operating & Maintenance Expenses".

Selling and administrative expenses were 7.6% of total revenue in the first nine months of 2011 compared to 9.9% of total revenue in the comparative period of 2010, largely as a result of increased revenue in 2011.  The single largest component was salaries and benefits, which accounted for 60% of these expenses (56% in 2010).

Income Tax Expense

$ Million	Three Months Ended September 30					Nine Months Ended September 30
	2011	2010	Change	% Change		2011	2010	Change	% Change
Current Tax Expense	2.3	0.9	1.4	156%		8.3	1.7	6.6	388%
Deferred Tax Expense	0.2	0.1	0.1	100%		(2.2)	(0.4)	(1.8)	450%
Total Income Tax Expense	2.5	1.0	1.5	150%		6.1	1.3	4.8	369%

The changeover from GAAP to IFRS did not affect methods used in determining income tax expense.  However, predominantly as a result of changes in balances reported for income before income taxes due to decreased operating and maintenance expense and increased depreciation expense, the amount reported as future income tax expense has increased.

Income tax expense increased to $6,050,000 in the first nine months of 2011 from $1,281,000 in the corresponding period in 2010, due to higher pre-tax income as well as one-time costs to repatriate one of the Company's rigs (hereinafter referred to as the "Arctic Wolf") from Alaska to Canada.

Net Income and Funds Flow

$ Million	Three Months Ended September 30					Nine Months Ended September 30
	2011	2010	Change	% Change		2011	2010	Change	% Change
Net Income	6.9	2.2	4.7	214%		16.4	2.6	13.8	531%
Funds Flow From Operations(Note)	12.8	8.5	4.3	51%		29.8	21.2	8.6	41%

Note: See commentary regarding non standard accounting measure

The changeover from GAAP to IFRS affected the reporting of both net income and funds flow from operations.  This was primarily due to a decrease in operating and maintenance expenses that was partially offset by an increase in depreciation expense.

Net income increased to $6,926,000 or $0.38 per Class A Non-Voting and Class B Common Share (basic and diluted) for the third quarter of 2011 from $2,215,000 or $0.12 per share (basic and diluted) in the third quarter of 2010.  Funds flow from operations increased to $12,825,000 in the third quarter of 2011 from $8,476,000 in the corresponding quarter in 2010.  The higher income and funds flow that occurred in the third quarter of 2011 compared to the corresponding period in 2010 was directly attributable to increased demand for AKITA's drilling services.

Net income increased to $16,375,000 or $0.90 per Class A Non-Voting and Class B Common Share (basic and diluted) for the first nine months of 2011 from $2,614,000 or $0.14 per share (basic and diluted) in the corresponding period of 2010.  Funds flow from operations increased to $29,776,000 in the first nine months of 2011 from $21,240,000 in the corresponding period in 2010.  Higher income and funds flow from operations that occurred in 2011 were directly attributable to higher activity levels and increased operating margins per day versus the corresponding period of 2010.

Fleet and Rig Utilization

AKITA had 37 drilling rigs, including seven that operated under joint ventures, (34.075 net to AKITA) at the end of the third quarter of 2011 compared to 39 rigs (35.225 net) in the corresponding period of 2010. Since last year, the Company retired two rigs and swapped its 50% interest in an additional rig for 100% of one of the two rigs swapped.  As well, the Company completed construction of one new rig which is owned 85% by AKITA.

In the third quarter of 2011, AKITA achieved 2,140 operating days, which corresponded to a utilization rate of 62.9% for the period.  In the third quarter of 2010, the Company achieved 1,387 operating days, representing 38.7% utilization. On a year-to-date basis during 2011, AKITA achieved 5,142 operating days, representing a utilization rate of 51.9%.  During the comparative period in 2010, the Company achieved 3,961 operating days, representing 37.2% utilization.  It should be noted that AKITA calculates utilization rates based upon rigs actively operating.  From time to time, AKITA has rigs receiving standby revenue.  Those rigs are not considered as contributing to the utilization statistic in AKITA's calculations.

During the first quarter of 2011, AKITA completed the Arctic Wolf retrofit.  This rig is currently working under a multi-year contract.  During the second quarter, the Company completed the construction and commenced a multi-year contract for a new pad rig.  Although the Company did not complete any additional rigs during the third quarter, it is continuing the construction of a pad rig which is scheduled for completion during the fourth quarter.  In addition, AKITA has commenced the conversion of one of its conventional large triple rigs into a pad rig.  This work is scheduled for completion near year-end.  Both of these rigs will be working under multi-year contracts once construction is complete.

Liquidity and Capital Resources

The changeover from GAAP to IFRS affected the balances reported and methods used in determining property, plant and equipment.  On January 1, 2010, the Company recorded an IFRS 1 exemption to report selected assets at fair value for deemed costs.  This exemption resulted in a reduction of carrying values of $32,578,000 at that date.  Certain expenditures that were previously recorded as maintenance expenses under GAAP are now recorded as property, plant and equipment under IFRS.  Depreciation is also measured on a more detailed component-by-component basis under IFRS rather than using an asset-by-asset basis used under GAAP.  This change in approach resulted in some differences that, depending on the actual assets being depreciated, had the effect of either increasing or decreasing the carrying values for property, plant and equipment.  In general, the more detailed component-by-component depreciation approach is not considered to produce changes that are material in amount especially when considered over extended periods.

The changeover from GAAP to IFRS did not affect the balances reported for working capital items for the Company.

As a result of a change in the estimate of useful lives for most of its rigs, the carrying values for property, plant and equipment are higher than they would have been if the previous estimates were continued.  Please refer to the depreciation discussion earlier in this document for further information.

Capital expenditures totalled $35,420,000 in the first nine months of 2011.  AKITA's emphasis on pad rigs has dominated capital expenditures during 2011.  Current year spending has been directed to the construction of a new pad rig, a major retrofit of an existing triple sized rig to enable it to efficiently drill pad locations, the retrofit of a conventional double rig that was relocated from Alaska to Alberta, the addition of a moving system onto a previously conventional double sized rig in order to perform pad drilling, the major retrofit of a second triple sized rig to enable it to efficiently drill pad locations and the addition of a moving system onto a previously conventional triple sized rig. While the final two upgrades listed above were still under construction at September 30, 2011, other projects are now complete and operational. Capital expenditures for the corresponding period in 2010 were $18,913,000.

During the third quarter of 2011, the Company repurchased 49,420 Class A Non-Voting Shares at an average cost of $10.81 per share pursuant to its Normal Course Issuer Bid.  On a year-to-date basis, AKITA repurchased 89,536 Class A Non-Voting Shares at an average cost of $11.31 per share.  During the first nine months of 2010, the Company repurchased 158,104 Class A Non-Voting Shares pursuant to its Normal Course Issuer Bid.

The Company had nine rigs under multi-year contracts at September 30, 2011.  Of these contracts, one is anticipated to expire in 2012, five in 2013 and three in 2014.

Forward-Looking Statements

From time to time AKITA makes forward-looking statements.  These statements include, but are not limited to, comments with respect to AKITA's objectives and strategies, financial condition, results of operations, the outlook for the industry and risk management.

By their nature, these forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and therefore carry the risk that the predictions and other forward-looking statements will not be realized.  Readers of this News Release are cautioned not to place undue reliance on these statements as a number of important factors could cause actual future results to differ materially from the plans, objectives, estimates and intentions expressed in such forward-looking statements.

Forward-looking statements may be influenced by factors such as the level of exploration and development activity carried on by AKITA's customers; world crude oil prices and North American natural gas prices; weather; access to capital markets and government policies.  We caution that the foregoing list of factors is not exhaustive and that investors and others should carefully consider the foregoing factors as well as other uncertainties and events prior to making a decision to invest in AKITA.

Selected financial information for the Company is as follows:

AKITA Drilling Ltd.
Condensed Consolidated Statements of Financial Position
Unaudited			September 30	September 30	December 31	January 1
(000's of Canadian Dollars)			2011	2010	2010	2010
				Restated (1)	Restated (1)	Restated (1)
Assets
Current Assets
	Cash and cash equivalents		$ 18,288	$ 41,073	$ 37,964	$ 34,142
	Term deposits		12,991	18,000	10,000	18,000
	Accounts receivable		45,390	22,125	33,339	28,523
	Income taxes recoverable		-	-	-	330
	Prepaid expenses and other		608	688	222	421
			77,277	81,886	81,525	81,416
Non-current Assets
Restricted cash			-	2,500	2,500	5,000
Property, plant and equipment			154,253	121,339	134,562	121,346
Total Assets			$ 231,530	$ 205,725	$ 218,587	$ 207,762
Liabilities
Current Liabilities
	Accounts payable and accrued liabilities		$ 19,216	$ 9,729	$ 18,830	$ 10,123
	Deferred revenue		815	985	-	197
	Dividends payable		1,264	1,266	1,269	1,277
	Income taxes payable		2,252	263	85	-
			23,547	12,243	20,184	11,597
Non-current Liabilities
Deferred income taxes			10,922	12,253	13,235	12,679
Pension liability			1,628	1,413	1,429	1,363
Total Liabilities			36,097	25,909	34,848	25,639
Shareholders' Equity
Class A and Class B shares			23,323	23,199	23,447	23,376
Contributed surplus			2,696	2,462	2,512	2,271
Accumulated other comprehensive income			-	14	50	-
Retained earnings			169,414	154,141	157,730	156,476
Total Equity			195,433	179,816	183,739	182,123
Total Liabilities and Equity			$ 231,530	$ 205,725	$ 218,587	$ 207,762
(1) Comparative financial information for 2010 has been restated for IFRS

 

AKITA Drilling Ltd.
Condensed Consolidated Statements of Net Income and Comprehensive Income
			Three Months Ended			Nine Months Ended			Year Ended
Unaudited			September 30			September 30			December 31
(000's of Canadian Dollars except per share amounts)			2011	2010		2011	2010		2010
				Restated (1)			Restated(1)		Restated(1)
Revenue			$ 54,874	$ 34,042		$ 143,969	$ 103,295		$ 145,138
		Operating and Maintenance	35,814	21,624		94,017	70,886		96,919
		Depreciation	5,647	6,030		15,606	18,861		24,540
		Selling and administrative	4,168	3,386		12,669	10,272		13,625
Total costs and expenses			45,629	31,040		122,292	100,019		135,084
Revenue less costs and expenses			9,245	3,002		21,677	3,276		10,054
Other income (losses)
		Interest income	163	192		505	570		798
		Interest expense	(4)	(16)		(11)	(20)		(25)
		Other gains and losses (net)	49	1		254	69		105
Total other income			208	177		748	619		878
Income before income taxes			9,453	3,179		22,425	3,895		10,932
Income taxes			2,527	964		6,050	1,281		3,462
Net income for the period attributable to shareholders			6,926	2,215		16,375	2,614		7,470
Other comprehensive income
Foreign currency translation adjustment			-	39		-	14		(146)
Comprehensive income for the period attributable to shareholders			$ 6,926	$ 2,254		$ 16,375	$ 2,628		$ 7,324
Earnings per Class A and Class B Share
		Basic	$ 0.38	$ 0.12		$ 0.90	$ 0.14		$ 0.41
		Diluted	$ 0.38	$ 0.12		$ 0.90	$ 0.14		$ 0.41
(1) Comparative financial information for 2010 has been restated for IFRS

 

AKITA Drilling Ltd.
Condensed Consolidated Statements of Cash Flow
			Three Months Ended			Nine Months Ended			Year Ended
Unaudited			September 30			September 30			December 31
(000's of Canadian Dollars)			2011	2010		2011	2010		2010
				Restated (1)					Restated(1)
Operating Activities
Net income			$ 6,926	$ 2,215		$ 16,375	$ 2,614		$ 7,470
Non-cash items included in net income
		Depreciation	5,647	6,030		15,606	18,861		24,540
		Deferred income taxes	181	99		(2,313)	(426)		556
		Expense for defined benefit pension plan	66	17		199	50		66
		Stock options charged to expense	62	119		184	191		241
		Gain on sale of joint venture interests in rigs and other assets	(57)	(4)		(275)	(50)		(75)
			12,825	8,476		29,776	21,240		32,798
Change in non-cash working capital			(14,814)	3,331		(9,074)	7,107		10,699
Net Cash from operating activities			(1,989)	11,807		20,702	28,347		43,497
Investing Activities
Capital expenditures			(13,317)	(9,050)		(35,420)	(18,913)		(36,293)
Reduction in cash restricted for loan guarantees			-	-		2,500	2,500		2,500
Proceeds on sale of joint venture interests in rigs and other assets			170	4		398	109		213
Net Cash used in investing activities			(13,147)	(9,046)		(32,522)	(16,304)		(33,580)
Financing Activities
Dividends paid			(1,264)	(1,260)		(3,802)	(3,812)		(5,079)
Proceeds received on exercise of stock options			-	-		-	32		280
Redemption of term deposits			5,499	-		(2,991)	-		-
Repurchase of share capital			(535)	-		(1,013)	(1,346)		(1,346)
Net Cash used in financing activities			3,700	(1,260)		(7,806)	(5,126)		(6,145)
Effect of exchange rate changes on cash and cash equivalents			-	39		(50)	14		50
Increase (Decrease) in Cash and Cash Equivalents			(11,436)	1,540		(19,676)	6,931		3,822
Cash and cash equivalents, beginning of period			29,724	39,533		37,964	34,142		34,142
Cash and Cash Equivalents, End of Period			$ 18,288	$ 41,073		$ 18,288	$ 41,073		$ 37,964
Included in Operating Activity:
		Interest paid during the period	$ 4	$ 14		$ 9	$ 17		$ 25
		Income taxes paid during the period	$ 4,026	$ (34)		$ 6,196	$ 1,119		$ 2,497
(1) Comparative financial information for 2010 has been restated for IFRS