Logan International Reports Fourth Quarter and FY 2010 Results

Logan International Inc. (TSX:LII) ("Logan International") today announced its 2010 fourth quarter and fiscal year-end financial results. For the 2010 fourth quarter, the Company earned $598 thousand from continuing operations or $0.02 per diluted share as compared to a loss from continuing operations of $698 thousand or $(0.71) per diluted share in last year's fourth quarter. Fourth quarter 2010 revenue increased to $43.1 million from $15.3 million in the fourth quarter of 2009. This year's fourth quarter Modified EBITDA, as defined in the financial table below, increased to $7.8 million from $1.5 million in last year's fourth quarter. Among other items, the Company's results included a contingent compensation expense of $2.0 million payable under the Source Energy Tool Services Inc. ("Source") Purchase Agreement which resulted from Source's 2010 growth in sales of its patented multi-zonal fracturing system.

The Company reported earnings from continuing operations of $4.6 million or $0.14 per diluted share for the year 2010 as compared to $1.4 million or $1.50 per diluted share in the nine month period ended December 31, 2009. Earnings per share in the year ended 2010 were affected by the increase in the number of outstanding shares due to the merger with Destiny Resource Services Corp. Revenues were $139.3 million in the year ended December 31, 2010 and $45.5 million in the nine month period ended December 31, 2009. Modified EBITDA for the year ended December 31, 2010 increased to $25.7 million from $7.1 million in the nine month period ended December 31, 2009. The increases in revenues and operating performance are due to the contributions from the acquisitions made in 2010 and operating improvement in the Company's downhole tools businesses as well as the difference in the length of the comparison periods.

Gerald Hage, Logan CEO, attributed the improved results mostly to the marked improvement in activity levels in the energy industry in general and the Company's execution in particular. The downhole tool segment continued its strong operating performance in the fourth quarter, benefitting from the improvement in the energy industry fundamentals. Demand for all of the Company's products and services, as evidenced by the backlog, remains solid. The front-end seismic services business provided marginally positive EBITDA in its seasonally weak fourth quarter.

Mr. Hage summarized, "We are very pleased with our financial and operating results for the quarter and for the year. We are equally proud of the progress we have made in the execution of our consolidation strategy. We have streamlined our front-end seismic services segment and expect a consistent improvement in operating performance from this segment in 2011. In addition, we are extending our downhole tool segment over the US – Canadian border as we have introduced the Multi-Stim technology in the Northern United States and are in the process of opening a Logan Oil Tool sales location in Edmonton, Alberta. Our successes in 2010 confirm our commitment to building a leading downhole tool company focused on both organic and acquired growth."

Recent highlights include:

During the fourth quarter, we ran 46 multi-zonal completions including our first two completions in the United States portion of the Bakken formation.

Implemented price increases in our fishing and stroking tool product lines as a result of cost increases witnessed in 2010.

Recently, Logan International appointed David Jones to Chief Operating Officer of the Downhole Tool segment from Chief Financial Officer and Lawrence Keister to Chief Financial Officer from Chief Accounting Officer.

Selected Consolidated Financial Information
(in thousands of US dollars, except per share data)

		Three months ended December 31			,	Twelve months ended December 31	,	Nine months ended December 31	,
		2010		2009		2010		2009
Revenue:
	Downhole tools	$ 31,815		$ 15,319		$ 108,591		$ 45,504
	Front-end seismic services	11,311		-		30,678		-
		43,126		15,319		139,269		45,504

Operating income (loss):
	Downhole tools	5,298		233		23,995		4,237
	Front-end seismic services	(1,116	)	-		(6,653	)	-
	Corporate expenses	(1,833	)	(1,280	)	(7,548	)	(2,668	)
		2,349		(1,047	)	9,794		1,569

Net income (loss) from continuing operations		$ 598		$ (698	)	$ 4,568		$ 1,412

Earnings (loss) per share from continuing operations:
	Basic	$ 0.02		$ (0.71	)	$ 0.16		$ 1.50
	Diluted	$ 0.02		$ (0.71	)	$ 0.14		$ 1.50

EBITDA (1)		$ 5,609		$ 605		$ 19,682		$ 5,993
EBITDA – modified (1)		$ 7,767		$ 1,454		$ 25,651		$ 7,092

						December 31,
						2010		2009
Working Capital						$ 26,599		$ 38,517
Total Assets						$210,210		$126,037
Debt (2)						$ 35,927		$ 15,851
Shareholders' Equity						$127,868		$ 91,444

Note: On March 1, 2010, the merger between Destiny Resource Services Corp ("Destiny") and Logan Holdings, Inc. ("Logan") (the "Destiny Merger") was completed as a reverse takeover. Accounting treatment requires the presentation of the financial statements of Logan on a historic basis as if Logan acquired Destiny. As such, the results for the year ended December 31, 2010 include the results of the Logan operations for the entire period and the results of Destiny's operations from March 1, 2010 through December 31, 2010 and the comparative results for the nine month period ended December 31, 2009 include only the results of Logan's operations. In addition, the purchase of Source was completed on April 30, 2010 and the purchase of Complete Oil Tools Inc. ("Complete") was completed with an effective date of July 31, 2010. The Source results from May 1, 2010 through December 31, 2010 and the Complete results from August 1, 2010 to December 31, 2010 are included in the Logan International results.

EBITDA and Modified EBITDA do not have standardized meanings prescribed by Canadian generally accepted accounting principles ("GAAP"). Management believes that, in addition to net income, EBITDA and Modified EBITDA are useful supplemental measures. EBITDA and Modified EBITDA are provided as measures of operating performance without reference to financing decisions, depreciation and amortization, stock-based compensation or income tax impacts and, in the case of Modified EBITDA, certain non-recurring items, which are not controlled at the operating management level. Investors should be cautioned that EBITDA and Modified EBITDA should not be considered as alternatives to net income determined in accordance with GAAP as indicators of Logan International's performance. EBITDA is calculated as net income (loss) from continuing operations adjusted for depreciation and amortization, recurring stock-based compensation, interest expense and income taxes. Modified EBITDA removes the effect of the following non-recurring items: professional fees incurred as a result of the Destiny Merger, the acquisitions of Dennis Tool Company, Source, Complete, and other potential acquisitions; non-recurring compensation expenses related to severance payments, the accelerated recognition of non-cash stock-based compensation resulting from the Destiny Merger and contingent compensation amounts due to the Source shareholders as a result of the post-acquisition financial performance. Logan International's method of calculating EBITDA and Modified EBITDA may differ from that of other corporations and, accordingly, may not be comparable to measures used by other corporations.

		Three months ended December 31			,	Year ended December 31	,	Nine months ended December 31	,
		2010		2009		2010		2009

Net income (loss) from continuing operations		$ 598		$ (698	)	$ 4,568		$ 1,412
Addbacks:
	Depreciation and amortization	2,916		1,149		8,955		2,870
	Interest	699		(1	)	1,657		777
	Income tax expense	1,221		(84	)	3,803		481
	Stock-based compensation, recurring	175		239		699		453
EBITDA		5,609		605		19,682		5,993
Adjustments:
	Contingent compensation expense	1,984		-		1,984		-
	Transaction fees	243		849		2,514		1,099
	Stock-based compensation, non-recurring	(95	)	-		805		-
	Severance costs	26		-		666		-
Modified EBITDA		$ 7,767		1,454		$ 25,651		$ 7,092

Includes bank and other borrowed debt and capital leases.

Forward-Looking Statements

This press release contains forward-looking statements. These statements relate to future events or future performance of Logan International. When used in this press release, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "propose", "expect", "potential", "continue", and similar expressions, are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such statements reflect Logan International's current views with respect to certain events and are subject to certain risks, uncertainties and assumptions. Although Logan International believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because we can give no assurance that they will prove to be correct. Many factors could cause Logan International's actual results, performance, or achievements to materially differ from those described in this press release. Readers are referred to Logan International's Annual Information Form filed on [ http://www.sedar.com ] identifies significant risk factors which could cause actual results to differ from those contained in the forward-looking statements. Should one or more risks or uncertainties materialize or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this press release. The forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. These statements speak only as of the date of this press release. Logan International does not intend and does not assume any obligation, to update these forward-looking statements to reflect new information, subsequent events or otherwise, except as required by law.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities described herein in any jurisdiction.

For more information about Logan International Inc. please visit our website at [ www.loganinternationalinc.com ]

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Logan International Reports Fourth Quarter and FY 2010 Results