C.A.T. oil Maintains Positive Growth Momentum in Q3 2011

C.A.T. oil AG (O2C, ISIN: AT0000A00Y78), one of the leading
providers of oil and gas field services in Russia and Kazakhstan, today
announced its results for the third quarter and the first nine months of
2011. Backed by the continued positive growth momentum of the second
quarter, C.A.T. oil continued the positive trend in Q3, achieved a new
record in job count and increased the average per job revenue. Thus, the
Company increased its Q3 revenues by 14.3% yoy to EUR 74.7 million (Q3
2010: EUR 65.4 million) and achieved a 20.6% yoy growth in revenues to
EUR 209.7 million on a nine month basis (9M 2010: EUR 173.8 million).
The Company increased its EBITDA by 13.8% yoy to EUR 18.9 million for Q3
(Q3 2010: EUR 16.6 million) and by 5.7% yoy to EUR 45.9 million for 9M
(9M 2010: 43.5 million). Despite the front-loaded costs related to the
business expansion, C.A.T. oil operated on a very profitable basis: The
EBITDA margin amounted to 25.3% for Q3 (Q3 2010: 25.4%) and reached a
respectable level of 21.9% for the first nine months (9M 2010: 25.0%).
Based on the strong performance during the first three quarters, C.A.T.
oil specifies its outlook and sees itself well on track to successfully
reach its goals for the full year 2011.

Manfred Kastner, CEO of C.A.T. oil, commented: 'We have worked hard to
grow our business and successfully utilize the positive momentum to push
our activity levels to a new record high for both, Q3 as well as 9M
2011. We are now approaching the finishing line in successfully reaching
our goals for the year.?

Manfred Kastner continues: 'C.A.T. oil is well known for its efficiency
and high operating standards. We therefore remain absolutely focused on
our quality approach while diversifying into high class conventional
drilling. We view conventional drilling as yet another important growth
driver for our business from 2012 onwards and are currently completing
the talks with our customers on the deployment of our new rigs.?

All-time-high in Q3 and 9M activity levels

Thanks to a sustainable growth of demand for its core services, C.A.T.
oil enjoyed an all-time-high in the operating activity levels in Q3 and
9M 2011. The Company′s Q3 total service job count rose 10.0% yoy to 930
jobs (Q3 2010: 846 jobs), driving the 9M total job count up 14.3% yoy to
2,578 jobs (9M 2010: 2,255 jobs). For 9M 2011, C.A.T. oil expanded its
fracturing and sidetrack drilling operations by 17.9% yoy and 14.7% yoy,
respectively. The high operating volumes compounded by improvements in
the average per job revenues significantly contributed to boost revenues
in Q3 and 9M.

Cost base reflects higher operating activity levels and front-loaded
costs for business expansion

Cost of sales rose by 19.2% yoy to EUR 61.4 million in Q3 2011 (Q3 2010:
EUR 51.5 million) and 26.1% yoy to EUR 177.4 million in 9M 2011 (9M
2010: EUR 140.7 million), reflecting higher operating activity levels,
the effects of the accomplished outsourcing of the workover business,
slower sidetrack drilling operations in Q1 as well as the front-loaded
costs for the expansion into high class conventional drilling. The first
conventional drilling rig has already been in operation since July 2011;
seven more new rigs have to date been shipped to Russia and are
currently being cleared at customs or adapted for operations. By the end
of the year all the new rigs will have arrived in Russia and will be put
into operation consecutively.

General and administrative expenses went up 1.4% yoy to EUR 4.7 million
in Q3 2011 (Q3 2010: EUR 4.6 million) and 3.7% yoy to EUR 14.3 million
in 9M 2011 (9M 2010: EUR 13.8 million) primarily driven by the costs
related to the expansion of the business. The total weighted average
headcount decreased by 2.2% yoy to 2,373 employees in 9M 2011 (9M 2010:
2,427 employees) reflecting the headcount reduction due to the
outsourced workover operations; at the same time C.A.T. oil made new
hires for the set up of conventional drilling.

Profitable growth despite substantial investments

Despite the substantial investments in growth and diversification during
the reporting period, C.A.T. oil succeeded to operate on a highly
profitable basis. Earnings before interest, tax and depreciation
(EBITDA) increased by 13.8% yoy to EUR 18.9 million in Q3 2011 (Q3 2010:
EUR 16.6 million) and 5.7% yoy to EUR 45.9 million in 9M 2011 (9M 2010:
EUR 43.5 million). The Company sustained a strong EBITDA margin at 25.3%
in Q3 2011 (Q3 2010: 25.4%) and achieved a very respectable EBITDA
margin level of 21.9% in 9M 2011 (9M 2010: 25.0%). The Company′s
earnings before interest and tax (EBIT) contracted 6.7% yoy to EUR 8.7
million in Q3 2011 (Q3 2010: EUR 9.3 million) and 14.0% yoy to EUR 18.6
million in 9M 2011 (9M 2010: EUR 21.6 million) due to higher
depreciation expenses arising from investments in the new operating
capacities. Net income was down 25.0% yoy to EUR 5.8 million in Q3 2011
(Q3 2010: EUR 7.7 million) and 22.0% yoy to EUR 12.6 million in 9M 2011
(9M 2010: EUR 16.2 million) and primarily reflects an increase in
depreciation and foreign currency translation losses on the
inter-company euro-denominated loans which C.A.T. oil AG grants to its
subsidiaries for investment purposes on a long-term basis.

Cash flow reflects business expansion, equity ratio remains strong

In 9M 2011, funds from operations went down 11.2% yoy to EUR 40.4
million (9M 2010: EUR 45.5 million) primarily due to a lower pre-tax
profit. Cash flow from operating activities was a net inflow of EUR 30.1
million (9M 2010: net inflow of EUR 45.0 million) due to the higher net
working capital which was driven by investments. Capital expenditure
rose 186.3% yoy to EUR 83.0 million (9M 2010: EUR 29.0 million)
primarily due to investments in the new rigs. Cash flow from investing
activities was a net outflow of EUR 81.8 million (9M 2010: net outflow
of EUR 24.8 million). Cash flow from financing activities was a net
inflow of EUR 52.3 million in 9M 2011 (9M 2010: net outflow of EUR 12.9
million) mainly due to an increase in long-term borrowings for
investment purposes.

As of 30 September 2011, cash and cash equivalents amounted to EUR 32.8
million (31 December 2010: EUR 34.1 million). C.A.T. oil′s equity ratio
remained at a comfortable level of 65.4% as of 30 September 2011 (31
December 2010: 83.2%)

Outlook for the full year 2011 specified

In Q3, C.A.T. oil obtained new orders and extensions to the existing
contracts from its customers for 2011. Therefore, the Company
anticipates that despite the routine seasonal slowdown in Q4 the
operating activity levels will stay at least at par with Q4 2010 this
year. In addition, based upon the positive developments during the first
nine month, C.A.T. oil specifies its outlook for the full year 2011 and
expects revenues between EUR 260 million and EUR 270 million (based on a
euro/rouble exchange rate of 41). Despite cost pressures from foreign
exchange rates and the expansion into conventional drilling, C.A.T. oil
remains committed to profitable growth and aims at an EBITDA margin of
between 21% and 22% for the full year 2011.

The Company is currently actively engaged in the 2012 tendering
campaign. Despite the current turbulences on the global capital markets
and the economic uncertainties, the macroeconomic environment in Russia
and Kazakhstan is stable and customers are planning with extended
working programs. As a consequence, at this point in time C.A.T. oil
views the incremental service orders for 2012 as positive.

www.catoilag.com

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Carolin Amann

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or

Thomas
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