Financial Performance

Goals

Churchill’s financial goal is to deliver consistently superior results and thus create value for shareholders.

Results

2011 Financial Highlights

(C$ millions except margins and per share amounts)	12 months ended Dec. 31
	2011	2010
Revenue	1,409.2	1,183.9
Contract income	157.9	144.4
Margin	11.2%	12.2%
EBITDA	72.0	71.8
Margin	5.1%	6.1%
Net earnings	24.9	34.2
Diluted earnings per share	$0.94	$1.55

Source: Corporate records

Although 2011 results were impacted by underperformance at Stuart Olson Dominion, the projects that were the primary cause of the reduced results were 94% complete as of December 31, 2011, and management expects Stuart Olson Dominion's results to show gradual improvement in the second half of 2012. For further information, please refer to Churchill’s 2011 Annual Report.

Balance Sheet Summary

(C$ millions)	Dec. 31, 2011	Dec. 31, 2010
Cash and cash equivalents	59.4	70.8
Current assets	481.5	484.4
Working capital	86.0	97.8
Long-term debt	60.4	74.1
Convertible debentures	76.7	74.5
Shareholders equity	309.2	289.3
Total assets	888.5	871.8
Backlog (1)	1,842.6	1,555.0

Source: Corporate records

Note: (1) Backlog is a non-IFRS measure that is the total value of work that has not yet been completed that (a) is assessed by the Corporation as having high certainty of being performed by the Corporation or its subsidiaries by either the existence of a contract or work order specifying job scope, value and timing, or (b) has been awarded to the Corporation or its subsidiaries, as evidenced by an executed binding or non-binding letter of intent or agreement, describing the general job scope, value and timing of such work, and with the finalization of a formal contract respecting such work currently assessed by the Corporation as being reasonably assured.

This table illustrates the continuing strength of Churchill’s balance sheet:

Debt / Total Capitalization of 31%;
Current Ration of 1.22 times; and
Interest coverage of 6.02 times.

For further information, please refer to Churchill’s 2011 Annual Report.

2012 Year-to-Date

(C$ millions except margins and per share amounts)	3 months ended March 31
	2011	2010
Revenue	333.2	304.7
Contract income	35.7	36.6
Margin	10.7%	12.0%
EBITDA	13.9	17.2
Margin	4.2%	5.6%
Net earnings	3.2	5.8
Diluted earnings per share	$0.13	$0.24
Dividends declared⁽¹⁾	$0.12	—

Source: Corporate records

Note: (1) On May 25, 2011 Churchill declared its first quarterly dividend in the amount of $0.12, payable July 15, 2011 to shareholders of record on June 30, 2011. Churchill has conrinued to pay quarterly dividends since that date. Please refer to the Dividends section under investors / Share Information.

In the first three months of 2012, Churchill grew its revenue by 9% over the first quarter of 2011 Earnings declined due to several factors, including:

losses from nearly complete underperforming fixed price projects in the General Contracting segment;
lower margins and higher indirect and administration expenses in the Commercial Services segment, partly due to the inclusion of McCaine (acquired April 29, 2011); and
training and recruiting costs, professional fees, and costs related to the optimization of the company's SAP-based ERP system.

2012 First Quarter Balance Sheet Summary

(C$ millions)	March 31, 2012	December 31, 2011
Cash and cash equivalents	28.6	59.4
Current assets	449.8	481.5
Working capital	102.6	86.0
Long-term debt	65.5	60.4
Convertible debentures	77.3	76.7
Shareholders equity	308.5	309.1
Total assets	856.4	888.5
Backlog ⁽¹⁾	1,751.5	1,842.6

Source: Corporate records

Note: ⁽¹⁾ Backlog is a non-IFRS measure that is the total value of work that has not yet been completed that (a) is assessed by the Corporation as having high certainty of being performed by the Corporation or its subsidiaries by either the existence of a contract or work order specifying job scope, value and timing, or (b) has been awarded to the Corporation or its subsidiaries, as evidenced by an executed binding or non-binding letter of intent or agreement, describing the general job scope, value and timing of such work, and with the finalization of a formal contract respecting such work currently assessed by the Corporation as being reasonably assured.

In the first quarter of 2012, Churchill maintained a strong working capital position and healthy balance sheet with:

Debt / Total Capitalization of 32%;
Current Ration of 1.30 times; and
Interest coverage of 5.67 times.