Cordy Oilfield Services Inc. Reports Fourth Quarter and 2018 Annual Results
April 25, 2019 - 7:40 PM EDT
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Cordy Oilfield Services Inc. Reports Fourth Quarter and 2018 Annual Results
CALGARY, Alberta, April 25, 2019 (GLOBE NEWSWIRE) --
CORDY OILFIELD SERVICES INC. (the “Corporation” or “Cordy”) (CKK: TSX-V) released today its fourth quarter and 2018 annual results.
Three months ended December 31
Twelve months ended December 31
($ 000's)
2018
2017
($) Change
2018
2017
($) Change
Revenue
Environmental Services
3,322
2,580
742
15,337
10,659
4,678
Heavy Construction
102
155
(53
)
439
471
(32
)
Corporate
14
4
10
30
52
(22
)
3,438
2,739
699
15,806
11,182
4,624
Direct operating expenses
Environmental Services
2,846
2,012
834
12,221
8,078
4,143
Heavy Construction
87
(1,010
)
1,097
327
(1,028
)
1,355
Corporate
-
1,148
(1,148
)
-
1,161
(1,161
)
2,933
2,150
783
12,548
8,211
4,337
General and administrative expenses
Environmental Services
183
(1
)
184
760
394
366
Heavy Construction
1
(52
)
53
2
(46
)
48
Corporate
260
299
(39
)
953
1,065
(112
)
444
246
198
1,715
1,413
302
Operating earnings (loss)
Environmental Services
293
569
(276
)
2,356
2,187
169
Heavy Construction
14
1,217
(1,203
)
110
1,545
(1,435
)
Corporate
(246
)
(1,443
)
1,197
(923
)
(2,174
)
1,251
61
343
(282
)
1,543
1,558
(15
)
Normalized operating earnings (loss)
Environmental Services
324
489
(165
)
2,613
2,116
497
Heavy Construction
14
80
(66
)
109
70
39
Corporate
(246
)
(296
)
50
(923
)
(1,029
)
106
92
273
(181
)
1,799
1,157
642
Depreciation
471
550
(79
)
1,900
2,211
(311
)
Financing expense
181
110
71
652
870
(218
)
Gain on disposal
(300
)
(5
)
(295
)
(428
)
(81
)
(347
)
Share-based recovery
-
-
-
-
(40
)
40
Loss before tax
(291
)
(312
)
21
(581
)
(1,402
)
821
Income tax expense
-
-
-
-
-
-
Net loss
(291
)
(312
)
21
(581
)
(1,402
)
821
YEAR ENDED DECEMBER 31, 2018
In 2018, Cordy's consolidated revenues increased by $4.6 million or 41 percent, from the same period in 2017. 2018 continued to be a difficult year for oilfield service companies throughout Western Canada. The crippling price of crude continued to hinder drilling programs for all producers and in turn negatively impacted demand for oilfield services. Despite the hostile environment and continued headwinds, Cordy continues to push the sales front and saw a strong 41 percent increase to revenue in 2018. This is attributed to competitive pricing and customer diversification as Cordy focuses on the municipal and industrial services, while continuing to make strides on the market share of the oilfield side.
Cordy’s normalized operating earnings increased by $0.6 million or 55 percent over 2017. Cordy continues to promote a cost-conscious culture and realizes that managing margins is critical for success in the difficult business environment Cordy operates.
Overall consolidated net loss for 2018 improved by $0.8 million or 59 percent as compared to 2017. Cordy’s improving operating results, reduced interest rate on debt and diminishing balance calculation of depreciation continue to improve earnings.
CORPORATE OUTLOOK
Cordy continues to see increase demand for services as compared to the previous year. A steady supply of municipal infrastructure projects, as well as an increase in oilfield market share, has had a positive impact on financial results. Although pricing levels have remained competitive, Cordy’s continued focus on selling, coupled with benefits associated with its acquisition of Hornet Hydrovac (“Hornet”), continue to yield results. Cordy will continue to expand service offerings to pre-existing Hornet customers and further build relationships in the hydro excavation market.
Cordy anticipates the year over year trend experienced in 2018 to carry into 2019. Cordy expects 2019 will surpass 2018 numbers, while management continues to scrutinize costs and improve margins. Current trends in the oil and gas sector will continue to be a concern, however Cordy will continue to push for increased market share as our competitors fail to withstand the prolonged downturn. Cordy believes it has positioned itself through its diversified customer base, debt structure, service offerings and lean cost base to be a major player in the municipal, industrial and oilfield market for the foreseeable future. As Cordy’s competitors continue to struggle, Cordy consistently sees improved results as Cordy’s management made the necessary changes to realize profit in these new market realities.
While remaining focused on operational and financial performance, Cordy will continue to seek out acquisitions and or consolidation opportunities that complement its diversification strategy and provide platforms for organic growth. Cordy is actively reviewing numerous opportunities, however Cordy will remain committed to ensuring any acquisition meets our strategic initiatives and financial thresholds. Cordy will continue to consider multiple avenues to reach strategic objectives and provide shareholder value.
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Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
READER ADVISORY
This News Release contains certain statements that constitute forward-looking statements. These statements relate to future events or the Corporation’s future performance. All statements, other than statements of historical fact, that address activities, events or developments that the Corporation or a third party expects or anticipates will or may occur in the future, are forward-looking statements. These include the Corporation’s future growth, results of operations, performance and business prospects and opportunities; prevailing economic conditions; commodity prices; sourcing, pricing and availability of raw materials, components and parts, equipment, suppliers, facilities and skilled personnel; dependence on major customers; uncertainties in weather and temperature affecting the duration of the service periods and the activities that can be completed; regional competition; and other factors, many of which are beyond the Corporation’s control. These other factors include future prices of oil and natural gas and oil and natural gas industry activity, including the effect of changes in commodity prices on oil and natural gas exploration and development activity, the ability to complete strategic acquisitions and realize the anticipated benefits of any acquisitions that are completed, the Corporation’s outlook regarding the competitive environment it operates in, and the assumptions underlying any of the foregoing. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions. These statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the Corporation’s control, including those discussed under “Risks and Uncertainties” and elsewhere in this News Release, that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Corporation believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this News Release should not be unduly relied upon. These statements speak only as of the date of this News Release. The Corporation does not intend, and does not assume any obligation, to update these forward-looking statements, whether as a result of new information, future events or otherwise, except as required under applicable securities laws. The forward-looking statements contained in this News Release are expressly qualified by this cautionary statement.
