CALGARY, Alberta, May 23, 2018 (GLOBE NEWSWIRE) -- CORDY OILFIELD SERVICES INC. (the “Corporation” or “Cordy”) (TSX-V: CKK ) released today its first quarter 2018 results.
| Three months ended March 31, | ||||||
| ($ 000's) | 2018 | 2017 | ($) Change | |||
| Revenue | ||||||
| Environmental Services | 4,983 | 3,607 | 1,376 | |||
| Heavy Construction | 142 | 74 | 68 | |||
| Corporate | 2 | 13 | (11 | ) | ||
| 5,127 | 3,694 | 1,433 | ||||
| Direct operating expenses | ||||||
| Environmental Services | 3,938 | 2,701 | 1,237 | |||
| Heavy Construction | 103 | (113 | ) | 216 | ||
| Corporate | - | 8 | (8 | ) | ||
| 4,041 | 2,596 | 1,445 | ||||
| General and administrative expenses | ||||||
| Environmental Services | 137 | 132 | 5 | |||
| Heavy Construction | - | 3 | (3 | ) | ||
| Corporate | 177 | 294 | (117 | ) | ||
| 314 | 429 | (115 | ) | |||
| Operating earnings | ||||||
| Environmental Services | 908 | 774 | 134 | |||
| Heavy Construction | 39 | 184 | (145 | ) | ||
| Corporate | (175 | ) | (289 | ) | 114 | |
| 772 | 669 | 103 | ||||
| Depreciation | 481 | 553 | (72 | ) | ||
| Finance costs | 114 | 276 | (162 | ) | ||
| Gain on disposal | (18 | ) | (17 | ) | (1 | ) |
| Share based recovery | - | (16 | ) | 16 | ||
| Earnings (loss) before tax | 195 | (127 | ) | 322 | ||
| Income tax expense | - | - | - | |||
| Net earnings (loss) | 195 | (127 | ) | 322 | ||
FIRST QUARTER ENDED MARCH 31, 2018
For the three month period ended March 31, 2018, Cordy's consolidated revenues increased by $1.4 million or 39 percent, from the comparative period in 2017. Cordy's consolidated operating earnings increased $0.1 million or 15 percent from the comparative period.
The Environmental Services segment saw an increase in revenue for the three month period ended March 31, 2018, of $1.4 million, from the comparative period in 2017. The gradual recovery of commodity prices has resulted in increased capital spending of Environmental's oilfield customers, which in turn has resulted in increased demand for services. As a percentage of revenue, operating earnings was 18 percent in 2018 as compared to 21 percent in 2017.
Cordy’s net income was $0.2 million for the three months ended March 31, 2018, as compared to a net loss of $0.1 million for the three months ended March 31, 2017, representing a 253% increase over the prior period. Cordy’s improving results and reduced borrowing rate continue to improve earnings.
OUTLOOK
Cordy’s results for the current quarter were consistent with our expectations and aligned with prior commentary surrounding cautious optimism and increased activity in the oil and gas sector. In the quarter Cordy benefited directly from increased drilling by our major customers and seized additional market share. Despite increased demand, costs continue to deplete already thin margins, increasing fuel prices and changes in labour laws surrounding statutory holidays continue to compile additional expenditures, with little opportunity to increase pricing.
Cordy continues to hold the view that the economic outlook, while not robust, will grow modestly in 2018. Cordy believes that continued pipeline disputes will continue to be a limiting factor to growth in the oil and gas industry. The Company will continue to benefit from increased municipal infrastructure spending; management will continue to focus on its diversification strategy and to seek out opportunities in the municipal market that aligns with management’s strategy to build a broader client base in non-oilfield related businesses.
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 we 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.
For general and investor relations information, please contact:
Investor Relations
Darrick Evong
Chief Executive Officer
IR@cordy.ca
Tel: 403-262-7667
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.
