CALGARY, Alberta, Aug. 15, 2019 (GLOBE NEWSWIRE) -- CORDY OILFIELD SERVICES INC. (the “Corporation” or “Cordy”) (CKK:TSX-V) released today its second quarter 2019 results.
|Three months ended June 30,||Six months ended June 30,|
|($ 000's)||2019||2018||($) Change||2019||2018||($) Change|
|Direct operating expenses|
|General and administrative expenses|
|Operating earnings (loss) (1)|
|Gain (loss) on disposal||(397)||(165)||(232)||(397)||(184)||(213)|
|Earnings (loss) before tax||93||(365)||458||384||(170)||554|
|Income tax expense||-||-||-||-||-||-|
|Net earnings (loss)||93||(365)||458||384||(170)||554|
SECOND QUARTER ENDED JUNE 30, 2019
For the six month period ended June 30, 2019, Cordy's consolidated revenues increased by $0.4 million or 4 percent, from the comparative period in 2018. Cordy’s consolidated operating earnings increased $0.5 million or 58 percent from the comparative period. Cordy’s net income was $0.4 million for the six months ended June 30, 2019, as compared to a net loss of $0.2 million for the six months ended June 30, 2018, representing a 326 percent increase over prior year.
The Environmental Services saw marginally increased revenue for the six months ended June 30, 2019, of $0.3 million, from the comparative period in 2018. Cordy’s diversification strategy is continuing to yield results, as Cordy continues to see expansion in municipal and industrial demand. Environmental Services’ revenue was made up of 66 percent from municipal and industrial customers (2018- 47 percent) and 34 percent oilfield (2018 – 53 percent). Environmental Services’ operating earnings increased to $1.7 million from $1.2 million in 2018, as a percentage of revenue operating earnings was 20 percent in 2019 as compared to 15 percent in 2018.
The Construction segment saw minimal changes in revenue for the six months ended June 30, 2019 compared to the six months ended June 30, 2018; this is due to the reduced demand for services and minimal activity year over year.
Cordy’s second quarter results met our expectations and reflect the previous commentary surrounding modest growth and ongoing challenges around margin in these new market realities. In the quarter Cordy benefited from its diversification focus, by growing both the industrial and municipal service side of the business. Cordy continues to benefit from its acquisition of Hornet Hydrovac (“Hornet”) through expanded service offerings to pre-existing Hornet customers and further building relationships in the hydro excavation market.
In the quarter Cordy disposed of underutilized equipment for proceeds of over $1.0 million, and a gain on sale of $0.4 million. Cordy will continue to re-evaluate its equipment mix to ensure capital is being allocated for the highest return. For the balance of 2019 Cordy will remain focused on managing costs. Cordy believes the second half of 2019 will trend similar to the first half, with continued growth similar to levels seen in the first six months of 2019 as compared to 2018. Cordy believes it has positioned itself through its diversified customer base, debt structure, service offerings and lean cost base to see continued growth in the municipal, industrial and oilfield market for the foreseeable future.
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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Chief Executive Officer
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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.