Cordy Oilfield Services Inc. Reports Fourth Quarter and 2020 Annual Results

April 22, 2021 7:49 PM EDT

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CALGARY, Alberta, April 22, 2021 (GLOBE NEWSWIRE) -- CORDY OILFIELD SERVICES INC. (the “Corporation” or “Cordy”) (CKK: TSX-V) released today its fourth quarter and 2020 annual results.

 Three months ended December 31 Twelve months ended December 31
($ 000's)20202019($) Change 20202019($) Change
Revenue       
Environmental Services5,707 3,450 2,257  18,264 15,834 2,430 
Heavy Construction25 102 (77) 297 516 (219)
Corporate- - -  15 5 10 
 5,732 3,552 2,180  18,576 16,355 2,221 
Direct operating expenses        
Environmental Services4,344 3,231 1,113  13,491 12,561 930 
Heavy Construction20 66 (46) 138 297 (159)
Corporate- - -  - - - 
 4,364 3,297 1,067  13,629 12,858 771 
        
General and administrative expenses       
Environmental Services144 169 (25) 655 756 (101)
Heavy Construction- - -  2 2 - 
Corporate355 197 158  983 921 62 
 499 366 133  1,640 1,679 (39)
Operating earnings (loss) (1)       
Environmental Services1,219 50 1,169  4,118 2,517 1,601 
Heavy Construction5 36 (31) 157 217 (60)
Corporate(355)(197)(158) (968)(916)(52)
 869 (111)980  3,307 1,818 1,489 
        
Depreciation533 501 32  2,275 1,970 305 
Financing expense396 206 190  1,124 803 321 
Gain on disposal(159)- (159) (159)(483)324 
Loss before tax99 (818)917  67 (472)539 
Income tax expense- - -  - - - 
Net income (loss)99 (818)917  67 (472)539 

YEAR ENDED DECEMBER 31, 2020

Despite continued market challenges throughout 2020, Cordy's consolidated revenues increased by $2.2 million or 14 percent, from the comparative period in 2019 and operating earnings increased $1.5 million or 82 percent from the comparative period. The net result was a consolidated operating margin of 17.8% compared to 11.1% on 2019.

Cordy’s improved performance was driven by strong first and fourth quarters. Primarily, a short-lived revival of the Oil & Gas sector in Western Canada, pre COVID-19 onslaught, drove the Q1 results, while infrastructure support services anchored the Q4 performance.

In addition to the Q1 and Q4 performance, Cordy achieved the following:

  • Closed acquisition of Platinum North Resources Ltd. and Heart River Holdings at the end of first quarter
    • enhanced Cordy’s geographic reach and suite of environmental services
    • softened the impact on performance from COVID-19
    • improved net-asset position
  • Restructured lending agreements providing additional flexibility and cashflow for operations through COVID-19
  • Strengthened the executive team adding new COO and CFO
  • Closed Joint Venture agreement with indigenous owned company expanding Cordy’s opportunities in B.C.

Overall, Cordy continued to show its resilience in 2020, increasing both revenue and income during unprecedented times. The COVID-19 outbreak caused major economic turmoil, including business interruption from government mandated shutdowns, and significant cuts in customer spending. While Cordy was not immune to the impacts of COVID-19, management made critical decisions in 2020, which helped offset the impact of COVID-19 on overall performance as compared to 2019.

CORPORATE OUTLOOK

In March 2020, the World Health Organization declared a global health pandemic due to COVID-19. Despite the near-term market uncertainty resulting from the ongoing COVID-19 pandemic, the Company’s fourth quarter continued to improve sequentially not only over the prior three quarters, but over the prior year. Cordy demonstrated incredible business resiliency in a year of unprecedented challenges for our industry and country. Cordy’s oilfield customers reactivated drilling programs albeit at a reduced level, early in the fourth quarter, and are expected to continue drilling programs through the end of the first quarter of 2021.

The uncertainty around the prolonged effects of COVID-19, the timing and availability of the vaccinations, and strict lock-downs due to recent surges, and new more infectious variants, continue to provide the Company with challenges and any change in the current trends could significantly alter management’s expectations over the medium term.

The timing of a full rebound in activity remains uncertain; however, the recent announcements showing safe, effective coronavirus vaccines, provide optimism for the continuation of gradual recovery over the next six to twelve months. The Company is continuing to evaluate its growth strategy while aggressively managing its costs and continuing to focus on the health and safety of its employees, contractors, and customers, ensuring it is doing its part in mitigating the spread, and limiting the impact of COVID-19.

For general and investor relations information, please contact:

Investor RelationsDarrick EvongChief Executive OfficerIR@cordy.caTel: 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.

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Source: Cordy Oilfield Services Inc.


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