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

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Cordy Oilfield Services Inc.
·6-min read
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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)

2020

2019

($) Change

2020

2019

($) Change

Revenue

Environmental Services

5,707

3,450

2,257

18,264

15,834

2,430

Heavy Construction

25

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 Services

4,344

3,231

1,113

13,491

12,561

930

Heavy Construction

20

66

(46

)

138

297

(159

)

Corporate

-

-

-

-

-

-

4,364

3,297

1,067

13,629

12,858

771

General and administrative expenses

Environmental Services

144

169

(25

)

655

756

(101

)

Heavy Construction

-

-

-

2

2

-

Corporate

355

197

158

983

921

62

499

366

133

1,640

1,679

(39

)

Operating earnings (loss) (1)

Environmental Services

1,219

50

1,169

4,118

2,517

1,601

Heavy Construction

5

36

(31

)

157

217

(60

)

Corporate

(355

)

(197

)

(158

)

(968

)

(916

)

(52

)

869

(111

)

980

3,307

1,818

1,489

Depreciation

533

501

32

2,275

1,970

305

Financing expense

396

206

190

1,124

803

321

Gain on disposal

(159

)

-

(159

)

(159

)

(483

)

324

Loss before tax

99

(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 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.