CALGARY, ALBERTA--(Marketwired - Dec. 30, 2013) - New West Energy Services Inc. (TSX VENTURE:NWE) (the "Corporation") is pleased to announce the financial results for the Corporation for its second quarter ended October 31, 2013.
Operational and Financial Results for the second quarters ended October 31, 2013 and 2012:
- Revenue of $4.833 million ($5.016 million for 2012).
- Gross margin of $1.318 million ($1,594 million for 2012).
- Net Loss of $173,000 from continuing operations after income tax which includes a deferred tax recovery of $57,000 ($1.171 million profit for 2012 which includes deferred tax recovery of $697,000).
- During the quarter, the Corporation began trials with two major oil and gas operators utilizing a new technology to recover oil, water and solids from contaminated drill cuttings. The technology uses thermal desorption to separate oil, water and solids which are then recovered, reused or disposed of. Subsequent to the quarter the trials were completed and the Corporation expects to establish a new business together with the United Kingdom based developer of the technology.
- During the quarter, the Corporation completed the acquisition of 1770245 Alberta Ltd. (which includes the assets of Tippin D Oilfield Services Ltd. and 40 Creek Oilfield Services Ltd.) for a purchase price of $1.8 million. The acquired company provides a combination of vacuum, hydrovac and boiler truck services to the completions and productions sectors of the oil and gas industry in the Peace area of Northwestern Alberta. Subsequent to the acquisition, the Corporation acquired additional equipment to expand the services being offered in the area.
- Total capital expenditures during the quarter (excluding the acquisition above) amounted to $1,523,000 for trucks and equipment to meet the current demand for winter drilling work and to update its fleet of vacuum and water trucks to tri-drive units.
- The Corporation's trial of the new thermal desorption technology was concluded subsequent to the quarter. One trial was carried out for a major oilsands operator in the Fort McMurray region of Alberta treating bitumen and a second trial was carried out for a major operator in Northeastern British Columbia treating oil based drilling waste. The Corporation expects to establish a new exclusive company with the United Kingdom based technology developer to adapt the system to the Canadian climate and to provide services to allow the recovery of oil, the recycling of water and the separation of the solids. In addition to the financial benefits of the oil recovery and water recycling, the technology also dramatically reduces the amount of waste going to landfill.
OUTLOOK AND STRATEGY
While the first two months of the last quarter were slower than usual in the drilling related services, activity has recently picked up and the Corporation looks forward to a more active third quarter.
The Corporation continues to expand its areas of operation and also continues to expand and upgrade its fleet of trucks and its equipment. The Corporation will continue to pursue new acquisitions to both complement and diversify its areas of operation and the services it can provide to the oil and gas exploration and production industry.
The Corporation operates in the oilfield service industry in Canada through two wholly owned subsidiaries - BearStone Environmental Solutions Inc. and Porterco Oilfield Services Inc. BearStone provides environmental services to the upstream oil and gas industry and also operates a fleet of specialized vacuum, hydrovac and water trucks. Porterco operates a fleet of trucks and trailers for hauling oil contaminated drill cuttings as well as providing equipment rental and custom fabrication services.
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