New West Energy Services Inc.
TSX VENTURE : NWE

New West Energy Services Inc.

March 28, 2014 18:24 ET

New West Energy Services Inc. Announces Its Third Quarter Results

CALGARY, ALBERTA--(Marketwired - March 28, 2014) - New West Energy Services Inc. (TSX VENTURE:NWE) (the "Corporation") is pleased to announce the financial results for the Corporation for its third quarter ended January 31, 2014.

HIGHLIGHTS

Operational and Financial Results for the third quarters ended January 31, 2014 and 2013:

  • Revenue of $6.377 million ($5.670 million for 2013).
  • Gross margin of $1.444 million ($1.549 million for 2013).
  • Net profit of $83,000 from continuing operations after income tax which includes a deferred tax provision of $27,000 ($297,000 profit for 2013 which includes a deferred tax provision of $99,000).
  • New diversified service created from the acquisition of 1770245 Alberta Ltd. in October 2013 which operated near full capacity and generated $1.3 million in revenue and $226,000 in earnings.
  • During the quarter, the Corporation completed 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. The Corporation is currently in discussions with a gas producer operating in Northeast British Columbia to build a customized unit for Western Canada and expects to establish a new business with the United Kingdom based developer of the technology following a successful contract being awarded. The Corporation has incurred net expenditures of $320,581 to date for the trial which have been expensed.

Company Developments:

  • The Corporation increased productive capacity and updated the equipment fleet during the quarter with the addition of 11 units made up of tri drive straight vac and water trucks, hydrovac, combination vac and steamer units. The overall equipment fleet currently stands at 41 units.
  • Total capital expenditures during the quarter amounted to $990,000 for trucks and equipment to meet the current demand for winter drilling work. A total of $2.8 million has been spent for trucks and equipment during the past nine months.

OUTLOOK AND STRATEGY

The Corporation is implementing its diversification strategy for services and equipment upon completion of this fiscal year end which is expected to increase revenues and margins and reduce the fluctuations in equipment utilization between the summer and winter seasons. As part of this process, the Corporation plans on diversifying its equipment fleet from drilling related services to production type services to offset the swings in drilling utilization.

OVERVIEW

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.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

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