Source Energy Services Ltd. announced its 2019 financial results and achievements.
2019 was a challenging year for the oilfield services industry in the Western Canadian Sedimentary Basin (WCSB) as exploration and production companies wrestled with lower commodity prices and significant investor pressure to keep capital spending within available cash flows, resulting in substantial spending decreases on both drilling and completion activities. Despite this backdrop, some of the key achievements realized for the fourth quarter and year ended Dec. 31, 2019 were as follows:
Fourth Quarter
• Adjusted EBITDA was $9.2 million, which was $12.4 million higher than the $(3.2) million of Adjusted EBITDA loss in the three months ended Dec. 31, 2018.
• Achieved 51% growth in sand sales volume when compared with the fourth quarter of 2018.
• Recorded new daily throughput record for both Sahara and terminals which that saw Source deliver over 16,000 Mt in a single day.
• Decreased costs of sales by 4% through cost saving initiatives and operational optimization.
• Increased wellsite solutions revenue by $1.9 million, or 27%, compared to the fourth quarter of 2018, reflecting the increasing demand for Source’s full logistics services.
• Recorded an increase of 47.4 million Mt of indicated resource at the Blair facility.
Full-Year 2019
• Grew market share in the WCSB, with a 3% decline in sales into the WCSB, as opposed to an industry-wide decline in completion activities of approximately 20%.
• Distributed total volumes through Source’s WCSB terminal network of 2,325,742 Mt.
• Delivered 84% of sand volumes under contracts with customers that require reliable supply delivered at increasingly higher daily volumes.
• Renewed supply contracts with three of our major customers.
• Advanced Source’s diversification strategy, recognizing in-year revenue and entering into contracts for the 2020 year for the transloading of pipe and magnetite.
• Achieved Adjusted EBITDA of $48.6 million.
• Realized gross margin of $37.6 million and Adjusted Gross Margin of $79.7 million.
• Realized a net loss of $90.0 million or $(1.47) per share including non-cash pre-tax charges for impairment and asset write-down of $71.1 million.