CALGARY, ALBERTA — (Marketwired) — 11/09/16 — Critical Control Energy Services Corp. (TSX: CCZ) today reported its financial results for the three and nine months ended September 30, 2016.
“Changes made to our business from management–s broad scale business reengineering and reorganization are becoming evident in our results, paving the way for profitable growth as industry conditions improve,” said Alykhan Mamdani, President and CEO of Critical Control. “Like many of our clients, we have addressed the adversity of depressed oil and gas prices with innovation and technology to improve efficiency, resulting in a stronger and more competitive company.
Revenue
Gross margin
Earnings and net earnings
Outlook and Guidance
The decline in energy prices has negatively impacted the Corporation–s revenue. Current industry conditions, and the resulting lack of liquidity amongst producers has led to a material drop in non-recurring revenue which is expected to continue through 2016.
These same conditions have impacted the Corporation–s recurring revenue base with bankruptcies, well shut-ins, and competitive price concessions. Notwithstanding the foregoing, the Corporation has further penetrated its client base with its software solutions and reengineered its operations to reduce costs to maintain, and in some cases grow, its margins.
The Corporation expects recurring revenue from its Services division to continue being impacted for the remainder of 2016, given the lack of well site activity. Although management has observed some formation of optimization in the Corporation–s client base, the effect on industry activity remains uncertain as prices of energy remain volatile.
The Corporation–s internal business process reengineering and reorganization, commenced in 2015, continued into 2016. The impact of these changes are evident in the Corporation–s results in Q3 2016, and are expected to improve results further in 2017. Notwithstanding the foregoing, commodity prices are unpredictable and a material change will affect profitability.
About Critical Control
Critical Control provides solutions for the collection, control and analysis of measurement and operational data related to oil and gas wells across North America. We provide services to capture the data, cloud based software to visualize and manage it and the business intelligence to make quicker and more informed operational decisions.
Contacts:
Alykhan Mamdani
President & CEO
(403) 705-7500
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