Canadian equipment rental and waste management company CERF reported a net loss of CA$13.4 million (€9.5 million) for the nine months ended 30 September, compared to net income of CA$3 million (€2.1 million) a year ago, after being hit by challenging market conditions.
Revenues for the nine months were stable year-on-year at CA$37.6 million (€26.6 million). The figure was CA$37.4 million (€26.5 million) for the same period last year.
President and CEO Wayne Wadley said, “Over the past nine months, we have undertaken cost reduction initiatives which included reducing personnel in our Energy Services Division by 47%. We will continue to review the cost side of our business and focus on initiatives that allow us to maintain flexibility in the current environment.”
The company said significant decreases in industry activity in the third quarter resulting from the decline in oil and natural gas prices and its impact on CERF’s oilfield rentals business resulted in a one-time impairment provision of CA$12.5 million (€8.9 million).
The company said the oil and gas industry has faced substantial changes in the last 12 months due to the severe decline in crude oil prices. CERF said it expected to see further pricing pressure in its rental business in the fourth quarter and the first three months of 2016.
“In the near term, we anticipate activity to remain significantly below the fourth quarter of 2014 levels, as customers fulfil their 2015 capital spending commitments and look to trim capital spending further heading into 2016. With our cost reductions, we can continue to be competitive in this sector,” the company said.
CERF said its Industrial Rentals business had seen rental revenues flatten, as competition remained strong in the Edmonton market. However, it said its 4-Way Equipment Rentals brand had successfully introduced a new aerial equipment category in the third quarter in response to customer demand.
“Although early, we are already seeing encouraging results from our new initiative. With the winter construction season upon us, our heating equipment is starting to make its way out to job sites.
"Our larger natural gas/propane heaters are ahead of last year’s utilisation rate, which bodes well for early season activity,” the company added.