Ensign Energy posts Q4 loss due to writedowns following oil, gas downturn

CALGARY – Ensign Energy Services Inc. (TSX:ESI) posted a $31-million loss in the fourth quarter of 2014, including $89.5 million in non-cash charges for decommissioning and writing down assets — primarily oil and gas drilling rigs.

The oilfield services company said Monday the loss for the quarter amounted to 20 cents per share compared with a profit of $26.9 million or 18 cents per share a year ago.

Operationally, the company showed year-over-year growth in the fourth quarter — which included a rapid decline in oil and gas prices starting in late November.

Revenue for the quarter totalled $602.7 million, up from $536 million in the last three months of 2013.

On an adjusted basis, Ensign said it earned $44.2 million or 29 cents per share for the quarter, up from $27.9 million or 18 cents per share a year ago.

The company said it expects lower demand and rates in 2015 from its North American customers following a dramatic decline in prices since late November, when Saudi Arabia and other OPEC producers said they wouldn’t cut output to support prices.

Ensign previously announced that it would reduce capital spending in 2015 and cut its salaries for senior executives and fees to directors. It says it also plans to address its administrative and supervisory structure to remain cost-effective.