Sluggish activity in the Canadian oilpatch was countered by a busy drilling year in Papua New Guinea to leave High Arctic Energy Services Inc. (TSX: HWO) with a net loss of $39.6 million for 2008.
This equated to a loss of 93 cents a share, but was an improvement on the $69.6 million lost in 2007. However, the 2007 figure included significant charges and writedowns.
The Red Deer-based company’s 2008 revenues were $168.5 million, up 30 per cent from the $130.1 generated the previous year. Operations in Papua New Guinea accounted for $91.7 million of last year’s revenues, as compared with $32.1 million in 2007, when High Arctic was active in the West Pacific country for only part of the year.
Revenues from Canadian operations fell $10.8 million, to $53.8 million, last year.
A news release issued by High Arctic said global economic conditions have hurt oil and gas prices, and consequently demand for the company’s services. This situation is expected to continue in 2009, it said, especially in Canada.
“The industry is facing significant headwinds for 2009 and High Arctic is taking proactive steps to reduce its costs to remain competitive,” said Michael Binnion, chairman of the company’s board of directors.
Last year, High Arctic sold more than $29 million in equipment and reduced its debt by $32.5 million. And earlier this month it announced that it had laid off more than 30 office and shop staff, and asked other employees to take pay cuts.
High Arctic provides specialized oilfield equipment and services. It has operations in Alberta, British Columbia and the Northwest Territories, and internationally is active in Asia and Mexico.