Deep Down returns to profit
Houston-based oilfield services company Deep Down went from red to black during the first quarter of 2017 compared to the prior-year quarter boosted by increase in revenues from completed projects.
The oilfield services firm last Friday reported net income of $64,000 for the first quarter of the year compared to a net loss of $450,000 for the first quarter of 2016.
Deep Down’s revenues for the first quarter 2017 were $5.6 million compared to revenues of $4.4 million for the first quarter of last year. According to the company, the $1.2 million or 29 percent increase is primarily a result of work completed on certain large projects, as well as revenue generated for offshore work during the quarter.
Ronald E. Smith, Chief Executive Officer, stated, “The oil and gas industry has largely adapted to the new normal of lower oil prices. While there is some optimism about higher prices in the mid to long-term horizon, most companies are developing project strategies with current prices in mind.”
Smith further added: “Our strategic shift towards working primarily for operators continues to show results. These operators are increasingly realizing the cost and schedule benefits of working directly with us, by eliminating the need for equipment manufacturers, without requiring us to reduce our competitive prices. The increased costs of packaging products through the equipment manufacturers outweigh the previously envisioned benefits, especially with the increased focus on standardization and cost optimization across the industry.
“While we initially saw some prolonged engineering cycles resulting from our modified contracting and project execution strategy, we are now reaping the fruits of this strategy.”
Offshore Energy Today Staff