Dawson(US:DWSN)2019-11-02 05:54Financial Data and Key Metrics Changes - For Q3 2019, the company reported revenues of $37 million, a decrease of approximately 9% compared to $40 million in Q3 2018 [8] - Net income for Q3 2019 was $2 million or $0.09 per share, compared to a net loss of $5.2 million or $0.23 per share in Q3 2018 [9] - EBITDA for Q3 2019 was $7.2 million, up from $1.7 million in Q3 2018 [9][19] - For the nine months ended September 30, 2019, revenues were $112.2 million, a decrease of 11% compared to $126.5 million in the same period of 2018 [10][20] - The company reported a net loss of $9.4 million or $0.41 per share for the nine months ended September 30, 2019, compared to a net loss of $12.6 million or $0.55 per share in the same period of 2018 [21] Business Line Data and Key Metrics Changes - Service revenues in Q3 2019 were $26 million, a decrease of 24% compared to $34.4 million in Q3 2018 [17] - General and administrative expenses were $3.8 million in Q3 2019, down 8% from $4.1 million in Q3 2018 [17] - Depreciation and amortization expense in Q3 2019 was $5.2 million, a decrease of 26.5% compared to $7.1 million in Q3 2018 [18] Market Data and Key Metrics Changes - The company operated a peak of six crews in the U.S. during Q3 2019, compared to five crews in Q2 2019 [11][15] - The company anticipates operating up to five crews in the U.S. during Q4 2019, with limited activity in Canada [12][16] Company Strategy and Development Direction - The company is focusing on reducing costs and improving productivity while operating larger channel count crews [24] - There is a shift towards a channel and energy source utilization model, which is expected to enhance operational efficiency [25] - The company is optimistic about the visibility into 2020, anticipating improved channel and source utilization [27] Management's Comments on Operating Environment and Future Outlook - Management noted that the oil and gas market remains challenging, with project delays and cancellations being common [30] - There is cautious optimism regarding future projects, with ongoing conversations with clients indicating potential opportunities [33] - The company expects high utilization of recording channels and energy source units, although the overall market remains constrained [34][59] Other Important Information - The balance sheet remains strong, with cash and short-term investments of $27.1 million and a current ratio of 2.9:1 as of September 30, 2019 [23] - Capital expenditures for Q3 2019 were $644,000, primarily for maintenance capital items [29] Q&A Session Summary Question: Market sense and project potentials - Management indicated that there have not been recent cancellations, but project delays related to land access and permitting continue to affect short-term utilization [32] Question: Geographic demand and areas of strength - The majority of future work is expected to be in the Permian area, with ongoing conversations about new data acquisition opportunities [44] Question: Equipment utilization and expansion needs - Management believes the current equipment base is in good shape, with flexibility to move channels as needed, but is open to opportunities for expansion if the market improves [51][52] Question: Canadian winter season outlook - The Canadian operations are expected to focus on heavy oil, with indications of up to four crews operating, although the channel count impact is still uncertain [55]