Civeo revenue forecast lags estimate, shares slide

Mon Dec 29, 2014 5:48pm EST
 
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Dec 29 (Reuters) - Civeo Corp, a provider of oilfield accommodation services, forecast revenue for the first quarter and full year much below average analyst estimate, pulling down the company's shares by nearly 30 percent in extended trading.

Civeo also suspended its quarterly dividend and said it has cut its workforce in the United States by 45 percent and in Canada by 30 percent.

The company, which also operates in Australia, said its forecast reflected significant reduction in capital spending by major oil companies in North America.

Oil prices this year are on track for the biggest decline since 2008. The rapid decline has prompted several oil producers in Canada, including Cenovus Energy Inc, MEG Energy Corp and Athabasca Oil Corp, to cut spending.

Civeo, a subsidiary of Oil States International Inc, said it expects revenue of $160 million-$175 million for the first quarter ending March.

Analysts on average were expecting $228 million, according to Thomson Reuters I/B/E/S.

Civeo's 2015 revenue expectation of $540 million-$600 million also lagged analysts' estimate of $817.2 million.

The company said it expects 2015 capital expenditures of $75 million-$85 million, much below the $260 million-$280 million it expected to spend this year.

The company said it will pursue its plan to move to Canada that it had announced in September.

Civeo also said it may record some impairment charges.

The Houston-based company's shares have fallen nearly 64 percent since their May 19 debut through Monday's close of $8.27 on the New York Stock Exchange. (Reporting by Anet Josline Pinto in Bengaluru; Editing by Joyjeet Das)