Boart Longyear said it is expecting to be better-positioned for success and improved financial performance when market conditions improve, even though challenging conditions in the mining markets continue to put pressure on its industry as reflected in the company’s 2014 financial performance.
The company said in a recent press release that its now-completed recapitalization, led by its largest investor, Centerbridge Partners L.P., strengthens its balance sheet, providing substantially enhanced liquidity and improving the company’s financial flexibility to support current operations and execute its strategy for long-term growth.
“Despite the challenges we faced in 2014 from continued reductions in the demand for our services and products, we enter 2015 in a stronger and healthier position than when we communicated with shareholders at this time last year,” said Richard O’Brien, president and CEO. “As a result of the recapitalization, we no longer face the uncertainty related to our potential inability to refinance our debt. We are also much better positioned as a result of substantial and sustainable cost reductions to provide increased earnings and cash flow when our markets recover.”
He added, “Our markets will improve, and, when they do, we expect to be much better positioned to deliver improved profit margins and cash generation. Our disciplined approach to cost control and a greater emphasis on capital efficiency will allow us to sustainably operate our business at lower SG&A and capital costs than the company achieved in the 2010 through 2012 market upcycle.”
In the near term, he said, “We will focus on opportunities to increase efficiencies and maintain pricing discipline in our drilling services business, delivering more customer-driven designs from our products business, continuing to deliver benefits from our combined platforms for supply chain, inventory management and maintenance services and carefully examining our capital deployment and related strategies.”
The Utah, USA-based company intends to introduce several new products in 2015, including the LS250 MiniSonic, a compact sonic rig suited for a range of environmental and infrastructure drilling applications, including difficult-to-reach drill sites; and additions to its range of rod handlers and rod presenters, including retrofit options for some of its most popular surface rigs.