Business
Calfrac announces reductions to its 2020 capital program and reduced operating footprint
Calfrac announces reductions to its 2020 capital program and reduced operating footprint ...
About this update from Calfrac Well Services Ltd.
[{"type":"text","content":"\n\n\n\nCalfrac announces reductions to its 2020 capital program and reduced operating footprint\n\n/* Style Definitions */\nspan.prnews_span\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\na.prnews_a\n{\ncolor:blue;\n}\nli.prnews_li\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\np.prnews_p\n{\nfont-size:0.62em;\nfont-family:\"Arial\";\ncolor:black;\nmargin:0in;\n}\n\n\n\n\n\n\n\nCanada NewsWire\nCALGARY, March 27, 2020\n\n\n\nCALGARY, March 27, 2020 /CNW/ - Calfrac Well Services Ltd. (\"Calfrac\" or the \"Company\") (TSX-CFW) is announcing reductions to its 2020 capital program and North American operating footprint as a result of the rapid and unforeseen deterioration in business conditions resulting from the COVID-19 global pandemic and the oil price war among OPEC+ members. These global events have caused a significant decline in oil prices globally, resulting in reductions in the planned spending of many of Calfrac's clients.\nIn response to the reduced demand for Calfrac's services, the board of directors of Calfrac has approved a reduction of the Company's previously announced 2020 capital program of approximately $100.5 million down to approximately $55.0 million. Calfrac has also reduced the number of crews being deployed in its North American operations from 19 fleets to nine, which will result in an aggregate reduction of approximately 40% of the Company's North American workforce. \nIn addition, Calfrac's board of directors and senior management have taken the following actions to reduce the Company's fixed costs:\nReduced Calfrac's board compensation by 25%;Reduced Executive officer salaries by 10%Eliminated retirement savings matching contributions, which previously represented up to 6% of base salary;Reduced staff employee salaries by 5 – 10%;Modified work schedules to provide increased flexibility to respond to fluctuating demand for the Company's services, while reducing personnel costs;Reduced or eliminated several compensation programs and bonuses; andRestricted discretionary spending and suspended all non-emergency travel.It is difficult to predict how the COVID-19 pandemic and OPEC+ oil price war will continue to affect the demand for Calfrac's services. However, Calfrac's management and board of directors will continue to monitor and assess the evolving circumstan...