Oil-field lodging company slashes jobs, curbs spending

HOUSTON – Oil-field lodgings company Civeo Corp. said it has slashed its workforce in the United States by 45 percent and in Canada by 30 percent as it prepares for weaker occupancy rates at its oil-field camps next year.

The Houston-based company had more than 4,000 employees when it spun off from oil field services firm Oil States International in June.

The announcement is the latest oil-field services layoffs in reaction to falling oil prices and anticipated oil-company budget cuts. Houston-based Hercules Offshore said it would reduce its headcount by 324 and oil field giant Halliburton said it would cut 1,000 jobs across multiple regions in the Eastern Hemisphere.

Civeo also is cutting its spending plans for 2015 to $75 million to $85 million, down from its budget this year of $260 million to $280 million, as it anticipates lower demand for lodging services. It said it may be required to record impairment charges on its assets.

The company’s shares have fallen 28 percent in after-hours trading on Monday to $5.95 on the New York Stock Exchange.

As oil companies began cutting their capital spending budgets in the fourth quarter, “we began taking steps to reduce marketed room capacity, control costs and curtail discretionary capital expenditures,” Civeo president and CEO Bradley Dodson said in a written statement.

These efforts reflect our proactive approach to improving the company’s structural efficiency, managing cash flow and maintaining our balance sheet,” Dodson said.

The company said it expects $160 million to $175 million in revenues in the first quarter of 2015. That would be down from sales of $252.8 million in the first quarter of this year.