When oil was going strong, Civeo Corporation, the firm known as the “man camp” provider including production facilities in Oklahoma, was going equally strong. But the oil price plunge combined with the coronavirus pandemic has hurt the Houston company. Its mancamps are empty and now the firm might consider a reverse stock split to ease the economic impact.
The latest impact was a New York Stock Exchange notification of noncompliance with listing standards. The company’s average closing price of common shares over a consecutive 30-day trading period had fallen below $1 a share, the minimum required after closing price to be traded on the Exchange.
In response to the letter, Bradley J. Dodson, Civeo’s President and Chief Executive Officer, stated, “The spread of COVID-19 has taken its toll on the global economy in recent weeks and, coupled with the oil price war between Saudi Arabia and Russia, has resulted in a collapse of oil prices.”
He said,”The confluence of events has created unprecedented downward pressure on energy industry stocks, particularly for small-cap companies with operations in the U.S. and Canada such as Civeo. Our shares have traded below $1.00 per share for a period of time long enough for the NYSE to issue a non-compliance notice.”
Dodson said the company’s board of directors is reviewing available alternatives to return to compliance. It has six months to regain full status at the New York Stock Exchange.
At the Company’s annual meeting of shareholders currently scheduled for May 2020, the Company’s Board of Directors intends to seek approval from shareholders that would allow Civeo to effect a reverse share split, if needed, to cure the listing standard deficiency.”
If Civeo is unable to regain compliance, the NYSE will initiate procedures to suspend and delist Civeo’s common shares.
The NYSE notification does not affect Civeo’s business operations or its Securities and Exchange Commission reporting requirements and does not result in a default under any of the Company’s material debt agreements.
Civeo has what it describes as “prominent market positions” in the Canadian oil sands and Australia, but also manufactures som of its facilities at an operation near El Reno, Oklahoma.
Civeo currently operates a total of 28 lodges and villages in Canada, Australia and the U.S., with an aggregate of approximately 30,000 rooms.
Source: Business Wire