A publicly traded, Colorado based, national provider of oil field services derived a material portion of its revenue from services used in the drilling and completion of new oil & gas wells. It also provided other remedial services necessary in the production of existing oil & gas wells.
As a result of severe commodity price declines, that reduced oil & natural gas well completions by 51% in Q4 and 35% year-over-year 2015 vs. 2014, the bank was concerned the company would experience a liquidity crisis due to full utilization of its $40MM revolver.
Performed an expedited assessment on the viability of the company.
Over a weekend, a rapid response team was rallied with oil & gas services, operations and financial acumen to perform the assessment.
Public information was reviewed, contact with the company was established and information requests were issued.
Collaborative informational calls were held with the company’s financial principals.
Developed factual, relevant analytical data across business lines reflecting both company cost improvements, lapses in financial management, e.g., non-recognition of troubling customer A/R concentrations, and identified hard asset security concerns.
Within 10 days, an informational presentation deck providing the lender with current statistics on borrowing base availability, A/R and the company’s overall operational sustainability was presented to and accepted by the bank’s leadership.