“We have direct requests from customers for additional equipment and a waitlist for our new coiled tubing units, which we expect the first to be deployed in June. We believe demand will continue to trend upward and, as a result, expect high utilization and positive operating margins for the remainder of 2012,” said Mr. Crisp.
Business Segment Results
Well Servicing Segment
In the first quarter of 2012, Well Servicing segment revenues from U.S. Operations increased $1.2 million, or 2.4%, to $52.2 million compared to $51.0 million in the fourth quarter of 2011, and $36.4 million in the prior year quarter. Segment gross profit totaled $13.2 million, or 25.2% of revenues, in the first quarter of 2012 compared to $12.5 million, or 24.4% of revenues, for the fourth quarter of 2011, and $6.7 million, or 18.3% of revenues, in the prior year quarter. The sequential and year-over-year increase in the Well Servicing segment revenues and gross profit is the result of higher prices for the Company’s services and greater utilization, partially offset by rising labor and fuel costs.The Company recorded approximately 117,633 U.S. rig hours for the first quarter of 2012, compared to 112,044 U.S. rig hours in the fourth quarter of 2011, and 89,615 U.S. rig hours in the first quarter of 2011. The Company had 160 rigs in its U.S. well service fleet at March 31, 2012. Capital expenditures for U.S. Operations in the Well Servicing segment for the quarter ended March 31, 2012, were approximately $10.7 million comprised of $2.8 million for two pump-down units, $2.5 million for light trucks, $1.5 million for a well service rig, and the balance for mud pumps and related well service equipment. As of March 31, 2012 the Company had 160 well service rigs and four pump-down units. Fluid Logistics and Other Segment In the first quarter of 2012, Fluid Logistics and Other segment revenues increased $5.7 million, or 7.8%, to $79.2 million compared to $73.5 million in the fourth quarter of 2011, and $58.2 million in the first quarter of 2011. Gross operating profit for the Fluid Logistics and Other segment totaled $24.4 million, or 30.8% of revenues, in the first quarter of 2012 compared to $22.5 million, or 30.6% of revenues, in the fourth quarter of 2011, and $16.0 million, or 27.5% of revenues, in the prior year quarter. Similar to our Well Servicing segment, the year-over-year increase is the result of higher prices for the Company’s services, partially offset by rising labor, repairs and fuel costs.
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