Enservco Corporation Updates Investors on 2019 Fourth Quarter and Year-End Financial Expectations

DENVER, Jan. 10, 2020 (GLOBE NEWSWIRE) -- Enservco Corporation (NYSE American: ENSV), a diversified national provider of specialized well-site services to the domestic onshore conventional and unconventional oil and gas industries, today announced it expects 2019 fourth quarter revenue to be between $8.0 million and $8.1 million as compared to $13.3 million in the fourth quarter last year.  Full-year 2019 revenue is expected to be between $43.0 million and $43.1 million compared to $42.8 million in 2018.  These preliminary revenue estimates have been adjusted to reflect the discontinuation of water transfer operations in the fourth quarter of 2019.

Ian Dickinson, President and CEO, said the results reflect a sharper than anticipated decline in domestic oil and gas well completion activity and resulting pricing pressure in the fourth quarter.  He added that it is too early in the year-end close process to provide adjusted EBITDA information.

“The decline in drilling and completion activity accelerated in the fourth quarter and combined with significant pricing pressure to result in lower than expected revenue in Q4 and 2019,” said Dickinson.  “As a result, the market share gains we achieved during 2019 did not translate into improved financial results.  On a positive note, we have seen an uptick in customer activity in the first 10 days of January and, although it is still early, we are hopeful that we will achieve a meaningful increase in sequential quarter revenue.  Enservco provides more than 300 domestic oil and gas producers, including some of the world’s largest, with mission critical services.  We are the nation’s largest provider of frac water heating and we provide a variety of complementary services for drilling and completions as well as maintenance and support.”

In other Company news, Enservco has submitted a business plan to the NYSE American exchange that outlines the Company’s intention to regain compliance with listing standards.  In addition, as previously announced in the Company’s third quarter investor update, in October 2019 Enservco incurred $1.2 million in over advances above its $29.7 million borrowing base availability on its bank line of credit.  The over advances related to the Company ramping up to fulfill customer demand for the 2019-20 heating season.  On January 6, 2020, the bank provided Enservco with a notice of events of default and reservation of rights pertaining to the Company not having: 1) immediately repaid the over advance; 2) maintained minimum liquidity of $1.5 million for the months of October and November 2019; 3) maintained a minimum fixed charge coverage ratio of 1.1 to 1.0 for the months of October and November 2019.  The bank has elected not to exercise, but has not waived, its right to immediate payment of this over advance and Enservco continues to work with the bank in seeking to resolve this issue.