LAFAYETTE, La., Aug. 29, 2013 (GLOBE NEWSWIRE) -- ESP Resources, Inc. (OTCBB:ESPI), an oil and gas services company, provided an update on its business and operations.
David Dugas, President & CEO stated, "Our business has experienced significant changes over the past six months as we have shifted our strategy toward domestic operations and away from our costly international business development. Without any expected near-term revenue from these international endeavors, we had to significantly trim our overhead and refocus our efforts on our existing production petrochemical business. In addition, a slowdown in fracking activity by certain of our customers in and around our district office in Arkansas and their shift to other shale regions caused our completion petrochemical business to dip significantly. We are now recapturing that completion petrochemical business, but do expect it will take some time before we can see elevated levels."
Mr. Dugas went on further to state, "As we continue to refocus our sales efforts, we are making significant operational and structural changes to lay the groundwork for our future."
The Company has implemented the following operational changes during 2013:
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Operating personnel has been reduced from 55 at the start of the second quarter to 36.
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Payroll has been reduced 39% since April of this year through reductions in personnel numbers and salary adjustments of current personnel.
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Reductions in excess vehicle inventory have resulted in reductions of insurance monthly costs and vehicle carrying costs. To date we have sold 10 of the 18 vehicles that we had for sale.
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Chemical inventory has been reduced and streamlined from a turnover of six months on hand to now four months on hand resulting in decreased inventory carrying costs. This will continue in the third and fourth quarters with a goal to reduce to under three months on hand by the end of the year.
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The Company's sales efforts for the last 3 months have generated increased revenues from organic customer growth in South Texas (Victoria and Pharr districts) in the Eagleford shale trend. We plan to continue these efforts in the third and fourth quarters.
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Payroll costs have been reduced amongst senior management via salary cuts in order to share in the cost reductions being implemented company-wide.
- Sale of excess and non-performing assets and equipment began in the second quarter and will continue into the balance of 2013, resulting in reduction of monthly payments and interest expense.
The Company is implementing the following structural plans for the future including the following:
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The Company is currently working on strategic investment opportunities with a significant monetary foundation to execute a new and improved core business strategy and a rededication to core business strength and new expediential growth model.
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The Company is currently in discussion with several highly-seasoned and industry experienced executive management candidates to strengthen our operational team.
- As part of the restructuring plan, the Company has committed to the development of a sales strategy with the intentions of new sales personnel and a revised sales campaign to increase its customer base, industry exposure and increase revenue opportunities.
About www.espchem.com/">ESP Resources, Inc.:
ESP Resources, Inc. is a publicly traded oil and gas services company (OTCBB:ESPI) headquartered in The Woodlands, Texas. Through its subsidiaries, the Company manufactures, blends, distributes and markets specialty chemicals and analytical services to the oil and gas industry and also provides services for the upstream, midstream and downstream sectors of the energy industry, including new construction, major modifications to operational support for onshore and offshore production, gathering, refining facilities and pipelines designed to optimize performance and increase operators' return on investment. The Company's senior management has over 100 years of combined operating experience in the oil and gas services industry. More information is available on the Company's Website at www.espchem.com.
Legal Notice Regarding Forward-Looking Statements:
This press release contains "forward looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements in this news release that are not historical facts are forward-looking statements that are subject to risks and uncertainties. Forward-looking statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet determined and assumptions of management. Forward looking statements are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "potential", "goal", "objective", "prospective", and similar expressions or that events or conditions "will", "would", "may", "can", "could" or "should" occur. Information concerning oil or natural gas reserve estimates may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. Actual results may differ materially from those currently anticipated due to a number of factors beyond the reasonable control of the Company. It is important to note that actual outcomes and actual results could differ materially from those in such forward-looking statements.
Readers are cautioned not to place undue reliance on the forward-looking statements made in this press release. In evaluating these statements, you should consider the risks discussed, from time to time, in the reports we file with the U.S. Securities & Exchange Commission. For a discussion of some of the risks and important factors that could affect the Company's future results and financial condition, see the Company's Form 10-Ks and 10-Qs on file with the U.S. Securities & Exchange Commission.