Western Energy Services Corp. Announces Q1 2009 Results



    
    /NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE
     UNITED STATES/
    

    CALGARY, May 29 /CNW/ - Western Energy Services Corp. (WRG on the TSXV),
Calgary, Alberta is pleased to announce its results for the first quarter of
2009.
    The operational results for the quarter ended March 31, 2009 are:

    
    -   Corporate debt held by Institutional third party lenders was reduced
        by $1,108,720 or 13.2% in the quarter.

    -   In the quarter, the Company continued with its program to further
        reduce costs by cutting staff, implementing salary rollbacks, selling
        non-core assets and cutting certain administrative costs. On a go-
        forward basis monthly operating costs have been reduced by $125,300
        since the end of second quarter of 2008 and general and
        administrative ("G&A") expenses are down 27.5% from the comparable
        quarter in 2008.

    -   Quarterly revenues declined 36% from the corresponding quarter in
        2008 reflecting the bleak state of the oil and gas services sector in
        North America.

    -   Declining revenues resulted in reduced operating margins as fixed
        costs comprised a larger share of the Company's overall cost
        structure.

    -   The poor operating conditions have placed a major burden on the
        Company's liquidity position. As a consequence the Company has
        initiated discussions with its lenders with a goal of restructuring
        its debt obligations. At this time the possible outcome of those
        discussions can not be determined.
    

    The operating environment for the oil and gas services sector has
continued to deteriorate in the first part of Q2. Management's immediate focus
is to maintain cash and liquidity to ensure the Company survives this severe
downturn. Management and Board Members feel that a turnaround for the
Company's services will occur later this year. In particular it is felt that
demand for the Company's oil well remediation services should increase given
the 92% rise in the oil commodity price since the beginning of the year.
    Management will continue to focus on improving its business operations in
2009, reacting to the economic slowdown in a proactive manner that will
realize upon the Company's strength of providing services to the less cyclical
production side of the oil and gas industry. The Company expects that the
drilling aspect of the industry will continue to experience difficulties
throughout the remainder of 2009. Management believes that the Company's
market direction and focus of production optimization through stimulation
services will continue to provide a core revenue stream which the Company can
further build upon.

    
    Summary of Quarterly Results

    Three months ended       March 31,    December    September      June 30,
                                 2009     31, 2008     30, 2008         2008
                                   ($)          ($)          ($)          ($)
    -------------------------------------------------------------------------
    Revenue                 2,129,871    3,140,627    3,183,814    3,071,372

    (Loss) income before
     loss on sale,
     amortization,
     interest, and
     income taxes            (190,764)    (293,026)     237,838      (32,402)

    Loss from continuing
     operations            (1,101,360)  (1,574,438)  (2,306,405)  (1,168,489)

      Per share(1)              (0.03)       (0.11)       (0.16)       (0.08)

    Income (loss)          (1,101,360)  (1,574,438)  (2,306,405)  (1,168,489)

      Per share(1)              (0.03)       (0.11)       (0.16)       (0.08)


    Three months ended       March 31,    December    September      June 30,
                                 2008     31, 2007     30, 2007         2007
                                   ($)          ($)          ($)          ($)
    -------------------------------------------------------------------------
    Revenue                 3,336,081    3,029,342    4,142,846    2,777,477

    (Loss) income before
     loss on sale,
     amortization,
     interest, and
     income taxes             115,282     (508,497)     243,071      220,236

    Loss from continuing
     operations              (980,689)  (3,095,946)    (884,110)  (1,057,075)

      Per share(1)              (0.07)       (0.30)       (0.10)       (0.12)

    Income (loss)            (980,689)  (3,095,946)     110,870   (1,057,075)

      Per share(1)              (0.07)       (0.30)        0.01        (0.12)

    (1) Per share amounts for all periods reflect the 1 for 12 consolidation
        of shares that occurred in September 2008
    


    Forward Looking Statements

    This press release contains forward-looking statements and
forward-looking information within the meaning of applicable securities laws
and necessarily involve risks associated with the oil and gas energy services
industry, volatility of commodity prices, currency fluctuations, environmental
risks, competition from other energy services providers, delays resulting from
or inability to obtain required regulatory approvals and ability to access
sufficient capital from internal and external sources. The use of any of the
words "expect", "anticipate", "continue", "estimate", "objective", "ongoing",
"may", "will", "project", "should", "believe", "plans", "intends" and similar
expressions are intended to identify forward-looking information or
statements. More particularly and without limitation, this press release
contains forward-looking statements and information concerning the demand for
the Company's services, demand for oil remediation services, the state of the
economy and energy services business and the Company's revenue stream. The
forward-looking statements and information are based on certain key
expectations and assumptions made by Western, including assumptions concerning
the state of the economy and energy services business and its expected
direction, which expectations and assumptions management of Western believes
to be reasonable at this time. Although Western believes that the expectations
and assumptions on which such forward-looking statements and information are
based are reasonable at the date of this press release, undue reliance should
not be placed on the forward looking statements and information as Western can
give no assurance that they will prove to be correct. Since forward-looking
statements and information address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number of factors
and risks, including the failure to obtain required regulatory approvals and
others. Readers are cautioned that the foregoing list of factors is not
exhaustive. The forward-looking statements and information contained in this
press release are made as of the date hereof and Western undertakes no
obligation to update publicly or revise any forward-looking statements or
information, whether as a result of new information, future events or
otherwise, unless so required by applicable securities laws.

    
    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.
    





For further information:

For further information: Additional information relating to the Company
is filed on SEDAR at www.sedar.com. Please visit the web site: www.wesc.ca or
contact: Jim McQuarrie, President & CEO at (403) 782-0017. If you would like
to receive future information releases by email please provide your email
address to ir@wesc.ca.


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