CERF Inc., which owns equipment rental and energy services firms, has approved its initial 2015 capital budget of CDN $7.3 million (about U.S. $5.8 million), a 65-percent reduction from 2014’s budget after normalizing the recently acquired Winalta Inc. operations for a full year. CERF intends to finance its 2015 capital expenditure budget from operating cash flows.
“In this low oil price environment and the resulting oilfield slowdown, we have set a conservative capital budget for 2015,” said Wayne Wadley, president and CEO. “CERF’s two divisions, Industrials and Energy Services, provide diversified revenue sources from different industries and sectors. As 2015 progresses, we will monitor both industries’ activity and may adjust the capital program as market conditions improve.”
CERF’s 2015 capital budget represents a small portion of its free cash flow, with about $3 million of the $7.3 million capital budget being allocated to growth activities, allowing the company to protect its balance sheet while maintaining service levels for its customers.
CERF’s Industrials division is engaged in the rental of industrial and construction equipment and waste management, and includes Edmonton-based 4-Way Equipment Rentals. The Energy Services division includes rental of surface equipment, downhole equipment and accommodations to the Western Canadian oil and gas industry.
