MRC Global posts 20 percent sales drop
MRC Global reported sales were $1.198 billion for the second quarter of 2015, which were 20% lower than the second quarter of 2014.
The decline was driven primarily by reduced activity in the upstream sector. Sales were also negatively impacted by the strengthening of the U.S. dollar, which reduced reported sales by $40.8 million. Net income for the second quarter of 2015 was $15.0 million, or 15 cents per diluted share, compared to $39.3 million, or 38 cents, for the second quarter of 2014.
"The second quarter results reflect the impact of the unfavorable commodity environment and related decline in our customers' activity. We have taken actions to reduce our costs, lower our working capital levels and pay down our debt, the impact of which is reflected in our results," said Andrew R. Lane, MRC Global's chairman, president and chief executive officer.
U.S. sales in the second quarter of 2015 were $956.3 million, down 14.3% from the same quarter in 2014. The decrease was attributable to reduced customer spending in the upstream sector. From the first quarter of 2015, U.S. sales declined only 2% as compared to a 35% decline in average U.S. rig count over the same period reflecting market share gains, growth in the midstream sector and a modest decline in the downstream sector.
Canadian sales in the second quarter of 2015 were $77.6 million, down 48.3% from the same quarter in 2014. The decrease in Canadian sales reflected a $65 million decrease in the upstream business due to a decline in customer spending. Sales were negatively impacted by $9.9 million as a result of the stronger U.S. dollar.
International sales in the second quarter of 2015 were $164.2 million, a decrease of 29.1% from the same period in 2014. The decrease was due primarily to less customer spending in the U.K., Norway and Australia, partially offset by acquisitions, which added $10.5 million. Sales were negatively impacted by $30.9 million due to the strengthening of the U.S. dollar.
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