Oilfield products distributor and energy services provider NOW Inc. reported its 2020 fourth quarter and full year financial results on Wednesday, recapping a transformational year for a company that downsized its business by essentially half.
Given that significant downsizing during the year, it's much more useful to emphasize the company's sequential quarterly results than year-over-year.
Houston-based NOW, which does business primarily as DistributionNOW, reported Q4 sales of $319 million, down from $326 million in Q3 and $370 million in Q2. Before dramatically reducing its physical footprint, DNOW's Q4 2019 sales were $639 million. As for US revenue, the company said US energy comprised 81 percent of Q4 sales, with US Process Solutions contributing 19 percent.
The company took an operating loss of $37 million in Q4, compared to a $21 million loss in Q3 and $29 million loss in Q2. Total Q4 net loss was $44 million, following a $22 million loss in Q3 and $30 million loss in Q2. The company has zero debt.
The figure that perhaps best exemplifies the new-look DNOW is full-year sales, where 2020's sales $1.62 billion were a little more than half of 2019's $2.95 billion. As part of its restructuring during 2020, DNOW reduced its headcount from 4,400 to 2,500 throughout the year.
NOW Inc. was No. 10 on Industrial Distribution's 2020 Big 50 List on account of its $2.95 billion in 2019 sales, but the company will likely now end up charting around No. 13-15 on the 2021 Big 50.
In its Q2 earnings release back in early August 2020, DNOW said it was offshoring lower-level back office labor as the company deploys technology to augment labor content. DNOW has rolled out a new order management system that is said to be more efficient in the quote-to-order process, yielding higher employee productivity.