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Key Energy sees Q1 EBITDA margins 200-250 bps lower than Q4

Published 03/27/2018, 12:36 PM
© Reuters.  Key Energy sees Q1 EBITDA margins 200-250 bps lower than Q4
  • Key Energy Services (KEG -1.9%) is lower after saying it expects Q1 adjusted EBITDA margin to come in 200-250 bps lower than Q4 due to the impact of employment taxes, along with additional start-up costs and inefficiencies during the first two months of the quarter.
  • KEG believes adjusted EBITDA margins in Q2 will recover to the high single- or low double-digits, driven by realized price increases in Q1 and a reduction in start-up inefficiencies.
  • The company sees Q1 total revenues rising by 5%-7% Q/Q, with U.S. rig services revenues 5%-7% higher and coiled tubing services revenues jumping 20%-25%.
  • KEG also plans $30M-$35M in FY 2018 capex, and expects $75M in liquidity at the end of Q1 before improving over the balance of the year.
  • Now read: Oasis Petroleum's 2018 And 2019 Outlook


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