OREANDA-NEWS.  NOW Inc. (NYSE: DNOW) reported for its fourth quarter ended December 31, 2015 a net loss of $249 million, or $2.33 per fully diluted share, compared to net income of $16 million, or $0.14 per fully diluted share in the same period of 2014. Excluding other costs, net loss was $27 million or $0.25 per fully diluted share. Other costs in the fourth quarter of 2015 included a pre-tax non-cash impairment charge of $138 million associated with the fair value of goodwill, $3 million in acquisition-related and severance charges and an after-tax charge of $129 million related to a deferred tax asset valuation allowance.

Also included in the fourth quarter ended December 31, 2015 results, but not characterized as other costs, was a pre-tax charge of $5 million approximating $0.02 per fully diluted share, for high steel content inventory cost adjustments, related to falling steel prices.

The Company’s revenues for the fourth quarter of 2015 were $644 million, a decrease of 14 percent from the third quarter of 2015.

Robert Workman, President and CEO of NOW Inc., remarked “During the fourth quarter we continued to see unprecedented declines in drilling activity in North America and abroad. As long as rig count declines and drilled but uncompleted wells accumulate, our performance will be negatively impacted.

“In the meantime, we generated $80 million in cash flow from operating activities in the fourth quarter of 2015 and $324 million during the full year of 2015. We reduced receivables by $366 million and inventory by $256 million during 2015, despite additions from acquisitions. We continue to see benefits from our product line investments and we are pursuing other opportunities in the same vein. Despite a depressed environment, our mission is simple: focus on the long term, generate cash, align our cost structure with sales and gain market share.”

United States

Fourth quarter revenues for the United States were $433 million, down 13 percent from the third quarter of 2015. Sequential revenues were buoyed by $17 million in added sales from the Odessa Pumps, Challenger and Updike acquisitions, but five percent fewer billings days, budgetary voids and the seasonal lull diminished these gains. Revenues decreased 36 percent from the fourth quarter of 2014, or 45 percent when ignoring the favorable impact of acquisitions, outperforming the U.S. rig count decline, where rig counts buckled 60 percent in the same period.

Canada

Canada revenues for the fourth quarter of 2015 were $79 million, down 16 percent compared to the third quarter of 2015 and down 56 percent from the fourth quarter of 2014. The early shut down of projects, a bearish sentiment and rig activity deteriorating by 57 percent from the fourth quarter of 2014 drove spending declines. Canada outperformed the rig count decline and overcame a 14 percent foreign exchange disadvantage from the fourth quarter of 2014 to the fourth quarter of 2015.

International

International operations generated fourth quarter revenues of $132 million, which were down 19 percent from the third quarter of 2015 and down 10 percent from the fourth quarter of 2014. Additional revenues provided by acquisitions were overwhelmed by decreased international rig activity, where we have a heavier customer concentration of offshore drilling contractors.