Independence-based Covia Corp. (NYSE: CVIA), a minerals and materials supplier for industrial and energy markets, on Tuesday, April 14, announced that it's cutting staff and implementing other initiatives designed to reduce overhead expenses by about $25 million from 2019 levels.
The cuts are among a series of actions that Covia said in a news release are designed to "strengthen safety protocols, reduce capacity and lower costs" as a result of "challenges caused by the COVID-19 pandemic and recent dislocations in global oil markets."
A Covia official did not immediately respond to an email on Tuesday morning seeking details about the staffing reductions and reduction in overhead expenses.
Covia said in the release that it also has taken the following steps:
• Eliminated nonessential travel and facilitated work-from-home arrangements.
• Reduced active energy capacity by nearly 30%, or 6 million tons annually, including the idling of facilities in Utica, Ill., and Kermit, Texas.
• Reduced the expected 2020 capital expenditure program "approximately 50%" compared with 2019.
• Closed on a new, three-year credit facility with availability up to $75 million secured by some of the company's accounts receivable.
• Developed and implemented "a series of guidelines and practices to improve safe operating procedures throughout the organization to mitigate the spread of COVID-19."
Richard Navarre, the chairman, president and CEO of Covia, said in a statement, "The health and safety of our employees is a top priority, and I am proud of how quickly our organization reacted to continue safe operations in light of the impact of the COVID-19 pandemic."
He added, “Unfortunately, the pandemic, combined with the collapse of oil prices, has had a negative impact on the markets we serve, forcing us to take painful but necessary steps, to adjust our operations to better align with market demand. These actions better position Covia to successfully navigate the current market without impacting our ability to meet the needs of our customers.”
Covia on March 10 reported that revenues for 2019 were $1.6 billion, a decrease of 31% compared with 2018, due mainly to lower energy volumes and pricing. The company's net loss from continuing operations in 2019 was $1.29 billion, including the negative impact of $1.4 million in noncash asset impairment charges. That compared with a net loss from continuing operations of $185.5 million in 2018.
The company's shares were trading at 47 cents as of around 4:15 p.m. Tuesday.
Covia was formed on June 1, 2018, via the merger of Fairmount Santrol and Unimin Corp. The company's stock was trading at $24.50 when markets closed on the day of the merger.
Late on Tuesday, Covia announced that it received notification on April 8 from the New York Stock Exchange that the company is no longer in compliance with NYSE continued listing standards, which require listed companies to maintain an average closing share price of $1 over a consecutive 30 trading-day period.
Covia has six months from receipt of the notice to regain compliance with the NYSE’s minimum share price requirement. The company said it "intends to actively monitor the price of its common stock and will consider all available options to regain compliance with the NYSE’s continued listing standards." Covia will notify the NYSE within 10 business days of "its intent to cure the deficiency and return to compliance with the NYSE’s continued listing standards," the company said.
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April 15, 2020 at 12:36AM
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Covia Corp. cuts staff, overhead expenses as a result of coronavirus pandemic - Crain's Cleveland Business
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