Frank’s International, the 77-year-old oilfield services company founded in Lafayette, announced Tuesday that it will lay off 400 to 600 workers because of declining oil prices and falling rig counts. The company, which is headquartered in Houston and employs more than 4,500 workers worldwide, did not say how the layoffs might impact Lafayette-area employment.Frank's is among the largest global providers of highly engineered tubular services to the oil and gas industry, offering its services to exploration and production companies working offshore and onshore. The company's niche is complex and technically demanding wells.
That work is closely tied to oil prices, which have lost half their value since mid-2014. Last week’s uptick in prices — West Texas Intermediate rose from about $46 per barrel to $52 on news Saudi Arabia would begin bombing Houthi rebels in Yemen — appears to have been temporary, as WTI closed at $47.40 Monday and slipped another 2 percent Tuesday.
“At this time we have no other information to provide that wasn’t included in the statement,” Josh Grodin, Frank’s International's director of communications and public relations, tells ABiz.
The company made the following announcement late Tuesday afternoon:
Frank’s International’s management team has been developing and implementing cost savings opportunities while continuing to focus on our strategic growth plan. As with other oil service companies, Frank’s has also been impacted by the sudden and dramatic drop in energy prices and rig count that we have seen over the last 7-8 months. In association with these cost savings opportunities and as part of our performance improvement plan, we announced today a workforce reduction that we expect will reduce our workforce by approximately 400-600 employees in areas and functions where we are experiencing the sharpest decline in activity levels.
In the statement, Frank’s says it will discuss the specific actions, anticipated savings and other cost saving measures on its first quarter 2015 earnings call in late April. The company's common stock is traded on the NYSE under the symbol “FI.”
Word of the layoffs comes a little more than two weeks after Frank’s announced it was buying Lafayette-based Timco in a transaction valued at $95 million. That deal is expected to close in the second quarter of this year.