Season’s Greetings and Year-End Wrap Up

Posted by Jeff Foster - Cimarron Energy CEO on 12/19/2017

 

 

CEO Year end Review

Dear Cimarron Family,

2017 was a demanding year for our industry and Cimarron.  While tackling several challenges, Cimarron achieved significant progress toward our strategic goals. Over the past 12 months, we continued to advance all functions of our business while maintaining our exceptional standard of safety and improving quality!

 As we close out the year and move forward into 2018, let’s review some of the main achievements from the year:

 1.  Partner – We are blessed to have partners who understand our business, believe in our strategy and secured the Company’s balance sheet for long term success. Turnbridge Capital (TCP) supported the company technically, operationally and financially all year.

2.  STRIVE- We worked together to preserve our core values (safety, teamwork, respect, integrity, value, and excellence) every day. Each value is equally important as we mature as a company and one great example of teamwork and respect is the amazing support shown to those impacted by Hurricane Harvey. Just as the strength of the team is each individual member, the strength of each member is the team.

a.  The creativity of our employees provided the image of our STRIVE campaign, the winner for best banner was Taran Wagner, and for best Hard Stickers was Jeremiah Campbell. S.T.R.I.V.E. 500 plus days of Zero Incident

3.   Safety - Through November, we continue to work safely with a Total Recordable Incident Rate (TRIR) <1.0, with no lost time incidents; which is top tier performance for all oilfield service companies.

a.  Our success can be attributed to the collective efforts of our entire team. Instilling our safety culture and empowering each employee with the tools and training required to work as safety leaders continues to pay dividends as we strive for “ZERO” every day. The pursuit of achieving “ZERO” remains at the forefront as we continue to embed and grow our safety culture throughout our workforce.

b.  The following locations worked without an incident

i.  Marlow - celebrated two years

ii.  Katy and Englewood - since the acquisition (>700 days)

iii.  Field Service - last two calendar years

4.  Quality - With increasing focus on quality to mirror our safety culture, the Company instituted a quick response notification (QRN) that it is a program developed to enhance the awareness and urgency of corrective actions which is making an immediate impact to business.

5.  Sales and Operations – With a strong sales and operations team, and better market conditions, Cimarron increased sales 60% compared to last year.

a.  A quarter of the sales were generated from new customers, or new products from existing customers.

So, we are expanding our market share. Additionally, the self-quote tool is in place, which allows our sales team to provide customer proposals within minutes for standard products and win more jobs for our shops.

b.  The manufacturing plants were audited, and passed, by Oxy, Devon, Chesapeake, etc. which enabled new orders based on quality reviews.

c.   Katy plant achieved ISO 9001 Re-Certification in an extensive audit.

d.  A new field service operation was opened in Odessa, expanding our growth in West Texas.

6.   Environmental - We advanced one our strategic objectives by growing environmental Quad-O Solutions.

a.  ARControl system is in full production with more than 600 systems currently operating across the US.

Certification will be complete by Q1 2018 enabling us to expand our market presence on heated production equipment and Dehy units.

b.  We continued the focus on new technology such as removing methane emissions from pneumatic devices on production equipment, higher capacity enclosed combustors, etc. We are exploring the automation of environmental equipment, which could form a model for expanded automation across the well pad.

c.   Customers have shown increasing interest in our product to eliminate hazardous emissions from glycol dehydration regenerators and they have found that BTEX units with combustors are an excellent option to achieve it. The demand of these units is increasing significantly, and we expect to double sales next year.

7.   Finance – At the beginning of the year, the finance team was largely made up of consultants and contract

employees. The team is now staffed with full time / permanent employees, and focused on reducing the time to close the books monthly (now at four days), and improve the quality of reporting so that management can better assess performance and make quicker decisions with more confidence.

8.  IT - We completed major improvements in the system’s infrastructure including increased network speed at most of our sites, cloud based email service, Skype for business meetings, and Microsoft application for all

users. Various enhancements in the SyteLine system include elimination of manual processes such as

Shipping and Quotes, improved MRP setup for materials planning, and scheduling workbenches to enhance production planning.

9.  HR – The organization committed to more training and leadership development, kiosks were added to provide employees quicker access to train and the Company improved benefits including 401K match with little to no increase in cost to employees.

10. Execution  -    Cimarron used High Impact Teams (HIT) to continue its focus on improving key areas of business, such as time to enter customer orders into SyteLine, manufacturing organization for better efficiency and forecasting. In addition, we are actively working to improve engineering on time delivery, bill of material accuracy, inventory optimization, further optimization of processes, and cost reduction for manufactured products.

 Success is empty if you arrive at the finish line alone. The best reward is to get there surrounded by winners”

Howard Schultz, Chairman of Starbucks

 

As the year comes to an end, we celebrate the successes we’ve had as a company and are excited to continue the journey - which is a reflection of you. We appreciate the hard work, sacrifices and support from your families. Cimarron stands firm on these accomplishments, which serves as a strong foundation in this challenging commodity-price environment.

Looking  forward  to  2018,  we  will  focus  on  execution  with  consistent  quality  that  mirrors  our  safety culture.  Cimarron Leadership is thankful for having each one of you walking with us, to overcome the challenges and make everyday a step forward, to achieve our goal and win.  Let’s go!

 

Best regards,

 

Jeff Foster

Chief Executive Officer

Andrew Lesser

SVP Finance

Dee Singh

Director IT

Jerry Skweres

VP Engineering and

Estimation

Brian Berdusco

VP Manufacturing and Supply

Chain

Brenda Truman

VP of Health, Safety and

Environment

Jason Duncan

VP of Human Resources

 Randy Nemeth

SVP Field Service

 

  Cimarron Energy  

2017 End of the Year Celebrations