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Barnwell slices pay, jobs with losses hitting $3.2M


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POSTED: Thursday, August 13, 2009

Barnwell Industries Inc., the Honolulu-based oil and natural gas exploration company, has cut management salaries, eliminated positions and reduced administrative expenses.

The disclosure came yesterday as company officials announced that Barnwell had a net loss of $3.235 million, or 39 cents a year, in its third quarter, and $19.8 million, or $2.40 a share, in the nine months ending June 30. That compares with a $3.54 million net income, or 43 cents a share, in the third quarter last year, and an $8.54 million net gain, or $1.04 a share, in the first three quarters a year earlier.

Barnwell attributed this year's loss to lower oil and gas prices, and to the application of a federal rule on how the company values its oil and natural gas properties.

Company officials said the reductions in those values has no effect on Barnwell's liquidity or banking agreements.

“;The company has implemented steps to reduce general and administrative expenses by eliminating positions and instituting compensation reductions for management and staff with executive management salaries being reduced by an average of 20 percent,”; said Morton H. Kinzler, Barnwell's chairman and chief executive officer.

Company officials said out of 20 positions in Canada, four employees were laid off and one position has been left open; at its Honolulu headquarters, one position out of 12 has been left open.

“;Although the company continues to have challenges due to the ongoing global downturn in economic conditions, with the significant reductions in general and administrative expenses and the company's strong balance sheet, we believe we have taken the steps necessary to prepare the company for the current economic climate,”; Kinzler said.

Besides oil and natural gas interests, Barnwell also drills water wells in Hawaii.

The company's stock rose 2 cents to close at $4.54 a share yesterday on the American Stock Exchange.