Texas oil drill bit
manufacturer taps into a $1 million receivable factoring credit line.
Due to recent
increased activity in oil and gas exploration, oil drill bit
manufacturers and related service providers may find themselves with
cash flow shortages.
El Paso, TX, Jan 31, 2006 – 1st Commercial Credit provides a Texas oil
drill bit manufacturer with a $1 million receivable factoring line of
credit. This company can now be fluid in capital as it prepares to
double sales in the next 90 days. Due to the credit worthiness of its
account debtor (the customer buying the manufacturer’s drill bits), $1
million in receivable financing was authorized. Prior to this, the
company (self-financed since it’s inception in mid-2004) had steadily
outpaced its equity and could no longer sustain positive cash flow for
future growth.
According to a January 27, 2006 report in the Oil and Gas Journal, US
drilling continued to climb to a total of 1,487 rotary rigs (up from
1,256 this time last year). The State of Texas alone had a total of 667
rotary gigs (up from 540 from a year ago).
Many service providers and suppliers in the oil and gas industry are
experiencing their own cash flow shortages due to this increase in
sales, combined with 45 to 60 days required for collections. These
suppliers may show uneven sales patterns on their income statements - a
trend that will usually eliminate banks as a source of financing.
1st Commercial Credit can help these suppliers by providing receivable
factoring services during uneven sales patterns and long-term collection
periods. The receivable credit line authorized is based on the credit
quality of the account debtor (customer that is billed) and not the
client (seller or supplier).
According to Raul Esqueda (President of 1st Commercial Credit): “If your
accounts receivable can generate the most working capital, consider
factoring, instead of borrowing against your receivable balances.
Factoring is fast, flexible and more affordable than you might expect,
and as your accounts receivable balances increase, so does the amount of
cash available to your company. Decisions are usually made the same day
and funding takes approximately 5 working days.”
1st Commercial Credit also provides receivable factoring services to oil
and gas exploration service providers such as seismic survey or
geophysical operators. Oil & gas field equipment suppliers (including
manufacturers of drilling fluids, drill rigs, lifts, geophysical
prospecting equipment, pipes, pumps, production tools, valves, and
wellheads) are also eligible for these factoring services.
Besides offering accounts receivable financing in the U.S., Canada, and
the UK, 1st Commercial Credit offers export trade finance to clients in
every major world market and can convert receivable finance transactions
in 17 currencies.
If
you feel that your business would benefit by setting up an account
receivable factoring program.
US and Canada Tel 1 800
450 9653
United Kingdom Tel 0 800 404 9669
1st Commercial
Credit, a
nationwide
factoring company headquartered in El Paso, Texas. Provides accounts
receivable financing in the US, Canada, and the UK; offers
export trade finance to clients in every major world
market and can convert receivable finance transactions in 17
currencies.
1st Commercial Credit is a
factoring company that provides receivable financing for all major industries, We are
always adding industries to our portfolio.
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