CALGARY - ClearStream Energy Services Inc. ('ClearStream' or the 'Company') (TSX: CSM) today announced its results for the three months ended March 31, 2021.

All amounts are in Canadian dollars and expressed in thousands of dollars unless otherwise noted.

'EBITDAS' and 'Adjusted EBITDAS' are not standard measures under IFRS. Please refer to the Advisory regarding Non-Standard Measures at the end of this press release for a description of these items and limitations of their use.

'We delivered a solid first quarter in 2021 as the recovery that commenced in the second half of 2020 extended into the first quarter of 2021. We continued to see our business stabilize as revenues in the first quarter were similar to the fourth quarter of 2020. However, gross profit margins improved compared to the first quarter of 2020 due to aggressive cost management to right size the organization and adapt to market demand,' said Yves Paletta, Chief Executive Officer.

'While our customers remain cautious, the continued improvement in oil and natural gas prices during the first quarter of 2021 and the rollout of vaccinations provide for a more optimistic outlook for our sector. We have seen an increase in bidding activity due to our service offerings aligning with current market needs, resulting in a strong win rate as evidenced by the $176 million of new awards and contract renewals secured during the first four months of 2021. We believe that activity levels will continue to recover in the second half of 2021,' added Mr. Paletta.

HIGHLIGHTS

Revenues for the three months ended March 31, 2021 were $82.2 million, representing a decrease of $44.6 million or 35.2% from Q1 2020 and a decrease of $2.3 million or 2.7% from Q4 2020.

Gross profit margin for the three months ended March 31, 2021 was 9.8%, as compared to 7.2% in Q1 2020 and 9.9% in Q4 2020.

Adjusted EBITDAS for the three months ended March 31, 2021 was $2.2 million, representing a decrease of $0.5 million or 16% from Q1 2020 and an increase of $0.5 million or 340% from Q4 2020.

Selling, general and administrative expenses for the three months ended March 31, 2021 were $6.0 million, representing a decrease of $0.5 million or 8.8% from Q1 2020 and a decrease of $1.9 million or 24% from Q4 2020.

Liquidity remained strong with total cash and available credit facilities of $66.2 million at March 31, 2021, down from $71.7 million at December 31, 2020 due to a reduction in the maximum borrowing base under the asset-based lending facility effective March 23, 2021.

New project awards and contract renewals were $135 million for the three months ended March 31, 2021 and approximately $41 million for the month of April 2021. Approximately 60% of that work will be completed in 2021 with the balance scheduled for 2022-2025.

Maintenance and Construction Services

Activity levels for maintenance and construction services in the first quarter were similar to the fourth quarter of 2020, as public health measures to limit the spread of the virus remained in place. Revenues from maintenance and construction services in Q1 2021 were 4.6% lower than Q4 2020 and 35.8% lower than Q1 2020, which was largely unaffected by the pandemic.

With the continuing recovery in world oil prices combined with on-going strength in North American natural gas prices, bidding activity for new work accelerated towards the end of 2020 and has continued to be very active in 2021. We remain focused on consolidating various scopes of work with existing customers by adding additional services to enable more efficient execution and lower costs for our customers on each work site.

During the first quarter, we established a joint venture with Christina River Enterprises, the business entity of the Fort McMurray #468 First Nation, to provide heavy equipment operators in North Eastern Alberta. This joint venture will leverage the experience and strengths of both parties for mutual benefit and growth, and further position us as a leading service provider of heavy equipment operators.

Wear Technology Overlay Services

In 2020, activity levels for wear technology overlay services remained well below historical levels as customers scaled back their production output and spending on consumables in response to weak oil prices. We saw a modest increase in activity in Q1 2021 with revenues up 13.2% from Q4 2020. With the recovery in world oil prices, we are seeing customers increase their production outlook for 2021, which should result in an increase in demand for wear technology overlay services.

Environmental Services

We are actively pursuing opportunities with our customers to secure funding under the federal and provincial programs for the closure and reclamation of oil and gas wells, pipelines and facilities in British Columbia, Alberta and Saskatchewan. We expect the pace at which funding under these programs is released to accelerate in 2021. In addition, we are seeing oil and gas companies increase their own expenditures for reclamation and remediation activities.

To accelerate our turnkey asset retirement solution and better support our customers, on February 1, 2021, ClearStream re-branded its environmental services offering as Flint Environmental Services. The combination of our environmental specialists and project managers together with Flint's personnel operating through its extensive network of facilities in Western Canada, has added value to our integrated full-service offering, as evidenced by the corresponding increase in activity levels in Q1 2021 with revenues up more than 50% from Q4 2020.

About ClearStream Energy Services Inc.

With a legacy of excellence and experience stretching back more than 50 years, ClearStream provides solutions for the Energy and Industrial markets including: Oil & Gas, Petrochemical, Mining, Power, Agriculture, Forestry, Infrastructure and Water Treatment. With offices strategically located across Canada and a dedicated workforce, we provide maintenance, construction and environmental services that keep our clients moving forward.

Contact:

Randy Watt

Tel: (587) 318-0997

Email: rwatt@clearstreamenergy.ca

Advisory regarding Forward-Looking Information

Certain information included in this MD&A may constitute 'forward-looking information' within the meaning of Canadian securities laws. In some cases, forward-looking information can be identified by terminology such as 'may', 'will', 'should', 'expect', 'plan', 'anticipate', 'believe', 'estimate', 'predict', 'potential', 'continue' or the negative of these terms or other similar expressions concerning matters that are not historical facts. This press release contains forward-looking information relating to: our business plans, strategies and objectives; the effects of the COVID-19 pandemic on global commerce and oil prices; that customers will remain cautious regarding their spending plans; that activity levels will recover in the second half of 2021; contract renewals and project awards, including the estimated value thereof and the timing of completing the associated work; that the demand for wear technology overlay services will increase as customers increase production levels; that the pace at which funding under federal and provincial programs for the closure and reclamation of oil and gas wells, pipelines and facilities is released will accelerate in 2021; that the consolidation of our wear technology overlay facilities has improved our production flexibility and reduced our fixed costs; the sufficiency of our liquidity and cash flow from operations to meet our short-term contractual obligations and maintain compliance with our financial covenants through March 31, 2022; that the COVID-19 pandemic will continue to impact both the local and global economy; the duration of public health measures; that governments will start to re-open their economies as the rate of vaccinations increases; that our customers who are involved in the energy industry will begin to increase their spending and address maintenance projects that have been deferred as they realize higher cash flows from the recovery in world oil prices; that activity levels will recover in the second half of 2021 as customers prioritize asset management and integrity services to increase operational reliability; that our customers will focus on improving their operational processes and that we are well-positioned to consolidate further multiple services while generating efficiencies and cost reductions for our customers.

Forward-looking information involves significant risks and uncertainties. A number of factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking information including, but not limited to, the success of our response to the COVID-19 global pandemic, risks related to the integration of acquired businesses, conditions of capital markets, economic conditions, commodity prices, dependence on key personnel, interest rates, regulatory change, ability to meet working capital requirements and capital expenditure needs, factors relating to the weather and availability of labour. These factors should not be considered exhaustive. Risks and uncertainties about ClearStream's business are more fully discussed in ClearStream's disclosure materials, including its annual information form and management's discussion and analysis of the operating and financial results, filed with the securities regulatory authorities in Canada and available at www.sedar.com. In formulating the forward-looking information, management has assumed that business and economic conditions affecting ClearStream will continue substantially in the ordinary course, including, without limitation, with respect to general levels of economic activity, regulations, taxes and interest rates. Although the forward-looking information is based on what management of ClearStream consider to be reasonable assumptions based on information currently available to it, there can be no assurance that actual events or results will be consistent with this forward-looking information, and management's assumptions may prove to be incorrect.

This forward-looking information is made as of the date of this press release, and ClearStream does not assume any obligation to update or revise it to reflect new events or circumstances except as required by law. Undue reliance should not be placed on forward-looking information. Forward-looking information is provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes.

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