Precision Drilling Corp. announced net revenues of $31 million in the third quarter of the year, as customer demand helped the oilfield service company return to profitability for the first time since 2019.
The Calgary-based company generated net earnings of $2.26 per share for the three months ended Sept. 30, compared with a net loss of $38 million in the third quarter of 2021, or $2.86 per share, the company said in a released on Thursday.
“I am very pleased to see Precision’s financial performance return to profitability as the recovery in customer demand continues to strengthen and now spans all geographies and the services we provide,” chief executive Kevin Neveu said in a statement.
“With strong demand for our services, tight rig supply and pricing momentum at top day rates, we expect fleet average day rates and operating margins to continue to trend upward until 2023.”
Precision reported earnings increases due to a 27 percent increase in North American drilling activity in the third quarter of 2021.
The company reported an average of 57 active drilling rigs in the US during the third quarter, with 61 currently operating – a 20 percent increase from the beginning of the year. In Canada, the company averaged 58 active rigs in the quarter, a 16 percent increase over the same period last year.
Precision said it is focused on reducing debt while allocating 10 to 20 percent of free cash flow toward repurchases.
The company announced earlier this month that it was awarded five-year drilling contracts in Kuwait and Saudi Arabia that will increase its active rig count in the region to eight rigs by mid-2023, representing $820 million to the contracted income.
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