Precision Drilling Posts Wider-than-expected Q2 Loss, Revenues Miss

(RTTNews) - Precision Drilling Corp. (PDS, PD.TO) reported Thursday that its second-quarter net loss was C$57.68 million or C$0.20 per share, wider than last year's net loss of C$29.82 million or C$0.10 per share.

On average, 17 analysts polled by Thomson Reuters expected loss of C$0.18 per share for the quarter. Analysts' estimates typically exclude special items.

For the quarter, earnings before income taxes, finance charges, foreign exchange, and depreciation and amortization was C$22 million, 75% lower than the second quarter of 2015. Activity for the quarter, as measured by drilling rig utilization days, decreased 48% in Canada, 58% in the U.S. and 44% internationally.

Adjusted EBITDA margin was 14%, compared to 26% a year ago, mainly due to decreased activity in all of businesses and lower spot market pricing.

Revenue this quarter was C$163.98 million, down 51% from C$334.46 million last year, mainly due to lower activity from North American operations. Analysts were looking for revenues of C$171.08 million.

Revenue from Contract Drilling Services and Completion and Production Services segments decreased over last year by 51% and 53%, respectively.

Kevin Neveu, President and Chief Executive Officer, stated, "Precision's second quarter results were adversely affected by weak customer demand and seasonally low Canadian spring break-up activity levels. During the quarter, North American oil and gas companies demonstrated a near instantaneous reaction to the low commodity prices experienced earlier this year by slashing spending, which resulted in the lowest drilling activity levels in decades."