The following is a summary of the Independence Contract Drilling, Inc. (ICD) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Independence Contract Drilling reported an adjusted net loss of $7.2 million or $0.50 per share and adjusted EBITDA of $11.8 million in Q1 2024.

• The company operated an average of 15.1 rigs during the quarter, with a daily margin of $11,829, surpassing earlier guidance due to effective cost control.

• SG&A costs stood at $4.3 million, inclusive of around $216,000 related to stock-based and deferred compensation expenses.

• Capital expenditure payments, net of disposals, were nearly $8.2 million.

• The Q1 period concluded with the repayment of convertible notes worth $3.5 million.

Business Progress:

• With improved utilization and cost-control initiatives, the company performed better than expected in the first quarter.

• Only one operating rig now remains a 200 series rig as the company completed one more 200 to 300 series conversion which is scheduled for conversion later in 2024.

• The relocation of a working rig from Haynesville to the Permian market for a new customer showed positivity, even amidst the overall declining rig count scenario.

• Due to the Resilient Permian market showing more activity than the Haynesville market, they predict the operation of only two rigs in the Haynesville for the future.

• ICD plans a gradual increase in the rig count in the Permian in the H2 2024 and intends to exploit chances to replace underperforming competitors' rigs with lower specifications.

• There are plans to operate 13 to 14 average net rigs in the Permian, and 2 in the Haynesville in Q2 2024, leaning towards an average of 17 net rigs in H2 2024.

• A formal review process has been initiated by the Board of Directors to analyze refinancing options for convertible notes and other strategic possibilities.

More details: Independence Contract Drilling IR

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