The following is a summary of the Precision Drilling Corporation (PDS) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Precision Drilling reported Q1 adjusted EBITDA of $143 million driven by strong drilling activity, improved pricing, and strict cost control.

• Net earnings were $37 million or $2.53 per share, marking the seventh quarter of positive earnings.

• Funds provided from operations amounted to $118 million, while cash provided by operations was $66 million.

• Capital expenditure totaled $56 million, of which $14 million was for upgrade and expansion and $41 million was for maintenance and infrastructure.

• Increased margins were witnessed in the U.S. and Canada due to better-than-anticipated pricing, higher ancillary revenues, and improved cost performance.

Business Progress:

• In Q1, Precision Drilling averaged 38 rigs in the U.S. (a decrease of 7 rigs from the previous quarter) and 73 rigs in Canada (an increase of 4 rigs from Q1 2023).

• Acquisition of CWC facilitated $16 million of the projected $20 million annual synergies.

• Precision Drilling plans to cut debt by $600 million between 2022 and 2026 and targeting a normalized leverage level of below 1x.

• They aim to repurchase $10 million of shares in 2024, double the pace of the previous year, and aims to return 25%-35% of free cash flow to shareholders this year.

• A progression in automation technology is underway, with imminent North American adoption, especially in safety and predictability-focused areas.

• The company maintains an optimistic outlook for the Canadian market, with strong demand for Super Triple rigs and potential for increased activity in heavy oil basins due to oil price improvements.

More details: Precision Drilling IR

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