Major Drilling finds some stability in 2Q
Major Drilling posted relatively stable quarterly revenue of $84.7 million in Q2, down 3% from the $87.2 million recorded for the same quarter last year.
“We continued to see some stability in our activity levels this quarter. This stability in our ongoing contracts in the last few quarters has allowed us to optimize productivity and costs, which is reflected in this quarter’s margins,” said Denis Larocque, President and CEO of Major Drilling.
“Although volume and pricing are still not at profitable levels, we are generating cash while still investing in our equipment and training, which is key in our plan to be ready for the next upturn.”
With exploration work down, Major Drilling has changed focus.
“Our customers continue to focus their work almost exclusively on mine sites, which means they have a much greater focus on production related drilling, such as percussive and underground drilling, which has lower margins. We are continuing to adapt to the current market conditions by investing in and growing our percussive operations.”
Other highlights from the quarter.
- Gross margin percentage for the quarter was 27.5%, compared to 23.8% for the corresponding period last year.
- EBITDA increased 30% to $10.9 million compared to $8.4 million for the prior year quarter.
- Net cash increased $0.2 million to $33.1 million during the quarter. Capital expenditures for the quarter were $6.5 million.
- Net loss was $5.3 million or $0.07 per share ($0.07 per share diluted) for the quarter, compared to a net loss of $10.1 million or $0.13 per share ($0.13 per share diluted) for the prior year quarter.