- Precision Drilling (PDS, Financial) reported a 6% decline in Q1 2025 revenue to $496 million, down from $528 million in Q1 2024.
- Net earnings for the quarter were $34.5 million ($2.52 per share), slightly less than $36.5 million ($2.53 per share) in the previous year.
- The company reduced its 2025 capital budget from $225 million to $200 million and committed to repaying at least $100 million of debt this year.
Precision Drilling (PDS) announced its first-quarter financial results for 2025, revealing a 6% revenue decline to $496 million compared to $528 million in Q1 2024. Despite the revenue dip, the company achieved net earnings of $34.5 million ($2.52 per share), marking its 11th consecutive quarter of positive earnings, though slightly down from $36.5 million ($2.53 per share) in the prior year.
The decrease in revenue was attributed to a significant drop in U.S. drilling activity, where the rig count decreased from 38 to 30 year-over-year. Conversely, Canadian operations remained stable, with a slight increase from 73 to 74 active rigs. Internationally, the company maintained eight active rigs.
Key operational costs rose, contributing to operational challenges. Operating costs per utilization day in the U.S. increased by 9% to $23,568, reflecting the impact of higher mobilization expenses and additional rig reactivations. Canada also saw a 4% rise in operating costs per utilization day, influenced primarily by wage increases and rig reactivations.
Precision Drilling's proactive financial adjustments included reducing its 2025 capital budget by $25 million to $200 million amid heightened market volatility. The company has also implemented $10 million in annual cost reductions, including exiting its well-servicing business in North Dakota to streamline operations effectively.
With a firm commitment to debt reduction, Precision Drilling plans to repay at least $100 million of debt in 2025. They have already reduced debt by $17 million and repurchased $31 million in shares during Q1, buoyed by robust cash flow from operations amounting to $63.4 million.
The strategic positioning in the LNG sector was highlighted, with aspirations for growth in the natural gas plays in response to anticipated increased export capacities both in Canada and the U.S. This aligns with management’s focus on leveraging emerging LNG opportunities to offset drilling headwinds in the U.S.
The company’s liquidity remains strong, with nearly $550 million available, positioning Precision Drilling to navigate ongoing market uncertainties with resilience.
