Precision Drilling (TSE:PD) reports reduced Q3 loss, increased oilfield activity

Drilling rig contractor Precision Drilling Corporation (TSE:PD, Mkt cap 1.93B, EPS -1.49, Shares 293.24M) has reported a loss for the third quarter but expects rig bookings to improve in 2017.

The Calgary-based company announced on Friday that its net loss for the third quarter was C$47m, a decrease from the C$86.7m net loss reported for the same period last year. The loss amounted to 16 cents per share compared with 30 cents a year ago.

Revenue declined to C$202m, down 45% from $364m in the third quarter of 2015, with decreased activity in all of the company’s operations.

However, Precision Drilling’s president and CEO, Kevin Neveu, said that customer sentiment has improved as commodity prices have strengthened, supported by OPEC strategic intentions and improving supply and demand fundamentals.

“This improved outlook is evident in the conversations we are having with customers, but more importantly in our activity increases, recent contract bookings and improving pricing environment,” Neveu explained.

“During the third quarter, we gained visibility through rig commitments in both the U.S. and Canada and report seven rig years added to our 2017 contract book, bringing average rigs under contract for next year to 42.

“With 37 rigs operating in the U.S. today, our activity is up 70% from second quarter lows, while the industry increase is approximately 35%. We believe our market share increase and contract additions reflect both the desirability of Precision’s high performance Super Triple rigs and our customers’ improving outlook.”

In a further sign that oilfield activity levels are recovering, the company announced that it has brought back almost 1,000 employees.

Precision Drilling Corporation (TSE:PD) provides contract drilling, and completion and production services primarily to oil and natural gas exploration and production companies in Canada, the United States and certain international locations. It operates through two segments: Contract Drilling Services, and Completion and Production Services. The Contract Drilling Services segment includes Drilling rig operations in Canada, the United States and international, and Directional drilling operations in Canada and the United States. The Completion and Production Services segment includes service rigs and equipment rentals in Canada and the United States, and snubbing and coil tubing, camps and catering, and water systems in Canada. The Company’s operations in its segments are supported by business support systems, which include sales and marketing; procurement and distribution; manufacturing; equipment maintenance and certification, and engineering. More from Reuters »  

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