Precision Drilling lifts third-quarter revenue 15% to C$531.652 million
Key Facts
Precision Drilling reported third-quarter results on October 27, posting revenue of C$531.652 million, up 15% from the same period in 2025. Net income attributable to shareholders was C$20.917 million, compared with a loss of C$6.761 million a year earlier. Basic and diluted earnings per share also turned positive at C$1.65, after a loss of C$0.51 per share in the third quarter of 2025. Adjusted EBITDA rose 6.4% to C$125.116 million from C$117.632 million. The company said stronger activity in North America supported results, while U.S. rig reactivation costs and lower international margins limited operating earnings growth.
Revenue increased in both the Canadian and U.S. markets, rising C$33 million in Canada and C$42 million in the United States, while international results fell C$6 million. The company attributed the improvement in Canada to stronger demand for drilling activity and well services. In the United States, the average number of active rigs rose to 43 in the third quarter from 36 a year earlier. Revenue per operating day increased to US$33,270 from US$31,040. The chief executive said rig utilization rose year over year by 16% in Canada and 19% in the United States, and that the company reactivated 6 U.S. rigs to meet demand.
The Contract Drilling Services segment reported revenue of C$454.190 million, up 16.2% from C$390.943 million a year earlier. But the segment’s operating costs rose 21.9% to C$322.211 million. The company said higher costs to reactivate rigs in the United States weighed on quarterly margins, along with lower international margins. In the second quarter of 2026, revenue had risen 11% to C$453 million, while adjusted EBITDA fell 10% to C$97 million from C$108 million. In the first nine months of the year, revenue increased 10.6% to C$1.511 billion, but adjusted EBITDA declined 4.7% to C$346.118 million, and net income attributable to shareholders fell 15.7% to C$37.098 million.
Cash flow from operations in the third quarter fell to C$70.813 million from C$75.869 million a year earlier. The company, meanwhile, repurchased C$31 million of common shares during the quarter. Cash flow from operations in the first nine months was C$279.536 million, compared with C$286.783 million in the same period a year earlier. The company said it had repurchased C$47 million of shares since the start of the year and reduced debt by C$75 million. Capital expenditures were C$82 million in the quarter, compared with C$69 million a year earlier.
Precision raised its 2026 capital budget to a range of C$275 million to C$285 million from a previous budget of C$265 million. It said the revision accommodates long-lead delivery requirements and a pending upgrade opportunity. The opportunity could involve several rigs contracted through 2029 for a major Canadian producer. The company plans to complete upgrades on 25 rigs in Canada and the United States during 2026, backed by long-term contracts. It said it has 7 active rigs internationally, including 4 in Kuwait and 3 in Saudi Arabia, all backed by long-term contracts.
The company expects U.S. operating margins to rise by about 30% in the fourth quarter of 2026 as the pace of rig reactivations slows, with an average of between US$9,500 and US$10,500 per utilization day. It also expects North American drilling and completion activity to remain resilient through the end of 2026, with growth potentially emerging in early 2027. The company said demand for Super Series rigs is strong and their utilization could approach full capacity during Canada’s winter drilling season. In Kuwait, it expects its idle rig to return to work in mid-2027 under a 5-year contract, after recertification and upgrades. The company had scheduled its earnings call for October 28 at 11:00 a.m. Mountain Time, or 1:00 p.m. Eastern Time.