In This Article:
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Revenue: $434.6 million in Q3 2024, a 2% decrease from $444.4 million in Q3 2023.
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Adjusted EBITDA: $119 million in Q3 2024, a 1% increase from $117.3 million in Q3 2023.
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Operating Days: 3,065 in the US (14% decrease), 3,861 in Canada (18% increase), 1,269 internationally (consistent with Q3 2023).
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Debt Reduction: $44.7 million repaid in Q3 2024; $135 million repaid year-to-date 2024.
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Interest Expense: Decreased by 24% to $23.8 million from $31.3 million.
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Capital Expenditures: $33.5 million in Q3 2024, with $5 million in upgrade capital and $32.3 million in maintenance capital.
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Depreciation Expense: $261.8 million for the first nine months of 2024, a 14% increase from $229.6 million in the same period of 2023.
Release Date: November 01, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Ensign Energy Services Inc (ESVIF) achieved a strong quarter-over-quarter gain driven by high demand for its high-spec Canadian rigs, particularly singles, doubles, and triples.
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The company successfully reduced its debt by $45 million in the third quarter, totaling $135 million year-to-date, and is on track to meet its $600 million debt reduction target by 2025.
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Canadian operations saw an 18% increase in operating days, contributing positively to the company's performance.
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Interest expenses decreased by 24% due to lower debt levels and reduced effective interest rates, which will continue to decline as debt levels decrease.
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The EDGE AutoPilot technology is expanding, providing additional revenue streams and differentiating Ensign from competitors.
Negative Points
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The US business unit experienced a 14% decrease in operating days, contributing to a decline in overall revenue.
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Revenue for the third quarter of 2024 decreased by 2% compared to the same period in the previous year.
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Adjusted EBITDA for the first nine months of 2024 was 7% lower than the same period in 2023, primarily due to declines in US drilling activity.
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Depreciation expenses increased by 14% in the first nine months of 2024 compared to the previous year.
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The US market is facing challenges due to depressed natural gas prices and significant M&A activity, leading to reduced short-term work.
Q & A Highlights
Q: Bob, you mentioned being booked on triples in Canada. Are there idle rigs, and how do you plan to market them with LNG Canada coming online? A: Robert Geddes, President and COO: We have a few rigs ready to work without capital investment and expect them to be contracted by the first quarter. LNG effects will likely be seen in the latter half, requiring a steady platform of high-spec triples. Current rates aren't high enough to support new builds, which would need to be in the 50s.