In This Article:
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Revenue: $43.5 million, a slight increase from $43.4 million in Q2 last year.
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Canada Revenue: $30.8 million, an increase of 4.0% from Q2 last year.
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International Revenue: $12.7 million, down from $13.8 million in Q2 last year.
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Gross Profit: $7.2 million or 16.5% of revenue, up from $3.0 million or 6.8% of revenue in Q2 last year.
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Adjusted Gross Margin: 21.5%, compared to 12.5% in Q2 last year.
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Consolidated Earnings from Operations: $3.8 million, compared to a loss of $0.5 million in Q2 last year.
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Adjusted EBITDA: $5.6 million, up from $1.0 million in Q2 last year.
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Net Earnings: $1.5 million or $0.04 per share, compared to a net loss of $1.7 million or $0.05 per share last year.
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Credit Facility Repayment: $2.4 million repaid, compared to $0.3 million in Q2 last year.
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Long Term Debt: $18.6 million at quarter-end, compared to $21.5 million as of June 30, 2024.
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Working Capital: $49.2 million as of December 31, compared to $48.6 million at the end of fiscal 2024.
Release Date: February 13, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Orbit Garant Drilling Inc (OBGRF) reported a significant improvement in profitability compared to Q2 last year, with strong growth in adjusted gross margins, adjusted EBITDA, and net earnings.
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The company experienced increased drilling activity in Canada and South America, contributing to improved operational performance.
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Gross profit increased to $7.2 million, representing 16.5% of revenue, up from $3.0 million or 6.8% of revenue in Q2 last year.
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The company successfully exited its unprofitable operations in West Africa, which positively impacted financial results.
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Orbit Garant Drilling Inc (OBGRF) repaid a net amount of $2.4 million on its credit facility, reducing long-term debt to $18.6 million at quarter-end.
Negative Points
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International revenue declined to $12.7 million from $13.8 million in Q2 last year, reflecting the exit from West Africa.
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The company did not provide specific guidance for future earnings per share, creating uncertainty for investors focused on EPS metrics.
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The December and March quarters are historically the slowest for the company, potentially impacting future financial performance.
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Despite stable contracts, the company faces challenges in the junior mining sector due to restricted financing conditions.
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The Chilean revenue growth is expected to be modest despite new contracts and investments in drill rigs.
Q & A Highlights
Q: Can you provide some color on the year-over-year slowdown in Chilean revenue and what these three new rigs mean for that segment? A: The slowdown in Chilean revenue is due to stable activity levels, with CAD39 million in revenue last year. The new rigs are part of renewed contracts, one for three years and another for five years, with major copper mines in Chile. These rigs will help maintain stable revenue levels in the region. - Daniel Maheu, President, CEO