Drillers Technology Corp.

Drillers Technology Corp.

May 12, 2005 16:57 ET

Drillers Technology Releases First Quarter Results



- International revenue increase offsets early break-up in Canada.

- Record quarter for the corporation.

- 12% increase in 2005 Q1 revenue compared to 2004.

- Significant increase in 2005 net earnings compared to 2004.


The information provided below includes the Corporation's proportionate
share of the Mexican Joint Venture's revenue, net earnings and cash

($,000) Three months ended March 31
2005 2004
Consolidated Financial Results
Revenue $ 11,644 $ 10,418
Operating expenses 6,696 7.668
Gross margin 4,948 2,750
% of revenue 42% 26%
General and administrative 770 427
Depreciation and amortization 1,451 1,466
Financial items 263 529
Gain on sale of rigs - 863
Income tax (expense) (457) (356)
Net earnings 2,007 835
Net earnings per diluted share 0.07 0.03
Funds from operations 3,826 1,731
Funds per diluted share 0.12 0.05

Financial Position
Working capital before current portion
long-term debt 3,444 3,192
Long-term debt including current portion 15,751 20,170
Shareholders equity 51,019 48,117

Three months ended March 31
2005 2004
Operating Results
Wholly owned
Number of rigs 6 6
Operating days 343 387
Rig utilization rate 64% 72%
Canadian industry utilization rate 83% 75%

Mexico - Joint Venture
Number of operating rigs 8 7
Operating days 639 637
Rig utilization rate 89% 89%
Drillers Technology share of JV
Share of rigs 4 3.5
Share of operating days 326 325

Mexican Joint Venture Results of operations

The Corporation has included in its accounts the following information
in respect of its 51% ownership in the Mexican Joint Venture.

($,000) Three months ended March 31
2005 2004
Revenue $ 5,417 $ 4,492

Operations 3,295 3,476
General and administrative 264 113
Financial items 15 61

Funds from operations 1,843 842
Depreciation and amortization (854) (793)
Withholding tax (expense) (114) -
Future income tax recovery - 7
Net earnings 875 56

Current assets 3,089 4,162
Drilling rigs and related equipment 29,778 31,744
Current liabilities 1,432 4,498

In the first quarter 2005, Drillers Technology generated record revenues of $11,644 compared to $10,418 generated during the same period of 2004. Increased international revenue offset lower than anticipated first quarter revenues for the wholly owned rigs, due to a short winter drilling season resulting from early break-up in Canada.

Mexican Joint Venture

Drillers Technology de Mexico currently has two rigs drilling in Chicontepec and six rigs operating in Burgos under the new Burgos V contract. The eight rigs achieved utilization rates of 89% during the first quarter 2005.

The Mexican Joint Venture experienced significant growth in revenue with the commencement of the new Burgos V contract on December 21, 2004. Revenue contributed by Mexico was $5,417 in the first quarter 2005, an increase of 21% compared to revenues of $4,492 in 2004. With management being able to control operating expenditures during the same period, gross margins generated from operations were $2,122 or 39% of revenue compared to $1,012 or 23% of revenue in 2004.

Wholly Owned Rigs

An early break-up in Western Canada resulted in a nominal increase of 4% in revenues. However by being able to improve operating efficiencies and reduce operating expenses, Canadian gross margins for 2005 were $2,826 compared to $1,734 for 2004.

In Alaska Rig 5 operated for 58 days completing a well servicing project on an offshore platform in the Cook Inlet.

The first quarter 2005 report to shareholders, including the Corporation's consolidated financial statements and management discussion and analysis will be posted to the Drillers Technology Corp. website on May 16, 2005. Website: http://www.drillerstech.com / investor relations

Certain statements contained in this press release, including statements which are related to drilling activity and future profitability and which may contain words such as "could", "should", "expect", "believe", "will", and similar expressions and statements relating to matters that are not historical facts are forward-looking statements. Such forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of Drillers Technology Corp. to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Such factors include fluctuations in the market for oil and gas and related products and services; competition; political and economic conditions in countries in which Drillers Technology Corp. does business; the demand for services provided by Drillers Technology Corp.; changes in laws and regulations, including environmental, to which Drillers Technology Corp. is subject and other factors.

Contact Information

  • Drillers Technology Corp.
    Ronald Gnyra
    President and Chief Executive Officer
    (403) 261-9877
    Drillers Technology Corp.
    Darcy Campbell
    Vice President, Finance and Chief Financial Officer
    (403) 261-9877
    (403) 213-4860 (FAX)
    Website: http://www.drillerstech.com