Drillers Technology Corp.
TSX : DLR

Drillers Technology Corp.

November 09, 2005 17:38 ET

Drillers Technology Releases Third Quarter Results

CALGARY, ALBERTA--(CCNMatthews - Nov. 9, 2005) - Drillers Technology Corp. (TSX:DLR)

Highlights:

- Canadian and International revenues increased year over year

- Year to date earnings per share of $0.09


FINANCIAL SUMMARY

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



------------------------------------------------------------------------
Three months Nine months
ended September 30 ended September 30
($000) 2005 2004 2005 2004
------------------------------------------------------------------------

Consolidated Financial Results
Revenue $8,161 $7,107 $26,070 $23,811
Operating expenses 5,077 4,667 16,040 16,972
Gross Margin 3,084 2,440 10,030 6,839
% of revenue 38% 34% 38% 29%
General and administrative 743 518 2,266 1,442
Depreciation and amortization 1,416 1,273 4,147 3,840
Financial items 433 443 1,161 1,588
Gain on sale - - (617) (863)
Income tax expense (reduction) 6 86 324 (121)
Net earnings 486 120 2,749 953
Net earnings per diluted share 0.02 - 0.09 0.03
Funds from operations 1,922 1,473 6,441 3,649
Funds per diluted share 0.06 0.05 0.21 0.12


Financial Position
Working capital before current
portion long-term debt 4,279 747
Long-term debt including
current portion 12,294 18,612
Shareholder's equity 51,992 48,259
------------------------------------------------------------------------
------------------------------------------------------------------------



------------------------------------------------------------------------
Three months Nine months
ended September 30 ended September 30
2005 2004 2005 2004
------------------------------------------------------------------------

Operating Results
Wholly Owned And Operated
Number of rigs 2 5 4 5
Operating days 90 51 421 435
Rig utilization rate 49% 11% 39% 38%
Canadian industry
utilization rate 63% 46% 56% 50%

Wholly Owned Non-operated Lease
Number of rigs 4 1 2 1
Operating days 137 76 191 185
Rig utilization rate 37% 83% 35% 68%

Mexico - Joint Venture
Number of operating rigs 8 8 8 8
Operating days 603 584 1,868 1,775
Rig utilization rate 82% 80% 86% 86%
Drillers Technology share of JV
Share of rigs 4 4 4 4
Share of operating days 308 298 953 905
------------------------------------------------------------------------
------------------------------------------------------------------------


Funds from operations is defined as earnings (loss) for the period adjusted for items not involving cash, before changes in non-cash working capital

In the third quarter 2005, Drillers Technology generated revenues of $8,161 compared to $7,107 generated during the same period of 2004. Increased Canadian revenues are a result of utilization within Canada and the lease revenue from rigs operating in the United States. Mexico is showing increases from strong utilization and day rates.

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.



------------------------------------------------------------------------
Three months Nine months
ended September 30 ended September 30
($000) 2005 2004 2005 2004
------------------------------------------------------------------------

Revenue $5,643 $4,862 $16,775 $14,516

Expenses
Operations 4,017 3,462 10,784 10,584
General and administrative 210 158 660 401
Financial items 7 - 22 92
Withholding tax expense 114 - 355 -

Funds from operations 1,295 1,242 4,954 3,439
Depreciation and amortization 998 991 3,035 2,685
Future income tax (reduction) (50) 55 (176) (89)
Net earnings 347 196 2,095 843

Current assets $4,609 $3,586
Drilling rigs and related
equipment 27,491 31,302
Current liabilities 1,928 4,772
------------------------------------------------------------------------
------------------------------------------------------------------------


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 82% during the third 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 $5,643 in the third quarter 2005, an increase of 16% over revenues of $4,862 in 2004.

Wholly Owned Rigs

The Corporation has leased three wholly owned rigs to a shareholder for potential casing drilling opportunities in the United States. The rigs have been leased at competitive rates for a guaranteed 300 operating days over a twelve month term.

In Alaska, Rig 5 is on a non-operating lease and is contracted through to spring.

The third 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 November 15, 2005. Website: 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
    or
    Drillers Technology Corp.
    Darcy Campbell
    Vice President, Finance and Chief Financial Officer
    (403) 261-9877
    (403) 213-4860 (FAX)
    Website: www.drillerstech.com