MONCTON, NB, Sept. 5, 2012 /CNW/ - Major Drilling Group International Inc. (TSX: MDI) today reported results for its first quarter of fiscal year 2013, ended July 31, 2012.
In millions of Canadian dollars
(except earnings per share)
Q1-13 Q1-12 Revenue $237.6 $164.2 Gross profit 81.3 51.5 As percentage of sales 34.2% 31.4% EBITDA(1) 60.1 35.7 As percentage of revenue 25.3% 21.7% Net earnings 31.9 17.9 Earnings per share 0.40 0.25
“Looking forward, the demand for drilling services from the senior and intermediate mining houses continues. Revenue from these clients increased in the last quarter to just over $175 million compared to $102 million in the same quarter last year. Our customers remain committed to the large majority of their projects in order to replace their reserves. Senior miners will represent a greater proportion of our drilling projects going forward as junior miners become more and more cautious in their spending, given the difficulty in accessing capital.”
“Overall, we expect demand for specialized drilling to continue in the year ahead. At the end of July, specialized drilling represented 76% of our revenue and nearly half of our projects were drilling for gold. While we are optimistic that our senior customers will continue with the majority of their projects, we anticipate that overall drilling activities will decline somewhat over the next six months, particularly with respect to our junior mining clients. In anticipation of a slight decrease of our activity levels, we have reduced our capital expenditure budget for fiscal 2013 to $70 million, down from the $100 million previously announced. Because of our ongoing need to be able to respond to demand for specialized services, and the need to continue to modernize our fleet, we currently have 15 additional rigs on order.”
“Given the Company’s continuing ability to generate significant cash, and our minimal debt levels, we have determined that it is appropriate to increase our semi-annual dividend to $0.10 per common share, which will be paid on November 1, 2012 to shareholders of record as of October 10, 2012. This dividend is designated as an “eligible dividend” for Canadian tax purposes.”