Shares of Precision Drilling (NYSE: PDS) surged in morning trading today after the company announced better-than-expected profit and revenue for the second quarter. The increase was attributed to higher day rates for its drilling rigs.
As of 9:44 a.m. ET, shares of Precision Drilling were up 4.3% at CAD 81.52 ($64.75).
The Canadian drilling rig contractor saw a significant increase in day rates, with a 25% rise in Canada and a 39% increase in the U.S. compared to the previous year.
Revenue per utilization day also improved, reaching CAD 33,535 in Canada and $35,576 in the U.S. Moreover, daily operating margins saw positive growth, standing at CAD 12,203 and $16,613 respectively.
Thanks to these positive trends, Precision Drilling’s second-quarter revenue reached CAD 425.6 million, up from CAD 326 million the previous year. This contributed to a swing to a profit of CAD 1.63 per share, compared to a loss of CAD 1.81 per share.
Analysts surveyed by FactSet had predicted revenue and profit increases, but their forecasts were lower, with revenue projected at CAD 412.4 million and earnings of CAD 1.41 per share.
During the quarter, Precision Drilling had an average of 42 active rigs in Canada, representing a 12% increase compared to the same period last year. In the U.S., however, the company experienced an 8% reduction in rigs, with a total of 51.