21-04-2025
Major Drilling Group International Inc (MJDLF) Q3 2025 Earnings Call Highlights: Revenue Surge ...
Revenue: $160.7 million, up 21% from $132.8 million last year.
Revenue Excluding Explomin: $127.9 million, down 3.7% from last year.
Net Cash Position: Over $11 million at quarter end.
Adjusted Gross Margin: 19.5%, down from 23.4% last year.
G&A Costs: $22.8 million, an increase of $5.7 million from last year.
EBITDA: $7.8 million, compared to $11.4 million last year.
Net Loss: $9.1 million or $0.11 per share, compared to a net loss of $2.3 million or $0.03 per share last year.
Capital Expenditures: $12.6 million, adding four new drill rigs.
Total Rig Count: 705, including 92 rigs from Explomin acquisition.
Specialized Work Revenue: 60% of total revenue.
Conventional Drilling Revenue: 11% of total revenue.
Underground Drilling Revenue: 29% of total revenue.
Senior and Intermediate Customers: 94% of revenue.
Junior Activity Revenue: 6% of total revenue.
Copper Revenue: 41% of total revenue.
Gold Revenue: 34% of total revenue.
Iron Ore Revenue: 10% of total revenue.
Warning! GuruFocus has detected 4 Warning Sign with MJDLF.
Release Date: March 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Major Drilling Group International Inc (MJDLF) successfully completed the acquisition of Explomin, the largest acquisition in the company's history.
The company achieved a record low total recordable injury frequency rate of 0.38, earning the Safe Everyday Gold Award.
Revenue increased by 21% year-over-year to $160.7 million, driven by the addition of Explomin.
The company ended the quarter with a strong net cash position of over $11 million, allowing for continued investment in growth opportunities.
There is a positive outlook for 2025, with increased exploration budgets from senior gold and copper customers and a rise in junior financings.
Revenue from junior customers dropped by 60%, impacting overall revenue despite gains from senior customers.
North American operations faced setbacks due to early project shutdowns and late mobilizations, affecting margins.
The overall adjusted gross margin percentage decreased to 19.5% from 23.4% in the same period last year.
The company reported a net loss of $9.1 million or $0.11 per share, compared to a net loss of $2.3 million or $0.03 per share in the prior year quarter.
General and administrative costs increased by $5.7 million due to the addition of Explomin and inflationary wage adjustments.
Q: Can you discuss the synergies from the recent Explomin acquisition? A: Denis Larocque, President, and CEO: The acquisition provides access to new markets and allows us to tap into contracts with customers who wanted us to work in those regions. Additionally, Explomin's geo solution group will assist us in other Latin American areas. There's also an exchange of expertise between the two companies, which has already begun.
Q: What are the potential impacts of tariffs, and how are you mitigating these risks? A: Denis Larocque, President, and CEO: The impact of tariffs is minimal due to our geographic and supplier diversity. We can shift purchasing to minimize tariff impacts, which is an advantage not available to companies operating in fewer countries.
Q: What are you hearing from juniors regarding sentiment compared to last year? A: Denis Larocque, President, and CEO: The sentiment has improved slightly with gold and copper prices rising, but financing remains limited. However, senior exploration budgets have increased significantly, which is promising for future activity.
Q: Can you elaborate on the discussions with customers at PDAC? A: Denis Larocque, President, and CEO: PDAC was very positive, with increased interest from seniors in our geo solution offerings. Exploration budgets from seniors are up 18% to 20%, and there was substantial interest in our combined drilling and geo solution services.
Q: How are you positioned for future growth opportunities? A: Denis Larocque, President, and CEO: We are well-positioned with a strong balance sheet and a net cash position of over $11 million. This allows us to invest in growth opportunities and prepare for increased activity in 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
