Proactiveinvestors United Kingdom Capital Drilling Ltd https://www.proactiveinvestors.co.uk Proactiveinvestors United Kingdom Capital Drilling Ltd RSS feed en Wed, 20 Mar 2019 05:38:44 +0000 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - Capital Drilling highlights “a year of significant progress” as it reveals 2018 revenue, profit growth ]]> https://www.proactiveinvestors.co.uk/companies/news/216459/capital-drilling-highlights-a-year-of-significant-progress-as-it-reveals-2018-revenue-profit-growth-216459.html Capital Drilling Ltd (LON:CAPD) executive chairman Jamie Boyton spoke of “a year of significant progress” as the mining contractor released results for 2018.

The group reported US$116mln of revenue, slightly above guidance of US$105mln to US$115mln, while underlying earnings (EBITDA) rose by 16% to US$28.3mln. Operating cash flow increased by 9% to US$22.5mln from US$20.7mln in the prior year. Net profit was reported at US$7.7mln which represented a 48% improvement from the US$5.2mln achieved in 2017.

It finished the year with net cash of US$10.9mln, up 122% on 2017, and announced a 25% increase to the final dividend to 1.5 US cents per share to be paid on 3 May.

WATCH: Improved performance 'a validation' of Capital Drilling's strategy

Boynton said: "Capital Drilling enjoyed a year of significant progress with record net cash generated from our assets, a further strengthening of the balance sheet, as well as key strategic growth into West Africa."

He added: “The quality of our business mix further improved with extensions to a number of our long-term drilling contracts, ARPOR remaining consistently robust, whilst utilisation saw a further improvement in the second half of the year, particularly with our exploration rig fleet. 

“All of these metrics were underpinned by an exceptional safety record with zero LTIs and a halving of our AIFR to an industry leading 0.45, which demonstrates the management's focus on our goal  of a zero harm strategy.”

Looking to the current year, Capital Drilling said it anticipates revenue of between US$110mln and US$120mln and noted that its business is underpinned by existing contracts.

The company expects to benefits from investments made in 2018, including new infrastructure and maintaining a high-quality rig fleet.

Boyton concluded: “The outlook for 2019 remains encouraging, albeit amidst mixed market drivers, specifically supportive commodity prices, in particular gold which represents circa 90% of group revenue, offset by continued weak capital markets that impacted the funding for exploration activity.

“Our significantly increased presence in the key West African markets provides optimism for further contract wins over the year ahead.”

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Thu, 14 Mar 2019 08:43:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/216459/capital-drilling-highlights-a-year-of-significant-progress-as-it-reveals-2018-revenue-profit-growth-216459.html
<![CDATA[RNS press release - Full Year Results ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20190314070004_14001493/ Thu, 14 Mar 2019 07:00:04 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20190314070004_14001493/ <![CDATA[RNS press release - Director Declaration ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20190306100117_13992174/ Wed, 06 Mar 2019 10:01:17 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20190306100117_13992174/ <![CDATA[Media files - Improved performance 'a validation' of Capital Drilling's strategy ]]> https://www.proactiveinvestors.co.uk/companies/stocktube/11890/improved-performance--a-validation--of-capital-drilling-s-strategy-11890.html Fri, 18 Jan 2019 09:45:00 +0000 https://www.proactiveinvestors.co.uk/companies/stocktube/11890/improved-performance--a-validation--of-capital-drilling-s-strategy-11890.html <![CDATA[News - Capital Drilling boasts strong performance boosted by West Africa activity ]]> https://www.proactiveinvestors.co.uk/companies/news/212775/capital-drilling-boasts-strong-performance-boosted-by-west-africa-activity-212775.html Capital Drilling Ltd (LON:CAPD) executive chairman Jamie Boyton described the mine services contractor’s performance in 2018 as strong, especially in the second half.

The company, in a statement, gave investors an update on the fourth quarter ahead of the release of full-year financial results on 14 March.

It reported fourth-quarter revenue at US$30.5mln, down 1% from US$31mln in the preceding three month period, but, up 12.5% compared to the same quarter a year ago.

The unaudited figure for the twelve month period was US$116mln, down 3% from the 2017 total, but, above the company’s top-end guidance range which was set at US$105mln to US$115mln.

READ: Capital Drilling clinches new contracts and key renewals

Capital Drilling highlighted that cash flow generation rose significantly, with year-end cash amounting to US$10.9mln compared to US$3.4mln at the halfway marker (30 June 2018). At the same time, the net debt position improved to US$9mln, from US$12mln at the end of 2017.

Operational activity improved with utilisation rates measuring 59% at the end of the quarter, versus 47% in the comparative quarter of 2017, thanks to increased exploration activity in West Africa and Botswana.

The company highlighted that its long term contracts continue to perform strongly and it has seen a substantial increase in new tender opportunities through the second half of 2018.

"Capital Drilling's trading performance in 2018 was strong, particularly in the second half of the year which saw the group accelerate its penetration into the fast growth West African mineral drilling industry,” Boyton said.

“The quality of our business improved further, with zero LTIs [lost time incidents] recorded, an outstanding result, in addition to some material contract extensions with some of our longstanding blue chip customers.”

“The improvement in utilisation, specifically in exploration contracts, as well as the prudent management of working capital across the group, translated into improved cash generation over prior periods, further strengthening the group's balance sheet.

He added: “The current year has started strongly with solid tendering activity in West Africa, where we are benefitting from the infrastructure investment that we have made over the past 12 to 18 months."

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Thu, 17 Jan 2019 09:24:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/212775/capital-drilling-boasts-strong-performance-boosted-by-west-africa-activity-212775.html
<![CDATA[RNS press release - Q4 2018 Trading Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20190117070005_13937362/ Thu, 17 Jan 2019 07:00:05 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20190117070005_13937362/ <![CDATA[News - Capital Drilling clinches new contracts and key renewals following strong first half ]]> https://www.proactiveinvestors.co.uk/companies/news/212348/capital-drilling-clinches-new-contracts-and-key-renewals-following-strong-first-half-212348.html Capital Drilling Limited (LON:CAPD) has secured a new contract award as well as the extension of other key deals following on from a strong performance in the first half of the year.

In December, the drilling services provider extended its contract with global gold miner AngloGold Ashanti Limited (NYSE:AU) for its Geita mine in Tanzania.

READ: Capital Drilling extends Geita contract with Anglo Gold Ashanti

Under the contract Capital will continue underground exploration and grade control drilling, under a sub-contract to a five-year master agreement which currently runs to December 2020. It has operated at the Geita mine since 2006.

The extension followed another important win in October with a big gold player, FTSE 250 mining firm Centamin PLC (LON:CEY).

READ: Capital Drilling lands contract renewal for Centamin’s Sukari mine

Capital currently operates a fleet of 14 drilling rigs at Centamin’s flagship Sukari gold mine in Egypt, where they provide blast hole and grade control drilling services for the open pit operation, with the extension ensuring these rigs will be active at the site until at least 2023.

"Capital Drilling has been working with Centamin for fourteen years and we are delighted to continue this relationship as the demand for our services continues,” said Jamie Boyton, Capital Drilling chairman.

“This contract extension is a testament to the Group's solid operational performance and provides stability in operations to support our ongoing investment, in what is one of the highest quality and long-life gold mines globally," he said.

New contract in Côte d'Ivoire

Both renewals were preceded by some new business for the firm in the form of a delineation drilling contract in Côte d'Ivoire with Canadian miner Sama Resources Inc (CVE:SME).

Capital said the contract will initially utilise two diamond drill rigs, sourced from the group's base in Yamoussoukro, which was established in first-half of 2018.

READ: Capital Drilling awarded a delineation drilling contract at Sama Resources property in Côte d'Ivoire

The initial programme includes 6,000 metres of diamond core drilling, targeting semi-massive and massive polymetallic sulphide targets for Nickel-Copper-Cobalt-Palladium.

The Sama contract is Capital’s first in the country following its strategic expansion into the West African region, where it now has 31 rigs or a third of its fleet.

The group also operates a delineation drilling contract in Mali for Hummingbird Resources PLC (LON:HUM).

Strong first half and early second half performance

In its results for the first half of the year in August, Capital reported improved underlying earnings (EBTIDA) of US$12.5mln, up 7.8% on the prior year, as margins increased to 22.9% due to better cost management. Similarly, net profit rose 7.7% to US$2.8mln.

Revenues were US$54.5mln, down 4.6% against the 2017 comparative, although this was mainly due to lower fleet utilisation amid a relocation of assets to West Africa.

READ: Capital Drilling boasts strong first-half performance

Per share earnings increased 5% to 2 US cents, and the company is increasing its half year dividend by 20% to 0.6 US cent per share.

Results following these for the three months to September showed that revenues in that period had increased 12% to US$31mln compared to the previous quarter and by 3% year-on-year.

READ: Capital Drilling encouraged by pick up in West African activity

With shares trading at around 40p as of 10 January, Capital Drilling carries a market cap of £54.3mln.

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Thu, 10 Jan 2019 11:00:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/212348/capital-drilling-clinches-new-contracts-and-key-renewals-following-strong-first-half-212348.html
<![CDATA[News - Capital Drilling extends Geita contract with Anglo Gold Ashanti ]]> https://www.proactiveinvestors.co.uk/companies/news/211034/capital-drilling-extends-geita-contract-with-anglo-gold-ashanti-211034.html Capital Drilling Ltd (LON:CAPD) has extended its contract with Anglo Gold Ashanti for the Geita mine, in Tanzania.

The London listed mining services contractor will continue underground exploration and grade control drilling, under a sub-contract to a five-year master agreement which currently runs to December 2020. It has operated at the Geita mine since 2006.

READ: Capital Drilling lands contract renewal for Centamin’s Sukari mine

"The experience Capital Drilling has gained at the Geita Gold Mine over the past thirteen years underpins our strategy of targeting Tier 1 long-life assets with quality operators,” said Jamie Boyton, Capital Drilling executive chairman.

“We continue to deliver excellent operational results for AngloGold Ashanti and are pleased to have the extension of the underground drilling contract for a further year."

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Wed, 12 Dec 2018 07:50:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/211034/capital-drilling-extends-geita-contract-with-anglo-gold-ashanti-211034.html
<![CDATA[RNS press release - Contract Extension at Geita Gold Mine, Tanzania ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181212070004_13900156/ Wed, 12 Dec 2018 07:00:04 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181212070004_13900156/ <![CDATA[Media files - Capital Drilling Ltd - Proactive Investors Mining Capital Conference November 2018 ]]> https://www.proactiveinvestors.co.uk/companies/stocktube/11408/capital-drilling-ltd-proactive-investors-mining-capital-conference-november-2018-11408.html Mon, 03 Dec 2018 13:36:00 +0000 https://www.proactiveinvestors.co.uk/companies/stocktube/11408/capital-drilling-ltd-proactive-investors-mining-capital-conference-november-2018-11408.html <![CDATA[RNS press release - Change of Joint Broker ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181123070003_13877937/ Fri, 23 Nov 2018 07:00:03 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181123070003_13877937/ <![CDATA[Media files - Capital Drilling reports strong growth with significant contract wins ]]> https://www.proactiveinvestors.co.uk/companies/stocktube/10983/capital-drilling-reports-strong-growth-with-significant-contract-wins-10983.html Thu, 25 Oct 2018 11:07:00 +0100 https://www.proactiveinvestors.co.uk/companies/stocktube/10983/capital-drilling-reports-strong-growth-with-significant-contract-wins-10983.html <![CDATA[News - Capital Drilling lands contract renewal for Centamin’s Sukari mine ]]> https://www.proactiveinvestors.co.uk/companies/news/207814/capital-drilling-lands-contract-renewal-for-centamins-sukari-mine-207814.html Capital Drilling Ltd (LON:CAPD) told investors it has landed an important new contract extension, keeping its rigs active at Centamin’s Sukari gold mine, in Egypt, until at least 2023.

It presently has a fleet of 14 rigs at Sukari where it provides blast hole and grade control drilling services for Centamin’s open pit operation. Capital drilling has been active at the mine since 2005.

WATCH: Capital Drilling Ltd - Proactive Investors Mining Capital Conference November 2018

"Capital Drilling has been working with Centamin for fourteen years and we are delighted to continue this relationship as the demand for our services continues,” said Jamie Boyton, Capital Drilling chairman.

“This contract extension is a testament to the Group's solid operational performance and provides stability in operations to support our ongoing investment, in what is one of the highest quality and long-life gold mines globally," he said.

finnCap says its significant news

House broker finncap analyst David Buxton described the Centamin extension and Wednesday’s new business win as ‘significant news’.

“The contract extension with Centamin underwrites continuity of a substantial proportion of group revenues over a 5-year period, while the new contract with Sama is the first in Cote d’Ivoire and highlights the potential of West Africa since the company strategically repositioned one-third of its rigs in this growth region,” Buxton said.

READ: Capital Drilling wins contract for Sama Resources in Côte d'Ivoire

He added: “While we retain existing forecasts, these contracts greatly improve revenue visibility and therefore should increase investor confidence. Further contract awards would have a significant drop through to profits and offer potential forecast upside.”

finncap has an 85p price target for Capital Drilling, in early afternoon trading, the shares held steady at 38.50p.

 -- Adds video link --

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Thu, 25 Oct 2018 07:31:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/207814/capital-drilling-lands-contract-renewal-for-centamins-sukari-mine-207814.html
<![CDATA[RNS press release - Contract Extension at Sukari ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181025070006_13841606/ Thu, 25 Oct 2018 07:00:06 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181025070006_13841606/ <![CDATA[News - Capital Drilling awarded a delineation drilling contract at Sama Resources property in Côte d'Ivoire ]]> https://www.proactiveinvestors.co.uk/companies/news/207743/capital-drilling-awarded-a-delineation-drilling-contract-at-sama-resources-property-in-cte-d-ivoire-207743.html Capital Drilling Limited (LON:CAPD) shares rose on Wednesday on news it has been awarded a delineation drilling contract with Canadian-based Sama Resources Inc. at its Yepleu property in Côte d'Ivoire. 

The FTSE Fledgling-listed drilling solutions company, which is focused on the African markets, noted that the contract is its first in the country following its strategic expansion into West Africa where the company now has 31 rigs, representing a third of its rig fleet.

READ: Capital Drilling encouraged by pick up in West African activity

The firm said the contract will initially utilise two diamond drill rigs, sourced from the group's base in Yamoussoukro, which was established in first-half of 2018.

The company said drilling is anticipated to commence in November with the initial programme being 6,000 metres of diamond core drilling, targeting semi-massive and massive polymetallic sulphide targets for Nickel-Copper-Cobalt-Palladium.

Commenting on the contract award, Jamie Boyton, Capital Drilling’s executive chairman, said: “With the increased fleet and new infrastructure in place, we are well positioned to continue to secure additional work in the country in the future."

In early morning trading, Capital Drilling shares were 5.3% higher at 39.50p.

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Wed, 24 Oct 2018 09:15:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/207743/capital-drilling-awarded-a-delineation-drilling-contract-at-sama-resources-property-in-cte-d-ivoire-207743.html
<![CDATA[RNS press release - Contract Win ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181024082117_13840361/ Wed, 24 Oct 2018 08:21:17 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181024082117_13840361/ <![CDATA[News - Capital Drilling encouraged by pick up in West African activity ]]> https://www.proactiveinvestors.co.uk/companies/news/206876/capital-drilling-encouraged-by-pick-up-in-west-african-activity-206876.html Africa-focused mining contractor Capital Drilling Limited (LON:CAPD) saw another uptick in activity in its latest quarter as exploration picked up.

Capital Drilling has just started work on its first exploration contract in Tanzania for two years (for Graphex), which helped fleet utilisation rise to 53%.

New projects also included work for De Beers in Botswana and for Hummingbird in Mali.

Revenues in the three months to September rose by 12% to US$31mln compared to the previous quarter and by 3% year-on-year.

Rig rates were flat US$198,000 per month on average.

Jamie Boyton, chief executive, said it has continued to switch resources to West Africa.

“The commencement of delineation drilling activities with Hummingbird Resources in Mali further adds to the Group's contracts in West Africa, with a third of our rig fleet now located in the region.

“As we enter the fourth quarter we remain optimistic for a solid performance for the year. Enquiry levels remain strong and we anticipate further contract wins as we emerge from the wet season in the key growth markets in West Africa".

The company ended the quarter with net cash of US$4.1mln.

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Thu, 11 Oct 2018 08:59:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/206876/capital-drilling-encouraged-by-pick-up-in-west-african-activity-206876.html
<![CDATA[RNS press release - Q3 Trading Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181011070004_13824246/ Thu, 11 Oct 2018 07:00:04 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20181011070004_13824246/ <![CDATA[News - Capital Drilling boasts strong first-half performance ]]> https://www.proactiveinvestors.co.uk/companies/news/203035/capital-drilling-boasts-strong-first-half-performance-203035.html Capital Drilling Ltd (LON:CAPD) today reported what it described as “another strong" half yearly results, with the company pleased with both its financial performance and the execution of its strategy.

The Africa-focussed drilling contractor to the mining sector, delivered US$54.5mln of revenue, down 4.6% against the 2017 comparative, as a result of lower fleet utilisation amid a relocation of assets to West Africa.

Earnings (EBITDA), meanwhile, improved 7.8% to US$12.5mln as margins increased to 22.9% due to better cost management. Similarly, net profit rose 7.7% to US$2.8mln.

READ: Capital Drilling boosted by mining exploration upswing in West Africa

Per share earnings increased 5% to 2 US cents, and the company is increasing its half year dividend by 20% to 0.6 US cent per share (to be paid on 5 October).

The company said that capital spending had increased 11% to US$4.7mln in the first half as it bought replacement rigs and invested in asset improvements. It ended the period with US$3.4mln of net cash.

Capital Drilling landed seven contracts in the first half, securing work for 15 rigs. First half, rig utilisation reduced to 46% from 56%, on an average fleet size of 94, albeit that was due to the ‘substantial asset redeployment’ during the period.

Building business in West Africa

“The building of our business in West Africa has been the major focus of our growth strategy over the past 6 months,” said Jamie Boyton, Capital Drilling executive chairman.

“The group has developed new operational centres in Côte d'Ivoire and Mali over the period, complementing our long established operations in Mauritania, all of which provide the infrastructure to deploy further production and exploration rigs into what is regarded as one of the fastest growing drilling markets in the industry.

“We ended the half year period with 26 rigs across these countries, almost doubling our capacity in the six month period, with further rigs and assets due to arrive in the third quarter.”

Boyton added: “Our increased footprint and presence in West Africa has yielded early results, with the Group announcing three new contracts in the region, with Kinross Gold (Tasiast), Resolute Mining (Syama) and Hummingbird Resources (Yanfolila).

“As a result of these contract wins, along with exploration contract wins in Botswana, Egypt and Tanzania, the Group expects to see an increase in utilisation rates over the second half, which fully underpins the investment we have made to target the West African market.”

Looking ahead, Capital Drilling highlighted supportive forward trading conditions with elevated numbers of enquires and tendering requests.

Signs of improvement in Tanzania

It noted that activity levels in Tanzania, which has seen political disruption in the mining sector, have remained subdued although Capital Drilling noted that recent feedback suggests constructive dialogue with the Government and progress with a newly-formed Mining Commission.

“We are encouraged to see early signs of improvement in the Tanzanian market, including the formation of the Mining Commission and increasingly positive feedback on Government engagement from companies operating in the country,” Boyton said.

“The awarding of our first exploration contract in Tanzania in two years is particularly encouraging, as we continue to seek to utilise our substantial latent capacity in our exploration fleet.”

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Thu, 16 Aug 2018 08:27:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/203035/capital-drilling-boasts-strong-first-half-performance-203035.html
<![CDATA[RNS press release - Half Year Results ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180816070003_13757228/ Thu, 16 Aug 2018 07:00:03 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180816070003_13757228/ <![CDATA[RNS press release - Board Changes ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180726073001_13732182/ Thu, 26 Jul 2018 07:30:01 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180726073001_13732182/ <![CDATA[News - Capital Drilling boosted by mining exploration upswing in West Africa ]]> https://www.proactiveinvestors.co.uk/companies/news/200463/capital-drilling-boosted-by-mining-exploration-upswing-in-west-africa-200463.html An upswing in exploration for minerals in West Africa provided good momentum for Capital Drilling PLC (LON:CAPD) in the latest half-year.

Revenues at the drilling contractor rose to US$27.8mln in the quarter to June, a 4.5% increase on the previous quarter though 9.4% lower than a year ago.

WATCH: Capital Drilling expanding in West Africa and targeting longer-term contracts

Revenue per drill rig rose 4.7% to US$200,000 on average.   

Capital has been shifting kit out of Tanzania, where Acacia Mining is a substantial customer, over to the west of the continent.

There were 26 rigs in the Ivory Coast, Mali and Mauritania at end June out of a total fleet of 95 with a further six rigs scheduled to move in the next quarter.

"Market sentiment remains buoyant and we are seeing further strength in the exploration markets and increasing drilling budgets from major mining companies," said Jamie Boyton, executive chairman.

"There remains a fundamental requirement from the mining industry to replace resources and reserves depleted during the downturn, when exploration drilling was significantly reduced due to budgetary constraints.

"We remain confident that we will secure further contract wins in the current quarter.

New operational centres in Ivory Coast and Mali will enable more rigs to be deployed into what is regarded as one of the fastest growing drilling markets in the industry, he added. 

Fleet utilisation rose to 48% from 44% over the quarter and Boynton expects a further rise over the remainder of the year as new contracts start.

 

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Tue, 10 Jul 2018 09:04:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/200463/capital-drilling-boosted-by-mining-exploration-upswing-in-west-africa-200463.html
<![CDATA[RNS press release - Trading Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180710070002_13711277/ Tue, 10 Jul 2018 07:00:02 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180710070002_13711277/ <![CDATA[News - Capital Drilling upgrades forecasts on the back of recent successes; lands three new contracts ]]> https://www.proactiveinvestors.co.uk/companies/news/199001/capital-drilling-upgrades-forecasts-on-the-back-of-recent-successes-lands-three-new-contracts-199001.html Capital Drilling Ltd (LON:CAPD) has upgraded its revenue guidance after a buoyant first half.

It expects turnover to be in the US$105-US$115mln range, up from a previous forecast of US$100-US$110mln.

The company will update on its performance in the first six months of the financial year on July 10.

It told investors Monday it had seen increased demand for its services in the mining sector after landing three new exploration and delineation contracts.

Egypt and Tanzania

In Egypt, Aton Resources has hired the company's reverse circulation rig for a 15,000-metre campaign, while Graphex Mining has called on its expertise in Tanzania to carry out 3,000 metres drilling on the Chilalo Graphite Project.

Moving to Botswana, the diamond giant De Beers has called in Capital to help it carry out 11,000 metres of delineation drilling at the Kokong project in Botswana.

Chairman Jamie Boynton said: "We are pleased to announce a number of successful exploration and delineation contract awards that will be carried over the second half of 2018. 

"All three contract awards are in existing countries of operation for Capital Drilling, allowing us to leverage our infrastructure and assets already in country. 

"The last few months have seen an increase in demand for exploration rigs, which will benefit Capital Drilling's utilisation rates from this segment of the market."

West Africa booming 

In a separate announcement, the company updated on its progress in West Africa, where it has two contracts in Mali – one already underway, the other imminent – along with work in Mauritania.

Resolute Mining and Hummingbird Resources are using its services in Mali, while Kinross is the client in Mauritania.

By the second-half, it will have doubled the size of its rig fleet in West Africa.

Shares trading at discount to broker's valuation 

The shares, up 10% in the last month, edged 0.2p higher to 44.4p, valuing the business at £60.5mln.

Broker finnCap reckon the stock is worth 109p. “The shares continue to trade at depressed levels, with sentiment dominated by the ongoing Tanzania situation,” it told investors.

The mining industry has come under tough scrutiny from the government of what was formerly one of East Africa’s more politically friendly nations.

It’s a spat that initially focused on Acacia Mining, though some of the junior diggers were caught in the cross-fire.

Executives working in the country reckon the government is becoming less confrontational and more accommodating amid fears the recent crackdown may start deterring investment.

However, this view is not universally shared in the markets, which still tend to ascribe a discount rating to Tanzania-focused mining businesses.

Global experience

Capital operates one of the youngest fleets in the industry. It owns 25 blast hole, 47 diamond, 14 reverse circulation and seven underground rigs and has deployed kit in Africa, Eastern Europe, Asia and Latin America.

“We take the time to understand local regulations and customs in all countries we operate in,” its website says.

“This ensures our activities are compliant and our operations considerate of local traditions. 

“We experience improved efficiencies, faster project start-up and smoother ongoing operations as a result.”

Its clients have included Barrick, BHP Billiton Glencore, Kinross and Rio Tinto.

 

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Mon, 18 Jun 2018 07:48:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/199001/capital-drilling-upgrades-forecasts-on-the-back-of-recent-successes-lands-three-new-contracts-199001.html
<![CDATA[RNS press release - West Africa Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180618070102_13682713/ Mon, 18 Jun 2018 07:01:02 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180618070102_13682713/ <![CDATA[RNS press release - Exploration Contract Wins ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180618070005_13682656/ Mon, 18 Jun 2018 07:00:05 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180618070005_13682656/ <![CDATA[RNS press release - Notification of Major Interest in Shares ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180521120034_13648870/ Mon, 21 May 2018 12:00:34 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180521120034_13648870/ <![CDATA[Media files - Capital Drilling expanding in West Africa and targeting longer-term contracts ]]> https://www.proactiveinvestors.co.uk/companies/stocktube/9240/capital-drilling-expanding-in-west-africa-and-targeting-longer-term-contracts-9240.html Wed, 09 May 2018 13:12:00 +0100 https://www.proactiveinvestors.co.uk/companies/stocktube/9240/capital-drilling-expanding-in-west-africa-and-targeting-longer-term-contracts-9240.html <![CDATA[RNS press release - TR-1: NOTIFICATION OF MAJOR INTEREST IN SHARES ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180502100201_13627181/ Wed, 02 May 2018 10:02:01 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180502100201_13627181/ <![CDATA[RNS press release - Results of Annual General Meeting ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180427103454_13621685/ Fri, 27 Apr 2018 10:34:54 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180427103454_13621685/ <![CDATA[News - Capital Drilling expands West African presence in first quarter of 2018 ]]> https://www.proactiveinvestors.co.uk/companies/news/195822/capital-drilling-expands-west-african-presence-in-first-quarter-of-2018-195822.html Capital Drilling Ltd (LON:CAPD) said it has expanded its presence in the West Africa region as an additional 12 rigs arrived in the first quarter.

The drilling solutions provider said the 12 new rigs would join 13 already located in Mali and Mauritania, with further rigs scheduled to arrive in the second quarter of the year.

READ: Capital Drilling reveals better than expected financial results

Financially, the group reported an increase in average monthly revenue per operating rig (ARPOR) in the quarter to US$205,000, up 4.6% from the same period last year.

Meanwhile, revenue in the quarter declined 15.8% to US$26.6mln compared to the same period a year ago, which the company said was in line with guidance and reflect efforts to redeploy idle rigs to the high growth West African region.

In its outlook, Capital said it had seen an increase in tendering activity levels in the first quarter, reflecting stronger market conditions and its increased presence in West Africa.

The firm added that it expected more contract wins in the second quarter due to the optimistic conditions, following a three year contract award with Resolute Mining Ltd (ASX:RSG) in Mali on April 11 to operate five rigs at its Syama gold mine.

WATCH: Capital Drilling expanding in West Africa and targeting longer-term contracts

Jamie Boyton, executive chairman of Capital Drilling, said: "Capital Drilling executed its strategy of building its next platform of growth by targeting the fast growing West African market during the last two quarters.  As a result of asset mobilisations, the Company now has over a quarter of its young fleet located in this exciting growth region.

He added: “This transition has been implemented in line with our expectations and we are pleased to see an increase in tendering activity, as well as the award of a three year drilling contract with Resolute in Mali.”

In a note to clients, analysts at FinnCap said: "The temporary dip in quarterly revenues was previously flagged and related to the movement of idle rigs to West Africa, where market conditions and growth opportunities are much stronger. The group expects to win further contracts as the year progresses, which should enable rig utilisation to improve.

They added: "The shares remain significantly under rated due to the Tanzanian regulatory situation and do not reflect the significant operational improvements achieved."

In early trading Thursday, Capital Drilling shares were down 0.5% at 38.8p.

--Adds broker comment and share price--

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Thu, 26 Apr 2018 07:53:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/195822/capital-drilling-expands-west-african-presence-in-first-quarter-of-2018-195822.html
<![CDATA[RNS press release - Q1 Trading Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180426070008_13619065/ Thu, 26 Apr 2018 07:00:08 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180426070008_13619065/ <![CDATA[RNS press release - Contract Win ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180411070002_13599494/ Wed, 11 Apr 2018 07:00:02 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180411070002_13599494/ <![CDATA[RNS press release - Annual Report, Notice of AGM & Proxy Form ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180406070003_13594183/ Fri, 06 Apr 2018 07:00:03 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180406070003_13594183/ <![CDATA[RNS press release - Correction: Issue of Equity, Director/PDMR & TVR ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180405164426_13593980/ Thu, 05 Apr 2018 16:44:26 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180405164426_13593980/ <![CDATA[RNS press release - Issue of Equity, Director/PDMR shareholding & TVR ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180405160450_13593894/ Thu, 05 Apr 2018 16:04:50 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180405160450_13593894/ <![CDATA[RNS press release - Director's Share Purchase ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180319155402_13572488/ Mon, 19 Mar 2018 15:54:02 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180319155402_13572488/ <![CDATA[RNS press release - CORRECTION: Full Year Results ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180316121001_13570321/ Fri, 16 Mar 2018 12:10:01 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180316121001_13570321/ <![CDATA[News - Capital Drilling reveals better than expected financial results ]]> https://www.proactiveinvestors.co.uk/companies/news/193285/capital-drilling-reveals-better-than-expected-financial-results-193285.html Capital Drilling Limited (LON:CAPD) has reported  28% of revenue growth for the twelve months ended December 31, driving a substantial improvement in earnings.

The drill services contractor reported US$24.3mln of earnings (EBITDA), up 86% from the US$13.1mln achieved in the preceding year, after revenues grew to US$119mln from US$93.3mln.

READ: Capital Drilling back in the money and ready to dig deep in 2018

It reported a net profit after tax of US$5.2mln, compared to a US$4.8mln loss in 2016.

Significantly, net operating cash flow improved by 109% to US$20.7mln and the company announced a final dividend of 1.2 cents per share – to be paid on May 28.

The company ended the year with some US$4.9mln of cash.

"Capital Drilling saw a return to profitability in 2017 as the company continued to drive down costs, extend long-term contracts, as well as secure additional long term contracts in the West Africa market,” said Jamie Boyton, Capital Drilling executive chairman.

Benefitting from improvement in mining industry

He added: “Capital Drilling has also benefited from the gradual improvement in market conditions in the mining sector, driving another year of strong revenue growth.”

“Metals prices improved over 2017 and there was a strong increase in capital markets activity, which has translated into increased budgets from mining and exploration companies.”

Boyton also highlighted that the company entered 2018 in “a strong position”, despite  the challenges  being faced by Tanzania, and it is, meanwhile, excited to be increasing its presence in the key West African market for drill services.

Analyst upbeat reaction to results

FinnCap analyst David Buxton described the results as encouraging, highlighting that pre-tax profit was better than forecast.

Similarly, the dividend was also better than expected and it was underpinned by strong operational cash flow.

Buxton, in a note, said: “2017 was a year of transition. Existing production contracts have performed well, while rigs are being moved to West Africa to service new production contracts. Focus on operational efficiencies helped boost margins to 11.4%.”

The analyst added that market sentiment remains focused on Tanzanian issues, which remain unresolved, but, he said investors should also recognise the strong improvement in Capital Drilling’s operational performance.

FinnCap retains an 85p price target, which suggests very significant upside to the current price of 36p.

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Fri, 16 Mar 2018 07:46:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/193285/capital-drilling-reveals-better-than-expected-financial-results-193285.html
<![CDATA[RNS press release - Full Year Results ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180316070002_13569264/ Fri, 16 Mar 2018 07:00:02 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180316070002_13569264/ <![CDATA[News - Capital Drilling back in the money and ready to dig deep in 2018 ]]> https://www.proactiveinvestors.co.uk/companies/news/191406/capital-drilling-back-in-the-money-and-ready-to-dig-deep-in-2018-191406.html The name gives it away a little: Capital Drilling Ltd (LON:CAPD) is an expert in drilling, be that exploration drilling for minerals, grade control or for blast holes.

Its first drilling operation was 13 years ago in Tanzania and, in the same year, it worked on the expansion of the world-class Sukari Gold Mine in Egypt, owned by Centamin.

Today, it boasts a fleet of 20 blast-hole rigs, 42 diamond rigs, 12 reverse circulation rigs, nine multi-purpose rigs, six deep-hole diamond rigs and five underground rigs.

More than half its revenues come from mid-tier operators, although it does work with a significant number of majors too.

Its core areas are eastern and southern Africa, although Capital Drilling is currently working in Chile, Papua New Guinea, Armenia and Pakistan.

Trading conditions more supportive​

Capital returned to profitability in 2017 for the first time in four years following a cyclical downturn.

The fall in commodity prices a few years ago hit mining exploration pretty hard – not good news when you’re contracted by miners to drill for them – but market conditions started to pick up in the middle of 2016 and have continued to be more supportive ever since.

Quarterly revenue amounted to US$27.1mln for the three months to the end of December, representing a slight decrease from the US$27.8mln reported in the same period of last year.

For the full year, revenue totalled US$119.4mln which represents a 28% increase from the preceding year. Capital Drilling finished the year with US$4.9mln of net cash.

“We have seen strong revenue and margin growth in 2017 despite the ongoing pressures and uncertainties of the Tanzanian mining sector, as well as some shorter-term contracts being completed during the period,” said executive chairman Jamie Boyton.

“We look forward to the year ahead with confidence due to a stronger underlying metals market as well as our geographic expansion particularly in West Africa, one of the most dynamic markets for drilling at the moment.

Situation in Tanzania ‘concerning’

The reason for the uncertainty in Tanzania is because of changes to the country’s mining legislation recently brought in by the authorities last year.

Capital has a contract in the East African country with long-term customer Acacia Mining PLC (LON:ACA), the company which seems to have borne the brunt of the legislative changes.

The Tanzanian government has passed bills relating to the sovereignty, contractual terms and amended the Mining & Petroleum Act over the past few months.

This comes on top of a 1% clearing tax recently imposed and a dispute with Acacia over the amount of concentrate the miner is exporting.

All far from lost though in Tanzania…

Clearly Acacia still sees bright future in Tanzania though, which bodes well for Capital.

At the end of last year, the two inked a two-year extension to the drilling contract at the North Mara mine in the country, where Capital is providing blast hole and grade control drilling services.

Capital – which has five rigs at the mine – has been active at the North Mara site since 2008 and the new extension takes the operation through to December 2019. 

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Thu, 08 Feb 2018 15:25:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/191406/capital-drilling-back-in-the-money-and-ready-to-dig-deep-in-2018-191406.html
<![CDATA[News - Capital Drilling highlights “strong revenue and margin” in 2017 ]]> https://www.proactiveinvestors.co.uk/companies/news/190992/capital-drilling-highlights-strong-revenue-and-margin-in-2017-190992.html Capital Drilling Ltd (LON:CAPD) boss Jamie Boyton has highlighted the group’s strong revenue and margin growth in 2017 as the company updated investors on its fourth quarter.

Quarterly revenue amounted to US$27.1mln for the three months to the end of December, representing a slight decrease from the US$27.8mln reported in the same period of last year. For the full year, revenue totalled US$119.4mln which represents a 28% increase from the preceding year.

READ: Capital Drilling contract extended for Acacia’s North Mara mine

Significantly, the company returned to profitability following a four-year cyclical downturn.

“We have seen strong revenue and margin growth in 2017 despite the ongoing pressures and uncertainties of the Tanzanian mining sector, as well as some shorter-term contracts being completed during the period,” said Boyton, Capital Drilling's executive chairman in the company's trading update.

“We look forward to the year ahead with confidence due to a stronger underlying metals market as well as our geographic expansion particularly in West Africa, one of the most dynamic markets for drilling at the moment.

“The group will maintain its focus on cash generation and delivering a quality service to our strong customer base."

Capital Drilling finished the year with US$4.9mln of net cash.

READ: Capital Drilling refinances debt and appoints new CFO

Looking ahead, Capital Drilling maintained its guidance for 2018 with the company anticipating between US$100mln and US$110mln for the year.

The company highlighted that its forecast is underpinned by long term contracts in Tanzania, Egypt, Mauritania and Mali. It does not, however, incorporate new business opportunities in the West African market.

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Thu, 01 Feb 2018 10:13:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/190992/capital-drilling-highlights-strong-revenue-and-margin-in-2017-190992.html
<![CDATA[RNS press release - Q4 2017 Trading Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180201073001_13517582/ Thu, 01 Feb 2018 07:30:01 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20180201073001_13517582/ <![CDATA[News - Capital Drilling contract extended for Acacia’s North Mara mine ]]> https://www.proactiveinvestors.co.uk/companies/news/189107/capital-drilling-contract-extended-for-acacias-north-mara-mine-189107.html Capital Drilling Limited (LON:CAPD) has inked a two-year extension to its contract for Acacia's North Mara mine, where it is providing blast hole and grade control drilling services.

The company has been active at the North Mara site since 2008 and the new extension takes the operation through to December 2019. It currently has five rigs onsite, which are expected to remain in place for the duration of the contract.

READ: Capital Drilling refinances debt and appoints new CFO

"Capital Drilling has been working with Acacia for nine years and we are delighted to continue this relationship as the demand for our services continues,” said chairman Jamie Boyton.

“This contract extension is a testament to the group's solid operational performance and is consistent with our expectations."

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Wed, 20 Dec 2017 13:23:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/189107/capital-drilling-contract-extended-for-acacias-north-mara-mine-189107.html
<![CDATA[RNS press release - Contract Extension at North Mara ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171220103001_13472440/ Wed, 20 Dec 2017 10:30:01 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171220103001_13472440/ <![CDATA[News - Capital Drilling refinances debt and appoints new CFO ]]> https://www.proactiveinvestors.co.uk/companies/news/189029/capital-drilling-refinances-debt-and-appoints-new-cfo-189029.html Capital Drilling Ltd (LON:CAPD) has sealed a new debt refinancing, extending the prior facility by three years.

The new arrangement, with Standard Bank South Africa, is said to have “broadly similar” commercial terms as the previous facility – it bears interest at 5.75% above LIBOR – and it will mature in December 2020.

Additionally, Capital Drilling announced that it has promoted André Koekemoer as the company’s new chief financial officer, replacing incumbent Dewald van Tonder.

Koekemoer has been with the company since 2009 and his most recent role was deputy CFO – he was also previously financial manager, operations commercial manager (latam), and group financial controller.

In a statement, the company said it continues to maintain a strong, net cash balance sheet.

Jamie Boyton, Capital Drilling chairman, in a statement, said: "I would like to take this opportunity to thank Dewald for his contributions to the company and wish him well for the future.

“I would also like to welcome André as CFO. Having been with Capital Drilling since 2009, I look forward to working with him in this new role."

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Tue, 19 Dec 2017 14:01:00 +0000 https://www.proactiveinvestors.co.uk/companies/news/189029/capital-drilling-refinances-debt-and-appoints-new-cfo-189029.html
<![CDATA[RNS press release - Debt Refinancing and Appointment of CFO ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171219123001_13471085/ Tue, 19 Dec 2017 12:30:01 +0000 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171219123001_13471085/ <![CDATA[News - Capital Drilling confirms it had another strong quarter ]]> https://www.proactiveinvestors.co.uk/companies/news/185849/capital-drilling-confirms-it-had-another-strong-quarter-185849.html Capital Drilling Ltd (LON:CAPD) told investors that revenue for the third quarter amounted to US$30mln, up 26% from the same period last year.

The company noted that the revenue tally was similar to the preceding quarter but said it was the group’s strongest third quarter for five years. It added that fleet utilisation for the quarter was 52%, with 48 rigs in use.

READ: Capital Drilling returns to profitability in first half as revenues soar

In a statement, the company declared an interim dividend of 0.5 US cent per share for the first half of the year, to be paid on October 6.

The company noted that it had a strong balance sheet and highlighted that it has enhanced discipline around capital expenditure.

It maintained guidance for the 2017 financial year, and highlighted that it is in active discussions with multiple new and existing customers and is confident of further exploration contract wins in the current period.

WATCH: 'Really good rise in revenue' sees Capital Drilling back in the black

"Capital Drilling delivered a solid performance in Q3, with revenues up 26% compared to the same quarter in 2016,” said Jamie Boyton, Capital Drilling executive chairman.

“Cash generation remained strong enabling a reduction in gross debt, payment of the Group's interim dividend, in addition to payment of the outstanding cash consideration to earn 50% of A2 Global Ventures.

“Market conditions have continued with the positive momentum in 2017 and shown further signs of strength in this current quarter.”

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Thu, 19 Oct 2017 07:52:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/185849/capital-drilling-confirms-it-had-another-strong-quarter-185849.html
<![CDATA[RNS press release - Q3 Trading Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171019070005_13401651/ Thu, 19 Oct 2017 07:00:05 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171019070005_13401651/ <![CDATA[RNS press release - Board Changes ]]> https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171002070006_13381601/ Mon, 02 Oct 2017 07:00:06 +0100 https://www.proactiveinvestors.co.uk/companies/rns/3747/LSE20171002070006_13381601/