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.
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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.”