Pason Reports Third Quarter 2024 Results and Declares Quarterly Dividend

CALGARY, AB, Nov. 7, 2024 /CNW/ - Pason Systems Inc. ("Pason" or the "Company") (TSX:PSI) announced today its 2024 third quarter results and the declaration of a quarterly dividend. The following news release should be read in conjunction with the Company's Management Discussion and Analysis ("MD&A"), the unaudited Condensed Consolidated Interim Financial Statements and related notes for the three and nine months ended September 30, 2024, as well as the Annual Information Form for the year ended December 31, 2023. All of these documents are available on SEDAR+ at www.sedarplus.ca.

Financial Highlights

Three Months Ended September 30,

Nine Months Ended September 30,

2024

2023

Change

2024

2023

Change

(CDN 000s, except per share data)

($)

($)

( %)

($)

($)

( %)

North American Drilling Revenue

74,141

72,163

3

211,510

219,256

(4)

International Drilling Revenue

15,327

15,313



45,243

45,883

(1)

Completions Revenue (3)

12,512



nmf

38,963



nmf

Solar and Energy Storage Revenue   

3,909

5,618

(30)

10,788

10,875

(1)

Total Revenue

105,889

93,094

14

306,504

276,014

11

Adjusted EBITDA (1)

44,148

42,281

4

119,708

132,578

(10)

As a % of revenue

41.7

45.4

       (370)  bps

39.1

48.0

       (890)  bps

Funds flow from operations

36,119

40,233

(10)

99,009

117,017

(15)

Per share, basic

0.45

0.50

(9)

1.24

1.45

(14)

Per share, diluted

0.45

0.50

(9)

1.24

1.45

(14)

Cash from operating activities

30,375

31,698

(4)

87,365

107,621

(19)

Net capital expenditures (2)

13,721

6,682

105

50,947

29,907

70

Free cash flow (1)

16,654

25,016

(33)

36,418

77,714

(53)

Cash dividends declared (per share)

0.13

0.12

8

0.39

0.36

8

Net income

23,717

27,399

(13)

103,124

87,815

17

Net income attributable to Pason

24,158

27,732

(13)

104,577

89,044

17

Per share, basic

0.30

0.35

(13)

1.31

1.10

19

Per share, diluted

0.30

0.35

(13)

1.31

1.10

19

As at

September 30, 2024

December 31, 2023

Change

(CDN 000s)

($)

($)

( %)

Cash and cash equivalents

70,848

171,773

(59)

Short-term investments

3,101



nmf

Total Cash (1)

73,949

171,773

(57)

Working capital

118,059

212,561

(44)

Total interest bearing debt







Shares outstanding end of period (#)

79,621,109

79,685,025

nmf

(1)

Non-GAAP and supplementary financial measures are defined under Non-GAAP Financial Measures in this press release.

(2)

Includes additions to property, plant, and equipment and development costs, net of proceeds on disposal from Pason's Condensed Consolidated Interim Statements of Cash Flows

(3)

The Completions segment includes results generated by IWS, which were not part of the Company's consolidated reporting group until January 1, 2024 following the IWS Acquisition

Pason generated $105.9 million in consolidated revenue in the third quarter of 2024, representing a 14% increase from the $93.1 million generated in the comparative period of 2023 and a result that continues to outpace the changes in underlying North American industry drilling activity.

The North American Drilling business unit generated $74.1 million of revenue in the third quarter of 2024, a 3% increase over the comparative period of 2023 despite a 5% decline in North American industry drilling activity. Pason's Revenue per Industry Day in the third quarter of 2024 of $1,058 increased by 9% from the comparative 2023 period. Revenue per Industry Day in the current quarter represents increased product adoption across Pason's technology offering and benefited from strength in the US dollar versus the Canadian dollar. Segment gross profit of $45.5 million during the third quarter of 2024 compared to $44.2 million in the comparative period of 2023 demonstrates the Company's ability to outpace industry activity levels on a mostly fixed cost base.

The International Drilling business unit generated $15.3 million of revenue in the third quarter of 2024, a level comparable to the third quarter of 2023. Gross profit was impacted by higher levels of depreciation and amortization expense in the current quarter and declined slightly from $7.9 million in Q3 2023 to $7.6 million in Q3 2024.

The Company's new Completions business unit, formed after the acquisition of IWS on January 1, 2024, generated $12.5 million in revenue while averaging 28 IWS Active Jobs with Revenue per IWS day of $4,868 through very challenging industry conditions in the third quarter. Segment gross profit of $0.3 million in the quarter includes $5.1 million of depreciation and amortization expense, of which $2.2 million relates to amortization expense on intangible assets acquired through the IWS Acquisition.

Revenue generated by the Solar and Energy Storage business unit was $3.9 million, a $1.7 million decrease from the comparative period in 2023 due to the timing of revenue recognized on the delivery of control systems. Resulting segment gross profit was $0.4 million for the third quarter of 2024 compared to a segment gross ...