Arabian Drilling Company (2381) Q3 2025 earnings summary

Executive summary

• Revenue for the first nine months of 2025 was SAR 2.61 billion, down 5.8% year-over-year, mainly due to reduced offshore and land activities and rig suspensions.

• Net income dropped 70.8% year-over-year to SAR 73.3 million, with a Q3 net loss of SAR 9.4 million, impacted by lower rig utilization and a one-off deferred tax provision.

• Backlog increased 6.8% year-over-year to SAR 10.98 billion, with a 3.2x book-to-bill ratio and 2.4 years average contract tenor.

• Five rigs (three land, two offshore) are scheduled for reactivation in Q1 2026, with the first international contract in the GCC to commence.

• Both land and offshore segments experienced lower profitability, with no impairment losses recognized despite rig suspensions.

Financial highlights

• EBITDA margin was 35.1% for Q3 and 37.4% year-to-date, with EBITDA down 15.1% year-over-year.

• Net income dropped 70.8% year-over-year, further impacted by higher depreciation and deferred tax from new assets.

• Operating cash flow declined 17.1% year-over-year to SAR 929 million.

• CapEx was down 60.2% year-over-year, reflecting completion of unconventional rig investments.

• Net debt increased marginally to SAR 2.7 billion, with net debt/EBITDA at 2x.

Outlook and guidance

• Q4 2025 revenue is expected to remain flat or decline up to 5% due to lingering effects of rig suspensions.

• Utilization rate projected to recover to 80% by Q2 2026, with offshore utilization reaching 100%.

• CapEx for 2025 revised down to SAR 800 million, including rig resumptions.

• Management expects suspended rigs to resume operations within 12 months.