Arabian Drilling Company (2381) Q4 2025 earnings summary

Executive summary

• FY 2025 revenue was SAR 3.4 billion, down 5.1% year-on-year due to reduced offshore and land activity, partially offset by strong unconventional operations.

• Q4 2025 revenue was SAR 824 million, down 1.3% sequentially, in line with guidance.

• Backlog reached a record SAR 12.4 billion, up 20% year-on-year, supporting future revenue visibility.

• First international contract commenced, marking a milestone in geographic expansion.

• Utilization improved to 75%, with 45 active rigs at year-end; offshore utilization expected to reach 100% in early Q2 2026.

Financial highlights

• FY 2025 EBITDA was SAR 1.24 billion (36.1% margin), down 17.8% year-on-year; adjusted net income fell 90.8% to SAR 39 million.

• FY 2025 net loss was SAR 75 million, compared to a profit of SAR 321 million in FY 2024.

• FY 2025 CapEx was SAR 746 million, down 61% year-on-year; Q4 CapEx was SAR 162 million, mainly for rig reactivation.

• Year-end cash position was SAR 595.3 million, up SAR 14 million from 2024.

• Net debt stable at SAR 2.4 billion, with net debt to EBITDA ratio at 2x.

Outlook and guidance

• Revenue expected to improve slightly in Q1 2026, with further gains from Q2 as more rigs return to operation.

• Offshore utilization projected to reach 100% in early Q2 2026; total utilization to rise above 80% by end of Q1.

• CapEx guidance for 2026 is SAR 750 million, with SAR 150 million allocated to rig reactivation.

• Margins anticipated to improve as reactivated rigs reach full operational impact in H1 2026.

• Management confident in renewing 2026 expiring contracts and expects majority of idle rigs to return to service.