Drillcon (DRIL) Q3 2024 earnings summary

Executive summary

• Net sales for Q3 2024 were 81 MSEK, down 33% year-over-year, mainly due to discontinued Americas operations and production issues in Iberia and Scandinavia.

• Adjusted EBIT for Q3 was 1.2 MSEK (12.8), with reported EBIT at -0.9 MSEK; EBITDA was 6.0 MSEK (20.3).

• Nine-month net sales were 304 MSEK (357), with adjusted EBIT at 18.3 MSEK (18.1) and net income at 8.5 MSEK (11.5).

• Americas segment was fully discontinued by June 2024; legal actions initiated against former Iberia CEO for financial damages.

• Extraordinary legal costs of -2.0 MSEK impacted Q3 net result.

Financial highlights

• Q3 net sales: 81 MSEK (120), EBITDA: 6.0 MSEK (20.3), EBIT: -0.9 MSEK (12.8), adjusted EBIT: 1.2 MSEK (12.8).

• Nine-month net sales: 304 MSEK (357), EBITDA: 34.0 MSEK (40.2), EBIT: 11.4 MSEK (18.1), adjusted EBIT: 18.3 MSEK (18.1).

• Q3 net income: -0.5 MSEK (7.2); nine-month net income: 8.5 MSEK (11.5).

• Q3 operating cash flow: 7.0 MSEK (7.9); nine-month operating cash flow: 19.6 MSEK (23.7).

• EPS Q3: -0.01 (0.16); nine months: 0.19 (0.26).

Outlook and guidance

• Production in Ireland expected to restart no earlier than late Q1 2025.

• Short-term demand and investment appetite remain stable, but Q4 will be affected by ongoing Iberia challenges.

• Underlying customer demand and investment willingness remain good despite increased competition.