Foraco International (FAR) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue was $69.1 million, or $72 million excluding forex, down from $77 million in Q2 2024, with Asia Pacific and EMEA growing while North and South America declined due to program discontinuations and contract delays.

• EBITDA doubled sequentially from Q1 and reached $15 million excluding one-off costs (21.7% of revenue), with net profit at $6 million (9% margin).

• Cost control and operational efficiency maintained strong margins despite lower revenue and one-off reorganization costs.

• New three-year, $34 million contract with Glencore at Lomas Bayas copper mine in Chile commenced, supporting future growth.

• Exposure to gold, copper, and water increased, with proprietary rig deployments supporting long-term contracts.

Financial highlights

• Q2 2025 revenue: $69.1 million ($72 million at prior year FX), down 11% year-over-year; H1 2025 revenue: $124.1 million, down 20%.

• EBITDA: $15 million excluding one-off costs (21.7% margin), vs. $17 million (23%) in Q2 2024.

• Gross margin: $14.1 million (20.5% of revenue), or $15.1 million (21.9%) excluding one-offs, vs. $18 million (23%) in Q2 2024.

• SG&A decreased 19% to $4.7 million; as a percentage of revenue, stable at 7%.

• Q2 2025 net profit was $6 million (9% margin), down from $7.8 million (10%) in Q2 2024.

Outlook and guidance

• Second half of 2025 expected to improve, with robust tender pipeline, new US contracts, and increased urgency from clients.

• Latin America outlook positive, with new contracts and improved order book in Chile and Brazil.

• No further one-off reorganization costs expected in Q3 or Q4.

• CapEx to continue for proprietary rigs and project-specific investments, but no speculative CapEx planned.

• Strategy emphasizes organic growth, targeted acquisitions, and expansion in stable jurisdictions and water-related drilling.