Canada's Major Drilling Q1 revenue up 22% on higher rig deployments, pricing

Major Drilling International

02/09/2026 22:12

Overview
Canada mining drilling firm's fiscal Q1 revenue rose 22% yr/yr, beating analyst expectations
Adjusted gross margin declined yr/yr due to higher labor and ramp-up costs
Net earnings climbed 44% yr/yr, driven by increased activity and new contracts

Outlook
Company expects continued gradual rig deployment at higher prices as exploration budgets rise
Company anticipates ongoing labour shortages, especially in Canada and U.S., to temporarily impact productivity
Major Drilling expects pricing improvements on new contracts and renewals to offset cost increases and improve margins

Result Drivers
RIG DEPLOYMENT & PRICING - Co said record revenue was driven by additional rigs in the field and a gradually improving pricing environment
INCREASED EXPLORATION BUDGETS - Accelerated activity in Canada and US due to higher exploration budgets by senior mining customers and expanded drilling programs
LABOR & TRAINING COSTS - Adjusted gross margin declined yr/yr due to wage adjustments, training costs in tight North American labor market, ramp-up costs and weather disruptions in Chile

Company press release: ID:nGNX15Wy5L

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q1 Revenue
Beat
C$277.30 mln
C$261.08 mln (3 Analysts)
Q1 EPS
 
C$0.18
 
Q1 Net Income
 
C$14.50 mln
 
Q1 Adjusted Gross Margin
 
24.00%
 
Q1 EBITDA
 
C$37.20 mln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"
The average consensus recommendation for the mining support services & equipment peer group is "buy"
Wall Street's median 12-month price target for Major Drilling Group International Inc is C$21.00, about 27.8% above its September 1 closing price of C$16.43
The stock recently traded at 23 times the next 12-month earnings vs. a P/E of 20 three months ago

Reuters Recommended Reads
Aug 31 - Chile's copper output declines 9.4% in July hit by severe weather
Sept 1 - Bombardier to buy Canadian factory from supplier Mitsubishi Heavy Industries
Sept 1 - Canadian factory PMI dips in August but shows sector still expanding

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)