Canada's McCoy Global Q2 revenue falls on Middle East disruptions

McCoy Global

07/08/2026 12:15

Overview
Canada well construction automation firm's Q2 revenue fell 28% yr/yr due to Middle East disruptions
Adjusted EBITDA for Q2 dropped 60% yr/yr, reflecting lower shipment volumes and strategic pricing
Company improved liquidity, ending Q2 with no debt and C$8.3 mln net cash

Outlook
Company expects logistics disruptions and lower order activity to continue through 2026 due to Middle East instability
About 30% of backlog is exposed to Middle East, with delivery timing and revenue recognition at risk
Capital expenditures for remainder of 2026 expected to be up to US$1.7 mln, focused on technology and rental equipment

Result Drivers
MIDDLE EAST DISRUPTIONS - Co said revenue and earnings fell due to geopolitical instability in the Middle East and suspension of shipping through the Strait of Hormuz, causing delayed shipments and deferred customer purchases
LOWER SHIPMENT VOLUMES - Lower shipment volumes and reduced absorption of fixed costs weighed on profitability, per management
STRATEGIC PRICING - Strategic pricing on certain products to convert inventory into cash and expand installed base negatively affected gross margin

Company press release: ID:nCNWs1gRqa

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Revenue
Beat
C$17.24 mln
C$11 mln (2 Analysts)
Q2 Net Income
 
C$113,000
 
Q2 Adjusted EBITDA
Beat
C$1.93 mln
C$550,000 (2 Analysts)
Q2 EBITDA
 
C$1.16 mln
 
Q2 Gross Profit
 
C$3.51 mln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"
The average consensus recommendation for the oil related services and equipment peer group is "buy"
Wall Street's median 12-month price target for McCoy Global Inc. is C$5.25, about 140.8% above its August 6 closing price of C$2.18
The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 9 three months ago

Reuters Recommended Reads
Aug 5 - Tenaris Q2 net sales fall on postponed shipments to Middle East customers
Aug 5 - ShaMaran Petroleum Q2 revenue falls on field shut-ins due to regional security concerns, the Iran war
Aug 7 - Canada's Ensign Energy Q2 revenue rises on increased drilling activity

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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.)