Trainees Dan Brook and Bradley Williams are directed by instructor Clint Dyck while training to lay down drill pipe on a rig floor, at Precision Drilling in Nisku, on January 20, 2016. (File photo by THE CANADIAN PRESS)

Trainees Dan Brook and Bradley Williams are directed by instructor Clint Dyck while training to lay down drill pipe on a rig floor, at Precision Drilling in Nisku, on January 20, 2016. (File photo by THE CANADIAN PRESS)

Precision Drilling reports $5.3M Q1 loss, warns of drop in demand well into 2021

Pandemic and the oil price war to blame

CALGARY — Precision Drilling Corp. reported a loss in its first quarter and warned that it expected a significant and sustained drop in customer demand for oil and gas services well into next year as a result of the recent plunge in oil prices.

The drilling company says the COVID-19 pandemic and the oil price war between Russia and Saudi Arabia has resulted in the deepest downturn the oil and gas services industry has ever experienced.

Precision says it lost $5.3 million or two cents per diluted share for the quarter ended March 31 compared with a profit of $25.0 million or eight cents per diluted share a year earlier.

Revenue totalled $379.5 million, down from $434.0 million in the first quarter of 2019.

Analysts on average had expected a loss of three cents per share for the quarter and $379.4 million in revenue, according to financial markets data firm Refinitiv.

Last month, Precision Drilling reduced staff, cut salaries and lowered its capital spending plan in response to the COVID-19 pandemic.

This report by The Canadian Press was first published April 30, 2020.

oil and gas