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Precision Drilling announces C$125 million debt reduction, plans more
By Angela McDaniels
Tacoma, Wash., June 4 – Precision Drilling Corp. said it has reduced its debt by about C$125 million so far this year, reaching the midpoint of its 2019 targeted debt reduction range.
Earlier this year, Precision set its 2019 debt repayment target at C$100 million to C$150 million and increased its longer-term debt reduction target range by C$100 million with a new target range of C$400 million to C$600 million by the end of 2021, inclusive of debt repayments in 2018.
“Precision continues to utilize strong free cash flow to reduce financial leverage and deliver on both short- and long-term debt reduction targets,” chief financial officer Carey Ford said in a company news release.
“We have reduced debt by approximately C$300 million since the beginning of 2018, and with our 2019 capital expenditure plan front-end loaded, reduced interest expense and a positive free cash flow outlook, we expect to be in a position to further reduce debt during the second half of the year, reaching or exceeding the high end of our 2019 debt reduction target.”
As of Tuesday, the company had US$1.17 billion of senior notes outstanding, including US$116 million of 6½% senior notes due Dec. 15, 2021, US$350 million of 7¾% senior notes due Dec. 15, 2023, US$334 million of 5¼% senior notes due Nov. 15, 2024 and US$374 million of 7 1/8% senior notes due Jan. 15, 2026.
The amount is down from US$1.27 billion of outstanding senior notes as of Dec. 31 and US$1.4 billion as of Dec. 31, 2017.
Precision estimated its cash balance at C$70 million as of June 30, and its credit facilities are undrawn, excluding letters of credit.
Precision Drilling is a Calgary, Alta., provider of services to the oil and gas industry, including contract drilling rigs, directional drilling services, well service and snubbing rigs, camps, rental equipment and wastewater treatment units.
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