Ensign Energy reports lower Q4 drilling activity, revenue as slow recovery continues

·2 min read

CALGARY — Drilling company Ensign Energy Services Inc. says oilpatch activity in its Canadian and U.S. operations is staging a slow recovery from a deep slump in 2020.

The Calgary-based company says it earned net income of $3.1 million or two cents per share on revenue of $201 million in the last three months of 2020, compared with a net loss of $71.6 million on revenue of $375 million in the year-earlier period.

Analysts had expected a net loss of $57.9 million on revenue of $197 million, according to financial data firm Refinitiv.

Ensign's fourth-quarter revenue slumped 43 per cent in Canada compared with the same period in 2019, by 52 per cent in the U.S. and by 36 per cent in its international arm, which operates in South America, the Middle East and Australia.

The driller says it had a net loss attributed to shareholders of $79.3 million for 2020 as a whole on revenue of $936.8 million, compared with a loss of $163 million on revenue of $1.6 billion in 2019.

It said it received $12.5 million in 2020 from the Canada Emergency Wage Subsidy program and a $6.9-million wage subsidy from the Australian government.

"The outlook for oilfield services has recently and meaningfully improved as oil and natural gas industry fundamentals continue to recover," Ensign said in a news release that notes recent improvements in benchmark world oil prices.

"In addition, the rollout of COVID-19 vaccines globally in combination with economic stimulus actions have driven oil demand improvements."

The outlook echoes that offered by rival Precision Drilling Corp., which last month reported a fourth-quarter loss of $37.5 million as its revenue fell 46 per cent compared with a year earlier.

This report by The Canadian Press was first published March 5, 2021.

Companies in this story: (TSX:ESI, TSX:PD)

The Canadian Press