Precision Drilling Announces Credit Facility Extension and $150 Million Total Debt Reduction in 2018
December 13 2018 - 6:00AM
This news release contains "forward-looking
information and statements" within the meaning of applicable
securities laws. For important information with respect to such
forward-looking information and statements and the further
assumptions and risks to which they are subject, see the
"Cautionary Statement Regarding Forward-Looking Information and
Statements" later in this news release.
Precision Drilling Corporation (“Precision” or “the Company”)
(TSX:PD; NYSE:PDS) announced today the completion with our lenders
of a one-year maturity extension of our senior credit
facility to November 2022. Precision has also completed an
additional $34 million in open market purchases of its 5.25% senior
notes due 2024 which will bring total debt repayments for year-end
2018 to approximately $150 million, exceeding the high end of our
2018 targeted debt reduction range of $75 million to $125
million. Debt repayments in 2018 are funded from free cash
flow and provide annualized interest savings of
approximately $9 million. The Company expects its year end
cash balance to be approximately $90 million, which coupled with
its undrawn credit facilities, will provide Precision with
approximately $780 million of liquidity going into 2019.
Precision’s President and CEO Kevin Neveu
stated: “I am very pleased to end the year with a strong liquidity
position after having exceeded our stated debt reduction targets
for 2018. We remain committed to our deleveraging plan of reducing
debt by $300 million to $500 million between 2018 and 2021.
With the $150 million debt reduction progress achieved in 2018, we
are well on our way to reaching the high end of our target range
over the next three years.” concluded Mr. Neveu.
CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING INFORMATION AND STATEMENTS
Certain statements contained in this report,
including statements that contain words such as "could", "should",
"can", "anticipate", "estimate", "intend", "plan", "expect",
"believe", "will", "may", "continue", "project", "potential" and
similar expressions and statements relating to matters that are not
historical facts constitute "forward-looking information" within
the meaning of applicable Canadian securities legislation and
"forward-looking statements" within the meaning of the "safe
harbor" provisions of the United States Private Securities
Litigation Reform Act of 1995 (collectively, "forward-looking
information and statements").
In particular, forward looking information and
statements include, but are not limited to, the following:
- anticipated future debt reduction;
- year end debt repayment total and the use of cash on hand;
- anticipated annualized interest savings; and
- anticipated cash balance and liquidity at December 31,
2018.
These forward-looking information and statements
are based on certain assumptions and analysis made by Precision in
light of our experience and our perception of historical trends,
current conditions, expected future developments and other factors
we believe are appropriate under the circumstances. These include,
among other things:
- the fluctuation in oil prices may pressure customers into
reducing or limiting their drilling budgets;
- the status of current negotiations with our customers and
vendors;
- customer focus on safety performance;
- existing term contracts are neither renewed nor terminated
prematurely;
- our ability to deliver rigs to customers on a timely basis;
and
- the general stability of the economic and political
environments in the jurisdictions where we operate.
Undue reliance should not be placed on
forward-looking information and statements. Whether actual results,
performance or achievements will conform to our expectations and
predictions is subject to a number of known and unknown risks and
uncertainties which could cause actual results to differ materially
from our expectations. Such risks and uncertainties include, but
are not limited to:
- volatility in the price and demand
for oil and natural gas;
- fluctuations in the demand for
contract drilling, well servicing and ancillary oilfield
services;
- our customers’ inability to obtain
adequate credit or financing to support their drilling and
production activity;
- changes in drilling and well
servicing technology which could reduce demand for certain rigs or
put us at a competitive disadvantage;
- shortages, delays and interruptions
in the delivery of equipment supplies and other key inputs;
- the effects of seasonal and weather
conditions on operations and facilities;
- the availability of qualified
personnel and management;
- a decline in our safety performance
which could result in lower demand for our services;
- changes in environmental laws and
regulations such as increased regulation of hydraulic fracturing or
restrictions on the burning of fossil fuels and greenhouse gas
emissions, which could have an adverse impact on the demand for oil
and gas;
- terrorism, social, civil and
political unrest in the foreign jurisdictions where we
operate;
- fluctuations in foreign exchange,
interest rates and tax rates; and
- other unforeseen conditions which
could impact the use of services supplied by Precision and
Precision’s ability to respond to such conditions.
Readers are cautioned that the forgoing list of
risk factors is not exhaustive. Additional information on these and
other factors that could affect our business, operations or
financial results are included in reports on file with applicable
securities regulatory authorities, including but not limited to
Precision’s Annual Information Form for the year ended December 31,
2017, which may be accessed on Precision’s SEDAR profile at
www.sedar.com or under Precision’s EDGAR profile at www.sec.gov.
The forward-looking information and statements contained in this
news release are made as of the date hereof and Precision
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, except as required by
law.
About Precision
Precision is a leading provider of safe and High
Performance, High Value services to the oil and gas industry.
Precision provides customers with access to an extensive fleet of
contract drilling rigs, directional drilling services, well service
and snubbing rigs, camps, rental equipment, and wastewater
treatment units backed by a comprehensive mix of technical support
services and skilled, experienced personnel.
Precision is headquartered in Calgary, Alberta,
Canada. Precision is listed on the Toronto Stock Exchange under the
trading symbol “PD” and on the New York Stock Exchange under the
trading symbol “PDS”.
For further information, please contact:
Carey Ford, CFASenior Vice President and Chief
Financial Officer713.435.6111
Ashley Connolly, CFAManager, Investor
Relations403.716.4725
Precision Drilling Corporation800, 525 - 8th
Avenue S.W.Calgary, Alberta, Canada T2P 1G1Website:
www.precisiondrilling.com
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