Independence Contract Drilling Inc (ICD) Reports Q3 2023 Financial Results
Net loss of $7.6 million, or $0.54 per share
Adjusted net loss of $5.2 million, or $0.37 per share
Adjusted EBITDA of $12.9 million
Revenues of $44.2 million
Independence Contract Drilling Inc (NYSE:ICD) released its financial results for the third quarter ended September 30, 2023, on November 1, 2023. The company reported a net loss of $7.6 million, or $0.54 per share, and an adjusted net loss of $5.2 million, or $0.37 per share. The adjusted EBITDA for the quarter was $12.9 million. The company's revenues for the quarter stood at $44.2 million.
Financial Performance
ICD's third-quarter revenues of $44.2 million showed a decrease compared to $49.1 million in the third quarter of 2022, and $56.4 million in the second quarter of 2023. The company reported operating costs of $27.5 million, compared to $31.4 million in the third quarter of 2022, and $33.8 million in the second quarter of 2023. The fully burdened operating costs were $18,920 per day in the third quarter of 2023, compared to $17,305 in the third quarter of 2022, and $19,005 in the second quarter of 2023.
CEO Commentary
The third quarter of 2023 represented an inflection point for ICD. First and most important, the third quarter represents the low point for ICD operating utilization driven by the most recent commodity downturn. The quarter also represented the end of the transition of rigs from our Haynesville to our Permian market and the elevated rig churn associated with repositioning our fleet with customers with longer term drilling programs. While these items weighed on our second and third quarter financial results, we believe the transition of rigs between basins and customers has positioned ICD well for the remainder of 2023 and fiscal 2024." - Chief Executive Officer Anthony Gallegos
Operational Results
In the third quarter of 2023, operating days decreased sequentially by 10% compared to the second quarter of 2023. The Company's marketed fleet operated at 51% utilization and recorded 1,229 revenue days. Operating revenues in the third quarter of 2023 totaled $44.2 million, compared to $49.1 million in the third quarter of 2022 and $56.4 million in the second quarter of 2023.
Capital Expenditures and Liquidity Update
As of September 30, 2023, the Company had cash on hand of $6.0 million and a revolving line of credit with availability of $15.7 million, and net working capital of $5.8 million. The Company reported adjusted net debt as of September 30, 2023 of $183.2 million.
Outlook
The Company currently expects to operate approximately 14.5 average rigs during the fourth quarter of 2023 and exit 2023 with 17 to 18 rigs under contract. The Company's backlog of drilling contracts with original terms of six months or longer is $46.8 million.
Explore the complete 8-K earnings release (here) from Independence Contract Drilling Inc for further details.
This article first appeared on GuruFocus.
