Major Drilling Announces Third Quarter 2025 Results
NEWS RELEASE
Major Drilling Announces Third Quarter 2025 Results
MONCTON, New Brunswick (March 6, 2025) – Major Drilling Group International Inc. (“Major Drilling” or the
“Company”) (TSX: MDI), a leading provider of specialized drilling services to the mining sector, today reported results for
the third quarter of fiscal 2025, ended January 31, 2025.
Quarterly Highlights:
•Revenue of $160.7 million, up 21.0% from the $132.8 million recorded in the same quarter last year.
•Adjusted gross margin (1) of 19.5% as the Company completed maintenance & repair programs, as is typical
during the seasonally weaker quarter, in preparation for increased activity levels through calendar 2025.
•Completed the acquisition of Explomin, increasing the Company’s exposure to a top-tier copper jurisdiction and
further expanding its list of senior customers.
•Ended the quarter with $11.4 million in net cash (1) despite closing the largest acquisition in Company history.
•Achieved the best quarterly safety record in Company history with a TRIFR of 0.38.
“Through the third quarter, which is traditionally the weakest of our fiscal year as customers pause operations for the
holiday season, the Company successfully completed the acquisition of Explomin Perforaciones and subsidiaries
("Explomin") while maintaining relatively stable revenue from existing operations. As we move through the budgeting
season, there have been several positive indications with respect to exploration spending, most notably from the larger
exploration budgets outlined by several of our senior customers in conjunction with their year-end results. This is further
supported by an increase in the number of junior financings completed over the first two months of the year,” said Denis
Larocque, President and CEO of Major Drilling.
“The completion of the Explomin acquisition marks another transformational event in the Company's history, expanding
our senior customer base in a region that has been on our radar for a number of years. Explomin’s long-term contracts with
both surface and underground operations, provide diversity and stability to our revenue mix, while at slightly lower
margins. Its strong brand and reputation throughout the countries in which it operates matches many of the qualities and
attributes that Major Drilling has become known for,” Mr. Larocque continued.
“While we prepare for what is expected to be a busier calendar year, we also remain proud of our industry-leading safety
record, as we achieved the lowest quarterly TRIFR ("Total Recordable Injury Frequency Rate") in Company history, coming
in at 0.38 at the end of the quarter. This continued focus on safety was further demonstrated by our recent receipt of the
‘Safe Day Everyday Gold Award’ from the AME-BC, together with the PDAC and the CDDA in January,” continued Mr.
Larocque.
“The Company generated $160.7 million in revenue in the quarter, a 21.0% increase when compared to the same period in
the prior year. Excluding the acquisition of Explomin, which was completed at the beginning of the quarter, revenue totaled
$127.9 million, representing a decrease of 3.7% when compared to the same period last year. The Company’s balance sheet
remains extremely strong with net cash of $11.4 million, despite the $84 million cash outlay, and $21 million contingent
consideration recognized on closing the largest acquisition in the Company’s history during the quarter. We continue to
invest in our industry-leading fleet and support gear, spending $12.6 million on capital expenditures during the quarter,
including 4 new drills, while disposing of 1 older, less efficient drill, bringing the total fleet size to 705 rigs after including
92 rigs acquired through the Explomin transaction,” said Ian Ross, CFO of Major Drilling.
“While the positive indicators related to global exploration spending point to a more optimistic outlook for calendar 2025,
the year started off at a slower pace relative to the prior year’s ramp-up as a result of mobilization delays due to a variety
of reasons, including permitting delays, inclement weather, and slower start-ups at various projects. While these delays are
expected to impact activity levels at the start of fiscal Q4, we expect the ramp-up to continue, matching last year’s activity
levels in the latter part of March and into April. In preparation for this anticipated ramp-up, the retention of experienced
crews remains a key strategic focus, which is expected to have an impact on margins early in the quarter,” concluded Mr.
Larocque.
In millions of Canadian dollars (except
earnings per share) Q3 2025 Q3 2024 YTD 2025 YTD 2024
Revenue $ 160.7 $ 132.8 $ 540.0 $ 538.7
Gross margin 10.3% 14.2% 19.0% 22.3%
Adjusted gross margin (1) 19.5% 23.4% 26.6% 28.8%
EBITDA (1) 7.8 11.4 80.8 95.2
As percentage of revenue 4.9% 8.5% 15.0% 17.7%
Net earnings (loss) (9.1) (2.3) 24.9 43.2
Earnings (loss) per share (0.11) (0.03) 0.30 0.52
(1) See “Non-IFRS Financial Measures”
Third Quarter Ended January 31, 2025
Total revenue for the quarter was $160.7 million, up 21.0% from revenue of $132.8 million recorded in the same quarter
last year. Excluding Explomin, revenue for the quarter would have been $127.9 million, down 3.7% from the same quarter
last year. The favourable foreign exchange translation impact on revenue, when compared to the effective rates for the
previous year, was approximately $3 million, while the impact on net earnings was minimal as expenditures in foreign
jurisdictions tend to be in the same currency as revenue.
Revenue for the quarter from Canada - U.S. drilling operations decreased by 31.0% to $43.0 million, compared to the same
period last year. The decrease was mainly due to a seasonal shutdown of certain drill programs earlier than in previous
years, with fewer program extensions, along with a more competitive environment due to a lack of junior financings.
South and Central American revenue increased by 121.5% to $75.3 million for the quarter, compared to the same quarter
last year, driven by the addition of Explomin operations. Excluding Explomin, revenue increased by 25%, compared to the
same period last year, driven by elevated levels of activity in Chile, which were partially offset by slowdowns in Argentina
due to decreased activity levels.
Australasian and African revenue increased by 15.8% to $42.4 million, compared to the same period last year. Growth in
the region was driven by continued strength in Australia where increased activity levels led to shorter holiday shutdowns
at some projects when compared to last year, while activity levels in Mongolia also remain robust.
Gross margin percentage for the quarter was 10.3%, compared to 14.2% for the same period last year. Depreciation expense
totaling $14.8 million is included in direct costs for the current quarter, versus $12.3 million in the same quarter last year.
Adjusted gross margin, which excludes depreciation expense, was 19.5% for the quarter, compared to 23.4% for the same
period last year. The decrease in margins from the prior year was mainly attributable to reduced activity levels in certain
regions, increased mobilization costs, retention of experienced crews, and annual preventative maintenance programs,
which are completed during the seasonal slowdown while the drills are idle for the holiday season.
General and administrative costs were $22.8 million, an increase of $5.7 million compared to the same quarter last year.
The increase from the prior year was driven by the addition of Explomin, annual inflationary wage adjustments and
amortization of the intangible asset recognized as part of the Explomin acquisition.
Foreign exchange loss was $1.6 million, compared to a loss of $2.3 million for the same quarter last year. While the
Company's reporting currency is the Canadian dollar, various jurisdictions have net monetary assets or liabilities exposed
to various other currencies.
The income tax provision for the quarter was a recovery of $0.8 million, compared to an expense of $0.9 million for the prior
year period. The income tax provision was impacted by non-tax affected losses in certain regions.
Net loss was $9.1 million or $0.11 per share ($0.11 per share diluted) for the quarter, compared to net loss of $2.3 million
or $0.03 per share ($0.03 per share diluted) for the prior year quarter.
Non-IFRS Financial Measures
The Company’s financial data has been prepared in accordance with IFRS, with the exception of certain financial measures
detailed below. The measures below have been used consistently by the Company’s management team in assessing
operational performance on both segmented and consolidated levels, and in assessing the Company’s financial strength.
The Company believes these non-IFRS financial measures are key, for both management and investors, in evaluating
performance at a consolidated level and are commonly reported and widely used by investors and lending institutions as
indicators of a company’s operating performance and ability to incur and service debt, and as a valuation metric. These
measures do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similarly titled
measures presented by other publicly traded companies and should not be construed as an alternative to other financial
measures determined in accordance with IFRS.
EBITDA - earnings before interest, taxes, depreciation, and amortization:
(in $000s CAD) Q3 2025 Q3 2024 YTD 2025 YTD 2024
Net earnings (loss) $ (9,101) $ (2,312) $ 24,935 $ 43,155
Finance (revenues) costs 922 (359) (233) (1,316)
Income tax provision (848) 924 10,604 15,534
Depreciation and amortization 16,858 13,097 45,480 37,866
EBITDA $ 7,831 $ 11,350 $ 80,786 $ 95,239
Adjusted gross profit/margin - excludes depreciation expense:
(in $000s CAD) Q3 2025 Q3 2024 YTD 2025 YTD 2024
Total revenue $ 160,731 $ 132,824 $ 540,033 $ 538,659
Less: direct costs 144,190 113,938 437,237 418,403
Gross profit 16,541 18,886 102,796 120,256
Add: depreciation 14,754 12,251 41,047 35,042
Adjusted gross profit 31,295 31,137 143,843 155,298
Adjusted gross margin 19.5% 23.4% 26.6% 28.8%
Net cash – cash net of debt, excluding lease liabilities reported under IFRS 16 Leases:
(in $000s CAD) January 31, 2025 April 30, 2024
Cash $ 62,951 $ 96,218
Contingent consideration (22,608) (8,863)
Long-term debt (28,954) -
Net cash $ 11,389 $ 87,355
Forward-Looking Statements
This news release includes certain information that may constitute “forward-looking information” under applicable
Canadian securities legislation. All statements, other than statements of historical facts, included in this news release that
address future events, developments, or performance that the Company expects to occur (including management’s
expectations regarding the Company’s objectives, strategies, financial condition, results of operations, cash flows and
businesses) are forward-looking statements. Forward-looking statements are typically identified by future or conditional
verbs such as “outlook”, “believe”, “anticipate”, “estimate”, “project”, “expect”, “intend”, “plan”, and terms and expressions
of similar import. All forward-looking information in this news release is qualified by this cautionary note.
Forward-looking information is necessarily based upon various estimates and assumptions including, without limitation,
the expectations and beliefs of management related to the factors set forth below. While these factors and assumptions are
considered reasonable by the Company as at the date of this document in light of management’s experience and perception
of current conditions and expected developments, these statements are inherently subject to significant business, economic
and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially
from those projected in the forward-looking statements and undue reliance should not be placed on such statements and
information.
Such forward-looking statements are subject to a number of risks and uncertainties that include, but are not limited to: the
level of activity in the mining industry and the demand for the Company’s services; competitive pressures; global and local
political and economic environments and conditions; measures affecting trade relations between countries, including the
imposition of tariffs and countermeasures, as well as the possible impacts on the Company's clients, operations and, more
generally, the economy; the integration of business acquisitions and the realization of the intended benefits of such
acquisitions; the level of funding for the Company’s clients (particularly for junior mining companies); exposure to currency
movements (which can affect the Company’s revenue in Canadian dollars); currency restrictions; the Company’s
dependence on key customers; efficient management of the Company’s growth; safety of the Company’s workforce; risks
and uncertainties relating to climate change and natural disaster; the geographic distribution of the Company’s operations;
the impact of operational changes; changes in jurisdictions in which the Company operates (including changes in
regulation); failure by counterparties to fulfill contractual obligations; disease outbreak; as well as other risk factors
described under “General Risks and Uncertainties” in the Company’s MD&A for the year ended April 30, 2024, available on
the SEDAR+ website at www.sedarplus.ca. Should one or more risk, uncertainty, contingency, or other factor materialize or
should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in
the forward-looking information.
Forward-looking statements made in this document are made as of the date of this document and the Company disclaims
any intention and assumes no obligation to update any forward-looking statement, even if new information becomes
available, as a result of future events, or for any other reasons, except as required by applicable securities laws.
About Major Drilling
Major Drilling Group International Inc. is the world’s leading provider of specialized drilling services primarily serving the
mining industry. Established in 1980, Major Drilling has over 1,000 years of combined experience and expertise within its
management team. The Company maintains field operations and offices in North America, South America, Australia, Asia
and Africa. Major Drilling provides a complete suite of drilling services including surface and underground coring,
directional, reverse circulation, sonic, geotechnical, environmental, water-well, coal-bed methane, shallow gas,
underground percussive/longhole drilling, surface drill and blast, a variety of mine services, and ongoing development of
data-driven, high-tech drillside solutions.
Webcast/Conference Call
Major Drilling Group International Inc. will provide a simultaneous webcast and conference call to discuss its quarterly
results on Friday, March 7, 2025 at 8:00 AM (EST). To access the webcast, which includes a slide presentation, please go to
the investors/webcasts section of Major Drilling’s website at www.majordrilling.com and click on the link. Please note that
this is listen-only mode.
To participate in the conference call, please dial 416-340-2217, participant passcode 3731712# and ask for Major Drilling’s
Third Quarter Results Conference Call. To ensure your participation, please call in approximately five minutes prior to the
scheduled start of the call.
For those unable to participate, a taped rebroadcast will be available approximately one hour after the completion of the
call until Monday, March 31, 2025. To access the rebroadcast, dial 905-694-9451 and enter the passcode 2116538#. The
webcast will also be archived for one year and can be accessed on the Major Drilling website at www.majordrilling.com.
For further information:
Ryan Hanley
Director, Corporate Development & Investor Relations
Tel: (506) 857-8636
Fax: (506) 857-9211
Major Drilling Group International Inc.
Interim Condensed Consolidated Statements of Operations
(in thousands of Canadian dollars, except per share information)
(unaudited)
Three months ended Nine months ended
January 31 January 31
2025 2024 2025 2024
TOTAL REVENUE $ 160,731 $ 132,824 $ 540,033 $ 538,659
DIRECT COSTS (note 11) 144,190 113,938 437,237 418,403
GROSS PROFIT 16,541 18,886 102,796 120,256
OPERATING EXPENSES
General and administrative (note 11) 22,750 17,146 59,635 51,258
Other expenses 1,091 1,281 6,553 7,374
(Gain) loss on disposal of property, plant and equipment (217) (114) (887) (611)
Foreign exchange (gain) loss 1,611 2,320 1,883 4,862
Finance (revenues) costs 922 (359) (233) (1,316)
(Earnings) loss from investments 333 - 306 -
26,490 20,274 67,257 61,567
EARNINGS (LOSS) BEFORE INCOME TAX (9,949) (1,388) 35,539 58,689
INCOME TAX EXPENSE (RECOVERY) (note 12)
Current (210) (1,438) 12,431 12,491
Deferred (638) 2,362 (1,827) 3,043
(848) 924 10,604 15,534
NET EARNINGS (LOSS) $ (9,101) $ (2,312) $ 24,935 $ 43,155
EARNINGS (LOSS) PER SHARE (note 13)
Basic $ (0.11) $ (0.03) $ 0.30 $ 0.52
Diluted $ (0.11) $ (0.03) $ 0.30 $ 0.52
Major Drilling Group International Inc.
Interim Condensed Consolidated Statements of Comprehensive Earnings
(in thousands of Canadian dollars)
(unaudited)
Three months ended Nine months ended
January 31 January 31
2025 2024 2025 2024
NET EARNINGS (LOSS) $ (9,101) $ (2,312) $ 24,935 $ 43,155
OTHER COMPREHENSIVE EARNINGS
Items that may be reclassified subsequently to profit or loss
Unrealized gain (loss) on foreign currency translations 13,810 (10,017) 19,260 (7,728)
Unrealized gain (loss) on derivatives (net of tax) 48 381 (490) (438)
COMPREHENSIVE EARNINGS (LOSS) $ 4,757 $ (11,948) $ 43,705 34,989
Major Drilling Group International Inc.
Interim Condensed Consolidated Statements of Changes in Equity
For the nine months ended January 31, 2025 and 2024
(in thousands of Canadian dollars)
(unaudited)
Retained Other Share-based Foreign currency
Share capital earnings reserves payments reserve translation reserve Total
BALANCE AS AT MAY 1, 2023 $ 266,071 $ 105,944 $ (37) $ 3,696 $ 76,903 $ 452,577
Exercise of stock options 626 (197) - (300) - 129
Share-based compensation - - - 218 - 218
Share buyback (note 10) (4,156) (7,093) - - - (11,249)
Stock options expired/forfeited - 1 - (1) - -
262,541 98,655 (37) 3,613 76,903 441,675
Comprehensive earnings:
Net earnings - 43,155 - - - 43,155
Unrealized gain (loss) on foreign
currency translations - - - - (7,728) (7,728)
Unrealized gain (loss) on derivatives - - (438) - - (438)
Total comprehensive earnings - 43,155 (438) - (7,728) 34,989
BALANCE AS AT JANUARY 31, 2024 $ 262,541 $141,810 $ (475) $ 3,613 $ 69,175 $ 476,664
BALANCE AS AT MAY 1, 2024 $ 262,679 $151,740 $ (18) $ 3,630 $ 75,801 $ 493,832
Exercise of stock options 427 - - (115) - 312
Share-based compensation - - - 81 - 81
263,106 151,740 (18) 3,596 75,801 494,225
Comprehensive earnings:
Net earnings - 24,935 - - - 24,935
Unrealized gain (loss) on foreign
currency translations - - - - 19,260 19,260
Unrealized gain (loss) on derivatives - - (490) - - (490)
Total comprehensive earnings - 24,935 (490) - 19,260 43,705
BALANCE AS AT JANUARY 31, 2025 $ 263,106 $176,675 $ (508) $ 3,596 $ 95,061 $ 537,930
Major Drilling Group International Inc.
Interim Condensed Consolidated Statements of Cash Flows
(in thousands of Canadian dollars)
(unaudited)
Three months ended Nine months ended
January 31 January 31
2025 2024 2025 2024
OPERATING ACTIVITIES
Earnings (loss) before income tax $ (9,949) $ (1,388) $ 35,539 $ 58,689
Operating items not involving cash
Depreciation and amortization (note 11) 16,858 13,097 45,480 37,866
(Gain) loss on disposal of property, plant and equipment (217) (114) (887) (611)
Share-based compensation 20 59 81 218
(Earnings) loss from investments 333 - 306 -
Finance (revenues) costs recognized in earnings before income tax 922 (359) (233) (1,316)
7,967 11,295 80,286 94,846
Changes in non-cash operating working capital items 25,938 27,735 29,712 18,343
Finance revenues received (costs paid) (922) 359 233 1,316
Income taxes paid (4,009) (609) (13,691) (10,621)
Cash flow from (used in) operating activities 28,974 38,780 96,540 103,884
FINANCING ACTIVITIES
Repayment of lease liabilities (334) (351) (1,456) (1,082)
Repayment of long-term debt - - - (20,000)
Issuance of common shares due to exercise of stock options 9 15 312 455
Proceeds from draw on long-term debt (note 9) 28,954 - 28,954 -
Cash-settled stock options - - - (326)
Repurchase of common shares (note 10) - (2,682) - (11,249)
Cash flow from (used in) financing activities 28,629 (3,018) 27,810 (32,202)
INVESTING ACTIVITIES
Business acquisition (note 15) (84,084) - (93,172) (6,991)
Investments (note 8) - - (15,205) -
Acquisition of property, plant and equipment (note 7) (12,590) (21,356) (53,914) (55,073)
Proceeds from disposal of property, plant and equipment 316 182 1,927 1,826
Cash flow from (used in) investing activities (96,358) (21,174) (160,364) (60,238)
Effect of exchange rate changes 1,276 (2,189) 2,747 (1,010)
INCREASE (DECREASE) IN CASH (37,479) 12,399 (33,267) 10,434
CASH, BEGINNING OF THE PERIOD 100,430 92,467 96,218 94,432
CASH, END OF THE PERIOD $ 62,951 $ 104,866 $ 62,951 $ 104,866