Business
Precision Drilling Trust reports record first quarter results and announces expansion plans for the United States
Precision Drilling Trust reports record first quarter results and announces expansion plans for the United States.
About this update from Precision Drilling Corporation
[{"type":"text","content":"\n\n\n\n\n(Canadian dollars)\n\nCALGARY, April 26 /CNW/ - Precision Drilling Trust (\"Precision\" or the\n\"Trust\") today reports record results for the first quarter ended March 31,\n2006 from its continuing operations in Canada and the first full reporting\nquarter as an income trust. Precision is also announcing plans to expand\ncontract drilling operations into the United States.\nEarnings from continuing operations in the first quarter of 2006 were\n$224.2 million compared to $88.3 million for the comparable quarter in 2005\nand $120.9 million in the quarter ended December 31, 2005. Earnings from\ncontinuing operations increased by $1.08 per diluted unit or 152% to $1.79 in\nthe first quarter of 2006 compared to $0.71 in 2005. The increase is\nattributable to a number of factors including exceptionally strong customer\ndemand, favourable weather conditions and a lower effective tax rate due to\nPrecision's conversion to an income trust. Significant year over year\nincreases in equipment activity and pricing for both the Contract Drilling\nServices and Completion and Production Services segments resulted in increased\nearnings per diluted unit of $0.50 in the first quarter of 2006, which is 70%\nhigher than the comparable quarter in 2005. The lower effective tax rate added\n$0.58 per diluted unit in the current quarter.\nPrecision had a very successful first quarter in 2006 as sequential\nquarterly momentum associated with high oil and natural gas commodity prices\nrealized in 2005 carried over into the current year. During the first quarter\nof 2006, oil prices remained strong while North American Henry Hub natural gas\nspot prices ranged from a high of US$10.05 per Mmbtu to a low of US$6.50 per\nMmbtu. Despite the softening of natural gas prices, customers continue to\naggressively pursue their drilling and well servicing programs and Precision\nexpects to return to high seasonal activity levels once second quarter spring\nbreakup runs its course and road bans are lifted.\nPrecision is pleased to announce its strategic expansion into the United\nStates drilling market. \"The U.S. market offers an opportunity for higher year\nround utilization and strong customer demand,\" said Gene Stahl, President and\nChief Operating Officer. \"More importantly, there is a strong technical fit\nfor Precision's equipment and expertise in...