Precision Drilling ( NYSE: PDS ) said Thursday it is "well on track" to achieve its long-term goal of repaying more than $400M in debt and reaching a sustained net debt to adjusted EBITDA leverage ratio of below 1.5x by year-end 2025.
Given its strong free cash flow outlook, the company now expects leverage of 1.25x-1.75x by the end of 2023 and will look to exceed its long-term debt reduction targets on both an absolute level and as a multiple of adjusted EBITDA.
Precision ( PDS ) also said it will continue to allocate 10%-20% of free cash flow before debt principal repayments toward the return of capital to shareholders; the company repurchased and cancelled more than 130K common shares in 2022 under its normal course issuer bid.
Precision ( PDS ) said its Q4 active rig count averaged 66 for Canada and 59 for the U.S., up 27% and 31% Y/Y respectively.
The company also expects its Canadian and U.S. Q4 field margins will exceed prior guidance and continue trending upward in 2023.
Precision Drilling ( PDS ) shares have lost 12% in the past month but gained 91% during the past year .
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Precision Drilling says poised to exceed debt reduction targets