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Boart buying new rigs at last

Salt Lake City-headquartered Boart Longyear said this week it had added a handful of new drill rigs to a global fleet that shrunk last year by 19%. The penny stock that continues to trade on the ASX (BLY) after last year’s massive debt-for-equity debt restructuring says “expanding exploration budgets” have spurred rig purchases in the Americas and Africa.
Boart buying new rigs at last Boart buying new rigs at last Boart buying new rigs at last Boart buying new rigs at last Boart buying new rigs at last

Boart Longyear has added a handful of rigs to its contract drilling fleet after downsizing in 2017

Staff reporter

While only 5-6 rigs at this stage - added to a fleet cut down from 889 at the end of 2016 to 720 units last year - Boart global director of commercial drilling services, Bob Buto said the high-tech machines would help meet the changing needs of users.

"We will continue to evaluate opportunities where we can help our customers meet their 2018 exploration goals using the latest technology," he said.

Boart reported at the end of February its 2017 drilling services revenue grew by 12%, year-on-year, to US$501 million. Total revenue for the year was $739 million, up 15% yoy, but the company posted a $150 million statutory net loss.

Its services/contracting and products divisions produced positive EBITDA for the latest year, but the company's continuing high debt servicing led to a negative earnings result.

Average utilisation of the remaining drill fleet was 43% in 2017 versus 32% the previous year, with the number of operating rigs put at 308 at the end of 2017.

There was no update on that number this week.

Boart CEO Jeff Olsen said the company continud to see signs of improvement in key markets and "this has translated to improvement in revenue, marginally higher utilization of our drill fleet and further improvement in our product backlog compared to 2016".

Boart was trading at A1c this week and had a market capitalisation of A$263 million.