| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) (Stated in thousands of Canadian dollars) |
| | | March 31, 2022 December 31, 2021 |
| ASSETS | | | | |
| Current assets: | | | | |
| Cash | $ | | | 24,102 $ | 40,588 |
| Accounts receivable | | | | 344,160 | 255,740 |
| Inventory | | | | 24,681 | 23,429 |
| Total current assets | | | | 392,943 | 319,757 |
| Non-current assets: | | | | |
| Deferred tax assets | | | 867 | 867 |
| Right-of-use assets | | | | 50,879 | 51,440 |
| Property, plant and equipment | | | | 2,212,492 | 2,258,391 |
| Intangibles | | | | 22,752 | 23,915 |
| Investments and other assets | | | | 12,951 | 7,382 |
| Total non-current assets | | | | 2,299,941 | 2,341,995 |
| Total assets | $ | | | 2,692,884 $ | 2,661,752 |
| | | | | |
| LIABILITIES AND EQUITY | | | | |
| Current liabilities: | | | | |
| Accounts payable and accrued liabilities | $ | | | 215,587 $ | 224,123 |
| Income taxes payable | | | | 1,489 | 839 |
| Current portion of lease obligations | | | | 10,905 | 10,935 |
| Current portion of long-term debt (Note 5) | | | | 2,214 | 2,223 |
| Total current liabilities | | | | 230,195 | 238,120 |
| | | | | |
| Non-current liabilities: | | | | |
| Share-based compensation (Note 7) | | | | 31,251 | 26,728 |
| Provisions and other | | | | 6,439 | 6,513 |
| Lease obligations | | | | 45,295 | 45,823 |
| Long-term debt (Note 5) | | | | 1,174,462 | 1,106,794 |
| Deferred tax liabilities | | | | 11,828 | 12,219 |
| Total non-current liabilities | | | | 1,269,275 | 1,198,077 |
| Shareholders’ equity: | | | | |
| Shareholders’ capital (Note 8) | | | | 2,297,497 | 2,281,444 |
| Contributed surplus | | | | 76,164 | 76,311 |
| Deficit | | | | (1,310,824 ) | (1,266,980 ) |
| Accumulated other comprehensive income | | | | 130,577 | 134,780 |
| Total shareholders’ equity | | | | 1,193,414 | 1,225,555 |
| Total liabilities and shareholders’ equity | $ | | | 2,692,884 $ | 2,661,752 |
|
| See accompanying notes to condensed interim consolidated financial statements. |
1 |
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF NET LOSS (UNAUDITED) |
| | | Three Months Ended March 31, | |
| (Stated in thousands of Canadian dollars, except per share amounts) | | | 2022 | | 2021 | |
| | | | | | |
| | | | | |
| Revenue (Note 3) | $ | 351,339 $ | | | 236,473 |
| Expenses: | | | | |
| Operating | | 258,974 | | | 160,621 |
| General and administrative | | 55,510 | | | 21,313 |
| Earnings before income taxes, gain on investments and other assets, finance charges, foreign exchange, gain on asset disposals and depreciation and amortization | | 36,855 | | | 54,539 |
| | |
| Depreciation and amortization | | 68,457 | | | 72,013 |
| Gain on asset disposals | | (3,114 ) | | | (2,059 ) |
| Foreign exchange | | | (518 ) | | (64 ) |
| Finance charges (Note 6) | | 20,730 | | | 22,446 |
| Gain on investments and other assets | | (5,569 ) | — |
| Loss before income taxes | | (43,131 ) | | | (37,797 ) |
| Income taxes: | | | | |
| Current | | | 970 | | 784 |
| Deferred | | | (257 ) | | (2,475 ) |
| | | | 713 | | (1,691 ) |
| Net loss | $ | (43,844 ) $ | | | (36,106 ) |
| Net loss per share: (Note 9) | | | | |
| Basic | $ | | (3.25 ) $ | | (2.70 ) |
| Diluted | $ | | (3.25 ) $ | | (2.70 ) | |
|
| See accompanying notes to condensed interim consolidated financial statements. |
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED) |
| | | Three Months Ended March 31, | |
| (Stated in thousands of Canadian dollars) | | | 2022 | | 2021 |
| Net loss | $ | (43,844 ) $ | | | (36,106 ) |
| Unrealized loss on translation of assets and liabilities of operations denominated in foreign currency | | (16,971 ) | | | (20,998 ) |
| | |
| Foreign exchange gain on net investment hedge with U.S. denominated debt | | 12,768 | | | 15,909 |
| | |
| Tax expense related to net investment hedge of long-term debt | | | — | | 285 |
| Comprehensive loss | $ | (48,047 ) $ | | | (40,910 ) | |
|
| See accompanying notes to condensed interim consolidated financial statements. |
2 |
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
| | | Three Months Ended March 31, | |
| (Stated in thousands of Canadian dollars) | | | 2022 | 2021 |
| Cash provided by (used in): | | | | |
| Operations: | | | | |
| Net loss | $ | (43,844 ) $ | | (36,106 ) |
| Adjustments for: | | | | |
| Long-term compensation plans | | 31,212 | | 7,148 |
| Depreciation and amortization | | 68,457 | | 72,013 |
| Gain on asset disposals | | (3,114 ) | | (2,059 ) |
| Foreign exchange | | | (271 ) | 558 |
| Finance charges | | 20,730 | | 22,446 |
| Income taxes | | | 713 | (1,691 ) |
| Other | | | — | 3 |
| Gain on investments and other assets | | (5,569 ) | — |
| Income taxes paid | | | (227 ) | (161 ) |
| Interest paid | | (38,161 ) | | (18,766 ) |
| Interest received | | | 29 | 45 |
| Funds provided by operations | | 29,955 | | 43,430 |
| Changes in non-cash working capital balances | | (95,249 ) | | (28,008 ) |
| | | (65,294 ) | | 15,422 |
| Investments: | | | | |
| Purchase of property, plant and equipment | | (36,402 ) | | (8,436 ) |
| Proceeds on sale of property, plant and equipment | | 2,847 | | 3,324 |
| Changes in non-cash working capital balances | | 3,212 | | (4,802 ) |
| | | (30,343 ) | | (9,914 ) |
| Financing: | | | | |
| Issuance of long-term debt | | 88,124 | | 20,000 |
| Repayments of long-term debt | | (8,190 ) | | (49,425 ) |
| Repurchase of share capital | | | — | (4,294 ) |
| Issuance of common shares on the exercise of options | | 1,396 | — |
| Debt issuance costs | | | — | (244 ) |
| Lease payments | | (1,567 ) | | (1,621 ) |
| | | 79,763 | | (35,584 ) |
| Effect of exchange rate changes on cash | | | (612 ) | (865 ) |
| Decrease in cash | | (16,486 ) | | (30,941 ) |
| Cash, beginning of period | | 40,588 | | 108,772 |
| Cash, end of period | $ | 24,102 $ | | 77,831 | |
|
| See accompanying notes to condensed interim consolidated financial statements. |
3 |
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED) |
| | | | | Accumulated |
| | | | | | Other |
| | Shareholders’ | | Contributed | Comprehensive | Total |
| (Stated in thousands of Canadian dollars) | | Capital | Surplus | | Income | Deficit | Equity |
| Balance at January 1, 2022 | $ 2,281,444 $ | | | | | | | 76,311 $ | 134,780 $ (1,266,980 ) $ 1,225,555 |
| Net loss for the period | | — | | | | | | — | — | (43,844 ) | (43,844 ) |
| Other comprehensive loss for the period | | — | | | | | | — | (4,203 ) | — | (4,203 ) |
| Share options exercised | | 1,970 | | | | | | (574 ) | — | — | 1,396 |
| Settlement of Executive Performance Share Units | | 14,083 | | | | | | — | — | — | 14,083 |
| | |
| Share-based compensation reclassification | | — | | | | | | (219 ) | — | — | (219 ) |
| Share-based compensation expense | | — | | | | | | 646 | — | — | 646 |
| Balance at March 31, 2022 | $ 2,297,497 $ | | | | | | | 76,164 $ | 130,577 $ (1,310,824 ) $ 1,193,414 |
|
| |
| | | | | Accumulated |
| | | | | | Other |
| | Shareholders’ | | Contributed | Comprehensive | | | Total |
| (Stated in thousands of Canadian dollars) | | Capital | Surplus | | Income | Deficit | Equity |
| Balance at January 1, 2021 | $ 2,285,738 $ | | 72,915 $ | 137,581 $ (1,089,594 ) $ 1,406,640 |
| Net loss for the period | | — | | | | | | — | — | (36,106 ) | (36,106 ) |
| Other comprehensive loss for the period | | — | | | | | | — | (4,804 ) | — | (4,804 ) |
| Share repurchases | | (4,294 ) | | | | | | — | — | — | (4,294 ) |
| Share-based compensation reclassification | | — | | | | | | (1,455 ) | — | — | (1,455 ) |
| Share-based compensation expense | | — | | | | | | 2,359 | — | — | 2,359 |
| Balance at March 31, 2021 | $ 2,281,444 $ | | 73,819 $ | 132,777 $ (1,125,700 ) $ 1,362,340 |
|
| See accompanying notes to condensed interim consolidated financial statements. |
4 |
| NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Tabular amounts are stated in thousands of Canadian dollars except share numbers and per share amounts) |
| NOTE 1. DESCRIPTION OF BUSINESS |
| Precision Drilling Corporation (Precision or the Corporation) is incorporated under the laws of the Province of Alberta, Canada and is a provider of contract drilling and completion and production services primarily to oil and natural gas and geothermal exploration and production companies in Canada, the United States and certain international locations. |
| NOTE 2. BASIS OF PRESENTATION |
| (a) Statement of Compliance |
| These condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board and interpretations of the International Financial Reporting Interpretations Committee. |
| The condensed interim consolidated financial statements do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Corporation as at and for the year ended December 31, 2021. |
| These condensed interim consolidated financial statements were prepared using accounting policies and methods of their application consistent with those used in the preparation of the Corporation’s consolidated audited annual financial statements for the year ended December 31, 2021. |
| These condensed interim consolidated financial statements were approved by the Board of Directors on April 27, 2022. |
| (b) Use of Estimates and Judgements |
| The preparation of the condensed interim consolidated financial statements requires management to make estimates and judgements that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingencies. These estimates and judgements are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The estimation of anticipated future events involves uncertainty and, consequently, the estimates used in preparation of the condensed interim consolidated financial statements may change as future events unfold, more experience is acquired, or the Corporation’s operating environment changes. |
| Significant estimates and judgements used in the preparation of these condensed interim consolidated financial statements remained unchanged from those disclosed in the Corporation’s consolidated audited annual financial statements for the year ended December 31, 2021. |
| | |
5 |
| NOTE 3. REVENUE |
| (a) Disaggregation of revenue |
| The following table includes a reconciliation of disaggregated revenue by reportable segment. Revenue has been disaggregated by primary geographical market and type of service provided. |
| | | | Completion |
| | | Contract | | and | | Inter- |
| | | Drilling | Production | | Corporate and Other | Segment |
| Three Months Ended March 31, 2022 | | Services | Services | | | | Eliminations | Total |
| United States | $ | 141,265 $ | | 4,038 $ | | | | | — $ | (1 ) $ | | 145,302 |
| Canada | | | 138,517 | | 34,200 | | | | | — | (1,043 ) | | 171,674 |
| International | | 34,363 | | — | | | | | — | — | | 34,363 |
| | $ | 314,145 $ | | 38,238 $ | | | | | — $ | (1,044 ) $ | | 351,339 |
| | | | | | | | | | | | | |
| Day rate/hourly services | $ | 298,050 $ | | 38,238 $ | | | | | — $ | (193 ) $ | | 336,095 |
| Turnkey drilling services | | 14,738 | | — | | | | | — | — | | 14,738 |
| Other | | 1,357 | | — | | | | | — | (851 ) | 506 |
| | $ | 314,145 $ | | 38,238 $ | | | | | — $ | (1,044 ) $ | | 351,339 |
|
| |
| | | | Completion |
| | | Contract | | and | | Inter- |
| | | Drilling | Production | | Corporate and Other | Segment |
| Three Months Ended March 31, 2021 | | Services | Services | | | | Eliminations | Total |
| United States | | $ | 82,674 $ | | 3,308 $ | | | | | — $ | — $ | | 85,982 |
| Canada | | 86,083 | 29,236 | | | | | | — | (890 ) | | 114,429 |
| International | | 36,062 | | — | | | | | — | — | | 36,062 |
| | | $ | 204,819 $ | 32,544 $ | | | | | | — $ | (890 ) $ | | 236,473 |
| | | | | | | | | | | | | |
| Day rate/hourly services | $ | 193,349 $ | 32,544 $ | | | | | | — $ | (108 ) $ | | 225,785 |
| Shortfall payments/idle but contracted | | 116 | | — | | | | | — | — | 116 |
| Turnkey drilling services | | 5,946 | | — | | | | | — | — | | 5,946 |
| Directional services | | 3,779 | | — | | | | | — | — | | 3,779 |
| Other | | 1,629 | | — | | | | | — | (782 ) | 847 |
| | $ | 204,819 $ | 32,544 $ | | | | | | — $ | (890 ) $ | | 236,473 |
| | | | | | | | | | | | | | | | | | | | |
| | |
| (b) Seasonality |
| Precision has operations that are carried on in Canada which represent approximately 49% (2021 - 48%) of consolidated revenue for the three months ended March 31, 2022 and 37% (2021 - 37%) of consolidated total assets as at March 31, 2022. The ability to move heavy equipment in Canadian oil and natural gas fields is dependent on weather conditions. As warm weather returns in the spring, the winter's frost comes out of the ground rendering many secondary roads incapable of supporting the weight of heavy equipment until they have thoroughly dried out. The duration of this “spring break-up” has a direct impact on Precision’s activity levels. In addition, many exploration and production areas in northern Canada are accessible only in winter months when the ground is frozen hard enough to support equipment. The timing of freeze up and spring break-up affects the ability to move equipment in and out of these areas. As a result, late March through May is traditionally Precision’s slowest time in this region. |
| | | | | | | | | | | | |
6 |
| NOTE 4. SEGMENTED INFORMATION |
| The Corporation has two reportable operating segments; Contract Drilling Services and Completion and Production Services. Contract Drilling Services includes drilling rigs, procurement and distribution of oilfield supplies, and manufacture, sale and repair of drilling equipment. Completion and Production Services includes service rigs, oilfield equipment rental and camp and catering services. The Corporation provides services primarily in Canada, the United States and certain international locations. |
| | | | Completion |
| | Contract | | | and | | Inter- |
| | | Drilling | Production | | Corporate and Other | Segment |
| Three Months Ended March 31, 2022 | | Services | | Services | | | | Eliminations | Total |
| Revenue | $ 314,145 $ | | | 38,238 $ | | | — $ | (1,044 ) $ 351,339 |
| Earnings before income taxes, gain on investments and other assets, finance charges, foreign exchange, gain on asset disposals and depreciation and amortization | | 71,174 | | 6,539 (40,858 ) | | — | | 36,855 |
| Depreciation and amortization | | 62,653 | | 3,350 | 2,454 | — | | 68,457 |
| Gain on asset disposals | | (1,882 ) | | (1,170 ) | | | | | (62 ) | — | | (3,114 ) |
| Total assets | 2,432,067 | | 135,577 125,240 | | | — 2,692,884 |
| Capital expenditures | | 35,228 | | 1,000 | | | | | 174 | — | | 36,402 |
|
| |
| | | | Completion |
| | Contract | | | and | | Inter- |
| | | Drilling | Production | | Corporate and Other | Segment |
| Three Months Ended March 31, 2021 | | Services | | Services | | | | Eliminations | Total |
| Revenue | $ 204,819 $ | | | 32,544 $ | | | — $ | (890 ) $ 236,473 |
| Earnings before income taxes, finance charges, foreign exchange, gain on asset disposals and depreciation and amortization | | 60,031 | | 7,802 (13,294 ) | | — | | 54,539 |
| | |
| Depreciation and amortization | | 65,232 | | 4,001 | 2,780 | — | | 72,013 |
| Gain on asset disposals | | (1,725 ) | | (243 ) | | | | | (91 ) | — | | (2,059 ) |
| Total assets | 2,495,562 | | 140,248 159,786 | | | — 2,795,596 |
| Capital expenditures | | 7,438 | | 904 | | | 94 | — | | 8,436 |
|
| A reconciliation of total segment earnings before income taxes, gain on investments and other assets, finance charges, foreign exchange, gain on asset disposals and depreciation and amortization to net loss is as follows: |
| | | | | | Three Months Ended March 31, | |
| | | | | | | | 2022 | 2021 |
| Total segment earnings before income taxes, gain on investments and other assets, finance charges, foreign exchange, gain on asset disposals and depreciation and amortization | | | | $ | | | 36,855 $ | 54,539 |
| | | | | |
| Deduct: | | | | | | | |
| Depreciation and amortization | | | | | | | 68,457 | 72,013 |
| Gain on asset disposals | | | | | | | (3,114 ) | (2,059 ) |
| Foreign exchange | | | | | | | (518 ) | (64 ) |
| Finance charges | | | | | | | 20,730 | 22,446 |
| Gain on investments and other assets | | | | | | | (5,569 ) | — |
| Income taxes | | | | | | | 713 | (1,691 ) |
| Net loss | | | | | $ | | | | | (43,844 ) $ | (36,106 ) |
|
| |
| | | | | | | | | | | |
7 |
| NOTE 5. LONG-TERM DEBT |
| | | | | Canadian Facilities and |
| | | U.S. Denominated Facilities | | Translated U.S. Facilities | |
| | | March 31, December 31, March 31, December 31, |
| | | 2022 | | | 2021 | 2022 | 2021 |
| | | | | | | | | | | | | | |
| Current Portion of Long-Term Debt | | | | | | | | | | | | |
| Canadian Real Estate Credit Facility | US $ | | | | | — US $ | — $ | 1,333 $ | | | | 1,333 |
| U.S. Real Estate Credit Facility | | | | | | 704 | 704 | 881 | 890 |
| | | | | | | | | | | US $ | | | | | 704 US $ | 704 $ | 2,214 $ | | | | 2,223 |
| | | | | | | | | | | | | | |
| Long-Term Debt | | | | | | | | | | | | |
| Senior Credit Facility | US $ 182,000 US $ | | | | 118,000 $ 227,547 $ | | | 149,206 |
| Canadian Real Estate Credit Facility | | | | | | — | — | 17,334 | | | | 17,667 |
| U.S. Real Estate Credit Facility | | 8,917 | | | 9,093 | 11,149 | | | | 11,498 |
| Unsecured Senior Notes: | | | | | | | | | | | | |
| | | | | | | | | | 7.125% senior notes due 2026 | | 347,765 | | | 347,765 | 434,796 | | | | 439,735 |
| | | | | | | | | | 6.875% senior notes due 2029 | | 400,000 | | | 400,000 | 500,104 | | | | 505,784 |
| | US $ 938,682 US $ | | | | 874,858 1,190,930 | | | 1,123,890 |
| Less net unamortized debt issue costs and original issue | | | | | | | | (16,468 ) | | | | (17,096 ) |
| discount |
| | | | | | | | $ 1,174,462 $ 1,106,794 |
|
| |
| | | | | Debt Issue |
| | | | | | | Canadian | U.S. Real | Costs and |
| | | | | | | | | | | Senior | Unsecured | | | | | Real Estate | Estate | Original |
| | | | | | | | | | | Credit | Senior | | | | | Credit | Credit | | | | Issue |
| | | | | | | | | | | Facility | Notes | | | | | Facility | Facility | Discount | | | | Total |
| Current | | | | | | | | | | | $ | — $ | — $ | | | | 1,333 $ | 890 $ | | | | — $ | 2,223 |
| Long-term | | | | | | | | | | | | 149,206 | 945,519 | | | | | 17,667 | 11,498 | (17,096 ) 1,106,794 |
| December 31, 2021 | | | | | | | | | | | | 149,206 | 945,519 | | | | | 19,000 | 12,388 | (17,096 ) 1,109,017 |
| Changes from financing cash flows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Proceeds from Senior Credit Facility | | | | | | | | | | | | 88,124 | — | | | | — | — | | | | — | 88,124 |
| Repayment of Senior Credit Facility | | | | | | | | | | | | (7,634 ) | — | | | | — | — | | | | — | (7,634 ) |
| Repayment of Real Estate Credit Facility | | | | | | | | | | — | — | | | | (333 ) | (223 ) | | | | — | (556 ) |
| | | | | | | | | | | | | 229,696 | 945,519 | | | | | 18,667 | 12,165 | (17,096 ) 1,188,951 |
| Amortization of debt issue costs | | | | | | | | | | | | — | — | | | | — | — | | | | 629 | 629 |
| Foreign exchange adjustment | | | | | | | | | | | | (2,149 ) | (10,619 ) | | | | | — | (135 ) | | | | (1 ) | (12,904 ) |
| March 31, 2022 | | | | | | | | | | | $ 227,547 $ 934,900 $ | 18,667 $ | 12,030 $ (16,468 ) $ 1,176,676 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Current | | | | | | | | | | | $ | — $ | — $ | | | | 1,333 $ | 881 $ | | | | — $ | 2,214 |
| Long-term | | | | | | | | | | | | 227,547 | 934,900 | | | | | 17,334 | 11,149 | (16,468 ) 1,174,462 |
| | | | | | | | | | | | $ 227,547 $ 934,900 $ | 18,667 $ | 12,030 $ (16,468 ) $ 1,176,676 |
|
| At March 31, 2022, Precision was in compliance with the covenants of the Senior Credit Facility and Real Estate Credit Facilities. |
8 |
| (b) Executive Performance Share Units |
| A summary of the activity under Executive Performance Share Unit (Executive PSU) share-based incentive plan is presented below: |
| | | Executive PSUs |
| | | Outstanding |
| December 31, 2021 | | | 189,964 |
| Redeemed | | | (189,964 ) |
| March 31, 2022 | | — |
|
| Pursuant to the Omnibus Plan, Precision elected to settle 131,950 vesting Executive PSUs in 263,900 common shares. |
| (c) Non-Management Directors – Deferred Share Unit Plan |
| A summary of the activity under the non-management director Deferred Share Unit (DSU) plan is presented below: |
DSUs |
| | | Outstanding |
| December 31, 2021 | | | 104,591 |
| Granted | | 2,998 |
| March 31, 2022 | | | 107,589 |
|
| Equity Settled Plans |
| (d) Option Plan |
| A summary of the activity under the option plan is presented below: |
| | Weighted |
| | | | | | Range of | Average |
| Canadian share options | | | | | Outstanding | Exercise Price | | Exercise Price Exercisable |
| December 31, 2021 | | | | | 115,605 $ 87.00 — 146.40 $ | 123.35 | | 115,605 |
| Forfeited | | | | | (52,980 ) 146.40 — 146.40 | 146.40 | |
| March 31, 2022 | | | | | | | 62,625 $ 87.00 — 145.97 $ | 103.85 | | 62,625 |
|
| |
| | Weighted |
| | | | | | Range of | Average |
| | | | | | Exercise Price | Exercise Price |
| U.S. share options | | | | | Outstanding | (US$) | | (US$) Exercisable |
| December 31, 2021 | | | | | 267,843 $ 51.20 — 115.80 $ | 80.43 | | 257,854 |
| Exercised | | | | | (21,370 ) 51.20 — 51.20 | 51.20 | |
| Forfeited | | | | | (32,205 ) 115.80 — 115.80 | 115.80 | |
| March 31, 2022 | | | | | 214,268 $ 51.20 — 111.47 $ | 78.03 | | 214,268 |
|
| (e) Non-Management Directors – Deferred Share Unit Plan |
| A summary of the activity under this share-based incentive plan is presented below: |
DSUs |
| | | Outstanding |
| December 31, 2021 and March 31, 2022 | | 1,470 |
|
| |
| | | | | | | | | |
10 |
| NOTE 8. SHAREHOLDERS’ CAPITAL Common shares |
| | | Number | Amount |
| December 31, 2021 | | 13,304,425 $ | 2,281,444 |
| Settlement of Executive PSUs | | 263,900 | 14,083 |
| Share options exercised | | 21,370 | 1,970 |
| March 31, 2022 | | 13,589,695 $ | 2,297,497 |
|
| NOTE 9. PER SHARE AMOUNTS |
| The following tables reconcile the net loss and weighted average shares outstanding used in computing basic and diluted net loss per share: |
| | | | | | Three Months Ended March 31, | |
| | | | | | 2022 | 2021 |
| Net loss - basic and diluted | | | | $ | (43,844 ) $ | (36,106 ) | |
|
| |
| | | | | | Three Months Ended March 31, | |
| (Stated in thousands) | | | | | 2022 | 2021 |
| Weighted average shares outstanding – basic | | | | | 13,479 | 13,349 |
| Effect of share options and other equity compensation plans | | | | | — | — |
| Weighted average shares outstanding – diluted | | | | | 13,479 | 13,349 | |
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| NOTE 10. FAIR VALUES OF FINANCIAL INSTRUMENTS |
| The carrying values of cash, accounts receivable, and accounts payable and accrued liabilities approximates their fair value due to the relatively short period to maturity of the instruments. At the end of each reporting period, investments and other assets are measured at their estimated fair value, with changes in fair value recognized in profit or loss. Amounts drawn on the Senior Credit Facility and the Canadian and U.S. Real Estate Credit Facilities are measured at amortized cost and approximate fair value as this indebtedness is subject to floating rates of interest. The fair value of the unsecured senior notes at March 31, 2022 was approximately $955 million (December 31, 2021 – $969 million). |
| Financial assets and liabilities recorded or disclosed at fair value in the consolidated statement of financial position are categorized based upon the level of judgement associated with the inputs used to measure their fair value. Hierarchical levels are based on the amount of subjectivity associated with the inputs in the fair value determination and are as follows: |
| Level I—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. |
| Level II—Inputs (other than quoted prices included in Level I) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. |
| Level III—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. |
| The estimated fair value of unsecured senior notes is based on level II inputs. The fair value is estimated considering the risk-free interest rates on government debt instruments of similar maturities, adjusted for estimated credit risk, industry risk and market risk premiums. |
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| SHAREHOLDER INFORMATION | | CORPORATE INFORMATION |
| STOCK EXCHANGE LISTINGS Shares of Precision Drilling Corporation are listed on the Toronto Stock Exchange under the trading symbol PD and on the New York Stock Exchange under the trading symbol PDS. | | DIRECTORS Michael R. Culbert William T. Donovan Brian J. Gibson Steven W. Krablin Susan M. MacKenzie Kevin O. Meyers Kevin A. Neveu David W. Williams |
| TRANSFER AGENT AND REGISTRAR Computershare Trust Company of Canada Calgary, Alberta |
| TRANSFER POINT Computershare Trust Company NA Canton, Massachusetts |
| | | OFFICERS Kevin A. Neveu President and Chief Executive Officer |
| Q1 2022 TRADING PROFILE Toronto (TSX: PD) High: $93.54 Low: $46.40 Close: $92.70 Volume Traded: 6,654,944 |
| | | Veronica H. Foley Chief Legal and Compliance Officer |
| | | Carey T. Ford Senior Vice President and Chief Financial Officer Shuja U. Goraya Chief Technology Officer |
| New York (NYSE: PDS) High: US$73.92 Low: US$37.02 Close: US$73.92 Volume Traded: 5,077,530 |
| | | Darren J. Ruhr Chief Administrative Officer |
| ACCOUNT QUESTIONS Precision’s Transfer Agent can help you with a variety of shareholder related services, including: |
| | | Gene C. Stahl Chief Marketing Officer |
| • change of address • lost unit certificates • transfer of shares to another person • estate settlement | | AUDITORS KPMG LLP Calgary, Alberta |
| Computershare Trust Company of Canada 100 University Avenue 9th Floor, North Tower Toronto, Ontario M5J 2Y1 Canada | | HEAD OFFICE Suite 800, 525 8th Avenue SW Calgary, Alberta, Canada T2P 1G1 Telephone: 403-716-4500 Facsimile: 403-264-0251 Email: info@precisiondrilling.com www.precisiondrilling.com |
| 1-800-564-6253 (toll free in Canada and the United States) 1-514-982-7555 (international direct dialing) Email: service@computershare.com |
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| ONLINE INFORMATION To receive news releases by email, or to view this interim report online, please visit Precision’s website at www.precisiondrilling.com and refer to the Investor Relations section. Additional information relating to Precision, including the Annual Information Form, Annual Report and Management Information Circular has been filed with SEDAR and is available at www.sedar.com and on the EDGAR website www.sec.gov |
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