Yesterday another driller, Orbit Garant, released its 1Q 2016 report. Contrary to Geodrill, Orbit Garant offers its services mainly in Canada.
However, similarly to Geodrill, Orbit also managed to increase the number of meters drilled:
The red arrow marks an uptrend in the number of meters drilled.
On the other hand, also similarly to Geodrill, the pricing power is still at Orbit's customers:
Although the company has more work to do, it gets less money for each meter drilled ($65.2 per one meter in 1Q 2016).
I would say - there are the first symptoms of a revival (more work) but the industry is still far away from a boom (low prices).
OGD.TO Interesting like you say that the initial recovery is in work, and later in pricing power. If you look at the weekly chart, you can see it went from 50 cents to $7 in 2009 to 2011 mining boom, and then dropped with the mining slowdown and just starting to recover with a double this year from a 57 cent low... very cyclical as once might expect.
ReplyDeleteYes, it looks like drilling companies are more cyclical than miners.
DeleteEnergold (EGD.V) is another example.