Pioneer Drilling turns corner on profit, sees better days ahead for land fleet

Ray Tyson

Petroleum News Houston correspondent

For the first time in eight consecutive quarters, contract driller Pioneer Drilling has something to cheer about.

Pioneer, which maintains a fleet of 36 land rigs that operate in Texas and Louisiana, reported a profit of $409,000 or 2 cents per share for its fiscal fourth quarter ending March 31. That compared to a loss of $1.9 million or 11 cents per share for the year-ago quarter. Revenues for the fiscal fourth quarter of 2004 were $33.4 million, compared to revenues of $25.1 million in the fourth quarter of 2003.

“We are pleased that operating income was sufficient to have generated our first net earnings in eight quarters,” Stacy Locke, Pioneer’s chief executive officer, said June 23. Locke said demand for its rigs continued to improve, which allowed the company to gradually increase day rates and profitability on turnkey contracts.

“With continued strong commodity prices, particularly natural gas prices, we see no reason why the current trends will not continue,” he added.

Pioneer reported 2,496 revenue days during the fourth quarter of fiscal 2004 compared to 1,808 days for the fourth quarter of fiscal 2003. Average rig utilization for the fourth quarter was 91 percent, up from 84 percent in the same period last year, the company said. During the company’s last fiscal year, Pioneer increased its rig fleet by 46 percent, from 24 to 35 drilling rigs, in four separate acquisitions, two of which allowed Pioneer to expand geographically. Pioneer’s rigs drill in depth ranges between 8,000 and 18,000 feet.

“Over the last several years we have maintained a focus on growth and intend to continue to look for strategic and financially attractive growth opportunities,” Locke said.