Specialised drilling services company Master Drilling has posted strong results for the six months ended June 30, with group revenue having increased by 17% year-on-year to $155.8-million and operating profit remaining stable at $26.2-million.

Headline earnings per share increased by 16.7% year-on-year to $0.11 in dollar terms, and by 4.1% year-on-year to 183.9c in rand terms.

Net cash generated from Master Drilling’s operations amounted to $1.9-million, on the back of the company’s investment in working capital associated with the significant increase in revenue.

Of Master Drilling’s total capital spend of $4.3-million, 44% was for the expansion of the company’s fleet and 56% was spent on sustaining the existing fleet.

Additionally, the company’s interest-bearing borrowings have increased from $60.4-million to $69-million, with the gearing ratio, including cash, having increased from 9.1% to 14.9% in the first six months of the financial year.

Master Drilling CEO Danie Pretorius says the results from the first half of this year have demonstrated the value of the company’s diversified drilling model.

“Performance across the group was mixed, with strong activity and new awards in a number of markets offset by project timing, client-driven delays and equipment availability constraints in selected operations.

“Our focus remains on disciplined execution, improving fleet use, converting a healthy opportunity pipeline into profitable secured work and protecting cash returns,” he explains.

In Africa, Master Drilling’s activities in the southern region experienced a slower start to this year compared with previous years, and the company says the primary operational priority is securing follow-on work for its XXXL machine following the completion of a major contract in the region.

The company’s South American activities experienced growth, driven by the launch of its flagship drilling operations, equipment mobilisation for new large-shaft projects and long-term contract finalisation, with further growth anticipated in exploration and horizontal shaft development in the near future.

Meanwhile, in Central and North America, Master Drilling says high tender activity has supported a growing commercial pipeline in the region and that key operational achievements in this regard include the successful deployment of remote-controlled reaming technology, which has yielded efficiency gains and highlighted the value of technology-enabled execution.

Safety remains one of Master Drilling’s key priorities with a high emphasis placed on critical risk-management, the verification of critical controls, targeted compliance interventions and strengthened supervisory accountability in higher-risk activities within the group’s operations.

Pretorius adds that the company’s focus is also on disciplined execution, improving fleet use, converting a good opportunity pipeline into profitable secured work and protecting cash returns.

“We continue to invest selectively in mechanisation, remote operations and digital capability where these technologies can materially improve safety, productivity and client economics.

“The group remains well positioned to participate in the structural demand for mine development and specialist drilling services while maintaining a disciplined approach to capital allocation,” he highlights.

Master Drilling has also secured funding for the next phase of shaft boring system development, with design and manufacturing targeted for completion between late this year and early 2027.

At present, the company’s fleet consists of 151 raise bore, 76 slim drilling and one mobile tunnel boring rig and the total raise boring fleet use is noted to be at about 64% while slim fleet use is at about 38%.

Pretorius says Master Drilling enters the second half of this year with a concerted focus on improving the use of its existing fleet and consolidating its revenue base.

“The group continues to build exposure outside traditional raise boring through tunnelling, exploration, underground safety and technology, civil infrastructure and digital solutions.

“Progress in civil infrastructure, remote drilling and next-generation mining technologies provides evidence of a broader addressable market, although mining remains the dominant revenue base,” Pretorius concludes.