Geodrill Limited

For Q2 2026, revenue was $55.1 million, up 10% versus Q2 2025. Gross profit was $8.8 million and gross margin was 16%, down from 24% a year ago; EBITDA was $7.9 million with a 14% margin, versus 28% in the prior-year period. Net loss was approximately $200,000, or effectively nil per share, compared with net income of $5.4 million in Q2 2025. No formal next-quarter or full-year financial guidance was given; management said it expects to improve margins through execution, with Chile restructuring and productivity improvements over the next couple of quarters.

Dave Harper said the quarter showed two sides of the business: record demand and revenue, but disappointing profitability. He emphasized strong activity across West Africa and the Middle East, a modern fleet, and favorable industry demand supported by gold and copper fundamentals. His tone was constructive but focused on execution, saying the key challenge now is converting strong activity into better earnings.

Greg Borsk said margin compression came from higher labor and operating costs, cedi appreciation, and operating losses in Chile. He highlighted shareholder equity of about $118 million and said the company is keeping cash in the business for operations, with buybacks or dividends reviewed quarterly. He also noted progress on the Cote d'Ivoire repayment issue: monthly installments were reduced to $450,000, payments were made in May, June, July, and August, and about $4.5 million of the scheduled $8.4 million had been repaid through June 2026.

Analysts focused on Chile, asking whether Geodrill might reduce headcount or demobilize rigs and whether the issue was pricing or startup productivity. Management said it is handling Chile client by client, winding down unprofitable contracts where appropriate and concentrating on profitable accounts; they said the issue is mainly productivity, not pricing, and that some good Chile accounts should continue into at least 2027. Management also said it did not have a stripped-out gross margin figure excluding Chile and declined to quantify the Q3 wet-season margin impact.