Archer secures integrated PinA drilling deal with Equinor, posts 13.4% margin
Archer reported Q1 revenue of $278 million, down 7% year-on-year due to divested operations but up 15% ex-divestment, driving EBITDA of $37.2 million and a 13.4% margin against a $4 billion backlog. The company secured integrated PinA drilling contracts with Equinor and ConocoPhillips and returned $6.4 million to shareholders.
1. Q1 Financial Performance
Archer reported Q1 revenue of $278 million, down 7% year-on-year due to the divestment of its Argentina work-over business. Excluding that divestment, revenue increased 15%, while EBITDA rose 12% to $37.2 million and margin improved from 12.5% to 13.4%.
2. Strategic Contract Wins
The company secured integrated PinA drilling contracts with Equinor and extensions with ConocoPhillips, bolstering its service lineup and reinforcing relationships with major energy players in both offshore and onshore segments.
3. Backlog and Shareholder Returns
Archer maintained a $4 billion backlog, adding $420 million of firm contract value year-to-date, and continued its shareholder return program by distributing $6.4 million in Q1 and approving an additional $6.6 million for Q2.
4. Operational Challenges
Revenue from land drilling in Argentina declined 24% sequentially, leading to a 200-person reduction in Brazil after a contract ended. The floating offshore wind substructure project faced delays and higher costs, while seasonal working capital build-up and interest payments weighed on cash flow.