Mitchell Services (MSV) Q2 2025 TU earnings summary

Executive summary

• H2 is expected to be stronger than H1, with improved utilization and benefits from recent investments beginning to materialize.

• Quarterly revenue of $46.7m and EBITDA of $5.6m for FY25 Q2, both down year-over-year due to lower utilisation and ramp-up costs.

• The business is positioned well with a strong balance sheet, enabling continued investment in growth opportunities.

• Entry into the PNG market and expansion into SIS drilling and decarbonisation services signal strategic growth.

Financial highlights

• Revenue per rig dipped to a two-year low, primarily due to seasonality and a temporary reduction in specialist work.

• FY25 Q2 revenue declined 17.9% year-over-year to $46.7m; EBITDA fell 33.1% to $5.6m.

• For 1H25, revenue was $99.4m (down 18.3%), EBITDA $12.7m (down 36.8%), and a post-tax loss of ~$0.5m.

• Expenses for new contracts, particularly in PNG and Loop, were incurred in H1, with revenue expected in H2.

Outlook and guidance

• H2 performance is anticipated to improve, driven by mobilization of new contracts and increased specialist work.

• Operating rig count expected to increase in FY25 Q3 as new projects commence.

• No specific quantitative guidance provided, but management expects a positive impact in H2.

• Analysts are expected to update forecasts following the release of half-year results.