December 5, 2011 / 9:25 PM / 6 years ago

Major Drilling profit more than doubles

TORONTO (Reuters) - Major Drilling Group (MDI.TO) said on Monday its quarterly profit more than doubled as demand for its exploration drilling services remained strong.

Net income in the fiscal second quarter ended October 31 rose to C$31.6 million ($31.2 million), or 42 Canadian cents a share, from a year-before profit of C$11.3 million, or 16 Canadian cents a share.

Revenue rose more than 65 percent to C$213.9 million, the company said.

Moncton, New Brunswick-based Major Drilling is one of the world’s largest metals and minerals contract drilling service companies.

“Looking at the balance of fiscal 2012, assuming that customers continue with their stated plans, we should see continuing growth,” Chief Executive Francis McGuire said in a statement.

“Despite the current economic environment, our industry has not shown any signs of a slowdown to this point,” he said. “Most commodity prices are still at relatively high levels while many of our customers, both seniors and juniors, are in much better financial position than three years ago.”

The company said its profit margins rose significantly as it renewed many of its drilling contracts at higher prices.

Gross profits as a percentage of sales rose to 34.6 percent in the quarter ended October 31, from 27.5 percent a year earlier.

($1=$1.02 Canadian)

Reporting By Euan Rocha; Editing by Peter Galloway

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