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share our preliminary financials for Q4 2021 and our outlook for 2022.
Trading update Q4 2021
Based on preliminary unaudited financials, Archer expects to report the
following key financials for Q4 2021:
· Revenue of $248 million, up 17.6% compared to Q4 2020
· EBITDA of $22.3 million, up 16.6% compared to Q4 2020
· Net interest-bearing debt reduced by $18 million to $500 million
· Robust available liquidity of $116 million
On the solid fourth quarter, Dag Skindlo, CEO of Archer, comments:
"Archer had a strong fourth quarter with growth in both revenue and EBITDA. The
improvement is particularly related to our Land Drilling operations in
Argentina. I am pleased that the topline growth and improved operational result
were combined with a healthy cash flow generation - reducing net interest
-bearing debt by $18 million over the quarter. "
Reflecting on the improvement during 2021, particularly in Archerâs Well
Services division, Mr. Skindlo added;
âArcher delivered on the financial commitments we outlined early 2021 and
reports an annual growth of roughly 13% in both revenue and EBITDA. We have
strengthened our Well Services division and secured substantial backlog through
the award of the Equinor and ConocoPhillips wireline contracts as well as the
acquisition of DeepWell. The topline growth in our Well Services division
exceeded 60% compared to 2020, while EBITDA increased by 45%.â
In order to address the continued challenging situation in Argentina, Mr.
Skindlo continued;
âDespite the improvement in Q4 for our Land Drilling operations and the improved
outlook following the recent contract award from Pan American Energy, the
situation in Argentina remains challenging. The macro fundamentals in Argentina
following their sovereign debt default constraints the countryâs ability to
further develop their vast oil and gas resources in the short term. In this
context, we have concluded to write down 15 old rigs, pulling units, and
workover units that are unlikely to return to operation, and recorded an
impairment of $14 million in the quarter.â
On Archerâs commitment to energy transition and emission reduction, Mr. Skindlo
states;
"Archer today unveils its roadmap to net zero in 2050, in line with the targets
from the Paris agreement. Archer expects to be carbon neutral within 2022 in
all countries with the exception of Argentina and Bolivia. Hence, our
operations in main countries like Norway, UK and US will be carbon neutral this
year.
Archer will further develop opportunities related to the energy transition and
have identified geothermal drilling and carbon storage as areas where Archer has
a competitive advantage to build on.
Archer is committed to reach net zero by 2050."
Financial outlook 2022
Platform Drilling will see a moderate slow-down in 2022 as we completed two
large P&A projects during 2021, and no more drilling will be required on these
two platforms going forward.
We expect to see improvement in our Well Services division with high activity
globally for Oiltools and a full year impact of the Wireline contracts.
The expectations for our Land Drilling division remain cautious. The recently
announced contract extension with Pan American Energy, combined with the
positive traction in Argentinaâs negotiation with the IMF, provides some
confidence that our Land Drilling division will contribute more to Archerâs
overall performance in 2022.
Archer expects improved financial performance in 2022 on the back of a strong
backlog and market position:
· Revenues for 2022 expected to increase moderately from 2021
· EBITDA for 2022 expected 5-8% higher than 2021, growth primarily in second
half of 2022
· Capex between 3-4% of revenue
· Positive free cash flow
Archerâs Q4 2021 financial report and preliminary 2021 results are scheduled to
be released on February 25, 2022.
Q4 Trading Update and 2022 Outlook presentation
In connection with the trading update, a presentation will be held at 9:00 am
CET on February 2, 2022.
To follow the presentation, the following options are available:
A. Webcast
To register for the webcast please go to
https://streams.eventcdn.net/archer/2021q4/
B. Conference call
To access the call, which is open to the public, please dial in at the
participant telephone numbers listed below. Please call in 10 minutes prior to
the scheduled start time, and ask for the âArcher Fourth Quarter 2021 Trading
Update Callâ
Participants dial-in:
NO: +47 23 50 02 36
UK: +44 333 300 9271
US: +1 631 913 1422 (US PIN: 38816990#)
The operator will ask for your name and company. Following the presentation
there will be a Q&A session. Information on how to ask questions will be given
at the beginning of the Q&A session.
This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)
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