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Patterson-UTI (PTEN) Suffers Loss in Q3, Beats on Sales

In third-quarter 2021, Patterson-UTI (PTEN) spends $34.3 million on capital programs compared with $13.4 million invested a year ago.

This story originally appeared on Zacks

Patterson-UTI Energy, Inc. PTEN reported third-quarter 2021 adjusted net loss of 44 cents per share, matching the Zacks Consensus Estimate. However, the loss was narrower than the year-ago quarter's loss of 60 cents.

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Bottom-line results can be attributed to increased cost and expenses as well as escalated capital expenditure, partially offset by higher contribution from pressure pumping and directional drilling segments.

The company’s total quarterly revenues of $358 million surpassed the Zacks Consensus Estimate of $357 million. Moreover, the top line improved 72.8% on a year-over-year basis.

Segmental Performances

Contract Drilling: Revenues totaled $157.9 million, up 37.2% year over year. The unit lost $51.8 million in the third quarter, wider than the year-ago loss of $47.2 million, plagued by a rise in average rig cost per day.

Pressure Pumping: Revenues of $152.6 million rose 112.1% from the year-ago figure of $72 million. Moreover, the segment’s operating loss narrowed to $13.8 million from $30.9 million in the third quarter of 2020, attributable to improved pricing and an excellent service quality.

Directional Drilling: Revenues summed $31.7 million, up 208.9% year over year. Also, the segment’s operating loss narrowed to $4.6 million from a loss of $9.9 million reported in the corresponding quarter of 2020, attributable to increasing activity in the second quarter, led by 70% growth in the number of rigs on which the company provides directional drilling services.

Other Operations: Revenues were $15.6 million, 58.5% above the year-ago quarter’s $9.8 million. The unit also posted an improved quarterly loss of $1.3 million from a loss of $6.4 million recorded in the year-ago quarter.

Capital Expenditure & Financial Position

In third-quarter 2021, Patterson-UTI spent $34.3 million on capital programs (compared with $13.4 million in the third quarter of 2020). As of Sep 30, 2021, the company had $191.3 million of cash and cash equivalents, and $902.1 million as long-term debt.

This Houston, TX-based company maintained its quarterly dividend of 2 cents a share, payable Dec 16, 2021 to its shareholders of record as of Dec 2, 2021.

PattersonUTI Energy, Inc. Price, Consensus and EPS Surprise

PattersonUTI Energy, Inc. Price, Consensus and EPS Surprise

PattersonUTI Energy, Inc. price-consensus-eps-surprise-chart | PattersonUTI Energy, Inc. Quote


Based on contracts currently in place, Patterson-UTI expects its fourth-quarter 2021 rig count to average 53 rigs under term contracts. As the onshore driller foresees a ramp-up in drilling activity, the company expects 106 rigs, on average.

For fourth-quarter 2021, the company expects depreciation, depletion, amortization and impairment expenses to be $145 million while selling, general and administrative expenses are estimated at $24 million.

For 2021, the company expects an effective tax rate of 17%.

Zacks Rank & Key Picks

Patterson-UTI currently has a Zacks Rank #3 (Hold). Some better-ranked players in the  energy  space are Cheniere Energy LNG, Diamondback Energy, Inc. FANG and Continental Resources, Inc. CLR, each presently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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