NorAm Drilling reported a 64% rise in net profit for the second quarter of 2026, driven by near-perfect rig utilization and higher revenue. The Permian Basin-focused drilling contractor posted net income of $4.2 million, up from $2.6 million in the prior quarter, according to slides released on August 26.
Revenue increased 12.3% sequentially to $29.4 million, while adjusted EBITDA climbed 40% to $6.3 million. Operating profit rose 62% to $4.8 million. The company’s 11 modernized ultra super-spec rigs achieved 98.6% utilization in Q2, up from 90.3% in Q1, with all rigs remaining contracted throughout the quarter. Two rigs were reactivated late in the first quarter, contributing to the improved utilization rate.
The company’s backlog stood at $30.3 million as of August 25, with seven of its 11 rigs operating under term contracts ranging from six to 12 months. The Permian Basin’s active rig count rose by 17 units to 258 during the quarter, leaving fewer than 10 super-spec rigs available in the basin.
NorAm Drilling’s cash position strengthened, with operating cash flow of $6.4 million and $8.1 million in cash at quarter-end. The company maintained a debt-free balance sheet with total equity of $56.9 million. Dividends paid in the quarter totaled $4.9 million, marking the 45th consecutive monthly distribution. Total cash distributions since December 2022 have reached approximately $100 million, with the latest monthly payout at $0.045 per share.
Per-rig metrics showed mixed trends. Direct margin declined slightly to $8,928 per day, while net cash flow margin decreased to $5,873 per day. Maintenance and capital expenditure allocations rose to $757 per day, up from $275 in Q1. The all-in cash breakeven cost for working rigs increased to $18,678 per day.
CEO and CFO Marty Jimmerson noted that private operators typically maintain drilling activity as long as WTI crude prices remain above $70 per barrel, face budget pressure in the $65–70 range, and may reduce spending if prices fall below $65. WTI crude prices have climbed roughly $15–25 per barrel year-to-date, with real-time data showing levels around $82.27 per barrel. The forward curve suggests prices starting near $85 per barrel before gradually declining to about $70 by December 2029.
