The Company is a provider of contract drilling, service rig and ancillary services to oil and natural gas exploration and production companies in Canada and the United States.
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Return to dividend?
PDS might well be a perfect POSTER CHILD for a turnaround company. The Gray Wolfe acquisition might have been a good move if it had not been for the fact that the energy market was about to collapse. I would prefer that they continue to pay down debt rather than pay dividends currently. The debt is at interest rates which are well beyond todays market, so by paying down those old, expensive obligations, the company's credit rating will continue to improve. By employing this strategy, they are doing a better job at building shareholder value. They have also used money that could have been used to pay dividends to upgrade their rig fleet, which commands a much higher lease rate than the older equipment. I think they are on the right track. The percentage of the fleet which is active is at an all time high, with very little "dead wood" equipment sitting idle. Idle rigs really kill the profit margins, and conversely a very busy fleet of equipment is great for the bottom line-for all of us. I've almost doubled my money on PDS in two years, so I'm a happy camper.