Core Viewpoint - Orbit Garant Drilling reported a rebound in activity for fiscal Q2 2026, despite some project delays, with overall revenue increasing by 10.5% year-over-year to CAD 47.9 million, although margins faced pressure due to competitive pricing and operational challenges [2][3][6]. Financial Performance - Quarterly revenue reached CAD 47.9 million, up from CAD 43.5 million in the same quarter last year, marking a 10.5% increase year-over-year [2][6]. - Gross profit decreased to CAD 6.5 million, representing 13.5% of revenue, down from 16.5% in the prior-year quarter, while adjusted gross margin fell to 18.5% from 21.5% [6][7]. - Net earnings for the quarter were CAD 1.3 million, or CAD 0.03 per diluted share, compared to CAD 0.5 million, or CAD 0.01 per diluted share, in the prior-year period [8]. Operational Insights - Drilling activity increased in both Canada and South America, with utilization improving from 56% in Q1 to 63% in Q2, and expected to reach approximately 65% in Q3 [4][15]. - The company faced operational constraints due to customer-initiated project delays and modifications, particularly in South America [3][4]. Balance Sheet and Capital Management - The company repaid a net CAD 3.3 million on its credit facility, reducing long-term debt to CAD 16.0 million [5][9]. - Working capital at quarter-end was CAD 51.9 million, up from CAD 50.4 million at the end of fiscal 2025 [10]. Market Outlook - Management anticipates further increases in utilization and revenue growth as delayed projects resume and new Canadian projects advance [11][12]. - Customer interest remains strong in Canada and South America, driven by high gold and copper prices, with increased bidding activity for new projects [13][15]. - The company expects cost inflation in supplies and wages due to sustained industry demand, which may impact future contracts and pricing [18]. Strategic Initiatives - Orbit Garant has entered into a new credit agreement with a CAD 30.0 million revolving credit facility and CAD 5.0 million for standby letters of credit, expiring on December 22, 2029 [17]. - The company repurchased 141,450 shares at a weighted average price of CAD 1.29 per share as part of its normal course issuer bid [17].