Hello, everyone, and welcome to NorAm Drilling's third quarter 2024 results presentation. My name is Marius Furuly, and I'm the Director of Strategy and Investor Relations here at NorAm Drilling. With me today on this call, I have the company's CEO and CFO, Marty Jimmerson, on the line from Houston. We will go through a presentation of the quarter results and do a recent market update before we open up for a Q&A session. Before we begin our presentation, I would like to note that this conference call and presentation will contain forward-looking statements. Words such as expects, anticipates, intends, estimates, or similar expressions are intended to identify these forward-looking statements.
Forward-looking statements are not guarantees of future performance, and these statements are based on our current plans and expectations and are inherently subject to risks and uncertainties that could cause future activities and results of operations to be materially different from those set forth in the forward-looking statements. You should therefore not place undue reliance on these forward-looking statements. So with that, Marty, please go ahead.
Marius, thank you very much, and good afternoon or good morning to all of our listeners wherever you may be today. So our third quarter 2024 highlights really were backed by WTI beginning the quarter trading around $82, and we finished the quarter around $68. Currently, WTI is trading at $69, and I think we're actually up a little bit today. U.S. rig counts were flat at 567 during the quarter, and the Permian rig counts decreased by one to 307. U.S. and Permian activity continue to be impacted by operational discipline being demonstrated by the E&Ps, as well as near-term uncertainties regarding global demand for oil. Our revenue was $26.5 million, up 6.4% from the previous quarter. Our third quarter revenue benefited from higher utilization and, to a lesser extent, higher reimbursables.
Our fleet utilization increased to 89.3% from 85.9% in the prior quarter as we transitioned two rigs to a major E&P from a customer that was acquired in a previously announced E&P merger activity earlier in the year. Adjusted EBITDA, defined as earnings before interest, tax, depreciation, amortization, plus non-cash stock option expense, was $6 million, up $1.2 million from the previous quarter. And we reported net income after tax of $700,000 or $0.02 per fully diluted share. Now turning to the next page, our recent events and providing a little outlook. During the quarter, we paid dividends of $5.2 million or NOK 1.30 per share. Our announced dividend, payable in a few days, will be our 24th consecutive monthly distribution since our listing in 2022. Our current backlog is almost $27 million as of today.
Nine of our rigs are currently operating under signed contracts of at least six-month terms. Our tenth rig continues to operate on a pad-to-pad contract and has been contracted with the same customer for several years now. As discussed last quarter, earlier, rig counts in both the Permian and U.S. continue to be flat, which we believe will continue into 2025 as a result of current WTI prices, E&P operational discipline, improved well completion efficiencies, and flat to slightly down projected 2025 E&P CapEx budgets. Natural gas prices continue to impact the U.S. total rig counts as well. Natural gas began the third quarter at $2.60 and is currently trading around $2.95. We continue to believe stability of $3 or more could be a catalyst for increased natural gas activity and demand for rigs in the U.S.
Speaking with our customers, we believe that natural gas basins could be adding rigs before the end of 2024 or early 2025. Also, the recent U.S. election results could drive increased drilling demand over the next couple of years as President-elect Trump is seeking energy independence in the U.S. We remain committed to pursuing opportunities that result in economics that justify operating our high-end super spec rigs and specifically referring to our last or 11th rig that is currently stacked. Now turning to the next page, we'll review our operational performance. We continue, as you can see on the graphs, we have recently been ranked as the number one performer by Enverus among U.S. top 10 largest land drillers, both in terms of feet drilled per day and time spent on well location.
I'd like to highlight that on the graph on the right, where the time that we've been on location of 12 days per well, that has come down over the last year from roughly 14. So again, I think it's just a complement to the quality of our rigs and our operational team, and we want to thank all of our employees for their dedication and hard work. On the market side, we see the Permian oil production growth has continued to slow, and the latest EIA figures point to only 160,000 barrels of oil per day growth year over year at the end of the third quarter.
This represents a production growth of just 3% compared to 12% at the same time two years ago and 7% one year ago, meaning that we see it as a likely scenario that Permian production growth could come to a complete halt without any increase in activity. And with that, now I would like to turn it back to Marius to review the key operational figures for the quarter.
Thank you, Marty. In the third quarter, we achieved a utilization of 89.3%, which was up from 85.9% in the previous quarter, as all of our 10 rigs were working continuously throughout the quarter without any white space. Revenues for NorAm came in at $26.5 million in Q3, up from $24.9 million in Q2, and we had an Adjusted EBITDA of $6 million, up $1.2 million from $4.8 million in Q2. On the cost side, our operating expenses decreased as repair and maintenance expenses decreased from an extraordinary level in Q2. However, we were negatively impacted by inflationary pressures on insurance premiums for rigs. Our all-in break-even was around $18,000 per day for the working rigs, and we expect this metric to remain at or around this level going forward. The idle rig is stacked at about a 30% lower cost.
On the income statement for the quarter, an operating profit of about $1 million compared to an operating loss of $153,000 in the previous quarter. Net financial income was $83,000 as a result of our debt-free balance sheet during the quarter. Third quarter net profit after tax was $700,000 versus a net loss of $277,000 in the previous quarter, and over to the balance sheet and cash flow statement. NorAm has a debt-free balance sheet and minimal investment requirements. We ended the quarter with a cash balance of $10.4 million, which is essentially flat from the previous quarter. We are again currently sitting with a little excess liquidity versus our $11 million minimum cash balance, including a non-utilized revolving credit facility of $4.5 million, and we expect the excess liquidity will be used as working capital funding for future reactivations.
And we do not expect any reactivations to interfere with our dividend policy of continuously paying out excess free cash flow from operations. During Q3, we paid out $5.2 million to our shareholders, or NOK 1.29 per share, in monthly dividends. And we have declared two monthly dividends so far in Q4. We will continue to pay dividends, subject to continued net cash flow from operations. So to conclude this presentation, NorAm has a fleet of 11 ultra super spec rigs, fully upgraded with state-of-the-art walking systems and racking capacity, with a track record of drilling the longest wells in the Permian. We are strategically positioned 100% in Permian, which is the largest U.S. shale basin, where rigs are among the very top performers in terms of drilling efficiency, measured by feet per rig per day.
We retain a top-quality customer portfolio of six E&Ps, ranging from super majors to smaller companies in Permian. We have an industry-low cash break-even level and minimal investment requirements in the rigs to keep them at the top of the market. We continue to have a clear dividend policy of returning all excess cash to our shareholders. Since our listing two years ago, we have returned $67 million to our shareholders, equal to 16.4 NOK per share. Our latest monthly cash distribution implies an annual yield north of 14% as of the closing price yesterday. We will now like to open up for questions from the audience, and please use the raise hand function, and your speaker will be unmuted. We will have our first question from Erik Aspen Fosså of Carnegie. Please go ahead, Erik.
Thank you. Hello, guys. I have two questions. The first one on dayrates. I'm not sure if you said it or wrote it somewhere, but could you tell the dayrate for this quarter and also how the trend has developed after the quarter?
Yeah, good afternoon, Erik. And so dayrates essentially were flat during the third quarter. And I would describe the current environment as stable for dayrate pricing, and I wouldn't anticipate any material changes as we move forward. What I'm most pleased about with our dayrate or with our contract renewals is that our customers continue to be very receptive to contract terms of six months or longer on renewals, and there's no pressure on well-to-well or pad-to-pad, which I think kind of is encouraging for future dayrate trends. And hopefully, we can get to a point where we can move dayrates up.
Gotcha, and the second question on the U.S. election, you also touched upon that. Do you think that that will have any meaningful effect in the near to medium term, or is it more up to the oil companies, the consultation, as you mentioned, and also how they view their capital allocation?
Yeah, Erik, I think you're right on point. I mean, first of all, I wouldn't underestimate our new president-elect for what he may be able to accomplish. He's a different person this time around, and so we'll see what happens. I do think he really is committed to trying to get to a point to where the U.S. is energy independent, and we'll see what happens. But I do share your sentiment that while he's going to attempt to increase production for both oil and gas, I think the operators are going to have a big hand in that. And accordingly, which I think is the premise of your real question, is near-term, I'm a little more cautious that we won't see any substantial change. Longer-term, maybe over the next two to three years while he's in office, I think we'll see how it plays out.
What I really think we're seeing is the need for natural gas or LNG exports to the EU could really drive an increase in activity in the US and take some supply of rigs out of the market to fulfill those needs as we move forward, which would be beneficial to everyone.
Yeah, I was just, sorry to interrupt you, Erik. I was going to say that the effect is probably expected to be more profound in natural gas, probably, in terms of the short to medium term than on oil, sorry.
Yeah, yeah, yeah, because on the premise of LNG and stuff like that, right?
Yes.
Yeah. Cool. Thank you very much, guys. That was it for me.
Thank you, Erik.
Thank you, Erik. We have another question from Marcus Månsson of Pareto. Please go ahead, Marcus.
Hey, guys. I just have one question about CapEx. How should we think about that going forward? Are the $3 million for 2024 also representative for next year? Thanks.
Yeah, and so kind of as we, 2024, I think we initially kind of had an outlook of maybe $3 million-$4 million, and we're going to be on that lower end of that range. As we move forward into 2025, I would kind of expect that same range. The needs, whether it includes high-torque pipe or not, will influence that number. But if we do bump up from the run rate of $3 million here in 2024, I wouldn't anticipate, based upon what we know, being higher than $4 million next year at this point.
All right. Thanks. That's it for me.
Thank you.
Thank you, Marcus. All right. It seems like there are no further questions from the audience. So I think we'll round it off there. Thank you all for listening, and thank you to all the NorAm employees and stakeholders for your efforts given during the third quarter. And we hope to see you again in the next quarterly conference call. Thank you. Bye.