Good morning, ladies and gentlemen, and welcome to Orbit Garant Drilling's Fiscal 2021 Q4 and Year-end Results Conference Call and Webcast. At this time, all lines are in listen-only mode. Following management's remarks, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator.
Please be aware that certain information discussed today may be forward-looking and that actual results could differ materially. Certain non-IFRS financial measures will also be discussed. Please refer to the company's SEDAR filings for additional information on both risk factors and non-IFRS measures. This call is being recorded on Wednesday, September 29th, 2021. I would now like to turn the conference over to Mr. Eric Alexandre, President and CEO of Orbit Garant. Please go ahead.
Thank you, Chris. Good morning, ladies and gentlemen. With me on the call is Daniel Maheu, CFO. Following my opening remarks, Daniel will review our financial results, and I will conclude with comments on our outlook. We will welcome questions. We had record high revenue in meter drill in the Q4. Revenue total, CAD 51.1 million, up from CAD 20.2 million in Q4 last year, when we were severely impacted by restrictions related to COVID-19.
We drilled approximately 502,000 m in the quarter, compared to 186,000 m in Q4 last year. These results reflect the strong recovery in customer demand following the initial negative impact of COVID-19, beginning late in the Q3 of fiscal 2020. The recovery is supported by continued strength in metal prices, with the spot price of gold currently at approximately $1,735 an ounce, and copper price at $4.19 per pound.
Our drilling activity in Canada returned to pre-pandemic levels in the second half of fiscal 2021 and surpassed those levels in recent months. We also drilled significantly more meters in West Africa and Guyana in Q4 this year compared to last year. In Chile, our drilling activity continues to be impacted by challenges related to COVID-19 and has not returned to pre-pandemic levels.
However, demand in that market is ramping up. As I noted on our last conference call, we commenced a new long-term contract with a major copper producer in Chile during our Q3. Our margins were impacted in the quarter by increased driller training, project mobilization, and ramp-up costs as we continue to adapt our operation to meet the higher level of customer demand.
Looking ahead, we expect higher labor costs in Canada due to an industry-wide shortage of experienced drillers and higher material costs due to supply chain issue related to the pandemic. However, we expect to offset these cost increase with higher contract pricing. We have already begun this process. Our customers have been receptive.
We are well-positioned to manage the shortage of experienced driller in Canada through our drilling training program and our computerized drill technology, which accelerates the learning process for less experienced driller. We currently have a significant number of new recruits enroll in our training program. Overall, we expect that our capacity utilization and driller productivity will gradually increase as this positive business cycle progress, enabling us to generate stronger margins.
We will continue to carefully monitor the pandemic, taking all the necessary measures to prioritize the health and safety of our employees and other stakeholders, including the communities in which we operate. I will now turn the call over to Daniel to review our Q4 and fiscal 2021 financial results in more detail. Daniel?
Thank you, Eric, and good morning, everyone. Our fiscal 2021 Q4 revenue totaled a record of CAD 51.1 million, a significant increase compared to CAD 20.2 million in Q4 a year ago, when our performance was negatively impacted by project suspension and slowdowns related to the pandemic. Canada revenue totaled CAD 38.1 million in the quarter, up from CAD 16.4 million in Q4 last year, reflecting strong domestic demand during the quarter and the negative impact of the pandemic in Q4 last year.
International revenue was CAD 13 million, up from CAD 3.8 million in Q4 last year. The increase reflects increased drilling activity in West Africa, the commencement of a new project in Chile, and the negative impact of the pandemic in Q4 last year. Our drill utilization rate was approximately 66% in the quarter, compared to 42% in Q4 a year ago.
The last time we had a drill utilization rate that high was the Q2 of fiscal 2018. Gross profit for the quarter increased to CAD 3 million compared to CAD 2.3 million in Q4 last year. Adjusted gross margin, excluding depreciation expenses, was 9.8% compared to 23.3% in Q4 last year. Gross profit and margins were impacted by increased driller training and project ramp-up costs in Canada and significant mobilization costs related to new long-term contract in Guinea and Chile.
The year-over-year decline in gross margins also reflects a lower level of financial support in Q4 this year from the Canada Emergency Wage Subsidy Program or CEWS. Our cost of contract revenue was reduced by CAD 0.1 million in Q4 this year due to the support of the CEWS program, compared to CAD 3.2 million in Q4 last year. G&A expenses were CAD 3.9 million in the quarter, or 7.7% of revenue, compared to CAD 2.9 million, or 14.1% of revenue in Q4 last year.
The increase in G&A expenses reflects greater drilling activity. G&A expenses in Q4 last year were also reduced by CAD 0.4 million due to the financial support from the CEWS program. There was no such reduction in Q4 this year. EBITDA for the quarter increased to CAD 1.2 million compared to CAD 0.3 million in Q4 last year. Net loss was CAD 2.2 million, or CAD 0.06 per share, compared to a net loss of CAD 2.7 million, or CAD 0.08 per share in Q4 a year ago. The positive variances are a result of increased drilling activity.
The net loss of Q4 this year reflects increased driller training, project ramp-up and mobilization costs, and the important reduction of the financial support from the CEWS program compared to Q4 a year ago. Turning to the results for the fiscal year ended June 30th. Revenue for fiscal 2021 totaled CAD 163.3 million, an increase of 18.5% compared to fiscal 2020, primarily reflecting increased drilling activities in Canada and West Africa.
Canada revenue was CAD 130 million, an increase of 19.2% compared to fiscal 2020. The increase reflects the ramp-up in our drilling domestic operation following the project shutdown and slowdown related to COVID-19, which began in late Q3 2020. As Eric noted, our drilling activity in Canada returned to pre-pandemic levels in the second half of fiscal 2021 and more recently surpassed those levels.
International revenue totaled CAD 33.3 million, an increase of 15.7% compared to fiscal 2020, reflecting increased drilling activity in Burkina Faso, Guinea, and Guyana, partially offset by lower drilling activities in Chile and Argentina. Gross profit in fiscal 2021 increased to CAD 20.3 million compared to CAD 12.9 million in fiscal 2020. Adjusted gross margin, excluding the depreciation expenses, was 17.9% compared to 16.3% in fiscal 2020.
Gross profit and margin in fiscal 2021 were positively impacted by increased drilling activity, improved operational efficiencies, and cost reduction initiatives. These factors offset additional logistical challenges and related costs due to the COVID-19, significant mobilization costs in Guinea and Chile in the second half of fiscal 2021, and increased driller training and project ramp-up costs in Canada during Q4 2021.
The cost of contract revenue was reduced by CAD 2.9 million in fiscal 2021 due to the fiscal support record from the CEWS program compared to CAD 3.2 million last year. G&A expenses in fiscal 2021 were CAD 14.5 million, or 8.9% of revenue, compared to CAD 15.4 million or 11.2% of revenue in fiscal 2020. The decline in G&A expenses reflect the cost reduction measures that were implemented following the onset of the pandemic.
G&A expenses were reduced by CAD 0.3 million in fiscal 2021 due to the support financials record from the CEWS program, compared to CAD 0.4 million in fiscal 2020. EBITDA increased to CAD 17.6 million in fiscal 2021 compared to CAD 6.8 million last year. Net earnings for fiscal 2021 were CAD 2.3 million, or CAD 0.06 per share, compared to a net loss of CAD 7.4 million or CAD 0.20 per share last year.
The positive variance reflects improved gross margin and the reversal of a provision for litigation in Burkina Faso during Q3 2021, totaling CAD 1.96 million. These factors were partially offset by increased driller training and project ramp-up costs during Q4 2021, and a new project mobilization cost during the second half of fiscal 2021. Now turning to our balance sheet.
During fiscal 2021, our financing activities result in a CAD 3.8 million reduction in debt and lease liabilities. Cash flow of CAD 2.9 million were generated from financing activities in fiscal 2020. We repay a net amount of CAD 4.4 million on our credit facility in fiscal 2021, compared to a withdrawal of CAD 3.2 million last year.
Our long-term debt under the credit facility, including $1 million U.S. draw from our $5 million U.S. revolving facility, and the current portion was CAD 24.3 million as at fiscal year-end, compared to CAD 28.7 million as at June a year ago. This decrease of CAD 4.4 million has provided us improved financial flexibility. As at June 30th, 2021, our working capital position was CAD 54 million, compared to CAD 52.1 million as at the end of fiscal 2020. I now turn the call back to Eric for closing comments. Eric?
Thanks, Daniel. We are well-positioned to continue building on our strong momentum in Q4. This outlook is supported by strong market conditions. Global exploration activity is currently very high. It is expected to continue growing. According to a recent report from S&P Global Market Intelligence, exploration budgets for non-ferrous metals are expected to increase 25%-35% in this calendar year from CAD 8.7 billion in 2020.
Further growth is expected in 2022. With strong metal prices, precious and base metal mining companies are generating strong cash flows and have a strong incentive to increase exploration spending. COVID-19 continue to be a concern. Canada is currently being impacted by a fourth wave. We are carefully monitoring our other markets as well. We are encouraged by the steady uptick in global vaccinations.
If operating restriction related to COVID-19 do increase in our markets, we are positioned to rapidly respond. With our highly skilled team, strong balance sheet, state-of-the-art technology, and presence in leading copper and gold mining markets, we are well-positioned to capitalize on what appears to be the beginning of a strong market cycle. As we expand our team of drillers in Canada and increase pricing on contracts, we expect to gradually generate increased profitability.
We are pleased to have recovered so rapidly from the negative impact we experienced early in the pandemic and look forward to pursuing further opportunities to grow our business and build shareholder value. That concludes our formal remarks. Daniel and I will now be pleased to answer any question. Chris, please begin the question period.
Thank you. Ladies and gentlemen, we will now begin the question- and- answer session. Should you have a question, please press star followed by one on your touch tone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be polled in the order they are received.
Should you wish to decline from the polling process, please press star followed by two. If you are using a speakerphone, please lift the handset before pressing any keys. Your first question comes from Gordon Lawson, Paradigm Capital. Gordon, please go ahead.
Hi. Good morning.
Good morning.
Congratulations on another excellent quarter.
Thank you.
Could you please comment on your training, mobilization, and ramp-up costs and where we stand on these issues since quarter end?
Well, this is something that is very challenging right now according to what is happening in Canada about the lack of experienced driller availability. What we did in the past up cycle, we did start the training program internally, and this had been start this year very early, I mean, in January, where we had the groups coming up in smaller groups according to COVID-19 restriction.
We're training people that are trained as basic employees, goes in as a third man in our operation, and those costs are extra cost to our operation. We have to sustain this group of people inside the operation. By the time that those people get to a point where they can be a driller helper and reaching a reasonable productivity, it takes a learning curve. Usually, it's like a six-month period.
While we start this in January and we keep going doing this because we are still missing people in our operation as other peers, we see that our operation will be impacted by this. We are doing really well in the past cycle, and we do the same thing right now, and combined to this, we have the technology that helps us as well to train the people rapidly as opposed to conventional drills where it takes a longer time period to reach reasonable targets .
We do expect this to be a challenge moving forward. It is something that sometimes you wake up in the night and say what we can do else to attract more people. I think this situation is reflected in other industry as well, and we have been able in the past to do better than the others on that side.
Okay. Thank you. One more, if I may. As for the current commodity price environment, what are you seeing on your end in terms of gold versus copper demand for drilling contracts and particularly as, excuse me, as it relates to specialized drilling?
If we start with gold, it's crazy. There is a lot more demand than offer. That creates an environment where we increase our prices as well as some of our costs are increasing, like the drilling consumables, as well as the wages for the employees to be paid. We have been able to manage this with the client by price increase and offset those increase on that side. We do see gold improving everywhere in all our sector.
Like West Africa, it is the same. For copper, it's a little bit different because we are still challenging in Chile, especially because our operation are there with COVID-19 restriction. Despite the fact that the vaccination rate is very high, we do see more cases there in Chile that impact our operation right now and slow down our operation as well as for our peers.
We did not recover from pre-pandemic level there in Chile. What is encouraging is the price for copper reserve are depleting again and they will need some more exploration out there. We know that at some point, this will come back to normal. Actually, we have to support some fixed costs in this branch without the revenue associated to it, and we do think that it's a temporary situation, and we hope that we're going to get back on track in this country with more demand.
Okay, great. Thank you very much.
Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star followed by one on your touch- tone phone. Your next question comes from Terry Bolima. Terry, please go ahead.
Thank you. Was the adjusted gross profit margin in the quarter somewhere between 20%-25% without the training and upfront ramp-up costs?
Sorry, Terry, I missed the last part and the line was bad. Could you repeat, please?
Sure. Was the adjusted gross profit percent in the quarter in the 20%-25% area if we exclude the training and upfront costs, ramp-up costs and so forth? The one-time cost, if we take those out. Yeah.
Yeah. Well, it's difficult to say exactly. You're right. We should expect those 20%-25% gross margin moving forward. You have to think that we still ramp up our operation and there is still room for improvement in terms of revenue. If we keep going that pace and accepting new challenges there and putting more contracts out there, we'll need to support some training as well. With price increase and everything happening in the market, we do expect margins improving.
Mm-hmm. Okay. The second question. Orbit stock trades at 0.3x enterprise value to sales next 12 months pace. Major Drilling trades at 1.3x enterprise value to sales next 12 months pace. Your other publicly traded competitor, Foraco, trades at 1x enterprise value to sales next 12 months pace. Orbit stock would have to more than double just to catch up to Foraco valuation and triple to reach Major Drilling's valuation. What does management see as the reason or reasons for the big discrepancy in the valuations from Orbit? Yeah.
Well, Terry, it's difficult to answer this question because there's many factors that impact this. First of all, Major is a larger company there, and we do see that we could be below their valuation out there because of the size. Foraco, then it's different because there was a debt reclassification in shares and everything.
We do see that we are undervalued, of course, as opposed to our peers. This is an opportunity for a potential investor as well. It shows that our stock could go up compared to the others. That means that it's time to get in. For me, that's what it says. We're going to do what we have to do in order to address this, for sure.
The first thing is continuing to managing this company carefully and continuing to grow and staying very accurate on our strategy out there and very disciplined in what we are doing. This is what we did in the past, and this has paid off on the road. We will continue to do as is.
Yes. Okay, good. Lastly, does management see this cycle unfolding similar to 2004? Such that 2019 or 2020 is similar to 2004? Does it have the same factors to it? Do you think it's the same type of cycle that's coming up that went from 2004 to 2012?
Well, Terry, it's a good question. In 2004, there was a lack of reserves, and reserves were depleting. There was money that was not invested in exploration at that time, and was a lack between the discoveries and what the demand was asking. That creates the perfect momentum to increase metal prices and increasing financing for our clients there. That was generated for this.
At that time, we didn't have the manpower effect. We were able to attract some experienced driller at that time. Of course, we had the training program, but this time we are more affected by this. This time it's the same driver where we didn't have any big discoveries in the last upcycle, which is a good news for us.
This will request more drilling activity, as well as there is a lot more impact about health and safety and environmental protection, and that's another point. That requires more specialized drilling down the road and more performer like Orbit Garant to perform. This is good news for us, as well as right now, this cycle is more pumped up by other things like the electric cars that was not present last time.
We have more drivers right now, and we do think that we are entering in a very good upcycle right now, and this is all good for our company. We are very positive on what is coming up. Of course, we stay careful with the COVID-19 pressure and everything out there, so we still manage carefully not to position ourselves in a difficult period where you see COVID-19 affecting your operation. We are very encouraged with what we see so far with the demand we are receiving from our clients.
Mm-hmm. Super. Those were my questions. Thank you.
Thank you, Terry. Have a good day.
Thank you. There are no further questions at this time. Please proceed.
Thank you very much for participating. We will end this call. Thank you very much and see you next quarter.
Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.