Mccoy Global Inc. press release
McCOY GLOBAL ANNOUNCES THIRD QUARTER 2025 RESULTS AND DECLARATION OF QUARTERLY DIVIDEND
TSX - Toronto Stock Exchange · Canada
Canada NewsWire
EDMONTON, AB, Nov. 7, 2025/CNW/ -McCoy Global Inc.("McCoy," "McCoy Global" or "the Corporation") (TSX: MCB) today announced its operational and financial results for the three months ended September 30, 2025. The Corporation also announced that its Board of Directors has declared a quarterly cash dividend of $0.025per common share payable on January 15, 2026, to shareholders of record as of close of business on December 31, 2025. The dividend per common share is a regular dividend and is an "eligible" dividend for purposes of the Income Tax Act (Canada) and any similar provincial/territorial legislation.
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Third Quarter Highlights:
Reported revenue of $14.8 millionfor the quarter, a decrease of 6% from the comparative period, primarily due to the deferral of $3.4 millionin customer shipments into October, resulting from logistics scheduling and customer payment delays.
Reported smartProduct revenue of $4.0 million, accounting for 27% of total revenue (three months ended September 30, 2024 – 39%). As anticipated, smartProduct revenues were also impacted by variability in the timing of capital equipment orders and deliveries for the quarter, however, for the nine months ending September 30, 2025, smartProduct revenue totaled $30.3 million, representing 52% of total revenue, compared to 33% in the same period of 2024—an increase of $13.1 millionor 76%.
Reported net earnings of $0.6 million, on revenues of $14.8 million, an increase of 7% from the comparative period (Q3 2024 – $0.5 millionon revenues of $15.8 million). Earnings for the third quarter were impacted by the $3.4 millionreduction in throughput resulting from shipments deferred to October and timing of order intake, which limited the Corporation's ability to absorb increased production overheads and technical service support costs. This was more than offset by lower effective income taxes driven by recently enacted US tax legislation and reductions to the Corporation's incentive plan accruals.
Adjusted EBITDA1for the three months ended September 30, 2025, was $2.0 millionor 14% of revenue (Q3 2024 – $2.7 millionor 17% of revenue), with the period-over-period EBITDA margin compression largely due to the $3.4 milliondeferral of customer shipments.
Since January 1, 2025, achieved several key commercial and product development milestones:
McCoy successfully concluded in-field trials and commercialized its innovative smarTR™ system for land and shelf applications in the second quarter of 2025, which led to $11.0 millionof contract awards from our US field trial partners for system hardware. In addition to the equipment award, the contract includes utilization-based software-as-a-service (SaaS) revenue enabled by our integrated software platform for remote control, automation, and data-driven operational intelligence. With several systems delivered to date, McCoy is taking a targeted approach to commercialization—working closely with key partners to ensure the system exceeds operational expectations. With several additional systems scheduled for delivery in Q4 2025, this transformative technology that consolidates multiple tools, personnel, and processes into a single integrated solution, smarTR™ represents a significant shift in how tubular running services are executed. Given the complexity and impact of this innovation, McCoy anticipates a measured adoption curve, with ongoing iterations and refinements expected as part of the deployment process. The smarTR™ system integrates McCoy's proprietary hydraulic smart casing running tool (smartCRT™), connected flush mount spider (smartFMS™), and related tubular running accessories into a first-to-market solution that significantly enhances safety and efficiency, with the potential to significantly reduce TRS labor costs. McCoy continued to advance the commercialization of its smartCRT™ technology, delivering multiple hydraulic smartCRT™ units to the Middle Eastand the US land market throughout 2025. First introduced in Q4 2024, the hydraulic smartCRT™ has successfully executed numerous operations, demonstrating exceptional reliability and efficiency in demanding field conditions. This patented solution offers a hydraulic alternative to conventional mechanical casing running tools and is designed to integrate seamlessly into McCoy's smarTR™ system. By mitigating risks inherent in traditional CRT technologies and providing actionable performance insights, it represents a significant step forward in operational safety and optimization. Following extensive rig trials, the smartCRT™ received technical approval from a major NOC in a key market, marking a critical milestone in its commercialization and positioning it for inclusion in upcoming tenders. During the third quarter, McCoy also successfully commercialized and delivered its first external grip smartCRT™, designed for expanded casing applications—broadening the scope of McCoy's smartProduct portfolio beyond the capabilities of previous tools. McCoy successfully commercialized and delivered its 500T smartFMS™, a versatile solution that supports both drilling and casing operations while offering the enhanced load capacity required for many international well profiles. McCoy delivered a deep-water offshore integrated casing running system destined for Latin America, with commissioning scheduled for Q4 2025. Delivering this technology completes the first step on a roadmap to a comprehensive smarTR™system tailored for offshore and deep-water markets. This integrated deep-water system differs from our smarTR™solution designed for land and shelf casing operations that is centered around CRT technology, as deep-water casing installation requires hydraulic power tongs to meet technical specifications for the well profile. The Latin Americacontract award also marked the first offshore commercial SaaS purchase commitment for McCoy's Virtual Thread-Rep™technology. McCoy's Virtual Thread-Rep™technology enables customers to remotely monitor and control premium connection make-up. It also facilitates the autonomous evaluation and confirmation of premium connection make-up on location. Following quarter-end, McCoy received a $3.7 millionpurchase commitment for integrated hydraulic power tong systems intended for deep-water offshore operations in the Eastern Hemisphere, with delivery scheduled for Q1 2026. Declared a quarterly cash dividend of $0.025per common share payable on January 15, 2026, to shareholders of record as of close of business on December 31, 2025.
"In the third quarter, we made meaningful progress advancing our Technology Roadmap. We continued the targeted commercialization of our smarTR™ system, delivering initial systems and working closely with field partners to validate performance in live operations. This deliberate approach ensures the system meets operational expectations and supports long-term adoption," said Jim Rakievich, President & CEO. "We also commercialized our 500T smartFMS™ and external grip smartCRT™, expanding the capabilities of our smartProduct portfolio. Importantly, our hydraulic smartCRT™ has received technical approval from a major National Oil Company (NOC), strengthening our position for upcoming tender opportunities. Contract awards under this tender are expected to be announced in Q1 2026, with mobilization anticipated by Q3. While final timelines are at the discretion of the NOC, strategic working capital investments have been made to ensure we are fully prepared to meet delivery demands throughout 2026."
"Our third quarter results highlight the inherent variability of capital equipment markets, where timing of shipments and customer investment decisions can shift between periods, particularly under the current market backdrop. While revenue was impacted by deferred deliveries and order timing, we delivered earnings and generated cash flow from operations in the quarter. Looking ahead, we see meaningful opportunities tied to upcoming NOC tenders and remain confident in our ability to convert active quoting into confirmed orders." said Lindsay McGill, Vice President & CFO. "We have, and continue to, proactively manage costs and capital expenditures; however, our priority remains investing in strategic initiatives that support long-term growth. We're focused on maintaining financial flexibility while ensuring we don't compromise our ability to capitalize on future opportunities due to short-term variability."
Third Quarter Financial Highlights:
Total revenue of $14.8 million, compared with $15.8 millionin Q3 2024;
Net earnings of $0.6 million, compared to $0.5 millionin Q3 2024;
Adjusted EBITDA1of $2.0 million, or 14% of revenue, compared with $2.7 million, or 17% of revenue, in 2024;
Booked backlog2of $27.7 millionat September 30, 2025, compared to $30.1 millionin the third quarter of 2024. Subsequent to the quarter ended September 30, 2025, McCoy received a $3.7 millionpurchase commitment for integrated hydraulic power tong systems intended for deep-water offshore operations in the Eastern Hemisphere, with delivery scheduled for Q1 2026;
Book-to-bill ratio3was 1.17 for the three months ended September 30, 2025, compared with 1.53 in the third quarter of 2024.
Financial Summary
Revenue of $14.8 millionfor the three months ended September 30, 2025, decreased 6% from the comparative period. The decline was primarily attributable to $3.4 millionin customer orders were initially scheduled for shipment in September, however due to logistics scheduling and delays in receipt of customer payment, the shipments and corresponding revenue was deferred into October. As anticipated, smartProduct revenues were impacted by variability in the timing of capital equipment orders and deliveries contributing to fluctuations in revenue between reporting periods. For the three months ended September 30, 2025, smartProduct revenue totaled $4.0 millionand accounted for 27% of total revenue (three months ended September 30, 2024– 39%). For the nine months ended September 30, 2025, revenue increased by 11% to $58.2 million, driven by continued momentum in the adoption of McCoy's smartProducts. This growth was supported by the successful commercialization of the smarTR™ technology platform and the delivery of multiple systems to a leading US tubular running services (TRS) provider. For the nine-month period, smartProduct revenue totaled $30.3 million, representing 52% of total revenue, compared to 33% in the same period of 2024—an increase of $13.1 millionor 76%.
Gross profit, as a percentage of revenue, for the three and nine months September 30, 2025, was 22% and 32% respectively, a decrease of twelve and three percentage points from comparative periods in 2024. Gross profit was impacted by reduction in throughput during the third quarter resulting from deferred shipments and timing of order intake, which limited the Corporation's ability to absorb increased production overheads and technical service support costs.
For the three and nine months ended September 30, 2025, general and administrative expenses (G&A) were $1.6 millionand $9.1 million, respectively, a decrease of forty percentage points and an increase of forty-three percentage points, respectively. The fluctuations in G&A between reporting periods have been related to stock-based compensation expense, reflecting the mark-to-market impact of the Corporation's share price appreciation on cash-settled awards. For the three months ended September 30, 2025, total share-based compensation expense was $0.1 million, compared to $0.7 millionin the comparative period, while total share-based compensation expense for the nine months ended September 30, 2025, was $2.4 million(2024 – $0.7 million). To a lesser extent, G&A was also impacted by increased investment in corporate functions including information technology, human resources and administrative support, offset by lower accrued employee short-term incentives.
For the three and nine months ended September 30, 2025, sales and marketing expenses were $0.5 millionand $2.1 million, respectively. Sales and Marketing expenses reflect increased investment in the Corporation's technical salesforce during the second half of 2024 and the first half of 2025, as well as enhanced marketing efforts to support the accelerated adoption of the Corporation's smartProducts portfolio. These increases were largely offset by lower accrued short-term incentive expense. As a percentage of revenue, Sales & Marketing decreased three percentage points and were unchanged, respectively, compared to the comparative periods.
With total product development and support expenditures of $2.2 millionand $5.7 millionduring the three and nine months ended September 30, 2025, respectively, the Corporation further advanced its 'Digital Technology Roadmap' initiative through continued focus on accelerating customer adoption of new technologies as well as the design and development of additional 'smart' product enhancements, including the recently commercialized 500T smartFMS™and external grip smartCRT™. For the remainder of 2025, the Corporation has committed up to US$0.5 millionof capital toward the development of additional product offerings. For the three months ended September 30, 2025, product development and support expenses decreased from the comparative period due to lower employee short-term incentive accruals. For the nine months ended September 30, 2025, product development and support expenses increased from the comparative period. This was primarily due to investment in engineering and technical personnel, increased travel related to new product deployment and customer support activities, and higher intellectual property expenditures, partially offset by lower employee short-term incentive accruals.
Net earnings for the three months ended September 30, 2025, were $0.6 millionor $0.02per basic share, compared with net earnings of $0.5 millionor $0.02per basic share in the third quarter of 2024. Adjusted EBITDA1for the three months ended September 30, 2025, was $2.0 millioncompared with $2.7 millionfor the third quarter of 2024.
As at September 30, 2025, the Corporation had $3.5 millionin cash and cash equivalents.
Selected Quarterly Information
| ($000 except per share amounts and percentages) | Q3 2025 | Q3 2024 | % Change | | Total revenue | 14,828 | 15,842 | (6 %) | | Gross profit | 3,307 | 5,349 | (38 %) | | as a percentage of revenue | 22 % | 34 % | (12 %) | | Net earnings | 554 | 516 | 7 % | | as a percentage of revenue | 4 % | 3 % | 1 % | | per common share – basic | 0.02 | 0.02 | - % | | per common share – diluted | 0.02 | 0.02 | - % | | Adjusted EBITDA1 | 2,029 | 2,668 | (24 %) | | as a percentage of revenue | 14 % | 17 % | (3 %) | | per common share – basic | 0.08 | 0.10 | (20 %) | | per common share – diluted | 0.07 | 0.10 | (30 %) | | Total assets | 92,637 | 81,154 | 14 % | | Total liabilities | 28,515 | 22,690 | 26 % | | Total non-current liabilities | 1,671 | 2,434 | (31 %) |
Summary of Quarterly Results
| ($000 except per share amounts) | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | | Revenue | 14,828 | 24,051 | 19,346 | 25,222 | 15,842 | 19,910 | 16,542 | 19,699 | 16,878 | | Net earnings | 554 | 1,367 | 946 | 4,255 | 516 | 3,125 | 975 | 2,674 | 1,900 | | as a % of revenue | 4 % | 6 % | 5 % | 17 % | 3 % | 16 % | 6 % | 14 % | 11 % | | per share – basic | 0.02 | 0.05 | 0.03 | 0.16 | 0.02 | 0.12 | 0.04 | 0.10 | 0.07 | | per share – diluted | 0.02 | 0.05 | 0.03 | 0.15 | 0.02 | 0.11 | 0.04 | 0.10 | 0.07 | | EBITDA1 | 1,630 | 2,978 | 2,296 | 5,598 | 1,826 | 4,638 | 2,191 | 3,001 | 3,641 | | as a % of revenue | 11 % | 12 % | 12 % | 22 % | 12 % | 23 % | 13 % | 15 % | 22 % | | Adjusted EBITDA1 | 2,029 | 4,817 | 3,479 | 6,534 | 2,668 | 4,728 | 2,273 | 3,987 | 3,856 | | as a % of revenue | 14 % | 20 % | 18 % | 26 % | 17 % | 24 % | 14 % | 20 % | 23 % |
Outlook and Forward-Looking Information
Throughout the third quarter of 2025, global energy markets continued to face headwinds stemming from a complex mix of macroeconomic and geopolitical developments leading to a notable decline in market conditions across several global regions. While the lifting of OPEC+ production quotas and geopolitical disruptions were key drivers of instability in the second quarter, their lingering effects—combined with ongoing macroeconomic uncertainty—have continued to influence customer sentiment. These factors have contributed to increased customer prudence, particularly in capital equipment procurement, resulting in deferred investment decisions, subdued activity levels across key regions, and a shift in focus toward cash flow preservation and operational efficiency.
While drilling activity remained subdued and certain National Oil Company (NOC) contract tenders continued to face delays, medium-term fundamentals for the oil and gas sector are expected to remain constructive, particularly across the Middle Eastand North Africa(MENA) region. Recent TRS contract tenders awarded in one of our largest markets have been favourable for McCoy, with several tools scheduled for delivery in Q4 2025; however, customer capital constraints have introduced market headwinds and have led to increased demand for rental tools and alternative financing arrangements. Over the next twelve months, several additional TRS contract awards are anticipated across key Eastern Hemisphere markets, representing a cumulative opportunity of over 100 rigs—all requiring casing running tools. Encouragingly, McCoy's smartCRT™ received technical approval from a major NOC in a key market for the upcoming tender, marking a significant milestone in the product's commercialization and driving increased quoting activity. While the timing of these contract awards remains at the discretion of the NOC, rig allocations for our TRS customers under this tender are expected to be announced in Q1 2026, with mobilization anticipated by Q3. With its strategic working capital investments, McCoy is well positioned to convert active smartProduct quotes into confirmed orders, supported by its differentiated technologies, expanded product capabilities, and strong local technical expertise.
In the North American land market, drilling activity continued to trend downward through the third quarter, with rig counts declining further from Q2 levels and reaching some of the lowest points observed since early 2021. Despite these headwinds, revenue from this region has been supported by McCoy's smartProduct technologies, particularly the smarTR™ system. While initial deliveries of smarTR™ systems have begun, the Corporation is taking a targeted and deliberate approach to commercialization, working closely with select partners to ensure the system exceeds performance expectations in the field. As a transformative solution that streamlines multiple tools, roles, and workflows into a unified system, smarTR™ marks a fundamental evolution in how tubular running services are delivered. Due to the complexity and operational impact of this innovation, McCoy expects adoption to follow a deliberate and iterative path, with continuous refinements informed by field experience and customer feedback.
Although the current market environment may temper the pace of adoption and near-term revenue growth, McCoy remains confident in its Technology Roadmap initiative. Leading E&P companies have reinforced their commitment to safety through "clear the floor" initiatives, creating a meaningful opportunity for innovative solutions, like McCoy's smarTR™, that align with these evolving standards. As commercialization progresses, future revenue streams are expected to become increasingly driven by technology adoption rather than the cyclicality of drilling activity. McCoy's smartProduct portfolio continues to deliver meaningful improvements in safety, operational efficiency, and cost reduction, positioning the Corporation to deliver enhanced value to customers even in challenged market conditions. As operators seek to differentiate and drive performance at lower cost, McCoy's smart solutions are increasingly aligned with their strategic priorities.