Arabian Drilling Q1 2026 Financial Performance Summary

Arabian Drilling, a leading onshore and offshore drilling contractor based in Al Khobar, Saudi Arabia, reported a significant decline in net profit for the first quarter of 2026. The company, which manages up to 60 drilling rigs for key clients including Saudi Aramco, Al-Khafji Joint Operations (KJO), and Baker Hughes, saw its net profit drop by over 90% to 7.1 million riyals ($1.88 million), compared to 75.2 million riyals in the same period last year.

Impact of Offshore Rig Suspensions

The driller attributed the profit decline to the suspension of several operated offshore rigs and an uncertain geopolitical environment. While the company stated that these suspensions had a "limited impact" on the quarter's performance, it acknowledged that some offshore suspensions remain in place, with near-term results likely constrained until activity normalizes. Arabian Drilling noted it remains "operationally prepared" to resume offshore activity promptly once conditions improve.

Fleet Utilization and Backlog

Despite the challenges, the company's fleet utilization improved to 81.7% during the quarter, with 49 of the 60 available rigs remaining active. The active land fleet was unaffected by the offshore suspensions. As of March 31, the company's backlog reached 12.5 billion riyals, representing a 31% year-on-year increase. This growth was driven by three land rig contract extensions announced on January 13, 2026, with a total value of 1.4 billion riyals.

Management Outlook

Chief Executive Fahad Albani emphasized that the company remains "operationally prepared" to return suspended offshore rigs to service promptly once recalled, expecting utilization to improve as activity resumes. The Chief Financial Officer noted that while "near-term dynamics" related to offshore suspensions may temporarily constrain performance, the company expects margin progression to resume as activity levels normalize.