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High Arctic Energy Services Inc (TSE:HWO)
TSX:HWO
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High Arctic Energy Services
(TSX:HWO)
54Neutral
High Arctic Energy Services (HWO) vs. S&P 500 (SPY)
Market Cap
$10.67M
Dividend Yield24.72%
Average Volume (3M)9.45K
Price to Earnings (P/E)0.4
Beta (1Y)0.52
Revenue Growth-59.34%
EPS GrowthN/A
CountryCA
Employees15
SectorEnergy
Sector Strength50
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)2.27
Shares Outstanding12,696,959
10 Day Avg. Volume8,222
30 Day Avg. Volume9,453
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.32
Price to Cash Flow (P/CF)1.00
P/FCF Ratio1.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
High Arctic Energy Services Business Overview & Revenue Model
Company DescriptionHigh Arctic Energy Services (HWO) is a Canada-based company that operates within the oilfield services sector, primarily focused on providing specialized equipment and services to exploration and production companies in the oil and gas industry. The company's core offerings include drilling, well servicing, and rentals of specialized oilfield equipment. High Arctic Energy Services is recognized for its expertise in operating in remote and harsh environments, particularly in Canada and Papua New Guinea.
How the Company Makes MoneyHigh Arctic Energy Services generates revenue through multiple streams, primarily centered around its oilfield services and equipment rental divisions. The company earns income by providing drilling and well servicing operations, which involve the deployment of its specialized rigs and experienced personnel to client sites. Additionally, High Arctic rents out oilfield equipment, such as drilling rigs and support tools, to exploration and production companies, which contributes significantly to its revenue. The company's earnings are bolstered by long-term contracts and partnerships with major oil and gas producers, ensuring a steady flow of business. Furthermore, High Arctic's focus on operating in challenging environments allows it to command premium pricing for its specialized services and expertise.
High Arctic Energy Services Financial Statement Overview
Summary
High Arctic Energy Services faces challenges in stabilizing its operations, as seen in the volatile revenue and profitability figures. While the balance sheet reflects a conservative financial structure with low leverage, asset reductions and declining equity are concerns. The cash flow statement shows some positive trends in operating cash flow, but cash outflows in investing and financing activities may pose risks. Overall, the company needs to address its revenue decline and improve operational efficiency to enhance financial health.Income Statement
The company has experienced significant volatility in revenue and profitability over the years. Revenue has decreased from $185.5 million in 2019 to $10.47 million in 2024, indicating a negative growth trajectory. Despite a positive net income in 2024, previous years have shown significant net losses. Margins have been inconsistent, reflecting operational challenges.40
Negative
Balance Sheet
The company maintains a relatively low debt-to-equity ratio, suggesting prudent financial leverage. However, a declining equity base and the reduction in assets highlight financial weakening. The equity ratio remains strong, indicating a solid ownership structure despite asset reduction.55
Neutral
Cash Flow
Operating cash flow has shown improvement in recent years, and free cash flow has been positive. The free cash flow growth has been inconsistent, but recent figures are encouraging. However, negative investing and financing cash flows suggest potential cash management issues.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 10.47M | 61.93M | 80.02M | 76.44M | 90.80M | Gross Profit |
| 2.61M | 11.31M | -5.78M | -8.42M | -14.20M | EBIT |
| -2.96M | 1.35M | -16.57M | -19.47M | -27.80M | EBITDA |
| 724.00K | -111.00K | -9.41M | 4.43M | 10.40M | Net Income Common Stockholders |
| 28.31M | -13.14M | -36.58M | -18.61M | -25.90M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 3.12M | 50.33M | 19.56M | 12.04M | 32.60M | Total Assets |
| 30.87M | 123.14M | 133.96M | 185.45M | 214.20M | Total Debt |
| 4.66M | 6.35M | 5.70M | 16.52M | 19.20M | Net Debt |
| 1.54M | -43.98M | -13.86M | 4.48M | -13.40M | Total Liabilities |
| 9.76M | 23.80M | 18.73M | 36.60M | 36.90M | Stockholders Equity |
| 21.11M | 99.33M | 115.23M | 148.85M | 177.30M |
| Cash Flow | Free Cash Flow | |||
| 12.33M | 9.26M | 3.79M | -9.04M | 14.80M | Operating Cash Flow |
| 14.27M | 11.22M | 7.86M | -1.80M | 19.70M | Investing Cash Flow |
| -23.09M | 24.21M | 6.65M | -5.57M | -1.20M | Financing Cash Flow |
| -39.10M | -3.93M | -6.74M | -13.39M | 5.10M |
High Arctic Energy Services Technical Analysis
Negative
0.84
Price Trends
1.00
Negative
1.06
Negative
1.43
Negative
Market Momentum
-0.06
Negative
43.39
Neutral
78.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HWO, the sentiment is Negative. The current price of 0.84 is below the 20-day moving average (MA) of 0.86, below the 50-day MA of 1.00, and below the 200-day MA of 1.43, indicating a bearish trend. The MACD of -0.06 indicates Negative momentum. The RSI at 43.39 is Neutral, neither overbought nor oversold. The STOCH value of 78.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:HWO.
High Arctic Energy Services Peers Comparison
Overall Rating
UnderperformOutperform
Sector (55)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | C$350.07M | 5.91 | 11.04% | 4.02% | 2.65% | 52.69% | |
75 Outperform | C$777.98M | 7.46 | 21.89% | 4.49% | 0.84% | -1.74% | |
70 Outperform | $1.38B | 7.47 | 26.23% | 2.14% | 8.79% | 31.76% | |
67 Neutral | $815.69M | 7.66 | 6.58% | ― | -1.90% | -52.33% | |
55 Neutral | $7.11B | 3.51 | -6.23% | 6.00% | >-0.01% | -51.70% | |
54 Neutral | $10.67M | 0.37 | 2.07% | 24.72% | -59.34% | ― | |
53 Neutral | C$359.07M | 14.37 | -1.55% | ― | -6.00% | -150.20% |
* Energy Sector Average
Performance Comparison
TSE:HWO
High Arctic Energy Services
0.84
-1.55
-64.81%
TSE:CEU
CES Energy Solutions
6.19
0.61
10.85%
TSE:PD
Precision Drilling
59.66
-39.25
-39.68%
TSE:TCW
Trican Well Service
4.13
-0.03
-0.70%
TSE:ESI
Ensign Energy Services
1.98
-0.54
-21.43%
TSE:TOT
Total Energy Services
9.20
-0.52
-5.35%
High Arctic Energy Services Earnings Call Summary
Earnings Call Date: Mar 31, 2025 | % Change Since: -28.21% | Next Earnings Date: May 9, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with significant achievements in the reorganization and strong performance in Canadian operations. However, challenges in the PNG and Alaskan operations, along with delayed project timelines, balanced the positive aspects.Highlights
Successful Reorganization and Spin-Off
High Arctic has completed its reorganization, resulting in the spin-off of the PNG business into a new publicly listed entity named High Arctic Overseas Holdings Corporation (SpinCo).
Increased Revenues in Canadian Operations
Revenues from continuing operations increased approximately 3x for both the 3- and 6-month periods ended June 30, 2024, compared to the same periods in 2023, with Q2 2024 revenues at $2.5 million and a strong operating margin in the high 40% range.
Positive Cash Flow and Strong Financial Position
The Canadian business has positive working capital of approximately $5 million, including $4 million in cash, with only $3.4 million in mortgage debt.
Future Growth Optimism for PNG Operations
Despite current challenges, there is optimism for future drilling opportunities in PNG related to the Papua LNG project and other large-scale projects, which could significantly boost operations.
Lowlights
Decreased PNG Revenue and Activity
PNG revenue declined from $16.6 million in Q2 2023 to $10.4 million in Q2 2024, largely due to the cessation of drilling operations with Rig 103 and the associated decrease in rental revenue.
Challenges in Alaska Operations
The Alaskan operations faced challenges, including low activity due to extreme weather and client scheduling, leading to a net after-tax loss of $2.1 million for Team Snubbing International.
Delay in Papua LNG Project Investment Decision
The final investment decision for the Papua LNG project has been delayed to Q4 2025 or Q1 2026, impacting the timeline for potential operational growth in PNG.
Company Guidance
During the Q2 2024 earnings call for High Arctic Energy Services (HWO.TO), executives provided guidance on several key metrics and strategic initiatives. Michael Maguire, the CEO, confirmed the completion of a corporate reorganization, resulting in the creation of a new publicly listed entity, High Arctic Overseas Holdings Corporation (SpinCo), with both entities now trading separately on the TSX Venture Exchange and TSX Main Exchange, respectively. This reorganization resulted in 12,448,166 new common shares for both High Arctic and SpinCo. In terms of operations, Rig 103 completed its drilling program, and rental activities in Papua New Guinea (PNG) have softened. Financially, the Delta Rentals acquisition has tripled revenues from continuing operations to $2.5 million in Q2 2024 and $5.5 million for the first half of the year, with a strong operating margin consistently in the high 40% range. SpinCo commences with no long-term debt and approximately USD 19 million in working capital, indicating a robust financial position to facilitate future growth, potentially through M&A activities in the region.High Arctic Energy Services Corporate Events
Business Operations and StrategyFinancial Disclosures
High Arctic Energy Services Reports 2024 Year-End Results and Strategic Reset
Positive
Mar 31, 2025
High Arctic Energy Services Inc. announced its 2024 fourth quarter and year-end results, highlighting a strategic reset towards a Canadian-focused platform with minimal debt and a strong rental business. The successful integration of Delta Rental Services and a corporate restructuring, including the spin-off of its PNG business, have positioned the company for growth through selective investments and acquisitions in Canada. The company also emphasized its commitment to safety and operational excellence, achieving a zero Total Recordable Incident Frequency Rate for the second consecutive year.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.