Company Announcements

EDMONTON, AB , March 6, 2026 /CNW/ - McCoy Global Inc. ("McCoy," "McCoy Global" or "the Corporation") (TSX: MCB) today announced its operational and financial results for the year and three months ended December 31, 2025.

Fourth Quarter Highlights:

• Revenue increased 1% to $25.6 million, compared to $25.2 million in Q4 2024, driven by strong demand for recently commercialized smartProducts.
• smartProduct revenue⁵ accounted for $14.1 million, or 55%, of total revenue, an increase of $2.0 million or 16% from Q4 2024.
• Net earnings of $6.1 million, a 44% increase from $4.3 million in 2024.
• Adjusted EBITDA¹ remained consistent with Q4 2024 at $6.5 million, or 25% of revenue (Q4 2024 $6.5 million, 26% of revenue).

Annual Highlights:

• Revenue increased 8% to $83.8 million, compared to $77.5 million in 2024, driven by strong demand for smartProducts.
• smartProduct revenue⁵ accounted for $43.6 million, or 52%, of total revenue, an increase of $13.9 million from 2024.
• Net earnings of $9.0 million, a 2% increase from $8.9 million in 2024.
• Adjusted EBITDA¹ of $16.8 million, or 20% of revenue, compared to $16.2 million, or 21% of revenue, in 2024.
• Advanced its Technology Roadmap, and since January 1, 2025:
  • 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 million of contract awards from our US field trial partners for system hardware. In addition to the equipment award, the contract included utilization-based software-as-a-service (SaaS) revenue enabled by our integrated software platform for remote control, automation, and data-driven operational intelligence. McCoy completed deliveries for these in Q4 and recognized its first SaaS‑like subscription revenues for this technology in 2025. Recent field deployments have validated the system's technical performance, and have met or exceeded all technical objectives, delivering targeted safety and efficiency outcomes. 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 goal to significantly reduce TRS labor costs.
  • McCoy continued to advance the commercialization of its smartCRT™ technology, delivering multiple hydraulic smartCRT™ units to the Middle East and 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 mechanical CRT technologies while 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 and 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 and completed commissioning in Q4 2025. Delivering and commissioning 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 offshore well profiles. The Latin America contract 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. In Q4 2025, McCoy received a $3.7 million purchase commitment for integrated hydraulic power tong systems intended for deep-water offshore operations in the Eastern Hemisphere, with a portion delivered in 2025 and the remainder scheduled for 2026.

"Throughout 2025, we continued to demonstrate meaningful progress against our Technology Roadmap, successfully commercializing multiple smartProduct offerings and delivering systems that are already generating strong technical results for our customers. The rapid growth of smartProduct revenue, combined with our first SaaS‑like contributions, underscores the compelling value our technologies bring to improving safety, efficiency, and operational consistency," said Jim Rakiviech, President and CEO. "Recent geopolitical developments in the Middle East have introduced an additional layer of near‑term uncertainty. With more than two‑thirds of our year‑end backlog destined for this region, ongoing shipping suspensions and restricted port access may delay certain deliveries and temporarily defer associated revenue and cash receipts. Importantly, underlying customer demand remains intact, but timing may create near‑term pressure on operating cash flow and working capital. While the timing of certain NOC-driven tenders and the pace of technology adoption across other markets remains difficult to forecast, the milestones we achieved in 2025 reinforce our confidence that our technology strategy is the right one. We remain committed to disciplined execution as we expand our smartProduct portfolio and work closely with customers to advance adoption across global markets."

"In response to emerging logistics disruptions stemming from the Middle East conflict and the limited visibility on NOC tender timing, in the first quarter of 2026 we have taken decisive action to optimize our cost structure and preserve margins and liquidity against downside scenarios, while ensuring continued investment in the strategic initiatives most critical to our long-term growth," said Lindsay McGill, Vice President & CFO. "Our disciplined approach resulted in approximately US$1.9 million of annualized cost reductions, driven by reductions in force, tighter discretionary spending controls, and the deferral of non‑essential capital expenditures. Additionally, we made the decision to preserve financial flexibility by pausing our quarterly dividend due to the recent conflict in the Middle East. At the same time, we protected our key technology development and customer support programs, enabling us to sustain momentum in smartProduct commercialization. This balanced approach ensures we remain agile, preserve liquidity, and maintain the financial flexibility required to support our customers and deliver on our strategic priorities."

Fourth Quarter Financial Highlights:

• Total revenue of $25.6 million, compared with $25.2 million in 2024.
• Net earnings of $6.1 million, compared to net earnings of $4.3 million in 2024.
• Adjusted EBITDA¹ of $6.5 million, or 25% of revenue, compared with $6.5 million, or 26% of revenue, in 2024.
• Booked backlog² of $25.8 million at December 31, 2025, a 10% increase from the $23.5 million in the fourth quarter of 2024.
• Book-to-bill ratio³ was 0.94 for the three months ended December 31, 2025, compared with 0.67 in the fourth quarter of 2024.

Annual Financial Highlights:

• Total revenue of $83.8 million, an 8% increase from the $77.5 million reported in 2024, driven by strong demand for recently commercialized smartProducts.
• Net earnings of $9.0 million, compared to net earnings of $8.9 million in 2024.
• Adjusted EBITDA¹ of $16.8 million, or 20% of revenue, compared with $16.2 million, or 21% of revenue, in 2024.

Financial Summary

Revenue for the three months ended December 31, 2025, increased by 1% compared to the same period in 2024. Notably, smartProduct sales, rental and service revenue increased 16% compared to the prior period. The improvement reflects a combination of accelerating smartProduct adoption and the timing of order intake and deliveries in the quarter. Key contributors included the delivery of smarTR™ systems to a leading US TRS company and an integrated hydraulic power tong system supporting deep‑water offshore operations in the Eastern Hemisphere. For the three months ended December 31, 2025, smartProduct revenue of $14.1 million accounted for 55% of revenue (three months ended December 31, 2024 – 48%), an increase of $2.0 million from the comparative period. For the year ended December 31, 2025, revenues increased by 8% from the comparative period, driven by smartProduct sales, rental and service revenue.

Gross profit, as a percentage of revenue for the three months and year ended December 31, 2025, was 37% and 34% respectively, a decrease of four and two percentage points, respectively, from the comparable periods in 2024. The year‑over‑year decline primarily reflects production facility expansions, higher production overheads, and increased staffing levels to support planned throughput growth, as well as expansion of service and commissioning personnel and related facilities to support customer success with newly commercialized technologies. These factors reduced gross margin in the near term but are expected to contribute to enhance operational leverage as smartProduct technology adoption continues to expand.

For the three months ended December 31, 2025, the Corporation reported $0.1 million in general and administrative expenses (G&A) that was largely a result of a $1.6 million reversal of stock‑based compensation expense, driven by volatility in the Corporation's share price and its effects cash-settled share-based compensation, reversal of prior allowances for doubtful accounts of $0.6 million recognized during the quarter, as well as lower employee short-term incentives. For the year ended December 31, 2025, McCoy reported G&A of $9.2 million or 11% of revenue, a decrease of $0.8 million from 2024. The reduction was driven primarily by lower stock‑based compensation expense reflecting volatility in the Corporation's share price and its impact on cash‑settled share‑based awards as well as reduced employee short‑term incentive costs. These decreases were partially offset by the Corporation's investment in an AI platform to enhance operational decision‑making, along with increased human resources and corporate support costs aligned with the organization's growth. For the year ended December 31, 2025, as a percentage of revenue, G&A decreased by two percentage points to 11% compared to 2024.

During the three months and year ended December 31, 2025, product development and support expenditures totaled $2.0 million and $7.8 million, respectively, with the design and development of additional smart product enhancements and complementary product accessories for the smartTR^™ system, and included internal engineering hours, prototype builds, and field trial activities supporting the commercialization and customer validation of next‑generation technologies. For the three months and year ended December 31, 2024, product development and support expenditures totaled $2.1 million and $6.2 million, respectively, and the Corporation's support efforts were primarily focused on developing, testing, and commercializing enhancements and complementary accessories for the smartCRT™ platform to meet emerging contractual and operating requirements in key geographic markets.

For the three months and year ended December 31, 2025, sales and marketing expenses increased from the comparative period to $1.1 million and $3.2 million, respectively, driven by enhanced customer engagement activities, travel associated with global smartProduct deployments, and expanded marketing initiatives. As a percentage of revenue, Sales & Marketing remained consistent with the comparative periods at 4%.

Net earnings for the three months ended December 31, 2025, was $6.1 million or $0.23 per basic share, compared with net earnings of $4.3 million or $0.16 per basic share in the fourth quarter of 2024. Net earnings for the year ended December 31, 2025, was $9.0 million or $0.34 per basic share, compared with net earnings of $8.9 million or $0.33 per basic share in 2024.

Adjusted EBITDA¹ for the three months ended December 31, 2025, was $6.5 million compared with $6.5 million for the fourth quarter of 2024. For the year ended December 31, 2025, Adjusted EBITDA¹ was $16.8 million compared with $16.2 million in 2024. EBITDA performance reflects both strong smartProduct contribution which was offset by costs associated with expansion of service and commissioning personnel and facilities to support customer success with newly commercialized technologies, as well as increased production staffing levels and facility expansions to accommodate higher throughput.

As at December 31, 2025, the Corporation had $3.0 million in net cash⁴, along with an additional $5.4 million available under undrawn credit facilities.

Selected Quarterly Information

Selected Annual Information

Summary of Quarterly Results

Outlook and Forward-Looking Information

Subsequent to December 31, 2025, the abrupt escalation of conflict in the Middle East, coupled with effective suspension of shipping through the Strait of Hormuz, is expected to result in delayed shipments, and may result in reduced bookings as customers remain preoccupied with safety considerations and operational contingencies. Greater than two‑thirds of the Corporation's December 31, 2025 backlog is destined for the Middle East. Ongoing shipping suspensions and restricted port access may delay delivery schedules and defer associated revenue recognition and cash receipts. While the underlying customer demand remains intact, these timing impacts may place pressure on operating cash flow and working capital. In response, the Corporation has paused its quarterly dividend and instituted several cost containment measures to maintain financial flexibility and manage lack of near-term visibility.

Against this backdrop of uncertainty from emerging Middle East conflict, the strategic landscape across our international markets continues to present meaningful long‑term opportunity. Across select international geographies, multiyear NOC development programs, active TRS tender frameworks with limited qualified suppliers, and ongoing safety and automation mandates are creating a durable pipeline of opportunities for our smartProduct offerings. Over the next 12 months, several TRS contract awards are anticipated that, in aggregate, represent a potential opportunity involving more than 100 rigs being allocated to TRS customers. Our smartCRT™ is one of two nonproprietary tools that presently meets the technical qualification requirements under one of the larger tenders, positioning McCoy favorably should awards proceed as planned. However, timing remains at the discretion of the relevant NOCs and may be further impacted by recent regional conflict. Management expects that TRS rig allocations that had been originally expected to commence in Q1 of 2026, may be deferred, which introduces further near-term risk to anticipated H1 2026 order intake and less visibility with respect to H2 2026. Timing of these long-term tender announcements has historically been unpredictable, however it is incumbent upon technology providers to be prepared to respond when they occur. Looking beyond 2026, we anticipate a further NOC TRS tender cycle in 2027 across a separate geography, representing a further potential cumulative opportunity in excess of 200 rigs. In 2026, our focus remains on methodical market development with key customers in this region to ensure our smartProduct offerings are technical qualified, including the objective of having smarTR™ eligible under relevant tenders and supporting higher day rate potential when our technology replaces conventional tools.

In the North American land market, drilling activity continued to trend downward throughout 2025, with rig counts reaching some of the lowest points observed since early 2021. US land activity is anticipated to remain rangebound throughout 2026. Despite these headwinds, revenue from this region has been supported by McCoy's smartProduct technologies, particularly the smarTR™ system. At the same time, the industry's investor driven focus on near-term returns means technology adoption decisions are increasingly conditioned on clear, measurable efficiency gains and payback visibility.

We continue to take a targeted and deliberate approach to commercialization of our smarTR^™ system, 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. Importantly, pace of adoption is further driven by customer economics: the smarTR™ system replaces fully depreciated, labor-intensive conventional equipment, and the return profile is therefore closely tied to realized labor savings and operating efficiencies at the wellsite.

During the fourth quarter of 2025, McCoy completed deliveries for all systems under the $11.0 million of contract awards from U.S. field‑trial partners in Q4 2025 and recognized its first SaaS‑like subscription revenues for this technology in 2025. Recent field deployments have validated the system's technical performance, and have met or exceeded all technical objectives, delivering targeted safety and efficiency outcomes. The Corporation expects its customer partner to use the first half of 2026 to scale deployed systems and refine system allocation across jobs and customer contracts to enhance system utilization and returns. To optimize customer economics and accelerate adoption, McCoy has planned 2026 product and software development initiatives to fully integrate additional key smarTR™ accessories as well as to complete enhanced software development initiatives. The Corporation plans to deliver on these enhancements in 2026; which is expected to enable greater labour savings, improved operational efficiency, and simplified training. This will support broader fleet‑wide deployment with realization of the system's full potential.

Although the current market environment may temper the pace of adoption and near-term revenue growth across global geographies, McCoy remains confident in its Technology Roadmap initiative. Though we are faced with capital providers increasingly expecting operators to deliver returns today, prioritizing near‑term efficiencies and cost reductions over longer‑horizon technology investment cycles, leading E&Ps and NOCs have reinforced their commitment to safety through "clear the floor" initiatives. This creates a meaningful opportunity for innovative solutions like McCoy's smarTR^™ that align with these evolving standards. 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 a result of recent developments in the Middle East, we expect customer shipments scheduled for delivery over the next two months to be delayed, with associated revenue recognition deferred and cash collection on affected shipments slowing, creating a near‑term liquidity impact. Visibility remains limited given the fluid nature of the conflict and evolving shipping and insurance restrictions. At a minimum, we also anticipate delays to orders previously expected from this region in March and April, as customers prioritize safety and operational continuity. We continue to closely monitor conditions, reassess our posture as circumstances evolve, and adjust our operating plans as logistics corridors stabilize and reopen. Quarterly performance is expected to continue to reflect variability typical of capital equipment markets, where purchasing decisions and shipment schedules often shift between periods.

To navigate this environment, we have proactively managed costs, deferred select capital expenditures, while continuing to invest in critical strategic initiatives such as product development, deployment, customer support activities, and scaling our global technical support capabilities with particular focus on McCoy's smartProduct lines. We have adopted a conservative and prudent operating posture to preserve liquidity and protect margins against downside scenarios. Consistent with our conservative operating posture, subsequent to December 31, 2025 we executed decisive cost actions resulting in approximately US$1.9 million of annualized reductions, primarily through reductions in force and lower discretionary spending, while also deferring non‑critical capital expenditures. In line with these measures, we have also deferred payment of the Corporation's quarterly dividend until visibility improves. The Corporation will continue to monitor market developments closely and prioritize incremental investment toward initiatives with demonstrable payback and strategic relevance.

Capital expenditures for 2026 are expected to be lower than in 2025, which included several growth related initiatives. Anticipated 2026 capital spending includes:

• up to US$1.8 million of investment in the development of 'Technology Roadmap' offerings, with external cash outflows largely deferred to the second half of 2026;
• up to US$1.1 million of strategic investment in rental equipment, primarily utilizing existing inventory; and
• up to US$0.3 million of investments in production facility equipment, also largely deferred to the second half of 2026.

2026 and beyond, we continue to focus on our key strategic initiatives to deliver value to all our stakeholders:

• Accelerating market adoption of new and recently developed 'smart' portfolio products; and
• Focusing on capital allocation priorities.

About McCoy Global Inc.

McCoy Global is transforming well construction using automation and machine learning to maximize wellbore integrity and collect precise connection data critical to the global energy industry. The Corporation has offices in Canada, the United States of America, and the United Arab Emirates and operates internationally in more than 50 countries through a combination of direct sales and key distributors.

Throughout McCoy's 100-year history, it has proudly called Edmonton, Alberta, Canada its corporate headquarters. The Corporation's shares are listed on the Toronto Stock Exchange and trade under the symbol "MCB".

¹ EBITDA is calculated under IFRS and is reported as an additional subtotal in the Corporation's consolidated statements of cash flows. EBITDA is defined as net earnings, before depreciation of property, plant, and equipment; amortization of intangible assets; income tax expense (recovery); and finance charges, net. Adjusted EBITDA is a non-GAAP measure defined as net earnings, before: depreciation of property, plant, and equipment; amortization of intangible assets; income tax expense (recovery); finance charges, net; provisions for excess and obsolete inventory; other (gains) losses, net; restructuring charges; share-based compensation; and impairment losses. The Corporation reports on EBITDA and adjusted EBITDA because they are key measures used by management to evaluate performance. The Corporation believes adjusted EBITDA assists investors in assessing McCoy Global's current operating performance on a consistent basis without regard to non-cash, unusual (i.e. infrequent and not considered part of ongoing operations), or non-recurring items that can vary significantly depending on accounting methods or non-operating factors. Adjusted EBITDA is not considered an alternative to net earnings (loss) in measuring McCoy Global's performance. Adjusted EBITDA does not have a standardized meaning and is therefore not likely to be comparable to similar measures used by other issuers.  For comparative purposes, in previous financial disclosures 'adjusted EBITDA' was defined as "net earnings before finance charges, net, income tax expense (recovery), depreciation, amortization, impairment losses, restructuring charges, non-cash changes in fair value related to derivative financial instruments and share-based compensation."

² McCoy Global defines backlog as orders that have a high certainty of being delivered, but have not yet been recognized as revenue, and is measured on the basis of a firm customer commitment, such as the receipt of a purchase order or customer confirmation of McCoy sales order. Backlog is a supplementary financial measure, and, as a result, the definition and determination of backlog will vary among other issuers reporting a backlog figure.  Backlog reflects likely future revenues; however, cancellations or reductions may occur and there can be no assurance that backlog amounts will ultimately be realized as revenue, or that the Corporation will earn a profit on backlog once fulfilled. Expected delivery dates for orders recorded in backlog historically spanned from one to six months. Under current market conditions, many customers have shifted their purchasing towards just-in-time buying.

³ The book-to-bill ratio is a measure of the amount of net sales orders received to revenues recognized and billed in a set period of time. The ratio is an indicator of customer demand and sales order processing times. The book-to-bill ratio is a supplementary financial measure, and, as a result, the definition and determination of the ratio will vary among other issuers reporting the book-to-bill ratio. McCoy Global calculates the book-to-bill ratio as net sales orders taken in the reporting period divided by the revenues reported for the same reporting period.

⁴ Net cash is a non-GAAP measure defined as cash and cash equivalents, plus: restricted cash, less: borrowings.

⁵ smartProduct revenue is a non-GAAP measure and includes sales, rental and services revenues from those products and technologies developed under the Corporation's technology roadmap initiative. The metric includes revenues from flush mount spiders (FMS), casing running tools (CRTs), smartTONGs and related software and accessories. The Corporation believes smartProduct revenue is a key metric that can assist investors in assessing how McCoy Global has executed on its technology roadmap strategy.

Forward-Looking Information

This News Release contains forward looking statements and forward-looking information (collectively referred to herein as "forward looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward looking information is often, but not always, identified by the use of words such as "could", "should", "can", "anticipate", "expect", "objective", "ongoing", "believe", "will", "may", "projected", "plan", "sustain", "continues", "strategy", "potential", "projects", "grow", "take advantage", "estimate", "well positioned" or similar words suggesting future outcomes. This New Release contains forward looking statements respecting the business opportunities for the Corporation that are based on the views of management of the Corporation and current and anticipated market conditions; and the perceived benefits of the growth strategy and operating strategy of the Corporation are based upon the financial and operating attributes of the Corporation as at the date hereof, as well as the anticipated operating and financial results. Forward looking statements regarding the Corporation are based on certain key expectations and assumptions of the Corporation concerning anticipated financial performance, business prospects, strategies, the sufficiency of budgeted capital expenditures in carrying out planned activities, the availability and cost of labour and services and the ability to obtain financing on acceptable terms, which are subject to change based on market conditions and potential timing delays. Although management of the Corporation consider these assumptions to be reasonable based on information currently available to them, they may prove to be incorrect. By their very nature, forward-looking statements involve inherent risks and uncertainties (both general and specific) and risks that forward-looking statements will not be achieved. Undue reliance should not be placed on forward looking statements, as a number of important factors could cause the actual results to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates and intentions expressed in the forward looking statements, including inability to meet current and future obligations; inability to complete or effectively integrate strategic acquisitions; inability to implement the Corporation's business strategy effectively; access to capital markets; fluctuations in oil and gas prices; fluctuations in capital expenditures of the Corporation's target market; competition for, among other things, labour, capital, materials and customers; interest and currency exchange rates; technological developments; global political and economic conditions; global natural disasters or disease; and inability to attract and retain key personnel. Readers are cautioned that the foregoing list is not exhaustive. The reader is further cautioned that the preparation of financial statements in accordance with IFRS requires management to make certain judgments and estimates that affect the reported amounts of assets, liabilities, revenues, and expenses. These judgments and estimates may change, having either a negative or positive effect on net earnings as further information becomes available, and as the economic environment changes. The information contained in this News Release identifies additional factors that could affect the operating results and performance of the Corporation. We urge you to carefully consider those factors. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this News Release are made as of the date of this New Release and the Corporation does not undertake and is not obligated to publicly update such forward looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.       

Website: www.mccoyglobal.com     

SOURCE McCoy Global