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Good morning, ladies and gentlemen, and welcome to the Orbit Garant Drilling, Inc. Fiscal 2020 Second Quarter Results Conference Call and Webcast. [Operator Instructions] This call is being recorded on Thursday, February 13, 2020. I'd now like to turn the conference over to Éric Alexandre. Please go ahead.
Thank you, operator, and good morning, ladies and gentlemen. With me on the call today is Alain Laplante, CFO. Please be aware that certain information discussed today may be forward-looking and that actual results could differ materially. We will also be discussing certain non-IFRS measures. Please refer to our SEDAR filings for additional information on both our risk factors and non-IFRS measures. Following my opening remarks, Alain will review our financial results, and I will conclude with comments on our outlook and growth strategy. We will then welcome questions. Revenue for our fiscal second quarter ended December 31, 2019, totaled $38.3 million, an increase of 13.6% compared to Q2 a year ago. Our total meter drilled for the quarter was 366,000, a 17.5% increase from Q2 last year. Our growth in revenue in meter drilled in the quarter was driven by increased drilling activity in Canada. We have now recorded 3 consecutive quarters of revenue growth in Canada, a trend that is supported by the strengthening price of gold, which is currently at its highest level since 2013. This is providing gold mining companies of all sizes with improved access to capital to support the advancement of their exploration and mine development drilling programs. We are pleased by the strengthening customer demand in Canada, we expect increasing industry utilization rate in Canada to have a positive impact on contract pricing going forward. Our international drilling revenue was down slightly in the quarter due to a number of factors. Our fiscal second quarter is typically our weakest quarter, both in Canada and internationally due to project shutdown during the December holidays. In our international operation, drilling activity in West Africa also show -- slowed due to the rainy season. Because these seasonal factors, our international operations were also impacted by civil protests in Chile and regional security issue in Burkina Faso, which result in delays or interruption on certain customer projects. Further, we completed a large multiyear drilling project in Chile during Q4 last year. Internationally, we believe the political situation in Chile has now stabilized and its impact on mining project has diminished. We continue to monitor Burkina Faso, but we are now actively seeking drilling project in other jurisdiction in West Africa. While we have experienced some revenue decline in our international business since its peak in fiscal 2018, when we generate over $50 million in revenue for the year. We have worked hard in establishing a strong international platform and the business relationship that we believe will generate significant value over the long term. Our international operations provide greater market mineral and project diversification. Orbit Garant brings a unique value proposition to these markets with our expertise in both surface and underground drilling and our long-standing focus on innovation. Our international presence also provides us with the opportunity to strengthen relationships with larger mining companies that have projects in both Canada and internationally. We want to be their driller of choice. As we have stated previously, the Canadian market will remain our #1 market in terms of revenue generation. We are targeting a long-term revenue split of approximately 25% international and 75% from Canada. Now I'd like to turn the call over to Alain to review our financial results in more detail. Alain?
Thank you, Éric, and good morning, everyone. As Éric said earlier, our revenue was up 13.6% from Q2 a year ago. Our drill utilization rate was 59% in the quarter, up from 54% in Q2 a year ago. Our revenue in Canada increased 21.2% to $28.6 million, reflecting increased meters drilled. International revenue was $9.7 million, a decrease of $0.4 million compared to Q2 last year. Éric already discussed the factors that resulted in this decline. On a positive note, we were able to partially offset our decline in international revenue with new drilling projects in Guyana and Argentina. Average revenue per meter drilled in the quarter was $105, down from $108 in Q2 last year. This decrease was attributable to a lower proportion of high-priced -- higher-priced specialized drilling activity in the international drilling segment, primarily as a result of the completed contract in Chile noted earlier. Our adjusted gross margin, excluding depreciation expenses, was 12.5% in the quarter compared to 15.2% in Q2 last year. The decline was primarily attributable to the completion of a large drilling contract in Chile in Q4 last year and decreased drilling activity in Burkina Faso. G&A expenses were $4.2 million or 10.8% of revenue compared to $4.9 million or 14.4% of revenue in Q2 2019. Lower G&A expense was primarily attributable to higher acquisition and integration costs related to the acquisition of the drilling business of Projet Production International in Burkina Faso in Q2 a year ago. EBITDA increased to $1 million compared to $0.9 million in Q2 last year. Net loss was $2.4 million or $0.06 a share compared to a net loss of $1.7 million or $0.04 a share in Q2 last year. Turning to our balance sheet. We withdrew a net amount of $2.3 million during the second quarter on our credit facility compared to a withdrawal of $7.1 million in Q2 last year when we completed the PPI acquisition. As at December 31, 2019, we had $30.4 million drawn under the credit facility compared to $25.3 million as at June 30, 2019, which was our fiscal 2019 year-end. Our working capital position was $57.7 million at December 31, up from $55.1 million at June 30.I'll now turn the call back to Éric for closing comments. Éric?
Thanks, Alain. Customer demand from our -- for our services continues to strengthen in Canada, and we do not see indications that it will slow down anytime soon. Despite the recent softening in our international operation, we reported the second highest Q2 revenue in our history and our second highest revenue total for the 6 months of the fiscal year as well. Our positive outlook for demand in both Canada and our international markets is supported by the gold price, which has been in a rising bull market since the end of May 2019. Gold miners have a strong motivation to increase exploration and development spending and their ability to access capital is increasing as well. S&P Global Market Intelligence recently reported that junior and intermediate mining companies raised USD 4.3 billion for gold-related projects in 2019. This was the highest level in 5 years and a 30% increase compared to 2018. With nearly 70% of our revenue coming from gold project in the first half of fiscal 2020, we are well positioned to benefit from increasing demand in this sector. That concludes our formal remarks, and I now -- will now be pleased to answer any questions. Erther, please begin the question period.
[Operator Instructions] Your first question comes from Gordon Lawson with Paradigm Capital.
In terms of Burkina Faso, how much of the company's activities in the country have been put on hold? And is there an expected time line for operations to return to previous levels?
Well, there is no clear indication there. What we see is that last year, at the same period, we were operating around 80% capacity. Right now, we're running a little bit below 50% capacity. The people there -- the client there are on a, let's call it, a prudent approach. So we'll wait a little bit, but the projects are supposed to move forward. Exactly when, we do not know. I can say that, as an example, SEMAFO that has stopped their operation while they have this attack, they just resumed their operation lately in January, which is a good sign that it will recover very soon.
[Operator Instructions] There are no further questions at this time. Please proceed.
Okay. So if there is no further question, we'll terminate the call. Thank you very much for listening and see you soon.
Thank you. Have a nice day.
Ladies and gentlemen, this concludes your webcast for today. We thank you for participating and ask that you please disconnect your lines. Have a great day.