Mr. Denis Larocque reports

MAJOR DRILLING ANNOUNCES FOURTH QUARTER AND FISCAL YEAR 2023 RESULTS, ANNUAL NET EARNINGS UP 40%

Major Drilling Group International Inc. has released results for the fourth quarter and fiscal year 2023 ended April 30, 2023.

Fiscal 2023 highlights:

• Revenue of $735.7-million, an increase of 13.1 per cent over the prior year;
• EBITDA (earnings before interest, taxes, depreciation and amortization) of $144.2-million (or $1.74 per share), up from $114.1-million last year;
• Net earnings of $74.9-million (or 90 cents per share), up 40 per cent from last year;
• Net cash grew by $60.9-million during the year to $59.3-million;
• Achieved new milestone of 9.4 million lost-time-injury (LTI) free hours and an LTI rate of 0.05, a new record in the company's history.

Fourth quarter 2023 highlights:

• Revenue of $185.0-million, a decrease of 2.6 per cent over the same period last year;
• EBITDA of $37.2-million (or 45 cents per share), down from $40.7-million over the same period last year;
• Net earnings of $20.8-million (or 25 cents per share), down 7 per cent over the same period last year;
• Robust activity levels returned after a slower start to the quarter.

"In fiscal year 2023, Major Drilling generated the second-highest annual revenue in the company's history at a time where mineral exploration expenditures are still only at 60 per cent of the amount spent at the peak in 2012. Our strong EBITDA allowed us to grow our net cash position by over $60-million this year, positioning us well as this cycle plays out and for future years," said Denis Larocque, president and chief executive officer of Major Drilling. "Despite some challenging weather conditions in Nevada and Northern Canada in February, which slowed down the restart of operations after our seasonally slow third quarter, we were pleased to see robust activity levels return by the end of the quarter."

"A solid financial performance allowed the company to generate $37.2-million in EBITDA for the quarter, and despite an anticipated ramp-up in working capital, typical for the fourth quarter, our financial position remained strong, ending the quarter with $59.3-million of net cash," said Ian Ross, chief financial officer of Major Drilling. "With $180-million in available liquidity, we are well positioned to continue the execution of our growth strategy and remain committed to investing in the business. This quarter, we spent $16.6-million on capital expenditures, including the purchase of five new drill rigs and support equipment as we continue to reinvest in the business for long-term success. We also disposed of seven older, less efficient rigs, bringing the total rig count to 600. Our annual spend of $58.7-million demonstrates our ongoing commitment to providing our customers and employees with modern, innovative and safe equipment, as we continue to cement our position as the industry leader in specialized drilling. Further, I'm pleased to note that during the quarter, we announced a normal course issuer bid to provide additional flexibility to maximize shareholder value as we continue through this industry upcycle."

"Looking ahead to fiscal 2024, the outlook for Major Drilling remains extremely positive as most industry experts believe the anticipated copper supply deficit will further drive the urgent need to replenish reserves. We see an increasing number of global governments begin to address the energy transition every year, turning to renewable energy sources and upgrading their electric grids. This will require an enormous volume of copper, and likely uranium, increasing pressure on the existing supply/demand dynamic. The growing global demand for electric vehicles will only increase the need for metals like copper, nickel and lithium. We expect all of this to lead to substantial additional investments in copper and other base metal exploration projects as we help our customers discover the metals that will allow the world to accelerate its efforts toward decarbonization," said Mr. Larocque.

"Gold continues to lead exploration efforts globally with the average gold mine life decreasing due to the lack of exploration over the last several years. With this growing supply shortfall, several of our senior gold customers have committed to prioritizing value-adding grassroots exploration and development. Many of the new mineral deposits are located in areas challenging to access, requiring complex drilling solutions and increasing demand for Major Drilling's specialized services. Our position as the leader in specialized drilling continues to be a factor in attracting business from senior companies, at a time where juniors are facing difficulty financing projects.

"Despite the urgent need to replenish mineral reserves, both for gold and base metals, the industry is still early in the exploration cycle. According to S&P Global Market Intelligence, global non-ferrous exploration budgets increased to $13-billion in 2022, which is still a long way from the $21.5-billion spent in 2012 at the peak of the cycle. The mining industry is still in the discovery phase and will have to go through an intense multiyear infill drilling period to develop new mines in order to fill the projected supply gap in the different commodities.

"As part of our ongoing efforts to prepare for future increases in activity and what is lining up to be a busy calendar 2024, the company expects to spend approximately $80-million in capital expenditures in fiscal 2024. We will, however, remain vigilant and flexible in order to react and adjust to unforeseen market conditions. There is a need to increase the number of specialized and underground drills in some of our busiest markets, to continue to meet and exceed the rigorous standards of our customers. We continue to make investments in innovation directed towards increased productivity, safety and meeting customers' demands. We keep growing our fleet of computerized rigs and rod handling capacity, as well as retrofitting some of our rigs with computerized consoles and hands-free rod handlers. This falls in line with the enhancement of our recruiting and training systems as we bring in a new generation of employees, while strengthening our customer service. Finally, we will continue to invest in energy-efficient solutions on and around our drills, with systems such as energy-efficient drill heating systems and solar-powered lighting towers. Through our [environmental, social and governance] efforts, we will also add more water recirculation units, which can reduce water consumption by up to 90 per cent in some cases," concluded Mr. Larocque.

About Major Drilling Group International Inc.

Major Drilling is one of the world's largest drilling service companies primarily serving the mining industry. Established in 1980, Major Drilling has over 1,000 years of combined experience and expertise within its management team alone. The company maintains field operations and offices in Canada, the United States, Mexico, South America, Asia, Africa and Australia. Major Drilling provides a complete suite of drilling services including surface and underground coring, directional, reverse circulation, sonic, geotechnical, environmental, water-well, coal-bed methane, shallow gas, underground percussive/long-hole drilling, surface drill and blast, and a variety of mine services.

Webcast/conference call information

Major Drilling will provide a simultaneous webcast and conference call to discuss its quarterly results on Wednesday, June 14, 2023, at 8 a.m. EDT. To listen to the webcast, which includes a slide presentation, please go to the investors/webcasts section of Major Drilling's website and click on the link. Please note that this is listen-only mode.

To participate in the conference call, please dial 416-340-2217, participant passcode 7282992 followed by the number sign, and ask for Major Drilling's fourth quarter results conference call. To ensure your participation, please call in approximately five minutes prior to the scheduled start of the call.

For those unable to participate, a taped rebroadcast will be available approximately one hour after the completion of the call until Saturday, July 15, 2023. To listen to the rebroadcast, dial 905-694-9451 and enter the passcode 9670769 followed by the number sign. The webcast will also be archived for one year and will be available on the Major Drilling website.

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