Action Energy Company (AEC), Kuwait’s leading local partner for integrated upstream services, reported a 62.9% year-on-year increase in net profit to KWD6.5 million ($21 million) for the first nine months of 2026, supported by stronger core operations, higher drilling revenue and the expansion of its oilfield services business.

Revenue for the nine-month period ended 30 September 2026 increased 18.5% to KWD26.9 million, compared with KWD22.7 million in the corresponding period last year. EBITDA rose 13.1% to KWD13.4 million, while earnings per share reached 11.49 fils, up from 10.62 fils.

For the third quarter, net profit increased 20.3% year on year to KWD2.1 million, despite revenue declining 4.5% to KWD8.8 million. EBITDA decreased 9.1% to KWD4.4 million, compared with KWD4.8 million in Q3 2025.

The quarterly EBITDA decline was primarily attributed to revised rig lease rates under a new contract with Kuwait Oil Company (KOC), higher general and administrative expenses associated with business expansion, lower rig-move activity and the absence of a one-off revenue contribution recorded in the comparative period.

However, the revised KOC contract secures the deployment of contracted rigs for another five to six years, supporting the company's fleet utilisation rate of 100%.

Sheikh Mubarak Abdullah Al-Mubarak Al-Sabah, Chairman of Action Energy Company, said: “AEC delivered strong results for the first nine months of 2026, with record net profit of KWD 6.5 million and operating cash flow up 73.8% year-over-year. This performance reflects the strength of our business and puts us in a solid position to execute our long-term growth strategy. We continue to invest in our people, equipment, and capabilities to support Kuwait’s upstream oil and gas sector. Our focus remains on delivering long-term value for our shareholders, and strengthening AEC’s position as a trusted partner to Kuwait’s energy industry.”

Ahmad Mohammad Al-Ajlan, Board Member and Chief Executive Officer, said: “AEC delivered strong profitability through the first nine months of 2026, with third-quarter net profit rising 20.3% year-over-year to KWD 2.1 million. We continued to invest in expanding our operating capabilities, making steady progress on the mobilization of seven new rigs and the expansion of our oilfield service lines, supported by a contracted backlog of KWD 340.7 million. These investments will increase our operating capacity, broaden our service offering, and position us for the next phase of growth. We remain focused on safe, reliable execution, financial discipline, and delivering sustainable growth and long-term returns for our shareholders.”

Drilling operations and fleet expansion

Drilling and workover services remain the company's largest business segment, accounting for approximately 60% of its total contracted backlog. Action Energy operated 20 rigs during the reporting period.

Revenue from core drilling activities increased 4.2% year on year to KWD7.2 million. However, income from rig leasing, mobilisation and ancillary services declined, reflecting revised rental rates under the new KOC contract, fewer rig movements and the absence of the previous year's one-off revenue contribution.

The company is also progressing with the mobilisation of seven additional rigs to expand its operating capacity. The new fleet comprises four 1,500-horsepower rigs, one 1,000-horsepower rig and two 750-horsepower rigs.

Operations are expected to commence in the first quarter of 2027, supporting the company's strategy to strengthen its position in Kuwait's upstream drilling market.

Oilfield services expand contribution

AEC is also accelerating its diversification into higher-value oilfield services, reducing its reliance on traditional drilling activities and expanding its presence across the upstream value chain.

The contribution of oilfield services to the company's backlog increased from 28% in the first quarter to 40% in the third quarter of 2026, representing a 12-percentage-point increase.

During the nine-month period, the company continued mobilising equipment and developing its electric submersible pump (ESP), Slickline and once-through steam generator (OTSG) service lines, in line with its expansion schedule.

The growing contribution from these services reflects AEC's efforts to broaden its revenue streams and strengthen its integrated service offering to oil and gas customers.

Growth strategy and outlook

Action Energy's contracted backlog stood at KWD340.7 million, providing visibility over future activity and supporting its expansion plans.

For the fourth quarter of 2026 and first quarter of 2027, the company's priorities include executing its existing backlog, completing the mobilisation of seven new rigs and receiving additional oilfield services equipment.

AEC also plans to maintain safe and reliable operations across its existing 20-rig fleet while managing liquidity, leverage and remaining capital expenditure. The company aims to keep its net debt-to-equity ratio at or below 1.25 times.

Other priorities include converting its contracted backlog into profitable revenue and selectively pursuing opportunities in the digital sector.

The company said it would continue monitoring regional developments while focusing on operational efficiency, financial discipline and sustainable growth.

The expansion of its rig fleet and oilfield services portfolio is expected to strengthen Action Energy's operating capacity and support its long-term position in Kuwait's upstream oil and gas sector. -OGN/TradeArabia News Service