Action Energy Q3 Profit Rises 20.3% as Revenue Falls 4.5%

Action Energy Company reported its third-quarter results on November 10, 2026, with reviewed financial statements showing net profit for the period ended September 30, 2026, up 20.3% year over year to 2.12 million Kuwaiti dinars (KWD), even as revenue fell 4.5% to KWD 8.84 million.

EBITDA declined 9.1%. The company’s results announcement attributed the pressure to revised rig lease rates under a new Kuwait Oil Company contract and higher general and administrative expenses tied to expansion, while fewer rig moves and the absence of a one-time revenue contribution recorded in the third quarter of 2025 also reduced revenue.

The new terms secure deployment of the affected rigs for five to six years and sustain 100% fleet utilization, according to the company. That pairs lower current lease rates with longer deployment visibility.

Core drilling-services revenue increased 4.2% to KWD 7.2 million, while revenue from rig leasing, mobilization and ancillary services declined. The pressure was therefore concentrated outside the core drilling line rather than across every service category.

The profit comparison was helped by finance costs falling to KWD 0.90 million from KWD 1.12 million and by the absence of a KWD 0.59 million convertible-preference-share charge recorded a year earlier. Net investment income nearly offset the non-recurring contribution to the Kuwait Emergency Response Fund.

Expansion Spending Outpaces Operating Cash Flow

Net cash from operating activities reached KWD 9.88 million in the first nine months of 2026, while additions to property, plant and equipment totaled KWD 28.22 million. Capital work in progress mainly comprised drilling rigs and related equipment under construction.

Outstanding capital commitments were KWD 20.12 million at September 30 for drilling rigs, electric submersible pumps, slickline and related equipment. Cash and short-term deposits declined during the nine months, while term-loan and Islamic-financing balances increased. The commitments are to be financed through existing cash and available term-loan and Islamic-financing facilities, linking the expansion program directly to liquidity and borrowing capacity.

New Rigs Set the Next Execution Test

Action Energy reported a contracted backlog of KWD 340.7 million and 20 rigs in operation during the period. Drilling and workover services remained the majority of that backlog, while oilfield services increased its share during 2026 as the company broadened its offering.

The company said mobilization is progressing for seven new rigs and its electric-submersible-pump, slickline and once-through-steam-generator service lines, with rig operations expected to begin in the first quarter of 2027.

For the fourth quarter of 2026 and the following quarter, management aims to complete the rig mobilization, receive new oilfield-services equipment, execute the backlog and keep net debt to equity at or below 1.25 times.

The quarter separates earnings resilience from the cost of growth: lower financing charges supported profit while revised rig rates weighed on revenue and EBITDA, and expansion spending is running well ahead of operating cash generation. The next test is whether the new rigs and wider oilfield-services portfolio convert the backlog into sufficient cash to fund the remaining commitments within management’s leverage limit.