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DDH1 drills down on ASX

stablished 15 years ago, drilling ser- have always followed. We will be straight in lithium, nickel or iron ore, but this
Evices provider DDH1 Ltd has devel- back into growth; organically and through [commodity cycle] is generally across
oped into a formidable outfit and further acquisition.” the board. There has probably been an
growth remains on the horizon. Pollock said growing through acquisi- under investment in drilling equipment in
Founded by Murray Pollock, Matt tion would be more expensive than 2-3 Australia over quite a few years as well,
Thurston, Richard Bennett and Matt years ago, however, that would not stop so the combination of those two things is
Izzett, DDH1 completed one of the larg- DDH1 from assessing potential add-ons really putting a squeeze on the availabil-
est West Australian IPOs of the past 10 that make sense for the company. ity of equipment.”
years after raising $150 million at $1.10c/ “We feel there is still opportunity Tightness in equipment and labour
share ahead of listing. and we think we could really add value usually correlates with an uptick in pric-
The listing on March 9 was four years through different streams of drilling – per- ing, and while costs have increased, Pol-
in the making for DDH1 and with min- haps underground or dewater streams – lock believes companies are still getting
ing and exploration companies currently which will allow us to provide a whole of good bang for their buck.
thriving, there have been few better times mine service to the sector.” “The lift in rates has been fairly mod-
in recent history to float on the ASX. Such is the level of activity in Austral- erate in relation to volumes. I think min-
“We’re very, very proud, I think it is an ia’s resources sector, drill rigs are scarce ing companies and explorers are getting
amazing achievement. When you look and DDH1 is flat-out honouring relation- good value at present. There is a short-
at DDH1, with 96 drill rigs, compared to ships with its clients, which have been age of rigs and I would see upward pres-
all other drilling companies around the built on “quality drilling services and a sure on pricing,” he said.
world our forecast EBITDA for FY2021 deep understanding of their business “However, it is times like this when in-
is Iarger than any other drilling company needs”. dustry regenerates itself, invests in new
in the world. We’re pretty proud that we “Demand for our services is the strong- equipment, attracts people back into in-
have achieved that with 96 rigs,” former est I can ever recall. We have the larg- dustry and contractors need higher pric-
DDH1 managing director, now a non-ex- est surface fleet in Australia and we still ing during these periods of time to fund
ecutive, Murray Pollock told Paydirt. cannot keep up with demand even with a that whole of cycle cost of running a drill-
“We have fantastic history of growth, fleet of that size,” Pollock said. ing and contracting company.”
both organic and by acquisition, and we “When there have been other periods
will carry on that same pathway that we of heightened activity it has often been – Mark Andrews

DDH1 founders Matt Thurston, Matt Izzett, Murray Pollock and Richard Bennett at
the ASX’s Perth offices in March. DDH1 is comprised of three brands – DDH1 Drilling,
Strike Drilling and Ranger Drilling – which employ 930 people
aUSTRaLIa’S PaYDIRT aPRIL 2021 Page 7