Capital Holds Guidance After Record Q1 as Mining, Lab Demand Accelerates

Key Points

• Capital reported a record first quarter with revenue of $101.7 million, up 42% year over year, driven by gains in drilling, mining services and MSALABS. Drilling utilization stayed in the low-to-mid 70% range, which management sees as near optimal.
• The company said demand is accelerating across its business lines: Capital Mining’s Sukari contract in Egypt started early and is ramping up, while MSALABS is adding new laboratories in Canada and Ivory Coast amid broad-based customer demand.
• Management maintained full-year guidance of $410 million to $440 million in revenue and said it remains at the front end of a demand cycle, supported by strong commodity prices and a growing pipeline of contracts.

Capital LON: CAPD Limited told shareholders at its annual general meeting that trading remained strong after a record first quarter, with Executive Chairman Jamie Boyton pointing to rising demand across drilling, mining services and laboratory operations.

Boyton described Capital as an integrated services provider to exploration and mining companies across Africa, the Middle East and North America. He said the group operates three main businesses: Capital Drilling, Capital Mining and MSALABS, with a broad revenue split of about 60%, 20% and 20%, respectively.

Capital Drilling operates a fleet in the “mid-130s” of rigs, which Boyton said is the largest drilling rig fleet in Africa and the Middle East, with some operations in Nevada. Capital Mining provides load-and-haul services and currently has two contracts in its portfolio. MSALABS operates about 36 laboratories across Africa, the Middle East and the Americas, with a “substantive footprint” in the U.S. and Canada.

Record First Quarter Revenue

Boyton said Capital reported first quarter revenue of $101.7 million, which he described as a record quarter for the company. He said revenue was up 42% from the first quarter of 2025.

Within the quarter, Boyton said the drilling business posted a 9% revenue increase, while the mining business nearly doubled revenue compared with the fourth quarter of last year as contracts ramped up and assets were redeployed. MSALABS revenue rose 55% from the first quarter of last year.

“An all-round very strong trading result,” Boyton said.

In drilling, Boyton said the business is “certainly trading well,” with utilization in the low-to-mid 70% range, which he said Capital views as near optimal. He also said the company is seeing an improvement in revenue per operating rig, a measure of monthly revenue output from its rigs.

Mining and Laboratory Contracts Advance

Boyton said Capital Mining’s second waste stripping contract at the Sukari Gold Mine in Egypt has started ahead of schedule, is operating to plan and is expected to receive further equipment in the coming quarter. He also said the RPO mining contract has continued through its ramp-up phases and is operating to plan.

MSALABS is seeing a broad increase in demand, according to Boyton. He said the company recently commissioned a new laboratory in Newfoundland, Canada, supported by a long-term contract with Equinox at the Valentine Mine. Two additional lab builds are close to commissioning: a client-based lab for Montage in Ivory Coast and a commercial lab in northern Ivory Coast. Both are expected to be commissioned in the third quarter.

Boyton also discussed Capital’s other business arms, including Capital Investments, which he described as a venture capital investment fund targeting early-stage explorers and developers with a portfolio of about $110 million. He also highlighted Capital Innovation, a working group focused on identifying and commercializing technologies, citing PhotonAssay in the laboratory business and more recent investments in Eco Detection and Portable PPB.

Middle East Tensions Have Not Disrupted Operations

Addressing recent geopolitical tensions in the Middle East, Boyton said Capital has had no disruption to on-site activities. He said the company has not received indications that customers are experiencing fuel supply issues.

Boyton added that fuel prices are “almost exclusively” borne by customers rather than Capital as contractor. He said initial travel and logistics disruptions seen in recent weeks have largely normalized.

Guidance Maintained

Capital maintained revenue guidance issued with its full-year results in March. Boyton said the company continues to expect revenue of $410 million to $440 million, implying a return to a growth path of about 20% year-over-year revenue growth.

Within that outlook, MSALABS revenue guidance remains $85 million to $95 million, compared with $73 million last year.

Boyton said the company has announced multiple new long-term contracts and raised capital in late 2025 in response to an increasing demand pipeline. He said that capital gave Capital the ability to preempt some asset purchases, including equipment for the Sukari mining contract.

Discussing market conditions, Boyton said record commodity prices, particularly gold, are generating record free cash flow for Capital’s client base. However, he said the company has not yet seen a significant inflection in exploration spending, although it is seeing more mergers and acquisitions activity, increased brownfields budgets at mine sites and early signs of rising exploration demand.

“We’re very much of the view that we’re at the front end of the demand cycle as it relates to the service providers,” Boyton said, adding that Capital believes it is well positioned for strong demand in the years ahead.

AGM Resolutions and Shareholder Questions

The meeting included 12 ordinary resolutions and two special resolutions. The operator said the resolutions included adoption of the 2025 financial statements, approval of the directors’ remuneration report, re-election of directors, reappointment of BDO as auditor, authority for directors to agree auditor remuneration, authority to allot and issue equity securities, authority to issue shares for cash without pre-emption rights up to about 5% of issued share capital, and authority to make market purchases of up to 22,570,159 common shares.

Final voting results are expected to be announced through Capital’s regulatory information service and published on its website.

In a question-and-answer session, Ryan Tennis, Head of IR, asked how scalable the current operating model is. Boyton said corporate infrastructure is scalable, but the mining fleet has little latent capacity. He said drilling could potentially add utilization of “maybe another 10 rigs,” while MSALABS has significant operating leverage, with the ability to add $30 million to $40 million of revenue by putting more volumes through existing infrastructure.

Asked about Capital’s market position versus competitors, Boyton said it has “unequivocally” improved. He said Capital differentiates itself through safety standards, equipment standards, training and development programs, and delivery, and that stronger market conditions have improved its competitive position.

About Capital LON: CAPD

Capital Limited is a leading mining services company providing a complete range of drilling, mining, maintenance and geochemical laboratory solutions to customers within the global minerals industry. The Company's services include exploration, delineation and production drilling; load and haul services; maintenance; and geochemical analysis. The Group's corporate headquarters are in the United Kingdom and it has established operations in Côte d'Ivoire, Canada, Democratic Republic of Congo, Egypt, Gabon, Ghana, Guinea, Kenya, Mali, Mauritania, Nigeria, Pakistan, Saudi Arabia, Tanzania and United States of America. Our brands include Capital Drilling, Capital Mining, MSALABS and Well Force International. Capital Drilling provides a complete range of drilling solutions for projects across the mining cycle from exploration to production. Capital Mining provides Load and Haul services for clients from development to fully operational mine sites. MSALABS are a global provider of geochemical laboratory services for the exploration and mining industries and have an exclusive agreement with Chrysos Corporation to deploy their revolutionary PhotonAssay technology globally.

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