Good afternoon, ladies and gentlemen, and welcome to the Precision Drilling Corporation 2014 Fourth Quarter Results Conference Call and Webcast. I would now like to turn the meeting over to Mr. Carey Ford, Vice President, Finance and Investor Relations. Please go ahead, Mr. Ford.

Thank you, and good afternoon, everyone. I'd also like to welcome you to Precision Drilling Corporation's Fourth Quarter and Year-End 2014 Earnings Conference Call and Webcast. Participating today on the call with me are Kevin Neveu, our Chief Executive Officer; and Rob McNally, our Executive Vice President and Chief Financial Officer. Also present is Gene Stahl, President of Drilling Operations; and Doug Strong, President of Completion and Production Services. Through a news release earlier today, Precision Drilling Corporation reported on the fourth quarter and year-end 2014 results. Please note that the financial figures are in Canadian dollars, unless otherwise indicated. Some of our comments today will refer to non-IFRS financial measures, such as EBITDA and operating earnings. Please see our press release for additional disclosure on these financial measures. Our comments today will also include statements reflecting Precision's views about future events and their potential impact on the corporation's business, operations, structure, rig fleet, balance sheet and financial results, which are forward-looking statements. We caution you that these forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from our expectations. Please see our press release and other regulatory filings for more information on forward-looking statements and these risk factors. Rob McNally will begin the call with a brief discussion of the fourth quarter operating results and our financial overview. Kevin Neveu will then provide our business operations update and our outlook. Rob, over to you.

Thanks, Carey. Earlier today, we reported a record fourth quarter with revenues and EBITDA of $619 million and $234 million, respectively. We also announced a quarterly dividend of $0.07 per share. Fourth quarter 2014 EBITDA was $234 million, which is 18% higher than the fourth quarter of 2013 and 18% higher than the third quarter of 2014. The higher Q4 results primarily reflect increases in U.S., Canadian and International Drilling activity and increased U.S. margins. EBITDA margins were 38% this quarter versus 35% in the fourth quarter of 2013. For the year ended December 31, 2014, revenue was $2.4 billion, up 15% versus 2013. EBITDA was just over $800 million, which is an increase of 25% versus 2013, and an all-time high for Precision Drilling. Activity was higher in all of our drilling businesses partially offset by declining activity and pricing in the C&P business. In the U.S. during the fourth quarter, margins were up approximately $600 per day over the third quarter of 2014 due to lower operating cost, partially offset by lower average revenue. Compared to the fourth quarter of 2013, U.S. drilling margins were up approximately $900 per day due to higher average day rates and lower cost per day. Precision's drilling activity in the U.S. improved by 12% year-over-year. As of today, we have 84 rigs drilling or moving in the U.S., and 5 idled but contracted rigs. We have also had 2 contracts terminated in the U.S. In Canada, drilling margins declined by $600 per day year-over-year driven by higher labor costs and slightly lower average dayrates for smaller rigs. Drilling activity increased about 4% over the fourth quarter of 2013. Today we have 79 rigs drilling or moving in Canada. Our Completion and Production segment revenues were $89 million, up 5% over the fourth…

Thank you, Rob. Good afternoon. And at the risk of being a little repetitive with a few broad comments, I'll go on and explain how we plan to manage ourselves through this market. So first of all, the line drilling market is once again experiencing an abrupt and severe reduction in demand. Our customers are in a loop of recalibrating capital spending. They're managing cash flows. They're working to sustain production, all while managing their balance sheet stability and ultimately seeking ways to reduce their cash costs. The result is really apparent in the sharp rig activity declines already apparent and pricing pressure and aggressive cost management throughout the oil services supply chain. At Precision, we are well honed for this downturn. Our business is structured in variable format. Our new investments are secured with long-term take-or-pay customer contracts. And the Precision rigs fleet is among the best high-performance land rig fleets in the world. Precision's capital resources are our balance sheet, and our capital structure provides the dry powder to weather this downturn while we remain poised to capitalize opportunities if and when they arise. So let us spend a few minutes telling you how we manage through business cycle. I'll talk about some of the trends we're seeing and I’ll give you a sense of what we expect over the course of the year. But I think the first consideration in a downturn is how and where the company is positioned. In that regard, our fourth quarter was the best on record for the company, both financially and operationally. Most notably, we increased our contract coverage and the year-over-year growth momentum we carried through the first 3 quarters of the year continued on to the fourth quarter. So as we enter [indiscernible] cycle, our starting point is very…

[Operator Instructions] The first question is from Jeff Spittel from Clarkson Capital Markets.

As you guys are aware, in the initial phases of the downturn typically you see a lot of margin pressure for service companies before the cost-containment initiatives can kick in and maybe provide a little insulation. But given that you were very proactive and you started to implement some of these measures late last year, is it reasonable to expect that maybe that margin pressure over next few quarters won't be as pronounced as it might otherwise be?

All right, Jeff, really tough question. So what I would tell is, a couple of things I think are interesting. We often say that this downturn is different than the last one, or things are different. One thing that's different this time is our customers didn't pause or didn't wait. They came on hard right at the get go with pricing pressure. So the pressure on pricing was almost instantaneous right across the boards. And so as a result, while we may have been ahead of things slightly with our cost-containment work internally, customers were quick on the -- off the starting blocks also. So that's probably a little different than 2009. But I'd also tell you that we’ve worked hard over the past 3 or 4 years to leverage our scale and our size. I think we've done a great job over the past couple of years both controlling and pushing our cost down. So I think we're in a good should coming into this. But we've worked with the vendors already. We've got some vendors coming in proactively reducing cost. Very constructive partnership type of negotiations with many of our vendors on the cost side. All that said and done, we're getting single-digit type cost improvements on the vendor side, and customers are expecting and demanding significant cost reduction. So I don't think that we can mitigate pricing pressure with cost control.

Sure, sure. I appreciate that color. And then maybe, as we think about the balance sheet and capital allocation priorities, it's in great shape heading into the downturn. You get the stock trading below tangible book value. Does that compel you to revisit share repurchases as a potential option or maybe moving it up in terms of priorities here? Or are we just going to strictly focus a little bit more on cash preservation in the near term until we get some more clarity?

Jeff, this is Rob. I think that it's obviously a compelling idea to repurchase shares when our shares are trading at this level. But until we see how the world settles out, I think we're more inclined to be conservative with the balance sheet and hold the cash for now.

The next question is from Dan MacDonald from RBC Capital Markets.

Just wondering. I'm looking at the newbuild schedule. Is it kind of safe to assume at this point you're kind of past the drop dead date to defer any further newbuilds for 2015?

Short answer, yes.

Dan, I fully expect that the 17 rigs that we talked about in the press release today will all get delivered.

And then I guess, do you have a sense then for what the potential might be for those rigs to displace perhaps other of your rigs your clients are using on a shorter term basis? Or do you think they'll be fairly incremental?

The rigs counts are coming down. The industry rig counts are coming down. While we have these rigs in the market, I don't expect our rig count is going to rise.

And just on the cost side, in reference to your thoughts that it's the worst, most challenging conditions in a decade. In '09, we did see the industry roll back wages on the Canadian drilling side. Do you think that the possibility exists for us to see that as well this time around or is it a little different?

Dan, it's obvious we're looking at every avenue to save money for ourselves and maximize that spread between cost and sale. I kind of personally feel like the field labor force right now is bearing the full brunt of job risk. And I'm actually just trying to protect the guys who have worked so hard for us over the past few years, let them continue earning at this rate.

The next question is from Doug Becker from Bank of America Merrill Lynch.

Kevin, I thought it was pretty notable that only 2 contracts were terminated. What would you attribute that to? Is there something from a pricing standpoint, a contracting standpoint or just a performance standpoint? Because that's really pretty remarkable in the context of what's happened to oil prices and what we've seen from competitors.

Doug, in 2009, I think we had 1 termination during that entire downturn. I know how we interact with the customers. I know -- I've been out to our rigs. I visited the rigs as recently as a few weeks ago, and I see the work we're doing in the field. My personal feeling is [indiscernible] of our people in our rigs. I don't get a chance to visit every single customer and every single rig, but I'm very impressed with what I'm seeing, I'm very impressed with the relationships we have and we manage and maintain. It's early yet to draw -- ending conclusions here. Do we think we'll have more rigs going into idle but contracted? And we saw that in 2009. My conclusion is that our customers want to hang on to our rigs. Even if they don't need them today, they might keep them on the IBC status so they have control of the rig. And if they get a bounce back in commodity price, if they decide to expand the program, they have access to one of the best rigs in the fleet. So my feeling is, those numbers are driven by great field and operating performance.

And even for the 5 contracted but idle rigs, you don't see disproportionate risks of those being terminated?

Well, from a financial standpoint, we're kind of indifferent, frankly, because on IBC, we're earning full margin. If they're terminated, we get a front-end payment for full margin. Frankly, the best model is the rigs stays working because then everybody gets maximum value. They get the value of the rig drilling and we make the profit off the rig. So I kind of think second best is they keep control of the rig but we make a profit.

Got it. If we think about sustaining CapEx going forward, I think you were alluding to something less than $100 million. If we stay in a prolonged downturn, should we be thinking about 2016 CapEx kind of around that level? And I realize it's still very early days and a lot of things can change.

Before we get into projecting 2016 maintenance CapEx, there's always utilization base, always utilization base. You can draw your math pretty easy. If you're thinking utilization '16 is lower than '15's averages, then maintenance CapEx should be lower than '15's maintenance CapEx. In '09, we ran $60 million of maintenance CapEx.

Doug, if the industry is still in a ditch in 2016. I suspect we'd be well below $100 million in maintenance CapEx.

Okay. That's helpful. And then maybe a bigger picture question. It sounds like you're getting good traction with the directional drilling lines for Schlumberger. During downcycles in the past, we've seen some reluctance to adopt new technologies. Maybe you can give us some color what type of our costing are being observed and how technology adoption might be a little bit different in this cycle than in the past cycles.

Yes. So industrial logic and commercial decisions don’t always line up perfectly. And there's no question that our integrated model has great industrial logic, and frankly, great commercial value for our customers. But your comment about taking on new business models during downcycles is common. Doug, what's happening right now is the pricing work being done by our clients is being done primarily by, let's call it, the procurement elements of our customers, not the value elements. There will be a transition in the next few months when they move away from just drive the price down to really focusing on well value. And -- that's rig efficiency will get to be more important -- [indiscernible] back important. And that's where we get close to bottom. And then I think our integrated model will look and will have the clear value our customers need to see. So I think this will be a good market for us, but it's too early yet. We're still in the procurement, drive-the-price-down phase. It will transition, though, into efficiency and performance phase very soon. And that's where integrated services, I think, will really gain some traction.

The next question is from Dana Benner from AltaCorp Capital.

I wanted to start with, I guess, the notion of pricing weighted average pricing, et cetera. And to do that, you've mentioned that during the first quarter, I think, it's 124 rigs on term. And you've got, let's call it, 180 rigs running currently, so that math would put it at, say, 69% to 70% of your active rigs on term. So I guess in that sense, there's pretty good protection of the active rig fleet in terms of pricing, and in reality, it's the minority of rigs that are subject to the pricing pressures that you speak of. Is that a fair conclusion?

Yes. So Dana, that's a fair conclusion. The rigs that are under contract, we expect to get full price on these rigs. What will muddy the water a little bit are the handful of rigs that go to IBC, where we're basically paid the margin but the costs go away. So that will muddy the water a little bit, but the premise is right.

Right. And then you note that you've got 105 on average, I think, on term for the year. Canadian count comes down in Q2, we’ll see what happens in Q3. U.S. maybe a little bit more. So in reality, of your active fleet in fact, you could argue that maybe 80%, 85% of your active rigs are in fact somewhat backed by pricing protection and it's in a very low minority of active rigs that are incurring those low spot rates? Is it true?

That's correct. And the percentage, I think, is less important than just the sheer number of rigs under contract because we may end up having additional rigs working but not generating a lot of cash flow, but the rigs that are under contract. We're highly confident that, that cash flow is safe.

Right. I just wanted to draw that out because I think sometimes people forget exactly the proportion of both categories. Secondly, I'd be curious, Kevin, to know, what has surprised you so far in Q1? I mean, I think the reasonable comparison is 2009 in terms of the way activity has fallen off, it's even been sharper, and so with the benefit of I guess all these years now watching PD, Precision, grow and the market change, what has surprised about what your clients are doing or the way the market has evolved based on what you're seeing?

Dana, a great question. I think there's 2 things that I think are a bit interesting this time around. The first thing I mentioned on the call earlier was how quickly our customers responded with this pricing intensity. There is just no lag time, no pause. We had our internal conference call that Friday morning after the OPEC meeting. I suspect most of our customers did almost the same thing and they were on the pricing game very quick. So no lag time, no waiting, no pause. So I think that's -- balance sheet diligence and cash flow diligence, that's probably a good thing for the industry. I'm also a little surprised in Canada. I didn't expect it to be -- to have probably more drilling intensity in Q1 and roll the dice through the rest of the year. It really feels like there's a bit of throttling back of Q1, preserve a bit of capital for later in the year. Now I could be wrong, but it just feels like there's inordinate reduction in drilling in Canada.

Interesting. Just one final question before I turn it back. Do you think it's better to be big with all the systems and supply chain management efforts that you've put in place to date? Or is it better to be small and nimble in a market like this?

Well, Dana, it's hard to beat the mom-and-pop with husband and wife and 5 rigs. The overhead is 2 people, and that's hard to beat. So I understand there's a level at the very bottom, which has de minimis of corporate costs. But I would tell you, if you're comparing 30, 50, 60 rigs to 240 or 230 Tier 1 rigs, we have a significant operational and cost leverage across that fleet, both customer diversity, geographic diversity and pricing leverage and systems leverage. There's no comparison.

The next question is from Scott Treadwell from TD Securities.

I wanted to pick up on the customer sentiment angle of things. It seems like the rig cuts have been more driven by expediency than a drive for efficiency. The guys are managing their budget to a number and just looking for the low-cost way to get out of activity. Have you seen discussions yet of any sort of consequence where guys know they've had to lay down rigs they don't want to lay down? Maybe this goes to the idle but contracted phenomenon. And there is potential for high-grading of customer fleets, and obviously, by extension, the rigs that are going to work, which could impact you guys. Or is it still very sort of frenetic and crazy, you can't really talk about anything concrete yet?

No, actually, I think, the way you described is kind of where we're expecting, Scott. Certainly, there's a drive right now to slam down the cost. And so I tell you, it's very orderly but aggressive reduction of activity. So activity reductions, cost reductions, do everything you can to drive down cash costs and cash spending. There's very little talk right now so far regarding high-grading or performance enhancements or performance improvements or things we can even do like bringing in directional drilling on a job to improve the efficiency of the job. We're still in that "Let's figure out how little we need to run before we figure out how better to run" mode. We'll transition I think probably either late this quarter, early next quarter, into more of a -- less of a price crash, more of an efficiency conversation with our customers. That could be as early as late February, early March or maybe as late as April, May. But I don’t think it stretches beyond that.

Okay, perfect. That's sort of what I thought. Just on the deferrals and cancelations. Have you seen those slots go away for a customer, i.e., he's canceled that rig #6 or #7 or whatever it is he's using? Or was it, I don’t want the newbuild, let's put that on pause or cancel it? And is there another rig that can service that need?

I wouldn't say that there's been 0 activity like that, but for us, it's not meaningful.

Really -- Scott, it's just the 2 rigs that we ended up being able to fill the need with existing rigs. But otherwise, the newbuilds will get built. And I think that additional newbuild activity will clearly be paused until the industry strengthens.

Okay. I wanted to maybe touch on the margins a little bit as well. I know you had some good performance. You opened the Canada tech center, and you've obviously had the U.S. one up and running for a while. But I mean, as rig count comes down, there is a fixed cost associated with that. So was there anything kind of structurally different you did in Q4 to sort of manage that? Or was it, just as sort of a previous question, better performance and just keeping an eye on the nickels and dimes?

Yes. So I think it's the latter, Scott. I mean, we're getting in Q4, we're kind of hitting our stride with the tech center in the U.S. and getting closer in Canada. So we're kind of seeing the full benefit of that. We're doing a better job of managing labor cost. I mean, there's a number of pieces that went into that. And I think those will still continue. But as you point out, as the rig count comes down, we do lose some of the scale efficiencies, where we're supporting less rigs with that overhead. The overhead is not completely fixed, but there is some portion of it that is. So that will offset some of the gains that we've had.

And I think it's worth pointing out, Scott, that our new Nisku tech center didn't actually increase overheads. We just modernized the facility and will have operating efficiencies in the shop. But from an overhead G&A perspective, likely that might go down slightly. So we've actually brought 3 facilities under one roof rather than just 3 different facilities. But it will be a de minimis reduction as opposed to an increase.

Okay. My last one is on working capital. Obviously, as things slow down, you would expect the receivables to monetize. Are there any trends you're seeing there yet? It's probably a little bit early for anything. And do you have any idea of what that number might look like as you manage your inventories down on a reduced capital program and payables would go with it? And then the receivables come down. I mean, is that sort of -- could be $100 million if we're down kind of 20%, 25% on activity? Or could it be $200 million or $300 million?

Scott, so directionally, the working capital will come down. We'll get working capital coming back out of the system, and it probably sits somewhere between $100 million and $200 million.

The next question is from John Daniel from Simmons & Company. John M. Daniel - Simmons & Company International, Research Division: Kevin, you noted in the prepared remarks the opportunity or your hope that you'll be able capitalize on opportunities as they arise in the cycle. Can you provide some color on what types of opportunities you're interested in? And then just a bit more. How much of your time today is actually spent looking at opportunities versus just dealing with the crisis at hand?

So John, listen. What's really in our crosshairs, I think, is that the market is going through rebalancing right now. But I suspect when everything settles out and commodity prices stabilize a bit, likely there's still a shortage of high-spec pad capable rigs. And it's not apparent right now. I mean, there are pad rigs being laid down right now today, but the market hasn't sorted itself out. I think it will. I don't think there's enough high-spec pad capable of super high efficiency rigs to support the market on a sustained basis. And we're talking to those customers. We kind of know what their long-term plans are, not short term. So I think there will be an opportunity for us to build rigs, maybe not in 2015 but maybe in 2016, for the high-efficiency, core center-of-the-plate-type opportunities. So having that opportunity I think is really important for us. On the M&A front, we'd like to look and be engaged in everything that's out there. We're pretty picky when it comes to rig spec and quality, and we've been so successful with our own design rig. And hear me loudly on this one. I think a PD Super Triple is among the best rigs in the world, except for us, it's the perfect rig. It's got the standardization and the fit and other equipment that our people are trained for. So having a PD Super Triple 1500 has a lot of value to Precision. So that's where most of our crosshairs are centered right now. John M. Daniel - Simmons & Company International, Research Division: If we were to assume that most people like their own designs, you think that, that limits consolidations in the land drilling space later this year?

Well, it certainly makes it tougher to pay a premium for the asset which is vastly different. John M. Daniel - Simmons & Company International, Research Division: Rob, thank you for the candor with respect to pricing trends. But I want to follow up on Dana's earlier line of questions. As we try to balance the lower spot pricing vis-à-vis the fact that you've got better rig mix working in Q1 as well as the contract coverage, any color with respect to the directional movement and cash margins? And perhaps, which I know you'd be reluctant to, potential magnitude of change would be appreciated.

I think that, John, it's a bit early to call it, but I think that cash margins probably won't move a lot. And that's primarily because of the contract coverage that we have. We are going to realize the full margin on all of those contracted rigs, and that makes up the largest percentage of our rigs. And certainly, the rigs in the spot market margins will be impacted as pricing comes down and we'll offset that some on the cost side, but not nearly as much as the revenue moves. John M. Daniel - Simmons & Company International, Research Division: Okay. And then just the last for me on international. As you look at the current portfolio of rigs, you've got the contract coverage, et cetera. How quickly did that customer base react to the changes in commodity price with respect to coming back to you [indiscernible] as you can speak from an industry perspective, to beat on you on price? I mean, here in the North America, it's like as soon as there's a change, they'd be on here right away. When would you expect -- is there any risk that those contracts perhaps get amended? Is that a possibility this year in terms of the price?

I think that's a pretty low risk in the way we do business.

The next question is from Jeff Fetterly from Peters & Co. Jeff Fetterly - Peters & Co. Limited, Research Division: On the contracted side, how many rigs would be under contract for 2016 at this point?

Jeff, we haven't disclosed that. Typically, we will disclose that later in the year. But just to make it, let's say that it's -- we have a meaningful rigs -- we have a meaningful number of contracts in hand already for 2016 that will -- that give us some comfort that we've got a good portion of our cash flow for 2016 already locked up.

Our contract profile today is frankly much better than it was back in 2009, both for duration and for a number of rigs under contract. So we feel pretty good about our positioning for short term or a sustained downturn. Jeff Fetterly - Peters & Co. Limited, Research Division: Just to clarify the comment earlier, you said 124 rigs under contract for Q1?

I think that's the number, that's right. Jeff Fetterly - Peters & Co. Limited, Research Division: So is it safe to assume that your exit contract number will be 75 or 70 rigs?

Yes, I mean you can do the math. It's not that exactly linear but that's close enough. I mean, it gives you a pretty good sense. Jeff Fetterly - Peters & Co. Limited, Research Division: Okay, the rigs that come off of contract over the course of 2015, how much of a discrepancy in terms of day rate do you expect them to go to move on?

Well, luckily, not many are coming off contract right now because right now, we've discussed where the spot market prices are. Probably a better sense for that, Jeff, at the end of our Q1 call, into Q2. Probably you've got a question for us in April. We really don't have good visibility right now.

If rigs coming off today, or if they were in the spot market today, you really are looking at 15% or 20% straight away. Jeff Fetterly - Peters & Co. Limited, Research Division: Okay. And do you have any visibility in terms of when or how you think that might flatten itself out?

Not yet. Jeff Fetterly - Peters & Co. Limited, Research Division: I guess the ultimate question in that is how much are you willing to take from a pricing standpoint before it doesn't make sense to redeploy immediately?

Well, Jeff, it's probably not just a simple as rig comes off contract and goes straight to the spot market. It isn't that simple. So for example, if we have a rig drilling for an operator in Eagle Ford. He's drilling a certain type of pad and a certain type of well, and it rolls off contract in, let's say, May of this year. If it's drilled for the last 2 years or 3 years -- 3 years under long-term contracts, it knows the well, it knows the field, it knows the company men, chances are we don’t need to go right down to spot market rates on that rig. Chances are some nominal discount for that customer for that rig that has no risk for it, then we'll keep that rig working. So I don't know if that's going to happen or not. You have to ask us again in April. But our experience has been that on the first rollover of a newbuild rig in a long-term proven program, spot market rates are less impactful.

And I think it's important to differentiate. We've been talking kind of generally about spot market rates, but it's not as defined right now, but it will clean up again. There is a real difference between the spot market rates for legacy Tier 2 rigs versus high-spec Tier 1 rigs that are walking rigs on pads. These are 2 different markets, and that will get differentiated again as we move forward. Jeff Fetterly - Peters & Co. Limited, Research Division: The comments you made earlier about 15% to 20% in the Permian and Eagle Ford, et cetera, would you define that as a Tier 2 pricing pressure right now or is that a Tier 1 spot market rate [indiscernible]?

Just broad market comments. I mean, as I said earlier, we're not really in an efficiency discussion with customers right now. This is more of a procurement exercise to try drive out -- drive down prices. So the guys we're talking to at this point -- and I've been called myself into a number of customer meetings. I'm being introduced to the head procurement officer or the Senior VP of procurement, not the head of drilling. So right now, right now today, the discussions aren't about value or performance; it's just about price. Jeff Fetterly - Peters & Co. Limited, Research Division: As you manage the business through this downturn, are you expecting this to be worse than 2009? Or do you expect the trough on the rig count in the U.S. to be lower than 2009?

So Jeff, the answer is we don't know. It looks pretty similar in terms of the pace of which rigs are being laid down, and so we don't know if it's going to be more rigs laid down or not. I think actually the more important question is, what's the duration. In 2009, we hit the bottom and bounced back pretty fast. I think that the bigger question here is how long are we going to be in this kind of $50 or $60 oil world? Because that's going to have a bigger effect on how deep we go if we bounce right back. But the other difference for us is we're a way different company today than we were in 2009. Our balance sheet is in far better shape. We've added well over 100 Tier 1 rigs. We've got a better contract position. So for us, this is a lot less intimidating than 2009. In fact, as we look at what's coming, whether it lasts for 2 quarters or 6 quarters, we're highly confident that we're going to work our way through this and come out on the other side in good shape.

I'd also throw in that in 2009, we've just completed the Grey Wolf merger. Our customers in the U.S. weren't completely affiliated with Precision at that point. Today we've got multiple years of track record on this client base. So we just feel much more comfortable in this market today than we could possibly have felt in 2009. Jeff Fetterly - Peters & Co. Limited, Research Division: Okay. A different vein. What's your assessment of the Schlumberger partnership success so far and performance of the directional drilling business today?

We're very, very pleased with the progress so far and very pleased with customer uptake so far, despite the market challenges in the broad base. So that's why I'm quite optimistic that when the market moves back into focusing on value, we'll have some good traction. Jeff Fetterly - Peters & Co. Limited, Research Division: Okay. And so how do you reconcile that against the financial performance for that business in recent quarters being essentially stagnant to modestly declining?

I think the margins and day rates in directional drilling are under a lot of pressure right now. Jeff Fetterly - Peters & Co. Limited, Research Division: Okay, and just to clarify your comment earlier. Do you expect or will strategically you guys be looking at trying to make some bundling pitches to the client side?

We'll -- this is a great time for us to use some of our ancillary services, like rental packages and camps, to help lever more volume out of the customer. If the customer's looking for us to save money, we can include things like rental packages or camps and catering services to help lower the cost for them. But I don't really think there's a lot of value in bundling, it's more of a strategy for us to try to create more value for the customer.

[Operator Instructions] The next question is from David Wishnow from GMP Securities.

A quick question and apologies if I missed this. But as I look at the newbuild schedule, it looks like 2 rigs in Canada got pushed from 4Q '14 to 1Q '15. Is that the case or are those rigs -- I guess was that a manufacturing delay or was that a customer-requested delay on taking delivery of those rigs? I'm just kind of wondering what's going on there.

David, I think, those were rigs that were -- they were third week of December deliveries. And when you get to that late to the year, with Christmas breaks, they end up sliding into the first week of January. I don't think it's -- there's no meaningful or material difference by customers or by us.

If there's any movement, it's a matter of weeks.

Okay, got it. That's what I figured. Another question, and to follow up, clearly, it's still very early in the cycle, but this is probably the first cycle where you have enough kind of AC Tier 1 rigs out there to really be a critical mass. Are you guys expecting to see bifurcation develop within what has historically been the Tier 1 fleet, perhaps older AC rigs or some of the very high spec SCRs, where going forward you may not be considered the kind of new level Tier 1?

So a couple of things. There will be some bifurcation between pad walking rigs and non-pad walking Tier 1 rigs. So I think that's kind of what I was alluding to earlier, where the demand for potentially more pad walking rigs. I think that the most efficient way to drill a core property is going to be with a pad walking rig. You can walk well to well in 45 minutes. So there will be a dayrate premium and a shortage of those types of rigs. Now moving to the broader category of Tier 1 rigs, AC or DC, I think our customers actually know rig by rig which rigs perform very well. We have some DC SCR microprocessor-controlled e-drill rigs that can drill as well or better than any AC rig anywhere on ROP. And our customers know that, and I think our customers know which rigs work well and which rigs maybe don't quite work as well. And I think that's why you see variance in dayrates between various drilling contractors.

Okay, got it. So it's safe to assume that you could see what historically we would call Tier 1 assets potentially not recover as quickly coming out of the trough whenever that does happen?

Sorry, you broke up for a minute. Repeat the question?

I was saying, so in theory, you could see whenever this rig count does trough and people start focusing on rig efficiencies, clearly, the pad walking rigs will be the first to recover. So -- but it sounds like it's safe to assume that what historically you call all Tier 1 rigs don’t necessarily recover at the same rate?

No, I wouldn't agree. I think the Tier 1 high spec market is going to do well when the market rebalances and commodity prices respond. While I'll say the best wells will be drilled in the core by pad rigs, there's still going to be a broad wide market for high spec, high-efficiency drilling and moving rigs. So I'm not bearish in the broad -- on the Precision definition of Tier 1 rigs.

The next question is from John Daniel from Simmons & Company. John M. Daniel - Simmons & Company International, Research Division: Kevin, more of like a sort of theoretical question, if you will. But as you have discussions with your customers, are any of them telling you that they will not ever need to return to the sort of the prior peak levels recorded in the Q4 time frame, just due to the efficiencies?

No. But again, John, so the short answer is no, not at all. No one has said that. But beyond that, right now, again, the guys that make those decisions aren't the guys we're talking to. We're talking to the guys who are charged with getting 15%, 20% out of the vendor base. But John, you do know I spend time with another E&P company. That type of conversation, I don't think it's common that you're suggesting.

The next question is from Dan Healing from The Calgary Herald.

I just wanted to ask a bit about how this downturn is affecting your employees that aren't out in the field. I think you mentioned earlier there's a hiring freeze and a wage increase freeze. Is there anything else going on? Or is there anything planned in terms of reducing staff or doing anything like that?

Dan, our sort of fixed headcounts fall up and down with the activity levels kind of all the time. They go up, they go down. There is no company-wide or newsworthy event there to talk about.

Okay. And you're cutting back a bit on manufacturing. Is that part of the company being affected?

Well, we're slowing down and deferring rig building. And as I said earlier, I think that business will return at some point in time. So sustaining capability is important for us. But we're also mindful of managing our cost in the area. What we do is we utilize a lot of third-party vendors and outside sourcing. So as far as Precision goes, we can manage that pretty easily internally.

Okay. And maybe one larger picture question. When do you think this is going to turn around? Do you have forecast or prediction?

Well, for those of us in the oil service industry, if we knew that answer, we wouldn't be doing this job. Hey Dan, just to hit that point, though, this whole cycle is not new to anybody in the Calgary oil services business, and I think most of us know how to manage our businesses through this well and make sure that we're healthy and strong coming out the backside, and that's what we're doing.

There are no further questions registered at this time. I would now like to turn the meeting back over to Mr. Ford.

Yes, operator, I think we have maybe one more question.

We do have time for one more question from Brad Handler from Jefferies.

You've obviously covered a lot of ground. I guess I was curious about something that -- the conversation that's floating around. I'm curious if you have some perspective on it. Are you sensing that your clients are drilling and not completing wells [indiscernible] speak to both?

We don't have any visibility on that at all. We can't comment.

Yes, that makes sense. I'll just figured I’d throw it out there.

When we finish the rig or the pad, we're gone. And we see a lots of pressure from the trucks driving up and down the road. We don't know where they're going.

There are no further questions registered at this time.

That concludes our fourth quarter conference call. Thanks for joining us today.

Thank you. The conference has now ended. Please disconnect your lines at this time. Thank you for your participation.