Geodrill (GEO:TSX) reported record revenue in its first quarter of fiscal year 2022 on the back of strong drilling demand.

The company, which provides drilling services to gold and other exploration companies, reported Q1 revenue of $33.4M, a 9% increase from the same period in 2021. In 2021, the company achieved an outsized revenue increase of 70% year-over-year, so while this year's nine percent may seem relatively modest, it's on the back of phenomenal growth the previous year.

While predominantly focused on West Africa, Geodrill has expanded its geographical footprint with new contracts in Egypt and also expanded its presence in South America.

On January 11th, Geodrill announced a US$45M contract with Perseus Mining, and another with Centamin for drilling at its Sukari mine in Egypt worth an estimated US54M on February 1. A third contract with Endeavor Mining rounded out the trio of new contracts since the new year. Combined, the deals will add more than $130M in revenue in the coming years.

With these new contracts having yet to show up in Geodrill's already strong quarterly results, strong growth remains the forecast for the driller.

That outlook is underpinned by the robust mood Geodrill CEO Dave Harper is currently encountering at Mining Indaba, the world's largest mining investment conference being held in South Africa this week.

"There's a sense of optimism that's palpable. Rising interest rates and raging inflation are perhaps reminding many investors of the value of gold as a safe haven," said Harper. "That's reinforcing what was already a strong market."

"We're going to continue to benefit from strong gold and commodity prices that are driving demand for our services. We've increased exploration budgets, pushing utilization higher, we're now also seeing increased pricing for our services," he continued. "We expect to keep executing at a solid pace, delivering steady revenue growth and profitability. The remainder of the year looks robust on every front."

Paradigm Capital agrees. It published a note on the company on May 10 with the title "Q1/22 Results Outperform, Expectations Remain Strong" and has a buy rating with a 12-month $5.00 price target.

A Flash Note from TD Securities said the results were "a great start to the year and we are encouraged by management's outlook." TD has a buy rating on the stock with a $4.25 price target.