JUNE 11, 2002 – SAN ANTONIO, TEXAS – Pioneer Drilling Company (AMEX: PDC) today reported results for the fiscal fourth quarter and year ended March 31, 2002.

Revenues for the fourth quarter of 2002 were $15.6 million compared to revenues of $14.4 million in the fourth quarter of 2001. Earnings before interest, taxes, depreciation and amortization, or EBITDA, was $3.0 million in the fourth quarter of 2002 compared to $3.3 million in the same period last year. Net loss attributable to common shareholders in the fourth quarter of 2002 was $19,000, or $0.00 per diluted share, versus net income of $1.4 million or $0.09 per diluted share during the fourth quarter of 2001.

Revenue days were 1,240 days during the fourth quarter of 2002 compared to 1,007 days for the fourth quarter of 2001 due to an increase in the rig fleet from 16 rigs at the end of 2001 to 20 at the end of 2002. Drilling margins were 23 percent, or $3.6 million, versus drilling margins of 25 percent, or $3.6 million in the fourth quarter of 2001. Average rig utilization for the fourth quarter was 69 percent, down from 93 percent last year, primarily as a result of continued slow down in land drilling activity due to lower oil and gas prices.

Michael E. Little, Pioneer Drilling’s Chairman and Chief Executive Officer, stated, “As the demand for land rigs has continued to weaken throughout the year, we have closely monitored and controlled our cost structure while continuing to seek growth opportunities that add shareholder value. We believe that current market conditions offer certain opportunities to increase or enhance our fleet at favorable prices. As we enter fiscal 2003, we have acquired two recently refurbished Ideco H-725 12,000 foot mechanical land rigs and have agreed to acquire two 1500HP diesel electric rigs rated to 18,000 feet, which will be comprised of primarily new equipment.”

Revenues for the twelve months of 2002 were $68.2 million, an increase of 36 percent from $50.2 million in the twelve months of last year. EBITDA increased 159 percent to $19.7 million in the twelve months of 2002 compared to $7.6 million in the same period last year. Net income attributable to common shareholders in the twelve months of 2002 was $6.2 million or $0.35 per diluted share, compared to net income of $2.4 million or $0.19 per diluted share during the twelve months of 2001.

In fiscal 2002, Pioneer completed 5,384 revenue days, as compared to 3,463 revenue days in fiscal 2001, an increase of 55 percent. This increase reflects the increased demand for drilling rigs experienced in the first half of fiscal 2002 and the increase in the drilling rig fleet from 16 to 20 rigs by the end of fiscal 2002
Pioneer Drilling’s management team will be holding a conference call on Tuesday, June 11, 2002, at 11:00 a.m. eastern time. To participate in the call, dial (303) 262-2171 at least ten minutes before the conference call begins and ask for the Pioneer Drilling conference call. A replay of the call will be available approximately two hours after the call ends and will be accessible until June 18, 2002. To access the replay, dial (303) 590-3000 and enter the pass code 475750.

Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by accessing http://www.easterlyir.com. To listen to the live call on the web, please visit the Easterly Investor Relations web site at least fifteen minutes early to register, download and install any necessary audio software. For those who cannot listen to the live web cast, an archive will be available shortly after the call. For more information, please contact Karen Roan at Easterly Investor Relations at (713) 529-6600 or email karen@easterly.com.

Pioneer Drilling Company provides contract land drilling services to independent and major oil and gas operators drilling wells in central, south and east Texas. The Company’s fleet consists of 22 land drilling rigs that drill in depth ranges between 10,000-18,000 feet, with two additional 1500-hp land rigs to be added by January 2003.

This press release contains various forward-looking statements and information that are based on management’s belief as well as assumptions made by and information currently available to management. Forward-looking information includes statements regarding the Company’s anticipated growth, demand from the Company’s customers, capital spending by oil and gas companies and the Company’s expectations regarding its new rigs.
 
Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Such statements are subject to certain risks, uncertainties and assumptions, including, among other matters: general and regional economic conditions and industry trends; the continued strength or weakness of the contract land drilling industry in the geographic areas where the Company operates; decisions about onshore exploration and development projects to be made by oil and gas companies; the highly competitive nature of the contract land drilling business; the Company’s future financial performance, including availability, terms and deployment of capital; the continued availability of qualified personnel; and changes in governmental regulations, including those relating to the environment.

Should one or more of these risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. These risks, as well as others, are discussed in greater detail in the Company’s filings with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K for the fiscal year ended March 31, 2001.

Statements of Operations Three Months Ended Year Ended

3/31/02   3/31/01   3/31/02   3/31/01

UnauditedUnauditedRevenues:
Contract drilling15,671,748$ 14,381,309$ 68,123,538$ 49,935,853$
Other(37,461) 58,573 118,137 269,546
Total operating revenues15,634,287 14,439,882 68,241,675 50,205,399

Costs & Expenses:
Contract drilling12,079,124 10,790,395 46,114,337 41,476,824 Depreciation2,533,560 1,267,631 8,426,082 3,737,533
General & adm.565,771 347,765 2,428,394 1,116,727
Total operating costs15,178,455 12,405,791 56,968,813 46,331,084
Operating profit455,832 2,034,091 11,272,862 3,874,315

Other income (expense):
Interest expense(608,951) (256,857) (1,616,984) (888,863)
Interest income21,609 51,619 80,932 316,025
Other- 536,486 - 536,486
Total other (587,342) 331,248 (1,536,052) (36,352)
Earnings before taxes(131,510) 2,365,339 9,736,810 3,837,963
Income taxes(112,704) 952,719 3,418,525 1,135,174
Net income(18,806) 1,412,620 6,318,285 2,702,789
Preferred dividends- 60,000 92,814 274,630
Net to common(18,806)$ 1,352,620$ 6,225,471$ 2,428,159$

Earnings per share:
Basic-$ 0.11$ 0.41$ 0.22$ Diluted-$ 0.09$ 0.35$ 0.19$

Weighted average number of shares outstanding:
Basic15,922,459 12,116,799 15,112,272 11,137,171
Diluted17,365,962 14,663,273 19,221,256 13,901,101

Operating statistics:
Utilization rate69%93%82%91%
Revenue days1,240 1,007 5,384 3,463
Drilling margin3,592,624$ 3,590,914$ 22,009,201$ 8,459,029$
Drilling margin/day2,897$ 3,566$ 4,088$ 2,443$
Drilling margin % of revenues23%25%32%17%
EBITDA2,989,392$ 3,301,722$ 19,698,944$ 7,611,848$
EBITDA as % of revenues19%23%29%15%

Consolidated Balance Sheets

3/31/02   3/31/01

Assets
Total current assets16,516,218$ 8,252,184$
Net property, plant and equipment66,731,626 48,194,458
Other assets201,914 46,322
Total assets83,449,758$ 56,492,964$
 
Liabilities and Equity
Total current liabilities16,817,491$ 23,431,378$
Long-term debt and capital leases26,118,601 10,055,621
Deferred taxes7,170,661 5,179,203
Total shareholders' equity 33,343,005 17,826,762 83,449,758$ 56,492,964$