North Vancouver, BC - Cabo Drilling Corp. ("Cabo" or the "Company") (TSX-V:CBE) reports results for its fiscal year 2012 first quarter ended September 30, 2011.
1st QUARTER HIGHLIGHTS

*before changes in non-cash working capital items
The Company reports:

• Record quarterly revenue for the 1st quarter fiscal 2012 of $16.93 million, a 65% improvement compared to $10.27 million in the 1st quarter fiscal 2011.
• Record 1st quarter fiscal 2012 earnings before interest, taxes, amortization, stock-based compensation and other items (EBITDA) of $3.05 million compared to 1st quarter fiscal 2011 EBITDA of $1.01 million, resulting in 1st quarter fiscal 2012 EBITDA of $0.04 per share and $0.02 per share in the 1st quarter of fiscal 2011.
• Net before tax income for the 1st quarter of fiscal 2012 of $2.26 million compared to a 1st quarter fiscal 2011 before tax income of $307,544.
• Record net after tax earnings for the 1st quarter of fiscal 2012 of $1.52 million compared to net after tax earnings for the 1st quarter of fiscal 2011 of $197,544, resulting in 1st quarter fiscal 2012 net after tax earnings of $0.02 per share compared to net after tax earnings for 1st quarter fiscal 2011 of $0.00 per share.
• Gross margin percentage for the 1st quarter fiscal 2012 was 24.6% compared with a gross margin of 24.0% in 1st quarter fiscal 2011 and 19.7% in the 4th quarter of fiscal 2011.
• Cash from operations, before changes in non-cash working capital items, was $1.47 million for the 1st quarter fiscal 2012 compared to 1st quarter fiscal 2011 cash from operations of $868,036.
• A current asset balance of $29.41 million and working capital of $8.62 million.
• Total assets of $45.04 million and total liabilities of $22.52 million.

 "Cabo Drilling's first quarter revenue for fiscal 2012 is the Company's highest ever quarterly revenue," stated Mr. Versfelt, Cabo's President & CEO.  "Quarterly revenue for the period ending September 30, 2011 reached $16.93 million, a 65% increase from the $10.27 million revenue generated in the first quarter of 2011."

"Gross margin increased to 24.6% or $4.16 million during the first quarter, fiscal 2012, compared to 19.7% in the fourth quarter of fiscal 2011 and 24% in the first quarter of fiscal 2011," said Mr. Versfelt.  "This increase has brought our gross margin to the level management is expecting to maintain or improve upon for the balance of 2012."

"EBITDA improved to $3.05 million or $0.04 per share for the quarter ending September 30, 2011 from $1.01 million in the comparable period of fiscal 2011," stated Mr. Versfelt.  "Net income after taxes for the first quarter, fiscal 2012, increased to a Company record of $1.52 million compared to $197,544 for the first quarter ended September 30, 2011."

"During the first quarter of fiscal 2011, Cabo achieved a number of milestones," commented Mr. Versfelt.  "Not only did we record our highest quarterly gross revenue in the history of the Company, but we also achieved our highest net after tax income and EBITDA in Cabo's history.  These milestones are the result of the dedication of our people and initiatives taken during 2010 and early 2011 to position Cabo to increase its gross margin, increase drill utilization and return to profitability."

"As the demand for drilling services remains relatively strong, we will continue to identify growth opportunities in our current markets, as well as identify new market opportunities," stated John A. Versfelt. "It is imperative that we continue to invest our capital in equipment and people now, as they are vital to our ongoing and future success."

First quarter ended September 30, 2011

Cabo Drilling recorded record gross revenues for the three months ending September 30, 2011 of $16.93 million, compared to $10.27 million in the comparable three month period in fiscal 2011. Revenues from the Canadian divisions represented 75% of the revenues for the first quarter of fiscal 2012, as compared to 74% during the fourth quarter of fiscal 2011. 

Direct costs for the three month period ended September 30, 2011 were $12.77 million compared to $7.80 million in the comparable three month period ended September 30, 2010. Gross margins for the three month period ended September 30, 2011 were 24.6%, compared to 24.0% during the quarter ended September 30, 2010 and 19.7% in the fourth quarter of fiscal 2011. The increased margin during the first quarter of fiscal 2011 is a result of the improved margins particularly in the Ontario division, margins that were compromised during the third and fourth quarters of fiscal 2011.

General and administration costs increased to $1.76 million in the quarter ended September 30, 2011 compared to $1.46 million incurred in first quarter of fiscal 2011. However, general and administration expenses decreased compared to the $2.33 million recorded in the fourth quarter of fiscal 2011.

Depreciation of property, plant and equipment for the three months ending September 30, 2011 increased to $651,969 from $592,608 in the fourth quarter of fiscal 2011 and $597,779 incurred during the quarter ended September 30, 2010, as a result of increased capital expenditures in the past six months.

Net income for the first quarter of fiscal 2012 was $1.52 million compared to net income of $197,544 in the first quarter of fiscal 2011 and a net loss of $807,284 in the fourth quarter of fiscal 2011.

The Company's cash (cash and cash equivalents) position at September 30, 2011, is $257,359 compared to $102,723 at June 30, 2011.

Accounts receivable increased by $2.27 million or 21% to $12.86 million at September 30, 2011 from $10.59 million at June 30, 2011. The increase is primarily due to increased activity during the first quarter of fiscal 2012. 

Property, plant & equipment increased by $785,579 at September 30, 2011 to $13.78 million from $12.99 million at June 30, 2011. The Company increased capital equipment by $2.95 million during fiscal 2011, with most of the emphasis on reverse circulation and helicopter support drills. During the first quarter of fiscal 2012, the Company acquired one new drill, financed by an equipment manufacturer, and completed the rebuild of three other drills for long term contracts. 

Cash flow from operations (before changes in non-cash operating working capital items) increased by $602,948 to $1.47 million during the 1st quarter of fiscal 2012, compared $868,036 in the 1st quarter of fiscal 2011.

The mineral drilling industry is dependent on demand for and supply of precious, base and strategic metals as well as precious stones. Demand and supply factors for these commodities can change dramatically up and down, as we have witnessed in the past, causing dynamic shifts in the supply of drills and drilling personnel from under supply to over supply. The recent financial stress in financial credit and equity markets, as well as significant global currency and economic shifts, have caused substantial uncertainty in the global financial markets. While this uncertainty has not caused major changes in the non -ferrous metal markets, the Company remains very vigilante to any substantial market moves that can impact the demand for its services. Management has initiated comprehensive cost and spending controls, as well as risk management procedures throughout the Company. Senior management is focused on careful cash management, reduction of debt, high customer relations and high employee relations.

About Cabo Drilling Corp.  (TSX-V:CBE)
Cabo Drilling Corp. is a drilling services company headquartered in North Vancouver, British Columbia, Canada.  The Company provides mining related and specialty drilling services through its Canadian divisions in Surrey, British Columbia; Montr�al, Quebec; Kirkland Lake, Ontario; and Springdale, Newfoundland; as well as Cabo Drilling (Nevada) Inc. of the United States; Cabo Drilling (Panama) Corp. of Panama, Republic of Panama; Cabo Drilling Panama-Pacifico Corp. of Panama, Republic of Panama doing business as Cabo Drilling Colombia Corp.; Balkan States Drilling SH.P.K. of Tirana, Albania; and Cabo Drilling (International) Inc.  The Company's common shares trade on the Frankfurt Exchange under the symbol: DHL and on the TSX Venture Exchange under the symbol: CBE.

ON BEHALF OF THE BOARD

     "John A. Versfelt"

John A. Versfelt
Chairman, President and CEO

Further information about the Company can be found on the Cabo website (http://www.cabo.ca) and SEDAR (www.sedar.com) or by contacting Sheri Barton, Corporate Communications at 403-217-5830 or Mr. John A. Versfelt, Chairman, President & CEO of the Company at 604-984-8894
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The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.  This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, potential mineral recovery processes and other business transactions timing.  Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties.  Actual results may differ materially from those currently anticipated in such statements.