Financial Data and Key Metrics Changes - Revenues for Q3 2024 were $342 million, with a gross profit of $66 million and net income of $29.5 million, resulting in adjusted EBITDA of $88 million and positive operating cash flow of $56 million, leading to strong free cash flow of $53 million [6][8][13] - Year-to-date revenues reached $1 billion with a gross profit of $161 million and net income of $36 million, while adjusted EBITDA was $232 million, and positive free cash flow was $98 million [8][12] Business Line Data and Key Metrics Changes - The Well Interventions segment showed strong utilization in the North Sea, Gulf of Mexico, Brazil, and Australia, achieving a solid overall uptime efficiency of 99% for the quarter [9][10] - The Robotics segment performed well, operating 6 vessels with high utilization, particularly in renewables-related projects [11][12] - The Shallow Water Abandonment business faced challenges due to hurricanes, leading to lower-than-expected utilization [12][24] Market Data and Key Metrics Changes - The company operates globally with minimal disruption, with operations in Europe, Asia Pacific, Brazil, Africa, the Gulf of Mexico, and the U.S. East Coast [9] - The Gulf of Mexico remains a strong market for Helix, with contracts secured for the Q5000 and Q4000 [19][40] Company Strategy and Development Direction - The company is focusing on long-term contracts with Petrobras and Shell, which provide a strong backlog and improved market rates for 2025 [8][19] - The Robotics segment is expected to benefit from growth in the offshore wind market, while the Shallow Water Abandonment segment is anticipated to rebound in 2025 [24][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position, highlighting strong EBITDA performance despite challenges in the Shallow Water Abandonment segment [24][26] - The company anticipates a $60 million to $100 million increase in EBITDA for well interventions in 2025, driven by new contracts and improved rates [26][57] Other Important Information - The company has a strong liquidity position with cash and cash equivalents of $324 million and total liquidity of $399 million [7][14] - Funded debt stands at $324 million with no significant maturities until 2029, and the company is targeting $20 million to $30 million in share repurchases for 2024 [18][19] Q&A Session Summary Question: Visibility on well intervention improvement for next year - Management indicated that budgeting shows improvement over the current year, with increased bidding activity [30][31] Question: Free cash flow expectations for next year - Management is bullish on free cash flow generation, expecting it to be in the $200 million range, with plans for capital allocation focused on growth and share repurchases [32][34] Question: Impact of hurricanes on revenue - Management confirmed that the $10 million revenue loss in Q3 due to hurricanes will not be recouped in Q4 [35] Question: EBITDA impact from shut-ins - Management expects minimal impact from the Droshky shut-in, while the Thunder Hawk shut-in is estimated to result in a couple of million dollars loss for the quarter [36] Question: ROV market pricing expectations - Management anticipates a tightening market with ROV rates expected to increase by at least 10% next year [66]

Backlog and Demand - As of September 30, 2024, the company's consolidated backlog totaled approximately $1.6 billion, with $261 million expected to be performed over the remainder of 2024[107]. - Approximately 86% of the total backlog is represented by contracts with Shell, ExxonMobil, Trident Energy, Petrobras, and Talos[107]. - The company expects continued strong performance driven by increasing demand for decommissioning services internationally and growth in the offshore renewables trenching market[108]. - The demand for shallow water decommissioning services in the Gulf of Mexico is expected to remain soft in the near term but should grow over the mid- to long-term[108]. - The demand for P&A services is expected to grow over the mid- to long-term due to regulatory pressures and a shift towards renewable energy[105]. Financial Performance - Net income for the three months ended September 30, 2024, was $29,514 thousand, compared to $15,560 thousand for the same period in 2023, representing an increase of 90%[113]. - Adjusted EBITDA for the nine months ended September 30, 2024, was $231,506 thousand, up from $202,771 thousand in the same period of 2023, reflecting a growth of 14.2%[113]. - Free Cash Flow for the nine months ended September 30, 2024, was $97,734 thousand, significantly higher than $41,920 thousand for the same period in 2023, indicating an increase of 132.8%[114]. - Consolidated net revenues for the nine-month period ended September 30, 2024, increased by 5% to $1,003.4 million from $954.6 million in the same period in 2023[130]. - Gross profit for the nine-month period ended September 30, 2024, increased by $9.6 million to $160.7 million compared to $151.1 million in the same period in 2023[136]. Revenue Breakdown - Net revenues for the three months ended September 30, 2024, decreased by 13% to $342,419 thousand from $395,670 thousand in the same period in 2023[117]. - Well Intervention revenues decreased by 19% to $182,667 thousand for the three months ended September 30, 2024, compared to $225,367 thousand in the same period in 2023[116]. - Robotics revenues increased by 12% to $84,526 thousand for the three months ended September 30, 2024, up from $75,646 thousand in the same period in 2023[119]. - Shallow Water Abandonment revenues decreased by 18% to $71,595 thousand for the three months ended September 30, 2024, compared to $87,272 thousand in the same period in 2023[120]. - Production Facilities revenues decreased by 15% to $20,695 thousand for the three months ended September 30, 2024, down from $24,469 thousand in the same period in 2023[121]. Expenses and Cash Flow - Selling, general and administrative expenses decreased to $21.1 million for Q3 2024 from $27.8 million in Q3 2023, primarily due to lower employee compensation costs[126]. - Net interest expense increased to $5.7 million for Q3 2024 compared to $4.2 million in Q3 2023, reflecting higher debt levels and rates[126]. - Operating cash flows for the nine-month period ended September 30, 2024, were $108.1 million, significantly up from $57.7 million in the same period of 2023, driven by higher operating income and lower working capital outflows[149]. - Cash flows used in investing activities decreased to $(10.3) million for the nine-month period ended September 30, 2024, compared to $(15.8) million in the same period of 2023, indicating reduced capital expenditures[148]. - Net cash outflows from financing activities for the nine-month period ended September 30, 2024, were $(105.6) million, primarily due to the retirement of the 2026 Notes and earn-out payments[150]. Debt and Liquidity - Long-term debt, excluding current maturities, was $305.5 million as of September 30, 2024, down from $313.4 million on December 31, 2023[141]. - Liquidity at September 30, 2024, was $398.8 million, down from $431.5 million at December 31, 2023, primarily due to higher letter of credit usage related to the Nigeria project[144]. - The company expects sufficient cash on hand and internally generated cash flows to fund operations and capital spending for at least the next 12 months[145]. Tax and Other Financial Metrics - Income tax provision increased to $22.5 million for the nine-month period ended September 30, 2024, compared to $9.6 million in the same period in 2023, with effective tax rates of 38.8% and 35.5% respectively[139]. - Net other expense decreased to $2.6 million for the nine-month period ended September 30, 2024, down from $10.6 million in the same period in 2023[138]. - The company recorded foreign currency translation gains of $35.3 million for the nine-month period ended September 30, 2024, impacting accumulated other comprehensive loss[160]. Operational Capacity - The company operates a well intervention fleet that includes seven purpose-built vessels and 12 subsea intervention systems, along with 39 work-class ROVs and six trenchers[100]. - The change in fair value of contingent consideration reflects an improvement in Helix Alliance's results during the third quarter 2023, with the final earn-out paid on April 3, 2024[125]. - The company anticipates lower availability under the Amended ABL Facility due to fewer eligible receivables while the Q4000 performs work in Nigeria[145].

分组1 - Helix Energy reported quarterly earnings of $0.19 per share, missing the Zacks Consensus Estimate of $0.21 per share, representing an earnings surprise of -9.52% [1] - The company posted revenues of $342.42 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 3.47%, compared to year-ago revenues of $395.67 million [1] - Over the last four quarters, Helix Energy has surpassed consensus EPS estimates only once and has topped consensus revenue estimates two times [1] 分组2 - Helix Energy shares have declined approximately 5.5% since the beginning of the year, contrasting with the S&P 500's gain of 22.7% [2] - The company's earnings outlook is mixed, with the current consensus EPS estimate for the coming quarter at $0.04 on revenues of $303.11 million, and $0.29 on revenues of $1.32 billion for the current fiscal year [4] - The Zacks Industry Rank for Oil and Gas - Field Services is currently in the bottom 41% of over 250 Zacks industries, indicating potential underperformance compared to higher-ranked industries [5]

Financial Performance - Helix reported net income of $29.5 million, or $0.19 per diluted share, for Q3 2024, a decrease from $32.3 million, or $0.21 per diluted share, in Q2 2024[2]. - Adjusted EBITDA for Q3 2024 was $87.6 million, down from $96.9 million in Q2 2024[2]. - For the nine months ended September 30, 2024, net income was $35.5 million, or $0.23 per diluted share, compared to $17.5 million, or $0.11 per diluted share, for the same period in 2023[3]. - Net revenues for the three months ended September 30, 2024, were $342,419 thousand, a decrease of 13.4% compared to $395,670 thousand for the same period in 2023[25]. - Gross profit for the three months ended September 30, 2024, was $65,665 thousand, down 18.4% from $80,545 thousand in the prior year[25]. - Net income for the three months ended September 30, 2024, was $29,514 thousand, representing an increase of 89.6% compared to $15,560 thousand for the same period in 2023[25]. - Adjusted EBITDA for the three months ended September 30, 2024, was $87,621 thousand, compared to $96,385 thousand in the same period last year, reflecting a decrease of 9.1%[27]. - Free cash flow for the three months ended September 30, 2024, was $52,645 thousand, an increase from $23,366 thousand in the prior year[27]. - The company reported a basic earnings per share of $0.19 for the three months ended September 30, 2024, compared to $0.10 for the same period in 2023, an increase of 90%[25]. Revenue Breakdown - Well Intervention revenues decreased by $42.0 million, or 19%, in Q3 2024 due to increased transit and mobilization days[6]. - Robotics revenues increased by $3.3 million, or 4%, in Q3 2024, attributed to higher vessel, trenching, and ROV activities[8]. - Shallow Water Abandonment revenues increased by $20.8 million, or 41%, in Q3 2024, driven by increased vessel and heavy lift activity[10]. - Shallow Water Abandonment revenues decreased by $15.7 million, or 18%, in Q3 2024 compared to Q3 2023, primarily due to lower vessel and system utilization[11]. - Production Facilities revenues decreased by $4.7 million, or 19%, in Q3 2024 compared to the prior quarter, attributed to lower oil and gas production and prices[12]. Cash Flow and Liquidity - Cash flows from operating activities for Q3 2024 were $55.7 million, compared to $31.6 million in Q2 2024[3]. - Free cash flow for Q3 2024 was $52.6 million, an increase from $23.4 million in Q2 2024[3]. - Operating cash flows were $55.7 million in Q3 2024, a significant increase from $(12.2) million in the prior quarter and $31.6 million in Q3 2023[18]. - Free Cash Flow was $52.6 million in Q3 2024, compared to $(16.2) million in the prior quarter and $23.4 million in Q3 2023, driven by higher operating cash flows[19]. - Cash and cash equivalents totaled $324.1 million as of September 30, 2024, with total liquidity of $398.8 million[19]. - Cash and cash equivalents as of September 30, 2024, were $324,120 thousand, a slight decrease from $332,191 thousand at the end of 2023[26]. Debt and Liabilities - Consolidated long-term debt was $314.7 million on September 30, 2024, resulting in negative Net Debt of $9.4 million[19]. - Long-term debt, including current maturities, was $314,673 thousand as of September 30, 2024, compared to $227,257 thousand in the prior year, indicating an increase of 38.5%[27]. - Current liabilities decreased to $303,219 thousand as of September 30, 2024, down from $448,618 thousand at the end of 2023, a reduction of 32.4%[26]. Operational Metrics - Overall Well Intervention vessel utilization was 97% in Q3 2024, up from 94% in Q2 2024[6]. - Vessel utilization (excluding heavy lift) was 76% in Q3 2024, down from 89% in Q3 2023, while P&A and Coiled Tubing systems utilization declined to 607 days, or 25%[11]. - The company entered into three well intervention contracts, increasing its backlog by over $800 million[4]. Expenses - Selling, general and administrative expenses were $21.1 million, or 6.2% of revenue, in Q3 2024, down from $22.3 million, or 6.1% of revenue, in the prior quarter[14]. - Regulatory certifications for vessels and systems were $8.9 million in Q3 2024, down from $10.7 million in the prior quarter and $17.9 million in Q3 2023[18]. - Other expense, net was $0.0 million in Q3 2024, compared to $0.4 million in the prior quarter, primarily due to a charge related to incentive credits[15]. Assets - Total assets as of September 30, 2024, were $2,661,149 thousand, an increase of 4.1% from $2,556,036 thousand at the end of 2023[26].

Company Overview - Helix Energy (HLX) shares increased by 5.5% to $10.80, following a period of 10.7% loss over the past four weeks, indicating a significant recovery in stock performance [1] - The company specializes in oilfield services, particularly in Well Intervention, which extends the life of existing wells and optimizes production [2] Market Demand and Performance - There is a rising demand for Helix Energy's services in offshore markets, including the U.S. Gulf of Mexico, U.S. East Coast, and Brazil, contributing to the company's growth [2] - Despite favorable commodity pricing, there is a slowdown in drilling activities as upstream players focus on stockholder returns rather than increasing output [2] Earnings Expectations - Helix Energy is projected to report quarterly earnings of $0.21 per share, reflecting a year-over-year increase of 10.5%, while revenues are expected to be $343.74 million, down 13.1% from the previous year [3] - The consensus EPS estimate has been revised 16.7% higher in the last 30 days, indicating a positive trend that may lead to price appreciation [4] Industry Context - Helix Energy operates within the Zacks Oil and Gas - Field Services industry, which includes other companies like Subsea 7 SA (SUBCY), that has also experienced stock fluctuations [4] - Subsea 7's EPS estimate remains unchanged at $0.29, representing a significant year-over-year increase of 163.6% [5]

Petrobras (PBR) , a leading energy company in Brazil, and Helix Energy Solutions Group, Inc. (HLX) , a Houston-based provider of oil and gas equipment and services, signed new three-year charter and service contracts for the Siem Helix 1 and Siem Helix 2 vessels. These advanced, riser-based well-intervention vessels will operate in offshore Brazil, with the contracts valued at approximately $786 million. This move continues the companies' longstanding partnership, ensuring that the energy needs in the Santo ...

Financial Performance - Net revenues for the Well Intervention segment were $224.7 million and $441.1 million for the three- and six-month periods ended June 30, 2024, respectively, compared to $154.2 million and $296.7 million for the same periods in 2023[156] - Income from operations for the Robotics segment was $28.4 million and $33.9 million for the three- and six-month periods ended June 30, 2024, respectively, compared to $17.5 million and $22.6 million for the same periods in 2023[156] - The company's total net revenues were $364.8 million and $661.0 million for the three- and six-month periods ended June 30, 2024, respectively, compared to $308.8 million and $558.9 million for the same periods in 2023[156] - Income before income taxes was $47.0 million and $19.0 million for the three- and six-month periods ended June 30, 2024, respectively, compared to $10.4 million and $3.2 million for the same periods in 2023[156] - Consolidated net revenues for Q2 2024 increased by 18% compared to Q2 2023, driven by higher revenues in Well Intervention, Robotics, and Production Facilities segments[181] - Consolidated net revenues increased by 18% to $661.0 million for the six-month period ended June 30, 2024, compared to $558.9 million in the same period in 2023[192] - Well Intervention segment revenues grew by 49% to $441.1 million, driven by higher activity levels[192][194] - Robotics segment revenues increased by 10% to $131.6 million, reflecting steady growth in demand[192] - Well Intervention segment gross profit surged by 2,073% to $56.8 million, primarily due to higher revenues and increased activity[194] - Shallow Water Abandonment segment reported a gross loss of $8.1 million, compared to a gross profit of $28.5 million in the prior year[195] - Free Cash Flow improved to $45.1 million in 2024, up from $18.6 million in 2023, driven by stronger operating cash flows[208] - Well Intervention segment revenues increased by 46% to $224.7 million in Q2 2024 compared to $154.2 million in Q2 2023[209] - Robotics segment revenues grew by 16% to $81.2 million in Q2 2024 from $70.1 million in Q2 2023, driven by higher chartered vessel days and ROV activities[211] - Production Facilities revenues increased by 10% to $25.4 million in Q2 2024 compared to $23.1 million in Q2 2023, reflecting higher oil and gas production[212] - Gross profit for Well Intervention surged by 382% to $33.6 million in Q2 2024 from $7.0 million in Q2 2023[209] - Robotics gross profit increased by 58% to $30.9 million in Q2 2024 from $19.5 million in Q2 2023[209] - Shallow Water Abandonment gross profit declined by 92% to $1.7 million in Q2 2024 from $21.0 million in Q2 2023[215] Segment Performance - Shallow Water Abandonment revenues decreased by 33% in Q2 2024 compared to Q2 2023, with vessel utilization dropping to 58% from 78%[182] - Robotics gross profit increased by $11.4 million in Q2 2024 compared to Q2 2023, driven by higher revenues and profit margin projects[186] - Production Facilities gross profit increased by $1.2 million in Q2 2024 compared to Q2 2023, primarily due to higher segment revenues[187] - Shallow Water Abandonment segment revenues decreased by 38% to $77.7 million due to lower activity levels and softer Gulf of Mexico shelf market conditions[192][193] - Vessel utilization for Shallow Water Abandonment declined to 49% in 2024 from 68% in 2023, reflecting reduced market activity[193] - Shallow Water Abandonment revenues decreased by 33% to $50.8 million in Q2 2024 from $76.3 million in Q2 2023[209] - Chartered vessel days for Robotics increased to 528 days in Q2 2024 from 435 days in Q2 2023[211] - ROV and trencher utilization rose to 76% in Q2 2024 from 58% in Q2 2023[211] Expenses and Costs - Deferred contract costs totaled $24.1 million as of June 30, 2024, compared to $36.6 million as of December 31, 2023, with amortization of $11.0 million and $31.3 million for the three- and six-month periods ended June 30, 2024, respectively[146] - Share-based compensation related to PSUs was $1.5 million and $2.8 million for the three- and six-month periods ended June 30, 2024, respectively, compared to $1.2 million and $2.4 million for the same periods in 2023[151] - Contributions to defined contribution plans totaled $1.4 million and $2.8 million for the three- and six-month periods ended June 30, 2024, respectively, compared to $1.0 million and $2.1 million for the same periods in 2023[154] - Selling, general, and administrative expenses decreased to $22.3 million in Q2 2024 from $24.0 million in Q2 2023, mainly due to lower employee compensation costs[188] - Net other expense was $0.4 million in Q2 2024, compared to $5.7 million in Q2 2023, which included an $11.7 million foreign currency loss related to the devaluation of the Nigerian naira[189] - Net interest expense increased to $5.9 million in Q2 2024 from $4.2 million in Q2 2023, primarily due to interest on 2029 Notes[217] - Foreign currency translation losses of $6.4 million recorded for the six-month period ended June 30, 2024[242] Backlog and Contracts - Consolidated backlog as of June 30, 2024 totaled approximately $873 million, with $443 million expected to be performed in the remainder of 2024[173] - Contracts with Shell, ExxonMobil, Subsea 7, Trident Energy, Petrobras, and the HP I agreement represented 73% of the total backlog as of June 30, 2024[173] - The company's Robotics segment has vessel charters with expiration dates ranging from 2025 to 2030, including the Grand Canyon II (December 2030) and the Grand Canyon III (May 2028)[159] Long-Term Incentives and Share Issuance - The company's 2005 Long-Term Incentive Plan was amended to authorize 7.0 million additional shares for issuance, with approximately 9.5 million shares available as of June 30, 2024[150] Asset Retirement Obligations - Asset retirement obligations (AROs) increased to $64.2 million as of June 30, 2024, from $61.4 million at the beginning of the year, with accretion expense of $2.8 million for the six-month period[159] Market and Growth Outlook - The company expects strong performance in 2024, driven by international demand for decommissioning services and growth in offshore renewables trenching markets[203] - Mid- to long-term growth is anticipated in shallow water decommissioning services in the Gulf of Mexico, despite near-term softness[203] Adjusted EBITDA and Net Debt - Adjusted EBITDA for Q2 2024 was $96.9 million, up from $71.3 million in Q2 2023[176] - Net debt as of June 30, 2024 was $43.6 million, compared to $29.5 million as of December 31, 2023[178] Market Risks - Exposure to market price risks related to oil and natural gas in offshore production facilities[243]

Financial Performance and Key Metrics - The company generated revenues of $661 million, gross profits of $95 million, and net income of $6 million for the second quarter of 2024, with adjusted EBITDA of $144 million [7][66] - Year-to-date net income increased by $21 million, despite pre-tax losses related to the redemption of convertible notes [7] - Adjusted EBITDA for the quarter was $97 million, with negative operating cash flow of $12 million, resulting in negative free cash flow of $16 million [16][71] Business Segment Performance - The Well Intervention segment achieved strong utilization across the Gulf of Mexico, North Sea, Europe, Brazil, and Australia, with overall uptime efficiency of 98.9% [8][66] - Robotics had an exceptional quarter, operating six vessels with strong utilization, particularly in renewable energy projects [18][66] - The shallow-water abandonment business faced challenges due to a late start to the season and unexpected weather conditions, impacting utilization [68][91] Market Data and Key Metrics - In Brazil, a 40% increase in rates year-over-year is expected going into 2025, with utilization projected to extend into 2028 [12] - The Gulf of Mexico market remains strong, supporting improving rates and expected high utilization for the Q4000 and Q5000 vessels [20][66] - The company anticipates a rebound in demand for shallow water decommissioning in 2025, despite a soft market in 2024 [24][101] Company Strategy and Industry Competition - The company is focused on securing long-term contracts at market rates for its well intervention assets, with expectations of significant EBITDA growth in 2025 [33][103] - The robotics segment is benefiting from a tight market, with strong demand in both oil and gas and renewables [100][104] - The company plans to continue share repurchases and explore bolt-on acquisitions to enhance value creation for shareholders [80] Management Commentary on Operating Environment and Future Outlook - Management expressed optimism about the second half of 2024, expecting it to be on par or slightly stronger than the first half [73] - The company is adjusting its guidance for free cash flow to $90 million to $125 million, reflecting anticipated working capital inflows [71] - Management noted that the shallow water abandonment market is difficult to forecast but believes in a solid long-term foundation due to ongoing customer needs [43][101] Other Important Information - Funded debt stands at $328 million, with cash and cash equivalents of $275 million, resulting in a liquidity position of $370 million [19][95] - The company is targeting $20 million to $30 million in share repurchases for 2024, with $10 million completed year-to-date [19] Q&A Session Summary Question: Can you discuss the typical seasonal cycle for robotics? - Management indicated that ROVs are on longer-term contracts, with trenching being more affected by seasonality, but they expect a strong winter season [30][31] Question: How is the shallow water abandonment business being managed? - Management acknowledged the current soft market but is maintaining capacity to respond to a potential rebound in 2025, incurring additional costs in the process [34][35] Question: What is the outlook for well intervention contracts? - Management is in negotiations for longer-term contracts at higher rates, with expectations to announce details before the end of the year [33][110]

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Q2 2024 Performance Summary](index=1&type=section&id=Q2%202024%20Performance%20Summary) Helix reported a significant turnaround in Q2 2024 with a net income of $32.3 million, compared to a net loss of $26.3 million in Q1 2024 and net income of $7.1 million in Q2 2023, with the Q1 2024 loss impacted by a $20.9 million pre-tax loss from debt retirement, and Adjusted EBITDA more than doubled quarter-over-quarter to $96.9 million, showing strong year-over-year growth Q2 2024 Key Financial Metrics ($ in millions) | Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Net Income (Loss) | $32.3 | $(26.3) | $7.1 | | Diluted EPS | $0.21 | $(0.17) | $0.05 | | Adjusted EBITDA | $96.9 | $47.0 | $71.3 | First Half (H1) 2024 vs 2023 Performance ($ in millions) | Metric | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Net Income | $6.0 | $1.9 | | Diluted EPS | $0.04 | $0.01 | | Adjusted EBITDA | $143.9 | $106.4 | - The net loss in Q1 2024 included a significant pre-tax loss of approximately **$20.9 million**, or **$(0.14)** per diluted share, related to the retirement of Convertible Senior Notes due 2026[3](index=3&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) The CEO highlighted strong Q2 2024 performance driven by seasonal activity increases and improvements across all segments, with a particularly strong showing from the Robotics segment, while acknowledging near-term softness in the Shallow Water Abandonment market, noting that recent financial clean-ups, such as the Alliance earn-out settlement and convertible note retirement, provide a clearer view of the company's performance, with the focus remaining on executing the Energy Transition strategy with expectations for further improvements in 2025 - Performance benefitted from a seasonal pick-up in activity in the North Sea and Gulf of Mexico shelf[22](index=22&type=chunk) - The Robotics segment outperformed with strong results from trenching and renewables operations in the North Sea and Asia Pacific[22](index=22&type=chunk) - The settlement of the Alliance earn-out and retirement of 2026 convertible notes are expected to provide clearer financial results and cash flows going forward[22](index=22&type=chunk) [Segment Performance Analysis](index=3&type=section&id=Segment%20Performance%20Analysis) [Well Intervention](index=3&type=section&id=Well%20Intervention) The Well Intervention segment saw revenue increase 4% quarter-over-quarter to $224.7 million, driven by higher utilization and rates in the North Sea, and year-over-year, revenue surged 46% due to improved utilization and rates in the Gulf of Mexico and higher contributions from the Seawell and Q7000 vessels, with overall vessel utilization standing at 94% for the quarter Well Intervention Performance ($ in thousands) | Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Revenues | $224,679 | $216,459 | $154,221 | | Operating Income | $29,299 | $18,679 | $3,380 | - QoQ revenue growth was driven by higher utilization and rates for the Well Enhancer in the North Sea following its Q1 dry dock, and higher rates in the Gulf of Mexico[5](index=5&type=chunk) - YoY revenue growth was primarily due to higher utilization and rates in the Gulf of Mexico (as Q4000 was in dry dock in Q2 2023) and a full quarter of utilization from the Q7000[12](index=12&type=chunk) - Overall vessel utilization was **94%** in Q2 2024, compared to **90%** in Q1 2024 and **84%** in Q2 2023[5](index=5&type=chunk)[12](index=12&type=chunk) [Robotics](index=3&type=section&id=Robotics) The Robotics segment delivered strong growth, with revenues increasing 61% quarter-over-quarter and 16% year-over-year to $81.2 million, driven by seasonally higher vessel, trenching, and ROV activities, and utilization for ROV and trenchers reached 76%, a significant increase from both the prior quarter and the previous year Robotics Performance ($ in thousands) | Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Revenues | $81,249 | $50,309 | $70,050 | | Operating Income | $28,400 | $5,450 | $17,467 | - QoQ revenue surged **61%** due to seasonally higher activity, with chartered vessel utilization at **97%** and integrated vessel trenching days increasing to **232** from **85** in Q1[25](index=25&type=chunk) - YoY revenue grew **16%** due to higher chartered vessel days, trenching, and ROV activities[13](index=13&type=chunk) - ROV and trencher utilization increased to **76%** in Q2 2024, up from **58%** in both Q1 2024 and Q2 2023[13](index=13&type=chunk)[25](index=25&type=chunk) [Shallow Water Abandonment](index=5&type=section&id=Shallow%20Water%20Abandonment) This segment's performance reflected market softness, with revenues increasing 89% quarter-over-quarter to $50.8 million due to seasonal activity, but falling 33% year-over-year, attributed to lower activity and a softer Gulf of Mexico shelf market, leading to a significant drop in operating income from $19.8 million in Q2 2023 to a loss of $0.3 million in Q2 2024 Shallow Water Abandonment Performance ($ in thousands) | Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Revenues | $50,841 | $26,853 | $76,306 | | Operating Income (Loss) | $(281) | $(12,428) | $19,762 | - YoY revenue decreased **33%** due to lower activity levels and a softer Gulf of Mexico shelf market, with overall vessel utilization dropping to **58%** from **78%** in Q2 2023[14](index=14&type=chunk) - QoQ revenue increased **89%** reflecting seasonally higher activity levels on the Gulf of Mexico shelf, with vessel utilization up from **41%** in Q1 2024[26](index=26&type=chunk) [Production Facilities](index=5&type=section&id=Production%20Facilities) The Production Facilities segment's revenue grew 5% quarter-over-quarter and 10% year-over-year to $25.4 million, swinging to an operating income of $9.1 million from a loss of $1.5 million in the prior quarter, primarily because Q1 was impacted by $8.6 million in workover costs Production Facilities Performance ($ in thousands) | Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Revenues | $25,400 | $24,152 | $23,128 | | Operating Income (Loss) | $9,097 | $(1,543) | $7,774 | - The significant QoQ improvement in operating income was mainly due to the absence of approximately **$8.6 million** in workover costs incurred on the Thunder Hawk wells during Q1 2024[19](index=19&type=chunk) - YoY revenue increased **10%** due to higher oil and gas production, as both fields had been shut-in for maintenance during parts of Q2 2023[27](index=27&type=chunk) [Other Financial Details](index=5&type=section&id=Other%20Financial%20Details) [Selling, General and Administrative (SG&A)](index=5&type=section&id=Selling%2C%20General%20and%20Administrative%20%28SG%26A%29) SG&A expenses were $22.3 million in Q2 2024, a slight increase from $21.0 million in the prior quarter due to higher compensation costs, and as a percentage of revenue, SG&A improved to 6.1% from 7.0% in Q1 2024 SG&A Expenses ($ in millions) | Metric | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | SG&A Expense | $22.3 | $21.0 | | SG&A as % of Revenue | 6.1% | 7.0% | [Other Income and Expenses](index=5&type=section&id=Other%20Income%20and%20Expenses) Other expense, net, was $0.4 million in Q2 2024, a significant decrease from $2.2 million in Q1 2024, with the prior quarter's expense primarily driven by foreign currency losses related to the depreciation of the British pound, which had an inconsequential impact in the current quarter - Other expense, net was **$0.4 million** in Q2 2024, down from **$2.2 million** in Q1 2024[6](index=6&type=chunk) - The higher expense in Q1 2024 was mainly due to foreign currency losses from the depreciation of the British pound against the U.S. dollar[6](index=6&type=chunk) [Share Repurchases](index=5&type=section&id=Share%20Repurchases) During the second quarter of 2024, the company repurchased approximately 0.5 million shares of its stock for a total of $5.2 million - The company repurchased **0.5 million** shares for **$5.2 million** in Q2 2024[28](index=28&type=chunk) [Financial Condition and Liquidity](index=7&type=section&id=Financial%20Condition%20and%20Liquidity) [Cash Flow Analysis](index=7&type=section&id=Cash%20Flow%20Analysis) Operating cash flow was an outflow of $12.2 million in Q2 2024, heavily impacted by a $58.3 million Alliance earn-out payment, compared to an inflow of $64.5 million in Q1 2024, consequently, Free Cash Flow was negative at $16.2 million for the quarter, with capital expenditures remaining low at $4.0 million Cash Flow Summary ($ in millions) | Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Operating Cash Flow | $(12.2) | $64.5 | $31.5 | | Capital Expenditures | $4.0 | $3.6 | $1.3 | | Free Cash Flow | $(16.2) | $61.2 | $30.2 | - Q2 2024 operating cash flow included a **$58.3 million** payment for the Alliance earn-out[16](index=16&type=chunk) [Liquidity and Debt Position](index=7&type=section&id=Liquidity%20and%20Debt%20Position) As of June 30, 2024, Helix maintained a solid liquidity position of $370.1 million, consisting of $275.1 million in cash and $95.1 million available under its ABL facility, with consolidated long-term debt standing at $318.6 million, resulting in a Net Debt of $43.6 million Liquidity and Debt as of June 30, 2024 ($ in millions) | Metric | Amount | | :--- | :--- | | Cash and cash equivalents | $275.1 | | ABL Facility Capacity | $95.1 | | **Total Liquidity** | **$370.1** | | Long-term Debt | $318.6 | | **Net Debt** | **$43.6** | [Consolidated Financial Statements](index=9&type=section&id=Consolidated%20Financial%20Statements) [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the second quarter of 2024, the company reported total revenues of $364.8 million, leading to a gross profit of $75.5 million, and after accounting for all operating and non-operating expenses, including a $14.7 million tax provision, net income was $32.3 million, or $0.21 per diluted share Q2 2024 Statement of Operations Highlights ($ in thousands) | Line Item | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | Net revenues | $364,797 | $308,817 | | Gross profit | $75,486 | $55,349 | | Income from operations | $53,193 | $20,205 | | Net income | $32,289 | $7,100 | | Diluted EPS | $0.21 | $0.05 | [Comparative Condensed Consolidated Balance Sheets](index=10&type=section&id=Comparative%20Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2024, Helix had total assets of $2.60 billion, compared to $2.56 billion at year-end 2023, with total liabilities standing at $1.10 billion, and shareholders' equity at $1.50 billion, while cash and cash equivalents decreased to $275.1 million from $332.2 million at the end of 2023 Balance Sheet Highlights ($ in thousands) | Line Item | June 30, 2024 | Dec. 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $275,066 | $332,191 | | Total Current Assets | $623,915 | $697,841 | | Total Assets | $2,596,937 | $2,556,036 | | Total Current Liabilities | $300,174 | $448,618 | | Total Liabilities | $1,100,149 | $1,054,036 | | Shareholders' equity | $1,496,788 | $1,501,000 | [Non-GAAP Financial Measures](index=8&type=section&id=Non-GAAP%20Financial%20Measures) [Reconciliation of Non-GAAP Measures](index=8&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) The company uses non-GAAP measures like Adjusted EBITDA, Free Cash Flow, and Net Debt for performance evaluation, and for Q2 2024, Net Income of $32.3 million was reconciled to Adjusted EBITDA of $96.9 million by adjusting for taxes, interest, D&A, and other items, with Free Cash Flow calculated as $(16.2) million from operating cash flows of $(12.2) million less capital expenditures, and Net Debt confirmed at $43.6 million - Management uses EBITDA, Adjusted EBITDA, Free Cash Flow, and Net Debt to monitor performance, compare with industry peers, and for strategic planning[34](index=34&type=chunk)[48](index=48&type=chunk) Q2 2024 Reconciliation of Net Income to Adjusted EBITDA ($ in thousands) | Line Item | Amount | | :--- | :--- | | Net income | $32,289 | | Income tax provision | $14,725 | | Net interest expense | $5,891 | | Other expense, net | $382 | | Depreciation and amortization | $43,471 | | **EBITDA** | **$96,758** | | Other adjustments | $137 | | **Adjusted EBITDA** | **$96,895** | Q2 2024 Free Cash Flow & Net Debt Calculation ($ in thousands) | Metric | Calculation | Result | | :--- | :--- | :--- | | **Free Cash Flow** | | **$(16,153)** | | Cash flows from operating activities | | $(12,164) | | Less: Capital expenditures, net | | $(3,989) | | **Net Debt** | | **$43,563** | | Long-term debt | | $318,629 | | Less: Cash and cash equivalents | | $(275,066) |

Oil prices dropped like a rock this week and that hit oil-related stocks hard. Ironically, it was OPEC+ extending production cuts that sent oil lower, which seems a little backward. You can see the change in Brent crude's price below, which is what pushed energy stocks lower. And the oil production and service companies are leveraged plays on oil, so it's no surprise they were heavily impacted. A cut in production, although already in place, should push a commodity like oil higher, but it was the economic w ...