Tidewater (NYSE: TDW) Acquisition of Wilson Sons Ultratug Offshore - Key Points Summary Company and Industry Overview - **Company**: Tidewater Inc. (NYSE: TDW) - **Acquisition Target**: Wilson Sons Ultratug Offshore - **Industry**: Offshore Supply Vessel (OSV) market, particularly focused on the Brazilian market Core Points and Arguments 1. **Acquisition Announcement**: Tidewater has entered into a definitive agreement to acquire Wilson Sons Ultratug Offshore for **$500 million** in an all-cash transaction [4][12] 2. **Fleet Expansion**: The acquisition will increase Tidewater's fleet in Brazil from **6 vessels to 28 vessels**, significantly enhancing its presence in the world's largest offshore supply vessel market [5][8] 3. **Regulatory Advantages**: The vessels acquired come with regulatory protections under Brazilian law, providing a competitive edge over foreign vessels in local operations [6][10] 4. **Financial Metrics**: The Wilson Sons business is expected to generate approximately **$220 million** in revenue with a gross margin of about **58%** over the first 12 months post-acquisition [14] 5. **Debt Structure**: The acquisition includes the assumption of approximately **$261 million** of debt with a weighted average cost of **3.6%**, which is considered attractive for the overall transaction economics [12][13] 6. **Market Outlook**: There is a strong long-term growth outlook for the Brazilian market, supported by Petrobras' five-year plan and increasing demand from other operators [9][10][20] 7. **Operational Synergies**: While no significant G&A synergies are expected immediately, there is potential for revenue synergies through the REB capacity that the Wilson fleet provides [36][56] Additional Important Insights 1. **Market Demand**: The Brazilian market is currently short on vessels, with only **20%** of vessels working in Brazil being international-flagged, indicating a strong demand for Brazilian-flagged vessels [10] 2. **Fleet Quality**: The Wilson fleet is noted for its consistent build quality and operational efficiency, which is expected to streamline supply chain management and technical planning [9][42] 3. **Future Opportunities**: Tidewater is exploring potential expansion opportunities beyond Brazil, particularly in West Africa, while also considering share repurchases if no suitable acquisitions are found [31][48] 4. **Maintenance and CapEx**: The fleet is in good condition, with 21 of the 22 vessels currently working, and future CapEx and maintenance schedules will be evaluated as the fleet integrates into Tidewater's operations [38][44] This summary encapsulates the key points from the conference call regarding Tidewater's acquisition of Wilson Sons Ultratug Offshore, highlighting the strategic importance of the deal and the anticipated benefits for Tidewater in the Brazilian offshore supply vessel market.

Wilson Sons UltraTug Offshore Acquisition Investor Presentation February 22, 2026 tdw.com Forward-looking Statements In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the Company notes that certain statements set forth in this communication are forward-looking statements which reflect our current view with respect to future events and future financial performance. Forward-looking statements are all statements other than statements of historical fact, incl ...

Financial Data and Key Metrics Changes - Revenue for the second quarter of 2025 was $341.4 million, a 2% increase from $333.4 million in the first quarter [35] - Gross margin was 50.1%, marking the third consecutive quarter above 50% [9][36] - Free cash flow generated was $98 million, the second highest since the offshore recovery began [9][44] Business Line Data and Key Metrics Changes - Average day rates increased to $23,166, a 4% rise compared to the first quarter [36] - Day rates in the Europe and Mediterranean regions improved by 14%, while the Americas saw a nearly 3% increase [41] - Africa experienced a 5% decrease in day rates quarter over quarter [41] Market Data and Key Metrics Changes - The Americas region reported a 28% increase in revenue compared to the first quarter, while Europe and Mediterranean regions saw a 27% increase [41] - The Africa region's revenue decreased by 22% compared to Q1 [41] - The overall gross margin in the Americas increased by 14 percentage points, while Europe and Mediterranean increased by 10 percentage points [41] Company Strategy and Development Direction - The company announced a $500 million share repurchase program, representing over 20% of its market capitalization [10][22] - The focus remains on pursuing M&A opportunities while balancing share repurchases [12][22] - The company is optimistic about the offshore vessel market, expecting a rebound in drilling activity in 2026 [13][15] Management's Comments on Operating Environment and Future Outlook - Management noted that the near-term outlook appears softer than previously expected, but remains confident in long-term fundamentals [14][17] - The company anticipates a sequential decline in Q3 revenue by about 4% but expects utilization to improve in the latter half of the year [25][26] - Management expressed confidence in achieving full-year financial guidance despite near-term uncertainties [48] Other Important Information - The company successfully refinanced $650 million in unsecured bonds, enhancing financial flexibility [10][19] - The new debt structure allows for unlimited shareholder returns as long as leverage metrics are met [20][21] - The company is monitoring a significant accounts receivable balance from a primary customer in Mexico, which represents approximately 14% of total trade AR [44] Q&A Session Summary Question: Update on M&A opportunities - Management noted that discussions have become more constructive, with a growing awareness of market volatility, making transactions more feasible [51][66] Question: Outlook for drilling demand in 2026 - Management expressed optimism about increased drilling contracts and a positive outlook for the second half of 2026, with expectations for production, subsea construction, and drilling to all be active simultaneously [56][59] Question: Changes in second half expectations - Management acknowledged that second half expectations have come down slightly compared to previous guidance, particularly regarding utilization improvements [74] Question: Utilization improvement range for Q3 - Management indicated a few percentage points of utilization improvement is expected from Q2 to Q3 [80][82] Question: Factors driving lower rate outlook for Q3 - Management attributed the expected lower rates to softening in the North Sea and West Africa, along with the absence of favorable foreign exchange rates [87]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $333.4 million, a decrease of approximately 3% from $345.1 million in Q4 2024 [33] - Gross margin was 50.1%, slightly down from 50.4% in Q4 2024, marking two consecutive quarters above 50% [34] - Free cash flow generated was about $94.7 million, down from $107 million in Q4 2024 [40] - Net income for the quarter was $42.7 million, or $0.83 per share [33] Business Line Data and Key Metrics Changes - Average day rates increased to $22,303, up from the previous quarter [34] - Active utilization improved from 77.7% in Q4 2024 to 78.4% in Q1 2025 [34] - Day rates in the Americas improved by 8% and in the Middle East by almost 5% [38] Market Data and Key Metrics Changes - The Brazilian OSV market has strengthened significantly, while the U.K. North Sea and Mexico markets face demand-side challenges [24][26] - The Middle East, Africa, and Southeast Asia have seen steady improvements in demand [24] - The overall OSV market remains above historical averages despite economic uncertainties [25] Company Strategy and Development Direction - The company views share repurchase programs as a mechanism to return capital to shareholders and take advantage of market inefficiencies [9] - M&A remains a cornerstone of growth strategy, with a focus on unlevered returns and near-term free cash flow generation [10] - The company is optimistic about the long-term fundamentals of the offshore industry despite current economic uncertainties [45] Management's Comments on Operating Environment and Future Outlook - Management noted that the uncertainty regarding global growth is high, but they are familiar with navigating such situations [12] - The outlook for 2025 aligns with prior expectations, with signs of strength in intermediate to long-term plans for customers [14] - Management remains cautious but optimistic about the potential for increased offshore activity in 2026 and beyond [14] Other Important Information - The company has no immediate need to refinance existing debt due to low leverage and no near-term maturities [19] - The company is actively monitoring the debt capital markets for potential refinancing opportunities [19] - The company expects to incur approximately $113 million in drydock costs for the year [41] Q&A Session Summary Question: What is the outlook for offshore activity in 2026 and 2027? - Management indicated that conversations with customers remain positive, with no changes to plans observed [51][53] Question: How does the company expect to benefit from assets moving out of the North Sea? - Management expects to benefit from tightening supply in the North Sea due to vessels moving to Brazil [57] Question: What is the guidance for Q2 revenue and margins? - Guidance for Q2 indicates a revenue decline of about 5% sequentially with gross margins expected at 44% [90] Question: How does the company decide whether to stack a vessel? - The decision involves various factors including rate thresholds, visibility metrics, and region-specific considerations [87] Question: What is the timeline for tenders? - The timeline for tenders varies by customer, with some taking three to six months to finalize [93]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $333.4 million, a decrease of approximately 3% from $345.1 million in Q4 2024 [32] - Net income for the quarter was $42.7 million, or $0.83 per share [32] - Average day rates increased to $22,303, slightly higher than the previous quarter [33] - Active utilization improved from 77.7% in Q4 2024 to 78.4% in Q1 2025 [33] - Gross margin was 50.1%, compared to 50.4% in Q4 2024, marking two consecutive quarters above 50% [33] Business Line Data and Key Metrics Changes - Day rates in the Americas improved by 8% and in the Middle East by almost 5% [37] - The Europe and Mediterranean region saw a decrease of about 4% in day rates due to seasonality [37] - Gross margin increased in the APAC and Middle East regions, while it decreased in Africa and Europe [37] Market Data and Key Metrics Changes - The Brazilian OSV market has strengthened significantly, while the U.K. North Sea and Mexico markets face demand-side challenges [23][25] - The Middle East and Africa markets showed steady improvements, with strong Q1 performance in Africa [27][28] - The overall OSV market remains above historical averages, although diverging trends are noted across regions [23] Company Strategy and Development Direction - The company views share repurchase programs as a mechanism to return capital to shareholders and take advantage of market inefficiencies [8][10] - M&A remains a cornerstone of growth strategy, with a focus on unlevered returns and near-term free cash flow generation [10] - The company is optimistic about the long-term fundamentals of the offshore market despite current macroeconomic uncertainties [45] Management's Comments on Operating Environment and Future Outlook - Management noted that the uncertainty regarding global growth is high, but they are familiar with navigating such situations [12] - There have been no canceled or delayed projects, indicating continued customer conviction [13] - The company expects 2025 to align with prior expectations, with opportunities in subsea construction and production-related activities [14] Other Important Information - The company generated approximately $95 million in free cash flow, the second highest since the offshore recovery began [8] - The company incurred $43.3 million in deferred drydock costs, significantly higher than the previous quarter [41] - The company has not observed any supplier price increases related to tariffs but is monitoring the situation closely [43] Q&A Session Summary Question: Outlook for offshore drilling contractors and subsea contractors - Management indicated that there have been no changes in customer outlook and expectations remain positive for 2026 and 2027 [50][54] Question: Participation in asset movement from North Sea to Brazil - Management expects to benefit from the movement of vessels to Brazil, which will tighten supply in the North Sea [58] Question: Forward margin guidance for Q2 - Management confirmed that Q2 revenue is expected to decline by about 5% sequentially, with margins at 44% [91] Question: Decision-making framework for stacking vessels - The decision to stack vessels is based on rate thresholds, visibility metrics, and region-specific factors [88] Question: Timeline for tenders - Tender timelines vary by customer, with some taking up to a year from issuance to execution [96]