Tidewater Inc. Stock Price: Quote, Forecast, Splits & News (TDW)

Perplexity Finance

TDW

Tidewater Inc.

TDW

Overview

Financials

Historical Data

$48.26

+$0.04

0.08%

At close: Jun 13, 4:00:02 PM EDT

$48.51

+$0.25

0.52%

After hours: 5:50:52 AM EDT

Change

+$0.04

0.08%

Financial Profile

Prev Close

$48.22

Market Cap

$2.39B

Day Range

$47.66 - $50.09

Open

$49.09

P/E Ratio

14.5

52W Range

$31.17 - $108.44

24H Volume

$37.66M

Dividend Yield

0.00%

EPS

3.34

Key Issues

Recent Transcripts

Q1 revenue and margins exceeded expectations; 2025 guidance reiterated with strong cash flow and buybacks.

Tidewater's 2024 revenue rose 33%, with strong cash flow, buybacks, and positive 2025 outlook.

Financial information provided by Financial Modeling Prep. Options data provided by Unusual Whales. Live transcripts provided by Quartr. Reported revenue and EPS data from Earnings powered by FinChat.io. All data is provided for informational purposes only, and is not intended for trading purposes or financial, investment, tax, legal, accounting or other advice.

Market Cap: $2.4B
IPO Date: 3/17/80
CEO: Mr. Quintin V. Kneen CPA
Fulltime Employees: 7.7K
Sector: Energy
Industry: Oil & Gas Equipment & Services
Country: US
Exchange: New York Stock Exchange

Peers

$0.00

Watchlist

$0.00

Perplexity Finance

TDW

Tidewater Inc.

TDW

Overview

Financials

Historical Data

$48.26

+$0.04

0.08%

At close: Jun 13, 4:00:02 PM EDT

$48.51

+$0.25

0.52%

After hours: 5:50:52 AM EDT

Change

+$0.04

0.08%

Financial Profile

Prev Close

$48.22

Market Cap

$2.39B

Day Range

$47.66 - $50.09

Open

$49.09

P/E Ratio

14.5

52W Range

$31.17 - $108.44

24H Volume

$37.66M

Dividend Yield

0.00%

EPS

3.34

Key Issues

Earnings

Report Date

May 5, 2025

Reported Revenue

333.4M

Beat +0.54%

Avg 1d Change

7.05%

Report Period

Q1 2025

Reported EPS

0.83

Beat +69.39%

Implied Move 1d

10.68%

Transcript

10m 22s

Thank you, Janice. Good morning, everyone, and welcome to Tidewater's first quarter twenty twenty five earnings conference call. I'm joined on the call this morning by our President and CEO, Quentin Neen our Chief Financial Officer, Sam Rubio our Chief Commercial Officer, Piers Middleton. During today's call, we'll make certain statements that are forward looking and referring to our plans and expectations. The risks and uncertainties and other factors that may cause the company's actual performance to be materially different from that stated or by any comment that we're making during today's conference call. Please refer to our most recent Form 10 ks and Form 10 Q for additional details on these factors. These documents are available on our website at tdw.com. Through the SEC at sec.gov. Information presented on this call speaks only as of today, 05/06/2025. Therefore, you're advised that any time sensitive information may no longer be accurate time of any replay. Also during the call, we'll present both GAAP and non GAAP financial measures. A reconciliation of GAAP to non GAAP financial measures can be found in our earnings release located on our website at tdw.com. And now with that, I'll turn the call over to Quinn.

11m 30s

Thank you, West. Good morning, everyone, and welcome to Tidewater's First Quarter twenty twenty five Earnings Conference Call. As usual, I'd like to discuss some highlights of the first quarter. Provide an update on the execution of our share repurchase program and our views on capital allocation. Discuss the state of the offshore vessel market in the midst of the tariff and macroeconomic uncertainty and lastly, provide an update on the state of vessel supply. Wes will then provide some commentary on our capital structure and financial outlook Piers will give an overview of the global market. And Sam will discuss our consolidated financial results. First quarter revenue and gross margin nicely exceeded our Revenue came in at $333,400,000 due to both a higher average day rate and better utilization. Gross margin came in at over 50% for the second consecutive quarter. Day rates outperformed our expectations by more than $500 per day, setting a new quarterly day rate record at 22,303. We experienced lower than anticipated downfall repair days, which has the benefit of increasing utilization, lowering repair and maintenance expenses, reducing fuel expenses related to off hire time. The sequential day rate and utilization improvements in quarter were an encouraging start to the year, especially given that the quarter was disadvantaged by being our largest TriDoc quarter of the year and the fact that from a calendar year seasonality perspective, the first quarter is typically characterized as the slowest quarter of the year.

13m 11s

Additionally, during the first quarter, we generated about $95,000,000 of free cash flow. The second highest quarterly free cash flow figure since the offshore recovery began. Down slightly from the fourth quarter even though during the first quarter we incurred more than $30,000,000 of additional drydock and capital expenditures than we did in the fourth quarter. As we've discussed in prior calls, our view on share repurchase program as we view our share repurchase program as a nice mechanism to return capital to shareholders. But also as a mechanism to take advantage of inefficiencies we see in the market. Particularly to the extent that compelling M and A opportunities are not viable or actionable. During the first quarter and the beginning of the second quarter, amidst broader market volatility, we leaned heavily into the share repurchase program fully utilizing the $90,000,000 of share repurchase activity available to us under our existing debt agreements repurchasing 2,300,000.0 shares on the open market at an average price of $39.31 per share. In addition, we further reduced the outstanding share count by 180,000 shares in exchange for paying $7,500,000 of employee taxes on the vesting of equity compensation at an average price of $41.55 per share.

14m 32s

Bringing the total use of cash to reduce the outstanding share count to nearly 100,000,000 or 2,500,000 shares. Given our long term outlook for the offshore activity and our associated view on the intrinsic value of our shares, we view the recent buyback activity as particularly opportunistic. M and A remains a cornerstone of our growth strategy. However, the broader market volatility and shifting sentiment on offshore activity continues to challenge deal dynamics. The strength and durability of any acquired cash flows and the resulting consolidated capital structure are important to our view of a transaction, although our focus remains on unlevered overall returns and near term free cash flow generation. And to the extent that we find targets that satisfy these conditions, we remain interested in aggressively pursuing them. We will evaluate a deal using stock, cash or a combination of both although using shares would need to satisfy our long term view of our shares' intrinsic value. We will contemplate additional balance sheet leverage for the Wright acquisition, providing the ability to quickly delever back to a reasonable level. As we have done in our prior transactions. Shifting gears a bit, I'd like to discuss recent macro macroeconomic events and how they influence our business and the markets.

15m 49s

We are all watching in real time how the recently announced U. Led tariff regime will ultimately shape trading patterns globally. Its subsequent impact on the global economy and the resulting impact on global energy needs which is ultimately what drives our customers' investment plans. Difficult to say how these factors will play out, it's easy to say the uncertainty about the magnitude and direction of global growth is high. But the good news is that we, along with a broader industry, are familiar with how to navigate situations like this. The benefit of maintaining a relatively low leverage profile and a highly scalable global operating footprint is that it provides some flexibility to react quickly to optimize the business. Reacting quickly requires optimizing the fleet by relocating, withholding or disposing of vessel capacity. The investments we've made in our scalable shore based infrastructure ensure that we run the business as efficiently as possible. Our geographic diversification ensures that we are able to redistribute the fleet to focus on those geographic areas that look to be relatively more attractive. A recount of these factors not to suggest that these are acquired today or that activity is structurally declining. And in fact, it's quite the opposite.

17m 2s

To date, we've learned of no canceled or delayed projects and continue to see signs of strength for the intermediate to long term plans for our customers via long term contracts for offshore drilling units perhaps the most tangible evidence of continued conviction by our customers. I simply mentioned it as a reminder that through the cycles of the past decades, we have fundamentally changed how we run the business, focused on efficiency, free cash flow generation, financial and operational flexibility and geographic diversification. 2025 looks to be in line with our prior expectations with pockets of driller inactivity offset by increases in subsea construction and production related activity offering opportunities to deploy our vessels. Recent contract awards for offshore drilling and tendering activity for our vessels provide for cautious optimism that as we progress into 2026, offshore activity will return to a point that demand will outpace the supply of vessels and provide us the opportunity to resume our aggressive aggressive push on day rates. We anticipate that we will continue to see more rig and vessel tenders as we progress through the summer and into the fall. Further supporting the intermediate term outlook. Encouragingly, the pipeline of Subsea projects and FPSOs deliveries remains robust, and provides for an alternative source of demand in addition to the anticipated incremental drilling activity.

18m 26s

The vessel supply outlook remains essentially unchanged from the prior quarter. Although the general feeling for potential new builds has waned. As a reminder, as change under 3% of the global supply is on order, most of which were placed back in the latter half of twenty twenty four. Our view is that newbuild discussions have largely ceased. The modest number of newbuilds on order are now expected to deliver until late twenty twenty six at the earliest likely into 2027. And I'd likely won't sufficiently replace vessels that are expected to attrition during that same timeframe. Resulting in a continued decrease in net vessel supply and supportive of our expectation that demand will outpace supply in the intermediate term. We watch newbuild activity very closely, and we'll continue to do so, but remain of the view that current shipyard capacity prevailing global day rates and contract terms, the state of the financing markets and vessel technology considerations may any large scale new building programs unlikely. In summary, we're pleased with a nice start to the year and expect 2025 to out largely as anticipated with optimism on longer term offshore activity continuing to support the fundamentals for our business.

19m 41s

And with that, let me turn the call back over to Wes for additional commentary and our financial outlook. Thank you, Clinton.

19m 49s

During the first quarter of twenty twenty five and subsequently through the April, we deployed just north of $97,000,000 to reduce the outstanding share count by approximately 2,500,000 shares, at an average price of $39.47 including both open market repurchases and an exchange for paying employee tax on the vesting of equity compensation. As we've discussed in prior earnings calls, our two outstanding nor bonds contain the operative language providing for for distributions to shareholders, namely share repurchases. We completed our latest share repurchase authorization of $90,000,000 Given the terms of the indentures, specifically the limit limitation on shareholder distributions to 50% of trailing four quarter net income, As of today, we have no incremental allowance provided and therefore have no incremental allowance under the bonds or Board share repurchase authorization to announce. Our future allowance under the bonds will be determined by the trailing four quarter net income measure or through a refinancing of our existing bonds into a new debt structure that could contain different shareholder return provisions. On that note, we continue to actively monitor the debt capital markets and bank markets to successfully achieve our goal of establishing a long term unsecured debt capital structure. Along with a sizable revolving credit facility.

21m 6s

We remain opportunistic on pursuing a potential refinancing we have no near term maturities and no immediate need to access the debt in capital markets. The make whole in our unsecured Nordic bonds which we previously described as one of the primary considerations around the timing of a refinancing, will step down to the first call price in July of twenty twenty five. As we approach July, we are mindful of the economic impact reaching the first call date. Further, while we still view a debt capital structure reset as an important step on the continued evolution of the business, it is equally important that to the extent we do access the markets to establish long term debt capital structure, that it's an economically and structurally attractive solution for our long term vision. As such, with no impending maturities and relatively low leverage, we will remain opportunistic in our approach to a debt capital structure reset. Turning to our leading edge dayrates by vessel class, which were posted in our investor materials yesterday.

22m 5s

For our largest class of PSVs and anchor handlers, we saw some limited downward pressure on our leading edge day rates. As the majority of contracts entered into during the first quarter for these classes of vessels were done in North Sea. The first quarter is typically characterized as the quarter as the least favorable quarter of the year due to seasonality which is especially pronounced in North Sea. We did see sequential improvement in our mid sized and smalls classes of PSVs that entered into contracts throughout the rest of our operating regions. Looking to 2025, we are reiterating our full year revenue guidance of 1.32 to $1,380,000,000 and a full year gross margin range of 48% to 50%. We anticipate second quarter revenue to be about the same as we did last quarter but given the revenue outperformance in the first quarter, we anticipate revenue decline about 5% sequentially. We anticipate a Q2 gross margin of 44%. The sequential decline is due to the fall through on lower revenue as well as higher costs associated with fuel expense related to idle days and vessels down for repair as well as the repair and maintenance expense associated with vessels down for repair.

23m 14s

As we progress into the back half of the year, we anticipate a material uplift in utilization in the third quarter and further modest strengthening into the fourth quarter.

23m 24s

We expect margins to improve in the back half of the year due to fall through from higher levels of revenue, and through a reduction in operating expenses as drydocks declined and a normalization of expenses associated with vessels down for repair. The midpoint of our revenue guidance range is approximately 88% supported by first quarter revenue plus firm backlog and options for the remainder of the year. Our firm backlog and options represent $848,000,000 of revenue for the remainder of 2025. Approximately 70% of available days are captured in firm backlog and options with our larger classes of vessels retaining slightly more availability to incremental work as compared to our smaller vessel classes. The bigger risk to our backlog revenue is unanticipated downtime due to unplanned maintenance incremental time spent on dry docks. With that, I'll turn the call over to Pearce for an overview of the commercial landscape. Thank you, West, and good morning, everyone. The outlook for offshore markets has become increasingly uncertain, amid the fast changing macroeconomic environment in response to recent developments. However, day rates in the broader offshore market generally remain a strong position versus long term averages. And in particular, OSV markets remain above historical averages, although we are starting to see a further exacerbation of diverging trends between some of the regions in which we operate.

24m 46s

In short, the Brazilian OSV market has strengthened significantly in recent months, and The Middle East Africa and Southeast Asia have seen steady improvements. However, The UK, North Sea and Mexico markets continue to face demand side challenges. Overall, the outlook for the OSV market has become more complex. Amidst the increasingly uncertain economic backdrop and volatile energy prices. But the long term fundamentals we have spoken about on previous calls remain in the boat owners' favor going forward And as Quintin mentioned earlier, have not seen any of our customers canceling or deferring any projects. In The Americas, we saw varying degrees of puts and takes during the quarter, On the negative side, Pemex still appears to be in disarray, little clear guidance from the Mexican government on their long term plans for Pemex. Which has meant that in the short term, we don't expect to see any additional demand coming from Pemex for the remainder of the year. On the other hand, the opposite is true in Brazil, where Petrobras is released another long term tender for up to 18 large OSVs, split between foreign and Brazilian flag. With the expectation that a number of POCs working in both The U. K. And Norwegian North Sea will be bid into Brazil.

25m 59s

Which in turn should help tighten supply in the North Sea going forward. Also in the plus column for additional OSB demand, we've seen several recent announcements and tendering related to future development projects in Suriname and Guyana expecting to kick off during 2026. Areas in the North Sea have yet to see improvements in 2020 with PSC rates remaining flat which is not unexpected as Q1 is generally the slowest quarter in the North Sea. And whilst rates are flat, they're still above where rates were in the last up cycle of 2010 to 2014. As mentioned earlier, we do also expect to see some PSCs leaving the North Sea market for Brazil to during 2025 and 2026. And as such, this will tighten the supply demand balance further the boat owners' favor over the upcoming quarters. Africa, we had a strong Q1 as we continued supporting drilling campaigns in the Orange Basin, and kicked off projects in Congo and the Ivory Coast. In the short term, for the remainder of 2025, we still have several tender awards outstanding for the second half of the year, related to additional drilling campaigns in the Orange Basin. Which we expect to have clarity on by around midyear.

27m 10s

Longer term, in Angola, both Sonogol and Capco have come out with multiple vessel tenders to support ongoing production activities from mid-twenty twenty six. Onwards. And the ongoing government continues to push the IOC to increase production in country. Mentioned on previous calls, we may see some short term headwind in the region, but longer term, we expect to see an increase in demand in the region, not only from the continuing development of the Orange Basin, but also from an expected uptick in tendering activity in Nigeria with a number of projects slated to kick off in the second half of twenty twenty six. In The Middle East, the market remains very tight with limited vessel availability and increasing demand. Region performed very well in Q1, And while new tendering activity was relatively muted due to the eve celebrations falling during Q1, we've already started to see tendering activity pick up again during Q2 both from the NOCs and subsea contractors. Overall, our outlook for the region remains very positive for the remainder of the year and into 2026. Lastly, in Asia Pacific, the region performed well in Q1, And looking out over the rest of the year and beyond, there are numerous outstanding long term tenders in Australia, Malaysia and Indonesia.

28m 23s

Which bode well to the long term large PSV demand story in the region. In addition, there is significant subsea construction activity expected in Australia in the second half of twenty twenty five, which will require large AHTSs and large PSVs. Support during Q3 and Q4. For the remainder of 2025, the team will remain vigilant to any potential potential issues that might arise from the current potential economic headwinds, But at present, the business seems set fair for the remainder of the year. We will remain focused and disciplined on continuing to maintain and improve Tidewater's position in the market. Overall, as mentioned by Quentin, we are pleased with how our global team, both on the on and offshore, continue to perform with the highest level of dedication professionalism, and we look forward to what the rest of 2025 brings. With that, I'll hand it over to Sand. Thank you.

29m 13s

Thank you, Pearce, and good morning, everyone. At this time, I would like to take you through our financial results. Our discussion will focus primarily on quarter to quarter results of the first quarter of twenty twenty five compared to the fourth quarter of twenty twenty four.

29m 28s

Including operational aspects that affected the first quarter. As noted in our press release filed yesterday, we reported net income of $42,700,000 for the quarter or $0.83 per share. We generated revenue of $333,400,000 compared to $345,100,000 in the fourth quarter. A total decrease of $12,000,000 or about 3%. First quarter average day rates of $22,303 per day were marginally higher versus the fourth quarter. We also saw a slight increase in active from 77.7% in the fourth quarter to 78.4% in the first quarter due mainly to the decrease in idle, drydock and repair days. Gross margin in the first quarter was 167,000,000 compared to $174,000,000 in the quarter. Gross margin percentage came in at 50.1% compared to 50.4% in Q4 which marks two consecutive quarters with margins over 50%. We did expect gross margin to fall slightly from Q4 levels. However, the the decline was less than anticipated. Primarily due to the higher than expected revenue combined with the reduction in operating costs. Adjusted EBITDA was $154.2 in the first quarter compared to $138,400,000 in the fourth quarter. As a reminder, in Q4, we recorded a $14,300,000 FX loss that negatively impacted our adjusted EBITDA. In the first quarter, we experienced a partial reversal of this FX loss and recorded a $7,600,000 FX gain as a result of the weakening in U. S. Dollar in the latter portion of Q1.

31m 13s

Vessel operating costs for the first quarter were approximately $165,000,000 compared to $170,400,000 in Q4 During Q1, we were able to reduce crew on some of our idle vessels a minimum manning level and additionally, we had a couple of vessels operating in Southeast Asia instead of Australia where Mariner costs is lower. Combination of which contributed 2,700,000.0 to the decrease in crew salaries and travel costs. R and M expense was also down approximately $4,800,000 compared to Q4 due mainly to lower unplanned repair days and costs with largest decreases related to our APAC and Europe and Mediterranean regions. Also, we had two sixty six fewer idle days 52 fewer drydock days and 13 fewer mobilization days which also helped reduce our supplies and consumable expense for the quarter by about $900,000 Offsetting these decreases were insurance, variable charter and other miscellaneous costs that came in higher than the prior quarter. G and A cost for the quarter was $29,100,000 $1,600,000 lower than the fourth quarter due primarily to a decrease in professional fees. We are still projecting G and A costs to be about $119,000,000 for 2025, which includes $15,000,000 of non cash stock based compensation. A reminder, we conduct our business through five segments.

32m 42s

I refer to the tables in the press release and the segment footnote and results of operations discussions in the October for details of our regional results. In the first quarter, consolidated average day rates were up slightly versus fourth quarter. However, results vary by segment with our Americas day rates improving by 8% and our Middle East day rates improving by almost 5%. We saw marginal increases in dayrates in our Africa and APAC regions in our Europe and Mediterranean region. Which is the most affected by seasonality decreased about 4% Total revenues were down compared to the fourth quarter with revenues up in the Middle East region by 6%, while revenues in all other regions increased compared to Q4. Regionally, gross margin increased in the APAC and Middle East regions, but decreased in our other three regions. The increase in the Middle East region was due to increases in average day rates and utilization as well as a minor decrease in operating expenses. The increase in the APAC region was primarily due to a 14% decrease in operating expenses versus the fourth quarter. In Africa, we saw a gross margin decrease of about one percentage point primarily due to a slight decrease in utilization.

33m 58s

Due to higher stack days related to our crew votes. Combined with slightly higher vessel operating costs. Our Europe and Mediterranean region also saw a gross margin decrease of about one percentage point due to marginally lower utilization resulting primarily from more drydock days. Our Americas region, we saw a decrease in gross margin due primarily to lower utilization from high higher idle and repair days partially offset by fewer drydock days. [indiscernible] We generated $94,700,000 in free cash flow this quarter compared to $107,000,000 in Q4. The free cash flow decreased quarter over quarter was primarily attributable to higher drydock and CapEx costs and lower proceeds from asset sales. Offset by improved cash flows from net working capital activities. Despite the improved working capital, I do want to mention that we have not received payments for several quarters from our primary customer in Mexico. Outstanding receivable balance as of March 31 was 35,100,000.0 Historically, we have not had any write offs due to collectability of their receivables and do not expect any in the future. However, we will continue to monitor these receivables. During the first quarter, we made $12,500,000 in principal payments on our senior secured term loan We also incurred $43,300,000 in deferred drydock costs.

35m 24s

Compared to $17,700,000 in the fourth quarter. We had nine fifty drydock days that affect utilization by about five percentage points during the first quarter. For the year, we're still projecting drydock costs to be about $113,000,000 We incurred $10,300,000 in capital expenditures in Q1 related to various CapEx projects including ballast water treatment installation, DP upgrades, fuel system upgrades and various IT upgrades. Both onshore and vessel related. For the year, we still project capital expenditures of 37,000,000 In the quarter, we sold two vessels for proceeds of $3,800,000 And in Q4, we also sold two vessels for proceeds of $4,500,000 As mentioned previously, we had no immediate need to refinance our existing debt. As we have no near term maturities. However, as noted earlier, we get closer to the expiration of call premiums and as market conditions become favorable, in the debt and capital markets, we will be optimistic and weigh the cost benefit of a potential refinancing. During Q1 twenty twenty five, we used $393,000,000 dollars in cash to repurchase approximately 910,000 shares in the market. In April, we spent approximately $51,000,000 in share repurchases to bring our total twenty twenty five repurchases to about $90,000,000 which further reduced our shares outstanding by approximately 2,300,000.0 shares.

36m 53s

Also similar to the first quarter of twenty twenty four, we held back approximately 180,000 shares to pay roughly $7,500,000 in taxes related to vesting of employee share based awards. As we all know, the industry is navigating global economic uncertainty related to challenged commodity prices as well as recent tariff announcements. There is some lack of clarity as to how these factors will ultimately play out. Currently, we do not anticipate direct tariff exposure to drive a meaningful increase in our cost as we have access to local sourcing for most of our equipment. Materials and supply needs in our international locations. However, we may indirectly expose may be indirectly exposed to tariffs in the form of increased costs from our U. S. Based suppliers. Or subject to tariffs. At this point, we have not observed any supplier price increase in this regard However, most vendors still appear to be assessing the situation. And the impact tariffs may have on them. We are in ongoing discussions with our suppliers to understand the potential impact of the tariff regimes and we'll work with them to mitigate these increases. In Q1, the in summary, Q1 is typically the slowest quarter of the year.

38m 11s

Due to seasonality that normally occurs. However, this quarter proved to be different as our financial results were well above our initial expectations. Industry long term fundamentals remain strong despite uncertain global economic environment. Despite this uncertainty, we expect to achieve our financial guidance and expect to continue to generate strong free cash flows and profitability in each sub quarter of the year. In the near term, we will continue to invest in our fleet pursue attractive M and A opportunities, manage our cost structure efficiently and execute operationally at a high level. The first quarter also demonstrated our commitment to pursue share repurchases as an attractive investment option and return of avenue for our shareholders. Remain optimistic about our current position about the strong long term fundamentals of the industry and about the opportunities that lie ahead for Tidewater. With that, I'll turn the call back over to Quentin.

39m 12s

Thank you, Sam. Janice, we will go ahead and open it up for questions.

39m 17s

Thank you. Your first question comes from the line of Jim Rollison with Raymond James. Please go ahead.

39m 36s

Hey, good morning, Quentin and everyone else.

39m 39s

Nice nice job on, I guess, a good start to the year and a normally seasonally slow slow period. Quentin, you referenced this a little bit, but kind of listening through this earnings season so far, to some of the offshore drilling contractors and subsea contractors, Everyone's kind of echoed the same thing as far as not seeing any changes to plans and maybe further to that the view that activity picks up when we start getting into the back half of twenty twenty six and 2027 is being kind of reiterated and maybe buoyed by a recent contract awards. I'm curious if you guys are seeing that translate into conversations yet, or if it's still too soon? Just because it seems like we're building towards a better at least second half twenty twenty six and 2027 assuming the macro doesn't get worse from here. But curious kind of what you guys are hearing and seeing.

40m 37s

Jim, thanks. Actually, I'm going to give this over to Pierce because he's closer to the conversations with the customers related to those particular drilling contracts.

40m 45s

Yes. Hi, Jim. Good question. I mean, think as we've commented, we haven't seen any changes from our customers in terms of their outlook and views. I expectations hasn't changed. We've still got, as we sort of mentioned, a couple of outstanding tenders, which were still in active discussions on for the second half of twenty twenty five. We are seeing the same amount of sort of pre tender type discussions with our customers hasn't slowed down either. We saw a tick up in Q1 on those, which [indiscernible] are more them looking for vessels going out for 2026 and 2027 and seeing what the market looks like. So as where we sit today, those conversations haven't slowed down and still look very positive. But obviously, there's always an end of caution with anything in this business. As we look forward. But no, at the moment, we're not seeing anything in the teams on the ground haven't seen any slowdown in those conversations yet.

41m 51s

Got it. Appreciate that color, Piers. And maybe as a follow-up, probably probably back to you, but you mentioned a couple of regions, one being North Sea, expectations of assets moving out of their Curious if you guys expect to participate in that or just benefit from the tightening market. And the other one might be, of quarters ago, you had brought up some of the challenges in the Asian market related to Malaysia. And kind of the softness for a period of time It sounds like things are tightening back up. And if I recall correctly, you know, that tightening back up was the difference between you guys being able to continue pushing price or not. I'm curious how that's shaping up for you.

42m 32s

Thanks. [indiscernible] I think we'll benefit from that. I'm not going to say whether or we're going to be taking part actively in anything with Petrobras. It's an ongoing discussion here. But mean, we've already heard of a number of vessels which are going to be moving to Brazil. So I'd expect that to continue, that will help to tighten both The UK or at least supply down in The UK, which will be to our advantage is my belief. And in Asia Pacific, Malaysia is back online They obviously had Eid as well in Q1 similar to The Middle East, so we didn't see much activity out of Petronas, but they have started to come back and putting vessels back on. So tend to move a little bit slower when you're dealing with the NOCs and perhaps the IOCs. So expect that sort of full impact of that sucking up their supply more of a Q3, Q4 type of story for Malaysia. In particular. But Malaysia is the biggest market in that region in terms of the amount of vessels in that. So it'll take a little bit of time for that to work through on the effects. But now I think by the end of the year, you'll see most of that supply most of those Malaysian flag booming vessels go back into long term contracts, again, with Malaysia, which with Petronas, which will be good for us.

43m 56s

Your next question comes from the line of Greg Lewis with BTIG. Please go ahead.

44m 2s

Yes. Hi, thank you and good morning and thanks for taking my questions.

44m 7s

Quinn, good quarter. I did have a couple questions around the forward margin guidance for Q2. As I kind of look at the fleet, it looks like we stacked a couple of vessels, a handful plus in across like West Africa largely. Is there an I guess two questions around that. Is there an stacking cost that's going to hit margins in Q2? And any kind of color on the on those types of vessels? Are they kind of core vessels that are just dealing through some spotty work or they may be older vessels that that maybe are stacked and and and maybe you're never coming back?

44m 59s

Greg, listen, I think you're spot on actually in the sense that it's certainly in Africa and it's a certain class of vessels. But the person that's been working directly on this is Wes. So Wes can walk you through exactly what's been happening over there. Hey, Hey, Greg. Good morning. So to your first question, I believe at the end of quarter we had six vessels stacked. Five of the six are what we refer to as Alucats okay? So these are very small effectively crude transport I mean these are 30 foot long top. These are not what we would refer to as our core vessels. They're core for that region because we do have legacy position with a couple of customers primarily in Angola where we have kind of a full logistics offering including crude transfer which these value caps provide. But these are not our core PSVs or anchor handlers that principally comprise the business and really drive a lot of the revenue and margin profile. Is one small anchor handler that is stacked, I believe it's one of the lower classes. So when you look at that, that's not those vessels are not a major contributor to the financial outlook or financial profile of the business.

46m 15s

Okay. And so and then like when we think about the stocking cost of those, it sounds like it would be negligible?

46m 23s

Yes, absolutely.

46m 25s

Good news, bad news in our business, the stacking costs for almost any type of vessel are generally quite low certainly as compared to a drilling unit. But for an alucater of this nature, a very small crude transfer vessel, it's a de minimis cost.

46m 42s

Okay, great. And on Piercy, You Mentioned The Brazil tender for for next year. I realize you have it looks like maybe a little over a handful of vessels in Brazil. I don't believe any of those are working. I believe they're all kind of with the the IOCs, not Petrobras. That being said, we've seen some kind of pretty Brazil's kind of been the saving has been one of the stronger basins in terms of day rate momentum. That we've seen really over the last twelve months? Any kind of thoughts around that 18 vessel tender? Is that going to be incremental both? I mean, I know it's mix of local and international players that are going to be awarded. Any kind of color you can give around that being incremental and kind of where maybe not we don't know where the pricing is going to be on those lots as they come in next year. But any kind of view on what the pricing market is in Brazil just because that is going to impact your non Petrobras vessels in that basin?

47m 56s

Yes.

47m 56s

So I mean, good news is that some of those 18 ships are incremental. To what Petrobras currently have. We're sort of just working through how many, but definitely going to be a number of vessels, which are in addition to what Petrobras already has. I think in terms of rates, I think you talked about it on the last call about where the newbuilding rates come in at sort of high 50s. I think obviously this is for existing vessels and stuff. But think that's a pretty good guide as to where rates can start pushing towards for Brazil, And that we're in a very we sort of said many times, this is a finely balanced supplydemand balance at the moment, and I think anything where you see incremental demand in Brazil is going to really help the other regions. Not going to happen from one quarter to the other. Will take a few quarters for that to really pull through. But I think that opportunity in Brazil with Petrobras is really going to help tighten up the market a little bit in the North Sea, which is, as we've said, has always been a little bit slower than everywhere else at the moment.

49m 1s

So I think it's a very good story going forward over the longer term. As to what Petrobras is doing.

49m 10s

Your next question comes from the line of Frederic Steen with Clarkson Securities. Please go ahead.

49m 18s

Hey, Quentin and team. Hope you're well and congratulations on a strong quarter.

49m 25s

So I wanted to touch a bit more on the guidance commentary that you gave. You're reiterating guidance for the year $1,320,000,000 to 1,380,000,000.00 of revenue, 48,000,000,000 to 50% gross margin.

49m 41s

But compared to I think, their guidance for the first quarter during the fourth quarter call, that quarter also exceeded your own expectations. So I guess I was hoping for some color on how the second quarter, third quarter, fourth quarter outlook [indiscernible] still be able to keep the guidance has changed from how you looked those respective quarters before, right? Is the first workout performance a way for you to make up for what now is potentially you know, the relative weakness in those other three quarters? Or are they still the same as before and we have a higher chance maybe to end up slightly in the upper end of the guidance. So any color that you can give us to help us understand how those periods have developed since we lost on a call like this with the super app for? Thank you.

50m 44s

Hey, Fredrik, it's Wes. Good morning and thanks for the question. So you're right, we did outperform in Q1, which was obviously well received and we're pleased with. But we laid out that we have about 88% of our backlog covered by contracts right now, okay? So that gives us a degree of confidence. And as we said both in the press release and I believe here this morning, we haven't seen anything to the contrary that would make think any of the projects that we're expecting or pursuing have been canceled or delayed. But we still have some open revenue days and some uncontracted days within our fleet and in the backlog that we have to secure in order to ultimately hit the midyear the midpoint of our full year revenue range. So I think from all the facts that we know today that I just laid out, that gave us the comfort to reiterate guidance Is there still uncertainty there? Are there still open days? And kind of go get? Yes, there is. And so the Q1 revenue outperformance gave us a little bit more confidence, but there's still some uncertainty there just naturally through some of the exposure we have that we have to contemplate when reiterating that guidance.

52m 4s

Yes. Frederic, this is Quentin. And let me tell you a something else that I think about when we talk about the guidance. Of the reasons that we did well in Q1 is that our downfall repair days was less than anticipated. And that doesn't always hit on a pro rata basis. So some of that you may see, you know, kind of roll into sprinkled into Q2, Q3 and Q4 with the hope that we do actually continue to outperform GFR them for repair basis. But it's one of those where we've struggled with it for the last couple of years and I'm not ready to kind of set a new benchmark a little bit lower on DFR. And so the DFR outperformance that we saw in Q1 theoretically is expected to hit us somewhere in Qs two, three and four.

52m 55s

That's very good color. Thank you. And as a follow-up, on all of it, how are you obviously, I don't expect you to guide on 2026. But how do you feel the, call it, the backlog for 2026 has progressed compared to where we were during the fourth quarter call.

53m 23s

I think we discussed this on last quarter's call. We typically given next year's backlog and I think we'll likely keep that stance. As Piers mentioned, there are we certainly have backlog in twenty '26 I suspect that's continued to improve. And as Piers mentioned, the pre tendering discussions continue in a very positive positive way. And we've talked about the average length of our contract over time and that's roughly six quarters or so and that still persists. So we certainly have coverage out in the '26, obviously not the same degree as '25 given our short contracting strategy. But I would say given what we see in the drilling market, the production market, the subsea market that our outlook still remains fairly constructive. And as we said, some cautious optimism about what the intermediate term outlook looks like.

54m 21s

Your next question comes from the line of David Smith with Pickering Energy Partners. Please go ahead.

54m 28s

Hey, good morning. Congratulations on the strong quarter and thank you for taking my questions.

54m 33s

Thank you, Dave.

54m 36s

I wanted to follow-up on Greg's stacking question. And hopefully, you know, this this is a hypothetical and say it that way, but could you please walk us through the decision making framework that you use when deciding whether to to stack a vessel versus keeping it warm or or chasing spot work?

54m 53s

Like, are there specific rate thresholds, visibility metrics, maybe region specific factors?

55m 1s

It's all of those. And these particular vessels they don't really have an operating sphere outside of West Africa and really not even that far outside of Malongo, okay? So the relationship with the existing existing customer there, Capgec or Chevron, is going to dictate how many they need and what we can get for those particular vessels at a given time. Those vessels also are very high maintenance vessels. So they cost they're inexpensive vessels, but they're disproportionately more expensive per dollar of capital cost. So we have to manage the fleet somewhat tightly. We've had some new deliveries into that market in the last six to eight months. And so as a result, these vessels got put into layup. And sense is that these vessels will probably likely be sold. But it is an economic consideration. So we think about it on the availability of opportunities out there. What we expect utilization to be. And again, are higher maintenance vessels so they generally have lower utilization. And also what we can get with them in the open market outside of in this case Malone.

56m 14s

Great. I appreciate that.

56m 16s

And just wanted to confirm that I heard guidance correctly for for q two revenue down 5% sequentially at 44% margins?

56m 25s

That's correct, Dave.

56m 28s

Was that the think the full year guidance midpoint would kind of point to second half gross margin that's maybe 15% to 16% better than the first half. And just wanted to ask if if that you know, it's it's primarily the benefit of of better utilization. Or, you know, is is there also some some visibility for contract rollover contributing to better pricing in the second half? [indiscernible] generally driven by better utilization. But as we also said, as drydocks decline and as we think the FR days kind of normalize to some degree, there's a little bit of OpEx improvement, but the primary driver is the utilization.

57m 15s

Your next question comes from the line of Don Crist with Johnson Rice. Please go ahead.

57m 21s

Good morning, guys. Thanks for letting me in. Pierce, on the tendering side, can you kind of walk us through the kind of timeline normally seen on these tenders? And what I'm kind of driving at is if you have a tender that has a, call it, a July 1 start up for 2026, when is that generally signed and kind of put on the books? Is that kind of a six month out process? Or is it shorter or longer than that?

57m 52s

It really depends on end customer. We tend to the subsidy contracts tend to come to the market a quarter ahead of what when they need vessels. So they're much more sort of short term, which is why we think about the second half of 'twenty five, we've got some subsea contractor works scopes we're still bidding for. But when you're looking at something like Petrobras, not really work with Petrobras, but it's on that 18 ship tender that come out now. That will probably be it will take them three to six months to get organized on that. So probably end of this year, you'll hear from them for vessels working in mid -twenty twenty six. So it really depends on the type of working customers. North Sea tends to be a little bit shorter term because it's just a little bit more of a a transparent and spot type of market there. So areas like Africa and some of the tenders we're doing there because it's a more complicated region and it takes time. The tenders which we're working on at the moment, some of the longer term ones yes, then you're in the sometimes it will take a year from the tender comes out to when the vessels actually start And so they're sort of similar in line with Petrobras.

59m 7s

There's no there's no exact rule of thumb, I'm afraid. I can't give you every customer is different, and we all love them for it. So that's what we have to play with.

59m 19s

Okay. I appreciate that color. But it's kind of safe to say that you should know two to three quarters ahead of what your utilization generally speaking would be.

59m 31s

Yes, in general. Okay.

59m 36s

And then I guess one for West. On or or or Quentin.

59m 42s

Just on capital allocation and the balance sheet, obviously, are very focused on M and A and have been for a long time. But bonds that you currently have outstanding are kind of a hindrance to some flexibility you might have on buyback side. Kind of priority would you put on kind of debt refinancing versus kind of leaving that out and not having the flexibility on share buybacks as we kind of move forward? So use of proceeds obviously important for us. I don't see the need to delever at this point. So it really just becomes an economic and opportunistic consideration as to resetting the capital structure Obviously, if we were not able to find suitable acquisitions, which would be my first preference, And we started inadvertently building cash we would certainly consider the fact we have all this negative carry and whether or not it's worth the cost of refinancing the debt. Because there's a relatively large cost today for that. But I would say that it's purely economic with the idea of maximizing equity shareholder value. My preference is to redeploy it into value accretive acquisitions as opposed to new builds or anything like that.

1h 1m 9s

Thank you. I will now turn the call back over to Kintin Min, CEO for closing remarks. Please go ahead.

1h 1m 15s

Well, Janice, everyone, you very much, and we will update you again in August.

1h 1m 20s

Goodbye.

1h 1m 22s

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Key Insights

Q1 2025 revenue was $333.4M, with gross margin over 50% for the second consecutive quarter; day rates set a new record at $22,303/day, and free cash flow was $95M, the second highest since the offshore recovery began.
The company fully utilized its $90M share repurchase authorization, buying back approximately 2.5M shares at an average price of $39.47, and further reduced share count by 180,000 shares for employee tax payments.
Full-year 2025 revenue guidance is reiterated at $1.32B–$1.38B with gross margin of 48%–50%; Q2 revenue is expected to decline ~5% sequentially with gross margin at 44%, but utilization and margins are expected to improve in the second half of the year.
Vessel supply remains tight with under 3% of global supply on order and newbuild activity expected to remain low until at least late 2026 or 2027, supporting the expectation that demand will outpace supply in the intermediate term.
Regional market dynamics are mixed: Brazil, Middle East, Africa, and Southeast Asia are strengthening, while North Sea and Mexico face demand challenges; no customer project cancellations or deferrals have been observed, and backlog plus options cover ~88% of 2025 revenue guidance.

Recent Transcripts

Q1 revenue and margins exceeded expectations; 2025 guidance reiterated with strong cash flow and buybacks.

Tidewater's 2024 revenue rose 33%, with strong cash flow, buybacks, and positive 2025 outlook.

Market Cap: $2.4B
IPO Date: 3/17/80
CEO: Mr. Quintin V. Kneen CPA
Fulltime Employees: 7.7K
Sector: Energy
Industry: Oil & Gas Equipment & Services
Country: US
Exchange: New York Stock Exchange

Peers

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Watchlist

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Tidewater Inc. Stock Price: Quote, Forecast, Splits & News (TDW)

Earnings

Report Date

May 5, 2025

Reported Revenue

333.4M

Beat +0.54%

Avg 1d Change

7.05%

Report Period

Q1 2025

Reported EPS

0.83

Beat +69.39%

Implied Move 1d

10.68%

Transcript

10m 22s

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19m 41s

And with that, let me turn the call back over to Wes for additional commentary and our financial outlook. Thank you, Clinton.

19m 49s

21m 6s

22m 5s

23m 14s

As we progress into the back half of the year, we anticipate a material uplift in utilization in the third quarter and further modest strengthening into the fourth quarter.

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39m 12s

Thank you, Sam. Janice, we will go ahead and open it up for questions.

39m 17s

Thank you. Your first question comes from the line of Jim Rollison with Raymond James. Please go ahead.

39m 36s

Hey, good morning, Quentin and everyone else.

39m 39s

40m 37s

Jim, thanks. Actually, I'm going to give this over to Pierce because he's closer to the conversations with the customers related to those particular drilling contracts.

40m 45s

41m 51s

42m 32s

43m 56s

Your next question comes from the line of Greg Lewis with BTIG. Please go ahead.

44m 2s

Yes. Hi, thank you and good morning and thanks for taking my questions.

44m 7s

44m 59s

46m 15s

Okay. And so and then like when we think about the stocking cost of those, it sounds like it would be negligible?

46m 23s

Yes, absolutely.

46m 25s

46m 42s

47m 56s

Yes.

47m 56s

49m 1s

So I think it's a very good story going forward over the longer term. As to what Petrobras is doing.

49m 10s

Your next question comes from the line of Frederic Steen with Clarkson Securities. Please go ahead.

49m 18s

Hey, Quentin and team. Hope you're well and congratulations on a strong quarter.

49m 25s

So I wanted to touch a bit more on the guidance commentary that you gave. You're reiterating guidance for the year $1,320,000,000 to 1,380,000,000.00 of revenue, 48,000,000,000 to 50% gross margin.

49m 41s

50m 44s

52m 4s

52m 55s

53m 23s

54m 21s

Your next question comes from the line of David Smith with Pickering Energy Partners. Please go ahead.

54m 28s

Hey, good morning. Congratulations on the strong quarter and thank you for taking my questions.

54m 33s

Thank you, Dave.

54m 36s

54m 53s

Like, are there specific rate thresholds, visibility metrics, maybe region specific factors?

55m 1s

56m 14s

Great. I appreciate that.

56m 16s

And just wanted to confirm that I heard guidance correctly for for q two revenue down 5% sequentially at 44% margins?

56m 25s

That's correct, Dave.

56m 28s

57m 15s

Your next question comes from the line of Don Crist with Johnson Rice. Please go ahead.

57m 21s

57m 52s

59m 7s

There's no there's no exact rule of thumb, I'm afraid. I can't give you every customer is different, and we all love them for it. So that's what we have to play with.

59m 19s

Okay. I appreciate that color. But it's kind of safe to say that you should know two to three quarters ahead of what your utilization generally speaking would be.

59m 31s

Yes, in general. Okay.

59m 36s

And then I guess one for West. On or or or Quentin.

59m 42s

1h 1m 9s

Thank you. I will now turn the call back over to Kintin Min, CEO for closing remarks. Please go ahead.

1h 1m 15s

Well, Janice, everyone, you very much, and we will update you again in August.

1h 1m 20s

Goodbye.

1h 1m 22s

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Key Insights

Q1 2025 revenue was $333.4M, with gross margin over 50% for the second consecutive quarter; day rates set a new record at $22,303/day, and free cash flow was $95M, the second highest since the offshore recovery began.
The company fully utilized its $90M share repurchase authorization, buying back approximately 2.5M shares at an average price of $39.47, and further reduced share count by 180,000 shares for employee tax payments.
Full-year 2025 revenue guidance is reiterated at $1.32B–$1.38B with gross margin of 48%–50%; Q2 revenue is expected to decline ~5% sequentially with gross margin at 44%, but utilization and margins are expected to improve in the second half of the year.
Vessel supply remains tight with under 3% of global supply on order and newbuild activity expected to remain low until at least late 2026 or 2027, supporting the expectation that demand will outpace supply in the intermediate term.
Regional market dynamics are mixed: Brazil, Middle East, Africa, and Southeast Asia are strengthening, while North Sea and Mexico face demand challenges; no customer project cancellations or deferrals have been observed, and backlog plus options cover ~88% of 2025 revenue guidance.