Tidewater (TDW) 9 Mar 222021 Q4 Earnings call transcript

Hello, and welcome to the Tidewater Fourth Quarter 2021 Earnings Call and Swire Pacific Offshore acquisition announcement. My name is Alex, and I'll be coordinating the call today. [Operator Instructions]

I will now hand over to your host, West Gotcher, Vice President of Finance and Investor Relations. Over to you, West.

Alex. you, Thank and the everyone, also Tidewater's conference earnings Swire Good months welcome ended for announcement. X Offshore and December call Pacific morning, acquisition to XX, the XXXX, by joined of Marketing, our our I'm Sales Financial Rubio; Secretary, and and Sam Piers General Officer, call our Daniel the this Hudson; Chief President CEO, and Quintin on and Kneen; Counsel Corporate our Middleton. morning Vice President

expectations. on performance to There make certain statements are our our During speaks XX-Q any and sec.gov. factors. today, plans during we referring factors that as any on the be and of materially through for comment is risks today's may available tdw.com details no we'll call, to make by time may most from call today's other website at are forward-looking March that or accurate the replay. uncertainties to any and cause and XXXX. SEC call. you're implied conference different Form refer longer at this document that only additional stated our that the on company's be advised This at actual that Please or Therefore, time-sensitive of information X, presented these Information recent

Also, non-GAAP non-GAAP reconciliation of press both measures yesterday's during GAAP is GAAP call, present financial the release. to we'll and measures. A included in

the to Quintin. turn over call that, I'll And now with

last-minute the accommodating releases and linked via transaction potential Earnings wee XXXX added find the We've on X visible as you It for West. night, welcome Call. Good those press in well information the releases Quarter release up present catching go the exchanges. listening Hong with Tidewater the with to to call call Conference the the the some will to to we help had webcast. Thank the announced of you as to release. you, press time we stock us will with deck Thank slide for and morning, and slightly a didn't conference addition everyone, on simultaneously press Today's or update Fourth you quarter, additional along provide a also be in different in to business this the combination interfere of was on synergy Kong we NYSE to hours this as that it's deal. releasing the but the earnings

can when they you come come As deals together together. appreciate,

Sam's on earnings to Also, been holding for the over week. release a

to it all in figure So the information out one get the we to best you swoop. just fell

I'm and has goes. to quarter since been quarter So and spoke. for events last this had as several solid thank it and say that transactions you, we another pleased Tidewater here a busy we

that early In benefits out addition quarter Pacific bought and announced we of to Offshore. tax fleet acquire last mentioned we night on the XX-vessel joint our call. third debt the we quarter, conference closed We entering on the definitive We to Swire solid agreement the terminated refinancing into a partner plan. preservation venture earnings the Angola, we're in

pandemic-driven XX% are activity has increasing pullback an expected increasing areas a revenue activity good and noteworthy, into other up quarter, the other softness the third $XXX But were the past the fourth the the increase. in quarterly ticked The our nicely, this and and are slightly, up in quarters. in North year, is offsets but upside was third increase the indication fourth levels up in even becoming positive, just proceed quarter. is year, was million from every Sea quarter cycle. noteworthy. XX% offshore Revenue increases over Also and surprised accepted the this Revenue we for in seasonal up the more by the the customers and that resulting Sea any Usually, as North to the quarter. trend areas the

of forgive and each most is before, like is year weakest as you first the quarter, but remind quarter it typical to in Sea. me, of calendar, beginning quarter know people the heard of I'd the on have in higher I the like at this a some the the Historically, charter to weather that, addition you charter to calendar-year a basis But the customers due first gap quarter. year, fourth in get of North the so bit

shy quarter, also Gross charge. annual margin pushed points the to the That the XX.X%, to XX% XX.X% margin percentage for noncash guidance the improved year. during just up impairment up of X.X our gross before

Our increased last $X the up that million for recall And G&A due we may G&A costs had included fees. year to professional for quarter you bumped the transaction just announced.

as we were cost, But course, was absent from XX% XXXX. G&A Of for million negotiations. down million, in year the necessarily the deal $XX.X quarter was vague $XX.X deal the in last the

of annualized combined confident in Offshore. last the now the was a to But a $XXX call. the our G&A details forward at for cycle, in as We're going Tidewater peak in merger with expense bit was just the ability give Pacific you the with some $XX.X more the on estimated and fourth that and Our the achieve and G&A will we million. this talk was synergies reminder, $XXX million. $XX.X going combined in into we G&A million. million; later XXXX get deal, We're to quite GulfMark quarter transaction the stand-alone, for G&A about Swire We're a G&A as moment

one half first Free the flow and offshore the additional quarter through second the reason the is positive so of a vessel were XXXX. second flow cash you free reactivate overwhelm due our year to going of the the the vessel the the recovered we This flow of of And for for same be We from half year XXXX more in vessel is cash margin year, mantras reactivations it to of half for the the market. was the as cash gross go year. bulk lower that first to was the certain and the half every being cost reactivations. free during the until doesn't is to earned as of million, I'm of recall $XX.X

end be are or sold The working relaying by is that we're mantra that. to all other track have the of achieving we on that XXXX, for been going boats

of XX layup we are us gainfully margin. gross Swire points, that both expenses impacts. to sure Pacific in That's intend XX us pandemic-related addition, and active, costing employed. make X Vessels points the offshore million remain OpEx approximately in and off-hire of In $XX.X the costs percentage XX percentage vessels X XXXX. Recall are

we the on over events we Sam to quarter Piers. that call I'll let on the plan few a in you the revolver quarter. but benefits I terminated the I'll hand the new We the tax new issued and moment, update in had other a you before early in update preservation fourth bonds fourth

as hit the limitation to You we preclude million. of or tax which credits, $XXX inadvertent recall, place unnecessary put the will over just are our pandemic in substantial,

disposition. that as on the in anniversary X-year -- appreciate can Board a the in IRS soon moved One that limitation is few XXXX. not plan. determination The And attributes quarter our as limitation these key factors terminate be of that a tripping acquisition rolling the X-year certainly GulfMark computation. seen is and tax the key the as of to of not the Board shareholder-friendly, deal was and plans the We the these occurred, fourth early of

As the sufficiently, the terminate as Board plan. acted plan to probability soon the lowered of the was tripping

transaction the the X-year concern it proposed to With not enough naturally, average, rolling Swire but us. involving Pacific elevates Offshore, to regards

purchased Tidewater we Swire is that outstanding and venture. use venture Angola. in control our efficiency and in completed so held to offshore XX% transaction that were paying vessels venture Another commission of XXXX the XX% joint us It transaction the in interest This there. the to us assets for rest us West to allows the consolidate a fully joint Africa, in in have to XX the the allows quarter our Sonatide, eliminates growth by first net We joint our Angola. $XX located allowing Pacific we early of $XX.X the the to partner's platform Doing for Angola we of to business Angola, million. to us including operate throughout million acquisition improvements bring brought in allows the

Also that no ATM We in place at-the-money was put quarter. in the the stock plan. fourth issuance under it fourth mentioned issued we since initiated the previously quarter, plan shares in plan, the

use repurchase hold Jones Warrants. intended to to Act warrants the holders are holder foreign Jones recall, for Warrant shares Act you citizen to of the can't who the U.S. Jones due plan given meet equity is limitation. so many the Act Our regular equity they not Warrants, a as do requirements,

intended Our Tidewater intention with under for net ATM shares by warrants exchange to This issuing million Jones ATM intend Jones Act to for the in Warrants X.X of transaction new and GulfMark market and Act issued. have we those create plan Offshore. new those restructurings, proposed are in plan no shares from the to is remaining Pacific is be We plan facilitate equity out X.X warrants, the issue approximately getting a Swire the the involving Warrants. million still to

out, holding the any impacting dilution call and us a you get want and at If we time, and given just market what issuance, now. something in adversely creating a to the in interested. float holders. There's with if We're But equity give a us no to of Obviously, give you're mindful we're price. control working warrants open call. these we're interested more to not win-win you're the compared

strategic not Offshore. rationale certainly more Pacific but the give you least, me and the for last details. proposed transaction will overview Piers Swire of an Sam And give you involving let

purchase issue acquisition mentioned, $X.X ship million compared The average just a transaction total is of Tidewater's million X.X $X.X $XXX million this and to price cash ship debt-free. The intend of Warrants Act value per to of about value for I per $XX million. million. As of is we Jones

under vessels brand. is to the intention operate Our Tidewater new the

industry do fleet Swire to is strategic known the in of Pacific we combination top flow a mariners now but will great the record Offshore, vessel we've by X free scalable, Their safety of offshore of stellar. vessel some OSVs bringing a industry, fleets their drive of continues. I'll Many is the as reputation It's the talk notch. the identified earnings the is and in Tidewater recovery the cash XXX. great much premier but fleet the moment, operations their -- is presents operators. growth within other full-stop. investors the own largest the these the it world-class, a as with recovery our are not infrastructure. opportunity that realize deal impeccable. market in and clients we meaningful Their shore-based believe know synergies of can company, and with about of about merits to Furthermore, Their

The OSVs combined of PSVs OSVs of mix group. of the largest nice and Africa, This anchor fleet Swire the fleet a Swire's with in West comprised mix in fleet located Southeast East. is vessels the of handlers Middle Asia a XXX and XX now of industry. within primarily large is is each

have presence the will We the but on globally. sizable We large towards will drilling Swire handlers a major from market anchor believe remain capitalize in market. improvement acquired the in forecasted PSVs weighted every

of but quality will every the aspect OSV industry transaction we large Tidewater allow this now to combination position of the combined compelling any in OSV itself the fleet not operator space, believe Another the as of globally. of in youngest choice size only the largest the the fleet. also region is major fleet in We operator are is and

with relative value transactions, been we what and have We equity-driven done of have that's proponents Swire.

we Act basis, Warrant a additional we prudent but approach given running is clearly are in value Furthermore, our the the the and the of also most the Jones us pursue avenues flexibility strength, split, sector. On to investable company of nature allows balance to sheet business, cash growth. the which believe market the retain we

G&A sizable our realization as to -- successfully initial continuous focused that, and merger to time. initiatives isn't to expectations time shore-based It's we're a this important executed approach we based reductions. It's on the our strategy optimizing outperformed a on infrastructure. first and consummated And realize achieve Tidewater-GulfMark our synergies that result, If a developed identified XX that transaction. we of event. on and recall, note quarters over something strategy improvement consecutive M&A from able to previously you'll transaction, and wasn't also the We've one-off strategy a

of to costs of where this from new tweak bring able elimination The portion as anticipate well $XX as be overlap, million existing businesses. believe implement X and savings we combination a protocols. the up I have in, these we approach as we playbook and of I a transaction. shore-based as as and large expenses we All Swire synergies the supplier synergies the operations that leverage is we'll relationships expense operating regional-level of corporate-level our operating then

about the XXXX at million for was would to have EBITDA is look from just fleet nearly extent XXXX, to our currently million and acquisition leverage. would whether that substantial expect fleet provides company transaction up for you EBITDA our day from is another increase all else XXXX we of the excited sale, the EBITDA. generated synergies that To in it that's fleet an earnings approach $XXX generate any excluding $XXX on would compared to increase, or a in us. of of the $XX When in held Swire the that this There's synergies To leverage perspective, the combined help operating added rates constant, meaningful perspective. held with that And million. XX% stand-alone rate million combined million are earnings day given Tidewater basis, about go-forward $XXX sold EBITDA the vessel million utilization doubt a the addition, EBITDA. this Bringing in of add to no will put we $XX every $X,XXX realize but $XX combined we in levels, be

regions, demonstrated active acquired lows. our The vessels market high-quality both will sizable We this with over as Angola now cost past believe continue the the coming as X to the which to cost quarters. a the administrative flight by evident over largest in is there's Pacific Offshore have positioning of significant believe from years. with by to on fleet, the G&A fleet operating working been Africa we we continues pandemic Tidewater the our to we the region. is the fleet categories. synergies to in significantly you grow quality, Tidewater the in include enable the region positions and Swire West performance rebounding we benefits A will fleet, shown the reduced and region infrastructure structure, of This combined now wholly-owned Turning which

operations Swire Again, Pacific addition through natural to Offshore's current management geography. current economies expense in be shore-based scale. a Middle sizable improved and a our from footprint benefits the of position East infrastructure will that in operating

been years, their Swire Our business past area X area, Thailand and position In will tuck has in be adding to this an enviable in over the more into Asia Thailand we but has position Southeast our operations. the limited G&A will nicely vessels Africa utilized it And quality. infrastructure. fleet, seen Similar as to area's speaks to combined costs quality flight are that we a fleet. completely will at time, of our the invest similar in existing we've to West this given Swire's their

positions singularly The region. which a better largest developing wind the provides also participate active a us be combined fleet the to growing will market fleet in throughout offshore well rapidly in and but platform us oil in the market, region, the in gas

be vessel Swire X will sale. vessels in vessel, perhaps includes for Offshore termed XX The Pacific and seismic layup fleet has additional X X vessels to and be held uneconomic

number prior within improving to sold be on the the may footprint of the sold deploy of perspective a closing. vessels on of geographic closing of vessels final the the transaction of after the to be determination enhanced vessels with top an market. swiftly make We'll One a to

years acquired of average However, have our an XX current fleet to relatively we age compared a average young with of fleet's years. XX.X

the to profiles fleet. large PSVs and handlers offering give and in improve combined us the earning compelling meaningfully extends more of age Importantly, and a the these customer classes vessel our our anchor profile

day day The of XXXX average fleet rate Swire XXXX $XX,XXX. above of was rate XX% in our $XX,XXX, the for

the pursue close excited transaction sheet well envisioned our quality, the believe balance to future. additional positioned transaction. about XX in the the leaves in us XX earnings strategic to We are and preservation days. power is We to The the that opportunities fleet of

it the overview over me turn transaction. the of let company's additional commentary an and by that, Piers performance for to region with on some And proposed

Thank you, Quintin, everyone. and good morning,

we how through through as in fruits go we the currently are the see XXXX greater take what we little XXXX see to a then do improving combination goes advantage being talk in I and able in. Swire-Tidewater our see set Sam market and in numbers QX of start we things happening out bear detail, we Before into to on wanted and of to we the some to

year XXXX came we the us XXXX. was and tough industry a transition both very a for of of as out

and XXXX, on have about so QX. revenue XXXX, on in our with teams tenet Every around for commercial we discipline fleet. to our reactivating QX as beyond. On Discipline the able as X region fleet into that saw back demand meant the in as And disciplined these to market have active contract improvement lead on in what bump been on we to QX PSVs anticipated and demand out the remaining all large to had compared been bring utilization for rates, in areas day we're talked start where our discipline really strong contributed majority utilization by term. but the time increased XXXX. responsibility at clearly and large key which and and meet PSV X% in QX a has throughout we culminating quarter-over-quarter, world. felt leader pushing and a we but still of vessels rates, a in that is our increase we story right to global be of to that improving able the Quintin into able see our reactivations, We more deck and to the about to global we've market market approach a rates as discipline advantage XXXX discipline an industry, in incremental XXXX take We set mentioned, of

where recent again demobilization disciplined for and compete to as board who prepared One buy paying isn't the throughout milestones increased long This this survive. the Tidewater higher we've trend volatile across in XXXX. to yet, as get our mobilization customers the that remain to order into competitors and to vessels and certain It which are day QX higher PSVs deck to customers pay but willing appear for desperate projects that utilization for provides, the would our to was ships work best-in-class to to for less translate AHTSs, into now important are. do in rates are whereas XXXX had and disciplined, right, full larger expect continue mobilize their years, of against start to we we tonnage will

flight us able our meet be to to market and and allowed at with as and more more By suppliers a modern the the focusing competitors reactivation and leaving to our up improves in being on of some quality plan customers, concentrate XXXX right shipyards more it philosophy, on able loss-making, to optionality high-graded drive to our with fleet, XXXX. focused, us disciplined demand we then to have not that are rates the and XXXX in the contracts have had but with instead with time contracts long-term first-class take to shorter-term

With create a acquiring of Tidewater. disciplined as the largest which a types modern as XXXX. Swire our combination brilliant fleet will OSV combination mentioned, philosophy we in X and announcement, the and the and is operator company we fleets, important, a similar drive it vessels the of will to They of in have today, the brilliant with revenue best-in-class we're vessels. have allow the people growth with Quintin at And us so created is of that world but

in the AHTSs full for large global are Africa a the XX fleet. will be we projects, in position having importantly, and Pac. vessels customers pay competitive OSV position of XXX-tonne-plus largest to to yes, enhance in both the right fleet the types where in the footprint, and OSV over will PSVs, XX but in starting the close, globally. mobilizations market the West Asia their greatly vessels have But our combination And and locations most truly we of to just get we'll the enviable leverage believe rates not right After right

oil, customers This best-in-class marquee OSV fleet supplier the thought. a won't choice is X clear, combined creates bit our only world. a with market, but quicker around it of this for than the operators for happen the $XXX combination not move although But overnight, also anyone first might

Sam that, I'll to detail. through with talk And and sheet in regions to the balance hand now over greater

XXXX discuss My and to of morning, you, would make like these fourth the key Thank financial this At quarter on points results. good Piers, primarily through of that time, results compared discussion the our everyone. I take will to some quarter and third the results XXXX. focus you quarter-to-quarter up of

entering As Quintin, mentioned recently by we fleet. Swire a the of to acquire announced definitive Offshore Pacific previously agreement

about So the the I will on call. acquisition also provide a bit detail later more

press From net quarter on signs an reported share. $X.XX quarter-over-quarter. release operational morning, million improvement or the $XX.X steady once a this As per perspective, again of we noted loss our filed for we showed of

million The of third we XX% driven capacity XXXX of increase Our active as vessels revenue this was X or our was $XX.X the $XXX.X was the the increase added for vessel million, increase quarter fourth approximately quarter. for count mainly XXXX. by from in quarter

we In in see XX.X% an quarter. did addition, XX.X% increase previous utilization in compared of active the to

per more day increase the to fourth vessels gross our reactivation in for per also from due X QX. an rate QX. Overall, in cost costs and The is third XX%, in quarter operating increase costs Vessel from million million, day XX% these continued saw increase vessels. to quarter associated up nicely day $XX.X the the increased $XX,XXX operating margin of We $X.X quarter to in average was from mainly quarter. overall for with X% $XX,XXX the the

a Reactivation asset impairment million sale category. was into X as of costs held approximately And recorded the moved our we held for active the for quarter we fourth fleet. X from $XX.X asset back quarter we In XXXX, million. to the sale moved category the charge vessel $X.X vessels for

$X.X Angola million a in not We the quarter. did sell to vessel of JV. an loss We related credit also incurred affiliate impairment our

net other proceeds the net have $X.X loss on For million and we year, of and assets the million recorded $XX assets. of sold vessels of sale a XX for these

impairment mainly increase offset by in for in operating the costs, the revenue. the by to and million million from the quarter loss expense Our QX, somewhat $XX due operating increased higher of increase $X.X

of G&A was million, professional decrease $XXX,XXX due $XX.X from the costs for fees. a mainly to quarter lower QX,

quarter expense million. Our for third was annualized $XX G&A the

charges certain we considered However, In charges. QX, Pacific Swire the Offshore for to are the $XXX,XXX fees professional in combination. incurred onetime related quarter

year the million related G&A costs combination. in we beginning million Taking into year of of charges to XXXX $XX professional the for approximately million. $X For $XX.X target against set the was our at XXXX, fees these incurred of effect, the the

At this provide now time, that would like definitive it I the combination to are to Pacific as the information Offshore expectations what agreement. some and Swire relates we have signed a

to expect the We second quarter closing occur XXXX. in of the

to Achieving presentation already of have investor lot initial of synergies, results. of will a be process G&A done the noted the to work company, the principally through $XX the we We million will synergies $XX of million diligence fine-tune on important. the immediately our the understand structure but begin

we GulfMark a So went the will in same crucial complete. this mirroring through process Tidewater to I process as the time the next these few the see we be acquisition weeks and begin prepare integration once is merger.

the for run million. companies closing G&A may was $XXX after first transaction. was of And recall combined below You year, the that the the rate at $XXX that cost both million

achieve Africa Our and synergies. we currently we us as Southeast areas anticipate is will which like be to there where in over G&A Asia support maximize no slightly infrastructure the to opportunity in where run Middle at this be have the East see The current be significant, combined is area. closing. do will I costs the in G&A G&A rate overlap, $XX goal adding $XXX million million considering would synergies is to

will we that achieve similar our confident combination. previous as are results in We

is Also, another cost $X million to as previously, in professional is the spent the mentioned fees. XXXX, complete them. in as in combinations, we all million see associated cost Through a there I case transaction. December with $X have XX,

addition, $X include [ lease another could integration costs, termination $XX noted ] such bonuses million as to costs, state and This spend severance In performance bonuses. items to will we achieve million synergies.

drydock third drydock heavy $X.X we incurred with drydock days. a to quarter, in was quarter million the compared QX. in XXX $XX.X million QX In cost deferred

vessels, drydocks for We the million $XX heavy of now another drydock we the of million. some XXXX incurred the $XX.X scheduled anticipate costs the in to to be approximately continue be year As as costs full we had year year half full drydock year. to materializing first reactivate see XXXX we and in XXXX. We are

and In the asset The capital vessels expenditures built positive cash flow, of incurred the a down to being also was for cash positive, quarter, from we battery $X.X of related full X purchase pack $X operation. X was million for we tugboats And spend of our from were prior once trend again a about no the year flow million. free drydock the this Free even to high in in lower payment due quarter, Angola The million of achieved quarter our activity. $X.X continuing cash of was flow, positive achievement. though free than proceeds quarters sales. the primarily there as XXXX

is the that faced challenges for remarkable which was the year. throughout $XX million, XX considering last flow a achievement Free months were the cash

We expect cash flow to continue the to generate in free future. positive

to X to we upcoming say we've balance However, it at XX. in $X from over next that impact reactivation pleased the the million talked will $XX calls, and related quarter Pemex. quarters. challenges the quite time. about a of AR the lot drydock decreased lowest collection million their balance I'm previous costs at to some seen December On This beginning is

the to kept to ensure will can levels be Our balance dialogue open going with remain forward. these them continue at

at XX In of XXXX, XXXX. XXXX, At we we vessels, and XX equipment the of reclassified to we sale. for balance sold and property end added vessels. held QX vessels we from time, the began on assets that XX In sheet balance another our reclassifying XX, leaving

vessels reactivated to them vessels, the to X X we quarters first During active added X fleet. X back category transferred the vessels of sold XXXX, and and the

of the leaving QX, completed and offering fleet, and we the November we $XXX XX, for sale. added for $XX.X category transferred XXXX vessel amount value us book an X held On million vessel vessels The December back In XX, with vessels these notes. aggregate to reactivated vessels XXXX, of the XXXX. XX at principal to was X million

corporate of were the Troms proceeds at purposes, fees and extinguishment expenses to bonds due We X% the incurred $XX.X from to and on this to costs an actions related in including debt foregoing used price placed general resulting net offshore with redeem issue in the senior the expense offering for connection million discharge our transaction. debt and notes The recognized loss from privately XX.X%. and XXXX, an

capital XX, debt, matures precedence provides The takes DNB facility credit Bank. a credit other for credit agreement November $XX and working secured the facility XXXX is XXXX, facility. is agreement. over the if shared owned and No XX, been by be November revolving have amounts XXXX, in drawn on All into same agreement credit agreement secures with credit super we such priorities all On drawn. notes, entered The million collateral and this senior with general intercreditor the on established amounts collateral that facility the facility accordance in purposes. when agreement the under to

of $X.XXX November transactions Also restricted stock $XXX.X XXXX, financing XX, $XXX.X of to long-term to having par be agreement, million may We offering XX, time XXXX, of per we to offer up capital total at million December into to common and sell on including $XX these of which from and an shares we time $X price hand, up neutral, share, of cash million. on value our also had liquidity cash million. aggregate we and of pursuant entered at-the-market sales an set

This quarter, matured the did reclass November, we the back occur offering to of completed reversed, was our noncurrent notes the in was long-term has reflecting that sheet secured reclass reclassify third quarter since XXXX. prior on our our been notes a temporary balance the accounting may from the filing to in third Since note senior as funding current balance You senior recall in not senior new notes in the debt. did XX-Q. Form us the August

now the would I performance to focus like of the on regions.

QX. in an of to revenue $XX,XXX Americas vessels prior rates in operating crew was area which also for supplies reactivated reported from million the QX operating to The Active increase the quarter loss The in Day compared an increase utilization costs $XX.X loss and XXXX. operated vessels to did to primarily period, in million $XX,XXX XXXX. of from in as of not vessels contracts Our early were region million in day costs for and in which million QX. the quarter per was loss their operating reported of the unchanged increase -- the in $X.X $X.X higher until to quarter, area was The $XX,XXX increased XX QX. XX%, the QX an operating due day compared operating related X was begin $XX.X from quarter.

custom year's legal We for related court also Brazil. in accrued claim to prior charges a

Our was Middle The area utilization current approximately as of in operating quarter, Pacific income million same which to million $XXX,XXX to $X.X revenue $X.X an million income also reported Asia compared quarter-over-quarter. vessels, XX.X% QX. of in X $XX.X was increase of in the East, did area points the QX. in Active XX area increase quarter operated to operating XX% of by reported QX. which percentage compared the The

to lower compared and freight The QX increase costs. in to day operating QX. operating per $X,XXX in operating due revenue, with income day at lower to constant in supplies remain due $X,XXX per rates coupled higher costs is day However,

Our Europe slight million quarter, area $XX.X in vessels to of an active XX $X.X We QX. operating the by loss X% QX. vessels increase which was of compared million to $XX.X region an and in utilization compared saw operated decrease Mediterranean million of X revenue reported in did million operating see in increase QX operating in loss We reactivation did and mainly XX.X% to operation loss X $X to increase quarter from vessels a by an The day QX the the costs increase in the due QX. in driven the rates per day to bit QX. The of in operating in to and per additional day compared was mainly for in $XX,XXX compared XX% uptick $XX,XXX to quarter. to a

QX. region operating Africa of vessels reported QX quarter West as this $X.X Revenue was in operating Our $XX.X in area remained million at market X for compared in and loss QX we've every QX. in steadily year. throughout to active flat of improved million area increase utilization XX.X% decrease rates from per operated The The the million has to to the in loss $XX.X in $X.X loss QX. day in compared revenue seen to more compared QX in Day an year QX, increased million an the XX.X% The in QX per mainly increase in $X,XXX from from X% resulted day $X,XXX operating QX. QX and glad in in by We're operating somewhat in see vessels the region. to of quarter-over-quarter revenue, costs due reactivation to additional increase the for quarter. X offset operation the results the improvement in

in our us for purchase Angola. the million, in control XX% interest purchased operations area. our $XX.X joint venture subsequent to that which in of full we was The will allow Also Sonatide, business partner's year-end,

increase encouraged have XXXX, see XX are our in continued signs impact vessels and rates in in results. utilization, we're in see summary, revenue, and we encouraged We did an market which to operational reactivated to activity. day In positive the

will the will operating a benefit will level. in grow continue costs of soon, and continue stabilize as to to And we XXXX. normal those Reactivations full begin revenue see reactivations to

this So reactivations the signs some with forward and we beyond. through remain see P&L, look being XXXX positive costs continue in been vessels to We have -- done is but are contracts encouraged very for positive look and the where to these will continue additional on all secured. this run as

the Swire a The key [indiscernible] -- high-quality strong will acquisition to a growing be commercial to in brings fleet a team, of company. prove and Pacific value Swire growing position an the important great markets. Offshore

world-leading to an We work and and company. create are and very excited eager OSV together exciting

X-K purchase the Form filed will share Shortly, for a see agreement. you signed

general will and will financial related On Form the target's historical include the of we a to to X-K/A Form information. pro X-K, a file XX information file of days close. completion that then statements forma the We acquisition, date have financial including

warrants as is issued the will in a statement that the Our after acquisition practical this soon be intent so file as filing. to information included registration for

will turn I to now that, With it back over Quintin.

Thank you, Sam.

free at vessel this lowest Our are at positioning achieving while plans our cost requires optimal do G&A this and geared rates, to capital technology, and discipline. by and increasing investments. all cash compensation our management agile the to flow geographically capital per per continuously cost to objectives free the objective operating But vessels highest the strong These is possible positive, cash most are cash and simply operate obtain flow. the to generate is them carefully doing minding increasing and day objectives company innovative them expenditure free change The financial working flow vessel. We're stated.

And with that, for Alex, we will up open it questions.

currently [Operator have no questions. Instructions] We

will Quintin any I hand remarks. closing So to back for

you, the Thank listening thank appreciate Alex. Wonderful. you impromptu in. Everyone, We call. you conference for

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