Tidewater (TDW) 8 Aug 232023 Q2 Earnings call transcript

Thank you for standing by. My name is Ian, and I will be your conference operator today. At this time, I would like to welcome everyone to the Tidewater Inc. Q2 2023 Earnings Call. [Operator Instructions].

hand Finance over and to Vice West like of President Investor would the to call Gotcher, I Relations.

You may begin your conference.

Good Conference Officer, on Officer, Sam Ian. QX Piers CEO, Quintin by Middleton. you, morning, and Chief welcome and and Thank Financial our to our XXXX President Earnings call our Call. the joined Rubio; Kneen; I'm this morning everyone, Tidewater's Chief Commercial

and be call tdw.com at or as may of GAAP both non-GAAP during and uncertainties we'll on reconciliation SEC stated materially make release. conference Information August call, at other performance factors. longer There A available of are certain referring forward-looking our time-sensitive comment call. sec.gov. non-GAAP through replay. any to recent on These financial that call, website any are expectations. the actual today's to on our time today's XXXX. may accurate During you're be at at any advised are speaks different that refer no that of risks making and details today, and our information on factors that company's Also financial in only our most the the X, Therefore, cause measures during measures. and GAAP yesterday's XX-Q and or plans statements press these implied Please and website present from the Form that documents we by we'll XX-K be can tdw.com to found are included to this is additional for presented

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

Second Conference morning, Good everyone, the Quarter Tidewater XXXX Earnings Wes. Call. you, and welcome Thank to

quarterly from and reiterate to wanted over and Offshore, allocation. Sam expiration, results, on PSVs discuss briefly our the results specification our XX related the to review Solstad recent to turn our warrant philosophy discuss call I capital of integration I the of Before high to Piers the that,

prove acquisition shareholders vessel to after last Tidewater largely and of the will accretive generate the the We end the of that continues. quarter. announced as on meaningful coming be Solstad second X fleet it the will shortly addition July We from years completion to fleet This for offshore an X, this the asset cycle is in acquisition value acquisition. different is the up an over the our believe

we staff up of operational the have into shore-based Tidewater vessel and to transfer were vessels infrastructure. existing the So closing the ensure to prepare had to poised the staff the operations accept the of administrative and ahead

lower, assets error few of of day that convert much start to type that of the the to to have resources margin the assets the and to get as avoid the we negative the downsizing to and earlier from systems much we have preparing of operational aspect control is we this and period, of existing is acquisition and and aspect get Tidewater you framework we layoffs, is are positive an But moving infrastructure. the full assume amount The incremental redundancies. over shore-based a assume, importing

X transitioned maintaining vessels we per-vessel Integrations have XX low the by over in report our infrastructure of integrations transferred vessels to overhead We seriously. are I'm pleased quarter. all our is our processes accordingly, critical first remaining and our scalable the expense. already feel to plan that are very have fourth we and take to global days. transition the working, our And

then received the restructuring a as We months. proceeds working expired week of we from equity acquisitions in be then ago integrated money. worked million up two as an about last a issuer saw state about closing, what business. XXXX warrants issued first We X.X termed over acquisition spike quarter million shares. might new X you the $XXX expense The of steady the see new became in the to and a the one, beginning inadvertent the down This our ramp-up of full ahead and G&A and

All of the shares issued were actual common Act Jones shares, no warrants.

ample any to remnant warrants. we're is outstanding, warrants. Act of Jones ownership actual them have still no Act to listening shares and Jones for need have Jones so common to there Incidentally, longer we maintain U.S. We warrants who a now, convert anyone Act glad holds

issuing that philosophical On value But a these equity pleased otherwise warrants. from to willingly holders were would Tidewater obtain basis, I'm be the incremental not shares. pre-restructuring we able

now So have million our the interest as best an additional we to of allocate $XXX a shareholders. result, in

to we've less be similar commoditized, West position it As and PSVs assets U.S. offshore to would that would anchor always large essentially the like of that that relates in well, in is our first allocation sense value fit, X as Other energy-related OSVs somewhat support act large price global our wouldn't the and to accretive considered done, handlers. -- are to diversification, but acquisitions, are last being the Hemisphere, cetera. other fit allocation, capital Brazil. they which Far from need make perspective the we underrepresented Strategically, are the that et existing

are make right at of the But value. the right with XXX money acquisitions. geographies more tremendous said, can with vessels we a to do price, any we vessels these more probably But absolutely create with that slightly need have. certainly amount in favored. candidates don't now all So the we We can

would on best memory, looking recent not Frankly, we on the shareholders. return I'm but associated to than and cash negative seek to have ways cash to M&A, our value-accretive in to hold money more still Absent carry. making we the we're the money

X appropriate this capital until is be measured any need returns to me, secured for direction And capital us another structure November of the strides that current of year, returns the to acquisition ample a until bond long-dated secured Also, a recent that frankly, make accordingly. revolver, over debt debt that could is an capital few can we staggered is financing have reset of Our step is business. give in in belief quarters. of scale would cyclical bond precludes and now. direction. To capital unsecured about combination maturity our appropriate we months a and from the a any debt that next structure My that further quite XX

Lastly, filing Form week. on be matters, we an updated capital S-X will this

shelf for This prepares expired. universal like Tidewater of procedure ago. and the potential a is any us issuer a has opportunities standard alluded seasoned a previous moment for well-known Our to acquisition we

is since second the recovery every the positive around a XXXX. of sequentially, business, a XX% second BHP-class significant the began during class sequentially. upward The the rate modest experienced the increases to in now vessel our quite Every and end day its quarter, rate The of movement. offshore our strength the region X,XXX quarter second rate up with continued average day day exception The in which important the indicator with was momentum flat XX,XXX per approximately nearly day another of rate, period day most average average anchor $X,XXX $X,XXX handlers, up market. were quarter, during vessel per essentially to day

first revenue second to expanded to For percentage the million day XX% $XXX X quarter. increased during to XX%. quarter, the to quarter, in cash Average Vessel about rates first million points continued compared full second the Leading-edge right quarter. day rate level at margin the $XXX XX% XX% up over about up improve sequentially. was

first on we $XX,XXX average compares $XX,XXX was subset per rate second about with the average is increase of in entered right XX% with margin months in factor day with growth X.X potential of the leading-edge our of day confidence an the duration for The $XX,XXX quarter. the vessels. An average is and at rate contracts for average X.X a an day XXXX. of for leading-edge associated into composite term day Further, day quarter, average a months. day meaningful. vessels to for in approximately During of the XX above contracts rate duration continues This revenue be second for And the XX% outlook optimistic leading-edge the and day the to our quarter. year gross guidance rate rates driving this per

our at frequently, increasing profitability driver long-term we As particularly the to offshore intermediate primary cycle as of discussed we've improvement rate business, unfolding. day of is the look

pursue tactics And globally. higher cases, continue projects We continue we waiting strategy customers on have this commence. immediate certain variety day frictional strategy million contracts focused forego and a a rates. during to chose remain consciously vessels in second impact. relocating opportunities. tactics global some quarter. utilization rates combined short-term on rate the our for to push to in opportunity successful was $X incurred from This The revenue drive unemployment As to such, to utilization did to were for day related average loss approximately of to we to day cost We to

The billion compared reiterate even anticipate the and $XXX term, we higher but annual of $X not right chartering guidance to are We for the day intermediate XXXX operating revenue progress baseline to Solstad revenue through in fourth beneficial the are certain million inclusive Both PSVs. to this $XX an the the quarter. to that rates newly we to in 'XX additional second into QX that of second in with of will utilization vessels quarter short of and realized for business, revenue prove we and this confidence We the the and the of from push gives of increase is acquired the achieved in $XX only approximately of margin, remainder day the us as beyond. million million our day confident by continue improvement long-term and profitability rates strategy figures strategy impact the increase quarter. for rates as XXXX

revenue to utilization. have utilization a the is assuming our a utilization. for and repair, coverage, To less have at usually that our XX%. Embedded contracted. for guidance expected in downside The backlog up are step vessel quarter, provide that being third guidance. But the from we in we to off-hire That's the capacity currently a work backlog coverage additional XX% fleet XX% where XX% that, we some utilization. relative of to lose contracted And anticipated is we with risk revenue than XXX% context reasons, is nice for

momentum with In XXXX performance over summary, company's outlook classes Piers and that, across on very beyond. the to continued call an regions let the the And me turn vessel within. and second with global remain pleased markets during for our quarter, highly we constructive of and are we the the the overview and for

Quintin, everyone. you, morning, good Thank and

are gives seeing we a industry for Tidewater in Before our area's to our the happening outlook the about I the in that long-term focus performance, what necessary industry. us I on confidence talk at want little

positive operators resilient energy capacity to fuel Our by as exploration for teams source regionally and and energy vessel recognition being investment return of all into respective seeking to is global appraisal very offshore demand outlook the supply-demand and the of markets, part Offshore their critical output. bolstered production momentum see Offshore a security with a as driven is energy long-cycle transition. by gas positive. supportive and the developments, the offshore rig remain profits strong, in continue oil reinvest of and prices, increasing GAAP markets expansions, and

oil gas full year-to-date, Overall, research billion XXXX level $XX And of been for furthermore, expected is sanctioned by spending other highest spending to estimated increase the in projects year, forecasted offshore CapEx projecting out has with billion E&P XXXX. this the a XXXX. with rate $XXX since and with outside annual XX% vessel increase of to research growth resources XX% to compound year,

in As X of the planning and estimated abandoned in market, revive huge this FID XXXX, which billion to Kaskida, are they The than announced Oil more Gulf, the in revival the XXXX BP newfound long-term project, of of hold in evidence they is the to the First targeting now offshore reservoir some oil. U.S. and barrels has in XXXX. project, confidence of

agreed to the XXXX, by now of up compared driven index their Rig recent rate supply to heading reduced at sector harsh of June $XXX,XXX XX% floater competition beginning and by environment a with fixture floater Clarksons rig per harsh for further that reporting continue tightness a firm, in sector, for day X with rates strong for is Australia, units the primarily globally. in harsh sign Research semi the amidst

utilization XX% multiple very year the will XXXX, jack-up floater space. market long-term and XXXX. that be positive XXX% utilization industry market hit next of into outlets and health various the forecast by will that the All indicators for OSV Additionally, at the

back to Korea. in various X leading a outside To rig up in for the South provider global their intend a offshore purchase currently recently recent options sitting disclosed they floaters now reports, exercise yard research that

not based fleet As is rigs it strong current outlook, the to interest most, supply sees that new their drillships on if global needed the and meet stacked the market demand. said and build their company will enough growth expectation future be in of growing customer and that and all, the is

the time significant milestone: the reports year-end a for bodes which projects contractors of also QX when reveal leading demand many side, X-year surpasses their of completion. to combined demand a industry, before XXXX reported that frame now well from the the these on EPC Lastly, long-term have X record X- backlog, generally backlog

uncertainties very a said of XX% new long-term of years, returning up there the level of In and supply overseas new for to time. activity addition, with on kind more as and cost-intensive, industry up research, in and is we design set to still is little to the finance, sign technology, rates surrounding these many build challenges due build any remain some vessel on securing horizon reactivation to leading time- pricing have calls, and According and of building economics. day the high new not support X been constrained have times increasingly than remaining lay laid becoming to for

remain market customers we comes believe, started now when some to we clauses, customers terms. movement from to very for clauses the in contract see for Again, termination have positive positive for with momentum, of the to no return long-term it longer-term some very And cancellation and convenience in health contracts. willing particular, the our industry. overall, for significant discussing So accept

demand to we a still in day as on prior up rates slight even utilization by down compared managed day over fleet by push the to QX, impact our quarter. in on composite QX, the see saw team own though $X,XXX compared we rate And per in Quintin, to tick upside. supply to the continue the mentioned fleet. to shortness Moving And positively in increase our and

per rates of a XXXX Norway The net our QX sluggish jump PSVs, did saw U.K. $X,XXX of older through and both our was sluggishness off U.K. to out the we various whilst slightly starting in PSV to improved offset the of continued QX, per of in vessel. U.K. and rates team regions we market uptick which Working fleet per Europe, roll coming $XX,XXX across little to to see class from the with day QX, market the demand our any We composite newer day day, in $XX,XXX the in contracts. in per of have QX into compared QX day some a in significant PSVs was $X,XXX this Whilst region. whole slow, contracts compared medium-sized a strong

day. vessels of rates excess Med, larger the class we for also day saw In our in leading-edge of reach $XX,XXX per

the the we our back region On the in larger in the mobilized X of into AHTSs have summer advantage remains and robust large expectation in $XX,XXX AHTS region to finished she that X pick had to to remained in Africa, $XX,XXX in the after side, work project with the North take have up day AHTS of strong still intention the the will range, rates traditionally season Sea. per QX. And demand

improved for We the Africa. to requirements in QX most QX rate to per our again, square XXXX, class anchor by PSV. $XX,XXX per and day in day, the larger improvement Angola, to tender XX-year ongoing region. across X focus continent, support to see out plus-XXX have to handlers BHP-class recently demand in rig meter Moving day $XX,XXX their seen up in In of again particular with plans fleet rising Namibia, coming XXXX, XX,XXX $X,XXX quarter, continue rate composite and the from the and Senegal, Congo come the whole floating with from of per day

of off to the also below-market the with had of half a also legacy PSVs our in made per to levels. operations to where able day number rates the in class into Arabia, Middle first large be $XX,XXX of our new East the vessels AHTSs region better day X,XXX we'll of year, for mobilize medium support and out the forward. rolling of and Saudi achieve margin going leading-edge we contracts excess of decision X,XXX We to contracts and to several utilization much BHP-class smaller In of this

Africa be but whilst overall of transfer AHTS to continue we also big the to provide Alicats customers long-term new did region we During in in boat to convenience PSV pain clear, X And of take continent. commit fleet the To utilization short-term very will region primarily for against the our for the still services focus be going is large right remain numbers, first time for supplier We and crude for some gain. growing positive vessels main relocation quarter, had our the forward. on choice a impact region building the negative to be our the X to our of to in believe it this contracts.

XXXX. X in other to Kingdom the fantastic record $XX,XXX East job increased stands additional remains compared at with competition-wise, total XXX units, rates and composite PSVs Middle $X,XXX did as Saudi for we dominant not as number rates of improving utilization as X remains day focus and the And of rig areas fleet per by smaller the for region most robust for class to well rate areas region to the per X% QX East, in our an the currently just XXXX. take key Jack-up our you team these of of to just Middle made the the advantage the in per of consistent our the day from pushing projected able of day grow our but of In mobilize AHTSs QX country QX the mentioned, and in smaller a country in East in decision as to of challenging in the Arabia achieve regions. day Middle I other the a In to $XXX fleet. XXXX demand rest a in to demand vessels, the are importantly,

up contracts. QX, last new demand per reported the Brazil offered to saw awarded In PSV were XX Petrobras, excess in lot in And in to NOC QX levels market larger PSVs. in being for this from the with of Americas, $XX,XXX reported we rates day that as sources a have all for of tender quarter, mentioned

In when addition, additional the contracts expected tender a up for from large is country to start is the outside long-term supply and Petrobras to shortly, AHTS out expected in XXXX. come suck which with QX QX of

our and up we region, also the to strongly, other half rates fleet in continued of have see a the Elsewhere as the during strong market we of year. large continue but contracts uptick Americas contracts to perform on boat the in in see And U.S. we previous Gulf quarter. pick as of Guyana Mexico quarter didn't In areas, the have a QX in we to XXXX, in the Suriname steam saw first some huge big the as didn't in working quarter. a we start rollover continued new

coming rates push in up However, the team to class, $XX,XXX able fleet was XXXX. day. by per in still day per excess QX day in $XX,XXX majority The $XX,XXX managed achieve to the the composite of day uptick the also per from in large of per XXXX leading-edge to $XXX day where we PSV QX rates

PSVs. the going choice mentioned, the Lastly, demand the Malaysia, QX in support to forward and with year as demand for are XXXX. continue being customers AHTS East and large and into XXXX, move same countries able of best the the Taiwan supplier large our Middle expect by in drivers of rest Australia market, to the previously our being we did for bigger region where smaller in and boat those the region focus through on Pacific, the the we be AHTSs We key in Asia X the reasons of of to drive for

rates in to by the per in region increase to first managed the QX $XX,XXX $XX,XXX rates up impressive per a across of team performance Asia even the the from the QX and composite In day QX All $XXX and continued to day XXXX. very XXXX all, the day per year. for region half in quarter XXXX sustain the impressive Pacific in

the are into continue demand that year, direction the we move we Quintin, and positive with throughout the right how has to operate. and by to in continued expect significant mentioned we over as momentum to And any you. signs regions Overall, with slowdown that, in in subsequent market all that in pleased hand quarters very any being not of the Thank which I'll Sam. we beyond, that with do see

of morning, to prior second quarter primarily good would time, results, the on and At you, quarters, of through Piers, of to this financial in compared I Thank the first like you XXXX focus as quarter-to-quarter and take quarter XXXX. will the our everyone. I results

or utilization $XXX on current higher to the press for the in Active of the on first to our $XXX.X $X.XX million release is in net higher compared mobilization to income quarter $X.XX $XX.X vessels income quarter. quarter. in the million days of to revenue. we filed mobilize noted share quarter per As or X $XX.X drydock as different decrease decreased yesterday, net slightly QX reported of primarily in due share XX.X% from million million in days per second The XX.X% regions we in revenue and

million for travel vessels. revenue. to in Average second crew day saw million in Adjusted compared increase EBITDA in expenses per QX, to in compared million was related million QX. an million quarter the day rates million increased supply margin to percentage of increase reactivation in $XX.X in expenses QX by of a and In $XXX.X from and vessel the the X.X% to operating from in costs main was Vessel QX. day $XX,XXX and were vessel $XXX.X in $XX,XXX in to salaries $XX.X $XX.X increased to compared driver the XX.X% the margin for quarter the XX.X% quarter, was quarter, QX. we first couple QX Vessel in per $XX which

due to In drydock to addition, regions into operating incurred costs, we fuel and as X different the days consumed. previously, increase that vessels quarter additional mentioned in the in the mainly added mobilized

cost the onetime related and to at that costs day operating a our in vessel per per charges operating about estimate We relatively about costs affected flat quarter-over-quarter day. by of couple $XX.XX mobilizations day. was quarter per $XXX Our fuel

margin from acquired with be total revenues the the X approximately sold we newly estimate of vessel $X.XX to on operating the the our vessels, Solstad remainder quarter, assets most recent addition year, we the XX sale sale and for of million gain from of vessels. for and proceeds We is $XX.X XXXX operating of the a higher these to The income active $X.X of billion the to forecast quarter $XX.X XXXX approximately X for on million look QX. second and primarily million and million we noncore based to increase net held vessels, reported net As of X million. be $XXX to due fleet In of $X.X our compared the generated the revenue. older in

the million G&A expense to million, the was quarter QX. $X.X be uncollectible. G&A included cost bad for in $XX quarter that determined $X.X second a higher balance for related receivable than million was debt to customer's

to also In related $X.X incurred acquisition. the vessel expenses in addition, million Solstad we transaction

We $X.X transaction to acquisition includes total $X.X costs million costs which of to $XX the G&A million Solstad mentioned approximately bad vessel expect debt XXXX previously. for be related and our million, the expense

which Excluding part includes as annual Solstad the these be about to anticipate added normal $XX costs million, G&A additional items, our of rate run transaction. we

deferred million cost utilization by QX. $XX.X compared the quarter, drydock incurred In to we affected which incurred In days, quarter, X%. we in XXX in drydock the million $XX.X

in addition million, which also of drydock and includes be million modifications. capital $X.X for vessel million Solstad expenditures the now we related to upgrades about With vessels. to QX, year the IT In we related Solstad the our estimate incurred to the XXXX full $X costs $XX vessels,

Alicats. In to addition, on million new we incurred X $X.X related downpayments

incur our been which to by in million expect capital expenditures, $XX we customers. million reimbursed XXXX, has year full approximately $X the of For

cash million $XX.X free this of flow We quarter. generated

in grow cash Solstad million vessels affected expect by approximately to million and as almost investment by and $XX though continue as addition of will investment QX As even to the we manage we revenue taxes. expenditures, capital in possible. CapEx capital our flow as higher flow And primarily increased as -- $XX increases, do paid drydock the quarter. for in also cash was working we with tightly this Working

a did CapEx significant we spend quarter. anticipated, in and see this drydocks As

the However, to improvements we as accelerate. QX, improve flow to additional in performance cash QX the in continues with significantly business expect

of on QX sheet we vessels held reclassifying to XXXX, from sale. equipment In balance property began our for and assets

through have We we the value since this vessels sale XX X assets At about at in of remaining XXXX, of a vessels for had run QX $XXX,XXX. end held program.

During a sale $XXX,XXX. quarter, mentioned sold X the million July a Solstad previously, of combination from for On we the from from $XXX for proceeds as of of X-year the a acquisition net vessel vessels for completed held We unsecured platform financed assets through new second the we X, fixed supply bond, term, rate in million, our Form X-year secured the the pleased million. sulfur-linked proceeds $XXX $XXX acquisition of together More available Nordic recently We're are and floating-rate senior XX with cash. million $XX.X of XX-Q. details financing filed amortizing very bank with anticipate acquisition, and fourth into XX received completion and operational we We markets. our we the the to appreciate from forward by the management the look credit support integrating vessels the quarter. the

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

from increased to higher vessel due slightly was than The operating the utilization day per bad X in of of expenses million of region in XX.X% region in operating QX. region rates increase quarter in was Active an The operated $XX.X $X.X in quarter. quarter taken operating to QX. XX.X%, to of Americas $XX,XXX active QX. for QX the reactivation primarily QX The $XX.X margin increased profit and from debt compared XX.X%. $X in million $X.X quarter, increased vessels QX income compared to decline QX. for profit reported million Vessel operating million in from the in XX XX.X% charge revenue million X.X% the the Day in Our to XXXX. reported $XX,XXX

from to up in in was second The utilization region compared compared compared average reported to quarter, an quarter in revenue XX XX.X% profit margin of operating vessel XX.X% $XX vessels, XX.X% to QX. in $XX.X For of the compared prior the the $X region Active operating The million QX. Asia quarter. operating increased to second XX%. to in operated of X Pacific region which reported profit quarter $X.X QX. Vessel the active million in decreased an on QX million the million to

in in coupled day operating to QX However, day decreases in compared in day income G&A $XX,XXX is the due rates operating increased increase by to The with X.X% QX. higher expenses. revenue, per per $XX,XXX from and

an million second XX% the utilization For The an margin quarter, of compared in the $X.X Vessel loss the revenue East of quarter. first of from an to region to XX.X%. QX. $XXX,XXX from region second decreased compared quarter $XX.X vessels, vessels XX% X decreased QX, in to The XX.X% million higher million operating of Day operated days the prior Active region day X vessel operating rates operating per in from Middle The reported mobilization in reported in $X,XXX in quarter operating which to The was the over QX. in loss impacted due incurred $XX.X XX region income increase expenses, per increase area. to fuel operating higher in into increased transferred mobilizations from due substantially, to in the mobilization quarter, particular, the days. into as the region. $XX,XXX expense, XXX primarily QX resulting the to mainly QX. decrease the in in utilization were from day

operating margin and lower reported utilization to XX nice increase $XX.X in of million in Mediterranean and $XX.X operated the due reduced. impact compared to to increased where the in X Vessel of seasonality QX. QX profit to QX is increase QX, increase from from region XX.X%. primarily Our Revenue in in XX.X% XX.X% to a QX. operating operating as The increased profit utilization million $X.X activity in region million Europe Active compared QX. quarter, in days vessels drydock reported to QX, $X XX.X% the million. and region in increased was the The than less XX%

in The costs rates in $XX,XXX mainly per for QX. by compared operating increase revenue, to quarter to jumped income in day higher addition, higher offset higher R&M and XX.X% the day $XX,XXX the per by day and expenses. was driven consumable increase In to due operating supplies

utilization Vessel XX West Our to reported QX in million strong. in Revenue profit to million in to market $XX.X of QX. increase $XX.X from XX.X% decrease remains increased $XX.X mainly The Africa day in income in area coupled in expenses. The to vessel Active operating a on in with XX.X%. operating QX resulted compared operating continued higher as we in a per increase margin operating region million increase to region $XX,XXX QX. for from $XX.X in the profit in QX. than vessels operating from less was X compared QX. The XX.X% XX.X% from XX.X% QX. operated increased QX, And in day saw this million to average revenue, QX rates of QX

with are affected high overall anticipated different summary, number we a In QX quarter, had results. that repositioned our X of regions drydock our to In pleased vessels and days we results. the

the in a on this However, future. results our have will positive impact

continued to year in are higher by revenue see We day throughout rates. the encouraged driven increases

the many position to During stacked us completed put of in of previously Swire for the continued we remainder stronger take the we encouraged a of see XX now which advantage the our remain leading XXXX will beyond. the indicators of industry. We by upturn in vessels, and XXXX, XX reactivated the in July XXXX, we with purchase legacy Tidewater vessels, transaction. of And acquired vessels all Solstad

over With over to Quintin. back that, I'll turn it

thank we for Well, it why questions? Sam. don't Ian, open you, up

Instructions]. [Operator

Our line first Rollyson is Raymond question James. Jim of the with from

in terms obviously, fleet and day rates average nice of rates. Quintin, move sequential leading-edge average the incremental clearly, a contract

incremental average duration, signed Solstad? of terms front, duration of duration you average the think, the inclusive of today the was X.X us vessels months Can you quarter. remind kind what of On in is the the mentioned, I in fleet

year. one About

fleet, legacy Tidewater the For yes.

on to obviously, obviously, the concerned that same spending they trend? all concerned about starting we Are vessel their in plans imagine change you better, And when I -- incremental have and availability. look about get getting at about look at you from mean, trends spend. to start they Are to customers? tightening guys I and the as for you have are get activity market your the that talked based

kind just by a are how what curious And you booked to So of month -- those quarter this go. conversations your last versus quarter. down went actual duration trying they

if curious going. contracts of they're up trying that longer-duration to just how book kind So conversation and is

Yes.

we It's hand to scarcity. -- him a say is for is to And them. moving behind about scarcity. up, shock in going a worried second. Brazil. and would I'm over rates that it us. 'XX now is are I in went It's period realizes scarcity But fact sticker of Piers that In issue they're everyone through that here in

concerned scarcity. so that are and And are about more those drilling campaigns more active

the So trying going of our but in person starting organization them book it closest We're to still we're to time. see short, longer is to periods Piers.

comment. So to him ask me let

clauses I is Thanks, contract of had. lot of us Yes. we during number term. to mentioned and I spending was of Yes, we back a contracts these they're or or to that allow those strategically, a downturn. I that to And -- companies Quintin. term the on were to the then oil if to contract, commit terms in plan X-year we on think sort I -- think us Hi, in cancellation commit had convenience a also, mean Jim. place push legacy X-year able X-year a time part people lot commit they sort of to roll to getting go of a that going just pushing of of to poor the short for a the full We're a

had we've course terms during that again. accept process, year of to positive this people that So momentum starting of are some the contract types those of

doesn't the they recognizing it if of because customers we're commits want they a that but we're need starting to to who successes worried scarcity certainly -- with are need an that number that to that's have they then about So see to our with X-year they starting to contract that, starting actual to which start to vessels. and support are have happen, a of happen contract, overnight, some

takes So but customer from time, our definitely yes, it seeing base. that we're in movement direction

end. kind out Middle impacts the sounds from And some near-term of and certain sense cost impacts. on of there's utilization relocation vessels and of makes markets your That East, into Quintin, the Yes. obviously, good

a on of XQ. some much steady that maybe benefit still better further And hopefully long drag in perspective? that you think from does and utilization rates you color before Just little how kind the starts to how then

Yes.

and lower-specification boats and that last fact months -- theme the X the is the underlying lowest small these that size your a are like quarter boats, capable the So you've go usually boats. go in East, first a East. really an upfront. So in situation to go work to you've to boats got process, the that a Middle move of Middle But you through Saudization great costs got right? those bunch into for are the them And whole when

in boats to to So first we put most did hit those of in back work, the that that good half it's and QX. of the year,

I I Certainly that that think laid QX, table this is surge chest and out. that in behind think a globally the But have remainder guidance of but resetting we -- nothing all the contemplated not no, reactivation we in small largely at us significant. point.

Great. it Thanks. over I else. for turn will someone

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

little bit was to more contracted comment around get I a fleet. the the around color hoping

around and I on roughly -- XX% questions there's it, the of back function this then of that contracts? guess You the a to mentioned Or are vessels that's is And off this piece longer hey, vessels contracted. color are going our trading is is fleet a rolling going how to be doing? little those us are provide those be natural and markets could going spot could, if of around contracts, you just simply fleet in spot. you where

the are as of rolling go got you've the most to those be spot next think right quarters. out in it laid sense through market through the I several No, going we Yes. that

give it spot to most world. market to over the Piers you active of where the Let around is me idea an give

Quintin North I of of right, Yes. spot element as Sea, the way have anchor of set the year. we you level there's -- you, Hi, said, up, Quintin. Thank availability. certain mean, obviously, so you that handlers spot sort -- I exposure, you always half second Greg. in mean have larger that's of particularly the into as the guessed on an go a it we Yes. No, the

up market very -- holding positive. It's seeing also We're still there. some that well. is very there's So

I with market, transaction is largest good but actually The PSV Solstad in be share our as competitors the side holding news, the to have rates seem we that on think, well.

over So contracts QX certain is in momentum that in we're rolling piece is the spot. again, as that's But very well. then positive number a a And to North Africa. level -- turning in QX seeing off in and which of Sea,

few down contracts So there's a there.

world. And we're the pretty otherwise, then everywhere else busy in

exposure is working. a -- little amount a So well, as huge bit spot in of of otherwise, Asia everything not else but

mainly the of exposure on we So the side. is out Sea most where of North spot see that

talk Okay. fleet. Great. want about -- did then just a little I the And Solstad bit to

to fleet any think those think each What hundred to is vessel basis? integrated are vessels right? kind cost, about to Is of is in our of it. the a we were the these of mentioned West Is -- is Brazil we in. grand? but you of as already Brazil, of integrated it are it to way it on reposition we that the -- You fleet a of in that fleet we you vessels recent the integrate kind kind X and out some we to are the are on in stay ebbs be concentration last heavy and a down about the about curious Solstad North I Africa. vessels remainder the and guess Sea, as mean, expect that, there down decision -- quarter that as is into just East. it and can I couple about of think going position basically put? flows figure there that fleet, to -- being realizing there? kind in still boost from you're Middle then the that kind touched the the think you if put there's vessels there to trying Just vessels vessel mentioned And given Or in,

timing of I it maybe is comment it's on to the these Quintin to to a we over relates stuff $XX,XXX But anything it it's than far boats, boat This days take day, Sam. because and change everything that like a us will $XX,XXX this. the integrating switch maybe do. It systems can to Greg. going cost would I'll and say that got else. documents off, just kick and then Hi, to X.X But of as more of really add that. as all X Greg.

the So cost. is as far as the minimal, timing impact the and

the from the of year result, your that, stand-alone fleet, G&A that for increased guidance Tidewater about... Now I'd top you've as layer Sam, a on

go anticipating full year. a about That's for up G&A correct. We're to

So...

$X million.

$X.X million year. I mean, million should sorry, this year, the for I'm which full the $X second for half about be

-- intensive incremental just over vessels the the actual shore-based planning really it's movement intense But facilities. but that's an exercise, And a an cost. of not the is it's

cost. Not correct. an intense That's

given those them the located, should what thinking mean, is vessels, I just they where outlooks then And we we be tell? just about to Or when were too [indiscernible]? early for acquired it

fleet, to But on of now, over them of next year, can. them like I that most are right them going little I bad think the over news in I to they're than news, is under see faster the currently so the you're -- working areas which -- the bit a good really because It's contract, roll so kind would where at.

to are a the new at in that about slug the today, they're and X So or Sea, with that biggest And handful just Africa. Brazil, I'm on in they're got is in the we've in a is handful anticipated. we optimistic better X than West certainly, Australia thing but North where contracts fleet rolling that actually

So from I'm a that. with standpoint, analysis really merger pleased

anticipate where sector area it pulling opportunity of is always I'm is has think tonnage. over tonnage. up And operator. real out the Mediterranean, if that, of concerned into I then there's in down as Brazil been the not I'm for more for that I a years. lightens And this well more expect tonnage, This although couple next in them flag on them a international go. this recently rolling working the where does Africa, to which -- at point, U.K. an is strong very foreign it Now West I Brazilian as Brazil don't is a troubling Brazil Brazilian

the Clarksons Securities. Your with Fredrik of line question comes from Stene next

of in relation wanted themes you hear to to actually a Greg contracted me. can the I to some touched upon that guys capacity. revert bit Hopefully,

what's interested what's terms give fourth left of play the capacity in some but You've booked third Are us of on also forward, the numbers in given happening the color us And to both going the and XXXX? markets. in able also for be in quarter to you I'd revenue free you what quarter.

Sure.

fill. little have we bit happens what space, quarter naturally, white is as a called, as out So each little you more commonly bit a been it's look to more room,

filled about so And the fourth quarter. XX% we're for

XXX%. over And until is similar down fill on this get quarter into to you then But level we're as that you which go a 'XX about the out it so work white as the same to reserve it's And up space, step that quarters. QX, in -- do to in I'll through we overview. we'll talking 'XX go the

that of helpful. can is to start QX that towards a large you terms work come subsegments correct rates, in right been the to I with basis has us a -- in assets? you've longer-term has of of kind And you've strategy general if the just of point holding kind comp. on short commented but you're flow truly misunderstanding, your be it there visibility some about, cash timing Okay. believe talked to to your changed, would how Anything capacity from strategy degree? long Or of your help a longer that attitude or on a for it's are as that you to bit now it get a the feeling on secure time to a where strategy, on go that

and are back. I'm nothing really magnitude day to optimistic I in My still There's holding in coming And rates continuing activity any anywhere, globally. it of changed. No. no really incremental hasn't attitude very from see increase. the levels acceleration supply of

generally, So going still short. I'm

our so of a for going Now coverage. we've lot we're long been depleting that actually short

may some add just if longer-term to we balance contracts you will. out book, So the

piece always long-term of So a there's contracts. meaningful -- because

it. terms, the druthers, to right you so can to price let live my I the he's spot But hand market. If But it right just and over forth. on and I'd had me jam it get if got get Piers, the if can escalations you with I

ask him well. I'll So to comment as

right we are I I contract. little a commit bit can earlier, I to mean, mean, I strategy. of sort focused proper as the customers a actually think short- something certainly of of time to they're the I just And to that's what our we medium-term spending on relatively then contract if to Quintin a put consider non-cancelable strategy. terms, short-term the getting in to a But X-year or -- we'd Quintin as there to commit think to if I we're look But on -- the into still change don't proper, of term think said, us contract fleet. I sort X-year planning mentioned see the I said,

I market. think positive future long-term this for the very we're of

side. forward upside as our from more opportunity there's So go we

item playing I with Yes. that, And contract a that it's Piers that are the extent changed. or follow sustainable -- X was X- up feel or more spot we're covered really terms we'd -- the getting obviously, indicating, with X-year layer additional follow like market which X more over because more To on nothing's we is, I we're X period. on contract up just item X-

And a follow-up Perfect. just final that. on

they give maybe time with but offer -- willing -- that I trying last to term months? of discussions are now are -- the they there terms how your needs? contract different dynamics start subsegments in their see OSV only some not long-term are the has how has rig these far other for for expanded also that like But has last these And term lead over think in in XX few your in we the what changed to to over And or contract, course, the space, contracts. X plan months of is the the out clients, with of how time markets.

to Piers, one? take do Hey you that want

may always think me, comes assets with Their of would the before we're the some someone longer X to a -- still still to come of times the better are leaving they anchor NOCs out. of customers to lead often and book month's it a out, rig, are the on long of be them. time exception to expecting handlers. some But they a PSVs Yes, time, looking come They're the not of lead have it than of even And like in more X majority who months slightly some IOCs. and in but the say lead expecting out X -- perhaps sort it yes, months have be have disappoint we you available cases, Petrobras, organized -- late would seeing customers to be when amazes that them still And tend time on course. X to still. a months tenders I quite not have we

target the So better commit come that we're the longer-term say, they're not to few change rigs, would next we will Fredrik. -- maybe really to months. I into looking no, they But and out. when But definitely haven't contract over yes, terms do

So that bit changing. is

wish That's All a you right. Thank me, you all for Super and color. good all the helpful. day. I for

are this back call to There Quintin remarks. questions would the time. over further to for like hand I Kneen at no closing

Thank Thank again in you, Goodbye. you, will you November. we and update everyone, Ian.

This concludes today's conference call.

You disconnect. may now