Release Date: April 26, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you discuss the drivers between the low and high end of the full-year guidance, and should we expect normal seasonality with about 65% of your EBITDA in Q2 and Q3?
A: Bradley Dodson, CEO of Civeo Corp, confirmed that seasonality should continue, primarily driven by the turnaround season in Canada. The range in guidance is influenced by how the Canadian turnaround season progresses, with inflation also playing a significant role, especially in Australia concerning food costs and labor.
Q: How are you thinking about uses of cash and criteria for potential M&A?
A: Bradley Dodson explained that dividend payments and share buybacks are priorities. For M&A, the focus is on organic opportunities like contracted lodge and village rooms, and expanding integrated services and geographies within Canada and Australia.
Q: Given the impressive quarter in Australia in terms of accommodations and food revenue, is there more near-term growth expected, or does this level off?
A: Dodson anticipates further growth, particularly in integrated services in Australia, highlighting the company's success in winning market share and improving service quality, which supports ongoing growth.
Q: What are the risks in Australia given the number of contracts renewed already?
A: Dodson noted no significant contract renewals until 2027 in Australia's integrated services, emphasizing the necessity of daily excellence in service to maintain current contracts.
Q: Can you provide an update on the food and service segment in Canada, which saw significant revenue growth?
A: The major drivers in Canada include the sale of McClelland assets and the wind-down of LNG Canada activity. Dodson mentioned efforts to expand the Canadian business into new geographies and industries, particularly those related to EV battery components.
Q: Could you discuss the dividend policy and its competitiveness?
A: Dodson stated that Civeo plans to reevaluate its dividend policy in the latter half of the year, considering it a key component of their capital allocation strategy, with potential dividend growth depending on the company's performance and cash flow.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
