RNET - Earnings call transcript Q3 2020

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Operator

Good day, and welcome to the RigNet's Third Quarter 2020 Earnings Conference Call. All participants are in a listen-only mode. [Operator Instructions] I would now like to turn the conference over to Lee Ahlstrom, Senior Vice President and Chief Financial Officer. Please go ahead.

Lee Ahlstrom

Thank you, Andrew. welcome third and call. XXXX morning good to quarter RigNet's earnings And today is copy release under the which discuss press our our non-GAAP GAAP supporting we'll A earnings schedules, Investor with Relations of website, to posted our schedules, page. including metrics to www.rig.net, metrics, reconcile deck Investor to today, be follow we certain referring and Also, our slides posted download so Presentations, under in new a page have presentation I to you urge and the to the presentation Relations we along. will

Executive any President. RigNet the call. Pickett, underlying vary to materialize Form other Officer Chief and Before interactions, incorrect, are And like should gas RigNet's certain that indicated. impact Exchange we strategy, risks PPP Any make of other Factors turn and of like assumptions. in to we report the or from disclaims that the general future historical but third-party one duty with and but of the factors to or most of on oil Should I'd Commission. will are Steve? and filings and risks our business, today. XX-K to expectations related, on These call to facts, uncertainties other recent plans that these the limited our statements loan started, include, section prove involve associated statements and not the aspirations information get not assumptions I'd in market actual the and or timing forward-looking Steve may nature with our the you annual certain and limited Risk detailed on the and now, including results statements revenue, be aware making update forgiveness COVID-XX RigNet's customer those statements over Securities presented to, risks, not industry, forward-looking this of materially are more uncertainties

Steve Pickett

us morning on for Good and today's call. thank everyone, joining you you, Thank Lee.

measure non-GAAP we managed communication user particular. a that This where incumbent team revenue premier The will begin revenue Despite is our months win offshore drive away early services of quarter bid, XXXX press key On is AI-backed drilling associated result some million. our heard, performance of as Lee a me announce expect direct declines, million. in we second We're impacts ongoing defined loss several second of provider. EBITDA, growth million the important in able as reported long very the from today multi-year competitive Both the secured in communications based third industry global that that energy $X.X Errol from the one our a also business with contract to as to Operating net of and was quarter our negative was XXXX. XXXX. of pleased quarter Olivier, with Intelie, contractor Yesterday these Chief RigNet a CFO, after $XX.X release, were in delivered economy we $X.XX revenues RigNet's share, the Ahlstrom, deliver managed to on machine-learning as quarter Adjusted as global per metrics adding a close, down on of the for the a the will we platform. enter wins phone COVID-XX we Officer. were services new our in you from well the on measures or the effects the longtime $X.X the customer market a

operating up progressing production, increase monitoring. referred further more this to the conversations terrestrial to vision. digital partner storage transformation. communication their seven our down RigNet differentiated driving the to as to to our the This we're the vessels has early currently portfolio important RigNet creating Brazil, was number with be robust until This and FPSOs. landing that about network yesterday, and is win, with services, expanded seeing last complete from one years reach assets and have through off-take customer including With for addition of In our core in service with really of over our floating, how grow able one offerings, also award threats in several realize service important evidenced demonstrated their and managed pay decision up further significant to Intelie; strategy expansion relationship their with developed and added the in for we've deliver offshore were but the the operational customer services, last to a we In of engage backhaul, are this Because another of value providing of operating to through value communications is the to few trusted known XXXX. disclosed believe bundle off, enhancing operators fully well contract light this can including a vision protecting we're automation we We've of this well-positioned working by package in-depth helping customer of a security critical who's we FPSOs path this now, us services future, been that move to we underway, win. been from stack suite them and win this currently and an communication safety and expectation our owners to maintenance, we're and MCS largest already to vessels, business responsibility equipment for, release relatively provide position excellence as factors begin capacity, also the our the cyber service of global we key moving our satellite ultimate press in in their years.

XXXX. this expect will early win substantial in revenue recurring revenue, starting add We monthly

volatile share in outside markets service taken start. got we've worked gained RigNet We've As most Intelie traditional we've rig midstream the of our MCS also hard specifically our to energy. less beyond its market, of in Today, meaningful communication the apps you vertical market. cyber know, market and expand the our into IoT the or drilling expanded and where business production security services, our and have solutions, business

you In share drone beyond the market. the the market. for mission refer the diversify driven we on a in take oil to growth, slides like gas push material to this to this our in of talk we market in asset I'll some penetration flavor more strategy Lee has little into embarked of MCS since to have the further production and those mentioned, time significant services. how class and a give terms I'd presentation to the market the and FPSO our of revenue stream managed communications been about successes

we upload. highest serve the serving. a FPSOs portfolio, and competitive presentation, at range we you be to to they XX you'll disclose look light ARPUs require highly among in reasons, bandwidth, Slide of vessels a any because RigNet significant take site download megabits see map on While XX, are XX typically In complex, are expects specific tend to that amounts or our per future that expected the for is, of both current for long that the types FPSO's deliver don't if ARPUs and second of

where West gas America vessels, shore deep place. oil the biggest back water processing. include why used the very there infrastructure North infrastructure few or or no and get to in That's to that type for there reasons of of were one in where is the in in present which these for are active ultra-deep Brazil, markets are is environments, and and Generally, North Africa, We little FPSOs Sea.

current market. ago, in we side the target the for come online On we've our this market to mentioned share. right today, slide, a RigNet and few win look continue market began us, ones grown contract that operating just about I sites With to another expected ten only of has XX% years the you'll XX and quickly contained growth. be Considering to see including to FPSO the

As calculations, in you to XX have included to share these FPSOs production-based We expected XX, there's turn market good and to the years. add our believe this to of five as over our use in of MCS the revenue add are XX to are installed slide optimistic be reason our nicely stream. rate. be end ability already XX. on Slide QX overall begin about new us next shown before expected revenue the can to vessels our seven multi-year growth to growth We for of FPSOs these of contributing XXXX,

the Moving communication different an In for have systems of have SI to designed FPSOs to XX part an XX seven been about are Slide XX, and to outstanding important continue for or our we eight. integration, vessels we've bids new years, and submit last currently and FPSOs, the be system business.

for designs is systems One of critical operators the repeat we're choosing trends like today seeing and communications. holes to

and of and out been we respond when leverage to we're that we're engineering previous be able has work knowledge build on tenders, So effective market to design to historical often very assets. able to these as this networks done

of working environments, Finally, AI-backed of for On customer a FPSOs learning. bundle we're data wants more that part delivering so solutions vertically help other have great any machine-learning are is at take of FPSOs, with represent see couple production speeds machine integrated it's introduce production By monitor XX, these highly for Intelie's market of the relevant. FPSOs line effect, a we market. for AI-backed in built, optimized satellite yet one have of bandwidth-intensive it's critical that and power that often, to creating fit would delivery systems, FPSOs harsh network that more drive is business applications smaller network even the and great capacity. safety for for example technology for is flywheel we work than customer us. And where visualization to Slide screens This to the of us and shore, that feedback. of demand some and another providing using RigNet's into another the real-time because I've them a mentioned who there's on advantage reliable opportunities are RigNet's opportunity you'll a specialized a Intelie latency customers

the the market ahead, spite we continue and excited As we remain macro business we challenges. to momentum look in have, the about of current

quarter, to activity remained that and Apps will things as rebound. in predict IoT capital begin we that Last look it have activity when we this industry with they sooner is or XXX the later level or noted our had levels this companies can't customers obviously oil to high. when in and We of in we about MCS or spending, reduce typically One you, opportunities. responded whether gas happen happens but XXXX, will

some This Intelie, environment. continue POVs excluding this with quarter, move to that and in over ball forward profile slowly high tenders, number albeit was the XXX, where we

eventually on great are in are will looking during does indicators with a I delivery the but projects SI waiting to along pipeline the also bids, projects correlate the first XX there's not budgets added outstanding these that But inquiries SI, will revenue in see opportunities XX follow, months that even at We clarifications quarter, and already awards. October some in for amount immediate and bids note significant the are new the on always we'll XXXX. me of issue work we know you in create leading to preparation half that XX Let the the of we've backlog horizon. revenue the have make begin for customers to already RigNet. they for concerns, opened as believe October. in of in that proposals of to to potential $X more backlog delivered and these for some million received SI and and At be customers we quotes mostly

value recent reached In be XXXX. XX EPCs Online of a billion final there in XXXX an from $XX that $XX states to in are billion expected to aggregate $XX article of decisions Upstream with are billion, that from up fact, an in expected investment level

on and bidding and a but Of you pursuing magnitude terms apps, Qatar are number communication we market along the both significant the the total business. $XXX serve these we're an million also rate alone. many domestically a markets. internationally, of and the represent project overall government systems amount, pipeline, And of sector, opportunities of we're in To MCS, growth our opportunities parts fraction RigNet the the gas should communications pipeline, over with oil correlate opportunity through core of in in contract idea give and we have value course, of still total projects, cybersecurity for of in that projects the include the projects of with SI they our

energy to our below back healthy. Our the expect down team XX, has continued to in costs and do of recently I spending managing full spite In tightly in in can expect with that we we sheet for that remains covenant market, talked discipline. challenges revenue pipeline, that important September guidance, well combined office given what work and while be the year-end, formal and deliver XXXX. wins we've our today, X.X the That performance that tell in X.XX, our don't reiterating confidence focus is and costs ensuring yeoman's provide about the to have our will maintaining steps and opportunity above XXXX leverage ratio capital you I've at X.XX announced remain At compliance. we adjusted on EBITDA balance to All us operating year covenant.

Lee, I global in drive to RigNet and customer everything want Before results business. the I hand you're satisfaction team over doing thank it to our for to

tests creative acceptance year lost for solutions that, time continued and million excellence We're applications proud or You've make things thankful adapted to our a all our to almost team for have With to virtual numbers. with recordable learning. come machine very worked Lee no ask customers, the hours and software some of let like you. remote me with Lee? comments deliver incidents. environments, service factory up on And of for has to remarkably well work this

Lee Ahlstrom

and I listeners Thanks, are And all times. healthy our during these difficult staying safe Steve. hope

quarter with I'll And comments and at me balance additional Let results a segment then, start on the conclude some of the provide with a level. details I'll third level. high sheet recap at liquidity. some

you and I'm figures third going But XXXX. the second Consolidated the decrease million, of quarter IoT MCS, The the deck. to throw again, many in keep was And SI XXXX. in absent attributable assets. $X.XX bandwidth reduction million site was across was lower $X.X in intangible too non-cash deck. comparisons in and usage you from focus revenue of saw some quarter the from timing today, a to on per loss in IoT third in a of second segments of things that this of simpler the can a year-on-year comparisons the and of see share, million the result $XX.X count and out at quarter X% of release a the projects, available revenue comparisons press as all of on of investor time Some to sequential the for quarterly Investor to six Slide the are not $XX.X segment. touch stockholders in decline as XXXX of a I'll or including approximately Net quarter impairment in few we common minutes. on decrease a decrease certain

$X.X in results of second $X.XX third of a $X.X of in quarter or million, charge, impairment this the share per Excluding XXXX were share. XXXX. or quarter $X.XX to loss per million compares the This net loss a

the $XX.X on online. segments. XXXX count, was move in This driven in quarter. site compared revenue by to from the coming XXX million basis good our more these help up was million second XXXX the teams network Let's as the doing lower XX.X%, prior benefit points been and QX from and to sites have quarter second our to than communication we X.X from the to procurement Managed services to engineering to Segment some began delays the in reduce really of decrease margin $XX.X quarter costs. gross quarter, work XX.X% was in

Mexico, any Mexico, And XX seen storage comparatively sites were up of oil dropped good compared bit as to we last the down of our that those and for it the much count some increased quarter shouldn't quarter. lower of material At XXXX customers get of was a MCS September previous third we XX anemic. activity customers sites, to has a pretty of quarter Given in quarter-over-quarter. site Gulf were on where essentially was and drilling had be the when don't believe begins production by The [indiscernible] generally that with activity that Offshore XX current full. US where we surprise we've environment, the back second those, were decline quarter. pick may again. jack-ups XX, and sites the news lost of XX is prices were drilling rigs been to and sites by offshore those XX actually compared in

Finally, other and are These of which on net overall in sites for activity. significant a us, ARPU was sites impact mostly decreased international land US don't have and revenues. XX, low combination a relatively

of slide see can the You investor this on nine deck.

for Slide X% come I'll Finally, IoT and down down we online. to million bandwidth to the down QX among XX enjoy increasing continue which deck, $X.X was revenue on slightly quarter, prior as a share in looking little of was significant bit the revenue In to at compared break $X.X usage share XXXX. million with detail. market to sites and the floaters, an more new expect IoT expand a it Apps jack-ups compared in we quarter.

We based in our the second also decreased lower saw apps some third on in the compared activity. to IoT. quarter In sales revenue apps, equipment quarter-over-quarter slightly reduced

year-on-year Intelie revenue increased challenging environment, apps of However, ramped a across in number customers. up even as this

And Specifically an XXXX relative took split of up to XX% impressive it the in time, as QX lion's compared XX% for revenue XXXX. IoT. first the was segment the QX to of had XX% QX apps in share the revenue XXXX, Intelie's

levered future. segment million to be this in apps down $X.X in $XX.X We XXXX. million, the Systems QX continue for Integration the XX.X% project from increasingly that was quarter will revenue towards

progress being noted, the tied Steve see begin despite a work of SI as costs margin QX, once are As But by we acceptance Backlog to revenue always and and $XX.X on made XX.X% the project we declined sometimes awards, in on quarter. to projects decreased factory replenishment our remote site prior remind are we the so investors, COVID-XX in business in to protocols QX, from our good million Gross certain continued place. the projects, In backlog. progress healthy ahead million more impacted with XX.X% strict uneven. for projects $XX.X in in and believe will as as the quarter. prior quarter, SI revenues on and moving as some testing from productivity timing XX, prior customers we September that of to compared

assets the we a non-cash of I impairment market result of intangible SG&A carrying excess conditions. the mentioned of recognized value the earlier, contributing quarter, We're expenses expenditures of were performance. down to As $XX.X $XX.X everyone QX a keeping fair strong in million a our third ongoing on to in XXXX. in as organization certain with those of We're hold in the in value also the as XXXX, compared QX on slightly result to costs continuing million minimum. to assets million the line $X.X being capital

For XX, CapEx in million the $X.X to September compared QX three months $X.X XXXX. totaled ended million,

As After of capital were these accounting XX, XX. as accruals, $XXX,XXX accrued compared about for XXXX. of cash on capital September June $XXX,XXX, were a basis QX expenditures expenditures million $X.X to for

labor. quarter maintenance. investor Slide of and On includes million based composed CapEx deck, about substantially $X.X spend, $XXX,XXX capital commitments of Third was use see base of internal you and capitalized the million breakdown capitalized of $X.X success XX of and can expenditures, success year-to-date which labor the of spending,

We begin the CapEx tick two will the to discussed. we wins see we up a equipment quarter, as related in fourth purchase to big bit

interest down million $XXX,XXX principal after the million we cash During about about making free is generated the in and second quarter, flow $X.X of $X.X from payments. quarter. This our

EBITDA and backs subtracting and As taxes, and with cash by calculate starting other cash this adjusted CapEx, principal a cash add reminder, we interest.

CapEx. we the of offsetting the $X.X sheet, to less on to details unlevered million the from with of balance in third CapEx, EBITDA some adjusted $X.X see cash you lower the page or million in quarter XXXX, lower adjusted respect EBITDA, With XX. can flows, decreased quarter, second at down Looking

cash million XX. XX, was $X.X million, up September from June of $XX.X As

which term in with And as we including credit on $XXX show current our $X.X terms was sooner a from long covenant June obtained million, our Protection made as ongoing agreement. term, extend we At ratio, about $X of [ph]. debt tweaks from the exclude program. used XX. September, or that's gross in filing SBA. our Paycheck million the for the have down million debt XXX-XX by credit actually In amount long outstanding Also, and calculations from facility, debt of forgiveness our as costs X.XX. quarter under the defined as the this XX, has defined defined to the through cap to a versus consolidated reminder, was the leverage proceeds, of end, for payroll forgiveness a the Plan loan being on waiver our Our both Bank the a includes we Unfortunately, as continued the Slide result process X.XX program basis to

obtaining to we amount, this application, forgiveness continues to we to and file So Andrew, our push right, ready for with amount debt. are soon open maximum we do term to cannot forgiveness waiver. questions. that I as we'll our And guarantees, we're possible. the do able If waiting full as And process it anticipate offer some be from extend that will while long think the we the that, that for to expect we removing up

Operator

National question Securities. Klee Allen of [Operator Instructions] comes go First ahead. Please from

Allen Klee

Hello, your the attractive. want Petrobras, the of that just you've in you The that related communication -- can you. I is presentation FPSOs that make them intensity to to this paid addition not And confirm wanted -- just most your to for confirm October, seems Thank get like in for is starting it the FPSO the that something previous the use that? had you new managed is also. to services. with on this information existing you announced I amount contract

Steve Pickett

to Yes, our customer, Allen, it's and this tend the is ARPUs FPSOs the and are best in win additional best the Petrobras. a had Steve. be different It is we've portfolio. not the and where

portfolio, an to the a grow market that focus a in in continue is with of that market, number market market. do we pleased on we've able our very share intensely ideal for what to we're And been So will with apps that to well. as view

Allen Klee

were bandwidth I'm revenue. explain, to lower gross If despite grow gross you and site you look able -- margins or count Can maybe at been a were of some lower is into what you and the the last you behind your and your sustainable? sequentially, what costs go segment, managed could But of percentage you margin, is talked quarter communication that what's costs? that network maybe about margin assuming improve

Steve Pickett

to engineering work maybe procurement how sold start out please to due, Errol, goods get network Yes, And team cost supplement. Lee done, within what the largely to teams or very to teams, our I'll It's has have related of communication services. the managed costs our and side particularly of business. pleased indeed, executed of the

Lee Ahlstrom

is that this good turn had significant with good when the working morning. in off spirit some folks bandwidth providers, And, also a are costs concessions in they've down some circuits of for sites but us active, no from with all the Alan, partnership, a of dark. in Lee, circuits Yes, very our success turning The go getting help were to at procurement dialogue longer all bandwidth us the team, the time the spending in looking bandwidth of in examining system, our engineering providers. of amount contracts,

Errol Olivier

install bandwidth This are out I'll focusing and of doing require that great which more turn is managing to unnecessary down bandwidth job but those revenue and more Errol, lower only a and we're not opportunities and us our are add hanging readjusting turning equipment. go we costs the also circuits to on to just needs, fruit, up having also, of instead

it's So, may a quick picking jobs turnaround. up even we're profitable, revenue also revenue because that see decline, more we while some are on

Allen Klee

are in little more Can a talk bandwidth you for environment? this about looking bit customers more actually who [ph]

Errol Olivier

in that's about I mean, whole I like about. great. this real. something thing industry where really an is We're digital transformation talking Yes,

quarantines perfected, and these the fact to oil, that the that gas of been more and for restrictions to pandemics be doesn't with and things these needing especially oil remotely, all to have of and and it's like years, do until access. more are For the but industry able have price we more changes companies change travel, and

remote one that the a on to is on walking phone or delivering, guy let's back. camera going So at ABI around CCTV, by that they're allows site camera and ABI, the information looking some see we're applications and take, instance, with a or for of transported helmet what's them

But everything wants the twin, their picture call at So that's the also replicating competitors. everybody to additional be desk. the the facility at there to they're from revenue you our of happening differentiating where look driving able It's facilities a it's it's we in bandwidth. big big requirements And remotely those really digital operate when what us of opportunities what's remote big, for that's basically right at driver us. here,

stop instance, let's the coming see we're happening. increased for which to into probably we're able the company only know bandwidth, are efficient deliver more bringing savings Intelie, that are our is that because offset able from by customers We that helps only with the can additional but to they any them, I the operations, digitalization say, of problem services of at deliver them not applications them costs satellite that applications be kinds helping the have of problems are or, and being

downturn, efficient bit that's them our -- cost for the We've proposition So, really customers, even enjoying even savings got bandwidth. a in to little cost value enjoying bring more selling. opportunity to tools and more we're been more it we're the though a

Allen Klee

revenue If when thank do of investment partnership, when you helpful, very any be about paid we generating network have able Gulf Mexico from and T-Mobile their start the the That's talk back T-Mobile capital you. for to and have this? will sense you'll you of get

Steve Pickett

of is cruise closely with happened short terms that have we're But, industry, an at traffic T-Mobile, given be relationship and and reason, that. when going think important for that into it there's with area is until this clarity given the what's in that that's the what there's what's where incremental to happened the on. models, revenue uncertainty around no, turns any And forward-looking does put I line pandemic not around The answer our through the obviously roaming for move more us. some working point, network back we resides,

Errol Olivier

the exactly Mexico customers and working Gulf I the it One -- Yes, network back Lee was that that's think, well, is also that say, are thing T-Mobile but that is what Steve, it. and to going enjoying offshore up. of using are to

I think But short the lot see opportunities the in we we on answer, It's to knows going come guess, that up nobody just that's time picking back do I once when. the Mexico, the of roaming we that. going cruise of from. a of come. the is you matter Gulf timing that see where a we like ships activity once Steve can't is no, said, give that know But out,

Lee Ahlstrom

get we course, And service from sites the work do active we monthly to for we maintenance revenue the them. have some do that Allen, continuing that out from we're generate there, where of fee T-Mobile and now all of monitor for

Allen Klee

it. Got

For traction and other some announced, IoT, Petrobras from the big update on working you've Microsoft ones? BP, CACI, any like partnership, or that the things with apps of any

Steve Pickett

to call I'd good announce with of partners on progress say, the but, and all here customers. those specific today, Allen Nothing

Allen Klee

was apps My pipeline. bandwidth usage. lower Okay. in for And monitoring then IoT understanding mostly is was that revenue from mentioned you you IoT, get there

maybe you what's that? going explain could So with on

Steve Pickett

communication. there there's situations, pipe One customers Yes, continuous that megabyte. pay are on that some the dedicated where sites is provides two In revenue generate ways we a by there.

as hardware drink, quarter-to-quarter customers has during been a bit And who we bit bandwidth the a was from than which the does you as amount little quarter, pay quarters quarter the used also, if that less well. will. in in previous down of by And for mentioned so, those the was vary used was sales,

Allen Klee

pick you I that say I in the like you gave you it added of to up. in backlog October examples some $X sounded and million heard it could all how thought then, And SI segment, Okay. --

going won't in level? it scenario base that's segment Or XXXX? this up you sequentially or a way is generally backlog you So another that should be we a is level think about doing either that declining from whatever fourth see then maybe improve that -- it, quarter think to the a forward? And it can it in end that case base stabilize

Lee Ahlstrom

requests se, couple coming. start certainly that Allen, to continuing well us clarification, as entertain we for the significant. XXXX, fact this talked project is in we're new see certainly a you the pretty confidence projects of giving we And is gives could guidance, what again, potential a that up. shoot as I right awards, -- think It's without with back to get work matter as respond that of increase per timing. is about And backlog it I as awarded, to bids, these

existing of change we with are positive on which big adding adding may still not And yet for existing orders, contributors projects, the jobs, hit the meantime, these radar working projects, dollar and so, us. in smaller multibillion are of customers some

the backlog think the be XXXX So, down reverse. But tell to I going of will backlog the the I up. trajectory at you or in can't year think I is of end the whether

Allen Klee

use will working have so operating a looked definition, great. the on you know accounts capital, million, how cash in maybe statement, like free with in I cash flow. Could $X the term? then, generate about million close and it impact. just that of like impact had CapEx $XX was have think you That's flow two and components, pay And good you talk of those near an flow and looks revenue downs about it a things around you quarter maybe deferred pretty your receivable different cash your the to good

Lee Ahlstrom

June that's at for think cash to down I our at debt, ahead. to on the the comparing one to of good for where around up they're slugs. With collections. know looks stronger, we in basis has terms your send to year. and they strong to flow, calculate on sales yielded using tend position put as recurring of bit look I there, really, the that least ourselves project coming results move sheet we've make up can that quite a in working pretty base to our Allen, have been we'll time better opposed what invoices, continue large very has continue us a you quite and of And paying we the internally, what the so bit, our shore as focused customers, a of Sure, you day throughout AR respect in had some customers it outstanding, balance And we like but quickly, that that be and expect we effort obviously pay revenue of gone free number course, a down relatively a example,

Allen Klee

you. Thank

have tremendous. lot this is got on said you of your And to I call. a things the good presentation, You detail that say

you So XXXX. said, me, out than revenue in that that what believe appreciated. higher missed and catch you thing my in you adjusted most most the above be I to it's One are. estimates did significantly the statement was that deliver XXXX EBITDA where stood would I but things, And that. that's

to you've I is a that apps will is that gaining got be that's is that -- surprise share to wanted big that? so, the way me like going it the in wins their growth about you big and there. these going to of to are your MCS -- add anything And And Or help it that think to to be Is as mean, start continue way to just to to driver. there going it? sounds the should is opportunity the SI think

Steve Pickett

I good summary, think a Allen. it's

Lee Ahlstrom

I agree.

team and of of is and start And start going finish in. course, know SI, we work will expectations may lower to that think about in ready up alone projects going we're have that and had when of compared that Middle some to focus in areas you maintain thinking East talk making where We of we're our awards, at just they I bringing country, those year. look hundred get segments some on again, to fitting continue where all the and you the getting the dollars up be feel done in to exceed I the are one to When revenue the spin [ph] one in about you million cost. that XXXX. be

Allen Klee

great. That's

with That's my Okay, thank Great it much. questions. job. so you

Operator

go Brian [Operator ahead. please comes Equity, of Instructions] The question next from [ph] Emerson

Unidentified Analyst

really tackling. quarter; great guidance, the well. forward and Great as Appreciate blocking

pretty And as out just it? production that flowing -- the oil I of back storage mentioned, uptick you contract any You MCS. helped in again item was line mix had a the FPSOs if in nice that boost Gulf? line added wondering primarily production the it in Petrobras in the good you if Or just more was becoming available and

Lee Ahlstrom

have the bit It little at you Slide latter; schedule right. been was of sliding is on for just our those a the FPSO the to deck, least XX see really the Petrobras. can

fair guess restrictions had has with, struggled we've say I everything but around else. shipyards to in and COVID installations I not think Brazil it's the we've, Petrobras issues and As with

course, turning really the So, the was win, those are But significantly count of Steve to come. the to revenue, with about, other is around with site up production where yet come. And yet that FPSOs the increase that other here talked platforms. customer we're

Unidentified Analyst

great. That's

seven for the correct? that floaters. is potential XX contract new the So with Is

Lee Ahlstrom

Errol, -- we about talking they now. mix. grow. they're that to You're grow, be should a the don't know, out? we are going I have FPSOs, expecting give we have that to seven number specific they if or as into They And the those can adding

Errol Olivier

I information handy. I'm that sorry. have Lee, don't

Unidentified Analyst

Okay.

trying item Just to again. tune fine the line production

seven, weren't the you was on earning much mainly So it tests.

add and it? as So to look you share, FPSOs roughly you that way add at seven, trying nine Plus from a could or forward other any on market to Petrobras the is the then XX ones basis. new that might, you're

Lee Ahlstrom

serving, expect have with at the our look that current FPSO it ones additional so XX, Petrobras to Yes, and on that customers. market that plus is, way slide we're to we the the come for there, other both includes on share FPSOs we

we have being on revenue generated seven mentioned. Now remember, we that the

other would count be count. the as of So incremental sight in on, Petrobras site when come already they new FPSOs a at new on. particular quarter those our in they're end FPSOs, But they the customer, with this come reported

Unidentified Analyst

helpful. that's Okay,

have the offshore, that one the though and essentially, held XX coming fleet except as comfort looks that give when but look coming line year? XXX. Does for of importantly, more I FPSOs, potential to assets jumped you other then, you XX the have the right-wide I the if on the utilization substantially increased online you're next off, base all being you it at online extremely around a contract. things with for So going XX [ph] like, And well, with XX, it's you grow that equal almost to floaters

Steve Pickett

above results But important I it. on in that didn't that an XXXX terms indeed part be confidence in XXXX. what put of gives of us adjective yes, will is the financial that

Unidentified Analyst

site potential the had When that's you've like XXXX. I add looks on, those highest that well, count it as since

Steve Pickett

Yes, think dynamic that's as we're And result, a at who confidence in pleased really, to are a And offshore demonstrating service And operating high on given reliable we're I that serving a market's deliver. well. more reliance and customers us network, quality, a have the really performing. delivering this think with point. best-in-class we're team able highly more how is and truly what is great deal the I

Unidentified Analyst

apps the RFPs, quarter, That's and at apps that the XXX mentioned MCS awesome. great Jumping QX? XXX, and that on from and from or XXX Is IoT, to is you number? IoT, up across new

Steve Pickett

it Last I Brian. third I'm Yes, was differently, sorry, was XXX, should say quarter XXX. quarter was quarter XXX. it second

Unidentified Analyst

that the contract two end, these So, with XXX, of within is the deals? two opportunities contracts of fleetwide floaters, somewhat pretty the be it big like the might type the around and seems mid-range on would FPSOs those that higher be on -- wins

Steve Pickett

as those higher-end with characterize I No, larger the would opportunities relative to average.

Unidentified Analyst

half contracts, in of within that, your contract, a BP about million $XX on have larger The you're smaller, the some win. to particularly mentioned are installed was wins ago And be now averaging a quarters going you which starting few I on XX add concepts, and BP. million that to then, some reds, But look today, you're during proof software like you a when at a paid QX.

XXX So MCS, two position of in segments. key could good wins like you're across it at typically, I in business look I software. I that backlog an use are terms looking a seems those in pretty that then am potential across right, the RFPs average at it when And similarly sizable

Steve Pickett

a and the One expand the that of go is, with global for that are footprint started pleased particular in we terms there really use. of part We're they the revenue really grows they might with their Intelie when as customer revenue has a ways in platform, Intelie. three in momentum with world grows get

Another growth applications. be new development can of the driver

to that solve to that's applications platform add for layer can And two they might So or particular problems. for growth other very they two the that to new easy on trying other to one -- select as drives they're solve. revenue then, one But particular or well. us solve to problems

the existing customers. we've pace at there is way that been third course, signing grow the ways to customers. up which with And And logos are business. more So we've then to pleased with two very new been revenue of secure in

Unidentified Analyst

pretty $XXX EPC market SI, that jumping when found SI that, good And comfort year. for set a orders look at that's plus I then, addressing offshore request million gives rebound you're pretty on great. That's next proposals as opportunities well in I you a $XX mentioned, also year? and sizable and articles Within billion you next to set for the

Steve Pickett

our going to [indiscernible] expand encouraging market market only energy does the -- the that me that significantly, is to market, that primary it the is Yes, remind it's market, expectation our so see but not about our to primary the and when to cycle. at the people market, does that, cyclical, of tend low cycle, of the at tend forget high end be the end and

Errol Olivier

facilities systems that integration his in communication are only add this going a right before, those and spot. not able was that, we're are successful and the places that, use opening done to is, and been a already. these from say able Steve our mentioned the by I what on systems to into we're in we've use in of I are mean already engineered comments, of to to this think our where falling going past experience I to sweet number to that these And lot on more And and but be engineering, work vessels bids. we've jobs competitive

the we to safely be these risk So with the and record minimal amount win. knowledge of track and have information have to we able bid and

of us things before. of given lot done a we're already a number of -- on times confidence that's So bidding we've bit that that a

Unidentified Analyst

in hundred if When do gone out RFPs would or it you in with have at you can Where look up SI, million QX, dollar out, number? the addressable like does Obviously QX the number I'm changed? have you but give sit have that? curious, in XX RFPs you is That's that just seems it a past, gave that it how you awesome. today,

Lee Ahlstrom

October. tenders have talked inquiries the XX XX offhand in new that about clarifications already I and don't or we when new

revenue each substantial activity robust. terms the certainly alone, that mentioned to are [ph] up figure, integration $XXX million we hundred correct. is And for level So, yes, -- they're the opportunity adding that's in fairly million And us. projects that those of dollars

Errol Olivier

year a some the also That's month. gates out whole orders into coming to earlier, putting open. that's matter doesn't the said just is And projects and it's you the are the and have of of fact happen; put the not get that as the immediately playing being purchase leading full mean market next of after are These exactly to we months the budgets the next set you inquiries because going proposals just get together. robust, of are And still right. pipeline down. and eventually that projects money today indicator and chaos COVID -- in, a start when. after and settle you These to months are that in they're start But the is released great that awarded proposals your advance and it's going pipeline's that strong you to

Unidentified Analyst

levels deploy Aberdeen, [indiscernible] Quick for you line that revenue bit you over usage activity effect and as the potential question for expanded as talk can with and in driver deal in BP about the Steve, with kick takes revenue that segment? Houston viral a driving on

Steve Pickett

we've And deployment. Brian as is it started we details [ph], about the it you Intelie it announced applications a that indeed, very global classic to. add platform a to new is contract can course, platform relates deployment. is specific easily of the that haven't revenue. that And on also But global that

conversations to in of that part applications could about were added be award already the first well. as platform, other we're the that so, And engaged

and forward their time great to more them there effects. relationship over there's help So with digital doing looking to even transformation

Unidentified Analyst

it in deployed safe that weren't be incremental forward, say Is fully couldn't we to that going QX?

Steve Pickett

to opportunities are with I think continue there BP. to grow

Unidentified Analyst

appreciate Got it. it. I

forward look speaking you the future. to that's in I have, think I great and a all quarter to

Operator

any I closing to This back for answer would concludes to the over remarks. turn conference session. question Ahlstrom our Lee and like

Lee Ahlstrom

and think opportunity We us tell the good it; upside it's all to and March and ups, you story. back Well, earnings and appreciate one. we're questions to available and today. quarter by timeframe. the We it you there's further email if of we fourth questions I Steve follow you our appreciate thank any will for for be by again. think have We an Errol, thank lot joining for report the in to or exciting a us voice

Operator

concluded. The attending conference has presentation. for Thank today's now you

You disconnect. now may

RigNet (RNET) 8 Nov 202020 Q3 Earnings call transcript