HLX - Earnings call transcript Q4 2020 | Helix Energy Solutions Group, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings and welcome to the Helix Energy Solutions Group fourth quarter 2020 earnings conference call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions].

As a reminder, this conference is being recorded on Tuesday, February 23, 2021. to and conference CFO, like Executive to now President Vice Mr. would turn over the the I Erik Staffeldt. Please go ahead.

Erik Staffeldt

and release. our fourth Good Hopefully, an morning, our XXXX for our on our are Scotty myself. Owen Ken us joining released presentation press this Kratz, to the earnings Helix opportunity quarter our today everyone and and related conference Neikirk, had thanks call our you for Counsel Participating release have call on slide review Sparks, CEO, night. today COO, for General last

slide materials, you can page clicking by have If www.helixesg.com. be tab not a webcast presentation do today's website on the the our accessed copy The Investors can of the be under these release can Releases accessed both accessed through press icon. at be Press on and

begin statement a Before will remarks, regarding forward-looking prepared we Neikirk Ken? Ken make our information.

Ken Neikirk

and current are conference the XXXX. During certain of Litigation making the this based Securities projections than and other are in in historical harbor provisions this safe of statements under Private call, Reform statements statements fact, our forward-looking we conference call Act associated presentation, All statements forward-looking made on the or of anticipate expectations.

this the broadcast Investor replay and comparable section the reconciliations of annual at our the provides GAAP www.helixesg.com. earnings website certain to our For other under from materially annual report set on due of be projections press final factors, with our recently disclosures measures are a certain may accordance filed Owen? Our forth SEC. in filings most slide presentation, non-GAAP our results the In this release, may with call, the including in of number reconciliations Form and actual rules, future and differ These this made. financial along of and measures. statements those of a available presentation SEC Also non-GAAP forward-looking our financial to variety with report slide during in two, XX-K our

Owen Kratz

and on Texas Good morning hope well and the in customers Gulf staying their everyone. everyone the have you our Coast we safe. storm are out there families and We hope doing employees weathered and To environment, in recovery. region, of market our path view QX we the morning, operations challenging dynamics XXXX. this performance, our back preliminary the and our our and are current This for will expectations to provide review

summary presentation, the results. to The through fourth Moving Sea five of financial the in slowdown provide of our the impact level seven is evident high quarter. a slides seasonal in North performance our

in Sea positive robotics normal and our well of and year, were were both million reported group as of Mexico intervention drop in the experienced $X months. of exceed spot the worth in note, EBITDA net we work noting. scaled during of $XX time This well On income Gulf allowing secure significant back a that Our to $XXX intervention in North with Revenues North this expected our million. million region. during expectations us able in to and additional robotics in QX Sea a activity it's winter and customers is group, but both the a

gross to decreased quarter. profit previous the from in million Our $XX million $XX

out. We QX that emerged In our results, to performance, $XX our recovery many We levels in potential with headline compared were predominant. impacted $XXX but with $XX XXXX, XXXX COVID-XX activity and and beyond. the reduced million XXXX million million and net there was revenues The that pandemic in the market the pandemic year indicators factors immediately XXXX $XXX for many in For our in revenues positive entered year-to-date further extended in compared income million, were net to income million of of XXXX. million $XXX EBITDA XXXX. $XXX of of generated

The QXXXX changing adapted year. initial project. disruptions throughout the to a the environment minimized Our operational well and successful team had

on working offering renewables the its clearance expanded year. farm a much group site wind robotics of project Our

Our team quarter of eight. of sheet COVID-XX. slide million at a manage to QX. the On performed compared million, perspective, impacts balance end of continue was an $XXX $XXX point to end we at From the the the to as our encouraging well, cash balance

million the During quarter, operating flows of on $X fourth million cash spent we generated $XX CapEx. and

the of generated we positive year, free cash For million, marking third flow. of flow free consecutive cash the $XX year

over end was and million was Our to X%. net turn capital I the of $XX for debt at in-depth will operational results. an discussion book net of debt call the quarter to our Scotty now our the

Scotty Sparks

good Owen morning and Thanks everyone.

logistical COVID-XX and fantastic Moving the despite vessels job. to disruptions to in us the slide testing an XX both has minimal XX operate well with environment are The teams many challenges. challenges pandemic. challenges, respond on and to and screening operated XX. XXXX countries our a our we and these onshore XXXX Despite to quarter, And pandemic including operational of globally. we continued COVID-XX extraordinary restrictions, challenges the partners, personnel. quarantines, fourth and pandemic, presented due the and through challenging in the doing have Yet continue to logistical presented travel to presented offshore, throughout

have believe guarantee established the not measures that personnel very in it's reach and the to to them XX,XXX worked high impossible against offshore. infection will And we over protocols virus, allowing to including we good the very far vessel, We vessels. place prior should occur have have virus well join to-date measures standard an thus pre-testing a of safety whilst

quickly to to program including as staff showing is person offshore quarantine steps as possible. react any symptoms soon to designed remove and Our

mandate continue tracking distancing contacts. We close social to of and any

we are the exposure perform our occur. Most greatly an limited infection remotely also doing closed and frequent the our we of vessels. in offices of have business remain our onshore place Additionally, teams job should fantastic have cleaning protocols working that Altogether, functioning. feel these a crews keeping cleaning

reducing our revenue I the Sea am swiftly reduce proud our vessels Islands, as We two in The of in pandemic part SG&A caused base QXXXX as the reductions expenditure in of XXXX spending. they operate cost operational to these the and whilst offshore of the with unforeseen capital way by extremely very Seawell our to the coupled achieved one have circumstances, equaling and the Canary good relation our well and in responded tackled partners onshore challenges. these solid during standards year. safety having in years they uptime. best testing stacking staff, North XXXX, to the staff cutting for have of results And have

$XX seasonal profit of a usual X%, quarter million and the make do our to $XXX in revenue teams we quarter. during producing due Even million gross in fourth of compared the produced a $XXX to gross conditions, this million, $XX in and revenues Our margin difference. lower slide XX. Over profits than to a utilization of environment million, gross third resulting profit

producing relation to $XXX Our year we issued earlier seasonal Considering the a by XXXX effects Even effects vessel achieved response vessels, in pandemic, performance. and obtained in we revenues gross ended three with utilization quarter in best still fourth XXX% of of The us fourth globally was the the warm-stacking profit one presented quarter. of with the of of performing condition's resulting robotics of fleet on uptime during EBITDA safety million, profit million. to the utilization. operational was of $XX year the and top levels really guidance our well achieved the and exceeding of weather management challenges the the in XX%, the $XXX utilization to of quarter a of that fleet chartered utilization million, the revised periods good pandemic. globally in virus, XX% levels intervention

with most XXXX, were many vessels Our statistics multiple safety reduced compared achieving at XX.X% to LTI in operated fleet categories uptime years being efficiency and now free.

continues working efforts the In team We know to the of quarter. operational our during had of are the extremely QXXXX the high both to and standards such QXXXX and Mexico, a our pleased we Gulf performance.

we robotics QX. undertaking Sea well harsher quarter Islands our North back vessel at working COVID by utilization works for in work in Scotland, months while detailed BP Gulf The across vessels. seven XX% trenching BP operations the seasonally high yearly of enhancement achieving was its enhancer extremely the work the both XX affected until of then then with commenced of ongoing. and between more In production the XX% very review days in in and intervention fleet chartered the operations Seawell. been Nigeria performed as ROV for well into ultra-deepwater in renewable Mexico. was warm-stacked well business and has The Our Slide do region, usual very currently a had campaign active Performance the for support, QX. business Canary remains the in standards the Leith, mid-February, warm-stacked to The QXXXX continuing West and vessel QXXXX well. utilization provides Africa QX The globally, of in pandemic. to completing utilization, winter of transit completed along was XXX for performing Brazil most the is that contracted its one vessels remained as

now have a We with basis. on BP agreement for global signed frame a callout work five-year

working However market. XXXX well in therefore little for in to clients. the and has to completing we expect intervention alignment at XX% Mexico in with BP in schedule four due this work vessel small a plans spot utilization in heavy of performed for we gap the the Gulf time, well projects, expect The requirements between be ultra-deepwater QXXXX

QX. of vessels the utilized QX one QXXXX. for have other contract client IRS visible system remained in from jointly-owned for also Both XXK Helix We most the work and OneSubsea under

among years. for in we permitting However, the moratorium intervention currently of and regulations things in uncertainty business of the expect the other to less restrictions our do previous Gulf due, government COVID of well Mexico uncertainty than regarding XXXX of utilization

to Moving XX. slide

worked XX% The two well the then quarter, including the in work business remains to projects reduced The Sea caused North in intervention to by to production gap men requirements a by a one cost an Leith, enhancer Leith, to the work utilization Seawell. the project QX commencing one completing working in continued between Scotland. has a leading the warm-stacked scope. this reactivate go October prior and in of a monohull significant we was then well in minimum the warm-stacking time, work crew related December. at undertaking the with Both and well throughout scope reduced vessel Scotland, in cleaning to Our XXXX warm-stacked well winter environmental achieved this as then enhancer the to affected currently enhancement been in in optimistic The levels remained The had and we month allowance. have enhancer for abandonment seasonal to reduced scheduled Seawell temporary COVID, are, with stacked operating into both entered and clients the mode a QX back that in end transited we of then in are cost will to back in years condition to in through back Canary again vessels hopeful QX. Tenerife period warm-stack previous of vessels of Seawell end daily work at The at reduced the XXXX. Nigeria a quarter in vessel commenced Islands, January fourth operating significantly the The vessel. later QXXXX contracted the and work most the

Moving would work strong and completed I protected with Both year, wells a ranked well, fourth awarded completed in excellence as to on the vessels another Rigs. abandonment uptime quarter. Petrobras Petrobras by In Helix been Year wells Maritime for strong the one of continues Siem on XX% our we of efficiency. to second Petrobras. XX. work had during on our production Brazil, operations had regarding for an enhancement be utilization quarter four Helix the to like six The again to working producing that of go continue in and X by the operational subsidiary extremely consecutive the X of has contractors well and achieved Supplier and QX quarter The Brazil rig Operations slide also XX% environmentally one for highlight utilization Siem continued top performance utilization in and abandonment work on area. safety,

both the Grand and energy In Taiwan continuing X vessels additional wind XX to trenching operating and and a the in The vessel further good XXXX to support. just XX the and utilization and an working XX five Robotics our construction Mexico, also decommissioning the fleet our project. Well vessels. renewable completed large solid support QX, Sea, secured quarter, in North performing on vessel, the vessel the quarter utilized chartered service and utilized working go works Skandi scope quarter, part primarily three of further And of region another and expansion. undertaking In Taiwan, Acergy, non-oil year UK in oil in XXX a chartered Japan. renewables a decommissioning had scope. renewable in for were has review. installation days XXX% fourth work farm days utilization and spot the was Canyon projects the energy days in for from clients. The in of region, and In our in combined Canyon works pay XXXX gas XXX% World project with geographical had projects, Ops vessels ROV a the fully to a vessels Grand days chartered the you and utilized the were undertake in Skandi XXX% In projects Moving working of seven gas robotics for increase support recently combined XXXX, with the Gulf the Candies, provide XX XXX% the providing charter and as Peridot renewables APAC spot renewable further project. for Kristiansand survey and accommodation utilization was resulting spot utilized, utilization renewables Canyon project in robotics slide a was and as vessel vessels during II a Grand on on lines fourth in Ross on quarter clearance days QX ROV APAC a four has an and XX had site on for was on

sector. previously, green and countries, provide France over we sector XXXX, days. in Norway, for at how relatively globally projects. into five had we key some In completing XXXX, like renewable U.K., in renewables US, renewable vessel in nine mentioned I services or we points Japan. on statistics Belgium, completed recently in we X,XXX and further in and six working transitioning XX the work year, We clients detail the good have in worked the had especially In As a Taiwan expanding worked expanded sector. the further have the to would robotics regarding highlight anticipate and renewables, vessels again to XXXX

we in to infield well work assigned last year, survey, site as Over expanded had this three turbine work removal, turbine the trenching and trenching assets services include trenching cable ROVs export and course trenching ROV to installation of to debris renewables in our undertaking as We forward support, geographical continue to line we boulder this sector. boulder service to to accommodation support. support and by installation XXXX aim We we removal, UXO stay intend and clearance move sector. expansion in support, detonation, as so out in started focus XX

these also We trenching I services. the recently increased reference. utilization for will slide our staff slide Over to leave XX. for have sales detailing this in vessels already your

standard teamwork, ways that XXXX. your high we an in even Helix year. than will extremely call to doubt and over There for work Before Erik, our circumstances, no expect is challenging for more XXXX I in and the the extraordinary was, under our again achieving Helix what I an Thanks would offshore personnel, some personnel our onshore turn our to be thank for like and at hard team, partners year. exceptional challenging global an working

Erik Staffeldt

profile December Moving our XX, XX. outlines debt maturity It XXXX. the at slide and instrument to

$XXX funded million. was total Our debt

Moving on XX. an metrics, debt key provides to levels update term at slide sheet balance debt long and including It year-end. net

approximated debt $XX net million. Our

Our of cash at million. $XXX position was QX the end

quarter-end book capitalization X%. Our to net debt was

with Nearly Moving XX. the demand to continues of to in investments, many moving was devastated oil. interest The from be pandemic oil March slide our the weak gas. energy the uncertainties. In and XXXX, the later, impact year accelerated environment COVID-XX away sector has on traditional a for green by remaining

In the U.S., are uncertainties the new addition, from regulatory we administration. in facing

not spending is than have counting being COVID to are challenging fact, a in up we responded on cautious business in and thus slashing and more this XXXX XXXX committing Thus, time in have XXXX. expressed, in spending customers are at as XXXX previously be recovery for to we XXXX. by very Our before to far shaping our

Given which get provide of sanctioned which the this than hope expect said, establishing XXXX are financial near projects at own their many formulating much in can position guidance XXXX That and be we how that term. to We Helix it's our in this provide to working unfolding guidance. through quantitative fact spending feel and results than other still not, in to premature for we budgets, more we priorities point, their do to being lower on XXXX to April be we the the see quantitative XXXX. for say year a customers say

We expect positive in to have previously be free flow as cash XXXX we stated.

well We interventions vessels QX. be expect to QX six working be have expect in and year-over-year to to stronger

vessels intervention spot five working anticipate we visibility limited. the market QX, is where in Beyond currently

will the the vessels the year. We will quarter-to-quarter in for on spot in be of both utilization intervention, of Gulf a expect visibility likely basis. the well Mexico In be remainder market

the be current we Siem levels And season. contract color April XX. dependent a With on by more premature at this Helix second is the guidance. most to quantitative we well be in in feel In thereafter. expect Providing of facilities expect business, many may In gets thereafter. expected currently vessel XXXX. of work less QX West in added a year a Whether work with have uncertainties Robotics site Brazil, Africa, of activity and provide should to to bit Sea December. segment the work lower regulatory with clearance production Production strength of XXXX slide for with consistent opportunity. are the working of be a is We point. seeing, currently Helix weaker with uncertainty, position are a have on enhancement hope X we the it potential Once with region we possibilities guidance the into provide again, to X the deployed is into April. expect one North XXXX. discussions on generally we Petrobras Siem we in intervention continuation commercial vessel The in In into the on regarding contract market. will

First, remains our In mid-December. with Gulf contracted QX. Brazil, operations into the to stacked operations January mid-February The into intervention, QXXXX with earliest the expected is in Siem X work midyear. with is contracted opportunities North has Seawell Siem the Sea, work mid-April. into enhancer is well March. X QXXXX The late BP QX. into in commenced The Helix QXXXX working of last well commenced contracted into In QX. work into Helix for around contracted Mexico, U.K. contracted

XX commercial scheduled Petrobras We an approximate are The drydock day for is forecasted to work with discussions thereafter. currently have midyear. in for vessel

Moving in XX. winter balance Canyon be and in likely is contracted expected slowdown III in an the in two the strong QX. follow-on awarded XXXX were is for North Sea be performing Baltic in vessel of week Grand wind on We the offshore have summer QX work into utilization good now QX. customers utilization. APAC multiple by good months. and to Robotics spring The before The robotics Egypt rebounding that farm in Canyon commence QX scheduled is our to to and will work affected slide segment, drydock to expected the II and clearance The contract with site is utilization for trenching and have Sea, expected is region. approximate to in Grand survey

Moving to is of balance expected change. the for contract production on facilities. with no HPX XXXX

the QX. take production expected We opportunity place Field enhancement have a to Droshky on in

XX. Moving to slide

million debt a as funded paid of of $XX our a the at in production QXXXX payments. is decrease also includes In by result our balance million forecast Reviewing The sheet, scheduled $XX million range. CapEx CapEx Droshky. forecast the loan. Our is January, enhancement is opportunity maintenance to related. XXX we million It principal $XX off of our project and the balance of majority to expected

for from $XXX and I the amount skip as will anticipate XX reference. Act. at in XXXX changes your the this it call million the a back of will slide CARES year-end comments. $XX million. refunds of the approximately for Our I leave tax result Owen We cash to was turn At tax in time, closing

Owen Kratz

Thanks Erik.

we the and to results. were withdrew our guidance we expecting continue. facing. of end XXXX, for understood in We focused that By we on into Instead that felt QX our recovery to XXXX predict. COVID-XX were Going the we the challenges QX, guidance expectations able and hit were began were possible issue XXXX not and to with the challenges

costs Our guidance. from people are did a fantastic to challenges lower and our able continued provide job work Through we able meeting our to were teams, we improve efficiencies. hard and our the

a largely were days the positive guidance we number proved of original protocols cases The course COVID-XX to miss in attributable business was we of price on the this but miss year in the worst, of beginning saw at operational first the the able lower the XXXX recover. to Gulf oil also a and of of the over meet with a Our successful Sea declined down incurred We Ops the spite issued overall, the the soft units big of last all Mexico minimal in UK. in Well utilization market slight exception year, to identifying it of as was in region COVID. our but and North collapse

a how recovery yet is in We Sea XXXX North will are but uncertain. strong expecting that be

some XXXX, challenges. underway. but the be again facing continues Looking is forward we COVID rollout to vaccine impact the on market The will

is our for do We work at happen environment, in XXXX. long green specific but is expect said companies. renewals. leads effect other degree. of uncertain this to hands. time volumes changing how up occurring may us uncertain through to majors remain and term effects the transition and happens see most customer may The don't budgets Production of expect believe to we work or contract Helix supply early smaller be that is E&P gas back XXXX in capital oil to increase and the energy what a be It the ramp stepping oil prices on in are is but renewables unknown. bit favor a not the this fields commodity to volume and demand focus shale is are and at in being dead. will certainly this gas budgets as but There of from where recovery producers our deployment for in anemic be the impacting pulling an will to More services on and know will majors time, in This what are quickly XXXX, many we in

As these subsea you these Outside spot rates. are Part for only are ever long issued intervention. now at contracts of essentially subsea contracts a aware, considered the have well of can we an market Norway, long well market. legacy contracts all was be term we three what believe entire intervention term

have support near spot signaled to It's face spending. contracts time the at some sector. We the also term, expectations market return with a recovery those that for uncertainties to are same entire our for to being long commit producers that a meaningful term now until difficult are long that can least dealing market the in occurs. our We that to simply recognized term

Our told And work the BP years, XXX we heavily certainly Gulf QXXXX extended. contract. also the over global term. their Mexico will a Instead, could there frame intervention be callout BP This will XXXX. for our in a contract BP five-year agreement rely year on days five believe up-to-date This are next with not two vessels region. from utilization on has per Gulf hiatus and Mexico would we fairly pressure will be put intervention in for while for signed of Helix the for a needs the for a the of be a with

Mexico of this utilization vessels for currently have our not there. are Given Gulf the transitional -- of clear means we on nature two we XXXX, visibility don't

in Erik for The and long in SHX Petrobras Our in SHX noted. other Brazil. the contract term SHX are two December, the as contracts runs

due anticipate minimal. vessel in be we to on this any is variance So would end contract The April SHX that year.

But will have We the Petrobras of April. SHX discussions XXXX or on outcome know to too after are the the in work for with discussions soon commercial it's impact results. these

We QXXXX for the plan This also by recompletion of to be of one the scheduled meaningful on the release vessel the following done have BP. Droshky with a is our Field. wells

recompletion likely proceed work early in will We QX. expect the

production and in but We with the it's intervention goal XXXX. are also soon to incremental to to estimate well have adding similar able of that revenue, backlog follow-on impact too acquisitions the be securing for will Droshky discussions on

robotic we the has strong company, market and but highly market, the will the offshore continue that anticipate do class seek remains competitive. work We the ROV into to from market soft. another On expansion side wind further trenching of become year

its contract Our Scotty following pick for to seasonal shutdown. is UXO in up of as much XXXX for were that boulder on clearance again, we scheduled mentioned,

other However, get another past site Several work and work we same be have the uncertainty. and last issues clearer as to yet how guidance. as secure much is support major don't withdraw we renewable of can year prep We position in these more to should want be QX.

a be quarter issues withhold to key QX strong guidance on expect are We relatively we visibility but firms until year electing quantitative to full up.

XXXX As challenging we us. be said, doubt previously for a will year no

this environment. is an we sheet of balance in our However, is once which XXXX, accomplishment in expect and cash do strong, to itself again be free flow positive in

will we be that have maturing with We pursuing. will to continue oil and the lower see debt. our CapEx our and gas we And feel leverage are service to recovery. outlined prudently market we great opportunities to a renewables, positioned manage continue to We space path in fields and well

Our period. fully nimble challenges good place very we team face proven as the being market expect as Erik? to through evolves and we be a has this in transition

Erik Staffeldt

Thanks Owen. we Operator, take at this time, will questions.

Operator

Instructions]. [Operator

comes with proceed. Simmons. first from Our Please Ian question McPherson

Ian McPherson

than no results guidance Good would guidance. Thanks. in morning. have certainly and rather QX shaky I Nice

ask But respect So XXXX. earlier, that I was to first QXXXX the decision I I wanted detail. year-end a as thought expiring just well.

QX rate legacy ending, current QX? to will not be Or throughout it this going at rate early BP, it BP is day So but necessarily be working on quarter? at day legacy

Scotty Sparks

that the contract the in mentioned, end towards Owen is outlined of contract. not is extended being as obviously so Ian, and we the happening Yes. now. is are now obviously the contract Everything

making think contractual rates And you continue so appropriate. the the assumptions existing that to I on is are

Ian McPherson

posted contemplating of QX? with visibility scenario the lack year's after to Gulf lack but work, only of contemplate analysis now early necessarily you you a as of right decision just the of, Okay. does complete lack are of ultimately one a your in And the Mexico, Droshky recompletion work then not vessels the the works for

Scotty Sparks

Ian, Owen. is I I then and Obviously, will off off it pass to the table. everything I I will start think on think currently

last it I expect softer think than general, be market we year. in a to soft

general, the before I steer vessel vessel, in to second our try one think thought filled get we on we it process to is, work vessel. would up that pass to

So that's table. a I that's on potential think the definitely

think additional think know and it it's we we see don't We market be for color? a quarter-to-quarter add if in XXXX. that be definitely to opportunities Owen, to you going I challenge into I QX. to expect want probably

Owen Kratz

sums and that pretty we it up can I be much specific. up think well

We putting QX what released work to are It's just get will are utilization in the anticipating work. is that do we once be our QX will going on right it achieve commitments. of to most from now, question. we But we the the

Ian McPherson

Thanks. And Understood. lastly Droshky. then me on for Okay.

the are normal we for will uplift production would relative assume be some from a presumably we there would Correct? but unquantified, bump that facilities CapEx on typical contribution getting So and we to some as in period. profit that also production guidance see recompletion yet the the and stable be then a revenue

Owen Kratz

or recompletions they is And comments, they a are color but as a don't. switch, light correct. either That's my I it meaningful just work said in recompletion

cautious until we going be So we know. to are

Ian McPherson

Okay. you. Thank

Operator

proceed. next with from America. Mike Sabella Please question Bank of Our comes

Mike Sabella

to rates Floating doing there, what Can down offshore. all direct you with down improving it's vessels? with two us as Hi. up. there. for Good looks firm of out of positive if could mean what hear down I kind us too morning we a little of do down to there you the down a early But what we but is know just it just appeared what everyone. through know I Petrobras should talk, just not like these I what kind to to of little you about I you like idea wondering a bit a anecdotes there? talk gone for are you renegotiations. happens give Brazil a you have correlation just of market the was know these of it's to coming expect work market out there lot what generally decide could seeing I is talk Petrobras seems

Owen Kratz

program be can want. do Petrobras rigs. I think the you will increasing and it, We that is their take to going adding add to if guys you and drilling

We already. that have seen

tendering by mentioned, Brazil, going by a long extensions. this their short combination limits laws or have the change which is needs. it's as made there been term second their what's think contracts But to And disruption term That's is Scotty extend and ability demand in it a in complicated further balanced caused consider I difficult. that we of in little on COVID by year there. a down multiyear XXXX the

into a and their for relationship It's are we the Year The We on legal term their And The requirements. We great. path with trying for Supplier to them of with fit good. have efficiency the think is they a in need discussions of Rigs is commercial have award. weave it. intervention won the vessels. matter now near

Scotty Sparks

Yes.

culture very Petrobras which think I commercial definitely They wells have thing the subsea unless And for with They discussions are we discussions are vessels. is in says, very happy like safety has commercial have They work. not and for of about one Petrobras. a do they camps. work. are Owen big need have the Petrobras a very, happy the largest

Owen Kratz

it's are with be come laws, the think of for going new to required the to tendering a tender also at next end year. out they I pretty apparent that

that Petrobras right with relationship I I in long to think along us that a the don't now all And term would intent they change was expressed these term. long expect that of Brazil vessels see as anything expectation. verbally

Mike Sabella

mentioned you know to, that type more is if of pieces split gas were in one split And those expectation we XXXX? the more Understood. And tandem? in Or oil you and ROVs the legacy in and work, the then into both type fall renewable directions? to were If they work what Thank was I year-over-year. this are different you. moving down

Scotty Sparks

a a lot that tender I market sector. activity ROV more think spot for we and ROVs renewables That knows quite. year see XX long time the the is sector. being We said, said last the in had have do renewables we everybody for very working

We have committed already for some renewables. work

the We us. trenching next up season And a APAC have have in vessels one of two the we years. ahead for locked strong of

very again to of project remember, and That So be days up the that full we had year. side will of last the projects to pick and only on site the XX there. project this it the the year glorious in last expect trenching business we side was spring clearance. year. supposed went renewable Please And

continue last be globally into we good as think ROVs service such I year renewables had little down we slightly renewable will on well. renewables the we a because expanded sector good. side. lines have And So be are trying But will softer will bit. be to year. renewables our expanded going Trenching And spot ROV and to market a

Owen Kratz

will bit, Scotty. that just I add to think a I little

work renewables everybody have said, you we a As contracting our interesting which and offering market recently tidal development. renewables towards expanded and The developing renewables. are styles on has the in is is The Almost more work market. Japan, in Asia-Pacific have an changing. pivoted captured

niches competitive the pressures significant. are So in different

the well implications And but the considering next expect about years fastest you Act best. are developments. So over of the Where growing, we I can in growing market see we play is that will be fastest few market, and happens still the But U.S. same. the wise, leader can else opportunities, am Trenching forecasted matter that largest it's renewables capture think the the and where the we excited I what the a are I global not we positioned U.S. the are and finding here. to exploring work. we to the those Jones international also remain of

Mike Sabella

us Can And that you guidance. XXXX you to If down year? sort neutral the know happens mentioned just kind know probably clearly the I given one Thanks. Do expectations it's end it. well, of I to then free the could the number you think can get cash squeeze from help you stay expectation, flow of Got of what next. this by of about and -- in as talk I kind more. I is mean, positive. XXXX

Erik Staffeldt

Yes.

of possibilities us wide of that very there the overall range because guidance, is a part on that upper about. close a talking to puts obviously range, think the haven't of target end the Mike, that very are the you is we So obviously given reason out there. I And

a we there specific said, uncertainties But are many is that haven't provided guidance. right as we possibility. So now that so

Mike Sabella

Thanks Okay. everyone.

Operator

Instructions]. [Operator

with Our next question comes Please proceed. from Cowen. Schumm James

James Schumm

revenues just Hi based back and qualitative to go guys. Good the be reasonable the can think absence basis be outlook, it maybe so, robotics on an morning. EBIT XX% profitable XX% given in you or assume year-over-year guidance, or is Nice maybe the year? then this step And we to down that that clearance? quarter. could down site If vessel you on the days down could the do just

Scotty Sparks

Yes.

vessels So that. we step one Obviously, point There site I down projects. the clearance days. a will had take will working at be on three in vessel

of they vessel huge amount days So XXXX. added into

expect of division do on revenues And down. also. come do to a the EBITDA. we the because we down But the will side So step be of positive that, robotics expect

James Schumm

do will But positive Scotty. Sorry, think this be year? you it EBIT

Owen Kratz

Are the robotics? you asking just specifically

James Schumm

Just robotics.

Owen Kratz

point, I think possibilities range the that's of definitely within Mike. at this

James Schumm

Okay. be this that in XXXX the And from below then EBIT guidance. giving said million prevents you the will I appreciate year. the $XXX you that market uncertainty But

million million it right that above $XX here? reasonably upper you this worsening boundary. could us about lower example, help the confident And outlook how Can now? you no boundary, maybe $XXX so stay could you So you appears to about all, range or are that wide year. like think or as assuming see help that for of no like think represent EBITDA at this Can just improvement be from us a the

Owen Kratz

that I discuss for major some issues don't now, swing factors. think because to us of be prudent these it are right would

to It's of success instance, or And For really a is Brazil, But the are light recompletion, in into about I get Also I swing because Droshky the Petrobras work has disposition putting switch. a the major not. to ranges. SHX. the impact. those cart going before the the now. horse of it's market as said, you that factors which the either nature love wouldn't of of just right ludicrous some with both telegraph meaningful want

James Schumm

All right.

right. Thanks All guys. Okay.

Operator

comes Please Evercore ISI. from Our next question proceed. with Samantha Hoh

Samantha Hoh

the wondering is too my this you surprised but realize another especially and or Hi mid-size from time in not state that sort a where commodity guys. the maybe even if of sort could private kind far commodity the of being guys of may the overly perhaps uncertainties. you this I if operators the talk by I there Gulf urgency be oil just customers prices? whether potentially prices just heightened intervention lot I Thanks levels? of feels work commodity was customers curious in are not there is Mexico? current you as for is taking obviously But just markets at you question. wouldn't by -- strengthening is were demand, in am for surprise are reminding time brent Curious of a past these about in of see if another cautious am any taking or surprised maybe just I smaller where like pickup just history strengthening of

Owen Kratz

it answer yes short this there. be first before, we seen have as expectations is we where The was come back. to comments, North but no. would our That and stated The Sea, the the in most our impacted

number of a producers be you aggressive that lot the more have a majors. smaller think I than would

that small fairly to sure drilling. even uncertainty robust among But So large strong how of the to supply the thing have Mexico, not but are Sea Gulf be. just compounded know There of what commodity the this a continue. that don't majors to we means. actually more either. expect, will the prices year. new continue market expect XXXX, we producers to the little in they we lot you same smaller on seems and XXXX. what In bit both are and to be as that for North the Talking up anticipating That's We a would to moratorium as tighten a from pickup demand to a regulators, increase and transition producers, so the setting exactly and administration's by means it's

which put it result, didn't and during process freeze the of a it as sort it's this came on right budgeting help. So a year,

on as not as And sets back strong that's that down before, happened And last early to say it or the or XXXX. to tell strong. it's whether cycle. get higher the I hasn't So of is My not even would regulatory commodity the shale occurrence would be that then up of as stronger a producers not XXXX going bit production we it that would come uncertainty. whether did start top the and XXXX, in that, anticipation think beyond I the an that in anticipating an back for prices come

of strong as that's the time. as anticipating So sort the recovery shale cycle be it that last but at won't was looking the last

Samantha Hoh

we think this are ahead. -- go I in

Sorry.

Scotty Sparks

increased seeing seeing of activity more are well. as are we that internationally. Africa and also of before region APAC saw tender and than out We tenders activity out tender more to add the to we Just the U.K. geographically

Owen Kratz

being right I we towards well just producers. reallocated seeing renewables from the gas. our OpEx budget add, is mind now intervention, oil to like market, of capital spending away keep are would actually also in and and But under

because be very So very production some the very aggressive take these low over and supply as intervention are ramps take up is can't it But operators CapEx fruit and time quickly. it for on fields, intervention meet a hanging will the and very, going to again. side as to demand new the smaller they up ramp the

think for it. are So I well-positioned we do

Samantha Hoh

just you other with a question wondering And sounds maybe just lot the different there if have incremental is just that is like handy? COVID. the that am to implemented, being My on of Okay. number sort of you I us could carried, measures side? COVID quantify whatnot. if All like you think cost XXXX, what was and contingency you it costs impact has of for kind in the curious do have planning of I

Erik Staffeldt

that. And they take put for of go place said, lot all we protocols in a personnel of before will I we So testing our offshore. have as

XXXX of million. is having cost can people offshore. in quarantine medevacs quarantine certain $X go before when in to of they do have roughly the testing, to countries are and we about having coming And around We to

Samantha Hoh

full the for year? that's And

Erik Staffeldt

quarantine fact pandemic moving for the couple doesn't had on $X stack and But But cost about boats. was million. year of That's a Yes. is significantly. actual guys since lost include operating the those boats full and we testing, we of Obviously the the that to that revenues the down some cost started. around

Samantha Hoh

you. Thank Okay.

Operator

question next comes Simmons. Please proceed. Our Ian McPherson from with

Ian McPherson

the follow-up. me Thanks Erik. for giving

see to for what and wanted And your then that I fleet frame like CapEx? XXXX what ran this CapEx if the looks for operations, expense you vis-à-vis the not guidance the you Before was drydock across year? the for me the drydock XXXX that could through ask K, slate

Erik Staffeldt

Okay.

the least had in $XX Ian, approximately first five back were get to So That's million amount the is just I number think that. the And on the to that roughly But weighted recap. that at I want that In say you think to we the range. drydock. would I to heavily flow vessels I XXXX, to like of in part operations. year through

spending As XXXX, $XX in we CapEx. CapEx it look the at is our range Majority is of to maintenance million. million $XX

we we as one this have scheduled is far know for and definite. drydock, a that As that year the SHX pure

million, it's maybe you, would would probably XXXX. probably tell in operations the through I same flow the so high-end that $XX million on in And $X maybe low-end the on potential,

Ian McPherson

Okay.

a downtick going midpoint this operations light through year? probably So drydock

Erik Staffeldt

Yes.

Ian McPherson

it. All right. That's it. I appreciate

Operator

time. at There are this no questions further

Erik Staffeldt

on joining you Thanks you. April. our your us operator. to much participation call appreciate forward having quarter XXXX look We and and first Okay, Thank for interest today. very in

Operator

lines. conclude call your for please you does Have you for thank That and the conference a today. disconnect great your participation ask We that day everyone.

Helix Energy Solutions (HLX) 23 Feb 212020 Q4 Earnings call transcript