HLX - Earnings call transcript Q1 2021 | Helix Energy Solutions Group, Inc.

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Operator

Greetings and welcome to the Helix Energy Solutions’ First Quarter 2021 Earnings Conference Call. [Operator Instructions] As a reminder this conference is being recorded Tuesday, April 27, 2021. I would now like to turn the conference over to Erik Staffeldt, Chief Financial Officer, Helix Energy. Please go ahead.

Erik Staffeldt

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

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

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

Ken Neikirk

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

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

Owen Kratz

operations, for balance well, Good and our safe. morning of our our outlook current and staying morning, healthy doing their out are the QX We we'll performance, view market and dynamics our of provide review everyone. This there families the everyone hope XXXX.

presentation, our the a X, summary to X Slides through provide high-level of Moving results.

teams expectations of operability. farm with The Our clearance and high at the performance in mid-February our in to was end QX wind West at work Africa. execute mobilized in Enhancer in we line warm stack as for re-commenced from continue site the North QXXXX operations successfully The Well the reactivated was of levels quarter. Sea

the with HWCG response services On a our agreement QX, services. traditional entered effective our returning we sales front, agreement retainer-based new into more for to for

until vessel X a XXX We continue now also working albeit additional extended options thereafter. Brazil, will Siem in the mid-August days rate. reduced for Helix with The at slightly

the for net Our million generally were results And XXXX. EBITDA first of were $XXX Revenues $X a results quarter of million. fourth quarter consistent loss million. reported XXXX of $XX our with from with

a Slide from balance with additional Our On work gross perspective, million end at X%. quarter short-term cash $XX or profit to temporarily X, in balance in $XX sheet for our a cash $XXX LC associated the million an restricted with million the Nigeria. our of was was

with flows remaining to million long-term repaid $XXX resulting generated of balance During spent our the We of on loan, million QXXXX cash first CapEx, on debt flow operating million. the free we $X cash million $XX our million. $XX reducing quarter, and $XX

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

Scotty Sparks

good morning everyone. And Owen. Thanks,

Moving on to Slide XX.

the remarkable partners like Yes, job. offshore operate team. challenges due thank and I onshore to an to teams presented, COVIDXX environment entire respond to operationally to and the doing for would and continue by our well to extraordinary in the We Helix continue challenging pandemic. a

Safety office all our our locations. Houston safety procured guidance for measures reopening and and and equipment place surely stage We have return. have put regulatory return expect protocols of some in in offices work COVID-related process now open our we designed been local have in started safe to that our locations a in the to to follow headquarters access

excited onshore times restrictions, great to COVIDXX and nearly teams very return workforce in remotely, testing operations has to job working presents they work and with are I pandemic keep meetings quarantines, see date. personnel including and many challenges, internally to on communicating vendors done Our know into our still XX,XXX screening functional. the a our clients offices. our The logistical and all calls travel

We situation. rollout our easily vaccine available successfully have the work more investments disruption the aiding despite Testing now quarter, transport continue logistical personnel to challenges. to to operational first globally continued operate the In is is the with and offshore sites we globally. minimal

As is cycle performance. rebound signs be of to awards driven anticipate in and and an we XXXX, the market execution show beginning contract will up by

incident efficiency rate. with We extremely uptime performance work safety XX.X% continue and to a high with leading to at standards very recordable culture low strong

million of seeing million conditions, in and of determined we utilization. $XX million, first winter utilization of to leveraging to to QX operating these quarter of we million producing million, for revenues with $XXX intervention quarter, XX% to warm gross quarter lower gross stacked utilization Gulf of of the the both in in the had million fleets QX, in seasonal continue North when the QXXXX chartered-vessel the contracted $XXX affected for be And we technologies one quarter. are Robotics the Mexico, for achieved the the the $XX and achieving one COVID quarter, compared capabilities, the EBIDTA produced, as XX% to utilization XXXX. In and the Sea work. conditions to North $XX XXX% Over QXXXX weather XXXX. during whilst of our utilization usual resulting due revenue globally achieved of Enhancer continues a our we a Enhancer in Scotland effects levels margin region, QXXXX Though reactivated of the compared Africa million for gross consistent its provide. fleet utilization the business X%, being quarter pandemic. pandemic most of completed and quarter. operations to and totaling conditions, West are with remainder XX% personnel and In quarter. and operational The profits the gross Well commenced we seasonal days Considering the of first XX% were utilization of Mexico, during Nigeria the for quarter. working leader we in profit largely West in Well performance QX leave weather of the million in bumps $XXX the Sea first profit $XX of most by produced vessel Africa the for into million back fourth to XX, services XXX $X drive The mid-February In knowledge, We stacked, market Brazil, working transit through was warm Slide Seawell the and globally, and the as and first seasonally the and and quarter. do, harsher profits in entire winds $XX revenue the Gulf The

of and Canyon and Intervention until in QXXXX completing two in high alignment working works rest undertaking with renewable working to XXX% performed wells mid-February, XXX% a as XX% another in utilization, for mostly operations salvage Robotics the utilization well The work, remain the the globally, BP including in Mexico. operations our clients, business QX. remain Brazil days primarily BP active a trenching client. then ROV two review five XX for Slide and more was BP support, on between ultra-deepwater vessel our remediation XXX on the for well, attempt provides utilization, quarter, detailed vessels. due The for completing fleet between was Grand of undertaking work well. high one the contracted extremely into had demobilized ongoing in for work of and abandonment performing the quarter. utilization currently enhancement Well both projects, production in our for Gulf well of is standards to continuing in achieving between into work this abandonment one on client chartered-vessel schedule at well flowline will equipment undertaken another QXXXX QX, gap usual Nigeria Performance in performed activity. So, it's vessels third very The while ultra-deepwater

the have third [indiscernible] And have First gaps vessels the as increase between Pleasingly, projects. very have one Gulf vessels the we of complete an work quarters. in in working Helix vessels both work team. well personnel we with seen and of some into now key recently visibility for integrated QX fourth and from awarded have activity Mexico tender into

time, the uncertainty of degree be is to this at However, contracted. still work a there for

commenced of parts The Well stacking work and including COVID, of most opportunities stayed harsher one for for the has then Intervention significantly Moving two multiple in North one the for seasonal Well than mid-February was as quarter, works working times, reduced slower leading in followed vessel continues enhancement vessel enhancement scopes in client, which the to achieved Seawell. visibility weather reactivated continued production to completing is stack lockdown warm XX, by scopes and other government-imposed business by markets mostly of stacked Well QX our affected the suspect reduced The two the east The period Scotland. previous been Slide operations. clients. to warm for related reduced minimum into QX warm due in XX% in Enhancer to be has Seawell allowance. in for usual production the we the utilization clients levels Enhancer to remained and the manning Sea The to booked mostly and crew Sea operating clients. costs return The North Scotland to in in

will vessel The end and January. will working end contracted work have we well working in repairs arrived vessel vessels in QX, work awarded Helix later extremely that at The vessel for has reactivate on quarter, early worked with been potential that with one West a this recently wells and integrity zero However, and commenced QX and wells. enable QXXXX contracted multinational visibility the three the toward Africa scope, integrated QX. year. enhancement the back of become works QX Jline contracted work in in us the performed four The on Nigeria production commercial the region to expect in team. we of The downtime further Nigeria we into have

well, X extremely on in work strong in safety, regarding Siem completed operational in extension utilization abandonment the of had uptime XXX% go X Siem commenced excellence, continues Helix wells efficiency. then and the again to quarter. operations two work on with Petrobras strong vessels producing in utilization Brazil. Brazil and in The environmentally Slide four XX, to an enhancement Helix performance Both utilization The XXX% completed protected continued the of Moving and the had XXX-day quarter The area another for achieved has our a vessel wells been work and four of government wells awarded northern on during contract quarter. coast mid-April. production QX,

for had in the working fleet XX, in our the free Gas year Robotics salvage after of Slide projects, quarter, quarter and non-Oil solid to resulting good another a vessels review. Moving related and primarily XXXX, XX%. renewables during Robotics operating chartered-vessel utilization on

after to projects period. the dry-dock The pipeline scope trenching scheduled and vessel completed North III Grand quarter, quarter renewables the North maintenance to a for back was Sea project and renewable Sea, and transferred During taking in renewable utilized short Canyon trenching then in first trenching an for the trenching. and additional undertake to the then BP a oil and early regulatory Egypt was undertaking XX% the transited gas a

[indiscernible], We for an Guam farm take region. and in work on secured Mexico, also a expected support works has the of offshore a II [indiscernible] the to The going performing expect days in North XXXX QX, also and into a for ROV vessel Sartor, had the in contracted we commenced the days. provide XXX% survey QX. the which in the that energy We've utilization and renewable to would In ROV installing vessel site of three the our mobilized project quarter XXXX on wind work of APAC to recently a clearance In Grand early then approximately this in Sea Gana a projects works QX in that salvage project, APAC service is first tidal mobilization for turbine. spot vessel mobilizing vessel forward year. Japan XX Gulf we of a completed Canyon region, last a on the vessel

renewable sector. previously, mentioned the the further to have Robotics renewable each for plan activity year have group XXXX. As continue into from XXXX transitioning of currently to XXXX and works contracted up our agreement is to We tender trenching

renewal, boulder support, and renewable other activity include accommodation support. XXXX survey, site for We clearance UXO installation also have detonation, removal, increased XXXX tender trenching, services to ROV from support debris to and

ROV contract to XX. XXXX could I'll spot that awarded for of slide trenching Over vessels leave us detail to utilization in operations vessels. service this may require reference. your in and be Some which Slide the for

Before seeing personnel and again like our call soon efforts There to the and up Erik, doubt I onshore XXXX circumstances. our We personnel, offices to for great manner. I Helix in to our under turn keeping teams challenging these expect challenging. controlled look team, return forward is to our their be global over our continue would a will safe we Helix thank offshore for to partners our no

However, the and in contract we starting Gulf to work it North Mexico. returning that to is have of now pleasing operators in Sea seen vessels the

awarded be We and this towards to get we beyond. year could visibility are starting better where

much contracted. work be However, how there will uncertainty still of is some

international We Pacific strategic and that our the services, tenders are an in for West Brazil, increase Asia geographic for are company. especially also in Australia seeing goals Africa,

Erik Staffeldt

Thanks, Scotty.

that our million XX, total maturity Moving at funded December debt XX. from our at and down instruments to $XXX profile [indiscernible] the $XXX million, decreased outlines to March debt

During its at loan maturity. quarter, we the in QXXXX the full repaid

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

Our million net at quarter debt approximated end. $XX

quarter, of million the debt. $XX approximately During repaid we

debt accounting ASU XXX reflect treatment simplify early notes. Our balance adoption convertible our the net outstanding long-term of at balance XXXX-XX of and debt the which

temporary include project balance of restricted cash $XX $XXX Our a that end does was cash at supports the million. position LC. of million QX not This

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

to Moving a continue outlook, very market. to our in operate challenging we

expressed, more challenging XXXX. have than shaping XXXX we our for previously to is As up be business

current sufficient slow a within positive XXXX a for into we the and current caveated, time, backdrop has The providing Our orders. of are feel markets, our appropriately issue have as positive is customer recovery At attempt we stable cautious this The our customers globally continue primarily develop relatively committing good-faith information investors in been to a to we in be spending against has XXXX. backdrop provide very guidance increased but and macro best environment. interest, to dialog in in beyond to can, foundation developments XXXX. to firm the sector but visibility that

million, of free We are $XX guidance million million setting of million to results. $XX the $XXX flow million. $XX our Revenue million, cash is range XXXX in between for $XXX $XXX EBITDA to and generation and

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

expect will Brazil, in North the of Well Siem a vessel vessel. of this may we expect have likely remainder spot of weaker We lower using asset with will the a a visibility be December, most work possibilities site Intervention season, expect X follow-on XXXX. XXXX. one working August consistent. generally Mexico will vessels Droshky should Robotics contract the and the into production to at QXXXX on on Intervention thereafter. time. We market expected the with the year activity recently facilities dependent levels have business, clearance deployed into Siem Well the gets idle April There Helix rates. utilization contract potential the Helix the performed We in we In both Sea work on in with for recompletion a be second less In work in market. whether Africa, our vessel at reduced is be the QX quarter-to-quarter Production basis. In year. year to The for be the Gulf on into strength West is X is expect business, of now of the

on and December North segment potential with Intervention into early dry-dock was Helix warm is is more color remained or to be were XX- mid-year. upside is vessels indications QXXXX for contracted While QX the of the operations Providing with in region QX. is [indiscernible] has XX the Both appears opportunities Well QX. BP contract under stacked to X now. QX. contracted segment work gap additional and Droshky Africa expected. the contracted Mexico contracted the to in UK QXXXX our are into work completing schedules into work under and work May. on have Slide Enhancer by Gulf the smaller. successful, earliest an Siem QX has QXXXX opportunities operational Well have Helix Siem West contracted Brazil, scheduled approximate mid-August last expected Seawell into XX-day in into The Sea with X to and into

in slowdown APAC sold by Robotics is affected expected but for good clearance winter contracted trenching likely of the have III strong our Canyon to the in to North be site work Grand the segment, and that wind QX Robotics II in survey QX. XXXX utilization XX, will farm rebound at into of The the and expected end and to months. is contract utilization and region. was Slide began the Moving The in work with Canyon follow-on balance performing summer Sea in spring Grand QX QX.

no with contract balance million majority new maintenance debt decreased of project Moving in the our range the forecast It enhancement to is as retainer-based April. more million entered scheduled services of includes in The agreement facilities, returning expected response related. the during traditional $XX CapEx result also performed CapEx QX, to expected opportunity HPX Slide of principal forecast our $XX decrease balance production to an sheet, loan the and of Reviewing the repayment additional at of our with a payments. Droshky our million XXXX $XXX change. funded is effective for a same to for million the range. $XX balance XXXX XX, HWCG on a remains Continuing We agreement. with into the production on with QXXXX

the was received LC. does of a restricted million Once it refund At $XX closing your XX time, tax not Owen? Our in XXXX turn leave cash call $XX changes reference. Act. million comments. skip of result QX a additional cash an anticipate as a $X for temporary that million. $XXX the tax again, the QX this will of We Slide CARES from to supports million this project and for in include Owen position back and at the I'll I end

Owen Kratz

The XXXX Thanks, to market be continues Erik. challenging. for

and beginning market but a seeing in are headwind. to service remains sector green turn, strong that the We is the shoots oversupply signs

increase volumes tendering like in business for abandonment get. Commodity seem are all These for a for work seeing work for deferrals about expectations on We is are understand price positive We to that level term. indicators discussion positive. difficult are more producers and XXXX an beyond. macro increase. on There the long our

However, itself reverts challenging in The the balance seeing to finds historically steps back in We a shape. Helix we our runway so position. our balance took the as the is sheet uniquely by legacy same the relatively wind down recovering, market are a three to debt market. pandemic convertible traditional long-term contracts to market rates their is early time, with in at spot in refinancing provide sheet strengthen slowly our good longer

which reduce in hydraulic interest this Petrobras at maintaining continues near increase sustainable been assets, in we we actually gains but to The Brazil, position extended expanded West Gulf the significant We've they Gulf other historic there. in Brazil in efforts receiving added West to to offerings the our law. hopefully markets; The to services We're we in a for of Our what could Mexico. operators our credibility say current market and been we signed QXXXX future market see volume our North markets. capabilities and solely translate include vessel lead have concentration that are contract UK, anchor working share for geographic both a presence one, also work and as Africa, it's Petrobras, in two, expand Sea, required lower preparing the from Africa. expect a costs, footprint riserless four the to the SHX progress. be to Mexico leverage significant sustainable West our are efforts while pursuing region. to should pursuing we're with good in client believe Australia our our an with the Brazilian Number contracted to Brazil into year – year-end. remain contract We've repatriation of but recovery. Brazil, focused that relying Africa position in potentials our April, in rates believe are our could by tendering in and not and still which demand We've service avoiding efforts on: to to three stimulation to feel other could allow We're on scheduled later internationally. retender retendering Petrobras from in are We

seek in time turning offering. to when abandonment producers continuing Droshky. opportunities market similar while deals property is to a we're are pending, prompting cost of of of are becoming Third, high, mature best our expectations concern expectations these the abandonment greater to of offers are more achieve the indicates for interest Several cost for

and Our work. this beyond confidence wind execute clearance. current to and mentioned decommissioning our aspirations in site underlying expand business to model grounded involvement the and are market for, offering trenching the in offshore potential the bid our our Four, analyze, the in we've

opportunities see continue continue in the growth We Trenching is it potential tendering ago. capital work. the significant the more bread competitive – our appears in actively seen than to be We've will amount mind about our two to Robotics. wind and the butter to see just returns. be years achieve farm it sustainable chasing There uncertainty but projects, to will tremendous in is of market that are clearance

positioned, progressing well our but to may still progressing growth hopefully the rate. is that, With will not be us but evolve. I'll our some simply our initiatives, offshore and it be are longer cautious be Erik. on over required. for improve continues wind, be an ESG turn but a patience to sustainable market at we'll a will profile, back We albeit to Helix slower and exercise healthy, for plans as more This area,

Erik Staffeldt

questions. time, Thanks take Owen. at Operator, this we'll

Operator

Please Instructions] [Operator first comes Our question. the question MacPherson. your of you. Ian with line proceed from Thank

Ian MacPherson

everyone. morning Good Thanks.

Owen Kratz

Ian. Hi,

Ian MacPherson

or to guidance production revenue At wanted XXXX. decrementals Erik, think of got I the resiliency severe walk on the like XXXX drop about you on EBITDA revenue XXX% Owen it EBITDA on from the you've the intervention year actuals – fees, looks midpoint, about And across ask circa facilities the this decline. robotics. Owen. when decrementals and the to EBIT Hey, the

rolls chain as And big well? And be the there's that this that And from market a we Is and we well. cost suboptimal some recovering headwinds that leverage component. are contract these as this a XXXX, so, we're to should well. have think we witnessing relief, know utilization structure know that that a some within COVID operating when the there there impacted now disruptions as is globally leverage into would seeing and you in of hurts Are year your and also factor you your getting of decrementals? inflationary hope about legacy business the think energy also supply I

question the recovering headwinds So, how a or non-recurring I'm is, when there year? you is a next structure into maybe cost about we ton in abating think but market your asking that the really get what

Owen Kratz

The answer is yes.

Sorry, don't you that is why a take this? mouthful. Erik,

Erik Staffeldt

the I from big try I'll different question. components address your – think Yes, of to a

it that the pressure don't we're is on you're seen yet. we've the pricing say feel I I that talking I our structure. the think cost or or to starting more guess think you can headwinds for the get about see,

haven't seen a that definitely I our we But potentially it headwind results. there. out think recognize We it's is in

going the see Owen XXXX off contracts into you what as legacy roll the XXXX mentioned. from really of think is I that

you really us. could impact some think I see seen – of that's that So, the has

think significant. you I – the impact fleet of on the as our mentioned also is utilization

have I we of on utilization think we being to I in felt. impact still impact North utilization, our is the dramatic that on that of get And see the results. levels when lower think a Sea COVID will our obviously

I impacted think we be may we'll get an but indications coming it there. be end, does, still that until that to

previously basis the are I for amounts we COVID that a incurring mentioned additional think had quarterly Scotty cost. on

think to I – to in least if our those still year. $X think I not that's I cover is million I continue that at seen of of abate, to I'm quarter. probably have the we're starting it points. a for sure expectation was most million we'll not did. $X your I balance tried We mouthful. know per this

Ian MacPherson

recovering you no, SHX agree market my will last and negative the fault want to It kind beyond I hypothesis that recovering did. the see a asking really, with is for that question. mouthful if pricing my role Yes, But that of for if we find just and decrementals that depend for back kind those I saw pretty incrementals severe year. utilization could confirm opportunities several is a of just next from was year, on – healthy those buckets this be was to wanted as really swings That we you your improvement.

So…

Owen Kratz

the the big and it's the budgets – additional spending. If about the operators in the until that's always price didn't spending I also, a a was little I for know think work just difficult occur not said if something, environment problem. set stabilization impact current this that If very could year COVID. commodity I of Ian. to add it's in I of this lots back for, past something But been and budgets the were after the mentioned on the calls, go ask is for budgeted

But lot that's awful of there XXXX. now that's dialog is, done So is impacting right, an what about you're XXXX.

snapshot, I expect So, would to a XXXX stronger. much be

increase We hurting what's but have room are fleet right in now really our in for utilization, rates. us

rates. the the out We're where some the does of people coming increase market. scarce so you in in industry not we'll as but on the we that seeing broader downturn, every increases cost non-oilfield personnel. seeing always We're become see cost related some of skillsets in hopefully XXXX mentioned, with escalations So, compete

not here with the to costs intervention me producers say market we because lock yet, on to, is but have seeing rates in uncertainty low where we're blessing side, to you'll to in that spot going. leads market multi-year a gas it the certainly and about the of of looking oil the sort On which for disguise the expect return are

So, I what XXXX. we're think put starting rates we're for trying to and out giving be to very cautious about

Ian MacPherson

Africa you different like for follow-up. – the options hear. now Okay. two contract well other have in in Australia Quick in QXXXX world. saw need or one West Good news you to the calendar of sounds strategy and it a or the parts the We we're you compensation work Do that have get Australia, choose today's under-appreciating mobilization as maybe or do Southern to market?

Owen Kratz

together seasonal is from very, long. They work very a transit basis. The well

will things be sure campaign to to turning be going West I'm annual year-long now, demobilization mobilization clients. every sort from the if puts we whether other well. of So, is like year, always to get pricing not way it's which campaign, Africa right an some The not going a be out looking or are or

like other regions – shaping have I to up think look utilization vessel. but for a they both are The

intervention sure we that in each So, QXXXX the other region, vessel would would I'm then be in its And North the of in and which work not are – the going it. in repositioned out I'm leaving the we vessels short of have unless guessing for campaign sort you're following Sea in are heavy in the tendering vessels Sea there, Australia. one scenario, one a no the market there North we took we and vessel forward that case from ideal Brazil

rethink we where previously require us we're successful our international haven't markets allocation. becoming been to So, very may which in fleet

Ian MacPherson

color. pass I'll helpful That's Owen. over. it Thanks, Good. Okay.

Operator

Sabella. [Bank Our is coming of line from Mike America] Please go question next the ahead. of

Mike Sabella

everyone. Hey, good morning,

Owen Kratz

Good morning.

Erik Staffeldt

morning. Good

Mike Sabella

are renewables, year. think talk XX% of things guide talk us of as moving of we of either how you just split segment. in XXX through year? we for to the of this those take you could there, what that the kind out to you We've places? – Can that guide, got of about revenue XXX of that see think bit then kind guide Robotics. high year Last of Maybe you the for a just low this some the the end that end And guide,

Scotty Sparks

So, I'll one. take that

You two year renewables. had were that have on up went for at of undertake quite last the and that that year that clearance three clearance quarter bumper remember this year Most vessels. site to of hopeful the will and the whole what, last the site will vessel being and for for some market we we we least That market. have supposed one tenders was be projects to months. year for possibly It out project on. one we'll have works in nearly, ended other site work trenching clearance on work This extend

would XX% are say I we the of still bumper trenching. site seeing from So, set last of lower clearance project. renewables be would a year because guidance good

an We take work are will in trenching seeing also we renewables have for vessels on uptick ROVs our four ROVs in requirements that renewals. contracted have be then we or renewable eight And to part in sector. the work. ROVs in Currently,

ROV the renewable it place. side. all So, guidance will a we ROV project first the going We And that now I But projects but for That's set slightly comes vessel a go Exxon. a on stuff I side think that. XX-day have to the lower a didn't then in visibility then good in so QX. won And our in vessel and right up. there come off have be on on any project, other is the But is think be – just we'll things these time. take that Guyana cable lay other

Mike Sabella

the could you QX mobilization cost clarify cost an what quickly is you us flowing of the to year Can idea think back just what number through? just West we move thanks. And then cost circle you Got to give to can headed – about the from included is it, how in down should Australia? to And Africa that Australia. this the it or

Owen Kratz

this early or really in chasing continued is Mike, the year, think West we we're I that timing dependent the think year Africa. from some first I transiting next on of whether standpoint, start work

there. is there think I opportunities

call was working our I West it to vessel mentioned Africa. think the in have all possibly year in

that be work. timing of of some on will it add-on So, dependent the

I mobilize, when the I the think roughly vessel will be, transit think I believe… does

Scotty Sparks

Its XX days.

Owen Kratz

About XX then now, amortized to and days that a to cost we in subject are will transit over be there. anchor existing contract The the transit FID. revenue place. contracts happens and do when there that – contract potential have Right deferred the

a in we're And there. so, it's place good think – I

Ken Neikirk

complicate for that was we during this original Australia. stop which it further, knowing not that the bottom entry to – is bottom, period though the the is on Just there of paint requirement vessel, for required In Australia. delivery transit the the a finish did knowing the dry-dock for into a vessel,

that which would So, cost dry-dock time there budget. to will a capital at stop portion for the be the of back revert

Mike Sabella

it. Got it. Got

Australia, year? in is – this no no So, perspective basically that from there impact from in cost there guide a is either contract the

Owen Kratz

correct. I think that's

the in think Africa West which our now the right transit to QXXXX year in I guidance expect begin its deferred. we toward either the year would would be the end be working or of entire

Mike Sabella

I one twelve can perfect. I incremental from coming XQ? which there year or you ask CARES million Act, it's in in seven said just the is million quick of And – point was more million total, think, twelve then, Okay, this Eric, clarification? of collected there's

Erik Staffeldt

additional. million twelve No,

Mike Sabella

Additional?

Erik Staffeldt

in received or it I Yes, QX. million nineteen think twenty million we million total, seven was

Mike Sabella

Perfect. Thanks, right. All everyone.

Operator

question line Company] is [Cowen from the Schumm. next of go and coming James Our ahead. Please

James Schumm

guys. morning the just you was on good I on terms? Helix X reduction percentage comment Hey, Siem could wondering if the in rate

Owen Kratz

request We've rates the of out never Brazil given the in Petrobras. at

with the basis stick significant. vessels The of the the keep that. year the and to in process. this extension it large But region retendering merely working Petrobras goal in we'll avoid percentage ahead of costs of think I it's was repatriation So, Brazil from the a for

expect wouldn't that. much from I positive too of EBITDA So,

James Schumm

or after expectation you day completes then And that And think are go XX Okay. Petrobras guidance, you have the to a You fourth in the back or the not, the level your contract about. assuming mid-August? if some XX quarter midpoint for of so you dry-dock in maybe to like utilization talked we work there? then, of about what's

Erik Staffeldt

on that end the guidance not. vessel work assume end, in obviously So, we yes, of the would assume, additional the correct at have some for range Jim, low high would I we the but the think we that to it's

James Schumm

my HWCG part year? the you expected that, benefit of just one and Okay. the to could QXXXX customers currently And then as or quantify question, your utilize guys – customer this the of is if next So discounts? QXXXX potential then and

Erik Staffeldt

like So, retainer we traditional a base. to, returned more said I think we've

operating, been I a we've we be impact so think we I traditional. levels think positive I previously. are the think more discount, quite we've that two to extreme It will don't – were years at gone essentially we're the at that there. result, production in fee will extent the our that The to said do to – I we intervention we assets the our for members. to has extent XX HWCG that believe gain retainer reduce facilities the the utilization well

work And do members basis. go-forward so, I we would some to think for a on those expect

James Schumm

back Thank very Okay. much. queue. you I'll in get the

Operator

question line go from Please [indiscernible]. is coming the ahead. next of Our

Unidentified Analyst

little about XXXX? and going some of see the do that is work Robotics a less trending you you. to is take midpoint talk actually provided? type guidance? you circle that you for be oil lower to and that good – the like could I the year-over-year of year-over-year a of roll-off you gas traditional site embedded or If impact If looks year-over-year the Could of revenue revenue's Hey, activity clearance work in segment XX% thank had back big and XXXX, you the the oil gas in XXXX. bit for and activity guidance or type traditional morning that guidance it into down that Is piece higher

Scotty Sparks

think oil it I with par the more side. activity. last will on be gas year and we're on think I seeing But

whether it's works tenders more fruition. there's come to going So, or not those on,

we're spending the money definitely site some very for the operator’s this upturn difference the from for and of maintenance There We the to lead we an and big ROV and market in project gas trenching in talk the are going oil more and bumper coming more the to related requirements XXXX our and trenching three time. had. gas ROV two seeing side. that oil on umbilical from will work, but at There tie-backs boats. still year more it's in again, clearance North works [indiscernible] services is pipeline XXXX is and Sea seeing last traditional But be requirements to is spot more that slow a stance on vessel

eventually, not to, seeing. think will have they I but we're

I be would year. par would say So, last on with

Unidentified Analyst

about enters the or lower the Okay, into the trend be to thanks these for – returns renewable getting same And improving that. business markets you that of as competition opportunities the XXXX. achieve possibility in you versus of picture. talked At declining pipeline higher to tendering that said more into for XXXX seems time, continuing some to sustainable

Just tendering us sort about sort XXXX in now that could from XXXX it a for of renewable think you're you right what seeing it type if for already of booked equation? to that on think tendering of activity renewable side par you with level that XXXX? in help Is about we Is of of volume help activity? the how the activity Just less? thinking did activity perspective, the much compare us and you're

Scotty Sparks

So, becoming for tender renewables XXXX We've for thing work secured activity to wind works XXXX seeing, in and farms in trenching. larger. XXXX for XXXX. beyond amount these out customers renewables of we've of good much We got are through one huge And trenching. a partners in are ours, with tender to usual had we

wind And and offer farms. scopes of some larger. the are larger becoming So, site the that offering, we're with services other the that, clearance trenching

in We If so tender onwards from there projects. of was increase. more And job that competition, rightly again, these there a you year have should a Owen in This commodity, some won work. clearance. us. tender site the farms and prices XXXX larger look But coming volumes for going There's to to of clearance back site this getting XX last the as like year, we amount should is are wind it competition when we And space. had clearance great huge it. any of at looking We that's with one in win all drive down. says, is site people

profit, So, guess. more I less volume,

Unidentified Analyst

Understood, thanks for back. I'll it that. turn

Operator

[BGIT Research] of from line coming ahead. Our next is Levi. Igor Please question the go

Igor Levi

morning. good Hi,

Owen Kratz

morning. Good

Igor Levi

up roll-offs. be QX the in attributed levels, from to following QXXXX would versus some proportionately vessel provide $XX this million EBITDA, of color guide the the you contract be will cut on Could on Ian's your half mentioned and million implies attributed So, largely to XXXX this in question $XXX you EBITDA – and quarterly much of to Brazil? this is more how the that

Owen Kratz

the and legacy the So, QXXXX the guide QX their giving of Helix annual when our guide at we recognize roll-offs here contracts. look in an Siem I think one you once and from we're – again,

is I to basis quarter at into going and look you a think be environment. entire on year, we're a quarterly we spot-based said. when more Visibility like the leaning

provided that guide. towards the I range the variability that And being far believe so, the seeing of really at we end the our in we're –

the on an impact, quarter, have. the seasonality are Obviously, well as and the we in the like really achieve have able utilization So those see visibility just that to that we're rolling off you we those variability vessels. contracts, mentioned, legacy and will related fourth to the

Igor Levi

that the are having But of the off much one proportionately is or two a EBITDA on part vessels impact drop? rolling bigger similar

Ken Neikirk

disproportionately that is I have the to impact QX to both going believe the they historic were on. rates comparison due to larger the

Igor Levi

on then XXXX, you better. said And look could helpful. Very Perfect. the snapshot

that biggest the the Our rates concern or expect one vessel, have the the the of that is next. Brazil year full then lower one beginning second over at we you on to roll end a first and of of year this

enough factors more what And headwind. this strong big talk So I you was than hoping that's be offset a about pretty could to will headwind?

Ken Neikirk

headwind trying are correct. to You position we've for. plan it's for and Potentially, and it's huge been one that a

is We we vessels. that Petrobras to competition. – want the believe know going step is first The to create

as I more UK So, of them. to could on which have to to for leverage, And availability the vessel. some cover ability why clients that alternatives work. previously about need just warrant West mentioned, be it Australia so that as rate get mentioned, vessels, are additional is there Brazil we the strong QX order the we've enough been Africa, asking the the in actually pushing I is than in now the hard into to and And develop markets international

the is retendered that strong big how have the impact generate on and XXXX on depending opportunities vessels, a ability Petrobras. for to rates will our alternative with So,

Igor Levi

it. Got

Scotty Sparks

to add I'll that. just

international large tenders. XX about very large and have plus wells. all out XX there all they're tenders We They're

elsewhere. to look So, there we there is work out if need

Igor Levi

turn back. that Very thank Great, helpful. I'll you.

Operator

Hoh coming is go question the from line of ahead. next ISI]. Our Samantha Please [Evervore

Samantha Hoh

for taking call. Hey thanks guys, my

taking freight. So are like just maybe up in longer-term for customers contract, with on the what costs on higher to multi-terms? about contract step for options time? cost go customers just any wanted the they Curious discussions over And on then said of to Just there visibility guys terms X has of into a contracts might pricing these – given that an if the advantage there the be or other DHS of you kind potentially Brazil. spot for low – if also stay built just potentially escalators opinion

Ken Neikirk

project its – Owen mentioned is. without active which the as competitors, far We the industry. that. competitive future. There Nearer on how analysis. own It is contracts, signs – with warrants tender the each further it the depends has how work – cost term of the and into in we future pretty not in for probably would work would on the cost escalators in be add definitely escalators aggressive any look acceptable to

Samantha Hoh

going to Okay, Robotics. then great. maybe And back

EBITDA segment said or side, of different negative segment still would – I the that year that positive guess, that scenarios could still on of sort what and is is that if part previously the and wondering come year? for EBITDA being the guys the positive for the are two for out to was versus be your I the You guidance

Owen Kratz

positive. EBITDA robotic be the expect fully segment on side, Yes, to we the

the we saw here quarter… what first I think in

Samantha Hoh

meant positive. I sorry, I'm EBIT

Owen Kratz

Okay.

So, year be we yes, last I now would were that year, it EBIT – definitely we I think were expectations positive. think EBIT our are positive. This right

think I on it's positive expectations. it's our still fairly nominal, but

plus of range So, I think the within it's or minus.

but here in third goes, see the in as as second the range. our seasonal we'll quarter the I that expectation think would we activity that positive and be expect far upticks to here be

Samantha Hoh

could terms I to you're little that wanted more bit then in, having of in more a And actually hear Mexico. dialog Gulf increase the one the just of great. if sneak Okay, in

speak remarks customer if Anything you work wondering of to some said And the think you to be I would seen entails type quarter. tendering fourth possibly prepared that for on share in the the great. I your could Gulf was mix? that have increased you and maybe

Scotty Sparks

new We've definitely MG&A definitely the of ask they're for into mixture get seen pricing quarter. that that's abandonment [indiscernible] of in the recently activity We've tender clients The temporary now increase. the believe customers third work and price because of do we're forced or returned. is oil mean, with opportunities. now and activity fourth a some being works We a I of the seen number Yes, to work activity. has and visibility seeing on production of come enhancements P&A

production and So, some coming it's of and to of there's very inquiries a activity, up. P&A contracting but we're mixture enhancements definitely more those getting in close

Samantha Hoh

guys. Thanks Great.

Scotty Sparks

you. Thank

Operator

coming James a question last question Schumm. the from of ahead. follow-up our And Please is line go in queue

James Schumm

on more back willing was not just Hey, you like Droshky sounded letting but guys color in. for said It be to me successful, it the Would as the how any little rate bit sort maybe might recompletion? give a hoped. maybe successful of on you we thanks about or you'd what well think or as net-backs comment you or Can flow just the this? pricing some indication of like be of should give

Owen Kratz

as the cringes. The is can that be. legal I a flow my – give going to know you lot in. But rate detail of platform counsel don't on anyway, is the shut what we

we've out, you or able content. by log not the on two. production so a where well, water of number the was the out have will had we pressure not watered we in We expect, perforated of thought we and end which a the looks on evaluation we partially near coming the run would done the to did the isolated given May. and put was sand, well reservoir it drained production June it – of an two be like the higher and number It's beginning we've the work So, – until

than going sufficient to But profitable positive but there. not we it until – of be of think see recompletion. rates. our that's I how it we're some a sure recoup wait will to So, there will going the It's isolated the have flow just more much. cost be, But oil is quantity oil much be till to more June we're how to

getting out that, idle doing to asset of recompletion, work back doing purpose offset our on the the money the which of just actually it said having to Now, recompletion time. and the served was

have would at savings recompletion, the the the the So, include the does incurred dock asset cost we from idle. economics with that not it

James Schumm

Yes, so, Owen…

Scotty Sparks

host the last in like out that recompletion the the because maintenance platform on. do It's shut I nothing point Sorry, finished annual would We just operator EBIT. night. going to has to with

James Schumm

Understood. you. Got

So, or not, use whether think do that? Owen, payback you be vessel what you like, mean if three – is answer it time you you think would could the –? this what years or you do the utilization I on

Owen Kratz

be start than – flowing on no. months. it be no, much no, will we Oh, that XX faster The within it. rates XX will payout be It The to will will we of the achieve amount when that. actually precise time depend flow

James Schumm

all so Thank right. much, Okay, guys. you Great.

Owen Kratz

of on know that's what based right And estimate yeah, – now. an we course

James Schumm

Understood. Thanks Great. guys.

Operator

no at this And questions we have time. further

Erik Staffeldt

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

Operator

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

Helix Energy Solutions (HLX) 28 Apr 212021 Q1 Earnings call transcript