Oceaneering on track with full-year 2024 expectations

Texas-headquartered Oceaneering International has reported an operating income of $44.2 million for its Subsea Robotics division in the first three months of 2024, a 31% increase compared to the first quarter of 2023.

In Q1 2024, Oceaneering reported a net income of $15.1 million on revenue of $599 million, while adjusted net income was $13.9 million, reflecting the positive impact of $2.2 million in foreign exchange gains, and the associated $0.8 million of tax effects, along with $0.2 million of expenses related to discrete tax adjustments.

The remotely operated vehicle (ROV) fleet count was 250 in Q1 2024 and the average ROV revenue per day on hire of $10,009 was 9% higher, utilization improved to 64%, and days on hire increased 2% to 14,536. ROV fleet use during the quarter was 66% in drill support and 34% in vessel-based activity, compared to 65% and 35% respectively in Q1 2023.

Manufactured Products operating income improved 17% on a 15% increase in revenue compared to the first quarter of 2023, while operating income margin remained flat at 10%. The backlog was $597 million on March 31 this year, an increase of $151 million compared to the backlog on the same date in 2023.

The operating income in Offshore Projects Group (OPG) declined as expected due to drydock expenses incurred during Q1 2024, on an increase in revenue compared to the first quarter of 2023, Oceaneering said.

“We are encouraged by our first quarter 2024 results. Our adjusted EBITDA was higher than guided, on better-than-expected activity levels across our businesses,” said Roderick A. Larson, President and Chief Executive Officer of Oceaneering.

“Compared to the same quarter last year, our consolidated first quarter 2024 operating income was 37% higher on a 12% increase in revenue, with higher revenue in all of our business segments and improved operating income in each segment except for our Offshore Projects Group (OPG). These results, when combined with our backlog and current levels of bidding activity, support our unchanged guidance for the year.”

For the second quarter of 2024, as compared to the first quarter, OPG activity levels and operating profitability are expected to be significantly higher and Subsea Robotics and Manufactured Products activity levels and operating profitability are expected to be higher.

On a consolidated basis, Oceaneering expects second-quarter operating results to improve, with EBITDA in the range of $80 million to $90 million on a mid-teens percentage increase in revenue.

For the full year of 2024, the U.S. company expects net income to be in the range of $125 million to $155 million, consolidated EBITDA in the range of $330 million to $380 million, free cash flow generation in the range of $110 million to $150 million, and capital expenditures between $110 million to $130 million.