Tidewater Inc. Q3 FY2025 earnings call

• Third quarter revenue and gross margin exceeded expectations; revenue at $341.1M due to higher day rate and better utilization. • Generated $83M free cash flow in third quarter, with first 9 months totaling nearly $275M. • Retain $500M share repurchase authorization, no repurchases in past quarter due to competing priorities. • Offshore vessel market has near-term headwinds but long-term positive outlook; non-drilling demand (production support, FPSO deployment, EPCI) supports business. • Tight vessel supply remains tailwind, structural growth in non-drilling markets strains vessel supply.

Third quarter revenue was $341.1 million, with gross margin at 48%, exceeding expectations. Revenue was driven by higher average day rate and better utilization. Production support comprises roughly 50% of the business. EPCI and Offshore Construction segment backlog began converting into meaningful demand increase. First 9 months of 2025 total free cash flow was nearly $275 million.

• 2025 full year revenue guidance narrowed to $1.33 billion to $1.35 billion, gross margin range 49% to 50%. • 2026 full year revenue range $1.32 billion to $1.37 billion, gross margin range 48% to 50%. • 2026 revenue guidance assumes utilization of approximately 80%, with 11% capacity available for charter if market tightens quicker. • Firm backlog and options for 2026 represent $925 million, ~69% of midpoint revenue guidance, ~57% of available days captured.

• Bigger risk to backlog revenue is unanticipated downtime due to unplanned maintenance and incremental time spent on drydocks.

Q: Jim Rollyson asked about market shaping up for 2026 and capital allocation.

A: Quintin Kneen said expected to get back to drilling activity sooner due to increasing activity in FPSOs and EPCI, and vessel attrition. Also mentioned material nonpublic information on M&A during the quarter.

Q: Fredrik Stene inquired about regional discrepancies in 2026 guidance and Venezuela case.

A: Piers Middleton said Africa and Asia have more exposure in second half of 2026; Quintin Kneen said Venezuela case has been ongoing 12 years, close to settlement but timing hard to call.

Q: Joshua Jayne asked about customer confidence and contract duration.

A: Quintin Kneen and Piers Middleton said customers have better sense of playbook now, contracts signed are where market is today to cover into second half of 2026.

Q: Greg Lewis asked about M&A opportunities and asset preferences.

A: Quintin Kneen said South America more interesting than North America, preference for large PSVs, medium and large anchor handlers; West Gotcher talked about quarterly revenue cadence and operational wherewithal for 2026.