Oceaneering International, Inc. (NYSE: OII) announced a net income of $41.2 million, or $0.40 per share, on revenues of $680 million for Q3 ending on September 30, 2024. The adjusted net income, factoring in various tax adjustments and foreign exchange impacts, was $37.2 million, or $0.36 per share.
Key highlights for the third quarter include:
- Net income of $41.2 million and adjusted EBITDA of $98.1 million.
- Consolidated operating income reached $71.3 million.
- Cash flow from operations amounted to $91.9 million, with free cash flow at $67 million. The company’s cash reserves stood at $452 million at the quarter’s end.
- The company repurchased 422,229 shares for about $10 million.
Operational highlights as of September 30, 2024:
- The Remotely Operated Vehicles (ROV) fleet had 250 units with 69% utilization and an average revenue per day of $10,576.
- Manufactured Products segment had a backlog of $671 million.
Updated guidance for the full year 2024 and 2025:
- Oceaneering revised its 2024 consolidated adjusted EBITDA forecast to a range of $340 million to $350 million.
- For 2025, the company expects consolidated EBITDA between $400 million and $430 million, with free cash flow surpassing 2024 levels.
Oceaneering’s President and CEO, Roderick A. Larson, emphasized the company’s improved year-over-year performance, with operating income up 23% and revenue rising 7% compared to Q3 2023. He noted significant growth in Subsea Robotics (SSR) and Manufactured Products, along with the company’s first share repurchase since 2015.
Larson added that the midpoint of the updated 2024 EBITDA guidance ($345 million) represents a 19% increase over 2023, while the 2025 EBITDA forecast, at a midpoint of $415 million, reflects a 20% increase year-over-year.
Third Quarter 2024 Segment Performance Compared to Q3 2023:
- Subsea Robotics (SSR): Operating income was $65.7 million, up 37%. EBITDA margin increased to 36%, compared to 31% in the same period last year.
- ROV: Revenue per day rose 13% to $10,576, while fleet utilization remained steady at 69%. The fleet was used 66% for drill support and 34% for vessel-based activities, a shift from 61% and 39% last year.
- Manufactured Products: Operating income increased by 37%, with a 17% revenue growth. The backlog rose to $671 million, up by $115 million year-over-year, and the book-to-bill ratio was 1.21.
- Offshore Projects Group (OPG): Operating income fell by 24% on a 2% revenue decrease due to international market challenges, vessel repair costs, and downtime.
- Integrity Management and Digital Solutions (IMDS): Despite an 11% revenue increase, operating income declined due to a one-time, non-cash charge related to the sale of the Maritime Intelligence division.
- Aerospace and Defense Technologies (ADTech): Revenue remained flat, while operating income dropped 14% due to higher project proposal costs and a change in project mix.
- Corporate Level: Unallocated expenses of $38.9 million aligned with guidance and were lower than the prior year.
Fourth Quarter 2024 Guidance:
- Overall, Q4 2024 revenue is expected to slightly increase from Q3 2024, while adjusted EBITDA should remain stable. Segment-specific expectations include:
- SSR: A slight decrease in revenue and profitability due to seasonality.
- Manufactured Products: Higher revenue but significantly lower profitability.
- OPG: Increased revenue and much higher profitability.
- IMDS: Improved profitability on lower revenue.
- ADTech: Lower revenue and profitability.
- Unallocated expenses are projected to be around $40 million.