Civeo Corporation

Greetings. Welcome to the Civio Corporation's second quarter 2022 earnings call. At this time, all participants are in listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note the conference is being recorded. At this time, I'll now turn the conference over to Reagan Nielsen, Director of Corporate Development and Investor Relations. Reagan, you may now begin.

Thank you, and welcome to CIVIO's second quarter 2022 earnings conference call. Today, our call will be led by Bradley Dawson, CIVIO's President and Chief Executive Officer, and Carolyn Stone, CIVIO's Senior Vice President, Chief Financial Officer, and Treasurer. Before we begin, we'd like to caution listeners regarding forward-looking statements. To the extent that our remarks today contain anything other than historical information, please note that we're relying on the safe harbor protections afforded by federal law. Any such remarks should be read in the context of the many factors that affect our business, including risks and uncertainties disclosed in our forms 10-K, 10-Q, and other SEC filings. I'll now turn the call over to Bradley.

Thank you, Reagan, and thank you all for joining us today on our second quarter earnings call. I'll start with key takeaways for the second quarter and then give a brief summary of our second quarter of 2022 performance. after which Carolyn will provide a financial and segment-level review, and I'll conclude with our updated full-year 2022 guidance and the regional assumptions that underlie that guidance. Then we'll open up the call for questions. The key takeaways from our call today are we had a strong second quarter with year-over-year revenues up 20% and adjusted EBITDA 15%, primarily driven by an increase in Canadian lodge build rooms and increased Canadian mobile camp activity, as well as an increase in Australian village build rooms. Second quarter performance coupled with improving customer demand drove our upward revision to our full year guidance. We continue to be encouraged by customer conversations and increasing customer activity and robust pipeline construction work, particularly in Canada. and expect increased maintenance and turnaround spending for the remainder of the year. As a result, we are raising the upper end of our full year 2022 adjusted EBITDA guidance, which I will detail later in the call. Our announcement earlier this month of a 12-year contract renewal for Waposuke Creek Lodge for a long-term partner that our services are necessary to support continued demand in Canadian oil sands regions for many years to come. This morning, we're pleased to announce a five-year integrated services contract with a new customer in South Australia with expected revenues of 120 million Australian. This contract is a testament to the growth and diversification potential of our integrated services business as it encompasses a new customer, a new state in Australia, and a new commodity. From a capital perspective, we continue to deleverage our balance sheet in the second quarter with debt repayments of $18 million, positioning CBO to be opportunistic going forward regarding capital allocation. The contract renewals and awards granted in the second quarter are consistent with our strategy of collaborating with long-term partners to maximize value in the current operating environment in a mutually beneficial way. Overall, we're pleased with our second quarter results compared to our expectations. Although we were encouraged by the current operating environment, we remain committed to capital discipline. We're going to take a brief moment to provide a business update on the three segments. In Canada, our revenues of adjusted EBITDA were slightly above our expectations, increased year over year, driven by a recovery in lodge build rooms and increased Canadian mobile camp activity. We also experienced a significant sequential increase in adjusted EBITDA due to an uptick in activity in the central oil sands area as a result of seasonal turnaround activity, as well as a rebound from a slower start to the year and improved weather conditions, which lowered operating costs. For Australia, our revenues and adjusted EBITDA were in line with our expectations, increasing year over year and relatively flat sequentially. This was driven by increased year-over-year and sequential occupancy at our Capabella Village due to recovering demand with sequential improvement offset by a weakening Australian dollar relative to the U.S. dollar. Turning briefly to the U.S., revenues increased year-over-year due to increased drilling activity positively impacting our well site services business, partially offset by the sale of our West Permian launch, which we did in the fourth quarter of 2021. Adjusted EBITDA decreased slightly year over year, primarily due to the sale of West Permian Lodge, largely offset by increased drilling activity, which, again, impacted the well-safed services business. With that, I'll turn it over to Carolyn.