Yahoo Finance Helix Energy Solutions Group Inc (HLX) (Q1 2024) Earnings Call Transcript Highlights: Key ...
Revenue: $296 million for Q1 2024.
Gross Profit: $20 million for Q1 2024, up from $15 million in Q1 2023.
Net Loss: $26 million for Q1 2024, primarily due to pretax losses from extinguishing convertible notes.
Adjusted EBITDA: $47 million for Q1 2024.
Operating Cash Flow: $64 million for Q1 2024.
Free Cash Flow: $61 million for Q1 2024.
Cash and Cash Equivalents: $324 million as of Q1 2024.
Total Liquidity: $419 million as of Q1 2024.
Funded Debt: $328 million as of Q1 2024.
Net Debt: Negative $6 million as of Q1 2024.
Release Date: April 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you clarify the expectations for the shallow water business EBITDA this year, given the revised revenue projections? A: Owen Kratz, CEO of Helix Energy Solutions, confirmed that the initial guidance of $30 million to $40 million EBITDA remains valid, and he expects to exceed that figure this year.
Q: Why is the shallow-water business considered seasonal compared to deepwater operations in the Gulf of Mexico? A: Owen Kratz explained that the seasonality is due to weather patterns affecting shallow waters, where diving facilities and lift boats are more susceptible to harsh weather conditions, unlike in deeper waters where there is more flexibility with vessel operations.
Q: Are you observing an increase in leading-edge rates for Well Intervention globally, and specifically in the Gulf of Mexico? A: Yes, Owen Kratz noted that leading-edge rates are being pushed up by approximately 15% compared to last year, driven by tight rig rates and increased demand for multiyear commitments from producers.
Q: Regarding the Cox bankruptcy, where does Helix stand in terms of securing contracts for the wells being returned to operators? A: Owen Kratz mentioned that the process varies by operator. Some are well-prepared and discussions for contracts might start soon, potentially seeing some work by late this year, but most of the work will likely begin in 2025.
Q: How is Helix planning to manage its significant cash reserves in relation to shareholder returns and potential investments? A: Owen Kratz stated that the priority is to deploy cash for growth in areas that are immediately accretive to shareholder value. The company plans to continue share repurchases as a secondary option if suitable growth opportunities are not available.
Q: What are the prospects and strategies for the Well Intervention business, considering the current market dynamics and asset availability? A: Owen Kratz highlighted that new asset construction is not viable under current conditions, and the focus will be on exploring options for existing assets in tight markets. He also mentioned potential opportunities in the wind farm market and shallow-water abandonment services.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
