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Revenue: $1.35 billion for 2024, a 33% increase from 2023.
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Net Income: $180.7 million in 2024, nearly doubling from $97.2 million in 2023.
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Adjusted EBITDA: $559.6 million for 2024, up from $386.7 million in 2023.
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Free Cash Flow: $331 million in 2024, tripling from the previous year.
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Net Debt Reduction: Lowered by $149 million in 2024.
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Share Repurchase: $91 million worth of shares repurchased in 2024.
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Gross Margin: 48.2% for 2024, up nearly 4 percentage points year-over-year.
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Average Day Rates: Increased by nearly $4,500 per day in 2024.
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2025 Revenue Guidance: Expected between $1.32 billion and $1.38 billion.
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2025 Gross Margin Guidance: Projected between 48% and 50%.
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Capital Expenditures: $27.6 million in 2024, with an expected increase to $37 million in 2025.
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Debt Payments: $100 million in principal payments on senior secured term loan in 2024.
Release Date: February 28, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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Tidewater Inc (NYSE:TDW) achieved a significant financial improvement in 2024, with revenue growing by 33.3% year-over-year.
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The company successfully increased its average day rates by nearly $4,500 per day, contributing to a nearly doubled net income.
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Adjusted EBITDA grew by nearly 50%, and free cash flow tripled, showcasing strong financial performance.
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Tidewater Inc (NYSE:TDW) actively returned capital to shareholders, repurchasing $91 million of shares in the open market during 2024.
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The company reduced its net debt by $149 million and added $51 million of cash to the balance sheet, ending the year with $310 million of net debt.
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The growth in offshore drilling activity is expected to be more muted throughout 2025, with fewer offshore rigs anticipated compared to 2024.
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There is a deceleration in drilling demand, impacting the company’s ability to push day rates to their highest possible level.
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Tidewater Inc (NYSE:TDW) faces challenges in deal dynamics due to recent market volatility and shifting sentiment.
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The company experienced pressure on leading-edge day rates across vessel classes during the fourth quarter, particularly in the UK region.
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There is a risk of unanticipated downtime due to unplanned maintenance and incremental time spent on dry docks, which could affect revenue.
Q: How has the recent market pause affected Tidewater’s long-term outlook on vessel demand and newbuilds? A: Quintin Kneen, President and CEO, stated that the long-term outlook remains unchanged despite the recent pause. He emphasized that demand for hydrocarbons is strong, and vessel supply is limited, which will likely lead to increased demand and rates in the coming years.
Q: How confident is Tidewater in its 2025 guidance given the softer start to the year? A: Quintin Kneen expressed confidence in the 2025 guidance, noting that about 81% of revenue is covered by backlog. He acknowledged lessons learned from 2024 and emphasized that conversations for contracts in the latter part of 2025 have already begun.
Q: Can you provide insights into the regional distribution of contract renewals and utilization for 2025? A: West Gotcher, Senior Vice President, explained that the Americas have lighter backlog coverage compared to Africa and Asia. He noted that the near-term has more coverage, with more open contracting needed in the latter part of 2025.
Q: What is the status of the drydock schedule for 2025, and are there any delays from 2024? A: Samuel Rubio, CFO, mentioned that while there are some carryovers from 2024, the drydock days are expected to affect utilization by about 5% in 2025. He noted that engine overhauls are higher in 2025 compared to 2024.
Q: How is Tidewater approaching capital allocation and share repurchases in the long term? A: Quintin Kneen highlighted the focus on establishing a long-term capital structure and maintaining financial stability. He indicated that the actions taken in 2024 serve as a guide for future capital allocation, emphasizing the importance of not putting the company under financial distress.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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