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    CVEO
    Earnings call· Jun 2026(Q2 FY26)

    Civeo Q2 FY26 earnings call CVEO

    Jul 30, 2026 Source

    Executive summary

    Civeo Q2 FY26 — Strong North American Opportunity Set and Financial Flexibility

    Civeo delivered Q2 FY26 results in line with expectations, highlighting a robust North American opportunity pipeline and enhanced financial flexibility from a recent convertible debt offering. While Australia faced temporary macro-driven headwinds, the company remains optimistic about improved conditions in 2027, and its Canadian business shows improving diversification. Management is focused on operational readiness and capital discipline to capitalize on future growth.

    Highlights

    4

    • North American bid pipeline remains robust with over $1.5 billion in total contract value.

    • Completed convertible debt offering provides financial flexibility and lowers cost of capital.

    • Australia remains a strength, with metallurgical coal prices over $220/ton supporting healthy mine economics.

    • Repurchased $36.7 million worth of shares year-to-date, exceeding 2026 intentions.

    Concerns

    3

    • Australia experienced near-term softness due to cost inflation and customer caution from fuel costs and availability amid Middle East trade dislocation.

    • Adjusted EBITDA decreased $1.2 million year-over-year, primarily due to start-up costs for a new Ontario contract and transitory cost inflation in Australia.

    • Start-up costs for the new integrated services contract in Ontario impacted Canadian adjusted EBITDA.

    Guidance & targets

    5
    CategoryTargetConfidence
    Full-year 2026 Revenue
    $675 million to $700 million
    high materiality
    High
    Full-year 2026 Adjusted EBITDA
    $85 million to $90 million
    high materiality
    High
    Full-year 2026 Capital Expenditure
    $25 million to $30 million
    medium materiality
    High
    Australia Integrated Services Annual Revenue Run Rate
    AUD 500 million
    medium materiality
    High
    Canada H2 2026 Revenue Growth
    approximately 20%
    medium materiality
    Medium

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Australia
    Revenue increase driven by stronger Australian dollar, increased integrated services activity, and contributions from acquired buildings, largely offset by softer owned village occupancy. Adjusted EBITDA was $22.6 million compared to $22.3 million in Q2 2025. Average daily rate of $85 compared to $76 in the prior year period.
    Owned village billings: 675,000Average daily rate: $85
    		$125.4 million11%—$22.6 million
    Canada
    Revenue was $54.6 million compared to $50 million in Q2 2025, driven by higher occupancy and a new integrated services contract in Ontario. Adjusted EBITDA was $6 million compared to $6.9 million in Q2 2025, primarily due to start-up costs for the new contract. Average daily rate of $96 compared to $94 in the prior year period.
    Billed rooms: 458,000Average daily rate: $96
    		$54.6 million——$6 million

    Operational metrics

    11
    Adjusted EBITDA
    $23.8 milliondown $1.2 million YoY
    Q2 FY26

    Compared to $25 million in Q2 FY25, primarily due to start-up costs for new Ontario contract and transitory cost inflation in Australia.

    Total Liquidity
    $82 million
    as of June 30, 2026

    Total liquidity as of quarter end.

    Net Debt
    $191 milliondown $8 million from March 31, 2026
    as of June 30, 2026

    Decrease of approximately $8 million from March 31, 2026.

    Net Leverage Ratio
    2.1x
    as of June 30, 2026

    Calculated as of quarter end.

    Shares Repurchased
    $22.3 million660,297 shares
    July 2026 (post-quarter)

    Concurrent with convertible notes offering, completing April 2025 authorization and partially fulfilling subsequent 10% authorization.

    Shares Repurchased YTD
    $36.7 million
    YTD FY26

    Exceeds 2026 intentions for shareholder returns.

    Convertible Senior Notes Principal
    $115 million
    due 2031

    Issued in July 2026, used to fund share repurchase and repay revolver borrowings.

    Share Dilution Threshold (Convertible Notes)
    approximately $53 per share or higher
    future

    Transaction not expected to result in net share dilution unless share price reaches this level.

    Mobile Camp Rooms Available
    2,700
    current

    Strategically located and available for deployment.

    Oil Sands Lodge Rooms Available
    7,000-8,000
    current

    Could be redeployed for the right project.

    Consolidated Revenue Increase YoY
    $17.3 million
    Q2 FY26

    Year-over-year increase in consolidated revenues, primarily driven by foreign exchange and Australian revenue increases.

    Industry KPIs

    1
    MetricValueDetails
    Recycling commodity impact$220+USD/ton

    Orderbook & backlog

    1
    North American Bid Pipeline$1.5 billionQ2 FY26

    in line with last quarter

    Total contract value, dependent on customer and final investment decisions.

    Risks & headwinds

    4
    Cost inflation and customer caution in AustraliaThrough end of year

    Near-term softness from cost inflation and customer caution

    Mitigation: Optimistic about improved conditions in 2027 and beyond.

    Fuel cost and availability amid Middle East seaborne trade dislocationOngoing, persist through end of year

    Principally to the fuel cost and availability

    Mitigation: Expect these temporary macro-driven headwinds to persist through the end of the year, but optimistic for 2027.

    Start-up costs for new integrated services contract in OntarioTemporary

    Decreased adjusted EBITDA by $1.2 million YoY

    Mitigation: Expect to be temporary.

    Timing of customer final investment decisions (FIDs) for North American opportunitiesNear-term

    Meaningful financial contributions for Civeo remains largely outside of our control.

    Mitigation: Taking steps to ensure Civeo is prepared to respond when they do; recently completed convert gives flexibility to move quickly.

    What to watch in Q3 FY26

    4

    North American Contract Awards

    by year-end
    CurrentRobust bid pipeline of $1.5 billion
    TargetMeaningful contracts awarded

    Why it matters

    Signals conversion of pipeline into committed work and future revenue growth.

    I would expect that based on the current opportunity set that something meaningful should be reach FID and we should be in a position to be awarded contracts by year-end.

    Q&A highlights

    5

    Clarification on the best use cases for the 2,700 mobile rooms versus the 7,000-8,000 lodge rooms, and their adaptability.

    Mobile rooms are suited for quick deployment, 250-1,000 person camps, and 2-4 year projects. Lodge rooms are better for larger headcounts (>1,000) and longer-term projects where land availability is limited, justifying installation costs. Proximity to Alberta/BC makes them competitive for Northern US, Canada, and Alaska.

    “The mobile camp rooms are very well suited for 2- to 4-year projects. Below 2 years, it becomes -- the cost of transportation installation and then dismantle and trans out becomes a bigger cost to the total accommodations budget.”

    asked by Stephen Gengaro · answered by Bradley Dodson

    2 min read5 chapters

    Detailed Narrative

    01

    North American Growth Opportunities

    Civeo maintains a robust bid pipeline of over $1.5 billion in total contract value for North America, encompassing LNG, Canadian infrastructure, power, and data center-related projects. The company is preparing its assets and operating platform to execute on these opportunities, which are dependent on customer final investment decisions, with expectations for meaningful contract awards by year-end. While data center interest has softened slightly, the overall opportunity set remains extremely meaningful.

    02

    Financial Flexibility and Capital Allocation

    The company completed a convertible debt offering in July 2026, raising $115 million in lower-cost fixed-rate capital and enhancing financial flexibility. This move allowed for a concurrent share repurchase of 660,297 common shares for $22.3 million, completing the April 2025 authorization and partially fulfilling a subsequent 10% authorization. Civeo's framework is to return at least 75% of annual free cash flow to shareholders, having already repurchased $36.7 million year-to-date.

    03

    Australian Market Dynamics

    Australia's business remains strong with metallurgical coal prices above $220/ton, supporting healthy mine economics. However, the segment experienced near-term softness📎 due to elevated fuel costs and diesel availability concerns, leading to customer caution and transitory📎 cost pressures. Management expects these macro-driven headwinds to persist through year-end but anticipates improved conditions in 2027 and beyond, with owned village occupancy remaining solid.

    04

    Canadian Business Performance

    Canadian Q2 results were as expected, with revenue growth driven by higher occupancy and a new integrated services contract in Ontario. Adjusted EBITDA decreased due to temporary start-up costs for this new contract. The company expects approximately 20% year-over-year revenue growth in H2 2026 for Canada, supported by base business execution, integrated services pursuits, and shifted turnaround activity.

    05

    Asset Readiness and Strategic Positioning

    Civeo possesses 2,700 mobile camp rooms and 7,000-8,000 oil sands lodge rooms available for deployment, strategically located for projects in the Northern United States, Canada, and Alaska. The mobile rooms are well-suited for 2-4 year projects, while lodge rooms are better for larger, longer-term projects. The company emphasizes its operational readiness, capital discipline, and balance sheet flexibility to tailor solutions for customer projects.

    AI-generated summary of the company’s earnings call. Not investment advice.