What changed in this filing

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Item 1. Financial Statements

2021-07-30 compared with 2021-04-30 · 137 added, 84 removed, 421 unchanged (34% of the section changed)

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2021 2020 2021 2020

Service and other $ 147,784 $ 110,006 $ 269,780 $ 239,405

9 unchanged sentences

Impairment expense 7,935 — 7,935 144,120

Other operating expense 71 989

Other operating expense (income) 30 ( 285 ) 101 704

152,047 116,543 287,378 404,404

Operating loss ( 9,901 ) ( 149,069 )

Operating income (loss) 2,129 ( 1,841 ) ( 7,772 ) ( 150,910 )

Interest expense ( 3,401 ) ( 3,854 ) ( 6,763 ) ( 9,449 )

1 unchanged sentence

Other income 788 12,642 5,702 12,667

Loss before income taxes ( 8,349 ) ( 154,623 )

Income tax (expense) benefit ( 1,076 ) 8,811

Net loss ( 9,425 ) ( 145,812 )

(Loss) income before income taxes ( 482 ) 6,951 ( 8,831 ) ( 147,672 )

Income tax benefit (expense) 492 ( 122 ) ( 584 ) 8,689

Net income (loss) 10 6,829 ( 9,415 ) ( 138,983 )

Net income attributable to noncontrolling interest ( 3 ) 222 56 480

Net loss attributable to Civeo Corporation ( 9,484 ) ( 146,070 )

Net income (loss) attributable to Civeo Corporation 13 6,607 ( 9,471 ) ( 139,463 )

Dividends attributable to Class A preferred shares 480 471 958 939

Net loss attributable to Civeo common shareholders $ ( 9,962 ) $ ( 146,538 )

Net (loss) income attributable to Civeo common shareholders $ ( 467 ) $ 6,136 $ ( 10,429 ) $ ( 140,402 )

Per Share Data (see Note 7) (1)

Basic net loss per share attributable to Civeo Corporation common shareholders $ ( 0.70 ) $ ( 10.43 )

Diluted net loss per share attributable to Civeo Corporation common shareholders $ ( 0.70 ) $ ( 10.43 )

Basic net (loss) income per share attributable to Civeo Corporation common shareholders $ ( 0.03 ) $ 0.37 $ ( 0.73 ) $ ( 9.96 )

Diluted net (loss) income per share attributable to Civeo Corporation common shareholders $ ( 0.03 ) $ 0.37 $ ( 0.73 ) $ ( 9.96 )

Weighted average number of common shares outstanding:

8 unchanged sentences

Three Months Ended

Net loss $ ( 9,425 ) $ ( 145,812 )

June 30, Six Months Ended

2021 2020 2021 2020

Net income (loss) $ 10 $ 6,829 $ ( 9,415 ) $ ( 138,983 )

Other comprehensive income (loss), net of taxes:

1 unchanged sentence

( 1,573 ) 29,385 ( 3,200 ) ( 19,156 )

Total other comprehensive loss, net of taxes ( 1,627 ) ( 48,541 )

Comprehensive loss ( 11,052 ) ( 194,353 )

Comprehensive income attributable to noncontrolling interest 49 163

Comprehensive loss att ributable to Civeo Corporation

$ ( 11,101 ) $ ( 194,516 )

Total other comprehensive income (loss), net of taxes ( 1,573 ) 29,385 ( 3,200 ) ( 19,156 )

Comprehensive income (loss) ( 1,563 ) 36,214 ( 12,615 ) ( 158,139 )

Comprehensive (loss) income attributable to noncontrolling interest ( 11 ) 303 38 466

Comprehensive (loss) income attributable to Civeo Corporation $ ( 1,552 ) $ 35,911 $ ( 12,653 ) $ ( 158,605 )

The accompanying notes are an integral part of these financial statements.

2 unchanged sentences

(In Thousands, Excluding Share Amounts)

March 31, 2021 December 31, 2020

June 30, 2021 December 31, 2020

Current assets:

29 unchanged sentences

50,000,000 shares authorized, 9,042 shares issued and outstanding, respectively;

aggregate liquidation preference of $ 95,991,601 and $ 95,514,031 as of March 31, 2021 and December 31, 2020)

aggregate liquidation preference of $ 96,471,559 and $ 95,514,031 as of June 30, 2021 and December 31, 2020)

60,974 60,016

27 unchanged sentences

Shareholders’

Balance, December 31, 2019 $ 58,129 $ — $ 1,572,249 $ ( 771,590 ) $ ( 5,472 ) $ ( 363,173 ) $ 662 $ 490,805

Balance, March 31, 2020 $ 58,597 $ — $ 1,574,457 $ ( 918,128 ) $ ( 6,914 ) $ ( 411,619 ) $ 552 $ 296,945

Net income (loss) — — — 6,607 — — 222 6,829

3 unchanged sentences

Share-based compensation — — 1,331 — ( 16 ) — — 1,315

Balance, June 30, 2020 $ 59,068 $ — $ 1,575,788 $ ( 911,992 ) $ ( 6,930 ) $ ( 382,315 ) $ 624 $ 334,243

Balance, March 31, 2021 $ 60,494 $ — $ 1,579,342 $ ( 917,689 ) $ ( 8,050 ) $ ( 350,606 ) $ 648 $ 364,139

Net income (loss) — — — 13 — — ( 3 ) 10

Currency translation adjustment — — — — — ( 1,565 ) ( 8 ) ( 1,573 )

Dividends paid — — — — — — ( 42 ) ( 42 )

Dividends attributable to Class A preferred shares 480 — — ( 480 ) — — — —

Share-based compensation — — 871 — — — — 871

Balance, June 30, 2021 $ 60,974 $ — $ 1,580,213 $ ( 918,156 ) $ ( 8,050 ) $ ( 352,171 ) $ 595 $ 363,405

Balance, December 31, 2019 $ 58,129 $ — $ 1,572,249 $ ( 771,590 ) $ ( 5,472 ) $ ( 363,173 ) $ 662 $ 490,805

4 unchanged sentences

Share-based compensation — — 3,539 — ( 1,458 ) — — 2,081

Balance, March 31, 2021 $ 60,494 $ — $ 1,579,342 $ ( 917,689 ) $ ( 8,050 ) $ ( 350,606 ) $ 648 $ 364,139

Balance, June 30, 2020 $ 59,068 $ — $ 1,575,788 $ ( 911,992 ) $ ( 6,930 ) $ ( 382,315 ) $ 624 $ 334,243

Balance, December 31, 2020 $ 60,016 $ — $ 1,578,315 $ ( 907,727 ) $ ( 6,930 ) $ ( 348,989 ) $ 672 $ 375,357

Net income (loss) — — — ( 9,471 ) — — 56 ( 9,415 )

Currency translation adjustment — — — — — ( 3,182 ) ( 18 ) ( 3,200 )

Dividends paid — — — — — — ( 115 ) ( 115 )

Dividends attributable to Class A preferred shares 958 — — ( 958 ) — — — —

Share-based compensation — — 1,898 — ( 1,120 ) — — 778

Balance, June 30, 2021 $ 60,974 $ — $ 1,580,213 $ ( 918,156 ) $ ( 8,050 ) $ ( 352,171 ) $ 595 $ 363,405

Shares Common

2 unchanged sentences

Share-based compensation — 101

Balance, March 31, 2021 9,042 14,293

Balance, June 30, 2021 9,042 14,316

(1) Reflects our 1-for-12 reverse share split that became effective November 19, 2020.

4 unchanged sentences

(In Thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

18 unchanged sentences

Proceeds from disposition of property, plant and equipment 7,012 1,897

Net cash flows provided by (used in) investing activities 3,279 ( 2,579 )

Other, net — 4,619

Net cash flows provided by investing activities 482 2,669

Cash flows from financing activities:

60 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2021 2020 2021 2020

Accommodation revenues $ 69,759 $ 40,204 $ 116,289 $ 106,270

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We do not have significant financing components or significant payment terms.

As of March 31, 2021, for contracts that are greater than one year, the table below discloses the estimated revenues related to performance obligations that are unsatisfied (or partially unsatisfied) and when we expect to recognize the revenue.

As of June 30, 2021, for contracts that are greater than one year, the table below discloses the estimated revenues related to performance obligations that are unsatisfied (or partially unsatisfied) and when we expect to recognize the revenue.

The table only includes revenue expected to be recognized from contracts where the quantity of service is certain (in thousands):

4 unchanged sentences

2021 2022 2023 Thereafter Total

Revenue expected to be recognized as of March 31, 2021 $ 85,246 $ 79,365 $ 16,194 $ 1,992 $ 182,797

Revenue expected to be recognized as of June 30, 2021 $ 53,065 $ 81,244 $ 14,253 $ 2,008 $ 150,570

We applied the practical expedient and do not disclose consideration for remaining performance obligations with an original expected duration of one year or less.

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We believe that the carrying values of these instruments on the accompanying consolidated balance sheets approximate their fair values.

As of March 31, 2021 and December 31, 2020, we believe the carrying value of our floating-rate debt outstanding under our term loans and revolving credit facilities approximates fair value because the terms include short-term interest rates and exclude penalties for prepayment.

As of June 30, 2021 and December 31, 2020, we believe the carrying value of our floating-rate debt outstanding under our term loans and revolving credit facilities approximates fair value because the terms include short-term interest rates and exclude penalties for prepayment.

We estimated the fair value of our floating-rate term loan and revolving credit facilities using significant other observable inputs, representative of a Level 2 fair value measurement, including terms and credit spreads for these loans.

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The discount rates used to value our reporting units for the goodwill impairment test ranged between 10.5 % and 14.0 %.

During the first quarter of 2020, we wrote down certain long-lived assets to fair value.

We estimated the fair value when conducting the long-lived asset impairment tests primarily using an income approach.

During the second quarter of 2021 and the first quarter of 2020, we wrote down certain long-lived assets to fair value.

During the first quarter of 2020, we estimated the fair value when conducting the long-lived asset impairment tests primarily using an income approach.

We used a variety of unobservable inputs and underlying assumptions consistent with those discussed above for purposes of our goodwill impairment test.

1 unchanged sentence

segments long-lived asset impairment analysis ranged between 11.0 % and 14.0 %.

During the second quarter of 2021, our estimate of the fair value of undeveloped land positions in Australia that were impaired was based on appraisals from third parties.

See Note 6 – Impairment Charges for further information.

DETAILS OF SELECTED BALANCE SHEET ACCOUNTS

Additional information regarding selected balance sheet accounts at March 31, 2021 and December 31, 2020 is presented below (in thousands):

March 31, 2021 December 31, 2020

Additional information regarding selected balance sheet accounts at June 30, 2021 and December 31, 2020 is presented below (in thousands):

June 30, 2021 December 31, 2020

Accounts receivable, net:

1 unchanged sentence

Unbilled revenue 31,716 22,565

Other 7 1,421

Total accounts receivable 114,567 90,057

4 unchanged sentences

FINANCIAL STATEMENTS

(1) As of March 31, 2021 and December 31, 2020, Other accounts receivable included a $ 1.7 million and $ 1.1 million receivable, respectively, related to the Canada Emergency Wage Subsidy (CEWS), a subsidy implemented by the Canadian government in response to the COVID-19 pandemic.

Other income related to the CEWS during the three months ended March 31, 2021 and 2020 was $ 2.8 million and zero , respectively.

March 31, 2021 December 31, 2020

As of December 31, 2020, Other accounts receivable included $ 1.1 million related to the Canada Emergency Wage Subsidy (CEWS), a subsidy implemented by the Canadian government in response to the COVID-19 pandemic.

For the three months ended June 30, 2021 and 2020, Other income related to the CEWS was $ 0.7 million and $ 6.2 million, respectively.

For the six months ended June 30, 2021 and 2020, Other income related to the CEWS was $ 3.5 million and $ 6.2 million, respectively.

June 30, 2021 December 31, 2020

Finished goods and purchased products $ 5,330 $ 5,047

2 unchanged sentences

Total inventories $ 6,958 $ 6,181

(in years) March 31, 2021 December 31, 2020

(in years) June 30, 2021 December 31, 2020

Property, plant and equipment, net:

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During the first quarter 2021, the manufacturing facility was sold.

March 31, 2021 December 31, 2020

As of June 30, 2021, assets held for sale included $ 2.2 million related to various non-operational land holdings in Australia.

June 30, 2021 December 31, 2020

Accrued liabilities:

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IMPAIRMENT CHARGES

Quarter ended June 30, 2021 .

During the second quarter of 2021, we recorded impairment expense of $ 7.9 million related to various undeveloped land positions and related permitting costs in Australia.

At June 30, 2021, we identified an impairment trigger related to certain of these properties due to the cancellation of a significant thermal coal project in Australia and our negative expectations related to other possible Australian thermal coal projects becoming viable in the near term.

Accordingly, the assets were written down to their estimated fair value of $ 2.4 million.

As of June 30, 2021, we concluded certain of the undeveloped land positions met the criteria to be classified as held for sale.

Quarter ended March 31, 2020 .

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The spread of the COVID-19 coronavirus (COVID-19) and the response thereto during the first quarter of 2020 negatively impacted the global economy.

The resulting unprecedented decline in oil demand, coupled with disagreements between Saudi Arabia and Russia about production limits, resulted in a collapse of global oil prices in March 2020, thereby creating unprecedented downward pressure on stock prices in the energy industry, particularly small-cap companies with operations in the U.S.

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

operations in the U.S.

and Canada, such as Civeo.

3 unchanged sentences

Based on the results of the impairment test, we reduced the value of our goodwill in our Canadian reporting unit to zero and recognized impairment expense in the first quarter of 2020 of $ 93.6 million.

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

Furthermore, as a result of the decline in global oil prices and forecasts for a potentially protracted period of lower prices, as well as the goodwill impairment in our Canadian segment, we determined all asset groups within this segment had experienced a trigger that indicated that the carrying values might not be recoverable.

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The calculation of earnings per share attributable to Civeo common shareholders is presented below for the periods indicated (in thousands, except per share amounts):

Three Months Ended March 31,

Net loss attributable to Civeo common shareholders $ ( 9,962 ) $ ( 146,538 )

Three Months Ended June 30, Six Months Ended June 30,

2021 2020 2021 2020

Net (loss) income attributable to Civeo common shareholders $ ( 467 ) $ 6,136 $ ( 10,429 ) $ ( 140,402 )

income allocated to participating securities — ( 886 ) — —

Basic net loss attributable to Civeo Corporation common shareholders $ ( 9,962 ) $ ( 146,538 )

Basic net income (loss) attributable to Civeo Corporation common shareholders $ ( 467 ) $ 5,250 $ ( 10,429 ) $ ( 140,402 )

undistributed income attributable to participating securities — 886 — —

undistributed income reallocated to participating securities — ( 885 ) — —

Diluted net loss attributable to Civeo Corporation common shareholders $ ( 9,962 ) $ ( 146,538 )

Diluted net income (loss) attributable to Civeo Corporation common shareholders $ ( 467 ) $ 5,251 $ ( 10,429 ) $ ( 140,402 )

Weighted average shares outstanding - basic 14,278 14,151 14,244 14,097

6 unchanged sentences

(1) Computations may reflect rounding adjustments.

For the three months ended March 31, 2021 and 2020, we excluded 0.2 million and 0.5 million share-based awards, respectively, from the computation of diluted earnings per share because their effect was anti-dilutive.

For the three months ended June 30, 2020, we excluded 0.3 million share-based awards from the computation of diluted earnings per share because their effect was anti-dilutive.

When an entity has a net loss from continuing operations, it is prohibited from including potential common shares in the computation of diluted per share amounts.

Additionally, for the three months ended March 31, 2021 and 2020, we excluded from the computation the impact of converting the Preferred Shares into 2.4 million and 2.4 million common shares, respectively, since the effect would have been anti-dilutive.

For the three months ended June 30, 2021 and the six months ended June 30, 2021 and 2020, we excluded from the computation of diluted loss per share 0.1 million, 0.2 million and 0.4 million share-based awards, respectively, since the effect would have been anti-dilutive.

Additionally, for the three and six months ended June 30, 2021 and 2020, we excluded from the computation the impact of converting the Preferred Shares into 2.4 million and 2.4 million common shares, respectively, since the effect would have been anti-dilutive.

CIVEO CORPORATION

1 unchanged sentence

FINANCIAL STATEMENTS

As of March 31, 2021 and December 31, 2020, long-term debt consisted of the following (in thousands):

March 31, 2021 December 31, 2020

As of June 30, 2021 and December 31, 2020, long-term debt consisted of the following (in thousands):

June 30, 2021 December 31, 2020

Canadian term loan, which matures on May 30, 2023;

C$ 11.2 million principal repayable per quarter;

weighted average interest rate of 4.0 % for the three month period ended March 31, 2021

weighted average interest rate of 4.0 % for the six month period ended June 30, 2021

$ 174,636 $ 187,530

revolving credit facility, which matures on May 30, 2023;

weighted average interest rate of 5.8 % for the three month period ended March 31, 2021

weighted average interest rate of 5.8 % for the six month period ended June 30, 2021

Canadian revolving credit facility, which matures on May 30, 2023;

weighted average interest rate of 4.5 % for the three month period ended March 31, 2021

weighted average interest rate of 4.5 % for the six month period ended June 30, 2021

44,697 45,789

Australian revolving credit facility, which matures on May 30, 2023;

weighted average interest rate of 3.6 % for the three month period ended March 31, 2021

16,746 17,767

weighted average interest rate of 3.6 % for the six month period ended June 30, 2021

226,833 251,086

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Credit Agreement

As of March 31, 2021, our Credit Agreement (as then amended to date, the Credit Agreement) provided for:

As of June 30, 2021, our Credit Agreement (as then amended to date, the Credit Agreement) provided for:

(i) a $ 167.3 million revolving credit facility scheduled to mature on May 30, 2023, allocated as follows:

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Australian dollar amounts outstanding under the Credit Agreement bear interest at a variable rate equal to the Bank Bill Swap Bid Rate plus a margin of 3.50 % to 4.50 %, based on a ratio of our total debt to consolidated EBITDA.

The future transitions from LIBOR and CDOR as interest rate benchmarks is addressed in the Credit Agreement and at such time the transition from LIBOR or CDOR takes place, we will endeavor with the administrative agent to establish an alternate rate of interest to LIBOR or CDOR that gives due consideration to (1) the then prevailing market convention for determining a rate of interest for syndicated loans in the United States at such time for the replacement of LIBOR and (2) any evolving or then existing convention for similar Canadian Dollar denominated syndicated credit facilities for the replacement of CDOR.

The future transitions from LIBOR and CDOR as interest rate benchmarks are addressed in the Credit Agreement and at such time the transition from LIBOR or CDOR takes place, we will endeavor with the administrative agent to establish an alternate rate of interest to LIBOR or CDOR that gives due consideration to (1) the then prevailing market convention for determining a rate of interest for syndicated loans in the United States at such time for the replacement of LIBOR and (2) any evolving or then existing convention for similar Canadian Dollar denominated syndicated credit facilities for the replacement of CDOR.

The Credit Agreement contains customary affirmative and negative covenants that, among other things, limit or restrict:

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discount amortization, amortization of intangibles and other non-cash charges.

We were in compliance with our covenants as of March 31, 2021.

We were in compliance with our covenants as of June 30, 2021.

Borrowings under the Credit Agreement are secured by a pledge of substantially all of our assets and the assets of our subsidiaries subject to customary exceptions.

The obligations under the Credit Agreement are guaranteed by our significant subsidiaries.

As of March 31, 2021, we had eight lenders that were parties to the Credit Agreement, with total commitments (including both revolving commitments and term commitments) ranging from $ 22.4 million to $ 71.1 million.

As of March 31, 2021, we had outstanding letters of credit of $ 1.2 million under the U.S.

facility, $ 0.1 million under the Australian facility and $ 2.0 million under the Canadian facility.

As of March 31, 2021 and December 31, 2020, we also had two bank guarantee facilities totaling A$ 3.0 million which mature on May 31, 2021.

We had bank guarantees of A$ 0.9 million and A$ 0.8 million under these facilities outstanding as of March 31, 2021 and December 31, 2020, respectively.

As of June 30, 2021, we had eight lenders that were parties to the Credit Agreement, with total commitments (including both revolving commitments and term commitments) ranging from $ 22.4 million to $ 71.1 million.

As of June 30, 2021, we had outstanding letters of credit of $ 0.9 million under the U.S.

facility, zero under the Australian facility and $ 2.1 million under the Canadian facility.

As of June 30, 2021, we had one bank guarantee facility totaling A$ 1.0 million.

We had bank guarantees of A$ 0.8 million outstanding under the facility as of June 30, 2021 .

Our operations are conducted through various subsidiaries in a number of countries throughout the world.

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Income taxes for any significant and unusual or extraordinary transactions are computed and recorded in the period in which the specific transaction occurs.

As of March 31, 2021 and 2020, Canada and the U.S.

As of June 30, 2021 and 2020, Canada and the U.S.

were considered loss jurisdictions for tax accounting purposes and were removed from the annual effective tax rate computation for purposes of computing the interim tax provision.

Our income tax expense for the three months ended March 31, 2021 totaled $ 1.1 million, or ( 12.9 %) of pretax loss, compared to a tax benefit of $ 8.8 million, or 5.7 % of pretax loss, for the three months ended March 31, 2020.

Our effective tax rate for both the three months ended March 31, 2021 and March 31, 2020 was impacted by considering Canada and the U.S.

Our income tax benefit for the three months ended June 30, 2021 totaled $ 0.5 million, or 102.1 % of pretax loss, compared to tax expense of $ 0.1 million, or 1.8 % of pretax income, for the three months ended June 30, 2020.

Our effective tax rate for both the three months ended June 30, 2021 and June 30, 2020 was impacted by considering Canada and the U.S.

loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision.

Additionally, for the three months ended March 31, 2020, we recorded a deferred tax benefit of $ 12.4 million offset by a valuation allowance of $ 3.4 million against the Canadian net deferred tax assets.

Under ASC 740-270, "Accounting for Income Taxes," the quarterly tax provision is based on our current estimate of the annual effective tax rate less the prior quarter's year-to-date provision.

Our income tax expense for the six months ended June 30, 2021 totaled $ 0.6 million, or ( 6.6 )% of pretax loss, compared to a benefit of $ 8.7 million, or 5.9 % of pretax loss, for the six months ended June 30, 2020.

Our effective tax rate for the six months ended June 30, 2021 and June 30, 2020 was impacted by considering Canada and the U.S.

loss jurisdictions.

Although Australia was not considered a loss jurisdiction for the six months ended June 30, 2020, our effective tax rate was impacted by utilization of deferred tax assets and a release of the corresponding valuation allowance in Australia, resulting in no income tax expense for that jurisdiction.

Additionally, our effective tax rate for the six months ended June 30, 2020 was impacted by a deferred tax benefit of $ 9.6 million offset by an increase of $ 0.7 million in the valuation allowance in Canada.

COMMITMENTS AND CONTINGENCIES

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ACCUMULATED OTHER COMPREHENSIVE LOSS

Our accumulated other comprehensive loss increased $ 1.6 million from $ 349.0 million at December 31, 2020 to $ 350.6 million at March 31, 2021, as a result of foreign currency exchange rate fluctuations.

Changes in other comprehensive loss during the first three months of 2021 were primarily driven by the Australian dollar decreasing in value compared to the U.S.

Our accumulated other comprehensive loss increased $ 3.2 million from $ 349.0 million at December 31, 2020 to $ 352.2 million at June 30, 2021, as a result of foreign currency exchange rate fluctuations.

Changes in other comprehensive loss during the first six months of 2021 were primarily driven by the Australian dollar decreasing in value compared to the U.S.

dollar, partially offset by the Canadian dollar increasing in value compared to the U.S.

Excluding intercompany balances, our Canadian dollar and Australian dollar functional currency net assets totaled approximately C$ 160 million and A$ 285 million, respectively, at March 31, 2021.

SHARE-BASED COMPENSATION

Certain key employees and non-employee directors participate in the Amended and Restated 2014 Equity Participation Plan of Civeo Corporation (the Civeo Plan).

The Civeo Plan authorizes our Board of Directors and the Compensation Committee of our Board of Directors to approve grants of options, awards of restricted shares, performance awards, phantom

Excluding intercompany balances, our Canadian dollar and Australian dollar functional currency net assets totaled approximately C$ 166 million and A$ 280 million, respectively, at June 30, 2021.

CIVEO CORPORATION

1 unchanged sentence

FINANCIAL STATEMENTS

share awards and dividend equivalents, awards of deferred shares, and share payments to our employees and non-employee directors.

SHARE-BASED COMPENSATION

Certain key employees and non-employee directors participate in the Amended and Restated 2014 Equity Participation Plan of Civeo Corporation (the Civeo Plan).

The Civeo Plan authorizes our Board of Directors and the Compensation Committee of our Board of Directors to approve grants of options, awards of restricted shares, performance awards, phantom share awards and dividend equivalents, awards of deferred shares, and share payments to our employees and non-employee directors.

No more than 2.4 million Civeo common shares are authorized to be issued under the Civeo Plan.

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Restricted Share Awards / Restricted Share Units / Deferred Share Awards.

Compensation expense associated with restricted share awards, restricted share units and deferred share awards recognized in the three months ended March 31, 2021 and 2020 totaled $ 0.5 million and $ 1.3 million, respectively.

The total fair value of restricted share awards, restricted share units and deferred share awards that vested during the three months ended March 31, 2021 and 2020 was $ 1.5 million and $ 2.3 million, respectively.

At March 31, 2021, unrecognized compensation cost related to restricted share awards, restricted share units and deferred share awards was $ 0.8 million, which is expected to be recognized over a weighted average period of 0.9 years.

On May 19, 2021, we granted 45,762 restricted share awards to our non-employee directors, which vest in their entirety on May 19, 2022.

Compensation expense associated with restricted share awards, restricted share units and deferred share awards recognized in the three months ended June 30, 2021 and 2020 totaled $ 0.3 million and $ 0.8 million, respectively.

Compensation expense associated with restricted share awards, restricted share units and deferred share awards recognized in the six months ended June 30, 2021 and 2020 totaled $ 0.8 million and $ 2.0 million, respectively.

The total fair value of restricted share awards, restricted share units and deferred share awards that vested during the three months ended June 30, 2021 and 2020 was zero and $ 0.2 million, respectively.

The total fair value of restricted share awards, restricted share units and deferred share awards that vested during the six months ended June 30, 2021 and 2020 was $ 1.5 million and $ 2.6 million, respectively.

At June 30, 2021, unrecognized compensation cost related to restricted share awards, restricted share units and deferred share awards was $ 1.2 million, which is expected to be recognized over a weighted average period of 0.8 years.

Phantom Share Awards.

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We also granted 81,774 phantom share awards under the Canadian Long-Term Incentive Plan, which vest in three equal annual installments beginning on February 22, 2022.

During the three months ended March 31, 2021 and 2020, we recognized compensation expense associated with phantom shares totaling $ 1.4 million and $ 0.3 million, respectively.

At March 31, 2021, unrecognized compensation cost related to phantom shares was $ 9.5 million, as remeasured at March 31, 2021, which is expected to be recognized over a weighted average period of 2.4 years.

During the three months ended June 30, 2021 and 2020, we recognized compensation expense associated with phantom shares totaling $ 1.4 million and $ 0.4 million, respectively.

During the six months ended June 30, 2021 and 2020, we recognized compensation expense associated with phantom shares totaling $ 2.9 million and $ 0.7 million, respectively.

At June 30, 2021, unrecognized compensation cost related to phantom shares was $ 9.6 million, as remeasured at June 30, 2021, which is expected to be recognized over a weighted average period of 2.2 years.

Performance Awards.

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The ultimate payout of the cumulative free cash flow component of the award can vary from 0 % to 60 % based on actual results.

During the three months ended March 31, 2021 and 2020, we recognized compensation expense associated with performance awards totaling $ 0.5 million and $ 0.9 million, respectively.

The total fair value of performance share awards that vested during the three months ended March 31, 2021 and 2020 was $ 1.9 million and $ 1.9 million, respectively.

At March 31, 2021, unrecognized compensation cost related to performance shares was $ 4.5 million, which is expected to be recognized over a weighted average period of 2.4 years.

SEGMENT AND RELATED INFORMATION

In accordance with current accounting standards regarding disclosures about segments of an enterprise and related information, we have identified the following reportable segments:

Canada, Australia and the U.S., which represent our strategic focus on hospitality services and workforce accommodations.

During the three months ended June 30, 2021 and 2020, we recognized compensation expense associated with performance awards totaling $ 0.6 million and $ 0.6 million, respectively.

During the six months ended June 30, 2021 and 2020, we recognized compensation expense associated with performance awards totaling $ 1.1 million and $ 1.5 million, respectively.

The total fair value of performance share awards that vested during the three months ended June 30, 2021 and 2020 was zero .

The total fair value of performance share awards that vested during the six months ended June 30, 2021 and 2020 was $ 1.9 million and $ 1.9 million, respectively.

At June 30, 2021, unrecognized compensation cost related to performance shares was $ 3.9 million, which is expected to be recognized over a weighted average period of 2.2 years.

CIVEO CORPORATION

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FINANCIAL STATEMENTS

Financial information by business segment for each of the three months ended March 31, 2021 and 2020 is summarized in the following table (in thousands):

SEGMENT AND RELATED INFORMATION

In accordance with current accounting standards regarding disclosures about segments of an enterprise and related information, we have identified the following reportable segments:

Canada, Australia and the U.S., which represent our strategic focus on hospitality services and workforce accommodations.

Financial information by business segment for each of the three and six months ended June 30, 2021 and 2020 is summarized in the following table (in thousands):

revenues Depreciation

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(loss) Capital

Three months ended March 31, 2021

Three months ended June 30, 2021

Canada $ 83,281 $ 12,152 $ 7,452 $ 1,143 $ 763,763

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Total $ 154,176 $ 21,377 $ 2,129 $ 3,158 $ 717,687

Three months ended March 31, 2020

Three months ended June 30, 2020

Canada $ 52,986 $ 12,177 $ ( 6,719 ) $ 231 $ 662,926

3 unchanged sentences

Total $ 114,702 $ 22,205 $ ( 1,841 ) $ 1,196 $ 734,583

Six months ended June 30, 2021

Canada $ 145,166 $ 24,239 $ ( 207 ) $ 2,323 $ 763,763

Australia 123,656 16,971 651 2,701 242,730

United States 10,784 1,108 ( 3,707 ) 851 27,793

Corporate and eliminations — 328 ( 4,509 ) 655 ( 316,599 )

Total $ 279,606 $ 42,646 $ ( 7,772 ) $ 6,530 $ 717,687

Six months ended June 30, 2020

Canada $ 132,334 $ 26,546 $ ( 143,350 ) $ 841 $ 662,926

Australia 106,184 19,028 14,355 1,211 261,188

United States 14,976 1,778 ( 16,757 ) 1,384 30,503

Corporate and eliminations — 355 ( 5,158 ) 411 ( 220,034 )

Total $ 253,494 $ 47,707 $ ( 150,910 ) $ 3,847 $ 734,583

Cautionary Statement Regarding Forward-Looking Statements

14 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements