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Item 1. Financial Statements

2022-08-04 compared with 2022-04-29 · 138 added, 73 removed, 375 unchanged (36% of the section changed)

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Service and other $ 177,254 $ 147,784 $ 336,824 $ 269,780

8 unchanged sentences

Depreciation and amortization expense 23,083 21,377 43,210 42,646

Other operating expense 258 71

Impairment expense — 7,935 — 7,935

Other operating (income) expense ( 106 ) 30 152 101

170,712 152,047 332,153 287,378

1 unchanged sentence

Interest expense ( 2,608 ) ( 3,401 ) ( 5,076 ) ( 6,763 )

Interest income 2 2 2 2

Other income 415 788 2,111 5,702

Income (loss) before income taxes 12,051 ( 482 ) 15,516 ( 8,831 )

Income tax expense ( 1,557 ) ( 1,076 )

Income tax (expense) benefit ( 1,821 ) 492 ( 3,378 ) ( 584 )

Net income (loss) 10,230 10 12,138 ( 9,415 )

Net income attributable to noncontrolling interest 498 59

Net income (loss) attributable to noncontrolling interest 662 ( 3 ) 1,160 56

Net income (loss) attributable to Civeo Corporation 9,568 13 10,978 ( 9,471 )

12 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Net income (loss) $ 10,230 $ 10 $ 12,138 $ ( 9,415 )

Other comprehensive income (loss), net of taxes:

Other comprehensive loss, net of taxes:

Foreign currency translation adjustment, net of zero taxes

( 20,024 ) ( 1,573 ) ( 12,012 ) ( 3,200 )

Total other comprehensive income (loss), net of taxes 8,012 ( 1,627 )

Total other comprehensive loss, net of taxes ( 20,024 ) ( 1,573 ) ( 12,012 ) ( 3,200 )

Comprehensive income (loss) ( 9,794 ) ( 1,563 ) 126 ( 12,615 )

Comprehensive income attributable to noncontrolling interest 538 49

Comprehensive income (loss) attributable to Civeo Corporation $ 9,382 $ ( 11,101 )

Comprehensive income (loss) attributable to noncontrolling interest 568 ( 11 ) 1,106 38

Comprehensive loss attributable to Civeo Corporation $ ( 10,362 ) $ ( 1,552 ) $ ( 980 ) $ ( 12,653 )

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

2 unchanged sentences

(In Thousands, Excluding Share Amounts)

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Current assets:

30 unchanged sentences

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

aggregate liquidation preference of $ 97,925,880 and $ 97,438,687 as of March 31, 2022 and December 31, 2021)

aggregate liquidation preference of $ 98,415,509 and $ 97,438,687 as of June 30, 2022 and December 31, 2021)

62,918 61,941

25 unchanged sentences

Shareholders’

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

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

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

3 unchanged sentences

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

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

Balance, March 31, 2022 $ 62,428 $ — $ 1,583,474 $ ( 912,037 ) $ ( 9,063 ) $ ( 353,911 ) $ 2,080 $ 372,971

Net income (loss) — — — 9,568 — — 662 10,230

Currency translation adjustment — — — — — ( 19,930 ) ( 94 ) ( 20,024 )

Dividends paid — — — — — — ( 66 ) ( 66 )

Dividends attributable to Class A preferred shares 490 — — ( 490 ) — — — —

Common shares repurchased — — — ( 533 ) — — — ( 533 )

Share-based compensation — — 942 — — — — 942

Balance, June 30, 2022 $ 62,918 $ — $ 1,584,416 $ ( 903,492 ) $ ( 9,063 ) $ ( 373,841 ) $ 2,582 $ 363,520

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

Balance, December 31, 2021 $ 61,941 $ — $ 1,582,442 $ ( 912,951 ) $ ( 8,050 ) $ ( 361,883 ) $ 1,612 $ 363,111

Net income — — — 10,978 — — 1,160 12,138

4 unchanged sentences

Share-based compensation — — 1,974 — ( 1,013 ) — 961

Balance, March 31, 2022 $ 62,428 $ — $ 1,583,474 $ ( 912,037 ) $ ( 9,063 ) $ ( 353,911 ) $ 2,080 $ 372,971

Balance, June 30, 2022 $ 62,918 $ — $ 1,584,416 $ ( 903,492 ) $ ( 9,063 ) $ ( 373,841 ) $ 2,582 $ 363,520

Shares Common

2 unchanged sentences

Common shares repurchased — ( 23 )

Balance, March 31, 2022 9,042 14,186

Balance, June 30, 2022 9,042 14,188

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

2 unchanged sentences

(In Thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

2 unchanged sentences

Depreciation and amortization 43,210 42,646

Impairment charges — 7,935

Deferred income tax expense 3,256 416

35 unchanged sentences

We provide hospitality services to the natural resources industry in Canada, Australia and the U.S.

We provide a full suite of hospitality services for our guests, including lodging, catering and food service, housekeeping and maintenance at accommodation facilities that we or our customers own.

In many cases, we provide services that support the day-to-day operations of accommodation facilities, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics.

Our full suite of hospitality services for our guests includes lodging, catering and food service, housekeeping and maintenance at accommodation facilities that we or our customers own.

In many cases, we provide services that support the day-to-day operations, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics.

We also offer development activities for workforce accommodation facilities, including site selection, permitting, engineering and design, manufacturing management and site construction, along with providing hospitality services once the facility is constructed.

18 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Accommodation revenues $ 79,431 $ 69,759 $ 146,625 $ 116,289

12 unchanged sentences

Our payment terms vary by the type and location of our customer and the products or services offered.

The term between invoicing and when our performance obligations are satisfied is not significant.

The time between invoicing and when our performance obligations are satisfied is not significant.

Payment terms are generally within 30 days and in most cases do not extend beyond 60 days.

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

As of March 31, 2022, 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, 2022, 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):

1 unchanged sentence

2022 2023 2024 Thereafter Total

Revenue expected to be recognized as of March 31, 2022 $ 116,850 $ 44,930 $ 13,240 $ 10,943 $ 185,963

Revenue expected to be recognized as of June 30, 2022 $ 75,076 $ 47,206 $ 12,605 $ 9,964 $ 144,851

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

1 unchanged sentence

The table above represents only a portion of our expected future consolidated revenues and it is not necessarily indicative of the expected trend in total revenues.

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.

FAIR VALUE MEASUREMENTS

1 unchanged sentence

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

As of March 31, 2022 and December 31, 2021, 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.

In addition, the estimated fair value of our assets held for sale is based upon Level 2 fair value measurements, which include appraisals and previous negotiations with third parties.

CIVEO CORPORATION

1 unchanged sentence

FINANCIAL STATEMENTS

As of June 30, 2022 and December 31, 2021, 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.

In addition, the estimated fair value of our assets held for sale is based upon Level 2 fair value measurements, which include appraisals and previous negotiations with third parties.

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

Our estimate of the fair value of undeveloped land positions in Australia that were impaired was based on appraisals from third parties.

See Note 3 – Impairment Charges for further information.

DETAILS OF SELECTED BALANCE SHEET ACCOUNTS

Additional information regarding selected balance sheet accounts at March 31, 2022 and December 31, 2021 is presented below (in thousands):

March 31, 2022 December 31, 2021

Additional information regarding selected balance sheet accounts at June 30, 2022 and December 31, 2021 is presented below (in thousands):

June 30, 2022 December 31, 2021

Accounts receivable, net:

5 unchanged sentences

Total accounts receivable, net $ 134,845 $ 114,859

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Finished goods and purchased products $ 5,611 $ 5,346

2 unchanged sentences

Total inventories $ 7,382 $ 6,468

(in years) March 31, 2022 December 31, 2021

(in years) June 30, 2022 December 31, 2021

Property, plant and equipment, net:

9 unchanged sentences

Total property, plant and equipment, net $ 349,094 $ 389,996

March 31, 2022 December 31, 2021

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

June 30, 2022 December 31, 2021

Accrued liabilities:

4 unchanged sentences

ASSETS HELD FOR SALE

As of March 31, 2022 and December 31, 2021, assets held for sale included certain assets in our U.S.

business segment and various undeveloped land holdings in our Australia business segment.

As of June 30, 2022, assets held for sale included certain assets in our U.S.

business segment, an undeveloped land holding and a village in our Australia business segment and an unused corporate office space acquired in the Noralta acquisition in our Canada business segment.

As of December 31, 2021, assets held for sale included certain assets in our U.S.

business segment and undeveloped land holdings in our Australia business segment.

These assets were recorded at the estimated fair value less costs to sell, which exceeded their carry values.

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

The following table summarizes the carrying amount as of March 31, 2022 and December 31, 2021 of the assets classified as held for sale (in thousands):

March 31, 2022 December 31, 2021

The following table summarizes the carrying amount as of June 30, 2022 and December 31, 2021 of the assets classified as held for sale (in thousands):

June 30, 2022 December 31, 2021

Assets held for sale:

4 unchanged sentences

Participating securities are allocated a proportional share of net income determined by dividing total weighted average participating securities by the sum of total weighted average common shares and participating securities.

In calculating diluted earnings per share, we utilize the most dilutive result of the two class method and if-converted methods.

We also apply the treasury stock method with respect to certain share-based awards in the calculation of diluted earnings per share, if dilutive.

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

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,

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

2022 2021 2022 2021

Net income (loss) attributable to Civeo common shareholders $ 9,078 $ ( 467 ) $ 10,001 $ ( 10,429 )

12 unchanged sentences

(1) Computations may reflect rounding adjustments.

For the three months ended March 31, 2022, we excluded 0.1 million share-based awards from the computation of diluted earnings per share because their effect was anti-dilutive.

For the three and six months ended June 30, 2022, we excluded a portion of our share-based awards, which totaled less than 0.1 million shares, 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.

As a result of the net loss for the three months ended March 31, 2021, we excluded from the computation of diluted loss per share 0.2 million share based awards since the effect would have been anti-dilutive.

Additionally, for the three months ended March 31, 2022 and 2021, we excluded from the computation the impact of converting the Preferred Shares into 2.5 million and 2.4 million common shares, respectively, since the effect would have been anti-dilutive.

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

Additionally, for the three and six months ended June 30, 2022 and 2021, the impact of converting the Preferred Shares into 2.5 million and 2.4 million common shares, respectively, using the if-converted method would have been anti-dilutive.

CIVEO CORPORATION

1 unchanged sentence

FINANCIAL STATEMENTS

As of March 31, 2022 and December 31, 2021, long-term debt consisted of the following (in thousands):

March 31, 2022 December 31, 2021

As of June 30, 2022 and December 31, 2021, long-term debt consisted of the following (in thousands):

June 30, 2022 December 31, 2021

Canadian term loan;

weighted average interest rate of 3.9 % for the three month period ended March 31, 2022

weighted average interest rate of 4.1 % for the six month period ended June 30, 2022

$ 46,560 $ 63,104

revolving credit facility;

weighted average interest rate of 5.5 % for the three month period ended March 31, 2022

weighted average interest rate of 5.7 % for the six month period ended June 30, 2022

Canadian revolving credit facility;

weighted average interest rate of 4.1 % for the three month period ended March 31, 2022

weighted average interest rate of 4.4 % for the six month period ended June 30, 2022

93,586 111,300

Australian revolving credit facility;

weighted average interest rate of 3.2 % for the three month period ended March 31, 2022

weighted average interest rate of 3.3 % for the six month period ended June 30, 2022

154,638 175,130

4 unchanged sentences

Credit Agreement

As of March 31, 2022, our Credit Agreement (as then amended to date, the Credit Agreement) provided for:

As of June 30, 2022, our Credit Agreement (as then amended to date, the Credit Agreement) provided for:

(i) a $ 200.0 million revolving credit facility scheduled to mature on September 8, 2025, allocated as follows:

7 unchanged sentences

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 3.00 % to 4.00 %, based on a ratio of our total net debt to Consolidated EBITDA.

The future transitions from LIBOR and CDOR as interest rate benchmarks are addressed in the Credit Agreement and at such time the transition from (i) LIBOR takes place, an alternate benchmark will be established based on the first alternative of the following, plus a benchmark replacement adjustment, Term SOFR, Daily Simple SOFR and an alternative benchmark selected by the administrative agent and the applicable borrowers giving due consideration to any selection or recommendation by a government body or any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S.

The future transitions from LIBOR and CDOR as interest rate benchmarks are addressed in the Credit Agreement and at such time the transition from (i) LIBOR takes place, an alternate benchmark will be established based on the first alternative of the following, plus a benchmark replacement adjustment, Term Secured Overnight Financing Rate (SOFR), Daily Simple SOFR and an alternative benchmark selected by the administrative agent and the applicable borrowers giving due consideration to any selection or recommendation by a government body or any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S.

dollar-denominated syndicated credit facilities at such time or (ii) CDOR takes place, we will endeavor with the administrative agent to establish an alternate rate of interest to CDOR that gives due consideration to any evolving or then existing convention for similar Canadian Dollar denominated syndicated credit facilities for the replacement of CDOR.

7 unchanged sentences

and (vii) investments and other restricted payments, including dividends and other distributions.

In addition, we must maintain a minimum interest coverage ratio, defined as the ratio of Consolidated EBITDA to consolidated interest expense, of at least 3.00 to 1.00 and our maximum net leverage ratio, defined as the ratio of total net debt to Consolidated EBITDA, of no greater than 3.25 to 1.00 for the quarter ended March 31, 2022 and

CIVEO CORPORATION

1 unchanged sentence

FINANCIAL STATEMENTS

3.00 to 1.00 for each quarter thereafter.

the ratio of total net debt to Consolidated EBITDA, of no greater than 3.00 to 1.00.

Following a qualified offering of indebtedness, we will be required to maintain a maximum leverage ratio of no greater than 3.50 to 1.00 and a maximum senior secured ratio less than 2.00 to 1.00.

1 unchanged sentence

EBITDA and consolidated interest, as defined, exclude goodwill and asset impairments, debt discount amortization, amortization of intangibles and other non-cash charges.

We were in compliance with our covenants as of March 31, 2022.

We were in compliance with our covenants as of June 30, 2022.

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, 2022, we had seven lenders that were parties to the Credit Agreement, with total commitments (including both revolving commitments and term commitments) ranging from $ 22.5 million to $ 52.0 million.

As of March 31, 2022, we had outstanding letters of credit of $ 0.3 million under the U.S.

As of June 30, 2022, we had seven lenders that were parties to the Credit Agreement, with total commitments (including both revolving commitments and term commitments) ranging from $ 22.5 million to $ 52.0 million.

As of June 30, 2022, we had outstanding letters of credit of $ 0.3 million under the U.S.

facility, zero under the Australian facility and $ 1.1 million under the Canadian facility.

6 unchanged sentences

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, 2022 and 2021, Canada and the U.S.

As of June 30, 2022 and 2021, 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, 2022 totaled $ 1.6 million, or 44.9 % of pretax income, compared to tax expense of $ 1.1 million, or ( 12.9 )% of pretax loss, for the three months ended March 31, 2021.

Our effective tax rate for both the three months ended March 31, 2022 and 2021 was impacted by considering Canada and the U.S.

Our income tax expense for the three months ended June 30, 2022 totaled $ 1.8 million, or 15.1 % of pretax income, compared to income tax benefit of $ 0.5 million, or 102.1 % of pretax loss, for the three months ended June 30, 2021.

Our effective tax rate for both the three months ended June 30, 2022 and 2021 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, under Accounting Standards Codification 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 six months ended June 30, 2022 totaled $ 3.4 million, or 21.8 % of pretax income, compared to income tax expense of $ 0.6 million, or ( 6.6 )% of pretax loss, for the six months ended June 30, 2021.

Our effective tax rate for the six months ended June 30, 2022 and 2021 was impacted by considering Canada and the U.S.

loss jurisdictions.

COMMITMENTS AND CONTINGENCIES

2 unchanged sentences

ACCUMULATED OTHER COMPREHENSIVE LOSS

Our accumulated other comprehensive loss decreased $ 8.0 million from $ 361.9 million at December 31, 2021 to $ 353.9 million at March 31, 2022, as a result of foreign currency exchange rate fluctuations.

Changes in other comprehensive loss during the first three months of 2022 were primarily driven by the Australian dollar and 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$ 200 million and A$ 251 million, respectively, at March 31, 2022.

Our accumulated other comprehensive loss increased $ 12.0 million from $ 361.9 million at December 31, 2021 to $ 373.8 million at June 30, 2022, as a result of foreign currency exchange rate fluctuations.

Changes in other comprehensive loss during the first six months of 2022 were primarily driven by the Australian dollar and Canadian dollar decreasing in value compared to the U.S.

Excluding intercompany balances, our Canadian dollar and Australian dollar functional currency net assets totaled approximately C$ 238 million and A$ 225 million, respectively, at June 30, 2022.

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

SHARE REPURCHASE PROGRAM

2 unchanged sentences

The repurchase authorization allows repurchases from time to time in open market transactions, including pursuant to trading plans adopted in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934.

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

We intend to fund repurchases through cash on hand and cash generated from operations.

Pursuant to our common share repurchase program, during the three months ended March 31, 2022, we repurchased an aggregate of 500 of our common shares outstanding at a weighted average price of $ 18.47 per share, for a total of approximately $ 9.2 thousand.

Pursuant to our common share repurchase program, during the six months ended June 30, 2022, we repurchased an aggregate of 22,911 of our common shares outstanding at a weighted average price of $ 23.65 per share, for a total of approximately $ 0.5 million.

We have repurchased an aggregate of 240,090 of our common shares outstanding at a weighted average price of $ 21.59 per share for a total cost of $ 5.2 million since inception of the common share repurchase program.

The common shares repurchased under the program are cancelled in the periods they are acquired and the payment is accounted for as an increase to accumulated deficit in our Unaudited Consolidated Statements of Changes in Shareholders’ Equity in the period the payment is made.

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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, 2022 and 2021 totaled $ 0.4 million and $ 0.5 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, 2022 and 2021 was $ 0.6 million and $ 1.5 million, respectively.

At March 31, 2022, unrecognized compensation cost related to restricted share awards, restricted share units and deferred share awards was $ 0.1 million, which is expected to be recognized over a weighted average period of 0.1 years.

On May 18, 2022, we granted 39,032 restricted share awards to our non-employee directors, which vest in their entirety on May 17, 2023.

Compensation expense associated with restricted share awards, restricted share units and deferred share awards recognized in the three months ended June 30, 2022 and 2021 totaled $ 0.3 million and $ 0.3 million, respectively.

Compensation expense associated with restricted share awards, restricted share units and deferred share awards recognized in the six months ended June 30, 2022 and 2021 totaled $ 0.7 million and $ 0.8 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, 2022 and 2021 was $ 1.5 million and zero , 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, 2022 and 2021 was $ 2.1 million and $ 1.5 million, respectively.

At June 30, 2022, unrecognized compensation cost related to restricted share awards, restricted share units and deferred share awards was $ 0.9 million, which is expected to be recognized over a weighted average period of 0.9 years.

Phantom Share Awards.

2 unchanged sentences

Phantom share awards are settled in cash upon vesting.

During the three months ended March 31, 2022 and 2021, we recognized compensation expense associated with phantom shares totaling $ 2.4 million and $ 1.4 million, respectively.

At March 31, 2022, unrecognized compensation cost related to phantom shares was $ 15.3 million, as remeasured at March 31, 2022, which is expected to be recognized over a weighted average period of 2.2 years.

During the three months ended June 30, 2022 and 2021, we recognized compensation expense associated with phantom shares totaling $ 2.5 million and $ 1.4 million, respectively.

During the six months ended June 30, 2022 and 2021, we recognized compensation expense associated with phantom shares totaling $ 4.9 million and $ 2.9 million, respectively.

At June 30, 2022, unrecognized compensation cost related to phantom shares was $ 14.5 million, as remeasured at June 30, 2022, which is expected to be recognized over a weighted average period of 2.0 years.

Performance Awards.

On February 25, 2022, we granted 122,555 performance awards under the Civeo Plan, which cliff vest in three years on February 25, 2025 subject to attainment of applicable performance criteria.

These awards will be earned in amounts between 0 % and 200 % of the participant’s target performance share award, based on (1) the payout percentage associated with Civeo’s relative total shareholder return rank among a peer group that includes 17 other companies and (2) the payout percentage associated with Civeo's cumulative operating cash flow over the performance period relative to a preset target.

These awards will be earned in amounts between 0 % and 200 % of the participant’s target performance share award, based equally on (i) the payout percentage associated with Civeo’s relative total shareholder return rank among a peer group that includes 17 other companies

CIVEO CORPORATION

NOTES TO UNAUDITED CONSOLIDATED

FINANCIAL STATEMENTS

and (ii) the payout percentage associated with Civeo's cumulative operating cash flow over the performance period relative to a preset target.

The portion of the performance awards tied to cumulative operating cash flow includes a performance-based vesting requirement.

1 unchanged sentence

We evaluate the probability of achieving the performance criteria throughout the performance period and will adjust share-based compensation expense based on the number of shares expected to vest based on our estimate of the most probable performance outcome.

The ultimate payout of the cumulative operating cash flow component of the award can vary from 0 % to 100 % based on actual results.

During the three months ended March 31, 2022 and 2021, we recognized compensation expense associated with performance awards totaling $ 0.6 million and $ 0.5 million, respectively.

The total fair value of performance share awards that vested during the three months ended March 31, 2022 and 2021 was $ 2.4 million and $ 1.9 million, respectively.

At March 31, 2022, unrecognized compensation cost related to performance shares was $ 6.4 million, which is expected to be recognized over a weighted average period of 2.5 years.

During the three months ended June 30, 2022 and 2021, we recognized compensation expense associated with performance awards totaling $ 0.7 million and $ 0.6 million, respectively.

During the six months ended June 30, 2022 and 2021, we recognized compensation expense associated with performance awards totaling $ 1.3 million and $ 1.1 million, respectively.

No performance share awards vested during the three months ended June 30, 2022 and 2021.

The total fair value of performance share awards that vested during the six months ended June 30, 2022 and 2021 was $ 2.4 million and $ 1.9 million, respectively.

At June 30, 2022, unrecognized compensation cost related to performance shares was $ 5.2 million, which is expected to be recognized over a weighted average period of 2.2 years.

CIVEO CORPORATION

4 unchanged sentences

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 months ended March 31, 2022 and 2021 is summarized in the following table (in thousands):

Financial information by business segment for each of the three and six months ended June 30, 2022 and 2021 is summarized in the following table (in thousands):

revenues Depreciation

1 unchanged sentence

(loss) Capital

Three months ended March 31, 2022

Three months ended June 30, 2022

Canada $ 109,023 $ 14,998 $ 11,197 $ 1,847 $ 753,303

3 unchanged sentences

Total $ 184,954 $ 23,083 $ 14,242 $ 5,055 $ 637,397

Three months ended March 31, 2021

Three months ended June 30, 2021

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

3 unchanged sentences

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

Six months ended June 30, 2022

Canada $ 204,975 $ 26,595 $ 15,235 $ 3,853 $ 753,303

Australia 131,349 15,685 11,587 4,048 204,086

14,308 777 ( 2,904 ) 724 26,165

Corporate and eliminations — 153 ( 5,439 ) 22 ( 346,157 )

Total $ 350,632 $ 43,210 $ 18,479 $ 8,647 $ 637,397

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

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

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