Civeo Corp 10-Q

ITEM 1. Financial Statements CIVEO CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands, Except Per Share Amounts) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Revenue $ 162,694 $ 188,713 $ 306,738 $ 354,833 Costs and expenses: Service and other costs 121,531 140,834 236,146 271,279 Selling, general and administrative expenses 20,470 17,433 38,655 36,073 Depreciation and amortization expense 17,827 17,059 34,080 33,829 Impairment expense — — — 7,823 (Gain) loss on sale of McClelland Lake Lodge assets, net 87 — ( 5,988 ) Other operating expense 66 188 573 486 159,894 175,601 309,454 343,502 Operating income (loss) 2,800 13,112 ( 2,716 ) 11,331 Interest expense ( 2,699 ) ( 2,203 ) ( 4,318 ) ( 4,563 ) Interest income 75 54 101 97 Other income 119 310 466 763 Income (loss) before income taxes 295 11,273 ( 6,467 ) 7,628 Income tax expense ( 3,606 ) ( 3,786 ) ( 6,694 ) ( 5,337 ) Net income (loss) ( 3,311 ) 7,487 ( 13,161 ) 2,291 Less: Net income (loss) attributable to noncontrolling interest 3 ( 740 ) ( 5 ) ( 803 ) Net income (loss) attributable to Civeo Corporation $ ( 3,314 ) $ 8,227 $ ( 13,156 ) $ 3,094 Per Share Data (see Note 7) Basic net income (loss) per share attributable to Civeo Corporation common shareholders $ ( 0.25 ) $ 0.57 $ ( 0.98 ) $ 0.21 Diluted net income (loss) per share attributable to Civeo Corporation common shareholders $ ( 0.25 ) $ 0.56 $ ( 0.98 ) $ 0.21 Weighted average number of common shares outstanding: Basic 13,177 14,518 13,387 14,586 Diluted 13,177 14,600 13,387 14,678 Dividends per common share $ 0.00 $ 0.25 $ 0.25 $ 0.50 The accompanying notes are an integral part of these financial statements. 4 CIVEO CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (In Thousands) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Net income (loss) $ ( 3,311 ) $ 7,487 $ ( 13,161 ) $ 2,291 Other comprehensive income (loss), net of taxes: Foreign currency translation adjustment, net of zero taxes 10,935 1,621 12,028 ( 8,610 ) Total other comprehensive income (loss), net of taxes 10,935 1,621 12,028 ( 8,610 ) Comprehensive income (loss) 7,624 9,108 ( 1,133 ) ( 6,319 ) Less: Comprehensive income (loss) attributable to noncontrolling interest 4 ( 767 ) ( 4 ) ( 899 ) Comprehensive income (loss) attributable to Civeo Corporation $ 7,620 $ 9,875 $ ( 1,129 ) $ ( 5,420 ) The accompanying notes are an integral part of these financial statements. 5 CIVEO CORPORATION CONSOLIDATED BALANCE SHEETS (In Thousands, Excluding Share Amounts) June 30, 2025 December 31, 2024 (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 14,638 $ 5,204 Accounts receivable, net 104,491 89,038 Inventories 5,822 7,537 Prepaid expenses 12,954 7,464 Other current assets 1,304 1,210 Total current assets 139,209 110,453 Property, plant and equipment, net 265,138 204,897 Goodwill 7,411 7,001 Other intangible assets, net 73,441 66,502 Operating lease right-of-use assets 14,575 9,401 Other noncurrent assets 9,065 6,818 Total assets $ 508,839 $ 405,072 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable $ 44,702 $ 39,971 Accrued liabilities 39,403 34,933 Income taxes payable 82 10,853 Deferred revenue 2,838 2,501 Other current liabilities 5,213 4,388 Total current liabilities 92,238 92,646 Long-term debt 168,672 43,299 Deferred income taxes 5,813 3,558 Operating lease liabilities 11,066 6,655 Other noncurrent liabilities 21,612 21,916 Total liabilities 299,401 168,074 Shareholders’ Equity: Common shares ( no par value; 46,000,000 shares authorized, 13,134,259 shares and 14,067,721 shares issued, respectively, and 12,696,264 shares and 13,653,647 shares outstanding, respectively) — — Additional paid-in capital 1,633,022 1,631,823 Accumulated deficit ( 1,020,236 ) ( 980,720 ) Common shares held in treasury at cost, 437,995 and 414,074 shares, respectively ( 10,775 ) ( 10,130 ) Accumulated other comprehensive loss ( 392,573 ) ( 404,600 ) Total Civeo Corporation shareholders’ equity 209,438 236,373 Noncontrolling interest — 625 Total shareholders’ equity 209,438 236,998 Total liabilities and shareholders’ equity $ 508,839 $ 405,072 The accompanying notes are an integral part of these financial statements. 6 CIVEO CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (In Thousands) Attributable to Civeo Common Shares Par Value Additional Paid-in Capital Accumulated Deficit Treasury Shares Accumulated Other Comprehensive Income (Loss) Noncontrolling Interest Total Shareholders’ Equity Balance, March 31, 2024 $ — $ 1,629,521 $ ( 931,135 ) $ ( 10,130 ) $ ( 390,877 ) $ 2,731 $ 300,110 Net income (loss) — — 8,227 — — ( 740 ) 7,487 Currency translation adjustment — — — — 1,648 ( 27 ) 1,621 Dividends paid — — ( 3,661 ) — — ( 1 ) ( 3,662 ) Common shares repurchased — — ( 6,644 ) — — — ( 6,644 ) Excise tax on common shares repurchased — — ( 133 ) — — — ( 133 ) Share-based compensation — 609 — — — — 609 Balance, June 30, 2024 $ — $ 1,630,130 $ ( 933,346 ) $ ( 10,130 ) $ ( 389,229 ) $ 1,963 $ 299,388 Balance, March 31, 2025 $ — $ 1,632,420 $ ( 997,400 ) $ ( 10,775 ) $ ( 403,507 ) $ — $ 220,738 Net income (loss) — — ( 3,314 ) — — 3 ( 3,311 ) Currency translation adjustment — — — — 10,934 1 10,935 Dividends paid — — — — — ( 4 ) ( 4 ) Common shares repurchased — — ( 19,140 ) — — — ( 19,140 ) Excise tax on common shares repurchased — — ( 382 ) — — — ( 382 ) Share-based compensation — 602 — — — — 602 Balance, June 30, 2025 $ — $ 1,633,022 $ ( 1,020,236 ) $ ( 10,775 ) $ ( 392,573 ) $ — $ 209,438 Balance, December 31, 2023 $ — $ 1,628,972 $ ( 919,023 ) $ ( 9,063 ) $ ( 380,715 ) $ 2,867 $ 323,038 Net income (loss) — — 3,094 — — ( 803 ) 2,291 Currency translation adjustment — — — — ( 8,514 ) ( 96 ) ( 8,610 ) Dividends paid — — ( 7,368 ) — — ( 5 ) ( 7,373 ) Common shares repurchased — — ( 9,852 ) — — — ( 9,852 ) Excise tax on common shares repurchased — — ( 197 ) — — — ( 197 ) Share-based compensation — 1,158 — ( 1,067 ) — — 91 Balance, June 30, 2024 $ — $ 1,630,130 $ ( 933,346 ) $ ( 10,130 ) $ ( 389,229 ) $ 1,963 $ 299,388 Balance, December 31, 2024 $ — $ 1,631,823 $ ( 980,720 ) $ ( 10,130 ) $ ( 404,600 ) $ 625 $ 236,998 Net loss — — ( 13,156 ) — — ( 5 ) ( 13,161 ) Currency translation adjustment — — — — 12,027 1 12,028 Dividends paid — — ( 3,437 ) — — ( 621 ) ( 4,058 ) Common shares repurchased — — ( 22,474 ) — — — ( 22,474 ) Excise tax on common shares repurchased — — ( 449 ) — — — ( 449 ) Share-based compensation — 1,199 — ( 645 ) — — 554 Balance, June 30, 2025 $ — $ 1,633,022 $ ( 1,020,236 ) $ ( 10,775 ) $ ( 392,573 ) $ — $ 209,438 Common Shares (in thousands) Balance, December 31, 2024 13,654 Share-based compensation 78 Common shares repurchased ( 1,036 ) Balance, June 30, 2025 12,696 The accompanying notes are an integral part of these financial statements. 7 CIVEO CORPORATION UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands) Six Months Ended June 30, 2025 2024 Cash flows from operating activities: Net income (loss) $ ( 13,161 ) $ 2,291 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 34,080 33,829 Impairment charges — 7,823 Deferred income tax benefit ( 1,868 ) ( 4,344 ) Non-cash compensation charge 1,199 1,158 Gains on disposals of assets ( 261 ) ( 6,104 ) Provision (benefit) for credit losses, net of recoveries ( 9 ) 34 Other, net 581 1,257 Changes in operating assets and liabilities: Accounts receivable ( 10,313 ) 15,229 Inventories 2,049 ( 1,525 ) Accounts payable and accrued liabilities ( 1,718 ) ( 17,166 ) Taxes payable ( 13,089 ) 5,836 Other current and noncurrent assets and liabilities, net ( 8,248 ) 25 Net cash flows provided by (used in) operating activities ( 10,758 ) 38,343 Cash flows from investing activities: Capital expenditures ( 9,769 ) ( 10,929 ) Payments related to acquisitions ( 64,948 ) — Proceeds from dispositions of property, plant and equipment 273 10,617 Other, net — 183 Net cash flows used in investing activities ( 74,444 ) ( 129 ) Cash flows from financing activities: Revolving credit borrowings 232,902 120,816 Revolving credit repayments ( 113,679 ) ( 136,641 ) Debt issuance costs ( 423 ) — Dividends paid ( 3,437 ) ( 7,368 ) Repurchases of common shares ( 22,474 ) ( 9,852 ) Taxes paid on vested shares ( 645 ) ( 1,067 ) Net cash flows provided by (used in) financing activities 92,244 ( 34,112 ) Effect of exchange rate changes on cash 2,392 10 Net change in cash and cash equivalents 9,434 4,112 Cash and cash equivalents, beginning of period 5,204 3,323 Cash and cash equivalents, end of period $ 14,638 $ 7,435 The accompanying notes are an integral part of these financial statements. 8 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of the Business We provide hospitality services to remote workforces in Australia and Canada, including catering and food service, lodging, housekeeping and maintenance at accommodation facilities that we or our customers own. We provide services that support the day-to-day operations of these facilities, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics. We also manage development activities for workforce accommodation facilities, including site selection, permitting, engineering and design and manufacturing and site construction management, along with providing hospitality services once the facility is constructed. We primarily operate in some of the world’s most active metallurgical (met) coal, oil, liquefied natural gas (LNG) and iron ore producing regions, and our customers include mining companies, major and independent oil companies, engineering companies and oilfield and mining service companies. We operate in two principal reportable business segments – Australia and Canada. Basis of Presentation Unless otherwise stated or the context otherwise indicates: (i) all references in these consolidated financial statements to “Civeo,” “us,” “our” or “we” refer to Civeo Corporation and its consolidated subsidiaries; and (ii) all references in this report to “dollars” or “$” are to United States (U.S.) dollars. Certain reclassifications have been made to the prior year financial statements for them to conform with the 2025 presentation. The accompanying unaudited consolidated financial statements of Civeo have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC) pertaining to interim financial information. Certain information in footnote disclosures normally included in financial statements prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP) has been condensed or omitted pursuant to those rules and regulations. The unaudited consolidated financial statements included in this report reflect all the adjustments, consisting of normal recurring adjustments, which Civeo considers necessary for a fair presentation of the results of operations for the interim periods covered and for the financial condition of Civeo at the date of the interim balance sheet. Results for the interim periods are not necessarily indicative of results for the full year. The preparation of consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions by management in determining the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. If the underlying estimates and assumptions upon which the financial statements are based change in future periods, actual amounts may differ from those included in the accompanying consolidated financial statements. The unaudited consolidated financial statements included in this report should be read in conjunction with our audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2024. 9 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) 2. REVENUE The following table disaggregates our revenue by our two reportable segments (Australia and Canada) into major categories for the periods indicated (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Australia Accommodation revenues $ 52,682 $ 48,914 $ 99,505 $ 96,021 Food service and other services revenues 59,990 59,694 116,813 104,324 Total Australia revenues 112,672 108,608 216,318 200,345 Canada Accommodation revenues $ 42,590 $ 72,259 $ 76,026 $ 132,046 Mobile facility rental revenues 434 356 653 1,350 Food service and other services revenues 6,998 6,912 13,741 13,291 Total Canada revenues 50,022 79,527 90,420 146,687 Other Other revenues $ — $ 578 $ — $ 7,801 Total other revenues — 578 — 7,801 Total revenues $ 162,694 $ 188,713 $ 306,738 $ 354,833 Our payment terms vary by the type and location of our customer and the services offered. 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 June 30, 2025, 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): For the years ending December 31, 2025 2026 2027 Thereafter Total Revenue expected to be recognized as of June 30, 2025 $ 107,593 $ 178,520 $ 141,889 $ 282,781 $ 710,783 We applied the practical expedient and do not disclose consideration for remaining performance obligations with an original expected duration of one year or less. In addition, we do not estimate revenues expected to be recognized related to unsatisfied performance obligations for contracts without minimum room commitments. 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. 3. IMPAIRMENT CHARGES No impairment expense was recorded during the first or second quarters of 2025. The following summarizes pre-tax impairment charges recorded during 2024, which are included in Impairment expense in our consolidated statements of operations (in thousands): Australia U.S. Total Quarter ended March 31, 2024 Long-lived assets $ 5,749 $ 2,074 $ 7,823 Total $ 5,749 $ 2,074 $ 7,823 10 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) Quarter ended March 31, 2024 . During the first quarter of 2024, we recorded impairment expense of $ 5.7 million related to various undeveloped land positions and related permitting costs in Australia. At March 31, 2024, we identified an impairment trigger related to certain of these properties due to the denial of development permit applications in Australia. Accordingly, the assets were written down to their estimated fair value of $ 0.6 million. In addition, during the first quarter of 2024, we recorded impairment expense of $ 2.1 million, related to land located in the U.S. The land was written down to its estimated fair value (less costs to sell) of $ 3.8 million. 4. FAIR VALUE MEASUREMENTS Our financial instruments consist of cash and cash equivalents, receivables, payables and debt instruments. We believe that the carrying values of these instruments on the accompanying consolidated balance sheets approximate their fair values. As of June 30, 2025 and December 31, 2024, we believe the carrying value of our floating-rate debt outstanding under our 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 revolving credit facilities using significant other observable inputs, representative of a Level 2 fair value measurement, including terms and credit spreads for these loans. During the second quarter of 2025, we acquired accommodation assets, land and customer contracts and recorded them at fair value. Determining the fair value of assets acquired and liabilities assumed required the exercise of judgment, which included the use of a multi-period excess earnings income approach to determine the fair value of the customer relationships. Specifically, the fair value of the customer relationships was determined by calculating the present value of expected cash flows by applying a discount rate that represents the estimated rate that market participants would require for such intangible assets. The expected cash flows and related discount rate are significant unobservable inputs categorized within Level 3 of the fair value hierarchy. The cash flows employed in the valuation are based on our best estimates of future sales, earnings and cash flows after considering factors such as general market conditions, expected future customer orders, contracts with suppliers, labor costs, changes in working capital, long-term business plans and recent operating performance. During the first quarter of 2024, 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. 5. DETAILS OF SELECTED BALANCE SHEET ACCOUNTS Additional information regarding selected balance sheet accounts at June 30, 2025 and December 31, 2024 is presented below (in thousands): June 30, 2025 December 31, 2024 Accounts receivable, net: Trade $ 84,144 $ 72,819 Unbilled revenue 17,313 12,883 Other 3,244 3,544 Total accounts receivable 104,701 89,246 Allowance for credit losses ( 210 ) ( 208 ) Total accounts receivable, net $ 104,491 $ 89,038 June 30, 2025 December 31, 2024 Inventories: Finished goods, including purchased food, housekeeping and retail inventory $ 4,240 $ 6,134 Raw materials 1,582 1,403 Total inventories $ 5,822 $ 7,537 11 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) Estimated Useful Life (in years) June 30, 2025 December 31, 2024 Property, plant and equipment, net: Land $ 29,131 $ 24,052 Accommodations assets 3 — 15 1,411,160 1,272,515 Buildings and leasehold improvements 7 — 20 13,759 12,386 Machinery and equipment 4 — 7 14,711 13,624 Office furniture and equipment 3 — 7 64,699 65,830 Vehicles 3 — 5 8,332 8,775 Construction in progress 2,716 6,835 Total property, plant and equipment 1,544,508 1,404,017 Accumulated depreciation ( 1,279,370 ) ( 1,199,120 ) Total property, plant and equipment, net $ 265,138 $ 204,897 June 30, 2025 December 31, 2024 Accrued liabilities: Accrued compensation $ 25,728 $ 29,209 Accrued taxes, other than income taxes 4,135 3,327 Other 9,540 2,397 Total accrued liabilities $ 39,403 $ 34,933 June 30, 2025 December 31, 2024 Contract liabilities (Deferred revenue): Current contract liabilities (1) $ 2,838 $ 2,501 Noncurrent contract liabilities (1) 4,138 5,098 Total contract liabilities (Deferred revenue) $ 6,976 $ 7,599 (1) Current contract liabilities and Noncurrent contract liabilities are included in "Deferred revenue" and "Other noncurrent liabilities," respectively, in our unaudited consolidated balance sheets. Deferred revenue typically consists of upfront payments received before we satisfy the associated performance obligation. The decrease in deferred revenue from December 31, 2024 to June 30, 2025 was due to revenue recognized over the contracted terms related to advance payments received from a customer for village enhancements in Australia . 12 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) 6. ASSET ACQUISITION On May 6, 2025, we acquired the assets of Qantac Pty Ltd (Qantac), located in Queensland, Australia (the Qantac Acquisition) for total consideration of A$ 105 million (or approximately US$ 68 million) in cash. The Qantac Acquisition included four villages, with 1,340 rooms in Australia’s Bowen Basin and the associated accommodation assets, land and customer contracts. As a result of the Qantac Acquisition, we expanded our existing accommodations business into the Blackwater region of the Bowen Basin, which was not previously served by our existing villages. The Qantac Acquisition was funded with cash on hand and borrowings under the Amended Credit Agreement (as defined in Note 8). Qantac’s operations are reported as new village locations in our Australia reportable business segment. The Qantac Acquisition was accounted for as an asset acquisition based on the principles described in ASC 805, which provides a screen to determine when a set of transferred assets is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similarly identifiable assets, the set of transferred assets is not a business. Under the accounting for asset acquisitions, the acquisition is recorded using a cost accumulation and allocation model under which the cost of such acquisition is allocated on a relative fair value basis to the assets acquired and liabilities assumed. Acquisition-related transaction costs are capitalized as a component of the cost of the assets acquired. Goodwill is not recognized in an asset acquisition, and any difference between consideration transferred and the fair value of the net assets acquired is allocated to the certain identifiable assets acquired based on their relative fair values. The purchase price was allocated to the net assets as follows (in thousands): Consideration: Cash $ 68,189 Direct transaction costs 4,601 Total costs of the asset acquisition $ 72,790 Other current assets $ 184 Property, plant and equipment 70,575 Intangible assets 5,999 Total assets acquired 76,758 Accounts payable and accrued liabilities 67 Deferred income taxes 3,901 Total liabilities assumed 3,968 Net assets acquired $ 72,790 7. EARNINGS PER SHARE We calculate our basic earnings per share by dividing net income (loss) attributable to Civeo Corporation by the weighted average number of common shares outstanding. For diluted earnings per share, the basic shares outstanding are adjusted by adding all potentially dilutive securities. 13 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) The calculation of basic and diluted earnings per share attributable to Civeo common shareholders is presented below for the periods indicated (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Numerator: Basic net income (loss) attributable to Civeo Corporation $ ( 3,314 ) $ 8,227 $ ( 13,156 ) $ 3,094 Diluted net income (loss) attributable to Civeo Corporation $ ( 3,314 ) $ 8,227 $ ( 13,156 ) $ 3,094 Denominator: Weighted average shares outstanding - basic 13,177 14,518 13,387 14,586 Dilutive shares - share-based awards — 82 — 92 Weighted average shares outstanding - diluted 13,177 14,600 13,387 14,678 Basic net income (loss) per share attributable to Civeo Corporation common shareholders (1) $ ( 0.25 ) $ 0.57 $ ( 0.98 ) $ 0.21 Diluted net income (loss) per share attributable to Civeo Corporation common shareholders (1) $ ( 0.25 ) $ 0.56 $ ( 0.98 ) $ 0.21 (1) Computations may reflect rounding adjustments. Share-based awards that have been excluded from the calculation of weighted-average common shares outstanding because the effect is anti-dilutive totaled 0.1 million shares and zero shares, respectively, for the three months ended June 30, 2025 and 2024. Share-based awards that have been excluded from the calculation of weighted-average common shares outstanding because the effect is anti-dilutive totaled 0.1 million shares and fewer than 0.1 million shares, respectively, for the six months ended June 30, 2025 and 2024. 13 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) 8. DEBT As of June 30, 2025 and December 31, 2024, long-term debt consisted of the following (in thousands): June 30, 2025 December 31, 2024 U.S. revolving credit facility; weighted average interest rate of 9.0 % for the six month period ended June 30, 2025 $ — $ — Canadian revolving credit facility; weighted average interest rate of 5.9 % for the six month period ended June 30, 2025 119,480 43,299 Australian revolving credit facility; weighted average interest rate of 6.6 % for the six month period ended June 30, 2025 49,192 — Total debt $ 168,672 $ 43,299 Credit Agreement On March 24, 2025, we amended our Syndicated Facility Agreement (as amended to date, the Amended Credit Agreement), to increase the Australian revolving commitments by $ 20.0 million to an aggregate amount of $ 55.0 million. As of June 30, 2025, the Amended Credit Agreement provided for a $ 265.0 million revolving credit facility scheduled to mature on August 8, 2028, allocated as follows: (A) a $ 10.0 million senior secured revolving credit facility in favor of certain of our U.S. subsidiaries, as borrowers (the U.S. Facility); (B) a $ 200.0 million senior secured revolving credit facility in favor of Civeo and certain of our U.S. subsidiaries, as borrowers (the Canadian Facility); and (C) a $ 55.0 million senior secured revolving credit facility in favor of one of our Australian subsidiaries, as borrower. U.S. dollar amounts outstanding under the facilities provided by the Amended Credit Agreement bear interest at a variable rate equal to Adjusted Term Secured Overnight Financing Rate (SOFR), which is equal to Term SOFR plus a 10 basis point adjustment, plus a margin of 2.50 % to 3.75 %, or a base rate plus a margin of 1.50 % to 2.75 %, in each case based on a ratio of our total net debt to Consolidated EBITDA (as defined in the Amended Credit Agreement). Canadian dollar amounts outstanding bear interest at a variable rate equal to Adjusted Term Canadian Overnight Repo Rate Average (CORRA), which is equal to the Term CORRA plus a 29.547 basis point adjustment for one month terms or a 32.138 basis point adjustment for three month terms, plus a margin of 2.50 % to 3.75 %, or a Canadian Prime rate plus a margin of 1.50 % to 2.75 %, in each case based on a ratio of our total net debt to Consolidated EBITDA (as defined in the Amended Credit Agreement). Australian dollar amounts outstanding under the Amended Credit Agreement bear interest at a variable rate equal to the Bank Bill Swap Bid Rate plus a margin of 2.50 % to 3.75 %, based on a ratio of our total net debt to Consolidated EBITDA (as defined in the Amended Credit Agreement). The Amended Credit Agreement contains customary affirmative and negative covenants that, among other things, limit or restrict: (i) indebtedness, liens and fundamental changes; (ii) asset sales; (iii) specified acquisitions; (iv) certain restrictive agreements; (v) transactions with affiliates; and (vi) 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 a maximum net leverage ratio, defined as 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 no greater than 2.00 to 1.00. Each of the factors considered in the calculations of these ratios are defined in the Amended Credit Agreement. 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 June 30, 2025. Borrowings under the Amended 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 Amended Credit Agreement are guaranteed by our significant subsidiaries. As of June 30, 2025, we had six lenders that were parties to the Amended Credit Agreement, with total revolving commitments ranging from $ 35.0 million to $ 60.0 million. As of June 30, 2025, we had outstanding letters of credit of zero under the U.S. facility, zero under the Australian facility and $ 0.9 million under the Canadian facility. We also had outstanding bank guarantees of A$ 1.5 million under the Australian facility. 14 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) 9. INCOME TAXES Our operations are conducted through various subsidiaries in a number of countries throughout the world. We have provided for income taxes based upon the tax laws and rates in the countries in which operations are conducted and income is earned. We operate in three jurisdictions, Australia, Canada and the U.S., where statutory tax rates range from 15 % to 30 %. Our effective tax rate will vary from period to period based on changes in earnings mix between these different jurisdictions. On January 1, 2024, the Organization for Economic Cooperation and Development Pillar Two rules became effective and established a minimum 15% tax rate on certain multinational enterprises. The Pillar Two rules have been implemented in Australia and Canada, with the U.S. still uncertain to date. The applicable tax law changes with respect to Pillar Two were considered for the jurisdictions in which we operate, and the rules did not have a materially adverse impact on our financial results. We compute our quarterly taxes under the effective tax rate method by applying an anticipated annual effective rate to our year-to-date income, except for significant unusual or extraordinary transactions. 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 June 30, 2025 and 2024, 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 June 30, 2025 totaled $ 3.6 million, or 1222.4 % of pretax income, compared to income tax expense of $ 3.8 million, or 33.6 % of pretax income, for the three months ended June 30, 2024. Our effective tax rate for the three months ended June 30, 2025 and 2024 was impacted by Canada and the U.S. being considered loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision. Our income tax expense for the six months ended June 30, 2025 totaled $ 6.7 million, or ( 103.5 )% of pretax loss, compared to income tax expense of $ 5.3 million, or 70.0 % of pretax income, for the six months ended June 30, 2024. Our effective tax rate for the six months ended June 30, 2025 and 2024 was impacted by Canada and the U.S. being considered loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision. 10. COMMITMENTS AND CONTINGENCIES We are a party to various pending or threatened claims, lawsuits and administrative proceedings seeking damages or other remedies concerning our commercial operations, products, employees and other matters, including warranty and product liability claims as a result of our products or operations. Although we can give no assurance about the outcome of pending legal and administrative proceedings and the effect such outcomes may have on us, management believes that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided for or covered by insurance, will not have a material adverse effect on our consolidated financial position, results of operations or liquidity. 11. ACCUMULATED OTHER COMPREHENSIVE LOSS Our accumulated other comprehensive loss decreased $ 12.0 million from $ 404.6 million at December 31, 2024 to $ 392.6 million at June 30, 2025, as a result of foreign currency exchange rate fluctuations. Changes in other comprehensive loss during the six months of 2025 were primarily driven by the Australian dollar and Canadian dollar increasing in value compared to the U.S. dollar. Excluding intercompany balances, our Canadian dollar and Australian dollar functional currency net assets totaled approximately C$ 74 million and A$ 234 million, respectively, at June 30, 2025. 15 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) 12. SHARE REPURCHASE PROGRAMS AND DIVIDENDS Share Repurchase Programs In September 2024, our Board of Directors (Board) authorized a common share repurchase program (the Share Repurchase Program) to repurchase of up to 5.0 % of our total common shares which were issued and outstanding at that date, or approximately 0.7 million common shares over a twelve month period. In March 2025, our Board authorized an increase to the Share Repurchase Program to repurchase up to 10.0 % of our total common shares which are issued and outstanding at that date, or approximately 1.4 million common shares, and in April 2025, our Board authorized a further increase to repurchase up to 20.0 % of our total common shares which are issued and outstanding at that date, or approximately 2.7 million common shares. The repurchase authorization allows repurchases from time to time through a variety of methods, including but not limited to open market repurchases, pursuant to a Rule 10b5-1 compliant plan, or privately negotiated transactions. We have funded, and intend to continue to fund, repurchases through cash on hand, cash from debt incurrences and cash generated from operations. Any common shares repurchased 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. The following table summarizes our common share repurchases for the periods presented (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Dollar-value of shares repurchased $ 19,140 $ 6,644 $ 22,474 $ 9,852 Shares repurchased 883.3 274.1 1,036.4 407.2 Average price paid per share $ 21.64 $ 24.21 $ 21.65 $ 24.17 Dividends Our Board declared the following quarterly dividends for the six months ended June 30, 2025 and 2024. The dividends are eligible dividends pursuant to the Income Tax Act (Canada). In April 2025, we announced the suspension by our Board of quarterly dividends on our common shares to prioritize returning capital to our shareholders through ongoing share repurchases. Date Declared Record Date Payment Date Per Share Amount January 31, 2025 February 24, 2025 March 17, 2025 $ 0.25 April 26, 2024 May 27, 2024 June 17, 2024 $ 0.25 February 2, 2024 February 26, 2024 March 18, 2024 $ 0.25 13. 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 and the Compensation Committee of our Board to approve and grant awards of options, awards of restricted shares, performance share awards, phantom share units and dividend equivalents, awards of deferred shares, and share payments to our employees and non-employee directors. Approximately 3.0 million Civeo common shares are authorized to be issued under the Civeo Plan. Outstanding Awards Phantom Share Units. On March 3, 2025, we granted 171,723 phantom share units under the Civeo Plan, which vest in three equal annual installments beginning on March 3, 2026. We also granted 57,432 phantom share units under the Canadian Long-Term Incentive Plan, which vest in three equal annual installments beginning on March 3, 2026. Phantom share units are settled in cash upon vesting. 16 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) During the three months ended June 30, 2025 and 2024, we recognized compensation expense associated with phantom share units totaling $ 1.5 million and $ 1.6 million, respectively. During the six months ended June 30, 2025 and 2024, we recognized compensation expense associated with phantom share units totaling $ 3.3 million and $ 2.9 million, respectively. At June 30, 2025, unrecognized compensation cost related to phantom share units was $ 9.3 million, as remeasured at June 30, 2025, which is expected to be recognized over a weighted average period of 2.1 years. Performance Share Awards. On March 3, 2025, we granted 189,124 performance share awards under the Civeo Plan, which cliff vest after three years 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 the payout percentage associated with Civeo’s relative total shareholder return rank among a peer group of other companies and the payout percentage associated with Civeo's three-year growth in EBITDA over the performance period relative to a preset 2027 EBITDA target. The portion of the performance share awards tied to the 2027 EBITDA target includes a performance-based vesting requirement. 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. No share-based compensation expense is recognized if the performance criteria are not probable of being achieved. During the three months ended June 30, 2025 and 2024, we recognized compensation expense associated with performance share awards totaling $ 0.3 million and $ 0.3 million, respectively. During the six months ended June 30, 2025 and 2024, we recognized compensation expense associated with performance share awards totaling $ 0.7 million and $ 0.6 million, respectively. No performance share awards vested during the three months ended June 30, 2025 and 2024. The total fair value of performance share awards that vested during the six months ended June 30, 2025 and 2024 was $ 1.7 million and $ 2.8 million, respectively. At June 30, 2025, unrecognized compensation cost related to performance share awards was $ 2.2 million, which is expected to be recognized over a weighted average period of 1.9 years. Restricted Share Awards / Restricted Share Units / Deferred Share Awards. On May 14, 2025, we granted 50,215 restricted share and deferred share awards to our non-employee directors, which vest in their entirety in May 2026. Compensation expense associated with restricted share awards, restricted share units and deferred share awards recognized in the three months ended June 30, 2025 and 2024 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, 2025 and 2024 totaled $ 0.5 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 and six months ended June 30, 2025 and 2024 was $ 0.9 million and $ 1.2 million, respectively. At June 30, 2025, 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. 17 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) 14. SEGMENT AND RELATED INFORMATION We report segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments. Our Chief Executive Officer is the chief operation decision maker. We have identified two reportable segments, Australia and Canada, which represent our strategic focus on hospitality services and workforce accommodations. Prior to the fourth quarter of 2024, we presented segment operating income (loss) to include an allocation of corporate overhead expenses. To better align segment operating income (loss) to the profitability measure used by our chief operating decision maker, we have excluded this allocation. Prior periods have been updated to be consistent with the presentation for the three and six months ended June 30, 2025. Financial information by business segment for each of the three and six months ended June 30, 2025 and 2024 is summarized in the following table (in thousands): Three Months Ended June 30, 2025 Australia Canada Corporate, other and eliminations Total Revenues $ 112,672 $ 50,022 $ — $ 162,694 Cost of sales and services 82,477 39,037 17 121,531 Revenues less cost of sales and services 30,195 10,985 ( 17 ) 41,163 Selling, general and administrative expenses (1) 6,716 4,128 9,626 20,470 Depreciation and amortization expense 9,050 8,751 26 17,827 Other operating expense (income) (2) ( 144 ) 21 189 66 Operating income (loss) 14,573 ( 1,915 ) ( 9,858 ) 2,800 Reconciliation to income (loss) before income taxes Other loss (3) ( 2,505 ) Income before income taxes $ 295 Capital expenditures $ 3,451 $ 1,047 $ — $ 4,498 Total assets $ 276,623 $ 681,264 $ ( 449,048 ) $ 508,839 18 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) Three Months Ended June 30, 2024 Australia Canada Corporate, other and eliminations Total Revenues $ 108,608 $ 79,527 $ 578 $ 188,713 Cost of sales and services 81,037 58,849 948 140,834 Revenues less cost of sales and services 27,571 20,678 ( 370 ) 47,879 Selling, general and administrative expenses (1) 5,956 4,467 7,010 17,433 Depreciation and amortization expense 7,695 9,252 112 17,059 Other operating expense (2) 64 105 106 275 Operating income (loss) 13,856 6,854 ( 7,598 ) 13,112 Reconciliation to income (loss) before income taxes Other loss (3) ( 1,839 ) Income before income taxes $ 11,273 Capital expenditures $ 3,652 $ 1,647 $ 17 $ 5,316 Total assets $ 207,465 $ 737,275 $ ( 461,506 ) $ 483,234 Six Months Ended June 30, 2025 Australia Canada Corporate, other and eliminations Total Revenues $ 216,318 $ 90,420 $ — $ 306,738 Cost of sales and services 159,197 76,682 267 236,146 Revenues less cost of sales and services 57,121 13,738 ( 267 ) 70,592 Selling, general and administrative expenses (1) 13,124 8,429 17,102 38,655 Depreciation and amortization expense 16,854 17,171 55 34,080 Other operating expense (income) (2) ( 69 ) 82 560 573 Operating income (loss) 27,212 ( 11,944 ) ( 17,984 ) ( 2,716 ) Recon to income (loss) before income taxes Other loss (3) ( 3,751 ) Loss before income taxes $ ( 6,467 ) Capital expenditures $ 5,396 $ 4,373 $ — $ 9,769 Total assets $ 276,623 $ 681,264 $ ( 449,048 ) $ 508,839 19 CIVEO CORPORATION NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued) Six Months Ended June 30, 2024 Australia Canada Corporate, other and eliminations Total Revenues $ 200,345 $ 146,687 $ 7,801 $ 354,833 Cost of sales and services 147,150 116,106 8,023 271,279 Revenues less cost of sales and services 53,195 30,581 ( 222 ) 83,554 Selling, general and administrative expenses (1) 11,268 9,336 15,469 36,073 Depreciation and amortization expense 14,932 18,648 249 33,829 Other operating expense (income) (2) 5,851 ( 5,962 ) 2,432 2,321 Operating income (loss) 21,144 8,559 ( 18,372 ) 11,331 Recon to income (loss) before income taxes Other loss (3) ( 3,703 ) Income before income taxes $ 7,628 Capital expenditures $ 8,170 $ 2,742 $ 17 $ 10,929 Total assets $ 207,465 $ 737,275 $ ( 461,506 ) $ 483,234 (1) Corporate, other and eliminations SG&A expense includes corporate information technology (IT) expenses managed on a worldwide basis that are not allocated to individual segments in Australia and Canada. During the three months ended June 30, 2025 and 2024, we recognized IT expenses at corporate not allocated of $ 2.0 million and $ 2.4 million, respectively. During the six months ended June 30, 2025 and 2024, we recognized IT expenses at corporate not allocated of $ 4.0 million and $ 4.6 million, respectively. (2) Other operating expense (income) for each reportable segment primarily includes other operating expenses for the three and six months ended June 30, 2025 and 2024. In addition, for the three and six months ended June 30, 2024, other operating expense (income) includes impairment expense in Canada and the U.S. and gain on sale of McClelland Lake Lodge assets, net, in Canada. (3) Other income (loss) is primarily related to interest expense, interest income and other income. 20 Cautionary Statement Regarding Forward-Looking Statements This Quarterly Report on Form 10-Q contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the Exchange Act). The Private Securities Litigation Reform Act of 1995 provides safe harbor provisions for forward-looking information. The forward-looking statements can be identified by the use of forward-looking terminology including “may,” “expect,” “anticipate,” “estimate,” “continue,” “believe” or other similar words. The forward-looking statements in this report include, but are not limited to, the statements in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” relating to our expectations about the macroeconomic environment and industry conditions, including the volatility in the price of and demand for commodities, as well as our expectations about capital expenditures in 2025, beliefs with respect to liquidity needs and expectations with respect to growth strategies and opportunities, share repurchases and dividends and benefits of the Qantac Acquisition. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of important factors. For a discussion of known material factors that could affect our results, refer to “Risk Factors” in this quarterly report and "Risk Factors", “Cautionary Statement Regarding Forward-Looking Statements,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2024 and our subsequent SEC filings. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may differ materially from those expected, estimated or projected. Our management believes these forward-looking statements are reasonable. However, you should not place undue reliance on these forward-looking statements, which are based only on our current expectations and are not guarantees of future performance. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the foregoing. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update or revise any of them in light of new information, future events or otherwise, except to the extent required by applicable law. In addition, in certain places in this quarterly report, we may refer to reports published by third parties that purport to describe trends or developments in the natural resources industry. We do so for the convenience of our shareholders and in an effort to provide information available in the market that will assist our investors in a better understanding of the market environment in which we operate. However, we specifically disclaim any responsibility for the accuracy and completeness of such information and undertake no obligation to update such information.