HELIX ENERGY SOLUTIONS GROUP INC 10-Q

Item 1. Financial Statements HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 2021 ​ ​ (Unaudited) ​ ​ ​ ASSETS ​ ​ Current assets: ​ ​ Cash and cash equivalents ​ $ 260,595 ​ $ 253,515 Restricted cash ​ 2,505 ​ 73,612 Accounts receivable, net of allowance for credit losses of $ 1,563 and $ 1,477 , respectively ​ 153,314 ​ 144,137 Other current assets ​ 68,990 ​ 58,274 Total current assets ​ 485,404 ​ 529,538 Property and equipment ​ 2,860,872 ​ 2,938,154 Less accumulated depreciation ​ ( 1,321,699 ) ​ ( 1,280,509 ) Property and equipment, net ​ 1,539,173 ​ 1,657,645 Operating lease right-of-use assets ​ 139,262 ​ 104,190 Other assets, net ​ 49,814 ​ 34,655 Total assets ​ $ 2,213,653 ​ $ 2,326,028 ​ ​ ​ ​ ​ ​ ​ LIABILITIES AND SHAREHOLDERS' EQUITY ​ ​ Current liabilities: ​ ​ Accounts payable ​ $ 99,716 ​ $ 87,959 Accrued liabilities ​ 85,180 ​ 91,712 Current maturities of long-term debt ​ 8,133 ​ 42,873 Current operating lease liabilities ​ 39,697 ​ 55,739 Total current liabilities ​ 232,726 ​ 278,283 Long-term debt ​ 258,977 ​ 262,137 Operating lease liabilities ​ 103,548 ​ 50,198 Deferred tax liabilities ​ 86,416 ​ 86,966 Other non-current liabilities ​ 196 ​ 975 Total liabilities ​ 681,863 ​ 678,559 Commitments and contingencies ​ ​ ​ ​ ​ ​ Shareholders’ equity: ​ ​ Common stock, no par, 240,000 shares authorized, 151,714 and 151,124 shares issued, respectively ​ 1,295,016 ​ 1,292,479 Retained earnings ​ 339,342 ​ 411,072 Accumulated other comprehensive loss ​ ( 102,568 ) ​ ( 56,082 ) Total shareholders’ equity ​ 1,531,790 ​ 1,647,469 Total liabilities and shareholders’ equity ​ $ 2,213,653 ​ $ 2,326,028 ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 3 Table of Contents HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 2022 2021 Net revenues ​ $ 162,612 ​ $ 161,941 ​ $ 312,737 ​ $ 325,356 Cost of sales ​ 163,966 ​ 158,811 ​ 332,700 ​ 307,602 Gross profit (loss) ​ ( 1,354 ) ​ 3,130 ​ ( 19,963 ) ​ 17,754 Loss on disposition of assets, net ​ — ​ ( 646 ) ​ — ​ ( 646 ) Selling, general and administrative expenses ​ ( 17,622 ) ​ ( 13,425 ) ​ ( 31,990 ) ​ ( 28,604 ) Loss from operations ​ ( 18,976 ) ​ ( 10,941 ) ​ ( 51,953 ) ​ ( 11,496 ) Equity in earnings of investment ​ 8,184 ​ — ​ 8,184 ​ — Net interest expense ​ ( 4,799 ) ​ ( 5,919 ) ​ ( 9,973 ) ​ ( 11,972 ) Other income (expense), net ​ ( 13,471 ) ​ 960 ​ ( 17,352 ) ​ 2,577 Royalty income and other ​ 797 ​ 249 ​ 2,938 ​ 2,306 Loss before income taxes ​ ( 28,265 ) ​ ( 15,651 ) ​ ( 68,156 ) ​ ( 18,585 ) Income tax provision (benefit) ​ 1,434 ​ ( 1,968 ) ​ 3,574 ​ ( 1,852 ) Net loss ​ ( 29,699 ) ​ ( 13,683 ) ​ ( 71,730 ) ​ ( 16,733 ) Net income (loss) attributable to redeemable noncontrolling interests ​ — ​ 26 ​ — ​ ( 146 ) Net loss attributable to common shareholders ​ $ ( 29,699 ) ​ $ ( 13,709 ) ​ $ ( 71,730 ) ​ $ ( 16,587 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loss per share of common stock: ​ ​ ​ ​ Basic ​ $ ( 0.20 ) ​ $ ( 0.09 ) ​ $ ( 0.47 ) ​ $ ( 0.11 ) Diluted ​ $ ( 0.20 ) ​ $ ( 0.09 ) ​ $ ( 0.47 ) ​ $ ( 0.11 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average common shares outstanding: ​ ​ ​ ​ Basic ​ 151,205 ​ 150,028 ​ 151,174 ​ 149,982 Diluted ​ 151,205 ​ 150,028 ​ 151,174 ​ 149,982 ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 4 Table of Contents HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 ​ 2022 2021 Net loss ​ $ ( 29,699 ) ​ $ ( 13,683 ) ​ $ ( 71,730 ) $ ( 16,733 ) Other comprehensive income (loss), net of tax: ​ ​ ​ ​ Foreign currency translation gain (loss) ​ ( 33,338 ) ​ 2,356 ​ ( 46,486 ) ​ 6,969 Other comprehensive income (loss), net of tax ​ ( 33,338 ) ​ 2,356 ​ ( 46,486 ) ​ 6,969 Comprehensive loss ​ ( 63,037 ) ​ ( 11,327 ) ​ ( 118,216 ) ​ ( 9,764 ) Less comprehensive income (loss) attributable to redeemable noncontrolling interests: ​ ​ ​ ​ Net income (loss) ​ — ​ 26 ​ — ​ ( 146 ) Foreign currency translation gain ​ — ​ 12 ​ — ​ 48 Comprehensive income (loss) attributable to redeemable noncontrolling interests ​ — ​ 38 ​ — ​ ( 98 ) Comprehensive loss attributable to common shareholders ​ $ ( 63,037 ) ​ $ ( 11,365 ) ​ $ ( 118,216 ) $ ( 9,666 ) ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 5 Table of Contents HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED) (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ Total ​ Redeemable ​ ​ Common Stock ​ Retained ​ Comprehensive ​ Shareholders’ ​ Noncontrolling ​ Shares Amount Earnings Loss Equity Interests Balance, March 31, 2022 151,637 ​ $ 1,292,935 ​ $ 369,041 ​ $ ( 69,230 ) ​ $ 1,592,746 $ — Net loss — ​ — ​ ( 29,699 ) ​ — ​ ( 29,699 ) ​ — Foreign currency translation adjustments — ​ — ​ — ​ ( 33,338 ) ​ ( 33,338 ) ​ — Activity in company stock plans, net and other 77 ​ 231 ​ — ​ — ​ 231 ​ — Share-based compensation — ​ 1,850 ​ — ​ — ​ 1,850 ​ — Balance, June 30, 2022 151,714 ​ $ 1,295,016 ​ $ 339,342 ​ $ ( 102,568 ) ​ $ 1,531,790 $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ Total ​ Redeemable ​ ​ Common Stock ​ Retained ​ Comprehensive ​ Shareholders’ ​ Noncontrolling ​ Shares Amount Earnings Loss Equity Interests Balance, March 31, 2021 150,715 ​ $ 1,286,380 ​ $ 468,087 ​ $ ( 47,007 ) ​ $ 1,707,460 $ 3,960 Net income (loss) — ​ — ​ ( 13,709 ) ​ — ​ ( 13,709 ) ​ 26 Foreign currency translation adjustments — ​ — ​ — ​ 2,356 ​ 2,356 ​ 12 Accretion of redeemable noncontrolling interests — ​ — ​ 1,730 ​ — ​ 1,730 ​ ( 1,730 ) Acquisition of redeemable noncontrolling interests ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 2,268 ) Activity in company stock plans, net and other 72 ​ 286 ​ — ​ — ​ 286 ​ — Share-based compensation — ​ 1,937 ​ — ​ — ​ 1,937 ​ — Balance, June 30, 2021 150,787 ​ $ 1,288,603 ​ $ 456,108 ​ $ ( 44,651 ) ​ $ 1,700,060 $ — ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 6 Table of Contents HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED) (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ Total ​ Redeemable ​ ​ Common Stock ​ Retained ​ Comprehensive ​ Shareholders’ ​ Noncontrolling ​ Shares Amount Earnings Loss Equity Interests Balance, December 31, 2021 151,124 ​ $ 1,292,479 ​ $ 411,072 ​ $ ( 56,082 ) ​ $ 1,647,469 $ — Net loss — ​ — ​ ( 71,730 ) ​ — ​ ( 71,730 ) ​ — Foreign currency translation adjustments — ​ — ​ — ​ ( 46,486 ) ​ ( 46,486 ) ​ — Activity in company stock plans, net and other 590 ​ ( 947 ) ​ — ​ — ​ ( 947 ) ​ — Share-based compensation — ​ 3,484 ​ — ​ — ​ 3,484 ​ — Balance, June 30, 2022 151,714 ​ $ 1,295,016 ​ $ 339,342 ​ $ ( 102,568 ) ​ $ 1,531,790 $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ Total ​ Redeemable ​ ​ Common Stock ​ Retained ​ Comprehensive ​ Shareholders’ ​ Noncontrolling ​ Shares Amount Earnings Loss Equity Interests Balance, December 31, 2020 150,341 ​ $ 1,327,592 ​ $ 464,524 ​ $ ( 51,620 ) ​ $ 1,740,496 $ 3,855 Net loss — ​ — ​ ( 16,587 ) ​ — ​ ( 16,587 ) ​ ( 146 ) Cumulative-effect adjustments upon adoption of ASU No. 2020-06 — ​ ( 41,456 ) ​ 6,682 ​ — ​ ( 34,774 ) ​ — Foreign currency translation adjustments — ​ — ​ — ​ 6,969 ​ 6,969 ​ 48 Accretion of redeemable noncontrolling interests — ​ — ​ 1,489 ​ — ​ 1,489 ​ ( 1,489 ) Acquisition of redeemable noncontrolling interests ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 2,268 ) Activity in company stock plans, net and other 446 ​ ( 1,314 ) ​ — ​ — ​ ( 1,314 ) ​ — Share-based compensation — ​ 3,781 ​ — ​ — ​ 3,781 ​ — Balance, June 30, 2021 150,787 ​ $ 1,288,603 ​ $ 456,108 ​ $ ( 44,651 ) ​ $ 1,700,060 $ — ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 7 Table of Contents HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ June 30, ​ 2022 2021 Cash flows from operating activities: ​ ​ ​ Net loss ​ $ ( 71,730 ) ​ $ ( 16,733 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: ​ ​ ​ Depreciation and amortization ​ 66,646 ​ 69,507 Amortization of debt issuance costs ​ 1,161 ​ 1,587 Share-based compensation ​ 3,572 ​ 3,901 Deferred income taxes ​ ( 550 ) ​ ( 3,649 ) Equity in earnings of investment ​ ( 8,184 ) ​ — Loss on disposition of assets, net ​ — ​ 646 Unrealized foreign currency (gain) loss ​ 12,578 ​ ( 1,366 ) Changes in operating assets and liabilities: ​ ​ Accounts receivable, net ​ ( 15,165 ) ​ 6,620 Other current assets ​ ​ ( 10,449 ) ​ ​ 16,017 Income tax payable, net of income tax receivable ​ 846 ​ 5,136 Accounts payable and accrued liabilities ​ 18,754 ​ 18,828 Other, net ​ ( 20,733 ) ​ ( 7,954 ) Net cash provided by (used in) operating activities ​ ( 23,254 ) ​ 92,540 ​ ​ ​ ​ ​ ​ ​ Cash flows from investing activities: ​ ​ Capital expenditures ​ ( 2,187 ) ​ ( 6,772 ) Distribution from equity investment, net ​ 7,840 ​ — Proceeds from sale of assets ​ ​ — ​ ​ 11 Net cash provided by (used in) investing activities ​ 5,653 ​ ( 6,761 ) ​ ​ ​ ​ ​ ​ ​ Cash flows from financing activities: ​ ​ Repayment of convertible senior notes ​ ( 35,000 ) ​ — Repayment of Term Loan ​ — ​ ( 1,750 ) Repayment of Nordea Q5000 Loan ​ — ​ ( 53,572 ) Repayment of MARAD Debt ​ ( 3,920 ) ​ ( 3,734 ) Debt issuance costs ​ ( 227 ) ​ ( 43 ) Acquisition of redeemable noncontrolling interests ​ ​ — ​ ​ ( 2,268 ) Payments related to tax withholding for share-based compensation ​ ( 1,525 ) ​ ( 1,878 ) Proceeds from issuance of ESPP shares ​ 353 ​ 443 Net cash used in financing activities ​ ( 40,319 ) ​ ( 62,802 ) ​ ​ ​ ​ ​ ​ ​ Effect of exchange rate changes on cash and cash equivalents and restricted cash ​ ( 6,107 ) ​ 896 Net increase (decrease) in cash and cash equivalents and restricted cash ​ ( 64,027 ) ​ 23,873 Cash and cash equivalents and restricted cash: ​ ​ Balance, beginning of year ​ 327,127 ​ 291,320 Balance, end of period ​ $ 263,100 ​ $ 315,193 ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 8 Table of Contents HELIX ENERGY SOLUTIONS GROUP, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) ​ Note 1 — Basis of Presentation and New Accounting Standards The accompanying condensed consolidated financial statements include the accounts of Helix Energy Solutions Group, Inc. and its subsidiaries (collectively, “Helix”). Unless the context indicates otherwise, the terms “we,” “us” and “our” in this report refer collectively to Helix and its subsidiaries. All material intercompany accounts and transactions have been eliminated. These unaudited condensed consolidated financial statements in U.S. dollars have been prepared in accordance with instructions for the Quarterly Report on Form 10-Q required to be filed with the Securities and Exchange Commission (the “SEC”) and do not include all information and footnotes normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the amounts reported in the financial statements and the related disclosures. Actual results may differ from our estimates. We have made all adjustments, which, unless otherwise disclosed, are of normal recurring nature, that we believe are necessary for a fair presentation of the condensed consolidated balance sheets, statements of operations, statements of comprehensive income (loss), statements of shareholders’ equity and statements of cash flows, as applicable. The operating results for the three- and six-month periods ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022. Our balance sheet as of December 31, 2021 included herein has been derived from the audited balance sheet as of December 31, 2021 included in our 2021 Annual Report on Form 10-K (our “2021 Form 10-K”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in our 2021 Form 10-K. Certain reclassifications were made to previously reported amounts in the consolidated financial statements and notes thereto to make them consistent with the current presentation format. We do not expect any recently issued accounting standards to have a material impact on our financial position, results of operations or cash flows when they become effective. ​ Note 2 — Company Overview We are an international offshore energy services company that provides specialty services to the offshore energy industry, with a focus on well intervention and robotics operations. Our services are centered on a three-legged business model: ● Production maximization — our assets and methodologies are specifically designed to efficiently enhance and extend the lives of existing oil and gas reserves; we also offer an alternative to take over end-of-life reserves in preparation for their abandonment; ● Decommissioning — we have historical success as a full-field abandonment contractor and believe that regulatory push for plug and abandonment (“P&A”) and transition to renewable energy will facilitate the continued growth of abandonment backlog; and ● Renewable energy support — we are an established global leader in jet trenching and continue to seek to provide specialty support services to offshore wind farm developments, including boulder removal and unexploded ordnance clearance. We provide services primarily in deepwater in the Gulf of Mexico, Brazil, North Sea, Asia Pacific and West Africa regions. On July 1, 2022, we completed the acquisition of the Alliance group of companies (collectively “Alliance”), expanding our service capabilities to shallow waters in the Gulf of Mexico. Our North Sea operations are subject to seasonal changes in demand, which generally peaks in the summer months and declines in the winter months. Our services are segregated into three reportable business segments: Well Intervention, Robotics and Production Facilities (Note 10). 9 Table of Contents Our Well Intervention segment provides services enabling our customers to safely access offshore wells for the purpose of performing production enhancement or decommissioning operations, thereby avoiding drilling new wells by extending the useful lives of existing wells and preserving the environment by preventing uncontrolled releases of oil and gas. Our well intervention vessels include the Q4000 , the Q5000 , the Q7000 , the Seawell , the Well Enhancer , and two chartered monohull vessels, the Siem H elix 1 and the Siem Helix 2 . Our well intervention equipment includes intervention systems such as intervention riser systems (“IRSs”), subsea intervention lubricators (“SILs”) and the Riserless Open-water Abandonment Module, some of which we provide on a stand-alone basis. Our Robotics segment provides offshore construction, trenching, seabed clearance, and inspection, repair and maintenance (“IRM”) services to both the oil and gas and the renewable energy markets globally, thereby assisting the delivery of affordable and reliable energy and supporting the responsible transition away from a carbon-based economy. Additionally, our Robotics services are used in and complement our well intervention services. Our Robotics segment includes remotely operated vehicles (“ROVs”), trenchers and robotics support vessels under term charters as well as spot vessels as needed. Our Production Facilities segment includes the Helix Producer I (the “ HP I ”), a ship-shaped dynamically positioned floating production vessel, the Helix Fast Response System (the “HFRS”), which combines the HP I , the Q4000 and the Q5000 with certain well control equipment that can be deployed to respond to a well control incident, and our ownership of oil and gas properties. We also have a 20 % ownership interest in Independence Hub, LLC (“Independence Hub”) that we account for using the equity method of accounting. In May 2022, we received a net cash distribution of $ 7.8 million from the sale of the “Independence Hub” platform owned by Independence Hub. All of our current Production Facilities activities are located in the Gulf of Mexico. ​ Note 3 — Details of Certain Accounts Other current assets consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 2021 Contract assets (Note 7) ​ $ 9,097 $ 639 Prepaids ​ 17,069 ​ 18,228 Deferred costs (Note 7) ​ 6,841 ​ 2,967 Income tax receivable ​ — ​ 1,116 Other receivable (Note 11) ​ 30,052 ​ 28,805 Other ​ 5,931 ​ 6,519 Total other current assets ​ $ 68,990 $ 58,274 ​ Other assets, net consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 2021 Deferred recertification and dry dock costs, net ​ $ 29,532 $ 16,291 Deferred costs (Note 7) ​ 1,857 ​ 381 Prepaid charter (1) ​ 12,544 ​ 12,544 Intangible assets with finite lives, net ​ 3,119 ​ 3,472 Other ​ 2,762 ​ 1,967 Total other assets, net ​ $ 49,814 $ 34,655 (1) Represents prepayments to the owner of the Siem Helix 1 and the Siem Helix 2 to offset certain payment obligations associated with the vessels at the end of their respective charter term. 10 Table of Contents Accrued liabilities consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 2021 Accrued payroll and related benefits ​ $ 24,924 $ 28,657 Accrued interest ​ ​ 6,379 ​ ​ 6,746 Income tax payable ​ 12 ​ — Deferred revenue (Note 7) ​ 6,386 ​ 8,272 Asset retirement obligations (Note 11) ​ 30,961 ​ 29,658 Other ​ 16,518 ​ 18,379 Total accrued liabilities ​ $ 85,180 $ 91,712 ​ Other non-current liabilities consist of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 2021 Deferred revenue (Note 7) ​ $ — $ 476 Other ​ 196 ​ 499 Total other non-current liabilities ​ $ 196 $ 975 ​ ​ Note 4 — Leases We charter vessels and lease facilities and equipment under non-cancelable contracts that expire on various dates through 2031. We also sublease some of our facilities under non-cancelable sublease agreements. The following table details the components of our lease cost (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 2022 2021 Operating lease cost ​ $ 13,798 ​ $ 14,839 ​ $ 28,260 $ 31,055 Variable lease cost ​ 4,625 ​ 3,635 ​ 9,547 ​ 7,119 Short-term lease cost ​ 7,571 ​ 5,243 ​ 13,009 ​ 6,975 Sublease income ​ ( 381 ) ​ ( 329 ) ​ ( 630 ) ​ ( 678 ) Net lease cost ​ $ 25,613 ​ $ 23,388 ​ $ 50,186 $ 44,471 ​ Maturities of our operating lease liabilities as of June 30, 2022 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Facilities and ​ ​ ​ Vessels Equipment Total Less than one year ​ $ 42,744 ​ $ 5,135 $ 47,879 One to two years ​ 34,404 ​ 4,672 ​ 39,076 Two to three years ​ 34,002 ​ 4,058 ​ 38,060 Three to four years ​ 17,155 ​ 916 ​ 18,071 Four to five years ​ 16,847 ​ 966 ​ 17,813 Over five years ​ — ​ 3,289 ​ 3,289 Total lease payments ​ $ 145,152 ​ $ 19,036 $ 164,188 Less: imputed interest ​ ( 18,030 ) ​ ( 2,913 ) ​ ( 20,943 ) Total operating lease liabilities ​ $ 127,122 ​ $ 16,123 $ 143,245 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current operating lease liabilities ​ $ 35,306 ​ $ 4,391 $ 39,697 Non-current operating lease liabilities ​ 91,816 ​ 11,732 ​ 103,548 Total operating lease liabilities ​ $ 127,122 ​ $ 16,123 $ 143,245 ​ 11 Table of Contents Maturities of our operating lease liabilities as of December 31, 2021 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Facilities and ​ ​ ​ Vessels Equipment Total Less than one year ​ $ 55,573 ​ $ 5,601 $ 61,174 One to two years ​ 34,580 ​ 4,844 ​ 39,424 Two to three years ​ 2,470 ​ 4,514 ​ 6,984 Three to four years ​ — ​ 2,462 ​ 2,462 Four to five years ​ — ​ 1,074 ​ 1,074 Over five years ​ — ​ 4,193 ​ 4,193 Total lease payments ​ $ 92,623 ​ $ 22,688 $ 115,311 Less: imputed interest ​ ( 5,633 ) ​ ( 3,741 ) ​ ( 9,374 ) Total operating lease liabilities ​ $ 86,990 ​ $ 18,947 $ 105,937 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current operating lease liabilities ​ $ 51,035 ​ $ 4,704 $ 55,739 Non-current operating lease liabilities ​ 35,955 ​ 14,243 ​ 50,198 Total operating lease liabilities ​ $ 86,990 ​ $ 18,947 $ 105,937 ​ The following table presents the weighted average remaining lease term and discount rate: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 ​ 2021 Weighted average remaining lease term 3.8 years ​ 2.4 years Weighted average discount rate 6.97 % ​ 7.57 % ​ The following table presents other information related to our operating leases (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ June 30, ​ 2022 2021 Cash paid for operating lease liabilities ​ $ 28,860 $ 31,562 Right-of-use assets obtained in exchange for new operating lease obligations (1) ​ 60,772 ​ 1,500 (1) Amount in 2022 primarily relates to the charter extensions for the Siem Helix 1 and the Siem Helix 2 (Note 12). ​ Note 5 — Long-Term Debt Scheduled maturities of our long-term debt outstanding as of June 30, 2022 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2023 ​ 2026 ​ MARAD ​ ​ ​ Notes Notes Debt Total Less than one year ​ $ — ​ $ — ​ $ 8,133 $ 8,133 One to two years ​ 30,000 ​ — ​ 8,538 ​ 38,538 Two to three years ​ — ​ — ​ 8,965 ​ 8,965 Three to four years ​ — ​ 200,000 ​ 9,412 ​ 209,412 Four to five years ​ — ​ — ​ 9,882 ​ 9,882 Gross debt ​ 30,000 ​ 200,000 ​ 44,930 ​ 274,930 Unamortized debt issuance costs (1) ​ ( 225 ) ​ ( 5,278 ) ​ ( 2,317 ) ​ ( 7,820 ) Total debt ​ 29,775 ​ 194,722 ​ 42,613 ​ 267,110 Less current maturities ​ — ​ — ​ ( 8,133 ) ​ ( 8,133 ) Long-term debt ​ $ 29,775 ​ $ 194,722 ​ $ 34,480 $ 258,977 (1) Debt issuance costs are amortized to interest expense over the term of the applicable debt agreement. 12 Table of Contents Below is a summary of certain components of our indebtedness: Credit Agreement On September 30, 2021, we entered into an asset-based credit agreement (the “ABL Facility”) with Bank of America, N.A. (“Bank of America”), Wells Fargo Bank, N.A. and Zions Bancorporation. The ABL Facility provides for an $ 80 million asset-based revolving credit facility, which matures on September 30, 2026 , with a springing maturity 91 days prior to the maturity of any outstanding indebtedness with a principal amount in excess of $ 50 million. The ABL Facility also permits us to request an increase of the facility by up to $ 70 million, subject to certain conditions. Commitments under the ABL Facility are comprised of separate U.S. and U.K. revolving credit facility commitments of $ 45 million and $ 35 million, respectively. The ABL Facility provides funding based on a borrowing base calculation that includes eligible U.S. and U.K. customer accounts receivable and cash, and provides for a $ 10 million sub-limit for the issuance of letters of credit. As of June 30, 2022, we had no borrowings under the ABL Facility, and our available borrowing capacity under that facility, based on the borrowing base, totaled $ 60.3 million, net of $ 2.3 million of letters of credit issued under that facility. We and certain of our U.S. and U.K. subsidiaries are the initial borrowers under the ABL Facility, whose obligations under the ABL Facility are guaranteed by those borrowers and certain other U.S. and U.K. subsidiaries, excluding Cal Dive I – Title XI, Inc. (“CDI Title XI”), Helix Offshore Services Limited and certain other enumerated subsidiaries. Other subsidiaries may be added as guarantors of the facility in the future. The ABL Facility is secured by all accounts receivable and designated deposit accounts of the U.S. borrowers and guarantors, and by substantially all of the assets of the U.K. borrowers and guarantors. U.S. borrowings under the ABL Facility initially bear interest at the LIBOR rate plus a margin of 1.50 % to 2.00 % or at a base rate plus a margin of 0.50 % to 1.00 %. U.K. borrowings under the ABL Facility denominated in U.S. dollars initially bear interest at the LIBOR rate and U.K. borrowings denominated in the British pound initially bear interest at the SONIA daily rate, each plus a margin of 1.50 % to 2.00 %. We also pay a commitment fee of 0.375 % to 0.50 % per annum on the unused portion of the facility. Beginning on the earlier of June 30, 2023, cessation of LIBOR or an earlier opt-in election, LIBOR will be replaced by either SOFR or term SOFR plus a margin of 0.114 % to 0.428 % or an alternate benchmark rate. The ABL Facility includes certain limitations on our ability to incur additional indebtedness, grant liens on assets, pay dividends and make distributions on equity interests, dispose of assets, make investments, repay certain indebtedness, engage in mergers, and other matters, in each case subject to certain exceptions. The ABL Facility contains customary default provisions which, if triggered, could result in acceleration of all amounts then outstanding. The ABL Facility requires us to satisfy and maintain a fixed charge coverage ratio of not less than 1.0 to 1.0 if availability is less than the greater of 10 % of the borrowing base or $ 8 million. The ABL Facility also requires us to maintain a pro forma minimum excess availability of $ 16 million for the 91 days prior to the maturity of each of our outstanding convertible senior notes. On July 1, 2022, we entered into a first amendment to the ABL Facility to (i) increase the asset-based revolving credit facility from $ 80 million to $ 100 million, (ii) replace LIBOR with Term SOFR (also known as CME Term SOFR), as administered by CME Group Inc., and make certain conforming changes therewith, (iii) increase the amount of permitted debt for the deferred purchase price of property from $ 25 million to $ 50 million, (iv) increase the fixed coverage charge ratio trigger from $ 8 million to $ 10 million, (v) increase the excess availability requirements prior to the maturity of our outstanding convertible senior notes from $ 16 million to $ 20 million, (vi) establish an excess availability requirement for the portion of any post-closing earn-out consideration related to our acquisition of all of the equity interests of Alliance that will be paid in cash (Note 16), and (vii) provide for potential pricing adjustments based on specific metrics and performance targets determined by us and Bank of America, as agent with respect to the ABL Facility, related to environmental, social and governance (“ESG”) changes implemented by us in our business. 13 Table of Contents Convertible Senior Notes Due 2022 (“2022 Notes”) We fully redeemed the $ 35 million remaining principal amount of the 2022 Notes plus accrued interest by delivering cash upon maturity on May 1, 2022. The effective interest rate for the 2022 Notes was 4.8 %. For the three- and six month periods ended June 30, 2022, total interest expense related to the 2022 Notes was $ 0.1 million and $ 0.6 million, respectively, primarily from coupon interest expense. For the three- and six-month periods ended June 30, 2021, total interest expense related to the 2022 Notes was $ 0.4 million and $ 0.8 million, respectively, with coupon interest expense of $ 0.4 million and $ 0.7 million, respectively, and the amortization of issuance costs of $ 0.1 million for the six-month period ended June 30, 2021. Convertible Senior Notes Due 2023 (“2023 Notes”) The 2023 Notes bear interest at a coupon interest rate of 4.125 % per annum payable semi-annually in arrears on March 15 and September 15 of each year until maturity. The 2023 Notes mature on September 15, 2023 unless earlier converted, redeemed or repurchased by us. The 2023 Notes are convertible by their holders at any time beginning March 15, 2023 at an initial conversion rate of 105.6133 shares of our common stock per $1,000 principal amount, which currently represents 3,168,399 potentially convertible shares at an initial conversion price of approximately $ 9.47 per share of common stock. Upon conversion, we have the right to satisfy our conversion obligation by delivering cash, shares of our common stock or any combination thereof. Prior to March 15, 2023, holders of the 2023 Notes may convert their notes if the closing price of our common stock exceeds 130 % of the conversion price for at least 20 days in the period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter (share price condition) or if the trading price of the 2023 Notes is equal to or less than 97 % of the conversion value of the notes during the five consecutive business days immediately after any ten consecutive trading day period (trading price condition). Holders of the 2023 Notes may also convert their notes if we make certain distributions on shares of our common stock or engage in certain corporate transactions, in which case the holders may be entitled to an increase in the conversion rate, depending on the price of our common shares and the time remaining to maturity, of up to 47.5260 shares of our common stock per $1,000 principal amount. Prior to March 15, 2021, the 2023 Notes were not redeemable. On or after March 15, 2021, we may redeem all or any portion of the 2023 Notes if the price of our common stock has been at least 130 % of the conversion price for at least 20 trading days during any 30 consecutive trading day period preceding our redemption notice. Any redemption would be payable in cash equal to 100 % of the principal amount to be redeemed plus accrued and unpaid interest and a “make-whole premium” calculated as the present value of all remaining scheduled interest payments. Holders of the 2023 Notes may convert any of their notes if we call the notes for redemption. Holders of the 2023 Notes may also require us to repurchase the notes following a “fundamental change,” which includes a change of control or a termination of trading of our common stock (as defined in the indenture governing the 2023 Notes). The indenture governing the 2023 Notes contains customary terms and covenants, including that upon certain events of default, the entire principal amount of and any accrued interest on the notes may be declared immediately due and payable. In the case of certain events of bankruptcy, insolvency or reorganization relating to us or a significant subsidiary, the principal amount of the 2023 Notes together with any accrued interest will become immediately due and payable. The effective interest rate for the 2023 Notes is 4.8 %. For the three- and six-month periods ended June 30, 2022, total interest expense related to the 2023 Notes was $ 0.3 million and $ 0.7 million, respectively, with coupon interest expense of $ 0.3 million and $ 0.6 million, respectively, and the amortization of debt issuance costs of $ 0.1 million for the six-month period ended June 30, 2022. For the three- and six-month periods ended June 30, 2021, total interest expense related to the 2023 Notes was $ 0.3 million and $ 0.7 million, respectively, with coupon interest expense of $ 0.3 million and $ 0.6 million, respectively, and the amortization of issuance costs of $ 0.1 million for the six-month period ended June 30, 2021. 14 Table of Contents Convertible Senior Notes Due 2026 (“2026 Notes”) The 2026 Notes bear interest at a coupon interest rate of 6.75 % per annum payable semi-annually in arrears on February 15 and August 15 of each year, beginning February 15, 2021 until maturity. The 2026 Notes mature on February 15, 2026 unless earlier converted, redeemed or repurchased by us. The 2026 Notes are convertible by their holders at any time beginning November 17, 2025 at an initial conversion rate of 143.3795 shares of our common stock per $1,000 principal amount, which currently represents 28,675,900 potentially convertible shares at an initial conversion price of approximately $ 6.97 per share of common stock. Upon conversion, we have the right to satisfy our conversion obligation by delivering cash, shares of our common stock or any combination thereof. Prior to November 17, 2025, holders of the 2026 Notes may convert their notes if the closing price of our common stock exceeds 130 % of the conversion price for at least 20 days in the period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter (share price condition) or if the trading price of the 2026 Notes is equal to or less than 97 % of the conversion value of the notes during the five consecutive business days immediately after any ten consecutive trading day period (trading price condition). Holders of the 2026 Notes may also convert their notes if we make certain distributions on shares of our common stock or engage in certain corporate transactions, in which case the holders may be entitled to an increase in the conversion rate, depending on the price of our common shares and the time remaining to maturity, of up to 64.5207 shares of our common stock per $1,000 principal amount. Prior to August 15, 2023, the 2026 Notes are not redeemable. On or after August 15, 2023, we may redeem all or any portion of the 2026 Notes if the price of our common stock has been at least 130 % of the conversion price for at least 20 trading days during any 30 consecutive trading day period preceding our redemption notice. Any redemption would be payable in cash equal to 100 % of the principal amount plus accrued and unpaid interest and a “make-whole premium” calculated as the present value of all remaining scheduled interest payments. Holders of the 2026 Notes may convert any of their notes if we call the notes for redemption. Holders of the 2026 Notes may also require us to repurchase the notes following a “fundamental change,” which includes a change of control or a termination of trading of our common stock (as defined in the indenture governing the 2026 Notes). The indenture governing the 2026 Notes contains customary terms and covenants, including that upon certain events of default, the entire principal amount of and any accrued interest on the notes may be declared immediately due and payable. In the case of certain events of bankruptcy, insolvency or reorganization relating to us or a significant subsidiary, the principal amount of the 2026 Notes together with any accrued interest will become immediately due and payable. The effective interest rate for the 2026 Notes is 7.6 %. For the three- and six-month periods ended June 30, 2022, total interest expense related to the 2026 Notes was $ 3.7 million and $ 7.4 million, respectively, with coupon interest expense of $ 3.4 million and $ 6.8 million, respectively, and the amortization of debt issuance costs of $ 0.3 million and $ 0.6 million, respectively. For the three- and six-month periods ended June 30, 2021, total interest expense related to the 2026 Notes was $ 3.7 million and $ 7.3 million, respectively, with coupon interest expense of $ 3.4 million and $ 6.7 million, respectively, and the amortization of debt issuance costs of $ 0.3 million and $ 0.6 million, respectively. 2026 Capped Calls In connection with the 2026 Notes offering, we entered into capped call transactions (the “2026 Capped Calls”) with three separate option counterparties. The 2026 Capped Calls are for an aggregate of 28,675,900 shares of our common stock, which corresponds to the shares into which the 2026 Notes are initially convertible. The capped call shares are subject to certain anti-dilution adjustments. Each capped call option has an initial strike price of approximately $ 6.97 per share, which corresponds to the initial conversion price of the 2026 Notes, and an initial cap price of approximately $ 8.42 per share. The strike and cap prices are subject to certain adjustments. The 2026 Capped Calls are intended to offset some or all of the potential dilution to Helix common shares caused by any conversion of the 2026 Notes up to the cap price. The 2026 Capped Calls can be settled in either net shares or cash at our option in components commencing December 15, 2025 and ending February 12, 2026, which could be extended under certain circumstances. 15 Table of Contents The 2026 Capped Calls are subject to either adjustment or termination upon the occurrence of specified extraordinary events affecting Helix, including a merger, tender offer, nationalization, insolvency or delisting. In addition, certain events may result in a termination of the 2026 Capped Calls, including changes in law, insolvency filings and hedging disruptions. The 2026 Capped Calls are recorded at their aggregate cost of $ 10.6 million as a reduction to common stock in the shareholders’ equity section of our condensed consolidated balance sheets. MARAD Debt In 2005, Helix’s subsidiary CDI – Title XI issued its U.S. Government Guaranteed Ship Financing Bonds, Q4000 Series, to refinance the construction financing originally granted in 2002 of the Q4000 vessel (the “MARAD Debt”). The MARAD Debt is guaranteed by the U.S. government pursuant to Title XI of the Merchant Marine Act of 1936, administered by the Maritime Administration (“MARAD”). The obligation of CDI Title XI to reimburse MARAD in the event CDI Title XI fails to repay the MARAD Debt is collateralized by the Q4000 and is guaranteed 50 % by us. In addition, we have agreed to bareboat charter the Q4000 from CDI Title XI for so long as the MARAD Debt remains outstanding. The MARAD Debt is payable in equal semi-annual installments, matures in February 2027 and bears interest at a rate of 4.93 %. The agreements relating to the bonds and the terms and conditions of our obligations to MARAD in respect of the MARAD Debt are typical for U.S. government-guaranteed ship financing transactions, including customary restrictions on incurring additional liens on the Q4000 and trading restrictions with respect to the vessel as well as working capital requirements. Other We previously had a credit agreement (and the amendments made thereafter, collectively the “Credit Agreement”) with a group of lenders led by Bank of America. The Credit Agreement was comprised of a term loan (the “Term Loan”) and a revolving credit facility (the “Revolving Credit Facility”) with a maximum availability of $ 175 million and had a maturity date of December 31, 2021. Concurrent with our entering into the ABL Facility on September 30, 2021, the Credit Agreement was terminated, the $ 28 million remaining balance of the Term Loan was repaid in full and the letters of credit issued under the Revolving Credit Facility were transferred to the ABL Facility. We had no borrowings under the Revolving Credit Facility. We previously had a credit agreement with a syndicated bank lending group for a term loan (the “Nordea Q5000 Loan”) to finance the construction of the Q5000 . The loan was secured by the Q5000 and its charter earnings. In January 2021, we repaid the remaining principal amount of $ 53.6 million. In accordance with the ABL Facility, the 2023 Notes, the 2026 Notes and the MARAD Debt, we are required to comply with certain covenants, including minimum liquidity and a springing fixed charge coverage ratio (applicable under certain conditions that are currently not applicable) with respect to the ABL Facility and the maintenance of net worth, working capital and debt-to-equity requirements with respect to the MARAD Debt. As of June 30, 2022, we were in compliance with these covenants. The following table details the components of our net interest expense (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 2022 2021 Interest expense ​ $ 5,034 ​ $ 5,943 ​ $ 10,341 $ 12,055 Interest income ​ ( 235 ) ​ ( 24 ) ​ ( 368 ) ​ ( 83 ) Net interest expense ​ $ 4,799 ​ $ 5,919 ​ $ 9,973 $ 11,972 ​ ​ 16 Table of Contents Note 6 — Income Taxes We operate in multiple jurisdictions with complex tax laws subject to interpretation and judgment. We believe that our application of such laws and the tax impact thereof are reasonable and fairly presented in our condensed consolidated financial statements. For the three- and six-month periods ended June 30, 2022, we recognized income tax expense of $ 1.4 million and $ 3.6 million, respectively, resulting in effective tax rates of ( 5.1 )% and ( 5.2 )%, respectively. For the three- and six-month periods ended June 30, 2021, we recognized income tax benefit of $ 2.0 million and $ 1.9 million, respectively, resulting in effective tax rates of 12.6 % and 10.0 %, respectively. These variances were primarily attributable to the earnings mix between our higher and lower tax rate jurisdictions as well as losses for which no financial statement benefits have been recognized. For the three- and six-month periods ended June 30, 2022, our aggregate tax expense was greater than the aggregate tax benefit of our losses, resulting in negative effective tax rates. The effective tax rates in those periods were significantly lower than the U.S. statutory rate primarily due to non-creditable foreign income and deemed profit taxes, as well as unbenefited tax losses. ​ Note 7 — Revenue from Contracts with Customers Disaggregation of Revenue Our revenues are primarily derived from short-term and long-term service contracts with customers. Our service contracts generally contain either provisions for specific time, material and equipment charges that are billed in accordance with the terms of such contracts (dayrate contracts) or lump sum payment provisions (lump sum contracts). We record revenues net of taxes collected from customers and remitted to governmental authorities. Contracts are classified as long-term if all or part of the contract is to be performed over a period extending beyond 12 months from the effective date of the contract. Long-term contracts may include multi-year agreements whereby the commitment for services in any one year may be short in duration. The following table provides information about disaggregated revenue by contract duration (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Well ​ ​ ​ Production ​ Intercompany ​ Total ​ Intervention Robotics Facilities Eliminations Revenue Three months ended June 30, 2022 ​ ​ ​ ​ ​ Short-term ​ $ 86,048 ​ $ 25,852 ​ $ — ​ $ — ​ $ 111,900 Long-term ​ 20,243 ​ 23,998 ​ 17,678 ​ ( 11,207 ) ​ 50,712 Total ​ $ 106,291 ​ $ 49,850 ​ $ 17,678 ​ $ ( 11,207 ) ​ $ 162,612 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three months ended June 30, 2021 ​ ​ ​ ​ ​ Short-term ​ $ 76,669 ​ $ 21,012 ​ $ — ​ $ — ​ $ 97,681 Long-term ​ 55,636 ​ 10,639 ​ 14,218 ​ ( 16,233 ) ​ 64,260 Total ​ $ 132,305 ​ $ 31,651 ​ $ 14,218 ​ $ ( 16,233 ) ​ $ 161,941 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six months ended June 30, 2022 ​ ​ ​ ​ ​ Short-term ​ $ 177,394 ​ $ 46,989 ​ $ — ​ $ ( 635 ) ​ $ 223,748 Long-term ​ 35,264 ​ 40,212 ​ 35,972 ​ ( 22,459 ) ​ 88,989 Total ​ $ 212,658 ​ $ 87,201 ​ $ 35,972 ​ $ ( 23,094 ) ​ $ 312,737 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six months ended June 30, 2021 ​ ​ ​ ​ ​ Short-term ​ $ 125,886 ​ $ 30,419 ​ $ — ​ $ — ​ $ 156,305 Long-term ​ 140,187 ​ 23,388 ​ 30,665 ​ ( 25,189 ) ​ 169,051 Total ​ $ 266,073 ​ $ 53,807 ​ $ 30,665 ​ $ ( 25,189 ) ​ $ 325,356 ​ 17 Table of Contents Contract Balances Accounts receivable are recognized when our right to consideration becomes unconditional. Contract assets are rights to consideration in exchange for services that we have provided to a customer when those rights are conditioned on our future performance. Contract assets generally consist of (i) demobilization fees recognized ratably over the contract term but invoiced upon completion of the demobilization activities and (ii) revenue recognized in excess of the amount billed to the customer for lump sum contracts when the cost-to-cost method of revenue recognition is utilized. Contract assets are reflected in “Other current assets” in the accompanying condensed consolidated balance sheets (Note 3). Contract assets were $ 9.1 million at June 30, 2022 and $ 0.6 million at December 31, 2021. We had no credit losses on our contract assets for the three- and six-month periods ended June 30, 2022 and 2021. Contract liabilities are obligations to provide future services to a customer for which we have already received, or have the unconditional right to receive, the consideration for those services from the customer. Contract liabilities may consist of (i) advance payments received from customers, including upfront mobilization fees allocated to a single performance obligation and recognized ratably over the contract term and/or (ii) amounts billed to the customer in excess of revenue recognized for lump sum contracts when the cost-to-cost method of revenue recognition is utilized. Contract liabilities are reflected as “Deferred revenue,” a component of “Accrued liabilities” and “Other non-current liabilities” in the accompanying condensed consolidated balance sheets (Note 3). Contract liabilities totaled $ 6.4 million at June 30, 2022 and $ 8.7 million at December 31, 2021. Revenue recognized for the three- and six-month periods ended June 30, 2022 included $ 3.5 million and $ 5.8 million, respectively, that were included in the contract liability balance at the beginning of each period. Revenue recognized for the three- and six-month periods ended June 30, 2021 included $ 4.2 million and $ 5.4 million, respectively, that were included in the contract liability balance at the beginning of each period. We report the net contract asset or contract liability position on a contract-by-contract basis at the end of each reporting period. Performance Obligations As of June 30, 2022, $ 551.5 million related to unsatisfied performance obligations was expected to be recognized as revenue in the future, with $ 232.4 million, $ 233.5 million and $ 85.6 million in 2022 , 2023 and 2024 , respectively. These amounts include fixed consideration and estimated variable consideration for both wholly and partially unsatisfied performance obligations, including mobilization and demobilization fees. These amounts are derived from the specific terms of our contracts, and the expected timing for revenue recognition is based on the estimated start date and duration of each contract according to the information known at June 30, 2022. For the three- and six-month periods ended June 30, 2022 and 2021, revenues recognized from performance obligations satisfied (or partially satisfied) in previous periods were immaterial. Contract Fulfillment Costs Contract fulfillment costs consist of costs incurred in fulfilling a contract with a customer. Our contract fulfillment costs primarily relate to costs incurred for mobilization of personnel and equipment at the beginning of a contract and costs incurred for demobilization at the end of a contract. Mobilization costs are deferred and amortized ratably over the contract term (including anticipated contract extensions) based on the pattern of the provision of services to which the contract fulfillment costs relate. Demobilization costs are recognized when incurred at the end of the contract. Deferred contract costs are reflected as “Deferred costs,” a component of “Other current assets” and “Other assets, net” in the accompanying condensed consolidated balance sheets (Note 3). Our deferred contract costs totaled $ 8.7 million at June 30, 2022 and $ 3.3 million at December 31, 2021. For the three- and six-month periods ended June 30, 2022, we recorded $ 6.6 million and $ 11.2 million, respectively, related to amortization of these deferred contract costs. For the three- and six-month periods ended June 30, 2021, we recorded $ 9.5 million and $ 19.9 million, respectively, related to amortization of these deferred contract costs. There were no associated impairment losses for any period presented. For additional information regarding revenue recognition, see Notes 2 and 12 to our 2021 Form 10-K. ​ 18 Table of Contents Note 8 — Earnings Per Share We have shares of restricted stock issued and outstanding that are currently unvested. Because holders of shares of unvested restricted stock are entitled to the same liquidation and dividend rights as the holders of our unrestricted common stock, we are required to compute basic and diluted earnings per share (“EPS”) under the two-class method in periods in which we have earnings. Under the two-class method, net income or loss attributable to common shareholders for each period is allocated based on the participation rights of both common shareholders and the holders of any participating securities as if earnings for the respective periods had been distributed. For periods in which we have a net loss we do not use the two-class method as holders of our restricted shares are not obligated to share in such losses. Basic EPS is computed by dividing net income or loss available to common shareholders by the weighted average shares of our common stock outstanding. The calculation of diluted EPS is similar to that for basic EPS, except that the denominator includes dilutive common stock equivalents and the numerator excludes the effects of dilutive common stock equivalents, if any. The computations of the numerator (earnings or loss) and denominator (shares) to derive the basic and diluted EPS amounts presented on the face of the accompanying condensed consolidated statements of operations are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Three Months Ended ​ ​ June 30, 2022 ​ June 30, 2021 ​ Income Shares Income Shares Basic and Diluted: ​ ​ Net loss attributable to common shareholders ​ $ ( 29,699 ) ​ ​ $ ( 13,709 ) Net loss available to common shareholders ​ $ ( 29,699 ) ​ 151,205 ​ $ ( 13,709 ) 150,028 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ Six Months Ended ​ ​ June 30, 2022 ​ June 30, 2021 ​ Income Shares Income Shares Basic and Diluted: ​ ​ Net loss attributable to common shareholders ​ $ ( 71,730 ) ​ ​ $ ( 16,587 ) Less: Accretion of redeemable noncontrolling interests ​ — ​ ​ ​ ( 241 ) Net loss available to common shareholders ​ $ ( 71,730 ) ​ 151,174 ​ $ ( 16,828 ) 149,982 ​ We had net losses for the three- and six-month periods ended June 30, 2022 and 2021. Accordingly, our diluted EPS calculation for these periods excluded any assumed exercise or conversion of common stock equivalents. These common stock equivalents were excluded because they were deemed to be anti-dilutive, meaning their inclusion would have reduced the reported net loss per share in the applicable periods. Shares that otherwise would have been included in the diluted per share calculations assuming we had earnings are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 2022 2021 Diluted shares (as reported) 151,205 150,028 151,174 149,982 Share-based awards 1,250 1,325 1,119 1,282 Total 152,455 151,353 152,293 151,264 ​ The following potentially dilutive shares related to the 2022 Notes, the 2023 Notes and the 2026 Notes were excluded from the diluted EPS calculation as they were anti-dilutive (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 2022 2021 2022 Notes — 2,519 1,211 2,519 2023 Notes 3,168 3,168 3,168 3,168 2026 Notes 28,676 28,676 28,676 28,676 ​ ​ 19 Table of Contents Note 9 — Employee Benefit Plans Long-Term Incentive Plan As of June 30, 2022, there were 4.2 million shares of our common stock available for issuance under our 2005 Long-Term Incentive Plan, as amended and restated (the “2005 Incentive Plan”). During the six-month period ended June 30, 2022, the following grants of share-based awards were made under the 2005 Incentive Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Grant Date ​ ​ ​ ​ ​ ​ ​ ​ Fair Value ​ ​ Date of Grant Award Type Shares/Units Per Share/Unit Vesting Period January 1, 2022 (1) RSU 1,065,705 ​ $ 3.12 33 % per year over three years January 4, 2022 (1) PSU 1,065,705 ​ $ 4.25 100 % on January 4, 2025 January 4, 2022 (2) Restricted stock 15,775 ​ $ 3.12 100 % on January 1, 2024 April 1, 2022 (2) Restricted stock 14,710 ​ $ 4.78 100 % on January 1, 2024 (1) Reflects grants to our executive officers. (2) Reflects grants to certain independent members of our Board of Directors (our “Board”) who have elected to take their quarterly fees in stock in lieu of cash, of which 8,013 shares granted on January 4, 2022 and 5,230 shares granted on April 1, 2022 vested upon the approval of our Board’s Compensation Committee in connection with the departure of an independent director during the second quarter 2022. Compensation cost for restricted stock is the product of the grant date fair value of each share and the number of shares granted and is recognized over the applicable vesting period on a straight-line basis. Forfeitures are recognized as they occur. No restricted stock awards have been granted to our executive officers or other employees in 2022. For the three- and six-month periods ended June 30, 2022, $ 0.8 million and $ 1.4 million, respectively, were recognized as share-based compensation related to restricted stock. For the three- and six-month periods ended June 30, 2021, $ 0.9 million and $ 1.7 million, respectively, were recognized as share-based compensation related to restricted stock. Our performance share units (“PSUs”) that were granted prior to 2021 are to be settled solely in shares of our common stock and are accounted for as equity awards. Those PSUs, which contain a service and a market condition, are based on the performance of our common stock against peer group companies. Our PSUs granted beginning 2021 may be settled in either cash or shares of our common stock upon vesting at the discretion of the Compensation Committee of our Board and have been accounted for as equity awards. Those PSUs consist of two components: (i) 50 % based on the performance of our common stock against peer group companies, which component contains a service and a market condition, and (ii) 50 % based on cumulative total Free Cash Flow, which component contains a service and a performance condition. Free Cash Flow is calculated as cash flows from operating activities less capital expenditures, net of proceeds from sale of assets. Our PSUs cliff vest at the end of a three-year period with the maximum amount of the award being 200 % of the original PSU awards and the minimum amount being zero . For PSUs that have a service and a market condition and are accounted for as equity awards, compensation cost is measured based on the grant date estimated fair value determined using a Monte Carlo simulation model and subsequently recognized over the vesting period on a straight-line basis. For PSUs that have a service and a performance condition and are accounted for as equity awards, compensation cost is initially measured based on the grant date fair value. Cumulative compensation cost is subsequently adjusted at the end of each reporting period to reflect the current estimation of achieving the performance condition. For the three- and six-month periods ended June 30, 2022, $ 1.1 million and $ 2.1 million, respectively, were recognized as share-based compensation related to equity PSUs. For the three- and six-month periods ended June 30, 2021, $ 1.0 million and $ 2.1 million, respectively, were recognized as share-based compensation related to equity PSUs. In January 2022, based on the performance of our common stock price as compared to our performance peer group over a three-year period, 559,150 equity PSUs granted in 2019 vested at 157 %, representing 876,469 shares of our common stock with a total market value of $ 3.2 million. 20 Table of Contents Our restricted stock units (“RSUs”) may be settled in either cash or shares of our common stock upon vesting at the discretion of the Compensation Committee and have been accounted for as liability awards. Liability RSUs are measured at their estimated fair value at each balance sheet date, and subsequent changes in the fair value of the awards are recognized in earnings for the portion of the award for which the requisite service period has elapsed. Cumulative compensation cost for vested liability RSUs equals the actual payout value upon vesting. For the three- and six-month periods ended June 30, 2022, $ 0.2 million and $ 0.8 million, respectively, were recognized as compensation cost. For the three- and six-month periods ended June 30, 2021, $ 0.2 million and $ 0.4 million, respectively, were recognized as compensation cost. In 2022 and 2021, we granted fixed-value cash awards of $ 5.1 million and $ 3.5 million, respectively, to select management employees under the 2005 Incentive Plan. The value of these cash awards is recognized on a straight-line basis over a vesting period of three years . For the three- and six-month periods ended June 30, 2022, $ 1.1 million and $ 2.1 million, respectively, were recognized as compensation cost. For the three- and six-month periods ended June 30, 2021, $ 1.0 million and $ 2.0 million, respectively, were recognized as compensation cost. Defined Contribution Plan We sponsor a defined contribution 401(k) retirement plan. Our discretionary contributions are in the form of cash and consist of a 50 % match of each participant’s contribution up to 5 % of the participant’s salary. Our discretionary contributions were suspended for 2021 and re-activated beginning January 2022. For the three- and six-month periods ended June 30, 2022, we made $ 0.4 million and $ 0.8 million, respectively, in contributions to the 401(k) plan. Employee Stock Purchase Plan We have an employee stock purchase plan (the “ESPP”). As of June 30, 2022, 1.4 million shares were available for issuance under the ESPP. The ESPP currently has a purchase limit of 260 shares per employee per purchase period. For more information regarding our employee benefit plans, including the 2005 Incentive Plan and the ESPP, see Note 14 to our 2021 Form 10-K. ​ Note 10 — Business Segment Information We have three reportable business segments: Well Intervention, Robotics and Production Facilities. Our U.S., U.K. and Brazil well intervention operating segments are aggregated into the Well Intervention segment for financial reporting purposes. Our Well Intervention segment provides services enabling our customers to safely access offshore wells for the purpose of performing production enhancement or decommissioning operations primarily in the Gulf of Mexico, Brazil, the North Sea and West Africa. Our well intervention vessels include the Q4000 , the Q5000 , the Q7000 , the Seawell , the Well Enhancer , and the Siem Helix 1 and Siem Helix 2 chartered vessels. Our well intervention equipment includes intervention systems, some of which we provide on a stand-alone basis. Our Robotics segment provides offshore construction, trenching, seabed clearance and IRM services to both the oil and gas and the renewable energy markets globally. Additionally, our Robotics services are used in and complement our well intervention services. Our Robotics segment includes ROVs, trenchers and robotics support vessels under term charters as well as spot vessels as needed. Our Production Facilities segment includes the HP I , the HFRS and our ownership of oil and gas properties (Note 11). All material intercompany transactions between the segments have been eliminated. 21 Table of Contents We evaluate our performance based on operating income of each reportable segment. Certain financial data by reportable segment are summarized as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 ​ 2022 2021 Net revenues — ​ ​ ​ ​ ​ Well Intervention ​ $ 106,291 ​ $ 132,305 ​ $ 212,658 ​ $ 266,073 Robotics ​ 49,850 ​ 31,651 ​ 87,201 ​ 53,807 Production Facilities ​ 17,678 ​ 14,218 ​ 35,972 ​ 30,665 Intercompany eliminations ​ ( 11,207 ) ​ ( 16,233 ) ​ ( 23,094 ) ​ ( 25,189 ) Total ​ $ 162,612 ​ $ 161,941 ​ $ 312,737 ​ $ 325,356 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income (loss) from operations — ​ ​ ​ ​ ​ Well Intervention ​ $ ( 22,548 ) ​ $ ( 6,719 ) ​ $ ( 54,306 ) ​ $ ( 1,476 ) Robotics ​ 9,666 ​ 255 ​ 11,146 ​ ( 2,679 ) Production Facilities ​ 6,045 ​ 4,682 ​ 11,896 ​ 11,196 Segment operating income (loss) ​ ( 6,837 ) ​ ( 1,782 ) ​ ( 31,264 ) ​ 7,041 Corporate, eliminations and other ​ ( 12,139 ) ​ ( 9,159 ) ​ ( 20,689 ) ​ ( 18,537 ) Total ​ $ ( 18,976 ) ​ $ ( 10,941 ) ​ $ ( 51,953 ) ​ $ ( 11,496 ) ​ Intercompany segment amounts are derived primarily from equipment and services provided to other business segments. Intercompany segment revenues are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ 2022 2021 2022 2021 Well Intervention ​ $ 3,893 ​ $ 10,206 ​ $ 7,743 ​ $ 12,793 Robotics ​ 7,314 ​ 6,027 ​ 15,351 ​ 12,396 Total ​ $ 11,207 ​ $ 16,233 ​ $ 23,094 ​ $ 25,189 ​ Segment assets are comprised of all assets attributable to each reportable segment. Corporate and other includes all assets not directly identifiable with our business segments. The following table reflects total assets by reportable segment (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ 2022 2021 Well Intervention ​ $ 1,830,655 ​ $ 2,012,214 Robotics ​ 88,781 ​ 96,249 Production Facilities ​ 113,984 ​ 119,004 Corporate and other ​ 180,233 ​ 98,561 Total ​ $ 2,213,653 ​ $ 2,326,028 ​ ​ Note 11 — Asset Retirement Obligations Asset retirement obligations (“AROs”) are recorded at fair value and consist of estimated costs for subsea infrastructure decommissioning and P&A activities associated with our oil and gas properties. The estimated costs are discounted to present value using a credit-adjusted risk-free discount rate. After its initial recognition, an ARO liability is increased for the passage of time as accretion expense, which is a component of our depreciation and amortization expense. An ARO liability may also change based on revisions in estimated costs and/or timing to settle the obligations. 22 Table of Contents Our AROs relate to our Droshky oil and gas properties that we acquired from Marathon Oil Corporation (“Marathon Oil”) in January 2019. In connection with assuming the P&A obligations related to those assets, we are entitled to receive agreed-upon amounts from Marathon Oil as the P&A work is completed. The following table describes the changes in our AROs (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ 2022 2021 AROs at January 1, ​ $ 29,658 ​ $ 30,913 Revisions in estimates ​ — ​ ( 2,631 ) Accretion expense ​ 1,303 ​ 48 AROs at June 30, ​ $ 30,961 ​ $ 28,330 ​ ​ Note 12 — Commitments and Contingencies and Other Matters Commitments We have long-term charter agreements with Siem Offshore AS for the Siem Helix 1 and Siem Helix 2 vessels. During the first quarter 2022, the charter agreements for the Siem Helix 1 and the Siem Helix 2 were extended to February 2025 and February 2027, respectively, with further options to extend. We have time charter agreements for the Grand Canyon II and Grand Canyon III vessels. The expiration date of the Grand Canyon II charter was extended to December 2022, with an option to renew. The Grand Canyon III charter expires May 2023. During the first quarter 2022, we executed short-term time charter agreements for the Horizon Enabler in the North Sea and the Shelia Bordelon in the Gulf of Mexico. Contingencies and Claims We believe that there are currently no contingencies that would have a material adverse effect on our financial position, results of operations or cash flows. Litigation We are involved in various legal proceedings, some involving claims under the General Maritime Laws of the United States and the Merchant Marine Act of 1920 (commonly referred to as the Jones Act). In addition, from time to time we receive other claims, such as contract and employment-related disputes, in the normal course of business. We are currently involved in several lawsuits filed by current and former offshore employees seeking overtime compensation. These suits are brought as collective actions and are in various stages of litigation. In one such lawsuit, during the third quarter 2021 the United States Court of Appeals for the Fifth Circuit issued a ruling adverse to us that may also have implications for some of the other cases in which we are involved, as well as the way offshore personnel are compensated throughout our industry. We further appealed that matter and in May 2022, the United States Supreme Court granted our petition for a writ of certiorari. We continue to vigorously defend these lawsuits. Notwithstanding that we believe we retain valid defenses, we have established a liability in certain of these matters. The final outcome of these matters remains uncertain, and the ultimate liability to us could be more or less than the liability established. ​ Note 13 — Statement of Cash Flow Information We define cash and cash equivalents as cash and all highly liquid financial instruments with original maturities of three months or less. We classify cash as restricted when there are legal or contractual restrictions for its withdrawal. The following table provides supplemental cash flow information (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ June 30, ​ 2022 2021 Interest paid ​ $ 9,550 ​ $ 10,601 Income taxes paid ​ 4,381 ​ 4,588 ​ Our capital additions include the acquisition of property and equipment for which payment has not been made. These non-cash capital additions totaled $ 0.3 million at June 30, 2022 and December 31, 2021. ​ 23 Table of Contents Note 14 — Allowance for Credit Losses We estimate current expected credit losses on our accounts receivable at each reporting date based on our credit loss history, adjusted for current factors including global economic and business conditions, offshore energy industry and market conditions, customer mix, contract payment terms and past due accounts receivable. The following table sets forth the activity in our allowance for credit losses (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ 2022 2021 Balance at January 1, ​ $ 1,477 ​ $ 3,469 Additions (reductions) (1) ​ 86 ​ ( 76 ) Write-offs (2) ​ ​ — ​ ​ ( 1,845 ) Balance at June 30, ​ $ 1,563 ​ $ 1,548 (1) Additions (reductions) in allowance for credit losses reflect credit loss reserves (releases) during the respective periods. (2) The write-offs of allowance for credit losses reflect certain receivables related to our Robotics segment that were previously reserved and subsequently deemed to be uncollectible. ​ Note 15 — Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value accounting rules establish a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: ● Level 1. Observable inputs such as quoted prices in active markets; ● Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and ● Level 3. Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions. Assets and liabilities measured at fair value are based on one or more of three valuation approaches as follows: (a) Market Approach. Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. (b) Cost Approach. Amount that would be required to replace the service capacity of an asset (replacement cost). (c) Income Approach. Techniques to convert expected future cash flows to a single present amount based on market expectations (including present value techniques, option-pricing and excess earnings models). Our financial instruments include cash and cash equivalents, receivables, accounts payable and long-term debt. The carrying amount of cash and cash equivalents, trade and other current receivables as well as accounts payable approximates fair value due to the short-term nature of these instruments. The principal amount and estimated fair value of our long-term debt are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2022 ​ December 31, 2021 ​ ​ Principal ​ Fair ​ Principal ​ Fair ​ Amount (1) Value (2) Amount (1) Value (2) MARAD Debt (matures February 2027) ​ $ 44,930 ​ $ 45,851 ​ $ 48,850 ​ $ 52,481 2022 Notes (matured May 2022) ​ — ​ — ​ 35,000 ​ 34,794 2023 Notes (mature September 2023) ​ 30,000 ​ 29,615 ​ 30,000 ​ 29,054 2026 Notes (mature February 2026) ​ 200,000 ​ 191,902 ​ 200,000 ​ 200,562 Total debt ​ $ 274,930 ​ $ 267,368 ​ $ 313,850 ​ $ 316,891 (1) Principal amount includes current maturities and excludes any related unamortized debt issuance costs. See Note 5 for additional disclosures on our long-term debt. 24 Table of Contents (2) The estimated fair value of the 2022 Notes, the 2023 Notes and the 2026 Notes was determined using Level 1 fair value inputs under the market approach. The fair value of the MARAD Debt was estimated using Level 2 fair value inputs under the market approach, which was determined using a third-party evaluation of the remaining average life and outstanding principal balance of the indebtedness as compared to other obligations in the marketplace with similar terms. ​ ​ Note 16 — Subsequent Events Alliance Acquisition On July 1, 2022, we completed our acquisition of all of the equity interests of Alliance for approximately $ 120 million cash at closing plus post-closing earn-out consideration payable in 2024 in the event the Alliance business achieves certain financial metrics in 2022 and 2023. Alliance provides services in support of the upstream and midstream ‎industries in the Gulf of Mexico shelf, including offshore oil field decommissioning and ‎reclamation, project management, engineered solutions, intervention, maintenance, repair, heavy lift and commercial diving services. The acquisition extends our energy transition strategy by adding shallow-water capabilities into what we expect to be a growing offshore decommissioning market. Due to the recent timing of the acquisition, the initial accounting for the Alliance acquisition is incomplete, and we are not able to disclose certain information relating to the acquisition, including the preliminary fair value of the contingent earn-out consideration, assets acquired and liabilities assumed. ​