Civeo Reports Mixed Q1 2025 Results with Canadian Weakness Offset by Australian Strength

Civeo Corporation reported mixed financial results for the first quarter of 2025, with consolidated revenue reaching $144.0 million despite facing notable challenges in its Canadian operations. The company's performance was characterized by continued strength in its Australian segment, which helped offset weaknesses in the Canadian market where pricing and billed rooms volume declined significantly.

The Canadian segment experienced a substantial revenue decline, with earnings dropping 40.0% year-over-year to $40.4 million. This downturn was primarily driven by reduced customer spending in the oil sands region and the loss of Fort Hills-related occupancy. In response to these challenges, Civeo implemented aggressive cost-cutting measures including a 25% reduction in Canadian headcount and the cold-shuttering of two lodges to improve operational efficiency.

Conversely, the Australian segment demonstrated remarkable resilience, posting a 13% year-over-year revenue growth to $103.6 million. This strong performance was driven by increased integrated services activity under a six-year, A$1.4 billion contract and strategic expansion in the Bowen Basin region. The company's diversified geographic presence has proven crucial in navigating regional market fluctuations.

Civeo has revised its 2025 guidance, now projecting revenue between $620 million and $650 million, with adjusted EBITDA expected to range from $75 million to $85 million. The company has also lowered its capital expenditure guidance to $20-$25 million, emphasizing disciplined capital deployment in response to market conditions. As part of its updated capital allocation strategy, Civeo increased its share repurchase authorization from 10% to 20% of shares outstanding.

The company repurchased 153,000 shares for approximately $3.3 million and suspended its quarterly dividend to prioritize buybacks and enhance financial flexibility. Civeo's net debt rose $20.9 million quarter-over-quarter to $59.0 million, resulting in a net leverage ratio of 0.8x. Despite these challenges, the company remains confident in its long-term free cash flow generation, supported by a capital-light model and a high mix of recurring asset-light services revenue that provides stability amid market volatility.