Q1 2024 Oceaneering International Inc Earnings Call

April 25, 2024

[noise] welcome everyone.

Ludi: I welcome everyone to Oceaneering's 2024 first quarter earnings conference call. My name is Ludi, and I will be your conference operator. All lines have been placed on mute to prevent any background noise. There will be a question and answer period after the speaker's remarks. With that, I will now turn the call over to Hilary Crespi, Oceaneering's Senior Director of Investor Relations. Please go ahead.

Judy: The Oceaneering 2024 first quarter earnings Conference call. My name is Judy you know it'll be a conference operator, all lines have been placed on mute to prevent any background noise. There will be a question and answer period after the Speakers' remarks.

Judy: With that I will now turn the call over to Hillary 50, Oceaneering Senior director of Investor Relations. Please go ahead.

Hilary Crespi: Good morning, and welcome to Oceaneering's first quarter 2024 results conference call. Today's call is being webcast, and a replay will be available on Oceaneering's website.

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Hillary: Good morning, and welcome to the Oceaneering first quarter 2024 results conference call today's call is being webcast and a replay will be available on oceaneering website.

Hilary Crespi: Joining us on the call are Rod Larson, President and Chief Executive Officer, who will be providing our prepared comments, Alan Curtis, Senior Vice President and Chief Financial Officer, and Mark Peterson, Vice President, Corporate Development and Investor Relations. Before we begin, I would like to remind participants that statements we make during the course of this call regarding our future financial performance, business strategy, plans for future operations, and industry conditions are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our comments today also include non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAP financial measures can be found in our first quarter press release.

Hillary: Joining us on the call are Rod Larson, President and Chief Executive Officer, who will be providing our prepared comments, Alan Curtis Senior Vice President and Chief Financial Officer, and Mark Peterson, Vice President corporate development and Investor Relations.

Hillary: Before we begin.

Hillary: Before we begin I would like to remind participants that statements. We make during the course of this call regarding our future financial performance business strategy plans for future operations and industry conditions are forward looking statements made pursuant to the safe Harbor provisions of the private Securities Litigation Reform Act of 19.

Hillary: 95, our comments today also include non-GAAP financial measures additional.

Hillary: Additional details and reconciliations to the most directly comparable GAAP financial measures can be found in our first quarter press release, we welcome your questions. After the prepared statements I will now turn the call over to Rod.

Hilary Crespi: We welcome your questions after the prepared statement. I will now turn the call over to Rod. Good morning. Thanks for joining the call today. And our earnings released yesterday, I...

Roderick A. Larson: Thanks for joining the call today.

Roderick A. Larson: In our earnings release yesterday, I stated that I was encouraged by our first quarter results. So let me give you a little more color in the first quarter of 2024, we achieved our highest first quarter EBITDA since 2016.

Roderick A. Larson: Good morning, and thanks for joining the call today. In our earnings release yesterday, I stated that I was encouraged by our first-quarter results, so let me give you a little more color. In the first quarter of 2024, we achieved our highest first-quarter EBITDA since 2016, and remotely operated vehicles, or ROV, revenue per day on hire for the quarter exceeded $10,000 for the first time since the fourth quarter of 2014. We saw continued solid order intake and bidding activity, as well as increased customer engagement with respect to our Max Mover Counterbalance workload.

Roderick A. Larson: Remotely operated vehicles or Rovs revenue per day on hire for the quarter exceeded $10000 for the first time since the fourth quarter of 2014.

Roderick A. Larson: We saw continued solid order intake and bidding activity as well as increased customer engagement with respect to our Max mover counterbalance workload.

Roderick A. Larson: These factors all reinforce our expectations for sustained multi-year growth in our traditional market, as well as future growth in developing markets, all of which I find encouraging as we continue to progress our strategic plan. As you probably noted in our earnings release, we have changed our results comparison to year-over-year instead of quarter-over-quarter as we've done in recent years. We believe this more accurately highlights the foundational growth that we see across our businesses and removes the seasonal impact that comes with sequential comparisons.

Roderick A. Larson: These factors all reinforce our expectations for a sustained multi year growth in our traditional markets as well as future growth in developing markets all of which I find encouraging as we continue to progress our strategic plan.

Roderick A. Larson: As you probably noted in our earnings release, we have changed our results comparison to year over year instead of quarter over quarter as we've done in recent years. We believe this more accurately highlights the foundational growth that we see across our businesses and removes the seasonal impact that comes with sequential comparisons.

Roderick A. Larson: Today I'll focus my comments on our performance for the first quarter of 2024 and our consolidated and business segment outlook for the second quarter and full year of 2024. Now for our results. For the first quarter, we reported net income of $15.1 million, or $0.15 per share, on revenue of $599 million. These results included the positive impact of $2.2 million in foreign exchange gains and the associated $0.8 million in tax effects, along with $0.2 million of expenses related to discrete tax adjustments.

Roderick A. Larson: Today I'll focus my comments on our performance for the first quarter of 2024, and our consolidated and business segment outlook for the second quarter and full year of 2024.

Roderick A. Larson: Now for our results.

Roderick A. Larson: For the first quarter, we reported net income of $15 1 million or <unk> 15 per share on revenue of $599 million.

Roderick A. Larson: These results included the positive impact of $2 2 million and foreign exchange gains and the associated with $8 million of tax effect, along with $2 million of expenses related to discrete tax adjustments.

Roderick A. Larson: Adjusted net income was $13.9 million, or $0.14 per share. Our consolidated first quarter 2024 operating income, as compared to first quarter 2023, was up 37%, and revenue was up 12%, with increases in all of our business segments, except for the Offshore Projects Group, or OPG. For the first quarter of 2024, our consolidated adjusted EBITDA of $61.7 million exceeded our guidance range and consensus estimates due to better-than-expected activity levels across our business. These results, when combined with our backlog and current levels of bidding activity, support our unchanged guidance for the year.

Roderick A. Larson: Adjusted net income was $13 $9 million or <unk> 14 per share.

Roderick A. Larson: Our consolidated first quarter 2020 for operating income as compared to first quarter 2023 was up 37% and revenue was up 12% with increases in all of our business segments, except for the offshore projects Group ROE V G for.

Roderick A. Larson: For the first quarter of 2020 for our consolidated adjusted EBITDA of $61 7 million exceeded our guidance range and consensus estimates on better than expected activity levels across our businesses. These results when combined with our backlog and current levels of bidding activity support our unchanged guidance for the year.

Roderick A. Larson: Now let's look at our business operations by segment for the first quarter of 2024 as compared to the first quarter of 2023. SSR operating income was 31% higher on an 11% increase in revenue and an improved operating income margin as compared to the first quarter of 2023. Even the margin also improved over the same period last year to 31% from 29%, largely due to improvements in ROE revenue per day on hire, utilization, and days on hire. Average ROV revenue per day on hire of $10,009 was 9% higher, utilization improved slightly to 64%, and days on hire increased 2%.

Roderick A. Larson: Now, let's look at our business operations by segment for the first quarter of 2024 as compared to the first quarter of 2023.

Roderick A. Larson: Our operating income was 31% higher on an 11% increase in revenue and an improved operating income margin as compared to the first quarter of 2023 EBITDA margin also improved over the same period last year to 31% from 29% largely due to improvements in row revenue per day on higher utilization and <unk>.

Roderick A. Larson: Days on hire.

Roderick A. Larson: Average RV revenue per day on hire of $10009 was 9% higher utilization improved slightly to 64% and days on hire increased 2%.

Operator: Excuse me, ladies and gentlemen, your conference will resume momentarily. Please stand by.

Speaker Change: Excuse me, ladies and gentlemen, your conference will resume momentarily please standby.

Operator: Excuse me, ladies and gentlemen, please continue to stand by; your conference will begin momentarily, and more.

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Operator: Excuse me, ladies and gentlemen. Please continue to stand by. Your conference will begin momentarily.

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Roderick A. Larson: Hey, my apologies. It looks like our line was disconnected, so not knowing for sure where we were cut off, I'm going to start from the beginning, and I'll do my best to be expeditious. Thanks for your patience. In our earnings release yesterday, I stated that I was encouraged by our first quarter results, so let me give you a little more color. In the first quarter of 2024, we achieved our highest first quarter EBITDA since 2016.

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Speaker Change: Thanks.

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Speaker Change: Excuse me, ladies and gentlemen, please continue to standby your conference will begin momentarily.

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Roderick A. Larson: Remotely operated vehicles, or ROV, revenue per day on hire for the quarter exceeded $10,000 for the first time since the fourth quarter of 2014. Additionally, we saw continued solid order intake and bidding activity, as well as increased customer engagement with respect to our Max Luber Counterbalance Forklift.

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Roderick A. Larson: These factors all reinforce our expectations for sustained multi-year growth in our traditional markets, as well as future growth in developing markets, all of which I find encouraging as we continue to progress our strategic plan. As you probably noted in our earnings release, we have changed our results comparison to year over year, instead of quarter over quarter, as we've done in recent years. We believe this more accurately highlights the foundational growth that we see across our businesses and removes the seasonal impact that comes with sequential comparison. Today, I'll focus my comments on our performance for the first quarter of 2024 and our consolidated and business segment outlook for the second quarter and full year of 2020. Now for our results.

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Roderick A. Larson: For the first quarter, we reported net income of $15.1 million, or $0.15 per share, on revenue of $599 million. These results included the positive impact of $2.2 million in foreign exchange gains and the associated $0.8 million of tax effects along with $0.2 million of expenses related to discrete tax adjustments. Adjusted net income was $13.9 million, or $0.14 per share, for our consolidated first quarter. 2024 operating income, as compared to the first quarter of 2023, was up 37%, and revenue was up 12%, with increases in all of our business segments except for our offshore projects group, OPG.

Speaker Change: Okay.

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Speaker Change: Hey, My apologies it looks like our line was disconnected so not knowing for sure where we were we were cut off I'm going to start from the beginning and I'll do my best to be expeditious. Thanks for your patience.

Speaker Change: In our earnings release yesterday, I stated that I was encouraged by our first quarter results. So let me give you a little more color in the first quarter of 2024, we achieved our highest first quarter EBITDA since 2016 remotely operated vehicles or RV revenue per day on hire for the quarter exceeded $10000 for the first time since the fourth quarter of 2014.

Speaker Change: And we saw continued solid order intake and bidding activity as well as increased customer engagement with respect to our Max Weaver counterbalanced forklift.

Roderick A. Larson: For the first quarter of 2024, our consolidated adjusted EBITDA of $61.7 million exceeded our guidance range and consensus estimates due to better-than-expected activity levels across our business. These results, when combined with our backlog and current levels of bidding activity, support our unchanged guidance for the year.

Speaker Change: These factors all reinforce our expectations for a sustained multi year growth in our traditional markets as well as future growth in developing markets all of which I find encouraging as we continue to progress our strategic plan.

Speaker Change: As you probably noted in our earnings release, we have changed our results comparison to year over year instead of quarter over quarter as we've done in recent years. We believe this more accurately highlights to foundational growth that we see across our businesses and removes the seasonal impact that comes with sequential comparisons today I'll focus my comments on our performance.

Roderick A. Larson: Now let's look at our business operations by segment for the first quarter of 2024 as compared to the first quarter of 2023. SSR's operating segment was 31% higher on an 11% increase in revenue and an improved operating income margin as compared to the first quarter of 2023. Even the margin also improved over the same period last year to 31% from 29%, largely due to improvements in ROV revenue per day on hire, utilization, and days on.

Speaker Change: <unk> for the first quarter of 2024, and our consolidated and business segment outlook for the second quarter and full year of 2024.

Speaker Change: Now for our results for.

Speaker Change: For the first quarter, we reported net income of $15 1 million or <unk> 15 per share on revenue of $599 million.

Speaker Change: These results included the positive impact of $2 $2 million in foreign exchange gains and the associated <unk> $8 million of tax effect, along with $2 million of expenses related to discrete tax adjustments. Adjusted net income was $13 9 million or <unk> 14 per share.

Roderick A. Larson: Average ROV revenue per day on hire of $10,009 was 9% higher, utilization improved slightly to 64%, and days on hire increased 2% to $14,536. ROV fleet use during the first quarter of 2024 was 66% in drill support and 34% in vessel-based activity compared to 65% and 35%, respectively, for the same period of 2023.

Speaker Change: Our consolidated first quarter.

Speaker Change: 2020 for operating income as compared to the first quarter of 2023 was up 37% and revenue was up 12% with increases in all of our business segments, except for offshore projects group <unk> for.

Speaker Change: For the first quarter of 2020 for our consolidated adjusted EBITDA of $61 7 million exceeded our guidance range and consensus estimates on better than expected activity levels across our businesses.

Roderick A. Larson: The revenue split between our ROV business and our combined tooling and survey businesses as a percentage of our total SSR revenue was 78% and 22%, respectively, compared to 77% and 23% in the same period of 2023. At the end of March, we had ROV contracts on 88 of the 149 floating rigs under contract, or 59%. This was slightly lower than the prior year, when we had ROV contracts on 90 of the 148 rigs under contract, or 61%.

Speaker Change: These results when combined with our backlog and current levels of bidding activity support our unchanged guidance for the year.

Speaker Change: Now, let's look at our business operations by segment for the first quarter of 2024 as compared to the first quarter of 2023.

Speaker Change: SSR operating segment was 31% higher on a 11% increase in revenue and an improved operating income margin as compared to the first quarter of 2023.

Roderick A. Larson: Turning to manufactured products, compared to the first quarter of 2023, operating income improved to $13.2 million, an increase of 17% on a 15% increase in revenue. Our backlog on March 31st, 2024 was $597 million, an increase of $151 million over the first quarter of 2023. Our book-to-bill ratio was 1.3 for the trailing 12 months as compared to 1.27 for the same period last year.

Speaker Change: EBITDA margin also improved over the same period last year to 31% from 29% largely due to improvements in <unk> revenue per day on higher utilization and days on hire.

Speaker Change: Average <unk> revenue per day on hire of $10009 was 9% higher utilization improved slightly to 64% and days on hire increased 2% to 14536.

Speaker Change: <unk> fleet used during the first quarter of 2024 was 66% in drill support and 34% in vessel based activity compared to the 65 and 35% respectively for the same period of 2023.

Roderick A. Larson: OPG's first quarter 2024 operating income and operating income margin declined as compared to the first quarter of 2023 due primarily to expenses and downtime associated with dry docks during the quarter. Excluding the dry dock impact, operating income margin would have approached the 5% achieved in the first quarter of 2023. For IMDS, first quarter 2024 operating income improved from the same quarter in the prior year on a 16% increase in revenue and a flat operating income margin of 5%.

Speaker Change: Revenue split between our RV business, and our combined tooling and survey businesses as a percentage of our total SSR revenue was 78, and 22% respectively compared to 77% and 23% in the same period of 2023.

Speaker Change: At the end of March we had RV contracts on 88 of the 149 floating rigs under contract or 59%. This was slightly lower than the prior year. When we had a row <unk> contracts on 90 of the 148 rigs under contract or 61%.

Speaker Change: Turning to manufactured products compared to the first quarter of 2023 operating income improved to $13 $2 million, an increase of 17% on a 15% increase in revenue.

Roderick A. Larson: Our ADTEC first quarter 2024 operating income increased by $4.3 million as compared to the first quarter of 2023 with an 8% increase in revenue and an improvement in operating income margin from 13% to 9%. Unallocated expenses of $38 million were below our guidance of $40 million for the quarter, but higher than the same period last year. In the first quarter of 2024, we utilized $69.7 million of cash in operating activities and $25.5 million in capital expenditures, resulting in a negative free cash flow of $95.2 million. Consistent with the past few years, our cash balance declined during the first quarter, ending with an ending cash position of $355 million and no borrowings under our Secured Revolving Credit Facility.

Speaker Change: Backlog on March 31, 2024 was $597 million, an increase of $151 million over the first quarter of 2023.

Speaker Change: Our book to Bill ratio was one three for the trailing 12 months as compared to our book to Bill ratio of one 7% for the same period last year.

Speaker Change: <unk> first quarter 2020 for operating income and operating income margin declined as compared to the first quarter of 2023, due primarily to expenses and downtime associated with dry docks during the quarter.

Speaker Change: Excluding the dry dock impact operating income margin would have approached the 5% achieved in the first quarter of 2023.

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Speaker Change: <unk> first quarter 2020 for operating income improved from the same quarter in the prior year on a 16% increase in revenue and flat operating income margin of 5%.

Roderick A. Larson: Now I'll address our outlook for the second quarter of 2024 as compared to the first quarter of 2020. On a consolidated basis, we expect our second quarter 2024 results to improve significantly, with adjusted earnings in the range of $80 to $90 million on a mid-teens percentage increase in revenue. Our expectations for our second quarter 2024 operations by segment are: For SSR, we are projecting higher activity levels across our ROE survey and tooling business, with higher segment operating profitability. ROV days on hire are expected to increase in both drill support and vessel-based activities, achieving utilization in the upper 60% to low 70% range.

Speaker Change: Our AD Tech first quarter 2024, operating income increased by $4 3 million as compared to the first quarter of 2023 with an 8% increase in revenue and improvement in operating income margin from 13% from 9%.

Speaker Change: Unallocated expenses of $38 million were below our guidance of $40 million for the quarter, but higher than the same period last year.

Speaker Change: In the first quarter of 2024, we utilized $69 $7 million of cash in operating activities and $25 5 million in capital expenditures, resulting in negative free cash flow of $95 2 million.

Speaker Change: <unk> with the past few years, our cash balance declined during the first quarter with an ending cash position of $355 million and no borrowings under our secured revolving credit facility.

Roderick A. Larson: SSR even a margin is forecast to be in the low 30%. For manufactured products, we anticipate revenue to increase in the low-teens percentage range with operating income margin to approximate our first quarter margin, leading to improved operating profitability in the second quarter of 2024. For OPG, we anticipate significantly higher revenue and operating results. Operating income margin is expected to be in the low to mid-teens range in the second quarter of 2024.

Speaker Change: Now I'll address I'll address our outlook for the second quarter of 2024 as compared to the first quarter of 2024.

Speaker Change: On a consolidated basis, we expect our second quarter 2024 results to improve significantly with adjusted EBITDA in the range of $80 million to $90 million on a mid teens percentage increase in revenue.

Speaker Change: Our expectations for our second quarter 2024 operations by segment are.

Speaker Change: For SSR, we are projecting higher activity levels across our ROE survey and tooling businesses with higher segment operating profitability.

Speaker Change: Row days on hire are expected to increase in both drill support and vessel based activities achieving utilization in the upper 60% to low 70% range.

Roderick A. Larson: This anticipation is based on a seasonal uptick in intervention, maintenance, and repair, or IMR activity, primarily in the Gulf of Mexico and West Africa, coupled with the absence of the dry dock impacts incurred in the first quarter.

Speaker Change: Our EBIT margin is forecast to be in the low 30% range.

Speaker Change: For manufactured products, we anticipate revenue to increase in the low teens percentage range with operating income margin to approximate our first quarter margin leading to improved operating profitability in the second quarter of 2024.

Roderick A. Larson: For IMDS, we expect relatively flat revenue and operating profitability. For ad tech, we expect higher revenue and lower operating income with operating margin in the low teens range on a shift in project timing. Unallocated expenses are expected to be in the $40 million range in the second quarter of 2020. Directionally, for our full year 2024 operations by segment, as compared to 2023, we forecast improved operating results on a low to mid-teens percentage increase in revenue. SSR EBITDA margins are projected to increase to the mid-30% range in the second half of the year, leading to a margin in the low to mid-30% range for the full year.

Speaker Change: For <unk>, we anticipate significantly higher revenue and operating results operating income margin is expected to be in the low to mid teens range in the second quarter of 2024. This anticipation is based on a seasonal uptick in intervention maintenance and repair or <unk> activity, primarily in the Gulf of Mexico, and West Africa, coupled with the <unk>.

Speaker Change: Absence of the dry dock impact incurred in the first quarter.

Speaker Change: Mds, we expect relatively flat revenue and operating profitability for AD Tech, we expect higher revenue and lower operating income with operating margin in the low teens range on a shift in project timing and mix.

Speaker Change: Unallocated expenses are expected to be in the $40 million range in the second quarter of 2024.

Speaker Change: Directionally for our full year 2024 operations by segment as compared to 2023, we expect for SSR, we forecast improved operating results on a low to mid teens percentage increase in revenue.

Roderick A. Larson: For ROVs, we expect ROV days on hire and revenue per day on hire to increase year-over-year. Our 2023 service mix of 63% drill support and 37% vessel-based services is expected to remain relatively the same in 2024, with higher vessel-based utilization during the seasonally higher second and third quarters. We estimate overall ROV fleet utilization to be in the high 60% to low 70% range, again with higher seasonal activity during the second and third quarters.

Speaker Change: Our EBITDA margins are projected to increase to the mid 30% range in the second half of the year, leading to a margin in the low to mid 30% range for the full year.

Speaker Change: For Rovs, we expect our <unk> days on hire and revenue per day on hire to increase year over year, our 2023 service mix of 63% drill support and 37% and vessel based services is expected to remain relatively the same in 2024 with higher vessel base utilization during the seasonally higher second and third quarters.

Roderick A. Larson: We continue to forecast that our market share for the drill support market will remain in the 55-60% range for the foreseeable future. For manufactured products, we expect operating income to increase on a greater than 10% increase in revenue, with a slight improvement in margin. This expectation is based on our year-end 2023 backlog of $622 million and the continuing strength of bidding activity in our energy business. We expect the segment book to bill ratio to be in the range of 1.1 to 1.3 for the year.

Speaker Change: We estimate overall ROE V fleet utilization to be in the high <unk> to low 70% range again with higher seasonal activity during the second and third quarters.

Speaker Change: We continue to forecast that our market share for drill support market will remain in the 55% to 60% range for the foreseeable future.

Speaker Change: For manufactured products, we expect operating income to increase on a greater than 10% increase in revenue with a slight improvement in margin. This expectation is based on our year end 2020 through backlog of $622 million.

Speaker Change: And continuing strength of bidding activity in our energy businesses. We expect segment book to Bill ratio to be in the range of $1 one to one three for the year.

Roderick A. Larson: In our Mobility Solutions business, we are seeing active customer interest as evidenced by recent interactions at the Logimat and MODEX industrial trade shows and subsequent engagement. In order to meet anticipated demand and lower product costs, we have selected a global contract manufacturing company for our Max Mover Counterbalance forklift product and are currently implementing a production line, which we expect to be fully operational in 2025.

Speaker Change: In our mobility solutions business, we are seeing active customer interest as evidenced by recent interactions at the larger Matt and <unk> industrial Tradeshows and subsequent engagements in order to meet anticipated demand and lower product cost. We have selected a global contract manufacturing company for IMAX movie Counterbalanced forklift product.

Speaker Change: And are currently implementing a production line, which we expect to be fully operational in 2025.

Roderick A. Larson: Pro-PG, we continue to expect operating results to improve on a slight decrease in revenue, with lower expected international activity being largely offset by increased utilization in the Gulf of Mexico. Overall, for 2024, OPG's operating income margin is expected to be in the mid-teens range for the year. For IMBS, we project slightly higher operating income results on increased revenue. However, we forecast year-over-year operating income margin to remain in the mid-single-digit range for the year. For ADTEC, operating income results are expected to be slightly higher on higher revenue, and the operating income margin is expected to be in the low teens range for the year.

Speaker Change: <unk>, we continue to expect operating results to improve on a slight decrease in revenue with lower expected international activity being largely offset by increased utilization in the Gulf of Mexico. Overall for 2024 OBG operating income margin is expected to be in the mid teens range for the year.

Speaker Change: For <unk>, we project slightly higher operating income results on increased revenue, we forecast year over year operating income margin to remain in the mid single digit range for the year.

Speaker Change: For AD Tech operating income results are expected to be slightly higher on higher revenue operating income margin is expected to be in the low teens range for the year.

Roderick A. Larson: On a consolidated basis, our estimated organic capital expenditure, Total for 2024 remains between $110 and $130 million. This includes approximately $50-$60 million of maintenance capital expenditures and $60-$70 million of growth capital expenditures. We forecast our 2024 cash income tax payments to be in the range of $80 to $90 million. Net interest expense is projected to be in the range of $24 to $28 million as we continue to benefit from investing our cash and from lower gross debt.

Speaker Change: On a consolidated basis, our estimated organic capital expenditure.

Speaker Change: Total for 2024 remains between 110 and $130 million. This includes approximately $50 million to $60 million of maintenance capital expenditures and $60 million to $70 million of growth capital expenditures, we forecast our 2024 cash income tax payments to be in the range of 80 to 90 million.

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Speaker Change: Net interest expense is projected to be in the range of $24 million to $28 million as we continue to benefit from investing our cash in from lower gross debt and unallocated.

Roderick A. Larson: And unallocated expenses are expected to average $40 million per quarter for the remainder of 2020. In summary, our first quarter performance and refreshed outlook for the year give us confidence to maintain our 2024 adjusted EBITDA guidance range of $330 to $380 million. It is worth noting that at the midpoint of our $110 million to $150 million pre-cash flow guidance range, we expect to generate free cash flow of $225 million somewhat ratably over the remainder of the year.

Speaker Change: <unk> expenses are expected to average $40 million per quarter for the remainder of 2024.

Speaker Change: In summary, our first quarter performance and refreshed outlook for the year give us confidence to maintain our 2024, adjusted EBITDA guidance range of $330 million to $380 million.

Speaker Change: It is worth noting that at the midpoint of our $110 million to $150 million free cash flow guidance range, we expect to generate free cash flow of $225 million somewhat ratably over the remainder of the year as mentioned on our last call. We understand our shareholders desire for return of excess capital and in response.

Roderick A. Larson: As mentioned on our last call, we understand our shareholders' desire for a return of excess capital, and in response, we have prepared a share repurchase strategy. For 2024 and beyond, we remain focused on our growth strategy in energy markets while increasing our participation in longer-term non-energy growth markets. We appreciate everyone's continued interest in Oceaneering. We look forward to seeing you at our Investor and Analyst event showcasing our robotics technology on May 9th. And if you've not already RSVPed, please do so.

Speaker Change: We have prepared a share repurchase strategy.

Speaker Change: For 2024 and beyond we remain focused on our growth strategy in energy markets and increasing our participation in longer term non energy growth markets.

Speaker Change: We appreciate everyone's continued interest in Oceaneering, we look forward to seeing you at our investor and analyst event showcasing our robotics technology on May nine.

Speaker Change: And if you've not already RSVP. Please do so.

Roderick A. Larson: Now, before I take some questions, I want to take a moment to acknowledge a significant milestone. Today is Mark's last earnings call. Since assuming the dual roles of investor relations and corporate development in 2018, a time when agility and adaptability were critical, Mark has been instrumental in shaping and sharing Oceaneering's narrative. His commitment to embodying our core values and telling our story has not only enriched our team, but has also contributed to developing and strengthening our relationships with our investors and analysts.

Speaker Change: Now before I take some questions I want to take a moment to acknowledge a significant milestone today as Mark's last earnings call.

Speaker Change: Since assuming the dual roles of Investor Relations and corporate development in 2018, a time, when agility and adaptability, where critical Mark has been instrumental in shaping and sharing oceaneering scenarios.

Speaker Change: His commitment to embody our core values and telling our story is not only enriched our team, but has also contributed to developing and strengthening our relationships with our investors and analysts.

Roderick A. Larson: Mark, your insights and dedication have left an indelible mark on our organization. And while we'll miss your guiding presence and keen wit, we look forward to hearing about your new adventures in retirement. Thank you for your steadfast leadership and many contributions to Oceaneering. Now, I'll be happy to take any questions you might have.

Speaker Change: Mark your insights and dedication of left an indelible mark on our organization and while we'll Miss your guiding presence and keen wit. We look forward to hearing about your new adventures in retirement. Thank you for your steadfast leadership and many contributions to oceaneering.

Speaker Change: Now.

Speaker Change: I'll be happy to take any questions you might have.

Operator: Thank you, and ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the number one on your touchtone phone. You will hear a prompt as your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the number two. If you are using a speakerphone, please leave the handset before pressing any keys. One moment, please for your first question. Your first question comes from the line of Kurt Hallead from Benchmark. Your line is open.

Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the number one on your Touchtone phone.

Speaker Change: You will hear Tom. Thank you hand, there's been rate should you wish to declines in the polling question. Please press the star followed by the numbers Youre.

Speaker Change: We are using a speaker phone please make your handset before pressing Andy keys.

Tom: Please for your first question.

Tom: Your first question comes from the line of Kurt Holley from Benchmark. Your line is open.

Kurt Kevin Hallead: Hey, good morning, everybody. Morning, Kurt. Hey, Mark, try not to be too bored in retirement, all right? Yes, sir.

Kurt Kevin Hallead: Hey, good morning, everybody good morning, Kurt.

Speaker Change: Mark.

Kurt Kevin Hallead: Newport and retirement alright.

Kurt Kevin Hallead: Yes, Sir.

Roderick A. Larson: Alright, so, uh... Congratulations on that. I think I appreciate all the information and insight and everything else. My curiosity still revolves around mobile robotics. I know that you had a number of different increases in order intake over the course of 2023. I just want to get an update as to what that order book looks like through the first quarter, and then maybe also touch on some of the benefits you expect to get from outsourcing the manufacturing for that business. Thanks.

Speaker Change: Right.

Speaker Change: Congratulations on that so I think.

Speaker Change: Appreciate all the E.

Speaker Change: The information and insight and everything else.

Speaker Change: My curiosity.

Speaker Change: It's around the global Robotics I know.

Speaker Change: Or that you had.

Speaker Change: Different.

Speaker Change: The increase in order intake over the course of <unk>.

Speaker Change: 2023, I just wanted to get an update as to what that would that order book looks like through the first quarter.

Speaker Change: And then maybe just also touch on some of the benefits you expect to get from outsourcing the manufacturing for that business. Thanks.

Roderick A. Larson: Sure, so kind of on the order book, we don't have anything that we've prepared to announce sort of on big new orders, but I will just say there's been a pretty steady flow of customers coming in and looking at the technology and getting pretty excited. I would expect just, you know, we had the first customer was pretty big about taking big orders or making big orders right away. What we're seeing on the next few will be trial orders. You know, they'll pick up a handful to try, and then the bigger orders come thereafter. But we are getting ready for that.

Speaker Change: Sure. So so kind of on the order book.

Speaker Change: We don't have anything that we are prepared to announce sort of on big new orders, but I will just say.

Speaker Change: There has been a pretty steady flow of customers coming in and looking at the technology and getting pretty excited.

Speaker Change: I would expect just.

Speaker Change: We've had the first customer was pretty big about taking.

Speaker Change: Big orders are making big orders right away, what we're seeing on the next few will be trial orders.

Speaker Change: They will pick up a handful to try.

Speaker Change: And then and then the bigger orders come thereafter, but we are getting ready for that.

Roderick A. Larson: Even the order book we have today, you talked about the contract manufacturer. Some of that will be built in our facility, but some of it will be built by the contract manufacturer. That's why we're getting that production line up. And what we really expect is, number one, that they build things in mass. So they're really good at sourcing very effectively, you know, leveraging their buying power and finding vendors that they have relationships with to get costs down on the individual components.

Speaker Change: Even the order book, we have today, you talked about the contract manufacture some of that will be built in our facility, but some of it will be built by the contract manufacturer Thats why we are getting that production line up and what we really expect is.

Speaker Change: Number one that there.

Speaker Change: Build things in mass so they are really good at sourcing very effectively leveraging there.

Speaker Change: Buying power and finding vendors that they have relationships with to get costs down on the on the individual components.

Roderick A. Larson: And then just being super efficient on the line as they put things together. The other thing I love about that is it frees us up to take the capacity we have now and preserve that for R&D to build, you know, the next version and the version after that and the auxiliary equipment that goes with the forklift. So we'll be using our space for more pilot builds and prototype builds while somebody else is doing the production build. So it really helps us go faster.

Speaker Change: And then and then just being Superefficient on the line as they put things together. The other thing I love about that is it frees us up to speed to take the capacity, we have now and preserve that for R&D to build the next version and the version after that and.

Speaker Change: The auxiliary equipment that go with the fork lift so we'll be we'll be using our space for more pilot pilot build and prototype build while somebody else is doing the production build so it really helps us go faster.

Kurt Kevin Hallead: Okay, appreciate that, Culler. Maybe just staying on that topic again, just wanted to get a general sense of whether or not you've taken another whack at the total addressable market for the specific robotics businesses that you're looking at.

Speaker Change: Okay I appreciate that color and maybe just staying on that topic again.

Speaker Change: I just wanted to get a general sense.

Speaker Change: Whether or not you've had taken another whack at what the total addressable market for the specific.

Speaker Change: Yeah robotics.

Speaker Change: Because it seems that youre looking at.

Roderick A. Larson: You know, we've pegged that market. We've talked about five growing to eight, I think, over the next few years. I don't know that we've seen a big change in what we think the total market is, but I do feel like we're getting more confident that the addressable market, meaning the portion that we think people are willing to convert to an autonomous forklift versus a driver forklift, I think that continues to grow.

Speaker Change: We pegged that market, we've talked about five growing to eight I think is over over the next few years. That's I don't I don't know that we've seen a big change in what we think the total market is but I do feel like we're getting more confidence that the addressable market, meaning the portion that we think people are willing to convert to an autonomous fork.

Speaker Change: Cliff versus a driver forklifts I think that continues to grow.

Roderick A. Larson: So kind of watch this space. This is one of the kind of leading-edge products, and the types of customers we're seeing and the people, you know, our list of kind of industries and places where these might go is actually growing as we see that interest develop at these two trade shows we were at, but also people have contacted us directly. So I think that's the biggest part, is how much can we actually convert to an autonomous product. Yeah.

Speaker Change: So kind of watch this space.

Speaker Change: This is one of the leading kind of leading edge product and the types of customers. We are seeing in the people. Our list of kind of industries in places where these might go actually is growing as we see that interest develop over these these two tradeshows we were at but also people who have contacted us directly. So I think thats. The biggest part is how much can we actually can.

Speaker Change: <unk> to an autonomous product, yes, I think we're still seeing market research, suggesting that 15% to 25% CAGR rate in this space, which is certainly.

Kurt Kevin Hallead: I think we're still seeing market research suggesting a 15-25% CAGR rate in this space, which is certainly a growth market. Okay, thanks guys.

Kurt Kevin Hallead: Okay, thanks guys, I appreciate it.

Speaker Change: Both market yes.

Speaker Change: Okay. Thanks, guys appreciate it.

Bill Austin: Your next question comes from the line of Bill Austin from Daniel Energy Partners. Your line is open.

Speaker Change: Your next question comes from the line of Bill Austen from Daniela and as your partners. Your line is open.

Bill Austin: Hey guys, thanks for taking my question. Good morning, Bill. Good morning.

Bill Austen: Hey, guys.

Bill Austen: For taking my question.

Bill Austen: Good morning Bill.

Bill Austin: And then I was going to follow up a little on Kurt, but I'll talk a bit about, you know, on the last call, you talked about manufactured products and how items with improving pricing will take a while to move through the backlog. I think you had previously said that in the second half of this year, we could see some improvement on margins. Will pricing continue to improve for those things that you're booking today?

Bill Austen: Good morning, and then.

Bill Austen: I was going to follow up a little on carpet I'll talk a bit about on.

Bill Austen: Last call you talked about manufactured products and how items with improving pricing will take a while to move through the backlog.

Bill Austen: I think you had previously said the second half of this year, we could see some improvement on margins.

Bill Austen: As pricing continued to improve for those things that you are booking today and how should we think about margin runway over the next couple of years based on that.

Roderick A. Larson: I'll talk a little bit about the change and I'll let Alan kind of wax on about the margin change. But, yeah, we do see it, and we see the backlog, the quality of the backlog. The pricing is good. You know, it kind of depends on one of the things that it depends on is that we're pretty well booked in the plants.

Bill Austen: Better pricing rolling through the businesses.

Speaker Change: I'll talk a little bit about the change.

Speaker Change: Alan kind of wax on the on the on the margin change, but yes, we do see it in and we see the backlog the quality of the backlog the pricing is good.

Speaker Change: It kind of depends on what are the things that it depends on it we're pretty well booked in.

Roderick A. Larson: So what we see comes in places like Greylock or Rotator or some of the other manufacturing areas, which are good margins but smaller, you know, smaller numbers, so we got to see those things fill in. We got to see some of the small gaps fill in in those businesses because those opportunistic bits of work are the ones that really bring margin, but we definitely see it happening. The other thing I'll offer is that we talk a lot about And so there are some of the ebbs and flows of the mobile robotics business that can sometimes make it hard to see what's going on in the energy products business. But that's what I'd say. If we were to break it out, you'd be able to see that more clearly, that we do see a pretty steady march. But Alan, I'll turn that over to you.

Speaker Change: In the plants. So what we see comes in places like Gray locker rotator or some of the other manufacturing areas, which are good margin, but smaller smaller numbers. So we've got to see those things fill in we got to see some of the small gaps fill in.

Speaker Change: In those businesses, because those those opportunistic sort of business.

Speaker Change: Bits of work are the ones that really bring margin, but we definitely see it happening. The other thing I'll offer is we talk a lot about what's happening, especially in the umbilical plants.

Speaker Change: And and we don't we still Havent cleanly broken out the the mobile robotics business and so there is some of the ebbs and flows of the mobile robotics business that they can sometimes make it hard to see what's going on in.

Speaker Change: And the energy products business, but but that's that's what I would say if we were to break it out you'd be able to see that more clearly that that we do see a pretty steady March but Alan I'll turn that over to you.

Speaker Change: <unk> captures a lot of it rod in the sense of.

Alan R. Curtis: Yeah, no, I think it captures a lot of it, Rod, in the sense that one of the things we see, Bill, is while it's great to have the visibility and the backlog, one thing that we have is a little bit of a nit when we get into the accounting for, I'll say, steel tubes, which are long-lead materials. Last you saw Q4, we had a little bit lower margin in this business segment.

Alan R. Curtis: One of the things we see bill is while it's great to have the visibility in the backlog one thing that we have is a little bit of a nuance when we get into the accounting for I'll say steel tubes, which are long lead materials last you saw in Q4, we had a bit lower margin in this business segment as we took those revenues.

Speaker Change: Basically no margin on those.

Speaker Change: Installed materials, we saw the benefit of that as we put them through the production phase of this time and added more value, we had higher margins and expect that to continue here.

Alan R. Curtis: We saw the benefit of that as we put them through the production phase this time and added more value. We had higher margins, and we expect that to continue. In the back half of this year, I would expect, from a margin perspective, good, strong revenues, but we will also probably be adding in more of these steel tubes on some new projects that we'll be commencing at that point in time. So margins could come down just a little bit, but that's a good indicator for 2025 at the. We'll start to progress some more through the factory at that point in time.

Speaker Change: In the back half of this year I would expect to see from a margin perspective, good strong revenues, but we will also probably be adding in more of these still tubes on some new projects that will be commencing at that point in time, so margins could come down just a little bit, but that's a good indicator for 2025 at the same time because.

Speaker Change: We'll start to progressive more through the factory at that point in time is just what we're currently seeing.

Alan R. Curtis: It's what we're currently seeing now. If we pull in production, it could be a little bit of a benefit.

Speaker Change: Full production it could be a little bit of a benefit.

Bill Austin: Well, thanks. And then, you know, just a little on Sub-Zoo Robotics. You guys did a demo for the U.S. Navy and Defense Innovation Unit in Norway. Do you guys mind talking a little bit more about that? You know, you had Phase 1, and when could Phase 2 begin? And, you know, do you have any framework around what the potential revenue opportunity for that type of thing could look like for you guys in the future?

Speaker Change: So that's what we're waiting right now.

Speaker Change: Okay.

Speaker Change: Well, Thanks, and then one more on <unk>.

Speaker Change: A little on the subsea robotics.

Speaker Change: You guys did a demo for the US Navy and defense Innovation unit, Norway, you guys might talk a little bit more about that yet phase one when could phase to begin in.

Speaker Change: Do you have any framework around what the potential revenue opportunity for that type of thing could look like for you guys in the future.

Roderick A. Larson: Well, we're in Phase 2, and Phase 2 is kind of where we go from what the product does to, you know, more about some of the other things they may want it to do. So that Phase 2 part is this, you know, this quarter.

Speaker Change: We're in phase III and phase II is kind of where we go from what the product does.

Speaker Change: To more about some of the some of the other things they may want it to do so that phase II part is this.

Speaker Change: This quarter.

Roderick A. Larson: That business, it's just a little bit hard to predict. It's, you know, because we don't know. They haven't really talked about scale, but it could be something that is significant. I'll just put it that way, that it's not going to. They're not really talking about a 1 or a 2. So, well, you know, depending on how far they want to take that, we'll know more when they decide. And part of it isn't that they're being coy with us.

Speaker Change: That that business, it's just a little bit hard to predict.

Speaker Change: <unk>.

Speaker Change: Does we don't know they haven't really talked about scale, but it could be something that is significant.

Speaker Change: Put it that way that it's not going to they're not really talking about a one or two so depending on how far they want to take that.

Speaker Change: It will be we'll know more when when they decide and part of it is isn't that they're being coy with us it depends on the capabilities. So obviously the more capabilities, we can deliver the more applications and more demand. So we'll we'll kind of watch this space, but I mean, thanks for bringing it up it is it is a pretty exciting thing we talk a lot about.

Roderick A. Larson: It depends on the capabilities. So obviously, the more capabilities we can deliver, the more applications, and the more demand. So we'll kind of watch this space, but, I mean, thanks for bringing it up. It is a pretty exciting thing. We talk a lot about, you know, what's going on with the max mover in the forklift on the terrestrial OMR. But on the submarine, these different applications for freedom are really broad and sort of the aperture of not just energy, not just sort of our typical work, but that some of this defense work could be pretty sizable.

Speaker Change: What's what's going with the Max mover in the fork lift on the terrestrial OMB, but on the subsea. These different applications for freedom has really broadened the aperture of not just energy not just not just sort of our typical work, but to some of this defense where it could be pretty sizeable.

Bill Austin: Great. Well, if you've got any questions, I'll let some other people ask some questions. Thanks a lot, guys.

Speaker Change: Great.

Speaker Change: You got my questions I'll, let some other people ask some questions.

Operator: Thank you. And once again, if you would like to ask a question, simply press star followed by the number one on your telephone keypad. We have a follow-up question coming from Kurt Hallead from Benchmark. Your line is open.

Speaker Change: Thank you and once again, if you would like to ask a question. Please press star followed by the number one on your telephone keypad.

Speaker Change: We have a follow up question coming from Greg Pardy from benchmark. Your line is open.

Kurt Kevin Hallead: Hey guys, you referenced that you have discussed or established a shareholder return of cash to shareholder program and talked about a share repurchase. What kind of additional details can you provide on that?

Greg Pardy: Hey, Hey, guys.

Greg Pardy: So you referenced yes.

Greg Pardy: Referenced that you have.

Greg Pardy: As discussed or established a a hero.

Greg Pardy: Let's turn to cash to shareholder program and talked about a share repurchase.

Greg Pardy: What kind of additional details can you provide on that.

Roderick A. Larson: Yeah, and I guess I don't really have an algorithm to share, but I'll kind of I'll share with you what we're looking at, Curtis, is we're really looking at, you know, the cash generation. Obviously, we got some we got some comments back on the cash burn in the first quarter. I hope people aren't overly focused on that because we always have a cash burn in the first quarter. One of the things that, unfortunately, we've seen in a couple of the past few years is that that didn't really come back until the fourth quarter.

Speaker Change: Yes, and I guess.

Speaker Change: I don't really have an algorithm to share, but I'll kind of I will share with you. What we're looking at is we're really looking at the cash generation. Obviously, we got some we got some some comments back on the cash burn in the first quarter I hope people aren't overly focused on that because we always have a cash burn in the first quarter one of the things that unfortunately.

Greg Pardy: We've seen in a couple of the past few years is that that didn't really come back until fourth quarter. So we saw the big drop in first quarter and you had to wait until fourth quarter to see if it looked like we're going to hit the number we don't see it being is back loaded. This time, we see that happen to more ratably and is and as it happens that gives us the comfort level to two.

Roderick A. Larson: So we saw, you know, the big drop in the first quarter, and you had to wait till the fourth quarter to see if it looked like we were going to hit the number. We don't see it being as backloaded this time.

Roderick A. Larson: We see that happening more realistically, and as it happens, that gives us the comfort level to work with the board and establish a repurchase number. Of course, I'm going to compare that cash available to the share price and make sure that it's a good deployment of capital and also against a couple, you know, some of the, especially the organic investment opportunities we've got on the plate. And we'll go back and forth.

Speaker Change: Work with the board and establish a repurchase number of course, I'm going to compare that that cash available to the share price and making sure that it's a good deployment of capital and also against the Cup.

Speaker Change: Some of the especially the organic invest.

Speaker Change: Investment opportunities, we've got on the plate and we will go back and forth, but we really.

Roderick A. Larson: But we really, I mean, I just guess I would share there that there's a lot of stuff that says, you know, it's hard, maybe, but there is a desire to do it. We got, you know, there's support from management, and there's certainly support on our board. But we just need to make sure that we're making the right decisions. We're being somewhat opportunistic about taking those shares at the right price and at the right time.

Speaker Change: I guess I would share that has a lot of stuff that says.

Greg Pardy: It's a hard maybe but there is a desire to do it we have their support for management and Theres certainly support on our board, but we just need to make sure that we're making we're making right decisions.

Greg Pardy: We're being we're being somewhat opportunistic about about taking those shares at the right price and at the right time.

Speaker Change: Okay I appreciate that and then follow up on the on the RV side of the business you guys referenced the increase in pricing for the quarter.

Roderick A. Larson: Okay, I'll appreciate that. And then I will follow up on the ROV side of the business. You guys referenced the increase in pricing for the quarter. Typically, ROV pricing does track pretty closely to deepwater rig rates, and I think the last time rig rates were, you know, $400,000, $500,000. I think your ROV rate was... $12,000 plus. So just want to get a general sense from you guys on, you know, what kind of continued momentum you would expect to see in terms of our relief pricing.

Speaker Change: Typically the RV pricing does track pretty closely to the deepwater rig rates and I think the last time rig rates were.

Speaker Change: 400, $500000 I gave you a royalty rate was.

Speaker Change: $12000 plus so just wanted to get a general sense from you guys on what kind of continued momentum you would expect to see in terms of pricing.

Roderick A. Larson: You know, I think we're still seeing some I mean, you know, we've talked about them having to work through the system, and you know, just even this year, we've negotiated some changes in rates.

Speaker Change: I think we're still seeing some I mean, we've talked about they have to work through the system and just even this year. We've negotiated some changes in rates. So some of that is still coming through.

Roderick A. Larson: So some of that is still coming through You know when you get to that that that higher number I would say it's it's we got it. We got to correct the leading edge to the to the to the average The leading edge rates we've seen above 12 even today depending on where we're operating in the world So, you know I think that we're I think that we're on track to get back to you know Kind of like rig rates when rig rates get back to where they were I think RV rates are going to get back on average to where they were and we talked about going back to Q Q 4 of 14.

Speaker Change: When you get to that higher number I would say, it's we got it we got to correct, a leading edge to the to the to the average.

Speaker Change: The leading edge rates, we've seen above 12, even today, depending on where we are operating in the world. So.

Speaker Change: I think that we're I think we're on track to get back to kind of like rig rates when rig rates get back to where they were I think RV rates are going to get back on average to where they were in when we talked about going back to Q <unk>.

Roderick A. Larson: So so we're definitely tracking that way with some with some movement left So I expect the the averages are going to continue to go up through this year and that's that's good news I the other thing I like to talk about when we talk about it is We want to talk about low points to high points in our in our own business versus percentages because the the rig rates went down a higher percentage than our V rates and so when we bring them back up with Rig rates double for example, our V rates aren't going to are going to double from the bottom But but we do expect it and we do expect to get very close and if not exceed the the RV rates we've seen above

Speaker Change: Q4 of 2014. So so we are definitely tracking that way with some with some movement left so I expect the averages are going to continue to go up through this year and that's that's good news the other thing I'd like to talk about when we talk about it is we.

Speaker Change: We want to talk about low points to high points in our in our own business versus percentages, because the rig rates went down a higher percentage than RV rates and so when we bring them back up with rig rates double for example, RMB rates arent going to are going to double from the bottom, but but we do expect we do expect to get very close and if not exceed.

Speaker Change: Good.

Speaker Change: The RV rates, we've seen in the past.

Speaker Change: Okay.

Kurt Kevin Hallead: Gotcha. Great. Thank you.

Speaker Change: Got you great. Thank you.

Operator: Thank you, and there are no further questions at this time. I would like to turn it back to Rob Larson for closing remarks.

Speaker Change: Yes.

Speaker Change: Thank you and there are no further questions at this time I would like to turn it back to Rod Larson for closing remarks.

Roderick A. Larson: Hey, thank you, and my apologies for the interruption in the middle of the broadcast. Thank you very much for everyone who stuck with us and dealt with maybe a little bit of repetition. But since there are no more questions, I'm going to thank Mark one more time. Mark, it's been a great run. Thanks for all your help, and just thank you all for joining the call. This concludes our fourth quarter 2024 conference call.

Roderick A. Larson: Thank you and my apologies for the interruption in the middle of the broadcast. Thank you very much for everyone, who stuck with us and dealt with maybe a little bit of repetition, but since there are no more questions I'm going to thank mark one more time, Mark it's been a great run.

Mark E. Peterson: Thanks for all your help and just thank you all for joining the call. This concludes our fourth quarter 2024 conference call.

Operator: Thank you, presenters, and ladies and gentlemen. This concludes today's conference call. Thank you for participating. You may now disconnect.

Speaker Change: Have a great day.

Speaker Change: Thank you presenters, ladies and gentlemen. This concludes today's conference call. Thank you for participating you may now disconnect.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Okay.

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