Q2 2025 Helix Energy Solutions Group Inc Earnings Call

July 24, 2025

<unk> Energy Solutions Group, Inc Earnings Conference call.

All lines have been placed on mute to prevent any background noise.

Speaker Change: The speakers remarks, there will be a question and answer session. If you would like to ask a question during that time simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question kind of press Star. One again. It is now my pleasure to turn today's call over to Brent are Jaeger, Vice president of finance and occur.

Speaker Change: Please go ahead.

Speaker Change: Good morning, everyone and thanks for joining us today on our conference call, where we will be reviewing our second quarter 2025 earnings release.

Speaker Change: Participating on this call for helix today are Owen Kratz, our CEO Scotty Sparks our COO.

Speaker Change: Eric Eric.

Speaker Change: Eric <unk> our CFO.

Speaker Change: <unk>, our general counsel.

Speaker Change: Daniel Stewart, our vice president of commercial and myself.

Speaker Change: Hopefully you've had an opportunity to review our press release and the related Slide presentation released last night. If you did not have a copy of these materials both can be accessed through the investor Relations page on our website at www Dot helix ESG Dot com.

Speaker Change: Our press release and slides can be access of the news and events tab.

Speaker Change: Before we begin our prepared remarks, Ken Neikirk will make a statement regarding forward looking information Ken <unk>.

Speaker Change: During this conference call, we anticipate making certain projections and forward looking statements based on our current expectations and assumptions as of today such forward looking statements may include projections and estimates of future events business or industry trends or business or financial results. All statements in this conference call or in the associated presentation. Other than statements of historical fact are.

Speaker Change: We're looking statements and are made under the safe Harbor provisions of the private Securities Litigation Reform Act of 1095.

Speaker Change: Our actual future results may differ materially from our projections and forward looking statements due to a number and variety of risks uncertainties assumptions and factors, including those set forth in slide two of our presentation and our most recently filed annual report on Form 10-K, our quarterly reports on Form 10-Q and in our other filings with the SEC you should not place undue reliance on forward looking.

Speaker Change: Statements and we do not undertake any duty to update any forward looking statements. We disclaim any written or oral statements made by any third party regarding the subject matter of this conference call.

Speaker Change: Also during this call certain non-GAAP financial disclosures may be made in accordance with SEC rules. The final slides of our presentation provide reconciliations of certain non-GAAP measures to comparable GAAP financial measures. These reconciliations.

Speaker Change: Affiliations along with this presentation the earnings press release, our annual report on Form 10-K, and a replay of this broadcast will be available under the for the investors section of our website at Www Dot helix ESG Dot com. Please remember that information on this conference call speaks only as of today July 24, 2025, and therefore, you are advised that any.

Speaker Change: Time sensitive information may no longer be accurate as of any replay of this call Scott.

Scott: Thanks, Ken.

Speaker Change: Good morning, everyone. Thank you for joining our call today, we hope everybody is doing well. This morning, we will review our second quarter financial performance and operations will provide our current markets and update our guidance for 2025.

Speaker Change: Teams offshore and onshore safely delivered another well executed quarter.

Speaker Change: Current safety statistics are among our best on record.

Speaker Change: Moving on to the presentation slides six and seven provide a high level summary of our results and key highlights for the quarter.

Speaker Change: As expected our second quarter results were negatively impacted by the regulatory talking at the Q 5000, the transits and demobilization of the Q4 thousand from Nigeria, and the market conditions in the U K, leading to the continued warm stacking of the seawell.

Speaker Change: In addition to these factors we also experienced a later start so a Gulf of America shelf season, and we incurred a high number of deferred mobilization days at the end of the second quarter on the Q five Q4 thousand and well enhancer that have shifted revenues into the next quarter.

Speaker Change: Revenues for the second quarter with $302 million with a gross profit of $15 million and a net loss of 3 million <unk>.

Speaker Change: Compared to $278 million revenue 28 million in gross profit and the net income of $3 million in Q1.

Speaker Change: Adjusted EBITDA was $42 million for the quarter and had a negative operating cash flow of $17 million resulted in negative free cash flow of $22 million.

Speaker Change: Year to date, we have generated revenues of $580 million gross profits of $42 million and a breakeven net income.

Speaker Change: Adjusted EBIT of $94 million.

Speaker Change: Our cash and liquidity remains strong with cash and cash equivalents of $320 million and liquidity of 375 at quarter end.

Speaker Change: Highlights for the quarter include Brazil operates in free vessels on longer term contracts successful completion of operations for the Q4 thousand in Nigeria, and safe passage back to the Gulf of America.

Speaker Change: Appointment of a fed photograph and utilization in the quarter for <unk>.

Speaker Change: Deployments of the J D assist in the <unk> filing the Baltic Sea.

Speaker Change: Execution of a three year framework agreements, we have excellent for shallow water decommissioning in the Gulf of America and in July we signed a multi year minimum 800 days trenching contract for the North Sea commencing in 2027, securing trenching work well into 2030.

Speaker Change: Over to slide nine slide nine provides a more detailed review of our segment results and segment and utilization.

Speaker Change: In the second quarter, we continued to operate globally with minimal operational disruption with operations in Europe Asia Pacific, Brazil Africa, the Gulf of America in the East Coast.

Speaker Change: Second quarter results were supported by strong seasonal improvements in robotics activity free well intervention vessels operating in Brazil, and the margin improvements in shallow water abandonment. These were offset by the regulatory reduction of the key 5000, the demobilization of the Q4 thousand in the second of the CLO.

The execution of a free your framework agreements with Exelon for shallow water decommissioning in the Gulf of America and in July we signed a multi year minimum 800 days trenching contract for the North Sea commencing in 2027 secure and trenching work well into 2030.

Speaker Change: Slide 10 provides further detail of our well intervention segment.

Speaker Change: The Q4 thousand completed operations in Nigeria, and a safe transit back to the Gulf of America during the quarter.

Over to slide nine slide nine provides a more detailed review of our segment results and segment and utilization.

Speaker Change: The vessel then perform the brief shipyard visit for planned repairs after which it commenced work on a free well decommissioning projects.

In the second quarter, we continued to operate globally with minimal operational disruption with operations in Europe Asia Pacific, Brazil Africa, the Gulf of America, and the U S East Coast.

Speaker Change: Due to some gaps in the schedule on completion of the works we plan to pull forward. The 2026 planned regulatory dockets into 2025 to facilitate a clean runway 2026.

Second quarter results were supported by strong seasonal improvements in robotics activity free well intervention vessels operating in Brazil, and the marginal improvements in shallow water abandonment.

Speaker Change: The key 5000 works on one well in the Gulf of America in Q2 prior to undertaking planned regulatory five year classing maintenance and inspection.

These were offset by the regulatory reduction of the key 5000, the demobilization of the Q4 thousand in the second of the Seawell.

Speaker Change: Vessel is currently working on a multi well program for one client prior to its scheduled return to work for shell.

Slide 10 provides further detail of our well intervention segment.

Speaker Change: In the North Sea, well enhancer had 100% utilization during the quarter working on four wells for free customers due.

The Q4 thousand completed operations in Nigeria, and a safe transit back to the Gulf of America during the quarter.

The vessel then perform the brief shipyard visit for planned repairs after which it commenced work on a free well decommissioning projects.

Speaker Change: Due to the well known market turmoil.

Speaker Change: The Seawell remained warm stacked and is expected to remain warm stacked since our low cost base for the remainder of 2025.

G to some gaps in the schedule on completion of the work we plan to pull forward. The 2026 planned regulatory docket into 2025 to facilitate a clean runway 2026.

Speaker Change: In Q2, the Q 7000 completed work on five wells with shell on the $400 decommissioning campaign in Brazil.

Speaker Change: <unk> had 94% utilization working for <unk> and in late Q3 early Q4. The vessel is expected to transfer to the free year Petrobras contract with the gasoline operations, whilst undergoing vessel acceptance.

The key 5000 works on one well in the Gulf of America in Q2 prior to undertaking planned regulatory five year class maintenance and inspection.

Vessel is currently working on a multi well program for one client prior to its scheduled return to work for shell.

Speaker Change: <unk> had a very strong quarter with 100% utilization for Petrobras.

In the North Sea, well enhancer had 100% utilization during the quarter working on four wells for free customers.

Speaker Change: Moving to slide 11.

Speaker Change: Slide 11 provides further detail of our robotics business.

Due to the well known market turmoil.

Speaker Change: Robotics had a strong quarter the business performed high standards operating seven vessels during the quarter working between Trenching RV support on site survey work on renewables in the oil and gas related projects globally.

The Seawell remained warm stacked and is expected to remain warm stacks, that's a low cost base for the remainder of 2025.

In Q2, the Q 7000 completed work on five wells with shell on the $400 decommissioning campaign in Brazil.

Speaker Change: <unk> with six vessels on renewables related projects within the quarter and had strong vessel utilization overall with free vessels working on trenching projects.

<unk> had 94% utilization working could tried it and in late Q3 early Q4. The vessel is expected to transfer to the free year Petrobras contract with a gap in operation as well as the undergoing vessel acceptance.

Speaker Change: We operated three vessels trenching spreads in Europe, including the GC free in the North Sea enabler with jet trenches in the J D assistant with the IPO.

Speaker Change: The glioma away, even the trim support vessels are working on renewables site clearance huge players in the IRA photographs in Europe, and the <unk> Board alone completed a small projects in the Gulf of America prior to transits into the East coast for renewables works.

<unk> had a very strong quarter with 100% utilization with Petrobras.

Moving to slide 11, Slide 11 provides further detail of our robotics business robotics had a strong quarter. The business performed high standards operating seven vessels during the quarter working between Trenching RV support on site survey work on renewables in the oil and gas related projects globally.

Speaker Change: Also in renewables, we have the <unk> 1400, one trench of working on a longer term contract from a third party vessel of Taiwan and in July we are mobilizing the T 40 to 102 on a third party vessel for a longer term contract in the Mediterranean.

Robotics, where six vessels on renewables related projects within the quarter and had strong vessel utilization overall with free vessels working on trenching projects.

Speaker Change: <unk> in the Asia Pacific region from the oil and gas support work offshore Malaysia during the quarter.

We operated three vessel trenching spreads in Europe, including the JC free in the North Sea enabler with jet trenches in the J D assistant with the IPO.

Speaker Change: Our renewables and trenching outlook remained very robust numerous contracted works in 2025 three to 2030, we were extremely pleased to recently announce that we executed a multiyear 800 day minimum trenching spread contract in the North Sea.

The glomar wave in the trim support vessels are working on renewables site clearance utilizing the IRA photographs in Europe, unless you're really bored alone completed a small projects in the Gulf of America prior to transits into the U S East coast for renewables works.

Speaker Change: The contract commences in 2027.

Speaker Change: Initial four year period, plus options and the long term outlook for global renewables market is very strong with a solid pipeline of tender activity as far out as 2032.

Also in renewables, we have the <unk> 1400, one trencher working on a longer term contract from a third party vessel of Taiwan and in July we are mobilizing the T 40, and 102 on a third party vessel for a longer term contract in the Mediterranean.

Speaker Change: Slide 12 provides detail of our shallow water development business.

Speaker Change: In Q2 activity there was increase the season commence led by the start of the season for the Hadrian heavy lift barge and an increase in utilization we have a high number of P&I spreads working offshore we.

The <unk> and the Asia Pacific region from the oil and gas support work offshore Malaysia Joel.

Our renewables and trenching outlook remained very robust nameless contracted works in 2025, 3% to 2030 with we are extremely pleased to recently announce that we executed a multiyear 800 day minimum trenching spread contract in the North Sea.

Speaker Change: We expect similar or improved activity into Q3, whilst 2025 continues to be a soft year. We continue to believe in the long term outlook of this segment as well as age and customers look to reduce that decommissioning obligations.

The contract commences in 2027.

Speaker Change: This is further supported by our recent award of a three year agreement for decommissioning services with Exxon.

Initial four year period, plus options and along some outlook for global renewables market is very strong with a solid pipeline of tender activity as far out as 2032.

Speaker Change: In summary, whilst we have seen a softer than expected UK intervention market and some potential gaps possible later in the year for the Q4 thousand due to work being pushed back into 2026.

Slide 12 provides detail of our shallow water development business.

In Q2 activity there was increased as the season commence led by the start of the season for the Hadrian heavy lift barge and an increase in utilization we have a high number of P&I spreads working offshore.

Speaker Change: We're encouraged by our strong robotics, and Brazil segments, and we are pleased to see improved tender activity with some quite sizable tenders in the U K noisily.

Brent Jaeger: We're expecting Q3 to be a very strong quarter I'd like to thank our employees for their efforts delivering again, it's a high level of execution and for secure and backlog and long term contracts and will now turn the call over to Brent.

We expect similar or improved activity in Q3, whilst 2025 continues to be a soft year. If we continue to believe in the long term outlook of this segment as well as age and customers look to reduce their decommissioning obligations.

Speaker Change: Yes.

Brent Jaeger: Thanks, Scotty moving to slide 14, it outlines our debt instruments and key balance sheet metrics as of June 30.

This is further supported by our recent award of a three year agreements with decommissioning services with Exxon.

Brent Jaeger: At quarter end, we had $320 million of cash and availability under the ABL facility of $70 million with the resulting liquidity of $375 million.

In summary, whilst we have seen a softer than expected UK intervention market and some potential gaps, possibly later in the year for the Q4 <unk> due to work being pushed back into 2026.

Brent Jaeger: Our funded debt was $319 million and we had negative net debt.

We're encouraged by our strong robotics, and Brazil segments, and we are pleased to see improved tender activity with some quite sizable tenders in the U K ignore <unk>.

Brent Jaeger: Of $8 million at quarter end our.

Brent Jaeger: Our balance sheet is strong and is expected to strengthen further as we anticipate generating meaningful free cash flow in the second half of 2025 and beyond and have minimal debt obligations between now and 2029.

We're expecting Q3 to be a very strong quarter.

Brent: Like to thank our employees for their efforts delivering again, it's a high level of execution and for secure and backlog and long term contracts I will now turn the call over to Brent.

Brent Jaeger: I'll now turn the call over to Erik for a discussion on our outlook.

Erik: Thanks Brent.

Brent: Thanks, Scotty moving to slide 14, it outlines our debt instruments and key balance sheet metrics as of June 30.

Erik: As we provide an outlook for the second half of 2025, our customers are reacting to the uncertainties created by the current geopolitical environment and the financial impact of low oil prices. Our customers are deferring work in the North Sea and Gulf of America impacting our well intervention in shallow water abandonment.

Brent: And we had $320 million of cash and availability under the ABL facility of $70 million with the resulting liquidity of $375 million.

Brent: Our funded debt was $319 million and we had negative net debt.

Erik: Segments were taking steps to mitigate the impacts of the slower market.

Brent: Of $8 million at quarter end our.

Brent: Our balance sheet is strong and is expected to strengthen further as we anticipate generating meaningful free cash flow in the second half of 2025 and beyond and have minimal debt obligations between now and 2029.

Erik: As discussed last quarter in the North Sea, we have stacked the seawell and the shallow water Benjamin segment, we have stacked five of our vessels.

Erik: This quarter in response to the slowing Gulf of America, well intervention market, we have accelerated the regulatory maintenance on the Q4 into 2025 from 2026. The maintenance period is expected to take approximately 30 days and we performed in the third quarter. This will limit the utilization on the Q4.

Erik: I'll now turn the call over to Erik for a discussion on our outlook.

Erik: Thanks, Brett.

Erik: During 2025 during this period of slower demand, but it is designed to provide greater availability in 2026.

Erik: Segments, we are taking steps to mitigate the impacts of the slower market.

Erik: In our outlook, we have endeavored to account for the increased uncertainty and risk in our markets. We are adjusting our outlook as follows.

Erik: As discussed last quarter in the North Sea, we have stacked the seawell and the shallow water Amendment segment, we have stacked five of our vessels.

Erik: Revenue to a range of one two to $1 3 billion and EBITDA to a range of $2 $25 million to $265 million.

Erik: Both revenue and EBITDA decreasing with the softer Gulf of America, well intervention market pre.

Erik: Free cash flow a range of 90 to 140 million variability driven by EBITDA changes as well as the ultimate working capital movements.

Erik: Capital of 70 to 80 million slight increase in Capex due to the acceleration of the regulatory maintenance period on the Q4 into 2025.

Erik: During 2025 during this period of slower demand, but is designed to provide greater availability in 2026.

Erik: In our outlook, we have endeavored to account for the increased uncertainty and risk in our markets.

Erik: These ranges include some key assumptions and estimates adjusting for the current market environment with any significant variation from these assumptions and estimates, causing results. It could fall outside of our estimates and ranges provided.

Erik: Adjusting our outlook as follows revenue to a range of one two to $1 3 billion and EBITDA to a range of $2 $25 million to $265 million, both revenue and EBITDA decreasing with the softer Gulf of America, well intervention market pre.

Erik: Our quarterly results typically follow a seasonal pacing with more active summer months and slower winter months for the second half of 2025, we expect the third quarter to be our strongest quarter of 2025 with good contract coverage. The tightening of our expected free cash flow generation is concentrated in the latter half of the year.

Erik: Free cash flow a range of $90 million to $140 million.

Erik: The ability driven by EBITDA changes as well as the ultimate working capital movements.

Erik: Capital of 70 to 80 million slight increase in Capex due to the acceleration of the regulatory maintenance period on the Q4 thousand into 2025.

Erik: Vessels expected to be available in September we are pursuing opportunities, but do expect gaps in our schedules.

Erik: <unk> has strong contract coverage and is expected to have high utilization into 2026.

Erik: As discussed the UK North Sea is weak and we have stack the seawell focusing work on the well enhancer.

Erik: Enhancer is expected to have good utilization into Q4.

Erik: Q seven thousands operating for shell in Brazil on a firm 400 day project with.

Erik: Providing our key assumptions by segment first with our well intervention segment for Q4 thousand is currently completing a project and scheduled to commence regulatory dock in by the end of July the vessels expected to be available in September we are pursuing opportunities, but do expect gaps in our schedules.

Erik: The Siem helix shoes on contract for Petrobras the Siem Helix. One is currently performing well abandonment for Trident with contracted work to extend to the end of Q3, followed by a three year contract with Petrobras.

Erik: Vessels expected to have an approximate 30 day off hire periods as it transitions for vessel acceptance between contracts.

Erik: <unk> has strong contract coverage and expect it to have high utilization into 2020.

Erik: Moving to the robotics segment. It continues to generate positive returns bidding activity has been and continues to be extremely active we recently announced a significant trenching contract in the north sea representing over 800 days of trenching beginning in 2027.

Erik: As discussed the UK North Sea is weak and we have stack. The seawell are focusing work on the well enhancer. The well enhancer is expected to have good utilization into Q4.

Erik: Q seven thousands operating for shell in Brazil on a firm 400 day project.

Erik: In the North Sea the Grand Canyon III is expected to have an active trenching season with overall strong utilization the north sea neighbor has contracted trenching projects into Q4, the <unk> wave and trim are forecasted to have good utilization performing site clearance operations team.

Erik: The Siem helix shoes on contract for Petrobras.

Erik: <unk> is currently performing well abandonment for Trident with contracted work to extend to the end of Q3, followed by a three year contract with Petrobras.

Erik: The vessel is expected to have an approximate 30 day off hire periods as it transitions for vessel acceptance between contracts.

Erik: <unk> thousand 302 is contracted for its first work in the Mediterranean in the second half of 2025.

Erik: The APAC region. The Grand Canyon II is contracted work through Q4. The tea for 101 is trencher is working on client provided vessel is expected to remain in Taiwan through the end of 'twenty five the U S. Initially.

Erik: Boardwalk has contracted work and Gulf of America, and the U S. East Coast into Q3, then is scheduled to transition back to the Gulf coast with good utilization expected into Q4.

Erik: In the North Sea the Grand Canyon III is expected to have an active trenching season with overall strong utilization the north sea neighbor has contracted trenching projects into Q4, the <unk> wave and trim. Our fault I said to have good utilization performing site clearance operations.

Erik: Moving to production facilities. The HP one is on contract balance of 25 recently extended to June of 2006 with no current expected change we.

Erik: <unk> thousand 502 is contracted for its first work in the Mediterranean in the second half of 2025.

Erik: We do have expected variability with production as the Droshky field continues to deplete in Thunder Hawk field shut in.

Erik: The APAC region. The Grand Canyon II is contracted work through Q4. The <unk> 101 is trencher is working on client provided vessel is expected to remain in Taiwan through the end of 'twenty five the.

Erik: Continuing our shallow water abandonment segment.

Erik: <unk> third quarter before being impacted by the normal seasonal slowdown during the fourth quarter.

Erik: The offshore marine business to maintain good utilization on five to seven lift boats with some variable seasonality on the OSV and crew boats.

Erik: <unk>.

Erik: Boardwalk has contracted work and Gulf of America, and the U S. East Coast into Q3, then is scheduled to transition back to the Gulf coast with good utilization expected into Q4.

Erik: Energy services should have seasonal utilization for up to 10, P&A spreads to two coiled tubing units and 25.

Erik: Moving to production facilities. The HP one is on contract balance of 25 recently extended to June of 2006 with no current expected change.

Erik: There is seasonality in the diving in heavy lift business, where the epic Hebron and diving vessels are expected to have good utilization during Q3, but slowdown during Q4.

Erik: We do have expected variability with production as the Droshky field continues to deplete in Thunder Hawk field shut in.

Erik: Moving to slide 18, our Capex forecast for 25 is heavily impacted by the dry dock and maintenance periods on our vessels the seawell Q seven.

Erik: Continuing our shallow water abandonment segment had a strong third quarter before being impacted by the normal seasonal slowdown during the fourth quarter, we expect the offshore marine business to maintain good utilization on 5% to seven lift boats with some variable seasonality on the OSV and crew boats the energy services should have.

Erik: 5000 completed their dry docks in the first half of 2025 Q4 thousand is now planned to enter Drydock in the third quarter with forecasted completion at the end of August.

Erik: We are increasing our capex range for 2025% to $70 million to $80 million to account for the acceleration of the Q4 thousand docking into 2025. The majority of our Capex forecast continues to be maintenance and project related related which primarily falls into operating cash flows.

Erik: Seasonal utilization for up to 10, PNA spreads to two coiled tubing units and 25.

Erik: There is seasonality in the diving in heavy lift business, where the <unk> and diving vessels are expected to have good utilization during Q3, but slowdown during Q4.

Erik: Reviewing our balance sheet, our funded debt of $319 million at June 30, and is expected to decrease further by $4 million in 2025 with scheduled principal payments on our merit that we repurchase of.

Erik: Moving to slide 18, our Capex forecast for 25 is heavily impacted by the dry dock and maintenance periods on our vessels the seawell Q seven two.

Erik: 5000 completed their dry docks in the first half of 2025. The Q4 thousand is now planned to enter Drydock in the third quarter with forecasted completion at the end of August.

Erik: Our shares $30 million worth of our shares during the second quarter.

Owen: At this time I will turn the call back to Owen for a discussion on our current outlook for 'twenty five and beyond that for closing comments.

Speaker Change: Thank you Eric.

Speaker Change: I've never been one to gloss over the challenges, we're facing or have faced in the past.

Speaker Change: And what we've told our grocers.

Speaker Change: Last year going into the year from higher rates and major contract awards. It was easy to think we run a sustainable up cycle.

Erik: Reviewing our balance sheet, our funded debt of $319 million at June 30 is expected to decrease further by $4 million in 2025 with scheduled principal payments on our merit that we repurchase of our shares $30 million worth of our shares during the second quarter.

Speaker Change: Many companies, including <unk> are disappointed in the 2025 market, while the long term fundamentals are solid and cash flow outlook is still strong the market is more nuanced than the expectations for consumer viewing improvements would suggest.

Erik: At this time I will turn the call back to Owen for a discussion on our current outlook for 'twenty five and beyond that for closing comments.

Speaker Change: The markets for 2025 can best be described as impacted by uncertainty in decision on the part of the producers.

Owen: Thanks, Eric.

Speaker Change: We have three primary markets that have disappointed and negatively impacted our expected results.

Owen: I've never been one to gloss over the challenges, we're facing or have faced in the past and what we tell investors.

Speaker Change: <unk>.

Speaker Change: You might notice.

Owen: Last year going into the year from higher rates and major contract awards. It was easy to think we run a sustainable up cycle.

Speaker Change: These are areas, where we're most exposed to the spot market nature of the market.

Owen: Many companies, including <unk> are disappointed in the 2025 market, while the long term fundamentals are solid and cash flow outlook is still strong the market is more nuanced than the expectations for consumer viewing improvements would suggest.

Speaker Change: First the U K North sea market has come to a temporary standstill coming into the year to some degree. We expected. This is the result of government policy uncertainty continuation of the excess profit tax and merger activity with resulting integration periods as producers with profitable outlooks.

Owen: The market for 2025 can best be described as impacted by uncertainty in decision on the part of the producers. We have three primary markets that have disappointed and negatively impacted our expected results.

Speaker Change: Merge with producers.

Speaker Change: Net loss tax positions, but I'm not sure anyone anticipated the true weakness of the market. This year. We noted several major producers have announced their intention to lead the U K North Sea. This should generate meaningful levels of abandonment work with most of it being forecasted to occur starting in 2027.

Owen: Sure.

Owen: You might notice in this.

Owen: These are areas, where we're most exposed to the spot market nature of the market.

Speaker Change: At this time planning and engineering is occurring we do see at least two significant larger projects for 2026, but the competition for them is expected to be.

Owen: First the U K North sea market has come to a temporary standstill coming into the year to some degree we expected. This as a result of government policy uncertainty continuation of the excess profit tax of merger activity with resulting integration periods as producers with profitable outlooks merge.

Speaker Change: Affecting potential margins.

Speaker Change: Our expectations for 2025 remained low with improvement in 2026 and recovery by 2027.

Owen: With producers.

Owen: Net loss tax positions, but I'm not sure anyone anticipated the true weakness of this market this year.

Speaker Change: In the Gulf of America intervention market. The intervention market is also looking soft for the second half of the year. The Q 5000 backlog looks solid.

Owen: Several major producers have announced their intention to lead the U K North sea. This should generate meaningful levels of abandonment work with most of it being forecasted to occur starting in 2027.

Speaker Change: Depending on demand the Q4 may be able to find more consistent opportunities deploy adults where to position for this flexibility we are bringing the regulatory drydocking forward into 2025.

Owen: At this time planning and engineering is occurring we do see at least two significant larger projects for 2026, but the competition for them is expected to be stiff.

Speaker Change: This will have ramifications in 2025.

Speaker Change: That's up for more available days in 2026 and flexibility on regional deployment.

Owen: <unk> potential margins.

Owen: Our expectations for 2025 remained low with improvement in 2026 and recovery by 2027.

Speaker Change: Third area.

Speaker Change: You mentioned is the shallow water abandonment.

Speaker Change: There continues to be a significant backlog of regulatory required abandonment work in the Gulf of America shelf.

Owen: In the Gulf of America intervention market. The intervention market is also looking soft for the second half of the year. The Q 5000 backlog looks solid.

Speaker Change: Random orders are being given out but 2025, it's proven to be a year planning engineering and permitting.

Owen: Depending on demand the Q4 may be able to find more consistent opportunities deploy adults where to position for this flexibility we are bringing the regulatory drydocking forward into 2025.

Speaker Change: As a result of volume demand has been low with competitive pressure crushers depressing margins and increasing labor costs as our contractors struggled to find skilled people.

Speaker Change: We believe we've right sized the business for 2025, but lower margins and higher labor costs will result in the second year of less than satisfactory results. We expect 2026 to improve with the further improvement in 2027.

Owen: This will have ramifications in 2025.

Owen: That's up for more available days in 2026 and flexibility on regional deployment.

Owen: Third area.

Owen: You mentioned is the shallow water abandonment they're.

Owen: There continues to be a significant backlog of regulatory required abandonment work in the Gulf of America shelf. The abandonment orders are being given out but 2025 has proven to be a year planning engineering and permitting.

Speaker Change: Elsewhere helix is operating as expected with a strong <unk> market in Brazil for intervention in the offshore wind trenching and <unk> clearance market demand remaining strong globally. Despite the challenges of the U S wind farm market.

Owen: As a result of the volume demand has been low with competitive pressures depressing margins and increasing labor cost as.

Speaker Change: And production facilities are Droshky field continues to produce well beyond the original expected into production.

Owen: As our contractors struggled to find skilled people.

Speaker Change: Thunder Hawk field remains shut in while planning and long lead items are prepared for an intervention at this time, we are planning for production to be restored in early 2026.

Owen: We believe we have right sized the business for 2025, but lower margins and higher labor costs will result in the second Europe less than satisfactory results. We expect 2026 to improve with the further improvement in 2027.

Speaker Change: Again, I've never been one to shy away from the challenges, we face and whether it's good or bad we are open with our shareholders. There is no doubt that 2025 has not gone as well as we've expected, but the overarching themes.

Owen: Elsewhere helix is operating as expected with a strong <unk> market in Brazil for intervention and the offshore wind trenching and site clearance market demand remaining strong globally. Despite the challenges of the U S wind farm market.

Speaker Change: Macro instability and market uncertainty lower oil prices and resulting lower cash flows.

Speaker Change: The customers are facing their own challenges and it's pushing out that spend and impacting our business.

Owen: And production facilities are Droshky field continues to produce well beyond the original expected into production.

Speaker Change: In spite of these expected hiccups for 2025 helix remains financially very strong even in this down market. We're anticipating free cash flow generation that is likely greater than $100 million with a strong balance sheet and good long term backlog.

Owen: Under our field remains shut in while planning and long lead items are prepared for an intervention at this time, we are planning for production to be restored in early 2026.

Speaker Change: Signs of renewed activity in the North sea well intervention market, we still have expectations for a meaningful improvement in 2026, and a return to full strength our results by 2027.

Speaker Change: Macro instability and market uncertainty lower oil prices and resulting lower cash flows.

Speaker Change: So thanks.

Speaker Change: Thanks, Eric and thank everybody for joining us today.

Speaker Change: The customers are facing their own challenges and it's pushing out their spend and impacting our business.

Speaker Change: Very much appreciate your interest and participation and look forward to having you on our third quarter 25 call in October.

Speaker Change: In spite of these expected hiccups for 2025 helix remains financially very strong even in this down market. We are anticipating free cash flow generation that is likely greater than a $100 million with a strong balance sheet and good long term backlog.

Speaker Change: Operator at this time, we'll go ahead and take any questions.

Speaker Change: At this time I would like to remind everyone that in order to ask a question. Please press Star then the number one on your telephone keypad.

Speaker Change: We will just pause for just a moment to compile the Q&A.

Speaker Change: Okay. So your first question comes from the line of Greg Lewis with <unk>. Please go ahead.

Greg Lewis: Yeah, Hey, Thank you and good morning, and thanks for taking my questions everybody.

Greg Lewis: I appreciate the comments and clearly as we look at our shallow water band of mid <unk> kind of been.

Speaker Change: Thanks, Sir.

Speaker Change: Thanks, Eric and thank everybody for joining us today.

Speaker Change: Very much appreciate your interest and participation and look forward to having you on our third quarter 25 call in October.

Greg Lewis: It's kind of just been there maybe not as good.

Greg Lewis: Kind of hanging in there.

Speaker Change: Yes My question is.

Speaker Change: So operator at this time, we'll go ahead and take any questions.

Greg Lewis: As you think about that market.

Greg Lewis: Theres always this given take around while Theres, a lot of wells that need to be plugged and abandoned.

Speaker Change: At this time I would like to remind everyone that in order to ask a question. Please press Star then the number one on your telephone keypad.

Greg Lewis: The regulatory backdrop around that and then of course, the oil price also seems to matter as.

Speaker Change: We will just pause for just a moment to compile the Q&A roster.

Speaker Change: Okay. So your first question comes from the line of Greg Lewis with <unk>. Please go ahead.

Greg Lewis: You kind of think about.

Greg Lewis: What we should be looking at for potential signs of shallow water.

Greg Lewis: And that <unk>.

Greg Lewis: Yeah, Hey, Thank you and good morning, and thanks for taking my questions everybody.

Greg Lewis: What do you think we should be focused on just thinking that it looks like we might be finding a bottom here.

Speaker Change: Appreciate the comments and clearly as we look at our shallow water band of mid <unk> kind of been.

Greg Lewis: I think we are at a bottom right now.

Greg Lewis: Yes.

Greg Lewis: Having just been there maybe not as good.

Greg Lewis: Window when the field within the Cox of bankruptcies occurred I think it became apparent to the.

Greg Lewis: It kind of hanging in there.

Greg Lewis: I guess my question is.

Greg Lewis: As you think about that market.

Greg Lewis: Industry is that the model would sort of broken and this is the first time, we've seen massive boomerang properties going back to the majors.

Greg Lewis: Theres always this given take around while Theres, a lot of wells that need to be plug and abandoned.

Greg Lewis: That's been.

Greg Lewis: The regulatory backdrop around that and then of course the oil price also seems to matter as you kind of think about what we should be looking at for potential signs of shallow water.

Greg Lewis: A relatively new thing.

Greg Lewis: For the government and the producers to deal with and I think what Youre seeing right now is a little in decision on the part of both the government basically came out.

Greg Lewis: In that <unk>.

Greg Lewis: Like what do you think we should be focused on just thinking that it looks like we might be finding a bottom here.

Greg Lewis: The producers a three year period to come up with a plan. Some producers are going ahead and getting ahead of that curve.

Greg Lewis: I think we are at a bottom right now.

Greg Lewis: When that happens and the Cogs bankruptcy was delayed that basically means that right now all the producers are sort of trying to figure out what are they going to do what are their plans and then doing the engineering and permitting all takes time.

Greg Lewis: Window, when the field word into Cogs.

Greg Lewis: Bankruptcies occurred I think it became apparent to the.

Greg Lewis: Our industry is that there is.

Greg Lewis: The model with sort of brokerage and then this is the first time, we've seen massive boomerang properties going back to the majors.

Greg Lewis: I think by 2027 period expires.

Greg Lewis: So what I would look at.

Greg Lewis: That's been.

Greg Lewis: The bidding activity between now and 'twenty seven are you going to see producers getting ahead of the curve in coming out with major bids.

Greg Lewis: A relatively new thing.

Greg Lewis: <unk> for the government and the producers to deal with and I think what Youre seeing right now is a little in decision on the part of both the government basically came out and allowed to producers of three year period to come up with a plan. Some producers are going ahead and getting ahead of that curve.

Greg Lewis: We just announced that we won a major contract with Exxon in three years.

Greg Lewis: 195 wells or thereabouts.

Greg Lewis: So that was a major bids that came out.

Greg Lewis: When that happens and the Cogs bankruptcy was delays that basically means that right now all the producers are sort of trying to figure out what are they going to do what are their plans and then doing the engineering and permitting all takes time.

Greg Lewis: I think youll see follow on business coming out.

Greg Lewis: I would watch the bid activity over the next 12 months to judge as to when the market returns to normalcy.

Greg Lewis: Okay, Great and then just on the well intervention in the Gulf of Mexico, and the Gulf of America.

Greg Lewis: I think by 2027 years of that period expires.

Greg Lewis: What I would look at.

Greg Lewis: Yes.

Greg Lewis: The bidding activity between now and 2007.

Greg Lewis: When we think about that with the Q five and the Q4 clearly the Q five is good for the remainder of 2025% and I know, we don't necessarily comment on pricing.

Greg Lewis: Are you going to see producers getting ahead of the curve in coming out with major bids I think we just announced that we won a major contract with Exxon in three years.

Greg Lewis: But maybe could you talk a little bit about.

Greg Lewis: Maybe the difference in.

Greg Lewis: 195 wells or thereabouts.

Greg Lewis: And how we should think about if we are able to secure like multi quarter where versus spot work and I'm kind of curious on your view.

Greg Lewis: That was a major bids that came out.

Speaker Change: Thank you will see follow on bids coming out so.

Greg Lewis: One of the Globetrotter rigs that had previously kind of competed in well intervention is believing the golf right. It's heading over to I believe the black sea.

Speaker Change: So I would watch the bid activity over the next 12 months to judge as to when the market returns to normalcy.

Speaker Change: Okay, Great and then just on the well intervention in the Gulf of Mexico, and the Gulf of America.

Greg Lewis: So just kind of curious how that positions you are assets in the Gulf of America, just sometimes things benefit from a little less competition.

Speaker Change: Yes.

Speaker Change: When we think about that with the Q five and the Q4 clearly the keynote <unk> <unk> good for the remainder of 2025, but and I know, we don't necessarily comment on pricing.

Greg Lewis: That's true I.

Greg Lewis: I don't really see the competition is being the hurdle for us that's not the challenge for us. So I think we're very competitive.

Speaker Change: Maybe could you talk a little bit about <unk>.

Speaker Change: Maybe the difference.

Greg Lewis: Our efficiency to now compete rigs so I don't see that as the issue.

Speaker Change: How we should think about if we're able to secure like multi quarter where versus spot work and I'm kind of curious on your view.

Greg Lewis: I think what happened this year as we were anticipating a little bit of a softness which is why we took.

Speaker Change: I know one of the globetrotter rigs that had previously kind of competed in well intervention is believing the golf right, it's heading over to Billy.

Greg Lewis: And Nigeria with Q4.

Greg Lewis: That work Unfortunately.

Greg Lewis: And there's a little bit short.

Speaker Change: Believes the black sea.

Greg Lewis: Because a couple of the wells that they were planning to do got eliminated from the scheduled by the clients in the bulk of our time in West Africa short, which was not a major issue because we were looking at.

Speaker Change: So just kind of curious how that positions you know your assets in the Gulf of America.

Speaker Change: Sometimes things benefit from a little less competition.

Speaker Change: That's true.

Greg Lewis: And in discussions with a lot of clients about work that the originally at the beginning of the year. They had planned to do for the second half of the year one by the time, we got back to the Gulf, though most of these producers decided not to spend the money and the work all pushed out into 2026, which has left us with a.

Speaker Change: I don't really see the competition as being the hurdle for us that's not the challenge for us. So I think we're very competitive.

Speaker Change: Our efficiency to now compete rigs I don't see that as the issue.

Speaker Change: I think what happened this year as we were anticipating a little bit of a softness which is why we took.

Greg Lewis: Gaping hole in the second half of the year for the Q4.

Speaker Change: Work in Nigeria with Q4.

Greg Lewis: Which was unanticipated and it wasn't even visible until we got back here. So we're scrambling right now I wouldn't say that.

Speaker Change: That work on Fortunately.

Speaker Change: We ended a little bit short because a couple of the wells that they were planning to do got eliminated from the scheduled by the client to invest cut our time in West Africa short, which was not a major issue because we were looking at.

Greg Lewis: The fate of complete.

Greg Lewis: But we did decide that we would move the dry docking forward into this year. So that we would have the vessel fully available for what we would expect.

Speaker Change: And in discussions with a lot of clients about work that originally at the beginning of the year. They had planned to do for the second half of the year one by the time, we got back to the Gulf, though most of these producers decided not to spend the money and the work all pushed out into 2026, which has left us with a.

Greg Lewis: An increase in demand for 2026, so we'd have more available days and Scott you may have.

Scott: A little more insight, yes, I think we should add that the key 5000 is very well contracted at good rates for the remainder of 2025 and has a good backlog going into 2026 with shell and options with other clients plus options into 2027 key five thousands in very good shape.

Speaker Change: Gaping hole in the second half of the year for the Q4.

Speaker Change: Which was unanticipated and it wasn't even visible until we got back here. So we are scrambling right now I wouldn't say that.

Scott: Q4, one of the reasons, we may receive regulatory Dunkin' forward into 2025 is we're also looking at works at with Gulf of Mexico again.

Speaker Change: The complete.

Speaker Change: But we did decide we would move the dry docking forward into this year. So that we would have for vessel fully available for what we would expect.

Scott: Southern America back in Africa, whereas we wouldn't be able to undertake the regulatory plan and Dunkin' for that asset.

Speaker Change: An increase in demand for 2026, so we'd have more available days and Scott you may have a little more insight, yes, I think we should add that the key 5000 is very well contracted at good rates for the remainder of 2025 and has a good backlog going into 2026 with shell and options with other clients plus options into.

Scott: And we're seeing it go from $25 to $26 has some good discussions with clients for key five thousands that can get and international opportunities are in discussion for the Q4 thousand again.

Scott: Add a little bit more because if youre looking for a bridge from last year to this year and what happened.

Scott: I think as I mentioned earlier, you don't need to look further than the exposure to the spot market, which which segments of ours are exposed mostly to the spot market.

Speaker Change: <unk> 2027, <unk> 5000.

Speaker Change: Hey, good shape at good rates to Q4, one of the reasons, we've may receive regulatory duck and forward into 2025 is we're also looking at works.

Scott: The areas that we are having that exposure.

Speaker Change: With the Gulf of Mexico, again, as SaaS Southern America back in Africa, whereas we wouldn't be able to undertake the regulatory plan and Dunkin' for that asset.

Scott: The well ops UK.

Scott: The shallow water.

Scott: In a month.

Speaker Change: Fourth quarter here for the Gulf of America for the Q4 thousand those are the three areas where we.

Speaker Change: We're seeing a lot of work go from 25% into 2006 with some good discussions with clients for key five thousands that can get and international opportunities are in discussion for the Q4 thousand again.

Scott: It's typically a spot market.

Speaker Change: Not a matter of the competition or the rigs.

Speaker Change: I'll, just add a little bit more because if youre looking toward.

Speaker Change: White space or anything else, it's simply a matter that the clients.

Speaker Change: Bridge from last year to this year and what happened.

Speaker Change: We can suffer a slowdown in one area maybe too.

Speaker Change: I think as I mentioned earlier.

Speaker Change: You don't need to look further than the exposure to the spot market, which which segments of ours are exposed mostly to the spot market.

Speaker Change: But when all three areas slow down in the same year. The result of the impact that you are seeing on our results for this year.

Speaker Change: Okay Super helpful. Thanks for the color.

Speaker Change: The areas that we are hedging that exposure.

Speaker Change: Okay.

Speaker Change: The well ops UK.

Speaker Change: Your next question comes from the line of Chi Chow with TD Cowen. Please go ahead.

Speaker Change: <unk> water.

Speaker Change: Abandonment.

Speaker Change: The fourth quarter here for the Gulf of America for the Q4 thousand.

Chi Chow: Hey, good morning, guys.

Speaker Change: Those are the three areas where it's.

Speaker Change: Good morning, Jim maybe maybe just starting and robotics, if I look at the.

Speaker Change: It's typically a spot market.

Speaker Change: Not a matter of the competition are the rigs of white space or anything else, it's simply a matter that the clients.

Speaker Change: Subsea robotics revenue this quarter year over year revenues are up a little bit, but EBIT was way down.

Speaker Change: We can suffer a slowdown one area maybe too.

Speaker Change: So what's what's driving that is that.

Speaker Change: But when all three areas slow down in the same year that results of the impact that you are seeing on our results for this year.

Speaker Change: I see some lower integrated trenching work.

Speaker Change: Is that it or is there something else.

Speaker Change: Okay Super helpful. Thanks for the color.

Speaker Change: The main reason for that is that last year, we had the $2 40 to 101 and the vessel on a full package operation in Taiwan. This year decline is provided in the vessels and decided I say, we just have the trencher.

Speaker Change: Yes.

Speaker Change: Your next question comes from the line is Chi Tsang with JD Com. Please go ahead.

Speaker Change: Contracted declines in Taiwan.

Chi Tsang: Hey, good morning, guys.

Speaker Change: There's quite a big difference I think year over year results in about $10 million worth of difference of not providing the full trenching spread and just providing the trencher.

Speaker Change: Good morning, Jim maybe maybe just starting and robotics, if I look at the <unk>.

Speaker Change: Subsea robotics revenue this quarter year over year revenues are up a little bit, but EBIT was way down.

Speaker Change: So I think Jim Yeah, I think there is a little bit of a margin difference in our in our contract makeup I think we have a bit more vessel days as our contracts are primarily.

Speaker Change: So what's what's driving that is that.

Speaker Change: I see some lower integrated trenching work.

Speaker Change: Day rate contracts last year, we had some lump sum contracts that were completed at the end of the second quarter at very good margins and so I think that's where you see probably an increase in cost is higher asset activity sort of speak on day rates as opposed to some of the lump sum benefit from last year.

Speaker Change: Is that it or is there something else.

Speaker Change: The main reason for that is that last year, we had the $2 40 to 101 and the vessel and a full package operating in Taiwan. This year decline is provided in the vessels and decided I say, we just have the trencher.

Speaker Change: Contract to declines in Taiwan.

Speaker Change: Okay. Thank you.

Speaker Change: There is quite a big difference I think year over year results in about $10 million worth of difference not providing the full trenching spread and just providing the trencher.

Speaker Change: And then on the shallow water.

Speaker Change: You said, you've right sized the business, but it is Q2, it's a seasonally strong quarter typically in your EBIT neutral.

Speaker Change: So I think Jimmy I think there is a little bit of a margin difference in our in our contract makeup I think we have a bit more vessel days as our contracts are primarily.

Speaker Change: No.

Speaker Change: What's the.

Speaker Change: I would think that maybe you would want to go after more cost cuts here, but but you said youre right sized so.

Speaker Change: How should we.

Speaker Change: How are you thinking about that.

Speaker Change: So I think.

Speaker Change: The second quarter in shallow water was was a bit disappointing I think the biggest driver from our standpoint is was the later start on our heavy lift.

Speaker Change: Okay. Thank you.

Speaker Change: That is.

Speaker Change: Yes.

Speaker Change: Isn't that it's usually between 115 to 180 days, we had expected to be able to start in early may and due to weather.

Speaker Change: And then on the shallow water.

Speaker Change: You said, you've right sized the business, but it is Q2, it's a seasonally strong quarter typically in your view or EBIT neutral.

Speaker Change: Weather patterns in the Gulf, we Werent able to I think mobilize that asset until.

Speaker Change: So I mean, what's the.

Speaker Change: I would think that maybe you would want to go after more cost cuts here, but but you said youre right sized so.

Speaker Change: You could say middle of June and so I think that had a significant impact on our expectations. There obviously increase the cost ready to mobilize asset and were hampered by by the wet weather patterns. There. So that was a big driver of that I think Owen you can speak to perhaps the P&A side of.

Speaker Change: How should we.

Speaker Change: How are you thinking about that.

Speaker Change: So I think no.

Speaker Change: The second quarter in shallow water was was a bit disappointing I think the biggest driver from our standpoint.

Speaker Change: Is was the later start on our heavy lift that is.

Speaker Change: Side of things, but that was a big driver of some of the I guess.

Speaker Change: And that's usually between 115 to 180 days, we had expected to be able to start in early may and due to weather.

Speaker Change: Poor performance in the second quarter.

Speaker Change: I think in addition, we're seeing dollars pressure on rates.

Speaker Change: Rates in the near term the marketed utilization at the moment is fairly low.

Speaker Change: Weather patterns in the Gulf, we weren't able to I think mobilize that asset until the.

Speaker Change: Larger boats or having to compete with the smaller.

Speaker Change: Say middle of June and so I think that had a significant impact on our expectations. There obviously increased the cost ready to mobilize asset and were hampered by by the wet weather patterns. There. So that was a big driver of that I think Owen you can speak to perhaps the P&A side of.

Speaker Change: The lower rate in the marketplace, so that coupled with the Houston late start as really led to the lower than expected Q2 results, but we do expect improvement on a go forward basis.

Speaker Change: I think very telling and as Owen mentioned previously is the bid activity.

Speaker Change: The recent three year Exxon framework agreements on a go forward basis, we expect that to provide roughly.

Speaker Change: Side of things, but that was a big driver of some of the I guess.

Speaker Change: Poor performance in the second quarter.

Speaker Change: Days of overall utilization in the P&A spreads over that three year period with pull through for other assets. So we do want to ensure that we can meet demand on a go forward basis as well.

Speaker Change: I think in addition, we're seeing pressure on rates.

Speaker Change: Rates in the near term the marketed utilization at the moment is fairly low so our larger birds are having to compete with the smaller.

Speaker Change: Just an overview, we did rightsize the business with roughly $15 million worth of cost out of the business.

Speaker Change: Demand at a lower rate in the marketplace. So that coupled with the Houston late start as really led to the lower than expected Q2 results, but we do expect improvement on a go forward basis, I think very telling us and as we've mentioned previously is the bid activity.

Speaker Change: But we had to maintain sufficient personnel and equipment on the ready to be able to deal with the peak of the market.

Speaker Change: The problem is with the dearth of work out there all of the competitors are seeking utilization.

Speaker Change: The recent three year.

Speaker Change: Exxon framework agreements on a go forward basis, we expect that to provide roughly 1000 days of overall utilization in the PNA spreads over that three year period with pull through for other assets. So we do want to ensure that we can meet demand on a go forward basis as well.

Speaker Change: Competitive rates have been reduced greatly margins had been reduced greatly and in order to.

Speaker Change: Provides about utilization there has been a real competition on personnel.

Speaker Change: When we rightsize the business we did load people go we have stacked five vessels that started sort of a mix of people.

Speaker Change: Just an overview, we did rightsize the business with roughly $15 million worth of cost out of the business.

Speaker Change: Due to the competitive pressures.

Speaker Change: But we had to maintain sufficient personnel and equipment on the ready to be able to deal with the peak of the market.

Speaker Change: Been responded by increasing our labor cost.

Speaker Change: That sort of gives you.

Speaker Change: Picture of we did cut costs had to add back and we're carrying <unk>.

Speaker Change: The problem is with the dearth of work out there all of the competitors are seeking utilization. So the competitive rates have been reduced greatly margins have been reduced greatly and in order to.

Speaker Change: <unk> capacity to meet the peak demand during the middle of the season, so that we can maintain market share.

Speaker Change: Understood. Thank you and then.

Speaker Change: Hmm.

Speaker Change: <unk> provides about utilization there has been a real competition on personnel.

Speaker Change: What about the so I understand the rationale for the Q4 thousand accelerating the regulatory maintenance here.

Speaker Change: When we rightsize the business, we did love people go we have stacked five vessels and that started sort of an exodus of people.

Speaker Change: Why not.

Speaker Change: Why not remediate the Thunder Hawk well.

Speaker Change: Well this year, while you have this downtime like why why wait till early 2026, one potentially you could be doing customer work at that time.

Speaker Change: And due to the competitive pressures, we we've been responded by increasing our labor cost.

Speaker Change: That sort of gives you.

Speaker Change: Picture of we did cut costs had to add back and we're carrying <unk>.

Speaker Change: Moving forward.

Speaker Change: Due to the intervention on the Thunder Hawk grow first of all it took a lot of time to try and diagnose what was going on.

Speaker Change: <unk> capacity to meet the peak demand during the middle of the season, so that we can maintain the market share.

Speaker Change: And then we work with partners.

Understood. Thank you and then.

Speaker Change: So in order to bring them along one of the potentials.

Speaker Change: What about the I understand the rationale for the Q4 thousand and accelerating the regulatory maintenance here.

Speaker Change: Downhole safety valves could be called.

Speaker Change: Among other things but.

Speaker Change: Why not.

Speaker Change: That requires a long lead order times in order to have them.

Speaker Change: Why not remediate the Thunder Hawk well.

Speaker Change: Insert valve manufacturer and to make sure that we had the right <unk> in place to be able to carry that out beyond that.

Speaker Change: Well this year, while you have this downtime like why why wait till early 2026, one potentially you could be doing customer work at that time.

Speaker Change: <unk>.

Speaker Change: Are there different methodologies for clearing.

Speaker Change: So why not move that forward.

Speaker Change: To do the intervention run the Thunder Hawk grow first of all it took a lot of time to try and diagnose what was going on.

Speaker Change: The blockage in the partners.

Speaker Change: Both partners.

Speaker Change: Are strongly in favor exhausting all possibilities prior to doing an intervention.

Speaker Change: And then we work with partners.

Speaker Change: So in order to bring them along one of the potentials of those downhole safety valves could be.

Speaker Change: I don't know until you have.

Speaker Change: A little more clarity on that.

Speaker Change: Thats accurate, we're expecting the delivery of long lead items towards the back end of Q3 going into the beginning of Q4.

Speaker Change: Among other things but.

Speaker Change: That requires a long lead order times in order to have them.

Speaker Change: Also the partners.

Speaker Change: Insert valve manufacturer and to make sure that we had the right <unk> in place to be able to carry that out beyond that the partners.

Speaker Change: Preference for the intervention to carrier carried out.

Speaker Change: At a slightly later days earlier.

Speaker Change: Earlier in Q1 of 2026 is also their progress.

Speaker Change: Okay, great. Thank you I'll get back in queue.

Speaker Change: Are there different methodologies for clearing.

Speaker Change: The blockage in the partners.

Speaker Change: Your next question comes from the line.

Speaker Change: <unk> partners.

Speaker Change: Listen with Raymond James Please go ahead.

Speaker Change: You are strongly in favor exhausting all possibilities prior to doing an intervention.

Speaker Change: Hey, good morning, guys.

Speaker Change: Owen you kind of covered this a little bit, but maybe just to dive in a little bit more on an intervention.

Speaker Change: Daniel.

Daniel: A little more clarity on that I think thats accurate, we're expecting the delivery of long lead items towards the back end of Q3 going into the beginning of Q4.

Speaker Change: And the decisions from some of your customers to push work just curious when you have these conversations.

Daniel: So the partners.

Speaker Change: What's the main.

Speaker Change: Our preference for the intervention to carrier carried out.

Speaker Change: Challenges that they are looking at thats kind of driven incremental.

Speaker Change: At a slightly later dates so early earlier Q1 of 2026 is also better profits.

Speaker Change: Pushes from 90 days ago to now is it the tariff uncertainty is it the oil price and just kind of curious as we set up for what you are kind of describing as a baby better 2006 and heading into an even better 2007.

Speaker Change: Okay, great. Thank you I'll get back in queue.

Speaker Change: Your next question comes from the line of gene.

Gene Rollyson: Rollyson with Raymond James Please go ahead.

Speaker Change: Just so we understand the drivers better. So you can kind of think about how realistic those timeframes are when that work comes back if that makes sense.

Gene Rollyson: Hey, good morning, guys.

Speaker Change: Owen you kind of covered this a little bit, but maybe just to dive in a little bit more on an intervention.

Speaker Change: I think it's a matter of all of the above.

Speaker Change: And the decisions from some of your customers to push work just curious when you have these conversations.

Speaker Change: Thank you have a weaker oil prices you have the regulatory uncertainty in the fiscal regime in the North Sea.

Speaker Change: What's the main.

Speaker Change: Challenges that they are looking at that as kind of driven incremental.

Speaker Change: Yes.

Speaker Change: It's just a plethora of reasons.

Speaker Change: Pushes from 90 days ago to now is it the tariff uncertainty is it the oil price and just kind of curious as we've set up for what you are kind of describing as a baby better 2006 and heading into an even better 2007.

Speaker Change: What happens is that the producers basically because of all the uncertainty just besides the third going to sit on the sidelines right now.

Speaker Change: Everything just gets pushed to the right now how far it gets pushed to the right. That's the question that we're trying to figure out probably the industry as well.

Speaker Change: Maybe just so we understand the drivers better. So you can kind of think about how realistic those timeframes are when that work comes back if that makes sense.

Speaker Change: I've seen some people coming out saying second half of 2006, we think it's going to be more it's not a light switch that turns on at some point in time I think what we're expecting is that.

Speaker Change: I think it's a matter of all of the above.

Speaker Change: Thank you have a weaker oil prices you have the regulatory uncertainty in the fiscal regime in the North Sea.

Speaker Change: Some of the activity can't be pushed out to the right forever and some of some of the producers are going to get back into the game a little early so that's why we're seeing a gradual ramp up during 2026.

Speaker Change: <unk>.

Speaker Change: Yes.

Speaker Change: It's just a plethora of reasons.

Speaker Change: What happens is that the producers basically because of all the uncertainty just decided the third going to sit on the sidelines right now.

Speaker Change: Who knows but I'm, hoping that a lot of the uncertainty or the pent up demand.

Speaker Change: Everything just gets pushed to the right now how far it gets pushed to the right. That's the question that we're trying to figure out probably the industry as well.

Speaker Change: Allows us to get back to a more normalized market by 2027, we're certainly seeing the green shoots.

Speaker Change: For instance, the U K.

Speaker Change: Our producer and even the producers what flows are going to get out.

Speaker Change: On the call.

Speaker Change: Loss on wind.

Speaker Change: <unk>.

Speaker Change: And everything that I've seen right now would indicate that that's going to become pretty heavy between 20 730 31.

Speaker Change: Some of the activity can't be pushed out to the right forever and some of the some of the producers are going to get back into the game a little early so that's why we're seeing a gradual ramp up during 2026.

Speaker Change: Got it that's helpful.

Speaker Change: We're in discussion with some large tenders in the north sea that would take us back hopefully in 'twenty six investment market and the feedback from the customers in the Gulf of Mexico. They have seen two sizable drops in oil price and then just patient decommissioning work out into 2026.

Speaker Change: Who knows but I'm, hoping that a lot of the uncertainty or the pent up demand.

Speaker Change: It allows us to get back to a more normalized market by 2027, we're certainly seeing the green shoots in for instance, the U K.

Speaker Change: Thanks, Thanks for that O&M Scotty.

Speaker Change: We're producing even the producers what flows are going to get out.

Speaker Change: Asking because obviously the tariff uncertainty is probably more clarified the U K, who knows and there is a lot of speculation in oil prices may get worse before they get better so that was kind of the context of the question.

Speaker Change: Trips the clock on.

Speaker Change: When they do that.

Speaker Change: And everything that I've seen right now would indicate that that's going to become pretty heavy about between 20 730 31.

Speaker Change: When you look at <unk> specifically.

Speaker Change: When you think about the guidance adjustment lower is most of that reduction coming in <unk> like you mentioned <unk> being your best quarter seasonally stronger et cetera, but I'm just kind of curious as we think about the magnitude of improvement in <unk> versus maybe what we were expecting 90 days ago.

Speaker Change: Got it Thats helpful.

Speaker Change: We're in discussion with some large tenders in the north sea that would take us back hopefully in 2006 to two vessel market and the feedback from the customers in the Gulf of Mexico. They have seen two sizable drops in oil price and then just patient decommissioning work out into 2026.

Speaker Change: Yes, I think.

Speaker Change: Thinking about it from a perspective of impacting our fourth quarter is the right way to visualize it we do have a very strong contracted backlog.

Speaker Change: Thanks, Thanks for that O&M Scotty.

Speaker Change: Asking because obviously the tariff uncertainty is probably more clarify the U K, who knows and there is a lot of speculation in oil prices may get worse before they get better so that was kind of the context of the question.

Speaker Change: Probably have a little bit of weakness in the on the Q4 thousand towards the end of the quarter.

Speaker Change: When you look at <unk> specifically.

Speaker Change: But the driver of you could say our adjustment to guidance and the uncertainty that we see is really in the fourth quarter. It's always a challenge with the normal seasonal downturn, how quickly operators are going to shutdown activity, but then of course on top of that is the <unk>.

Speaker Change: Our reluctance to spend and the impact that that's having on our well intervention market in the Gulf of Mexico. So it is concentrated in the fourth quarter.

Speaker Change: Yes, I think.

Speaker Change: Thinking about it from a perspective of impacting our fourth quarter is the right way to visualize it we do have a very strong <unk>.

Speaker Change: Got it and Eric just one last thing on the free cash flow. Obviously, you mentioned second half ramp versus first half it looks like Dsos ticked up a decent amount this quarter, maybe just a little color on kind of what's going on there and I presume unwinding. Some of that is part of what helps drive our second half improved.

Speaker Change: Contracted backlog.

Speaker Change: Probably have a little bit of weakness in the on the Q4 thousand towards the end of the quarter.

Speaker Change: Improvement.

Speaker Change: Yes, I think we are at.

Speaker Change: DSO did jump up quite a bit here in the second quarter I think we have a couple of larger blue chip customers that are pushing out payments.

Speaker Change: In making that a little bit challenging, but I think that's something that we'll be able to address obviously before the end of the year.

Speaker Change: General reluctance to spend and the impact that that's having on our well intervention market in the Gulf of Mexico. So it is concentrated in the fourth quarter.

Speaker Change: Got it thank you guys.

David Smith: Your next question comes from the line of David Smith with <unk> Securities. Please go ahead.

Speaker Change: Yeah.

David Smith: Hey, good morning, and I apologize in advance.

David Smith: My questions have been touched on it's been a busy morning and RFS land.

David Smith: And I understand there can be quarter to quarter.

Speaker Change: Improvement.

Speaker Change: Yes, I think we are at.

Speaker Change: So did jump up quite a bit here in the second quarter I think we have a couple of larger blue chip customers that are pushing out payments.

David Smith: Volatility in well intervention, alright, things like contract transitions regulatory downtime accounting for mobilization.

David Smith: I'm just struggling a little bit to reconcile the Q2 segment results with Q1 based on disclosed utilization. It looks like operating days were actually a little higher in Q2.

Speaker Change: In making that a little bit challenging, but I think that's something that we'll be able to address obviously before the end of the year.

Speaker Change: Got it thank you guys.

Speaker Change: The revenue and profitability came down pretty sharply can you walk us through the main drivers of that step down and was there anything in the Q2 segment result that was much different than what you expected 90 days ago.

David Smith: Your next question comes from the line of David Smith with <unk> Securities.

Speaker Change: Please go ahead.

David Smith: Yeah.

David Smith: Hey, good morning, and I apologize in advance.

David Smith: My questions have been touched on it it's been a busy morning and RFS land.

Speaker Change: So from a from that standpoint, David we don't give annual guidance, but we did I think qualitatively qualitatively say that we expected our Q2 results to be more in line with Q1 because of the regulatory drivers Q1 was about $52 million we came.

David Smith: And I understand there can be quarter to quarter.

David Smith: Volatility in well intervention, alright, things like contract transitions regulatory downtime accounting for mobilization.

David Smith: I'm just struggling a little bit to reconcile the Q2 segment results with Q1.

Speaker Change: And about $42 million of EBITDA in the second quarter, two big drivers there.

David Smith: Based on disclosed utilization it looks like operating days were actually a little higher in Q2.

Speaker Change: Number one I think the shallow water, obviously slower start to the season.

Speaker Change: That impacted us a bit and then of course, we mentioned before the number of mobilization days, where we had deferred revenue cost and margins associated with well intervention that got pushed into the third quarter that was approximately about 20 days.

Speaker Change: And so those were probably the.

Speaker Change: Two biggest drivers that did not allow us to to achieve sort of results in line with the first quarter as far as the revenue.

Speaker Change: I think what we will say is I think the utilization numbers include 45 days of transit on the Q4 thousand which were not revenue days, but were costs incurred days. So I think that that is possibly skewing the numbers and then the.

Speaker Change: We came in about $42 million of EBITDA in the second quarter, two big drivers there.

Speaker Change: Number one I think the shallow water, obviously slower start to the season.

Speaker Change: The rates on the Q4 thousand working overseas in Nigeria, where there is a significant amount of pass throughs also definitely.

Speaker Change: Definitely skews the revenue.

Speaker Change: And per day rate.

Speaker Change: And so so those were probably the two.

David Smith: What you see in Q1, I don't know Brent if there's anything you'd like to add.

Speaker Change: Two biggest drivers that did not allow us to to achieve sort of results in line with the first quarter as.

Brent Jaeger: I think Eric I think you've covered covered all the main points there.

Speaker Change: As far as the revenue I think what we will say is I think the utilization numbers include 45 days of transit on the Q4 thousand which were not revenue days, but were costs incurred days. So I think that that is possibly skewing the numbers and then.

Brent Jaeger: Okay I do appreciate it.

Speaker Change: Just a quick housekeeping question, where the where the mobilization days. So I did exclude the 45 days for the Q4.

Speaker Change: The mobilization days for the Q seven and the first quarter.

Speaker Change: Contributing to the Q1 revenue.

Speaker Change: The the rates on the on the Q4 thousand working overseas in Nigeria, where there is a significant amount of pass throughs also definitely.

Speaker Change: So Q1 revenue on the Q 7000, we only had about $5 five or six days of revenue in Q1 on the Q seven.

Speaker Change: It definitely skews the revenue.

Speaker Change: And per day rate.

Speaker Change: So obviously second quarter, we had the vessel working.

Speaker Change: You see in Q1, I don't know Brent if there's anything you'd like to add.

Speaker Change: Other than downtime the vessel was working in the second quarter.

Brent: Eric I think you've covered covered all the main points there.

Speaker Change: Thanks, Ed.

Speaker Change: Okay I do appreciate it.

Speaker Change: Utilization days are talking about as it relates into key five key for fathom and the well enhancer.

Speaker Change: A quick housekeeping question, where the where the mobilization days. So I did exclude the 45 days for the Q4.

Speaker Change: Mobilization days 20 days, he is talking about going into Q3.

Speaker Change: The mobilization days for the Q seven and the first quarter.

Speaker Change: I appreciate it.

Speaker Change: Contributing to the Q1 revenue.

Speaker Change: Follow up later thank you.

Speaker Change: Thank you.

Speaker Change: Yes.

Josh Chan: Your next question comes from the line of Josh Chan with Daniel Energy Partners. Please go ahead.

Speaker Change: So Q1 revenue on the Q 7000, we only had about $5 five or six days of revenue in Q1 on the Q seven.

Josh Chan: Thanks first one I just wanted to go back to the three year agreement you signed with Exxon on the shallow water abandonment side.

Speaker Change: And so obviously second quarter, we had the vessel working I think other than downtime. The vessel was working in the second quarter.

Speaker Change: I think Owen.

Speaker Change: The commentary you said close to 200 wells, maybe could you frame the number of other opportunities that are out there that are being bid on today, just so we can sort of.

Speaker Change: Thanks, Ed.

Speaker Change: Utilization days are talking about as it relates into key five key for fathom and the well enhancer.

Think about how that could progress over the next couple of years.

Speaker Change: Those mobilization days 20 days is talking about going into Q3.

Speaker Change: We are seeing.

Speaker Change: Similar, although probably slightly less utilization and utilization opportunities in the marketplace.

Speaker Change: I appreciate it.

Speaker Change: We will follow up later thank you.

Speaker Change: Thank you.

Speaker Change: Bidding activity ongoing through Q3, and Q4 of this year.

Speaker Change: Your next question comes from the line of Josh Chan with data partners. Please go ahead.

Speaker Change: Going forward basis.

Speaker Change: Generally what we're seeing is.

Speaker Change: Thanks <unk>.

Speaker Change: Those agreements are in discussion.

Speaker Change: One I just wanted to go back to the three year agreement you signed with Exxon on the shallow water abandonment side.

Firmly contracted work.

Speaker Change: We are getting better visibility on the marketplace, but we do continue to expect properties to Boomerang back end for the demand to increase in 2026.

I think Owen.

Speaker Change: The commentary you said close to 200 wells, maybe could you frame the number of other opportunities that are out there that are being bid on today, just so we can sort of.

Speaker Change: Okay. Thanks.

Speaker Change: Think about how that could progress over the next couple of years.

Speaker Change: A little clarity around the contract.

Speaker Change: We are seeing similar although currently slightly less utilization our utilization opportunities in the marketplace. There is bidding activity ongoing.

Speaker Change: That contract was for the World work.

Speaker Change: There is a separate contract that was led that's ongoing right now which is for the makes it work.

Speaker Change: Work really starts once that complete.

Speaker Change: Q3, and Q4 of this year.

Speaker Change: But then our contractors for the World work and there is additional work for the subsea architecture.

Speaker Change: A go forward basis.

Speaker Change: Generally what we're seeing is that.

Speaker Change: Fragrance agreements our discussion around the firm.

Speaker Change: And the provision of a heavy lift and lift boats and everything that will be forthcoming.

Speaker Change: Currently contracted work. However, we are getting better visibility on the marketplace and we do continue to expect properties to Boomerang back end for the demand to increase in 2026.

Speaker Change: This award puts us in good.

Speaker Change: A good position.

Speaker Change: To expand on.

Speaker Change: Well, that's a prudent contractors for later on.

Speaker Change: So it's a little clearer to add around some contract.

Speaker Change: Okay. Thanks, and then one on the intervention side I think you had mentioned the potential for the north sea to be a.

Speaker Change: That contract was for the World work.

Speaker Change: There is a separate contract that was led that's ongoing right now which is for the make safe work.

Speaker Change: A two vessel market again in 2026, and any thought because I assume.

Speaker Change: Timing of figuring that out we will factor into your.

Speaker Change: Our work really starts once that completes.

Speaker Change: How to handle the seawell from a cost standpoint could you speak to when you might anticipate knowing if it's going to be a one vessel or two vessel market in 2006, and how you could also see.

Speaker Change: But then our contractors for the World work and there is additional work for the subsea architecture.

Speaker Change: And the provision of a heavy lift and lift boats and everything that will be forthcoming.

Speaker Change: This award puts us in good.

Speaker Change: Regardless of what happens in 2006 do you think that it will be a two vessel market in 2027.

Speaker Change: Good position to expand.

Speaker Change: To work with us.

Speaker Change: So right now we're concentrating on the work onto that will enhance the seawell is stacked a very low cost base.

Speaker Change: Crude contractors for later on.

Speaker Change: Okay. Thanks, and then one on the intervention side I think you had mentioned the potential for the north sea to be a.

Speaker Change: The crude down to minimum safe manner, and that sort of thing where and in discussions with a couple of clients on larger decommissioning tenders. If those tenders are awarded to US then we would expect to go back to a two vessel market in 2026, I think to be fair. The timing of the award of those tenders will be late to key free probably <unk>.

Speaker Change: Two vessel market again in 2026, and any thought because I assume.

Speaker Change: Timing of figuring that out we will factor into your.

Speaker Change: Q4, and then they'll go into a planning stage.

Speaker Change: Those tenants are looking very good.

Speaker Change: I would say that very competitive, but most of the mindset that they could easily shift that work into 2027 say based on the awards and the timing and when that happens we should not around Q4, when we go back to a two vessel market or whether we can sustain stack magna the seawell.

Speaker Change: Regardless of what happens in 2006 do you think that it will be a two vessel market in 2027.

Speaker Change: So right now we're concentrating on the work onto the well enhancer the <unk>.

Speaker Change: Well as stacked a very low cost base.

Speaker Change: The crude down to minimum safe manner, and that sort of thing we're in discussions with a couple of clients on larger decommissioning tenders. If those tenders are awarded to US then we would expect to go back to a two vessel market in 2026, I think to be fair. The timing of the award of those tenders will be late to key free probably key.

Speaker Change: Certainly a lot of activity out there to keep the well enhancer busy for next year.

Speaker Change: Those tenders coming to fruition, we would decide on whether or not we go back to two vessel market.

Speaker Change: Great. Thank you I'll turn it back.

Speaker Change: Yeah.

Speaker Change: Next question will come from the line again.

Speaker Change: Before and in that guidance, we're planning stage say those tenders are looking very good.

Speaker Change: Jean Jacques Goldman. Please go ahead.

Speaker Change: Yes, Thank you and I'm going to hit on the U K North Sea again, and you addressed it a little bit but why not.

Speaker Change: What I will say that very competitive, but most of the mindset that they could easily shift that work into 2027 and say based on the awards and the timing and when the work captains, we should not around Q4, what will we go back to a two vessel market over we sustained stack magna the seawell.

Speaker Change: Why not take this opportunity with the seawell stacks why not.

Speaker Change: Upgrade the vessel to be able to mobilize it out of the UK North Sea.

Speaker Change: Certainly a lot of activity out there to keep the well enhancer busy for next year.

Speaker Change: I think what you were saying is if.

Speaker Change: Those tenders coming to fruition, we would decide on whether or not we go back to achieve vessel market.

Speaker Change: If the customers.

Speaker Change: Decides that they're not going to do work and that will trip the.

Speaker Change: Great. Thank you I'll turn it back.

Speaker Change: The need to do a lot of P&A work, but they can just they can just delay that right like again, just not to work and just.

Speaker Change: Next question will come from the line again.

Jean: Jean shop TD Goldman. Please go ahead.

Speaker Change: Yes, Thank you and I'm going to hit on the U K North Sea again, and you addressed it a little bit but why not.

Speaker Change: Bide their time.

Speaker Change: <unk>.

Speaker Change: The PMA market as you know has been.

Speaker Change: Why not take this opportunity with the seawell stacks why not.

Speaker Change: Great opportunity forever, but it always gets pushed to the right. So.

Speaker Change: Why is that not going to happen again, why not take this opportunity you've got a vessel stacked.

Speaker Change: Upgrade the vessel to be able to mobilize it out of the UK North Sea.

Speaker Change: Why not take the opportunity you have plenty of cash.

Speaker Change: I think what you were saying is.

Speaker Change: Give yourself, some optionality and be able to serve another region because the U K North sea seems like very challenged going forward.

Speaker Change: If the customers.

Speaker Change: That they're not going to do work then that will trip.

Speaker Change: <unk>.

Speaker Change: The need to do a lot of P&A work, but they can just.

Speaker Change: Is it because you would rather upgrade the well enhancer and the well enhancer is working in or just.

Speaker Change: They can just delay that right like again, just not to work and just.

Speaker Change: Just help me understand that.

Speaker Change: Bide their time I mean.

Speaker Change: Alright.

Speaker Change: Oil is down to our capital deployment and return on capital.

Speaker Change: The PMA market as you know has been a.

Speaker Change: Forecast and all the indicators right now are for a strong market from 27% to 31, we're going to need both vessels. So youre looking at an upgrade in order to redeploy the vessel for 2026.

Speaker Change: Great opportunity forever, but it always gets pushed to the right. So.

Speaker Change: Why is that not going to happen again, why not take this opportunity you've got a vessels stacked.

Speaker Change: Why not take the opportunity of plenty of cash.

Speaker Change: Cost of that upgrade is not cheap.

Speaker Change: Give yourself, some optionality and be able to serve another region because the U K North sea seems like very challenged going forward.

Speaker Change: There is no way that it would be cost effective to do it for one year deployment and then have to return it to the north sea by 27. So I think it's a little early to make that decision that I'm not saying that that's not the right long term decision.

Speaker Change: Is it because you would rather upgrade the well enhancer and the well enhancer is working in or just.

Speaker Change: We are in discussions with producers and other regions about what their needs are but there is no concrete.

Speaker Change: Just help me understand that.

Speaker Change: I think it boils down to our capital deployment and return on capital.

Speaker Change: Definitive demand for a riser list vessel theirs.

Speaker Change: The forecast and all the indicators right now are for a strong market from 27% to 31, we're going to need both vessels. So youre looking at an upgrade in order to redeploy the vessel for 2026.

Speaker Change: The other regions right now there's a lot of talk and hypothetical so it'd be a little bit of a risk to spend that much capital one upgrading the seawell at this time.

Speaker Change: We've decided that we're going to see how these two large projects play out for 2026, if we're successful on both of them and there is a high probability that we return to a two vessel market in the U K for 2026 without the large capital expenditure.

Speaker Change: Cost of that upgrade is not cheap there is no way that it would be cost effective to do it for one year deployment and then have to return it to the north Sea by 27. So I think it's a little early to make that decision to I'm, not saying that thats not the right long term decision.

Speaker Change: Okay understood. Thank you.

Speaker Change: We are in discussions with producers and other regions about what their needs are but there is no concrete.

Speaker Change: I'll just add to that we are finally seeing that the government is in the north sea is putting pressure for decommissioning to happen.

Speaker Change: Definitive demand for a riser less vessel theirs.

Speaker Change: These projects are planned for 2006, we have government pressure finally.

Speaker Change: Other regions right now, there's a lot of talk and hypothetical so it would be a little bit of a risk to spend that much capital one upgrading the seawell at this time.

Speaker Change: And given the uncertainty of the North Sea. If one of these clients we're talking to another regions once there Roger.

Speaker Change: So.

Speaker Change: We've decided that we're going to see how these two large projects play out for 2026, if we're successful on both of them. There is a high probability that we return to a two vessel market in the U K for 2026 without the large capital expenditure.

Speaker Change: With better terms and more certainty.

Speaker Change: Duration of the contracts.

Speaker Change: And then we would certainly.

Speaker Change: Price it to them and make that decision.

Speaker Change: North Sea returned to two vessel market.

Speaker Change: We cross that bridge when we came to it but we would take the more certain long term future.

Speaker Change: Okay understood. Thank you.

Speaker Change: I'll just add to that we are finally seeing that the government is in the north sea is putting pressure for decommissioning to happen.

Speaker Change: Got it thank you very much.

Brent Jaeger: Thank you so much everyone and that concludes our Q&A session for today I will now turn the call back over to Mr. Becker Jager. Please go ahead.

Speaker Change: These projects are planned for 2006, we have government pressure finally and.

Speaker Change: And given the uncertainty of the North Sea. If one of these clients we're talking to another regions once the horizon.

Brent Jaeger: Thanks for joining us today, we very much appreciate your interest and participation.

Speaker Change: So.

With better terms and more certainty.

Brent Jaeger: And we look forward to having you on our third quarter call 2025 and October Thank you.

Speaker Change: Of duration of the contracts.

Speaker Change: And then we would certainly.

Brent Jaeger: Ladies and gentlemen that concludes today's call. Thank you all for joining you may now disconnect.

Speaker Change: Price it to them and make that decision.

Brent Jaeger: Hi.

Speaker Change: North Sea returned to a two vessel market.

Speaker Change: We've done we cross that bridge when we came to it but we will we would take the more certain long term future.

Speaker Change: Got it thank you very much.

Speaker Change: Thank you so much everyone and that concludes our Q&A session for today I will now turn the call back over to Mr. <unk> for closing remarks. Please go ahead.

Speaker Change: Thanks for joining us today, we very much appreciate your interest and participation.

Speaker Change: And we look forward to having you on our third quarter call 2025 and October Thank you.

Speaker Change: Ladies and gentlemen that concludes today's call. Thank you all for joining you may now disconnect have a nice day.

Speaker Change: [music].

Q2 2025 Helix Energy Solutions Group Inc Earnings Call

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