Constellation Oil Services (COSH) Q4 2024 earnings summary

Executive summary

• Achieved 97% fleet uptime in 2024, up over 300bps from 2023, and secured a $2.1 billion backlog as of year-end.

• Completed major financial recapitalization and refinancing, reducing leverage and strengthening the balance sheet.

• Listed shares on Euronext Growth Oslo in March 2025, enhancing liquidity and market visibility, with a market cap of NOK 8 billion (US$0.7 billion).

• Secured five new contracts in H2 2024, increasing backlog by 31% to $2.1 billion, and ranked 1st in Petrobras Offshore Driller Ranking since Q3 2024.

• Awarded multiple new contracts and extensions with Petrobras and Brava Energia, enhancing backlog and operational visibility.

Financial highlights

• Adjusted EBITDA rose to $231 million in 2024 from $185 million in 2023, with margin improving to 40.9% from 33.6%.

• Net operating revenues increased 2.1% year-over-year to $564 million, driven by higher day-rates and improved uptime.

• Operating cash flow reached $224 million, up 51.5% from 2023.

• Adjusted net loss narrowed to $28.6 million from $69 million in 2023.

• Net debt reduced by $420 million to $454 million; net debt/EBITDA improved to 2x from 4.7x.

Outlook and guidance

• 2025 expected to be a transitional year with five contract transitions, leading to lower revenue and EBITDA ($535–$555 million revenue, $160–$180 million EBITDA).

• Significant growth anticipated in 2026 as new contracts become fully operational, with base case EBITDA potential of $470 million.

• 2025 CapEx guidance at $150 million, mainly for contract transitions; normalized annual CapEx expected at $55–$60 million post-2025.

• Plans to introduce dividends and/or share buybacks starting in 2026, contingent on reaching 1.25x net leverage.

• Management expects continued strong performance in 2025, supported by a robust backlog and improved balance sheet.