Helix Energy Solutions Group (HLX) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $32.3M ($0.21/share), up from a net loss of $26.3M in Q1 2024 and $7.1M in Q2 2023, with revenues of $365M, driven by strong performance in Well Intervention and Robotics.

• Adjusted EBITDA reached $97M, up 37% year-over-year, with gross profit of $75M and margin improving to 21%.

• Cash and cash equivalents stood at $275M, with liquidity of $370M and net debt of $44M at quarter end.

• Alliance acquisition earn-out of $85M was paid in Q2, impacting operating and free cash flow.

• Backlog at June 30, 2024 was $873M, with 73% from major contracts with Shell, ExxonMobil, Subsea 7, Trident Energy, Petrobras, and the HP I agreement.

Financial highlights

• Q2 2024 revenues were $365M, up 18% year-over-year and from $296M in Q1 2024; six-month revenues totaled $661M.

• Q2 2024 net income was $32.3M, up from $7.1M in Q2 2023; six-month net income was $6M.

• Adjusted EBITDA for Q2 was $97M, up from $71M in Q2 2023; free cash flow was negative $16M, reflecting the Alliance earn-out payment.

• Gross profit for Q2 was $75.5M (21% margin), up from $55.3M (18%) in Q2 2023.

• Share repurchases in Q2 totaled $5M; year-to-date repurchases reached $10M.

Outlook and guidance

• 2024 revenue guidance: $1.25B–$1.4B; adjusted EBITDA: $270M–$330M; free cash flow: $90M–$125M (or $148M–$183M excluding earn-out impact); CapEx forecast reduced to $60M–$80M.

• Share repurchase target of $20M–$30M for 2024, with $10M completed year-to-date.

• Second half of 2024 expected to be on par or slightly stronger than first half, with Q2 and Q3 as most active quarters.

• 2025 expected to benefit from legacy contracts rolling off and new contracts at higher market rates, especially in Brazil and Gulf of Mexico.

• Management expects further improvements in 2025, focusing on execution of the Energy Transition strategy.