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

Civeo Corporation reported mixed financial results for the first quarter of 2025, with consolidated revenue reaching $144.0 million despite facing notable challenges in its Canadian operations. The company's performance was characterized by substantial weakness in Canada offset by continued strength in its Australian segment, reflecting divergent market conditions across its geographic operations.

The Canadian segment experienced a dramatic 40.0% year-over-year revenue decline to $40.4 million, driven primarily by reduced customer spending in the oil sands region and the loss of Fort Hills-related occupancy. This downturn in both pricing and billed rooms volume prompted aggressive cost-cutting measures, including a 25% reduction in Canadian headcount and the cold-shuttering of two lodges. These actions represent significant operational adjustments in response to challenging market conditions in the Canadian resource sector.

In contrast, the Australian segment demonstrated remarkable resilience with 13% year-over-year revenue growth to $103.6 million. This strong performance was fueled by increased integrated services activity under a six-year, A$1.4 billion contract and strategic expansion initiatives in the Bowen Basin. The Australian operations continue to benefit from stable demand and long-term contractual arrangements that provide revenue visibility and operational stability.

Civeo has revised its full-year 2025 guidance, now projecting revenue between $620 million and $650 million with adjusted EBITDA expected to range from $75 million to $85 million. The company has also lowered its capital expenditure guidance to $20-$25 million, emphasizing disciplined capital deployment in the current market environment. These revised projections reflect the company's cautious outlook while maintaining confidence in its core business model.

The company implemented significant changes to its capital allocation strategy, increasing its share repurchase authorization from 10% to 20% of shares outstanding. During the quarter, Civeo repurchased 153,000 shares for approximately $3.3 million and suspended its quarterly dividend to prioritize buybacks and enhance financial flexibility. This strategic shift underscores the company's focus on optimizing shareholder returns while navigating current market challenges.

Civeo's net debt increased $20.9 million quarter-over-quarter to $59.0 million, resulting in a net leverage ratio of 0.8x. Despite these financial pressures, the company maintains confidence in its long-term free cash flow generation capabilities, supported by a capital-light operational model and a high mix of recurring asset-light services revenue. The company's ability to generate consistent cash flow remains central to its strategic positioning and financial stability.