Helix Energy Solutions Group, Inc. (NYSE:HLX) is an international offshore energy services company that provides specialty services to the offshore energy industry, with a focus on well intervention, robotics, and decommissioning operations. Helix's services are key in supporting the global energy transition by maximizing production of existing oil and gas reserves, decommissioning end-of-life oil and gas fields, and supporting renewable energy developments.
Helix operates in four reportable business segments: Well Intervention, Robotics, Shallow Water Abandonment, and Production Facilities. The Well Intervention segment provides services enabling Helix's customers to safely access subsea offshore wells for the purpose of performing production enhancement or decommissioning operations. The Robotics segment provides trenching, seabed clearance, offshore construction, and inspection, repair, and maintenance (IRM) services to both the oil and gas and the renewable energy markets globally. The Shallow Water Abandonment segment provides services in support of the upstream and midstream industries predominantly in the Gulf of Mexico shelf, including offshore oilfield decommissioning and reclamation, project management, engineered solutions, intervention, maintenance, repair, heavy lift, and commercial diving services. The Production Facilities segment includes the Helix Producer I (the "HP I"), a ship-shaped dynamically positioned floating production vessel, the Helix Fast Response System (the "HFRS"), and Helix's ownership of mature oil and gas properties.
Financials
For the full year 2023, Helix reported annual net income of -$10,838,000, annual revenue of $1,289,728,000, annual operating cash flow of $145,640,000, and annual free cash flow of $126,052,000. Helix's financial performance has shown significant improvement in 2024, with the second quarter of 2024 being particularly strong.In the second quarter of 2024, Helix reported revenues of $364,797,000, a 18% increase compared to the same period in 2023. Gross profit for the quarter was $75,486,000, up from $55,349,000 in the second quarter of 2023. Net income for the quarter was $32,289,000, compared to $7,100,000 in the same period last year. Adjusted EBITDA for the quarter was $96,895,000.
For the first six months of 2024, Helix reported revenues of $661,008,000, a 18% increase compared to the first six months of 2023. Gross profit for the period was $95,040,000, up from $70,533,000 in the same period last year. Net income for the first half of 2024 was $6,002,000, compared to $1,935,000 in the first six months of 2023. Adjusted EBITDA for the first half of 2024 was $143,885,000.
Segmental Performance
Helix's Well Intervention segment had a strong second quarter, with revenues of $224,679,000, a 46% increase compared to the same period in 2023. Gross profit for the segment was $33,615,000, up from $6,974,000 in the second quarter of 2023. The increase in revenues and profitability was driven by higher utilization and rates in the Gulf of Mexico, higher rates on the Seawell vessel, and higher revenues on the Q7000 vessel.The Robotics segment also had a solid quarter, with revenues of $81,249,000, a 16% increase compared to the second quarter of 2023. Gross profit for the segment was $30,888,000, up from $19,524,000 in the same period last year. The increase in revenues and profitability was primarily due to higher chartered vessel days and increased trenching and ROV activities.
The Shallow Water Abandonment segment, however, experienced a decline in performance, with revenues of $50,841,000, a 33% decrease compared to the second quarter of 2023. The segment reported a gross profit of $1,654,000, down from $20,992,000 in the same period last year. The decrease in revenues and profitability was due to lower activity levels and an overall softer Gulf of Mexico shelf market in 2024, resulting in lower vessel and system utilization.
The Production Facilities segment reported revenues of $25,400,000, a 10% increase compared to the second quarter of 2023. Gross profit for the segment was $9,891,000, up from $8,654,000 in the same period last year. The increase in revenues and profitability was primarily due to higher oil and gas production during the second quarter of 2024, as both the Droshky and Thunder Hawk wells were shut in for planned maintenance during portions of the second quarter of 2023.
Liquidity
As of June 30, 2024, Helix had cash and cash equivalents of $275,066,000 and availability under its asset-based revolving credit facility of $95,100,000, resulting in total liquidity of $370,133,000. Helix's long-term debt, excluding current maturities, stood at $309,664,000.Outlook
Helix has provided the following guidance for the full year 2024:- Revenue: $1,250,000,000 to $1,400,000,000
- Adjusted EBITDA: $270,000,000 to $330,000,000
- Free Cash Flow: $90,000,000 to $125,000,000
- Capital Expenditures: $60,000,000 to $80,000,000
Helix expects the second half of 2024 to be on par or slightly stronger than the first half, despite the anticipated impacts of the Q4000 transit to Nigeria and the Q7000 transit to Brazil. Helix also anticipates that well intervention will add $60 million to $100 million of EBITDA in 2025 compared to 2024, driven by the company's ability to secure market-rate contracts on several of its well intervention assets as legacy rates roll off.