What changed in Civeo Corp's 10-K — 2023 vs 2024
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Paragraph-level year-over-year comparison of Civeo Corp's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.
+280 added−279 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-29)
Top changes in Civeo Corp's 2024 10-K
280 paragraphs added · 279 removed · 238 edited across 2 sections
- Item 1C. Cybersecurity+169 / −177 · 143 edited
- Item 1A. Risk Factors+111 / −102 · 95 edited
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
95 edited+16 added−7 removed123 unchanged
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
95 edited+16 added−7 removed123 unchanged
2023 filing
2024 filing
Biggest changeThis summary should be read in connection with the Risk Factors more fully described below and should not be relied upon as an exhaustive summary of the material risks facing our business. • Risks Related to Our Macroeconomic-Business Environment ◦ Certain of our customers’ spending may be directly, and our business may be indirectly, affected by (i) volatile or low oil, metallurgical (met) coal, natural gas or iron ore prices; (ii) increasing production costs; or (iii) unsuccessful exploration results. ◦ The effects of public health crises, pandemics and epidemics may materially affect how we and our customers are operating our and their businesses. • Risks Related to Our Customers ◦ Our customers and their operations are exposed to a number of unique operating risks and challenges. ◦ We depend on several significant customers. ◦ Our failure to retain our current customers, renew our existing customer contracts and obtain new customer contracts, or the termination of existing contracts, could adversely affect our business. ◦ Adverse events in areas where we operate could negatively impact our business, and our geographic concentration could limit the number of customers seeking our services. ◦ We may be adversely affected if customers reduce their accommodations outsourcing. • Risks Related to Our Operations ◦ We operate in a highly competitive industry, and if we fail to compete effectively, our business will suffer. ◦ Our operations may suffer due to over-capacity of certain types of accommodations assets in certain regions. ◦ Increased operating costs and limited cost recovery through pricing or contract terms may constrain our ability to make a profit. ◦ Employee and customer labor problems could adversely affect us. ◦ A failure to maintain food safety or comply with government regulations related to food and beverages or serving alcoholic beverages may subject us to liability. ◦ The majority of our major Canadian lodges are located on land subject to leases. ◦ We are susceptible to seasonal earnings volatility due to adverse weather conditions in our regions of operations. ◦ Failure to maintain positive relationships with the Indigenous people in the areas where we operate could adversely affect our business. ◦ Development of permanent infrastructure in the areas where we locate our assets could negatively impact our business. ◦ We may be subject to risks associated with the transportation, installation and demobilization of mobile accommodations. ◦ Our business could be negatively impacted by security threats, including cybersecurity threats and other disruptions. ◦ Our business could be disrupted by any failure of our information technology systems. ◦ Loss of key members of our management could adversely affect our business. • Financial/Accounting Risks ◦ Currency exchange rate fluctuations could adversely affect our U.S. dollar reported results of operations and financial position. 24 ◦ We may not have adequate insurance for potential liabilities and insurance may not cover certain liabilities. ◦ The cyclical nature of our business and a severe prolonged downturn has, and could in the future, negatively affect the value of our long-lived assets and our goodwill. ◦ Our inability to control the inherent risks of identifying, acquiring and integrating businesses that we may acquire could adversely affect our operations. ◦ Our indebtedness could restrict our operations and make us more vulnerable to adverse economic conditions. • Legal and Regulatory Risks ◦ We do business in Canada and Australia, whose political and regulatory environments and compliance regimes differ from those in the U.S. ◦ We are subject to extensive and costly environmental laws and regulations. ◦ We may be exposed to certain regulatory and financial risks related to climate change and other environmental, social and governance (ESG) related matters. • Risks Related to Our Common Shares ◦ The market price and trading volume of our common shares may be volatile. ◦ The payment of dividends and repurchases of our common shares are each within the discretion of our Board of Directors, and there is no guarantee that we will pay any dividends or repurchase common shares in the future or at levels anticipated by our shareholders. ◦ We are governed by the corporate laws in British Columbia, Canada. ◦ Provisions contained in our articles and applicable Canadian and British Columbia laws could discourage a take-over attempt. ◦ The enforcement of civil liabilities against Civeo may be more difficult. • Risks Related to Our Structure ◦ We are subject to various Canadian, Australian and other taxes. ◦ We remain subject to changes in tax law (in various jurisdictions) and other factors that could impact our effective tax rate. ◦ Future potential changes to U.S. tax laws could result in Civeo being treated as a U.S. corporation for U.S. federal income tax purposes.
Biggest changeThis summary should be read in connection with the Risk Factors more fully described below and should not be relied upon as an exhaustive summary of the material risks facing our business. • Risks Related to Our Customers ◦ Certain of our customers’ spending may be directly, and our business may be indirectly, affected by (i) volatile or low met coal, oil, natural gas or iron ore prices; (ii) elevated or increasing production costs; or (iii) unsuccessful exploration results. ◦ Our customers and their operations are exposed to a number of unique operating risks and challenges. ◦ We depend on several significant customers. ◦ Our failure to retain our current customers, renew our existing customer contracts and obtain new customer contracts, or the termination of existing contracts, could adversely affect our business. ◦ Adverse events in areas where we operate could negatively impact our business, and our geographic concentration could limit the number of customers seeking our services. ◦ We may be adversely affected if customers reduce their accommodations outsourcing. • Risks Related to Our Operations ◦ We operate in a highly competitive industry, and if we fail to compete effectively, our business will suffer. ◦ Our operations may suffer due to over-capacity of certain types of accommodations assets in certain regions. ◦ Increased operating costs and limited cost recovery through pricing or contract terms may constrain our ability to make a profit. ◦ Employee and customer labor problems could adversely affect us. ◦ Failure to develop or maintain positive relationships with the Indigenous people in the areas where we operate could adversely affect our business. ◦ Development of permanent infrastructure in the areas where we locate our assets could negatively impact our business. ◦ A failure to maintain food safety or comply with government regulations related to food and beverages or serving alcoholic beverages may subject us to liability. ◦ The majority of our major Canadian lodges are located on land subject to leases. ◦ We are susceptible to seasonal earnings volatility due to seasonal weather patterns in our regions of operations. ◦ We may be subject to risks associated with the transportation, installation and demobilization of mobile accommodations. ◦ Our business could be negatively impacted by security threats, including cybersecurity threats and other disruptions. ◦ Our business could be disrupted by any failure of our information technology systems. ◦ Loss of key members of our management could adversely affect our business. ◦ The effects of public health crises, pandemics and epidemics may materially affect how we and our customers are operating our and their businesses. • Financial/Accounting Risks ◦ Currency exchange rate fluctuations could adversely affect our U.S. dollar reported results of operations and financial position. ◦ We may not have adequate insurance for potential liabilities and insurance may not cover certain liabilities. 22 ◦ The cyclical nature of our business and a severe prolonged downturn has, and could in the future, negatively affect the value of our long-lived assets and our goodwill. ◦ Our inability to control the inherent risks of identifying, acquiring and integrating businesses that we may acquire could adversely affect our operations. ◦ Our indebtedness could restrict our operations and make us more vulnerable to adverse economic conditions. • Legal and Regulatory Risks ◦ We do business in Canada and Australia, whose political and regulatory environments and compliance regimes differ from those in the U.S. ◦ We are subject to extensive and costly environmental laws and regulations. ◦ We may be exposed to certain regulatory and financial risks related to climate change and other environmental, social and governance (ESG) related matters. • Risks Related to Our Common Shares ◦ The market price and trading volume of our common shares may be volatile. ◦ The payment of dividends and repurchases of our common shares are each within the discretion of our Board of Directors, and there is no guarantee that we will pay any dividends or repurchase common shares in the future or at levels anticipated by our shareholders. ◦ We are governed by the corporate laws in British Columbia, Canada. ◦ Provisions contained in our articles and applicable Canadian and British Columbia laws could discourage a take-over attempt. ◦ The enforcement of civil liabilities against Civeo may be more difficult. • Risks Related to Our Structure ◦ We are subject to various Canadian, Australian and other taxes. ◦ We remain subject to changes in tax law (in various jurisdictions) and other factors that could impact our effective tax rate. ◦ Future potential changes to U.S. tax laws could result in Civeo being treated as a U.S. corporation for U.S. federal income tax purposes.
Prices for oil, met coal, LNG, iron ore and other natural resources are subject to large fluctuations in response to changes in global supply of and demand for these commodities.
Prices for met coal, oil, LNG, iron ore and other natural resources are subject to large fluctuations in response to changes in global supply of and demand for these commodities.
We depend on several significant customers, including customers that operate in the natural resources industry.
We depend on several significant customers. We depend on several significant customers, including customers that operate in the natural resources industry.
If permanent towns, cities and municipal infrastructure develop, grow or otherwise become available in the oil sands region of northern Alberta, Canada, the west coast of British Columbia or regions of Australia where we operate, then demand for our hospitality services could decrease as customer employees move to the region and choose to utilize permanent housing and food service.
If permanent towns, cities and municipal infrastructure develop, grow or otherwise become available in the regions of Australia where we operate, the oil sands region of northern Alberta, Canada or the west coast of British Columbia, then demand for our hospitality services could decrease as customer employees move to the region and choose to utilize permanent housing and food service.
Financial/Accounting Risks Currency exchange rate fluctuations could adversely affect our U.S. dollar reported results of operations and financial position. Our reporting currency is the U.S. dollar, and we are exposed to currency exchange risk primarily between the U.S. dollar and the Canadian and Australian dollars.
Financial/Accounting Risks Currency exchange rate fluctuations could adversely affect our U.S. dollar reported results of operations and financial position. Our reporting currency is the U.S. dollar, and we are exposed to currency exchange risk primarily between the U.S. dollar and the Australian and Canadian dollars.
We may not be able to effect any of these remedies on satisfactory terms or at all, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. Legal and Regulatory Risks We do business in Canada and Australia, whose political and regulatory environments and compliance regimes differ from those in the U.S.
We may not be able to effect any of these remedies on satisfactory terms or at all, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. Legal and Regulatory Risks We do business in Australia and Canada, whose political and regulatory environments and compliance regimes differ from those in the U.S.
Risks associated with our operations in Canada and Australia include, but are not limited to, (i) different taxing regimes; (ii) changing political conditions at the federal, provincial or state level; (iii) changing international and U.S. monetary policies; and (iv) regional economic downturns.
Risks associated with our operations in Australia and Canada include, but are not limited to, (i) different taxing regimes; (ii) changing political conditions at the federal, provincial or state level; (iii) changing international and U.S. monetary policies; and (iv) regional economic downturns.
The outcome of Canadian, Australian and U.S. federal, regional, provincial and state actions to address global climate change could result in a variety of regulatory programs including potential new regulations, additional charges to fund energy efficiency activities, or other regulatory actions.
The outcome of Australian, Canadian and U.S. federal, regional, provincial and state actions to address global climate change could result in a variety of regulatory programs including potential new regulations, additional charges to fund energy efficiency activities or other regulatory actions.
The market price of our common shares may be influenced by many factors, some of which are beyond our control, including those described above and the following: • changes in financial estimates by analysts and our inability to meet those financial estimates; • strategic actions by us or our competitors; • announcements by us or our competitors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments; • variations in our quarterly operating results and those of our competitors; • general economic and stock market conditions; • risks related to our business and our industry, including those discussed above; • changes in conditions or trends in our industry, markets or customers; • geopolitical events or terrorist acts, including cybersecurity threats; • trading volume of our common shares; • the majority of our common shares being held by a few shareholders; • our policy on share repurchases and dividend payments; 35 • future sales of our common shares or other securities by us, members of our management team or our existing shareholders; and • investor perceptions of the investment opportunity associated with our industry or common shares relative to other investment alternatives.
The market price of our common shares may be influenced by many factors, some of which are beyond our control, including those described above and the following: • changes in financial estimates by analysts and our inability to meet those financial estimates; • strategic actions by us or our competitors; • announcements by us or our competitors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments; • variations in our quarterly operating results and those of our competitors; • general economic and stock market conditions; • risks related to our business and our industry, including those discussed above; • changes in conditions or trends in our industry, markets or customers; • geopolitical events or terrorist acts, including cybersecurity threats; • trading volume of our common shares; • the majority of our common shares being held by a few shareholders; • our policy on share repurchases and dividend payments; • future sales of our common shares or other securities by us, members of our management team or our existing shareholders; and • investor perceptions of the investment opportunity associated with our industry or common shares relative to other investment alternatives.
Other effects of such public health crises, pandemics and epidemics include significant volatility and disruption of the global financial markets; continued volatility of commodity prices and related uncertainties around OPEC+ production; disruption of operations resulting from decreased customer demand and labor shortages; supply chain disruptions or equipment shortages; reduced capital spending by oil and gas companies; and employee impacts from illness, travel restrictions, including border closures, and other community response measures.
Other effects of such public health crises, pandemics and epidemics include significant volatility and disruption of the global financial markets; volatility of commodity prices and related uncertainties around OPEC+ production; disruption of operations resulting from decreased customer demand and labor shortages; supply chain disruptions or equipment shortages; reduced capital spending by oil and gas companies; and employee impacts and labor shortages from illness, travel restrictions, including border closures, and other community response measures.
Treasury regulations promulgated thereunder, or official interpretations thereof, could adversely affect Civeo’s status as a foreign corporation for U.S. federal income tax purposes. For example, members of Congress from time to time have proposed changes to the Internal Revenue Code, and the U.S. Treasury has taken and may continue to take regulatory action, in connection with inversion transactions.
Treasury regulations promulgated thereunder, or official interpretations thereof, could adversely affect Civeo’s status as a foreign corporation for U.S. federal income tax purposes. For example, 36 members of Congress from time to time have proposed changes to the Internal Revenue Code, and the U.S. Treasury has taken and may continue to take regulatory action, in connection with inversion transactions.
For example, in 2011 and 2017, cyclones and resulting flooding threatened our villages in Australia. Similarly, in 2011 and 2016, forest fires in northern Alberta impacted areas near our Canadian oil sands lodges. Moreover, global climate change may result in significant natural disasters occurring more frequently or with greater intensity, such as drought, wildfires, storms, sea-level rise, and flooding.
For example, in 2011 and 2017, cyclones and resulting flooding threatened our villages in Queensland, Australia. Similarly, in 2011 and 2016, forest fires in northern Alberta impacted areas near our Canadian oil sands lodges. Moreover, global climate change may result in significant natural disasters occurring more frequently or with greater intensity, such as drought, wildfires, storms, sea-level rise, and flooding.
If our business does not generate sufficient cash flows from operations to enable us to meet our obligations under our indebtedness, we will be forced to take actions such as reducing or delaying business activities, including dividend payments and share repurchases, 33 acquisitions, investments and/or capital expenditures, selling assets, restructuring or refinancing our indebtedness or seeking additional equity capital.
If our business does not generate sufficient cash flows from operations to enable us to meet our obligations under our indebtedness, we will be forced to take actions such as reducing or delaying business activities, including dividend payments and share repurchases, acquisitions, investments and/or capital expenditures, selling assets, restructuring or refinancing our indebtedness or seeking additional equity capital.
The final outcome of any audits by taxation authorities may differ from 37 the estimates and assumptions we may use in determining our consolidated tax provisions and accruals. This could result in a material adverse effect on our consolidated income tax provision, financial condition and the net income for the period in which such determinations are made. The U.S.
The final outcome of any audits by taxation authorities may differ from the estimates and assumptions we may use in determining our consolidated tax provisions and accruals. This could result in a material adverse effect on our consolidated income tax provision, financial condition and the net income for the period in which such determinations are made. The U.S.
We are subject to extensive and costly environmental laws and regulations that may require us to take actions that will adversely affect our results of operations. All of our operations are significantly affected by stringent and complex foreign, federal, provincial, state and local laws and regulations governing the discharge of substances into the environment or otherwise relating to environmental protection.
We are subject to extensive and costly environmental laws and regulations that may require us to take actions that will adversely affect our results of operations. 32 All of our operations are significantly affected by stringent and complex foreign, federal, provincial, state and local laws and regulations governing the discharge of substances into the environment or otherwise relating to environmental protection.
Our articles, subject to the corporate law of British Columbia, also authorize our Board to issue series of preferred shares without shareholder approval. If our Board elects to issue preferred 36 shares, it could increase the difficulty for a third-party to acquire us, which may reduce or eliminate our shareholders’ ability to sell their common shares at a premium.
Our articles, subject to the corporate law of British Columbia, also authorize our Board to issue series of preferred shares without shareholder approval. If our Board elects to issue preferred shares, it could increase the difficulty for a third-party to acquire us, which may reduce or eliminate our shareholders’ ability to sell their common shares at a premium.
Our future success depends, in part, upon our ability to manage this expanded business, which will pose substantial challenges for our management, including challenges related to the management and monitoring of new operations and associated increased costs and complexity. If we fail to manage any of these risks successfully, our business could be harmed.
Our future success depends, in part, upon our ability to manage this expanded business, which will pose substantial challenges for our management, including challenges related to the management and monitoring of new operations 31 and associated increased costs and complexity. If we fail to manage any of these risks successfully, our business could be harmed.
Our efforts to limit exchange risks may be unsuccessful, thereby exposing us to foreign currency fluctuations that could cause our results of operations, financial condition and cash flows to deteriorate. We may not have adequate insurance for potential liabilities and insurance may not cover certain liabilities. Our operations are subject to many hazards.
Our efforts to limit exchange risks may be unsuccessful, thereby exposing us to foreign currency fluctuations that could cause our results of operations, financial condition and cash flows to deteriorate. 30 We may not have adequate insurance for potential liabilities and insurance may not cover certain liabilities. Our operations are subject to many hazards.
In addition, any elimination of, or downward revision in, our dividend policy or our share repurchase program could have an adverse effect on the market price of our common shares. While the U.S. has imposed an excise tax on U.S. domestic corporations repurchasing stock, our share repurchase program is not currently subject to this tax.
In addition, any elimination of, or downward revision in, our dividend policy or our share repurchase program could have an adverse effect on the market price of our common shares. While the U.S. has imposed an excise tax on U.S. domestic corporations repurchasing stock, our share repurchase program is not subject to this tax.
Furthermore, these technologies may require refinements and upgrades, which may require significant investment by us. As various systems and technologies become outdated or new technology is required, we may not be able to replace or introduce them as quickly as needed or in a cost- effective and timely manner.
Furthermore, these technologies may require refinements and upgrades, which may require significant investment by us. As various systems and technologies become outdated or new technology is required, we may not be able to replace or introduce them as quickly as 29 needed or in a cost- effective and timely manner.
In addition, the delay or failure to implement information system upgrades and new systems effectively could disrupt our business, distract management’s focus and attention from business operations and growth initiatives, and increase our implementation 31 and operating costs, any of which could materially adversely affect our operations and operating results.
In addition, the delay or failure to implement information system upgrades and new systems effectively could disrupt our business, distract management’s focus and attention from business operations and growth initiatives, and increase our implementation and operating costs, any of which could materially adversely affect our operations and operating results.
Such attacks include, but are not limited to, malicious software, attempts to gain unauthorized access to data, ransomware attacks and other electronic security breaches that could lead to disruptions in critical systems, unauthorized release of or denial of access to confidential or otherwise protected information and corruption of data.
Such threats include, but are not limited to, malicious software, attempts to gain unauthorized access to data, ransomware attacks and other electronic security breaches that could lead to disruptions in critical systems, unauthorized release of or denial of access to confidential or otherwise protected information and corruption of data.
In addition, some claims may be more difficult to bring against Civeo in Canadian courts than it would be to bring similar claims against a U.S. company in a U.S. court. Risks Related to Our Structure We are subject to various Canadian, Australian and other taxes.
In addition, some claims may be more difficult to bring against Civeo in Canadian courts than it would be to bring similar claims against a U.S. company in a U.S. court. 35 Risks Related to Our Structure We are subject to various Canadian, Australian and other taxes.
For a more detailed explanation of our customers, see “Business” in Item 1 of this annual report. Our failure to retain our current customers, renew our existing customer contracts and obtain new customer contracts, or the termination of existing contracts, could adversely affect our business.
For a more detailed explanation of our customers, see “Business” in Item 1 of this annual report. 24 Failure to retain our current customers, renew our existing customer contracts and obtain new customer contracts, or the termination of existing contracts, could adversely affect our business.
In addition, food 28 prices can fluctuate as a result of foreign exchange rates and temporary changes in supply, including as a result of incidences of wildfires or severe weather such as droughts, heavy rains and late freezes, or other climate effects.
In addition, food prices can fluctuate as a result of foreign exchange rates and temporary changes in supply, including as a result of incidences of wildfires or severe weather such as droughts, heavy rains and late freezes, or other climate effects.
Risks Related to Our Customers Our customers and their operations are exposed to a number of unique operating risks and challenges which could also adversely affect us. We could be materially adversely affected by disruptions to our customers’ operations.
Our customers and their operations are exposed to a number of unique operating risks and challenges which could also adversely affect us. We could be materially adversely affected by disruptions to our customers’ operations.
Because of the concentration of our business in three relatively small geographic areas: the oil sands region of Alberta, Canada, the coal producing, Bowen Basin region of Queensland, Australia and the iron ore producing, Pilbarra region of Western Australia, we have increased exposure in these areas to political, regulatory, environmental, labor, climate or natural disasters such as forest fires or flooding, events or developments that could disproportionately impact our operations and financial results.
Because of the concentration of our business in three relatively small geographic areas, the oil sands region of Alberta, Canada, the coal producing, Bowen Basin region of Queensland, Australia and the iron ore producing, Pilbara region of Western Australia, we have increased exposure in these areas to political, regulatory, environmental, labor, climate or natural disasters such as forest fires or flooding, events or developments that could disproportionately impact our operations and financial results.
Future food product recalls and health concerns associated with food contamination may also increase our raw materials costs and, from time to time, disrupt our business. 29 A variety of regulations at various governmental levels relating to the handling, preparation and serving of food (including, in some cases, requirements relating to the temperature of food), cleanliness of food production facilities and hygiene of food-handling personnel are enforced primarily at the local public health department level.
Future food product recalls and health concerns associated with food contamination may also increase our raw materials costs and, from time to time, disrupt our business. 27 A variety of regulations at various governmental levels relating to the handling, preparation and serving of food (including, in some cases, requirements relating to the temperature of food), cleanliness of food production facilities and hygiene of food-handling personnel are enforced primarily at the local public health department level.
Our geographic concentration could limit the number of customers seeking our services, and as to any single lodge or village, we 27 may have few potential customers.
Our geographic concentration could limit the number of customers seeking our services, and as to any single lodge or village, we may have few potential customers.
If it becomes necessary or desirable to repatriate earnings from subsidiaries, repatriating earnings could, in certain circumstances, give rise to the imposition of potentially significant withholding taxes by the jurisdictions in which such amounts were earned, without our receiving the benefit of any offsetting tax credits, which could adversely impact our effective tax rate and cash flows.
If it becomes necessary or desirable to repatriate earnings from our foreign subsidiaries, repatriating earnings could, in certain circumstances, give rise to the imposition of potentially significant withholding taxes by the jurisdictions in which such amounts were earned, without our receiving the benefit of any offsetting tax credits in Canada, which could adversely impact our effective tax rate and cash flows.
If we are unable to renew our leases or permits on similar terms, it may have an adverse effect on our business and results of operations. We are susceptible to seasonal earnings volatility due to adverse weather conditions in our regions of operations. Our operations are directly affected by seasonal differences in weather in the areas in which we operate.
If we are unable to renew our leases or permits on similar terms, it may have an adverse effect on our business and results of operations. We are susceptible to seasonal earnings volatility due to seasonal weather patterns in our regions of operations. Our operations are directly affected by seasonal differences in weather in the areas in which we operate.
Any adoption of these or similar proposals by Canadian, Australian or U.S. federal, regional, provincial, state or local governments mandating a substantial reduction in greenhouse gas emissions could have far-reaching and significant impacts on the energy industry, including negatively impacting the price of oil relative to other energy sources, reducing demand for hydrocarbons and other minerals or limiting drilling or mining in the areas in which we operate.
Any adoption of these or similar proposals by Australian, Canadian or U.S. federal, regional, provincial, state or local governments mandating a substantial reduction in GHG emissions could have far-reaching and significant impacts on the energy industry, including negatively impacting the price of oil relative to other energy sources, reducing demand for hydrocarbons and other minerals or limiting drilling or mining in the areas in which we operate.
Even a partially uninsured or underinsured claim, if successful and of significant size, could have a material adverse effect on our results of operations or consolidated financial position. In addition, we are insured under the insurance policies of Oil States International, Inc.
Even a partially uninsured or underinsured claim, if successful and of significant size, could have a material adverse effect on our results of operations or consolidated financial position. In addition, we are insured under certain insurance policies of Oil States International, Inc.
It should also be noted that scientists have concluded that increasing concentrations of greenhouse gases (GHG) in the earth’s atmosphere may produce climate changes that have significant physical effects, such as increased frequency and severity of storms, droughts, and floods and other climatic events.
It should also be noted that scientists have concluded that increasing concentrations of GHG in the earth’s atmosphere may produce climate changes that have significant physical effects, such as increased frequency and severity of storms, droughts, and floods and other climatic events.
As a result, we may continue to face increasing pressure regarding our ESG disclosures and practices, and mandatory reporting obligations could increase our compliance burden and costs. We publish an annual ESG Report, which outlines our progress and ongoing efforts to advance our ESG initiatives.
As a result, we may continue to face increasing pressure regarding and focus on our ESG disclosures and practices, and mandatory reporting obligations could increase our compliance burden and costs. We publish an annual ESG Report, which outlines our progress and ongoing efforts to advance our ESG initiatives.
Public health crises, pandemics and epidemics, such as the COVID-19 pandemic, have adversely impacted and may in the future adversely impact, worldwide economic activity, including the operations of natural resources companies in Canada, Australia and the U.S. and the worldwide demand for oil and natural gas.
Public health crises, pandemics and epidemics, such as the COVID-19 pandemic, have adversely impacted, and may in the future adversely impact, worldwide economic activity, including the operations of natural resources companies in Australia, Canada and the U.S. and the worldwide demand for natural resources.
Although it is not possible at this time to predict how legislation or new regulations that may be adopted to address greenhouse gas emissions would impact our business, any such future laws and regulations could result in increased compliance costs or additional operating restrictions, and could have a material adverse effect on our business or demand for our services.
Although it is not possible at this time to predict how legislation or new regulations that may be adopted to address GHG emissions would impact our business, any such future laws and regulations could result in increased compliance costs or additional operating restrictions and could have a material adverse effect on our business or demand for our services.
We did not renew an expiring land lease associated with our McClelland Lake Lodge in Alberta, Canada, which expired in June 2023, in order to support our customer’s intent to mine the land where the lodge was located.
For example, we did not renew an expiring land lease associated with our McClelland Lake Lodge in Alberta, Canada, which expired in June 2023, in order to support our customer’s intent to mine the land where the lodge was located.
Price volatility may cause the average price at which we repurchase our common shares (see Note 17 – Share Repurchase Programs and Dividends for a discussion of repurchases of our common shares) in a given period to exceed the share price at a given point in time.
Price volatility may cause the average price at which we repurchase our common shares (see Note 16 – Share Repurchase Programs and Dividends for a discussion of repurchases of our common shares) in a given period to exceed the share price at a given point in time.
Additional unionization efforts and new collective bargaining agreements also could materially increase our costs or limit our flexibility. Collective bargaining agreements in our Canadian operations have individual expiration dates, but in no case extend beyond 2026.
Additional unionization efforts and new collective bargaining agreements also could materially increase our costs or limit our flexibility. Collective bargaining agreements in our Canadian operations have individual expiration dates, but in no case extend beyond 2028.
Climate change and other ESG-related matters are receiving increasing attention from the media, scientists and legislators alike, which has resulted in legislative, regulatory and other initiatives, including international agreements, to reduce greenhouse gas emissions, such as carbon dioxide and methane, and proposed regulations to increase climate change reporting obligations.
Climate change and other ESG-related matters are receiving increasing attention from the media, scientists and legislators alike, which has resulted in legislative, regulatory and other initiatives, including international agreements, to reduce GHG emissions, such as carbon dioxide and methane, and proposed regulations to increase climate change reporting obligations.
Other factors beyond our control that affect commodity prices include: • worldwide economic activity including growth in and demand for oil, coal and other natural resources, particularly from developing countries, such as China and India; • the level of activity, spending and natural resource developments in Australia and Canada; • the level of global oil and gas exploration and production and the impact of government regulation or Organization of the Petroleum Exporting Countries Plus (OPEC+) policies that impact production levels and oil prices; • the availability of transportation infrastructure and refining capacity for oil, natural gas, LNG and coal; • global weather conditions, natural disasters and global health concerns; 25 • geopolitical events such as the ongoing Russia/Ukraine and Israel/Hamas conflicts; • global reduction in demand for fossil fuels due to international efforts to address climate change; • rapid technological change and the timing and extent of energy resource development, including hydraulic fracturing of horizontally drilled wells in shale discoveries and LNG; • development, commercialization, availability and economics of alternative fuels; and • government, tax and environmental regulation, including climate change legislation and clean energy policies.
Other factors beyond our control that affect commodity prices include: • worldwide economic activity including growth in and demand for coal, oil and other natural resources, particularly from developing countries, such as China and India; • the level of activity, spending and natural resource developments in Australia and Canada; • the level of global oil and gas exploration and production and the impact of government regulation or Organization of the Petroleum Exporting Countries Plus (OPEC+) policies that impact production levels and oil prices; • the availability of transportation infrastructure and refining capacity for oil, natural gas, LNG and coal; • global weather conditions, natural disasters and global health concerns; • geopolitical events such as the ongoing Russia/Ukraine and Middle East conflicts; 23 • the impact on global demand for fossil fuels due to international efforts to address climate change; • rapid technological change and the timing and extent of energy resource development, including hydraulic fracturing of horizontally drilled wells in shale discoveries and LNG; • development, commercialization, availability and economics of alternative fuels; and • government, tax and environmental regulation, including climate change legislation and clean energy policies.
Enterprise bargaining agreements in our Australian operations cover certain employees working at our villages in Queensland, New South Wales and Western Australia, as well as certain employees working at our integrated services customer-owned sites in Western Australia and South Australia.
Enterprise bargaining agreements in our Australian operations cover certain employees working at our villages in Queensland, New South Wales and Western Australia, as well as certain employees working at our integrated services sites in Western Australia.
Continued volatility in commodity price levels, any future global health crises, inflationary pressures, actions taken by OPEC+ to adjust production levels, geopolitical events such as the ongoing Russia/Ukraine and Israel/Hamas conflicts, and regulatory implications on such prices, among other factors, could cause our Canadian oil sands and pipeline customers to reduce production, delay expansionary and maintenance spending and defer additional investments in their oil sands assets, which would cause a decrease in customer demand for our accommodations.
Volatility in commodity price levels, any future global health crises, inflationary pressures, actions taken by OPEC+ to adjust production levels, geopolitical events such as the ongoing Russia/Ukraine and Middle East conflicts, and regulatory implications on such prices, among other factors, could cause our Canadian oil sands and pipeline customers to reduce production, delay expansionary and maintenance spending and defer additional investments in their oil sands assets, which would cause a decrease in customer demand for our accommodations.
The economic analyses conducted by our customers in Canadian oil sands, Australian mining and global liquefied natural gas (LNG) investment areas have historically assumed a relatively conservative longer-term price outlook for production from such projects to determine economic viability.
The economic analyses conducted by our customers in Australian mining, Canadian oil sands and global LNG investment areas have historically assumed a relatively conservative longer-term price outlook for production from such projects to determine economic viability.
Operating risks and challenges our customers face, which may ultimately affect their need for the accommodations and services we provide, include: • commodity price volatility; • unforeseen and adverse geological, geotechnical, seismic and mining conditions; • lack of availability or failure of the required infrastructure, including sourcing sufficient water or power, necessary to maintain or to expand their operations; • the breakdown or shortage of equipment and labor necessary to maintain their operations; • capital project cost overruns and cost inflation; • risks associated with the natural resources industry being subject to laws and regulations, including those governing air and greenhouse gas emissions, as well as various regulatory approvals, including a government agency failing to grant an approval or failing to renew an existing approval, or the approval or renewal not being provided by the government agency in a timely manner or the government agency granting or renewing an approval subject to materially onerous conditions; • risks to land titles, mining titles and use thereof as a result of native title claims; • claims by persons living in close proximity to mining projects, which may have an impact on the consents granted; and • interruptions to the operations of our customers caused by governmental action, industrial accidents, disputes or public health emergencies. 26 We depend on several significant customers.
Operating risks and challenges our customers face, which may ultimately affect their need for the accommodations and services we provide, include: • commodity price volatility; • unforeseen and adverse geological, geotechnical, seismic and mining conditions; • lack of availability or failure of the required infrastructure, including sourcing sufficient water or power, necessary to maintain or to expand their operations; • the breakdown or shortage of equipment and labor necessary to maintain their operations; • capital project cost overruns and cost inflation; • risks associated with the natural resources industry being subject to laws and regulations, including those governing air and GHG emissions, as well as various regulatory approvals, including a government agency failing to grant an approval or failing to renew an existing approval, or the approval or renewal not being provided by the government agency in a timely manner or the government agency granting or renewing an approval subject to materially onerous conditions; • risks to land titles, mining titles and use thereof as a result of native title claims; • claims by persons living in close proximity to mining projects, which may have an impact on the consents granted; • interruptions to the operations of our customers caused by governmental action, industrial accidents, disputes or public health emergencies; and • reduce operating costs to increase profitability.
The extent to which our business operations and financial results may be affected by such public health crises, pandemics and epidemics depends on various factors beyond our control, such as the duration, severity and sustained geographic impact of the outbreak; the impact and effectiveness of governmental actions to contain and treat such outbreaks, including government policies and restrictions; vaccine hesitancy, vaccine mandates, and voluntary or mandatory quarantines; and the global response surrounding such uncertainties.
The extent to which our business operations and financial results may be affected by such public health crises, pandemics and epidemics depends on various factors beyond our control, such as the duration, severity and sustained geographic impact of the outbreak; the impact and effectiveness of governmental actions to contain and treat such outbreaks, including government policies and restrictions; the availability of effective vaccines and other treatments; vaccine hesitancy, vaccine mandates, and voluntary or mandatory quarantines; and the global response surrounding such uncertainties.
There are a number of legislative and regulatory proposals to address greenhouse gas emissions, including increased fuel efficiency standards, carbon taxes or cap and trade systems, restrictive permitting, and incentives for renewable energy, which are in various phases of discussion or implementation. Moreover, such legislation, regulations and proposals are subject to frequent 34 change by regulatory authorities.
There are a number of legislative and regulatory proposals to address GHG emissions, including increased fuel efficiency standards, carbon taxes or cap and trade systems, restrictive permitting and incentives for renewable energy, which are in various phases of discussion or implementation. Moreover, such legislation, regulations and proposals are subject to frequent change by regulatory authorities.
Canada’s tax rules under the Income Tax Act (Canada) (the Canadian Tax Act) allow for favorable tax treatment related to the repatriation of certain dividends from foreign affiliates.
Generally, Canada’s tax rules under the Income Tax Act (Canada) (the Canadian Tax Act) may allow for favorable tax treatment related to the repatriation of certain dividends from certain foreign affiliates.
The extent and duration of the effect of these labor market challenges are subject to numerous factors, including geopolitical events such as the ongoing Russia/Ukraine and Israel/Hamas conflicts, availability of qualified persons in the markets where we and our contracted service providers operate, inflation and unemployment levels within these markets and our reputation within the labor market.
The extent and duration of the effect of these labor market challenges are subject to numerous factors, including geopolitical events such as the ongoing Russia/Ukraine and Middle East conflicts, availability of qualified persons in the markets where we and our contracted service providers operate, inflation and unemployment levels within these markets and our reputation within the labor market.
Furthermore, members of the investment community, as well as political advocacy groups, are increasing their focus on ESG practices and disclosures by public companies, and concerns over climate change have resulted in, and are expected to continue to result in, the adoption of regulatory requirements for climate-related disclosures.
Furthermore, many members of the investment community, as well as political advocacy groups, are increasing their focus on ESG practices and disclosures by public companies, and concerns over climate change have resulted in, and are expected to continue to result in, the adoption of regulatory requirements 33 relating to climate-related disclosures.
Risk Factors: Risks Related to Our Macroeconomic Business Environment Certain of our customers’ spending may be directly, and our business may be indirectly, affected by (i) volatile or low oil, metallurgical (met) coal, natural gas or iron ore prices; (ii) increasing production costs; or (iii) unsuccessful exploration results.
Risk Factors: Risks Related to Our Customers Certain of our customers’ spending may be directly, and our business may be indirectly, affected by (i) volatile or low met coal, oil, natural gas or iron ore prices; (ii) elevated or increasing production costs; or (iii) unsuccessful exploration results.
Inefficient operations or further increased labor costs resulting from these labor market challenges could negatively impact our profitability and could damage our reputation with our customers. Additionally, as of December 31, 2023, we were party to collective bargaining agreements covering 798 employees in Canada and 1,020 employees in Australia.
Inefficient operations or further increased labor costs resulting from these labor market challenges could negatively impact our profitability and could damage our reputation with our customers. Additionally, as of December 31, 2024, we were party to collective bargaining agreements covering 480 employees in Canada and 1,401 employees in Australia.
The cyclical nature of our business and a severe prolonged downturn has, and could in the future, negatively affect the value of our long-lived assets and our goodwill. We recorded impairments of our long-lived assets of $1.4 million, $5.7 million and $7.9 million in 2023, 2022 and 2021, respectively.
The cyclical nature of our business and a severe prolonged downturn has, and could in the future, negatively affect the value of our long-lived assets and our goodwill. We recorded impairments of our long-lived assets of $11.6 million, $1.4 million and $5.7 million in 2024, 2023 and 2022, respectively.
For the year ended December 31, 2023, 98% of our revenues originated from subsidiaries outside of the U.S. and were denominated in either the Canadian dollar or the Australian dollar.
For the year ended December 31, 2024, 99% of our revenues originated from subsidiaries outside of the U.S. and were denominated in either the Australian dollar or the Canadian dollar.
A significant portion of our revenue is attributable to operations in Canada and Australia. These activities accounted for 98% of our consolidated revenue in the year ended December 31, 2023.
A significant portion of our revenue is attributable to operations in Australia and Canada. These activities accounted for 99% of our consolidated revenue in the year ended December 31, 2024.
For example, we have recently been impacted by increased staff costs as a result of hospitality labor shortages in Australia due to low levels of immigration into Australia and, specifically, an acute shortage of skilled labor.
For example, within the past few years we have been impacted by increased staff costs as a result of hospitality labor shortages in Australia due to low levels of immigration into Australia and, specifically, an acute shortage of skilled labor.
Provisions contained in our articles provide for a classified Board, limitations on the removal of directors, limitations on shareholder proposals at meetings of shareholders and limitations on shareholder action by written consent, which could make it more difficult for a third-party to acquire control of us.
Provisions contained in our articles provide for a classified Board (which will be phased out by the 2027 annual general meeting of shareholders), limitations on the removal of directors, limitations on shareholder proposals at meetings of shareholders and limitations on shareholder action by written consent, which could make it more difficult for a third-party to acquire control of us.
As of December 31, 2023, goodwill at our Australian reporting unit represented 1% of total assets, or $7.7 million.
As of December 31, 2024, goodwill at our Australian reporting unit represented 2% of total assets, or $7.0 million.
During the Australian rainy season, generally between the months of November and April, our operations in Queensland and the northern parts of Western Australia can be affected by cyclones, monsoons and resultant flooding. Additionally, the areas in which we operate are susceptible to wildfires.
During the Australian rainy season, generally between the months of November and April, our operations in Queensland and the northern parts of Western Australia can be affected by cyclones, monsoons and resultant flooding.
Factors that may cause us to recognize further impairment losses on our long-lived assets or on the goodwill at our Australian reporting unit include, among other things, extended periods of limited or no activity by our customers at our lodges or villages, increased or unanticipated competition, and downward forecast revisions or restructuring plans or if certain of our customers do not reach positive final investment decisions on projects with respect to which we have been awarded contracts to provide related accommodation, which may cause those customers to terminate the contracts. 32 Our inability to control the inherent risks of identifying, acquiring and integrating businesses that we may acquire, including any related increases in debt or issuances of equity securities, could adversely affect our operations.
Factors that may cause us to recognize further impairment losses on our long-lived assets or on the goodwill at our Australian reporting unit include, among other things, extended periods of limited or no activity by our customers at our lodges or villages, increased or unanticipated competition, and downward forecast revisions or restructuring plans or if certain of our customers do not reach positive final investment decisions on projects with respect to which we have been awarded contracts to provide related accommodation, which may cause those customers to terminate the contracts.
We may be subject to risks associated with the transportation, installation and demobilization of mobile accommodations. We currently have several contracts to transport and install modular, skid-mounted accommodations and central facilities that can be quickly configured to serve a multitude of short- to medium-term accommodation needs.
We currently have several contracts to transport and install modular, skid-mounted accommodations and central facilities that can be quickly configured to serve a multitude of short- to medium-term accommodation needs.
In addition, labor unions representing customer employees and contractors have, in the past, opposed outsourcing accommodations to the extent that the unions believe that third-party accommodations negatively impact union membership and recruiting. The reversal or reduction in customer outsourcing of accommodations could negatively impact our financial results and growth prospects.
In addition, labor unions representing customer employees and contractors have, in the past, opposed outsourcing accommodations to the extent that the unions believe that third-party accommodations negatively impact union membership and recruiting.
As of December 31, 2023, we had approximately $65.6 million outstanding under the revolving portion of our Syndicated Facility Agreement (Credit Agreement), $1.4 million of outstanding letters of credit and an additional $133.1 million in remaining capacity to borrow under the revolving portion of the Credit Agreement.
As of December 31, 2024, we had approximately $43.3 million outstanding under the revolving portion of our Syndicated Facility Agreement (as then amended to date, the Credit Agreement), $1.1 million of outstanding letters of credit and an additional $197.0 million in remaining capacity to borrow under the revolving portion of the Credit Agreement.
Consistent with U.S. generally accepted accounting principles, this liability is the estimated present value of the amount of required asset removal and site remediation costs related to the retirement of assets at this location in 2023. As of December 31, 2023, we had other ARO liabilities on our balance sheet of $16.2 million.
As of December 31, 2024, we had asset retirement obligation liabilities on our balance sheet of $14.1 million. Consistent with U.S. generally accepted accounting principles, these liabilities are the estimated present value of the amount of required asset removal and site remediation costs related to the retirement of assets.
Although we utilize various procedures and controls to monitor these threats and mitigate our exposure to such threats, including cybersecurity insurance, there can be no assurance that these procedures and controls will be sufficient in preventing security threats from materializing.
Although we utilize various procedures and controls to monitor these threats and mitigate our exposure to such threats, including cybersecurity insurance, there can be no assurance that these procedures and controls will be sufficient in preventing security threats from materializing, including attempts to gain unauthorized access to sensitive information or to render data or systems unusable or hold them for ransom.
Many natural resources companies in our core markets own their own accommodations facilities and outsource their service requirements, while others outsource all or part of their accommodations requirements.
These competitors offer similar services in the geographic regions in which we operate. Many natural resources companies in our core markets own their own accommodations facilities and outsource their service requirements, while others outsource all or part of their accommodations requirements.
An inability to realize expected strategic advantages as a result of the acquisition would negatively affect the anticipated benefits of the acquisition. Additionally, an acquisition may bring us into businesses we have not previously conducted or geographies in which we have not previously operated and expose us to additional business risks that are different from those we have previously experienced.
Additionally, an acquisition may bring us into businesses we have not previously conducted or geographies in which we have not previously operated and expose us to additional business risks that are different from those we have previously experienced.
Canada has also introduced tax rules governing “foreign affiliate dumping” in the Canadian Tax Act that can have adverse tax consequences in respect of non-Canadian business activities and investments for Canadian corporations that are controlled by non-Canadian corporations. These rules would have a negative impact on us to the extent that we became controlled by a non-Canadian resident corporation.
Canada has also introduced tax rules governing “foreign affiliate dumping” in the Canadian Tax Act that can have adverse tax consequences in respect of non-Canadian business activities and investments for Canadian corporations that are controlled by a non-Canadian person or group of non-Canadian persons.
While our multi-year contracts often provide for annual escalation in our room rates for food, labor and utility inflation, we may be unable to fully recover costs, or the recovery may be delayed, and such increases would negatively impact our profitability on contracts that do not contain such inflation protections. Employee and customer labor problems could adversely affect us.
While our multi-year contracts often provide for annual escalation in our room rates for food, labor and utility inflation, we may be unable to fully recover costs, or the recovery may be delayed, and such increases would negatively impact our profitability on contracts that do not contain such inflation protections. 26 Further, the U.S. and other countries from time to time may impose tariffs that affect the goods or raw materials we or our customers use or the products our customers provide.
Revenues associated with the 2023 room commitments at the lodge through July 2023 were approximately C$39 million. Customer contract cancellations, reduced customer utilization, the failure to renew a significant number of our existing contracts or the failure to obtain new business would have a material adverse effect on our business and results of operations.
Customer contract cancellations, reduced customer utilization, the failure to renew a significant number of our existing contracts or the failure to obtain new business would have a material adverse effect on our business and results of operations.
Development of permanent infrastructure in the areas where we locate our assets could negatively impact our business. We specialize in providing hospitality services for workforces in remote areas which often lack the infrastructure typically available in nearby towns and cities.
We specialize in providing hospitality services for workforces in remote areas which often lack the infrastructure typically available in nearby towns and cities.
As of February 23, 2024, the West Texas Intermediate (WTI) price was $77.54 and the Western Canadian Select (WCS) price was $58.60, resulting in a discount (WCS Differential) at which WCS trades relative to WTI of $18.94.
As of February 21, 2025, the West Texas Intermediate (WTI) price was $70.58 and the Western Canadian Select (WCS) price was $57.24, resulting in a discount (WCS Differential) at which WCS trades relative to WTI of $13.34.
As a result, our realized effective tax rate may be materially different from our current expectation. Our provision for income taxes will be based on certain estimates and assumptions made by management in consultation with our tax and other advisors.
Our provision for income taxes will be based on certain estimates and assumptions made by management in consultation with our tax and other advisors.
As a result, the tax laws in the U.S. and other countries in which we and our affiliates do business could change on a prospective or retroactive basis (or both), and any such changes could materially adversely affect us.
The tax laws of countries in which we and our affiliates do business have already begun to change based on this two-pillar plan and could change further on a prospective or retroactive basis (or both), and any such changes could materially adversely affect us.
The principal competitive factors in the markets in which we operate are service quality, availability, price, location, technical knowledge and experience and safety performance. We compete with international and regional competitors, several of which are significantly larger than us. These competitors offer similar services in the geographic regions in which we operate.
To be successful, we must provide hospitality services that meet the specific needs of our customers at competitive prices. The principal competitive factors in the markets in which we operate are service quality, availability, price, location, technical knowledge and experience and safety performance. We compete with international and regional competitors, several of which are significantly larger than us.
While inflation has stabilized, and while we have been able to pass some of the increased costs onto our customers, we expect to continue to experience increases in our food costs from time to time due to increasing fuel prices, rising global food demand, other general inflationary pressures and rising supply chain issues affecting supply of goods.
Over the past few years, we experienced, and may continue to experience, increases in our food costs from time to time due to increasing fuel prices, rising global food demand, other general inflationary pressures and rising supply chain issues affecting supply of goods.
Failure to maintain positive relationships with the Indigenous people in the areas where we operate could adversely affect our business. 30 A component of our business strategy is based on developing and maintaining positive relationships with the Indigenous people and communities in the areas where we operate.
A component of our business strategy is based on developing and maintaining positive relationships with the Indigenous people and communities in the areas where we operate. These relationships are important to our operations and our customers who desire to work on traditional Indigenous lands.
Acquisitions have been, and our management believes acquisitions will continue to be, a key element of our growth strategy. We may not be able to identify and acquire acceptable acquisition candidates on favorable terms in the future. We may be required to incur substantial indebtedness to finance future acquisitions and also may issue equity securities in connection with such acquisitions.
We may not be able to identify and acquire acceptable acquisition candidates on favorable terms in the future. We may be required to incur substantial indebtedness to finance future acquisitions and also may issue equity securities in connection with such acquisitions. Such additional debt service requirements could impose a significant burden on our results of operations and financial condition.
Additionally, members of the investment community may screen our ESG disclosures and performance before investing in our common shares. See Item 1. “Business - Government Regulation” of this annual report for a more detailed description of our climate-change related risks. Risks Related to Our Common Shares The market price and trading volume of our common shares may be volatile.
“Business - Government Regulation” of this annual report for a more detailed description of our climate-change related risks. Risks Related to Our Common Shares The market price and trading volume of our common shares may be volatile. The market price of our common shares has historically experienced and may continue to experience volatility.
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Item 1C. Cybersecurity
Cybersecurity — threats and controls disclosure
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Item 1C. Cybersecurity
Cybersecurity — threats and controls disclosure
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2023 filing
2024 filing
Biggest changeLocation Approximate Square Footage/Acreage Description Canada: Fort McMurray, Alberta (leased land) 240 acres Wapasu Creek Lodge Fort McMurray, Alberta (leased land) 138 acres Fort McMurray Village Fort McMurray, Alberta (leased land) 135 acres Conklin Lodge Fort McMurray, Alberta (leased land) 128 acres Beaver River and Athabasca Lodges Kitimat, British Columbia 59 acres Sitka Lodge Fort McMurray, Alberta (leased land and lodges) 58 acres Hudson and Borealis Lodges Acheson, Alberta (lease) 40 acres Office and warehouse Vanderhoof, British Columbia 33 acres Storage yard Fort McMurray, Alberta (leased land) 30 acres Greywolf Lodge Fort McMurray, Alberta (leased land) 18 acres Anzac Lodge Edmonton, Alberta (lease) 86,376 sq. feet Office and commercial production kitchen Calgary, Alberta (lease) 7,000 sq. feet Office Australia: Coppabella, Queensland, Australia 192 acres Coppabella Village Narrabri, New South Wales, Australia 82 acres Narrabri Village Boggabri, New South Wales, Australia 52 acres Boggabri Village Dysart, Queensland, Australia 50 acres Dysart Village Middlemount, Queensland, Australia 37 acres Middlemount Village Karratha, Western Australia, Australia (owned and leased land) 34 acres Karratha Village Nebo, Queensland, Australia 26 acres Nebo Village Moranbah, Queensland, Australia 17 acres Moranbah Village Sydney, New South Wales, Australia (lease) 11,518 sq. feet Office Perth, Western Australia, Australia (lease) 6,921 sq. feet Office Brisbane, Queensland, Australia (lease) 5,543 sq. feet Office U.S.: Houston, Texas (lease) 8,900 sq. feet Principal executive offices Sulphur, Louisiana 44 acres Acadian Acres land only Killdeer, North Dakota 39 acres Killdeer Lodge We also own various undeveloped properties in British Columbia.
Biggest changeFor a discussion about how each of our business segments utilizes its respective properties, see Item 1, “Business” of this annual report. 38 Location Approximate Square Footage/Acreage Description Australia: Coppabella, Queensland, Australia 192 acres Coppabella Village Narrabri, New South Wales, Australia 82 acres Narrabri Village Boggabri, New South Wales, Australia 52 acres Boggabri Village Dysart, Queensland, Australia 50 acres Dysart Village Middlemount, Queensland, Australia 37 acres Middlemount Village Nebo, Queensland, Australia 26 acres Nebo Village Moranbah, Queensland, Australia 17 acres Moranbah Village Karratha, Western Australia, Australia 11 acres Karratha Village Sydney, New South Wales, Australia (lease) 11,518 sq. feet Office Perth, Western Australia, Australia (lease) 6,921 sq. feet Office Brisbane, Queensland, Australia (lease) 5,543 sq. feet Office Canada: Fort McMurray, Alberta (leased land) 240 acres Wapasu Creek Lodge Fort McMurray, Alberta (leased land) 138 acres Fort McMurray Village Fort McMurray, Alberta (leased land) 135 acres Conklin Lodge Fort McMurray, Alberta (leased land) 128 acres Beaver River and Athabasca Lodges Kitimat, British Columbia 59 acres Sitka Lodge Fort McMurray, Alberta (leased land and lodges) 58 acres Hudson and Borealis Lodges Acheson, Alberta (lease) 40 acres Office and warehouse Vanderhoof, British Columbia 33 acres Storage yard Fort McMurray, Alberta (leased land) 30 acres Greywolf Lodge Fort McMurray, Alberta (leased land) 18 acres Anzac Lodge Edmonton, Alberta (lease) 86,376 sq. feet Office and commercial production kitchen Calgary, Alberta (lease) 7,000 sq. feet Office U.S.: Houston, Texas (lease) 8,900 sq. feet Principal executive offices Killdeer, North Dakota 39 acres Killdeer Lodge We also own various undeveloped properties in British Columbia.
LNG Canada (LNGC), a joint venture among Shell Canada Energy, an affiliate of Shell plc (40 percent), and affiliates of PETRONAS, through its wholly-owned entity, North Montney LNG Limited Partnership (25 percent), PetroChina (15 percent), Mitsubishi Corporation (15 percent) and Korea Gas Corporation (5 percent), is currently constructing a liquefaction and export facility in Kitimat, British Columbia (Kitimat LNG Facility).
LNGC, a joint venture among Shell Canada Energy, an affiliate of Shell plc (40 percent), and affiliates of PETRONAS, through its wholly-owned entity, North Montney LNG Limited Partnership (25 percent), PetroChina (15 percent), Mitsubishi Corporation (15 percent) and Korea Gas Corporation (5 percent), is currently constructing a liquefaction and export facility in Kitimat, British Columbia (Kitimat LNG Facility).
Capital Expenditures. We continue to monitor the global economy, commodity prices, demand for crude oil, met coal, LNG and iron ore, inflation and the resultant impact on the capital spending plans of our customers in order to plan our business activities.
Capital Expenditures. We continue to monitor the global economy, commodity prices, demand for met coal, crude oil, LNG and iron ore, inflation and the resultant impact on the capital spending plans of our customers in order to plan our business activities.
The declaration and amount of all potential future dividends will be at the discretion of our Board and will depend upon many factors, including our financial condition, results of operations, cash flows, prospects, industry conditions, capital requirements of our business, covenants associated with certain debt obligations, legal requirements, regulatory constraints, industry practice and other factors the Board deems relevant.
The declaration and amount of all potential future dividends will be at the discretion of our Board and will depend upon many factors, including our financial condition, results of operations, cash flows, prospects, industry conditions, capital requirements of our business, covenants associated with certain debt obligations, legal requirements, regulatory constraints, industry practice and other factors the Board deems relevant.
In addition, our ability to pay cash dividends on common shares is limited by covenants in the Credit Agreement. Future agreements may also limit our ability to pay dividends, and we may incur incremental taxes if we are required to repatriate foreign earnings to pay such dividends.
In addition, our ability to pay cash dividends on common shares is limited by covenants in the Credit Agreement. Future agreements may also limit our ability to pay dividends, and we may incur incremental taxes if we are required to repatriate foreign earnings to pay such dividends.
The amount per share of our dividend payments may be changed, or dividends may be suspended, without advance notice. The likelihood that dividends will be reduced or suspended is increased during periods of market weakness. There can be no assurance that we will continue to pay a dividend in the future.
The amount per share of our dividend payments may be changed, or dividends may be suspended, without advance notice. The likelihood that dividends will be reduced or suspended is increased during periods of market weakness. There can be no assurance that we will continue to pay a dividend in the future.
Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of management and our directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.
Our internal control over financial reporting includes 58 those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of management and our directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.
In addition, the accompanying hospitality services contract at McClelland Lake Lodge expired in July 2023; however, we continued to provide hospitality services to the customer at our other owned lodges through January 31, 2024 under a short-term take-or-pay commitment.
In addition, the accompanying hospitality services contract at McClelland Lake Lodge expired in July 2023; however, 46 we continued to provide hospitality services to the customer at our other owned lodges through January 31, 2024, under a short-term take-or-pay commitment.
(2) Includes revenues related to mobile assets for the periods presented. (3) Includes revenues related to food service, laundry and water and wastewater treatment services for the periods presented. (4) Average daily rate is based on billed rooms and accommodation revenue. (5) Billed rooms represents total billed days for owned assets for the periods presented.
(2) Includes revenues related to mobile assets for the periods presented. (3) Includes revenues related to food service, laundry and water and wastewater treatment services for the periods presented. (4) Average daily rate is based on billed rooms and accommodation and other services revenue. (5) Billed rooms represents total billed days for owned assets for the periods presented.
See “ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” in Item 7 and Note 11 – Debt to the notes to consolidated financial statements included in Item 8 of this annual report for additional information 39 concerning our credit facilities.
See “ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” in Item 7 and Note 11 – Debt to the notes to consolidated financial statements included in Item 8 of this annual report for additional information concerning our credit facilities.
As a result, demand for our hospitality services is largely sensitive to expected commodity prices, principally related to oil, met coal, LNG and iron ore, and the resultant impact of these commodity price expectations on our customers’ spending.
As a result, demand for our hospitality services is sensitive to expected commodity prices, principally related to met coal, oil, iron ore and LNG, and the resultant impact of these commodity price expectations on our customers’ spending.
If our plans or assumptions change, including as a result of changes in our customers' capital spending or changes in the price of and demand for natural resources, or are inaccurate, or if we make acquisitions, we may need to raise additional capital.
If our plans or assumptions change, including as a result of changes in our customers' capital spending or changes in the price of and demand for natural resources, or are inaccurate, or if we make acquisitions, we may need to raise 53 additional capital.
Our ability to obtain capital for additional projects to implement 55 our growth strategy over the longer term will depend on our future operating performance, financial condition and, more broadly, on the availability of equity and debt financing.
Our ability to obtain capital for additional projects to implement our growth strategy over the longer term will depend on our future operating performance, financial condition and, more broadly, on the availability of equity and debt financing.
We did not renew an expiring land lease associated with our McClelland Lake Lodge in Alberta, Canada, which expired in June 2023, in order to support our customer’s intent to mine the land where the lodge was located.
We did not renew our expiring land lease associated with our McClelland Lake Lodge in Alberta, Canada, which expired in June 2023, in order to support our customer’s intent to mine the land where the lodge was located.
These properties are grouped in the following asset groups: • Karratha – Pilbara Region, Western Australia • Integrated services – Assets held on client owned sites in Western Australia and South Australia • Gunnedah Basin ◦ Narrabri – Gunnedah Basin, New South Wales ◦ Boggabri – Gunnedah Basin, New South Wales • Bowen Basin ◦ Moranbah – Bowen Basin, Queensland 57 ◦ Dysart – Bowen Basin, Queensland ◦ Nebo – Bowen Basin, Queensland ◦ Coppabella – Bowen Basin, Queensland ◦ Middlemount – Bowen Basin, Queensland • Various non-operational sites acquired as part of Civeo’s land-banking strategy In general, the villages are operated on a village by village basis, except for the villages located in the Bowen Basin (Moranbah, Dysart, Nebo, Coppabella and Middlemount) and the Gunnedah Basin (Narrabri and Boggabri).
These properties are grouped in the following asset groups: • Karratha – Pilbara Region, Western Australia • Integrated services – Assets held on client owned sites in Western Australia and South Australia • Gunnedah Basin ◦ Narrabri – Gunnedah Basin, New South Wales ◦ Boggabri – Gunnedah Basin, New South Wales • Bowen Basin ◦ Moranbah – Bowen Basin, Queensland 55 ◦ Dysart – Bowen Basin, Queensland ◦ Nebo – Bowen Basin, Queensland ◦ Coppabella – Bowen Basin, Queensland ◦ Middlemount – Bowen Basin, Queensland • Various non-operational sites acquired as part of Civeo’s land-banking strategy In general, the villages are operated on a village by village basis, except for the villages located in the Bowen Basin (Moranbah, Dysart, Nebo, Coppabella and Middlemount) and the Gunnedah Basin (Narrabri and Boggabri).
We describe our significant accounting policies more fully in Note 2 - Summary of Significant Accounting Policies to the notes to consolidated financial statements in Item 8 of this annual report. 56 Impairment of Definite-Lived Tangible and Intangible Assets The recoverability of the carrying values of tangible and intangible assets is assessed at an asset group level which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.
We describe our significant accounting policies more fully in Note 2 - Summary of Significant Accounting Policies to the notes to consolidated financial statements in Item 8 of this annual report. 54 Impairment of Definite-Lived Tangible and Intangible Assets The recoverability of the carrying values of tangible and intangible assets is assessed at an asset group level which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.
Other factors that can affect our business and financial results include the general global economic environment, including inflationary pressures, supply chain disruptions and labor shortages, volatility affecting the banking system and financial markets, availability of capital to the natural resource industry and regulatory changes in Canada, Australia and other markets, including governmental measures introduced to fight climate change.
Other factors that can affect our business and financial results include the general global economic environment, including inflationary pressures, supply chain disruptions and labor shortages, volatility affecting the banking system and financial markets, availability of capital to the natural resource industry and regulatory changes in Canada, Australia and other markets, including governmental measures introduced to mitigate climate change.
In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control–Integrated Framework (2013 Framework). Based on our assessment we believe that, as of December 31, 2023, our internal control over financial reporting is effective based on those criteria. (b) Attestation report of the registered public accounting firm.
In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control–Integrated Framework (2013 Framework). Based on our assessment we believe that, as of December 31, 2024, our internal control over financial reporting is effective based on those criteria. (b) Attestation report of the registered public accounting firm.
During the three months ended December 31, 2023, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. Other Information None. ITEM 9C.
During the three months ended December 31, 2024, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. Other Information None. ITEM 9C.
The graph and chart show the value, at the dates indicated, of $100 invested at December 31, 2018 and assume the reinvestment of all dividends, as applicable. Our peer group consists of the following: Badger Daylighting Ltd. Nine Energy Service, Inc. Black Diamond Group Limited North American Construction Group Dexterra Group Oil States International, Inc. Enerflex Ltd.
The graph and chart show the value, at the dates indicated, of $100 invested at December 31, 2019 and assume the reinvestment of all dividends, as applicable. Our peer group consists of the following: Badger Daylighting Ltd. Nine Energy Service, Inc. Black Diamond Group Limited North American Construction Group Dexterra Group Inc. Oil States International, Inc. Enerflex Ltd.
You should read the following discussion and analysis together with our consolidated financial statements and the notes to those statements in Item 8 of this annual report. This section of this annual report generally discusses key operating and financial data as of and for the years ended 2023 and 2022 and provides year-over-year comparisons for such periods.
You should read the following discussion and analysis together with our consolidated financial statements and the notes to those statements in Item 8 of this annual report. This section of this annual report generally discusses key operating and financial data as of and for the years ended 2024 and 2023 and provides year-over-year comparisons for such periods.
Accordingly, even effective internal control over financial reporting can only provide reasonable assurance of achieving their control objectives. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2023 was conducted.
Accordingly, even effective internal control over financial reporting can only provide reasonable assurance of achieving their control objectives. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2024 was conducted.
Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters The information required by Item 12 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2024 Annual General Meeting of Shareholders. ITEM 13.
Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters The information required by Item 12 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2025 Annual General Meeting of Shareholders. ITEM 13.
During 2022 and 2023, inflationary pressures and supply chain disruptions have been, and continue to be, experienced worldwide. Price increases resulting from inflation and supply chain concerns have, and are expected to continue to have, a negative impact on our labor and food costs, as well as consumable costs such as fuel.
During 2023 and 2024, inflationary pressures and supply chain disruptions have been, and continue to be, experienced worldwide. Price increases resulting from inflation and supply chain concerns have, and are expected to continue to have, a negative impact on our labor and food costs, as well as consumable costs such as fuel.
Although we can give no assurance about the outcome of pending legal and administrative proceedings and the effect such outcomes may have on us, we believe that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided for or covered by indemnity or insurance, will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.
Although we can give no assurance about the outcome of pending legal and administrative proceedings and the effect such outcomes may have on us, we believe that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided for or covered by indemnity or insurance, will not have a material adverse effect on our consolidated financial position, results of operations or liquidity. 39 ITEM 4.
In the second half of 2022 and throughout 2023, oil prices declined due to (i) rising fears of a recession resulting from severe inflation and rising interest rates, (ii) resulting lower demand for oil and (iii) increasing U.S. oil production.
In the second half of 2022 and throughout 2023, oil prices generally declined due to (i) rising fears of a recession resulting from severe inflation and higher interest rates, (ii) resulting lower demand for oil and (iii) increasing U.S. oil production.
Our business has historically derived the vast majority of its revenues and operating income in Canada and Australia. These revenues and profits/losses are translated into U.S. dollars for U.S. generally accepted accounting principles financial reporting purposes.
Our business has historically derived the vast majority of its revenues and operating income (loss) in Canada and Australia. These revenues and profits/losses are translated into U.S. dollars for financial reporting purposes under U.S. generally accepted accounting principles.
Our debt obligations at December 31, 2023 are reflected in our consolidated balance sheet, which is a part of our consolidated financial statements in Item 8 of this annual report. We have not entered into any material leases subsequent to December 31, 2023.
Our debt obligations at December 31, 2024 are reflected in our consolidated balance sheet, which is a part of our consolidated financial statements in Item 8 of this annual report. We have not entered into any material leases subsequent to December 31, 2024.
Certain Relationships and Related Transactions, and Director Independence The information required by Item 13 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2024 Annual General Meeting of Shareholders. ITEM 14.
Certain Relationships and Related Transactions, and Director Independence The information required by Item 13 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2025 Annual General Meeting of Shareholders. ITEM 14.
The attestation report of Ernst & Young LLP, our independent registered public accounting firm, on our internal control over financial reporting is set forth in this annual report on page 71 and is incorporated herein by reference. (c) Changes in internal control over financial reporting.
The attestation report of Ernst & Young LLP, our independent registered public accounting firm, on our internal control over financial reporting is set forth in this annual report on page 69 and is incorporated herein by reference. (c) Changes in internal control over financial reporting.
See Note 4 – Impairment Charges to the notes to consolidated financial statements in Item 8 of this annual report for further discussion of impairments of definite-lived tangible and intangible assets recorded in the years ended December 31, 2023, 2022 and 2021. 58 Revenue and Cost Recognition We generally recognize accommodation, mobile facility rental, food service and other services revenues over time as our customers simultaneously receive and consume benefits as we serve our customers because of continuous transfer of control to the customer.
See Note 4 – Impairment Charges to the notes to consolidated financial statements in Item 8 of this annual report for further discussion of impairments of definite-lived tangible and intangible assets recorded in the years ended December 31, 2024, 2023 and 2022. 56 Revenue and Cost Recognition We generally recognize accommodation, mobile facility rental, food service and other services revenues over time as our customers simultaneously receive and consume benefits as we serve our customers because of continuous transfer of control to the customer.
Executive Compensation The information required by Item 11 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2024 Annual General Meeting of Shareholders. ITEM 12.
Executive Compensation The information required by Item 11 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2025 Annual General Meeting of Shareholders. ITEM 12.
We also offer development activities for workforce accommodation facilities, including site selection, permitting, engineering and design, manufacturing management and site construction, along with providing hospitality services once the facility is constructed.
We also manage development activities for workforce accommodation facilities, including site selection, permitting, engineering and design and manufacturing and site construction management, along with providing hospitality services once the facility is constructed.
Critical Accounting Policies Our consolidated financial statements in Item 8 of this annual report have been prepared in accordance with U.S. GAAP, which require that management make numerous estimates and assumptions. Actual results could differ from those estimates and assumptions, thus impacting our reported results of operations and financial position.
Critical Accounting Policies and Estimates Our consolidated financial statements in Item 8 of this annual report have been prepared in accordance with U.S. generally accepted accounting principles (GAAP), which require that management make numerous estimates and assumptions. Actual results could differ from those estimates and assumptions, thus impacting our reported results of operations and financial position.
Whether planned expenditures will actually be spent in 2024 depends on industry conditions, project approvals and schedules, customer room commitments and project and construction timing. We expect to fund these capital expenditures with available cash, cash flow from operations and revolving credit borrowings under our Credit Agreement.
Whether planned expenditures will actually be spent in 2025 depends on industry conditions, project approvals and schedules, customer room commitments and project and construction timing. We expect to 52 fund these capital expenditures with available cash, cash flow from operations and revolving credit borrowings under our Credit Agreement.
These properties are grouped in the following asset groups: • Killdeer Lodge – North Dakota • Acadian Acres land – Louisiana • Killdeer WWTP – this asset group represents a WWTP in Killdeer, North Dakota, which was constructed in early 2014 Recoverability Assessment – In performing an impairment analysis, the second step is to compare each asset group’s carrying value to estimates of undiscounted future direct cash flows associated with the asset group over the remaining useful life of the asset group's primary asset.
These properties are grouped in the following asset groups: • Killdeer Lodge – North Dakota • Killdeer WWTP – this asset group represents a WWTP in Killdeer, North Dakota, which was constructed in early 2014 Recoverability Assessment – In performing an impairment analysis, the second step is to compare each asset group’s carrying value to estimates of undiscounted future direct cash flows associated with the asset group over the remaining useful life of the asset group's primary asset.
ITEM 4. Mine Safety Disclosures Not applicable. 41 PART II ITEM 5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Market for Our Common Shares Our common shares trade on the New York Stock Exchange under the trading symbol “CVEO”.
Mine Safety Disclosures Not applicable. 40 PART II ITEM 5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Market for Our Common Shares Our common shares trade on the New York Stock Exchange under the trading symbol “CVEO”.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 61 PART III ITEM 10. Directors, Executive Officers and Corporate Governance The information required by Item 10 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2024 Annual General Meeting of Shareholders.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 59 PART III ITEM 10. Directors, Executive Officers and Corporate Governance The information required by Item 10 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2025 Annual General Meeting of Shareholders.
In many cases, we provide services that support the day-to-day operations of these facilities, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics.
We provide services that support the day-to-day operations of these facilities, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics.
As of December 31, 2023, we had outstanding letters of credit of $0.3 million under the U.S. facility, zero under the Australian facility and $1.1 million under the Canadian facility. We also had outstanding bank guarantees of A$0.8 million under the Australian facility.
As of December 31, 2024, we had outstanding letters of credit of $0.3 million under the U.S. facility, zero under the Australian facility and $0.8 million under the Canadian facility. We also had outstanding bank guarantees of A$2.1 million under the Australian facility.
The performance graph is not soliciting material subject to Regulation 14A. Unregistered Sales of Equity Securities and Use of Proceeds None. 43 Repurchases of Registered Equity Securities by Registrant or its Affiliates in the Fourth Quarter The following table provides information about purchases of our common shares during the three months ended December 31, 2023.
The performance graph is not soliciting material subject to Regulation 14A. Unregistered Sales of Equity Securities and Use of Proceeds None. 42 Repurchases of Registered Equity Securities by Registrant or its Affiliates in the Fourth Quarter The following provides information about purchases of our common shares during the three months ended December 31, 2024.
The following performance graph and chart compare the cumulative total return to holders of our common shares with the cumulative total returns of the Standard & Poor's 500 Stock Index, Philadelphia OSX and with that of our peer group, for the period from December 31, 2018 to December 31, 2023.
The following performance graph and chart compare the cumulative total return to holders of our common shares with the cumulative total returns of the Standard & Poor's 500 Stock Index, Philadelphia OSX and with that of our peer group, for the period from December 31, 2019 to December 31, 2024.
Principal Accounting Fees and Services The information required by Item 14 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2024 Annual General Meeting of Shareholders. 62 PART IV
Principal Accounting Fees and Services The information required by Item 14 hereby is incorporated by reference to such information as set forth in the Company's Definitive Proxy Statement for the 2025 Annual General Meeting of Shareholders. 60 PART IV
Holders of Record As of February 23, 2024, there were 21 holders of record of Civeo common shares. Dividend Information We intend to pay regular quarterly dividends on our common shares, with all future dividend payments subject to quarterly review and approval by our Board.
Holders of Record As of February 21, 2025, there were 21 holders of record of Civeo common shares. Dividend Information We intend to pay regular quarterly dividends on our common shares, with all future dividend payments subject to quarterly review and approval by our Board of Directors (Board).
See “Liquidity and Capital Resources ” below for further discussion of 2024 and 2023 capital expenditures. 48 Results of Operations Unless otherwise indicated, discussion of results for the year ended December 31, 2023 is based on a comparison with the corresponding period of 2022.
See “Liquidity and Capital Resources ” below for further discussion on 2025 and 2024 capital expenditures. 47 Results of Operations Unless otherwise indicated, discussion of results for the year ended December 31, 2024 is based on a comparison with the corresponding period of 2023.
The Company deploys a Security Operations Center team who monitor and escalate cybersecurity events. In the event of a cybersecurity incident, the CISO is equipped with an incident response plan, which is intended to mitigate the impact of the incident and includes long-term strategies for remediation and prevention of future incidents.
The Company deploys a Security Operations Center team who monitor and escalate cybersecurity events to the CISO. In the event of a cybersecurity incident, the Company maintains an incident response plan, which is intended to facilitate response, escalation, and mitigate the impact of the incident and includes long-term strategies for remediation and prevention of future incidents.
For a similar discussion and year-over-year comparisons to our 2021 results, refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission on March 1, 2023.
For a similar discussion and year-over-year comparisons to our 2022 results, refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 29, 2024.
Excluding intercompany balances, our Canadian dollar and Australian dollar functional currency net assets total approximately C$234 million and A$205 million, respectively, at December 31, 2023. We use a sensitivity analysis model to measure the impact of a 10% adverse movement of foreign currency exchange rates against the U.S. dollar.
Excluding intercompany balances, our Canadian dollar and Australian dollar functional currency net assets total approximately C$166 million and A$191 million, respectively, at December 31, 2024. We use a sensitivity analysis model to measure the impact of a 10% adverse movement of foreign currency exchange rates against the U.S. dollar.
Financial Statements and Supplementary Data Our Consolidated Financial Statements and supplementary data appear on pages 68 through 100 of this Annual Report on Form 10-K and are incorporated by reference into this Item 8. ITEM 9.
Financial Statements and Supplementary Data Our Consolidated Financial Statements and supplementary data appear on pages 66 through 99 of this Annual Report on Form 10-K and are incorporated by reference into this Item 8. ITEM 9.
In particular, these items could cause our Canadian oil sands and pipeline 45 customers to reduce production, delay expansionary and maintenance spending and defer additional investments in their oil sands assets.
In particular, these items could 44 cause our Canadian oil sands and pipeline customers to delay expansionary and maintenance spending and defer additional investments in their oil sands assets and in extreme cases reduce production.
The foregoing capital expenditure forecast does not include any funds for strategic acquisitions, which we could pursue should the transaction economics be attractive enough to us compared to the current capital allocation priorities of debt reduction and return of capital to shareholders.
The foregoing capital expenditure forecast does not include any funds for strategic acquisitions, which we could pursue should the transaction economics be attractive enough to us compared to the current capital allocation priorities of returning capital to shareholders.
As discussed in Part I, Item 1A, “Risk Factors,” under the heading “Financial/Accounting Risks – We may not have adequate insurance for potential liabilities and insurance may not cover certain liabilities,” we maintain cyber risk insurance to mitigate our exposure to these threats. Governance Risk oversight is a responsibility of the Board.
As discussed in Part I, Item 1A, “Risk Factors,” under the heading “Financial/Accounting Risks – We may not have adequate insurance for potential liabilities and insurance may not cover certain liabilities,” we maintain cyber risk insurance to mitigate our exposure to these threats.
A hypothetical 10% adverse change in the value of the Canadian dollar and Australian dollar relative to the U.S. dollar as of December 31, 2023 would result in translation adjustments of approximately $23 million and $21 million, respectively, recorded in other comprehensive loss.
A hypothetical 10% adverse change in the value of the Canadian dollar and Australian dollar relative to the U.S. dollar as of December 31, 2024 would result in translation adjustments of approximately $17 million and $19 million, respectively, recorded in other comprehensive loss.
We recorded pre-tax impairment expense of $5.7 million in 2022 associated with long-lived assets in the U.S. and our Australian reporting unit. See Note 4 - Impairment Charges to the notes to the consolidated financial statements included in Item 8 of this annual report for further discussion. Gain on Sale of McClelland Lake Lodge Assets, net.
We recorded pre-tax impairment expense of $1.4 million in 2023 associated with long-lived assets in Australia and the U.S. See Note 4 - Impairment Charges to the notes to the consolidated financial statements included in Item 8 of this annual report for further discussion. Gain on Sale of McClelland Lake Lodge Assets, net.
Long-term demand for our services has been driven by natural resource production, maintenance and operation of those facilities as well as expansion of those sites. In general, industry capital spending programs are based on the outlook for commodity prices, production costs, economic growth, global commodity supply/demand, estimates of resource production and the expectations of our customers' shareholders.
Long-term demand for our services has been driven by natural resource production, maintenance, operation and expansion of those facilities. In general, industry capital spending programs are based on the outlook for commodity prices, production costs, economic growth, perceived political risk, global commodity supply/demand, reserve replacement requirements, estimates of resource production, annual maintenance requirements and the expectations of our customers' shareholders.
In Canada, WCS crude is the benchmark price for our oil sands customers. Pricing for WCS is driven by several factors, including the underlying price for WTI crude, the availability of transportation infrastructure (consisting of pipelines and crude by railcar), refinery blending requirements and governmental regulation.
Pricing for WCS is driven by several factors, including the underlying price for WTI crude, the availability of transportation infrastructure (consisting of pipelines and crude by railcar), refinery blending requirements and governmental regulation.
We expect our capital expenditures for 2024 to be in the range of $30 million to $35 million, which excludes any unannounced and uncommitted projects, the spending for which is contingent on obtaining customer contracts or commitments.
We expect our capital expenditures for 2025 to be in the range of $25 million to $30 million, which excludes any unannounced and uncommitted projects, the spending for which is contingent on obtaining customer contracts or commitments or attractive risk-adjusted economics.
Other comprehensive income increased $28.0 million in 2023 compared to 2022 primarily as a result of foreign currency translation adjustments due to changes in the Canadian and Australian dollar exchange rates compared to the U.S. dollar. The Canadian dollar exchange rate compared to the U.S. dollar increased 2.4% in 2023 compared to a 6.4% decrease in 2022.
Other comprehensive income decreased $28.6 million in 2024 compared to 2023 primarily as a result of foreign currency translation adjustments due to changes in the Canadian and Australian dollar exchange rates compared to the U.S. dollar. The Canadian dollar exchange rate compared to the U.S. dollar decreased 8.1% in 2024 compared to a 2.4% increase in 2023.
In addition, capital has been used to repay debt and fund strategic business acquisitions. In the future, capital may be required to move lodges from one site to another. Historically, our primary sources of funds have been available cash, cash flow from operations, borrowings under our Credit Agreement and proceeds from equity issuances.
In addition, capital has been used to repay debt and fund strategic business acquisitions. Historically, our primary sources of funds have been available cash, cash flow from operations, borrowings under our Credit Agreement and proceeds from equity issuances.
Executive management, including the CISO, regularly meets with the Audit Committee to discuss cybersecurity risks, review quarterly cyber metrics and oversee progress against our annual action plans.
The CISO and executive management play a pivotal role in informing the Audit Committee on cybersecurity risks. Executive management, including the CISO, meets regularly with the Audit Committee to discuss cybersecurity risks, review 37 quarterly cyber metrics and oversee progress against our annual action plans.
Based on management’s judgment of capital spending classifications, we believe the following table represents the components of capital expenditures for the years ended December 31, 2023 and 2022 (in millions): Year Ended December 31, 2023 2022 Expansion Maint Total Expansion Maint Total Lodge/village $ 12.8 $ 11.6 $ 24.4 $ 0.2 $ 19.7 $ 19.9 Mobile assets 1.3 — 1.3 — 1.1 1.1 Other 2.4 3.5 5.9 2.0 2.4 4.4 Total $ 16.5 $ 15.1 $ 31.6 $ 2.2 $ 23.2 $ 25.4 Expansion lodge and village spending in 2023 was largely related to customer-funded infrastructure upgrades at three Australian villages.
Based on management’s judgment of capital spending classifications, we believe the following represents the components of capital expenditures for the years ended December 31, 2024 and 2023 (in millions): Year Ended December 31, 2024 2023 Expansion Maint Total Expansion Maint Total Lodge/village $ 7.3 $ 13.2 $ 20.5 $ 12.8 $ 11.6 $ 24.4 Mobile assets — — — 1.3 — 1.3 Other 3.2 2.4 5.6 2.4 3.5 5.9 Total $ 10.5 $ 15.6 $ 26.1 $ 16.5 $ 15.1 $ 31.6 Expansion lodge and village spending in 2024 was related to costs associated with the customer-supported reactivation of our Buffalo Lodge in Canada and customer-funded infrastructure upgrades at three Australian villages.
See the discussion of segment results of operations below for further information. Cost of Sales and Services. Our consolidated cost of sales and services increased $13.2 million, or 3%, in 2023 compared to 2022.
See below for further discussion of segment results of operations. Cost of Sales and Services. Our consolidated cost of sales and services increased $2.4 million, or 0.4%, in 2024 compared to 2023.
Other maintenance and expansion spending in 2022 was primarily associated with mobilization of new sites at our integrated services business in Western Australia, purchases of miscellaneous equipment and supplies to support the day-to-day operations at our accommodation facilities and information technology infrastructure to support our business.
Other maintenance and expansion spending in 2024 was primarily related to miscellaneous equipment and supplies to support the day-to-day operations at our accommodation and laundry facilities, purchases to support new contacts at our integrated services business in Australia and information technology infrastructure to support our business.
As further discussed below, net income included (i) $28.3 million of net gains associated with the sale of the McClelland Lake Lodge in Canada and (ii) a $1.4 million pre-tax loss resulting from the impairment of fixed assets included in Impairment expense. We reported net income attributable to Civeo for 2022 of $2.2 million, or $0.21 loss per diluted share.
As further discussed below, net loss included $5.7 million of net gains associated with the sale of McClelland Lake Lodge in Canada and a $11.6 million pre-tax loss resulting from the impairment of fixed assets included in Impairment expense. We reported net income attributable to Civeo for 2023 of $30.2 million, or $2.01 per diluted share.
This increase was primarily due to (i) increased occupancy at our Civeo owned villages in the Australian Bowen Basin and Gunnedah Basin and (ii) increased activity at our integrated services villages in Western Australia.
This increase was primarily due to increased occupancy at our Civeo owned villages in the Australian Bowen Basin and new business in our integrated services villages in Western Australia and the associated overhead costs.
Our Canadian segment reported revenues in 2023 that were $43.2 million, or 11%, lower than 2022. The weakening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 3.6% in 2023 compared to 2022 resulted in a $13.9 million period-over-period decrease in revenues.
Our Canadian segment reported revenues in 2024 that were $107.7 million, or 31%, lower than 2023. The weakening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 1.5% in 2024 compared to 2023 resulted in a $3.1 million period-over-period decrease in revenues.
We continue to monitor the global economy, commodity prices, demand for crude oil, met coal, LNG and iron ore, inflation and the resultant impact on the capital spending plans of our customers in order to plan our business activities, and we may adjust our capital expenditure plans in the future. 54 The table below delineates historical capital expenditures split between expansionary and maintenance spending on our lodges and villages, mobile asset spending and other capital expenditures.
We continue to monitor the global economy, commodity prices, demand for met coal, crude oil, LNG and iron ore, inflation and the resultant impact on the capital spending plans of our customers in order to plan our business activities, and we may adjust our capital expenditure plans in the future.
WCS prices in the fourth quarter of 2023 averaged $55.31 per barrel compared to an average of $54.72 in the fourth quarter of 2022. The WCS Differential decreased from $27.39 per barrel at the end of the fourth quarter of 2022 to $19.35 at the end of the fourth quarter of 2023.
WCS prices in the fourth quarter of 2024 averaged $57.50 per barrel compared to an average of $55.31 in the fourth quarter of 2023. The WCS Differential decreased from $19.35 per barrel at the end of the fourth quarter of 2023 to $13.49 at the end of the fourth quarter of 2024.
Overview and Macroeconomic Environment Historically, initial demand for our hospitality services has been driven by our customers’ capital spending programs related to the construction and development of natural resource projects and associated infrastructure, as well as the exploration for oil and natural gas.
Overview and Macroeconomic Environment Demand for our hospitality services is driven primarily by ongoing operations of existing natural resource projects in Australia and Canada. Historically, initial demand for our hospitality services has been driven by our customers’ capital spending programs related to the construction and development of natural resource projects and associated infrastructure.
Recent Commodity Prices Recent West Texas Intermediate (WTI) crude, Western Canadian Select (WCS) crude, met coal and iron ore pricing trends are as follows: Average Price (1) Quarter ended WTI Crude (per bbl) WCS Crude (per bbl) Hard Coking Coal (Met Coal) (per tonne) Iron Ore (per tonne) First Quarter through February 23, 2024 $ 74.99 $ 56.16 $ 323.93 $ 127.50 12/31/2023 78.55 55.31 332.24 122.24 9/30/2023 82.50 66.20 260.12 111.04 6/30/2023 73.54 60.25 243.54 106.98 3/31/2023 75.96 56.61 341.08 117.08 12/31/2022 82.82 54.72 276.19 94.93 9/30/2022 91.63 70.70 252.63 99.21 6/30/2022 108.77 92.89 464.61 128.80 3/31/2022 95.17 82.04 474.83 129.46 12/31/2021 77.31 60.84 371.95 104.88 9/30/2021 70.54 57.58 258.41 164.90 6/30/2021 66.19 53.27 136.44 195.97 3/31/2021 58.13 46.28 127.95 159.83 12/31/2020 42.63 31.34 109.37 128.24 (1) Source: WTI crude prices are from U.S.
Recent Commodity Prices Recent met coal, iron ore, West Texas Intermediate (WTI) crude, and Western Canadian Select (WCS) crude pricing trends are as follows: Average Price (1) Quarter ended Hard Coking Coal (Met Coal) (per tonne) Iron Ore (per tonne) WTI Crude (per bbl) WCS Crude (per bbl) First Quarter through February 21, 2025 $ 190.01 $ 97.82 $ 73.79 $ 59.71 12/31/2024 203.50 96.00 70.42 57.50 9/30/2024 210.74 94.54 75.29 59.97 6/30/2024 242.93 106.01 80.83 67.24 3/31/2024 307.68 118.54 77.01 59.48 12/31/2023 332.24 122.24 78.60 55.31 9/30/2023 260.12 111.04 82.50 66.20 6/30/2023 243.54 106.98 73.54 60.25 3/31/2023 341.08 117.08 75.96 56.61 12/31/2022 276.19 94.93 82.82 54.72 9/30/2022 252.63 99.21 91.63 70.70 6/30/2022 464.61 128.80 108.77 92.89 3/31/2022 474.83 129.46 95.17 82.04 (1) Source: Hard coking prices are from IHS Markit, iron ore prices and WCS crude prices are from Bloomberg and WTI crude prices are from U.S.
If floating interest rates increased by 100 basis points, our consolidated interest expense would increase by approximately $0.7 million annually, based on our floating-rate debt obligations and interest rates in effect as of December 31, 2023.
These floating-rate obligations expose us to the risk of increased interest expense in the event of increases in short-term interest rates. If floating interest rates increased by 100 basis points, our consolidated interest expense would increase by approximately $0.4 million annually, based on our floating-rate debt obligations and interest rates in effect as of December 31, 2024.
(2) Includes revenues related to food service and other services, including facilities management, for the periods presented. (3) Average daily rate is based on billed rooms and accommodation revenue. (4) Billed rooms represents total billed days for owned assets for the periods presented. Our Australian segment reported revenues in 2023 that were $58.5 million, or 21%, higher than 2022.
(2) Includes revenues related to food service and other services, including facilities management, for the periods presented. (3) Average daily rate is based on billed rooms and accommodation and other services revenue. (4) Billed rooms represents total billed days for owned assets for the periods presented.
In 2022, tax expense in Canada 50 was offset by a valuation allowance release of $0.6 million and the tax benefit in the U.S. was offset by an increase to the valuation allowance of $1.0 million. Other Comprehensive Income (Loss).
In 2023, tax expense in Canada and the U.S. was offset by a valuation allowance release of $1.7 million and $0.8 million, respectively. Other Comprehensive Income (Loss).
Description of the Business We provide a suite of hospitality services for our guests in the natural resources industry, including lodging, catering and food service, housekeeping and maintenance at accommodation facilities that we or our customers own.
Description of the Business We provide hospitality services to remote workforces in Australia and Canada, including catering and food service, lodging, housekeeping and maintenance at accommodation facilities that we or our customers own.
Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2023 at the reasonable assurance level.
Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2024 at the reasonable assurance level. (ii) Internal Control Over Financial Reporting (a) Management's annual report on internal control over financial reporting.
Certain expansionary oil pipeline projects have the potential to both drive incremental demand for mobile assets and to improve take-away capacity for Canadian oil sands producers over the longer term.
Certain expansionary oil pipeline projects have the potential to both drive incremental demand for mobile assets and to improve take-away capacity for Canadian oil sands producers over the longer term, most notably the Trans Mountain Pipeline expansion, which began operating in the second quarter of 2024.
In order to promote a company-wide culture of cybersecurity risk management, management has also implemented a variety of required programs to both test and train our employees on cybersecurity fundamentals, including both annual and ongoing information security awareness training. Our cybersecurity policies and procedures encompass data privacy, incident response, information security and risks from our use of third-party vendors.
In order to promote a company-wide culture of cybersecurity risk management, management has also implemented programs to both test and train our employees on cybersecurity fundamentals, including both annual and ongoing information security awareness training.
Our effective tax rate for 2023 and 2022 was higher than the Canadian federal statutory rate of 15%, primarily due to pre-tax income in Australia being taxed at the higher Australian income tax rate of 30%.
Our effective tax rate for 2023 was higher than the Canadian federal statutory rate of 15%, primarily due to pre-tax income in Australia being taxed at the higher Australian income tax rate of 30%. Full valuation allowances are maintained against net deferred tax assets in both Canada and the U.S.
The Board has delegated responsibility for monitoring technology and cybersecurity risks to the Audit Committee. The Board reviews the Company's cybersecurity risk posture, strategy and execution on at least an annual basis while the Audit Committee receives cybersecurity updates quarterly. The CISO and executive management play a pivotal role in informing the Audit Committee on cybersecurity risks.
Governance While the Board maintains responsibility for risk oversight it has delegated responsibility for evaluating technology and cybersecurity risks to the Audit Committee. The Board reviews the Company's cybersecurity risk posture, strategy and execution on at least an annual basis while the Audit Committee receives cybersecurity updates quarterly.
Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with GAAP.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with GAAP.
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