Civeo Corporation (NYSE: CVEO) unveiled its first-quarter 2025 financial outcomes, showcasing a mixed performance across its operational regions. The company reported consolidated revenue of $144.0 million, missing analyst expectations, largely due to a 40% year-over-year decline in Canadian operations to $40.4 million. This downturn was attributed to reduced spending in the oil sands region and the loss of Fort Hills-related occupancy, prompting Civeo to implement significant cost reductions, including a 25% cut in Canadian workforce and the closure of two lodges.
In contrast, the Australian segment showed robust growth, with revenues increasing by 13% year-over-year to $103.6 million, bolstered by a six-year, A$1.4 billion contract for integrated services. The segment's adjusted EBITDA remained stable at $20.5 million, underscoring its resilience amidst global market fluctuations.
A pivotal moment for Civeo came on May 7, 2025, with the acquisition of four villages in the Australian Bowen Basin. This strategic move is expected to contribute approximately $32.0 million in revenue and $17.0 million in EBITDA, enhancing Civeo's footprint in the Blackwater region and securing contracts with met coal producers. Following this acquisition, Civeo adjusted its full-year 2025 revenue guidance to between $640 million and $670 million, with adjusted EBITDA projected at $86 million to $96 million, while maintaining capital expenditure guidance at $20 million to $25 million.
Financial analysis by Stonegate Capital Partners, utilizing discounted cash flow and enterprise value to EBITDA methods, estimated Civeo's valuation between $29.03 and $37.91 per share. These developments reflect Civeo's strategic navigation through the volatile Canadian energy sector and its concerted efforts to capitalize on growth opportunities in Australia, marking a critical phase in the company's operational and financial trajectory.
