Photo courtesy Tidewater
Shares of Houston-based offshore support vessel operator Tidewater Inc. (NYSE:TDW) surged as much as 15% on Friday following its fourth quarter and full year 2023 earnings release. The company reported revenues of $302.7 million for Q4 2023 and a little over $1 billion for the full year 2023, a substantial increase from $186.7 million and $647.7 million for the same periods in 2022.
Net income for Q4 and the full year of 2023 was $37.7 million ($0.70 per share) and $97.2 million ($1.84 per share), respectively, a dramatic turnaround from the net income of $10.6 million ($0.20 per share) and a loss of $21.7 million ($0.49 per share) reported for the same periods in 2022.
President and CEO Quintin Kneen said the company acheived considerable milestones and profitable growth in 2023, with revenue and gross profit consistently improving each quarter with positive supply and demand dynamics in the offshore vessel industry.
Tidewater hit a milestone with revenue crossing the $1.0 billion mark, bolstered by acquisitions made in 2022 and 2023. Kneen also highlighted the rapid progression of day rates, which he described as “faster than anything we have seen in the industry.”
The company’s strong performance has enabled it to return capital to shareholders, commencing with $35.0 million of share repurchases in Q4 2023. The company expects to continue growing free cash flow and returning capital to shareholders.
Kneen noted the company’s strategy of upgrading the fleet since 2017 has paid off, resulting in higher revenue and gross margin outlook for the business.
“The shortage of vessels, a record-low vessel newbuilding order book and improving offshore vessel demand visibility all support improving operational performance into 2024 and beyond, as indicated by our continued confidence in our ability to grow revenue by 40% and grow gross margin by 66% in 2024,” said Kneen.
The company also announced a new share repurchase program, authorized to purchase up to $48.6 million of the company’s common stock. This move comes after an impressive $61.0 million of free cash flow was generated in Q4, nearly 60% of which was returned to shareholders via share repurchases.
Tidewater looks forward to a promising 2024, with Kneen reiterating full-year revenue guidance of $1.40 to $1.45 billion and gross margin guidance of 52.0%.
“The past year was an important chapter in Tidewater’s history and was a successful year by all measures,” Kneen said.
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