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SEACOR Marine Holdings Inc. - Quarter Report: 2022 June (Form 10-Q)

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 10-Q

 

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2022               or             

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from              to

Commission file number 1-37966

SEACOR Marine Holdings Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

 

Delaware

 

47-2564547

(State or Other Jurisdiction of

Incorporation or Organization)

 

(IRS Employer

Identification No.)

 

 

 

12121 Wickchester Lane, Suite 500, Houston, TX

 

77079

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (346) 980-1700

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

SMHI

New York Stock Exchange

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes       No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes      No  

The total number of shares of common stock, par value $.01 per share (“Common Stock”), outstanding as of July 29, 2022 was 26,705,661. The Registrant has no other class of common stock outstanding.

 

 

 


 

SEACOR MARINE HOLDINGS INC.

Table of Contents

 

Part I.

 

Financial Information

 

1

 

 

 

 

 

 

 

 

Item 1.

Financial Statements (Unaudited)

 

1

 

 

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021

 

1

 

 

 

Condensed Consolidated Statements of Income (Loss) for the Three and Six Months Ended June 30, 2022 and 2021

 

2

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2022 and 2021

 

3

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2022 and 2021

 

4

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2022 and 2021

 

6

 

 

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements

 

7

 

 

 

 

 

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

24

 

 

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

48

 

 

 

 

 

 

 

 

Item 4.

Controls and Procedures

 

48

 

 

 

 

 

 

Part II.

 

Other Information

 

49

 

 

 

 

 

 

 

 

Item 1.

Legal Proceedings

 

49

 

 

 

 

 

 

 

 

Item 1A.

Risk Factors

 

49

 

 

 

 

 

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

49

 

 

 

 

 

 

 

 

Item 3.

Default Upon Senior Securities

 

49

 

 

 

 

 

 

 

 

Item 4.

Mine Safety Disclosures

 

49

 

 

 

 

 

 

 

 

Item 5.

Other Information

 

49

 

 

 

 

 

 

 

 

Item 6.

Exhibits

 

50

 

 

i


 

PART I—FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

SEACOR MARINE HOLDINGS INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

 

 

 

June 30, 2022

 

 

December 31, 2021

 

ASSETS

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

22,608

 

 

$

37,619

 

Restricted cash

 

 

3,296

 

 

 

3,601

 

Receivables:

 

 

 

 

 

 

 

 

Trade, net of allowance for credit loss accounts of $1,842 and $1,312 in 2022 and 2021, respectively

 

 

55,276

 

 

 

55,544

 

Other

 

 

7,437

 

 

 

6,118

 

Tax receivable

 

 

79

 

 

 

1,238

 

Inventories

 

 

1,723

 

 

 

928

 

Prepaid expenses and other

 

 

5,391

 

 

 

3,730

 

Total current assets

 

 

95,810

 

 

 

108,778

 

Property and Equipment:

 

 

 

 

 

 

 

 

Historical cost

 

 

1,000,147

 

 

 

1,025,284

 

Accumulated depreciation

 

 

(325,091

)

 

 

(317,297

)

 

 

 

675,056

 

 

 

707,987

 

Construction in progress

 

 

15,576

 

 

 

15,531

 

Net property and equipment

 

 

690,632

 

 

 

723,518

 

Right-of-use asset - operating leases

 

 

5,686

 

 

 

6,608

 

Right-of-use asset - finance leases

 

 

7,131

 

 

 

100

 

Investments, at equity, and advances to 50% or less owned companies

 

 

75,923

 

 

 

71,727

 

Other assets

 

 

1,932

 

 

 

1,771

 

Total assets

 

$

877,114

 

 

$

912,502

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

Current portion of operating lease liabilities

 

$

2,010

 

 

$

1,986

 

Current portion of financing lease liabilities

 

 

282

 

 

 

33

 

Current portion of long-term debt:

 

 

 

 

 

 

 

 

Recourse

 

 

33,398

 

 

 

31,602

 

Accounts payable and accrued expenses

 

 

39,262

 

 

 

28,419

 

Due to SEACOR Holdings

 

 

264

 

 

 

274

 

Accrued wages and benefits

 

 

3,259

 

 

 

3,711

 

Accrued interest

 

 

1,466

 

 

 

2,273

 

Deferred revenue and unearned revenue

 

 

1,369

 

 

 

1,606

 

Accrued capital, repair, and maintenance expenditures

 

 

8,208

 

 

 

2,438

 

Accrued insurance deductibles and premiums

 

 

2,325

 

 

 

2,720

 

Accrued professional fees

 

 

1,372

 

 

 

1,214

 

Derivatives

 

 

24

 

 

 

1,831

 

Other current liabilities

 

 

4,148

 

 

 

6,558

 

Total current liabilities

 

 

97,387

 

 

 

84,665

 

Long-term operating lease liabilities

 

 

4,026

 

 

 

4,885

 

Long-term financing lease liabilities

 

 

7,050

 

 

 

76

 

Long-term Debt:

 

 

 

 

 

 

 

 

Recourse

 

 

313,224

 

 

 

327,300

 

Non-recourse

 

 

5,475

 

 

 

5,462

 

Conversion option liability on convertible senior notes

 

 

1

 

 

 

 

Deferred income taxes

 

 

33,743

 

 

 

40,682

 

Deferred gains and other liabilities

 

 

2,701

 

 

 

2,891

 

Total liabilities

 

 

463,607

 

 

 

465,961

 

Equity:

 

 

 

 

 

 

 

 

SEACOR Marine Holdings Inc. stockholders’ equity:

 

 

 

 

 

 

 

 

Common stock, $.01 par value, 60,000,000 shares authorized; 26,954,299 and 26,120,124 shares issued in 2022 and 2021, respectively

 

 

272

 

 

 

262

 

Additional paid-in capital

 

 

464,222

 

 

 

461,931

 

Accumulated deficit

 

 

(55,418

)

 

 

(22,907

)

Shares held in treasury of 248,638 and 127,887, respectively, at cost

 

 

(1,852

)

 

 

(1,120

)

Accumulated other comprehensive income, net of tax

 

 

5,960

 

 

 

8,055

 

 

 

 

413,184

 

 

 

446,221

 

Noncontrolling interests in subsidiaries

 

 

323

 

 

 

320

 

Total equity

 

 

413,507

 

 

 

446,541

 

Total liabilities and equity

 

$

877,114

 

 

$

912,502

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements and should be read in conjunction herewith.

 

1


 

SEACOR MARINE HOLDINGS INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

(in thousands, except share data)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Operating Revenues

 

$

54,017

 

 

$

42,799

 

 

$

99,608

 

 

$

79,311

 

Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating

 

 

44,145

 

 

 

32,615

 

 

 

83,641

 

 

 

58,922

 

Administrative and general

 

 

10,210

 

 

 

9,152

 

 

 

20,134

 

 

 

17,763

 

Lease expense

 

 

1,008

 

 

 

1,234

 

 

 

2,068

 

 

 

2,312

 

Depreciation and amortization

 

 

14,208

 

 

 

14,093

 

 

 

28,579

 

 

 

28,891

 

 

 

 

69,571

 

 

 

57,094

 

 

 

134,422

 

 

 

107,888

 

Gains on Asset Dispositions and Impairments, Net

 

 

25

 

 

 

22,653

 

 

 

2,164

 

 

 

20,380

 

Operating (Loss) Income

 

 

(15,529

)

 

 

8,358

 

 

 

(32,650

)

 

 

(8,197

)

Other Income (Expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

190

 

 

 

135

 

 

 

219

 

 

 

1,121

 

Interest expense

 

 

(6,989

)

 

 

(7,310

)

 

 

(13,616

)

 

 

(15,328

)

SEACOR Holdings guarantee fees

 

 

 

 

 

 

 

 

 

 

 

(7

)

Gain on debt extinguishment

 

 

 

 

 

61,994

 

 

 

 

 

 

61,994

 

Derivative gains (losses), net

 

 

33

 

 

 

30

 

 

 

(1

)

 

 

385

 

Foreign currency gains (losses), net

 

 

1,170

 

 

 

(657

)

 

 

1,991

 

 

 

(1,123

)

Other, net

 

 

(41

)

 

 

(1

)

 

 

(41

)

 

 

(1

)

 

 

 

(5,637

)

 

 

54,191

 

 

 

(11,448

)

 

 

47,041

 

(Loss) Income from Continuing Operations Before Income Tax Expense (Benefit) and Equity in Earnings of 50% or Less Owned Companies

 

 

(21,166

)

 

 

62,549

 

 

 

(44,098

)

 

 

38,844

 

Income Tax (Benefit) Expense

 

 

(1,634

)

 

 

15,915

 

 

 

(4,055

)

 

 

13,227

 

(Loss) Income from Continuing Operations Before Equity in Earnings of 50% or Less Owned Companies

 

 

(19,532

)

 

 

46,634

 

 

 

(40,043

)

 

 

25,617

 

Equity in Earnings Gains of 50% or Less Owned Companies

 

 

415

 

 

 

2,167

 

 

 

6,089

 

 

 

6,270

 

(Loss) Income from Continuing Operations

 

 

(19,117

)

 

 

48,801

 

 

 

(33,954

)

 

 

31,887

 

Income on Discontinued Operations, Net of Tax (see Note 12)

 

 

 

 

 

 

 

 

 

 

 

22,925

 

Net (Loss) Income

 

 

(19,117

)

 

 

48,801

 

 

 

(33,954

)

 

 

54,812

 

Net Income Attributable to Noncontrolling Interests in Subsidiaries

 

 

3

 

 

 

1

 

 

 

3

 

 

 

1

 

Net (Loss) Income Attributable to SEACOR Marine Holdings Inc.

 

$

(19,120

)

 

$

48,800

 

 

$

(33,957

)

 

$

54,811

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (Loss) Income Per Common Share from Continuing Operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.72

)

 

$

1.92

 

 

$

(1.28

)

 

$

1.26

 

Diluted

 

 

(0.72

)

 

 

1.79

 

 

 

(1.28

)

 

 

1.26

 

Net Earnings Per Share from Discontinued Operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

 

 

$

 

 

$

 

 

$

0.90

 

Diluted

 

 

 

 

 

 

 

 

 

 

 

0.90

 

Net (Loss) Earnings per Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.72

)

 

$

1.92

 

 

$

(1.28

)

 

$

2.16

 

Diluted

 

$

(0.72

)

 

$

1.79

 

 

$

(1.28

)

 

$

2.16

 

Weighted Average Common Stock and Warrants Outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

26,664,745

 

 

 

25,435,362

 

 

 

26,522,808

 

 

 

25,370,372

 

Diluted

 

 

26,664,745

 

 

 

28,345,155

 

 

 

26,522,808

 

 

 

25,371,185

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements and should be read in conjunction herewith.

 

2


 

SEACOR MARINE HOLDINGS INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net (Loss) Income

 

$

(19,117

)

 

$

48,801

 

 

$

(33,954

)

 

$

54,812

 

Other Comprehensive Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation (losses) gains

 

 

(3,849

)

 

 

(70

)

 

 

(4,563

)

 

 

4,322

 

Derivative gains (losses) on cash flow hedges

 

 

351

 

 

 

(95

)

 

 

1,156

 

 

 

32

 

Reclassification of derivative losses on cash flow hedges to interest expense

 

 

267

 

 

 

415

 

 

 

637

 

 

 

830

 

Reclassification of derivative gains (losses) on cash flow hedges to equity in earnings of 50% or less owned companies

 

 

338

 

 

 

(589

)

 

 

675

 

 

 

(867

)

 

 

 

(2,893

)

 

 

(339

)

 

 

(2,095

)

 

 

4,317

 

Comprehensive (Loss) Income

 

 

(22,010

)

 

 

48,462

 

 

 

(36,049

)

 

 

59,129

 

Comprehensive Income Attributable to Noncontrolling Interests in Subsidiaries

 

 

3

 

 

 

1

 

 

 

3

 

 

 

1

 

Comprehensive (Loss) Income attributable to SEACOR Marine Holdings Inc.

 

$

(22,013

)

 

$

48,461

 

 

$

(36,052

)

 

$

59,128

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements and should be read in conjunction herewith.

 

3


 

SEACOR MARINE HOLDINGS INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(in thousands, except share data)

 

 

 

Shares of

Common

Stock

Outstanding

 

 

Common

Stock

 

 

Additional

Paid-In

Capital

 

 

Shares

Held in

Treasury

 

 

Treasury

Stock

 

 

Accumulated Deficit

 

 

Accumulated

Other

Comprehensive

Income

 

 

Non-

Controlling

Interests In

Subsidiaries

 

 

Total

Equity

 

For the Six Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2021

 

 

25,992,237

 

 

$

262

 

 

$

461,931

 

 

 

127,887

 

 

$

(1,120

)

 

$

(22,907

)

 

$

8,055

 

 

$

320

 

 

$

446,541

 

Restricted stock grants

 

 

738,896

 

 

 

9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9

 

Amortization of share awards

 

 

 

 

 

 

 

 

2,140

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,140

 

Exercise of options

 

 

34,492

 

 

 

 

 

 

151

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

151

 

Restricted stock vesting

 

 

(114,251

)

 

 

 

 

 

 

 

 

114,251

 

 

 

(672

)

 

 

 

 

 

 

 

 

 

 

 

(672

)

Director share awards

 

 

60,787

 

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

Director restricted stock vesting

 

 

(6,500

)

 

 

 

 

 

 

 

 

6,500

 

 

 

(60

)

 

 

 

 

 

 

 

 

 

 

 

(60

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(33,957

)

 

 

 

 

 

3

 

 

 

(33,954

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,446

 

 

 

(2,095

)

 

 

 

 

 

(649

)

June 30, 2022

 

 

26,705,661

 

 

$

272

 

 

$

464,222

 

 

 

248,638

 

 

$

(1,852

)

 

$

(55,418

)

 

$

5,960

 

 

$

323

 

 

$

413,507

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2022

 

 

26,643,873

 

 

$

269

 

 

$

463,138

 

 

 

242,138

 

 

$

(1,792

)

 

$

(37,744

)

 

$

8,853

 

 

$

320

 

 

$

433,044

 

Restricted stock grants

 

 

5,001

 

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

Amortization of share awards

 

 

 

 

 

 

 

 

1,073

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,073

 

Exercise of options

 

 

2,500

 

 

 

 

 

 

11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11

 

Director share awards

 

 

60,787

 

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

Director restricted stock vesting

 

 

(6,500

)

 

 

 

 

 

 

 

 

6,500

 

 

 

(60

)

 

 

 

 

 

 

 

 

 

 

 

(60

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(19,120

)

 

 

 

 

 

3

 

 

 

(19,117

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,446

 

 

 

(2,893

)

 

 

 

 

 

(1,447

)

June 30, 2022

 

 

26,705,661

 

 

$

272

 

 

$

464,222

 

 

 

248,638

 

 

$

(1,852

)

 

$

(55,418

)

 

$

5,960

 

 

$

323

 

 

$

413,507

 


The accompanying notes are an integral part of these condensed consolidated financial statements and should be read in conjunction herewith.

 

4


 

 

 

 

Shares of

Common

Stock

Outstanding

 

 

Common

Stock

 

 

Additional

Paid-In

Capital

 

 

Shares

Held in

Treasury

 

 

Treasury

Stock

 

 

Accumulated Deficit

 

 

Accumulated

Other

Comprehensive

Income

 

 

Non-

Controlling

Interests In

Subsidiaries

 

 

Total

Equity

 

For the Six Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2020

 

 

23,430,766

 

 

 

235

 

 

 

451,179

 

 

 

73,284

 

 

 

(848

)

 

 

(51,839

)

 

 

2,790

 

 

 

319

 

 

 

401,836

 

Restricted stock grants

 

 

815,550

 

 

 

8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8

 

Amortization of share awards

 

 

 

 

 

 

 

 

2,465

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,465

 

Restricted stock vesting

 

 

(54,454

)

 

 

 

 

 

 

 

 

54,454

 

 

 

(272

)

 

 

 

 

 

 

 

 

 

 

 

(272

)

Director share awards

 

 

189,030

 

 

 

2

 

 

 

435

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

437

 

Sale of Windcat Workboats

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(4,202

)

 

 

 

 

 

 

 

 

(4,202

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

54,811

 

 

 

 

 

 

1

 

 

 

54,812

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,317

 

 

 

 

 

 

4,317

 

June 30, 2021

 

 

24,380,892

 

 

$

245

 

 

$

454,079

 

 

 

127,738

 

 

$

(1,120

)

 

$

(1,230

)

 

$

7,107

 

 

$

320

 

 

$

459,401

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021

 

 

24,194,383

 

 

$

243

 

 

$

452,290

 

 

 

125,217

 

 

$

(1,110

)

 

$

(50,029

)

 

$

7,446

 

 

$

319

 

 

$

409,159

 

Amortization of share awards

 

 

 

 

 

 

 

 

1,354

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,354

 

Restricted stock vesting

 

 

(2,521

)

 

 

 

 

 

 

 

 

2,521

 

 

 

(10

)

 

 

 

 

 

 

 

 

 

 

 

(10

)

Director share awards

 

 

189,030

 

 

 

2

 

 

 

435

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

437

 

Sale of Windcat Workboats

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1

)

 

 

 

 

 

 

 

 

(1

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,800

 

 

 

 

 

 

1

 

 

 

48,801

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(339

)

 

 

 

 

 

(339

)

June 30, 2021

 

 

24,380,892

 

 

$

245

 

 

$

454,079

 

 

 

127,738

 

 

$

(1,120

)

 

$

(1,230

)

 

$

7,107

 

 

$

320

 

 

$

459,401

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements and should be read in conjunction herewith.

 

5


 

SEACOR MARINE HOLDINGS INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

Cash Flows from Continuing Operating Activities:

 

 

 

 

 

 

 

 

Net (Loss) Income

 

$

(33,954

)

 

$

54,812

 

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

28,579

 

 

 

28,891

 

Deferred financing costs amortization

 

 

655

 

 

 

514

 

Stock-based compensation expense

 

 

1,408

 

 

 

2,628

 

Debt discount amortization

 

 

3,427

 

 

 

3,679

 

Allowance for credit losses

 

 

530

 

 

 

156

 

Gain from equipment sales, retirements or impairments

 

 

(2,164

)

 

 

(20,380

)

Gain on the sale of Windcat Workboats

 

 

 

 

 

(22,756

)

Gain on debt extinguishment

 

 

 

 

 

(62,749

)

Derivative losses (gains)

 

 

1

 

 

 

(385

)

Interest on finance leases

 

 

98

 

 

 

2

 

Cash settlement payments on derivative transactions, net

 

 

(651

)

 

 

(1,333

)

Currency (gains) losses

 

 

(1,991

)

 

 

1,123

 

Deferred income taxes

 

 

(6,939

)

 

 

10,347

 

Equity earnings

 

 

(6,089

)

 

 

(6,270

)

Dividends received from equity investees

 

 

1,887

 

 

 

 

Changes in Operating Assets and Liabilities:

 

 

 

 

 

 

 

 

Accounts receivables

 

 

(571

)

 

 

27,392

 

Other assets

 

 

(1,703

)

 

 

(104

)

Accounts payable and accrued liabilities

 

 

11,632

 

 

 

(6,028

)

Net cash (used in) provided by operating activities

 

 

(5,845

)

 

 

9,539

 

Cash Flows from Continuing Investing Activities:

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(37

)

 

 

(3,650

)

Proceeds from disposition of property and equipment

 

 

6,681

 

 

 

30,137

 

Proceeds from sale of Windcat Workboats, net of transaction costs and cash sold (1)

 

 

 

 

 

38,715

 

Investments in and advances to 50% or less owned companies

 

 

 

 

 

(736

)

Principal payments on notes due from equity investees

 

 

351

 

 

 

3,796

 

Net cash provided by investing activities

 

 

6,995

 

 

 

68,262

 

Cash Flows from Continuing Financing Activities:

 

 

 

 

 

 

 

 

Payments on long-term debt

 

 

(16,500

)

 

 

(65,089

)

Payments on debt extinguishment cost

 

 

 

 

 

(755

)

Payments on finance leases

 

 

(123

)

 

 

(12

)

Proceeds from exercise of stock options

 

 

151

 

 

 

 

Issuance of stock

 

 

10

 

 

 

10

 

Net cash used in financing activities

 

 

(16,462

)

 

 

(65,846

)

Effects of Exchange Rate Changes on Cash and Cash Equivalents

 

 

(4

)

 

 

(21

)

Net (Decrease) Increase in Cash, Restricted Cash and Cash Equivalents

 

 

(15,316

)

 

 

11,934

 

Cash Flows from Discontinued Operations:

 

 

 

 

 

 

 

 

Operating Activities

 

 

 

 

 

(171

)

Investing Activities

 

 

 

 

 

 

Financing Activities

 

 

 

 

 

 

Net Decrease in Cash, Restricted Cash and Cash Equivalents on Discontinued Operations

 

 

 

 

 

(171

)

Net (Decrease) Increase in Cash, Restricted Cash and Cash Equivalents

 

 

(15,316

)

 

 

11,763

 

Cash, Restricted Cash and Cash Equivalents, Beginning of Period

 

 

41,220

 

 

 

39,538

 

Cash, Restricted Cash and Cash Equivalents, End of Period

 

$

25,904

 

 

$

51,301

 

Supplemental disclosures:

 

 

 

 

 

 

 

 

Cash paid for interest, excluding capitalized interest

 

 

10,341

 

 

 

11,745

 

Income taxes refunded, net

 

 

887

 

 

 

31,400

 

Noncash Investing and Financing Activities:

 

 

 

 

 

 

 

 

Decrease in debt related to debt settlement

 

 

 

 

 

62,749

 

Decrease in capital expenditures in accounts payable and accrued liabilities

 

 

 

 

 

3,947

 

Recognition of a new right-of-use asset - operating leases

 

 

163

 

 

 

955

 

Recognition of a new right-of-use asset - financing leases

 

 

7,248

 

 

 

 

 

 

(1)

Refer to Note 2. Equipment Acquisitions and Dispositions for a reconciliation of the cash received from the sale of Windcat Workboats

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements and should be read in conjunction herewith.

 

6


 

SEACOR MARINE HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1.

BASIS OF PRESENTATION AND ACCOUNTING POLICIES

The condensed consolidated financial statements include the accounts of SEACOR Marine Holdings Inc. and its consolidated subsidiaries (the “Company”). In the opinion of management, all adjustments (consisting of normal recurring adjustments) have been made to fairly present the unaudited condensed consolidated financial statements for the periods indicated. Results of operations for the interim periods presented are not necessarily indicative of operating results for the full year or any future periods.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the Company’s financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Annual Report”).   

Unless the context otherwise indicates, any reference in this Quarterly Report on Form 10-Q to the “Company” refers to SEACOR Marine Holdings Inc. and its consolidated subsidiaries, and any reference in this Quarterly Report on Form 10-Q to “SEACOR Marine” refers to SEACOR Marine Holdings Inc. without its consolidated subsidiaries. 

Recently Adopted Accounting Standards.

On October 29, 2020, the FASB issued ASU 2020-10, Codification Improvements: Amendments that improve the consistency of the Codification by including all disclosure guidance in the appropriate Disclosure section. The guidance was effective for annual periods beginning after December 15, 2020, and interim periods within the annual periods beginning after December 15, 2022. The adoption of the standard did not have a material effect on the disclosures included herein.

On August 5, 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. The Company adopted the new standard on January 1, 2022. The adoption of the standard by the Company did not have a material impact on its consolidated financial position or on its results of operations, cash flows and disclosures.

On December 18, 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The adoption of the standard by the Company did not have a material impact on its consolidated financial position or on its results of operations and cash flows.

Recently Issued Accounting Standards

On March 12, 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. The ASU is intended to help stakeholders during the global market-wide reference rate transition period. Therefore, it will be in effect for a limited time through December 31, 2022. As of June 30, 2022, the reference rates for the Company’s existing debt and interest rate swaps have not changed as a

 

7


result of any such amendment. The Company will continue to monitor changes to reference rates in applicable agreements and adopt the standard as needed.

Critical Accounting Policies.

Basis of Consolidation. The consolidated financial statements include the accounts of SEACOR Marine and its controlled subsidiaries. Control is generally deemed to exist if the Company has greater than 50% of the voting rights of a subsidiary. All significant intercompany accounts and transactions are eliminated in the combination and consolidation.

Noncontrolling interests in consolidated subsidiaries are included in the consolidated balance sheets as a separate component of equity. The Company reports consolidated net income (loss) inclusive of both the Company’s and the noncontrolling interests’ share, as well as the amounts of consolidated net income (loss) attributable to each of the Company and the noncontrolling interests. If a subsidiary is deconsolidated upon a change in control, any retained noncontrolling equity investment in the former controlled subsidiary is measured at fair value and a gain or loss is recognized in net income (loss) based on such fair value. If a subsidiary is consolidated upon the business acquisition of controlling interests by the Company, any previous noncontrolled equity investment in the subsidiary is measured at fair value and a gain or loss is recognized in net income (loss) based on such fair value.

The Company employs the equity method of accounting for investments in 50% or less owned companies that it does not control but has the ability to exercise significant influence over the operating and financial policies of the business venture. Significant influence is generally deemed to exist if the Company has between 20% and 50% of the voting rights of a business venture but may exist when the Company’s ownership percentage is less than 20%. In certain circumstances, the Company may have an economic interest in excess of 50% but may not control and consolidate the business venture. Conversely, the Company may have an economic interest less than 50% but may control and consolidate the business venture. The Company reports its investments in and advances to these business ventures in the accompanying consolidated balance sheets as investments, at equity, and advances to 50% or less owned companies. The Company reports its share of earnings from investments in 50% or less owned companies in the accompanying consolidated statements of income (loss) as equity in earnings of 50% or less owned companies, net of tax.

Certain reclassifications were made to previously reported amounts in the consolidated financial statements and notes thereto to make them consistent with the current period presentation.

Use of Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates include those related to deferred revenues, allowance for credit loss accounts, useful lives of property and equipment, impairments, income tax provisions and certain accrued liabilities. Actual results could differ from estimates and those differences may be material.

Revenue Recognition. Revenue is recognized when (or as) the Company transfers promised goods or services to its customers in amounts that reflect the consideration to which the Company expects to be entitled to in exchange for those goods or services, which occurs when (or as) the Company satisfies its contractual obligations and transfers over control of the promised goods or services to its customers. The Company recognizes revenue net of sales taxes based on its estimates of the consideration the Company expects to receive. Costs to obtain or fulfill a contract are expensed as incurred.

 

8


The Company earns revenue primarily from the time charter and bareboat charter of vessels to customers. Since the Company charges customers based upon daily rates of hire, vessel revenues are recognized on a daily basis throughout the contract period. Under a time charter, the Company provides a vessel to a customer and is responsible for all operating expenses, typically excluding fuel. Under a bareboat charter, the Company provides a vessel to a customer and the customer assumes responsibility for all operating expenses and assumes all risks of operation. In the U.S. Gulf of Mexico, time charter durations and rates are typically established in the context of master service agreements that govern the terms and conditions of the charter. From time to time, the Company may also participate in pooling arrangements. In a pooling arrangement, the time charter revenues of certain of the Company’s vessels are shared with the time charter revenues of certain vessels of similar type owned by non-affiliated vessel owners based upon an agreed formula.

Contract or charter durations may range from several days to several years. Charters vary in length from short-term to multi-year periods, many with cancellation clauses and without early termination penalties. As a result of options and frequent renewals, the stated duration of charters may have little correlation with the length of time the vessel is contracted to provide services to a particular customer.

The Company also contracts with various customers to carry out management services for vessels as agents for and on behalf of ship owners. These services include crew management, technical management, commercial management, insurance arrangements, sale and purchase of vessels, provisions and bunkering. As the manager of the vessels, the Company undertakes to use its best efforts to provide the agreed management services as agents for and on behalf of the owners in accordance with sound ship management practice and to protect and promote the interest of the owners in all matters relating to the provision of services thereunder. The Company also contracts with various customers to carry out management services regarding engineering for vessel construction and vessel conversions. The vast majority of the ship management agreements span one to three years and are typically billed on a monthly basis. The Company transfers control of the service to the customer and satisfies its performance obligation over the term of the contract, and therefore recognizes revenue over the term of the contract while related costs are expensed as incurred.

Revenue that does not meet these criteria is deferred until the criteria is met and is considered a contract liability and is recognized as such. Contract liabilities, which are included in deferred revenue and unearned revenue in the accompanying consolidated balance sheets, for the six months ended June 30, 2022 and six months ended June 30, 2021 were as follows (in thousands):

 

 

 

2022

 

 

2021

 

Balance at beginning of period

 

$

321

 

 

$

3,307

 

Revenues deferred during the period

 

 

 

 

 

50

 

Revenues recognized and reclassifications during the period

 

 

(321

)

 

 

(1,374

)

Balance at end of period

 

$

 

 

$

1,983

 

 

As of June 30, 2022, the Company had no deferred revenues. As of June 30, 2022 and December 31, 2021, the Company had unearned revenue $1.4 million and $1.3 million, respectively, primarily related to mobilizations of vessels. The Company recorded $1.1 million of unearned revenue related to new contract agreements and recognized previously recorded unearned revenue of $1.0 million during the six months ended June 30, 2022.

Cash and Cash Equivalents. The Company considers all highly liquid investments, with an original maturity of three months or less from the date purchased, to be cash equivalents.

Restricted Cash. Restricted cash primarily relates to banking facility requirements.

Trade and Other Receivables. Customers are primarily major integrated national and international oil companies and large independent oil and natural gas exploration and production companies. Customers are granted credit on a short-term basis and the related credit risks are minimal. Other receivables consist primarily of operating expenses the Company incurs in relation to vessels it manages for other entities, as well as insurance and income tax receivables. The Company routinely reviews its receivables and makes provisions for

 

9


the credit losses utilizing the Current Expected Credit Losses model (CECL). The CECL model utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses for loans and other receivables at the time the financial asset is originated or acquired. However, those provisions are estimates and actual results may materially differ from those estimates. Trade receivables are deemed uncollectible and are removed from accounts receivable and the allowance for credit losses when collection efforts have been exhausted.

Property and Equipment. Equipment, stated at cost, is depreciated using the straight-line method over the estimated useful life of the asset to an estimated salvage value. With respect to each class of asset, the estimated useful life is based upon a newly built asset being placed into service and represents the time period beyond which it is typically not justifiable for the Company to continue to operate the asset in the same or similar manner. From time to time, the Company may acquire older vessels that have already exceeded the Company’s useful life policy, in which case the Company depreciates such assets based on its best estimate of remaining useful life, typically the next survey or certification date. As of June 30, 2022, the estimated useful life (in years) of the Company’s new Offshore Support Vessels was 20 years.

 

Equipment maintenance and repair costs and the costs of routine overhauls, drydockings and inspections performed on vessels and equipment are charged to operating expense as incurred. Expenditures that extend the useful life or improve the marketing and commercial characteristics of equipment as well as major renewals and improvements to other properties are capitalized.

 

Certain interest costs incurred during the construction of equipment are capitalized as part of the assets’ carrying values and are amortized over such assets estimated useful lives. There was no capitalized interest recognized during the six months ended June 30, 2022. During the six months ended June 30, 2021 capitalized interest totaled $0.3 million.

 

Impairment of Long-Lived Assets. The Company performs an impairment analysis of long-lived assets used in operations, including intangible assets, when indicators of impairment are present. These indicators may include a significant decrease in the market price of a long-lived asset or asset group, a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition, or a current period operating or cash flow loss combined with a history of operating or cash flow losses or a forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group. If the carrying values of the assets are not recoverable, as determined by their estimated future undiscounted cash flows, the estimated fair value of the assets or asset groups are compared to their current carrying values and impairment charges are recorded if the carrying value exceeds fair value.

 

For the six months ended June 30, 2022, the Company recorded impairment charges of $0.9 million for one fast support vessel (“FSV”) classified as held for sale during the first quarter of 2022 and sold during the second quarter of 2022. There were no impairments of other owned or leased-in vessels. For the six months ended June 30, 2021, the Company did not record an impairment on any owned or leased-in vessels. Estimated fair values for the Company owned vessels were established by independent appraisers based on researched market information, replacement cost information and other data.

For vessel classes and individual vessels with indicators of impairment as of June 30, 2022, the Company estimated that their future undiscounted cash flows exceeded their current carrying values. However, the Company’s estimates of future undiscounted cash flows are highly subjective as utilization and rates per day worked are uncertain, especially in light of the continued volatility in commodity prices, as well as the timing and cost of reactivating cold-stacked vessels. If market conditions continue to decline, changes in the Company’s expectations on future cash flows may result in recognizing additional impairment charges related to its long-lived assets in future periods. For any vessel or vessel class that has indicators of impairment and is deemed not recoverable through future operations, the Company determines the fair value of the vessel or vessel class. If the fair value determination is less than the carrying value of the vessel or vessel class, an

 

10


impairment is recognized to reduce the carrying value to fair value. Fair value determination is primarily accomplished by obtaining independent valuations of vessel or vessel classes from qualified third-party appraisers.

Impairment of 50% or Less Owned Companies. Investments in 50% or less owned companies are reviewed periodically to assess whether there is an other-than-temporary decline in the carrying value of the investment. In its evaluation, the Company considers, among other items, recent and expected financial performance and returns, impairments recorded by the investee and the capital structure of the investee. When the Company determines the estimated fair value of an investment is below carrying value and the decline is other-than-temporary, the investment is written down to its estimated fair value. Actual results may vary from the Company’s estimates due to the uncertainty regarding projected financial performance, the severity and expected duration of declines in value and the available liquidity in the capital markets to support the continuing operations of the investee, among other factors. Although the Company believes its assumptions and estimates are reasonable, the investee’s actual performance compared with the estimates could produce different results and lead to additional impairment charges in future periods. During the six months ended June 30, 2022 and 2021, the Company did not recognize any impairment charges related to its 50% or less owned companies.

Income Taxes. During the six months ended June 30, 2022, the Company’s effective income tax rate of 9.20% was primarily due to foreign taxes not creditable against U.S. income taxes and foreign losses for which there is no benefit in the U.S.

Accumulated Other Comprehensive Income (Loss). The components of accumulated other comprehensive loss were as follows (in thousands):

 

 

 

SEACOR Marine Holdings Inc.

Stockholders’ Equity

 

 

 

Foreign

Currency

Translation

Adjustments

 

 

Derivative

Gains (Losses) on

Cash Flow

Hedges, net

 

 

Total Other

Comprehensive

Income

 

December 31, 2021

 

$

10,783

 

 

$

(2,728

)

 

$

8,055

 

Other comprehensive (loss) income

 

 

(4,563

)

 

 

2,468

 

 

 

(2,095

)

Balance as of June 30, 2022

 

$

6,220

 

 

$

(260

)

 

$

5,960

 

 

Earnings (Loss) Per Share. Basic earnings/loss per share of Common Stock of the Company is computed based on the weighted average number of shares of Common Stock and warrants to purchase Common Stock at an exercise price of $0.01 per share (“Warrants”) issued and outstanding during the relevant periods. The Warrants are included in the basic earnings/loss per share of Common Stock because the shares issuable upon exercise of the Warrants are issuable for de minimis cash consideration and therefore not anti-dilutive. Diluted earnings/loss per share of Common Stock is computed based on the weighted average number of shares of Common Stock and Warrants issued and outstanding plus the effect of other potentially dilutive securities through the application of the treasury stock method and the if-converted method that assumes all shares of Common Stock have been issued and outstanding during the relevant periods pursuant to the conversion of the Convertible Senior Notes (as defined in “Note 4. Long-Term Debt”) unless anti-dilutive. 

The Company’s Convertible Senior Notes (“Convertible Senior Notes”) are currently convertible into 2,907,500 shares of Common Stock. For the three and six months ended June 30, 2022, diluted loss per share of Common Stock excluded 2,907,500 issuable upon conversion of the Convertible Senior Notes and exercise of the related Warrants as the effect of their inclusion in the computation would be anti-dilutive.

For the three months ended June 30, 2021, diluted earnings per share of Common Stock included 2,907,500 of the Convertible Senior Note Shares as the effect of their inclusion in the computation would be dilutive. For the six months ended June 30, 2021, diluted earnings per share of Common Stock excluded 2,907,500 of the Convertible Senior Note Shares as the effect of their inclusion in the computation would be antidilutive. The number of shares of Common Stock issuable upon conversion of the Convertible Senior Notes

 

11


and exercise of the related Warrants excluded from the calculation of diluted earnings/loss per share was incorrectly reported in certain prior periods as 2,183,708. This number of shares was adjusted in the period ended June 30, 2021 following revisions to the calculation.

In addition, for the three and six months ended June 30, 2022 diluted loss per share of Common Stock excluded 1,648,707 shares of restricted stock and 1,026,865 shares of Common Stock issuable upon exercise of outstanding stock options as the effect of their inclusion in the computation would be anti-dilutive.

For the three and six months ended June 30, 2021, diluted earnings per share of Common Stock included 2,294 and 813 shares of restricted stock, respectively, as their inclusion in the computation would be dilutive. For the three and six months ended June 30, 2021 diluted earnings per share of Common Stock excluded 1,134,947 and 1,136,428 shares of restricted stock, respectively, and 1,123,041 share of stock issuable upon exercise of outstanding stock options as their inclusion in the computation would be anti-dilutive.

Subsequent events. The Company has evaluated subsequent events through August 3, 2022the date the financial statements were issued. Any material subsequent events that occurred during this time have been properly recognized and/or disclosed in these financial statements.

2.

EQUIPMENT ACQUISITIONS AND DISPOSITIONS

 

During the six months ended June 30, 2022, capital expenditures were less than $0.1 million. There were no equipment deliveries during the six months ended June 30, 2022. During the six months ended June 30, 2022, the Company sold one FSV, one liftboat, which was previously removed from service, office space and other equipment for net cash proceeds of $6.7 million, after transaction costs, and a gain of $2.2 million, which included impairment charges of $0.9 million for the FSV classified as held for sale during the first quarter of 2022 and sold during the second quarter of 2022. During the six months ended June 30, 2021, the Company sold one PSV and three FSVs and reduced $22.5 million of debt with hull and machinery insurance proceeds for the liftboat SEACOR Power of $25.0 million, for a total of $30.1 million and gains of $20.9 million.

 

As of January 12, 2021, the Company recognized a gain on the sale of Windcat Workboats Holdings Ltd. (“Windcat Workboats”) of approximately $22.8 million, calculated as follows:

 

(In Thousands):

January 12, 2021

 

Total Proceeds Received

$

43,797

 

Transactions Fees and other Costs

 

1,562

 

Cash Sold

 

3,520

 

Total Net Proceeds

 

38,715

 

Less: Net Equity in Windcat Workboats, net of cash sold

 

15,790

 

Less: January Income on Discontinued Operations

 

169

 

Gain on Sale of Windcat Workboats

$

22,756

 

 

See “Note 12. Discontinued Operations” for additional information on the sale of Windcat Workboats.

 

3.

INVESTMENTS, AT EQUITY AND ADVANCES TO 50% OR LESS OWNED COMPANIES

 

Investments, at equity, and advances to 50% or less owned companies as of June 30, 2022 and December 31, 2021 were as follows (in thousands):

 

 

Ownership

 

 

2022

 

 

2021

 

MexMar

 

 

49.0

%

 

$

64,399

 

 

$

59,940

 

SEACOR Marlin

 

 

49.0

%

 

 

6,078

 

 

 

6,958

 

Offshore Vessel Holdings

 

 

49.0

%

 

 

3,186

 

 

 

1,847

 

Other

 

20.0% - 50.0%

 

 

 

2,260

 

 

 

2,982

 

 

 

 

 

 

 

$

75,923

 

 

$

71,727

 

 

 

12


 

4.

LONG-TERM DEBT

The Company’s long-term debt obligations as of June 30, 2022 and December 31, 2021 were as follows (in thousands):

 

 

 

June 30, 2022

 

 

December 31, 2021

 

Recourse long-term debt(1):

 

 

 

 

 

 

 

 

Convertible Senior Notes

 

$

125,000

 

 

$

125,000

 

SEACOR Marine Foreign Holdings Credit Facility

 

 

79,970

 

 

 

86,470

 

Sea-Cat Crewzer III Term Loan Facility

 

 

17,940

 

 

 

19,178

 

SEACOR Offshore Delta (f/k/a SEACOSCO) Acquisition Debt

 

 

16,205

 

 

 

18,705

 

SEACOR Delta (f/k/a SEACOSCO) Shipyard Financing

 

 

81,982

 

 

 

86,316

 

SEACOR Alpine Shipyard Financing

 

 

28,922

 

 

 

29,734

 

SEACOR 88/888 Term Loan

 

 

5,500

 

 

 

5,500

 

Tarahumara Shipyard Financing

 

 

6,500

 

 

 

6,500

 

SEACOR Offshore OSV

 

 

17,323

 

 

 

18,052

 

Total recourse long-term debt

 

 

379,342

 

 

 

395,455

 

Non-recourse long-term debt(2):

 

 

 

 

 

 

 

 

SEACOR 88/888 Term Loan

 

 

5,500

 

 

 

5,500

 

Total non-recourse long-term debt

 

 

5,500

 

 

 

5,500

 

Total principal due for long-term debt

 

 

384,842

 

 

 

400,955

 

Current portion due within one year

 

 

(33,398

)

 

 

(31,602

)

Unamortized debt discount

 

 

(29,971

)

 

 

(33,398

)

Deferred financing costs

 

 

(2,774

)

 

 

(3,193

)

Long-term debt, less current portion

 

$

318,699

 

 

$

332,762

 

 

(1)

Recourse debt represents debt issued by SEACOR Marine and/or its subsidiaries and guaranteed by SEACOR Marine or one of its operating subsidiaries as provided in the relevant debt agreements.

(2)

Non-recourse debt represents debt issued by one of the Company’s consolidated subsidiaries with no recourse to SEACOR Marine or its other non-debtor operating subsidiaries with respect to the applicable instrument, other than certain limited support obligations as provided in the respective debt agreements, which in aggregate are not considered to be material to the Company’s business and financial condition.

As of June 30, 2022, the Company was in compliance with all debt covenants and lender requirements.

SEACOR Marine Foreign Holdings Credit Facility. On June 15, 2022, SEACOR Marine, SEACOR Marine Foreign Holdings Inc., a wholly owned subsidiary of SEACOR Marine (“SMFH”), and certain vessel-owning subsidiaries of SEACOR Marine, entered into Amendment No. 4 (“SMFH Amendment No. 4”) to that certain $130.0 million loan facility with a syndicate of lenders administered by DNB Bank ASA, New York Branch, dated as of September 26, 2018 and as amended on August 6, 2019, November 26, 2019, December 13, 2019 and June 29, 2020 (the “SMFH Credit Facility”), and in connection therewith SEACOR Marine entered into the Amended and Restated Guaranty, dated as of June 15, 2022, by SEACOR Marine in favor of DNB Bank ASA, New York Branch, as security trustee (the “A&R SMFH Guaranty”).

SMFH Amendment No. 4 and the A&R SMFH Guaranty provide for, among other things, (i) an increase in the Margin (as defined in the SMFH Credit Facility) from 3.75% per annum to 4.75% per annum through December 31, 2022 at which point the Margin will revert to 3.75% and (ii) the modification of certain financial maintenance and restrictive covenants contained in the A&R SMFH Guaranty, including the amendment of the definition of Cash and Cash Equivalents (as defined in the A&R SMFH Guaranty) to include 35% of the accounts receivable as reported in SEACOR Marine’s financial statements for the second, third and fourth quarter of fiscal year 2022 and to amend the interest coverage ratio through December 31, 2022.

The A&R SMFH Guaranty requires the Company to maintain a minimum balance of Cash and Cash Equivalents equal to the greater of (i) $35.0 million and (ii) 7.5% of Total Debt (as defined in the A&R SMFH Guaranty). As of June 30, 2022, the Company's Cash and Cash Equivalents balance used to test compliance with this covenant was $45.3 million or 15.0% of Total Debt.

SEACOR 88/888 Term Loan Facility. On August 2, 2022, SEACOR Marine, SEACOR Offshore Eight LLC, a wholly-owned subsidiary of SEACOR Marine, and certain vessel owning wholly-owned subsidiaries of SEACOR Marine, entered into the 2022 Amendment to Loan Agreement and Guaranty (the “2022 88/888 Amendment”) to that certain senior secured loan agreement, dated as of July 5, 2018, with DNB Bank ASA,

 

13


New York Branch and DNB Capital LLC (as amended, the “SEACOR 88/888 Term Loan”). The SEACOR 88/888 Term Loan is secured by two vessels and SEACOR Marine has provided a limited guaranty of such loan under which claims recoverable from SEACOR Marine shall not exceed the lesser of (x) $5.5 million and (y) 50% of the obligations outstanding at the time a claim is made thereunder. The 2022 88/888 Amendment provides for, among other things, (i) the extension of the maturity date of the SEACOR 88/888 Term Loan from June 29, 2023 to July 1, 2024, and (ii) the amendment of the applicable interest rate margin over SOFR from 3.75% to 4.75%.

Letters of Credit. As of June 30, 2022, the Company had outstanding letters of credit of $1.1 million securing lease obligations, labor and performance guaranties.

 

5.

LEASES

As of June 30, 2022, the Company leased-in two anchor handling towing supply (“AHTS”) vessels, one FSV, and certain facilities and other equipment. The leases typically contain purchase and renewal options or rights of first refusal with respect to the sale or lease of the equipment. As of June 30, 2022, the remaining lease terms of the vessels had a duration ranging from 9 to 57 months. The lease terms of certain facilities and other equipment range in duration from 5 to 294 months.

As of June 30, 2022, future minimum payments for leases for the remainder of 2022 and the years ended December 31, noted below, were as follows (in thousands):

 

 

 

Operating Leases

 

 

Finance Leases

 

Remainder of 2022

 

$

1,201

 

 

$

228

 

2023

 

 

1,646

 

 

 

726

 

2024

 

 

464

 

 

 

946

 

2025

 

 

515

 

 

 

959

 

2026

 

 

459

 

 

 

953

 

Years subsequent to 2026

 

 

3,614

 

 

 

4,659

 

 

 

 

7,899

 

 

 

8,471

 

Interest component

 

 

(1,863

)

 

 

(1,139

)

 

 

 

6,036

 

 

 

7,332

 

Current portion of long-term lease liabilities

 

 

2,010

 

 

 

282

 

Long-term lease liabilities

 

$

4,026

 

 

$

7,050

 

 

For the six months ended June 30, 2022 and 2021 the components of lease expense were as follows (in thousands):

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Operating lease cost

 

$

789

 

 

$

950

 

 

$

1,697

 

 

$

1,855

 

Finance lease cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of finance lease assets (1)

 

 

163

 

 

 

1

 

 

 

222

 

 

 

9

 

Interest on finance lease liabilities (2)

 

 

76

 

 

 

1

 

 

 

101

 

 

 

1

 

Short-term lease costs

 

 

219

 

 

 

284

 

 

 

371

 

 

 

457

 

 

 

$

1,247

 

 

$

1,236

 

 

$

2,391

 

 

$

2,322

 

 

(1)Included in amortization costs in the consolidated statements of income (loss).

(2)Included in interest expense in the consolidated statements of income (loss).

 

For the six months ended June 30, 2022 supplemental cash flow information related to leases was as follows (in thousands):

 

 

 

2022

 

Operating cash outflows from operating leases

 

 

1,098

 

Financing cash outflows from finance leases

 

 

123

 

Right-of-use assets obtained for operating lease liabilities

 

 

163

 

Right-of-use assets obtained for finance lease liabilities

 

 

7,248

 

 

14


 

 

For the six months ended June 30, 2022 other information related to leases was as follows:

 

 

 

2022

 

Weighted average remaining lease term, in years - operating leases

 

 

10.7

 

Weighted average remaining lease term, in years - finance leases

 

 

4.7

 

Weighted average discount rate - operating leases

 

 

5.4

%

Weighted average discount rate - finance leases

 

 

4.0

%

 

 

6.

INCOME TAXES

The following table reconciles the difference between the statutory federal income tax rate for the Company and the effective income tax rate for the six months ended June 30, 2022:

 

Statutory rate

 

 

21.00

%

Foreign withholding tax and foreign losses for which there is no benefit in the U.S.

 

 

(11.53

)%

Other

 

 

(0.27

)%

Effective income tax rate

 

 

9.20

%

 

 

7.

DERIVATIVE INSTRUMENTS AND HEDGING STRATEGIES

Derivative instruments are classified as either assets or liabilities based on their individual fair values. The fair values of the Company’s derivative instruments were as follows (in thousands):

 

 

 

June 30, 2022

 

 

December 31, 2021

 

 

 

Derivative

Asset

 

 

Derivative

Liability

 

 

Derivative

Asset

 

 

Derivative

Liability

 

Derivatives designated as hedging instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate swap agreements (cash flow hedges)

 

$

 

 

$

24

 

 

$

 

 

$

1,831

 

 

 

 

 

 

 

24

 

 

 

 

 

 

1,831

 

Derivatives not designated as hedging instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Conversion option liability on Convertible Senior Notes

 

 

 

 

 

1

 

 

 

 

 

 

 

 

 

$

 

 

$

1

 

 

$

 

 

$

 

 

Economic Hedges. The Company enters and settles forward currency exchange, option and future contracts with respect to various foreign currencies. These contracts enable the Company to buy currencies in the future at fixed exchange rates, which could offset possible consequences of changes in currency exchange rates with respect to the Company’s business conducted outside of the U.S. The Company generally does not enter into contracts with forward settlement dates beyond twelve to eighteen months. As of June 30, 2022, the Company had no open forward currency exchange contracts.

Cash Flow Hedges. The Company and certain of its 50% or less owned companies have interest rate swap agreements designated as cash flow hedges. By entering into these interest rate swap agreements, the Company and its 50% or less owned companies have converted the variable LIBOR component of certain of their outstanding borrowings to a fixed interest rate. The Company recognized gains on derivative instruments designated as cash flow hedges of $1.8 million and $0.9 million for the six months ended June 30, 2022 and 2021, respectively, as a component of other comprehensive income (loss). As of June 30, 2022, the interest rate swaps held by the Company and certain of the Company’s 50% or less owned companies were as follows:

 

SMFH has an interest rate swap agreement maturing in 2023 that calls for SMFH to pay a fixed rate of interest of 3.32% per annum on the amortized notional value of $6.3 million and receive a variable interest rate based on LIBOR on the amortized notional value;

 

SMFH has an interest rate swap agreement maturing in 2023 that calls for SMFH to pay a fixed rate of interest of 3.195% per annum on the amortized notional value of $34.7 million and receive a variable interest rate based on LIBOR on the amortized notional value;

 

15


 

SEACOR 88 LLC and SEACOR 888 LLC, both indirect wholly-owned subsidiaries of SEACOR Marine (collectively, “SEACOR 88/888”), have an interest rate swap agreement maturing in 2023 that calls for SEACOR 88/888 to pay a fixed rate of interest of 3.175% per annum on the amortized notional value of $5.5 million and receive a variable interest rate based on LIBOR on the amortized notional value; and

 

Mantenimiento Express Maritimo, S.A.P.I. de C.V. (“MexMar”), in which the Company has a 49% noncontrolling interest, has three interest rate swap agreements with maturities in 2023 that call for MexMar to pay fixed rates of interest ranging from 1.71% to 2.10% per annum on the aggregate amortized notional value of $25.6 million and receive a variable interest rate based on LIBOR on the aggregate amortized notional value.

Other Derivative Instruments. The Company recognized (losses) gains on derivative instruments not designated as hedging instruments for the six months ended June 30, 2022 and 2021 as follows (in thousands):

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Conversion option liability on Convertible Senior Notes

 

$

33

 

 

$

30

 

 

$

(1

)

 

$

(5

)

Forward currency exchange, option, and future contracts

 

 

 

 

 

 

 

 

 

 

 

390

 

 

 

$

33

 

 

$

30

 

 

$

(1

)

 

$

385

 

 

The conversion option liability relates to the bifurcated embedded conversion option in the Convertible Senior Notes issued to investment funds managed and controlled by The Carlyle Group (see “Note 8. Fair Value Measurements”).

8.

FAIR VALUE MEASUREMENTS

The fair value of an asset or liability is the price that would be received to sell an asset or transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company utilizes a fair value hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value and defines three levels of inputs that may be used to measure fair value. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or inputs derived from observable market data. Level 3 inputs are unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities.

The Company’s financial assets and liabilities as of June 30, 2022 and December 31, 2021 that are measured at fair value on a recurring basis were as follows (in thousands):

 

June 30, 2022

 

Level 1

 

 

Level 2

 

 

Level 3

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

Derivative instruments

 

$

 

 

$

24

 

 

$

 

Conversion Option Liability on Convertible Senior Notes

 

 

 

 

 

 

 

 

1

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

Derivative instruments

 

$

 

 

$

1,831

 

 

$

 

 

Level 3 Measurement. The fair value of the conversion option liability embedded in the Convertible Senior Notes is estimated with significant inputs that are both observable and unobservable in the market and therefore is considered a Level 3 fair value measurement. The Company used a binomial lattice model that assumes the holders will maximize their value by finding the optimal decision between redeeming at the redemption price or converting into shares of Common Stock. This model estimates the fair value of the conversion option as the differential in the fair value of the notes including the conversion option compared with the fair value of the notes excluding the conversion option. The significant observable inputs used in the fair value measurement include the price of Common Stock and the risk-free interest rate. The significant

 

16


unobservable inputs are the estimated Company credit spread and Common Stock volatility, which were based on comparable companies in the transportation and energy industries.

The estimated fair values of the Company’s other financial assets and liabilities as of June 30, 2022 and December 31, 2021 were as follows (in thousands):

 

 

 

 

 

 

 

Estimated Fair Value

 

June 30, 2022

 

Carrying

Amount

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash

 

$

25,904

 

 

$

25,904

 

 

$

 

 

$

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term debt, including current portion

 

 

352,096

 

 

 

 

 

 

349,590

 

 

 

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash

 

$

41,220

 

 

$

41,220

 

 

$

 

 

$

 

LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term debt, including current portion

 

 

364,364

 

 

 

 

 

 

372,992

 

 

 

 

 

The carrying value of cash, cash equivalents and restricted cash approximates fair value. The fair value of the Company’s long-term debt was estimated based upon quoted market prices or by using discounted cash flow analysis based on estimated current rates for similar types of arrangements. Considerable judgment was required in developing certain of the estimates of fair value including the consideration of the COVID-19 pandemic as well as the economic effects of the conflict between Russia and Ukraine and the global inflationary environment, that have caused significant volatility in U.S. and international markets, and, accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange.

 

Property and equipment. During the six months ended June 30, 2022, the Company recognized impairment charges of $0.9 million related to one FSV classified as held for sale during the first quarter of 2022 and sold during the second quarter of 2022. During the year ended December 31, 2021, the Company recognized no impairment charges, and none of the Company’s property and equipment had a fair value based on ordinary liquidation value or indicative sales price.

 

9.

COMMITMENTS AND CONTINGENCIES

As of June 30, 2022, the Company had unfunded capital commitments of $1.1 million for miscellaneous vessel equipment, $0.3 million of which is payable during the remainder of 2022 and $0.8 million is payable during 2023. The Company has indefinitely deferred an additional $9.4 million of orders with respect to one FSV that the Company had previously reported as unfunded capital commitments.

In December 2015, the Brazilian Federal Revenue Office issued a tax-deficiency notice to Seabulk Offshore do Brasil Ltda, an indirect wholly-owned subsidiary of SEACOR Marine (“Seabulk Offshore do Brasil”), with respect to certain profit participation contributions (also known as “PIS”) and social security financing contributions (also known as “COFINS”) requirements alleged to be due from Seabulk Offshore do Brasil (“Deficiency Notice”) in respect of the period of January 2011 until December 2012. In January 2016, the Company administratively appealed the Deficiency Notice on the basis that, among other arguments, (i) such contributions were not applicable in the circumstances of a 70%/30% cost allocation structure, and (ii) the tax inspector had incorrectly determined that values received from outside of Brazil could not be classified as expense refunds. The initial appeal was dismissed by the Brazilian Federal Revenue Office and the Company appealed such dismissal and is currently awaiting an administrative trial. A local Brazilian law has been enacted that supports the Company’s position that such contribution requirements are not applicable, but it is uncertain whether such law will be taken into consideration with respect to administrative proceedings commenced prior to the enactment of the law. Accordingly, the success of Seabulk Offshore do Brasil in the administrative proceedings cannot be assured and the matter may need to be addressed through judicial court proceedings. The potential levy arising from the Deficiency Notice is R$19.6 million based on a historical potential levy of

 

17


R$12.87 million (USD $3.8 million and USD $2.5 million, respectively, based on the exchange rate as of June 30, 2022).

On April 13, 2021, the SEACOR Power, a liftboat owned by a subsidiary of the Company with nineteen individuals on board, capsized off the coast of Port Fourchon, Louisiana. The incident resulted in the death of several crew members, including the captain of the vessel and five other employees of the Company. The incident also resulted in the constructive total loss of the SEACOR Power. The Company is responsible for the salvage operations related to the vessel and is coordinating these efforts with the U.S. Coast Guard. The salvage operations are currently ongoing and the Company expects salvage costs to be covered by insurance proceeds.

The capsizing of the SEACOR Power garnered significant attention from the media as well as local, state and federal politicians. The National Transportation Safety Board (“NTSB”) and the U.S. Coast Guard are currently investigating the incident to determine the cause of the incident and the Company is fully cooperating with the investigations in all respects and continues to gather information about the incident. It is expected that the NTSB and U.S. Coast Guard investigations will take a significant period of time to complete. Numerous civil lawsuits have been filed against the Company and other third parties by the family members of deceased crew members and the surviving crew members employed by the Company or by the third parties. On June 2, 2021, the Company filed a Limitation of Liability Act complaint in federal court in the Eastern District of Louisiana (“Limitation Action”), which has the effect of enjoining all existing civil lawsuits and requiring the plaintiffs to file their claims relating to the capsizing of the SEACOR Power in the Limitation Action. There is significant uncertainty in the amount and timing of costs and potential liabilities relating to the incident involving the SEACOR Power, the impact the incident will have on the Company’s reputation and the resulting possible impact on the Company’s business.

In the normal course of its business, the Company becomes involved in various other litigation matters including, among others, claims by third parties for alleged property damages and personal injuries. Management has used estimates in determining the Company’s potential exposure to these matters and has recorded reserves in its financial statements related thereto where appropriate. It is possible that a change in the Company’s estimates of that exposure could occur, but the Company does not expect such changes in estimated costs would have a material effect on the Company’s consolidated financial position, results of operations or cash flows.

Certain of the Company’s subsidiaries are participating employers in two industry-wide, multi-employer, defined benefit pension funds in the United Kingdom: the U.K Merchant Navy Officers Pension Fund (“MNOPF”) and the U.K. Merchant Navy Ratings Pension Fund (“MNRPF”). The Company’s participation in the MNOPF began with the acquisition of the Stirling group of companies (the “Stirling Group”) in 2001 and relates to certain officers employed between 1978 and 2002 by the Stirling Group and/or its predecessors. The Company’s participation in the MNRPF also began with the acquisition of the Stirling Group in 2001 and relates to ratings employed by the Stirling Group and/or its predecessors through today. Both of these plans are in deficit positions and, depending upon the results of future actuarial valuations, it is possible that the plans could experience funding deficits that will require the Company to recognize payroll related operating expenses in the periods invoices are received. As of June 30, 2022, all invoices related to MNOPF and MNRPF have been settled in full.

On October 19, 2021, the Company was informed by the MNRPF that two issues had been identified during a review of the MNRPF by the applicable trustee that would potentially give rise to material additional liabilities for the MNRPF. The MNRPF has indicated that the investigations into these issues remain ongoing, and that further updates will be provided as significant developments arise. Should such additional liabilities require the MNRPF to collect additional funds from participating employers, it is possible that the Company will be invoiced for a portion of such funds and recognize payroll related operating expenses in the periods invoices are received.

 

18


10.

STOCK BASED COMPENSATION

Transactions in connection with the Company’s Equity Incentive Plans during the six months ended June 30, 2022 were as follows:

 

Restricted Stock Activity:

 

 

 

 

Outstanding as of December 31, 2021

 

 

1,163,090

 

Granted

 

 

999,619

 

Vested

 

 

514,002

 

Outstanding as of June 30, 2022 (1)

 

 

1,648,707

 

 

 

 

 

 

Stock Option Activity:

 

 

 

 

Outstanding as of December 31, 2021

 

 

1,061,357

 

Exercised

 

 

34,492

 

Outstanding as of June 30, 2022

 

 

1,026,865

 

 

(1)Excludes 253,158 grants of performance-based stock units that are not considered outstanding until such time that they become probable to vest.

For the six months ended June 30, 2022, the Company acquired for treasury 120,751 shares of Common Stock from its directors and/or employees to cover their tax withholding obligations upon the lapsing of restrictions on share awards for an aggregate purchase price of $0.7 million. These shares were purchased in accordance with the terms of the Company’s 2017 Equity Incentive Plan and the Company’s 2020 Equity Incentive Plan.

 

11.

SEGMENT INFORMATION

The Company’s segment presentation and basis of measurement of segment profit or loss are as previously described in the 2021 Annual Report. Certain reclassifications of prior period information have been made to conform the current period’s reportable segment presentation as a result of the Company’s presentation of Discontinued Operations (see “Note 12. Discontinued Operations”). The following tables summarize the operating results, capital expenditures and assets of the Company’s reportable segments for the periods indicated (in thousands):

 

 

United

States

(primarily

Gulf of

Mexico)

 

 

Africa

and Europe

 

 

Middle

East

and Asia

 

 

Latin

America

 

 

Total

 

For the Three Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

9,759

 

 

$

14,930

 

 

$

13,906

 

 

$

10,909

 

 

$

49,504

 

Bareboat charter

 

 

 

 

 

 

 

 

 

 

 

48

 

 

 

48

 

Other marine services

 

 

2,399

 

 

 

1,072

 

 

 

460

 

 

 

534

 

 

 

4,465

 

 

 

 

12,158

 

 

 

16,002

 

 

 

14,366

 

 

 

11,491

 

 

 

54,017

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

5,773

 

 

 

3,526

 

 

 

5,691

 

 

 

3,356

 

 

 

18,346

 

Repairs and maintenance

 

 

1,280

 

 

 

2,638

 

 

 

2,545

 

 

 

1,917

 

 

 

8,380

 

Drydocking

 

 

4,090

 

 

 

134

 

 

 

2,250

 

 

 

 

 

 

6,474

 

Insurance and loss reserves

 

 

1,198

 

 

 

329

 

 

 

748

 

 

 

270

 

 

 

2,545

 

Fuel, lubes and supplies

 

 

794

 

 

 

1,490

 

 

 

1,318

 

 

 

748

 

 

 

4,350

 

Other

 

 

281

 

 

 

1,871

 

 

 

1,213

 

 

 

685

 

 

 

4,050

 

 

 

 

13,416

 

 

 

9,988

 

 

 

13,765

 

 

 

6,976

 

 

 

44,145

 

Direct Vessel (Loss) Profit

 

$

(1,258

)

 

$

6,014

 

 

$

601

 

 

$

4,515

 

 

 

9,872

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

295

 

 

$

456

 

 

$

38

 

 

$

219

 

 

 

1,008

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,210

 

Depreciation and amortization

 

 

4,562

 

 

 

3,306

 

 

 

4,229

 

 

 

2,111

 

 

 

14,208

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25,426

 

Gain on Asset Dispositions, Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

Operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(15,529

)

 

19


 

 

 

 

United

States

(primarily

Gulf of

Mexico)

 

 

Africa

and Europe

 

 

Middle

East

and Asia

 

 

Latin

America

 

 

Total

 

For the Six Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

17,623

 

 

$

27,210

 

 

$

27,566

 

 

$

19,846

 

 

$

92,245

 

Bareboat charter

 

 

 

 

 

 

 

 

 

 

 

666

 

 

 

666

 

Other marine services

 

 

4,451

 

 

 

456

 

 

 

509

 

 

 

1,281

 

 

 

6,697

 

 

 

 

22,074

 

 

 

27,666

 

 

 

28,075

 

 

 

21,793

 

 

 

99,608

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

10,696

 

 

 

7,062

 

 

 

11,722

 

 

 

7,301

 

 

 

36,781

 

Repairs and maintenance

 

 

2,381

 

 

 

4,217

 

 

 

4,377

 

 

 

4,196

 

 

 

15,171

 

Drydocking

 

 

6,957

 

 

 

1,278

 

 

 

3,212

 

 

 

 

 

 

11,447

 

Insurance and loss reserves

 

 

1,427

 

 

 

453

 

 

 

1,255

 

 

 

596

 

 

 

3,731

 

Fuel, lubes and supplies

 

 

1,456

 

 

 

2,963

 

 

 

2,328

 

 

 

1,332

 

 

 

8,079

 

Other

 

 

505

 

 

 

3,699

 

 

 

2,840

 

 

 

1,388

 

 

 

8,432

 

 

 

 

23,422

 

 

 

19,672

 

 

 

25,734

 

 

 

14,813

 

 

 

83,641

 

Direct Vessel (Loss) Profit

 

$

(1,348

)

 

$

7,994

 

 

$

2,341

 

 

$

6,980

 

 

 

15,967

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

582

 

 

$

858

 

 

$

69

 

 

$

559

 

 

 

2,068

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20,134

 

Depreciation and amortization

 

 

9,200

 

 

 

6,564

 

 

 

8,574

 

 

 

4,241

 

 

 

28,579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

50,781

 

Gain on Asset Dispositions, Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,164

 

Operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(32,650

)

As of June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and Equipment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical Cost

 

$

269,717

 

 

$

247,967

 

 

$

322,091

 

 

$

160,372

 

 

$

1,000,147

 

Accumulated Depreciation

 

 

(130,737

)

 

 

(76,742

)

 

 

(89,634

)

 

 

(27,978

)

 

 

(325,091

)

 

 

$

138,980

 

 

$

171,225

 

 

$

232,457

 

 

$

132,394

 

 

$

675,056

 

Total Assets (1)

 

$

170,831

 

 

$

194,632

 

 

$

244,606

 

 

$

215,755

 

 

$

825,824

 

 

(1)

Total assets by region does not include corporate assets of $51.3 million as of June 30, 2022.

 

20


 

 

 

 

United

States

(primarily

Gulf of

Mexico)

 

 

Africa

and Europe (2)

 

 

Middle

East

and Asia

 

 

Latin

America

 

 

Total

 

For the Three Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

3,419

 

 

$

11,437

 

 

$

13,752

 

 

$

12,866

 

 

$

41,474

 

Bareboat charter

 

 

434

 

 

 

 

 

 

 

 

 

 

 

 

434

 

Other marine services

 

 

727

 

 

 

(224

)

 

 

31

 

 

 

357

 

 

 

891

 

 

 

 

4,580

 

 

 

11,213

 

 

 

13,783

 

 

 

13,223

 

 

 

42,799

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

1,528

 

 

 

4,253

 

 

 

5,378

 

 

 

3,194

 

 

 

14,353

 

Repairs and maintenance

 

 

389

 

 

 

2,195

 

 

 

2,806

 

 

 

1,569

 

 

 

6,959

 

Drydocking

 

 

777

 

 

 

374

 

 

 

1,185

 

 

 

456

 

 

 

2,792

 

Insurance and loss reserves

 

 

923

 

 

 

352

 

 

 

461

 

 

 

925

 

 

 

2,661

 

Fuel, lubes and supplies

 

 

245

 

 

 

887

 

 

 

1,081

 

 

 

680

 

 

 

2,893

 

Other

 

 

224

 

 

 

2,072

 

 

 

43

 

 

 

618

 

 

 

2,957

 

 

 

 

4,086

 

 

 

10,133

 

 

 

10,954

 

 

 

7,442

 

 

 

32,615

 

Direct Vessel Profit from Continuing Operations

 

$

494

 

 

$

1,080

 

 

$

2,829

 

 

$

5,781

 

 

$

10,184

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

703

 

 

$

270

 

 

$

35

 

 

$

226

 

 

$

1,234

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9,152

 

Depreciation and amortization

 

 

3,287

 

 

 

3,305

 

 

 

4,663

 

 

 

2,838

 

 

 

14,093

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,479

 

Gain on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22,653

 

Operating Income from Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

8,358

 

 

21


 

 

 

 

United

States

(primarily

Gulf of

Mexico)

 

 

Africa

and Europe, Continuing Operations (2)

 

 

Middle

East

and Asia

 

 

Latin

America

 

 

Total

 

For the Six Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

4,908

 

 

$

21,939

 

 

$

26,327

 

 

$

22,590

 

 

$

75,764

 

Bareboat charter

 

 

1,163

 

 

 

 

 

 

 

 

 

 

 

 

1,163

 

Other

 

 

1,273

 

 

 

(493

)

 

 

391

 

 

 

1,213

 

 

 

2,384

 

 

 

 

7,344

 

 

 

21,446

 

 

 

26,718

 

 

 

23,803

 

 

 

79,311

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

3,272

 

 

 

7,473

 

 

 

10,586

 

 

 

6,440

 

 

 

27,771

 

Repairs and maintenance

 

 

1,043

 

 

 

3,386

 

 

 

3,709

 

 

 

2,661

 

 

 

10,799

 

Drydocking

 

 

1,652

 

 

 

678

 

 

 

2,251

 

 

 

428

 

 

 

5,009

 

Insurance and loss reserves

 

 

1,450

 

 

 

785

 

 

 

1,163

 

 

 

1,221

 

 

 

4,619

 

Fuel, lubes and supplies

 

 

444

 

 

 

1,459

 

 

 

1,640

 

 

 

1,552

 

 

 

5,095

 

Other

 

 

301

 

 

 

2,651

 

 

 

1,187

 

 

 

1,490

 

 

 

5,629

 

 

 

 

8,162

 

 

 

16,432

 

 

 

20,536

 

 

 

13,792

 

 

 

58,922

 

Direct Vessel (Loss) Profit from Continuing Operations

 

$

(818

)

 

$

5,014

 

 

$

6,182

 

 

$

10,011

 

 

$

20,389

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

1,367

 

 

$

626

 

 

$

57

 

 

$

262

 

 

$

2,312

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17,763

 

Depreciation and amortization

 

 

7,451

 

 

 

6,612

 

 

 

9,373

 

 

 

5,455

 

 

 

28,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,966

 

Gain on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20,380

 

Operating Loss from Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(8,197

)

As of June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and Equipment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical Cost

 

$

175,606

 

 

$

240,032

 

 

$

374,979

 

 

$

181,650

 

 

$

972,267

 

Accumulated Depreciation

 

 

(105,923

)

 

 

(71,560

)

 

 

(81,338

)

 

 

(30,061

)

 

 

(288,882

)

 

 

$

69,683

 

 

$

168,472

 

 

$

293,641

 

 

$

151,589

 

 

$

683,385

 

Total Assets (1)

 

$

110,095

 

 

$

185,862

 

 

$

295,430

 

 

$

222,830

 

 

$

814,217

 

 

(1)

Total assets by region does not include corporate assets of $105.0 million as of June 30, 2021.

(2)

In prior periods Africa and Europe were reported as separate segments. Due to the sale of Windcat Workboats, the Company’s European operations are no longer analyzed by the chief operating decision maker on a standalone basis but rather as part of the Africa and Europe segment. As a result, for purposes of segment reporting European operations are now consolidated with Africa and reported as a consolidated segment and prior period information has been conformed to the new consolidated reporting segment.

 

The Company’s investments in 50% or less owned companies, which are accounted for under the equity method, also contribute to its consolidated results of operations. As of June 30, 2022, and 2021, the Company’s investments, at equity and advances to 50% or less owned companies in its other 50% or less owned companies were $75.9 million and $77.5 million, respectively. Equity in earnings gains of 50% or less owned companies for the six months ended June 30, 2022 and 2021 were $6.1 million and $6.3 million, respectively.

 

 

22


 

12.DISCONTINUED OPERATIONS

 

On January 12, 2021, the Company completed the sale of Windcat Workboats, which was previously classified as assets held for sale. The Company has no continuing involvement in this business, which is considered a strategic shift in the Company’s operations. During the first twelve days of 2021, the Company recognized $0.2 million in net income from operations of Windcat Workboats that was utilized to calculate the gain on the sale of Windcat Workboats. Summarized selected operating results of the Company’s assets held for sale and discontinued operations were as follows (in thousands):

 

 

 

Six Months Ended June 30,

 

 

 

2021

 

Windcat Workboats

 

 

 

 

Operating Revenues:

 

 

 

 

Time charter

 

$

903

 

Other revenue

 

 

70

 

 

 

 

973

 

Costs and Expenses:

 

 

 

 

Operating

 

 

578

 

Direct Vessel Profit

 

 

395

 

 

 

 

 

 

General and Administrative Expenses

 

 

238

 

Lease Expense

 

 

24

 

 

 

 

262

 

Operating Income

 

 

133

 

Other Income (Expense)

 

 

 

 

Interest income

 

 

2

 

Interest expense

 

 

(39

)

Foreign currency translation loss

 

 

89

 

 

 

 

52

 

Operating Income Before Equity Earnings of 50% or Less Owned Companies, Net of Tax

 

$

185

 

Income Tax Expense

 

 

 

Operating Income Before Equity Earnings of 50% or Less Owned Companies

 

$

185

 

Equity in Earnings (Losses) of 50% or Less Owned Companies, Net of Tax

 

 

(16

)

Net Income from Discontinued Operations

 

$

169

 

 

 

23


 

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Form 10-Q includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements concern management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters and involve significant known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of results to differ materially from any future results, performance or achievements discussed or implied by such forward-looking statements. Certain of these risks, uncertainties and other important factors are discussed in the Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Company’s 2021 Annual Report on Form 10-K and this Quarterly Report on Form 10-Q. However, it should be understood that it is not possible to identify or predict all such risks, uncertainties and factors, and others may arise from time to time. All of these forward-looking statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995. The words “anticipate,” “estimate,” “expect,” “project,” “intend,” “believe,” “plan,” “target,” “forecast” and similar expressions are intended to identify forward-looking statements Forward looking statements speak only as of the date of the document in which they are made. The Company disclaims any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based. It is advisable, however, to consult any further disclosures the Company makes on related subjects in its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission.

Overview

The following Management’s Discussion and Analysis (the “MD&A”) is intended to help the reader understand the Company’s financial condition and results of operations. The MD&A is provided as a supplement to, and should be read in conjunction with the unaudited consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in the 2021 Annual Report.

The Company provides global marine and support transportation services to offshore energy facilities worldwide. As of June 30, 2022, the Company and its joint ventures operated a diverse fleet of 80 support vessels, of which 58 were owned or leased-in, 20 were joint-ventured, and two were managed on behalf of unaffiliated third-parties. The primary users of the Company’s services are major integrated oil companies, large independent oil and natural gas exploration and production companies and emerging independent companies, as well as windfarm operators and installation contractors.

The Company and its joint ventures operate and manage a diverse fleet of offshore support vessels that (i) deliver cargo and personnel to offshore installations including wind farms, (ii) handle anchors and mooring equipment required to tether rigs to the seabed, and assist in placing them on location and moving them between regions, (iii) provide construction, well work-over, maintenance and decommissioning support and (iv) carry and launch equipment used underwater in drilling and well installation, maintenance, inspection and repair. Additionally, the Company’s vessels provide accommodations for technicians and specialists.

The Company operates its fleet in four principal geographic regions: the U.S., primarily in the Gulf of Mexico; Africa and Europe; the Middle East and Asia; and Latin America, primarily in Mexico, Brazil and Guyana. The Company’s vessels are highly mobile and regularly and routinely move between countries within a geographic region. In addition, the Company’s vessels are redeployed among geographic regions, subject to flag restrictions, as changes in market conditions dictate.

The number and type of vessels operated, their rates per day worked and their utilization levels are the key determinants of the Company’s operating results and cash flows. Unless a vessel is cold-stacked, there is little reduction in daily running costs for the vessels and, consequently, operating margins are most sensitive to changes in rates per day worked and utilization. The Company manages its fleet utilizing a global network of shore side support, administrative and finance personnel.

 

24


Offshore oil and natural gas market conditions are highly volatile. Prices deteriorated beginning in the second half of 2014 and continued to deteriorate when oil prices hit a thirteen-year low of less than $27 per barrel (on the New York Mercantile Exchange) in February 2016. Oil prices experienced unprecedented volatility during 2020 due to the COVID-19 pandemic and the related effects on the global economy, with the price per barrel going negative for a short period of time. Oil prices have steadily increased since the lows hit at the beginning of the COVID-19 pandemic and hit a multi-year high of $122 per barrel primarily as a result of the conflict between Russia and Ukraine as well as the related economic sanctions but have recently decreased to the mid $90 per barrel range. While the Company has experienced difficult market conditions over the past few years due to low and volatile oil and natural gas prices and the focus of oil and natural gas producing companies on cost and capital spending budget reductions, the increases since the lows experienced during the pandemic in oil and natural gas prices has led to an increase in utilization, day rates and customer inquiries about potential new charters. The Company continues to closely monitor the dynamics related to the COVID-19 pandemic so that it may adjust its operations if necessary.

Certain macro drivers somewhat independent of oil and natural gas prices may support the Company’s business, including: (i) underspending by oil and gas producers during the recent industry downturn leading to pent up demand for maintenance and growth capital expenditures; (ii) improved extraction technologies; and (iii) the need for offshore wind facilities support as the industry grows. While we expect that alternative forms of energy will continue to grow and add to the world’s energy mix especially as governments, supranational groups and various other parties focus on climate change causes and concerns, the Company believes that for the foreseeable future demand for gasoline and oil will be sustained, as will demand for electricity from natural gas. Some alternative forms of energy such as offshore wind facilities support some of the Company’s businesses and we expect such support to increase as development of such energy expands. Low oil prices and the subsequent decline in offshore exploration have forced many operators in the industry to restructure or liquidate assets. The Company continues to closely monitor the delivery of newly built offshore support vessels to the industry-wide fleet, which in the recent past contributed to an oversaturated market, thereby further lowering the demand for the Company’s existing offshore support vessel fleet. A continuation of (i) low customer exploration and drilling activity levels, and (ii) continued excess supply of offshore support vessels whether from laid up fleets or newly built vessels could, in isolation or together, have a material adverse effect on the Company’s business, financial position, results of operations, cash flows and growth prospects.

The Company adheres to a strategy of cold-stacking vessels (removing from active service) during periods of weak utilization in order to reduce the daily running costs of operating the fleet, primarily personnel, repairs and maintenance costs, as well as to defer some drydocking costs into future periods. The Company considers various factors in determining which vessels to cold-stack, including upcoming dates for regulatory vessel inspections and related docking requirements. The Company may maintain class certification on certain cold-stacked vessels, thereby incurring some drydocking costs while cold-stacked. Cold-stacked vessels are returned to active service when market conditions improve, or management anticipates improvement, typically leading to increased costs for drydocking, personnel, repair and maintenance in the periods immediately preceding the vessels’ return to active service. Depending on market conditions, vessels with similar characteristics and capabilities may be rotated between active service and cold-stack. On an ongoing basis, the Company reviews its cold-stacked vessels to determine if any should be designated as retired and removed from service based on the vessel’s physical condition, the expected costs to reactivate and restore class certification, if any, and its viability to operate within current and projected market conditions. As of June 30, 2022, three of the Company’s 58 owned and leased-in, in-service vessels were cold-stacked worldwide.

 

25


Recent Developments

SEACOR 88/888 Term Loan Facility. On August 2, 2022, SEACOR Marine, SEACOR Offshore Eight LLC, a wholly-owned subsidiary of SEACOR Marine, and certain vessel owning wholly-owned subsidiaries of SEACOR Marine, entered into the 2022 88/888 Amendment to the SEACOR 88/888 Term Loan. The SEACOR 88/888 Term Loan is secured by two vessels and SEACOR Marine has provided a limited guaranty of such loan under which claims recoverable from SEACOR Marine shall not exceed the lesser of (x) $5.5 million and (y) 50% of the obligations outstanding at the time a claim is made thereunder. The 2022 88/888 Amendment provides for, among other things, (i) the extension of the maturity date of the SEACOR 88/888 Term Loan from June 29, 2023 to July 1, 2024, and (ii) the amendment of the applicable interest rate margin over SOFR from 3.75% to 4.75%.

SEACOR Marine Foreign Holdings Credit Facility. On June 15, 2022, SEACOR Marine, SMFH, and certain vessel-owning subsidiaries of SEACOR Marine, entered into SMFH Amendment No. 4 to that certain SMFH Credit Facility and, in connection therewith, SEACOR Marine entered into the A&R SMFH Guaranty. SMFH Amendment No. 4 and the A&R SMFH Guaranty provide for, among other things, (i) an increase in the Margin from 3.75% per annum to 4.75% per annum through December 31, 2022 at which point the Margin will revert to 3.75% and (ii) the modification of certain financial maintenance and restrictive covenants contained in the guaranty provided by SEACOR Marine with respect to the SMFH Credit Facility, including to amend the definition of Cash and Cash Equivalents to include 35% of the accounts receivable as reported in SEACOR Marine’s financial statements for the second, third and fourth quarter of fiscal year 2022 and to amend the interest coverage ratio through December 31, 2022.

OSV Partners. SEACOR OSV PARTNERS I LP, a Delaware limited partnership (“OSV Partners I”), was a joint venture that owned and operated five PSVs for which the Company acted as one of the general partners and also held a limited partnership interest in. On December 31, 2021, pursuant an agreement and plan of merger (the “Merger Agreement”) among SEACOR Marine, SEACOR Offshore OSV LLC, a Delaware limited liability company and an indirect wholly-owned subsidiary of the Company (“SEACOR Offshore OSV”) and OSV Partners I, OSV Partners I merged with and into SEACOR Offshore OSV with SEACOR Offshore OSV surviving the merger (the “Merger”).

In connection with the consummation of the Merger, the Company issued an aggregate of 1,567,935 shares of common stock of the Company, par value $0.01 per share (the “Common Stock”), as follows:

 

(i)

531,872 shares of Common Stock as consideration for the Merger paid to OSV Partners I’s limited partners (other than the Company and its subsidiaries), and

 

(ii)

1,036,063 shares of Common Stock as payment to settle all amounts and other obligations outstanding under the Subordinated PIK Loan Agreement, dated September 28, 2018 (as amended on December 22, 2021, the “PIK Loan Agreement”) and paid to the former lenders thereunder (all of whom were limited partners of OSV Partners I).

 

26


In connection with the Merger, the Company and SEACOR Offshore OSV assumed and guaranteed approximately $18.1 million of OSV Partners I’s third-party indebtedness outstanding under the amended and restated senior secured term loan credit facility agreement dated as of September 28, 2018, by and among OSV Partners I and lenders and other parties thereto.

As a result of the Merger, the five 201’, 1,900 tons deadweight capacity, PSVs owned by OSV Partners I are now 100% owned by the Company, bringing the Company’s owned PSV fleet to 20. Of the five PSVs previously owned by OSV Partners I, three are U.S. flagged and currently located in the Gulf of Mexico, and two are Marshall Island flagged and currently located in the Middle East. As of December 31, 2021, these five PSVs had an average age of seven years.

Consolidated Results of Operations

The sections below provide an analysis of the Company’s results of operations for the three and six months (“Current Year Quarter” and “Current Year Six Months”) ended June 30, 2022 compared with the three and six months (“Prior Year Quarter” and “Prior Year Six Months”) ended June 30, 2021. For the periods indicated, the Company’s consolidated results of operations were as follows (in thousands, except statistics):

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

12,149

 

 

 

 

 

 

$

12,007

 

 

 

 

 

 

$

11,746

 

 

 

 

 

 

$

11,687

 

 

 

 

 

Fleet Utilization

 

 

77

%

 

 

 

 

 

 

67

%

 

 

 

 

 

 

73

%

 

 

 

 

 

 

61

%

 

 

 

 

Fleet Available Days

 

 

5,311

 

 

 

 

 

 

 

5,177

 

 

 

 

 

 

 

10,711

 

 

 

 

 

 

 

10,682

 

 

 

 

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

49,504

 

 

 

92

%

 

$

41,474

 

 

 

97

%

 

$

92,245

 

 

 

92

%

 

$

75,764

 

 

 

96

%

Bareboat charter

 

 

48

 

 

 

0

%

 

 

434

 

 

 

1

%

 

 

666

 

 

 

1

%

 

 

1,163

 

 

 

1

%

Other marine services

 

 

4,465

 

 

 

8

%

 

 

891

 

 

 

2

%

 

 

6,697

 

 

 

7

%

 

 

2,384

 

 

 

3

%

 

 

 

54,017

 

 

 

100

%

 

 

42,799

 

 

 

100

%

 

 

99,608

 

 

 

100

%

 

 

79,311

 

 

 

100

%

Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

18,346

 

 

 

34

%

 

 

14,353

 

 

 

34

%

 

 

36,781

 

 

 

37

%

 

 

27,771

 

 

 

35

%

Repairs and maintenance

 

 

8,380

 

 

 

16

%

 

 

6,959

 

 

 

16

%

 

 

15,171

 

 

 

15

%

 

 

10,799

 

 

 

14

%

Drydocking

 

 

6,474

 

 

 

12

%

 

 

2,792

 

 

 

7

%

 

 

11,447

 

 

 

11

%

 

 

5,009

 

 

 

6

%

Insurance and loss reserves

 

 

2,545

 

 

 

5

%

 

 

2,661

 

 

 

6

%

 

 

3,731

 

 

 

4

%

 

 

4,619

 

 

 

6

%

Fuel, lubes and supplies

 

 

4,350

 

 

 

8

%

 

 

2,893

 

 

 

7

%

 

 

8,079

 

 

 

8

%

 

 

5,095

 

 

 

6

%

Other

 

 

4,050

 

 

 

7

%

 

 

2,957

 

 

 

7

%

 

 

8,432

 

 

 

8

%

 

 

5,629

 

 

 

7

%

 

 

 

44,145

 

 

 

82

%

 

 

32,615

 

 

 

76

%

 

 

83,641

 

 

 

84

%

 

 

58,922

 

 

 

74

%

Lease expense - operating

 

 

1,008

 

 

 

2

%

 

 

1,234

 

 

 

3

%

 

 

2,068

 

 

 

2

%

 

 

2,312

 

 

 

3

%

Administrative and general

 

 

10,210

 

 

 

19

%

 

 

9,152

 

 

 

21

%

 

 

20,134

 

 

 

20

%

 

 

17,763

 

 

 

22

%

Depreciation and amortization

 

 

14,208

 

 

 

26

%

 

 

14,093

 

 

 

33

%

 

 

28,579

 

 

 

29

%

 

 

28,891

 

 

 

36

%

 

 

 

69,571

 

 

 

129

%

 

 

57,094

 

 

 

133

%

 

 

134,422

 

 

 

135

%

 

 

107,888

 

 

 

137

%

Gains on Asset Dispositions and Impairments, Net

 

 

25

 

 

 

0

%

 

 

22,653

 

 

 

53

%

 

 

2,164

 

 

 

2

%

 

 

20,380

 

 

 

26

%

Operating (Loss) Income

 

 

(15,529

)

 

 

(29

)%

 

 

8,358

 

 

 

20

%

 

 

(32,650

)

 

 

(33

)%

 

 

(8,197

)

 

 

(10

)%

Other (Expense) Income, Net

 

 

(5,637

)

 

 

(10

)%

 

 

54,191

 

 

 

127

%

 

 

(11,448

)

 

 

(11

)%

 

 

47,041

 

 

 

59

%

(Loss) Income from Continuing Operations Before Income Tax Benefit and Equity in Earnings of 50% or Less Owned Companies

 

 

(21,166

)

 

 

(39

)%

 

 

62,549

 

 

 

146

%

 

 

(44,098

)

 

 

(44

)%

 

 

38,844

 

 

 

49

%

Income Tax (Benefit) Expense

 

 

(1,634

)

 

 

(3

)%

 

 

15,915

 

 

 

37

%

 

 

(4,055

)

 

 

(4

)%

 

 

13,227

 

 

 

17

%

(Loss) Income from Continuing Operations Before Equity in Earnings of 50% or Less Owned Companies

 

 

(19,532

)

 

 

(36

)%

 

 

46,634

 

 

 

109

%

 

 

(40,043

)

 

 

(40

)%

 

 

25,617

 

 

 

32

%

Equity in Earnings Gains of 50% or Less Owned Companies

 

 

415

 

 

 

1

%

 

 

2,167

 

 

 

5

%

 

 

6,089

 

 

 

6

%

 

 

6,270

 

 

 

8

%

(Loss) Income from Continuing Operations

 

 

(19,117

)

 

 

(35

)%

 

 

48,801

 

 

 

114

%

 

 

(33,954

)

 

 

(34

)%

 

 

31,887

 

 

 

40

%

Income from discontinued operations, Net of Tax

 

 

 

 

 

%

 

 

 

 

 

%

 

 

 

 

 

%

 

 

22,925

 

 

 

29

%

Net (Loss) Income

 

 

(19,117

)

 

 

(35

)%

 

 

48,801

 

 

 

114

%

 

 

(33,954

)

 

 

(34

)%

 

 

54,812

 

 

 

69

%

Net Income attributable to Noncontrolling Interests in Subsidiaries

 

 

3

 

 

 

0

%

 

 

1

 

 

 

0

%

 

 

3

 

 

 

0

%

 

 

1

 

 

 

0

%

Net (Loss) Income attributable to SEACOR Marine Holdings Inc.

 

$

(19,120

)

 

 

(35

)%

 

$

48,800

 

 

 

114

%

 

$

(33,957

)

 

 

(34

)%

 

$

54,811

 

 

 

69

%

 

 

27


 

Direct Vessel Profit. Direct vessel profit (defined as operating revenues less operating expenses excluding leased-in equipment, “DVP”) is the Company’s measure of segment profitability. DVP is a critical financial measure used by the Company to analyze and compare the operating performance of its regions, without regard to financing decisions (depreciation and interest expense for owned vessels vs. lease expense for leased-in vessels). See “Note 11. Segment Information” to the Unaudited Consolidated Financial Statements included in Part I. Item 1. “Financial Statements” elsewhere in the Quarterly Report on Form 10-Q.

The following tables summarize the operating results and property and equipment for the Company’s reportable segments for the periods indicated (in thousands, except statistics):

 

 

 

United

States

(primarily

Gulf of

Mexico)

 

 

Africa

and Europe

 

 

Middle

East

and Asia (1)

 

 

Latin

America

 

 

Total

 

For the Three Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

17,792

 

 

$

11,279

 

 

$

9,673

 

 

$

14,263

 

 

$

12,149

 

Fleet Utilization

 

 

43

%

 

 

85

%

 

 

87

%

 

 

94

%

 

 

77

%

Fleet Available Days

 

 

1,277

 

 

 

1,567

 

 

 

1,651

 

 

 

816

 

 

 

5,311

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

9,759

 

 

$

14,930

 

 

$

13,906

 

 

$

10,909

 

 

$

49,504

 

Bareboat charter

 

 

 

 

 

 

 

 

 

 

 

48

 

 

 

48

 

Other marine services

 

 

2,399

 

 

 

1,072

 

 

 

460

 

 

 

534

 

 

 

4,465

 

 

 

 

12,158

 

 

 

16,002

 

 

 

14,366

 

 

 

11,491

 

 

 

54,017

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

5,773

 

 

 

3,526

 

 

 

5,691

 

 

 

3,356

 

 

 

18,346

 

Repairs and maintenance

 

 

1,280

 

 

 

2,638

 

 

 

2,545

 

 

 

1,917

 

 

 

8,380

 

Drydocking

 

 

4,090

 

 

 

134

 

 

 

2,250

 

 

 

 

 

 

6,474

 

Insurance and loss reserves

 

 

1,198

 

 

 

329

 

 

 

748

 

 

 

270

 

 

 

2,545

 

Fuel, lubes and supplies

 

 

794

 

 

 

1,490

 

 

 

1,318

 

 

 

748

 

 

 

4,350

 

Other

 

 

281

 

 

 

1,871

 

 

 

1,213

 

 

 

685

 

 

 

4,050

 

 

 

 

13,416

 

 

 

9,988

 

 

 

13,765

 

 

 

6,976

 

 

 

44,145

 

Direct Vessel (Loss) Profit

 

$

(1,258

)

 

$

6,014

 

 

$

601

 

 

$

4,515

 

 

 

9,872

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

295

 

 

$

456

 

 

$

38

 

 

$

219

 

 

 

1,008

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,210

 

Depreciation and amortization

 

 

4,562

 

 

 

3,306

 

 

 

4,229

 

 

 

2,111

 

 

 

14,208

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25,426

 

Gain on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

Operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(15,529

)

 

 

(1)

In the second quarter of 2022, the Company removed from service one specialty vessel in this region. Regional statistics reflect the removed from service status of this vessel.

 

28


 

 

 

United

States

(primarily

Gulf of

Mexico)

 

 

Africa

and Europe

 

 

Middle

East

and Asia (2)

 

 

Latin

America

 

 

Total

 

For the Six Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

16,740

 

 

$

10,666

 

 

$

9,775

 

 

$

13,885

 

 

$

11,746

 

Fleet Utilization

 

 

41

%

 

 

83

%

 

 

82

%

 

 

89

%

 

 

73

%

Fleet Available Days

 

 

2,591

 

 

 

3,066

 

 

 

3,451

 

 

 

1,603

 

 

 

10,711

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

17,623

 

 

$

27,210

 

 

$

27,566

 

 

$

19,846

 

 

$

92,245

 

Bareboat charter

 

 

 

 

 

 

 

 

 

 

 

666

 

 

 

666

 

Other marine services

 

 

4,451

 

 

 

456

 

 

 

509

 

 

 

1,281

 

 

 

6,697

 

 

 

 

22,074

 

 

 

27,666

 

 

 

28,075

 

 

 

21,793

 

 

 

99,608

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

10,696

 

 

 

7,062

 

 

 

11,722

 

 

 

7,301

 

 

 

36,781

 

Repairs and maintenance

 

 

2,381

 

 

 

4,217

 

 

 

4,377

 

 

 

4,196

 

 

 

15,171

 

Drydocking

 

 

6,957

 

 

 

1,278

 

 

 

3,212

 

 

 

 

 

 

11,447

 

Insurance and loss reserves

 

 

1,427

 

 

 

453

 

 

 

1,255

 

 

 

596

 

 

 

3,731

 

Fuel, lubes and supplies

 

 

1,456

 

 

 

2,963

 

 

 

2,328

 

 

 

1,332

 

 

 

8,079

 

Other

 

 

505

 

 

 

3,699

 

 

 

2,840

 

 

 

1,388

 

 

 

8,432

 

 

 

 

23,422

 

 

 

19,672

 

 

 

25,734

 

 

 

14,813

 

 

 

83,641

 

Direct Vessel (Loss) Profit

 

$

(1,348

)

 

$

7,994

 

 

$

2,341

 

 

$

6,980

 

 

 

15,967

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

582

 

 

$

858

 

 

$

69

 

 

$

559

 

 

 

2,068

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20,134

 

Depreciation and amortization

 

 

9,200

 

 

 

6,564

 

 

 

8,574

 

 

 

4,241

 

 

 

28,579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

50,781

 

Gain on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,164

 

Operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(32,650

)

As of June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and Equipment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical cost

 

$

269,717

 

 

$

247,967

 

 

$

322,091

 

 

$

160,372

 

 

$

1,000,147

 

Accumulated depreciation

 

 

(130,737

)

 

 

(76,742

)

 

 

(89,634

)

 

 

(27,978

)

 

 

(325,091

)

 

 

$

138,980

 

 

$

171,225

 

 

$

232,457

 

 

$

132,394

 

 

$

675,056

 

Total Assets (1)

 

$

170,831

 

 

$

194,632

 

 

$

244,606

 

 

$

215,755

 

 

$

825,824

 

 

 

(1)

Total assets by region does not include corporate assets of $51.3 million as of June 30, 2022.

 

(2)

In the second quarter of 2022, the Company removed from service one specialty vessel in this region. Regional statistics reflect the removed from service status of this vessel.

 

29


 

 

 

United

States

(primarily

Gulf of

Mexico) (1)

 

 

Africa

and Europe (2)

 

 

Middle

East

and Asia

 

 

Latin

America

 

 

Total

 

For the Three Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

17,058

 

 

$

11,231

 

 

$

9,292

 

 

$

17,034

 

 

$

12,007

 

Fleet Utilization

 

 

18

%

 

 

75

%

 

 

81

%

 

 

86

%

 

 

67

%

Fleet Available Days

 

 

1,112

 

 

 

1,365

 

 

 

1,820

 

 

 

880

 

 

 

5,177

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

3,419

 

 

$

11,437

 

 

$

13,752

 

 

$

12,866

 

 

$

41,474

 

Bareboat charter

 

 

434

 

 

 

 

 

 

 

 

 

 

 

 

434

 

Other

 

 

727

 

 

 

(224

)

 

 

31

 

 

 

357

 

 

 

891

 

 

 

 

4,580

 

 

 

11,213

 

 

 

13,783

 

 

 

13,223

 

 

 

42,799

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

1,528

 

 

 

4,253

 

 

 

5,378

 

 

 

3,194

 

 

 

14,353

 

Repairs and maintenance

 

 

389

 

 

 

2,195

 

 

 

2,806

 

 

 

1,569

 

 

 

6,959

 

Drydocking

 

 

777

 

 

 

374

 

 

 

1,185

 

 

 

456

 

 

 

2,792

 

Insurance and loss reserves

 

 

923

 

 

 

352

 

 

 

461

 

 

 

925

 

 

 

2,661

 

Fuel, lubes and supplies

 

 

245

 

 

 

887

 

 

 

1,081

 

 

 

680

 

 

 

2,893

 

Other

 

 

224

 

 

 

2,072

 

 

 

43

 

 

 

618

 

 

 

2,957

 

 

 

 

4,086

 

 

 

10,133

 

 

 

10,954

 

 

 

7,442

 

 

 

32,615

 

Direct Vessel Profit from Continuing Operations

 

$

494

 

 

$

1,080

 

 

$

2,829

 

 

$

5,781

 

 

 

10,184

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

703

 

 

$

270

 

 

$

35

 

 

$

226

 

 

 

1,234

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9,152

 

Depreciation and amortization

 

 

3,287

 

 

 

3,305

 

 

 

4,663

 

 

 

2,838

 

 

 

14,093

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,479

 

Gains on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22,653

 

Operating Income from Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

8,358

 

 

(1)

As of June 30, 2021, the Company removed from service four liftboats in this region. Regional statistics reflect the removed from service status of these vessels.

 

(2)

In prior periods Africa and Europe were reported as separate segments. Due to the sale of Windcat Workboats, the Company’s European operations are no longer analyzed by the chief operating decision maker on a standalone basis but rather are analyzed as part of the Africa and Europe segment. As a result, for purposes of segment reporting European operations are now analyzed with Africa and reported as a consolidated segment.

 

30


 

 

 

United

States

(primarily

Gulf of

Mexico) (2)

 

 

Africa

and Europe (3)

 

 

Middle

East

and Asia

 

 

Latin

America

 

 

Total

 

For the Six Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

16,692

 

 

$

11,291

 

 

$

9,300

 

 

$

15,970

 

 

$

11,687

 

Fleet Utilization

 

 

11

%

 

 

71

%

 

 

77

%

 

 

85

%

 

 

61

%

Fleet Available Days

 

 

2,630

 

 

 

2,721

 

 

 

3,672

 

 

 

1,659

 

 

 

10,682

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

4,908

 

 

$

21,939

 

 

$

26,327

 

 

$

22,590

 

 

$

75,764

 

Bareboat charter

 

 

1,163

 

 

 

 

 

 

 

 

 

 

 

 

1,163

 

Other

 

 

1,273

 

 

 

(493

)

 

 

391

 

 

 

1,213

 

 

 

2,384

 

 

 

 

7,344

 

 

 

21,446

 

 

 

26,718

 

 

 

23,803

 

 

 

79,311

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

3,272

 

 

 

7,473

 

 

 

10,586

 

 

 

6,440

 

 

 

27,771

 

Repairs and maintenance

 

 

1,043

 

 

 

3,386

 

 

 

3,709

 

 

 

2,661

 

 

 

10,799

 

Drydocking

 

 

1,652

 

 

 

678

 

 

 

2,251

 

 

 

428

 

 

 

5,009

 

Insurance and loss reserves

 

 

1,450

 

 

 

785

 

 

 

1,163

 

 

 

1,221

 

 

 

4,619

 

Fuel, lubes and supplies

 

 

444

 

 

 

1,459

 

 

 

1,640

 

 

 

1,552

 

 

 

5,095

 

Other

 

 

301

 

 

 

2,651

 

 

 

1,187

 

 

 

1,490

 

 

 

5,629

 

 

 

 

8,162

 

 

 

16,432

 

 

 

20,536

 

 

 

13,792

 

 

 

58,922

 

Direct Vessel (Loss) Profit from Continuing Operations

 

$

(818

)

 

$

5,014

 

 

$

6,182

 

 

$

10,011

 

 

$

20,389

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

1,367

 

 

$

626

 

 

$

57

 

 

$

262

 

 

$

2,312

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17,763

 

Depreciation and amortization

 

 

7,451

 

 

 

6,612

 

 

 

9,373

 

 

 

5,455

 

 

 

28,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,966

 

Gains on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20,380

 

Operating Loss from Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(8,197

)

As of June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and Equipment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical cost

 

$

175,606

 

 

$

240,032

 

 

$

374,979

 

 

$

181,650

 

 

 

972,267

 

Accumulated depreciation

 

 

(105,923

)

 

 

(71,560

)

 

 

(81,338

)

 

 

(30,061

)

 

 

(288,882

)

 

 

$

69,683

 

 

$

168,472

 

 

$

293,641

 

 

$

151,589

 

 

$

683,385

 

Total Assets (1)

 

$

110,095

 

 

$

185,862

 

 

$

295,430

 

 

$

222,830

 

 

$

814,217

 

 

 

(1)

Total assets by region does not include corporate assets of $105.0 million as of June 30, 2021.

 

(2)

As of June 30, 2021, the Company removed from service four liftboats in this region. Regional statistics reflect the removed from service status of these vessels.

 

(3)

In prior periods Africa and Europe were reported as separate segments. Due to the sale of Windcat Workboats, the Company’s European operations are no longer analyzed by the chief operating decision maker on a standalone basis but rather are analyzed as part of the Africa and Europe segment. As a result, for purposes of segment reporting European operations are now analyzed with Africa and reported as a consolidated segment.

 

 

31


 

For additional information, the following tables summarize the world-wide operating results and property and equipment for each of the Company’s vessel classes for the periods indicated (in thousands, except statistics):

 

 

 

Anchor

handling

towing

supply

 

 

Fast

support

 

 

Supply

 

 

Liftboats

 

 

Other

activity (1)

 

 

Total

 

For the Three Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

8,887

 

 

$

9,201

 

 

$

13,422

 

 

$

24,712

 

 

$

 

 

$

12,149

 

Fleet Utilization

 

 

66

%

 

 

85

%

 

 

86

%

 

 

44

%

 

 

%

 

 

77

%

Fleet Available Days

 

 

546

 

 

 

2,126

 

 

 

1,820

 

 

 

819

 

 

$

 

 

 

5,311

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

3,191

 

 

$

16,525

 

 

$

20,983

 

 

$

8,805

 

 

$

 

 

$

49,504

 

Bareboat charter

 

 

 

 

 

 

 

 

48

 

 

 

 

 

 

 

 

 

48

 

Other marine services

 

 

(143

)

 

 

(174

)

 

 

575

 

 

 

3,283

 

 

 

924

 

 

 

4,465

 

 

 

 

3,048

 

 

 

16,351

 

 

 

21,606

 

 

 

12,088

 

 

 

924

 

 

 

54,017

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

1,050

 

 

 

4,880

 

 

 

7,889

 

 

 

4,515

 

 

 

12

 

 

 

18,346

 

Repairs and maintenance

 

 

566

 

 

 

2,458

 

 

 

3,184

 

 

 

2,132

 

 

 

40

 

 

 

8,380

 

Drydocking

 

 

(30

)

 

 

(201

)

 

 

(32

)

 

 

6,737

 

 

 

 

 

 

6,474

 

Insurance and loss reserves

 

 

146

 

 

 

372

 

 

 

551

 

 

 

1,548

 

 

 

(72

)

 

 

2,545

 

Fuel, lubes and supplies

 

 

215

 

 

 

1,187

 

 

 

1,701

 

 

 

1,230

 

 

 

17

 

 

 

4,350

 

Other

 

 

435

 

 

 

1,311

 

 

 

1,631

 

 

 

655

 

 

 

18

 

 

 

4,050

 

 

 

 

2,382

 

 

 

10,007

 

 

 

14,924

 

 

 

16,817

 

 

 

15

 

 

 

44,145

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

450

 

 

$

 

 

$

154

 

 

$

 

 

$

404

 

 

$

1,008

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,210

 

Depreciation and amortization

 

 

495

 

 

 

5,010

 

 

 

3,785

 

 

 

4,870

 

 

 

48

 

 

 

14,208

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25,426

 

Gains on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

Operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(15,529

)

 

(1)

In the second quarter of 2022, the Company removed from service one specialty vessel. Other activity statistics reflect the removed from service status of this vessel.

 

32


 

 

 

Anchor

handling

towing

supply

 

 

Fast

support

 

 

Supply

 

 

Liftboats

 

 

Other

activity (1)

 

 

Total

 

For the Six Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

8,898

 

 

$

8,917

 

 

$

12,862

 

 

$

23,507

 

 

$

 

 

$

11,746

 

Fleet Utilization

 

 

66

%

 

 

82

%

 

 

79

%

 

 

46

%

 

 

%

 

 

73

%

Fleet Available Days

 

 

1,086

 

 

 

4,286

 

 

 

3,620

 

 

 

1,629

 

 

 

90

 

 

 

10,711

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

6,379

 

 

$

31,425

 

 

$

36,806

 

 

$

17,635

 

 

$

 

 

$

92,245

 

Bareboat charter

 

 

 

 

 

 

 

 

666

 

 

 

 

 

 

 

 

 

666

 

Other marine services

 

 

(303

)

 

 

(428

)

 

 

619

 

 

 

4,746

 

 

 

2,063

 

 

 

6,697

 

 

 

 

6,076

 

 

 

30,997

 

 

 

38,091

 

 

 

22,381

 

 

 

2,063

 

 

 

99,608

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

2,186

 

 

 

9,950

 

 

 

16,082

 

 

 

8,550

 

 

 

13

 

 

 

36,781

 

Repairs and maintenance

 

 

859

 

 

 

4,258

 

 

 

6,885

 

 

 

3,144

 

 

 

25

 

 

 

15,171

 

Drydocking

 

 

(37

)

 

 

1,076

 

 

 

1,270

 

 

 

9,138

 

 

 

 

 

 

11,447

 

Insurance and loss reserves

 

 

9

 

 

 

632

 

 

 

979

 

 

 

2,763

 

 

 

(652

)

 

 

3,731

 

Fuel, lubes and supplies

 

 

359

 

 

 

2,731

 

 

 

3,135

 

 

 

1,835

 

 

 

19

 

 

 

8,079

 

Other

 

 

874

 

 

 

3,252

 

 

 

2,979

 

 

 

1,299

 

 

 

28

 

 

 

8,432

 

 

 

 

4,250

 

 

 

21,899

 

 

 

31,330

 

 

 

26,729

 

 

 

(567

)

 

 

83,641

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

899

 

 

$

 

 

$

445

 

 

$

 

 

$

724

 

 

$

2,068

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20,134

 

Depreciation and amortization

 

 

989

 

 

 

9,955

 

 

 

7,571

 

 

 

9,834

 

 

 

230

 

 

 

28,579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

50,781

 

Gains on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,164

 

Operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(32,650

)

As of June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and Equipment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical cost

 

$

50,189

 

 

$

355,116

 

 

$

282,304

 

 

$

290,529

 

 

$

22,009

 

 

$

1,000,147

 

Accumulated depreciation

 

 

(34,746

)

 

 

(121,226

)

 

 

(28,227

)

 

 

(119,351

)

 

 

(21,541

)

 

 

(325,091

)

 

 

$

15,443

 

 

$

233,890

 

 

$

254,077

 

 

$

171,178

 

 

$

468

 

 

$

675,056

 

 

(1)

In the second quarter of 2022, the Company removed from service one specialty vessel. Other activity statistics reflect the removed from service status of this vessel.

 

33


 

 

 

Anchor

handling

towing

supply

 

 

Fast

support

 

 

Supply

 

 

Specialty

 

 

Liftboats (1)

 

 

Other

activity

 

 

Total

 

For the Three Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

11,268

 

 

$

7,962

 

 

$

11,921

 

 

$

1,571

 

 

$

25,334

 

 

$

 

 

$

12,007

 

Fleet Utilization

 

 

59

%

 

 

71

%

 

 

80

%

 

 

92

%

 

 

46

%

 

 

%

 

 

67

%

Fleet Available Days

 

 

546

 

 

 

2,100

 

 

 

1,274

 

 

 

91

 

 

 

1,167

 

 

 

 

 

 

5,177

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

3,640

 

 

$

11,827

 

 

$

12,179

 

 

$

131

 

 

$

13,697

 

 

$

 

 

$

41,474

 

Bareboat charter

 

 

 

 

 

434

 

 

 

 

 

$

 

 

 

 

 

 

 

 

 

434

 

Other marine services

 

 

(157

)

 

 

(249

)

 

 

117

 

 

 

23

 

 

 

688

 

 

 

469

 

 

 

891

 

 

 

 

3,483

 

 

 

12,012

 

 

 

12,296

 

 

 

154

 

 

 

14,385

 

 

 

469

 

 

 

42,799

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

1,513

 

 

 

4,802

 

 

 

4,044

 

 

 

99

 

 

 

3,916

 

 

 

(21

)

 

 

14,353

 

Repairs and maintenance

 

 

471

 

 

 

3,618

 

 

 

2,039

 

 

 

104

 

 

 

716

 

 

 

11

 

 

 

6,959

 

Drydocking

 

 

1,322

 

 

 

1,178

 

 

 

180

 

 

 

 

 

 

112

 

 

 

 

 

 

2,792

 

Insurance and loss reserves

 

 

99

 

 

 

507

 

 

 

436

 

 

 

5

 

 

 

1,752

 

 

 

(138

)

 

 

2,661

 

Fuel, lubes and supplies

 

 

344

 

 

 

1,154

 

 

 

1,034

 

 

 

5

 

 

 

353

 

 

 

3

 

 

 

2,893

 

Other

 

 

444

 

 

 

1,640

 

 

 

884

 

 

 

33

 

 

 

(58

)

 

 

14

 

 

 

2,957

 

 

 

 

4,193

 

 

 

12,899

 

 

 

8,617

 

 

 

246

 

 

 

6,791

 

 

 

(131

)

 

 

32,615

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

362

 

 

$

352

 

 

$

 

 

$

 

 

$

205

 

 

$

315

 

 

 

1,234

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9,152

 

Depreciation and amortization

 

 

495

 

 

 

4,931

 

 

 

2,936

 

 

 

 

 

 

5,171

 

 

 

560

 

 

 

14,093

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,479

 

Gains on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22,653

 

Operating Income for Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

8,358

 

 

(1)

As of June 30, 2021, the Company removed from service four liftboats in this class. Liftboat statistics reflect the removed from service status of these vessels.

 

34


 

 

 

 

 

Anchor

handling

towing

supply

 

 

Fast

support

 

 

Supply

 

 

Specialty

 

 

Liftboats (1)

 

 

Other

activity

 

 

Total

 

For the Six Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Rates Per Day

 

$

9,429

 

 

$

7,927

 

 

$

12,006

 

 

$

1,736

 

 

$

25,950

 

 

$

 

 

$

11,687

 

Fleet Utilization

 

 

63

%

 

 

66

%

 

 

72

%

 

 

96

%

 

 

37

%

 

 

%

 

 

61

%

Fleet Available Days

 

 

1,086

 

 

 

4,306

 

 

 

2,593

 

 

 

181

 

 

 

2,517

 

 

 

 

 

 

10,682

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

6,441

 

 

$

22,484

 

 

$

22,261

 

 

$

301

 

 

$

24,277

 

 

$

 

 

$

75,764

 

Bareboat charter

 

 

 

 

 

1,163

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,163

 

Other marine services

 

 

(287

)

 

 

(467

)

 

 

463

 

 

 

35

 

 

 

1,485

 

 

 

1,155

 

 

 

2,384

 

 

 

 

6,154

 

 

 

23,180

 

 

 

22,724

 

 

 

336

 

 

 

25,762

 

 

 

1,155

 

 

 

79,311

 

Direct Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

2,497

 

 

 

8,843

 

 

 

8,202

 

 

 

188

 

 

 

7,722

 

 

 

319

 

 

 

27,771

 

Repairs and maintenance

 

 

712

 

 

 

5,153

 

 

 

3,174

 

 

 

112

 

 

 

1,610

 

 

 

38

 

 

 

10,799

 

Drydocking

 

 

1,376

 

 

 

2,356

 

 

 

290

 

 

 

 

 

 

987

 

 

 

 

 

 

5,009

 

Insurance and loss reserves

 

 

293

 

 

 

973

 

 

 

910

 

 

 

9

 

 

 

2,471

 

 

 

(37

)

 

 

4,619

 

Fuel, lubes and supplies

 

 

483

 

 

 

1,880

 

 

 

2,037

 

 

 

13

 

 

 

673

 

 

 

9

 

 

 

5,095

 

Other

 

 

714

 

 

 

2,781

 

 

 

1,764

 

 

 

59

 

 

 

619

 

 

 

(308

)

 

 

5,629

 

 

 

 

6,075

 

 

 

21,986

 

 

 

16,377

 

 

 

381

 

 

 

14,082

 

 

 

21

 

 

 

58,922

 

Other Costs and Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease expense

 

$

762

 

 

$

704

 

 

$

 

 

$

 

 

$

217

 

 

$

629

 

 

 

2,312

 

Administrative and general

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17,763

 

Depreciation and amortization

 

 

989

 

 

 

10,027

 

 

 

5,913

 

 

 

 

 

 

10,830

 

 

 

1,132

 

 

 

28,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,966

 

Gains on Asset Dispositions and Impairments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20,380

 

Operating Loss for Continuing Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(8,197

)

As of June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property and Equipment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical cost

 

$

50,189

 

 

$

363,021

 

 

$

229,218

 

 

$

3,163

 

 

$

303,278

 

 

$

23,398

 

 

$

972,267

 

Accumulated depreciation

 

 

(32,768

)

 

 

(107,298

)

 

 

(14,352

)

 

 

(3,138

)

 

 

(111,673

)

 

 

(19,653

)

 

 

(288,882

)

 

 

$

17,421

 

 

$

255,723

 

 

$

214,866

 

 

$

25

 

 

$

191,605

 

 

$

3,745

 

 

$

683,385

 

 

(1)

As of June 30, 2021, the Company removed from service four liftboats in this class. Liftboat statistics reflect the removed from service status of these vessels.

 

Fleet Counts. The Company’s fleet count as of June 30, 2022 and December 31, 2021 was as follows:

 

 

 

Owned

 

 

Joint Ventured

 

 

Leased-in

 

 

Managed

 

 

Total

 

June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

4

 

 

 

 

 

 

2

 

 

 

 

 

 

6

 

FSV

 

 

22

 

 

 

5

 

 

 

1

 

 

 

2

 

 

 

30

 

Supply

 

 

20

 

 

 

15

 

 

 

 

 

 

 

 

 

35

 

Liftboats

 

 

9

 

 

 

 

 

 

 

 

 

 

 

 

9

 

 

 

 

55

 

 

 

20

 

 

 

3

 

 

 

2

 

 

 

80

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

4

 

 

 

 

 

 

2

 

 

 

 

 

 

6

 

FSV

 

 

23

 

 

 

5

 

 

 

1

 

 

 

1

 

 

 

30

 

Supply

 

 

20

 

 

 

15

 

 

 

 

 

 

 

 

 

35

 

Specialty (1)

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

1

 

Liftboats (2)

 

 

9

 

 

 

 

 

 

 

 

 

 

 

 

9

 

 

 

 

57

 

 

 

20

 

 

 

3

 

 

 

1

 

 

 

81

 

 

 

(1)

One owned vessel classified as a Crew Transfer Continuing Operations as of December 31, 2020 was reclassified as a specialty vessel as of January 12, 2021 and removed from service in the second quarter of 2022. Removed from service vessels are not counted in active fleet count.

 

(2)

In the second quarter of 2021, the Company removed from service four liftboats. Removed from service vessels are not counted in active fleet count.

 

 

35


 

Operating Income (Loss)

United States, primarily Gulf of Mexico. For the three and six months ended June 30, 2022 and 2021 the Company’s time charter statistics and direct vessel profit (loss) in the United States was as follows (in thousands, except statistics):

 

 

 

For the Three Months Ended June 30,

 

 

For the Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rates Per Day Worked:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

$

 

 

 

 

 

 

$

37,500

 

 

 

 

 

 

$

 

 

 

 

 

 

$

37,500

 

 

 

 

 

FSV

 

 

11,035

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,950

 

 

 

 

 

 

 

 

 

 

 

 

Supply

 

 

16,536

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15,728

 

 

 

 

 

 

 

 

 

 

 

 

Liftboats

 

 

22,875

 

 

 

 

 

 

 

13,209

 

 

 

 

 

 

 

20,401

 

 

 

 

 

 

 

14,290

 

 

 

 

 

Overall

 

 

17,792

 

 

 

 

 

 

 

17,058

 

 

 

 

 

 

 

16,740

 

 

 

 

 

 

 

16,692

 

 

 

 

 

Utilization:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

 

 

 

 

%

 

 

 

 

 

 

17

%

 

 

 

 

 

 

%

 

 

 

 

 

 

9

%

FSV

 

 

 

 

 

 

48

%

 

 

 

 

 

 

%

 

 

 

 

 

 

42

%

 

 

 

 

 

 

%

Supply

 

 

 

 

 

 

71

%

 

 

 

 

 

 

%

 

 

 

 

 

 

66

%

 

 

 

 

 

 

%

Liftboats (1)

 

 

 

 

 

 

41

%

 

 

 

 

 

 

23

%

 

 

 

 

 

 

41

%

 

 

 

 

 

 

15

%

Overall

 

 

 

 

 

 

43

%

 

 

 

 

 

 

18

%

 

 

 

 

 

 

41

%

 

 

 

 

 

 

11

%

Available Days:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

182

 

 

 

 

 

 

 

182

 

 

 

 

 

 

 

362

 

 

 

 

 

 

 

362

 

 

 

 

 

FSV

 

 

273

 

 

 

 

 

 

 

189

 

 

 

 

 

 

 

543

 

 

 

 

 

 

 

505

 

 

 

 

 

Supply

 

 

273

 

 

 

 

 

 

 

 

 

 

 

 

 

 

543

 

 

 

 

 

 

 

 

 

 

 

 

Liftboats (1)

 

 

549

 

 

 

 

 

 

 

742

 

 

 

 

 

 

 

1,143

 

 

 

 

 

 

 

1,763

 

 

 

 

 

Overall

 

 

1,277

 

 

 

 

 

 

 

1,112

 

 

 

 

 

 

 

2,591

 

 

 

 

 

 

 

2,630

 

 

 

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

9,759

 

 

 

80

%

 

$

3,419

 

 

 

75

%

 

$

17,623

 

 

 

80

%

 

$

4,908

 

 

 

67

%

Bareboat charter

 

 

 

 

 

%

 

 

434

 

 

 

9

%

 

 

 

 

 

%

 

 

1,163

 

 

 

16

%

Other marine services

 

 

2,399

 

 

 

20

%

 

 

727

 

 

 

16

%

 

 

4,451

 

 

 

20

%

 

 

1,273

 

 

 

17

%

 

 

 

12,158

 

 

 

100

%

 

 

4,580

 

 

 

100

%

 

 

22,074

 

 

 

100

%

 

 

7,344

 

 

 

100

%

Direct operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

5,773

 

 

 

47

%

 

 

1,528

 

 

 

33

%

 

 

10,696

 

 

 

48

%

 

 

3,272

 

 

 

45

%

Repairs and maintenance

 

 

1,280

 

 

 

11

%

 

 

389

 

 

 

8

%

 

 

2,381

 

 

 

11

%

 

 

1,043

 

 

 

14

%

Drydocking

 

 

4,090

 

 

 

34

%

 

 

777

 

 

 

17

%

 

 

6,957

 

 

 

32

%

 

 

1,652

 

 

 

22

%

Insurance and loss reserves

 

 

1,198

 

 

 

10

%

 

 

923

 

 

 

20

%

 

 

1,427

 

 

 

6

%

 

 

1,450

 

 

 

20

%

Fuel, lubes and supplies

 

 

794

 

 

 

7

%

 

 

245

 

 

 

5

%

 

 

1,456

 

 

 

7

%

 

 

444

 

 

 

6

%

Other

 

 

281

 

 

 

1

%

 

 

224

 

 

 

5

%

 

 

505

 

 

 

2

%

 

 

301

 

 

 

4

%

 

 

 

13,416

 

 

 

110

%

 

 

4,086

 

 

 

89

%

 

 

23,422

 

 

 

106

%

 

 

8,162

 

 

 

111

%

Direct Vessel  (Loss) Profit

 

$

(1,258

)

 

 

(10

)%

 

$

494

 

 

 

11

%

 

$

(1,348

)

 

 

(6

)%

 

$

(818

)

 

 

(11

)%

 

 

(1)

As of June 30, 2021, the Company removed from service four liftboats in this class. Liftboat Utilization and Available Days reflects the removed from service status of these vessels.

 

Current Year Quarter compared with Prior Year Quarter

 

Operating Revenues. Charter revenues were $5.9 million higher in the Current Year Quarter compared with the Prior Year Quarter. Charter revenues were $3.0 million higher due to the acquisition of an additional three PSVs in this region as a result of the Merger of OSV Partners I, $2.6 million higher due to the repositioning of vessels between geographic regions and $0.3 million higher due to improved utilization of the core fleet. Other marine services were $1.7 million higher primarily due to business interruption insurance revenue and higher management fees and liftboat catering revenues. As of June 30, 2022, the Company had three of 14 owned and leased-in vessels (one AHTS vessels, one FSV, and one liftboat) cold-stacked in this region compared with five of ten vessels (one AHTS vessel, one FSV, and three liftboats) as of June 30, 2021. As of June 30, 2021, the Company removed from service four liftboats in this region.

 

 

36


 

Direct Operating Expenses. Direct operating expenses were $9.3 million higher in the Current Year Quarter compared with the Prior Year Quarter. Direct operating expenses were $5.8 million higher due to the repositioning of vessels between geographic regions, $1.8 million higher for the core fleet primarily due to the timing of certain drydocking and repair expenditures and $1.7 million higher due to net fleet additions. The Current Year Quarter drydocking and repair expenditures included $0.8 million of costs pending adjustment of insurance claims.

Current Year Six Months compared with Prior Year Six Months

 

Operating Revenues. Charter revenues were $11.6 million higher in the Current Year Six Months. Charter revenues were $5.9 million higher due to the repositioning of vessels between geographic regions, $4.5 million higher due to the acquisition of an additional three PSVs in this region as a result of the Merger of OSV Partners I and $1.2 million higher due to improved utilization of the core fleet. Other marine services were $3.2 million higher primarily due to business interruption insurance revenue and higher management fees and liftboat catering revenues.

 

Direct Operating Expenses. Direct operating expenses were $15.3 million higher in the Current Year Six Months compared with the Prior Year Six Months. Direct operating expenses were $8.3 million higher due to the repositioning of vessels between geographic regions, $3.6 million higher for the core fleet primarily due to the timing of certain drydocking and repair expenditures and $3.4 million higher due to net fleet additions. The Current Year Six Months drydocking and repair expenditures included $0.8 million of costs pending adjustment of insurance claims.

 

37


Africa and Europe, continuing operations. For the three and six months ended June 30, 2022 and 2021 the Company’s time charter statistics and direct vessel profit in Africa and Europe was as follows (in thousands, except statistics):

 

 

 

For the Three Months Ended June 30,

 

 

For the Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rates Per Day Worked:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

$

10,018

 

 

 

 

 

 

$

8,648

 

 

 

 

 

 

$

9,971

 

 

 

 

 

 

$

8,528

 

 

 

 

 

FSV

 

 

10,719

 

 

 

 

 

 

 

8,852

 

 

 

 

 

 

 

10,301

 

 

 

 

 

 

 

8,924

 

 

 

 

 

Supply

 

 

13,621

 

 

 

 

 

 

 

10,685

 

 

 

 

 

 

 

12,224

 

 

 

 

 

 

 

10,685

 

 

 

 

 

Liftboats

 

 

 

 

 

 

 

 

 

34,535

 

 

 

 

 

 

 

 

 

 

 

 

 

 

34,766

 

 

 

 

 

Overall

 

 

11,279

 

 

 

 

 

 

 

11,231

 

 

 

 

 

 

 

10,666

 

 

 

 

 

 

 

11,291

 

 

 

 

 

Utilization:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

 

 

 

 

98

%

 

 

 

 

 

 

98

%

 

 

 

 

 

 

99

%

 

 

 

 

 

 

99

%

FSV

 

 

 

 

 

 

86

%

 

 

 

 

 

 

71

%

 

 

 

 

 

 

82

%

 

 

 

 

 

 

70

%

Supply

 

 

 

 

 

 

72

%

 

 

 

 

 

 

42

%

 

 

 

 

 

 

75

%

 

 

 

 

 

 

21

%

Liftboats

 

 

 

 

 

 

%

 

 

 

 

 

 

100

%

 

 

 

 

 

 

%

 

 

 

 

 

 

100

%

Overall

 

 

 

 

 

 

85

%

 

 

 

 

 

 

75

%

 

 

 

 

 

 

83

%

 

 

 

 

 

 

71

%

Available Days:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

273

 

 

 

 

 

 

 

273

 

 

 

 

 

 

 

543

 

 

 

 

 

 

 

543

 

 

 

 

 

FSV

 

 

852

 

 

 

 

 

 

 

819

 

 

 

 

 

 

 

1,752

 

 

 

 

 

 

 

1,635

 

 

 

 

 

Supply

 

 

442

 

 

 

 

 

 

 

182

 

 

 

 

 

 

 

771

 

 

 

 

 

 

 

362

 

 

 

 

 

Liftboats

 

 

 

 

 

 

 

 

 

91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

181

 

 

 

 

 

Overall

 

 

1,567

 

 

 

 

 

 

 

1,365

 

 

 

 

 

 

 

3,066

 

 

 

 

 

 

 

2,721

 

 

 

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

14,930

 

 

 

93

%

 

$

11,437

 

 

 

102

%

 

$

27,210

 

 

 

98

%

 

$

21,939

 

 

 

102

%

Other marine services

 

 

1,072

 

 

 

7

%

 

 

(224

)

 

 

(2

%)

 

 

456

 

 

 

2

%

 

 

(493

)

 

 

(2

%)

 

 

 

16,002

 

 

 

100

%

 

 

11,213

 

 

 

100

%

 

 

27,666

 

 

 

100

%

 

 

21,446

 

 

 

100

%

Direct operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

3,526

 

 

 

22

%

 

 

4,253

 

 

 

38

%

 

 

7,062

 

 

 

26

%

 

 

7,473

 

 

 

35

%

Repairs and maintenance

 

 

2,638

 

 

 

16

%

 

 

2,195

 

 

 

20

%

 

 

4,217

 

 

 

15

%

 

 

3,386

 

 

 

16

%

Drydocking

 

 

134

 

 

 

1

%

 

 

374

 

 

 

3

%

 

 

1,278

 

 

 

5

%

 

 

678

 

 

 

3

%

Insurance and loss reserves

 

 

329

 

 

 

2

%

 

 

352

 

 

 

3

%

 

 

453

 

 

 

2

%

 

 

785

 

 

 

4

%

Fuel, lubes and supplies

 

 

1,490

 

 

 

9

%

 

 

887

 

 

 

8

%

 

 

2,963

 

 

 

11

%

 

 

1,459

 

 

 

7

%

Other

 

 

1,871

 

 

 

12

%

 

 

2,072

 

 

 

18

%

 

 

3,699

 

 

 

12

%

 

 

2,651

 

 

 

12

%

 

 

 

9,988

 

 

 

62

%

 

 

10,133

 

 

 

90

%

 

 

19,672

 

 

 

71

%

 

 

16,432

 

 

 

76

%

Direct Vessel Profit

 

$

6,014

 

 

 

38

%

 

$

1,080

 

 

 

10

%

 

$

7,994

 

 

 

29

%

 

$

5,014

 

 

 

24

%

 

 

Current Year Quarter compared with Prior Year Quarter

Operating Revenues.  Charter revenues were $3.5 million higher in the Current Year Quarter compared with the Prior Year Quarter. Charter revenues were $2.8 million higher due to the reactivation of vessels from cold-stacked status, $0.4 million higher due to the repositioning of vessels between geographic regions and $0.4 million higher for the core fleet as a result of increased day rates and utilization. Charter revenues were $0.1 million lower due to net asset dispositions. Other marine services were $1.3 million higher following the receipt of cash from the settlement of a mediation in our favor. As of June 30, 2022, the Company had no owned or leased-in vessels cold stacked in this region, compared with one of 13 owned and leased-in vessels (one FSV) cold-stacked in this region as of June 30, 2021.

Direct Operating Expenses.  Direct operating expenses were $0.1 million lower in the Current Year Quarter compared with the Prior Year Quarter. Direct operating expenses were $0.4 million lower due to net asset dispositions and $0.4 million lower for the core fleet primarily due to the timing of certain drydocking and repair expenditures. Direct operating expenses were $0.7 million higher due to the repositioning of vessels between geographic regions.

 

 

38


 

Current Year Six Months compared with Prior Year Six Months

Operating Revenues. Charter revenues were $5.3 million higher in the Current Year Six Months compared with the Prior Year Six Months. Charter revenues were $6.1 million higher due to the reactivation of vessels from cold-stacked status and $0.8 million lower due to the repositioning of vessels between geographic regions. Other marine services were $0.9 million higher primarily due to the receipt of cash from the settlement of a mediation in our favor.

Direct Operating Expenses. Direct operating expenses were $3.2 million higher in the Current Year Six Months compared with the Prior Year Six Months. Direct operating expenses were $2.8 million higher due to the repositioning of vessels between geographic regions and $1.3 million higher due to the reactivation of vessels from cold-stacked status. Direct operating expenses were $0.6 million lower for the core fleet and $0.3 million lower due to net asset dispositions.

Middle East and Asia. For the three and six months ended June 30, 2022 and 2021 the Company’s time charter statistics and direct vessel profit in the Middle East and Asia was as follows (in thousands, except statistics):

 

 

 

 

For the Three Months Ended June 30,

 

 

For the Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rates Per Day Worked:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

$

5,557

 

 

 

 

 

 

$

5,619

 

 

 

 

 

 

$

5,669

 

 

 

 

 

 

$

5,834

 

 

 

 

 

FSV

 

 

7,685

 

 

 

 

 

 

 

7,354

 

 

 

 

 

 

 

7,532

 

 

 

 

 

 

 

7,188

 

 

 

 

 

Supply

 

 

9,870

 

 

 

 

 

 

 

7,694

 

 

 

 

 

 

 

9,173

 

 

 

 

 

 

 

7,881

 

 

 

 

 

Liftboats

 

 

29,000

 

 

 

 

 

 

 

25,213

 

 

 

 

 

 

 

29,000

 

 

 

 

 

 

 

25,213

 

 

 

 

 

Specialty (1)

 

 

 

 

 

 

 

 

 

1,571

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,736

 

 

 

 

 

Overall

 

 

9,673

 

 

 

 

 

 

 

9,292

 

 

 

 

 

 

 

9,775

 

 

 

 

 

 

 

9,300

 

 

 

 

 

Utilization:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

 

 

 

 

100

%

 

 

 

 

 

 

25

%

 

 

 

 

 

 

99

%

 

 

 

 

 

 

62

%

FSV

 

 

 

 

 

 

91

%

 

 

 

 

 

 

86

%

 

 

 

 

 

 

93

%

 

 

 

 

 

 

77

%

Supply

 

 

 

 

 

 

91

%

 

 

 

 

 

 

75

%

 

 

 

 

 

 

75

%

 

 

 

 

 

 

70

%

Liftboats

 

 

 

 

 

 

50

%

 

 

 

 

 

 

100

%

 

 

 

 

 

 

67

%

 

 

 

 

 

 

100

%

Specialty (1)

 

 

 

 

 

 

%

 

 

 

 

 

 

92

%

 

 

 

 

 

 

%

 

 

 

 

 

 

96

%

Overall

 

 

 

 

 

 

87

%

 

 

 

 

 

 

81

%

 

 

 

 

 

 

82

%

 

 

 

 

 

 

77

%

Available Days:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AHTS

 

 

91

 

 

 

 

 

 

 

91

 

 

 

 

 

 

 

181

 

 

 

 

 

 

 

181

 

 

 

 

 

FSV

 

 

819

 

 

 

 

 

 

 

910

 

 

 

 

 

 

 

1,629

 

 

 

 

 

 

 

1,804

 

 

 

 

 

Supply

 

 

559

 

 

 

 

 

 

 

546

 

 

 

 

 

 

 

1,189

 

 

 

 

 

 

 

1,145

 

 

 

 

 

Liftboats

 

 

182

 

 

 

 

 

 

 

182

 

 

 

 

 

 

 

362

 

 

 

 

 

 

 

362

 

 

 

 

 

Specialty (1)

 

 

 

 

 

 

 

 

 

91

 

 

 

 

 

 

 

90

 

 

 

 

 

 

 

181

 

 

 

 

 

Overall

 

 

1,651

 

 

 

 

 

 

 

1,820

 

 

 

 

 

 

 

3,451

 

 

 

 

 

 

 

3,672

 

 

 

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

13,906

 

 

 

97

%

 

$

13,752

 

 

 

100

%

 

$

27,566

 

 

 

98

%

 

$

26,327

 

 

 

99

%

Other marine services

 

 

460

 

 

 

3

%

 

 

31

 

 

 

0

%

 

 

509

 

 

 

2

%

 

 

391

 

 

 

1

%

 

 

 

14,366

 

 

 

100

%

 

 

13,783

 

 

 

100

%

 

 

28,075

 

 

 

100

%

 

 

26,718

 

 

 

100

%

Direct operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

5,691

 

 

 

40

%

 

 

5,378

 

 

 

39

%

 

 

11,722

 

 

 

42

%

 

 

10,586

 

 

 

40

%

Repairs and maintenance

 

 

2,545

 

 

 

18

%

 

 

2,806

 

 

 

20

%

 

 

4,377

 

 

 

16

%

 

 

3,709

 

 

 

14

%

Drydocking

 

 

2,250

 

 

 

16

%

 

 

1,185

 

 

 

9

%

 

 

3,212

 

 

 

11

%

 

 

2,251

 

 

 

8

%

Insurance and loss reserves

 

 

748

 

 

 

5

%

 

 

461

 

 

 

3

%

 

 

1,255

 

 

 

5

%

 

 

1,163

 

 

 

4

%

Fuel, lubes and supplies

 

 

1,318

 

 

 

9

%

 

 

1,081

 

 

 

8

%

 

 

2,328

 

 

 

8

%

 

 

1,640

 

 

 

6

%

Other

 

 

1,213

 

 

 

8

%

 

 

43

 

 

 

0

%

 

 

2,840

 

 

 

10

%

 

 

1,187

 

 

 

4

%

 

 

 

13,765

 

 

 

96

%

 

 

10,954

 

 

 

79

%

 

 

25,734

 

 

 

92

%

 

 

20,536

 

 

 

77

%

Direct Vessel Profit

 

$

601

 

 

 

4

%

 

$

2,829

 

 

 

21

%

 

$

2,341

 

 

 

8

%

 

$

6,182

 

 

 

23

%

 

 

(2)

In the second quarter of 2022, the Company removed from service one specialty vessel in this region. Specialty statistics reflect the removed from service status of this vessel.

 

 

39


 

Current Year Quarter compared with Prior Year Quarter

Operating Revenues. Charter revenues were $0.2 million higher in the Current Year Quarter compared with the Prior Year Quarter. Charter revenues were $1.5 million higher due to the acquisition of an additional two PSVs in this region as a result of the Merger of OSV Partners I. Charter revenues were $1.2 million lower due to the repositioning of vessels between geographic regions and $0.1 million lower for the core fleet. As of June 30, 2022, the Company had no owned or leased-in vessels cold-stacked in this region compared with two of 20 owned and leased-in vessels (one FSV and one Supply) as of June 30, 2021. In the second quarter of 2022, the Company removed from service one specialty vessel in this region.

Direct Operating Expenses. Direct operating expenses were $2.8 million higher in the Current Year Quarter compared with the Prior Year Quarter. Direct operating expenses were $1.9 million higher for the core fleet primarily due to the timing of certain drydocking and repair expenditures and $1.2 million higher due to net fleet additions. Direct operating expenses were $0.3 million lower due to the repositioning of vessels between geographic regions. The Current Year Quarter drydocking and repair expenditures included $1.2 million of costs pending adjustment of insurance claims.

Current Year Six Months compared with Prior Year Six Months

Operating Revenues. Charter revenues were $1.2 million higher in the Current Year Six Months compared with the Prior Year Six Months. Charter revenues were $1.9 million higher due to the acquisition of an additional two PSVs in this region as a result of the Merger of OSV Partners I and $1.0 million higher for the core fleet. Charter revenues were $1.7 million lower due to the repositioning of vessels between geographic regions.

Direct Operating Expenses. Direct operating expenses were $5.2 million higher in the Current Year Six Months compared with the Prior Year Six Months. Direct operating expenses were $3.8 million higher for the core fleet primarily due to the timing of certain drydocking and repair expenditures and $2.7 million higher due to net fleet additions. Direct operating expenses were $1.3 million lower due to the repositioning of vessels between geographic regions. The Current Year Six Months drydocking and repair expenditures included $1.2 million of costs pending adjustment of insurance claims.

 

40


Latin America (Brazil, Mexico, Central and South America). For the three and six months ended June 30, 2022 and 2021 the Company’s time charter statistics and direct vessel profit in Latin America was as follows (in thousands, except statistics):

 

 

 

For the Three Months Ended June 30,

 

 

For the Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Time Charter Statistics:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rates Per Day Worked:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FSV

 

$

7,961

 

 

 

 

 

 

$

7,603

 

 

 

 

 

 

$

7,877

 

 

 

 

 

 

$

7,587

 

 

 

 

 

Supply

 

 

15,531

 

 

 

 

 

 

 

15,334

 

 

 

 

 

 

 

15,385

 

 

 

 

 

 

 

15,455

 

 

 

 

 

Liftboats

 

 

25,175

 

 

 

 

 

 

 

37,756

 

 

 

 

 

 

 

25,835

 

 

 

 

 

 

 

38,817

 

 

 

 

 

Overall

 

 

14,263

 

 

 

 

 

 

 

17,034

 

 

 

 

 

 

 

13,885

 

 

 

 

 

 

 

15,970

 

 

 

 

 

Utilization:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FSV

 

 

 

 

 

 

100

%

 

 

 

 

 

 

67

%

 

 

 

 

 

 

96

%

 

 

 

 

 

 

83

%

Supply

 

 

 

 

 

 

99

%

 

 

 

 

 

 

98

%

 

 

 

 

 

 

93

%

 

 

 

 

 

 

90

%

Liftboats

 

 

 

 

 

 

48

%

 

 

 

 

 

 

65

%

 

 

 

 

 

 

37

%

 

 

 

 

 

 

63

%

Overall

 

 

 

 

 

 

94

%

 

 

 

 

 

 

86

%

 

 

 

 

 

 

89

%

 

 

 

 

 

 

85

%

Available Days:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FSV

 

 

182

 

 

 

 

 

 

 

182

 

 

 

 

 

 

 

362

 

 

 

 

 

 

 

362

 

 

 

 

 

Supply

 

 

546

 

 

 

 

 

 

 

546

 

 

 

 

 

 

 

1,117

 

 

 

 

 

 

 

1,086

 

 

 

 

 

Liftboats

 

 

88

 

 

 

 

 

 

 

152

 

 

 

 

 

 

 

124

 

 

 

 

 

 

 

211

 

 

 

 

 

Overall

 

 

816

 

 

 

 

 

 

 

880

 

 

 

 

 

 

 

1,603

 

 

 

 

 

 

 

1,659

 

 

 

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time charter

 

$

10,909

 

 

 

95

%

 

$

12,866

 

 

 

97

%

 

$

19,846

 

 

 

91

%

 

$

22,590

 

 

 

95

%

Bareboat charter

 

 

48

 

 

 

0

%

 

 

 

 

 

%

 

 

666

 

 

 

3

%

 

 

 

 

 

%

Other marine services

 

 

534

 

 

 

5

%

 

 

357

 

 

 

3

%

 

 

1,281

 

 

 

6

%

 

 

1,213

 

 

 

5

%

 

 

 

11,491

 

 

 

100

%

 

 

13,223

 

 

 

100

%

 

 

21,793

 

 

 

100

%

 

 

23,803

 

 

 

100

%

Direct operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Personnel

 

 

3,356

 

 

 

29

%

 

 

3,194

 

 

 

24

%

 

 

7,301

 

 

 

34

%

 

 

6,440

 

 

 

27

%

Repairs and maintenance

 

 

1,917

 

 

 

17

%

 

 

1,569

 

 

 

12

%

 

 

4,196

 

 

 

19

%

 

 

2,661

 

 

 

11

%

Drydocking

 

 

 

 

 

%

 

 

456

 

 

 

3

%

 

 

 

 

 

%

 

 

428

 

 

 

2

%

Insurance and loss reserves

 

 

270

 

 

 

2

%

 

 

925

 

 

 

7

%

 

 

596

 

 

 

3

%

 

 

1,221

 

 

 

5

%

Fuel, lubes and supplies

 

 

748

 

 

 

7

%

 

 

680

 

 

 

5

%

 

 

1,332

 

 

 

6

%

 

 

1,552

 

 

 

7

%

Other

 

 

685

 

 

 

6

%

 

 

618

 

 

 

5

%

 

 

1,388

 

 

 

6

%

 

 

1,490

 

 

 

6

%

 

 

 

6,976

 

 

 

61

%

 

 

7,442

 

 

 

56

%

 

 

14,813

 

 

 

68

%

 

 

13,792

 

 

 

58

%

Direct Vessel Profit

 

$

4,515

 

 

 

39

%

 

$

5,781

 

 

 

44

%

 

$

6,980

 

 

 

32

%

 

$

10,011

 

 

 

42

%

 

 

Current Year Quarter compared with Prior Year Quarter

Operating Revenues. Charter revenues were $1.9 million lower in the Current Year Quarter compared with the Prior Year Quarter. Charter revenues were $2.9 million lower due to the repositioning of vessels between geographic regions and $1.0 million higher for the core fleet. As of June 30, 2022, the Company had no owned or leased-in vessels cold-stacked in this region.

Direct Operating Expenses. Direct operating expenses were $0.5 million lower in the Current Year Quarter compared with the Prior Year Quarter primarily due to the repositioning of vessels between geographic regions.

Current Year Six Months compared with Prior Year Six Months

Operating Revenues. Charter revenues were $2.1 million lower in the Current Year Six Months compared with the Prior Year Six Months. Charter revenues were $3.7 million lower due to the repositioning of vessels between geographic regions and $1.6 million higher for the core fleet.

Direct Operating Expenses. Direct operating expenses were $1.0 million higher in the Current Year Six Months compared with the Prior Year Six Months. Direct operating expenses were $2.2 million higher for the core fleet and $1.2 million lower primarily due to the repositioning of vessels between geographic regions.

 

41


Other Operating Expenses

Lease Expense. Leased-in equipment expense for the Current Year Quarter and Current Year Six Months was essentially flat compared with the Prior Year Quarter and Prior Year Six Months.

Administrative and general. Administrative and general expenses for the Current Year Quarter and Current Year Six Months were $1.1 million higher and $2.4 million higher compared to the Prior Year Quarter and Prior Year Six Months, respectively, due to increases in salaries and benefits expenses in the Current Year Quarter and Current Year Six Months.

Depreciation and amortization. Depreciation and amortization expense for the Current Year Quarter and Current Year Six Months were $0.1 million higher and $0.3 million lower compared to the Prior Year Quarter and Prior Year Six Months, respectively, primarily due to net fleet changes.

 

Gains (Losses) on Asset Dispositions and Impairments, Net. During the Current Year Quarter, the Company sold one FSV and other equipment for net cash proceeds of $1.4 million, after transaction costs. The Company classified the FSV as held for sale and recorded impairment charges of $0.9 million during the first quarter of 2022. During the Prior Year Quarter, the Company sold one FSV and set off debt payments with hull and machinery insurance proceeds for the liftboat SEACOR Power of $25.0 million, for a total of $28.6 million in cash, resulting in gains of $23.3 million.

 

During the Current Year Six Months, the Company sold one FSV, one liftboat, which was previously removed from service, office space and other equipment for net cash proceeds of $6.7 million, after transaction costs, and a gain of $2.2 million, which included impairment charges of $0.9 million for the FSV classified as held for sale during the first quarter of 2022 and sold during the second quarter of 2022. During the Prior Year Six Months, the Company sold one PSV vessel, three FSVs and set off debt payments with hull and machinery insurance proceeds for the liftboat SEACOR Power of $25.0 million, for a total of $30.1 million in cash, resulting in gains of $20.9 million.

 

Other Income (Expense), Net

For the periods ended June 30, the Company’s other income (expense) was as follows (in thousands):

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Other Income (Expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

190

 

 

$

135

 

 

$

219

 

 

$

1,121

 

Interest expense

 

 

(6,989

)

 

 

(7,310

)

 

 

(13,616

)

 

 

(15,328

)

SEACOR Holdings guarantee fees

 

 

 

 

 

 

 

 

 

 

 

(7

)

Gain on debt extinguishment

 

 

 

 

 

61,994

 

 

 

 

 

 

61,994

 

Derivative gains (losses), net

 

 

33

 

 

 

30

 

 

 

(1

)

 

 

385

 

Foreign currency gains (losses), net

 

 

1,170

 

 

 

(657

)

 

 

1,991

 

 

 

(1,123

)

Other, net

 

 

(41

)

 

 

(1

)

 

 

(41

)

 

 

(1

)

 

 

$

(5,637

)

 

$

54,191

 

 

$

(11,448

)

 

$

47,041

 

 

Interest income. Interest income for the Current Year Quarter compared with the Prior Year Quarter was essentially flat. Interest income for the Current Year Six Months compared with the Prior Year Six Months decreased primarily due to interest received from the IRS due to delays in the payment of the CARES Act tax refunds in the Prior Year Six Months.

 

Interest expense. Interest expense was lower in the Current Year Quarter and Current Year Six Months compared with the Prior Year Quarter and Prior Year Six Months primarily due to the extinguishment of $117.3 million of principal outstanding under the FGUSA Credit Facility. This decrease was offset by increases in interest associated with the Tarahumara Shipyard Financing following delivery of one PSV in 2021 and the debt assumed as a result of the Merger of OSV Partners I.

 

42


Derivative (losses) gains, net. Net derivative (losses) gains for the Current Year Quarter compared with the Prior Year Quarter was essentially flat. Net derivative (losses) gains for the Current Year Six Months compared to the Prior Year Six Months decreased due to the Company not having any open forward currency exchange contracts since March 31, 2021.

Foreign currency gains (losses), net. Foreign currency gains for the Current Year Quarter and Current Year Six Months compared to foreign currency losses for the Prior Year Quarter and Prior Year Six Months was primarily due to various changes in foreign currencies.

Income Tax Benefit

During the six months ended June 30, 2022, the Company’s effective income tax rate of 9.20% was primarily due to foreign taxes not creditable against U.S. income taxes and foreign losses for which there is no benefit in the U.S.

Equity in Earnings of 50% or Less Owned Companies

Equity in earnings of 50% or less owned companies for the Current Year Quarter compared with the Prior Year Quarter were $1.8 million lower and earnings for the Current Year Six Months compared with the Prior Year Six Months were essentially flat due to the following changes in equity earnings gains (losses) (in thousands):

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

MexMar

 

$

(411

)

 

$

603

 

 

$

3,822

 

 

$

4,622

 

MEXMAR Offshore

 

 

 

 

 

2,562

 

 

$

 

 

 

2,562

 

SEACOR Arabia

 

 

(160

)

 

 

(1,093

)

 

 

351

 

 

 

(823

)

OSV Partners

 

 

 

 

 

(428

)

 

 

 

 

 

(1,029

)

Offshore Vessel Holdings

 

 

1,027

 

 

 

517

 

 

 

1,642

 

 

 

768

 

Other

 

 

(41

)

 

 

6

 

 

 

274

 

 

 

170

 

 

 

$

415

 

 

$

2,167

 

 

$

6,089

 

 

$

6,270

 

OSV Partners. On December 31, 2021, SEACOR Marine, SEACOR Offshore OSV and OSV Partners I entered into the Merger Agreement pursuant to which OSV Partners I merged with and into SEACOR Offshore OSV, with SEACOR Offshore OSV surviving the merger. As a result of the Merger, the five 201’, 1,900 tons deadweight capacity, PSVs owned by OSV Partners I are now 100% owned by the Company and no longer included as equity in earnings.

MEXMAR Offshore. On December 9, 2021, the Company transferred its 49% interest in MEXMAR Offshore International LLC (“MEXMAR Offshore”) to a subsidiary of CME for nominal consideration and a transaction fee of $0.2 million. As of December 31, 2021, the Company does not have any ownership interest in MEXMAR Offshore.

 

Liquidity and Capital Resources

General

The Company’s ongoing liquidity requirements arise primarily from working capital needs, capital commitments and its obligations to service outstanding debt and comply with covenants under its debt facilities. The Company may use its liquidity to fund capital expenditures, make acquisitions or to make other investments. Sources of liquidity are cash balances, construction reserve funds and cash flows from operations. From time to time, the Company may secure additional liquidity through asset sales or the issuance of debt, shares of Common Stock or common stock of its subsidiaries, preferred stock or a combination thereof.

As of June 30, 2022, the Company had unfunded capital commitments of $1.1 million for miscellaneous vessel equipment, $0.3 million of which is payable during the remainder of 2022 and $0.8 million of which is

 

43


payable during 2023. The Company has indefinitely deferred an additional $9.4 million of orders with respect to one FSV that the Company had previously reported as unfunded capital commitments.

As of June 30, 2022, the Company had outstanding debt of $352.1 million, net of debt discount and issue costs. The Company’s contractual long-term debt maturities as of June 30, 2022, are as follows (in thousands):

 

 

 

Actual

 

Remainder 2022

 

$

15,218

 

2023

 

 

241,517

 

2024

 

 

55,334

 

2025

 

 

12,629

 

2026

 

 

11,365

 

Years subsequent to 2026

 

 

48,779

 

 

 

$

384,842

 

 

As of June 30, 2022, the Company held balances of cash, cash equivalents, restricted cash and construction reserve funds totaling $25.9 million. As of June 30, 2021, the Company held balances of cash, cash equivalents, restricted cash and construction reserve funds totaling $51.3 million, of which $2.7 million was construction reserve funds held as cash. Additionally, the Company had $1.1 million available borrowing capacity under subsidiary credit facilities as of June 30, 2022, compared to $0.7 million as of June 30, 2021.

Summary of Cash Flows

The following is a summary of the Company’s cash flows (in thousands) for the six months ended for the following years:

 

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

Cash flows provided by or (used in):

 

 

 

 

 

 

 

 

Operating Activities

 

$

(5,845

)

 

$

9,539

 

Investing Activities

 

 

6,995

 

 

 

68,262

 

Financing Activities

 

 

(16,462

)

 

 

(65,846

)

Effects of Exchange Rate Changes on Cash, Restricted Cash and Cash Equivalents

 

 

(4

)

 

 

(21

)

Net Decrease in Cash, Restricted Cash and Cash Equivalents from Discontinued Operations

 

 

 

 

 

(171

)

Net (Decrease) Increase in Cash, Restricted Cash and Cash Equivalents

 

$

(15,316

)

 

$

11,763

 

 

44


 

Operating Activities

Cash flows provided by continuing operating activities decreased by $15.5 million in the Current Year Six Months compared with the Prior Year Six Months primarily due to income tax refunds received in 2021 partially offset by working capital timing. The components of cash flows provided by and/or used in continuing operating activities during the Current Year Six Months and Prior Year Six Months were as follows:

 

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

DVP:

 

 

 

 

 

 

 

 

United States, primarily Gulf of Mexico

 

$

(1,348

)

 

$

(818

)

Africa and Europe, Continuing Operations

 

 

7,994

 

 

 

5,014

 

Middle East and Asia

 

 

2,341

 

 

 

6,182

 

Latin America

 

 

6,980

 

 

 

10,011

 

Operating, leased-in equipment

 

 

(1,098

)

 

 

(4,599

)

Administrative and general (excluding provisions for bad debts and amortization of share awards)

 

 

(17,464

)

 

 

(15,142

)

SEACOR Holdings management and guarantee fees

 

 

 

 

 

(7

)

Other, net (excluding non-cash losses)

 

 

(41

)

 

 

168

 

Dividends received from 50% or less owned companies

 

 

1,887

 

 

 

 

 

 

 

(749

)

 

 

809

 

Changes in operating assets and liabilities before interest and income taxes

 

 

5,522

 

 

 

(10,876

)

Restricted stock vested

 

 

(732

)

 

 

(272

)

Director share awards

 

 

 

 

 

435

 

Cash settlements on derivative transactions, net

 

 

(651

)

 

 

(1,333

)

Interest paid, excluding capitalized interest (1)

 

 

(10,341

)

 

 

(11,745

)

Interest received

 

 

219

 

 

 

1,121

 

Income taxes refunded, net

 

 

887

 

 

 

31,400

 

Total cash flows (used in) provided by operating activities

 

$

(5,845

)

 

$

9,539

 

 

(1)

During the Current Year Six Months, the Company paid no capitalized interest. During the Prior Year Six Months, capitalized interest paid and included in purchases of property and equipment for continuing operations was $0.3 million.

For a detailed discussion of the Company’s financial results for the reported periods, see “Consolidated Results of Operations” included above. Changes in operating assets and liabilities before interest and income taxes are the result of the Company’s working capital requirements.

Investing Activities

During the Current Year Six Months, net cash provided by investing activities was $7.0 million, primarily as a result of the following:

 

capital expenditures were less than $0.1 million;

 

the Company sold one FSV, one liftboat, which was previously removed from service, office space and other equipment for net cash proceeds of $6.7 million, after transaction costs, and a gain of $2.2 million; and

 

the Company received $0.4 million from investments in, and advances to, its 50% or less owned companies for principal payments on notes.

During the Prior Year Six Months, net cash provided by investing activities was $68.3 million, primarily as a result of the following:

 

capital expenditures were $3.7 million;

 

the Company sold three FSVs, one PSV and reduced debt payments with hull and machinery insurance proceeds from the SEACOR Power of $25.0 million, for a total of $30.1 million;

 

the Company completed the sale of Windcat Workboats for net proceeds of $38.7 million ($42.2 million cash, less $3.5 million cash held at Windcat Workboats that was included in the assets purchased by the Windcat Buyer);

 

45


 

the Company made investments in, and advances to, its 50% or less owned companies of $0.7 million; and

 

the Company received $3.8 million from investments in, and advances to, its 50% or less owned companies for principal payments on notes.

Financing Activities

During the Current Year Six Months, net cash used in financing activities was $16.5 million, primarily as a result of the following:

 

the Company made scheduled payments on long-term debt and other obligations of $16.5 million;

 

the Company received $0.2 million proceeds from the exercise of stock options; and

 

the Company made payments on finance leases of $0.1 million.

During the Prior Year Six Months, net cash used in financing activities was $65.8 million; primarily as a result of the following:

 

the Company made scheduled payments on long-term debt and obligations of $65.1 million; and

 

 

the Company made payments on debt extinguishment costs of $0.8 million.

 

Short and Long-Term Liquidity Requirements

The Company believes that a combination of cash balances on hand, construction reserve funds, cash generated from operating activities, availability under existing subsidiary financing arrangements and access to the credit and capital markets will provide sufficient liquidity to meet its obligations, including to support its capital expenditures program, working capital needs, debt service requirements and covenant compliance over the short to medium term. The Company continually evaluates possible acquisitions and dispositions of certain businesses and assets. The Company’s sources of liquidity may be impacted by the general condition of the markets in which it operates and the broader economy as a whole, which may limit its access to the credit and capital markets on acceptable terms. Management continuously monitors the Company’s liquidity to ensure it is sufficient to meet its needs as well as to ensure compliance with covenants in its credit facilities.

While the COVID-19 pandemic initially reduced the demand for the Company’s products and services, the COVID-19 pandemic has not had a material impact on the Company’s liquidity or on the Company’s ability to meet its financial maintenance covenants in its various credit facilities. However, if the COVID-19 pandemic does not fully abate, new vaccine resistant strains appear, or certain countries implement new shutdowns, the effects of the pandemic on the Company's business may become more severe, for example by further reducing demand for the Company’s products and services or causing customers not to make their payments on time, and this may have a material impact on the Company.

Debt Securities and Credit Agreements

For a discussion of the Company’s debt securities and credit agreements, see “Note 4. Long-Term Debt” in the unaudited consolidated financial statements included in Part I. Item 1. “Financial Statements” elsewhere in this Quarterly Report on Form 10-Q and in “Note 8. Long-Term Debt” in the Company’s audited consolidated financial statements included in its 2021 Annual Report. Other then as set forth below there has not been any material changes to the agreement’s governing the Company’s long-term debt during the period.

On June 15, 2022, SEACOR Marine, SMFH, and certain vessel-owning subsidiaries of SEACOR Marine, entered into SMFH Amendment No. 4 to that certain SMFH Credit Facility and, in connection therewith, SEACOR Marine entered into the A&R SMFH Guaranty. SMFH Amendment No. 4 and the A&R SMFH Guaranty provide for, among other things, the amendment of the definition of Cash and Cash Equivalents to include 35% of the accounts receivable as reported in SEACOR Marine’s financial statements for the second, third and fourth quarter of fiscal year 2022.

 

46


The SMFH Credit Facility requires the Company to maintain a minimum balance of Cash and Cash Equivalents equal to the greater of (i) $35.0 million and (ii) 7.5% of Total Debt. As of June 30, 2022, the Company's Cash and Cash Equivalents balance used to test compliance with this covenant was $45.3 million or 15.0% of Total Debt. The Company expects that cash flow from operations, together with accounts receivable balances of the Company for the second, third and fourth quarter of fiscal year 2022, will be sufficient to maintain compliance with this covenant for the foreseeable future. However, if significant events such as the COVID-19 pandemic or the Russia/Ukraine conflict result in a decrease in demand for the Company’s services, it may require us to seek further amendments to this covenant.

On August 2, 2022, SEACOR Marine, SEACOR Offshore Eight LLC, a wholly-owned subsidiary of SEACOR Marine, and certain vessel owning wholly-owned subsidiaries of SEACOR Marine, entered into the 2022 88/888 Amendment to the SEACOR 88/888 Term Loan. The SEACOR 88/888 Term Loan is secured by two vessels and SEACOR Marine has provided a limited guaranty of such loan under which claims recoverable from SEACOR Marine shall not exceed the lesser of (x) $5.5 million and (y) 50% of the obligations outstanding at the time a claim is made thereunder. The 2022 88/888 Amendment provides for, among other things, (i) the extension of the maturity date of the SEACOR 88/888 Term Loan from June 29, 2023 to July 1, 2024, and (ii) the amendment of the applicable interest rate margin over SOFR from 3.75% to 4.75%.

Future Cash Requirements

For a discussion of the Company’s future cash requirements, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources” in the Company’s 2021 Annual Report. There has been no material change in the Company’s future cash requirements.

Contingencies

For a discussion of the Company’s contingencies, see “Note 9. Commitments and Contingencies” in the unaudited consolidated financial statements included in Part I. Item 1. “Financial Statements” elsewhere in this Quarterly Report on Form 10-Q.

 

47


ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a discussion of the Company’s exposure to market risk, refer to “Quantitative and Qualitative Disclosures About Market Risk” included in the Company’s 2021 Annual Report. There has been no material change in the Company’s exposure to market risk during the six months ended June 30, 2022.

ITEM 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

With the participation of the Company’s principal executive officer and principal financial officer, management evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of June 30, 2022. Based on their evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures were effective as of June 30, 2022 to provide reasonable assurance that information required to be disclosed by the Company in reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and (ii) accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

The Company’s disclosure controls and procedures have been designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, to allow timely decisions regarding required disclosures. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those internal control systems determined to be effective can provide only a level of reasonable assurance with respect to financial statement preparation and presentation.

Changes in Internal Control Over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the Current Year Quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

 

48


 

PART II—OTHER INFORMATION

ITEM 1.

For a description of developments with respect to pending legal proceedings described in the Company’s 2021 Annual Report, see “Note 9. Commitments and Contingencies” included in Part I. Item 1. “Financial Statements” elsewhere in this Quarterly Report on Form 10-Q.

ITEM 1A.

RISK FACTORS

For a discussion of the Company’s risk factors, refer to “Risk Factors” included in the Company’s 2021 Annual Report. There have been no material changes in the Company’s risk factors during the Current Year Quarter.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(a), (b) None.

 

 

(c)

This table provides information with respect to purchases by the Company of shares of its Common Stock during the Current Year Quarter:

 

 

 

Total Number of

Shares Withheld

 

 

Average Price per

Share

 

 

Total Number of

Shares Purchased

as Part of a Publicly

Announced Plan

 

 

Maximum Number

of Shares that may

be Purchased Under

the Plan

 

April 1, 2022 to April 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

May 1, 2022 to May 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

June 1, 2022 to June 30, 2022

 

 

6,500

 

 

 

9.18

 

 

 

 

 

 

 

 

For the three months ended June 30, 2022, the Company acquired for treasury 6,500 shares of Common Stock for an aggregate purchase price of $59,670 from its directors and/or employees to cover their tax withholding obligations upon the lapsing of restrictions on share awards. These shares were purchased in accordance with the terms of the Company’s 2017 Equity Incentive Plan or 2020 Equity Incentive Plan, as applicable.

 

ITEM 3.DEFAULT UPON SENIOR SECURITIES

None.

ITEM 4.

MINE SAFETY DISCLOSURES

Not applicable.

 

ITEM 5.

OTHER INFORMATION

 

None.

 

 

 

49


 

ITEM 6.

EXHIBITS

 

 

 

 

10.1*

 

Amendment No. 4 to Credit Agreement and Parent Guaranty, dated as of June 15, 2022, by and among SEACOR Marine Foreign Holdings Inc., SEACOR Marine Holdings Inc., DNB Bank ASA, New York Branch, DNB Capital LLC, Clifford Capital Pte. Ltd., Hancock Whitney Bank, Citicorp North America, Inc., and the entities identified on schedules thereto (incorporated herein by reference to Exhibit 10.1 of SEACOR Marine Holdings Inc.’s Period Filing on Form 8-K filed with the Commission on June 17, 2022 (SEC File No. 001-37966)).

 

 

 

10.2*

 

Amended and Restated Guaranty, dated as of June 15, 2022, by SEACOR Marine Holdings Inc. in favor of DNB Bank ASA, New York Branch, as security trustee (incorporated herein by reference to Exhibit 10.2 of SEACOR Marine Holdings Inc.’s Period Filing on Form 8-K filed with the Commission on June 17, 2022 (SEC File No. 001-37966)).

 

 

 

10.3*+

 

SEACOR Marine Holdings Inc. 2022 Equity Incentive Plan (incorporated herein by reference to Annex A of SEACOR Marine Holdings Inc.’s definitive proxy statement on Schedule 14A as file with the Commission on April 22, 2022 (SEC File No. 001-37966)).

 

 

 

10.4+

 

Form of Director Restricted Stock Grant Agreement under the SEACOR Marine Holdings Inc. 2022 Equity Incentive Plan.

 

 

 

31.1

 

Certification by the Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended.

 

 

 

31.2

 

Certification by the Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended.

 

 

 

32

 

Certification by the Principal Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

 

 

101.INS**

 

Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

 

 

 

101.SCH**

 

Inline XBRL Taxonomy Extension Schema

 

 

 

101.CAL**

 

Inline XBRL Taxonomy Extension Calculation Linkbase

 

 

 

101.DEF**

 

Inline XBRL Taxonomy Extension Definition Linkbase

 

 

 

101.LAB**

 

Inline XBRL Taxonomy Extension Label Linkbase

 

 

 

101.PRE**

 

Inline XBRL Taxonomy Extension Presentation Linkbase

 

 

 

104

 

The cover page for the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, has been formatted in Inline XBRL.

 

 

 

 

*

Incorporated by reference.

+

Management contract or compensatory plan or arrangement.

**

Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.

 

50


SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

 

 

 

SEACOR Marine Holdings Inc. (Registrant)

 

 

 

 

 

 

Date:

 

August 3, 2022

By:

 

/s/ John Gellert

 

 

 

 

 

John Gellert, President,

Chief Executive Officer

(Principal Executive Officer)

 

 

 

 

 

 

Date:

 

August 3, 2022

By:

 

/s/ Jesús Llorca

 

 

 

 

 

Jesús Llorca, Executive Vice President

and Chief Financial Officer

(Principal Financial Officer)

 

Date:

 

August 3, 2022

By:

 

/s/ Gregory S. Rossmiller

 

 

 

 

 

Gregory S. Rossmiller,

Senior Vice President

and Chief Accounting Officer

(Principal Accounting Officer)

 

 

 

 

51