Civeo Corp

Previous wording

We provide hospitality services to remote workforces in Australia and Canada, including catering and food service, lodging, housekeeping and maintenance at accommodation facilities that we or our customers own. We provide services that support the day-to-day operations of these facilities, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics. We also manage development activities for workforce accommodation facilities, including site selection, permitting, engineering and design and manufacturing and site construction management, along with providing hospitality services once the facility is constructed. We primarily operate in some of the world’s most active met coal, oil, liquefied natural gas (LNG) and iron ore producing regions, and our customers include mining companies, major and independent oil companies, engineering companies and mining service companies. We operate in two principal reportable business segments – Australia and Canada.

Current wording

We provide hospitality services to remote workforces in Australia and Canada, including catering and food service, lodging, housekeeping and maintenance at accommodation facilities that we or our customers own. We also provide services that support the day-to-day operations of these facilities, such as laundry, facility management and maintenance, water and wastewater treatment, power generation, communication systems, security and logistics. We also manage development activities for workforce accommodation facilities, including site selection, permitting, engineering and design and manufacturing and site construction management, along with providing hospitality services once the facility is constructed. We primarily operate in some of the world’s most active metallurgical (met) coal, oil, iron ore and liquefied natural gas (LNG) producing regions, and our customers include mining companies, major and independent oil companies, construction, engineering companies and oilfield and mining service companies. We operate in two principal reportable business segments – Australia and Canada.

Previous wording

Demand for our hospitality services is driven primarily by ongoing operations of existing natural resource projects in Australia and Canada. Historically, initial demand for our hospitality services has been driven by our customers’ capital spending programs related to the construction and development of natural resource projects and associated infrastructure. Long-term demand for our services has been driven by natural resource production, maintenance, operation and expansion of those facilities. In general, industry capital spending programs are based on the outlook for commodity prices, production costs, economic growth, perceived political risk, global commodity supply/demand, reserve replacement requirements, estimates of resource production, annual maintenance requirements and the expectations of our customers' shareholders. As a result, demand for our hospitality services is sensitive to expected commodity prices, principally related to met coal, oil, iron ore and LNG, and the resultant impact of these commodity price expectations on our customers’ spending. Other factors that can affect our business and financial results include the general global economic environment, including inflationary pressures, supply chain disruptions and labor shortages, volatility affecting the banking system and financial markets, availability of capital to the natural resource industry and regulatory changes in Canada, Australia and other markets, including governmental measures introduced to mitigate climate change.

Current wording

Demand for the majority of our hospitality services is driven primarily by ongoing operations of existing natural resource projects in Australia and Canada. Historically, initial demand for our hospitality services has been driven by our customers’ capital spending programs related to the construction and development of natural resource projects and associated infrastructure. Long-term demand for our services has been driven by natural resource production, maintenance, operation and expansion of those facilities. In general, industry capital spending programs are based on the outlook for commodity prices, production costs, economic growth, perceived political risk, global commodity supply/demand, reserve replacement requirements, estimates of resource production, annual maintenance requirements, inclusive of turnaround requirements, and the expectations of our customers' shareholders. As a result, demand for our hospitality services is sensitive to expected commodity prices, principally related to met coal, oil, iron ore and LNG, and the resultant impact of these commodity price expectations on our customers' spending. In addition to these historical demand drivers, there is increasing demand, of relative significance, for our assets and services tied to data center construction. This is principally occurring in the U.S. but could begin to occur in Australia and Canada as well. Other factors that can affect our business and financial results include the general global economic environment, including inflationary pressures, supply chain disruptions and labor shortages, the impact of global tariff changes and other changes to trade policies, volatility affecting the banking system and financial markets, availability of capital to the natural resource industry and regulatory changes in Australia, Canada and other markets, including governmental measures introduced to mitigate climate change.

Previous wording

(1)Source: Hard coking prices are from IHS Markit, iron ore prices and WCS crude prices are from Bloomberg and WTI crude prices are from U.S. Energy Information Administration.

Current wording

(1)Source: Hard coking coal prices are from IHS Markit, iron ore prices and WCS crude prices are from Bloomberg and WTI crude prices are from U.S. Energy Information Administration.

Previous wording

WCS Crude. In Canada, WCS crude is the benchmark price for our oil sands customers. Pricing for WCS is driven by several factors, including the underlying price for WTI crude, the availability of transportation infrastructure (consisting of pipelines and crude by railcar), refinery blending requirements and governmental regulation. Historically, WCS has traded at a discount to WTI, creating a “WCS Differential,” due to transportation costs and capacity restrictions to move Canadian heavy oil production to refineries, primarily along the U.S. Gulf Coast. The WCS Differential has varied depending on the extent of transportation capacity availability.

Current wording

WCS Crude. In Canada, WCS crude is the benchmark price for our oil sands customers. Pricing for WCS is driven by several factors, including the underlying price for WTI crude, the availability of transportation infrastructure (consisting of pipelines and crude by railcar), refinery blending requirements and governmental regulation. Historically, WCS has traded at a discount to WTI, creating a “WCS Differential,” due to transportation costs and export capacity limitations to move Canadian heavy oil production to refineries, primarily along the U.S. Gulf Coast. As a result of the U.S. government’s recent takeover of the Venezuelan oil production, there is a new a concern that Venezuelan heavy crude may displace refinery demand for Canadian heavy crude on the U.S. Gulf Coast.

Previous wording

WCS prices in the fourth quarter of 2024 averaged $57.50 per barrel compared to an average of $55.31 in the fourth quarter of 2023. The WCS Differential decreased from $19.35 per barrel at the end of the fourth quarter of 2023 to $13.49 at the end of the fourth quarter of 2024. As of February 21, 2025, the WTI price was $70.58 and the WCS price was $57.24, resulting in a WCS Differential of $13.34. Further, the Trump Administration has announced and is in the process of implementing a 10% tariff on energy resources imported to the U.S. from Canada. This tariff could widen the WCS differential and reduce Canadian oil producers' production and profits.

Current wording

WCS prices in the fourth quarter of 2025 averaged $46.73 per barrel compared to an average of $57.50 in the fourth quarter of 2024. The WCS Differential decreased from $12.92 per barrel at the end of the fourth quarter of 2024 to $12.50 at the end of the fourth quarter of 2025. Further, the U.S. administration implemented and amended several new tariffs during 2025. Implementation of tariffs on oil from Canada could have an adverse impact on our Canadian customers profit margins, which may in turn reduce their spending on our accommodations and services.

Previous wording

Inflationary Pressures. During 2023 and 2024, inflationary pressures and supply chain disruptions have been, and continue to be, experienced worldwide. Price increases resulting from inflation and supply chain concerns have, and are expected to continue to have, a negative impact on our labor and food costs, as well as consumable costs such as fuel. We are managing inflation risk with negotiated service scope changes and contractual protections.

Current wording

Inflationary Pressures. Since 2023, price increases resulting from pandemic-related inflation and supply chain concerns have, and are expected to continue to have, a negative impact on our labor and food costs, as well as consumable costs such as fuel. Lingering inflation from the pandemic has recently been exacerbated by changes to global tariffs and trade policies. We are managing inflation risk with negotiated service scope changes and contractual protections. Although inflation resulting from global tariffs implemented or threatened by the U.S. administration, and the resulting retaliations by its trading partners, did not materially impact our cost structure in 2025, concerns remain that inflationary pressures could return in the future.

Previous wording

Labor Shortages. In addition to the macro inflationary impacts on labor costs noted above, we continue to be impacted by increased staff costs as a result of hospitality labor shortages in Australia due to significantly reduced migration in and around Australia affecting labor availability, which has subsequently led to an increased reliance on more expensive temporary labor resources.

Current wording

Labor Shortages. In addition to the macro inflationary impacts on labor costs noted above, we continue to be impacted by increased staff costs as a result of hospitality labor shortages in Australia. Australia’s labor market remains historically tight, with unemployment holding just above 4% and job mobility (movement of workers between different employers or businesses) at its lowest in 30 years. A persistent overhang of vacancies continues to constrain recruitment, while government stimulus has disproportionately driven job growth in healthcare, aged care, education and public services. Despite easing inflation, regulated labor costs remain high, with the Fair Work Commission decisions pushing wage increases well above Consumer Price Index changes, and statutory increases in superannuation, workers’ compensation and payroll tax are further inflating total labor costs. For hospitality, this combination of scarce labor supply, competition from government-funded sectors and rising employment costs creates sustained pressure on staffing productivity and availability.

Previous wording

LNG. Our Sitka Lodge supports the LNG Canada (LNGC) project and related pipeline projects (specifically, the Coastal GasLink Pipeline, the pipeline constructed to transport natural gas feedstock to LNGC). LNGC, a joint venture among Shell Canada Energy, an affiliate of Shell plc (40 percent), and affiliates of PETRONAS, through its wholly-owned entity, North Montney LNG Limited Partnership (25 percent), PetroChina (15 percent), Mitsubishi Corporation (15 percent) and Korea Gas Corporation (5 percent), is currently constructing a liquefaction and export facility in Kitimat, British Columbia (Kitimat LNG Facility). Construction activity of Phase 1 of the Kitimat LNG Facility is nearing completion, with commercial operations expected to begin in mid-2025. The Coastal GasLink Pipeline was completed in 2024 and entered commercial operations. The majority of our contracted commitments associated with the Coastal GasLink Pipeline were completed in the fourth quarter of 2023. As such, we expect continued lower occupancy at our Sitka Lodge in the near-term until subsequent phases of the LNGC project are approved and commence, or additional construction activity in the region, drive increased occupancy demand.

Current wording

LNG. Our Sitka Lodge supports the LNG Canada (LNGC) project and related pipeline projects (specifically, the Coastal GasLink Pipeline, the pipeline constructed to transport natural gas feedstock to LNGC). Construction activity of Phase 1 of the Kitimat LNG Facility has been completed and commercial operations commenced at the end of June 2025. The Coastal GasLink Pipeline was completed in 2024. As such, we expect continued lower occupancy at our Sitka Lodge in the near-term until subsequent phases of the LNGC project are approved and commence, or additional construction activity in the region, drive increased occupancy demand.

Previous wording

Foreign Currency Exchange Rates. Exchange rates between the U.S. dollar and each of the Canadian dollar and the Australian dollar influence our U.S. dollar reported financial results. Our business has historically derived the vast majority of its revenues and operating income (loss) in Canada and Australia. These revenues and profits/losses are translated into U.S. dollars for financial reporting purposes under U.S. generally accepted accounting principles. The following summarizes the fluctuations in the exchange rates between the U.S. dollar and each of the Canadian dollar and the Australian dollar:

Current wording

Foreign Currency Exchange Rates. Exchange rates between the U.S. dollar and each of the Australian dollar and the Canadian dollar influence our U.S. dollar reported financial results. Our business has historically derived the vast majority of its revenues and operating income (loss) in Australia and Canada. These revenues and profits/losses are translated into U.S. dollars for financial reporting purposes under U.S. generally accepted accounting principles. The following summarizes the fluctuations in the exchange rates between the U.S. dollar and each of the Australian dollar and the Canadian dollar:

Previous wording

These fluctuations of the Canadian and Australian dollars have had and will continue to have an impact on the translation of earnings generated from our Canadian and Australian subsidiaries and, therefore, our financial results.

Current wording

These fluctuations of the Australian and Canadian dollars have had and will continue to have an impact on the translation of earnings generated from our Australian and Canadian subsidiaries and, therefore, our financial results.

Previous wording

Capital Expenditures. We continue to monitor the global economy, commodity prices, demand for met coal, crude oil, LNG and iron ore, inflation and the resultant impact on the capital spending plans of our customers in order to plan our business activities. We currently expect that our 2025 capital expenditures will be in the range of approximately $25 million to $30 million, compared to 2024 capital expenditures of $26.1 million. We may adjust our capital expenditure plans in the future as we continue to monitor customer activity.

Current wording

Capital Expenditures. We continue to monitor the global economy, commodity prices, demand for met coal, oil, iron ore and LNG, inflation, trade policy and the resultant impact on the capital spending plans of our customers in order to plan our business activities. We currently expect that our 2026 capital expenditures will be in the range of approximately $25 million to $30 million, of which $20 million is anticipated to relate to maintenance and $10 million related to growth and strategic initiatives, including investments in information technology infrastructure to support our business. This compares to 2025 capital expenditures of $20.2 million, of which $11.2 million is associated with maintenance and $9.0 million related to growth projects, including the reactivation of our Buffalo Lodge in Canada and Wi-Fi infrastructure improvements in Australia. We may adjust our capital expenditure plans in the future as we continue to monitor customer activity.

Previous wording

Cost of Sales and Services. Our consolidated cost of sales and services increased $2.4 million, or 0.4%, in 2024 compared to 2023. This increase was primarily due to increased occupancy at our Civeo owned villages in the Australian Bowen Basin and new business in our integrated services villages in Western Australia and the associated overhead costs. These items were partially offset by the decrease in cost of sales and services largely driven by reduced mobile asset activity from pipeline projects in Canada which were largely completed in 2023 and lower costs at certain lodges in Canada due to reduced occupancy. See below for further discussion of segment results of operations.

Current wording

Cost of Sales and Services. Our consolidated cost of sales and services decreased $44.9 million, or 8.4%, in 2025 compared to 2024. This decrease was primarily due to (i) lower costs at various lodges in Canada due to reduced occupancy levels, (ii) reduced costs at various lodges and reduced indirect costs as a result of various cost reduction measures in Canada implemented in late 2024 and early 2025, (iii) lower costs related to the reduced mobile asset activity in Canada from pipeline projects for which final costs were incurred in the first six months of 2024, (iv) reduced food service and other services costs in Canada as client maintenance work in 2024 did not recur to the same extent in 2025 and (v) a weaker Australian and Canadian dollar relative to the U.S. dollar in 2025 compared to 2024. These items were partially offset by an increase in Australia related to the Qantac Acquisition in the second quarter of 2025 and new business in our integrated services villages in Western Australia and Queensland and associated overhead costs. See below for further discussion of segment results of operations.

Previous wording

Selling, General and Administrative Expenses. SG&A expense increased $0.7 million, or 1%, in 2024 compared to 2023. This increase was primarily due to higher compensation expense of $5.4 million, higher professional fees of $2.6 million and higher travel and entertainment costs of $0.9 million. The increase in compensation expense was primarily due to $1.1 million in severance costs related to the departure of our former Chief Financial Officer, other severance costs and increased staff and associated recruitment costs. These items were partially offset by lower incentive compensation costs of $5.6 million, lower share-based compensation expense of $2.8 million and a weaker Australian and Canadian dollar relative to the U.S. dollar in 2024 compared to 2023. The decrease in share-based compensation expense was primarily due to forfeitures, reduced performance share expense due to a lower probability of achieving performance criteria during 2024 compared to 2023 and changes in our share price during 2024 compared to 2023.

Current wording

Selling, General and Administrative Expenses. SG&A expense increased $2.0 million, or 3%, in 2025 compared to 2024. This increase was primarily due to higher professional fees of $4.9 million due to shareholder activist related costs of $5.5 million in 2025 compared to 2024, partially offset by lower travel and entertainment costs of $1.1 million, down 38% year-of-year, lower office expenses of $1.1 million, lower incentive compensation cost of $0.9 million and a weaker Australian and Canadian dollar relative to the U.S. dollar in 2025 compared to 2024.

Previous wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $7.1 million, or 9%, in 2024 compared to 2023. The decrease was primarily due to certain assets becoming fully depreciated in Canada, including the McClelland Lake Lodge, in 2023 and lower depreciation and amortization expense due to a weaker Australian and Canadian dollar relative to the U.S. dollar in 2024 compared to 2023. These items were partially offset by higher depreciation and amortization expense due to additional property, plant and equipment placed in service during 2024.

Current wording

Depreciation and Amortization Expense. Depreciation and amortization expense increased $4.6 million, or 7%, in 2025 compared to 2024. The increase was primarily due to additional property, plant and equipment acquired through the Qantac Acquisition and shortening the lives on certain assets in Canada, partially offset by a weaker Australian and Canadian dollar relative to the U.S. dollar in 2025 compared to 2024 and reduced depreciation expense resulting from impairments recorded in 2024.

Previous wording

Impairment Expense. We recorded pre-tax impairment expense of $11.6 million in 2024 associated with long-lived assets in Australia, Canada and the U.S. We recorded pre-tax impairment expense of $1.4 million in 2023 associated with long-lived assets in Australia and the U.S.

Current wording

Impairment Expense. We recorded pre-tax impairment expense of $11.6 million in 2024 associated with long-lived assets in Australia and the U.S.

Previous wording

Gain on Sale of McClelland Lake Lodge Assets, net. We recorded $5.7 million and $18.6 million in net gains associated with the sale of the McClelland Lake Lodge in 2024 and 2023, respectively.

Current wording

Gain on Sale of McClelland Lake Lodge Assets, net. We recorded $5.7 million in net gains associated with the sale of the McClelland Lake Lodge in 2024.

Previous wording

Operating Income. Operating income decreased $38.2 million, or 97%, in 2024 compared to 2023 primarily due to reduced mobile asset activity and lower lodge occupancy in Canada, higher impairment expenses and lower gain on sale of McClelland Lake Lodge assets in 2024 compared to 2023. These items were partially offset by higher activity levels in Australia and lower depreciation and amortization expense in 2024 compared to 2023.

Current wording

Operating Income. Operating income increased $2.8 million, or 209%, in 2025 compared to 2024 primarily due to higher activity levels in Australia in 2025 compared to 2024 and impairment expenses recorded in 2024. These items were partially offset by lower lodge occupancy in Canada, higher depreciation and amortization expense and higher SG&A expense in 2025 compared to 2024. In addition, 2024 included a net gain on sale of McClelland Lake Lodge assets.

Previous wording

Interest Expense, net. Net interest expense decreased $5.2 million, or 40%, in 2024 compared to 2023 primarily related to lower average debt levels during 2024 compared to 2023, which decreased approximately 35%.

Current wording

Interest Expense, net. Net interest expense increased $3.5 million, or 45%, in 2025 compared to 2024, primarily related to higher average debt levels, partially offset by lower interest rates on credit facility borrowings in 2025 compared to 2024.

Previous wording

Income Tax Expense. Our income tax expense for 2024 totaled $12.5 million, or (210.4)% of pretax loss, compared to an expense of $10.6 million, or 26.3% of pretax income for 2023. Our effective tax rate for 2024 was lower than the Canadian federal statutory rate of 15% primarily due to pre-tax losses in Canada with no corresponding tax benefit. Our effective tax rate for 2023 was higher than the Canadian federal statutory rate of 15%, primarily due to pre-tax income in Australia being taxed at the higher Australian income tax rate of 30%. Full valuation allowances are maintained against net deferred tax assets in both Canada and the U.S. In 2024, the tax benefit in Canada was offset by an increase to the valuation allowance of $8.5 million and a deferred tax benefit in Australia was offset by an increase to the valuation allowance of $0.6 million. In 2023, tax expense in Canada and the U.S. was offset by a valuation allowance release of $1.7 million and $0.8 million, respectively.

Current wording

Income Tax Expense. Our income tax expense for 2025 totaled $13.6 million, or (211.0)% of pretax loss, compared to an expense of $12.5 million, or (210.4)% of pretax loss for 2024. Our effective tax rate for 2025 and 2024 was lower than the Canadian federal statutory rate of 15% primarily due to pre-tax losses in Canada and the U.S. with no corresponding tax benefit. Full valuation allowances are maintained against net deferred tax assets in both Canada and the U.S. In 2025, the tax benefit in Canada and the U.S. was offset by an increase to the valuation allowance of $10.6 million.

Previous wording

Other Comprehensive Income (Loss). Other comprehensive income decreased $28.6 million in 2024 compared to 2023 primarily as a result of foreign currency translation adjustments due to changes in the Canadian and Australian dollar exchange rates compared to the U.S. dollar. The Canadian dollar exchange rate compared to the U.S. dollar decreased 8.1% in 2024 compared to a 2.4% increase in 2023. The Australian dollar exchange rate compared to the U.S. dollar decreased 9.0% in 2024 compared to a 0.2% increase in 2023.

Current wording

Other Comprehensive Income (Loss). Other comprehensive income increased $37.8 million in 2025 compared to 2024 primarily as a result of foreign currency translation adjustments due to changes in the Australian and Canadian dollar exchange rates compared to the U.S. dollar. The Australian dollar exchange rate compared to the U.S. dollar increased 7.7% in 2025 compared to a 9.0% decrease in 2024. The Canadian dollar exchange rate compared to the U.S. dollar increased 5.0% in 2025 compared to an 8.1% decrease in 2024.

Previous wording

(3)Average daily rate is based on billed rooms and accommodation and other services revenue.

Current wording

(3)Average daily rate is based on billed rooms and accommodation revenue in the Company's owned villages.

Previous wording

Our Australian segment gross margin as a percentage of revenues decreased from 27.8% in 2023 to 26.1% in 2024. This decrease was primarily driven by an increased relative revenue contribution from our integrated services business, which has a service-only business model and therefore generates lower overall gross margins than our accommodation business. The reduced gross margin was partially offset by improved profitability across our integrated services villages in 2024.

Current wording

Our Australian segment gross margin as a percentage of revenues increased from 26.1% in 2024 to 26.3% in 2025. This was primarily driven by increased relative contribution from our accommodation business associated with the Qantac Acquisition and improved profitability across our integrated services villages in 2025. Our accommodation business generates higher gross margins than our integrated services business which has a service-only business model.

Previous wording

(4)Average daily rate is based on billed rooms and accommodation and other services revenue.

Current wording

(4)Average daily rate is based on billed rooms and accommodation revenue in the Company's owned lodges.

Previous wording

Our Canadian segment reported revenues in 2024 that were $107.7 million, or 31%, lower than 2023. The weakening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 1.5% in 2024 compared to 2023 resulted in a $3.1 million period-over-period decrease in revenues. Excluding the impact of the weaker Canadian exchange rate, the revenue decrease was driven by (i) reduced mobile asset activity from pipeline projects which were largely completed in 2023, (ii) lower billed rooms at our oil sands lodges due to the timing and extent of maintenance activity by our customers, (iii) reduced occupancy associated with the sale of the McClelland Lake Lodge and (iv) reduced occupancy at our Sitka Lodge as the Kitimat LNG facility nears completion.

Current wording

Our Canadian segment reported revenues in 2025 that were $66.5 million, or 27%, lower than 2024. The weakening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 2.0% in 2025 compared to 2024 resulted in a $3.6 million period-over-period decrease in revenues. Excluding the impact of the weaker Canadian exchange rate, the revenue decrease was driven by (i) lower billed rooms at our oil sands lodges, down 29% year-over-year, as producers in the region remain focused on reducing operating costs, (ii) reduced occupancy at our Sitka Lodge beginning in the third quarter of 2024 as the Kitimat LNG facility was nearing completion and subsequently commenced operations in the second quarter of 2025 and (iii) lower food service and other services revenue as client maintenance work in 2024 did not recur to the same extent in 2025.

Previous wording

Our Canadian segment cost of sales and services decreased $69.9 million, or 25%, in 2024 compared to 2023. The weakening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 1.5% in 2024 compared to 2023 resulted in a $2.8 million period-over-period decrease in cost of sales and services. Excluding the impact of the weaker Canadian exchange rate, the decrease in cost of sales and services was driven by lower costs related to the reduced mobile asset activity from pipeline projects which were largely completed in 2023 and lower costs at various lodges due to reduced occupancy levels.

Current wording

Our Canadian segment cost of sales and services decreased $59.1 million, or 29%, in 2025 compared to 2024. The weakening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 2.0% in 2025 compared to 2024 resulted in a $3.1 million period-over-period decrease in cost of sales and services. Excluding the impact of the weaker Canadian exchange rate, the decrease in cost of sales and services was largely driven by (i) lower costs at various lodges due to reduced occupancy levels, (ii) reduced costs at various lodges and reduced indirect costs as a result of various cost reduction measures implemented in late 2024 and early 2025, (iii) lower costs related to the reduced mobile asset activity from pipeline projects for which final costs were incurred in the first six months of 2024 and (iv) reduced food service and other services costs as client maintenance work in 2024 did not recur to the same extent in 2025.

Previous wording

Our primary liquidity needs are to fund capital expenditures, which in the past have included expanding and improving our hospitality services, developing new lodges and villages and purchasing or leasing land, to pay dividends, to repurchase common shares and for general working capital needs. In addition, capital has been used to repay debt and fund strategic business acquisitions. Historically, our primary sources of funds have been available cash, cash flow from operations, borrowings under our Credit Agreement and proceeds from equity issuances. In the future, capital may be required to move lodges from one site to another, and we may seek to access the debt and equity capital markets from time to time to raise additional capital, increase liquidity, fund acquisitions or refinance debt.

Current wording

Our primary liquidity needs are to fund capital expenditures, which in the past have included expanding and improving our hospitality services, developing new lodges and villages and purchasing or leasing land, to repurchase common shares, to pay dividends and for general working capital needs. In addition, capital has been used to repay debt and fund strategic business acquisitions. Historically, our primary sources of funds have been available cash, cash flow from operations, borrowings under our Credit Agreement and proceeds from equity issuances. In the future, we may seek to access the debt and equity capital markets from time to time to raise additional capital, increase liquidity, fund acquisitions or refinance debt.

Previous wording

(1)Interest payments due under the Credit Agreement, which matures on August 8, 2028; based on an interest rate of 6.1% for Canadian revolver borrowings.

Current wording

(1)Interest payments due under the Credit Agreement, which matures on August 8, 2028; based on an interest rate of 5.9% for Canadian revolver borrowings.

Previous wording

(1)As of December 31, 2024, $3.6 million of our borrowing capacity under the Credit Agreement could not be utilized in order to maintain compliance with the maximum leverage ratio financial covenant in the Credit Agreement.

Current wording

(1)As of December 31, 2025 and 2024, $5.3 million and $3.6 million, respectively, of our borrowing capacity under the Credit Agreement could not be utilized in order to maintain compliance with the maximum leverage ratio financial covenant in the Credit Agreement.

Previous wording

Cash totaling $83.5 million was provided by operations during 2024 compared to $96.6 million provided by operations during 2023. During 2024 and 2023, $31.8 million was provided by working capital and $1.6 million was used in working capital, respectively. The year-over-year increase in cash provided by working capital in 2024 compared to 2023 is largely due to the collection of holdbacks in Canada related to the completion of mobile asset pipeline projects during 2024 compared to 2023, partially offset by decreased accounts payable and accrual balances.

Current wording

Cash totaling $22.3 million was provided by operations during 2025 compared to $83.5 million provided by operations during 2024. During 2025 and 2024, $28.9 million was used in working capital and $31.8 million was provided by working capital, respectively. The year-over-year increase in cash used in working capital in 2025 compared to 2024 is largely due to higher cash taxes paid in Australia in 2025 compared to 2024 and the collection of receivables in Canada related to the completion of mobile asset pipeline projects 2024 that did not recur in 2025. These items were partially offset by a decrease in cash used for accounts payable and accrued liabilities during 2025 compared to 2024.

Previous wording

Cash used in investing activities during 2024 totaled $14.9 million compared to cash used in investing activities during 2023 of $14.5 million. The increase in cash used in investing activities was primarily due to lower proceeds from the sale of property, plant and equipment, partially offset by lower capital expenditures. We received net proceeds from the sale of property, plant and equipment of $11.0 million during 2024 related to the sale of our McClelland Lake Lodge accommodation assets in Canada and the sale of our Louisiana land in the U.S., compared to $16.7 million during 2023 primarily related to the sale of our McClelland Lake Lodge accommodation assets in Canada and Louisiana accommodation assets in the U.S. Capital expenditures totaled $26.1 million and $31.6 million during 2024 and 2023, respectively. Capital expenditures in both periods were primarily related to maintenance. In addition, our 2024 capital expenditures included approximately $2.9 million related to customer-funded infrastructure upgrades in Australia compared to $10.0 million in 2023.

Current wording

Cash used in investing activities during 2025 totaled $90.1 million compared to cash used in investing activities during 2024 of $14.9 million. The increase in cash used in investing activities was primarily due to the Qantac Acquisition and lower proceeds from the sale of property, plant and equipment, partially offset by lower capital expenditures. We received net proceeds from the sale of property, plant and equipment of $2.2 million during 2025 related to the sale of accommodation assets in Canada compared to $11.0 million during 2024 related to the sale of our McClelland Lake Lodge accommodation assets in Canada and the sale of our Louisiana land in the U.S. Capital expenditures totaled $20.2 million and $26.1 million during 2025 and 2024, respectively. Capital expenditures in both periods were primarily related to maintenance. In addition, our 2024 capital expenditures included approximately $2.9 million related to customer-funded infrastructure upgrades in Australia.

Previous wording

Based on management’s judgment of capital spending classifications, we believe the following represents the components of capital expenditures for the years ended December 31, 2024 and 2023 (in millions):

Current wording

Based on management’s judgment of capital spending classifications, we believe the following represents the components of capital expenditures and the associated percentage of revenue for the years ended December 31, 2025 and 2024 (in millions):

Previous wording

Expansion lodge and village spending in 2024 was related to costs associated with the customer-supported reactivation of our Buffalo Lodge in Canada and customer-funded infrastructure upgrades at three Australian villages. Expansion lodge and village spending in 2023 was largely related to customer-funded infrastructure upgrades at three Australian villages.

Current wording

Expansion lodge and village spending in 2025 was primarily related to final costs associated with the reactivation of our Buffalo Lodge in Canada, as well as purchases supporting new contracts at our integrated services business and the Qantac Acquisition in Australia. Expansion lodge and village spending in 2024 was primarily related to costs associated with the customer-supported reactivation of our Buffalo Lodge in Canada and customer-funded infrastructure upgrades at three Australian villages.

Previous wording

Other maintenance and expansion spending in 2024 was primarily related to miscellaneous equipment and supplies to support the day-to-day operations at our accommodation and laundry facilities, purchases to support new contacts at our integrated services business in Australia and information technology infrastructure to support our business. Other maintenance and expansion spending in 2023 was primarily related to miscellaneous equipment and supplies to support the day-to-day operations at our accommodation and laundry facilities and information technology infrastructure to support our business.

Current wording

Other maintenance and expansion spending in 2025 was primarily related to Wi-Fi infrastructure at certain Australian villages, miscellaneous equipment and supplies to support the day-to-day operations at our accommodation facilities and information technology infrastructure to support our business. Other maintenance and expansion spending in 2024 was primarily related to miscellaneous equipment and supplies to support the day-to-day operations at our accommodation and laundry facilities, purchases to support new contacts at our integrated services business in Australia and information technology infrastructure to support our business.

Previous wording

Cash used in financing activities during 2024 of $65.2 million was primarily due to (i) repurchases of our common shares of $29.6 million, (ii) dividend payments of $14.4 million, (iii) net repayments under our revolving credit facilities of $17.1 million, (iv) debt issuance costs of $3.0 million and (v) payments to settle tax obligations of $1.1 million. Cash used in financing activities during 2023 of $86.8 million was primarily due to (i) net repayments under our revolving credit facilities of $37.8 million, (ii) repayments of term loan borrowings of $29.9 million, (iii) repurchases of our common shares of $11.6 million and (iv) dividend payments of $7.4 million.

Current wording

Cash provided by financing activities during 2025 of $74.7 million was primarily due to net borrowings under our revolving credit facilities of $132.8 million primarily to fund the Qantac Acquisition and share repurchases, partially offset by (i) repurchases of our common shares of $53.6 million, (ii) dividend payments of $3.4 million, (iii) payments to settle tax obligations of $0.6 million and (iv) debt issuance costs of $0.4 million. Cash used in financing activities during 2024 of $65.2 million was primarily due to (i) repurchases of our common shares of $29.6 million, (ii) net repayments under our revolving credit facilities of $17.1 million, (iii) dividend payments of $14.4 million, (iv) debt issuance costs of $3.0 million and (v) payments to settle tax obligations of $1.1 million.

Previous wording

We believe that cash on hand and cash flow from operations will be sufficient to meet our anticipated liquidity needs for the next 12 months. If our plans or assumptions change, including as a result of changes in our customers' capital spending or changes in the price of and demand for natural resources, or are inaccurate, or if we make acquisitions, we may need to raise additional capital. Acquisitions have been, and our management believes acquisitions will continue to be, an element of our long-term business strategy. The timing, size or success of any acquisition effort and the associated potential capital commitments are unpredictable and uncertain. We may seek to fund all or part of any such efforts with proceeds from debt and/or equity issuances or may issue equity directly to the sellers. Our ability to obtain capital for additional projects to implement our growth strategy over the longer term will depend on our future operating performance, financial condition and, more broadly, on the availability of equity and debt financing. Capital availability will be affected by prevailing conditions in our industry, the global economy, the global financial markets and other factors, many of which are beyond our control. In addition, any additional debt service requirements we take on could be based on higher interest rates and shorter maturities and could impose a significant burden on our results of operations and financial condition, and the issuance of additional equity securities could result in significant dilution to shareholders.

Current wording

We believe that cash on hand and cash flow from operations will be sufficient to meet our anticipated liquidity needs for the next 12 months. If our plans or assumptions change, including as a result of changes in our customers' capital spending or changes in the price of and demand for natural resources, or are inaccurate, or if we make acquisitions, we may need to raise additional capital. Selectively pursuing strategic organic and inorganic growth opportunities that fit with our current capital allocation priorities of returning capital to shareholders has been, and our management believes will continue to be, an element of our long-term business strategy. The timing, size or success of any growth opportunities and the associated potential capital commitments are unpredictable and uncertain. We may seek to fund all or part of any such efforts with proceeds from debt and/or equity issuances or may issue equity directly to the sellers. Our ability to obtain capital for additional projects to implement our growth strategy over the longer term will depend on our future operating performance, financial condition and, more broadly, on the availability of equity and debt financing. Capital availability will be affected by prevailing conditions in our industry, the global economy, the global financial markets and other factors, many of which are beyond our control. In addition, any additional debt service requirements we take on could be based on higher interest rates and shorter maturities and could impose a significant burden on our results of operations and financial condition, and the issuance of additional equity securities could result in significant dilution to shareholders.

Previous wording

In September 2024, our Board authorized a common share repurchase program to repurchase up to 5.0% of our total common shares which are issued and outstanding, or 710,556 common shares, over a twelve-month period. In addition, our Board declared quarterly dividends of $0.25 per common share to shareholders beginning in the third quarter of 2023. Dividend payments of $14.3 million and $7.4 million were made to shareholders in 2024 and 2023, respectively. These dividends are eligible dividends pursuant to the Income Tax Act (Canada). See Note 16 – Share Repurchase Programs and Dividends to the notes to the consolidated financial statements included in Item 8 of this annual report for further discussion.

Current wording

In addition, our Board declared quarterly dividends of $0.25 per common share to shareholders beginning in the third quarter of 2023 through the first quarter of 2025. Dividend payments of $3.4 million, $14.3 million and $7.4 million were made to shareholders in 2025, 2024 and 2023, respectively. These dividends are eligible dividends pursuant to the Income Tax Act (Canada). See Note 15 – Share Repurchase Programs and Dividends to the notes to the consolidated financial statements included in Item 8 of this annual report for further discussion.

Previous wording

As of December 31, 2024, the Credit Agreement provided for: (i) a $245.0 million revolving credit facility scheduled to mature on August 8, 2028, allocated as follows: (A) a $10.0 million senior secured revolving credit facility in favor of certain of our U.S. subsidiaries, as borrowers; (B) a $200.0 million senior secured revolving credit facility in favor of Civeo and certain of our U.S. subsidiaries, as borrowers; and (C) a $35.0 million senior secured revolving credit facility in favor of one of our Australian subsidiaries, as borrower.

Current wording

As of December 31, 2025, the Credit Agreement provided for: (i) a $265.0 million revolving credit facility scheduled to mature on August 8, 2028, allocated as follows: (A) a $10.0 million senior secured revolving credit facility in favor of certain of our U.S. subsidiaries, as borrowers; (B) a $200.0 million senior secured revolving credit facility in favor of Civeo and certain of our U.S. subsidiaries, as borrowers; and (C) a $55.0 million senior secured revolving credit facility in favor of one of our Australian subsidiaries, as borrower.

Previous wording

As of December 31, 2024, we had outstanding letters of credit of $0.3 million under the U.S. facility, zero under the Australian facility and $0.8 million under the Canadian facility. We also had outstanding bank guarantees of A$2.1 million under the Australian facility.

Current wording

As of December 31, 2025, we had outstanding letters of credit of zero under the U.S. facility, zero under the Australian facility and $0.9 million under the Canadian facility. We also had outstanding bank guarantees of A$1.4 million under the Australian facility.

Previous wording

We intend to pay regular quarterly dividends on our common shares, with all future dividend payments subject to quarterly review and approval by our Board. The declaration and amount of all potential future dividends will be at the discretion of our Board and will depend upon many factors, including our financial condition, results of operations, cash flows, prospects, industry conditions, capital requirements of our business, covenants associated with certain debt obligations, legal requirements, regulatory constraints, industry practice and other factors the Board deems relevant. In addition, our ability to pay cash dividends on common shares is limited by covenants in the Credit Agreement. Future agreements may also limit our ability to pay dividends, and we may incur incremental taxes if we are required to repatriate foreign earnings to pay such dividends. The amount per share of our dividend payments may be changed, or dividends may be suspended, without advance notice. The likelihood that dividends will be reduced or suspended is increased during periods of market weakness. There can be no assurance that we will continue to pay a dividend in the future.

Current wording

In April 2025, our Board suspended quarterly dividends on our common shares to prioritize returning capital to our shareholders through ongoing share repurchases. The declaration and amount of any potential future dividends will be at the discretion of our Board and will depend upon many factors, including our financial condition, results of operations, cash flows, prospects, industry conditions, capital requirements of our business, covenants associated with certain debt obligations, legal requirements, regulatory constraints, industry practice and other factors the Board deems relevant. In addition, our ability to pay cash dividends on common shares is limited by covenants in the Credit Agreement. Future agreements may also limit our ability to pay dividends, and we may incur incremental taxes if we are required to repatriate foreign earnings to pay such dividends. If any dividends are declared in the future, the amount per share of our dividend payments may be changed, or dividends may again be suspended, without advance notice. The likelihood that dividends will be reduced or suspended is increased during periods of market weakness. There can be no assurance that we will pay any dividends in the future.

Previous wording

Our Australia segment consists of eight villages in several regions within the country, as well as our integrated services assets and land banked assets. These properties are grouped in the following asset groups:

Current wording

Our Australia segment consists of various villages in several regions within the country, as well as our integrated services assets and land banked assets. These properties are grouped in the following asset groups: