Civeo Corp

Previous 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 may be sensitive to expected commodity prices, principally related to metallurgical (met) coal, oil, iron ore and liquefied natural gas (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 for our assets and services tied to data center construction, electrification projects and associated infrastructure. This is principally occurring in the United States (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.

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 dynamics, 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 may be sensitive to expected commodity prices, principally related to metallurgical (met) coal, oil, iron ore and liquefied natural gas (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 for our assets and services tied to data center construction, electrification projects and associated infrastructure. This is principally occurring in the United States (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

While prices for the commodities that our customers produce stabilized in late 2025 and remained elevated through the first half of 2026, there remains continued risk of future volatility, particularly in light of ongoing geopolitical tensions in the Middle East and continuing uncertainty surrounding global trade policy. The factors that could drive such volatility and underlying activity include the ongoing conflict involving Iran, expectations for global macroeconomic stability and growth, inflationary pressures, higher interest rates, economic growth (or contraction) in China and resultant economic stimulus by the Chinese government, the impact of changes to global tariff and trade policies, actions taken by Organization of the Petroleum Exporting Countries Plus (OPEC+) to adjust oil production levels, other geopolitical events such as the ongoing conflicts in Russia and Ukraine, U.S. oil production levels and regulatory implications on such prices. In Canada, ongoing tensions between the U.S. and Canadian governments regarding trade policy may spur Canadian infrastructure projects, including pipelines for LNG or oil, carbon capture installation for oil producing operations and mining for critical minerals.

Current wording

Prices for the commodities that our customers produce remained elevated through the first nine months of 2026, although there remains continued risk of future volatility, particularly in light of ongoing geopolitical tensions in the Middle East and continuing uncertainty surrounding global trade policy. The factors that could drive such volatility and underlying activity include the ongoing conflict involving Iran, expectations for global macroeconomic stability and growth, inflationary pressures, interest rates, economic growth (or contraction) in China and resultant economic stimulus by the Chinese government, the impact of changes to global tariff and trade policies, actions taken by Organization of the Petroleum Exporting Countries Plus (OPEC+) to adjust oil production levels, other geopolitical events such as the ongoing conflicts in Russia and Ukraine, U.S. oil production levels and regulatory implications on such prices. In Canada, ongoing uncertainty regarding trade policy between the U.S. and Canada may spur Canadian infrastructure projects, including pipelines for LNG or oil, carbon capture installation for oil producing operations and mining for critical minerals.

Previous wording

Met Coal. In Australia, 86% of our Australian owned rooms are located in the Bowen Basin of Queensland, Australia and primarily serve met coal mines in that region. Met coal pricing and production growth in the Bowen Basin region is predominantly influenced by global steel production, which remained subdued throughout 2025 and into 2026. China, Japan, Brazil and Russia experienced declines in steel production through the first half of 2026, while India and the U.S. continue to see consistent positive growth in 2026. Global tariff developments and recession fears are weighing on current and near-term global steel production, while the ongoing conflict in the Middle East has contributed to further economic and trade uncertainty. While there has been no noticeable impact on met coal prices to date, input costs for producers are expected to increase, particularly due to higher diesel prices.

Current wording

Met Coal. In Australia, 86% of our Australian owned rooms are located in the Bowen Basin of Queensland, Australia and primarily serve met coal mines in that region. Met coal pricing and production growth in the Bowen Basin region are predominantly influenced by global steel production, which remained subdued throughout 2025 and into 2026. China, Japan, Brazil and Russia continued to experience declines in steel production through the first nine months of 2026, while India, Germany and the U.S. continue to experience positive growth in 2026. Global tariff developments, economic uncertainty and weaker Chinese demand continue to weigh on global steel production, while the ongoing conflict in the Middle East has contributed to further economic and trade uncertainty. While met coal prices improved during the third quarter of 2026, producers continue to manage inflationary costs pressures, particularly higher diesel prices resulting from disruptions in global seaborne crude oil and refined products trade.

Previous wording

Global steel production decreased by 0.7% for the six months through June 2026 compared to the same period in 2025. As of July 27, 2026, met coal spot prices were $219.60 per tonne.

Current wording

Global steel production decreased by 0.7% for the nine months through September 30, 2026 compared to the same period in 2025. As of October 26, 2026, met coal spot prices were $266.05 per tonne.

Previous wording

Although met coal prices remain well supported above $200 per tonne in the first half of 2026, there is still a heightened focus on cost management for producers which has carried over from 2025. The Middle East conflict has resulted in trade disruption, specifically the seaborne transport of oil and LNG through the Strait of Hormuz, increasing the price of oil, gasoline and diesel, putting further pressure on cost containment if fuel costs continue to stay elevated. In late 2025, several large and mid-tier met coal producers in Queensland, Australia announced production cuts and workforce reductions. This activity continued to slow in the first half of 2026. While met coal prices have settled at a more profitable level in 2026, additional supply is expected to continue entering the market from both Australia and the U.S. during 2026, which could place downward pressure on pricing towards $220 per tonne. These supply and demand dynamics may also be impacted by ongoing geopolitical uncertainties, including the conflict in the Middle East.

Current wording

Although met coal prices were higher year-over-year during the first nine months of 2026, producers continue to maintain a heightened focus on cost management following production cuts and workforce reductions announced by several large and mid-tier producers in Queensland, Australia during late 2025. The Middle East conflict has disrupted the seaborne transportation of oil, LNG and refined products through the Strait of Hormuz, contributing to higher oil, gasoline and diesel prices and putting further pressure on producer costs. More recently, met coal prices increased as a result of domestic supply constraints in China. As these supply constraints are expected to ease and strong production continues in Australia, downward pressure on prices towards $240 per tonne is expected during the fourth quarter of 2026. These supply and demand dynamics may also be impacted by steel demand and ongoing geopolitical uncertainties, including the conflict in the Middle East.

Previous wording

Iron Ore. Iron ore prices fluctuated between $92 and $107 through early 2026 before easing below $100 in late June, driven by softer steel demand and continued strong iron ore supply. While demand in China remained subdued amid slower construction activity and ongoing steel industry reforms, production from major exporters, including Australia and Brazil, remained strong throughout the first half of 2026. As a result, market sentiment remained cautious heading into the third quarter of 2026, with iron ore prices continuing to be influenced by the balance between global supply and steel demand.

Current wording

Chinese steel demand remained subdued due to policy constraints and declining investment, while iron ore supply from major exporters, including Australia and Brazil, remained strong. In addition, higher input costs, including increased met coal prices, have pressured Chinese steel producer margins. As a result, iron ore prices declined into the low $90s per tonne late in the third quarter of 2026. Market sentiment remains cautious heading into the fourth quarter of 2026, with iron ore prices expected to continue to be influenced by the balance between global supply and steel demand.

Previous wording

Current geopolitical conditions have increased volatility in the oil markets, making it more difficult to forecast spending and activity for our Canadian oil customers.

Current wording

In an effort to retain and recapture global market share, OPEC+ began reversing previously implemented production cuts at the beginning of the second quarter of 2025 and continued increasing production through September 2026. OPEC+ subsequently announced that participating countries would maintain September production levels in October 2026. Current geopolitical conditions continue to increase volatility in the oil markets, making it more difficult to forecast spending and activity for our Canadian oil customers.

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 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 concern that Venezuelan heavy crude may displace refinery demand for Canadian heavy crude on the U.S. Gulf Coast over time.

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.

Previous wording

WCS prices in the second quarter of 2026 averaged $73.05 per barrel compared to an average of $53.15 in the second quarter of 2025. The WCS Differential increased from an average of $12.50 per barrel at the end of the fourth quarter of 2025 to an average of $20.07 at the end of the second quarter of 2026. Changes to global tariff and trade policies affecting 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. With near-term higher prices, Canadian oil sands customers are prioritizing production while focusing on capital discipline and reducing downtime, while continuing to strive for lower operating costs and lower headcount.

Current wording

WCS prices in the third quarter of 2026 averaged $66.21 per barrel compared to an average of $52.48 in the third quarter of 2025. The WCS Differential increased from an average of $12.50 per barrel at the end of the fourth quarter of 2025 to an average of $19.94 at the end of the third quarter of 2026. Changes to global tariff and trade policies affecting 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. With higher oil prices during 2026, overall Canadian market sentiment has improved, while oil sands customers are prioritizing production, focusing on capital discipline and reducing downtime, while continuing to strive for lower operating costs and lower headcount.

Previous wording

Inflationary Pressures. Since 2023, price increases resulting from pandemic-related inflation and supply chain disruptions have, and are expected to continue to have, a negative impact on our labor, food and consumable costs, including 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 or the first half of 2026, concerns remain that inflationary pressures could return in the future.

Current wording

Inflationary Pressures. Since 2023, price increases resulting from pandemic-related inflation and supply chain disruptions have, and are expected to continue to have, a negative impact on our labor, food and consumable costs, including 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 or for the nine months ended September 30, 2026, concerns remain that inflationary pressures could return in the future.

Previous wording

The conflict with Iran and the associated disruptions to shipping through the Strait of Hormuz has adversely affected seaborne trade, specifically the transportation of oil and LNG in the Middle East. Australia imports the majority of its oil and petroleum products, including gasoline and diesel. As a result, continued disruption of trade through the Strait of Hormuz, or a further escalation of the conflict, could materially increase gasoline and diesel prices in Australia, contribute to increased inflation expectations and increase the risk of higher fuel and transportation costs.

Current wording

The conflict with Iran and the associated disruptions to oil, LNG and refined products production and shipping in the Middle East have contributed to higher global oil and other refined product prices during 2026. Australia imports the majority of its oil and petroleum products, including gasoline and diesel. As a result, continued disruption to Middle East energy production and trade, or a further escalation of the conflict, could materially increase gasoline and diesel prices in Australia, contribute to increased inflation expectations and increase the risk of higher fuel and transportation costs.

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), as well as Cedar LNG. Phase 1 of the LNGC facility commenced commercial operations in June 2025 and the Coastal GasLink Pipeline was completed in 2024. As such, we continue to expect lower occupancy levels at our Sitka Lodge in the near-term until additional phases of the LNGC project are approved and commence, or further regional construction activity increases occupancy demand.

Current wording

LNG. Our Sitka Lodge supports the LNG Canada (LNGC) project and related pipeline projects (specifically, the Coastal GasLink (CGL) Pipeline, the pipeline constructed to transport natural gas feedstock to LNGC), as well as Cedar LNG. Phase 1 of the LNGC facility commenced commercial operations in June 2025 and the CGL Pipeline was completed in 2024. On September 28, 2026, the LNGC joint venture participants announced a final investment decision to proceed with Phase 2 of the LNGC project, which is expected to double the facility's LNG production capacity. Construction activity associated with LNGC Phase 2 and the CGL Pipeline expansion is expected to support accommodation demand in the region.

Previous wording

From a macroeconomic standpoint, LNG demand has continued to grow, reinforcing the need for the global LNG industry to expand access to natural gas. Evolving government energy policies around the world have amplified support for cleaner energy supply, creating more opportunities for natural gas and LNG. Ongoing geopolitical conflicts have reinforced the importance for secure natural gas supply globally, particularly in Europe. Accordingly, we expect additional investment in LNG supply will be needed to meet the resulting expected long-term LNG demand growth.

Current wording

From a macroeconomic standpoint, LNG demand has continued to grow, reinforcing the need for the global LNG industry to expand access to natural gas. Evolving government energy policies around the world and ongoing geopolitical conflicts have reinforced the importance of secure and diversified natural gas supply globally, particularly in Europe and Asia. Accordingly, we expect additional investment in LNG supply will be needed to meet the resulting expected long-term LNG demand growth.

Previous 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, compared to 2025 capital expenditures of $20.2 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 $30 million to $35 million, compared to 2025 capital expenditures of $20.2 million. We may adjust our capital expenditure plans in the future as we continue to monitor customer activity.

Previous wording

Unless otherwise indicated, discussion of results for the three and six months ended June 30, 2026, is based on a comparison to the corresponding period of 2025.

Current wording

Unless otherwise indicated, discussion of results for the three and nine months ended September 30, 2026, is based on a comparison to the corresponding period of 2025.

Previous wording

We reported net loss attributable to Civeo for the quarter ended June 30, 2025 of $3.3 million, or $0.25 per diluted share. Net loss included $3.2 million of shareholder activist related costs and $0.5 million of cost saving initiatives in Canada related to two lodge closures.

Current wording

We reported net loss attributable to Civeo for the quarter ended September 30, 2025 of $0.5 million, or $0.04 per diluted share. Net loss included $0.6 million of shareholder activist related costs and $0.2 million of cost saving initiatives in Canada.

Previous wording

Revenues. Consolidated revenues increased $17.3 million, or 11%, in the second quarter of 2026 compared to the second quarter of 2025. This increase was primarily driven by (i) new integrated services business in Queensland and Canada, (ii) contributions in Australia from the Qantac Acquisition in the second quarter of 2025, (iii) higher billed rooms at our Canadian lodges and (iv) a stronger Australian dollar relative to the U.S. dollar in the second quarter of 2026 compared to the second quarter of 2025. These increases were partially offset by reduced occupancy at our legacy Bowen Basin villages in Queensland. See the discussion of segment results of operations below for further information.

Current wording

Revenues. Consolidated revenues increased $22.6 million, or 13%, in the third quarter of 2026 compared to the third quarter of 2025. This increase was primarily driven by (i) higher billed rooms at our Canadian lodges up 35% year-over-year, (ii) new integrated services business in Canada and (iii) the impact of a stronger Australian dollar relative to the U.S. dollar in the third quarter of 2026 compared to the third quarter of 2025. These increases were partially offset by reduced occupancy at our Bowen Basin villages in Queensland. See the discussion of segment results of operations below for further information.

Previous wording

Cost of Sales and Services. Our consolidated cost of sales and services increased $17.1 million, or 14%, in the second quarter of 2026 compared to the second quarter of 2025. This increase was primarily driven by (i) new integrated services business in Queensland and Canada, including the associated overhead costs, (ii) incremental costs in Australia associated with the Qantac Acquisition in the second quarter of 2025, (iii) increased occupancy levels, higher food and service costs resulting from inflation and increased repairs and maintenance expense in Canada and (iv) a stronger Australian dollar relative to the U.S. dollar in the second quarter of 2026 compared to the second quarter of 2025. These increases were partially offset by lower costs and reduced indirect costs at certain Canadian lodges resulting from cost reduction measures implemented in early 2025. See the discussion of segment results of operations below for further information.

Current wording

Cost of Sales and Services. Our consolidated cost of sales and services increased $20.1 million, or 16%, in the third quarter of 2026 compared to the third quarter of 2025. This increase was primarily driven by (i) higher operating costs associated with increased occupancy levels, higher food and service costs resulting from inflation and increased repairs and maintenance expense in Canada, (ii) new integrated services business in Canada and (iii) the impact of a stronger Australian dollar relative to the U.S. dollar in the third quarter of 2026 compared to the third quarter of 2025. These increases were partially offset by (i) improved efficiencies at certain Canadian lodges resulting from increased occupancy, (ii) lower indirect costs at certain Canadian lodges resulting from cost reduction measures implemented in early 2025 and (iii) reduced activity at our Bowen Basin villages in Queensland. See the discussion of segment results of operations below for further information.

Previous wording

Selling, General and Administrative Expenses. Selling, general and administrative (SG&A) expenses decreased $0.1 million in the second quarter of 2026 compared to the second quarter of 2025. This decrease was primarily driven by a $3.7 million reduction in professional fees, including $3.2 million of shareholder activist related costs incurred in the second quarter of 2025. This decrease was partially offset by $1.5 million related to the resolution of a sales and occupancy tax matter, higher share-based compensation expense of $0.7 million, higher compensation expense of $0.5 million and a stronger Australian dollar relative to the U.S. dollar in the second quarter of 2026 compared to the second quarter of 2025.

Current wording

Selling, General and Administrative Expenses. Selling, general and administrative (SG&A) expenses increased $0.5 million in the third quarter of 2026 compared to the third quarter of 2025. This increase was primarily driven by the impact of a stronger Australian dollar relative to the U.S. dollar of $0.6 million, higher incentive compensation costs of $0.4 million, higher compensation expense of $0.3 million and higher rent expense of $0.3 million. These increases were partially offset by a $0.7 million decrease in professional fees, including $0.6 million of shareholder activist related costs incurred in the third quarter of 2025 and a $0.4 million decrease in share-based compensation expense.

Previous wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $1.5 million, or 8%, in the second quarter of 2026 compared to the second quarter of 2025. The decrease was primarily due to certain assets becoming fully depreciated in Canada and Australia. This decrease was partially offset by additional depreciation on property, plant and equipment acquired in the Qantac Acquisition and a stronger Australian dollar relative to the U.S. dollar in the second quarter of 2026 compared to the second quarter of 2025.

Current wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $4.3 million, or 21%, in the third quarter of 2026 compared to the third quarter of 2025. The decrease was primarily due to certain assets becoming fully depreciated in Canada and Australia. This decrease was partially offset by a stronger Australian dollar relative to the U.S. dollar in the third quarter of 2026 compared to the third quarter of 2025.

Previous wording

Operating Income (Expense). Consolidated operating income increased $2.3 million, or 82%, in the second quarter of 2026 compared to the second quarter of 2025, primarily driven by the Qantac Acquisition in Australia and lower depreciation and amortization expenses in the second quarter of 2026 compared to the second quarter of 2025.

Current wording

Operating Income. Consolidated operating income increased $6.3 million, or 91%, in the third quarter of 2026 compared to the third quarter of 2025, primarily driven by higher activity levels in Canada and lower depreciation and amortization expenses in the third quarter of 2026 compared to the third quarter of 2025.

Previous wording

Income Tax Expense. Our income tax expense for the three months ended June 30, 2026 totaled $3.5 million, or 349.7% of pretax income, compared to an income tax expense of $3.6 million, or 1222.4% of pretax income, for the three months ended June 30, 2025. Our effective tax rate for the three months ended June 30, 2026 and 2025 was impacted by Canada and the U.S. being considered loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision.

Current wording

Income Tax Expense. Our income tax expense for the three months ended September 30, 2026 totaled $3.9 million, or 42.8% of pretax income, compared to an income tax expense of $4.0 million, or 112.7% of pretax income, for the three months ended September 30, 2025. Our effective tax rate for the three months ended September 30, 2026 and 2025 was impacted by Canada and the U.S. being considered loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision.

Previous wording

Other Comprehensive Income (Loss). Other comprehensive income decreased $10.3 million in the second quarter of 2026 compared to the second quarter of 2025, 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 0.4% in the second quarter of 2026 compared to a 5% increase in the second quarter of 2025. The Canadian dollar exchange rate compared to the U.S. dollar decreased 2% in the second quarter of 2026 compared to a 5% increase in the second quarter of 2025.

Current wording

Other Comprehensive Income (Loss). Other comprehensive income increased $2.6 million in the third quarter of 2026 compared to the third quarter of 2025, 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 1.1% in the third quarter of 2026 compared to a 4% increase in the third quarter of 2025. The Canadian dollar exchange rate compared to the U.S. dollar increased 0.2% in the third quarter of 2026 compared to a 2% decrease in the third quarter of 2025.

Previous wording

Our Australian segment reported revenues in the second quarter of 2026 that were $12.8 million, or 11%, higher than the second quarter of 2025. The strengthening of the average exchange rate for the Australian dollar relative to the U.S. dollar by 10.8% in the second quarter of 2026 compared to the second quarter of 2025 resulted in a $12.2 million period-over-period increase in revenues. On a constant currency basis, the Australian segment experienced a 0.5% period-over-period increase in revenues. Excluding the impact of the strengthening Australian exchange rate, the increase in the Australian segment was driven by new integrated services business in Queensland and the Qantac Acquisition in the second quarter of 2025, partially offset by reduced occupancy at our legacy Bowen Basin villages in Queensland.

Current wording

Our Australian segment reported revenues in the third quarter of 2026 that were $5.1 million, or 4%, higher than the third quarter of 2025. The strengthening of the average exchange rate for the Australian dollar relative to the U.S. dollar by 8.0% in the third quarter of 2026 compared to the third quarter of 2025 resulted in a $9.6 million period-over-period increase in revenues. On a constant currency basis, the Australian segment experienced a 3.7% period-over-period decrease in revenues. Excluding the impact of foreign currency translation, the decrease was driven by reduced occupancy at our Bowen Basin villages in Queensland.

Previous wording

Our Australian segment gross margin as a percentage of revenues decreased to 25.0% in the second quarter of 2026 from 26.8% in the second quarter of 2025. This was primarily driven by reduced activity at our Bowen Basin villages in Queensland, reduced retail sales across our integrated services business and increased operating costs arising from the ongoing industry-wide shortages of skilled labor. The reduced segment gross margin was also due to higher relative revenue contribution from our integrated services business, which has a service-only business model and generates lower overall gross margins than our accommodation business.

Current wording

Our Australian segment gross margin as a percentage of revenues decreased to 24.6% in the third quarter of 2026 from 26.9% in the third quarter of 2025. This was primarily driven by reduced activity at our Bowen Basin villages in Queensland, reduced retail sales across our integrated services business and increased operating costs arising from the ongoing industry-wide shortages of skilled labor. The reduced segment gross margin was also due to higher relative revenue contribution from our integrated services business, which has a service-only business model and generates lower overall gross margins than our accommodation business.

Previous wording

Our Canadian segment reported revenues in the second quarter of 2026 that were $4.5 million, or 9%, higher than the second quarter of 2025. The increase in the Canadian segment was driven by higher billed rooms at our lodges, up 2% year-over-year, and a new integrated services contract in Ontario in the second quarter of 2026. Producers in the region remain focused on reducing operating costs while also prioritizing maintaining and increasing oil production, resulting in additional personnel at site.

Current wording

Our Canadian segment reported revenues in the third quarter of 2026 that were $17.6 million, or 38%, higher than the third quarter of 2025. The increase in the Canadian segment was driven by a 35% year-over-year increase in billed rooms at our lodges and the commencement of a new integrated services contract in Ontario in the second quarter of 2026. Producers in the region remain focused on reducing operating costs while also prioritizing maintaining and increasing oil production, resulting in additional personnel at site.

Previous wording

Our Canadian segment cost of sales and services increased $7.6 million, or 10%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The strengthening of the average exchange rate for the Canadian dollar relative to the U.S. dollar by 2.3% in the six months ended June 30, 2026 compared to the six months ended June 30, 2025 resulted in a $1.8 million period-over-period increase in cost of sales and services. Excluding the impact of the strengthening Canadian exchange rate, the increase in cost of sales and services was largely driven by higher costs at various lodges due to increased occupancy levels, higher food and service costs resulting from inflation, increased repairs and maintenance expense and higher costs associated with a new integrated services contract. These increases were partially offset by lower costs at certain lodges and reduced indirect costs resulting from cost reduction measures implemented in early 2025.

Current wording

Our Canadian segment cost of sales and services increased $13.5 million, or 38%, in the third quarter of 2026 compared to the third quarter of 2025. The increase was primarily driven by higher operating costs at various lodges due to increased occupancy levels, higher food and service costs resulting from inflation, increased repairs and maintenance expense and startup costs associated with the new integrated services contract. These increases were partially offset by improved efficiencies at certain lodges from increased occupancy and lower indirect costs resulting from cost reduction measures implemented in early 2025.

Previous wording

Our Canadian segment gross margin as a percentage of revenues decreased from 22.0% in the second quarter of 2025 to 18.9% in the second quarter of 2026. This was primarily driven by increased startup costs associated with a new integrated services contract, higher inflation and increased repairs and maintenance expense, partially offset by efficiencies while operating with increased occupancy levels.

Current wording

Our Canadian segment gross margin as a percentage of revenues increased from 22.5% in the third quarter of 2025 to 22.7% in the third quarter of 2026. This was primarily driven by efficiencies while operating with increased occupancy levels, partially offset by increased startup costs associated with a new integrated services contract, higher inflation and increased repairs and maintenance expense.

Previous wording

We reported net loss attributable to Civeo for the six months ended June 30, 2026 of $6.3 million, or $0.57 per diluted share. Net loss included $1.5 million related to the resolution of a sales and occupancy tax matter, $1.0 million in severance, $0.6 million related to real estate rationalization efforts in Canada and $0.5 million of shareholder activist related costs.

Current wording

We reported net loss attributable to Civeo for the nine months ended September 30, 2026 of $1.2 million, or $0.11 per diluted share. Net loss included $1.5 million related to the resolution of a sales and occupancy tax matter, $1.4 million in severance, $0.6 million related to real estate rationalization efforts in Canada and $0.5 million of shareholder activist related costs.

Previous wording

We reported net loss attributable to Civeo for the six months ended June 30, 2025 of $13.2 million, or $0.98 per diluted share. Net loss included $3.2 million of shareholder activist related costs and $1.4 million of cost saving initiatives in Canada related to severance and two lodge closures.

Current wording

We reported net loss attributable to Civeo for the nine months ended September 30, 2025 of $13.6 million, or $1.04 per diluted share. Net loss included $3.8 million of shareholder activist related costs and $1.7 million of cost saving initiatives in Canada related to severance, two lodge closures and other real estate rationalization efforts.

Previous wording

Revenues. Consolidated revenues increased $45.9 million, or 15%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by (i) new integrated services business in Queensland and Canada, (ii) contributions in Australia from the Qantac Acquisition in the second quarter of 2025, (iii) higher billed rooms at our owned lodges in Canada and (iv) a stronger Australian and Canadian dollar relative to the U.S. dollar in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. These increases were partially offset by reduced occupancy at our legacy Bowen Basin villages in Queensland. See the discussion of segment results of operations below for further information.

Current wording

Revenues. Consolidated revenues increased $68.6 million, or 14%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. This increase was primarily driven by (i) new integrated services business in Queensland, Western Australia and Canada, (ii) contributions in Australia from the Qantac Acquisition completed in the second quarter of 2025, (iii) higher billed rooms at our owned lodges in Canada and (iv) the impact of a stronger Australian and Canadian dollar relative to the U.S. dollar in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. These increases were partially offset by reduced occupancy at our legacy Bowen Basin villages in Queensland. See the discussion of segment results of operations below for further information.

Previous wording

Cost of Sales and Services. Our consolidated cost of sales and services increased $35.0 million, or 15%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by (i) new integrated services business in Queensland and Canada, including the associated overhead costs, (ii) incremental costs in Australia associated with the Qantac Acquisition in the second quarter of 2025, (iii) increased occupancy levels, higher food and service costs resulting from inflation and increased repairs and maintenance expense in Canada and (iv) a stronger Australian and Canadian dollar relative to the U.S. dollar in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. These items were partially offset by lower costs at certain Canadian lodges and reduced indirect costs resulting from cost reduction measures implemented in early 2025. See the discussion of segment results of operations below for further information.

Current wording

Cost of Sales and Services. Our consolidated cost of sales and services increased $55.1 million, or 15%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. This increase was primarily driven by (i) new integrated services business in Queensland, Western Australia and Canada, including the associated overhead costs, (ii) incremental costs in Australia associated with the Qantac Acquisition in the second quarter of 2025, (iii) higher operating costs resulting from increased occupancy levels, higher food and service costs due to inflation and increased repairs and maintenance expense in Canada and (iv) the impact of a stronger Australian and Canadian dollar relative to the U.S. dollar in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. These items were partially offset by improved efficiencies and lower costs at certain Canadian lodges and reduced indirect costs resulting from cost reduction measures implemented in early 2025. See the discussion of segment results of operations below for further information.

Previous wording

Selling, General and Administrative Expenses. Selling, general and administrative (SG&A) expenses increased $1.8 million, or 5%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by $1.5 million related to the resolution of a sales and occupancy tax matter, higher compensation expense of $1.2 million, largely due to severance costs incurred in Canada, the write-off of accounts receivable in Australia due to customer insolvency of $0.8 million, higher share-based compensation expense of $0.7 million and a stronger Australian and Canadian dollar relative to the U.S. dollar in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. These increases were partially offset by a $3.7 million reduction in professional fees, including $3.2 million of shareholder activist related costs incurred in the six months ended June 30, 2025.

Current wording

Selling, General and Administrative Expenses. SG&A expenses increased $2.3 million, or 4%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. This increase was primarily driven by the impact of a stronger Australian dollar relative to the U.S. dollar of $2.4 million, $1.5 million related to the resolution of a sales and occupancy tax matter, higher compensation expense of $1.5 million, primarily due to severance costs incurred in Canada, a $0.8 million write-off of accounts receivable in Australia resulting from a customer insolvency and higher incentive compensation costs of $0.8 million. These increases were partially offset by a $4.4 million decrease in professional fees, including $3.8 million of shareholder activist related costs incurred in the nine months ended September 30, 2025.

Previous wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $0.4 million, or 1%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The decrease was primarily due to certain assets becoming fully depreciated in Canada and Australia. This decrease was partially offset by additional depreciation on property, plant and equipment acquired in the Qantac Acquisition and a stronger Australian and Canadian dollar relative to the U.S. dollar in the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Current wording

Depreciation and Amortization Expense. Depreciation and amortization expense decreased $4.7 million, or 9%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The decrease was primarily due to certain assets becoming fully depreciated in Canada and Australia. This decrease was partially offset by additional depreciation on property, plant and equipment acquired in the Qantac Acquisition and a stronger Australian and Canadian dollar relative to the U.S. dollar in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025.

Previous wording

Operating Income (Expense). Consolidated operating income increased $10.9 million, or 402%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily driven by the Qantac Acquisition in Australia, higher activity levels in Canada and gross margin expansion in Canada resulting from cost cutting measures previously implemented.

Current wording

Operating Income. Consolidated operating income increased $17.3 million, or 406%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily driven by higher activity levels in Canada and gross margin expansion in Canada resulting from cost cutting measures previously implemented, the Qantac Acquisition in Australia and lower depreciation and amortization expenses.

Previous wording

Interest Expense, net. Net interest expense increased by $3.7 million, or 88%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily related to higher average debt levels, as a result of the Qantac Acquisition and increased share repurchases during 2025.

Current wording

Interest Expense, net. Net interest expense increased by $4.5 million, or 60%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily related to higher average debt levels, as a result of the Qantac Acquisition and increased share repurchases and higher interest rates on Australian credit facility borrowings. These increases were partially offset by lower interest rates associated with the Convertible Notes.

Previous wording

Income Tax Expense. Our income tax expense for the six months ended June 30, 2026 totaled $6.7 million, or 1926.6% of pretax income, compared to an income tax expense of $6.7 million or (103.5)% of pretax loss, for the six months ended June 30, 2025. Our effective tax rate for the six months ended June 30, 2026 and 2025 was impacted by Canada and the U.S. being considered loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision.

Current wording

Income Tax Expense. Our income tax expense for the nine months ended September 30, 2026 totaled $10.5 million, or 112.1% of pretax income, compared to an income tax expense of $10.7 million or (372.0)% of pretax loss, for the nine months ended September 30, 2025. Our effective tax rate for the nine months ended September 30, 2026 and 2025 was impacted by Canada and the U.S. being considered loss jurisdictions that were removed from the annual effective tax rate computation for purposes of computing the interim tax provision.

Previous wording

Other Comprehensive Income (Loss). Other comprehensive income decreased $6.5 million in the six months ended June 30, 2026 compared to the six months ended June 30, 2025, 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 4% in the six months ended June 30, 2026 compared to a 6% increase in the six months ended June 30, 2025. The Canadian dollar exchange rate compared to the U.S. dollar decreased 4% in the six months ended June 30, 2026 compared to a 5% increase in the six months ended June 30, 2025.

Current wording

Other Comprehensive Income (Loss). Other comprehensive income decreased $4.0 million in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, 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 5% in the nine months ended September 30, 2026 compared to a 6% increase in the nine months ended September 30, 2025. The Canadian dollar exchange rate compared to the U.S. dollar decreased 3% in the nine months ended September 30, 2026 compared to a 3% increase in the nine months ended September 30, 2025.

Previous wording

Our Australian segment reported revenues in the six months ended June 30, 2026 that were $32.1 million, or 15%, higher than the six months ended June 30, 2025. The strengthening of the average exchange rate for the Australian dollar relative to the U.S. dollar by 10.9% in the six months ended June 30, 2026 compared to the six months ended June 30, 2025 resulted in a $24.2 million period-over-period increase in revenues. On a constant currency basis, the Australian segment experienced a 3.7% period-over-period increase in revenues. Excluding the impact of the strengthening Australian exchange rate, the increase in the Australian segment was driven by the new integrated services business in Queensland and the Qantac Acquisition in the second quarter of 2025, partially offset by reduced occupancy at our legacy Bowen Basin villages in Queensland.

Current wording

Our Australian segment reported revenues in the nine months ended September 30, 2026 that were $37.2 million, or 11%, higher than the nine months ended September 30, 2025. The strengthening of the average exchange rate for the Australian dollar relative to the U.S. dollar by 9.9% in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 resulted in a $33.9 million period-over-period increase in revenues. On a constant currency basis, the Australian segment experienced a 1.1% period-over-period increase in revenues. Excluding the impact of foreign currency translation, the increase was driven by the new integrated services business in Queensland and Western Australia and the Qantac Acquisition in the second quarter of 2025. These items were partially offset by reduced occupancy at our legacy Bowen Basin villages in Queensland.

Previous wording

Our Australian segment cost of sales and services increased $27.4 million, or 17%, in the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The strengthening of the average exchange rate for the Australian dollar relative to the U.S. dollar by 10.9% in the six months ended June 30, 2026 compared to the six months ended June 30, 2025 resulted in a $18.2 million period-over-period increase in cost of sales and services. Excluding the impact of the strengthening Australian exchange rate, the increase in cost of sales and services in the Australian segment was largely driven by the Qantac Acquisition and new integrated services business in Queensland, including the associated overhead costs.

Current wording

Our Australian segment cost of sales and services increased $34.0 million, or 14%, in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The strengthening of the average exchange rate for the Australian dollar relative to the U.S. dollar by 9.9% in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 resulted in a $25.5 million period-over-period increase in cost of sales and services. Excluding the impact of foreign currency translation, the increase in cost of sales and services was primarily driven by the Qantac Acquisition and new integrated services business in Queensland and Western Australia, including the associated overhead costs.