Civeo Reports Mixed Q1 2025 Results with Canadian Weakness Offset by Australian Growth and Strategic Acquisition

Civeo Corporation reported first-quarter 2025 financial results that highlighted contrasting performance across its geographic segments, with Canadian operations facing substantial headwinds while Australian operations demonstrated robust growth. The company's consolidated revenue of $144.0 million fell short of analyst expectations, primarily driven by weakness in the Canadian market segment where revenues declined 40% year-over-year to $40.4 million. This downturn was attributed to reduced customer spending in the oil sands region and the loss of Fort Hills-related occupancy, prompting aggressive cost-cutting measures including a 25% reduction in Canadian headcount and the cold-shuttering of two lodges.

In stark contrast, the Australian segment posted a 13% year-over-year revenue growth to $103.6 million, benefiting from increased integrated services activity under a six-year, A$1.4 billion contract and maintaining stable adjusted EBITDA of $20.5 million. The company's strategic positioning in Australia was further strengthened on May 7, 2025, with the closing of an acquisition of four villages in the Australian Bowen Basin that is immediately accretive and expected to add approximately $32.0 million in revenue and $17.0 million in EBITDA. This acquisition establishes Civeo's presence in the Blackwater region and provides contract coverage with met coal producers, representing a significant expansion of the company's Australian footprint.

Following this strategic acquisition, Civeo revised its full-year 2025 guidance upward, now projecting revenue between $640 million and $670 million with adjusted EBITDA ranging from $86 million to $96 million. Capital expenditure guidance remains consistent at $20 million to $25 million, reflecting the company's disciplined approach to capital deployment despite the challenging market conditions in Canada. Financial analysts at Stonegate Capital Partners conducted a valuation analysis using discounted cash flow and enterprise value to EBITDA comparative methods, suggesting a valuation range between $29.03 and $37.91 per share with midpoint estimates of $30.53 and $34.49 respectively. The quarter underscores Civeo's strategic balancing act between navigating difficult market conditions in the Canadian energy sector while simultaneously expanding and strengthening its position in the more resilient Australian market through targeted acquisitions and operational excellence.