About Oceaneering International

Oceaneering International, Inc. (Oceaneering) is a global technology company. The company is delivering engineered services and products and robotic solutions to the offshore energy, defense, aerospace, manufacturing and entertainment industries. The company is one of the world's largest underwater services contractors. The services and products the company provides to the energy industry include remotely operated vehicles, survey and positioning services, specialty subsea hardware, engineering and project management, subsea intervention services, including manned diving and asset integrity and non-destructive testing services. The company's foreign operations, principally in Africa, Asia and Australia, the United Kingdom, Brazil, and Norway accounted for approximately 58% of its revenue. The company's business segments are contained within two businesses-services and products provided primarily to the oil and gas industry, and to a lesser extent, the mobility solutions and offshore renewables industries, among others (Energy), and services and products provided to non-energy industries (Aerospace and Defense Technologies). The company's four business segments within the Energy business are Subsea Robotics, Manufactured Products, Offshore Projects Group and Integrity Management & Digital Solutions. The company reports its Aerospace and Defense Technologies business as one segment. Energy: The company's efforts in its Energy business have always focused on efficiency and safety, which in turn has led to environmental and other benefits, including assisting its customers to reduce their carbon emissions in exploring for, developing and producing oil and natural gas and in addressing the ongoing energy transition. The company also focuses on opportunities to develop and deploy its capabilities to grow business in mobile robotics, offshore wind installations (both fixed and floating), nuclear, hydrogen and carbon-capture-and-sequestration (CCS) markets and tidal energy solutions, as well as expanding its asset integrity management and digital solutions for those markets. Subsea Robotics: The company's Subsea Robotics segment consists of its remotely operated vehicles (ROVs), survey services and ROV tooling businesses. The company provides ROVs, which are tethered submersible vehicles remotely operated from the surface, to customers in the offshore energy industry for drill support and vessel-based services, including subsea hardware installation, construction, pipeline inspection, survey and facilities inspection, maintenance and repair (IMR). The company designs, builds, retrofits and upgrades its new and existing ROVs at in-house facilities, the largest of which is in Morgan City, Louisiana. The company's work-class ROV fleet size was 250 as of December 31, 2023, and included six Isurus work-class ROV systems (which are capable of operating in high-current conditions and are ideal for renewables projects and high-speed surveys) its battery-operated Liberty electric ROV (E-ROV) system, which it developed to address customer objectives regarding cost efficiencies, safety, personnel shortages and environmental considerations. The E-ROV system allows the company's customers to reduce carbon dioxide and other greenhouse gas (GHG) emissions associated with offshore production operations. Additionally, the company's newest development is Freedom, a hybrid autonomous underwater vehicle (AUV) and ROV that can complete surveys, commissioning, inspections, maintenance, and repairs without the need for a pilot to monitor and control the entire operation. The company intends to continue to expand its remote service offerings in this segment given the potentially significant savings both financially and in CO2 emissions available from the Liberty and the Isurus systems and other E-ROV and hybrid systems it is developing. Manufactured Products: The company's Manufactured Products segment provides distribution systems, such as production control umbilicals and connection systems made up of specialty subsea hardware, along with clamp connectors and subsea and topside control valves. The company also provides turnkey solutions that include project management, engineering design, fabrication/assembly and installation of autonomous mobile robotic technology to industrial, manufacturing, healthcare, warehousing and commercial theme park markets. The company provides various types of subsea umbilicals through its Umbilical Solutions division from plants in the United States, Scotland and Brazil. Offshore operators use umbilicals to control subsea wellhead hydrocarbon flow rates, monitor downhole and wellhead conditions and perform chemical injection. Subsea umbilicals are also used to provide power and fluids to other subsea processing hardware, including pumps and gas separation equipment. Offshore Projects Group: The company's Offshore Projects Group (OPG) segment provides a broad portfolio of integrated subsea project capabilities and solutions as follows: subsea installation and intervention, including riserless light well intervention (RLWI) services, IMR services, principally in the United States (U.S.) Gulf of Mexico and offshore Angola, utilizing owned and chartered vessels; installation and workover control systems (IWOCS) and ROV workover control systems (RWOCS); diving services; decommissioning services; project management and engineering; and drill pipe riser services and systems and wellhead load relief solutions. The company's OPG segment provides vessel-based services principally in the U.S. Gulf of Mexico and offshore Angola, utilizing a fleet consisting of three owned and six chartered dynamically positioned deepwater vessels with integrated high-specification work-class ROVs onboard, and one owned survey vessel, other spot-chartered vessels and other assets. The company's owned vessels are Jones Act-compliant. The dynamically positioned vessels are equipped with thrusters that allow them to maintain a constant position at a location without the use of anchors. They are used in the IMR of subsea facilities, pipeline or flowline tie-ins, pipeline crossings and installations. These vessels can also carry and install equipment or umbilicals required to bring subsea well completions into production (tie-back to production facilities). Integrity Management & Digital Solutions: The company's Integrity Management & Digital Solutions (IMDS) segment provides asset integrity management, corrosion management, inspection and nondestructive testing services, principally to customers in the oil and gas, power generation and petrochemical industries. The company performs these services on both onshore and offshore facilities, both topside and subsea. The company also provides software, digital and connectivity solutions for the energy industry and software and analytical solutions for the maritime industry. Aerospace and Defense Technologies: The company's Aerospace and Defense Technologies (ADTech) segment provides government services and products, including engineering and related manufacturing in defense and space exploration activities, principally to U.S. government agencies and their prime contractors. Many of the services and products utilized in ADTech are applied technologies based on the company's core competencies and knowledge derived from decades of working in the offshore markets and solving complex problems in harsh environments. The company intends to continue its strategy of acquiring, as opportunities arise, additional assets or businesses, to improve its market position or expand into related service and product lines. The company will continue to develop and deliver technologies to help its customers produce hydrocarbons in a cleaner, safer and more cost-effective manner while increasing its investments into new markets including energy transition, mobility solutions, digital asset management, and aerospace and defense solutions. Energy The company's Energy business consists of the Subsea Robotics, Manufactured Products, Offshore Projects Group and Integrity Management & Digital Solutions segments. Subsea Robotics: ROVs are tethered submersible vehicles remotely operated from the surface. The company uses its ROVs in the offshore energy industry to perform a variety of underwater tasks, including drill support, vessel-based IMR, installation and construction support, pipeline inspection and surveys, and subsea production facility operation and maintenance. Work-class ROVs are outfitted with manipulators, sonar and video cameras, and can operate specialized tooling packages and other equipment or features to facilitate the performance of specific underwater tasks. As of December 31, 2023, the company owned 250 work-class ROVs. The company owns and operates the largest fleet of work-class ROVs in the world. The company provides ROV services for offshore drill support, with an estimated 61% market share of the contracted floating drilling rigs at the end of 2023. The company provides survey services, including hydrographic survey and positioning services and autonomous underwater vehicles for geoscience. Manufactured Products: The company provides advanced technology product development, manufacturing and project management to industrial, manufacturing, healthcare, warehousing and commercial theme park markets. These include various types of subsea umbilicals utilizing steel tubes, thermoplastic hoses, and power and communication cables, along with termination assemblies; production control equipment; clamp connectors; pipeline connector and repair systems; subsea and topside control valves; subsea chemical injection valves; and autonomous mobile robotic technology, including entertainment systems for theme parks. Offshore well operators use subsea umbilicals and production control equipment to control subsea wellhead hydrocarbon flow, monitor downhole and wellhead conditions and perform chemical injection. They are also used to provide power and fluids to other subsea processing hardware, including pumps and gas/oil separation equipment. The company also provides mobile robotics solutions, including autonomous mobile robot technology, and turnkey solutions that include program management, engineering design, fabrication/assembly and installation utilizing its autonomous mobile robotic technology, to a variety of industries. Offshore Projects Group: The company provides subsea hardware installation, intervention and IMR services for the offshore energy markets. The company performs subsea IMR, intervention and hardware installation services, primarily in the U.S. Gulf of Mexico and offshore Angola from multiservice vessels that typically have Oceaneering ROVs, survey and positioning services onboard. The company's services include subsea well tie-backs; pipeline/flowline tie-ins and repairs; pipeline crossings; umbilical and other subsea equipment installations; subsea interventions; and IMR activities. The company also provides drill pipe riser services and systems and wellhead load relief solutions. The company provides RLWI services to support subsea well intervention projects and subsea work packages that facilitate hydrate remediation and well stimulation solutions. The company also provides IWOCS and RWOCS that support completions, tree installation, workovers, intervention, and decommissioning operations. The company provides services for shallow-water projects (depths less than 1,000 feet) primarily in the U.S. Gulf of Mexico and offshore Angola with manned diving operations utilizing the traditional diving techniques of air, mixed gas and saturation diving, all of which use surface-supplied breathing gas. The company supplies diving services from offshore facilities and chartered vessels. Integrity Management & Digital Solutions: The company offers a wide range of asset integrity services to customers worldwide to help ensure the safety of their facilities onshore and offshore. The company also provides third-party inspections to satisfy contractual structural specifications, internal safety standards or regulatory requirements. The company provides these services principally to customers in the oil and gas, petrochemical and power generation industries. In the United Kingdom (U.K.), the company provides Independent Inspection Authority services for the oil and gas industry, which include first-pass integrity evaluation and assessment and nondestructive testing services. The company uses a variety of technologies to perform pipeline inspections, both onshore and offshore. In its digital services, the company focuses on maritime and energy software offerings and forming key partnerships to expand its capabilities and market reach. Aerospace and Defense Technologies: The company provides engineering services and manufacturing to the U.S. Department of Defense, National Aeronautics and Space Administration (NASA) and major government contractors. The company works with its customers to understand their specialized requirements, identify and mitigate risks, and provide them value-added, maintainable, safe and certified solutions. The segment's largest customer is the U.S. Government with the U.S. Navy and NASA being the primary agencies supported. For the U.S. Navy, the company performs engineering services, prototype design building services and repair and maintenance services on submarines and surface ships. The company supports space exploration and technology development by providing its products and services to NASA, aerospace contractors and commercial space companies. The company's U.S. Navy and NASA-related activities substantially depend on continued government funding. Marketing Energy: The company markets its Subsea Robotics, Manufactured Products, OPG and IMDS services and products to domestic, international and foreign national energy companies engaged in offshore exploration, development and production. The company also provides services and products as a subcontractor to other oilfield service companies operating as prime contractors. In addition, the company markets its Manufactured Products mobile robotic solutions to domestic and international industrial, manufacturing, healthcare, warehousing and commercial theme park industries. Customers for the company's energy services and products typically award contracts on a competitive-bid basis. These contracts can range from less than one year in duration to multi-year contracts. In connection with the services the company performs in its Energy business, it generally seeks contracts that compensate it on a dayrate basis. Under dayrate contracts, the contractor provides the ROV, vessel or equipment and the required personnel to operate the unit and compensation is based on a rate per day for each day the unit is used. The typical dayrate depends on market conditions, the nature of the operations to be performed, the duration of the work, the equipment and services to be provided, the geographical areas involved and other variables. Dayrate contracts may also contain an alternate, lower dayrate that applies when a unit is moving to a new site or when operations are interrupted or restricted by equipment breakdowns, adverse weather or water conditions or other conditions beyond the contractor's control. Aerospace and Defense Technologies: The company markets its engineered products and services primarily to the U.S. government agencies and their prime contractors in defense and space exploration activities, as well as commercial space companies. Major Customers: The company's top five customers in 2023, accounted for 36% of its consolidated revenue. In 2023, four of the company's top five customers were oil and gas exploration and production companies served by its Energy business segments, with the other one being the U.S. Government, which is served by its ADTech segment. During 2023, revenue from one customer, the U.S. Government, accounted for 10% of the company's total consolidated annual revenue. Seasonality The company generates a material amount of its consolidated revenue from contracts for services in the U.S. Gulf of Mexico in its OPG segment, which is usually more active in the second and third quarters, as compared to the rest of the year. The European operations of the company's IMDS segment are also seasonally more active in the second and third quarters. Revenue in the company's Subsea Robotics segment is subject to seasonal variations in demand, with its first quarter generally being the low quarter of the year (year ended December 31, 2023). The level of the company's Subsea Robotics seasonality depends on the number of ROVs it has engaged in vessel-based subsea infrastructure IMR and installation, which is more seasonal than drill support. Regulation Environmental laws and regulations that apply to the company's operations include the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act (each, as amended) and similar laws that provide for responses to, and liability for, releases of hazardous substances into the environment. The company's operations are also governed by laws and regulations relating to workplace safety and worker health, primarily, in the United States, the Occupational Safety and Health Act and regulations promulgated thereunder. The company's quality management systems are registered as being in conformance with ISO 9001:2015 and cover: its Subsea Robotics operations in the U.S. Gulf of Mexico, the U.K., Norway, Angola, Ghana, Brazil, Canada, India, the United Arab Emirates, Australia, Azerbaijan, Indonesia and Malaysia; its Manufactured Products operations in Brazil, Canada, the U.S., the U.K., Norway, Malaysia, the Netherlands and Germany; its Offshore Projects Group operations in the U.S. Gulf of Mexico, the U.K., Norway, Angola, Ghana, Brazil, Canada, India, the United Arab Emirates, Australia, Azerbaijan, Indonesia, Singapore, Thailand and Malaysia; its Integrity Management & Digital Solutions operations in the U.S. Gulf of Mexico, the U.K., Norway, Angola, the United Arab Emirates, Oman, Qatar, Australia, Malaysia, Indonesia and Azerbaijan; and the Oceaneering Space Systems, Oceaneering Technologies and Marine Services divisions of its Aerospace and Defense Technologies segment in the U.S. History Oceaneering International, Inc. was founded in 1964. The company was incorporated in 1969.