Tidewater Inc: Form 10-Q for the period ended Sep 30, 2025

Forward-Looking Statements

Certain of the statements included in this Form 10-Q constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, which includes any statements that are not historical facts. Such statements often contain words such as “expect,” “believe,” “think,” “anticipate,” “predict,” “plan,” “assume,” “estimate,” “forecast,” “goal,” “target,” “projections,” “intend,” “should,” “will,” “shall” and other similar words. Forward-looking statements are made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Tidewater Inc. and its subsidiaries. There can be no assurance that future developments affecting Tidewater Inc. and its subsidiaries will be those anticipated by management. These forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements, including, among others: fluctuations in worldwide energy demand and oil and natural gas prices; fluctuations in macroeconomic and market conditions (including risks related to recession, inflation, supply chain constraints or disruptions, interest rates, and exchange rates); global trade trends, including evolving impacts from implementation of new tariffs and potential retaliatory measures; industry overcapacity; limited capital resources available to replenish our asset base as needed, including through acquisitions or vessel construction, and to fund our capital expenditure needs; uncertainty of global financial market conditions and potential constraints in accessing capital or credit if and when needed with favorable terms, if at all; changes in decisions and capital spending by customers in the energy industry and the industry expectations for offshore exploration, field development and production; consolidation of our customer base; loss of a major customer; changing customer demands for vessel specifications, which may make some of our older vessels technologically obsolete for certain customer projects or in certain markets; rapid technological changes; delays and other problems associated with vessel maintenance; the continued availability of qualified personnel and our ability to attract and retain them; the operating risks normally incident to our lines of business, including the potential impact of liquidated counterparties; our ability to comply with covenants in our indentures and other debt instruments; acts of terrorism and piracy; the impact of regional or global public health crises or pandemics; the impact of potential information technology, cybersecurity or data security breaches; uncertainty around the use and impacts of artificial intelligence (AI) applications; integration of acquired businesses and entry into new lines of business; disagreements with our joint venture partners; natural disasters or significant weather conditions; unsettled political conditions, war, civil unrest and governmental actions, such as expropriation or enforcement of customs or other laws that are not well developed or consistently enforced; the risks associated with our international operations, including local content, local currency or similar requirements especially in higher political risk countries where we operate; interest rate and foreign currency fluctuations; labor changes proposed by international conventions; increased regulatory burdens and oversight; changes in laws governing the taxation of foreign source income; retention of skilled workers; our participation in industry wide, multi-employer, defined pension plans; enforcement of laws related to the environment, labor and foreign corrupt practices; increased global concern, regulation and scrutiny regarding climate change; increased stockholder activism; the potential liability for remedial actions or assessments under existing or future environmental regulations or litigation; the effects of asserted and unasserted claims and the extent of available insurance coverage; the resolution of pending legal proceedings; and other risks and uncertainties detailed in this Quarterly Report on Form 10-Q (Form 10-Q) and other filings we make with the SEC. If one or more of these or other risks or uncertainties materialize (or the consequences of any such development changes), or should our underlying assumptions prove incorrect, actual results or outcomes may vary materially from those reflected in our forward-looking statements. Forward-looking and other statements in this Form 10-Q regarding our environmental, social and other sustainability plans, goals or activities are not an indication that these statements are necessarily material to investors or required to be disclosed in our filings with the SEC. In addition, historical, current, and forward-looking environmental, social and sustainability-related statements may be based on standards still developing, internal controls and processes that will continue to evolve, and assumptions subject to change in the future. Statements in this Form 10-Q are made as of the date of this filing, and Tidewater disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise. In addition, see “Risk Factors” included in our Annual Report on Form 10-K, filed with the SEC on February 27. 2025 (2024 Annual Report) and in this Form 10-Q for a discussion of certain risks relating to our business and investment in our securities.

In certain places in this Form 10-Q, we may refer to reports published by third parties that purport to describe trends or developments in energy production and drilling and exploration and we specifically disclaim any responsibility for the accuracy and completeness of such information and have undertaken no steps to update or independently verify such information.

The forward-looking statements should be considered in the context of the risk factors listed above, discussed in this Form 10-Q, and discussed in our 2024 Annual Report as updated by subsequent filings with the SEC. Investors and prospective investors are cautioned not to rely unduly on such forward-looking statements, which speak only as of the date hereof. Management disclaims any obligation to update or revise any forward-looking statements contained herein to reflect new information, future events, or developments.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related notes thereto included in “Item 1. Financial Statements” and with our 2024 Annual Report. The following discussion and analysis contain forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under “Risk Factors” in Item 1A of our 2024 Annual Report and elsewhere in this Form-10Q.

EXECUTIVE SUMMARY AND CURRENT BUSINESS OUTLOOK

Tidewater

We are one of the most experienced international operators in the offshore energy industry with a history spanning over 65 years. Our vessels and associated services support all phases of offshore crude oil and natural gas (also referred to as oil and gas) exploration activities, field development, production and maintenance, as well as windfarm development and maintenance. Our services include towing of, and anchor handling for, mobile offshore drilling units; transporting supplies and personnel necessary to sustain drilling, workovers, production activities, supporting field abandonment, dismantlement and restoration activities; offshore construction and seismic and subsea support; geotechnical survey support for windfarm construction; and a variety of other specialized services such as pipe and cable laying. In addition, we have one of the broadest geographic operating footprints in the offshore vessel industry. Our global operating footprint allows us to react quickly to changing local market conditions and to be responsive to the changing requirements of the many customers with which we believe we have strong relationships.

At September 30, 2025, we owned 209 vessels with an average age of 13.0 years available to serve the global offshore energy industry.

MD&A Objective and Principal Factors That Drive Our Results, Cash Flows and Liquidity

Our MD&A is designed to provide information about our financial condition and results of operations from management’s perspective.

Our revenues, net earnings and cash flows from operations are largely dependent upon the activity level of our offshore marine vessel fleet. Our business activity is largely dependent on the level of exploration, field development and production activity of our customers. Our customers’ business activity, in turn, is dependent on current and expected crude oil and natural gas prices, which fluctuate depending on expected future levels of supply and demand for crude oil and natural gas, and on estimates of the cost to find, develop and produce crude oil and natural gas reserves. Our objective throughout the MD&A is to discuss how these factors affected our historical results and where applicable, how we expect these factors to impact our future results and future liquidity.

Our revenues in all segments are driven primarily by our active fleet size, active vessel utilization and day rates. Because a sizeable portion of our operating and depreciation costs do not change proportionally with changes in revenue, our operating profit is largely dependent on revenue levels.

Operating costs consist primarily of crew costs; repair and maintenance costs; insurance costs; fuel, lube oil and supplies costs; and other vessel operating costs. Fleet size, fleet composition, geographic areas of operation, supply and demand for marine personnel, and local labor requirements are the major factors impacting overall crew costs in all segments. In addition, our newer, more technologically sophisticated vessels generally require a greater number of specially trained, more highly compensated fleet personnel than our older, smaller and less sophisticated vessels. Crew costs may increase if competition for skilled personnel intensifies.

Costs related to the recertification of vessels are deferred and amortized over 30 months on a straight-line basis. Maintenance costs incurred at the time of the recertification drydocking not related to the recertification of the vessel are expensed as incurred. Costs related to vessel improvements that either extend the vessel’s useful life or increase the vessel’s functionality are capitalized and depreciated.

Insurance costs are dependent on a variety of factors, including our safety record and pricing in the insurance markets, and can fluctuate over time. Our vessels are generally insured for up to their estimated fair market value in order to cover damage or loss. We also purchase coverage for potential liabilities stemming from third-party losses and cyber security breaches with limits that we believe are reasonable for our business and operations, but do not generally purchase business interruption insurance or similar coverage. During the past three years, we have not incurred any material costs, fines or penalties due to a direct or third-party vendor cybersecurity breach. Insurance limits are reviewed annually, and third-party coverage is purchased based on the expected scope of ongoing operations and the cost of third-party coverage.

Fuel and lube costs can fluctuate in any given period depending on the number and distance of vessel mobilizations, the number of active vessels off-hire, drydockings, and changes in fuel prices. Generally, our customers are responsible for fuel costs when our vessels are on-hire, and we are responsible for fuel costs when our vessels are off-hire or in drydock. We also incur vessel operating costs aggregated as “other” vessel operating costs. These costs consist of brokers’ commissions, training costs, satellite communication fees, agent fees, port fees, freight and other miscellaneous costs. Brokers’ commissions are incurred primarily in our non-U.S. operations where brokers sometimes assist in obtaining work. Brokers generally are paid a percentage of day rates and, accordingly, commissions paid to brokers generally fluctuate in accordance with vessel revenue.

We discuss our liquidity in terms of cash flow that we generate from our operations. Our primary sources of capital have been our cash on hand, internally generated funds including operating cash flow, vessel sales and long-term debt financing. From time to time, we also issue stock or stock-based financial instruments either in the open market or as currency in acquisitions. This ability is impacted by existing market conditions.

Industry Conditions and Outlook

Our business is exposed to numerous macro factors that influence our outlook and expectations. Our outlook and expectations described herein are based solely on the market as we see it today, and therefore, subject to various changing conditions that impact the oil and gas industry.

Our outlook is largely driven by expectations for the worldwide demand for hydrocarbons, and expectations surrounding the demand for and the global supply of vessels that support the offshore energy industry. Our business is directly impacted by the level of activity in worldwide offshore oil and gas exploration, development and production, which in turn is influenced by trends in oil and gas prices and the condition of the energy markets, and in particular, the willingness of energy companies to spend on offshore operational activities and capital projects. This activity includes demand for floating drilling rigs, which also directly impacts our industry.

Oil and gas prices are affected by a host of geopolitical and economic forces, including the fundamental principles of supply and demand. Offshore oil and gas exploration and development activities often require higher oil or gas prices to justify the higher expenditure levels of offshore activities compared to conventional onshore activities. Prices are subject to significant uncertainty and, as a result, are extremely volatile. Over the past several years, oil and gas commodity pricing and the overall supply of and demand for oil and gas have been affected by (i) a global pandemic, which included lock downs by major oil consuming nations; (ii) an ongoing war in eastern Europe between Russia and Ukraine, which includes sanctions on Russian oil production; (iii) an Israeli/Palestinian conflict that has resulted in increased disruption of shipping in the Middle East; (iv) Organization of Petroleum Exporting Countries Plus (OPEC+) production quotas, market share expectations and pricing considerations; (v) resource growth in non-OPEC+ nations; (vi) a capital allocation focus on returning capital to shareholders within the major oil and gas companies, thereby limiting funds previously available for resource development; (vii) economies of and monetary policies in major consuming nations; (viii) increased activism related to the perceived responsibility of the oil and gas sector for climate change; and (ix) more recently, U.S. trade policies that include substantial tariffs, causing increased market uncertainty and volatility. These factors, as well as numerous other regional conflicts in producing regions, have at various times caused or exacerbated significant swings in oil and gas pricing, which in turn has affected the capital budgets of oil and gas companies. Despite the volatility in spot oil prices seen in recent years, our customers tend to consider less volatile medium and long-term prices in making offshore investment decisions. In the medium term, we continue to see positive upstream investment momentum in both the international and domestic markets. We believe these markets are driven by resilient long-cycle offshore developments, production capacity expansions and increased resource exploitation activities. We have experienced a sustained period of growth in offshore exploration and production in the past few years, which has been accompanied by much higher levels of activity and higher day rates for our vessels.

Multiple events during this year have introduced additional uncertainty to both the global economy and our business, including OPEC+ actions, tariffs, and regional conflicts. Determining the long-term impact of these events on our business and the industry continues to be challenging. Offshore drilling projects are typically long-cycle and do not immediately react to moderate increases or declines in oil and gas prices. However, sustained oil prices in the low $60s per barrel, may delay some drilling projects initially expected to commence in late 2025 and early 2026.

RESULTS OF OPERATIONS

Each of our five operating segments is led by senior management, the results are reviewed and resources are allocated by our Chief Executive Officer, the chief operating decision maker. Discrete financial information is available for each of the segments, and our Chief Executive Officer uses the results of each of the operating segments for resource allocation and performance evaluation.

The results of operations tables included below for the total company and the individual segments disclose financial results supplemented with average vessels, vessel utilization and average day rates.

Total vessel utilization is calculated on all vessels in service (which includes stacked vessels, vessels held for sale and vessels in drydock or down for repair). Active utilization is calculated on all owned and bareboat chartered vessels except vessels held for sale and stacked vessels. Vessel utilization rates are calculated by dividing the number of days a vessel works during a reporting period by the number of days the vessel is available to work in the reporting period. We consider a vessel to be stacked if the vessel crew is furloughed or substantially reduced and limited maintenance is performed on the vessel. Although not currently fulfilling charters, stacked vessels are considered in service and included in the calculation of our utilization statistics. As such, stacked vessels depress utilization rates because stacked vessels are considered available to work and are included in the calculation of utilization rates. We had seven stacked vessels at September 30, 2025 and one stacked vessel at December 31, 2024. The increase in stacked vessels is primarily attributable to recently idled older crew boats.

Vessel day rates are determined by the demand created largely through the level of offshore exploration, field development and production spending by energy companies relative to the supply of offshore support vessels. Specifications of available equipment and the scope of service provided may also influence vessel day rates. Average day rates are calculated by dividing the revenue a vessel earns during a reporting period by the number of days the vessel worked in the reporting period. Vessel operating cost per active days is calculated based on total available days less stacked days.

Total vessels in service include vessels not owned by us and under bareboat charter agreements. We had three such vessels to begin the year, but purchased one of the vessels in the third quarter now included in our owned vessel count. We gave notice to acquire one of the remaining vessels under bareboat charter, reclassifying it as a finance lease, also now included in our owned vessel count. The remaining vessel under bareboat charter is included in all vessel statistics but not included in our owned vessel count. These vessels affect the average vessel count in different degrees depending on when they were acquired or recorded as a finance lease.

Consolidated Results – Three Months Ended September 30, 2025 compared to June 30, 2025

(In Thousands except for statistics)

Revenue:

• Decrease primarily due to the slightly lower average day rates, partially offset by increased utilization.
• The decrease in day rates was due to declines in demand in West Africa and Europe/Mediterranean.
• We sold four older crew boats during the third quarter. These sales combined with lower drydock and off-hire days increased our utilization.

Vessel operating costs:

• Increase primarily due to significantly higher crew and repairs costs. Higher crew costs were caused by a higher proportion of vessels working in Australia where operating costs are higher. Higher repair costs were related to several high-cost repairs in the third quarter. These increases were partially offset by lower other operating costs primarily related to insurance claims and the cost of a relief vessel in the second quarter.

General and administrative:

• Increase primarily due to higher professional fees.

Depreciation and amortization:

• Increase primarily due to higher drydock activity.

Gain on asset dispositions, net:

• During the third quarter of 2025, we sold four vessels for approximately $1.2 million in proceeds and recognized a net gain of $0.6 million on the dispositions. During the second quarter of 2025, we sold four vessels for approximately $7.3 million in proceeds and recognized a net gain of $5.5 million on the dispositions.

Interest income and other, net:

• No significant variances.

Loss on early extinguishment of debt:

• Increase primarily due to the early redemption premiums incurred in conjunction with the redemption of the 10.375% Senior Unsecured Notes due July 2028 and the 8.5% Senior Secured Notes due 2026.

Interest expense:

• No significant variances.

Foreign exchange gains (losses):

• Our foreign exchange gains in the third and second quarters of 2025 were primarily the result of the settlement and revaluation of various foreign currency balances due to the weakening of the U.S. Dollar, largely in the second quarter, against the Central and West African Franc, Norwegian Kroner, Brazilian Real, Angola Kwanza, British Pound and Euro.

Income tax expense:

• We are subject to taxes on our income in many jurisdictions worldwide and our actual tax expense can vary disproportionally to overall net income due to the mix of profits and losses in these foreign tax jurisdictions. Our tax expense for the three months ended September 30, 2025 includes the impact from Pillar Two and taxes on our operations in foreign countries. The increase in income taxes for the three months ended September 30, 2025, compared to the three months ended June 30, 2025, was primarily driven by the full release of the valuation allowance in the U.S. on net operating losses in the three months ended June 30, 2025.

Segment results for three months ended September 30, 2025 compared to June 30, 2025

Americas Segment Operations.

(In Thousands except for statistics)

Revenue:

• Increase primarily driven by higher active utilization and higher average day rates.
• Utilization increased as idle time, drydock days and mobilization days decreased, partially offset by an increase in repair days.

Vessel operating costs:

• Increase primarily due to higher crew costs related to vessels mobilizing to the segment.

General and administrative expense:

• Increase primarily due to a vessel mobilized into the segment.

Asia Pacific Segment Operations.

(In Thousands except for statistics)

Revenue:

• Increase primarily driven by higher utilization and higher average day rates.
• Utilization increased due to lower idle and repair days.

Vessel operating costs:

• Increase primarily due to higher crew costs caused by a higher proportion of vessels working in Australia where operating costs are higher.

General and administrative expense:

• Increase is largely due to separation costs in the third quarter.

Middle East Segment Operations.

(In Thousands except for statistics)

Revenue:

• Increase primarily driven by higher utilization and higher average day rates.
• Utilization increased primarily due to lower repair and idle days, partially offset by higher drydock days.

Vessel operating costs:

General and administrative expense:

• Increase due to higher amortization of drydock costs.

Europe/Mediterranean Segment Operations.

(In Thousands except for statistics)

Revenue:

• Decrease primarily driven by lower average day rates and lower utilization.
• Average day rate decreases are largely due to decreased demand.
• Active utilization decreased due to higher idle and repair days.

Vessel operating costs:

• Increase primarily due to higher repair costs and higher fuel costs largely related to greater idle time and drydock time.

General and administrative expense:

• Decrease primarily due to lower drydock amortization as a result of net vessel transfers.

West Africa Segment Operations.

(In Thousands except for statistics)

Revenue:

• Decrease primarily driven by lower average day rates, partially offset by increased active utilization.
• Decreased drydock and idle days contributed to the increase in utilization.

Vessel operating costs:

• Decrease primarily due to lower other costs related to a relief vessel in the second quarter, partially offset by higher repair costs.

General and administrative expense:

• Increase due to higher amortization of drydock costs.

Consolidated Results – Nine Months Ended September 30, 2025 compared to September 30, 2024

(In Thousands except for statistics)

Revenue:

• Increase primarily due to increased day rates partially offset by lower active utilization as a result of higher idle days.
• We took delivery of six new crew boats during the first nine months of 2025 and stacked some older crew boats. We sold ten older vessels, eight of which were crew boats.

Vessel operating costs:

• Decrease primarily due to lower crew costs in Americas and Asia Pacific segments and lower fuel and supplies costs in Americas and Europe/Mediterranean segments. These cost reductions were partially offset by higher repair costs resulting from increased repair days and higher other operating costs primarily related to an accrual for a legal claim.

General and administrative:

• Increase primarily due to higher personnel costs, higher stock compensation and charges associated with a transition and separation agreement. We also incurred higher professional fees in 2025 compared to 2024. In 2024, we had a significant recovery of bad debt expense that did not recur in 2025.

Depreciation and amortization:

• Increase primarily due to higher amortization of drydock costs.

Gain on asset dispositions, net:

• During the first nine months of 2025, we sold ten vessels for approximately $12.3 million in proceeds and recognized a net gain of $8.6 million on the dispositions. During the first nine months of 2024, we sold four vessels for approximately $14.9 million in proceeds and recognized a net gain of $13.1 million on the dispositions.

Interest income and other, net:

• Increase primarily due to a Brazil legal case recovery, which included an interest component.

Loss on early extinguishment of debt:

• Increase primarily due to the early redemption premiums incurred in conjunction with the redemption of the 10.375% Senior Unsecured Notes due July 2028 and the 8.5% Senior Secured Notes due 2026.

Interest expense:

• Decrease due to lower debt levels as we made principal payments of $26.5 million in the first six months of 2025 which followed payments of $76.5 million in the third and fourth quarters of 2024. These principal payments were partially offset by $11.5 million in new debt related to the six crew boats delivered in 2025. In addition, in July 2025, we issued $650.0 million of 9.125% Senior Notes due 2030, and refinanced all of our long-term debt, except for the vessel facility debt. The new Senior Notes interest cost is not materially different than the interest cost associated with the previous debt on a monthly basis.

Foreign exchange gains (losses):

• Our foreign exchange gains in 2025 and losses in 2024, were primarily the result of the settlement and revaluation of various foreign currency balances due to a weakening/strengthening of the U.S. Dollar against the Central African CFA Franc, West African CFA Franc, Norwegian Kroner, Brazilian Real, Angola Kwanza, British Pound and Euro.

Income tax expense:

• We are subject to taxes on our income in many jurisdictions worldwide and our actual tax expense can vary disproportionally to overall net income due to the mix of profits and losses in these foreign tax jurisdictions. Our tax expense for 2025 includes the impact from Pillar Two and taxes on our operations in foreign countries. Tax expense for 2024 is mainly attributable to taxes on our operations in foreign countries. During 2025, we released valuation allowance in the U.S. on net operating losses.

Segment results for nine months ended September 30, 2025 compared to September 30, 2024

Americas Segment Operations.

(In Thousands except for statistics)

Revenue:

• Decrease primarily driven by a lower active vessel count and lower active utilization due to a decrease in vessel demand and vessel transfers, partially offset by higher average day rates.
• Utilization decreased due to higher idle days, partially offset by lower drydock and repair days.

Vessel operating costs:

• Decrease primarily due to lower crew costs associated with reduced manning levels resulting from higher idle days, a vessel transfer out of the segment and the sale of a vessel in the first nine months of 2025. This decrease was partially offset by an increase due to a legal claim accrual.

General and administrative expense:

• Increase primarily due to a credit to bad debt expense in the first nine months of 2024.
• Increase primarily due to higher amortization of drydock costs.

Asia Pacific Segment Operations.

(In Thousands except for statistics)

Revenue:

• Decrease primarily driven by a lower vessel count and lower utilization, partially offset by higher average day rates.
• Utilization decreased due to higher idle, drydock and repair days.

Vessel operating costs:

• Decrease primarily due to lower crew costs resulting from a lower proportion of vessels working in Australia where operating costs are significantly higher.

General and administrative expense:

• Increase due to higher amortization of drydock costs.

Middle East Segment Operations.

(In Thousands except for statistics)

Revenue:

• Increase primarily driven by higher day rates, partially offset by slightly lower utilization.
• Utilization decreased primarily due to higher drydock days.

Vessel operating costs:

• Decrease primarily due to lower mobilization and training costs.

General and administrative expense:

• Decrease due to fully amortizing certain vessel modifications required by a customer.

Europe/Mediterranean Segment Operations.

(In Thousands except for statistics)

Revenue:

• Increase primarily driven by higher utilization and higher average day rates which benefitted from higher demand and from foreign exchange related to British Pound, Euro and Norwegian Kroner denominated contracts. This increase was partially offset by a lower vessel count.
• Active utilization increased due to lower drydock and repair days.

Vessel operating costs:

• Increase primarily due to higher crew costs associated with higher payroll tax expense and the impact of foreign exchange related to payment of wages in British Pound and the Norwegian Kroner. We also incurred higher other costs resulting from unplanned items incidental to vessels being down for repair and higher training costs. Fuel costs decreased due to lower drydock and repair days.

General and administrative expense:

• Increase primarily due to higher personnel costs and higher professional fees.
• Increase due to higher amortization of drydock costs.

West Africa Segment Operations.

(In Thousands except for statistics)

Revenue:

• Decrease primarily driven by lower active utilization as a result of increased idle days partially offset by substantially higher average day rates.
• We took delivery of six new crew boats in 2025 and stacked some older crew boats, eight of which were sold.

Vessel operating costs:

• Increase primarily due to higher repair costs associated with increased repair days; higher fuel costs associated with increased idle and stacked days; and higher other costs associated with a relief vessel engaged as a substitute for another vessel in drydock.

General and administrative expense:

• Increase due to higher personnel costs and professional fees and a credit to bad debt expense in the first nine months of 2024.
• Increase primarily due to higher amortization of drydock costs.

Liquidity, Capital Resources and Other Matters

Our objective in financing our business is to maintain and preserve adequate financial resources and sufficient levels of liquidity. As of September 30, 2025, we had $431.1 million in cash and cash equivalents, and a borrowing capacity under our Revolving Credit Facility of $250.0 million for which any future borrowings would be due April 2030. On July 7, 2025, we issued $650.0 million in 9.125% Senior Notes that mature in July 2030 (2030 Notes). With the proceeds of the offering, we redeemed most of our outstanding debt as of June 30, 2025, including accrued interest and early redemption premiums. Also on July 7, 2025, we executed the $250.0 million Revolving Credit Facility that replaced our previous $25.0 million credit facility. As of the date of this filing, no amounts have been drawn under the Revolving Credit Facility. For more information, see Note (8) - “Debt” to the Condensed Consolidated Financial Statements included in this Form 10-Q. We believe cash and cash equivalents, coupled with our revolving credit capacity, supplemented with future net cash provided by operating activities, will provide us with sufficient liquidity to fund our obligations and meet our liquidity requirements.

Our cash and cash equivalents include restricted cash and amounts held by foreign subsidiaries, the majority of which is available to us without adverse tax consequences. Included in foreign subsidiary cash are balances held in U.S. dollars and foreign currencies that await repatriation due to various currency conversion and stringent repatriation constraints, partner and tax related matters. We currently expect earnings by our foreign subsidiaries will be indefinitely reinvested in foreign jurisdictions to fund strategic initiatives (such as investment, expansion and acquisitions), fund working capital requirements and repay intercompany liabilities of our foreign subsidiaries in the normal course of business. Moreover, we do not currently intend to repatriate earnings of our foreign subsidiaries to the U.S. because cash generated from our domestic businesses and the repayment of intercompany liabilities from foreign subsidiaries are currently sufficient to fund the cash needs of our U.S. operations.

A key component of our growth strategy is expanding our business and fleets through acquisitions, joint ventures and other strategic transactions. We would expect to use net proceeds from any sale of our securities for general corporate purposes, including capital expenditures, investments, acquisitions, repayment or refinancing of indebtedness, and other business opportunities.

Working capital, which includes cash on hand, was $523.9 million at September 30, 2025, and includes $5.8 million of current maturities on long term debt. During the nine months ended September 30, 2025, we generated $114.0 million in net income and $226.1 million in cash flow from operating activities, which includes our interest payments and drydock costs.

As of September 30, 2025, our primary customer in Mexico had an aggregate outstanding receivable balance of $56.4 million, with $45.4 million over 90 days past due, which represented approximately 17.0% of our total trade and other receivables balance. The amounts are not in dispute. In October 2025, we received a $7.4 million payment, which was the first payment from this customer since June 2024. The customer has promised additional payments prior to the end of the year. We have not historically had, and we do not expect to have, any material write-offs due to the collectability of these receivables. However, future delays in this customer's payments could differ from historical practice and our current expectations, and could negatively impact our future results.

We signed agreements for the construction of two ocean going tugs and eight crew boats, all of which have been delivered as of September 30, 2025. We entered into Facility Agreements to finance a portion of the construction and delivery costs for approximately EUR 24.9 million ($26.7 million). Each of the ten Facility Agreements bears interest at fixed rates ranging from 2.7% to 6.3% and are payable in ten equal principal semi-annual installments, with the first installment commencing approximately six months following delivery of the vessel. Each Facility Agreement is secured by the respective vessel, guaranteed by Tidewater as parent guarantor and have no financial covenants.

Please refer to Note (8) - “Debt” to the accompanying Condensed Consolidated Financial Statements for further details on our indebtedness.

Share Repurchases

On February 27, 2025, our Board of Directors (Board) approved a $90.3 million share repurchase program, and then on August 1, 2025, our Board approved a new $500.0 million share repurchase program. During the nine months ended September 30, 2025, we repurchased and retired 2,290,204 shares for approximately $90.0 million, excluding commissions and a 1% excise tax. During 2024, our Board approved several share repurchase programs aggregating $90.7 million. During the year ended December 31, 2024, we repurchased and retired 1,384,186 shares for approximately $90.7 million, excluding commissions and a 1% excise tax. Please refer to Item 5 of our 2024 Annual Report - Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities for additional information regarding repurchases of our common stock. See also Part II. Item 2. “Issuer Repurchases of Equity Securities” set forth herein and Note (5) - “Stockholders’ Equity and Dilutive Equity Instruments” to the accompanying Condensed Consolidated Financial Statements for current year repurchases.

Dividends

No dividends were declared for the nine months ended September 30, 2025 and 2024. See also Note (5) - “Stockholders’ Equity and Dilutive Equity Instruments” to the accompanying Condensed Consolidated Financial Statements.

Operating Activities

Net cash provided by operating activities for the nine months ended September 30, 2025 and 2024 was $226.1 million and $182.4 million, respectively.

Net cash provided by operating activities for the nine months ended September 30, 2025 reflects net income of $114.0 million, which includes non-cash depreciation and amortization of $196.2 million and net gains on asset dispositions of $8.6 million. Combined changes in operating assets and liabilities provided $0.9 million in cash, and cash paid for deferred drydock and survey costs was $84.7 million.

Net cash provided by operating activities for the nine months ended September 30, 2024 reflects net income of $142.7 million, which includes non-cash depreciation and amortization of $178.2 million and net gains on asset dispositions of $13.1 million. Combined changes in operating assets and liabilities used $22.9 million in cash, and cash paid for deferred drydock and survey costs was $115.6 million.

Investing Activities

Net cash used in investing activities for the nine months ended September 30, 2025 and 2024 was $7.7 million and $6.0 million, respectively.

Net cash used in investing activities for the nine months ended September 30, 2025 reflects receipt of $12.3 million primarily related to the sale of 10 vessels. Additions to properties and equipment were comprised of approximately $15.2 million in capitalized upgrades to existing vessels and equipment and $5.4 million primarily for other property and information technology equipment purchases and development work.

Net cash used in investing activities for the nine months ended September 30, 2024 reflects the receipt of $14.9 million primarily related to the sale of four vessels. Additions to properties and equipment were comprised of approximately $20.3 million in capitalized upgrades to existing vessels and equipment and $2.7 million primarily for other property and information technology equipment purchases and development work.

Financing Activities

Net cash used in financing activities for the nine months ended September 30, 2025 and 2024 was $132.4 million and $164.4 million, respectively.

Net cash used in financing activities for the nine months ended September 30, 2025 included proceeds from long-term debt of $650.0 million, payments of long-term debt of $640.1 million, the purchase of 2,290,204 shares of our common stock for $90.1 million, debt issuance costs of $19.0 million, early redemption premiums of $19.6 million reflecting the retirement of the senior notes, finance lease payments of $5.5 million and the acquisition of $8.0 million in shares to pay employee taxes on share-based awards.

Net cash used in financing activities for the nine months ended September 30, 2024 included payments of long-term debt of $89.0 million, the purchase of 520,082 shares of our common stock for $46.6 million, debt issuance costs of $0.2 million and the acquisition of $28.5 million in shares to pay employee taxes on share-based awards.

Application of Critical Accounting Policies and Estimates

Our 2024 Annual Report filed with the SEC on February 27, 2025, describes the accounting policies that are critical to reporting our financial position and operating results and that require management’s most difficult, subjective or complex judgments. This Quarterly Report on Form 10-Q should be read in conjunction with the discussion contained in our 2024 Annual Report regarding these critical accounting policies.

New Accounting Pronouncements

For information regarding the effect of new accounting pronouncements, see “Note (2) - Recently Issued or Adopted Accounting Pronouncements” of Notes to Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

For quantitative and qualitative disclosures about market risk affecting us, see Item 7A. “Quantitative and Qualitative Disclosures about Market Risk,” in our 2024 Annual Report. Our exposure to market risk has not changed materially since December 31, 2024.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed with the objective of ensuring that all information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended (Exchange Act), such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized and reported, within the time periods specified in the SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. However, any control system, no matter how well conceived and followed, can provide only reasonable, and not absolute, assurance that the objectives of the control system are met.

We evaluated, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2025.

Changes in Internal Controls Over Financial Reporting

There has been no change in our internal controls over financial reporting that occurred during the quarter ended September 30, 2025, that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

There are numerous factors that affect our business and results of operations, many of which are beyond our control. In addition to other information presented in this quarterly report, you should carefully read and consider “Item 1A - Risk Factors” in Part I and “Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II of our 2024 Annual Report, and “Item 1A. Risk Factors” in Part II of our Quarterly Report on Form 10-Q for the quarterly period ending June 30, 2025, which contain descriptions of significant risks that may cause our actual results of operations in future periods to differ materially from those currently anticipated or expected.