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FAQ: Stonegate Capital Partners' Q3 2025 Coverage Update on Civeo Corporation (CVEO)
TL;DR
Civeo's strategic cost-cutting and share buybacks position investors for potential gains as Australian growth and Canadian efficiency improvements drive EBITDA expansion.
Civeo reported $170.5M revenue and $28.8M adjusted EBITDA, with Australian operations growing 19% while Canadian margins improved through lodge closures and headcount reductions.
Civeo's expansion in Australia and efficiency improvements support stable workforce housing for energy projects, contributing to regional economic development and infrastructure advancement.
Civeo's Australian villages added 763K billed rooms while buying back 1.05M shares, showing how accommodation services fuel both operational growth and shareholder returns.
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Civeo reported revenue of $170.5M and adjusted EBITDA of $28.8M for Q3 2025, with operating cash flow of $13.8M and capital expenditures of $5.6M primarily for lodge and village maintenance.
Canadian operations generated $46.0M in revenue and $8.0M in adjusted EBITDA, improving from $57.7M and $3.4M in Q3 2024 despite a 20% decline in billed rooms, driven by successful cost rationalization measures.
Australian revenues increased 7% year-over-year to $124.5M and adjusted EBITDA grew 19% to $26.7M, primarily due to a full quarter contribution from four Bowen Basin villages acquired in May 2025, which added approximately $8.4M in incremental revenue.
Civeo repurchased 1.05M common shares during Q3 and has returned approximately $52M year-to-date, completing about 69% of its authorization to repurchase 20% of total shares outstanding, with plans to use at least 100% of annual free cash flow to complete the current authorization.
Civeo tightened its full-year 2025 guidance to revenue of $640–$655M and adjusted EBITDA of $86–$91M, maintaining capital expenditures at $20–$25M.
Stonegate's DCF analysis values Civeo between $26.73 and $31.19 with a midpoint of $28.79, while their EV/EBITDA valuation ranges from $27.82 to $31.58 with a midpoint of $29.70.
Canadian operations improved through headcount reductions, closure of underutilized lodges, and streamlining of field operations, which collectively drove a 35% increase in gross margin to 22.5% despite lower billed rooms.
Management anticipates relatively flat-to-up consolidated performance in 2026, supported by a full-year contribution from the Bowen Basin acquisition, further integrated services growth, and initial redeployment of mobile camp assets in North America as new infrastructure projects advance.
The company ended Q3 with net debt of $176M, a net leverage ratio of 2.1x, and liquidity of approximately $70M.
Stonegate Capital Partners is a capital markets advisory firm providing investor relations, equity research, and institutional investor outreach services for public companies, and they have updated their coverage analysis on Civeo Corporation.
Curated from Reportable
