Tidewater Inc. (NYSE:TDW) Q2 2019 Earnings Conference Call - Final Transcript
Aug 13, 2019 • 11:00 am ET
Thank you. We will now begin the question-and-answer session. [Operator Instructions] And our first question comes from Turner Holm from Clarksons Platou. Your line is open.
Hey there, guys. Good morning. This is Turner Holm from Clarksons Platou.
John T. Rynd
Hey, John. I just wanted to drill into your last comment of your prepared remarks that you see reason for optimism in some of the older markets that you mentioned. And what we're hearing is maybe some flattening of leading-edge day rates in particular markets perhaps, seasonal in the North Sea. But their guidance is for maybe flat-to-slightly down day rates for the third quarter. Can you kind of just flesh that out a little bit, how you're thinking about that optimism, is it activity related or is it sort of being at day rates that you're seeing?
John T. Rynd
All right. The combination of things started at a good one. Every market we participate in is on solid footing right now. And really, the driver of our slight reduction in average day rate in the third quarter is more as a result of coming off those legacy term contracts in higher day rates, not reflective of where leading-edge day rates are. And as you know, we guided the fourth quarter day right back up slightly since we see improvement in every major market. Again, some of it's seasonality like you said, the North Sea -- we will watch the North Sea as we progress into the winter months. West Africa appears to be some -- gaining some strength around the world, Brazil is gaining strength, and Mexico is gaining strength, the Med is holding solid. So again, the Gulf of Mexico, really driven by supply migrating outside of the US, Gulf of Mexico has been holding up nicely. So again, as we look around the world, there's reasons for my optimism in all of our key markets.
Sure. Thanks for that. I understand you all took some contracts down in Guyana recently or have some vessels on the way down there. Relatively encouraging discovery earlier this week by Tullow. I'm wondering if you all see that as being a sort of attractive market and maybe a place to -- just to add some active vessels in the next couple of quarters?
John T. Rynd
Yeah, I think you have to be paying attention to the Guyana area. Actually, our vessels are moving to Suriname for Apache. And then in October, we have a vessel moving into Exxon Guyana for a five-year contract. So that's a market we're staying very close to. And also, as you mentioned, great news on the Tullow discovery. So I think obvious scenario it's going to get a lot of attention from us and others.
Thanks, John and Quentin, just one for you. There was some talks earlier in the year about possibly extracting some value from the [Indecipherable] receivable balance. I know it was quite flat this quarter, is there anything to report there with regard to possibly monetizing that