OCEANEERING INTERNATIONAL INC (OII)

Oceaneering International, Inc. is a global technology company that delivers engineered services and products and robotic solutions to the offshore energy, defense, aerospace, manufacturing and entertainment industries. It was organized as a Delaware corporation in 1969 through the combination of three diving service companies founded in the early 1960s, and it has focused on underwater services and products that rely on advanced technology. The company believes it is one of the world's largest underwater services contractors, and it has extended its technologies into adjacent markets focused on autonomous robotics. Foreign operations, principally in Africa, Asia and Australia, the United Kingdom, Brazil and Norway, accounted for about 58% of 2023 revenue, or $1.4 billion.

Operations are organized into an Energy business with four segments and a single Aerospace and Defense Technologies segment. Subsea Robotics (31% of 2023 revenue) provides work-class remotely operated vehicles (ROVs), ROV tooling and survey services. Oceaneering owned 250 work-class ROVs at year-end 2023, including the battery-operated Liberty E-ROV, Isurus systems and the hybrid AUV/ROV Freedom, and it estimates a 61% share of contracted floating drilling rigs. Manufactured Products (20%) makes subsea umbilicals, production control equipment, clamp connectors, pipeline connector and repair systems and control valves, and it also supplies autonomous mobile robotic technology, including theme park entertainment systems. Offshore Projects Group (22%) provides subsea installation, intervention, inspection, maintenance and repair, riserless light well intervention, workover control systems, decommissioning, drill pipe riser services and diving services. It operates mainly in the U.S. Gulf of Mexico and offshore Angola, using three owned and six chartered dynamically positioned deepwater vessels plus one owned survey vessel. Integrity Management & Digital Solutions (11%) offers asset integrity, corrosion management, inspection and nondestructive testing services, plus software and digital solutions for the energy and maritime industries. Aerospace and Defense Technologies (16%) provides engineering and manufacturing services to the U.S. Navy, NASA, other government agencies, prime contractors and commercial space companies.

Energy customers are domestic, international and national oil and gas companies engaged in offshore exploration, development and production, and Oceaneering also acts as a subcontractor to other oilfield service companies. The company is also pursuing offshore wind, nuclear, hydrogen, carbon capture and sequestration, tidal energy and mobile robotics opportunities. Mobile robotics and theme park solutions are sold to industrial, manufacturing, healthcare, warehousing and commercial entertainment customers. Energy contracts are typically competitively bid and often dayrate-based, while product sales are generally fixed price. The top five customers made up 36% of 2023 revenue, and the U.S. Government alone accounted for 10%. Backlog stood at about $2.3 billion at the end of 2023.

Oceaneering builds, retrofits and upgrades its ROVs in-house, with its largest facility in Morgan City, Louisiana, and makes umbilicals at plants in the United States, Scotland and Brazil. Key raw materials include steel, polymers, copper wire, electronic components and plastics, generally available from multiple sources, and it also uses forges, foundries, fabricators, machine shops and logistics providers. The company competes with several worldwide providers and many local firms, and it faces local-content rules in some jurisdictions. Its owned vessels are Jones Act-compliant. Revenue is somewhat seasonal, with the Gulf of Mexico and European operations most active in the second and third quarters. The company holds numerous patents and licenses but relies mainly on its know-how.