Constellation Oil Services (COSH) Q2 2026 earnings summary

Executive summary

• Offshore floater market utilization at 87%, with contracting activity double last year's level; market expected to tighten further despite near-term softening.

• Achieved strong operational performance with 99% fleet uptime and industry-leading contract coverage, supported by a $2.5 billion backlog as of July 2026.

• Completed successful $650 million bond refinancing at a lower coupon, reducing annual debt service, extending maturities, and supporting deleveraging.

• Entered the second half of 2026 in a position of strength, with repriced contracts, major contract extensions, and shareholder distributions underway.

• Net profit for H1 2026 was $34.5 million, reversing a prior year loss, with comprehensive income of $39.3 million including FX gains.

Financial highlights

• Q2 2026 net operating revenue was $252 million, up 81.3% year-over-year, driven by new contracts, managed fleet operations, and FX gains.

• Adjusted EBITDA for Q2 2026 reached $126.4 million (50.2% margin), more than doubling year-over-year; H1 2026 adjusted EBITDA was $223.6 million (49.4% margin).

• Net profit was $1.4 million in Q2 2026, impacted by a $50 million non-cash warrant provision; adjusted net profit was $51 million.

• Cash and equivalents at June 30, 2026, were $225.5 million; net debt at $422 million.

• CapEx in Q2 2026 totaled $24 million, mainly for rig upgrades and maintenance.

Outlook and guidance

• Full-year 2026 guidance maintained, with revenue expected at $740–$775 million and adjusted EBITDA at $350–$385 million.

• Contract backlog of $2.5 billion ensures substantial earnings and cash flow visibility through 2030.

• Step-up in shareholder distributions expected later in 2026, pending board review.

• Atlantic Star expected to remain stacked for the rest of 2026; commercial opportunities being pursued for 2027.

• Ongoing monitoring of Brazilian tax reform and regulatory changes.