Oceaneering International (OII) 2026 年第三季法說會：EBITDA 達 1.19 億美元，發布 2027 年財測指引

Oceaneering International (NYSE: OII) 在水下機器人定價、探勘活動及有利的海上專案組合支撐下，公布 2026 年第三季營收與調整後 EBITDA 均高於去年同期。與再融資相關的損失降低了列報的淨利，而強勁的營業現金流與延後的資本支出則提升了單季自由現金流。

重點摘要

• 第三季營收年增 6% 至 7.85 億美元，營業利益成長 7% 至 9,200 萬美元，調整後 EBITDA 成長 7% 至 1.19 億美元——創下自 2015 年第四季以來的最高單季水準。
• 歸屬於 Oceaneering 的淨利下降 26% 至 5,260 萬美元（即每股盈餘 0.52 美元），主要歸因於與長期債務再融資相關的一次性損失。
• 水下機器人部門（Subsea Robotics）創造了 2.33 億美元營收及 7,540 萬美元營業利益。其 EBITDA 利潤率達到 39%，創下 Oceaneering 自 2020 年重組事業部門以來的最高紀錄。
• 營業現金流為 1.63 億美元，自由現金流達到 1.42 億美元。截至本季末，Oceaneering 擁有 7.35 億美元現金、超過 10 億美元的流動資金，且無旋轉信貸設施借款。
• 管理層預計 2026 年第四季合併 EBITDA 為 8,500 萬至 9,500 萬美元，更高的現金稅與資本支出將放緩自由現金流的增長。
• 初步的 2027 年指引預計合併 EBITDA 為 4.3 億至 4.8 億美元，自由現金流將高於預期的 2026 年水準。管理層表示，該區間主要反映了水下機器人、航太與國防科技（AdTech）以及海上專案小組（OPG）活動的時間點不確定性。

關鍵財務數據

業務與營運表現

水下機器人部門

水下機器人（Subsea Robotics，簡稱 SSR）營收與營業利益均實現成長。營收為 2.33 億美元，營業利益為 7,540 萬美元。每運作日 ROV 平均營收從 11,254 美元增加至 11,781 美元，船隊利用率則維持在 65%。

39% 的 EBITDA 利潤率反映了歐洲、西非與挪威市場更好的 ROV 定價、探勘活動的增加，以及與美國墨西哥灣業務相關的一次性合約成本回收。歐洲、蓋亞那與西非提高的活動量抵銷了美國墨西哥灣活動量的下降。

Oceaneering 在多個地區獲得總計約 1.8 億美元的 ROV 和探勘合約，期程延伸至 2031 年。截至本季末，該公司在 136 個浮動式鑽油平台的簽約總數中，取得 80 個平台的 ROV 合約，市占率達 59%。其船隊規模維持在 250 套 ROV 系統。

製造產品部門

製造產品部門（Manufactured Products）營收成長 8%，營業利益則相對持平於 2,510 萬美元。營業利益率小幅下降至 15%，主因是與去年同期特別強勁的基期相比，Grayloc 產品活動量與獲利能力有所下滑。

截至本季末，在約 1.6 億美元新獲得訂單的推升下，積壓訂單達 4.35 億美元。過去 12 個月的出貨與接單比（book-to-bill ratio）為 0.77。根據近期新簽訂單與銷售前景，管理層維持全年比率在 0.9 至 1.0 的預期。

海上專案小組與 IMDS

海上專案小組（Offshore Projects Group，OPG）的營收、營業利益及利潤率皆相對持平。本季完成的國際安裝工作抵銷了西非活動量的減少以及美國墨西哥灣較不有利的專案組合。

誠信管理與數位解決方案部門（Integrity Management and Digital Solutions，IMDS）營收成長 7%，營業利益與利潤率則相對持平。中東、歐洲及美國墨西哥灣活動量的增加，部分被西非活動量減弱、專案組合變動以及中東成本上升所抵銷。

航太與國防科技部門

航太與國防科技部門（AdTech）營收成長 7% 至 1.35 億美元，主因先前公布的大型計畫目前階段已配備完整人力。營業利益下降 11% 至 1,470 萬美元，營業利益率下滑至 11%，部分反映了代轉發包活動增加。

該部門獲得了兩項美國海軍計畫的後續續約合約。乾塢艙（dry dock shelter）計畫在五年內潛在價值達 1.54 億美元，而潛艦救援系統合約在 18 個月內潛在價值達 6,700 萬美元。

管理層展望指引

針對 2026 年第四季，管理層預計合併營收將實現年成長，調整後 EBITDA 落在 8,500 萬至 9,500 萬美元之間。未分配費用預計約為 5,000 萬美元。

各部門展望如下：

• SSR：受益於每運作日 ROV 平均營收改善及探勘活動增加，營收將提升；但由於區域組合、鑽油平台自美國墨西哥灣遷移產生的動員成本，以及低利潤率探勘工作增加，營業利益將下滑。
• 製造產品部門：營收與營業利益雙雙成長。
• OPG：受專案組合、去年同期國際干預專案竣工以及美國墨西哥灣低利潤率工作影響，營收相對持平，營業利益下降。
• IMDS：營收與營業利益雙雙成長。
• AdTech：營收與營業利益雙雙成長。

針對 2027 年，Oceaneering 提出了 4.3 億至 4.8 億美元的合併 EBITDA 指引。自由現金流預計將超越預期的 2026 年水準。

在 ROV 利用率提升、價格保持穩定以及探勘與工具服務表現改善的支撐下，管理層預計 SSR 的營收與營業利益將有所成長，且 EBITDA 利潤率保持穩定。製造產品部門預計將保持相對持平。OPG 營收預期下降，但營業利益維持持平且利潤率提升。IMDS 與 AdTech 皆預計將實現更高營收、大幅成長的營業利益以及改善的利潤率。

該公司還計畫在 2027 年繼續實施庫藏股買回，目前既有授權額度下剩餘約 500 萬股。

風險與關注領域

• 管理層表示，2027 年展望的主要不確定因素在於時間點。鑽油平台搬遷、客戶資本預算以及 OPG 專案的時間排程均可能延後預期活動。
• 持續性決議案（continuing resolution）與美國撥款的不確定性可能會放緩 AdTech 新計畫的啟動，儘管管理層指出現有工作整體上獲得較好支持。
• 隨著現金稅與資本支出增加，第四季自由現金流預計將放緩。
• 由於鑽油平台自美國墨西哥灣移往其他地區，SSR 面臨近期的動員成本與地理區域組合壓力。
• 管理層將美國墨西哥灣活動量下降列為需要關注的領域，同時預期在巴西、蓋亞那、莫三比克及非洲其他地區將迎來成長機會。

分析師問答環節亮點

管理層表示，SSR 時間點、AdTech 計畫啟動以及 OPG 國際機會是造成 2027 年 EBITDA 展望指引 5,000 萬美元差距的主因。低標並不代表管理層對深水市場建設性看法的改變，主要反映了對客戶支出與鑽油平台活動開始時間點的謹慎態度。

在資本配置方面，Oceaneering 打算繼續投資於其核心能源業務，包括遠端作業、水下檢測及數位雙生（digital-twin）技術。在 AdTech 方面，管理層會考量涉及加工能力、技術勞力、電子或感測器技術的收購案，以補強現有國防計畫。管理層排除了僅為了獲取市場信譽而支付過高估值倍數的可能性。

管理層指明巴西、蓋亞那與非洲（包括莫三比克與西非）為關鍵的潛在成長地區。公司亦提及地中海東部、埃及離岸海域及挪威的機會，特別是在水下繫結（subsea tiebacks）與安裝工程方面。

通貨膨脹並未被視為當前的主要限制。管理層表示，合約價格調整機制、價格調整、營運效率及遠端作業有助於減輕零組件與人工成本壓力。

完整法說會逐字稿

完整財報電話會議逐字稿

管理層陳述

Operator

Welcome to Oceaneering International 2026 Results Conference Call. Today's call is being webcast, and a replay will be available on our website. With me today are Rod Larson, President and Chief Executive Officer, who will provide our prepared comments; and Mike Sumruld, Senior Vice President and Chief Financial Officer. After Rob's remarks, we will open the call up to your questions. Before we begin, please note that statements made on this call about our future financial performance, business strategy, plans for future operations and industry conditions are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our remarks also include non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAAP financial measures are included in our third quarter press release, which is available on our website. With that, I'll turn the call over to Rod.

Roderick Larson

Good morning, everybody, and thanks for joining the call today. As Hilary mentioned, I'm going to be handling all of our prepared remarks today, so Mike is saving his voice for all of your math questions, so be ready. Our third quarter performance demonstrates the earnings potential of our portfolio and favorable pricing activity and project mix alone. Consolidated adjusted EBITDA was $119 million, in line with our guidance and our highest quarterly level since the fourth quarter of 2015. These results reflect solid performance in Subsea Robotics or SSR; resilience in the offshore projects group for OPG; and improvement in integrity management and digital solutions, IMDS. Highlights from the quarter include: SSR delivered increased revenue, operating income and EBITDA margin with the latter reaching its highest level since we resegmented our businesses in 2020.

We also won approximately $180 million of RM and survey contracts across multiple regions with contract terms extending into 2031. OPG saw sustained demand for its higher revenue services with a favorable mix of installation projects contributing to third quarter performance. Manufactured products secured awards of approximately $160 million during the quarter, supporting our expectation for stronger order intake in the second half of the year. And Aerospace and Defense Technologies or AdTech, secured follow-on contracts for 2 strategically important U.S. Navy programs. Drydock shelters and submarine rescue systems. The drydock shelter contract and program we have supported for over 20 years has a total potential value of $154 million over 5 years. While the summary and rescue system contract has a potential value of $67 million over 18 months.

Today, I'll focus my comments on our third quarter 2020 results, our outlook for the fourth quarter of 2026 and our initial guidance for 2027. Starting with our consolidated results for the third quarter of 2026 compared to the third quarter of 2025. We delivered revenue of $785 million, a 6% increase with growth across every operating segment, operating income of $92 million, a 7% increase and adjusted EBITDA of $119 million, also a 7% improvement. Net income attributable to Oceaneering was $52.6 million or $0.52 per share a decrease of 26%. The decrease was primarily attributable to a onetime loss related to the refinancing of our long-term debt completed during the third quarter. Adjusted EBITDA increased 7% to $119 million.

Turning to our cash flow and liquidity. We generated $163 million of cash from operating activities. Capital expenditures were $21.1 million with approximately 31% allocated to growth and 69% allocated to maintenance. This investment was less than anticipated largely due to timing with most of the deferred spending now expected in the fourth quarter. Free cash flow was $142 million, reflecting strong third quarter results as well as lower cash taxes and deferred capital expenditures. We expect both cash taxes and the capital expenditures to increase in the fourth quarter, resulting in more moderate free cash flow generation to close the year. During the quarter, we also repurchased shares of approximately $5 million with a focus on mitigating dilution associated with employee equity rates. And we ended the quarter with a cash balance of $735 million, total liquidity of more than $1 billion and no borrowings under our revolving credit facility.

Now let's look at our business operations by segment for the third quarter of 2026 also compared to the third quarter of 2025. SSR delivered revenue of $233 million and operating income of $75.4 million, both higher year-over-year. These results benefited from improved ROV pricing with average revenue per day utilized decreasing to $11,781 from $11,254 as well as higher survey activity. SSR EBITDA margin improved to 39%, primarily driven by ROV pricing improvements in Europe, West Africa and Norway. Increased survey activity and a onetime contractual cost recovery related to U.S. golf operations also contributed to higher margins. ROV fleet utilization remained stable at 65% as higher activity levels in Europe, Guyana and West Africa largely offset lower activity in the U.S. Gulf.

For the quarter, the revenue split between our ROV business and our combined tooling and survey businesses as a percentage of our total SSR revenue was 75% and 25% and compared to 77% and 23% in the third quarter of 2025. ROV days utilized grew 62%, while vessel-based services were 38% compared to 63% and 37%, respectively, in the prior year quarter. As of September 30, 2026, we had ROV contracts on 80 of the 136 floating rigs under contract or 59% market share. We maintained our fleet count of 250 ROV systems. Manufactured Products generated operating income of $25.1 million, relatively flat with the prior year quarter, while operating income margin decreased slightly to 15% on an 8% increase in revenue. These results were impacted by the final resolution of a legacy mobility solutions contract including recognition of the previously unresolved contract value.

The decline in operating income margin was primarily due to lower gray lock products activity and profitability following a particularly profitable quarter in the prior year quarter. Our backlog as of September 30, 2026, was $435 million and was largely sustained by order intake during the quarter of $160 million. Our book-to-bill ratio was 0.77 for the trailing 12-month period. Based on these recent bookings, together with our sales funnel, we remain confident in our ability to achieve a full year book-to-bill ratio of 0.9 to 1.0.

OPG revenue, operating income and operating income margin were relatively flat. Results benefited from international installation projects they concluded during the quarter, which more than offset lower activity in West Africa and a less favorable project mix in the U.S. Gulf. IMDS revenue increased 7%, while operating income and operating income margin were relatively flat, reflecting increased activity in the Middle East, Europe and the U.S. Gulf, which was partially offset by lower activity in West Africa, the changing project mix and increased costs for the Middle East. AdTech revenue increased 7% to $135 million as our previously announced large-scale program reached its full staffing levels for its current phase. Operating income decreased by 11% to $14.7 million, and operating income margin decreased to 11% due to increases in pass-through activities during the quarter and increases in [indiscernible] Unallocated expenses of $50 million were consistent with our guidance for the quarter.

Turning to our outlook for the fourth quarter of 2026 compared to the fourth quarter of 2025. We expect consolidated revenue to increase year-over-year and consolidated EBITDA to be in the range of $85 million to $95 million. By segment, for SSR, we expect revenue to increase, supported by higher ROV revenue per day utilized and increased survey activity. Operating income is expected to decrease due to changes in ROV geographic mix, additional mobilization costs as rigs relocate from the U.S. Gulf to other regions and a greater mix of lower-margin survey activity. For Manufactured Products, we anticipate higher revenue and operating income. For OPG, we expect revenue to remain relatively flat and operating income to decrease due to changes in product mix, including the completion of an international intervention project that benefited the prior year quarter and a shift to lower margin work in the U.S. Gulf. For IMDS, we anticipate higher revenue and operating income. For AdTech, we expect both revenue and operating income to be higher. We project unallocated expenses to be in the $50 million range.

Now I'll discuss our initial outlook for 2027. Looking ahead to 2027, the outlook for global deepwater markets remains constructive, with industry forecasts pointing to higher spending and activity. Floating rate activity is expected to strengthen over the course of the year as rigs complete transit to new regions and begin drilling programs. These trends provide a favorable backdrop as we established in our initial 2027 guidance. The U.S. defense environment also remains supportive, particularly across subsea programs. However, the continuing resolution and uncertain timing of appropriations process could affect the timing of program activity within AdTech. These industry conditions support our expectations for improved performance in 2027. As we announced yesterday, we are initiating consolidated EBITDA guidance in the range of $430 million to $480 million, with free cash flow expected to exceed our anticipated 2026 level.

At the segment level compared to the full year of 2026, for SSR, we expect that higher ROV utilization levels and similar pricing levels, together with improved results in survey and tooling while generating increases in revenue and operating income and stable EBITDA margins. For Manufacturing Products, revenue, operating income and operating margin are projected to be relatively flat. For OPG, we expect revenue to decrease operating income to be flat and operating margin to improve due to changes in project mix and similar utilization levels in the U.S. Gulf. For IMDS, we expect increased revenue to significantly increase operating income and improved operating margin. For AdTech, we expect significantly higher revenue and operating income and improved operating margin. We expect a slight increase in unallocated expenses.

We also plan to continue share repurchases in 2027 with approximately 5 million shares remaining under our existing repurchase authorization. As we move through the planning cycle and our customers finalize their 2027 budgets, we expect to gain greater visibility into activity levels and the timing of opportunities across our businesses. We will provide more detailed guidance for 2027 during the year-end reporting process.

In summary, we remain focused on executing through the remainder of 2026, while positioning the business for opportunities we see developing in 2027. Our priorities remain disciplined execution, cash generation, and maintaining financial flexibility to support our longer-term objectives. Thanks for your continued interest in Oceaneering we'll now be happy to take your questions.

Operator

[Operator Instructions] Your first question comes from the line of Eddie Kim with Barclays.

分析師問答

Eddie Kim

Just wanted to touch on the preliminary 2027 EBITDA guidance of $430 million to $480 million, which spans a fairly wide range there. Just curious which 2 or 3 of the -- are the largest operational assumptions separating the low end from the high end there? And which segments account for most of that $50 million spread?

Roderick Larson

I think it's the normal. The normal character, Eddie. I mean, we've got as always, SSR has got some of that based on like we've got the rate moves this year and we've got some of those things that are a little bit timing based. I think that's a part of it. Some of them will be AdTech, like we said, because we talked about some of these programs, when do the programs kick off, how does appropriations work out in some of the continuing resolutions, so if it gets resolved sooner, that brings things forward in the area, and it gives us more opportunity in the area, could push us back a little bit. It brings us to the lower end of the range. And then finally, OPG. OPG has got room to pick up more international opportunities. And I think actually, probably, if I think about OPG, it drives us to the higher end of the range. If we can put more things in that bucket, which we don't resolve some of that between now and when we report next month. I think OPG could bring more goodness to the mix as well. So I think those are the typical ones. I don't expect a big change in manufactured products because that's long lead-time stuff. And I wouldn't expect a whole lot of change in IMDS just because of the relative scale.

Edward Kim

Got it. Understood. I just wanted to touch on -- I mean, the low end of that range, $430 million doesn't represent that big of an increase over 2026, which is surprising just in light of the strong growth you're expecting to see in ad tech next year, it almost implies sort of a flattish trajectory in the energy segment, which is almost counter to kind of the constructive outlook in the offshore inflection that's expected next year. So just -- I mean does the low end of that guidance imply spending slowing down? Is that based on customer conversations you're having? Or an assumption that oil prices are going to be substantially less next year than they are now. Just any more color on kind of that low end of the guidance would be great.

Roderick Larson

I think it's mostly timing, Eddie. I mean, I think everybody thinks that things are constructive, they expect some of these pickups throughout the year next year. We just have to -- we have to make sure that we're not overstating when it starts. I think that's always the trick here is a lot of times we get the story right, but we get the timing wrong. And so we're a little bit cautious on how fast some of these things will come to fruition when they start spending. It's more about that. I think we really we truly believe that the thesis is right. The expectation for the macros is right. We're just being a little bit cautious because like I said, rigs will be moving. Some of the other projects for OPG are being contemplated, but they haven't been hard scheduled, so some of that stuff. Some of that stuff is what we're -- I think it's more of the timing.

Mike, would you add anything?

Michael Sumruld

Yes, I think it's early days, too, right? I mean this is only October. I think as we start to wrap up the year or talk to our customers, they solidify their CapEx budgets, and we start to see what's happening with the rate movement, that could change. It's just -- it's a little early.

Operator

Your next question comes from the line of Keith Beckmann with Pickering Energy Partners.

Keith Beckmann

Obviously, we had -- with the refinancing that's completed kind of during the summer and maybe the significant net cash position you guys have here, right? I mean how are you guys thinking about capital deployment heading into 2027? And maybe more specifically within ad tech, I mean, what are what's maybe an example of kind of a business that could make sense from an M&A perspective versus something that doesn't if you guys went that route? And then maybe how are you weighing that against buybacks.

Roderick Larson

Sure. Keith, I appreciate that question. I mean, you led into that. I think capital deployment. We expect to continue to make investments in our core energy businesses. There may be even some opportunity to bolt on some technology some things that we can be a little disruptive with in the energy side on that side of the business. But on the AdTech side, it is a lot of focus around, are there some inorganic Opportunities, some acquisitions that make sense. I would say the things that make sense are things that are normally valued, right? Things like machining capacity or workforce capacity that we can bring to bear on the sub safe programs we work on, the new submarine build, things like that, that we could say we can use our certifications to bring them up to government specs faster.

And so that these are things that you would pay sort of normal amounts for and then be able to add value through our competencies. So I think those things make sense. I think when we're working on some of the more highly technical vehicle tank programs, we could be looking at some of our partners, some of the people that work as subcontractors for us or bring a unique piece of technology to the mix, whether that's more electronics or a different type of sensor technology or something like that. I think those are things that are kind of nichey maybe or a little bit bigger than nichey that make sense. What doesn't make sense is us -- I mean we've got an established brand. I don't think we need to go buy one of the big super -- what I consider overvalued flashy names just to try to buy credibility with the customer.

I don't think we need to go into that ridiculous multiple range to try to get a foot in the door. We're already there. We've got one of the strongest operational reputations in the business. They know we've been here. I mean some people forget that we've been in that government business. We're a 60-year-old company. We've been on the government side more than 40 years, so it's not like we're new to the game. We don't need to buy presence.

Keith Beckmann

Okay. Perfect. And then my second question is maybe any more color we can get around kind of the ongoing continuing resolution going on, right, with the government spending. So I'm just trying to get a sense on the potential range of outcomes for 2027, like what could be more of the low end versus the high end? And I guess, more specifically, like those awards would still be there, it's more of a function of timing rather than actually things going away. Is that the right way to think about it, right? Just kind of when things start -- sorry, I'll turn it over.

Roderick Larson

Yes, that's exactly -- and it's really the sensitivity is more on new project starts, right, continuing resolution means if you you're doing, you get to continue doing it. So I think a lot of those things, we've got a pretty good support from nearly all the awards we're doing. Some of the newer things we've won could get slowed down. On the other hand, I will say, while there's always this risk. I mean right now, I feel better about what we're hearing coming off the hill and what we're hearing about a potential resolution for a defense spending bill, for example, it seems like even for an election year, people aren't really keen to get a defense bill in place, probably not surprising given the geopolitical climate, but I'm not as worried about the defense portion of that. I think there really is a lot of cooperation going on, so I remain quite optimistic that while it's an unknown out there, and we do think it's appropriate to call caution to it or call attention to it, I do feel like we've probably got better information coming back to us than we have in past years.

Operator

Your next question comes from the line of Colby Sasso with Daniel Energy Partners.

Colby Sasso

Just on thinking about '27. Could you talk about where you see the most growth from a geographical standpoint next year?

Roderick Larson

Sure. I think it's -- a lot of it is Brazil. Of course, we still see growing we see Guyana growing to Africa. I mean, we see opportunities in the rest of Africa. I think those are good. One of the things we call out is the Gulf of Mexico. It's just -- the Gulf of Mexico already is going down. We got to see how much resilience the Gulf of Mexico has -- and that's why that we'd be keeping around. Mike, what else would you call on? .

Michael Sumruld

I think what rest of Africa is a good one, Mozambique seeing a lot of activity, working back in, again, all across West Africa. It's a challenging base to learn, but we've done work there for years and years and got some more mind of there as well.

Roderick Larson

Yes. I mean, I don't know that everybody realizes, but could have as much drilling activity as Guyana within a year or 2, so.

Colby Sasso

And just another follow-up. How are you thinking about inflation across your supply chain? And this is dragging on margins at all today? And if so, how long will this take to ultimately push through your customer base? And could it potentially be a tailwind for margins in '27?

Roderick Larson

I don't -- I can't call that out as a huge factor. Colby. I mean, most of it -- where we see the biggest part of it, it's been manufactured products, obviously, and especially with some of the bigger components that go into an umbilical. Those things are almost always price adjusted or cost adjusted into the price. Those we are covered on the same product, I mean, same -- in the same bid. So that's not such a big one. It would be the biggest impact of it, if it weren't. And then the rest of it is within -- it's got within our reach. I mean we're able to mitigate a lot of it. For example, what shows up in R&M in the ROV business. We can mitigate that just by being more efficient, being more careful about where we're buying things, how we're sending them around the world. I think that's -- the mitigations have been pretty effective.

Labor rates are always probably the thing that we're most sensitive to, and so I would say that the customers are pretty good about recovering labor rates because they value their crews. If they like the people who work for them, they are very well -- I think there they're very well aware of what's going on in the labor market because they have to deal with it to some degree as well. And so getting adjustments for labor rates has been pretty effective so far. So I can't hang a lot of things off on that, although the more efficient we get, the smarter we get operating the business, all of those things can help us get the cost reductions to make us more competitive.

Michael Sumruld

Yes, the escalation cost is under contracts really help on the labor side plus the more we do from a remote operating perspective, I think, also reduces our footprint and our cost. I think we just haven't had a major issue that I can tell from inflation right now so I don't not overly concerned about it.

Operator

[Operator Instructions] Your next question comes from the line of James West with Melius Research.

Unknown Analyst

Rod, you talked about Ghana growing other Africa growing was highlighted as well. What are you seeing outside of Brazil, Africa, maybe a little bit of Gulf of Mexico. What about Mediterranean offshore North Africa, what are you guys seeing in those regions of the world? Just this gas, heavy areas where gas is just becoming a much more important product these days. Just curious your thoughts there.

Roderick Larson

I think the Eastern man definitely is still a lot of opportunity kind of tempered a little bit by activity or by that geopolitical situation over there. But there's still a lot of a lot of interest. I mean you've got E&I working over there on the Chevron projects others. So I think that's one that's got a lot of upside potential to your point. One of our really good products was offshore Egypt. So we had a great installation project there this year, and I think we see opportunity for more of that kind of work. So yes, the Med's an interesting one. We don't call it out because it's a little more -- I would call it a little more sporadic, but it could be meaningful, for sure.

Yes. And then Norway is always an interesting one. Norway is persistent. And so as Equinor starts to find things, we see -- the other thing we see from Norway is the potential for a lot of subsea tiebacks. They've talked about improving seismic resolution through AI, and that can light up some spots and existing fields that make really good opportunities for subsea tiebacks. We love those because we can do a full installation project there and provide the umbilical and a lot of engineering. So I think the more we see tiebacks in the near future, which again, if we have a continued strong commodity price, tieback are one of those things that's easiest to get on the budget. So that could affect Norway for sure. But if that becomes sort of a greater interest, it definitely could affect the independence of the Gulf of American.

Unknown Analyst

Okay. Okay. Got it. Very helpful. And then maybe follow-up question, not necessarily related to that. But how are you thinking about capital allocation on your oil and gas business versus your military business, which has been growing because there's kind of capital cycles -- upside capital cycle was happening in both areas right now. And so you've got a, I would think kind of balance where you see the best returns, but I'm kind of curious how you're thinking about that.

Roderick Larson

I think there's still opportunities. When we talk about -- Mike mentioned earlier in one of the questions about more remote work, being able to do more remote work being able to do work differently, actually things that we could do that improve the efficiency of both the work we do and the customers' work. I mean there's a chance to be a little disruptive with technology. And so I think investments in the energy side are going to make sense. We're going to find things that make a lot of economic sense, both from their value stand-alone but also from the value they bring to protecting our core, right, things that we enhance RV operations with that make us even stronger within those pieces of the business are really makes sense.

Subsea inspection -- let me use that one as an example. Doing more and more digital twin modeling and building a digital twin from ROV video and then using that to devise a risk-based inspection program for subsea assets as we try to keep subsea assets going longer, tying back more things to existing infrastructure, stuff like that, keeping TMPs running longer. I mean all of these things require more inspection while in service. And the more of that we can do with technology. And of course, there's a lot of really cool technology out there that can be levered here. I think that's the kind of stuff that really does warrant continued investment inside the energy business.

Operator

There are no further questions at this time. I will now turn the call back to Rod Larson for closing remarks.

Roderick Larson

Well, since there are no more questions, I'll just wrap up by thanking everybody for joining the call. This concludes our third quarter 2026 conference call.

Operator

Thank you for attending. You may now disconnect.