Harvey Gulf International Marine powers into the future with America’s youngest deepwater fleet
“There’s a myth out there that Harvey is a one-man show. It's not,” declared Harvey Gulf International CEO Shane Guidry. Because the lion’s share of credit for blockbuster success is lavished on the corner office of the world’s most prominent enterprises, it’s not surprising that Guidry feels the need to deconstruct that perception. He understands on a cellular level what it takes to turn a shipping business around; one thing it never was, is, or will be is a one-person undertaking.
That’s abundantly clear in the company’s statement of purpose: “Our mission is to provide our customers excellent marine service and value while causing no harm to people, assets, or the environment and maintaining a culture of professionalism and mutual respect.”
Harvey Gulf’s management team hews to Guidry’s hands-on management philosophy, which we suspect is from where the “one-man” misnomer may have arisen. “It's not managing from a spreadsheet and numbers. It's just hands-on, spending the time to understand where the issues and problems are, and what's cost-effective so my team can go out and fix them.”
Guidry and his team of seasoned managers are currently piloting the firm into a new phase of its 70-year history. Not only is the company powering through a successful restructuring, it is expanding operations from the Gulf of Mexico to Mexico, Trinidad, and Guyana.
In a recent conversation with BOSS, he explained, “We just don't see where the Gulf of Mexico alone is going to support 60 vessels again. We're going to go back and refine, as we've done for most of our lives, just not in a huge way. We have worked simultaneously in Kenya, Mozambique, French Guiana, Trinidad, Beaufort Sea, and the U.S. GOM, so we are going to take our unmatched safety culture and operational excellence and spread our assets around.”
Harvey Gulf's young, industry-leading fleet of offshore support vessels is powered by cutting edge technology. It includes platform supply vessels and fast supply vessels that carry mission-critical cargo and crew to offshore oil rigs, FPSO tendering, multipurpose support vessels, and sub-sea construction vessels.
Each vessel is designed to meet customers’ present and future needs for their deepwater operations, offering them the large cargo capacities for offshore supply services, and the sub-sea fleet boasts the largest cranes on American flag vessels with unmatched capabilities for their offshore construction and sub-sea requirements. Many of Harvey’s vessels are equipped with Remote Operated Vehicles (ROVs) and surveying equipment for offshore and subsea construction projects, such as umbilicals, jumpers, Christmas Tree and flying Lead installations, pipeline inspection, and repair and dive support services.
Safety as strategy
The drive to make the industry safer is a key component of Harvey’s work. “Our customers have grown accustomed to our safety record, which is unmatched by any of our peers. We have the best safety record globally of any vessel company with the same asset profile that competes with us,” Guidry noted.
“We just made an undisputed five and a half years without a recordable incident, which is something that's quite unheard of. Not only were we able to do this in the height of the market in 2013 and 2014 but we continued to operate with no recordables through the downturn when morale reached an all-time low industry wide, we still didn't hurt people, assets, or the environment. Our crew members still bought into our safety culture and remain performing safe operations. We're going to extend that back globally to our customers so that we can not only perform a better, safer job, but perhaps there are areas in the world where we can implement our safety platform and share that with our competitors so the entire industry can operate safely.”
The entire fleet is ABS classed and USCG certified, and all offshore supply, fast supply, LNG, and multipurpose support construction vessels are ISM, SOLAS and DP2 certified.
“We work for all of the large independent, majors and super majors now,” Guidry pointed out, adding that the infusion of Harvey’s pioneering approach to an unmatched safety culture into the sector will be the tide that lifts all boats. “We’re bringing our safety culture to other areas where other boat companies that may not have the same safety culture and may need to be pushed a little bit. We think we will be able to enhance everybody’s safety, and make it a little more competitive on the safety side versus just pricing.”
He said recent contract awards in Mexico and Guyana point toward the acceptance of the strategy. “When we get to an area and perform much safer service, it makes everybody out there a little safer.
“Now, let me also add that our clients are very cost-conscious, with 99.2 percent uptime in the contract. Whether that contract is for 30 days, 90 days, or 120 days or a year, we're only going to have .8 percent downtime, annually.” Guidry posited that bringing that added value to Harvey’s global customers will nudge the competition to up their operating game. “We’ll have less cost due to downtime, and hope the outcome will be more successful,” he added.
“My entire organization, from crew members to my executive team, clearly understands the value of safety. They clearly understand the value of operational excellence. They clearly understand that equates to return on investment for our shareholders, and free cash flow so we can grow the company in a safer way, thus still giving raises and quality benefit packages to everyone. While still returning value to our shareholders.”
For the future, it’s all smooth sailing
In 2018, the Company completed a successful restructuring, emerging from Chapter 11 proceedings just 77 days after filing. In addition to dropping roughly $1 billion in bank debt and $400 million in partner debt, Harvey paid all unsecured claims in full.
The right-sizing effort took place earlier than initially planned. “It made a lot of sense to restructure the business early, and build up the cash on our balance sheet, which is in excess of $100 million today and growing. Our trailing EBITDA at the end of the third quarter is still $100 million, which is more than all of our U.S. public peers put together. We are stacking up cash, and we're going to be able to continue to weather the downturn no matter how long it lasts,” Guidry explained.
“As we can see, oil is sinking down into the $40s, so this downturn is going to be extended. To properly represent our lenders, which are our shareholders, we restructured the business early. We made sure the business will survive in a power industry that’s strong and healthy for many, many years to come.”
As our conversation with Guidry wound down, we asked him where he and his team are steering Harvey Gulf. “I'd like to see Harvey grow into the largest public global marine transportation company, producing the highest EBITDA returns with the lowest cost of operation, just like we've always done. But I'd like to do it in a public forum so the world can see what a really exceptional management team can do, one that's really bought into running a business every day.”
His advice for leaders striving to make the most of their time in the captain’s chair? “Whether you own your business yourself or have investors, manage the business every day, not quarterly. Manage safety every day, not quarterly. Manage operations every day and you'll be very successful. You'll be able to operate cheaper, thereby bringing a better price to your customers. Treat it like it's all yours every day, I do.”
Harvey Gulf International Marine, LLC is a marine transportation company that specializes in providing Dock Services, LNG Marine Fueling, Offshore Supply, Fast Supply, Special Purpose FPSO tendering, Multi-Purpose Support and Sub-Sea Construction Vessels for deepwater operations in the U.S. Gulf of Mexico. Harvey also operates the largest fleet of LNG powered supply vessels in the world and the only ones in this hemisphere. Harvey Gulf is founded on the premise that superior safety and operational excellence performance and safer operations provide our customers value and satisfaction.