Marvin J. Migura. Oceaneering International, Inc. Global Hunter Securities 100 Energy Conference June 24, 2014 Chicago, IL. Safe Harbor Statement

Transcription

1 Global Hunter Securities 100 Energy Conference June 24, 2014 Chicago, IL Marvin J. Migura Executive Vice President Oceaneering International, Inc. Safe Harbor Statement Statements we make in this presentation that express a belief, expectation, or intention are forward looking. Forward-looking statements are generally accompanied by words such as estimate, project, predict, believe, expect, anticipate, plan, forecast, budget, goal, or other words that convey the uncertainly of future events or outcomes. These forward-looking statements are based on our current information and expectations that involve a number of risks, uncertainties, and assumptions. Among the factors that could cause the actual results to differ materially from those indicated in the forward-looking statements are: industry conditions, prices of crude oil and natural gas, our ability to obtain and the timing of new projects, and changes in competitive factors. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, actual outcomes could vary materially from those indicated. For additional information regarding these and other factors, g g, see our periodic filings with the Securities and Exchange Commission, including our most recent Reports on Forms 10-K and 10-Q.

2 WHY OII? Leveraged to Deepwater and Subsea Completions Secular Growth Leading Market Positions ROVs and Specialty Subsea Products Good Project Execution Excellent Earnings, Liquidity and Cash Flow

3 Leveraged to Deepwater Projects Take Years to Develop Largely Oil Reservoirs With High Production Flow Rates Well Capitalized Customer Base Investment Based on Long-Term Commodity Price

4 Leading Market Position Remotely Operated Vehicles Ownership Drill Support Market Share OII OII % 59% Worldwide Fleet 877 Vehicles* 283 Floating Rigs Contracted** Source: OII Estimates - * December 2013; IHS Petrodata -**March 2014

5 Leading Market Position Specialty Subsea Products Umbilicals Tooling & Subsea Work Systems Installation and Workover Control Systems Subsea Hardware

6 Earnings Per Share Guidance 2014 Estimate $ $4.10 are ngs per Sh Earni $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 Actual Low Estimate High Estimate E OII 2014 Guidance Range as of April 23, 2014

7 Combined EPS OSX Companies Excluding OII $80 Actual Consensus Estimate are ngs per Sh Earni $60 $40 $20 $ E Based on First Call Actuals and Mean Estimates as of April 30, 2014

8 Relative EPS Performance To Recent 2008 OSX Peak 150% OII OSX w/o OII 100% 50% 0% -50% E Based on First Call Actuals and Mean Estimates as of May 30, 2014

9 EPS Guidance Oilfield Business Segment Outlook SEGMENT OPERATING INCOME 2014 ROV >2013 Subsea Products >2013 Subsea Projects >2013 Asset Integrity >2013

10 Excellent Cash Flow & Liquidity EBITDA of $850 MM to $890 MM Expected in 2014 $746 MM in 2013 Ample Resources to Invest in Growth At March 31, 2014: $106 MM Cash $90 MM Debt $2.1 B Equity EBITDA Reconciliation to Net Income is in Supplemental Financial Information Slides

11 Long-Term Deepwater Outlook Major Source of Future Oil Supply Exploration Success Bodes Well for the Future Drilling Intensity is Rising Source: ExxonMobil and Deutsche Bank,

12 Worldwide Deepwater Capex Forecast to More Than Double $ in billions DW Capex in Billions $300 $250 $260 $200 $150 $100 $113 $50 $ Source: Douglas-Westwood, January 2014

13 5-Year OII Outlook Global Demand Growth Deepwater Drilling Field Development Inspection, Maintenance, and Repair (IMR)

14 Floating Rig Demand Ye ear-end Co ontracted Fl loating Rigs % Increase In Demand Since at End of 2013: 314 Rigs in Fleet, 90% Fleet Utilization. Source: IHS-Petrodata at December 31, 2013

15 Floating Rig Demand With 5-Year Projection, Assuming 50 Rigs Retired Ye ear-end Co ontracted Fl loating Rigs Assuming 10 Rigs Per Year are Retired and 90% Rig Fleet Utilization 282 Up > 45 17% Growth 329 End of 2013: 314 Rigs in Fleet, 90% Fleet Utilization. Source: IHS-Petrodata at March 31, 2014

16 Floating Rig Demand 5-Year Averages, Assuming 50 Rigs Retired & 90% Utilization Ye ear-end Co ontracted Fl loating Rigs Up 75 30% Growth End of 2013: 314 Rigs in Fleet, 90% Fleet Utilization. Source: IHS-Petrodata at March 31, 2014

17 Outlook for ROV Demand on Vessels 3.5 Global RO OVs per Floa ating Rig Year End Source: Oceaneering Estimates and IHS-Petrodata

18 Subsea Hardware Capex Forecast to Increase 80% $ in billions $125 $100 $117 $75 $50 $65 $25 $ Source: Douglas-Westwood, May 2014

19 Deepwater Fields Backlog Undeveloped Discoveries Fields 600m Source: IHS Petrodata

20 Offshore Construction Backlog Saipem, Technip, and Subsea 7 in billions Source: Morgan Stanley Estimates and Company Filings

21 Subsea Tree Orders Forecast at Historically High Levels Source: Quest Offshore Resources Mean Case Forecast, May 2014

22 Subsea Installations Excluding Brazil Forecast at Historically High Levels % Growth 500 Installation ns Source: Quest Offshore Resources Mean Case Forecast, May 2014

23 Subsea Completions In Service, Excl BRZ vs. Subsea Products Operating Income (SSP Op Inc) 5000 Annual SSP Op Inc in millions $ $ $ $ $50 0 $0 SS Completions SSP Op Inc Source: Quest Offshore Resources & OII SEC Filings, May 2014

24 Subsea Completions In Service, Excl BRZ Forecast at Historically High Levels 5000 Up 1000 > 30% Growth Source: Quest Offshore Resources & OII SEC Filings, May 2014

25 5-Year Deepwater Outlook What To Expect Along The Way Some Project Approvals May Continue Moving to the Right Approved Projects Cost Overruns Production Start-Up Delays Technical Challenges Sheer Volume of Projects Will Still Drive Growth

26 OII Summary Diversified OFS Company Leading Market Positions in Technical Niches Leveraged to Deepwater and Subsea Completions Excellent Earnings, Liquidity and Cash Flow

27

28 Supplemental Financial Information

29 EBITDA in millions Actual Low Estimate High Estimate $1,000 $900 $800 $700 $600 $500 $400 $300 $200 $100 $ E* * $850MM - $890MM Based on OII EPS Guidance as of April 23, 2014 See Next Slide For Non-GAAP Reconciliation to Net Income

30 EBITDA Reconciliation to Net Income Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-gaap financial measurement. Oceaneering s management uses EBITDA because we believe that this measurement is a widely accepted financial indicator used by investors and analysts to analyze and compare companies on the basis of operating performance, and that this measurement may be used by some investors and others to make informed investment decisions. You should not consider EBITDA in isolation from or as a substitute for net income or cash flow measures prepared in accordance with generally accepted accounting principles or as a measure of profitability or liquidity. EBITDA calculations by one company may not be comparable to EBITDA calculations made by another company. The following table provides a reconciliation between net income (a GAAP financial measure) and EBITDA (a non-gaap financial measure) for Oceaneering s historical and projected results on a consolidated basis for the periods indicated: Period Ended December 31, E 2014E (in millions of $) LOW HIGH Net Income Depreciation & Amortization Subtotal Interest Expense/Income, Net Income Tax Expense EBITDA

31 OII Balance Sheet (in millions) Dec 31, Dec 31, Dec 31, Dec 31, Dec 31, Mar 31, Equity $1,224 $1,390 $1,558 $1,815 $2,043 $2,090 Debt Cash Debt/Cap 9% 0% 7% 5% 0% 4%

32 Business Segments Revenue Operating Income 7% 2% 8% 15% 31% 12% 46% 16% 31% 32% YTD March 2014 ROV Subsea Products Subsea Projects Asset Integrity Adtech

33 Supplemental Market Information

34 Oilfield ROV Fleet Ownership Profile - December % OII OII Subsea 7 Fugro DOF Subsea Saipem C-Innovations Helix Technip Other 877 Vehicles Source: OII Estimates

35 OII ROV Fleet Geographic Profile - March GOM Africa Norway Brazil Asia/Pac Other 314 Vehicles

36 OII ROV Fleet Size od End Vehicle Co ount at Peri March 31, 2014

37 Oilfield ROV Drill Support Market March 2014 OII Subsea 7 59% Fugro Sonsub Other 283 Contracted Floating Rigs Source: IHS-Petrodata and OII Estimates

38 ROV Pricing and Fleet Utilization $11,000 Revenue / Day on Hire Fleet Utilization 100% $9,000 90% $7,000 80% $5,000 70% $3,000 60% $1,000 50% *YTD March 2014

39 High-Spec, Non-PBR Brazil Rig Fleet 116 Existing Rigs Under Contract OII ROV Contracts t on 79% 72 Rigs On Order Visibility of Significant Rig Fleet Growth OII Expects to Continue as Dominant ROV Provider OII ROV Contracts on 17 of 19 Awards 53 Remaining ROV Contract Opportunities Only 5 rigs have drilling contracts Source: IHS-Petrodata Data & OII Estimates, March 31, 2014

40 Subsea Products Backlog At Period End in millions $1,000 $800 $600 $400 $200 $ March 2014

41 Subsea Tree Orders Forecast at Historically High Levels Up % Growth Source: Quest Offshore Resources Mean Case Forecast, May 2014

42 Subsea Tree Orders Excluding BRZ Forecast at Historically High Levels 75% Growth Tree Orde ers Source: Quest Offshore Resources Mean Case Forecast, May 2014

43 Subsea Installations Forecast at Historically High Levels 700 Up % Growth Source: Quest Offshore Resources Mean Case Forecast, May 2014

44 Subsea Completions In Service vs. Subsea Products Operating Income (SSP Op Inc) 5000 Annual SSP Op Inc in millions $ $ $ $ $50 0 $0 SS Completions SSP Op Inc Source: Quest Offshore Resources & OII SEC Filings, May 2014

45 Subsea Completions In Service Forecast at Historically High Levels Up 1375 > 30% Growth Source: Quest Offshore Resources & OII SEC Filings, May 2014

46 Umbilical Products Thermoplastic Hose Umbilicals Steel Tube Umbilicals

47 OIE Products Tooling & Work Packages Production Control Valves Installation Workover & Control Systems Connectors & Repair Systems Field Development Hardware

48 Annual Price Performance OII vs. OSX 125% OII OSX 2014 OII down 7% OSX up 5% 75% 25% -25% -75% *Through April 30, 2014: Based on Previous Year-End Purchases

49 Cumulative Price Performance OII vs. OSX 1000% OII OSX 2014 OII down 7% OSX up 5% 850% 700% 550% 400% 250% 100% -50% *Through April 30, 2014: Based on Previous Year-End Purchases