Q4 Financial Presentation 2017 DOF ASA

Transcription

1 Q4 Financial Presentation 2017 DOF ASA

2 Highlights Group 2

3 Highlights EBITDA Q4 MNOK 649 (excl hedge accounting) Refinancing completed in DOF and DOF Subsea: Private Placement and repair issue NOK 700 million Extended ownership in DOF Subsea Extension maturity DOFSUB07 Extension soft terms DOF Rederi and credit facility in DOF Average utilization fleet 76% in Q4 Skandi Darwin on-hire on a 5-year contract with Shell at the Prelude field in Australia NOK 5 billion in firm backlog for 2018 All numbers based on management reporting 3

4 Increased ownership in DOF Subsea at attractive terms In December, DOF ASA increased its ownership in DOF Subsea from 51% to 65% at attractive terms LT Chartering growth from 2x newbuilds with 8-year contracts Invested NOK 500 million of new equity at NOK 1.26 billion pre-money pricing, compared to book value of NOK 6 billion Increasing ownership by 14%-points at NOK ~4.5 billion discount to book EBITDA (excl. sales gains) NOK million ~9 vessels in operation by Q1 19 DOF Subsea has a fleet of state-of-the-art subsea vessels and one of the world s largest owned fleets of work ROVs Long-term Chartering 9x high-end construction vessels (whereof 6 in JV with TechnipFMC), average remaining contract tenor ~5 years, 76% EBITDA margin in 2017 and NOK 12.4 billion in backlog at the end of the year Subsea IMR Projects 18x vessels, ~1 200 employees and NOK 3.7 billion in backlog at the end of the year DOF Subsea has an aggregate firm backlog of NOK 16.1 billion compared to net debt of NOK 11.8 million Capex NOK 1.9 billion next 18 months (two JV vessels with TechnipFMC with BNDES financing) Subsea IMR Projects bottom of the cycle EBITDA (excl. sales gains) NOK million

5 DOF ASA, a global player Our vessels and subsea equipment Subsea 31 AHTS 20 PSV 16 Total fleet 67 ROV / AUV billion backlog Approx employees 67 vessels Positioned globally Head office in Norway Operating from 6 continents 20 offices near key O&G markets 67 vessels globally Total of 3,953 employees Subsea employees Supply employees

6 DOF Group overview Contract backlog and debt Fleet Firm contracts: NOK 23 billion Options: NOK 33 billion Net debt**: NOK 20.5 billion Remaining capex: NOK ~1.9 billion **per Global organization Head office in Norway Regional offices in Australia, Singapore, UK, USA, Canada, Angola, Argentina and Brazil Group fleet of 67 vessels (including 2 JV newbuilds, 1 chartered-in vessel and 3 management vessels) Whereof 39 vessels owned by DOF Rederi and Norskan; 24 vessels are owned by DOF Subsea, 3 vessels under management Total market value of owned vessels in operation NOK ~ 32 billion based on ship broker valuations Average age fleet of 9.1 years (value adjusted average age of 6.1 years) Assets 67 vessels 71 ROVs Subsea AHTS PSV Chartered Subsea Vessels Total employees Subsea employees: Marine personnel: Backlog Firm contracts: NOK 23 billion Options: NOK 33 billion 6

7 NOK million Positioned to deliver Group backlog at Backlog DOF Supply / DOF Subsea at Thereafter Option Firm Total value backlog (firm & options) from 2020 and onwards is MNOK 42,789 (As per ) 7

8 DOF Supply Highlights Contracts New contracts in the Atlantic region Skandi Foula (PSV) awarded 2 month contract + option in the Black Sea Skandi Olympia (RSV) extended with Fugro until September 2018 Skandi Gamma (PSV) extended until March Skandi Iceman (AHTS) awarded days in West-Africa securing work parts of the winter season Skandi Captain (PSV) awarded 1-year contract with Peterson, commencement in February 2018 New contracts in Brazil 265 days extension Skandi Admiral (AHTS) contract, from June 2018 New contract in the Asia Pacific Skandi Sotra (PSV) secured 75 days with Chevron in Australia Vessels sold Skandi Møgster (AHTS) built in 1998 sold in November Skandi Marstein (PSV) built in 1996, sold in December 8

9 DOF Subsea Highlights Contracts New contracts Skandi Darwin (Subsea) commenced its long-term IRM contract on the Shell Prelude FLNG facility in Australia in November Skandi Neptune (Subsea) and Skandi Constructor (Subsea) extended in the Atlantic region until the beginning of April Harvey Deep Sea (MPSV) and Skandi Achiever (DSV) secured 135 days for the provision of survey, ROV and vessel services in the Gulf of Mexico. Both vessel secured utilization in Q1 Skandi Hercules (AHTS/Subsea) and Skandi Singapore (DSV) secured utilization in Australia in Q Skandi Niteroi ((PLSV) awarded 2-months contract with McDermott on the Atlanta Project for Queiroz Galvão with commencement in November Skandi Skansen s (AHTS/Subsea) contract with TechnipFMC extended and a new contract signed securing high utilization in the first four months of the year Skandi Salvador (Subsea) awarded short-time contract with Saipem in Brazil Two ROV contracts with Petrobras, to be installed onboard Skandi Angra and Skandi Paraty (AHTS) Extension two ROV contracts with Petrobras, installed on Skandi Iguacu and Skandi Urca (AHTS) 9

10 Two newbuildings remaining with 8-year contracts Co-owned 50/50 with TechnipFMC Vessel Yard Delivery Type Contract Financing Skandi Recife Vard Brazil Q PLSV 8 years Petrobras Loan agreement signed with BNDES Skandi Olinda Vard Brazil Q PLSV 8 years Petrobras Loan agreement signed with BNDES 10

11 Vessels added to the fleet Opportunities in a challenging market Agreement with the new owner for management and operation of three vessels. Options to purchase vessels at a price corresponding to the outstanding debt (approx % of historical build costs). Skandi Hera Built: 2009 LOA: 93.8 m Crane: prepared for 250 t Bollard pull: 263 t Skandi Hera will give good exposure in both AHTS and Subsea markets. Skandi Darwin Built: 2012 LOA: 93.8 m Crane: 70 t Accommodation: 60 persons To be utilized for the Shell Prelude IMR contract in the Asia Pacific region. Skandi Bergen Built: 2010 LOA: 87.4 m Bollard pull: 250 t Skandi Bergen is a well-regarded vessel in the Asia Pacific region but can also be utilized in the South America or Atlantic regions. 11

12 Financials Management Reporting 12

13 DOF has tightened control of DOF Subsea and extended the runway 1) DOF ASA raised NOK 500 million of new equity in a private placement in November ) Increased ownership in DOF Subsea AS and refinanced bond debt Fully subscribed NOK 500 million DOF Subsea equity issue, increasing ownership from 51% to 65% Pre-money equity pricing of NOK 1.26 billion New equity coupled with extension of NOK 508 million bond (DOFSUB07) until Oct 2019 (NOK 100 million) and May 2020 (NOK 408 million) 3) Extended runway of DOF Rederi (the non-brazilian supply vessel part) Extension soft terms on NOK 3,8 bn facility until end of maturity in 2021, estimated cash impact of NOK 550 million 4) Extended runway of DOF Extension credit facility in holding until ) Subsequent offering of up to NOK 202 million completed in February 2018 DOF ASA is attractively positioned: 70% of EBITDA is from Subsea segment, with high contract coverage and upside from Subsea IRM projects 24% of EBITDA is from the Brazilian activity, long term contracts, local flag privileges and long-term funding from BNDES 6% of EBITDA is from the offshore supply vessel activity (PSV & AHTS outside Brazil) 13

14 Main Financial Highlights EBITDA Q4 MNOK 649 (excl hedge) Average utilization total fleet 76% in Q4 82% PSV segment 67% AHTS segment 80% Subsea segment (project fleet 75%) EBITDA ex Hedge Q EBITDA ex Hedge Q % 45 % 62% 55 % DOF Supply DOF Supply DOF Subsea DOF Subsea Comments to highlights Performance DOF Subsea EBITDA: MNOK 402 DOF Supply EBITDA: MNOK 247 Operations Avg. utilization of DOF Subsea fleet: 78% Avg. utilization of DOF Supply fleet: 75% Five vessels in lay-up end December Reduced earnings and variable utilization in the North Sea spot market, stable utilization in Brazil, and variable utilization subsea IRM projects in the various regions All numbers based on management reporting DOF Supply is DOF Rederi and Norskan consolidated 14

15 Profit & Loss Q All figures in NOK million Q Q Operating income Operating expenses Net profit/loss from TS and JV Net gain on sale of vessel EBITDA before hedge Hedge operating income Operating profit - EBITDA Depreciation Impairment Operating profit- EBIT Financial income Financial costs Net currency gain/loss Net profit/loss before unrealized currency Net unrealized currency gain/loss Net unrealized gain/loss on market instr Profit/loss before tax Tax Net profit/loss According to management reporting Main events in Q4 Operational performance: PSV: Stable utilization spot fleet in the North Sea One vessel in lay-up by end Q4 AHTS: Stable earnings and utilization in Brazil Reduced earnings and utilization in spot fleet in the North Sea Low utilization in APAC Four vessels in lay-up by end Q4 Subsea: Variable utilization Subsea IRM fleet Improved activity in APAC and in North America Lower activity in the Atlantic and Brazil region Impairment represent a drop in values in the PSV and small-medium sized AHTS and Subsea fleet 15

16 Segment reporting Q PSV AHTS Subsea Total Amounts in NOK million Q Q Q Q Q Q Q Q Operating income Gain on sale of tangible assets Operating result before depreciation and impairment (EBITDA) Depreciation Impairment Operating result (EBIT) EBITDA margin 17 % 28 % 41 % 50 % 30 % 33 % 31 % 36 % EBIT margin -75 % -59 % -3 % 14 % 11 % 3 % -1 % -1 % According to management reporting EBITDA Q EBITDA Q % 6 % 24 % 60 % 9 % 31 % PSV AHTS Subsea PSV AHTS Subsea 16

17 Balance as of Amounts in NOK million ASSETS Tangible assets Goodwill Deferred taxes Investment in associated and joint ventures Other non-current receivables Non-current assets Receivables Cash and cash equivalents Current assets Total assets EQUITY AND LIABILITIES Subscripted equity Retained equity Non-controlling equity Equity Non-current interest bearing debt Other non-current liabilities Non-current liabilities Current part of interest bearing debt Other current liabilities Current liabilities Total equity and liabilities According to management reporting Main events balance sheet YTD Non current assets: Two newbuilds delivered and on-hire firm contracts YTD Three vessels sold two in Q4 Current assets: Operating cash flow MNOK 1,150 Investments MNOK -1,292 Financing activity MNOK 218 Equity: Convertible bond loan MNOK 275 by end Q4 Non current liabilities: Two new loans drawn upon delivery newbuild DOFSUB08, USD 175 million, drawn in February Extension DOFSUB07 until 2019/2020 Current liabilities: Short term IBD: Amortisation MNOK 1,979 (next 12 months) Credit facilities and accrued interests No balloons before

18 DOF Group is reducing net debt quarter by quarter NOK million DOF Supply has reduced net debt from NOK 9.6 billion post the restructuring, to 8.9 billion DOF Subsea has reduced net debt from NOK 12.0 billion Q3 16 to Q4 17 NOK 11.6 billion Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 DOF Supply DOF Subsea (ex deliveries) DOF Subsea newbuilds w/contract All numbers based on management reporting DOF Supply is DOF Rederi and Norskan consolidated 18

19 DOF Subsea 19

20 DOF Subsea has two business segments DOF Subsea Group Subsea IMR Projects Long-term Chartering 1) Framework agreements Engineering capabilities Opex spending Long-term charters Vessel capabilities Capex spending Revenues ) EBITDA ) Firm backlog 4) Revenues ) EBITDA ) Firm backlog 4) NOK million NOK 323 million NOK 3.7bn NOK million NOK million NOK 12.4bn ~10% margin* ~76% margin Employees Q vessels in operation 5) Q vessels in operation Q newbuilds Q4 17 * Reduced EBITDA margin due to one-off events in North America and APAC 1) Note: Long-term Chartering comprises 5 PLSVs in operation, 2 PLSVs under construction, Skandi Acergy and Skandi Patagonia 4) Note: Firm backlog as at end of Q ) Note: According to management reporting 3) Note: According to management reporting 5) Note: Including 3 chartered-in vessels

21 DOF Subsea Long-term chartering fleet provides solid backlog Subsea vessel Built year Current client Firm end Option end ~5 years Average contract coverage NOK 0.8bn and 1.0bn EBITDA contribution in 2016 and and 7 Operational vessels end of ) and ) 9 Vessels in operation from Q1 19 1) Note: Skandi Acu delivered August ) Note: Skandi Buzios delivered April

22 DOF Subsea Significant upside potential from Subsea IMR Projects Strong influx of new contracts commencement of 3 long-term contracts and framework agreements in 2017 Gaining market share and reputation in core offshore regions a key enabler for access to new project opportunities Increasing opportunities for repeatable revenue related to additional project scope under existing contracts IMR market expected to grow due to aging subsea infrastructure and low spending during recent market downturn Leverage significant access to highly-skilled subsea personnel in order to position for expected market upturn in 2018/2019 EBITDA (excl. sales gains) NOK million Commencement in

23 NOK billion DOF Subsea Maintained strong backlog Current backlog at 2014 levels Book-to-bill of ~1.0x from Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Sum of Firm Sum of Options Majority of firm contract backlog with investment grade companies Firm contract backlog in NOK has been relatively steady over time Current firm contract backlog equals ~3x actual 2016 revenue Majority of firm backlog has high EBITDAmargin 23

24 Outlook Actuals in line with guidance for 2017 (MNOK MNOK 2 800) Firm backlog of NOK 5 billion in 2018 The refinancing completed in February has extended the Group s runway to sustain a continuing challenging markets The two remaining newbuild to be delivered in 2018 and 2019 are committed on firm contracts Increased tendering activity and signs of higher activity within some regions and segments. Still uncertainty on where the market is heading. High uncertainty to guide for 2018, best estimate today is an operational EBITDA of MNOK MNOK

25 Presented by Mons Aase Hilde Drønen Thank you - CEO - CFO

26 DISCLAIMER This presentation by DOF ASA designed to provide a high level overview of aspects of the operations of the DOF ASA Group. The material set out in the presentation is current as at 23 February This presentation contains forward-looking statements relating to operations of the DOF ASA Group that are based on management s own current expectations, estimates and projections about matters relevant to DOF ASA s future financial performance. Words such as likely, aims, looking forward, potential, anticipates, expects, predicts, plans, targets, believes and estimates and similar expressions are intended to identify forward-looking statements. References in the presentation to assumptions, estimates and outcomes and forward-looking statements about assumptions, estimates and outcomes, which are based on internal business data and external sources, are uncertain given the nature of the industry, business risks, and other factors. Also, they may be affected by internal and external factors that may have a material effect on future business performance and results. No assurance or guarantee is, or should be taken to be, given in relation to the future business performance or results of the DOF ASA Group or the likelihood that the assumptions, estimates or outcomes will be achieved. While management has taken every effort to ensure the accuracy of the material in the presentation, the presentation is provided for information only. DOF ASA, its officers and management exclude and disclaim any liability in respect of anything done in reliance on the presentation. All forward-looking statements made in this presentation are based on information presently available to management and DOF ASA assumes no obligation to update any forward looking- statements. Nothing in this presentation constitutes investment advice and this presentation shall not constitute an offer to sell or the solicitation of any offer to buy any securities or otherwise engage in any investment activity. You should make your own enquiries and take your own advice (including financial and legal advice) before making an investment in the company's shares or in making a decision to hold or sell your shares. 26