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

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Transcription:

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.

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

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

Leading Market Position Remotely Operated Vehicles Ownership Drill Support Market Share OII - 304 OII 167 35% 59% Worldwide Fleet 877 Vehicles* 283 Floating Rigs Contracted** Source: OII Estimates - * December 2013; IHS Petrodata -**March 2014

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

Earnings Per Share Guidance 2014 Estimate $3.90 - $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 2008 2009 2010 2011 2012 2013 2014E OII 2014 Guidance Range as of April 23, 2014

Combined EPS OSX Companies Excluding OII $80 Actual Consensus Estimate are ngs per Sh Earni $60 $40 $20 $0 2008 2009 2010 2011 2012 2013 2014E Based on First Call Actuals and Mean Estimates as of April 30, 2014

Relative EPS Performance To Recent 2008 OSX Peak 150% OII OSX w/o OII 100% 50% 0% -50% 2008 2009 2010 2011 2012 2013 2014E Based on First Call Actuals and Mean Estimates as of May 30, 2014

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

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

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,

Worldwide Deepwater Capex Forecast to More Than Double $ in billions DW Capex in Billions $300 $250 $260 $200 $150 $100 $113 $50 $0 2009-2013 2014-2018 Source: Douglas-Westwood, January 2014

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

Floating Rig Demand Ye ear-end Co ontracted Fl loating Rigs 400 350 300 250 200 150 147 90% Increase In Demand Since 2003 282 100 at End of 2013: 314 Rigs in Fleet, 90% Fleet Utilization. Source: IHS-Petrodata at December 31, 2013

Floating Rig Demand With 5-Year Projection, Assuming 50 Rigs Retired Ye ear-end Co ontracted Fl loating Rigs 400 350 300 250 200 150 Assuming 10 Rigs Per Year are Retired and 90% Rig Fleet Utilization 282 Up > 45 17% Growth 329 100 @ End of 2013: 314 Rigs in Fleet, 90% Fleet Utilization. Source: IHS-Petrodata at March 31, 2014

Floating Rig Demand 5-Year Averages, Assuming 50 Rigs Retired & 90% Utilization Ye ear-end Co ontracted Fl loating Rigs 400 350 300 250 200 150 185 250 305 325 Up 75 30% Growth 100 @ End of 2013: 314 Rigs in Fleet, 90% Fleet Utilization. Source: IHS-Petrodata at March 31, 2014

Outlook for ROV Demand on Vessels 3.5 Global RO OVs per Floa ating Rig 3.0 2.5 20 2.0 1.5 25 2.5 2.9 1.0 Year End Source: Oceaneering Estimates and IHS-Petrodata

Subsea Hardware Capex Forecast to Increase 80% $ in billions $125 $100 $117 $75 $50 $65 $25 $0 2009-2013 2014-2018 Source: Douglas-Westwood, May 2014

Deepwater Fields Backlog Undeveloped Discoveries Fields 600m 600 500 400 300 200 100 0 2009 2010 2011 2012 2013 Source: IHS Petrodata

Offshore Construction Backlog Saipem, Technip, and Subsea 7 in billions 30 25 20 15 10 5 0 2009 2010 2011 2012 2013 Source: Morgan Stanley Estimates and Company Filings

Subsea Tree Orders Forecast at Historically High Levels 800 700 600 500 400 300 200 100 Source: Quest Offshore Resources Mean Case Forecast, May 2014

Subsea Installations Excluding Brazil Forecast at Historically High Levels 600 60% Growth 500 Installation ns 400 300 265 230 365 200 100 0 Source: Quest Offshore Resources Mean Case Forecast, May 2014

Subsea Completions In Service, Excl BRZ vs. Subsea Products Operating Income (SSP Op Inc) 5000 Annual SSP Op Inc in millions $250 4000 $200 3000 $150 2000 $100 1000 $50 0 $0 SS Completions SSP Op Inc Source: Quest Offshore Resources & OII SEC Filings, May 2014

Subsea Completions In Service, Excl BRZ Forecast at Historically High Levels 5000 Up 1000 > 30% Growth 4000 3000 2000 1000 0 Source: Quest Offshore Resources & OII SEC Filings, May 2014

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

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

Supplemental Financial Information

EBITDA in millions Actual Low Estimate High Estimate $1,000 $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 2008 2009 2010 2011 2012 2013 2014E* *2014 - $850MM - $890MM Based on OII EPS Guidance as of April 23, 2014 See Next Slide For Non-GAAP Reconciliation to Net Income

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, 2008 2009 2010 2011 2012 2013 2014E 2014E (in millions of $) LOW HIGH Net Income 199.4 188.4 200.5 235.7 289.0 371.5 425 445 Depreciation & Amortization 115.0 122.9 153.7 151.2 176.5 202.2 230 240 Subtotal 314.4 311.3 354.2 386.9 465.5 573.7 655 685 Interest Expense/Income, Net 12.6 7.1 5.4.2 2.3 1.6 Income Tax Expense 107.8 101.4 104.7 102.2 132.9 170.8 195 205 EBITDA 434.8 419.8 464.3 489.3 600.7 746.2 850 890

OII Balance Sheet (in millions) Dec 31, Dec 31, Dec 31, Dec 31, Dec 31, Mar 31, 2009 2010 2011 2012 2013 2014 Equity $1,224 $1,390 $1,558 $1,815 $2,043 $2,090 Debt 120 0 120 94 0 90 Cash 162 245 106 121 91 106 Debt/Cap 9% 0% 7% 5% 0% 4%

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

Supplemental Market Information

Oilfield ROV Fleet Ownership Profile - December 2013 35% OII - 304 OII Subsea 7 Fugro DOF Subsea Saipem C-Innovations Helix Technip Other 877 Vehicles Source: OII Estimates

OII ROV Fleet Geographic Profile - March 2014 34 33 35 51 76 85 GOM Africa Norway Brazil Asia/Pac Other 314 Vehicles

OII ROV Fleet Size od End Vehicle Co ount at Peri 350 300 250 200 150 100 50 0 125 314 March 31, 2014

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

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

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

Subsea Products Backlog At Period End in millions $1,000 $800 $600 $400 $200 $0 2009 2010 2011 2012 2013 2014 March 2014

Subsea Tree Orders Forecast at Historically High Levels 800 700 Up 215 55% Growth 610 600 500 400 300 200 100 430 395 Source: Quest Offshore Resources Mean Case Forecast, May 2014

Subsea Tree Orders Excluding BRZ Forecast at Historically High Levels 75% Growth 500 465 400 355 Tree Orde ers 300 200 265 100 0 Source: Quest Offshore Resources Mean Case Forecast, May 2014

Subsea Installations Forecast at Historically High Levels 700 Up 165 55% Growth 600 500 455 400 300 305 290 200 100 Source: Quest Offshore Resources Mean Case Forecast, May 2014

Subsea Completions In Service vs. Subsea Products Operating Income (SSP Op Inc) 5000 Annual SSP Op Inc in millions $250 4000 $200 3000 $150 2000 $100 1000 $50 0 $0 SS Completions SSP Op Inc Source: Quest Offshore Resources & OII SEC Filings, May 2014

Subsea Completions In Service Forecast at Historically High Levels Up 1375 > 30% Growth 6000 5000 4000 3000 2000 1000 0 Source: Quest Offshore Resources & OII SEC Filings, May 2014

Umbilical Products Thermoplastic Hose Umbilicals Steel Tube Umbilicals

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

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

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