Quarterly Presentation Q2 2018 DOF Subsea Group
DOF Subsea Group at a glance NOK 1.2bn 1) 1 190 2) 2005 NOK 15.9bn DOF Subsea Revenues Firm backlog Subsea employees Q2’18 Q2’18 worldwide Q2’18 established Integrated Modern 28 3) 71 4) Supplier of subsea State-of-the-art Subsea vessels ROVs offshore services asset base 1) Note: According to management reporting 4) Note: Including 2 AUVs DOF Subsea 2 2) Note: Excluding marine crew 3) Note: Including newbuild Skandi Olinda and chartered-in vessels Harvey Deep Sea, Harvey Subsea, Skandi Chieftain and Skandi Darwin
Global footprint Bergen Aberdeen St John’s 10 379 Houston 4 298 ATLANTIC Manila NORTH AMERICA Brunei Kuala Lumpur Singapore Luanda Jakarta Darwin Macaé Rio de Janeiro 5 221 BRAZIL Perth ASIA PACIFIC Buenos Aires Melbourne 8 292 Local operating model ensuring on-the- ground responsiveness towards clients’ needs Note: Number of employees as at end of Q2’18, excluding marine crew 1) DOF Subsea Note: Vessels in operation as at end of Q2’18, including 4 chartered -in vessels (excluding newbuild under construction) 3 2)
More than a decade of structural growth and consolidation DOF Subsea established following the Development in number of Subsea Employees 1) acquisition of Geoconsult. The Company was 2005 listed second half 2005. 1858 1667 1566 First Reserve acquires 49% of DOF Subsea, 1492 1354 which in the following is delisted from the Oslo 1278 1246 1214 1190 2008 Stock Exchange 1014 897 Large and global organisation following multiple 553 563 acquisitions from 2005-2010 337 Covus Subsea Century Subsea 2010 SWG Offshore CSL SEMAR Awarded four PLSV long-term contracts in joint 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Q2 2018 venture with TechnipFMC 2013 Development in number of vessels in operation 2) Expanding organisation on the back of several large contract awards. Number of employees and vessels peaking at 1 858 and 27, 27 27 26 2014 25 25 respectively 24 24 21 21 Focus on consolidation and streamlining of 18 business operations to improve efficiency and 16 competitiveness in weak market 2016 13 11 11 Delivery of two newbuilds entering into long-term contracts and commencement of two long-term IMR contracts 2017 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Q2 2018 Delivery of one JV newbuild entering into long- term contract and award of several long-term Owned vessels Chartered-in vessels Total contracts within both business segments 2018 1) Note: Marine crew not included DOF Subsea 4 2) Note: Newbuild not included 3) Note: Period-end numbers
Key financials 1) EBITDA 2) Revenue Firm backlog NOK million NOK million EBITDA margin NOK billion 8 000 2 500 40% 25 7 000 35% 2 000 20 6 000 30% 5 000 25% 1 500 15 4 000 20% 1 000 10 3 000 15% 2 000 10% 500 5 1 000 5% - - 0% - 2012 2013 2014 2015 2016 2017 LTM 2012 2013 2014 2015 2016 2017 LTM 2012 2013 2014 2015 2016 2017 Q2 2018 1) Note: Figures according to management reporting (LTM = Last Twelve Months) DOF Subsea 5 2) Note: EBITDA excl. profit from sale of non-current assets
Maintained strong backlog in challenging market Firm backlog Q2 2018 equals firm backlog 2013 45 40 35 30 25 NOK billion 20 15 10 5 0 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2013 2014 2015 2016 2017 2018 Sum of Firm Sum of Options • • Majority of firm contract backlog with Current firm contract backlog equals ~3x investment grade companies actual 2016 revenue • • Firm contract backlog in NOK has been Majority of firm backlog has high EBITDA- relatively steady over time margin DOF Subsea 6
Segment highlights
Two business segments DOF Subsea Group Long-term Chartering 1) Subsea / IMR Projects Framework Engineering Opex Long-term Vessel Capex agreements capabilities spending charters capabilities spending Revenues Q2’18 2) EBITDA Q2’18 3) Revenues Q2’18 2) EBITDA Q2’18 3) Firm backlog 4) Firm backlog 4) NOK 812 million NOK 72 million NOK 4.1bn NOK 391 million NOK 300 million NOK 11.8bn ~9% margin ~77% margin 1 newbuild Q2’18 1 190 Employees 19 vessels in 8 vessels in Q2’18 operation 5) Q2’18 operation Q2’18 1) Note: Long-term Chartering comprises 6 PLSVs in operation and 1 PLSV under construction, plus 3) Note: According to management reporting DOF Subsea Note: Firm backlog as at end of Q2’18 8 Skandi Acergy and Skandi Patagonia 4) 2) Note: According to management reporting 5) Note: Including 4 chartered-in vessels
Subsea/IMR Projects Numerous projects completed and ongoing worldwide Built a leading subsea projects division for over a decade • Subsea project activity established with a global footprint in all key offshore regions • High quality asset base leveraging unrivalled subsea and vessel operating competence A clear action plan to pursue further opportunities • Continue to increase the scope and complexity of operations − Strengthen presence in selected geographies − Further build project backlog with core focus on IMR projects Selected IMR projects – Last 5 years Selected Mooring projects – Last 5 years ✓ Petrobras DSV Contract (2018-2021) ✓ Egina FPSO Hook-up (2018) ✓ ENI Angola IMR Contract (2017-2019) ✓ Lam Son Mooring Replacement (2017) ✓ Husky Energy IMR Contract (2017-2027) ✓ Bergading FPSO Pre-Tensioning (2017) ✓ Shell Prelude IMR Contract (2017-2022) ✓ Yinson OCTP FPSO Field Dev. (2016-2017) ✓ Goliat Field Support ENI (2016) ✓ Bongkot Mooring Replacement PTTEP (2017) ✓ Chevron Gorgon IMR Contract (2015-2019) ✓ Raroa Mooring OMV (2016-2017) ✓ Shell Malampaya IMR Contract (2014-2021) ✓ Gina Krog TMRS Teekay (2016) ✓ ConocoPhillips ROV Services (2012 and onwards) ✓ Catcher Mooring Installation BWO (2016) ✓ ROV Support Vessel Petrobras (2011 and onwards) ✓ Goliat FPSO Marine Installation ENI (2011-2015) ✓ Lam Son Mooring Installation PTSC (2014) DOF Subsea 9
Long-term Chartering DOF Subsea provides state-of-the-art vessels to leading players Skandi Acergy Skandi Acu Skandi Africa 8 1 NOK 11.8bn vessels in contracted firm backlog per Q2’18 operation newbuild Construction Construction & pipe Construction & pipe support vessel laying vessel laying vessel Skandi Niteroi Skandi Patagonia Skandi Vitoria High-end vessels operating advanced subsea projects for third party EPCI Operations contractors Strong long-term contract coverage Contracts Construction & pipe Dive support Construction & pipe laying vessel vessel laying vessel Skandi Buzios Skandi Recife Skandi Olinda Remuneration Day-rate based Selected clients Construction & pipe Construction & pipe Construction & pipe laying vessel laying vessel laying vessel DOF Subsea 10
Selected long-term contracts Feb 2019 • Long-term contract with Sep 2018 Petrobras • 8 years + 8 years options • Vessel owned in joint venture • Long-term FLNG IMR contract with TechnipFMC Skandi Olinda awarded in Australia with • Built in Brazil with 300t VLS Shell • 5 years + 4 years options • IMR scope comprising project Aug 2018 Skandi Achiever management, engineering, logistics, vessel and ROV services • Utilising Skandi Darwin • Long-term contract with Jun 2018 Petrobras • 8 years + 8 years options • Vessel owned in joint venture Skandi Salvador with TechnipFMC • Built in Brazil with 300t VLS Nov 2017 Skandi Recife • Long-term DSV contract with Petrobras • 3 years + 2 years options • ROV and diving services • Partnered up with diving partner in Brazil • Long-term contract with Prelude FLNG Petrobras in Brazil • Vessel and ROV services DOF Subsea 11
2 nd quarter 2018
Q2 2018 highlights • The operating revenue for the quarter was NOK 1 203 million 1) , EBITDA was NOK 372 million 1) and overall vessel utilisation was 76%. • Firm contract backlog as at 30 June 2018 was NOK 15.9 billion. • In June the joint venture with TechnipFMC took delivery of the newbuild PLSV Skandi Recife and the vessel commenced on the 8-year charter contract with Petrobras. • The Brazil region was awarded a 3-year firm contract with a 2-year option by Petrobras in Brazil for the provision of the DSV Skandi Achiever and ROV and diving services. • DOF Subsea was awarded a long-term time charter contract for Skandi Acergy, which will commence when the current contract expires. • The Brazil region was awarded a long-term RSV contract for Skandi Salvador with Petrobras. • The Atlantic region was awarded a contract extension for Skandi Seven with Eni. • DOF Subsea was awarded several short-term contracts in the Asia Pacific region and the Atlantic region securing utilisation of personnel and assets in the Subsea/IMR Projects segment. • DOF Subsea completed refinancing of two vessels and made a drawdown on the loan on Skandi Recife. 1) Note: Figures according to management reporting DOF Subsea 13
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