GC Rieber Shipping ASA - Fourth Quarter 2018 Bergen 18 February 2019 GC RIEBER SHIPPING
Agenda • Highlights Q4 2018 • Operational Review Financial Review • • Outlook and Summary
Highlights Q4 2018 1 • Fleet utilisation of 98% in a quarter with continued challenging market conditions 2 Contract backlog of NOK 434 million as of 1 January • 2019 • Shearwater GeoServices became a market-leading marine geophysical company by completing the acquisition of the marine seismic acquisition assets and operations of WesternGeco, the geophysical services product line of Schlumberger 1 Excluding marine seismic 2 Excluding charterers’ extension options and marine seismic
Highlights Q4 2018 • Net profit of NOK 269.4 million – Including non-cash gain of NOK 310 million as result of Shearwater’s acquisition of Schlumberger’s marine seismic acquisition business • GC Rieber Shipping completed a NOK 246 million rights issue to finance participation in the above-mentioned transaction Highlights after the end of the period • Ship management contract signed with Statnett for technical management of two vessels
Contract updates Shearwater awarded two 3D surveys in the Arabian Sea • – Adding 8 vessel-months to backlog – Both surveys commenced in Q4 2018 Contract updates after the end of the period • Polar Queen’s client declared its extension options, and it was also agreed to extend the contract, prolonging the first period of 45 days under previously announced charter with approximately two months – The second firm period of 50 days will commence end of February 2019 • Shearwater awarded four Ocean Bottom Seismic surveys by Aker BP and Equinor – Securing backlog for the full North Sea summer season for two of Shearwater’s multi -purpose vessels
Highlights Q4 2018 - Key financial figures REVENUES EBITDA* NET PROFIT NOK million NOK million NOK million 274 300 269 80 70 70 70 100 61 100 60 80 80 50 60 60 50 40 40 40 20 20 9 31 0 30 0 -20 -9 -20 -7 20 -40 -22 -40 -60 10 -53 -60 -59 -80 0 -80 -100 -81 -66 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 *Includes profit and losses from Joint Ventures
Operational Review Q4 2018
Contract backlog of NOK 434 million* as of 1 January 2019 CONTRACT COVERAGE* CONTRACT BACKLOG* Utilisation rate NOK million 100% 300 247 79% 80% 200 60% 133 40% 34% 100 54 20% 14% 0% 0 From 1 Jan. 2019 2020 2021 From 1 Jan. 2019 2020 2021 *Excluding marine seismic Excluding charterers’ extension options
Subsea Segment Fleet utilisation of 95% in Q4 2018, compared with • 58% in Q4 2017 • SURF vessel, built KEY FIGURES Polar Onyx 2014 NOK million • LOA: 130m • Polar Onyx on charter for the entire period • Crane: 250mt • VLS-tower: 275mt • Polar King on charter for the entire period • Accommodation: 130 100 Polar Queen on charter for almost three full • 97 % 95 % months in the period • CSV vessel, built 2011 86 % Polar King 65 66 • LOA: 111m 58 % • Outlook 56 • Crane: 150 mt 60 • Accommodation: 112 48 % 46 • Polar Onyx on a fixed charter with DeepOcean until Q1 2021, with options for 27 two more years 14 14 20 11 • Polar King continues on a fixed charter with • CSV vessel, built 2011 Polar Queen Nexans until the end of August 2019 • LOA: 111m • Crane: 150 mt Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 • Accommodation: 119 Polar Queen employed until September 2019 • -20 -13 • Undisclosed client -19 Operating income EBITDA Fleet utilisation (%)
Ice/Support Segment • Polar research and • Fleet utilisation of 100% in Q4 2018, KEY FIGURES Ernest Shackleton subsea support compared with 100% in Q4 2017 NOK million vessel • LOA: 80m 8 • 50 berths, large decks • Ernest Shackleton on bareboat & cranes allows for multiple tasks charter to British Antarctic Survey • Used as an Antarctic until September 2019 research vessel 6 100 % 100 % 100 % 100 % 100 % 4 4 4 4 4 4 4 4 4 4 4 2 0 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Operating income EBITDA Fleet utilisation (%)
Joint Ventures – Ice/Support • Ice/Support • Ice breaking tug with KEY FIGURES* Polar Pevek towing anchor • Fleet utilisation of 100% in Q4 NOK million handling capacity 2018, compared with 100% in Q4 • LOA: 74m 15 • Oil spill drip tray and 14 2017 oil containment system installed 12 • Polar Pevek on charter to Exxon 11 Neftegas (ENL) until 2021 • Crew supply vessel 10 Polar Baikal • LOA: 29m • Polar Baikal and Polar Piltun on • Used for crew transport between charter to Sakhalin Energy shore and Investment Corporation until end installation in North Eastern Russia 5 of 2019 5 • Pax: 70 3 • Share of profit in Q4 2018 of NOK • Crew supply vessel 11 million Polar Piltun • LOA: 35m • Used for crew 0 transport between Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 shore and installation in North Share of profit * Polar Baikal and Polar Piltun only operate for Eastern Russia • Pax: 70 half the year, the vessels are cold stacked in the winter season
Joint Ventures – Marine Seismic (Shearwater) • Marine Seismic (Shearwater) KEY FIGURES • Shearwater achieved a fleet utilisation of NOK million 76% in the period for its three active vessels 40 • Continued competitive rate pressure, 20 intercontinental transits as well as non- recurring transaction costs affected the 0 profitability in the quarter Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 -10 • Shearwater’s total fleet counted sixteen -20 -14 vessels from mid November 2018, at the same time GC Rieber Shipping’s ownership -40 -39 was reduced from 50% to 20% -60 • GC Rieber Shipping’s share of profit was -63 -69 negative NOK 63 million in Q4 -80 • Outlook Share of profit • Active fleet booked for Q1, well underway to secure backlog for Q2 and Q3
Financial Review Q4 2018
Income statement NOK mill Q4 2018 Q4 2017 31.12.2018 31.12.2017 Operating income 70.2 50.4 231.9 264.1 EBITDA 273.7 -65.7 254.9 21.0 EBIT 279.4 -67.2 200.7 -90.0 Profit before tax 265.6 -81.9 148.0 -130.6 Net profit 269.4 -81.4 148.1 -130.1 Normalised profit before tax (1) -75.2 -109.6 -218.1 -142.1 Earnings per share 3.13 -1.86 1.72 -2.98 Number of shares (million) 86.1 43.8 86.1 43.8 (1) Profit bef. tax adjusted for unrealised currency gains/losses, profit from disposals, impairment of fixed assets and P&L- effect from Shearwater’s acquisition of Schlumberger’s marine seismic business
Balance sheet 31.12.2018* NOK million 3 000 Total balance NOK 2,977 million • (NOK 2,447 million) 2 500 • Equity ratio 57.5 percent 1711 2 000 (46.6%) Equity • Cash position NOK 204 million 2715 1 500 (NOK 108 million) Fixed assets • Net debt NOK 1,016 million 1 000 Long-term (NOK 1,123 million) liabilities 1203 500 Other current 59 assets Current 204 Cash & liquid liabilities 63 0 assets Assets Equity & Liabilities * 31.12.2017 in brackets
Outlook and Summary Q4 2018
Outlook • Market view short term • The oil price has remained volatile and is currently traded around USD 60 per barrel • The overall offshore market sentiment has become more positive, but has yet to turn into tangible projects yielding appropriate returns Expected market trends • • Subsea: Slow overall improvement, but continued uptick in activity and market rates towards the summer season Renewables: Decent activity levels and indication of increasing market rates • Marine seismic: Improvement in activity levels and market rates • Ice/support: Stable and unchanged activities and market rates in a gradually improving market •
Summary • High utilisation in the subsea and ice segments • Solid contract coverage throughout Q3 2019 • Offshore market conditions remain challenging with unsustainable rates, however gradual improvement is expected in 2019 and into 2020 Shearwater well positioned for improved marine seismic market conditions after closing • acquisition of Schlumberger’s marine seismic acquisition assets and operations
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