Investor Presentation June 2020 Oceaneering.com 1
Forward‐Looking Statements In accordance with the Safe Harbor provisions of the free cash flow and our focus on generating positive free You should not place undue reliance on forward‐looking Private Securities Litigation Reform Act of 1995, cash flow. Although we believe that the expectations statements. This presentation reflects the views of Oceaneering cautions that statements in this reflected in those forward‐looking statements are Oceaneering's management as of the date hereof. presentation that express a belief, expectation, or reasonable, we can give no assurance that those Except to the extent required by applicable law, intention are forward looking. Forward‐looking expectations will prove to have been correct. Those Oceaneering undertakes no obligation to update or revise statements are generally accompanied by words such as statements are made by using various underlying any forward‐looking statement. “estimate,” “project,” “predict,” “believe,” “expect,” assumptions and are subject to numerous risks, Non‐GAAP Disclosures: “anticipate,” “plan,” “forecast,” “budget,” “goal,” or other contingencies and uncertainties, including, among words that convey the uncertainty of future events or others: factors affecting the level of activity in the oil and This presentation includes several “non‐GAAP” financial outcomes. gas industry; supply and demand of drilling rigs; oil and measures, as defined under Regulation G of the U.S. natural gas demand and production growth; oil and Securities Exchange Act of 1934, as amended. The forward‐looking statements in this presentation natural gas prices; fluctuations in currency markets include, among other things, statements about: Oceaneering reports its financial results in accordance worldwide; future global economic conditions; the loss of with U.S. generally accepted accounting principles, but maintaining liquidity and a strong balance sheet; targeted major contracts or alliances; future performance under believes that certain non‐GAAP financial measures cost reductions, annualized cost savings initiated to date, our customer contracts; and the effects of competition. and costs associated with cost‐reduction actions; provide useful supplemental information to investors Should one or more of these risks or uncertainties regarding the underlying business trends and strengthening our portfolio of services and products; materialize, or should the assumptions underlying the performance of its ongoing operations and are useful for offshore activity and investment levels and the long‐term forward‐looking statements prove incorrect, actual outlook for offshore, including expectations about Brent period‐over‐period comparisons of those operations. The outcomes could vary materially from those indicated. non‐GAAP measures in this presentation include EBITDA, crude prices, offshore and subsea expenditures and Adjusted EBITDA, Adjusted Operating EBITDA and Free investments, contracted floating rig demand, subsea tree For additional information regarding these and other Cash Flow. These non‐GAAP financial measures should be awards and installations, offshore FIDs, and global crude factors that may affect our actual results, see our considered as supplemental to, and not as substitutes for production; expectations regarding anticipated 2020 periodic filings with the Securities and Exchange or superior to, the financial measures prepared in activity for ROVs; the anticipated benefits of acquisitions; Commission, including our most recent Reports on Forms accordance with GAAP. The definitions of these non‐ our Subsea Products backlog, to the extent backlog may 10‐K and 10‐Q. GAAP financial measures and reconciliations to the most be viewed as an indicator of future revenue or comparable GAAP measures are provided in the profitability; our outlook for 2020, and the factors Supplemental Information section of this presentation, underlying our outlook, including as to beginning on page 25. 2
Reasons to Own Oceaneering • Strong portfolio of diversified services and products, and market positions • Non‐energy diversification • Increasing focus on eco‐friendly enabling opportunities • Provider of integrated technology solutions • Geographically dispersed asset base and revenue streams • Blue‐chip customer base • Offshore projects remain imperative 3
Another Reason to Own Oceaneering ‐ Sustainability Managing our business in a way that promotes: • Safety and Health • Environmental Sustainability • Community Relations • Workforce Diversity, and • Ethics and Compliance 4
Five Operating Segments Energy: Remotely Operated Vehicles (ROV) Subsea Products Subsea Projects Asset Integrity Non‐Energy: Advanced Technologies 5
Active in All Phases of the Offshore Oilfield Life Cycle Exploration Development Production Decommissioning Phase 14% 52% 32% 2% % of Oceaneering Revenue* Floating Subsea Tree Subsea Trees Field Market Driver Drilling Rigs Installations In Service Abandonments • ROV Services • ROV Services • ROV Services • ROV Services Business Segment and • Survey (SP) • Survey (SP) • Tooling (SSP) • Tooling (SSP) Product and Service • Tooling (SSP) • Tooling (SSP) • Subsea Work Systems • Subsea Work Systems Revenue Streams (SSP) (SSP) • IWOCS – Installation & • IWOCS – (SSP) Workover Control Systems • IWOCS – (SSP) (SSP) • Subsea Hardware (SSP) KEY • Subsea Hardware (SSP) • Vessel‐based ROV = Remotely Operated • Umbilicals (SSP) Installation Services Vehicles (SP) • Vessel‐based Installation SSP = Subsea Products • Inspection Services (AI) Services (SP) SP = Subsea Projects • Inspection Services (AI) AI = Asset Integrity • Seabed Preparation/ 6 Trenching (SP) *Estimates as of December 31, 2019.
Revenue Sources Geographic Area Services and Products Industry Segments $1.9B $2.0B $1.9B $2.0B $1.9B $2.0B 100% 21% 22% 35% 35% 45% 75% 50% 50% 79% 78% 65% 65% 55% 25% 50% 0% 2018 2019 2018 2019 2018 2019 International United States Services Products Energy Segments Non‐energy Segment 7
Financial Overview, Quarterly Revenue Adjusted Operating EBITDA* $30.4M $48.7M $51.6M $493.9M $560.8M $536.7M 100% 100% 9% 11% 16% 20% 20% 2% 23% 4% 1% 17% 9% 75% 75% 11% 11% 17% 12% Adtech 12% 15% 33% 18% 20% Asset Integrity 33% 50% 50% Subsea Projects 36% 33% Subsea Products 26% ROV 25% 25% 46% 43% 39% 21% 21% 21% 0% 0% 2019 Q1 2019 Q4 2020 Q1 2019 Q1 2019 Q4 2020 Q1 *Percentages exclude Unallocated Expenses and the effects of certain specified items. 8 For reconciliation of Adjusted Operating EBITDA to Operating Income, see the Supplemental Information.
Comparing Results * 2020 Q1 vs 2019 Q4 Q1 2020 compared to Primary Variance Factors Q4 2019 Consolidated Results Improved Better‐than‐anticipated performance in energy‐focused businesses Benefits from cost control measures and efficiencies, along with fewer ROV Higher installations and mobilizations, on marginally lower revenue. Service/Rental recorded higher activity in Norway and West Africa; Subsea Products Higher Manufactured Products performed as expected. Subsea Projects Seasonally lower vessel and survey activity, as expected. Lower Benefits from cost reduction activities undertaken in the fourth quarter of Asset Integrity Higher 2019 and first quarter of 2020. Gains from government service businesses partially offset by adverse Advanced Technologies Higher impacts of COVID‐19 to entertainment business results. Unallocated Expenses Improved Lower accruals for incentive‐based compensation. EBITDA, Adjusted +$2.9M $51.6M 9 * ‘Results’ are Adjusted Operating Income; excluding EBITDA, Adjusted.
Liquidity and Cash Flow Liquidity at March 31, 2020 • $307 million of cash and cash equivalents • $500 million undrawn unsecured revolving credit facility available until October 2021; thereafter $450 million available until January 2023 • $500 million of senior notes due November 2024 is nearest maturity Cash flow for the quarter ended March 31, 2020 • Cash flow from operations, $(32) million • Capital expenditures, $27 million 10
Q1 2020 Revenue Remotely Operated Vehicles 21% We provide ROVs, which are tethered submersible vehicles that are remotely operated from a vessel or Adjusted EBITDA Margin 32% onshore, to customers in the energy industry for drilling support and vessel‐based services, including subsea hardware installation, construction, pipeline inspection, survey and facilities inspection, maintenance and repair. 11
ROV 2020 Q1 ~$7,500/day on hire; 68% Drill Support / 32% Vessel‐based Drill Support Days Revenue / Day on Hire Adjusted Vessel‐based Days Fleet Utilization EBITDA Margin Rate ROV Adjusted EBITDA Margin ROV Fleet Utilization $12,000 100% 30,000 100% Average Revenue per Day on Hire 25,000 $10,000 80% 80% ROV Days on Hire 65% 20,000 $8,000 60% 60% $6,000 15,000 40% 40% 32% 10,000 $4,000 20% 20% 5,000 $2,000 $0 0% 0 0% 12
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