Presentation 3 rd Quarter 2013 CEO Kre Johannes Lie REACH SUBSEA - - PowerPoint PPT Presentation

Presentation 3rd Quarter 2013 CEO Kåre Johannes Lie

REACH SUBSEA – HIGHLIGHTS-2012

• Reach Subsea was established in 2008 in Norway by four founders with

extensive subsea experience. – During the last 4 years the company has provided ROV and engineering/ consultancy services to the oil industry, incl. development of a new survey ROV, the “Surveyor”

• Reach Subsea expansion plan launched summer 2012.

– Ambition to become a complete Subsea Service Provider – Business expansion through new equity, new management, new shareholders and a focused business plan. – First 2 complete Work ROV systems ordered for July 2013 delivery

• Reach Subsea merged with Transit Invest ASA in December 2012 (former

Green Reefers) to create a new listed subsea company Reach Subsea ASA (Reach) on Oslo Stock exchange. – Raised NOK 42m in short term funding December 2012 – Financial Group Accello Partners 1 in Oslo now largest shareholder.

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REACH SUBSEA – HIGHLIGHTS-2013

• Reach Subsea agreed with Solstad in February this year to charter the

newbuild Normand Reach for a 5 year period plus options. – The vessel is a state of the art OCV with 250 tonnes crane and will be delivered early June next year. – Raised NOK 110 million in may 2013 to support this commitment

• Reach Subsea signed a letter of intent in Q2 this year with MMT (Marin

Mätteknik) to create a new Joint Venture company for advanced ROV/survey operations. – AS part of this plan the JV has now ordered the first “Surveyor “ ROV for high speed pipeline inspections and seabed mapping. Delivery will be 2nd quarter next year.

• Reach Subsea chartered in July this year the MPSV Bourbon Emerald for

140 days with further options for next year. – First operation in July very successful using own newbuild ROV system – Working up to end november for several different clients like CaleCore /Wintershall , Lundin and Mojo/Voith in the North Sea

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REACH SUBSEA – HIGHLIGHTS-2014

• Reach Subsea agreed with Dof Subsea AS in november this year a 2 year

firm contract with 2 yearly options. – The contract will start upon delivery of the newbuild from yard and include 2 of Reach Subsea WorkROV systems with personnel. The contract opens for further delivery of engineering support and subsea services to Dof Subsea onboard Normand Reach.

• Reach Subsea purchases 2 WorkROV systems.

– Delivery of the systems will take place in December this year .

• Reach Subsea is planning to operate 2 vessels next year in cooperation

with our survey partner. – The first vessel will be similar to Bourbon Emerald (90-100m)but with some upgraded capabilities. Our WorkROV system will be installed

• nboard .The vessel will be operated by Reach Subsea.

– The second vessel will be a survey vessel (70-80m). Our new “Surveyor” ROV will be installed onboard and operated by Reach Subsea.

• Order backlog approaching NOK 400 million.

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FIVE YEAR PERSPECTIVE – ON PLAN SO FAR

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• Vessel spread ready for
• ffshore work 3Q 2013
• Realistic growth plan –

increasing fleet by one vessel per year

• Investing in new assets and

securing the right assets

• Targeting an efficient mix of
• wned and leased vessels
• Reach is well positioned to

take advantage of the increasing number of subsea installations and IMR services going forward

2012e 2013e 2014e 2015e 2016e Vessels 1 3 4 5 ROV systems 3 7 12 12 Employees 10-15 30-40 100- 150 200 250 Engineering staff 5 15 40 60 80

Vessel Owners Subsea Services Subsea EPIC

• Asset intensive (-)
• Lump-sum turn-key risk (-)
• Principally capex driven, more volatile

(-)

• Highly differentiated, engineering (+)
• High barriers to entry, expertise and

capital (+)

• Less asset intensive (+)
• Dayrate + spread revenue model (+)
• High demand within capex and opex

(+)

• High barriers to entry for expertise (+)
• Engineering/technology driven (+)

SUBSEA SERVICES

• Asset intensive (-)
• Dayrate revenue model (+)
• Demand growth (+)
• Limited differentiation (-)
• Low barriers to entry/ fragmented (-)

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Business characteristic s Traditional players

• Several publicly traded

companies and regional competitors

Located in the Haugesund region

HIGHLY EXPERIENCED MANAGEMENT TEAM

BUSINESS SEGMENTS

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• Reach aims at the Light

construction support market assisting EPIC contractors or

• il companies direct
• Can be complex projects with

higher risk, better margins

• Growing market with few

players.

• Existing players in capacity

squeeze open possibilities for subcontracting entire vessel spreads and/or engineering packages

Construction and installation

• 3D seabed mapping
• Pipeline inspection
• “In house” developed

“Surveyor” ROV

• Partnership with MMT
• Key elements:

– Data processing – Accuracy – High quality – High speed

Survey and pipeline inspection

• Inspection of subsea

infrastructure for oil companies

• Maintenance and repair
• f subsea assets
• Module handling
• Light construction
• Well stimulation (scale

squeeze)

• Often long term frame

contracts

Inspection, maintenance and repair

• Growing immature

market

• Project contracts
• Similar assets and

competence requirement as construction

• Complementary market

segment to IMR and I&C, as demand for services is likely to increase .

Decommissioning

NORMAND REACH DOF SUBSEA CONTRACT

– 2 year contract from yard delivery plus 2 yearly

• ptions

– Delivery includes Reach 2 workrov units with advanced handling and rov personel – Possibility for increased services related to

• ffshore an engineering services

– Cooperation started already with further development of Normand Reach capabilities – The contract provide Reach with a safe and stable income at acceptable terms – The contract give Reach more financial freedom to invest in new assets growing the company

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INSPECTION,MAINTENANCE AND REPAIR

– Reach Subsea has shown this year to the market that the company can provide high quality IMR services at competitive pices to the end- clients fully satisfaction – Next year we plan to introduce in 1.quarter an IMR chartered vessel similar to Bourbon Emerald but with even better capabilities – Our new vessel will be capable of serving

• Construction support to EPIC contractors
• Pipeline inspection and IMR tasks to oil

companies

• Survey and Light construction jobs
• The vessel will be of high north Sea

standard and meeting all requirements for

• perations in harsh environment

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REACH SUBSEA AND MMT COOPERATION

– Reach Subsea and MMT has in 2013 worked together

• nboard Bourbon Emerald where MMT has delivered

specialized survey services and Reach ROVS and other subsea services – The parties plan in 2014 to continue this cooperation on

• ne Survey vessel and one larger ROV/IMR vessel
• utfitted with services from both Reach and MMT .

– The Survey vessel will in 2.quarter 2014 be equipped with

• ur new “Surveyor” ROV owned by both parties.

– Marketing and sales of the 2 vessels will be done by both parties . MMT (Marin Mætteknik) is a Swedish survey company with 25 years experience

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PROJECT – INSTALLATION OF TURBINE

Installation of a cable management system and a cable for a new tidal water turbine at Eday test site. Due to extreme current conditions, operation had to be preformed in a given period. Vessel was therefore mobilized with ROV equipment in Kirkwall. Reach Subsea provided additional engineering for the end client.

Client Mojo Marine Location Kirkwall Period August

PROJECT – MARIA SEABED SURVEY

Client Calecore Location Haltenbanken Period August - October

For end client Wintershall, Reach Subsea preformed route survey, site survey, environmental investigation and geotechnical work with vessel Bourbon Emerald. Our Supporter 20 was installed with survey equipment and preformed excellent during the project. Mobilization started in Kristiansund 14th of August and port of demobilization was Stavanger the 17th of October.

PROJECT – NETGUARD REPLACEMENT

Client Lundin Petroleum Location Johan Sverdrup Period October

During installation from rig, Lundin had failed to install the well protection cover. These type of covers had never before been installed or replaced from a vessel, as drill string was the normal lifting device. Reach Subsea performed all engineering, procurement and planning within 10 days from project start and mobilized vessel Bourbon Emerald. Well protection cover was successfully replaced and sensor equipment for well monitoring installed.

PROJECT – TURBINE RECOVERY

Client Voith Location Kirkwall Period November

Problems occurred with the tide water turbine that was installed in august and due to the good performance

• f our Supporter ROV in the extreme current conditions,

Reach Subsea was again asked to support the recovery operation. Vessel Bourbon Emerald worked together with a 400Te lifting vessel and recovered the turbine as planned. Reach Subsea supported the project with engineering resources during planning of recovery.

QUARTERLY CONSOLIDATED REPORT

Resultatregnskap

(i NOK '000)

INCOME STATEMENT

(in NOK '000

2013 2012 2013 2012 (Only Reach Subsea AS) (Only Reach Subsea AS) 01.07 – 30.09 01.07 – 30.09 01.01 – 30.09 01.01 – 30.09

Driftsinntekter 35.457 797 38.186 2.567 Operating income, in total Driftskostnader (32.470) (2.191) (43.835) (3.953) Operating costs, in total Driftsresultat før avskriving (EBITDA) 2.987 (1.393) (5.649) (1.387) Operating result before depreciation (EBITDA) Avskrivninger 1.324

• 1.324
• Depreciation

Driftsresultat (EBIT) 1.663 (1.393) (6.973) (1.387) Operating result - EBIT Netto finans 1.264 8 2.072

• Financial items in total

Overskudd (underskudd) før skatt 2.927 (1.310) (4.927) (1.387) Profit (loss) before taxes Skatt

• Taxes

Overskudd (underskudd) 2.927 (1.310) (4.927) (1.387) Profit (loss)

QUARTERLY CONSOLIDATED REPORT

Konsolidert balanse

(i NOK '000)

Consolidated balance sheet

(in NOK '000)

Konsolidert Consolidated Konsolidert Consolidated (only Reach Subsea AS) revidert/audited revidert/audited 30.09.2013 30.09.2012 Eiendeler / Assets Sum anleggsmidler 63.901 8 Total non-current assets Sum omløpsmidler 143.240 7.118 Total current assets Sum eiendeler 207.140 7.126 Total assets Egenkapital og gjeld / Equity and liabilities Sum egenkapital 136.957 6.198 Total equity Sum langsiktig gjeld 57.159 Total non-current liabilities Sum kortsiktig gjeld 13.024 928 Total current liabilities Sum egenkapital og gjeld 207.140 7.126 Total equity and liabilities

QUARTERLY CONSOLIDATED REPORT

Kontantstrøm

(i NOK '000)

2013 2013 Cash flow

(in NOK '000)

01.07-30.09 Revidert/ audited 01.01-30.09 Revidert/ audited Resultat før skattekostnad 2.927 (4.927) Profit (loss) before tax Netto kontantstrøm fra operasjonelle aktiviteter (21.571) (33.567) Net cash flow from operating activities Netto kontantstrøm fra investeringsaktiviteter (60.502) (60.987) Net cash flow from investing activities Netto kontantstrøm fra finansieringsaktiviteter 57.159 154.819 Net cash from financing activities Netto endring i kontanter og kontantekvivalenter (24.914) 60.266 Net change in cash, cash equivalents and bank overdrafts Kontanter og kontantekvivalenter 01.01 130.757 45.578 Cash, cash equivalents and bank

• verdrafts as of 01.01

Kontanter og kontantekvivalenter 30.09 105.844 105.844 Cash, cash equivalents and bank

• verdrafts at end of period

QUARTERLY CONSOLIDATED REPORT

ACCELLO PARTNERS I AS

23 444 254 30,9 %

JOSO INVEST AS

6 864 589 9,0 %

JT INVEST AS

5 301 539 7,0 %

A-Å INVEST AS

3 749 949 4,9 %

GSE SANDVIK AS

3 437 500 4,5 %

CAIANO AS

2 281 881 3,0 %

THERMOTECH INVEST AS

1 795 840 2,4 %

SMS INVESTERING AS

1 652 366 2,2 %

AS SPECTRA

1 250 000 1,6 %

TEM INVEST AS

1 250 000 1,6 %

BARRUS CAPITAL AS

1 112 160 1,5 %

BARCLAYS CAPITAL SECURITIES LTD.

1 026 599 1,4 %

INVICTA INVEST AS

909 179 1,2 %

TOLUMA NORDEN AS

877 491 1,2 %

LOGTEK HOLDING AS

811 053 1,1 %

SKEISVOLL & CO AS

734 300 1,0 %

LION INVEST AS

711 790 0,9 %

CONSUS AS

710 925 0,9 %

SPORTSMAGASINET AS

682 030 0,9 %

ENGELSVOLD

667 300 0,9 %

20 STØRSTE

59 270 745 78,1 %

Øvrige aksjonærer

16 647 438 21,9 %

Totalt antall aksjonærer

75 918 183 100,0 %