Atwood Oceanics Pareto Securities Oil & Offshore conferences Sept 2013

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Transcript of Atwood Oceanics Pareto Securities Oil & Offshore conferences Sept 2013

  • 1. 1 September 4, 2013 Pareto Securities 20th Annual Oil & Offshore Conference Mark L. Mey Sr. Vice President and CFO

2. 2 Forward Looking Statements Statements contained in this report with respect to the future are forward-looking statements. These statements reflect managements reasonable judgment with respect to future events. Forward-looking statements are subject to numerous risks, uncertainties and assumptions and actual results could differ materially from those anticipated as a result of various factors including: uncertainties related to the level of activity in offshore oil and gas exploration and development; oil and gas prices; competition and market conditions in the contract drilling industry; the risks inherent in the construction of a rig; delays in the commencement of operations of a rig following delivery; our ability to enter into and the terms of future contracts; possible cancelation or suspension of drilling contracts; the availability of qualified personnel; labor relations; operating hazards and risks; terrorism and political and other uncertainties inherent in foreign operations (including risks of war, civil disturbances, seizure or damage to equipment, and exchange and currency fluctuations); the impact of governmental and industry laws and regulations; and environmental matters. These factors and others are described and discussed in our most recently filed annual report on Form 10-K, in our Forms 10-Q for subsequent periods and in our other filings with the Securities and Exchange Commission which are available on the SECs website at www.sec.gov. Each forward looking statement speaks only as of the date of this presentation and we undertake no duty to update the content of this presentation or any forward-looking statement contained herein to conform the statement to actual results or to reflect changes in our expectations. 3. 3 Overview & Strategy 4. 4 Transforming Atwood Oceanics Multi-year investment in fleet modernization and expansion Delivering 6 UDW floater and 3 jackup newbuilds from 2011 through 2015 Will own youngest high-specification floater and jack-up fleets in the industry Industry-leading safety and reliability performance Top-tier revenue efficiency, cost control and project management leads to: Best-in-class margins Superior shareholder returns Growth is fully funded and sourced predominantly from operating cash flow Current contract backlog of $3.9 billion Retain substantial balance sheet flexibility 5. 5 $245 Q1 $527 $651 $787 $253 Q2 $273 Q3 $288* Q4 $0 $200 $400 $600 $800 $1,000 $1,200 2008 2010 2012 2013 Note: Revenue and Net Income represented on fiscal year basis. Source: * IPREO Factset dated August 27, 2013 Steady Revenue and Earnings Growth 2008-Present $ Millions $73 Q1 $215 $257 $272 $86 Q2 $90 Q3 $96* Q4 $0 $50 $100 $150 $200 $250 $300 $350 2008 2010 2012 2013 $ Millions Revenue Net Income 6. 6 Shareholder Return: ATW Vs. Peers* *As of August 28, 2013 Source: FactSet 125.7% -4.7% 26.3% 26.6% 41.5% 47.4% 154.2% -20% 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% ATW RIG NE DO RDC ESV SDRL Total Shareholder Return: 3 Year Comparison 809.9% 52.8% 118.7% 125.3% 133.8% 416.5% 0% 100% 200% 300% 400% 500% 600% 700% 800% 900% ATW RDC RIG ESV NE DO Total Shareholder Return: 10 Year Comparison 4085.0% 745.7% 290.9% 0% 500% 1000% 1500% 2000% 2500% 3000% 3500% 4000% 4500% ATW NE RDC Total Shareholder Return: 20 Year Comparison 25.0% -4.6% 0.8% 2.7% 2.9% 3.4% 20.5% -10% -5% 0% 5% 10% 15% 20% 25% 30% ATW RIG ESV RDC NE DO SDRL Total Shareholder Return: 1 Year Comparison 7. 7 Expanding our High Specification Rig Fleet Five newbuilds delivered on budget and ahead of schedule 2011 2012 2013 2014 2015 AtwoodOsprey AtwoodOrca AtwoodMako AtwoodManta AtwoodAdvantageAtwoodCondor CALENDAR YEAR 6 Ultra-Deepwater Floaters 3 High-Spec Jackups $4.5 Billion Investment Projected $57 million potential annual revenue per jackup Projected $200 million potential annual revenue per UDW $1.4 billion in potential total annual revenue from these 9 rigs AtwoodAchiever AtwoodAdmiral Delivered and Working Under Construction; Contracted AtwoodArcher 8. 8 Improving Revenue Quality 2011 vs. 2015 *Source: Atwood internal analysis (pro forma estimate for FY 2015) 10% 80% 10% FY 2011 Revenue Ultra Deepwater Floaters High Spec Jackups Other 17% 29% 54% FY 2015 Revenue* Ultra Deepwater Floaters High Spec Jackups Other 9. 9 Fleet Transformation and Growth Atwoods fleet has a strong presence in Australia, Southeast Asia and West Africa Houston, Texas Headquarters UDW / DW Semisubmersibles ATWOOD EAGLE ATWOOD FALCON ATWOOD HUNTER ATWOOD OSPREY ATWOOD CONDOR VICKSBURG ATWOOD BEACON ATWOOD AURORA Jack-ups ATWOOD MANTA ATWOOD ORCA ATWOOD MAKO Newbuild Drillships ATWOOD ADVANTAGE ATWOOD ACHIEVER ATWOOD ADMIRAL ATWOOD ARCHER 10. 10 Execution Performance 11. 11 Revenue Efficiency Achieving Top-Tier Execution Cost Control Project Management Best-in-class Operating and Net Margins Consistent, Superior Shareholder Returns 2011 - Atwood Osprey 2012 - Atwood Mako - Atwood Condor 2013 - Atwood Manta - Atwood Orca 2014 - Atwood Advantage - Atwood Achiever 2015 - Atwood Admiral Key Enablers - Centralized maintenance and technical support - Consistent standards and institutionalizing lessons learnt - Common equipment across rigs and supplier consolidation - Organic growth with proven rig designs and world-class shipyards - Early capital project scoping and detailed project planning - Experienced project management teams Value Drivers 12. 12 1.05 0.80 0.68 0.0 0.2 0.4 0.6 0.8 1.0 1.2 2008 2010 2012 Continuous Safety Performance Improvement Fiscal Year 2008-Present Total Recordable Incident Rate Atwood Oceanics recognized as leading offshore driller for HSE in 2012* 0.26 0.18 0.06 0.00 0.05 0.10 0.15 0.20 0.25 0.30 0.35 0.40 2008 2010 2012 Lost Time Incident Rate *Results from EnergyPoint Research customer satisfaction survey published February 20, 2013 13. 13 Signed Orca to initial 2-year contract in Thailand Jan 2013 Announced 1Q FY2013 results with 95% revenue efficiency Jan 2013 DeliveredAtwood Orca 10 weeks ahead of schedule April 2013 Announced 2Q FY2013 results with record quarterly revenue May 2013 Agreed to repurchase 2 million shares from Helmerich & Payne May 2013 SignedAtwood Eagle to 2-year contract inAustralia May 2013 SignedAtwood Condor to 39-month contract in the Gulf of Mexico June 2013 SignedAtwood Beacon to 2-year contract in Italy June 2013 SignedAtwoodAchiever to 3-year contract in Morocco June 2013 AtwoodAnnounces 4th Drillship theAtwoodArcher June 2013 Announced 3Q FY2013 results with record quarterly revenue July 2013 SignedAtwood Manta to 2-year contract extension inThailand August 2013 MajorAccomplishments Year to Date Partial Listing 14. 14 Contracting of the Vicksburg (early 2014 availability) Delivery and start-up of theAtwood Advantage Contracting ofAtwoodAdmiral (2015 availability) Calendar 2013 Priorities and Potential Catalysts 15. 15 Market Outlook and Contracts 16. 16 64 Recent Discoveries in Floater Water Depths* December 2011 to June 2013 Source: IHS-Petrodata 5 12 4 7 5 5 12 10 7 9 * Water depths greater than 500 ft. Golden Triangle Deepwater and ultra-deepwater prospectivity continues to be excellent 17. 17 Steady Floater Utilization UDW Rigs Sold Out Source: IHS-Petrodata Note: Contracted Utilization equals Working Rigs / Total Supply 80% 82% 84% 86% 88% 90% 92% 94% 96% 98% 100% 0 20 40 60 80 100 120 140 Utilization TotalSupply Floater Utilization UDW (7500+) Total Supply 7500+ 70% 75% 80% 85% 90% 95% 100% 150 170 190 210 230 250 270 290 310 Utilization TotalSupply Floater Utilization by Category - >7,500 Total Supply 5001-7500 3001-5000