Helge Kvalvik, CEO - Boa Offshore Helge Kvalvik, CEO . ... BMS solution/ project provider for: ......

Boa Offshore – 3 March 2015

Full year 2014 Results presentation

Helge Kvalvik, CEO

This presentation is made by Boa Offshore (or the ”Company”). The information contained herein

include statements that are ”forward-looking” in their nature. These forward-looking statements include

all matters that are not historical facts and are based on the Company’s current intentions, believes

and expectations about among other things, the Company’s results of operations, financial condition,

prospects, growth, strategies and the industry in which the Company operates. Such forward-looking

information and statements reflect current views with respect to future events. The Company cannot

give any assurance as to the correctness of information and statements related to such future events.

Furthermore, these forward-looking statements involve known and unknown risks, uncertainties and

other factors that are in many cases beyond the Company’s control that could cause the actual results

of operations, financial condition, liquidity and the development of the industry in which the Company’s

businesses operate to differ materially from the impression created by the forward-looking statements

contained herein, because they relate to events and depend on circumstances that may or may not

occur in the future. Although the Company believes that its intentions, beliefs and expectations, and

the statements in this presentation, are based on reasonable assumptions as of today, the Company

can not give any assurance that the actual results will be as set out in this presentation. Financing the

Company involves risks, and several factors could cause the actual results, performance or

achievements of the Company to be materially different from the impression created by the forward-

looking statements contained herein. Neither the Company, nor any company within the Boa Offshore

Group, is making any representation or warranty (express or implied) as to the accuracy, reliability or

completeness of the information and statements in this presentation, and neither the Company, any

company within the Boa Group, nor any of their directors, officers or employees will have any liability

to any persons resulting from the possible use of information in the presentation.

Disclaimer

2 2

3 Boa Offshore Financials

Contents

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2 Boa Offshore update and overview

4 Boa Offshore Business segments

5 Market Outlook

1 Boa Offshore summary

Boa Offshore Group – Summary Full Year 2014

• Boa Offshore 2014 results

EBITDA for Full Year 2014 reported at NOKm 461 vs’ NOKm 430 in 2013

Fourth quarter 2014 EBITDA of NOKm 112 - below 3Q 14, above 1H14 level

FY 2014 Net profit of NOKm 33 – negatively impacted by NOKm 91 in ekstraordinary items

- Dis-agio and OCV re-financing costs

• Balance sheet

NIBD at YE 2014 of NOKbn 3, up from NOKbn 2.7 in previous quarter

- Newbuilds (Boa Jarl, dis-agio, working capital – latter reversed in 1Q15)

NIBD/EBITDA LTM increased to 6.5x from 5.7x in 3Q14

Value adjusted Equity of 43% per YE 2014, down from 47% in 3Q14

Cash position solid at NOKm 634 per YE 2014

- Re-financing of OCV 1.pri Bond completed in October

• Market Outlook

Uncertain outlook due to lower oil prices remains, despite recovery in oil prices from January low

However many of the segments where Boa Offshore operates are exposed to less cyclical

factors

- Barges: Operating within a range of industries, outside oil & gas

- Tugs: Ports and Terminals

- OCV/BMSI: A significant part is IMR related

Main risk to 2015 EBITDA spot exposure in BMSI and AHTS

- EBITDA 2015 objective at least at 2014 level

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Contents

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5 Market Outlook


Boa Offshore Group in short

• Boa Offshore AS is a Norwegian limited company owned by Ole T. Bjørnevik and his family

• Boa Offshore currently operates and manages a diversified fleet of 41 units in various segments, of which 37 owned (including newbuilds)

Subsea installation and construction (Boa OCV/BMSI)

Sea transportation and load-out and launching of heavy objects (Boa Barges/BMSI)

Rig moves (tugs/AHTS)

Seismic EM vessel operations (Boa SBL)

Harbor and costal towage and salvage operations (tugs)

• Global presence and operations, and Leading player in the global market for heavy lift barges

• Head Office in Trondheim (Norway) and offices in Houston (USA) and Gdynia (Poland), with approximately 395 employees

• Engineering and project management capacity out of Trondheim and Houston

6

Business overview – Concentrated in three segments

10 Tugs 20 Barges 11 Offshore Vessels

• 4 ASD escort tugs

• 5 harbour / towage tugs

• 1 harbour tug

• 8 semi-submersible barges

• 8 deck cargo barges

• 3 other barges

• Newbuild BB 37 initiated

• OCV – Boa Sub C

• OCV – Boa Deep C

• SBL – Boa Thalassa

• SBL – Boa Galatea

• Boa Bison

• 1/3 newbuilds

• 3 chartered subsea vessels

Mid-Norway and North Sea operations

Tugs has been the core business of Boa since inception

Revitalization of this business segment with a substantial fleet renewal and growth

World wide operations

Leading player in the global heavy lift market

Continuous new building program since 1999

World wide operations

Ongoing modernization of the fleet, including NFDS

Successfully owns and operates two of the world’s most high spec OCVs

Tonnage provider and solution/ project provider for:

• Salvage operations

• Turn key towage / transport / handling operations

Tonnage provider, also solution/ project provider for:

• All engineering related to barges. In house design

• Turn key transportation projects

• Load out and launching

• Dry docking operations

• Float over

BMS solution/ project provider for:

• SURF (subsea, umbilicals, risers and flowlines)

• IRM (inspection, repair and maintenance)

• Floater moves and installations

• Also use of 3rd party vessels

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5 Market Outlook


Boa Offshore Group consolidated historical financials

• EBITDA for Full Year 2014 reported at NOKm 461 vs’

NOKm 430 in 2013

4Q14 EBITDA of NOKm 112 - down from strong

3Q14 of NOKm 147, in line with 4Q13 of NOKm

114

Improving performance in OCV, Barges, SBL,

and Parent. - USD/NOK effect

Weak performance in AHTS, BMSI and Tugs. All

negatively impacted by dockings, seasonality and

yard stays

• YE 2014 Net Interest Bearing Debt increased to

NOKbn 3 from NOKbn 2.7 in 3Q 14

Newbuilding program (Boa Jarl), working capital

(reversed in 1Q) and smaller dockings

• Fleet value of NOKbn 4.9 per YE 2014

• Remaining estimated capex < NOKm 200, down from

NOKbn 1 Q/Q in 3Q14 - excl’ MPSVs

• Relative sound key credit matrices per YE 2014

Value adjusted equity 43%

NIBD/EBITDA LTM 6.5x

• Net Debt about to stabilize, before decreasing from 2H15

9

Key financial items

Key balance sheet items

Boa Offshore initiated newbuild program – fully financed

10

• Initiated newbuild program fully financed

• Early July 2014 Boa took delivery of the AHTS Boa

Bison

• Boa Offshore , through its subsidiary Boa PSV, has

started a legal process to look into the company’s rights

to cancel the contracts for the two MPSVs in China

according to the British regulations they are subjected to.

The two vessels have in place full refund

guarantees from the yard’s banks.

• Remaining estimated capex 2015e for newbuilding

program (incl. Boa Jarl) of < NOKm 200, down from <

NOKbn 1 in 3Q14

Excl VS 495 MPSV newbuilds

Vessel Design Yard Delivery

/status Debt financing Ownership Guarantor Total cost Other

Boa Jarl VS 491 Fosen/

Chinese hull H1’15

60% guaranteed SMN/GIEK,

Eksportkreditt funding NFDS Offshore 2 AS

Boa Offshore & Det

Nordenfjeldske Dampskibsselskab

NOKm ~680

+ interests

28k bhp, 600t winch,

ROV hangar

Boa Heron VS 495 Chinese H2’15 70% bank, CDB & Sinosure Boa PSV AS Boa Offshore & Boa Holding USDm ~75 IMR/light construction

Boa Pelican VS 495 Chinese H2’15 70% bank, CDB & Sinosure Boa PSV AS Boa Offshore & Boa Holding USDm ~75 IMR/light construction

Boa Barge 37 Boa Chinese H2’15 SMN Boa Barges AS Boa Offshore & Boa Holding NOKm ~140 152m semi submersible

Boa Offshore Group – Balance Sheet comments

• NIBD/EBITDA increased to 6.5x from 5.7x Q/Q mainly on debt drawdown on newbuilds (Boa Jarl), dis-agio and dockings (Tugs and BMSI)

• NIBD about to stabilize before decreasing from 2H15

• Boa Offshore Consolidated Cash position per YE 2014 of NOKm 634, up from NOKm 445 in 3Q14

Re-financing of OCV 1.pri bond completed in early October

Dockings and yard stays

Further working capital build on accounts receivables, actions taken (NB: reversed in 1Q15)

New NOKm 50 senior unsecured bond issued in November

• Boa Offshore AS cash of NOKm 186, up from NOKm 88 in 3Q14

Re-financing of Boa OCV in 4Q14

Net debt on MPSV newbuilds reduced from USDm 28.5 to USDm 18.5 in 4Q14

OCV dividend paid in 1Q15 to Boa Offshore AS (post quarter event)

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NIBD/EBITDA LTM and cash

BMSI – SURF Services and Capabilities

12

BMSI capable of providing wide range of offshore installation services including:

• Subsea construction, installation and WROV maintenance and modification services, and Light well

intervention support

• Engineering and design support to projects, and Project management and execution services

• Pipeline remediation services, and Pre-set moorings installation (suction pile deployment etc.)

• Abandonment and decommissioning, subsea clean-up and dive support, and Subsea Pump retrieval

• Accommodations Support – Walk to Work and Basket Transfers.

• The BMSI operating fleet comprise three external vessels and Boa Deep C

• External vessels firm periods ends 2015-2018

• Boa Offshore and BMSI looking into a newbuild vessel to be employed in BMSI as previously stated

• Lower cost, enhanced capabilities and more efficient (fuel consumption etc)

• Delivery 2017 - with Equity partner and limited equity outflow until delivery

• Market neutral exposure, or even scaled back, if global market does not improve from 2017 onwards


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5 Market Outlook


Boa OCV – state of the art vessels

• Boa OCV consist of the two state of the art offshore

construction vessels Boa Deep C and Boa Sub C, built in

2004 and 2007 respectively

• 2014 EBITDA of NOKm 256, down from NOKm 277 Y/Y

• 4Q14 EBITDA of NOKm 77, up from NOKm 67 in 3Q14

and NOKm 66 in 4Q13 – USD/NOK effect

• Sales down Y/Y due to Boa Deep C now on bare-boat rate

• NIBD of NOKbn 1.0, up from NOKm 784 in 3Q14

The 1 pri bond loan re-financed in October 2014, up

to NOKbn 1.2 from NOKm 956 in 3Q14

New Maturity 2019 at NIBOR + 475 (NIBOR floor

200bps) vs previous 2016/NIBOR +550

NIBD/EBITDA LTM of 4.0 per 4Q14

Shipbrokers average valuation NOKbn ~1.9 for both

vessels* per 31.12.14 - Net LTV of 54%

• Long-term outlook for subsea construction vessels remains

prospective, despite oil companies announcing lower

growth and moderation in investments in the short-term on

lower oil prices

• Short-term and long-term opportunities for Deep C and Sub

C from 2015 remains, both through BMSI and third party

users

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Boa OCV key P&L

Tugs and

others Barges

Offshore

Vessels

* Source: According to average of two independent shipbroker valuations per 30.06.2014

Boa SBL – specialized seismic vessels

• Owns two modern seismic vessels being the world’s

first custom built vessels for “EM” seismic, built

2008/2009. On long term contracts to EMGS:

Thalassa firm until Dec’ 2015

Galatea firm until July 2016

• 2014 EBITDA of NOKm 64, up from NOKm 55 in 2013

• 4Q14 EBITDA of NOKm 20, up from NOKm 14 in

3Q14 and NOKm 17 in 4Q13

• Strong operational track record with a commercial on-

hire of > 99% last four years

• Average shipbroker values* of NOKm 590

2014 NIBD of NOKm 338 = net LTV 57%

NIBD/EBITDA of 5,3x

• Although purpose built for EMGS, vessel design is

generic (MT 6000 series) and vessels can be

converted into:

Accommodation support

Traditional 3D seismic/OBN/OBC seismic

Survey/ROV support

IMR/light construction

Offshore Wind Farm support

Boa SBL key P&L

15

Tugs and

others Barges

Offshore

Vessels

* Source: According to average of two independent shipbroker valuations per 30.06.2014

Boa Barges – world leading operator

• Boa Offshore Group today operates 20 barges of

different capabilities (incl. one newbuild) worldwide

• 2014 EBITDA of NOKm 120, up from NOKm 94 in 2013

• Strong 4Q14 positively impacted by a few larger

contracts during the quarter continuing from 3Q14

• 4Q14 EBITDA of NOKm 41, up from NOKm 40 in

3Q14 and NOKm 29 in 4Q13.

• Built up an in-house engineering and project

management capacity that is unique in the industry,

performed from Trondheim and Houston

• Boa Offshore Group has since 1998 had continuous

newbuilding program for barges at Chinese yards, and

from 2002 with its own in-house design on newbuilds

• Boa Offshore offers a unique combination of barges and

tugs to provide total turn-key projects for transportation,

launching or dry docking operations by barges

• First Jacket Launches performed in Mexico this

year

• Has been in involved in several major field developments

world wide

• Tendering activity slower through winter, but a number of

leads for 2015-16 across several industries including; Oil

& Gas, Power, Offshore Wind, Civil Construction

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Tugs and

others Barges

Offshore

Vessels

Boa Barges AS key P&L

Tugs and others

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Tugs and

others Barges

Offshore

Vessels

• 2014 EBITDA NOKm 22 in “other segments” including

eliminations (negative), up from NOKm 4 in 2013

• Negative in 4Q14 in isolation on dockings and yard

stays, slower markets and seasonality

• Boa Offshore AS (parent) relatively strong and

positive

• The “other segments” include 10 tugs, smaller barges,

BMSI, Boa Offshore parent activities and AHTS Boa Bison

• BMSI provides engineering, construction and contracting

services related to fixed and floating offshore platforms

and subsea field developments, based in Houston US.

Supporting vast range of offshore installation

campaigns including: IMR, SURF, and mooring

installations

• Four vessels, Olympic Boa, Boa Deep C, Polar Queen

and Topaz Captain currently chartered to support BMSI’s

strategy

• A number of short/medium term new contracts for

BMSI recently awarded in US GoM and Mexico,

only Boa Deep C now in «spot» next 1-2 quarters

• Market outlook for all of the “other” segment is mixed with

Boa Offshore Parent and Tugs stable, and BMSI and

AHTS more challenging short-term

Tugs and others key P&L


Contents

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5 Market Outlook


Industry Book to Bill as leading indicator for Barges, OCV,

and BMSI

Industry Book to Bill

19 Source: IHS/ODS-Petrodata, Pareto Research, company reports, Boa Offshore

• Although at a declining pace, the order intake YTD

2014 and orderbook per YE 2014 is high in a

historical context for the Big 3 Offshore Majors (Big 3:

Saipem, Subsea7, Technip).

• Lead time for the major projects awarded are in

general 1-3 years

• Indicates a certain level for subsea and offshore

construction activity in years to come, and as a result,

demand for construction vessels and also barges

• This summer Boa Offshore performed a larger

contract for Subsea7 providing a number of barges

and tugs, and engineering services West of Shetland

offshore UK

Subsea tree installations World Wide p.a.

• Despite oil companies current moderation in growth plans, the outlook for the subsea segment remains relatively robust long-term. Short-term, some projects have been postponed/stopped on lower oil prices

• With the ageing infrastructure and accumulated base growing the need for Inspection, Maintenance & Repair (IMR) services increases

• Number of tree installations likely to increase from an average of < 300 p.a. in 2010-2013 up to 400-450 within 2-4 years (all water depths)

• > 350 under construction for 2015

• Beyond 2015 we probably need to see oil prices back above USD70/bbl to see planned developments progress in general

Order intake in USD 000’

20 Source: ODS/IHS, Boa Offshore

Subsea installations US GoM

Active semis/drillship rigs as leading indicator

US GoM Subsea Market

Subsea market US GoM:

• Boa Offshore and BMSI currently operate four subsea vessels in US GoM and Mexico.

• Relatively high activity in US GoM, also from other services than equipment installation like P&A, well stimulation etc.

• Number of semis/drillships working in US GoM currently at 43, up from 38 in 2014 and 35 in 2013

• 9 rolling off in 2015 (need to secure new work), and 7-8 newbuilds entering fixed contracts

• Cost level about to adapt as UDW day rates are down 30- 50% from peak

• Total number of subsea installation campaigns for 2015 has increased to 97, of which almost 70 under construction, approximately 45 campaigns in 2014

• Likely to see some campaigns skewed to the right (as always)

• Current challenge in the US GoM market is increased competition from vessels entering the region

• Slower activity especially in North Sea

• A number of short/medium term new contracts for BMSI recently awarded in US GoM and Mexico, only Boa Deep C now in «spot» next 1-2 quarters

North Sea working rigs vs total rigs*

North Sea AHTS spot Market

North Sea AHTS Market:

• Average AHTS North Sea spot day rates for 2014

close to NOK 400,000 (same level as 2013) despite

demand side been held back by high number of drilling

rigs in yard in 2014 and no vessels needed for FPSO

installations until end October 14

• New drilling and accommodation rigs are entering

North Sea for fixed contracts and rigs have returned

from yard stays

• Current number of working rigs at 84, up from

average of 76 in 2014

• 15-20 new drilling and accommodation rigs in

total 2015-2017

• Risk to older rigs leaving North Sea (or stacked)

after contract expiry

• Net effect working rigs in 2015 Y/Y could still be

positive, adjusted for all yards stays in 2014

• Only 1 FPS installation in 2014 and 3-5 p.a. for 2015-

2017 (FPSs Under Construction/Conversion)

• Limited number of large AHTS newbuilds to enter

market next 2 years from Norwegian yards

• Risk mainly related to level of AHTS spot fleet and

vessels moving into North Sea

• Current «warm» AHTS North Sea spot fleet >

15,000bhp counts < 55 vessels - could be

adequate for decent summer season

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North Sea FPS installations p.a.

Current

Source: IHS/ODS Petrodata, Boa Offshore, Platou Shipbrokers

* Includes Semis, Drllships and Jack-ups

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