Siem Offshore Pareto Securities Oil & Offshore Conferences Sept 2013

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Transcript of Siem Offshore Pareto Securities Oil & Offshore Conferences Sept 2013

  • 1. Siem Offshore Pareto Oil & Offshore Conference 4 September 2013 CEO Terje Sorensen

2. Disclaimer 2 This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. Such forward-looking information and statements are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for Siem Offshore (SIOFF) and its subsidiaries. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for the Siem Offshore businesses, oil prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time. Although Siem Offshore believes that its expectations and the information in this Presentation were based upon reasonable assumptions at the time when they were made, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in this Presentation. Siem Offshore nor any other company within the group is making any representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the information in the Presentation, and neither Siem Offshore , any other company within the group nor any of their directors, officers or employees will have any liability to you or any other persons resulting from your use of the information in the Presentation. Siem Offshore undertakes no obligation to publicly update or revise any forward-looking information or statements in the Presentation. There may have been changes in matters which affect Siem Offshore subsequent to the date of this presentation. Neither the issue nor delivery of this presentation shall under any circumstance create any implication that the information contained herein is correct as of any time subsequent to the date hereof or that the affairs of Siem Offshore has not since changed, and Siem Offshore does not intend, and does not assume any obligation, to update or correct any information included in this presentation. The contents of this presentation are not to be construed as legal, business, investment or tax advice. Each recipient should consult with its own legal, business, investment and tax adviser as to legal, business, investment and tax advice. This presentation is subject to Norwegian law, and any dispute arising in respect of this presentation is subject to the exclusive jurisdiction of the Norwegian courts. 3. Agenda 3 1. Company Overview 2. Update on ongoing projects 3. Market Outlook 4. Appendix b. Financials c. Vessel Employment and Deliveries a. Status 4. Siem Offshore Company Profile 4 Background and status Established in July 2005. Owner and operator of Offshore Support Vessels (OSVs) Main markets for the company currently in the North Sea, Brazil and West Africa. Recent expansion in Subsea Vessel segment (4x newbuilds) Breakthrough in Offshore Renewable Energy segment (Focus on installation of submarine power cables for offshore windfarms). Fleet 38 vessels in operation. 10 vessels under construction. Global Organization Headquarter in Kristiansand, Norway. Regional offices in Brazil, Germany, the Netherlands, the U.S., Ghana and India. Some 1,300 employees (1,100 offshore and 200 onshore). Strong financial position Book equity ratio of approx. 44%, and secured bank debt to market value of fleet at ~50%. Contract backlog of firm contracts for vessels at USD 806m (excluding options) as of 30 June 2013. Contract backlog within submarine power cable activities of approximately USD 180m. Listed on Oslo Stock Exchange Market cap of approximately NOK 3.0bn1) Largest shareholder Siem Industries (34.2%) Note 1: As of close of trading August 28, 2013 5. Key Highlights - Continued growth since 2005 5 0 50 100 150 200 250 300 350 400 2005 2006 2007 2008 2009 2010 2011 2012 FiguresinUSDmillion Operating revenue Operating margin In Operation 19 21 24 25 29 34 39 Ordered Vessels 4 13 14 17 15 9 6 37 10 2005 2006 2007 2008 2009 2010 2011 2012 1) 6. Fleet overview - 38 vessels in operation and 10 vessels under construction Average age vessels in operation PSV ~ 7 years AHTS ~ 3 years OSCV ~ 3 years 1) Incl. two vessels owned by a partner PSV (3,300 4,700 dwt) 6 # 12 # 3 OSCVAHTS Core Drilling Vessel # 1 # 11 Smaller Brazilian vessels Well stimulation vessel # 1 # 101) Vessels in operation Vessels under construction (Delivery 2013, 2014 & 2015) # 2 OSRVOSCV # 3 PSVs # 3 ISV # 1 CLV # 1 7. Breakthrough in Offshore Renewable Energy Market in 2012/2013 with several new contract awards Awarded contract for E.On Germany for the Amrumbank Offshore Windfarm Joint contract with J-Power Systems Corporation (JPS) for the Innogy Nordsee 1 Offshore Wind Farm Project Baltic 2 Offshore Wind Farm project by EnBW Baltic 2 GmbH. Total contract backlog of approx. USD 180 million. Continue to tender for other projects within the Offshore Wind Farm market. Germany and UK the biggest markets. Potential demand for both new installation vessels and maintenance vessels. Siem Offshore Contractors (SOC) - a 100% owned subsidiary of Siem Offshore 7 Formed in 2003 and located in Leer, Germany. Provides complex engineering solutions and services for installation, repair and maintenance of submarine power cables. Competitive advantage in combining installation expertise in SOC and asset base of Siem Offshore Installation support vessel (ISV) and Cable Lay Vessel (CLV) under construction to support SOC in upcoming projects. Company Profile Status and Highlights ISV (Delivery 2014) CLV (Delivery 2015) 8. Signed a back-to-back contract with M-I Swaco, a Schlumberger company, for the Gudrun and Valemon field in the North Sea. The offshore operation is scheduled for execution in second quarter 2014. The new PCD 5000 systems will be mobilized and used for the planned operation. Siem WIS is ready for the Gullfaks operation, which is planned to commence in third quarter 2013. Siem WIS is also in discussions for other projects for utilisation of the pressure control device (PCD). 8 Siem WIS - Technology for Managed Pressure Drilling 9. Scientific Core Drilling JOIDES Resolution Overseas Drilling Limited is the owner of the scientific core drilling vessel JOIDES Resolution. JOIDES Resolution is a dynamically positioned drillship and floating laboratory carrying scientists from all over the world. On time charter until end Sept 2013 with Integrated Ocean Drilling Program (IODP), a research program exploring Earth's history and structure. The time charter includes 10 x 1 year options, of which IODP has exercised the first option (until Sept. 2014). Unique vessel and experience in niche market with high potential profitability. 9 Overseas Drilling Limited - a 100% owned subsidiary of Siem Offshore Joides Resolution - Vessel Specifics Built: 1978 (Major Upgrade 2009) Length: 143 m Breadth: 21 m Gross tonnage: 10,282 t Accommodation: 130 persons Max endurance: 75 days Drilling capacity: 2,000 meters into the seafloor in water depths of up to 7,000 meters Siem Offshore 10. Agenda 10 1. Company Overview 2. Update on newbuilding program 3. Market Outlook OSVs 4. Appendix b. Financials c. Vessel Employment and Deliveries a. Status 11. Income Statement Second Quarter January - June Twelve Months Ended Amounts in USD million 2013 Unaudited 2012 Unaudited 2013 Unaudited 2012 Unaudited 2012 Audited 2011 Audited Operating revenue 92.5 90.9 172.3 181.8 368.2 340.6 Operating expenses ( 51.2) ( 47.7) ( 100.3) ( 98.8) ( 210.8) ( 182.5) Administration expenses ( 9.1) ( 10.4) ( 20.6) ( 20.9) ( 47.1) ( 35.2) Operating margin [1] 32.2 32.8 51.3 62.0 110.3 123.0 Operating margin % 35 % 36 % 30 % 34 % 30 % 36 % Depreciation and amortisation ( 18.3) ( 20.5) ( 36.9) ( 41.6) ( 82.7) ( 81.3) Gain/(Loss) on sale of fixed assets 0.2 0.1 28.6 15.7 14.1 0.4 Gain/(Loss) FX contracts [2] ( 11.1) ( 0.3) ( 12.9) 3.6 12.5 1.5 Net financial items [3] ( 19.5) ( 29.6) ( 26.8) ( 31.9) ( 34.8) ( 47.3) Profit before tax ( 16.5) ( 17.5) 3.3 7.8 19.4 ( 3.8) Income tax provision ( 0.4) ( 0.3) ( 1.4) ( 1.5) ( 4.0) ( 2.7) Net Profit (loss) ( 16.9) ( 17.7) 1.9 6.4 15.4 ( 6.5) Net profit attributable to non-controlling interest ( 0.3) ( 0.1) ( 1.5) ( 1.2) ( 1.9) 0.8 Net profit attributable to shareholders ( 16.6) ( 17.6) 3.4 7.6 17.3 ( 7.3) Earnings per share [4] ( 0.04) ( 0.04) 0.01 0.02 0.04 ( 0.02) Average number of shares outstanding [5] 388,884 395,952 390,588 395,952 395,665 395,902 [1] Operating revenue less operating expenses [2] Revaluation of off-balance sheet currency contracts entered into in order to hedge both operating expenditures and future yard instalments in foreign currencies. [3] Including revaluation of non-USD currency balance sheet items and mark-to-market effects on interest rate derivatives [4] Net profit / Average number of shares outstanding (diluted) [5] Weighted average number of shares outstanding (diluted) ('000) 11 12. 12 Second Quarter January - June Twelve Months Ended Amounts in USD million 2013 Unaudited 2012 Unaudited 2013 Unaudited 2012 Unaudited 2012 Audited Net Profit (loss) ( 16.9) ( 17.7) 1.9 6.4 15.4 Unrealized (profit) loss on currency derivatives 13.7 1.0 18.2 (0.5) (6.9) Unrealized (profit) loss on interest rate derivatives (4.5) 3.3 (6.5) 3.4 5.7 Other unrealized (profit) loss on currency positions 13.6 16.8 14.4 (9.6) (2.8