Slide 1: Full Year 2020 Earnings Update
FULL YEAR 2020 EARNINGS UPDATE February 11, 2021 © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 2: Disclaimer
Disclaimer The companies in which SBM Offshore N.V. directly and indirectly owns investments are separate legal entities. In this presentation “SBM Offshore” and “SBM” are sometimes used for convenience where references are made to SBM Offshore N.V. and its subsidiaries in general. These expressions
Slide 3: Value Platforms
Value Platforms 99% OCEAN INFRASTRUCTURE CONTRACTUAL HISTORICAL UPTIME BACKLOG PERFORMANCE GROWING THE CORE NEW ENERGIES GAS & RENEWABLES DIGITAL SERVICES © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 3
Slide 4: Highlights
Highlights NAVIGATING ROBUST TRANSITION THE CRISIS PERFORMANCE IN ACTION © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 4
Slide 5: HSSE & Sustainability
HSSE & Sustainability The Market Our Strategy FY 2020 Financials Outlook © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 6: HSSE
HSSE TOTAL RECORDABLE INJURY FREQUENCY RATE1 CHALLENGE: 1.20 1.00 Increased complexity and risk 0.80 due to COVID-19 0.60 0.40 0.20 0.10 0.00 RESULT: 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2 Sustained Oil Majors Benchmark SBM Offshore performance (1) Per 200k man-hours (2)
Slide 7: Sustainability Performance
Sustainability Performance IMPROVING EXTERNAL RECOGNITION Rating: A Rating: B Rating: #1 amongst peers1 Rating: top 93rd Percentile [AAA= max, CCC=min] [A= max, D- = min] 2020 COMPANY OBJECTIVES TARGET ACTUAL 2020 COMPANY OBJECTIVES TARGET ACTUAL % of the R&D budget allocated to 30% 52% non-carbon t
Slide 8: Flaring – Improvements & Challenges
Flaring – Improvements & Challenges FLARING GHG INTENSITY1 KEY IMPROVEMENTS ON INSTALLED FLEET [Index – 2016 = 100] 100 • Adding newer generation vessels with higher efficiency -50% • Improved process stability and gas compression uptime, supported by Digitalization 75 FPSO LIZA DESTINY 50 • Main ga
Slide 9: The Market
HSSE & Sustainability The Market Our Strategy FY 2020 Financials Outlook © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 10: Total FPSO market potential awards
Total FPSO market potential awards SBM Offshore capacity 14 2+ FPSO projects per year 13 11 12 FPSO awards 10 11 SBM Offshore FPSO awards 10 Potential FPSO awards Break Even <US$40 per barrel 10 9 9 9 Potential FPSO awards Break Even >US$40 per barrel 8 8 7 3 3 3 3 2 0 2 1 1 '11 '12 '13 '14 '15 '16
Slide 11: Total FPSO potential awards areas 2021-2023
Total FPSO potential awards areas 2021-2023 1 1 2 3 1 1 13 3 POTENTIAL FPSO AWARD(S) Source: SBM Offshore market intelligence © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 11
Slide 12: Potential Floating Offshore Wind market
Potential Floating Offshore Wind market EXPECTED FAST-GROWING MARKET 6-12 POTENTIALLY INSTALLED BY 2030 Gigawatt >20 PROJECTS IDENTIFIED (2021-2030) Floating Offshore Wind – Installed capacity (key markets) 6 5 4 Gigawatt 3 KEY FLOATING OFFSHORE WIND AWARD AREAS (2021-2030) 2 France, Japan, Norway,
Slide 13: Our Strategy
HSSE & Sustainability The Market Our Strategy FY 2020 Financials Outlook © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 14: Strategy
Strategy “SBM Offshore believes the oceans will provide the world with safe, sustainable and affordable energy for generations to come. We share our experience to make it happen.” © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 14
Slide 15: Optimize
Optimize WIN EXECUTE OPERATE 99% UPTIME PERFORMANCE & DISCIPLINED & SELECTIVE PROJECTS ON TRACK LOWER EMISSIONS INTENSITY DELIVERING VALUE TO STAKEHOLDERS © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 15
Slide 16: Transform – Developing the FPSO of the future
Transform – Developing the FPSO of the future © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 16
Slide 17: Transform – emissionZERO FPSO
Transform – emissionZEROTM FPSO B A Carbon Capture Modules C Working with vendor to develop carbon capture modules for offshore application A D B Zero Flare Avoiding flaring of gases other than for emergency use C Combined Cycle Power Using the heat from power generation to drive steam turbine that
Slide 18: Innovate – Ambition 2030
Innovate – Ambition 2030 25% OF REVENUES FROM GAS & RENEWABLES BY 2030 Floating Wave Energy LNG TO WIRE LNG TERMINAL Offshore Wind Converter © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 18
Slide 19: Innovate – Building on vast experience
Innovate – Building on vast experience Floating Offshore Wind CAPITALIZING >60 YEARS EXPERIENCE TANGIBLE DEVELOPMENTS Wave Energy Converter INDUSTRIALIZATION © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 19
Slide 20: Delivering value to shareholders
Delivering value to shareholders US$ millions OVER US$1 BILLION RETURNS SINCE 2016 165 196 STABLE AND GROWING DIVIDENDS 166 150 165 OVER US$500 MILLION OF 75 SHARES REPURCHASED SINCE 2016 45 47 51 2016 2017 2018 2019 2020 2021 Dividend Share repurchase © SBM Offshore 2021. All rights reserved. www.s
Slide 21: FY 2020 Financials
HSSE & Sustainability The Market Our Strategy FY 2020 Financials Outlook © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 22: Directional overview
Directional overview1 Revenue (US$ millions) EBITDA (US$ millions) 2,368 Underlying Revenue 2,291 2,171 1,021 921 944 832 Underlying EBITDA FY 2019 FY 2020 FY 2019 FY 2020 Pro-forma backlog (US$ billions) Net debt (US$ billions) 20.7 21.6 3.5 4.1 FY 2019 FY 2020 FY 2019 FY 2020 (1) Directional view,
Slide 23: Financial performance per segment
Financial performance per segment Directional, US$ millions Lease and Operate Turnkey Underlying Revenue Underlying EBITDA Revenue EBITDA 1,622 1,315 1,031 842 856 669 53 FY 2019 FY 2020 FY 2019 FY 2020 FY 2019 FY 2020 -9 FY 2019 FY 2020 FY 2019 FY 2020 FY 2019 FY 2020 FY 2019 FY 2020 “Other” Underl
Slide 24: 2020 Sources and uses of cash
2020 Sources and uses of cash Directional, US$ millions Cash from Operations Debt drawdowns Other Sources of cash 852 1,031 28 Uses of cash 498 155 51 150 21 905 165 44 Debt repayment Interest Dividend Growth Other (including lease liabilities) (Capex + Fast4Ward®) Share Tax Working capital repurcha
Slide 25: Debt supporting L&O projects
Debt supporting L&O projects Directional, US$ billions Assets Liabilities and net assets Group liquidity Property, Plant & Equipment1 0.2 Other Net working capital, provisions Cash and cash equivalents 0.4 and other 0.6 Other net liabilities 0.1 Lease Liabilities (IFRS 16) 0.1 0.3 0.4 Construction p
Slide 26: Pro-forma net cash flow from L&O and BOT
Pro-forma net cash flow from L&O and BOT Directional, US$ millions 25 years of cash flow visibility L&O and BOT net cash translated in EUR/share1 800 18 17 US$21.6 bln 16 Pro-forma 700 backlog 600 TK 0.9 BOT 2.4 500 6% 7% 8% Discount rate 400 300 c. US$260 million average L&O net cash p.a. after tax
Slide 27: Increasing Financing & Cashflow Optionality
Increasing Financing & Cashflow Optionality FPSO PLATFORM RENEWABLE PLATFORM Accelerated equity cash flow BACKLOG BASED FINANCING 1 Equity sell down at project level to accelerate equity cash flow Y0 Y1 Y2 Yn Original Equity New Equity 2 Manage Debt profile to accelerate equity cash flow Lower debt
Slide 28: Pro-forma "in-hand" L&O cash analysis
Pro-forma “in-hand” L&O cash analysis Directional, US$ millions 6 year Pro-forma net cash flow after tax from L&O 450 Millions 300 150 - 2021 2022 2023 2024 2025 2026 6 Year Average L&O Cash flow Avg. 2021-2026 Net Operating Cash after tax ~930 Backlog Debt Redemptions ~(470) Interest ~(120) L&O net
Slide 29: Building track-record of Shareholder returns
Building track-record of Shareholder returns US$ Dividend per share SBM Offshore MSCI Europe Index PHLX Oil Service Sector Index OSX Amsterdam AEX Index 33% Annual growth rate2 1 0.89 100% 100% 0.81 80% 80% 60% 60% 40% 40% 20% 20% 0% 0% 0.37 -20% -20% -40% -40% 0.25 0.23 0.21 -60% -60% -80% -80% -10
Slide 30: Outlook
HSSE & Sustainability The Market Our Strategy FY 2020 Financials Outlook © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 31: 2021 Guidance
2021 Guidance DIRECTIONAL EBITDA Around 900 Mln US$ DIRECTIONAL REVENUES Around 2.6 Bn US$ LEASE & OPERATE Around 1.6 Bn US$ TURNKEY Around 1.0 Bn US$ This guidance includes Directional revenues and EBITDA of US$77 million related to the expected cash receipts in 2021 from the Deep Panuke contract,
Slide 32: Appendix
Appendix © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
Slide 33: Sustainable Development Goals – Company targets for 2021
Sustainable Development Goals – Company targets for 2021 © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com 33
Slide 34: Pro-forma Backlog and borrowings repayment
Pro-forma Backlog1 and borrowings repayment Directional, US$ billions 2 Turnkey TK 0.9 Pro-forma Directional L&O and BOT backlog Backlog BOT 2.4 3.0 2.5 2.0 1.5 L&O 18.3 1.0 L&O BOT Sale 0.5 - 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 20
Slide 35: Pro-forma net cash flow from L&O and BOT
Pro-forma net cash1 flow from L&O and BOT Directional, US$ millions 2 25 years of cash flow visibility L&O and BOT net cash translated in EUR/share3 800 18 17 US$21.6 bln 16 Pro-forma 700 backlog 600 TK 0.9 Turnkey Backlog BOT 2.4 500 6% 7% 8% Discount rate 400 300 c. US$260 million average L&O net
Slide 36: Group P&L and underlying items
Group P&L and underlying items Directional, US$ millions Group P&L Directional underlying items US$ millions FY 2019 FY 2020 Variance US$ millions FY 2019 FY 2020 Impact P&L Revenue 2,171 2,368 197 Deep Panuke redelivery settlement - 77 Revenue Subtotal Revenue impact - 77 Underlying Revenue 2,171 2
Slide 37: Turnkey and Lease and Operate P&L
Turnkey and Lease and Operate P&L Directional, US$ millions Turnkey Comments US$ millions FY 2019 FY 2020 Variance Liza Unity, Prosperity, Sepetiba, Castberg turret mooring Ongoing Projects systems (main EPC activities completed in 2020) Revenue 856 669 (187) Gross Margin 130 48 (82) D, A & I SBM In
Slide 38: 2020 Sources and uses of cash
2020 Sources and uses of cash Directional, US$ millions L&O 1,031 Turnkey (9) Other (78) Underlying EBITDA 944 Deferred income (91) Cash from Operations Debt drawdowns Other Sources of cash 852 1,031 28 Uses of cash 498 155 51 150 21 905 165 44 Debt repayment Interest Dividend Growth Other (includin
Slide 39: Cash Flow Statement
Cash Flow Statement Directional, US$ millions US$ millions FY 2020 EBITDA 1,021 Changes in operating assets and liabilities (274) Income taxes paid (51) Net cash flows from (used in) operating activities 696 Capital expenditures (871) Other investing activities 34 Net cash flows from (used in) inves
Slide 40: Balance Sheet
Balance Sheet Directional, US$ millions Comments on variation US$ millions FY 2019 FY 2020 Variance FPSO Liza Unity, Prosperity and Sepetiba Property, plant & equipment and Intangibles 5,849 6,133 284 partially offset by depreciation and impairments Investment in associates and other financial asset
Slide 41: Lease qualification and consolidation methods IFRS 10 & 11
Lease qualification and consolidation methods IFRS 10 & 11 Joint Ventures Lease Contract Type SBM Share % Directional IFRS FPSO N’Goma FL 50% Proportional Equity FPSO Saxi Batuque FL 50% Proportional Equity FPSO Mondo FL 50% Proportional Equity FPSO Cidade de Ilhabela FL 75% Proportional Full consol
Slide 42: External loans and borrowings
External loans and borrowings Directional, US$ millions Net book value as of December 31, 2020 Full Amount IFRS Directional PROJECT FINANCE FACILITIES DRAWN FPSO Cidade de Paraty 311 311 196 MOPU Deep Panuke 70 70 70 FPSO Cidade de Anchieta 274 274 274 FPSO Cidade de Ilhabela 555 555 416 FPSO N’Goma
Slide 43: Group net debt and borrowings
Group net debt and borrowings Directional, US$ millions Net debt Undrawn facilities + cash 298 3,500 4,093 3,460 383 2,000 500 1,000 -1,000 FY 2019 FY 2020 FY 2020 Lease liabilities RCF Project debt Net cash Undrawn RCF Net cash Undrawn project debt Average cost of debt FY 2020 borrowings and lease
Slide 44: RCF Covenants
RCF Covenants Key financial covenant FY 2020 Definition1 Solvency ratio > 25% ✔ 34% IFRS Tangible net worth divided by total tangible IFRS assets Interest cover ratio > 4.0 ✔ 5.5 Directional Underlying EBITDA divided by net interest payable Represents maximum theoretical lending capacity, calculated
Slide 45: Lease and Operate portfolio
Lease and Operate portfolio (1) FPSO Serpentina is owned by the client and is operated by Gepsing – a subsidiary between SBM Offshore (60%) and GEPetrol (40%) (2) Client change yet to be confirmed as Chevron/Noble Energy transitioning as part of takeover (3) Lease and Operate durations under discuss
Slide 46: © SBM Offshore 2021. All rights reserved. www.sbmoffshore.com
© SBM Offshore 2021. All rights reserved. www.sbmoffshore.com