Helix Energy Solutions Group, Inc. · NYSE:HLX
Helix Energy Solutions — Q3 2009 Earnings Presentation
30 slides from Helix Energy Solutions's earnings presentation, Oct 29, 2009
Slide 1: Third Quarter 2009 Earnings Conference Call
Third Quarter 2009 Earnings Conference Call October 29, 2009
Slide 2: Forward-looking statements
2 This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All such statements, other than statements of historical fact, are statements that could be deemed “forward-looking statemen
Slide 3: Presentation Outline
Summary of Q3 2009 Results (pg. 4) 2009 Outlook (pg. 7) Liquidity and Capital Resources (pg. 10) • Operational Highlights by Segment Contracting Services (pg. 16) Oil & Gas (pg. 24) • Non-GAAP Reconciliations (pg. 27) Well Enhancer helideck Presentation Outline
Slide 4: Executive Summary
(A) Results of Cal Dive, our former Shelf Contracting business, were consolidated through June 10, 2009, at which time our ownership interest dropped below 50%; thereafter, our remaining interest was accounted for under the equity method of accounting until September 23, 2009, when we reduced our ho
Slide 5: Executive Summary
• $17.9 million gain on the sale of 23.2 million shares of Cal Dive stock • $7.1 million of incremental expense recorded as a result of the Company’s weather derivative contract • Expense concentrated in Q3 2009 to coincide with hurricane season vs. straight line expense • Q3 results excluded realiz
Slide 6: Executive Summary (continued)
• Net debt balance decreased by $853 million year-to-date • Oil and gas production totaled 9.8 Bcfe for Q3 2009 versus 12.4 Bcfe in Q2 2009 • Avg realized price for oil $68.86 / bbl ($72.29 / bbl in Q2 2009), including effect of settled hedges • Avg realized price for gas $8.02 / Mcf ($7.62 / Mcf in
Slide 7: Helix Producer I topside module installation
Helix Producer I topside module installation progress at Kiewit Offshore Services fabrication yard
Slide 8: 2009 Outlook
• Express dry-dock, transit and utilization on Danny pipeline is impacting external revenues • Capital expenditures of approximately $340 to $360 million for 2009, $209 million spent year-to-date • $205 million relates to completion of three major vessel projects ( Well Enhancer, Caesar and Helix Pr
Slide 9: 2009 Outlook (continued)
• Production range: 43 - 47 Bcfe • Oil and gas prices • Without hedges: $4.37 /mcfe; $66.41 /bbl • With realized hedges and mark-to- market adjustments (gas only): $7.45 /mcfe; $70.91 /bbl HPI pipe racks connecting production modules to buoy system 2009 Outlook (continued)
Slide 10: Liquidity and Capital Resources
Liquidity and Capital Resources Well Enhancer and Seawell in Aberdeen, Scotland
Slide 11: Significant Balance Sheet Improvements
Debt Liquidity* of $781 million at 9/30/09 * Defined as available revolver capacity plus cash Significant Balance Sheet Improvements
Slide 12: Liquidity and Capital Resources
• Completed (≈ $600 million pre-tax): • Oil and gas assets • Bass Lite sale December 08 & January 09 ($49 million) • EC 316 sale in February 09 ($18 million) • Cal Dive • Sold a total of 15.2 million shares of Cal Dive common stock to Cal Dive in January and June 2009 for aggregate proceeds of $100
Slide 13: Liquidity and Capital Resources: Covenants
Covenant Test Explanation Collateral Coverage Ratio > 1.75 : 1 Basket of collateral to Senior Secured Debt Fixed Charge Coverage Ratio > 2.75 : 1 Consolidated EBITDA to consolidated interest charges Consolidated Leverage Ratio < 3.5 : 1 Consolidated EBITDA to consolidated debt Company is in complian
Slide 14: Credit Facilities, Commitments and Amortization
Credit Facilities, Commitments and Amortization – $435 Million Revolving Credit Facility - UNDRAWN. • Facility extended to November 2012. • In July 2011, commitments reduced to $407 million. • $50 million of LCs in place. – $416 Million Term Loan B - Committed facility through June 2013. $4.3 millio
Slide 15: Operations Highlights
Slide 16: Contracting Services
• Completed the offshore work on the Reliance KGD6 Project in the Bay of Bengal • Express returned from India to the Gulf of Mexico after her regulatory dry-dock in Spain and began spooling the Helix ERT Danny 12-inch pipe in 8-inch pipe (PIP) pipeline at Helix’s new spoolbase in Ingleside, Texas •
Slide 17: Contracting Services
• Olympic Canyon working for Reliance Industries offshore India under long term inspection, repair and maintenance contract • Olympic Triton supporting Technip’s Deep Blue on GOM Projects and will transit to West Africa under contract with Technip • Island Pioneer and Northern Canyon enjoyed high ut
Slide 18: Contracting Services
• Seawell worked the majority of the quarter for Shell under the long term firm contract and also worked for BP, Apache and Venture • Q4000 worked for Chevron and Walter Oil & Gas in well intervention mode in July and for ENI as an accommodation vessel for the rest of the quarter. ENI work was contr
Slide 19: Marine Capital Projects
Well Enhancer generating revenue Caesar completed sea trials offshore China HPI external thruster porches, DTS receptacle and all production modules installed Marine Capital Projects
Slide 20: Helix Producer I
• DTS buoy loaded out and to be installed by Q4000 in November 2009 • Installation of 2,500-ton production modules underway and expected to be completed November with hook-up to follow • Expect deployment in Phoenix field in Q2 2010 HPI production module installation Disconnectable Transfer System H
Slide 21: Contracting Services
(A) Results of Cal Dive, our former Shelf Contracting business, were consolidated through June 10, 2009, at which time our ownership interest dropped below 50%; thereafter, our remaining interest was accounted for under the equity method of accounting until September 23, 2009, when we reduced our ho
Slide 22: Contracting Services
(A) Amounts are before intercompany eliminations. See non-GAAP reconciliation on slides 28-29. Contracting Services
Slide 23: Contracting Services
Contracting Services (A) Includes REM Forza on long-term charter.
Slide 24: Oil & Gas
24 (B) Q2 amounts reflect $11.5 million of impairments related to reduction in carrying values of certain oil and gas properties due to reserve revisions. (C) Includes UK production of 0.1 Bcfe in Q3 2008 and 0.2 Bcfe in Q2 2009. (D) Including effect of settled hedges. Oil & Gas
Slide 25: Oil & Gas
(A) Includes accretion expense. (B) Excludes hurricane-related repairs of $5.1 , $2.3 and $7.4 million, net of insurance recoveries of $0, $0, and $97.7 million, for the quarters ended September 30, 2009, September 30, 2008 and June 30, 2009, respectively. (C) Includes $10.4 million related to a wea
Slide 26: Summary of Oct 2009-Dec 2010 Hedging Positions
Summary of Oct 2009-Dec 2010 Hedging Positions
Slide 27: Non-GAAP Reconciliations
Slide 28: Adjusted EBITDAX
GE HELIX Quarter Ended Nine Months Ended September 30 June 30 September 30 September 30 Adjusted EBITDAX ($ in millions) 2009 2008 2009 2009 2008 Net income applicable to common shareholders $ 4§ 59 $ 100 $ 158 $ 222 Non-cash impairments 1 7 19 20 24 Gain on asset sales (18) 5 9) 68) (60) Preferred
Slide 29: Revenue and Gross Profit As Reported
AS HELIX Revenue and Gross Profit As Reported ($ in millions) Quarter Ended September 30 June 30 2009 2008 2009 Revenues Contracting Services $ 175 $ 276 $ 239 Shelf Contracting - 279 198 Intercompany elim. - Contracting Services (23) (66) (29) Intercompany elim. - Shelf Contracting = (16) (5) Reven
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