Gulf Marine Services PLC · LSE:GMS
Gulf Marine Services — H1 2017 Earnings Presentation
29 slides from Gulf Marine Services's earnings presentation, Sep 19, 2017
Slide 1: 2017 Interim Results
2017 Interim Results Gulf Marine Services 19 September 2017 | www.gmsuae.com
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Gulf Marine Services PLC (the "Company") and comprises the slides for a presentation to analysts concerning the Company. This presentation does not constitute or form part of any offer to sell or issue, or invitation to purchase or subscribe for, or
Slide 3: Agenda
Agenda 1 Welcome 2 Financial Review 3 Operational Review 4 Market Prospects 5 Appendices 3
Slide 4: Welcome
Welcome Duncan Anderson CEO 4
Slide 5: Financial Review
Financial Review John Brown CFO 5
Slide 6: Interim Results Summary
Interim Results Summary Cost reduction programme implemented, adjusted EBITDA margin of 59% Adjusted EBITDA Impairment of US$ 7.3 million on a 35-year old US$ 34.5m Small Class SESV, average age of the rest of the fleet is six years Amended bank facility covenants to provide operational and fi
Slide 7: Trading Summary
Trading Summary (US$m) H1 2017 H1 2016 % Change Revenue 58.5 110.4 -47% Revenue decreased by 47% against H1 2016 (comparative of limited use given Revenue from SESVs 58.5 109.5 -47% market downturn) Revenue from non-core fleet - 0.9 -100% Whilst revenue halved, cash cost of sales* as a percentag
Slide 8: Revenue Analysis
Revenue Analysis Revenue by Segment Revenue by Activity H1 2017 H1 2016 Oil and Gas – Opex-led activities 83% 70% Oil and Gas 32% – Capex-led activities 17% 30% 34% H1 2017 1% Revenue by Region H1 2017 H1 2016 34% MENA 72% 77% 35% Small Class Vessels H1 2016 47% Europe 28% 23% Mid-Size Class Vessels
Slide 9: SESV Performance Indicators
SESV Performance Indicators Small Class Mid-Size Class Large Class* Total SESVs (8 vessels) (3 vessels) (3 vessels) (14 vessels) H1 2017 H2 2016 H1 2017 H2 2016 H1 2017 H2 2016 H1 2017 H2 2016 Utilisation 41% 41% 79% 45% 72% 83% 56% 51% Average charter day rate excluding 27 31 42 49 54 59 - - hotel
Slide 10: Capital Structure
Capital Structure (US$m) At 30 June 2017 At 31 December 2016 Cash at Bank 35.9 61.6 Bank Debt 414.1 423.6 Net Debt 378.2 362.0 Obligation under finance lease 38.8 40.1 Total net borrowings reduced in August 2017 by US$ 38.8 million following the termination of a lease on a Small Class vessel Und
Slide 11: Operational Review
Operational Review Duncan Anderson CEO 11
Slide 12: Operational Highlights
Operational Highlights Three new long-term contracts and two new eight-month contracts secured (mainly from 2018 and beyond). All contracts include option periods SESV utilisation of 56% in H1 2017 (H1 2016: 89%) showing 10 percentage points’ improvement on Q4 2016 Large Class and Mid-Size Cla
Slide 13: Cantilever System Update
Cantilever System Update Successful sea trials, commissioning completed and ready for operations First SESV in the world capable of delivering well intervention services previously only carried out by drilling rigs Good interest from IOCs and NOCs looking to reduce their costs The cantilever
Slide 14: Market Prospects
Market Prospects Continue to see good levels of tender activity in Europe and parts of the Middle East Encouraged by demand for GMS SESVs, particularly the Large Class and Mid-Size Class We believe clients will prefer younger technologically-advanced vessels such as GMS SESVs Focus on increasing ves
Slide 15: Q&A: Vessel flexibility – expanding opportunities
Q&A Wind Turbine Topside Well Commissioning & Installation & Maintenance Intervention Accommodation Maintenance Vessel flexibility – expanding opportunities 15
Slide 16: Appendices
Appendices Core Strengths and Competitive Advantage SESV Cantilever System v Drilling Rig Fleet Overview – High specification premium fleet Fleet Overview – Three classes of vessels serve a range of client needs Large Class SESV Overview Mid-Size Class SESV Overview Small Class SESV Ov
Slide 17: Core Strengths and Competitive Advantage
Core Strengths and Competitive Advantage YOUNG TECHNICALLY ADVANCED FLEET The youngest fleet in the industry due to GMS’ new build and replacement programme GMS builds and maintains its fleet at its yard in the UAE to international standards with construction, COST EFFECTIVE modification and repairs
Slide 18: SESV Cantilever System v Drilling Rig
SESV Cantilever System v Drilling Rig GMS is the first to introduce a cantilever capability on a self-propelled SESV, significantly increasing our market opportunities. Allowing delivery of well intervention services previously only carried out by drilling rigs including: Change out of electric su
Slide 19: Fleet Overview: High specification premium fleet
Fleet Overview High specification premium fleet Comparative Vessel Capabilities GMS Jackup Semi- Accommodation WTIVs (3) Mobility Fleet self-propelled fleet drilling rigs subs/Constructi rigs on vessels Rig move Faster jacking time Construction and Maintenance Construction & Flexibility Accurate Lar
Slide 20: Fleet Overview: Three classes of vessels
Fleet Overview Three classes of vessels serve a range of client needs Large Class Mid-Size Class Small Class 4 units 3 units 7 units Avg age: 4 yrs Avg age: 2 yrs Avg age: 13 yrs (10yrs excl Naashi) Water Depth: 65-80m Water Depth: 55m Water Depth: 45m Accommodation for up to 300
Slide 21: Large Class SESV Overview
Large Class SESV Overview Main crane 300 tonnes & 400 tonnes Gusto MSC Heavy oil & gas lifting 2500X design Wind turbine installation Offering higher technical and Four-leg design operational capabilities Stable and more positioning flexibility Faster rig jacking Harsh weather Reduce
Slide 22: Mid-Size Class SESV Overview
Mid-Size Class SESV Overview Main crane Gusto MSC NG1800-X 150 tonne main 15 tonne auxiliary Design Proven technology with Accommodation high reliability and Accommodates 150 people which can be expanded to flexibility 300 Harsh weather capability 55m water depth capability 75m leg lengt
Slide 23: Small Class SESV Overview
Small Class SESV Overview Main crane 36-45 tonnes Wärtsilä design Oil & gas lifting Four-leg design Proven technology with Stable and more positioning high reliability and flexibility flexibility Faster rig move Reduces punch-through risk Units constantly tested and very well known in
Slide 24: Significant Barriers to Entry
Significant Barriers to Entry Successfully operating SESVs in GMS’ markets has a number of challenges for new entrants and incumbents: GMS SHAMAL and GMS SCIROCCO GMS SHAMAL and GMS SCIROCCO 1 Operational Track Record Essential to Secure Contracts 2 Safety Case Required for North West Europe O&G wor
Slide 25: In-House Construction and Modification Facility
In-House Construction and Modification Facility GMS SHAMAL and GMS SCIROCCO Competitive Advantage Full in-house project management and technical supervision capabilities Direct control of new build construction, with cheaper build we are better placed to secure contracts Enhanced offering (bes
Slide 26: Historic Results
Historic Results Operational and financial performance - a successful track record Revenues Adjusted EBITDA (1) and Margin 250 $ 219.7 160 $ 138.5 100% 196.6 m 124.7 124.8 m 184.3 179.4 140 200 106.8 142.6 120 94.6 EBITDA Margin (%) 100 80% 150 106.9 69.5 80 100 60 65% 66% 68% 64% 63% 60% 60% 40 50
Slide 27: Clients – a well-diversified blue chip client base
Clients – a well-diversified blue chip client base Oil and Gas Renewable Energy 27
Slide 28: Board Composition
Board Composition Simon Heale Non-Executive Chairman at Kaz Minerals plc Independent Non- Non-Executive Chairman at Marex Spectron Executive Chairman Multiple previous directorships and executive positions UK Chartered Accountant, degree in Philosophy, Politics and Economics Duncan Anderson
Slide 29: Contact
Contact T: +971 (2) 502 8888 E: IR@gmsuae.com W: www.gmsuae.com John Brown - Chief Financial Officer Anne Toomey - Investor Relations Manager