Borr Drilling Limited · NYSE:BORR
Borr Drilling — Investor Presentation (September 2020)
16 slides from Borr Drilling's investor presentation, Sep 22, 2020
Slide 1: Borr Drilling Limited – Creating Further Runway
Borr Drilling Limited Creating Further Runway September 22, 2020
Slide 2: Building the best fleet in the industry…
Building the best fleet in the industry… Dec. 2016 May 2017 Oct. 2017 Mar. 2018 May 2018 Mar. 2019 Today 1 Hercules Offshore 2 Transocean 3 PPL Shipyard 4 Paragon Offshore1 5 Keppel #2 6 Hakuryu-15 World-leading fleet Standard Standard NCW NCW Standard Semi Standard Standard NCW NCS NCS NCS Standard
Slide 3: Before COVID, we were on the way to recovery
Before COVID ….. We were on the way to recovery Increased Utilization and Day Rates Shale coming to a grinding halt impacting US production 450 13.5 400 13 350 12.5 # contracted Jack Up Rigs US Production in MBOPD 300 12 250 11.5 200 11 150 10.5 100 2017 2018 2019 2020 10 Premium jack-up Standard ja
Slide 4: The significance of Shallow Offshore Production
The significance of Shallow Offshore Production Sources of oil Production 17.5m bbl/day of oil production ▪ Shallow water Offshore production at attractive 90 break-even levels 80 Shallow water – Jack-Up market 70 ▪ Total offshore production around 30m BOPD of 60 which 17.5m from shallow water Break
Slide 5: The Jack-Up fleet is old
The Jack-Up fleet is old –30% above 30 years Jack-Up market 600 1968 – 2000 167 rigs ▪ Average Jack Up demand through the cycles in excess of 340 units 500 ▪ 1/3 of the Jack Ups over 30 years old 400 Average demand 342 rigs # Jack-Ups contracted ▪ More of the old units cold stacked 300 355 “modern”
Slide 6: Modern Jack-Ups Gaining Market share
Modern Jack-Ups Gaining Market share Modern jack-up rig count Standard jack-up rig count 300 ▪ In flat to down market the modern Jack Ups are gaining market share 244 250 225 ▪ Marketed utilization of the modern fleet currently at 84% 200 # jack-ups contracted 165 193 ▪ The older units will increasi
Slide 7: Older rigs increasingly likely to be scrapped
Older rigs increasingly likely to be scrapped 198 rigs built before 2010 without contract end-21 Surviving units not enough for a normalised market 600 500 Range of future supply 400 300 454 200 367 346 100 0 Peak demand 15 y avg demand Current demand Source: IHS Petrodata. Only scrapping units buil
Slide 8: The big Jack-Up players today
The big Jack-Up players today Borr can play an active role 101 of 355 modern units – 28% 142 of 522 total units – 27% 20x modern JUs 15x JUs built after 2010 1x legacy rig In discussions with lenders 12x modern JUs 30x modern JUs 9x JUs built after 2010 28x JUs built after 2010 30x modern JUs In Cha
Slide 9: Low cash-breakeven
Low cash-breakeven Illustrative contribution per modern rig for cash break-even SG&A/year USD25m 100 Cash interest (21e) USD45m Stacking cost USD6k/day pr rig 90 80 Bareboat contribution USDk/day Q4 Historic average 70 Contracted 60 60 50 40 30 27 Current market 20 18 8 10 - 5 10 14 23 # rigs in ope
Slide 10: Borr Drilling is vital for Pemex
Borr Drilling is vital for Pemex Pemex production plan Production Pemex K bpd 140 120 100 80 60 40 20 0 Borr Drilling’s JV Opex has delivered 6 wells into production to Pemex to date, Total Borr Drilling with another 6 wells to commence shortly In production To be put into prod Source: Pemex Q2 resu
Slide 11: Balance sheet with options…
Balance sheet with options… Depreciated Loan vs depreciated Liability Size Security Done so far Target value value Remaining $614m Extended 2x before Extension capex Convertible Extension & $350m Unsecured Buying back at discount Bond reduction of principal 3x Keppel Extension of Keppel $260m $570m
Slide 12: Creating an extended runway
Creating an extended runway Current debt amortisation schedule New debt amortisation schedule Targeting to postpone yard debt and commitments further 900 900 769 800 800 No scheduled debt amortisation 700 700 before end 2022 600 562 600 524 524 500 500 400 400 300 300 200 174 174 200 174 87 87 87 87
Slide 13: The Cash Flow Potential
The Cash Flow Potential EBITDA and EV/EBITDA implied pr Jack-Up in Borr Drilling 12.0 80 15y average Peak 70 70 10.0 9.8x 60 8.0 $m in EBITDA per Jack-Up 50 EV/EBITDA 6.0 5.8x 40 31 30 4.0 17 20 1.4x 2.0 3.1x 10 10 - 0 80 100 140 250 Source: Borr Drilling Based on $98 million EV pr rig, Assumes $50k
Slide 14: Borr Drilling Key Attributes
Borr Drilling Key Attributes • The world's largest fleet of new Jack-Ups – 28 rigs with average age of 3 years • Solid management team – expertise in integrated services • Focus on shareholder value – Ability to access capital • Flexible yard debt – low interest and no amortisation • Day-rate requir
Slide 15: DISCLOSURES
DISCLOSURES . Investors should carefully consider the foregoing in connection with investment decision. Working Capital Statement Prospectus Risk Factors and Working Capital Statement In connection with this equity raise and the private placement completed in May, we will file a listing prospectus a
Slide 16: DISCLOSURES - Continued
DISCLOSURES - Continued Mexico Business There are important factors that could cause our actual results, level of activity, performance, liquidity or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by these forward-looking state
Borr Drilling — Investor Presentation (September 2020) on 6ix