Sed Energy Holdings Plc · OSL:ENH
Sed Energy — SeaBird Exploration — Q4 2020 Earnings Presentation
43 slides from Sed Energy's earnings presentation, Jan 29, 2021
Slide 1: SeaBird Exploration Fourth quarter 2020 presentation
SeaBird Exploration Fourth quarter 2020 presentation 29 January 2021 CEO, Gunnar Jansen CFO, Erik von Krogh Chairman, Ståle Rodahl
Slide 2: Forward-looking statements
Forward-looking statements All statements contained in this presentation that are not statements of historical facts, including statements on projected operating results, financial position, business strategy and other plans and objectives for future results, constitute forward-looking statements an
Slide 3: Agenda
Agenda Company overview Presentation of Green Minerals Quarterly and annual highlights Market and operational review Financial review Summary Q&A 3
Slide 4: Company overview
Company overview Global provider of marine 2D seismic data acquisition and OBN source services We deliver cost-efficient, high-quality seismic services to maximize asset value for our customers We are a pioneer in marine minerals 4
Slide 5: Company overview
Company overview Global provider of marine 2D seismic data acquisition and OBN source services Founded in Vessels Operations 1997 6 Worldwide The lowest cost seismic A leader in marine minerals on the service provider NCS 5
Slide 6: Overview of seismic services
Overview of seismic services 3D Shallow 2D Seismic Source vessel Maritime Water Acquisition Services Acquisition 6
Slide 7: Return-focused business model
Return-focused business model Deliver solid returns and Capital efficiency Strong balance sheet strong free cash flow Modern, flexible fleet Lean organisation 7
Slide 8: Successful turnaround strategy
Successful turnaround strategy Initiated in 2019 Flexible, asset-light vessel strategy Focused on capital discipline Reorganise into project- and based organization efficient, quality service delivery Cut SG&A by 40% 8
Slide 9: Successful turnaround strategy
Successful turnaround strategy Introduced in November 2019 Results SG&A per quarter • Refinancing of bond loan with bank facility 2,50 • SG&A down by 40% 2,00 1,50 65% smaller headcount USDm • 2021 forecast 1,00 • Number of offices reduced from 3 to 1 0,50 Technical downtime down sharply 0,00 • Q1 1
Slide 10: Outlook: profitability and growth
Outlook: profitability and growth Our ambition Lifting profitability, accelerating growth and creating value for our shareholders Our strategic direction • Outfit the “Fulmar Explorer” as top-of-the-line OBN vessel • Outfit the “Geo Barents” against contracts • Find work for the “Petrel Explorer” in
Slide 11: Green Minerals
a V/V a SeaBird Exploration Sy GREEN MINERALS
Slide 12: Green Minerals
Green Minerals Company presentation Mission Rationale for mining marine minerals Mineral value potential and license process on NCS Exploration techniques and tools Strategy Investment highlights 12
Slide 13: Our mission
Our mission Green Minerals A pioneer in offshore mining and a leader in Marine Minerals on the Norwegian Continental Shelf Our mission: We do this by Deep sea mining enable digitization extraction of helps eliminate the and electrification Marine Minerals huge social cost in and Rare Earth onshore m
Slide 14: Rationale for mining of Marine Minerals
Rationale for mining of Marine Minerals Green Minerals Demand Social Political • Massive need for new source of • 70 % of the world's cobalt is mined in • In May 2018, the US Department of metals as the world electrifies and the D.R. of Congo, significant the Interior published list of 35 digital te
Slide 15: Supporting UN SDGs and EU Green Deal
Supporting 6 UN SDGs and EU Green Deal Green Minerals Providing minerals Fighting child labor Creating Reducing waste Enabling CO2 Reducing for the green while creating sustainable Rare generation and reduction being key deforestation transition sustainable jobs Earth Elements enabling elements in n
Slide 16: Mineral usage and importance
Mineral usage and importance Green Minerals Marine Minerals and RRE´s are critical in the Examples Metal/REE usage in Renewable Energy industry and in modern Renewable Energy/Technology technologies and electric/electronic appliances 3-4x more Cu in EV vs. ICV (1) Lithium, Nickel, Cobalt, Manganese,
Slide 17: What and where
What and where Green Minerals Occurrence: Examples of Typical Poly-metallic Nodules (Ocean Floor) Metals and REE´s Seafloor Massive Sulfides (SMS)(Mid Ocean Ridges) Ferromanganese Crusts (Plateaus/Ridges) Nodules SMS Crusts Iron Iron Iron Manganese Manganese Lead Zinc Barium Copper Copper Copper Cob
Slide 18: Typical minerals on the NCS
Typical minerals on the NCS Green Minerals • SMS and Crusts found in several locations in the Norwegian Sea – UiB, Research activity for 2 decades – NPDs data sampling programs 2018, 2019, 2020 SMS Crusts Iron Iron • SMS samples rich in Barium Manganese – Copper, up to 14 % Copper (Copper) – Zinc, u
Slide 19: Mineral value potential on NCS
Mineral value potential on NCS Green Minerals Mohns & Knipovich Ridges (1030 km) • Play Assessment similar to standards used in Oil & Gas Mean Resource estimate for key Metals* in SMS deposits in Mohns & Knipovich ridges • 6,9M tons Cu • 7,1M tons Zn • 175 tons Au • 10,5K tons Ag Estimated Value • 7
Slide 20: NCS tentative timeline – production license
NCS Tentative timeline – production license Consequence State ownership Public Hearing Opening of Areas Analysis 2019 2020 2023 The Seabed Minerals Act Opening process started Opening approved approved MPD/NPD preparing Plan for CA Survey license License Round Application Production Award 2023 2023
Slide 21: Exploration techniques and tools
Exploration techniques and tools Green Minerals Technology mostly known and commercially available • Satellite imaging • Bathymetry (Multi-beam, Side Scan Sonar) • Electromagnetic Surveys • Magnetomerty • Water chemistry • Hyper spectral imaging • High resolution seismic • Sampling (coring, surface
Slide 22: Production components and functions
Production components and functions Green Minerals 1. Seafloor Mining Tools • Trencher/Feed system or • Crawler/Crusher/Feed system to: • Dig out, Collect, Crush and Feed ore to Vertical transport system 2. Vertical Transport • Mechanical lifting system or • Riser/slurry or air-based pumping system
Slide 23: Aspirational targets
Aspirational targets Green Minerals Exploration One Green Minerals production system: Example: other industry calc, • Granted Survey License within 3 months only for illustration purpose after opening Flow rate: min 5-8000 tonnes/day Utilisation: min 200+ days/year • Awarded 3 Production Licenses by
Slide 24: Our strategic goals
Our strategic goals Green Minerals Short term Green Minerals to be recognized as a pioneer in offshore mining and a leader in Marine Minerals Medium term Green Minerals to win licenses to survey, explore and produce Marine Minerals on the Norwegian Shelf, thereby capitalizing on a NOK 700bn worth of
Slide 25: Investment highlights
Investment highlights Green Minerals • Pursuing a NOK 700bn opportunity A pioneer in • Potential to generate over NOK 4 billion in annual revenues once production system is operational offshore mining • EBITDA margin target >50% and a leader in • Targeting key minerals vital to electrification and d
Slide 26: Quarterly and annual highlights
Quarterly and annual highlights
Slide 27: Highlights
Highlights Full year 2020 • COVID-19 and low oil prices • Costs significantly reduced • Secured long-term bank financing in the first quarter • Positive EBITDA of $0.2m in 2020 (-$5.7m in 2019) with utilization down from 62% to 34% Fourth quarter 2020 • Revenues of $1.9 million ($7.6 million Q4 2019
Slide 28: Market and operational review
Market and operational review
Slide 29: Flexible fleet: niche streamer and source
Flexible fleet: niche streamer and source 5-7 vessels capable of 2D and source operations EAGLE EXPLORER FULMAR PETREL GEO VOYAGER NORDIC EXPLORER EXPLORER EXPLORER BARENTS EXPLORER Status Owned Owned Owned Flex TC Flex TC Flex TC Source Yes Yes NA Yes Yes Yes 2D Yes Yes NA Yes Yes Yes Streamer Sent
Slide 30: Vessel utilization
Vessel utilization Vessel utilization 100% Q4 2020 utilization 80% of 29% Utilization includes 60% Fulmar Explorer, 44 % Eagle Explorer, 42 % Petrel Explorer and 40% Voyager Explorer, 30 % 28 % 29 % but excludes Geo Barents and Nordic 20% Explorer 0% Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 30
Slide 31: Segment operating activity
Segment operating activity Contract revenue by survey type (USD millions) 25,3 25 Q4 revenues relates 3,9 to the OBN source contracts for Voyager Explorer 20 and Eagle Explorer 17,1 15,2 8,7 3D survey in Q1 and 15 3,1 Q2 2020 was 1,5 subcontracted to a 4,5 third party 10 5,2 7,6 12,7 12,5 5 4,4 3,0
Slide 32: Operational update
Operational update Two vessels in operation during the quarter Q4 2020 VESSEL OCT OCT OCT OCT NOV NOV NOV NOV DEC DEC DEC DEC Voyager Explorer (Asia Pacific) • OBN source project in Asia Pacific completed in mid-November VOYAGER Eagle Explorer (US GoM) • Mobilized for OBN source contract in November
Slide 33: Market trends
Market trends Tendering activity returned in Q4 • Sound OBN tendering-activity for work commencing in 2021 • Modest 2D activity – in line with market expectations • Revival of postponed tenders / surveys from previous quarters Ocean bottom seismic • Oil & gas companies’ focus on increased oil recove
Slide 34: Financial review
Financial review
Slide 35: Key figures
Key figures Unaudited figures Q4 2020 Q4 2019 FY 2020 FY 2019 Revenues 1 890 7 636 47 367 45 136 EBITDA (1097) (5 512) 203 (5 638) EBIT (4 903) (10 979) (13 603) (22 379) Profit/(loss) (2 992) (11 817) (13 029) (23 315) Earnings per share (diluted) (0,11) (0,44) (0,48) (1,09) Utilization 29 % 42 % 3
Slide 36: Historical operating comparison
Historical operating comparison Revenues EBITDA (USD millions) (USD millions) 25 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 3 20 2 1,8 1 0,0 15 0 25,3 -1 ( 0,6) 10 ( 1,1) 17,1 -2 -3 -3,8 5 7,6 -4 3,0 1,9 -5 0 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 -6 ( 5,5) Contract revenues Multi-client revenues Total revenues EBITDA Ad
Slide 37: SG&A
SG&A SG&A (USD millions) 1,8 1,7 1,5 1,6 1,4 1,4 * More than 40% 1,2 1,1 reduction from 2H 1,0 2019 to 2H 2020 1,0 0,8 A further reduction is expected in 2021 0,6 0,4 0,2 0,0 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 *) Expenses related to adjustments in the value of share option program has beeen excluded 37
Slide 38: Investments
Investments Capital expenditure (USD millions) 2,5 2,3 Remaining outfitting of Fulmar Explorer has been postponed and will be subject 2,0 to contract award 1,5 Rigging of Geo 1,5 Barents will take place upon contract award 1,0 Outfitting of Fulmar Explorer and rigging of Geo Barents will 0,5 0,3 0,3
Slide 39: Capital structure
Capital structure Capital Structure 80 70 6 60 22 20 Equity ratio of 59% 50 USDm 40 5 Interest-bearing bank debt of USD 30 8.5m 20 41 38 Net interest-bearing 10 debt of USD 2.0m - Assets Equity & liabilities Non-current assets Equity Current assets Cash Non-current liabilities Current liabilities 39
Slide 40: Summary
Summary
Slide 41: Summary
Summary Becoming an enabler for the green transition through Green Minerals Returning capital to shareholders following worst year in industry Continued strong operational performance following turnaround Oil prices and tendering activity turning up Changing focus from restructuring to profitability
Slide 42: Why invest in SeaBird Exploration
Why invest in SeaBird Exploration Lowest cost provider and capital-efficient strategy Modern, flexible fleet adding to cost advantage Delayed projects and higher oil prices likely to spur growth from 2021 Strong balance sheet and fully funded for targeted growth areas Crystalizing values by spinning
Slide 43: Q&A
Q&A