Oceaneering International, Inc. · NYSE:OII
Oceaneering International — Johnson Rice Energy Conference 2016
28 slides from Oceaneering International's conference presentation, Sep 22, 2016
Slide 1: Johnson Rice Energy Conference
Alan R. Curtis Chi f Fi Chief Financial i l Offi Officer Johnson Rice Energy gy Conference September 22, 2016 New Orleans, LA
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements we make in this presentation that express a belief, expectation, or intention are forward looking. Forward-looking statements are generally accompanied by words such as “estimate estimate,” “project project,” “predict predict,” “believe,” “expect,” “anticipate,”
Slide 3: Why Oceaneering?
Why Oceaneering? Global provider of diversified services and products in all phases off the h offshore ff h oilfield ilfi ld life lif cycle l Strong market positions Solid balance sheet and cash flow Return of capital to our shareholders Leveraged to deepwater - longer term, term deepwater
Slide 4: Operating Segments
5 Operating Segments 1. Remotelyy Operated Vehicles ((“ROVs”)) 2. Subsea Products 3. Subsea Projects 4. Asset Integrity 5 Advanced 5. Ad dTTechnologies h l i 4
Slide 5: In All Phases of Offshore Oilfield Life Cycle
In All Phases of Offshore Oilfield Life Cycle PHASE EXPLORATION DEVELOPMENT PRODUCTION DECOMMISSIONING % OII Revenue 10% 50% 35% 5% #1 Market # of Operating # Subsea Tree # Subsea Trees # of Field Driver e g Drilling Floating g Rigs g Installations In Service Abandonments Business Segment P d t Prod
Slide 6: Largest Exposure is in Field Development
Largest Exposure is in Field Development R Revenue Mi Mix 5% 10% 35% 50% Exploration Development Production Decommissioning Source: OII Estimates: 2015 6
Slide 7: Revenue by Business Segment
Revenue by Business Segment First Half 2014 2015 2016* 7% 10% 12% 14% 27% 23% 29% 12% 12% 16% 20% 22% 31% 34% 31% $3.7 Billion $3.1 Billion $1.2 Billion ROV Subsea Products Subsea Projects Asset Integrity Advanced Technologies * Six Months Ended June 30, 2016 7
Slide 8: Remotely Operated Vehicles
23% Remotely Operated Vehicles Revenue Contribution First Half 2016 g p of the Oceaneering Flagship g Franchise 8
Slide 9: Oceaneering ROV Fleet Size
Oceaneering ROV Fleet Size 318 ROV ROVs as off JJune 30 30, 2016 350 318 Vehicle Count at Perriod End 300 250 200 2008 2009 2010 2011 2012 2013 2014 2015 2016 2016 Q1 Q2 9
Slide 10: Floating Rig Demand History
Floating Rig Demand History O Oceaneering i 58% 8% M Market k ShShare as off June J 30 30, 2016 Floaters Contracted % with OII ROVs 300 100% Period End 250 75% 200 with OII ROVs s Conttracted Floating Rigs at P 150 50% %w 100 25% 50 0 0% 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2 2015 Q3 2015 Q
Slide 11: Oceaneering ROV Pricing and Fleet Utilization
Oceaneering ROV Pricing and Fleet Utilization % Fl 55% Fleet U ili i as off JJune 30 Utilization 30, 2016 Revenue / Day on Hire Fleet Utilization $11,000 100% $ $10,000 90% $9,000 80% $8,000 Hire 70% Fleet Utilization ue / Day on H $7 000 $7,000 60% $6,000 50% $5,000 40% Revenu $4 000 $4,000 30% $3,
Slide 12: Subsea Products
31% Subsea Products Manufactured Products Revenue Contribution First Half 2016 Production Control Umbilicals Supplies electric and hydraulic power to subsea trees and injects chemicals h i l iintot reservoirs i andd wellll streams. t Specialty Subsea Hardware Field development hardware used to conne
Slide 13: Subsea Hardware Capex Forecast and Backlog
Subsea Hardware Capex Forecast B kl at JJune 30 Backlog 30, 2016 Subsea Capex, Quest May 2016 SS Products Backlog $1,000 $9,600 SD in Millions acklog, USD iin Millions $8,000 $800 are Capex, US $6 400 $6,400 $600 $4,800 $400 OII SS Products Ba bsea Hardwa $3,200 $200 $1,600 Sub $0 $0 2011 2012 2013
Slide 14: Subsea Installations Forecast
Subsea Installations Forecast Tree Installations SSProducts Revenue 500 $1,500 D in Millions 400 $1,200 ns Revenue, USD ee Installation 300 $900 200 00 $600 OII SSProducts R Tre 100 $300 0 $0 2011 2012 2013 2014 2015 2016F 2017F 2018F 2019F 2020F Source: Quest Offshore, May 2016 14
Slide 15: Subsea Projects
22% Subsea Projects Revenue Contribution First Half 2016 Change out photo and replace with AUV Consist of Project Management, Management Survey Survey, Subsea Installation and IMR Services 15
Slide 16: Subsea Projects Overview
Subsea Projects Overview Assets Available for f this Market Spot or Charter Deepwater Multi-Purpose Supply Vessels Contract Location End 2 Owned Ocean Intervention Spot GOM N/A Ocean Intervention II Spot GOM N/A Ocean Evolution (available 2Q 2017) N/A N/A 4 Chartered with Term Normand Flower Spot
Slide 17: Strong Balance Sheet and Liquidity
Strong Balance Sheet and Liquidity C i lS Capital Sources and d All Allocations i Liquidity (at end of second quarter 2016) o $393 million of cash o $500 million undrawn revolving credit facility, expiring October 2020 o Only $19 million of debt maturities until October 2018 Organic capital expe
Slide 18: Leveraged to Deepwater
Leveraged to Deepwater Projects take years to develop Largely oil reservoirs o With high production flow rates Well capitalized customer base o ~50% 50% revenue from E&P majors in prior 3 years Investment based on long-term commodity price expectations 18
Slide 19: Long Term: Offshore is Essential
Long Term: Offshore is Essential D Deepwater R Remains i SiSignificant ifi Incremental Bbls Existing Fields Bbls 90 Source of Additional ~26Mm B/D Crude Production 80 d Condensate e 70 32% MMB/D 60 Crude and 68% 50 Offshore Onshore 40 Source: Morgan Stanley Research , Wood Mackenzie, Rystad Energy,
Slide 20: Expect Extended Declines from Producing Fields
Expect Extended Declines from Producing Fields New Production from New Fields Decline from Aging Fields 4.0 3.5 3.0 Day Barrels Per D 2.5 2.0 Million B 15 1.5 1.0 0.5 0.0 2014 2015 2016 2017 2018 Inverting Balance presented by Bloomberg; Source data from Rystad 20
Slide 21: 2016 Second Half Outlook
2016 Second Half Outlook Challenged market has not changed Aligning our operations with current activity Forecasting g declines in major j oilfield segments, g , most notably: o ROV: less utilization and lower average revenue per day o Subsea Products: lower throughput and single digit margins
Slide 22: Conclusion
Conclusion Longer term, deepwater is still critical to reserve replenishment Global provider in all phases of offshore oilfield life cycle, with a deepwater p focus Further differentiate with integrated solutions Strong liquidity and cash flow Maintain or grow our market positions Emerge
Slide 23: Supplemental Information
Slide 24: EBITDA Reconciliation to Net Income
EBITDA Reconciliation to Net Income (USD in i millions) illi ) Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measurement. Oceaneering’s management uses EBITDA because we believe that this measurement is a widely accepted financial indicator used by i
Slide 25: Oceaneering ROV Leading Market Position
Oceaneering ROV Leading Market Position R Remotely l OOperated dVVehicles hi l Ownership Drill Support Market Share 315 31% 101 58% OII Subsea 7 Fugro DOF Subsea C-Innovations Helix Saipem TMT Technip Harkand IKM Group Worldwide Fleet Other 174 Floating Rigs Contracted** 1027 Vehicles Vehicles* Sour
Slide 26: Oceaneering ROV Fleet
Oceaneering ROV Fleet G Geographic hi PProfile fil – June J 30 30, 2016 41 31 108 21 53 64 GOM Africa Norway Brazil Asia/Pac Other 318 Vehicles 26
Slide 27: Oceaneering ROVs on Vessels
Oceaneering ROVs on Vessels J June 30 30, 2016 Locations Customers 18 23 46 42 21 26 GOM Africa Norway Other Operators Contractors 88 Vehicles 27
Slide 28: Investor Relations Contact
Investor Relations Contact Suzanne Spera Director Investor Relations Director, 713-329-4707 InvestorRelations@Oceaneering.com 28
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