Slide 1: First quarter 2020 trading update
8 May 2020 First quarter 2020 trading update Dag Skindlo, President and CEO Espen Joranger, CFO
Slide 2: Disclaimer – forward looking statements
Disclaimer – forward looking statements Cautionary Statement Regarding Forward-Looking Statements In addition to historical information, this presentation contains statements relating to our future business and/or results. These statements include certain projections and business trends that are “fo
Slide 3: Key highlights
Key highlights • Strong operational results for Q1 2020 • Refinancing closed with maturity of main facility in Q4 2023 • Modular rigs mobilized for operations in New Zealand and Norway • Covid-19 and oil price reduction with immediate impact on client activity 3
Slide 4: Key financial highlights Q1 2020
Q1 2020 Key financial highlights Q1 2020 Revenue [$m] EBITDA before exceptional items [$m] EBITDA [$m] 250 225,7 237,1 30 28,1 30 25,9 25,0 200 25 25 21,7 20 20 150 15 15 100 10 10 50 5 5 0 0 0 Q1-19 Q1-20 Q1-19 Q1-20 Q1-19 Q1-20 • Revenue of $237.1 million • EBITDA before exceptional items of $28.1
Slide 5: Archer Group – financial highlights first quarter 2020
Quarterly comparison Archer Group – financial highlights first quarter 2020 Revenue [$m] EBITDA before exceptional items [$m] 300 30 28,1 27,5 25,9 25,1 25,4 236 240 237 250 226 228 25 200 20 150 15 100 10 50 5 0 0 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Capex [$m] Net Interest B
Slide 6: Covid-19 outbreak and significant drop in oil price
Market Covid-19 outbreak and significant drop in oil price • Our clients have reacted to deteriorated • Archer maintained focus on safety and operational outlook and announced investment cuts of 20- performance 30% o Drilling and intervention operation in North Sea • Archer has reacted to reduction
Slide 7: Platform Drilling & Engineering
Q1 2020 Platform Drilling & Engineering Revenue and EBITDA before exceptional items [$m and %] Financial highlights Revenues ($m) EBITDA before exceptional items (%) 150 10% • Revenue up 16% compared to same quarter last year. 125,9 125,6 133,4 133,6 115,5 8% • Exceptional items recorded of $4.1 mil
Slide 8: Platform Drilling market development Q1/Q2 2020
Q1 2020 Platform Drilling market development Q1/Q2 2020 • Our platform drilling clients have initiated a 30-35% reduction in their drilling and P&A PD - contracted rigs* activity. Archer retains the contracts with Active Drilling Rigs Maintenance Mode Rigs reduced crew for maintenance and support 50
Slide 9: Well Services
Q1 2020 Well Services Revenue and EBITDA [$m and %] Financial highlights EBITDA before exceptional items (%) Revenues ($m) 40 34,3 25% • Strong development relative to Q1 2019: 33,6 30 29,7 29,5 29,8 20% - 15.4% increase in Revenue 15% - 60.7% increase in EBITDA 20 10 10% • EBITDA up by 34.6% in Q1
Slide 10: Land Drilling
Q1 2020 Land Drilling Revenue and EBITDA [$m and %] Financial highlights Revenues ($m) 100 EBITDA before exceptional items (%) 20% • Revenue down ~13% relative to same quarter last 80,4 80,3 80 72,3 72,7 70,0 year due to lower drilling activity level 15% 60 • EBITDA before exceptional items of $12 m
Slide 11: QES merger process
Financial investment QES merger process On May 4, QES announced the plan to combine their services with KLX Energy Archer ownership Services in an all-stock merger transaction • Archer currently owns Transaction Highlights approximately 28.1% of the shares in the • Highly complementary product and s
Slide 12: Refinancing completed in April
Refinancing completed Refinancing completed in Historic NIBD and Liquidity [$m] April 850 800 750 144 140 144 121 140 120 700 100 91 650 • Main loan facility extended until October 1, 82 80 600 796 60 2023 550 40 500 603 586 582 589 544 20 • A fixed quarterly amortization schedule with 450 400 0 ins
Slide 13: Summary and financial outlook
Summary and financial outlook Summary Q1 2020 • Strong operational results in Q1 2020 • Completed refinancing securing long term financing and sufficient liquidity • Rapidly adjusting operations, cost and investments to the current market conditions Financial outlook 2020 • Significant uncertainty r
Slide 14: Appendix
Appendix 14
Slide 15: Segment key financials
APPENDIX Segment key financials Eastern Hemisphere Revenues ($m) EBITDA (%) 200 167,0 167,2 15,0 % 145,2 155,4 155,4 150 10,0 % 100 Platform drilling & 5,0 % Engineering 50 0 0,0 % Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 $m Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Well Services Revenues 145.2 155.4 155.4 167.0 167.2 EBI