Seadrill Limited · NYSE:SDRL
Seadrill — Q2 2007 Earnings Presentation
40 slides from Seadrill's earnings presentation, 2007
Slide 1: Second quarter results 2007 Conference call
Second quarter results 2007 Conference call
Slide 2: Disclaimer
Confidential Disclaimer THIS PRESENTATION AND ITS ENCLOSURES AND APPENDICES (HEREINAFTER JOINTLY REFERRED TO AS THE “PRESENTATION” HAS BEEN PREPARED BY SEADRILL LIMITED. (”SDRL” , “SEADRILL or THE ”COMPANY”) EXCLUSIVELY FOR INFORMATION PURPOSES. THIS PRESENTATION HAS NOT BEEN REVIEWED OR REGISTERED
Slide 3: Contents
3 Contents 2Q results 2007 Current operations Newbuilding program Contract status Human resources Summary
Slide 4: Highlights 2Q 2007
4 Highlights 2Q 2007 Net income of US$42.0 million and EPS of US$0.11 All drilling units in operations with the exception of three jack-ups Two new harsh environment contracts Semi-submersible West Alpha – 3Y at US$460,000 UDW drillship West Navigator – 4Y at US$561,500 Two new contracts
Slide 5: Highlights 2Q 2007 – cont’d
Highlights 2Q 2007 – cont’d On track with delivery of the newbuild program Jack-up West Prospero delivered end of June Tender rig T10 delivered in August All remaining projects in the main progressing as planned Increased exposure to drilling cycle through the orders of three units One n
Slide 6: Condensed Income Statement 2Q 2007
6 Condensed Income Statement 2Q 2007 Actual Actual Unaudited accounts in USD million 2Q07 1Q07 Revenues Operating revenues 307.9 305.9 Reimbursables 44.3 28.2 Other revenues 21.8 145.1 Total revenues 374.0 479.2 Operating expenses Vessel and rig operating expenses 180.9 178.3 Reimbursable expenses 4
Slide 7: Condensed Consolidated Segment Information – Mobile Units
7 Condensed Consolidated Segment Information Mobile Units* Actual Actual Unaudited accounts in USD million 2Q07 1Q07 Operating revenues 166.7 174.1 Reimbursables 11.9 5.1 Other revenues 18.7 18.7 Total revenues 197.3 197.9 Vessel and rig operating expenses 88.8 92.1 Reimbursable expenses 11.0 4.4 De
Slide 8: Condensed Consolidated Segment Information – Tender Rigs
8 Condensed Consolidated Segment Information Tender Rigs Actual Actual Unaudited accounts in USD million 2Q07 1Q07 Operating revenues 55.9 52.9 Reimbursables 4.4 4.0 Other revenues 3.1 3.0 Total revenues 63.4 59.9 Vessel and rig operating expenses 23.8 20.4 Reimbursable expenses 4.2 3.8 Depreciation
Slide 9: Condensed Consolidated Segment Information – Well Services
9 Condensed Consolidated Segment Information Well Services Actual Actual Unaudited accounts in USD million 2Q07 1Q07 Operating revenues 85.3 78.9 Reimbursables 28.0 19.2 Total revenues 113.3 98.1 Vessel and rig operating expenses 68.3 65.7 Reimbursable expenses 27.6 18.8 Depreciation and amortisatio
Slide 10: Condensed Consolidated Balance Sheet
10 Condensed Consolidated Balance Sheet Unaudited accounts in USD million Unaudited accounts in USD million 30.06.07 31.03.07 30.06.07 31.03.07 Current assets Current assets Cash and cash equivalents 322.1 471.6 Receivables 403.6 408.8 Current liabilities Other investments 197.8 122.6 Short-term int
Slide 11: Offshore drilling operations
11 Offshore drilling operations Norway - 4 units 2 Semis 1 Jack-up 1 Drillship Well Service activities Mediterranean - 1 unit 1 Jack-up Current Previous Future Southeast Asia - 14 units West Africa - 3 units 4 Semi-tenders 7 Tender rigs 1 Semi-tender 3 Jack-ups 1 Tender rig 1 Jack-up Two new units s
Slide 12: Three newbuild ordered at quality yards
12 Three newbuild ordered at quality yards Unit Yard Type Turnkey price Delivery West Orion Jurong UDW semi-sub. US$532 mill. 2Q2010 West Gemini Samsung UDW drillship US$598 mill. 2Q2010 West Berani II KFELS Semi-tender US$180 mill. 1Q2010 Increased exposure to the drilling market
Slide 13: 15 newbuild projects
13 15 newbuild projects 3 drillships at Samsung Korea 2 semis at Samsung Korea 2 semis at Daewoo Korea 3 semis at Jurong 1 tender barge 3 jack-ups in Singapore in Malaysia and 1 semi- Singapore tender Building the most modern fleet at quality yards
Slide 14: Status shallow water newbuild projects
14 Status shallow water newbuild projects Deliveries on time and budget
Slide 15: West Phoenix
West 15 Phoenix West Phoenix at Samsung
Slide 16: West Sirius
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Slide 17: West Hercules
17 West Hercules West Hercules at Daewoo
Slide 18: West Polaris at Samsung
18 West Polaris at Samsung
Slide 19: Status deepwater newbuild projects
19 Status deepwater newbuild projects Percentage of total construction period, 1% ≈ 10 days Delivery overall progressing as planned
Slide 20: Remaining risks
20 Remaining risks Major component delays and/or failures Commissioning/testing Knock-on effects from other yard activities Risk mitigation and contingency plans in place
Slide 21: Major components delays/failures
21 Major components delays/failures Example: DAT-cylinders (Direct acting tensioners) Part of the riser tensioner system
Slide 22: Commissioning
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Slide 23: Commissioning
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Slide 24: Commissioning
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Slide 25: Commissioning
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Slide 26: Commissioning
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Slide 27: Commissioning
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Slide 28: Commissioning and testing
28 Commissioning and testing Commissioning ---> yard responsiblility
Slide 29: Newbuild deepwater projects
29 Newbuild deepwater projects • Progress to date generally as planned • So far no catastrophes to report (not even the baby brother of a catastrophe…..) • Still risks remaining First in line … a clear advantage
Slide 30: Committed newbuild installments
30 Committed newbuild installments US$ million 2173 Commited newbuild installments 2,000 1,500 1,000 800 500 550 480 480 500 200 220 160 75 40 20 0 0 Paid 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 Committed newbuild installment schedule amounts to approximately US$5.7 billion T
Slide 31: Contract backlog of US$7.6 billion
31 Contract backlog of US$7.6 billion Deepwater newbuilds US$3,940 mill. Existing deepwater units US$1,700 mill. Jack-up rigs US$780 mill. Tender rigs US$1,200 mill.
Slide 32: Quality contract awards
32 Quality contract awards Unit Customer Dayrate (US$/d) Term Contract value West Sirius Devon 460,000 4 yrs US$672 mill. West Phoenix Total 496,500 3 yrs US$526 mill. West Polaris Exxon 520,000 3 yrs US$569 mill. West Hercules Husky 525,000 3 yrs US$575 mill. West Capella TBN 518,000 5 yrs US$958 m
Slide 33: Contract status floaters
33 Contract status floaters 2007 2008 2009 2010 2011 Customer 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Semi-submersibles West Alpha Statoil US$258,500 US$460,000 4 01.2012 West Venture Norsk Hydro US$235,000 US$235,000 West Phoenix 1 & 2 Total Newbuild - US$502M US$496,500 West Em
Slide 34: Contract status jack-ups
34 Contract status jack-ups 2007 2008 2009 2010 2011 Customer 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Jack-ups West Epsilon Statoil US$308,000 US$308,000 West Atlas 1 Coogee Newbuild - US$129M US$257,500 West Triton 1 ADA Newbuild - US$129M US$275,000 West Ceres Total US$166,000
Slide 35: Contract status tender rigs
35 Contract status tender rigs 2007 2008 2009 2010 2011 Customer 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Tender barges T3 1 PTT US$42' US$51,000 US$58,000 US$74,000 06.2012 T4 Chevron US$46,000 US$85,000 06.2013 T6 1 Carigali/CTOC US$64,000 US$85,500 T7 Chevron US$53,000 T8 Total
Slide 36: Human resources
36 Human resources Currently a pool of 5,400 employees as a basis More than 25 different nationalities Significant organic growth capacity Some 1,900 people to be hired over the next 18 months of which 240 are core crews Recuitment is ahead of plan On track in building a great organization
Slide 37: Strategy
37 Strategy Execute current program as planned Divest older jack-ups Further develop market leader position in the tender rig market Further newbuilds not imminent Financing structures geared at capital repayment MLP’s Sale-leasebacks Gearing Open for consolidation Focus on shareho
Slide 38: Well services strategy
38 Well services strategy Consider separate entity for our wellservices Wellservices development 2002 – 2007 division EBITDA US$ mill. Maintain strong operational focus Focus on growth - organically and through M&A activities Seek OTC listing with the intention to list the company on the Osl
Slide 39: Summary
39 Summary Newbuilding projects in the main progressing as planned Recruitment progressing as planned Acceptable term assignments secured for six out of ten deepwater newbuilds Continued strong market outlook Increased exposure to the drilling market through order of three new units Acti
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