BW Offshore Limited · OSL:BWO
BW Offshore — Q4 2020 Earnings Presentation
32 slides from BW Offshore's earnings presentation, Feb 19, 2021
Slide 1: BW Offshore Q4 2020
BW Offshore Q4 2020 19 February 2021 CEO Marco Beenen CFO Ståle Andreassen
Slide 2: Disclaimer
Disclaimer This Presentation has been produced by BW Offshore Limited exclusively for information purposes. This presentation may not beredistributed, in whole or in part, to any other person. This document contains certain forward-looking statements relating to the business, financial performance a
Slide 3: FPSO Espoir Ivoirien accident
FPSO Espoir Ivoirien accident The accident Accident investigation • FPSO Espoir Ivoirien, located offshore Cote • Following an initial investigation and implementation d’Ivoire, is operated by BW Offshore for CNR of corrective actions the unit re-started operations International on 13 February 2021
Slide 4: Highlights
Highlights • Challenging COVID-19 year, protecting people and our Creating a floating wind champion operations • FY 2020 EBITDA of USD 436 million and operating cash flow of USD 387 million Progressing FPSO tenders for • Q4 EBITDA of USD 92 million new infrastructure type projects • Includes USD 22
Slide 5: Operational update
Operational update
Slide 6: Successfully reduced COVID-19 costs
Successfully reduced • Risk management, planning and COVID-19 costs procedures in place to efficiently manage operational impact • Main operational challenges relate to crew logistics • Two units affected in Q1 2021 • COVID-19 management related costs reduced to USD ~2 million per month during Q4 •
Slide 7: Fleet performance and HSE focus
Fleet performance and HSE focus Fleet uptime1 HSE record (LTM) 99,4 % 99,7 % 99,9 % 99,0 % 97,3 % 99,4 % 97,8 % 93,2 % 5,0 LTI (2) TRI (3) HPI (4) 4,0 3,0 2,0 1,0 0,0 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 BWO prioritises safety first in
Slide 8: Unit update
Unit update BW Catcher • Production at 45,868 bopd • Commercial uptime of ~100% • Some operational interruptions in Q4 affecting the uptime Abo extension • Option declared for one-year extension to Q4 2021 • Options until Q2 2023 Umuroa • Demobilisation progressing well • Costs of disconnection cove
Slide 9: Fleet contract overview
Fleet contract overview Unit 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 BW Adolo BW Energy, Gabon: 2018-2028 (2038)* BW Pioneer Murphy Oil, US: 2012-2025 (2030) BW Catcher Prem ier Oil, UK: 2018-2025 (2043) Petróleo Nautipa VAALCO, Gabon: 2002-2022 Yúum K’ak’ Náab Pem ex, Mexico: 2007-20
Slide 10: Backlog provides long-term financial visibility
Backlog provides long-term financial FPSO revenue backlog per Q4 2020 visibility Total backlog of USD 4.0 billion at end of Q4 Firm backlog of USD 2.6 billion 19% • >80% of firm backlog from BW Adolo, BW Catcher and BW Pioneer 37% • Premier Oil will be renamed Harbour Energy Plc following the merger
Slide 11: BWE highlights from Q4
BWE highlights from Q4 EBITDA of USD 28 million with two • Q4 gross production 1.24 million liftings completed to BWE in Q4 2020 bbls, equal to ~13,500 bbls/day • Preparing for drilling of the Hibiscus extension exploration well before completing Tortue phase 2 Capital raise of USD 75 million in Jan
Slide 12: Positioning for the future
Positioning for the future STRATEGY AND OUTLOOK
Slide 13: Staying relevant in a changing landscape
Staying relevant in a changing landscape Strategic objectives Financial objectives Predictable 15% ROE Evolving core business as oil and gas will remain an integral part of the global energy mix Shareholder Cash flow visibility value growth Capture energy transition opportunities by developing adjac
Slide 14: Three focus areas
Three focus areas • Contract extensions and redeployments Maximise value from • Value creation in cooperation with BW Energy existing FPSO fleet • Dividend potential as a ~35% shareholder • Sell or recycle units if redeployment opportunities do not materialise Transition to ‘Floating • Long-term FPS
Slide 15: Positioning BW Offshore for the future
Positioning BW Offshore 1 FPSO projects 2 3 • Targeting newbuild FPSO • Investing in a technology • Heads of Terms with for the future FID in H1 2021 and project development company leading U.S. renewable energy and utility company • Firm contract periods of ~15 years + options • Creating a floating
Slide 16: Targeting newbuild FPSO FID in first half 2021
Targeting newbuild FPSO FID in first half 2021 New project characteristics Strict investment criteria • ~15% return on equity (ROE) requirement • ROE hurdle rate expected to be met during firm period Ensuring access to competitive financing • Maturing partnerships with global infrastructure equity i
Slide 17: A catalyst for accelerating growth
A catalyst for • Combination creates a global accelerating integrated floating offshore wind company with market-leading growth capabilities • Expected to own ~50% of the renamed BW Ideol post a BW Offshore investing in Ideol to contemplated capital raise and create floating offshore wind listing on
Slide 18: A solid partner
artner A solid. ; FINANCE
Slide 19: Stable contribution from operations over time
Stable contribution Full-year operating revenue Full-year EBITDA2 from operations over time1 886 USD Million 458 USD million 1 200 500 1 000 400 800 300 600 400 200 200 100 0 0 2 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 1) Comparative periods have been restated to reflect the FPSO business
Slide 20: Healthy underlying EBITDA performance in Q4
Healthy underlying EBITDA Operating revenue EBITDA2 performance in Q41 223 USD Million 114 USD million 300 200 • Lower COVID-19 costs in Q4 180 • Improved terms for Espoir Ivoirien 250 160 agreed 200 140 • USD 10 million impact on 120 Q4 2020 150 100 • One-off inventory impairment on 80 100 FPSO fle
Slide 21: Income statement
Income statement1 USD million Q4 2020 Q3 2020 2020 2019 Operating revenues 222.5 195.1 886.3 947.4 Operating expenses (130.6) (97.0) (450.2) (404.5) EBITDA 91.9 98.1 436.1 542.9 Depreciation & Amortisation (62.3) (63.0) (284.0) (356.1) Impairment (59.6) - (292.7) - Gain (loss) sale of assets - - - (
Slide 22: Cash flow overview
Cash flow overview USD million 300 250 7 200 54 90 13 150 6 12 225 100 171 158 151 142 142 140 140 50 0 Cash 01.10.2020 Operating cash flow Investments Net debt reduction Payment of net interest Dividends paid Payment to non- Cash 31.12.2020 and lease liabilities controlling interest 22
Slide 23: Solid financial position
Solid financial position Net debt and leverage ratio Equity ratio USD million 2 000 50% 3,0x 2,6x 2,3x 2,1x 2,1x Post spin-off of BWE and asset impairment 1,9x 1,8x 1,8x 2,0x 2,0x 40% 36,5% 1 500 30% Post spin-off of BWE 0 1 000 936 20% 500 10% 0 0% Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3
Slide 24: Instalment profile provides financial flexibility
Instalment profile provides financial flexibility Gross debt (USD million end Q4 20) Instalment schedule (USD million) 1 200 1200 1 000 1000 800 800 600 600 400 400 200 200 122 0 0 1 2021 2022 2023 2024 2025 Convertible bond 1 NOK bonds 2 Petróleo Nautipa facility BW Catcher facility Corporate facil
Slide 25: Maintaining financial flexibility and returning capital
Maintaining financial flexibility and returning capital Financial flexibility through Actively Focused on shareholder partnerships & strategic managing liquidity returns investments Maturing partnerships with global Planned USD 25 million fleet capex in Quarterly cash dividend of USD 0.035 infrastru
Slide 26: Summary and outlook
Summary and outlook Protecting people and operations amid lingering COVID-19 pandemic Continued stable EBITDA performance Strong financial flexibility Progressing new and accretive FPSO prospects Combined with Ideol to create integrated floating wind company Progress BW Ideol towards listing 26
Slide 27: Q&A
Q&A We engineer offshore production solutions to progress the future of energy.
Slide 28: Income Statement
Income Statement Q4 2018* FY 2018* Q1 2019* Q2 2019* Q3 2019* Q4 2019* FY 2019* Q1 2020 Q2 2020 Q3 2020 Q4 2020 FY 2020 CONTINUING OPERATIONS Operating revenue 246.6 862.2 230.5 251.2 237.7 228.0 947.4 257.7 211.0 195.1 222.5 886.3 Operating expenses (112.8) (395.6) (94.0) (95.8) (104.8) (109.9) (40
Slide 29: Balance sheet
Balance sheet ASSETS Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Vessels and vessels under construction 2 614.6 2 555.5 2 498.3 2 431.8 2 377.1 2 107.2 2 053.5 2 001.1 1 893.1 Property, plant & equipment 13.3 13.3 14.1 14.6 16.0 4.4 4.3 4.2 4.1 Right-of-use assets - 23.0
Slide 30: Cash flow
Cash flow Q4 2018 FY 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 FY 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 FY 2020 Profit/(loss) before taxes 24.4 76.8 53.0 50.7 33.3 47.3 184.3 (297.0) 36.5 22.2 (33.7) (272.0) Unrealised currency exchange loss/(gain) (15.7) (13.3) 0.6 4.9 (16.9) 1.7 (9.7) (9.3) 7.0 2.5 10.6
Slide 31: Key figures
Key figures Q4 2018 FY 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 FY 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 FY 2020 EBITDA-margin 58.3 % 56.2 % 63.0 % 67.0 % 60.7 % 55.8 % 61.6 % 50.4 % 55.1 % 50.3 % 41.3 % 49.2 % Equity ratio 38.7 % 38.7 % 39.6 % 40.5 % 40.8 % 43.3 % 43.3 % 35.0 % 35.8 % 37.5 % 36.5 % 36.5
Slide 32: Thank you.
Thank you. BW OFFSHORE