Oceaneering International, Inc. · NYSE:OII
Oceaneering International — Scotia Howard Weil Energy Conference 2016
27 slides from Oceaneering International's conference presentation, Mar 23, 2016
Slide 1: Scotia Howard Weil Energy Conference
Energy Conference Scotia Howard Weil March 23, 2016 New Orleans, LA M. Kevin McEvoy Chief Executive Officer Oceaneering International, Inc. Safe Harbor Statement Statements we make in this presentation that express a belief, expectation, or intention are forward looking. Forward-looking statements a
Slide 2: Why OII?
Why OII? • Global Provider of Diversified Services and Products in All Phases of the Offshore Field Life Cycle • Strong Balance Sheet and Cash Flow • Continue to Maintain or Grow Our Market Positions • Return Capital to Our Shareholders • Experienced Management Team • Adapting and Making Changes
Slide 3: In All Phases of Offshore Oilfield Life Cycle
In All Phases of Offshore Oilfield Life Cycle PHASE EXPLORATION DEVELOPMENT PRODUCTION DECOMMISSIONING #1 Market # of Operating # Subsea Tree # Subsea Trees # of Field Driver Floating Drilling Rigs Installations In Service Abandonments Business Segment P d t Product and Service Revenue • ROV • ROV •
Slide 4: Largest Exposure is in Field Development
Largest Exposure is in Field Development Revenue Mix 5% 10% 35% 50% Exploration Development Production Decommissioning Source: OII Estimates; Updated 2015
Slide 5: Strong Balance Sheet and Liquidity
Strong Balance Sheet and Liquidity Capital Sources and Allocations • Liquidity – $385 Million of Cash at Year Year-end end – No Meaningful Debt Maturities Until October 2018 – $500 Million Undrawn Revolving Credit Facility, Expiring October 2020 • Organic Capital Expenditures – Expect to Range From
Slide 6: Strong Cash Flow (Even in a Down Year)
Strong Cash Flow (Even in a Down Year) (USD in millions) 2014 2015 Net Income $ 428 $ 231 Cash Flow Provided by Operating Activities $ 722 $ 560 Purchases of Property and Equipment (387) (200) Free Cash Flow $ 335 $ 360 Free Cash Flow as a % of Net Income 78% 156%
Slide 7: Free Cash Flow (Through the Cycle)
Free Cash Flow (Through the Cycle) (USD in million, million except for Earnings per Share amounts) “Free Cash Flow” (FCF) is a non-GAAP financial measurement. FCF represents cash flow from operations less organic capital expenditures (i.e., capital expenditures excluding those for business acquisiti
Slide 8: 2016 Free Cash Flow Illustration $1.00 EPS
2016 Free Cash Flow Illustration $1.00 EPS (USD in millions) 2016 Net Income $ 100 Cash Flow Provided by Operating Activities $ 340 P h Purchases off Property P t and d Equipment E i t (175) Free Cash Flow $ 165
Slide 9: Aligning Our Operations with Current Activity
Aligning Our Operations with Current Activity • Reducing Headcount to Match Demand • Organizing More Effectively to Reduce Costs • Integrating I t ti Our O Services S i and d Products P d t to t Offer Off Greater Customer Value
Slide 10: No Guidance for 2016 on Limited Visibility
No Guidance for 2016 on Limited Visibility • Anticipating Lower Global Demand in Offshore Activities Additional Customer Spending Cuts Activities, Cuts, and Fewer Contracted Floating Rigs • Projecting Decreases in Each of Our Oilfield Operating Segments in 2016 than in 2015 • Market Uncertainty Tran
Slide 11: Looking Ahead
Looking Ahead • Utilize Balance Sheet and Free Cash Flow to Reinvest in Equipment and Technologies Technologies, Maintain a Cash Dividend, and Possibly Repurchase Shares • Further Differentiate with Integrated Solutions • Maintain or Grow Our Market Positions • Continue Our Commitment to Safety & Qu
Slide 12: Long Term: Offshore is Essential
Long Term: Offshore is Essential Deepwater Remains Significant Incremental Bbls Existing Fields Bbls 90 Source of Additional ~26Mm B/D Crude Production 80 d Condensate e 70 32% MB/D MM 60 68% Crude and 50 Offshore Onshore 40 Source: Morgan Stanley Research , Wood Mackenzie, Rystad Energy, and Compan
Slide 13: Engineered Products & Services
-Realizin ing —;O through @ practical UUONS Engineered Products & Services
Slide 14: Supplemental Financial Information
Supplemental Financial Information
Slide 15: Earnings Per Share
Earnings Per Share 2015 - $2.34, $2 34 Adjusted $2 $2.87 87 $4.00 $3.00 $2.00 $1.00 $0.00 2008 2009 2010 2011 2012 2013 2014 2015 EPS Adj. EPS
Slide 16: EBITDA
EBITDA (USD in millions) Series 1 $1,000 $750 $500 $250 $0 2008 2009 2010 2011 2012 2013 2014 2015 See Next Slide for Non-GAAP Reconciliation to Net Income
Slide 17: EBITDA Reconciliation to Net Income
EBITDA Reconciliation to Net Income (USD in millions) 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 investors
Slide 18: Business Segments
Business Segments Revenue Operating Income 11% 4% 2% 26% 19% 12% 39% 20% 31% 36% ROV Subsea Products Subsea Projects Asset Integrity Adtech December YTD 2015
Slide 19: Supplemental Market Information
Supplemental Market Information
Slide 20: Floating Rig Demand History
Floating Rig Demand History 300 282 ontracted Flloating Rigss 250 216 200 ear-End Co 150 Ye 100 Source: IHS-Petrodata
Slide 21: Subsea Tree Installation History
Subsea Tree Installation History 395 400 316 300 Tree IInstallationss 200 100 Global Excluding BRZ Source: Quest Offshore Resources – Mean Case Forecast, February 2016
Slide 22: Leading Market Position
Leading Market Position Remotely Operated Vehicles Ownership Drill Support Market Share 315 118 31% 55% OII Subsea 7 Fugro DOF Subsea C-Innovations Helix Saipem TMT Technip Harkand IKM Group Other Worldwide Fleet 216 Floating Rigs Contracted** 1027 Vehicles Vehicles* Source: *OII Estimates - Decembe
Slide 23: OII ROV Fleet
OII ROV Fleet Geographic Profile – December 2015 35 30 103 25 52 70 GOM Africa Norway Brazil Asia/Pac Other 315 Vehicles
Slide 24: OII ROVs on Vessels
OII ROVs on Vessels December 2015 Locations Customers 11 5 31 51 44 22 26 GOM Africa Norway Asia Other Operators Contractors 95 Vehicles
Slide 25: OII ROV Pricing and Fleet Utilization
OII ROV Pricing and Fleet Utilization Revenue / Day on Hire Fleet Utilization $11,000 100% $9,000 90% $7,000 80% $5 000 $5,000 70% $3,000 60% $1,000 50% December YTD
Slide 26: Leading Market Position
Leading Market Position Specialty Subsea Products Umbilicals Tooling & Subsea Work Systems Installation and Workover Control Systems Subsea Hardware
Slide 27: Subsea Products Backlog
Subsea Products Backlog At Period End (USD in millions) $1,000 $800 $600 $400 $200 $0 2008 2009 2010 2011 2012 2013 2014 2015
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