Slide 1: Borr Drilling – Dynamic opportunists seizes the moment!
Borr Drilling – Dynamic opportunists seizes the moment! The “final” building blocks coming together – a unique company has been constructed in 17 months Convertible bond issuance of USD350million | 15 May 2018
Slide 2: Important information and disclaimer
Important information and disclaimer This presentation (the “Presentation”) has been prepared by Borr Drilling Limited (the “Company”) and sets forth general background information about the Company's activities current as at the date hereof. Information in this Presentation, including forecast fina
Slide 3: Acquiring five premium jack-ups at USD 144m per rig
Acquiring five premium1 jack-ups at USD 144m per rig Five premium jack-ups Fleet consistency across the five new rigs Proven design & drilling packages All rigs are premium Scalable crew training and logistics Optimise inventories and supply chain Operating water depth Feet 400 Hook load capacity Lb
Slide 4: Transaction terms
Transaction terms Sources and uses Signed LOI for rig purchase ▪ An agreement for the acquisition of 5 premium jack-up rigs under Numbers in USDm construction for a total consideration of USD 720m (USD 144m per Convertible capital to be raised {350} rig) - The transaction is conditional upon the Com
Slide 5: We have spent the last 17 months building the leading jack-up drilling company
We have spent the last 17 months building the leading jack-up drilling company 1 Hercules Offshore 2 Transocean 3 PPL Shipyard 4 Paragon Offshore1 5 Newbuild deal World-leading fleet Standard Standard NCW NCW Standard Semi Standard Standard NCW NCW NCW NCS Standard Standard Standard Standard Standar
Slide 6: Best assets acquired at rock-bottom prices
Best assets acquired at rock-bottom prices Premium jack-up fleets1 Attractive entry point Delivered 2011 or later Delivered pre 2011 Newbuild order cost by order date 300 Borr 5 27 2 29 Drilling +5 Borr 4 22 2 24 Drilling 250 +2 Borr 3 20 2 22 Current Drilling newbuilding price Rowan 4 12 16 200 USD
Slide 7: Significant balance sheet flexibility
Significant balance sheet flexibility Unencumbered assets Significant market cap and attractive LTV Rig name Design Build year Broker value M.cap NIBD Remaining capex LTV (NIBD + Rem Capex) LTV (NIBD) 8 80% NIBD + Capex/EV (LTV in %) 7 70% Atla F&G JU2000 2003 USD50m 6 60% EV (USDbn) 5 50% Balder F&
Slide 8: Low leverage
Low leverage Proforma capital structure – before operations Hercules; USD130m consideration Transocean; USD1,182m consideration, USD862m newbuild commitments, USD320m paid to Transocean, USD275m paid to Keppel FELS on closing, USD260m delivery financing secured PPL; USD1,255m consideration, USD1,255
Slide 9: Total debt repayment of years based on average historical rates
Total debt repayment of 2 years based on average historical rates Key assumptions - 29 premium jack-ups in operation Payback in years for USD1.7bn net debt3 Avg. cash Avg. Avg. 8.0 21.0 20.4 Current break-even historical historical Last 10 year Dayrate scenario market for peers 10yrs 5yrs peak 7.0 H
Slide 10: Strong support in the equity market – Schlumberger largest shareholder
Strong support in the equity market – Schlumberger largest shareholder Raised USD 1.9bn equity since December 2016 Strong investor base 10 |
Slide 11: Experienced board with significant shareholder alignment
Experienced board with significant shareholder alignment Tor Olav Troim Patrick Schorn - SLB Fredrik Halvorsen Jan Rask Chairman of Borr Drilling EVP New Ventures Ubon Partners Former CEO Arethusa Former CEO Seadrill Schlumberger Former CEO Seadrill Former CEO Marine Drilling Former CEO Northern Dri
Slide 12: The Borr lifecycle
The Borr lifecycle Getting started Phase I – Value preservation Phase II – Cash-flow Acquired a fleet of 58 rigs Market rigs for profitable employment Actively participated in M&A Add leverage against contract backlog Fire fighting Capitulation Established an operating platform Distribute excess cas
Slide 13: Significant optionality for convert holders
Significant optionality for convert holders Share price performance for drillers from cycle trough to next peak 1 Cycle trough Next peak +1,541% 1,750 Index points (Rebased @ cycle trough) 1,500 1,250 1,000 +702% +595% 750 500 250 0 1980s 1990s 2000s Peer performance: 1980s Peer performance: 1990s P
Slide 14: Structural age problem in the jack-up market
Structural age problem in the jack-up market Rigs over 30 years likely to be scrapped – Rigs over 15 years likely to be excluded from tenders 70 60 • ~450 rigs needed to meet peak jack-up demand Obsolete • ~300 rigs needed to meet current jack-up 50 Question mark demand 40 30 20 10 - 1981 2000 2019
Slide 15: Clear signs of market improvement – history gives good indication of upside
Clear signs of market improvement – history gives good indication of upside Activity is recovering Increase in jack-up rig count in past cycles # of JU tenders 60 140 55 Tenders up 50% +124 in 44 months 50 120 45 40 +100 in 33 months 35 100 30 +88 in 24 months 25 2016 2017 2018 80 Rates recover quic
Slide 16: Why invest in the Borr Drilling convertible bond
Why invest in the Borr Drilling convertible bond Attractive asset entry point… … which offers upside for CB holders1 300 Newbuild order cost by order date Cycle trough Next peak +1,541% 250 1,750 (Rebased @ cycle trough) 200 1,500 USDm 1,250 Index points 150 +702% 1,000 +595% 100 750 Borr Drilling f
Slide 17: Risk factors
Risk factors The Company’s business involves numerous risks. Investors should in particular consider the following: ▪ There is no certainty that the Company’s fleet can be satisfactory employed. ▪ A negative turn in the demand for drilling services can depress the value of the Company's rigs. ▪ A co
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