Subsea 7 S.a. · OSL:SUBC
Subsea 7 — Q3 2011 Earnings Presentation
21 slides from Subsea 7's earnings presentation, Nov 3, 2011
Slide 1: Earnings Presentation Third Quarter 2011
Exhibit 99.2 Earnings Presentation Third Quarter 2011 November 2, 2011 12:00 noon UK time
Slide 2: Forward-looking statements
Forward-looking statements Certain statements made in this announcement may include “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the US Securities Exchange Act of 1934. These statements may be identified by the use of words like “anticipate,
Slide 3: Highlights
Highlights • Good quarter in line with our expectations: – Higher activity levels in the North Sea, although financial results impacted by lower margins on contracts awarded in 2009/10. Some project delays due to incidents and poor weather pushing work into Q4 and early 2012 – Strong performance in
Slide 4: Income statement highlights
Income statement highlights Three Months Ten Months Nine Months Ended Ended Ended In $ millions, except share and per share data Sep.30.11 Aug.31.10 Sep.30.11 Sep.30.11 Unaudited Unaudited Unaudited Unaudited Revenue from continuing operations 1,432 495 4,059 3,843 Net operating income from continui
Slide 5: Operational performance – Q3 2011
Operational performance – Q3 2011 $637m $44m $599m $38m $13m $155m $109m $13m 2-Nov-11 Page 5
Slide 6: Income statement overview – Q3 2011
Income statement overview – Q3 2011 • Administrative expenses of $95 million included $15 million of integration costs • Strong contribution from joint ventures including gain in NKT Flexibles arising from escalation factor in first Brazilian Frame Agreement signed in 2008 • Investment income of $5
Slide 7: Cash flow and balance sheet overview – YTD 2011
Cash flow and balance sheet overview – YTD 2011 • Cash generation from operating activities of $283 million • Net cashflows used in investing activities of $44 million reflects: • Capex in line with expectations: Seven Borealis; Antares, Seven Havila and dry- docks • Net cashflows used in financing
Slide 8: Financial assumptions
Financial assumptions • Integration costs: $41 million expensed YTD – anticipate c.$20 million in Q4 2011 and c.$30 million in 2012 • Capital Expenditure for 2011: – $535 million YTD, including $190 million for Seven Havila – c.$150-200 million expected for Q4 2011, including c.$60 million for Seven
Slide 9: Market overview (1)
Market overview (1) • Expect further major contracts to be awarded in next 6 – 12 months worldwide • Despite recent economic and political uncertainties – no change to client behaviour • Outlook for our industry remain very positive • High levels of tendering activities continue to underpin strong o
Slide 10: Market overview (2)
Market overview (2) • Conventional in West Africa: Award of Ofon II Project shows strong local presence, fabrication yards and differentiating assets continues to position us well to play leading role • SURF: Continue to see growth opportunities in all major markets, albeit at differing paces: – Nor
Slide 11: Outlook for 2012
Outlook for 2012 • Subsea 7 will continue to position itself successfully next year for further profitable growth while continuing to deliver good results • West Africa expected to transition through a period of lower offshore activity on those projects awarded over the past 18 months • West Africa
Slide 12: Summary
Summary • Delivered good quarter in line with our expectations with good results and good order flow • Approaching the future with confidence, despite continued economic uncertainties • Opportunities in nearly all our markets with increasing activity; albeit at differing pace in different geographic
Slide 13: Appendix
Appendix 11-May-11 2-Nov-11 Page 13 13
Slide 14: Major project progression
Major project progression Continuing projects >$100m between 5% and 95% complete as at September 30, 2011 excl. long-term ship charters and Life-of-Field day-rate contracts. Block 18 GEL (Angola) PazFlor (Angola) Oso Re (Nigeria) EGP3B (Nigeria) Block 31 (Angola) CLOV (Angola) Gumusut (Malaysia) P55
Slide 15: Backlog
Backlog In $ millions as at: Sep.30.11 Jun.30.11 Sep.30.10 Aug.31.10 (1) Subsea 7 S.A. 7,903 7,883 - - Acergy S.A. - - - 3,496 Subsea 7 Inc - - 2,884 - (1) Backlog refers to expected future revenue under signed contracts, which are determined as likely to be performed, but excludes amounts related t
Slide 16: Segmental analysis
Segmental analysis: Three months ended Total – Sep.30.11 NSMC AFGoM APME Brazil CORP Continuing Unaudited operations In $ millions Revenue 637.1 599.1 37.9 154.5 3.3 1,431.9 Net operating income 44.0 109.4 12.9 12.7 20.6 199.6 Investment income 5.0 Other gains 45.9 Finance costs (8.7) Net income bef
Slide 17: Segmental analysis
Segmental analysis: Ten months ended Total – Sep.30.11 NSMC AFGoM APME Brazil CORP Continuing Unaudited operations In $ millions Revenue 1,468.3 1,937.8 142.7 500.0 10.2 4,059.0 Net operating 81.6 378.3 25.2 33.8 (15.1) 503.8 (loss)/income Investment income 14.0 Other gains 14.8 Finance costs (31.1)
Slide 18: Adjusted EBITDA
Adjusted EBITDA • The Group calculates adjusted earnings before interest, income taxation, depreciation and amortisation (‘Adjusted EBITDA’) from continuing operations as net income from continuing operations plus finance costs, other gains and losses, taxation, depreciation and amortisation and adj
Slide 19: Reconciliation of net operating income to Adjusted EBITDA
Reconciliation of net operating income to Adjusted EBITDA Three Months Ended Three Months Ended Sep.30.11 Aug.31.10 Total Total In $ millions (except percentages) Continuing Discontinued Continuing Discontinued operations operations Net operating income 199.6 - 199.6 88.7 7.5 96.2 Depreciation and a
Slide 20: Reconciliation of net income to Adjusted EBITDA
Reconciliation of net income to Adjusted EBITDA Three Months Ended Three Months Ended Sep.30.11 Aug.31.10 Total Total In $ millions (except percentages) Continuing Discontinued Continuing Discontinued operations operations Net income 172.8 - 172.8 58.9 5.5 64.4 Depreciation and amortisation 75.1 - 7
Slide 21: seabed-to-surface
seabed-to-surface www.subsea7.com 10.01.11 Page 21