Gulf Marine Services PLC · LSE:GMS
Gulf Marine Services — FY2016 Earnings Presentation
32 slides from Gulf Marine Services's earnings presentation, Mar 28, 2017
Slide 1: 2016 Full Year Results
2016 Full Year Results Gulf Marine Services 28 March 2017 | www.gmsuae.com
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Gulf Marine Services PLC (the "Company") and comprises the slides for a presentation to analysts concerning the Company. This presentation does not constitute or form part of any offer to sell or issue, or invitation to purchase or subscribe for, or
Slide 3: Introduction
Introduction Duncan Anderson CEO 3
Slide 4: Overview of GMS
Overview of GMS Operator of a fleet of 15 self-propelled self-elevating support vessels (SESVs) SESVs provide a stable platform from which clients perform a wide range of activities throughout the lifecycle of the offshore oil, gas and renewable energy projects Small, Mid-Size and Large Class SE
Slide 5: 2016 Full Year Results Summary
2016 Full Year Results Summary SESV utilisation of 70% despite a challenging Adjusted EBITDA market US$ 106.8 million Six new contracts since interim results (including two long-term) Adjusted EBITDA Margin Secured backlog of US$ 209.2 million as at 1 March 2017 60% New build programme compl
Slide 6: Market Prospects
Market Prospects Increasing tender opportunities in core regions of Europe and the Middle East Clients expected to return focus to production targets Opportunities in decommissioning and renewable energy sectors, Europe Cantilever capability will further expand prospects in well intervention operati
Slide 7: Financial Review
Financial Review John Brown CFO 7
Slide 8: Trading Summary
Trading Summary (US$m) 2016 2015 % Change Revenue 179.4 219.7 -18% Revenue reflects the impact of the sustained low oil price and Revenue from SESVs 178.5 215.3 -17% subsequent pressure on certain charter rates and vessel Revenue from non-core assets 0.9 4.4 -80% demand Adjusted Gross profit 95.6
Slide 9: Revenue Analysis
Revenue Analysis Revenue by Segment in 2016 Revenue by Activity 2016 2015 1% Oil and Gas – Opex-led activities 76% 80% Oil and Gas – Capex-led activities 24% 18% 38% Renewable Energy - 2% 43% Revenue by Region 2016 2015 Small Class Vessels 18% Mid-Size Class Vessels MENA 74% 72% Large Class Vessels
Slide 10: Managing our Costs Appropriately
Managing our Costs Appropriately Expect to deliver the previously announced annualised cash cost saving targets: over 10% in our vessel operating costs over 15% in our general and administrative costs Cost-saving initiatives implemented include: lowering of crew costs and overheads through red
Slide 11: Primary SESV Performance Indicators
Primary SESV Performance Indicators Small Class Mid-Size Class Large Class Total SESVs (8 vessels) (3 vessels) (3 vessels) (14 vessels) 2016 2015 2016 2015 2016 2015 2016 2015 Utilisation 64% 96% 61% 100% 91% 100% 70% 98% Average charter day rate 35 40 51 54 64 82 - - excluding hotel services (US$00
Slide 12: Capital Structure
Capital Structure (US$m) At 31 December 2016 At 31 December 2015 Cash at Bank 61.6 60.8 Bank Debt 423.6 365.1 Net Debt 362.0 304.3 Obligations under finance leases* 40.1 94.6 Strong cash generated from operations of US$ 126.3 million (2015: US$ 125.0 million) Net debt leverage at 31 December 2016 wa
Slide 13: Operating Review
Operating Review Duncan Anderson CEO 13
Slide 14: Expanding Capability through Innovation
Expanding Capability through Innovation Continual technological innovation and design enhancement of our SESVs, providing flexible, efficient and cost-effective offshore support solutions tailored to our clients’ requirements Expanded fleet has significantly increased the scope of GMS’ service o
Slide 15: Cantilever System – Status
Cantilever System – Status Commissioning and testing progressing well, final sea trials expected Q2 2017 First SESV capability to deliver well intervention services previously only carried out by drilling rigs, providing significant cost savings Very encouraging interest from existing and pros
Slide 16: Outlook
Outlook Focus remains on maximising utilisation Increasing tender activity - significant opportunities for GMS in core regions Expect the pace of recovery to build momentum, with utilisation increasing ahead of day rates Optimistic about pioneering cantilever potential – good level of interest from
Slide 17: Thank you – Any Questions?
Thank you — Any Questions? OFFSHORE CONTRACTOR
Slide 18: Appendices
Appendices Clients Core Strengths and Competitive Advantage SESV Cantilever System v Drilling Rig Fleet Overview – High specification premium fleet Fleet Overview – Three classes of vessels serve a range of client needs Large Class SESV Overview Mid-Size Class SESV Overview Small Cla
Slide 19: Clients - a well-diversified blue chip client base
Clients - a well-diversified blue chip client base Oil and Gas Renewable Energy 19
Slide 20: Core Strengths and Competitive Advantage
Core Strengths and Competitive Advantage YOUNG TECHNICALLY ADVANCED FLEET The youngest fleet in the industry due to GMS’ new build and replacement programme. COST EFFECTIVE GMS builds and maintains its fleet at its yard in the UAE to international standards with construction, modification and repair
Slide 21: SESV Cantilever System v Drilling Rig
SESV Cantilever System v Drilling Rig GMS is the first to introduce a cantilever capability on a self-propelled SESV, significantly increasing our market opportunities. Allowing delivery of well intervention services previously only carried out by drilling rigs including: Change out of electric su
Slide 22: Fleet Overview: High specification premium fleet
Fleet Overview High specification premium fleet Comparative Vessel Capabilities GMS Jackup Semi- Accommodation WTIVs (3) Mobility Fleet self-propelled fleet drilling rigs subs/Constructi rigs on vessels Rig move Faster jacking time Construction and Maintenance Construction & ✓ ✗ ✓ ✗ ✗ Flexibility Ac
Slide 23: Fleet Overview
Fleet Overview Three classes of vessels serve a range of client needs Large Class Mid-Size Class Small Class 4 units 3 units 8 units Avg age: 4 yrs Age: 2 yrs Avg age: 12 yrs (9yrs excl Naashi) Water Depth: 65-80m Water Depth: 55m Water Depth: 45m Accommodation for up to 300 peop
Slide 24: Large Class SESV Overview
Large Class SESV Overview The flagship of the GMS fleet Main crane 300 tonnes & 400 tonnes Gusto MSC Heavy oil & gas lifting 2500X design Wind turbine installation Offering higher technical and Four-leg design operational capabilities Stable and more positioning flexibility Faster rig ja
Slide 25: Mid-Size Class SESV Overview
Mid-Size Class SESV Overview New generation addition to the GMS fleet Main crane Gusto MSC NG1800-X 150 tonne main 15 tonne auxiliary Design Proven technology with Accommodation high reliability and Accommodates 150 people which can be expanded to flexibility 300 Harsh weather capability 5
Slide 26: Small Class SESV Overview
Small Class SESV Overview The backbone of the GMS fleet Main crane 36-45 tonnes Wärtsilä design Oil & gas lifting Four-leg design Proven technology with Stable and more positioning high reliability and flexibility flexibility Faster rig move Reduces punch-through risk Units constantly
Slide 27: Significant Barriers to Entry
Significant Barriers to Entry Successfully operating SESVs in GMS’ markets has a number of challenges for new entrants and incumbents: GMS SHAMAL and GMS SCIROCCO GMS SHAMAL and GMS SCIROCCO 1 Operational Track Record Essential to Secure Contracts 2 Safety Case Required for North West Europe O&G wor
Slide 28: In-House Construction and Modification Facility
In-House Construction and Modification Facility GMS SHAMAL and GMS SCIROCCO Competitive Advantage Full in-house project management and technical supervision capabilities Direct control of new build construction, with cheaper build we are better placed to secure contracts Enhanced offering (bes
Slide 29: Fluid and Flexible New Build Programme
Fluid and Flexible New Build Programme 6 months 12 months Procurement of Hull Commissioning Vessel Assembly Construction and Delivery Components Components are produced Hulls and steel structures are The project management and Commissioning. from renowned suppliers outsourced to competitive supervis
Slide 30: Historic Results
Historic Results Operational and financial performance - a successful track record Revenues Adjusted EBITDA (1) and Margin 250 $ 219.7 160 $ 138.5 100% 196.6 m 124.7 124.8 m 184.3 140 200 120 94.6 EBITDA Margin (%) 142.6 100 80% 150 106.9 69.5 80 100 60 66% 68% 64% 65% 63% 60% 40 50 20 0 0 40% 2011A
Slide 31: Board Composition
Board Composition Simon Heale: Non-Executive Chairman at Kaz Minerals plc (Chairman) Non-Executive Chairman at Marex Spectron Independent Non- Multiple previous directorships and executive positions Executive Chairman UK Chartered Accountant , degree in Philosophy, Politics and Economics Dun
Slide 32: Contact
Contact T: +971 (2) 502 8888 E: IR@gmsuae.com W: www.gmsuae.com John Brown - Chief Financial Officer Anne Toomey - Investor Relations Manager