Tidewater Inc. · NYSE:TDW
Tidewater — Jefferies Annual Shipping & Offshore Services Conference 2009
36 slides from Tidewater's conference presentation, Sep 11, 2009
Slide 1: Jefferies Annual Shipping & Offshore Services Conference
TIDEWATER September 9, 2009 Dean E. Taylor Chairman, President & CEO Joseph M. Bennett Executive Vice President and Chief Investor Relations Officer Exhibit 99.1 TIDEWATER JEFFERIES JEFFERIES ANNUAL ANNUAL SHIPPING SHIPPING & & OFFSHORE SERVICES CONFERENCE OFFSHORE SERVICES CONFERENCE Dean E. Taylor
Slide 2: Forward-Looking Statements
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the Company notes that certain statements set forth in this presentation provide other than historical information and are forward looking. The actual achievement of any forecasted results, or the
Slide 3: Safety Record Rivals Leading Companies
2002 2003 2004 2005 2006 2007 2008 TIDEWATER DOW CHEMICAL DUPONT EXXON/MOBIL BP 0.00 0.25 0.50 0.75 1.00 SAFETY RECORD RIVALS SAFETY RECORD RIVALS LEADING COMPANIES LEADING COMPANIES Total Recordable Incident Rates Calendar Years
Slide 4: A Reminder of Our Workplace
A REMINDER OF A REMINDER OF OUR WORKPLACE OUR WORKPLACE
Slide 5: Tidewater Today
5 Solid safety record – Unmatched (and growing) global footprint Entire fleet earning solid returns Strong balance sheet Continuing to invest in new vessels with expanded capabilities Track record of prudent capital management and of returning capital to shareholders TIDEWATER TIDEWATER TODAY TODAY
Slide 6: Our Strategy
6 Culture is a competitive advantage • Safety-oriented • Deep knowledge of customer needs • Aggressive management of operating and capital costs Maintain maximum financial flexibility to deal with uncertainties Selectively deploy cash to renew fleet with expanded capabilities Opportunistically utili
Slide 7: TDW's Financial Stability During Trying Times
7 Cash on the balance sheet Low debt, and no net debt at 6/30/09 Undrawn, new, expanded credit facility Manageable new construction backlog Solid customer base (large exposure to NOC’s and IOC’s) Good contract coverage TDW’s FINANCIAL STABILITY TDW’s FINANCIAL STABILITY DURING TRYING TIMES DURING TR
Slide 8: Strong Balance Sheet
+ $750 million of Available Liquidity at 7/31/09 (Cash plus $450m Revolver) $300 $300 Long-term Debt* $2,245 $2,280 Stockholders’ Equity 2.1% 0% Net Debt* to Total Cap $251 $315 Cash March 2009 June 2009 ($ in Millions) STRONG BALANCE SHEET STRONG BALANCE SHEET + $750 million of Available Liquidity
Slide 9: Selected Financial Highlights
* Adjusted Net Earnings and Adjusted EPS for the quarter ended 6/30/09 excludes $47.7 million, or $0.93 per share, related to provision for Venezuelan operations ($ in Thousands, Except Except Per Share Data) Quarters Ended $1.64 $1.79 Adjusted EPS* $84,776 $92,222 Adjusted Net Earnings* $90,997 $70
Slide 10: Vessel Population by Owner
Tidewater Competitor #2 Competitor #3 Competitor #4 Competitor # 5 Competitor #1 Avg. All Others (1,589 total vessels for 300+ owners) 277 92 83 72 64 61 5 (Includes AHTS and PSV’s only) (Includes AHTS and PSV’s only) VESSEL POPULATION VESSEL POPULATION BY OWNER BY OWNER Estimated as of June 200 9 E
Slide 11: Global Vessel Fleet by Age
0 50 100 150 200 250 1965 1970 1975 1980 1985 1990 1995 2000 2005 Of the total 2,238 vessels, 337 vessels are 30+ yrs old , 93 GLOBAL VESSEL GLOBAL VESSEL FLEET BY AGE FLEET BY AGE (Includes AHTS and PSV’s only) (Includes AHTS and PSV’s only) Estimated as of June 200 9 Estimated as of June 200 9 As
Slide 12: International Strength
12 Unique global footprint; 50+ years of Int’l experience 1Q FY ‘10, Int’l was 92.1% of revenues & 97.4% of profits, (excluding provision for Venezuelan ops ) 43 of 45 of current newbuilds in Int’l yards Longer contracts, better utilization, higher dayrates for new & traditional vessels operating in
Slide 13: Tidewater Today: International Strength
Active Vessel Count By Region (excludes stacked vessels) 94% International 6% Domestic (vs. 65% International and 35% Domestic ten years ago) North America 19 (6%) (6%) Central/South America 81 (25%) (25%) West Africa 136 (43%) (43%) Europe/M.E. 37 (12%) (12%) Far East 45 (14%) (14%) 94% Internation
Slide 14: Growing Industry's Largest Fleet
Strive for a Balance Between Performance, Growth and Financial Strength Ability to support continued fleet renewal and growth Current environment will present opportunities to utilize our financial strength Funding with internal cash flow and available credit Always weigh build vs. buy criteria Maki
Slide 15: Largest New Fleet in the Industry
Vessel Commitments Jan. ’00 – June ‘0 9 (1) Includes vessels added to the fleet financed by bareboat charter. (2) $2,372m funded through 6/30/09. *Excludes ENSCO fleet acquisition effected April 1, 2003. At 6/30/09, 147 new vessels in fleet with 5.0 year average age $1,360m 72 PSV’s $2,944m (2) 207
Slide 16: And Counting: Vessels Under Construction
Estimated delivery schedule – 22 remaining in FY’ 10, 9 in FY’ 11, 11 in FY’ 12 and 2 thereafter. CAPX of $272m remaining in FY’ 10, $153m in FY’ 11, $135m in FY’ 12 and $12m in FY’ 13 Building vessels worldwide Due diligence focused on yards Tidewater staff supervise on site Vessels Under Construct
Slide 17: Financial Strategy
Renew Fleet Deliver Results Maintain Financial Strength FINANCIAL STRATEGY FINANCIAL STRATEGY Renew Fleet Deliver Results Maintain Financial Strength Focused on Long Term Shareholder Value Focused on Long Term Shareholder Value
Slide 18: Jefferies Annual Shipping & Offshore Services Conference
TIDEWATER September 9, 2009 Dean E. Taylor Chairman, President & CEO Joseph M. Bennett Executive Vice President and Chief Investor Relations Officer TIDEWATER JEFFERIES 6 JEFFERIES 6 ANNUAL SHIPPING & ANNUAL SHIPPING & OFFSHORE SERVICES CONFERENCE OFFSHORE SERVICES CONFERENCE Dean E. Taylor Chairman
Slide 19: Appendix
TIDEWATER TIDEWATER APPENDIX APPENDIX
Slide 20: Many Unanswered Questions at This Time
20 Impacts of current financial crisis and global recession Rig and vessel construction backlogs Financial health of shipyards and competitor Future oil and gas prices E&P spending Obama administration’s approach to energy and tax policy Vessel utilization and pricing • • MANY UNANSWERED MANY UNANSW
Slide 21: Returning Value to Shareholders: Share Repurchase Program
Current repurchase authority of $200 MM Since 8/05, have repurchased 9.5 MM shares for $516.2 MM Recent dividend declaration increased from $.15/share/quarter to $.25/share/quarter One of eight OSX companies paying dividends Current 2.3% yield (highest among OSX companies) 21 SHARE REPURCHASE PROGRA
Slide 22: Vessel / Rig Ratio
22 2,238 Global Vessel Count (AHTS & PSV only) 550 Global Working Rigs 4.1 Vessel to Rig Ratio 158 New rigs under construction Current Vessel Demand Dynamics: Possible Incremental Vessel Demand: (???Cancellations???) VESSEL / RIG RATIO VESSEL / RIG RATIO Source: ODS-Petrodata and Tidewater Estimated
Slide 23: Working Rig Counts
Jackups Semi Drillships June 2008 379 145 30 June 2009 317 151 38 Variance (62) 6 8 23 GOM accounts for 40 of the 62 working jackup count variance GOM accounts for 40 of the 62 working jackup count variance Source: ODS-Petrodata and Tidewater WORKING RIG COUNTS WORKING RIG COUNTS
Slide 24: Quality of Customer Base
NOC's 23% Others 37% Super Majors 40% Our top 10 customers (5 Super Majors, 4 NOC’s and one large independent) currently account for 60% of our revenue Our top 10 customers (5 Super Majors, 4 NOC’s and one large independent) currently account for 60% of our revenue CURRENT REVENUE MIX CURRENT REVENU
Slide 25: Rigs Contracted by Our Top 10 Customers
* PEMEX alone has 31 of the 84 jackups Jackups Semi Drillships June 2009 working rigs 317 151 38 Working for top 10 customers 84 76 24 RIGS CONTRACTED BY RIGS CONTRACTED BY OUR TOP 10 CUSTOMERS OUR TOP 10 CUSTOMERS (Estimated as of June 2009) (Estimated as of June 2009) * PEMEX alone has 31 of the 8
Slide 26: Improving Average Age of Tidewater Fleet
Assumptions: 1) Average 45 vessel disposals per year in future (averaged 47 per year last three years). 2) Include 46 vessels under construction in year delivered plus additional newbuilds/acquisitions from approximately $500 million per year of future commitments. Tidewater is not committed to spen
Slide 27: Largest New Fleet in the Industry
(A) Net new vessels added to the fleet since January 2000, including 45 vessels under construction at 6/30/09. Out With the Old – In With the New 0 100 200 300 400 500 Active Fleet Dispositions 363 (B) (B) 470 (C) (C) 192 New Vessels (A) (A) 381 Sold 89 Scrapped (C) 470 vessel dispositions generated
Slide 28: Fleet Cash Operating Margins
$0 $100 $200 $300 $400 $500 $600 $700 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Fiscal Years Note: Cash operating margins are defined as vessel revenue less vessel operating expenses. Traditional Vessels New Vessels FLEET CASH FLEET CASH OPERATING MARGINS OPERATING MARGINS 50% 40% 30% 20% 10
Slide 29: Significant Earnings Growth
$0.00 $2.00 $4.00 $6.00 $8.00 Fiscal 2004 Fiscal 2005 Fiscal 2006 Fiscal 2007 Fiscal 2008 Fiscal 2009 50% Five-Year Compounded Annual Earnings Growth Rate ** EPS in Fiscal 2004 is exclusive of the $.30 per share after tax impairment charge. EPS in Fiscal 2006 is exclusive of the $.74 per share after
Slide 30: International Vessels Dayrates and Utilization
6/06 12/06 6/07 12/07 6/08 12/08 6/09 30 $100 change in dayrate = $9.4M in revenue 1% change in utilization = $15.7M in revenue * Dayrate and utilization information is for all classes of vessels operating international. 50% 60% 70% 80% 90% $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 INTERNATIONAL
Slide 31: International Vessel Dayrates
$3,000 $5,000 $7,000 $9,000 $11,000 $13,000 $15,000 $17,000 $19,000 Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 * Dayrate information is for all classes of vessels operating internationally. 31 New Vessels Traditional Vessels INTERNATIONAL INTERNATIONAL VESSEL VESSEL DAYRATES DAYRATES
Slide 32: Domestic Vessels Dayrates and Utilization
6/06 12/06 6/07 12/07 6/08 12/08 6/09 32 * Dayrate and utilization information is for all classes of vessels operating in the U.S. 40% 50% 60% 70% 80% 90% $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 DOMESTIC VESSELS DOMESTIC VESSELS Dayrates and Utilization Dayrates and Utilization Utilizat
Slide 33: Domestic Vessel Dayrates
$3,000 $5,000 $7,000 $9,000 $11,000 $13,000 $15,000 $17,000 $19,000 Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 * Dayrate information is for all classes of vessels operating in the U.S. 33 New Vessels Traditional Vessels DOMESTIC VESSEL DOMESTIC VESSEL DAYRATES DAYRATES
Slide 34: Superior Operating Capabilities Drive Our Competitive Advantage
34 – Safety-oriented culture – Deep knowledge of customer needs – Worldwide market presence (over 60 countries) – Long-term relationships with major operators (Over 200 customers) – Most new vessels in industry – Wide range of equipment types – “Lean” operations and overhead – Aggressive constructio
Slide 35: Vessel Acquisition Alternatives
35 Usually one-off purchases, often to match specific client needs Immediate delivery Entry price at “full” market rate Built to Tidewater quality standards 18 + months to delivery Potential shipyard backlog Contract terms (e.g., fixed price, LDs, etc.) Resource requirements to oversee construction
Slide 36: Considerations in Designing Our Optimal Vessel Mix
36 Custom/ Specialized Standardized Small Ultra big Renew existing Expand to niche markets Drilling, production Subsea, maintenance, LNG etc. Cycle timers Invest across cycle *Arrows are illustrative of Tidewater’s current views; they should not be interpreted as excluding other points on the contin
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