Knot Offshore Partners Lp · NYSE:KNOP
Knot Offshore Partners Lp — Q3 2023 Earnings Presentation
20 slides from Knot Offshore Partners Lp's earnings presentation, Dec 14, 2023
Slide 1: 3Q 2023 Earnings Presentation
3Q 2023 December 14, 2023 (NYSE:KNOP)
Slide 2: Forward-looking statements
Forward-looking statements This presentation contains certain forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) that reflect management’s current view and involve known and unknown risks and are based upon assumptions and estimates that are inh
Slide 3: 3Q 2023 and subsequent: financial headlines
3Q 2023 and subsequent: financial headlines ▪ 3Q 2023 financial headlines include: − Revenues: $72.7m − Operating income: $20.6m − Net income: $12.6m − Adjusted EDITDA: $48.1m − Closing available liquidity: $58.2m, including $53.2m in cash and cash equivalents ▪ Fleet operated with 98.8% utilization
Slide 4: 3Q 2023 and subsequent: contractual developments
3Q 2023 and subsequent: contractual developments In Brazil: ▪ Windsor Knutsen secured: − an extension on its existing contract with Shell, through to Q1 2025; and − a new time charter commencing February-May 2025 for 2 years fixed ▪ Brasil Knutsen was substituted into the time charter with Equinor p
Slide 5: 3Q 2023 and subsequent: outlook
3Q 2023 and subsequent: outlook ▪ Net-demand outlook remains positive − Limited vessel supply: multi-year orderbook of only 5 vessels between now and end-2025 − Faster pace of new offshore oil production implied by continuing FPSO ordering for shuttle tanker-serviced fields − Significant new offshor
Slide 6: Income statement
Income statement Unaudited, USD thousands 3Q 2023 2Q 2023 1Q 2023 3Q 2022 12 months FY 2022 FY 2021 to 3Q 2023 Time charter and bareboat revenues 72,188 69,924 62,933 67,738 271,129 262,797 269,306 Voyage revenues 10 1,585 7,254 — 13,538 4,689 — Loss of hire insurance recoveries - 1,424 911 — 3,093
Slide 7: Adjusted EBITDA
Adjusted EBITDA Unaudited, USD thousands 3Q 2023 2Q 2023 1Q 2023 3Q 2022 12 months FY 2022 FY 2021 to 3Q 2023 Net income 12,641 (40,390) (1,297) 15,972 (23,019) 58,667 53,876 Interest income (932) (861) (683) (289) (2,948) (822) (2) Interest expense 18,493 18,107 17,369 12,220 69,327 42,604 28,065 D
Slide 8: Balance sheet
Balance sheet Unaudited, USD thousands At Sep 30, At Dec 31, At Sep 30, At Dec 31, 2023 2022 2023 2022 Current assets: Current liabilities: Cash and cash equivalents 53,189 47,579 Current portion of long-term debt 156,797 369,787 Inventories 3,088 5,759 Derivative liabilities — — Amounts due from re
Slide 9: Long-term borrowings
Long-term borrowings Unaudited, USD thousands Original Outstanding at of which Balloon Vessels providing security amount September 30, Current due at 2023 Instalments2 maturity3 1. Loan due January 2024 172,500 14,070 14,070 6,470 Dan Sabia 2. Loan due May 2024 100,000 61,538 61,538 56,923 Hilda 3.
Slide 10: Forward contracted revenue backed by leading energy companies
Forward contracted revenue backed by leading energy companies 3Q 2023(1) 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Contracted period Shell Insurance PetroChina Shell Oil major Windsor 15 . . Charterer’s option 18 20 Operated in the spot market Equinor KNOT Equinor Bodil * 10 . 15 . Agreed co
Slide 11: Forward contract coverage
Forward contract coverage Focus remains on growing utilisation in 2024 www.knotoffshorepartners.com 11
Slide 12: Dropdown inventory held by Sponsor – potential future acquisitions
Dropdown inventory held by Sponsor – potential future acquisitions The acquisition by KNOP of any dropdown vessels in the future is subject to approval of the Partnership’s independent Conflicts Committee, as well as the board of directors of each of KNOP and Knutsen NYK. There can be no assurance t
Slide 13: Continued growth in oil production outlook in Brazil
Continued growth in oil production outlook in Brazil Source: Petrobras Strategic Plan 2024-2028, announcement on November 23, 2023 https://agencia.petrobras.com.br/en/institutional/petrobras-unveils-strategic-plan-2024-2028-featuring-investments-of-usd-102-billion-23-11-2023/ www.knotoffshorepartner
Slide 14: FPSO ordering and deliveries continuing at pace in Brazil
FPSO ordering and deliveries continuing at pace in Brazil Source: Petrobras Strategic Plan 2024-2028, announcement on November 23, 2023 https://agencia.petrobras.com.br/en/institutional/petrobras-unveils-strategic-plan-2024-2028-featuring-investments-of-usd-102-billion-23-11-2023/ www.knotoffshorepa
Slide 15: KNOP attributes – US investor considerations
KNOP attributes – US investor considerations ▪ US investors are directed to the Investors FAQs and US Tax Information sections of KNOP’s website: − https://www.knotoffshorepartners.com/investors/investor-faqs/ − https://www.knotoffshorepartners.com/investors/stock-info/us-tax- information/default.as
Slide 16: KNOP attributes – our investment case
KNOP attributes – our investment case ▪ We are a market leader in the operation of shuttle tankers and our Sponsor has more than 40 years’ experience and investment in this business. ▪ Specialist vessels are critical infrastructure with limited replacement risk required to deliver oil production fro
Slide 17: Summary and near-term priorities
Summary and near-term priorities 3Q 2023 & subsequent: ▪ Utilization − 98.8% for scheduled operations − 97.4% given the scheduled drydockings of Brasil Knutsen and Hilda Knutsen ▪ Generated − Revenues: $72.7m − Operating income: $20.6m − Net income: $12.6m − Adjusted EDITDA: $48.1m ▪ Secured additio
Slide 18: Questions
Questions www.knotoffshorepartners.com 18
Slide 19: Appendix
Appendix www.knotoffshorepartners.com 19
Slide 20: Appendix – Non-GAAP financial measures
Appendix – Non-GAAP financial measures Adjusted EBITDA Adjusted EBITDA refers to earnings before interest, depreciation, taxes, goodwill impairment charge and other financial items. Adjusted EBITDA is a non-GAAP financial measure used by investors to measure our performance. Adjusted EBITDA is used
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