Electromagnetic Geoservices Asa · OSL:EMGS
Electromagnetic Geoservices Asa — Q4 2007 Earnings Presentation
32 slides from Electromagnetic Geoservices Asa's earnings presentation, Feb 20, 2008
Slide 1: EMGS ASA Fourth quarter and full year 2007
EMGS ASA Fourth quarter and full year 2007 CEO, Terje Eidesmo CFO, Svein Knudsen Hotel Continental 20 February 2008
Slide 2: Disclaimer
Disclaimer This quarterly presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. Such forward-looking information and statements are based on current expectations, estimates
Slide 3: Group highlights Q4
Group highlights Q4 Increased awareness of EM: A growing list of opportunities Increased acceptance of EMGS’ technology: Significant contract awarded by new client – PEMEX Repeat business and award by super major: Largest EM contract ever awarded
Slide 4: Financials
Financials Financials
Slide 5: Financial highlights
Financial highlights USD million 48.4 45 37.8 35 28.2 25 25.9 Revenues in line with revised guidance Operational cost in line with previous quarter 15 8.8 About 20 percent revenue growth in 2007 5 0.5 Strong balance sheet Q1 Q2 Q3 Q4 -5 -8.0 -15 -13.4
Slide 6: Consolidated income statement
Consolidated income statement USD million Quarterly Full year Q4 2007 Q4 2006 2007 2006 Revenues 28.2 40.4 140.3 117.7 Charter hire, fuel and crew expenses 25.0 21.3 93.8 62.7 Employee expenses 7.7 8.5 32.9 18.2 Other operating expenses 8.9 6.5 25.7 16.2 EBITDA (13.4) 4.2 (12.1) 20.7 Depreciation an
Slide 7: Operations
Operations
Slide 8: Operational development
Operational development M/V Relume M/V Siem Mollie M/V Atlantic Guardian M/V Stad Angler M/V Sasha
Slide 9: Flexible build up of capacity
Flexible build up of capacity Two additional equipment sets ready for launch in 2008 and two more and in 2009 Current charter parties and available vessels in the spot market contains short term flexibility New delivery dates for the more efficient purpose-built vessels: October 2008, February 2009
Slide 10: Opening new markets through multi-client surveys
Opening new markets through multi-client surveys Multi-client (MC) is a very attractive growth opportunity MC will contribute to increasing acceptance of EM and broaden the client base MC will improve access to EM for smaller oil companies In addition, desired effects on both operational efficiency
Slide 11: Market
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Slide 12: Increased awareness of EM technology
Increased awareness of EM technology USD million 160 150 CAGR of 107 per cent since 2002 140.3 140 130 120 117.7 Eight new clients in portfolio in 2007 110 100 90 Initial contracts with new clients today are 80 larger than previous years 70 t en rc 60 pe 7 50 44.0 10 R 40 G CA 30 22.6 21.6 20 10 3.7
Slide 13: Increased acceptance of EM technology
Increased acceptance of EM technology Number of clients Average contract days 49 37 42 37 oil companies in client portfolio 29 Some clients may be out of 27 market for some time 23 A significant part of contracts 14 signed in 2007 are repeat 10 9 customers 8 Average contract size on the rise 2003 20
Slide 14: Accelerating adoption of EM technology
Accelerating adoption of EM technology First adoption of EM by Pemex Three concecutive contracts with super major in seven months Prefunding of world’s largest scanning survey by Indian ONGC Important strategic EM alliances formed Super major signs contract with Pemex ONGC signs contract with Rockso
Slide 15: The key to success in India
The key to success in India 120 India EMGS has worked in India for Discovery trend 100 a number of years 80 The number of discoveries in India are increasing 60 40 Recently, Director General of Hydrocarbons in India cited EMGS as 20 key to success in a public forum 0 2000 2001 2002 2003 2004 2005 20
Slide 16: Technology
Technology
Slide 17: The pioneer and world leader in the EM market
The pioneer and world leader in the EM market EM source towed above receivers EM receivers dropped at seabed Seabed logging indicated reserves EMGS uses EM technology to improve offshore exploration success
Slide 18: Seabed logging and the reservoir lifecycle
Seabed logging and the reservoir lifecycle Scanning 2D 3D Course grid Survey lines Dense grid • Relevant to frontier, young • Relevant to known prospects • Relevant to known prospects and mature basin exploration and fields • Single or multiple survey lines • Coarse grid of survey lines crossing a p
Slide 19: Seabed logging and anticipated product trend
Seabed logging and anticipated product trend 100 % 90 % 2D 80 % 70 % 60 % 2D Scanning 50 % 40 % 30 % 20 % 3D Scanning 10 % 3D 0% 2007 2010
Slide 20: Scanning for exploration leads
Scanning for exploration leads Grid acquisition area response
Slide 21: Troll field: A showcase for EMGS technology
Troll field: A showcase for EMGS technology Troll (Norway) Troll is a geologically interesting and complex oil province The four different surveys provide opportunities to demonstrate the latest technology like grid, scanning, 3D and transcient EM Validates the latest EM imaging technology Source: S
Slide 22: Summary
Summary Growing number of clients Pick up in contract flow Improved technology Successful recruitment Market in an early growth phase
Slide 23: Outlook
Outlook Strong market drivers Focus on triple A: Awareness, Acceptance and Adoption Streamlining organisation, improve efficiency and strengthen international skills Aims for profitable growth in financial year 2008
Slide 24: Q&A
Q&A
Slide 25: Appendix
Appendix
Slide 26: Condensed statement of cash flow
Condensed statement of cash flow USD million Full year 2007 2006 Net cash flow from operating activities (20.7) (4.0) Net cash flow from investing activities (51.0) (14.4) Net cash flow from financial activities 91.9 36.3 Net profit (loss) (30.9) (25.3)
Slide 27: Condensed balance sheet
Condensed balance sheet USD million Full year Full year 31 December 2007 31 December 2006 ASSETS Cash and cash equivalents 40.7 20.5 Trade receivables 32.8 31.9 Other current assets 26.4 8.8 Total current assets 99.9 61.2 Intangible assets 3.3 2.4 Property, plant and equipment 48.3 23.3 Other non-cu
Slide 28: Current fleet
Current fleet M/V Atlantic M/S Siem M/S Sasha Stad Angler OSV Relume Guardian Mollie Date of August 2006 January 2007 January 2007 February 2007 August 2007 refurbishment Charter March 2010 April 2008 August 2008 January 2011 August 2010 expiration
Slide 29: A global platform
A global platform Trondheim Stavanger Oslo London Paris Houston Kuala Lumpur Rio Perth
Slide 30: Ownership (as of February 1)
Ownership (as of February 1) Shareholder Shares Holding 1 WARBURG PINCUS 46,307,312 64.42% 2 STATE STREET BANK AND TRUST CO. 3,278,072 4.42% 3 MORGAN STANLEY & CO INC: 2,157,450 2.91% 4 JPMORGAN CHASE BANK 1,824,300 2.46% 5 BRUHEIM, BJARTE 1,715,302 2.31% 6 BANK OF NEW YORK, BRUSSELS BRANCH 1,336,10
Slide 31: Patent status
Patent status EMGS holds strong patent protections EMGS will continue to defend its patent position in the interest of all stakeholders On 1 February 2008, EMGS participated in an oral patent hearing at the court of The Hague brought by Schlumberger Holdings Ltd.
Slide 32: Slide 32
Electromagnetic Geoservices ASA (EMGS) — Q4 2007 Earnings Presentation on 6ix