Helix Energy Solutions Group, Inc. · NYSE:HLX
Helix Energy Solutions — Q3 2020 Earnings Presentation
27 slides from Helix Energy Solutions's earnings presentation, Oct 22, 2020
Slide 1: 2020 3rd Quarter Conference Call
2020 3rd Quarter Conference Call October 22, 2020
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements that involve risks, uncertainties and assumptions that could cause our results to differ materially from those expressed or implied by such forward-looking statements. All statements, other than statements of historical
Slide 3: Presentation Outline
PRESENTATION OUTLINE • Executive Summary (pg. 4) • Operational Highlights by Segment (pg. 9) • Key Financial Metrics (pg. 17) • 2020 Outlook (pg. 20) • Non-GAAP Reconciliations (pg. 25) • Questions and Answers 3
Slide 4: Executive Summary
Executive Summary 4
Slide 5: Executive Summary
EXECUTIVE SUMMARY ($ in millions, except per share data, unaudited) Three Months Ended Nine Months Ended 9/30/20 9/30/19 6/30/20 9/30/20 9/30/19 Revenues $ 193 $ 213 $ 199 $ 574 $ 581 Gross profit $ 35 $ 55 $ 30 $ 66 $ 111 18% 26% 15% 12% 19% 1 Net income $ 25 $ 32 $ 5 $ 18 $ 50 Diluted earnings per
Slide 6: Executive Summary - Highlights
EXECUTIVE SUMMARY - HIGHLIGHTS Q3 2020 • Net income1 of $25 million, $0.16 per diluted share • Adjusted EBITDA2 of $53 million • Operating cash flows of $53 million • Free Cash Flow2 of $51 million, includes $2 million in capital spending Q3 2020 Year to date • Net income1 of $18 million, $0.10 per
Slide 7: Executive Summary – Q3 2020 Operations
EXECUTIVE SUMMARY – Q3 2020 OPERATIONS Well Intervention • Utilization of 68% across the well intervention vessel fleet • 92% in the GOM • 31% in the North Sea and West Africa; Q7000 and Seawell warm-stacked • 99% in Brazil • 15K IRS utilization 16%; 10K IRS idle during quarter Robotics • Robotics c
Slide 8: Executive Summary – Balance Sheet
EXECUTIVE SUMMARY – BALANCE SHEET Q3 2020 • Cash and cash equivalents of $259 million • Liquidity1 of $404 million • Long-term debt2 of $357 million • Net debt3 of $98 million Debt Refinancing • In August 2020, Helix issued $200 million of Convertible Notes due 2026 and purchased capped calls result
Slide 9: Operational Highlights by Segment
Operational Highlights by Segment 9
Slide 10: COVID-19 and Market Events
COVID-19 AND MARKET EVENTS • The ongoing COVID-19 pandemic and its impact on the global economy have resulted in weaker oil prices and caused significant disruption and uncertainty in the oil and gas market • The COVID-19 pandemic has created challenges for our operations, in particular crew changes
Slide 11: Business Segment Results
BUSINESS SEGMENT RESULTS ($ in millions, unaudited) Three Months Ended Nine Months Ended 9/30/20 9/30/19 6/30/20 9/30/20 9/30/19 Revenues Well Intervention $ 141 $ 170 $ 146 $ 427 $ 452 Robotics 50 52 51 136 136 Production Facilities 14 14 14 43 45 Intercompany Eliminations (11) (23) (11) (33) (51)
Slide 12: Well Intervention – Gulf of Mexico
WELL INTERVENTION – GULF OF MEXICO Gulf of Mexico • Q5000 – 100% utilized in Q3 for BP • Q4000 – 85% utilized in Q3; completed a two-well production enhancement campaign for one customer; performed decommissioning work for another customer; commenced a production enhancement project for a third cust
Slide 13: Well Intervention – North Sea and West Africa
WELL INTERVENTION – NORTH SEA AND WEST AFRICA North Sea and West Africa • Well Enhancer – 92% utilized in Q3; performed production enhancement and diving work for three customers and abandonment work for another customer • Seawell – vessel warm-stacked in Leith • Q7000 – vessel warm-stacked in Tener
Slide 14: Well Intervention – Brazil
WELL INTERVENTION – BRAZIL Brazil • Siem Helix 1 – 99% utilized in Q3; performed abandonment scopes on three wells • Siem Helix 2 – 98% utilized in Q3; performed workover and production enhancement operations on two wells and abandonment scopes on two wells 14
Slide 15: Robotics
ROBOTICS • Grand Canyon II (Asia Pacific) – 100% utilized in Q3 performing ROV support work on wind farm project offshore Taiwan • Grand Canyon III (North Sea) – 73% utilized in Q3 primarily performing renewables trenching operations for one customer • Spot Vessels – 291 total days of spot vessel ut
Slide 16: Utilization
UTILIZATION 100% 97% 95% 95% 96% 80% 72% 68% 60% Q3 2020 Q2 2020 40% 44% Q3 2019 37% 34% 20% 0% Well Intervention Vessels Robotics Support Vessels ROVs, Trenchers and ROVDrill • Q5000 • Siem Helix 11 • Grand Canyon1,3 • 44 ROVs2 • Q4000 • Siem Helix 21 • Grand Canyon II1 • 1 ROVDrill unit2 • Seawell
Slide 17: Key Financial Metrics
Key Financial Metrics 17
Slide 18: Debt Instrument Profile
DEBT INSTRUMENT PROFILE Total funded debt1 of $415 million at 9/30/20 • $35 million Convertible Senior Notes due 2022 – 4.25%2 Principal Payment Schedule at 9/30/20 ($ in millions) • $30 million Convertible Senior Notes due 2023 – 4.125%2 $250 • $200 million Convertible Senior Notes due 2026 – 6.75%
Slide 19: Debt & Liquidity Profile
DEBT & LIQUIDITY PROFILE $700 $626 $600 $496 $500 $440 $406 $400 $357 $269 $300 $229 $200 $161 $143 $98 $100 $0 12/31/16 12/31/17 12/31/18 12/31/19 9/30/20 Long-term Debt¹ Net Debt² Liquidity³ Liquidity3 of approximately $404 million at 9/30/20 1 Long-term debt is net of unamortized debt discounts a
Slide 20: 2020 Outlook
2020 Outlook 20
Slide 21: 2020 Outlook: Forecast
2020 OUTLOOK: FORECAST ($ in millions) 2020 2019 Outlook Actual Revenues $ 710 - 735 $ 752 Adjusted EBITDA1,2,3 135 - 145 180 Free Cash Flow1 50 - 85 31 4 Capital Additions ~ 38 161 Revenue Split: Well Intervention $ 525 - 540 $ 593 Robotics 165 - 175 172 Production Facilities3 60 61 Eliminations5 (
Slide 22: 2020 Outlook: Backlog and Well Intervention
2020 OUTLOOK Total backlog at September 30, 2020 was approximately $481 million ($271 million for Well Intervention); backlog of $130 million expected to be realized during remainder of 2020 Well Intervention Outlook • Q4000 (Gulf of Mexico) – contracted backlog into November; identified opportuniti
Slide 23: 2020 Outlook: Robotics
2020 OUTLOOK Robotics Outlook • Grand Canyon II (Asia Pacific) – completed work in Taiwan mid-October; subsequently contracted for expected 30-day ROV support work in Japan; expected good utilization during remainder of Q4 • Grand Canyon III (North Sea) – expected strong utilization during Q4 perfor
Slide 24: 2020 Outlook: Capital Additions & Balance Sheet
2020 OUTLOOK: CAPITAL ADDITIONS & BALANCE SHEET 2020 Capital additions are currently forecasted at approximately $38 million, consisting of the following: • Growth Capex – $5 million related primarily to completion of Q7000 and related intervention system • Maintenance Capex – $33 million primarily
Slide 25: Non-GAAP Reconciliations
Non-GAAP Reconciliations 25
Slide 26: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS Twevle Months ($ in thousands, unaudited) Three Months Ended Nine Months Ended Ended 9/30/20 9/30/19 6/30/20 9/30/20 9/30/19 12/31/19 Adjusted EBITDA: Net income $ 24,445 $ 31,622 $ 5,450 $ 15,967 $ 49,763 $ 57,697 Adjustments: Income tax provision (benefit) 5,232 3,539 (271
Slide 27: Thank you
Thank you @eo0000 € Helix ENERGY SOLUTIONS
Helix Energy Solutions Group — Q3 2020 Earnings Presentation on 6ix