Trico Marine Services — Proxy Contest (May 2009)
27 slides from Trico Marine Services's proxy contest presentation, May 21, 2009
Slide 1: A Call for Accountability at Trico Marine
A Call for Accountability at Trico Marine May 2009
Slide 2: THIS PRESENTATION IS FOR GENERAL INFORMATIONAL PURPOSES ONLY. IT DOES NOT HAVE REGARD TO
2 THIS PRESENTATION IS FOR GENERAL INFORMATIONAL PURPOSES ONLY. IT DOES NOT HAVE REGARD TO THE SPECIFIC INVESTMENT OBJECTIVE, FINANCIAL SITUATION, SUITABILITY, OR THE PARTICULAR NEED OF ANY PERSON WHO MAY REVIEW THIS PRESENTATION, AND SHOULD NOT BE TAKEN AS ADVICE ON THE MERITS OF ANY INVESTMENT DEC
Slide 3: Executive Summary: Deep Trouble at Trico Marine
3 We are seeking to add meaningful stockholder representation to the Board for the benefit of ALL Trico stockholders Executive Summary Deep Trouble at Trico Marine • Trico has over the past three years severely underperformed its peers by virtually every measure • Poor operating, financial and risk
Slide 4: Executive Summary: Kistefos Offers Experienced Nominees and a Fresh Perspective
4 Executive Summary Kistefos Offers Experienced Nominees and a Fresh Perspective • Kistefos’ two highly qualified nominees – have extensive entrepreneurial and management experience – have extensive turnaround experience – have vast knowledge of the shipping and off-shore businesses – bring local ex
Slide 5: Severe Underperformance at Trico Marine Services
5 Severe Underperformance at Trico Marine Services • Over the last 12 months, TRMA shares have lost more than 90% of their value • Over the same period, the share value of the GICS Energy Industry Group* has fallen only 32% • The TRMA share price collapse has destroyed more than $560 million of stoc
Slide 6: Severe Underperformance at Trico Marine Services
6 Severe Underperformance at Trico Marine Services (1) Notes 1. As of 19 May 2009. Rebased to TRMA 2. Includes Bristow Group Inc. (BRS), Hornbeck Offshore Services Inc. (HOS), GulfMark Offshore inc. (GLF), SEACOR Holdings Inc. (CKH), and Tidewater Inc. (TDW) 3. Includes Oceaneering International Inc
Slide 7: Severe Underperformance at Trico Marine Services
7 Severe Underperformance at Trico Marine Services Trico’s stock performance is in the bottom quartile of the industry for both the last 12 months and the last three years 71.0 255.8 (7.0) (44.8) (34.5) (57.8) (64.8) (71.9) (90.7) (89.0) (150) (100) (50) 0 50 100 150 200 250 300 Last 12 Months Last
Slide 8: Trico's Highly Leveraged Capital Structure
8 Trico’s Highly Leveraged Capital Structure Source: 1. Morgan Stanley, Factset 3.2 1.9 1.6 1.4 0.5 5.9 3.4 2.9 2.3 2.3 0.6 0.0 1.5 3.0 4.5 6.0 TRMA BRS HOS CKH GLF TDW HLX GLBL SPN DVR OII Total Debt / EBITDA 2009E x 351 224 110 61 25 20 61 116 202 365 401 0 100 200 300 400 500 CKH BRS TDW GLF TRMA
Slide 9: Trico's Recent Debt Exchange: Good for Creditors, Bad for Stockholders
9 Trico’s Recent Debt Exchange: Good for Creditors, Bad for Stockholders • Trico recently exchanged 6.5% convertible debentures for 8.125% convertible debentures, cash and common stock or warrants • Transaction was bad for stockholders and the company – Reduced term of debt by 15 years to 2013 from
Slide 10: Trico's Underperformance Far Exceeds Market Conditions
10 Trico’s Underperformance Far Exceeds Market Conditions • Failure to successfully manage newbuild program to maximize returns in the up cycle – In 2005, Trico contracted for one platform supply vessel (PSV) with an option for a second – First PSV never delivered to Trico due to lack of constructio
Slide 11: Trico's Deficient Corporate Governance Policies
11 Trico’s Deficient Corporate Governance Policies • Stockholders' ability to request special meetings is illusory – Conditions placed on stockholders’ ability to request meetings are effectively insurmountable – Stockholders wishing to request a special meeting risk triggering events of default und
Slide 12: Trico Has Adopted Stockholder-Unfriendly Policies
12 More stockholder-friendly governance and disclosure policies would help Trico rebuild lost stockholder confidence and value Trico Has Adopted Stockholder-Unfriendly Policies • Since emerging from Chapter 11 reorganization in 2005, Trico policies have been hostile to stockholder interests • Repeat
Slide 13: Trico's Directors Have Shown No Commitment to Trico's Stock
13 How can stockholders place faith in a Board that does not believe in the company enough to put their money at risk? Trico’s Directors Have Shown No Commitment to Trico’s Stock • In aggregate, Trico directors have purchased fewer than 20,000 shares of Trico stock, or one-tenth of one percent of ou
Slide 14: The Board Needs a New Approach NOW
14 The Board Needs a New Approach NOW • Kistefos nominees will seek a broad review of strategic operational and financial alternatives to recover stockholder value – Current opaque disclosure practices make it difficult to effectively analyze the company from the outside • Kistefos would bring much
Slide 15: Kistefos' Proposals Would Enhance Trico's Corporate Governance
15 Kistefos’ Proposals Would Enhance Trico’s Corporate Governance Kistefos proposes to: • Give stockholders reasonable right to request a special meeting (Proposal 6) – Special meetings would still be reserved for extraordinary circumstances – Adoption allows stockholders to exercise their rights wi
Slide 16: Kistefos' Nominees Bring Relevant Industry and Financial Experience
16 Kistefos’ Nominees Bring Relevant Industry and Financial Experience Christen Sveaas and Åge Korsvold have proven track records of owning, operating and advising successful corporations, as well as helping to create long-term stockholder value as Board members Åge Korsvold • Chief Executive Office
Slide 17: There Are No Legal Impediments To Kistefos' Proposals
17 There Are No Legal Impediments To Kistefos’ Proposals • Kistefos’ proposals do not violate competition or maritime laws – Trico’s claims of legal or regulatory obstacles are unfounded and distract stockholders from the real issues • There is no issue under the Jones Act – Our proposal to expand t
Slide 18: A Call for Accountability at Trico
18 We are seeking to add meaningful stockholder representation to the Board for the benefit of ALL Trico stockholders A Call for Accountability at Trico • Kistefos is gravely concerned about the destruction of stockholder value at Trico • Trico’s corporate governance policies are severely deficient
Slide 19: Appendix: Further Information on Kistefos AS
19 APPENDIX Further Information on Kistefos AS Christen Sveaas Åge Korsvold
Slide 20: Kistefos
20 Kistefos • Kistefos is a privately owned Norwegian investment company headquartered in Oslo • Kistefos’ investment policy focuses on three asset classes: – Principal Investments in Shipping & Offshore Services – Private Equity – Seed and Venture Capital • Kistefos’ investment portfolio consists o
Slide 21: Investment philosophy
21 Investment philosophy • Kistefos investment philosophy is built on long-term value creation through active ownership: – Kistefos seeks to establish and develop a basis for profitable growth in portfolio companies through capital, industrial and financial competence and professional governance – K
Slide 22: Christen Sveaas – Biography and Experience
22 Christen Sveaas – Biography and Experience Entrepreneurial: • Christen Sveaas, 52 years, Norwegian, comes from a family with a long tradition of investment and entrepreneurship in industry. His grandfather, consul Anders Sveaas founded AS Kistefos Tresliberi in 1889. • Received his MBA (lic.oec.)
Slide 23: Åge Korsvold – Biography and Experience
23 Åge Korsvold – Biography and Experience Advisory: • Investment banker with two Norwegian firms from 1983 to 1994. • Has advised on numerous reorganizations of companies in the Nordic region in various industries, including steel, retail and shipping. • Helped build Fondsfinans AS into a leading i
Slide 24: Case Study – Ementor ASA
24 Case Study – Ementor ASA* • Ementor [Atea] is the leading Nordic and Baltic supplier of IT infrastructure products and services. • Ementor was a listed company on the Oslo Stock Exchange with Kistefos as its largest shareholder. • Mr. Korsvold has been its Chairman from June 2003. • Ementor under
Slide 25: Case Study – Kistefos AS (2002-2007)
25 Case Study – Kistefos AS (2002-2007) • Since Åge Korsvold took over as Chief Executive Officer of Kistefos, Kistefos has reported solid net results and generated significant shareholder value resulting in significant distributions to shareholders 500 1 000 1 500 2 000 2 500 3 000 Book equity 2002
Slide 26: Relative Trading Multiples (as of May 19, 2009)
Relative Trading Multiples (as of May 19, 2009) 26 Median: 4.6x Median: 10.1x 6.6 6.5 4.6 4.4 3.3 5.0 5.1 5.2 5.2 5.8 6.4 0.0 2.0 4.0 6.0 8.0 GLF BRS TRMA CKH TDW HOS DVR OII HLX SPN GLBL EV / EBITDA 2010E x 14.1 11.0 10.1 8.6 8.3 3.8 6.5 8.0 8.2 8.6 9.5 0.0 4.0 8.0 12.0 16.0 BRS CKH TDW GLF HOS TRM
Slide 27: GICS Energy Industry Group
GICS Energy Industry Group ABP Abraxas Petroleum Corp. DBLE Double Eagle Petroleum Co. HOC Holly Corp. PVA Penn Virginia Corp. WLB Westmoreland Coal Co. ACI Arch Coal Inc. DHT DHT Maritime Inc. HOS Hornbeck Offshore Services Inc. PXD Pioneer Natural Resources Co. WLL Whiting Petroleum Corp. AEZ Amer