Slide 1: MODEC, Inc. 2023 Half-Year Financial Results Analysts Presentation
MODEC, Inc. 2023 Half-Year Financial Results Analysts Presentation August 14, 2023 1
Slide 2: Agenda and note on IFRS reporting
1. Highlight 2. Initiatives for sustainable growth 3. Financial Results (Note) From the end of FY2021, the Company's consolidated financial results have applied International Financial Reporting Standards (IFRS) instead of the conventional Japanese GAAP. In addition, the currency unit has been chang
Slide 3: FY2023 Half-Year: New Order (1)
1. Highlight FY2023 Half-Year：New Order (1) Uaru FSPO ➢ Our first project in Guyana ➢ Our first order from ExxonMobil since 2003 Client ExxonMobil Contract EPCI+O&M(10years) Field Stabroek Water Depth 1,690m Oil Production 250,000 bopd Gas Production 540 mmscfd Storage 2,000,000 bbls 3
Slide 4: FY2023 Half-Year: New Order (2)
1. Highlight FY2023 Half-Year：New Order (2) BM-C-33 FPSO ➢ Our second FPSO with combined cycle power generation system ➢ 10th FPSO in the pre-salt region Client Equinor Contract EPCI+O&M(1year) Field BM-C-33 Water Depth 2,900m Oil Production 125,000 bopd Gas Production 565 mmscfd Storage 2,000,000 b
Slide 5: FY2023 Half-Year: Order received
1. Highlight FY2023 Half-Year：Order received ➢ USD 7,853 million in the first half of the year ➢ Annual Orders are expected to reach a record high EPC(I) US$M Lease, Charter and O&M 8,000 7,853 5,804 6,399 2,928 4,000 3,148 2,902 1,444 2,079 1,462 2,875 855 1,704 1,453 823 606 0 2019 2020 2021 2022
Slide 6: FY2023 Half-Year: EPC(I) (as of June 2023)
1. Highlight FY2023 Half-Year：EPC(I) (as of June 2023) FPSO FPSO FPSO FPSO FPSO Anita Garibaldi Sangomar Bacalhau Uaru BM-C-33 MV33 Client Petrobras Woodside Equinor ExxonMobil Equinor Contract EPCI + Time Charter Purchase Contract EPCI + Short term EPCI + O&M (10 yrs) EPCI + Short term ( 25 yrs) +
Slide 7: FY2023 Half-Year: Charter
1. Highlight FY2023 Half-Year：Charter FPSO Almirante Barroso MV32 Charter commenced in May 2023 Client Petróleo Brasileiro S.A. (Petrobras) Contract EPCI + Time Charter (21 yrs) Field Búzios Water Depth 1,900m Oil Production 150,000 bopd Gas Production 212 mmscfd Storage 1,400,000 bbls 7
Slide 8: EPC(I) / Charter / O&M Period
As of July 2023 1. Highlight ◼ EPC(I) period ◼ Time Charter fixed period EPC(I) / Charter / O&M Period ◼ Time Charter option period ◼ O&M period 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 (*) 1 FPSO BM-C-33 Equinor 1y 2 FPSO Uaru ExxonMobil 10y 3 FPSO Bacalhau Equinor 1y 4
Slide 9: Order Backlog (Charter)
1. Highlight Order Backlog (Charter) Secure long-term stable earnings with a large backlog of orders US$M 8,000 7,464 7,318 7,289 6,013 5,958 4,000 0 2019 2020 2021 2022 2023 1H 9
Slide 10: Floating Production Systems Planned or Under Study
1. Highlight Floating Production Systems Planned or Under Study Projects in Planning Pipeline (Appraisal, Planning, and Bidding/Final Design) as of July 2023 World Total Bidding & Final Design 55 Planning 85 Appraisal 41 China Canada 0 3 2 0 Northern Europe 4 1 1 6 Southeast Asia GOM 2 13 5 19 5 Med
Slide 11: FY2023: Outlook
1. Highlight FY2023 : Outlook ➢ Full-year revenue is expected to be US$3,000M due to progress of new EPCI projects (Exxon Uaru and BM-C-33) in addition to existing projects (Woodside Sangomar and Equinor Bacalhau). ➢ Although additional repair costs are forecasted, we expect to achieve the full-year
Slide 12: Third-party allotment capital increase
1. Highlight Third-party allotment capital increase 【Overview】 ➢ Number of new shares issued : Common stock 11,937,300 shares ➢ Amount of funds raised : JPY 15,088,747,200 ➢ Use of funds : Investment and loan to SPCs ➢ Underwriter : Mitsui O.S.K. Lines, Ltd. (10,162,300 shares) MITSUI & CO., LTD. (1
Slide 13: Shareholder return
1. Highlight Shareholder return 【Annual dividend per share (JPY)】 Capital reduction Special dividend/commemorative dividend Ordinary dividend 45 45 37.5 35 10 10 32.5 30 27.5 25 42.5 20 22.5 40 17.5 15 15 12.5 10 7.5 7.5 ➢ Increased dividends until 2019 since being listed on the 1st Section of the T
Slide 14: 2. Initiatives for sustainable growth
1. Highlight 2. Initiatives for sustainable growth 3. Financial Results 14
Slide 15: Overview of initiatives
2. Initiatives for sustainable growth Overview of initiatives Sustainable Development Goals (SDGs) ▪ While Modec recognizes that its business activities may directly or indirectly impact all 17 SDGs adopted by UN Member states in 2015, the Company will focus on Goals 5, 7, 8, 13 ▪ Modec has signed t
Slide 16: MODEC in future
2. Initiatives for sustainable growth MODEC in future Image of revenue composition ratio Other FPSO with lower carbon 2050 Current <Image> FPSO Digital solution Floating offshore wind 16
Slide 17: Efforts to reduce the carbon footprint of FPSOs
2. Initiatives for sustainable growth Efforts to reduce the carbon footprint of FPSOs ⚫ Oil and gas are expected to continue to be one of the world's major energy sources over the medium to long term. ⚫ Accelerating efforts to reduce the carbon footprint of FPSOs Current efforts ⚫ GHG emissions from
Slide 18: Floating offshore wind (1)
2. Initiatives for sustainable growth Floating offshore wind (1) 18
Slide 19: Floating offshore wind (2)
2. Initiatives for sustainable growth Floating offshore wind (2) 19
Slide 20: Digital solution
2. Initiatives for sustainable growth Digital solution 20
Slide 21: 3. Financial Results
1. Highlight 2. Initiatives for sustainable growth 3. Financial Results
Slide 22: Revenue
3. Financial Results Revenue EPC(I) Lease, Charter and O&M US$M ⚫ The progress of construction 4,000 3,899 work of Woodside Sangomar, Equinor Bacalhau, and Uaru 3,036 3,000 2,736 2,739 contributed to revenue. 3,115 2,000 2,168 1,949 1,775 1,588 1,000 1,096 868 786 783 964 492 0 2019 2020 2021 2022 2
Slide 23: Operating Profit / Profit Attributable to Owners of Parent
3. Financial Results Operating Profit / Profit Attributable to Owners of Parent Operating Profit US$49M / Profit Attributable to Owners of Parent US$23M / EBIDA US$173M(refer to P26) Operating Profit Profit Attributable to Owners of Parent US$M US$M MV32 300 100 200 50 37 23 100 75 0 49 0 (50) (44)
Slide 24: Equity in Earnings of Affiliates / Interest Income
3. Financial Results Equity in Earnings of Affiliates / Interest Income Steady growth in charter-related income (equity in earnings of affiliates and interest income) Equity in Earnings of Affiliates Interest Income (Charter related) US$M US$M 40 39 150 36 37 126 34 100 20 18 56 50 41 30 20 0 0 2019
Slide 25: Order Backlogs
3. Financial Results Order Backlogs ⚫ Order backlog for construction work increased significantly due to two new orders received. ⚫ Charter/O&M order backlog remains at a high level with long-term contracts. Order backlogs for MODEC Group’s share in the “Lease, US$M EPC(I) Charter and O&M services”
Slide 26: Adjusted EBITDA
3. Financial Results Adjusted EBITDA GAPP Adj. GAAP(*) EPCI + O&M Operations $ 64MM $ 64MM Charter Operations $ 86MM $ 99MM Service Fee (PL / CF) $ 22MM $ 21MM Interest received (PL / CF) $ 23MM $ 22MM Equity method investment income (PL) $ 42MM $ 56MM ⚫ Dividends received (Adj. GAAP): Dividends rec
Slide 27: Financial position and cash flow
3. Financial Results Financial position and cash flow Financial Position Unit：US$M 2022.12 2023.6 Variance Cash and cash equivalents 492 557 65 Trade & Other receivable 478 504 26 Contract assets 257 261 4 Investment accounted for using equity method 1,114 1,113 -1 LT loan receivable 365 355 -10 Tot
Slide 28: Thank you
Thank you