Seadrill Limited · NYSE:SDRL
Seadrill — Q2 2010 Earnings Presentation
20 slides from Seadrill's earnings presentation, Aug 31, 2010
Slide 1: Conference call 2Q 2010 results
Conference call 2Q 2010 results August 31, 2010
Slide 2: Contents
Contents Highlights 2Q 2010 2Q 2010 accounts Operational status and performance Fleet contract status Market outlook Dividend policy Strategy Summary 2
Slide 3: Highlights second quarter 2010
Highlights second quarter 2010 EBITDA of US$493 million compared to US$434 million in the preceding quarter Earnings per share of US$0.77 Regular cash dividend increased to US$0.61 per share Acquires 7 jack-up rig company Scorpion Offshore Takes delivery of two ultra-deepwater units and two jack-up
Slide 4: Acquisition of Scorpion
Acquisition of Scorpion Numbers in US$ million Effects in our income statement 2Q report Gain on bargain purrchase 56 Remeasurement of previous holding in Scorpion 111 Effects in the balance sheet as per June 30 The basis is fair value Broker value on the rigs - surplus value 107 Contract value 51 N
Slide 5: EBITDA contribution
Seadiill 600 —- 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 M T w 2Q10 Gain from sale of assets
Slide 6: Mobile Units Division
Seadnill Mobile Units Division Unaudited accounts in USD millions 2Q10 1Q10 Operating revenues 621 582 Reimbursables 13 8 Other revenues 6 10 Total revenues 640 600 Vessel and rig operating expenses 200 195 Reimbursable expenses 12 8 Depreciation and amortisation 89 85 General and adminstrative expe
Slide 7: Tender Rigs Division
Seadnill Tender Rigs Division Unaudited accounts in USD millions 2Q10 1Q10 Operating revenues 123 89 Reimbursables 2 3 Total revenues 125 92 Vessel and rig operating expenses 47 39 Reimbursable expenses 2 2 Depreciation and amortisation 15 12 General and adminstrative expenses 6 4 Total operating ex
Slide 8: Income statement 2Q10 vs 1Q10
Unaudited accounts in USD million 2Q10 1Q10 Net operating income 383 332 Financial items Interest income 9 19 Interest expenses -58 -48 Share in results from associated companies 5 18 Gain related to the acquisition of Scorpion 167 0 Other financial items -123 -75 Total financial items 0 -86 Income
Slide 9: Assets
ASSETS Unaudited accounts in USD million 30.06.10 31.03.10 Current assets Cash (incl restrictive) 893 449 Marketable securities 408 708 Accounts receivables 536 402 Other current assets 578 611 Total current assets 2415 2170 Non-current assets Investment in associated companies 212 317 Newbuildings
Slide 10: Liabilities and shareholders' equity
Seadnill LIABILITIES AND SHAREHOLDERS' EQUITY Unaudited accounts in USD million 30.06.10 31.03.10 Current liabilities Current portion of long-term debt 1356 825 Other current liabilities 1720 1158 Total current liabilities 3076 1 983 Non-current liabilities Long-term interest bearing debt 7 239 6 70
Slide 11: Worldwide operations
Worldwide operations Europe - 5 units Newbuilds - 4 units - 3 Semis - 1 Jack-up - 1 Drillship - 1 deepwater semi GoM - 1 unit - 1 HE jack-up - 1 Semi - 1 BE jack-up - 1 semi-tender Brazil/Trinidad - 7 units - 3 Semis - 1 Drillship - 3 Jack-ups Southeast Asia - 2 units - 2 Semis Africa - 6 units - 2
Slide 12: Average utilization rate deepwater newbuilds
Average utilization rate deepwater newbuilds Performance closer to expectations 12
Slide 13: Market outlook
Market outlook Oil prices continue to trade in the mid-$70s per barrel Long term market drivers intact as global oil Historical dayrates for ultra-deepwater rigs basins mature and decline rates increase/stay 700 high 600 500 Exploration for oil and gas reserves takes USDk/day 400 place in more chall
Slide 14: US$9.1 billion contract backlog - Floaters
US$9.1 billion contract backlog - Floaters Superb earnings visibility 14
Slide 15: US$1.9 billion contract backlog - Jack-ups
US$1.9 billion contract backlog - Jack-ups Sound market outlook for premium rigs 15
Slide 16: US$1.5 billion contract backlog - Tender rigs
US$1.5 billion contract backlog - Tender rigs Improved market condition 16
Slide 17: Dividend distribution and policy
Dividend distribution and policy Quarterly dividend increased from 60 cent to 61 cent per share Increase reflects sound financial position, strong order backlog and earnings visibility as well as improving market conditions Future dividend depends on: Debt leverage Contract coverage Capital expendit
Slide 18: Net interest bearing debt and dividend
Net interest bearing debt and dividend Rigs re-contracted at latest market dayrate UDW floaters – $440’ BE Jack-ups– $120’/130’ Semi-tenders – $150’ Tender barges – $90’ Debt refinanced at similar terms No conversion has been assumed for the US$1.5 bn. convertible bonds Dividend level sustainable …
Slide 19: Seadrill is uniquely positioned
Seadrill is uniquely positioned Brand new fleet of rigs Sound operations Global presence Strong contract backlog and earnings visibility Unique bank relationships Confidence and trust from the equity markets Track record of accretive investments and M&A transactions Thinking shareholder value 24/7 1
Slide 20: Strong platform for growth
Strong platform for growth 20