Fjord Defence Group Asa · OSL:DFENS
Fjord Defence Group Asa — Axxis Geo Solutions — Q4 2019 Earnings Presentation
21 slides from Fjord Defence Group Asa's earnings presentation, Feb 26, 2020
Slide 1: Fourth quarter 2019
Fourth quarter 2019 Axxis Geo Solutions Lee Parker, CEO and Svein Knudsen, CFO 26 February 2020
Slide 2: Disclaimer
Disclaimer • The information in this presentation has been prepared by Axxis Geo Solutions ASA (“AGS” or the “Company”). By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations and provisions: • This presenta
Slide 3: Agenda
Agenda 1. About AGS 2. Highlights 3. Financials 4. Operations and outlook 3
Slide 4: Axxis Geo Solutions in brief
Axxis Geo Solutions in brief Axxis Geo Solutions’ competitive edge in the OBS market • An ocean bottom node (OBN) seismic service company • Multi-client and contract seismic • Experienced management and organizational core • Headquarter at Lysaker, Norway • Listed on Oslo Axess (ticker AGS) Asset li
Slide 5: Flexible and cost efficient asset light leasing model
Flexible and cost efficient asset light leasing model Vessels Nodes Crews ▪ Flexibility on vessel type and ▪ Lease nodes based upon demand ▪ Possible to adjust number of crews capacity ▪ Multiple node suppliers can be used ▪ Flexibility proven in the North Sea ▪ Adjust fleet capacity to survey backl
Slide 6: Strong market forces driving OBS market growth
Strong market forces driving OBS market growth USDm • Rapidly growing USD >1 billion OBS 2 500 market 2 000 • Shallow and midwater – 60-70% of the OBS market O&G companies demands 1 500 high resolution data • Demand for high resolution data 1 000 • OBS cost coming down driving demand increase 500 •
Slide 7: Agenda
Agenda 1. About AGS 2. Highlights 3. Financials 4. Operations and outlook 7
Slide 8: Q4 Highlights
Q4 Highlights Contract signature delay • Completed Utsira Multi-client survey with TGS • Upgraded and tested Nodal handling systems • Mobilized Neptune Naiad to Brazil to start source operations for the Company’s Brazil campaign • Mobilized to Malta awaiting contract start in Egypt, Gulf of Suez • F
Slide 9: Agenda
Agenda 1. About AGS 2. Highlights 3. Financials 4. Operations and outlook 9
Slide 10: AGS reporting going forward
AGS reporting going forward Segment reporting (internal reporting) IFRS reporting • Gives a conventional representation of underlying • Due to IFRS15 revenue recognition, revenues operational performance and value creation related to multi-client projects are postponed until projects are ready to be
Slide 11: Fourth quarter segment financial review
Fourth quarter segment financial review Fourth quarter Segment P&L In NOK million • Revenues mainly driven by the Brazilian contract of NOK 35 million and pre-funding from multi-client program at Utsira of NOK 12 million • Cost of sales related to Brazil contract work and waiting in Malta for the Eg
Slide 12: Financials segment overview
Financials segment overview In NOK million In NOK million Revenue EBITDA and EBIT Sequential performance 350 327 200 144 134 • Segment revenue derives from 300 both contract and multi-client 100 69 251 activity 250 0 -9 -25 -1 • Extra ordinary write down of 200 -100 -52 goodwill and multi-client lib
Slide 13: Financing and segment financial position
Financing and segment financial position • Investments in multi-client library in fourth quarter of NOK 107 million, write down of NOK 308 million In NOK million • Investment in node handling system of NOK 13 million Assets position - Segment reporting • Other non-current assets – zero as of Decembe
Slide 14: Financing and segment financial position cont.
Financing and segment financial position cont. • Equity net of NOK 31 million In NOK million • Non-current liabilities zero as of December Equity and liabilities - Segment reporting • Interest bearing debt reclassed to short-term debt 800 • Total liabilities of NOK 654 million: 700 • Account payable
Slide 15: Project delay mitigation measures
Project delay mitigation measures Difference between expected and actual change in working capital • Secure the contract and associated positive 15 cash flow • Agreed payment plans with fuel suppliers 10 amounting to USD 4 million 5 • Payment plans of approx. USD 25 million with USD million 0 all la
Slide 16: Agenda
Agenda 1. About AGS 2. Highlights 3. Financials 4. Operations and outlook 16
Slide 17: Mobilized to Egypt, Gulf of Suez Q4-Q1 project
Mobilized to Egypt, Gulf of Suez Q4-Q1 project • Contract letter of award 30 December • The survey commenced early January after testing completed • Requires modern OBN imaging and processing techniques to unlock further hydrocarbon potential • The area is well known to AGS management and is expecte
Slide 18: Step-change in productivity
Step-change in productivity Km2 of acquired data per day Utsira 3D OBN productivity • Record productivity in source and receiver operations 14-20km2 • Safe operations with technical down time on nodal operations of only 1.2% • Possible to move Supporting customers as a one-stop-shop 2 up to 24km of
Slide 19: Backlog and outlook
Backlog and outlook 2019 2020 2021 Q4 Q1 Q2 Q3 Q4 Q1 North Committed Brazil Sea Source Vessel / PRM / VSP North Committed Egypt Sea OBN Projects Tenders Egypt North Sea Egypt North Sea GOM India Pipeline West Africa Middle East / Asia ~ USD 38 million backlog as of Q4 19 and ~USD 900 million tenders
Slide 20: Q&A
Q&A Lee Parker, CEO and Svein Knudsen, CFO 20
Slide 21: US Office / Norway Office
US Office Norway Office 14511 Old Katy Road Strandveien 50 Suite 150 1366 Lysaker Houston, TX 77079 Norway United States +47 480 95 555 +1 281 810 2550 21