Borr Drilling Limited · NYSE:BORR
Borr Drilling — Investor Presentation (March 2018)
17 slides from Borr Drilling's investor presentation, Mar 22, 2018
Slide 1: Borr Drilling – Every crisis creates opportunities
Borr Drilling – Every crisis creates opportunities - from 0 to 49 rigs in 15 months Private placement of USD 250million 22 March 2018 |
Slide 2: Important information and disclaimer
Important information and disclaimer This presentation has been prepared by representatives of Borr Drilling Limited (the “Company”) and is general background information about the Company's activities current as at the date of this presentation. Information in this presentation, including forecast
Slide 3: Contemplated equity offering to finance the acquisition of Paragon Offshore
Contemplated equity offering to finance the acquisition of Paragon Offshore Transaction overview Sources and uses of funds Borr Drilling intends to raise up to USD 250m through issuing 54m new common shares at USD 4.60 per share USDm Sources The proceeds from the contemplated equity offering wil
Slide 4: Significant upside potential from investing at cycle trough
Significant upside potential from investing at cycle trough Share price performance for drillers from cycle trough to next peak 1 Cycle trough Next peak +1,541% 1,750 Index points (Rebased @ cycle trough) 1,500 1,250 1,000 +702% +595% 750 500 250 0 1980s 1990s 2000s Peer performance: 1980s Peer perf
Slide 5: 50% of the fleet is more than 30 years
50% of the fleet is more than 30 years Rigs over 30 years will be scrapped – Rigs over 15 years excluded from tenders 70 Obsolete Question mark 60 50 9 Paragon Offshore rigs have been sold for scrap 40 30 20 10 - 1974 1981 2007 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1975 1976 1977 19
Slide 6: We have spent the last 15 months building the leading jack-up drilling company
We have spent the last 15 months building the leading jack-up drilling company 1 Hercules Offshore 2 Transocean 3 PPL Shipyard 4 Paragon Offshore1 World-leading fleet Standard Standard NCW NCW Standard Semi Standard Standard NCW NCW NCW NCW Standard Standard Standard Standard Standard NC NC NC NC NC
Slide 7: Best assets acquired at rock-bottom prices
Best assets acquired at rock-bottom prices Premium jack-up fleets1 Best assets in the industry Delivered 2011 or later Delivered pre 2011 Newbuild order cost by order date: Other rigs Prospector 1 & 5 Borr 300 4 Drilling 22 2 24 +2 Borr 3 Drilling 20 2 22 250 Avg. order price for Rowan 4 12 16 Prosp
Slide 8: Don't fix rigs too early
Don’t fix rigs too early Activity is recovering Anecdotes from the last cycle # of JU tenders GSF Constellation I (now Atla, 400 ft from 2003): 60 55 Tenders up 50% 3-year contract with BP in April, signed early 2004 @ USD 75k 50 In 12-15 months, rates more than doubled 45 Rig extended for 2 y
Slide 9: Limited premium jack-up capacity left
Limited premium jack-up capacity left Increase in jack-up rig count in past cycles #of rigs 140 +124 in 44 months 120 +100 in 33 months 100 +88 in 24 months 80 60 40 20 0 1987-89 1999-01 2011-14 Currently only 37 premium jack-ups available from international operators, of which Borr Drilling control
Slide 10: Jack-ups are good business
Jack-ups are good business Key assumptions - 24 premium jack-ups in operation EV / EBITDA3 & FCFE yield Current Avg. cash Avg. Avg. market day break-even historical historical Last 10 year EV/EBITDA (x) FCFE yield (Pct.) Dayrate scenario rate for peers 10yrs 5yrs peak 21 80% 20.5 8.5 Historical day
Slide 11: Paragon Offshore – strong operational track record
Paragon Offshore – strong operational track record 2 x high spec & harsh environment jack-ups Attractive current and previous customer base Prospector 1 Prospector 5 + 30 x non-core rigs (29 standard jack-ups, 1 semi-sub) Approved bidder for Saudi Aramco1 and strong North-sea presence Borr Drilling
Slide 12: Paragon Offshore – attractive price
Paragon Offshore – attractive price Paragon Offshore transaction USDm 360 (35.0) 65.0 300 (72.5) 240 180 275.0 120 232.5 60 0 Value of PROS1/2 & MSS1 EBITDA backlog Net debt Available close down cost Purchase price Source: Borr Drilling 12 |
Slide 13: Experienced and aligned board
Experienced and aligned board Tor Olav Troim Patrick Schorn - SLB Fredrik Halvorsen Jan Rask Chairman of Borr Drilling EVP New Ventures Ubon Partners Former CEO Arethusa Former CEO Seadrill Schlumberger Former CEO Seadrill Former CEO Marine Drilling Former CEO Northern Offshore / COO Schlumberger Fo
Slide 14: The Borr lifecycle
The Borr lifecycle Getting started Phase I – Value preservation Phase II – Cash-flow Acquired a fleet of 58 rigs Market rigs for profitable employment Actively participated in M&A Add leverage against contract backlog Fire fighting Capitulation Established an operating platform Distribute excess cas
Slide 15: Why invest in Borr Drilling
Why invest in Borr Drilling Attractive entry point… …into a cyclical industry1 300 Newbuild order cost by order date: Other rigs Prospector 1 & 5 Cycle trough Next peak +1,541% 250 1,750 (Rebased @ cycle trough) 200 1,500 USDm 1,250 Index points 150 +702% 1,000 +595% 100 750 Borr Drilling fleet acqu
Slide 16: Borr Drilling fleet status report
Borr Drilling fleet status report Fleet status report Premium jack-ups 2018 2019 2020 Name Country Oil Company Delivered Design Water depth Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Atla UAE 2003 F&G JU-2000 400 Available - Warm stacked Balder Cameroon 2004 F&G JU-2000 400 Available - Warm stacked Idun Si
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