Helix Energy Solutions Group, Inc. · NYSE:HLX
Helix Energy Solutions — Q4 2011 Earnings Presentation
30 slides from Helix Energy Solutions's earnings presentation, Feb 23, 2012
Slide 1: Fourth Quarter 2011 Conference Call
Fourth Quarter 2011 Conference Call February 23, 2012
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All such statements, other than statements of historical fact, are “forward-looking statements” wit
Slide 3: Presentation Outline
Presentation Outline • Executive Summary Summary of Q4 2011 Results (pg. 4) • Operational Highlights by Segment Contracting Services (pg. 9) Oil & Gas (pg. 15) • Key Balance Sheet Metrics (pg. 20) • 2012 Outlook (pg. 22) • Non-GAAP Reconciliations (pg. 27) • Questions & Answers Express installing su
Slide 4: Executive Summary
4 Executive Summary
Slide 5: Executive Summary
Executive Summary ($ in millions, except per share data) (A) Included a $16.7 million non-cash charge to write off goodwill associated with our Southeast Asia well operations subsidiary in fourth quarter 2010. (B) Included a $7.1 million deferred tax asset valuation allowance associated with our Sou
Slide 6: Executive Summary
Executive Summary • Q4 2011 EPS of $0.16 per diluted share o Impairment charges totaling $107.5 million ($69.9 million after-tax) primarily associated with a reduction in carrying values of certain U.S. oil and gas properties and increases in U.S. and U.K. asset retirement obligations o Tax benefit
Slide 7: Executive Summary
Executive Summary • Oil and Gas (continued) o Oil and gas production totaled 2.24 MMboe (13.4 Bcfe) in Q4 2011 versus 1.95 MMboe (11.7 Bcfe) in Q3 2011 (year-to-date production of 8.7 MMboe / 52.2 Bcfe) § Avg realized price for oil of $110.75 / bbl ($100.93 / bbl in Q3 2011), inclusive of hedges § A
Slide 8: Operational Highlights
Operational Highlights
Slide 9: Contracting Services
($ in millions, except percentages) (A) See non-GAAP reconciliation on slides 28-29. Amounts are prior to intercompany eliminations. (B) Before gross profit impact of $6.6 million asset impairment charges in Australia. Contracting Services • 98% utilization in Well Ops • 87% utilization in Subsea Co
Slide 10: Earnings in Equity Investments
($ in millions) Earnings in Equity Investments
Slide 11: Contracting Services - Well Ops
Contracting Services - Well Ops GOM • Q4000 worked for Shell and Anadarko on multiple projects throughout Q4 • 100% utilization achieved in Q4 • Current backlog extends into 2013 North Sea • Seawell and Well Enhancer posted a combined 96% utilization in Q4 • Strong outlook anticipated for both vesse
Slide 12: Contracting Services - Robotics
Contracting Services - Robotics • 93% chartered vessel utilization and 92% trencher utilization • ROV and trencher utilization up in the Gulf of Mexico and North Sea • Completed first ROVDrill project in the North Sea: successfully completed 29 sites consisting of bore holes and cone penetrometer te
Slide 13: Contracting Services - Subsea Construction
Contracting Services - Subsea Construction Contracting Services - Subsea Construction • Express and Intrepid were 100% utilized during Q4 (excluding the Caesar ) • Express worked on projects for Chevron, Apache and Newfield • Intrepid was deployed to California in October. Expected to arrive back in
Slide 14: Contracting Services Utilization
• Express • Caesar (1) • Island Pioneer (2) • Deep Cygnus (2) • Olympic Triton (2) • Normand Clipper, Stril Explorer (2) • Well Enhancer • Q4000 • 2 ROVDrill Units • 3 Trenchers (1) Completed upgrades and sea trials on October 13. Caesar deployed to Mexico on accommodations project in Bay of Campech
Slide 15: Oil & Gas
(A) Fourth quarter 2011 impairments primarily associated with the reduction in carrying values of certain oil and gas properties due to year-end revisions in reserves. Further, fourth quarter 2011 impacted by increased asset retirement obligations for U.S. and U.K. end of life properties. (B) Includ
Slide 16: Oil & Gas - Operating Costs
Oil & Gas (A) Included accretion expense. Q4 2011 DD&A rate positively affected by increased proved reserves at our Phoenix field as a result of better than expected production rates (net of adjustments in other fields). (B) Excluded exploration expense, hurricane-related repairs and abandonment cos
Slide 17: Oil & Gas - Total Proved and Probable Reserves
Oil Mbbls Gas MMcf Total Mboe Total estimated proved reserves at 12/31/2010 24,818 227,264 62,695 Revision of previous oil and gas estimates 3,475 (108,947) (14,683) Production (5,785) (17,458) (8,694) Sales of reserves in place (205) (4,109) (890) Extensions and discoveries 386 271 431 Total estima
Slide 18: Oil & Gas - Reserve Report Highlights
Proved Developed Proved Undeveloped Total Total Estimated Reserves (MMboe) 23 16 39 Shelf 13 9 22 Deepwater 10 7 17 Oil (MMbbls) 13 10 23 Gas (Bcf) 60 37 97 SEC Case PV-10 (A) (pre-tax, in millions) $ 964 $ 508 $ 1,472 PV-10 Forward Strip Price (A), (B) (pre-tax, in millions) $ 949 $ 503 $ 1,452 Oil
Slide 19: Summary of Jan 2012 - Dec 2013 Hedging Positions
Summary of Jan 2012 - Dec 2013 Hedging Positions * * As of February 22, 2012
Slide 20: Key Balance Sheet Metrics
Key Balance Sheet Metrics
Slide 21: Debt and Liquidity Profile
Debt and Liquidity Profile Liquidity of approximately $1.1 billion at 12/31/2011 (A) Includes impact of unamortized debt discount under our Convertible Senior Notes. (B) Liquidity, as we define it, is equal to cash and cash equivalents ($546 million), plus available capacity under our revolving cred
Slide 22: 2012 Outlook
2012 Outlook
Slide 23: 2012 Outlook
Broad Metrics 2012 Forecast 2011 Actual Oil and Gas Production 7.5 MMboe 8.7 MMboe EBITDAX ~$600 million $669 million CAPEX ~$445 million $229 million Commodity Price Deck 2012 Forecast 2011 Actual Hedged Oil $104.80 / Bbl $100.91 / Bbl Gas $4.56 / Mcf $6.04 / Mcf 2012 Outlook
Slide 24: 2012 Outlook
2012 Outlook • Contracting Services o Strong backlog for the Q4000, Well Enhancer and Seawell through 2012 § Q4000 building backlog into 2013 o Well Enhancer working in West Africa and transits back to the North Sea late first quarter o Intrepid deployed to California performing field development pr
Slide 25: 2012 Outlook
2012 Outlook • Oil and Gas o Forecasted 2012 overall production of 7.5 MMboe, including Wang (Phoenix field) and Danny 2 (Bushwood field) exploration wells § Assumes Wang production commences Q4 § Assumes Danny 2 production commences mid-year o Approximately 90% of 2012 revenues from oil and NGLs o
Slide 26: 2012 Outlook - Capex
2012 Outlook - Capex • Capital Expenditures o Contracting Services ($250 million) § Announced new build semi submersible intervention vessel (approximately $130 million of capex in 2012) § Regulatory dry docks for four vessels § Continued incremental investment in robotics business, with a focus on
Slide 27: Non-GAAP Reconciliations
Non-GAAP Reconciliations
Slide 28: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted EBITDAX ($ in millions) We calculate Adjusted EBITDAX as earnings before net interest expense, taxes, depreciation and amortization and exploration expense. These non-GAAP measures are useful to investors and other internal and external users of our financial statem
Slide 29: Non-GAAP Reconciliations
Revenue and Gross Profit As Reported ($ in millions) Non-GAAP Reconciliations
Slide 30: Slide 30
Helix Energy Solutions Group — Q4 2011 Earnings Presentation on 6ix