Helix Energy Solutions Group, Inc. · NYSE:HLX
Helix Energy Solutions — Q2 2022 Earnings Presentation
31 slides from Helix Energy Solutions's earnings presentation, Jul 26, 2022
Slide 1: Second Quarter 2022 Conference Call
July 26, 2022 Second Quarter 2022 Conference Call
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements that involve risks, uncertainties and assumptions that could cause our results to differ materially from those expressed or implied by such forward-looking statements. All statements, other than statements of historical
Slide 3: Presentation Outline
PRESENTATION OUTLINE • Executive Summary (pg. 4) • Operational Highlights by Segment (pg. 9) • Key Financial Metrics (pg. 16) • 2022 Outlook (pg. 19) • Non-GAAP Reconciliations (pg. 27) • Questions and Answers 3
Slide 4: Executive Summary
Executive Summary ENERGY SOLUTIONS,
Slide 5: Executive Summary
EXECUTIVE SUMMARY ($ in millions, except per share amounts, unaudited) Three Months Ended Six Months Ended 6/30/22 6/30/21 3/31/22 6/30/22 6/30/21 Revenues $ 163 $ 162 $ 150 $ 313 $ 325 Gross profit (loss) $ (1) $ 3 $ (19) $ (20) $ 18 (1)% 2% (12)% (6)% 5% Net loss1 $ (30) $ (14) $ (42) $ (72) $ (17
Slide 6: Executive Summary – Q2 2022 Highlights
EXECUTIVE SUMMARY – Q2 2022 HIGHLIGHTS Financial Results • Net loss1 of $30 million, $(0.20) per diluted share • Adjusted EBITDA2 of $17 million • Operating cash flows of $(6) million • Free Cash Flow2 of $(7) million Operations • Resurgence of activity in the North Sea with solid utilization on the
Slide 7: Executive Summary – Q2 2022 Segments
EXECUTIVE SUMMARY – Q2 2022 SEGMENTS Well Intervention • Well Intervention vessel fleet utilization 67% • 80% in the GOM • 44% in the North Sea and West Africa • 88% in Brazil1 • 15K IRS utilization 95%; 10K IRS idle during quarter Robotics • Robotics chartered vessels utilization 94% • 370 total ve
Slide 8: Executive Summary – Balance Sheet
EXECUTIVE SUMMARY – BALANCE SHEET Q2 20221 • Cash and cash equivalents of $261 million (excludes $3 million of restricted cash) • Liquidity2 of $321 million • Long-term debt3 of $267 million (remaining $35 million principal of Convertible Senior Notes due 2022 repaid during Q2) • Net debt4 of $4 mil
Slide 9: Operational Highlights By Segment
Operational Highlights By Segment 9
Slide 10: Business Segment Results
BUSINESS SEGMENT RESULTS ($ in millions, unaudited) Three Months Ended Six Months Ended 6/30/22 6/30/21 3/31/22 6/30/22 6/30/21 Revenues Well Intervention $ 106 $ 132 $ 106 $ 213 $ 266 Robotics 50 32 37 87 54 Production Facilities 18 14 18 36 31 Intercompany eliminations (11) (16) (12) (23) (25) Tot
Slide 11: Well Intervention – Gulf of Mexico
WELL INTERVENTION – GULF OF MEXICO • Q5000 – 95% utilized in Q2; performed production enhancement scopes on six wells for three customers • Q4000 – 66% utilized in Q2; completed a multi-well campaign with multiple scopes for one customer followed by regulatory maintenance during quarter; commenced a
Slide 12: Well Intervention – North Sea and West Africa
WELL INTERVENTION – NORTH SEA AND WEST AFRICA • Q7000 – 2% utilized in Q2; completed successful campaign in Nigeria and subsequently conducted scheduled regulatory flag and class recertification maintenance in Namibia during quarter • Well Enhancer – 63% utilized in Q2; performed enhancement scope o
Slide 13: Well Intervention – Brazil
WELL INTERVENTION – BRAZIL • Siem Helix 1 – 77% utilized in Q2; completed short-term FPSO support and accommodations work offshore Ghana and subsequently commenced ROV work scopes for Trident Energy in Brazil in preparation for decommissioning campaign • Siem Helix 2 – 99% utilized in Q2 for Petrobr
Slide 14: Robotics
ROBOTICS • Grand Canyon II (Asia Pacific) – 100% utilized in Q2; completed decommissioning work offshore Thailand followed by ROV support for windfarm offshore Taiwan • Grand Canyon III (North Sea) – 89% utilized in Q2; performed renewables trenching operations for two customers • Shelia Bordelon (G
Slide 15: Utilization
UTILIZATION 100% 94% 90% 93% 80% 72% 60% 67% 67% Q2 2022 53% Q1 2022 40% Q2 2021 35% 36% 20% 0% Well Intervention Vessels Robotics Support Vessels ROVs and Trenchers • Q5000 • Siem Helix 11 • Grand Canyon II1 • 40 ROVs2 • Q4000 • Siem Helix 21 • Grand Canyon III1 • 1 ROVDrill unit • Seawell • Q7000
Slide 16: Key Financial Metrics
Key Financial Metrics 16
Slide 17: Debt Instrument Profile
DEBT INSTRUMENT PROFILE Principal Payment Schedule at 6/30/22 Total funded debt1 of $275 million at 6/30/22 ($ in millions) • $30 million Convertible Senior Notes due 2023 – 4.125% $250 • $200 million Convertible Senior Notes due 2026 – 6.75% $210 • $45 million MARAD Debt – 4.93% $200 • Semi-annual
Slide 18: Debt & Liquidity Profile
DEBT & LIQUIDITY PROFILE ($ in millions) $500 $426 $380 $452 $400 $348 $305 $321 $300 $200 $279 $291 $254 $267 $261 $100 $208 $22 $0 $(4) ($100) $(161) $(143) $(58) $(229) $(267) ($200) $(305) $(350) ($300) $(406) $(496) $(440) ($400) ($500) 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 6/30/22 Cash¹
Slide 19: 2022 Outlook
2022 Outlook 19
Slide 20: 2022 Outlook: Forecast
2022 OUTLOOK: FORECAST ($ in millions) 2022 2021 3 Helix Outlook Helix Alliance4 Combined Actual Revenues $ 650 - 725 $ 75 - 100 $ 725 - 825 $ 675 Adjusted EBITDA1 70 - 85 15 - 25 85 - 110 96 Free Cash Flow1 (30) - (5) 10 - 20 (20) - 15 132 Capital Additions2 47 - 55 3-5 50 - 60 17 Revenue Split: We
Slide 21: 2022 Outlook – Well Intervention
2022 OUTLOOK – WELL INTERVENTION • Q4000 (Gulf of Mexico) – contracted work into Q4 with expected strong utilization during remainder of the year • Q5000 (Gulf of Mexico) – contracted work into late Q4 with expected strong utilization during remainder of the year • IRS rental units (Gulf of Mexico)
Slide 22: 2022 Outlook – Robotics
2022 OUTLOOK – ROBOTICS • Grand Canyon II (Asia Pacific) – performed ROV support work on windfarm project offshore Taiwan expected through Q3 and expected to have high utilization during remainder of 2022 before charter expiration date at end of the year • Grand Canyon III (North Sea) – performing s
Slide 23: 2022 Outlook – Helix Alliance
2022 OUTLOOK – HELIX ALLIANCE • Offshore – marine services with diversified fleet consisting of six offshore supply vessels (OSVs), 10 liftboats (ranging in size up to 265 ft) and one crewboat • 2022 Outlook – expect stable utilization on seven to nine liftboats and variable seasonal utilization on
Slide 24: 2022 Outlook: Capital Additions & Balance Sheet
2022 OUTLOOK: CAPITAL ADDITIONS & BALANCE SHEET 2022 Capital additions are forecasted at approximately $50 - $60 million: • Primarily maintenance capex related to regulatory recertification costs of our vessels and systems • Capital additions during Q2 approximated $11 million and included • Approxi
Slide 25: Beyond 2022
BEYOND 2022 • Continue momentum on the three legs of our Energy Transition business model: production maximization, decommissioning and renewables • Integration of Alliance and full-field abandonment capabilities • Expect to continue anticipated momentum from second half 2022 into 2023 • Operating c
Slide 26: Beyond 2022
BEYOND 2022 • Potential Improvements in 20231 We expect 2023 to be substantially better than 2022, based on the following: • Brazil – Both vessels expected to be working in intervention mode at profitable rates in 2023; expected EBITDA improvement $55 to $65 million in 2023 • Q7000 – Absence of regu
Slide 27: Non-GAAP Reconciliations
Non-GAAP Reconciliations 27
Slide 28: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS ($ in thousands, unaudited) Three Months Ended Six Months Ended Year Ended 6/30/22 6/30/21 3/31/22 6/30/22 6/30/21 12/31/21 Adjusted EBITDA: Net loss $ (29,699) $ (13,683) $ (42,031) $ (71,730) $ (16,733) $ (61,684) Adjustments: Income tax provision (benefit) 1,434 (1,968) 2
Slide 29: Non-GAAP and Other Definitions
NON-GAAP AND OTHER DEFINITIONS Non-GAAP Financial Measures We define EBITDA as earnings before income taxes, net interest expense, gains or losses on extinguishment of long- term debt, gains or losses on equity investments, net other income or expense, and depreciation and amortization expense. Non-
Slide 30: Environmental, Social and Governance
ENVIRONMENTAL, SOCIAL AND GOVERNANCE Environmental • Our business supports both the responsible transition from a carbon- based economy and extending the value and therefore the life cycle of underutilized wells, which in turn helps clients avoid drilling new wells. These efforts are published in gr
Slide 31: Thank you
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Helix Energy Solutions Group — Q2 2022 Earnings Presentation on 6ix