Slide 1: MODEC, Inc. 2019 Financial Results Analysts Presentation
MODEC, Inc. 2019 Financial Results Analysts Presentation February 6, 2020
Slide 2: Highlight / Financial Results / Market Review & Outlook
Highlight Financial Results Market Review & Outlook Financial Results 2
Slide 3: FY2019: Highlights
FY2019: Highlights • Awarded 3 FPSOs. Favorable market environment • Revenue increased to JPY 332.6 billion mainly due to progress of EPCI projects • First net loss since listed in 2003 - Recognition of loss provision for EPCI project in Mexico - Recognition of extraordinary loss for MV14 repair cos
Slide 4: FY2019: New Awards
FY2019 : New Awards Awarded 3 FPSOs FPSO Almirante Barroso MV32 Client Petrobras Contract EPCI＋Time Charter (21 years) Field Location Búzios Field(Brazil) Water Depth 1,900m Oil Production 150,000 bopd Gas Production 212 mmscfd Storage Capacity 1,400,000 bbls FPSO Barossa FPSO Anita Garibaldi MV33
Slide 5: FY2019: EPC(I) (as of end-December 2019)
FY2019: EPC(I) (as of end-December 2019) FPSO FPSO FPSO FPSO FPSO FPSO Carioca Guanabara MIAMTE Almirante Barroso Anita Garibaldi Barossa MV30 MV31 MV34 MV32 MV33 Client Petrobras Petrobras Eni Mexico Petrobras Petrobras ConocoPhillips Contract EPCI + Time EPCI + Time EPCI + Time EPCI + Time EPCI +
Slide 6: FY2019: EPCI project in Mexico
FY2019: EPCI project in Mexico • Status of the Project - Construction costs had increased mainly due to modification of conditions found after the bid and extension of construction period of a subcontractor in Mexico. Loss provision for the project was recorded. - It has been settled in 4th quarter.
Slide 7: EPC(I) / Charter / O&M Period
As of December 2019 EPC(I) period EPC(I) / Charter / O&M Period Time Charter fixed period Time Charter option period O&M period 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 1 FPSO Barossa ConocoPhillips 2 TBD FPSO Anita Garibaldi MV33 Petrobras 25y 3 35.0 FPSO Almira
Slide 8: FY2019: Operation and Maintenance in Brazil
FY2019: Operation and Maintenance in Brazil • Repair Cost for Cidade do Rio de Janeiro MV14 - Some cracks were identified on the hull of FPSO during the demobilization. - Under repair in a shipyard in Brazil to repair the cracks and remove residues and coals in order to tow out the FPSO to a scrap y
Slide 9: FY2019: Progress of Mid-term Business Plan 2020
FY2019: Progress of Mid-term Business Plan 2020 Evolution of Asset Integrity Digitalization MODEC NOAH M350 Next Generation New Built FPSO Hulls Install advanced analytics- enabled predictive Respond to the requirement of bigger topside maintenance system in 9 FPSOs and longer duration Promo
Slide 10: Market Review & Outlook
Highlight Market Review & Outlook Financial Results 10
Slide 11: Market View
Market View Oil & Natural Gas Prices (WTI/Henry Hub) FPSO Awards (Historical + Forecast) USD/bbl USD/Million BTU Lease Turnkey 150 15 Number of Lease (forecast) Turnkey (forecast) FPSO Awards Speculative Petrobras serial FPSOs 100 10 15 50 5 0 0 2000 2005 2010 2015 Source: EIA 10 Demand by Energy Ty
Slide 12: Financial Results
Highlight Market Review & Outlook Financial Results 12
Slide 13: New Orders / Revenue
New Orders / Revenue MV32 New Orders Revenue EPC(I) period Sangomare Barossa Billion JPY Billion JPY MV33 MV33 800 800 MV32 MV34 MV34 700.9 MV31 MV30 635.8 FSO Ailsa MV29 Stampede MV27 MV25 MV26 2015 2016 2017 2018 2019 2020 400 400 332.6 295.5 253.6 229.9 221.9 188.7 191.1 92.7 0 0 2015 2016 2017 2
Slide 14: Order Backlogs
Order Backlogs Order backlogs for MODEC Group’s share in the “Lease, Charter and O&M services” of the affiliates accounted for by the equity method Billion JPY MV32 1,387.0 1,200 1,144.4 1,087.6 817.6 800 761.6 648.9 636.1 569.4 534.5 494.7 400 0 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 14
Slide 15: Operating Income
Operating Income A A : Consolidated Operating Profit A+B B : Operating Profit (equity method portion) A+B+C C : Influence of Deferred/Realized Profits Billion JPY Billion JPY 40.3 40 40 39.1 38.4 35.6 33.1 29.7 29.3 30 30 27.4 20 18.0 20 18.0 16.6 14.9 14.9 15.4 11.4 11.4 10 10 5.0 5.0 0 0 -4.8 -4.8
Slide 16: Other Income
Other Income Equity in Earnings of Affiliates Net Interest Income Million USD Billion JPY MV25 MV29 5.1 MV27 4.9 100 5 88.6 MV26 85.7 82.5 3.6 69.2 2.5 50 3 2.2 21.7 0 0 2015 2016 2017 2018 2019 16 2015 2016 2017 2018 2019
Slide 17: Influence of Deferred/Realized Profits / Ordinary Profits
Influence of Deferred/Realized Profits / Ordinary Profits Ordinary Profit (as if Influence of Deferred/Realized Profits consolidating affiliates basis Deferred Realized Balance A A : Consolidated Ordinary Profit A+B+C B : Ordinary Profit (equity method portion) 2015 2016 2017 2018 2019 C : Influence
Slide 18: Profit & Loss
Profit & Loss 2018 2019 Variance Million JPY Revenue 221,909 332,644 110,735 Revenue increased due to the progress of EPCI projects Gross Profit 26,557 7,495 (19,062) Gross profit decreased comparing to last Selling, General and Administrative Ecpenses 11,628 12,336 708 year mainly because the r
Slide 19: Balance Sheet
Balance Sheet 2018 2019 Variance Million JPY Cash and Deposits 51,215 52,381 1,166 Accounts receivable increased in line with EPC(I) Accounts Receivable - trade 95,065 163,364 68,299 progress Short-term Loans Receivable 43,021 8,387 -34,634 Short-term loans receivable decreased due to collection
Slide 20: Key Financial Indicators
Key Financial Indicators EBITDA Interest-Bearing Debt EBITDA（after adjustment*） Total interest-bearing debt（after EBITDA Instant Coverage Ratio adjustment*） Billion JPY X times Billion JPY X times 57.8 60 53.3 53.4 12.0 47.1 202.8 10.0 200 4.8 5.5 166.1 161.6 40 7.2 7.5 33.5 8.0 4.0 8.2 4.3 3.0 95.6
Slide 21: FY2020: Outlook
FY2020 : Outlook Revenue Operating Profit Ordinary Profit Profit Attributable to Owners of Parent Billion JPY Billion JPY Billion JPY Billion JPY 400.0 20 40 25 18.0 21.0 21.8 400 19.4 20 332.6 14.9 15 29.4 15 30 28.7 12.0 11.4 24.3 10 229.9 10 221.9 5 191.1 20 200 6.0 17.0 0 5 (5) 10 0 (10) (15) -4
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