Slide 1: SBM Offshore FY 2019 Earnings
OFFSHORE © SBM Offshore 2020. All rights reserved. www.sbmoffshore.com
Slide 2: Disclaimer
Disclaimer The companies in which SBM Offshore N.V. directly and indirectly owns investments are separate legal entities. In this presentation “SBM Offshore” and “SBM” are sometimes used for convenience where references are made to SBM Offshore N.V. and its subsidiaries in general. These expressions
Slide 3: Highlights
Highlights Doubling Fast4Ward® Ambition dividend momentum 2030 3
Slide 4: HSSE & ESG
~ HSSE & ESG The Market . Our Strategy Gs FY 2019 Financials ~ 4 aoe Outlook Ld OFFSHORE © SBM Offshore 2020. Alll rights reser
Slide 5: HSSE / License to operate
HSSE / License to operate Safety Target Excellence Total Recordable Injury Frequency Rate1 NO HARM, NO 1.20 Oil Majors Benchmark 2 DEFECTS, NO LEAKS SBM Offshore 1.00 0.80 0.60 0.40 0.20 0.00 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (1) Per 200k man-hours (2) Includes Shell, BP, T
Slide 6: Translating SDGs into targets and action
Translating SDGs into targets and action Plastic waste Gas flaring Supply chain Reduction of Reduction in gas Qualified vendors offshore plastic flared under SBM sign Supply Chain waste Offshore account Charter Recycling Recycling program in SBM Offshore Green energy Safety offices Energy in SBM Tot
Slide 7: Sustainable initiatives
Sustainable initiatives Emissions Wave Energy Human Plastic waste flaring Converter pilot rights reduction committed 2017 5.2 2018 3.9 22% reduction of plastic waste in 2019 2019 3.9 Emissions flaring in tonnes per ‘000 tonnes HC produced on SBM account Relative position: ‘Outperformer’ #1 amongst p
Slide 8: Raising the ambition in 2020
Raising the ambition in 2020 2019 2020 Post-2020 SDG Target setting SDG Target setting SDG Target setting 8
Slide 9: The Market
OFFSHORE
Slide 10: FPSO market - potential awards 2020-2022
FPSO market - potential awards 2020-2022 SBM Offshore capacity 2+ FPSO projects per year Potential awards FPSO within target market Other potential FPSO awards SBM FPSO awards 2019 Other FPSO awards 2019 Source: SBM Offshore market intelligence 10
Slide 11: Potential award areas 2020-2022
Potential award areas 2020-2022 Potential FPSO award(s) Potential turret award(s) 2 3 1 1 3 6 5 15 2 5 1 Source: SBM Offshore market intelligence 11
Slide 12: Total FPSO market awards
Total FPSO market awards SBM Offshore capacity 2+ FPSO projects per year FPSO awards SBM Offshore FPSO awards Potential FPSO awards (Base case) Potential FPSO awards (High case) Source: SBM Offshore market intelligence 12
Slide 13: Our Strategy
oe oe. The Market 7 fee Financials Z Quitlook ~ OFFSHORE © SBM Offshore 2020. All rights reserved. www.sbmoffshore.com 13
Slide 14: Vision to strategy
Vision to strategy OPTIMIZE TRANSFORM INNOVATE “SBM Offshore believes the oceans will provide the world with safe, sustainable and affordable energy for generations to come. We share our experience to make it happen.” 14
Slide 15: Optimize: Disciplined
Optimize Disciplined Delivering value to our stakeholders Win Execute Operate Selecting the right projects Delivering on time & on budget Delivering backlog, generating cash 15
Slide 16: Optimize | Delivering value to shareholders
Optimize | Delivering value to shareholders US$ millions c. US$900 million return over period 315 271 211 165 196 166 150 47 51 75 45 47 51 0 2015 2016 2017 2018 2019 2020 Dividend Share repurchase Total shareholder returns 16
Slide 17: Transform | Fast4Ward - all hulls on track
Transform | Fast4Ward® - all 5 hulls on track 17
Slide 18: Transform | Digital transformation throughout the lifecycle
Transform | Digital transformation throughout the lifecycle As-Built Digital Twin e-Commissioning Operational Intelligence & Performance Optimization Center 18
Slide 19: Transform | eMission ZERO
Transform | eMission ZERO 1. Modify emissions emissions Global Greenhouse Gas Emissions related to Oil & Gas Production 1. Global GHG 2. GHG Share 3. Emission Emissions related to Oil & Sources from Oil Gas Production & Gas Production 2. Electrify Fugitive emissions emissions losses 4% Vents 13% Fla
Slide 20: Innovate | Ambition 2030
Innovate | Ambition 2030 25% of SBM Offshore revenues to come from Gas & Renewables by 2030 2040 2040 2018 2018 20% + 25% + Global population Global energy demand Source: IEA 20
Slide 21: FY 2019 Financials
© SBM Offshore 2020. All righ
Slide 22: Directional overview
Directional overview1 Revenue (US$ millions) EBITDA (US$ millions) 2,171 995 921 1,703 784 Underlying EBITDA 832 FY 2018 FY 2019 FY 2018 FY 2019 Pro-forma backlog (US$ billions) Net debt (US$ billions) 20.7 14.8 3.5 2.4 FY 2018 FY 2019 FY 2018 FY 2019 (1) Directional view, presented in the Financial
Slide 23: Financial performance per segment
Financial performance per segment Directional, US$ millions Lease and Operate Turnkey Revenue Underlying EBITDA Revenue Underlying EBITDA 1,298 1,315 856 824 842 53 406 24 FY 2018 FY 2019 FY 2018 FY 2019 FY 2018 FY 2019 FY 2018 FY 2019 “Other” Underlying EBITDA FY 2019 US$(63) million vs FY 2018 US$
Slide 24: 2019 Sources and use of cash
2019 Sources and use of cash Directional, US$ millions Other Underlying Cash from Operations Debt drawdowns investing Sources of cash 736 1,044 88 Uses of cash 418 150 35 74 931 196 217 46 Debt Repayment Growth Share Non- (non-recourse and IFRS16) (Capex + Fast4ward + Acquisition) repurchase recurri
Slide 25: Balance sheet overview
Balance sheet overview Directional, US$ billions Balance sheet is orientated to L&O1 Assets Liabilities and net assets PPE (right of use assets) 0.2 Net working capital, Other Cash and equivalents 0.5 provisions and other 0.6 Financial assets 0.1 Lease liabilities (IFRS16) 0.2 Construction Project D
Slide 26: Business model
Business model Lease and Operate: Turnkey: stable free cash flow generator growth facilitator, cash flow upside SPV SPV SPV Total pro-forma backlog 20.7 • 100% Non-recourse debt • Flexible resourcing model, Asset light • Firm cash flow visibility to 2045 • Turnkey backlog secures > 3 year breakeven
Slide 27: Financing model
Financing model FPSO value Project debt Equity Minimal equity contribution required to finance FPSO construction cost margin RCF Construction Construction Equity / RCF efficient use to bridge Financing RCF Project Finance Project Finance Minimal Equity investment L&O backlog Leveraging backlog to ac
Slide 28: Pro-forma in-hand cash analysis
Pro-forma “in-hand” cash analysis Directional, US$ millions 6 year L&O backlog outlook Avg. 1,350 6 year L&O 2020 2021 2022 2023 2024 2025 operating cash flow conversion1: ~ 61% Cash flow – including Liza Destiny & Unity2 Average amount Operating Cash from L&O ~820 Backlog Debt Redemptions ~(415) In
Slide 29: Building track-record of stable and growing dividends
Building track-record of stable and growing dividends Oil Equipment and Services – Dividend payments for period 2016-2019 Total companies included: 158 0.761 51% No dividend at all 25% Interrupted dividend US$ Dividend per share 38% Annual growth rate2 24% Consistent annual dividend 0.37 50% Dividen
Slide 30: Outlook
OFFSHORE
Slide 31: Guidance
Guidance Directional revenues above US$2.3 billion, of which: • Lease and Operate around US$1.6 billion • Turnkey around US$ 0.7 billion Directional EBITDA around US$900 million 31
Slide 32: Energy. Committed.
Energy. Committed. Doubling Fast4Ward® Ambition dividend momentum 2030 32
Slide 33: w c i} = un . x oO
w c i} = un . x oO
Slide 34: Pro-forma Backlog and borrowings repayment
Pro-forma Backlog1 and borrowings repayment Directional, US$ billions 4 Turnkey backlog Average of 65% of L&O backlog (excl. BOT) represents 2020 0.6 operating cash flow before tax. 2021 1.2 L&O average portfolio duration: 9.6 years2 2022 0.2 Notes: Beyond 2022 1.3 1 Backlog is the undiscounted reve
Slide 35: Pro-forma net cash flow from L&O and BOT
Pro-forma net cash flow1 from L&O and BOT Directional, US$ billions Total Pro-forma Backlog2 Notes: 1 Company estimates based on a variety of long term assumptions which are subject to change. 1.2 TK Rounding applied to nearest hundred million in the L&O and BOT net cash flow which includes opex, de
Slide 36: P&L: underlying items
P&L: underlying items Directional, US$ millions Directional underlying items FY 2018 FY 2019 Impact P&L Segment Total underlying items 188 65 Turritella gain on disposal 217 - Other Operating income Turnkey Yme insurance claim 37 - Other Operating income Turnkey MPF settlement (43) - Other Operating
Slide 37: Lease and Operate P&L
Lease and Operate P&L Directional, US$ millions FY 2018 FY 2019 Variance Revenue 1,298 1,315 17 Gross Margin 413 394 (19) EBIT 418 369 (48) Depreciation, amortization and impairment (406) (473) (66) EBITDA 824 842 18 Underlying EBITDA 824 842 18 Comments Vessels In Liza Destiny Vessels Out Turritell
Slide 38: Turnkey P&L
Turnkey P&L Directional, US$ millions FY 2018 FY 2019 Variance Revenue 406 856 451 Gross Margin 93 130 38 EBIT 225 25 (200) Depreciation, amortization and impairment (54) (28) 26 EBITDA 278 53 (226) Underlying EBITDA 24 53 29 Comments Liza Destiny, Liza Unity, Sepetiba, Castberg and Liuhua turret mo
Slide 39: Group P&L
Group P&L Directional, US$ millions FY 2018 FY 2019 Variance Revenue 1,703 2,171 468 Gross Margin 506 524 18 Overheads (181) (200) (19) Other operating income / (expense) 189 94 (94) Net impairment gain / (loss) 19 - (19) EBIT 533 418 (115) Depreciation, amortization and impairment (463) (503) (41)
Slide 40: 2019 Sources and use of cash
2019 Sources and use of cash Directional, US$ millions L&O 842 Turnkey 53 Other (63) Underlying EBITDA 832 Deferred income (96) Other Underlying Cash from Operations Debt drawdowns2 investing Sources of cash 736 1,044 88 Uses of cash 418 150 35 74 931 196 217 46 Debt Repayment2 Growth Share Non- (no
Slide 41: Cash flow statement
Cash flow statement Directional, US$ millions FY 2019 EBITDA 921 Addition/(release) provision and non-cash items (71) 1 Changes in operating assets and liabilities (414) Income taxes paid (35) Net cash flows from (used in) operating activities 401 Capital expenditures (764) Other investing activitie
Slide 42: Balance Sheet
Balance Sheet Directional, US$ millions Dec-31-18 Dec-31-19 Variance Comment on variation FPSO Liza Destiny, Liza Unity and Sepetiba and share Property, plant & equipment and Intangibles 4,799 5,8491 1,050 acquisition3 Investment in associates and other financial assets 366 304 (62) Repayment of fun
Slide 43: Lease qualification and consolidation methods IFRS 10 & 11
Lease qualification and consolidation methods IFRS 10 & 11 Joint Ventures Lease Contract Type SBM Share % Directional IFRS FPSO N’Goma FL 50% Proportional Equity FPSO Saxi Batuque FL 50% Proportional Equity FPSO Mondo FL 50% Proportional Equity FPSO Cidade de Ilhabela FL 75% Proportional Full consol
Slide 44: Loans and borrowings
Loans and borrowings Directional, US$ millions Net book value as of December 31, 2019 Full Amount IFRS Directional PROJECT FINANCE FACILITIES DRAWN FPSO Cidade de Paraty 421 421 266 MOPU Deep Panuke 137 137 137 FPSO Cidade de Anchieta 307 307 307 FPSO Cidade de Ilhabela 677 677 508 FPSO N’Goma 446 0
Slide 45: Group net debt and borrowings
Group net debt and borrowings Directional, US$ millions Net debt Undrawn facilities + cash 3,500 3,460 964 2,000 2,353 458 500 1,000 -1,000 FY 2018 FY 2019 FY 2019 Lease liabilities Other Project finance Cash Undrawn RCF Directional net cash Undrawn project facilities Average cost of debt FY 2019 Di
Slide 46: RCF Covenants
RCF Covenants Key financial covenant Target FY 2019 Definition Solvency ratio > 25% ✔ 35.7% Tangible net worth1 divided by total tangible assets2 Interest cover ratio > 4.0 ✔ 7.9 Underlying EBITDA3 divided by net interest payable4 Represents maximum theoretical lending capacity, calculated Lease bac
Slide 47: Lease and Operate portfolio
Lease and Operate portfolio (1) FPSO Serpentina is owned by the client and is operated by Gepsing – a subsidiary between SBM Offshore (60%) and GEPetrol (40%) (2) Unit under decommissioning. The charter contract with client until November 2021 remains in place (3) Discussions with the client are ong
Slide 48: © SBM Offshore. All rights reserved. www.sbmoffshore.com
© SBM Offshore. All rights reserved. www.sbmoffshore.com