Tidewater Inc. · NYSE:TDW
Tidewater — Louisiana Energy Conference 2019
30 slides from Tidewater's conference presentation, May 29, 2019
Slide 1: Company Overview
Company Overview Louisiana Energy Conference 2019 John Rynd President, Chief Executive Officer and Director May 29, 2019
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Tidewater Inc. (the “Company”) notes that certain statements set forth in this Current Report on Form 8-K provide other than historical information and are forward lookin
Slide 3: Tidewater Overview
Tidewater Overview As of May 24, 2019 market close Founded TDW Cash & Equiv 1955 $22.54 $400 Created the industry’s first Offshore Support Vessel Employees million 5,500 Vessel Fleet globally Market Cap Net Debt Debt Maturities $1 $39 ~$350 million senior secured 241 Active Fleet million notes due 2
Slide 4: Peer Market Cap & Price Comparison
Peer Market Cap & Price Comparison 2018 OSV Equities Total Return Equity Market Cap 1,200 1,000 Market Cap ($mm) 800 1% 600 400 -22% -19% -26% -25% 200 -46% -54% 0 -65% Tidewater SEACOR Bourbon Siem DOF Standard NAO Hornbeck Solstad Eidesvik Havila -72% Net Capitalization 100% 4% 2018 Driller Equiti
Slide 5: The Largest OSV Owner Globally
The Largest OSV Owner Globally Vessel Count (AHTS & PSVs) as of March 31, 2019 Tidewater 214 241 OSVs Total Fleet Incl. Bourbon All Vessel Types Edison Chouest Solstad Swire COSL Tidewater 2019 fleet dry-dockings Hornbeck planned SEACOR Topaz Harvey Gulf Vroon Avg. All Others All Others (~2,400 tota
Slide 6: The Most Geographically-Diverse OSV Operator
The Most Geographically-Diverse OSV Operator Revenue by Vessel Class Active Fleet Avg. Active Fleet Age Utilization North Sea & 2018 0 Mediterranean 170 9.6 80.6% 2 Sea 6% Vessels Years 34 37% 57% 32 Utilization 84.1% Middle East & Americas Asia Pacific 39 0 43 Headquarters 2 Area Operations 9 West
Slide 7: High-Spec OSV Rates are Rising
High-Spec OSV Rates are Rising Source: Clarksons Platou Offshore, Tidewater Louisiana Energy Conference 2019 | ©Tidewater Inc. 7
Slide 8: The North Sea – More Activity & Demand Improvements
The North Sea – More Activity & Demand Improvements …as long as reactivations are limited this season North Sea Contracted Floating Rigs North Sea PSV Utilization by Size 2014 to 2019 April 2019 Utilization Rigs Source: Clarksons Platou Securities Louisiana Energy Conference 2019 | ©Tidewater Inc. 8
Slide 9: West African Rig Count Driving OSV Demand
West African Rig Count Driving OSV Demand West Africa Rig Count by Type Active PSVs and Total Utilization 2014 to 2019 2014 to 2019 Utilization Vessels Rigs Source: Clarksons Platou Securities Louisiana Energy Conference 2019 | ©Tidewater Inc. 9
Slide 10: Right-Sizing Our Fleet for Future Demand
Right-Sizing Our Fleet for Future Demand PSV Utilization by Vessel Spec Category OSV Demolitions & Removals 100% 100 92% 89 90% 90 83% 78% 80% 80 71% 63 Number of vessels 70% 66% 70 62% 59% 60 Utilization 60% 51 50% 50 Demand improving for 40 32 34 40% recent vintage, higher 26 29 30% 30 specificati
Slide 11: Vessel Reactivations Under Way for 2019
Vessel Reactivations Under Way for 2019 2019 OSV Reactivations Completed & Planned As of May 2019 Approx. Associated Approx. Term Backlog (excl. options) (excl. options) $110 26 million vessel years Middle East Nigeria Thailand Angola Guyana 10 Avg. Cost for Reactivation per Vessel $1.4 million Loui
Slide 12: Improved Identification of Cost Synergies
Improved Identification of Cost Synergies June 2018 Integration progressing extremely well with run-rate annual G&A $33 $145 Pro Forma $112 G&A Profile $100 expected to now approximate $87 million million million by year end 2019 Target run-rate G&A now below Tidewater’s stand alone Q3 2018 Today ru
Slide 13: G&A Cost Trends
G&A Cost Trends Strong focus on becoming the most 4,000 cost efficient OSV operator 3,500 Reducing G&A spend without 3,505 compromising our core values of 3,000 safety, compliance and service is 2,500 differentiating 2,583 $2,092 Average • $686 reduction in 2,000 cost per active day 2,224 Developing
Slide 14: Strategic Priorities
Strategic Priorities Leadership in safety, compliance and operational excellence Protect and preserve strong liquidity position Efficient and complete realization of merger cost and operational synergies Rationalization of fleet and cost structure to provide scope for margin expansion in the upturn
Slide 15: Why you should own Tidewater
Why you should own Tidewater A truly investable name in the offshore sector Operational Leading OSV Financial Excellence Fleet Strength • An industry leader in safe • The largest OSV fleet in the • Strong balance sheet with low operations world, diversified to support any leverage • The broadest ope
Slide 16: Tidewater Inc. Worldwide Headquarters
TIDEWATER INC. Worldwide Headquarters 6002 Rogerdale Road Suite 600 Houston, Texas 77072 USA P: +1 713 470 5300 www.tdw.com
Slide 17: Appendix I – Reference
Appendix I – Reference
Slide 18: Safety Leadership Remains a First Priority
Safety Leadership Remains a First Priority Total Recordable Incident Rates 2007-2018 (per 200,000 Man Hours) TRIR = Sum of LTAs and Recordables x 200,000 divided by Man Hours Worked 0.5 0.5 1.00 0.90 1.0 0.0 1.0 0.0 0.80 0.70 0.14 0.12 10 year average 2018 0.60 0.50 0.40 0.30 0.20 0.10 0.00 2007 200
Slide 19: Board of Directors
Board of Directors Tom R. Bates, Jr. Alan Carr Randee E. Day Dick Fagerstal Steven L. Newman Louis Raspino Larry T. Rigdon John T. Rynd Robert P. Ken Traub Chairman, CEO, Drivetrain CEO, Chairman & CEO Former CEO, Former CEO, Former Interim President & CEO, Tamburrino Former Managing Tidewater Inc.
Slide 20: Executive Management Team
Executive Management Team John T. Rynd Quintin V. Kneen Bruce D. Lundstrom Jeff A. Gorski President, CEO & Director EVP & Chief Financial Officer EVP, General Counsel & EVP & Chief Operating Officer Secretary Management incentive plan updates • Ensuring that the company’s executive compensation prog
Slide 21: Vessel Utilization Trends Incrementally Improving
Vessel Utilization Trends Incrementally Improving Tidewater Fleet Utilization 2014 to 2019 YTD 90% 80% 81% 70% 60% 54% 50% 40% 30% 20% 10% 0% Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 2014 2015 2016 2017 2018 2019 Ut
Slide 22: Vessel Average Day Rates Stable
Vessel Average Day Rates Stable Average Day Rates by Vessel Class 2014 to Q1 2019 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $- Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 2014 2015 2016 2017 2018 2019 Deep
Slide 23: Fleet Valuation
Fleet Valuation Vessel Net Book Value as of March 31, 2019 Vessel Class Vessel Count NBV Average Age Avg NBV / Vessel (in millions) (years) (in millions) Deepwater vessels PSVs > 3,800 DWT 57 $ 540.7 7.8 $ 9.5 PSVs < 3,800 DWT 59 $ 253.7 11.2 $ 4.3 Deepwater AHTS 19 $ 65.3 11.2 $ 3.4 135 $ 859.8 9.8
Slide 24: Oil Companies are Generating Record Cash Flow
Oil Companies are Generating Record Cash Flow Top 30 E&P's with offshore output - FCF (pre & post dividends) vs capex* 200 600 500 150 400 300 100 USDbn (Capex) 200 USDbn (FCF) 50 100 0 0 (100) (200) (50) (300) (100) (400) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
Slide 25: Current Oil Prices are (so far) Still Economic for Offshore Projects
Current Oil Prices are (so far) Still Economic for Offshore Projects Breakeven oil prices of discovered but undeveloped offshore resources Perspectives 30 100% 100% 100% • Nearly all offshore oil makes 98% 99% 100% 100% 100% 100% 100% sense near current prices after 89% 25 fall in marginal productio
Slide 26: Working Rig Count is Improving
Working Rig Count is Improving Offshore Working Rig Count 2008 to 2019 YTD Incremental OSV demand 800 and utilization improvements will be 700 driven by an increase in 445 the working rig count 600 Total working rigs Jackup utilization as of May 20, 2019 continues to gradually 500 improve 24 Floater
Slide 27: Jackup Utilization is Growing; Floaters Will Drive Deepwater OSV Demand
Jackup Utilization is Growing; Floaters Will Drive Deepwater OSV Demand PSV demand growth vs. Rig count growth (YoY) Offshore rig count growth (YoY) 20% 15% 10% 10% 7% 5% 3% 0% 0% Rig count growth YoY -5% YoY growth -5% -10% -10% -15% -20% -20% -30% -25% -30% -40% Jan-10 Jan-11 Jan-12 Jan-13 Jan-14
Slide 28: A Large Percentage of the Global Stacked Fleet Likely Uneconomic to Reactivate
A Large Percentage of the Global Stacked Fleet Likely Uneconomic to Reactivate 1,000 ~50% 400+ Est. global out of service >15 years old and …modern, high-specification PSVs have seen the most reactivations stacked fleet for >3 years laid up >2 years Source: Clarksons Platou Research and IHS Petrodat
Slide 29: Newbuild Orders Not Likely to Significantly Impact Supply
Newbuild Orders Not Likely to Significantly Impact Supply Years from Existing % of fleet on % on order ex. Average % of fleet >25 Overdue Vessel type Vessels % China/India Order date order date fleet order India/China age years old survey PSV +5,000 DWT 13 54 % Aug-13 5.5 188 7% 3% 6 1% 12 % PSV 4-5
Slide 30: OSV Second Hand Prices Appear to have Bottomed
OSV Second Hand Prices Appear to have Bottomed …but transactions have been limited PSV Resale Prices PSV Newbuilding Prices as January 2019 as January 2019 PSV Resale, Medium, 700 m2 deck PSV Resale, Medium, 800 m2 deck PSV 3,200 dwt, European Yard, 500-750 m2 deck PSV Resale, Large, 1,000 m2 deck P