Subsea 7 S.a. · OSL:SUBC
Subsea 7 — Q1 2016 Earnings Presentation
28 slides from Subsea 7's earnings presentation, Apr 28, 2016
Slide 1: Earnings Presentation First Quarter 2016
Earnings Presentation First Quarter 2016 28 April 2016 12:00 noon UK time 1
Slide 2: Forward-looking statements
Forward-looking statements Certain statements made in this announcement may include ‘forward-looking statements’. These statements may be identified by the use of words like ‘anticipate’, ‘believe’, ‘could’, ‘estimate’, ‘expect’, ‘forecast’, ‘intend’, ‘may’, ‘might’, ‘plan’, ‘predict’, ‘project’, ‘s
Slide 3: Jean Cahuzac, CEO
A =z J ean Cahuzac CEO
Slide 4: Q1 2016 highlights
Q1 2016 highlights FINANCIAL OPERATIONAL ORDER INTAKE OUTLOOK • Revenue • Strong project • Order backlog • Challenging $746m execution increased to market • Adjusted • Reduced cost $6.5 billion conditions EBITDA base • Order intake • Timing of new $284m • Increased $1.1 billion awards still • Adjust
Slide 5: Business Unit performance overview
Business Unit performance overview Northern Hemisphere Southern Hemisphere and Life of Field and Global Projects • Continued activity in the US • Several large projects reached Gulf of Mexico with a focus on final stages of execution low-cost and fast-track • East Nile Delta and West Nile solutions
Slide 6: Q1 Backlog and order intake
Q1 Backlog and order intake • Backlog of $6.5 billion(1), as at 31 March 2016 • $1.1 billion order intake including announced awards: – West Nile Delta Phase 2, offshore Egypt; – Life of Field contract extension, offshore UK Backlog by Execution Date Backlog by Service Capability Backlog by Hemisphe
Slide 7: Ricardo Rosa, CFO
A =z Ricardo Rosa CFO
Slide 8: Income statement – key highlights
Income statement – key highlights Three months ended 31 Mar 16 31 Mar 15 In $ millions, unless otherwise indicated Unaudited Unaudited Revenue 746 1,181 Net operating income (NOI) 194 176 Income before taxes 211 211 Taxation (64) (60) Net income 147 151 Adjusted EBITDA(1) 284 281 Adjusted EBITDA mar
Slide 9: Business Unit performance – Q1 2016
Business Unit performance – Q1 2016 Northern Hemisphere and Life of Field Southern Hemisphere and Global Projects Revenue Revenue $562m $617m $413m $331m Q1 16 Q1 15 Q1 16 Q1 15 Northern Hemisphere and Life of Field Southern Hemisphere and Global Projects NOI NOI $149m $118m $48m $37m Q1 16 Q1 15 Q1
Slide 10: Summary of first quarter 2016 cash flow
Summary of first quarter 2016 cash flow $ millions Cash and cash equivalents at 31 Dec 2015 947 Increase of $29 million in net Net cash generated from operating activities 281 operating liabilities Included capital expenditure of $82 Net cash flow used in investing activities (74) million mainly on
Slide 11: Capital expenditure for vessel new-build programme
Capital expenditure for vessel new-build programme(1) # vessels under construction at 6 5 4 0 year end $ millions 65 557 544 499 Forecast 275 Actual spend to date Upto 31 Dec 2013 2014 2015 2016 E (1) Comprises four PLSVs being constructed for long-term contracts with Petrobras (including Seven Wave
Slide 12: Financial guidance
Financial guidance 2016 Guidance Revenue Significantly lower than 2015 Adjusted EBITDA percentage margin Lower than 2015 Administrative expense $240 million - $250 million Net finance charge $5 million - $10 million Depreciation and Amortisation $400 million - $420 million Full year effective tax ra
Slide 13: Jean Cahuzac, CEO
A =z J ean Cahuzac CEO
Slide 14: Delivering market-driven cost-effective solutions
Delivering market-driven cost-effective solutions Early engagement Technology and innovation Integrated solutions Brent oil price ($) 140 Partnerships 120 100 Ways of working 80 60 Resize 40 20 0 Mar 14 Sep 14 Mar 15 Sep 15 Mar 16 14
Slide 15: Making it happen – three current examples
Making it happen – three current examples West Nile Delta Phase 1, offshore Egypt Fast-track gas project for Egypt Early engagement engineering New ways of working applied Innovation of equipment design Coelacanth, US Gulf of Mexico Fast-track:10 weeks from award to completion Optimised use of onsho
Slide 16: Our resizing and reorganising
Our resizing and reorganising • Actively adapt to industry conditions … – 2015 Resizing and cost reduction programme completed in first quarter 2016 – Resized our workforce to below 10,000 (2013: over 14,000) – Resized our active fleet to 27 vessels (2014: 39 vessels) – Additional cost reduction mea
Slide 17: Business Unit outlook
Business Unit outlook • Timing of new awards to market remains highly uncertain Northern Hemisphere and Life of Field • Seasonal increase in activity expected in the North Sea in the summer • Life of Field: potential for increase in activity outside the North Sea Southern Hemisphere and Global Proje
Slide 18: Q&A
Q&A 18
Slide 19: Appendix
Appendix • Our global presence • Major project progression • Adjusted EBITDA • Segmental analysis • Supplementary Income statement • Balance sheet summary • Our fleet 19 19
Slide 20: Our global presence
Our global presence • Catcher, Premier • Culzean, Maersk • Callater, Apache • Martin Linge, Total • Western Isles, Dana • Aasta Hansteen, Statoil • Montrose, Talisman • Maria, Wintershall • USC & Pipelay, Shell • Mariner, Statoil • SCIRM, BP • DSVi, Various • Stampede, Hess • Coulomb Ph2, Shell • Ho
Slide 21: Major project progression
Major project progression Continuing projects >$100m between 5% and 95% complete as at 31 March 2016 excluding PLSV and Life of Field day-rate contracts Lianzi Topside (Angola) Montrose (UK) Clair Ridge (UK) TEN (Ghana) Southern Martin Linge (Norway) Hemisphere Mariner (UK/Norway) Northern Persephon
Slide 22: Adjusted EBITDA
Adjusted EBITDA • Adjusted earnings before interest, taxation, depreciation and amortisation (‘Adjusted EBITDA’) is a non-IFRS measure that represents net income before additional specific items that are considered to impact the comparison of the Group’s performance either period-on-period or with o
Slide 23: Reconciliation of Adjusted EBITDA
Reconciliation of Adjusted EBITDA Net operating income to Adjusted EBITDA Three Months Ended Three Months Ended 31 Mar 2016 31 Mar 2015 For the period (in $millions) Net operating income 194 176 Depreciation, amortisation and mobilisation 90 102 Impairment of property, plant and equipment - 3 Adjust
Slide 24: Segmental analysis
Segmental analysis For the three months ended 31 March 2016 Northern Hemisphere Southern Hemisphere In $ millions (unaudited) Corporate TOTAL and Life of Field and Global Projects Revenue 331 413 3 746 Net operating income 37 149 8 194 Finance income 4 Other gains and losses 14 Finance costs (1) Inc
Slide 25: Income statement – supplementary details
Income statement – supplementary details In $ millions Three months ended 31 Mar 16 31 Mar 15 Unaudited Unaudited Administrative expenses (53) (70) Share of net income of associates and joint ventures 16 15 Depreciation and amortisation (90) (102) Impairment of property, plant and equipment - (3) Ne
Slide 26: Summary balance sheet
Summary balance sheet 31 Mar 31 Dec 31 Mar 31 Dec 2016 2015 2016 2015 In $ millions Unaudited Audited In $ millions Unaudited Audited Assets Equity & Liabilities Total equity 5,441 5,346 Non-current assets Non-current liabilities Goodwill 753 767 Non-current portion of borrowings 453 524 Property, p
Slide 27: Our fleet as at 31 March 2016
Our fleet as at 31 March 2016 • 27 vessels in the active fleet 8 Chartered: 19 Owned: Rockwater 2 Skandi Acergy Seven Borealis Seven Atlantic Normand Seven Seven Oceans Seven Falcon Grant Candies Seven Condor Seven Osprey Normand Subsea Seven Rio Seven Pelican Siem Stingray Seven Seas Kommandor 3000
Slide 28: 27-Apr-16 Page 28
27-Apr-16 Page 28