Akastor Asa · OSL:AKAST

Akastor Asa — Q1 2019 Earnings Presentation

30 slides from Akastor Asa's earnings presentation, May 2, 2019

  1. Slide 1: First Quarter Results 2019

    Akastor ASA First Quarter Results 2019 Karl Erik Kjelstad (CEO) & Leif Borge (CFO) Fornebu | 2 May 2019 Akastor © 2019 Akastor

  2. Slide 2: Presenters and agenda

    Presenters and agenda Group highlights Karl Erik Kjelstad Portfolio companies highlights Chief Executive Officer Financial update Leif Borge Q&A session Chief Financial Officer Akastor © 2019 | May Akastor 2019 Slide 2

  3. Slide 3: Q1 2019 highlights

    Q1 2019 highlights Revenue EBITDA Net Capital Employed Net Interest Bearing Debt NOK 1.1bn NOK 92m NOK 4.7bn NOK 290m  Revenue of NOK 1.1 billion, 21% percent growth year-on-year − Revenue of NOK 258 million from AKOFS Offshore (not consolidated)  EBITDA of NOK 92 million − Including positive effe

  4. Slide 4: Portfolio companies highlights

    Portfolio companies highlights Akastor © 2019 | May Akastor 2019 Slide 4

  5. Slide 5: Akastor portfolio composition

    Akastor portfolio composition Industrial investments Financial investments 100% 17% Leading global provider of first-class drilling systems, Global O&G manpower specialist products and services 50% USD 75m preferred equity International drilling, well service and engineering Global provider of subse

  6. Slide 6: Portfolio Highlights Q1 2019

    Portfolio Highlights Q1 2019  Still limited newbuilding activity in the market  Slow recovery of services, stronger demand for upgrading rigs with Digital Technologies  Revenues of NOK 904 million in Q1, 24% growth year-on-year  EBITDA of NOK 88 million (including effect of IFRS 16 of NOK 17 mil

  7. Slide 7: Key drivers in favour of increased investments in offshore

    Key drivers in favour of increased investments in offshore The oil price has rallied +42% YTD… …OilCo’s has the capital available… Brent oil price (USD/bbl) Total cash flows for top 20 listed integrated E&P companies (USDbn) 90 500 85 80 400 75 70 300 65 60 200 55 50 100 45 40 0 2007 2008 2009 2010

  8. Slide 8: Financial update

    Financial update Akastor © 2019 | May Akastor 2019 Slide 8

  9. Slide 9: Financials Q1 2019

    Financials Q1 2019 Q1 Q1 NOK million 2019 2018 Q1 2019 highlights Revenue 1 070 881  Revenues up 21% compared with Q1 2018 EBITDA 92 63  EBITDA of NOK 92 million includes effect from IFRS 16 EBIT 31 16 (new leasing standard) of NOK 27 million Net financials 37 (49)  Depreciation of NOK 61 million

  10. Slide 10: Key financials reconciliation

    Key financials reconciliation Q1 Q1 Q1 Q1 Revenue (NOK million) 2019 2018 Net financial items (NOK million) 2019 2018 MHWirth 904 731 Odfjell Drilling 47 - Step Oiltools 58 53 Awilco Drilling 13 15 First Geo 30 32 NES Global Talent 17 10 Cool Sorption 60 17 DOF Deepwater (6) (26) Other 30 54 AKOFS O

  11. Slide 11: Cash flow and net debt position

    Cash flow and net debt position Net debt bridge Q1 2019 highlights NOK million  Net interest-bearing debt position increased by NOK 144 million to NOK 290 million 638  Other Net Debt increase of NOK 124 million mainly driven by lease payments and funding of (124) Seafarer capex (16)  Liquidity re

  12. Slide 12: Net Capital Employed as per Q1 2019

    Net Capital Employed as per Q1 2019 NOK million 144 (290) 544 791 1 077 4 721 4 431 3 623 2 164 Other Net Capital NIBD Equity (excl. Market Cap Employed hedge reserve) 30.04.2019 Akastor © 2019 | May Akastor 2019 Slide 12

  13. Slide 13: MHWirth

    MHWirth Highlights Q1 2019 Installed base per Q1 2019  Project & Products revenues for Q1 were NOK 414 million, an Full package (rigs) Installed base by age increase of 23% compared to last year Fixed >20 0-5  DLS revenues for Q1 were NOK 490 million, an increase of 24% 21 18 18 compared to last y

  14. Slide 14: AKOFS Offshore

    AKOFS Offshore Highlights Q1 2019 Fleet overview  Revenues for Q1 of NOK 258 million Vessels Loc. 2018 2019 2020 2021  EBITDA of NOK 136 million, increase from 2018 mainly due to Equinor (ends Q1 Preparation / Yard 2025, 3 years consolidation of Avium Subsea (which is owned 100% by AKOFS option) O

  15. Slide 15: NES Global Talent

    NES Global Talent Recent development Award winning workforce solution specialist  Continued strong contract activity, with further increase in total Global organization number of contractors with local client  Growth versus last year driven by solid organic growth as well as touch-points through a

  16. Slide 16: Other Holdings

    Other Holdings Highlights Q1 2019  Revenues for the first quarter were NOK 148 million, an increase of 45% compared to last year. EBITDA of NOK 15 million, up 10 million from last year  Step Oiltools: Revenues in Q1 of NOK 58 million, in line with Q1 2018. EBITDA of NOK 4 million, up NOK 2 million

  17. Slide 17: Appendix

    Appendix Akastor © 2019 | May Akastor 2019 Slide 17

  18. Slide 18: Transactions track-record since inception in 2014

    Transactions track-record since inception in 2014 December 2018 September 2018 April 2018 May 2018 November 2017 Merged for an economic 50% sale to interest stake of 55% Preferred equity ~6% share purchase ~3% share sale investment USD 142.5m USD 75m1) USD 10m NOK 88m June 2017 March 2017 December 2

  19. Slide 19: ODL preferred equity and warrant instrument

    ODL preferred equity and warrant instrument Preferred equity of USD 75m Warrant structure Instrument description: Instrument description:  5% cash dividend + 5% PIK per annum (semi-annual payment)  The total warrant issue comprise six tranches with 987,500 warrants per tranche, amounting to a tota

  20. Slide 20: Condensed consolidated Income Statement

    Condensed consolidated Income Statement First Quarter Full Year NOK million 2019 2018 2018 Revenue and other income 1 070 881 3 800 Operating expenses (978) (818) (3 509) EBITDA 92 63 290 Depreciation, amortization and impairment (62) (47) (181) Operating profit (loss) 31 16 109 Net financial items

  21. Slide 21: Condensed consolidated statement of financial position

    Condensed consolidated statement of financial position March 31 December 31 NOK million 2019 2018 Deferred tax asset 366 374 Intangible assets 1 258 1 260 Property, plant and equipment 776 825 Right-of-Use assets 496 - Other non-current assets 62 62 Non-current finance lease receivables 20 - Equity

  22. Slide 22: Condensed Consolidated Statement of Cash flows

    Condensed Consolidated Statement of Cash flows First Quarter Full Year NOK million 2019 2018 2018 Profit (loss) for the period 62 (19) (322) (Profit) loss for the period – discontinued operations - (15) 128 Depreciation, amortization and impairment – continuing operations 62 47 181 Other adjustments

  23. Slide 23: Alternative Performance Measures (1 of 2)

    Alternative Performance Measures (1 of 2) Akastor discloses alternative performance measures as a supplement to  Net current operating assets (NCOA) - a measure of working capital. It the consolidated financial statements prepared in accordance with IFRS. is calculated by current operating assets m

  24. Slide 24: Alternative Performance Measures (2 of 2)

    Alternative Performance Measures (2 of 2) March 31 December 31 March 31 December 31 NOK million 2019 2018 NOK million 2019 2018 Non-current borrowings 789 588 Current operating assets 3 377 3 472 Current borrowings 17 14 Less: Current operating liabilities Gross debt 805 601 2 935 3 189 Derivative f

  25. Slide 25: Key figures

    Key figures AKASTOR GROUP NOK million Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 2018 Operating revenue and other income 881 873 955 1 090 3 800 1 070 EBITDA 63 78 87 63 290 92 EBIT 16 31 41 21 109 31 CAPEX and R&D capitalization 17 8 68 37 131 16 NCOA 687 617 547 375 375 521 Net capital employed 7 196 7 461 4 7

  26. Slide 26: Split per Company (1 of 3)

    Split per Company (1 of 3) MHWIRTH NOK million Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 2018 Revenue and other income 731 681 751 893 3 055 904 EBITDA 69 68 71 73 281 88 EBIT 37 36 39 45 156 47 CAPEX and R&D capitalization 4 8 11 36 58 16 NCOA 782 671 613 405 405 487 Net capital employed 2 499 2 347 2 258 2 11

  27. Slide 27: Split per Company (2 of 3)

    Split per Company (2 of 3) AKOFS OFFSHORE 1) NOK million Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 2018 Revenue and other income 262 289 290 266 258 1 107 EBITDA 86 123 118 144 136 471 EBIT 7 (280) 78 68 56 (127) CAPEX and R&D capitalization 11 (1) 54 124 144 188 NCOA 238 217 214 180 76 180 Net capital employed

  28. Slide 28: Split per Company (3 of 3)

    Split per Company (3 of 3) OTHER HOLDINGS NOK million Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 2018 Revenue and other income 148 197 197 207 178 749 EBITDA (14) 2 5 (11) 4 (18) EBIT (29) (13) (8) (24) (16) (74) CAPEX and R&D capitalization 3 1 2 2 - 8 NCOA (95) (54) (66) (30) 34 (30) Net capital employed 743 1

  29. Slide 29: Effects from IFRS 16 Leases implementation

    Effects from IFRS 16 Leases implementation Q1 2019 Real estate and holding NOK million MHWirth Step Oiltools companies Akastor Revenue and other income - - (8) (8) EBITDA 17 1 9 27 Depreciation (14) - (8) (21) EBIT 3 1 1 5 Net financial items (5) - (2) (7) EBT (2) 1 (1) (1) Note: IFRS 16 Leases is i

  30. Slide 30: Copyright and disclaimer

    Copyright and disclaimer Copyright Copyright of all published material including photographs, drawings and images in this document remains vested in Akastor and third party contributors as appropriate. Accordingly, neither the whole nor any part of this document shall be reproduced in any form nor u

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