Helix Energy Solutions Group, Inc. · NYSE:HLX
Helix Energy Solutions — Citigroup 2006 Small & Mid-Cap Conference
37 slides from Helix Energy Solutions's conference presentation, Mar 17, 2006
Slide 1: Citigroup 2006 Small & Mid-Cap Conference
Citigroup 2006 Small & Mid-Cap Conference Las Vegas, Nevada March 15, 2006 Owen Kratz - Chief Executive Officer Wade Pursell - Chief Financial Officer
Slide 2: Forward-Looking Statements
Certain statements made herein contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "expect," "will," "look forward to" and similar expressions are intended to ide
Slide 3: Additional Information
Helix and Remington will file a proxy statement/prospectus and other relevant documents concerning the proposed merger transaction with the Securities and Exchange Commission ("SEC"). Investors are urged to read the proxy statement/prospectus when it becomes available and any other relevant document
Slide 4: Presentation Outline
Helix Strategy Business Lines Financial Information Recent Highlights & Near Term Goals Appendix Presentation Outline H E L I X E N E R G Y S O L U T I O N S
Slide 5: Helix Energy Solutions Group, Inc.
Helix Energy Solutions Group, Inc. Ticker symbol: NASDAQ: HELX Website: www.HelixESG.com Trading commenced on the NASDAQ with new ticker symbol HELX on Monday, March 6, 2006 Helix Energy Solutions H E L I X E N E R G Y S O L U T I O N S
Slide 6: Guiding Principles
H E L I X E N E R G Y S O L U T I O N S Guiding Principles Vision Statement To be a leading provider of select life of field solutions on all energy projects but with a specialty for marginal energy resources, further differentiated by a preference to share risk / reward through participation in ene
Slide 7: Strategy
Strategy H E L I X E N E R G Y S O L U T I O N S
Slide 8: Industry Macro Issues
Industry Macro Issues H E L I X E N E R G Y S O L U T I O N S Increasing Number of Mature and Small Reservoirs Increasing Ratio of Contribution to Global Production from Marginal Fields Increasing Subsea Development Highly Cyclical Market
Slide 9: Helix: A Full Cycle Energy Service Company
Helix: A Full Cycle Energy Service Company H E L I X E N E R G Y S O L U T I O N S We provide development solutions and related services to the energy market and specialize in the exploitation of marginal fields where we differentiate ourselves by taking oil and gas production as well as cash as pay
Slide 10: Two Stranded Strategy
Two Stranded Strategy Contracting Services & = Reduced Cyclicality (Steady Growth) And Superior Financial Returns H E L I X E N E R G Y S O L U T I O N S Oil & Gas Production
Slide 11: Contracting Services and Oil & Gas Production structure
Q4000 Seawell Structure / Resources Structure / Resources Contracting Services Marco Polo Ind. Hub Gunnison Shelf Contr. (Cal Dive) Well Operations Drilling Reservoir & Well Tech Serv 4 DP DSVs 4 Sat DSVs 15 Diving Vessels 3 Pipelay Vessels Oil & Gas Production Deepwater Contracting 180 + Engineers
Slide 12: Application of Contracting Services
H E L I X E N E R G Y S O L U T I O N S Exploration Appraisal Development Abandonment Production Application of Contracting Services Reservoir & Well Tech Services Drilling Production Facilities Construction Well Operations 'Full cycle cost can be reduced by at least 20% compared to conventional app
Slide 13: Our Offices
Houston Aberdeen Houston Aberdeen Singapore Houston Morgan City Houston Port Arthur New Iberia Lafayette Rotterdam London Aberdeen Kuala Lumpur Perth H E L I X E N E R G Y S O L U T I O N S Our Offices
Slide 14: Contracting Services
Contracting Services H E L I X E N E R G Y S O L U T I O N S
Slide 15: Two Stranded Approach
Two Stranded Approach External Contracting & = H E L I X E N E R G Y S O L U T I O N S Production Contracting Internal Backlog And Superior Return on Capital Reservoir & Well Tech Services Drilling Production Facilities Construction Well Ops.
Slide 16: Services - Reservoir and Well Technology
Services - Reservoir and Well Technology CoreTeams(tm) - outsourced integrated reservoir management and well technology capabilities OnDemand(tm) - consultancy services Pulse(tm) - online analysis of upstream data FaultFinder(tm) - high definition analysis of faulting FlowDoctor(tm) - flow assurance
Slide 17: Services - Drilling: Q4000 Upgrade
H E L I X E N E R G Y S O L U T I O N S Q4000 Upgrade Addition Of Modular-Based Drilling System Hybrid Slimbore Technology Designed For Deepwater Exploration And Appraisal Scheduled Completion: Early 2007 Services - Drilling
Slide 18: Services - Production Facilities
H E L I X E N E R G Y S O L U T I O N S Host production facilities capitalizing on "Hub and satellite" field concept of the Deepwater Gulf Fixed monthly demand charges and volumetric tariff charges Farm-In opportunities Installation of facility and Subsea tiebacks Services - Production Facilities
Slide 19: Services - Construction
Technically diverse DP Fleet Reel Lay and S -Lay Specialized Assets Target Niche Markets Deepwater Track Record; installed pipe in 5,600 feet Sat and Surface Diving Construction and abandonment Inspection, repair and maintenance Work Class ROV Systems Trenching/Burial Expertise DP Vessels Global Ope
Slide 20: Services - Well Operations
Life of field services Recognized industry leader Alternative to drill rig 25% - 50% cost advantage Riser based technology Established position in largest world market Property sales to Independents SIL based technology UK Market Seawell Q4000 US Market Services - Well Operations
Slide 21: Oil & Gas Production
" Oil & Gas Production
Slide 22: Oil and Gas Production
Access to both deepwater prospects and the means to exploit them Operatorship in deepwater 100% ownership of Remington properties allows Helix to control own destiny Prospect generation Targeting 30% fleet utilization with Remington / ERT activity (backlog > $1 Billion) Complements expanding deepwat
Slide 23: Remington Prospect Portfolio
H E L I X E N E R G Y S O L U T I O N S Bottom-up reserve risk assessment based on historical success rates. 5-7 year drilling inventory. Targeting 30% fleet utilization with Remington/ERT activity. Remington Prospect Portfolio 1 Over $1 Billion of life of field services involved.
Slide 24: Combined Deepwater Portfolio
Combined Deepwater Portfolio Independence Hub Telemark Bass Lite Marco Polo Noonan Devil's Island Tiger Gunnison Tulane Ty Webb Motor Mouth Al Czervik H E L I X E N E R G Y S O L U T I O N S Drillable with Q4000 Remington Deepwater Prospects Helix Fields Helix Production Facilities
Slide 25: Post Remington Numbers
Combined Production : > 220 mcfe/d (2006) Combined Proven Reserves : > 500 bcfe (end 2005) Combined Deepwater Fields : > 30 Combined Risked Prospects : > 1,400 bcf Associated Services Backlog : > $1,000 m Post Remington Numbers H E L I X E N E R G Y S O L U T I O N S
Slide 26: Cal Dive Hedges
Cal Dive Hedges: As Of February 28, 2006 H E L I X E N E R G Y S O L U T I O N S Production Period Instrument Type Average Monthly Volumes Weighted Average Price Crude Oil Jan - Dec 2006 Collars 125 MBbl $44.00 - $70.48 Jan - Dec 2007 Collars 50 MBbl $40.00 - $62.15 Natural Gas Jan - Dec 2006 Collar
Slide 27: Financial Information
H E L I X E N E R G Y S O L U T I O N S Financial Information
Slide 28: Consistent Top Line Growth
Consistent Top Line Growth 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Contracting Services 32.7 63.9 93.9 139 128 110 164 240 259 300 500 700 Oil & Gas 4.8 12.2 16.5 12.6 32.5 70.8 63.4 62.8 137.3 243 272 400 36% CAGR Revenues in Millions H E L I X E N E R G Y S O L U T I O N S Esti
Slide 29: Bottom Line
Bottom Line 2002 2003 2004 2005 2006 12.4 32.8 79.9 150 191 82 Net Income in Millions Range H E L I X E N E R G Y S O L U T I O N S Estimate
Slide 30: Significant Cash Generation
Significant Cash Generation 2002 2003 2004 2005 2006 65.8 126.9 239.3 353 490 128 EBITDA in Millions (see GAAP reconciliation at www.HelixESG.com) Estimate Range H E L I X E N E R G Y S O L U T I O N S
Slide 31: Return on Capital Invested
2001 2002 2003 2004 2005 2005 12 5 7 13 17 22 Return on Capital Invested 4th QTR 12 5 7 13 17 22 Percentage (see calculation at Company's website - www.HelixESG.com) H E L I X E N E R G Y S O L U T I O N S 32
Slide 32: CAPEX Mix
CAPEX MIX Marine Contracting Oil & Gas Production 58 42 2002 - 2005 $1 Billion Marine Contracting Oil & Gas Production 25 75 Contracting Services Oil & Gas Production 42 58 $ 1.5 Billion 2007 - 2009 Projected $1.2 Billion 2006 Projected Contracting Services Oil & Gas Production H E L I X E N E R G Y
Slide 33: Debt to Book Capitalization
MARAD Construction and Other Debt Long Term Revolving Credit (Amounts in Millions) 12/31/05 12/31/04 12/31/03 12/31/02 Debt To Book Capitalization 40% 35% 22% 40% Convertible Notes H E L I X E N E R G Y S O L U T I O N S
Slide 34: Pro Forma Debt Summary
Pro Forma Debt Summary Pro forma interest coverage of 7.1x2 on TTM EBITDA. Projected Pro Forma 2006 Debt Service Coverage of 9.6x2 Projected Debt to TTM EBITDA at Closing: 2 to 1 __________________________ 1 Floating rate, seven-year term, 1% amortization. 2 See GAAP reconciliation at Company's webs
Slide 35: 2006 Objectives (Excluding Remington)
2006 Objectives (Excluding Remington) Contracting Services Revenues: $650 - 750 million Margins: 25% - 35% Equity earnings: $27 - 32 million Achieve mechanical completion of the Independence Hub Begin construction for next facility opportunity Oil and Gas Production 44 - 47 Bcfe of production Begin
Slide 36: Highlights Last 6 Months
Acquired Torch fleet including Midnight Express Acquired Stolt North America fleet Acquired Helix RDS - reservoir engineering and well technology Announce conversion of cablelay ship into S- lay Vessel Caesar Announced drilling upgrade Q4000 Production Assumed operatorship Telemark deepwater field i
Slide 37: Near Term Goals
Install drilling capability on the Q4000 Mechanical completion of Independence Hub facility by Q4 06. Increase through-put on Marco Polo via K2, K2 North and other tie backs. Begin construction on next floating production system Engineer and execute development of ERT PUDs Monetize via divestment of
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