Quarterly Presentation Q4 2018
DOF Subsea Group
DOF Subsea Group at a glance
2
2005DOF Subsea
established
NOK 1.2bn1)
Revenues
Q4’18
1 3112)
Subsea employees
worldwide Q4’18
NOK 15.5bnFirm backlog
Q4’18
283)
Subsea vessels
71ROVs
ModernState-of-the-art
asset base
IntegratedSupplier of subsea
offshore services
DOF Subsea1) Note: According to management reporting
2) Note: Excluding marine crew
3) Note: Including newbuild Skandi Olinda and chartered-in vessels Harvey Deep-Sea, Harvey Subsea, Skandi Chieftain and Skandi Darwin
Global footprint
3
ATLANTIC
NORTH AMERICA
BRAZILASIA PACIFIC
Macaé
Rio de Janeiro
Buenos
Aires
Houston
St John’s
Aberdeen
Bergen
Luanda
Singapore
Manila
Melbourne
Jakarta
BruneiKuala Lumpur
Darwin
Perth
3788
38910
2504
2945
DOF Subsea1) Note: Number of employees as at end of Q4’18, excluding marine crew
2) Note: Vessels in operation as at end of Q4’18, including 4 chartered-in vessels (excluding newbuild under construction)
Local operating model ensuring on-the-ground responsiveness towards clients’ needs
Large and global organisation following multiple
acquisitions from 2005-2010
11 1113
1618
21
2425
2627
24
21
2527
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Q4 2018
Development in number of vessels in operation2)
Owned vessels Chartered-in vessels Total
337
553 563
8971014
1246
14921354
1667
1858
1566
1278 12141311
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Q4 2018
Development in number of DOF Subsea Employees1)
More than a decade of structural growth and consolidation
DOF Subsea 4
SEMAR
Focus on consolidation and streamlining of
business operations to improve efficiency and
competitiveness in weak market
DOF Subsea established following the
acquisition of Geoconsult. The Company was
listed second half 2005.
First Reserve acquires 49% of DOF Subsea,
which in the following is delisted from the Oslo
Stock Exchange
Expanding organisation on the back of several
large contract awards. Number of employees
and vessels peaking at 1 858 and 27,
respectively
2010Century SubseaCovus Subsea
CSL
2005
2008
2014
2016
Awarded four PLSV long-term contracts in joint
venture with TechnipFMC2013
SWG Offshore
1) Note: Marine crew not included
2) Note: Newbuild not included
3) Note: Period-end numbers
2018
Delivery of two newbuilds entering into long-term
contracts and commencement of two long-term
IMR contracts2017
Delivery of one JV newbuild entering into long-
term contract and award of several long-term
contracts within both business segments and start
rebuilding the organization
Key financials1)
5
Revenue EBITDA2) Firm backlog
DOF Subsea1) Note: Figures according to management reporting
2) Note: EBITDA excl. profit from sale of non-current assets
0%
5%
10%
15%
20%
25%
30%
35%
40%
-
500
1 000
1 500
2 000
2 500
2012 2013 2014 2015 2016 2017 2018
NOK million EBITDA margin
-
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
2012 2013 2014 2015 2016 2017 2018
NOK million
-
5
10
15
20
25
2012 2013 2014 2015 2016 2017 2018
NOK billion
Segment highlights
Two business segments
DOF Subsea 7
DOF Subsea Group
Long-term Chartering1)
Revenues Q4’182)
NOK 399 million
EBITDA Q4’183)
NOK 298 million
~75% margin
Firm backlog4)
NOK 11.3bn
1) Note: Long-term Chartering comprises 6 PLSVs in operation and 1 PLSV under construction, plus
Skandi Acergy and Skandi Patagonia
2) Note: According to management reporting
3) Note: According to management reporting
4) Note: Firm backlog as at end of Q4’18
5) Note: Including 4 chartered-in vessels
1 newbuild Q4’188 vessels in
operation Q4’18
Long-term
charters
Vessel
capabilitiesCapex
spending
Subsea / IMR Projects
Revenues Q4’182)
NOK 767 million
EBITDA Q4’183)
NOK 44 million
~6% margin
Firm backlog4)
NOK 4.2bn
1 311 Employees
Q4’18
19 vessels in
operation5) Q4’18
Engineering
capabilities
Framework
agreements
Opex
spending
8
Numerous projects completed and ongoing worldwide
Built a leading subsea projects division for over a decade
• Subsea project activity established with a global footprint in all key offshore regions
• High quality asset base leveraging unrivalled subsea and vessel operating competence
A clear action plan to pursue further opportunities
• Continue to increase the scope and complexity of operations
− Strengthen presence in selected geographies
− Further build project backlog with core focus on IMR projects
Subsea/IMR Projects
Selected Mooring projects – Last 5 yearsSelected IMR projects – Last 5 years
✓ Petrobras DSV Contract (2018-2021)
✓ Petrobras RSV Contract (2018-2020)
✓ ENI Angola IMR Contract (2017-2019)
✓ Husky Energy IMR Contract (2017-2027)
✓ Shell Prelude IMR Contract (2017-2022)
✓ Goliat Field Support ENI (2016)
✓ Chevron Gorgon IMR Contract (2015-2019)
✓ Shell Malampaya IMR Contract (2014-2021)
✓ ConocoPhillips ROV Services (2012 and onwards)
✓ ROV Support Vessel Petrobras (2011 and onwards)
✓ Egina FPSO Hook-up (2018)
✓ Lam Son Mooring Replacement (2017)
✓ Bergading FPSO Pre-Tensioning (2017)
✓ Yinson OCTP FPSO Field Dev. (2016-2017)
✓ Bongkot Mooring Replacement PTTEP (2017)
✓ Raroa Mooring OMV (2016-2017)
✓ Gina Krog TMRS Teekay (2016)
✓ Catcher Mooring Installation BWO (2016)
✓ Goliat FPSO Marine Installation ENI (2011-2015)
✓ Lam Son Mooring Installation PTSC (2014)
DOF Subsea
DOF Subsea provides state-of-the-art vessels to leading players
9
Skandi Acergy Skandi Acu Skandi Africa
Skandi Niteroi Skandi Patagonia Skandi Vitoria
Skandi Buzios Skandi Recife Skandi Olinda
Day-rate basedRemuneration
Strong long-term contract coverageContracts
High-end vessels operating advanced subsea projects for third party EPCI contractors
Operations
Selected clients
Construction
support vessel
Construction & pipe
laying vessel
Construction & pipe
laying vessel
Construction & pipe
laying vessel
Construction & pipe
laying vessel
Construction & pipe
laying vessel
Construction & pipe
laying vessel
Dive support
vessel
Construction & pipe
laying vessel
8
vessels in
operation
1
contracted
newbuild
NOK 11.3bn
firm backlog
per Q4’18
Long-term Chartering
DOF Subsea
Selected long-term contracts
10DOF Subsea
• Long-term FLNG IMR contract
awarded in Australia with
Shell
• 5 years + 4 years options
• IMR scope comprising project
management, engineering,
logistics, vessel and ROV
services
• Utilising Skandi Darwin
Prelude FLNG
Nov 2017
• Long-term contract with
Petrobras
• 8 years + 8 years options
• Vessel owned in joint venture
with TechnipFMC
• Built in Brazil with 300t VLS
• Long-term DSV contract with
Petrobras
• 3 years + 2 years options
• ROV and diving services
• Partnered up with diving
partner in Brazil
Skandi Recife
Jun 2018 • Long-term contract with
Petrobras
• 8 years + 8 years options
• Vessel owned in joint venture
with TechnipFMC
• Built in Brazil with 300t VLS
• Long-term contract with
Petrobras in Brazil
• Vessel and ROV services
Skandi Salvador
Aug 2018 Skandi Achiever
Sep 2018
Skandi Olinda
Feb 2019
DOF Subsea newbuild program completed
The Group took delivery of Skandi Vinland and the vessel entered a 10-year contract with Husky Energy in July 2017
The DOFCON JV has since 2016 taken delivery of four PLSVs (two from yard in Norway and two from yard in Brazil)
▪ Skandi Açu delivered and on-hire on 8-year contract with Petrobras in August 2016
▪ Skandi Buzios delivered and on-hire on 8-year contract with Petrobras in April 2017
▪ Skandi Recife delivered and on-hire on 8-year contract with Petrobras in June 2018
▪ Skandi Olinda delivered and on-hire on 8-year contract with Petrobras in Feb 2019
The PLSV project was delivered according to budgeted cost, giving DOF Subsea an annual EBITDA of USD 110
million
All newbuild contracts provide stable earnings visibility for the Group
DOF Subsea 11
Skandi Vinland (Subsea), delivered 2017 Skandi Açu (PLSV), delivered 2016 Skandi Buzios (PLSV), delivered 2017 Skandi Recife (PLSV), delivered 2018 Skandi Olinda (PLSV), delivered 2019
4th quarter 2018
Q4 2018 highlights
• The operating revenue for the quarter was NOK 1 166 million1), EBITDA was NOK 342 million1) and overall
vessel utilisation was 69%.
• During the quarter, the Group strengthened the organization and management team.
• 2 year extension of existing IMR contract with Chevron Australia.
• Refinancing of Skandi Achiever with an international shipping bank.
• Issued a new 5-year bond loan of NOK 900 million in the Norwegian High-Yield market.
DOF Subsea 131) Note: Figures according to management reporting
Quarterly performance1)
DOF Subsea 141) Note: Figures according to management reporting, and excluding profit from sale of non-current assets
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
500
1 000
1 500
2 000
2 500
Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018
EB
ITD
A m
arg
in
NO
K m
illi
on
Operating revenue EBITDA EBITDA margin
NOK million Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018
Operating revenue 2 025 1 656 1 962 1 991 1 642 1 406 1 660 1 232 1 128 982 1 199 1 093 1 275 1 053 1 203 1 184 1 166
EBITDA 502 458 515 553 516 456 510 447 320 279 400 332 402 310 372 376 342
EBITDA margin 24,8 % 27,7 % 26,2 % 27,8 % 31,4 % 32,4 % 30,7 % 36,3 % 28,4 % 28,4 % 33,4 % 30,4 % 31,5 % 29,4 % 30,9 % 31,8 % 29,3 %
Current assets 4 223 3 414 3 414 3 674 3 752 2 900 3 010 2 742 2 483 2 808 2 595 2 501 2 607 2 399 2 474 2 320 2 532
Non-current assets 15 796 16 726 16 578 16 447 16 818 17 652 18 206 18 514 18 043 18 087 18 428 17 926 17 829 16 881 17 684 17 523 17 818
Total assets 20 019 20 140 19 992 20 121 20 570 20 552 21 216 21 256 20 526 20 896 21 023 20 427 20 436 19 280 20 158 19 843 20 350
Current liabilities 4 505 4 139 4 577 4 492 3 650 2 991 3 022 2 645 2 478 2 444 3 010 3 051 2 440 2 345 2 879 2 983 3 484
Non-current liabilities 9 402 9 924 9 009 9 988 11 228 11 482 11 864 12 174 11 993 12 503 11 942 11 221 11 648 10 485 11 110 10 798 11 130
Equity 6 112 6 077 6 405 5 641 5 692 6 078 6 330 6 437 6 055 5 948 6 071 6 156 6 348 6 450 6 170 6 063 5 735
Total equity and liablilites 20 019 20 140 19 991 20 121 20 570 20 551 21 216 21 256 20 526 20 896 21 023 20 427 20 436 19 280 20 158 19 843 20 350
Debt maturity profile1)
DOF Subsea 15
Debt maturity profile, 2019E – 2023E
1) Note: Figures according to management reporting and based on exchange rates as at end of Q4’18
The figures reflect amortization and balloon payments on outstanding debt as at end of Q4’18
-
500
1 000
1 500
2 000
2 500
3 000
3 500
2019E 2020E 2021E 2022E 2023E Thereafter
Bond Loan Bank Debt Balloons
Backlog1)
DOF Subsea 161) Note: Figures based on remaining backlog as at end of Q4’18 and exchange rates as at end of Q4’18
2) Note: Contract backlog excludes master service agreements (MSAs) within the Subsea/IMR Projects segment – only confirmed POs are included in the backlog
As at 31 December 2018, the Group’s firm contract backlog was NOK 15.5 billion
2019 2020 2021 2022 2023 Thereafter
Option Revenue 0,09 0,26 0,72 1,12 1,17 14,13
Firm Revenue 3,66 2,94 2,35 1,85 1,60 3,13
0
2
4
6
8
10
12
14
16
18
20
NO
K B
illio
n
Firm Revenue Option Revenue
Modern high-end fleet
• Majority of the fleet is younger than 10 years
• Modern fleet with a value adjusted average fleet age of 6.51) years
• High-end vessels, capable of a wide scope of worldwide operations
DOF Subsea 171) Note: Excluding chartered-in vessels, and figures as at end of Q4’18
Skandi Vinland, CSV built 2017
Skandi Buzios, PLSV built 2017
Skandi Recife, PLSV built 2018
2000-2006; 6
2007-2012; 12
2013-2018; 5Newbuild; 1
Year of delivery DOF Subsea fleet1)
-
2,0
4,0
6,0
8,0
10,0
12,0
Fleet age
Average fleet age age
Value adjusted average fleet age
Skandi Olinda, PLSV built 2019
Appendix
Condensed profit & loss1)
DOF Subsea 191) Note: Financial statement according to IFRS. Condensed financial statement according to management reporting is included in the DOF Subsea Quarterly Financial Report
Profit & loss (NOK million) 4Q 2018 4Q 2017 2018 2017
Operating revenue 945 1068 3 742 3 849
Payroll expenses -354 -368 -1 375 -1 420
Other operating expenses -431 -462 -1 688 -1 593
Share of net income of associates and joint ventures 104 54 403 303
Profit from sale of non-current assets - - 1 -5
Operating profit before depreciation (EBITDA) 264 292 1085 1135
Depreciation and impairment -291 -201 -913 -999
Operating profit (EBIT) -26 91 172 136
Financial income 55 13 96 55
Financial expenses -148 -132 -507 -521
Realised net gain / loss on derivative instruments and currency position -78 8 -168 -80
Unrealised net gain / loss on derivative instruments and currency position -244 -194 -214 288
Net financial income / loss -414 -305 -794 -259
Profit / loss before tax -440 -215 -622 -123
Income tax expense -18 -161 -46 -150
Profit / loss for the period -458 -375 -668 -273
Condensed balance sheet1)
DOF Subsea 201) Note: Financial statement according to IFRS. Condensed financial statement according to management reporting is included in the DOF Subsea Quarterly Financial Report
Assets (NOK million) 31.12.2018 31.12.2017
Tangible assets 11 100 11 773
Goodwill 337 366
Deferred tax asset 220 243
Investment in associates and joint ventures 1 553 1027
Non-current receivables 1 204 1 125
Non-current assets 14 414 14 534
Trade receivables 631 855
Other current receivables 289 252
Total current receivables 920 1 107
Restricted cash 223 311
Unrestricted cash and cash equivalents 919 786
Cash and cash equivalents 1142 1 097
Current assets 2 062 2 204
Total assets 16 476 16 738
Equity and liabilities (NOK million) 31.12.2018 31.12.2017
Paid-in equity 4 344 4 344
Other equity 1 197 1 778
Non-controlling interests 194 226
Total equity 5 735 6 348
Bond loans 2 480 1 914
Debt to credit institutions 5 278 6 518
Other non-current liabilities 34 49
Non-current liabilities 7 793 8 481
Current portion of debt 2 177 1 191
Trade payables 406 392
Other current liabilities 366 325
Current liabilities 2 949 1 909
Total liabilities 10 742 10 390
Total equity and liabilities 16 476 16 738
Thank you!
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