Saipem S.p.a. · MIL:SPM
Saipem — H1 2010 Earnings Presentation
19 slides from Saipem's earnings presentation, July 2010
Slide 1: Presentation to the Financial Community First Half 2010 Results
Presentation to the Financial Community First Half 2010 Results July 2010
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-looking statements are based on a number of assumptions and expectations that could ultimately prove inaccurate, as they are subject to risks and variables, outside the company’s control, that could cause actual results to differ materially, including currency fluc
Slide 3: Presentation Outline
Presentation Outline ¾ First Half 2010 Financial Results and Backlog Analysis ¾ Oil & Gas Industry Market Outlook ¾ Recent Developments influencing the Oil Services Sector Dynamics a-Macondo Impact on DW Drilling Activities b-M&A Activity in Offshore Sector c-Strong momentum in Onshore Sector
Slide 4: First Half 2010 Financial Results and Backlog Analysis
First Half 2010 Financial Results and Backlog Analysis 4
Slide 5: Financials: Revenues, EBITDA, EBIT, Net Profit
Financials (Mln €) Revenues EBITDA EBIT Net Profit 5385 5158 864 802 % on % on Revenues Revenues 627 194 (7.6%) 582 Revenues % on % on Revenues 164 (6.8%) 2406 2555 138 (5.7%) 176 (6.9%) 90 (27.7%) 81 (30.1%) 31 (11.5%) 35 (10.8%) 182 (52.6%) 146 (51.0%) 380 269 325 100 (35.0%) 118 (34.1%) 374 286 3
Slide 6: Financials: Capex, Sources and Application of Funds, Net Debt
Financials (Mln €) Capex Sources and Application of Funds, Net Debt & D/E Ratio D/E =1.00 1615 3313 28 1500 D/E = 0.83 200 20 2845 200 690 500 880 13 13 782 97 97 66 117 117 1085 403 403 313 313 780 63 240 697 617 367 367 346 782 346 Net Debt Application Sources of Net Debt 1H 2009 2009 1H 2010 2010
Slide 7: Contract Acquisitions & Backlog
Contract Acquisitions & Backlog (Mln €) New Contract Acquisitions Backlog 7059 20404 19015 5068 10261 9135 4781 2340 1727 1368 533 206 3581 3804 331 149 1864 1923 5194 4349 1H 2009 1H 2010 June 30, ’09 June 30, ‘10 (In July 2010 Saipem acquired € 1550 Mln of new orders and increases in the scope of
Slide 8: Backlog Analysis
Backlog Analysis Saipem Exposure to High Quality - Resilient Markets by Client Backlog € 20.40 Bln by Year of Execution 1% 2% @ June, 30 2010 26% 22% 58% 39% 17% 35% Major & Supermajor National 2010 2011 2012 2013+ Independent Others* (*) Mainly-downstream, Smaller and Others by Geo Area by Country
Slide 9: Oil & Gas Industry Market Outlook
Oil & Gas Industry Market Outlook 9
Slide 10: Oil & Gas Industry Market Outlook
Oil & Gas Industry Market Outlook Oil Price stabilizing – Natural Gas still weak 175 150 LEGEND: Oil - WTI ¾ Tentative steps towards Spot Price Natural Henry Hub sustainable economic recovery 125 Base 100 Gas @ 2 Jan. ‘08 Zeebruge 100 ¾ Oil Price perceived as stabilizing 75 (gradually) 50 25 Source:
Slide 11: Recent Developments influencing the Oil Services Sector Dynamics
Recent Developments influencing the Oil Services Sector Dynamics a-Macondo b-M&A Activity in Offshore Sector c-Strong momentum in Onshore Sector 11
Slide 12: Macondo - Impact on DW Drilling Activities
a-Macondo - Impact on DW Drilling Activities - 15% of reserves of Majors and 25% of new fields production estimated to be in Deepwater % Deep water total Oil output % DW Oil output 9.0% 8.8% from fields initiating production 25% 8.6% 7.8% 7.9% 8.1% post-2009 7.3% 18% 6.4% 5.2% Source: 13% Wood Macke
Slide 13: Macondo - Impact on Saipem
a-Macondo - Impact on Saipem - No direct exposure to US GoM drilling market (not a target market for Saipem) Long-term contract house policy for Deepwater Rigs Rig type Pre-Capex DW Fleet Capex Plan 2006-2011 DW Fleet Rig Name Contract period Rig Name Contract period* DW Drillship 3Q09 - 2Q12 3Q10 -
Slide 14: M&A Activity in Offshore Sector
b-M&A Activity in Offshore Sector Consolidation in Field Development segment beneficial for the whole industry Reduced number of stronger contractors More appropriate pricing of risks – – reduced pressure on margins in a weak market Saipem broader portfolio of Business Segments with Powerful Fleet O
Slide 15: Strong Momentum in Onshore Sector
c-Strong momentum in Onshore Sector Examples of Saipem awards in 2010: Shah Gas Development Gas Booster Station BS 171 Client: Abu Dhabi Gas Development Co. Client: Kuwait Oil Company Scope of work: treat and export 1 billion EPC Contract Scope of work: cubic feet a day of sour gas from the Shah - 3
Slide 16: Exploiting Unique E-P-C Industrial Model
c-Strong momentum in Onshore Sector Saipem - Exploiting Unique E-P-C Industrial Model Preserve Margin Profile in Competitive Environment Industrial Model Forward Flexibility & Cost Effectiveness Engineering ¾ Impressive Development of India ‘Hub’ Procurement ¾ Procurement: Improved Work Processes ¾
Slide 17: 2010 Guidance – Mid-year update
2010 Guidance – Mid-year update 2010 Guidance @ February 2010 2010 Guidance @ July 2010 Revenues Maintained (some variation in BU mix) Revenues: +5% Higher EBITDA EBITDA: +10% Increased Depreciation, mainly in Drilling Increased depreciation, mainly in Drilling EBIT Maintained EBIT: +5% Increased fi
Slide 18: Conclusions
saipem Conclusions
Slide 19: Conclusions
Conclusions • Macro scenario remains almost unchanged: Oil Price perceived as stabilizing - Forecast for E&P capex slightly improving • Macondo accident impact: Deepwater to remain a Frontier of the Future, Stricter criteria ref. drilling contract awards but Cost increases Context eventually transfe