Prosafe Se · OSL:PRS
Prosafe — Q2 2006 Earnings Presentation
30 slides from Prosafe's earnings presentation, Aug 9, 2006
Slide 1: Presentation of 2nd quarter 2006
Presentation of 2nd quarter 2006 Oslo, 9 August 2006
Slide 2: Disclaimer
Disclaimer All statements in this presentation other than statements of historical fact are forward-looking statements, which are subject to a number of risks, uncertainties, and assumptions that are difficult to predict and are based upon assumptions as to future events that may not prove accurate.
Slide 3: Agenda
Agenda § The quarter in brief § Financial result for 2nd quarter 2006 § Business divisions – status, strategy and outlook § Summary 3
Slide 4: Q2 2006 in brief
Q2 2006 in brief § A quarter as expected § Conversion projects according to plan § Contract extensions support view of a strong market and high dayrates § 99.8 per cent of Consafe Offshore AB (publ.) acquired § Increased FPSO bidding activity FPSO Polvo at Keppel Shipyard Expect strong growth in ear
Slide 5: Profit and loss account
Profit and loss account (Unaudited figures in USD million) Q2 06 Q1 06 Q2 05 H1 06 H1 05 2005 Operating revenues 75.3 75.1 81.2 150.4 146.1 295.3 Operating expenses (39.8) (31.7) (40.3) (71.5) (74.0) (144.4) Operating profit before depreciation 35.5 43.4 40.9 78.9 72.1 150.9 Depreciation (12.5) (11.
Slide 6: Offshore Support Services
Offshore Support Services (Unaudited figures in USD million) Q2 06 Q1 06 Q2 05 H1 06 H1 05 2005 Operating revenues 53.0 51.5 49.6 104.5 88.1 186.7 Operating expenses (30.0) (19.7) (21.3) (49.7) (41.4) (86.5) Operating profit before depreciation 23.0 31.8 28.3 54.8 46.7 100.2 Depreciation (8.3) (8.4)
Slide 7: Floating Production
Floating Production (Unaudited figures in USD million) Q2 06 Q1 06 Q2 05 H1 06 H1 05 2005 Operating revenues 22.2 23.4 31.8 45.6 58.5 108.3 Operating expenses (9.0) (10.6) (18.2) (19.6) (31.3) (54.0) Operating profit before depreciation 13.2 12.8 13.6 26.0 27.2 54.3 Depreciation (4.1) (3.3) (4.3) (7
Slide 8: Balance sheet
Balance sheet (Unaudited figures in USD million) 30.06.06 31.03.06 31.12.05 30.06.05 Goodwill 348.7 128.3 128.3 128.3 Rigs 780.3 355.4 360.9 369.7 Ships 413.2 354.6 203.8 179.3 Other fixed assets 9.0 8.3 8.2 9.4 Total fixed assets 1 551.2 846.6 701.2 686.7 Cash and deposits 210.9 218.8 303.6 139.4 O
Slide 9: Cash flow
Cash flow (Unaudited figures in USD million) Q2 06 Q1 06 Q2 05 H1 06 H1 05 2005 Net cash flow from operating activities 56.4 111.2 18.5 167.6 50.3 146.7 Net cash flow from investing activities (717.1) (157.2) (3.6) (874.3) (8.8) (45.6) Net cash flow from financing activities 652.8 (38.8) (26.4) 614.
Slide 10: Key figures
Key figures Q2 06 Q1 06 Q2 05 H1 06 H1 05 2005 Operating margin 30.5 % 42.1 % 36.0 % 36.3 % 32.9 % 35.1 % Equity ratio 53.3 % 41.4 % 46.7 % 53.3 % 46.7 % 41.4 % Return on equity 16.6 % 27.3 % 18.8 % 17.1 % 15.9 % 10.5 % Return on capital employed 8.2 % 15.5 % 15.0 % 9.6 % 12.1 % 13.1 % Net interest
Slide 11: Shareholders at 31 July 2006
Shareholders at 31 July 2006 SHAREHOLDERS No of shares Ownership JCE 4 756 149 10.8 % Morgan Stanley & Co (nom.) 4 536 467 10.3 % State Street Bank & Trust (nom.) 3 746 914 8.5 % Folketrygdfondet 2 929 297 6.7 % Brown Brothers Harriman 2 414 128 5.5 % Odin 1 490 261 3.4 % GMO 1 126 337 2.6 % JP Morg
Slide 12: Consafe – financial impact
Consafe – financial impact § Purchase price for 100 per cent of the shares: USD 532 million § Allocation of purchase price in excess of book equity: ú Rigs USD 129.4 million ú Goodwill USD 220.3 million ú Total USD 349.7 million § Alignment of accounting policies ú Useful life of all Consafe vessels
Slide 13: Refinancing completed early Q3
Refinancing completed early Q3 § New USD 450 million facility replaces old Prosafe ASA debt of USD 257 million. § 18-24 month grace period followed by quarterly instalments of USD 18 million § 7-year term with balloon payment of USD 54-90 million § Very competitive terms § Conventional covenants str
Slide 14: Total debt overview
Total debt overview § New: USD 450 million secured debt facility with seven-year term § New: USD 150 million debt and guarantee facility with seven-year term (Consafe) § Three bond loans of total NOK 500 million (89 million/2007 and 411 million/2010) and USD 50 million (2012) § Further debt capacity
Slide 15: Offshore Support Services – status
Offshore Support Services – status § 2 vessels mobilised for contracts in the North Sea § Strong contract extensions § Safe Bristolia commences work at Sakhalin § Safe Concordia well positioned in the Onboard Safe Scandinavia GoM 15
Slide 16: Offshore Support Services – contract status
Offshore Support Services – contract status Safe Astoria Asia Safe Bristolia Safe Esbjerg Safe Caledonia North Sea/ Safe Scandinavia West Africa MSV Regalia Safe Concordia Safe Britannia Safe Lancia Gulf of Safe Regency Mexico Jasminia Safe Hibernia 1Q04 3Q04 1Q05 3Q05 1Q06 3Q06 1Q07 3Q07 1Q08 3Q08
Slide 17: Offshore Support Services - rig utilisation
Offshore Support Services - rig utilisation 2006 1) 8% 92 % 2007 30 % 70 % 2008 40 % Available units will benefit from 60 % increasing dayrates Contract Available 17 1) Inclusive Consafe rigs from 1 July 2006
Slide 18: Offshore Support Services – strategy and outlook
Offshore Support Services – strategy and outlook Strategic focus: § Maintain position as the world’s largest owner and operator of high-end accommodation and service rigs Short term outlook § Strong demand for available units Safe Concordia Medium term outlook: § Redeployment at higher dayrates The
Slide 19: Floating Production – status
Floating Production – status § Conversion projects are progressing as planned § Significant increase in earnings as from Q2 2007 § Increased bidding activity § Capacity to start new projects in 2006 § Available hull Abo FPSO A leading position in the FPSO market outside the North Sea 19
Slide 20: Floating Production - contract status
Floating Production - contract status Tui NZOP, New Zealand è 2017 Polvo Devon, Brazil è 2022 Abo Agip, Nigeria Espoir Ivoirien Canadian Natural Resources, Ivory Coast è 2022 Petr. Nautipa (1) CNR, Angola Vaalco, Gabon Al Zaafarana (2) ç 1994 Zaafarana Oil Comp, Gulf of Suez Endeavor ç 1997 Aban Loy
Slide 21: Floating Production - operational strength
Floating Production - operational strength § High uptime on FPSOs confirms quality of designs and operational competence § Technology support through own engineering organisation ú Direct access to designers and engineering team ú Continuous improvement FPSO Espoir Ivoirien Strong operational perfor
Slide 22: Status - Polvo
Status - Polvo § VLCC with storage capacity of 1.6 mill barrels § Prosafe turret and swivel with deepwater capacity § Vessel at Keppel Shipyard, Singapore § All major equipment ordered § First dry dock completed § Project progressing as planned § Estimated time of start-up: Q2 2007 On time and withi
Slide 23: Status - Tui
Status - Tui § Suezmax with storage capacity of 0.8 mill barrels § Prosafe turret and swivel with deepwater capacity § Vessel at Keppel Shipyard, Singapore § All major equipment ordered § First dry dock completed § Project progressing as planned FPSO for Tui at Keppel Shipyard § Estimated time of st
Slide 24: Floating Production – strong Singapore FPSO cluster
Floating Production – strong Singapore FPSO cluster Turret/Swivel are Prosafe Process facilities are designs fabricated in engineered and fabricated in Singapore Singapore FPSO layout is designed and engineered by Prosafe in Singapore Hull repair and life extension are executed in Singapore 24
Slide 25: Floater projects in the bidding/final design stage
Floater projects in the bidding/final design stage Units/ fields 50 45 40 35 30 25 20 15 10 5 0 Nov '05 Mar '06 Jul '06 Explosion in demand for floaters 25 Source: IMA, July 2006
Slide 26: 109 Floaters in the planning stages
109 Floaters in the planning stages Units/ fields 25 20 60-70 are likely 15 to be FPSOs 10 5 0 ric a si a ic o a zil op e /N Z he r f st A x Br r lia Ot .A a f Me . Eu tra W e s u th lf o No Au o Gu S Floater Projects in the Longer Term Planning Stage Floater Projects in the Bidding/Final Design Sta
Slide 27: All-time high bidding activity
All-time high bidding activity § Prosafe actively pursues several new FPSO projects with expected awards H2 2006/early 2007 § Available engineering capacity from Q4 § Access to hulls and shipyards for the relevant projects § More competition on smaller/less complex projects – less competition on lar
Slide 28: Floating Production – strategy and outlook
Floating Production – strategy and outlook § Positioned as one of the leading suppliers and operators of high quality FPSOs outside the North Sea § Strong competitive edge based on in-house technology and project experience § Capacity to commence at least a third FPSO conversion in 2006 ú Available
Slide 29: Summary and outlook
Summary and outlook § Solid financial performance § Financial performance expected to improve considerably the next 2 - 3 years § Rig dayrates improving § FPSO projects on time and within budget § Well positioned to grow in the FPSO market A focused oil service company with strong positions in a gro
Slide 30: Capital markets day – 22 August 2006
Capital markets day – 22 August 2006 § Capital markets day will be held on 22 August 2006 § President & CEO Arne Austreid and Prosafe’s corporate management team will provide insight into Prosafe’s strategy, business divisions and growth opportunities § Please register no later than 14 August by sen