[PPT] - Investor Presentation Investor Presentation Investor Presentation PowerPoint Presentation

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Investor Presentation Investor Presentation

November 2016 November 2016

Investor Presentation Investor Presentation

November 2016 November 2016

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Forward-Looking Statements

Statements we make in this presentation that express a belief, expectation, or intention are forward looking. Forward-looking statements are generally accompanied by words such as “estimate ” “project ” “predict ” by words such as estimate, project, predict, “believe,” “expect,” “anticipate,” “plan,” “forecast,” “budget,” “goal,” or other words that convey the uncertainly of future events or outcomes. These forward-looking statements are based on our current information and expectations that involve a number of information and expectations that involve a number of risks, uncertainties, and assumptions. Among the factors that could cause the actual results to differ materially from those indicated in the forward-looking statements are: industry conditions, prices of crude oil and natural gas, our ability to obtain and the timing of new projects, and changes in competitive factors. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, actual

utcomes could vary materially from those indicated.

For additional information regarding these and other factors, see our periodic filings with the Securities and Exchange Commission, including our most recent Reports on Forms 10-K and 10-Q.

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Why Oceaneering?

Global provider of diversified services and products in all phases

f h ff h ilfi ld lif l

Global provider of diversified services and products in all phases

f h ff h ilfi ld lif l

f the offshore oilfield life cycle
Strong market positions
f the offshore oilfield life cycle
Strong market positions
Solid balance sheet and cash flow
Solid balance sheet and cash flow
Return of capital to our shareholders
Leveraged to deepwater

longer term deepwater is still critical to

Return of capital to our shareholders
Leveraged to deepwater

longer term deepwater is still critical to

Leveraged to deepwater - longer term, deepwater is still critical to

reserve replenishment

Leveraged to deepwater - longer term, deepwater is still critical to

reserve replenishment

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5 Operating Segments

1. Remotely Operated Vehicles (“ROVs”)
1. Remotely Operated Vehicles (“ROVs”)

y ( )

2. Subsea Products

y ( )

2. Subsea Products
3. Subsea Projects
3. Subsea Projects
4. Asset Integrity

5 Ad d T h l i

4. Asset Integrity

5 Ad d T h l i

5. Advanced Technologies
5. Advanced Technologies

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EXPLORATION DEVELOPMENT PRODUCTION

DECOMMISSIONING

PHASE

In All Phases of the Offshore Oilfield Life Cycle

EXPLORATION

10%

DEVELOPMENT

50%

PRODUCTION

35%

DECOMMISSIONING

5%

# of Operating Floating Drilling Rigs # of Subsea Tree Installations # of Subsea Trees In Service # of Field Abandonments

PHASE

% OII Revenue

#1 Market Driver

g g g

e Business Segment P d t

ROV

ROV

Survey (SP)

Survey (SP)

Tooling (SSP)

Tooling (SSP)

Product and Service Revenue Streams

ROV
Survey (SP)
Tooling (SSP)

IWOCS I t ll ti &

ROV
Tooling (SSP)
IWOCS (SSP)

S b H d (SSP)

ROV
Tooling (SSP)
IWOCS (SSP)
IWOCS – Installation &

Workover Control Systems (SSP)

Subsea Hardware (SSP)
Umbilicals (SSP)
Vessel-based Installation

Services (SP) Inspection Ser ices (AI)

Subsea Hardware (SSP)
Vessel-based Inspection,

Maintenance & Repair Services (SP)

Inspection Services (AI)

ROV = Remotely Operated Vehicles SSP = Subsea Products SP = Subsea Projects AI = Asset Integrity

Inspection Services (AI)

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Largest Exposure is in Field Development

Oilfi ld R Mi

10% 5%

Oilfield Revenue Mix

35% 50% Exploration Development Production Decommissioning Exploration Development Production Decommissioning

Source: OII Estimates: 2015

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SLIDE 7

Revenue by Business Segment

7% 10%

2014 2015 First 9 Months 2016*

29% 14% 7% 27% 12% 10% 23% 12% 13% 16% 20% 31% 21% 34% 31%

$3.7 Billion $3.1 Billion $1.8 Billion

ROV Subsea Products Subsea Projects Asset Integrity Advanced Technologies

* Nine Months Ended September 30, 2016

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Remotely Operated Vehicles

23%

Revenue Contribution First Nine Months, 2016

Flagship of the Oceaneering Franchise

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g p g

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Oceaneering ROV Fleet Size – 279 ROVs

f S b 30 2016

350

as of September 30, 2016

300 riod End

279

300 Count at Per 250 Vehicle 200 2008 2009 2010 2011 2012 2013 2014 2015 2016 Q1 2016 Q2 2016 Q3*

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* Retired 39 ROVs in the third quarter of 2016.

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Floating Rig Demand History

O i 6% M k Sh f S b 30 2016

100% 300 Floaters Contracted % with OII ROVs

Oceaneering 56% Market Share as of September 30, 2016

75% 200 250 s Period End 50% 150 200 with OII ROVs ing Rigs at P 25% 50 100 % w tracted Float 0%

2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3

Cont

Source: IHS-Petrodata, September 30, 2016

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Oceaneering ROV Utilization Mix

100%

tion

75%

ction Utilizat

50%

ROV Func

0% 25%

Average

0%

Drill Support ROV Utilization Vessel Based ROV Utilization * At September 30

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Oceaneering ROV Pricing and Fleet Utilization

2% Fl U ili i f S b 30 2016

100% $ $11,000 Revenue / Day on Hire Fleet Utilization

52% Fleet Utilization as of September 30, 2016

70% 80% 90% $7 000 $8,000 $9,000 $10,000 n Hire 40% 50% 60% $4 000 $5,000 $6,000 $7,000 eet Utilizatio ue / Day on H 10% 20% 30% $1 000 $2,000 $3,000 $4,000 Fl Revenu 0% 10% $0 $1,000 2008 2009 2010 2011 2012 2013 2014 2015 2016*

* YTD September 2016

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Subsea Products

31% Manufactured Products Production Control Umbilicals

Supply electric and hydraulic power to subsea trees and inject h i l i t i d ll t

Revenue Contribution First Nine Months, 2016

Specialty Subsea Hardware

chemicals into reservoirs and well streams. Field development hardware used to connect production trees to

Service and Rental

Field development hardware used to connect production trees to umbilicals and flow lines. Also includes connectors and valves.

Service and Rental Tooling & Subsea Work Systems

Support drilling, construction, field maintenance, and plugging and abandonment activities. Support drilling, construction, field maintenance, and plugging and

Installation and Workover Control Systems (IWOCS)

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pp g p gg g abandonment activities.

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Subsea Hardware Capex Forecast

B kl S b 30 2016 i $ illi

$9,600 $1,000 Subsea Capex, Quest August 2016 SS Products Backlog

Backlog at September 30, 2016, in $ millions

$6 400 $8,000 $800 Capex acklog $4,800 $6,400 $400 $600 a Hardware C Products Ba $1,600 $3,200 $200 $400 Subsea OII SS $0 $0 2011 2012 2013 2014 2015 2016* 2017F 2018F 2019F 2020F

* At September 30, 2016

Source: Quest Offshore, August 2016; Capex: hardware costs for subsea trees/control systems, manifolds, and production umbilicals 14

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Subsea Installations Forecast

$1,500 500 Tree Installations SSProducts Revenue $1,200 400 in $ Millions ns $600 $900 200 300 ts Revenue, ee Installation $300 $600 100 00 OII SSProduct Tre $0 2011 2012 2013 2014 2015 2016F 2017F 2018F 2019F 2020F O

Source: Quest Offshore, August 2016

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Subsea Projects

21%

Revenue Contribution First Nine Months, 2016

Change out photo and replace with AUV Consist of Project Management Survey Subsea

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Consist of Project Management, Survey, Subsea Installation and IMR Services

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Subsea Projects Overview

f

Deepwater Multi-Purpose Supply Vessels

Spot or Contract Location Charter End 3 Owned

Assets Available for this Market

3 Owned Ocean Intervention Ocean Intervention II Ocean Evolution (available late 2Q 2017) Spot Spot N/A GOM GOM N/A N/A N/A 4 Chartered with Term 4 Chartered with Term Normand Flower Ocean Alliance Ocean Intervention III Island Pride Spot Contract, Shell Contract, BP Contract GOM GOM

W. Africa

India Dec ‘16 Mar ‘18 Apr ‘17 Nov ‘17

Diving Support Vessels
Survey/AUV Services
Survey/AUV Services
Global Data Solutions

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Strong Balance Sheet and Liquidity

C i l S d All i

Liquidity (at end of third quarter 2016)

$442 million of cash $300 million in the U S

Capital Sources and Allocations

$442 million of cash, $300 million in the U.S.
$500 million undrawn revolving credit facility, expiring October 2021
First debt maturities $30 million in October 2018
Organic capital expenditures
Expect to range from $110 million to $125 million in 2016
Acquisitions
Acquisitions
Continue to consider investments that augment our service or product
fferings

Di id d

Dividends
Lowered to a more sustainable level.
Consider share repurchases

p

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Leveraged to Deepwater

Projects take years to develop
Projects take years to develop
Largely oil reservoirs
With high production flow rates
Largely oil reservoirs
With high production flow rates
Well capitalized customer base
~50% revenue from E&P majors in prior 3 years
Well capitalized customer base
~50% revenue from E&P majors in prior 3 years
Investment based on long-term commodity price expectations
Investment based on long-term commodity price expectations

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Long Term: Offshore is Essential

D R i Si ifi

Source of

90 Incremental Bbls Existing Fields Bbls

Deepwater Remains Significant

Source of Additional ~29.3Mm B/D Liquids Production

80 D

29%

60 70 quids MMB/D

71%

50 60 Total Liq

Offshore Onshore

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Source: Morgan Stanley Research , Wood Mackenzie, Rystad Energy, and Company Data – October 2016

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Expect Extended Declines from Producing Fields

4.0 New Production from New Fields Decline from Aging Fields 3.0 3.5 Day 1 5 2.0 2.5 Barrels Per D 0.5 1.0 1.5 Million B 0.0 2014 2015 2016 2017 2018

Inverting Balance presented by Bloomberg; Source data from Rystad

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2016 Fourth Quarter and FY 2017 Outlook

Challenging market continues
Aligning our operations with anticipated level of activity
Forecasting 4Q declines from each of our oilfield segments
ROV: fewer working days and lower average revenue per day
Subsea Products: lower throughput and low single digit margins
Subsea Projects: seasonal decrease in GOM diving activities and

drydocking of Ocean Patriot

Asset Integrity: seasonal decrease in global demand and

competitive pricing

2017 marginally profitable at the operating income level
2017 marginally profitable at the operating income level

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Conclusion

Longer term, deepwater is still critical to reserve replenishment
Global provider in all phases of offshore oilfield life cycle, with

a deepwater focus

Further differentiate with integrated solutions
Strong liquidity and cash flow
Maintain or grow our market positions
Maintain or grow our market positions
Emerge from the current cycle ready for the upturn

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EBITDA Reconciliation to Net Income

(USD i illi )

Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measurement. Oceaneering’s management uses EBITDA because we believe that this measurement is a widely accepted financial indicator used by investors and analysts to analyze and compare companies on the basis of operating performance, and that this measurement may be used by some investors and others to make informed investment decisions. You should not consider EBITDA in isolation from or as a substitute for net

(USD in millions)

T9M T9M

investors and others to make informed investment decisions. You should not consider EBITDA in isolation from or as a substitute for net income or cash flow measures prepared in accordance with generally accepted accounting principles or as a measure of profitability or

liquidity. EBITDA calculations by one company may not be comparable to EBITDA calculations made by another company. The

following table provides a reconciliation between net income (a GAAP financial measure) and EBITDA (a non-GAAP financial measure) for Oceaneering’s historical and projected results on a consolidated basis for the periods indicated:

Period Ended

2011 2012 2013 2014 2015 9 2015 9 2016

Net Income $ 235.7 $ 289.0 $ 371.5 $ 428.3 $ 231.0 $ 203.5 $ 35.6 $ $ $ $ $ $ $ Depreciation & Amortization 151.2 176.5 202.2 229.8 241.2 183.5 194.0 Subtotal 386.9 465.5 573.7 658.1 472.2 387.0 229.6 Interest Expense/Income, Net 0.2 2.3 1.7 4.4 23.4 17.5 15.6 Income Tax Expense 102.2 132.9 170.8 195.2 105.3 92.7 16.2 EBITDA $ 489.3 $ 600.7 $ 746.2 $ 857.7 $ 600.9 $ 497.2 $ 261.4

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Free Cash Flow (Through the Cycle)

(USD i illi f E i Sh )

“Free Cash Flow” (FCF) is a non-GAAP financial measurement. FCF represents cash flow provided by operating activities less organic capital expenditures (i.e., purchases of property and equipment other than those in business

(USD in millions, except for Earnings per Share amounts)

T9M T9M

acquisitions. Management believes that this is an important measure because it represents funds available to reduce

debt and pursue opportunities that enhance shareholder value, such as making acquisitions and returning cash to shareholders through dividends or share repurchases.

2011 2012 2013 2014 2015

2015 2016

Earnings Per Share

$ 2.16 $ 2.66 $ 3.42 $ 4.00 $ 2.34 $ 2.06 $ 0.36

Net Income

$ 235.7 $ 289.0 $ 371.5 $ 428.3 $ 231.0 $ 203.5 $ 35.6

Depreciation & Amortization

151.2 176.5 202.2 229.8 241.2 183.5 194.0

Other Changes in Cash Provided by Operating Activities

(98 3) (27 7) (42 3) 63 7 88 2 ( 13 9) 33 2

by Operating Activities

(98.3) (27.7) (42.3) 63.7 88.2 ( 13.9) 33.2

Cash Provided by Operating Activities

288.6 437.8 531.4 721.8 560.4 373.1 262.8

Purchases of Property & Equipment

(235.0) (300.6) ( 382.5) (386.9) (200.0) (139.2) ( 83.4)

Free Cash Flow

$ 53.5 $ 137.2 $ 148.9 $ 334.9 $ 360.4 $ 233.8 $ 179.4

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SLIDE 27

Oceaneering ROV Leading Market Position

R l O d V hi l

Ownership Drill Support Market Share

Remotely Operated Vehicles

315 31%

OII Subsea 7 Fugro

91 56%

Fugro DOF Subsea C-Innovations Helix Saipem TMT Technip IKM Group Other

Worldwide Fleet 1027 Vehicles* 162 Floating Rigs Contracted** 1027 Vehicles

Source: *OII Estimates - December 2015; **IHS Petrodata and OII Estimates – September 30, 2016

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Oceaneering ROV Fleet – 279 ROVs

G hi P fil S b 30 2016

97 90 100

Geographic Profile – September 30, 2016

60 70 80 46 48 40 40 50 60 ROVs 19 29 10 20 30 10

Other includes Canada, Mexico, United Kingdom, and the Middle East.

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Oceaneering ROVs on Vessels – 94 ROVs

G hi P fil S b 30 2016

30 30 35

Geographic Profile – September 30, 2016

18 22 24 20 25 30 s 18 15 20 ROVs 5 10 GOM Africa Norway Other Approximately 60% of Oceaneering’s vessel-base

Other includes Canada, Mexico, United Kingdom, Middle East, Asia, and Brazil.

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customers are contractors, and 40% are operators

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Investor Relations Contact Suzanne Spera Director Investor Relations Director, Investor Relations 713-329-4707 InvestorRelations@Oceaneering.com

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