INVESTOR PRESENTATION September 2016 Exploration and Beyond… working to increase the value and output of active reservoirs
Disclaimer • The content of this presentation has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000 (“FSMA”). Reliance on this presentation for the purposes of engaging in investment activity may expose an individual to a significant risk of losing all of the property or other assets invested • The information in this presentation is subject to updating, completion, revision, further verification and amendment without notice • This presentation does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company, nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, or act as an inducement to, enter into any contract or commitment thereto • This presentation is only being distributed and made available to persons of the kind described in Article 19(5) (investment professionals) and Article 49(2) (high net worth companies, unincorporated associations, etc) of Part IV of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 (“FPO”). Persons who do not have professional experience in matters relating to investment or who are not persons to whom Article 49 of the FPO applies should not rely upon this presentation • No reliance may be placed for any purpose whatsoever on the information or opinions contained in this presentation or any other document or oral statement, or on the completeness, accuracy or fairness of such information and/or opinions therein • No representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its directors, or any other person as to the accuracy or completeness or fairness of the information or opinions contained in this presentation and no responsibility or liability is accepted by any of them for such information or opinions or for any errors, omissions, misstatements, negligent or otherwise, or for any communication written or otherwise, contained or referred to in this presentation • Accordingly, neither the Company nor any of its directors, officers, employees, advisers, associated persons or subsidiary undertakings shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying upon the statement or as a result of any admission in, or any document supplied with, this presentation or by any future communications in connection with such documents and any such liabilities are expressly disclaimed • This presentation and its contents are confidential and should not be distributed, published or reproduced in whole or in part or disclosed by recipients to any other person. This presentation is not for distribution outside the United Kingdom and, in particular, should not be distributed to persons with addresses in Canada, Australia, Japan, Republic of Ireland, Republic of South Africa, or to persons with addresses in the United States of America, its territories or possessions or to any citizen thereof or to any corporation, partnership or other entity created or organised under the laws thereof. Any such distribution could result in the violation of Canadian, Australia, Japanese, Irish, South African or United States of America law. Prospective investors interested in investing in the Company are recommended to seek their own independent financial advice from a person authorised for the purposes of the FSMA 2
1H16 Overview • Strong operating performance from WGP on the Statoil project – Completion of 2 surveys (Snorre and Grane) as part of the ongoing contract to provide seismic source services to Statoils PRM activities in the North Sea • Progress on the ARL flying node development programme – Redesign of Autonomous Node completed – Prototype under construction – Prototype initial testing targeted for Q4 2016 • Final stages of design and procurement of fifth generation PMSS TM for deployment on new contract with ConocoPhillips (“COP”) in Q3 3
1H16 Financial Highlights Group Results Group Revenue Gross Profit $10.0 60.00% $35.0 56.70% $9.0 $30.0 50.00% 49.90% $8.0 $25.0 $7.0 42.60% $5.2 40.00% $19.0 $6.0 $6.7 35.30% $20.0 $2.6 $5.0 30.40% 30.00% $15.0 $9.0 $4.0 $6.2 $3.0 20.00% $3.0 $10.0 $10.0 $4.2 $2.0 $4.0 $11.6 10.00% $5.0 $9.9 $9.3 $2.9 $2.6 $1.0 $1.9 $5.2 $4.0 $0.0 $0.0 0.00% 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 1H 2H Gross Margin 1H 2H Operating Profit (EBITDA) $5.0 20.0% Net Profit $4.5 25.00% $4.0 15.3% 19.50% 14.4% $4.0 20.00% 15.0% $3.5 16.10% $3.0 13.70% $3.0 15.00% 8.6% $3.4 $2.5 10.0% 11.20% $2.0 $2.0 $2.2 10.00% $2.9 $1.5 3.7% 5.0% $1.0 $1.0 $1.1 5.00% $0.9 $1.5 $1.3 1.20% $1.0 $0.2 $0.5 $0.8 $0.4 0.0% $0.2 $0.3 $0.5 $0.4 $0.0 $0.0 0.00% -$0.5 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 -$1.0 -3.2% -5.0% 1H 2H Operating Margin 1H 2H Net Margin 4
2015 Financial Highlights Balance Sheet Net Assets $m's Net Cash $m's $60.0 $2.50 $35.0 $1.40 $1.29 $30.0 $1.20 $50.0 $2.04 $2.00 $25.0 $1.00 $0.86 $1.57 $40.0 $1.50 $0.71 $20.0 $0.80 $1.17 $1.12 $30.0 $0.59 $32.2 $15.0 $0.60 $51.2 $1.00 $0.77 $20.0 $39.4 $10.0 $20.3 $0.40 $17.7 $26.4 $25.9 $0.19 $0.50 $13.2 $10.0 $5.0 $0.20 $10.3 $2.5 $0.0 $0.00 $0.0 $0.00 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 NAV NAV per share Net Cash Cash per Share 5
1H16 WGP Operational Highlights Statoil • Now in third full year of operation • Completion of 2 successful surveys to client’s satisfaction over Grane and Snorre • 4,500km of data acquired over the 2 fields • Operational performance improvements reducing technical downtime and increasing operational productivity • Zero HSE incidents ConocoPhillips (“COP”) • Planning and preparation for the first survey due in Sep 16 • Procurement process well underway for the new PMSS TM • Pre- build of Local Operating Centre (“LOC”) commenced 6
WGP Outlook WGP • Continuation of the Statoil contract with deployment expected late September 2016 • First LoFS survey for COP requiring biannual marine acquisition and shore side data QC to commence September 2016 following assembly, shake down and testing of the equipment • Follow up on new PRM enquiries/tenders received 7
1H16 ARL Operational Highlights Flying Node Development Programme • Following successful presentation at SEG in 2015, further presentation at EAGE generating considerable interest • Design and manufacture of the first prototype node commenced • Computational Fluid Dynamics (CFD) performed with targeted improvements in node efficiency and stability included in first design • Operating costs reduced to a minimum 8
ARL Outlook ARL • Complete design and manufacture of the first prototype node • Progress software solutions for the prototype node • Develop first stage testing programme • Start testing the node in ROV (tethered) mode • Review potential for further patent applications 9
Thalassa Investments/Acquisitions Thalassa • Papua Mining plc (“Papua”) • Entered into an agreement to purchase 40,000,000 new shares in Papua for £400k. • Upon closing of the transaction, the Company will appoint a Director to the Board of Papua to work with the current Board to formulate a profitable, cash generative growth plan. • The Local Shopping REIT plc (“LSR”) • the Company is beneficially interested in 19,093,376 shares of LSR, which represents 23.14 per cent of its issued share capital. • The Board of Thalassa will be seeking to engage with the Board of LSR with a view to reviewing and changing LSR’s investment policy approved in July 2013. 10
Appendix 11
WGP Group Ltd Base Data 2016E 2015A Imputed Equity Value $5.0m $5.0m Intercompany Debt $12.0m $16.7m Cash $1.2m $11.6m Imputed Enterprise Value $15.8m $9.8m 12
WGP Group Ltd WGP Group Abbreviated P&L 2016E 2015A Sales $10.5m $18.8m Operating Profit / (Loss) before depreciation (EBITDA) $2.4m $6.2m Operating Profit / (Loss) (EBIT) $1.5m $4.1m Profit before Tax (EBT) $1.1m $3.2m Profit after Tax ( E ) $0.8m $2.6m 13
WGP Group Ltd Imputed Market Value Ratios 2016E 2015A P/Sls 0.48x 0.27x P/EBITDA 2.08x 0.80x P/EBIT 3.29x 1.22x P/EBT 4.51x 1.54x P/E 6.23x 1.96x 14
WGP Group Ltd Imputed EV Ratios 2016E 2015A EV/Sls 1.50x 0.52x EV/EBITDA 6.58x 1.57x EV/EBIT 10.39x 2.40x EV/EBT 14.25x 3.02x EV/E 19.68x 3.84x 15
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