M agseis ASA EAGE 2017 13 June 2017 AGENDA Introduction OBS - - PowerPoint PPT Presentation

▶
m agseis asa eage 2017
SMART_READER_LITE
LIVE PREVIEW

M agseis ASA EAGE 2017 13 June 2017 AGENDA Introduction OBS - - PowerPoint PPT Presentation

Sep 11, 2023 15 likes •258 views

M agseis ASA EAGE 2017 13 June 2017 AGENDA Introduction OBS market development Current M agseis operations Financials and outlook Appendix June 2017 2 This is M agseis Leading provider of Ocean Bottom Seismic technology and

slide-1
SLIDE 1

M agseis ASA EAGE 2017

13 June 2017
slide-2
SLIDE 2

AGENDA

June 2017 2

OBS market development Current M agseis operations Financials and outlook

Appendix

Introduction

slide-3
SLIDE 3

This is M agseis

3
  • Leading provider of Ocean Bottom
Seismic technology and services
  • M ainly production – IOR segment
  • Located in Oslo, Bergen, Stockholm,
Singapore and Brazil
  • 100+ employees
  • Listed on Oslo Axess
  • M arket capitalisation of USD ~110m
June 2017
slide-4
SLIDE 4

OBS provides superior image quality

  • Gaining share from streamer seismic

Streamer Seismic Ocean Bottom Seismic (OBS)

80%

M arket share

20%

M arket share

4 Source: M agseis/ Statoil June 2017
slide-5
SLIDE 5

Providing true “3-D” illumination of reservoirs

5 Data quality 1960s ~1990 2005-10 Today Source: M agseis

Exploration Field Development and IOR

Narrow Azimuth M ulti Azimuth Wide Azimuth Full Azimuth

3D streamer 3D streamer OBS

OBS Streamer

June 2017
slide-6
SLIDE 6

Reduced cost will broaden application scope

Marlim Leste Roncador Parque das Baleia Valhall Eldfisk Thunder Horse Nowruz Albacora Lobster Parque das Conchas Grane Balder/Ringhorne/Jotun Andrew Champion Marlin Edvard Grieg Golden Eagle Area Development Dan Agbami-Ekoli Bonga Shearwater Torpille Marine Arne South Beryl Stones Jack/St Malo Nene Marine Bokor Buzzard Heidrun Ceiba Alwyn North Knarr Kristin Ravva Norne Captain Valemon Visund Clair Sepinggan Kvitebjorn BBLT Foinaven Akpo Salsa Bahar Shah-Deniz Cleeton Daman Offshore Dalia Snohvit Sole West 1 2 3 4 5 6 1 10 100 1000 Historical OBS surveys No observed OBS survey Source: M agseis/ Rystad Energy

COM PLEXITY

Reduced costs and maturity of technology 6 FIELD SIZE (mmboe) IM AGE QUALITY

Increased cost competitiveness...

M apping of currently producing fields or subprojects on producing fields

... will increase number of addressable fields

June 2017 2D PRICE PER KM 2 High density/ WAZ 3D OBS 3D
slide-7
SLIDE 7

Supporting a strong market outlook

2020 2019 2018 2017 2005 2016 2 250 2 000 1 575 1 500 1 250 1 000 750 500 250 Source: M agseis/ Arkwright/ Rystad Energy/ Statoil 7

USD >750 m

$ MILLION

OBS market drivers

IOR Focus Increasing geological complexity Technology development Customer confidence & adoption June 2017
slide-8
SLIDE 8

M arine Autonomous Seismic System

M iniaturised node sensors Handling system Applications

ROV deployment Ultra deep water deployment Cable deployment 8 Source: M agseis June 2017
slide-9
SLIDE 9

Larger spread driving substantial cost reductions

100K

$ per.km²

25K

$

per.km²

2014 75km 2015 150km 2016 350km 2018 >600km

Cable length Large spreads - rolling operations M ultiple patch deployment 9 Source: M agseis June 2017
slide-10
SLIDE 10 Source: M agseis

Aramco Red Sea project

10

Operational highlights

  • Efficient transition from phase 1 of S-78 to

Extension (rolling cables from one survey to the next)

  • Planned yard stay and delays caused by sandstorm meant

that source acquisition could only commence on April 28th

  • Very similar survey conditions with water depths varying form

approximately 1,000m to transition zone and in some cases over dry land (islands) on the same receiver line.

  • Crew and nodes shows an excellent performance despite the challenging environment.
  • The robust M agseis “ node in a cable” solution proving it’s suitability on the rugged seabed.
  • Production in line with project plan
June 2017
slide-11
SLIDE 11

Aramco Red Sea project

Scale: v/ h=1

11
slide-12
SLIDE 12

ConocoPhillips North Sea project

M ASS modular solution 12 Source: M agseis

Contract highlights

  • 4D, full-azimuth survey over

the Eldfisk field

  • ROV and source vessels operated by

ConocoPhillips

  • M agseis provides crew,

nodes and handling

  • Potential for repeat work

High capacity, mobile ROV

  • peration
  • Unlimited capacity of nodes
  • M odular handling system
  • Very strong interest from clients
  • Smart operations
June 2017
slide-13
SLIDE 13

Established as a leading OBS provider

Solid customer base Proven track record Ongoing projects

  • Completed >1,300 sq.km2
  • M ore than 140,000

nodes deployed

  • Excellent reputation for

high quality data

  • Strong QHSE culture
  • Saudi Aramco’s S-78

Extension project in the Red Sea

  • 4D survey ongoing for

ConocoPhillips in North Sea

13 Source: M agseis June 2017
slide-14
SLIDE 14

Crew #3 preparations ongoing

Source: M agseis 14
  • Vessel tender process in final stages of negotiation
  • Highly efficient platforms available at attractive terms
  • Significant component of vessel owner funding ensures that M agseis growth plan is fully financed
  • Commitments for up to 6,000 M ASS sensors and associated handling systems being prepared
  • Long-lead items are being ordered
  • Target start of operations by April 1st, 2018
  • Already bidding on projects
June 2017
slide-15
SLIDE 15

New, exclusive source technology agreement

  • Significant potential to reduce costs further
  • Improved efficiency and data quality by new Source Isolation technology
  • Improved source efficiency though simultaneous shooting by one source vessel
  • Improved shot sampling over conventional technologies
  • Exclusive agreement for OBS
  • Commercially available in 2018
15 Source Isolation Conventional shooting 25m 50m Source: M agseis June 2017
slide-16
SLIDE 16 KEY F Y FIGURES Q1

Q1 2017

17 Source: M agseis

21.1

REVENUE

8.3

EBITDA

3.5

NET INCOME

54.2

CASH BALANCE

$ MILLION $ MILLION $ MILLION $ MILLION $ MILLION

21.1 18.1 8.3

REVENUE

Q1 2017

REVENUE

Q1 2016

EBITDA

Q1 2016

EBITDA

Q1 2017

1.6

16 June 2017
slide-17
SLIDE 17

First quarter 2017 results

  • Key figures
  • Solid underlying operational performance during
Q1 (EBITDA of USD 8.3m)
  • USD 1.3m in capitalised mobilisation costs amortised in
Cost of Sales
  • USD 1.0m in late start compensation included in
Cost of Sales
  • Cost of Sales for Q1 2016 included fuel and source vessel costs
  • Closing cash position of USD 54.2m
and robust Equity ratio of 71.2%
  • Strong cash flow from operations during Q1
  • Cash flow from operations USD 10.1m
  • Reiterating full-year guidance
  • Expected EBITDA for 2017 of > USD 20 million
17 Source: M agseis Profit and loss Q1 2017 Q1 2016 Year End 2016 Revenue 21 076 18 115 58 905 Cost of sales 9 997 13 630 39 038 EBITDA 8 329 1 559 8 506 EBIT 4 762
  • 2 487
  • 11 114
Net profit/ loss 3 511
  • 3 942
  • 16 695
Basic earnings per share 0.06
  • 0.13
  • 0.44
Financial position Cash 54 195 15 218 18 974 Working Capital1) 6 173 537 4 812 Total equity 91 134 49 826 49 045 Equity ratio 71.2% 65.7% 56.6% Gross interest bearing debt 12 460 7 027 16 263 Cash flow Net cash from operating activities 10 074 1 533
  • 2 117
Net cash from investing activities
  • 9 449
  • 2 316
  • 16 463
Net cash from financing activities 34 596 4 565 26 120 1): Working Capital defined as Trade Receivables less Trade Payables June 2017
slide-18
SLIDE 18

Attractive economics for new, high capacity vessel

18

2x higher efficiency through longer cable and more nodes Substantial EBITDA contribution from new investments

150km 400km Sensors # of days Efficiency 3,000 130 1.0 8,000 65 2.0 Cable length Current crew Cable vessel #2 Current crew CAPEX EBITDA contribution1 Cable vessel #2

70 30 45 >30

1) Based on 2017 EBITDA guidance for current crew less 2016 SG&A ROV crew

15 10

June 2017
slide-19
SLIDE 19

Long term growth strategy

19

Business model Key goal By 2020

  • Reduce OBS acquisition

costs by >50%

  • Increasng the attractiveness
  • f OBS by moving towards a

cost of $25K/ km²

  • Operate large equipment

spreads

  • Share pool of nodes across

platforms

  • Build a flexible opex base
  • Node pool of >30,000

nodes

  • 2-3 high capacity cable

vessels

  • 2-3 modular ROV/ Node

Deployer systems

25K

$

per.km²

Developing M agseis into the definitive market leader in OBS market

June 2017
slide-20
SLIDE 20

Summary and outlook

Strong operational and financial performance Awarded extension In Red Sea Pursuing substantial shooting efficiency improvements Growth projects well underway 20
  • Raised USD 40 million new equity to finance growth plans
  • ConocoPhillips 4D ROV project ongoing
  • Vessel tender process for Crew #3 in final stages and long-lead items on order
  • Strong financial performance, Revenue of USD 21.1m and EBITDA of USD 8.3m
  • First phase of S-78 Red Sea survey completed on time
  • Exclusive license agreement for Source Isolation technology applied to OBS
  • Implementation of technology targeting 30-50% acquisition cost reduction
  • Awarded Extension to S-78 project by BGP and Saudi Aramco
  • Expected duration of more than six months
June 2017
slide-21
SLIDE 21 2020 2019 2018 2017 2005 2016 2 250 2 000 1 575 1 500 1 250 1 000 750 500 250

Larger spread driving cost reductions Excellent operational performance Strong financial results Strong market outlook

100K

$

per.km² per.km² 2014 75km 2015 150km 2016 350km 2018 >600km Cable length

25K

$

21 June 2017
slide-22
SLIDE 22

First quarter 2017 results

  • Comprehensive income
  • Revenue
  • USD 21.1m, strong performance on the Aramco S-78 project
  • Cost of sales
  • Full quarter of production
  • Amortisation of capitalised mobilisation cost USD 1.3m
  • Late start compensation of USD 1.0m
  • Lower Cost of Sales due to fuel provided on survey
(Q1 2016 also included source vessel costs)
  • Research and development
  • Capitalised USD 0.1m related to deep Water R&D project and
development of M ASS III
  • Depreciation
  • Amortisation of capitalised mobilisation cost USD 0.4m
  • Amortisation and Impairment
  • USD 0.2m related to damaged equipment during Red Sea Survey
  • Finance
  • Primarily interest related to BGP pre-funding, GIEK and
Innovation Norway
  • Tax
  • USD 0.8m for withholding tax in Saudi Arabia
In USD thousands Q1 2017 (unaudited) Q1 2016 (unaudited) 2016 (audited) 22 Revenue 21 076 18 115 58 905 Cost of sales 9 997 13 630 39 282 Research and development 499 492 2 022 SG&A and other expenses 2 250 2 435 9 339 EBITDA 8 329 1 559 8 262 Depreciation 3 219 2 991 10 769 Amortisation 116 1 010 1 409 Impairment 233 46 7 441 EBIT 4 762
  • 2 487
  • 11 357
Net interest and fx (gain)/ loss 462 478 1 386 Other finance cost 7 7 Net finance costs 462 485 1 393 EBT 4 299
  • 2 972
  • 12 750
Tax 789 970 4 218 Net income 3 511
  • 3 942
  • 16 968
Currency translation differences Total comprehensive income 3 511
  • 3 942
  • 16 968
Source: M agseis June 2017
slide-23
SLIDE 23

First quarter 2017 results

  • Balance sheet
  • Trade receivables primarily Aramco
  • Feb and M ar production (paid in Q2)
  • Other current assets:
  • Primarily capitalised mobilisation costs
  • Equity ratio of 71.2%
  • Debt covenants at 30%
  • Non-current liabilities
  • Senior debt drawn down from Export Credit Norway and
Innovation Norway: USD 6.9m
  • Shell Deep Water R&D funding: USD 6.8m (contingent liability)
  • Current tax liabilities
– Withholding tax and corporate tax Saudi Arabia – Corporate tax in Singapore and M alaysia
  • Other current liabilities
– Short-term debt BGP USD 2.1m – Current portion of long-term debt USD 2.9m – Accruals for vessel operational costs USD 7.4m In USD thousands Q1 2017 (unaudited) YE 2016 (audited) 23 Equipment and other intangibles 54 111 49 314 M ulti-client library Cash and cash equivalents 54 195 15 218 Trade receivables 12 602 8 027 Stock (fuel and batteries) 1 003 582 Other current assets 6 156 2 711 TOTAL ASSETS 128 067 75 852 Share capital 657 254 Share premium 140 741 90 945 Retained earnings and other reserves
  • 50 264
  • 41 374
TOTAL EQUITY 91 134 49 826 Obligation under finance lease 704 1 668 Other non-current financial liabilities 14 063 9 523 TOTAL NON-CURRENT LIABILITIES 14 767 11 191 Trade payables 6 429 7 913 Current tax liability 2 875 330 Other current liabilities 12 862 6 592 TOTAL CURRENT LIABILITIES 22 166 14 835 TOTAL LIABILITIES 36 933 26 026 TOTAL EQUITY AND LIABILITIES 128 067 75 852 Source: M agseis June 2017
slide-24
SLIDE 24

First quarter 2017 results

  • Cash flow
24
  • Cash flow from operations
  • Variance from EBITDA resulting from:
  • Non-cash costs in OPEX (amortised transit costs & provisions)
  • Less 10% withheld by Aramco
  • Cash from investments
  • Relates mainly to investments for the ROV crew
  • Cash flow from financing
  • Cash from equity raise of net USD 38.5m
  • Instalments of USD 3.8m
  • Financing from Shell under Deepwater R&D agreement of USD 0.4m
Earnings before tax 4 299
  • 2 972
  • 12 750
Depr, Amor,Impair,Finance, etc. 4 178 4 258 19 836 Net working capital adjustments 1 597 247
  • 9 204
Net cash flow from operating activities 10 074 1 533
  • 2 117
Net cash flow from investing activities
  • 9 449
  • 2 316
  • 16 463
Net cash flow from financing activities 34 596 4 565 26 120 Net change in cash and cash equivalents 35 221 3 783 7 539 Cash balance at the beginning of the period 18 974 11 435 Cash balance at period end 54 195 15 218 7 539 In USD thousands Q1 2017 (unaudited) Q1 2016 (unaudited) 2016 (audited) Source: M agseis June 2017