Q1 Financial Presentation 2020 Highlights Group 2 Highlights - - PowerPoint PPT Presentation

DOF ASA – May 27th, 2020

Q1 Financial Presentation 2020

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Highlights Group

DOF ASA – Q1 presentation 2020

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Highlights

EBITDA Q1 MNOK 804

• Average utilisation of 81% for the fleet
• Good and improved performance in all segments
• Tightened markets and high tender activity until end March
• The impacts from COVID-19 and the collapse in oil price have disrupted

the operations and increased the financial risk for the Group

• Vessel values deteriorated high impairments
• Extreme weakening of NOK/BRL high financial costs
• The long-term refinancing solution delayed standstill with secured

lenders and bondholders agreed

• Reduced earnings and utilisation going forward 18 vessels in lay-up in May

DOF ASA – Q1 presentation 2020

Contract status

4 New contracts in Atlantic region

• Skandi Vega (AHTS) awarded a 6-month firm contract with options for

Equinor Energy. Start-up in May

• Skandi Captain (PSV) & Skandi Texel (PSV) awarded 1-year

contracts by the SNSPOOL. Both contracts terminated in April

• Skandi Caledonia (PSV) awarded a 4 wells firm plus options by

Premier Oil UK Ltd. Start up contract postponed until 3Q

• Geosund (Subsea) awarded a 6-month contract for an undisclosed

international customer

• Geosea (Subsea) awarded 5-year firm contract + options with N-Sea

Survey BV

• Skandi Acergy (Subsea) –2-year contract terminated
• Skandi Skansen (Subsea), Skandi Hera (AHTS) & Skandi Iceman

(AHTS) awarded contract incl WROV for the mooring operations of the worlds largest Salmon fish farm on Northern part of Norway. Total duration for all 3 vessels abt. 1 month

Contract status South America region

• Skandi Vitoria (PLSV) awarded a two years contract + options

with TechnipFMC with commencement in January

• Skandi Hav (RSV) & Skandi Botafogo (AHTS) contracts

terminated in April

• All tender discussions with Petrobras postponed

Contract status Asia-Pacific region

• Skandi Singapore (DSV) – secured project contracts over a

period of 50 - 60 days

• Skandi Atlantic (AHTS) & Skandi Emerald (AHTS) –

contracts terminated

Contract coverage: 69% in Q2 and 51% in Q3 Group backlog ~ NOK 4,8 billion in 2020

DOF ASA – Q1 presentation 2020

DOF, a global player

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Vessels & subsea equipment

• Subsea

31

• AHTS

20

• PSV

16

• ROV / AUV

71

19 billion backlog ~3,400 employees 67 vessels

Total of 3,440 employees *

• Subsea

~1,200

• Supply

~2,200

Positioned globally

Main office in Austevoll, Norway  Operating from 6 continents 20 offices near key O&G markets 67 vessels globally

* Headcount as of 31.03.2020

1 1 20 1 1 1 33 1 1 3 5

DOF ASA – Q1 presentation 2020

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DOF Subsea Group at a glance

2005

DOF Subsea established

NOK 1.3bn1)

Revenues Q1’20

1 1792)

Subsea employees worldwide Q1’20

NOK 13.8bn

Firm backlog Q1’20

273)

Subsea vessels

71

ROVs

Modern

State-of-the-art asset base

Integrated

Supplier of subsea

• ffshore services

1) Note: According to management reporting 2) Note: Excluding marine crew. Including 32 contractors hired in from Norskan 3) Note: Including chartered-in vessels Harvey Deep-Sea, Harvey Subsea and Skandi Darwin

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Financial Group

Management Reporting

DOF ASA – Q1 presentation 2020

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Main financial highlights Q1

• Good operational performance in all segments; Q1 Ebitda NOK 804 million

(NOK 541 million)

• Impairments assets in Q1 NOK 1,532 million (NOK 50 million), NOK 1,447

million on vessels & equipment, NOK 85 million on goodwill

• High financial costs due to significant currencies losses and losses on

derivatives of NOK 2,878 million, due to extreme weakening of BRL & NOK versus USD

• Net loss of NOK -4,116 million
• Equity negative of NOK -245 million
• All numbers based on management reporting

DOF ASA – Q1 presentation 2020

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33% 67%

EBITDA Q1 2019

DOF Supply DOF Subsea

Main financial highlights

Operational EBITDA Q1 MNOK 804

• Average utilisation total fleet 81% in Q1
• 94% PSV segment
• 75% AHTS segment
• 78% Subsea segment (project fleet 73%)

Comments to highlights Q1 Performance

• DOF Subsea EBITDA: NOK 491 million
• DOF Supply EBITDA: NOK 313 million

Operations

• Avg. utilisation DOF Subsea fleet: 75%
• Avg. utilisation DOF Supply fleet: 85%
• All PSVs in operation during the quarter
• Stable utilisation AHTS fleet in Brazil and

tightened markets in the North Sea from February towards end of the quarter

• High utilisation from subsea vessels on firm

contracts and improved performance from the regions

• By end-March COVID-19 and the drop in oil

prices impacted the operation negatively

• By end-May 18 vessels were in lay-up
• All numbers based on management reporting
• DOF Supply = DOF Rederi and Norskan consolidated

39% 61%

EBITDA Q1 2020

DOF Supply DOF Subsea

DOF ASA – Q1 presentation 2020

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Profit & Loss Q1 2020

Comments P&L Q1

Operational performance: PSV (94% utilisation)

• Good performance and all vessels on firm
• All vessels in operation

AHTS (75% utilisation)

• Stable earnings and utilisation fleet in Brazil
• Improved earnings in the North Sea until mid-

March Subsea (78% utilisation)

• Improved performance from the regions
• High utilisation vessels on firm contracts

Fx positive impact on the Ebitda Impairments

• Impairments based on updated VIU and FMV
• f the fleet and highly impacted by expected

weaker markets going forward Financial

• High realised and unrealised currency loss due

to historical low levels in NOK and BRL

All figures in NOK million

Q1 2020 Q1 2019 2019 Operating income 2 074 1 678 7 712 Operating expenses

• 1 257
• 1 135
• 4 808

Net profit/loss from TS and JV

• 14
• 3
• 47

Net gain on sale of vessel

• 4

EBITDA before hedge 804 541 2 861 Hedge operating income

• 45
• 188

Operating profit before depr - EBITDA 804 496 2 673 Depreciation

• 307
• 313
• 1 314

Impairment

• 1 532
• 50
• 1 449

Operating profit- EBIT

• 1 035

133

• 90

Financial income 11 22 42 Financial costs

• 335
• 327
• 1 273

Net realised currency gain/loss

• 528
• 107
• 255

Net profit/loss before unrealised currency

• 1 887
• 279
• 1 576

Net unrealised currency loss

• 2 103

77

• 880

Net unrealised gain/loss on market instr.

• 248

84 117 Profit/loss before tax

• 4 237
• 118
• 2 340

Tax 121

• 16
• 542

Net profit/loss

• 4 116
• 133
• 2 881

According to management reporting

DOF ASA – Q1 presentation 2020

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• 1%

25% 74%

EBITDA Q1 2019

5% 29% 66%

EBITDA Q1 2020

Segment reporting Q1 2020

PSV AHTS Subsea Total

Amounts in NOK million

Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Operating income 151 98 401 309 1 523 1 226 2 074 1 633 Operating result before depreciation and impairment (EBITDA) 39

• 6

231 126 534 376 804 496 Depreciation 34 30 74 92 199 190 307 313 Impairment 151 12 481 11 899 28 1 532 50 Operating result (EBIT)

• 147
• 47
• 325

22

• 564

158

• 1 035

133 EBITDA margin 26%

• 6%

58% 41% 35% 31% 39% 30% EBIT margin

• 97%
• 48%
• 81%

7%

• 37%

13%

• 50%

8%

According to management reporting DOF Subsea AHTS PSV

DOF ASA – Q1 presentation 2020

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DOF Subsea Group - Two business segments

DOF Subsea Group Long-term Chartering1)

Revenues Q1’202) NOK 470 million EBITDA Q1'203) NOK 349 million ~74% margin Firm backlog4) NOK 10.5 bn

1) Note: Long-term Chartering comprises 7 PLSVs in operation, plus Skandi Acergy and Skandi Patagonia 2) Note: According to management reporting 3) Note: According to management reporting 4) Note: Firm backlog as at end of Q1'20 5) Includes 32 contractors hired in from Norskan 6) Note: Including 3 chartered-in vessels

9 vessels in

• peration Q1’20

Long-term charters Vessel capabilities Capex spending

Subsea / IMR Projects

Revenues Q1’202) NOK 859 million EBITDA Q1’203) NOK 141 million ~16% margin Firm backlog4) NOK 3.3 bn 1 179 Employees5) Q1’20 18 vessels in

• peration6) Q1’20

Engineering capabilities Framework agreements Opex spending

DOF ASA – Q1 presentation 2020

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0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

• 500

1 000 1 500 2 000 2 500 3 000 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Operating revenue EBITDA EBITDA margin

Historical Performance Group (excl hedge and gain from sale of assets)

Q1 2016 Q1 2017 Q1 2018 Q1 2019 Q1 2020 Operating revenue 2 250 1 723 1 731 1 678 2 074 EBITDA 801 531 519 541 804 EBITDA margin 36% 31% 30% 32% 39% Non-current assets 28 865 29 338 26 101 27 498 24 202 Current assets 4 289 4 675 4 070 3 786 3 477 Total Assets 33 154 34 013 30 171 31 284 27 679 Equity 5 803 7 994 7 491 5 658

• 245

Non-current debt 21 838 22 370 19 133 20 021 9 796 Current debt 5 513 3 649 3 547 5 605 18 127 Total Equity and Debts 33 154 34 013 30 171 31 284 27 678 NIBD 23 319 21 563 19 088 22 051 24 278

MNOK EBITDA margin According to management reporting

DOF ASA – Q1 presentation 2020

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Balance as of 31.03.2020

Comments balance Q1

Non-current assets

• Vessel values impacted by impairment of NOK 1,5 bn
• Goodwill impaired by NOK 85 million, fully written

down Currents Assets/Cash flow

• Operating cash flow NOK 440 million (NOK 43 million)
• Investments NOK -86 million (NOK -902 million)
• Financing activity NOK -127 million (NOK 520 million)
• FX loss on cash/cash equivalents NOK -336 million

NOK 166 million = restricted cash Equity:

• Negative due to weak result in Q1

Liabilities:

• Long-term liabilities represent debt in DOFCON JV

and the BNDES debt

• All other secured debt and all bond loans are

classified as short term due to waiver periods less than 12 months

• Amortisation in Q1 was NOK 357 million
• Debt increased by NOK 2,8 billion due to FX

Amounts in NOK million

31.03.2020 31.12.2019 31.03.2019 ASSETS Tangible assets 23 522 24 303 25 840 Goodwill

• 85

295 Deferred taxes 405 200 997 Investment in associated and joint ventures 32 45 85 Other non-current receivables 243 263 281 Non-current assets 24 202 24 896 27 498 Receivables 1 871 1 761 1 885 Cash and cash equivalents 1 606 1 715 1 901 Current assets 3 477 3 475 3 786 Total assets 27 679 28 371 31 284 EQUITY AND LIABILITIES Subscribted equity 308 3 194 3 164 Retained equity

• 703

87 232 Non-controlling equity 150 170 2 262 Equity

• 245

3 451 5 658 Non-current interest bearing debt 9 657 8 371 19 937 Other non-current liabilities 139 51 84 Non-current liabilities 9 796 8 422 20 021 Current portion of debt 16 504 15 159 4 349 Other current liabilities 1 624 1 339 1 257 Current liabilities 18 127 16 498 5 605 Total equity and liabilities 27 679 28 371 31 284

According to management reporting

DOF ASA – Q1 presentation 2020

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Group key financials

Revenue EBITDA * Firm backlog

NOK million NOK million NOK billion According to management reporting * EBITDA excl. hedge and gain from sale of assets LTV = Last twelve months

• 2,000

4,000 6,000 8,000 10,000 12,000

• 500

1,000 1,500 2,000 2,500 3,000 3,500 4,000

• 5

10 15 20 25 30 35

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Markets & Outlook

DOF ASA – Q1 presentation 2020

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Outlook

Operational

• Covid-19 and a significant fall in oil price will result in a sharp reduction in Operational

Ebitda for the remainder of 2020

• Contract coverage next 12 months of 50%
• The global markets are very challenging in all segments resulting in few contract
• pportunities and pressure on rate levels

Financial

• The Board and Management are working with a long-term financial solution for the Group

to be sufficiently robust for these new events in 2020

Thank you

Presented by Mons Aase

• CEO

Hilde Drønen

• CFO

DOF ASA – Q1 presentation 2020

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DISCLAIMER

This presentation by DOF ASA designed to provide a high-level overview of aspects of the operations of the DOF ASA Group. The material set out in the presentation is current as at 27 May 2020. This presentation contains forward-looking statements relating to operations of the DOF ASA Group that are based on management’s own current expectations, estimates and projections about matters relevant to DOF ASA‘s future financial performance. Words such as “likely”, “aims”, “looking forward”, “potential”, “anticipates”, “expects”, “predicts”, “plans”, “targets”, “believes” and “estimates” and similar expressions are intended to identify forward-looking statements. References in the presentation to assumptions, estimates and outcomes and forward-looking statements about assumptions, estimates and outcomes, which are based on internal business data and external sources, are uncertain given the nature of the industry, business risks, and other factors. Also, they may be affected by internal and external factors that may have a material effect on future business performance and results. No assurance or guarantee is, or should be taken to be, given in relation to the future business performance or results of the DOF ASA Group or the likelihood that the assumptions, estimates or outcomes will be achieved. While management has taken every effort to ensure the accuracy of the material in the presentation, the presentation is provided for information only. DOF ASA , its

• fficers and management exclude and disclaim any liability in respect of anything done in reliance on the presentation.

All forward-looking statements made in this presentation are based on information presently available to management and DOF ASA assumes no obligation to update any forward looking- statements. Nothing in this presentation constitutes investment advice and this presentation shall not constitute an offer to sell or the solicitation of any offer to buy any securities or otherwise engage in any investment activity. You should make your own enquiries and take your own advice (including financial and legal advice) before making an investment in the company's shares or in making a decision to hold or sell your shares.