Conference. May 21, President and CEO

Transcription

1 UBS Global Oil and Gas Conference May 21, 2013 Rob Saltiel l President and CEO 1

2 Forward Looking Statements Statements contained in this report with respect to the future are forward-looking statements. These statements reflect management s reasonable judgment with respect to future events. Forward-looking statements are subject to numerous risks, uncertainties and assumptions and actual results could differ materially from those anticipated as a result of various factors including: uncertainties related to the level of activity in offshore oil and gas exploration and development; oil and gas prices; competition and market conditions in the contract drilling industry; the risks inherent in the construction of a rig; delays in the commencement of operations of a rig following delivery; our ability to enter into and the terms of future contracts; possible cancelation or suspension of drilling contracts; the availability of qualified personnel; labor relations; operating hazards and risks; terrorism and political and other uncertainties inherent in foreign operations (including risks of war, civil disturbances, seizure or damage to equipment, and exchange and currency fluctuations); the impact of governmental and industry laws and regulations; and environmental matters. These factors and others are described and discussed in our most recently filed annual report on Form 10-K, in our Forms 10-Q for subsequent periods and in our other filings with the Securities and Exchange Commission which are available on the SEC s website at Each forward looking statement speaks only as of the date of this presentation and we undertake no duty to update the content of this presentation or any forward-looking statement contained herein to conform the statement to actual results or to reflect changes in our expectations. 2

3 3 Overview & Strategy

4 Transforming Atwood Oceanics Multi-year investment in fleet modernization and expansion Delivering 5 UDW floater and 3 jackup newbuilds from 2011 through 2015 Will own youngest high-spec floater and jack-up fleets in the industry Industry-leading safety and reliability performance across fleet Top-tier revenue efficiency and cost control leads to: Best-in-class margins Superior shareholder returns Growth is fully funded and sourced predominantly from operating cash flow Current contract backlog of $2.4 billion Maintains substantial financial flexibility 4

5 Steady Revenue and Earnings Growth 2008-Present $ Millions $800 $700 $600 $500 $400 $300 $200 $100 $527 Revenue $651 $787 $253 Q2 $245 Q1 $ Millions $300 $250 $200 $150 $100 $50 $215 Net Income $257 $272 $86 Q2 $73 Q1 $ $ Note: Revenue and Net Income represented on fiscal year basis.

6 Industry Leading Margins and Capital Returns for FY % Net Mar rgins 35% 30% 25% 20% 15% RDC NE ESV RIG ATW SDRL DO 10% 5% 0% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% Capital Return 6 Note: The Bubble size represents the number of rigs operated by each company Note: DO = Diamond Offshore, ESV = Ensco, NE = Noble, RDC = Rowan, RIG = Transocean, SDRL = Seadrill Capital Return = Net Income / (Debt + Shareholders Equity) Source: Bloomberg, FactSet Dated May 15, 2013

7 Shareholder Return: ATW Vs. Peers* 35% 30% 25% 20% Total Shareholder Return: 1 Year Comparison 31.7% 24.2% 19.9% 20.5% 20.5% 31.5% 150% 130% 110% 90% 70% Total Shareholder Return: 3 Year Comparison 70.8% 66.9% 129.7% 15% 10% 5% 0% 12.7% ATW RDC DO NE SDRL RIG ESV 50% 30% 10% -10% -30% 34.6% 14.4% 21.6% -11.8% ATW RIG DO NE RDC ESV SDRL 800% 700% 600% 500% Total Shareholder Return: 10 Year Comparison 699.8% 487.2% 4000% 3500% 3000% 2500% Total Shareholder Return: 20 Year Comparison % 400% 2000% 300% 200% 100% 82.4% 161.2% 165.2% 167.5% 1500% 1000% 500% % 258.3% 0% ATW RDC ESV NE RIG DO 0% ATW NE RDC 7 *As of May 14, 2013 Source: FactSet

8 Expanding our High Specification Rig Fleet Fleet Additions 5 Ultra-Deepwater Floaters 3 High-Spec Jackups $3 8 Billion Investment $3.8 Atwood Mako Atwood Manta Atwood Orca Atwood Osprey Atwood Condor Atwood Advantage 2013 CALENDAR YEAR 8 Atwood Achiever Atwood Admiral

9 Improving Revenue Quality 2011 vs FY 2011 Revenue 10% FY 2015 Revenue* 10% 27% 53% 20% 80% Ultra Deepwater Floaters High Spec Jackups Other 9 *Source: Atwood internal analysis (pro forma estimate for FY 2015) Ultra Deepwater Floaters High Spec Jackups Other

10 Fleet Transformation and Growth Atwood s fleet has a strong presence in Australia, Southeast Asia and West Africa ATWOOD BEACON ATWOOD ADVANTAGE ATWOOD ACHIEVER Houston, Texas ATWOOD AURORA ATWOOD HUNTER VICKSBURG ATWOOD ADMIRAL ATWOOD MAKO ATWOOD MANTA ATWOOD CONDOR ATWOOD ORCA ATWOOD FALCON ATWOOD OSPREY ATWOOD EAGLE Headquarters UDW / DW Semisubmersibles Jack-ups Newbuild Drillships 10

11 11 Execution Performance

12 Achieving Top-Tier Execution Key Enablers - Centralized maintenance and technical support Consistent standards - Atwood Osprey and trouble-shooting Common equipment - Atwood Mako across rigs and - Atwood Condor supplier consolidation Organic growth with - Atwood Manta proven rig designs - Atwood Orca and world-class 2014 shipyards - Atwood - Early capital project Advantage scoping and detailed - Atwood Achiever project planning Experienced project - Atwood Admiral management teams Value Drivers Revenue Cost Project Efficiency Control Management Best-in-class Operating and Net Margins Consistent, Superior Shareholder Returns 12

13 Continuous Safety Performance Improvement Fiscal Year 2008-Present Total Recordable Incident Rate Lost Time Incident Rate Atwood Oceanics recognized as leading offshore driller for HSE in 2012* 13 *Results from EnergyPoint Research customer satisfaction survey published February 20, 2013

14 Major Accomplishments Last Nine Months Partial Listing Delivered Atwood Mako 4 weeks ahead of schedule and started up in the Gulf of Thailand Delivered Atwood Condor ahead of original schedule and started up in the Gulf of Mexico Announced FY2012 record revenue and earnings and best safety ft year in Atwood s 44-year history Sept 2012 Oct 2012 Nov 2012 Delivered Atwood Manta 3 weeks ahead of schedule and started up in the Gulf of Thailand Contracted Atwood Orca to initial 2-year contract in Thailand Dec 2012 Jan 2013 Announced d1q FY2013 results with 95% revenue Jan 2013 efficiency Delivered Atwood Orca 10 weeks ahead of schedule April Announced 2Q FY2013 results with record quarterly revenue May 2013

15 Calendar 2013 Priorities and Potential Catalysts Start-up of the Atwood Orca Contracting of Atwood Beacon and Atwood Hunter (2013 / 2014 availability) Securing inaugural contract for the Atwood Achiever Potential exercise of option for 4th A AClass drillship Delivery and start-up of the Atwood Advantage Extensions/contracting of rigs with availability 15

16 16 Market Outlook and Contracts

17 64 Recent Discoveries in Floater Water Depths* December 2011 to April Golden G Triangle * Water depths greater than 500 ft. 17 Source: IHS-Petrodata 8

18 Steady Floater Utilization UDW Rigs Sold Out 290 Total Supply Total Supply 100% 98% 96% 94% 92% 90% 88% 86% 84% 82% 80% Contracted Uttilization % 98% 96% 94% 92% 90% 88% 86% 84% 82% 80% Contracted d Utilization Worldwide Floater Supply and Utilization Total Contracted Utilization UDW Floater Supply and Utilization Total S Supply Total Supply Total Contracted Utilization Source: IHS-Petrodata 18 Note: Contracted Utilization equals Working Rigs / Total Supply

19 New Build UDW Floater Delivery by Calendar Years No. of Rigs Contracted Uncontracted Total 92 Contracted 63 Uncontracted Source: IHS Petrodata as of May 1, 2013

20 Jackups: Utilization Recovers Even as Supply Grows Worldwide Jackup Supply and Utilization Total Supply 100% % % % % % % % Total Supply Total Contracted Utilization High Spec Contracted Utilization Source: IHS-Petrodata Note: Contracted Utilization equals Working Rigs / Total Supply 20 Utilization

21 Accelerating High Spec Jack-Up Dayrate Outlook Jackup tenders up approximately 20% over the past 4 months Driven by demand in the North Sea, Middle East, SE Asia and India Contract duration and lead times steadily increasing Currently at 390 and 160 days, respectively Up 100% and 50%, respectively since 2007 Market outlook for 2013 remains favorable Overall contracted utilization rates for high spec rigs exceeds 94% Dayrates currently in the $160, to $190, range, depending on the geographic region and contract term Many older rigs are not likely to return to market 30 jack-up rigs permanently removed from the fleet since 2011; compared to aggregate of 22 rigs for the previous 15 years ending 2010 Jack-up demand continues to shift toward newer, high-specification rigs 21 Source IHS, ISI Group, Pareto Securities

22 Atwood Fleet Contract Status (by calendar year) Rig Class/Rig Customer Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Ultra-Deepwater Drillships Atwood Advantage Noble Energy $409K $584K Atwood Achiever Available Delivery mid-2014 Atwood Admiral Available Delivery early 2015 Ultra-Deepwater Semisubs Atwood Osprey Chevron $490K $470K Atwood Condor Hess / Shell $514K Deepwater Semisubs Atwood Eagle Woodside / BHP / Apache $436K / $385K Atwood Falcon Apache $385K Atwood Hunter Noble Energy $435K Jack-Ups Atwood Aurora Bowleven / Glencore / Addax $134K $155K $164 Atwood Beacon Shemen Oil $151K Vicksburg CEC International $105 $115K Atwood Mako Salamander $145K $155K Atwood Manta CEC International $145K Atwood Orca Mubadala Petroleum $160K 22 Contracted (current) Contracted (follow on work) Shipyard Mobilization (as of 5/14/13) Firm Rig Years 17.6 Firm Revenue $ Billions 2.4

23 Revenue Backlog Analysis (FY in $Millions) Total = $2.4 Billion $1,200 (in Millions) $1,000 $353 $800 $965 $886 $600 $400 $1,129 $461 $411 $200 $531 $ Fiscal Year Majors Large Independents Small Independents d 23 (as of 5/14/13)

24 24 Financial Considerations

25 Future Capital Expenditures Fully Financed $1.5 billion 1 in remaining total capital expenditures as of May 1, 2013 Approximately $0.9 billion in contracted after tax cash flow through 2015 is available to fund these expenditures With the exercise of the $550 million Credit Facility accordion, we are fully funded for all construction costs Credit metrics peak in mid with the delivery of the Atwood Achiever ($ millions) 1, Debt-to-cap to and debt to 0 EBITDA ratios are maintained below 40% and 2.7 times, respectively CAPEX Uncontracted Cash Flow Fiscal Year Contracted Cashflow Debt Includes $245 million of maintenance and other CAPEX and capital spares for 2013, 2014 and CAPEX for 2013 represents projections for remaining 5 months for fiscal Represents approximately ½ of uncontracted cash flow to meet CAPEX requirements

26 Earnings Growth Through Newbuild Rig Deliveries Potential ti Incremental $6.25 Earnings Per Share from Newbuild Rig Deliveries* i Atwood Condor Atwood Mako Atwood Manta Atwood Orca Atwood Manta Atwood Orca Atwood Advantage Atwood Achiever Atwood Achiever Atwood Admiral Atwood Admiral $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 FY 2013 FY 2014 FY 2015 FY 2016 High-Spec Jack Ups Ultra-Deepwater Floaters Assumptions: UDW Floaters Dayrate of $575,000, operating cost of $190,000 (inflation-adjusted), revenue efficiency of 95% and a tax rate of 13% High Specifications Jack-ups Dayrate of $155,000,operating costs of $71,000 (inflation-adjusted), revenue efficiency of 95% and a tax rate of 13% 26 * Comparison versus FY2012 earnings; EPS analysis excludes any increases in Operating or SG&A costs or interest expense during the 4 year period

27 27 Summary

28 The Atwood Advantage High-Quality Operating Fleet with Aggressive Growth Initiative Knowledgeable and Experienced Management Team Attractive Geographic Diversity Strong Backlog with High Quality Customers Significant Liquidity and Financial Flexibility Industry-Leading Margins and Shareholder Returns 28 History and Reputation of Safe and Efficient Operations

29 Thank You