First quarter results

Transcription

1 First quarter results

2 Our strategic pillars HSE CORE VALUE AND LICENCE TO OPERATE Findings and improvements from Verdal accident Key criteria for being awarded Nyhamna contract MAINTAIN AND DEVELOP HOME MARKETS Several important contract awards: Two jackets, an onshore EPCM contract and a topside Continued high tendering activity INTERNATIONAL EXPANSION Detailed engineering and EPC related services for Hebron GBS Browse TLP tender submitted with partner COOEC HANDS-ON MANAGEMENT Ekofisk jacket and bridge support delivered Strategic and selective approach to prospects 2 Kvaerner 2011

3 Recap from previous quarters STRONG MARKET HIGH TENDERING ACTIVITY CHALLENGING UNCERTAIN PROJECTS 2012 UNCERTAIN 2012 JACKET CAPACITY 3

4 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q1'11 Q2'11 Q3'11 Q4'11 Q1' Key financials Revenues NOK million EBITDA NOK million 500 Net current operating assets NOK million

5 Order intake and backlog Order intake NOK million Order backlog NOK million Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 0 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Upstream Downstream & Industrials For execution in 2012 For execution in 2013 For execution in

6 First quarter operations 6

7 Health, Safety and Environment - keystone in our strive towards operational excellence HSE status: 7 incidents with 9 injuries Verdal accident Pro-active approach to improve Lagging indicators: Lost time incident frequency (LTIF) Per million work hours and 12 months rolling averages 1 0,5 0 Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Total recorded incident frequency (TRIF) Per million work hours and 12 months rolling averages 3,0 2,5 2,0 1,5 1,0 0,5 0,0 Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar 7

8 Operations and market UPSTREAM CONCRETE JACKETS NORTH SEA INTERNATIONAL DOWNSTREAM & INDUSTRIALS E&C AMERICAS Sakhalin-1 project: nearing completion New milestone, Hebron GBS Ekofisk jackets delivered Nordsee Ost: 15 jackets completed Clair Ridge nearing halfway mark Martin Linge and Edvard Grieg projects in engineering Eldfisk topside fabrication started Investment in facilities at Stord Official inaguration of carbon capture test center (TCM) Kashagan Hook-up close down until summer 2012 Browse tender submitted V&M MEP project progressing per acceleration plan FEEDs and studies on going STRONG MARKET IN ALL BUSINESS AREAS. STRATEGIC AND SELECTIVE APPROACH REQUIRED 8 8

9 New contracts in April and May Ormen Lange delivered with Kvaerner as main contractor in EPC contract for Lundin s Edvard Grieg topside of NOK 8 billion. 9

10 High number of EPC prospects North Sea Hejre Edvard Grieg Martin Linge Mariner Bressay Aasta Hansteen Dagny Draupne Victoria Tommeliten Snorre Skrugard Johan Sverdrup Havis Ormen Lange Kollsnes Snøhvit Phase II Nyhamna expansion From the Q3 presentation in November

11 Future NCS topside demand of 37 tonnes per year Topside tonnes delivered historically and forecasted demand Metric tonnes Kvaerner Other Future Future peak NCS topside demand ~45 tonnes per year Future NCS topside demand ~37 tonnes per year High share concrete developments Source: Rystad Energy team research and analysis, Kvaerner data

12 Topside capacity gap on the NCS NCS Demand and current estimated Norwegian yard capacity for greenfield topside construction Annual thousand tonnes ~15 ~30 Demand/ capacity gap Stord Others Total capacity in Norway Average demand

13 Delivery of 20 tonnes of integrated topsides annually from 2014 Studies Concept FEED E Engineering P Procurement C Construction Commissioning In house Subcontracting 13

14 Kvaerner s market position Solid track record in strong home market Preparing for further growth Facing tough global competition 14

15 First quarter financials Eiliv Gjesdal, Chief Financial Officer

16 Income statement Amounts in NOK million Q Q Full year 2011 Operating revenue EBITDA Depreciation and amortisation (15) (12) (54) EBIT Net financial items, including result from associated companies and JVs (2) (1) (116) Profit before tax Income tax expense (50) (130) (344) Net profit EBITDA margin 6.7% 12.5% 8.1% 16

17 Revenue distribution Share of revenues 2010 Percent Share of revenues 2011 Percent Share of revenues last 12 months Percent NOK 13.2 billion North Sea NOK 13.3 billion Jackets NOK 12.1 billion Jackets 17 Important projects in 2010 Sakhalin-1 Gjøa delivered Kollsnes onshore Mongstad Test Centre Kashagan HUC Cameron LNG delivered Longview Gulf LNG Important projects in 2011 Sakhalin-1 Gudrun jacket delivered Clair Ridge jackets Nordsee Ost wind jackets Skarv FPSO delivered Kollsnes onshore delivered Eldfisk Kashagan HUC delivered Longview delivered Gulf LNG delivered Important projects Sakhalin-1 Gudrun and Ekofisk jackets delivered Clair Ridge jackets Nordsee Ost wind jackets Skarv FPSO delivered Kollsnes onshore delivered Eldfisk Kashagan HUC delivered Longview delivered Gulf LNG delivered

18 Increased visibility Order intake NOK million Order backlog NOK million & later Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 * 0 Q4'11 Q1'12 Q1'12* Upstream Downstream & Industrials * Contracts announced from 1 April to 8 May 2012 * Including announced order intake in Q2, but excluding revenues for Q2. 18

19 Q1 2012: Downstream & Industrials review Financials Low activity level for Houston EPC centre until new EPC projects awarded Union Construction around break even level until Longview is concluded Orders Growth in existing contracts Various growth in steel industry services Revenues, EBITDA and EBITDA margin NOK million Order backlog and order intake NOK million EBITDA margin Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 0.4% (86.7)% (7.1)% (1.8)% 0.5% Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Revenues EBITDA Order backlog Order intake 19

20 Q1 2012: Upstream review Financials Activity level reflecting projects in an early phase EBITDA positively affected by release of contingencies Orders Edvard Grieg jacket of NOK 1.1 billion Martin Linge jacket of NOK 1.2 billion Revenues, EBITDA and EBITDA margin NOK million Order backlog and order intake NOK million EBITDA margin Q1'11 Q2'11 Q3'11 Q4'11 Q1' % 15.4% 12.3% 13.2% 10.4% Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Revenues EBITDA Order backlog Order intake 20

21 The current EPC project portfolio Value at award Kashagan HUC USD 1.6B Mongstad TCM NOK 525M Sakhalin-1 USD 600M Ekofisk jacket Undiscl. Nordsee Ost EUR 115M Clair Ridge NOK 1.7B Eldfisk NOK 5.5B V&M Star (MEP) Undiscl. Edvard Grieg jacket NOK 1.1B Martin Linge jacket NOK 1.2B Nyhamna onshore Edvard Grieg topside NOK 6B NOK 8B Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21 North Sea International Jackets Concrete E&C Americas

22 Cash flow and working capital Amounts in NOK million Q Q Full year 2011 Cash flow from operating activities (385) Cash flow from investing activities (39) (42) (231) Cash flow from financing activities 0 4 (1 105) Translation adjustments Net increase/(decrease) in cash and bank deposits (376) 851 (259) Net current operating assets (NCOA) NOK million Q4'10 Q1'11 Q2'11 Q3'11 Q4'11 Q1'11 Downstream & Industrials Kvaerner Group Upstream The EPC business is cash positive through negative working capital: Customer pre-payments¹ of NOK 248 million Downstream & Industrials: Capital tied up in the Longview project ¹ Invoicing in excess of cost and estimated earnings less amounts billed in advanced but not received (on a project by project basis). 22

23 Balance sheet Amounts in NOK million Q Q Full year 2011 Assets Total non-current assets Prepaid company tax Current operating assets Other current assets Total cash and bank Total assets Total equity Non-current interest bearing liabilities Other non-current liabilities Current operating liabilities Current tax liabilities Other current liabilities (0) Total liabilities Total equity and liabilities Equtiy ratio 38 % 24 % 36 % Net cash Access to liquidity totalling NOK 4.1 billion 23

24 Summary and closing remarks 24

25 Number of EPC prospects higher than in decades North Sea Jackets International Concrete E&C Americas Martin Linge Mariner Bressay Aasta Hansteen Dagny Draupne Victoria Tommeliten Snorre Skrugard Johan Sverdrup Havis Ormen Lange Kollsnes Snøhvit Phase II Montrose/Arbroath Dagny Draupne Mariner Bressay Johan Sverdrup Peregrino Jackdaw Nordsee Ost extension Browse Other international prospects on a case by case basis White Rose Hebron GBS EPC-phase Piltun South Petchora LNG Kammennomyskoye Yamal Dolginskoye Amuligak LNG-Liquefaction Gas processing/syngas Chemical/phosphates Heavy oil Refining Steel Pipe manufacturing industry Gas fired power plants Plant maintenance and services Power plant environmental compliance projects Existing and prioritised markets Note: The list is not exhaustive or indicative of Kvaerner s priorities. 25

26 Summary and closing remarks Highlights Substantial increase in order backlog Uncertain 2012 financial results Market opportunities requires selective approach HSE core value and licence to operate Maintain and develop home markets International expansion Hands-on management 26

27 27

28 Copyright and disclaimer Copyright Copyright of all published material including photographs, drawings and images in this document remains vested in Kvaerner and third party contributors as appropriate. Accordingly, neither the whole nor any part of this document shall be reproduced in any form nor used in any manner without express prior permission and applicable acknowledgements. No trademark, copyright or other notice shall be altered or removed from any reproduction. Disclaimer This Presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this Presentation are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for Kværner ASA and Kværner ASA s (including subsidiaries and affiliates) lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as expects, believes, estimates or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for Kvaerner s businesses, oil prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the Presentation. Although Kværner ASA believes that its expectations and the Presentation are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the Presentation. Kværner ASA is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the Presentation, and neither Kværner ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use. 28