Q3 trading update. 30 October 2017

Transcription

1 Q3 trading update October 2017

2 Business highlights Q Signs of a stabilising oil and gas environment Revenue and results in building & infrastructure market segment increased; other markets like renewables offer good potential Lower revenue and EBIT than anticipated caused by technical down time of some vessels leading to project delays, and the impact of hurricanes in the Americas Implementation of measures to restore results on track Agreement reached to divest non-core trenching and cable-laying business important step in aligning portfolio with Building on Strength strategy accretive to results 2 Trading update Q3 2017

3 Financial highlights Q Y-o-y revenue decline of 19.5% on currency comparable basis, to large extent driven by lack of activity at Seabed Geosolutions Low single digit EBIT margin compared to mid-single digit in Q Cash flow from operating activities after investments slightly positive Working capital at 12.9% of revenue compared to 15.1% in Q Net debt/ebitda of 2.9 within covenant requirement to not exceed 3.0; expected to improve in Q Launch of subordinated convertible bond; pro forma net debt/ebitda of 1.8 including assumed proceeds of EUR 100 million 3 Trading update Q3 2017

4 Subordinated convertible bond offering - launched this morning Proceeds will be offered to holders United States Private Placement notes for early repayment Additional headroom under financial covenants as related bond and interest costs will be excluded from covenant ratios Increased financial flexibility, reduced interest and extension of debt maturity profile Key indicative terms Issue size Offering Maturity EUR 100 million Subordinated unsecured convertible bonds October 2024 (7 years); bond holder early redemption option on 5th anniversary Issue/redemption price 100% / 100% Coupon Conversion premium 4.0% to 4.5% coupon per annum 40.0% 50.0% over VWAP 4 Trading update Q3 2017

5 Cost reduction & performance improvement on track Significant improvement in charter terms and conditions of 2 IRM vessels, one of which has been completed in Q3 and the other is expected to be completed shortly Winding down of the 2 remaining long term construction and installation charters in Q4 Retirement of 2 old owned vessels from the fleet in Q4 Divestment of cable-laying and trenching business Down-manning of vessels through standardisation and application of new technologies FTE reduction and more flexible staffing to deal with seasonality Further streamlining of organisation by standardising work processes, reducing number of legal entities and consolidation of support functions into shared service centers These measures are expected to result in annualised contribution to EBITDA of EUR million during coming quarters. 5 Trading update Q3 2017

6 Revenue decline driven to large extent by lack of activity at Seabed excl. exceptional items X EUR million Q Marine Land Geoscience Non-operating Q Marine Land Geoscience Non-operating Trading update Q3 2017

7 12 month backlog decreasing rate of decline 1, , ,342 1, %* , ,065 1, , Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Marine Land Geoscience * Corrected for currency effect and for portfolio changes related to marine construction & installation activities 7 Trading update Q3 2017

8 12 month backlog bottoming out offshore oil and gas market Growth of early cycle marine site characterisation backlog, indicating bottoming out of offshore oil and gas market (x EUR million) 12 month backlog Comparable growth* 3Q16 2Q17 3Q17 Y-on-Y Site characterisation Marine % Asset integrity Marine (10.2%) Marine (3.0%) Site characterisation Land (15.3%) Asset integrity Land (17.5%) Land (15.8%) Geoscience (Seabed) % Total 1, (5.6%) % definite orders 64% 70% 67% * Corrected for currency effect and for portfolio changes related to marine construction & installation activities 8 Trading update Q3 2017

9 Outlook 2017 Signs of stabilising oil & gas environment Continued growth in building & infrastructure and renewables markets FY revenue: double-digit decline, with single digit decrease in Q4 EBIT margin* expected to improve during H2 compared H1, resulting in FY negative low-single digit margin FY cash flow: negative mainly as result of later than anticipated start of Seabed Geosolutions project, pushing related cash collection into early 2018 FY capex of around EUR 100 million * Excluding exceptional items 9 Trading update Q3 2017

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