Investor Presentation March 2018

Transcription

1 Investor Presentation March 2018

2 INTRODUCTION TO ADES

3 ADES at a Glance Who We Are Leading MENAbased O&G Service Provider A leading oil & gas drilling and production services provider in the Middle East and North Africa Focused on creating value for E&P players in the region Constantly evolving portfolio of services that primarily includes offshore and onshore contract drilling, workover and production services Differentiated Low- Cost Business Model ADES specialises in acquiring and refurbishing legacy fit for purpose offshore assets which (among other cost-saving measures) enable the Group to offer competitive rates to its clients Backed by a capable in-house refurbishment and maintenance team, the Group benefits from a highlyskilled, low-cost, largely Egyptian workforce Customer-Centric Approach The Group s business revolves around providing tailored solutions and superior service to its clients ADES offering is characterized by its commitment to global industry standards and ever-expanding services and solutions 3

4 ADES Primary Risk Management Strategy Focus on Low Cost of Production Areas Such as MENA Activity remains higher due to lower break-even prices in the MENA region than the global average Focus on Workover Drilling & Maintenance Focus on workover drilling and maintenance, mainly constituting OPEX expenditure, which is typically less cyclical than CAPEX expenditure Considered Approach to Acquisitions ADES mainly assesses its potential acquisitions through two methods: Buy-to-Contract Model Securing the contract first, then finalising the acquisition of the asset Contract Acquisition Model Acquiring chartered assets with on-going contracts Backlog Management Target backlog of 2x net debt ensuring maintenance of a minimum level of liquidity to pay its contractual obligations at all times 4

5 Corporate Strategy Evolution Denotes number of Chartered Rigs Early formation Offshore penetration Perfected business model of securing legacy assets and operating with low cost structure 16x Revenue Growth Ramped up asset base, expanded geographically Scale up operations and expand geographically USD158 MN USD10 MN Onshore Drilling & Workover Jack-up Barge ROV Offshore Drilling & Workover Projects Denotes continuing services MOPU Denotes discontinued services 5

6 OTHER MENA Services & Footprint What We Do 12% 16% 6% 3% 64% Drilling & Workover Offshore & onshore drilling & workover services leased at operating day rates MOPU Mobile offshore platform equipped with production and process facilities and FSO Jack-up Barge & Projects Offshore jack-up barge used to provide offshore support services to GUPCO Other Services Accommodation, catering and equipment rental to its offshore rig clients Onshore Offshore Revenue Contribution (2017) Where We Operate Pre-selected markets with natural barriers to entry with a focus on low-risk, nonharsh shallow water environments Algeria Egypt KSA Revenue by Country 2017 Services Drilling & Workover Assets 2 Onshore Rigs Services Drilling & Workover MOPU Jack-Up Barge & Projects Other Services Assets 7 Offshore Rigs 1 MOPU Services Drilling & Workover Other Services Assets 6 Offshore Rigs KSA 34% Algeria 14% Egypt 52% Pre-qualifications Egypt India Algeria Mexico Iraq Ghana UAE Gulf of New Guinea Kuwait KSA Bahrain 6

7 FULL-YEAR RESULTS 2017 REVIEW

8 Full-Year Results 2017 Key Highlights Revenue USD 158 MN 18% YoY 2017 Financial Highlights Adjusted EBITDA (2) USD 80 MN 51% EBITDA margin 11% YoY Normalised Net Profit (3) USD 50 MN 31% Net Profit Margin 31% YoY Backlog USD 427 MN 5.7x Net Debt Net Debt USD 76 MN 3.8x Interest Coverage 67% YoY Equity USD 318 MN 203% YoY Operational Highlights New contract awards and renewals Securing new financing options Finalized exclusive marketing agreements with leading shipyards workforce >1,372 Recruiting the highest calibers RIFR (1) 0.41 Continued exemplary safety performance Scaling existing operations and penetrating new markets Note (1): RIFR refers to Recordable Injury Frequency Rate since inception; Note (2): Adjusted EBITDA - Operating profit for the year before depreciation and amortisation, employee benefit provision and other provisions and impairment of assets under construction under construction; Note (3): Normalised Net Profit Net Profit for the year before the one-time IPO expense of USD 5.1 million during FY

9 Full-Year Income Results Statement 2017 Highlights Income Statement Highlights Revenue USD MN Adjusted EBITDA (1) USD MN Normalised Net Profit (2) USD MN CAGR % CAGR % CAGR % YoY Growth FY16-FY % YoY Growth FY16-FY % YoY Growth FY16-FY % Note (1): Adjusted EBITDA - Operating profit for the year before depreciation and amortisation, employee benefit provision and other provisions and impairment of assets under construction Note (2): Normalised Net Profit Net Profit for the year before the one-time IPO expense of USD 5.1 million during FY

10 Full-Year Results 2017 Revenue & Backlog Revenue Breakdown Evolution Revenue growth was driven by the following: Increasing Geographic Diversification The November 2016 deployment of three offshore rigs in the KSA The realization of the full-year impact of our MOPU operations in Egypt The October 2016 launch of operations of ADES 3 in Algeria 10% 9% FY % 34% 14% FY % Egypt Algeria KSA Backlog Breakdown Evolution (1) Total backlog as at 31 December 2017 stood at USD 427 million compared to USD 501 million as at 31 December 2016 Backlog by Country The PSA between ADES and Nabors Drilling in December 2017 for the acquisition of three operating offshore jack-up rigs in the KSA (see slide 20) is expected to further strengthen and diversify our backlog. Once closed, it will add to our revenue 48% Dec 16 44% 41% Dec 17 54% Egypt Algeria KSA and earnings, with revenues to be marginally weighted towards 2H % 6% Note (1): As at year-end; Note (2): Calculated as a percentage of revenue before discounts 10

11 APPENDIX

12 Income Statement USD ( 000) YoY Growth ('16-'17) Revenue 134, ,590 18% Cost of Revenue (1) (44,976) (57,897) Gross Profit 89,140 99,693 12% Margin 66.5% 63.3% G&A (2) (14,550) (18,795) Adjusted EBITDA (3) 74,589 80,897 8% Margin 55.6% 51.3% Depreciation (18,460) (20,664) EBIT 56,130 60,234 7% Margin 41.9% 38.2% Interest (9,428) (16,550) FX Gain / (Loss) - - Credit Interest - 7,016 Other (4) (5,404) (7,293) EBT 41,297 43,406 5% Margin 30.8% 27.5% Investment Income - - Taxes (3,284) 1,168 Net Profit 38,013 44,574 17% Margin 28.3% 28.3% Normalised Net Profit (5) 38,013 49,637 31% Margin 28.3% 31.5% Note (1) & (2) : Does not include depreciation expense; Note (3): Adjusted EBITDA - Operating profit for the year before depreciation and amortisation, employee benefit provision and other provisions and impairment of assets under construction; Note (4): Includes provisions, impairment of trade receivables, impairment of assets under construction, loss on disposal of property and equipment, non recurring income (/expense) and other income; Note (5): Normalised Net Profit Net Profit for the year before the one-time IPO expense of USD 5.1 million during FY

13 Balance Sheet USD ( 000) Dec-2016 Dec-2017 Cash and Cash Equivalents 5, ,964 Accounts Receivable 50,789 65,987 Other Receivables 3,226 6,034 Accrued Revenue 17,587 12,976 Dividend Receivable & Advance Payments 11,339 19,764 Inventory 17,777 20,919 Due from Related Parties Total Current Assets 106, ,950 Net Fixed Assets 290, ,987 Investments & Intangible Assets 1,950 1,950 Total Non-Current Assets 292, ,937 Total Assets 398, ,886 Bank Overdraft 15,449 21,423 CPLTD 30,356 35,911 Account Payables 27,916 31,171 Accrued Expenses & Other Credit Balances 13,133 13,226 Provisions 2,934 1,836 Due to Related Parties 4,082 2,267 Dividend Payable 7,149 7,149 Tax Liability 2,857 1,119 Total Current Liabilities 103, ,101 Long Term Debt 189, ,155 End of Service Provision Total Non-Current Liabilities 190, ,775 Paid-up Capital 1,000 42,203 Additional Paid in Capital 30, ,224 Merger reserve (1) (6,521) (6,521) Retained Earnings 75, ,622 Legal Reserves 4,481 4,481 Total Shareholders Equity 104, ,010 Total Shareholders Equity and Liabilities 398, ,886 Note (1): Represents the difference between consolidation paid under the reorganization plan and nominal value of acquired shares 13