2007 INTERIM RESULTS. September 2007

Transcription

1 2007 INTERIM RESULTS September 2007

2 Headlines Focus on operational delivery producing strong financial performance Significant growth in profits with interim dividend more than doubled Substantial backlog continues to provide excellent near-term visibility with positive order outlook Well positioned to deliver 2007 results ahead of expectations and excellent growth into 2008 and beyond Revenue Net profit Backlog 1, ,173 3,908 1,485 3, , ,097 1, H H H H June 2007 Note: all figures presented above are for the group s continuing operations (US$ millions) 2

3 Engineering & Construction Excellent operational delivery driving continued strong financial performance Good progress being made with all projects, in particular those in the construction phase, and with mobilisation and early works for the late 2006 awards in Tunisia and Egypt Continuing focus on core regions, leveraging local execution experience and where development spend has long term visibility Notable success with Karachaganak Phase III FEED award Confident of securing further awards before year end 3

4 Operations Services Strong growth in net revenues and profits driven, in particular, by international activities Safe transition of operational responsibility for Dubai s offshore oil & gas assets with positive operational performance Further growth in Brownfield and Training activities, particularly outside UKCS Continued strong operational performance from UKCS assets Integration of SPD acquisition completed, extending capability into well operations management 4 4

5 Energy Developments Strong growth in revenue and profit, reflecting full period contribution from Cendor, Malaysia Cost recovery achieved on Cendor in Q1 with further phases now being assessed Other operational assets continue to perform in line with expectation Draft field development plan submitted for Don Southwest, UKCS; consolidation of interests to increase operated position in West Don field Chergui, Tunisia, proceeding with onshore and offshore construction Farm-in to 10% operated interest, offshore north Australia 55

6 Energy Developments: developing the portfolio Tunisia, Chergui gas development UKCS, Don Southwest and West Don Kyrgyzstan, oil refinery Algeria, Ohanet gas redevelopment Malaysia, Cendor PM304 development Australia, Permit NT/P68 6

7 A strong position with National Oil Companies Tunisia, ETAP Kuwait, Kuwait Oil Company UAE, Dubai Petroleum Oman, Ministry of Oil & Gas and PDO Malaysia, Petronas Our relationships with National Oil Companies (NOCs) encompass the provision of both our engineering and operations service capabilities and as development partner through Energy Developments 7

8 Attracting the right people in core regions Aberdeen, UK 3700 Dec June 2007 Sharjah / Dubai, UAE Dec June 2007 Woking, UK Dec 2006 June 2007 Mumbai, India Chennai, India Nil 140 Dec 2006 June 2007 Dec 2006 June 2007 Building our workforce with the right skill levels and in the right places is key to ensuring sustainable growth and continued strong performance We now have over 9,500 employees, compared to around 7,700 at 30 June

9 Headline Numbers Income Statement 1H H 2006 Continuing operations Revenue 1, % Operating profit % Net finance income/(cost) 2.8 (0.7) Profit before tax Income tax expense (40.0) (21.9) Net profit % EBITDA % EPS (diluted) cents cents 46.8% Interim dividend 4.9 cents 2.4 cents 104.2% 9

10 Headline Numbers - Cash Flow 1H H 2006 FY 2006 Continuing operations Operating activities Investing activities (40.4) (8.7) (34.5) Financing activities (34.9) (23.4) (32.6) Discontinued operations (0.5) (0.5) (0.4) Net increase in cash and cash equivalents Cash and cash equivalents at period end* * Excludes restricted cash and is net of bank overdrafts Less interest-bearing loans and borrowings (127.2) (118.0) (117.2) Add back bank overdrafts** Net cash ** As netted-off against cash and cash equivalents and included in interest-bearing loans and borrowings 10

11 Group Overview Revenue increased by 14%, driven by Operations Services and Energy Developments division growth Revenue 1,485 1,8 6 4 Geographic split Middle East and Africa 37% Europe 40% CIS and Asia 23% ,0 57 Backlog marginally lower at US$3.9 billion, partly reflecting the anticipated timing of new E&C awards during 2H 2007 (31 December 2006: US$4.2 billion) Backlog 3,333 4,173 3,908 Represents 2.0 times trailing twelve months revenue (December 2006: 2.2 times) Jun-06 Dec-06 Jun-07 11

12 Group Overview EBITDA increased by 55% EBITDA & margin EBITDA margin increased from 9.6% to 13.0% due principally to: A higher proportion of EBITDA from high margin Energy Developments division An increase in E&C EBITDA margins % % 10.7% % % Net profit increased by 47% Net profit & margin Net margin increased from 5.7% to 7.3% due to increased net margins across all three divisions % 5.1% 6.5% 5.7% 7.3% 12

13 Effective Tax Rate (ETR), 1H 2007 v 2006 Tax charge by division 1H 2007 reported 2007 estimated 2006 adjusted Engineering & Construction 27.0% 35% 24.8% Operations Services 27.3% 29% 30.4% Energy Developments 50.1% 35% 39.0% Engineering & Construction division reported a lower ETR than estimated as the overall balance of profits was higher in low tax jurisdictions Operations Services reported a lower ETR than estimated due to increased activity in low tax jurisdictions and budgeted provisions were found to be unnecessary Energy Developments ETR is higher than estimated due principally to deferral of Don Southwest FDP which could potentially delay recognition of UKCS pre-trading losses 13

14 Engineering & Construction Revenue decreased by 2% Sequential growth of 13% from 2H 2006 as activity levels on contracts awarded in late 2006 increase Expected to grow more strongly in 2H 2007 Revenue , Significant contribution from Harweel development, Salam gas plant and Karachaganak 4 th train Marginally lower backlog at 30 June 2007 as expected Backlog 1, ,228 2,103 Confident of new awards in 2H 2007 Jun-06 Dec-06 Jun-07 14

15 Engineering & Construction EBITDA increased by 23% EBITDA & margin EBITDA margin enhancement reflects: Strong execution Relatively low proportion of early stage contracts Recognition of profits from contracts in their late stages % % 11.8 % % % Net profit increased by 23% Net profit & margin 95.4 Net margin growth in line with EBITDA margin growth % 6.4% 8.8% 7.7% 9.6% 15

16 Operations Services Revenue excluding pass-through revenue Revenue (net revenue) increased by 55% Growth driven by Dubai Petroleum Pass-through revenue contract, SPD acquisition and particularly international growth in Petrofac Brownfield Net revenue and Training 215 Marginally lower backlog at 30 June 2007, Dubai Petroleum contract backlog booked in 2006 Backlog 1,72 5 1, ,8 0 6 Jun-06 Dec-06 Jun-07 16

17 Operations Services EBITDA increased by 41% EBITDA & margin 32.9 EBITDA margin increased to 4.6% due largely to a decrease in proportion of pass-through revenues % 4.5% 4.5% 4.3% 4.6% Net profit increased by 53%; reported net margin increased from 2.2% to 2.6% Net profit & margin 18.1 Net of pass-through revenues, net margin maintained at 3.3% Excluding amortisation and finance charges relating to acquisition intangibles and deferred consideration, underlying net margin increased from 3.3% to 3.8% 2.7% 2.2% 3.4% 3.6% 2.6% 2.5% % 2.2% 3.8% 2.6% 17

18 Energy Developments Revenue increased by 198% due to commencement of production from Cendor field during 2H 2006 Revenue Cendor production averaged 14,300 bpd for the period Full cost recovery achieved EBITDA higher due to contribution from Cendor field EBITDA & margin % 70.4% 63.8% 64.6% 64.7%

19 Energy Developments Net profit and net margin increased significantly due to the contribution from the Cendor field Net profit and net margin % % % 23.1% 13.9 % 3.9 Net profit and adjusted net margin* Cendor tax credits 22.9% Net profit excluding Cendor tax credits 15.4 % % % % * adjusted to exclude the impact of recognition of Cendor tax credits 19

20 Outlook Market conditions continue to be very positive Well placed in terms of capability, regional presence and customer relationships Order intake for second half expected to be substantially ahead of first half Good margin development in both E&C and OS, expected to continue Well positioned to deliver 2007 results ahead of expectations and excellent growth in 2008 and beyond 20

21 Appendix 1: 5 largest current EPC contracts % of completion at 30 June 2007 Original contract value Facilities upgrade, Kuwait Kauther gas plant, Oman US$680m US$246m Harweel cluster development,oman US$983m Hasdrubal gas plant, Tunisia US$410m Salam gas plant, Egypt US$376m Dec June Dec June Dec 06--June 07-- Dec 07-- June Dec June Dec 09 21

22 Notes 1. EBITDA means earnings before interest, tax, depreciation and amortisation and is calculated as profit from continuing operations before tax and net finance costs adjusted to add back charges for depreciation, amortisation and impairment. 2. Net profit (for the group) means profit for the year from continuing operations attributable to Petrofac Limited shareholders. 3. Backlog consists of the estimated revenue attributable to the uncompleted portion of lump-sum engineering, procurement and construction contracts and variation orders plus, with regard to engineering services and facilities management contracts, the estimated revenue attributable to the lesser of the remaining term of the contract and, in the case of life-of-field facilities management contracts, five years. To the extent work advances on these contracts, revenue is recognised and removed from the backlog. Where contracts extend beyond five years, the backlog relating thereto is added to the backlog on a rolling monthly basis. Order intake comprises new contracts awarded, growth in scope of existing contracts and the rolling increment attributable to contracts which extend beyond five years. Backlog and order intake include only the revenue attributable to signed contracts for which all pre-conditions to entry have been met and only the proportionate share of joint venture contracts that is attributable to Petrofac. Backlog and order intake do not include any revenue expected to arise from contracts where the client has no commitment to draw upon services from Petrofac. Backlog and order intake are not audited measures. Other companies in the oil & gas industry may calculate these measures differently. 4. Operating profit means profit from continuing operations before tax and net finance costs. 22

23 Important Notice This document has been prepared by Petrofac Limited (the Company) solely for use at presentations held in connection with the announcement of its interim results for the six months ended 30 June The information in this document has not been independently verified and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. None of the Company or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss whatsoever arising from any use of this document, or its contents, or otherwise arising in connection with this document. This document does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any shares in the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment or investment decisions relating thereto, nor does it constitute a recommendation regarding the shares of the Company. Certain statements in this presentation are forward looking statements. By their nature, forward looking statements involve a number of risks, uncertainties or assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward looking statements. These risks, uncertainties or assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward looking statements contained in this presentation regarding past trends or activities should not be taken as representation that such trends or activities will continue in the future. You should not place undue reliance on forward looking statements, which speak as only of the date of this presentation. The Company is under no obligation to update or keep current the information contained in this presentation, including any forward looking statements, or to correct any inaccuracies which may become apparent and any opinions expressed in it are subject to change without notice. 23