Interim Financial Statements

Transcription

1 [Type text] Interim Financial Statements KCA Deutag Alpha Limited For the nine months ended 30 September 2014 Page 1 of 11

2 Table of Contents Consolidated income statement... 3 Consolidated statement of changes in shareholder's equity... 3 Consolidated balance sheet... 4 Consolidated cash flow statement... 5 Notes to the quarterly financial statements Significant accounting policies Compliance with IAS Basis of preparation Segment reporting Net finance costs Exceptional items Reconciliation of net debt Tangible fixed assets Intangible assets Trade and other receivables Trade and other payables Cash generated from operating activities Assets and liabilities of disposal group held for sale Page 2 of 11

3 Consolidated income statement Note Sales 2 1, , Operating costs (1,331.4) (1,367.4) (446.5) (464.0) EBITDA Depreciation/Amortisation (151.3) (147.8) (50.7) (49.7) Operating profit (pre-exceptional) Exceptional items (including impairment) 4,6 (40.4) (7.6) (21.3) (1.6) Operating profit (post-exceptional) Income from associates/jvs - (0.3) - - Net finance costs 3 (119.9) (118.4) (30.5) (28.0) Profit (loss) before tax (68.3) (81.6) (29.0) (5.6) Taxation (30.9) (32.4) (7.8) (9.0) (Loss) after tax (99.2) (114.0) (36.8) (14.6) Consolidated statement of changes in shareholder s equity Share capital Share premium Retained earnings Other reserves Total $m At 1 January (1,647.0) 1, Comprehensive income (expense) Loss for the period - - (99.2) - (99.2) Other comprehensive income (expense) Fair value movement on cash flow hedges Exchange differences on foreign operations (0.8) (0.8) Actuarial gains on defined benefit plans Deferred tax on retirement benefit obligation Total other comprehensive income (expense) (0.8) (0.8) Total comprehensive income (expense) - - (99.2) (0.8) (100.0) Transactions with owners Capital contribution At 30 September (1,746.2) 1, At 30 September (1,553.6) 1, Page 3 of 11

4 Consolidated balance sheet Q Q Audited Q Note $m $m $m Assets Non-current assets Property, plant and equipment 6 1, , ,048.4 Goodwill Intangible assets Investments Deferred tax assets , , ,780.6 Current assets Inventories and work-in-progress Trade and other receivables Amounts owed by parent company Financial assets - derivative financial instruments 1.0 (0.7) - Cash, cash equivalents and other deposits Assets of disposal group classified as held for sale Total assets 2, , ,562.4 Liabilities Current liabilities Bank overdraft (45.7) - - Trade and other payables 9 (431.6) (418.0) (383.5) Tax liabilities (48.0) (46.8) (49.9) Financial liabilities - derivative financial instruments (0.1) Financial liabilities - borrowings (8.2) (4.8) (5.2) Provisions and other payables (2.5) (3.5) (3.4) (536.1) (472.8) (442.0) Non-current liabilities Financial liabilities - borrowings (1,203.9) (1,257.0) (1,259.8) Amounts owed to parent company (537.0) (719.4) (478.9) Deferred tax liabilities (50.5) (69.0) (66.4) Retirement benefit obligations (123.7) (134.8) (132.3) Provisions and other non-current liabilities (3.9) (1.0) (4.8) (1,919.0) (2,181.2) (1,942.2) Liabilities of disposal group classified as held for sale 11 (7.8) - (11.7) Total liabilities (2,462.9) (2,654.0) (2,395.9) Net assets Capital and reserves Share capital Share premium reserve Other reserves 1, , ,799.3 Retained earnings (deficit) (1,746.2) (1,553.6) (1,647.0) Total shareholder s funds Page 4 of 11

5 Consolidated cash flow statement Q Q Q Q YTD YTD Note Cash flows from operating activities Cash generated from operations Tax paid (39.6) (24.9) (9.8) (8.3) Net cash inflow (outflow) from operating activities (10.8) Cash flows from investing activities Capital expenditure (148.4) (101.1) (65.8) (28.2) Proceeds from sale of property, plant and equipment Purchase of intangible assets (3.3) (2.3) (2.4) (0.2) Other investments (0.9) Interest paid, including capitalised interest (61.3) (52.0) (7.2) (5.4) Interest received Exchange differences arising on investing activities (2.0) Net cash (outflow) inflow from investing activities (195.5) (99.2) (61.2) (32.8) Cash flows from financing activities Bank loan drawdowns (repayments) (65.2) 63.9 (4.1) (11.1) Finance lease payments (4.3) - (1.4) - Exchange differences arising on financing activities 12.1 (0.4) Net drawdown (repayment) of borrowings (57.4) (8.9) Equity injection from (repaid to) parent Capitalised debt issuance costs (24.6) (44.4) 0.1 (2.8) Net cash (used in) generated from financing activities (82.0) (11.7) Effect of foreign exchange rate changes on cash and bank overdrafts (14.3) (2.0) (8.4) (4.5) Net cash in (out) flow (112.3) (33.9) (13.2) (47.2) Cash and bank overdrafts at start of period Cash and bank overdrafts at end of period 2 (4.8) 42.8 (4.8) Includes $0.3 million of cash held by disposal group classified as held for sale at 31 December Includes $1.1 million of cash held by disposal group classified as held for sale at 30 September Page 5 of 11

6 Notes to the Quarterly Financial Statements 1. Significant Accounting Policies 1.1 COMPLIANCE WITH IAS 34 These condensed quarterly consolidated financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting. They do not contain all the disclosures required for annual financial statements and should therefore be read in conjunction with the Group s annual financial statements for the year ended 31 December 2013, prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. 1.2 BASIS OF PREPARATION General principle The preparation of these condensed quarterly financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group s accounting policies. The areas involving a higher degree of judgement, complexity or areas where assumptions and estimates are significant to the condensed quarterly consolidated financial statements are disclosed in Note Accounting estimates and judgements Accounting estimates and underlying assumptions are based on past experience and other factors considered reasonable under the circumstances. They serve as the basis for any judgement required for determining the carrying amounts of assets and liabilities when such amounts cannot be obtained directly from other sources. Actual amounts may differ from these estimates. The main sources of uncertainty relating to estimates used to prepare the interim consolidated financial statements were the same as those described in the full year 2013 consolidated financial statements Specific issues concerning the preparation of interim financial statements For the purpose of preparing the Group s condensed interim consolidated financial statements, the following calculations and estimates are applied in addition to the recognition, measurement and presentation rules described in note 1.2.2: - The current and deferred tax charge for the period is calculated by applying the estimated average annual tax rate for the current fiscal year to the three months pre-tax income for each entity or tax group; and - Expenses relating to pensions and other post-employment benefit obligations are estimated based on the prorate temporis amount expected for the full year, except where specific events occur which have a material impact on the consolidated financial statements, in which case adjustments are made. Page 6 of 11

7 2. Segment reporting Revenues Platform services RDS Land Drilling MODUs Bentec Central overheads (0.5) Elimination on consolidation (84.5) (22.0) (40.0) (4.3) GROUP TOTAL 1, , EBITDA (pre-exceptional) 1 Platform services RDS Land Drilling MODUs Bentec Central overheads (20.1) (22.6) (8.2) (8.4) Elimination on consolidation (2.6) - (1.5) - GROUP TOTAL EBITDA by segment for 2013 has been represented to reallocate support costs which were previously shown as central overheads (such as HR, Supply Chain and IT costs) to the operational business segments figures are presented on the same basis. 2 Brunei Land Rig has been re-classified from MODUs to Land Drilling to be consistent with statutory accounts segmentation. Page 7 of 11

8 3. Net finance costs Interest payable to immediate parent company (11.9) (10.4) (4.2) (3.7) Interest payable on bank borrowings (25.3) (51.5) (6.0) (11.7) Interest payable on Senior Secured Notes (46.4) (19.4) (18.8) (12.3) Finance costs on VTB debt (1.2) (0.4) (0.5) (0.4) Less amounts included in the cost of property, plant and equipment Commitment fees - (0.4) - (0.1) Amortisation of arrangement fees (8.7) (35.2) (2.0) (4.9) Amortisation of discount assets (2.8) - (1.0) - Write off of arrangement fees (29.6) Other finance costs (6.5) (1.4) (1.1) (0.3) Finance costs (127.1) (109.9) (32.5) (30.3) Bank interest receivable Other finance income Finance income Exchange gains (losses) 6.8 (9.1) Finance costs - net (119.9) (118.4) (30.5) (28.0) 4. Exceptional items Business efficiency costs 1 (1.5) (4.8) (0.4) (1.5) Disposal of Ben Avon (0.7) - - Disposal of Tender Barges 3 (19.4) Refinancing costs 4 - (0.3) Disposal of interest in Libyan entity 5 - (2.7) - - Insurance recovery re Libyan stock (0.5) Pre-acquisition liability Glen Tanar Libya asset write down 8 (20.5) - (20.5) - Reorganisation Costs 9 - (1.4) - (0.5) Others (0.4) (0.9) (0.4) (0.6) GROUP TOTAL (40.4) (7.6) (21.3) (1.6) 1 Professional fees and salaries re ongoing business efficiency programme. 2 Credit received from purchaser re revenue and freight charges. 3 Asset write downs in respect of the disposal of the Tender barges business. 4 Refinancing costs relate to professional fees incurred as part of the Group s refinancing process during early 2013 which have been capitalised as part of capitalised loan arrangement fees. 5 Loss on sale of shareholding in Intairdril Libya Limited. Disposal proceeds of $3.5million were offset by the disposal of $6.2 million of net assets held by the company resulting in a loss on sale of $2.7million. 6 A $3.2 million recovery from the Group s insurers was received during 2013 in respect of a fire which destroyed stock at a warehouse in Libya in Provision was made during 2013 for a customer claim relating to pre-acquisition items associated with the GTB business acquired in Following negotiations with the customer $1.2m of the provision was reversed in Q Write down of asset values in Libya as a result of ongoing political unrest and a decision to cease our operations in Libya. 9 Reorganisation costs include rationalisation and redundancy expenditure and various other non-recurring project items. Page 8 of 11

9 5. Reconciliation of net debt Opening net debt (1,157.5) (1,130.4) (1,205.9) (1,180.8) Net cash in (out) flow (112.3) (33.9) (13.2) (47.2) Net cash generated from (used in) financing activities 69.5 (122.9) Other non-cash movements (16.6) 68.2 (3.3) (2.1) Closing net debt per balance sheet (1,216.9) (1,219.0) (1,216.9) (1,219.0) Capitalised arrangement fees (56.0) (77.2) (56.0) (77.2) Closing net debt (1,272.9) (1,296.2) (1,272.9) (1,296.2) 6. Tangible fixed assets Land and buildings long leasehold and freehold Drilling rigs and equipment Plant, machinery and vehicles Total Cost At 1 January , ,852.6 Additions at cost Disposals (2.8) (2.9) (1.0) (6.7) Exchange adjustments (0.1) (8.0) (4.4) (12.5) Transferred to disposal group held for sale 2 - (2.4) - (2.4) At 30 September , ,033.4 Accumulated depreciation At 1 January Charge for the period Impairment charge for the period Disposals (0.4) (2.8) (0.8) (4.0) Exchange adjustments (0.1) (3.1) (4.2) (7.4) Transferred to disposal group held for sale 2 - (21.7) - (21.7) At 30 September Net carrying amount At 30 September , ,108.1 Net carrying amount At 31 December , Includes capitalised interest of $5.3 million and two Land rigs transferred into the Group at no cash cost with a book value of $49 million. 2 Assets with a book value of $45 million at 31 December 2013 have been transferred to a disposal group held for sale. In the period since 31 December 2013, a further $2.4 million of assets have been capitalised and transferred and impairment and depreciation charges of $21.7 million have been booked on those assets held for sale. $8.7 million of assets held for sale were sold during Q (see note 11). Page 9 of 11

10 7. Intangible assets Customer relationships and contracts Trade name Technology Total Cost At 1 January Additions at cost At 30 September Accumulated amortisation At 1 January Charge for the period At 30 September Net carrying amount At 30 September Net carrying amount At 31 December Trade and other receivables Q Q $m $m Trade receivables Other receivables Prepayments and accrued income Transferred to disposal group held for sale (Note 11) (2.4) - Total Trade and other payables Q Q $m $m Trade payables Other tax and social security Other payables Accruals Payments received on account Deferred income Transferred to disposal group held for sale (Note 11) (7.8) - Total Page 10 of 11

11 10. Cash generated from operating activities Q Q Q Q YTD YTD (Loss) profit for the period (99.2) (114.0) (36.8) (14.6) Adjustments for: Tax charge (credit) Depreciation Impairment of tangible fixed assets Amortisation of intangible assets Amortisation of deferred costs (Gain) loss on sale of property, plant and equipment, excluding exceptionals (1.2) 2.1 (0.3) 0.4 Net movement in provisions, other liabilities and retirement benefit obligations (2.3) 1.4 (2.1) 0.9 Net finance cost Share of associates post tax result (Increase) decrease in inventories and work in progress (25.6) (18.2) 14.4 (7.5) (Increase) decrease in trade and other receivables (1.3) (155.7) 7.6 (60.1) Increase (decrease) in trade and other payables 27.1 (0.2) (14.1) 4.4 Cash generated from operating activities Assets and liabilities of disposal group held for sale Q Q $m $m Property, plant and equipment Inventories - - Trade and other receivables (Note 8) Cash and cash equivalents Total assets Trade and other payables (Note 9) (7.8) - Total liabilities (7.8) - The above table represents the book value of certain assets and liabilities within the MODUs business which are held for sale. On 16 October 2014, the Group completed the sale of its two remaining Self-Erect Tender Barges. Page 11 of 11