Dolphin Group ASA. SEB Nordic Seminar - 8 th January Atle Jacobsen (CEO) & Erik Hokholt (CFO)

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2 Dolphin Group ASA SEB Nordic Seminar - 8 th January 2015 Atle Jacobsen (CEO) & Erik Hokholt (CFO) 2

3 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. Such forward-looking information and statements 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 Dolphin Group ASA ( Dolphin Group or Dolphin ) and its subsidiaries. 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 the Dolphins 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. Although Dolphin believes that its expectations and the information in this Report were based upon reasonable assumptions at the time when they were made, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in this Report. Dolphin nor any other company within the Dolphin group is making any representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the information in the Report, and neither Dolphin, any other company within the Dolphin Group nor any of their directors, officers or employees will have any liability to you or any other persons resulting from your use of the information in the Report. Dolphin undertakes no obligation to publicly update or revise any forward-looking information or statements in the Report. There may have been changes in matters which affect Dolphin Group subsequent to the date of this presentation. Neither the issue nor delivery of this presentation shall under any circumstance create any implication that the information contained herein is correct as of any time subsequent to the date hereof or that the affairs of Dolphin Group has not since changed, and Dolphin Group does not intend, and does not assume any obligation, to update or correct any information included in this presentation. The contents of this presentation are not to be construed as legal, business, investment or tax advice. Each recipient should consult with its own legal, business, investment and tax adviser as to legal, business, investment and tax advice. This presentation is subject to Norwegian law, and any dispute arising in respect of this presentation is subject to the exclusive jurisdiction of the Norwegian courts. 3

4 Business lines Marine Contract Multi-Client Processing & Imaging Processing Software Expanding modern fleet Growing Multi-Client data library Full onshore & offshore processing & imaging Land & marine seismic processing software In production Library of modern 2D & 3D data In-house Processing and R&D Software for the 21 st Century 5x High-End 3D vessels 1x Mid size 3D vessel 1x Ice-class 2D vessel Under construction 1x High-End 3D vessel to be delivered in Q Areas of focus: North Sea UK and Norway Norwegian Barents Sea West Africa Brazil USD 168 million already invested 30,500 km 2 of 3D and 49,000 km of 2D successfully completed Processing centres in UK and Singapore On-board Processing on all vessels Fast data delivery AVO Friendly Broadband solution (SHarp) QC, Time & Depth Processing Interactive processing technology Advanced 2D and 3D visualisation Developer s environment Parallel processing and job management 4

5 The expansion and revenue growth according to plan Revenues USD million Illustrative 2015 target >500 Revenues are growing with an expanding fleet >400 Polar Empress (Q2 2015) Fastest growing marine seismic company 5

6 Dolphin financials quarterly developments (USD million) Summary: Revenues of USD million, compared to USD 70.1 million in Q EBITDA of USD 38.2 million (29,7%), compared to USD 26.4 million in Q EBIT of USD 21.1 million (16,4%), compared to USD 17.4 million in Q Net Income of USD 12.2 million, compared to USD 11.6 million in Q Trend development Q3: Significant revenue growth through increased vessel capacity Successful regional expansion, reduced North Sea exposure High-capacity vessels improve operating margins and profit Introduction of Polar Empress and re-delivery of two low-capacity vessels in the coming 3-15 months, will improve consolidated margins and competitiveness 6

7 Multi-Client library with book value of USD 115 million ( end Q3) Q3)(q3) Book value Selective investments are made in attractive exploration areas in Norway, UK and Brazil Focus on sales from existing library, which is well positioned for Norwegian 23rd round, Brazil Pre-Salt round in 2015 and APA 15 round Net cash invest vs. net sales investment target Multi-Client investments of less than USD 50 million for 2014, primarily due to cash preservation to be used on new vessels We continue to target a balance between cash investment and net sales 7

8 Regional strategy successfully implemented well positioned for the Northern Hemisphere winter season Artemis Atlantic (Stacked) Bergen Oslo London Houston Polar Duchess (Contract) Polar Marquis (Contract)) Artemis Arctic (Contract) Singapore Sanco Sword (Contract) Sanco Swift (Contract) Polar Duke (Contract) Offices Dolphin 3D Multi-Client Dolphin 2D Multi-Client Vessels 8

9 Strong backlog, de-risked in three regional markets Order backlog of USD 340 million as of 1 November 2014 (Q3 report) Out of total backlog, 35% is secured by clients request for Dolphin powerful solutions Dolphin backlog increased significantly over the last 5 quarters - ~ 97% covered for Q ~ 85% covered for Q ~ 60% covered for Q ~ 10% covered for Q3 15 Modern high-capacity 3D vessels in demand 9

10 Rapid and successful fleet expansion one vessel to go Polar Duke (3D, str) Polar Duchess (3D, str) Sanco Swift (3D, 16 str) Polar Marquis (3D, 14 str) Delivered May 2011 Delivered April 2012 Delivered July 2013 May 11 Q1 12 Q2 13 Q2 14 Fully operational fleet Delivered May 2014 Q1 15 Vessels to be delivered Artemis Atlantic (2D) Artemis Arctic (3Dm 6/8str) Sanco Sword (3D, 16 str) Polar Empress (3D, 22 str) Delivered May 2011 Delivered May 2011 Delivered April 2014 Delivery April

11 Dolphin is asset-light with flexible Time-Charter commitments Vessel Firm initial period/options Artemis Atlantic Polar Duke Artemis Arctic TC firm 4 years from May '11 Option of 2+2 years TC firm 5 years from May '11 Option of 6 years TC firm 5 years from May '11 Option of 2+2 years April Redelivery May May Polar Duchess Polar Marquis TC firm 5 years from March '12 Option of 4+2 years TC firm 3.5 years from May '14 Option of 2+2 years March Nov Sanco Swift TC firm 5 years from June '13 Option of years June Sanco Sword TC firm 5 years from March '14 Option of years March Polar Empress TC firm 5 years from April '15 Option of 3+3 years April Comments: Initial firm Time-Charter (TC) period of years Variable options to extend TCs Control high-end vessels in 11 years, only small index adjustment of the terms in option period TC periods end one per year over the coming 6 years Dolphin business model is flexible and highly favourable compared to steel on balance sheet 11

12 The three largest players control some 60% of total market Recent changes indicate a reduction of 10 vessels from 2013 to 2014 Market shares (# of vessels 3D fleet) Market shares (# of practical streamers 3D fleet) Other 68 12% 4% 12% 15% 65 15% 6% 11% 17% 55 16% 11% 13% 56 16% 12% 12% 55 16% 11% 12% Other % 5% 13% 16% % 7% 12% 18% % 13% 14% % 15% 13% % 13% 13% 25% 25% 18% 18% 18% 24% 24% 21% 19% 21% 16% 18% 18% 18% 19% 19% 32% 32% 26% 26% 25% 23% 23% 23% 20% 19% E 2015E 2016E E 2015E 2016E Assumed Artemis Arctic (Dolphin) is taken out in 2016 Includes SCF vessel (Polarcus) currently on bareboat, and where SCF has purchase option 12

13 Dolphin s fleet is among the most powerful in the industry 25% 13% High End Increased market share in 14+ streamer market -> higher margin 13

14 Multi-Client update (as per Q3 report) Late Sales below expectations due to client budget constrains and delayed investments due to lack of licensing rounds 1 Completed Barents Sea acquisition of Gohta SHarp 3D over both Norwegian APA 2014 and 23rd Round acreage (79% pre-funded) Increased sales activity in Q4, triggered by upcoming licensing rounds and significant discoveries 11 Key focus areas for the coming quarters will be; Barents Sea, North West Africa and Brazil w Solid Late Sales already secured in Q4 14

15 Strong position in the Barents Sea Dolphin is delivering on a long-term strategy of becoming a leading Multi- Client player in the Barents Sea The Gohta and recent Alta discovery trigger extensive interest for the upcoming 23rd and APA Round Also the recent Isfjell and Wisting discoveries make Dolphin s entire Multi-Client position attractive The recent Hoop South 2D grid combines the 3D data sets Dolphin will continue to build presence around existing data 15

16 Processing & Imaging continued growth Financials Record external revenue of USD 2.9 million (+38% vs. Q2) Further external revenue growth expected in Q4 Backlog maintained at approx. USD 10 million Quarterly external revenue growth Services UK office re-located in Q3 and compute capacity doubled 0 Q Q Q Q Q Q Q Houston office expected to be fully manned and operational in Q4 Increased emphasis on PSDM and processing not tied to our boats Processing software - Open Geophysical Land and marine seismic processing for 21 st century Advanced 3D & 2D visualisation Five further sales to contractors and oil companies, totalling 100+ external licences AI Inversion of SHarp Multi-Client data 16

17 Global market outlook 2015 The combination of our clients being more prudent managing their cash-flow, Russian sanctions and recent sharp drop in oil price, are adding to the negative sentiment in the seismic industry The negative sentiment is visible through a slowdown in tender activity, resulting in increased pricing pressure and lower utilisation Negative market effects damped by strong Dolphin backlog Multi-Client sales more selective, but still significant and even more driven by licensing rounds and discoveries Significant reduction in seismic supply due to vessel stacking will contribute to improved supply/demand balance going forward 17

18 Global market outlook 2015 (continued) Dolphin experience that drop in Oil-price is not resulting in postponements of live tenders Several high volume contracts awarded to industry in December (Colombia, Myanmar, Pacific and Egypt) Several high volume contracts scheduled to be awarded in January North Sea 4D tenders from three different clients in tender evaluation process Still high tender activity from Russian companies Demand for 3D high-end and wide-tow capacity is growing with increased cost focus from our clients Increased trend of proprietary contracts converted to Multi-client deals Focus on further reducing Dolphin cost base and improve efficiency Lower fuel cost Favorable USD/NOK 18

19 2014 original guidance - successfully delivered Two new high-capacity vessels, Sanco Sword and Polar Marquis delivered Revenues expected to exceed USD 400 million for Multi-Client investment in prospective areas offshore Brazil, Norway and UK Multi-Client investments of USD million for 2014 Processing services to grow more than 50% in 2014 Select and prepare for the next generation of multi-sensor streamer technology Extending the broadband advantages of Dolphin's acquisition and processing technique SHarp < USD 50mill. 19

20 2015 Guidance - summary (full detailed guidance in appendix) Dolphin s full year revenue is expected to exceed USD 500 million for 2015, representing a growth of 15-20% from 2014 The Dolphin Multi-Client investments will primarily be made in prospective offshore areas. Dolphin expect to allocate 15-20% of 3D vessel capacity to Multi-Client investments for 2015, representing cash investments of approximately USD million The new and final 3D vessel, Polar Empress with streamer capacity, is on schedule and is expected to be taken on charter in end of April 2015 Dolphin will fully divest from the marine 2D and low-end 3D seismic market in 2015 In a challenging market environment, Dolphin will focus on market positioning of the 6 modern high-capacity 3D seismic vessels, seismic processing and sales from an attractive Multi-Client seismic data library During 2015, Dolphin will prepare for the next generation of multi-sensor streamer technology, new acquisition techniques and joint cooperation models both on exclusive and non-exclusive basis will be targeted 20

21 Question & Answer Session 21

22 Dolphin detailed assumptions and guidance for 2015 (updated as per 8 January 2015) New Vessel capacity to be delivered on time and budget Polar Empress (3D, str.) to be delivered end April 2015 Pricing, costs, utilisation Overall revenues expected to exceed USD 500 million for 2015 Expected day-rates of USD/day in 2015 for 3D high-end seismic vessels, pending region and configuration Utilisation high-end 3D vessels, 82-88% Cash Opex high-end 3D vessels of ~ USD/day All high-end 3D vessels will be permanently accompanied by 1x chase vessel and 1x support/fuel vessel Other external third party costs and revenues, 6-8% of revenues for 3D vessels. In addition individual reimbursable country specific costs will apply Estimated SG&A costs USD million per quarter in 2015 Multi-Client activities Capex MCS 3D, 15-20% of vessel capacity Total cash MCS-investments in the range of USD million Pre-funding targets of 2D > 50% and 3D>70% Sales ratio s 1.,7 2.2 times MCS investment costs New seismic equipment investment of total approximately USD 45 million for 2015 Capacity upgrade and maintenance of USD 8-10 million, dependent on clients configuration request Processing 2015, USD 3-5 million 22