Pareto s oil and offshore conference Jan Arve Haugan, President & CEO
Well positioned for future market opportunities 1) Leading contractor within proven track record 2) Competitive position strengthened a) Delivering projects predictably: Safely, on time, with right quality b) Improved cost position 3) Solid financial platform 4) Near term market opportunities in selected regions 2
175 th anniversary: 1841-2016 Leading contractor with proven track record: CONCRETE SOLUTIONS JACKETS TOPSIDES ONSHORE Global leader in gravity based concrete structures European leader in steel jackets Leading EPC contractor to the Norwegian Shelf Leading Norwegian EPC contractor for offshore plants Substructures Steel jackets Topsides Upstream plants CONDEEP TM GBS Floating concepts LNG terminals Other steel structures Piping technology Floating platforms Hook up Completion Treatment facilities 2 700 employees in 8 countries Revenues of NOK 12 billion (2015) Order backlog of NOK 10.2 billion (as of 30 June 2016) 3
Our competitive edge: HSSE - Expertise - Execution model - Predictability GOOD HSSE OUR LICENCE TO OPERATE PREDICTABLE DELIVERY Photo: Lundin Norway FEED E Engineering P Procurement C Construction Hook-up & completion ENGINEERS AND PROJECT MANAGERS WITH EXTENSIVE EXPERIENCE MARTIN LINGE SECIALISED FACILITIES AND IN-HOUSE YARDS 4
Delivering as committed: All projects on track for predictable delivery Johan Sverdrup: EPC contracts for the Riser, Drilling and Process platform steel jackets Johan Sverdrup: EPC for the utility and living quarters topside Nyhamna: EPCM onshore contract with options for Maintenance and Modifications to 2022. Hebron: Detailed engineering, procurement, construction and installation (EPCI) of GBS Marine installation Njord A: Frame agreement for for upgrading of the semi-submersible platform Aasta Hansteen: A sub-contract to provide services for inshore and offshore hook-up and commissioning assistance for the topsides 5
Use of funds Balance sheet Revenues & EBITDA Solid financial platform Activity level estimated at around NOK 10 billion for 2016 Improved project portfolio EBITDA margin increase in 2016 vs. 2015 Net cash of NOK 2.5 billion Robust capital structure with NOK 2.0 billion in undrawn facilities Working capital of negative NOK 1.47 billion 2016: Capex of NOK 200 million incl. 3 new cranes Annual maintenance capex of NOK 30-50 million Strategic development Note: All figures as reported in 2 nd quarter 2016. 6
Documented improvements of competitiveness: Further improvements may trigger more new projects Joint industry improvement initiatives Reducing internal costs by NOK 250 million (2015-2016) More effective execution model Dialogue re-new step changes with selected clients 15% improved cost base by Q1 2015 New operating model Reductions to capacity and administration Refined and leaner organisation Most Norwegian operations in one unit 7
Market: Focus on selected geographic regions Near term market Studies and FEEDs ongoing Some few but important prospects of moderate size: Completion, hook-up and commissioning, decommissioning, modifications Greenfield / brownfield EPC for offshore platforms and onshore facilities 8
Based on core competence, solid financial platform and credibility in the market Strategic development Leading EPC & HUC contractor 9
Well positioned for future market opportunities Safe and predictable execution Competitive position strengthened Solid financial platform Pursuing specific prospects Interesting strategic opportunities HSSE core value and licence to operate Maintain and develop home markets Develop global delivery model for Norway and abroad Hands-on management 10
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