PARETO OIL & OFFSHORE CONFERENCE Simen Lieungh President & CEO 2 September 2015
HSE never compromise H1 frequency Lost time incident 3,4 3,3 2,67 2,1 1,4 1,1 0,6 0,3 2008 2009 2010 2011 2012 2013 2014 2015* (as per 1 million working hours) Dropped objects frequency 10,08 9 5,6 4,3 6,5 8,6 5,4 3,3 H2 frequency Total recordable incident 2008 2009 2010 2011 2012 2013 2014 2015* 2008 2009 2010 2011 2012 2013 2014 2015* 7,71 9 8,9 5,9 (as per 1 million working hours) 3,8 2,5 3,7 2,1 2008 2009 2010 2011 2012 2013 2014 2015* (as per 1 million working hours) * Per 30 June 2015 2
An integrated partner for harsh environment and ultradeepwater operations 3
Group Financial highlights YTD per Q2 2015: Operating revenue of USD 526 million *Group Operating Revenues (USDm) 1 174 1 088 1 094 1 057 *EBITDA of USD 163 million 782 *EBITDA-margin of 31% *Net profit of USD 42 million 286 272 526 545 At 30 June 2015: Q2 15 Q2 14 YTD 15 YTD 14 FY 14 FY 13 FY 12 FY 11 FY 10 Gross interest bearing debt of USD 1.72 billion Cash and cash equivalents of USD 212 million *Group EBITDA (USDm) 393 331 382 USD 900 million in book equity and equity-ratio of 32% Earnings visibility through USD 2.2 billion of firm order backlog plus 2.0 billion in priced options 92 91 163 165 270 88 Q2 15 Q2 14 YTD 15 YTD 14 FY 14 FY 13 FY 12 FY 11 FY 10 * Adjusted for USD 245 million impairment write-downs in Deep Sea Metro and a USD 3.4 million loss on trade receivables made in Q2 2015 Page 4
Highlights & material events YTD 2015 Aberdeen commenced on its 7-year contract in April 2015. Atlantic secured a contract with Statoil in the Johan Sverdrup field for a period of three years plus 6x6 months options. Metro I commenced drilling operations under its Vietnam contract in August Metro II - sales process initiated Platform Drilling secured a contract with Statoil for the platform drilling services on the Johan Sverdrup platform, including assistance during the engineering, construction and commissioning phase of the Johan Sverdrup field development project. The firm contact period is 4 years plus 3 x 2 year options. Page 5
Group Contract backlog Total revenue backlog per year for firm contracts and priced option periods 1 YTD per Q2 2015: USD million Operating revenue of USD 526 million 1000 Firm Options *EBITDA of USD 163 million Firm contracts USD 2.2 billion Priced options USD 2.0 billion 1044 800*EBITDA-margin of 31% Total backlog USD 4.2 billion *Net profit of USD 42 million 600 At 30 June 2015: 400Net interest bearing debt of USD 1.5 billion 349 3 Cash and cash equivalents of USD 212 million 200 346 572 73 499 623 221 402 USD 900 million in book equity and equity-ratio of 32% 564 229 335 824 539 543 311 332 228 211 220 0 Earnings visibility through USD 2.2 billion of firm order backlog plus 2.0 billion in priced options Revenue backlog for Well Services, Technology and MODU Management is not included in the revenue backlog above. 2H 2015 2016 2017 2018 2019 2020 After 1) Estimates at 30 June 2015, includes pro-rata backlog figures in respect of Odfjell Drilling s 40% ownership in Deep Sea Metro Ltd, but does not include any backlog for Odfjell Drilling s share of Odfjell Galvão. Total backlog figures may not equal the sum of firm contracts and priced option periods for the year due to rounding. Page 6
MODU segment fleet & contract status Drilling unit Location /operator day rate (USDk/day) 1 Contract status Stavanger Angola BP Angola 545 Atlantic Norway Statoil 300 6 X 6 months Aberdeen UK BP Exploration 450 Bergen Norway Statoil 350 Metro I Vietnam Vietgazprom 255 2 Metro II For sale Stacked in Curacao n/a Guarapari Brazil Petrobras 518 3 Itaoca Brazil Petrobras 525 3 Siri Brazil Petrobras 529 3 2014 2015 2016 2017 2018 2019 2020 2021 2022 Contract Option Construction 1) Rates may include mix of currencies and fluctuate based on exchange rates. 2) Day rate net of taxes 3) In addition to the day rate there is a bonus element of up to 15% linearly from 93% to 98% utilization. Contract length for each of the units is 15 years from commencement of operations. The outcome of the ongoing restructuring of Sete and the Brazilian restructured newbuild or cancelled, program is uncertain at present. This could potentially lead to this program being fundamentally 7 Page 7
Well Services segment Presence BASES : EUROPE Norway Key figures ~510 employees United Kingdom Holland Romania Services from 11 bases Operations in more than 20 countries Service offering Tubular runnng services BASES : ASIA Thailand Vietnam Drill tool rental services Well intervention services BASES : MIDDLE EAST Saudi Arabia United Arab Emirates Turkmenistan Kurdistan BASE OPERATIONS A leader in remote operated drilling technologies 8
Well Services segment Core service offering - A leader in remote operated drilling technologies - Tubular Running Services Drill Tool Rental Services Well Intervention Services Safe and efficient services with leading edge technology Highly skilled and experienced operators Conventional equipment, but also have the ability to provide remote radio controlled Top Drive mounted running tools Remote operated and conventional power tongs Full suite of casing and tubing running and recovery High performance drilling tools meeting the strictest quality standards Drill pipe, collars and tubing Tubular handling equipment Hole openers and roller reamers Stabilizers, subs, valves and mule shoes Jars and shock tools Fishing and wellbore cleanup tools Chosen for established position, experience and expertise Highly skilled and experienced operators Fishing services Casing exit services Wellbore cleanup services Well abandonment services 9
Odfjell Drilling - providing expertise for the Johan Sverdrup field development Mobile drilling services Platform drilling Engineering Well services Services 10
Outlook Satisfactory fundamental long-term demand for the Group s services but near term softening materialised MODU The drilling market has continued weakening during 2015 and we expect a further weakening into 2016. The competition for securing employment is fierce Bifurcation between modern drilling units and older units will continue and this is in favour of Odfjell Drilling s fleet. Within the next few years we believe that the increased scrapping in combination with required exploration and development drilling will bring the market back to balance and subsequent improved day rates. Well Services Well Services has maintained its activity level on the Norwegian Continental Shelf (NCS) compared to the level entering into 2015. Despite fierce competition also outside the NCS, Well Services has maintained its activity level and margins in in Q2 15. Our equipment pool of remote operated tools and increased focus on well intervention services has strengthened our competitive advantage in a market with reduced overall activity. Drilling and Technology The slowdown in the North Sea area has led to continued low activity level for development and upgrade projects. To meet this challenge the Group has reorganised its engineering services to increase efficiency and reduce its cost base. Page 11
Thank you President & CEO Simen Lieungh For more information see: www.odfjelldrilling.com