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Oceaneering.com
Investor PresentationSeptember 2018
1
Forward-Looking Statements
Statements we make in this presentation that express a belief, expectation, or intention are forward looking. Forward-looking statements are generally accompanied by words such as “estimate,” “project,” “predict,” “believe,” “expect,” “anticipate,” “plan,” “forecast,” “budget,” “goal,” or other words that convey the uncertainty of future events or outcomes. These forward-looking statements are based on our current information and expectations that involve a number of risks, uncertainties, and assumptions. Among the factors that could cause the actual results to differ materially from those indicated in the forward-looking statements are: industry conditions, prices of crude oil and natural gas, our ability to obtain and the timing of new projects, and changes in competitive factors. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, actual outcomes could vary materially from those indicated.
For additional information regarding these and other factors, see our periodic filings with the Securities and Exchange Commission, including our most recent Reports on Forms 10-K and 10-Q.
2
Reasons to Own Oceaneering
• Provider of integrated technology solutions
• Strong portfolio of diversified services and products
• Geographically dispersed asset base and revenue streams
• Serves blue chip customers
• Strong market positions
• Strong balance sheet, and the financial flexibility to invest and grow the company
3
Phase% of Oceaneering Revenue*
Exploration 10%
Development50%
Production35%
Decommissioning5%
Market Driver Operating Floating Drilling Rigs
Subsea Tree Installations
Subsea Trees In Service
Field Abandonments
• ROV Services
• Survey (SP)
• Tooling (SSP)
• ROV Services
• Survey (SP)
• Tooling (SSP)
• IWOCS – Installation & Workover Control Systems (SSP)
• Subsea Hardware (SSP)
• Umbilicals (SSP)
• Vessel-based Installation Services (SP)
• Inspection Services (AI)
• Seabed Preparation/ Trenching (SP)
• ROV Services
• Tooling (SSP)
• Subsea Work Systems (SSP)
• IWOCS – (SSP)
• Subsea Hardware (SSP)
• Vessel-based Installation Services (SP)
• Inspection Services (AI)
• ROV Services
• Tooling (SSP)
• Subsea Work Systems (SSP)
• IWOCS – (SSP)
Business Segment Product and Service Revenue Streams
KEY
ROV = Remotely Operated Vehicles
SSP = Subsea Products
SP = Subsea Projects
AI = Asset Integrity
Active in All Phases of the Offshore Oilfield Lifecycle
4
*Estimates as of December 31, 2017.
Five Operating Segments
5
Remotely Operated Vehicles (ROVs)
Subsea Products
Subsea Projects
Asset Integrity
Advanced Technology
Energy:
Non-Energy:
Annual Financial Overview
6
23% 20%
44% 43%
30% 33%
0
31% 30%21%
15%
0
16%13%12%
12%
0
6%6%
14%20%
0
3%8%
0%
25%
50%
75%
100%
Adtech
Asset Integrity
Subsea Projects
Subsea Products
ROV
Revenue Adjusted Operating EBITDA*
$1.9B$2.3B
2016 2017
$451.5M $322.8M
2016 2017
* Excludes Unallocated Expenses and the effects of certain specified items. For reconciliation of Adjusted Operating EBITDA to Operating Income, see the Supplemental Information.
0%
25%
50%
75%
100%
International United States Services Products
Dispersed Revenue Mix
7
Geographic Area Services and Products
43% 49%
34% 39%
66% 61%57% 51%
$2.3B $1.9B $2.3B $1.9B
2016 2017 2016 2017
Quarterly Financial Overview
8
20% 20% 23%
34% 30% 25%
15%14% 16%
11%15% 14%
20% 21% 22%
0%
25%
50%
75%
100%
2017 Q2 2018 Q1 2018 Q2
Revenue Adjusted Operating EBITDA*
45% 48% 49%
27%30% 26%
12%11%
4%
6%7%
8%
10%4%
13%
0%
25%
50%
75%
100%
2017 Q2 2018 Q1 2018 Q2
Adtech
Subsea Projects
Asset Integrity
Subsea Products
ROV
$478.7M $66.5M$87.4M $52.9M$515.0M $416.4M
* Excludes Unallocated Expenses and the effects of certain specified items. For reconciliation of Adjusted Operating EBITDA to Operating Income, see the Supplemental Information.
Third Quarter 2018 Outlook - Improved Results
Led by Subsea Projects’ return to profitability
Subsea Projects – Improved operating results, due to an increase in utilization in U.S. GOM deepwater vessel and diving services, and contribution from Ecosse
Other segment operating results flat to slightly down
ROVs – Similar operating results
Subsea Products – Slightly lower operating results
Asset Integrity – Flat to slightly lower operating results
Advanced Technologies – Flat operating results
9
Compared to the second quarter 2018
2H 2018 Outlook - Improved Revenue and Operating Income
Most improved operating results from:
Subsea Projects –due to higher levels of deepwater vessel activity at improved margins, and contributions from Ecosse
Advanced Technologies – due to increased activity driven from backlog in commercial theme park business, and improved results within AGV business
Higher operating results from:
ROVs – due to an increase in days on hire
Similar operating results from:
Subsea Products
Asset Integrity
10
Compared to the first half 2018
2018 Outlook
Updated Adjusted EBITDA Estimate:
• Adjusted EBITDA guidance range is $140 million to $160 million, with positive
operating EBITDA contributions from each operating segment
For the remainder of the year:
• Reviewing Proposed Regulations as issued by the US IRS, and will evaluate
any impact on our estimated provisional tax during the third quarter of 2018
• Unallocated Expenses to be in the upper-$20 million range per quarter
11
We provide ROVs, which are tethered submersible vehicles remotely operated from the surface, to customers in the energy industry for drilling support and vessel-based services, including subsea hardware installation, construction, pipeline inspection, survey and facilities inspection, maintenance and repair.
Remotely Operated Vehicles
23%
49%
0%
25%
50%
75%
100%
Revenue Adjusted OperatingEBITDA*
2018 Q2
12
* Excludes Unallocated Expenses.
Floating Rig Demand HistoryDrill support market share improved to 60% at June 30, 2018
13
0%
25%
50%
75%
100%
0
75
150
225
300
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
% o
f Floaters w
ith O
II RO
Vs
Co
ntr
acte
d F
loat
ing
Rig
s at
Per
iod
En
d
Contracted Floaters, Working Contracted Floaters, Not Working % of Contracted Floaters with OII ROVs
Source: Rig data, IHS Petrodata at June 30, 2018
Fleet mix was 62% in drill support and 38% in vessel-based activity for Q2 2018
Oceaneering ROV Drill Support/Vessel-Based Fleet Mix
0%
25%
50%
75%
100%
0
7,500
15,000
22,500
30,000
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
Drill Su
pp
ort / V
essel Fleet Mix
RO
V D
ays
on
Hir
e
Vessel Based Utilization Drill Support Utilization ROV Days on Hire
14
* At June 30, 3018. Based on number of actual working days.
Oceaneering ROV Days on Hire and Fleet UtilizationROV days on hire increased 24% as utilization improved to 54% during Q2 2018
15
0
7,500
15,000
22,500
30,000
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
0%
25%
50%
75%
100%
RO
V D
ays
on
Hir
e
Fleet Utilizatio
n R
ate
Drill Support Days Vessel Based Days ROV Fleet Utilization
Source: Rig data, IHS Petrodata
Oceaneering ROV Average Revenue per Day on Hire$7,900 at Q2 2018; Regional ROV pricing appears to be stabilizing
16
0%
20%
40%
60%
80%
100%
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
$0
$2,500
$5,000
$7,500
$10,000
$12,500
Ad
justed
EBITD
A M
argin
Ave
rage
Rev
enu
e p
er D
ay o
n H
ire
Revenue / Day on Hire ROV Adjusted EBITDA Margin
* At June 30, 2018
ROV TechnologiesEnabling better control and video imaging, precise tool manipulation, and adherence to industry requirements
17
E-ROV
Resident ROVTraditional ROV system
Mission support centers Stavanger (Norway), Houston (Texas), and
Morgan City (Louisiana)
Communications via 4G, fiber, and satellite
E-ROV concept winner 2017 World Oil New Horizons Idea Award
Freedom ROV Concept
E-ROV: 2018 OTC Spotlight on New Technology® Award winner
ROV – Higher Operating Results, Increase in Activity
Continue to project more days on hire
Reduced average revenue per day on hire, due to change in geographic mix
Fleet utilization in the low-to-mid 50% range
Maintain ROV market share for drill support at approximately 60%
ROV adjusted EBITDA margin at approximately 30%
18
Second half 2018 outlook versus first half 2018
While most of our subsea products
are sold, we also rent tooling, and
provide IWOCS and subsea work
systems as a service, including
hydrate remediation, riserless light
well intervention, well stimulation,
dredging, and decommissioning.
Subsea Products
19
25%
26%
0%
25%
50%
75%
100%
Revenue Adjusted OperatingEBITDA*
2018 Q2
* Excludes Unallocated Expenses.
Subsea Products
20
Production Control Umbilicals
Supply electric and hydraulic power to subsea trees and inject chemicals into reservoirs and well streams.
Specialty Subsea Hardware
Field development hardware used to connect production trees to umbilicals and flow lines. Also includes connectors and valves - Oceaneering Grayloc, Oceaneering Pipeline Connection & Repair Systems (PCRS) and Oceaneering Rotator.
50%
% of Manufactured Products Revenue to Total Subsea Products 2018 Q2 Revenue
Manufactured Products
Subsea Products
21
Installation and Workover Control Systems (IWOCS)
A temporary control system designed for both rig- and vessel-based operations used for tree installation, completion, workover, intervention and decommission of subsea wells.
Tooling and Subsea Work Systems
Provide more than 4,000 ROV tools for rental. Supports well intervention, drilling, construction, field maintenance, and plugging and abandonment activities.
50%
% of Service and Rental Revenue to Total Subsea Products 2018 Q2 Revenue
Service and Rental
Subsea Products FinancialsExpect Subsea Products book-to-bill ratio to exceed 1.0 for 2018
22
0
0.25
0.5
0.75
1
1.25
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
2017Q1
2017Q2
2017Q3
2017Q4
2018Q1
2018Q2
$0
$200
$400
$600
$800
$1,000
Bo
ok-to
-Bill R
atio, T
TM
Sub
sea
Pro
du
cts
($
in M
illio
ns)
Subsea Products Revenue Subsea Products Backlog Book-to-Bill Ratio, TTM
Book to Bill Ratio Data unavailable for Q1 2014 through Q3 2014.
Subsea Installations Forecast
23
282303
265
227201
2014 2015 2016 2017 2018F 2019F 2020F 2021F 2022F0
100
200
300
400
Sub
sea
Tree
s In
stal
led
Tree Installations Tree Installations, High Forecast Tree Installations, Average Forecast Tree Installations, Low Forecast
274Avg.
Source: Tree history data - Wood Mackenzie’s Subsea Service; Forecasts - Oceaneering
Average Forecast YoY Growth %2018F: -3%2019F: +11%2020F: -13%2021F: -14%2022F: -11%
2018 forecasts are relatively flat to 2017. 2019 Average forecast indicates slight increase.
Proven Well Access Capabilities
• IRIS and BORIS - rigless, riserless light well intervention systems
• Reliably perform in depths to 10,000 feet and pressures to 10,000 psi
• Maximize production and increase the recovery rate from offshore oil and gas reservoirs or, alternatively, prepare wells to be plugged and abandoned
24
Riserless Intervention System winner 2017 World Oil Best Well Intervention Technology Award
Subsea Products – Stronger Book-to-Bill, Similar Operating Results
Second half 2018 outlook versus first half 2018
25
Increased manufacturing activity on lower margin orders
Margins in the low-single digit range
Forecast book-to-bill to exceed 1.0
We provide project management, survey, subsea installation and inspection, maintenance, and repair services. We service deepwater projects with dynamically positioned vessels that have our ROVs onboard, and shallow water projects with our manned diving operations, utilizing dive support vessels and saturation diving systems. We also provide seabed preparation, route clearance and trenching services to the renewable energy and oil and gas industries.
Subsea Projects
26
16%
4%
0%
25%
50%
75%
100%
Revenue Adjusted OperatingEBITDA*
2018 Q2
* Excludes Unallocated Expenses.
Subsea Projects Overview
• Jones Act-compliant deepwater multi-purpose supply vessels, supplemented with short-term charters, as necessary
• Diving Support Vessels
• Survey/Autonomous Underwater Vehicles (AUV) Services
• Ecosse SCAR Seabed Systems (acquired March 2018)
• Global Data Solutions
27
Acquired Ecosse Subsea Limited
Provider of offshore engineering, seabed preparation, route clearance and trenching services
Benefits:• Expand service line capabilities
• Grow market position
• Optimize customer’s installation projects with proven tools
Accretive to 2018 cash flow and earnings
Results included in Subsea Projects segment
28
Subsea Projects – Improved Operating Results
Higher levels of deepwater vessel activity at improved margins
Increased contributions from our recent Ecosse acquisition
Ocean Evolution delivering late 2018 and placed into service during the first quarter of 2019
29
Second half 2018 outlook versus first half 2018
We provide asset integrity management, corrosion management, inspection and nondestructive testing services, principally to the oil and gas, power generation, and petrochemical industries.
Asset Integrity
30
14%
8%
0%
25%
50%
75%
100%
Revenue Adjusted OperatingEBITDA*
2018 Q2
* Excludes Unallocated Expenses.
Asset Integrity – What We DoOur optimized, industry-leading inspection services and integrity management solutions assure our customers are equipped with the data required to make informed, value-adding decisions.
31
Permanently Installed Monitoring Systems (PIMS)
Rope AccessPipeline InspectionAdvanced Inspection Services Non-Destructive Testing (NDT) – CapEx / In-Service
Subsea InspectionIntegrity ManagementInspection and Condition Monitoring
Asset Integrity – Where We WorkWe work onshore and offshore -- upstream, midstream and downstream, encompassing the entire energy spectrum, oil and gas, nuclear, and renewables.
32
Onshore Midstream Onshore Downstream Offshore Topside Offshore SubseaOnshore Upstream
Subsea InspectionIntegrity ManagementInspection and Condition Monitoring
Asset Integrity Relatively Flat Operating Results
33
Margins to be in the low- to mid-
single digit range
Continuing to respond to the needs
of our customers for a more cost-
effective method of ensuring the
integrity and availability of their
critical infrastructure.
Second half 2018 outlook versus first half 2018
We provide engineering services and related manufacturing, principally to the U.S. Department of Defense, NASA and its prime contractors, and the commercial theme park industry. We also develop, implement, and maintain innovative, turnkey logistic solutions based on automated guided vehicle technology.
Advanced Technologies
34
22%13%
0%
25%
50%
75%
100%
Revenue Adjusted OperatingEBITDA*
2018 Q2
* Excludes Unallocated Expenses.
Dry Deck Shelter Planning Yard/ Maintenance & Submarine
Maintenance
We support the U.S. Navy’s Deep Submergence community by performing complex overhauls, planned maintenance, and emergency repair tasks for the Navy’s six dry deck shelters.
U.S. Navy Submarine Rescue System
We perform major, complex overhauls, repairs, and modernization of all submarine classes forward and aft, from the top of the sail to the keel.
Entertainment Systems “Dark Ride” Vehicles
We developed and patented an evolutionary motion-based system capable of delivering high-energy thrills in fully immersive 3D media-based attractions at a fraction of the cost of other ride vehicles.
Advanced Technologies Overview
35
35
Government Businesses Commercial Businesses
Automated Guided Vehicle (AGV) Systems
We develop, implement, and maintain innovative, turnkey logistic solutions based on AGV technology.
Advanced Technologies Improved Operating Results
36
Increased activity driven from backlog in our commercial theme park business, and improved results within our automated guided vehicle business
Second half 2018 outlook versus first half 2018
Strong Balance Sheet and Liquidity
Liquidity at June 30, 2018• $340 million of cash
• $500 million undrawn unsecured revolving credit facility available until October 2021, and
$450 million available until January 2023
• Nearest loan maturity is $500 million in November 2024
Organic capital expenditures• Expect to range from $100 million to $140 million in 2018, and include $60 million to $90 million
of growth capital expenditures
Acquisitions • Continue to strengthen our portfolio of services and products by investing in our current and
adjacent market niches, with more focus on our customers’ operating expenditures
37
Future Oil Supply Short Fall Likely Due to Lack of InvestmentDue to lack of recent investment, offshore as a % of global oil supply is starting to decline; Underinvestment could significantly disrupt future global oil market supply/demand balance
38
Source: Wood Mackenzie, IEA
Shallow Water Crude Oil Supply
Deepwater Crude Oil Supply
Total Offshore % of Global Crude Supply
Key Enablers to Offshore Energy
• Shortened project development life cycles
• Reduced development costs
• Recognized efficiency gains from technology advancements
• Customer focus on developing high-graded “core of the core” offshore assets
• Customer confidence in commodity price stabilization
39
Mobile Robotics
ROVAdvanced Technologies
Subsea Projects
Riserless
Intervention & P&A
Subsea ProductsSubsea Projects
Offshore
Renewables
ROVSubsea ProductsSubsea Projects
Asset Integrity
Subsea ProductsSubsea ProjectsAsset Integrity
Pipeline Solutions
Subsea ProductsSubsea Projects
Asset Integrity
Potential Growth Areas
40
Expanding into Offshore Renewable Energy Markets
Applying existing Oceaneering technologies to provide innovative solutions to the offshore wind market
Expecting pull through in demand from integrated solutions and technologies offerings
Awarded survey services contract for Maryland Offshore Wind Project
Winner in the Carbon Trust Wind Accelerator competition• Selected for our techniques to address the inspection of
welds on monopiles and jacket foundations
Awarded three-year agreement with Van Oord Offshore Wind B.V.
• Providing ROV and trenching support services
Acquired Ecosse Subsea Limited• Providing offshore engineering, seabed preparation,
route clearance and trenching services41
Offshore Wind Global Market SizeRepresents a large investment and growth opportunity
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
2017 2018F 2019F 2020F 2021F 2022F 2023F 2024F 2025F
Cu
mu
lati
ve M
egaw
atts
Northern Europe Rest of Europe USA Rest of World
Source: Renews Global Offshore Wind Report 2017 – Nov 2017
12%
34%
20%
CAGR % from 2017
42
Conclusion
For 2018, while the overall offshore markets will continue to be challenging, we are encouraged by the early signs of improving activity in the markets and in our businesses as the industry rebounds
43
• Maintain strong balance sheet
• Invest and grow services and products portfolio
• Maintain and grow market share
• Gain efficiencies through continuous improvement
• Maintain superior safety performance or quality
Our focus:
• Innovate and solve customer’s complex problems
Supplemental Information
44
Net Income (Loss) Reconciliation to EBITDAEarnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measurement. Oceaneering’s management uses EBITDA because we believe that this measurement is a widely accepted financial indicator used by investors and analysts to analyze and compare companies on the basis of operating performance, and that this measurement may be used by some investors and others to make informed investment decisions. You should not consider EBITDA in isolation from or as a substitute for net income or cash flow measures prepared in accordance with generally accepted accounting principles or as a measure of profitability or liquidity. EBITDA calculations by one company may not be comparable to EBITDA calculations made by another company. The following table provides a reconciliation between net income (a GAAP financial measure) and EBITDA (a non-GAAP financial measure) for Oceaneering’s historical and projected results on a consolidated basis for the periods indicated:
45* Forecast Net Loss excludes Provision for Income Taxes.** For reconciliation of EBITDA to Adjusted EBITDA, see the Supplemental schedules that follow.
Period Ended 2016 2017 2018F 2018F
(USD in millions) Low* High*
Net Income (Loss) $ 24.6 $ 166.4 $(105.0) $ (85.0)
Depreciation & Amortization 250.2 213.5 215.0 215.0
Subtotal 274.8 379.9 110.0 130.0
Interest Expense/Income, Net 20.3 19.3 30.0 30.0 Income Tax Expense 18.8 (184.2) - -
EBITDA $ 313.9 $ 215.0
Adjusted EBITDA** $ 369.3 $ 222.4 $ 140.0 $ 160.0
46
Adjusted EBITDA excludes the effects of certain specified items, as set forth in the table that follows. Adjusted Operating EBITDA is Adjusted EBITDA before Unallocated Expenses. We believe these are useful measurements for investors to review because it provides a consistent measure of the underlying results of our ongoing business by individual business segment and on a consolidated basis. Furthermore, our management usesthese measurements as a measure of performance of our operations. Adjusted EBITDA and Adjusted Operating EBITDA are non-GAAP financial measures. The following table provides a reconciliation between operating income (a GAAP financial measure) and Adjusted EBITDA and Adjusted Operating EBITDA (non-GAAP financial measures) for Oceaneering’s historical results on a consolidated basis and by segment for the periods indicated.
Operating Income Reconciliation to Adjusted EBITDA and Adjusted Operating EBITDA
Year Ended Dec 30, 2016(USD in millions)
ROVSubsea
ProductsSubsea Projects
Asset Integrity
Advanced Tech.
Subtotalbefore
Unallocated Expenses
Unallocated Expenses Total
Operating Income (GAAP) $ 25.2 $ 75.9 $ 34.5 $ 7.6 $ 11.8 $ 155.0 $ (84.2) $ 70.8
Depreciation & Amortization 141.0 53.8 34.0 14.3 3.1 246.2 4.0 250.2
Other pre-tax - - - - - - (7.1) (7.1)
EBITDA $ 166.2 $ 129.7 $ 68.5 $ 21.9 $ 14.9 $ 401.2 $ (87.3) $ 313.9
Adjustments for the effects of: Inventory write-downs 25.2 5.3 - - - 30.5 - 30.5 Restructuring Expenses 3.7 3.7 2.1 1.4 0.5 11.4 0.3 11.7 Allowance for bad debts 1.2 1.9 0.3 5.0 - 8.4 - 8.4 Foreign Currency (gains)/losses - - - - - - 4.8 4.8 Total Adjustments 30.1 10.9 2.4 6.4 0.5 50.3 5.1 55.4
Adjusted EBITDA $ 196.3 $ 140.6 $ 70.9 $ 28.3 $ 15.4 $ 451.5 $ (82.2) $ 369.3
Adjusted Operating EBITDA, Segment % 44% 31% 16% 6% 3% 100%
47
Year Ended Dec 30, 2017(USD in millions)
ROVSubsea
ProductsSubsea Projects
Asset Integrity
Advanced Tech.
Subtotalbefore
Unallocated Expenses
Unallocated Expenses Total
Operating Income (GAAP) $ 22.3 $ 45.5 $ 10.3 $ 11.2 $ 22.0 $ 111.3 $ (100.7) $ 10.6
Depreciation & Amortization 114.0 52.6 31.8 7.7 3.2 209.3 4.2 213.5
Other pre-tax - - - - - - (9.1) (9.1)
EBITDA $ 136.3 $ 98.1 $ 42.1 $ 18.9 $ 25.2 $ 320.6 $ (105.6) $ 215.0
Adjustments for the effects of: Charge related to prior year non-income related taxes
1.9 0.3 - - - 2.2 - 2.2
Foreign Currency (gains)/losses - - - - - - 5.2 5.2 Total Adjustments 1.9 0.3 - - - 2.2 5.2 7.4
Adjusted EBITDA $ 138.2 $ 98.4 $ 42.1 $ 18.9 $ 25.2 $ 322.8 $ (100.4) $ 222.4
Adjusted Operating EBITDA, Segment % 43% 30% 13% 6% 8% 100%
Operating Income Reconciliation to Adjusted EBITDA and Adjusted Operating EBITDAAdjusted EBITDA excludes the effects of certain specified items, as set forth in the table that follows. Adjusted Operating EBITDA is Adjusted EBITDA before Unallocated Expenses. We believe these are useful measurements for investors to review because it provides a consistent measure of the underlying results of our ongoing business by individual business segment and on a consolidated basis. Furthermore, our management usesthese measurements as a measure of performance of our operations. Adjusted EBITDA and Adjusted Operating EBITDA are non-GAAP financial measures. The following table provides a reconciliation between operating income (a GAAP financial measure) and Adjusted EBITDA and Adjusted Operating EBITDA (non-GAAP financial measures) for Oceaneering’s historical results on a consolidated basis and by segment for the periods indicated.
48
3 mths Ended June 30, 2017(USD in millions).
ROVSubsea
ProductsSubsea Projects
Asset Integrity
Advanced Tech.
Subtotalbefore
Unallocated Expenses
Unallocated Expenses Total
Operating Income (GAAP) 10.4 10.5 3.0 3.8 7.6 $ 35.3 (25.9) $ 9.4
Depreciation & Amortization 29.0 12.8 7.8 1.7 0.8 52.1 1.1 53.2
Other pre-tax - - - - - - (0.7) (0.7)
EBITDA $ 39.4 $ 23.3 $ 10.8 $ 5.5 $ 8.4 $ 87.4 $ (25.5) $ 61.9
Adjustments for the effects of: Foreign Currency (gains)/losses - - - - - - (0.0) (0.0)Total Adjustments - - - - - - (0.0) (0.0)
Adjusted EBITDA $ 39.4 $ 23.3 $ 10.8 $ 5.5 $ 8.4 $ 87.4 $ (25.5) $ 61.9
Adjusted Operating EBITDA, Segment %
45% 27% 12% 6% 10% 100%
Operating Income Reconciliation to Adjusted EBITDA and Adjusted Operating EBITDAAdjusted EBITDA excludes the effects of certain specified items, as set forth in the table that follows. Adjusted Operating EBITDA is Adjusted EBITDA before Unallocated Expenses. We believe these are useful measurements for investors to review because it provides a consistent measure of the underlying results of our ongoing business by individual business segment and on a consolidated basis. Furthermore, our management usesthese measurements as a measure of performance of our operations. Adjusted EBITDA and Adjusted Operating EBITDA are non-GAAP financial measures. The following table provides a reconciliation between operating income (a GAAP financial measure) and Adjusted EBITDA and Adjusted Operating EBITDA (non-GAAP financial measures) for Oceaneering’s historical results on a consolidated basis and by segment for the periods indicated.
49
3 mths Ended March 30, 2018(USD in millions)
ROVSubsea
ProductsSubsea Projects
Asset Integrity
Advanced Tech.
Subtotalbefore
Unallocated Expenses
Unallocated Expenses Total
Operating Income (GAAP) (2.4) 1.8 (2.4) 1.7 1.7 $ 0.4 (27.5) $ (27.1)
Depreciation & Amortization 27.6 14.0 8.3 1.8 0.8 52.5 1.5 54.0
Other pre-tax - - - - - - (10.0) (10.0)
EBITDA $ 25.2 $ 15.8 $ 5.9 $ 3.5 $ 2.5 $ 52.9 $ (36.0) $ 16.9
Adjustments for the effects of: Foreign Currency (gains)/losses - - - - - - 8.3 8.3 Total Adjustments - - - - - - 8.3 8.3
Adjusted EBITDA $ 25.2 $ 15.8 $ 5.9 $ 3.5 $ 2.5 $ 52.9 $ (27.7) $ 25.2
Adjusted Operating EBITDA, Segment %
48% 30% 11% 7% 4% 100%
Operating Income Reconciliation to Adjusted EBITDA and Adjusted Operating EBITDAAdjusted EBITDA excludes the effects of certain specified items, as set forth in the table that follows. Adjusted Operating EBITDA is Adjusted EBITDA before Unallocated Expenses. We believe these are useful measurements for investors to review because it provides a consistent measure of the underlying results of our ongoing business by individual business segment and on a consolidated basis. Furthermore, our management usesthese measurements as a measure of performance of our operations. Adjusted EBITDA and Adjusted Operating EBITDA are non-GAAP financial measures. The following table provides a reconciliation between operating income (a GAAP financial measure) and Adjusted EBITDA and Adjusted Operating EBITDA (non-GAAP financial measures) for Oceaneering’s historical results on a consolidated basis and by segment for the periods indicated.
50
3 mths Ended June 30, 2018(USD in millions)
ROVSubsea
ProductsSubsea Projects
Asset Integrity
Advanced Tech.
Subtotalbefore
Unallocated Expenses
Unallocated Expenses Total
Operating Income (GAAP) 4.5 2.3 (10.4) 3.4 7.9 $ 7.7 (27.3) $ (19.6)Depreciation & Amortization 28.3 14.9 13.1 1.8 0.7 58.8 1.0 59.8 Other pre-tax - - - - - - (4.6) (4.6)
EBITDA $ 32.8 $ 17.2 $ 2.7 $ 5.2 $ 8.6 $ 66.5 $ (30.9) $ 35.6
Adjustments for the effects of: Foreign Currency (gains)/losses - - - - - - 3.4 3.4 Total Adjustments - - - - - - 3.4 3.4
Adjusted EBITDA $ 32.8 $ 17.2 $ 2.7 $ 5.2 $ 8.6 $ 66.5 $ (27.5) $ 39.0
Adjusted Operating EBITDA, Segment %
49% 26% 4% 8% 13% 100%
Operating Income Reconciliation to Adjusted EBITDA and Adjusted Operating EBITDAAdjusted EBITDA excludes the effects of certain specified items, as set forth in the table that follows. Adjusted Operating EBITDA is Adjusted EBITDA before Unallocated Expenses. We believe these are useful measurements for investors to review because it provides a consistent measure of the underlying results of our ongoing business by individual business segment and on a consolidated basis. Furthermore, our management usesthese measurements as a measure of performance of our operations. Adjusted EBITDA and Adjusted Operating EBITDA are non-GAAP financial measures. The following table provides a reconciliation between operating income (a GAAP financial measure) and Adjusted EBITDA and Adjusted Operating EBITDA (non-GAAP financial measures) for Oceaneering’s historical results on a consolidated basis and by segment for the periods indicated.
Free Cash Flow“Free Cash Flow” (FCF) is a non-GAAP financial measurement. FCF represents cash flow provided by operating activities less organic capital expenditures (i.e., purchases of property and equipment other than those in business acquisitions). Management believes that this is an important measure because it represents funds available to reduce debt and pursue opportunities that enhance shareholder value, such as making acquisitions and returning cash to shareholders through dividends or share repurchases.
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Period Ended 2014 2015 2016 2017 1H(USD in millions) 2018
Net Income $ 428.3 $ 231.0 $ 24.6 $ 166.4 $ (82.2)Depreciation & Amortization 229.8 241.2 250.2 213.5 114.0 Other Changes in Cash Provided by Operating Activities 63.7 91.7 64.6 (243.4) (16.1)Cash Provided by Operating Activities 721.8 563.9 339.4 136.5 15.7 Purchases of Property & Equipment (386.9) (200.0) (112.4) (93.7) (53.5)
Free Cash Flow $ 334.9 $ 363.9 $ 227.0 $ 42.8 $ (37.8)
Oceaneering ROV Fleet – 279 ROVsGeographic profile – June 30, 2018
52
73
44
86
2428
24
25 18 42 11 3 90
10
20
30
40
50
60
70
80
90
100
GOM Africa North Sea Brazil Asia/Pac Other
RO
Vs
ROV Count Vessel Based, 108
Oceaneering ROV Leading Market Position
53
27928%
OII Subsea 7 Fugro DOF Subsea C-Innovations Helix Saipem TMT Technip IKM Group Other
9260%
Ownership Drill Support Market Share*
Source: ROV Ownership - Infield, A Wood Mackenzie Business, December 31, 2017. *At June 30, 2018
Over 6,500 on-stream wells installed offshore prior to 2018; averaging 12 years since start-up
3391,229 2,528 3,418 3,4824
285
1,698
3,141 3,238
0
1,500
3,000
4,500
6,000
7,500
pre 1990 1990s 2000s 2010-2017 2018F +
0
10
20
30
40
50
Co
un
t o
f In
stal
led
Wel
ls, o
n s
trea
m
Average Years sin
ce start-up
of o
n stream
Wells
Shelf Wells ≥400M Wells Average Age, >400M Average Age, Shelf
Global Offshore Infrastructure is Aging
54
Source: Well data - Infield, A Wood Mackenzie Business, June 2018.
623 1,136 1,173
180
561
1,038 1,062
397
729 751
0
500
1,000
1,500
2,000
2,500
3,000
3,500
pre 1990 1990s 2000s 2010-2017 2018F +
0
10
20
30
40
50
Co
un
t o
f In
stal
led
Wel
ls, o
n s
trea
m
Average Years sin
ce start-up
of o
n stream
Wells
Africa Asia Australia Europe/N Sea America, South/Latin MidEast/Caspian America, North
Global Offshore Infrastructure is Aging
55
Source: Well data - Infield, A Wood Mackenzie Business, June 2018. *Deepwater is ≥ 400 meters
Over 3,100 on-stream wells installed in deepwater* prior to 2018; averaging 9 years since start-up
3,141
1,698
285
4
3,238
180531
970 992182
296 301186
366 373
134
267 272
87
261 276
41
236
368 377
0
500
1,000
1,500
2,000
2,500
3,000
3,500
pre 1990 1990s 2000s 2010-2017 2018F +
0
10
20
30
40
50
Co
un
t o
f In
stal
led
Wel
ls, o
n s
trea
m
Average Years sin
ce start-up
of o
n stream
Wells
Petrobras ExxonMobil BP Total/TotalQatar Shell Chevron Anadarko Eni LLOG,Murphy,ENGC,BHP,Tullow Other
Global Offshore Infrastructure is Aging
56
Source: Well data - Infield, A Wood Mackenzie Business, June 2018. *Deepwater is ≥ 400 meters
Over 3,100 on-stream wells installed in deepwater* prior to 2018; averaging 9 years since start-up
1,698
285
4
3,1413,238
Investor Relations ContactSuzanne SperaDirector, Investor [email protected]
57
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