Ocean Rig UDW Inc. 1st Quarter Ended March 31, 2015 Earnings Presentation NASDAQ: OCEAN RIG UDW INC. ORIG May 12, 2015
Q1 2015 financial results Net Revenue from drilling contracts: 402.1 million Adjusted EBITDA: 219.0 million Net Income: 41.1 million or 0.31 per share OCEAN RIG UDW INC. 3
Key highlights Achieved approximately 99% average fleet wide operating performance for the first quarter Completed mobilization and acceptance testing of Ocean Rig Apollo in record time (54 days since sailing from the shipyard)…
Solid backlog insulates ORIG from market softness Ocean Rigs fleet is 88% contracted in 2015 and 69% contracted in 2016 Revenue Backlog & Weighted Average Contracted Dayrate Backlog million Contracted dayrate 1,800 600,000 594,228…
Operational & Financial Highlights OCEAN RIG UDW INC.
Solid multi-year fleet employment profile Average contract remaining fixed period of 2.3 years, 3.8 years with options 88%, 69% calendar days under contract in 2015 and 2016 respectively 4.7 billion revenue backlog Rem. 2015 2016…
Q1 2015- Revenue and operating expenses summary During the quarter, we had 836 calendar days of which 112 days were uncontracted and 77 days were spent on mobilization Resulting in 647 available contracted drilling days, of which 641…
Income Statement (Expressed in Millions of U.S. Dollars except for share and per share data) Q1 2015 REVENUES: Drilling revenues, net 365.1 Amortization of deferred revenue 37.0 Total Revenues from drilling contracts 402.1…
Solid Balance Sheet Weighted average debt maturity of 4.9 years No near-term maturities; next significant maturity in Q4 2017 Free cash: 509.3 million DFHI Term Loan 7.25% Unsecured 6.50% Secured DOV Term Loan B Commercial Bank B-1…
Managing our capital expenditure program 312 million equity invested for our three newbuildings through Q1 2015 Ocean Rig Crete and Ocean Rig Amorgos deliveries pushed back to Q1 2018 and Q1 2019 respectively Current1 construction…
Industry Overview OCEAN RIG UDW INC.
2014/5: Years of volatility Price of oil Decline in the price of oil has caught the market by surprise Price instability and diverging industry projections of future oil price have magnified market concerns E&P spending…
Supply and Demand dynamics Supply Demand Modern floaters: Oil companies still committed to drilling offer more drilling options to customers drill up to 40% faster Project costs will come down Older floaters unable to secure…
Modern floaters offer more drilling options to customers Modern units have more deck space Modern units have space for more people Variable deck load (000s short tons) Accommodation Capacity 18.0 22.4 200 182 216 15.9 16.0 180 14.0…
Modern floaters can reduce drilling times by up to 40% Modern floaters outperform older units 100.0% 100% Besides drilling safer, modern units also drill faster due to 90% the following characteristics: 80% Dual activity…
Scrapping of older floaters has accelerated Over 10% of floater fleet scrapped in last 9 months 30 25 Market weakness has accelerated scrapping activity of 20 older units 20 16 20 units scrapped last 5 months, including a…
Older units unable to secure new contracts more stacking and scrapping Floaters utilization 100.0% 95.0% 90.0% Since the start of the downcycle, utilization of older units has 85.0% decreased to below 70% 80.0% 75.0% This decrease…
Stacking and scrapping of older units will continue to accelerate 56 Idled/Stacked floater units units 160 144 138 9 140 22 120 100 80 14% (22 units) of older floaters are cold stacked 60 14% (22 units) of older floaters are…
Opportunity for a reduced floater fleet Potential Fleet Development units 400 77 (20) (1) 350 339 (22) (27) 300 282 (37)(2) 253 250 200 150 100 50 0 Active floater fleet Units under Doubtful units Long term…
Oil companies still committed to drilling Major Projects with impending FIDs Project O perator Location Greater W estern Flank Phase 2 W oodside Australia Liwan Phase 2 Husky China R-Series Reliance India Sankofa ENI Ghana Bonga…
Project costs will come down Example: Totals Kaombo Project Project costs are coming down in drilling, oil services and subsea services Totals Kaombo Project: Project costs cut by 20% (4B) through a mix of: - 20% Conversions…
Wildcards 1. Brazil 2. Mexico 3. Arctic Petrobras has been consistently Deepwater activity non-existent Russian Arctic and Chuckchi operations: underperforming in production. on the Mexican side of GoM. Blocked due to imposed…
Think positive As the oil industry rebalances itself, drilling activity will pick up if the oil price also goes up we could see a Ketchup effect OCEAN RIG UDW INC. 25
Closing Remarks OCEAN RIG UDW INC.
Closing remarks Attractive portfolio of modern drilling units Fleet of 11 modern (6th and 7th generation) UDW drillships and 2 UDW harsh environment semi-submersible rigs Premium high specification standardized assets Value…
Appendix OCEAN RIG UDW INC.
Pure-play ultra-deepwater driller with premium assets Harsh environment UDW semis Sister drillships provide benefits from standardization Optimized for development drilling 5th generation semisubmersibles Four 6th and five 7th…
Healthy liquidity & capital structure (in million) March 31, Ownership on May 12, 2015 2015 Shares Outstanding 132.0 million Total cash 520.6 Senior Secured Term Loan B Facility(1) 1,264.1 Free float shares 53.7 million B-1 Term…
Fleet status report Date: 12-May-15 Estimated Mobilization Days Expected Idle & Off-hire Days Year Built / Estimated Estimated Expected Commencement Completion 2015 2015 Footnote UDW Unit Name Delivery Location Customer Date Date…
Projected deferred revenue & expense amortization As of May 4, 2015 (USD million) Q1A 2015 Q2E 2015 Q3E 2015 Q4E 2015 FY 2015 Amortization of deferred revenues 37.0 57.4 52.4 45.2 192.1 Amortization of deferred expenses 22.6 24.0…
Balance Sheet (Expressed in Thousands of U.S. Dollars) December 31, 2014 March 31, 2015 ASSETS Cash, cash equivalents and restricted cash (current and non-current) 531,497 520,597 Other current assets 446,695 592,754 Advances…
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