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May 2015 Investor Presentation – Hornbeck Offshore

Hornbeck Offshore · May 11, 2015 · 51 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. May 2015 Investor Presentation – Hornbeck Offshore – slide 1
    Todd M. Hornbeck Chairman, President & CEO Investor Presentation James O. Harp, Jr. May 2015 Executive VP & CFO
  2. May 2015 Investor Presentation – Hornbeck Offshore – slide 2
    Company Profile Financial Highlights Relative Stock Price Performance (IPO to 30-Apr-2015) 3 Daily Trading Volume (000s) Year Founded Jun 1997 400% 6,000 Year of IPO Mar 2004 350% HOS 5,000 300% Market Cap Inception 1m Russell…
  3. May 2015 Investor Presentation – Hornbeck Offshore – slide 3
    Investment Considerations Young One of the youngest fleets in the industry with an average age of seven years Technologically Multi-class Upstream fleet capable of servicing our customers needs from cradle-to-grave Advanced Fleet New…
  4. May 2015 Investor Presentation – Hornbeck Offshore – slide 4
    Financial Highlights
  5. May 2015 Investor Presentation – Hornbeck Offshore – slide 5
    Strong Track Record of Growth 700 400 Revenue EBITDA1 600 350 500 300 250 400 200 300 150 200 100 100 50 0 0 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 OSV Barge…
  6. May 2015 Investor Presentation – Hornbeck Offshore – slide 6
    Industry Leading OSV Margins Gross Margin 15-year Average 85.0% 75.0% HOS OSVs = 62% 65.0% Hornbeck OSVs OSV Peers = 42% 55.0% 45.0% 1Q2015 35.0% HOS OSVs = 54% 25.0% OSV Peers = 28% OSV Peer Group HOS Operating Margin…
  7. May 2015 Investor Presentation – Hornbeck Offshore – slide 7
    HOS vs. Public Domestic OSV Peers Dayrates Utilization 30,000 100% Pre-Macondo Avg Average Dayrate 92% 26,000 90% Effective Dayrate 15-yr Average 22,000 80% Hornbeck 18,000 15-yr Effective 70% Hornbeck 14,000 60% 15-yr Average…
  8. May 2015 Investor Presentation – Hornbeck Offshore – slide 8
    Compounded Reinvestment of Free Cash Flow 700.0m 1.2 billion in 1.3 billion in growth growth capex and other capex to be 600.0m invested from invested from 2011 to 490 2007 to 2010 2016 1 460 500.0m 423 316 400.0m 234 340…
  9. May 2015 Investor Presentation – Hornbeck Offshore – slide 9
    300 Class OSV Deliveries Will Drive Earnings Power 2012 2013 2014 2015 Current Fleet 2013 Deliveries SSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSSS 2014 Deliveries…
  10. May 2015 Investor Presentation – Hornbeck Offshore – slide 10
    Historical Average Dayrate per Deadweight Ton (DWT) Low-Spec Vessel Avg Dayrate per DWT High-Spec Vessel Avg Dayrate per DWT Since 2007, HOS low-spec average dayrates per DWT have ranged between 6 and 10, with an average of 8 This…
  11. May 2015 Investor Presentation – Hornbeck Offshore – slide 11
    Pro Forma Run-Rate EBITDA Illustration Implied 800 Cash EPS: Implied 15.76 700 Cash EPS: 685 10.24 600 Implied Cash EPS: 485 500 365 5.13 400 556 300 270 300 356 200 185 171 320 100 215 115 - Low Case Mid Case High…
  12. May 2015 Investor Presentation – Hornbeck Offshore – slide 12
    Highly Attractive Multiples of Cash EPS with Upside 18 Significant Macondo Implied Upside to Multiple of Cash 15.76 16 incident and Multiple of resulting Cash EPS of EPS…
  13. May 2015 Investor Presentation – Hornbeck Offshore – slide 13
    Long-Term Balance Sheet and Ample Liquidity Recent HOS Financings: 3,000 A = Follow-on Equity Offering in Nov-2011 B = Refinancing of 6.125% Senior Notes due 2014 with 5.875% Senior Notes due 2020 in Mar-2012 C = Refinancing of…
  14. May 2015 Investor Presentation – Hornbeck Offshore – slide 14
    No Maturities of Funded Debt until 2019 6.125% Notes were refinanced with 5.875% 6.125% Senior Notes in Mar-2012 Notes due 2014 5.875% Senior Notes due 2020 1.625% Notes were retired in Nov-2013 with 1.625% Convertible 1.500%…
  15. May 2015 Investor Presentation – Hornbeck Offshore – slide 15
    Strong Asset Coverage to Net Debt 3,500 4.1x 3,304 3,000 3.5x 2,778 2,500 3.0x 2,421 2,000 1,500 1,000 797 Net Debt 4 500 0 Replacement Cost 1 Fair Market Value 2 Net Book Value 3 1 Represents current internal…
  16. May 2015 Investor Presentation – Hornbeck Offshore – slide 16
    Current TEV Substantially Below Intrinsic Vessel Values Average Values per Vessel 170.0m 160.0m 150.0m 140.0m 130.0m 120.0m 110.0m 100.0m 90.0m 80.0m 70.0m 60.0m 50.0m 40.0m 30.0m 20.0m 10.0m 0.0m 5 5 Low Spec High…
  17. May 2015 Investor Presentation – Hornbeck Offshore – slide 17
    HOS Price-Book Ratio Well Below NBV per Share Net Debt Market Cap Price to-Book Ratio Since 2004, the HOS price-to-book ratio has traded in broad range of 40% to 400% of NBV Since its IPO in Mar 2004, HOS has traded at an average…
  18. May 2015 Investor Presentation – Hornbeck Offshore – slide 18
    Relative Trading Volume L3M Trading Volume (shares) to Floating Market Cap Ratio 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% TDW CKH GLF HOS HOS = 5.2% OSV Peer Mean = 2.2% TDW CKH GLF HOS L3M Share Volume 1,305,450 151,287 748,160…
  19. May 2015 Investor Presentation – Hornbeck Offshore – slide 19
    Company Overview 20
  20. May 2015 Investor Presentation – Hornbeck Offshore – slide 20
    Diversified Oilfield Marine Service Provider Offshore Supply Vessels Multi-Purpose Service Vessels HOS Cornerstone approaching the drillship GSF CR Luigs. HOS Iron Horse performing subsea support services. 58 Existing New Gen…
  21. May 2015 Investor Presentation – Hornbeck Offshore – slide 21
    Recent Sale of Military Vessels Recently agreed to sell four 250EDF class OSVs that were chartered to the U.S. Navy for 152m (38m each) These vessels have supported the U.S. submarine fleet on the east and west coast of the U.S.…
  22. May 2015 Investor Presentation – Hornbeck Offshore – slide 22
    Market Diversification Strategy1 By Geographic Area By Service-Offering Military Service Port Services Other Intl Contract East Coast West Coast Latin Oilfield America GoM Specialty Oilfield Supply 5 Geographic Markets…
  23. May 2015 Investor Presentation – Hornbeck Offshore – slide 23
    Our Core Markets: GoM, Mexico and Brazil Non-Oilfield service West Coast Oilfield service 1 OSV Company locations East Coast 1 OSV Gulf of Mexico Europe/ 19 OSVs Caribbean Middle East 5 MPSVs 2 OSVs 1 OSV 1 MPSV Mexico…
  24. May 2015 Investor Presentation – Hornbeck Offshore – slide 24
    Top 3 Operator of New Gen OSVs Worldwide By Location By Competitor (by DWT) (by DWT) HOS is 3 HOS Core out of 194 Markets = 40% companies Med 2% ANZ 2% of WW Supply Indian Ocean Other 2% 3% Middle East Other 2% South 60%…
  25. May 2015 Investor Presentation – Hornbeck Offshore – slide 25
    Top 3 Operator of Hi-Spec OSVs Worldwide and in the GoM 3 Operator Worldwide 2 Operator in the GoM (Jones Act) (Pro Forma Hi-Spec Fleet1 by DWT) (Pro Forma Hi-Spec Fleet1 by DWT) Siem Aries Bordelon Laborde Offshore Marine Odyssea…
  26. May 2015 Investor Presentation – Hornbeck Offshore – slide 26
    Top 2 Operator of 300 Class OSVs Worldwide and in the GoM 2 Operator Worldwide 1 Operator in the GoM (Jones Act) (Pro Forma 300 Class Fleet1 by DWT) (Pro Forma 300 Class Fleet1 by DWT) GulfMark Otto Candies 2% Harvey Gulf Tidewater…
  27. May 2015 Investor Presentation – Hornbeck Offshore – slide 27
    Well-Balanced Blue Chip Customer Base 2015E Upstream Revenue 2015E Upstream Revenue By Customer Type By Customer Credit Rating Integrated Oil AA Companies 25% A 55% 23% National Oil Companies AAA 14% Oilfield 28% BBB U.S.…
  28. May 2015 Investor Presentation – Hornbeck Offshore – slide 28
    Safety Record Outperforms Industry Benchmarks Recordable Incident Rates (RIR) 3 12,000,000 2.5 10,000,000 2 8,000,000 1.5 6,000,000 1 4,000,000 0.5 2,000,000 0 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010…
  29. May 2015 Investor Presentation – Hornbeck Offshore – slide 29
    Upstream Macro Overview
  30. May 2015 Investor Presentation – Hornbeck Offshore – slide 30
    Depletion Curve to Drive the Drill Bit 140,000 120,000 100,000 Replacement Need Mbbl per day 80,000 60,000 40,000 20,000 Existing Supply 0 2013 2016 2019 2022 2025 2028 2031 2034 2037 2040 Source: IEO 2014,…
  31. May 2015 Investor Presentation – Hornbeck Offshore – slide 31
    Deepwater Trend Driving Upstream Segment Deepwater GoM Production % of Total U.S. Offshore Production from Deepwater 90.0 Oil Prod 80.0 Gas Prod 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 1985 1987 1989 1991 1993 1995 1997…
  32. May 2015 Investor Presentation – Hornbeck Offshore – slide 32
    Deepwater E&P Demand Drivers Deepwater and ultra-deepwater exploration and production infrastructure Courtesy of: Clarkson Research Services Limited UK (www.crsl.com). 33
  33. May 2015 Investor Presentation – Hornbeck Offshore – slide 33
    Newbuild Floaters Built for Ultra-Deepwater Drilling Newbuild Floaters By Delivery Date Floating Rig Fleet by Rated Water Depth 90 80 5 70 9 60 17 50 40 80 27 30 20 10 22 0 2015E 2016E 2017E 2018E After Total 2018E Source:…
  34. May 2015 Investor Presentation – Hornbeck Offshore – slide 34
    Deepwater Wells are Being Drilled to Greater Depths Gulf of Mexico Well Depths Source: BSEE. Well Depth defined as True Vertical Depth Average deepwater well depths in the GoM have increased from 10k feet in 1993 to nearly 20k…
  35. May 2015 Investor Presentation – Hornbeck Offshore – slide 35
    Deepwater Wells are Greater Distances From Shore Brazil Espirito Santo Basin New Orleans Corpus Christi Albacora Leste Discovery 75 miles/6 hours Macae Marlim Leste Discovery 70 miles/6 hours Gunnison Big Foot Rio de Janeiro…
  36. May 2015 Investor Presentation – Hornbeck Offshore – slide 36
    Mexico Overview
  37. May 2015 Investor Presentation – Hornbeck Offshore – slide 37
    Mexico Energy Reform Passage of Constitutional Passage of Secondary Round Zero, Joint Ventures, Regulatory Round One Tenders and Pemex Joint Reform Legislation Organizations Ventures Aug 2013-Dec 2013 Apr 2014-Aug 2014…
  38. May 2015 Investor Presentation – Hornbeck Offshore – slide 38
    Mexicos Deepwater Potential Over 50% of the 53 billion barrels of conventional prospective resources are in deepwater Pemex granted 83% of 2P Reserves and 21% of total Prospective Resources in Round Zero Round Zero decision…
  39. May 2015 Investor Presentation – Hornbeck Offshore – slide 39
    U.S.-Mexico Transboundary Agreement Removes uncertainties regarding development of resources that cross the U.S.-Mexico maritime boundary Nearly 1.5 million acres containing 172 million bbls of oil and 304 billion ft3 of natural…
  40. May 2015 Investor Presentation – Hornbeck Offshore – slide 40
    Top Operator of New Gen OSVs in Mexico 1 New Gen OSV Operator in Mexico (Pro Forma by DWT) Otto Candies 5% Naviera 3% POSH Semco 4% Cotemar 5% Aries Seacor Marine 3% Marine 14% Other 22% Oceanografia 7% Tidewater 12%…
  41. May 2015 Investor Presentation – Hornbeck Offshore – slide 41
    Hornbeck Offshore Steady Growth in Mexico Average Vessels in Mexico Total Mexico Revenue 14.0 100,000 90,000 12.0 80,000 10.0 70,000 Avg. Vessel Count in thousands 60,000 8.0 50,000 6.0 40,000 4.0 30,000 20,000…
  42. May 2015 Investor Presentation – Hornbeck Offshore – slide 42
    Project Spartan OSV Newbuild Program 5
  43. May 2015 Investor Presentation – Hornbeck Offshore – slide 43
    Here We Grow Again Pro Forma 2016 Fleet1 2010 Fleet 39% 5% 2005 Fleet 39% 2000 Fleet 7% 23% 21% 37% 30% 11% 50% 3% 20% 100%…
  44. May 2015 Investor Presentation – Hornbeck Offshore – slide 44
    Multi-Class Upstream Fleet Profile Newbuilds Note: Legend OSV Class DWT Acquisitions Conventional Under 1,500 Current Newbuilds 200 (Low-Spec) 1,500 2,500 Upstream Fleet 240/280 (High-Spec) 2,500 5,000 64 Existing 300 (Ultra…
  45. May 2015 Investor Presentation – Hornbeck Offshore – slide 45
    Strategic Newbuild Program: 300 Class OSVs HOS 200 Class OSV HOS constructing 18 Jones Act-qualified 300 class DP-2 high-spec OSVs These vessels will have an average of 6,000 DWT and 20,000 barrels of liquid mud carrying…
  46. May 2015 Investor Presentation – Hornbeck Offshore – slide 46
    Strategic Newbuild Program: 300 Class MPSVs HOS 200 Class OSV HOS constructing six Jones Act-qualified HOSMAX 310 Class DP-2 MPSVs Five HOSMAX MPSVs will have a 150T-250T AHC KB crane, helideck, and two ROV docking stations…
  47. May 2015 Investor Presentation – Hornbeck Offshore – slide 47
    HOSMAX 310 Class MPSV 48
  48. May 2015 Investor Presentation – Hornbeck Offshore – slide 48
    HOS 300 Newbuild Pricing Globally Competitive 18,000 17,021 16,000 14,760 14,000 12,740 11,486 11,571 11,667 11,375 12,000 11,111 10,980 10,554 10,000 9,598 9,111 8,943 /DWT 7,500 8,173 8,000 6,000 4,000…
  49. May 2015 Investor Presentation – Hornbeck Offshore – slide 49
    Investment Considerations Young One of the youngest fleets in the industry with an average age of seven years Technologically Multi-class Upstream fleet capable of servicing our customers needs from cradle-to-grave Advanced Fleet New…
  50. May 2015 Investor Presentation – Hornbeck Offshore – slide 50
    Todd M. Hornbeck Chairman, President & CEO Investor Presentation James O. Harp, Jr. May 2015 Executive VP & CFO
  51. May 2015 Investor Presentation – Hornbeck Offshore – slide 51
    Appendix

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