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Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS)

Petroleum Geo Services (PGS) · Feb 13, 2014 · 34 slides

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Slides

  1. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 1
    Unaudited Third Quarter 2013 Results Unaudited Fourth Quarter and Preliminary Full Year 2013 Results Oslo, February 13, 2014 Oslo, October 25, 2013
  2. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 2
    Cautionary Statement This presentation contains forward looking information Forward looking information is based on management assumptions and analyses Actual experience may differ, and those differences may be material Forward…
  3. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 3
    Improved Profitability 2013 financial performance: EBIT of USD 382.1 million. A margin of 25% CF from operations of USD 775.3 million EPS of USD 1.11, up 29% from 2012 Record MultiClient late sales revenues Successful…
  4. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 4
    Financial Summary Revenues EBITDA* 250 246 405 360 400 388 382 222 216 365 366 359 210 360 202 201 340 345 327 200 300 164 162 153 USD million 150 145 146 USD million 200 100 73 100 50 - - EBIT** Cash…
  5. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 5
    Strong Order Book 800 700 Order book of USD 669 600 million by the end of Q4 2013 500 USD million 400 Vessel booking* 100% booked for Q1 2014 300 90% booked for Q2 2014 65% booked for Q3 2014 200 20% booked for Q4…
  6. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 6
    2008 2015 First Phase of the Industrial Approach: Performance Through the Cycle - Getting it Right 3D fleet renewal and growth Average vessel age reduced from 16.2 to 9.2 years Average streamer per vessel increased from 8.5 to 12.9…
  7. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 7
    2016 and Beyond: Becoming Fully Industrialized Financial focus on profit, free cash flow and ROCE - not vessel market share growth Leveraging GeoStreamer equipped fleet and increased productivity differentiation Continued…
  8. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 8
    Investing in a Growth Case 4.0 EPS gaining momentum 3.5 EPS growth in focus going 3.0 forward 2.5 EPS 2.0 Good potential for further growth 1.5 in profitability from current levels 1.0 0.5 Dividend growth will be a…
  9. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 9
    Ramform Titan-class Delivers Attractive Returns The Ramform Titan meeting expectations: Performance and efficiency Ability to fully exploit GeoStreamer technology Safety Crew comfort With current contract performance through…
  10. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 10
    Financials Unaudited Fourth Quarter and Preliminary Full year 2013 Results
  11. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 11
    Condensed Consolidated Statement of Operations Summary Q4 Q4 Full year Full year USD million (except per share data) 2013 2012 % change 2013 2012 % change Revenues 359.5 360.1 0% 1501.6 1518.3 -1 % EBITDA* 201.0 162.2 24 % 828.9…
  12. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 12
    Non Recurring Items Impacting Q4 2013 USD 15 million impairment of source vessel Polar Sea Net financial items impacted by USD 5 million write down of associated companies Tax rate of 33% in Q4 2013, higher than trend line - No…
  13. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 13
    Q4 2013 Highlights Contract revenues MultiClient revenues 250.0 80 % 250 % 207.3 70 % 192.8 200 85.9 200.0 200 % 165.4 60 % 174.9 164.9 163.8 158.6 156.3 155.7 65.7 USD million 50 % 150 USD million 150.0 138.1 69.6…
  14. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 14
    MultiClient Revenues per Region Pre-funding and Late Sales Revenues Combined 250 Q4 2013: Pre-funding revenues were 200 highest in South America, Africa and Asia Pacific Strong late sales in Europe, 150 South America and North…
  15. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 15
    Vessel Utilization Seismic Streamer 3D Fleet Activity in Streamer Months 100 % Q1 2014 will see 90 % seasonal effect of moving 80 % vessels into the North Sea and steaming of 70 % Ramform Atlas from 60 % Japan to Europe 50 %…
  16. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 16
    Key Operational Figures 2013 2012 USD million Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Contract revenues 121.7 155.7 192.8 207.3 156.3 163.8 128.5 174.9 MultiClient Pre-funding 94.3 108.4 65.2 92.6 81.4 121.3 150.2 108.5 MultiClient Late sales 99.2…
  17. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 17
    Group Cost* Development 300 272 271 270 268 265 250 248 240 252 241 Cost focus delivering results 231 228 214 200 Flat cost development from Q4 2012 despite Ramform USD million 150 Titan in full operation 100 Q4…
  18. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 18
    Consolidated Statements of Cash Flows Summary Q4 Q4 Full year Full year USD million 2013 2012 2013 2012 Cash provided by operating activities 211.9 163.6 775.3 752.9 Investment in MultiClient library (111.0) (71.3) (373.0) (297.4)…
  19. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 19
    Strong Balance Sheet Position - Key Figures December 31 December 31 USD million 2013 2012 Total assets 3 544.3 3 275.6 MultiClient Library 576.9 382.3 Shareholders' equity 2 065.6 1 911.5 Cash and cash equiv. 263.8 390.3…
  20. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 20
    Operational Update and Market Comments Unaudited Fourth Quarter and Preliminary Full year 2013 Results
  21. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 21
    Streamer Operations February 2014 Atlantic Explorer Ramform Sovereign (North Sea) Ramform Valiant PGS Apollo Ramform Explorer Pacific Explorer (Myanmar) Nordic Explorer (GoM) Ramform Atlas Ramform Challenger (Steaming to…
  22. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 22
    Bidding Activity 3 500 3 000 Increase in All Sales Leads 2 500 Expected to impact the Active Tenders positively USD million 2 000 Industry order book duration 1 500 significantly increased 1 000 Survey size continues…
  23. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 23
    Global Supply and Demand Trends 600 Total 3D volume in '000 of sq. km 500 Growth in sq.km. flattened out from 400 2012 to 2013 300 From 2006 to end 2013 demand for 200 seismic grew by approximately 100 120% measured in…
  24. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 24
    PGS Strategic Ambition To Care For our employees For the environment and society at large For our customers success To Deliver Productivity Leadership Ramform platform + GeoStreamer Reducing project turnaround time To Develop…
  25. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 25
    Good MultiClient Sales Performance from All Vintages 900 800 Strong sales progress for all 700 vintages 600 Moderate net book values (NBV) for surveys completed 2008- USD Millions 500 2013 400 Amortization is…
  26. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 26
    Market Outlook Sustainable high oil price Deep water attractive for E&Ps Playing to PGS strengths Customer focus on preserving dividend capacity Pricing for booked 2014 work is unchanged from average 2013 level, with the…
  27. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 27
    2014 Guidance EBITDA in the range of USD 900-950 million MultiClient cash investments of approximately USD 350 million Pre-funding level of approximately 100% Capital expenditures of approximately USD 450 million Adjusted to…
  28. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 28
    2013 In Conclusion: A Well Positioned Focused Marine Seismic Company Improving profitability Record MultiClient late sales revenues Increasing financial flexibility Continuously focusing on cost, quality and returns Proposed a…
  29. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 29
    Thank you Questions
  30. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 30
    Appendix: Continuously Ahead of Competition 1992 - 1996 1998 - 1999 2007 - 2009 2012 - 2014 Competition 4 6 streamers 6 8 streamers 8 - 12 streamers 10 - 20 streamers PGS 8 - 12 streamers 12 - 18 streamers 12 22 streamers 14…
  31. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 31
    Favorably Positioned on the Industry Cost Curve Relative cash cost efficiency per streamer per day PGS fleet is positioned to generate the industrys best margins Source: The cash cost curve is based on PGS internal estimates and…
  32. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 32
    The PGS Fleet: Delivers Productivity Leadership Ramforms Other vessels Ramform fleet is Titan-class improving further Ramform Titan Ramform Atlas 2 Titan Class for 2015 delivery PGS Apollo with 4 new Titan- class vessels…
  33. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 33
    Main Yard Stays Next 6 Months Vessel When Expected Type of Yard Stay Duration Ramform March 2014 Approximately Upgrade to Sovereign 10 days GeoStreamers Ramform April 2014 Approximately Renewal class Vanguard 20 days Ramform…
  34. Q4 2013 EARNINGS CALL – Petroleum Geo Services (PGS) – slide 34
    Attractive Debt Structure Long term Credit Lines and Interest Nominal Total Financial Covenants Bearing Debt Amount at Credit Line December 31, 2013 USD 470.5 million Term Loan (TLB), Libor + USD 470.5 None, but incurrence 175 basis…

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