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JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore

Hornbeck Offshore · Jun 23, 2015 · 48 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. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 1
    Todd M. Hornbeck Chairman, President & CEO Investor Presentation James O. Harp, Jr. June 2015 Executive VP & CFO
  2. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 2
    Company Profile Financial Highlights Relative Stock Price Performance (IPO to 19-Jun-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. JUNE 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. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 4
    Financial Highlights
  5. JUNE 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. JUNE 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. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 7
    Recent Trends in Relative Operating Margins Q4 2014 Operating Margin Q1 2015 Operating Margin 30.0% 30.0% 25% 25.0% 25.0% 23% 20.0% 18% 20.0% 8% 15.0% 13% 13% 15.0% 24% Peer Avg 10.0% 10.0% 8% 5.0% 5.0% 0.0% 0.0% Peer Avg -1%…
  8. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 8
    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…
  9. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 9
    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…
  10. JUNE 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. JUNE 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. JUNE 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. JUNE 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. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 14
    No Maturities of Any Debt until 2019, 2020 and 2021 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%…
  15. JUNE 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. JUNE 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. JUNE 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. JUNE 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 = 5.1% OSV Peer Mean = 2.2% TDW CKH GLF HOS L3M Share Volume 1,456,200 153,805 591,675…
  19. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 19
    Company Overview 20
  20. JUNE 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. JUNE 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. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 22
    Aggressive New Gen OSV Stacking Strategy HOS currently has 18 new generation OSVs stacked (seven 200 class and eleven 240 class OSVs) 23
  23. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 23
    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…
  24. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 24
    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…
  25. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 25
    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%…
  26. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 26
    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…
  27. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 27
    Top 2 Operator of Ultra Hi-Spec OSVs WW 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…
  28. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 28
    Top Operator of MPSVs Serving the Jones Act GoM Foreign-Flagged MPSVs U.S. Flagged MPSVs All MPSVs (Pro Forma1 by Vessel Count) (Pro Forma1 by Vessel Count) (Pro Forma1 by Vessel Count) Edison REM Siem Solstad Topaz Boa DOF…
  29. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 29
    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.…
  30. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 30
    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…
  31. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 31
    Upstream Macro Overview
  32. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 32
    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,…
  33. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 33
    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…
  34. JUNE 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. JUNE 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. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 36
    Deepwater E&P Demand Drivers Deepwater and ultra-deepwater exploration and production infrastructure Courtesy of: Clarkson Research Services Limited UK (www.crsl.com). 37
  37. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 37
    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:…
  38. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 38
    Hi-Spec Floating Rigs are Predominant in Our Core Markets Pro Forma Hi-Spec Fleet Hi-Spec Fleet Growth (with or without dual BOP) (by BOP Status) SE Asia 49% of pro forma hi-spec S America 3% 80 floating rig fleet with dual 10%…
  39. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 39
    Project Spartan OSV Newbuild Program 5
  40. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 40
    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%…
  41. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 41
    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…
  42. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 42
    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…
  43. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 43
    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…
  44. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 44
    HOSMAX 310 Class MPSV 45
  45. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 45
    Our Ultra Hi-Spec Fleet Will Drive Earnings Power 46
  46. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 46
    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…
  47. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 47
    Todd M. Hornbeck Chairman, President & CEO Investor Presentation James O. Harp, Jr. June 2015 Executive VP & CFO
  48. JUNE 2015 INVESTOR PRESENTATION – Hornbeck Offshore – slide 48
    Appendix

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