EURASIA DRILLING COMPANY LTD Goldman Sachs European Oil Services Symposium 2013 London 24 May, 2013 1
Agenda 1. EDC at a glance 2. 2013 Outlook 3. Market 4. Operations 5. Financial performance 3
EDC at a glance The largest drilling company in Russia and the CIS Market leadership: 1 onshore drilling company Corporate credit ratings in Russia with 29% market share by meters drilled S&P BB+ Stable in 2012(1) Fitch BB Stable…
History constant steady growth Schlumberger (SLB) asset transaction Ordered MERCURY Meters drilled, thsd m and strategic alliance in Russia and CIS jack-up from Lamprell 20% CAGR (19 drilling, 23 sidetrack & 34 W/O rigs) (Q4 2014…
Geographic presence Head Office Regional/Branch Office Support Base Operational Areas TIMAN-PECHORA EASTERN Usinsk SIBERIA Kogalym WESTERN Moscow Russia SIBERIA Tyumen VOLGA-URALS Kaliningrad Tomsk Zhirnovsk Kazakhstan…
Agenda 1. EDC at a glance 2. 2013 Outlook 3. Market 4. Operations 5. Financial performance 7
2013 Outlook Summary 2013 financial guidance Total revenues for 2013 are expected to be in excess of US 3.6 billion. EBITDA margin should be approximately 25.1% for the full year of 2013. Onshore Drilling and Workover Services Onshore…
2013 Outlook continued Offshore Drilling The SATURN j/u continues drilling for Petronas under a new 3-year contract effective January 9, 2013 in Turkmen waters of the Caspian Sea. The ASTRA j/u is committed to a full 12 month…
1Q 2013 Results Update Financial update Operations update Top line revenue up 6% to US 789 million (1Q 2012: Total drilling output during 1Q 2013 was up 6% and US 746 million); amounted to 1,366 thousand meters, while horizontal…
Agenda 1. EDC at a glance 2. 2013 Outlook 3. Market 4. Operations 5. Financial performance 11
Russias oil industry Russian oil production Russian oil production by region(1) 26 Oil prices backdrop has 24 4% 5% 21 23 5% 5% 5% 5% 6% 6% 4% 5% 5% 5% been supportive for 19 5% 7% 15 15 17 21% 8% drilling activity…
Drilling market dynamics Onshore well construction & servicing market, bn Drilling volumes in Russia, mn m 26.5 CAGR +10% Russian drilling industry 22.1 24.4 has demonstrated 27.2 19.6 25.5 increased drilling 24.4 21.1 15.7…
Market structure Russias onshore drilling by footage, 2012 EDC market share dynamics EDC 29% 29% SSK 7% 25% RU-Energy 7% 22% Independent: WFT 4% 17% 60% Eriell 2% Other major independent 3% Smaller independent 8% Surgut NG…
Agenda 1. EDC at a glance 2. 2013 Outlook 3. Market 4. Operations 5. Financial performance 15
Operating performance Drilling volumes have shown strong growth over the past years due to winning new customers and increased existing customer activity, as well as a series of successful acquisitions EDC drilling volume…
Customer portfolio Well balanced customer mix dominated by oil majors/long-term contracts 2007 EDC customers 2012 EDC customers Capex of Russian oil majors, bn Brent consensus 110 110 Rosneft Others forecast, /bbl 8% 1% TNK-BP…
Rig fleet EDC is to maintain a competitive drilling fleet EDC drilling rig fleet EDC rig fleet by age 59% EDC fleet is younger than Russias average 34% 33% 24% 15% 10% 12% 6% 4%…
Operational efficiency Ongoing focus on driving operational efficiencies EDC drilling rig fleet utilization EDC meters drilled per crew per day 258 257 +8% +5% 110 195 CAGR 102 180 +11% 85% CAGR 85 78% 77% 69 56% 2005…
Offshore assets Quality assets in a tight market Caspian Sea jack-up market EDC assets Approx. 3% of world oil reserves ASTRA 3 jack-up rigs currently in operation BMC-150-H jack-up rig Barriers to entry: time and costs to deliver…
Capital expenditures Capex program focused on evolving fleet to meet the most demanding and complex customer needs apex, mn EDCs fleet modernisation programme: 1. Refurbishment of Medium Pad/Cluster rigs 620 Workhorses of West…
Agenda 1. EDC at a glance 2. 2013 Outlook 3. Market 4. Operations 5. Financial performance 22
Debt profile EDC retains conservative debt profile Leverage dynamics Debt repayments as of 31.12.2012, mn 0.5x 227 0.4x 305 258 149 165 404 753 244 700 395 95 34 (226) Liquidity 2013 2014 2015 2016 2017 2018 and headroom…
Key strategic focus Maintain leadership position as the largest provider of onshore drilling services Organic growth and in Russia and operator of the largest jack-up fleet in key sectors of the Caspian Sea selective acquisitions Invest…
Appendix 26
Balance sheet thsd 2010 Audited 2011 Audited 2012 Audited Assets Current assets Cash and cash equivalents 629,466 509,781 305,333 Accounts receivable, net 252,749 378,523 528,813 Inventories 127,918 190,727 213,058 Other current…
Income statement and cash flow statement Income statement Cash flow statement thsd 2010 Audited 2011 Audited 2012 Audited thsd 2010 Audited 2011 Audited 2012 Audited Drilling and related services 1,808,905 2,734,444 3,222,830 Net income…
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