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SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International

Oceaneering International · Jan 5, 2011 · 59 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. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 1
    WHY OII Leveraged to Deepwater Secular Growth Positioned to Rebound Leading Market Positions ROVs and Specialty Subsea Products Strong Earnings, Balance Sheet & Cash Flow
  2. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 2
    Leveraged to Deepwater Projects Take Years to Develop Largely Oil Reservoirs With High Production Flow Rates Well Capitalized Customer Base Investment Based on Long-Term Commodity Price
  3. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 3
    Long-Term Deepwater Outlook Invest Where the Oil Is Western IOCs Have Little Choice Restricted Access to World Class Onshore Reserves Exploration Success Bodes Well for the Future Drilling Intensity is Rising Source: Wood…
  4. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 4
    Near-Term Deepwater Outlook Pending DOI Regulations Lower Activity in the U.S. Gulf of Mexico Largest L tMMarket k t for f ROV Services ROV Tooling & IWOCS Sole Market for Subsea Projects Operations Additional Subsea Product…
  5. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 5
    Earnings Per Share Guidance 2010 Estimate 3 3.57 57 - 3.62; 3 62; 2011 Estimate 3 3.45 45 - 3.75 3 75 Actual Low Estimate High Estimate 4.00 3.50 hare 3 00 3.00 Earnings Per Sh 2.50 2.00 1.50 1.00 0 50 0.50…
  6. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 6
    Combined EPS OSX Companies Excluding OII Actual Consensus Estimate 75 hare 60 Earnings Per Sh 45 30 15 0 2007 2008 2009 2010E 2011E 2010E & 2011E Based on First Call Mean Estimates as of October 29, 2010
  7. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 7
    Relative EPS Performance To Recent 2008 Peak OII OSX w/o OII 10% 0% -10% -20% -30% -40% -50% 2008 2009 2010E 2011E Based on First Call Historical Numbers and Consensus 2010 & 2011 Estimates October 29, 2010
  8. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 8
    2011 EPS Guidance The Big Picture SEGMENT OPERATING INCOME ROV 2010 Subsea Products 2010 Subsea Projects < 2010 I Inspection ti 2010 Advanced Tech 2010
  9. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 9
    Strong Balance Sheet & Cash Flow September 30, 2010 148 MM in Cash No Debt 300 MM Revolving Credit Available Strong Cash Flow Over 325 MM Expected in 2011 Ample Resources to Invest in Growth Cash Flow is defined as Net Income +…
  10. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 10
    Plans For Cash Organic Growth Q4 2010 Capex 35 MM 2010 Total 200 MM 2011 Capex C 1 0 MM / 1 150 175 MM Acquisitions Share Repurchases
  11. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 11
    Acquisition Targets Within our Market Niches Expand Subsea Products International Focus Reasonably Priced Accretive to Earnings
  12. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 12
    Worldwide Deepwater Discoveries Over Two-Thirds Two Thirds to be Developed Production Development Evaluation 600 502 500 elds umber of Fie 400 352 300 Nu 200 100 230 150 0 Production Eval. / Dev. Source:…
  13. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 13
    Floating Rig Supply and Demand Floater Demand Floating Rigs Available 300 Rigs 245 250 erage of R 221 200 uarterly Ave At Sept 30 150 Supply 247 Demand 222 Qu 100 Source: ODS-Petrodata
  14. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 14
    Floating Rig Fleet Expansion: 2010 - 2014 64 Rigs On Order at September 30, 2010 41 Contracted Average length 7 years Expected to be Placed In Service 30 in 2010 30 in 2011 Source: OII Estimates Based On ODS-Petrodata Data,…
  15. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 15
    35% Remotely Operated Vehicles Revenue by Business Segment September YTD 2010
  16. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 16
    OII ROV Fleet Size 300 260 E 250 d End unt Period 200 150 Vehicle Cou 100 125 50 0 December 2010
  17. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 17
    ROV Operating Leverage Revenue / Day on Hire Fleet Utilization 11,000 100% 9,000 80% 7,000 60% 5,000 40% 3,000 20% 1,000 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010* * September YTD
  18. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 18
    2010 & 2011 ROV Overview Increase in Days On Hire Added 21 New Systems in 2010 Add 15 New Systems in 2011
  19. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 19
    ROV Expansion Opportunities Both Drill Support and Construction & Field Maintenance Service Rigs on Order without ROV Contracts 37 as of September 2010 Subsea Service Vessels Under Construction
  20. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 20
    Operating Income ROV 2010 Estimate 2009; 2011Estimate 2010 Actual Estimate (in millions) 250 200 150 100 50 0 2007 2008 2009 2010E 2011E OII 2010 and 2011 Guidance Range as of October 26, 2010.
  21. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 21
    Worldwide Subsea Completions This Decade Expected to Grow 45% Completed Estimated 5,000 4442 mpletions 4,000 Subsea Com 3071 3,000 Number of S 2,000 1111 1,000 N 0 90s 00s 10s Source: Quest Offshore…
  22. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 22
    Subsea Tree Orders Forecasted at Historically High Levels 1000 20% Growth 800 Tree Orderrs 600 400 200 0 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10F '11F '12F '13F '14F Source: Quest Offshore Resources Mean Case…
  23. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 23
    Subsea Products Revenue by Business Segment ROV Tooling & Work Packages Umbilicals Field e d Development e e op e t Hardware September YTD 2010
  24. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 24
    Subsea Products Required for Every Subsea Completion Subsea Hardware Umbilicals ROV Tooling Field Development IWOCS Connectors & Valves BOP Control Systems y Highly Engineered Worldwide W ld id C Coverage
  25. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 25
    Additional Subsea Product Opportunities Macondo Incident Safety Concerns ROV Tooling Hot Stabs with Higher Flow Rates Hot Stab Receptacles & Valves ROV Accumulator Reservoir Skids Backup Accumulator Bottle Skids BOP Control…
  26. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 26
    Subsea Products Backlog At Period End 400 308 300 Millions s 200 100 0 2006 2007 2008 2009 2010* *September 2010
  27. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 27
    Operating Income Subsea Products 2010 Estimate 2009; 2011 Estimate 2010 Actual Estimate ((in millions)) 100 75 50 25 0 2007 2008 2009 2010E 2011E OII 2010 and 2011 Guidance Range as of October 26, 2010.
  28. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 28
    Subsea Completions Gulf of Mexico Historical and Projected Completed Estimated 1000 pletions 800 227 ubsea Comp 600 umulative Su 400 725 200 426 210 Cu 0 1999 2004 2009 2014P Source: Quest Offshore…
  29. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 29
    13% Subsea Projects Revenue by Business Segment Page 16 Diving Deepwater September YTD 2010
  30. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 30
    Subsea Projects Ocean Project Replacement Vessel U.S. Flagged 200 x 46 DSV 3000 sq ft Deck Space 4-Point Mooring System Built-in Built in Below Deck Equipment Available Q1 2011
  31. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 31
    Subsea Projects Ocean Patriot DMT Sapphire Acquisition Acquired for 16.5 MM in June 2010 Renamed Ocean Patriot Will Be Outfitted with a new SAT System [Neptune] Available Q1 2011
  32. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 32
    2011 Subsea Projects Overview GOM Shallow Water Installation & IRM OII Vessels Available for this Market Ocean Quest Ocean Inspector Ocean Project Ocean Patriot Saturation Diving Systems Nemo Nautilus Neptune
  33. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 33
    2011 Subsea Projects Overview GOM Deepwater Installation & IRM OII Vessels Available for this Market Ocean Intervention Ocean Intervention II Ocean Intervention III Olympic Ol mpic Inter Intervention ention IV
  34. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 34
    Operating Income Subsea Projects 2010 Estimate < 2009; 2011 Estimate < 2010 Actual Estimate ((in millions)) 120 100 80 60 40 20 0 2007 2008 2009 2010E 2011E OII 2010 Guidance Range as of October 26, 2010.
  35. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 35
    OII Summary Diversified OFS Company Leveraged Le eraged to Deep Deepwater ater Leading Market Positions in Technical Niches Strong Earnings, Balance Sheet & Cash Flow
  36. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 36
  37. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 37
    Supplemental Financial Information
  38. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 38
    Net Income + Depreciation & Amortization Actual Low Estimate High Estimate 400 300 s) ( millions 200 100 0 2007 2008 2009 2010* 2011* *2010 - 345MM-350MM, *2011 - 325MM-350MM - Based on OII EPS Guidance Range…
  39. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 39
    EBITDA Actual Low Estimate High Estimate 500 400 s) ( millions 300 200 100 0 2007 2008 2009 2010* 2011* * 2010 - 455MM-460MM, *2011 - 425MM-460MM, Based on OII EPS Guidance Range October 26, 2010. See Next Slide…
  40. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 40
    EBITDA Reconciliation to Net Income Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measurement. Oceaneerings management uses EBITDA because we believe that this measurement is a widely…
  41. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 41
    OII Balance Sheet ((in millions)) Dec 31 D 31, Dec 31 D 31, Dec 31 D 31, Dec 31 D 31, Septt 30, S 30 2006 2007 2008 2009 2010 E it Equity 697 915 968 1 224 1,224 1 338 1,338 Debt 194 200 229 120 0 Cash 26 27 11 162 148…
  42. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 42
    Capital Investments by Type: 2005 - 2009 Organic Growth Acquisitions 12% 88%
  43. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 43
    Oilfield Capital Investments*: 2005 - 2009 85% on ROVs and Subsea Products ROV Subsea Products All Other Oilfield Segments 27% 60% * Capital Expenditures
  44. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 44
    Capital Investments*: 2009 90% on ROVs and Subsea Products * Capital Expenditures - December 2009
  45. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 45
    Capital Investments*: 2010 75% on ROVs and Subsea Products ROV Subsea Products Subsea Projects Other 4% 19% 57% 21% * Capital Expenditures September YTD 2010
  46. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 46
    Business Segment Revenue % of Oilfield ROV - 40% Products - 32% 85% Projects - 15% 87% Inspection - 13% Oilfield Non Oilfield September 2010
  47. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 47
    Business Segment Operating Income % of Oilfield ROV - 55% Products - 26% 90% Projects - 12% 95% Inspection - 7% Oilfield Non Oilfield September 2010
  48. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 48
    Supplemental Market Information
  49. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 49
    Oilfield ROV Fleet Ownership p Profile December 2009 35% OII OII Subsea 7 248 Saipem Acergy ce gy Fugro Other 706 Vehicles Source: OII Estimates December 2009
  50. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 50
    OII ROV Fleet Geographic g p Profile September p 2010 27 9 68 GOM 18 Africa ca Norway 35 Brazil 51 U.K. 44 Asia/Pac Other NA 252 Vehicles September 2010
  51. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 51
    Oilfield ROV Drill Support Market September p 2010 OII Subsea 7 58% Fugro Sonsub Other 167 Floating Rigs In Service Source: ODS-Petrodata and OII Estimates
  52. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 52
    OII ROV Fleet Construction/Field Maintenance Locations 7 GOM Af i Africa 24 Norway 10 Oth Other 15 56 Vehicles September 2010
  53. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 53
    OII ROV Fleet Construction/Field Maintenance Customers O Operators 23 33 Contractors 56 Vehicles September 2010
  54. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 54
    Global Subsea Production Umbilicals Market Share Byy Length g Awarded 2009 Source: Quest Offshore Resources February 2010
  55. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 55
    Worldwide Umbilical Market Overview Forecasted at Historicallyy High g Levels Umbilicals Tree Orders 20% Growth - Trees 750 3,000 51% Growth - Umbilicals Umbilical Ordeers - KM Tree Ordeers 500 2,000 250 1,000…
  56. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 56
    Umbilical Products Thermoplastic Hose Umbilicals Steel Tube Umbilicals
  57. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 57
    OIE Products Production Control Valves ROV Tooling g & Work Packages Installation Workover & Control Systems Connectors & Repair Systems Field Development Hardware
  58. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 58
    Annual Price Performance OII vs. OSX [Oilfield Service Index] 2010 OII up 21% OSX up 15% 120 100 80 ange 60 ual % Cha 40 20 0 Annu -20 -40 -60 -80 OII OSX *Through November 9, 2010: Source NYSENet
  59. SAN FRANCISCO ENERGIZE CONFERENCE – Oceaneering International – slide 59
    Cumulative Price Performance OII vs. OSX [Oilfield Service Index] 2010 OII up 21% OSX up 15% 700 600 ange 500 ve % Cha 400 300 200 Cumulativ 100 0 C -100 OII OSX *Through November 9, 2010: Source…

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