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HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International

Oceaneering International · Mar 29, 2011 · 52 slides

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Slides

  1. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 1
    WHY OII Leveraged to Deepwater Secular Growth Positioned to Rebound Leading Market Positions ROVs and Specialty Subsea Products Strong St Earnings, E i Balance B l Sh Sheett & Cash C h Fl Flow
  2. HOWARD WEIL 39TH ANNUAL ENERGY 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. HOWARD WEIL 39TH ANNUAL ENERGY 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. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 4
    Near-Term Deepwater Outlook DOI Regulations Lower Activity in the U.S. Gulf of Mexico Largest Market for ROV Services ROV Tooling & IWOCS Sole Market for Subsea Projects Operations Additional Subsea Product Opportunities pp ROV…
  5. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 5
    Earnings Per Share Guidance 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 0.00 2007 2008 2009 2010 2011E OII 2011…
  6. HOWARD WEIL 39TH ANNUAL ENERGY 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 2010 2011E 2011E Based on First Call Mean Estimates as of February 28, 2011.
  7. HOWARD WEIL 39TH ANNUAL ENERGY 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 2010 2011E 2011E Based on First Call Actuals and Mean Estimates as of February 28, 2011.
  8. HOWARD WEIL 39TH ANNUAL ENERGY 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. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 9
    Strong Balance Sheet & Cash Flow December 31, 2010 245 MM in Cash No Debt 300 MM Revolving Credit Available Strong Cash Flow Over 435 MM of EBITDA Expected in 2011 Ample Resources to Invest in Growth EBITDA Reconciliation to…
  10. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 10
    Plans For Cash Organic Growth 2011 Capex 150 MM / 175 MM Acquisitions Share Repurchases
  11. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 11
    Acquisition Targets Within our Market Niches Expand E dSSubsea b P Products d t International Focus Reasonably Priced Accretive to Earnings
  12. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 12
    Norse Cutting & Abandonment Acquisition Expected to Close by March 31, 2011 60 MM P Purchase h P Price i Subsea Products Expansion Increase Tooling Product Line Enhance E h Abilit Ability tto P Participate ti i t in P&A…
  13. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 13
    Worldwide Deepwater Discoveries Almost Two-Thirds Two Thirds to be Developed 600 515 500 400 Evaluation 300 377 Development Production 200 100 235 138 0 Production Eval. / Dev. Source: ODS-Petrodata December 2010…
  14. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 14
    Floating Rig Supply and Demand Floater Demand Floating Rigs Available 300 251 verage of Rigs 250 220 200 Quarterly Av 150 At Dec 31 Supply 255 Q Demand 220 100 2000 2001 2002 2003 2004 2005 2006 2007 2008…
  15. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 15
    Floating Rig Fleet Expansion: 2011 - 2014 60 Rigs On Order at December 31, 2010 35 Contracted Average length 7.5 years 24 Expected to be Placed In Service in 2011 Source: OII Estimates Based On ODS-Petrodata Data: December…
  16. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 16
    Remotely Operated Vehicles 35% Revenue by Business Segment December 2010
  17. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 17
    OII ROV Fleet Size 300 260 eriod End 250 200 Vehicle Count Pe 150 100 125 50 0 December 2010
  18. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 18
    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
  19. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 19
    2011 ROV Overview Increase in Days On Hire Added 22 New Systems in 2010 Expect to Add 15 to 20 New Systems in 2011
  20. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 20
    Operating Income ROV 2011Estimate 2010 Actual Estimate (in millions) 250 200 150 100 50 0 2007 2008 2009 2010 2011E OII 2011 Guidance Range as of February 16, 2011.
  21. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 21
    Worldwide Subsea Completions This Decade Expected to Grow 45% 45% Completed Estimated 5 000 5,000 4513 mpletions 4,000 Subsea Com 3071 3,000 Number of S 2,000 1111 1,000 , N 0 90s 00s 10s Source:…
  22. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 22
    Subsea Tree Orders Forecasted at Historically High Levels 1000 40% Growth* 800 Tree Orrders 600 400 200 0 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11F '12F '13F '14F * 2011-2014 vs 2007-2010 Source: Quest…
  23. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 23
    29% Subsea Products Revenue by Business Segment ROV Tooling & Work Packages Umbilicals Field e d Development e e op e t Hardware December 2010
  24. HOWARD WEIL 39TH ANNUAL ENERGY 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 Highly Engineered Worldwide Coverage
  25. HOWARD WEIL 39TH ANNUAL ENERGY 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 Skid ROV Accumulator Reservoir Skids Backup Accumulator…
  26. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 26
    Subsea Products Backlog At Period End 400 384 300 Millions 200 100 0 2006 2007 2008 2009 2010
  27. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 27
    Operating Income Subsea Products 2011 Estimate 2010 Actual Estimate ((in millions)) 120 100 80 60 40 20 0 2007 2008 2009 2010 2011E OII 2011 Guidance Range as of February 16, 2011.
  28. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 28
    Subsea Completions Gulf of Mexico Historical and Projected Completed Estimated 1000 pletions 251 800 ubsea Comp 600 umulative Su 400 725 200 426 210 Cu 0 1999 2004 2009 2014P Source: Quest Offshore…
  29. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 29
    13% Subsea Projects Revenue by Business Segment Diving Deepwater December 2010
  30. HOWARD WEIL 39TH ANNUAL ENERGY 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 Built-in in Below Deck Equipment Available March 2011
  31. HOWARD WEIL 39TH ANNUAL ENERGY 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 Q2 2011
  32. HOWARD WEIL 39TH ANNUAL ENERGY 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. HOWARD WEIL 39TH ANNUAL ENERGY 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 Intervention IV
  34. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 34
    Operating Income Subsea Projects 2011 Estimate < 2010 Actual Estimate ((in millions)) 120 100 80 60 40 20 0 2007 2008 2009 2010 2011E OII 2011 Guidance Range as February 16, 2011.
  35. HOWARD WEIL 39TH ANNUAL ENERGY 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. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 36
  37. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 37
    Supplemental Financial Information
  38. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 38
    EBITDA Actual Low Estimate High Estimate 500 400 s) ( millions 300 200 100 0 2007 2008 2009 2010 2011* *2011 - 435MM-465MM, Based on OII EPS Guidance Range February 16, 2011. See Next Slide For Non-GAAP…
  39. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 39
    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…
  40. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 40
    OII Balance Sheet ((in millions)) Dec 31 D 31, Dec 31 D 31, Dec 31 D 31, Dec 31 D 31, Dec 31 D 31, 2006 2007 2008 2009 2010 E it Equity 697 915 968 1 224 1,224 1 390 1,390 Debt 194 200 229 120 0 Cash 26 27 11 162 245…
  41. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 41
    Capital Expenditures: 2010 90% on ROVs, Subsea Products, and Subsea Projects j ROV Subsea Products Subsea Projects Other 6% 21% 53% 20%
  42. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 42
    Business Segment Revenue % of Oilfield 88% ROV - 39% Products - 33% 85% Projects - 15% Inspection - 13% Oilfield Non Oilfield December 2010
  43. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 43
    Business Segment Operating Income % of Oilfield 96% ROV - 54% Products - 28% 90% Projects - 12% Inspection - 6% Oilfield Non Oilfield December 2010
  44. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 44
    Supplemental Market Information
  45. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 45
    Oilfield ROV Fleet Ownership p Profile - December 2010 35% OII OII Subsea 7 260 Sonsub Fugro Canyon Other 747 Vehicles Source: OII Estimates, December 2010
  46. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 46
    OII ROV Fleet Geographic g p Profile December 2010 9 66 GOM 29 15 Africa Norway 34 Brazil 56 UK U.K. 51 Asia/Pac Other NA 260 Vehicles December 2010
  47. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 47
    Oilfield ROV Drill Support Market December 2010 OII Subsea 7 60% Fugro Sonsub Other 172 Floating Rigs In Service Source: ODS-Petrodata and OII Estimates .
  48. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 48
    OII ROV Fleet Construction/Field Maintenance Locations 4 GOM Africa 18 Norway 13 Other 14 49 Vehicles December 2010
  49. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 49
    OII ROV Fleet Construction/Field Maintenance Customers Operators 24 25 Contractors 49 Vehicles December 2010
  50. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 50
    Worldwide Umbilical Market Overview Forecasted at Historicallyy High g Levels Umbilicals Tree Orders 40% Growth* - Trees 70% Growth* - Umbilicals 750 3,000 Umbilical Ordeers - KM Tree Ordeers 500 2,000 250 1,000…
  51. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 51
    Umbilical Products Thermoplastic Hose Umbilicals Steel Tube Umbilicals
  52. HOWARD WEIL 39TH ANNUAL ENERGY CONFERENCE – Oceaneering International – slide 52
    OIE Products Production Control Valves ROV Tooling g & Work Packages Installation Workover & Control Systems Connectors & Repair Systems Field Development Hardware

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