Pareto Securities Annual Oil & Offshore Conference McDermott International, Inc. (MDR) David Dickson, Chief Executive Officer
McDermott Today A leading provider of vertically integrated offshore and subsea engineering, procurement, construction and installation services Strategically located, in- market fabrication yards and a dynamic marine fleet of…
Agenda Capturing Value Market Through Integrated Strategic Themes Driving Financial Perspective Perspective Capabilities in Action Performance on the Future Financial Engineering QHSES Highlights 2016 Outlook Procurement…
Market Perspective
Industry Projections; E&P Capex Global E&P Capex Onshore is the main contributor to global capex growth 800 719 700 CAGR: 11% 600 588 By 2020, offshore capex will have recovered to 500 2016 levels Billion 385 400 300…
Capturing Value Through Integrated Capabilities
Engineering: Transforming our value Engineering as a Differentiator and an Enabler Positioned to Focus on Life of Field Services: Pre-FEED and FEED Services with oil and gas Post project completion services Expertise and…
Procurement: Cost Advantage Transformation Comprehensive plan established to achieve market cost advantage Supplier Partnerships: Develop joint market models with key suppliers to achieve global cost & Best in Class performance…
Construction: Driving to a global standard of efficiency Altamira Jebel Ali / Dammam Batam Global, in-market fabrication facilities with in-house full control of cost, quality and schedule Instituted fabrication council to drive…
Installation: Shallow to deep throughout the lifecycle Full solution of shallow water fleet capabilities and versatile subsea fleet, supported by in-market teams Expertise in complex brownfield installation, hook-up and…
Strategic Themes in Action
QHSES: A Core Value with Industry Leading Performance for 6 Years Total Recordable Incident Rate (TRIR) Over a Decade 1.20 1.00 0.80 Incident Rate IMCA 0.60 0.40 IOGP 0.20 0.00 2005 2006 2007 2008 2009 2010…
Our Strategic Themes in Action Customer Alignment: ONGC Vashishta Alliance & Consortium with Larsen & Toubro provides best in-market solution and utilizes shallow and subsea assets Scope of work includes: 30 miles of umbilicals 64…
Maintaining the lead in Middle East Experience: Offshore Structures and Pipelines Installed Since 1980 130 23 451 mi The Focus Kuwait & 112 mi Qatar Neutral Zone Key Clients Deepen customer alignment and relationships Key Client…
Driving Financial Performance
Q2 2016 Financial Highlights in millions except for per share data Year- Q2 2016 Order Intake resulting Sequential over-Year from Pemex Abkatun-A2, three Q216 Q116 Delta Q215 Delta large awards with Saudi Aramco Orders 1,235 339…
Q2 2016 Backlog and Roll-off in billions Details of 4.4BN Backlog as of June 30, 2016 Backlog by Business Line Backlog by Segment Backlog Roll-Off by Year 2.4 ASA Subsea 0.9 AEA 0.9 20% 0.6 20% 14% 1.1 Offshore 0.9 3.5…
2016 Outlook in millions, except per share amounts, or as indicated Q216 Guidance Revenues 2.7B Operating Income 126 Net Loss (8) Diluted Loss Per Share (0.03) Net Interest Expense1 60 Income Tax Expense 60 Adjusted Operating…
2016 Focus Areas Maintain Middle East market leader position Focus on NOCs and markets where capital is being invested Grow customer alignment and strength of relationships Drive further integration of process and…
Q&A
Appendix
Bids Outstanding and Target Projects1 in billions 16.7 billion as of Q2 2016 compared to 18.4 billion in Q1 2016 Business Line Oil/Gas Greenfield/Brownfield 13.4 10.8 11.4 9.6 8.9 8.8 8.4 8.3 7.6 7.8 5.0 5.3 Offshore…
Q2 2016 Revenue Pipeline by Project Size Estimated Total Contract Values As of June 30, 2016, contract values in millions Q216 Pipeline Q116 Pipeline Delta from Sequential Quarter Bids Target Bids Target Bids Target Backlog…
Key Project Awards YTD AEA MEA ASA Timeline - Award Date to Expected Completion Work Contract Project 2016 2017 2018 Client Field or Project Type scope Size 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Woodside Greater Western Flank Phase 2…
Projects 50M percent of completion (POC)1 12 Jackets North Field Alpha Karan 45 INPEX Ichthys MEA Pipeline EPCI Yamal Pemex Ayatsil-C Marjan GOSP KJO Hout AEA RasGas North Field Aramco Lump Sum MEA ONGC Vashishta ASA QGEP…
Asset Utilization Summary Q216 Q116 Increased marine activity in MEA drives Fabrication (Mhrs 000s) full utilization of offshore vessels Actual 2,188 2,475 Standard 4,438 4,438 Fabrication utilization reflects decreased % of…
Capital Structure Capitalization Debt Maturity Profile 6/30/16 in millions 6/30/16 3/31/16 500 Cash and Restricted Cash 583 798 (MM) Tangible Equity Units - Notes 17 21 North Ocean 105 Loan 37 41 Term Loan B 219 295 Senior…
Additional Disclosures1 Reconciliation of US GAAP to Non-GAAP Financial Measures Three Months Ended June 30, 2016 March 31, 2016 June 30, 2015 (In thousands, except share and per share amounts) GAAP Net Income (Loss) Attributable…
Additional Disclosures1 Reconciliation of US GAAP to Non-GAAP Financial Measures Three Months Ended Six Months Ended June 30, 2016 March 31, 2016 June 30, 2015 June 30, 2016 June 30, 2 (In thousands) Net i ncome (l os s ) a ttri…
Additional Disclosures1 Reconciliation of US GAAP to Non-GAAP Financial Measures In thousands Three Months Ended June 30, 2016 Three Months Ended March 31, 2016 AEA MEA ASA AEA MEA ASA Revenues 86,810 317,834 301,983 62,625…
Additional Disclosures1 Reconciliation of Forecast US GAAP to Non-GAAP Financial Measures Q2' 16 Guidance (In thousands, except per share amounts) GAAP Net Loss Attributable to MDR (8,300) Less: Adjustments Res tructuri ng cha…
Katherine Murray INVESTOR Vice President, Treasurer and Investor Relations CONTACT 281.870.5147 KAMurraymcdermott.com The information contained herein is provided for general information purposes only and is not intended or to be…
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