Mission Statement Our mission is to be recognized as the energy industrys marine transportation and service company of choice for our customers, employees and investors through innovative, high quality, value-added business…
QHS&E Certifications ISM certification for all SOLAS class OSVs and AHTS vessels ISM Code certified on all vessels Only U.S. marine transportation and energy service company with SIP approval ISO 140001:2004 certified by ABS ABS…
Upstream Market Summary
Best in Class OSV Fleet HOS OSV fleet is 100% new generation HOS has one of the youngest technologically advanced vessels1 OSV fleets of all U.S. publicly traded peers Hornbeck 7 Peer Average Fleet Age = 10 years Gulfmark 9…
Brazil Pre-Salt Play 660 nm (Tampa Houston) Source: Petrobras; Company estimates. Source: The Economist; Petrobras; BP 10
Upstream Fleet Summary
Upstream Fleet: Historical Timeline Launched 4th OSV Acquired and integrated Sold two newbuild program the Sea Mar fleet of 10 conventional Sold two 220 consisting of nine Super 200 class new vessels class OSVs Launched 2nd OSV…
Multi-Class Fleet of New Generation OSVs 200 class HOS Crossfire, 220 class HOS Voyager, one of 240E class HOS Innovator surveying our first proprietary new generation OSV six OSVs acquired from Candy Fleet hurricane damage at BPs…
Three Distinct Classes of MPSVs Merwede T-22 class HOS 370 class HOS 310 class DP3 design DP2 design DP2 design HOS Iron Horse, our second of two 430-ft HOS Centerline, our first of two 370-ft TBD Newbuilds, our first of five…
430 class DP3 MPSVs 15
370 class DP2 MPSVs 16
310 class DP2 MPSVs 17
HOS Port Site Plan 18
Vast Majority of U.S. Offshore Energy Infrastructure is in Hurricane Alley Mobile Rig Locations (as of September 20, 2005) All Fixed Manned Platforms 19
Post Hurricane Repair Offshore Supply Vessels Multi-Purpose Support Vessels DP2 240E class OSV, HOS Innovator surveying DP3 T-22 class MPSV, HOS Achiever, damage at BPs Thunderhorse semi-submersible on her first shelf platfom…
Proprietary OSV Newbuild Designs Six Discrete Classes Proprietary Design Features HOS 200 OSV HOS 240/240E/240ED OSV HOS 250EDF OSV HOS 265 OSV Since 1998, HOS has built a multi-class fleet of in-house designed new…
DP1 System Classification Breakdown 24
DP2 System Classification Breakdown 25
DP3 System Classification Breakdown 26
MPSV Fleet Capabilities
Highlights of 370 Class MPSV-DP2 Vessel Specs Vessel Equivalents to 8,000 DWT Vessel Specs Proprietary HOS 370 class DP2 design 10.0 370-ft overall length 9.0 8k deadweight tons (dwt) 8.0 30k bbls of liquid mud capacity 7.0 Crane…
Highlights of T-22 Class MPSV-DP3 Vessel Specs Vessel Specs Proven Merwede T-22 class DP3 design 430-ft overall length 8k deadweight tons 15,000 bhp propulsion HOS Achiever Accommodations for 100 to 150 Delivered in 4Q2008 Moon…
Highlights of 310 Class MPSV-DP2 Vessel Specs IMO Special Purpose Ship Class Notation 300-ft overall length 150-250 ton heave-compensated knuckle-boom cranes Accommodations for 73 persons Moon pool / heli-deck Suitable for…
Comparison of HOS Vessel Capabilities USCG Typical Features 370 MPSV- HOS 265 MPSV-DP3 Notation and Services DP2 Platform Supply Subchapter L: ROV Support Saturation Dive Support Subsea Construction / IRM Decommissioning Deep…
HOS Strongline Before and After 32
HOS Strongline Before and After 33
Record-Setting Riserless Well Intervention The HOS Iron Horse performing subsea support Deploying Blue Ocean Technologies subsea well intervention equipment from the HOS Iron Horse HOS Iron Horse used as the work platform for…
Shell Perdido Spar Flotel The HOS Achiever under normal The HOS Achiever mobilized for flotel operation subsea support configuration to support Shells Perdido SPAR Six-week mobilization to add additional berthing to accommodate…
Shell Perdido Spar Flotel Transferring personnel between the HOS Achiever Discharging SPAR personnel on the helideck and the Perdido SPAR atop the HOS Achiever More than 47,300 incident-free personnel transfers between the HOS…
Shell Perdido Spar HOS Crew 37
Shell Perdido Spar Personnel Transfers 38
Shell Perdido Spar Accommodation Units 39
Shell Perdido Spar Safety Drills 40
Shell Perdido Spar Helideck Ops 41
BP Oil Spill Response
BP Oil Spill Response Spread BP p.l.c. BP p.l.c. BP p.l.c. BP p.l.c. 43
HOS Involved in Each Major Category of BP Spill Relief Mobilized and operated various types of oil containment boom and skimming equipment New Generation Applied biodegradable dispersants to help break down surface oil OSVs Supported…
BPs Operation Top Kill The HOS Centerline, the primary kill vessel The HOS Strongline acting as a standby supporting BPs Operation Top Kill vessel for BPs Operation Top Kill The HOS Centerline along side the Q4000 Pumping…
BPs Operation Top Kill Helix Energy Solutions Q4000, a DP-3 semi- The HOS Centerline along side the Q4000 Pumping hoses deployed overboard the HOS submersible multi-purpose vessel during Operation Top Kill Centerline to the…
BP Static Kill Operation BP p.l.c. 51
BP Oil Spill: Subsea Response 300-ton A&R winch Lowering of a deepwater work-class ROV on the HOS Achiever from a HOS DP-3 MPSV 100-ton knuckle-boom crane 120-ton knuckle-boom crane ROV deployed from the HOS Iron on the HOS…
BP Oil Spill: Surface Response The HOS Mystique outfitted with Koseq oil HOS Super H deployed as a sweeping system surface dispersant vessel The HOS North configured as an oil skimming The HOS North operating with a V.O.S.S.…
BP Oil Spill: Oil Recovery The Energy 13501 outfitted with oily water separators and skimming equipment The Energy 8001 outfitted with oily water separators in lightering and storage response role 54
Downstream Fleet History
Sale of Downstream Segment Ocean-going Tugs Tank Barges 9 Rebuilt Tugs 9 Double-Hulled Barges Closed the sale of substantially all of the Downstream segment to Genesis Marine in August 2013 The all-cash transaction generated…
Downstream Fleet: Historical Timeline Closed the August 2013 sale of Downstream Retired three SH tank Sold six SH tank segment to Sold one tug and two barges under OPA 90 barges and one Delivered two Genesis SH tank barges tug…
Diverse Fleet of Tugs and Tank Barges Energy 13501, our first proprietary HOS tugs docked at our Energy 13501 on its maiden voyage, double-hulled tank barge newbuild Brooklyn shore-based facility powered by the 6,140 hp Liberty…
Financial Highlights
Company Valuation and Credit Metrics 52-Week Range 24.93-57.01 2013A 2014E 3 2015E 3 Average Daily Trading Volume (L3M) 724k Results Stock Price 30-Oct-2014 1 30.66 EBITDA 314m 299m 362m Diluted Common Shares Outstanding 36.3 Diluted…
Worldwide Publicly Traded OSV Peer Group Equity Market Cap (USD) 2,500 (in millions) 2,000 1,500 1,000 500 - DESSC SIOFF EIOF TDW CKH GLF HOS SOFF DOF FAR HAVI GBB EZRA…
Upstream Contract Coverage with Blue-Chip Customers Contracted Days Contracted Revenue 100% 80% 38% 37% BBB A 10% Other 1 60% 73% 82% 22% 16% 40% AAA 62% 63% AA 21% 31% 20% 27% 18% 0% 4Q14 2015 4Q14 2015 Offshore Supply…
Young Fleet Requires Lower Maintenance Capex Maintenance Capex 2013A 2014E 2015E Deferred drydocking charges 36m 45m 24m Other vessel capital improvements 11m 21m 2m Other Capex 2013A 2014E 2015E 200 Class OSV retrofit…
Pro Forma DWT-Adjusted Historical Dayrates Historical Dayrates Indexed to Current Average Fleet Capacity New Generation OSV Fleet 35,000 30,000 25,000 Average Dayrate 20,000 15,000 10,000 5,000 - 1Q99 1Q00…
Pro Forma Operating Leverage of Upstream Fleet Dayrate Sensitivity for New Gen OSV Fleet Dayrate Sensitivity for MPSV Fleet Change in Change in Dayrate Change EBITDA Change in EPS Dayrate Change EBITDA Change in EPS 2,000 48.9m…
Track Record of Value Creation in Market Upcycles EVA = CWIP Adjusted ROIC1 WACC 20.0% 18.0% 2008 CWIP-Adj ROIC 16.0% 16.7% 14.0% EVA = 9.0% HOS Pre-Macondo Avg ROIC =12.8% 12.0% HOS 13-yr Avg CWIP-Adjusted ROIC = 10.8%…
2013 Return on Invested Capital (ROIC1) Average Invested Capital ( in millions) BoY EoY Avg Book Equity 1,165.8m 1,295.4m 1,230.6m Plus Debt 1,089.4 1,064.1 1,076.8m Less Cash 576.7 439.3 508.0m Invested Capital 1,678.5 1,920.2…
Capital Structure
Current Weighted-Average Cost of Capital (Calculated as of 7-Feb-2014) BOY Capital Structure 1 Book Equity 1,235m 52.3% Debt 1,125m 47.7% Total Capital 2,360m Cost of Equity = Rf + (Rm - Rf) Risk-free Rate (Rf) 2.85% Industry Beta2…
Start-Up Phase Capital Structure 300 250 2001 Cap Ratio: 200 150 75% Debt 100 50 25% Equity - 1997 1998 1999 2000 2001 Senior Secured Term Facility A Senior Secured Term Facility B Senior Secured Term Facility C…
Pre-IPO Phase Capital Structure 600 500 2004 Cap Ratio: 400 300 57% Debt 200 100 43% Equity - 2001 2002 2003 2004 10.625% Senior Notes due 2011 6.125% Senior Notes due 2014 Drawn Revolving Credit Facility…
Post-IPO Phase Capital Structure 1,600 1,400 2008 Cap Ratio: 1,200 1,000 46% Debt 800 600 400 54% Equity 200 - 2004 2005 2006 2007 2008 10.625% Senior Notes due 2011 6.125% Senior Notes due 2014 1.625% Convertible…
Strong Balance Sheet and Ample Liquidity 31-Dec-2011 31-Dec-2012 31-Dec-2013 30-Sep-2014 ( in millions) Actual Actual Actual Actual Cash and Equivalents 357 577 439 244 Revolving Credit Facility 0 0 0 0 6.125% Senior Notes due 2014 300…
Strong Asset Coverage 3,500 3.9x 3,258 3,000 3.5x 2,874 2,500 2.9x 2,398 2,000 1,500 1,000 827 Net Debt 4 500 0 Replacement Cost 1 Fair Market Value 2 Net Book Value 3 1 Represents current internal estimates of the…
Summary of 2001 and 2004 Bond Offerings HOS Notes due 2008 1100 11.000% yield + 600 bp spread 900 700 500 300 HOS 10.625% HOS 6.125% Senior Notes Senior Notes 100 Jan-01 Sep-01 Jun-02 Mar-03 Nov-03 Aug-04 May-05…
Summary of 2005 Follow-on Equity Offering I Survived Hurricane HOS... HOS OSX September 2005 250% Sep 29 - HOS prices upsized Follow-On at 200% 35.35 Sep 30 - HOS reaches new high of 37.49 Sep 29 - OSX index 150% reaches…
Summary of 2006 Convertible Notes Offering Illustration of Convertible Financing Versus Alternative Sources of Capital 20.0% Reference: Common 18.0% Stock 16.0% 7-yr Pre-Tax Cost of Capital Reference: HY Debt 14.0% (7.25%…
Summary of 2012 Convertible Notes Offering Opportunistic financing in Aug-2012 allowed HOS to monetize its high stock volatility and strong credit profile Low-cost source of capital available to HOS resulting in 425 bps less cash…
HOS vs. Historical Spreads of Energy High Yield Bonds (%) 20% 18% 16% 14% Economic downturn increases cost of debt capital 12% HOS Notes due 2020 5.875% yield HOS Notes due 2014 HOS Notes due 2021 10% + 432 bp spread 6.125%…
Historical Credit Statistics Leverage Ratio1 Coverage Ratio1 12.0x 6.0x Interest Coverage Ratio 5.0x 10.0x Leverage Ratio 4.0x 8.0x 3.0x 6.0x 2.0x 4.0x 1.0x 2.0x 0.0x 0.0x Debt to Adjusted EBITDA Net Debt to…
HOS Common Stock Historical Trading Multiples TEV / Forward EBITDA Multiples 14.0x 2 Follow-On 9.4x 1 12.0x IPO Hist High 4 9.1x 11.6x Follow-On 6.9x 10.0x 8.0x HOS Hist. Avg 7.3x 6.0x 4.0x 3 Buy-Back 5.8x Hist Low…
HOS Common Stock Historical Trading Multiples Stock Price / Forward Earnings (P/E) Multiples 46.0x 1 IPO 42.0x 41.8x nmf due to neg eps 38.0x 34.0x 2 Follow On 30.0x 19.0x 3 26.0x Buy-Back 22.0x 11.6x HOS Hist Avg 16.5x…
Current OSV Peer Group Trading Multiples Closing % of % of Equity Diluted Price 52 Week Book Market Shares Book Total Preferred Minority Enterprise Company Ticker 11/04/2014 High Equity Cap. mm Equity Debt Stock Interest Cash Value…
Equity Analyst Coverage 16 14 12 Covering Analysts 10 8 6 4 2 0 TDW CKH GLF HOS TDW CKH GLF HOS Argus Credit Suisse Capital One Southcoast Capital One Southcoast Capital One Southcoast ISI Group Carnegie Investment Bank…
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