May 10, 2017
REVENUE ON TRACK; REITERATING GUIDANCE
Highlights
- Year-to-date 2017 Directional[1] revenue in line with
Management expectations at US$420 million
- New 5-year Operating and Maintenance contract signed for
FPSO Serpentina
- Increased dividend of US$ 0.23 per share as compared to US$0.21
last year (up c.17% in Euros), to be paid on May 12, 2017
- Reiterating 2017 Directional revenue and EBITDA guidance of
around US$1.7 billion and around US$750 million, respectively
Bruno Chabas, CEO of SBM Offshore commented:
"Today we report revenues which are in-line with
full year guidance. The results underline the importance of the
Lease and Operate segment, the revenues of which are not oil price
dependent and are contractually secured for many years to come.
This segment's quarterly revenues have grown c. 30% compared to Q1
2016 driven by the new FPSO deliveries during the course of last
year. The decrease in Turnkey compared to the same period last year
was expected based on the low order intake since the oil price
downturn. Based on our engagement with clients, we see signs of
recovery for the deepwater market in the medium term, albeit, as
previously stated, we see that structurally the market is unlikely
to return to historical levels. In this environment, the strength
of our Lease and Operate business leaves us well positioned and
enables us to maintain a commercially disciplined approach. On the
basis of the solid performance of our lease fleet, I am pleased to
reiterate full-year guidance, which includes overall EBITDA at a
similar level to last year."
Financial Highlights
Year-to-date 2017 Directional revenue came in at
US$420 million versus US$442 million in the year-ago period. This
decrease was driven by the low Turnkey activity level as the last
major projects were delivered in 2016. Revenues from the Lease and
Operate segment increased due to the additions to the fleet during
2016, which largely offset the Turnkey decrease.
Directional Turnkey segment revenue decreased by
72% to US$42 million, while Lease and Operate segment revenue
increased 29% from the year-ago period to US$378 million. The
growth in Lease and Operate revenue is mostly attributable to the
fact that the 2016 delivered FPSOs Cidade de Maricá, Cidade de
Saquarema and Turritella contributed to the result during the first
quarter in 2017.
Compared to end December 2016, proportional net
debt as of March 31, 2017 decreased slightly to just below US$3.1
billion. Cash flow from Lease and Operate was mainly allocated to
interest and loan redemption, acquisition of a vessel, structural
expenses and the planned decrease in trade payables associated with
the 2016 FPSO deliveries.
Lease fleet
FPSO Serpentina (Equatorial Guinea)
On March 3, 2017, GEPsing - a joint venture
company between SBM Offshore (60%) and the National Oil Company of
Equatorial Guinea, GEPetrol (40%) - was awarded a new 5-year
contract by MEGI (Mobil Equatorial Guinea Inc.) to operate and
maintain the FPSO Serpentina with effective date April 1, 2017.
FPSO Serpentina is located on the Zafiro field offshore Equatorial
Guinea and is owned by MEGI. Constructed by SBM Offshore, the FPSO
achieved first oil in July 2003 and operates at a water depth of c.
500 meters with a maximum throughput capacity of 110,000 bopd.
GEPsing also operates FPSO Aseng.
Compliance
Discussions with the Brazilian authorities and
Petrobras regarding the Leniency Agreement signed on July 16, 2016,
that was subsequently sent back by the Brazilian Fifth Chamber to
the Public Prosecutor for adjustments, are ongoing. The Leniency
Agreement is also under review by the Federal Court of Accounts
(Tribunal de Contas da União).
Under the current interpretation of the tender
rules in Brazil, the Company can participate in tenders, but it
cannot be awarded a contract until the Leniency Agreement is final.
The Company challenges this position as it considers this situation
to be unsatisfactory in light of its ongoing efforts to reach a
final resolution.
In the United States, the Company discussions
with the Department of Justice ("DOJ") are advancing. These regard
the investigation the DOJ had closed in November 2014 and reopened
early 2016 and its inquiry into Unaoil, a company that SBM Offshore
had engaged as an agent prior to 2012 in relation to delivery of
barges, offshore terminals and maintenance.
Pending the discussions with the Brazilian
authorities and the DOJ, the Company cannot provide further clarity
or assurance on the outcomes of these discussions, or on the timing
thereof.
Post-Period Events
Dividend
On April 13, 2017, the Annual General Meeting of
Shareholders (AGM) voted in favor of the proposed US$0.23 per
ordinary share dividend distribution. Dividends are to be paid in
Euros using an exchange rate of 1.0655, which equates to €0.2159
per ordinary share and represents an increase of 17% compared to
the previous year. The cash dividend will be paid on May 12, 2017
to all shareholders of record as of April 20, 2017.
Share cancellation
Pursuant to a resolution by the AGM on April 13,
2017, SBM Offshore has started the formal process for cancellation
of 7.8 million ordinary shares. These shares are currently held in
treasury by the Company resulting from the share repurchase program
which was completed in 2016. Remaining shares will be held in
treasury as these will be allocated to employee share programs or
may be cancelled at a later moment in time.
Outlook and Guidance
As anticipated, the offshore oil and gas market
continues to show early signs of recovery, with a gradual
improvement expected over time. Management maintains its positive
medium and long-term outlook as deep water development has
significantly improved in competitiveness and as such is likely to
remain an indispensable energy source for the foreseeable
future.
The Company is reiterating its 2017 Directional
revenue guidance of around US$1.7 billion, of which around US$1.5
billion is expected in the Lease and Operate segment and around
US$0.2 billion in the Turnkey segment. The Company also confirms
the 2017 Directional EBITDA guidance of around US$750 million.
Conference Call
SBM Offshore has scheduled a conference call
followed by a Q&A session at 10:00 am Central European Summer
Time on Wednesday, May 10, 2017.
The call will be hosted by Bruno Chabas (CEO),
Philippe Barril (COO), Erik Lagendijk (CGCO) and Douglas Wood
(CFO). Interested parties are invited to listen to the call
by dialing +31 (0) 20 531 5851 in the Netherlands, +44 (0) 20 3365
3210 in the UK or +1 866 349 6093 in the US.
A replay will be available shortly after the end
of the conference call. Interested parties can listen to the replay
by dialing +31 (0) 20 530 0220 and using access code 658643# until
June 10, 2017.
Corporate Profile
SBM Offshore N.V. is a listed holding company
that is headquartered in Amsterdam. It holds direct and indirect
interests in other companies that collectively with SBM Offshore
N.V. form the SBM Offshore group ("the Company").
SBM Offshore provides floating production
solutions to the offshore energy industry, over the full product
life-cycle. The Company is market leading in leased floating
production systems with multiple units currently in operation and
has unrivalled operational experience in this field. The Company's
main activities are the design, supply, installation, operation and
the life extension of Floating Production, Storage and Offloading
(FPSO) vessels. These are either owned and operated by SBM Offshore
and leased to its clients or supplied on a turnkey sale basis.
As of December 31, 2016, Group companies employ
approximately 4,750 people worldwide. Full time company employees
totaling c. 4,250 are spread over five regional centers, ten
operational shore bases and the offshore fleet of vessels. A
further 500 are working for the joint ventures with several
construction yards. For further information, please visit our
website at www.sbmoffshore.com.
The companies in which SBM Offshore N.V.
directly and indirectly owns investments are separate entities. In
this communication "SBM Offshore" is sometimes used for convenience
where references are made to SBM Offshore N.V. and its subsidiaries
in general, or where no useful purpose is served by identifying the
particular company or companies.
The Management BoardAmsterdam, the Netherlands,
May 10, 2017
Financial Calendar |
Date |
Year |
Half-Year 2017 Earnings - Press Release |
August 8 |
2017 |
Trading Update 3Q 2017 - Press Release |
November 7 |
2017 |
Full-Year 2017 Earnings - Press Release |
February 7 |
2018 |
Annual General Meeting of Shareholders |
April 11 |
2018 |
For further information, please contact:
Investor RelationsBert-Jaap DijkstraInvestor Relations
Director
Mobile
NL:Mobile MC: |
+31 (0)
6 2114 1017+33 (0) 6 4391 9302 |
Telephone: |
+377
9205 1732 |
E-mail: |
bertjaap.dijkstra@sbmoffshore.com |
Website: |
www.sbmoffshore.com |
Media Relations Vincent KempkesGroup
Communications Director
Telephone: |
+31 (0)
20 2363 170 |
Mobile: |
+31 (0)
6 25 68 71 67 |
E-mail: |
vincent.kempkes@sbmoffshore.com |
Website: |
www.sbmoffshore.com |
Disclaimer
This press release contains inside information
within the meaning of Article 7(1) of the EU Market Abuse
Regulation. Some of the statements contained in this release
that are not historical facts are statements of future expectations
and other forward-looking statements based on management's current
views and assumptions and involve known and unknown risks and
uncertainties that could cause actual results, performance, or
events to differ materially from those in such statements. Such
forward-looking statements are subject to various risks and
uncertainties, which may cause actual results and performance of
the Company's business to differ materially and adversely from the
forward-looking statements. Certain such forward-looking statements
can be identified by the use of forward-looking terminology such as
"believes", "may", "will", "should", "would be", "expects" or
"anticipates" or similar expressions, or the negative thereof, or
other variations thereof, or comparable terminology, or by
discussions of strategy, plans, or intentions. Should one or more
of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially
from those described in this release as anticipated, believed, or
expected. SBM Offshore NV does not intend, and does not assume any
obligation, to update any industry information or forward-looking
statements set forth in this release to reflect subsequent events
or circumstances. Nothing in this press release shall be deemed an
offer to sell, or a solicitation of an offer to buy, any
securities.
[1] Directional view is a non-IFRS disclosure, which assumes all
lease contracts are classified as operating leases and all vessel
joint ventures are proportionally consolidated.
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