November 9, 2016
PERFORMANCE IN LINE WITH GUIDANCE
Highlights
- Year-to-date 2016 Directional[1] revenue on track at US$1.6
billion.
- US$193 million order intake year to date.
- Third Quarter 2016 uptime at 99.2%.
- FPSO Cidade de Saquarema on hire as of July 8, 2016.
- FPSO Turritella on hire as of September 2, 2016.
- Brazilian Fifth Chamber referred settlement agreement to the
Higher Council of the Ministério Público Federal ("MPF"), for
further consideration and decision.
- Reiterating 2016 Directional1 revenue and EBITDA guidance of at
least US$2.0 billion and around US$750 million, respectively.
- EUR150 million share repurchase program well underway.
Bruno Chabas, CEO of SBM Offshore commented:
"This quarter saw the successful delivery of two
complex FPSOs to our clients. The scale and technological
challenges of delivering these projects in line with client
schedule and to budget were very significant. I am very proud to
see that dedicated SBM Offshore staff demonstrated once again that
experience matters, by exceeding expectations.
Business across the offshore industry remains
slow, with low order intake. Visibility on new awards continues to
be limited, even though interest is picking up with the realization
that the turning point in oil supply/demand is close and that
structural undersupply is likely only to be a matter of time.
Client feedback on our game changing Fast4WardTM product is very
positive. This innovation combined with our ongoing restructuring
and optimization program give us confidence we have a credible
solution to work profitably in a low oil price environment."
Financial Highlights
|
|
YTD Directional1 |
|
YTD IFRS |
|
|
|
|
|
|
|
|
|
in US$ million |
|
3Q 2016 |
3Q 2015 |
% Change |
|
3Q 2016 |
3Q
2015 |
% Change |
Revenue |
|
1,574 |
2,059 |
|
-24 |
% |
|
1,822 |
2,055 |
|
-11 |
% |
Turnkey |
|
622 |
1,252 |
|
-50 |
% |
|
921 |
1,320 |
|
-30 |
% |
Lease and Operate |
|
952 |
807 |
|
18 |
% |
|
901 |
735 |
|
23 |
% |
|
|
|
|
|
|
|
|
|
in US$ billion |
|
Sep-30-16 |
Dec-31-15 |
% Change |
|
Sep-30-16 |
Dec-31-15 |
% Change |
Backlog |
|
17.5 |
18.9 |
|
-7 |
% |
|
- |
- |
NM |
Net Debt |
|
3.0 |
3.1 |
|
-4 |
% |
|
5.1 |
5.2 |
|
-1 |
% |
Year-to-date 2016 Directional1 revenue came in
at US$1,574 million versus US$2,059 million in the year-ago period.
For the Turnkey segment, revenue decreased 50% year-on-year
to US$622 million, reflecting the slow-down in activity due to
continued difficult oil and gas market conditions, as well as the
sale to JV partners of a 45% stake in FPSO Turritella in the first
half of 2015. The Lease and Operate revenue increased 18% versus
the same period last year to US$952 million, due to the
commencement of production of FPSO Cidade de Maricá which was on
hire commencing February 7, 2016, FPSO Cidade de Saquarema which
was on hire on July 8, 2016, FPSO Turritella which was on hire
commencing September 2, 2016 and the contribution of the Production
Handling Agreement signed in September 2015 with Noble to connect
the Big Bend and Dantzler fields to the Thunder Hawk DeepdraftTM
Semi in the U.S. Gulf of Mexico.
Directional1 Backlog as of September 30, 2016
stood at US$17.5 billion. The Company added US$ 193 million in new
orders related to FEED, terminals and offshore installation
contracts and contract close-outs. Although SBM Offshore is
actively involved in several tenders for FEED studies and final
awards, it remains cautious on order intake in view of the
continuing downturn in the oil and gas industry.
Proportional net debt as of September 30, 2016
amounted to US$3.0 billion, a decrease of 4% compared to the end of
December 2015. This predominantly reflects an increase in cash flow
generated by the Lease and Operating segment and upfront payments
received from clients, more than offsetting the decreasing capital
expenditure in the Turnkey segment and the Company's share
repurchase program.
Directional1 capital expenditure for the year to
date amounted to US$35 million. Full year 2016 Directional1 capital
expenditure, net of upfront client payments, has been revised from
US$70 million to US$50 million. The year to date and reduced full
year forecast reflect good project progress and release of
contingencies in closing out Turnkey projects.
Project Review
FPSO Cidade de Saquarema (Brazil)
FPSO Cidade de Saquarema achieved first oil and
completed a 72-hour continuous production test leading to final
acceptance. The vessel was formally on hire on July 8, 2016.
The FPSO achieved its operational milestone "flare out" on
September 20. The charter contract for the vessel includes an
initial period of 20 years.
FPSO Turritella (US Gulf of Mexico)
FPSO Turritella was formally on hire as of
September 2, 2016 after achieving Commencement of Commercial
Production (CoCP). The CoCP certificate was issued on
September 8, 2016. The lease and operate contract includes an
initial period of 10 years with future extension options up to a
total of 20 years.
Turrets and Mooring systems
Commissioning continues in accordance with
client's schedules and contractual planning for the two large,
complex turrets for Prelude FLNG and FPSO Ichthys. The Prelude
turret finalization date, previously foreseen for 2016, will be
aligned with client execution schedule.
Operational Uptime
The Company's fleet recorded 99.2% uptime for
the third quarter, which brings the year-to-date uptime to
96.4%.
FSO Serpentina Extension
The operating and maintenance contract on FSO
Serpentina was extended on August 1, 2016 for a period of 6 months
from the previous termination date of August 14, 2016 to February
14, 2017.
Compliance
The Brazilian Fifth Chamber upheld its decision
of September 1, 2016 in which the Leniency Agreement, as per the
current terms, was not approved, and referred the matter, including
review of the appeals filed by the General Counsel for the Republic
(Advocacia Geral da União - "AGU") and the Public Prosecutor's
Office (Ministério Público Federal - "MPF"), to the Higher Council
of the MPF (Conselho Institutional) for further consideration and
decision.
The Company remains committed to engage with all
relevant authorities until the Leniency Agreement is approved by
the Fifth Chamber. Until it is binding upon all parties, the
Company is not under any obligation to make payments under the
Leniency Agreement.
The Leniency Agreement further remains subject
to review by the Federal Court of Accounts (Tribunal de Contas da
União - "TCU"), which is not a condition precedent to the Leniency
Agreement.
It is currently not possible to predict the
timing or final outcome of these developments, and the Company will
update the market accordingly.
YME Decommissioning
The Yme platform was decommissioned, taken off
station and handed over to SBM Offshore on August 22, 2016.
The platform was subsequently transported and placed onshore
at a yard in Norway on September 12, where the platform will be
disassembled.
New Research and Development Laboratory
On October 12, 2016, SBM Offshore has officially
inaugurated its new R&D facilities at Carros - Le Broc, near
Nice in France. The laboratory covers 2,300 m2, and will
cater to a variety of testing and research requirements across the
Company's product lines in new technological developments.
Dow Jones Sustainability Index ("DJSI")
On September 19, 2016, SBM Offshore was
reconfirmed in the DJSI, for the seventh consecutive year.
The 2016 entry score of 81 out of 100 demonstrates that the
Company is recognized as an "Industry Leader" in the Energy
Equipment and Services sector.
Share Repurchase Program
On August 11, the Company initiated a EUR 150
million share repurchase program. As of November 4, the Company had
repurchased 6,971,000 shares at an average share price of EUR
12.73, equal to 59% of the total repurchase program.
Release of Pre-Completion Corporate Guarantees
The release of pre-completion corporate
guarantees associated with project financings with respect to the
three FPSOs Cidade de Maricá, Cidade de Saquarema and Turritella is
ongoing. Reflagging of FPSOs Cidade de Maricá and Cidade de
Saquarema to Panama, as a condition prior to release of the
guarantees, has been completed in September 2016. Release of the
pre-completion corporate guarantees is expected to be completed in
the fourth quarter of 2016.
Floating Wind Pilot Project
Having supplied more than 100 floating
production and more than 450 offshore mooring systems over almost
60 years, SBM Offshore is the technology leader for floating and
mooring solutions for the energy industry. SBM Offshore is looking
at deploying its technology in floating wind projects as these
require strong offshore experience and expertise.
On November 4, 2016 the French Government
announced that it has selected the EDF Energies Nouvelles (EDF EN)
proposal to construct a pilot floating wind farm for its Provence
Grand Large project, offshore France. SBM Offshore's proprietary
floating systems solution for offshore wind turbines will be
deployed on this EDF EN project. The pilot project remains subject
to the client's final investment decision.
The scope for SBM Offshore would involve
engineering, procurement, construction and installation services of
the floating and mooring components for three floating wind
systems. The execution planning remains subject to discussions with
EDF EN, authorities and other project stakeholders. The Company
would supply the floaters' components on a turn-key basis.
Outlook and Guidance
The Company is reiterating its 2016 Directional1
revenue guidance of at least US$2.0 billion, of which US$0.6-0.7
billion is expected in the Turnkey segment and US$1.3-1.4 billion
in the Lease and Operate segment. The Company also reconfirms
the 2016 Directional1 EBITDA guidance of around US$750 million.
Conference Call
SBM Offshore has scheduled a conference call
followed by a Q&A session at 18:30 Central European Summer Time
on Wednesday, November 9, 2016.
The call will be hosted by Bruno Chabas (CEO),
Peter van Rossum (CFO) and Erik Lagendijk (CGCO). 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 327425#
until December 9, 2016.
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, 2015, Group companies employ
approximately 7,000 people worldwide. Full time company
employees totaling 4,900 are spread over five regional centres,
eleven operational shore bases and the offshore fleet of
vessels. A further 2,100 are working for the joint ventures
with several construction yards. 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,
November 9, 2016
Financial Calendar |
Date |
Year |
Extraordinary General Meeting of Shareholders |
November 30 |
2016 |
Full-Year 2016 Earnings - Press Release |
February 8 |
2017 |
Annual General Meeting of Shareholders |
April 13 |
2017 |
Trading Update 1Q 2017 - Press Release |
May 10 |
2017 |
Half-Year 2017 Earnings - Press Release |
August 8 |
2017 |
Trading Update 3Q 2017 - Press Release |
November 7 |
2017 |
For further information, please contact:
Investor RelationsBert-Jaap
DijkstraInvestor Relations Director
Telephone: |
+31 (0)
20 236 322 |
Mobile
NL:Mobile MC: |
+31 6
2114 1017+33 6 4391 9302 |
E-mail: |
bertjaap.dijkstra@sbmoffshore.com |
Website: |
www.sbmoffshore.com |
Media RelationsVincent KempkesHead of
Communications
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.
Attachments:
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