Magseis ASA Q3 · PDF fileterritorial waters,” Saudi Aramco said in its latest annual...
Transcript of Magseis ASA Q3 · PDF fileterritorial waters,” Saudi Aramco said in its latest annual...
Magseis ASA Q3 2017 2nd November 2017
Highlights
Another strong quarter
Operational Performance2 Crews
Continuous focus on more efficient and cost effective
solution
Further growth, backlog and outlook
2
• Negotiations ongoing for the extension in the Red Sea, high tender activity.
• New cable vessel planned for late Q2 2018 start-up date
• Strong financial performance: Revenue of USD 28.7m and EBITDA of USD 13.9m• Revised EBITDA guidance to USD 24 - 26m for the full year, up from USD 20m
• Mobile ROV more efficient than expected, strong industry interest
• Positive results from the Source IsolationTM test
• Completed the Mobile ROV operation for ConocoPhillips in the North Sea
• Completion of the S-78 Extension in the Red Sea expected Mid-November
Source: Magseis
KEY FIGURES Q3 2017
Source: Magseis
28.7REVENUE
13.9EBITDA
9.7NET PROFIT
45.4CASH BALANCE
$ MILLION
$ MILLION $ MILLION
$ MILLION $ MILLION
28.7
REVENUE
Q3 2017
13.1
REVENUE
Q32016
13.9
EBITDA
Q32017
EBITDA
Q32016
3.0
3
Third quarter and first nine months 2017- Key figures
4Source: Magseis
Revenue 28 650 13 094 69 125 38 881
Cost of sales 11 590 7 660 30 246 27 928
EBITDA 13 923 2 993 30 650 2 973
EBIT 8 845 -6 975 18 317 -13 009
Net profit/loss 9 660 -8 841 16 484 -16 754
Basic earnings per share 0.16 -0.23 0.27 -0.44
Financial position
Cash 45 427 13 471
Working Capital1) 11 429 5 933
Total equity 104 775 48 909
Equity ratio 80.6% 56.1%
Gross interest bearing debt 9 762 19 573
Cash flow
Profit and loss Q3 2017 Q3 2016 YTD 2017 YTD 2016
1): Working Capital defined as Trade Receivables less Trade Payables
Net cash from operating activities 21 777 -10 755
Net cash from investing activities -27 072 -16 165
Net cash from financing activities 31 748 28 956
• USD 28.7 million in Revenues• Revenue resulting from strong operational performance on
both Red Sea and ConocoPhillips projects
• Very strong EBITDA performance at USD 13.9 million
• Total Amortisation of USD 2.6m during the quarter
• Closing cash position of USD 45.4 million • Equity ratio 80.6%
• Working Capital decrease• Advantageous payment terms on both Red Sea and Conoco
project during Q3• Small increase in payables
• Full-year guidance revised• Expected EBITDA for 2017 of USD 24-26 million
OBS provides superior image quality - gaining market share over high-end streamer seismic
Streamer Seismic Ocean Bottom Seismic (OBS)
80%Market share
20%Market share
5Source: Magseis/Statoil
MASS technology - Marine Autonomous Seismic System
Miniaturised node sensors Handling system Applications
ROV deployment
Ultra deep water deployment
Cable deployment
6
• Highest spec sensor on the market
• Smart, light, robust and easy-to-handle node
• Superior logistics and efficiency
• Automated handling system
Source: Magseis
MASS Cable
MASS Modular/ROV
MASS Ultra Deep Water
New, exclusive source technology agreement- Significant potential to reduce costs further
Improved efficiency and data quality by new Source Isolation technology
• Reducing number of source vessel sail lines
• Increasing image quality, higher resolution and larger fold
• Exclusive agreement for OBS
• Field test conducted August 2017
• Commercially available in 2018
7
Source Isolation Conventional shooting25m 50m
Source: Magseis
New, exclusive source technology agreement- Significant potential to reduce costs further
Source: Magseis
Nodes deployed on seabed Conventional shooting 7 sail lines Source Isolation 7 sail lines
Source: Magseis
Red Sea project (S-78)
9
Operational highlights• Good operational performance on S-78 Extension due to good
cooperation with BGP
• Project completion delayed due to standby caused by other activities in the area
• Expected completion Mid November
• Q4 will be marked by redeployment of equipment, yard stay and some potential idle time between projects
• Revenue in Q4 estimated at USD 4-6m, potential upside if next project can commence earlier than indicated by the client
Source: Magseis, NASA
Red Sea Exploration
10
Saudi Aramco was the first to use a deepwater rig in the Red Sea region after a 15-month seismic study in 2009 indicated the presence of natural gas. The company discovered three oil and two gas fields in 2013.
(Abdelghani Henni, HartsEnergy)
“We continue our program to explore the shallow waters of the Red Sea, completing our largest single survey of the seabed encompassing Saudi Arabian territorial waters,” Saudi Aramco said in its latest annual report (2016). (Abdelghani Henni, HartsEnergy)
State-owned Saudi Aramco is hoping that innovative seismic acquisition technology will help the company to successfully explore the geologically complex sub-salt of the ecologically sensitive Red Sea.
The operator had said its share of Red Sea oil and gas resources had the potential to boost Saudi Arabia’s reserves base by more than 30%.
(Saleh Al Saleh, Upstream online)
Red Sea
The new city called “NEOM” will be
developed within this region
ConocoPhillips Eldfisk project
11
• First full scale Mobile ROV operation
• 3000 MASS nodes and 2 ROVs
• Project completed within schedule and budget
• Using ROV vessel and Source vessels already on charter with ConocoPhillips
• Delivering a high-quality 4D OBS survey to our client at a substantially lower cost
• Operational efficiency can be improved further by deploying more MASS nodes and faster ROVs
Source: Magseis
MASS Modular
12
High capacity, mobile ROV operation
• Containerised, modular system
• Can be rigged up/down within 1 week on vessels of opportunity or onshore
• Unlimited number of nodes can be deployed
• Efficiency comparable to high-end cable based deployment platforms
• Commercially available, participating in several tenders -> Target of 2-4 ROV projects during 2018
Source: Magseis
Vessel #2 preparations ongoing
Source: Magseis13
• 6,000 MASS sensors in production, long-lead components for handling system ordered
• Detailed design for chosen vessel ongoing
• Target start of operations during Q2 2018• Bidding on projects for 2018 H2
Ramping up capacity to meet market growth:
Source: Magseis14
• MASS node inventory growing from 5,000 to 14,000 by Q1 2018
• Critical long-lead components for an additional 6,000 has been secured, enabling Magseis to reach 20,000 MASS nodes by YE 2018
• Firmly establishing Magseis as a joint industry leader in terms of OBS node capacity
• Strategic focus on maximising the utilisation of our MASS nodes and Return On Capital Employed
20192016 2017 2018
MASS Node Inventory
30 000
25 000
20 000
15 000
10 000
5000
0
Committed orders for complete MASS nodesSecured, critical long-lead itemsPlanned
Source: Magseis/Arkwright/Rystad Energy/Statoil15
Strong market outlook
20202019201820172005 2016
2 250
2 000
1 575
1 500
1 250
1 000
750
500
250
0
USD>750 m
$ MILLION
Third quarter and first nine months 2017- Comprehensive income • Revenue
• USD 28.7m, strong performance on the Aramco S-78 and ConoccoPhillips projects
• Cost of sales • Full quarter of production• Amortisation of capitalised mobilisation and yard costs
(net effect of USD 2.6m during Q3)• Aramco startet end of July in Q3 last year (capitalised cost til 1.shot)
• Depreciation• Amortisation of capitalised mobilisation and yard cost USD 0.9m
• Amortisation and Impairment• No impairment in the third quarter
• Finance • Primarily interest related to GIEK and
Innovation Norway
• Tax• USD 0.5m for withholding tax in Saudi Arabia
In USD thousands Q3 2017(unaudited)
YTD 2017(unaudited)
Q3 2016(unaudited)
YTD 2016(audited)
16
Revenue 28 650 69 125 13 094 38 881Cost of sales 11 590 30 246 7 660 27 193Research and development 494 1 507 268 1 529SG&A and other expenses 2 643 6 721 2 173 7 185EBITDA 13 923 30 650 2 993 2 974Depreciation 4 962 11 753 3 087 7 658Amortisation 116 347 133 1 276Impairment 0 233 6 748 7 047EBIT 8 845 18 317 -6 975 -13 008Net interest and fx (gain)/loss -1 309 -287 426 1 020Other finance cost - - - -Net finance costs -1 309 -287 426 1 020EBT 10 154 18 604 -7 401 -14 028Tax 493 2 121 1 440 2 725Net income 9 660 16 484 -8 841 -16 753Currency translation differences 0 0 0 0Total comprehensive income 9 660 16 484 -8 841 -16 753
Source: Magseis
Third quarter and first nine months 2017- Balance sheet
• Trade receivables comprising BGP/Aramco and ConocoPhillips
• 50% of August and 100% of September production (paid in Q4)
• Equity ratio of 80.6%• Debt covenants at 30%
• Non-current liabilities• Senior debt drawn down from Export Credit Norway and
Innovation Norway: USD 6.4m• Shell Deep Water R&D funding: USD 7.0m (contingent liability)
• Current tax liabilities– Withholding tax Saudi Arabia– Corporate tax in Singapore and Sweden
• Other current liabilities– Current portion of long-term debt USD 3.4m
In USD thousands YTD 2017(unaudited)
YTD 2016(unaudited)
17
Equipment and other intangibles 64 234 50 153Multi-client library 0 0Cash and cash equivalents 45 427 13 471Trade receivables 16 394 12 909Stock (fuel and batteries) 908 1 763Other current assets 2 964 8 916TOTAL ASSETS 129 927 87 213
Share capital 438 303Share premium 141 486 102 594Retained earnings and other reserves -37 149 -53 989TOTAL EQUITY 104 775 48 909
Obligation under finance lease 181 1 197Other non-current financial liabilities 13 482 13 293TOTAL NON-CURRENT LIABILITIES 13 662 14 490
Trade payables 4 965 6 976Current tax liability 721 189Other current liabilities 5 804 16 649TOTAL CURRENT LIABILITIES 11 490 23 814
TOTAL LIABILITIES 25 152 38 304
TOTAL EQUITY AND LIABILITIES 129 927 87 213
Source: Magseis
Third quarter and first nine months 2017- Cash flow
18
• Cash flow from operations• Decrease in working capital resulting from:
• Advantageous payment terms on both Red Sea and Conoco project during Q3
• Small increase in payables
• Cash flow from investments• Relates mainly to investments in nodes for vessel #2
• Cash flow from financing • Instalments of USD 0.7m
Earnings before tax 10 078 18 604 -7 401 -14 028Depr, Amor,Impair,Finance, etc. 3 903 10 125 10 467 16 789Net working capital adjustments 7 128 -6 952 -9 885 -13 515Net cash flow from operating activities 21 109 21 777 -6 819 -10 754
Net cash flow from investing activities -8 796 -27 072 -5 451 -16 165
Net cash flow from financing activities -619 31 748 8 886 28 956
Net change in cash and cash equivalents 11 694 26 453 -3 384 2 036Cash balance at the beginning of the period 33 657 18 974 16 855 11 435Cash balance at period end 45 351 45 427 13 471 13 471
In USD thousands Q3 2017(unaudited)
YTD 2017(unaudited)
Q3 2016(unaudited)
YTD 2016(audited)
Source: Magseis
Magseis - well positioned for further growth in 2018
19
Strong OperationalPerformance
Strong Pipeline
Flexible Operating Platform
MASS TechnologyUnrivalled flexibility and capacity in the 4D marketSource Isolation technology targeting 30-50% acquisition cost reduction
Succesfull introduction of MASS Modular with ROV deployment for ConocoPhillipsImpressive operations in challenging conditions in the Red SeaHigh probability for repeat business
Vessel #2 targeting large surveys with increased efficiencyMASS Modular targeting 4D surveys and shallow water
Several active tenders in key markets (capacity already tied-up on awarded projects)Strong focus on 4D and IOR
20