0 Full Year Results 2014 19 March 2015 www.lamprell.com 0 Nexen PUQ and wellhead
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
0
Full Year Results 2014
19 March 2015
www.lamprell.com
0
Nexen PUQ and wellhead
Disclaimer
www.lamprell.com 1
This presentation contains certain forward-looking statements relating to the business, financial performance and results of the Company and/ or the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words “believes”, “expects, “predicts”, ”intends”, “projects”, “plans” “estimates”, “aims”, “foresees”, anticipates”, “targets” and similar expressions. The forward-looking statements, contained in this document, including assumptions, opinions and views of the Company or cited from third party sources are solely opinions and forecasts which are uncertain and subject to risks. A multitude of factors can cause actual events to differ significantly from any anticipated development. Neither the Company nor any of its officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does any of the foregoing accept any responsibility for the future accuracy of the opinions expressed in this document or the actual occurrence of the forecasted developments.
No representation or warranty (express or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and, accordingly, neither the Company nor any of its subsidiary undertakings nor any such person’s officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document.
Agenda
www.lamprell.com 2
1 Highlights
2 Financial Review
3 Operational Review and Market Environment
4 Summary and Outlook
5 Appendices
Offshore platforms: Jalilah B
Highlights Jim Moffat, CEO
2014: a year of significant progress on every level
www.lamprell.com 4
Strong financial position:
Exceptional financial performance
Improved underlying margins on the back of strong
operational performance
Significantly strengthened balance sheet
Important operational milestones:
Record number of major deliveries
Strong project execution
All legacy projects now completed
World-class safety performance
Strategy implementation:
Improved pipeline as a result of new marketing strategy
Significant contract awards, from new clients and repeat
orders
Project Evolution delivering early savings
$5.2bn Bid Pipeline
0.28 TRIR**
Safety
$272.6m Net Cash
$93.2m Net profit*
* From the Group’s continuing operations
** Total Recordable Injury Rate
5
Greatdrill Chaaru
www.lamprell.com
Financial Review Tony Wright, Deputy CFO
2014 Financial highlights
Flat revenue at $1,085m (2013: $1,073m)
EBITDA almost doubled to $137m (2013: $76m)
Significantly improved EBITDA margin of 12.6% (2013: 7.1%)
Underlying net profit of $93.2m (2013: $36.7m)
Adjusted for exceptionals, total profit attributable to equity holders of $118.1m (2013: $36.4m)
Earnings per share tripled to $37.4c ($12.7c)
Strong balance sheet as a result of the rights issue and refinancing
Net cash of $272.6m (2013: $183.8m)
www.lamprell.com 6
Strong profitability driven by operational performance
Year of exceptional financial performance
EDC “Mercury”
Outstanding financial performance
www.lamprell.com 7
Material improvement in profitability FY 2013 to FY 2014
Strong project execution resulted in improved margins
Cost savings from overhead reductions and early results of Project Evolution
Exceptionally high margins not expected to be maintained in 2015 due to project
phasing, exceptionals and market environment
36.7
93.2
8.4
22.1 18.7 25.2
19.5
-
10
20
30
40
50
60
70
80
90
100
2013 Net Profit Exceptional itemsin 2013
Impact of EDC 2 One off expensesin 2014
Project profitimprovements
Lower overheads 2014 Net Profit
Strong cash position
www.lamprell.com 8
Significant contribution from the rights issue and sale of Inspec
At working capital sweet spot at end 2013; draw on working capital in 2014 due to phasing
Cash position to improve in H1 before trending downwards
Ongoing investment of Rights Issue proceeds in Project Evolution (majority in 2015)
183.8
272.6
59.3
111.0 (193.8)
161.6 (49.3)
-
50
100
150
200
250
300
350
400
Net cash as at 31Dec 2013
Proceeds fromdisposal of
Inspec
Proceeds fromrights issue
Movement inworking capital
Operating cashflows
Asset additions /other
Net cash as at 31Dec 2014
Significantly strengthened balance sheet
www.lamprell.com 9
31 Dec 14
$m
31 Dec 13
$m
Total assets 1,154.3 1,074.6
Net assets 672.2 442.8
Gross cash 371.6 344.6
Available cash* 299.8 275.5
Net cash 272.6 183.8
Financial firepower to support strategy implementation
Proceeds from Rights Issue to fund Project Evolution (underway)
Committed facilities enable greater commercial flexibility
Significant headroom to support growth
$20 million term loan repayment due in 2015
* Gross cash less cash deposits under lien, less cash deposits with maturity >3 months.
Debt package $m
Term loan 100
Working capital facility 50
Revolver 200
Total funded facilities 350
Committed bonding 250
Financial Summary
Strong financial performance in 2014 with
earnings ahead of initial expectations
Improved operational performance a major
driver
FY closing backlog of $1.2bn (Dec 13:
$0.9bn)
Approximately 80% of 2015 revenue
covered
Significantly improved balance sheet and
liquidity to help maintain competitive
position
www.lamprell.com 10
Robust financial position in challenging times
Nexen PUQ
11
www.lamprell.com
Offshore platforms:
Leighton topsides & jackets
Operational Review and Market Environment James Moffat, CEO
High levels of activity in 2014
Nine major orders delivered:
• Largest rig conversion completed
• All legacy projects now delivered
Land rigs and E&C performed well
Lower activity levels in offshore construction
6 jackup orders won
• Major repeat order from NDC, with three options
• Orders from new clients (Ensco, Shelf)
• Focus on key target clients
Current major project activity:
• 6 jackups under construction
• 1 more jackup to start in May
• 8 rig refurbishment projects
• 1 onshore construction project
www.lamprell.com 12
Improved operational performance and business development
Order book (bn)
As at 31 December 2014
$1.2 (2013: $0.9)
Our order book ($m)
As at 31 December 2014
Bid pipeline remains strong
www.lamprell.com 13
Extensive pipeline, diversified across regions and
products
Clear evidence of market softening affecting bidding
and awards
Potential project delays
Continued major business development drive across
core markets:
• Greater emphasis on strategic approach to bidding
• Strict targeting strategy
• exceptional conversion rate in 2014
$1.4 (2013: $0.9)
$5.2 (2013: $4.7)
New awards in 2014 (bn)
Bid pipeline (bn)
As at 31 December 2014
Extensive pipeline of $5.2bn at 31 December 2014
Challenging market environment
www.lamprell.com 14
Oil price slide impacted capex budgets globally
The full impact remains unclear:
• Intensifying competition
• Impact of new jackup supply unknown
• Expected pressure on pricing
• NOCs relatively resilient
Shallow water drilling expected to be less affected:
• 84% utilisation in global jackup fleet (Dec 2014)
• Slow-down in offshore construction globally
• Opportunities remain in Middle East
Underlying fundamentals remain strong, driven by
growing energy demand
Long-term fundamentals remain strong
Focus on maintaining a competitive position
Ageing current global jackup fleet
Approximately 30% of the global jackup fleet
will be over 35 years old by 2017. This is
expected to reflect positively on the demand
for new build jackup rigs and rig refurbishment
projects.
<35 years old
>= 35 years old
Well positioned to weather the storm
Ahead of the game to stay competitive:
Project Evolution conceived last year, with
implementation progressing well
Early rewards from cost savings programme before
the onset of low oil prices
Streamlined organisational structure delivering
reduction in overheads
Geographical location as competitive advantage
Significant flexibility to adjust to new realities:
Full runrate of savings from Evolution in 2016
Further savings to be realised from overhead
reductions
Adaptability through flexible workforce structure
www.lamprell.com 15
Culture of continuous improvement
Rig refurbishment: EDC Rig 49
Summary and Outlook
Strong 2014 profitability driven by construction phasing (with nine completions), improved project execution and cost savings
New marketing strategy delivered major awards
Good level of revenue coverage for 2015
Extensive pipeline with a large number of bids outstanding despite the challenging markets
Balance sheet strength following the Rights Issue
Further cost savings through overhead reductions and project Evolution
Earlier revised guidance maintained
www.lamprell.com 16
Strong performance and extensive bid pipeline
Well prepared for challenging times NDC Al Shuwehat
Appendices
www.lamprell.com
Fred.Olsen Windcarrier
11
14 12
7 5
7 6
2 2 1
5 4
5 7
4 2 2
3
0
3
0
0
1
1
0
0
0
0 1
0
0 2 0
3
1
0 0
1
0
0
TRIFR Target FY 2013 0.65
TRIFR Target FY 2014 0.55
0.93 0.96 0.93
0.89
0.81 0.75 0.74
0.67 0.63
0.55
0.48 0.44 0.42
0.39 0.35 0.33 0.32 0.31
0.27 0.28
0.04 0.04 0.03 0.04 0.04 0.04 0.02 0.02 0.02 0.02 0.02 0.03
0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.06
Inci
den
t Fr
equ
ency
Rat
es
Tota
l Nu
mb
er o
f D
AFW
C &
Rec
ord
able
Inci
den
ts
DAFWC TRC TRIR Target TRIR Actual DAFWCF Actual
Strong platform for future performance Continuous improvement in safety record
World class safety performance
www.lamprell.com 18
Driving forward with our Strategy
www.lamprell.com 19
Path to long-term sustainable growth
Integrity
State of the Art Facilities Cost Efficiencies Productivity
Continuous
Improvement Balance Sheet
Risk Management
Systems & Procedures Safety Quality
New Build
Jackups
Client Relationship
GROWTH
REVENUES PROFITS
DIVIDENDS
Offshore
Topsides
Onshore
Modules Land
Rigs
Rig
Refurb
Fiscal Responsibility
Teamwork
On Time Delivery
FPSOs LNG
Modules Renewables
RESULTS
FABRICATION
BUSINESS
STREAMS
FOUNDATIONS
Operational efficiency and cost reduction
www.lamprell.com 20
Capital investment includes
New welding processes
Automated equipment and enhanced
processes
Reconfigure yard layout and
throughput
Enhanced capability
Asset management
Upgrade of facility infrastructure
Phase 2 ERP system, including roll-
out of fully integrated work packs
Estimated 3-4 year payback period
Significant savings delivered through
Optimising facility and equipment
utilization
Improved yard flows
Synergies across projects
Productivity improvements
Reduced material handling
Lower utility costs
Phase 2 ERP system
FY 2014 FY 20131
$m $m
Revenue* 1,084.9 1,072.8
Gross profit* 182.1 120.0
Gross margin % 16.8% 11.2%
Operating profit * 109.1 58.7
Finance costs - net** (18.4) (22)
Share of profit of equity accounted investments 3.0 1.1
Profit before income tax 93.7 37.8
Income tax expense (0.5) (1.1)
Profit from continuing operations 93.2 36.7
Profit / (loss) from discontinued operations (6.4) (0.2)
Gain on disposal of subsidiary (Inspec) 31.3 -
Total profit attributable to equity holders 118.1 36.4
Financial summary
www.lamprell.com 21
Significant improvement in profitability
* Relating to continuing operations
** Represents the net balance of finance costs and finance income including exceptional finance costs 1Financial results for the year 2013 have been re-presented due to IFRS 5 (discontinued operations) and further details are provided in the notes to the
Financial Statements.
Revenue split by business segment
www.lamprell.com 22
Revenue dominated by jackups but strategy in place to diversify
Slow year for offshore construction
Land Rigs a growing contributor
New build oil & gas
New build renewables
Refurbishment
Offshore construction
Other
$1,084 $1,073
As at 31 December 2014 (m) As at 31 December 2013 (m)
Current project summary
www.lamprell.com 23
Project Type 2014 1H 2015 2H 2015 1H 2016 2H 2016 1H 2017
NDC 6 Le Tourneau S116E
NDC 7 Le Tourneau S116E
NDC 8 Le Tourneau S116E
Jindal 2 Le Tourneau S116E
Greatship 2 Le Tourneau S116E
Petrofac UZ750 Process modules
Ensco 1 Le Tourneau S116E
Ensco 2 Le Tourneau S116E
Shelf 1 Le Tourneau S116E
Shelf 2 Le Tourneau S116E
Related Documents
