Click to edit Master text styles Second level OTTO MARINE LIMITED Building upon strong fundamentals Third level Fourth level Fifth l l Fifth level OTTO MARINE LIMITED Disclaimer This presentation and the associated slides contain confidential information about Otto Marine Limited (the “Company”) and its subsidiaries and associates (together with the Company, the “Group”). By accepting such information, the recipient agrees to keep permanently confidential all information contained herein and that it will use such information only for the purpose it has disclosed to the Company for participating in this presentation and not for other purposes and will not divulge any such information to any other party without the express consent of the Company. Any reproduction of such information, in whole or in part, is prohibited without the permission of the Company. This presentation includes only summary information and does not purport to be comprehensive. The information contained in this presentation has not been subject to independent verification. No promise, guarantee, representation, warranty or undertaking, express or implied is made as to and no reliance should be placed on the fairness accuracy reliability completeness or correctness of the information implied, is made as to, and no reliance should be placed on, the fairness, accuracy, reliability, completeness or correctness of the information or opinions contained herein. Neither the Company, any other company within the Group or its advisors, nor any of their directors, officers or employees or any representatives of such persons, shall have any responsibility or liability whatsoever (in negligence or otherwise) for any loss arising from any use of the information or any other information or material discussed. This presentation contains forward-looking statements relating to the business, financial performance and results of the Company. These statements are based on current beliefs, expectations or assumptions and are subject to unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those described in such statements. These risks, uncertainties and other factors include, but are not limited to, economic conditions globally, the impact of competition, political and economic developments in countries in which the Group operates and regulatory developments in those countries and internationally, foreign exchange rates, oil and gas prices and the completion of ongoing transactions. Many of these factors are beyond the Company's ability to control or predict. Although the Company believes that its expectations and the information in this presentation were based upon reasonable assumptions at the time when they were made, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in this presentation. Nothing in this presentation constitutes and shall not in any circumstances be construed as an invitation or an offer to purchase or the solicitation of an offer to purchase any securities issued by the Company or any advice or recommendation with respect to such securities and no part of this presentation shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. 2 OTTO MARINE LIMITED Agenda • Overview of Otto Marine • Overview of Otto Marine • Investment Merits • Business Segments • Financial Highlights • Industry Outlook Growth Strategies 3 • Industry Outlook, Growth Strategies Click to edit Master text styles Second level 1 Overview of Otto Marine Third level Fourth level Fifth l l 1. Overview of Otto Marine Fifth level 4
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Click to edit Master text stylesSecond level
OTTO MARINE LIMITEDBuilding upon strong fundamentals
Third levelFourth level
Fifth l lFifth level
OTTO MARINE LIMITEDDisclaimer
This presentation and the associated slides contain confidential information about Otto Marine Limited (the “Company”) and its subsidiariesand associates (together with the Company, the “Group”).
By accepting such information, the recipient agrees to keep permanently confidential all information contained herein and that it will use suchinformation only for the purpose it has disclosed to the Company for participating in this presentation and not for other purposes and will notdivulge any such information to any other party without the express consent of the Company. Any reproduction of such information, in wholeor in part, is prohibited without the permission of the Company.
This presentation includes only summary information and does not purport to be comprehensive. The information contained in thispresentation has not been subject to independent verification. No promise, guarantee, representation, warranty or undertaking, express orimplied is made as to and no reliance should be placed on the fairness accuracy reliability completeness or correctness of the informationimplied, is made as to, and no reliance should be placed on, the fairness, accuracy, reliability, completeness or correctness of the informationor opinions contained herein. Neither the Company, any other company within the Group or its advisors, nor any of their directors, officers oremployees or any representatives of such persons, shall have any responsibility or liability whatsoever (in negligence or otherwise) for anyloss arising from any use of the information or any other information or material discussed.
This presentation contains forward-looking statements relating to the business, financial performance and results of the Company. Thesestatements are based on current beliefs, expectations or assumptions and are subject to unknown risks and uncertainties that could cause, p p jactual results, performance or events to differ materially from those described in such statements. These risks, uncertainties and other factorsinclude, but are not limited to, economic conditions globally, the impact of competition, political and economic developments in countries inwhich the Group operates and regulatory developments in those countries and internationally, foreign exchange rates, oil and gas prices andthe completion of ongoing transactions. Many of these factors are beyond the Company's ability to control or predict. Although the Companybelieves that its expectations and the information in this presentation were based upon reasonable assumptions at the time when they weremade, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in this presentation.
Nothing in this presentation constitutes and shall not in any circumstances be construed as an invitation or an offer to purchase or thesolicitation of an offer to purchase any securities issued by the Company or any advice or recommendation with respect to such securitiesand no part of this presentation shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
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OTTO MARINE LIMITEDAgenda
• Overview of Otto Marine• Overview of Otto Marine
• Investment Merits
• Business Segments
• Financial Highlights
• Industry Outlook Growth Strategies
3
• Industry Outlook, Growth Strategies
Click to edit Master text stylesSecond level1 Overview of Otto Marine
Third levelFourth level
Fifth l l
1. Overview of Otto Marine
Fifth level
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OTTO MARINE LIMITEDOverview
• Offshore Marine Group – engaged in Shipbuilding / Repair & Conversion, Chartering /Leasing and Specialised Servicesg p
• Headquartered in Singapore – commercial, procurement, and treasury support to ouroverseas operations (Indonesia, China, UAE, etc)
• Shipyard in Batam Indonesia – strong management and engineering team capable of• Shipyard in Batam Indonesia – strong management and engineering team capable ofdelivering complex and deep water offshore vessels
• Strategic direction – provider of specialised offshore vessels and services in nichetechnical segments (i.e. seismic, subsea, offshore construction, etc)g ( , , , )
• Customers – primarily specialised offshore service providers in niche segments, andfleet operators in the oil and gas industry
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OTTO MARINE LIMITEDShare Statistics
Share price (Closing on 8 Nov 2011) S$0.135
Market capitalization S$255 2 millionMarket capitalization S$255.2 million
• Shipbuilding net order book of S$81.3m/US$62.5m (at 30 September 2011)
delivered 40 OSVs in the last 5 years– delivered 40 OSVs in the last 5 years
• Chartering revenue to provide steady cash flow– OSVs chartered on medium to long term basis
• Specialised services– service and vessel provider in strategic niche segments which command highermargin (i.e. seismic, subsea vessels for well intervention, ROV, IMR, etc), seismicbacklog contracts worth US$40.1m as at 30 September 2011
• Customer base
– ABCmaritime, Esnaad, Falcon Energy Group Limited, Mosvold Supply, MarineABCmaritime, Esnaad, Falcon Energy Group Limited, Mosvold Supply, MarineSubsea AS, Norshore Shipping, Robert Knutzen Shipholdings
• Strong engineering and experienced management team
average of more than 30 years experience in offshore vessels building
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– average of more than 30 years experience in offshore vessels building
*(US$1.00 = S$1.3015)
OTTO MARINE LIMITEDInvestment Merits
Customer base includes:
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OTTO MARINE LIMITEDInvestment Merits
F L R R i Th i L K k W h Y Ch Si d
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Front L to R: Reggie Thein (Director), Lee Kok Wah (President & Group CEO), Yaw Chee Siew (Executive Chairman) and Heng Hock Cheng @ Heng Heyok Chiang (Director)
Back L to R: William Alastair Morrison (Director), Craig Foster Pickett (Director) and Ng Chee Keong (Director)
OTTO MARINE LIMITED
3 Business Segments3. Business Segments
OTTO MARINE LIMITEDBusiness Segments
Shipbuilding / Ship Repair and Conversion
Ship Chartering• Two-pronged approach –
Strategic Partnerships and100% d fl t
SpecialisedServices• Service and vessel provider in
• Construction of complex, high-spec & environment friendlyOSVs (e.g. AHTS, PSV,offshore construction vessel)
• Repair / conversion of wide
100% owned fleet• Mainly deployed by customers
in Singapore, Indonesia,Australia, West Africa andother South East Asiacountries
Service and vessel provider instrategic niche segmentswhich command higher marginsuch as seismic and subseavessels
• Seismic operator R fl t G h i lRepair / conversion of wide
range of vessels (e.g. OSVs,ocean-going tug)
• Sophisticated vessels for NorthSea operations that meet theABS or DNV classO 64 h hi d i B
countries• Vessels are on medium to long
term time and bareboatcharters
– Reflect Geophysical *Orient Explorer *Reflect Aries *Pacific Titan
• Subsea vessel provider, with ROV capabilities
• Owns 64 ha shipyard in Batam• Selective outsourcing to
China shipyards• Build-to-order
p– Surf Subsea Inc
* Surf Challenger
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OTTO MARINE LIMITED
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OTTO MARINE LIMITED
Focus on high specifications and higher value vessels
Target European / North Sea market that
Global customer base:
- Norshore ASrequire ABS or
DNV class vessels
- ABCMaritime- Mosvold Supply
AS
Ship designs from renowned
N iSelective
outsourcingNorwegian design houses- Marin Teknikk
AS
outsourcing- Allows focus on
sophisticated vessels in Batam
shipyard
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- Vik-Sandvikshipyard
OTTO MARINE LIMITED
Strategically Located Shipyard
SingaporeHeadquartersHeadquarters Strategic advantage due to Singapore’s position as
a regional marine and offshore industry hub
− Access to marine and offshore support
− Access to expertise
− Close proximity to SEA shipbuilding hub
− Ready supply of qualified Indonesian workers
Batam, IndonesiaOwn and operate PT. Batamec - 64 hectare shipyard in Batam
Major South-East Asian shipbuilding hub
− Access to large pool of workers in Indonesia
− Only 1 hour away from Singapore by ferry
15We are able to access marine expertise in Singapore and utilise
a ready supply of workers in Indonesia
OTTO MARINE LIMITED
Shipbuilding: Complex Offshore Support Vessel
Small to medium AHTS(< 14,000 bhp)
Large AHTS(> 14,000 bhp) Offshore construction vessel
Supply & anchor handling role Supports Jack-Ups & standard depth Semisubmersibles
Drilling Unit for field support and construction duties
Work barge with 300 d ti Platform supply vessel Other vessels300 pax accommodation pp y
To support accommodation i t
Transportation of cargo to ff h il ig d l tf
Utility vessels Work maintenance boats
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requirements offshore oil rigs and platforms Work maintenance boats Others
We have a specialised focus on North Sea class offshore support vessels
OTTO MARINE LIMITED
One of the largest yards in Batam
Land area of 64 hectares
Waterfront of 650 metersWaterfront of 650 meters
1 dry dock
2 slipways (under construction)
Syncrolift
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OTTO MARINE LIMITED
The Syncrolift® : Increasing Efficiency of Yard
• Large lifting system, which raises and lowers vessels in and out of the water for
What is itlowers vessels in and out of the water for dry-docking ashore
What it does
• Allows construction and repair of up to 16* vessels at one time
The
• Waterfront efficiency is multiplied • Much faster than using a drydock or
traditional vessel launchThe Advantage
traditional vessel launch
18*using 10,800 bhp vessels as a benchmark
OTTO MARINE LIMITED
Shipbuilding: Strong Engineering Capabilities
Right mix of personnel and tools needed for sophisticated vessels
Led by highly qualified senior engineers I h d i t I t t i ft D t il d i iIn-house design team
+
Investments in software Detailed engineering
=+ = Team of naval architects
and engineers
3D design software, TRIBON®
Precise virtual model
Key benefits
Minimises errors resulting in a more efficient shipbuilding process
Greater accuracy in shipbuilding
Productivity and cost efficiency
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y y
We utilise our strong engineering capabilities to provide turnkey solutions for our customers
OTTO MARINE LIMITEDCompetitive Market Share
BatamecBatamec Shipyard -Ranked 8th in Asia AHT/AHTS newbuildsnewbuilds
20Source: quoted from DnB NOR initiation report dated 1 February 2010
OTTO MARINE LIMITED
Globally Recognised Sophisticated Yard
•Efficient operational capabilities and technical expertise elevates Otto’sposition as a sophisticated shipbuilder.
• Focus on the demand for offshore vessels for deep water operations which isexpected to improve gradually as the oil majors have increased their spendingexpected to improve gradually as the oil majors have increased their spendingand looking more towards deep-water drilling projects
• Ride on our strength as a premium builder to attract the top OSV operators
• Accelerate growth of chartering business to compliment cyclical nature ofshipbuilding business:
• Expand our presence in the oil and gas market in Australia through Gop p g gMarine.
• Expand into the African market through Global Workboats.
St th i li d i t b l i t k f• Strengthen our specialised services segment by leveraging on our network ofglobal players in the deep water and subsea activities
• Management is evaluating various options on hand to deal with the cancelledvessels
• May either sell these vessels at market value or aim at amalgamating them in theGroup’s fleet to charter them out
• These very sophisticated vessels are sister vessels to ‘Deep Sea 1’ that recentlyattained the coveted maritime class certification from DNV
• Already a number of enquiries for these vessels
• World market for this size AHTS has improved in the past months as evidenced bythe rise in the charter rates in the North Seathe rise in the charter rates in the North Sea