BW Offshore: Third quarter results 2022

Third quarter results 2022

HIGHLIGHTS

• EBITDA of USD 80.4 million
• Operating cashflow USD 191.9 million
• Equity ratio 33.8% and USD 488.6 million in out there liquidity
• Cash dividend of USD 0.035 per share equal to USD 6 million and BW Energy shares as in-kind distribution of USD 5 million
• Barossa FPSO venture progress at 50% per finish of October
• Progressing in direction of contract award for Shell’s Gato do Mato improvement in Brazil
• Six-month contract extension signed for Sendje Berge

BW Offshore continues to progress the Barossa FPSO venture with general completion being at 50% per finish of October. The venture has achieved 6.4 million manhours with out accidents, which displays BW Offshore and the venture companions’ dedication to safeguard folks and operations. The general venture economics stay sound, regardless of the affect of inflation, provide chain challenges and design changes.

Shell Brasil Petróleo Ltda (Shell) and its companions have prolonged the restricted discover to proceed (LNTP) interval with BW Offshore and Saipem S.p.A. This extension is legitimate till 15 February 2023 and is said to the provision of an FPSO for the Gato do Mato oil and gasoline discipline offshore Brazil. Terms of the contract are in agreed type. Upon completion of the extension interval, BW Offshore and Saipem have the choice to be awarded the lease and function contract, contingent on financing and the venture reaching remaining funding determination (FID). If the venture reaches FID and strikes ahead, the FPSO lease and function contract may have a agency interval of 18 years with seven years of choices.

“Gato Do Mato is ready to change into the second main FPSO venture in our portfolio. This is according to our technique of rising the core floating manufacturing enterprise via new offshore vitality infrastructure tasks, assembly our funding necessities via a long-term contract, funding grade counterparties and a gorgeous partnership mannequin,” mentioned Marco Beenen, CEO of BW Offshore.

The Board of Directors has declared a money dividend of USD 0.035 per share and USD 5 million of BW Energy Limited shares as in-kind distribution. Shares will commerce ex-dividend from 22 November 2022. Shareholders recorded in VPS following the shut of buying and selling on Oslo Børs on 23 November 2022 will probably be entitled to the distribution payable on or about 30 November 2022.

FINANCIALS
EBITDA for the third quarter of 2022 was USD 80.4 million (USD 75.6 million in Q2 2022).

EBIT for the third quarter was USD 29.6 million (USD 25.8 million in Q2 2022).

Net monetary gadgets have been adverse by USD 3.9 million (adverse USD 2.6 million in Q2 2022). Low web monetary gadgets are primarily pushed by optimistic mark to market (MTM) adjustments in rate of interest hedges as long-term rates of interest have elevated through the third quarter, offsetting curiosity bills. BW Offshore is nicely hedged towards rising rates of interest underneath all debt services.

Net contribution from BW Offshore’s possession in BW Energy was USD 7.2 million (adverse USD 4.9 million in Q2 2022). BW Energy accomplished one lifting within the quarter at USD 101 per barrel.

Net revenue for third quarter was USD 29.6 million (USD 12.3 million in Q2 2022).

Total fairness at 30 September 2022 was USD 1,095.6 million (USD 1,077.8 million at 30 June 2022). The fairness ratio was 33.8% on the finish of the quarter (35.2% at 30 June 2022).

Net interest-bearing debt was USD 463.2 million (USD 528.3 million at 30 June 2022).

Available liquidity was USD 488.6 million, excluding consolidated money from BW Ideol and together with USD 222 million out there to attract underneath the company mortgage facility.

FPSO OPERATIONS
The FPSO fleet continued to ship steady uptime within the quarter with a weighted common fleet uptime of 99% (95% in Q2 2022).

In July, Pemex assumed the possession and operations of Yùum Ok’ak’ Náab in accordance with the phrases of the 15-year FPSO monetary lease contract.

A brief-term contract extension for Petróleo Nautipa was signed in July forward of demobilisation and decommissioning, which commenced in October.

In November, BW Offshore signed a six-month contract extension for the lease and operation of Sendje Berge. The agency interval has been prolonged to Q2 2023.

OFFSHORE FLOATING WIND
BW Offshore is actively pursuing alternatives within the vitality transition. The Company’s major funding is in offshore floating wind via the 53.2% possession of BW Ideol, a world market chief with greater than ten years of expertise from design, execution and improvement of floating wind tasks based mostly on proprietary and patented Damping Pool® know-how and engineering capabilities.

In September, BW Ideol introduced a cooperation with Taiya Renewable Energy for the joint improvement of floating offshore wind tasks off Taiwan, initially targeted on a 50 MW pilot venture. BW Ideol will design, engineer, construct and set up the floating foundations based mostly on its confirmed Damping Pool know-how. Subject to the venture reaching remaining funding determination, COD (business working date) is focused earlier than the top of 2026, with development anticipated to begin as early as 2025. The settlement additionally covers joint improvement of a number of commercial-scale tasks.

In Scotland, the Floating Energy Allyance (FEA), is continuing with web site investigations and environmental research in preparation for the consent utility course of for the Buchan Offshore Wind venture. During the quarter, the alliance began near-shore testing of the lidar which will probably be put in to gather wind information on the web site of the deliberate 960 MW floating offshore wind farm off the northeast coast of Scotland. FEA is a improvement partnership comprising BayWa r.e., Elicio and BW Ideol.

OUTLOOK
BW Offshore expects the core FPSO fleet to generate vital money circulation within the time forward. The agency contract backlog at finish of September 2022 amounted to USD 6.1 billion, together with the Barossa contract. With possible choices, the backlog was USD 7.3 billion on the finish of the quarter.

The struggle in Ukraine and the Covid-19 pandemic proceed to have an effect on world markets via provide chain disruptions and inflation throughout a variety of commodities. The direct affect on operations from the pandemic has nonetheless began to lower. The greater vitality costs from late 2021 and into 2022 mirror each improved market fundamentals as extra nations normalise exercise ranges within the wake of Covid-19, in addition to issues associated to the safety of vitality because of the struggle in Ukraine.

Oil and gasoline firms have change into extra lively in progressing new discipline improvement tasks in response to greater vitality costs. BW Offshore expects continued give attention to giant discipline improvement initiatives with low break-even prices and low carbon emissions. The firm maintains a selective strategy to such alternatives, progressing discussions on only some high-end tasks which could be developed in partnership with world infrastructure traders. Activity tied to potential re-deployment tasks continues with a selected give attention to BW Opportunity.

BW Ideol is BW Offshore’s automobile for funding in floating offshore wind. The firm is progressing a number of tasks.

BW Offshore seeks to optimise the asset portfolio and general value base. This embrace divestments or recycling of non-core FPSOs according to technique of specializing in infrastructure FPSOs.  

Please see connected the Q3 Presentation. The earnings tables can be found at:

www.bwoffshore.com/ir/

BW Offshore will host a presentation of its monetary results 09:00 (CET) at this time at Hotel Continental in Oslo, Norway. The presentation will probably be given by CEO Marco Beenen and CFO Ståle Andreassen.

You may also observe the presentation by way of webcast with supporting slides, out there on:
BW Offshore Webcast Q3 2022

Please observe that in the event you observe the webcast by way of the above URL, you’ll expertise a 30 second delay in comparison with the principle convention name. The net web page works finest in an up to date browser – Chrome is really helpful.

For additional info, please contact:
Ståle Andreassen, CFO, +47 91 71 86 55
Anders S. Platou, Head of Corporate Finance and Strategy, +47 99 50 47 40

About BW Offshore:
BW Offshore engineers progressive floating manufacturing options. The Company has a fleet of 10 FPSOs with potential and ambition to develop. By leveraging 4 a long time of offshore operations and venture execution, the Company creates tailor-made offshore vitality options for evolving markets world-wide. BW Offshore has round 2,000 staff and is publicly listed on the Oslo inventory alternate.

This info is topic to disclosure necessities pursuant to Section 5-12 of the Norwegian Securities Trading Act.