2. CORPORATE PRESENTATION SEPT 2014 2
- Owns and manages a fleet of 40 Offshore Supply Vessels
- Operating worldwide
- Hemen Holding Limited (35,1%) – Main shareholder
- Market Capitalisation approx. USD 390M
Deep Sea Supply – In brief
Main clients
Top 10 Shareholders
DEEP SEA SUPPLY PLC
SHAREHOLDER % OWNERSHIP
HEMEN HOLDING LIMITED 35,1%
SKAGEN KON-TIKI 6,6%
JP MORGAN CLEARING CORP. 3,3%
UBS AG 2,3%
MORGAN STANLEY & CO 1,8%
DNB NOR MARKETS 1,8%
VPF NORDEA NORGE 1,8%
EUROCLEAR BANK S.A. 1,7%
FIRST GENERATOR 1,6%
KLP ALFA GLOBAL 1,5%
AHTS PSV
3. CORPORATE PRESENTATION SEPT 2014 3
Key events
2005: DESS established – NOK 426M new equity.
- Aquisition of six AHTS vessels
- Listed on Oslo Stock Exchange in Sept. 05
2006: NOK 1.100M raised at NOK 13,60 per share
- Acquisition of 22 newbuild contracts from Seatankers
- Hemen Holding becoming main shareholder
2006 - 2008: Dividend payments equivalent to NOK 11,48 per share
2009 - 2011: Focus on:
- Entering new markets
- Establishing inhouse Ship & Crew management
- Sale of 5 vessels at attractive prices
2010/2011: Ordering 16 PSV newbuilds
2013: Sale of 50% of Brazilian operations to BTG Pactual
- Acquisition of 6 PSV newbuilds
- Strategic
2014: USD 200M private placement.
- Aquisition of 10 newbuild PSVs
2014: Re-introduction of quarterly dividend – 2Q ‘14
Deep Sea Supply – In brief
0,80
0,20
4,62
2,18
2,00
0,68
1,00
0,12
0,00
0,50
1,00
1,50
2,00
2,50
3,00
3,50
4,00
4,50
5,00
2006 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 2Q14
NOK/share
6 8
11 12 14 13 15 15 15 15
0
2
3
8
8 8
8 9
14
25
0
5
10
15
20
25
30
35
40
45
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
No. of vessels
AHTS PSV
Vessel growth
Dividend history
DEEP SEA SUPPLY PLC
4. CORPORATE PRESENTATION SEPT 2014 4
DEEP SEA SUPPLY PLC
Deep Sea Supply – Organisation
Board of Directors
Chairman:
Harald Thorstein
Director:
Frixos Savvides
Director:
Hans Petter Aas
Alternate Director
Kathrine Fredriksen
Key Management Positions
Chief Executive Officer:
Finn Amund Norbye
Chief Financial Officer:
Anders Hall Jomaas
Chartering & Marketing Director:
Tallak Strandenæs
Technical Director:
Jon Are Gummedal
Chartering , Technical and Crew management
Group Accounting services and Insurance
Deep Sea Supply Plc – Holding Company
Chartering , Technical and Crew management
Chartering, Finance, Technical and Projects
5. When building ships
Taking advantage of cycles
Large series / Price / Payment terms
Norwegian design / equipment
Strong supervision teams / Quality
Built in Asia
When operating ships
Lean and mean
Close monitoring of costs
Standardisation – sister vessels
Strive towards excellence in difficult markets
Low and sustainable breakeven rates
Low/medium gearing on new projects
Strong balance sheet
CORPORATE PRESENTATION SEPT 2014 5
Creating Shareholder Value
Dividend payments
Excess cash paid out to shareholders
Long term contracts
Vessels operating worldwide
Opportunistic
Acquisition / sale of vessels
Acquisition / sale of companies
DEEP SEA SUPPLY PLC
6. • Deck area: 1,025 m2
• 4,600 dwt
• Yard: Sinopacific Shipyard
• Average broker value: USD 45.9M
• Deck area: 810 m2
• 4,100 dwt
• Yard: Cochin Shipyard
• Average broker value: USD 35.9M
16 newbuild PSVs
- Norwegian ship design and top specification – for worldwide operations
- All vessels with Clean Design and DP2. Fuel efficient engines and hulls, and diesel electric propulsion
- Individually fitted, delivered vessels with i.a. FiFi-1 and oil recovery
- Reputable yards with solid track records, well known to Deep Sea Supply
- Vessels delivered are very well recognised by charterers
12x Ulstein PX 105 – Large PSV 4x STX 05L - Large PSV
CORPORATE PRESENTATION SEPT 2014 6
DEEP SEA SUPPLY PLC
7. Office PSV AHTS PSV DESS BTG AHTS DESS BTG World Wide operations
CORPORATE PRESENTATION SEPT 2014 7
DEEP SEA SUPPLY PLC
8. Income Statement 1H 2014
(Unaudited figures in USD 1,000)
1H 2014
1H 2013
Operating revenue (100% basis *)
112 348
80 398
Vessel operating expenses (100% basis *)
(49 847)
(39 574)
(Unaudited figures in USD 1,000)
1H 2014
1H 2013
Operating revenue
75 028
76 503
Vessel operating expenses
(32 726)
(37 160)
Other operating expenses
(5 631)
(7 104)
Other gains/(losses)
864
225
Gain on sale
1 302
83 708
EBITDA
38 837
116 172
Depreciation
(16 041)
(7 692)
EBIT
22 795
108 480
Financial income
232
201
Financial expenses
(14 307)
(13 199)
Net currency items
(592)
(4 622)
Change in value of financial derivatives
0
147
Net financial items
(14 667)
(17 473)
Pre-tax result
8 128
91 007
Taxes
(49)
(250)
Profit for the period/year
8 079
90 757
* After sale of 50% of the Brazilian business to BTG Pactual, (and the establishment of DESS BTG), the result from the Brazilian operation has been incorporated 50% line by line in the income statements. The table below presents comparable underlying performance based on 100% of the freight revenue and operating expenses for all vessels:
DEEP SEA SUPPLY PLC
8 CORPORATE PRESENTATION SEPT 2014
9. Key figures
All figures in USD 30.06.2014
Total Assets: 990M
Cash and Cash equivalents: 79M
Borrowings: 449M
Shareholders Equity: 462M 46,7%
Value Adjusted Equity: 564M 53,9%
Solid Balance Sheet
DEEP SEA SUPPLY PLC
CORPORATE PRESENTATION SEPT 2014 9
10. Deep Sea Supply PLC
Holding Company (Cyprus)
DESS PLC
PSVs: 13 vessels
AHTS: 6 vessels
DESS BTG
PSVs: 12 vessels
AHTS: 9 vessels
100% 50%
Operational set-up
DEEP SEA SUPPLY PLC
CORPORATE PRESENTATION SEPT 2014 10
11. Overview
DESS BTG
- 31 May 2013; Sale of 50% of the Brazilian operations to BTG Pactual
– Creating ‘DESS BTG’
- BTG Pactual: One of the largest investment banks in Latin America
– Strong local partner
- DESS BTG acquired 6 Newbuild PSV’s
- Main trading area of DESS BTG is Brazil.
Newbuild PSVs are currently operating outside Brazil
- Management companies in Rio de Janeiro and Macae
DESS BTG
CORPORATE PRESENTATION SEPT 2014 11
12. DESS BTG: Fleet list & charter status as per August 2014
DESS BTG
CORPORATE PRESENTATION SEPT 2014 12
2014 2015
Vessel Type Bhp/Dwt Year Built Trading Area Q2 Q3 Q4 Q1
AHTS Vessels
Sea Tiger KMAR 404 15.000 BHP 1999 Brazil
Sea Panther KMAR 404 15.000 BHP 1999 Brazil
Sea Leopard KMAR 404 15.000 BHP 1998 Brazil
Sea Cheetah Khiam Chuan 15.000 BHP 2007 Brazil
Sea Jaguar Khiam Chuan 15.000 BHP 2007 Brazil
Sea Fox Seatech P-729 6.800 BHP 2011 Brazil
Sea Jackal Seatech P-729 6.800 BHP 2011 Brazil
Sea Vixen Seatech P-729 6.800 BHP 2011 Brazil
Sea Stoat Seatech P-729 6.800 BHP 2011 Brazil
PSVs
Sea Halibut PSV UT 755 L 3.250 DWT 2007 Brazil
Sea Pike PSV UT 755 L 3.250 DWT 2007 Brazil
Sea Bass PSV UT 755 L 3.250 DWT 2008 Brazil
Sea Pollock PSV UT 755 L 3.250 DWT 2008 Brazil
Sea Turbot PSV UT 755 L 3.250 DWT 2008 Brazil
Sea Brasil STX 09CD 4.700 DWT 2012 Brazil
Sea Forth Ulstein PX 105 4.700 DWT 2013 North Sea
Sea Frost Ulstein PX 105 4.700 DWT 2013 Australia
Sea Spark Ulstein PX 105 4.700 DWT 2013 Asia
Sea Spear Ulstein PX 105 4.700 DWT 2014 East Africa
Sea Spider Ulstein PX 105 4.700 DWT 2014 Asia/ Mediterr.
Sea Springer* Ulstein PX 105 4.700 DWT 2014 Asia
Firm Option Spot
* Sea Springer delivered from yard in April 2014
13. DESS PLC
Overview
- Main markets; Asia, Africa and North Europe
- Management companies in Cyprus, Norway and Singapore
- Recent events:
- Purchased 10 newbuilding vessels at total price of USD 366M in June 2014
from a company affiliated with main shareholder
- Financed by a USD 200M private placement
- Bank financing secured for all 10 vessels
CORPORATE PRESENTATION SEPT 2014 13
DEEP SEA SUPPLY PLC
14. CORPORATE PRESENTATION SEPT 2014 14
Modern Fleet with Attractive breakeven
DEEP SEA SUPPLY PLC
6 x Ulstein PX 105 – Large PSV 4 x STX 05L - Large PSV
Cash Margin (Rate / Breakeven): Cash Margin (Rate / Breakeven):
Delivery: 2013 / 2014 Delivery: 2013 / 2014
Purchase price USD 366M vs Broker value USD 419M | Implied discount to market values: USD 53M | Purchase price: USD 40.1M (PX 105) and USD 31.3M (STX – 05L)
15. Deep Sea Supply: Fleet list & charter status as per August 2014
DEEP SEA SUPPLY PLC
CORPORATE PRESENTATION SEPT 2014 15
2014 2015
Vessel Type Bhp/Dwt Year Built Trading Area Q2 Q3 Q4 Q1
AHTS Vessels
Sea Lynx KMAR 404 15.000 BHP 1999 North Sea
Sea Bear KMAR 404 15.000 BHP 1999 Mediterranean
Sea Ocelot Khiam Chuan 10.800 BHP 2007 Asia
Sea Eagle I Khiam Chuan 12.000 BHP 2009 Malaysia
Sea Weasel* Seatech P-729 6.500 BHP 2009 Malaysia
Sea Badger Seatech P-729 6.800 BHP 2011 Asia
PSVs
Sea Trout VS 470MK II 3.250 DWT 2008 North Sea
Sea Angler PSV UT 755 L 3.250 DWT 2007 W.Africa
Sea Witch PSV UT 755 L 3.250 DWT 2008 W.Africa
Sea Falcon Ulstein PX 105 4.700 DWT 2013 North Sea
Sea Flyer Ulstein PX 105 4.700 DWT 2013 North Sea
Sea Tantalus STX 05-L CD 4.100 DWT 2013 North Sea
Sea Titus STX 05-L CD 4.100 DWT 2014 Asia
Sea Tortuga STX 05-L CD 4.100 DWT 2014 E. Africa
Sea Supra** Ulstein PX 105 4.700 DWT 2014 Mediterranean
Sea Surfer** Ulstein PX 105 4.700 DWT 2014 Asia
Sea Swan** Ulstein PX 105 4.700 DWT 2014 Asia
Sea Swift Ulstein PX 105 4.700 DWT 2014 N/A
Sea Triumph STX 05-L CD 4.100 DWT 2014 N/A
Under construction
Under construction
Firm Option Spot
*Sea Weasel owned 25% through Malaysian JV
** Sea Supra, Sea Surfer and Sea Swan delivered from yard in June, July and September 2014’
16. Servicing the offshore oil and gas industry
DEEP SEA SUPPLY PLC
• OSV - Offshore Support Vessels support drilling rigs and fixed installations offshore, consist mainly of AHTS’ and PSVs
• AHTS - Anchor Handling Tug Supply vessels provide anchor handling and towing for offshore rigs
• PSV - Platform Supply Vessels provide cargo and transportation services to and from offshore platforms
• Deep Sea Supply is present in all the major markets
• More deepwater drilling and exploration and an increasing number of offshore installations has led to high demand for OSVs
North Sea, Brazil and Asia Pacific are the largest
regions for high-end offshore support vessels*
*High end OSVs defined as AHTS >15,000 BHP and PSV>3,000 dwt
Source: Pareto Research, IHS, Quest 16 CORPORATE PRESENTATION SEPT 2014
17. Source: ODS Petrodata CORPORATE PRESENTATION SEPT 2014 17
AHTS
Vessel < 20 years: 24,1% of total fleet
Vessel < 30 years: 16,9 % of total fleet
PSV
Vessel < 20 years: 16,8 % of total fleet
Vessel < 30 years: 13,0 % of total fleet
1968
1969
1970
1971972
1973
1974
1975
1976
1977
1978
1979
1980
1981982
1983
1984
1985
1986
1987
1988
1989
1990
1991992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002003
2004
2005
2006
2007
2008
2009
2010
2011
2012013
2014
2015
2016
0
50
100
150
200
250
300
350
No of units
Many deliveries next two years ...
DEEP SEA SUPPLY PLC
18. Deliveries of OSV’s in 2014 vs 2013
1) 1) YTD August 2013 total number of delivered vessels was: 105 (PSV: 72 / AHTS: 33)
Full year 2013 delivery of vessels was: 225 (PSV: 146 /AHTS: 79)
2) YTD May 2014 total number of delivered vessels was: 106 (PSV: 76 / AHTS: 30)
Est. Number of delivered vessels in 2014 based on 2013 ratio: 226 (PSV: 154 / AHTS: 72)
Vessel term utilization
- PSV (>3.000 DWT) currently 87% utilization globally vs 89% in August 2013
- AHTS (>10.000 BHP) currently 80% utilization globally vs 78% in August 2013
Supply vessels Total fleet AHTS PSV
Existing fleet 2961 1625 1336
Orderbook 543 18% 161 10% 382 29%
Average age 12,3 13,0 11,5
Rig market Total fleet Semis/drillships Jackups
Existing fleet 854 325 529
Orderbook 237 28% 96 30% 141 27%
Orderbook in % of fleet, OSV (PSV/AHTS)
and offshore rigs (floaters/JUs)
Source: ODS Petrodata and Swedbank Research CORPORATE PRESENTATION SEPT 2014 18
However, rig deliveries outpace OSV deliveries
DEEP SEA SUPPLY PLC
10 %
15 %
20 %
25 %
30 %
35 %
40 %
Q1 07 Q1 08 Q1 09 Q1 10 Q1 11 Q1 12 Q1 13 Q1 14
OSV Offshore rigs
Delayed deliveries of OSV newbuilds
19. Current OSV activity – Key regions
Europe
Mediterranean
West Africa
East Africa
Australia
SE Asia
Brazil
Mexico
CORPORATE PRESENTATION SEPT 2014 19
DEEP SEA SUPPLY PLC
20.
21. COMPANY ADDRESSES
Cyprus
Deep Sea Supply Plc
John Kennedy Ave., Iris House, 7th Floor,
Office no.740B
Limassol 3100
Cyprus
Deep Sea Supply Management (Cyprus) Ltd
P.O.Box 53340
CY-3302 Limassol
Cyprus
Norway
Deep Sea Supply Management AS
Storgaten 4
N-4876 Grimstad
Norway
Singapore
Deep Sea Supply Management (Singapore) Pte.Ltd.
10 Hoe Chiang Rd
#19-03/04/05 Keppel Tower
Singapore 089315
Brazil
Deep Sea Supply Servicos Maritimos LTDA
Avenida Republica do Chile
230, 22o andar, 20031-170
Centro, Rio de Janeiro
RJ Brazil
presis 360
www.deepseasupply.no
