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BOURBON: Press Release 1st Half 2015 Revenues

PARIS, Aug. 5, 2015 (GLOBE NEWSWIRE) --

BOURBON 1st Half 2015 Revenues

Adjusted 1st Half 2015 revenues increased 13.1% to €759 million at current rates (-1.7% at constant rates), which demonstrates good operational resilience in a very challenging market

  • First Half 2015 adjusted revenues reached a company record of €758.8 million, confirming BOURBON's position as a world leader in the OSV market
  • Aside from the impact of a stronger US dollar on revenues, activity remained robust, despite adverse market conditions, on the back of a:
    • 2.6% increase in the fleet size
    • 3.4 point decrease in the average utilization rate
    • 2.6% decrease in the average daily rate (in US$)
  • Compared with the second semester of 2014, adjusted revenues decreased by 6.8% at constant rates
  • Compared with the preceding quarter, adjusted revenues decreased 2.2%, reflecting the additional impact of average daily rate renegotiations and further stacking of vessels

In € millions, unless otherwise noted Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Operational indicators
Number of vessels (FTE)* 501.2 491.8 +1.9% 500.0 500.6 487.9 +2.6%
Number of vessels (end of period)** 506 501 +5 vessels 501 506 501 +5 vessels
Average utilization rate (%) 77.1% 80.2% -3.1 pts 79.1% 78.1% 81.5% -3.4 pts
Average daily rate (US$/day) 11,558 12,274 -5.8% 12,169 11,885 12,207 -2.6%

(*) FTE: Full Time Equivalent.
(**) Vessels operated by BOURBON (including vessels owned or on bareboat charter).

Adjusted Revenues (a)
Marine Services 299.8 277.5 +8.1% 312.2 612.0 551.8 +10.9%
Deepwater offshore vessels 109.6 98.9 +10.8% 113.8 223.4 194.0 +15.2%
Shallow water offshore vessels 116.1 108.3 +7.2% 123.5 239.6 214.9 +11.5%
Crew boats 74.2 70.3 +5.5% 74.9 149.1 142.9 +4.3%
Subsea Services 70.9 56.2 +26.1% 67.1 138.0 110.9 +24.5%
Other 4.5 4.2 +7.4% 4.3 8.8 8.3 +6.6%
Total adjusted revenues
(change at constant rates)
375.2

337.9

+11.0%
-4.9%
383.6

758.8

670.9

+13.1%
-1.7%
IFRS 11 impact*** (30.1) (15.3) n/s (27.4) (57.5) (28.3) n/s
Group TOTAL 345.1 322.6 +7.0% 356.3 701.3 642.6 +9.1%

(***) Effect of consolidation of jointly controlled companies using the equity method.
(a) See page 2.

Average utilization rate (excl. Crew boats) 79.5% 87.3% -7.8 pts 84.3% 81.9% 88.9% -7 pts
Average daily rate (excl. Crew boats US$/d) 18,640 19,588 -4.8% 19,301 19,012 19,541 -2.7%

"The first half of 2015 was highlighted by a continued slowdown in activity in most regions and negotiations with clients on commercial terms. Throughout this difficult period, BOURBON has demonstrated resilience, evidenced by the revenue progression, thanks to our strategy of operating a safe, modern and efficient fleet", says Christian Lefèvre, Chief Executive Officer of BOURBON. "While the duration of this downturn is uncertain, BOURBON is constantly adapting to the market and is unwavering in its focus on excellence in service execution and reducing its costs. This focus will not only improve the group's resilience in the current cycle but will make it even stronger going forward."

(a) Adjusted data:
The adjusted financial information is presented by Activity and by Segment based on the internal reporting system and shows internal segment information used by the principal operating decision maker to manage and measure the performance of BOURBON (IFRS 8). As of January 1, 2015, the internal reporting (and thus the adjusted financial information) records the performance of operational joint ventures on which the group has joint control using the full integration method. Adjusted comparative figures are restated accordingly.

OPERATIONAL HIGHLIGHTS

MARINE SERVICES

  • The market was especially difficult for larger vessels and traditional propulsion vessels (non DP2) in shallow water
  • To adapt to market conditions and to optimize costs, in the Deepwater and Shallow water segments combined, up to 26 supply vessels were temporarily stacked during the 1st half; many of these were non-strategic vessels (non DP, non-diesel electric); the majority of the vessels stacked were in the Shallow water segment
  • Almost all regions showed a significant decline in activity, the greatest impact being seen in the North Sea, Mediterranean/Middle East/India and Asia, while there was good resiliency in the Americas and West Africa

Deepwater offshore

  • The first half reflects client decisions to postpone or cancel projects in exploration and development with less impact on production projects
  • Demand in the North Sea and Asia declined significantly and activity in West Africa started to decline during the period
  • Average daily rates decreased both sequentially and year on year, with effects coming from newer contracts at lower rates as well as renegotiation of some existing contracts


Shallow water offshore

  • All regions other than the Americas were impacted by the current market conditions
  • Almost 40% of BOURBON's non-strategic vessels have been stacked, while the Bourbon Liberty vessels have been showing relatively better resilience in this market

Crew boats

  • The Crew boats segment has been resisting, due in part to this means of transport being a cost effective option compared to the use of helicopters

SUBSEA SERVICES

  • To adapt to current conditions, BOURBON stacked as many as 5 vessels during the period
  • BOURBON took delivery of the 9th Bourbon Evolution 800 series MPSV on June 30, 2015, with the final vessel in the investment program expected to be delivered in the 2nd half 2015
  • Bourbon ROVs installed on its own vessels provided the necessary reactivity for the spot IMR market which has developed in a difficult market
  • The Subsea geographic operating area had further diversified, with 2 Bourbon Evolution 800 vessels working in the Persian Gulf to the satisfaction of the clients
  • In the renewable energy market, BOURBON completed the installation of a submarine cable in a tidal turbine connection project off the island of Ushant in France

MARINE SERVICES

Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Adjusted Revenues (in € millions) 299.8 277.5 +8.1% 312.2 612.0 551.8 +10.9%
Number of vessels (end of period)* 483 481 +2 vessels 479 483 481 +2 vessels
Average utilization rate 77.4% 80.0% -2.6 pts 79.2% 78.3% 81.2% -2.9 pts

* Vessels operated by BOURBON (including vessels owned or on bareboat charter).

Overall, adjusted revenues increased by over 10%, due partly to a strong worldwide client network, local partnerships, a modern fleet and a favorable foreign exchange rate with the US dollar. This helped to offset the effects of a decline in average daily rates and average utilization rates in all segments versus the 1st half of 2014. The decline in average utilization rates for the 1st half 2015 compared with the same period a year ago was most pronounced in the Shallow water segment, though in both Deepwater and Shallow water almost all regions experienced a decline.

Marine Services: Deepwater offshore vessels

Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Adjusted Revenues (in € millions) 109.6 98.9 +10.8% 113.8 223.4 194.0 +15.2%
Number of vessels (end of period)* 82 74 +8 vessels 79 82 74 +8 vessels
Average utilization rate 84.0% 87.2% -3.2 pts 86.0% 84.9% 87.9% -3 pts
Average daily rate (US$/day) 20,286 23,219 -12.6% 21,942 21,097 23,008 -8.3%

* Vessels operated by BOURBON (including vessels owned or on bareboat charter).

Adjusted revenues increased on the strength of new vessels joining the fleet and the positive foreign currency effects. The decline in overall average daily rates reflects the renegotiation of contracts with clients. The North Sea experienced the most significant decline in average daily rates, where BOURBON has only a small number of vessels. Average utilization rates in Deepwater only declined 3.2 points, largely due to the relatively higher level of contractualization and longer term contracts in this segment and up to 6 vessels were stacked during the period.

Marine Services: Shallow water offshore vessels

Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Adjusted Revenues (in € millions) 116.1 108.3 +7.2% 123.5 239.6 214.9 +11.5%
Number of vessels (end of period)* 138 133 +5 vessels 138 138 133 +5 vessels
Average utilization rate 78.3% 87.8% -9.5 pts 84.5% 81.4% 89.5% -8.1 pts
Average daily rate (in US$/day) 13,507 14,006 -3.6% 13,882 13,732 14,070 -2.4%

* Vessels operated by BOURBON (including vessels owned or on bareboat charter).

The Bourbon Liberty vessels showed resistance during the period, with average utilization rates more than 10 points above the non-strategic vessels in the fleet. Average daily rates saw significant decreases in Asia, with a smaller decrease in West Africa while The Americas region increased compared with the 1st half one year ago on the strength of new contracts. The average daily rate decline was partially countered by a mix effect of stacking non-strategic vessels (non DP, non-diesel electric) which generally have lower daily rates than similar sized strategic vessels.

Marine Services: Crew boat vessels



Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Adjusted Revenues (in € millions) 74.2 70.3 +5.5% 74.9 149.1 142.9 +4.3%
Number of vessels (end of period) 263 274 -11 vessels 262 263 274 -11 vessels
Average utilization rate 75.0% 74.3% +0.7 pts 74.4% 74.7% 75.5% -0.8 pts
Average daily rate (in US$/day) 4,732 5,197 -8.9% 4,934 4,837 5,250 -7.9%

Adjusted revenues increased during the period despite a reduction of 11 vessels compared with the same period last year. The positive effects of the US dollar helped offset the impact of the decline in average daily rates. Average daily rates declined partly due to the reduction in average daily rates of the FSIVs in the fleet, which have higher daily rates than the smaller crew boats. There was good resistance in average utilization rates, primarily due to crew boats providing a cost effective alternative to the use of helicopters.

Subsea Services

Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Adjusted Revenues (in € millions) 70.9 56.2 +26.1% 67.1 138.0 110.9 +24.5%
Number of vessels (end of period)* 22 19 +3 vessels 21 22 19 +3 vessels
Average utilization rate 70.2% 83.9% -13.7 pts 75.9% 73.1% 88.8% -15.7 pts
Average daily rate (in US$/day) 48,847 46,868 +4.2% 50,118 49,718 46,452 +7.0%

* Vessels operated by BOURBON (including vessels owned or on bareboat charter).

Compared with the same period a year ago, revenues in the 1st half of 2015 increased primarily as a result of both an increase in the average daily rate and a favorable foreign exchange rate impact. Average daily rates increased due to the mix effect of new, larger vessels that joined the fleet. The stacking of several vessels had the primary impact on the decline in utilization rates. The Subsea fleet has been repositioned to be present in all of BOURBON's main regions of activity and is equipped and ready with ROVs on board (including the new ROVs delivered this year) in order to meet the specific needs of our clients all over the world.

Other

Quarter Half Year
Q2 2015 Q2 2014
(restated)
Var 2015/
2014
Q1 2015 H1 2015 H1 2014
(restated)
Var 2015/
2014
Adjusted Revenues (in € millions) 4.5 4.2 +7.4% 4.3 8.8 8.3 +6.6%

Using chartered vessels has two advantages for BOURBON: it makes it possible to meet client demands and generate contracts while new vessels are being built and added to the fleet. Using chartered vessels also enables BOURBON to offer vessels that are not part of its regular line of services when needed for global calls for tenders. Volatility of "Other" revenues is largely due to the variation in the number of chartered vessels during the period.

OUTLOOK

The market environment in the oil services industry has been significantly impacted by the effects of the oil price drop and the resulting reduction in capital investments by BOURBON's clients, which have been reported to decrease 15% for the majors and up to 30% for the independents. More recently, several large oil companies have been suggesting even further cuts to come for 2016. These cuts are in addition to significant cost reduction plans already underway.

BOURBON will continue to adapt to conditions and maintain its focus on cost control. Among the measures taken, BOURBON will continue to temporarily stack certain vessels which have no anticipated activity for 3 months. Today, 26 supply vessels are stacked.

It is in this context that BOURBON's strategy to operate a modern, standardized fleet, combined with its strong worldwide client network and local partnerships, contributes to its resiliency as its advantages become an even greater differentiator during difficult market conditions. This strategy has helped BOURBON achieve a high technical availability rate of its vessels with more predictable operating costs, which, combined with the low fuel consumption advantages of its diesel electric motors, delivers significant cost savings to clients to meet their offshore needs.

ADDITIONAL INFORMATION

  • BOURBON's results will continue to be influenced by the €/US$ exchange rate

FINANCIAL CALENDAR

2015 1st Half Results press release September 9, 2015

2015 3rd Quarter Financial Information press release November 4, 2015

APPENDIX

Quarterly adjusted revenue breakdown

In € millions 2015 2014 (restated)
Q2 Q1 Q4 Q3 Q2 Q1
Marine Services 299.8 312.2 314.3 289.8 277.5 274.3
Deepwater offshore vessels 109.6 113.8 111.4 106.3 98.9 95.1
Shallow water offshore vessels 116.1 123.5 127.8 112.9 108.3 106.6
Crewboats 74.2 74.9 75.0 70.6 70.3 72.6
Subsea Services 70.9 67.1 67.6 65.7 56.2 54.6
Other 4.5 4.3 6.6 6.1 4.2 4.1
Total adjusted revenues 375.2 383.6 388.5 361.7 337.9 333.0
IFRS 11 impact* (30.1) (27.4) (25.5) (20.8) (15.3) (13.0)
TOTAL CONSOLIDATED ** 345.1 356.3 363.0 340.8 322.6 320.0

* Effect of consolidation of joint ventures using the equity method.
**Consolidated 2014 figures have been restated according to the implementation of the new accounting standards.

Quarterly average utilization rates for the BOURBON offshore fleet

In % 2015 2014
Q2 Q1 Q4 Q3 Q2 Q1
Marine Services 77.4 79.2 81.7 79.4 80.0 82.4
Deepwater offshore vessels 84.0 86.0 85.8 85.7 87.2 88.6
Shallow water offshore vessels 78.3 84.5 89.1 86.6 87.8 91.2
Crewboats 75.0 74.4 76.7 74.0 74.3 76.6
Subsea Services 70.2 75.9 82.8 81.1 83.9 94.4
"Total fleet excluding Crewboats" 79.5 84.3 87.5 85.8 87.3 90.6
"Total fleet" average utilization rate 77.1 79.1 81.7 79.4 80.2 82.8

Quarterly average daily rates for the BOURBON offshore fleet

In US$/day 2015 2014
Q2 Q1 Q4 Q3 Q2 Q1
Deepwater offshore vessels 20,286 21,942 23,093 23,887 23,219 22,839
Shallow water offshore vessels 13,507 13,882 14,452 14,152 14,006 14,199
Crewboats 4,732 4,934 5,067 5,113 5,197 5,323
Subsea Services 48,847 50,118 48,063 50,992 46,868 45,407
"Total fleet excluding Crewboats" average daily
rate
18,640 19,301 19,871 20,247 19,588 19,497

Quarterly number of vessels (end of period)

In number of vessels* 2015 2014
Q2 Q1 Q4 Q3 Q2 Q1
Marine Services 483 479 483 481 481 479
Deepwater offshore vessels 82 79 79 75 74 73
Shallow water offshore vessels 138 138 139 135 133 130
Crewboats 263 262 265 271 274 276
Subsea Services 22 21 21 19 19 18
FLEET TOTAL 505 500 504 500 500 497

* Vessels operated by BOURBON (including vessels owner or on bareboat charter).

Quarterly deliveries of vessels

In number of vessels 2015 2014
Q2 Q1 Q4 Q3 Q2 Q1
Marine Services 4 0 10 5 8 12
Deepwater offshore vessels 3 0 5 1 1 2
Shallow water offshore vessels 0 0 4 2 3 6
Crewboats 1 0 1 2 4 4
Subsea Services 1 0 2 0 1 2
FLEET TOTAL 5 0 12 5 9 14

Half Year adjusted revenue breakdown

In € millions 2015
H1
2014 (restated)
H2 H1
Marine Services 612.0 604.1 551.8
Deepwater offshore vessels 223.4 217.7 194.0
Shallow water offshore vessels 239.6 240.8 214.9
Crewboats 149.1 145.6 142.9
Subsea Services 138.0 133.3 110.9
Other 8.8 12.7 8.3
Total adjusted revenues 758.8 750.2 670.9
IFRS 11 impact* (57.5) (46.4) (28.3)
TOTAL CONSOLIDATED ** 701.3 703.8 642.6

* Effect of consolidation of joint ventures using the equity method.
** Consolidated 2014 figures have been restated according to the implementation of the new accounting standards.

Half Year average utilization rates for the BOURBON offshore fleet

In % 2015
H1
2014
H2 H1
Marine Services 78.3 80.5 81.2
Deepwater offshore vessels 84.9 85.8 87.9
Shallow water offshore vessels 81.4 87.8 89.5
Crewboats 74.7 75.3 75.5
Subsea Services 73.1 81.7 88.8
"Total fleet excluding Crewboats" 81.9 86.6 88.9
"Total fleet" average utilization rate 78.1 80.5 81.5

Half Year average daily rates for the BOURBON offshore fleet

In US$/day 2015
H1
2014
H2 H1
Deepwater offshore vessels 21,097 23,350 23,008
Shallow water offshore vessels 13,732 14,307 14,070
Crewboats 4,837 5,066 5,250
Subsea Services 49,718 48,622 46,452
"Total fleet excluding Crewboats" average daily rate 19,012 19,938 19,541

Half Year deliveries of vessels

In number of vessels 2015
H1
2014
H2 H1
Marine Services 4 15 20
Deepwater Offshore vessels 3 6 3
Shallow water Offshore 0 6 9
Crewboats 1 3 8
Subsea Services 1 2 3
FLEET TOTAL 5 17 23

Breakdown of BOURBON adjusted revenues by geographical region

In € millions Second quarter First half
Q2 2015 Q2 2014
(restated)
Change H1 2015 H1 2014
(restated)
Change
Africa 212.5 190.8 +11.4% 432.3 385.2 +12.2%
Europe & Mediterranean/Middle East 57.2 55.9 +2.3% 116.3 110.0 +5.7%
Americas 68.9 46.9 +47.0% 133.1 90.6 +46.9%
Asia 36.6 44.4 -17.5% 77.1 85.1 -9.3%

Breakdown of BOURBON adjusted revenues by geographical region

2015 2014 (restated)
In € millions Q2 Q1 Q4 Q3 Q2 Q1
Africa 212.5 219.8 227.2 205.3 190.8 194.4
Europe & Mediterranean/Middle East 57.2 59.1 65.3 60.6 55.9 54.2
Americas 68.9 64.2 49.6 49.1 46.9 43.8
Asia 36.6 40.5 46.4 46.8 44.4 40.7

Other key indicators

Quarterly breakdown

2015 2014
Q2 Q1 Q4 Q3 Q2 Q1
Average €/US$ exchange rate for the quarter (in €) 1.11 1.13 1.25 1.33 1.37 1.37
€/US$ exchange rate at closing (in €) 1.12 1.08 1.21 1.26 1.37 1.38
Average price of Brent for the quarter (in US$/bbl) 62 54 76 102 110 108

Half-yearly breakdown

2015
H1
2014
H2 H1
Average €/US$ exchange rate for the half year (in €) 1.12 1.29 1.37
€/US$ exchange rate at closing (in €) 1.12 1.21 1.37
Average price of Brent for the half year (in US$/bbl) 58 89 109

About BOURBON

Among the market leaders in marine services for offshore oil & gas, BOURBON offers the most demanding oil & gas companies a wide range of marine services, both surface and sub-surface, for offshore oil & gas fields and wind farms. These extensive services rely on a broad range of the latest-generation vessels and the expertise of almost 12,000 skilled employees. Through its 29 operating subsidiaries the group provides local services as close as possible to customers and their operations throughout the world, of the highest standards of service and safety.

BOURBON provides two operating Activities (Marine Services and Subsea Services) and also protects the French coastline for the French Navy.

In 2014, BOURBON'S revenue came to €1,346.4 million and the company operated a fleet of 506 vessels as of June 30, 2015.
Placed by ICB (Industry Classification Benchmark) in the "Oil Services" sector, BOURBON is listed on the Euronext Paris, Compartment A.

Contacts

BOURBON

Investor Relations, analysts, shareholders
James Fraser, CFA
+33 491 133 545
james.fraser@bourbon-online.com

Corporate Communications
Christelle Loisel
+33 491 136 732
christelle.loisel@bourbon-online.com

Media relations agency
Publicis Consultants

Jérôme Goaer
+33 144 824 624
jerome.goaer@consultants.publicis.fr
Véronique Duhoux
+33 144 824 633
veronique.duhoux@consultants.publicis.fr
Vilizara Lazarova
+33 144 824 634
vilizara.lazarova@consultants.publicis.fr

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Source: BOURBON