BW Offshore Q4 2008 results

 
The financial results of 2008 have been significantly influenced by several provisions, write-offs and impairment charges. On the operational side, YÙUM K’AK’NÁAB has received full dayrates through the fourth quarter and the ongoing conversions have been progressing in line with expectation. BW Cidade de São Vicente has set sail for Brazilian waters, while BW Pioneer is undergoing conversion at the Keppel yard in Singapore. The production uptime on BW Offshore’s FPSOs was 100% for 2008.

The turmoil in the financial markets and the lower oil price could impact negatively on business in the short term with cancellations or postponements of new field developments. However, we currently see a robust level of bidding activity similar to previous years. In this period of uncertainty, BW Offshore is fully financed at attractive terms and future cash flow is secured by long-term contracts with reputable clients. Beyond this immediate horizon, the Board of Directors of BW Offshore is of the view that the long-term fundamentals of our business remain sound.

BW Offshore’s EBITDA before transactions relating to associates was USD 14.7 million compared to USD 14.1 million in the fourth quarter of 2007. The reported EBITDA was USD -43.2 million (USD 18.8 million) in the fourth quarter.
Share of result of associates was USD -45.4 million (USD 4.7 million) in the fourth quarter and relates to the investments in Prosafe Production and Nexus. At 31 December 2008, BW Offshore owned 23.9% of the shares in PROD and 49.7% of the shares in Nexus.
Loss before tax was USD -273.0 million in the fourth quarter (USD -12.6 million). Income tax expenses amounted to USD 6.0 million in the fourth quarter (USD 4.5 million).

 
At 31 December 2008, BW Offshore held USD 67.7 million in cash and deposits. BW Offshore has significant unused credit facilities.
Over the next 12 months, BW Offshore expects to receive approximately USD 150 million from variation orders and milestone payments.