Results affected by non-cash impairments
* EBITDA of USD 19.0 million before transaction relating to associates
* Impairment charge of goodwill of USD 167.2 million
* Impairment charge of the investment in Nexus Floating Production Limited of USD 68.8 million
* Conversions in line with expectations
Please find enclosed the full Q3 2008 report and presentation.
BW Offshore reported revenue of USD 114.8 million in Q3 2008 (USD 182.6 million in Q3 2007). Recurring EBITDA and EBIT from core business was USD 19.0 million and USD 7.8 million respectively before impairment charges and results in associated companies. Reported EBITDA was USD -51.4 million (46.0), including an impairment charge of USD 68.8 million related to Nexus Floating Production Limited. The third quarter Income Statement has also been charged with goodwill impairment of USD 167.2 million, and reported EBIT was USD -229.7 million (33.0). Pretax profit was USD -251.4 million.
Net cash flow from operating activities was USD 29.2 million, whereas net cash outflow from investing activities was USD 108.1 million and net cash outflow from financing activities USD 55.0 million. Cash and cash deposits stood at USD 194.5 million at 30 September 2008, and net debt at USD 445.3 million.
BW Offshore capital expenditure programs are fully funded at attractive terms. The Company had per 30 September 2008 drawn USD 642 million of its total USD 1,500 million credit facility.
The current turmoil in the financial markets and lower oil price could possibly impact negatively on our business, mostly on the commercial front with a lower number of new projects, or delays in these projects due to financing challenges. These circumstances may also have an impact on forecasts and assessment of the impairment of financial and non-financial assets. To the extent that information is available, Management has reflected this in their updated impairment assessments.
In this period of uncertainty, the Company 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 BW Offshore is convinced that the long term fundamentals of our business remain sound. Underlying growth in energy demand combined with accelerating depletion of existing fields will fuel increased demand for new oil and gas fields. Investments in new facilities by international and national oil companies will improve market conditions in the medium to long term for the services provided by BW Offshore.
BW Offshore hosts a presentation of the financial results at 09:00 (CET) today at `Shippingklubben` (Haakon VII gt 1, Oslo, Norway). The presentation will be given by CEO Carl K. Arnet and CFO Knut R. Sæthre. The presentation will be broadcasted via webcast, and will also be available for replay. Please visit www.bwoffshore.com for login details.
Bermuda, 13 November 2008
For further information, please contact:
Carl K. Arnet, CEO BW Offshore, +65 9630 3290
Knut R. Sæthre, CFO BW Offshore, +47 9111 7876
BW Offshore is one of the world`s leading FPSO contractors and a market leader within advanced offshore loading and production systems to the oil and gas industry. BW Offshore has more than 25 years` experience and has successfully delivered 13 FPSO projects and 50 turrets and offshore terminals. BW Offshore`s technology division APL has delivered solutions for production vessels, storage vessels and tankers in a wide range of field developments. Adapting through competence, in-house technology, solid project execution and operational excellence, BW Offshore ensures that customer needs are met through versatile solutions for offshore oil and gas projects. BW Offshore has as a global network with offices in Europe, Asia Pacific, West Africa and the Americas. BW Offshore has 1,100 employees and is listed on the Oslo Stock Exchange. For more information, please visit www.bwoffshore.com and www.apl.no