Q3 2012 - Interim consolidated financial information
BW Offshore's operating revenues for Q3 2012 amounted to USD 235.9 million, an increase of USD 13.4 million compared to USD 222.5 million in Q2 2012.
EBITDA for Q3 2012 amounted to USD 35.1 million, an increase of USD 8.2 million compared to USD 26.9 million in the previous quarter. The increase is mainly a result of the first full quarter of contribution from the FPSOs BW Athena and BW Joko Tole. The negative EBITDA effect of the Papa Terra project for the third quarter amounts to USD 75.0 million.
Depreciation amounted to USD 63.9 million, an increase of USD 10.4 million compared to USD 53.5 million in the second quarter of 2012. The increase in depreciation is attributable to the FPSOs BW Athena and BW Joko Tole which were depreciated for the full quarter.
Operating loss for the quarter amounted to USD 30.0 million compared to a loss of USD 27.0 million in the previous quarter. Operating profit excluding the loss recognised on the Papa Terra project in the quarter was USD 45.0 million.
Net debt amounted to USD 1,662.4 million at 30 September 2012, compared to USD 1,754.6 million at 30 June 2012.
BW Offshore has agreed with its lending banks for the USD 2,400 million credit facility and the Umuroa loan on a waiver to carve out the Q2 2012 loss on Papa Terra of USD 50.0 million, as well as additional Papa Terra-losses of up to USD 75.0 million in the second half of 2012. The waiver applies for the equity ratio covenant, the leverage covenant and the interest cover ratio. The waiver has not changed any other terms and conditions in the facilities.
Net cash inflow from operating activities was USD 50.6 million compared to USD 82.2 million in the previous quarter. Net cash inflow from investing activities was USD 74.8 million compared to cash outflow of USD 63.1 million in the previous quarter. Of this, the gross proceeds received from the sale of the FPSO Ningaloo Vision and the FSO Endeavor amounted to USD 101.1 million. Capital expenditures on vessels amounted to USD 26.5 million, compared to USD 63.1 million in the previous quarter.
OPERATIONS AND PROJECTS
BW Offshore`s fleet consists of 14 FPSOs and one FSO. All experienced stable performance with an average uptime of 99.5% during the third quarter. During Q3 2012, BW Offshore has signed extensions for the FPSOs Berge Helene, Espoir Ivoirien and Petróleo Nautipa. FSO Endeavor has been sold during the quarter.
The EPC conversion project FPSO P-63 (Papa Terra) has left the COSCO Dalian yard in China for its voyage to Brazil with a planned short stop-over in Singapore for refueling. Estimated arrival in Brazil is in February 2013, where the final integration of the remaining six modules will take place in Quip's Rio Grande yard. The FPSO is then expected to be installed on the field and commence operation.
The management of BW Offshore has carried out an updated analysis of the project, and the Board of Directors of BW Offshore has concluded to increase the forecasted cost for completing the project from USD 375.0 million to USD 450.0 million. The third quarter 2012 results will consequently be negatively impacted by USD 75.0 million.
The additional project costs are mainly linked to increased engineering, construction, procurement and commissioning cost and increased yard costs associated with the delayed schedule. All possible efforts are being made by BW Offshore and its Brazilian partner, QUIP, to meet the overall project schedule requirements from Petrobras for a July 2013 start-up.
OUTLOOK
The outlook for the energy market in general and FPSO business in particular remains good. Based on BW Offshore's diversification, presence, scale and competence, the Company's will continue to play a leading role in the FPSO market.
BW Offshore's cash flow from the operating vessels is secure and based on long term contracts with national oil companies and independent oil companies.
The commencement of operation for the FPSOs BW Pioneer, BW Athena, BW Joko Tole, as well as the recent extensions of contracts for Petróleo Nautipa, Berge Helene and Espoir Ivoirien will contribute to significant growth in the EBITDA for 2012 and beyond.
BW Offshore is currently pursuing several prospective projects that meet the Company's financial targets. This includes both further contract extensions for existing units, as well as contracts for new FPSO projects.
The Board has declared a cash dividend of USD 0.01 per share for the quarter.
Please see the attachments for the full quarterly report and presentation.
For further information, please contact:
Knut R. Sæthre, CFO, +47 9111 7876 (Media)
Kristian Flaten, Vice President IR and Corporate Finance, +47 9509 2322 (Investors/analysts)
About BW Offshore:
BW Offshore is a leading global provider of floating production services to the oil and gas industry. BW Offshore is the world's second largest contractor with a fleet of 14 FPSOs and 1 FSO represented in all major oil regions world-wide. BW Offshore has a long track record on project execution and operations, as well as a robust balance sheet and strong financial capabilities. In more than 30 years of production, BW Offshore has executed 36 FPSO and FSO projects. The company is listed on the Oslo Stock Exchange. Further information is also available on www.bwoffshore.com
This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act)