otto marine ppt 11 aug 2011(2 of...
TRANSCRIPT
OTTO MARINE LIMITED
3. Business Segments
OTTO MARINE LIMITED
2
Business Segments
Shipbuilding / Ship Repair and Conversion• Construction of complex, high-
spec & environment friendlyOSVs (e.g. AHTS, PSV,offshore construction vessel)
• Repair / conversion of widerange of vessels (e.g. OSVs,ocean-going tug)
• Sophisticated vessels for NorthSea operations that meet theABS or DNV class
• Owns 64 ha shipyard in Batam• Selective outsourcing to
China shipyards• Build-to-order
Ship Chartering• Two-pronged approach –
Strategic Partnerships and100% owned fleet
• Mainly deployed by customersin Singapore, Indonesia,Australia, West Africa andother South East Asiacountries
• Vessels are on medium to longterm time and bareboatcharters
SpecialisedServices• Service and vessel provider in
strategic niche segmentswhich command higher marginsuch as seismic and subseavessels
• Seismic operator – Reflect Geophysical
*Orient Explorer *Reflect Aries *Pacific Titan
• Subsea vessel provider, with ROV capabilities – Surf Subsea Inc
* Surf Challenger
OTTO MARINE LIMITED
3 3
OTTO MARINE LIMITED
4
Focus on high specifications and higher value vessels
Target European / North Sea market that
require ABS or DNV class
vessels
Global customer base:
- Norshore AS- ABCMaritime
- Mosvold Supply AS
Ship designs from renowned
Norwegian design houses- Marin Teknikk
AS - Vik-Sandvik
Selective outsourcing
- Allows focus on sophisticated
vessels in Batamshipyard
OTTO MARINE LIMITED
5
Strategically Located Shipyard
Singapore
Headquarters
� Strategic advantage due to Singapore’s position as a regional marine and offshore industry hub
− Access to marine and offshore support
− Access to expertise
− Close proximity to SEA shipbuilding hub
− Ready supply of qualified Indonesian workers
Batam, IndonesiaOwn and operate PT. Batamec - 64 hectare shipyard in Batam
� Major South-East Asian shipbuilding hub
− Access to large pool of workers in Indonesia
− Only 1 hour away from Singapore by ferry
���������������������� ��������� ��� ��� ������������� � ���
������������������ ������ �������� �
OTTO MARINE LIMITED
6
Shipbuilding: Complex Offshore Support Vessel
��������������� ����������������
� �������� ��������������������� ��������� ��!"# ���� ���������������������������
$������ ���%������������ & ''������������������(�����
� ) ������# ���'���'�������������������������������
* ��!�������+ ���,�����-������������
� �������������������������.��������
/���'�����������(�����
� ���������������'�����������''��������������������'����
& �����(������
� # �����(������� * ��!������������������ & �����
������������� �� ������������������������ �������������� �������
OTTO MARINE LIMITED
7
One of the largest yards in Batam
� Land area of 64 hectares
� Waterfront of 650 meters
� 1 dry dock
� 2 slipways (under construction)
� Syncrolift
OTTO MARINE LIMITED
8
The Syncrolift® : Increasing Efficiency of Yard
What is it
• Large lifting system, which raises and lowers vessels in and out of the water for dry-docking ashore
What it does
• Allows construction and repair of up to 16* vessels at one time
The Advantage
• Waterfront efficiency is multiplied • Much faster than using a drydock or
traditional vessel launch
*using 10,800 bhp vessels as a benchmark
OTTO MARINE LIMITED
9
Shipbuilding: Strong Engineering Capabilities
� ����� ������������� ��������������������� �� ������������
� �������� ��������� � ������ ����� ������
�� �������� �������
!
������������ ������ ��� "��� ������� ���� ��
#
� $��������������� �����
������� �����
� %" ���� ������� ���&�
$��'( �)
� *�� ���� �����������
+�������� ��
� , � � ���������������� ��� ����������� ������ ��� �� ��������
� - ������������� ���� ��� �� ���
� *���� � ������������� ����
����� � ��������������� ���� ������� � � �������� ���
������������ ��� �������������
OTTO MARINE LIMITED
10
Competitive Market Share
Batamec Shipyard -Ranked 8th in Asia AHT/AHTS newbuilds
Source: quoted from DnB NOR initiation report dated 1 February 2010
OTTO MARINE LIMITED
11
Globally Recognised Sophisticated Yard
•Efficient operational capabilities and technical expertise elevates Otto’sposition as a sophisticated shipbuilder.
Source: http://www.standard-club.com/docs/MikeMeade.pdf
OTTO MARINE LIMITED
1212
OTTO MARINE LIMITED
13
Expansion of Chartering Operations (As at 30 June 2011)
�+ ��'������'����������.//0 �( � �����������������1.//0 �� ����� �2
� 34������ ���5������������������������������������������������������������6��./������78 $�&�6��9�����&�3��9.���� �������&�.��4:�&�:��6/��78 $�&��.��%//���������� ��� ��������&�:���&�:�������
� 6�; � ��� ��3/./<3/..5� �����������������������������������������������������������������
.��3=������78 $�&�3��=������78 $�&�.��%//���������� ��� ��������
>�������� ���������������0�1��'�(�������
������� ���������� ��� 1�����6?0 ���� ��� �������2
� 9������ ���5�����������������������������������������������������3��%//���������� ��� ���������5�6��:������78 $�
� 6������� ������ �5� ����������������������������������������������������������
.��=�����&�.��4:�&� 3��94�1
6 7 10
2008 2009 2010 2011E
>�������@A��������������0�1��'�(��������
�������������� ���������� ��� ������� ���&�������������
������� ��� ������������������� B�
10 15 25 31
2008 2009 2010 2011E
OTTO MARINE LIMITED
14
Strategic Partnerships
6?0 :.0
( ������� ����������� ����%
.3 ������� ����������
��������C ���������
������
.//0
( ������������������@A �
D���������
��������� �
( �����������
.E 7'D��� � ���7-
3E 8�������D����� �
%E - �, �� ���7������ �
6E ��������������E
+�������� ��
� ������������������F�������� �������������
���� ���
� ��� �������� � ��� �������� ��� �� ���
�������
� *��� ��&��� ������ C ������ ��� ���
( ���������� ���������� ����������������� �������G� � � �H�� ���� �
& ����2 ���� ���������/������
3 �4������
3�����
OTTO MARINE LIMITED
Investor Relations Contact : Kamal Samuel | Tel: 6438 2990 | Email: [email protected] 1515
OTTO MARINE LIMITED
16
Specialised Services
Offshore Service that provides better margin and enhance our performance
����� ���������������� ���� ��������� �� ������������
� � ��������� ��������� ����������� �� ������������
�������
�E �� �� ��������I �������- ����� ���1=.E=0�� ���2�����������
J�( � ����>��������������������
J��������7� ���
J�*� � �$ ���
��E �������������� ���������������1.?E30�� ���2��������������������
J�����D���������
OTTO MARINE LIMITED
4. Financial Highlights
OTTO MARINE LIMITED
18
Results Summary: 1H2011
Revenue
Gross Profit / Loss
Operational Expenses
PATMI
62% S$155.0m
S$9.4m Loss
S$17.3m
S$31.3m Loss
10%
OTTO MARINE LIMITED
19
Historical PerformanceRevenue
(SGD millions)
PATMI
(SGD millions)
155.0
(31.3)
OTTO MARINE LIMITED
20
Segmental Performance 1H2011 vs. 1H2010
�56����� � 7��� � 7��� 4������8
�� ��� �� ��&��� ������ ����������� � ?6E/ %99E6 1462
�� ��D������ �� .3E6 4E6 9=
���� �� ..E= =E4 %9
- ����� �� %/E3 3%E= 34
����������� ��� 9E9 � E, E
$����������� .::E/ 6/9E% 1932
- ����*�� �<�1���2 1?E62 =?E9 � E, E
- ����*�� �<1���2�, ��� ��102 19E.2 33E.
*�� �<1���2�'�����$�� 1%9E32 63E6 � E, E
� ���*�� �<1���2�1���E���������8 �����2 1%.E%2 6.E3 � E, E
� ���*�� �<1���2��, ��� ��102 13/E32 ./E.
>��� ��������*���������1�- "�����2 1.E992 3E3% � E, E
OTTO MARINE LIMITED
21
Segmental Performance 2Q2011 vs. 2Q2010
�56����� 79 7��� 79 7��� 4������8
�� ��� �� ��&��� ������ ����������� �� 4E: ./?E3 1?%2
�� ��D������ �� 9E/ %E3 ==
���� �� :E= 6E. 6%
- ����� ��� .?E9 .%E3 6?
����������� ��� 3E= � E, E
$����������� 6.E4 .3?E4 19=2
- ����*�� �<�1���2 13:E92 6%E3 � E, E
- ����*�� �<1���2�, ��� ��102 19.E62 %%E%
*�� ��'�����$�� 16/E92 .4E9 � E, E
� ���*�� �<1���2�1���E���������8 �����2 1%=E%2 .9E4 � E, E
� ���*�� �<1���2��, ��� ��102 1?.E=2 .3E?
OTTO MARINE LIMITED
22
Consolidated Balance Sheet
�56����� ,�� ���7��� ,��)���7���
4������������� :7;1� <;=1<
0��"�������������� >=;1< >=:1;
������������ ��>��1: ��;,=1,
4�������������� =�<1� =�<1:
0��"��������������� ��>1� ,;<1;
������������� ���:�1� ���>=1;
0���������3�����/�����������? ) ������� 7�1;7 7�1<;
0���?������@����A �1�; �1��
Note: # Total borrowings less cash and bank balances over equity
OTTO MARINE LIMITED
23
Consolidated CashflowStatement
�56����� � 7��� � 7���
0��������������������������(��� �:;1<� �:,1��
0��������'�����(���������(��� ,1= ���:17�
0��������'����'����������(��� =<1< 7�;1>
0��������������������������.�(����� ��,1�� �,1�
4�������������.�(������������������'�����
��:1< 77=17
B''������'��-������������������������������������'������������'���������������
�717� ���1��
4�������������.�(�������������'����� �,�17 77:1<
OTTO MARINE LIMITED
24
Revenue Breakdown
Revenue (S$’mil)
��������
��������� ���
������
���������������������������������������� ���� ����� ��������������������
���������
�������
�� ���
������
OTTO MARINE LIMITED
25
Gross Profit Breakdown
Gross Profit & Margin
Gross Profit (S$’m) Gross Profit Margin
OTTO MARINE LIMITED
26
Revenue and Gross Profit by Business Segments
Shipbuilding, Ship Repair and Conversion
Revenue decreased 74.4% to S$94.0 million while gross profit decreased from S$71.8
million to gross loss of S$17.1 million:•Due to less progress of work achieved with sales contract for which revenue is recognised based on
the % completion method
•The loss was mainly due to the reversal of profits recognised for the terminated sale contracts for the
two vessels
(SGD’000)
OTTO MARINE LIMITED
27
Revenue increased 50.3% to S$24.2 million and gross profit improved from S$12.2 million
to S$14.6 million in 1H2011:•Due to enlarged fleet size
Revenue and Gross Profit by Business Segments
Ship Chartering
(SGD’000)
OTTO MARINE LIMITED
28
Reflect Geophysical registered revenue of S$30.2 million, up 26.7% but incurred a S$7.4
million gross loss in 1H2011• Due to lower utilisation of seismic vessels
Subsea business contributed S$6.6 million in revenue and S$0.4 million in gross profit in
1H2011
Revenue and Gross Profit by Business Segments
Specialised Services
(SGD’000)
OTTO MARINE LIMITED
29
Net Profit & Profit Margin
Net Profit (att.to shh.) and Net Profit Margin
1H2011 vs. 1H2010 Net Profit & Net Profit Margin
Net Profit decreased from S$41.2 million in 1H2010 to a net loss of S$31.3 million in 1H2011 & Net Profit Margin
decreased from 10.1% to (20.2)% due to:• Decrease in revenue in 1H2011 due to less progress work
achieved with sales contract
• Decreased profitability due to the reversal of profit recognised for the terminated sales contract for two vessels and reduction in gross profit from geophysical segment due to lower utilisation
of seismic vessels
(SGD’000)
OTTO MARINE LIMITED
5. Industry Outlook Growth Strategies
OTTO MARINE LIMITED
31
Industry Outlook
� Soaring oil prices will excite O&G spending which will increase demand for OSV and PSV
8% growth previously, now expected 12% - 15%
Source: Graph A: DnB NOR initiation report dated 1 February 2010Graph B: http://www.dockwise4.com/annual2009/?id=14
CAPEX spending
Graph A Graph B
OTTO MARINE LIMITED
32
Industry Outlook
� Otto Marine will stand to benefit from the recovery in the industry as players move towards deeper water
Source: Graph A: http://www.dockwise4.com/annual2009/?id=14Graph B: http://www.epmag.com/Magazine/2010/5/item58177.php
CAPEX development (includes next to drilling activities, also engineering, geosciences and support services)
Graph A
Graph B
Deepwater CAPEX by region
Potential demand for new builds!
OTTO MARINE LIMITED
33
Growth Strategies
• Focus on the demand for offshore vessels for deep water operations which is
expected to improve gradually as the oil majors have increased their spending
and looking more towards deep-water drilling projects
• Ride on our strength as a premium builder to attract the top OSV operators
• Accelerate growth of chartering business to compliment cyclical nature of
shipbuilding business
• Strengthen our specialised services segment by leveraging on our network of
global players in the deep water and subsea activities
OTTO MARINE LIMITED
34
Tackling Issues
Immediate Concern – 2 cancelled vessels (Hull No. 7048 and Hull No. 7049)
• Management is evaluating various options on hand to deal with the cancelled
vessels
• May either sell these vessels at market value or aim at amalgamating them in the
Group’s fleet to charter them out
• These very sophisticated vessels are sister vessels to ‘Deep Sea 1’ that recently
attained the coveted maritime class certification from DNV
• Already a number of enquiries for these vessels
• World market for this size AHTS has improved in the past months as evidenced by
the rise in the charter rates in the North Sea
OTTO MARINE LIMITED
6. Thank YouQ & A