BW Offshore: First quarter results 2024
First quarter results 2024
HIGHLIGHTS
- Q1 EBITDA USD 86 million and operating cashflow of USD 91
million
- Equity ratio 31.1% and USD 682 million in available
liquidity
- Q1 cash dividend USD 0.06 per share equivalent to USD 11
million
- Full-year 2024 EBITDA outlook maintained
- Barossa FPSO project 82% complete
at end-April 2024
- Completed sale of the FPSO Polvo to
BW Energy in early May
- Repurchased USD 36 million of
Senior Unsecured Convertible bond
BW Offshore continues to progress the Barossa
FPSO project, having achieved overall completion of 82% by the end
of April, in line with the project schedule. In Singapore,
integration activities are well underway with 13 out of 16 topside
modules successfully lifted onboard and integrated at the end of
April. Offshore Australia, the turret mooring system components
have been delivered and installed on the Barossa field.
“BW Offshore delivers a quarter with strong
operational performance across our FPSO fleet and good progress on
the BW Opal topside integration in accordance with plan,” said
Marco Beenen, CEO of BW Offshore. “We have further strengthened our
financial position with the sale of shares in BW Energy and the
remaining legacy assets. This provides a strong foundation for an
attractive and stable quarterly cash dividend and selectively
progressing growth opportunities that meet our selection criteria
in a strong FPSO market.”
The shares of BW Offshore will trade ex-dividend
from 28 May 2024. Shareholders recorded in VPS following the close
of trading on Oslo Børs on 29 May 2024 will be entitled to the
distribution payable on or about 5 June 2024.
FINANCIALSEBITDA for the first
quarter of 2024 was USD 85.5 million (USD 91.1 million in Q4). The
EBITDA reflects solid operational performance across the FPSO fleet
and USD 8.6 million net contribution mostly related to early works
as part of securing new contracts. Fourth quarter EBITDA was
positively impacted by the conclusion of the Petróleo Nautipa
contract.
EBIT for the first quarter was USD 40.9 million
(USD 44.3 million). A reversal of impairment of USD 1.1 million in
the quarter relates to the sale of Petróleo Nautipa, which was
classified as held for sale on 31 March 2024.
Net financial items were positive by USD 0.8
million (expense USD 19.4 million) of which net interest expense
amounted to USD 8.7 million (USD 9.0 million). Other financial
items were positive, mainly due to settlement of swap contracts in
the quarter.
Share of loss from equity accounted investments
was USD 2.2 million (profit of USD 17.5 million Q4) and relates to
BW Offshore’s ownership in BW Energy. In January 2024, the Group
sold all of its shares in BW Energy Limited at a price of NOK 32
per share, resulting in total proceeds to BW Offshore of NOK 1 860
million or USD 176.4 million. Due to currency fluctuations, a loss
related to the sale was recognised in the first quarter of
2024.
Net profit for the first quarter was USD 36.8
million (USD 40.0 million).
Total equity on 31 March 2024 was USD
1 218.4 million (USD 1 195.3 million). The equity ratio was
31.1% at the end of the quarter (30.2%). Net interest-bearing debt
was USD 28.2 million (USD 172.2 million).
Available liquidity was USD 681.1 million,
excluding consolidated cash from BW Ideol and including USD 267.8
million available under the corporate loan facility.
FPSO OPERATIONSThe FPSO fleet
continued to deliver stable uptime in the quarter with a weighted
average fleet uptime of 100.0% (97.3% in Q4 2023).
In April, BW Offshore signed an agreement to
recycle the FPSO Petróleo Nautipa in compliance with the Hong Kong
International Convention at Baijnath Melaram ship recycling
facility (the "Facility") in India. The sale will free up
approximately USD 9 million of liquidity to the Company.
In May, BW Offshore received the remaining USD
20 million plus interest for the sale of FPSO Polvo to BW Energy,
thereby completing the transaction.
OFFSHORE FLOATING WINDBW
Offshore is engaged in the energy transition by developing clean
energy production solutions, applying its offshore engineering and
operations capabilities to drive future value creation through its
ownership in BW Ideol. BW Ideol is a global leader in offshore
floating wind technology and co-development with more than 12 years
of experience from design, execution and development of floating
wind projects based on proprietary and patented Damping Pool®
technology and engineering capabilities.
In April, BW Ideol introduced a standardised
floating foundation for mass production based on the Damping Pool®
patent. The design is optimised for all metocean conditions found
in the main floating wind markets and compatible with all 15 MW+
wind turbines currently available and easily scalable for 20+ MW
units. The approach centres on a flexible manufacturing line
capable of delivering one floating foundation per week. It is
designed for scalability and replication, with minimal harbour
requirements, to facilitate adaptation and growth in key
markets.
OUTLOOK BW Offshore expects
that the fleet will continue to generate significant cash flows in
the time ahead. Based on the contract backlog, BW Offshore
maintains the guidance of reporting an EBITDA in the range USD
290-310 million for 2024.
Growing energy demand, underinvestment in
production capacity and geopolitical conflicts continue to support
high oil and gas prices and drive interest for developing new
infrastructure-type FPSO projects. These projects typically have
long production profiles, low break-even costs and focus on lower
emissions. Increased project complexity, combined with inflationary
pressures and higher construction costs, necessitates financial
structures with significant dayrate prepayments during the
construction period for new lease and operate projects.
Alternatively, oil and gas majors may finance and own FPSOs,
relying on FPSO specialists for the design, construction and
installation scope, combined with operation and maintenance
services.
BW Offshore will continue to selectively
evaluate new projects that meet required return targets, offer a
firm contract with no residual value risk, and provide a
financeable structure with strong national or investment-grade
counterparties.
BW Offshore is also actively applying its
offshore engineering and operational capabilities to drive future
value creation within the energy transition by developing
low-carbon and clean energy production solutions. This includes
exploring new ventures that target significant market opportunities
emerging within gas-to-power, ammonia and carbon capture, as well
as combining FPSO and floating offshore wind capabilities to grow
in new, adjacent areas. BW Offshore maintains a disciplined
approach with selective and diligent allocation of capital.
Please see attached the Q1 Presentation. The earnings
tables are available at:
https://www.bwoffshore.com/ir/
BW Offshore will host a webcast of the financial results 09:00
(CEST) today. The presentation will be given by CEO Marco Beenen
and CFO Ståle Andreassen.
Webcast information:You can follow the
presentation via webcast with supporting slides and a Q&A
module, available on:
BW Offshore Limited - Q1 Presentation Webcast
Please note, that if you follow the webcast via the above URL,
you will experience a 30 second delay compared to the main
conference call. The web page works best in an updated browser -
Chrome is recommended.
For further information, please contact:Ståle
Andreassen, CFO, +47 91 71 86 55
About BW Offshore: BW Offshore engineers
innovative floating production solutions. The Company has a fleet
of 3 FPSOs with potential and ambition to grow. By leveraging four
decades of offshore operations and project execution, the Company
creates tailored offshore energy solutions for evolving markets
world-wide. BW Offshore has around 1,200 employees and is publicly
listed on the Oslo Stock Exchange.
This information is subject to the disclosure requirements
pursuant to section 5-12 of the Norwegian Securities Trading
Act.