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- Q4 EBITDA of USD 102.3 million and Q4 operating cashflow of USD 148.1
million
- EBITDA USD of 401.3 million and operating cashflow of USD 510.2 million for
the full year
- Net impairment of USD 86.3 million in Q4
- Equity ratio 33.9% and USD 391.7 million in available liquidity at end of
2021
- Quarterly cash dividend of USD 0.035 per share
- USD 65.7 million in gross proceeds and USD 14.9 million gain from sale of BW
Energy shares in October
- Barossa FPSO project progressing as planned
- Contract extensions signed for Sendje Berge and Abo FPSO
- Divestment of FPSO BW Joko Tole and BW Cidade de SĂŁo Vicente
- BW Ideol secures close to 1GW worth of floating offshore wind acreage in
ScotWind leasing round
During the fourth quarter, BW Offshore continued to progress the Barossa FPSO
project according to plan. All key subcontractors were assigned at year-end and
purchase orders for all major mechanical packages have been issued. This
provides good visibility for available resources and project timeline. By
proactively locking in vendors and equipment packages, the Company has managed
to mitigate cost inflation and maintain schedule despite continued challenges
affecting global supply chains.
âWe maintain full focus on safe and efficient execution of the Barossa project
and delivering stable performance from our operating assets. We are also
progressing strategic initiatives to position for long-term value creation
opportunities offered by the ongoing energy transition,â said Marco Beenen, the
CEO of BW Offshore. âWe are very pleased with BW Ideol securing the rights to a
significant floating offshore wind farm as one of the winners in the ScotWind
licensing round. The award is a validation of the companyâs market-leading
proven floating wind technology and itâs firm plan for local manufacturing of
concrete foundations, enabled by the exclusive development of the Ardersier Port
in Scotland.â
The Board of Directors has declared a cash dividend of USD 0.035 per share.
Shares will trade ex-dividend from and including 8 March 2022. Shareholders
recorded in VPS following the close of trading on Oslo BĂžrs on 9 March 2022 will
be entitled to the distribution payable on or around 17 March 2022.
FINANCIALS
EBITDA for the fourth quarter of 2021 was USD 102.3 million (USD 97.1 million in
Q3 2021). Fourth quarter EBITDA was impacted by a few one-offs, namely USD 7.5
million returned for previous premiums from The Norwegian Shipownersâ Mutual War
Risks Insurance Association (DNK), as well as USD 5 million net positive one
offs due to adjustments of provisions by year end.
EBIT for the fourth quarter was negative USD 50.9 million (positive USD 28.3
million in Q3 2021) after impairment of USD 86.3 million on the FPSO fleet.
Impairment charges were recognised on BW Athena, Espoir Ivoirien, Sendje
Berge, Joko Tole, PetrĂłleo Nautipa and Umuroa. The Company also reversed a
previous impairment of USD 4.2 million related to the sale of Cidade de SĂŁo
Vicente in the fourth quarter. The impairment reflects reduced expectation of
longer term extensions to current contracts for the listed vessels that are
still in operation, as well as limited potential for future redeployment of the
abovementioned FPSOs that are in lay-up.
Share of profit of equity-accounted investees was USD 23.7 million compared to a
loss of USD 3.8 million the third quarter and include BW Offshoreâs share of net
result from the ownership in BW Energy. In October 2021, BW Offshore sold 20
million shares in BW Energy for USD 65.7 million in gross proceeds. This
transaction resulted in a gain of USD 14.9 million.
Tax expense for the quarter included a write down on deferred tax asset of USD
11.8 million relating to the sale of Joko Tole. The Company has further
finalised the assessment of tax losses in Australia that can be utilised as a
result of the Barossa contract, which has resulted in additional USD 9.3 million
of deferred tax asset recognised in Q4.
Total equity on 31 December 2021 was USD 1,021.4 million (USD 1,089.5 million in
Q3 2021). The equity ratio was 33.9% at the end of the quarter (39.0% in Q3
2021).
Available liquidity on 31 December 2021 was USD 391.7 million, excluding
consolidated cash from BW Ideol.
Net interest-bearing debt was USD 653.4 million (USD 807.1 million in Q3 2021).
FPSO OPERATIONS
The FPSO fleet continued to deliver stable uptime in the quarter with an average
commercial uptime for the fleet of 91.3% (91.6% in Q3 2021). Production on FPSO
Espoir Ivoirien was restarted in October after scheduled maintenance during the
quarter, while production from Sendje Berge was shut down to carry out the tank
inspection program for Class renewal.
In November 2021 and January 2022, BW Offshore signed agreements for the
extensions for the lease and operation of FPSO Sendje Berge and Abo FPSO,
respectively. Both contracts have been extended until the end of 2022.
As part of BW Offshoreâs strategy to transition to floating energy
infrastructure investments, an agreement was signed with an Indonesian
consortium for the sale of FPSO Joko Tole for further operations under local
ownership. The sale will free up over USD 50 million of liquidity, comprising
net sale proceeds of USD 42.5 million and the release of USD 9 million of
working capital upon closing. Closing is expected late in the first quarter of
2022. BW Offshore will provide transition services for a period of up to four
months after closing to ensure safe and uninterrupted transfer of operations,
including the local organisation, to the buyer.
In February 2022, BW Cidade de SĂŁo Vicente was sold for environmentally safe
demolition and recycling in compliance with the Hong Kong Convention at Priya
Blue shipyard in India. The vessel was sold for a cash consideration of USD
12.8 million. A third-party has been nominated as representative on site at the
yard to monitor progress, compliance with environmental and safety regulations
as well as proper application of the ship recycling plan.
OFFSHORE FLOATING WIND
BW Offshore is actively pursuing opportunities in the energy transition. The
Companyâs primary investment is in offshore floating wind through the 53.2%
ownership of BW Ideol, a global market leader with more than ten years of
experience from design, execution and development of floating wind projects
based on proprietary and patented Damping PoolÂź technology and engineering
capabilities.
In December 2021, BW Ideol signed an agreement to acquire a 5% ownership in the
30MW EOLMED floating wind pilot project in the French Mediterranean, following
earlier selection of its floater technology and engineering services.
In January 2022, BW Ideol secured the rights to develop a floating offshore wind
farm with an approximate capacity of 1GW off the northeast coast of Scotland
through Crown Estate Scotlandâs ScotWind leasing round, as part of the
partnership Floating Energy Allyance.
Also, in January, BW Ideol agreed to create an investment company for financing
the co-development of offshore wind projects using the patented Damping PoolÂź
technology over the next 5 years with JERA, Japanâs largest utility company, and
ADEME Investissement, a French State-owned company financing innovative
infrastructure projects.
OUTLOOK
The Company expects that core units in the existing fleet will continue to
generate significant cash flow in the time ahead. The firm FPSO contract backlog
at end of 2021 amounted to USD 6.5 billion when including the Barossa contract.
With probable options, the backlog was USD 7.7 billion at the end of the year.
The Covid-19 pandemic continues to affect operations and the market environment.
Higher energy prices in 2021 and into 2022 are a sign of improved market
fundamentals as distribution of vaccines accelerates and more nations normalise
activity levels.
The oil and gas industry is expected to continue to focus on progressing long-
term large field development initiatives with low break-even costs and low
carbon emissions. This expectation is supported by the higher oil and gas
prices. BW Offshore maintains a selective approach to such opportunities,
progressing discussions on only a few high-end projects which can be developed
in partnership with global infrastructure investors.
The Company is seeking to optimise the current asset portfolio considering the
overall cost base. This includes potential divestment or recycling of units if
FPSO redeployment opportunities do not materialise.
BW Ideol is BW Offshoreâs vehicle for investment in floating offshore wind. The
company is progressing multiple projects supported by the funding from the
private placement in 2021.
With the recent divestment of FPSO assets and part of the shareholding in BW
Energy, the Company has further strengthened the balance sheet, and is
positioned for growth into accretive offshore energy projects and long-term
value creation.
Please see attached the Annual Report and Q4 Presentation. The earnings tables
are available at:
www.bwoffshore.com/ir/ (http://www.bwoffshore.com/ir/)
BW Offshore will host a conference call of the financial results 09:00 (CET)
today. The presentation will be given by CEO Marco Beenen and CFO StÄle
Andreassen.
Conference call information:
To dial in to the conference call where the fourth quarter results and Q&A will
be hosted, please dial one of the following numbers:
Norway: +47 2396 3688
UK: +44 3333 009 268
Singapore: +65 6408 5768
France: +33 170 750 737
US: +1 631 913 1422 (PIN: 64647263#)
You can also follow the presentation via webcast with supporting slides,
available on:
BW Offshore Limited (https://streams.eventcdn.net/bwo/q4-2021/)-
(https://streams.eventcdn.net/bwo/q4-2021/)BW Offshore Q4 Presentation
(https://streams.eventcdn.net/bwo/q4-2021/)
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:
StÄle Andreassen, CFO, +65 97 27 86 47
Anders S. Platou, Head of Corporate Finance & Strategy, +47 99 50 47 40
About BW Offshore:
BW Offshore engineers innovative floating production solutions. The Company has
a fleet of 13 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 2,000 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.
Kilde
