BOURBON Net Income Decreases YOY (France)

BOURBON, a company which offers the most demanding oil and gas companies a comprehensive range of surface and subsea marine services for offshore oil and gas fields and wind farms, has announced first half 2013 results.

Revenues were up 14.1% vs. first half 2012 as a result of increasing daily rates overall and a high average utilization rate.

EBIT increased 44.4% versus first half 2012; EBITDA up 22.2% over the same period, benefiting from an increase in average daily rates, cost reduction efforts and a change in consolidation scope.

Net income (Group share) decreased €2.6 million year on year.

All regions realized increases in revenues compared with the first half 2012, notably in Asia.

Average daily rates increased in all segments year on year.

Utilization rates stable year on year despite high level of classification drydocks in the period.

The final agreement of the sale of 51 vessels for up to US$1.5 billion to ICBC Financial Leasing (“ICBCL”) has been signed and the transfer of the first 9 vessels of this agreement for US$144 million is expected to take place in the very near future.

“In a steady market, BOURBON continues to deliver revenue growth,” says Christian Lefèvre, Chief Executive Officer of BOURBON. “During the first half of 2013, BOURBON maintained satisfactory utilization rates while managing a higher level of classification drydocks and higher pace of vessel deliveries than the same period in 2012. This performance reflects our clients’ trust in the unique service BOURBON provides with its fleet of latest generation vessels under the highest standards of safety.”

“BOURBON has signed the final agreement for the sale of 51 vessels for up to US$1.5 billion with ICBCL after the period closed, allowing the Group to begin the reduction in debt as per the Asset Smart portion of the “Transforming for beyond” action plan. The sale of the first 9 vessels, representing US$144 million has been signed. We expect to complete the execution of the remainder of the US$1.5 billion within 10 months. The Group’s rapid debt reduction in the coming months will be a major asset to build the future beyond 2015.”

BOURBON 2015 Leadership Strategy

As the BOURBON 2015 Leadership Strategy covers the period starting from the beginning of 2011 through to the end of 2015, the Company is now at the halfway point in this timeline

Regarding the average annual revenue growth objective of 17% in 2015, BOURBON had annual revenue growth of 18.6% in 2011, 17.7% in 2012 and 14.1% for the first half of 2013

EBITDA as a percent of revenues (excluding capital gains) continued to increase, reaching almost 34% for the first half of 2013

The above percentage has been positively impacted by the cost reduction efforts

EBITDA/average capital employed excluding installments increased by 1.3 points compared with the first half 2012 to 14.6%

Technical availability rate marginally down from first half 2012 and still at a high level of 93.5%

MARINE SERVICES

Compared with the first half of 2012, Marine Services revenues were up 14.5% to €527.3 million, outpacing the rate of increase in the size of the fleet (approximately 5%) reflecting, among others, the improved average daily rates across all segments. Despite significant classification drydocks and the transit of new additions to the fleet to their respective regions of operation, EBITDA as a percent of revenues (excluding capital gains) continued to increase, notably as a result of a slowing pace of direct cost increases on a per ship per day basis.

Compared with the second half of 2012, business activity continued to grow as evidenced by both revenue growth and growth in EBITDA (excluding capital gains), despite taking into account the seasonal impact from the first quarter in addition to the effects mentioned in the comparison to the first half above. Direct costs declined slightly overall compared with the second half of 2012 as the effects of cost reduction efforts throughout Marine Services despite an increase in the fleet of 13 vessels over this period.

SUBSEA SERVICES

Compared with the first half of 2012, revenues in the first half of 2013 for the Subsea Services Activity were up by 18.2% to €109.0 million, benefiting from reduced unplanned maintenance and new vessels entering the fleet with increases in both average daily rate and utilization rate. Operating margin increased significantly, most notably the EBITDA to revenue ratio climbing above the 40% mark.

Compared with the second half of 2012, increases in average daily rates and utilization rates combined to result in EBITDA as a percent of revenues continuing its increase since the first half of 2012. The 3rd vessel in the Bourbon Evolution series was delivered and has been operating in Malaysia, the client having already indicated a high level of satisfaction with the vessel.

OUTLOOK

Robust investments in Exploration/Production by oil and gas clients continue to stimulate demand for offshore vessels.

In deepwater offshore, the demand for medium size PSVs and large PSVs is expected to increase during the coming months, boosted by development of deepwater projects. This should have a positive impact on the market while absorbing part of the new vessels coming out of the shipyards. The market for AHTS vessels is expected to gradually become more well balanced.

In shallow water offshore, there are 108 jack-up rigs under construction, which should have a positive impact on the demand for modern shallow water offshore vessels. On the supply side, less vessels are expected to be coming out of shipyards, further contributing to an improvement in the market.

Subsea activity is expected to remain high. The Bourbon Evolution 800 series design is well recognized in the subsea IMR market. Interest is foreseen for the capabilities of vessels to support the upcoming growing subsea installation and deepwater field maintenance.

The level of classification drydocks is expected to be slightly lower for the second half of 2013.

The strategy of fleet standardization, the focus on crew training through the use of simulators, and the systematization of maintenance and procurement procedures aim to continue to underpin BOURBON’s operational and financial performance.

BOURBON is fully committed to reducing its debt in order to build future high value-added growth.

“TRANSFORMING FOR BEYOND” ACTION PLAN

In March 2013, BOURBON announced the action plan “Transforming for beyond” to lay the foundations for the Group’s future growth beyond 2015. The financial aspect of this transformation plan consists of selling up to 30% of the supply vessels’ fleet, up to US$2.5 billion, and retain the vessels on bareboat charter for a period of 10 years.

On April 9, 2013, BOURBON announced that the terms of the first phase were signed with the Chinese company ICBC Financial Leasing (“ICBCL”) for 10-year fixed rate (10.66%) bareboat charter of up to 51 supply vessels either in operation (24 on that date) or under construction (27 with delivery expected by June 2014) for a total of up to US$1.5 billion.

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Press Release, August 28, 2013