BOURBON’s 2013 Net Income Increases

BOURBON, a company which offers a comprehensive range of surface and subsea marine services for offshore oil & gas fields and wind farms, reports a significant improvement in the full year 2013 operational performance.

BOURBON's 2013 Net Income Increases
The Company highlighted that the Net Income Group share is up 174% to €115 million and that increased operating margin and capital gains generated €575.7 million EBITDA, up 41.7% compared to 2012.

“2013 revenues of more than €1.3 billion and a net income Group share of €115.0 million, a complete range of 485 vessels with an average age of 6.2 years and the broad geographical reach of its activities makes BOURBON a leader in the offshore marine services industry,” says Christian Lefèvre, Chief Executive Officer of BOURBON. “2013 was highlighted by the entry into service of 38 new vessels, an increase in the contractualization rate of the fleet and a significant improvement in operational performance.”

MARINE SERVICES

Operating margin increased almost 2 points versus 2012 as the benefits of the focus on operational excellence began to materialize. Combined with increases in the fleet size and only a slight decline in overall utilization rates, this enabled a 15.8% increase in EBITDAR. The reduced utilization rate was partly due to the movement of vessels between regions, offset by improved average daily rates, most notably in the Deepwater and Crewboat segments.

SUBSEA SERVICES

In Subsea, there was continued good performance, cost control and the benefit of new, larger vessels entering the fleet, all combining to result in an increase in operating margin (excluding capital gains) of 3.6 points, continuing the increase in margins seen over the past year to 42%. With the new vessels delivered being part of the Group’s strategy of building standardized vessels in series, cost benefits will continue to be more prevalent. 2013 marked the start of Subsea activity in Asia (3 vessels out of the fleet of 18 ships). Combined with increases in both average daily rates and utilization rates, this resulted in a 28.6% increase EBITDAR compared with 2012. Activity continued to see strength from the growth in number of wellhead installations during the year, with the market expecting an increase in installations by more than 10% over the period 2013-2017. Subsea IMR (inspection, maintenance and repair) demand outlook is further supported by the aging subsea equipment, where there are 5,000 installed wellheads with an average age of over 10 years.

OUTLOOK

The demand for offshore vessels is supported by the high level of spending in the offshore oil & gas sector.

In deepwater offshore, average spending over the next three years is expected to grow by approximately 10% per year but delays of some projects and a decrease in utilization rates of deepwater floating rigs, combined with the expected deliveries of new vessels, could affect prices in this segment. This is expected to have minimal impact on BOURBON whose 19 PSVs under construction will be delivered through 2015.

In the shallow water market, vessel demand growth is driven by the steady spending in the oil & gas sector, notably by activities aimed at maintaining production of existing fields. Demand is driven by the high utilization rates for jack-up drilling rigs and by the renewal of the jack-up fleet BOURBON has 12 Liberty series vessels under construction and combined with the existing fleet, is in a good position for the continued growth in the sector.

The Subsea services market is buoyed by the growing number of subsea wellheads and the development of new deepwater oil fields. 3 of the 5 vessels in the Bourbon Evolution 800 series that will be delivered in 2014 are already contracted.

The majority of deliveries for vessels currently on order are expected in 2014. From now on, new orders for vessels will be executed as opportunities arise and will not impact revenues before 2016.

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March 05, 2014