Seite 1

Geir Sjurseth, Managing Director, Global Head Offshore Finance

DVB Bank SE

Dubai 6 March 2014

OFFSHORE SUPPORT – Prospects in 2014 and beyond

Page 2

Introducing DVB Bank

DVB Overview

• European Company (SE), listed on the Frankfurt Stock Exchange

• 95% owned by DZ Group, the largest co-operative banking group

in Germany

• Over 500 professionals, all specialising in transport finance

• Over 500 clients worldwide, all active in the transport sector

Global Coverage

EUR 1.11bn

Market Capitalisation

$ 29.2bn / EUR 22.2bn

Total Loan Book

EUR 124.9m / 110.4m

Net Profit FY 2012 / FY 2011

20.3%

Basel II Core Capital Ratio

A+

Long Term Debt (Standard & Poor’s)

A-1

Short Term Debt (Standard & Poor’s)

Key Facts

Total Lending Volume: $29.2bn

AMERICA EUROPE ASIA / PACIFIC

New York

Curaçao Singapore

Tokyo

HamburgFrankfurt/MainZurich

Bergen/Oslo

Athens

RotterdamCardiff London

Shipping

42.2%

Land Transport

7.7%

Investment Management

2.7%

Other

4.9%

Aviation

31.1%

Offshore

11.4%

Page 3

DVB’s 4 Global Divisions

OffshoreShipping Aviation Land Transportation

DVB’s Global Divisions takes calculated asset risks in various niches of the transportation industry

• Narrowbody Pax

• Widebody Pax

• Regional jets

• Freighters

• Freight cars

• Locomotives

• Regional passenger train sets

• Passenger coaches

• Road tractors and trailers

• Tank containers

• Crude tankers

• LNG

• Chemical tankers

• Product tankers

• LPG

• Dry bulk

• Container vessels

• Container boxes

• RoRos

• Ferries

• Supply

• Subsea & Construction

• Heavy Lift

• Accommodation

• Seismic

• Drilling

• Floating Production

Page 4

Asset Coverage – Offshore sub segments

OSVs

Hydrocarbon

Exploration

• Seismic Survey Vessel (SSV)

• Electro Magnetic Survey Vessel

Supply & Anchor

Handling

• Anchor Handling Tug (AHT)

• Anchor Handling, Tug & Supply (AHTS)

• Platform Supply Vessel (PSV)

• Stand-by Vessel

• Emergency Response Rescue Vessel (ERRV)

• Multifunction Vessel

Production

• FPSO

• FSO

• FPU

Crew

Accommodation

• Jack-up Platforms

• Semisubmersible Platforms

• Mono-hull Vessels

• Accommodation Barges

Seabed Installation

• Diving Support Vessel (DSV)

• Lay Support Vessel

• ROV Support Vessel

• Multifunction serv

• Construction vsl

• Well Intervention Vessels

• Derrick Barge

• Pipe Carrier

Drilling

• Tender

• Jack-ups

• Semi subs

• Drillships

AccommSeismic Drilling FPSOsSubsea

Page 5

Ability to finance Mexican and

Brazilian flag vessels

S&P and Newbuild Finance

Sale & Leasebacks

Restructuring and

Recapitalizations

Acquisitions and Divestitures

Sale & Leasebacks

(Structuring and Execution)

Structured Equity and

Mezzanine Finance

Equity Public and Private

Placements

Private Equity / Equity Co-

Investments

Product Offering

Financing Advisory and M&A Capital Markets

Acquisition and Mezzanine

Finance

Valuations and Fairness

Opinions

Debt Public and Private

Placements

DVB’s Offshore Division provides a range of financial solutions backed by strong lending capacity

Page 6

Current market snap shot

Offshore companies reporting

strong 2013 financials

Lots of liquidity in the market

Interest rates at their bottom

Bond and equity markets “wide”

open for offshore

Growing interest from PE

China leasing companies doing

deals

Ship yards hungry for business

Risk of too many projects being

funded

Excesses of speculative NBs in

the Jack-Up drilling and large

PSV segments

Oil majors in profit squeeze -

E&P spend down to 4%?

MARKET AT A CROSSROAD?

Page 7

When will the offshore market peak?

Page 8

The oil majors & the contracting companies..

Rig fleet +53%

since 2005

Offshore oil

production from 24

to 22.5mbp over

same time

Page 9

Offshore Rigs Currently On Order / Avg Price

Raw Data Source: RigLogix, 18Oct13

Drillships, 75,

$638mio

Jack-Ups, 107,

$248mio

Semi-Sub, 23,

$670mio

Tender,10,

$147mio

Drillship Jackup Semisub Tender

Page 10

Jack-Up Demand / Supply

Raw Data Source: Rystad EnergyThe Global Drillship Market Forecast

0

100

200

300

400

500

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Rig

Ye

ars

Rig Supply Years Rig Demand Years (275d/y)

Page 11

AHTS Orderbook (31/12/13)

Page 12

PSV Orderbook (31/12/13)

Page 13

Changes in financing patterns?

Ship finance banks

ECAs

Bonds Oslo – public bonds/ NY – public bonds/144A

International/London

Sale & LBs

PE funds

KS financings

SPC financings

IPO/ share issue

$250bn/year v HF/PE of $5-6bn

Page 14

What’s the common denominator?

Page 15

How will PE shape the industry?

Page 16

IPOs?

Stocks on both sides of

the Atlantic trade below

replacement cost. US OSV

stocks all trade below

book value despite

historic premiums, and

Norwegian OSV stocks

trade at an eye-popping

0.47x NAV on average. The

sector trades at earnings

multiples close to historic

lows despite the solid

outlook. (Platou, Feb 2014)

Page 17

Comparable Listed Offshore Supply Companies

Company name CurrencyStock

Price% 52w H % 52w L MV USDm EV USDm

EV / EBITDA

LTM 2014 2015

P /E

LTM 2014 2015

Date: 26 February 2014

Offshore Supply Owners

Europe

Bourbon SA EUR 21.61 99% 124% 2,214 5,359 33.6x 18.0x 10.7x 9.6x 9.4x

Deep Sea Supply NOK 10.35 83% 116% 219 360 5.2x 8.7x 6.7x 7.4x 4.1x

DOF ASA NOK 30.20 89% 129% 556 4,835 NM 5.5x 4.1x 9.8x 7.8x

Eidesvik Offshore NOK 33.80 90% 104% 169 609 6.9x 7.3x 5.5x 6.3x 6.6x

Farstad Shipping NOK 131.00 93% 111% 847 2,171 21.3x 8.4x 6.3x 9.2x 6.9x

Havila Shipping NOK 33.80 89% 140% 169 1,090 NM 3.3x 4.0x 9.5x 7.7x

Rem Offshore NOK 65.75 97% 153% 227 894 9.0x NA NA 12.2x NA

Siem Offshore NOK 9.38 90% 130% 606 1,421 NM 6.5x 6.0x 13.5x 5.9x

Solstad Offshore NOK 113.00 93% 121% 725 2,168 9.3x 4.9x 4.5x 9.5x 7.3x

Americas

Gulfmark Offshore USD 44.99 84% 128% 1,207 1,778 31.8x 9.8x 8.5x 14.2x 7.7x

Hornbeck Offshore USD 40.93 69% 105% 1,487 2,334 15.1x 9.3x 6.9x 9.1x 5.7x

Seacor Holdings USD 87.22 89% 128% 1,802 2,197 NM 17.3x 13.0x 9.5x 7.6x

Tidew ater USD 48.40 77% 106% 2,406 3,945 17.8x 9.6x 7.7x 11.0x 7.5x

Asia

Alam Maritim Resources MYR 1.49 91% 186% 372 541 12.6x 10.6x 9.3x 18.5x 14.5x 13.6x

Bumi Armada Berhad MYR 3.90 96% 105% 3,492 4,453 26.9x 16.0x 14.6x 14.8x 9.5x 8.4x

CH Offshore SGD 0.41 85% 103% 229 159 NM NA NA NM NA NA

Ezra Holdings SGD 1.05 71% 127% 814 2,039 NM 11.9x 9.2x 22.3x 11.3x 9.1x

Global Offshore INR 210.00 100% 465% 84 267 19.9x 10.4x 9.6x 10.4x 9.4x 8.7x

Great Offshore INR 64.30 83% 173% 39 483 22.4x NA NA 4.6x NA NA

Jaya Holdings SGD 0.77 93% 138% 467 444 13.7x 12.1x 10.1x 8.0x 6.3x 5.4x

Perdana Petroleum MYR 1.96 98% 233% 434 592 23.9x 13.4x 13.1x 20.2x 10.1x 9.3x

Sw issco Holdings SGD 0.38 95% 169% 137 211 8.6x NA NA 11.0x NA NA

Sw iber Holdings SGD 0.65 83% 110% 314 1,196 8.9x 6.4x 5.7x 6.9x 8.7x 7.8x

Tanjung Offshore MYR 0.60 81% 231% 67 30 NM NA NA 1.6x NA NA

8.4x

3.5x

7.5x

5.8x

6.0x

6.9x

NA

5.2x

6.8x

6.8x

4.5x

6.5x

6.9x

Page 18

Potential adverse market conditions?

Demand change - period

of lasting economic

recession/deflation, falling

asset values

Oil price shock?

New supply/game changer

– shale oil?

Event

Falling E&P spending by oil

majors/ nationals, leading

to;

Marginal, high cost UDW

fields hit

Exploration in fragile

areas/Arctic hit

A 3-5 years period of

equipment over supply, will

reduce rates and values to

new, lower balances

Impact

Page 19

Shale oil v shale gas

US production, million barrels a day

Note: * Converted from cubic feet to barrels of oil equivalent

Sources: Energy Information Administration; The Economist

Page 20

World Oil Demand

Raw Data Source: IEA / Barclays Cap / DVB Research

mio

bb

ls /

day

83.7

85.1

86.1 86.485.2

86.6

89.089.4

90.2

80

82

84

86

88

90

92

2005 2006 2007 2008 2009 2010 2011 2012 2013

Rig fleet +53%

since 2005

Offshore oil

production from

24 to 22.5mbp

over same time

Page 21

Potential World Oil Demand Components in 2020

Raw Data Source: Rystad Energy, DVB Research

90

10

25

11 97

Mio Bbls/day

60

65

70

75

80

85

90

95

100

Current Production

Depletion by 2020

New Conventional

Onshore

New Shale New Oil Sands

New Offshore 2020 Oil demand

69

Page 22

How to conclude?

The Offshore owners/markets are

enjoying very good conditions, but:

Market at a crossroad – downside risk

next 18-24 months

Time for consolidation, reduction in

capex, increased employment cover

Page 23

But then there’s the..

P R E D I C T I O N This will be a year of great energy and power

for those who can grab hold and hang on. You won’t get left in the dust if you’ve

planted a lot of seeds in the previous Snake year. The 2014 Horse will want room to run so have big dreams and goals worthy of a powerful steed and you’ll ride your way to

success.

Page 24

Bergen

DVB Bank SE Nordic Branch

Strandgaten 18

5807 Bergen

NORWAY

New York

DVB Transport (US) LLC

609 5th Avenue, 5th floor

New York, 10017

USA

Singapore

DVB Group Merchant Bank (Asia) Ltd

77 Robinson Road #30-02

068896 Singapore

SINGAPORE

Oslo

DVB Bank SE Nordic Branch

Haakon VII’s gate 1

P.O. Box 1999 Vika, 0125 Oslo

NORWAY

DVB Offshore Division

Thank you for your attention!