HAMILTON, Bermuda, Oct. 6, 2023 /PRNewswire/ -- Paratus Energy Services Ltd. ("Paratus" or the "Company") today announced a trading update for the second quarter 2023, and updates on Paratus, its subsidiaries and associated companies ("Paratus Group").
1. Key Financial Highlights
1.1 Paratus
In the second quarter ending June 30, 2023, the Paratus consolidated group generated $54 million in revenue and $28 million in EBITDA[1]. In the first quarter ending March 31, 2023, the Paratus consolidated group generated $43 million in revenue and $12 million in EBITDA[1].
1.2 SeaMex Group
In the second quarter ending June 30, 2023, Paratus' wholly owned subsidiary SeaMex Holdings, Ltd. ("SeaMex") and its subsidiaries (collectively with SeaMex, "SeaMex Group") generated $54 million in revenue and $31 million in EBITDA. Compared to the first quarter 2023, revenue and EBITDA increased by 25.3% and 106.7%, respectively, largely resulting from the resumption of operations of the Courageous and Defender in late Q1 '23 after a period of operational downtime arising as previously reported.
For the second quarter ending June 30, 2023, SeaMex Group earned an average contractual rate of $115 thousand per day and ended with $456 million in contract backlog[2],[3].
As previously announced, SeaMex has received a termination notice from PEMEX regarding the Titania jack-up, with an effective termination date of March 16, 2023. However, Titania has continued to operate uninterrupted under its current contract with PEMEX pursuant to a well completion clause under the contract. SeaMex remains in dialogue with PEMEX regarding a new contract for the Titania and is also actively engaged with third parties regarding other near-term opportunities.
On July 18, 2023, SeaMex fully prepaid the notes outstanding under its Notes Purchase and Private Shelf Agreement dated August 31, 2021 ("SeaMex Notes"), over a year ahead of its maturity. SeaMex emerged from the Bermudian provisional liquidation process in November 2021 with $221 million of SeaMex Notes outstanding. Since August 2022, the SeaMex Notes were gradually prepaid, positioning SeaMex free of any and all third-party debt obligations.
1.3 Joint Venture in Seabras Group
Seabras UK Limited ("Seabras"), a wholly owned subsidiary of Paratus, holds a 50% equity interest in Seabras Sapura Holding GmbH, its associated company, Seabras Sapura Participaҫões S.A and their subsidiaries (collectively with Seabras, "Seabras Group").
During the second quarter period ending June 30, 2023, Seabras Group generated $113 million in revenue and $77 million in EBITDA. Compared to the first quarter 2023, revenue and EBITDA increased by 4.6% and 26.2%, respectively. For the second quarter, Seabras Group earned an average contractual rate of $208 thousand per day and ended with $490 million in contract backlog.
As previously announced, pursuant to an agreed plan amongst the JV shareholders, Seabras Group will distribute all excess cash to its JV shareholders throughout the remainder of 2023. Since June 2023, Paratus received $95.3 million from Seabras Group, and anticipates more receipts in the future.
2. Other Updates
2.1 SeaMex Management Transition
As previously announced, SeaMex has been in the process of moving its outsourced rig management services in-house, under its own brand. As of September 11, 2023, the majority of services, including client management and operational decisions, have been transitioned from Seadrill Management Ltd. to the SeaMex leadership team in Mexico, with the remaining functions and infrastructure expected to continue to be phased-in regularly until it is completely transitioned by Q1 2024.
2.2 Petrobras Tender
In Q2 2023, Petróleo Brasileiro S.A. ("Petrobras") launched its tender process for the procurement of pipelaying supply vessels, which includes 34 batches across five lots with commencement dates ranging from 2024 through 2026. Seabras intends to actively participate in the process, and any successful awards will further bolster its backlog and go forward financial position.
Schedule 1. Key Financial Highlights | ||||
Unaudited Financials | ||||
(US $ in Millions) | Q2 2023 | Q1 2023 | Q2 2022 | Q1 2022 |
SeaMex Group | ||||
Gross Debt(1) |
$46 |
$46 |
$221 |
$221 |
Cash and Restricted Cash(2) | 121 | 52 | 260 | 108 |
Net Debt (3) | (75) | (6) | (39) | 113 |
Revenue | 54 | 43 | 50 | 54 |
EBITDA | 31 | 15 | 26 | 30 |
Contract Backlog(4) | 456 | 500 | 653 | 705 |
Receivables Balance | 102 | 141 | 77 | 261 |
Seabras Group | ||||
Gross Debt(1) |
108 |
111 |
316 |
375 |
Cash and Restricted Cash(2) | 38 | 93 |
117 | 143 |
Net Debt (3) | 70 | 18 | 199 | 232 |
Revenue | 113 | 108 | 108 | 94 |
EBITDA | 77 | 61 | 63 | 43 |
Contract Backlog | 490 | 604 | 939 | 916 |
Paratus Energy Services(5) | ||||
Gross Debt(1) |
761 |
744 |
869 |
861 |
Cash and Restricted Cash | 189 | 55 | 264 | 114 |
Net Debt(3) | 572 | 689 | 605 | 747 |
Notes: | ||||
Schedule 2. Fleet Status Report
SeaMex Group | ||||||
Rig Name | Generation / Type | Built | Location | Client | Start | Expire |
Defender | BE |
2007 | Mexico | PEMEX | Mar-20 | Jan-26 |
Courageous | BE | 2007 | Mexico | PEMEX | Mar-20 | Nov-26 |
Intrepid | BE | 2008 | Mexico | PEMEX | Mar-20 | May-26 |
Oberon | BE | 2013 | Mexico | PEMEX | Mar-20 | Oct-25 |
Titania(1) | BE | 2014 | Mexico | PEMEX | Mar-20 | Q4'23 |
Notes: | ||||||
Seabras Group | ||||||
Vessel Name | Generation / Type | Built | Location | Client | Start | Expire |
Sapura Diamante | PLSV | 2014 | Brazil | Petrobras | Oct-21 | Apr-25 |
Sapura Topazio | PLSV | 2014 | Brazil | Petrobras | Mar-22 | Mar-25 |
Sapura Esmeralda | PLSV | 2016 | Brazil | Petrobras | Apr-16 | Jul-24 |
Sapura Onix | PLSV | 2015 | Brazil | Petrobras | Sep-15 | Oct-23 |
Sapura Onix | PLSV | 2015 | Brazil | Enauta | Jan-24 | Sep-24 |
Sapura Jade | PLSV | 2016 | Brazil | Petrobras | Feb-16 | Apr-24 |
Sapura Rubi | PLSV | 2016 | Brazil | Petrobras | Aug-16 | Sep-24 |
Paratus -- Forward-Looking Statements
This release includes forward-looking statements. Such statements are generally not historical in nature, and specifically include statements about the Company's and / or the Paratus Group's (including any member of the Paratus Group) plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. These statements are based on management's current plans, expectations, assumptions and beliefs concerning future events impacting the Company and / or the Paratus Group and therefore involve a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, which speak only as of the date of this news release. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, management's reliance on third party professional advisors and operational partners and providers, the Company's ability (or inability) to control the operations and governance of certain joint ventures and investment vehicles, oil and energy services and solutions market conditions, subsea services market conditions, and offshore drilling market conditions, the cost and timing of capital projects, the performance of operating assets, delay in payment or disputes with customers, the ability to successfully employ operating assets, procure or have access to financing, ability to comply with loan covenants, liquidity and adequacy of cash flow from operations of its subsidiaries and investments, fluctuations in the international price of oil or alternative energy sources, international financial, commodity or currency market conditions, including, in each case, the impact of COVID-19 and related economic conditions, changes in governmental regulations, including in connection with COVID-19, that affect the Paratus Group, increased competition in any of the industries in which the Paratus Group operates, the impact of global economic conditions and global health threats, including in connection with COVID-19, our ability to maintain relationships with suppliers, customers, joint venture partners, professional advisors, operational partners and providers, employees and other third parties and our ability to maintain adequate financing to support our business plans, factors related to the offshore drilling, subsea services, and oil and energy services and solutions markets, the impact of global economic conditions, our liquidity and the adequacy of cash flows for our obligations, including the ability of the Company's subsidiaries and investment vehicles to pay dividends, political and other uncertainties, the concentration of our revenues in certain geographical jurisdictions, limitations on insurance coverage, our ability to attract and retain skilled personnel on commercially reasonable terms, the level of expected capital expenditures, our expected financing of such capital expenditures, and the timing and cost of completion of capital projects, fluctuations in interest rates or exchange rates and currency devaluations relating to foreign or U.S. monetary policy, tax matters, changes in tax laws, treaties and regulations, tax assessments and liabilities for tax issues, legal and regulatory matters, customs and environmental matters, the potential impacts on our business resulting from climate-change or greenhouse gas legislation or regulations, the impact on our business from climate-change related physical changes or changes in weather patterns, and the occurrence of cybersecurity incidents, attacks or other breaches to our information technology systems, including our rig operating systems. Consequently, no forward-looking statement can be guaranteed.
Neither the Company nor any member of the Paratus Group undertakes any obligation to update any forward-looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, we cannot assess the impact of each such factors on our businesses or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement.
[1] The figures presented for Paratus do not consider revenue and EBTIDA from Seabras Group as Seabras is not consolidated in the Paratus financial statements due to Paratus' 50% equity ownership of Seabras
[2] SeaMex backlog is calculated at the dayrate floor and is subject to market rate adjustments
[3] SeaMex backlog does not take into account Titania's continuation under contract into Q4'23
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