Paratus Energy Services Ltd.

Earnings Release • Nov 29, 2024

Paratus Reports Q3 2024 Results, Reaffirms Commitment to Shareholder Returns

Paratus Reports Q3 2024 Results, Reaffirms Commitment to Shareholder Returns

Hamilton, Bermuda, November 29, 2024 - Paratus Energy Services Ltd. (ticker

"PLSV") ("Paratus" or the "Company") today reported operational and financial

results for the third quarter of 2024, highlighted by $110 million in revenues

and $63 million in adjusted EBITDA. At quarter-end, the Group held $165 million

in cash deposits and had a net debt balance of $597 million.

Building on the momentum established by the inaugural quarterly cash

distribution to shareholders for the second quarter, Paratus is pleased to

announce that the Board of Directors ("Board") has authorized a cash

distribution to shareholders of $0.22 per share for the third quarter of 2024.

This distribution reflects the continued confidence in the Company's financial

strength and commitment to creating long-term value for shareholders.

"Paratus is delivering on our commitment to return a majority of our excess free

cash in the form of stable distributions to shareholders." said Robert Jensen,

CEO of Paratus. "Including this distribution, we will have returned more than

10% of our current market cap to shareholders since early September. This is a

testament to our strong balance sheet and solid operational performance this

year, and highlights Paratus' differentiated capital returns program."

(Note: numbers below are based on management reporting)

Key highlights

· Revenues of $110 million, including $8 million of variable revenue

previously not recognized in Mexico.

· EBITDA of $63 million on the back of solid operational performance and cost

discipline. EBITDA excluding variable revenue in Mexico was $54 million broadly

in line with the previous quarter ($55 million).

· Reported net loss of $15 million was primarily due to a one-time, non-cash

accounting expense of $35 million related to the partial redemption of the 2026

Notes. Excluding this item, the Company generated net income of $20 million.

· Exited the quarter with Group cash balance of $165 million and $597 million

in net debt.

· Seagems secured $32 million additional backlog for Esmeralda and Fontis

dayrates were adjusted up 4% following contractual market indexation, effective

August.

· In October 2024, Paratus invested $12 million (its pro-rata share) in a

private placement of Archer to support a strategic acquisition transaction.

· In November 2024, Paratus successfully uplisted onto the Euronext Oslo Børs

· In November 2024, the Board of Directors authorized a cash distribution to

shareholders of $0.22 per share for the third quarter of 2024, in line with the

previous quarter.

Fontis

Fontis recorded total revenues of $63 million (Q2 2024: $72 million) including

$8 million (Q2 2024: $15 million) in recognition of variable revenue from

previously unbilled services that were agreed with the customer. Operating

expenses (Opex) were $23 million, which was lower than the previous quarter (Q2

2024: $24 million), and general and administrative expenses (G&A) were $1

million, in line with the previous quarter (Q2 2024: $1 million). Adjusted

EBITDA was $39 million compared to $47 million in Q2 2024 primarily due to a

smaller portion of variable revenue from previously unbilled services compared

to Q2 2024. For informational purposes, EBITDA generated during the quarter

excluding variable revenues, was $31 million, which was largely in line with the

previous quarter (Q2 2024: $32 million), despite the planned downtime of the

Courageous for 58 days during the quarter due to the installation of a new

crane.

In Q3 2024, Fontis achieved an average dayrate of $135.1 thousand per day (Q2

2024: $126.7 thousand per day) and an average technical utilization of 99.0% (Q2

2024: 99.8%), closing the quarter with a contract backlog of $317 million.

At the end of Q3 2024, the notional amount of the accounts receivable was $283

million, up from $215 million in Q2 2024. Fontis collected $106 million of

receivables during the first nine months of 2024, including $90 million in Q2

2024. No payments have been received since the start of the third quarter,

consistent with trends amongst other similar service companies in Mexico,

causing receivables to rise with billed and accrued revenues. Additionally, $29

million was invoiced for previously unbilled services, further increasing the

receivables balance. The Company has noted that the Mexican government has

publicly expressed plans to support Fontis' customer, including direct financial

assistance and a tax reform to help the customer address its financial

obligations and achieve operational efficiencies. The Company, leveraging over a

decade-long relationship, has booked revenues of around $825 million and

collected around $850 million since 2021, demonstrating strong collection

resilience despite short-term fluctuations. The Company is actively engaging

with the client to expedite the collection of outstanding receivables and

expects to recover the full amount, as has been the case in the past, while

acknowledging and planning for the possibility of ongoing fluctuations in the

timing of collections. Consequently, the Company is also actively exploring

alternative opportunities to potentially monetize part of its receivables

balance of $283 million and will update the market accordingly if it enters any

such transactions.

Seagems JV

The Company's 50% share in the JV contributed with $47 million in contract

revenues (Q2 2024: $52 million) and $25 million in adjusted EBITDA (Q2 2024: $28

million). The decrease in revenue was mainly driven by lower average dayrate and

lower average technical utilization. Operating expenses (Opex) were $17 million

and general and administrative expenses (G&A) were $3 million, both largely in

line with the previous quarter (Q2 2024: $17 million and $3 million,

respectively).

The JV achieved an average contractual rate of $185.7 thousand per day (Q2 2024:

$200.8 thousand per day) and an average technical utilization of 97.7% (Q2 2024:

99.3%). The lower average dayrate in Q3 2024 compared to Q2 2024 was mainly due

to Jade and Onix operating under contracts with lower dayrates in the quarter,

compared to spot contracts with higher dayrates in the previous quarter.

As previously announced, pursuant to an agreed plan amongst the JV shareholders,

Seagems distributes all excess cash to its JV shareholders. During Q3 2024, the

JV distributed $22 million to Paratus (Q2 2024: $14 million).

In September, Seagems received the 2024 Petrobras Best Supplier Award as the

best Pipelaying Company. This is the third time in seven editions that the

company receives this award.

(*) Figures reflect period between 2021-Q3 2024. Included in the $850 million

figure is VAT and the nominal value of $196 million unsecured notes issued by

the customer in lieu of cash settlement for an equivalent amount of outstanding

Fontis accounts receivables. During 2022, Fontis sold these notes for $186

million.

Webcast and Q&A Session

Paratus will host a presentation of the Q3 2024 results via an audio webcast

today at 15:00 CET. The presentation will be led by CEO Robert Jensen and CFO

Baton Haxhimehmedi. A Q&A session will follow the presentation, with

instructions on how to submit questions provided at the start of the session.

To join the webcast, please use the following link:

https://channel.royalcast.com/landingpage/paratus-energy/20241129_2/

For further information, please contact:

Robert Jensen, CEO, Robert.Jensen@paratus-energy.com, +47 958 26 729

Baton Haxhimehmedi, CFO, Baton.Haxhimehmedi@paratus-energy.com, +47 406 39 083

This information is subject to the disclosure requirements pursuant to section 5

-12 the Norwegian Securities Trading Act.

Attachments

· Q3 2024 Interim Results Report

· Q3 2024 Interim Results Presentation

An updated company presentation is also available at the Company's website

(www.paratus-energy.com).

About Paratus

Paratus Energy Services Ltd. (ticker: PLSV) is an investment holding company of

a group of leading energy services companies. The Paratus Group is primarily

comprised of its ownership of Fontis and a 50/50 JV interest in Seagems

(formerly Seabras). Fontis is an offshore drilling company with a fleet of five

high-specification jack-up rigs working under contracts in Mexico. Seagems is a

leading subsea services company, with a fleet of six multi-purpose pipe-laying

support vessels under contracts in Brazil. In addition, Paratus is the largest

shareholder in Archer Ltd, a global oil services company, listed on the Euronext

Oslo Børs.

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 pandemics and related economic conditions, changes in

governmental regulations, including in connection with pandemics, 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 pandemics, 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.