Akastor

Investor Presentation • Jul 11, 2024

Quarterly presentation – Akastor ASA 2Q 2024

July 11, 2024

Akastor © 2024

2Q 2024 Highlights

• USD 176 million received in cash in quarter as payment of termination fees and reimbursement of costs and interest
• Accounting gain of NOK 748 million in period, with no outstanding position per end of 2Q
• EBITDA (adj.) of USD 42 million in quarter, up 23% year-onyear driven by higher aftermarket activity and improved revenue mix
• Filed confidential draft registration for potential US IPO

▪ Strong utilization on AKOFS Seafarer and Aker Wayfarer

▪ All three vessels in operation, after completion of reactivation of Skandi Peregrino in the quarter

Financing

• 3,023,886 shares received in period pursuant to warrant agreement
• Net cash position per end of quarter following receipt of DRU proceeds, with no draw on corporate facilities
• Corporate bank RCF facility extended to 2Q 2026

NET CAPITAL EMPLOYED 1)

NOK million, 30 June 2024

Financial update

Ownership agenda

Q&A

Summary and outlook

• HMH announced confidential submission of first draft registration statement for proposed initial public offering
• Revenue of USD 208 million in the quarter, up 10% yearon-year
• EBITDA of USD 42 million in the quarter, up 23% yearon-year
• EBITDA margin of 20% driven by product mix compared to prior quarter
• Orders of USD 179 million, down versus prior year due to a non-repeat of large 2023 product orders and reactivation service orders in prior period

HMH highlights | 2Q 2024

• Revenues up 10% year-on-year and up 7% quarteron-quarter driven by increased aftermarket service volume and increased product shipments
• EBITDA up 23% year-on-year driven by increased aftermarket service volume and improved revenue mix
• Order intake down 19% year-on-year and down 14% quarter-on-quarter driven by non-repeat of large product orders and service reactivations in the prior periods
• Free Cash Flow negative USD 12 million in the quarter, driven by timing of key milestone collections and working capital build for key rig upgrades. USD 40 million cash & cash equivalents at end of 2Q 2024.

Proforma financials, IFRS

ORDER INTAKE USD millions

222

^{207 197 209}

2Q23 3Q23 4Q23 1Q24 2Q24

179

46

EQUIPMENT BACKLOG2) USD millions

2Q23 3Q23 4Q23 1Q24 2Q24

FREE CASH FLOW3) USD millions

Akastor © 2024 Slide 5 1) EBITDA adjusted for non-recurring expenses or costs defined as outside of normal company operations (USD 2 million adjustment in 2Q 24).

2) Equipment backlog defined as order backlog within Projects, Products and Other

Segments highlights

Aftermarket Services

• Service revenue up 9% year-on-year and up 3% quarter-on-quarter driven by spare part output partially offset by lower overhaul and repair volume
• Order intake down 11% year-on-year driven by high rig reactivation service activities prior year and down 5% quarter-on-quarter

Projects, Products & Other

▪ Revenue up 14% year-on-year and up 22% quarter-on-quarter driven by increased product shipments, partially offset by lower project volume

Net interest-bearing debt

• Net debt of USD 173 million as per end of period
• Leverage, NIBD/LTM EBITDA (adj.), at 1.1x per 2Q 2024
• USD 13 million drawn on the RCF in Q2 2024

IBD as per end of period	Amount	Key terms
Senior Secured Bond	200	Nordic Bond raised in 4Q 2023. Maturity November 2026. Fixed rate 9.875%.
Super Senior Secured RCF	13	USD 50m facility, maturity May 2026. Margin 350 – 425 bps.
Gross Interest-Bearing Debt	213
Net shareholder loans 1)	116	Subordinated, 8% PIK interest

Financial update

Ownership agenda

Q&A

Net Capital Employed

Net Capital Employed per 2Q 2024 1) Development in 2Q 2024

NOK million NOK million

Net interest-bearing debt

2Q 2024 highlights

• Net bank debt decreased by NOK 1 613 million in the quarter, to a net cash position of NOK 240 million, driven by DRU proceeds totalling NOK 1.9 billion received in the period
• "Other" (as shown in graph) includes a total payment of NOK 163 million related to the guaranteed preferred return to Mitsui and MOL entered into in connection with AKOFS Offshore divestment in 2018
• DDW Offshore net debt of NOK 261 million per end of quarter

NOK million	2Q 2024
Non-current bank debt	262
Current bank debt	58
Cash and cash equivalents	-560
Net cash	-240
AKOFS receivable	-312
HMH receivable 1)	-225
Other receivables	-54
Net interest-bearing debt (NIBD)	-831

External financing facilities and liquidity

Overview of financing facilities

Facility	Size	Maturity	Margin
Revolving Credit Facility (Akastor corporate)	USD 30 million	June 2026	4.0%
Overdraft facility (Akastor corporate)	NOK 50 million	Uncommitted	4.2%
Share financing facility (Akastor corporate)	NOK 70 million [1]	Uncommitted	1.5%
Term loan (DDW Offshore)	USD 31 million	September 2026	10.85% [2]

• All corporate facilities cleaned down in 2Q, with no draw per end of period
• Revolving Credit Facility amended and extended upon receipt of DRU proceeds in the quarter, with no draw on facility per end of period
  • o Facility provided by DNB and SEB
  • o Facility extended to Q2 2026
  • o Covenants and terms similar to previous facility
• Subordinated Aker facility paid down and cancelled in period

Cash and undrawn facilities as of 30 June 2024

• Revolving Credit Facility remained fully undrawn per end of period
• Cash includes NOK 63 million held through DDW Offshore

Income statement 2Q 2024

NOK million	2Q 2024	2Q 2023	YID 2024	YTD 2023
Revenue	60	63	103	116
Other income	31	1	630	16
Revenue and other income	91	64	733	132
EBITDA	28	-4	601	-21
EBIT	19	-11	586	-35
Net financial items	854	-4	902	83
Profit (loss) from equity-accounted investees	28	-78	8	-173
Profit (loss) before tax	902	-93	1 496	-125
Tax income (expense)	-3	O	-3	O
Profit (loss) from cont. operations	899	-93	1 493	-125
Net profit (loss) from disc. operations	4	105	ব	113
Profit (loss) for the period	903	11	1 496	-12

Revenue and other income (NOK million)	2Q 2024	20 2023	YTD 2024	YID 2023
DDW Offshore	57	52	96	98
Other	34	12	637	35
Reported Group revenue and other income	ਰ 1	64	733	132
EBITDA (NOK million)	2Q 2024	20 2023	YID 2024	YTD 2023
DDW Offshore	15	14	7	27
Other	13	-18	594	-48
Reported Group EBITDA	28	-4	601	-21

COMMENTS

• JV holdings, including HMH and AKOFS, are not consolidated in the Akastor group financials. Consolidated revenue and EBITDA thus only represent a minor part of Akastor's investments.
• Other income of NOK 31 million in 2Q related to final effects following DRU arbitration settlement

Income statement 2Q 2024 (cont.)

NOK million	2Q 2024	20 2023	YID 2024	YTD 2023
Revenue	60	63	103	116
Other income	31	1	630	16
Revenue and other income	91	64	733	132
EBITDA	28	-4	601	-21
EBIT	19	-11	586	-35
Net financial items	854	-4	902	83
Profit (loss) from equity-accounted investees	28	-78	8	-173
Profit (loss) before tax	902	-93	1 496	-125
Tax income (expense)	-3	O	-3	O
Profit (loss) from cont. operations	899	-93	1 493	-125
Net profit (loss) from disc. operations	4	105	4	113
Profit (loss) for the period	903	11	1 496	-12

NOK million	20 2024	2Q 2023	YTD 2024	YTD 2023
Odfjell Drilling	123	-8	128	10
NES Fircroft	52	O	51	22
Other investments	11	-22	-3	-15
Contribution from financial investments	185	-30	176	17
Net interest exp. on borrowings	-14	-31	-47	-57
Net interest charges on leases	O	ব	O	8
Net foreign exchange gain (loss)	-33	50	62	119
Other financial income (expenses)	716	2	710	-5
Net financial items	854	-4	902	83
HMH	77	23	134	-12
AKOFS Offshore	-51	-101	-127	-160
Other	2	-0	0	-0
Profit (loss) from equity-accounted investees	28	-78	8	-173

COMMENTS

• Other financial income include interest compensation related to DRU arbitration of NOK 717 million (cash effect in period)
• Net financial items include noncash items from financial investments and a non-cash net foreign exchange loss of NOK 33 million
• Equity accounted investees contributed positively with NOK 28 million (non-cash for Akastor)

Financial update

Ownership agenda

Q&A

Portfolio overview

Private holdings	Listed investments
Company	Service offering	Ownership
	Global full-service offshore and onshore drilling equipment and service provider	50%
	Global engineering staffing and solution provider for highly technical industries	~15%1)
	Global provider of subsea well construction and intervention services	50%
	Owner of 3 mid-sized AHTS vessels	100%
	Owner and operator of harsh environment drilling units	1.3%
	Energy and marine consultancy company	~5%
	International upstream oil and gas company	~2%
	Independent service provider to offshore wind and other energy sectors	36%
	Drilling contractor	~7%

Business model

• Global full-service offshore and onshore drilling equipment provider with a broad portfolio of products and services
• Large installed base providing firm foundation for strong customer relationship and recurring streams

Quarterly highlights

• EBITDA up 23% year-on-year driven by increased aftermarket service volume and improved revenue mix
• Filed confidential draft registration for a potential US IPO which may occur in the second half of 2024, pending market conditions

Ownership agenda

• Expand the business through organic growth and value-adding acquisitions
• Maintain a leading market position via customercentric R&D, catalyzed by digital technologies
• Targeting to make investment liquid

2Q23 3Q23 4Q23 1Q24 2Q24

Large installed base of 124 offshore drilling rigs2)

Akastor © 2024 Slide 16 1) EBITDA adjusted for non-recurring expenses or costs defined as outside of normal company operations (USD 2 million adjustment in 2Q 24)

2) Including floaters, jack-ups and fixed platforms with either HMH BOP pure stack (annular and ram) or HMH topside package. Figure includes 16 cold stacked units. Reduction of two rig from Q1 2024 (Olinda Star and Ocean Monarch retired in period).

NES Fircroft

Business model

• World's leading engineering staffing and solution provider for highly technical industries spanning a range of staffing services: Contract, Permanent Hire & Managed Solutions
• Diversified range of high growth and strategic endmarkets with a recurring client base within different sectors: Oil & Gas, Power & Renewables, Infrastructure, Life Sciences, Mining, Automotive and Chemicals

Quarterly highlights1)

• Organic EBITDA growth of 15% year-on-year
• Gross margin generated from non oil and gas projects increased by 31% y-o-y (LTM per Q2)
• EBITDA to gross margin conversion increased to 39% in the second quarter, up from 37% in the first quarter
• NIBD to EBITDA of 1.59x, which is 0.7x lower than a year ago

Ownership agenda

• Pursue growth through both organic initiatives and selective M&A
• Optimize value at exit

2Q23 3Q23 4Q23 1Q24 2Q24

engineering workforce management solutions with approx. 90 global offices

Net Interest-Bearing Debt per 2Q 24 of USD 214 million (excl. IDF draw of 114 million)

Akastor © 2024 Slide 17 1) Fiscal year end 31st October. Figures presented on 100% basis. Reported figures representing cont. operations for the Group.

2) Underlying EBITDA comprises earnings before interest, tax, depreciation and amortization and before exceptional items and management recharges. This is considered a better approximation of profit as it is calculated by excluding all non-trading expenditure and non-cash items from operating profit.

AKOFS Offshore

Business model

• Vessel-based subsea well construction and intervention services covering all phases from conceptual development to project execution and offshore operations
• Operates two SESV vessels in Brazil on contract with Petrobras and one LWI vessel in Norway on contract with Equinor

Quarterly highlights

• All vessels in operation through quarter
• Aker Wayfarer delivered a revenue utilization of 99%
• AKOFS Seafarer with technical uptime of 98% and revenue utilization of 94%, affected by mobilization for coiled tubing in May which was completed ahead of schedule
• AKOFS Santos delivered revenue utilization of 72% in period, affected mainly by a planned maintenance stop in May of 13 days

Ownership agenda

• Secure delivery on order backlog
• Explore strategic initiatives

DDW Offshore

Business model

• Owns three Anchor Handling Tug Supply (AHTS) vessels with capability to operate and support clients on a world-wide basis
• The vessels are specially designed to perform anchor-handling, towing, and supply services at offshore oil and gas fields

Quarterly highlights

• Skandi Peregrino completed her 5-year Special Periodic Survey (SPS) in the quarter, and has been operating in the spot market in Aberdeen since mid-May
• Skandi Atlantic commenced a 70-day contract with 110 days of options in Australia for Chevron June 1, 2024, after completing her SPS in May
• Skandi Emerald was on contract with Petrofac for the full quarter

Ownership agenda

• Secure fleet utilization
• Optimize value at exit

Key priorities for Akastor going forward

Akastor © 2024

DISTRIBUTION TO SHAREHOLDERS (CASH OR SHARES) TARGETING TO DISTRIBUTE PROCEEDS FROM FUTURE REALIZATIONS TO SHAREHOLDERS

Slide 20

Akastor © 2024 Slide 21

Financial update

Ownership agenda

Q&A

Appendix

Selected transactions since inception in 2014

Akastor © 2024 Slide 23 1) Pref shares USD 75m + warrants; 2) cash gain; 3) Plus earnout; 4) USD 75m cash + USD 20m seller credit settled in June 2023; 5) Equity value. Proceeds partly in ABL shares, with value based on NOK 15 per ABL share; 6) of which 50% shared with the DDW Offshore lenders; 7) Value of shares received per day of receival;

Consolidated Income Statement

	Second Quarter		Fiscal Year
NOK million	2024	2023	2024	2023
Revenues and other income	01	64	733	132
Operating expenses	-63	-68	-132	-153
EBITDA	28	-4	601	-21
Depreciation, amortization and impairment	-9	-7	-15	-14
Operating profit (loss)	19	-1 T	586	-35
Net financial items	854	-4	902	83
Profit (loss) from equity-accounted investees	28	-78	8	-173
Profit (loss) before tax	902	-03	1 496	-125
Tax income (expense)	-3	O	-3	0
Profit (loss) from continuing operations	899	-93	1 493	-125
Net profit (loss) from discontinued operations	ব	105	ব	113
Profit (loss) for the period	903	ਹੈ ਹ	1 496	-12 :
Attributable to:
Equity holders of Akastor ASA	003	ਹਤ	1 496	-14
Non-controlling interests		-2		3

Consolidated Statement of Financial Position

	June 30	December 31
NOK million	2024	2023
Property, plant and equipment	358	231
Right-of-Use assets	ব	7
Other non-current assets	1	1
Non-current interest bearing receivables	623	550
Equity-accounted investees and other investments	4 799	4 490
Total non-current assets	5 785	5 279
Current operating assets	53	606
Current finance lease receivables	9	ਹੈ ਰੇ
Current interest-bearing receivables	12	O
Cash and cash equivalents	560	144
Total current assets	634	769
Total assets	6 418	6 048
Equity attributable to equity holders of Akastor ASA	5 546	3 970
Total equity	5 546	3 970
Employee benefit obligations	77	82
Non-current liabilities and provisions	183	255
Non-current borrowings	262	236
Non-current lease liabilities	-0	2
Total non-current liabilities	521	575
Current operating liabilities and provisions	233	339
Current borrowings	102	1 133
Current lease liabilities	16	32
Total current liabilities	352	1 504
Total equity and liabilities	6 418	6 048

Consolidated Statement of Cash flows

	Second Quarter		Fiscal Year
NOK million	2024	2023	2024	2023
Profit (loss) for the period	903	ਹੈ ਹ	1 496	-12
(Profit) loss for the period - discontinued operations	-4	-105	-4	-133
Depreciations, amortization and impairment - continuing operations	9	7	15	14
Other adjustments for non-cash items and changes in operating assets and liabilities	961	52	312	ਣ ਹ
Net cash from operating activities	1 869	-34	1 820	-60
Payments for Property, Plant and Equipment	-53	-0	-112	-0
Payments related to sale of subsidiaries incl. adjustment for prior years' divestments	-174	-73	-176	-65
Proceeds from finance lease receivables	5	3	10	18
Cash flow from other investing activities	-23	186	-37	183
Net cash from investing activities	-246	117	-315	135
Net changes in external borrowings	-1 157	14	-1 082	റ്റു
Instalment of lease liabilities	-8	రం	-18	-22
Net cash from financing activities	-1 165	6	-1 100	48
Effect of exchange rate changes on cash and cash equivalents	3	1	10	2
Net increase (decrease) in cash and cash equivalents	461	89	415	125
Cash and cash equivalents at the beginning of the period	ರಿ8	155	144	119
Cash and cash equivalents at the end of the period	560	244	560	244

The statement includes cash flows from discontinued operations prior to the disposal.

Alternative Performance Measures (1 of 2)

Akastor discloses alternative performance measures as a supplement to the consolidated financial statements. Such performance measures are used to provide an enhanced insight into the operating performance, financing abilities and future prospects of the group.

These measures are calculated in a consistent and transparent manner and are intended to provide enhanced comparability of the performance from period to period. It is Akastor's experience that these measures are frequently used by securities analysts, investors and other interested parties.

• EBITDA earnings before interest, tax, depreciation and amortization, corresponding to "Operating profit before depreciation, amortization and impairment" in the consolidated income statement
• EBIT earnings before interest and tax, corresponding to "Operating profit (loss)" in the consolidated income statement
• Net current operating assets (NCOA) a measure of working capital. It is calculated by current operating assets minus current operating liabilities, excluding financial assets or financial liabilities related to hedging activities
• Net capital employed (NCE) a measure of all assets employed in the operation of a business. It is calculated by net current operating assets added by non-current assets and finance lease receivables minus deferred tax liabilities, employee benefit obligations, other non-current liabilities and total lease liabilities
• Gross debt sum of current and non-current borrowings, which do not include lease liabilities
• Net debt gross debt minus cash and cash equivalents
• Net interest-bearing debt (NIBD) net debt minus non-current and current interest bearing receivables
• Equity ratio a measure of investment leverage, calculated as total equity divided by total assets at the reporting date
• Liquidity reserve comprises cash and cash equivalents and undrawn committed credit facilities

Alternative Performance Measures (2 of 2)

NOK million		June 30 2024	December 31 2023
	Non-current borrowings	262	236
	Current borrowings	102	1 133
Gross debt		364	1 369
Less:
	Cash and cash equivalents	560	144
	Net debt (Net cash)	-196	1 225
Less:
	Non-current interest-bearing receivables	623	550
	Current interest-bearing receivable	12	0
	Net interest-bearing debt (NIBD)	-831	675

NOK million	June 30 2024	December 31 2023
Total equity	5 546	3 970
Divided by Total assets	6 418	6 048
Equity ratio	86%	66%
Cash and cash equivalents	560	144
Undrawn committed credit facilities	320	335
Liquidity reserve	880	479

NOK million	June 30 2024	December 31 2023
Current operating assets	53	606
Less: Current operating liabilities	233	339
Net current operating assets (NCOA)	-180	267
Plus:
Total non-current assets	5 785	5 279
Current finance lease receivables	9	19
Less:
Non-current interest bearing receivables	623	550
Employee benefit obligations	77	82
Other non-current liabilities	183	255
Total lease liabilities	16	34
Net capital employed (NCE)	4 714	4 645

Key figures | Group

AKASTOR GROUP

NOK million	2Q 23	3Q 23	4Q 23	1Q 24	2Q 24	YTD 2024
Revenue and other income	64	62	87	642	01	733
EBITDA	-4	-4	23	573	28	eo ت
EBIT	-11	-11	15	567	19	586
NCOA	108	314	267	872	-180	-180
Net capital employed	4 820	4 764	4 645	5 523	4 714	4 714

Key figures | Split per company (1/4)

HMH

USD million	2Q 23	3Q 23	4Q 23	1Q 24	2Q 24	YTD 2024
Revenue	189	203	208	193	208	401
EBITDA (adj) [1]	34	35	46	33	42	75
EBITDA	27	34	46	32	40	71
EBIT	16	23	19	20	28	49
Order intake	222	207	197	209	179	388
Equipment backlog [2]	231	237	237	249	229	229
NIBD (incl. shareholder loans)	282	283	271	265	289	289

1) EBITDA (adj.) excludes non-recurring expenses or costs defined as outside of normal company operations.

2) Equipment backlog defined as Project and Product orders

Key figures | Split per company (2/4)

AKOFS OFFSHORE

USD million	2Q 23	3Q 23	4Q 23	1Q 24	2Q 24	YTD 2024
Revenue and other income	28	30	37	32	35	68
EBITDA	ന	റ	ਹਤ	ி	10	ਹੈ ਭ
EBIT	-7	-5	4	-1	-0	-1
CAPEX and R&D capitalization	5	2	1	1	ਜ	ന
Net capital employed	334	328	334	326	319	379
Order intake	O	O	O	O	O	O
Order backlog	408	394	363	321	286	286
NIBD (incl. shareholder loans and lease liabilities)	358	362	351	361	363	363

Key figures | Split per company (3/4)

DDW Offshore

NOK million	2Q 23	3Q 23	4Q 23	1Q 24	2Q 24	YTD 2024
Revenue and other income	52	ട് 3	80	39	57	છે.
EBITDA	14	18	40	-8	15	7
EBIT	10	ਹਤ	35	-12	7	-5
NCOA	-188	20	32	14	-19	-ਹਰ
Net capital employed	248	256	263	316	338	338

Key figures | Split per company (4/4)

OTHER HOLDINGS

NOK million	2Q 23	3Q 23	4Q 23	1Q 24	2Q 24	YTD 2024
Revenue and other income	12	റ	7	603	34	637
EBITDA	-18	-22	-17	587	13	594
EBIT	-21	-24	-20	579	12	ਦਰਪ
NCOA	296	294	236	858	-160	-160
Net capital employed	892	908	960	1 620	843	843

Copyright and disclaimer

Copyright

Copyright of all published material including photographs, drawings and images in this document remains vested in Akastor and third party contributors as appropriate. Accordingly, neither the whole nor any part of this document shall be reproduced in any form nor used in any manner without express prior permission and applicable acknowledgements. No trademark, copyright or other notice shall be altered or removed from any reproduction.

Disclaimer

Presentation of quarterly results is not audited and may deviate from statutory reporting. This Presentation includes and is based, inter alia, on forwardlooking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this Presentation are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for Akastor ASA and Akastor ASA's (including subsidiaries and affiliates) lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for Akastor ASA. oil prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the Presentation. Although Akastor ASA believes that its expectations and the Presentation are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the Presentation. Akastor ASA is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the Presentation, and neither Akastor ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use.

AKASTOR ASA

Oksenøyveien 10, NO-1366 Lysaker, Norway P.O. Box 124, NO-1325 Lysaker, Norway +47 21 52 58 00

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