Bonheur ASA — Earnings Release 2018

Feb 12, 2019

4 quarter 2018

12 February 2019

Highlights 4Q 2018

Bonheur ASA Group of companies

Figures in paranthesis (4Q17)

100% Fred. Olsen Renewables AS Fred. Olsen Green Power AS

• EBITDA NOK 433 mill. (NOK 336 mill.)
• Total generation up 7%
• «Like for like» generation was down 5.5%
• Higher electricity prices in all markets year on year
• Investment decision on Högaliden wind farm in Sweden, approx. SEK 1.2 billion

• Verkanliden in Sweden consented and expanded, pipeline development

• Fred. Olsen Ocean Ltd. 100%

• EBITDA NOK 40 mill. (NOK 32 mill.)
• Utilization for installation vessels 79% (59%)
• Contract pipeline to end 4Q 2019 covered by 52% firm contracts
• High activity in Global Wind Service

• Acquisition of indirect 51% shareholding in company owning Transport &Installation vessel Blue Tern (ex.Seafox 5). Total investment of USD 73.6 million

• 100% Fred. Olsen Cruise Lines Ltd.

• EBITDA NOK 9 mill. (NOK 29 mill.)
• Net ticket income per diems unchanged
• Passenger days increased 6 %
• Higher share of revenues from fly cruises
• Increase in fuel costs

Dolphin Drilling ASA (DD) deconsolidated

• Recognized as discontinued operations
• Classified and valued as a financial investment
• P&L effect from deconsolidation NOK 181 million in the quarter

Post quarter event

▪ Dividend proposal of NOK 4.00 per share

Consolidated summary

Bonheur ASA Group of companies

(NOK million)	4Q 18	4Q 17	Change in NOK
Revenues	1 854	1 660	194
EBITDA	470	399	7 0
Depreciation	-267	-221	-47
Impairment	0	-16	1 6
EBIT	202	163	3 9
Net finance and result from associates	-100	-20	-80
EBT	102	143	-41
Net result from continuing operations	6 8	3 0	3 8
Net result from discontinued operations	181	-509	690
Net result	249	-479	728
Shareholders of the parent company *)	236	-271	506
Earnings per share (NOK)	5,5	-6,4	11,9
Net interest bearing debt (NIBD)	2 665	5 902	-3 237
Equity ratio	38 %	37 %

	Discontinued operations (DD)
Net result from discontinued operations in the quarter ▪ consist of the following elements:
▪	Result in DD October	NOK -	128 million
▪	Net balance sheet effects from deconsolidation	NOK	260 million
▪	Fair value of shares in DD	NOK	48 million
	Net result from discontinued operations		NOK 181 million

*) The non-controlling interests mainly consist of 44.06% of NHST Media Group AS and 49% in Fred. Olsen Wind Limited (FOWL) (UK), 49% of Fred. Olsen CBH Limited (FOCBH) (UK) and 49% of Seafox5 Limited

Segment analysis – Revenues

Bonheur ASA Group of companies

(NOK million)	4Q 18	4Q 17	Change
Renewable energy	570	467	103
Shipping/Offshore wind	413	364	4 9
Cruise	527	476	5 1
Other	343	352	-9
Total Revenues	1 854	1 660	194
NOK / USD (average)	8,44	8,16	3,4 %
NOK / EUR (average)	9,63	9,62	0,2 %
NOK / GBP (average)	10,86	10,84	0,2 %

Segment analysis – EBITDA

Bonheur ASA Group of companies

	N Bonheur ASA

(NOK million)	4Q 18	4Q 17	Change
Renewable energy	433	336	9 7
Shipping/Offshore wind	4 0	3 2	8
Cruise	9	2 9	-20
Other	-12	2	-14
Total EBITDA	470	399	7 0

Cash, Debt and Guarantees as per 4Q 18

Bonheur ASA Group of companies

(NOK million)	Cash	External debt	Whereof guaranteed by Bonheur
Renewable energy (FOR) (Joint Ventures and associated holding companies)	652	4 612	23	*)
Shipping / Offshore wind (FOO) (Joint Venture and associated holding companies)	231	611		**)
Sum companies owned between 50% and 100%	883	5 224
Renewable energy (FOR) (excl. Joint Ventures and associated holding companies)	267	0	0
Shipping / Offshore wind (FOO) (excl. Joint Ventures and associated holding companies)	235	743	721
Cruise (FOCL)	585	0	-
Bonheur ASA (parent company) + Other	3 712	2 437	-
Sum (excl. Joint Ventures and associated holding companies)	4 799	3 181	721

*) NOK 3 932 million of the external debt is ring fenced in a joint venture of Fred. Olsen Wind Ltd. (FOWL) with The Renewables Infrastructure Group Ltd. and Fred. Olsen CBH Limited (FOCBH) with Aviva Investors Global Services Ltd. Non-recourse to Fred. Olsen Renewables AS (FORAS).

In addition NOK 680 million of the external debt is ring fenced within Fred. Olsen CB Ltd. (FOCB), which is 100% owned by FORAS. Non-recourse to FORAS.

**) FOO will acquire its pro rata share (51%) of a shareholder loan of USD 21.3 million, amounting to USD 10.8 million

Dolphin Drilling ASA (DD)

Deconsolidation of DD comes, among other things, as a consequence of:

• Bonheur has throughout proposed and supported various potential refinancing solutions for DD including contributing significant new capital; however the composition of the secured lenders has prevented implementation
• The secured lenders of DD have decided to pursue other solutions
• These solutions have not been in line with Bonheur's strategy and will not cause Bonheur to contribute capital to be a majority shareholder
• DD debt is non-recourse to Bonheur
• DD has since the 1970s pioneered offshore drilling and delivered excellent operating performance

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▪ Bonheur's investment has since the IPO in 1997 yielded NOK 6.9 billion through dividends and share sale proceeds

Renewable energy

9

Renewable energy

Capacity Factors and Generation

Generation and prices

0%

10%

20%

30%

Capacity factor (%)

40%

50%

60%

• 100 000 200 000 300 000 400 000 500 000 600 000 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 Generation (MWh) UK (total) Sweden Norway Generation (MWh) Capacity factor = £20 £30 £40 £50 £60 £70 Prices for UK (£/MWh)

Source: Nordpool

Power prices (quarterly average)

Renewable energy

Key financials

• Seasonal generation pattern (1Q and 4Q higher, 2Q an 3Q lower)
• Rolling 12 months EBITDA increasing and at all time high exceeding NOK 1 billion in 3Q18 and 4Q18
• Power prices (per MWh) in UK, Norway and Sweden were on average £63 (£50), €47.2 (€30) and €47.5 (€30), respectively, in the quarter

New windfarm project

Investment decision on Högaliden

• Högaliden windfarm in Sweden has commenced construction
• Located within close proximity of existing Fäboliden windfarm and infrastructure
• Power production capacity of 105 MW (25x 4.2 MW Vestas WTGs)
• Total investment of ~SEK 1.2 bn.
• Commercial operation date (COD) expected in December 2020

Renewable energy

Business Model and Project Portfolio

Site Investigation	Development			Operation	Pipeline developments
Scotland Norway Sweden France	Scotland – 300-400 MW Crystal Rig extension Rothes extension Paul's Hill extension Brockloch Rig III (formerly Windy Standard III) Fetteresso Portfolio Norway Portfolio Sweden – 300-400 MW Fäbodliden II Portfolio Ireland – 500 MW Codling II – 500 MW offshore (50% owned; total 1000 MW) France – 200-250 MW Portfolio (51% owned of total 400-500 MW) USA Icebreaker – 20.7 MW offshore (Lake Erie)	Consented Ireland Codling Bank – 500 MW offshore (50% owned; total 1000 MW) Norway Gilja – 135 MW Sweden Verkanliden 160 MW	Construction Sweden Högaliden 105 MW	Scotland Crystal Rig – 62.5 MW Crystal Rig II - 138.0 MW Rothes – 50.6 MW Rothes II – 41.4 MW Paul's Hill – 64.4 MW Mid Hill – 75.9 MW Crystal Rig III – 13.8 MW Brockloch Rig Windfarm (formerly Windy Standard II) – 61.5 MW Brockloch Rig 1 – 21.6 MW Norway Lista – 71.3 MW Sweden Fäbodliden - 78 MW	Commenced construction on ▪ Högaliden Consent and expansion of ▪ Verkanliden Extension of development ▪ portfolios in Scotland, Sweden and Norway
Total portfolio	1 320 – 1 570 MW	795 MW	105 MW	679 MW
Onshore portfolio	820 – 1 070 MW	295 MW	105 MW	679 MW

Shipping / Offshore wind

Acquisition

Fred. Olsen Windcarrier's investment in Blue Tern (previously Seafox 5)

• Total investment of USD 73.6 mill.
• 51% share purchase (USD 62.8 mill.) and pro rata share in shareholders' loans (USD 10.8 mill.)
• Funding from Bonheur ASA
• Multi purpose jack -up construction vessel for offshore wind T&I and oil & gas decommissioning
• Built 2012, 106 meter legs (water depth 65 m), crane 1200 MT, capable for future upgrading
• FOWIC to have full commercial and technical management of the vessel
• Commercial and operational synergies with existing vessels favoring e.g. US and Asian markets as well as next generation turbines, comes with contract backlog
• Existing financing by way of bank loans equivalent to EUR 43.5 mill. and a shareholder loan of USD 21.3 mill of which FOWIC will acquire 51%
• Subsidiary of Keppel Offshore and Marine Ltd. remains a 49% owner

https://youtu.be/InLK2d6vqks

Main players in the offshore wind installation jack-up market

Offshore wind power becoming increasingly competitive

A rapid expansion in capacity for offshore wind is driven by decrease in costs

Shipping / Offshore wind (Fred. Olsen Ocean)

Key financials

Fred. Olsen Windcarrier AS Universal Foundation A/S Global Wind Service A/S

Three modern transport and installation vessels (T&I) and seven crew transfer vessels Providing the innovative Mono Bucket Foundation Leading installation company with ~800 employees 18

▪ Events in the quarter:

• Utilization for installation vessels 79% (59%)
• Contract pipeline into end 4Q 2019 covered by 52 % firm contracts
• High activity in GWS
• Aquisition of indirect 51% shareholding in Seafox 5 Limited (SF5)
• SF 5 owns T&I vessel Blue Tern (ex Seafox 5), a multipurpose jack-up construction vessel
• Total investment USD 73.6 million

Cruise

Cruise Key financials

• Passenger days were 257 000 in the quarter (243 200), an increase of 6%
• Net Ticket Income per passenger day was GBP 127 in the quarter (GBP 127)
• Higher share of fly cruises in the quarter
• Higher fuel costs
• Seasonal pattern (2Q and 3Q higher, 1Q an 4Q lower)

(Figures in NOK million)	4Q 18	4Q 17
Operating revenues	527	476
EBITDA	9	29
EBITDA margin	2 %	6 %
Net result after tax	-97	-21
Capex	60	187
Equity	1 104	1 115
Gross interest bearing debt	0	0
- Cash and cash equivalents	585	571
= Net interest bearing debt (NIBD)	-585	-571
Capital employed (Equity + NIBD)	519	544

Highlights 4Q 2018

Bonheur ASA Group of companies

Figures in paranthesis (4Q17)

100% Fred. Olsen Renewables AS Fred. Olsen Green Power AS

• EBITDA NOK 433 mill. (NOK 336 mill.)
• Total generation up 7%
• «Like for like» generation was down 5.5%
• Higher electricity prices in all markets year on year
• Investment decision on Högaliden wind farm in Sweden, approx. SEK 1.2 billion

• Verkanliden in Sweden consented and expanded, pipeline development

• Fred. Olsen Ocean Ltd. 100%

• EBITDA NOK 40 mill. (NOK 32 mill.)
• Utilization for installation vessels 79% (59%)
• Contract pipeline to end 4Q 2019 covered by 52% firm contracts
• High activity in Global Wind Service

• Acquisition of indirect 51% shareholding in company owning Transport &Installation vessel Blue Tern (ex.Seafox 5). Total investment of USD 73.6 million

• 100% Fred. Olsen Cruise Lines Ltd.

• EBITDA NOK 9 mill. (NOK 29 mill.)
• Net ticket income per diems unchanged
• Passenger days increased 6 %
• Higher share of revenues from fly cruises
• Increase in fuel costs

Dolphin Drilling ASA (DD) deconsolidated

• Recognized as discontinued operations
• Classified and valued as a financial investment
• P&L effect from deconsolidation NOK 181 million in the quarter

Post quarter event

▪ Dividend proposal of NOK 4.00 per share