DOF ASA

Quarterly Report • Feb 21, 2020

Q4 2019 DOF ASA Financial Report

Management reporting: Accounts 4th quarter 2019

RESULT

(MNOK)	Q4 2019	Q4 2018	2019	2018
Operating income	1 979	1 704	7 524	6 938
Operating expenses	-1 199	-1 214	-4 808	-4 868
Net profit from associated and joint ventures	-32	2	-47	-5
Net gain on sale of tangible assets	-	-	4	2
Operating profit before depreciation and impairment - EBITDA	749	493	2 673	2 066
Depreciation	-323	-339	-1 314	-1 240
Impairment	-328	-340	-1 449	-737
Operating profit - EBIT	98	-186	-90	89
Financial income	-	25	42	51
Financial costs	-321	-307	-1 273	-1 099
Net realised gain/loss on currencies	-10	-130	-255	-352
Profit before unrealised finance costs	-234	-598	-1 576	-1 311
Unrealised finance costs	-53	-229	-763	-294
Profit (loss) before taxes	-287	-827	-2 340	-1 604
Taxes	-226	53	-542	102
Profit (loss)	-512	-774	-2 881	-1 502

BALANCE

(MNOK)	31.12.2019	31.12.2018
ASSETS
Tangible assets	24 303	25 074
Goodwill	85	295
Deferred taxes	200	1 006
Investment in associated companies and joint ventures	45	89
Other non-current financial assets	263	109
Total non-current assets	24 896	26 572
Receivables	1 761	1 851
Cash and cash equivalents	1 715	2 240
Total current assets	3 475	4 091
Total assets	28 371	30 663
EQUITY AND LIABILITIES
Equity	3 451	5 778
Non-current liabilities	18 201	19 406
Current liabilities	6 719	5 479
Total liabilities	24 920	24 885
Total equity and liabilities	28 371	30 663
Net interest bearing liabilities excluded effect of IFRS 16	21 169	20 952

CASH FLOW

(MNOK)	Q4 2019	Q4 2018	2019	2018
Net cash from operation activities	523	577	1 539	1 259
Net cash from investing activities	-77	-207	-1 312	-1 430
Net cash from financing activities	-424	130	-722	26
Net changes in cash and cash equivalents	21	500	-495	-145
Cash and cash equivalents at start of the period	1 679	1 750	2 240	2 434
Exchange gain/loss on cash and cash equivalents	15	-10	-30	-50
Cash and cash equivalents at the end of the period	1 715	2 240	1 715	2 240

Index

Financial report 4th Quarter 2019	4
Accounts Q4 2019	10
Consolidated statement of profit or loss	10
Consolidated statement of balance sheet	11
Consolidated statement of equity	12
Consolidated statement of cash flows	13
Notes to the Accounts	14
Note 1 General	14
Note 2 Management reporting	15
Note 3 Segment information - management reporting	16
Note 4 Operating income	17
Note 5 Hedges	17
Note 6 Tangible assets	18
Note 7 Goodwill	19
Note 8 Taxes	19
Note 9 Investment in associates and joint ventures	20
Note 10 Cash and cash equivalent	20
Note 11 Interest bearing liabilities	21
Note 12 Subsequent events	23
Note 13 Transaction with related parties	23
Note 14 Adoption of IFRS 16 Lease from 1 January 2019	24
Note 15 Share capital and shareholders	25
Note 16 Performance measurements definitions	26

Financial report 4th Quarter 2019

KEY INFORMATION

Group EBITDA (management reporting) of NOK 805 million (NOK 546 million) excl. hedge accounting

Fleet utilisation of 83%

• 80% subsea fleet, 77% AHTS fleet and 94% PSV fleet, 5 vessels in lay-up by end of the quarter

Total fleet of 67 vessels:

• 20 AHTSs, 16 PSVs, 31 Subsea vessels, 74 ROVs
• General market & operational comments:
  • › Improved earnings and utilisation for the PSV and AHTS fleet in the North Sea
  • › Improved earnings and utilisation for Subsea IMR project fleet
  • › Stable earnings for the fleet in Brazil
• The long-term refinancing solution has been delayed and is expected to be concluded within 1st quarter 2020

*) Based on management reporting.

KEY FIGURES

	Management reporting		Management reporting
(MNOK)	Q4 2019	Q4 2018	2019	2018
Operating income	1 979	1 704	7 524	6 938
EBITDA	749	493	2 673	2 066
EBIT	98	-186	-90	89
Net financial costs	-384	-641	-2 249	-1 693
Profit (loss)	-512	-774	-2 881	-1 502
EBITDA - before hedge	805	546	2 861	2 246
NIBD (Net interest bearing debt)			21 499	20 952
NIBD (Net interest bearing debt) excluded effect of IFRS 16			21 169	20 952
Equity ratio			12%	19%

Q4 Operations

The Q4 operational result per segment is as follows;

(MNOK)	PSV	AHTS	Subsea	Total
Operating income	140	294	1 545	1 979
Operating result before depreciation and impairment - EBITDA	39	129	581	749
Depreciation	34	83	206	323
Impairment	60	63	205	328
Operating result - EBIT	-55	-17	170	98
EBITDA margin	28%	44%	38%	38%
EBIT margin	-39%	-6%	11%	5%

The main part of the Group's PSV and AHTS fleet operates on firm contracts or in the spot market, while the subsea fleet is partly utilised on term contracts or on subsea IMR (Inspection, Maintenance, and Repair) project contracts.

PSV

The PSV fleet includes 16 vessels of which one vessel is owned via a minority share. The majority of the fleet has operated in the North Sea market on term contracts in the period. The average utilisation for the PSV fleet was 94% compared to 87% in 4th quarter 2018. One vessel left the North Sea after completion of a minor conversion and started on a five-year contract with Esso Australia in October.

In the North Sea, a 6-month contract was awarded for the Skandi Barra in November and a 1-year option applicable from February 2020 was exercised for the Skandi Kvitsøy in December. In Italy, multiple contracts were awarded including two PSVs, and Skandi Buchan and Skandi Foula have sailed from Guyana to the Mediterranean to serve these contracts.

AHTS

The AHTS fleet includes 18 vessels and additional two vessels on management. Five vessels are 50% owned via DOF Deepwater AS and one vessel is owned via a minority share in Iceman AS. The average utilisation for the AHTS fleet was 77% in the quarter and 65% in the 4th quarter 2018.

11 vessels have operated in South America, whereof 10 in Brazil and one in Argentina. The fleet in Brazil has during the period operated on firm contracts whereof the majority of the fleet has local flag. The contract in Argentina was terminated in December and this vessel was idle by end of the year. In the North Sea, the spot market has been busy during 4th quarter and the fleet has achieved utilisation and earnings significantly better compared to same period last year. However, by end of the year the activity declined, and the North Sea activity has continued with low activity so far in 2020. One vessel was in December reactivated from lay-up for a contract and sailed for a 75-day contract in Italy/Mediterranean. In Asia-Pacific, two vessels have operated outside New Zealand to support drilling activities. Three AHTS vessels were idle or in lay-up by end of the year.

Equinor exercised a 6-month option on the Skandi Vega from November. In addition, one AHTS was awarded a 75-day + options as part of the multiple vessel contracts in Italy. Skandi Saigon started on this contract in January 2020.

SUBSEA

During the 4th quarter, the Group operated a fleet of 31 Subsea vessels, including two vessels hired from external owners. The majority of the fleet is owned by the subsidiary DOF Subsea AS.

The revenues from the subsea operation include revenues from subsea IMR project contracts and time charter contracts, mainly performed by DOF Subsea. The revenues from the subsea IMR contracts during the 4th quarter amounted to NOK 825 million (NOK 767 million). The Group's subsea IMR activities are operated from the Atlantic region, the Asia-Pacific region, the North America region, and the South America (Brazil) region. The overall utilisation of the subsea fleet was 80% in the 4th quarter and 69% in the same period last year.

The average utilisation for the Subsea IMR/project fleet has been 79% (65%) in the quarter. The Asia-Pacific region has achieved a higher utilisation of its fleet compared to the same period last year, and has conducted IMR and survey work outside Australia, New Zealand, the Philippines, and Malaysia in the quarter. In the Atlantic region, in particular the North Sea region has shown weak activity in the period and two vessels have been idle the entire quarter. In the North America region, the activity has been stable both in Canada and in the GoM and the region has mainly conducted IMR and installation work during the quarter. This region has also served a contract including RSV services in the Middle East. The Brazil region has been engaged in ROV inspection and diving work contracts with Petrobras.

All the four DOFCON PLSVs operating on long-term contracts with Petrobras have achieved high utilisation during the quarter. In addition, Skandi Niteroi went on-hire on a contract with TechnipFMC at the Peregrino field in October. Skandi Vitoria has been reactivated from lay-up for a 2-year contract with TechnipFMC.

DOF Subsea was during the quarter awarded two contracts in Africa for the Skandi Seven and the Skandi Skansen in Angola and in Ghana respectively. In the North America region, Skandi Neptune was awarded a 3-year frame agreement for IMR and light construction in Trinidad. In the Asia-Pacific region, Skandi Hercules and Skandi Singapore were awarded various contracts securing utilisation into 1st quarter 2020. In the North Sea, the Skandi Carla has been awarded an extension and is firm until October 2020.

Main Items Interim Accounts Q4 – Financial Reporting The below figures represent the Group's consolidated accounts based on Financial Reporting.

RESULT

(MNOK)	Q4 2019	Q4 2018	2019	2018
Operating income	1 624	1 471	6 276	6 051
EBITDA	519	373	1 815	1 629
EBIT	44	-237	-387	-125
Net financial costs	-325	-527	-1 909	-1 435
Profit (loss)	-512	-774	-2 881	-1 502

P&L 4 TH QUARTER

The Group has adopted the new accounting standard for IFRS 16 Leases and applied the simplified transition approach, and comparative amounts for the year prior to first adoption are not restated. Total assets at the end of 2019 are affected by the implementation of the standard by NOK 423 million and liabilities are affected with NOK 461 million. This has increased the lease liabilities, net investment, and right-of-use assets compared to the financial position as reported previous period.

Total revenues and operating costs are higher than the same period last year and reflect improved performance within the subsea IMR segment and higher vessel utilisation. Net profit from associated companies was NOK 5 million (NOK 70 million) and represents operations from the DOFCON JV and the DOF Deepwater JV. The Group Ebitda was NOK 519 million (NOK 373 million) and the Ebit was NOK 44 million (NOK -237 million). Total depreciation and impairment were NOK 476 million (NOK 610 million). Impairments booked in the period are NOK 213 million (NOK 332 million). In addition, an impairment of NOK 115 million (NOK 8 million) has been booked in the joint ventures.

Net financial costs were negative with NOK -325 million (NOK -527 million) and include net interest costs of NOK -245 million (NOK -188 million) and net loss on currencies and financial instruments of NOK -81 million (NOK -339 million) of which unrealised gain mainly relates variances in USD and NOK/BRL from long-term debt from the subsidiaries DOF Subsea and Norskan.

The Group's operation in Brazil is based on firm charter contracts mainly in USD secured with debt in corresponding currency, hence the Group has been more or less cash neutral related to fluctuation in BRL and USD. The Group has used hedge accounting for some of the long-term contracts in Brazil, but due to several contract renewals in 2020 the remaining hedge positions have been released during the quarter. The impact on the financial result is NOK -267 million.

Deferred tax assets have been impaired with in total NOK 169 million.

Revenue year to date is higher than last year resulting in a higher Ebitda of NOK 1,815 million (NOK 1,629 million). The Ebit year to date was NOK -387 million (NOK -125 million) and has been highly impacted by impairments on vessels and goodwill. Net financial result was NOK -1,909 million (NOK -1,435 million) and include loss on unrealised currency and release of hedge accounting position. The loss before taxes is NOK -2,296 million (NOK -1,560 million).

BALANCE

(MNOK)	31.12.2019	31.12.2018	Change %
Non-current assets	20 273	22 815	-11%
Current assets	1 795	1 718	5%
Cash and cash equivalents	1 395	1 932	-28%
Total assets	23 464	26 465	-11%
Equity	3 451	5 778	-40%
Non-current liabilities	13 694	15 578	-12%
Current liabilities	6 318	5 110	24%
Total equity and liabilities	23 464	26 465	-11%
Net interest bearing debt (NIBD)	16 888	17 089	-1%
Net interest bearing debt (NIBD) excl. effect IFRS 16	16 558	17 089	-3%

Of the Group's total balance of NOK 23,464 million (NOK 26,465 million), vessels and subsea equipment amount to NOK 17,765 million (NOK 18,898 million). 11 vessels are owned via joint ventures and are represented as associated companies and non-current receivables in the balance sheet, in total NOK 2,410 million (NOK 2,724 million). Goodwill amounts to NOK 85 million (NOK 295 million). Total equity is NOK 3,451 million (NOK 5,778 million) and includes a noncontrolling interest of NOK 186 million (NOK 2,269 million).

Cash flow from Q4 2019

Operational cash flow after payment of interest and taxes was in the 4th quarter NOK 375 million (NOK 413 million), and net cash flow from investing activities was NOK 20 million (NOK -149 million). Net cash flow from financing activities was NOK -322 million (NOK 225 million).

Financing and Capital Structure

The Group is mainly funded by secured debt 65%, unsecured debt/bonds 11%, and equity 15%. The remaining funding represents net working capital and financial lease debt (IFRS 16).

The remaining outstanding of the convertible bond loan is by end of the year NOK 87 million and is booked as equity.

The Board and Management have since 2nd quarter been working on a long-term refinancing solution for the Group which includes discussions with the banks, the bondholders, and the main shareholders. In parallel, the Group has agreed deferral of instalments and amendments of financial covenants until end of February 2020. The negotiations with the banks and bondholders are progressing well, however the discussions have taken longer time than expected. The Board and Management still believe that a long-term solution is achievable within 1st quarter 2020, however no assurance can be given at this time.

The key terms of the refinancing discussions with the banks in DOF Subsea are to extend the bank facilities with four years including new financial covenants and reduced amortisation profile with a step-up mechanism during the term of the facilities. In addition, a new guarantee facility will be established.

In respect of the DOF Subsea's outstanding bonds, the majority of the bondholders approved on the 20th of December 2019 to extend the maturity as follows:

• DOFSUB07 extension to April 2024
• DOFSUB08 extension to May 2025
• DOFSUB09 extension to October 2025

The interest margin will be reduced for the first three years with a PIK structure. In addition, a call structure shall be established. A summons for a meeting on the 27th of February 2020 to final approve the above was sent to the bondholders on 12th of February. The approval is subject to completion of the bank refinancing in DOF Subsea.

The DOFCON JV is not part of the refinancing discussions and all debt are assumed served with original amortisation.

For the Group's bank facilities in Brazil (BNDES), a reduced amortisation profile applicable from 1st of January 2020 has been approved and agreed. In DOF Rederi and DOF Deepwater, the Management is in discussion to extend the facilities until end 2023 and mainly include extension of soft amortisation profile and amendment of financial covenants.

Upon approval of the proposal by bondholders and approval by the banks of the term sheets for the refinancing, a rights offering with preferential rights for existing shareholders in the Company will be conducted, subject to satisfactory refinancing terms with the banks and bondholders in the Group. The largest indirect shareholder of the Company, Laco AS, has committed to indirectly subscribe for NOK 200 million in such rights offering. NOK 200 million in the rights issue is assumed to be injected in DOF Subsea AS.

The vessels and subsea assets (including the JVs) constitute 86% of the Group's total assets, hence the Group's balance sheet is exposed to fluctuations in the valuations of these assets. As part of the quarterly impairment testing, the updated broker estimates have proven minor decrease in valuation of the fleet, however, there is still a risk that the values may continue to drop.

As part of the approved waivers for the DOF Group (excluding DOF Subsea), the minimum free liquidity is reduced from NOK 500 million to NOK 250 million. As part of the approved waivers, the minimum booked equity requirement of NOK 3,000 million and minimum LTV (Loan to value) of 100% are unchanged. For DOF Subsea, the main financial covenants are NOK 500 million in minimum free liquidity, and a minimum value adjusted equity ratio of 30% (based on management reporting). By end of the year the DOF Group and DOF Subsea Group were in compliance with all its financial covenants, ref note 11 to the accounts.

The majority of the Group's vessels on long-term contracts are funded in corresponding currency, mainly USD, hence the Group's cash is, to a limited extent, exposed to fluctuation in currency. However, the Group's and its subsidiaries profit and loss accounts and balance sheets are highly impacted by the fluctuation in currency.

The portion of long-term debt secured with fixed rate of interest is approximately 70% of total debt and includes the debt with fixed interest in BNDES (Brazilian Development Bank).

In November, the Company entered into a share purchase agreement with two companies controlled by First Reserve to purchase their 35% stake in DOF Subsea AS. Upon completion of this acquisition, the Company is the sole shareholder of DOF Subsea AS.

Shareholders

By the end of December, the total share capital was NOK 308 million divided into 308 million shares. The main shareholder Møgster Mohn Offshore AS controls 48.95% of the Company and 47.6% on a fully diluted basis.

Employees

As of 31st of December, the Group employed 3,501 employees including hired staff, which is a decrease from the previous quarter. The total comprises 2,032 marine personnel, 1,149 subsea segment personnel, 261 onshore marine management personnel, and 59 IT services personnel.

Health, Safety, Environment and Quality

There were not identified any significant HSEQ issues during the 4th quarter.

Events after balance date

DOF Subsea has in January been awarded contracts in Australia and in the North America region, and secured utilisation for the Skandi Singapore, Skandi Neptune, and the hired in vessel Harvey Deep Sea well into 1st quarter 2020. The 50% owned PLSV Skandi Vitoria has been awarded a contract with TechnipFMC for two years + options. This contract has commenced in January 2020.

A summons for a meeting on 27th of February has been sent to the bondholders in DOFSUB07, DOFSUB08, and DOFSUB09. The summons is based on agreement in the bondholder meeting in 20th of December 2019.

In February, DOF Subsea was awarded a 5-year contract + options for Geosea with N-Sea.

Outlook

The North Sea markets within supply (PSV and AHTS) have continued to prove better utilisation, however, even with the modest improvement in rates and utilisation for the AHTS fleet, the average earnings are not sustainable. As part of seasonal variations, the North Sea market activity has declined so far in 2020. In Brazil, the market is expected to be weak the next 12 months. The Group has several contracts up for renewal in 2020, which increases the risk regarding utilisation and earnings in this region. Earnings for the Subsea IMR fleet have been better in the quarter compared to the same period last year and the Asia-Pacific and North America region have proven increased activity. However, there is still an oversupply of vessels and the Group expects reduced earnings in certain regions and especially in the North Sea during the winter season.

The Group will maintain its strategy to secure the fleet on term contracts and is actively working on keeping the firm employment of the fleet as high as possible. The majority of the Group's high-end vessels are committed on firm contracts and represent the largest portion of the Group's backlog. The OSV sector has the last few years experienced very challenging market conditions and the recovery has taken longer than expected. Nevertheless, the Group's backlog is still high.

A continuing weak market brings a risk of lower utilisation and earnings of the Group's vessels and further increases the liquidity risk for the Group. As reported since 2nd quarter, the Board and Management have been working on a long-term solution to secure satisfactory financing and liquidity for the Group throughout a continuing demanding period. The discussions with the relevant stakeholders have been constructive and the progress is good, however no assurance can be given that the Group will be successful in this respect. The effect of not being able to obtain a long-term financial solution will affect the classification of debt (described in note 11 ´Interest bearing debt´ to the quarterly accounts) and may also affect the ´going concern´ assumption. If the Group cannot be treated as ´going concern´, the valuation of the Group's assets must be further revised. Even though there is uncertainty if a long-term financial solution will be achieved, the Board of Directors and Management believe that a solution is obtainable within end of 1st quarter.

The Board of Directors expects today the Group's Ebitda for 2020 to be in line or slightly higher than the Ebitda for 2019.

IR contacts

Mons S. Aase, CEO +47 91661012, mons.aase@dof.com Hilde Drønen, CFO +47 91661009, hilde.dronen@dof.com

DOF ASA 5392 Storebø www.dof.com

The Board of Directors of DOF ASA, February 20th, 2020

Helge Møgster Chairman

Helge Singelstad Deputy Chairman

Kathryn Baker

Marianne Møgster Hans Olav Lindal Mons S. Aase

CEO

Accounts Q4 2019

Consolidated statement of profit or loss

(MNOK)	Note	Q4 2019	Q4 2018	2019	2018
Operating income	1	1 624	1 471	6 276	6 051
Operating expenses		-1 110	-1 168	-4 517	-4 700
Net profit from associated and joint ventures	9	5	70	52	277
Net gain on sale of tangible assets		-	-	4	2
Operating profit before depreciation and impairment - EBITDA		519	373	1 815	1 629
Depreciation	6	-263	-278	-1 071	-1 063
Impairment	6,7	-213	-332	-1 130	-691
Operating profit - EBIT		44	-237	-387	-125
Financial income		10	67	97	121
Financial costs		-255	-255	-1 024	-925
Net realised gain/loss on currencies		-6	-127	-237	-341
Net unrealised gain/loss on currencies		-156	-98	-862	-288
Net changes in fair value of financial instruments		81	-114	117	-2
Net financial costs		-325	-527	-1 909	-1 435
Profit (loss) before taxes		-281	-764	-2 296	-1 560
Taxes	8	-231	-10	-585	57
Profit (loss) for the period		-512	-774	-2 881	-1 502
Profit attributable to
Non-controlling interest		-23	-168	-402	-235
Controlling interest		-489	-606	-2 480	-1 267
Earnings per share (NOK)		-1,55	-1,92	-7,84	-4,09
Diluted earnings per share (NOK)		-1,55	-1,92	-7,84	-4,09

Consolidated statement of comprehensive income

(MNOK)	Note	Q4 2019	Q4 2018	2019	2018
Profit (loss) for the period		-512	-774	-2 881	-1 502
Items that will be subsequently reclassified to profit or loss
Currency translation differences		51	1	24	-68
Cash flow hedge	5	456	174	712	-260
Cash flow hedge - impairment deferred tax	8	-	-	-240	-
Share of other comprehensive income of joint ventures	9	-49	104	66	123
Items that not will be reclassified to profit or loss
Defined benefit plan actuarial gain (loss)		12	3	12	3
Other comprehensive income/loss net of tax		471	282	574	-202
Total comprehensive income/loss		-42	-492	-2 307	-1 705
Total comprehensive income/loss net attributable to
Non-controlling interest		-14	-124	-363	-198
Controlling interest		-28	-368	-1 945	-1 506

Consolidated statement of balance sheet

(MNOK)	Note	31.12.2019	31.12.2018
ASSETS
Tangible assets	6	17 765	18 898
Goodwill	7	85	295
Deferred tax assets	8	13	898
Investment in associates and joint ventures	9	1 806	1 547
Other non-current receivables		604	1 177
Total non-current assets		20 273	22 815
Trade receivables		1 200	1 312
Other receivables		595	406
Current receivables		1 795	1 718
Restricted deposits		216	316
Cash and cash equivalents		1 179	1 616
Cash and cash equivalents incl. restricted deposits	10	1 395	1 932
Current assets		3 190	3 650
Total Assets		23 464	26 465
EQUITY AND LIABILITIES
Paid in equity		3 178	3 277
Other equity		87	232
Non-controlling interests		186	2 269
Total equity		3 451	5 778
Bond loan	11	2 122	2 480
Debt to credit institutions	5, 11	11 170	13 007
Lease debt		370	-
Other non-current liabilities		33	90
Non-current liabilities		13 694	15 578
Current portion of debt	11	4 900	3 678
Accounts payable Other current liabilities		759 660	808 623
Current liabilities		6 318	5 110
Total liabilities		20 013	20 687
Total equity and liabilities		23 464	26 465

Consolidated statement of equity

				Other equity -
		Other	Other equity -	Currency	Other equity		Non
	Paid-in	contributed	Retained	translation	- Cash flow	Total other	controlling	Total
(MNOK)	capital	capital	earnings	differences	hedge	equity	interest	equity
Balance at 01.01.2019	3 277	232	544	196	-740	232	2 269	5 778
Result (loss) for the period	-244		-2 236			-2 236	-402	-2 881
Other comprehensive income/loss			40	24	472	535	39	575
Reclassification between CTA and cash flow hedge				-14	14	-		-
Total comprehensive income for the period	-244	-	-2 196	10	486	-1 700	-363	-2 307
Converted bond loan	145	-145				-145		-
Changes ownership non-controlling interest			1 700			1 700	-1 720	-20
Total transactions with the owners	145	-145	1 700	-	-	1 555	-1 720	-20
Balance at 31.12.2019	3 178	87	48	206	-254	87	186	- 3 451
Balance at 01.01.2018	3 393	276	1 473	232	-537	1 444	2 505	7 342
Result (loss) for the period	-362		-906			-906	-235	-1 502
Other comprehensive income/loss			-	20	-260	-239	37	-202
Reclassification between CTA and cash flow hedge				-57	57	-		-
Total comprehensive income for the period	-362	-	-905	-36	-203	-1 145	-198	-1 705
Share issue	202		-11			-11		191
Converted bond loan	43	-43				-43		-
Dividend to non-controlling interest							-31	-31
IFRS 9 implementation effect			-17			-17	-9	-25
Adjustment of merger effect in subsidiary Total transactions with owners	245	-43	4 -24	-	-	4 -67	2 -38	6 141
Balance at 31.12.2018	3 277	233	544	196	-740	232	2 269	5 778

Key figures

		Q4 2019	Q4 2018	2019	2018
EBITDA margin ex net gain on sale of vessel	1	32%	25%	29%	27%
EBITDA margin	2	32%	25%	29%	27%
EBIT margin	3	3%	-16%	-6%	-2%
Cashflow per share (controlling interest)	4	0,80	1,12	1,48	3,90
Profit per share (controlling interest)	5	-1,54	-1,92	-7,84	-4,02
Profit per share ex. unrealised gain/loss on currencies and changes fair value of financial instruments (controlling interest)	6	-1,33	-1,52	-5,73	-3,37
Return on net capital	7			-83%	-26%
Equity ratio	8			15%	22%
Net interest bearing debt				16 888	17 089
Net interest bearing debt excl. effect of IFRS 16				16 558	17 089
Number of shares *)		307 762 779	293 237 779	307 762 779	293 237 779
Potential average number of shares *)		316 456 168	316 456 168	316 456 168	309 817 198
Potential number of shares *)		316 456 168	316 456 168	316 456 168	316 456 168

1) Operating profit before net gain on sale of vessel and depreciation in percent of operating income.

2) Operating profit before depreciation in percent of operating income.

3) Operating profit in percent of operating income.

4) Pre-tax result + depreciation and impairment +/- unrealised gain/loss on currencies +/- net changes in fair value of financial instruments/potential average no of shares.

5) Result /potential average no. of shares. 6) Result + net unrealised currency gain/loss + net changes fair value of financial instruments/potential average no of shares.

7) Result incl non-controlling interest/total equity

8) Total equity/total balance

*) The shares in DOF ASA has been consolidated in the ratio of 10:1 in May 2018. Comparable figures are revised.

Consolidated statement of cash flows

(MNOK)	Q4 2019	Q4 2018	2019	2018
Operating result	44	-237	-387	-125
Depreciation and impairment	475	610	2 202	1 754
Gain/loss on disposal of tangible assets	-	-	-4	-2
Share of profit/loss from associates and joint ventures	-5	-70	-52	-277
Changes in accounts receivables	293	259	112	267
Changes in accounts payable	-164	-69	-50	-65
Changes in other working capital	62	104	204	201
Exchange rate effects on operating activities	-108	60	-152	-116
Cash from operating activities	597	657	1 874	1 637
Interest received	10	6	69	19
Interest paid	-212	-238	-980	-920
Taxes paid	-21	-12	-44	-34
Net cash from operating activities	375	413	919	701
Payments received for sale of tangible assets	-	-	6	2
Purchase of tangible assets	-69	-171	-510	-510
Payments received for sale of shares	-	-	-	-
Purchase of shares	-	-12	-4	-22
Received dividend	-	-	2	-
Other investments	89	34	506	20
Net cash from investing activities	20	-149	-1	-511
Proceeds from borrowings	-	904	-	1 629
Repayment of borrowings	-302	-679	-1 403	-2 219
Share issue	-	-	-	191
Purchase of convertible bond	-	-	-	-
Payments to non-controlling interests	-20	-	-20	-31
Net cash from financing activities	-322	225	-1 423	-430
Net changes in cash and cash equivalents	73	490	-504	-239
Cash and cash equivalents at the start of the period	1 295	1 468	1 932	2 238
Exchange gain/loss on cash and cash equivalents	28	-26	-33	-67
Cash and cash equivalents at the end of the period	1 395	1 932	1 395	1 932

Restricted cash amounts to NOK 216 million (NOK 316 million) and is included in the cash. Changes in restricted cash is reflected in the cash flow. For further information, please see note 10 "Cash and cash equivalents".

Notes to the Accounts

Note 1 General

DOF ASA (the "Company") and its subsidiaries (together, the "Group") own and operate a fleet of PSV, AHTS, subsea vessels and service companies offering services to the subsea market worldwide.

The Company is a public limited company, which is listed on the Oslo Stock Exchange and incorporated and domiciled in Norway. The head office is located at Storebø in the municipality of Austevoll, Norway.

These condensed interim financial statements were approved for issue on 20 February 2020. These condensed interim financial statements have not been audited.

Basis of preparation

This Financial Report has been prepared in accordance with IAS 34, 'Interim financial reporting'. The Financial Report does not include all the information and disclosure required in the annual financial statements, and should be read in conjunction with the Group's Annual Report for 2018.

The Financial Report are prepared on the assumption of a going concern. However, the Group's financial situation is a risk as a long-term financing solution is not in place. The Board of Directors and Management are working on a long-term financial solution for the Group. The discussion with the relevant stakeholders has been constructive, but time consuming. However, no assurance can be given that the Group will be successful in this respect. If the negotiations are not successful this may affect the 'Going concern' assumption. If the Group cannot be treated as going concern, the valuation of the Group's assets will be further revised.

Estimates

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

In preparing these condensed interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 December 2018, with the exception of changes in estimates that are required in determining the provision for income taxes.

Adoption of new standards from 1 January 2019

IFRS 16 Leases

IFRS 16 Leases has replaced the standard IAS 17 Leases and related interpretations. IFRS 16 Leases removes the current distinction between operating and financing leases for lessees and requires recognition of an asset (the right to use the leased item) and a financial liability representing its obligation to make lease payments. Lease payments are reflected as interest expense and a reduction of lease liabilities.

The Group has adopted the standard at its mandatory date 1 January 2019. The Group applied the simplified transition approach and comparative amounts for the year prior to first adoption are not restated.

Reference is made to note 2 'Accounting policies' and note 36 'Adoption of new standard as from 01.01.2019 - IFRS 16 Leases' in the Groups annual report for 2018 for a detailed description of policy- and transition choices made upon the implementation of the standard. There have been no changes to these elements.

Please see note 14 for more information.

The reporting below is presented according to internal management reporting, based on the proportional consolidation method of accounting of jointly controlled companies. The bridge between the management reporting and the figures reported in the financial statement is presented below.

RESULT		4th Quarter 2019		4th Quarter 2018
		Reconciliation		Reconciliation
(MNOK)	Management reporting	to equity method	Financial reporting	Management reporting	to equity method	Financial reporting
Operating income	1 979	-356	1 624	1 704	-234	1 471
Operating expenses	-1 199	89	-1 110	-1 214	46	-1 168
Net profit from associated and joint ventures	-32	37	5	2	68	70
Net gain on sale of tangible assets	-	-	-	-	-	-
Operating profit before depreciation and impairment - EBITDA	749	-230	519	493	-120	373
Depreciation	-323	61	-263	-339	60	-278
Impairment	-328	115	-213	-340	8	-332
Operating profit - EBIT	98	-54	44	-186	-51	-237
Financial income	-	10	10	25	42	67
Financial costs	-321	67	-255	-307	53	-255
Net realised gain/loss on currencies	-10	4	-6	-130	3	-127
Net unrealised gain/loss on currencies	-134	-22	-156	-115	17	-98
Net changes in fair value of financial instruments	81	-	81	-114	-	-114
Net financial costs	-384	60	-325	-641	114	-527
Profit (loss) before taxes	-287	5	-281	-827	63	-764
Taxes	-226	-5	-231	53	-63	-10
Profit (loss)	-512	-	-512	-774	-	-774

RESULT		2019		2018
		Reconciliation		Reconciliation
(MNOK)	Management reporting	to equity method	Financial reporting	Management reporting	to equity method	Financial reporting
Operating income	7 524	-1 248	6 276	6 938	-887	6 051
Operating expenses	-4 808	291	-4 517	-4 868	168	-4 700
Net profit from associated and joint ventures	-47	99	52	-5	282	277
Net gain on sale of tangible assets	4	-	4	2	-	2
Operating profit before depreciation and impairment - EBITDA	2 673	-858	1 815	2 066	-437	1 629
Depreciation	-1 314	242	-1 071	-1 240	177	-1 063
Impairment	-1 449	319	-1 130	-737	46	-691
Operating profit - EBIT	-90	-296	-387	89	-214	-125
Financial income	42	54	97	51	70	121
Financial costs	-1 273	249	-1 024	-1 099	174	-925
Net realised gain/loss on currencies	-255	18	-237	-352	12	-341
Net unrealised gain/loss on currencies	-880	18	-862	-291	3	-288
Net changes in fair value of financial instruments	117	-	117	-2	-	-2
Net financial costs	-2 249	340	-1 909	-1 693	259	-1 435
Profit (loss) before taxes	-2 340	44	-2 296	-1 604	44	-1 560
Taxes	-542	-44	-585	102	-44	57
Profit (loss)	-2 881	-	-2 881	-1 502	-	-1 502

Note 2 Management reporting (continued)

BALANCE		31.12.2019		31.12.2018
(MNOK)	Management reporting	Reconciliation to equity method	Financial reporting	Management reporting	Reconciliation to equity method	Financial reporting
ASSETS
Tangible assets	24 303	-6 537	17 765	25 074	-6 175	18 898
Goodwill	85	-	85	295	-	295
Deferred taxes	200	-187	13	1 006	-108	898
Investment in associated companies and joint ventures	45	1 754	1 799	89	1 458	1 547
Other non-current financial assets	263	348	611	109	1 069	1 177
Total non-current assets	24 896	-4 623	20 273	26 572	-3 757	22 815
Receivables	1 761	35	1 795	1 851	-134	1 718
Cash and cash equivalents	1 715	-320	1 395	2 240	-308	1 932
Total current assets	3 475	-285	3 190	4 091	-441	3 650
Total assets	28 371	-4 908	23 464	30 663	-4 198	26 465
EQUITY AND LIABILITIES
Equity	3 451	-	3 451	5 778	-	5 778
Non-current liabilities	18 201	-4 507	13 694	19 406	-3 828	15 578
Current liabilities	6 719	-401	6 318	5 479	-370	5 110
Total liabilities	24 920	-4 908	20 013	24 885	-4 198	20 687
Total equity and liabilities	28 371	-4 908	23 464	30 663	-4 198	26 465

Note 3 Segment information - management reporting

	Q4 2019			2019
	PSV	AHTS	Subsea	Q4 2019	PSV	AHTS	Subsea	Total
Operating income	140	294	1 545	1 979	516	1 226	5 782	7 524
Operating result before depreciation and impairment - EBITDA	39	129	581	749	113	578	1 982	2 673
Depreciation	34	83	206	323	130	350	834	1 314
Impairment	60	63	205	328	92	339	1 018	1 449
Operation result - EBIT	-55	-17	170	98	-109	-110	129	-90

	Q4 2018			2018
	PSV	AHTS	Subsea	Q4 2019	PSV	AHTS	Subsea	Total
Operating income	112	304	1 289	1 704	582	1 228	5 127	6 938
Operating result before depreciation and impairment - EBITDA	23	119	351	493	91	498	1 477	2 066
Depreciation	31	88	220	339	125	354	762	1 240
Impairment	76	93	170	340	189	143	405	737
Operation result - EBIT	-84	-62	-39	-186	-223	1	311	89

Note 4 Operating income

The Group's operating income streams are a result of the Group's Time Charter contracts and Project Contracts.

Time Charter revenue is based on contracts where the Group deliver a vessel including crew, to a client. The charterer determines, within the contractual limits, how the vessel is to be utilised. A Time Charter contract consists of a bareboat component and a service component. The bareboat period starts from the time the vessel is made available to the customer and expires on the agreed return date. The Bareboat component will normally be within the range 30-80% of the total contract value. The service component covering crew on board the vessel. The service component is within the scope of IFRS 15, while the bareboat component is within the scope of IAS 17/IFRS 16. Both the service and the bareboat are recognised as revenue over the lease period on a straight-line basis. There is no time charter revenue when the vessels are off hire.

Project revenue is based on contracts where the Group utilises its vessels, equipment, crew and the onshore project organisation to perform tailor made service on the client's installations and/or assets. The project revenue is recognised over time.

Both Time Charter contracts and Project contracts are contracts with customers where the Group is compensated based on a fixed day rate for vessel, equipment and personnel. Some of the project contracts will from time to time be lump sum contracts based on a fixed fee for the total service and/or construction delivered.

Operating income	Q4 2019	Q4 2018	2019	2018
Lump sum contracts	136	66	357	125
Day rate contracts	1 488	1 405	5 919	5 926
Total	1 624	1 471	6 276	6 051

Note 5 Hedges

The Group has applied cash flow hedge accounting related to foreign exchange rate risk on expected highly probable income in USD, using a non-derivative financial hedging instrument. This hedging relationship is described below.

Cash flow hedge involving future highly probable income

The Group has applied hedge accounting related to the cash flow hedging of expected highly probable income in USD, from its operations in Brazil.

The cash flow hedges hedge a portion of the foreign currency risk arising from highly probable income in USD relating to time charter contracts on vessels owned by the company Norskan Offshore Ltda.

The hedging instruments are portions of the companies' long term debt denominated in USD. The risk being hedged in each hedging relationship is the spot element of the forward currency rate of USD/BRL. The future highly probable income has a significant exposure to the spot element as the spot element is the main part of the forward rate. The long term debt is translated from USD to BRL at spot rate on the balance sheet date every reporting period.

The effective portion of changes in the fair value of the instruments that are designated and qualify as cash flow hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in the income statement.

Due to several contract renewals in 2020 the cash flow hedge is consider ineffective at 31 December 2019 and a loss is recognised in the finance result with NOK -267 million in Q4 2019 and NOK -817 for the total year 2019. Remaining hedge recognised as other comprehensive income in the equity at 31 December 2019 amounts to NOK -254 mill and will be circulated to the profit or loss over the remaining hedge period.

Note 6 Tangible assets

	Vessel and periodical		Operating	"Right-of-use"
2019	maintenance	ROV	equipment	assets	Total
Book value at 31.12.2018	17 787	707	403		18 898
Implementation of IFRS 16 Leases				353	353
Book value at 01.01.2019	17 787	707	403	353	19 251
Addition	441	109	51	18	619
Reclassification		7	-8		-1
Depreciation	-767	-158	-90	-56,2	-1 072
Impairment loss	-874		-20	-27	-921
Currency translation differences	-118		1	4	-113
Book value at 31.12.2019	16 469	665	337	292	17 765
	Vessel and periodical			Operating
2018	maintenance	ROV	Newbuilds	equipment	Total
Book value at 01.01.2018	19 368	844	11	444	20 667
Addition	436	8	5	78	527
Reclassification	6	18	-16	-9	-1

Right-of-use asset

Net booked value of right-of-use assets at 31 December 2019 consists of property with NOK 280 million and operating equipment with NOK 12 million.

Depreciation -795 -157 -112 -1 064 Impairment loss -661 -3 -1 -665 Currency translation differences -559 -3 -3 -565 Book value at 31.12.2018 17 795 707 - 396 18 899

Newbuild

Newbuild balance for 2018 relates to other subsea equipment under construction. For presentation purposes the newbuild balance has been allocated to the related asset group in 2019, this also includes the opening balance of newbuilding that was allocated to ROVs and operating equipments.

Impairment

Impairment indicators are observed and the Group has done impairment testing of vessels, operating equipment and right-of-use assets. Impairment tests are performed in line with accounting principles presented in annual report for 2018. Impairment in the amount of NOK 213 million has been recognised in the 4th quarter of 2019 and NOK 921 million year to date 31 December 2019.

In addition an impairment in the joint ventures of NOK 115 million has been done in 4th quarter 2019 and NOK 319 million year to date 31 December 2019.

Note 7 Goodwill

Goodwill is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable.

Continued challenging market situation has resulted in lower earnings and higher risk in the segments for a longer period and market recovery takes longer than previously assumed. To reflect the challenging market situation and delay in the market recovery, the management has reassessed estimated future cash flows and recognised an impairment of NOK 209 million in 2019.

Balance at 31 December 2019 amounts to NOK 85 million and allocated to the subsea segment.

Note 8 Taxes

Deferred tax asset is recognised on the basis of unused tax losses carried forward and temporary differences to the extent that it is probable that there will be sufficient future earnings available, against which the tax losses carried forward and temporary differences can be utilised.

Continued challenging market situation has resulted in lower earnings and increased risk in some tax jurisdictions. In this context the inherent uncertainty in forecasting, timing of future taxable profits and reversal of temporary differences has increased. As a result, the management has revised its estimates for future taxable profits and has recognised a tax cost of NOK 196 million in Q4 2019. For the total year a tax cost of NOK 959 million has been recognised. NOK 719 million is recognised as tax cost and NOK 240 million is related to cash flow hedge and recognised as other comprehensive income.

At 31 December 2019 the Group has recognised deferred tax asset of NOK 13 million.

Note 9 Investment in associates and joint ventures

The Company's investment in associates and joint ventures as of 31.12.2019;

Joint ventures	Ownership
DOFCON Brasil AS with subsidiaries	50%
DOF Deepwater AS	50%
DOF Iceman AS (owner of 40% in Iceman AS, Skandi Iceman)	50%
Associated companies
Master & Commander	20%
Skandi Aukra AS	34%
Iceman AS (Skandi Iceman)	35%
DOF OSM Services AS	50%
DOF Subsea Ghana Ltd	49%
Effect of application of IFRS 11 on investments in joint ventures;	31.12.2019
Opening balance 01.01.2019	1 547
Addition	2
Profit (loss)	52
Profit (loss) through OCI	66
Negative value on investments reallocated to receivable and liabilities	139
Closing balance 31.12.2019	1 806

Note 10 Cash and cash equivalent

	31.12.2019	31.12.2018
Restricted cash *)	216	316
Cash and cash equivalent	1 179	1 616
Total cash and cash equivalent	1 395	1 932

*) Including restricted cash related to non-current loans from Eksportfinans.

Note 11 Interest bearing liabilities

Covenants regarding non-current liabilities to credit institutions:

DOF ASA

DOF ASA Group shall have a book equity higher than NOK 3,000 million, free cash deposits shall at all times be minimum NOK 250 million excluding DOF Subsea AS (and it's subsidiaries) and market value of the vessels on aggregated level shall at all times be higher than 100% of outstanding secured debt. The minimum free liquidity requirements is waived to NOK 250 million until end of February 2020.

DOF Subsea AS

DOF Subsea has the following covenants (based on proportional consolidation method of accounting for joint ventures); the book equity shall be higher than NOK 3,000 million, minimum free liquidity shall at all times be minimum NOK 500 million, value adjusted equity shall be at least 30% and market value vessels shall at all times be at least 110-130% of outstanding secured debt.

The Group is in compliance with its financial covenants as of 31 December 2019.

Interest bearing liabilities	31.12.2019	31.12.2018
Non-current interest bearing liabilities
Bond loan	2 122	2 480
Debt to credit institutions	11 170	13 007
Lease liabilities (IFRS 16)	370	-
Total non-current interest bearing liabilities	13 662	15 487
Current interest bearing liabilities
Bond loan	467	100
Debt to credit institutions	4 116	3 475
Lease liabilities (IFRS 16)	91
Overdraft facilities	78	59
Total current interest bearing liabilities	4 752	3 534
Total interest bearing liabilities	18 414	19 021
Net interest bearing liabilities
Other interest bearing assets non-current (sublease IFRS 16)	131
Cash and cash equivalents	1 395	1 932
Total net interest bearing liabilities	16 888	17 089
Net effect of IFRS 16 Lease	330
Total net interest bearing liabilities excluded IFRS 16 Lease liabilities	16 558	17 089

Non-current loans provided by Eksportfinans are invested as restricted deposits. The repayment terms of the loans from Eksportfinans are equivalent with the reduction of the deposits. The loans are fully repaid in 2020. The cash deposit is included in restricted deposits.

Current portion of debt to credit institutions amounts to NOK 4,116 million including balloon payments of NOK 1,779 million, ordinary instalments of NOK 1,787 million and drawn credit facilities of NOK 550 million. The credit facilities are non-current and may be redrawn.

Financing

The Board and Management have since 2nd quarter been working on a long-term refinancing solution for the Group which include a discussions with the banks, the bondholders and the main shareholders. In parallel the Group has agreed waivers, including deferral of instalments and amendments of financial covenants until end of February 2020. The negotiations with the banks and bondholders are progressing well, however the discussions have taken longer time than expected. The Board and Management still believes that a long-term solution is achievable within 1st quarter 2020, however no assurance can be given at this time. The effect of not being able to obtain a long-term financial solution will affect the classification of debt and may also affect the ´going concern´ assumption. If the Group cannot be treated as ´going concern´, the valuation of the Group's assets must be further revised.

The effect of not being able to obtain a long-term financial solution, may result in a reclassification of the Group's non-current debt to credit institutions and bond loans from non-current debt to current debt. If a reclassification should occur, the consequence will be that the amount of current debt will increase by NOK 9.7 billion as of 31 December 2019.

Note 11 Interest bearing liabilities (continued)

Instalment- and balloon profile *)	Q1 2020	Q2 2020	Q3 2020	Q4 2020	Total current debt	2021	2022	2023	2024	Subsequent	Total
Bond loan		467			467		1 292	840			2 599
Balloons debt to credit institutions	1 263		516		1 779	2 435	166	756			5 136
Debt to credit institutions	855	651	396	434	2 336	1 213	1 119	1 031	866	3 621	10 184
Overdraft facilities	78				78						78
Total	2 196	1 118	912	434	4 661	3 648	2 577	2 626	866	3 621	17 998

*) Lease debt according to IFRS 16 and amortised costs are excluded in the figures above.

Loan divided on currency and fixed interest	Share fixed interest	Balance 31.12.2019
NOK	64%	8 075
USD	76%	9 443
CAD	100%	383
BRL		97
Total	70%	17 998

Reconciliation changes in borrowings

Changes in total liabilities over a period consists of both cash effects (proceeds and repayments) and non-cash effects (amortisations and currency translations effects). The following are the changes in the Group's borrowings:

			Non-cash changes
Reconciliation changes in liabilities	Balance 31.12.2018	Cash flows	Implementation IFRS 16 Lease	Proceeds lease debt	Amortised loan expenses	Currency adjustments	Balance 31.12.2019
Non-current interest bearing liabilities
Bond loan	2 580				-5	14	2 590
Debt to credit institutions	16 382	-1 339		87	21	134	15 285
Lease liabilities		-84	525	15		5	461
Overdraft facilities	59	20				-1	78
Total interest bearing liabilities	19 021	-1 403	525	102	17	152	18 414

Note 12 Subsequent events

Contracts

DOF Subsea has in January been awarded contracts in Australia and in the North America region and secured utilisation for the Skandi Singapore, Skandi Neptune and the hired in vessel Harvey Deep Sea well into 1st quarter 2020. The 50% owned PLSV Skandi Vitoria has been awarded a contract with TechnipFMC for two years + options. This contract has commenced in January 2020.

In February, DOF Subsea was awarded a 5-year contract + options for Geosea with N-Sea.

Refinancing

A summons for a meeting on 27th of February has been sent to the bondholders in DOFSUB07, DOFSUB08 and DOFSUB09. The summons is based on agreement in the bondholder meeting on 20th of December 2019.

Note 13 Transaction with related parties

Transactions with related parties are governed by market terms and conditions in accordance with the "arm's length principle". The transactions are described in the Annual report for 2018.

There are no major changes in the type of transactions between related parties.

Note 14 Adoption of IFRS 16 Lease from 1 January 2019

The implementation of the IFRS 16 has increased the financial position with lease liabilities, net investments and right-of-use assets. The Groups equity has not been impacted by the implementation of IFRS 16. The following line items in the financial report have been impacted as result of the new accounting standard.

		Implementation IFRS 16
CONSOLIDATED STATEMENT OF BALANCE SHEET	31.12.2018	Leases	01.01.2019
Tangible assets	18 898	353	19 251
Other non-current assets	3 917	172	4 089
Total non-current assets	22 815	525	23 340
Total current assets	3 650		3 650
Total assets	26 465	525	26 990
Total equity	5 778		5 778
Non-current liabilities	15 578	441	16 019
Current liabilities	5 110	84	5 194
Total liabilities	20 687	525	21 212
Total equity and liabilities	26 465	525	26 990

	Q4 2019			2019
	excluding	Effect of		excluding	Effect of
CONSOLIDATED STATEMENT OF PROFIT OR LOSS	IFRS 16	IFRS 16	Q4 2019	IFRS 16	IFRS 16	2019
Operating revenue	1 636	-12	1 624	6 324	-48	6 276
Operating expenses	-1 137	28	-1 110	-4 626	109	-4 517
Share of net income from associates and joint ventures	5		5	52		52
Profit from sale of tangible assets	-		-	4		4
Operating result before depreciation and impairment (EBITDA)	503	16	519	1 754	61	1 815
Depreciation	-248	-14	-263	-1 016	-56	-1 071
Impairment	-213	-	-213	-1 130	-	-1 130
Operating result (EBIT)	42	1	44	-391	5	-387
Financial income	9	2	10	90	7	97
Financial costs	-249	-6	-255	-1 000	-24	-1 024
Net realised gain/loss on currencies	-6		-6	-237		-237
Net unrealised gain/loss on currencies	-154	-2	-156	-862	-	-862
Net changes in fair value of financial instruments	81		81	117		117
Net financial costs	-319	-6	-325	-1 893	-17	-1 909
Profit (loss) before taxes	-277	-5	-281	-2 284	-12	-2 296
Taxes	-231		-231	-585		-585
Profit (loss) for the period	-507	-5	-512	-2 870	-12	-2 881

The table below presents a reconciliation of the Groups operating lease liabilities as reported under IAS 17 Leases per 31 December 2018 and the IFRS 16 lease liability recognised on 1 January 2019.

RECONCILIATION OF LEASE COMMITMENTS TO LEASE LIABILITIES	01.01.2019
Operating lease commitments (IAS 17) at 31 December 2018	678
Practical expendient related to short-term and low-value leases	-72
Effect of discounting	-93
Escalation and amendments to lease agreements	12
Lease liabilities recognised at initial application	525

Note 15 Share capital and shareholders

Largest shareholders as of 31.12.2019

Name	No. shares	Shareholding %
MØGSTER MOHN OFFSHORE AS	150 638 643	48.95
BNP PARIBAS SECURITIES SERVICES	9 570 169	3.11
FOLKETRYGDFONDET	6 100 000	1.98
NORDNET BANK AB	2 610 818	0.85
DRAGESUND INVEST AS	2 360 000	0.77
JIM ØYSTEIN HOLDEN	2 004 885	0.65
RBC INVESTOR SERVICES BANK S.A.	2 000 000	0.65
MOCO AS	1 984 419	0.64
AS NAVE	1 832 338	0.60
BERGEN KOMMUNALE PENSJONSKASSE	1 800 000	0.58
SKANDINAVISKA ENSKILDA BANKEN AB	1 612 201	0.52
STATE STREET BANK AND TRUST COMP	1 605 497	0.52
STAVERN HELSE OG FORVALTNING AS	1 500 000	0.49
DP HOLDING AS	1 262 500	0.41
LAWO INVEST AS	1 173 377	0.38
CITIBANK, N.A.	1 053 396	0.34
AKERSHUS INTERKOMMUNALE	1 000 000	0.32
SOURCE INVEST AS	1 000 000	0.32
EBB HOLDING AS	949 097	0.31
SIGFISK AS	850 000	0.28
Total	192 907 340	62.68
Total other shareholders	114 855 439	37.32
Total no of shares	307 762 779	100.00

Note 16 Performance measurements definitions

DOF ASA financial information is prepared in accordance with international financial reporting standards (IFRS). In addition DOF ASA discloses alternative performance measures as a supplement to the financial statement prepared in accordance with IFRS. Such performance measures are used to provide an enhanced insight into the operating performance, financing and future prospects of the company and are frequently used by securities analysts, investors and other interested parties.

The definitions of these measures are as follows:

Financial reporting – Financial Reporting according to IFRS.

Management reporting – Investments in joint ventures (JV) is consolidated on gross basis in the income statement and the statement of financial position.

EBITDA – Operating profit (earnings) before depreciation, impairment, amortisation, net financial costs and taxes is a key financial parameter. The term is useful for assessing the profitability of its operations, as it is based on variable costs and excludes depreciation, impairment and amortise costs related to investments. Ebitda is also important in evaluating performance relative to competitors.

EBITDA before hedge – Ebitda as described above adjusted for hedge accounting of revenue, according to management reporting.

Operational EBITDA – Ebitda as described above adjusted for gain on sale of tangible assets, according to management reporting.

Operational EBITDA before hedge – Ebitda as describe above adjusted for gain on sale of tangible assets and hedge accounting of revenue, according to management reporting.

EBIT – Operating profit (earnings) before net financial costs and taxes.

Profit before unrealised finance costs – Profit before net unrealised gain/loss on currencies and net changes in the fair value of financial instruments.

Unrealised finance costs – Total unrealised gain/loss on currencies and net changes in the fair value of financial instruments.

Unemployed capital – Vessel under construction (newbuildings).

Interest bearing debt – Total of current and non-current borrowings.

Net interest bearing debt – Interest bearing debt minus current and non-current interest-bearing receivables and cash and cash equivalents. The use of the term "net debt" does not necessarily mean cash included in the calculation are available to settle debts if included in the term.

Debt ratio – Net interest bearing debt divided on total equity and debt.

Utilisation – Utilisation of vessel numbers is based on actual available days including days at yard for periodical maintenance, upgrading, transit or idle time between contracts.

Contract coverage – Number of future sold days compared with total actual available days excluded options.

Contract Backlog – Sum of undiscounted revenue related to secured contracts in the future and optional contract extensions as determined by the client. Contract coverage related to master service agreements (MSA`s) within the CSV segment, includes only confirmed purchase order.

DOF ASA

Alfabygget 5392 Storebø NORWAY

Phone: +47 56 18 10 00 Fax: +47 56 18 10 06 management@dof.com

Norway

DOF Subsea AS Thormøhlensgate 53 C 5006 Bergen NORWAY Phone: +47 55 25 22 00 Fax: +47 55 25 22 01

DOF Subsea Norway AS

Thormøhlensgate 53 C 5006 Bergen NORWAY Phone: +47 55 25 22 00 Fax: +47 55 25 22 01

DOF Management AS

Alfabygget 5392 Storebø NORWAY Phone: +47 56 18 10 00 Fax: +47 56 18 10 06 management@dof.com

Angola

DOF Subsea Angola

Belas Business Park-Talatona Edificio Bengo, 1º Andar Sala 106/107, Luanda REPUBLIC OF ANGOLA Phone: +244 222 43 28 58 Fax: +244 222 44 40 68 Mobile: +244 227 28 00 96 +244 277 28 00 95

Argentina

DOF Management Argentina S.A. Peron 315, piso 1, Oficina 6-b 1038 - Buenos Aires ARGENTINA

Phone: +54 11 4342 4622 fgarcia@seaworks.com.ar

Australia

DOF Subsea Australia Pty Ltd

5th Floor, 181 St. Georges Tce Perth WA 6000 AUSTRALIA Phone +61 8 9278 8700 Fax: +61 8 9278 8799

DOF Management Australia

5th Floor, 181 St. Georges Tce Perth WA 6000 AUSTRALIA Phone: +61 3 9556 5478

Mobile:+61 418 430 939 management@dof.com

Brazil

NorSkan Offshore Ltda

Rua Lauro Muller 116, 17 andar Torre do Rio Sul - Botafogo Rio de Janeiro, R.J. BRAZIL - CEP: 22290-160 Phone: +55 21 21 03 57 00 Fax: +55 21 21 03 57 17 office@norskan.com.br

DOF Subsea Brasil Serviços Ltda

Rua Fiscal Juca, 330 Q: W2 – L: 0001 Loteamento Novo Cavaleiros Vale Encantado – Macaé/RJ BRAZIL - CEP 27933-450 Phone: +55 22 21 23 01 00 Fax: +55 22 21 23 01 99

Canada

DOF Subsea Canada

26 Allston Street Mount Pearl, Newfoundland CANADA, A1N 0A4 Phone: +1 709 576 2033 Fax: +1 709 576 2500

Singapore

DOF Management Pte Ltd

25 Loyang Crescent Block 302 TOPS Avenue 3 #01-11 SINGAPORE 508988 Phone: +65 6868 1001 Fax: +65 6561 2431 management@dof.com

DOF Subsea Asia Pacific Pte Ltd

25 Loyang Crescent Block 302 TOPS Avenue 1 #01-11 SINGAPORE 508988 Phone: +65 6561 2780 Fax: +65 6561 2431

UK

DOF (UK) Ltd

Horizons House, 81-83 Waterloo Quay Aberdeen, AB11 5DE UNITED KINGDOM

Phone: +44 1224 586 644 Fax: +44 1224 586 555 info@dofman.co.uk

DOF Subsea UK Ltd

Horizons House 81-83 Waterloo Quay Aberdeen, AB11 5DE UNITED KINGDOM Phone: +44 1224 614 000 Fax: +44 1224 614 001

USA

DOF Subsea USA Inc

5365 W. Sam Houston Parkway N Suite 400 Houston, Texas 77041 USA Phone: +1 713 896 2500 Fax: +1 713 726 5800

DOF ASA

Alfabygget 5392 Storebø NORWAY

www.dof.com