Nekkar — Investor Presentation 2016

May 11, 2016

Q1 Results 2016

11th of May 2016 Toril Eidesvik, CEO Henrik Solberg-Johansen, CFO

Introduction new CEO – Toril Eidesvik

• Master of laws / master programs in economy and project management
• More than 20 years experience from the shipping industry
• CEO in the stock listed companies Green Reefers ASA and EMS Seven Seas ASA
• Substantial board experience from a number of companies within the shipping and offshore industry
• Board member and chairman in the audit committee in TTS from 2013

2

Agenda

• 1 st quarter headlines and market outlook
• 1 st quarter consolidated accounts
• Segment info
• Shareholder structure
• Summary

1 st quarter 2016 - headlines

• Improved consolidated performance Q1 2016 vs Q1 2015
• Turnover MNOK 766 (593)
• Order intake MNOK 529 (301)
• EBITDA MNOK 26 (1)
• Cashflow from operations 100% owned companies +MNOK 60
• Substantial orders for shiplift (MNOK 100) and hatch covers (MNOK 94) announced in April
• Orderbook BNOK 3.6, of which BNOK 2 for 2016 delivery
• Significant Offshore improvement, Q1 2016 EBITDA positive
• Strategy unchanged. Improvement program continues

4

Ship-type focus organization

Current TTS product portfolio (2015 turnover and EBITDA) Product expansion opportunities

RoRo/Cruise/Navy	Container/Bulk/ Tank	Multipurpose/ General Cargo	Shipyard Solutions	Services	Offshore
Turnover: NOK 641m EBITDA: NOK 62m Cargo handling solutions for ‒Car carriers ‒Cruise ships	Turnover: NOK 973m EBITDA: NOK 141m Cargo handling solutions incl. winches, cranes and hatch covers for	Turnover: NOK 259m EBITDA: NOK -13m Heavy lift cranes, mooring winches, hatch covers and side loading systems for	Turnover: NOK216m EBITDA: NOK 18m Production lines and systems for ‒Shipyards cargo handling	Turnover: NOK 591m EBITDA: NOK 76m Complete services within maintenance, spare parts	Turnover: NOK 359m EBITDA: NOK -102m Offshore cranes for offshore vessels offshore installations
‒Specialized vessels ‒Port handling equipment Cruise (davits, tenders, gangways, winches, new innovations) Navy (hangar doors, turntables, cranes, hatch covers)	‒Container ships ‒Bulk carriers ‒Tankers Cargo control systems Lashing bridges Lashing gears Lifeboats Rudders and Steering Gears	‒Multipurpose vessels ‒Cargo ships E-cranes Increased leg encircling crane portfolio Increased lattice boom crane portfolio Cargo control systems	‒Transfer systems for docking and launching. Green scrapping Redesign STRI + TTS existing products	interval agreements life time services Increased # spare parts hubs Increased # servicing hubs	Increased AHC crane size range ROV handling systems Skidding systems Moon Pool HC Elevator System Hangar and ROV side Doors

Key advantages of the ship type focus

• Key account 20% of ship owners owns 80% of the global fleet
• One face to the market
• More value per sale, packaged deliveries
• Broader service offering per ship type -> Leading to TTS as total service provider

Product platform to support life time services - > TTS a total Service provider

High visibility on 2Q-4Q 2016 revenue

Order backlog for delivery 2016 – TTS Group excl. Offshore

• Bulk market depressed except for upside in mega-size tonnage

• Car carriers market softer, but stronger focus on Ropax and liner RoRo
• Mega container saturating. Shift to feeder +4000 TEU
• High activity on cruise building in Europe and China
• High expectation on near shore work boat heavy lift
• Tank and Gas peak ended
• Increased risk of cancellations for bulk. Indications of increased postponement risk for car carriers

Heading towards 2016 financial projection

• Revenues for TTS Group excluding Offshore expected to grow to NOK 3,0-3,2 bn in 2016
• EBITDA margin for TTS Group excluded Offshore expected to reach 4-6%, in line with 2015. 2016 earnings profile expected to be back-loaded
• TTS expect a modest growth in revenues for the Group excluding Offshore into 2017 with ambition for margins to approach industry average levels
• Offshore excluded as the offshore market is expected to remain weak. However TTS exposure considerably reduced.

Key financials - TTS Group excluding Offshore

Agenda

• 1 st quarter headlines and market outlook
• 1 st quarter consolidated accounts
• Segment info
• Shareholder structure
• Summary

Profit and loss statement

	1st quarter			Full year
MNOK	2016	2015	2015	2014	2013
Turnover	766	593	3 051	2 454	2 693
EBITDA	2 6	1	155	105	-130
Operating profit	1 1	-8	3 2	6 1	-164
Net financial items	-1	-15	-47	1	-37
Profit/loss before tax	1 0	-23	-15	6 3	-201
Net result continued business	0	-28	-40	-22	-227
Net result incl discontinued business	0	-28	-40	1 8	-204
of which attributable to equity holders	-2	-28	-49	1 8	-204
of which attributable to non-controlling interest	2	-	9	-

Order intake and order backlog

Order intake per quarter 2013-2016 including 100 % of JV*)

Book to bill = Order intake / Revenues

Divided per year of delivery * ) From 2Q2015 THH is consolidated into Group. Order intake 2013-1Q2015: THH + TBH; from 2Q2015: TBH only

Order backlog per 31.03.2016 is MNOK 3886 including 100 % of JV company

Turnover and EBITDA development

Note: - EBITDA Q4 2014 of MNOK 36 is excl. positive pension effect of MNOK 101, of total EBITDA MNOK 137

• EBITDA Q2 2015 of MNOK 34 is excl. one off THH adjustment effects of MNOK 104, of total EBITDA MNOK 138

• EBITDA Q3 2015 of MNOK 8 is excl. one off Offshore inventory write down of MNOK 20, of total EBITDA MNOK-12

• EBITDA Q4 2015 of MNOK 47 is excl. negative effect from Offshore restructuring cost of MNOK 18, of total EBITDA 29

Marine segments positive with potential for further improvement

Balance sheet

MNOK	31.03.2016	31.03.2015	31.12.2015
Non-current assets	1072	916	1 106
Current assets	1806	1642	1 920
TOTAL ASSETS	2878	2558	3 025
Equity	836	584	855
Gross interest bearing liabilities	471	404	523
Other liabilities and provisions	1571	1570	1 647
TOTAL EQUITY AND LIABILITIES	2878	2558	3 025

Net interest bearing debt / Covenants:	Equity, of which:
 Net interest bearing debt increased to MNOK 172, increase mainly in 50% owned subsidiaries
 Total consolidated cash MNOK 298 per 31.03.2016, of which MNOK 246 is in 50% owned subsidiaries
 Unutilized credit facilities MNOK 128
 Group equity ratio including subordinated convertible debt is 32,3 % at the end of Q1 2016
 Covenants at Q1 2016 are met

Equity, of which:
	31.03.2016	31.12.2015
Equity holders	632	635
Non-controlling interest	204	220
Total	836	855

Cash flow / Working capital / Interest bearing debt

Cash flow			Year
MNOK Net cash flow from operations	1Q16 -31	1Q15 -74	2015 0
Net cash flow from investme0nts	-2	-1	196
Net cash flow from financial activities	-64	-7	69
Net change in cash	-97	-82	265
Cash and bank deposits at the start of the period	413	131	131
Effect of exchange rate changes in bank/cash	-18	3	17
Cash and bank deposits at the end of the period	298	52	413

Net interest bearing debt

MNOK	Q1/16	Q4/15	Q3/15	Q2/15	Q1/15	Q4/14	Q3/14	Q2/14
Short term interest b. debt	375		427 384 417		314	297	273	295
Long term int.bearing debt	0	0	0	0	0	1	1	1
Convertible bond (*)	95	95	95	95	95	95	95	95
Total	470		522 479 512		409	393	369	391
Cash	298		414 349 331		52	131	88	88
NIBD (**)	172	108	130	181	357	262	281	303
* Convertible loan included at nominal value (**) Negative indicates net asset position

RoRo / Cruise / Navy

Cargo handling solutions for car carriers, cruise ships and specialized vessels as well as port handling equipment.

		Q1 Periodic
MNOK	2016	2015	2015
Turnover	143	160	641
EBITDA	10	15	62
Order backlog	925	706	941

• Strong position in a PCTC-market passing its peak, but with higher activity for Ropax and RoRo
• Increased activity within the cruise sector
• Solid order book based on proven solutions, and repeat orders from key customers within the RoRo market gives basis for expected high activity through 2016

Container / Bulk / Tank

Cargo handling solutions for container ships, tankers and bulk carriers; including winches, cranes and hatch covers.

		Q1 Periodic
MNOK	2016	2015	2015
Turnover	270	72	973
EBITDA **	4	2	141
Order backlog *)	1 825	1 601	2 090

(*) Includes 50% of order backlog in equity consolidated investments in China

• Increased demand for capsize-plus bulk, but medium sized bulk remains challenging
• Saturation of market for mega container ships replaced by container feeder vessels
• Good tanker new build activity
• South Korea regains market position in merchant shipbuilding at the cost of heavy price pressure

Offshore

Cranes for offshore vessels and offshore installations.

		Q1 Periodic
MNOK	2016	2015	2015
Turnover	70	79	359
EBITDA	5	-24	-102
Order backlog	186	230	219

• Capacity adjustments continue through 2016 to adapt cost to order book
• Risk and exposure at a controllable level in a harsh offshore market

Multipurpose / General Cargo

Heavy lift cranes, mooring winches, hatch covers and side loading systems for multipurpose vessels and cargo ships.

		Q1 Periodic
MNOK	2016	2015	2015
Turnover	71	94	259
EBITDA	-5	-4	-13
Order backlog	509	445	573

• 1Q2016 activity slightly behind 1Q2015 due to delays in some projects
• Based on the order backlog, activity is expected to pick up through the remaining quarters of 2016
• Market potential promising, both for multi purpose heavy lift and for heavy lift installation vessels

Shipyard Solutions

Production lines and systems for cargo handling to shipyards, focusing on transfer systems for docking and launching.

	Q1 Periodic	Full Year
MNOK	2016	2015	2015
Turnover	69	51	216
EBITDA	7	4	17
Order backlog	184	265	204

Stable activity and acceptable margins

• Promising market prospects for ship-lifts and other shipyard systems, where TTS has a strong market position
• New shiplift order (MNOK 100) announced in April
• TTS Liftec delivering positive results, adapting to a market with increased competition

Services

Complete services within maintenance, including spare parts, interval agreements and life time service.

		Q1 Periodic
MNOK	2016	2015	2015
Turnover	138	136	591
EBITDA *	13	13	76

• 1Q 2016 turnover and EBITDA on level with the same quarter last year
• Current installed base of approximately 23 000 units of equipment on approximately 8000 vessels is a good basis for further services business development

Shareholder structure at May 10th 2016

Skeie Technology AS	26,16 %
Rasmussengruppen AS	13,29 %
Skeie Capital Invest	4,85 %
Holberg Norge	4,34 %
Barrus Capital AS	4,00 %
Skagen Vekst	3,51 %
Pima AS	2,78 %
Cipi Lamp Ucits	2,58 %
Mertoun Capital AS	2,04 %
Pharos Sicav	1,92 %
10 largest shareholders	65,47 %
Other	34,53 %
Total	100,00 %

Skeie Technology AS, Skeie Capital Investment AS and members of the Skeie family hold in total 32,02%.

22

Agenda

• 1 st quarter headlines and market outlook
• 1 st quarter consolidated accounts
• Segment info
• Shareholder structure

• Summary

• Strong order book covering >90% of remaining 2016 new build activity prognosis

• Positive quarter EBITDA and net earnings
• Operational improvement processes on track
• Positive view on significant market segments
• Offshore market expected to remain slow
• Process initiated in February 2015 to explore strategic opportunities is still ongoing