Solstad Offshore ASA — Interim / Quarterly Report 2021

Nov 25, 2021

3th Quarter Report 2021

The Contents

fro C O Le t ter t he E m	0 4
H ig h l ig hts	0 6
F ina ia l Su nc mm ary	0 8
Op ion l Up da t te era a	1 4
Ou Ma ke t t loo k r	1 6
Su ta ina b i l ity s	1 8
S ta tm t o f t he Bo d en ar	2 0
F ina ia l S ta tem t nc en	2 2
No tes	3 0
Ou G lo ba l Fo tp int r o r	4 0

The Company

Solstad Group ("the Company") is a world leading owner and operator of offshore service vessels.

As per September 2021 the Company have 3 600 highly skilled employees with 9 offi ces globally and operate a versatile fl eet of modern offshore vessels.

Solstad has a clear vision of what lies ahead, and it starts with taking care of our most precious recourses, our people and our planet, while sustaining growth and profi tability.

Frontpage photo: Thomas Olsson

Letter from the CEO

The 3rd quarter marks another step in the right direction for Solstad Offshore. Historically, the 3rd quarter is our most active quarter and this is true also this year. EBITDA came in at Nok 500 mill and is equal to the best quarter we have had since the 4-company merger in 2016/17.

Our markets continue to show positive signs and we are entering the winter season with the highest contract coverage in many years.

The quarter has also seen strategic advancements as we took steps to strengthen our position within the renewable energy sector. The Windstaller Alliance established jointly with the internationally recognized companies Deepocean and Aker Solutions allows us to combine extensive competence and resources to create value for our renewable energy clients. Collaboration will be one of the key elements to drive down the cost in the renewables sector, make renewable energy competitive with other energy sources, and ultimately reduce emissions from energy production and consumption.

The initiative has been well received by our clients and I am looking forward with great expectations to what the Windstaller Alliance can achieve in the years to come.

I am from time to time being asked about our activity within oil & gas compared to our activity in offshore wind and where we are heading.

We are and will continue to support all energy production offshore, covering current, emerging and future energy production. My ambition for the company is that we are a relevant and attractive partner to all developers of offshore energy, ranging from oil and gas to offshore wind and future energy sources such as tidal and wave energy. We work hard every day to ensure that our maritime competence and vessels are up the standards expected by our customers across the offshore energy industry.

That includes a continuous focus on reducing emissions from our operations. Solstad Green Operations is a fuel saving program that has yielded signifi cant positive impact since it was implemented in 2009. Batteries and shore power connection are known technologies we are using in our fl eet today, and we are constantly keeping an eye on what is next. We are participating in several promising pilot projects that look at new fuel types and other technologies.

On 17th November we received the 2021 OSJ Environmental Award as a recognition to what Solstad is doing to reduce emissions. I am very proud of this award, and it shows that all the hard work being done onshore and offshore in the company is being noticed.

In addition to upgrading our fl eet, we continue to sell the oldest part of the fl eet.

24 vessels are sold YTD, including 8 vessels for recycling at Green Yards Norway.

Thank you.

Lars Peder Solstad CEO

Highlights

• Revenues for the third quarter of 2021 was MNOK 1,500 vs MNOK 1,316 in 2020, while EBITDA adjusted for the third quarter was MNOK 500 vs MNOK 395 in 2020
• High order intake in 3Q 2021, approx. MNOK 2,000
• The offshore activity continues to gradually improve both within oil & gas and offshore-wind and new contracts have been signed at improved terms
• Of the company's core fl eet, 81 of 90 vessels has been working during the quarter
• Sold 24 of 37 vessels classifi ed as non-strategic in 2021
• The Company is continuously working on upgrading its fl eet to battery-hybrid to meet its sustainability targets for 2021
• Together with our partners in Aker Solutions and DeepOcean Windstaller Alliance was launched 14 October 2021. Windstaller Alliance will strengthen Solstads presence further within offshore wind.

Key Financials

(NO ) K 1, 000 ,000	202 1 01.0 7-30 .09	202 0 01.0 7-30 .09	202 1 01.0 1-30 .09	202 0 01.0 1-30 .09	202 0 01.0 1-31 .12	201 9 01.0 1-31 .12	201 8 01.0 1-31 .12
Rev enu e	1,50 0	1,31 6	4,10 1	3,85 1	5,02 6	5,24 5	4,91 0
EBIT DA adju sted	500	395	1,24 1	1,08 9	1,28 2	1,41 5	1,00 5
EBIT	152	-823	135	-1,9 55	-2,2 50	-1,19 6	-3,9 87
Profi t be fore Tax	-144	-1,14 4	-712	-4,1 86	7,25 0	-3,1 29	-5,8 88
Cas h an d eq uiva lent s	2,34 3	1,05 4	2,34 3	1,05 4	2,41 2	1,13 4	1,35 1
Net king ital wor cap	-325	-27, 652	-325	-27, 652	-803	-26, 264	-24, 654
Equ ity	3,41 4	-8,0 12	3,41 4	-8,0 12	4,24 3	-3,8 35	-851
Net inte bea ring deb t* rest	19,4 40	31,3 92	19,4 40	31,3 92	19,3 65	30,9 90	28,7 27
Ord er b ack log	5,00 0	6,10 0	5,00 0	6,10 0	5,23 6	8,20 0	6,80 0

*Including recognized debt relating to IFRS 16 Leases (Note 9)

Financial Summary

Operating income for 3Q 2021 amounted to MNOK 1,500 compared to MNOK 1,316 in 3Q 2020.

• The main driver for the increased revenue is more vessels in operation, higher day rates and better utilization of the total fl eet.
• Operating expenses in 3Q 2021 amounted to MNOK 1,025 of which MNOK 949 are classified as vessel operating expenses. Compared to 3Q 2020, operating expenses increased by MNOK 76 including an extraordinary one-off restructuring cost of MNOK 7.
• Administrative expenses for 3Q 2021 was MNOK 97 (MNOK 90 Adjusted for restructuring cost), compared to MNOK 82 for 3Q 2020.
• Adjusted for the increased numbers of active vessels and extraordinary COVID-19 cost the operational expenses are in line with previous year.
• Additional cost related to the COVID-19 pandemic amounted to approximately MNOK 30 in the quarter.
• Operating result before depreciation was MNOK 475 in 3Q 2021 compared to MNOK 367 in 3Q 2020.
• Ordinary result before taxes for 3Q 2021 was negative with MNOK 144 compared to negative MNOK 1,144 for 3Q 2020.
• EBITDA adjusted was MNOK 500 in 3Q 2021 compared to MNOK 395 for 3Q 2020. The main driver for the increased revenue is more vessels in operation, higher day rates and better utilization of the total fl eet.
• Total liquidity for the group was MNOK 2,343 per 3Q 2021 compared to MNOK 1,054 in 3Q 2020
• Total booked equity at the end of the quarter was positive MNOK 3,414

During 3Q 2021 the currency exchange rate for USD versus NOK has been weakening resulting in an loss of MNOK 90. In addition, the Company

has realized currency gain of MNOK 9 relating to account payable and receivable positions being settled.

Capital Structure

Total current assets at the end of the quarter were MNOK 3,983 (MNOK 2,845 per 3Q 2020), of which cash and cash equivalents amounted to MNOK 2,343 (MNOK 1,054). This includes the unutilized super senior credit facility of MNOK 1,481.

Total current liabilities were NOK 4,307 (MNOK 30,497) including MNOK 3,271 in short term portion of long-term debt, giving net working capital of MNOK -325 (MNOK -27,652). Of the short term portion of the long-term debt Normand Maximus lease liability amounts to MNOK 2,463.

Total non-current assets at the end of the quarter were MNOK 21,361 (MNOK 23,779). The reduction is explained by ordinary depreciation, divestments and foreign exchange movements.

Net interest-bearing debt was at MNOK -19,440 (MNOK -31,392), with the reduction mainly explained by restructuring effects.

The Group's equity as of 30 September 2021 was MNOK 3,414 (MNOK -8,012), which represents 13,4% of the total balance sheet (-30,1% per 30 September 2020).

Cash Flow & Cash Position

The overall cash position end of 3Q 2021 for the Company was MNOK 2,343 compared to MNOK 1,054 in 3Q 2020. The Net cash flow from operations was positive with MNOK 890 for 3Q 21. Net cash flow from investments was negative by MNOK 101 mainly related to planned maintenance and regulatory docking- and installation of battery hybrid system on vessels. Net interest paid to lenders was MNOK 394, and net repayment of long-term debt to lenders were MNOK 176. o planned batte MNOK NOK

Risk

The Company is exposed to market, commercial, operational and financial risks that affect the assets, liabilities, available liquidity and future cash flows. Despite of the difficult market situation within the offshore industry the last years, the Company considers that these risks have decreased slightly as a consequence of the increased demand compared to previous years. There is established a risk mitigation framework based on identifying, assessing and managing the Company risks. The Board monitors the overall risk factors for the Group.

Market and operational risks are changes in demand for and prices of the services provided by the Company, and potential adverse effects of the provision of such services. The market has been under pressure with the impact of COVID-19 virus and affecting all regions where the Group operates. This has negatively impacted the earnings of the Group's fleet. A slower recovery of the market will impact future earnings of the Group's fleet going forward. The Company has implemented a wide range of measures to minimize the risk to people and operations from the COVID-19 pandemic. A large part of the Company staff has been vaccinated and the Company continue to practice social distancing, travel restrictions, testing of marine crew and partly working from home. The company has so far avoided significant COVID-19 disruption related to its operational uptime and will continue to enforce proper measures to minimize the risk level. The Company continually evaluates measures to reduce risk exposure as mentioned above.

The Company is exposed to interest rate and currency risk, primarily through financing and contracts. Currency risk is to a certain extent mitigated by having debt in the same currency as charter agreements.

For further details, reference is made to section Annual Report 2020 Note 1, 2, 4, 28 and the risk section of the Prospectus from the Company published on 19 October 2020.

Normand Maximus update ximus update

As stated in previous communications, Normand Maximus Limited continues its dialogue with its financiers, to find a long-term solution for the financing of Normand Maximus following Saipem's early termination of the time charter. The agreements related to Normand Maximus entitle Maximus Limited as owner of the Vessel to require Normand Maximus Limited to buy the vessel and/ or exercise other rights and remedies under the lease financing if a solution is not found. Absent a solution, there is a risk in the current markets that Normand Maximus Limited as bareboat charterer of the Normand Maximus will not be able to finance such a purchase or other claims. As all obligations of Normand Maximus Limited are guaranteed by Solstad Offshore ASA, this could have a material adverse effect on Solstad Offshore ASA's financial situation. As advised in our 2Q report, the Company has received summons from M. Y. F Maximus Limited as a former shareholder in Maximus Limited, for a declaratory relief that M.Y.F Limited has a recourse claim against the Company. The hearing is scheduled to 2Q 2022. Further details on the fi nancing of Normand Maximus are set out in "Finance" and Annual Report 2020 Note 1, 2, 4 and 28 and the risk section of the Prospectus from the Company published on 19 October 2020. ations Norm his mate 2Q re ils on Norm 020 Note 1, 4 ed on 19 Oc munications, Lim or finan arter. ag to rights

Normand Tortuga, Normand Swift, Normand Sitella, Sea Spear, Sea Spark, Normand Seranade, Normand Arctic and anchor handler trading in the North Sea spot market awarded up to approximately 1,000 vessels days and options to extend contracts further.

• Normand Navigator awarded a contract with an undisclosed client in South East Asia to keep the vessel utilized through 2021.
• Normand Frontier contracts for operations in South Africa for a large international contractor for 100 days fi rm plus 60 days options excluding mobilization and demobalization to support a ultra-deep subsea project.
• Normand Jarstein awarded a new contract with DeepOcean to support their IMR light construction, offshore renewables and recycling projects. The vessel commence to the contract in 1Q 2022 and have a fi rm period til end of 2023 with the option to extend the contract till end of 2024.
• Normand Flower to operate for Petrobras for 3 years fi rm plus 475 days option thereafter to support exploration and production activities in Brazilian continental shelf with commencement within April of 2022.
• Normand Pacifi c extended her fi rm period to operate for Prysmian till end of 2022. In addition, Prysmian has the option to extend the contract with an additional 2 years beyond the fi rm period.

Subsequent Events

On the October 14th, 2021 Solstad Offshore, Aker Solutions and DeepOcean Norway joined forces to create Windstaller Alliance. The new partnership aims to provide the world's most cost-effi cient and complete product supply, fabrication and marine services offering within offshore wind. The alliance will also pursue other offshore renewables segments.

The Company has sold the CSV Far Saga November 8th, 2021 resulting in a minor gain in 4Q 2021. In addition, the Company has sold PSV Rem Provider November 12th, 2021 and PSV Far Swan November 16th, 2021 resulting in an immaterial accounting effect in 4Q 21.

The Company has October 5th,2021 sold seven vessels for recycling. The vessels are Sea Tiger, Normand Atlantic, Normand Borg, Normand Neptun, Sea Pollock, Far Strider and Far Sovereign. The sales will result in an immaterial accounting effect in

4Q 21

Awards in the quarter

Company increased its backlog during the quarter with an order intake of approx. MNOK 2,000.

• Normand Energy awarded a contract with a key client for 13 months fi rm for subsea operations in West Africa.
• Multiple medium-term contracts and extentions for approximately 1.000 vessel days plus options awarded for the following vessels: Normand Leader,

Contracts after quarter end

• Normand Samson chartered to a major oil service company for a period of minimum 350 days with options to extend with additional 150 days. The vessel will be utilized on a fi eld development project in South America.
• Normand Supporter and Normand Server extended with one year for ConocoPhillips Skandinavia AS with options for 2 x 1 year thereafter.
• Far Superior chartered to MMT Sweden AB for a period of two years with one year option. The contract will commence February 2022.
• Normand Mermaid awarded contract with Fugro Nertherlands Marine BV for a period of 16 months fi rm.
• Normand Baltic extended for an additional 8 months plus 90 days options with current client.
• Far Symphony awarded a term contract with Ithaca Energy for one year fi rm plus options up to one year.

Operational Update

Solstad Group ("the Company") is a world leading owner and operator of offshore service vessels.

As per September 2021, the Company owns and/or operates a core fl eet of 90 vessels. The overall utilization for the operational fl eet in 3Q 2021 was 89% (86% in 2020), the subsea CSV fl eet had a utilization of 90% (83%), AHTS fl eet 86% (83%) and 90% (90%) for the PSV fl eet.

Subsea & Renewable Energy

In 3rd quarter, the CSV segment had 26 vessels in operation for Clients in the Global markets. Around 30% of the CSV revenues came from Renewable energy.

Several new contracts has been signed, at improved terms, and bidding activity remains high in both oil & gas and offshore-wind.

Non-strategic fl eet

Solstad are in the process of selling vessels that are defi ned as non-strategic and not a part of the future Solstad-fl eet.

In general, these are the oldest and smallest vessels in the fl eet. Pr. 30.09.21, 14 of 37 vessels had exited the fl eet, while 10 has been sold after quarter end.

AHTS & PSV

The AHTS & PSV segment had 55 vessels in operation in 3rd quarter, with the majority of the fl eet operating in the strategic key regions the North Sea, Australia and Brazil.

Several contracts has been awarded in all key regions and bidding activity remains at a high level.

* vessels in operation (81 vessels)

Market Outlook

The combination of the current oil & gas price and increasing investment plans within offshore-wind is expected to have a positive impact on the demand for offshore vessels.

Particularly for the CSVs serving both segments, the demand for vessels are increasing and commercial terms are improving.

Within offshore-wind the tendering activity is high and Solstad is involved in a number of tender processes, both on time charters and on extended offerings via the Windstaller Alliance that was established by Solstad, Deepocean and Aker Solutions in October 2021.

The Windstaller Alliance has been positively received by Clients and are already involved in tenders for renewable energy projects with execution in 2022 and onwards.

The subsea contractors continue to build their backlog and there are a number of tenders for "year- around" and seasonal contracts. Solstad has signed several new contracts in this segment during 3Q and so far in 4Q.

For the AHTS and PSV segment there are also an activity increase, but the number of active vessels still have a negative effect on the rate levels. In particularly that goes for the PSV segment. Demand for the large AHTS vessels is increasing with long-term tenders and several project opportunities.

The Company's backlog is approximately MNOK 5,000 whereof MNOK 3,000 is for the next 12 months.

Sustainability

In Solstad we have sustainability as one of our top priorities. By involving all employees, key clients and main suppliers we can jointly work towards a sustainable future.

• The following 8 vessels have now been sold for recycling: Sea Panther, Sea Tiger, Normand Atlantic, Normand Borg, Normand Neptun, Sea Pollock, Far Strider and Far Sovereign. The vessels will be recycled at Green Yard Kleven and Green Yard Feda.
• The high operational standard in the company continues by focusing on safety at all stages of its operations. During the quarter, the company has reduced its TRFC frequency and registered 1,29 at the end of the quarter.
• November 17th the Company received the "Environmental Award 2021" by Offshore Support Journal in London. The award was given for upgrading the Company fl eet with battery-hybrid propulsion and seeing its ninth PSV operating on the Norwegian continental shelf with battery-hybrid propulsion.

Quarterly ESG Indicators

All ind icat aila ble http s:// olst ad. /su ina bilit y/ sta ors av on ww w.s com
Env iron t men	Unit	Targ et 202 1	3Q	2Q	1Q	2020	2019	2018
Flee t effi cien cy*	%	23 %	21 %	21 %	21 %	20%	17 %	16 %
CO2 pe 1 (ow tivity ) , sco n ac	tCO 2	-	237 ,959	178, 746	153, 133	696 ,888	801, 578	714, 722
Oil s pill l itres	Litre s	0	41	76	24	349	113	679
Fine s for mpli of e nviro ntal latio non e-co ance nme regu ns	No.	0	0	0	0	0	0	0
Sing le us e pla stic wate r bot tles on b oard sels our ves	%	0	51,4 61	53,7 19	33,2 14	233 ,219	-	-
Soc ial
TRC F (12 nths roll ing, Tota l Re cord able Cas e Fr ncy) * -mo eque	No.	1.10	1,29	1,64	1,31	1.28	1.65	1.86
Frac tion of a ll em ploy plete d su stain abili ty tr ainin g ** ees com	%	100 %	83 %	80 %	50 %	43 %	-	-
Gov erna nce
Incid rela ted t o Co tion and Brib ents rrup ery	No.	0	0	0	0	0	0	0

* per 1,000,000 hour

** Training started 21.12.2020

*** Baseline for the effi ciency target is an average of each vessel's performance over the past 3 years. The increased performance comes from operational measures (Solstad Green Operations) and/or technical upgrades such as battery and/or shore power systems. The increase total emissions for Q3 is related to increased activity including more vessels in operation.

Social

At the end of 2nd quarter the Total Recordable Case Frequency (TRCF) was 1.72 (too high / goal 1.10). As a consequence of this several initiatives where kicked-off to engage with the vessel management and crew to identify immediate measures that could infl uence on the day to day safety focus onboard the vessels. Since then the TRCF has decreased down to 1.29 due to a falling number of incidents in 3rd quarter (only 2 recordable minor incidents in August). The TRCF is by end of 3rd quarter 1.29.

Governance

No material governance incidents have been registered during the period. A total of 144 audits, port state controls etc. have been completed this quarter, resulting in no major fi ndings.

Environment

As part of the ESG leading indicators the company now track carbon intensity data for its fl eet showing emissions per day per vessel and vessel type in addition to total fl eet emissions.

ty/
arne

The company currently works on plans to establish pilot projects to investigate the use of fuel cell technology and multi-fuel solutions for internal combustion engines that will allow for low or zero emission operations on existing vessels in the medium term and on new builds on the longer term.

The amount of unwanted oil spills to sea is declining over time. This is a positive trend.

The goal this year to stop using single use plastic bottles in the fl eet has been more challenging that was expected for various reasons around the world. There is still a way to go reach our goal.

Harald Espedal Chairman

Thorhild Widvey Director

Ellen Solstad Director

Ingrid Kylstad Director

Lars Peder Solstad CEO

Peder Sortland Director

Frank O. Reite Director

Skudeneshavn 25.11.2021

Condensed statement of comprehensive income

(NOK 1,000)

	202 1 01.0 7-30 .09	202 0 01.0 7-30 .09	202 1 01.0 1-30 .09	202 0 01.0 1-30 .09	202 0 01.0 1-31 .12	No te
Ope rati ng i nco me	1,50 0,03 2	1,31 5,91 1	4,10 1,18 1	3,85 0,84 1	5,02 5,63 0	2,3, 4
Ves sel o ting pera exp ens es	-927 ,944	-866 ,918	-2,6 28,7 61	-2,6 08,5 64	-3,5 16,9 21
Adm inist rativ e ex pen ses	-97, 178	-81, 898	-312 ,650	-273 ,361	-476 ,829
Tota l op erat ing exp ens es	-1,0 25,1 22	-948 ,817	-2,9 41,4 11	-2,8 81,9 25	-3,9 93,7 50	4
Ope fore rati lt be dep reci atio ng r esu ns	474 ,910	367 ,094	1,15 9,77 0	968 ,916	1,03 1,88 0	3
Ord inar y de iatio prec n	-314 ,774	-327 ,636	-951 ,682	-1,0 72,7 75	-1,3 58,3 45	5
Imp airm ent	-	-862 ,158	-45, 049	-1,8 22,6 55	-1,8 95,0 40	5,6
Net gain / los sal e of ets s on ass	-8,1 24	77	-28, 339	-28, 882	-28, 896
Ope rati lt ng r esu	152 ,012	-822 ,623	134 ,700	-1,9 55,3 95	-2,2 50,4 02
Res ult f Joi nt V entu rom res	3,93 2	5,85 3	-3,0 04	33,2 43	23,9 75	7
Res ult f ocia ted ies rom ass com pan	-80	8,55 0	88	27,5 02	41,4 23	7
Tota l oth er it ems	3,85 2	14,4 03	-2,9 16	60,7 45	65,3 98
Inte rest inc ome	3,63 4	3,10 0	7,95 0	13,4 86	6,37 3
Rea lised in/ - loss cur renc y ga	9,11 2	-38, 314	4,08 3	5,42 9	-240 ,107
Unr eali sed in/ - loss cur renc y ga	-90, 524	115, 518	-172 ,854	-712 ,994	-180 ,349
Inte rest cha rges	-251 ,061	-415 ,447	-750 ,542	-1,18 1,62 4	-1,4 37,6 19
Net fi na ncia l cha / -in rges com e	29,4 59	-806	67,7 42	-415 ,976	11,2 87,0 55
Net fi na ncin g	-299 ,380	-335 ,948	-843 ,620	-2,2 91,6 80	9,43 5,35 3
Ord inar sult bef taxe y re ore s	-143 ,516	-1,14 4,16 8	-711 ,836	-4,1 86,3 30	7,25 0,34 9
Tax rdin lt es o ary resu	-4,6 86	-3,4 38	-16, 616	-15, 816	3,51 7	9
Res ult	-148 ,202	-1,14 7,60 6	-728 ,452	-4,2 02,1 46	7,25 3,86 6
Oth rehe nsiv e in er c omp com e:
Exc han ge d iffer n tra nsla ting enc es o fore ign ratio ope ns	-126 ,451	153 ,008	-114 ,754	25,7 84	580 ,397
in/ lo Actu aria l ga ss	-	-	-	-	5,92 1
Oth rehe nsiv e in er c omp com e	-274 ,653	-994 ,598	-843 ,206	-4,1 76,3 62	7,84 0,18 4
Res ult a ttrib utab le to :
Non troll ing inte rest -con s	-755	1,07 7	536	6,48 9	13,1 22
Maj ority sha re	-147 ,447	-1,14 8,68 3	-728 ,988	-4,2 08,6 35	7,24 0,74 3
Earn ings sha per re	-1,9 6	-3,9 4	-9,7 1	-14, 42	29.1 3
Oth rehe nsiv e in er c omp com e attri buta ble t o:
Non troll ing inte rest -con s	-755	1,07 7	536	6,48 9	13,1 22
Maj ority sha re	-273 ,898	-995 ,675	-843 ,742	-4,1 82,8 51	7,82 7,06 2
Oth rehe nsiv e in r sh er c omp com e pe are	-3.6 5	-3.4 1	-11. 24	-14. 33	31.4 8
EBI TDA adj uste d	500 ,002	395 ,007	1,24 1,42 6	1,08 9,31 3	1,28 2,20 8	3,4
Ave ber of s hare s (1 ,000 ) rage num	75,0 90	291 ,407	75,0 07	291 ,407	249 ,042

Condensed statement of fi nancial position

(NOK 1,000)

ASSETS

Fixed Assets: Intangible assets Tangible fi xed assets Right-of-use assets

Investment in assosiated companies and Joint Ventures

Financial fi xed assets

Total fi xed assets

Current Assets:

Stocks Accounts receivables

Other receivables

Market based shares

Deposits, cash, etc

Total current assets

Assets held for sale

TOTAL ASSETS

202 1 30.0 9	202 0 30.0 9	202 0 31.1 2	No te
5,56 5	10,4 87	13,0 79
18,6 92,9 10	20,2 33,6 32	19,5 09,6 19	5
2,44 7,92 1	2,92 1,18 8	2,45 7,32 2	6
96,1 60	443 ,796	111, 032	7
118, 381	170 ,269	109 ,147	4
21,3 60,9 36	23,7 79,3 73	22,2 00,1 99
174, 538	168 ,884	165 ,330
977 ,989	1,04 8,22 5	839 ,628
471 ,494	565 ,847	414 ,011
15,2 50	8,29 5	11,1 00
2,34 3,26 2	1,05 4,00 8	2,41 1,90 5	8
3,98 2,53 3	2,84 5,26 0	3,84 1,97 4
71,4 88	18,9 62	26,8 03	5
25,4 14,9 57	26,6 43,5 95	26,0 68,9 76
251 ,630	4,60 2,78 2	250 ,445
3,13 3,07 4	-12, 623 ,744	3,97 6,81 6
29,5 49	9,18 0	15,8 14
3 41 4 25 4	-8,0 11,7 82	4,24 3,07 5
30,1 59	75,4 45	37,8 85
2,02 1	11,9 22	12,3 72	8
17,6 61,0 93	4,07 0,86 0	17,1 30,6 48	8
17,6 93,2 73	4,15 8,22 8	17,1 80,9 05
3,27 1,12 0	28,3 04,8 17	3,49 9,89 7	8
1,03 6,31 0	2,19 2,33 3	1,14 5,09 9
4,30 7,43 0	30,4 97,1 50	4,64 4,99 6
22,0 00,7 03	34,6 55,3 78	21,8 25,9 02
25,4 14,9 57	26,6 43,5 95	26,0 68,9 76

EQUITY AND LIABILITIES

Equ ity:
Paid -in e quit y
Oth quit er e y
Non troll ing inte rest -con s
Tota l eq uity
Liab ilitie s:
Lon g-te rovi sion rm p s
Oth er lo deb ng-t t erm
Deb cred it ins titut ions t to
Tota l lon g-te rm d ebt
Cur rent liab ilitie s:
Cur rent tion of l -ter m d ebt por ong
Oth nt lia biliti er c urre es
Tota l cu t lia bilit ies rren

Total liabilities

TOTAL EQUITY AND LIABILITIES

Statement of cash fl ow

(NOK 1,000)

CASH FLOW FROM OPERATIONS

Res ult b efor e ta x
Tax ble es p aya
Ord inar y de iatio d w rite dow prec n an ns
Gai n (-) / los s lo ng-t ets erm ass
Inte rest inc ome
Inte rest exp ens e
Term inat ed l eas es
fi na effe Non h re cts -cas nce
Effe f ch e in sion ct o ets ang pen ass
Cha in v alue of fi cial inst ents nge nan rum
Unr eali sed in/ - loss cur renc y ga
Cha in s hort -ter ceiv able d pa yab les nge m re s an
Cha in o ther rual nge acc s
Net h fl o w fr rati cas om ope ons

CASH FLOW FROM INVESTMENTS

202	202	202
1	0	0
30.0	30.0	31.1
9	9	2
-711 ,836	-4,1 86,3 30	7,25 0,34 9
-13,	-14,	-35,
319	217	649
996 ,731	2,89 5,43 0	3,25 3,38 6
4,14	37,4	321
3	54	,975
-7,9	-13,	-6,3
50	486	73
750 ,542	1,18 1,62 4	1,43 7,61 9
-	373 ,707	439 ,559
-	-	-11,7 13,2 86
-	-1,8 65	7,69 5
-	-170 ,482	-170 ,239
167,	682	140
484	,235	,113
-124	109	212
,513	,332	,570
-171	-143	-361
,576	,425	,760
889	749	,960
,706	,976	775
-48	-21,	-57,
,207	338	385
-165	-343	-406
,497	,221	,800
113, 747	1,01 4,17 0	1,01 4,17 0
-9,2	5,97	64,0
34	4	06
7,95	6,45	6,24
0	0	3
-	1,70 1	36
-101	663	620
,240	,737	,270
-	-	70,3 55
-292	-388	-461
,828	,382	,777
-393	-51,	-157
,997	188	,973
-	1,10 8,45 4	1,46 7,96 2
-175 ,654	-2,2 31,9 85	-1,0 77,1 55
-862 ,479	-1,5 63,1 00	-158 ,588
5,37	69,3	40,2
0	67	36
-74, 013	-149 ,386	1,23 7,64 2
2,41	1,13	1,13
1,90	4,02	4,02
5	8	8
2,34	1,05	2,41
3,26	4,00	1,90
2	8	5

h fl from inv Net est ts cas ow men
Rea lizat ion of s hare d ho lding s an s
Rec eive d in tere sts
Pay t of long -ter ceiv able men m re s
Con side ratio le of fi xe d as sets (ve ls) n sa sse
Pay t of peri odic inte men ma nan ce
Inve in ta ngib le fi x ed a stm ent sset s

CASH FLOW FROM FINANCING

Paid -in c apit al
Paid lea ses
Paid inte rest s
Draw dow n lo deb ng-t t erm
Rep ent of lo ng-t deb t aym erm
h fl o w fr fi na Net ncin cas om g
Effe f ch es i n fo reig cha ct o rate ang n ex nge s
Net cha in c ash nge

Cash at balance sheet date

Statement of changes in equity

(NOK 1,000)

	Sha re capi tal	Trea sury shar es	Sha re ium prem	Othe r paid -in capi tal	Othe r chan ges	Othe uity r eq	Tota l majo irty shar es	Non cont rolli ng inte rest s	Tota l equ ity
Equ ity 0 1.01 .202 1	74,8 73	0	175 ,572	0	981 ,656	2,99 5,16 1	4,22 7,26 1	15,8 14	4,24 3,07 5
Res ult	-	-	-	-	-	-729 ,060	-729 ,060	536	-728 ,525
Tran slat ion adju stm ents	-	-	-	-	-114 ,754	-	-114 ,754	-	-114 ,754
Oth er hen sive com pre inco me	0	0	0	0	-114 ,754	-729 ,060	-843 ,742	536	-843 ,206
Sha apit al re c incr e by eas vert ion of d ebt con	417	-	768	-	-	-	1,18 6	-	1,18 6
Equ ity c ontr ibut ion	-	-	-	-	-	-	-	13,2 00	13,2 00
ity 3 0.09 .202 1 Equ	75,2 90	0	176 ,340	0	866 ,902	2,26 6,17 3	3,38 4,70 5	29,5 49	3,41 4,25 4

Equ ity 0 1.01 .202 0	583 ,065	-281	3,69 8,35 0	321 ,648	401 ,259	-8,8 42,1 52	-3,8 38,1 11	2,69 1	-3,8 35,4 20
Res ult	-	-	-	-	-	-4,2 08,6 35	-4,2 08,6 35	6,48 9	-4,2 02,1 46
Tran slat ion adju stm ents	-	-	-	-	25,7 84	-	25,7 84	-	25,7 84
Oth er hen sive com pre inco me	0	0	0	0	25,7 84	-4,2 08,6 35	-4,1 82,8 51	6,48 9	-4,1 76,3 62
Equ ity 3 0.09 .202 0	583 ,065	-281	3,69 8,35 0	321 ,648	427 ,043	-13, 050 ,787	-8,0 20,9 62	9,18 0	-8,0 11,7 82

Equ ity 0 1.01 .202 0	583 ,065	-281	3,69 8,35 0	321 ,648	401 ,259	-8,8 42,1 52	-3,8 38,1 11	2,69 1	-3,8 35,4 20
Res ult	-	-	-	-	-	7,24 0,74 3	7,24 0,74 3	13,1 22	7,25 3,86 6
Actu aria l ga in/ loss (-)	-	-	-	-	-	-5,9 21	-5,9 21	-	-5,9 21
Tran slat ion adju stm ents	-	-	-	-	580 ,397	-	580 ,397	-	580 ,397
Oth er hen sive com pre inco me	0	0	0	0	580 ,397	7,23 4,82 2	7,81 5,21 9	13,1 22	7,82 8,34 2
Sha apit al re c dec reas e	-582 ,773	281	-	-	-	582 ,492	0	-	0
Tran sfer of p aid- in ital cap	-	-	-3,6 98,3 50	-321 ,648	-	4,01 9,99 9	0	-	0
Sha apit al re c incr e by eas vert ion of d ebt con	48,0 75	-	131, 723	-	-	-	179 ,798	-	179 ,798
Sha apit al p riva t re c plac nt eme	26,5 06	-	43,8 49	-	-	-	70,3 55	-	70,3 55
Equ ity 3 1.12 .202 0	74,8 73	0	175 ,572	0	981 ,656	2,99 5,16 1	4,22 7,26 1	15,8 14	4,24 3,07 5

Notes

Notes to condensed statement of comprehensive income and statement of fi nancial position

(NOK 1,000)

Note 1 - General

Solstad Offshore ASA (SOFF) has its head offi ce in Skudeneshavn, Norway. The main activities of the company are operation and ownership of offshore service and construction vessels. The Group is listed on Oslo Stock Exchange. The quarterly accounts are prepared using the same accounting principles as last year's accounts and in compliance with IAS 34 Interim Financial Reporting.

The interim accounts are prepared on the assumption of a going concern. The going concern assumption is based on the level of cash and cash equivalents at reporting date, terms and conditions of the banking and borrowing facilities, the forecasted cash fl ow prognosis for the Group and the backlog position. Based on the information given on "Normand Maximus" related to the bareboat charter, the Board of Directors needs to point out that there is uncertainty related to the going concern assumption of Solstad Offshore ASA.

Note 2 - Operating income

The Group's revenues mainly derives from offering vessels and maritime personnel to customers world wide. Basically all contracts with customers are contracts with day rate. Contract with day rate is contract where income is eared on a day-by-day basis, based on an agreed day rate with the customer. Revenue from contracts with day rate is recognized accordingly.

The agreed day rate is divided into a service element and a lease element. The service element includes the maritime services provided to navigate the vessel according to the customers requirements, while the lease element is the estimated rental of the vessel (equipment).

Some of the contracts also includes victualling and onshore project management. Victualling is meals and bedding provided to the customers personnel onboard the vessel. The Group also provides ordinary management services, such as technical services, crewing, incurance and commercial management for vessels not owned by the Group. Revenue on services, mentioned above, are recognized over time, as the performance obligation is satisfi ed over time.

	202 1 01.0 7-30 .09	202 0 01.0 7-30 .09	202 1 01.0 1-30 .09	202 0 01.0 1-30 .09	202 0 01.0 1-31 .12
Ser vice ele t fro ontr act with day rate men m c	621 ,955	494 ,971	1,56 2,90 9	1,53 1,49 3	2,03 2,59 8
Man t Fe age men e	1,67 0	3,42 2	6,92 7	24,5 72	27,2 68
Vict uall ing	31,5 25	27,9 63	78,2 86	70,9 88	93,1 11
Proj ect t man age men	-	-	-	4,25 3	3,32 9
Oth er	107, 645	66,2 30	136 ,068	67,7 09	57,8 96
Rev e fro m C ith ont ract enu s w cur som ers	762 ,795	592 ,586	1,78 4,19 0	1,69 9,01 5	2,21 4,20 2
from Lea sing trac ts w ith d ate con ay r	737 ,236	723 ,326	2,31 6,99 1	2,15 1,82 7	2,81 1,42 9
Tota l op ing inco erat me	1,50 0,03 2	1,31 5,91 1	4,10 1,18 1	3,85 0,84 1	5,02 5,63 0

Contract balance

Con trac t ba lanc e	30.0 9.20 21	30.0 9.20 20	31.1 2.20 20
Trad ceiv able s fro hart e re m c ers	977 ,989	1,04 8,22 5	839 ,628
Con trac t as sets	-	-	-
Con trac t lia biliti es	-	35,8 40	-

Note 3 - Reporting per segment

Internally the Group reports and monitors it's operation in the following segments:

• AHTS, anchorhandling vessels

• PSV, platform supply vessels

• Subsea, construction vessels operating subsea construction contracts

• Renewable, vessels operating renewable contracts

Figures are exclusive share result from Joint Ventures.

Changes in reporting from 2020 Annual Report:

• Reporting on Renewable segment comenced on January 1st 2021

• AHTS and PSV is reported separately from January 1st 2021 Q3 2021

	S AHT	PSV	Sub sea	Ren ble ewa	Tota l
Rev e fro wit h cu ontr acts stom enu m c ers	154 ,721	290 ,507	273 ,541	44,0 25	762 ,795
Lea lem ent from trac ts w ith d ate se e con ay r	208 ,256	138 ,925	289 ,577	100 ,478	737 ,236
Tota l op erat ing inco me	362 ,978	429 ,433	563 ,118	144 ,503	1,50 0,03 2
Crew exp ens es	153 ,323	200 ,537	119, 475	54,9 72	528 ,307
Oth er e xpe nse s	103 ,540	127 ,235	152 ,182	54,7 20	437 ,677
Tota l op erat ing exp ens es	256 ,862	327 ,772	271 ,658	109 ,692	965 ,984
Bun kers	6,02 8	1,31 1	41,1 77	10,6 22	59,1 38
Ope rati lt be fore ng r esu
dep reci atio ns	100 ,087	100 ,350	250 ,284	24,1 89	474 ,910
Exc and les lues frei ght trac ts ess s va con	-	-	1,87 5	-	1,87 5
Net lt fro m Jo int V entu resu re	-	-	3,93 2	-	3,93 2
Adj uste d op erat ing lt be fore resu
dep reci atio ns	100 ,087	100 ,350	256 ,090	24,1 89	480 ,716

Q3 2020

	S AHT	PSV	Sub sea	Ren ble ewa	Tota l
e fro Rev ontr acts wit h cu stom enu m c ers	152 ,182	186 ,060	208 ,724	45,6 19	592 ,585
Lea lem ent from trac ts w ith d ate se e con ay r	153 ,514	185 ,664	310 ,028	74,1 20	723 ,327
Tota l op erat ing inco me	305 ,697	371 ,724	518 ,751	119, 739	1,31 5,91 1
Crew exp ens es	139 ,542	187 ,252	114, 481	42,5 77	483 ,852
Oth er e xpe nse s	97,0 38	108 ,559	195 ,452	35,9 67	437 ,016
Tota l op erat ing exp ens es	236 ,580	295 ,811	309 ,933	78,5 44	920 ,868
Bun kers	11,8 49	4,45 8	9,62 8	2,01 4	27,9 49
Ope rati lt be fore ng r esu
dep reci atio ns	57,2 67	71,4 55	199 ,191	39,1 82	367 ,094
Exc and les lues frei ght trac ts ess s va con	-	10,6 96	2,81 2	-	13,5 08
Net lt fro m Jo int V entu resu re	-	-	5,85 3	-	5,85 3
Adj uste d op erat ing lt be fore resu
dep reci atio ns	57,2 67	82,1 51	207 ,856	39,1 82	386 ,455

YTD Q3 2021

	AHT S	PSV	Sub sea	Ren ble ewa	Tota l
Rev e fro ontr acts wit h cu stom enu m c ers	389 ,177	599 ,693	636 ,995	158 ,326	1,78 4,19 0
Lea lem ent from trac ts w ith d ate se e con ay r	506 ,806	462 ,887	1,08 8,97 7	258 ,321	2,31 6,99 1
Tota l op ing inco erat me	895 ,983	1,06 2,58 0	1,72 5,97 2	416 ,646	4,10 1,18 1
Crew exp ens es	421 ,660	549 ,704	393 ,242	130 ,230	1,49 4,83 6
Oth er e xpe nse s	319 ,922	363 ,350	513 ,824	155 ,673	1,35 2,76 9
Tota l op erat ing exp ens es	741 ,582	913 ,054	907 ,066	285 ,903	2,84 7,60 5
Bun kers	20,4 34	13,1 72	47,7 38	12,4 62	93,8 06
Ope rati lt be fore ng r esu
dep reci atio ns	133 ,967	136 ,353	771 ,168	118, 281	1,15 9,77 0
Exc and les lues frei ght trac ts ess s va con	-	-	7,49 9	-	7,49 9
lt fro Net m Jo int V entu resu re	-	-	-3,0 04	-	-3,0 04
Adj uste d op erat ing lt be fore resu
dep reci atio ns	133 ,967	136 ,353	775 ,662	118, 281	1,16 4,26 5

YTD Q3 2020

	S AHT	PSV	Sub sea	Ren ble ewa	Tota l
Rev e fro wit h cu ontr acts stom enu m c ers	409 ,111	559 ,955	624 ,372	105 ,576	1,69 9,01 3
Lea lem ent from trac ts w ith d ate se e con ay r	416 ,558	570 ,449	996 ,774	168 ,047	2,15 1,82 8
Tota l op erat ing inco me	825 ,668	1,13 0,40 4	1,62 1,14 5	273 ,623	3,85 0,84 1
Crew exp ens es	443 ,302	584 ,927	406 ,295	89,0 00	1,52 3,52 5
Oth er e xpe nse s	301 ,985	346 ,962	508 ,729	80,7 99	1,23 8,47 5
Tota l op erat ing exp ens es	745 ,287	931 ,889	915 ,025	169 ,799	2,76 2,00 0
Bun kers	53,9 99	23,9 99	36,0 42	5,88 6	119, 925
Ope rati lt be fore ng r esu
dep reci atio ns	26,3 82	174 ,517	670 ,079	97,9 38	968 ,916
Exc and les lues frei ght trac ts ess s va con	-	44,6 90	14,9 60	-	59,6 50
Net lt fro m Jo int V entu resu re	-	-	33,2 43	-	33,2 43
Adj uste d op erat ing lt be fore resu
dep reci atio ns	26,3 82	219 ,207	718 ,282	97,9 38	1,06 1,80 9

Note 5 - Fixed assets (continued)

Impairment testing of vessels

Summary

The Company has performed impairment testing of the fl eet in accordance with IAS 36. Indicators such as slow market recovery and declining price/ book ratio form, according to IAS 36, the need for revaluation of the Company's assets.

Based on value-in-use-calculations impairment charges recognized in 3Q 2021 was NOK 0. Total impairment of fi xed assets recognized year to date 3Q 2021 is MNOK 45.

Impairment testing

Impairment testing (value-in-use-calculation) was performed for all vessels where book value exceeds 65% of broker value. Broker value is set as an average of 3 acknowledged, independent brokers. Each vessel is considered a separate cash generating unit. The value-in-use-calculations are based on budget and the long-term forecast for 2021-2025.

The main assumptions used in the computations are charter rates, utilization, escalation of expenses, operational area, interest rate, weighted average cost of capital (WACC) and performance per Q3 2021 compared to forecast.

Discounting rate

The discounting rate is based on a common WACC for the Company. The cost of equity is derived from the 10-year interest rate for state bonds (risk-free interest rate), the Company's own market risk premium and an unlevered beta. The debt element of the discounting rate is based on the risk-free interest rate, plus the Company's average margin for secured debt, as well as a premium equivalent to the difference between risk-free interest rate and the bank's lending rates. The discounting rate used for Q3 2021 is 9%.

Revenue assumptions

For vessels having fi rm contracts, revenue is based on the current contracts. For vessels without fi rm contracts, and for vessels where the fi rm contract expires during the period, revenue is based on historical data. For the fi rst period it is expected that the day rates for the PSV- and AHTS segment will remain low. From 2026 to 2028 it is assumed a gradual increase of revenue to a level which correspond to the average rates for the past 7-10 years. It is expected that the markets are normalized within 2027.

Infl ation

Escalation of revenue is expected to be marginal for the coming year. Hence, it is used a low (<1%) or no infl ation of revenue in 2021. Operating cost is adjusted for infl ation by 2%. Infl ation of revenue correspond to cost from 2026.

Residual values

Estimated residual values used in the value-in-use-calculations are set using the same principle as for the ordinary depreciations. Initially the value is set to 50% of cost price, expected cost of sale deducted, and adjusted for age and changes in broker valuations. The assumption is that the broker values decline by 2.5% per year, until the vessel is 20 years old.

Note 4 - EBITDA

	202 1 01.0 7-30 .09	202 0 01.0 7-30 .09	202 1 01.0 1-30 .09	202 0 01.0 1-30 .09	202 0 01.0 1-31 .12
Tota l op erat ing Inco me	1,50 0,03 2	1,31 5,91 1	4,10 1,18 1	3,85 0,84 1	5,02 5,63 0
Tota l op erat ing exp ens es	-1,0 25,1 22	-948 ,817	-2,9 41,4 11	-2,8 81,9 25	-3,9 93,7 50
EBI TDA	474 ,910	367 ,094	1,15 9,77 0	968 ,916	1,03 1,88 0
Lea ses	12,3 21	-	30,8 54	-	6,46 5
Res truc turin st g co	7,04 5	-	46,2 19	-	108 ,887
Exc and les lues frei ght trac ts ess s va con	1,87 5	13,5 10	7,49 9	59,6 50	62,4 62
Net lt fro m Jo int V entu resu re	3,93 2	5,85 3	-3,0 04	33,2 43	23,9 75
Net lt fro ciat ed c anie resu m a sso omp s	-80	8,55 0	88	27,5 02	41,4 23
Acc rual los nts ivab le s ac cou rece	-	-	-	-	7,11 5
EBI TDA adj uste d	500 ,002	395 ,007	1,24 1,42 6	1,08 9,31 1	1,28 2,20 8

In connection with the merger with Rem Offshore, Farstad Shipping and Deep Sea Supply, the purchase price alloction analysis identifi ed several long-term freight contracts where the daily rates were higher or lower than the market rate at the time of acquisition. A part of the purchase price was thus allocated to these excess / less values and capitalized. In line with the fulfi llment and revenue recognition of freight contracts, the capitalized excess / less value is derecognized. The adjustment has no cash effect, and thus comes as an addition to booked freight income when calculating EBITDA.

Note 5 - Fixed assets

	Per iodi c
	Ves sels	mai nten anc e	Oth er	Tota l
Ope ning bal e 01 .01. 202 1 anc	18,7 16,1 31	760 ,223	33,2 65	19,5 09,6 19
Add ition s	47,5 09	165 ,497	-	213 ,006
Ass et h eld f ale or s	-63, 260	-8,2 29	-	-71, 488
Disp ls osa	-117 ,685	-	-	-117 ,685
Tran slat ion adju stm ent	106 ,237	-18, 772	56	87,5 20
Dep reci atio n	-676 ,234	-201 ,741	-5,0 38	-883 ,013
Imp airm ent	-45, 049	-	-	-45, 049
Clo sing bal e 30 .09. 202 1 anc	17,9 67,6 49	696 ,979	28,2 83	18,6 92,9 10

Vessels are depreciated over 20 years to a residual value equal to 50% of the original cost. Initially residual value is set to 50% of cost price, expected cost of sale deducted, and adjusted for age and changes in broker valuations. The assumption is that the broker values decline by 2.5% per year, until the vessel is 20 years old. Other assets are depreciated at rates of 10-25%.

In 4Q 2021 the Company have sold seven vessels for recycling and the intent is to sell additional three vessels. These assets are classifi ed as held-for-sale in Condensed Statements of Financial Position. Total book value is MNOK 71.5.

Note 7 - Investment in Associated Companies and Joint Ventures

The Group had the following shares in joint ventures (JV) and associated companies (AC) at balance sheet date:

AC	JV
Sols Offs Cre Ser (25 %) tad hore wing vice Phi lipp ines

Normand Installer SA (50 %)

	AC	JV	Tota l
Ope ning bal anc e	1,12 8	113 ,252	114 ,380
Sha f res ult y to d ate re o ear	88	-3,0 04	-2,9 16
Add ition s	-	-	-
Disp ls osa	-	-	-
Imp airm ent	-	-	-
Oth djus tme nts er a	37	-15, 341	-15, 304
Clo sing Ba lanc e	1,25 3	94,9 07	96,1 60

Other adjustments includes received dividends and currency effects.

Note 6 - Right-of-use assets

	Righ t-of- use
	Ves sels	Offi ce	Tota l	Lea se l iabi litie s
Ope ning bal e 01 .01. 202 1 anc	2,21 2,85 4	244 ,467	2,45 7,32 2	2,81 4,24 2
Oth djus tme nts er a	-	-	-	-10, 521
Add ition s	698	-	698	-
Disp ls osa	-	-	-	-2,8 34
Tran slat ion adju stm ent	62,7 98	-4,2 28	58,5 70	71,2 56
Dep reci atio n	-47, 174	-21, 495	-68, 669	-
Imp airm ent	-	-	-	-
Inte rest exp ens e	-	-	-	134 ,811
Lea ents se p aym	-	-	-	-292 ,828
Clo sing bal e 30 .09. 202 1 anc	2,22 9,17 6	218 ,744	2,44 7,92 1	2,71 4,13 2

Impairment testing of Right-of-use assets

Based on value-in-use-calculations the Company has not recognized any impairment of Right-of-use assets. Further reference is made to Note 5 Fixed Assets.

Guarantee

Vessel lease liability is guaranteed by the Parent Company with MNOK 2,463.

The Parent Company has also guaranteed for a put option related to the leased vessel. The put is valued at MUSD 323 as of 30.09.2021.

Default put option

The lease agreement for Normand Maximus includes a default put option. The Company has received a waiver for the bareboat charter including the defalult put option of Normand Maximus. Year end 2020 the Company was in a contractual default. As the default was effective within the non-cancellable period and was not exercised at the end of 3Q 2021, the effect is not recognized in the balanse sheet.

Variable lease payments

The Company has two vessels on lease with variable lease payments. The total payments for 3Q 2021 was MNOK 12,3 (MNOK 0).

Note 9 - Tax expense

The Group's tonnage taxed companies have decided to exit the Norwegian Tonnage Tax Regime with effect from January 1st 2016. Amended tax returns for the period 2016-2018 have been fi led with Norwegian Tax Authorities. Based on the tax assessments received the Group has a loss carried forward of about NOK 12 billion. The corresponding deferred tax asset is not recognized in the accounts.

Taxes on ordinary result relates to local taxation outside Norway.

Note 10 - Subsequent events

On the 14 October 2021 Solstad Offshore, Aker Solutions and DeepOcean Norway joined forces to create Windstaller Alliance. The new partnership aims to provide the world's most cost-effi cient and complete product supply, fabrication and marine services offering within offshore wind. The alliance will also pursue other offshore renewables segments.

The Company has sold the PSV Far Swan 16 November 2021 resulting in an immaterial accounting effect in 4Q 21.

The Company has sold the PSV Rem Provider 12 November 2021 resulting in an immaterial accounting effect in 4Q 21.

-

-

The Company has sold the CSV Far Saga 8 November 2021 resulting in a minor gain in 4Q 21.

The Company has 5 October 2021 sold seven vessels for recycling. The vessels are Sea Tiger, Normand Atlantic, Normand Borg, Normand Neptun, Sea Pollock, Far Strider and Far Sovereign. The sales will result in an immaterial accounting effect in 4Q 21.

Note 8 - Interest bearing debt

The reinstated debt to credit institutions is recognized at its fair value. The interest rate for the refi nanced debt has at initial recognition been compared to current market terms according to IFRS 9. For the reinstated debt the Company concludes that the interest rate is below current market terms. Using the estimated market rate when measuring fair value of the reinstated debt a MNOK 1,066 reduction is observed. The difference between nominal- and fair value will be amortised, and presented as interest expense, over the period until fi nal maturity of the loans. The below table sets out the difference between nominal- and fair value at initial recognition, the amortization for the period and the remaining balance at reporting date.

Initi al re nitio n 20 .10.2 020 cog	-1,0 66,6 39
4Q 202 0 (*) Amo rtisa tion	54,6 15
Amo rtisa tion YT D 3Q 202 1 (*)	200 ,256
Unr eali sed y lo cur renc ss	53,5 44
Fair val djus tme nt 3 0.09 .202 1 ue a	-758 ,225

*Amortised cost is precented as part of Interest charges in the Comprehensive Income Statements

	202 1 30.0 9	202 0 30.0 9	202 0 31.1 2
Lon g te rm d ebt	17,6 63,1 14	4,08 2,78 2	17,1 43,0 21
Cur rent tion of l term deb t por ong	3,27 1,12 0	28,3 04,8 17	3,49 9,89 7
Fair Val djus tme nt ue a	758 ,225	-	1,01 2,02 5
Bala boo ked fi na cost nce nce	91,2 11	58,1 52	121, 870
Tota l int t be arin g de bt (* ) eres	21,7 83,6 70	32,4 45,7 52	21,7 76,8 13
Ban k de it pos	2,34 3,26 2	1,05 4,00 8	2,41 1,90 5
Net inte rest bea ring deb t	19,4 40,4 08	31,3 91,7 43	19,3 64,9 08

Long term debt is divided by 33% NOK and 67% USD. At the end of the quarter, fi xed interest agreement loans were entered into for around 4% of interest bearing debt.

Current portion of long term debt includes MNOK 2,463 reclassifi cation of lease obligation for Normand Maximus. The Company has received a waiver for the bareboat charter of Normand Maximus.

In 3Q 2020 comparative fi gures long term debt of about MNOK 25,000 was in accordance with IFRS classifi ed as Current portion of long term debt, due to the standstill agreements with the banks and bond holders where the covenant waiver period was less than 12 months.

*Inclusive recognized debt relating to IFRS 16 Leases MNOK 2,714 (MNOK 3,737), whereof MNOK 0 (MNOK 583) are leases from related parties, and debt to related parties MNOK 0 (MNOK 1,199).

Note 11 - Alternative performance measurement defi nitions

Solstad Offshore ASA has included the below Alternative Performance Measures (APM), which are commonly used in the business, as they are used internally by management to understand the Group's financial performance. Hence, it is deemed that the APM's also will provide useful information to the reader.

Operating margin - Operating result before depreciation in percentages of total operating income

EBITDA - Operating result before depreciation.

EBITDA adjusted - Operating result before depreciation and impairment adjusted for Joint Ventures, Associated Companies, excess values charter parties from mergers, leases and other non-recurring items

Adjusted Operating result before depreciations - Operating result before depreciation adjusted excess values charter parties from mergers and result from Joint Ventures

Earning on equity - Result before tax, in percentage of average equity, including minority interests

-

-

-

-

-

-

-

Earning on capital employed - Operating result plus interest income and result from associated company divided by average book shareholders' equity and interest-bearing debt

Current ratio - Current assets divided by current liabilities

Equity ratio - Booked equity including minority interests in percentage of total assets

Earnings per share - Result for the period for the Group divided by weighted average number of shares at the end of the reporting period, adjusted for treasury shares

Comprehensive income per share – Comprehensive income for the period for the Group divided by weighted average number of shares at the end of the reporting period, adjusted for treasury shares

Equity per share - Shareholders' equity divided by outstanding number of shares at the end of the reporting period

Working capital – Current assets less current liabilities, excluding current portion of long-term debt

Interest-bearing debt – Current and long-term interest-bearing liabilities

Net interest-bearing debt – Interest-bearing liabilities less bank deposits

Our Global Footprint

Vessels in operation during quarter

South Americas

(Brazil & Argentina)

6 AHTS | 5 PSV | 4 CSV Oil & Gas

Americas

(USA, Mexico, Gulf)

2 CSV Oil & Gas

Offi ces

Solstad Offshore ASA

Nesavegen 39 4280 Skudeneshavn Norway

Postal address: P.O. Box 13 4297 Skudeneshavn Norway

Telephone: +47 52 85 65 00 Email: contact@solstad.com

www.solstad.com