Subsea 7 — Earnings Release 2016

Apr 28, 2016

Subsea 7 S.A. Announces First Quarter 2016 Results

Subsea 7 S.A. Announces First Quarter 2016 Results

Luxembourg - 28 April 2016 - Subsea 7 S.A. (the Group)

(Oslo Børs: SUBC, ADR: SUBCY) announced today results

for the first quarter which ended 31 March 2016.

Jean Cahuzac, Chief Executive Officer, said:

'Reported revenue was $746 million in the first

quarter 2016, 37% lower than the prior year period,

due to the reduction of SURF project activity

worldwide. Adjusted EBITDA was $284 million with an

Adjusted EBITDA margin of 38%, which was significantly

higher than 2015 despite the lower revenues. This

performance benefitted from good project execution

overall and successful risk mitigation measures on

projects which were nearing completion. It also

reflected the impact of the Group's cost reduction and

resizing plan that was implemented in 2015.

Active vessel utilisation was 71% with one chartered

vessel released in the quarter and seven owned vessels

stacked at quarter end. Total vessel utilisation in

the first quarter was 55% due to low levels of

activity.

Order intake of $1.1 billion resulted in backlog

increasing to $6.5 billion as at 31 March. Announced

awards in the quarter comprised the West Nile Delta

Phase 2 project, offshore Egypt, the largest project

awarded to Subsea 7 since 2011, and two Life of Field

awards, offshore UK.

Cash and cash equivalents increased to $1.1 billion as

at 31 March. Net cash increased to $633 million,

driven by $281 million of cash generated from

operating activities and a continued focus on working

capital management. The Group extended its revolving

credit facility from $500 million to $750 million

during the first quarter, taking total undrawn credit

facilities to $1.1 billion at the quarter end.

In the Northern Hemisphere and Life of Field Business

Unit, activity remained low in the North Sea and for

the Life of Field and i-Tech business, reflecting

seasonal weather conditions and a more challenging

market. The Aasta Hansteen, Martin Linge, Maria and

Culzean projects progressed with preparations for the

offshore campaigns scheduled for the summer. In the US

Gulf of Mexico offshore activity continued

successfully on the Dalmatian project, which was

substantially completed in the first quarter, and on

the Holstein Deep and Coulomb Phase 2 projects.

In the Southern Hemisphere and Global Projects

Business Unit, several large projects reached the

final stages of execution with reduced risk profiles

and costs. The BC-10 Phase 3 project, offshore Brazil,

and OFON 2 project, offshore Nigeria were

substantially completed and significant progress was

made on the TEN project, offshore Ghana, and the

Persephone Phase 2 project, offshore Australia.

Offshore Egypt, Seven Borealis completed pipelay

operations on the East Nile Delta project and the West

Nile Delta Phase 1 project progressed with engineering

and fabrication. The active PLSVs under long-term

contracts with Petrobras recorded high levels of

utilisation, including Seven Rio, which commenced its

five-year contract in February as planned.

The outlook remains challenging and the timing of new

contract awards is still uncertain as clients continue

to postpone capital investment decisions in the

current market environment. Subsea 7 is successfully

working with clients and alliance partners to drive

down the costs of development with innovative and cost

effective solutions that will enable more projects to

progress despite the low oil price.

Full year 2016 revenue is expected to be significantly

lower than in 2015 and Adjusted EBITDA percentage

margin is expected to be lower compared to 2015. In

this context, additional cost reduction measures will

be implemented during the year.

The fundamental long-term outlook for subsea field

developments remains positive and industry activity is

expected to improve when the oil and gas markets

rebalance.'

Conference Call Information

Lines will open 15 minutes prior to conference call.

Date: 28 April 2016, 12:00 UK Time

Conference ID: 14251567#

International Dial In: +44 20 3139 4830

For further information, please contact:

Isabel Green, Investor Relations Director

email: isabel.green@subsea7.com

Telephone: +44 (0) 20 8210 5568

Special Note Regarding Forward-Looking Statements

Certain statements made in this announcement may

include 'forward-looking statements'. These statements

may be identified by the use of words

like 'anticipate', 'believe', 'could', 'estimate', 'exp

ect', 'forecast', 'intend', 'may', 'might', 'plan', 'pr

edict', 'project', 'scheduled', 'seek', 'should', 'will

', and similar expressions. The forward-looking

statements reflect our current views and are subject

to risks, uncertainties and assumptions. The principal

risks and uncertainties which could impact the Group

and the factors which could affect the actual results

are described but not limited to those in the 'Risk

Management' section in the Group's Annual Report and

Consolidated Financial Statements 2015. These factors,

and others which are discussed in our public

announcements, are among those that may cause actual

and future results and trends to differ materially

from our forward-looking statements: actions by

regulatory authorities or other third parties; our

ability to recover costs on significant projects; the

general economic conditions and competition in the

markets and businesses in which we operate; our

relationship with significant clients; the outcome of

legal and administrative proceedings or governmental

enquiries; uncertainties inherent in operating

internationally; the timely delivery of vessels on

order; the impact of laws and regulations; and

operating hazards, including spills and environmental

damage. Many of these factors are beyond our ability

to control or predict. Other unknown or unpredictable

factors could also have material adverse effects on

our future results. Given these factors, you should

not place undue reliance on the forward-looking

statements