Subsea 7 — Earnings Release 2022

Jul 28, 2022

Subsea 7 S.A. Announces Second Quarter and Half Year 2022 Results

Subsea 7 S.A. Announces Second Quarter and Half Year 2022 Results

Luxembourg - 28 July 2022 - Subsea 7 S.A. (the Group) (Oslo Børs: SUBC, ADR:

SUBCY, ISIN: LU0075646355) announced today results for the second quarter and

first half of 2022 which ended 30 June 2022.

Second quarter highlights

* Adjusted EBITDA of $134 million, up 48% year-on-year, resulting in a margin

of 11%

* Order intake of $2.1 billion, equating to a book-to-bill of 1.6 times

* Backlog of $7.8 billion, of which 10% is in Renewables, with $2.5 billion to

be executed in 2022

* Cash and cash equivalents of $464 million and net debt (including lease

liabilities) of $88 million

* Renewal of Subsea Integration Alliance for a further seven years

Second Quarter Half Year

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For the period (in $

millions, except

Adjusted EBITDA margin Q2 2022 Q2 2021 1H 2022 1H 2021

and per share data) Unaudited Unaudited Unaudited Unaudited

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Revenue 1,247 1,198 2,441 2,194

Adjusted EBITDA((a)) 134 90 220 193

Adjusted EBITDA

margin((a)) 11% 8% 9% 9%

Net operating

income/(loss) 18 (28) (13) (37)

Net income/(loss) 22 (13) 10 (12)

Earnings per share -

in $ per share

Basic 0.14 (0.04) 0.09 (0.03)

Diluted((b)) 0.14 (0.04) 0.09 (0.03)

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30 Jun 2022 31 Mar 2022

At (in $ millions) Unaudited Unaudited

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Backlog((c))     7,796 7,295

Book-to-bill

ratio((c)) 1.6 1.0

Cash and cash

equivalents 464 500

Borrowings     (368) (379)

Net cash excluding

lease liabilities((d)) 96 121

Net debt including

lease liabilities((d)) (88) (98)

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(a) For explanations and reconciliations of Adjusted EBITDA and Adjusted EBITDA

margin refer to Note 8 'Adjusted EBITDA and Adjusted EBITDA margin' to the

Condensed Consolidated Financial Statements.

(b) For the explanation and a reconciliation of diluted earnings per share refer

to Note 7 'Earnings per share' to the Condensed Consolidated Financial

Statements.

(c) Backlog is a non-IFRS measure. Book-to-bill ratio represents total order

intake divided by revenue recognised in the second quarter. Comparative figure

is for the quarter ended 31 March 2022.

(d) Net cash/(debt) is a non-IFRS measure and is defined as cash and cash

equivalents less borrowings.

John Evans, Chief Executive Officer, said:

In the second quarter of 2022, Subsea 7 delivered a strong performance in Subsea

and Conventional, while the Renewables business unit performed in line with

June's trading update. Since the first quarter, the industry's challenges

relating to the supply chain and raw material price inflation have stabilised,

allowing a number of projects to proceed. Order intake in the quarter was robust

at $2.1 billion resulting in growth in our backlog to $7.8 billion. In addition,

our pre-backlog (subject to FID((1))) was over $1 billion, reflecting offshore

wind projects in the UK that we expect to convert to firm awards by early 2023.

Both our core markets - subsea and offshore fixed wind - continue to improve,

with positive momentum in pricing and risk allocation. During the quarter, we

extended the Subsea Integration Alliance with Schlumberger for a further seven

years. Subsea Integration Alliance has become a market leader in integrated SPS-

SURF projects and we look forward to further growth. Overall, Subsea 7 is well-

positioned to benefit from these positive market dynamics, and to deliver on a

strategy that combines capital returns and growth over the long term.

Operational highlights

In the second quarter the Subsea and Conventional business unit made good

progress on its portfolio, with projects completing in the Gulf of Mexico and

Saudi Arabia. Activity remained high in the Gulf of Mexico, with Seven Arctic,

Seven Navica, Seven Oceans and Seven Vega active on Anchor, Jack St Malo 4, Mad

Dog 2, and Vito. In northern Europe, Seven Oceans worked on the Johan Sverdrup

Phase 2, Balmoral and Pierce fields. Procurement neared completion for the fast-

tracked Sakarya integrated project in Turkey, and the shallow water section of

pipelay commenced.

In the Renewables business unit, foundation installation and cable lay work

continued, as planned, on the Seagreen project in the UK. At the end of the

quarter, 30 of 114 foundations and 21 cables had been installed. In Taiwan,

Seaway Yudin worked on the Formosa 2 project while, in the Netherlands, Seaway

Strashnov, Seaway Aimery and Seaway Moxie worked on the Hollandse Kust Zuid

project. Both Formosa 2 and Hollandse Kust Zuid progressed in accordance with

the execution plan announced in June, and they remain on track for completion in

August and September, respectively.

Second quarter financial review

Second quarter revenue of $1.2 billion increased by 4% compared to the prior

year period, reflecting growth in Subsea and Conventional offset by lower

revenues in Renewables primarily driven by the phasing of the Seagreen project.

Adjusted EBITDA of $134 million was up 48% year-on-year driven by a strong

margin in Subsea and Conventional, partly offset by losses in Renewables. Net

operating income was $18 million after depreciation and amortisation charges of

$116 million. Net income for the quarter was $22 million, after taxation of $36

million and favourable other gains and losses of $47 million, including net

foreign exchange gains of $44 million.

Net cash generated from operations was $94 million including a $63 million

adverse movement in net working capital. Net cash used in investing activities

was $50 million, including $52 million related to purchases of property, plant

and equipment. Net cash used in financing activities was $72 million which

included dividends of $32 million. Overall, cash and cash equivalents decreased

by $36 million from 31 March 2022 to $464 million with net debt of $88 million,

including lease liabilities of $184 million. As communicated in the Seaway 7

trading update in June 2022, progress on Seaway Alfa Lift build has encountered

delays. The root cause of the delays in the delivery of the vessel is due to the

status of the mission equipment, engineering and procurement. These conditions,

attributable to OHT ASA, were present on 1 October 2021, the date of the

business combination, as a result, the adverse financial impact has been

accounted for as an adjustment to the transaction's purchase price allocation.

Order intake

Order intake was $2.1 billion comprising new awards of $1.7 billion, escalations

of approximately $400 million, and adverse foreign exchange movements of

approximately $300 million, resulting in a book-to-bill ratio of 1.6 in the

quarter. Backlog at the end of June was $7.8 billion, of which $2.5 billion is

expected to be executed during the remainder of 2022.

Outlook for full year 2022

We continue to expect that revenue and Adjusted EBITDA will be broadly in line

with 2021. Tendering in the subsea market remains high and the pricing

environment continues to improve. In fixed offshore wind, contract pricing and

risk allocation have improved and should contribute to robust long-term margins

and returns.

(()(1)()) Final investment decision by the clients

Conference Call Information

Date: 28 July 2022

Time: 11:00 UK Time

Access the webcast at subsea7.com (https://edge.media-server.com/mmc/p/sdhad4b2)

or https://edge.media-server.com/mmc/p/5qxr3swf

Register for the conference call at

https://register.vevent.com/register/BI519e84258b954cb6af64f7a30949e0c8

For further information, please contact:

Katherine Tonks

Head of Investor Relations

Email: katherine.tonks@subsea7.com (mailto:katherine.tonks@subsea7.com)

Telephone: +44 20 8210 5568

Special Note Regarding Forward-Looking Statements

Certain statements made in this announcement may contain 'forward-looking

statements' (within the meaning of the safe harbour provisions of the U.S.

Private Securities Litigation Reform Act of 1995). These statements relate to

our current expectations, beliefs, intentions, assumptions or strategies

regarding the future and are subject to known and unknown risks that could cause

actual results, performance or events to differ materially from those expressed

or implied in these statements. Forward-looking statements may be identified by

the use of words such as 'anticipate', 'believe', 'estimate', 'expect',

'future', 'goal', 'intend', 'likely' 'may', 'plan', 'project', 'seek', 'should',

'strategy' 'will', and similar expressions. The principal risks which could

affect future operations of the Group are described in the 'Risk Management'

section of the Group's Annual Report and Consolidated Financial Statements.

Factors that may cause actual and future results and trends to differ materially

from our forward-looking statements include (but are not limited to): (i) our

ability to deliver fixed price projects in accordance with client expectations

and within the parameters of our bids, and to avoid cost overruns; (ii) our

ability to collect receivables, negotiate variation orders and collect the

related revenue; (iii) our ability to recover costs on significant projects;

(iv) capital expenditure by oil and gas companies, which is affected by

fluctuations in the price of, and demand for, crude oil and natural gas; (v)

unanticipated delays or cancellation of projects included in our backlog; (vi)

competition and price fluctuations in the markets and businesses in which we

operate; (vii) the loss of, or deterioration in our relationship with, any

significant clients; (viii) the outcome of legal proceedings or governmental

inquiries; (ix) uncertainties inherent in operating internationally, including

economic, political and social instability, boycotts or embargoes, labour

unrest, changes in foreign governmental regulations, corruption and currency

fluctuations; (x) the effects of a pandemic or epidemic or a natural disaster;

(xi) liability to third parties for the failure of our joint venture partners to

fulfil their obligations; (xii) changes in, or our failure to comply with,

applicable laws and regulations (including regulatory measures addressing

climate change); (xiii) operating hazards, including spills, environmental

damage, personal or property damage and business interruptions caused by adverse

weather; (xiv) equipment or mechanical failures, which could increase costs,

impair revenue and result in penalties for failure to meet project completion

requirements; (xv) the timely delivery of vessels on order and the timely

completion of ship conversion programmes; (xvi) our ability to keep pace with

technological changes and the impact of potential information technology, cyber

security or data security breaches; and (xvii) the effectiveness of our

disclosure controls and procedures and internal control over financial

reporting. Many of these factors are beyond our ability to control or predict.

Given these uncertainties, you should not place undue reliance on the forward-

looking statements. Each forward-looking statement speaks only as of the date of

this announcement. We undertake no obligation to update publicly or revise any

forward-looking statements, whether as a result of new information, future

events or otherwise.