Subsea 7 S.A.

Welcome everyone and thank you for joining us. With me on the call today are John Evans, our CEO, Mark Foley, our CFO, and Stuart Fitzgerald, CEO of Seaway7. The results press release is available to download on our website along with the slides we'll be using during today's call. Please note that some of the information discussed on the call today will include forward-looking statements that reflect our current views. These statements involve risks and uncertainties that may cause actual results or trends to differ materially from our forecasts. For more information, please refer to the risk factors discussed in Subsea 7's 2023 annual report or today's quarterly press release. I'll now turn the call over to John.

Thank you, Catherine, and good afternoon, everyone. I will start with a summary of the second quarter before passing over to Mark for more details of the financial results. Turning to slide three, Subsea 7 delivered year-on-year and with a margin of 17%. We're on track to meet EBITDA guidance, which has been revised upwards by 5%. The second quarter was a record for Subsea 7, both in terms of order intake and backlog. The addition of more high-quality projects support our expectations of strong margins in the remainder of 2024 and over 20% in 2026. Our tendering pipeline in both subsea and wind remains robust, and we're confident in a positive outlook for both businesses. Turning to slide four, order intake in the second quarter was $4 billion, reflecting new awards in Brazil, Turkey, UK, and the Gulf of Mexico. Our book to build for the quarter was 2.3 times and 1.7 times first half. With a high book-to-bill, we continued to drive strong growth in our backlog, and at the end of the first half, we had $12.5 billion of firm work, a record high. Slide 6 shows the backlog by business units. After recent awards and sub-team conventional, including Bujo four billion dollars already secured for 2026 and beyond in renewables the backlog is roughly flat as we remain selective in our tendering approach to support future margins and returns and now i'll pass over to mark to run through the financial results thank you john and good afternoon everyone i'll begin the financial performance review with some details of group and business unit performance in the quarter

before returning to the group cash flow and financial guidance for 2024. Slide seven summarizes the group's second quarter results. Revenue increased to $1.7 billion, up 15% compared to the second quarter of 2023, largely driven by a subseeing convention. Adjusted EBITDA of $292 million was up 80% compared with the prior year, and our margin increased by over 600 basis points to 17%. Net finance costs of $24 million, a net foreign exchange loss of $8 million, and taxation of $41 million resulted in net income of $63 million compared with $14 million in the prior year period. I'll now discuss the drivers of the group's performance in the next few slides. Slide eight presents the key metrics for subsea and conventional. Revenue was $1.4 billion, up 21% year-on-year, reflecting good progress on fabrication of ervigra, wick, and bintan spillbases, as well as the execution of offshore scopes in Guyana, Brazil, Australia, and Norway. Adjusted EBITDA was $247 million, equating to a margin of 17.2%, an increase of approximately 700 basis points from the prior year. This result was underpinned by the continued mixed shift to higher margin projects, high utilization of the global enabler vessels, as well as a $9 million net income contribution from one subsea. Net operating income was $126 million, compared to a loss of $10 million, in the same quarter last year. Selected renewables performance metrics are shown in slide 9. Revenue was $281 million, broadly flat year-on-year, reflecting ongoing activity installing foundations and transition pieces at Dogger Bank, as well as cable lay projects in the UK and Taiwan, and our first turbine installation project in Germany. Adjusted EBITDA was $38 million, resulting in a margin of 13.6%. We continue to expect the renewables business unit to generate a double-digit adjusted EBITDA margin in the full year. Slide 10 shows a cash waterfall for the second quarter. Net cash generated by operating activities was $187 million, which included a modest $12 million adverse movement in working capital. Net cash used in investing activities was $202 million, including capital expenditure of $55 million, and the second of two payments for our investment in 1C amounting to $153 million. Net cash used in financing activities was $213 million, which included dividend payments of $82 million, share repurchases of $19 million, and lease payments of $55 million. Restricted cash increased by $83 million related to the purchase of African Inspiration, a 250-pound crane-class construction vessel. The purchase was completed on the 18th of July, and the vessel will be renamed 7 Merlin. At the end of the quarter, cash and cash equivalents was $290 million, and net debt was $1 billion, which included lease liabilities of $533 million. The group had liquidity of $1.1 billion at the quarter end, which included $860 million of committed unutilized borrowing facilities. At the 24th of July, the company had utilized $52 million or 65% of the $80 million allocated to share repurchases as part of their $250 million shareholder returns in 2024. To conclude, Slide 11 shows our guidance for the full year. We have raised our expectation for revenue and adjusted EBITDA slightly, as well as reflecting the purchase of 7 Merlin in capital expenditure. In 2024, we now expect revenue to be in a range between 6.5 and 6.8 billion dollars, with adjusted EBITDA being between 1 and 1.05 billion dollars. This reflects the good progress on our existing portfolio projects. Our capital expenditure guidance now includes the purchase of 7 Merlin of $83 million. The underlying capital expenditure guidance has not changed. I will now pass you back to John.