Operational and financial update Q2 2020
Operational and financial update Q2 2020

Operational and financial update Q2 2020

Operational

The fleet utilisation rate in the second quarter of 2020 was 6.5 per cent (Q2 2019: 71.6 per cent).

Prosafe refers to the press release from 9 April 2020 regarding discussions with clients about current and upcoming contracts in light of COVID-19 and the oil price collapse. Certain discussions remain ongoing. Please see status and update per vessel below.

The Safe Zephyrus was ready to mobilize from Norway to support EnQuest’s Thistle project, but was instructed by EnQuest on 20 March 2020 not to mobilize. Prosafe has claimed the full contract value, ca. USD 2 million. Thereafter, Safe Zephyrus was scheduled to mobilise to Shell at Shearwater to commence a 110-day contract with a 30-day option in Q2 2020. Prosafe has been informed by Shell that this project will not be performed in 2020 and discussions with the client are ongoing. The vessel was currently laid up at Averøy yard in Norway.

Safe Caledonia was laid up in the UK. The vessel was initially prepared to commence a 162-day contract with a 30-day option for Total at the Elgin complex in the UK sector of the North Sea from mid-April 2020, but Prosafe and Total have agreed to defer this project by one year.

Safe Notos has been operating on a three-year and 222-day contract for Petrobras in Brazil since December 2016. Safe Eurus has been providing safety and maintenance support to Petrobras during a three-year contract since November 2019. On 21 March 2020, client personnel on both vessels were demobilised and the vessels were moved closer to shore. During this period, the vessels were on 95% stand-by day rate. From early April 2020, Prosafe has been requested to agree with a suspension of the contract for a period of up to 120 days during which period no income was recognised, but all logistical services, fuel and catering support will continue to be provided by Petrobras, and any days of suspension will be added to the firm period of the contract. Commercial and payment terms related to the recommencement are subject to ongoing discussions.

Safe Concordia completed the contract for Equinor at the Peregrino FPSO in the Campos Basin offshore Brazil on 11 May 2020 and is presently laid up in Brazil available for charter. The vessel was on full day rate during the operational period in the quarter.

Safe Scandinavia, Safe Boreas and Regalia were idle in the quarter and were laid up in Norway.  Regalia is being marketed for recycling.

Although the impact from Covid-19 on the macro environment has been challenging, the company has successfully implemented proper safety measurements at work places and vessels to protect people and assets, as well as a number of cost-saving initiatives to protect liquidity.

Financial

In light of the commercial discussions with clients as outlined above, there is uncertainty related to the extent to which the order backlog will materialize in 2020, as well as to the final outcome of these negotiations.

Please refer to separate press release from 31 July 2020 regarding the ongoing discussion with lenders about a long-term financial solution for the company.

Prosafe is a leading owner and operator of semi-submersible accommodation vessels. The company is listed on the Oslo Stock Exchange with ticker code PRS. For more information, please refer to www.prosafe.com

Stavanger, 3 August 2020
Prosafe SE

For further information, please contact:

Jesper K. Andresen, CEO
Phone: +47 51 65 24 30 / +47 907 65 155

Stig Harry Christiansen, Deputy CEO and CFO
Phone: +47 51 64 25 17 / +47 478 07 813

This information is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act