REPORT FOR THE SECOND QUARTER 2013 AND THE FIRST HALF YEAR 2013

Highlights 2Q 13:

• Operating revenues were NOK 2 607 million (NOK 2 390 million)
• Operating result before depreciation (EBITDA) was NOK 1 138 million (NOK 984 million)
• Operating result (EBIT) was NOK 642 million (NOK 525 million)
• Net result after tax and discontinued operations was NOK 550 million (NOK 498 million)
• Majority’s share of net result was NOK 273 million (NOK 173 million)
• Earnings per share were NOK 8.4 (NOK 5.4)
• Shareholders of Fred. Olsen Production ASA have received a cash offer from Yinson Production Ltd. 
   

Financial information

As a consequence of Bonheur ASA holding more than 50% of the shares of Ganger Rolf ASA, Ganger Rolf ASA is fully consolidated for accounting purposes as a subsidiary of Bonheur ASA. As Bonheur ASA and Ganger Rolf ASA have a joint ownership (50% / 50%) of their major investments, the ownership structure entails full consolidation for accounting purposes of a number of companies. The main business segments comprise Offshore Drilling, Renewable Energy, Cruise, Shipping / Offshore wind and Other Investments.

Following the announced offering from Yinson Production Ltd., to acquire all shares of Fred. Olsen Production ASA the business segment Floating Production has per 30thJune been reclassified as an investment held for sale in the consolidated financial position, and accordingly presented as discontinued operations in the consolidated income statement. Corresponding figures for last year periods have been restated for the income statement.

The Group of companies´ operating revenues amounted to NOK 2 607 million (NOK 2 390 million) in the quarter. The increase in revenues compared with the correspondingquarter last year is mainly related to higher income within the segments Offshore Drilling, Renewable Energy and Shipping / Offshore wind. Offshore Drilling generated operating revenues of NOK 1 788 million (NOK 1 742 million), Renewable Energy had operating revenues of NOK 138 million (NOK 81 million) and Shipping / Offshore wind NOK 330 million (NOK 148 million). Cruise had operating revenues of NOK 340 million (NOK 391 million).
Operating result before depreciation (EBITDA) in the quarter were NOK 1 138 million (NOK 984 million). The increase in EBITDA compared with 2nd quarter 2012 of NOK 154 million is mainly due to higher EBITDA within Renewable Energy and Shipping / Offshore wind. Renewable Energy achieved EBITDA of NOK 94 million (NOK 35 million) and Shipping /Offshore wind NOK 127 million (negative NOK 4 million) in the quarter. EBITDA within Offshore Drilling were NOK 935 million (NOK 947 million) and EBITDA within the Cruise segment were NOK 9 million (NOK 37 million). Depreciation in the quarter was NOK 497 million (NOK 459 million).

Operating result (EBIT) for the quarter was NOK 642 million (NOK 525 million).

Net financial items were positive NOK 167 million (negative NOK 34 million). Net interest costs in the quarter were NOK 123 million (NOK 109 million) and net currency gain were NOK 137 million (NOK 126 million). Net unrealized gain related to revaluation of financial instruments amounted to NOK 109 million (negative NOK 32 million). Received dividend from Other investments (IT Fornebu Properties AS) was NOK 65 million in the quarter.

The Group of companies´ result after estimated tax in the quarter was NOK 794 million (NOK 504 million).

On a 100% basis the result from discontinued operations was negative NOK 245 million inclusive a loss of NOK 260 million as the booked equity value of FOP was higher than the offered sales price for the shares. The Company’s share of the result from discontinued operations was negative NOK 152 million inclusive a loss of NOK 160 million due to the difference between the cash offer and the booked value of the shares. For further details see note 7.

Net result after tax and discontinued operations in the quarter was NOK 550 million, of which NOK 273 million relate to the majority interests (NOK 173 million). The minority interests´ share of net result in the quarter was NOK 277 million (NOK 325 million). Minority interests´ share of the results are higher than the share of the majorities’, mainly as a consequence of the minorities’ share of the result in Fred. Olsen Energy ASA.

Revenues year to date were NOK 4 870 million (NOK 4 778 million) while EBITDA year to date were NOK 1 978 million (NOK 1 964 million). Operating result (EBIT) year to date was NOK 1 010 million
(NOK 1 059 million) Net financial items were positive NOK 125 million (negative NOK 242 million) and net result after estimated tax was NOK 1 094 million (NOK 728 million). Result from discontinued operations year to date was negative NOK 224 million. Net result after tax and discontinued operations was NOK 869 million (NOK 726 million), of which NOK 352 million (NOK 219 million) relate to the majority interests.

Other information

Capital and financing

As per the 2ndquarter, investments were mainly related to Offshore Drilling (FOE), Renewable Energy (FOR) and Fred. Olsen Windcarrier AS.

Within FOE, capital expenditures first half year amounted to NOK 576 million, related to newbuilds, class renewal surveys and general upgrades.

Fred. Olsen Windcarrier had capital expenditures of NOK 235 million related to newbuilds.

FOR had capital expenditures of NOK 341 million during the first half year, mainly related to the construction of Mid Hill and Rothes II wind farms.

In total the Group of companies’ investments net of intra-group eliminations, amounted to NOK 1 165 million year to date.

Gross interest bearing debt of the Group of companies as per end of 2ndquarter was NOK 12 007 million, a decrease of NOK 475 million since year end 2012. Cash and cash equivalents amounted to NOK 3 663 million, a decrease of NOK 364 million since year-end 2012. Net interest bearing debt of the Group of companies at the end of the 1sthalf year was NOK 8 344 million, a decrease of NOK 111 million since year end 2012. The equity to asset ratio was 40% at the end of the second quarter, which is unchanged from year-end 2012. 

Risks

The main risk items which may affect the results negatively for the remainder of the year comprise adverse market developments, energy prices, operational issues related to income, operating costs and HSE incidents within the various business segments, negative foreign exchange developments and increased interest rates.

Cash offer for Fred. Olsen Production ASA (FOP)

A cash consideration of NOK 9.40 per share has been offered for the shares of FOP, implying a total consideration for all shares of approximately NOK 996 million also taking into account that the shares of the Company as from 30 May 2013 have been trading ex a dividend of NOK 0.50 per share. The Offer represents a premium of 5.1% over the closing price of the shares on 7 June 2013 and a premium of 43.2% over the dividend adjusted closing price of the share the day before the announcement of the strategic review process by the Board of Directors in FOP.

Dividend / Annual General Meeting in Bonheur ASA

At the Annual General Meeting in Bonheur ASA on 30thMay 2013, the proposed dividend payment of NOK 7.00 per share was approved. The dividend was paid on 25thJune, amounting to NOK 285.5 million in total.

Subsequent events

In July 2013 a subsidiary; MOPU AS, was notified by the tax authorities of a possible change in the taxable income for 2005 – 2006. The tax authorities indicated a potential ordinary tax claim of totally NOK 158 million related to the reorganization of the company in 2005. The tax claim will be challenged