siem offshore inc. - swedbanki/@sc/@all/@lci/... · siem offshore inc. rights offering of...
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Siem Offshore Inc. Rights Offering of 454,430,000 New Shares Subscription Price: NOK 1.80 per New Share
Subscription Period: From 19 August 2015 to 16:30 hours (CET) on 2 September 2015
Trading in Subscription Rights: From 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015
________________________ Siem Offshore Inc. (the "Company", and, together with its consolidated subsidiaries, "Siem Offshore" or the "Group") is offering 454,430,000 new shares in the Company (the "New Shares") with a nominal value of USD 0.01 each, at a subscription price of NOK 1.80 per New Share (the "Subscription Price"). Holders of the Company’s shares registered in the Norwegian Central Securities Depository (the "VPS") as of 18 August 2015 (the "Existing Shareholders") are being granted transferable subscription rights (the "Subscription Rights") that, subject to applicable law, provide preferential rights to subscribe for and be allocated New Shares at the Subscription Price (such offering of New Shares upon the exercise of Subscription Rights, the "Rights Offering"). Each Existing Shareholder will be granted 1.1724 Subscription Rights for each share registered as held by such Existing Shareholder as of 18 August 2015 (the "Record Date"). Each Subscription Right will give the right to subscribe for and be allocated one New Share. The subscription period commences on 19 August 2015 and expires at 16:30 hours, Central European Time ("CET"), on 2 September 2015 (the "Subscription Period"). The Subscription Rights will be listed and tradable on the Oslo Børs (the "Oslo Stock Exchange") under the ticker code SIOFF T from 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015. Subscription Rights that are not used to subscribe for New Shares before the expiry of the Subscription Period, or that are not sold before the end of trading on the Oslo Stock Exchange on 31 August 2015, will have no value and will lapse without compensation to the holder. After the expiry of the Subscription Period, any New Shares that have not been subscribed for and allocated in the Rights Offering will be subscribed and paid for at the Subscription Price by Siem Europe S.a r.l (the "Underwriter"), subject to the terms and conditions of the Underwriting Agreement between the Company and the Underwriter dated 11 August 2015 (the "Underwriting Agreement"). The Company is not taking any action to permit a public offering of the Subscription Rights or the New Shares in any jurisdiction outside of Norway. The New Shares are being offered only in those jurisdictions in which, and only to those persons to whom, offers and sales of the New Shares (pursuant to the exercise of the Subscription Rights or otherwise) may lawfully be made. The Subscription Rights and the New Shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "US Securities Act"), or under the securities laws of any state of the United States and may not be offered or sold (i) within the United States, except in transactions exempt from registration under the US Securities Act, or (ii) outside the United States, except in offshore transactions in reliance on Regulation S. The Rights Offering will not be made to persons who are residents of Australia, Canada, Hong Kong or Japan or in any jurisdiction in which such offering would be unlawful. For more information regarding restrictions in relation to the Rights Offering pursuant to this Prospectus, please see Section 14, "Selling and transfer restrictions" . Investing in the Company’s shares (the "Shares"), including the New Shares, and trading in the Subscription Rights involves certain risks. See Section 2, "Risk Factors" beginning on page 13. The Company’s existing shares (the "Existing Shares") are listed on the Oslo Stock Exchange under the ticker code "SIOFF".
Lead Manager Swedbank
Receiving Agent
DNB Markets
The date of this Prospectus is 17 August 2015
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IMPORTANT INFORMATION This Prospectus has been prepared solely for use in connection with the Rights Offering and the Listing. Please see Section 16, "Definitions and glossary" for definitions of terms used throughout this Prospectus. The Prospectus has been prepared to comply with the Norwegian Securities Trading Act of 29 June 2007 No. 75 (the "Norwegian Securities Trading Act") and related secondary legislation, including the Commission Regulation (EC) No. 809/2004 implementing Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 regarding information contained in prospectuses, as amended, and as implemented in Norway (the "Prospectus Directive"). This Prospectus has been prepared solely in the English language. The Financial Supervisory Authority of Norway (the "Norwegian FSA") has reviewed and approved this Prospectus in accordance with sections 7-7 and 7-8 of the Norwegian Securities Trading Act. The Norwegian FSA has not controlled or approved the accuracy or completeness of the information given in this Prospectus. The approval given by the Norwegian FSA only relates to the information included in accordance with pre-defined disclosure requirements. The Norwegian FSA has not made any form of control or approval relating to corporate matters described or referred to in this Prospectus. The Company has engaged Swedbank as Manager and DNB Markets as Receiving Agent in the Rights Offering. Swedbank and DNB Markets are acting for the Company and no one else in relation to the Rights Offering or the Listing. Swedbank and DNB Markets will not be responsible to anyone other than the Company for providing the protections afforded to their clients or for providing advice in relation to the listing. No person is authorised to give information or to make any representation concerning the Group or in connection with the Rights Offering other than as contained in this Prospectus. If any such information is given or made, it must not be relied upon as having been authorised by the Company, the Manager or the Receiving Agent or by any of the affiliates, advisors or selling agents of any of the foregoing. The distribution of this Prospectus and the offer and sale of the New Shares may be restricted by law in certain jurisdictions. This Prospectus does not constitute an offer of, or an invitation to purchase, any of the New Shares in any jurisdiction in which such offer or sale would be unlawful. No one has taken any action that would permit a public offering of the Shares to occur outside of Norway. Accordingly neither this Prospectus nor any advertisement or any other offering material may be distributed or published in any jurisdiction except under circumstances that will result in compliance with applicable laws and regulations. Persons in possession of this Prospectus are required to inform themselves about, and to observe, any such restrictions. In addition, the Shares are subject to restrictions on transferability and resale in certain jurisdictions and may not be transferred or resold except as permitted under applicable securities laws and regulations. Investors should be aware that they may be required to bear the financial risks of this investment for an indefinite period of time. Any failure to comply with these restrictions may constitute a violation of applicable securities laws. For further information on the sale and transfer restrictions of the Shares, see Section 14, "Selling and transfer restrictions". The information contained herein is current as at the date hereof and subject to change, completion and amendment without notice. In accordance with section 7-15 of the Norwegian Securities Trading Act, significant new factors, material mistakes or inaccuracies relating to the information included in this Prospectus, which are capable of affecting the assessment of the Shares between the time of approval of this Prospectus by the Norwegian FSA and the Listing of the Shares on the Oslo Stock Exchange, will be included in a supplement to this Prospectus. The publication of this Prospectus shall not under any circumstances create any implication that there has been no change in the Group's affairs or that the information herein is correct as of any date subsequent to the date of this Prospectus. Neither the Company, the Manager nor the Receiving Agent, or any of their respective affiliates, representatives, advisers or selling agents, are making any representation to any subscriber or purchaser of New Shares regarding the legality or suitability of an investment in the New Shares. Each investor should consult with his or her own advisors as to the legal, tax, business, financial and related aspects of a subscription or purchase of the New Shares. In the ordinary course of their businesses, the Manager and the Receiving Agent and certain of their respective affiliates have engaged, and may continue to engage, in investment and commercial banking transactions with the Company and its subsidiaries. This Prospectus and the terms and conditions of the Rights Offering as set out herein shall be governed by and construed in accordance with Norwegian law. The courts of Norway, with Oslo as legal venue, shall have exclusive jurisdiction to settle any dispute which may arise out of or in connection with the Rights Offering or this Prospectus.
NOTICE TO NEW HAMPSHIRE RESIDENTS
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A LICENSE HAS BEEN FILED UNDER CHAPTER 421-B OF THE NEW HAMPSHIRE REVISED STATUTES WITH THE STATE OF NEW HAMPSHIRE NOR THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE OF NEW HAMPSHIRE THAT ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSON, SECURITY OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT ANY REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.
NOTICE TO INVESTORS IN THE UNITED STATES
Because of the following restrictions, prospective investors are advised to consult legal counsel prior to making any offer, resale, pledge or other transfer of the Shares. The New Shares have not been and will not be registered under the U.S. Securities Act or with any securities regulatory authority of any state or other jurisdiction in the United States and may not be offered, sold, pledged or otherwise transferred within the United States except pursuant to an exemption from, or in a
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transaction not subject to, the registration requirements of the U.S. Securities Act and in compliance with any applicable state securities laws. Accordingly, the New Shares will not be offered or sold within the United States, except in reliance on the exemption from the registration requirements of the U.S. Securities Act under Rule 144A. The New Shares will be offered outside the United States in compliance with Regulation S. Prospective purchasers are hereby notified that sellers of New Shares may be relying on the exemption from the provisions of Section 5 of the U.S. Securities Act provided by Rule 144A under the U.S. Securities Act. See Section 14.2.1 "Selling and transfer restrictions—Selling restrictions—United States".
Any Shares offered or sold in the United States will be subject to certain transfer restrictions as set forth under Section 14.3.1 "Selling and transfer restrictions—Transfer restrictions—United States".
The securities offered hereby have not been recommended by any United States federal or state securities commission or regulatory authority. Further, the foregoing authorities have not passed upon the merits of the Rights Offering or confirmed the accuracy or determined the adequacy of this Prospectus. Any representation to the contrary is a criminal offense under the laws of the United States.
In the United States, this Prospectus is being furnished on a confidential basis solely for the purposes of enabling a prospective investor to consider purchasing the particular securities described herein. The information contained in this Prospectus has been provided by the Company and other sources identified herein. Distribution of this Prospectus to any person other than the offeree specified by the Manager or its representatives, and those persons, if any, retained to advise such offeree with respect thereto, is unauthorised and any disclosure of its contents, without prior written consent of the Company, is prohibited. This Prospectus is personal to each offeree and does not constitute an offer to any other person or to the public generally to purchase New Shares or subscribe for or otherwise acquire any Shares.
NOTICE TO UNITED KINGDOM INVESTORS
This Prospectus is only being distributed to and is only directed at (i) persons who are outside the United Kingdom (the "UK") or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "Relevant Persons"). The New Shares are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Shares will be engaged in only with, Relevant Persons. Any person who is not a Relevant Person should not act or rely on this Prospectus or any of its contents.
NOTICE TO INVESTORS IN THE EEA
In any member state of the European Economic Area (the "EEA") that has implemented the Prospectus Directive, other than Norway (each, a "Relevant Member State"), this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive. The Prospectus has been prepared on the basis that all offers of New Shares outside Norway will be made pursuant to an exemption under the Prospectus Directive from the requirement to produce a prospectus for offer of shares. Accordingly, any person making or intending to make any offer within the EEA of New Shares which is the subject of the Rights Offering contemplated in this Prospectus within any EEA member state (other than Norway) should only do so in circumstances in which no obligation arises for the Company or the Manager to publish a prospectus or a supplement to a prospectus under the Prospectus Directive for such offer. Neither the Company nor the Manager have authorised, nor do they authorise, the making of any offer of Shares through any financial intermediary, other than offers made by the Manager which constitute the final placement of New Shares contemplated in this Prospectus.
Each person in a Relevant Member State other than, in the case of paragraph (a), persons receiving offers contemplated in this Prospectus in Norway, who receives any communication in respect of, or who acquires any New Shares under, the offers contemplated in this Prospectus will be deemed to have represented, warranted and agreed to and with the Manager and the Company that:
a) it is a qualified investor as defined in the Prospectus Directive, and
b) in the case of any New Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (i) such New Shares acquired by it in the Rights Offering have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than qualified investors, as that term is defined in the Prospectus Directive, or in circumstances in which the prior consent of the Manager has been given to the offer or resale; or (ii) where such New Shares have been acquired by it on behalf of persons in any Relevant Member State other than qualified investors, the offer of those New Shares to it is not treated under the Prospectus Directive as having been made to such persons.
For the purposes of this provision, the expression an "offer to the public" in relation to any of the New Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any Shares to be offered so as to enable an investor to decide to purchase any of the New Shares, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State, and the expression " Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in each Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.
See Section 14, "Selling and Transfer Restrictions" for certain other notices to investors.
ENFORCEMENT OF CIVIL LIABILITIES
The Company is a company limited by shares incorporated under the laws of the Cayman Islands. As a result, the rights of holders of the Company’s Shares will be governed by the laws of the Cayman Islands and the Company’s articles of association (the "Articles of Association"). The rights of shareholders under the laws of the Cayman Islands may differ from the rights of shareholders of companies incorporated in other jurisdictions. The majority of the members of the Company’s board of directors (the "Board Members" and the "Board of Directors", respectively) and the members of the senior management of the Group (the "Management") are not residents of the United States, and all of the
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Company’s assets are located outside the United States. As a result, it may be difficult for investors in the United States to effect service of process on the Company or its Board Members and members of Management in the United States or to enforce in the United States judgments obtained in U.S. courts against the Company or those persons, including judgments based on the civil liability provisions of the securities laws of the United States or any State or territory within the United States. Uncertainty exists as to whether courts in Norway will enforce judgments obtained in other jurisdictions, including the United States, against the Company or its Board Members or members of Management under the securities laws of those jurisdictions or entertain actions in the Cayman Islands against the Company or its Board Members or members of Management under the securities laws of other jurisdictions. In addition, awards of punitive damages in actions brought in the United States or elsewhere may not be enforceable in the Cayman Islands. The United States and the Cayman Islands do not currently have a treaty providing for reciprocal recognition and enforcement of judgements (other than arbitral awards) in civil and commercial matters.
AVAILABLE INFORMATION
The Company has agreed that, for so long as any of the New Shares are "restricted securities" within the meaning of Rule 144(a)(3) under the U.S. Securities Act, it will during any period in which it is neither subject to Sections 13 or 15(d) of the U.S. Securities Exchange Act of 1934, as amended (the "U.S. Exchange Act"), nor exempt from reporting pursuant to Rule 12g3-2(b) under the U.S. Exchange Act, provide to any holder or beneficial owners of Shares, or to any prospective purchaser designated by any such registered holder, upon the request of such holder, beneficial owner or prospective owner, the information required to be delivered pursuant to Rule 144A(d)(4) of the U.S. Securities Act.
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TABLE OF CONTENTS
1. EXECUTIVE SUMMARY ........................................................................................................................... 1
2. RISK FACTORS ....................................................................................................................................... 13
3. RESPONSIBILITY FOR THE PROSPECTUS .................................................................................... 19
4. GENERAL INFORMATION .................................................................................................................... 20
5. PRESENTATION OF SIEM OFFSHORE INC. .................................................................................. 22
6. INDUSTRY OVERVIEW ......................................................................................................................... 39
7. CAPITALISATION AND INDEBTEDNESS ........................................................................................ 50
8. SELECTED FINANCIAL INFORMATION ........................................................................................... 53
9. BOARD OF DIRECTORS, MANAGEMENT, EMPLOYEES AND CORPORATE GOVERNANCE 60
10. CORPORATE INFORMATION .............................................................................................................. 70
11. SECURITIES TRADING IN NORWAY ............................................................................................... 81
12. TAXATION ................................................................................................................................................. 85
13. THE RIGHTS OFFERING ...................................................................................................................... 88
14. SELLING AND TRANSFER RESTRICTIONS ................................................................................. 100
15. ADDITIONAL INFORMATION ........................................................................................................... 105
16. DEFINITIONS AND GLOSSARY ....................................................................................................... 107 Appendix A: Memorandum and Articles of Association Appendix B: Annual financial statements 2014 Appendix C: Subscription Form
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1. EXECUTIVE SUMMARY
Summaries are made up of disclosure requirements known as "Elements". These elements are numbered in Sections A – E (A.1 – E.7). This summary contains all the Elements required to be included in a summary for this type of securities and issuer. Because some Elements are not required to be addressed, there may be gaps in the numbering sequence of the Elements. Even though an Element may be required to be inserted in the summary because of the type of securities and issuer, it is possible that no relevant information can be given regarding the Element. In this case a short description of the Element is included in the summary with the mention of "not applicable". Section A – Introduction and warnings A.1 Warning This summary should be read as an introduction to the
Prospectus; any decision to invest in the securities should be based on consideration of the Prospectus as a whole by the investor; where a claim relating to the information contained in the Prospectus is brought before a court, the plaintiff investor might, under the national legislation of the Member States, have to bear the costs of translating the Prospectus before the legal proceedings are initiated; and civil liability attaches only to those persons who have tabled the summary including any translation thereof, but only if the summary is misleading, inaccurate or inconsistent when read together with the other parts of the prospectus or it does not provide, when read together with the other parts of the Prospectus, key information in order to aid investors when considering whether to invest in such securities.
A.2 Consent to use of the prospectus
Not applicable; financial intermediaries are not entitled to use the prospectus for subsequent resale or final placement of securities.
Section B – Issuer B.1 Legal and
commercial name
Siem Offshore Inc.
B.2 Domicile and legal form, legislation and country of incorporation
Siem Offshore Inc. is an exempted company limited by shares incorporated under the laws of Cayman Islands with corporate registration no. 140468.
B.3 Current operations, principal activities and markets
Siem Offshore’s primary activity is to own and operate offshore support vessels for the offshore energy service industry. The Group's fleet comprises of platform supply vessels, anchor-handling, tug, supply vessels, offshore subsea construction vessels and a variety of other support vessels. The Company’s fleet comprises of 55 offshore support vessels, of which 9 vessels are under construction. In addition to its primary activity, the Company has also established a business division for its industrial investments. The
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Group's industrial investment division includes the Group's services as a contractor within the European offshore wind farm and offshore cable laying market, the development of applications for managed pressure drilling, a scientific core drilling vessel, specialized engineering to develop and implement combat management systems for navy vessels and certain other investments.
B.4a Significant recent trends affecting the Company and the industries in which it operates
The North Sea PSV and AHTS vessel market is continuing to experience soft rates and utilization. Additional vessels have entered the North Sea from other regions and as rig activity is reduced, this places pressure on vessel utilization and fixture rates. Vessel owners have placed vessels in lay-up and owners are considering additional lay-ups. The market for OSVs in Brazil has significantly softened following lower demand activity from Petroleo Brasileiro SA (“Petrobras”). When disclosing its five year business plan, Petrobras announced reduced capital expenditures and highlighted cost cutting measures with the intension to reduce leverage going forward. In order for Petrobras to reduce its cost base, there is an increased risk that Petrobras will initiate renegotiation of existing contracts with suppliers, including vessel owners. It is in the opinion of the Company that an increased risk of such contract renegotiations or even contract cancellations for certain vessels of the Company exists. The outlook for the OSV market is expected to remain soft for several years due to reduced investments in the offshore oil and gas industry following lower current and future commodity prices for oil and gas, which again reduces the demand for vessels and puts pressure on utilisation and fixture rates, coupled with increased supply of vessels as more vessels under construction are delivered from yards. In response to the soft OSV market, the Company has decided to take two vessels out of operations and place into lay-up. Siem Offshore Contractors experience steady tendering activity in the offshore windfarm market (“OWF”) with scheduled marine installation activities taking place in 2017 and 2018 and for operations and maintenance contracts to be awarded in 2015. There has been no significant change in the financial or trading position of the Company since the end of the last financial period for which interim financial information has been published. The Company has in connection with preparing the reporting of its second quarter 2015 results considered the fair value of its assets versus the respective book values. It is clear that such considerations will result in impairments on vessel values in the second quarter 2015 results. There has been no material adverse change in the prospects of the issuer since the date of its last published audited financial statements.
B.5 Description of the Group
Siem Offshore Inc. is a holding company with no employees and is therefore depended on services from its subsidiaries. These services consist of administrative, operational and corporate
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services provided by Siem Offshore Management AS and Siem Offshore AS. The Group's vessels are owned by several companies within the Group. Siem Offshore Rederi AS currently owns all Norwegian, Polish and German built vessels, except the OSCV “Siem Spearfish” which is owned by Siem Offshore Construction Vessels AS. Further, Siem Offshore Rederi AS owns 51% of Siem Offshore Ghana International AS, which owns the PSV “Siem Sasha”, and owns 51% of Siem Meling Offshore DA which owns two PSVs. Siem Offshore Do Brazil S.A. owns the locally built Brazilian fleet. Siem Offshore Canada Inc. owns 50% of Secunda Canada LP, which again owns 6 Canadian flagged vessels and has 1 vessel under construction. Siem Offshore Contractors GmbH, which will utilize the cable lay vessel “Siem Aimery” and has the installation support vessel “Siem Moxie” on a time charter, is owned 100% by Siem Offshore Invest AS. Siem AHTS Pool AS manages a pool of 10 AHTS sister vessels (including 2 from a pool partner) in accordance with a partner agreement. The Group's industrial investments business division consists of the subsidiaries Siem Offshore Contractors GmbH and Siem WIS AS, Overseas Drilling Limited which owns the scientific core drilling vessel “JOIDES Resolution” and certain property investments, which are owned 100% by Siem Offshore Invest AS. In addition, the combat management business in Siem Offshore do Brasil SA is included in this business division.
B.6 Interests in the Company and voting rights
Shareholders owning 5% or more of the Shares have an interest in the Company's share capital which is notifiable pursuant to the Norwegian Securities Trading Act. As of the date of this Prospectus, Siem Europe S.a r.l. owns 133,279,421 shares in the Company, equal to 34.4% of the issued Shares. Siem Europe S.a r.l. is the main shareholder of Siem Offshore Inc. and is controlled by a trust whose potential beneficiaries include members of Kristian Siem’s immediate family. Kristian Siem is a Board Member of the Company. Siem Europe S.a r.l. has underwritten the Rights Offering. If, as a result of the underwriting, Siem Europe’s ownership interest is increased above its current ownership interest and such new ownership interest is not reduced by the sale of Shares down to or below the level of the current ownership interest within four weeks, then Siem Europe will be required to make a mandatory offer for all Shares in accordance with existing regulations.
The Company is not aware of any other agreements that at a later stage may lead to change of control of the Company.
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B.7 Selected historical key financial information
The table below sets out selected data from the Group’s consolidated income statement for the year ended 31 December 2014 and for the three months period ended 31 March 2015.
Consolidated Income Statements 2015 2014
(Amounts in USD 1 000) Jan-Mar Jan-DecUnaudited Audited
Operating revenues 125 995 491 312Operating expenses -77 096 -250 153Administration expenses -10 160 -47 033Operating margin 38 739 194 125Depreciation and amortisation -26 750 -96 883Impairment of vessels - -29 000Gain (loss) on sales of fixed assets -15 18 728Gain of sale of interest rate derivatives (CIRR) 92 368Gain (loss) on currency derivative contracts -36 052 -3 023Operating profit -23 986 84 316
Financial revenues 2 249 9 091Financial expenses -11 934 -55 868Result from associated companies -553 1 808Net currency gain (loss) 10 022 34 092Net financial items -216 -10 877
Profit/(loss) before taxes -24 203 73 439
Tax benefit / (expense) -1 360 -2 729Net profit/(loss) -25 562 70 710Net profit/ (loss) attributable to non-controlling interest -49 12 563Net profit/ (loss) attributable to shareholders -25 612 58 147Weighted average number of shares outstanding ('000) 387 591 387 591Earnings(loss) per share (basic and diluted) -0.07 0.15
Comprehensive Income Statements 2015 2014(Amounts in USD 1 000) 1Q Jan-Dec
Unaudited AuditedNet profit/(loss) -25 562 70 710Other comprehensive income (expense)Items that will not be reclassified to profit or lossPension remeasurement gain (loss) - 1 510Items that may be subsequently reclassified to profit or lossCash flow hedges -32 392 -14 622Currency translation differences -3 797 -11 100Total comprehensive income for the period -61 751 46 499Net profit/ (loss) attributable to non-controlling interest -48 12 271Net profit/ (loss) attributable to shareholders -61 799 34 228
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The table below sets out selected data from the Group’s consolidated statement of financial position as of 31 December 2014 and 31 March 2015.
Consolidated Statements of Financial Position
(Amounts in USD 1 000) 31.03.2015 31.12.2014Unaudited Audited
Non-current assetsVessels and equipment 1 596 220 1 743 693Vessels under construction 127 035 130 515Capitalised project cost 10 022 10 965Investment in associates and other long-term receivables 35 051 43 654CIRR loan deposit 1) 26 145 28 453Deferred tax asset 12 587 12 591Intangible assets 23 905 25 937Total non-current assets 1 830 966 1 995 809Debtors, prepayments and other current assets 130 875 147 152Asset held-for-sale 104 110 -Cash and cash equivalents 89 668 117 623Total current assets 324 654 264 774
Total assets 2 155 619 2 260 584
EquityPaid-in capital 526 236 526 236Other reserves -86 796 -45 491Retained earnings 279 060 304 237Shareholders´ equity 718 500 784 982Non-controlling interest 36 497 38 666Total equity 754 997 823 649LiabilitiesBorrowings 971 402 1 087 757CIRR loan 1) 26 145 28 453Other non-current liabilities 40 985 38 532Total non-current liabilities 1 038 532 1 154 742Borrowings 192 624 126 603Accounts payable and other current liabilities 169 467 155 590Total current liabilities 362 091 282 193
Total liabilities 1 400 623 1 436 935
Total equity and liabilities 2 155 619 2 260 584
1) Commercial Interest Reference Rate
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The table below sets out selected data from the Group’s consolidated statements of cash flows for the year ended 31 December 2014 and for the three months period ended 31 March 2015.
Consolidated Statements of Cash Flows2015 2014
(Amounts in USD 1 000) Jan-Mar Jan-DecUnaudited Audited
Cash flow from operationsProfit before taxes, excluding interest -12 435 117 702Interest paid -13 092 -46 362Taxes paid -1 360 -8 957Results from associated companies 553 -1 808Loss/(gain) on sale of assets 15 -18 728Value of employee services 336 2 462Depreciation and amortisation 26 750 96 883Impairments of vessels - 29 000Effect of unreal. currency exchange forward contracts 27 264 5 612Change in short-term receivables and payables -5 538 19 918CIRR -92 -368Other changes 5 400 -11 010
Net cash flow from operations 27 802 184 345
Cash flow from investing activities Interest received 956 4 171Investments in fixed assets -16 730 -525 674Proceeds from sale of fixed assets 0 76 290 Dividend from associated companies - 278Investment in associated companies -2 251 -12 201
Cash flow from investing activities -18 024 -457 136
Cashflow from financing activitiesProceeds from issue of new equity - 1 336Dividend payment - -6 533Contribution from non-controlling interests of consolidated subsidiaries - -Proceeds from bank overdraft -1 309 5 624Proceeds from new long-term borrowing 1 335 447 701Repayment of long-term borrowing -25 489 -131 936
Cash flow from financing activities -25 463 316 192
Net change in cash -15 686 43 400
Cash at bank start of period 117 621 101 206Effect of exchange rate differences -12 267 -26 985
Cash at bank end of period 89 668 117 621
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The table below sets out selected data from the Group’s consolidated statement of changes in equity for the year ended 31 December 2014 and for the three months period ended 31 March 2015.
B.8 Selected key
pro forma financial information
Not applicable. There is no pro forma financial information.
B.9 Profit forecast or estimate
Not applicable. No profit forecasts or estimates are made.
B.10
Audit report qualifications
Not applicable. There are no qualifications in the audit reports.
B.11
Working capital
As of the annual reporting for the fiscal year 2014, the Company was of the opinion that it had sufficient working capital for the next 12 months based on the assumptions of the OSV market at that time. Based on an unfavourable development and assumed continued soft OSV market, the shortfall for the Company’s working capital is currently expected to materialize in second half of 2015 given regular debt schedule payments and payments related to the existing newbuilding program. Accordingly, it is the Company's opinion that the Group at present time does not have sufficient working capital for its current requirements, i.e. for the next 12 months. In order to prepare the Company for the expected soft OSV market and meet the Group's current debt obligations and make payments under the Group's newbuilding program for a period of twelve months from the date of this Prospectus, the Company is dependent on additional financing of approximately USD 100 million. The additional financing will be raised through the fully underwritten Rights Offering as described in this Prospectus.
Consolidated Statement of Changes in Equity
(Amounts in USD 1 000)Total no. of
shares Share capital
Share premium reserves
Other reserves
Retained earnings
Share-holders'
equity
Non- Controlling
interest Total equityEquity on January 1, 2015 387 591 380 3 876 522 361 -45 491 304 237 784 983 38 666 823 649Change previous periods 0 0 0Net profit to shareholders -25 513 -25 513 -49 -25 562Value of employee services 336 336 336Cash flow hedge -32 392 -32 392 -32 392Currency translation differences -8 913 -8 913 1 -8 912Total comprehensive income / (expense) 0 0 -41 305 -25 177 -66 482 -48 -66 531Share issues in partially owned subsidiaries 0 152 152Capital reduction in partially owned subsidiaries -2 274 -2 274Equity on March 31, 2015 387 591 380 3 876 522 361 -86 796 279 060 718 501 36 496 754 997
(Amount in USD 1 000)Total no. of
shares Share capital
Share premium reserves
Other reserves
Retained earnings
Share-holders'
equity
Non- Controlling
interest Total equityEquity on January 1, 2014 387 591 380 3 876 522 361 -19 769 250 161 756 629 37 260 793 888Change previous periods -1 510 -1 510 -1 510Net profit to shareholders 58 147 58 147 12 563 70 710Value of employee services 2 462 2 462 2 462Pension remeasurement 1 510 1 510 1 510Currency translation differences -25 721 -25 721 -293 -26 014Total comprehensive income / (expense) 0 0 -25 721 60 609 34 887 12 271 47 158Share issues in partially owned subsidiaries 0 1 336 1 336Capital reduction in partially owned subsidiaries -12 201 -12 201Buy back of shares 0 0 0 0Dividend paid -6 533 -6 533 -6 533Shares issues in Siem Offshore Inc 0 0Equity on December 31, 2014 387 591 380 3 876 522 361 -45 491 304 237 784 983 38 666 823 649
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Section C – Securities C.1 Type and class
of securities admitted to trading and identification numbers
Listing of New Shares to be issued in the Rights Offering. The Company has one class of Shares and all shares are equal in all respects. The New Shares will have the same VPS registrar and the same International Securities Identification Number (“ISIN”) as the Company’s other shares (ISIN KYG813131011). The Company's Shares are listed on the Oslo Stock Exchange and are traded under the ticker symbol "SIOFF". The Subscription Rights will be fully tradable and listed on the Oslo Stock Exchange with ticker code "SIOFF T" and with ISIN KYG812291097 from 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015.
C.2 Currency The Shares are issued in USD, but trading activity is denominated in NOK.
C.3 Number of shares and par value
The issued share capital of the Company as of the date of this Prospectus is USD 3,875,913.80 divided into 387,591,380 Shares each with a nominal value of USD 0.01 fully paid. Following the Rights Offering, the issued share capital will be USD 8,420,213.80 divided into 842,021,380 Shares.
C.4 Right attached to the securities
The Company has one class of Shares, and each Share carries one vote and has equal rights to dividend. All the Shares are validly issued and fully paid. All of the Company’s shareholders have equal voting rights.
C.5 Restrictions on transferability
Not applicable. The Shares are freely transferable according to Cayman Islands law and the Company’s Articles of Association.
C.6 Admission to trading
The Shares are listed on the Oslo Stock Exchange, under Oslo Børs ticker symbol “SIOFF”. The listing on the Oslo Stock Exchange of the New Shares is subject to the approval of the Prospectus by the Norwegian Financial Supervisory Authority (Norwegian: Finanstilsynet) under the rules of the Norwegian Securities Trading Act. Such approval was granted on 17 August 2015. The first day of trading of the New Shares on the Oslo Stock Exchange, will be on or about 18 September 2015.
C.7 Dividend policy
The priorities for the use of Company funds are determined by the Board of Directors and recommendations of Management influenced by existing conditions. At present, priorities for use of funds in order of importance are repayment of debt, investment opportunities in the business, and the return of capital to the shareholders in form of share buy-back or dividends.
Section D – Risks D.1 Key risks
specific to the Group or its industry
Prospective investors should consider, among other factors, the following financial risks relating to the Group:
• The Group is financed by debt and equity. If the Group requires additional equity financing, it may be unable to raise new equity, or arrange new borrowing facilities, on favorable terms and in amounts necessary to conduct its ongoing and future operations.
• The Group is exposed to currency risk as part of the revenue and costs are denominated in other currencies
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than USD. • The Group is exposed to changes in interest rates as a
portion of the long-term interest-bearing debt is subject to floating interest rates with the remaining amount subject to fixed interest rates.
• The Group's vessels operate in several jurisdictions and the Group may not be able to minimize withholding taxes when operating vessels abroad, avoiding double taxation, and minimizing corporate tax.
Prospective investors should consider, among other factors, the following risks relating to the Group and its business:
• Demand for the Group’s services and products is sensitive to oil and gas price fluctuations, low production levels and disappointing exploration results and possible political incidents.
• The Group's business is subject to possible liabilities caused by technical, operational and commercial actions, harsh weather, capsizing, groundings, collisions, engine problems, technical problems, navigation errors and other conditions beyond the Company’s control.
• Claims brought against the Group could result in a court judgment or settlement or a nature or in an amount that is not covered, in whole or in part, by the Group’s insurance or that it is in excess of the limits of the Company’s insurance coverage.
• The Group is subject to the risk of not receiving the vessels currently under construction on time, at budget and with agreed specifications.
• There is a risk that the process of integrating the new vessels into the Group will provoke unforeseen challenges which may not be effectively manageable by the organization.
• The Group's vessels' service life may be shorter than expected.
• The market balance for offshore support vessels has recently been negatively influenced by excessive newbuild activity, which has led to a stronger growth in supply of vessels than in the demand for vessels.
• The Group's operations involve the use and handling of materials that can be environmentally hazardous.
If any of the abovementioned risks were to continue or materialise, individually or together with other circumstances, they could have a material and adverse effect on the Group and/or its business, financial condition, results of operations, cash flows and/or prospects, which could cause a decline in the value and trading price of the New Shares, resulting in the loss of all or part of an investment in the New Shares.
D.3 Key risks specific to the securities
Prospective investors should consider, among other factors, the following risks relating to the securities described herein:
• To the extent that an existing shareholder does not exercise its Subscription Rights prior to the expiry of the Subscription Period, such shareholder will have their holdings and voting interests diluted.
• An active trading market in the Subscription Rights may
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not develop on the Oslo Stock Exchange. • Certain existing shareholders may be unable to take up
and exercise their Subscription Rights as a matter of applicable law.
• The Company's shares are subject to price volatility for a number of reasons, including the Company's financial results and general market conditions outside the Company's control.
• If the Company raises additional funds by issuing additional equity securities, the holdings and voting interests of existing shareholders could be diluted.
If any of the abovementioned risks were to materialise, individually or together with other circumstances, they could have a material and adverse effect on the Group and/or its business, financial condition, results of operations, cash flows and/or prospects, which could cause a decline in the value and trading price of the New Shares, resulting in the loss of all or part of an investment in the New Shares.
Section E – Offer E.1 Net proceeds
and estimated expenses
The subscription price per share is NOK 1.80, amounting to an aggregate subscription price and gross proceeds of approximately USD 100 million under the Rights Offering. The Rights Offering is fully underwritten by Siem Europe S.a r.l. The total expenses which will be covered by the Company in connection with the Rights Offering is expected to amount to approximately NOK 9 million.
E.2a Reasons for the Offering and use of proceeds
The Company intends to use the net proceeds to serve interest and instalments on its debt in accordance with its repayment schedules and thereby continue to reduce the Company's debt leverage.
E.3 Terms and conditions of the Offering
The Subscription Price in the Rights Offering is NOK 1.80 per New Share. The Subscription Price represents a discount of approximately 14.29% to the closing price of NOK 2.10 per Share as quoted on 10 June 2015. The Subscription Period will commence on 19 August 2015 and end on 2 September 2015 at 16:30 hours (CET). The Subscription Period may not be extended. Shareholders who are registered in the Company’s shareholder register in the VPS as of 18 August 2015 (the Record Date) will receive Subscription Rights. Provided that the delivery of traded Shares is made with ordinary T+2 settlement in the VPS, Shares that are acquired until and including 14 August 2015 will give the right to receive Subscription Rights, whereas Shares that are acquired from and including 17 August 2015 will not give the right to receive Subscription Rights. Existing Shareholders will be granted Subscription Rights giving a preferential right to subscribe for and be allocated New Shares in the Rights Offering. Each Existing Shareholder will be granted 1.1724 Subscription Rights for each Existing Shares registered as
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held by such Existing Shareholder on the Record Date. The number of Subscription Rights granted to each Existing Shareholder will be rounded down to the nearest whole Subscription Right. Each Subscription Right will, subject to applicable securities laws, give the right to subscribe for and be allocated one New Share in the Rights Offering. The Subscription Rights will be credited to and registered on each Existing Shareholder’s VPS account on or about 19 August 2015 under the International Securities Identification Number (ISIN) KYG812291097. The Subscription Rights will be distributed free of charge to Existing Shareholders. The Subscription Rights may be used to subscribe for New Shares in the Rights Offering before the expiry of the Subscription Period on 2 September 2015 at 16:30 hours (CET) or be sold before the end of trading on the Oslo Stock Exchange on 31 August 2015. Acquired Subscription Rights will give the same right to subscribe for and be allocated New Shares as Subscription Rights held by Existing Shareholders on the basis of their shareholdings on the Record Date. The Subscription Rights, including acquired Subscription Rights, must be used to subscribe for New Shares before the end of the Subscription Period (i.e., 2 September 2015 at 16:30 hours (CET)) or be sold before the end of trading on the Oslo Stock Exchange on 31 August 2015. Subscription Rights which are not sold before the end of trading on the Oslo Stock Exchange on 31 August 2015 or exercised before 2 September 2015 at 16:30 hours (CET) will have no value and will lapse without compensation to the holder. Holders of Subscription Rights (whether granted or acquired) should note that subscriptions for New Shares must be made in accordance with the procedures set out in this Prospectus. The Subscription Rights will be fully tradable and listed on the Oslo Stock Exchange with ticker code "SIOFF T" from 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015. The Rights Offering will be completed. If the Rights Offering is not fully subscribed, the Underwriting Agreement will remain in full force and effect and secure a fully subscribed Rights Offering.
E.4 Material and conflicting interests
The Manager or its affiliates have provided from time to time, and may provide in the future, investment and commercial banking services to the Company and its affiliates in the ordinary course of business, for which they may have received and may continue to receive customary fees and commissions. The Manager, its employees and any affiliate may currently own Existing Shares in the Company. Further, in connection with the Rights Offering, the Manager, its employees and any affiliate acting as an investor for its own account may receive Subscription Rights (if they are Existing Shareholders) and may exercise its right to take up such Subscription Rights and acquire New Shares, and, in that capacity, may retain, purchase or sell Subscription Rights or New Shares and any other securities of the Company or other investments for its own account and may offer or sell such securities (or other investments) otherwise than in connection
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with the Rights Offering. The Manager does not intend to disclose the extent of any such investments or transactions otherwise than in accordance with any legal or regulatory obligation to do so.
E.5 Selling Shareholders and lock-up
Not applicable.
E.6 Dilution resulting from the Offering
The dilutive effect following the Rights Offering represents an immediate dilution of approximately 54% for Existing Shareholders who do not participate in the Rights Offering.
E.7 Estimated expenses charged to investor
Not applicable. The Company will not charge any costs, expenses or taxes directly to any shareholder or to any investor in connection with the Rights Offering.
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2. RISK FACTORS
An investment in the Company and the New Shares involves inherent risks. Before making an investment decision with respect to the New Shares, investors should carefully consider the risk factors set forth below and all information contained in this Prospectus, including the Financial Statements and related notes. The risks and uncertainties described in this Section 2 are the principal known risks and uncertainties faced by the Group as of the date hereof that the Company believes are relevant to an investment in the New Shares. An investment in the New Shares is suitable only for investors who understand the risks associated with this type of investment and who can afford to lose all or part of their investment. The absence of negative past experience associated with a given risk factor does not mean that the risks and uncertainties described in that risk factor are not a genuine potential threat to an investment in the New Shares. If any of the following risks were to materialise, individually or together with other circumstances, they could have a material and adverse effect on the Group and/or its business, financial condition, results of operations, cash flows and/or prospects, which could cause a decline in the value and trading price of the New Shares, resulting in the loss of all or part of an investment in the New Shares. The order in which the risks are presented does not reflect the likelihood of their occurrence or the magnitude of their potential impact on the Group’s business, financial condition, results of operations, cash flows and/or prospects. The risks mentioned herein could materialise individually or cumulatively. The information in this Section 2 is as of the date of this Prospectus. Furthermore, risks that the Company currently feels are not material could in the future prove to become significant to the Group.
2.1 Financial risks
2.1.1 Financial leverage
The companies in the Group are financed by debt and equity. If the Group fails to repay or refinance its loan facilities, additional equity financing may be required. There can be no assurance that the Group will be able to repay its debts or extend their re-payment schedule through re-financing of the loan agreements or not experience net cash flow shortfalls exceeding the Group’s available funding sources or to comply with a minimum cash requirements, nor can there be any assurance that the Group will be able to raise new equity, or arrange new borrowing facilities, on favorable terms and in amounts necessary to conduct its ongoing and future operations, should this be required. In the event of insolvency, liquidation or similar event relating to a subsidiary of the Company, all creditors of such subsidiary would be entitled to payment in full out of the assets of such subsidiary before the Company, as a shareholder, would be entitled to any payments. Defaults by, or the insolvency of, a subsidiary of the Company could result in the obligation of the Company to make payments under parent company guarantees issued in favour of such subsidiary.
2.1.2 Interest rates and currency fluctuations
For the Company, USD is the functional and reporting currency. The Group is exposed to currency risk as part of the revenue and costs are denominated in other currencies than USD. The Group is also exposed to currency risk due to future yard instalments in relation to shipbuilding contracts and long-term debt in various currencies other than USD. The Company is exposed to foreign exchange risk of its subsidiaries, including the development of the Brazilian real. The Shares listed on the Oslo Stock Exchange are quoted in NOK. There is a foreign exchange risk associated with conversion from the reporting currency to NOK.
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The Group is exposed to changes in interest rates as a portion of the long-term interest-bearing debt is subject to floating interest rates with the remaining amount subject to fixed interest rates. This may affect the Company’s financial results significantly.
2.1.3 Risks related to loan agreements, restrictions on dividends and distribution
The Group’s current and future loan agreements may include terms, conditions and covenants which impose restrictions on the operations of the Group. These restrictions may negatively affect the Group’s operations, hereunder, but not limited to, the Group’s ability to meet the fierce competition in the market in which it operates.
2.1.4 Additional capital requirements
The Company may require additional capital in the future due to unforeseen liabilities or in order for it to take advantage of business opportunities. There can be no assurance that the Company will be able to obtain necessary financing in a timely manner on acceptable terms. Future share issues may result in the existing shareholders of the Company sustaining dilution to their relative proportion of the equity in the Company.
2.1.5 Risks related to possible tax liabilities
The Group will seek to optimize its tax structure to minimize withholding taxes when operating vessels abroad, avoiding double taxation, and minimizing corporate tax paid by optimally making use of the shipping taxation rules that applies. It is, however, a challenging task to optimize taxation, and there is always a risk that the Group may end up paying more taxes than the theoretical minimum, which may in turn affect the financial results negatively.
2.2 Commercial risks
2.2.1 Market risks
Demand for offshore support vessel services in connection with exploration, development and production in the offshore oil and gas industry is particularly sensitive to oil and gas price fluctuations, low production levels and disappointing exploration results as well as possible political incidents. Demand for the Group’s services and products may also be negatively impacted by increased supply of similar or other complementary vessels into the markets where the Group operates.
2.2.2 Possible liabilities
Offshore support operations are associated with considerable risks and responsibilities, including technical, operational, environmental, commercial and political risks. In addition, offshore operations may be affected by harsh weather, capsizing, groundings, collisions, engine problems, technical problems, navigation errors and other conditions beyond the Group’s control.
2.2.3 Inadequate insurance
Although the Group maintains liability insurance coverage it believes to be in line with industry practice, any claim that may be brought against the Group could result in a court judgment or settlement or a nature or in an amount that is not covered, in whole or in part, by the Group’s insurance or that it is in excess of the limits of the Company’s insurance coverage. The Group’s insurance policies also have various exclusions, including for certain geographic regions, gross negligence caused by the Company or its employees or vessel personnel and for certain pollution or environmental damage. The Group will have to pay any amounts awarded by a court or negotiated in a settlement that exceed the Company’s coverage limitations or that are not covered by the Group’s insurance, and the Group may not have, or be able to obtain, sufficient capital to pay such amounts. This may have a material adverse effect on the Group’s business, revenue, profit and financial condition.
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2.2.4 Dependence on key employees
The development of the Company is dependent on the ability of the senior management to manage the current project portfolio and obtain new and profitable contracts. Although no single person is solely instrumental in fulfilling either of these business objectives, there is no guarantee that they will be achieved to the degree expected. The Group’s business and prospects depend to a significant extent on the continued services of its key personnel. Financial difficulties and other factors could negatively impact the Group’s ability to retain key employees. The loss of any of the members of its senior management or other key personnel or the inability to attract a sufficient number of qualified employees could adversely affect its business and results of operations.
2.2.5 Delivery of vessels under construction
The Group currently has 9 vessels under construction. The process for construction of new offshore vessels is associated with numerous risks. Among the most critical risk factors in relations to such construction is the risk of not receiving the vessels on time, at budget and with agreed specifications. In addition, there is the risk of the different yards experiencing financial or operational difficulties resulting in bankruptcy or otherwise adversely affecting the construction process. The Group has obtained certain guarantees of financial compensation including refund guarantees in case of delays and non-delivery, and it has the right to cancel contracts if delivery of vessels is significantly delayed. However, no assurance can be given that all risks have been fully covered. Delays and non-delivery of the vessels under construction are likely to result in a loss of income for the Group, and could also possibly lead to breach of contract in respect of contracts entered into between the Group and third parties concerning employment of vessels.
2.2.6 Integration of vessels under construction
With 9 vessels under construction, including one under construction by the 50% owned company Secunda, and the subsequent delivery of the vessels, the scale and complexity of operations at the Group will increase going forward. There is a risk that the process of integrating the new vessels into the Group will provoke unforeseen challenges which may not be effectively manageable by the organization.
2.2.7 Service life and technical and operational risks
The service life of modern offshore support vessels is generally considered to exceed thirty years, but may ultimately depend on its efficiency and demand for such equipment. There can be no guarantees that the Group’s current and future fleet will have a long service life. The vessels may have particular unforeseen technical problems or deficiencies, new environmental requirements may be enforced, or new technical solutions or vessels may be introduced that are more in demand than the Group’s vessels, causing less demand and use of these vessels.
2.2.8 New capacity entering the market
It typically takes approximately 12-18 months from the time an offshore support vessel is ordered until it is delivered, depending on its complexity and the order backlog at the ship yards. The market balance for offshore support vessels has recently been negatively influenced by excessive newbuild activity, which has led to a stronger growth in supply of vessels than in the demand for vessels. This may consequently negatively affect the results and asset values of the Group.
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2.2.9 The risk of new technological developments
The market for oil and gas technologies has developed towards a single competitive market for concepts and technological solutions. Companies with the best solutions will therefore achieve a strong competitive position in both markets. In the long run, a competitive advantage in products and services for offshore services will be achieved through continuous development and commercialization of new technical solutions. There can be no assurance that the Group will be able to maintain its current competitive position in this respect. The Group’s ability to secure its intangible rights legally is important since the development of the Group will to some extent depend on its technological advances. Third parties might act in violation of these rights and it is not possible to achieve protection of intangible rights in certain countries. There can be no assurance that the Group will be able to sufficiently secure its intellectual property and other intangible rights.
2.3 Other risks
2.3.1 Political risks
The Group has among others operations and investments in countries that are regarded as unsafe and politically unstable. Activities in these countries will often involve greater risk, including unfavorable changes in tax laws and other laws, partial or full expropriation, currency volatility and restrictions on currency transfer, disruption of operations because of labour disputes or political riots or wars, and some individual countries’ requirements for some local ownership interests. The Group’s operations are moreover subject to laws, regulations and supervisory rules in the country where the activity is performed. The operations of the Group may be negatively affected by changes in environmental laws and other regulations that can result in large expenses in, for example, modification of vessels and changes in the operation of vessels.
2.3.2 Environmental risks
The Group’s operations involve the use and handling of materials that can be environmentally hazardous. Environmental legislation has in general become stricter in the countries in which the Group operates. These laws and regulations might expose the Group to liability due to events caused by others or by it, even though the actions were consistent with existing laws at the time. In the event of liability arising due to the action of a customer, the Group would expect to get some contractual compensation from that customer through contractual regulations for events such as pollution and other environmental damage. However, there can be no assurance that the compensation granted in such events, if at all granted, will cover the losses suffered.
2.4 Risks related to the Shares and the Rights Offering
2.4.1 Dilution as a result of non-participation in Rights Offering.
Subscription Rights that are not exercised by the end of the Subscription Period will automatically expire without compensation to the holder. To the extent that an existing shareholder does not exercise its Subscription Rights prior to the expiry of the Subscription Period, whether by choice or due to a failure to comply with procedures set forth in Section 13, "The Rights Offering", or to the extent that an existing shareholder is not permitted to subscribe for New Shares, such existing shareholders’ proportionate ownership and voting interests in the Company after the completion of the Rights Offering will be diluted. Even if an existing shareholder elects to sell its unexercised Subscription Rights, or such Subscription Rights are sold on its behalf, the consideration it receives on the trading market for the Subscription Rights may not reflect the
17
immediate dilution in its shareholding as a result of the completion of the Rights Offering.
2.4.2 Absence of active trading market in Subscription Rights.
An active trading market in the Subscription Rights may not develop on the Oslo Stock Exchange. In addition, because the trading price of the Subscription Rights depends on the trading price of the Shares, the price of the Subscription Rights may be volatile and subject to the same risks as described for the Shares in the below risk factors. The existing volatility of the Shares may also have an effect on the volatility of the Subscription Rights.
2.4.3 Sales of Subscription Rights.
Certain existing shareholders may be unable to take up and exercise their Subscription Rights as a matter of applicable law. The Subscription Rights of such existing shareholders, with the exception of Subscription Rights held through financial intermediaries, will, to the extent possible, be sold on their behalf in the market by the Manager and the Receiving Agent pursuant to instructions from the Company, but no assurance can be given as to whether such sales may actually take place or as to the price that may be achieved. Other existing shareholders may also choose not to exercise their Subscription Rights and therefore sell them in the market. The sale of Subscription Rights by or on behalf of existing shareholders could cause significant downward pressure on, and may result in a substantial reduction in, the price of the Subscription Rights and the Shares.
2.4.4 Volatility of the share price
The trading price of the Shares could fluctuate significantly in response to quarterly variations in operating results, adverse business developments, interest rate, changes in financial estimates by securities analysts, matters announced in respect of major customers or competitors, or changes to the regulatory environment in which the Company operates. The market price of the Shares could decline due to sales of large numbers of Shares in the market or the perception that such sales could occur. Such sales could also make it more difficult for the Company to offer equity securities in the future at a time and at a price that are deemed appropriate. In recent years, the securities markets in Norway and elsewhere in Europe, have experienced a high level of price and volume volatility, and the market price of securities of many companies have experienced wide fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. There can be no assurance that continual fluctuations in price will not occur. It is likely that the quoted market price for the Shares will be subject to market trends generally, notwithstanding the financial and operational performance of the Company.
2.4.5 Difficulties for foreign investors to enforce civil liabilities in Cayman Islands
The Company is organized under the laws of Cayman Islands. The rights of holders of Shares are governed by Cayman Islands law and by the Articles of Association. These rights may differ from the rights of shareholders in other jurisdictions, including Norway. As a result, it may, inter alia, be difficult for a shareholder to take legal action against the Company and/or its directors in the investor’s own jurisdiction, or to enforce against them judgments obtained in non-Cayman Islands courts.
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2.4.6 Restrictions on ability to transfer or resell the Shares without registration under applicable securities laws
The Shares are being offered and sold pursuant to an exemption from registration under the U.S. and applicable state securities laws. Therefore, the Shares may only be transferred or resold in the U.S. in a transaction registered under or exempt from the registration requirements of the applicable securities laws, and U.S. Shareholders may be required to bear the risk of their investment for an indefinite period of time. The Company does not currently anticipate registering any resale transaction under applicable securities laws.
2.4.7 Dilution as a result of future share issue
The Company may in the future decide to offer additional Shares or other securities in order to finance new capital-intensive projects, in connection with unanticipated liabilities or expenses or for any other purposes. There is no assurance the Company will not decide to conduct further offerings of securities in the future. Depending on the structure of any future offering, certain existing shareholders may not have the ability to purchase additional equity securities. If the Company raises additional funds by issuing additional equity securities, the holdings and voting interests of existing shareholders could be diluted.
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3. RESPONSIBILITY FOR THE PROSPECTUS
This Prospectus has been prepared in connection with the Rights Offering described herein. The Board of Directors of Siem Offshore Inc. accepts responsibility for the information contained in this Prospectus. The members of the Board of Directors confirm that, after having taken all reasonable care to ensure that such is the case, the information contained in this Prospectus is, to the best of their knowledge, in accordance with the facts and contains no omissions likely to affect its import.
, _____ 2015
Eystein Eriksrud Chairman
Kristian Siem Board member
Michael Delouche Board member
David Mullen Board member
John C. Wallace Board member
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4. GENERAL INFORMATION
4.1 Presentation of financial and other information
4.1.1 Financial information
See section 8.2, "Selected financial information–Summary of accounting policies and principles" for further details regarding the basis for the Group's financial information. 4.1.2 Industry and market data
This Prospectus contains statistics, data, statements and other information relating to markets, market sizes, market shares, market positions and other industry data pertaining to the Group's business and the industries and markets in which it operates. Unless otherwise indicated, such information reflects the Group's estimates based on analysis of multiple sources, including data compiled by professional organisations, consultants and analysts and information otherwise obtained from other third party sources, such as annual and interim financial statements and other presentations published by listed companies operating within the same industry as the Group, as well as the Group's internal data and its own experience, or on a combination of the foregoing. Unless otherwise indicated in the Prospectus, the basis for any statements regarding the Group's competitive position is based on the Company's own assessment and knowledge of the market in which it operates. Although the industry and market data is inherently imprecise, the Company confirms that where information has been sourced from a third party, such information has been accurately reproduced and that as far as the Company is aware and is able to ascertain from information published by that third party, no facts have been omitted that would render the reproduced information inaccurate or misleading. Where information sourced from third parties has been presented, the source of such information has been identified. The Company does not intend, and does not assume any obligations to, update industry or market data set forth in this Prospectus. Industry publications or reports generally state that the information they contain has been obtained from sources believed to be reliable, but the accuracy and completeness of such information is not guaranteed. The Company has not independently verified and cannot give any assurances as to the accuracy of market data contained in this Prospectus that was extracted from these industry publications or reports and reproduced herein. Market data and statistics are inherently predictive and subject to uncertainty and not necessarily reflective of actual market conditions. Such statistics are based on market research, which itself is based on sampling and subjective judgments by both the researchers and the respondents, including judgments about what types of products and transactions should be included in the relevant market. As a result, prospective investors should be aware that statistics, data, statements and other information relating to markets, market sizes, market shares, market positions and other industry data in this Prospectus and projections, assumptions and estimates based on such information may not be reliable indicators of the Company's future performance and the future performance of the industry in which it operates. Such indicators are necessarily subject to a high degree of uncertainty and risk due to the limitations described above and to a variety of other factors, including those described in Section 2, "Risk factors" and elsewhere in this Prospectus. 4.1.3 Rounding
Certain figures included in this Prospectus have been subject to rounding adjustments (by rounding to the nearest whole number or decimal or fraction, as the case may be). Accordingly, figures shown for the same category presented in different tables may vary slightly. As a result of rounding adjustments, the figures presented may not add up to the total amount presented.
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4.2 Forward-Looking Statements
This Prospectus includes forward-looking statements, including, without limitation, projections and expectations regarding the Group's future financial position, business strategy, plans and objectives. All forward-looking statements included in the Prospectus are based on information available to the Company, and views and assessments of the Company, as at the date of this Prospectus. Except as required by the applicable stock exchange rules or applicable law, the Company does not intend, and expressly disclaims any obligation or undertaking, to publicly update, correct or revise any of the information included in this Prospectus, including forward-looking information and statements, whether to reflect changes in the Company's expectations with regard thereto or as a result of new information, future events, changes in conditions or circumstances or otherwise on which any statement in this Prospectus is based. When used in this document, the words "anticipate", "assume", "believe", "can", "could", "estimate", "expect", "intend", "may", "might", "plan", "should", "will", "would" or, in each case, their negative, and similar expressions, as they relate to the Company, its subsidiaries or its management, are intended to identify forward-looking statements. The Company can give no assurance as to the correctness of such forward-looking statements and investors are cautioned that any forward-looking statements are not guarantees of future performance. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company and its subsidiaries, or, as the case may be, the industry, to materially differ from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Group's present and future business strategies and the environment in which the Company and its subsidiaries operate. Factors that could cause the Company's actual results, performance or achievements to materially differ from those in the forward-looking statements include but are not limited to, the competitive nature of the markets, in which the Company operates, technological developments, government regulations, changes in economic conditions or political events. These forward-looking statements reflect only the Company's views and assessment as at the date of this Prospectus. Factors that could cause the Company's actual results, performance or achievements to materially differ from those in the forward-looking statements include, but are not limited to, those described in Section 2, "Risk factors" and elsewhere in the Prospectus. Given the aforementioned uncertainties, prospective investors are cautioned not to place undue reliance on any of these forward-looking statements. Forward looking statements are found in sections 2, "Risk Factors", 4, "General information, 5, "Presentation of Siem Offshore Inc.", 6, "Industry Overview", 7 "Capitalisation and indebtedness", 8, "Selected financial information, 9, "Board of directors, management , employees and corporate governance", 10, "Corporate information", 11 "Securities trading in Norway", 12, "Taxation", 13, "The Rights Offering", 14, "Selling and transfer restrictions and 15, "Additional information"..
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5. PRESENTATION OF SIEM OFFSHORE INC.
5.1 Overview
The Group’s primary business activity is to own and operate offshore support vessels ("OSVs") for the offshore energy service industry. The OSV fleet comprises of platform supply vessels ("PSVs"), anchor-handling, tug, supply vessels ("AHTS vessels"), offshore subsea construction vessels ("OSCVs") and a variety of other support vessels. The Company’s fleet comprises of 55 offshore support vessels, of which 9 vessels are under construction. In addition to its primary activity, the Company has also established a business division for industrial investments. The Group's industrial investment division includes the Group's services as a contractor within the European offshore wind farm and offshore cable lay market, the development of applications for managed pressure drilling, a scientific core drilling vessel, specialized engineering to develop and implement combat management systems for navy vessels and certain other investments. The Company’s headquarter and corporate management team is located in Kristiansand, Norway and additional subsidiary offices are located in Brazil, Germany, the Netherlands, Ghana, USA, Poland and Australia. The Company is tax resident in Norway.
5.2 Group structure
The chart below shows a simplified structure of the Group:
Siem Offshore Inc. is a holding company with no employees and is therefore dependent on service from its subsidiaries. These services consist of administrative, operational and corporate services provided by Siem Offshore Management AS and Siem Offshore AS. The Group's vessels are owned by several companies within the Group. Siem Offshore Rederi AS currently owns all Norwegian, Polish and German built vessels, except the OSCV “Siem Spearfish” which is owned by Siem Offshore Construction Vessels AS.
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Further, Siem Offshore Rederi AS owns 51% of Siem Offshore Ghana International AS, which owns the PSV “Siem Sasha”, and 51% of Siem Meling Offshore DA which owns two PSVs. Siem Offshore Do Brazil S.A. owns the locally built Brazilian fleet. Siem Offshore Canada Inc. owns 50% of Secunda Canada LP ("Secunda"), which owns 6 Canadian flagged vessels and has 1 vessel under construction. Siem Offshore Contractors GmbH, which will utilize the cable lay vessel (“CLV”) “Siem Aimery” and has the installation support vessel (“ISV”) “Siem Moxie” on a time charter, is owned 100% by Siem Offshore Invest AS. Siem AHTS Pool AS manages a pool of 10 AHTS sister vessels (including 2 from a pool partner) in accordance with a partner agreement. The Group's industrial investments business division consists of the subsidiaries Siem Offshore Contractors GmbH and Siem WIS AS, Overseas Drilling Limited which owns the scientific core drilling vessel “JOIDES Resolution” and certain other investments, which are owned 100% by Siem Offshore Invest AS. In addition the combat management business in Siem Offshore do Brasil SA is included in this business division. Below is a list of directly owned subsidiaries of the Company:
Company Registered office
Ownership and voting
share
Siem Offshore AS Kristiansand, Norway 100 % Siem Offshore Invest AS Kristiansand, Norway 100 % Siem Offshore Rederi AS Kristiansand, Norway 100 % Siem Offshore Construction Vessels AS Kristiansand, Norway 100 % Siem Offshore do Brasil SA Rio de Janeiro, Brazil 100 % Siem Offshore US Inc. Delaware, USA 100 % Siem AHTS Pool AS Kristiansand, Norway 100 % DSND Subsea Ltd London, UK 100 % Siem Offshore Services AS Kristiansand, Norway 100 % Siem Offshore Management AS Kristiansand, Norway 100 % Siem Offshore Management (US) Inc. Texas, USA 100 % Siem Offshore US Holding AS Kristiansand, Norway 100 % Siem Offshore Crewing (CI) Inc. Cayman Islands 100 %
In addition, the subsidiaries own the following companies;
Company Registered office
Share and voting rights
Consub Delaware LLC Delaware, USA 100 % Aracaju Serviços Auxiliares Ltda Rio de Janeiro, Brazil 100 % Siem Offshore Crewing AS Kristiansand, Norway 100 % Siem Meling Offshore DA Stavanger, Norway 51 % Næringsbygg Indrettsveien 13 DA Fjell, Norway 95 % Siem WIS AS Bergen, Norway 60 % Siem Offshore Maritime Personnel AS Kristiansand, Norway 100 % Siem Offshore Contractors GmbH Leer, Germany 100 % SOC Equipment and Personnel Services BV Groningen, The Netherlands 100 % AHMTEC GmbH Leer, Germany 100 % Overseas Drilling Ltd Groningen, The Netherlands 100 % Siem Offshore Canada Inc. Halifax, Canada 100 % Siem Offshore Poland Sp.z.O.O Gdynia, Poland 100 % Siem Offshore Australia Pty Ltd Perth, Australia 100 %
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Company Registered office
Share and voting rights
Siem Offshore Real Estate GmbH Leer, Germany 100 % Siem Offshore Contractors UK Ltd London, UK 100 % Siem Offshore Ghana International AS Kristiansand, Norway 51%
The Company also holds ownership interests in certain non-material subsidiaries and joint ventures.
5.3 History
The Company traces its roots back to Det Søndenfjeldske-Norske Dampskipselskap AS ("DSND"), which was established in 1854. The main activity in DSND until 1964 was shipping operations, with a focus on passenger transportation. In 1964, DSND’s passenger lines service between Hamburg and Oslo was closed down, and DSND’s activity level was then limited until 1985. DSND operated as an investment company between 1985 and 1995, with investments mostly in offshore related activities. By early 1990, DSND had taken ownership of several dynamically positioned ("DP") offshore vessels. As a consequence, the board wanted to cultivate DSND’s investment profile and strategy, and other non-offshore related investments were gradually sold or spun-off from the company. By 1995, the DSND owned six special offshore vessels, of which two were used for offshore construction, two for well maintenance and two for geo-technical drilling. The company planned for further expansion into these three business areas through the addition of technology and human capital. DSND conducted eight acquisitions of assets or businesses between 1995 and 2002, which gave the company a significant position within the area of offshore maintenance and construction, both in terms of geography and resources. The acquisition provided DSND the skills and equipment to complete total construction contracts for deep water subsea installations, as well as the install of pipelines, floating production, units and riser systems, and link-up and completion of subsea production installations. On 18 October 2001, DSND announced that they were in discussions with Halliburton on combining their respective activities within subsea construction and related services. On 23 May 2002, the two companies announced that they had completed a final agreement for the creation of the 50/50 joint venture company Subsea 7 Holding Inc. (formerly named Subsea 7 Inc.), registered in the Cayman Islands. The agreement involved all substantial subsea-related assets, personnel and existing contracts from both companies to be included in the joint venture. After the merger in May 2002, both Halliburton and DSND actively contributed to the further industrial development of the Subsea 7 Holding Inc. business. During this period Subsea 7 also consolidated its non-subsea activities through the divestment of loss-making activities and by a more concentrated focus. The holding company was further relocated from Norway to the Cayman Islands in the fourth quarter of 2002 through a share swap. In 2002, DSND was renamed Siem Offshore Inc. which again subsequently changed its name to Subsea 7 Inc. in 2005. In 2004, the Company was incorporated under the name of Siem Supply Inc. as a subsidiary of the company then named Siem Offshore Inc. (now Subsea 7 Inc.). In July 2005, Subsea 7 decided that it would be beneficial for the further development of both its subsea business and its non-subsea business, as well as enhance shareholder value, to separate the subsea and the non-subsea business and give them the
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opportunity to develop in distinct companies and under separate management. As a consequence, the Company acquired the non-subsea assets of Subsea 7 not already held by the Company and the Company was spun-off from Subsea 7. The Company listed the Shares on the Oslo Stock Exchange in August 2005. Early in 2006, the Company completed a merger with Rovde Shipping AS which owned or operated six vessels, whereof three standby vessels which have subsequently been sold. Also, during 2006, the Company acquired a majority shareholding in Siem WIS AS. Further, the Company acquired the newbuilding contract for the vessel Siem Mariner from OH Meling & Co AS, and entered into the joint venture Siem Meling Offshore DA which controlled an additional two vessels. The Company also contracted four MRSVs from Kleven Verft AS. In 2010, Petrobras chartered four AHTS vessels from the Company for a firm period of four years. The contract value for the firm period was approximately USD 285 million (NOK 1.9 billion), net of local taxes. The contracts for the four AHTS vessels were added to the Brazilian activities of ten vessels in operation and eight vessels under construction at that time. The contracts marked growth of operations in Brazil and an important step in becoming a first class operator in Brazil. In 2011, the company acquired the remaining 50% ownership interest in the shares of ODL from a subsidiary of Transocean Ltd. In the same year, the Company announced the entry into the business for submarine cable installation, repair and maintenance projects. The Company and the shareholders of Five Oceans Services ("FOS"), later to be renamed Siem Offshore Contractors GmbH, reached an agreement whereby the Company acquired all shares in FOS. The transaction combined the marine operating capacities of the Company with the engineering capabilities and project execution expertise of FOS and formed a strong entity to meet the forecasted market growth and customer requirements. In 2012, Siem Offshore Contractors, the wholly owned subsidiary of the Company, announced that it had been awarded the first contract for the renewable energy market for the installation of the inner array grid cables as well as associated services for the Amrumbank West offshore wind farm ("OWF") project. The contract award marked the entry into the Offshore Renewable Energy Market for the Group. Subsequently, Siem Offshore Contractors has been successful in winning additional contracts for OWF projects. In 2013, the Company acquired 50% of Secunda. Secunda had more than two decades of offshore experience in serving the oil and gas industry and at the time of the acquisition Secunda owned and operated a fleet of six offshore support vessels on Canada’s east coast. The ownership in Secunda provided the Company with a strategic position in Canada’s east coast offshore sector with the aim to grow the business of Secunda and also to develop the Company’s current business through the position represented by Secunda. In 2014, the Company entered into agreements with a client to provide two well-intervention vessels ("WIVs" or "Well-Intervention Vessels"). The vessels are under construction in Germany and have an overall length of 158 meters, a beam of 31 meters, and built in compliance with the MODU-class (Marine Offshore Drilling Units). The agreements represented a targeted entry for the Company as vessel provider into the segment for Well-Intervention Vessels. In 2015, the Company decided to streamline its business by forming one dedicated organisation for its core offshore vessel business named "Siem Offshore OSV". The remaining business consisting of Siem Offshore Contractors, “JOIDES Resolution”, Siem WIS, the combat management business in Brazil and certain other investments will be
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organisationally separated and operated under the name of "Siem Offshore Industrial Investments". In the period 2006 to 2015, the fleet of vessels in operation has grown from 21 to 46 vessels. The fleet growth has mainly been achieved through the construction of vessels. The vessel fleet is set to increase further with the delivery of the 9 vessels currently under construction.
5.4 Business objectives and strategy
The objective of the Company is to maintain and develop the Offshore Support Vessel (OSV) activities, continue to strengthen the Contracting Business providing services for the Offshore Windfarm Renewable Industry and other cable laying activities, and to find strategic solutions for its other investments. The Company intends to pursue a strategy of continued consolidation and growth, with the aim of becoming one of the leading owners and operators of high specification OSV’s on a global basis, and the leading contractor for the Offshore Windfarm Renewable Industry.
5.4.1 Advanced fleet
The fleet consists of 55 advanced high-end offshore support vessel, of which 9 of these are under construction. The fleet includes large Anchor Handling Tug Supply vessels, Platform Supply Vessels, Multipurpose field & ROV Support Vessel and Offshore Subsea Construction Vessels designed to meet the most challenging environments. The latest addition to the fleet is two Well-Intervention Vessels currently under construction. The Company aims at meeting the market’s demand for modern and advanced support vessels for the global offshore oil and gas industry. This is supported by the newbuilding activity undertaken by the Group, which will strengthen the Group’s offshore fleet with additional modern and, environmentally friendly and technically advanced offshore support vessels.
5.4.2 Industrial Investments
The primary activities for Siem Offshore Contractors GmbH ("SOC") include the installation, post-lay trenching, termination and testing of submarine composite cables forming the inner array grid of an OWF. SOC has been technically successful in executing its planned work scope by utilising its chartered fleet of large and high quality DP-2 installation vessels, in combination with its experienced offshore and onshore organisation. SOC will also focus on other cable laying opportunities. Siem WIS AS has designed and developed a pressure control device ("PCD") which can improve managed pressure drilling ("MPD") operations. These services are increasing due to global challenges with depleted reservoirs, drilling of additional and infield wells, and the demand to achieve a more constant well pressure during drilling and tripping operations. Global energy demand growth, combined with an increasing number of deep sea and high pressure high temperature ("HPHT") reservoirs, and increasing emphasis on safety management will lead to increased demand for MPD services. The “JOIDES Resolution” is a scientific core sampling research vessel. Its mission is to explore the Earth below the oceans of the world in order to investigate the origin and the evolution of the Earth. The ship is a dynamically positioned non-riser drilling/coring vessel capable of operating in water depths of 7,000 meters, and with holes cored to depths of 2,000 meters below the seafloor.
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5.4.3 Professional and cost effective operations
The Group will maintain a strong focus on operating its fleet professionally and cost-effectively and in accordance with relevant laws and regulations. The Company has, and will continue to have, a small team of dedicated staff focusing on core activities such as marketing, chartering, technical supervision, finance, business development and investor relations, and may outsource services within the areas of technical management, construction supervision and certain administrative functions to well-qualified suppliers of such services.
5.5 Business activities
5.5.1 Introduction
The Company's business is split into two divisions:
• Siem Offshore OSV, which comprises the Group's core offshore vessel business • Siem Offshore Industrial Investments, which comprises the Group's other
businesses
5.5.2 Siem Offshore OSV
Siem Offshore OSV’s primary activity is to own and operate OSVs for the offshore energy service industry. The OSV fleet comprises PSVs, AHTS vessels, OSCVs, and a variety of other support vessels including but not limited to an ISV, Brazilian built vessels including oil spill recovery vessels ("OSRVs"), fast supply vessels ("FSVs") and fast crew vessels ("FCVs"). Fleet The Group’s fleet comprises 46 vessels in operation. In addition, the Group has entered into firm contracts for the construction of another 9 vessels, including one vessel under construction by Secunda. The vessels under construction are to be delivered in the period 2015 to 2016. The average age of main vessel types in operation are five years for AHTS vessels, two years for OSCVs and eight years for PSVs. The below table summarizes the main characteristics of the Group’s current fleet:
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Delivery of vessels under construction The following list summarizes the scheduled time of delivery of the Group’s vessels under construction as of end first quarter 2015:
Note 1) Vessel under construction in the 50% owned entity Secunda.
20151Q 2Q 3Q 4Q
20161Q 2Q 3Q 4Q
20171Q 2Q 3Q 4Q
OSRV, Siem Marataizes
CLV, Siem Aimery
PSV DF, Siem Pride
PSV DF, ”TBN 1”
PSV DF, ”TBN 2”
PSV DF, ”TBN 3”
WIV, Siem Helix 1
WIV, Siem Helix 2
AHTS, Avalon Sea (Note 1)
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Contract coverage for vessels under construction The following list summarizes the contract coverage of the Group’s vessels under construction as of end first quarter 2015:
Of the 9 vessels under construction, the OSRV will enter into an eight year firm contract upon delivery from yard, the CLV will enter an internal time charter with a subsidiary of the Company and the PSV “Siem Pride” will commence on a five year firm time charter with AS Norske Shell. The two Well-Intervention Vessels under construction in Germany, with delivery in 1Q and 3Q 2016, have both been chartered out on seven year firm charter contracts plus options. The AHTS, “Avalon Sea” under construction by Secunda has secured a five year firm contract plus options. The three dual fuelled PSVs currently under construction in Poland, with delivery in 2016, have yet to secure firm contracts. The Company has obtained certain guarantees of financial compensation including refund guarantees for pre-delivery instalments related to vessels under construction in Poland and parts of the pre-delivery instalments related to vessels under construction in Germany in case of delays and non-delivery. Further, the Company has the right to cancel contracts if delivery of vessels is significantly delayed. However, no assurance can be given that all risks have been fully covered. There are no guarantees of financial compensation or refund guarantees with respect to the OSRV under construction in Brazil. Contract coverage and operations of current fleet The Group’s vessels are currently operating in the North Sea, off the Brazilian coast, the Mediterranean, West Africa and the Gulf of Mexico/the US Golf.
2015 2016 2017 2018
Vessel Type Ownership 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Brazil, Siem Marataizes OSRV 100%
Poland, Siem Aimery CLV 100%
Poland, Siem Pride PSV 100%
Poland, ”TBN 1” PSV 100%
Poland, ”TBN 2” PSV 100%
Poland, ”TBN 3” PSV 100%
Germany, Siem Helix 1 WIV 100%
Germany, Siem Helix 2 WIV 100%
Poland, Avalon Sea (Note 1) AHTS 50%
Under Construction Contract Contract option Contract with subsidiary
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Below is an overview of the firm contracts and options for the Group’s fleet of PSVs, OSCVs, AHTSs and ISV in operation as of end first quarter 2015:
1) Employment for “Siddis Mariner” includes firm time charter for Siem Offshore Contractors. 2) The backlog for “Siem Daya 1” includes an assumption of completion of sale in August 2015. 3) “Siem Aquamarine” and “Siem Diamond” are currently in lay-up 4) Employment for “Siem Garnet” and “Siem Emerald” includes firm time charter for Siem Offshore
Contractors 5) The ISV “Siem Moxie” shall primarily be utilized by the subsidiary Siem Offshore Contractors for cable
installation projects within the offshore wind-farm segment. 6) “Siem Sasha” was sold to a company owned 51% by Siem Offshore in June 2015.
In April 2015 the Company announced that it had agreed to sell the OSCV “Siem Daya 1” to Daya Materials Berhad (“Daya”). The purchase price for the vessel has been agreed at USD 120 million. In addition, the Company is entitled to a 60/40 profit share in the Company’s favour based on the profit Daya makes on the vessel limited to an additional USD 10 million. USD 30 million of the purchase price for the vessel will be financed by a sellers credit from Siem Offshore in the form of a convertible bond to Daya with 4 years duration and a coupon of 5%, and a conversion price of 15 Malaysian sen per share. The sale is subject to certain conditions and the cancelling date for the completion of the sale is 31 August 2015. If the vessel is not sold and delivered to Daya, the vessel will continue on the remaining 3 year term period of the initial 5 year term contract with Daya, which commenced upon delivery of the vessel from yard in August 2013. Secunda Canada LP The 50%-owned company, Secunda, has ownership in a fleet of six offshore support vessels which operate offshore Canada. Secunda is engaged in support services for platform supply, anchor handling, rescue standby and towage in its primary area of operation outside the coast of Eastern Canada. Secunda has one vessel under construction with scheduled delivery in 2015.
2015 2016 2017 2018
Vessel Type Ownership 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Siem Sasha 6) PSV 51 %Sophie Siem PSV 100 %Siem Louisa PSV 100 %Siem Hanne PSV 100 %Siem Carrier PSV 100 %Siem Supplier PSV 100 %Hugin Explorer PSV 100 %Siem Atlas PSV 100%Siem Giant PSV 100%Siem Symphony PSV 100%Siem Pilot PSV 51%Siddis Mariner 1) PSV 51%Siem Marlin OSCV 100%Siem N-Sea OSCV 100%Siem Daya 1 2) OSCV 100%Siem Daya 2 OSCV 100%Siem Spearfish OSCV 100%Siem Stingray OSCV 100%Siem Pearl AHTS 100%Siem Emerald 4) AHTS 100%Siem Sapphire AHTS 100%Siem Aquamarine 3) AHTS 100%Siem Ruby AHTS 100%Siem Topaz AHTS 100%Siem Diamond 3) AHTS 100%Siem Amethyst AHTS 100%Siem Garnet 4) AHTS 0%Siem Opal AHTS 0%Siem Moxie 5) ISV 100%
Total order backlog in % and USD mill. 51% 141 36% 137 23% 95 11% 52
Agreed sold
Contract Contract option Spot work Contract with subsidiary
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Big Orange XVIII The Company has a 41%-ownership in the "Big Orange XVIII", which is a DP-2 well stimulation vessel. Siem Offshore Do Brazil S.A. (trademark: Siem Consub SA ) The Company’s subsidiary Siem Consub SA in Brazil is an owner and operator of offshore support vessels and crew boats in the Brazilian market. Siem Consub’s head office is located in Rio de Janeiro in addition to bases located along the Brazilian coast. With more than 26 years of experience in Brazil, Siem Consub is focused on offshore support operations, submarine cable maintenance and installation, engineering and systems integration for the defence market. Siem Consub further undertakes projects that comprise underwater and naval technology, high quality resources and qualified professionals. Unique solutions have been implemented but each new project brings new challenges to overcome. View the company web at www.consub.com.br Below is an overview of the firm contracts and options for Big Orange XVIII, five Canadian flagged vessels currently in operation and the smaller Brazilian flagged vessels as of end first quarter 2015:
*The MPSV “Ryan Leet” which is owned by Secunda has not been included in the overview above, as the vessel is currently not in operation. *The OSRV “Marati”, which has been operating in Brazil, is currently not in operation. The vessel is not marketed for new employment and will be phased out of the fleet. The vessel is 100% equity financed and has been fully depreciated in the fixed assets.
2015 2016 2017 2018
Vessel Type Ownership 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Big Orange XVIII WSV 41 %Burin Sea AHTS 50%
Panuke Sea PSV 50%
Trinity Sea AHTS 50%
Venture Sea AHTS 50%
Scotian Sea MPSV 50%
Total order backlog in % and USD mill. 90% 24 35% 13 18% 7 0% 0
Marati OSRV 100 %Siem Maragogi OSRV 100%Parnaiba FSV 100 %Propriá FSV 100 %Capela FSV 100 %Siem Piatã FCV 100 %Siem Pendotiba FCV 100%Siem Caetes FSP 100%Siem Carajas FSP 100%
Total order backlog in % and USD mill. 90% 20 89% 26 89% 26 73% 24
Contract Contract option Spot work Contract with subsidiary
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Existing contract coverage and contract backlog for Siem Offshore OSV
The existing contract coverage for each of the vessel categories as of end first quarter 2015 is as follows:
Existing contract coverage, % 2015 2016 2017 PSVs 64% 43% 23% OSCVs * 89% 80% 72% AHTS vessels 13% 5% Brazilian-flagged vessels 90% 89% 89% Secunda 90% 35% 18% Big Orange XVIII 100% 8% - * Existing contract coverage reflects the sale of "Siem Daya 1" in August 2015.
The total contract backlog of firm contracts for the Offshore Support Vessels segment at 31 March 2015 was USD1.41 billion, including Big Orange XVIII, Secunda and the vessels under construction, and is allocated as follows:
2017 (Amounts in USD millions) 2015 2016 onwards Backlog 194 258 955
5.5.3 Siem Offshore Industrial Investments
Siem Offshore Industrial Investments consists of Siem Offshore Contractors, “JOIDES Resolution”, Siem WIS, the combat management business in Brazil and certain other investments. Siem Offshore Contractors (SOC) SOC is an experienced submarine cable and umbilical installation, repair and maintenance contractor serving the worldwide offshore oil and gas as well as renewable energy industries. SOC, a German company with its head office situated in the City of Leer, was formed in 2003. SOC has gained great experience in providing its service to the demanding worldwide offshore oil and gas industry, meeting the highest industry standards for quality, health, safety and environmental protection. This has been of value when winning contracts in the renewable energy sector. Based on its in-house resources as well as experience, SOC can install, maintain and repair submarine cables as well as subsea umbilical in many water depths and geographical areas. View the company web at www.siemoffshorecontractors.com
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Below is an overview of the main projects of SOC as if end first quarter 2015:
*The Nordsee One OWF project reached financial close in April 2015 but was awarded to SOC in April 2014. Overseas Drilling Ltd. (“JOIDES Resolution”) The vessel “JOIDES Resolution” is owned 100% by Overseas Drilling Limited, of which the Company owns 100%. The vessel is a highly specialized research drill ship, whose primary mission is to recover core samples for scientific purposes. The vessel is currently on contract with Texas A&M Research Foundation ("TAMRF") for the use as a scientific core drilling vessel for the International Ocean Discovery Program. The operational firm phase of the contract ended in fourth quarter 2013, and TAMRF has since then exercised three of the initial 10 yearly options. In June 2015, TAMRF declared the third one year option for the vessel, and the current option period under the existing contract will expire at the end of September 2016. A series of seven 1-year option periods is still to be exercised by the TAMRF. Below is an overview of the firm contracts and options for “JOIDES Resolution” as of end first quarter 2015*:
* The option period declared by TAMRF has been graphically included in the above overview, but not reflected in the total order backlog in terms of USD million and per cent. Siem WIS AS Siem WIS AS is 60% owned by Siem Offshore, and is a Norwegian Oil Service Company which has developed and commercialized new unique drilling technology for Underbalanced Operations ("UBO") and MPD. Subject to a successful development, the products will enable safer and more efficient drilling and well maintenance services, including riser-less subsea intervention services from vessels.
Amrumbank West OWF Baltic 2 OWF Nordsee One Nordsee One OWF
Project
Project phase
Vessel utilisation
Profit recognition
Awarded
Installation of 86 submarine cables providing the inner-array grid connecting
All cables have been installed with cable termination, testing and post-lay trenching works ongoing.
PSV “Siddis Mariner”
ISV “Siem Moxie”
AHTS “Siem Garnet”
3rd Party Vessel
The project is scheduled to be completed within 2Q 2015 with a positive margin.
Mar, 2012
Consortium EPIC contract for the 155kV export cable system Nordsee One
Planning, preparation and engineering. The project remains on track for mechanical completion by 3Q 2016.
Utilising the resources within the Siem Offshore Group
At minimum 25% completion. No margin will be recorded prior to installation activities. Project scheduled for completion during 4Q 2016.
Dec, 2012
Installation of 86 submarine cables providing the inner-array grid connecting
All cables have been installed with cable -termination, testing and post-lay trenching works completed in May 2015.
PSV “Siddis Mariner”
ISV “Siem Moxie”
AHTS “Siem Garnet”
3rd Party Vessel
The project is scheduled to be completed during 3Q 2015 with a positive margin.
Feb, 2013
Turnkey EPIC package of the inner array grid cable system for 54 wind turbine generators
Planning, preparation and engineering expected complete in 2Q 2015. Offshore installation from 2Q 2016.
Utilising the resources within the Siem Offshore Group
At minimum 25% completion. No margin will be recorded prior to installation activities in 2016. Project scheduled for completion during 1Q 2017.
Apr, 2014 *)
Veja Mate OWF
Turnkey EPIC package of the inner array grid cable system for the 67 wind turbine generators
Planning, preparation and engineering.
Utilising the resources within the Siem Offshore Group
At minimum 25% completion. No margin will be recorded prior to installation activities in 2016. Project scheduled for completion during 2017.
Apr, 2015
2015 2016 2017 2018
Vessel Type Ownership 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Joides Resolution SPV 100 %
Total order backlog in % and USD mill. 66% 13 0% 0 0% 0 0% 0
Contract Contract option Spot work Contract with subsidiary
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With the technology, challenging reservoirs such as HPHT (High Pressure High Temperature) and ERD (Extended Reach Drilling) wells, will be drilled with better control of your first barrier. These companies services are increasing due to global challenges with depleted reservoirs, drilling of additional and infield wells, and the demand to achieve a more constant well pressure during drilling and tripping operations. View the company web at www.siemwis.com Contract Backlog for Siem Offshore Industrial Investments The total contract backlog for the Industrial Investments segment at 31 March 2015 was USD 166 million and is allocated as follows:
2017 (Amounts in USD millions) 2015 2016 onwards Siem Offshore Contractors 69 76 8 JOIDES Resolution 13 - -
The backlog of Siem Offshore Contractors is normally based on lump sum contracts, while the backlog of “JOIDES Resolution” is based on a firm contract period with an agreed charter rate per day.
5.6 Material agreements
The Company believes that all of its contracts, including its financing arrangements and newbuilding contracts are material for its business. However, the Company does not consider itself dependent upon any one contract in particular.
5.7 Recent trends developments
The North Sea PSV and AHTS vessel markets are continuing to experience soft rates and utilization. Additional vessels have entered the North Sea from other regions and as rig activity is reduced, this places pressure on vessel utilization and fixture rates. Vessel owners have placed vessels in lay-up and owners are considering additional lay-ups. The market for OSVs in Brazil has significantly softened following lower demand activity from Petroleo Brasileiro SA (“Petrobras”). When disclosing its five year business plan, Petrobras announced reduced capital expenditures and highlighted cost cutting measures with the intension to reduce leverage going forward. In order for Petrobras to reduce its cost base, there is an increased risk that Petrobras will initiate renegotiation of existing contracts with suppliers, including vessel owners. It is in the opinion of the Company that an increased risk of such contract renegotiations or even contract cancellations for certain vessels of the Company exists. The outlook for the OSV market is expected to remain soft for several years due to reduced investments in the offshore oil and gas industry following lower current and future commodity prices for oil and gas, which again reduces the demand for vessels and puts pressure on utilisation and fixture rates, coupled with increased supply of vessels as more vessels under construction are delivered from yards. In response to the soft OSV market, the Company has decided to take two vessels, “Siem Aquamarine” and “Siem Diamond”, out of operations and into lay-up. Siem Offshore Contractors experience steady tendering activity in the OFW market with scheduled marine installation activities taking place in 2017 and 2018 and for operations and maintenance contracts to be awarded in 2015. There has been no significant change in the financial or trading position of the Company since the end of the last financial period for which interim financial information has been published. The Company has in connection with preparing the reporting of its second
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quarter 2015 results considered the fair value of its assets versus the respective book values. It is clear that such considerations will result in impairments on vessel values in the second quarter 2015 results. There has been no material adverse change in the prospects of the issuer since the date of its last published audited financial statements.
5.8 Investments
The Company has 9 vessels under construction, of which six vessels are under construction in Poland with Remontowa Shipbuilding, two in Germany with Flensburger Schiffbau-Gesellschaft and one in Brazil with ETP Shipyard with completion at Wilson & Sons. These 9 vessels include one OSRV scheduled for delivery in 2015, four dual-fuel PSVs with one for delivery in 2015 and three in 2016, one Cable-Lay Vessel ("CLV") for delivery in 2016, one AHTS vessel for delivery in 2015 and two Well-Intervention vessels for delivery in 2016. All of the vessels under construction will be financed with a combination of mortgage debt and equity. Yard instalments for shipbuilding contracts are normally paid with 20% during construction and 80% at delivery, alternatively 10% during construction and 90% at delivery. The below table provides an overview of the Company’s committed future yard instalments per end of first quarter 2015 and associated secured mortgage debt financing; Amounts in USD million Committed Future Yard Instalments 2015 2016 Total OSRVs – Brazil 8.1 0.0 8.1 PSVs - Poland 54.5 103.3 157.8 CLV – Poland 0.0 55.5 55.5 WIV - Germany 61.2 220.0 281.2 Total Committed Future Yard Instalments 123.8 378.8 502.6
Mortgage Debt Facilities 2015 2016 Total OSRVs – Brazil 4.9 0.0 4.9 PSVs - Poland 44.5 103.3 147.8 CLV – Poland 0.0 53.8 53.8 WIV - Germany 30.6 208.2 238.8 Total Mortgage Debt Facilities 80.0 365.2 445.2 Financed by Equity 43.8 13.6 57.4
The AHTS vessel under construction for Secunda, which is consolidated in the financial statements of the Group according to the equity method, is not included in the table above. Total committed future yard instalments for this vessel is approximately EUR 40 million, the equivalent of approx. USD 45 million. Mortgage debt financing is also secured for this vessel. For an overview of the scheduled time of delivery of the Company’s vessels under construction, please refer to Section 5.5.2 "Presentation of Siem Offshore Inc.—Business activities—Siem Offshore OSV". The Group has made pre-delivery instalments of approximately EUR 31 million, the equivalent of USD 33.7 million, related to vessels under construction since latest audited published financial statements.
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5.9 Principal markets
The principal markets for the Company is currently the North Sea, Brazil, the Gulf of Mexico, the Mediterranean and West Africa. The following is the management’s assessment of the Company’s position in different areas:
5.9.1 The North Sea
Siem Offshore holds a strong position and market share in this region, with focus on supply services by AHTS, PSV and OSCV. Furthermore, Siem Offshore recently delivered its first dual fuelled PSV, for the use of either LNG or Marine Diesel Oil, to Total E&P Norge AS and a "sister vessel" will be delivered to A/S Norske Shell in second half of 2015. Both vessels will have the most modern solutions for fire-fighting and emergency preparedness and are chartered out on multiple year contracts.
5.9.2 Brazil
General
The Brazilian market is highly regulated and only locally established companies are allowed to operate there. Currently there are approximately 490 vessels operating, of which approximately 50% is Brazilian flagged, while the foreign vessels are all under temporary import conditions. There are offshore drilling and production activities all along the thousands of miles of the Brazilian coast, but the main oil provinces are Campos Basin, offshore Macaé (by far the largest), Sergipe Basin offshore Aracaju and Rio Grande do Norte, offshore Guamaré. Siem Offshore Do Brazil has onshore facilities in Macaé and Aracaju. Promising new areas are Santos Basin and Vitória Basin. The main client is Petrobras, the state-controlled oil company, but there are other oil companies expanding its offshore activities in Brazil, among them Shell, BP, TOTAL, CHEVRON, STATOIL, Queiroz Galvão, etc. Most of the contracts are long term, being up to eight years term for new building vessels to two/four years for foreign vessels. The spot market is still limited, but is expected to develop in the coming years. There are currently 150 Offshore Support Shipping companies duly authorized by ANTAQ governmental agency, however, the main players are in the number of 50 companies and several are subsidiary of major international players. The Company has during 2015 scaled down its operations in Brazil following four AHTS vessels ending firm contracts with Petrobras without further extension.
Engineering Services
Siem Offshore Do Brazil is also a main provider of specialized engineering services to the Brazilian Navy. Among its successfully contracts are: the Combat Management Systems supply for six frigates of Niteroi class, the Combat Management Systems supply for the Barroso corvette, the Combat Management Systems supply for the aircraft carrier São Paulo, and several other jobs related to system integration, simulators and navy specialized training. Besides, there are actions on course to apply these engineering capabilities on the oil and gas market, seeking future opportunities.
5.9.3 The Gulf of Mexico, the Mediterranean and West Africa
The Company has successfully entered into the market in West Africa, which is expected to grow over the coming years, with demand for different types of vessels for general support, maintenance and special services.
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The Company has successfully operated in the market in the Gulf of Mexico for about two years. It is expected that this market will grow over the coming years, with strong demand for different types of vessels for general support, maintenance and special services.
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6. INDUSTRY OVERVIEW
This section discusses the industry in which the Group operates, which is the offshore support vessel industry. Certain parts of the information in this Section relating to market environment, market developments, growth rates, market trends, industry trends, competition and similar information are estimates based on data compiled by professional organizations, consultants and analysts; in addition to market data from other external and publicly available sources, and the Company's knowledge of the markets, see Section 4.1.2 "General information—Industry and market data". The following discussion contains Forward-looking Statements, see Section 4.3 "General information—Forward-looking statements". Any forecast information and other Forward-looking Statements in this Section are not guarantees of future outcomes and these future outcomes could differ materially from current expectations. Numerous factors could cause or contribute to such differences, see Section 2 "Risk factors" for further details.
6.1 Introduction
Offshore support vessels perform a wide range of services related to construction and decommissioning work, pipe laying, support of drilling rigs and floating and fixed installations. Offshore support vessels can be divided into three main segments; AHTS, PSVs, and various types of offshore subsea vessels (OSCVs), which are further described in Section 6.3, "—The Offshore Support Vessel market". The Group owns vessels in all of the above segments. Demand for PSVs are mainly related to support of offshore platforms, rigs and floating production units, with respect to transporting cargo between such installations/units and supply bases onshore. PSVs have liquid tanks, dry bulk tanks and deck area for transportation of various cargoes such as mud, brine, cement, water, oil, diesel, pipes food, and other supplies related to production/operation of the offshore rigs/platforms. AHTS vessels can perform the same duties, but are equipped with winches and towing capacity, enabling them to lift and position anchors, tow rigs and floating production units that either cannot propel themselves, or where towing is more economical due to fuel costs. Towing of new fixed platforms or cargo barges are also relatively frequent tasks for these vessels. A large portion of AHTSs’ duties is related to anchoring up offshore rigs and floating production units. Even though many new rigs have DP systems that enable them to hold their position using navigation systems and own thrusters, and thus do not necessarily require the use of anchors, such DP systems require the constant use of the rig’s engines, it is often more economical to be anchored up, especially if the rig is expected to be in the same position for several weeks. OSCVs comprise of pipelay vessels, dive support vessels, heavylift / derrick barges, offshore construction vessels, seismic support vessels, Well-Intervention Vessels and survey vessels. These types of vessels are normally utilized in the installation, light construction, inspection, and maintenance and decommissioning of subsea equipment related to the development of oil and gas offshore. The vessels may also be utilized within certain non-oil and gas related segment, e.g. the offshore wind industry.
6.2 Demand and key drivers
The key demand drivers for offshore support vessels are the level of activity and investments in the oil and gas sector. The oil companies’ exploration and production activities, normally referred to as “E&P spending”, are based on the world’s demand for oil and gas. Furthermore, demolition of old platforms and installations and remedial work (e.g. in the US Gulf after hurricane damages) are new important areas of work for offshore support vessels. Together with a massive growing maintenance requirement on existing drilling units, installations and pipelines worldwide due to ageing and corrosion and need for repair and upgrading, this also has great influence on the demand for
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offshore support vessels. The below chart shows the Brent oil price development since 2010 as well as the forward curve. Brent oil price (USD/bbl)
Source: Managers Research, Ecowin, Bloomberg (June 2015) In the years 2011 to 2013, oil prices (Brent) have traded in the USD 90/bbl to USD 120/bbl range, with yearly averages being stable around USD 110/bbl. This was a supportive level for an increasing spending environment. In mid 2014 the oil price peaked at around USD 115/bbl and from there the oil price saw a dramatic fall down to about USD 50/bbl around year end 2014. During 2015 oil prices have been volatile and trading in the range of around USD 50-65/bbl. The forward curve shows points to a gradual and modest increase in oil prices over the next years, with an average price of USD 68 and 70/bbl for 2016 and 2017, respectively. The level of E&P spending is a function of the prevailing oil prices. Naturally, the dramatic fall in the oil price has forced oil companies to reduce their investments and overall offshore activity. With years of stable oil prices above USD 100/bbl, the oil companies budgeting prices have increased and hence, with the current oil price environment, many projects that previously were profitable are now under review. On the other hand, reduced activity and oil production should over time help the market balance and gradually provide support for increasing oil prices again. Below table shows the historic global E&P spending growth. Global E&P spending growth
Source: Mangers Research, based on IHS, Schlumberger, Citigroup (June 2015)
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As seen in the above chart one saw strong growth in E&P spending in the years prior to the financial crisis with annual growth rates of 15-21% in the period 2005-2008. Following the financial crisis E&P spending saw a 12% decline in 2009 before bouncing back to double digit growth in the period 2010-2012. In 2014 E&P spending growth was down to 2% while 2015 is expected to show a double digit decline. Going forward, E&P spending growth is naturally dependent on the development in oil prices. Currently there is a lot of uncertainty in the market with oil companies holding back on their investments and hence providing limited support for a quick rebound to historic growth. Another key driver for the offshore support vessel market is the offshore drilling activity. Floater rigs demand (# rigs)
Jack-up rigs demand (# rigs)
Source: Managers Research, based on HIS Petrodata (June 2015) As seen from the above charts, the demand for drilling rigs has declined substantially over the last months, both for floaters and jack-ups, and thus providing a challenging market backdrop for the offshore support vessels.
6.3 The Offshore Support Vessel market
6.3.1 General introduction
The offshore support vessel (OSV) market can be divided into several categories and segments. The main categories are platform supply vessel (PSV), anchor-handling tugs supply (AHTS) and offshore subsea construction vessels (OSCV). In addition, there are various niche segments being more specialized. The Group owns and operates vessels within all these categories. The market for offshore support vessels is fragmented across segments and regions, with many owners owning/controlling fleets that can be characterized small to medium in terms of both size and global reach. Excluding the smaller sizes in PSV and AHTS and extracting PSV > 3,000 dwt and AHTS > 12,000, the top 5 operators controlled 29% of the global fleet. Top 3 players Edison Chouest (US), Tidewater (US) and Bourbon Offshore (FR) each control 5-10% of the global fleet. An overview of the larger companies within the PSV/AHTS market is shown below. Siem Offshore ranks among the top 15 within this group, but with the larger operators controlling significantly more
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vessels. Within the OSCV segment there is various sub segments, including pipelay vessels, dive support vessels, offshore construction vessels, survey vessels, Well-Intervention Vessels etc. Below is a graphic showing examples of large suppliers of PSV/AHTS vessels (not exhaustive). Largest operators, combined AHTS/PSV (>3000 Dwt and > 12000 BHP)
Source: Managers Research, based on HIS Petrodata (June 2015)
6.3.2 Regional overview
The North Sea area consists mainly of the continental shelfs of Norway, United Kingdom, Denmark and Netherlands. Due to the large number of oil companies and limited distances in the region (Barents Sea being an exception), the market has seen a large spot market both within the PSV and AHTS segment develop since the 80s. In addition, the market provides opportunities for various term contract lengths various from months to several years. While Statoil has a large share of the market in Norway, the market is well diversified in terms of oil- and service-companies. With the well functioning spot market, the region is often referred to as a reasonable proxy on the overall global supply/demand balance since idle vessels in other regions (mainly Med’, West-Africa and Brazil) tend to migrate into the region. Brazil is one of the key markets for offshore support vessels. The market is characterized by the national oil company Petrobras being the dominant player and historically offering long-term contract opportunities in various segments, attracting operators on a global basis. The region has a limited spot market and term contracts have been in the range of 1-8 years. The country offers preference towards locally built tonnage both on contract duration and by differentiating tender processes. Brazil is also highly regulated in terms of local content requirements. USGOM is characterized by the Jones Act regulation for the PSV and AHTS segment, which means operators need to comply with this act to be able to qualify for operations in this region. Consequently, the region is only served by US operators. With the Jones Act follows also a large domestic shipbuilding industry. The region holds a large spot market as well as a term market with various contract durations. West Africa holds various regional markets related to each country in the region. The largest markets being Angola and Nigeria. Each market is unique in terms of local
0 20 40 60 80 100 120 140 160Edison Chouest
TidewaterBourbon Offshore
Maersk Supply ServiceFarstad
Swire PacificGulfMark
DOFDeep Sea Supply
COSLCBO
HornbeckSiem Offshore
Solstad ShippingVroon
Island OffshorePOSH SemcoTopaz Marine
Harvey Gulf International MarineHavila
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content requirements. The region offers smaller spot markets, but by nature is characterized as various terms markets. The region may offer certain challenges related to logistics, including dry-docking and maintenance of vessels/equipment. Asia is similar to West Africa in terms of various local/regional markets. While the port of Singapore provides a regional hub for vessels standing idle or in-between contracts, there is no single spot market in the region and also term markets are characterized by the country of operation. The market is also characterized by being the largest new build market in the offshore support vessel industry with the key build country being China.
6.3.3 Platform Supply Vessels
The supply vessel market is usually divided into two main areas, namely vessels for towing and anchor handling, and for general supply to offshore units (rigs, barges, fixed installations or shore bases), in the industry called general supply duties. Such tasks can be carried out by both AHTS vessels and PSVs. However, the operation of a PSV is as a main rule limited to carry out storage duties and supply duties. Both categories of vessels can be divided further into sub segments according to their capabilities, as a number of such vessels do have cross-over capacities into other categories and related segments. Oil Recovery, Fire Fighting, ROV Surveys and Standby ERRV services are some examples of such capacities. The market for offshore vessels was very strong in most of 2005-2008, reaching record levels in the North Sea. The market has been more volatile since 2009 with generally lower and more fluctuating fleet utilization, and as a result, also fluctuating day rates for the vessels. PSVs are specifically designed for transport of all required supplies, either as deck cargo or under deck in dedicated tank systems to and from offshore installations. On deck the vessels may carry containers, drill pipes and other equipment. Under deck the vessels may carry a variety of different fluids in separate tanks, like mud & brine, cement or other dry bulk, fresh water, fuel and/or special products like methanol and drill cuttings for the drilling program. PSVs are mainly classified according to the following capacities:
- Size of free deck area
- Total carrying capacity in dead weight tons (dwt)
- Type and capacity of special tanks carrying mud & brine, fuel, dry bulk, methanol etc.
Historically, a PSV with dwt above 2,000 have been considered large. However, as the trend continues towards larger and larger vessels, PSVs with dwt between 3,000 and 4,000 are now considered medium-sized and vessels with a carrying capacity above 4,000 dwt are considered large. Classified by deck area, this corresponds to approximately 500-800 m2 for medium-sized vessels, and above 800 m2 for large vessels. Siem Offshore currently has twelve PSVs in operation, of which six can be classified as medium size, and six are classified as large. Furthermore, Siem Offshore has four large PSVs under construction. The PSV segment has seen substantial contracting of newbuilds over the last years and there are still quite a large number of vessels with scheduled delivery in 2015 and 2016. It is worth mentioning that a substantial part of the order book consists of smaller and less advanced vessels mainly under construction in the Far East and one should expect
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significant delays as well as potential cancellations. Potentially mitigating the order book is the relatively significant number of vessels built in the 1980s still in service. We have already seen an increasing number of older vessels being phased out, and given the current challenging market, this trend is likely to continue. Worldwide PSV fleet by building year
Source: Managers Research, based on IHS Petrodata (June 2015)
6.3.4 Anchor Handling Tug-Supply vessels
AHTS vessels are specifically designed for towing and anchor handling operations of rigs and other offshore units. Furthermore, the vessels are often prepared for fire fighting (FiFi), rescue operations (standby) and oil recovery (ORO) capabilities, as well as additional opportunities like crane for ROV operations, A-frame, large AHC crane for construction and deepwater work. The AHTS is, like a PSV, also used for general supply service between shore bases and platforms, transporting different types and grades of cargo both on deck, as well as under deck in tank systems. In the case where the oil activity is in deeper waters, the anchor handling operations become heavier and focus is put on the power of the AHTS vessels, station keeping and winch capabilities, in addition to the vessels stability, capacities and functionality in general. A general trend for the segment has been to provide for safer and more efficient operations in more challenging conditions, as well as various HSE issues for safer operations for the vessels crew. AHTS vessels are mainly rated according to their towing and anchor handling capacities and capabilities, propulsion and bollard pull. Break horse power (BHP) is the most common parameter for categorizing AHTS vessels. The AHTS fleet is normally divided into vessels with less than 12,000 BHP (small sized), between 12,000 and 16,000 BHP (medium size), between 16,000 and 20,000 BHP (large) and above 20,000 BHP (very large). Owners have traditionally focused on vessels with between 12,000 and 18,000 BHP, but with a push in recent years for the larger vessels above 20,000 BHP. Due to the fact that the offshore industry has increased its presence in deeper water and outer areas where more and special capacity will be required, and also to be able to work in various markets, Siem Offshore has decided to focus on the high-end of the AHTS market, i.e. vessels above 20,000 BHP. In 2011 Siem Offshore completed a new build program of ten AHTS vessels in the category "very large", of which eight vessels are owned by Siem Offshore. The AHTS newbuilds are of VS 491 design, which meets the current and future requirements of the industry serving the next generation of drilling rigs and floaters for global offshore and deep water work. The AHTS vessels are of designs promoting favorable fuel consumption and consequently low emissions as a result of their optimal hull lines, Selective Catalysts Reduction (SCR) and hybrid propulsion, high speed and large all round capacities. The
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AHTS newbuilds have bollard pull of 275 tons, prepared for ROV operations, 60 men accommodation and have a lot of optionality such as A-frame (300t), large AHC crane (300t) etc. Similar to the PSV market, there are also quite a number of AHTS vessels under construction with the majority being scheduled for delivery in 2015 and 2016. Also for the AHTS vessels, a large number of vessels are smaller and less sophisticated vessels being built in the Far East where one should expect delays and potential cancellations. There are also a large number of AHTS vessels that are built in the early 1980s which in the current market environment are obvious phase out candidates. Worldwide AHTS fleet by building year
Source: Managers Research, based on IHS Petrodata (June 2015)
6.3.5 Offshore Subsea Construction Vessels
OSCV, often quoted as subsea vessels, are utilized in the installation, light construction, inspection and maintenance of subsea equipment related to the extraction of oil and gas offshore. The vessels may also be utilized within certain non-oil and gas related segment, e.g. the offshore wind industry. The OCSVs can further be divided into various subcategories:
- Pipelay Vessels; - Dive Support Vessels - Heavylift/Derrick Barges - Offshore Construction Vessels - Seismic Support Vessels - Well-Intervention Vessels - Survey Vessels
Siem Offshore currently has a wide range of vessels in the OSCV category, including a series of four vessels operating in the subsea support/IMR role along with two MRSV (Multipurpose field & ROV support vessels). The Group also has certain vessels in operation and under construction targeting the offshore wind market and the well intervention market. The OSCV segment in today’s form is a relatively new segment as the majority of vessels have been ordered since the mid 2000s following the oil company’s focus on subsea solutions. There are however quite a few older vessels, but these are generally less sophisticated and not comparable to standards seen on modern vessels. Prior to the financial crisis there was large ordering activity with vessels being delivered in 2008 and 2010. Newbuild deliveries then saw a drop to around 40 vessels per year in 2011 to 2013
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before increasing to around 50 vessels in 2014. For 2015 and 2016 the number of vessels scheduled for delivery is estimated to increase to around 70-80 per year. Delivery of construction vessels*
Source: Managers Research, based on HIS Petrodata June 2015) *Accommodation, Bury/Trench, Derrick, Derrick Pipelay, Diving support, Multiservice, Pipelay, ROV Support, Support, Well Intervention Over the last years there has been a lot of subsea activity. The chart below shows the total subsea order intake for the three major subsea contractors from 2003 to 2014 which represents a good indication with respect to demand for subsea vessels. As seen from the chart their order intake was relatively stable at around USD 15 billion per year in the period 2006 to 2010, while increasing to around USD 26 billion in 2014. Following the collapse in oil prices lately, 2015 is likely to show a significant decline compared to 2014. Subsea order intake (USDbn)
Source: Managers Research (June 2015)
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6.4 Rate development and utilisation
The offshore support vessel market is cyclical, and spot market rates in the North Sea region are characterized by significant volatility. This relates mostly to the underlying cyclicality of the business, but also to variations between summer and winter season and to changes within shorter time periods. In particular, the summer season is generally characterized by high activity levels. To a large extent, this can be attributed to the weather conditions in the North Sea Region. The current spot rates for PSVs in the North Sea are very low and insufficient to cover costs. The weak market has triggered several operators to lay up vessels in order to cut losses. Rates for longer contracts generally fluctuate less, but is highly correlated with the spot market. As mentioned above, the regions outside the North Sea do not have as visible and efficient spot market. The development and status in the North Sea region gives a good indication of the conditions of charters elsewhere in the world. Other regions are characterized more by medium to long term charters, but facing the same negative trends on both rates and utilization as seen in the North Sea area. While the industry trend has been operators having preference for newer and more efficient vessels (both fuel and operational) and consequently improving utilization vs. older tonnage, the weak market trends are seen across vessel segments (size and age). The following chart shows monthly average spot rates from 2002 until today for large AHTS vessels: AHTS spot dayrates (monthly average, GBP/d)
Source: Managers Research, based on Clarksons (June 2015) North Sea AHTS rates have seen large fluctuations in recent years with a gradually softening late 2014 and into 2015, although shorter periods of tightness are still observed. With softer activity levels, market participants also prepare for soft markets by stacking vessels as also is the case in the PSV segment.
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The figure below shows the corresponding data for large PSV vessels: PSV spot dayrates (monthly average, GBP/d)
Source: Managers Research, based on Clarksons (June 2015) The PSV spot market has been weak since late 2014 and North Sea PSV rates are touching levels not seen since 2002-04 and briefly in 2009-10. On an overall basis the combined utilization of AHTS and PSVs have been around 90% in the years following the financial crisis except for 2014 when utilization dropped to around 88%. The market has further deteriorated in 2015 and currently a significant number of vessels have been put in lay-up as a consequence of lower activity amongst oil companies and too many available vessels in the market. Overall PSV /AHTS fleet utilization chart (North Sea)
Source: Managers Research, based on IHS Petrodata (June 2015)
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The below table shows the overall contract awards for construction vessels, both shown for number of awards as well as volume measured in days. While the number of awards has increased relatively steadily since 2007, the average contract length (volume) has declined sharply since 2013, potentially reflecting tougher competition. Contract awards construction vessels*
Source: Managers Research, based on HIS Petrodata June 2015) *Accommodation, Bury/Trench, Derrick, Derrick Pipelay, Diving support, Multiservice, Pipelay, ROV Support, Support, Well Intervention
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7. CAPITALISATION AND INDEBTEDNESS
The information presented below should be read in conjunction with the other parts of this Prospectus, in particular Section 8 "Selected financial and other information", and the Group's financial statements and the notes related thereto, included in Appendix B of this Prospectus. Other than as set forth as above, there has been no material change to the Group’s unaudited consolidated capitalisation and net financial indebtedness since 31 March 2015.
7.1 Capitalisation
The following table sets forth information about the Group’s consolidated capitalisation as at 31 March 2015.
As of 31 March 2015
In USD 1000 (unaudited)
Indebtedness
Total current debt: 362 091
Guaranteed and secured ....................................................................... 192 624
Guaranteed but unsecured .................................................................... 0
Secured but unguaranteed .................................................................... 0
Unguaranteed and unsecured ................................................................ 169 467
Total non-current debt: 1 038 532
Guaranteed and secured ....................................................................... 877 830
Guaranteed but unsecured .................................................................... 0
Secured but unguaranteed .................................................................... 0
Unguaranteed and unsecured ................................................................ 160 702
Total indebtedness ............................................................................ 1 400 623
Shareholders’ equity
Paid in capital ...................................................................................... 526 236
Other reserves ..................................................................................... -86 796
Retained earnings ................................................................................ 279 060
Non-controlling interests ....................................................................... 36 497
Total shareholders’ equity ................................................................. 754 997
Total capitalisation ............................................................................ 2 155 619
7.2 Net financial indebtedness
The following table sets forth information about the Group’s net financial indebtedness as at 31 March 2015. As of
31 March 2015
In USD 1000 (unaudited)
(A) Cash ........................................................................................... 89 668
(B) Cash equivalent (Detail) ................................................................ 0
(C) Trading securities ......................................................................... 0
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As of 31 March 2015
In USD 1000 (unaudited)
(D) Liquidity (A)+(B)+(C) ............................................................... 89 668
(E) Current Financial Receivable ..................................................... 234 985
(F) Current Bank debt ........................................................................
192 624
(G) Current portion of non-current debt ................................................ 0
(H) Other current financial debt ........................................................... 169 467
(I) Current Financial Debt (F)+(G)+(H) ......................................... 362 091
(J) Net Current Financial Indebtedness (I)-(E)-(D) ........................ 37 437
(K) Non current Bank loans ................................................................. 810 700
(L) Bonds issued ............................................................................... 160 702
(M) Other non-current loans ................................................................ 0
(N) Non-current Financial Indebtedness (K)+(L)+(M) .................... 971 402
(O) Net Financial Indebtedness (J)+(N) .......................................... 1 008 839
The loan facilities established to finance the construction and acquisitions of the Company's vessels are secured by, a first priority mortgage on the applicable vessels, and in most cases also security in earnings, charter contracts, insurance and hedging arrangements. As of end first quarter 2015, the Company had approximately USD 160 million in outstanding unsecured bond debt with maturity in January 2018 and March 2019.
7.3 Working Capital Statement
As of the annual reporting for the fiscal year 2014, the Company was of the opinion that it had sufficient working capital for the next 12 months based on the assumptions of the OSV market at that time. Based on an unfavourable development and assumed continued soft OSV market, the shortfall for the Company’s working capital is currently expected to materialize in second half of 2015 given regular debt schedule payments and payments related to the existing newbuilding program. Accordingly, it is the Company's opinion that the Group at present time does not have sufficient working capital for its current requirements, i.e. for the next 12 months. In order to prepare the Company for the expected soft OSV market and meet the Group's current debt obligations and make payments under the Group's newbuilding program for a period of twelve months from the date of this Prospectus, the Company is dependent on additional financing of approximately USD 100 million. The additional financing will be raised through the fully underwritten Rights Offering as described in this Prospectus. As further described in Section 13.20 "The Rights Offering—The underwriting", the underwriting commitment of Siem Europe S.a r.l. for the Rights Offering is conditional upon certain events not taking place. The Company is confident that the Rights Offering will be successful, or that if it is unsuccessful, that the Company may call upon the underwriting commitment.
52
7.4 Debt instalments falling due over the next 5 years, as of year-end 2014.
The book value of mortgaged assets consisted of non-current tangible assets and portion of the accounts receivables and amounted to USD 1,764 million at year end 2014. For the first 3 months of 2015 the company has repaid debt in the amount of approximately USD 25 million and drawn approximately USD 1 million. Current cost of debt is approximately 4.5% p.a., including the effect of interest rate derivatives. In July 2015, the company announced that it had received approval from all of its financing banks for the finance plan of the Company. The approvals includes a three year extension of the Company's NOK 2.5 billion credit facility for six anchor handling tug supply vessels, which was due to expire in November 2015. As a result of this, a balloon repayment of approximately USD 200 million maturing in 2015 in the table above will not materialize, but the facility will continue on existing repayment profile until 2018. Thus, accordingly reducing the applicable balloon repayment in 2018. The Company will finance its debt and yard commitments, for the remaining period with vessels under construction, through the proceeds of this Rights Offering, existing capital and revenue generated through the ordinary course of business
7.5 Contingent and Indirect Indebtedness
As at 31 December 2014 the Group had the following contingent or indirect indebtedness in the form of guarantees.
1) Contractual guarantees to the Brazilian Navy are issued by Siem Offshore do Brasil SA. 2) Contractual guarantees provided by the Company are security for contracting parties of Siem Offshore Contractors GmbH. Such guarantees are for advance payments received at USD 27.3 million and performance guarantees at USD 109.3 million and guarantees related to tax cases in Brazil of USD 4.7 million.
Parent Company ConsolidatedInstalments per December 31, 2014 Mortgage Other interest
(USD 1000’) falling due over the next 5 years debt bearing debt Total
- 2015 308 902 - 308 902 - 2016 99 623 - 99 623 - 2017 118 926 - 118 926
80 719 2018 282 909 80 719 363 628 94 172 2019 75 975 94 172 170 147
- Thereafter 166 380 - 166 380 174 891 Total 1 052 714 174 891 1 227 605
Parent company Consolidated12/31/2014 12/31/2013 (Amounts in USD 1,000) 12/31/2014 12/31/2013
- - Contractual guarantees to Brazilian Navy (1) 593 4 304 106 131 120 291 Contractual guarantees other (2) 141 315 150 014 106 131 120 291 Total guarantees 141 908 154 317
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8. SELECTED FINANCIAL INFORMATION
8.1 Introduction and Basis for Preparation
The following selected financial information have been extracted from the Group's audited consolidated financial statements for the year ended 31 December 2014 and for the three months periods ended 31 March 2014 and 2015. These financial statements are prepared under the International Financing Reporting Standards ("IFRS") as approved by the European Union. The interim financial statements for the three months periods ended 31 March 2014 and 2015 are unaudited.
8.2 Summary of Accounting Policies and Principles
For information regarding the Group’s accounting policies under IFRS and the use of estimates and judgements, please refer to the notes of the Group's consolidated financial statements prepared under IFRS for the year ended 31 December 2014, included in this Prospectus as Appendix B.
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8.3 Consolidated Income Statements
The table below sets out selected data from the Group’s consolidated income statements for the year ended 31 December 2014 and for the three months period ended 31 March 2015.
Consolidated Income Statements 2015 2014
(Amounts in USD 1 000) Jan-Mar Jan-DecUnaudited Audited
Operating revenues 125 995 491 312Operating expenses -77 096 -250 153Administration expenses -10 160 -47 033Operating margin 38 739 194 125Depreciation and amortisation -26 750 -96 883Impairment of vessels - -29 000Gain (loss) on sales of fixed assets -15 18 728Gain of sale of interest rate derivatives (CIRR) 92 368Gain (loss) on currency derivative contracts -36 052 -3 023Operating profit -23 986 84 316
Financial revenues 2 249 9 091Financial expenses -11 934 -55 868Result from associated companies -553 1 808Net currency gain (loss) 10 022 34 092Net financial items -216 -10 877
Profit/(loss) before taxes -24 203 73 439
Tax benefit / (expense) -1 360 -2 729Net profit/(loss) -25 562 70 710Net profit/ (loss) attributable to non-controlling interest -49 12 563Net profit/ (loss) attributable to shareholders -25 612 58 147Weighted average number of shares outstanding ('000) 387 591 387 591Earnings(loss) per share (basic and diluted) -0.07 0.15
Comprehensive Income Statements 2015 2014(Amounts in USD 1 000) 1Q Jan-Dec
Unaudited AuditedNet profit/(loss) -25 562 70 710Other comprehensive income (expense)Items that will not be reclassified to profit or lossPension remeasurement gain (loss) - 1 510Items that may be subsequently reclassified to profit or lossCash flow hedges -32 392 -14 622Currency translation differences -3 797 -11 100Total comprehensive income for the period -61 751 46 499Net profit/ (loss) attributable to non-controlling interest -48 12 271Net profit/ (loss) attributable to shareholders -61 799 34 228
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8.4 Selected Statements of Financial Position
The table below sets out selected data from the Group’s consolidated statements of financial position as of 31 December 2014 and 31 March 2015.
Consolidated Statements of Financial Position
(Amounts in USD 1 000) 31.03.2015 31.12.2014Unaudited Audited
Non-current assetsVessels and equipment 1 596 220 1 743 693Vessels under construction 127 035 130 515Capitalised project cost 10 022 10 965Investment in associates and other long-term receivables 35 051 43 654CIRR loan deposit 1) 26 145 28 453Deferred tax asset 12 587 12 591Intangible assets 23 905 25 937Total non-current assets 1 830 966 1 995 809Debtors, prepayments and other current assets 130 875 147 152Asset held-for-sale 104 110 -Cash and cash equivalents 89 668 117 623Total current assets 324 654 264 774
Total assets 2 155 619 2 260 584
EquityPaid-in capital 526 236 526 236Other reserves -86 796 -45 491Retained earnings 279 060 304 237Shareholders´ equity 718 500 784 982Non-controlling interest 36 497 38 666Total equity 754 997 823 649LiabilitiesBorrowings 971 402 1 087 757CIRR loan 1) 26 145 28 453Other non-current liabilities 40 985 38 532Total non-current liabilities 1 038 532 1 154 742Borrowings 192 624 126 603Accounts payable and other current liabilities 169 467 155 590Total current liabilities 362 091 282 193
Total liabilities 1 400 623 1 436 935
Total equity and liabilities 2 155 619 2 260 584
1) Commercial Interest Reference Rate
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8.5 Selected Statements of Cash Flows
The table below sets out selected data from the Group’s consolidated statements of cash flows for the year ended 31 December 2014 and for the three months period ended 31 March 2015.
Consolidated Statements of Cash Flows2015 2014
(Amounts in USD 1 000) Jan-Mar Jan-DecUnaudited Audited
Cash flow from operationsProfit before taxes, excluding interest -12 435 117 702Interest paid -13 092 -46 362Taxes paid -1 360 -8 957Results from associated companies 553 -1 808Loss/(gain) on sale of assets 15 -18 728Value of employee services 336 2 462Depreciation and amortisation 26 750 96 883Impairments of vessels - 29 000Effect of unreal. currency exchange forward contracts 27 264 5 612Change in short-term receivables and payables -5 538 19 918CIRR -92 -368Other changes 5 400 -11 010
Net cash flow from operations 27 802 184 345
Cash flow from investing activities Interest received 956 4 171Investments in fixed assets -16 730 -525 674Proceeds from sale of fixed assets 0 76 290 Dividend from associated companies - 278Investment in associated companies -2 251 -12 201
Cash flow from investing activities -18 024 -457 136
Cashflow from financing activitiesProceeds from issue of new equity - 1 336Dividend payment - -6 533Contribution from non-controlling interests of consolidated subsidiaries - -Proceeds from bank overdraft -1 309 5 624Proceeds from new long-term borrowing 1 335 447 701Repayment of long-term borrowing -25 489 -131 936
Cash flow from financing activities -25 463 316 192
Net change in cash -15 686 43 400
Cash at bank start of period 117 621 101 206Effect of exchange rate differences -12 267 -26 985
Cash at bank end of period 89 668 117 621
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8.6 Selected Statement of Changes In Equity
The table below sets out selected data from the Group’s consolidated statement of changes in equity for the year ended 31 December 2014 and for the three months period ended 31 March 2015.
8.7 Segment Information
The Company identifies its reportable segments and discloses segment information under IFRS 8 Operating Segments which requires Siem Offshore Inc. to identify its segments according to the organization and reporting structure used by management. Operating segments are components of a business that are evaluated regularly by the chief operating decision maker for the purpose of assessing performance and allocating resources. The Company’s chief operating decision maker is the management board, comprised of the CEO of Siem Offshore Inc., CFO and Commercial Director. Generally, financial information is required to be disclosed on the same basis that is used by the chief operating decision maker. The Company’s operating segments represent separately managed business areas with unique products serving different markets. The reportable segments are Siem Offshore OSV and Siem Offshore Industrial Investments, with the seven sub segment business areas PSV, OSCV, AHTS Vessels, Other Vessels in Brazil, Submarine Power Cable Installation, Combat Management Systems, Scientific Core-Drilling and Siem WIS. Under Siem Offshore OSV, the PSV segment includes 12 Platform Supply Vessels. The OSCV segment includes four Offshore Subsea Construction Vessels and two Multipurpose field and ROV Support Vessels. The AHTS segment includes ten Anchor Handling Tug Supply Vessels. The Segment of Other Vessels in Brazil consists of one Oil Spill Recovery Vessel and eight smaller Platform Supply Vessels. Under Siem Offshore Industrial Investments, the Submarine Power Cable Installation comprises the activities of installation and maintenance of subsea power cables for offshore windfarms. Combat Management Systems is the activity of supplying software
Consolidated Statement of Changes in Equity
(Amounts in USD 1 000)Total no. of
shares Share capital
Share premium reserves
Other reserves
Retained earnings
Share-holders'
equity
Non- Controlling
interest Total equityEquity on January 1, 2015 387 591 380 3 876 522 361 -45 491 304 237 784 983 38 666 823 649Change previous periods 0 0 0Net profit to shareholders -25 513 -25 513 -49 -25 562Value of employee services 336 336 336Cash flow hedge -32 392 -32 392 -32 392Currency translation differences -8 913 -8 913 1 -8 912Total comprehensive income / (expense) 0 0 -41 305 -25 177 -66 482 -48 -66 531Share issues in partially owned subsidiaries 0 152 152Capital reduction in partially owned subsidiaries -2 274 -2 274Equity on March 31, 2015 387 591 380 3 876 522 361 -86 796 279 060 718 501 36 496 754 997
(Amount in USD 1 000)Total no. of
shares Share capital
Share premium reserves
Other reserves
Retained earnings
Share-holders'
equity
Non- Controlling
interest Total equityEquity on January 1, 2014 387 591 380 3 876 522 361 -19 769 250 161 756 629 37 260 793 888Change previous periods -1 510 -1 510 -1 510Net profit to shareholders 58 147 58 147 12 563 70 710Value of employee services 2 462 2 462 2 462Pension remeasurement 1 510 1 510 1 510Currency translation differences -25 721 -25 721 -293 -26 014Total comprehensive income / (expense) 0 0 -25 721 60 609 34 887 12 271 47 158Share issues in partially owned subsidiaries 0 1 336 1 336Capital reduction in partially owned subsidiaries -12 201 -12 201Buy back of shares 0 0 0 0Dividend paid -6 533 -6 533 -6 533Shares issues in Siem Offshore Inc 0 0Equity on December 31, 2014 387 591 380 3 876 522 361 -45 491 304 237 784 983 38 666 823 649
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for a management system to the Brazilian Navy. Scientific Core-Drilling is comprised of the activity of the scientific drillship, “JOIDES Resolution” which performs core drilling. Siem WIS develops applications for MPD, and certain other investments. The Company uses two measures of segment results, operating revenue and operating profit. Intersegment sales and transfers reflect arm’s length prices as if sold or transferred to third parties at the time of inception of the internal contract, which may cover several years. Transfers of businesses or fixed assets within or between the segments are reported without recognizing gains or losses. Results of activities not considered part of the Company’s main operations as well as unallocated revenues, expenses, liabilities and assets are reported together with Other under the caption Other and intercompany eliminations. The following tables include information about the Company’s operating segments. Segment Reporting by Business Area
2015 2014(Amounts in USD 1 000) 1Q Jan-Dec
Unaudited AuditedOperating revenue by business areaPlatform Supply Vessels (1) 24 619 104 423Offshore Subsea Construction Vessels 30 356 104 844Anchor Handling Tug Supply Vessels (1) 15 480 142 480Other vessels in Brazil 6 715 19 351Other/Intercompany elimination -1 496 -15 854Operating revenue, OSV segment 75 674 355 244
Submarine Power Cable activities 41 023 101 479Combat Management Systems 2 243 6 075Scientific Core-Drilling 6 474 25 914Siem WIS 580 2 601Operating revenue, Industial Investments segment 50 321 136 069
Total operating revenue 125 995 491 312
2015 2014(Amounts in USD 1 000) 1Q Jan-Dec
Unaudited AuditedOperating profit by business areaPlatform Supply Vessels 8 042 35 437Offshore Subsea Construction Vessels 14 238 48 073Anchor Handling Tug Supply Vessels -9 974 39 232Other vessels in Brazil 1 578 -35 343Other/Intercompany elimination 2 628 2 521Operating profit, OSV segment 16 512 89 919
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8.8 Auditor
The Company’s auditor is PricewaterhouseCoopers AS, with registration number 987 009 713 and business address at Dronning Eufemias gate 8, 0191 Oslo, Norway. PricewaterhouseCoopers AS is a member of Den Norske Revisorforeningen (The Norwegian Institute of Public Accountants). PricewaterhouseCoopers AS has been the Group’s auditor throughout the period covered by financial information included in the Prospectus. PricewaterhouseCoopers AS' audit reports on the annual financial statements for the Company for 2014 are included together with the annual financial statements for the Company for 2014 in Appendix B. PricewaterhouseCoopers AS has not audited, reviewed or produced any report on any other information provided in this Prospectus.
p g p g
Submarine Power Cable activities 3 069 15 581Combat Management Systems -25 -8Scientific Core-Drilling 2 666 9 429Siem WIS -73 355Operating profit, Industial Investments segment 5 637 25 357
Administration expenses -10 160 -47 033Currency gain / (loss) -35 976 16 074Total operating profit -23 986 84 316
(1) Platform Supply Vessel category and Anchor Handling Tug Supply Vessel category includeI/C revenue from contracting work for the 100% owned subsidiary "Siem Offshore Contractors GmbHwhich is included in the I/C eliminations in the table above.
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9. BOARD OF DIRECTORS, MANAGEMENT, EMPLOYEES AND CORPORATE
GOVERNANCE
9.1 Board of Directors
9.1.1 Overview
The Articles of Association provide that the Board of Directors shall consist of a minimum of three and a maximum of seven members. As at the date of this Prospectus, the Company's Board of Directors consists of the following: Name of director Director since Current term expires
Eystein Eriksrud (Chairman) 2010 2016
Kristian Siem 2005 2017
Michael Delouche 2005 2016
David Mullen 2008 2017
John C. Wallace 2012 2016
The Board of Directors is in compliance with the independence requirements of the Norwegian Code of Practice for Corporate Governance dated 30 October 2014 (the "Corporate Governance Code"), meaning that (i) the majority of the shareholder-elected members of the Board of Directors is independent of the Company’s executive management and material business contacts, (ii) at least two of the shareholder-elected members of the Board of Directors are independent of the Company’s main shareholders, and (iii) no members of the Company’s executive management are on the Board of Directors. Eystein Eriksrud, Kristian Siem and Michael Delouche represent the Company's main shareholders, Siem Europe S.a r.l., and are not considered as independent. David Mullen and John C. Wallace are both considered as independent Board Members. The following serves as the business address for the members of the Board of Directors in relation to their directorships in the Company: Siem Offshore Management AS Nodeviga 14 4610 Kristiansand Norway 9.1.2 Brief biographies of the members of the Board Directors
Eystein Eriksrud (born 1970), Chairman Mr. Eriksrud is the Deputy CEO of Siem Industries Inc., the Company’s main shareholder. He is further the chairman of Electromagnetic Geoservices ASA, Flensburger Schiffbaugesellschaft mbH & Co KG and a director of Subsea 7 S.A. Prior to joining Siem Industries in October 2011, he was partner of the Norwegian law firm Wiersholm Mellbye & Bech since 2005 working as a business lawyer with an internationally oriented practice in mergers and acquisitions, company law and securities law, particularly in the shipping, offshore and oil service sectors. He was Group Company Secretary of the Kvaerner Group from 2000-2002 and served as Group General Counsel of the Siem Industries Group from 2002-2005. He has served on the boards of Veripos Inc., Privatbanken ASA and Tinfos AS as well as a number of other boards. Eriksrud is a Norwegian citizen.
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Kristian Siem (born 1949), Board member Mr. Siem is chairman of Siem Industries Inc., Subsea 7 S.A. and Siem Industrikapital AB and a director of Siem Shipping Inc., Flensburger Schiffbau-Gesellschaft mbH & Co. KG, North Atlantic Smaller Companies Investment Trust plc. and NKT Holding A/S. Mr. Siem is a Norwegian citizen.
Michael Delouche (born 1957), Board member Mr. Delouche is the president and the secretary of Siem Industries Inc. and is in charge of the Company's operations at the registered office in George Town, Cayman Islands. He is a director of Siem Shipping Inc. and a former director of Subsea 7 Inc. Mr. Delouche received degrees in civil engineering (structural) and business and was previously an audit manager with KPMG Peat Marwick LLP. Mr. Delouche is a US citizen.
David Mullen (born 1958), Board member David Mullen is the founder and CEO of Shelf Drilling, an international shallow water drilling contractor. Since the company's inception in November 2012, David has lead Shelf Drilling through a series of complex transactions in establishing Shelf Drilling with a fleet of 37 Jack-ups and 1 swamp barge and 2 new build rigs under construction. Prior to Shelf Drilling, David was CEO of Wellsteam Holdings PLC, a UK-listed company that designs, manufactures and services subsea pipeline products. From 2008 – 2010, David served as CEO of Ocean Rig ASA, a Norway-listed ultra-deep water drilling contractor. Prior to 2008 David held executive management positions with Transocean and Schlumberger Limited, including a 23 year career with Schlumberger Limited.
Mr. Mullen holds a degree in geology from Trinity College, Dublin, and a master degree in geophysics from the University College Galway, Ireland. Mr. Mullen is an Irish citizen.
John C. Wallace (born 1938), Board member John C. Wallace is a Chartered Accountant having qualified with PricewaterhouseCoopers in Canada in 1963, after which he joined Baring Brothers & Co., Limited in London, England. Prior to his retirement in 2010, he served for over twenty-five years as Chairman of Fred. Olsen Ltd., a London-based corporation that he joined in 1968 and which specializes in the business of shipping, renewable energy and property development. He received his B. Comm degree majoring in Accounting and Economics from McGill University in 1959. In November 2004, he successfully completed the International Uniform Certified Public Accountant Qualification Examination and has received a CPA Certificate from the State of Illinois. Mr. Wallace also retired from the board of directors of Ganger Rolf ASA and Bonheur ASA, Oslo, both publicly-traded shipping companies with interests in offshore energy services and renewable energy. He is a Director of Callon Petroleum Co , USA where he is Chairman of the Audit Committee. He was inducted as a 2011 Industry Pioneer by the Offshore Energy Centre in Houston. Mr. Wallace is a Canadian citizen.
9.1.3 Remuneration
The remuneration paid to the members of the Board of Directors (acting in capacity as board members) in 2014 was USD 440,000.
9.1.4 Shares and options held by members of the Board of Directors
As at the date of this Prospectus, the Chairman Eystein Eriksrud holds 45 000 Shares in the Company through his wholly-owned company Laburnum AS. None of the other members of the Board of Directors holds any Shares or options for Shares in the Company.
The main shareholder of the Company, Siem Europe S.a r.l. is controlled by a trust where certain members of Kristian Siem’s family are potential beneficiaries.
9.2 Management
9.2.1 Overview
62
The senior management of the Company consists of four individuals. The names of the members of the Management as at the date of this Prospectus, and their respective positions, are presented in the table below: Name Position Served since Idar Hillersøy Chief Executive Officer August 2015 Dagfinn B. Lie Chief Financial Officer October 2007 Bernt Omdal Chartering Director July 2011 Tore B. Johannessen Organization and HR Director May 2012
The following serves as the business address for the members of Management in relation to their positions in the Company: Siem Offshore Management AS Nodeviga 14 4610 Kristiansand Norway 9.2.2 Brief biographies of the members of the Management
Set out below are brief biographies of the members of the Management, including their relevant management expertise and experience, an indication of any significant principal activities performed by them outside the Company and names of companies and partnerships of which a member of the Management is or has been a member of the administrative, management or supervisory bodies or partner the previous five years (not including directorships and management positions in subsidiaries of the Company). Idar Hillersøy (born 1963) – Chief Executive Officer Mr. Idar Hillersøy was appointed CEO of Siem Offshore with effect from 1 August 2015. Mr. Hillersøy joined the Company in April 2015 as CEO of Siem Offshore OSV. Idar Hillersøy is also the President and CEO of Secunda Canada (50% owned by Siem Offshore). He has OSV Management and Project Management experience from Simon Møkster Shipping AS (CCO), Seabrokers (General Manager), Norwegian Contractors and Stolt Offshore. Idar Hillersøy holds an engineering degree from Høgskolen i Sør Trøndelag (HiST) and an MBA from Heriot-Watt University. Idar Hillersøy is a Norwegian citizen and resident in Stavanger and Kristiansand, Norway. Dagfinn B. Lie (born 1972) – Chief Financial Officer Mr. Dagfinn B. Lie joined Siem Offshore in October 2007 as Controller and was appointed CFO with effect from 1 January 2009. Dagfinn B. Lie has a Master in Finance & Accounting and an MBA from the Norwegian School of Economics and Business Administration. Prior to his current employment in Siem Offshore he has gained experience from, among others, the companies Wallenius Wilhelmsen Logistics and ABB Offshore. Dagfinn B. Lie is a Norwegian citizen and resident in Vennesla, Norway. Bernt Omdal (born 1966) – Chartering Director Mr. Bernt Omdal was appointed as head of chartering 1 July 2011. Bernt Omdal has been the Chartering Director of the company since November 2008 and has more than 20 years of experience within the maritime industry, including chartering, operations and shipbroking. Bernt Omdal is a Norwegian citizen and resident in Kristiansand, Norway. Tore B. Johannessen (born 1955) – Organization and HR Director Mr. Tore B. Johannessen was appointed Global HR Director for Siem Offshore with effect of 15 May 2012. He has a long and diverse experience from the oil and gas industry. He came from the position as Senior Vice President HR & Organization in TTS Energy AS. He has also previous experience from position as Regional General Manager in DnB, Norway and Vice President HR & Organization in Hydralift AS. Tore B. Johannessen is a Norwegian citizen and resident in Kristiansand, Norway.
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9.2.3 Remuneration and benefits
The remuneration paid to the members of the Management in 2014 was TUSD 2,421.4. The table below sets out salaries and other benefits to the members of the Management in 2014 (all in USD 1,000). Name Salary paid Pension
premium Other
benefits Share
options Terje Sørensen* 610.6 33.8 55.9 3,600,000 Dagfinn B. Lie 310.5 31.1 12.5 2,400,000 Svein Erik Mykland* 452.4 40.6 9.0 2,400,000 Bernt Omdal 391.4 37.2 3.1 2,400,000 Tore B. Johannessen 388.6 41.0 3.7 2,400,000 *Terje Sørensen will leave the Company after a transition phase following the stock exchange notice on 31st of July 2015 where Idar Hillersøy was appointed new CEO of Siem Offshore Inc. Svein Erik Mykland will further step down as Chief Operating Officer and take over responsibility for the follow up and development of Siem Offshore Contractors. A new Chief Operating Officer will be employed. 9.2.4 Long-term incentive program
The Company has entered into two Share based option programs, the first in 2013 and the second in 2014. On the 13 January 2013, the Company entered into Share option agreement with selected employees. The Board of Directors awarded 14,000,000 share options to eight key employees of the Company. The exercise price is NOK 8.45 per share. The exercise price of the granted options is equal to the market price of the shares on the date of the grant. On the 2 April 2014, the Company entered into Share option agreement with selected employees. The Board of Directors awarded 3,000,000 share options to ten key employees of the Company. The exercise price is NOK 9.07 per share. The exercise price of the granted options is equal to the market price of the shares on the date of the grant. 9.2.5 Shares held by members of the Management
As of the date of this Prospectus, the members of the Management own Shares as follows: Name Shares owned Share options Dagfinn B. Lie 428,161 2,400,000 Bernt Omdal 0 2,400,000 Tore B. Johannessen 0 2,400,000 Idar Hillesøy 0 0 Other key employees 240,000 5,000,000
9.3 Directorships and management positions held by the Board Members and the senior management
The following table sets forth all companies and partnerships in which the members of the Board of Directors and senior management have been members of the administrative, management and supervisory bodies in the previous five years (not including subsidiaries within the Group).
64
Overview Board Members
Name of officer Positions Company or partnership
Kristian Siem Current:
Director
Chairman
Director
Director
Chairman
Deputy Chairman
Director
Director
Siem Offshore Inc.
Siem Industries Inc.
Frupor S.A
Siem Shipping Inc.
Subsea 7 S.A
NKT Holding A/S
North Atlantic Smaller Companies Investment Trust plc
Flensburger Schiffbau-Gesellschaft mbH & Co. KG
Eystein Eriksrud Current:
Chairman
Director
Chairman
Chairman
Chairman
Director
Director
Director
Director
Chairman
Director
Director
Director
Director
Director
Chairman
Director
Terminated:
Chairman
Siem Offshore Inc.
Subsea 7 S.A
Electromagnetic Geoservices ASA
Siem Kapital AS
Flensburger Schiffbau-Gesellschaft mbH & Co. KG
VSK Finance Ltd.
VSK Holdings Ltd
Ember VRM S.a r.l.
Siem Car Carriers AS
Laburnum AS
Siem Europe S.a r.l.
Siem Capital UK Ltd.
Epistates Ltd.
Siem WIS AS
SCC Shipowning II DA
SCC Shipowning I AS
Star Reefers AS
Veripos Inc.
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John Wallace Current:
Director
Director
Director
Director
Director
Terminated:
Director
Director
Director
Siem Offshore Inc.
Callon Petroleum Co.
LNG Direct Rail Ltd.
Secunda Holdings GP Inc.
Secunda Operations GP Inc.
Bonheur ASA
Ganger Rolf ASA
Fred. Olsen Ltd.
David Mullen Current:
Director
Chairman
Director
CEO & Director
Terminated:
CEO & Director
Director
Director
Director
CEO & Director
Director
Director
Director
Director
Siem Offshore Inc.
Shelf Drilling Midco Ltd.
Shelf Drilling Ltd. and its wholly owned subsidiary companies.
Shelf Drilling Holdings Ltd.
Ocean Rig AS
Ocean Rig Ltd
Ocean Rig UK Ltd
Tercel Oilfield Products Ltd.
Wellstream Holdings PLC
Wellstream International Ltd
Ocean Rig Ghana Ltd
Wellstream Finance Ltd
Wellstream (Trustee) Ltd
Michael Delouche
Current:
Director
Director
President
Manager A
Director
Director
Director
Director
Siem Offshore Inc.
Siem Shipping Inc.
Siem Industries Inc.
Siem Europe S.a r.l.
Deep Seas Insurance Ltd.
VSK Holdings Inc.
VSK Finance Inc.
Various Cayman Island subsidiaries of Subsea 7 S.A.
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Overview Senior Management
Name of officer Positions Company or partnership
Idar Hillersøy Current:
CEO
Director
Siem Offshore Inc.
EAH Holding AS
Dagfinn B. Lie Current:
CFO
Chairman
Siem Offshore Inc.
DG – Invest AS
Bernt Omdal Current:
Chartering Director
Director
Director
Siem Offshore Inc.
Chr.Th.Boe & Søn AS
Stiftelsen Sørlandets Seilende Skoleskibs Institution
Tore B. Johannessen
Current:
Organization & HR Director
Director
Director
Terminated:
Senior Vice President HR & Organization
Director
Siem Offshore Inc.
Sørlandet Shipping Association
Sørlandsreklame AS
TTS Energy, division of TTS Group ASA
Kristiansand Chamber of Commerce
9.4 Benefits upon termination
There are no specific benefits upon termination of engagement for board members or senior management.
9.5 Pension and retirement benefits
The Company has a defined benefit plan for its employees in Norway and its senior management. The pension scheme is financed through contributions to insurance companies or pension funds. A defined benefit plan defines the amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation.
9.6 Loans and guarantees
Loans on December 31, 2014 Amount Interest Comment Loans to senior management 3,331 - Share loan Total 3,331 - The loans are repayable by the employee when the employee's shares in the Company are realized or if the employee leaves the Company. The loans are secured by pledges in relevant shares.
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9.7 Audit committee
The following Directors are currently members of the Company’s audit committee: • John C. Wallace
• Michael Delouche
The agenda for each audit committee meeting is pre-planned to ensure that each aspect of the committee’s responsibilities is discharged as part of an annual cycle. The main responsibilities of the audit committee are to: • monitor the integrity and clarity of the financial information and of the major
financial statements of the Company, and to review any significant financial reporting issues and judgments those statements contain;
• approve the annual external audit plan and to review with the external auditors the nature, scope and results of their audit, and any control issues raised by them;
• make recommendations as to the appointment, terms of engagement and remuneration of the external auditors and review any question of their resignation or removal, and to review the effectiveness of the external auditors and their independence;
• review the consistency of and any changes to accounting policies, the application of appropriate accounting standards, and the methods used to account for significant or unusual transactions;
• review the Company’s internal controls and systems and practices for the identification and management of risk; and
• monitor compliance with the Company’s policies to prevent illegal and questionable corporate conduct and to review arrangements for ‘whistle-blowing’.
The external auditors attend meetings of the committee, other than when their appointment or performance is being reviewed, and the chief financial officer and members of the finance function attend as appropriate. It is the intention of the committee to meet with the auditors in the absence of management at least twice a year. The external auditors are appointed annually at the annual general meeting. The Board audit committee considers the reappointment of the auditors and reports its findings to the Board. The Board audit committee periodically considers the performance, cost and independence of the external auditors, including a comparison of audit fees with similar trading companies and reviews the level of service provided by the audit team throughout the Group.
9.8 Compensation Committee
The Compensation Committee consists of two Directors, Kristian Siem and Eystein Eriksrud. The mandate of the committee is to review and approve the compensation of the CEO and any bonuses to all executive personnel.
9.9 Conflicts of interests
The main shareholder of the Company, Siem Europe S.a r.l. is controlled by a trust where certain members of Kristian Siem’s family are potential beneficiaries. Kristian Siem, who is a member of the Board of the Company, is also inter alia the chairman of the board of directors of Siem Industries Inc. and of Subsea 7 S.A., the charterer of the OSCV "Siem Stingray". The contract between the Company and Subsea 7 S.A. is made on arms length terms.
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In September 2014 Siem Industries Inc., which is the beneficial owner of Siem Europe S.a r.l., announced the acquisition of Flensburger Schiffbau-Gesellschaft mbH & Co. KG which is building the two Well-Intervention Vessels under construction by the Company. The contract between Flensburger Schiffbau-Gesellschaft mbH & Co. KG and the Company is made on arm's length terms. In November 2014, the Company provided a loan of EUR 15 million to Siem Industries Inc. as part of the restructuring of Flensburger Schiffbau-Gesellschaft mbH & Co. KG. The loan was provided to ensure delivery of the two Well-Intervention Vessels under construction and shall be utilized to finance the yard. EUR 10 million of the funding of the loan was provided by Helix Energy Solutions Group Inc. by way of prepayment of charter hire for the two Well-Intervention Vessels. The loan is at market terms and matures when the last of the two Well-Intervention Vessels have been delivered from the yard. At the end of 2014 a short term loan of USD 60 million was drawn by the Company under a credit facility provided by Siem Industries Inc. The short term loan is on market terms. In June 2015, a short term loan of USD 15 million was provided by Siem Industries Inc. to the Company. The short term loan is on market terms. The Company has currently not drawn on the short term loan, and any undrawn portion of the USD 15 million commitment will be cancelled, and any drawn amounts will mature, when the proceeds from the Rights Offering has been received by the Company. Except from the above, there are no potential conflicts of interest between the Directors and members of managements’ duties to the Company and their private interests and other duties.
9.10 Convictions for fraudulent offences, bankruptcy etc.
None of the members of the Board of Directors or the Management have during the last five years preceding the date of this Prospectus:
• any convictions in relation to indictable offences or convictions in relation to fraudulent offences;
• received any official public incrimination and/or sanctions by any statutory or
regulatory authorities (including designated professional bodies) or been disqualified by a court from acting as a member of the administrative, management or supervisory bodies of a company or from acting in the management or conduct of the affairs of any company; or
• been declared bankrupt or been associated with any bankruptcy, receivership or liquidation in his/her capacity as a founder, director or senior manager of a company or partner of a limited partnership.
9.11 Employees
9.11.1 Overview
As at the date of this Prospectus, the Company had a total of 876 employees.
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The following table illustrates the number of employees as per the end of each calendar year for 2014 and 2013 and 2012 split by the geographical areas. Geographical area 2014 2013 2012 Norway 333 468 451 Germany 82 66 21 Holland 58 54 70 Brazil 552 514 525 Poland 9 4 0 Australia 1 1 0 Ghana n.a n.a 5 USA 3 3 4 India 0 0 2 Total 1,038 1,110 1,078
9.12 Corporate governance
The Company complies with the Corporate Governance Code. As a company incorporated in the Cayman Islands, Siem Offshore Inc. is an exempted company duly incorporated under the laws of the Cayman Islands and subject to Cayman Islands laws and regulations with respect to corporate governance. Cayman Islands corporate law is to a great extent based on English Law. In addition, due to the Company’s listing on the Oslo Stock Exchange, certain aspects of Norwegian Securities law apply to the Company and there is a requirement to adhere to the Corporate Governance Code. Due to new provisions implemented in the Norwegian Accounting Act, compliance with the regulations for corporate governance reporting is now a legal requirement provided that it does not conflict with the Cayman Islands laws and regulations. The Company endeavours to maintain high standards of corporate governance and is committed to ensuring that all shareholders of the Company are treated equally and the same information is communicated to all shareholders at the same time. Corporate governance is subject to annual assessment and review by the Board of Directors. Code of Conduct It is the policy of the Company to conduct its business in accordance with all applicable laws and regulations and in an ethically responsible manner. The Company’s code of conduct guidelines applies to all directors, officers, hired staff, temporary employees and employees of the Company. It enables the Company to continue to operate ethically, honestly and to comply with law.
The Company’s code of conduct guidelines sets out minimum required standards and it is a line management responsibility to communicate and implement the Company’s code of conduct guidelines and associated Siem Offshore policies. The Company has a policy of zero tolerance for corruption and other illegal business means, and will not accept that our people use improper influence on any individual or entity. Due to the international nature of our business, we are subject to several anti-corruption laws. Corruption is a threat to fair business, it undermines legitimate business activities, and any violation within our organisation will be a threat to our reputation and credibility in the market.
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10. CORPORATE INFORMATION
10.1 Incorporation and address
Siem Offshore Inc. is an exempted company limited by shares incorporated under the laws of Cayman Islands with corporate registration no. 140468. The Company was incorporated on 12 October 2004 under the name Siem Supply Inc. The Company’s commercial name is Siem Offshore. The Company and its activities are primarily governed by the Companies Law (2013 Revision) and the Company’s Memorandum and Articles of Association. Certain elements of Norwegian securities law regulations will apply in addition, since the Company’s shares are listed on the Oslo Stock Exchange. The registered address of Siem Offshore Inc. is as follows: Siem Offshore Inc. PO Box 309 Ugland House South Church Street George Town Grand Cayman KY1-1104 Cayman Islands The Company maintains executive offices in the Cayman Islands at the following address: Siem Offshore Inc. P.O.Box 10718 George Town Grand Cayman KY1-1006 Cayman Islands Telephone: + 1 345 949 1030 Telefax: + 1 345 946 3342 The Company’s headquarter and corporate management team is located at the following address: Siem Offshore Management AS Nodeviga 14 4610 Kristiansand Norway
10.2 Listing and registration
The Company's Shares are listed on the Oslo Stock Exchange and are trade under the ticker symbol "SIOFF". The Shares are registered in the Norwegian Central Securities Depository (VPS). The Company's registrar is Nordea Bank Norge ASA, Oslo, Norway, Middelthunsgate 17, 0368 Oslo, Norway. The Shares carry the ISIN number KYG813131011.
10.3 Share capital and Share capital history
The authorized share capital of the Company is USD 5,500,000 divided into 550,000,000 shares of a nominal value of USD 0.01 each.
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The issued share capital of the Company as of the date of this Prospectus is USD 3,875,913.80 divided into 387,591,380 Shares each with a nominal value of USD 0.01. All the Shares are validly issued and fully paid.
On 16 July 2015, the Company called for an extraordinary general meeting to be held on 14 August 2015 in order to increase the Company's authorised share capital from USD 5,500,000 to USD 10,000,000 by the creation of an additional 450,000,000 Shares. The increase in share capital is meant to facilitate the Rights Offering. Following the Rights Offering, the issued share capital will be USD 8,420,213,80 divided into 842,021,380 Shares. There has not been any development in the Company's issued share capital for the periods covered by the historical financial information included in the Prospectus as Appendix B.
10.4 Own shares
As of the date of this Prospectus, the Company does not own any Shares.
10.5 Shareholder agreements
The Company is not aware of any shareholders' agreements in relation to the Shares.
10.6 Outstanding authorizations
The Board of Siem Offshore currently holds authorization to issue 612,408,620 new Shares in the Company. Following the Rights Offering, the Board will be authorised to issue 157,978,620 new Shares in the Company.
10.7 Convertible instruments, warrants and share options
On the 13 January 2013, the Company entered into a Share option agreement with selected employees. The Board of Directors of Siem Offshore Inc. has authorized the award of 14,000,000 share options to eight key employees of the Company. The exercise price is NOK 8.45 per share. The exercise price of the granted options is equal to the market price of the shares on the date of the grant. The Options can be exercised as follows: 2014: 20% of the total number beginning on January 18th 2014. 2015: 40% of the total number beginning on January 18th 2015, less any options previously issued. 2016: 60% of the total number beginning on January 18th 2016, less any options previously issued. 2017: 80% of the total number beginning on January 18th 2017, less any options previously issued. 2018: 100% of the total number beginning on June 18th 2018, less any options previously issued.
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The exercise period shall in no event be later than the date falling 10 years after the award date. The group has no legal or constructive obligation to repurchase or settle the options in cash. No options were exercised during 2013 or 2014. On 2 April 2014, the Company entered into a second Share option agreement with selected employees. The Board of Directors has authorized the award of 3,000,000 share options to ten key employees of the Company. The exercise price is NOK 9.07 per share. The exercise price of the granted options is equal to the market price of the shares on the date of the grant.
The Options can be exercised as follows:
2017:
60% of the total number beginning on 2 April 2017, less any options previously issued.
2018:
80% of the total number beginning on 2 April 2018, less any options previously issued.
2019:
100% of the total number beginning on 2 April 2019, less any options previously issued.
The exercise period shall in no event be later than the date falling 10 years after the award date.
Except as set out above, neither the Company nor any of its subsidiaries has issued any options, warrants, convertible loans or other instruments that would entitle a holder of any such instrument to subscribe for any shares in the Company or its subsidiaries. Further, neither the Company nor any of its subsidiaries has issued subordinated debt or transferable securities other than the Shares and the shares in its subsidiaries which will be held, directly or indirectly, by the Company.
10.8 Dividend policy
The priorities for the use of Company funds are determined by the Board of Directors and recommendations of Management influenced by existing conditions. At present, priorities for use of funds in order of importance are repayment of debt, investment opportunities in the business, and the return of capital to the shareholders in form of share buy-back or dividends. The Company paid out NOK 0.10 per Share (approximately NOK 38.8 million in total) in respect of 2013.
10.9 Shareholders
The table below sets out the top 20 shareholders registered in the VPS as of 11 August 2015:
Number of shares
Share % Name of Shareholder Account Nationality
133 279 421 34.39 SIEM EUROPE S.A R.L LUX 76 780 808 19.81 Ace Crown Internatio C/O SINGA STAR PTE L VGB 35 211 458 9.08 EUROCLEAR BANK S.A./25% CLIENTS NOM BEL 8 510 767 2.20 WATERMAN HOLDING LTD GBR 8 036 317 2.07 SKAGEN VEKST NOR
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Number of shares
Share % Name of Shareholder Account Nationality
7 959 178 2.05 FONDSFINANS NORGE NOR 5 415 687 1.40 MP PENSJON PK NOR 5 313 000 1.37 OJADA AS NOR 3 951 600 1.02 NORDEA BANK FINLAND EGENHANDELSKONTO
PROPRIETARY SECURITI FIN
3 727 644 0.96 Merrill Lynch,Pierce S/A MLPF & S HOLD NOM USA 3 366 602 0.87 FONDSAVANSE AS NOR 3 253 700 0.84 EGD CAPITAL AS NOR 3 142 574 0.81 PUMPØS A/S NOR 3 123 151 0.81 Alta Invest SA PAN 2 850 000 0.74 BERGEN KOMMUNALE PEN NOR 2 550 000 0.66 ROVDEFRAKT AS NOR 2 422 023 0.62 KLP AKSJE NORGE VPF NOR 2 376 000 0.61 DnB NOR MARKETS, AKS DNB Bank ASA NOR 2 269 897 0.59 MUST INVEST AS NOR 2 082 966 0.54 FR FALCK FRÅS AS NOR
Siem Europe S.a r.l. currently owns 133,279,421 shares in the Company, equal to 34.4% of the issued Shares. Siem Europe S.a r.l. is the main shareholder of Siem Offshore Inc. and is controlled by a trust whose potential beneficiaries include members of Kristian Siem’s immediate family. Kristian Siem is a Board Member of the Company.
Siem Europe S.a r.l. has underwritten the Rights Offering as further described in Section 13.20, "The Rights Offering—The Underwriting". If as a result of the underwriting, Siem Europe’s ownership interest is increased above its current ownership interest and such new ownership interest is not reduced by the sale of Shares down to or below the level of the current ownership interest within four weeks, then Siem Europe S.a r.l. will be required to make a mandatory offer for all Shares in accordance with existing regulations described in Section 11.8 "Securities trading in Norway—Mandatory offer requirements".
The Company is not aware of any other agreements that at a later stage may lead to change of control of the Company.
In addition to Siem Europe S.a r.l., Ace Crown International and Euroclear Bank S.A., as nominee, holds more than 5% of the issued Shares in the Company with ownership interests of 19.81% and 9.08% respectively.
Shareholders with ownership exceeding 5% must comply with disclosure obligations according to the Norwegian Securities Trading Act section 4-3. For more detailed description please see section 11.7 "Securities trading in Norway—Disclosure obligations".
10.10 The Articles of Association and certain aspects of Cayman Islands law
The Company is an exempted company incorporated with limited liability in the Cayman Islands. This means that the Company may not trade in the Cayman Islands with any person, firm or corporation, except in furtherance of the business of the Company carried on outside of the Cayman Islands.
The Company and its activities are primarily governed by the Companies Law (2013 Revision), the Company's memorandum of association and the Articles of Association. As the Company is listed on the Oslo Stock Exchange, certain aspects of its activities are governed by Norwegian law.
The constitutional documents of the Company consist of the Company's memorandum of association and the Articles of Association. The Articles of Association are significantly more extensive than the articles of association of a Norwegian company. The Articles of
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Association deal primarily with the Company's administration, internal regulation and the distribution of rights and authorities between the shareholders and the directors.
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Company objective Pursuant to section 3 of the Company's memorandum of association, the objective of the Company is unrestricted and the Company shall have full power to carry out any objective not prohibited by law. General Meeting Under Cayman Islands law, there is no requirement to hold an annual general meeting. However, pursuant to the Articles of Association, the Company shall hold annual General Meetings each year. Any annual General Meeting shall be held at the time and place as decided by the board of directors. All General Meetings other than annual General Meetings shall be called extraordinary General Meetings. The annual General Meeting shall be called by the board of directors. Additionally, the Board of Directors shall, on the requisition of a shareholder or shareholders’ holding in aggregate no less than 10% of the issued Shares which as at that date carry the right to vote at the General Meeting, forthwith proceed to convene an extraordinary General Meeting. A General Meeting shall be called by not less than 14 clear days notice in writing, except when consent to a shorter period is given in accordance with the provisions set out in the Articles of Association. The notice shall specify the time, place, and agenda of the meeting, particulars of the resolutions to be considered at the meeting and the general nature of that business to be conducted at the General Meeting. The notice convening a General Meeting to pass a special resolution shall specify the intention to propose the resolution as a special resolution. For all purposes a quorum for a General Meeting is constituted by one or more members present in person holding not less than one third of the issued shares of the Company. A resolution of a General Meeting is adopted by ordinary resolution unless the Companies Law (2013 Revision) or the Articles of Association specify otherwise. "Ordinary resolution" means a resolution passed by a simple majority of the shareholders as, being entitled to do so, vote in person or by proxy, at a General Meeting, and includes a unanimous written resolution. In computing the majority when a poll is demanded regard shall be had to the number of votes to which each member is entitled by the Articles of Association. "Special Resolution" means a resolution passed by a majority of at least two thirds of the shareholders as, being entitled to do so, vote in person or by proxy, at a General Meeting. Each of the Shares represents one vote on a poll in a General Meeting. Shareholders may be represented in person or by proxy. In the case of an equality of votes the chairman of the meeting shall be entitled to a second or casting vote. Amendments of the Articles of Association Subject to the provisions of the Companies Law (2013 Revision) and the provisions of the Articles of Association as regards the matters to be dealt with by ordinary resolution, the Articles of Association may be amended by the passing of a special resolution.
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Equity and share capital increases The Companies Law, the Company's memorandum of association and the Articles of Association draws a distinction between authorised and issued share capital. The Company’ authorised share capital dictates the maximum number of shares which the Company is authorised to issue and such information is set out in the Articles of Association. The authorised share capital of the Company may be increased by the passing of an ordinary resolution at the General Meeting. The Board of Directors may allot, issue, grant options over or otherwise dispose of shares to such persons, at such times and on such other terms as they think proper (subject to the Companies Law (2013 Revision) and the Articles of Association) without any further consent or approval by the shareholders. Shareholders in the Company do not have pre-emptive rights in later capital increases. Capital reductions A reduction of the share capital is subject to the passing of a special resolution at the General Meeting. The same majority is required for a reduction of the Company’s capital redemption reserve fund. Classes of shares The Shares are currently not divided into different classes. However, the Articles of Association establish a right to divide the share capital into different classes of shares with varied rights attaching to the shares of such different classes. According to the Articles of Association, modifications in the rights attached to the Shares, such as dividing the shares into different classes of shares with different rights attached, require the written consent of at least 2/3 of the holders of the issued shares of that class or the passing of a resolution passed by a majority of not less than two thirds of the votes cast at a separate meeting of the holders of the shares of the applicable class. Purchase of shares Subject to the Companies Law (2013 Revision), to relevant regulations of any securities exchange or other system on which the shares of the Company may be listed or otherwise authorised for trading (an, "Exchange"), and to any rights conferred on the holders of any class of shares, the Company has the power:
(i) to purchase or otherwise acquire any of its own shares, provided either:
(a) the manner of purchase has first been authorised by the Company in general meeting;
(b) such purchases are made in open market transactions on an Exchange;
(c) such purchases may be effected from time to time, as authorised by the Company in general meeting, at a price per share no higher than the average of the closing prices of said shares on an Exchange, for the five days on which said shares are traded immediately preceding any such purchase (the “Average Market Price”);
(d) such purchases may be effected from time to time, as authorised
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by the Company in general meeting at a price per share in excess of the Average Market Price, provided that: the shares to be purchased shall be in blocks consisting of a number equal to or greater than five per cent. of the number of shares then outstanding and the price to be paid therefore shall have been found to be fair in a written opinion of independent investment bankers who have been selected for the purpose by a disinterested committee of Directors; or
(e) an offer is made to all shareholders of the Company to purchase a specified number of shares at a specified price, all tenders of shares made in response to such offer to be accepted pro rata in the event that more shares are to be tendered than the Company has offered to purchase, except that all tenders of 99 shares or less may be accepted in full at the discretion of the Directors,
provided that, the Company shall not, in any 12 month period, purchase in aggregate more than such number of shares as shall be equal to 10 per cent. of the lowest number of shares in issue during such period except to the extent authorised by special resolution;
(ii) to purchase or otherwise acquire warrants for the subscription or purchase of its own shares; and
(iii) to give, directly or indirectly, by means of a loan, a guarantee, a gift, an indemnity, the provision of security or otherwise howsoever, financial assistance for the purpose of or in connection with a purchase or other acquisition made or to be made by any person of any shares or warrants in the Company. The Company may pay for such shares or warrants in any manner authorised or not prohibited by law, including out of capital. Should the Company purchase or otherwise acquire its own shares or warrants, neither the Company nor the Board shall be required to select the shares or warrants to be purchased or otherwise acquired rateably or in any other manner as between the holders of shares or warrants of the same class or as between them and the holders of shares or warrants of any other class or in accordance with the rights as to dividends or capital conferred by any class of shares.
Transfer of shares The Shares are generally freely transferable and there are no restrictions on trading in the Shares. The Shares are registered in the VPS, and are tradable in the same manner as other VPS registered shares. The Board of Directors may, however, in its absolute discretion, refuse to register a transfer of any shares which are not fully paid up or on which the Company has a lien. In accordance with the Articles of Association, the board of directors shall decline to register the transfer of any share to a person where the board of directors is of the opinion that such transfer might breach any law or requirement of any authority or any approved stock exchange until it has received such evidence as it may require satisfying itself that no such breach would occur. Dividends Subject to the Companies Law (2013 Revision) and the Articles of Association, the Board of Directors may declare dividends and distributions on the Company’s issued Shares and authorise payment of the same out of the funds which are lawfully available. Dividends or
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distributions are payable only out of the profits, realised or unrealised, or out of the share premium account or as otherwise permitted by law. Each of the Shares carries equal rights to dividend and equal rights to any surplus in the event of liquidation. The Shares will be eligible for any dividends being declared and paid immediately upon the share issue. A Share will be deemed to be issued at the time that the Company's register of shareholders is updated to reflect such issue and the details of the applicable shareholder. The Articles of Association provide that the Company may deduct from any dividend or distribution payable to any shareholder all sums of money (if any) presently payable by him to the Company on account of calls or otherwise. The Companies Law (2013 Revision) and the Articles of Association do not provide for any time limit after which entitlement to dividends lapses. Subject to various exceptions, Cayman Islands law provides a limitation period of three years from the date on which an obligation is due. Any future payments of dividends on the Shares will be denominated in NOK, and will be paid to the shareholders through the VPS. Board of directors According to the Articles of Association, the Board of Directors shall consist of not less than three or more than seven persons (exclusive of alternate directors). The Company may, by ordinary resolution, increase or reduce the limits in the number of directors and may appoint and remove any director from the Board of Directors. A resolution in writing (in one or more counterparts) signed by each and every one of the Directors or all the members of a committee of the Directors shall be as valid and effectual as if it had been passed at a meeting of the Directors, or committee of Directors as the case may be, duly convened and held. The powers of the Board of Directors Subject to limitations in the Companies Law (2013 Revision), the Articles of Association and any direction given by special resolution by the General Meeting, the business of the Company shall be managed by the board of directors who may exercise all the powers of the Company. A duly convened meeting of the Board of Directors at which a quorum is presented may exercise all powers exercisable by the Board of Directors. The Board of Directors has full power to charge any of the Company’ assets and to borrow money without any sanction by the members at a General Meeting. The Board of Directors may, by power of attorney or otherwise, appoint a company, firm, person or body of persons to be the attorney or authorised signatory of the Company for such purposes and with such powers, authorities and discretions as the Board of Directors thinks fit, provided however that this does not exceed the powers vested in the Board of Directors by the Articles of Association. The Board of Directors may also authorise any attorney or authorised signatory to sub-delegate any or all powers, authorities and discretions vested in him. Furthermore, the Board of Directors may delegate any of its powers, authorities and discretions, including the power to sub-delegate, to any committees consisting of one or more directors. Every committee so formed shall conform to any regulations that may from time to time be imposed upon it by the Board of Directors.
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Directors’ interests A Director may be engaged by the Company for the purpose of performing services which go beyond his ordinary duties as a director, but he may not be the auditor of the Company. The director performing such services for the Company is entitled to such extra remuneration as the board of directors may decide. A Director or a company owned by him may also enter into commercial agreements with the Company provided that the relevant Director declares his interest in such contract at the board meeting where the contract is first considered. Subject to the provisions of the Articles of Association, a Director (or his alternate director in his absence) shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of the interest of any director or alternate director in any such contract or transaction shall be disclosed by him at or prior to its consideration and any vote thereon. Members of the administrative, management and supervisory bodies The management of the business of the Company is vested in the Board of Directors, whom may establish any committees or any person to be manager or agent for the Company’ affairs. Furthermore, the Board of Directors may appoint a secretary for such term, at such remuneration and upon such conditions as it may think fit, and any secretary so appointed may be removed by the Board of Directors. Annual accounts According to the Articles of Association, the financial year shall end on 31 December and begin on 1 January in each year, unless otherwise prescribed by the Board of Directors. The auditor shall audit the profit and loss account and the balance sheet of the Company and shall prepare a report which shall be laid before the shareholders at the annual General Meeting each year. The auditor’s report shall be open for inspection by any shareholder. Winding up According to the Articles of Association, in case of a liquidation of the Company the following shall apply; (i) if the assets available for distribution amongst the members shall be insufficient to repay whole of the Company’ issued share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the members in proportion to the par value of the shares held by them, and (ii) if the assets available for distribution amongst the members shall be more than sufficient to repay the whole of the Company’ issued share capital at the commencement of the liquidation, the surplus shall be distributed amongst the members in portion to the par value of the shares held by them subject to a deduction from those shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise.
10.11 Compulsory acquisition
Schemes of Arrangement The Companies Law (2013 Revision) of the Cayman Islands allow for schemes of arrangement. A scheme of arrangement is a flexible form of corporate restructuring and involves a range of transactions aimed to reorganise Cayman Islands companies. The schemes may be effected by a court-supervised scheme if an amalgamation or reconstruction is required or schemes of arrangement can be put in place either between a company and its shareholders in various forms, including takeovers, spin-offs, amalgamations, mergers, de-mergers, re-domicilings, restating net asset values, de-mutualisations, and/or between a company and its creditors, also in various forms such as debt-for-debt, debt-for-equity and debt-for-assets swaps, and the re-organisations of
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options and warrants. A scheme is a collective procedure. It operates both as a contract and a court order and has statutory effect. Provided the necessary majorities are obtained, the terms of a scheme become binding on all members of shareholders/creditors of the company, whether or not they (i) received notice of the scheme; (ii) voted at the meeting; (iii) voted for or against the scheme; and (iv) changed their minds afterwards. The range of possible objections that can be raised is very narrow. Dissenting shareholders have no statutory rights in any scheme, however, if such rights are thought desirable then the terms of the scheme itself may make such provision. The required majority is a super-majority of each class of members voting at the meeting (present in person or by proxy) being: 50% + one in number (i.e. a headcount vote); and 75% in value (i.e. the number of shares voted). Power to acquire shares In accordance with the Companies Law (2013 Revision), where a scheme or contract involving the transfer of shares or any class of shares in a company (in this section referred to as "the transferor company") to another company, whether a company within the meaning of the Companies Law (2013 Revision) or not (in this section referred to as "the transferee company") has, within four months after the making of the offer in that behalf by the transferee company, been approved by the holders of not less than 90% in value of the shares affected, the transferee company may, at any time within two months after the expiration of the said four months, give notice in the prescribed manner to any dissenting shareholder that it desires to acquire his shares, and where such notice is given the transferee company shall, unless on an application made by the dissenting shareholder within one month from the date on which the notice was given, the court thinks fit to order otherwise, be entitled and bound to acquire those shares on the terms on which under the scheme or contract the shares of the approving shareholders are to be transferred to the transferee company. Where a notice has been given by the transferee company and the Grand Court of the Cayman Islands has not, on an application made by the dissenting shareholder, ordered to the contrary, the transferee company shall, on the expiration of one month from the date on which the notice has been given or, if an application to the Grand Court of the Cayman Islands by the dissenting shareholder is then pending, after that application has been disposed of, transmit a copy of the notice to the transferor company and pay or transfer to the transferor company the amount or other consideration representing the price payable by the transferee company for the shares which that company is entitled to acquire, and the transferor company shall thereupon register the transferee company as the holder of those shares.
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11. SECURITIES TRADING IN NORWAY
This Section 11 includes certain aspects of rules pertaining to securities trading in Norway in a Norwegian incorporated company pursuant to Norwegian legislation, but is however not a full or complete description of the matters described herein. The following summary does not purport to be a comprehensive description of all the legal considerations that may be relevant to a decision to purchase, own or dispose of Shares. Investors are advised to consult their own legal advisors concerning the overall legal consequences of their ownership of Shares.
11.1 Introduction
Oslo Børs was established in 1819 and is the principal market in which shares, bonds and other financial instruments are traded in Norway. Oslo Børs is operated by Oslo Børs ASA, which also operates the regulated marketplace Oslo Axess. Oslo Børs has entered into a strategic cooperation with the London Stock Exchange group with regards to, inter alia, trading systems for equities, fixed income and derivatives.
11.2 Trading and settlement
Trading of equities on Oslo Børs is carried out in the electronic trading system Millenium Exchange. This trading system was developed by the London Stock Exchange and is in use by all markets operated by the London Stock Exchange as well as by the Borsa Italiana and the Johannesburg Stock Exchange. Official trading on Oslo Børs takes place between 09:00 hours (CET) and 16:20 hours (CET) each trading day, with pre-trade period between 08:15 hours (CET) and 09:00 hours (CET), closing auction from 16:20 hours (CET) to 16:25 hours (CET) and a post-trade period from 16:25 hours (CET) to 17:30 hours (CET). Reporting of after exchange trades can be done until 17:30 hours (CET). The settlement period for trading on Oslo Børs is two trading days (T+2). This means that securities will be settled on the investor’s account in the VPS two days after the transaction, and that the seller will receive payment after two days. Oslo Clearing ASA, a wholly-owned subsidiary SIX x-clear Ltd, a company in the Six Group, has a license from the Norwegian FSA to act as a central clearing service, and has from 18 June 2010 offered clearing and counterparty services for equity trading on Oslo Børs. Investment services in Norway may only be provided by Norwegian investment firms holding a license under the Norwegian Securities Trading Act, branches of investment firms from an EEA member state or investment firms from outside the EEA that have been licensed to operate in Norway. Investment firms in an EEA member state may also provide cross-border investment services into Norway. It is possible for investment firms to undertake market-making activities in shares listed in Norway if they have a license to this effect under the Norwegian Securities Trading Act, or in the case of investment firms in an EEA member state, a license to carry out market-making activities in their home jurisdiction. Such market-making activities will be governed by the regulations of the Norwegian Securities Trading Act relating to brokers' trading for their own account. However, market-making activities do not as such require notification to the Norwegian FSA or Oslo Børs except for the general obligation of investment firms being members of Oslo Børs to report all trades in stock exchange listed securities.
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11.3 Information, control and surveillance
Under Norwegian law, Oslo Børs is required to perform a number of surveillance and control functions. The Surveillance and Corporate Control unit of Oslo Børs monitors market activity on a continuous basis. Market surveillance systems are largely automated, promptly warning department personnel of abnormal market developments. The Norwegian FSA controls the issuance of securities in both the equity and bond markets in Norway and evaluates whether the issuance documentation contains the required information and whether it would otherwise be unlawful to carry out the issuance. Under Norwegian law, a company that is listed on a Norwegian regulated market, or has applied for listing on such market, must promptly release any inside information directly concerning the company (i.e. precise information about financial instruments, the issuer thereof or other matters which are likely to have a significant effect on the price of the relevant financial instruments or related financial instruments, and which are not publicly available or commonly known in the market). A company may, however, delay the release of such information in order not to prejudice its legitimate interests, provided that it is able to ensure the confidentiality of the information and that the delayed release would not be likely to mislead the public. Oslo Børs may levy fines on companies violating these requirements.
11.4 The VPS and transfer of Shares
The Company's shareholder register is operated through the VPS. The VPS is the Norwegian paperless centralised securities register. It is a computerised bookkeeping system in which the ownership of, and all transactions relating to, Norwegian listed shares must be recorded. All transactions relating to securities registered with the VPS are made through computerised book entries. No physical share certificates are, or may be, issued. The VPS confirms each entry by sending a transcript to the registered shareholder irrespective of any beneficial ownership. To give effect to such entries, the individual shareholder must establish a share account with a Norwegian account agent. Norwegian banks, authorised securities brokers in Norway and Norwegian branches of credit institutions established within the EEA are allowed to act as account agents. The entry of a transaction in the VPS is generally prima facie evidence in determining the legal rights of parties as against the issuing company or any third party claiming an interest in the given security. The VPS is liable for any loss suffered as a result of faulty registration or an amendment to, or deletion of, rights in respect of registered securities unless the error is caused by matters outside the VPS’ control which the VPS could not reasonably be expected to avoid or overcome the consequences of. Damages payable by the VPS may, however, be reduced in the event of contributory negligence by the aggrieved party. The VPS must provide information to the Norwegian FSA on an on-going basis, as well as any information that the Norwegian FSA requests. Further, Norwegian tax authorities may require certain information from the VPS regarding any individual’s holdings of securities, including information about dividends and interest payments.
11.5 Foreign investment in shares listed in Norway
Foreign investors may trade shares listed on Oslo Børs through any broker that is a member of Oslo Børs, whether Norwegian or foreign.
11.6 Disclosure obligations
If a person's, entity's or consolidated group's proportion of the total issued shares and/or rights to shares in an issuer with its shares listed on a regulated market in Norway (with Norway as its home state, which will be the case for the Company) reaches, exceeds or
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falls below the respective thresholds of 5%, 10%, 15%, 20%, 25%, 1/3, 50%, 2/3 or 90% of the share capital or the voting rights of that issuer, the person, entity or group in question has an obligation under the Norwegian Securities Trading Act to notify Oslo Børs and the issuer immediately. The same applies if the disclosure thresholds are passed due to other circumstances, such as a change in the Company's share capital.
11.7 Insider trading
According to Norwegian law, subscription for, purchase, sale or exchange of financial instruments that are listed, or subject to the application for listing, on a Norwegian regulated market, or incitement to such dispositions, must not be undertaken by anyone who has inside information, as defined in section 3-2 of the Norwegian Securities Trading Act. The same applies to the entry into, purchase, sale or exchange of options or futures/forward contracts or equivalent rights whose value is connected to such financial instruments or incitement to such dispositions.
11.8 Mandatory offer requirement
The Norwegian Securities Trading Act requires any person, entity or consolidated group that becomes the owner of shares representing more than one-third of the voting rights of a Norwegian issuer with its shares listed on a Norwegian regulated market to, within four weeks, make an unconditional general offer for the purchase of the remaining shares in that issuer. A mandatory offer obligation may also be triggered where a party acquires the right to become the owner of shares that, together with the party's own shareholding, represent more than one-third of the voting rights in the issuer and Oslo Børs decides that this is regarded as an effective acquisition of the shares in question. The mandatory offer obligation ceases to apply if the person, entity or consolidated group sells the portion of the shares that exceeds the relevant threshold within four weeks of the date on which the mandatory offer obligation was triggered. When a mandatory offer obligation is triggered, the person subject to the obligation is required to immediately notify Oslo Børs and the issuer in question accordingly. The notification is required to state whether an offer will be made to acquire the remaining shares in the issuer or whether a sale will take place. As a rule, a notification to the effect that an offer will be made cannot be retracted. The offer is subject to approval by Oslo Børs before the offer is submitted to the shareholders or made public. The offer price per share must be at least as high as the highest price paid or agreed to be paid by the offeror for the shares in the six-month period prior to the date the threshold was exceeded. If the acquirer acquires or agrees to acquire additional shares at a higher price prior to the expiration of the mandatory offer period, the acquirer is required to restate its offer at such higher price. A mandatory offer must be in cash or contain a cash alternative at least equivalent to any other consideration offered. In case of failure to make a mandatory offer or to sell the portion of the shares that exceeds the relevant mandatory offer threshold within four weeks, Oslo Børs may force the acquirer to sell the shares exceeding the threshold by public auction. Moreover, a shareholder who fails to make an offer may not, as long as the mandatory offer obligation remains in unfulfilled, exercise rights in the issuer, such as voting on shares at general meetings of the issuer's shareholders, without the consent of a majority of the remaining shareholders. The shareholder may, however, exercise its rights to dividends and pre-emption rights in the event of a share capital increase. If the shareholder neglects his duty to make a mandatory offer, Oslo Børs may impose a cumulative daily fine that accrues until the circumstance has been rectified. Any person, entity or consolidated group that owns shares representing more than one-third of the votes in a Norwegian issuer with its shares listed on a Norwegian regulated
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market is required to make an offer to purchase the remaining shares of the issuer (repeated offer obligation) if the person, entity or consolidated group through acquisition becomes the owner of shares representing 40% or more of the votes in the issuer. The same applies correspondingly if the person, entity or consolidated group through acquisition becomes the owner of shares representing 50% or more of the votes in the issuer. The mandatory offer obligation ceases to apply if the person, entity or consolidated group sells the portion of the shares which exceeds the relevant threshold within four weeks of the date on which the mandatory offer obligation was triggered. Any person, entity or consolidated group that has passed any of the above mentioned thresholds in such a way as not to trigger the mandatory bid obligation, and has therefore not previously made an offer for the remaining shares in the company in accordance with the mandatory offer rules is, as a main rule, required to make a mandatory offer in the event of a subsequent acquisition of shares in the company.
11.9 Foreign exchange controls
There are currently no foreign exchange control restrictions in Norway that would potentially restrict the payment of dividends to a shareholder outside Norway, and there are currently no restrictions that would affect the right of shareholders of a Norwegian issuer who are not residents in Norway to dispose of their shares and receive the proceeds from a disposal outside Norway. There is no maximum transferable amount either to or from Norway, although transferring banks are required to submit reports on foreign currency exchange transactions into and out of Norway into a central data register maintained by the Norwegian customs and excise authorities. The Norwegian police, tax authorities, customs and excise authorities, the National Insurance Administration and the Norwegian FSA have electronic access to the data in this register.
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12. TAXATION
The following is a summary of certain Norwegian tax considerations relevant to the acquisition, ownership and disposition of shares by holders that are residents of Norway for purposes of Norwegian taxation ("Resident Shareholders") and holders that are not residents of Norway for such purposes ("Non-resident Shareholders"). The summary is based on applicable Norwegian laws, rules and regulations as they exist as at the date of this Prospectus. Such laws, rules and regulations may be subject to changes after this date, possibly on a retroactive basis for the same tax year. The summary is of a general nature and does not purport to be a comprehensive description of all the tax considerations that may be relevant to the Shareholders and does not address foreign tax laws. Please note that special rules apply for shareholders that cease to be tax resident in Norway or that for some reason are no longer considered taxable to Norway in relation to their shareholding. Each Shareholder should consult with and rely upon their own tax advisor to determine the particular tax consequences for him or her and the applicability and effect of any Norwegian or foreign tax laws and possible changes in such laws. For the purpose of the summary below, a reference to a Norwegian or foreign shareholder or company refers to tax residency rather than nationality.
12.1 Taxation of dividends
12.1.1 Resident corporate Shareholders
Norwegian corporate shareholders (i.e. limited liability companies, mutual funds, savings banks, mutual insurance companies or similar entities resident in Norway for tax purposes) are generally exempt from tax on dividends received on shares in Norwegian limited liability companies, pursuant to the participation exemption (Norwegian: Fritaksmetoden). However, 3% of dividend income is generally deemed taxable as general income at a flat rate of 27%, implying that dividends distributed from the Company to resident corporate Shareholders are effectively taxed at a rate of 0.81%. 12.1.2 Resident personal Shareholders
Personal shareholders tax resident in Norway are in general tax liable to Norway for their worldwide income. Dividends distributed to personal Shareholders who are individuals resident in Norway for tax purposes, are taxed as ordinary income at a flat rate of 27% to the extent the dividends exceed a statutory tax-free allowance (Norwegian: Skjermingsfradrag). The allowance is calculated on a share-by-share basis, and the allowance for each share is equal the cost price of the share multiplied by a determined risk-free interest rate based on the effective rate after tax of interest on treasury bills (Norwegian: "Statskasseveksler") with three months maturity. The allowance is allocated to the Shareholder owning the share on 31 December in the relevant income year. Norwegian personal shareholders who transfer shares during an income year will thus not be entitled to deduct any calculated allowance related to the year of transfer. The Directorate of Taxes announces the risk free-interest rate in January the year after the income. The risk-free interest rate for 2014, was 0.9%. Any part of the calculated allowance one year exceeding dividend distributed on the same share ("excess allowance") can be carried forward and set off against future dividends received on, or capital gains upon realization of the same share. Furthermore, excess allowance can be added to the cost price of the share and included in basis for calculating
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the allowance on the same share the following year. 12.1.3 Non-resident Shareholders
Dividends distributed to Shareholders not resident in Norway for tax purposes are in general subject to withholding tax at a rate of 25%, unless otherwise provided for in an applicable tax treaty or the recipient is covered by the specific regulations for corporate shareholders tax-resident within the EEA (ref. the section below for more information on the EEA exemption). The company distributing the dividend is responsible for the withholding. Norway has entered into tax treaties with approximate 80 countries. In most tax treaties the withholding tax rate is reduced to 15%. In accordance with the present administrative system in Norway, the Norwegian distributing company will normally withhold tax at the regular rate or reduced rate according to an applicable tax treaty, based on the information registered with the VPS with regard to the tax residence of the Non-resident Shareholder. Dividends paid to Non-resident Shareholders in respect of nominee- registered shares will be subject to withholding tax at the general rate of 25% unless the nominee, by agreeing to provide certain information regarding beneficial owners, has obtained approval for a reduced or zero rate from the Central Office for Foreign Tax Affairs ("COFTA") (Norwegian: Sentralskattekontoret for utenlandssaker). Non-resident Shareholders who are exempt from withholding tax and Shareholders who have been subject to a higher withholding tax than applicable in the relevant tax treaty, may apply to the Norwegian tax authorities for a refund of the excess withholding tax. The application is to be filed with COFTA. If a Foreign Shareholder is engaged in business activities in Norway, and the shares are effectively connected with such business activities, dividends distributed to such shareholder will generally be subject to the same taxation as that of Norwegian Shareholders, cf. the description of tax issues related to Resident Shareholders above. Non-resident Shareholders should consult their own advisers regarding the availability of treaty benefits in respect of dividend payments, including the ability to effectively claim refunds of withholding tax. 12.1.4 Non-resident Shareholders tax-resident within the EEA
Non-resident Shareholders who are individuals tax-resident within the EEA ("Foreign EEA Personal Shareholders") are upon request entitled to a deductible allowance. The shareholder shall pay the lesser amount of (i) withholding tax according to the rate in an applicable tax treaty or (ii) withholding tax at 25% of taxable dividends after allowance. Foreign EEA Personal Shareholders may carry forward any unused allowance, if the allowance exceeds the dividends. Foreign Shareholders that are corporations tax-resident within the EEA for tax purposes ("Foreign EEA Corporate Shareholders") are exempt from Norwegian tax on dividends distributed from Norwegian limited liability companies, provided that the Foreign EEA Corporate Shareholder in fact is genuinely established within the EEA and performs real economic activity within the EEA.
12.2 Taxation upon realization of shares
12.2.1 Resident corporate Shareholders
Norwegian corporate Shareholders are generally exempt from tax on capital gains upon the realization of shares in Norwegian limited liability companies. Losses upon the realization and costs incurred in connection with the purchase and realization of such shares are not deductible for tax purposes.
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12.2.2 Resident personal Shareholders
Norwegian individual shareholders are taxable in Norway for capital gains upon the realization of shares, and have a corresponding right to deduct losses that arise upon such realization. The tax liability applies irrespective of time of ownership and the number of shares realised. Gains are taxable as general income in the year of realization, and losses can be deducted from general income in the year of realization. The tax rate for general income is currently 27%. The taxable gain or loss is calculated per share as the difference between the consideration received and the cost price of the share, including any costs incurred in relation to the acquisition or realization of the share. Any unused allowance on a share (ref. above) may be set off against capital gains related to the realization of the same share, but may not lead to or increase a deductible loss i.e. any unused allowance exceeding the capital gain upon the realization of the share will be lost. Furthermore, unused allowance may not be set of against gains from realization of other shares. If a Shareholder disposes of shares acquired at different times, the shares that were first acquired will be deemed as first sold (the FIFO-principle) when calculating a taxable gain or loss. 12.2.3 Non-resident Shareholders
As a general rule, capital gains generated by Non-resident Shareholders are not taxable in Norway unless (i) the shares are effectively connected with business activities carried out or
managed in Norway (in which case capital gains will generally be subject to the same taxation as that of Norwegian Shareholders, cf the description of tax issues related to Norwegian Shareholders above), or
(ii) the shares are held by an individual who has been a resident of Norway for tax purposes with unsettled/postponed exit tax calculated on the shares at the time of cessation as Norwegian tax resident.
12.3 Net wealth tax
Norwegian limited liability companies and certain similar entities are exempt from Norwegian net wealth tax. For other resident Shareholders (i.e. Shareholders who are individual), the shares will form part of the basis for the calculation of net wealth tax. The current marginal net wealth tax rate is 0.85% of taxable values. Listed shares are valued at 100% of their quoted value on 1 January in the assessment year (the year following the income year).
12.4 Inheritance tax
As of 1 January 2014 the Norwegian Inheritance Tax was abolished. However, the heir acquires the donor's tax input value of the shares based on principles of continuity. Thus, the heir will be taxable for any increase in value in the donor's ownership, at the time of the heir's realization of the shares. However, in the case of gifts distributed to other persons than heirs according to law or testament, the recipient will be able to revalue the received shares to market value.
12.5 Stamp duty
There is currently no Norwegian stamp duty or transfer tax on the transfer or issuance of shares.
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13. THE RIGHTS OFFERING
13.1 Overview
The Rights Offering consists of an offer by the Company to issue 454,430,000 New Shares at a Subscription Price of NOK 1.80 per New Share, thereby raising gross proceeds of approximately USD 100 million. The Company intends to use the net proceeds to serve interest and instalments on its debt in accordance with its repayment schedules and thereby continue to reduce the Company's debt leverage. In addition the net proceeds will be used to make payments under the Company's newbuilding program. Existing Shareholders will be granted tradable Subscription Rights providing a preferential right to subscribe for and be allocated New Shares in the Rights Offering. Oversubscription and subscription without Subscription Rights will be permitted; however, there can be no assurance that New Shares will be allocated for such subscriptions. The largest shareholder of the Company, Siem Europe S.a r.l., has entered into an underwriting agreement with the Company, whereby it will subscribe for any New Shares not otherwise subscribed for in the Rights Offering. See Section 13.20, "The Rights Offering—The Underwriting" for more details. No action will be taken to permit a public offering of the New Shares in any jurisdiction outside of Norway.
13.2 Resolution to Issue the New Shares
On 14 August 2015, an extraordinary general meeting of the Company passed the following resolution to increase the authorized share capital of the Company in connection with the Rights Offering:
To approve the increase of the authorised share capital of the Company from US$5,500,000 divided into 550,000,000 Common Shares of par value US$0.01 each to US$10,000,000 divided into 1,000,000,000 Common Shares of par value US$0.01 each, by the creation of an additional 450,000,000 Common Shares of par value US$0.01 each to rank pari passu in all respects with the existing shares.
On 14 August 2015, the Board of Directors passed the following resolution to issue New Shares in connection with the Rights Offering:
The Board of Directors had earlier approved the Rights Issue in principle at its 10 June 2015 meeting held in Oslo and the purpose of this meeting was to approve the terms of the Rights Issue.
Pursuant to the Rights Issue, the Company will offer 454,430,000 new Common Shares in the Company (the "New Shares") with a nominal value of USD 0.01 each, at a subscription price of NOK 1.80 per New Share (the "Subscription Price"). It was also noted that holders of the Company’s shares registered in the Norwegian Central Securities Depository (the "VPS") as of 18 August 2015 (the "Existing Shareholders") are being granted transferable subscription rights (the "Subscription Rights") that, subject to applicable law, provide preferential rights to subscribe for and be allocated New Shares at the Subscription Price.
Each Existing Shareholder will be granted 1.1724 Subscription Rights for each share registered as held by such Existing Shareholder as of 18 August 2015 (the "Record Date"). Further, each Subscription Right will give the right to subscribe
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for and be allocated one New Share.
The Company has proposed that the subscription period shall commence on 19 August 2015 and expire at 16:30 hours, Central European Time ("CET"), on 2 September 2015 (the "Subscription Period"). If the Subscription Period is postponed, then the Subscription Period shall commence on the second trading day following approval of the Prospectus and end at 16.30 CET on the 14th day thereafter if the Prospectus is not approved in time for the Subscription Period to commence on 19 August 2015. Any New Shares which shall be subscribed for by the underwriters shall be subscribed for within 2 trading days after expiry of the Subscription Period.
The Subscription Rights will be listed and tradable on the Oslo Børs (the "Oslo Stock Exchange") under the ticker code SIOFF T from 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015.
The Prospectus is required to be approved by the Norwegian Financial Supervisory Authority in connection with the Rights Issue. Unless the Directors decide otherwise, the Prospectus shall not be registered with or approved by any foreign authorities. The New Shares cannot be subscribed by investors in jurisdictions in which it is not permitted to offer New Shares to the investors in question without the registration or approval of a Prospectus, unless such registration or approval has taken place pursuant to a resolution by the Directors. With respect to Subscription Rights issued to any shareholder that in the Company’s view is not entitled to subscribe for New Shares due to limitations imposed by laws or regulations of the jurisdiction where such shareholder is a resident or citizen, the Company (or someone appointed or instructed by it) may sell such shareholder's Subscription Rights against transfer of the net proceeds from such sale to the shareholder.
The allocation of New Shares shall be made by the Directors and that the following allocation criteria shall apply:
(i) The allocation will be made to subscribers on the basis of granted and acquired Subscription Rights which have been validly exercised during the Subscription Period. Each Subscription Right will give the right to subscribe for and be allocated 1 New Share;
(ii) If not all Subscription Rights are validly exercised in the Subscription Period, subscribers having exercised their Subscription Rights and who have over-subscribed will have the right to be allocated the remaining New Shares pro rata based on the number of Subscription Rights exercised by the subscriber. In the event that pro rata allocation is not possible, the Company will determine the allocation by lot drawing;
(iii) any remaining New Shares not allocated pursuant to the criteria in items (i) and (ii) above, will be allocated to subscribers not holding Subscription Rights. Allocation will be made pro rata based on the respective subscription amounts, provided, however, that such allocation may be rounded down; and
(iv) if the subscription amount of approximately USD 100,000,000 has not been subscribed and allocated pursuant to the criteria in items (i), (ii) and (iii) above, the outstanding amount will be subscribed by and allocated to the underwriters, based on and in accordance with their respective underwriting obligations. They will receive a
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guarantee commission of 1% on the guaranteed amount.
The due date for payment of the New Shares is 14 September 2015 or the third trading day on Oslo Børs after expiry of the Subscription Period if the Subscription Period is postponed as noted above.
The New Shares will give full shareholder rights in the Company, including the right to dividends, from the time the share capital increase is registered with the Register of Business Enterprises.
The Company's estimated costs in connection with the capital increase are approx. NOK9 million, of which approx. NOK8 million will be consideration for the underwriting guarantee established through separate agreements with the respective underwriter.
13.3 Conditions for Completion of the Rights Offering
The completion of the Rights Offering is subject to the condition that, unless the Rights Offering is fully subscribed, the Underwriting Agreement remaining in full force and effect. Please refer to Section 13.20 "—The Underwriting") below for a description of the underwriting and the Underwriting Agreement and the Shareholder Commitments, including the conditions and termination rights to which the underwriting is subject. If it becomes clear that the above conditions will not be fulfilled, the Rights Offering will be withdrawn. If the Rights Offering is withdrawn, all Subscription Rights will lapse without value, any subscriptions for, and allocations of, New Shares that have been made will be disregarded and any payments for New Shares made will be returned to the subscribers without interest or any other compensation. The lapsing of Subscription Rights shall be without prejudice to the validity of any trades in Subscription Rights, and investors will not receive any refund or compensation in respect of Subscription Rights purchased in the market.
13.4 Timetable
The timetable set out below provides certain indicative key dates for the Rights Offering: Last day of trading in the Shares including Subscription Rights
14 August 2015
First day of trading in the Shares excluding Subscription Right
17 August 2015
Record Date 18 August 2015 Subscription Period commences 19 August 2015 Trading in Subscription Rights commences on the Oslo Stock Exchange 19 August 2015 Trading in Subscription Rights ends End of trading on the Oslo Stock
Exchange on 31 August 2015 Subscription Period ends 2 September 2015 at 16:30 hours (CET) Allocation of the New Shares Expected on or about 4 September 2015 Distribution of allocation letters Expected on or about 4 September 2015 Payment Date 14 September 2015 Delivery of the New Shares Expected on or about 17 September 2015 Listing and commencement of trading in the New Shares on the Oslo Stock Exchange Expected on or about 18 September 2015
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13.5 Subscription Price
The Subscription Price in the Rights Offering is NOK 1.80 per New Share. The Subscription Price represents a discount of approximately 14.29% to the closing price of NOK 2.10 per Share as quoted on 10 June 2015.
13.6 Subscription Period
The Subscription Period will commence on 19 August 2015 and end on 2 September 2015 at 16:30 hours (CET). The Subscription Period may not be extended.
13.7 Record Date
Shareholders who are registered in the Company’s shareholder register in the VPS as of 18 August 2015 (the Record Date) will receive Subscription Rights. Provided that the delivery of traded Shares is made with ordinary T+2 settlement in the VPS, Shares that are acquired until and including 14 August 2015 will give the right to receive Subscription Rights, whereas Shares that are acquired from and including 17 August 2015 will not give the right to receive Subscription Rights.
13.8 Subscription Rights
Existing Shareholders will be granted Subscription Rights giving a preferential right to subscribe for and be allocated New Shares in the Rights Offering. Each Existing Shareholder will be granted 1.1724 tradable Subscription Rights for each Existing Shares registered as held by such Existing Shareholder on the Record Date. The number of Subscription Rights granted to each Existing Shareholder will be rounded down to the nearest whole Subscription Right. Each Subscription Right will, subject to applicable securities laws, give the right to subscribe for and be allocated one New Share in the Rights Offering. The Subscription Rights will be credited to and registered on each Existing Shareholder’s VPS account on or about 19 August 2015 under the International Securities Identification Number (ISIN) KYG812291097. The Subscription Rights will be distributed free of charge to Existing Shareholders. The Subscription Rights may be used to subscribe for New Shares in the Rights Offering before the expiry of the Subscription Period on 2 September 2015 at 16:30 hours (CET) or be sold before the end of trading on the Oslo Stock Exchange on 31 August 2015. Acquired Subscription Rights will give the same right to subscribe for and be allocated New Shares as Subscription Rights held by Existing Shareholders on the basis of their shareholdings on the Record Date. The Subscription Rights, including acquired Subscription Rights, must be used to subscribe for New Shares before the end of the Subscription Period (i.e., 2 September 2015 at 16:30 hours (CET)) or be sold before the end of trading on the Oslo Stock Exchange on 31 August 2015. Subscription Rights which are not sold before the end of trading on the Oslo Stock Exchange on 31 August 2015 or exercised before 2 September 2015 at 16:30 hours (CET) will have no value and will lapse without compensation to the holder. Holders of Subscription Rights (whether granted or acquired) should note that subscriptions for New Shares must be made in accordance with the procedures set out in this Prospectus. Subscription Rights of Existing Shareholders resident in jurisdictions where the Prospectus may not be distributed and/or with legislation that, according to the Company’s assessment, prohibits or otherwise restricts subscription for New Shares (the "Ineligible Shareholders") will initially be credited to such Ineligible Shareholders’ VPS accounts. Such credit specifically does not constitute an offer to Ineligible Shareholders.
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The Company will instruct the Manager to, as far as possible, withdraw the Subscription Rights from such Ineligible Shareholders’ VPS accounts, and sell them from and including 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015 for the account and risk of such Ineligible Shareholders, unless the relevant Subscription Rights are held through a financial intermediary. Please refer to Section 13.12, "—The Underwriting" below for a description of the procedures applicable to Subscription Rights held by Ineligible Shareholders through financial intermediaries. The Manager will use commercially reasonable efforts to procure that the Subscription Rights withdrawn from the VPS accounts of Ineligible Shareholders (and that are not held through financial intermediaries) are sold on behalf of, and for the benefit of, such Ineligible Shareholders during said period, provided that (i) the Manager is able to sell the Subscription Rights at a price at least equal to the anticipated costs related to the sale of such Subscription Rights, and (ii) the relevant Ineligible Shareholder has not by 16:30 hours (CET) on 2 September 2015 documented to the Company through the Manager a right to receive the Subscription Rights withdrawn from its VPS account, in which case the Manager shall re-credit the withdrawn Subscription Rights to the VPS account of the relevant Ineligible Shareholder. The proceeds from the sale of the Subscription Rights (if any), after deduction of customary sales expenses, will be credited to the Ineligible Shareholder’s bank account registered in the VPS for payment of dividends, provided that the net proceeds attributable to such Ineligible Shareholder amount to or exceed NOK 10. If an Ineligible Shareholder does not have a bank account registered in the VPS, the Ineligible Shareholder must contact the Manager to claim the proceeds. If the net proceeds attributable to an Ineligible Shareholder are less than NOK 10, such amount will be retained for the benefit of the Company. There can be no assurance that the Manager will be able to withdraw and/or sell the Subscription Rights at a profit or at all. Other than as explicitly stated above, neither the Company nor the Manager will conduct any sale of Subscription Rights not utilised before the end of the Subscription Period.
13.9 Trading in Subscription Rights
The Subscription Rights will be fully tradable and listed on the Oslo Stock Exchange with ticker code "SIOFF T" and with ISIN KYG812291097 from 19 August 2015 until the end of trading on the Oslo Stock Exchange on 31 August 2015. Subscription Rights acquired during the aforementioned trading period carry the same rights to subscribe for New Shares during the Subscription Period, as Subscription Rights received and held by Eligible Shareholders. The Subscription Rights will hence only be tradable during part of the Subscription Period. Persons intending to trade in Subscription Rights should be aware that the exercise of Subscription Rights by holders who are located in jurisdictions outside Norway may be restricted or prohibited by applicable securities laws. Please refer to Section 14, "Selling and transfer restrictions" for a description of such restrictions and prohibitions.
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13.10 Subscription Procedures
Subscriptions for New Shares must be made by submitting a correctly completed Subscription Form to the Manager or the Receiving Agent during the Subscription Period or, for Norwegian citizens, made online as further described below. Existing Shareholders will receive Subscription Forms that include information about the number of Subscription Rights allocated to the Existing Shareholder and certain other matters relating to the shareholding. Subscriptions for New Shares by subscribers who are not Existing Shareholders must be made on a Subscription Form in the form included in Annex 2 "Form of Subscription Form". Existing Shareholders may also choose to use such a Subscription Form. Correctly completed Subscription Forms must be received by the Manager or the Receiving Agent no later than 16:30 hours (CET) on 2 September 2015 at the following addresses or fax numbers: Swedbank DNB Markets Registrars Department Filipstad Brygge 1 Dronning Eufemias gate 30 P.O. Box 1441 Vika P.O. Box 1600 Sentrum N-0115 Oslo Norway
N-0021 Oslo Norway
Tel.: +47 23 23 80 00 Tel.: +47 23 26 81 01 Fax: +47 23 23 80 11 www.swedbank.no
Email: [email protected] www.dnb.no/emisjoner
Subscribers who are residents of Norway with a Norwegian personal identification number (Nw. personnummer) are encouraged to subscribe for New Shares through the VPS online subscription system (or by following the links on www.swedbank.no and www.dnb.no/emisjoner which will redirect the subscriber to the VPS online subscription system). Neither the Company, the Receiving Agent nor the Manager may be held responsible for postal delays, unavailable fax lines, internet lines or servers or other logistical or technical problems that may result in subscriptions not being received in time or at all by the Manager or the Receiving Agent. Subscription Forms received after the end of the Subscription Period and/or incomplete or incorrect Subscription Forms and any subscription that may be unlawful may be disregarded at the sole discretion of the Company, Receiving Agent and/or the Manager without notice to the subscriber. Subscriptions are binding and irrevocable, and cannot be withdrawn, cancelled or modified by the subscriber after having been received by the Manager or the Receiving Agent. The subscriber is responsible for the correctness of the information filled into the Subscription Form. By signing and submitting a Subscription Form, the subscribers confirm and warrant that they have read this Prospectus and are eligible to subscribe for New Shares under the terms set forth herein. There is no minimum subscription amount for which subscriptions in the Rights Offering must be made. Oversubscription (i.e., subscription for more New Shares than the number of Subscription Rights held by the subscriber entitles the subscriber to be allocated) and subscription without Subscription Rights will be permitted. However, in each case there can be no assurance that New Shares will be allocated for such subscriptions. Multiple subscriptions (i.e., subscriptions on more than one Subscription Form) are allowed. Please note, however, that two separate Subscription Forms submitted by the same subscriber with the same number of New Shares subscribed for on both
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Subscription Forms will only be counted once unless otherwise explicitly stated in one of the Subscription Forms. In the case of multiple subscriptions through the VPS online subscription system or subscriptions made both on a Subscription Form and through the VPS online subscription system, all subscriptions will be counted.
13.11 Mandatory Anti-Money Laundering Procedures
The Rights Offering is subject to the Norwegian Money Laundering Act No. 11 of 6 March 2009 and the Norwegian Money Laundering Regulations No. 302 of 13 March 2009 (collectively the "Anti-Money Laundering Legislation"). Subscribers who are not registered as existing customers of the Manager or the Receiving Agent must verify their identity to the Manager or the Receiving Agent in accordance with requirements of the Anti-Money Laundering Legislation, unless an exemption is available. Subscribers who have designated an existing Norwegian bank account and an existing VPS account on the Subscription Form are exempted, unless verification of identity is requested by the Manager or the Receiving Agent. Subscribers who have not completed the required verification of identity prior to the expiry of the Subscription Period will not be allocated New Shares. Furthermore, participation in the Rights Offering is conditional upon the subscriber holding a VPS account. The VPS account number must be stated in the Subscription Form. VPS accounts can be established with authorised VPS registrars, who can be Norwegian banks, authorised securities brokers in Norway and Norwegian branches of credit institutions established within the EEA. However, non-Norwegian investors may use nominee VPS accounts registered in the name of a nominee. The nominee must be authorised by the NFSA. Establishment of a VPS account requires verification of identification to the VPS registrar in accordance with the Anti-Money Laundering Legislation.
13.12 Financial Intermediaries
All persons or entities holding Shares or Subscription Rights through financial intermediaries (i.e., brokers, custodians and nominees) should read this Section 13.12. All questions concerning the timeliness, validity and form of instructions to a financial intermediary in relation to the exercise, sale or purchase of Subscription Rights should be determined by the financial intermediary in accordance with its usual customer relations procedure or as it otherwise notifies each beneficial shareholder. The Company is not liable for any action or failure to act by a financial intermediary through which Shares are held. 13.12.1 Subscription Rights
If an Existing Shareholder holds Shares registered through a financial intermediary on the Record Date, the financial intermediary will customarily give the Existing Shareholder details of the aggregate number of Subscription Rights to which it will be entitled. The relevant financial intermediary will customarily supply each Existing Shareholder with this information in accordance with its usual customer relations procedures. Existing Shareholders holding Shares through a financial intermediary should contact the financial intermediary if they have received no information with respect to the Rights Offering. Subject to applicable law, Existing Shareholders holding Shares through a financial intermediary may instruct the financial intermediary to sell some or all of their Subscription Rights, or to purchase additional Subscription Rights on their behalf. Please refer to Section 14, "Selling and transfer restrictions" for a description of certain restrictions and prohibitions applicable to the sale and purchase of Subscription Rights in certain jurisdictions outside Norway.
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Existing Shareholders who hold their Shares through a financial intermediary and who are Ineligible Shareholders will not be entitled to exercise their Subscription Rights but may, subject to applicable law, instruct their financial intermediaries to sell their Subscription Rights transferred to the financial intermediary. As described in Section 13.8, "—Subscription Rights", neither the Company nor the Manager or the Receiving Agent will sell any Subscription Rights transferred to financial intermediaries. 13.12.2 Subscription Period and period for trading in Subscription Rights
The time by which notification of exercise instructions for subscription of New Shares must validly be given to a financial intermediary may be earlier than the expiry of the Subscription Period. The same applies for instructions pertaining to trading in Subscription Rights and the last day of trading in such rights (which accordingly will be a deadline earlier than the end of trading on the Oslo Stock Exchange on 31 August 2015. Such deadlines will depend on the financial intermediary. Existing Shareholders who hold their Shares through a financial intermediary should contact their financial intermediary if they are in any doubt with respect to deadlines. 13.12.3 Subscription
Any Existing Shareholder who is not an Ineligible Shareholder and who holds its Subscription Rights through a financial intermediary and wishes to exercise its Subscription Rights, should instruct its financial intermediary in accordance with the instructions received from such financial intermediary. The financial intermediary will be responsible for collecting exercise instructions from the Existing Shareholders and for informing the Manager or the Receiving Agent of their exercise instructions. A person or entity who has acquired Subscription Rights that are held through a financial intermediary should contact the relevant financial intermediary for instructions on how to exercise the Subscription Rights. Please refer to Section 14, "Selling and transfer restrictions" for a description of certain restrictions and prohibitions applicable to the exercise of Subscription Rights in certain jurisdictions outside Norway. 13.12.4 Method of payment
Any Existing Shareholder who holds its Subscription Rights through a financial intermediary should pay the Subscription Price for the New Shares that are allocated to it in accordance with the instructions received from the financial intermediary. The financial intermediary must pay the Subscription Price in accordance with the instructions in the Prospectus. Payment by the financial intermediary for the New Shares must be made to the Manager or the Receiving Agent no later than the Payment Date. Accordingly, financial intermediaries may require payment to be provided to them prior to the Payment Date.
13.13 Allocation of New Shares
Allocation of the New Shares will take place on or about 4 September 2015 in accordance with the following criteria:
i. Allocation will be made to subscribers on the basis of granted and acquired Subscription Rights, which have been validly exercised during the Subscription Period. Each Subscription Right will give the right to subscribe for and be allocated one New Share in the Rights Offering.
ii. If not all Subscription Rights are exercised, subscribers having exercised their Subscription Rights and who have oversubscribed will be allocated additional New Shares on a pro rata basis based on the number of Subscription Rights exercised
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by each such subscriber. To the extent that pro rata allocation is not possible, the Company will determine the allocation by the drawing of lots.
iii. New Shares not allocated pursuant to (i) and (ii) above will be allocated to subscribers not holding Subscription Rights. Allocation will be sought made on a pro rata basis based on the relevant subscription amounts.
iv. New Shares not allocated pursuant to (i), (ii) and (iii) above will be subscribed by, and allocated to, the Underwriter.
No fractional New Shares will be allocated. The Company reserves the right to round off, reject or reduce any subscription for New Shares not covered by Subscription Rights. Allocation of fewer New Shares than subscribed for by a subscriber will not impact on the subscriber’s obligation to pay for the number of New Shares allocated. The result of the Rights Offering is expected to be published on or about 3 September 2015 in the form of a stock exchange notification from the Company through the Oslo Stock Exchange information system and at the Company’s website (http://www.siemoffshore.com/). Notifications of allocated New Shares and the corresponding subscription amount to be paid by each subscriber are expected to be distributed in a letter from the VPS on or about 4 September 2015. Subscribers having access to investor services through their VPS account manager will be able to check the number of New Shares allocated to them from 12:00 hours (CET) on 4 September 2015. Subscribers who do not have access to investor services through their VPS account manager may contact the Manager or the Receiving Agent from 14:00 hours (CET) on 4 September 2015 to get information about the number of New Shares allocated to them.
13.14 Payment for the New Shares
The payment for New Shares allocated to a subscriber falls due on the Payment Date (14 September 2015). Payment must be made in accordance with the requirements set out in Sections 13.14.1 "—Subscribers who have a Norwegian bank account" or 13.14.2 "—Subscribers who do not have a Norwegian bank account" below. 13.14.1 Subscribers who have a Norwegian bank account
Subscribers who have a Norwegian bank account must, and will by signing the Subscription Form, provide the Manager or the Receiving Agent with a one-time irrevocable authorisation to debit a specified bank account with a Norwegian bank for the amount payable for the New Shares which are allocated to the subscriber. The specified bank account is expected to be debited on or after the Payment Date. The Manager or the Receiving Agent is only authorised to debit such account once, but reserves the right to make up to three debit attempts, and the authorisation will be valid for up to seven working days after the Payment Date. The subscriber furthermore authorises the Manager or the Receiving Agent to obtain confirmation from the subscriber’s bank that the subscriber has the right to dispose over the specified account and that there are sufficient funds in the account to cover the payment. If there are insufficient funds in a subscriber’s bank account or if it for other reasons is impossible to debit such bank account when a debit attempt is made pursuant to the authorisation from the subscriber, the subscriber’s obligation to pay for the New Shares will be deemed overdue. Payment by direct debiting is a service that banks in Norway provide in cooperation. In the relationship between the subscriber and the subscriber’s bank, the standard terms
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and conditions for "Payment by Direct Debiting – Securities Trading", which are set out on page 2 of the Subscription Form, will apply, provided, however, that subscribers who subscribe for an amount exceeding NOK 5 million by signing the Subscription Form provide the Manager or the Receiving Agent with a one-time irrevocable authorisation to directly debit the specified bank account for the entire subscription amount. 13.14.2 Subscribers who do not have a Norwegian bank account
Subscribers who do not have a Norwegian bank account must ensure that payment with cleared funds for the New Shares allocated to them is made on or before the Payment Date. Prior to any such payment being made, the subscriber must contact the Manager or the Receiving Agent for further details and instructions. 13.14.3 Overdue payments
Overdue payments will be charged with interest at the applicable rate from time to time under the Norwegian Act on Interest on Overdue Payment of 17 December 1976 No. 100, currently 9.00% per annum. If a subscriber fails to comply with the terms of payment, the New Shares will not be delivered to the subscriber.
13.15 Delivery of the New Shares
The Company expects that the New Shares will be issued on or about 17 September 2015 and that the New Shares will be delivered to the VPS accounts of the subscribers to whom they are allocated on or about the same day.
13.16 Listing of the New Shares
The Shares are listed on the Oslo Stock Exchange under ticker code "SIOFF". The New Shares will be listed on the Oslo Stock Exchange as soon as the New Shares have been issued and registered in the VPS. This is expected to take place on or about 18 September 2015. The listing of the New Shares on the Oslo Stock Exchange is expected to take place on the same day. The New Shares may not be transferred or traded before they are fully paid and said registration the VPS has taken place.
13.17 The rights conferred by the New Shares
The New Shares issued in the Rights Offering will be ordinary shares in the Company having a nominal value of USD 0.01 each and will be issued electronically in registered form. The New Shares will rank pari passu in all respects with the Existing Shares and will carry full shareholder rights in the Company from the time of issue. The New Shares will be eligible for any dividends which the Company may declare after said registration. Please refer to Section 10, "Corporate information", for a more detailed description of the Shares.
13.18 VPS registration
The Subscription Rights will be registered with the VPS under the International Securities Identification Number (ISIN) KYG812291097. The New Shares will be registered in the VPS with the same International Securities Identification Number as the Existing Shares, being ISIN KYG813131011. The Company’s registrar in the VPS is Nordea Bank Norge ASA, Postboks 1166 Sentrum, 0107 Oslo, Norway.
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13.19 Dilution
The Rights Offering will result in an immediate dilution of approximately 54% for Existing Shareholders who do not participate in the Rights Offering.
13.20 The underwriting
The largest shareholder of the Company, Siem Europe S.a r.l., having its registered address on 11-13, Boulevard de la Foire, L-1528 Luxembourg, Grand Duchy of Luxembourg, has on 11 August 2015 entered into the Underwriting Agreement with the Company whereby they undertake to guarantee for the subscription of all New Shares not subscribed for by other subscribers. Siem Europe S.a r.l. will receive an underwriting commission of 1.00% of the underwriting obligation. The underwriting obligation of Siem Europe S.a r.l. is conditional upon no change, event, effect, or condition (which shall result not only from events occurring after the signing of the Underwriting Agreement, but also as a result of, separately or in combination with, any previously undisclosed circumstances) occurring prior to such time as payment for the Offer Shares is due, that has or would be expected to have, in the opinion of Siem Europe S.a r.l., acting in good faith, individually or in the aggregate, a material adverse effect on the conditions, assets, operations, results or prospectus of the Company and its subsidiaries taken as a whole.
13.21 Net proceeds and expenses relating to the Rights Offering
The Company will bear the fees and expenses related to the Rights Offering, which are estimated to amount to approximately NOK 2 million, consisting of fees to the Manager and the Receiving Agent and other fees and expenses related to the Rights Issue. In addition the underwriters' commission is 1% of the underwriting obligation as described in Section 13.20, "—The Underwriting" above. No expenses or taxes will be charged by the Company or the Manager to the subscribers in the Rights Offering. Total net proceeds from the Rights Offering are estimated to amount to approximately USD 99 million.
13.22 Interests of natural and legal persons involved in the Rights Offering
The Manager and the Receiving Agent, or their affiliates, have provided from time to time, and may provide in the future, investment and commercial banking services to the Company and its affiliates in the ordinary course of business, for which they may have received and may continue to receive customary fees and commissions. The Manager and the Receiving Agent, their employees and any affiliate may currently own Existing Shares in the Company. Further, in connection with the Rights Offering, the Manager and the Receiving Agent, their employees and any affiliate acting as an investor for its own account may receive Subscription Rights (if they are Existing Shareholders) and may exercise its right to take up such Subscription Rights and acquire New Shares, and, in that capacity, may retain, purchase or sell Subscription Rights or New Shares and any other securities of the Company or other investments for its own account and may offer or sell such securities (or other investments) otherwise than in connection with the Rights Offering. The Manager and the Receiving Agent do not intend to disclose the extent of any such investments or transactions otherwise than in accordance with any legal or regulatory obligation to do so. The Manager and the Receiving Agent will receive a management fee in connection with the Offering and, as such, have an interest in the Offering.
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13.23 Participation of Major Existing Shareholders and Members of the Company’s Management, Supervisory and Administrative Bodies in the Rights Offering
The Company's largest shareholders, Siem Europe S.a r.l, has underwritten the Rights Offering. Please see Section 13.20, "—The Underwriting".
13.24 Publication of information relating to the Rights Offering
In addition to press releases which will be posted on the Company’s website, the Company will use the Oslo Stock Exchange information system to publish information relating to the Rights Offering.
13.25 Governing law and jurisdiction
This Prospectus, the Subscription Forms and the terms and conditions of the Rights Offering shall be governed by and construed in accordance with Norwegian law. Any dispute arising out of, or in connection with, this Prospectus or the Rights Offering shall be subject to the exclusive jurisdiction of the courts of Norway, with Oslo as legal venue.
13.26 Manager, Receiving Agent and advisors
The Rights Issue is managed by Swedbank, Filipstad Brygge 1, P.O Box 1441 Vika, N-0115 Oslo, Norway. DNB Markets, Dronning Eufemias gate 30, P.O. Box 1600 Sentrum, 0021 Oslo, Norway is acting as Receiving Agent in the Rights Issue. Advokatfirmaet Wiersholm AS has acted as the Company's legal adviser in connection with the Rights Issue.
13.27 How to proceed
The below instructions apply to subscriptions for New Shares on the basis of Subscription Rights. Please see above for further details of the Rights Offering, including details on oversubscription and subscription without Subscription Rights. Terms and conditions ................................ For each Existing Shares you own, you will
receive 1.1724 Subscription Rights. Each Subscription Right gives an entitlement to subscribe for and to be allocated one New Share.
Subscription Price ..................................... NOK 1.80 per New Share.
Record Date for determining the right to receive Subscription Rights ........................
18 August 2015 (i.e. shareholders who are registered in the Company’s shareholder register in the VPS as of 18 August 2015 will receive Subscription Rights).
Trading in Subscription Rights .................... 19 August 2015 to the end of trading on the Oslo Stock Exchange on 31 August 2015.
Subscription Period ................................... 19 August 2015 to 2 September 2015 at 16:30 hours (CET).
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14. SELLING AND TRANSFER RESTRICTIONS
14.1 General
As a consequence of the following restrictions, prospective investors are advised to consult legal counsel prior to making any offer, resale, pledge or other transfer of the Shares offered hereby.
Other than in Norway, the Company is not taking any action to permit a public offering of the Shares in any jurisdiction. Receipt of this Prospectus will not constitute an offer in those jurisdictions in which it would be illegal to make an offer and, in those circumstances, this Prospectus is for information only and should not be copied or redistributed. Except as otherwise disclosed in this Prospectus, if an investor receives a copy of this Prospectus in any jurisdiction other than Norway, the investor may not treat this Prospectus as constituting an invitation or offer to it, nor should the investor in any event deal in the Shares, unless, in the relevant jurisdiction, such an invitation or offer could lawfully be made to that investor, or the Shares could lawfully be dealt in without contravention of any unfulfilled registration or other legal requirements. Accordingly, if an investor receives a copy of this Prospectus, the investor should not distribute or send the same, or transfer Shares, to any person or in or into any jurisdiction where to do so would or might contravene local securities laws or regulations.
14.2 Selling restrictions
14.2.1 United States
The New Shares have not been and will not be registered under the U.S. Securities Act, and may not be offered or sold except: (i) within the United States to QIBs in reliance on Rule 144A; or (ii) to certain persons in offshore transactions in compliance with Regulation S under the U.S. Securities Act, and in accordance with any applicable securities laws of any state or territory of the United States or any other jurisdiction. Accordingly, each Manager has represented and agreed that it has not offered or sold, and will not offer or sell, any of the New Shares as part of its allocation at any time other than to QIBs in the United States in accordance with Rule 144A or outside of the United States in compliance with Rule 903 of Regulation S. Transfer of the New Shares will be restricted and each purchaser of the New Shares in the United States will be required to make certain acknowledgements, representations and agreements, as described under Section 18.3.1 "—Transfer restrictions—United States".
Any offer or sale in the United States will be made by affiliates of the Manager who are broker-dealers registered under the U.S. Exchange Act. In addition, until 40 days after the commencement of the Rights Offering, an offer or sale of New Shares within the United States by a dealer, whether or not participating in the Rights Offering, may violate the registration requirements of the U.S. Securities Act if such offer or sale is made otherwise than in accordance with Rule 144A of the U.S. Securities Act and in connection with any applicable state securities laws.
14.2.2 United Kingdom
This Prospectus and any other material in relation to the Rights Offering described herein is only being distributed to, and is only directed at persons in the United Kingdom who are qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive (“qualified investors”) that are also (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); (ii) high net worth entities or other persons falling within Article 49(2)(a) to (d) of the Order; or (iii) persons to whom distributions may otherwise lawfully be made (all such persons together being referred to as “Relevant Persons”). The Offer Shares are only available to, and any investment or investment activity to which this Prospectus relates is available only to, and will be engaged in only with, Relevant Persons). This Prospectus and its contents are confidential and should not be distributed,
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published or reproduced (in whole or in part) or disclosed by recipients to any other person in the United Kingdom. Persons who are not Relevant Persons should not take any action on the basis of this Prospectus and should not rely on it.
14.2.3 European Economic Area
In relation to each Relevant Member State, with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the "Relevant Implementation Date"), an offer to the public of any New Shares which are the subject of the offering contemplated by this Prospectus may not be made in that Relevant Member State, other than the offering in Norway as described in this Prospectus, once the Prospectus has been approved by the competent authority in Norway and published in accordance with the Prospectus Directive (as implemented in Norway), except that an offer to the public in that Relevant Member State of any New Shares may be made at any time with effect from and including the Relevant Implementation Date under the following exemptions under the Prospectus Directive, if they have been implemented in that Relevant Member State:
a) to legal entities which are qualified investors as defined in the Prospectus Directive;
b) to fewer than 100, or, if the Relevant Member State has implemented the relevant provisions of the 2010 PD Amending Directive, 150, natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the Manager for any such offer, or in any other circumstances falling within Article 3(2) of the Prospectus Directive; provided that no such offer of New Shares shall require the Company or any Manager to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to Article 16 of the Prospectus Directive.
For the purposes of this provision, the expression an "offer to the public" in relation to any New Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any Securities to be offered so as to enable an investor to decide to purchase any New Shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State the expression " Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in each Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.
This EEA selling restriction is in addition to any other selling restrictions set out in this Prospectus.
14.2.4 Additional jurisdictions
Canada This Prospectus is not, and under no circumstance is to be construed as, a prospectus, an advertisement or a public offering of the New Shares in Canada or any province or territory thereof. Any offer or sale of the New Shares in Canada will be made only pursuant to an exemption from the requirements to file a prospectus with the relevant Canadian securities regulators and only by a dealer properly registered under applicable provincial securities laws or, alternatively, pursuant to an exemption from the dealer registration requirement in the relevant province or territory of Canada in which such offer or sale is made.
Hong Kong The New Shares may not be offered or sold in Hong Kong by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap. 32) of Hong Kong, or (ii) to "professional
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investors" within the meaning of the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a "prospectus" within the meaning of the Companies Ordinance (Cap. 32) of Hong Kong, and no advertisement, invitation or document relating to the New Shares may be issued or may be in the possession of any person for the purposes of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to New Shares which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made thereunder.
Singapore This Prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this Prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the New Shares may not be circulated or distributed, nor may they be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the "SFA"), (ii) to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
14.2.5 Other jurisdictions
The New Shares may not be offered, sold, resold, transferred or delivered, directly or indirectly, in or into, Japan, Australia or any other jurisdiction in which it would not be permissible to offer the New Shares.
In jurisdictions outside the United States and the EEA where the Rights Offering would be permissible, the New Shares will only be offered pursuant to applicable exceptions from prospectus requirements in such jurisdictions.
14.3 Transfer restrictions
14.3.1 United States
The New Shares have not been and will not be registered under the U.S. Securities Act and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and applicable state securities laws. Terms defined in Rule 144A or Regulation S shall have the same meaning when used in this Section.
Each purchaser of the New Shares outside the United States pursuant to Regulation S will be deemed to have acknowledged, represented and agreed that it has received a copy of this Prospectus and such other information as it deems necessary to make an informed decision and that:
• The purchaser is authorised to consummate the purchase of the New Shares in compliance with all applicable laws and regulations.
• The purchaser acknowledges that the New Shares have not been and will not be registered under the U.S. Securities Act, or with any securities regulatory authority or any state of the United States, and are subject to significant restrictions on transfer.
• The purchaser is, and the person, if any, for whose account or benefit the purchaser is acquiring the New Shares was located outside the United States at the time the buy order for the New Shares was originated and continues to be
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located outside the United States and has not purchased the New Shares for the benefit of any person in the United States or entered into any arrangement for the transfer of the New Shares to any person in the United States.
• The purchaser is not an affiliate of the Company or a person acting on behalf of such affiliate, and is not in the business of buying and selling securities or, if it is in such business, it did not acquire the New Shares from the Company or an affiliate thereof in the initial distribution of such Shares.
• The purchaser is aware of the restrictions on the offer and sale of the New Shares pursuant to Regulation S described in this Prospectus.
• The New Shares have not been offered to it by means of any "directed selling efforts" as defined in Regulation S.
• The Company shall not recognise any offer, sale, pledge or other transfer of the New Shares made other than in compliance with the above restrictions.
• The purchaser acknowledges that the Company, the Manager and their respective advisers will rely upon the truth and accuracy of the foregoing acknowledgements, representations and agreements.
Each purchaser of the New Shares within the United States pursuant to Rule 144A will be deemed to have acknowledged, represented and agreed that it has received a copy of this Prospectus and such other information as it deems necessary to make an informed investment decision and that:
• The purchaser is authorised to consummate the purchase of the New Shares in compliance with all applicable laws and regulations.
• The purchaser acknowledges that the New Shares have not been and will not be registered under the U.S. Securities Act or with any securities regulatory authority of any state of the United States and are subject to significant restrictions to transfer.
• The purchaser (i) is a QIB (as defined in Rule 144A), (ii) is aware that the sale to it is being made in reliance on Rule 144A and (iii) is acquiring such New Shares for its own account or for the account of a QIB, in each case for investment and not with a view to any resale or distribution to the New Shares.
• The purchaser is aware that the New Shares are being offered in the United States in a transaction not involving any public offering in the United States within the meaning of the U.S. Securities Act.
• If, in the future, the purchaser decides to offer, resell, pledge or otherwise transfer such New Shares, as the case may be, such Shares may be offered, sold, pledged or otherwise transferred only (i) to a person whom the beneficial owner and/or any person acting on its behalf reasonably believes is a QIB in a transaction meeting the requirements of Rule 144A, (ii) in accordance with Regulation S, (iii) in accordance with Rule 144 (if available), (iv) pursuant to any other exemption from the registration requirements of the U.S. Securities Act, subject to the receipt by the Company of an opinion of counsel or such other evidence that the Company may reasonably require that such sale or transfer is in compliance with the U.S. Securities Act or (v) pursuant to an effective registration statement under the U.S. Securities Act, in each case in accordance with any applicable securities laws of any state or territory of the United States or any other jurisdiction.
• The purchaser is not an affiliate of the Company or a person acting on behalf of such affiliate, and is not in the business of buying and selling securities or, if it is in such business, it did not acquire the New Shares from the Company or an affiliate thereof in the initial distribution of such Shares.
• The New Shares are "restricted securities" within the meaning of Rule 144(a) (3)
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and no representation is made as to the availability of the exemption provided by Rule 144 for resales of any New Shares, as the case may be.
• The Company shall not recognise any offer, sale pledge or other transfer of the New Shares made other than in compliance with the above-stated restrictions.
• The purchaser acknowledges that the Company, the Manager and their respective advisers will rely upon the truth and accuracy of the foregoing acknowledgements, representations and agreements.
14.3.2 European Economic Area
• Each person in a Relevant Member State (other than, in the case of paragraph (a), persons receiving offers contemplated in this Prospectus in Norway) who receives any communication in respect of, or who acquires any New Shares under, the offers contemplated in this Prospectus will be deemed to have represented, warranted and agreed to and with each Manager and the Company that:
• it is a qualified investor as defined in the Prospectus Directive; and
• in the case of any New Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (i) the New Shares acquired by it in the offer have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than qualified investors, as that term is defined in the Prospectus Directive, or in circumstances in which the prior consent of the Manager has been given to the offer or resale; or (ii) where New Shares have been acquired by it on behalf of persons in any Relevant Member State other than qualified investors, the offer of those Shares to it is not treated under the Prospectus Directive as having been made to such persons.
• For the purposes of this representation, the expression an "offer" in relation to any New Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any New Shares to be offered so as to enable an investor to decide to purchase or subscribe for the New Shares, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression " Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in each Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.
105
15. ADDITIONAL INFORMATION
15.1 Legal Proceedings
There are no governmental, legal or arbitration proceedings, including any such proceedings which are pending or threatened, during a period covering at least the previous 12 months which may have, or have had in the recent past significant effects on the Group’s financial position or profitability.
15.2 Material Contracts
Neither the Group nor any member of the Group has entered into any material contracts outside the ordinary course of business for the two years prior to the date of this Prospectus. Further, the Group has not entered into any other contract outside the ordinary course of business which contains any provision under which any member of the Group has any obligation or entitlement.
15.3 Related Party Transactions
Siem Industries Inc. is the parent company of Siem Europe S.a r.l. the Company’s largest shareholder with a holding of 34.39%, and is defined as a related party. The Company is obligated to Siem Industries Inc., for a fee of USD 250K (2013: USD 300K). This fee is the remuneration for the services of two of the Board Members. This fee also covers office in the Cayman Islands and administrative services. The main shareholder of the Company, Siem Europe S.a r.l. is controlled by a trust where certain members of Kristian Siem’s family are potential beneficiaries. Kristian Siem, who is a member of the Board of the Company, is also inter alia the chairman of the board of directors of Siem Industries Inc. and of Subsea 7 S.A., the charterer of the OSCV "Siem Stingray". The contract between the Company and Subsea 7 S.A is made on arm's length terms. In September 2014 Siem Industries Inc., which is the beneficial owner of Siem Europe S.a r.l., announced the acquisition of Flensburger Schiffbau-Gesellschaft mbH & Co. KG which is building the two Well-Intervention Vessels under construction by the Company. The contract between Flensburger Schiffbau-Gesellschaft mbH & Co. KG is made on arm's length terms. In November 2014, the Company provided a loan of EUR 15 million to Siem Industries Inc. as part of the restructuring of Flensburger Schiffbau-Gesellschaft mbH & Co. KG. The loan was provided to ensure delivery of the two Well-Intervention Vessels under construction and shall be utilized to finance the yard. EUR 10 million of the funding of the loan was provided by Helix Energy Solutions Group Inc. by way of prepayment of charter hire for the two Well-Intervention Vessels. The loan is at market terms and matures when the last of the two Well-Intervention Vessels have been delivered from the yard. At the end of 2014 a short term loan of USD 60 million was drawn by the Company under a credit facility provided by Siem Industries Inc. The short term loan is on market terms. In June 2015, a short term loan of USD 15 million was provided by Siem Industries Inc. to the Company. The short term loan is on market terms. The Company has currently not drawn on the short term loan, and any undrawn portion of the USD 15 million commitment will be cancelled, and any drawn amounts will mature, when the proceeds from the Rights Offering has been received by the Company.
15.4 Documents on display
Copies of the following documents will be available for inspection at the Company's offices and at the offices of Siem Offshore Management AS at Nodeviga 14, 4610
106
Kristiansand, during normal business hours from Monday to Friday each week (except public holidays) for a period of twelve months from the date of this Prospectus.
• The Company's Articles of Association and Certificate of Incorporation.
• The Group's audited consolidated annual financial statement for the year ended 31 December 2014.
• This Prospectus.
15.5 Statement regarding sources
The Company confirms that when information in this Prospectus has been sourced from a third party it has been accurately reproduced and as far as the Company is aware and is able to ascertain from the information published by that third party, no facts have been omitted which would render the reproduced information inaccurate or misleading.
107
16. DEFINITIONS AND GLOSSARY
The following definitions and glossary apply in this Prospectus unless otherwise dictated by the context, including the foregoing pages of this Prospectus.
AHTS Anchor-handling, tug, supply vessel.
Anti-Money Laundering Legislation
the Norwegian Money Laundering Act No. 11 of 6 March 2009 and the Norwegian Money Laundering Regulations No. 302 of 13 March 2009.
Articles of Association The memorandum and articles of association of the Company.
Board Members The members of the Board of Directors.
Board of Directors or Board The board of directors of the Company.
CET Central European Time
CLV Cable-Lay Vessel.
COFTA Central Office for Foreign Tax Affairs (Norwegian: Sentralskattekontoret for utenlandssaker).
Company Siem Offshore Inc.
Corporate Governance Code
The Norwegian Code of Practice for Corporate Governance dated 30 October 2014.
DP Dynamically positioned.
DSND Det Søndenfjeldske-Norske Dampskipselskap AS.
EEA The European Economic Area.
ERD Extended Reach Drilling.
Existing Shares The issued Shares as of the date of this Prospectus.
Existing Shareholders Holders of the Company’s shares as registered in the VPS as of 18 August 2015.
EU The European Union.
EU Prospectus Directive
Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State) and includes any relevant implementing measure in each Relevant Member State.
FCV Fast crew vessel.
Foreign EEA Corporate Shareholders
Foreign Shareholders that are corporations tax-resident within the EEA for tax purposes.
108
Foreign EEA Personal Shareholders
Non-resident Shareholders who are individuals tax-resident within the EEA.
Forward-looking statements
Statements made that are not historic and thereby predictive as defined in Section 4.3.
FOS Five Oceans Services.
FSV Fast supply vessel.
General Meeting The Company’s general meeting of shareholders.
Group The Company and its subsidiaries.
HPHT High pressure high temperature.
IFRS International Financial Reporting Standards as adopted by the EU.
Ineligible Shareholders
Existing Shareholders resident in jurisdictions where the Prospectus may not be distributed and/or with legislation that, according to the Company’s assessment, prohibits or otherwise restricts subscription for New Shares.
ISIN Securities number in the Norwegian Central Securities Depository (VPS).
ISV Installation support vessel.
Listing The listing of the New Shares on Oslo Børs.
Management The Group’s senior management team.
Manager Swedbank.
MPD Managed pressure drilling.
MPSV Multipurpose Platform Supply Vessels.
New Shares The 454,430,000 new Shares issued in connection with the Rights Offering
NOK Norwegian Kroner, the lawful currency of Norway.
Non-resident Shareholders Shareholders who are not resident in Norway for tax purposes.
Norwegian FSA The Financial Supervisory Authority of Norway (Nw.: Finanstilsynet).
Norwegian corporate shareholders
Shareholders who are limited liability companies and certain similar corporate entities resident in Norway for tax purposes.
Norwegian personal shareholders
Personal shareholders resident in Norway for tax purposes.
Norwegian Securities Trading Act
The Norwegian Securities Trading Act of 29 June 2007 no. 75 (Nw.: verdipapirhandelloven).
109
OCI Other comprehensive income.
ODL Overseas Drilling Limited.
Order The Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended.
OSCV Offshore subsea construction vessel.
Oslo Stock Exchange Oslo Børs ASA or, as the context may require, Oslo Børs, a Norwegian regulated stock exchange operated by Oslo Børs ASA.
OSRV Oil spill recovery vessels.
OSV Offshore support vessel.
OWF Offshore Wind Farm.
Prospectus This Prospectus.
Prospectus Directive
Commission Regulation (EC) No. 809/2004 implementing Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 regarding information contained in prospectuses, as amended, and as implemented in Norway
PCD Pressure control device.
PSV Platform supply vessel.
QIBs Qualified institutional buyers, as defined in Rule 144A under the U.S. Securities Act.
Receiving Agent DNB Markets
Record date 18 August 2015
Relevant Member State Each Member State of the EEA which has implemented the EU Prospectus Directive.
Rights Offering The offering of New Shares described in this Prospectus.
Resident Shareholders Shareholders that are residents of Norway for purposes of Norwegian taxation.
Relevant Persons
Persons in the UK that are (i) investment professionals falling within Article 19(5) of the Order or (ii) high net worth entities, and other persons to whom the Prospectus may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order.
RPCD Unique sealing technology for the existing PCD products and other arising applications, for example a seal to be used from floating drilling units.
Secunda Secunda Holdings Limited.
110
SFA The Securities and Futures Act of Singapore.
Share(s) Common shares in the share capital of the Company or any one of them.
Siem Offshore The Company and its subsidiaries
SOC Siem Offshore Contractors GmbH.
Subscription Period From 19 August 2015 to 16:30 hours (CET) on 2 September 2015.
Subscription Price The subscription price for New Shares in the Rights Offering, being NOK 1.80 per New Share.
Subscription Rights The transferable subscription rights being issued to holders of Existing Shares in connection with the Rights Offering.
TAMRF Texas A&M Research Foundation.
UBO Underbalanced Operations.
UK United Kingdom.
Underwriter Siem Europe S.a r.l.
Underwriting Agreement The Underwriting Agreement dated 11 August 2015 between the Company and the Underwriter.
USD United States Dollar, the lawful currency of the United States of America.
U.S. Exchange Act The United States Securities Exchange Act of 1934, as amended.
U.S. Securities Act The United States Securities Act of 1933, as amended.
VPS The Norwegian Central Securities Depository (Nw.: Verdipapirsentralen).
WIV or Well-Intervention Vessel Well-intervention vessel.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
45
AN
NU
AL
RE
PO
RT
20
14
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
46
Ke
y F
igu
res
3
Hig
hli
gh
ts 2
01
45
Ne
w v
ess
els
De
live
red
in 2
01
46
Ne
wb
uil
din
gs
8
Fle
et
Lis
t M
arc
h 2
01
510
Lo
cal
pre
sen
ce in
ke
y m
ark
ets
31
.03
.20
15
12
Th
is is
Sie
m O
ffsh
ore
Inc.
14
Bo
ard
of
Dir
ect
or’
s R
ep
ort
16
Co
rpo
rate
Go
vern
an
ce22
Inco
me
Sta
tem
en
ts25
Sta
tem
en
ts o
f F
ina
nci
al
Po
siti
on
– A
sse
ts26
Sta
tem
en
ts o
f F
ina
nci
al
Po
siti
on
– E
qu
ity
an
d L
iab
ilit
ies
27
Sta
tem
en
ts o
f C
ha
ng
es
In E
qu
ity
28
Sta
tem
en
ts o
f C
ash
Flo
ws
30
No
tes
to t
he
Acc
ou
nts
32
Co
rpo
rate
So
cia
l R
esp
on
sib
ilit
y98
Au
dit
or’
s R
ep
ort
100
Re
spo
nsi
bil
ity
Sta
tem
en
t10
2
Bo
ard
of
Dir
ect
ors
103
Fin
an
cia
l C
ale
nd
ar
104
CO
NT
EN
TS
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
47
KE
Y FI
GU
RES
(Am
ount
s in
USD
1,0
00)
Con
solid
ated
INC
OM
E ST
ATEM
ENTS
Ref
2014
2013
Ope
ratin
g re
venu
e 4
91,3
12
363
,955
Ope
ratin
g ex
pens
es -
297,
187
-24
1,29
1
Ope
ratin
g m
argi
n(1
) 1
94,1
25
122
,663
Ope
ratin
g m
argi
n, %
40%
34%
Dep
reci
atio
n an
d am
ortiz
atio
n -
125,
883
-75
,841
Gai
n/(lo
ss) o
n sa
le o
f ass
ets
18,
728
29,
827
Gai
n on
sal
e of
inte
rest
rat
e de
rivat
ives
(CIR
R)
368
3
68
Gai
n/(lo
ss) o
n cu
rren
cy e
xcha
nge
forw
ard
cont
ract
s -
3,02
3 -
7,75
6
(2)
84,
316
69,
261
17%
19%
-12
,685
-
53,3
49
Res
ult f
rom
ass
ocia
ted
com
pani
es 1
,808
2
,046
73,
439
17,
959
15%
5%
-2,
729
3,5
85
70,
710
21,
544
Min
oriti
es in
tere
st 1
2,56
3 -
456
58,
147
22,
000
12%
6%
Stat
emen
ts o
f Fin
anci
al P
ositi
on12
/31/
1412
/31/
13
Non
-cur
rent
ass
ets
1,9
95,8
09
1,6
89,8
86
Cur
rent
ass
ets
264
,774
1
94,6
96
Wor
king
cap
ital
(3)
-17
,419
2
1,11
2
Tota
l ass
ets
2,2
60,5
84
1,9
02,7
02
Sha
reho
lder
s’ e
quity
784
,982
7
56,6
28
1,1
54,7
42
935
,231
282
,193
1
73,5
84
2,2
60,5
84
1,9
02,7
02
Stat
emen
ts o
f Cas
h Fl
ows
2014
2013
(4)
184
,345
5
8,98
6
(4)
43,
401
-9,
028
Key
Fig
ures
20
1420
13
Wei
ghte
d av
erag
e no
. of o
utst
andi
ng s
hare
s (1
,000
) 3
87,5
91
389
,078
Wei
ghte
d av
erag
e no
. of d
ilute
d ou
tsta
ndin
g sh
ares
(1,0
00)
389
,144
3
89,1
44
Ear
ning
s pe
r sh
are
(US
D)
0
,15
0,0
6
Dilu
ted
earn
ings
per
sha
re (U
SD
0,1
5 0
,06
(5)
0,4
8 0
,15
Sha
re p
rice
per
year
end
(US
D)
0,5
4 1
,59
Sha
re p
rice
per
year
end
(NO
K)
4,0
4 9
,65
Pric
e/ea
rnin
gs p
er s
hare
(P/E
)(6
) 3
,62
28,
05
(7)
1,1
4 1
0,42
Boo
k sh
areh
olde
rs’ e
quity
per
sha
re (U
SD
)(8
) 2
,03
2,0
0
Ope
ratin
g m
argi
n sh
are
(9)
0,5
0 0
,32
Boo
k eq
uity
rat
io(1
0) 0
,36
0,4
1
Liqu
idity
rat
io(1
1) 0
,94
1,1
2 SI
EM O
FFSH
ORE
INC.
, AN
NU
AL
REPO
RT 2
014
8
27 T
OTA
L
34 T
OTA
L
32 T
OTA
L40 T
OTA
L
44 T
OTA
L
42 T
OTA
L
45 T
OTA
L
31/1
2/20
05
31/1
2/20
06
31/1
2/20
07
31/1
2/20
08
31/1
2/20
09
31/1
2/20
10
31/1
2/20
11
Vess
els
in o
pera
tion 27
TO
TAL
34 T
OTA
L
32 T
OTA
L40 T
OTA
L
44 T
OTA
L
45 T
OTA
L
42 T
OTA
L
0-51
%10
0%
31/1
2/20
12
31/1
2/20
05
31/1
2/20
06
31/1
2/20
07
31/1
2/20
08
31/1
2/20
09
31/1
2/20
10
31/1
2/20
11
31/1
2/20
1247
TO
TAL
47 T
OTA
L
VES
SE
LS
OW
NE
RS
HIP
31/1
2/20
1355
TO
TAL
31/1
2/20
1355
TO
TAL
Defi
nitio
ns
(10)
Boo
k eq
uity
div
ided
on
tota
l ass
ets
31/1
2/20
1455
TO
TAL
31/1
2/20
1455
TO
TAL
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
45
REV
ENU
E U
SD 1
,000
49
1 3
12
PR
OFI
T B
EFO
RE
TAX
USD
1,0
00
73
43
9EM
PLO
YEES
1 0
73
VESS
ELS
IN O
PER
ATIO
N
46
Con
trac
ts a
nd
vess
els:
Ja
n 14
; Agr
eed
a co
ntra
ct fo
r the
Pla
t-fo
rm S
uppl
y ve
ssel
(“PS
V”) “
Siem
Atl
as”
for a
firm
per
iod
of tw
o ye
ars,
with
opt
ions
fo
r tw
o ye
ars
to b
e m
utua
lly a
gree
d, fo
r op
erat
ions
off
shor
e B
razi
l.
Jan
14; S
old
and
deliv
ered
the
2004
-bui
lt PS
V “S
iddi
s Sk
ippe
r”.
Feb
14; O
rder
ed tw
o w
ell-
inte
rven
tion
vess
els
sche
dule
d fo
r del
iver
y in
firs
t and
th
ird q
uart
er 2
016.
The
two
vess
els
shal
l be
bui
lt at
the
Flen
sbur
ger s
hipy
ard
in
Ger
man
y. B
oth
vess
els
shal
l be
char
tere
d to
Hel
ix E
nerg
y So
lutio
ns G
roup
for a
fir
m p
erio
d of
sev
en y
ears
with
opt
ions
th
at c
an e
xten
d th
e ch
arte
r per
iod
up to
tw
enty
-tw
o ye
ars.
Apr
14;
Sie
m O
ffsh
ore
Con
trac
tors
G
mbH
(“SO
C”)
, a w
holly
ow
ned
subs
idi-
ary
of S
iem
Off
shor
e In
c. w
as a
war
ded
a co
ntra
ct fo
r the
Nor
dsee
One
Off
shor
e W
ind
Farm
.
Apr
14;
Rec
eive
d de
liver
y of
the
inst
alla
-tio
n su
ppor
t ves
sel (
“ISV”
) “Si
em M
oxie
”. Th
e ve
ssel
sha
ll pr
imar
ily b
e ut
ilise
d by
SO
C fo
r pro
ject
wor
k w
ithin
the
subm
a-rin
e po
wer
cab
le in
stal
latio
n, re
pair
and
mai
nten
ance
seg
men
t.
May
14;
Agr
eed
a ch
arte
r agr
eem
ent f
or
the
Off
shor
e Su
bsea
Con
stru
ctio
n Ve
ssel
(“
OSC
V”) “
Siem
Stin
gray
”. Th
e ag
reem
ent
was
mad
e at
mar
ket t
erm
s an
d fo
r a fi
rm
perio
d of
thre
e ye
ars
with
two
year
ly
optio
ns. T
he c
hart
er c
omm
ence
d up
on
deliv
ery
of th
e ve
ssel
from
the
Nor
weg
ian
yard
.
May
14;
Sec
unda
Can
ada
LP, w
hich
is
50%
ow
ned
by S
iem
Off
shor
e, w
as
awar
ded
a fiv
e-ye
ar fi
rm c
ontr
act f
or o
ne
new
build
AH
TS v
esse
l. Th
e ve
ssel
sha
ll be
bui
lt at
the
Rem
onto
wa
ship
yard
and
be
del
iver
ed in
four
th q
uart
er 2
015.
May
14;
Rec
eive
d de
liver
y of
the
OSC
V “S
iem
Spe
arfis
h”.
Jun
14; E
xten
ded
firm
con
trac
t for
sci
en-
tific
core
-dril
ling
vess
el “J
oide
s Re
solu
-tio
n” b
y on
e ye
ar fo
llow
ing
the
char
tere
r’s
exer
cise
of t
he s
econ
d of
ten
annu
al
optio
ns.
Jun
14; R
ecei
ved
deliv
ery
of th
e PS
V “S
iem
Gia
nt”.
July
14;
Rec
eive
d de
liver
y of
the
OSC
V “S
iem
Stin
gray
”.
July
14;
Sol
d an
d de
liver
ed th
e 20
07-b
uilt
PSV
“Sie
m S
ailo
r”.
Aug
14;
Ent
ered
into
an
agre
emen
t with
D
aya
Mat
eria
ls B
hd. (
“Day
a”) i
n A
ugus
t 20
14 fo
r the
sal
e of
the
two
2013
-bui
lt
OSC
Vs “S
iem
Day
a 1”
and
“Sie
m D
aya
2”,
whi
ch a
re c
urre
ntly
cha
rter
ed b
y D
aya.
D
aya
has
been
giv
en 1
50 d
ays
from
A
ugus
t 201
4 to
arr
ange
for fi
nanc
ing
of
the
two
vess
els
and
deliv
ery
of th
e ve
s-se
ls is
sch
edul
ed to
take
pla
ce la
test
by
mid
-Apr
il 20
15. T
he e
n-bl
oc s
ales
pric
e is
U
SD 2
82 m
illio
n. T
he s
ale
wou
ld g
ener
ate
a ga
in, w
hich
will
be
reco
rded
at t
he d
eliv
-er
y of
the
vess
els.
The
sal
es p
roce
eds
will
be
use
d to
repa
y m
ortg
age
debt
.
Nov
14;
The
PSV
“Sie
m S
ymph
ony”
w
as d
eliv
ered
from
a N
orw
egia
n ya
rd in
N
ovem
ber a
nd c
omm
ence
d a
four
yea
r co
ntra
ct.
Dec
14;
The
OSR
V “S
iem
Mar
agog
i” w
as
deliv
ered
from
a B
razi
lian
yard
in O
ctob
er
and
com
men
ced
an e
ight
-yea
r con
trac
t in
Dec
embe
r.
Dec
14;
Agr
eed
a th
ree-
year
firm
con
trac
t fo
r the
OSC
V “S
iem
N-S
ea” (
ex. “
Siem
St
ork”
) with
com
men
cem
ent 1
Jan
uary
20
15.
Dec
14;
Rec
eive
d no
tices
of t
erm
inat
ion
from
Kar
mor
neft
egaz
SA
RL in
resp
ect
of th
e se
ason
al w
ork
in K
ara
Sea
for t
he
year
201
5 fo
r the
two
AH
TS v
esse
ls “S
iem
To
paz”
and
“Sie
m A
met
hyst
” and
for t
he
PSV
“Sie
m P
ilot”
.
Dec
14;
The
cha
rter
er d
ecla
red
thre
e m
onth
ext
ensi
on u
ntil
9 Ju
ne 2
015
for t
he
PSVs
“Sie
m H
anne
” and
“Sop
hie
Siem
”.
HIG
HLI
GH
TS 2
014
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
466
NE
W V
ESS
ELS
DE
LIVE
RE
D IN
201
4
Siem
Gia
nt
– bu
ilt b
y VA
RD N
iteró
i, Br
azil,
del
iver
ed 1
6 Ju
ne 2
014
Siem
Mar
agog
i –
built
by
ETP
Ship
yard
, Bra
zil,
deliv
ered
23
Oct
ober
201
4
Siem
Sym
phon
y –
built
by
Hel
lesø
y Ya
rd, N
orw
ay, d
eliv
ered
19
Nov
embe
r 201
4
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
47
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
47
Siem
Mox
ie
– bu
ilt b
y Fj
ells
tran
d, N
orw
ay,
deliv
ered
7 A
pril
2014
Siem
Spe
arfis
h –
built
by
VARD
Bra
ttva
ag, N
orw
ay,
deliv
ered
27
May
201
4
Siem
Sti
ngra
y –
built
by
VARD
Bra
ttva
ag, N
orw
ay, d
eliv
ered
24
July
201
4
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
48
NE
WB
UIL
DIN
GS
Siem
Pri
dede
liver
y 20
15
Siem
TB
Nde
liver
y 20
16
Siem
TB
Nde
liver
y 20
16
Siem
TB
Nde
liver
y 20
16
Des
ign:
VS
441
1 D
F
Type
:PS
V
An
exc
itin
g
ne
wb
uil
din
g
pro
gra
m
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
49
Siem
Mar
atai
zes
deliv
ery
2015
Des
ign:
U
LSTE
IN P
801
Type
:O
SRV
Siem
Aim
ery
deliv
ery
2016
Des
ign:
VA
RD C
LV 0
1
Type
:C
LV
Siem
Hel
ix 1
deliv
ery
2016
Siem
Hel
ix 2
deliv
ery
2016
Des
ign:
SALT
307
WIV
Type
:W
IV
TBN
deliv
ery
2015
Des
ign:
U
T 78
2Wp
Type
:A
HTS
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
41010
VES
SE
LS IN
OP
ER
AT
ION
MA
RC
H 2
015
Pla
tfo
rm S
up
ply
Ve
ss
els
(P
SV
)
Sie
m
Sy
mp
ho
ny
Sie
m A
tla
sS
iem
G
ian
tS
iem
Ha
nn
eS
iem
Lo
uis
aS
op
hie
Sie
m
Bu
ilt:
20
1420
1320
1420
0720
0620
06
De
sig
n:
VS 4
411
DF
STX
PSV
4700
STX
PSV
4700
VS 4
70 M
K II
VS 4
70 M
K II
VS 4
70 M
K II
Dp
Cla
ss
: 2
22
22
2
LO
A:
89.2
0 m
87.
90 m
87.9
0 m
73.4
0 m
73.4
0 m
73.4
0 m
Bre
ad
th:
19.0
0 m
19.0
0 m
19.0
0 m
16.6
0 m
16.6
0 m
16.6
0 m
Dra
ug
ht:
7.
40 m
6.6
0m6.
60 m
6.42
m6.
42 m
6.42
m
Dw
t:
5,50
0 t
470
0 T
4,70
0 T
3570
T35
70 T
3570
T
Ac
co
mm
od
ati
on
: 25
3434
3434
34
Ca
rgo
De
ck
Are
a:
980
m2
1000
m2
usa
ble
1000
m2
usa
ble
680
m2 u
sabl
e68
0 m
2 usa
ble
680
m2 u
sabl
e
Ow
ne
rsh
ip:
100%
100
%10
0%10
0%10
0%10
0%
Off
sh
ore
Su
bs
ea
Co
ns
tru
cti
on
Ve
ss
el
(OS
CV
) &
Mu
ltip
urp
os
e fi
eld
& R
OV
Su
pp
ort
Ve
ss
el
(MR
SV
)
An
ch
or
Ha
nd
lin
g T
ug
Su
pp
ly V
es
se
ls (
AH
TS
)
Sie
m M
arl
inS
iem
N-S
ea
S
iem
Da
ya
1
Sie
m D
aya
2S
iem
Sp
ea
rfis
hS
iem
Sti
ng
ray
Bu
ilt:
20
0920
0920
1320
1320
1420
14
De
sig
n:
MT
6017
MK
IIM
T 60
17 M
K II
STX
OSC
V 11
LST
X O
SCV
11L
STX
OSC
V 03
STX
OSC
V 03
Dp
Cla
ss
: 2
22
22
2
LO
A:
93.6
0 m
93.6
0 m
120.
80 m
120.
80 m
120.
80 m
120.
80 m
Bre
ad
th:
19.7
0 m
19.7
0 m
22.0
0 m
22.0
0 m
23.0
0 m
23.0
0 m
Dra
ug
ht:
6.
30 m
6.30
m6.
60 m
6.60
m6.
60 m
6.60
m
Dw
t:4.
500
t4.
500
t5.
000
t5.
000
t5.
000
t5.
000
t
Ac
co
mm
od
ati
on
: 68
6811
011
011
011
0
Ca
rgo
De
ck
Are
a:
1046
m2
1046
m2
1300
m2
1300
m2
1,30
0 m
21,
300
m2
Cra
ne
:10
0 t O
ffsh
ore/
Subs
ea c
rane
100
t Off
shor
e/Su
bsea
cra
ne25
0 t O
ffsh
ore/
Subs
ea c
rane
250
t Off
shor
e/Su
bsea
cra
ne1
X 25
0 t A
HC,
3,0
00 m
1 X
250
t AH
C, 3
,000
m
RO
V M
oo
np
oo
l-
-7.
2 X
7.2
7.2
X 7.
27.
2 X
7.2
m7.
2 X
7.2
m
Ow
ne
rsh
ip:
100%
100%
100%
100%
100%
100%
Sie
m A
me
thy
st
Sie
m O
pa
lS
iem
Ga
rne
tS
iem
Sa
pp
hir
eS
iem
Aq
ua
ma
rin
e
Bu
ilt:
20
1120
1120
1020
1020
10
De
sig
n:
VS 4
91 C
DVS
491
CD
VS 4
91 C
DVS
491
CD
VS 4
91 C
D
Dp
Cla
ss
: 2
22
22
LO
A:
91.0
0 m
91.0
0 m
91.0
0 m
91.0
0 m
91.0
0 m
Bre
ad
th:
22.0
0 m
22.0
0 m
22.0
0 m
22.0
0 m
22.0
0 m
Dra
ug
ht:
7.
95 m
7.95
m7.
95 m
7.95
m7.
95 m
Dw
t:
3800
T38
00 T
3800
T38
00 T
3800
T
Ac
co
mm
od
ati
on
: 60
6060
6060
Ca
rgo
De
ck
Are
a:
800
m2
800
m2
800
m2
800
m2
800
m2
BH
P:
2800
028
000
2800
028
000
2800
0
Bo
lla
rd P
ull
:29
7 Te
297
Te28
2 Te
301
Te28
4 Te
Ow
ne
rsh
ip:
100%
0%0%
100%
100%
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
41111
La
rge
-siz
e P
SV
s
Sie
m S
as
ha
Sid
dis
Ma
rin
er
Sie
m P
ilo
tH
ug
in E
xp
lore
rS
iem
Su
pp
lie
rS
iem
Ca
rrie
r
2005
2011
2010
2006
1999
1996
VS 4
70 M
K II
VS 4
85VS
485
MT
6000
MK
IIM
T 60
00VS
483
12
22
22
73.4
0 m
88.3
m88
.3 m
86.2
0 m
83.7
0 m
82.8
5 m
16.6
0 m
20 m
20 m
19.7
0 m
17.7
0 m
19.0
0 m
6.42
map
prox
7.0
map
prox
7.0
m6.
18 m
6.10
m6.
30 m
3570
T45
00 T
4500
T32
36 T
4250
T46
79 T
3464
6456
2023
680
m2 u
sabl
e97
0 m
297
0 m
293
5 m
291
2 m
284
0 m
2
100%
51%
51%
100%
100%
100%
Sie
m T
op
az
Sie
m R
ub
yS
iem
Dia
mo
nd
Sie
m P
ea
rlS
iem
Em
era
ld
2010
2010
2010
2009
2009
VS 4
91 C
DVS
490
CD
VS 4
91 C
DVS
491
CD
VS 4
91 C
D
22
22
2
91.0
0 m
91.0
0 m
91.0
0 m
91.0
0 m
91.0
0 m
22.0
0 m
22.0
0 m
22.0
0 m
22.0
0 m
22.0
0 m
7.95
m7.
95 m
7.95
m7.
95 m
7.95
m
3800
T38
00 T
3800
T38
00 T
3800
T
6060
6060
60
800
m2
800
m2
800
m2
800
m2
800
m2
2800
028
000
2800
028
000
2800
0
306
Te31
0 Te
284
Te28
5 Te
281
Te
100%
100%
100%
100%
100%
Oth
er
Bra
zil
31
.03
.20
15
Fle
et
of
9 v
es
se
ls
Ca
na
da
31
.03
.20
15
Fle
et
of
6 v
es
se
ls
JO
IDE
S R
ES
OL
UT
ION
BIG
OR
AN
GE
XV
III
OSR
V/FC
S/FS
VA
HTS
/PSV
/Fie
ld s
uppo
rtSc
ient
ific
Cor
e D
rillin
g Ve
s-
sel (
SCD
V)
Wel
l Stim
ulat
ion
Vess
el
(WSV
)
100%
ow
ned
50%
ow
ned
100%
ow
ned
41.3
% o
wne
d
Ins
tall
ati
on
Su
pp
ort
Ve
ss
el
(IS
V)
Sie
m M
ox
ie
Bu
ilt:
20
14
De
sig
n:
SX 1
63 X
-Bow
Dp
Cla
ss
: 2
LO
A:
74.0
0 m
Bre
ad
th:
17.0
0 m
Dra
ug
ht:
6.
40 m
Dw
t:2.
835
t
Ac
co
mm
od
ati
on
: 60
Ca
rgo
De
ck
Are
a:
200
m2 us
able
Ow
ne
rsh
ip:
100%
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
412
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
412
LOC
AL
PR
ESE
NC
E IN
KE
Y M
AR
KE
TS 3
1.03
.201
5
Ge
og
rap
ica
l
foo
tpri
nt
Kri
stia
nsan
d (H
Q)
Siem
Off
shor
e of
fices
:
• K
ristia
nsan
d (N
orw
ay)
• Ri
o de
Jan
eiro
, Mac
aé, A
raca
ju (B
razi
l)•
Leer
(Ger
man
y)•
Gro
ning
en (T
he N
ethe
rlan
ds)
• H
oust
on (U
SA)
• A
ccra
(Gha
na)
• Pe
rth
(Aus
tral
ia)
• G
dyni
a (P
olan
d)
Secu
nda
Can
ada
LP O
ffice
s(a
ssoc
iate
d co
mpa
ny):
• St
. Joh
n´s,
Hal
ifax
(Can
ada)
Leer
Gro
ning
en
Gdy
nia
St. J
ohn´
s
Hal
ifax
Hou
ston
Ara
caju
Mac
aé
Rio
de
Jane
iro
Acc
ra
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
413
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
413
Pert
h
TOTA
L EM
PLO
YEES
10
73
TOTA
L N
UM
BER
OF
VESS
ELS
55
VESS
ELS
IN O
PER
ATIO
N
46
P
SVs:
12
AH
TS:
10O
SCVs
: 6
CAN
AD
IAN
FLE
ET:
6O
THER
: 12
VESS
ELS
UN
DER
CO
NST
RU
CTI
ON 9
PSV
s: 4
AH
TS:
1W
IVs:
2O
THER
: 2
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
414
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
414
Siem
Off
shor
e ow
ns a
nd o
pera
tes
one
of th
e w
orld
’s m
ost
mod
ern
fleet
of o
ffsh
ore
supp
ort v
esse
ls, e
quip
ped
to m
eet
the
incr
ease
d re
quire
men
ts fr
om c
lient
s an
d de
man
ds fr
om
oper
atio
n in
the
hars
hest
env
ironm
ents
.
Siem
Off
shor
e ha
d 46
ves
sels
in
oper
atio
n an
d 9
vess
els
unde
r co
nstr
uctio
n by
yea
r-en
d 20
14.
Vess
els
in o
pera
tion
incl
uded
two
anch
or h
andl
ing,
tug,
sup
ply
vess
els
oper
-at
ed o
n be
half
of a
poo
l par
tner
. By
end
Mar
ch 2
015,
the
tota
l flee
t co
mpr
ised
of 5
5 ve
ssel
s, in
clud
ing,
am
ong
othe
rs th
e fo
llow
ing
owne
d ve
s-se
ls, s
ixte
en P
latf
orm
Sup
ply
Vess
els
(PSV
s),
six
Off
shor
e Su
bsea
Con
stru
ctio
n Ve
ssel
s (O
SCVs
), ei
ght A
ncho
r Han
dlin
g,
Tug,
Sup
ply
vess
els
(AH
TS v
esse
ls),
two
Wel
l-In
terv
entio
n Ve
ssel
s (W
IVs)
, one
TH
IS IS
SIE
M O
FFS
HO
RE
INC
.
Inst
alla
tion
Supp
ort V
esse
l (IS
V), o
ne
Cab
le L
ay V
esse
l (C
LV)
and
six
Can
adia
n fla
gged
ves
sels
com
pris
ing
of b
oth
AH
TS
vess
els
and
PSVs
. The
flee
t pro
vide
s a
broa
d sp
ectr
um o
f ser
vice
s of
fere
d by
a
high
ly e
xper
ienc
ed a
nd c
ompe
tent
cre
w
with
a s
tron
g fo
cus
on H
ealth
, Saf
ety,
En
viro
nmen
t and
Qua
lity.
The
Com
pany
’s v
isio
n is
to b
ecom
e th
e le
adin
g pr
ovid
er a
nd th
e m
ost a
ttra
ctiv
e em
ploy
er o
ffer
ing
mar
ine
serv
ices
to th
e of
fsho
re e
nerg
y se
rvic
e in
dust
ry. T
he
Com
pany
sha
ll de
liver
qua
lity
and
relia
ble
cont
ract
ed s
ervi
ces
in a
tim
ely
man
ner b
y
exec
utin
g co
st-e
ffici
ent s
olut
ions
dev
el-
oped
in a
ctiv
e co
llabo
ratio
n an
d co
oper
a-tio
n w
ith o
ur c
usto
mer
s.Si
em O
ffsh
ore
com
men
ced
oper
atio
ns
with
eff
ect f
rom
1 J
uly
2005
. Th
e C
om-
pany
is re
gist
ered
in th
e C
aym
an Is
land
s an
d is
list
ed o
n th
e O
slo
Stoc
k Ex
chan
ge
(OSE
Sym
bol:
SIO
FF).
The
Com
pany
’s
head
quar
ters
is lo
cate
d in
Kris
tians
and,
N
orw
ay a
nd a
dditi
onal
sub
sidi
ary
offic
es
are
loca
ted
in B
razi
l, G
erm
any,
the
Net
her-
land
s, G
hana
, USA
, Pol
and
and
Aus
tral
ia.
The
Com
pany
is ta
x re
side
nt in
Nor
way
.
Phot
ogra
pher
: Aril
d Li
llebø
, Si
em A
met
hyst
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
41515
We
cont
inuo
usly
wor
k to
mak
e th
e va
lues
par
t of t
he
daily
life
of t
he C
ompa
ny,
in p
artic
ular
in tr
aini
ng o
f
lead
ers
thro
ugho
ut th
e
orga
niza
tion.
The
val
ues
are
esta
blis
hed
to s
uppo
rt
our p
rese
nt a
nd fu
ture
busi
ness
.
Our
Va
lues
CA
RIN
GW
e en
cour
age
team
spi
rit a
nd k
now
ledg
e sh
arin
g. W
e st
rive
to p
erfo
rm o
ur d
aily
w
ork
corr
ectly
, saf
ely
and
with
out c
aus-
ing
dam
age
to p
eopl
e, e
nviro
nmen
t and
eq
uipm
ent.
CO
MP
ET
ITIV
EW
e be
have
in a
pro
-act
ive
man
ner a
nd
we
are
inno
vativ
e in
our
way
of t
hink
ing.
C
ontin
uous
impr
ovem
ent i
s ou
r key
to
succ
ess.
CO
MM
ITT
ED
We
are
driv
en b
y in
tegr
ity. W
e st
ep u
p an
d ta
ke c
harg
e to
fulfi
l giv
en p
rom
ises
.
2005
616
20 4
8020
0679
799
2007
87 7
3820
0857
934
2009
74 6
4120
10
122
952
2011
REV
ENU
E
OP
ERAT
ING
MA
RG
IN
2005
13 2
3373
554
2006
159
342
2007
192
773
2008
183
558
2009
228
302
340
628
2010
2011
2005
331
527
2006
600
2007
642
2008
762
2009
828
2010
1 07
320
11
EMP
LOYE
ES
Am
ou
nts
in U
SD
1,0
00
110
348
2012
368
213
2012
1 07
820
12
363
955
2013
122
663
2013
1 11
020
13
491
312
2014
194
125
2014
1 07
320
14
Am
ou
nts
in U
SD
1,0
00
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
416
The
Com
pany
All
refe
renc
es to
“Sie
m O
ffsh
ore”
and
the
“Com
pany
” sha
ll m
ean
Siem
Off
shor
e In
c.
and
its s
ubsi
diar
ies
and
asso
ciat
es u
n-le
ss th
e co
ntex
t ind
icat
es o
ther
wis
e. A
ll re
fere
nces
to “P
aren
t” s
hall
mea
n Si
em
Off
shor
e In
c. a
s th
e pa
rent
com
pany
onl
y.
Siem
Off
shor
e is
regi
ster
ed in
the
Cay
-m
an Is
land
s an
d is
list
ed o
n th
e O
slo
Stoc
k Ex
chan
ge (O
SE S
ymbo
l: SI
OFF
). Th
e C
ompa
ny’s
hea
dqua
rter
s is
loca
ted
in K
ristia
nsan
d, N
orw
ay a
nd a
dditi
onal
su
bsid
iary
offi
ces
are
loca
ted
in B
razi
l, G
erm
any,
the
Net
herl
ands
, Gha
na, U
SA,
Can
ada,
Cay
man
Isla
nds
and
Aus
tral
ia.
The
pare
nt c
ompa
ny is
tax
resi
dent
in
Nor
way
.
The
Com
pany
’s p
rimar
y ac
tivity
is to
ow
n an
d op
erat
e of
fsho
re s
uppo
rt v
esse
ls
(“O
SVs”
) for
the
offs
hore
ene
rgy
serv
ice
indu
stry
. The
Com
pany
is a
lso
enga
ged
as
a co
ntra
ctor
with
in th
e Eu
rope
an o
ffsh
ore
win
d fa
rm m
arke
t thr
ough
its
subs
idi-
ary,
Sie
m O
ffsh
ore
Con
trac
tors
with
a
prim
ary
focu
s on
inst
alla
tion,
pos
t-la
y tr
ench
ing,
term
inat
ion
and
test
ing
of
The
Boar
d of
Dire
ctor
s of
Sie
m O
ffsh
ore
Inc.
(the
“Boa
rd”)
pr
esen
ts it
s re
port
for t
he y
ear e
nded
31
Dec
embe
r 201
4 to
-ge
ther
with
the
audi
ted
cons
olid
ated
fina
ncia
l sta
tem
ents
and
th
e au
dite
d fin
anci
al s
tate
men
ts fo
r the
par
ent c
ompa
ny. T
he
finan
cial
sta
tem
ents
and
rela
ted
note
s w
ere
auth
oris
ed fo
r is
sue
by th
e B
oard
on
13 A
pril
2015
and
will
be
pres
ente
d to
th
e sh
areh
olde
rs fo
r app
rova
l at t
he A
nnua
l Gen
eral
Mee
ting
to b
e he
ld 1
May
201
5. subm
arin
e co
mpo
site
cab
les.
The
OSV
flee
t com
pris
es p
latf
orm
sup
ply
vess
els
(“PS
Vs”)
, anc
hor-
hand
ling,
tug,
su
pply
ves
sels
(“A
HTS
ves
sels
”), o
ffsh
ore
subs
ea c
onst
ruct
ion
vess
els
(“O
SCVs
”)
and
a va
riety
of o
ther
ser
vice
ves
sels
. The
C
ompa
ny h
ad o
wne
rshi
p in
44
vess
els
of w
hich
9 v
esse
ls w
ere
unde
r con
stru
c-tio
n at
yea
r-en
d 20
14. T
he C
ompa
ny a
lso
oper
ates
two
AH
TS v
esse
ls o
n be
half
of
a po
ol p
artn
er.
Thes
e tw
o A
HTS
ves
sels
ar
e si
ster
ves
sels
to e
ight
ves
sels
ow
ned
by th
e C
ompa
ny, a
nd a
ll te
n ve
ssel
s ar
e op
erat
ed in
a p
ool.
Dur
ing
2014
, the
tota
l fle
et o
f OSV
s co
nduc
ted
oper
atio
ns in
the
Nor
th S
ea, A
rctic
, Wes
t Afr
ica,
Mid
dle
East
, the
U.S
. Gul
f, C
anad
a an
d Br
azil.
The
Com
pany
hol
ds 5
0% o
wne
rshi
p in
th
e co
mpa
ny S
ecun
da H
oldi
ngs
Lim
ited.
Se
cund
a ow
ns a
nd o
pera
tes
a ha
rsh-
wea
ther
flee
t of s
ix o
ffsh
ore
supp
ort v
es-
sels
and
is a
lead
er in
sup
port
ser
vice
s fo
r pl
atfo
rm s
uppl
y, a
ncho
r han
dlin
g, re
scue
st
andb
y an
d to
wag
e in
its
prim
ary
area
of
ope
ratio
n ou
tsid
e th
e co
ast o
f Eas
tern
C
anad
a.
The
Com
pany
hol
ds a
60%
ow
ners
hip
in
the
subs
idia
ry S
iem
WIS
AS.
Sie
m W
IS
deve
lops
app
licat
ions
for m
anag
ed p
res-
sure
dril
ling
base
d on
a p
aten
ted
seal
ing
tech
nolo
gy.
The
Com
pany
hol
ds 1
00%
ow
ners
hip
in
Ove
rsea
s D
rillin
g Li
mite
d (“
OD
L”),
whi
ch
owns
the
scie
ntifi
c oc
ean
drill
ship
JO
IDES
Re
solu
tion.
The
JO
IDES
Res
olut
ion
is o
ne
of th
e pr
imar
y re
sear
ch v
esse
ls u
sed
to
drill
cor
e sa
mpl
es in
the
ocea
n flo
or fo
r an
inte
rnat
iona
l res
earc
h pr
ogra
m.
In a
dditi
on to
the
owne
rshi
p an
d op
era-
tions
of O
SVs,
the
Com
pany
’s w
holly
-ow
ned
Braz
ilian
sub
sidi
ary,
Sie
m O
ffsh
ore
do B
rasi
l S.A
., pr
ovid
es s
peci
aliz
ed
engi
neer
ing
to d
evel
op a
nd im
plem
ent
com
bat m
anag
emen
t sys
tem
s fo
r ves
sels
in
the
Braz
ilian
nav
y. T
hese
act
iviti
es w
ere
part
of S
iem
Off
shor
e do
Bra
sil w
hen
it w
as in
itial
ly a
cqui
red
by th
e C
ompa
ny.
Fina
ncia
l res
ults
, Pos
itio
n an
dR
isks
IFR
S
The
finan
cial
sta
tem
ents
for t
he C
ompa
ny
and
the
Pare
nt a
re p
repa
red
in a
ccor
d-
TH
E B
OA
RD
OF
DIR
ECTO
RS
RE
PO
RT
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
417
ance
with
the
Inte
rnat
iona
l Fin
anci
al
Repo
rtin
g St
anda
rds
(“IF
RS”)
as
adop
ted
by th
e Eu
rope
an U
nion
.
Goi
ng-C
once
rnTh
e fin
anci
al s
tate
men
ts h
ave
been
pr
epar
ed u
nder
the
assu
mpt
ion
that
the
Com
pany
and
the
Pare
nt a
re g
oing
-con
-ce
rns.
Thi
s as
sum
ptio
n is
bas
ed o
n th
e C
ompa
ny’s
leve
l of c
ash
and
cash
equ
iva-
lent
s at
yea
r-en
d, fo
reca
sted
cas
h-flo
ws,
av
aila
ble
cred
it fa
cilit
ies
and
the
mar
ket
valu
e of
its
asse
ts.
Inco
me
Stat
emen
tTh
e C
ompa
ny h
ad 4
6 of
fsho
re v
esse
ls
in o
pera
tion
at y
ear-
end,
incl
udin
g tw
o A
HTS
ves
sels
ow
ned
by th
e C
ompa
ny’s
po
ol p
artn
er. T
he C
ompa
ny h
ad 9
ves
sels
un
der c
onst
ruct
ion
at th
e en
d of
201
4, o
f w
hich
six
ves
sels
wer
e un
der c
onst
ruc-
tion
in P
olan
d, tw
o in
Ger
man
y an
d on
e in
Bra
zil.
Thes
e 9
vess
els
incl
ude
one
oil
spill
reco
very
ves
sel (
“OSR
V”) s
ched
uled
fo
r del
iver
y in
201
5, fo
ur d
ual-
fuel
PSV
s w
ith o
ne fo
r del
iver
y in
201
5 an
d th
ree
in 2
016,
one
Cab
le-L
ay V
esse
l (“C
LV”)
fo
r del
iver
y in
201
6, o
ne A
HTS
ves
sel f
or
deliv
ery
in 2
015
and
two
Wel
l-In
terv
en-
tion
Vess
els
(“W
IVs”
) for
del
iver
y in
201
6.
The
Com
pany
has
sol
d tw
o PS
Vs d
urin
g 20
14 a
nd ta
ken
deliv
ery
of tw
o la
rge
OSC
Vs, o
ne P
SV, o
ne In
stal
latio
n Su
ppor
t Ve
ssel
(“IS
V”) a
nd o
ne O
SRV.
All
vess
els
deliv
ered
dur
ing
2014
hav
e co
mm
ence
d lo
ng-t
erm
con
trac
ts, w
ith th
e IS
V be
ing
utili
zed
by th
e su
bsid
iary
, Sie
m O
ffsh
ore
Con
trac
tors
.
In 2
014,
the
Com
pany
reco
rded
ope
rat-
ing
reve
nue
of U
SD 4
91.3
mill
ion
and
a ne
t pro
fit a
ttrib
utab
le to
sha
reho
lder
s of
U
SD 5
8.2
mill
ion,
or U
SD 0
.15
per s
hare
, co
mpa
red
to o
pera
ting
reve
nue
of U
SD
364.
0 m
illio
n an
d a
net p
rofit
att
ribut
able
to
sha
reho
lder
s of
USD
22.
0 m
illio
n, o
r U
SD 0
.06
per s
hare
, in
2013
.
The
Com
pany
’s o
pera
ting
mar
gin
for
2014
was
USD
194
.1 m
illio
n co
mpa
red
to
USD
122
.7 m
illio
n in
201
3. N
et o
pera
t-in
g m
argi
n as
a p
erce
ntag
e of
ope
ratin
g
reve
nue
was
40%
in 2
014
com
pare
d to
34
% in
201
3.
The
Com
pany
’s o
pera
ting
profi
t for
20
14 w
as U
SD 8
4.3
mill
ion
com
pare
d to
U
SD 6
9.3
mill
ion
in 2
013
and
incl
udes
de
prec
iatio
n an
d am
ortis
atio
n of
USD
96
.9 m
illio
n (2
013:
USD
75.
8 m
illio
n).
The
Com
pany
has
con
duct
ed a
revi
ew
of v
esse
l val
uatio
ns a
nd h
as re
cord
ed
impa
irmen
ts o
f USD
29
mill
ion
on c
erta
in
Braz
ilian
-bui
lt ve
ssel
s. N
et c
urre
ncy
exch
ange
(los
ses)
of U
SD (3
.0) m
illio
n (2
013:
USD
(7.8
) mill
ion)
wer
e re
cord
ed
on c
urre
ncy
deriv
ativ
e co
ntra
cts,
of w
hich
U
SD 5
.6 m
illio
n w
as u
nrea
lised
. The
net
ga
in o
n sa
le o
f ass
et w
as U
SD 1
8.7
mil-
lion
(201
3: U
SD 2
9.8
mill
ion)
.
The
Com
pany
’s n
et fi
nanc
ial i
tem
s w
ere
net e
xpen
ses
of U
SD (1
2.7)
mill
ion
(201
3:
USD
(53.
4) m
illio
n) a
nd in
clud
es a
reva
lu-
atio
n ga
in (l
oss)
of n
on-U
SD c
urre
ncy
item
s of
USD
34.
1 m
illio
n (2
013:
USD
(2
2.7)
mill
ion)
due
to s
tron
ger U
SD d
ur-
ing
the
perio
d. N
on-U
SD c
urre
ncy
item
s ar
e he
ld to
mat
ch s
hort
- and
long
-ter
m
liabi
litie
s, in
clud
ing
off-
bala
nce
shee
t lia
bilit
ies,
in s
imila
r cur
renc
y.
The
Com
pany
’s n
et p
rofit
att
ribut
able
to
shar
ehol
ders
was
USD
58.
1 m
illio
n or
U
SD 0
.15
per s
hare
(201
3: U
SD 2
2.0
mil-
lion,
or U
SD 0
.06
per s
hare
).
The
Pare
nt c
ompa
ny is
prim
arily
a h
old-
ing
com
pany
ow
ing
shar
es in
ope
ratin
g su
bsid
iarie
s. T
he P
aren
t Com
pany
mad
e an
acc
umul
ated
writ
e-do
wn
of U
SD 4
9 m
illio
n on
the
shar
es in
the
Braz
ilian
su
bsid
iary
and
the
subs
idia
ry o
wni
ng th
e sc
ient
ific
core
dril
ling
vess
el.
The
Boa
rd p
ropo
ses
that
the
net l
oss
of
the
Pare
nt o
f USD
(64.
5) m
illio
n fo
r 201
4 be
allo
cate
d to
reta
ined
ear
ning
s an
d th
at
no d
ivid
end
to b
e pa
id fo
r 201
4. A
s of
31
Dec
embe
r 201
4, th
e re
tain
ed e
arni
ngs
wer
e U
SD 2
58.7
mill
ion.
Fina
ncia
l Pos
ition
and
Cas
h-Fl
ows
Tota
l equ
ity fo
r the
Com
pany
was
USD
82
4 m
illio
n at
yea
r-en
d 20
14 (2
013:
USD
79
4 m
illio
n), a
nd th
e eq
uity
ratio
was
36
% (2
013:
42%
). Sh
areh
olde
rs’ e
quity
w
as U
SD 7
85 m
illio
n (2
013:
757
mill
ion)
, eq
uiva
lent
to U
SD 2
.03
per s
hare
(201
3:
USD
1.9
8 pe
r sha
re).
The
cash
pos
ition
at y
ear-
end
was
USD
11
8 m
illio
n (2
013:
USD
101
mill
ion)
.
The
Com
pany
reco
rded
USD
526
mill
ion
as g
ross
cap
ital e
xpen
ditu
res
in fi
xed
as-
sets
dur
ing
2014
, of w
hich
USD
497
mil-
lion
rela
tes
to n
ew v
esse
ls d
eliv
ered
from
ya
rds
or v
esse
ls u
nder
con
stru
ctio
n, a
nd
USD
29
mill
ion
rela
tes
to p
roje
ct s
peci
fic
inve
stm
ents
in v
esse
ls a
nd c
apita
lised
dr
y-do
ckin
gs.
The
Com
pany
had
sec
ured
deb
t-fin
anci
ng
for e
ight
of t
he n
ine
vess
els
unde
r con
-st
ruct
ion
at y
ear e
nd. T
he d
ebt fi
nanc
ing
for t
he A
HTS
ves
sel,
to b
e ow
ned
by th
e 50
% o
wne
d co
mpa
ny S
ecun
da, h
as b
een
agre
ed in
Apr
il 20
15.
The
gros
s in
tere
st-b
earin
g de
bt a
nd n
et
inte
rest
-bea
ring
debt
at y
ear-
end
wer
e eq
uiva
lent
to U
SD 1
.2 b
illio
n an
d U
SD 1
.1
billi
on, r
espe
ctiv
ely.
The
Com
pany
mad
e to
tal d
raw
ings
in th
e eq
uiva
lent
of U
SD
448
mill
ion
unde
r cre
dit f
acili
ties
durin
g th
e ye
ar. T
he w
eigh
ted
aver
age
cost
of
debt
for t
he C
ompa
ny w
as a
ppro
xim
atel
y 4.
5% p
.a. a
t yea
r-en
d.
The
Com
pany
pai
d de
bt in
stal
men
ts in
th
e eq
uiva
lent
of U
SD 1
32 m
illio
n du
ring
the
year
, of w
hich
USD
35
mill
ion
repr
e-se
nts
extr
aord
inar
y re
paym
ents
due
to
sale
s of
ves
sels
.
The
gros
s pr
ojec
t cos
t for
the
rem
aini
ng
new
build
ing
prog
ram
was
USD
550
mil-
lion
at y
ear-
end
2014
. App
roxi
mat
ely
USD
24
2 m
illio
n of
suc
h fu
ture
yar
d in
stal
-m
ents
are
sch
edul
ed fo
r pay
men
t dur
ing
2015
and
USD
308
mill
ion
are
sche
dule
d fo
r pay
men
t in
2016
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
418
BO
AR
D O
F D
IREC
TOR
S’ R
EP
OR
T
The
Com
pany
’s c
ash-
flow
s ar
e pr
imar
-ily
den
omin
ated
in U
SD, N
OK
, EU
R an
d BR
L. D
urin
g 20
14, t
he U
SD s
tren
gthe
ned
by 2
2.2%
to th
e N
OK
, 12.
1% to
the
BRL
and
11.8
% to
EU
R. T
he a
vera
ge re
cord
ed
exch
ange
rate
s w
ere
NO
K/U
SD 0
.157
5,
EUR/
USD
1.3
256
and
BRL/
USD
0.4
240
(201
3: N
OK
/USD
0.1
700,
EU
R/U
SD
1.33
00 a
nd B
RL/U
SD 0
.462
0).
The
Com
pany
is e
xpos
ed to
cha
nges
in in
-te
rest
rate
s as
app
roxi
mat
ely
32%
of t
he
inte
rest
-bea
ring
debt
is b
ased
on
float
ing
inte
rest
rate
s an
d pr
imar
ily d
enom
inat
ed
in U
SD a
nd N
OK
. Th
e av
erag
e 3-
mon
th
USD
LIB
OR
was
0.2
337%
p.a
. dur
ing
2014
(0
.267
2% p
.a. i
n 20
13) a
nd th
e av
erag
e 3-
mon
th N
IBO
R w
as 1
.70%
p.a
. dur
ing
2014
(1.7
5% p
.a. i
n 20
13).
The
Com
pany
he
ld U
SD 2
70 m
illio
n in
inte
rest
rate
sw
ap a
gree
men
ts a
t yea
r-en
d.
Fina
ncia
l Ris
ks
Inte
rest
risk
The
Com
pany
is e
xpos
ed to
cha
nges
in
inte
rest
rate
s as
app
roxi
mat
ely
32%
of
the
long
-ter
m in
tere
st b
earin
g de
bt w
as
subj
ect t
o flo
atin
g in
tere
st ra
tes
at y
ear-
end
2014
. Th
e re
mai
ning
par
t of t
he d
ebt
is s
ubje
ct to
fixe
d in
tere
st ra
tes.
Cur
renc
y ris
kTh
e C
ompa
ny is
exp
osed
to c
urre
ncy
risk
as re
venu
e an
d co
sts
are
deno
min
ated
in
var
ious
cur
renc
ies.
The
Com
pany
is
als
o ex
pose
d to
cur
renc
y ris
k du
e to
fu
ture
yar
d in
stal
men
ts in
rela
tion
to
ship
build
ing
cont
ract
s an
d lo
ng-t
erm
deb
t in
var
ious
cur
renc
ies.
For
war
d ex
chan
ge
cont
ract
s ar
e en
tere
d in
to in
ord
er to
re
duce
the
curr
ency
risk
rela
ted
to fu
ture
ca
sh fl
ows.
Liqu
idity
risk
The
Com
pany
is fi
nanc
ed b
y a
com
bina
-tio
n of
deb
t and
equ
ity. I
f the
Com
pany
fa
ils to
repa
y or
refin
ance
its
cred
it fa
cili-
ties,
add
ition
al e
quity
fina
ncin
g m
ay b
e re
quire
d. T
here
can
be
no a
ssur
ance
th
at th
e C
ompa
ny w
ill b
e ab
le to
repa
y its
deb
ts o
r ext
end
the
debt
repa
ymen
t
sche
dule
thro
ugh
re-fi
nanc
ing
of c
redi
t fa
cilit
ies.
The
re is
no
assu
ranc
e th
at th
e C
ompa
ny w
ill n
ot e
xper
ienc
e ca
sh fl
ow
shor
tfal
ls e
xcee
ding
the
Com
pany
’s
avai
labl
e fu
ndin
g so
urce
s or
to re
mai
n in
co
mpl
ianc
e w
ith m
inim
um c
ash
requ
ire-
men
ts o
r oth
er c
oven
ants
. Fu
rthe
r, th
ere
is n
o as
sura
nce
that
the
Com
pany
will
be
abl
e to
rais
e ne
w e
quity
or a
rran
ge
new
cre
dit f
acili
ties
on fa
vour
able
term
s an
d in
am
ount
s ne
cess
ary
to c
ondu
ct it
s on
goin
g an
d fu
ture
ope
ratio
ns s
houl
d th
is
be re
quire
d.
Yard
risk
The
proc
ess
for c
onst
ruct
ion
of n
ew v
es-
sels
is a
ssoc
iate
d w
ith n
umer
ous
risks
. A
mon
g th
e m
ost c
ritic
al ri
sk fa
ctor
s in
re
latio
n to
suc
h co
nstr
uctio
n is
the
risk
of n
ot re
ceiv
ing
the
vess
els
on ti
me,
at
budg
et a
nd w
ith a
gree
d sp
ecifi
catio
ns. I
n ad
ditio
n, th
ere
is th
e ris
k of
yar
ds e
xpe-
rienc
ing
finan
cial
or o
pera
tiona
l diffi
cul-
ties
resu
lting
in b
ankr
uptc
y or
oth
erw
ise
adve
rsel
y af
fect
ing
the
cons
truc
tion
proc
ess.
The
Com
pany
has
obt
aine
d ce
rtai
n gu
aran
tees
of fi
nanc
ial c
ompe
n-sa
tion
incl
udin
g re
fund
gua
rant
ees
for
vess
el u
nder
con
stru
ctio
n in
Pol
and
in
case
of d
elay
s an
d no
n-de
liver
y. F
urth
er,
the
Com
pany
has
the
right
to c
ance
l co
ntra
cts
if de
liver
y of
ves
sels
is s
igni
fi-ca
ntly
del
ayed
. How
ever
, no
assu
ranc
e ca
n be
giv
en th
at a
ll ris
ks h
ave
been
fully
co
vere
d.
Ope
rati
ons
Flee
t, Pe
rfor
man
ce a
nd E
mpl
oym
ent
The
fleet
in o
pera
tion
incl
uded
twel
ve
PSVs
, six
OSC
Vs, t
en A
HTS
ves
sels
of
whi
ch tw
o ar
e ow
ned
by a
poo
l-pa
rtne
r, si
x of
fsho
re s
uppo
rt v
esse
ls in
Can
ada,
a
fleet
of n
ine
crew
/sup
ply
boat
s op
erat
ed
in B
razi
l, on
e w
ell-
stim
ulat
ion
vess
el,
one
inst
alla
tion
supp
ort v
esse
l and
one
sc
ient
ific
core
dril
ling
vess
el.
The
PSV
fleet
ear
ned
oper
atin
g re
v-en
ues
of U
SD 1
04.4
mill
ion
and
had
94%
util
isat
ion
(201
3: U
SD 9
4.6
mill
ion
and
83%
). Th
e op
erat
ing
mar
gin
befo
re
adm
inis
trat
ive
expe
nses
was
USD
58.
9 m
illio
n (2
013:
USD
42.
9 m
illio
n) a
nd th
e op
erat
ing
mar
gin
as a
per
cent
age
of re
v-en
ue w
as 5
6% (2
013:
45%
). Th
e co
ntra
ct
back
log
at 3
1 D
ecem
ber 2
014
was
58%
fo
r 201
5, 4
2% fo
r 201
6 an
d 25
% fo
r 201
7.
The
OSC
V fle
et e
arne
d op
erat
ing
rev-
enue
s of
USD
104
.8 m
illio
n an
d ha
d 98
%
utili
satio
n (2
013:
USD
41.
4 m
illio
n an
d 10
0%).
The
ope
ratin
g m
argi
n be
fore
ad
min
istr
ativ
e ex
pens
es w
as U
SD 7
1.2
mill
ion
(201
3: U
SD 2
6.9
mill
ion)
and
the
oper
atin
g m
argi
n as
a p
erce
ntag
e of
rev-
enue
was
68%
(201
3: 6
5%).
The
cont
ract
ba
cklo
g w
as 8
8% fo
r 201
5, 8
3% fo
r 201
6 an
d 77
% fo
r 201
7.
The
eigh
t AH
TS v
esse
ls o
wne
d by
the
Com
pany
ear
ned
oper
atin
g re
venu
es o
f U
SD 1
42.5
mill
ion
and
had
84%
util
isat
ion
(201
3: U
SD 1
31.9
and
86%
util
izat
ion)
. Th
e op
erat
ing
mar
gin
befo
re a
dmin
istr
a-tiv
e ex
pens
es w
as U
SD 7
7.5
mill
ion
(201
3:
USD
67.
9 m
illio
n) a
nd th
e op
erat
ing
mar
-gi
n as
a p
erce
ntag
e of
reve
nue
was
54%
(2
013:
51%
). Th
e co
ntra
ct b
ackl
og w
as
15%
for 2
015
and
5% fo
r 201
6.
The
fleet
of s
mal
ler B
razi
lian-
flagg
ed
vess
els
earn
ed o
pera
ting
reve
nue
of
USD
19.
4 m
illio
n an
d ha
d 91
% u
tilis
atio
n (2
013:
USD
24.
1 m
illio
n an
d 92
%).
The
op
erat
ing
mar
gin
befo
re a
dmin
istr
ativ
e ex
pens
es w
as U
SD (3
.5) m
illio
n (2
013:
U
SD 6
.7 m
illio
n) a
nd th
e op
erat
ing
mar
gin
as a
per
cent
age
of re
venu
e w
as (1
8)%
(2
013:
28%
). Th
e co
ntra
ct b
ackl
og w
as
91%
for 2
015,
89%
for 2
016
and
89%
for
2017
.
The
“Joi
des
Reso
lutio
n” re
cord
ed o
pera
t-in
g re
venu
es o
f USD
25.
9 m
illio
n (2
013:
U
SD 3
6.9
mill
ion)
with
an
oper
atin
g m
argi
n be
fore
adm
inis
trat
ive
expe
nses
of
USD
12.
9 m
illio
n (2
013:
USD
20.
4 m
illio
n)
and
the
oper
atin
g m
argi
n as
a p
erce
ntag
e of
reve
nue
was
50%
(201
3: 5
5%).
Siem
Off
shor
e C
ontr
acto
rs re
cord
ed
oper
atin
g re
venu
es o
f USD
101
.5 m
illio
n.
The
proj
ects
with
in S
OC
are
acc
ount
ed
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
419
for u
sing
the
perc
enta
ge-o
f-co
mpl
etio
n m
etho
d. T
otal
pro
ject
mar
gin
befo
re a
d-m
inis
trat
ive
expe
nse
of U
SD 1
7.1
mill
ion
was
reco
gniz
ed o
n pr
ojec
ts d
urin
g 20
14.
Subj
ect t
o a
fore
cast
ed p
ositi
ve m
argi
n,
proj
ect r
even
ues
are
reco
rded
at a
sim
ilar
figur
e as
pro
ject
cos
ts u
ntil
the
proj
ect
has
reac
hed
min
imum
25%
com
ple-
tion.
Thi
s ha
s an
impa
ct o
n th
e ov
eral
l pe
rcen
tage
of o
pera
ting
mar
gin
for S
iem
O
ffsh
ore
on a
con
solid
ated
bas
is.
The
tota
l con
trac
t bac
klog
of fi
rm
cont
ract
s fo
r all
vess
els
at 3
1 D
ecem
ber
2014
was
USD
1.5
5 bi
llion
(201
3: U
SD
1.15
bill
ion)
, inc
ludi
ng th
e fir
m c
on-
trac
t for
the
“JO
IDES
Res
olut
ion”
, the
41
%-o
wne
rshi
p in
the
“Big
Ora
nge
XVIII
”, th
e 50
% o
wne
rshi
p in
Sec
unda
and
ves
-se
ls u
nder
con
stru
ctio
n.
The
tota
l con
trac
t bac
klog
is a
lloca
ted
w
ith U
SD 2
76 m
illio
n in
201
5, U
SD 2
03
mill
ion
in 2
016
and
USD
1.0
7 bi
llion
in
2017
and
ther
eaft
er.
The
tota
l con
trac
t bac
klog
of fi
rm c
on-
trac
ts fo
r Sie
m O
ffsh
ore
Con
trac
tors
at
31 D
ecem
ber 2
014
was
USD
118
mill
ion
(201
3: U
SD 1
73 m
illio
n). T
he c
ontr
act
back
log
is a
lloca
ted
with
USD
92
mill
ion
in 2
015
and
USD
26
mill
ion
in 2
016.
The
co
ntra
ct b
ackl
og a
t yea
r-en
d 20
14 d
oes
not i
nclu
de th
e co
ntra
ct v
alue
of a
p-pr
oxim
atel
y U
SD 7
0 m
illio
n fo
r Nor
dsee
O
ne O
WF
Inne
r Arr
ay G
rid S
yste
m p
roje
ct,
whi
ch re
ache
d its
fina
l inv
estm
ent d
eci-
sion
in M
arch
201
5, n
or th
e Ve
ja M
ate
OW
F In
ner A
rray
Grid
Sys
tem
pro
ject
in
exce
ss o
f USD
100
mill
ion
in c
ontr
act
valu
e aw
arde
d in
Apr
il 20
15.
QH
SE
The
Com
pany
’s ta
rget
incl
udes
zer
o pe
rson
al in
jurie
s, n
o da
mag
e to
the
envi
ronm
ent a
nd n
o da
mag
e to
or l
oss
of
equi
pmen
t and
pro
pert
y.Th
e go
od Q
HSE
per
form
ance
con
tinue
d in
20
14 w
ith n
o se
rious
inci
dent
s th
roug
hout
th
e fle
et. T
he s
afet
y re
cord
s fo
r the
full
year
repo
rt n
o se
rious
inju
ry to
per
sonn
el
or d
isch
arge
s to
the
envi
ronm
ent.
By
natu
re, a
ncho
r-ha
ndlin
g is
one
of
the
mos
t dem
andi
ng o
pera
tions
in th
e of
fsho
re s
ecto
r. Si
em O
ffsh
ore
puts
gre
at
emph
asis
on
a sa
fe w
ork
envi
ronm
ent
and
appr
opria
te ti
me
for a
dequ
ate
prep
a-ra
tions
for e
very
job
oper
atio
n.
An
incr
ease
is s
een
in n
umbe
r of s
afet
y re
port
s an
d th
e ex
perie
nce
feed
back
to
the
fleet
is a
wel
com
ed e
lem
ent t
o im
prov
e an
d en
sure
out
stan
ding
QH
SE
perf
orm
ance
. O
n bo
ard
and
asho
re w
e be
lieve
that
the
tran
sfer
of e
xper
ienc
e is
an
impo
rtan
t fac
tor t
o cr
eate
a p
rofe
s-si
onal
QH
SE c
ultu
re a
nd c
ontin
uous
ly
impr
ove
our Q
HSE
per
form
ance
.
Siem
WIS
Siem
WIS
has
des
igne
d an
d de
velo
ped
a pr
essu
re c
ontr
ol d
evic
e (“
PCD
”) w
hich
ca
n im
prov
e m
anag
ed p
ress
ure
drill
-in
g (“
MPD
”) o
pera
tions
. Glo
bal e
nerg
y de
man
d gr
owth
, com
bine
d w
ith th
e ne
ed
for i
ncre
ased
oil
reco
very
and
incr
ease
d nu
mbe
r of d
eep
sea
and
high
pre
ssur
e hi
gh te
mpe
ratu
re (“
HPH
T”) r
eser
voirs
, an
d gr
eate
r em
phas
is o
n sa
fety
man
age-
men
t will
lead
to in
crea
sed
dem
and
for
MPD
ser
vice
s.
The
MPD
ope
ratio
ns o
n th
e Ro
meo
wel
l co
mm
ence
d la
te O
ctob
er a
nd w
ere
com
plet
ed m
id-J
anua
ry 2
015.
The
MPD
op
erat
ion
was
suc
cess
ful a
nd th
e PC
D
syst
em is
tem
pora
rily
dem
obili
zed
due
to ri
g m
ove
and
will
be
mob
ilize
d fo
r the
Ju
lius
wel
l in
Apr
il 20
15.
The
Gud
run
proj
ect h
as b
een
post
pone
d se
vera
l tim
es, b
ut c
omm
ence
d dr
illin
g in
Feb
ruar
y 20
15.
The
proj
ect m
ight
be
com
plet
ed w
ithou
t the
requ
irem
ent o
f M
PD s
ervi
ces.
The
Vale
mon
pro
ject
has
con
clud
ed th
e re
quire
men
t for
MPD
and
mob
iliza
tion
is e
stim
ated
to c
omm
ence
in S
epte
m-
ber 2
015.
Sie
m O
ffsh
ore’
s ac
cum
ulat
ed
inve
stm
ent i
n Si
em W
IS to
tals
USD
15.6
mill
ion,
whe
reof
USD
8.8
mill
ion
is re
cord
ed a
s in
tang
ible
ass
ets
in th
e co
nsol
idat
ed a
ccou
nts.
Siem
Off
shor
e C
ontr
acto
rs
Gen
eral
Siem
Off
shor
e C
ontr
acto
rs (“
SOC
”) c
om-
men
ced
the
offs
hore
exe
cutio
n du
ring
seco
nd a
nd th
ird q
uart
er 2
014
on tw
o of
its
first
pro
ject
s w
ithin
the
Euro
pean
of
fsho
re w
ind
farm
mar
ket.
The
prim
ary
activ
ities
for S
OC
incl
ude
the
inst
alla
-tio
n, p
ost-
lay
tren
chin
g, te
rmin
atio
n an
d te
stin
g of
sub
mar
ine
com
posi
te c
able
s fo
rmin
g th
e in
ner a
rray
grid
of a
n of
fsho
re
win
d fa
rm (“
OW
F”).
SOC
has
bee
n te
chni
-ca
lly s
ucce
ssfu
l in
exec
utin
g its
pla
nned
w
ork
scop
e by
util
isin
g its
flee
t of l
arge
an
d hi
gh q
ualit
y D
P-2
inst
alla
tion
ves-
sels
, in
com
bina
tion
with
its
expe
rienc
ed
offs
hore
and
ons
hore
org
anis
atio
ns.
Safe
ty &
Env
ironm
ent
Hig
h sa
fety
and
env
ironm
enta
l sta
ndar
ds
have
bee
n a
first
prio
rity
with
in S
OC.
Ris
k as
sess
men
t pro
cess
es a
nd p
erso
nnel
tr
aini
ng e
nsur
es th
at in
tern
al p
erso
n-ne
l and
sub
cont
ract
ors
have
a c
omm
on
safe
ty fi
rst m
enta
lity,
whi
ch h
as d
eliv
ered
ze
ro lo
ss ti
me
inju
ries
this
yea
r. En
viro
n-m
enta
l im
pact
is a
key
are
a of
impo
r-ta
nce
in a
mar
ket f
ocus
sed
on re
new
able
en
ergy
. SO
C h
as d
evel
oped
sta
ndar
ds to
re
port
and
ana
lyse
the
impa
ct o
f cab
le
inst
alla
tion
activ
ities
on
the
envi
ronm
ent.
Posi
tive
feed
back
from
clie
nts
on s
afet
y pl
anni
ng a
nd e
xecu
tion
dem
onst
rate
s st
reng
th in
this
are
a.
Proj
ects
The
Am
rum
bank
Wes
t OW
F pr
ojec
t for
E.
ON
Kra
ftw
erke
Gm
bH in
volv
es th
e in
stal
latio
n, p
ost-
lay
tren
chin
g, te
rmin
a-tio
n an
d te
stin
g of
86
inne
r arr
ay g
rid
subm
arin
e co
mpo
site
cab
les
with
in th
e G
erm
an B
ight
sec
tor o
f the
Nor
th S
ea.
The
inst
alla
tion
of th
e ca
bles
was
spl
it in
tw
o ca
mpa
igns
. By
year
-end
, 53
of th
e 86
ca
bles
wer
e in
stal
led.
All
of th
e ca
bles
ar
e no
w in
stal
led
and
the
proj
ect i
s sc
hedu
led
to b
e co
mpl
eted
with
in s
econ
d
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
420
BO
AR
D O
F D
IREC
TOR
S’ R
EP
OR
T
quar
ter 2
015
with
a p
ositi
ve m
argi
n.
Dur
ing
a pe
riod
of a
vaila
bilit
y in
bet
wee
n th
e tw
o ca
mpa
igns
for t
he A
mru
mba
nk
Wes
t OW
F pr
ojec
t, SO
C p
erfo
rmed
cab
le
inst
alla
tion
wor
ks fo
r E.O
N C
limat
e &
Re-
new
able
s U
K L
td. T
he p
roje
ct in
volv
ed th
e su
cces
sful
inst
alla
tion
of 2
4 in
ner a
rray
gr
id s
ubm
arin
e co
mpo
site
cab
les
for t
he
clie
nt in
a tw
o m
onth
per
iod
in c
halle
ngin
g en
viro
nmen
tal c
ondi
tions
on
the
Hum
ber
Gat
eway
OW
F in
the
Uni
ted
Kin
gdom
Sec
-to
r of t
he N
orth
Sea
. The
pro
ject
pro
duce
d op
erat
ing
reve
nues
of a
ppro
xim
atel
y EU
R 7
mill
ion
and
with
a p
ositi
ve m
argi
n.
The
Balti
c 2
OW
F pr
ojec
t for
EnB
W B
altic
2
Gm
bH in
volv
es th
e in
stal
latio
n, p
ost-
lay
tren
chin
g, te
rmin
atio
n an
d te
stin
g of
86
inne
r arr
ay g
rid s
ubm
arin
e co
mpo
site
ca
bles
with
in th
e G
erm
an s
ecto
r of t
he
Balti
c Se
a. T
he p
lann
ed c
omm
ence
-m
ent o
f the
pro
ject
was
del
ayed
, but
the
offs
hore
exe
cutio
n be
cam
e ef
fect
ive
earl
y th
ird q
uart
er 2
014
and,
by
year
-end
, 61
of
the
86 c
able
s w
ere
inst
alle
d. A
ll ca
bles
ar
e no
w in
stal
led
and
the
proj
ect i
s sc
hed-
uled
to b
e co
mpl
eted
with
in th
ird q
uart
er
2015
. A p
ositi
ve m
argi
n w
as re
cord
ed o
n th
e pr
ojec
t in
2014
, and
a p
ositi
ve m
argi
n is
sch
edul
ed to
be
reco
rded
in 2
015.
The
Nor
dsee
One
OW
F pr
ojec
t for
Nor
d-se
e O
ne G
mbH
invo
lves
the
EPIC
-bas
ed
supp
ly a
nd in
stal
latio
n of
59
subm
arin
e co
mpo
site
cab
les
form
ing
the
inne
r arr
ay
grid
of t
he N
ords
ee O
ne O
WF.
The
pro
ject
ac
hiev
ed fi
nanc
ial c
lose
in M
arch
201
5,
whe
reby
Can
ada-
base
d N
orth
land
Pow
er
Inc.
had
pre
viou
sly
acqu
ired
an 8
5% s
hare
of
the
proj
ect c
ompa
ny, N
ords
ee O
ne
Gm
bH, f
rom
the
proj
ect d
evel
oper
RW
E In
nogy
Gm
bH in
Sep
tem
ber 2
014.
The
pr
ojec
t inv
olve
s th
e su
pply
of s
ubm
arin
e co
mpo
site
cab
les
and
rela
ted
acce
ssor
ies
as w
ell a
s ca
ble
inst
alla
tion,
pos
t-la
y tr
ench
ing,
term
inat
ion
and
test
ing
wor
ks
and
rem
ains
on
trac
k fo
r mec
hani
cal
com
plet
ion
by fo
urth
qua
rter
201
6. S
OC
ha
s si
nce
seco
nd q
uart
er 2
014
been
ac
tivel
y in
volv
ed in
eng
inee
ring
wor
ks fo
r th
is p
roje
ct, w
here
by th
ese
are
sche
dule
d
for c
ompl
etio
n w
ithin
the
seco
nd q
uart
er
2015
.
In A
pril
2015
, SO
C h
as b
een
awar
ded
the
cont
ract
by
Veja
Mat
e O
ffsh
ore
Proj
ect
Gm
bH fo
r the
EPI
C-b
ased
sup
ply
and
inst
alla
tion
of 7
3 su
bmar
ine
com
posi
te
cabl
es w
ith a
tota
l len
gth
of u
p to
97
km fo
rmin
g th
e in
ner a
rray
grid
of t
he
400
MW
Vej
a M
ate
OW
F as
loca
ted
ap-
prox
imat
ely.
115
km o
ff th
e G
erm
an c
oast
w
ithin
the
Ger
man
Big
ht s
ecto
r of t
he
Nor
th S
ea. T
he p
roje
ct in
volv
es th
e su
pply
of
sub
mar
ine
com
posi
te c
able
s an
d re
-la
ted
acce
ssor
ies
as w
ell a
s ca
ble
inst
al-
latio
n, p
ost-
lay
tren
chin
g, te
rmin
atio
n an
d te
stin
g w
orks
. The
off
shor
e in
stal
latio
n is
sc
hedu
led
to c
omm
ence
in th
ird q
uart
er
2016
with
mec
hani
cal c
ompl
etio
n be
ing
sche
dule
d fo
r sec
ond
quar
ter 2
017.
The
Nor
dsee
One
OW
F ex
port
cab
le
proj
ect f
or T
enne
T O
ffsh
ore
Gm
bH re
pre-
sent
s th
e co
nsor
tium
-bas
ed E
PIC
-bas
ed
cont
ract
for t
he N
ords
ee O
ne e
xpor
t ca
ble
syst
em in
par
tner
ship
with
J-P
ower
Sy
stem
s. C
omm
ence
men
t of t
he o
ffsh
ore
inst
alla
tion
wor
ks is
now
exp
ecte
d to
st
art i
n th
e th
ird q
uart
er 2
016,
with
com
-pl
etio
n sc
hedu
led
in fo
urth
qua
rter
201
6.
No
mar
gin
will
be
reco
rded
on
this
pro
ject
in
201
5.
Mar
ket O
utlo
okTe
nder
ing
activ
ities
incr
ease
d du
ring
the
seco
nd h
alf o
f 201
4 an
d fu
rthe
r ten
ders
ar
e ex
pect
ed d
urin
g 20
15. S
OC
has
est
ab-
lishe
d its
elf a
s a
pred
icta
ble
and
relia
ble
turn
key
cont
ract
or w
ithin
the
offs
hore
re
new
able
ene
rgy
indu
stry
and
furt
her
cont
ract
aw
ards
are
exp
ecte
d.
Shar
ehol
ders
and
Cor
pora
te
Gov
erna
nce
Shar
ehol
der I
nfor
mat
ion
The
Com
pany
’s a
utho
rised
sha
re
capi
tal i
s U
SD 5
,500
,000
.00
divi
ded
into
55
0,00
0,00
0 or
dina
ry s
hare
s of
a n
omin
al
valu
e of
USD
0.0
1 ea
ch. T
he is
sued
sha
re
capi
tal a
t 13
Apr
il 20
15, b
ased
on
the
387,
591,
640
Com
pany
sha
res
issu
ed a
nd
outs
tand
ing,
is U
SD 3
87,5
91,3
80 T
he
Com
pany
’s s
hare
s ar
e lis
ted
on th
e O
slo
Stoc
k Ex
chan
ge w
ith th
e tic
ker s
ymbo
l SI
OFF
. The
larg
est s
hare
hold
er o
f the
C
ompa
ny is
Sie
m E
urop
e S.
a r.l
., a
who
lly-
owne
d su
bsid
iary
of S
iem
Indu
strie
s In
c., w
ith 3
4.2%
of t
he s
hare
s at
13
Apr
il 20
15. D
urin
g 20
14, t
he c
losi
ng s
hare
pr
ice
reac
hed
a hi
gh o
f NO
K 1
0.40
, a lo
w
of N
OK
3.0
4, a
nd c
lose
d at
NO
K 4
.04
at
year
-end
.
Cor
pora
te G
over
nanc
eTh
e C
ompa
ny h
as im
plem
ente
d gu
idel
ines
fo
r cor
pora
te g
over
nanc
e ba
sed
on th
e re
com
men
datio
ns a
nd g
uide
lines
giv
en b
y th
e O
slo
Stoc
k Ex
chan
ge. T
he p
urpo
se o
f th
ese
guid
elin
es is
to c
larif
y th
e di
visi
on o
f ro
les
betw
een
shar
ehol
ders
, the
Gen
eral
M
eetin
g, B
oard
of D
irect
ors
and
day-
to-
day
Man
agem
ent b
eyon
d w
hat f
ollo
ws
from
the
legi
slat
ion.
A d
etai
led
sum
mar
y of
our
cor
pora
te g
over
nanc
e pr
inci
ples
m
ay b
e fo
und
in a
sep
arat
e se
ctio
n of
the
annu
al re
port
.
The
Wor
king
Env
iron
men
t and
th
e Em
ploy
ees
The
Com
pany
see
ks to
pro
vide
a w
ork-
plac
e w
ith e
qual
opp
ortu
nitie
s. W
e se
ek to
tr
eat c
urre
nt a
nd p
rosp
ectiv
e em
ploy
ees
fairl
y w
ith re
spec
t to
sala
ries,
pro
mot
ions
an
d re
crui
tmen
t. Th
e C
ompa
ny o
ffer
s its
em
ploy
ees
a so
und
wor
king
env
ironm
ent.
We
also
giv
e po
ssib
ilitie
s fo
r pro
fess
iona
l de
velo
pmen
t whe
re m
en a
nd w
omen
are
tr
eate
d eq
ually
and
whe
re th
ere
is n
o di
scrim
inat
ion.
The
sick
leav
e fo
r the
ons
hore
and
of
fsho
re e
mpl
oyee
s w
as 1
.7%
and
2.8
%,
resp
ectiv
ely.
No
inci
dent
s or
wor
k-re
late
d ac
cide
nts
resu
lted
in s
igni
fican
t mat
eria
l dam
age
or
pers
onal
inju
ry o
ccur
ed d
urin
g th
e ye
ar.
The
deve
lopm
ent o
f the
ons
hore
and
off
-sh
ore
orga
niza
tions
con
tinue
s in
ord
er to
pr
epar
e fo
r inc
reas
ed fu
ture
act
iviti
es.
The
know
ledg
e of
the
crew
is v
ital f
or a
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
421
Eyst
ein
Erik
srud
Kri
stia
n Si
emM
icha
el D
elou
che
Ch
air
ma
nD
ire
cto
rD
ire
cto
r
(Sig
n.)
(Sig
n.)
(Sig
n.)
John
C. W
alla
ceD
avid
Mul
len
Dir
ec
tor
Dir
ec
tor
(Sig
n.)
(Sig
n.)
Terj
e Sø
rens
enC
hie
f E
xec
uti
ve O
ffic
er
(Sig
n.)
13 A
pril
2015
safe
and
sec
ure
oper
atio
n of
any
ves
sel.
Such
kno
wle
dge
incl
udes
goo
d se
aman
-sh
ip a
nd u
nder
stan
ding
of t
he d
eman
d-in
g as
sign
men
ts to
be
exec
uted
. Thi
s kn
owle
dge
of c
apab
ilitie
s an
d lim
itatio
ns
of th
e ve
ssel
s an
d eq
uipm
ent,
and
resp
ect
of c
ircum
stan
ces
that
may
aff
ect a
saf
e ex
ecut
ion
is v
ital.
Out
look
Ther
e is
a h
igh
focu
s on
cos
t-cu
ttin
g am
ong
oil c
ompa
nies
follo
win
g th
e si
gnifi
-ca
nt d
eclin
e in
the
oil p
rice.
The
num
ber
of v
esse
ls tr
adin
g th
e N
orth
Sea
spo
t mar
-ke
t is
incr
easi
ng w
hile
the
activ
ity le
vel
is e
xpec
ted
to d
ecre
ase.
We
are
prep
ared
to
see
a w
eake
r mar
ket t
he n
ext c
oupl
e of
yea
rs, w
hich
may
lead
to la
y-up
of v
es-
sels
. Sc
rapp
ing
of o
lder
ves
sels
and
del
ay
or c
ance
llatio
n of
new
ves
sels
from
yar
ds
will
con
trib
ute
to a
mor
e ba
lanc
ed m
arke
t. A
ny m
ater
ial a
nd s
usta
inab
le in
crea
se in
th
e oi
l pric
e w
ill h
ave
a po
sitiv
e im
pact
on
the
dem
and
for o
ffsh
ore
supp
ort v
esse
ls.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
422
Sta
tem
en
t o
f P
oli
cy
on
Co
rpo
rate
Go
ve
rna
nc
e
The
prin
cipl
es fo
r cor
pora
te g
over
nanc
e ad
opte
d by
the
Com
pany
are
bas
ed o
n th
e “N
orw
egia
n Re
com
men
datio
n fo
r C
orpo
rate
Gov
erna
nce”
issu
ed o
n th
e 30
Oct
ober
201
4.
As
a co
mpa
ny in
corp
orat
ed in
the
Cay
man
Is
land
s, S
iem
Off
shor
e In
c. is
an
exem
pted
co
mpa
ny d
uly
inco
rpor
ated
und
er th
e la
ws
of th
e C
aym
an Is
land
s an
d su
bjec
t to
Cay
man
Isla
nd la
ws
and
regu
latio
ns w
ith
resp
ect t
o co
rpor
ate
gove
rnan
ce. C
aym
an
Isla
nds
corp
orat
e la
w is
to a
gre
at e
xten
t ba
sed
on E
nglis
h La
w.
In a
dditi
on, d
ue to
th
e C
ompa
ny’s
list
ing
on th
e O
slo
Stoc
k Ex
chan
ge, c
erta
in a
spec
ts o
f Nor
weg
ian
Secu
ritie
s la
w a
pply
to th
e C
ompa
ny a
nd
ther
e is
a re
quire
men
t to
adhe
re to
the
Nor
weg
ian
Cod
e of
Pra
ctic
e fo
r Cor
pora
te
Gov
erna
nce.
The
Nor
weg
ian
Cod
e of
Pra
ctic
e fo
r Cor
-po
rate
Gov
erna
nce
is p
ublic
ly a
vaila
ble
at w
ww
.nue
s.no
in b
oth
Nor
weg
ian
and
Engl
ish
lang
uage
s. D
ue to
new
pro
visi
ons
impl
emen
ted
in th
e N
orw
egia
n A
ccou
nt-
ing
Act
, com
plia
nce
with
the
regu
latio
ns
for C
orpo
rate
Gov
erna
nce
repo
rtin
g is
no
w a
lega
l req
uire
men
t pro
vide
d th
at it
do
es n
ot c
onfli
ct w
ith th
e C
aym
an Is
land
s la
ws
and
regu
latio
ns.
The
Com
pany
end
eavo
urs
to m
aint
ain
high
sta
ndar
ds o
f cor
pora
te g
over
nanc
e an
d is
com
mitt
ed to
ens
urin
g th
at a
ll sh
areh
olde
rs o
f the
Com
pany
are
trea
ted
equa
lly a
nd th
e sa
me
info
rmat
ion
is
com
mun
icat
ed to
all
shar
ehol
ders
at t
he
sam
e tim
e.
Cor
pora
te G
over
nanc
e is
sub
ject
to a
n-nu
al a
sses
smen
t and
revi
ew b
y th
e Bo
ard
of D
irect
ors.
The
Boar
d of
Dire
ctor
s ha
s re
view
ed th
is
stat
emen
t. It
is th
e op
inio
n of
the
Boar
d of
Dire
ctor
s th
at th
e C
ompa
ny c
ompl
ies
with
the
Nor
weg
ian
Cod
e of
Pra
ctic
e fo
r C
orpo
rate
Gov
erna
nce.
This
sta
tem
ent i
s st
ruct
ured
in a
ccor
d-an
ce w
ith T
he N
orw
egia
n C
ode
of P
ract
ice
for C
orpo
rate
Gov
erna
nce.
Bus
ines
s
Cay
man
Isla
nds
law
s an
d re
gula
tion
do
not r
equi
re th
e ob
ject
s cl
ause
of t
he C
om-
pani
es M
emor
andu
m a
nd A
rtic
les
of A
sso-
ciat
ion
to b
e cl
earl
y de
fined
. The
Com
pany
ha
s ho
wev
er a
dopt
ed c
lear
obj
ectiv
es a
nd
stra
tegi
es fo
r its
bus
ines
s.
Siem
Off
shor
e ai
ms
to g
row
the
com
pany
w
ithin
off
shor
e su
ppor
t ves
sels
, bot
h or
gani
cally
and
thro
ugh
com
bina
tion
with
oth
er o
pera
tors
, in
orde
r to
achi
eve
econ
omie
s of
sca
le a
nd s
tron
ger p
rese
nce
in th
e m
arke
t.
Siem
Off
shor
e ai
ms
to b
ecom
e a
pref
erre
d su
pplie
r of m
arin
e se
rvic
es to
the
ener
gy
indu
stry
bas
ed o
n qu
ality
and
relia
bilit
y an
d to
pro
vide
cos
t-ef
ficie
nt s
olut
ions
to
its
cust
omer
s by
und
erst
andi
ng th
eir
oper
atio
n an
d ap
plyi
ng te
chno
logy
and
ex
perie
nce.
The
Com
pany
bui
lds
its b
usin
ess
arou
nd a
m
otiv
ated
wor
kfor
ce w
ith th
e ap
prop
riate
te
chni
cal s
olut
ions
. Thi
s cr
eate
s su
stai
n-ab
le v
alue
for a
ll sh
areh
olde
rs.
Refe
renc
e is
mad
e to
the
Boar
d of
Dire
c-to
rs re
port
for d
etai
led
info
rmat
ion.
Equi
ty a
nd D
ivid
ends
The
prio
ritie
s fo
r the
use
of C
ompa
ny
fund
s ar
e de
term
ined
by
the
Boar
d of
D
irect
ors
and
reco
mm
enda
tions
of M
an-
agem
ent i
nflue
nced
by
exis
ting
cond
ition
s.
At p
rese
nt, p
riorit
ies
for u
se o
f fun
ds
in o
rder
of i
mpo
rtan
ce a
re in
vest
men
t op
port
uniti
es in
the
busi
ness
, rep
aym
ent
of d
ebt a
nd t
he re
turn
of c
apita
l to
the
shar
ehol
ders
in fo
rm o
f sh
are
buy-
back
or
divi
dend
s.
The
Boar
d’s
man
date
to in
crea
se th
e C
ompa
ny’s
sha
re c
apita
l is
limite
d on
ly to
th
e ex
tent
of t
he a
utho
rized
sha
re c
apita
l of
the
Com
pany
with
cer
tain
pre
-em
ptio
n rig
hts
for s
hare
hold
ers
and
in a
ccor
danc
e w
ith th
e C
ompa
ny’s
Mem
oran
dum
and
A
rtic
les
of A
ssoc
iatio
n w
hich
com
ply
with
C
aym
an Is
land
law
.
Und
er th
e A
rtic
les
of A
ssoc
iatio
n, th
e Bo
ard
can
issu
e ne
w s
hare
s, c
onve
rtib
le
bond
s or
war
rant
s at
any
tim
e w
ithin
the
limits
of t
he a
utho
rized
cap
ital w
ithou
t th
e co
nsen
t of t
he g
ener
al m
eetin
g bu
t w
ith p
re-e
mpt
ion
right
s fo
r sha
reho
lder
s.
A G
ener
al M
eetin
g ha
s fu
rthe
r aut
horiz
ed
the
Boar
d to
issu
e ne
w s
hare
s w
ithou
t pr
e-em
ptio
n rig
hts
to a
ll sh
areh
olde
rs u
p to
a li
mit
of 5
0% o
f Sie
m O
ffsh
ore’
sha
res
at th
e tim
e th
e au
thor
izat
ion
was
giv
en.
The
Boar
d ho
lds
auth
oriz
atio
n fr
om th
e A
nnua
l Gen
eral
Mee
ting
held
on
10 M
ay
2010
to is
sue
154,
248,
360
new
sha
res.
Th
e au
thor
ity g
ives
the
Boar
d fle
xibi
lity
to fi
nanc
e in
vest
men
ts, a
cqui
sitio
ns a
nd
othe
r bus
ines
s co
mbi
natio
ns o
n sh
ort n
o-tic
e th
roug
h th
e is
sue
of s
hare
s or
cer
tain
CO
RP
OR
ATE
GO
VER
NA
NC
E
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
423
othe
r equ
ity in
stru
men
ts in
the
Com
pany
. Fu
rthe
rmor
e, th
e Bo
ard
cons
ider
s th
e gr
antin
g of
a n
ew s
tand
ing
auth
ority
at t
he
time
of h
oldi
ng a
n A
nnua
l Gen
eral
Mee
t-in
g ra
ther
than
con
veni
ng a
n Ex
trao
rdi-
nary
Gen
eral
Mee
ting
at s
ome
futu
re ti
me
to b
e in
the
best
inte
rest
s of
the
Com
pany
, as
this
will
resu
lt in
cos
t sav
ings
and
mor
e ef
fect
ive
time
man
agem
ent f
or b
oth
the
Com
pany
’s s
enio
r man
agem
ent a
nd it
s Sh
areh
olde
rs.
Equa
l Tre
atm
ent o
f Sha
reho
lder
s,
Free
ly T
rada
ble
Shar
es a
nd
Tran
sact
ions
wit
h R
elat
ed P
arti
es
The
Com
pany
is c
omm
itted
to e
nsur
ing
that
all
shar
ehol
ders
of t
he C
ompa
ny a
re
trea
ted
equa
lly a
nd a
ll th
e is
sued
sha
res
in S
iem
Off
shor
e, a
t nom
inal
val
ue U
S$
0.01
eac
h, a
re fr
eely
trad
able
and
car
ry
equa
l rig
hts
with
no
rest
rictio
ns o
n vo
ting.
Siem
Indu
strie
s In
c, w
hich
ow
ns 3
4,1%
of
the
Com
pany
, is
repr
esen
ted
by it
s C
hair-
man
, Kris
tian
Siem
, Dep
uty
CEO
, Eys
tein
Er
iksr
ud a
nd P
resi
dent
, Mic
hael
Del
ouch
e,
on th
e B
oard
of D
irect
ors.
The
Com
pany
pa
ys a
n an
nual
fee
to S
iem
Indu
strie
s as
co
mpe
nsat
ion
for d
irect
orsh
ips,
pro
visi
on
of a
n of
fice
and
pres
ence
in th
e C
aym
an
Isla
nds,
and
oth
er s
ervi
ces.
The
fee
is
adop
ted
by th
e an
nual
gen
eral
mee
ting
base
d on
a re
com
men
datio
n fr
om th
e in
-de
pend
ent B
oard
Mem
bers
. Rel
ated
par
ty
tran
sact
ions
are
dis
clos
ed in
the
note
s to
th
e ac
coun
ts.
Free
ly N
egot
iabl
e Sh
ares
All
of th
e sh
ares
in th
e C
ompa
ny c
arry
eq
ual r
ight
s an
d ar
e fr
eely
neg
otia
ble.
The
sh
ares
are
trad
ed a
ccor
ding
to n
orm
al
mar
ket p
ract
ice
and
no s
peci
al li
mita
tions
on
tran
sact
ions
hav
e be
en la
id d
own
in th
e A
rtic
les
of A
ssoc
iatio
n.
Gen
eral
Mee
ting
s
The
Ann
ual G
ener
al M
eetin
g of
the
Com
-pa
ny w
ill b
e he
ld a
t the
regi
ster
ed o
ffice
of
the
Com
pany
on
the
Cay
man
Isla
nds,
1
May
201
5, a
t 9:3
0am
Cay
man
Isla
nds
loca
l tim
e an
d Sh
areh
olde
rs c
an b
e re
pres
ente
d by
pro
xy. N
otic
es o
f gen
eral
m
eetin
gs a
nd re
late
d do
cum
ents
are
m
ade
avai
labl
e to
sha
reho
lder
s at
the
lat-
est 1
7 da
ys p
rior t
o m
eetin
g da
te. N
otic
e of
att
enda
nce
by p
roxy
is to
be
prov
ided
to
eith
er (1
) the
offi
ces
of S
iem
Off
shor
e A
S at
Nod
evig
a 14
, P.O
. Box
425
, Kris
tians
and
4664
, Nor
way
, tel
efax
no.
+47
.37.
40.6
2.86
or
(2) t
he C
ompa
ny’s
offi
ce a
t P.O
. Box
10
597,
Geo
rge
Tow
n, G
rand
Cay
man
K
Y1-1
005,
CAY
MA
N IS
LAN
DS,
tele
fax
no.
+1.3
45.9
46.3
342,
not
less
than
24
hour
s pr
ior t
o th
e st
ated
tim
e of
the
annu
al
gene
ral m
eetin
g. S
hare
hold
ers
are
give
n th
e op
port
unity
to v
ote
on th
e el
ectio
n of
bo
ard
mem
bers
.
Nom
inat
ion
Com
mit
tee
The
appo
intm
ent o
f a n
omin
atio
n co
mm
it-te
e is
not
a re
quire
men
t und
er C
aym
an
Isla
nds
Law
.
Cor
pora
te A
ssem
bly
and
Boa
rd o
f D
irec
tors
; Com
posi
tion
and
Inde
pend
-en
ce
In th
e no
min
atio
ns to
the
Boa
rd o
f Dire
c-to
rs, t
he B
oard
con
sults
with
the
Com
-pa
ny’s
maj
or s
hare
hold
ers
and
ensu
res
that
the
Boar
d is
con
stitu
ted
by D
irect
ors
with
the
nece
ssar
y ex
pert
ise
and
capa
city
. Th
ere
is n
o re
quire
men
t und
er C
aym
an
Isla
nds
Law
for t
he C
ompa
ny to
est
ablis
h a
corp
orat
e as
sem
bly.
Each
Boa
rd m
embe
r is
elec
ted
for a
term
of
2 y
ears
or s
uch
shor
ter t
erm
as
shal
l be
spec
ified
in th
e or
dina
ry re
solu
tion
purs
u-an
t to
whi
ch th
e D
irect
or s
hall
be a
p-po
inte
d. R
epre
sent
ativ
es o
f the
Exe
cutiv
e M
anag
emen
t are
not
pre
sent
ly m
embe
rs
of th
e C
ompa
ny’s
Boa
rd o
f Dire
ctor
s.Th
e Bo
ard
of D
irect
ors
as a
gro
up h
as
exte
nsiv
e ex
perie
nce
in a
reas
whi
ch a
re
impo
rtan
t to
Siem
Off
shor
e, in
clud
ing
off-
shor
e se
rvic
es, i
nter
natio
nal s
hipp
ing,
shi
p br
okin
g, fi
nanc
e an
d co
rpor
ate
gove
rnan
ce
and
rest
ruct
urin
g.
Wor
k of
the
Boa
rd o
f Dir
ecto
rs
The
Boar
d m
onito
rs th
e pe
rfor
man
ce
of m
anag
emen
t thr
ough
regu
lar m
eet-
ings
and
repo
rtin
g. T
he C
ompa
ny h
as a
C
ompe
nsat
ion
Com
mitt
ee a
nd a
n A
udit
Com
mitt
ee.
The
Com
pens
atio
n C
omm
ittee
con
sist
s of
two
Dire
ctor
s. T
he m
anda
te o
f the
co
mm
ittee
is to
revi
ew a
nd a
ppro
ve th
e co
mpe
nsat
ion
of th
e C
EO a
nd a
ny b
onus
es
to a
ll ex
ecut
ive
pers
onne
l. Re
fere
nce
is
also
mad
e to
sec
tion
12, R
emun
erat
ion
of
the
Exec
utiv
e M
anag
emen
t.
The
Aud
it C
omm
ittee
con
sist
s of
two
Dire
ctor
s. T
he c
ompo
sitio
n of
the
com
-m
ittee
mee
ts th
e re
quire
men
ts o
f the
N
orw
egia
n C
ode
of P
ract
ice
for C
orpo
rate
G
over
nanc
e as
rega
rds
inde
pend
ence
. The
co
mm
ittee
’s m
anda
te c
an b
e su
mm
ariz
ed
as fo
llow
s:
• A
scer
tain
that
the
inte
rnal
and
ext
erna
l ac
coun
ting
repo
rtin
g pr
oces
s ar
e or
gani
zed
appr
opria
tely
and
car
ried
out
effic
ient
ly, a
nd a
re o
f hig
h pr
ofes
sion
al
qual
ity.
• M
onito
r and
ass
ess
the
qual
ity o
f the
st
atut
ory
audi
t of t
he C
ompa
ny’s
fina
n-ci
al s
tate
men
ts.
• En
sure
the
inde
pend
ence
of t
he e
xter
-na
l aud
itor,
incl
udin
g an
y ad
ditio
nal s
er-
vice
s pr
ovid
ed b
y th
e ex
tern
al a
udito
r.
Ris
k M
anag
emen
t and
Inte
rnal
Con
trol
Inte
rnal
con
trol
A p
rere
quis
ite fo
r the
Com
pany
’s s
yste
m
of d
ecen
tral
ized
resp
onsi
bilit
y is
that
the
activ
ities
in e
very
par
t of t
he C
ompa
ny
mee
t gen
eral
fina
ncia
l and
non
-fina
ncia
l re
quire
men
ts, a
nd a
re c
arrie
d ou
t in
ac-
cord
ance
with
the
Com
pany
’s c
omm
on
norm
s an
d va
lues
. The
exe
cutiv
e m
anag
e-m
ent o
f eac
h su
bsid
iary
is re
spon
sibl
e fo
r ris
k m
anag
emen
t and
inte
rnal
con
trol
in
the
subs
idia
ry w
ith a
vie
w to
ens
urin
g 1)
op
timal
isat
ion
of b
usin
ess
oppo
rtun
ities
,
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
424
2) ta
rget
ed, s
afe,
hig
h-qu
ality
and
cos
t-ef
fect
ive
oper
atio
ns, 3
) rel
iabl
e fin
anci
al
repo
rtin
g, 4
) com
plia
nce
with
cur
rent
le
gisl
atio
n an
d re
gula
tions
and
5) o
pera
-tio
ns in
acc
orda
nce
with
the
Com
pany
’s
gove
rnin
g do
cum
ents
, inc
ludi
ng e
thic
al
and
soci
al re
spon
sibi
lity
stan
dard
s. T
he
Com
pany
’s ri
sk m
anag
emen
t sys
tem
is
fund
amen
tal t
o th
e ac
hiev
emen
t of t
hese
go
als.
Fina
ncia
l rep
ortin
g pr
oces
s Th
e C
ompa
ny p
repa
res
and
pres
ents
its
finan
cial
sta
tem
ents
in a
ccor
danc
e w
ith
curr
ent I
AS/
IFRS
rule
s. F
inan
cial
info
rma-
tion
from
sub
sidi
arie
s is
rece
ived
eac
h m
onth
in a
repo
rtin
g pa
ckag
e in
sta
nd-
ard
form
at a
ccom
mod
ated
nec
essa
ry
info
rmat
ion
for p
repa
ring
the
cons
olid
ated
fin
anci
al s
tate
men
t for
the
Com
pany
. Th
e re
port
ing
from
the
subs
idia
ries
is e
xten
ded
in th
e ye
ar-e
nd re
port
ing
proc
ess
to m
eet v
ario
us re
quire
men
ts fo
r su
pple
men
tary
info
rmat
ion.
The
re a
re
esta
blis
hed
rout
ines
to c
heck
the
finan
cial
da
ta in
the
rece
ived
repo
rtin
g pa
ckag
es
to e
nsur
e th
e be
st q
ualit
y fo
r the
con
soli-
date
d fig
ures
for t
he C
ompa
ny.
Trai
ning
and
furt
her d
evel
opm
ent o
f ac-
coun
ting
expe
rienc
e w
ithin
the
Com
pany
is
pro
vide
d lo
cally
by
part
icip
atin
g on
var
i-ou
s ex
tern
al c
ours
es o
n a
regu
lar b
asis
.
Rem
uner
atio
n of
the
Boa
rd o
f D
irec
tors
The
rem
uner
atio
n of
the
Boar
d m
embe
rs
refle
ct th
eir e
xper
ienc
e an
d re
spon
sibi
li-tie
s, a
nd is
ado
pted
by
the
annu
al g
ener
al
mee
ting
base
d on
the
reco
mm
enda
tion
from
the
Boar
d. T
he B
oard
mem
bers
do
not h
ave
shar
e op
tions
or p
rofit
-bas
ed
rem
uner
atio
n.
The
resp
onsi
bilit
y st
atem
ent o
f the
Boa
rd
of D
irect
ors
in th
is re
port
and
the
note
s to
the
acco
unts
incl
ude
info
rmat
ion
abou
t th
e re
mun
erat
ion
of th
e Bo
ard
of D
irec-
tors
.
Rem
uner
atio
n of
the
Exec
utiv
e M
an-
agem
ent
The
Com
pany
has
a C
ompe
nsat
ion
Com
-m
ittee
whi
ch re
view
s an
d ap
prov
es th
e co
mpe
nsat
ion
of th
e C
EO a
nd th
e bo
nuse
s to
all
exec
utiv
e pe
rson
nel.
The
Art
icle
s of
Ass
ocia
tion
of th
e C
ompa
ny p
erm
it th
e Bo
ard
to a
ppro
ve th
e gr
antin
g of
sha
re
optio
ns to
em
ploy
ees.
A lo
ng-t
erm
sha
re
optio
n pr
ogra
m fo
r 8 k
ey e
mpl
oyee
s of
the
com
pany
was
intr
oduc
ed in
Q1
2013
. An
addi
tiona
l sha
re o
ptio
n pr
ogra
m w
as im
-pl
emen
ted
in Q
2 20
14 fo
r 10
key
empl
oy-
ees
of th
e co
mpa
ny. T
he re
mun
erat
ion
of
the
CEO
and
the
shar
e op
tion
sche
me
are
disc
lose
d in
the
note
s to
the
acco
unts
.
The
boar
d of
dire
ctor
’s s
tate
men
t on
the
rem
uner
atio
n of
exe
cutiv
e pe
rson
nel
is p
rese
nted
as
a se
para
te a
ppen
dix
to
the
agen
da fo
r the
gen
eral
mee
ting.
The
re
mun
erat
ion
stat
emen
t cle
arly
sta
tes
whi
ch a
spec
ts o
f the
gui
delin
es a
re
advi
sory
and
whi
ch, i
f any
, are
bin
ding
. The
ge
nera
l mee
ting
will
vot
e se
para
tely
on
each
of t
hese
asp
ects
of t
he g
uide
lines
.
Info
rmat
ion
and
Com
mun
icat
ions
The
Com
pany
has
a p
olic
y of
trea
ting
all
its s
hare
hold
ers
and
othe
r mar
ket p
artic
i-pa
nts
equa
lly, a
nd c
omm
unic
ates
rele
vant
an
d ob
ject
ive
info
rmat
ion
on s
igni
fican
t de
velo
pmen
ts w
hich
impa
ct th
e C
ompa
ny
in a
tim
ely
man
ner.
The
Com
pany
als
o se
eks
to e
nsur
e th
at
its a
ccou
ntin
g an
d fin
anci
al re
port
ing
are
to th
e st
anda
rds
of o
ur in
vest
ors,
and
the
Com
pany
pre
sent
s its
fina
ncia
l sta
te-
men
ts in
acc
orda
nce
with
the
Inte
rnat
ion-
al F
inan
cial
Rep
ortin
g St
anda
rds
(IFRS
). Th
e A
udit
Com
mitt
ee o
f the
Boa
rd o
f D
irect
ors
mon
itors
the
com
pany
’s re
port
-in
g on
beh
alf o
f the
Boa
rd.
Not
ices
to th
e O
slo
Stoc
k Ex
chan
ge a
nd
plac
emen
ts o
f not
ices
and
oth
er in
for-
mat
ion,
incl
udin
g qu
arte
rly
and
annu
al
repo
rts,
may
be
foun
d on
the
Com
pany
’s
web
site
(ww
w.s
iem
offs
hore
.com
). Th
e fin
anci
al c
alen
dar f
or 2
015
may
be
foun
d on
the
Com
pany
’s w
ebsi
te u
nder
“Inv
esto
r Re
latio
ns”.
Take
-ove
rs
The
shar
es in
the
Com
pany
are
free
ly tr
ad-
able
and
the
Art
icle
s of
Ass
ocia
tion
of th
e C
ompa
ny d
oes
not h
old
spec
ific
defe
nce
mec
hani
sms
agai
nst t
ake-
over
situ
atio
ns.
In a
take
-ove
r situ
atio
n, th
e Bo
ard
of D
irec-
tors
will
com
ply
with
rele
vant
legi
slat
ion.
Aud
itor
The
Aud
itor o
f the
Com
pany
is e
lect
ed a
t th
e A
nnua
l Gen
eral
Mee
ting
whi
ch a
lso
appr
oves
its
rem
uner
atio
n. D
etai
ls o
f the
C
ompa
ny’s
rem
uner
atio
n of
the
exte
rnal
au
dito
r are
giv
en in
the
note
s to
the
ac-
coun
ts.
The
audi
tor r
epor
ts to
the
Aud
it C
omm
it-te
e tw
ice
a ye
ar a
t a m
inim
um, b
ut m
ore
ofte
n if
nece
ssar
y. D
urin
g th
e la
tter
hal
f of
the
year
, the
ext
erna
l aud
itor p
rese
nts
to th
e A
udit
Com
mitt
ee h
is a
sses
smen
t of
risk
s, in
tern
al c
ontr
ols,
risk
are
as a
nd
impr
ovem
ent p
oten
tial i
n co
ntro
l sys
tem
s an
d hi
s au
dit p
lan
for t
he fo
llow
ing
y ear
. Th
e se
cond
repo
rt to
the
Aud
it C
omm
ittee
is
the
pres
enta
tion
of Y
ear-
End
Aud
it. T
he
exte
rnal
aud
itor p
rese
nts
a su
mm
ary
of
the
audi
t pro
cess
, inc
ludi
ng c
omm
ents
on
audi
ted
inte
rnal
con
trol
pro
cedu
res
and
key
issu
e in
the
finan
cial
repo
rtin
g.
The
Aud
it C
omm
ittee
als
o re
ceiv
es a
n an
nual
inde
pend
ence
repo
rtin
g fr
om th
e ex
tern
al a
udito
r, co
nfirm
ing
the
exte
rnal
au
dito
r’s in
depe
nden
ce w
ith re
spec
t to
the
Com
pany
, with
in th
e m
eani
ng o
f the
N
orw
egia
n A
ct o
n A
uditi
ng a
nd A
udito
rs.
The
confi
rmat
ion
also
incl
udes
ser
vice
s de
liver
ed to
the
Com
pany
oth
er th
an
man
dato
ry a
udit.
CO
RP
OR
ATE
GO
VER
NA
NC
E
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
425
INC
OM
E S
TAT
EM
EN
TS
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
Not
e20
1420
13
405
1
0,95
3 O
pera
ting
reve
nue
4,23
491
,312
3
63,9
55
-12,
521
-18,
774
Ope
ratin
g ex
pens
es8,
18,1
9,20
,23
-297
,187
-2
41,2
91
-12,
116
-7,8
21
Ope
ratin
g m
argi
n 1
94,1
25
122
,663
- -1
32
Dep
reci
atio
n an
d am
ortiz
atio
n4,
5-9
6,88
3 -7
5,84
1
--
Impa
irmen
t of v
esse
ls4,
5-2
9,00
0-
-49,
000
-Im
pairm
ent o
f sha
res
in s
ubsi
diar
ies
4,5,
6-
-
- -
Gai
n/(lo
ss) o
n sa
les
of a
sset
s25
18,
728
29,
827
368
3
68
Gai
n on
sal
e of
inte
rest
rate
der
ivat
ives
(CIR
R)12
368
3
68
- -
Gai
n/(lo
ss) o
n cu
rren
cy d
eriv
ativ
e co
ntra
cts
28 -3
,023
-7
,756
-60,
748
-7,5
84
Ope
ratin
g pr
ofit
4 8
4,31
6 6
9,26
1
FIN
AN
CIA
L IN
CO
ME
AN
D E
XPEN
SES
4,1
62
9,5
86
Fina
ncia
l inc
ome
3,21
9,0
91
5,4
34
-12,
704
-7,8
04
Fina
ncia
l exp
ense
s 3,
21 -5
5,86
8 -3
6,13
2
4,8
42
1,2
19
Net
cur
renc
y ga
in/(
loss
)21
34,
092
-22,
651
-3,7
00
3,0
01
Net
fina
ncia
l ite
ms
-12,
685
-53,
349
- -
Resu
lt fr
om a
ssoc
iate
d co
mpa
nies
7 1
,808
2
,046
-64,
448
-4,5
84
Profi
t /(lo
ss) b
efor
e ta
xes
73,
439
17,
959
- -2
61
Tax
bene
fit/(
expe
nse)
11 -2
,729
3
,585
-64,
448
-4,8
45
Net
pro
fit/(
loss
) 7
0,71
0 2
1,54
4
- -
Att
ribut
able
to n
on-c
ontr
ollin
g in
tere
st
12,
563
-456
-64,
448
-4,8
45
Att
ribu
tabl
e to
sha
reho
lder
s of
the
Com
pany
5
8,14
7 2
2,00
0
Wei
ghte
d av
erag
e nu
mbe
r of o
utst
andi
ng s
hare
s (1
,000
) 3
87,5
91
389
,078
Earn
ings
per
sha
re: B
asic
(and
Dilu
ted)
22 0
.15
0.0
6
CO
MP
REH
ENSI
VE IN
CO
ME
STAT
EMEN
T
-64,
448
-4,8
45
Net
pro
fit/(
loss
) 7
0,71
0 2
1,54
4
Oth
er C
ompr
ehen
sive
inco
me
Item
s th
at w
ill n
ot b
e re
clas
sifie
d to
pro
fit o
r los
s
- -
Pens
ion
rem
easu
rem
ent g
ain
(loss
) 1
,510
1
,155
Item
s th
at m
ay b
e su
bseq
uent
ly re
clas
sifie
d to
pro
fit o
r los
s
--
Cas
h flo
w h
edge
s12
-14,
622
-
- -
Cur
renc
y tr
ansl
atio
n di
ffer
ence
s12
-11,
100
-8,3
20
-64,
448
-4,8
45
Tota
l com
preh
ensi
ve in
com
e fo
r th
e ye
ar 4
6,49
8 1
4,37
8
- -
Att
ribut
able
to n
on c
ontr
ollin
g-in
tere
st
12,
270
-373
-64,
448
-4,8
45
Att
ribu
tabl
e to
sha
reho
lder
s of
the
Com
pany
3
4,22
8 1
4,75
1
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
426
STAT
EM
EN
TS O
F FI
NA
NC
IAL
PO
SIT
ION
AS
SE
TS
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
Not
e12
/31/
2014
12/3
1/20
13
NO
N-C
UR
REN
T IN
TAN
GIB
LE A
SSET
S
- -
Def
erre
d ta
x as
set
11 1
2,59
1 1
1,77
0
- -
Inta
ngib
le a
sset
s5
25,
937
29,
737
- -
Tota
l non
-cur
rent
inta
ngib
le a
sset
s 3
8,52
8 4
1,50
7
NO
N-C
UR
REN
T TA
NG
IBLE
ASS
ETS
- -
Vess
els
unde
r con
stru
ctio
n5,
17 1
30,5
15
127
,711
- -
Vess
els
and
equi
pmen
t5
1,7
43,6
93
1,4
40,3
32
- -
Cap
italiz
ed p
roje
ct c
osts
5 1
0,96
5 1
1,02
7
- -
Tota
l non
-cur
rent
tang
ible
ass
ets
1,8
85,1
73
1,5
79,0
71
NO
N-C
UR
REN
T FI
NA
NC
IAL
ASS
ETS
741
,348
7
52,1
55
Inve
stm
ent i
n su
bsid
iarie
s6
- -
- -
Inve
stm
ent i
n as
soci
ated
com
pani
es7
20,
222
20,
951
28,
453
41,
718
CIR
R Lo
an d
epos
it12
28,
453
41,
718
30,
053
47,
094
Long
-ter
m re
ceiv
able
s9,
14,2
9 2
3,43
2 6
,639
799,
854
840
,967
To
tal n
on-c
urre
nt fi
nanc
ial a
sset
s 7
2,10
8 6
9,30
8
799
,854
840
,967
To
tal n
on-c
urre
nt a
sset
s 1
,995
,809
1
,689
,886
CU
RR
ENT
ASS
ETS
- 3
,447
A
ccou
nts
rece
ivab
le2,
29 7
4,75
3 5
3,19
8
17,
343
7,3
40
Oth
er s
hort
-ter
m re
ceiv
able
s9,
14,2
3,29
63,
877
32,
737
- -
Inve
ntor
ies
7,4
81
7,5
55
- -
Der
ivat
ive
finan
cial
inst
rum
ents
15,2
8,29
1,0
41
-
222
,579
1
32,0
68
Cas
h2,
10,2
9 1
17,6
23
101
,206
239
,922
1
42,8
54
Tota
l cur
rent
ass
ets
264
,774
1
94,6
96
- -
Ass
et h
eld
for s
ale
24,2
5,29
- 1
8,12
1
1,0
39,7
78
983
,821
To
tal a
sset
s 2
,260
,584
1
,902
,702
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
427
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
Not
e12
/31/
2014
12/3
1/20
13
EQU
ITY
526
,236
5
26,2
36
Paid
-in c
apita
l 5
26,2
36
526,
236
-22,
302
-22,
302
Oth
er re
serv
es-4
5,49
1-1
9,76
9
258,
675
324
,612
Re
tain
ed e
arni
ngs
304,
237
250,
161
762
,609
8
28,5
46
Shar
ehol
ders
' equ
ity
2678
4,98
275
6,62
8
- -
Non
-con
trol
ling
inte
rest
38,6
6637
,260
762
,609
82
8,54
6To
tal e
quit
y
823,
649
793,
888
LIA
BIL
ITIE
S
Non
-cur
rent
liab
iliti
es
174,
881
98,
624
Borr
owin
gs
2,12
,14
1,08
7,75
786
3,07
4
28,4
5341
,718
CIR
R Lo
an12
,29
28,4
5341
,718
4,8
85
4,8
85
Tax
liabi
litie
s11
6,36
86,
679
1,78
62,
155
Def
erre
d C
IRR
121,
786
2,15
5
- -
Pens
ion
liabi
litie
s8
3,81
22,
778
- -
Oth
er n
on-c
urre
nt li
abili
ties
1426
,565
18,8
26
210,
005
147,
381
Tota
l non
-cur
rent
liab
iliti
es1,
154,
742
935,
231
Cur
rent
liab
iliti
es
5339
7A
ccou
nts
paya
ble
2,29
10,7
8116
,253
- -
Bor
row
ings
2,12
,14,
2912
6,60
398
,426
- -
Der
ivat
ive
finan
cial
inst
rum
ents
15,2
8,29
16,7
3211
,085
-146
-673
Taxe
s pa
yabl
e 11
5,00
53,
759
67,2
558,
170
Oth
er c
urre
nt li
abili
ties
13,1
4,23
123,
072
44,0
61
67,1
627,
894
Tota
l cur
rent
liab
iliti
es28
2,19
317
3,58
4
277,
167
155,
275
Tota
l lia
bilit
ies
141,
436,
935
1,10
8,81
5
1,03
9,77
898
3,82
1To
tal e
quit
y an
d lia
bilit
ies
2,26
0,58
41,
902,
702
- -
Secu
red
debt
121,
227,
605
968,
868
106
,131
1
20,2
91
Gua
rant
ees
1614
1,69
115
4,31
7
STAT
EM
EN
TS O
F FI
NA
NC
IAL
PO
SIT
ION
EQ
UIT
Y A
ND
LIA
BIL
ITIE
S
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
42828
STAT
EM
EN
TS O
F C
HA
NG
ES IN
EQ
UIT
Y
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
Tota
l no.
of s
hare
sSh
are
capi
tal
Shar
e pr
emiu
m r
eser
ves
Exch
ange
rat
e di
ffer
ence
s
Equi
ty a
s of
Dec
embe
r 31
, 201
2 R
esta
ted
393,
924,
836
3,9
3953
1,02
517
409
Cha
nge
prev
ious
per
iods
Net
pro
fit to
sha
reho
lder
s
Stoc
k op
tion
expe
nces
Com
preh
ensi
ve in
com
e-8
,403
Shar
e is
sues
in p
artia
lly o
wne
d su
bsid
iarie
s
Buy-
back
of s
hare
s-6
333
456
-63
-8,6
64
Shar
e is
sue
cost
s
Equi
ty a
s of
Dec
embe
r 31
, 201
3 3
87,5
91,3
80
3,8
76
522
,361
9
,005
Cha
nge
prev
ious
per
iods
Net
pro
fit to
sha
reho
lder
s
Stoc
k op
tion
expe
nces
Cur
renc
y tr
ansl
atio
n di
ffer
ence
s-1
1,10
0
Pens
ion
rem
easu
rem
ent
Shar
e is
sues
in p
artia
lly o
wne
d su
bsid
iarie
s
Cas
h flo
w h
edge
- -
-
Cap
ital r
educ
tion
in p
artia
lly o
wne
d su
bsid
iarie
s
Div
iden
ds p
aid
Shar
e is
sue
cost
s
Equi
ty a
s of
Dec
embe
r 31
, 201
4 3
87,5
91,3
80
3,8
76
522
,361
-2
,095
Shar
e is
sues
in p
arti
ally
ow
ned
subs
idia
ries
Min
ority
sha
re o
f new
equ
ity S
iem
Off
shor
e M
elin
g D
A
Min
ority
sha
re o
f new
equ
ity S
iem
WIS
AS
Min
ority
sha
re o
f new
equ
ity N
ærin
gsby
gg Id
rett
svei
en 1
3 D
A
Tota
l
PAR
ENT
CO
MPA
NY
Equi
ty a
s of
Dec
embe
r 31
, 201
2 3
93,9
24,8
36
3,9
39
531
,025
-1
00
Oth
er it
ems
Net
pro
fit
Com
preh
ensi
ve in
com
e
Buy-
back
of s
hare
s -6
,333
,456
-6
3 -8
,664
Shar
e is
sue
cost
s
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s
Equi
ty a
s of
Dec
embe
r 31
, 201
3 3
87,5
91,3
80
3,8
76
522
,360
-1
00
Oth
er it
ems,
CIR
R
Net
pro
fit
Com
preh
ensi
ve in
com
e
Buy-
back
of s
hare
s -
- -
Div
iden
d pa
id
Shar
e op
tion
prog
ram
Shar
e is
sue
cost
s
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s
Equi
ty a
s of
Dec
embe
r 31
, 201
4 3
87,5
91,3
80
3,8
76
522
,360
-1
00
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
42929
Oth
er r
eser
ves
Ret
aine
d ea
rnin
gsSh
areh
olde
rs’ e
quit
yN
on-c
ontr
ollin
g in
tere
stTo
tal e
quit
y
-28,
775
225,
824
749
,423
36,
975
786,
397
-1,9
43-1
,943
-1,9
43
22,0
0022
,000
-456
21,5
44
3,12
53,
125
3,12
5
1,15
5-7
,249
83-7
,166
657
657
-8,7
28-8
,728
-28,
775
250
,161
7
56,6
28
37,
260
793
,888
-1,5
10
-1,5
10
-1,5
10
58,
147
58,
147
12,
563
70,
710
2,4
62
2,4
62
2,4
62
- -1
1,10
0 -2
93
-11,
393
1,5
10
1,5
10
1,5
10
- 1
,336
1
,336
-14,
621
-14,
621
- 14
,621
- -1
2,20
1 -1
2,20
1
-6,5
33
-6,5
33
-6,5
33
- -
-43,
396
304
,237
7
84,9
82 3
8,66
6 8
23,6
49
2013
2014
- -
657
1
,336
- -
3,4
56
1,3
36
-22,
203
329
,809
8
42,4
71
-352
-3
52
-4,8
45
-4,8
45 -
-8,7
28 - -
-22,
203
324
,612
8
28,5
46
368
368
-64,
816
-64,
816 - -
-6,5
33 -6
,533
5,04
4 5
,044
- -
-22,
203
258
,675
76
2,60
9
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
430
STAT
EM
EN
TS O
F C
AS
H F
LOW
S
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
Not
e20
1420
13
CASH
FLO
W F
RO
M O
PER
ATIO
NS
-56,
809
-3,3
67
Profi
t/(lo
ss) b
efor
e ta
xes,
exc
ludi
ng in
tere
st30
117
,702
4
9,20
5
-11,
801
-5,8
65
Inte
rest
pai
d -4
6,36
2 -3
2,32
5
- -2
,404
Ta
xes
paid
-8,9
57
-9,8
32
- -3
,777
Re
sult
from
sub
sidi
arie
s -
-
- -
Resu
lt fr
om a
ssoc
iate
d co
mpa
nies
7 -1
,808
-2
,046
- -
Gai
n/(lo
ss) o
n sa
le o
f ass
ets
25 -1
8,72
8 -2
9,82
7
--
Impa
irmen
t of v
esse
ls5
29,0
00-
- 1
32
Dep
reci
atio
n an
d am
ortiz
atio
n5
96,8
83
75,
841
49,0
00-
Impa
irmen
t of s
hare
s in
sub
sidi
arie
s-
-
2,4
62
3,1
25
Stoc
k op
tion
expe
nces
31 2
,462
3
,125
- -
Effe
ct o
f unr
eal.
curr
ency
exc
hang
e fo
rwar
d co
ntra
cts
28 5
,612
1
2,20
0
-7,2
89
1,1
03
Cha
nges
in s
hort
-ter
m re
ceiv
able
s an
d pa
yabl
es 1
9,91
8 -1
7,53
6
-368
-3
68
CIR
R -3
68
-368
0
297
O
ther
cha
nges
-11,
010
10,
549
-24,
805
-11,
125
Net
cas
h fl
ow fr
om o
pera
tion
s 1
84,3
45
58,
986
CASH
FLO
W F
RO
M IN
VEST
MEN
T A
CTI
VITI
ES
4,1
62
5,7
60
Inte
rest
rece
ived
4,1
71
5,3
39
- -2
36
Inve
stm
ent i
n fix
ed a
sset
s 4,
5 -5
25,6
74
-329
,413
- -
Proc
eeds
from
sal
e of
fixe
d as
sets
25 7
6,29
0 8
5,99
8
-17,
041
- Re
ceiv
ed fr
om lo
ng-t
erm
loan
- -
-6,0
00
Inve
stm
ents
in s
ubsi
diar
ies
- -
- -
Div
iden
d fr
om a
ssoc
iate
d co
mpa
nies
7 2
78 9
0
- -
Inve
stm
ents
in a
ssoc
iate
d co
mpa
nies
7 -1
2,20
1 -1
4,40
6
-12,
879
-476
N
et c
ash
flow
from
inve
stm
ent a
ctiv
itie
s -4
57,1
36
-252
,392
CASH
FLO
W F
RO
M F
INA
NC
ING
AC
TIVI
TIES
-6,5
33
-D
ivid
end
paym
ent
-6,5
33
-
- -
Proc
eeds
from
sha
re is
sue
in p
artly
ow
ned
subs
idia
ries
1,3
36
657
- -8
,728
Bu
ybac
k of
sha
res
- -8
,728
60,
000
- Lo
an fr
om s
hare
hold
er -
-
- -
Proc
eeds
from
ban
kove
rdra
ft 5
,624
9
62
76,
256
109
,277
Pr
ocee
ds fr
om n
ew lo
ng-t
erm
bor
row
ing
12 4
47,7
01
320
,319
- -
Repa
ymen
t of l
ong-
term
bor
row
ing
12 -1
31,9
36
-128
,833
129
,723
1
00,5
49
Net
cas
h fl
ow fr
om fi
nanc
ing
acti
viti
es 3
16,1
92
184
,378
92,0
3988
,948
Net
cha
nge
in c
ash
43,4
01-9
,028
132
,068
5
7,27
0 C
ash
at b
ank
as o
f 1
Janu
ary
101
,206
1
07,0
68
-1,5
29 -1
4,15
0Ef
fect
of e
xcha
nge
rate
diff
eren
ces
-26,
985
3,1
66
222,
579
132
,068
C
ash
at b
ank
as o
f 31
Dec
embe
r 1
17,6
23 1
01,2
06
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
431
Phot
ogra
pher
: Tov
e H
ertz
berg
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
432
No
te 1
- A
cc
ou
nti
ng
Pri
nc
iple
s
NO
TES
TO
TH
E A
CC
OU
NTS
Phot
ogra
pher
: Aril
d Li
llebø
Siem
Off
shor
e ow
ns a
nd o
pera
tes
a fle
et o
f off
shor
e su
ppor
t ve
ssel
s, in
clud
ing
Plat
form
Sup
ply
Vess
els,
Off
shor
e Su
bsea
C
onst
ruct
ion
Vess
els,
Anc
hor H
andl
ing,
Tug
, Sup
ply
Vess
els
and
Wel
l-In
terv
entio
n Ve
ssel
s.
and
liste
d on
the
Osl
o St
ock
Exch
ange
. Th
e C
ompa
ny’s
hea
dqua
rter
s is
loca
ted
in
Kris
tians
and,
Nor
way
and
the
Com
pany
is
tax
resi
dent
in N
orw
ay. A
ll re
fere
nces
to
“Sie
m O
ffsh
ore
Inc.
” and
“Com
pany
” sha
ll m
ean
Siem
Off
shor
e In
c. a
nd it
s su
bsid
i-ar
ies
and
asso
ciat
es u
nles
s th
e co
ntex
t in
dica
tes
othe
rwis
e. A
ll re
fere
nces
to
“Par
ent”
sha
ll m
ean
Siem
Off
shor
e In
c. a
s
a pa
rent
com
pany
onl
y.
The
prin
cipa
l acc
ount
ing
polic
ies
appl
ied
in p
repa
ratio
n of
thes
e co
nsol
idat
ed a
nd
pare
nt fi
nanc
ial s
tate
men
ts a
re s
et o
ut
belo
w. T
hese
pol
icie
s ha
ve b
een
cons
ist-
ently
app
lied
to a
ll th
e ye
ars
pres
ente
d,
unle
ss o
ther
wis
e st
ated
.
Siem
Off
shor
e ow
ns a
nd o
pera
tes
a fle
et o
f off
shor
e su
ppor
t ves
sels
, in
clud
ing
Plat
form
sup
ply
ves-
sels
, Off
shor
e Su
bsea
Con
stru
c-tio
n Ve
ssel
s, A
ncho
r Han
dlin
g, T
ug, S
uppl
y Ve
ssel
s an
d W
ell-
Inte
rven
tion
Vess
els.
Si
em O
ffsh
ore
Inc.
com
men
ced
oper
atio
ns
1 Ju
ly 2
005,
and
is a
n ex
empt
ed c
ompa
ny
unde
r the
law
s of
the
Cay
man
Isla
nds
1.1
Gen
eral
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
433
1.2
Bas
is o
f pre
para
tion
The
cons
olid
ated
and
par
ent c
ompa
ny
finan
cial
sta
tem
ents
are
pre
pare
d in
ac
cord
ance
with
Inte
rnat
iona
l Fin
anci
al
Repo
rtin
g St
anda
rds
(IFRS
) and
IFRS
In
terp
reta
tions
Com
mitt
ee (I
FRS
IC)
inte
rpre
tatio
ns a
s en
dors
ed b
y th
e Eu
rope
an U
nion
.
The
finan
cial
sta
tem
ents
als
o in
clud
e an
y ad
ditio
nal a
pplic
able
dis
clos
ures
as
requ
ired
by N
orw
egia
n la
w a
nd O
slo
Stoc
k Ex
chan
ge re
gula
tions
. The
fina
ncia
l st
atem
ents
hav
e be
en p
repa
red
unde
r the
hi
stor
ical
cos
t con
vent
ion,
as
mod
ified
by
spec
ific
finan
cial
ass
ets
and
finan
cial
li-
abili
ties,
nam
ely
deriv
ativ
e in
stru
men
ts, a
t fa
ir va
lue
thro
ugh
profi
t or l
oss
and
deriv
a-tiv
e in
stru
men
ts d
esig
nate
d as
hed
ges,
w
hich
are
initi
ally
at f
air v
alue
thro
ugh
othe
r com
preh
ensi
ve in
com
e (O
CI).
The
fin
anci
al s
tate
men
ts h
ave
been
pre
pare
d un
der t
he a
ssum
ptio
n of
goi
ng-c
once
rn.
All
figur
es a
re in
USD
thou
sand
s, u
nles
s ot
herw
ise
stat
ed.
Man
agem
ent i
s re
quire
d to
mak
e es
ti-m
ates
and
ass
umpt
ions
that
aff
ect t
he re
-po
rted
am
ount
s of
ass
ets
and
liabi
litie
s. In
ad
ditio
n, th
e pr
epar
atio
n of
fina
ncia
l sta
te-
men
ts in
con
form
ity w
ith IF
RS re
quire
s th
e us
e of
cer
tain
crit
ical
acc
ount
ing
estim
ates
. It a
lso
requ
ires
man
agem
ent
to e
xerc
ise
its ju
dgm
ent i
n th
e pr
oces
s of
ap
plyi
ng th
e C
ompa
ny’s
acc
ount
ing
poli-
cies
. The
are
as in
volv
ing
a hi
gher
deg
ree
of ju
dgm
ent o
r com
plex
ity o
r are
as w
here
as
sum
ptio
ns a
nd e
stim
ates
are
sig
nific
ant
to th
e co
nsol
idat
ed fi
nanc
ial s
tate
men
ts
are
disc
lose
d in
not
e 3
Crit
ical
acc
ount
ing
estim
ates
and
judg
men
ts.
1.3
Cha
nges
in a
ccou
ntin
g po
licy
and
disc
losu
res
(a) N
ew s
tand
ards
, am
endm
ents
and
inte
r-pr
etat
ions
ado
pted
by
the
Com
pany
Th
e fo
llow
ing
stan
dard
s ha
ve b
een
adop
ted
by th
e G
roup
for t
he fi
rst t
ime
for
the
finan
cial
yea
r beg
inni
ng o
n or
aft
er 1
Janu
ary
2014
: IF
RS 1
0, C
onso
lidat
ed fi
nanc
ial s
tate
-m
ents
bui
lds
on e
xist
ing
prin
cipl
es b
y id
entif
ying
the
conc
ept o
f con
trol
as
the
dete
rmin
ing
fact
or in
whe
ther
an
entit
y sh
ould
be
incl
uded
with
in th
e co
nsol
idat
ed
finan
cial
sta
tem
ents
of t
he p
aren
t com
-pa
ny. T
he s
tand
ard
prov
ides
add
ition
al
guid
ance
to a
ssis
t in
the
dete
rmin
atio
n of
co
ntro
l whe
re th
is is
diffi
cult
to a
sses
s.
Ado
ptio
n of
IFRS
10
did
not m
ater
ially
af
fect
the
Com
pany
.
IFRS
11,
Joi
nt a
rran
gem
ents
focu
ses
on
the
right
s an
d ob
ligat
ions
of t
he p
artie
s to
the
arra
ngem
ent r
athe
r tha
n its
lega
l fo
rm. T
here
are
two
type
s of
join
t arr
ange
-m
ents
: joi
nt o
pera
tions
and
join
t ven
ture
s.
Join
t ope
ratio
ns a
rise
whe
re th
e in
vest
ors
have
righ
ts to
the
asse
ts a
nd o
blig
atio
ns
for t
he li
abili
ties
of a
n ar
rang
emen
t. A
jo
int o
pera
tor a
ccou
nts
for i
ts s
hare
of t
he
asse
ts, l
iabi
litie
s, re
venu
e an
d ex
pens
es.
Join
t ven
ture
s ar
ise
whe
re th
e in
vest
ors
have
righ
ts to
the
net a
sset
s of
the
ar-
rang
emen
t; jo
int v
entu
res
are
acco
unte
d fo
r und
er th
e eq
uity
met
hod.
Pro
port
iona
l co
nsol
idat
ion
of jo
int a
rran
gem
ents
is n
o lo
nger
per
mitt
ed. T
he C
ompa
ny w
as n
ot
invo
lved
in a
ny jo
int a
rran
gem
ents
dur
ing
2014
or 2
013.
IFRS
12,
Dis
clos
ures
of i
nter
ests
in o
ther
en
titie
s in
clud
es th
e di
sclo
sure
requ
ire-
men
ts fo
r all
form
s of
inte
rest
s in
oth
er
entit
ies,
incl
udin
g jo
int a
rran
gem
ents
, as
soci
ates
, str
uctu
red
entit
ies
and
othe
r of
f-ba
lanc
e sh
eet v
ehic
les.
IFRI
C 2
1, L
evie
s se
ts o
ut th
e ac
coun
ting
for a
n ob
ligat
ion
to p
ay a
levy
that
is n
ot
inco
me
tax.
The
inte
rpre
tatio
n ad
dres
ses
wha
t the
obl
igat
ing
even
t is
that
giv
es
rise
to p
ay a
levy
and
whe
n a
liabi
lity
shou
ld b
e re
cogn
ized
. The
Com
pany
is
not c
urre
ntly
sub
ject
to s
igni
fican
t lev
ies
so th
e ad
optio
n im
pact
of I
FRIC
21
on th
e C
ompa
ny is
not
mat
eria
l.
Am
endm
ent t
o IA
S 32
, Fin
anci
al in
-st
rum
ents
: Pre
sent
atio
n on
off
sett
ing
finan
cial
ass
ets
and
finan
cial
liab
ilitie
s.
This
am
endm
ent c
larifi
es th
at th
e rig
ht o
f se
t-of
f mus
t not
be
cont
inge
nt o
n a
futu
re
even
t. It
mus
t als
o be
lega
lly e
nfor
ce-
able
for a
ll co
unte
rpar
ties
in th
e no
rmal
co
urse
of b
usin
ess,
as
wel
l as
in th
e ev
ent
of d
efau
lt, in
solv
ency
or b
ankr
uptc
y. T
he
amen
dmen
t als
o co
nsid
ers
sett
lem
ent
mec
hani
sms.
The
am
endm
ent i
s re
leva
nt
for t
he C
ompa
ny, s
peci
fical
ly re
late
d to
po
sitio
ns h
eld
in d
eriv
ativ
e co
ntra
cts,
but
ad
optio
n of
the
amen
dmen
t did
not
hav
e a
mat
eria
l eff
ect o
n th
e fin
anci
al s
tate
-m
ents
.
Am
endm
ents
to IA
S 36
, Im
pairm
ent
of a
sset
s on
the
reco
vera
ble
amou
nt
disc
losu
res
for n
on-fi
nanc
ial a
sset
s. T
his
amen
dmen
t rem
oved
cer
tain
dis
clos
ures
of
the
reco
vera
ble
amou
nt o
f CG
Us
whi
ch
had
been
incl
uded
in IA
S 36
by
the
issu
e of
IFRS
13.
Am
endm
ent t
o IA
S 39
, Fin
anci
al in
stru
-m
ents
: Rec
ogni
tion
and
mea
sure
men
t on
the
nova
tion
of d
eriv
ativ
es a
nd th
e co
ntin
uatio
n of
hed
ge a
ccou
ntin
g. T
his
amen
dmen
t con
side
rs le
gisl
ativ
e ch
ange
s to
‘ove
r-th
e-co
unte
r’ de
rivat
ives
and
the
esta
blis
hmen
t of c
entr
al c
ount
erpa
rtie
s.
Und
er IA
S 39
nov
atio
n of
der
ivat
ives
to
cent
ral c
ount
erpa
rtie
s w
ould
resu
lt in
di
scon
tinua
nce
of h
edge
acc
ount
ing.
The
am
endm
ent p
rovi
des
relie
f fro
m d
isco
n-tin
uing
hed
ge a
ccou
ntin
g w
hen
nova
tion
of a
hed
ging
inst
rum
ent m
eets
spe
cifie
d cr
iteria
. The
Com
pany
has
app
lied
the
amen
dmen
t and
ther
e ha
s be
en n
o si
g-ni
fican
t im
pact
on
the
Com
pany
fina
ncia
l st
atem
ents
as
a re
sult.
(b) N
ew s
tand
ards
, am
endm
ents
and
in
terp
reta
tions
not
yet
ado
pted
by
the
Com
pany
A n
umbe
r of n
ew s
tand
ards
and
am
end-
men
ts to
sta
ndar
ds a
nd in
terp
reta
tions
ar
e ef
fect
ive
for a
nnua
l per
iods
beg
inni
ng
afte
r 1 J
anua
ry 2
015,
and
hav
e no
t bee
n ap
plie
d in
pre
parin
g th
e co
nsol
idat
ed a
nd
pare
nt fi
nanc
ial s
tate
men
ts.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
434
NO
TES
TO
TH
E A
CC
OU
NTS
Non
e of
thes
e is
exp
ecte
d to
hav
e a
sign
ifi-
cant
eff
ect o
n th
e co
nsol
idat
ed fi
nanc
ial
stat
emen
ts o
f the
Com
pany
, exc
ept t
he
follo
win
g se
t out
bel
ow:
IFRS
9, F
inan
cial
inst
rum
ents
add
ress
es
the
clas
sific
atio
n, m
easu
rem
ent a
nd re
c-og
nitio
n of
fina
ncia
l ass
ets
and
finan
cial
lia
bilit
ies.
The
com
plet
e ve
rsio
n of
IFRS
9
was
issu
ed in
Jul
y 20
14. I
t rep
lace
s th
e gu
idan
ce in
IAS
39 th
at re
late
s to
the
clas
-si
ficat
ion
and
mea
sure
men
t of fi
nanc
ial
inst
rum
ents
. IFR
S 9
reta
ins
but s
impl
i-fie
s th
e m
ixed
mea
sure
men
t mod
el a
nd
esta
blis
hes
thre
e pr
imar
y m
easu
rem
ent
cate
gorie
s: fo
r fina
ncia
l ass
ets:
am
ortiz
ed
cost
, fai
r val
ue th
roug
h O
CI a
nd fa
ir va
lue
thro
ugh
P&L.
The
basi
s of
cla
ssifi
catio
n de
pend
s on
th
e en
tity’
s bu
sine
ss m
odel
and
the
cont
ract
ual c
ash
flow
cha
ract
eris
tics
of
the
finan
cial
ass
et. I
nves
tmen
ts in
equ
ity
inst
rum
ents
are
requ
ired
to b
e m
easu
red
at fa
ir va
lue
thro
ugh
profi
t or l
oss
with
the
irrev
ocab
le o
ptio
n at
ince
ptio
n to
pre
sent
ch
ange
s in
fair
valu
e in
OC
I not
recy
clin
g.
Ther
e is
now
a n
ew e
xpec
ted
cred
it lo
sses
m
odel
that
repl
aces
the
incu
rred
loss
im
pairm
ent m
odel
use
d in
IAS
39. F
or
finan
cial
liab
ilitie
s th
ere
wer
e no
cha
nges
to
cla
ssifi
catio
n an
d m
easu
rem
ent e
xcep
t fo
r the
reco
gniti
on o
f cha
nges
in o
wn
cred
it ris
k in
oth
er c
ompr
ehen
sive
inco
me,
fo
r lia
bilit
ies
desi
gnat
ed a
t fai
r val
ue
thro
ugh
profi
t or l
oss.
IFRS
9 re
laxe
s th
e re
quire
men
ts fo
r hed
ge
effe
ctiv
enes
s by
repl
acin
g th
e br
ight
line
he
dge
effe
ctiv
enes
s te
sts.
It re
quire
s an
eco
nom
ic re
latio
nshi
p be
twee
n th
e he
dged
item
and
hed
ging
inst
rum
ent a
nd
for t
he ‘h
edge
d ra
tio’ t
o be
the
sam
e as
th
e on
e m
anag
emen
t act
ually
use
for r
isk
man
agem
ent p
urpo
ses.
Con
tem
pora
ne-
ous
docu
men
tatio
n is
stil
l req
uire
d bu
t is
diff
eren
t to
that
cur
rent
ly p
repa
red
unde
r IA
S 39
. The
sta
ndar
d is
eff
ectiv
e fo
r ac-
coun
ting
perio
ds b
egin
ning
on
or a
fter
1
Janu
ary
2018
. Ear
ly a
dopt
ion
is p
erm
itted
, de
pend
ent o
n EU
app
rova
l. Th
e C
ompa
ny
is y
et to
ass
ess
IFRS
9’s
full
impa
ct.
IFRS
15,
Rev
enue
from
con
trac
ts w
ith
cust
omer
s de
als
with
reve
nue
reco
gniti
on
and
esta
blis
hes
prin
cipl
es fo
r rep
ortin
g us
eful
info
rmat
ion
to u
sers
of fi
nanc
ial
stat
emen
ts a
bout
the
natu
re, a
mou
nt, t
im-
ing
and
unce
rtai
nty
of re
venu
e an
d ca
sh
flow
s ar
isin
g fr
om a
n en
tity’
s co
ntra
cts
with
cus
tom
ers.
Reve
nue
is re
cogn
ized
whe
n a
cust
omer
ob
tain
s co
ntro
l of a
goo
d or
ser
vice
and
th
us h
as th
e ab
ility
to d
irect
the
use
and
obta
in th
e be
nefit
s fr
om th
e go
od o
r ser
-vi
ce. T
he s
tand
ard
repl
aces
IAS
18 R
ev-
enue
and
IAS
11 C
onst
ruct
ion
cont
ract
s an
d re
late
d in
terp
reta
tions
. The
sta
ndar
d is
eff
ectiv
e fo
r ann
ual p
erio
ds b
egin
ning
on
or a
fter
1 J
anua
ry 2
017
and
earl
ier
appl
icat
ion
is p
erm
itted
, dep
ende
nt o
n EU
ap
prov
al. T
he C
ompa
ny is
ass
essi
ng th
e im
pact
of I
FRS
15.
Ther
e ar
e no
oth
er IF
RSs
or IF
RIC
inte
r-pr
etat
ions
that
are
not
yet
eff
ectiv
e th
at
wou
ld b
e ex
pect
ed to
hav
e a
mat
eria
l im
pact
on
the
Com
pany
.
1.4
Con
solid
atio
n
a) S
ubsi
diar
ies
Subs
idia
ries
are
entit
ies
over
whi
ch th
e Pa
rent
has
con
trol
. The
Par
ent c
ontr
ols
an e
ntity
whe
n th
e Pa
rent
is e
xpos
ed to
, or
has
righ
ts to
, var
iabl
e re
turn
s fr
om it
s in
volv
emen
t with
the
entit
y an
d ha
s th
e ab
ility
to a
ffec
t tho
se re
turn
s th
roug
h its
po
wer
ove
r the
ent
ity. S
ubsi
diar
ies
are
fully
con
solid
ated
from
the
date
on
whi
ch
cont
rol i
s tr
ansf
erre
d to
the
Com
pany
. Th
ey a
re d
econ
solid
ated
from
the
date
th
at c
ontr
ol c
ease
s.
The
Com
pany
app
lies
the
acqu
isiti
on
met
hod
to a
ccou
nt fo
r bus
ines
s co
mbi
na-
tions
. The
con
side
ratio
n tr
ansf
erre
d fo
r th
e ac
quis
ition
of a
sub
sidi
ary
is th
e fa
ir va
lues
of t
he a
sset
s tr
ansf
erre
d an
d th
e lia
bilit
ies
assu
med
from
to th
e fo
rmer
ow
ners
of t
he a
cqui
rer a
nd th
e eq
uity
in
tere
sts
issu
ed b
y th
e C
ompa
ny. T
he
cons
ider
atio
n tr
ansf
erre
d in
clud
es th
e fa
ir va
lue
of a
ny a
sset
or l
iabi
lity
resu
lting
from
a c
ontin
gent
con
side
ratio
n ar
rang
e-m
ent.
Iden
tifiab
le a
sset
s ac
quire
d an
d li-
abili
ties
and
cont
inge
nt li
abili
ties
assu
med
in
a b
usin
ess
com
bina
tion
are
mea
sure
d in
itial
ly a
t the
ir fa
ir va
lues
at t
he a
cqui
si-
tion
date
. The
Com
pany
reco
gniz
es a
ny
non-
cont
rolli
ng in
tere
st in
the
acqu
iree
on
an a
cqui
sitio
n-by
-acq
uisi
tion
basi
s, e
ither
at
fair
valu
e or
at t
he n
on-c
ontr
ollin
g in
tere
st’s
pro
port
iona
te s
hare
of t
he re
c-og
nize
d am
ount
s of
acq
uire
e’s
iden
tifiab
le
net a
sset
s. A
cqui
sitio
n-re
late
d co
sts
are
expe
nsed
as
incu
rred
.
If th
e bu
sine
ss c
ombi
natio
n is
ach
ieve
d in
st
ages
, fai
r val
ue o
f the
acq
uire
r’s p
revi
-ou
sly
held
equ
ity in
tere
st in
the
acqu
iree
is re
mea
sure
d to
fair
valu
e at
the
acqu
isi-
tion
date
thro
ugh
profi
t or l
oss.
Any
con
tinge
nt c
onsi
dera
tion
to b
e tr
ans-
ferr
ed b
y th
e C
ompa
ny is
reco
gniz
ed a
t fa
ir va
lue
at th
e ac
quis
ition
dat
e. S
ub-
sequ
ent c
hang
es to
the
fair
valu
e of
the
cont
inge
nt c
onsi
dera
tion
that
is d
eem
ed
to b
e an
ass
et o
r lia
bilit
y is
reco
gniz
ed in
ac
cord
ance
with
IAS
39 e
ither
in p
rofit
or
loss
or a
s a
chan
ge to
oth
er c
ompr
ehen
-si
ve in
com
e. C
ontin
gent
con
side
ratio
n th
at
is c
lass
ified
as
equi
ty is
not
rem
easu
red
and
its s
ubse
quen
t set
tlem
ent i
s ac
coun
t-ed
for w
ithin
equ
ity.
Inte
rcom
pany
tran
sact
ions
, bal
ance
s, a
nd
unre
aliz
ed g
ains
on
tran
sact
ions
bet
wee
n C
ompa
ny c
ompa
nies
are
elim
inat
ed.
Unr
ealiz
ed lo
sses
are
als
o el
imin
ated
. W
hen
nece
ssar
y, a
mou
nts
repo
rted
by
subs
idia
ries
have
bee
n ad
just
ed to
ens
ure
cons
iste
ncy
with
the
polic
ies
adop
ted
by
the
Com
pany
. (b
) Ass
ocia
ted
com
pani
es
Ass
ocia
tes
are
entit
ies
over
whi
ch th
e C
ompa
ny h
as s
igni
fican
t infl
uenc
e bu
t not
co
ntro
l, ge
nera
lly a
ccom
pany
ing
a sh
are-
hold
ing
of b
etw
een
20%
and
50%
of t
he
votin
g rig
hts.
Inve
stm
ents
in a
ssoc
iate
s ar
e ac
coun
ted
for u
sing
the
equi
ty m
etho
d of
acc
ount
ing
and
are
initi
ally
reco
gniz
ed
at c
ost.
The
Com
pany
’s in
vest
men
t in
asso
ciat
es in
clud
es g
oodw
ill id
entifi
ed
on a
cqui
sitio
n. T
he s
hare
of p
rofit
or l
oss
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
435
The
rele
vant
exc
hang
e ra
tes
vs. U
SD a
re:
Ave
rage
20
1431
.12.
14A
vera
ge
2013
31.1
2.20
13
NO
K (N
orw
egia
n kr
oner
) 0
.157
50.
1345
0.17
000.
1643
EUR
(Eur
os)
1.32
561.
2157
1.33
001.
3778
GB
P (P
ound
Ste
rlin
g)1.
6448
1.55
671.
5699
1.65
24
REA
S (B
razi
lian
Real
s)0.
4240
0.37
650.
4620
0.42
68
reco
rded
in th
e co
nsol
idat
ed fi
nanc
ial
stat
emen
ts is
bas
ed o
n th
e af
ter-
tax
earn
-in
gs o
f the
ass
ocia
te.
The
Com
pany
’s s
hare
of p
ost-
acqu
isiti
on
profi
t or l
oss
is re
cogn
ized
in th
e in
com
e st
atem
ent,
and
its s
hare
of p
ost-
acqu
isi-
tion
mov
emen
ts in
oth
er c
ompr
ehen
sive
in
com
e is
reco
gniz
ed in
oth
er c
ompr
e-he
nsiv
e in
com
e w
ith a
cor
resp
ondi
ng
adju
stm
ent t
o th
e ca
rryi
ng a
mou
nt o
f the
in
vest
men
t. W
hen
the
Com
pany
’s s
hare
of
loss
es in
an
asso
ciat
e eq
uals
or e
xcee
ds
its in
tere
st in
the
asso
ciat
e, in
clud
ing
any
othe
r uns
ecur
ed re
ceiv
able
s, th
e C
om-
pany
doe
s no
t rec
ogni
ze fu
rthe
r los
ses
unle
ss it
has
incu
rred
lega
l or c
onst
ruct
ive
oblig
atio
ns o
r mad
e pa
ymen
ts o
n be
half
of
the
asso
ciat
e.
Unr
ealiz
ed g
ains
on
tran
sact
ions
bet
wee
n th
e C
ompa
ny a
nd it
s as
soci
ates
are
el
imin
ated
to th
e ex
tent
of t
he C
ompa
ny’s
in
tere
st in
the
asso
ciat
es. U
nrea
lized
lo
sses
are
elim
inat
ed u
nles
s th
e tr
ansa
c-tio
n pr
ovid
es e
vide
nce
of a
n im
pairm
ent o
f th
e as
set t
rans
ferr
ed. A
ccou
ntin
g po
licie
s of
ass
ocia
tes
have
bee
n ch
ange
d w
here
ne
cess
ary
to e
nsur
e co
nsis
tenc
y w
ith th
e po
licie
s ad
opte
d by
the
Com
pany
.
1.5
Cla
ssifi
cati
on o
f ite
ms
in th
e fin
an-
cial
sta
tem
ents
Ass
ets
desi
gnat
ed fo
r lon
g-te
rm o
wne
r-sh
ip o
r use
and
rece
ivab
les
due
late
r tha
n on
e ye
ar a
fter
dra
wdo
wn
are
clas
sifie
d as
non
-cur
rent
ass
ets.
Oth
er a
sset
s ar
e cl
assi
fied
as c
urre
nt a
sset
s.
Liab
ilitie
s du
e la
ter t
han
one
year
aft
er th
e en
d of
the
repo
rtin
g pe
riod
are
clas
sifie
d as
no
n-cu
rren
t lia
bilit
ies.
Oth
er li
abili
ties
are
clas
sifie
d as
cur
rent
liab
ilitie
s. A
ll de
riva-
tive
finan
cial
inst
rum
ents
are
cla
ssifi
ed a
s cu
rren
t ass
ets
or c
urre
nt li
abili
ties.
1.6
Segm
ent r
epor
ting
Ope
ratin
g se
gmen
ts a
re re
port
ed in
a
man
ner c
onsi
sten
t with
the
inte
rnal
re
port
ing
prov
ided
to th
e ch
ief o
pera
t-in
g de
cisi
on-m
aker
. The
chi
ef o
pera
ting
deci
sion
-mak
er, w
ho is
resp
onsi
ble
for
allo
catin
g re
sour
ces
and
asse
ssin
g pe
r-fo
rman
ce o
f the
ope
ratin
g se
gmen
ts, h
as
been
iden
tified
as
the
exec
utiv
e m
anag
e-m
ent t
eam
con
sist
ing
of th
e C
EO, C
FO,
CC
O a
nd C
OO
.
The
Com
pany
is o
rgan
ized
into
eig
ht d
if-fe
rent
seg
men
ts, p
latf
orm
sup
ply
vess
els
(“PS
Vs”)
, off
shor
e su
bsea
con
stru
ctio
n ve
ssel
s (“
OSC
Vs),
anch
or-h
andl
ing
tug
supp
ly v
esse
ls (“
AH
TS V
esse
ls”)
, Oth
er
Vess
els
in B
razi
l (co
nsis
ting
of fa
st c
rew
ve
ssel
s (“
FCVs
”), f
ast s
uppl
y ve
ssel
s (“
FSVs
”) a
nd o
il sp
ill re
cove
ry v
esse
ls
(“O
SRVs
”)),
Com
bat M
anag
emen
t Sys
tem
s (“
CM
S”),
Subm
arin
e Po
wer
Cab
le In
stal
la-
tion,
Sci
entifi
c C
ore-
Dril
ling
and
Oth
er.
1.7
For
eign
cur
renc
y tr
ansl
atio
n
(a) F
unct
iona
l and
pre
sent
atio
n cu
rren
cy
Item
s in
clud
ed in
the
finan
cial
sta
tem
ents
of
eac
h of
the
Com
pany
’s e
ntiti
es a
re
mea
sure
d us
ing
the
curr
ency
of t
he p
ri-m
ary
econ
omic
env
ironm
ent i
n w
hich
the
entit
y op
erat
es (t
he “f
unct
iona
l cur
renc
y”).
The
cons
olid
ated
fina
ncia
l sta
tem
ents
are
pr
esen
ted
in U
SD, w
hich
is th
e C
ompa
ny’s
pr
esen
tatio
n cu
rren
cy.
(b) T
rans
actio
ns a
nd b
alan
ces
Fore
ign
curr
ency
tran
sact
ions
are
tran
s-la
ted
into
the
func
tiona
l cur
renc
y us
ing
the
exch
ange
rate
s pr
evai
ling
at th
e da
tes
of th
e tr
ansa
ctio
ns. F
orei
gn e
xcha
nge
gain
s an
d lo
sses
resu
lting
from
the
sett
lem
ent o
f suc
h tr
ansa
ctio
ns a
nd fr
om
the
tran
slat
ion
at y
ear-
end
exch
ange
rate
s of
mon
etar
y as
sets
and
liab
ilitie
s de
nom
i-na
ted
in fo
reig
n cu
rren
cies
are
reco
gniz
ed
in th
e in
com
e st
atem
ent l
ine
item
Net
cu
rren
cy g
ain
/ los
s.
(c) G
roup
com
pani
es
The
resu
lts a
nd fi
nanc
ial p
ositi
on o
f all
the
Gro
up c
ompa
nies
(non
e of
whi
ch h
ave
the
curr
ency
of a
hyp
erin
flatio
nary
eco
nom
y)
that
hav
e a
func
tiona
l cur
renc
y di
ffer
-en
t fro
m th
e pr
esen
tatio
n cu
rren
cy a
re
tran
slat
ed in
to th
e pr
esen
tatio
n cu
rren
cy
as fo
llow
s:
(i) a
sset
s an
d lia
bilit
ies
for e
ach
stat
e-m
ent o
f fina
ncia
l pos
ition
pre
sent
ed a
re
tran
slat
ed a
t the
clo
sing
rate
at t
he d
ate
of th
at s
tate
men
t of fi
nanc
ial p
ositi
on;
(ii)
inco
me
and
expe
nses
for e
ach
inco
me
stat
emen
t are
tran
slat
ed a
t ave
rage
ex-
chan
ge ra
tes
(unl
ess
this
ave
rage
is n
ot a
re
ason
able
app
roxi
mat
ion
of th
e cu
mul
a-tiv
e ef
fect
of t
he ra
tes
prev
ailin
g on
the
tran
sact
ion
date
s, in
whi
ch c
ase
inco
me
and
expe
nses
are
tran
slat
ed a
t the
dat
es
of th
e tr
ansa
ctio
ns);
and
(iii)
all
resu
lting
exc
hang
e di
ffer
ence
s ar
e re
cogn
ized
in o
ther
com
preh
ensi
ve
inco
me.
As
part
of t
he c
onso
lidat
ion
proc
ess,
ex
chan
ge d
iffer
ence
s ar
isin
g fr
om th
e tr
ansl
atio
n of
the
net i
nves
tmen
t in
fore
ign
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
436
NO
TES
TO
TH
E A
CC
OU
NTS
oper
atio
ns is
reco
gniz
ed d
irect
ly in
Oth
er
com
preh
ensi
ve In
com
e (O
CI).
Whe
n a
fore
ign
oper
atio
n is
sol
d, e
xcha
nge
dif-
fere
nces
pre
viou
sly
reco
gniz
ed in
OC
I are
re
clas
sifie
d to
pro
fit o
r los
s an
d in
clud
ed
in th
e ga
in o
r los
s on
sal
e.
Goo
dwill
and
fair
valu
e ad
just
men
ts a
ris-
ing
on th
e ac
quis
ition
of a
fore
ign
entit
y ar
e tr
eate
d as
ass
ets
and
liabi
litie
s of
the
fore
ign
entit
y an
d tr
ansl
ated
at t
he c
losi
ng
rate
. Exc
hang
e di
ffer
ence
s ar
isin
g ar
e re
cogn
ized
in O
CI.
1.8
Non
-cur
rent
tang
ible
ass
ets
and
mai
nten
ance
cos
ts
Land
and
Bui
ldin
gs a
nd V
esse
ls a
re s
tate
d at
thei
r his
toric
al c
ost l
ess
accu
mul
ated
de
prec
iatio
n an
d ne
t of a
ny im
pairm
ent
loss
es.
All
non-
curr
ent t
angi
ble
asse
ts
(exc
ludi
ng L
and
and
Vess
els
unde
r con
-st
ruct
ion)
are
dep
reci
ated
on
a st
raig
ht-
line
basi
s ov
er th
e es
timat
ed re
mai
ning
us
eful
eco
nom
ic li
fe o
f the
ass
et.
The
ves-
sel r
esid
ual v
alue
is th
e es
timat
ed fu
ture
sa
les
pric
e fo
r ste
el le
ss th
e es
timat
ed
cost
s as
soci
ated
with
scr
appi
ng a
ves
sel.
The
resi
dual
val
ue a
nd e
xpec
ted
usef
ul
life
for a
ll no
n-cu
rren
t tan
gibl
e as
sets
is
revi
ewed
ann
ually
and
, whe
re th
ey d
iffer
si
gnifi
cant
ly fr
om p
revi
ous
estim
ates
, the
ra
te o
f dep
reci
atio
n ch
arge
s is
cha
nged
ac
cord
ingl
y.
The
vess
els
pres
ently
ow
ned
by th
e C
ompa
ny h
ave
an e
stim
ated
eco
nom
ic
life
of 3
0 ye
ars.
Som
e co
mpo
nent
s of
the
vess
els
have
a s
hort
er e
cono
mic
life
than
30
yea
rs. T
he v
esse
ls a
re d
ecom
pose
d in
to d
iffer
ent c
ompo
nent
s an
d ea
ch c
om-
pone
nt is
dep
reci
ated
ove
r its
est
imat
ed
econ
omic
life
. Eac
h pa
rt o
f a v
esse
l tha
t is
sign
ifica
nt to
the
tota
l cos
t of t
he v
esse
l is
sep
arat
ely
iden
tified
and
dep
reci
ated
ov
er th
at c
ompo
nent
’s u
sefu
l life
time.
C
ompo
nent
s w
ith s
imila
r use
ful l
ives
are
in
clud
ed in
one
com
pone
nt.
The
Com
pany
ha
s id
entifi
ed n
ine
sign
ifica
nt c
ompo
nent
s re
latin
g to
its
diff
eren
t typ
es o
f ves
sels
. Se
e no
te 5
for a
dditi
onal
info
rmat
ion.
D
ry-d
ocki
ng -
In a
ccor
danc
e w
ith IA
S 16
and
the
cost
mod
el, d
ry-d
ocki
ng c
osts
are
a
sepa
rate
com
pone
nt o
f the
shi
p’s
cost
at
purc
hase
with
a d
iffer
ent p
atte
rn o
f ben
-efi
ts a
nd a
re th
eref
ore
initi
ally
reco
gniz
ed
as a
sep
arat
e de
prec
iabl
e as
set.
Subs
e-qu
ently
, the
cos
t of m
ajor
reno
vatio
ns a
nd
perio
dic
mai
nten
ance
cos
ts a
re c
apita
lized
as
a d
ry-d
ocki
ng a
sset
and
dep
reci
ated
ov
er th
e us
eful
life
of t
he p
arts
repl
aced
. Th
e us
eful
life
of t
he d
ry-d
ocki
ng c
osts
w
ill b
e th
e pe
riod
until
the
next
doc
king
, no
rmal
ly b
etw
een
two
to th
ree
year
s. D
ay-
to-d
ay m
aint
enan
ce c
osts
are
imm
edia
tely
ex
pens
ed d
urin
g th
e re
port
ing
perio
d in
w
hich
they
are
incu
rred
.
Cap
italiz
ed p
roje
ct c
ost -
Cer
tain
ves
sel
cont
ract
s re
quire
an
inve
stm
ent p
rior t
o co
mm
enci
ng th
e co
ntra
ct to
fulfi
l req
uire
-m
ents
set
by
the
char
tere
r. Th
ese
inve
st-
men
ts a
re c
apita
lized
and
am
ortiz
ed o
ver
the
term
of t
he s
peci
fic c
hart
er c
ontr
act.
Gai
ns a
nd lo
sses
on
the
sale
of a
sset
s an
d di
spos
als
are
dete
rmin
ed b
y co
mpa
ring
the
sale
s or
dis
posa
l pro
ceed
s w
ith th
e ne
t car
ryin
g am
ount
and
are
incl
uded
in
oper
atin
g pr
ofit.
1.9
New
build
con
trac
ts a
nd b
orro
win
g co
sts
Inst
allm
ents
on
new
build
con
trac
ts a
re
clas
sifie
d as
non
-cur
rent
tang
ible
ass
ets.
D
irect
cos
ts re
late
d to
the
on-s
ite s
uper
vi-
sion
and
oth
er p
re-d
eliv
ery
cons
truc
tion
cost
s ar
e ca
pita
lized
per
ves
sel.
Gen
eral
and
spe
cific
bor
row
ing
cost
s di
-re
ctly
rela
ted
to th
e ac
quis
ition
, con
stru
c-tio
n or
pro
duct
ion
of q
ualif
ying
ves
sels
are
ad
ded
to th
e co
st o
f tho
se v
esse
ls, u
ntil
such
tim
e as
the
vess
els
are
subs
tant
ially
re
ady
for t
heir
inte
nded
use
or s
ale.
All
othe
r bor
row
ing
cost
s ar
e re
cogn
ized
in
the
profi
t or l
oss
in th
e pe
riod
in w
hich
th
ey a
re in
curr
ed.
Inte
rest
exp
ense
elig
ible
for c
apita
lizat
ion
is o
nly
adju
sted
for t
he e
ffec
t of i
nter
est
rate
or c
ross
-cur
renc
y in
tere
st ra
te s
wap
s th
at a
re d
esig
nate
d an
d qu
alify
as
an a
c-co
untin
g he
dge
unde
r IA
S 39
. C
urre
ntly
the
Com
pany
doe
s no
t hav
e an
y in
tere
st
rate
or c
ross
-cur
renc
y sw
ap c
ontr
acts
de
sign
ated
as
hedg
es.
1.10
Impa
irm
ent o
f non
-fina
ncia
l as-
sets
In
tang
ible
ass
ets
that
hav
e an
inde
finite
us
eful
life
or i
ntan
gibl
e as
sets
not
read
y to
use
are
not
sub
ject
to a
mor
tizat
ion
and
are
test
ed a
nnua
lly fo
r im
pairm
ent.
Ass
ets
that
are
sub
ject
to a
mor
tizat
ion
are
revi
ewed
for i
mpa
irmen
t whe
neve
r ev
ents
or c
hang
es in
circ
umst
ance
s in
dica
te th
at th
e ca
rryi
ng a
mou
nt m
ay
not b
e re
cove
rabl
e. A
n im
pairm
ent l
oss
is
reco
gniz
ed fo
r the
am
ount
by
whi
ch th
e as
set’s
car
ryin
g am
ount
exc
eeds
its
reco
v-er
able
am
ount
. The
reco
vera
ble
amou
nt
is th
e hi
gher
of a
n as
set’s
fair
valu
e le
ss
cost
s of
dis
posa
l and
val
ue in
use
. The
re
cove
rabl
e am
ount
is e
stab
lishe
d in
di-
vidu
ally
for a
ll as
sets
. In
ass
essi
ng v
alue
in
use
, the
est
imat
ed fu
ture
cas
h flo
ws
are
disc
ount
ed to
thei
r pre
sent
val
ue u
sing
a
pre-
tax
disc
ount
rate
that
refle
cts
curr
ent
mar
k et a
sses
smen
ts o
f the
tim
e an
d th
e ris
k sp
ecifi
c to
the
asse
t tha
t is
cons
ider
ed
impa
ired.
Prio
r im
pairm
ents
of n
on-fi
nanc
ial a
sset
s (o
ther
than
goo
dwill
) are
revi
ewed
for
poss
ible
reve
rsal
at e
ach
repo
rtin
g da
te.
A p
revi
ousl
y re
cogn
ized
impa
irmen
t los
s is
reve
rsed
if th
ere
has
been
a c
hang
e in
the
estim
ates
use
d to
det
erm
ine
the
reco
vera
ble
amou
nt.
Reve
rsal
of a
pre
vi-
ousl
y re
cogn
ized
impa
irmen
t is
limite
d to
an
am
ount
that
wou
ld m
ake
the
carr
ying
va
lue
of th
e as
set e
qual
to w
hat i
t w
ould
ha
ve b
een
had
the
initi
al im
pairm
ent
char
ge n
ot o
ccur
red.
1.11
Inta
ngib
le a
sset
s
Inta
ngib
le a
sset
s th
at a
re a
cqui
red
sepa
-ra
tely
are
mea
sure
d on
initi
al re
cogn
ition
at
cos
t. T
he c
ost o
f int
angi
ble
asse
ts
acqu
ired
in a
bus
ines
s co
mbi
natio
n is
re
cogn
ized
at f
air v
alue
at t
he d
ate
of
acqu
isiti
on.
Follo
win
g in
itial
reco
gniti
on,
inta
ngib
le a
sset
s ar
e ca
rrie
d at
cos
t les
s
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
437
any
accu
mul
ated
am
ortiz
atio
n an
d an
y ac
-cu
mul
ated
impa
irmen
t los
ses.
Int
erna
lly-
gene
rate
d in
tang
ible
ass
ets,
exc
ludi
ng
capi
taliz
ed d
evel
opm
ent c
osts
, are
not
ca
pita
lized
and
exp
endi
ture
is c
harg
ed
agai
nst p
rofit
s in
the
year
in w
hich
the
expe
nditu
re is
incu
rred
. Th
e us
eful
live
s of
inta
ngib
le a
sset
s ar
e as
sess
ed to
be
eith
er fi
nite
or i
ndefi
nite
. In
tang
ible
as-
sets
with
fini
te li
ves
are
amor
tized
ove
r th
e us
eful
eco
nom
ic li
fe a
nd a
sses
sed
for i
mpa
irmen
t whe
neve
r the
re is
an
indi
catio
n th
at th
e in
tang
ible
ass
et m
ay
be im
paire
d. T
he a
mor
tizat
ion
perio
d an
d th
e am
ortiz
atio
n m
etho
d ar
e re
view
ed
annu
ally
. Cha
nges
in th
e ex
pect
ed u
sefu
l lif
e or
the
expe
cted
pat
tern
of c
onsu
mp-
tion
of fu
ture
eco
nom
ic b
enefi
ts e
mbo
died
in
the
asse
t is
acco
unte
d fo
r by
chan
ging
th
e am
ortiz
atio
n pe
riod
or m
etho
d, a
s ap
prop
riate
, and
trea
ted
as a
cha
nge
in
acco
untin
g es
timat
e. T
he a
mor
tizat
ion
ex-
pens
e on
inta
ngib
le a
sset
s w
ith fi
nite
live
s is
reco
gniz
ed in
the
inco
me
stat
emen
t in
the
expe
nse
cate
gory
con
sist
ent w
ith th
e fu
nctio
n of
the
inta
ngib
le a
sset
.
Inta
ngib
le a
sset
s w
ith in
defin
ite u
sefu
l liv
es a
re te
sted
for i
mpa
irmen
t ann
ually
ei
ther
indi
vidu
ally
or a
t the
cas
h-ge
ner-
atin
g un
it le
vel.
Such
inta
ngib
les
are
not
amor
tized
. The
use
ful l
ife o
f an
inta
ngib
le
asse
t with
an
inde
finite
life
is re
view
ed a
n-nu
ally
to d
eter
min
e w
heth
er th
e in
defin
ite
life
asse
ssm
ent c
ontin
ues
to b
e su
ppor
t-ab
le. I
f not
, the
cha
nge
in th
e us
eful
life
as
sess
men
t fro
m in
defin
ite to
fini
te is
m
ade
on a
pro
spec
tive
basi
s.
Goo
dwill
- G
oodw
ill a
rises
on
the
acqu
isi-
tion
of s
ubsi
diar
ies
and
repr
esen
ts th
e ex
cess
of t
he c
onsi
dera
tion
tran
sfer
red,
th
e am
ount
of a
ny n
on-c
ontr
ollin
g in
tere
st
in th
e ac
quire
e an
d th
e ac
quis
ition
-dat
e fa
ir va
lue
of a
ny p
revi
ous
equi
ty in
tere
st
in th
e ac
quire
e ov
er th
e fa
ir va
lue
of th
e id
entifi
able
net
ass
ets
acqu
ired.
If th
e to
tal
of c
onsi
dera
tion
tran
sfer
red,
non
-con
trol
-lin
g in
tere
st re
cogn
ized
and
pre
viou
sly
held
inte
rest
mea
sure
d at
fair
valu
e is
less
th
an th
e fa
ir va
lue
of th
e ne
t ass
ets
of th
e su
bsid
iary
acq
uire
d, in
the
case
of a
bar
-
gain
pur
chas
e, th
e di
ffer
ence
is re
cogn
ized
di
rect
ly in
the
inco
me
stat
emen
t.
For t
he p
urpo
se o
f im
pairm
ent t
estin
g,
good
will
acq
uire
d in
a b
usin
ess
com
bi-
natio
n is
allo
cate
d to
eac
h of
the
CG
Us,
or
gro
ups
of C
GU
s, th
at is
exp
ecte
d to
be
nefit
from
the
syne
rgie
s of
the
com
bina
-tio
n. E
ach
unit
or g
roup
of u
nits
to w
hich
th
e go
odw
ill is
allo
cate
d re
pres
ents
the
low
est l
evel
with
in th
e en
tity
at w
hich
the
good
will
is m
onito
red
for i
nter
nal m
an-
agem
ent p
urpo
ses.
Goo
dwill
is m
onito
red
at th
e op
erat
ing
segm
ent l
evel
.
Goo
dwill
impa
irmen
t rev
iew
s ar
e un
-de
rtak
en a
nnua
lly o
r mor
e fr
eque
ntly
if
even
ts o
r cha
nges
in c
ircum
stan
ces
indi
cate
a p
oten
tial i
mpa
irmen
t. Th
e ca
r-ry
ing
valu
e of
goo
dwill
is c
ompa
red
to th
e re
cove
rabl
e am
ount
, whi
ch is
the
high
er o
f va
lue
in u
se a
nd th
e fa
ir va
lue
less
cos
ts
to s
ell.
Any
impa
irmen
t is
reco
gniz
ed
imm
edia
tely
as
an e
xpen
se a
nd is
not
su
bseq
uent
ly re
vers
ed.
Trad
emar
ks a
nd li
cens
es -
Sepa
rate
ly a
c-qu
ired
trad
emar
ks a
nd li
cens
es a
re s
how
n at
his
toric
al c
ost.
Trad
emar
ks a
nd li
-ce
nses
acq
uire
d in
a b
usin
ess
com
bina
tion
are
reco
gniz
ed a
t fai
r val
ue a
t the
acq
uisi
-tio
n da
te. T
rade
mar
ks a
nd li
cens
es h
ave
a fin
ite u
sefu
l life
and
are
mea
sure
d at
cos
t le
ss a
ccum
ulat
ed a
mor
tizat
ion.
Am
ortiz
a-tio
n is
cal
cula
ted
usin
g th
e st
raig
ht-l
ine
met
hod
to a
lloca
te th
e co
st o
f tra
dem
arks
an
d lic
ense
s ov
er th
eir e
stim
ated
use
ful
lives
of
thre
e to
sev
en y
ears
.
Rese
arch
and
dev
elop
men
t - R
esea
rch
and
Dev
elop
men
t (R&
D) r
elat
es to
the
deve
lopm
ent o
f a p
rodu
ctio
n m
etho
d fo
r dr
illin
g pr
oces
s; th
is R
&D
is p
art o
f the
O
ther
Seg
men
t.
1.12
Fin
anci
al a
sset
s
1.12
.1 C
lass
ifica
tion
The
Com
pany
cla
ssifi
es it
s fin
anci
al
asse
ts in
the
follo
win
g tw
o ca
tego
ries:
Fi-
nanc
ial a
sset
s at
fair
valu
e th
roug
h pr
ofit
or lo
ss a
nd L
oans
and
rece
ivab
les.
The
cl
assi
ficat
ion
depe
nds
on th
e pu
rpos
e fo
r
whi
ch th
e fin
anci
al a
sset
s w
ere
acqu
ired.
M
anag
emen
t det
erm
ines
the
clas
sific
atio
n of
its
finan
cial
ass
ets
at in
itial
reco
gniti
on
and
re-e
valu
ates
this
des
igna
tion
at e
very
re
port
ing
date
.
(a) F
inan
cial
ass
ets
at fa
ir va
lue
thro
ugh
profi
t or l
oss
Fina
ncia
l ass
ets
at fa
ir va
lue
thro
ugh
profi
t or l
oss
are
finan
cial
ass
ets
held
for
trad
ing.
The
onl
y fin
anci
al a
sset
s in
this
ca
tego
ry a
re d
eriv
ativ
e co
ntra
cts,
whi
ch
are
cate
goriz
ed a
s he
ld fo
r tra
ding
unl
ess
desi
gnat
ed a
s he
dges
. Der
ivat
ives
in th
is
cate
gory
are
cla
ssifi
ed a
s cu
rren
t ass
ets.
(b) L
oans
and
rece
ivab
les
Loan
s an
d re
ceiv
able
s ar
e no
n-de
rivat
ive
finan
cial
ass
ets
with
fixe
d or
det
erm
inab
le
paym
ents
that
are
not
quo
ted
in a
n ac
-tiv
e m
arke
t. Th
ey a
re in
clud
ed in
cur
rent
as
sets
, exc
ept f
or a
sset
s w
ith m
atur
ities
gr
eate
r tha
n 12
mon
ths
afte
r the
repo
rtin
g da
te. T
hese
are
cla
ssifi
ed a
s no
n-cu
rren
t fin
anci
al a
sset
s. T
he C
ompa
ny’s
loan
s an
d re
ceiv
able
s in
clud
e ac
coun
ts re
ceiv
-ab
le, c
ash,
sho
rt a
nd lo
ng-t
erm
fina
ncia
l re
ceiv
able
s an
d th
e C
IRR
loan
dep
osit.
1.12
.2 R
ecog
nitio
n an
d m
easu
rem
ent
Regu
lar p
urch
ases
and
sal
es o
f fina
ncia
l as
sets
are
reco
gniz
ed o
n th
e tr
ade-
date
–
the
date
on
whi
ch th
e C
ompa
ny c
omm
its
to p
urch
ase
or s
ell t
he a
sset
. Inv
estm
ents
ar
e in
itial
ly re
cogn
ized
at f
air v
alue
plu
s tr
ansa
ctio
n co
sts
for a
ll fin
anci
al a
sset
s no
t car
ried
at fa
ir va
lue
thro
ugh
profi
t or
loss
. Fin
anci
al a
sset
s ca
rrie
d at
fair
valu
e th
roug
h pr
ofit o
r los
s ar
e in
itial
ly re
cog-
nize
d at
fair
valu
e, a
nd tr
ansa
ctio
n co
sts
are
expe
nsed
in th
e in
com
e st
atem
ent.
Fina
ncia
l ass
ets
are
dere
cogn
ized
whe
n th
e rig
hts
to re
ceiv
e ca
sh fl
ows
from
the
inve
stm
ents
hav
e ex
pire
d or
hav
e be
en
tran
sfer
red
and
the
Com
pany
has
tran
s-fe
rred
sub
stan
tially
all
risks
and
rew
ards
of
ow
ners
hip.
Loa
ns a
nd re
ceiv
able
s ar
e su
bseq
uent
ly c
arrie
d at
am
ortiz
ed c
ost
usin
g th
e ef
fect
ive
inte
rest
met
hod.
Gai
ns o
r los
ses
aris
ing
from
cha
nges
in
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
438
NO
TES
TO
TH
E A
CC
OU
NTS
the
fair
valu
e of
the
‘fina
ncia
l ass
ets
at fa
ir va
lue
thro
ugh
profi
t or l
oss’
cat
egor
y ar
e pr
esen
ted
in th
e in
com
e st
atem
ent w
ithin
O
pera
ting
profi
t as
Gai
n/(L
oss)
on
cur-
renc
y cu
rren
cy d
eriv
ativ
e co
ntra
cts
and
with
in n
et fi
nanc
ial i
tem
s fo
r the
inte
rest
ra
te a
nd c
ross
cur
renc
y sw
ap d
eriv
ativ
e co
ntra
cts.
See
for n
ote
21 fo
r add
ition
al
info
rmat
ion.
1.13
Off
sett
ing
finan
cial
inst
rum
ents
Fina
ncia
l ass
ets
and
liabi
litie
s ar
e of
fset
an
d th
e ne
t am
ount
repo
rted
in th
e ba
lanc
e sh
eet w
hen
ther
e is
a le
gally
en
forc
eabl
e rig
ht to
off
set t
he re
cogn
ized
am
ount
s an
d th
ere
is a
n in
tent
ion
to s
ettl
e on
a n
et b
asis
or r
ealiz
e th
e as
set a
nd s
et-
tle
the
liabi
lity
sim
ulta
neou
sly.
The
lega
lly
enfo
rcea
ble
right
mus
t not
be
cont
inge
nt
on fu
ture
eve
nts
and
mus
t be
enfo
rce-
able
in th
e no
rmal
cou
rse
of b
usin
ess
and
in th
e ev
ent o
f def
ault,
inso
lven
cy
or b
ankr
uptc
y of
the
com
pany
or t
he c
oun-
terp
arty
. The
Com
pany
has
eva
luat
ed a
ll of
thei
r der
ivat
ive
cont
ract
pos
ition
s an
d do
es n
ot c
urre
ntly
hav
e th
e rig
ht to
off
set
the
cont
ract
s, a
nd th
eref
ore
repo
rts
all
deriv
ativ
e po
sitio
ns a
t gro
ss a
mou
nts.
1.14
Inve
ntor
ies
Lubr
icat
ing
oil a
nd b
unke
rs in
vent
orie
s ar
e va
lued
at t
he lo
wer
of c
ost a
nd n
et re
aliz
-ab
le v
alue
. Cos
t is
dete
rmin
ed u
sing
the
wei
ghte
d av
erag
e co
st m
etho
d. B
unke
rs
and
lubr
icat
ing
oil i
nven
torie
s ar
e an
inte
-gr
al p
art o
f the
ves
sel,
and
not s
old
sepa
-ra
tely
. Net
real
izab
le v
alue
is e
stim
ated
ba
sed
on c
omm
odity
mar
ket p
rices
.
1.15
Cas
h an
d ca
sh e
quiv
alen
ts
In th
e st
atem
ent o
f cas
h flo
ws,
cas
h an
d ca
sh e
quiv
alen
ts in
clud
es c
ash
in h
and
and
othe
r sho
rt-t
erm
hig
hly-
liqui
d in
vest
-m
ents
with
orig
inal
mat
uriti
es o
f thr
ee
mon
ths
or le
ss.
Cas
h an
d ca
sh e
quiv
alen
ts in
the
Stat
e-m
ent o
f cas
h flo
ws
excl
udes
rest
ricte
d ca
sh b
alan
ces.
1.16
Acc
ount
s re
ceiv
able
Acc
ount
s re
ceiv
able
are
reco
gniz
ed
initi
ally
at f
air v
alue
and
sub
sequ
ently
m
easu
red
at a
mor
tized
cos
t, le
ss p
rovi
-si
on fo
r im
pairm
ent.
The
inte
rest
fact
or
for a
ccou
nts
rece
ivab
le is
con
side
red
to
be in
sign
ifica
nt a
nd th
eref
ore
not i
nclu
ded
in th
e m
easu
rem
ent o
f am
ortiz
ed c
ost.
In
the
case
of a
n ob
ject
ive
evid
ence
of a
fall
in v
alue
, the
diff
eren
ce b
etw
een
repo
rted
va
lue
and
the
pres
ent v
alue
of t
he e
x-pe
cted
net
futu
re c
ash
flow
s is
repo
rted
as
a lo
ss.
Prov
isio
ns fo
r los
ses
are
reco
gniz
ed
whe
n th
ere
are
obje
ctiv
e in
dica
tors
that
th
e C
ompa
ny w
ill n
ot re
ceiv
e se
ttle
men
t in
acc
orda
nce
with
the
orig
inal
con
trac
t te
rms.
Sig
nific
ant fi
nanc
ial p
robl
ems
faci
ng th
e cu
stom
er, p
roba
bilit
y th
at th
e cu
stom
er w
ill g
o ba
nkru
pt o
r und
ergo
fi-
nanc
ial r
estr
uctu
ring,
pos
tpon
emen
ts a
nd
non-
paym
ent a
re re
gard
ed a
s in
dica
tors
th
at th
e cu
stom
er re
ceiv
able
is im
paire
d.
1.17
Sha
re c
apit
al
Ord
inar
y sh
ares
are
cla
ssifi
ed a
s eq
uity
. In
crem
enta
l cos
ts d
irect
ly a
ttrib
utab
le
to th
e is
sue
of n
ew s
hare
s or
opt
ions
are
sh
own
in e
quity
as
a de
duct
ion,
net
of t
ax,
from
the
proc
eeds
. Whe
n an
y C
ompa
ny
entit
y pu
rcha
ses
its o
wn
shar
es, t
he
cons
ider
atio
n pa
id, i
nclu
ding
any
dire
ctly
at
trib
utab
le in
crem
enta
l cos
ts (n
et o
f in
com
e ta
xes)
, is
dedu
cted
as
appr
opria
te
from
sha
re c
apita
l and
sha
re p
rem
ium
re
serv
e an
d th
e sh
ares
are
can
celle
d.
1.18
Bor
row
ings
Borr
owin
gs a
re re
cogn
ized
initi
ally
at f
air
valu
e, n
et o
f tra
nsac
tion
cost
s in
curr
ed
and
are
subs
eque
ntly
sta
ted
at a
mor
tized
co
st. A
ny d
iffer
ence
bet
wee
n th
e pr
ocee
ds
(net
of t
rans
actio
n co
sts)
and
the
rede
mp-
tion
valu
e is
reco
gniz
ed in
the
inco
me
stat
emen
t ove
r the
per
iod
of th
e bo
rrow
-in
gs u
sing
the
effe
ctiv
e in
tere
st m
etho
d.
Borr
owin
gs a
re c
lass
ified
as
curr
ent
liabi
litie
s un
less
the
Com
pany
has
an
unco
nditi
onal
righ
t to
defe
r set
tlem
ent o
f
the
liabi
lity
for a
t lea
st 1
2 m
onth
s af
ter
the
repo
rtin
g da
te.
1.19
Com
mer
cial
Inte
rest
Ref
eren
ce
Rat
e (C
IRR
) loa
n
The
Com
pany
has
app
lied
for t
hree
C
omm
erci
al In
tere
st R
efer
ence
Rat
e (C
IRR)
loan
s fr
om th
e N
orw
egia
n Ex
port
C
redi
t Age
ncy.
The
dur
atio
n of
the
loan
s is
12
year
s an
d th
e ca
sh p
roce
eds
from
th
e lo
ans
have
bee
n de
posi
ted
in a
fixe
d de
posi
t acc
ount
with
a N
orw
egia
n ba
nk a
t th
e sa
me
inte
rest
rate
as
the
loan
s. T
he
agre
ed p
erio
ds o
f the
dep
osits
are
iden
ti-ca
l with
the
perio
ds o
f the
loan
s.
1.20
Tax
atio
n
The
tax
expe
nse
for t
he p
erio
d co
mpr
ises
cu
rren
t and
def
erre
d ta
x. T
ax is
reco
gniz
ed
in th
e in
com
e st
atem
ent,
exce
pt to
the
exte
nt th
at it
rela
tes
to it
ems
reco
gniz
ed
in o
ther
com
preh
ensi
ve in
com
e or
dire
ctly
in
equ
ity. I
n th
is c
ase,
the
tax
is a
lso
rec-
ogni
zed
in o
ther
com
preh
ensi
ve in
com
e or
di
rect
ly in
equ
ity, r
espe
ctiv
ely.
Tax
expe
nse/
bene
fit in
clud
es c
urre
nt
taxe
s an
d th
e ch
ange
in d
efer
red
taxe
s.
Def
erre
d in
com
e ta
x is
pro
vide
d fo
r all
tem
pora
ry d
iffer
ence
s be
twee
n th
e bo
ok v
alue
and
the
tax
basi
s of
ass
ets
and
liabi
litie
s an
d fo
r tax
loss
es c
arrie
d fo
rwar
d. D
efer
red
tax
asse
ts m
ade
prob
-ab
le th
roug
h pr
ospe
ctiv
e ea
rnin
gs th
at
can
be u
tiliz
ed a
gain
st th
e ta
x re
duci
ng
tem
pora
r y d
iffer
ence
s ar
e re
cogn
ized
as
inta
ngib
le a
sset
s. D
efer
red
tax
asse
ts a
nd
defe
rred
tax
liabi
litie
s ar
e re
cogn
ized
inde
-pe
nden
tly o
f whe
n th
e di
ffer
ence
s w
ill b
e re
vers
ed a
nd, a
s a
rule
, at n
omin
al v
alue
. D
efer
red
tax
asse
ts a
nd ta
x lia
bilit
ies
are
mea
sure
d on
the
basi
s of
est
imat
ed fu
ture
ta
x ra
te.
Part
of t
he C
ompa
ny’s
act
iviti
es u
nder
the
Nor
weg
ian
subs
idia
ries
are
stru
ctur
ed to
be
in c
ompl
ianc
e w
ith th
e re
gula
tions
for
the
Nor
weg
ian
Tonn
age
Tax
Regi
me.
The
C
ompa
ny h
as e
stim
ated
a ta
x ra
te o
f 0%
fo
r the
com
pani
es s
ubje
ct to
Nor
weg
ian
Tonn
age
Tax
Regi
me.
Fin
anci
al in
com
e
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
439
with
in th
e re
gim
e is
taxa
ble
at a
rate
of
27%
. For
com
pani
es n
ot in
clud
ed in
the
tonn
age
tax
regi
me,
the
Com
pany
ap-
plie
s a
tax
rate
of 2
7%. T
he ta
x ex
pens
e co
nsis
ts o
f tax
es p
ayab
le a
nd c
hang
es in
de
ferr
ed ta
x as
sets
/lia
bilit
ies.
Def
erre
d in
com
e ta
x is
reco
gniz
ed o
n te
mpo
rary
diff
eren
ces
aris
ing
betw
een
the
tax
base
s of
ass
ets
and
liabi
litie
s an
d th
eir c
arry
ing
amou
nts
in th
e co
nsol
idat
ed
finan
cial
sta
tem
ents
. Def
erre
d in
com
e ta
x is
det
erm
ined
usi
ng ta
x ra
tes
(and
law
s)
that
hav
e be
en e
nact
ed o
r sub
stan
tivel
y en
acte
d by
the
bala
nce
shee
t dat
e an
d ar
e ex
pect
ed to
app
ly w
hen
the
rela
ted
defe
rred
inco
me
tax
asse
t is
real
ized
or
the
defe
rred
inco
me
tax
liabi
lity
is s
ettl
ed.
Def
erre
d in
com
e ta
x as
sets
are
reco
g-ni
zed
only
to th
e ex
tent
that
it is
pro
babl
e th
at fu
ture
taxa
ble
profi
t will
be
avai
labl
e ag
ains
t whi
ch th
e te
mpo
rary
diff
eren
ces
can
be u
tiliz
ed.
Def
erre
d in
com
e ta
x lia
bilit
ies
are
prov
id-
ed o
n ta
xabl
e te
mpo
rary
diff
eren
ces
aris
-in
g fr
om in
vest
men
ts in
sub
sidi
arie
s an
d as
soci
ates
, exc
ept f
or d
efer
red
inco
me
tax
liabi
lity
whe
re th
e tim
ing
of th
e re
vers
al
of th
e te
mpo
rary
diff
eren
ce is
con
trol
led
by th
e C
ompa
ny a
nd it
is p
roba
ble
that
th
e te
mpo
rary
diff
eren
ce w
ill n
ot re
vers
e in
the
fore
seea
ble
futu
re. G
ener
ally
the
Com
pany
is u
nabl
e to
con
trol
the
reve
rsal
of
the
tem
pora
ry d
iffer
ence
for a
ssoc
iate
s.
Def
erre
d in
com
e ta
x as
sets
are
reco
g-ni
zed
on d
educ
tible
tem
pora
ry d
iffer
ence
s ar
isin
g fr
om in
vest
men
ts in
sub
sidi
arie
s an
d as
soci
ates
onl
y to
the
exte
nt th
at it
is
pro
babl
e th
e te
mpo
rary
diff
eren
ce w
ill
reve
rse
in th
e fu
ture
and
ther
e is
suf
ficie
nt
taxa
ble
profi
t ava
ilabl
e ag
ains
t whi
ch th
e te
mpo
rary
diff
eren
ce c
an b
e ut
ilize
d.
Def
erre
d in
com
e ta
x as
sets
and
liab
ilitie
s ar
e of
fset
whe
n th
ere
is a
lega
lly e
nfor
ce-
able
righ
t to
offs
et c
urre
nt ta
x as
sets
ag
ains
t cur
rent
tax
liabi
litie
s an
d w
hen
the
defe
rred
inco
me
taxe
s as
sets
and
lia
bilit
ies
rela
te to
inco
me
taxe
s le
vied
by
the
sam
e ta
xatio
n au
thor
ity o
n ei
ther
the
sam
e ta
xabl
e en
tity
or d
iffer
ent t
axab
le
entit
ies
whe
re th
ere
is a
n in
tent
ion
to s
et-
tle
the
bala
nces
on
a ne
t bas
is.
1.21
Pen
sion
cos
ts a
nd o
blig
atio
ns
The
Com
pany
has
a d
efine
d be
nefit
pla
n fo
r its
em
ploy
ees
in N
orw
ay.
The
pens
ion
sche
me
is fi
nanc
ed th
roug
h co
ntrib
utio
ns
to in
sura
nce
com
pani
es o
r pen
sion
fund
s.
A d
efine
d be
nefit
pla
n de
fines
the
amou
nt
of p
ensi
on b
enefi
t tha
t an
empl
oyee
will
re
ceiv
e on
retir
emen
t, us
ually
dep
ende
nt
on o
ne o
r mor
e fa
ctor
s su
ch a
s ag
e, y
ears
of
ser
vice
and
com
pens
atio
n.
The
liabi
lity
reco
gniz
ed in
the
stat
emen
t of
fina
ncia
l pos
ition
rela
ting
to d
efine
d be
nefit
pla
ns is
the
pres
ent v
alue
of t
he
defin
ed b
enefi
t obl
igat
ion
at th
e en
d of
th
e re
port
ing
perio
d le
ss th
e fa
ir va
lue
of th
e pe
nsio
n fu
nd a
sset
s. T
he d
efine
d be
nefit
obl
igat
ion
is c
alcu
late
d an
nual
ly
by a
n in
depe
nden
t act
uary
on
the
basi
s of
a
linea
r mod
el. T
he p
rese
nt v
alue
of t
he
defin
ed b
enefi
t obl
igat
ion
is d
eter
min
ed
by d
isco
untin
g th
e es
timat
ed fu
ture
cas
h ou
tflow
s ba
sed
on th
e in
tere
st ra
te fo
r N
orw
egia
n go
vern
men
t bon
ds. S
ince
N
orw
egia
n go
vern
men
t bon
ds a
re n
ot
issu
ed fo
r ter
ms
exce
edin
g 10
yea
rs, a
su
pple
men
t to
this
bon
d ra
te is
cal
cula
ted
by m
eans
of e
stim
atio
n te
chni
ques
to
esta
blis
h a
disc
ount
rate
that
is a
ppro
xi-
mat
ely
the
sam
e as
the
term
of t
he p
en-
sion
obl
igat
ion.
Past
ser
vice
cos
ts a
re re
cogn
ized
im
med
iate
ly in
inco
me.
Act
uaria
l gai
ns a
nd lo
sses
aris
ing
from
ex
perie
nce
adju
stm
ents
and
cha
nges
in
actu
aria
l ass
umpt
ions
are
cha
rged
or
cred
ited
to e
quity
in o
ther
com
preh
ensi
ve
inco
me
in th
e pe
riod
in w
hich
they
aris
e.
1.22
Der
ivat
ive
finan
cial
inst
rum
ents
an
d he
dgin
g ac
tivi
ties
The
Com
pany
ent
ers
into
der
ivat
ive
inst
ru-
men
ts, p
rimar
ily fo
reig
n cu
rren
cy c
on-
trac
ts a
nd in
tere
st ra
te s
wap
s, to
hed
ge
fore
ign
curr
ency
exp
osur
es, f
or e
xam
ple
rela
ted
to o
pera
ting
expe
nses
and
ves
sel
purc
hase
com
mitm
ents
, and
inte
rest
rate
ex
posu
res
prim
arily
rela
ted
to lo
ng-t
erm
bo
rrow
ings
. The
se d
eriv
ativ
es a
re n
ot
desi
gnat
ed a
s ac
coun
ting
hedg
es.
Der
ivat
ives
are
initi
ally
reco
gniz
ed a
t fai
r va
lue
on th
e da
te a
der
ivat
ive
cont
ract
is
ent
ered
into
and
are
sub
sequ
ently
re-
mea
sure
d at
thei
r fai
r val
ue. T
he m
etho
d of
reco
gniz
ing
the
resu
lting
gai
n or
loss
de
pend
s on
whe
ther
the
deriv
ativ
e is
des
-ig
nate
d as
a h
edgi
ng in
stru
men
t, an
d if
so,
the
natu
re o
f the
item
bei
ng h
edge
d.
Man
agem
ent d
esig
nate
s ce
rtai
n de
-riv
ativ
es a
s he
dges
of a
par
ticul
ar ri
sk
asso
ciat
ed w
ith a
hig
hly
prob
able
fore
cast
tr
ansa
ctio
n (c
ash
flow
hed
ge),
spec
ifi-
cally
the
cont
ract
ual f
utur
e sa
les
rela
ted
to v
esse
ls c
hart
ered
by
the
Braz
ilian
su
bsid
iary
. The
Bra
zilia
n en
tity
docu
men
ts
at th
e in
cept
ion
of th
e tr
ansa
ctio
n th
e re
latio
nshi
p be
twee
n th
e fo
reig
n cu
rren
cy
deriv
ativ
es (h
edgi
ng in
stru
men
t) a
nd th
e he
dged
item
s (h
ighl
y pr
obab
le fu
ture
sa
les)
, as
wel
l as
its ri
sk m
anag
emen
t ob-
ject
ives
and
str
ateg
y fo
r und
erta
king
the
vario
us h
edgi
ng tr
ansa
ctio
ns. T
he e
ntity
al
so d
ocum
ents
its
asse
ssm
ent,
both
at
hedg
e in
cept
ion
and
on a
n on
goin
g ba
sis,
of
whe
ther
the
deriv
ativ
es th
at a
re u
sed
in
the
hedg
ing
tran
sact
ions
are
hig
hly
effe
c-tiv
e in
off
sett
ing
chan
ges
in fa
ir va
lues
or
cash
flow
s of
hed
ged
item
s.
The
fair
valu
es o
f the
fore
ign
curr
ency
de
rivat
ive
inst
rum
ents
use
d fo
r hed
ging
pu
rpos
es a
re d
iscl
osed
in n
ote
15. M
ove-
men
ts o
n th
e he
dgin
g re
serv
e in
oth
er
com
preh
ensi
ve in
com
e ar
e sh
own
in n
ote
15. T
he fu
ll fa
ir va
lue
of a
hed
ging
der
iva-
tive
is c
lass
ified
as
a no
n-cu
rren
t ass
et o
r lia
bilit
y w
hen
the
rem
aini
ng h
edge
d ite
m
is m
ore
than
12
mon
ths,
and
as
a cu
rren
t as
set o
r lia
bilit
y w
hen
the
rem
aini
ng
mat
urity
of t
he h
edge
d ite
m is
less
than
12
mon
ths.
The
effe
ctiv
e po
rtio
n of
cha
nges
in th
e fa
ir va
lue
of d
eriv
ativ
es th
at a
re d
esig
nate
d
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
440
NO
TES
TO
TH
E A
CC
OU
NTS
and
qual
ify a
s ca
sh fl
ow h
edge
s is
rec-
ogni
zed
in o
ther
com
preh
ensi
ve in
com
e.
The
gain
or l
oss
rela
ting
to th
e in
effe
ctiv
e po
rtio
n is
reco
gniz
ed im
med
iate
ly in
the
inco
me
stat
emen
t.
Am
ount
s ac
cum
ulat
ed in
equ
ity a
re
recl
assi
fied
to p
rofit
or l
oss
in th
e pe
riods
w
hen
the
fore
cast
sal
e th
at is
hed
ged
take
s pl
ace.
Whe
n a
hedg
ing
inst
ru-
men
t exp
ires
or is
sol
d, o
r whe
n a
hedg
e no
long
er m
eets
the
crite
ria fo
r hed
ge
acco
untin
g, a
ny c
umul
ativ
e ga
in o
r los
s ex
istin
g in
equ
ity a
t tha
t tim
e re
mai
ns in
eq
uity
and
is re
cogn
ized
whe
n th
e fo
reca
st
tran
sact
ion
is u
ltim
atel
y re
cogn
ized
in th
e
profi
t or l
oss.
Whe
n a
fore
cast
tran
sac-
tion
is n
o lo
nger
exp
ecte
d to
occ
ur, t
he
cum
ulat
ive
gain
or l
oss
that
was
repo
rted
in
equ
ity is
imm
edia
tely
tran
sfer
red
to
the
inco
me
stat
emen
t with
in O
pera
ting
Mar
gin.
1.23
Rev
enue
rec
ogni
tion
The
Com
pany
’s a
ctiv
ity is
to e
mpl
oy d
if-fe
rent
type
s of
off
shor
e su
ppor
t ves
sels
, in
clud
ing
PSVs
, OSC
Vs, A
HTS
ves
sels
, O
SRVs
, sta
ndby
ves
sels
and
cre
w-b
oats
an
d on
e sc
ient
ific
core
-dril
ling
vess
el.
In a
dditi
on, t
he C
ompa
ny h
olds
inte
r-es
t in
one
limite
d lia
bilit
y pa
rtne
rshi
p w
ith o
wne
rshi
p in
one
wel
l-st
imul
atio
n ve
ssel
. In
one
of th
e su
bsid
iarie
s of
the
Com
pany
, rev
enue
s ar
e pa
rtly
gen
erat
ed
from
inco
me
from
con
stru
ctio
n co
ntra
cts.
Re
venu
e co
mpr
ises
the
fair
valu
e of
the
cons
ider
atio
n re
ceiv
ed o
r rec
eiva
ble
for
the
sale
of g
oods
and
ser
vice
s in
the
ordi
nary
cou
rse
of th
e C
ompa
ny’s
act
ivi-
ties.
Rev
enue
is s
how
n ne
t of v
alue
-add
ed
tax,
with
hold
ing
tax,
retu
rns,
reba
tes
and
disc
ount
s an
d af
ter e
limin
atio
n of
sal
es
with
in th
e C
ompa
ny. R
even
ue is
reco
g-ni
zed
as fo
llow
s:
Cha
rter
rate
con
trac
ts
Cha
rter
con
trac
ts a
re c
lass
ified
as
oper
at-
ing
leas
es u
nder
IAS
17. R
even
ue d
eriv
ed
from
cha
rter
con
trac
ts is
reco
gniz
ed in
the
perio
d ov
er th
e le
ase
term
on
a st
raig
ht-
line
basi
s. R
elat
ed s
ervi
ces
are
reco
g-
nize
d as
reve
nue
in a
ccor
danc
e w
ith th
e se
rvic
es b
eing
rend
ered
.
Reve
nues
from
tim
e ch
arte
rs a
nd b
are-
boat
cha
rter
s ac
coun
ted
for a
s op
erat
ing
leas
es a
re re
cogn
ized
ove
r the
rent
al
perio
ds o
f suc
h ch
arte
rs, a
s se
rvic
e is
pe
rfor
med
on
a st
raig
ht-l
ine
basi
s. C
erta
in
cont
ract
s in
clud
e m
obili
zatio
n fe
es p
ay-
able
at t
he s
tart
of t
he c
ontr
act,
and
are
reco
gniz
ed a
s re
venu
e in
the
mob
iliza
-tio
n pe
riod
until
con
trac
t com
men
ce-
men
t. In
cas
es w
here
the
fee
cove
rs
spec
ific
upgr
ades
or e
quip
men
t spe
cific
to
the
cont
ract
, the
mob
iliza
tion
fees
are
re
cogn
ized
as
reve
nue
over
the
estim
ated
co
ntra
ct p
erio
d. T
he re
late
d in
vest
men
t is
depr
ecia
ted
over
the
estim
ated
con
trac
t pe
riod.
In c
ases
whe
re th
e fe
e co
vers
sp
ecifi
c op
erat
ing
expe
nses
at t
he s
tart
of
the
cont
ract
, the
fees
are
reco
gniz
ed in
th
e sa
me
perio
d as
the
expe
nses
.
Vess
els
with
out s
igne
d co
ntra
cts
in p
lace
at
dis
char
ge h
ave
no re
venu
e un
til th
e si
gnin
g of
a n
ew c
ontr
act.
Cha
rter
-rel
ated
ex
pens
es fo
r ves
sels
dur
ing
idle
tim
e ar
e ex
pens
ed a
s in
curr
ed.
Con
stru
ctio
n co
ntra
cts
The
Com
pany
acc
ount
s fo
r lon
g-te
rm c
on-
stru
ctio
n, e
ngin
eerin
g an
d pr
ojec
t man
-ag
emen
t con
trac
ts o
n th
e pe
rcen
tage
-of-
com
plet
ion
basi
s as
cos
ts a
re in
curr
ed.
Und
er th
is m
etho
d, w
hen
the
outc
ome
of
a co
nstr
uctio
n co
ntra
ct c
an b
e es
timat
ed
relia
bly
and
it is
pro
babl
y th
at th
e co
ntra
ct
will
be
profi
tabl
e, c
ontr
act r
even
ue is
rec-
ogni
zed
over
the
perio
d of
the
cont
ract
by
refe
renc
e to
the
stag
e of
com
plet
ion.
In th
e be
ginn
ing
phas
e of
a p
roje
ct, t
he
profi
t on
a co
ntra
ct is
not
abl
e to
be
esti-
mat
ed re
liabl
y un
til p
rogr
ess
has
reac
hed
at le
ast 2
5% c
ompl
etio
n. T
here
fore
, unt
il an
est
imat
e of
25%
com
plet
e is
pos
sibl
e,
only
con
trac
t exp
ense
s ar
e re
cogn
ized
, bu
t no
profi
t mar
gin.
Con
trac
t cos
ts a
re
reco
gniz
ed a
s ex
pens
es b
y re
fere
nce
to
the
stag
e of
com
plet
ion
of th
e co
ntra
ct
activ
ity a
t the
end
of t
he re
port
ing
perio
d.
Whe
n it
is p
roba
ble
that
a p
roje
ct w
ill g
en-
erat
e a
loss
(tot
al c
ontr
act c
osts
are
ex-
pect
ed to
exc
eed
tota
l con
trac
t rev
enue
), th
e to
tal e
stim
ated
loss
is re
cogn
ized
as
an e
xpen
se im
med
iate
ly.
Inte
rest
inco
me
Inte
rest
inco
me
is re
cogn
ized
usi
ng th
e ef
-fe
ctiv
e in
tere
st m
etho
d. W
hen
a re
ceiv
able
is
impa
ired,
the
Com
pany
redu
ces
the
car-
ryin
g am
ount
to it
s re
cove
rabl
e am
ount
, w
hich
is d
eter
min
ed a
s th
e es
timat
ed
futu
re c
ash
flow
dis
coun
ted
at o
rigin
al e
f-fe
ctiv
e in
tere
st ra
te o
f the
inst
rum
ent a
nd
cont
inue
s un
win
ding
the
disc
ount
as
inte
r-es
t inc
ome.
Inte
rest
inco
me
on im
paire
d lo
ans
and
rece
ivab
les
is re
cogn
ized
usi
ng
the
orig
inal
eff
ectiv
e in
tere
st ra
te.
Div
iden
d in
com
e D
ivid
end
inco
me
is re
cogn
ized
whe
n th
e rig
ht to
rece
ive
paym
ent i
s es
tabl
ishe
d.
Rend
erin
g of
ser
vice
s Se
rvic
e re
venu
e is
gen
eral
ly re
cogn
ized
w
hen
a si
gned
con
trac
t or o
ther
per
sua-
sive
evi
denc
e of
an
arra
ngem
ent e
xist
s,
the
serv
ice
has
been
pro
vide
d, th
e fe
e is
fix
ed o
r det
erm
inab
le a
nd c
olle
ctio
n of
re
sulti
ng re
ceiv
able
s is
reas
onab
ly a
s-su
red.
Oth
er s
ervi
ces
are
reco
gniz
ed o
n a
perc
enta
ge-o
f-co
mpl
etio
n ba
sis.
1.24
Acc
ount
s pa
yabl
e
Acc
ount
s pa
yabl
es a
re o
blig
atio
ns to
pa
y fo
r goo
ds o
r ser
vice
s th
at h
ave
been
ac
quire
d in
the
ordi
nary
cou
rse
of b
usi-
ness
from
sup
plie
rs. A
ccou
nts
paya
ble
are
clas
sifie
d as
cur
rent
liab
ilitie
s if
paym
ent
is d
ue w
ithin
one
yea
r or l
ess
(or i
n th
e no
rmal
ope
ratin
g cy
cle
of th
e bu
sine
ss
if lo
nger
). If
not,
they
are
pre
sent
ed a
s no
n-cu
rren
t lia
bilit
ies.
Acc
ount
s pa
yabl
e ar
e re
cogn
ized
initi
ally
at f
air v
alue
and
su
bseq
uent
ly m
easu
red
at a
mor
tized
cos
t us
ing
the
effe
ctiv
e in
tere
st m
etho
d.
1.25
Ear
ning
s pe
r sh
are
Earn
ings
per
sha
re a
re c
alcu
late
d by
div
id-
ing
the
net p
rofit
/los
s fo
r sha
reho
lder
s of
the
Com
pany
by
the
wei
ghte
d av
erag
e
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
441
num
ber o
f out
stan
ding
sha
res
over
the
repo
rtin
g pe
riod.
Dilu
ted
earn
ings
per
sh
are
incl
ude
the
effe
ct o
f the
ass
umed
co
nver
sion
of p
oten
tially
dilu
tive
inst
ru-
men
ts s
uch
as e
mpl
oyee
sto
ck o
ptio
ns.
The
impa
ct o
f sha
re e
quiv
alen
ts is
com
-pu
ted
usin
g th
e tr
easu
ry s
tock
met
hod
for
stoc
k op
tions
.
1.26
Sta
tem
ent o
f Cas
h Fl
ows
The
Stat
emen
ts o
f cas
h flo
ws
are
prep
ared
in a
ccor
danc
e w
ith th
e in
dire
ct
met
hod.
1.27
Rel
ated
par
ty tr
ansa
ctio
ns
All
tran
sact
ions
, agr
eem
ents
and
bus
i-ne
ss a
ctiv
ities
with
rela
ted
part
ies
are
dete
rmin
ed o
n an
arm
’s le
ngth
bas
is in
a
man
ner s
imila
r to
tran
sact
ions
with
third
pa
rtie
s.
1. 2
8 G
over
nmen
t gra
nts
Gra
nts
rela
ting
to n
et w
ages
arr
ange
men
t in
Nor
way
are
reco
gniz
ed a
s a
redu
ctio
n of
w
age
cost
.
1.29
Ope
rati
ng le
ases
Leas
es in
whi
ch a
sig
nific
ant p
ortio
n of
th
e ris
ks a
nd re
war
ds o
f ow
ners
hip
have
no
t bee
n tr
ansf
erre
d to
the
Com
pany
are
cl
assi
fied
as o
pera
ting
leas
es. P
aym
ents
m
ade
unde
r ope
ratin
g le
ase
agre
emen
ts
are
clas
sifie
d in
the
inco
me
stat
emen
t as
ope
ratin
g ex
pens
es a
nd re
cogn
ized
st
raig
ht-l
ine
over
the
perio
d of
the
leas
e.
1.30
Sha
re-b
ased
pay
men
ts
The
Com
pany
ope
rate
s an
exe
cutiv
e m
anag
emen
t equ
ity-s
ettl
ed, s
hare
-ba
sed
com
pens
atio
n pl
an, u
nder
whi
ch
the
entit
y re
ceiv
es s
ervi
ces
from
ten
top
man
agem
ent e
mpl
oyee
s (e
ight
in 2
013)
as
con
side
ratio
n fo
r equ
ity in
stru
men
ts
(sha
re-o
ptio
ns) o
f the
Com
pany
. The
fair
valu
e of
the
empl
oyee
ser
vice
s re
ceiv
ed
in e
xcha
nge
for t
he g
rant
of t
he o
ptio
ns is
re
cogn
ized
as
an O
pera
ting
Expe
nse.
For
ad
ditio
nal i
nfor
mat
ion
see
note
31
Shar
e-ba
sed
paym
ents
.
The
tota
l am
ount
to b
e ex
pens
ed is
de
term
ined
by
refe
renc
e to
the
fair
valu
e of
the
optio
ns g
rant
ed a
t gra
nt d
ate,
as
dete
rmin
ed u
sing
a B
lack
-Sch
oles
mod
el.
Exer
cise
pric
e is
the
stoc
k pr
ice
at d
ate
of
The
tota
l exp
ense
is re
cogn
ized
ove
r the
ve
stin
g pe
riod,
whi
ch is
the
perio
d ov
er
whi
ch a
ll of
the
spec
ified
ves
ting
cond
i-tio
ns a
re to
be
satis
fied.
The
onl
y co
nditi
on
for v
estin
g is
em
ploy
men
t with
the
Com
-pa
ny; o
ptio
ns v
est o
ver a
five
-yea
r per
iod
afte
r gra
nt d
ate.
At t
he e
nd o
f eac
h re
port
ing
perio
d, th
e C
ompa
ny re
vise
s its
est
imat
es o
f the
nu
mbe
r of o
ptio
ns th
at a
re e
xpec
ted
to
vest
bas
ed o
n th
e no
n-m
arke
t ves
ting
cond
ition
s. It
reco
gniz
es th
e im
pact
of t
he
revi
sion
to o
rigin
al e
stim
ates
, if a
ny, i
n th
e in
com
e st
atem
ent,
with
a c
orre
spon
ding
ad
just
men
t to
equi
ty. E
ach
optio
n gi
ves
the
hold
er th
e rig
ht, b
ut n
ot th
e ob
ligat
ion,
to
acq
uire
one
sha
re a
t the
exe
rcis
e pr
ice
on th
e te
rms
and
subj
ect t
o th
e co
nditi
ons
set o
ut in
the
Stoc
k O
ptio
n Pl
an.
Whe
n th
e op
tions
are
exe
rcis
ed, t
he P
ar-
ent i
ssue
s ne
w s
hare
s or
re-is
sues
trea
s-ur
y sh
ares
. The
pro
ceed
s re
ceiv
ed n
et o
f an
y di
rect
ly a
ttrib
utab
le tr
ansa
ctio
n co
sts
are
cred
ited
to s
hare
cap
ital (
nom
inal
va
lue)
and
sha
re p
rem
ium
.
The
gran
t by
the
Com
pany
of o
ptio
ns o
ver
its e
quity
inst
rum
ents
to th
e em
ploy
ees
of
subs
idia
ry u
nder
taki
ngs
in th
e C
ompa
ny
is tr
eate
d as
a c
apita
l con
trib
utio
n. T
he
fair
valu
e of
em
ploy
ee s
ervi
ces
rece
ived
, m
easu
red
by re
fere
nce
to th
e gr
ant d
ate
fair
valu
e, is
reco
gniz
ed o
ver t
he v
estin
g pe
riod
as a
n in
crea
se to
inve
stm
ent i
n su
bsid
iary
und
erta
king
s, w
ith a
cor
re-
spon
ding
cre
dit t
o eq
uity
in th
e pa
rent
en
tity
acco
unts
.
The
soci
al s
ecur
ity c
ontr
ibut
ions
pay
able
in
con
nect
ion
with
the
gran
t of t
he s
hare
op
tions
is c
onsi
dere
d an
inte
gral
par
t of
the
gran
t its
elf,
and
the
char
ge w
ill b
e tr
eate
d as
a c
ash-
sett
led
tran
sact
ion.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
442
2.1
Fina
ncia
l ris
k fa
ctor
s
The
Com
pany
is e
xpos
ed to
a v
arie
ty
of fi
nanc
ial r
isks
thro
ugh
its o
rdin
ary
oper
atio
ns a
nd d
ebt fi
nanc
ing.
Suc
h ris
ks
incl
ude
fore
ign
exch
ange
risk
, int
eres
t rat
e ris
k, c
redi
t ris
k an
d liq
uidi
ty ri
sk.
To m
an-
age
thes
e ris
ks, m
anag
emen
t rev
iew
s an
d
asse
sses
its
prim
ary
finan
cial
and
mar
ket
risks
. Onc
e ris
ks a
re id
entifi
ed, a
ppro
pria
te
actio
n is
take
n to
miti
gate
the
iden
tified
ris
k. T
he C
ompa
ny’s
risk
man
agem
ent i
s ex
erci
sed
in li
ne w
ith g
uide
lines
app
rove
d by
the
Boar
d.
2.2
Fore
ign
exch
ange
ris
ks
USD
is th
e re
port
ing
curr
ency
for t
he
Com
pany
. Fun
ctio
nal c
urre
ncy
for t
he
pare
nt c
ompa
ny a
nd v
esse
l-op
erat
ing
subs
idia
ries
is U
SD, e
xcep
t for
one
of t
he
Nor
weg
ian
subs
idia
ry w
here
NO
K is
the
func
tiona
l cur
renc
y, a
nd th
e Br
azili
an
Fina
ncia
l ass
ets
in 2
014
incl
ude
deriv
ativ
es re
late
d to
hed
ging
of f
orei
gn e
xcha
nge
risks
. The
der
ivat
ives
in th
e se
nsiti
vity
tabl
e in
clud
e
path
depe
nden
t opt
ions
in w
hich
the
valu
e of
the
deriv
ativ
es is
influ
ence
d w
hen
the
unde
rlyin
g re
ache
s or
fluc
tuat
es w
ithin
, be
low
or a
bove
spe
cific
bar
rier l
evel
s. T
he c
hang
e in
val
ue o
f the
se d
eriv
ativ
es w
ill im
pact
the
profi
t of t
he C
ompa
ny.
Fina
ncia
l lia
bilit
ies
in 2
014
and
2013
con
sist
of i
nter
est r
ate
deriv
ativ
es a
nd a
re n
ot in
fluen
ced
by m
ovem
ents
in fo
reig
n ex
chan
ge ra
tes,
and
ther
efor
e no
t inc
lude
d in
the
tabl
e.
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 2
- F
ina
nc
ial
Ris
k M
an
ag
em
en
t
CO
NSO
LID
ATED
Fore
ign
exch
ange
risk
rate
10%
(Am
ount
s in
USD
1,0
00)
+10%
mov
emen
ts-1
0% m
ovem
ents
Dec
embe
r 31
, 201
4C
arry
ing
amou
ntP
rofit
/(lo
ss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 1
17,6
23
3,6
143,
614
-3,6
14-3
,614
Der
ivat
ives
1,0
41
- -
- -
Acc
ount
s re
ceiv
able
74,
753
1,2
92
1,29
2-1
,292
-1,2
92
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
193
,417
4
,907
4,9
07 -4
,907
-4
,907
Fina
ncia
l lia
bilit
ies
Acc
ount
s pa
yabl
e 1
0,78
1 -1
,583
-1
,583
1
,583
1
,583
Der
ivat
ives
16,
732
18,
402
18,4
02-2
1,01
6-2
1,01
6
Borr
owin
gs 1
,214
,360
-5
1,39
9 -5
1,39
9 5
1,39
9 5
1,39
9
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
1,2
41,8
73
-34,
580
-34,
580
31,9
6631
,966
Inco
me
stat
emen
t
Ope
ratin
g re
venu
e 4
91,3
12
20,
149
20,
149
-20,
149
-20,
149
Ope
ratin
g ex
pens
es 2
97,1
87
-18,
284
-18,
284
18,
284
18,
284
Impa
ct o
n op
erat
ing
resu
lt b
efor
e ta
x 1
94,1
25
1,8
66
1,8
66
-1,8
66
-1,8
66
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -2
7,80
7 -2
7,80
725
,193
25,1
93
All
ocat
ion
per
curr
ency
NO
K
-21,
985
-21,
985
19,
371
19,
371
EUR
1
0,27
4 1
0,27
4 -1
0,27
4 -1
0,27
4
GBP
440
4
40
-440
-4
40
BRL
-16,
537
-16,
537
16,
537
16,
537
Tota
l inc
reas
e/ d
ecre
ase
befo
re ta
x -2
7,80
7 -2
7,80
7 2
5,19
3 2
5,19
3
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
443
subs
idia
ry w
here
BRL
is th
e fu
nctio
nal
curr
ency
. Rem
aini
ng s
ubsi
diar
ies
use
NO
K a
nd E
UR
as fu
nctio
nal c
urre
ncy.
The
C
ompa
ny o
pera
tes
inte
rnat
iona
lly a
nd is
ex
pose
d to
fore
ign
exch
ange
risk
s ar
isin
g fr
om v
ario
us c
urre
ncy
expo
sure
s pr
imar
y w
ith re
spec
t to
NO
K, G
BP, E
UR
and
BRL
. Fo
reig
n ex
chan
ge ri
sks
can
be d
ivid
ed in
to
tran
sact
ion
risk
from
pay
ing
and
rece
ivin
g fo
reig
n cu
rren
cy a
nd tr
ansl
atio
n ris
k du
e to
reco
gniz
ing
asse
ts a
nd li
abili
ties
in
USD
. The
Com
pany
had
in 2
014
and
2013
mai
nly
USD
, NO
K, E
UR
and
BRL
reve
nue
and
expe
nses
. A
t yea
r end
, the
Com
pany
had
one
shi
p-bu
ildin
g co
ntra
ct w
ith a
Bra
zilia
n ya
rd fo
r th
e co
nstr
uctio
n of
one
OSR
V, s
hipb
uild
-in
g co
ntra
cts
with
a P
olis
h ya
rd fo
r the
co
nstr
uctio
n of
four
PSV
s an
d on
e C
LV
and
ship
build
ing
cont
ract
s w
ith a
Ger
man
ya
rd fo
r con
stru
ctio
n of
two
WIV
s. T
he
cont
ract
with
the
Bra
zilia
n ya
rd is
in U
SD,
the
cont
ract
s w
ith th
e Po
lish-
and
Ger
-m
an y
ards
are
in E
UR.
Fur
ther
info
rma-
tion
rega
rdin
g th
ese
cont
ract
s is
set
out
in
Not
e 2.
5 an
d N
ote
17.
The
Com
pany
is e
xpos
ed to
fore
ign
exch
ange
risk
of i
ts s
ubsi
diar
ies,
incl
udin
g th
e de
velo
pmen
t of t
he B
razi
lian
Real
. Th
e fo
llow
ing
sens
itivi
ty ta
ble
dem
on-
stra
tes
the
impa
ct o
n th
e C
ompa
ny’s
pr
ofit a
nd e
quity
bef
ore
tax
from
pot
entia
l ch
ange
s to
the
exch
ange
rate
s, a
ll ot
her
varia
bles
hel
d co
nsta
nt.
CO
NSO
LID
ATED
Fore
ign
exch
ange
risk
rate
10%
(Am
ount
s in
USD
1,0
00)
+10%
mov
emen
ts-1
0% m
ovem
ents
Dec
embe
r 31
, 201
3C
arry
ing
amou
ntP
rofit
/(lo
ss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 1
01,2
06
2,4
73
2,4
73
-2,4
73
-2,4
73
Der
ivat
ives
- -
- -
-
Acc
ount
s re
ceiv
able
53,
198
2,6
53
2,6
53
-2,6
53
-2,6
53
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
154
,404
5
,126
5
,126
-5
,126
-5
,126
Fina
ncia
l lia
bilit
ies
Acc
ount
s pa
yabl
e 1
6,25
3 -1
,966
-1
,966
1
,966
1
,966
Der
ivat
ives
11,
085
-33,
797
-33,
797
29,
343
29,
343
Borr
owin
gs 9
61,5
00
-36,
253
-36,
253
36,
253
36,
253
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
988
,838
-7
2,01
6 -7
2,01
6 6
7,56
2 6
7,56
2
Inco
me
stat
emen
t
Ope
ratin
g re
venu
e 3
63,9
55
16,
834
16,
834
-16,
834
-16,
834
Ope
ratin
g ex
pens
es 2
41,2
91
-19,
235
-19,
235
19,
235
19,
235
Impa
ct o
n op
erat
ing
resu
lt b
efor
e ta
x 1
22,6
63
-2,4
01
-2,4
01
2,4
01
2,4
01
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -6
9,29
0 -6
9,29
0 6
4,83
6 6
4,83
6
All
ocat
ion
per
curr
ency
NO
K
-60,
250
-60,
250
55,
797
55,
797
EUR
2
,079
2
,079
-2
,079
-2
,079
GB
P 4
50
450
-4
50
-450
BRL
-11,
569
-11,
569
11,
570
11,
570
Tota
l inc
reas
e/ d
ecre
ase
befo
re ta
x -6
9,29
0 -6
9,29
0 6
4,83
6 6
4,83
6
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
444
NO
TES
TO
TH
E A
CC
OU
NTS
PAR
ENT
CO
MPA
NY
Fore
ign
exch
ange
risk
rate
10%
(Am
ount
s in
USD
1,0
00)
+10%
mov
emen
ts-1
0% m
ovem
ents
Dec
embe
r 31
, 201
4C
arry
ing
amou
ntP
rofit
/(l
oss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 2
22,5
79
15,
217
15,
217
-15,
217
-15,
217
Acc
ount
s re
ceiv
able
- -
- -
-
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
222
,579
1
5,21
7 1
5,21
7 -1
5,21
7 -1
5,21
7
Fina
ncia
l lia
bilit
ies
Acc
ount
s pa
yabl
e 5
3 -1
-1
1
1
Der
ivat
ives
- -
- -
-
Borr
owin
gs 1
74,8
81
-20,
334
-20,
334
20,
334
20,
334
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
174
,934
-2
0,33
4 -2
0,33
4 2
0,33
4 2
0,33
4
Inco
me
stat
emen
t
Ope
ratin
g re
venu
e 4
05
- -
- -
Ope
ratin
g ex
pens
es 1
2,52
1 -1
,156
-1
,156
1
,156
1
,156
Impa
ct o
n op
erat
ing
resu
lt b
efor
e ta
x -1
2,11
6 -1
,156
-1
,156
1
,156
1
,156
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -6
,273
-6
,273
6
,273
6
,273
All
ocat
ion
per
curr
ency
NO
K
-8,2
12
-8,2
12
8,2
12
8,2
12
EUR
1
,916
1
,916
-1
,916
-1
,916
GBP
23
23
-23
-23
Tota
l inc
reas
e/ d
ecre
ase
befo
re ta
x -6
,273
-6
,273
6
,273
6
,273
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
445
PAR
ENT
CO
MPA
NY
Fore
ign
exch
ange
risk
rate
10%
(Am
ount
s in
USD
1,0
00)
+10%
mov
emen
ts-1
0% m
ovem
ents
Dec
embe
r 31
, 201
3C
arry
ing
amou
ntP
rofit
/(l
oss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 1
32,0
68
7,9
46
7,9
46
-7,9
46
-7,9
46
Acc
ount
s re
ceiv
able
3,4
47
- -
- -
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
135
,514
7
,946
7
,946
-7
,946
-7
,946
Fina
ncia
l lia
bilit
ies
Acc
ount
s pa
yabl
e 3
97
-19
-19
19
19
Der
ivat
ives
- -
- -
-
Borr
owin
gs 9
8,62
4 -1
4,03
4 -1
4,03
4 1
4,03
4 1
4,03
4
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
99,
021
-14,
053
-14,
053
14,
053
14,
053
Inco
me
stat
emen
t
Ope
ratin
g re
venu
e 1
0,95
3 -2
-2
2
2
Ope
ratin
g ex
pens
es 1
8,77
4 -1
,189
-1
,189
1
,189
1
,189
Impa
ct o
n op
erat
ing
resu
lt b
efor
e ta
x -7
,821
-1
,191
-1
,191
1
,191
1
,191
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -7
,298
-7
,298
7
,298
7
,298
All
ocat
ion
per
curr
ency
NO
K
-7,3
24
-7,3
24
7,3
24
7,3
24
EUR
-1
0 -1
0 1
0 1
0
GBP
36
36
-36
-36
Tota
l inc
reas
e/ d
ecre
ase
befo
re ta
x -7
,298
-7
,298
7
,298
7
,298
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
446
NO
TES
TO
TH
E A
CC
OU
NTS
2.3
Cre
dit r
isks
Con
cent
ratio
n ris
ksTh
e C
ompa
ny’s
cre
dit r
isk
is p
rimar
ily
attr
ibut
able
to it
s tr
ade
and
othe
r sho
rt-
term
rece
ivab
les
and
asse
t der
ivat
ive
posi
tions
. The
der
ivat
ive
coun
terp
artie
s ar
e la
rge
esta
blis
hed
finan
cial
inst
itutio
ns,
and
the
coun
terp
arty
risk
for t
he a
sset
de-
rivat
ive
posi
tions
are
rega
rded
as
limite
d.Th
e ex
posu
re to
cre
dit r
isk
for t
rade
and
ot
her s
hort
term
rece
ivab
les
is m
easu
red
on a
n on
goin
g ba
sis
and
cred
it ev
alua
tions
ar
e pe
rfor
med
for c
usto
mer
s id
entifi
ed
to b
e ris
ky. T
he C
ompa
ny’s
deb
tors
are
m
ainl
y m
ajor
oil
com
pani
es a
nd o
ffsh
ore
serv
ice
com
pani
es, w
hich
are
con
side
red
to b
e cr
editw
orth
y th
ird p
artie
s. H
isto
ri-
cally
, the
loss
per
cent
age
has
been
low
. O
ngoi
ng p
rovi
sion
s ar
e m
ade
and,
on
Dec
embe
r 31,
201
4, th
e pr
ovis
ion
for c
er-
tain
acc
ount
s re
ceiv
able
s w
hich
may
not
be
pai
d in
full
was
USD
9.5
mill
ion
for t
he
Com
pany
(201
3: U
SD 7
.0 m
illio
n) a
nd U
SD
751K
for t
he P
aren
t (20
13: U
SD 0
K).
The
tabl
e be
low
pre
sent
s th
e co
ncen
trat
ion
risks
for 2
014
and
2013
.
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
USD
% o
f tot
alU
SD%
of t
otal
Rec
eiva
bles
on
Dec
embe
r 31
, 201
4
1 to
5 la
rges
t -
- 5
0,45
4 67
.5 %
6 to
10
larg
est
- -
16,
279
21.8
%
Oth
ers
- -
8,0
20
10.7
%
Tota
l acc
ount
s re
ceiv
able
s -
- 7
4,75
3 10
0%
(Am
ount
s in
USD
1,0
00)
USD
% o
f tot
alU
SD%
of t
otal
Rec
eiva
bles
on
Dec
embe
r 31
, 201
3
1 to
5 la
rges
t3,
447
100.
0 %
32,
311
60.7
%
6 to
10
larg
est
- -
17,
978
33.8
%
Oth
ers
- -
2,9
09
5.5
%
Tota
l acc
ount
s re
ceiv
able
s 3
,447
10
0% 5
3,19
8 10
0%
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
447
Trad
e an
d re
ceiv
able
sTh
e ta
ble
belo
w p
rese
nts
an a
ging
ana
lysi
s of
the
outs
tand
ing
rece
ivab
les
at y
ear
end
2014
and
201
3.
Ove
rdue
rec
eiva
bles
are
follo
wed
up
cont
inua
lly b
y M
anag
emen
t. Th
e M
anag
emen
t con
side
rs th
e ou
tsta
ndin
g am
ount
s to
be
reco
vera
ble.
At y
ear
end
2014
the
rece
ivab
les
wer
e si
gnifi
cant
ly h
ighe
r th
an a
s fo
r 20
13. T
his
was
cau
sed
by s
anct
ions
aff
ectin
g,re
ceiv
able
s fr
om th
e K
ara-
Sea
proj
ect.
Paym
ents
from
Pet
robr
as in
Bra
zil w
as d
elay
ed d
ue to
form
al a
ppro
val r
equi
rem
ents
. The
maj
ority
of t
hese
rece
ivab
les
have
bee
n pa
id in
Q1
2015
. The
max
imum
exp
osur
e to
cre
dit r
isk
at th
e re
port
ing
date
is th
e ca
rryi
ng v
alue
of e
ach
clas
s of
acc
ount
s re
ceiv
able
s m
entio
ned
abov
e.
The
carr
ying
am
ount
of t
he C
ompa
ny’s
and
Pare
nt’s
acco
unts
rece
ivab
les
are
deno
min
ated
in th
e fo
llow
ing
curr
enci
es:
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
USD
% o
f tot
alU
SD%
of t
otal
Agi
ng o
n D
ecem
ber
31, 2
014
Not
due
- -
28,
392
38.0
%
Due
up
to 1
mon
th -
- 1
4,82
3 19
.8 %
Due
1-4
mon
ths
- -
12,
409
16.6
%
Due
mor
e th
an 4
mon
ths
- -
19,
128
25.6
%
Tota
l acc
ount
s re
ceiv
able
s -
- 7
4,75
3 10
0%
(Am
ount
s in
USD
1,0
00)
USD
% o
f tot
alU
SD%
of t
otal
Agi
ng o
n D
ecem
ber
31, 2
013
Not
due
- -
27,
365
51.4
%
Due
up
to 1
mon
th -
- 1
6,51
1 31
.0 %
Due
1-4
mon
ths
- -
3,0
45
5.7
%
Due
mor
e th
an 4
mon
ths
3,4
47
100.
0 %
6,2
76
11.8
%
Tota
l acc
ount
s re
ceiv
able
s 3
,447
10
0% 5
3,19
8 10
0%
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
2014
2013
2014
2013
Cur
renc
y
USD
- 3
,447
6
1,83
0 2
6,67
0
NO
K -
- 1
,947
1
0,12
3
EUR
- -
5,6
06
10,
999
GB
P -
- 2
,386
2
,015
BRL
- -
2,9
84
3,3
91
Tota
l acc
ount
s re
ceiv
able
s -
3,4
47
74,
753
53,
198
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
448
2.4
Cas
h fl
ow, i
nter
est r
isk
and
fair
val
ue
The
Com
pany
is fi
nanc
ed b
y de
bt a
nd
equi
ty. I
f the
Com
pany
fails
to re
pay
or
refin
ance
its
loan
faci
litie
s, a
dditi
onal
eq-
uity
fina
ncin
g m
ay b
e re
quire
d. T
here
can
be
no
assu
ranc
e th
at th
e C
ompa
ny w
ill
be a
ble
to re
pay
its d
ebts
or e
xten
d re
-pa
ymen
t sch
edul
es th
roug
h re
-fina
ncin
g
of it
s lo
an a
gree
men
ts o
r avo
id n
et c
ash
flow
sho
rtfa
lls e
xcee
ding
the
Com
pany
’s
avai
labl
e fu
ndin
g so
urce
s or
com
ply
with
m
inim
um c
ash
requ
irem
ents
. Fur
ther
, th
ere
can
be n
o as
sura
nce
that
the
Com
pany
will
be
able
to ra
ise
new
equ
ity,
or a
rran
ge n
ew b
orro
win
g fa
cilit
ies,
on
favo
urab
le te
rms
and
in a
mou
nts
nece
s-sa
ry to
con
duct
its
ongo
ing
and
futu
re
oper
atio
ns, s
houl
d th
is b
e re
quire
d.
In th
e ev
ent o
f ins
olve
ncy,
liqu
idat
ion
or s
imila
r eve
nt re
latin
g to
a s
ubsi
diar
y of
the
Com
pany
, all
cred
itors
of s
uch
subs
idia
ry w
ould
be
entit
led
to p
aym
ent
in fu
ll ou
t of t
he a
sset
s of
suc
h su
bsid
iary
be
fore
the
Com
pany
, as
a sh
areh
olde
r, w
ould
be
entit
led
to a
ny p
aym
ents
. De-
faul
ts b
y, o
r the
inso
lven
cy o
f, a
subs
idia
ry
of th
e C
ompa
ny c
ould
resu
lt in
the
oblig
a-tio
n of
the
Com
pany
to m
ake
paym
ents
NO
TES
TO
TH
E A
CC
OU
NTS
CO
NSO
LID
ATED
Inte
rest
rate
risk
(IR)
(Am
ount
s in
USD
1,0
00)
-1%
mov
emen
ts+1
% m
ovem
ents
Dec
embe
r 31
, 201
4C
arry
ing
amou
ntP
rofit
/(lo
ss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 1
17,6
23
-1,1
76
-1,1
76
1,1
76
1,1
76
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
117
,623
-1
,176
-1
,176
1
,176
1
,176
Fina
ncia
l lia
bilit
ies
Borr
owin
gs 6
68,7
72
2,6
89
2,6
89
-2,3
20
-2,3
20
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
668
,772
2,
689
2,68
9 -2
,320
-2,3
20
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x 1
,513
1,5
13
-1,1
44 -1
,144
CO
NSO
LID
ATED
Inte
rest
rate
risk
(IR)
(Am
ount
s in
USD
1,0
00)
-1%
mov
emen
ts+1
% m
ovem
ents
Dec
embe
r 31
, 20
13C
arry
ing
amou
ntP
rofit
/(lo
ss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 1
01,2
06
-1,0
12
-1,0
12
1,0
12
1,0
12
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
101
,206
-1
,012
-1
,012
1
,012
1
,012
Fina
ncia
l lia
bilit
ies
Borr
owin
gs 6
29,2
21
-3,8
86
-3,8
86
3,3
50
3,3
50
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
629
,221
-3
,886
-3
,886
3
,350
3
,350
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -4
,898
-4
,898
4
,362
4
,362
Borr
owin
gs in
the
tabl
es a
bove
(bot
h fo
r 201
4 an
d 20
13) i
nclu
de o
nly
borr
owin
gs w
ith fl
oatin
g in
tere
st.
Abo
ve m
ovem
ents
als
o in
clud
e th
e ef
fect
of i
nter
est r
ate
swap
s en
tere
d in
to in
ord
er to
hed
ge th
e flo
atin
g in
tere
st ri
sk. M
arke
t-to
-mar
-ke
t eff
ects
in re
latio
n to
the
inte
rest
rate
sw
aps
impa
cts
the
profi
t and
loss
follo
win
g a
chan
ge o
f +/-
1%
in th
e in
tere
st ra
te.
For m
ore
deta
ils, s
ee N
ote
12
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
449
PAR
ENT
CO
MPA
NY
Inte
rest
rate
risk
(IR)
(Am
ount
s in
USD
1,0
00)
-1%
mov
emen
ts+1
% m
ovem
ents
Dec
embe
r 31
, 201
4C
arry
ing
amou
ntP
rofit
/(lo
ss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 2
22,5
79
-2,2
26
-2,2
26
2,2
26
2,2
26
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
222
,579
-2
,226
-2
,226
2
,226
2
,226
Fina
ncia
l lia
bilit
ies
Bor
row
ings
174
,881
1
,749
1
,749
-1
,749
-1
,749
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
174
,881
1
,749
1
,749
-1
,749
-1
,749
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -4
77
-477
4
77
477
PAR
ENT
CO
MPA
NY
Inte
rest
rate
risk
(IR)
(Am
ount
s in
USD
1,0
00)
-1%
mov
emen
ts+1
% m
ovem
ents
Dec
embe
r 31
, 201
3C
arry
ing
amou
ntP
rofit
/(lo
ss)
Equi
tyP
rofit
/(lo
ss)
Equi
ty
Fina
ncia
l ass
ets
Cas
h an
d ca
sh e
quiv
alen
t 1
32,0
68
-1,3
21
-1,3
21
1,3
21
1,3
21
Impa
ct o
n fin
anci
al a
sset
s be
fore
tax
132
,068
-1
,321
-1
,321
1
,321
1
,321
Fina
ncia
l lia
bilit
ies
Bor
row
ings
98,
624
986
9
86
-986
-9
86
Impa
ct o
n fin
anci
al li
abili
ties
bef
ore
tax
98,
624
986
9
86
-986
-9
86
Tota
l inc
reas
e/de
crea
se b
efor
e ta
x -3
35
-335
3
35
335
unde
r par
ent c
ompa
ny g
uara
ntee
s is
sued
in
favo
ur o
f suc
h su
bsid
iary
.
The
Com
pany
is m
oreo
ver e
xpos
ed to
ch
ange
s in
inte
rest
rate
s, w
hich
may
aff
ect
the
Com
pany
’s fi
nanc
ial r
esul
ts. T
hese
ris
ks a
re m
ainl
y re
late
d to
the
Com
pany
’s
long
term
bor
row
ings
with
floa
ting
inte
rest
ra
tes.
Fur
ther
det
ails
of t
he C
ompa
ny’s
bo
rrow
ings
are
set
out
in N
ote
12.
Cas
h an
d ca
sh e
quiv
alen
ts a
re in
vest
ed
for s
hort
mat
urity
per
iods
, gen
eral
ly
from
1 d
ay to
3 m
onth
s, w
hich
miti
gate
s th
e po
tent
ial i
nter
est r
ate
risk.
The
follo
win
g se
nsiti
vity
tabl
es d
em-
onst
rate
the
impa
ct o
n th
e C
ompa
ny’s
pr
ofit b
efor
e ta
x an
d eq
uity
from
a
pote
ntia
l shi
ft in
inte
rest
rate
s, a
ll ot
her
varia
bles
hel
d co
nsta
nt.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
450
NO
TES
TO
TH
E A
CC
OU
NTS
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
B
ook
valu
eFa
ir v
alue
Boo
k va
lue
Fair
val
ue
Fina
ncia
l ass
ets
CIR
R lo
an d
epos
it 2
8,45
3 3
0,11
4 4
1,71
8 4
2,58
0
Long
-ter
m re
ceiv
able
s 2
3,43
2 2
3,43
2 6
,639
6
,639
Acc
ount
s re
ceiv
able
s 7
4,75
3 7
4,75
3 5
3,19
8 5
3,19
8
Oth
er s
hort
-ter
m re
ceiv
able
s 6
3,87
7 6
3,87
7 3
2,73
7 3
2,73
7
Der
ivat
ive
finan
cial
inst
rum
ents
1,0
41
1,0
41
- -
Cas
h an
d ca
sh e
quiv
alen
ts 1
17,6
23
117
,623
1
01,2
06
101
,206
Tota
l 3
09,1
79
310
,840
2
35,4
98
236
,360
Fina
ncia
l lia
bilit
ies
Borr
owin
gs 1
,214
,360
1
,250
,847
9
61,5
00
970
,585
CIR
R lo
an 2
8,45
3 3
0,11
4 4
1,71
8 4
2,58
0
Oth
er n
on-c
urre
nt li
abili
ties
26,
565
26,
565
18,
826
18,
826
Acc
ount
s pa
yabl
e 1
0,78
1 1
0,78
1 1
6,25
3 1
6,25
3
Der
ivat
ive
finan
cial
inst
rum
ents
16,
732
16,
732
11,
085
11,
085
Oth
er c
urre
nt li
abili
ties
123
,072
1
23,0
72
44,
061
44,
061
Tota
l 1
,419
,963
1
,458
,111
1
,093
,443
1
,103
,390
The
Com
pany
’s fi
nanc
ial a
sset
s ar
e cl
assi
fied
into
the
cate
gorie
s: a
sset
s at
fa
ir va
lue
thro
ugh
the
profi
t and
loss
, lo
ans
and
rece
ivab
les.
Fin
anci
al li
abili
ties
are
clas
sifie
d as
liab
ilitie
s at
fair
valu
e th
roug
h th
e pr
ofit a
nd lo
ss, a
nd o
ther
fin
anci
al li
abili
ties.
For
furt
her i
nfor
ma-
tion
abou
t com
paris
on b
y ca
tego
ry, s
ee
Not
e 29
.
The
valu
e of
forw
ard
exch
ange
con
trac
ts
is s
et b
y co
mpa
ring
forw
ard
exch
ange
ra
te a
nd th
e ra
te o
n th
e re
port
ing
date
. The
Com
pany
’s fo
llow
ing
finan
cial
in
stru
men
ts a
re n
ot e
valu
ated
at f
air
valu
e: a
ccou
nts
rece
ivab
le, c
ash
and
cash
eq
uiva
lent
s, o
ther
sho
rt -t
erm
rece
ivab
les,
ac
coun
ts p
ayab
le a
nd lo
ng-t
erm
liab
ilitie
s w
ith fl
oatin
g in
tere
st.
Beca
use
of th
e sh
ort t
erm
to m
atur
ity, t
he
valu
e of
cas
h an
d ca
sh e
quiv
alen
ts e
nter
ed
into
the
Stat
emen
ts o
f Fin
anci
al P
ositi
on is
al
mos
t the
sam
e as
the
fair
valu
e of
thes
e.
Acc
ordi
ngly
, the
val
ues
of a
ccou
nts
rece
iva-
bles
and
acc
ount
s pa
yabl
es a
re a
lmos
t the
sam
e as
thei
r fai
r val
ues
sinc
e th
ey a
re
ente
red
on “n
orm
al” c
ondi
tions
.
The
fair
valu
e of
the
Com
pany
’s n
on-
curr
ent l
iabi
litie
s su
bjec
ted
to fi
xed
inte
rest
rate
s is
cal
cula
ted
by c
ompa
ring
the
Com
pany
’s te
rms
and
mar
ket t
erm
s fo
r lia
bilit
ies
with
the
sam
e te
rms
to
mat
urity
and
cre
dit r
isk.
The
follo
win
g ta
bles
dis
play
the
book
ed
valu
e an
d th
e fa
ir va
lue
of fi
nanc
ial a
s-se
ts a
nd fi
nanc
ial l
iabi
litie
s.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
451
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
B
ook
valu
eFa
ir v
alue
Boo
k va
lue
Fair
val
ue
Fina
ncia
l ass
ets
CIR
R lo
an d
epos
it 2
8,45
3 3
0,11
4 4
1,71
8 4
2,58
0
Long
-ter
m lo
an 3
0,05
3 3
0,05
3 4
7,09
4 4
7,09
4
Acc
ount
s re
ceiv
able
- -
3,4
47
3,4
47
Oth
er s
hort
-ter
m re
ceiv
able
s 1
7,34
3 1
7,34
3 7
,340
7
,340
Cas
h an
d ca
sh e
quiv
alen
ts 2
22,5
79
222
,579
1
32,0
68
132
,068
Tota
l 2
98,4
29
300
,089
2
31,6
67
232
,529
Fina
ncia
l lia
bilit
ies
CIR
R lo
an 2
8,45
3 3
0,11
4 4
1,71
8 4
2,58
0
Acc
ount
s pa
yabl
e 5
3 5
3 3
97
397
Oth
er c
urre
nt li
abili
ties
67,
255
67,
255
8,1
70
8,1
70
Tota
l 9
5,76
1 9
7,42
2 5
0,28
5 5
1,14
7
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
452
2.5
Liqu
idit
y ri
sk
The
Com
pany
mon
itors
its
cash
flow
fr
om o
pera
tions
clo
sely
and
opt
imiz
es
the
wor
king
cap
ital l
evel
of t
he in
divi
dual
co
mpa
nies
and
the
Com
pany
as
a w
hole
. Th
e C
ompa
ny fu
nds
are
used
for i
nves
t-m
ent o
ppor
tuni
ties
in th
e bu
sine
ss, y
ard
inst
alm
ents
, sch
edul
ed re
paym
ents
and
re
paym
ents
of d
ebt a
nd to
gen
eral
wor
k-
ing
capi
tal p
urpo
ses.
The
Com
pany
see
ks
to fi
x th
e m
ajor
ity o
f its
flee
t on
long
-ter
m
cont
ract
s. V
esse
ls n
ot fi
xed
on lo
ng-t
erm
co
ntra
cts
are
expo
sed
to th
e vo
latil
ity in
th
e sp
ot m
arke
t. Th
e C
ompa
ny w
ill fr
om ti
me
to ti
me
re-
quire
add
ition
al c
apita
l to
take
adv
anta
ge
of b
usin
ess
oppo
rtun
ities
. His
toric
ally
th
e C
ompa
ny h
as m
anag
ed to
obt
ain
nece
ssar
y fin
anci
ng in
a ti
mel
y m
anne
r on
acce
ptab
le te
rms
whe
n ne
eded
. Th
e ta
bles
bel
ow s
umm
ariz
e th
e m
atur
ity
profi
le o
f the
Com
pany
’s fi
nanc
ial l
i-ab
ilitie
s, a
nd fu
ture
com
mitm
ents
to th
e ne
wbu
ildin
g pr
ogra
m.
The
tabl
es d
o no
t inc
lude
futu
re in
tere
st
paym
ents
.
NO
TES
TO
TH
E A
CC
OU
NTS
PAR
ENT
CO
MPA
NY
Dec
embe
r 31
, 201
4Le
ss th
an 3
m
onth
s3
to 1
2 m
onth
s1
to 5
ye
ars
Ther
eaft
erTo
tal
Inte
rest
-bea
ring
loan
s an
d bo
rrow
ings
- 5
,691
1
97,6
43
- 2
03,3
34
Trad
e an
d ot
her p
ayab
les
53
- -
- 5
3
Tota
l 5
3 5
,691
1
97,6
43
- 2
03,3
87
Dec
embe
r 31
, 201
3
Inte
rest
-bea
ring
loan
s an
d bo
rrow
ings
- 6
,953
1
26,4
36
6,9
53
140
,342
Trad
e an
d ot
her p
ayab
les
397
-
- -
397
Tota
l 3
97
6,9
53
126
,436
6
,953
1
40,7
39
CO
NSO
LID
ATED
Dec
embe
r 31
, 201
4Le
ss th
an 3
m
onth
s3
to 1
2 m
onth
s1
to 5
yea
rsTh
erea
fter
Tota
l
Inte
rest
-bea
ring
loan
s an
d bo
rrow
ings
23,
085
291
,508
7
75,0
86
166
,379
1
,256
,058
Trad
e an
d ot
her p
ayab
les
10,
781
- -
- 1
0,78
1
Tota
l 3
3,86
6 2
91,5
08
775
,086
1
66,3
79
1,2
66,8
39
Dec
embe
r 31
, 201
3
Inte
rest
-bea
ring
loan
s an
d bo
rrow
ings
31,
414
76,
294
726
,630
1
76,2
47
1,0
10,5
86
Trad
e an
d ot
her p
ayab
les
16,
253
- -
- 1
6,25
3
Tota
l 4
7,66
7 7
6,29
4 7
26,6
30
176
,247
1
,026
,839
CO
NSO
LID
ATED
Dec
embe
r 31
, 201
4Le
ss th
an 3
m
onth
s3
to 1
2 m
onth
s1
to 5
ye
ars
Ther
eaft
erTo
tal
Yard
inst
alm
ents
fall
ing
due
39,
262
202
,800
3
08,4
08
- 5
50,4
70
Dec
embe
r 31
, 201
3
Yard
inst
alm
ents
fall
ing
due
71,
271
323
,225
3
06,4
73
- 7
00,9
69
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
453
2.6
Cap
ital
ris
k m
anag
emen
t
The
Com
pany
see
ks to
obt
ain
long
-ter
m
finan
cing
sup
port
ed b
y lo
ng-t
erm
con
-tr
acts
, in
orde
r to
redu
ce th
e fr
eque
ncy
and
risk
asso
ciat
ed w
ith th
e re
finan
cing
of
loan
s. L
ong-
term
cha
rter
par
ties
will
als
o en
able
a h
ighe
r deg
ree
of d
ebt-
finan
cing
. Th
e w
holly
-ow
ned
Nor
weg
ian
com
pany
, Si
em O
ffsh
ore
Rede
ri A
S, h
as 7
ves
-se
ls u
nder
con
stru
ctio
n in
Pol
and
and
Ger
man
y at
yea
r end
, whi
ch in
clud
es fo
ur
dual
-fue
l PSV
s, o
ne C
LV a
nd tw
o W
IVs.
Fi
rst 1
0% to
20%
of t
he c
ontr
act p
rice
is
or w
ill b
e pa
id in
acc
orda
nce
with
agr
eed
paym
ent s
ched
ules
and
the
rem
ain-
ing
80%
to 9
0% w
ill b
e pa
id a
t del
iver
y.
The
Com
pany
has
sec
ured
long
-ter
m
empl
oym
ent f
or o
ne P
SV a
nd fo
r the
two
WIV
s un
der c
onst
ruct
ion.
The
CLV
will
be
utili
sed
by th
e C
ompa
ny’s
who
lly-o
wne
d su
bsid
iary
, Sie
m O
ffsh
ore
Con
trac
tors
, for
pr
ojec
t wor
k w
ithin
the
subm
arin
e po
wer
ca
ble
inst
alla
tion,
repa
ir an
d m
aint
enan
ce
segm
ent.
The
Com
pany
is in
dis
cuss
ions
fo
r lon
g-te
rm c
ontr
acts
for t
he th
ree
dual
fu
elle
d PS
Vs.
The
who
lly-o
wne
d B
razi
lian
subs
idia
ry,
Siem
Off
shor
e do
Bra
sil S
A, h
as o
ne
OSR
V un
der c
onst
ruct
ion
in B
razi
l at y
ear-
end.
The
OSR
V is
sch
edul
ed fo
r del
iver
y in
201
5. T
he v
esse
l sha
ll co
mm
ence
an
eigh
t-ye
ar fi
rm c
ontr
act f
or P
etro
bras
w
ith o
ptio
ns fo
r add
ition
al e
ight
-yea
r pe
riods
.
The
com
pany
has
sec
ured
deb
t-fin
anci
ng
for a
ll of
the
eigh
t who
lly o
wne
d ve
ssel
s un
der c
onst
ruct
ion
at y
ear-
end.
2.7
Ris
ks r
elat
ed to
loan
agr
eem
ents
, re
stri
ctio
ns o
n di
vide
nds
and
dist
ribu
-ti
on
The
Com
pany
’s lo
an a
gree
men
ts in
clud
e te
rms,
con
ditio
ns a
nd c
oven
ants
whi
ch
impo
se re
stric
tions
on
the
oper
atio
ns o
f th
e C
ompa
ny.
Thes
e re
stric
tions
may
neg
ativ
ely
affe
ct
the
Com
pany
’s o
pera
tions
incl
udin
g, b
ut
not l
imite
d to
, the
Com
pany
’s a
bilit
y to
m
eet t
he fi
erce
com
petit
ion
in th
e m
arke
t in
whi
ch it
ope
rate
s.
2.8
Ris
ks r
elat
ed to
pos
sibl
e ta
x li-
abili
ties
The
Com
pany
see
ks to
opt
imiz
e its
tax
stru
ctur
e to
min
imiz
e w
ithho
ldin
g ta
xes
whe
n op
erat
ing
vess
els
abro
ad, a
void
ing
doub
le ta
xatio
n, a
nd m
inim
izin
g co
rpor
ate
tax
paid
by
mak
ing
optim
al u
se o
f the
ship
ping
taxa
tion
rule
s th
at a
pply
. It i
s,
how
ever
, a c
halle
ngin
g ta
sk to
opt
imiz
e ta
xatio
n, a
nd th
ere
is a
lway
s a
risk
that
th
e C
ompa
ny m
ay e
nd u
p pa
ying
mor
e ta
xes
than
the
theo
retic
al m
inim
um,
whi
ch m
ay in
turn
aff
ect t
he fi
nanc
ial
resu
lts n
egat
ivel
y.
2.9
Long
term
con
trac
ts
The
Com
pany
use
s th
e pe
rcen
tage
-of-
com
plet
ion
met
hod
in a
ccou
ntin
g fo
r its
fix
ed p
rice
cons
truc
tion
cont
ract
s re
late
d to
the
segm
ent S
ubm
arin
e Po
wer
Cab
le
Inst
alla
tion.
Sig
nific
ant e
stim
ates
are
es
timat
e of
the
perc
ent c
ompl
ete
and
the
over
all m
argi
n.
The
follo
win
g se
nsiti
vity
tabl
e de
mon
-st
rate
s th
e im
pact
on
the
Com
pany
’s
profi
t and
equ
ity b
efor
e ta
x fr
om p
oten
tial
chan
ges
to th
e pe
rcen
tage
of c
ompl
e-tio
n an
d m
argi
n, a
ll ot
her v
aria
bles
hel
d co
nsta
nt.
Con
solid
ated
(Am
ount
s in
USD
1,0
00)
Long
term
con
trac
ts
+1%
mov
emen
ts-1
% m
ovem
ents
Dec
embe
r 31
, 201
4Es
tim
ated
to
tal
reve
nue
Pro
fit/(
loss
)Eq
uity
Pro
fit/(
loss
)Eq
uity
Prog
ress
repo
rtin
g, e
ffec
t fro
m m
ovem
ent
150
,166
1,5
02
1,5
02
-1,5
02
-1,5
02
Mar
gin
estim
ate,
eff
ect f
rom
mov
emen
t -
1,5
02
1,5
02
-1,5
02
-1,5
02
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
454
No
te 3
- C
riti
ca
l A
cc
ou
nti
ng
Es
tim
ate
s a
nd
Ju
dg
em
en
ts
NO
TES
TO
TH
E A
CC
OU
NTS
IFRS
requ
ires
man
agem
ent t
o m
ake
estim
ates
and
judg
men
ts th
at a
ffec
t the
re
port
ed a
mou
nts
of a
sset
s an
d lia
bilit
ies,
as
wel
l as
inco
me
and
expe
nses
in th
e fin
anci
al s
tate
men
ts. T
he fi
nal r
epor
ted
outc
omes
may
dev
iate
from
the
orig
inal
es
timat
es.
Cer
tain
am
ount
s in
clud
ed in
, or t
hat h
ave
an e
ffec
t on,
the
acco
unts
and
the
as-
soci
ated
not
es re
quire
est
imat
ion,
whi
ch
in tu
rn e
ntai
ls th
at th
e C
ompa
ny m
ust
mak
e as
sess
men
ts re
late
d to
val
ues
and
circ
umst
ance
s th
at a
re n
ot k
now
n at
the
poin
t in
time
whe
n th
e ac
coun
ts a
re p
re-
pare
d. A
sig
nific
ant a
ccou
ntin
g es
timat
e is
an
est
imat
e th
at is
impo
rtan
t to
prov
ide
a co
mpl
ete
pict
ure
of th
e C
ompa
ny’s
fina
n-ci
al p
ositi
on, w
hich
at t
he s
ame
time
is th
e re
sult
of d
ifficu
lt, s
ubje
ctiv
e an
d co
mpl
ex
asse
ssm
ents
per
form
ed b
y th
e m
anag
e-m
ent.
Such
est
imat
es a
re o
ften
unc
erta
in
by n
atur
e. M
anag
emen
t eva
luat
es s
uch
estim
ates
con
tinuo
usly
bas
ed o
n hi
stor
i-ca
l dat
a an
d ex
perie
nce,
con
sulta
tion
with
ex
pert
s, tr
end
anal
ysis
and
oth
er fa
c-to
rs th
at a
re re
leva
nt fo
r the
indi
vidu
al
estim
ate,
incl
udin
g ex
pect
atio
ns o
f fut
ure
even
ts th
at a
re b
elie
ved
to b
e re
ason
able
un
der t
he c
ircum
stan
ces.
Estim
ates
and
ass
umpt
ions
that
hav
e a
sign
ifica
nt ri
sk o
f cau
sing
a m
ater
ial
adju
stm
ent t
o th
e ca
rryi
ng a
mou
nts
of a
s-se
ts a
nd li
abili
ties
with
in th
e ne
xt fi
nanc
ial
year
, as
wel
l as
judg
men
ts m
ade
by m
an-
agem
ent,
in th
e pr
oces
s of
app
lyin
g th
e C
ompa
ny’s
acc
ount
ing
polic
ies,
that
hav
e th
e m
ost s
igni
fican
t eff
ect o
n th
e am
ount
s re
cogn
ized
in th
e fin
anci
al s
tate
men
ts, a
re
disc
usse
d be
low
.
Rev
enue
rec
ogni
tion
– p
erce
ntag
e-of
-co
mpl
etio
n of
f-sh
ore
cabl
e co
ntra
cts
The
Com
pany
use
s th
e pe
rcen
tage
-of-
com
plet
ion
met
hod
in a
ccou
ntin
g fo
r its
fix
ed p
rice
cons
truc
tion
cont
ract
s re
late
d
to th
e se
gmen
t Sub
mar
ine
Pow
er C
able
In
stal
latio
n. O
ne s
igni
fican
t est
imat
e is
an
estim
ate
of th
e pe
rcen
t com
plet
e. M
an-
agem
ent e
stim
ates
com
plet
ion
base
d on
an
ass
essm
ent o
f cer
tain
tech
nica
l crit
eria
in
the
proj
ect e
xecu
tion
plan
that
hav
e to
be
met
in o
rder
to a
chie
ve a
cer
tain
leve
l of
per
cent
age
of c
ompl
etio
n, a
s op
pose
d to
usi
ng c
osts
incu
rred
as
a m
easu
re o
f co
mpl
etio
n.
The
prim
ary
risk
in th
e ex
ecut
ion
of
proj
ects
rela
tes
to th
e of
fsho
re in
stal
la-
tion
phas
e. H
ence
, pro
fit m
argi
n is
not
re
cord
ed u
ntil
the
prog
ress
of t
he p
roje
ct
has
reac
hed
a st
age
of m
inim
um 2
5 pe
r-ce
nt te
chni
cally
com
plet
ion.
The
bel
ow
tabl
e pr
esen
ts a
n ex
ampl
e of
the
vario
us
stag
es d
urin
g a
proj
ect l
ife.
As
pres
ente
d in
the
belo
w ta
ble,
the
proj
ect s
hall
need
to p
rogr
ess
into
the
cabl
e-la
ying
pha
se b
efor
e th
e m
inim
um
25 p
erce
ntag
e of
tech
nica
l com
plet
ion
is
reac
hed.
Prio
r to
reac
hing
a p
rogr
ess
of
min
imum
25
perc
ent t
echn
ical
com
ple-
tion,
and
sub
ject
to a
fore
cast
ed p
ositi
ve
proj
ect m
argi
n, p
roje
ct re
venu
e ar
e ac
-cr
ued
to m
atch
the
actu
al c
osts
incu
rred
.
Perio
dica
l pro
ject
mar
gin
is o
nly
re-
cord
ed w
hen
the
over
all p
roje
ct m
argi
n is
fore
cast
ed to
be
posi
tive,
and
whe
n th
e ex
ecut
ion
of th
e pr
ojec
t has
reac
hed
such
le
vel o
f tec
hnic
al c
ompl
etio
n be
yond
25
perc
ent t
hat t
he m
anag
emen
t is
com
fort
-ab
le to
ass
ess
the
finan
cial
out
com
e of
th
e pr
ojec
t.
The
stag
es o
f com
plet
ion
for a
pro
ject
are
as
follo
ws:
The
sens
itivi
ty o
n th
e re
cord
ed re
venu
e on
lo
ng-t
erm
con
stru
ctio
n co
ntra
cts
wou
ld
be +
/- U
SD 1
4.9
mill
ion
in 2
014,
if m
an-
agem
ent h
ad e
stim
ated
a 1
0%
bett
er/w
orse
pro
gres
s on
the
cont
ract
s pe
r yea
r-en
d 20
14.
Vess
els
Econ
omic
use
ful l
ifeTh
e le
vel o
f dep
reci
atio
n ex
pens
e is
de
pend
ent,
in p
art,
upon
the
estim
ated
us
eful
life
of t
he v
esse
l. Th
e us
eful
life
is
estim
ated
bas
ed o
n hi
stor
ical
dat
a, e
xper
i-en
ce re
late
d to
the
vess
el a
nd s
imila
r ve
ssel
s. T
he e
stim
ate
is re
view
ed a
nd u
p-da
ted
annu
ally
. A c
hang
e in
the
estim
ate
will
aff
ect d
epre
ciat
ion
pros
pect
ivel
y in
cu
rren
t and
futu
re re
port
ing
perio
ds.
Resi
dual
val
ue
The
leve
l of d
epre
ciat
ion
expe
nse
is
depe
nden
t, in
par
t, up
on th
e es
timat
ed
resi
dual
val
ue. M
anag
emen
t est
imat
es
a ve
ssel
’s re
sidu
al v
alue
usi
ng th
eir
know
ledg
e of
the
scra
p va
lue
of v
esse
ls.
The
scra
p va
lue
estim
ates
are
dep
end-
ent o
n th
e pr
ice
of s
teel
. The
scr
ap v
alue
es
timat
e is
bas
ed o
n th
e ex
pect
ed v
alue
at
the
end
of th
e us
eful
life
of t
he v
esse
l. M
anag
emen
t per
form
s an
ann
ual r
evie
w
Pro
ject
Pro
gres
s -
XIte
mP
roje
ct
Pro
gres
s -
wei
ghti
ng
Proj
ect M
anag
emen
t &
XEng
inee
ring
2%
Pre-
Inst
alla
tion
Wor
ks20
%
Cab
le L
ay26
%
Cab
le T
erm
inat
ion
16%
Col
d C
omm
issi
onin
g22
%
Post
Inst
alla
tion
Wor
ks14
%
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
455
Phot
ogra
pher
: Jar
le N
yvol
l, Si
em O
pal
and
asse
ssm
ent o
f the
ves
sel s
crap
val
ue
estim
ates
. Res
idua
l val
ue is
sub
ject
to a
n an
nual
reas
sess
men
t.
Impa
irmen
t of v
esse
ls
On
the
repo
rtin
g da
te, t
he C
ompa
ny h
as
asse
ssed
whe
ther
ther
e ar
e an
y in
dica
-tio
ns th
at it
may
be
nece
ssar
y to
writ
e do
wn
a ve
ssel
. Ind
icat
ors
incl
ude
exte
rnal
br
oker
est
imat
es, s
igni
fican
t cha
nges
in
char
ter h
ire c
ontr
acts
, day
rate
s, o
pera
t-in
g co
sts
or a
dver
se m
arke
t con
ditio
ns.
Whe
n su
ch in
dica
tions
exi
st, a
n im
pair-
men
t tes
t is
perf
orm
ed in
acc
orda
nce
with
C
ompa
ny p
olic
y.
The
reco
vera
ble
valu
e of
the
vess
el is
es
timat
ed, a
nd if
the
reco
vera
ble
amou
nt
is le
ss th
an th
e cu
rren
t car
ryin
g va
lue,
an
impa
irmen
t los
s is
reco
gniz
ed in
the
amou
nt o
f the
diff
eren
ce b
etw
een
carr
y-in
g va
lue
and
net r
ealiz
able
val
ue. T
he re
-co
vera
ble
amou
nt fo
r ves
sels
is e
stim
ated
by
mea
ns o
f bro
ker e
stim
ates
and
val
ue
in u
se c
alcu
latio
ns b
ased
on
proj
ecte
d di
scou
nted
cas
h flo
ws
for t
he re
mai
ning
ch
arte
r hire
per
iod
or o
ver t
he n
ext f
our
year
s if
no c
hart
er c
ontr
act e
xist
s, to
geth
-er
with
an
assu
mpt
ion
of a
term
inal
val
ue
of th
e ve
ssel
. If a
ves
sel i
s fix
ed o
n a
long
co
ntra
ct, t
he C
ompa
ny a
lso
estim
ates
an
exce
ss v
alue
of t
he c
hart
er p
arty
and
this
va
lue
is d
isco
unte
d ba
sed
on a
n es
timat
ed
disc
ount
rate
.
Impa
irm
ent o
f goo
dwill
and
in
tang
ible
ass
ets
The
Com
pany
test
s w
heth
er g
oodw
ill
and
inta
ngib
le a
sset
s ha
ve s
uffe
red
any
impa
irmen
t in
acco
rdan
ce w
ith th
e ac
-co
untin
g po
licy
stat
ed in
not
e 1.
11. T
he
reco
vera
ble
amou
nts
of c
ash-
gene
ratin
g un
it ha
ve b
een
dete
rmin
ed b
ased
on
valu
e-in
-use
cal
cula
tion.
Thi
s ca
lcul
atio
n re
quire
the
use
of e
stim
ates
(Not
e 5)
.
Hed
ge a
ccou
ntin
g
The
Com
pany
use
s he
dge
acco
untin
g fo
r th
e Br
azili
an s
ubsi
diar
y, w
hich
has
a fu
nc-
tiona
l cur
renc
y of
BRL
. The
des
igna
ted
cash
-flow
hed
ge is
a fo
reig
n cu
rren
cy e
x-po
sure
of f
utur
e U
SD c
hart
er h
ire re
venu
e
as th
e he
dged
item
and
USD
long
-ter
m
debt
the
desi
gnat
ed h
edgi
ng in
stru
men
t. D
esig
natio
n of
the
hedg
ed it
em re
quire
s si
gnifi
cant
judg
men
t in
defin
ing
the
futu
re c
hart
er c
ontr
act r
even
ue a
s hi
ghly
pr
obab
le. C
ontr
acts
hav
e be
en w
ritte
n fo
r ves
sels
stil
l und
er c
onst
ruct
ion,
and
so
met
imes
the
deliv
ery
date
of t
he v
esse
l is
del
ayed
. Con
trac
ts h
ave
been
agr
eed
for a
spe
cific
tim
e pe
riod
(e.g
. fou
r to
five
year
s) a
nd h
ave
a re
new
al o
ptio
n.
Hig
hly
prob
able
futu
re c
hart
er re
venu
e ha
s be
en d
eter
min
ed b
y m
anag
emen
t to
incl
ude
the
rene
wal
opt
ion
perio
d, b
ased
on
the
freq
uenc
y of
sim
ilar p
ast t
rans
ac-
tions
and
for t
he c
ontr
acts
to b
e in
clud
ed
in th
e de
sign
ated
hed
ge fr
om th
e da
te o
f si
gnin
g, e
ven
thou
gh th
e ve
ssel
s ar
e un
der
cons
truc
tion.
Sie
m O
ffsh
ore
has
defin
ed
an e
ffec
tive
hedg
e to
be
whe
n th
e ca
sh
flow
s of
the
high
ly p
roba
ble
futu
re tr
ans-
actio
ns a
re h
ighe
r tha
n th
e ca
sh fl
ows
of th
e he
dgin
g in
stru
men
t for
the
sam
e pe
riod.
Eff
ectiv
enes
s te
stin
g is
per
form
ed
usin
g th
e D
olla
r Off
set M
etho
d. S
ee n
ote
12 fo
r add
ition
al in
form
atio
n.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
456
No
te 4
- S
eg
me
nt
Re
po
rtin
g
For r
epor
ting
purp
oses
, the
Com
NO
TES
TO
TH
E A
CC
OU
NTS
(Am
ount
s in
USD
1,0
00)
CO
NSO
LID
ATED
Ope
rati
ng r
even
ue b
y bu
sine
ss a
rea
2014
2013
PSV
(1)
104,
423
94,
630
OSC
V 10
4,84
4 4
1,40
7
AH
TS V
esse
ls (1
)14
2,48
0 1
31,8
94
Vess
els
in B
razi
l, Sm
alle
r bui
lt19
,351
24,
103
Com
bat M
anag
emen
t Sys
tem
s6,
075
7,9
87
Subm
arin
e Po
wer
Cab
le In
stal
latio
n10
1,47
9 2
3,15
1
Scie
ntifi
c C
ore-
Dril
ling
25,9
14 3
6,89
8
Oth
er14
,799
3,8
84
Inte
rcom
pany
elim
inat
ion
(1)
-28,
052
-
Tota
l49
1,31
2 3
63,9
55
Dep
reci
atio
n an
d am
orti
sati
on b
y bu
sine
ss a
rea
PSV
23,4
34 2
1,28
8
OSC
V23
,121
7,0
72
AH
TS V
esse
ls38
,230
38,
883
Vess
els
in B
razi
l, Sm
alle
r bui
lt (2
)31
,865
2,9
89
Subm
arin
e Po
wer
Cab
le In
stal
latio
n1,
530
440
Scie
ntifi
c C
ore-
Dril
ling
3,49
0 3
,264
Oth
er4,
212
1,9
04
Tota
l 1
25,8
83
75,
841
The
Com
pany
iden
tifies
its
repo
rtab
le s
eg-
men
ts a
nd d
iscl
oses
seg
men
t inf
orm
atio
n un
der I
FRS
8 O
pera
ting
Segm
ents
whi
ch
requ
ires
Siem
Off
shor
e In
c to
iden
tify
its
segm
ents
acc
ordi
ng to
the
orga
niza
tion
and
repo
rtin
g st
ruct
ure
used
by
man
agem
ent.
Ope
ratin
g se
gmen
ts a
re c
ompo
nent
s of
a
busi
ness
that
are
eva
luat
ed re
gula
rly
by
the
chie
f ope
ratin
g de
cisi
on m
aker
for t
he
purp
ose
of a
sses
sing
per
form
ance
and
al-
loca
ting
reso
urce
s. T
he C
ompa
ny’s
chi
ef o
p-er
atin
g de
cisi
on m
aker
is th
e m
anag
emen
t bo
ard,
com
pris
ed o
f the
CEO
, CFO
, CO
O
an C
CO
. Gen
eral
ly, fi
nanc
ial i
nfor
mat
ion
is
requ
ired
to b
e di
sclo
sed
on th
e sa
me
basi
s th
at is
use
d by
the
chie
f ope
ratin
g de
cisi
on
mak
er. T
he C
ompa
ny’s
ope
ratin
g se
gmen
ts
repr
esen
t sep
arat
ely
man
aged
bus
ines
s ar
eas
with
uni
que
prod
ucts
ser
ving
diff
eren
t m
arke
ts. T
he re
port
able
seg
men
ts a
re th
e se
ven
busi
ness
are
as P
SV, O
SCV,
AH
TS V
es-
sels
, Oth
er V
esse
ls in
Bra
zil,
Com
bat M
an-
agem
ent S
yste
ms,
Sub
mar
ine
Pow
er C
able
In
stal
latio
n, a
nd S
cien
tific
Cor
e-D
rillin
g.
The
PSV
segm
ent i
nclu
des
12 P
latf
orm
Su
pply
Ves
sels
. The
OSC
V se
gmen
t inc
lude
s fo
ur O
ffsh
ore
Subs
ea C
onst
ruct
ion
Vess
els
and
two
Mul
tipur
pose
fiel
d an
d RO
V Su
ppor
t Ve
ssel
s. T
he A
THS
segm
ent i
nclu
des
ten
Anc
hor H
andl
ing
and
Tug
Supp
ly V
esse
ls.
The
Segm
ent o
f Oth
er V
esse
ls in
Bra
zil
cons
ists
of o
ne O
ilspi
ll Re
cove
ry V
esse
l an
d ei
ght s
mal
ler P
latf
orm
Sup
ply
Vess
els.
C
omba
t Man
agem
ent S
yste
ms
is th
e ac
tivity
of
sup
plyi
ng s
oftw
are
for a
man
agem
ent
syst
em to
the
Braz
ilian
Nav
y. S
ubm
arin
e Po
wer
Cab
le In
stal
latio
n co
mpr
ises
the
activ
ities
of i
nsta
llatio
n a
nd m
aint
enan
ce o
f su
bsea
pow
er c
able
s fo
r off
shor
e w
ind-
farm
s. S
cien
tific
Cor
e-D
rillin
g is
com
pris
ed
of th
e ac
tivity
of a
sci
entifi
c dr
illsh
ip w
hich
pe
rfor
ms
core
drill
ing.
The
seg
men
t Oth
er
is c
ompr
ised
of t
he o
wne
rshi
p of
Sie
m W
IS
that
dev
elop
s ap
plic
atio
ns fo
r man
aged
pr
essu
re d
rillin
g (“
MPD
”), a
nd c
erta
in o
ther
ac
tiviti
es.
Siem
Off
shor
e In
c us
es th
ree
mea
sure
s of
se
gmen
t res
ults
, ope
ratin
g re
venu
e, o
pera
t-in
g m
argi
n an
d ne
t pro
fit.
Inte
rseg
men
t sal
es a
nd tr
ansf
ers
refle
ct
arm
’s le
ngth
pric
es a
s if
sold
or t
rans
ferr
ed
to th
ird p
artie
s at
the
time
of in
cept
ion
of th
e in
tern
al c
ontr
act,
whi
ch m
ay c
over
se
vera
l yea
rs. T
rans
fers
of b
usin
esse
s or
fix
ed a
sset
s w
ithin
or b
etw
een
the
segm
ents
ar
e re
port
ed w
ithou
t rec
ogni
zing
gai
ns o
r lo
sses
. Res
ults
of a
ctiv
ities
not
con
side
red
part
of S
iem
Off
shor
e In
c.’s
mai
n op
erat
ions
as
wel
l as
unal
loca
ted
reve
nues
, exp
ense
s,
liabi
litie
s an
d as
sets
are
repo
rted
toge
ther
w
ith O
ther
und
er th
e ca
ptio
n O
ther
and
el
imin
atio
ns.
The
follo
win
g ta
bles
incl
ude
info
rmat
ion
abou
t the
Com
pany
’s o
pera
ting
segm
ents
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
457
mpa
ny is
org
anis
ed in
to s
even
seg
men
ts, w
hich
are
repr
esen
tativ
e of
its
prin
cipa
l act
iviti
es.
(1) P
SV a
nd A
HTS
Ves
sels
seg
men
ts in
clud
e I/C
Rev
enue
s fr
om c
ontr
actin
g w
ork
for S
ubm
arin
e Po
wer
Cab
le In
stal
latio
n se
gmen
ts.
(2) I
nclu
ding
impa
irmen
t of v
esse
ls a
t USD
29
mill
ions
.
Cap
ital
exp
endi
ture
s by
bus
ines
s ar
ea20
1420
13
PSV
(1)
85,
269
41,
252
OSC
V (1
)28
2,78
6 2
04,7
86
AH
TS V
esse
ls
11,
856
3,9
21
Vess
els
in B
razi
l, Sm
alle
r bui
lt (1
) 7
9,94
4 6
5,23
7
Com
bat M
anag
emen
t Sys
tem
s -
-
Subm
arin
e Po
wer
Cab
le In
stal
latio
n58
,808
4,1
13
Scie
ntifi
c C
ore
Dril
ling
271
2
,814
Oth
er6,
740
7,2
89
Tota
l 5
25,6
74
329
,413
(1) I
nclu
des
new
build
ing
prog
ram
, in
tota
l:33
7,15
730
1,52
0
Boo
k va
lue
by b
usin
ess
area
2014
2013
PSV
(1)
385,
870
343,
463
OSC
V (1
)56
9,04
031
0,40
1
AH
TS V
esse
ls
664,
385
664,
385
Vess
els
in B
razi
l, Sm
alle
r bui
lt (1
)10
5,88
011
2,93
8
Com
bat M
anag
emen
t Sys
tem
s -
-
Subm
arin
e Po
wer
Cab
le In
stal
latio
n72
,666
21,9
77
Scie
ntifi
c C
ore
Dril
ling
26,5
6729
,992
Oth
er60
,765
95,9
15
Tota
l 1,
885,
173
1,5
79,0
71
Oth
er o
pera
ting
profi
t/(lo
ss) i
nclu
des,
am
ong
othe
rs, g
ain
of s
ale
of in
tere
st ra
te d
eriv
ativ
es (C
IRR)
, gai
n/(lo
ss) o
n cu
rren
cy e
xcha
nge
forw
ard
cont
ract
s an
d ge
nera
l and
adm
inis
trat
ion
expe
nses
Ope
rati
ng p
rofit
/(lo
ss) b
y bu
sine
ss a
rea
PSV
(1)
35,4
37 2
1,64
0
OSC
V48
,073
19,
782
AH
TS V
esse
ls (1
)39
,232
29,
023
Vess
els
in B
razi
l, Sm
alle
r bui
lt (2
)-3
5,34
3 3
,750
Com
bat M
anag
emen
t Sys
tem
s-8
1,3
60
Subm
arin
e Po
wer
Cab
le In
stal
latio
n15
,581
3,4
25
Scie
ntifi
c C
ore-
Dril
ling
9,42
9 1
7,13
9
Oth
er-2
8,08
4 -2
6,85
7
Tota
l 8
4,31
6 6
9,26
1
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
458
No
te 5
- V
es
se
ls,
Eq
uip
me
nt,
Pro
jec
t C
os
t a
nd
In
tan
gib
le A
ss
ets
NO
TES
TO
TH
E A
CC
OU
NTS
PAR
ENT
CO
MPA
NY
Vess
els
unde
r co
nstr
ucti
onVe
ssel
s an
d eq
uipm
ent
Dry
-do
ckin
g
- -
- -
- -
- -
- -
- -
-
- -
-
- -
- -
- -
- -
- -
-
- -
-
- -
-
- -
-
- -
- -
- -
- -
- -
- -
-
- -
-
- -
- -
- -
- -
- -
-
- -
-
- -
-
Phot
ogra
pher
: Aril
d Li
llebø
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
459
The
bala
nce
of c
apita
lized
pro
ject
cos
ts re
late
to s
peci
fic c
ontr
acts
. The
cos
ts a
re a
mor
tized
ove
r the
term
of t
he s
peci
fic c
hart
er c
ontr
acts
.
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
Land
and
bu
ildin
gsVe
ssel
s un
der
cons
truc
tion
Vess
els
and
equi
pmen
tD
rydo
ckin
gC
apit
alis
ed
proj
ect c
ost
Purc
hase
cos
t on
Janu
ary
1, 2
013
5,0
69
108
,430
1
,492
,084
3
4,12
1 2
4,43
3
Cap
ital e
xpen
ditu
re
217
2
54,7
31
60,
620
9,9
51
3,6
79
Mov
emen
ts b
etw
een
grou
ps -
- -1
8,06
8 -
-
Vess
els
deliv
ered
in 2
013
- -2
24,3
26
224
,326
-
-
The
year
’s d
ispo
sal a
t cos
t -
- -3
,331
-4
,779
-3
,348
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s -4
33
-11,
124
-29,
947
-848
-
Pur
chas
e co
st o
n D
ecem
ber
31, 2
013
4,8
53
127
,711
1
,725
,682
3
8,44
5 2
4,76
4
Acc
umul
ated
dep
reci
atio
n on
Jan
uary
1, 2
013
-326
-
-243
,278
-2
7,55
2 -1
2,28
0
The
year
’s d
epre
ciat
ion
-118
-
-63,
406
-6,4
67
-4,8
04
Mov
emen
ts b
etw
een
grou
ps -
-18
- -
The
year
’s d
ispo
sal o
f acc
. dep
reci
atio
n -
- 3
,253
4
,549
3
,348
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s 3
2 -
4,0
43
639
-
Acc
umul
ated
dep
reci
atio
n on
Dec
embe
r 31
, 201
3 -4
12
- -2
99,4
05
-28,
831
-13,
736
Net
boo
k va
lue
on D
ecem
ber
31, 2
013
4,4
41
127
,711
1
,426
,277
9
,615
1
1,02
7
Purc
hase
cos
t on
Janu
ary
1, 2
014
4,8
53
127
,711
1
,725
,682
3
8,44
5 2
4,76
4
Cap
ital e
xpen
ditu
re
156
2
90,3
67
206
,281
2
2,28
4 6
,567
Add
itons
from
acq
uisi
tion
of c
ompa
nies
- -
- -
-
Mov
emen
ts b
etw
een
grou
ps -
-4,0
73
24,
918
- -
Vess
els
deliv
ered
in 2
014
- -2
63,7
23
263
,723
-
-
The
year
’s d
ispo
sal a
t cos
t -
- -7
9,95
2 -4
,894
-1
3,73
3
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s -8
81
-5,2
68
-56,
558
-981
-
Pur
chas
e co
st o
n D
ecem
ber
31, 2
014
4,1
28
145
,015
2
,084
,094
5
4,85
5 1
7,59
7
Acc
umul
ated
dep
reci
atio
n on
Jan
uary
1, 2
014
-412
-
-299
,405
-2
8,83
1 -1
3,73
6
The
year
’s d
epre
ciat
ion
-110
-
-79,
604
-9,3
59
-6,6
29
Impa
irmen
t -
14,5
00 -1
4,50
0 -
-
The
year
’s d
ispo
sal o
f acc
. dep
reci
atio
n -
- 1
9,66
6 4
,894
1
3,73
3
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s 9
0 -
7,4
62
727
-
Acc
umul
ated
dep
reci
atio
n on
Dec
embe
r 31
, 201
4 -4
33
-14,
500
-366
,382
-3
2,56
9 -6
,632
Net
boo
k va
lue
on D
ecem
ber
31, 2
014
3,6
95
130
,515
1
,717
,712
22,
285
10,
965
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
460
NO
TES
TO
TH
E A
CC
OU
NTS
The
vess
els
are
divi
ded
into
the
follo
win
g co
mpo
nent
s an
d ec
onom
ical
live
s:
Com
pone
ntPe
rcen
tage
of t
otal
Ec
onom
ic li
fe
Hul
l27
.00%
30 y
ears
Car
go e
quip
men
t17
.00%
30 y
ears
Mar
ine
equi
pmen
t10
.00%
15 y
ears
Cre
w e
quip
men
t9.
00%
15 y
ears
Engi
ne18
.00%
30 y
ears
Engi
ne s
yste
m6.
00%
30 y
ears
Com
bine
d se
wer
age
syst
em
13.0
0%30
yea
rs
Doc
king
2,5
year
s
Equi
pmen
t3
year
s
Inta
ngib
le a
sset
s (A
mou
nts
in U
SD 1
,000
)G
oodw
illR
esea
rch
and
deve
lopm
ent
Trad
emar
ks
and
licen
ces
Tota
l
Bal
ance
on
Janu
ary
1, 2
013
18,
788
3,3
54
9,8
64
32,
006
Mov
ed fr
om V
esse
l and
equ
ipm
ent
- -
-34
-34
Inve
stm
ents
-
216
-
216
Eff
ect o
f exc
hang
e ra
te d
iffer
ence
s 8
41
-291
-4
9 5
01
Pur
chas
e co
st o
n D
ecem
ber
31, 2
013
19,
629
3,2
79
9,7
81
32,
689
Acc
umul
ated
dep
reci
atio
n on
Jan
uary
1, 2
013
- -8
83
-1,1
03
-1,9
86
Mov
ed fr
om V
esse
l and
equ
ipm
ent
- -
- -
The
yea
r’s o
rdin
ary
depr
ecia
tion
-941
-1
06
-1,0
47
Eff
ect o
f exc
hang
e ra
te d
iffer
ence
s -
50
31
82
Acc
umul
ated
dep
reci
atio
n on
Dec
embe
r 31
, 201
3 -
-1,7
74
-1,1
77
-2,9
51
Net
boo
k va
lue
on D
ecem
ber
31, 2
013
19,
629
1,5
05
8,6
04
29,
737
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
461
Impa
irm
ent
The
Com
pany
reco
gniz
ed a
n im
pairm
ent
in th
e fo
urth
qua
rter
of 2
014
amou
ntin
g to
USD
29
mill
ion
rela
ted
to tw
o O
il Sp
ill
Reco
very
ves
sels
(OSR
V) a
nd tw
o PS
V’s
owne
d by
the
Braz
ilian
sub
sidi
ary.
The
im
pairm
ent i
nclu
des
one
vess
el th
at w
ere
unde
r con
stru
ctio
n w
ith a
n es
timat
ed
com
plet
ion
and
deliv
ery
date
of t
hird
qu
arte
r 201
5. D
urin
g fo
urth
qua
rter
201
4 br
oker
est
imat
es, b
ased
on
com
plet
ed
vess
els
in u
se b
ut a
ssum
ing
no c
har-
ter h
ire c
ontr
acts
in p
lace
, ind
icat
ed
a po
ssib
le im
pairm
ent a
s th
e br
oker
fa
ir va
lue
was
low
er th
an th
e ve
ssel
s’
curr
ent c
arry
ing
valu
e. A
n im
pairm
ent
test
usi
ng a
val
ue in
use
cal
cula
tion
and
estim
ated
futu
re n
et c
ash
flow
s ba
sed
on
actu
al a
gree
d ch
arte
r hire
con
trac
ts, w
as
perf
orm
ed. T
he in
tern
ally
est
imat
ed fa
ir va
lue,
bas
ed o
n th
e ne
t pre
sent
val
ue o
f th
e fu
ture
cas
h flo
ws,
was
hig
her t
han
the
brok
er e
stim
ates
, but
stil
l low
er th
an th
e ca
rryi
ng a
mou
nt, b
y U
SD 2
9 m
illio
n.
For a
ll ot
her v
esse
ls o
wne
d by
the
com
-pa
ny a
val
ue in
use
cal
cula
tion
has
been
m
ade,
whe
re th
e va
lue
of th
e ch
arte
r hire
is
bas
ed o
n th
e ac
tual
cha
rter
hire
per
iod,
an
ant
icip
ated
util
izat
ion
rate
of 9
8.5%
, op
erat
ing
expe
nses
cal
cula
ted
per d
ay,
base
d on
his
toric
al d
ata,
and
a p
re-t
ax
wei
ghte
d av
erag
e co
st o
f cap
ital (
WA
CC
) of
6.6
%. T
he re
cove
rabl
e am
ount
of e
ach
vess
el, c
onsi
stin
g of
the
fair
mar
ket v
alue
of
the
vess
els,
est
imat
ed b
y di
ffer
ent
inde
pend
ent s
hipb
roke
rs a
nd th
e va
lue
in
use
calc
ulat
ion
as p
er 3
1 D
ecem
ber 2
014
of th
e ch
arte
r hire
per
iod
com
men
cing
fr
om 1
Jan
uary
201
5, e
xcee
ds th
e ca
r-ry
ing
amou
nt fo
r all
vess
els
as o
f 31
De-
cem
ber 2
014.
No
impa
irmen
t is
ther
efor
e re
cogn
ized
as
of y
ear-
end
2014
for o
ther
ve
ssel
s ow
ned
by th
e C
ompa
ny.
Inta
ngib
le a
sset
s (A
mou
nts
in U
SD 1
,000
) G
oodw
ill
Res
earc
h an
d de
velo
pmen
tTr
adem
arks
an
d lic
ence
sTo
tal
Bal
ance
on
Janu
ary
1, 2
014
19,
628
3,2
78
9,7
82
32,
688
Mov
ed fr
om V
esse
l and
equ
ipm
ent
- -
- -
Inve
stm
ents
-
19
- 1
9
Eff
ect o
f exc
hang
e ra
te d
iffer
ence
s -2
,310
-5
94
-98
-3,0
02
Pur
chas
e co
st o
n D
ecem
ber
31, 2
014
17,
318
2,7
04
9,6
84
29,
705
Acc
umul
ated
dep
reci
atio
n on
Jan
uary
1, 2
014
- -1
,773
-1
,177
-2
,951
Mov
ed fr
om V
esse
l and
equ
ipm
ent
- -
- -
The
yea
r’s o
rdin
ary
depr
ecia
tion
-1,0
74
-90
-1,1
63
Eff
ect o
f exc
hang
e ra
te d
iffer
ence
s -
260
8
7 3
46
Acc
umul
ated
dep
reci
atio
n on
Dec
embe
r 31
, 201
4 -
2,5
88
-1,1
80
-3,7
68
Net
boo
k va
lue
on D
ecem
ber
31, 2
014
17,
318
116
8,5
03
25,
937
Trad
emar
ks a
nd li
cenc
es re
fer t
o Si
em W
IS A
S pa
tent
ed te
chno
logy
for t
he d
rillin
g in
dust
ry. T
he fi
gure
s in
clud
e as
sets
und
er d
evel
op-
men
t and
dev
elop
ed a
sset
s, a
nd th
e de
prec
iatio
n re
fers
to d
evel
oped
ass
ets
that
are
not
yet
com
mer
cial
ized
. Sh
are
issu
e in
Sie
m W
IS c
ompl
eted
in 2
014
appr
ecia
te th
e C
ompa
ny’s
60%
ow
ner s
hare
to U
SD 1
5,04
3. T
his
valu
e in
dica
tes
that
ther
e is
no
impa
irmen
t los
s fo
r the
cap
italiz
ed tr
adem
arks
and
lice
nces
.Th
e ca
rryi
ng a
mou
nt o
f goo
dwill
is re
late
d to
the
Subm
arin
e Po
wer
Cab
le In
stal
latio
n Se
gmen
t.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
462
The
book
val
ue in
Sie
m O
ffsh
ore
do B
rasi
l SA
was
incr
ease
d w
ith U
SD 2
8.6
mill
ion,
Sie
m O
ffsh
ore
Man
agem
ent A
S w
ith
USD
4.3
mill
ion
and
Siem
Off
shor
e In
vest
AS
with
USD
0.3
8 m
illio
n in
201
4.
Th
e ab
ove
com
pani
es a
re o
wne
d by
the
Pare
nt. I
n ad
ditio
n, th
e su
bsid
iarie
s ow
n th
e fo
llow
ing
com
pani
es:
No
te 6
- I
nve
stm
en
t in
Su
bs
idia
rie
s
NO
TES
TO
TH
E A
CC
OU
NTS
Com
pany
Reg
iste
red
offic
eSh
are
and
voti
ng r
ight
s
Con
sub
Del
awar
e LL
CD
elaw
are,
USA
100%
Ara
caju
Ser
viço
s A
uxili
ares
Ltd
aRi
o de
Jan
eiro
, Bra
zil
100%
Siem
Off
shor
e C
rew
ing
AS
Kris
tians
and,
Nor
way
100%
Siem
Mel
ing
Off
shor
e D
ASt
avan
ger,
Nor
way
51%
Næ
rings
bygg
Indr
etts
veie
n 13
DA
Fjel
l, N
orw
ay95
%
Siem
WIS
AS
Berg
en, N
orw
ay
60%
Siem
Off
shor
e M
ariti
me
Pers
onne
l AS
Kris
tians
and,
Nor
way
100%
Siem
Off
shor
e C
ontr
acto
rs G
mbH
Leer
, Ger
man
y10
0%
Siem
Off
shor
e C
ontr
acto
rs E
PS B
VG
limm
en, T
he N
ethe
rlan
ds10
0%
AH
MTE
C G
mbH
Leer
, Ger
man
y10
0%
Ove
rsea
s D
rillin
g Lt
dG
roni
ngen
, The
Net
herl
ands
100%
Siem
Off
shor
e C
anad
a In
cH
alifa
x, C
anad
a10
0%
Siem
Off
shor
e Po
land
Sp.
z.O
.OG
dyni
a, P
olan
d10
0%
Siem
Off
shor
e A
ustr
alia
Pert
h, A
ustr
alia
100%
Siem
Rea
l Est
ate
Gm
bHLe
er, G
erm
any
100%
Com
pany
(Am
ount
s in
USD
1,0
00)
Reg
iste
red
offic
eO
wne
rshi
p an
d vo
ting
sha
reR
even
ue
Siem
Off
shor
e A
SK
ristia
nsan
d, N
orw
ay10
0% 1
1,17
6
Siem
Off
shor
e In
vest
AS
Kris
tians
and,
Nor
way
100%
21,
540
Siem
Off
shor
e Re
deri
AS
Kris
tians
and,
Nor
way
100%
205
,659
Siem
Off
shor
e do
Bra
sil S
ARi
o de
Jan
eiro
, Bra
zil
100%
54,
953
Siem
Off
shor
e U
S In
cD
elaw
are,
USA
100%
-
Siem
AH
TS P
ool A
SK
ristia
nsan
d, N
orw
ay10
0% 1
25,3
70
DSN
D S
ubse
a Lt
dLo
ndon
, UK
100%
-
Siem
Off
shor
e Se
rvic
es A
SK
ristia
nsan
d, N
orw
ay10
0% 3
4,48
6
Siem
Off
shor
e M
anag
emen
t AS
Kris
tians
and,
Nor
way
100%
13,
615
Siem
Off
shor
e M
anag
emen
t (U
S) In
cTe
xas,
USA
100%
454
Siem
Off
shor
e U
S H
oldi
ng A
S K
ristia
nsan
d, N
orw
ay10
0% -
Siem
Off
shor
e C
rew
ing
(CI)
Inc
Cay
man
Isla
nds
100%
322
Tota
l val
ue r
ecor
ded
in th
e st
atem
ent o
f fina
ncia
l pos
itio
n of
the
pare
nt c
ompa
ny
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
463
Ther
e ar
e no
sig
nific
ant r
estr
ictio
ns w
ithin
the
grou
p (e
g st
atut
ory,
con
trac
tual
and
regu
lato
ry re
stric
tions
) red
ucin
g th
e ab
ility
of t
he
pare
nt c
ompa
ny o
r sub
sidi
arie
s to
tran
sfer
cas
h or
oth
er a
sset
s to
or f
rom
oth
er e
ntiti
es w
ithin
the
Gro
up.
Exce
pt fo
r cer
tain
regu
latio
ns in
Bra
zil a
s de
scrib
ed b
elow
, the
re a
re n
o gu
aran
tees
or o
ther
requ
irem
ents
that
may
rest
rict d
ivid
ends
an
d ot
her c
apita
l dis
trib
utio
ns b
eing
pai
d, o
r loa
n an
d ad
vanc
es b
eing
mad
e or
repa
id to
or f
rom
oth
er e
ntiti
es w
ithin
the
grou
p.
Repa
ymen
t of l
oans
pro
vide
d to
the
Braz
ilian
sub
sidi
ary
of th
e gr
oup
may
cau
se a
with
hold
ing
tax
on th
e re
paid
am
ount
.
The
shar
es in
Sie
m O
ffsh
ore
Bras
il SA
wer
e w
ritte
n do
wn
by U
SD 2
9 m
illio
n du
e to
impa
irmen
t of f
our v
esse
ls.
The
shar
es in
Sie
m O
ffsh
ore
Inve
st A
S w
ere
writ
ten
dow
n by
USD
20
mill
ion
due
to o
vers
tate
men
t of t
he s
hare
val
ue in
OD
L.
Net
pro
fitSh
are
capi
tal
Boo
k eq
uity
Cos
t pri
ceB
ook
valu
e
-29
35
7,4
21
7,5
97
7,5
97
-17,
151
898
9
4,67
3 9
7,11
7 77
,117
100
,222
6
,175
7
42,9
94
583
,396
5
83,3
96
-24,
458
97,
169
2,6
06
96,
741
67,7
41
-20
- 5
,307
-
-
5,2
06
17
6,3
04
21
21
-5
0
-209
1
8,35
2 0
3,9
89
18
4,2
52
292
2
92
1,2
05
17
2,8
06
5,1
27
5,1
27
47
1
173
1
1
- 5
-1
96
5
5
270
5
0 1
,027
5
0 5
0
867
,158
8
08,7
00
741,
348
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
464
Figu
res
for a
ssoc
iate
d co
mpa
nies
incl
uded
in th
e co
nsol
idat
ed a
ccou
nts
base
d on
the
equi
ty a
ccou
ntin
g.
No
te 7
- I
nve
stm
en
t in
As
so
cia
ted
Co
mp
an
ies
NO
TES
TO
TH
E A
CC
OU
NTS
Dec
embe
r 31
, 201
4 (A
mou
nts
in U
SD 1
,000
)
Com
pany
nam
e
PR
Tra
cer
Off
shor
e A
NS
KS
Big
O
rang
e XV
III
Rov
de
Indu
stri
-pa
rk A
S
Sent
osa
Off
shor
e D
IS
Secu
nda
Hol
ding
s LP
Tota
l
The
year
’s n
et p
rofit
aft
er ta
x 1
,666
5
91
43
1,5
46
2,3
49
6,1
95
Siem
Off
shor
e´s
shar
e of
net
pro
fit 6
89
244
2
1 7
7 1
,174
2
,205
Adj
ustm
ents
con
solid
ated
acc
ount
s -7
7 -
-17
- -3
04
-451
This
yea
r`s
shar
e of
net
pro
fit a
fter
tax
612
2
44
4 7
7 8
71 1
,808
Stat
emen
t of fi
nanc
ial p
osit
ion
Non
.cur
rent
ass
ets
1,47
2-
1,47
315
,816
40,8
0159
,562
Cur
rent
ass
ets
624
135
406
2233
,605
34,7
92
Cas
h1,
657
2,20
315
1,15
51,
625
6,65
5
Tota
l ass
ets
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1,8
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031
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Equi
ty 3
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2
,338
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75
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63
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Non
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rent
liab
ilitie
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075
14,6
0627
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43,3
84
Cur
rent
liab
ilitie
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41-
4412
516
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68
Tota
l lia
bilit
ies
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-
1,1
19
14,
731
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143
59,
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Tota
l equ
ity
and
liabi
litie
s 3
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2
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1
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1
6,99
3 7
6,03
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01,0
09
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
465
Com
pany
nam
eR
egis
tere
d of
fice
Con
solid
ated
as
Ow
ner
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rest
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ng
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tsPa
id in
ca
pita
lIs
sued
, not
pai
d in
cap
ital
PR T
race
r Off
shor
e A
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tians
and,
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way
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ty a
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ristia
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ayEq
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ripar
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222
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osa
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shor
e D
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way
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Hal
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Equi
ty a
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50.0
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5,51
9
Tota
l 2
4,89
5 5
Dec
embe
r 31
, 201
4 (A
mou
nts
in U
SD 1
,000
)
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pany
nam
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race
r O
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S
KS
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rang
e XV
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Rov
de
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stri
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rk A
S
Sent
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shor
e D
IS
Secu
nda
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ding
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Tota
l
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ty 1
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66
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1
13
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944
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Add
ed/r
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the
peri
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Adj
ustm
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and
fair
valu
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ess
of b
ook
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e
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l and
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373
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Net
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iem
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of D
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31 1
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1,
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4620
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Ow
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rest
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Spec
ifica
tion
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hang
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ook
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Sie
m O
ffsh
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ts
Net
boo
k va
lue
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f Jan
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Inve
stm
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n as
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pani
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rofit
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ct o
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Net
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k va
lue
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r 31
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Of w
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ents
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and
fair
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ess
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Exce
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alue
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or d
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Am
ortis
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r ves
sels
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Effe
ct o
f exc
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te d
iffer
ence
s-
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Fair
val
ue in
exc
ess
of b
ook
valu
e fo
rve
ssel
s an
d go
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ill a
s of
Dec
embe
r. 31
-37
315
714
448
21,
156
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
466
NO
TES
TO
TH
E A
CC
OU
NTS
Dec
embe
r 31
, 201
3 (A
mou
nts
in U
SD 1
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)
Com
pany
nam
e
PR
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cer
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shor
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NS
KS
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nd lo
ss a
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nt
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year
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rofit
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6
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1
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9
Siem
Off
shor
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shar
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net
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fit 1
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2
59
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Shar
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t inc
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Adj
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1,0
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Stat
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Non
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186
9
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1
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ity
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liabi
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s 2
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3
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08,6
23
SIEM
OFF
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RE IN
C., A
NN
UA
L RE
PORT
201
467
Com
pany
nam
eC
onso
lidat
ed a
s
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ner
inte
r-es
tVo
ting
ri
ghts
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in
capi
tal
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ed, n
ot
paid
in c
apit
al
PR T
race
r Off
shor
e A
NS
Equi
ty a
ccou
ntin
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acc
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5
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222
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ISEq
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-
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s LP
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9
29
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39
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127
19,
148
Add
ed/r
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the
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od
Cha
nge
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and
fair
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of b
ook
valu
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for v
esse
l and
goo
dwill
as
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ber 3
1 7
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55
203
1
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1
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Net
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k va
lue
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iem
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shor
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of D
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31 1
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1
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6
56
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Ow
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rest
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Spec
ifica
tion
of c
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es n
et b
ook
valu
e in
Sie
m O
ffsh
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s ac
coun
ts
Net
boo
k va
lue
as o
f Jan
uary
11,
615
1,23
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3 65
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4,2
22
Inve
stm
ent i
n as
soci
ated
com
pani
es -1
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-
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15,
519
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r’s s
hare
of n
et p
rofit
1,34
9 25
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8
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solid
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s-3
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542
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ct o
f exc
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s-1
45
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53
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Net
boo
k va
lue
as o
f Dec
embe
r 31
1,3
78
1,3
84
656
5
19
17,
009
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and
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valu
e
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esse
l and
goo
dwill
as
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anua
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234
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0 1
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Exce
ss v
alue
00
00
993
993
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ent f
or d
epre
ciat
ion
IFRS
-328
-
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11
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Am
ortis
atio
n of
fair
valu
e in
exc
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of
book
val
ue fo
r ves
sels
and
goo
dwill
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-
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ct o
f exc
hang
e ra
te d
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s -1
5 -4
2 -2
0 -1
8 0
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4
Fair
val
ue in
exc
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of b
ook
valu
e fo
r ve
ssel
s an
d
go
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s of
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embe
r 31
77
455
203
180
882
1,79
7
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
468
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 8
- P
en
sio
n C
os
ts a
nd
Ob
lig
ati
on
s
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
2014
2013
The
amou
nt r
ecog
nize
d in
the
inco
me
stat
emen
t is
as fo
llow
s:
Serv
ice
cost
2,53
52,
688
Inte
rest
exp
ence
9388
Adm
inis
trat
ion
cost
2529
Soci
al c
ontr
ibut
ion
266
314
Impa
ct o
f cur
tailm
ent/
sett
lem
ent
-768
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32
Net
per
iodi
c pe
nsio
n co
st (s
ee N
ote
19)
2,1
51 1
,887
The
deve
lopm
ent i
n th
e de
fined
ben
efit o
blig
atio
n is
as
foll
ows:
Begi
nnin
g of
yea
r12
,911
12,
853
Cur
rent
ser
vice
cos
t2,
535
2,6
88
Inte
rest
exp
ence
506
466
Aqu
isiti
on (d
ispo
sal)
- -2
,350
Payr
oll t
ax o
f em
ploy
er c
ontr
ibut
ion,
ass
ets
-315
-437
Bene
fits
paid
-350
-386
Rem
easu
rem
ents
loss
/(ga
in)
42 8
40
Exch
ange
diff
eren
ces
-2,7
83 -7
63
End
of y
ear
12,
546
12,
911
The
deve
lopm
ent i
n th
e fa
ir v
alue
of p
lan
asse
ts is
as
foll
ows:
Begi
nnin
g of
yea
r10
,133
12,
251
Inte
rest
inco
me
413
378
Acq
uisi
tion
(dis
posa
l)-
-3,9
33
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inis
trat
ion
cost
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Empl
oyer
con
trib
utio
n2,
548
3,5
36
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ax o
f em
ploy
er c
ontr
ibut
ion,
ass
ets
-315
-437
Bene
fits
paid
-303
-297
Rem
easu
rem
ents
loss
/(ga
in)
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03 -4
23
Exch
ange
diff
eren
ces
-1,9
38 -9
42
End
of y
ear
8,7
35
10,
133
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
469
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
2014
2013
Pres
ent v
alue
of f
unde
d ob
ligat
ions
12,
546
12,
911
Fair
valu
e of
pla
n as
sets
-8,7
35
-10,
133
Soci
al c
ontr
ibut
ion
- -
Unr
ecog
nize
d ne
t act
uaria
l los
s/(g
ain)
- -
Pre
sent
val
ue o
f fun
ded
oblig
atio
ns 3
,812
2
,778
Pres
ent v
alue
of u
nfun
ded
oblig
atio
ns -
-
Liab
ility
in th
e st
atem
ent o
f fina
ncia
l pos
itio
n 3
,812
2
,778
Fina
ncia
l ass
umpt
ions
:
Dis
coun
t rat
e2.
30%
4.00
%
Expe
cted
retu
rn o
n fu
nds
2.30
%4.
00%
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cted
wag
e ad
just
men
t2.
75%
3.75
%
Adj
ustm
. of t
he b
asic
Nat
iona
l Ins
ur. a
mou
nt2.
50%
3.50
%
Expe
cted
pen
sion
incr
ease
0.00
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60%
Dev
elop
men
t las
t tw
o ye
ars
2014
2013
Dec
embe
r 31
Pres
ent v
alue
of d
efine
d be
nefit
obl
igat
ion
12,5
4612
,911
Fair
valu
e of
pla
n as
sets
8,73
510
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cit i
n th
e pl
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812
2,77
8
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just
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ts o
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abili
ties,
gai
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ss)
--
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n pl
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sset
s, g
ain/
(loss
)-
-
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
470
USD
29,
426
of th
e C
ompa
ny’s
cas
h ba
lanc
e at
yea
rs e
nd w
as re
stric
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SD 1
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27,6
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pres
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curit
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r ban
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and
loan
s.
NO
TES
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NTS
No
te 9
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ec
eiv
ab
les
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te 1
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str
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as
h
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utst
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ng in
sura
nce
clai
ms
refe
r to
brea
kdow
n ex
pens
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ualif
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for i
nsur
ance
cov
er. T
he a
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nt is
less
ow
n de
duct
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(2
) Oth
er s
hort
term
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ivab
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loan
to S
ecun
da H
oldi
ngs
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t USD
2.8
mill
ion,
refu
nds
from
NIS
/NO
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USD
1.0
mill
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re
imbu
rsab
les
in B
razi
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illio
n, A
HTS
Poo
l acc
rual
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USD
5.4
mill
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and
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r acc
rual
s at
USD
1.9
mill
ion
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
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2013
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
Long
-ter
m r
ecei
vabl
es
- -
Dep
osits
-
-
3,8
07
5,3
54
Empl
oyee
loan
s, s
ee N
ote
19 4
,076
5
,683
26,
246
41,
740
Inte
rcom
pany
rece
ivab
les
- -
- -
Proj
ect r
elat
ed p
repa
ymen
t -
-
- -
Oth
er lo
ng te
rm re
ceiv
able
s (1
) 1
9,35
4 9
56
30,
053
47,
094
Tota
l lon
g-te
rm r
ecei
vabl
es 2
3,43
2 6
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(1) I
nclu
ding
long
term
loan
USD
18.
6 m
illio
n to
Sie
m In
dust
ries
Inc.
12/3
1/20
1412
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2013
Oth
er s
hort
-ter
m r
ecei
vabl
es12
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2014
12/3
1/20
13
3
2
Prep
aid
expe
nses
29,
150
9,2
53
- -
Unb
illed
reve
nue
8,2
14
11,
719
- -
Out
stan
ding
insu
ranc
e cl
aim
s (1
) 9
,476
4
,898
- -
Prep
aid
inco
me
taxe
s an
d ot
her t
axes
3,7
55
4,2
64
- 1
07
VAT
242
8
4
17,
340
5,0
98
Inte
rcom
pany
rece
ivab
les
- -
- 2,
133
Oth
er s
hort
-ter
m re
ceiv
able
s (2
) 1
3,03
9 2
,519
17,
343
7,34
0To
tal o
ther
sho
rt-t
erm
rec
eiva
bles
63,
877
32,
737
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
471
No
te 1
1 -
Ta
xe
s
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
2014
2013
Tem
pora
ry d
iffer
ence
s
Def
erre
d ta
xTi
me
fram
e
Part
icip
atio
n in
lim
ited
liabi
lity
com
pani
esLo
ng -
-
Ope
ratin
g as
sets
Long
-37,
921
-39,
922
Spec
ial t
ax a
ccou
ntLo
ng -
-
Pens
ion
fund
s/ob
ligat
ions
Long
-3,8
12
-2,7
78
Oth
er s
hort
-ter
m d
iffer
ence
sSh
ort
- -
Oth
er lo
ng-t
erm
diff
eren
ces
Long
2,3
52
-3,7
45
Net
tem
pora
ry d
iffer
ence
s as
of D
ecem
ber
31 -3
9,38
1 -4
6,44
7
Tax
loss
car
ried
forw
ard
-30,
265
-21,
851
Bas
is fo
r de
ferr
ed ta
x (t
ax a
sset
) -6
9,64
6 -6
8,29
8
Def
erre
d ta
x (t
ax a
sset
) Nor
way
-2,6
04
-1,7
58
Def
erre
d ta
x (t
ax a
sset
) Hol
land
-3,7
85
-3,9
94
Def
erre
d ta
x (t
ax a
sset
) Ger
man
y -6
,203
-6
,019
Def
erre
d ta
x (t
ax a
sset
) -1
2,59
1 -1
1,77
0
Def
erre
d ta
x as
set r
ecog
nize
d in
sta
tem
ent
of
--fin
anci
al p
osit
ion
as o
f Dec
embe
r 31
-1
2,59
1
-11,
770
Ther
e ar
e no
tax
asse
ts in
the
pare
nt c
ompa
ny.
Def
erre
d ta
x as
sets
are
reco
gniz
ed a
s in
tang
ible
ass
ets
as it
is p
roba
ble
thro
ugh
pros
pect
ive
earn
ings
that
it c
an b
e ut
ilize
d.
The
Com
pany
is s
ubje
ct to
taxe
s in
sev
eral
juris
dict
ions
, whe
re s
igni
fican
t jud
gmen
t is
requ
ired
in c
alcu
latin
g th
e ta
x pr
ovis
ion
for t
he C
om-
pany
. The
re a
re s
ever
al tr
ansa
ctio
ns fo
r whi
ch th
e ul
timat
e ta
x co
st is
unc
erta
in a
nd fo
r whi
ch th
e Co
mpa
ny m
akes
pro
visi
ons
base
d on
an
as-
sess
men
t of i
nter
nal e
stim
ates
, tax
trea
ties
and
tax
regu
latio
ns in
cou
ntrie
s of
ope
ratio
n, a
nd a
ppro
pria
te e
xter
nal a
dvic
e. W
here
the
final
tax
outc
ome
of th
ese
mat
ters
is d
iffer
ent f
rom
the
amou
nts
that
wer
e in
itial
ly re
cord
ed, s
uch
diffe
renc
e w
ill im
pact
the
tax
char
ge in
the
perio
d in
w
hich
the
outc
ome
is d
eter
min
ed.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
472
NO
TES
TO
TH
E A
CC
OU
NTS
Ove
rpro
visi
on in
pre
viou
s ye
ar re
late
s to
act
ivity
on
Gre
enla
nd fo
r the
sub
sidi
ary
Ove
rsea
s D
rillin
g Li
mite
d.A
ctua
l tax
liab
ility
was
dec
reas
ed c
ompa
red
to b
udge
t tak
ing
into
con
side
ratio
n lo
cal t
ax le
gisl
atio
n.
2014
2013
Tonn
age
tax
regi
me
in s
ubsi
diar
ies,
as
of J
anua
ry 1
39
964
Tax
char
ge
2
39
Paid
-15
-949
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s -4
-1
5
Tota
l ton
nage
tax
in s
ubsi
diar
ies,
as
of D
ecem
ber
31 2
2 3
9
Tota
l tax
con
solid
ated
12
/31/
2014
(Am
ount
s in
USD
1,0
00)
Tonn
age
tax
regi
me
Oth
er ta
x re
gim
eTo
tal t
ax
liabi
litie
s
Long
term
tax
liabi
litie
s fa
lling
due
aft
er 1
yea
r -
6,3
68
6,3
68
Paya
ble
taxe
s fa
lling
due
with
in 1
yea
r 2
2 4
,983
5
,005
Tax
liabi
litie
s 2
2 1
1,35
1 1
1,37
3
Tax
expe
nse
2014
(Am
ount
s in
USD
1,0
00)
Tonn
age
tax
regi
me
Oth
er ta
x re
gim
eTo
tal t
ax
expe
nse
Taxe
s pa
yabl
e 2
3
,939
3
,941
Cha
nge
in d
efer
red
tax/
defe
rred
tax
asse
t -
-1,1
79
-1,1
79
Ove
r/un
der p
rovi
sion
s in
pre
viou
s ye
ar -
-33
-33
Tota
l 2
2
,726
2
,729
Tota
l tax
con
solid
ated
12
/31/
2014
(Am
ount
s in
USD
1,0
00)
Tonn
age
tax
regi
me
Oth
er ta
x re
gim
eTo
tal t
ax li
-ab
iliti
es
Long
term
tax
liabi
litie
s fa
lling
due
aft
er 1
yea
r -
6,6
79
6,6
79
Paya
ble
taxe
s fa
lling
due
with
in 1
yea
r 3
9 3
,721
3
,759
Tax
liabi
litie
s 3
9 1
0,40
0 1
0,43
9
Tax
expe
nse
2013
(Am
ount
s in
USD
1,0
00)
Tonn
age
tax
regi
me
Oth
er ta
x re
gim
eTo
tal t
ax e
x-pe
nse
Taxe
s pa
yabl
e 3
9 3
,364
3
,403
Cha
nge
in d
efer
red
tax/
defe
rred
tax
asse
t -
-5,6
50
-5,6
50
Ove
r/un
der p
rovi
sion
s in
pre
viou
s ye
ar -
-1,3
37
-1,3
37
Tota
l 3
9 -3
,624
-3
,585
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
473
Tota
l tax
par
ent c
ompa
ny
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
Long
term
tax
liabi
litie
s fa
lling
due
aft
er 1
yea
r 4
,885
4
,885
Paya
ble
taxe
s fa
lling
due
with
in 1
yea
r -1
46
-673
Tax
liabi
litie
s 4
,738
4
,212
2014
2013
Taxe
s pa
yabl
e -
261
Tota
l -
261
Phot
ogra
pher
: Ant
onio
Mla
dino
v,
Siem
N-S
ea
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
474
(1) U
nder
the
USD
62.
8 m
illio
n fa
cilit
y, p
art o
f the
loan
(USD
30.
2 m
illio
n) is
fixe
d fo
r a 7
-yea
r ter
m to
ave
rage
inte
rest
rate
of 7
.58%
. (2
) Und
er th
e N
OK
365
.1m
illon
faci
lity,
par
t of t
he lo
an (e
quiv
alen
t to
USD
25.
0 m
illio
n) is
fixe
d fo
r an
appr
oxim
atel
y 9-
year
term
to
ave
rage
inte
rest
rate
of 5
.36%
.(3
) Und
er th
e N
OK
222
mill
ion
faci
lity
a m
ajor
ity o
f the
loan
is fi
xed
for a
5-y
ear t
erm
to a
n av
erag
e in
tere
st o
f 4.1
8%.
(4) T
he U
SD 2
34.1
mill
ion
faci
lity
has
a ba
lloon
repa
ymen
t in
2015
. The
term
for t
his
debt
sha
ll ei
ther
be
auto
mat
ical
ly e
xten
ded
or
rene
gotia
ted
subj
ect t
o ce
rtai
n re
quire
men
ts re
gard
ing
vess
el e
mpl
oym
ent.
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 1
2 -
Bo
rro
win
gs
2014
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
CO
NSO
LID
ATED
(USD
)Lo
anC
urre
ncy
Com
mit
ted
Faci
lity
amou
nt c
urre
ncy
Dra
wn
amou
nt
curr
ency
Dra
wn
amou
nt
USD
- U
SD 7
9,13
2 7
9,13
2 7
9,13
2
- U
SD (
1) 6
2,79
1 6
2,79
1 6
2,79
1
- N
OK
(4)
1,7
40,2
47
- 2
34,1
18
- N
OK
320
,762
-
43,
153
- U
SD 1
9,60
0 1
9,60
0 1
9,60
0
- U
SD 1
6,48
2 1
6,48
2 1
6,48
2
- U
SD 1
14,0
85
114
,085
1
14,0
85
- U
SD 5
4,59
8 4
9,74
0 4
9,74
0
- N
OK
(2)
365
,137
3
65,1
37
49,
123
- N
OK
4,6
55
4,6
55
626
- N
OK
3,0
60
3,0
60
412
- N
OK
12,
364
12,
364
1,6
63
80,
719
NO
K 6
00,0
00
600
,000
8
0,71
9
- N
OK
2,3
51,7
00
2,1
97,3
33
295
,611
- N
OK
240
,000
2
40,0
00
32,
288
- N
OK
(3)
222
,167
2
07,8
33
27,
960
- N
OK
435
,000
-
-
- N
OK
360
,000
-
-
- EU
R 4
9,77
0 2
1,33
0 2
5,93
1
94,
172
NO
K 7
00,0
00
700
,000
9
4,17
2
174
,891
To
tal s
ecur
ed d
ebt
1,2
27,6
05
- 10
Fees
and
exp
ense
s -1
3,24
5
174
,881
To
tal
1,2
14,3
60
28,
453
(CIR
R lo
an) N
OK
211
,500
2
11,5
00
28,
453
203
,334
To
tal l
ong-
term
deb
t inc
ludi
ng fe
es a
nd e
xpen
ses
1,2
42,8
13
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
475
Dec
embe
r 31
, 201
4
Fair
val
ueIn
tere
st r
ate
Dur
atio
nIn
stal
men
ts
79,
132
Floa
ting
2017
Qua
rter
ly
67,
251
Fixe
d an
d flo
atin
g20
21Se
mi a
nnua
lly
234
,118
Fl
oatin
g20
15Se
mi a
nnua
lly
43,
153
Floa
ting
2022
Qua
rter
ly
19,
600
Floa
ting
2019
Sem
i ann
ually
16,
310
Fixe
d20
27M
onth
ly
115
,824
Fi
xed
2028
Mon
thly
52,
980
Fixe
d20
31M
onth
ly
51,
811
Fixe
d an
d flo
atin
g20
23Se
mi a
nnua
lly
626
Fl
oatin
g20
19Q
uart
erly
412
Fl
oatin
g20
19M
onth
ly
1,6
63
Floa
ting
2019
Mon
thly
80,
719
Floa
ting
2018
Bulle
t
305
,205
Fi
xed
2018
Sem
i ann
ually
32,
288
Floa
ting
2019
Sem
i ann
ually
29,
653
Fixe
d or
floa
ting
2019
Sem
i ann
ually
- Fi
xed
or fl
oatin
g20
27Se
mi a
nnua
lly
- Fi
xed
or fl
oatin
g20
27Se
mi a
nnua
lly
25,
931
Floa
ting
2016
Bul
let
94,
172
Floa
ting
2019
Bulle
t
1,2
50,8
47
-13,
245
1,2
37,6
02
30,
114
Fixe
d20
19Se
mi a
nnua
lly
1,2
67,7
16
The
Com
pany
has
a p
ortf
olio
of b
ank
loan
s se
cure
d w
ith m
ortg
age
in v
esse
ls. T
he c
redi
tor a
nd g
uara
ntor
s ar
e in
gen
eral
firs
t cla
ss
com
mer
cial
ban
ks a
nd s
tate
ow
ned
finan
cial
inst
itutio
ns w
ith ra
tings
on
or a
bove
BB
B- a
nd A
AA
.A
s of
yea
r end
, the
Com
pany
had
issu
ed tw
o hi
gh y
ield
uns
ecur
ed b
onds
of N
OK
600
mill
ion
and
NO
K 7
00 m
illio
n re
spec
tivel
y.
The
high
yie
ld u
nsec
ured
bon
ds a
re li
sted
on
Osl
o St
ock
Exch
ange
, hav
e no
am
ortiz
atio
n an
d m
atur
es in
201
8 an
d 20
19.
As
of D
ecem
ber 3
1 20
14 a
ll co
vena
nts
requ
irem
ents
hav
e be
en m
et.
The
Com
pany
has
reci
eved
wai
ver o
f fina
ncia
l cov
enan
t for
the
perio
d of
Q1
2015
, fro
m le
nder
s an
d gu
aran
tors
, for
cer
tain
mor
tgag
e ba
cked
ves
sel fi
nanc
ings
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
476
(1) U
nder
the
USD
72.
1 m
illio
n fa
cilit
y, p
art o
f the
loan
(USD
34.
9 m
illio
n) is
fixe
d fo
r a 8
-yea
r ter
m to
ave
rage
inte
rest
rate
of 7
.58%
. (2
) Und
er th
e N
OK
625
.7m
illon
faci
lity,
par
t of t
he lo
an (e
quiv
alen
t to
USD
34.
2 m
illio
n) is
fixe
d fo
r an
appr
oxim
atel
y 10
-yea
r ter
m to
av
erag
e in
tere
st ra
te o
f 5.3
6%.
The
fair
valu
e of
the
curr
ent b
orro
win
gs w
ith fl
oatin
g in
tere
st e
qual
s th
eir c
arry
ing
amou
nt, a
s th
e im
pact
of d
isco
untin
g is
not
si
gnifi
cant
. Th
e fa
ir va
lues
are
bas
ed o
n ca
sh fl
ows
disc
ount
ed u
sing
a ra
te b
ased
on
the
actu
al b
orro
win
g ra
tes,
and
are
with
in le
vel 2
of
the
fair
valu
e hi
erar
chy.
The
fair
valu
e of
the
curr
ent b
orro
win
gs w
ith fi
xed
inte
rest
hav
e be
en c
alcu
late
d by
usi
ng th
e cu
rren
t mar
ket r
ate
for s
imila
r loa
ns, a
nd
are
with
in le
vel 2
of t
he fa
ir va
lue
hier
arch
y.
NO
TES
TO
TH
E A
CC
OU
NTS
2013
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
CO
NSO
LID
ATED
(USD
)Lo
anC
urre
ncy
Com
mit
ted
Faci
lity
amou
nt c
urre
ncy
Dra
wn
amou
nt
curr
ency
Dra
wn
amou
nt
USD
- U
SD 9
0,43
7 9
0,43
7 9
0,43
7
- U
SD (
1) 7
2,12
4 7
2,12
4 7
2,12
4
- N
OK
1,6
09,2
07
- 2
64,5
11
- N
OK
296
,402
-
48,
721
- U
SD 2
1,00
0 2
1,00
0 2
1,00
0
- U
SD 2
3,16
2 1
8,17
3 1
8,17
3
- U
SD 1
16,1
07
57,
432
57,
432
- U
SD 5
8,87
9 4
7,99
0 4
7,99
0
- N
OK
(2)
625
,746
6
25,7
46
102
,856
- N
OK
5,2
50
5,2
50
863
98,
624
NO
K 6
00,0
00
600
,000
9
8,62
4
- N
OK
1,6
57,7
71
889
,050
1
46,1
36
- N
OK
240
,000
-
-
98,
624
Tota
l sec
ured
deb
t 9
68,8
68
- Fe
es a
nd e
xpen
ses
-7,3
68
98,
624
Tota
l 9
61,5
00
41,
718
(CIR
R lo
an) N
OK
253
,800
2
53,8
00
41,
718
140
,342
To
tal l
ong-
term
deb
t inc
ludi
ng fe
es
and
expe
nses
1,0
03,2
18
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
477
Dec
embe
r 31
, 201
3
Fair
val
ueIn
tere
st r
ate
Dur
atio
nIn
stal
men
ts
90,
437
Floa
ting
2017
Qua
rter
ly
77,
797
Fixe
d an
d flo
atin
g20
21Se
mi a
nnua
lly
264
,511
Fl
oatin
g20
15Se
mi a
nnua
lly
48,
721
Floa
ting
2022
Qua
rter
ly
21,
000
Floa
ting
2019
Sem
i ann
ually
16,
925
Fixe
d20
27M
onth
ly
54,
890
Fixe
d20
27M
onth
ly
47,
543
Fixe
d20
30M
onth
ly
104
,340
Fi
xed
and
float
ing
2022
Sem
i ann
ually
928
Fi
xed
2017
Qua
rter
ly
98,
624
Floa
ting
2018
Bulle
t
144
,868
Fi
xed
2018
Sem
i ann
ually
- Fi
xed
or fl
oatin
g20
19Se
mi a
nnua
lly
970
,585
-7,3
68
963
,217
42,
580
Fixe
d20
19Se
mi a
nnua
lly
1,0
05,7
97
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
478
Prio
r to
orde
ring
vess
els
from
Nor
weg
ian
yard
s, th
e C
ompa
ny a
pplie
d fo
r fixe
d 12
-ye
ar in
tere
st ra
te o
ptio
ns re
late
d to
the
long
-ter
m fi
nanc
ing
of s
uch
vess
els.
The
C
ompa
ny w
as g
rant
ed s
uch
optio
ns fo
r ea
ch o
f the
rele
vant
ves
sel b
y th
e N
orw
e-
gian
Exp
ort C
redi
t Age
ncy.
The
Com
pany
m
ade
cert
ain
sale
of t
he ri
ght t
o ex
erci
se
such
opt
ions
to a
firs
t cla
ss in
tern
atio
nal
bank
(the
“Ban
k”).
Lon
g-te
rm lo
ans
draw
n fr
om th
e N
orw
egia
n Ex
port
Cre
dit A
genc
y ar
e pl
aced
as
corr
espo
ndin
g de
posi
ts in
the
Bank
as
finan
cial
sec
urity
for t
he lo
ans
draw
n. R
ecog
nitio
n of
the
gain
, rel
ated
to
each
opt
ion,
is re
cord
ed o
ver t
he te
rm o
f an
y dr
awn
loan
s.
NO
TES
TO
TH
E A
CC
OU
NTS
Une
arne
d C
IRR
2014
2013
Begi
nnin
g of
the
year
2,1
55
2,5
23
Reco
gniz
ed in
the
profi
t and
loss
acc
ount
-368
-3
68
Paid
-bac
k C
IRR
- -
Net
une
arne
d C
IRR
as
of D
ecem
ber
31 1
,786
2
,155
The
book
val
ue o
f mor
tgag
ed a
sset
s co
nsis
t of n
on-c
urre
nt ta
ngib
le a
sset
s an
d po
rtio
n of
the
acco
unts
rece
ivab
les
and
amou
nts
to
USD
1,7
64 m
illio
n at
yea
r end
.Th
ere
are
vario
us fi
nanc
ial c
oven
ants
rela
ted
to th
e C
ompa
ny’s
deb
t agr
eem
ents
. The
mai
n pr
evai
ling
cove
nant
s ar
e:- e
quity
ratio
to to
tal a
sset
s in
exc
ess
of 3
0%- p
ositi
ve w
orki
ng c
apita
l- c
erta
in a
mou
nt o
f fre
ely
avai
labl
e ca
sh a
nd b
ank
depo
sit b
alan
ce- d
ebt s
ervi
ce ra
tios
and
inte
rest
rate
cov
erag
e
The
Com
pany
and
par
ent c
ompa
ny a
re in
com
plia
nce
with
the
finan
cial
cov
enan
ts a
s pe
r Dec
embe
r 31,
201
4.
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
(USD
)In
stal
men
ts p
er D
ecem
ber
31, 2
014
fall
ing
due
over
the
next
5 y
ears
Mor
tgag
e d
ebt
Oth
er in
tere
st
bear
ing
debt
Tota
l
- 20
15 3
08,9
02
- 3
08,9
02
- 20
16 9
9,62
3 -
99,
623
- 20
17 1
18,9
26
- 1
18,9
26
80,
719
2018
282
,909
8
0,71
9 3
63,6
28
94,
172
2019
75,
975
94,
172
170
,147
- Th
erea
fter
166
,380
-
166
,380
174
,891
To
tal
1,0
52,7
14
174
,891
1
,227
,605
CIR
R lo
an (B
oth
cons
olid
ated
and
par
ent c
ompa
ny)
Tota
l CIR
R lo
an c
omm
itmen
t 2
8,45
3 4
1,71
8
CIR
R lo
an d
raw
n on
31.
12 2
8,45
3 4
1,71
8
Com
mit
men
t as
of D
ecem
ber
31 -
-
Cas
h-fl
ow h
edge
s
Siem
Con
sub
SA (s
ubsi
diar
y co
mpa
ny in
Br
azil
with
Bra
zilia
n re
al a
s th
eir f
unc-
tiona
l cur
renc
y) in
itiat
ed h
edge
acc
ount
ing
1 Ja
nuar
y 20
14. T
he h
edgi
ng in
stru
men
t is
100
% o
f the
USD
den
omin
ated
long
-te
rm d
ebt h
eld
by th
e Br
azili
an e
ntity
in
the
amou
nt o
f USD
187
.7 m
illio
n (in
clud
ed
in th
e bo
rrow
ings
tabl
e ab
ove)
and
the
hedg
ed it
em is
the
USD
fore
ign
curr
ency
ex
posu
re re
late
d to
futu
re c
ash
flow
s of
hi
ghly
pro
babl
e co
ntra
cted
cha
rter
ves
sel
reve
nue.
The
hed
ged
item
is th
e va
lue
of
the
first
sal
es o
f the
mon
th fr
om a
por
tfo-
lio o
f sev
en v
esse
ls s
uffic
ient
to c
over
the
mon
thly
deb
t pay
men
t. Th
e pr
ospe
ctiv
e an
d re
tros
pect
ive
effe
c-tiv
enes
s te
stin
g fo
r the
hed
ge fa
lls w
ithin
th
e ac
cept
ed 8
0-12
0% ra
nge,
as
ther
e is
su
ffici
ent h
ead-
room
in th
e ef
fect
iven
ess
test
eve
n th
ough
two
of th
e se
ven
vess
els
wer
e no
t yet
ope
ratio
nal i
n 20
14 (d
ue to
de
laye
d de
liver
y da
tes)
. Th
e ef
fect
ive
por-
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
479
Siem
Indu
strie
s In
c. is
the
pare
nt c
ompa
ny o
f Sie
m E
urop
e S.
a.r.l
. the
Com
pany
’s la
rges
t sha
reho
lder
with
a h
oldi
ng o
f 34.
39%
, and
is
defi
ned
as a
rel
ated
par
ty. T
he C
ompa
ny is
obl
igat
ed to
Sie
m In
dust
ries
Inc.
, for
a fe
e of
USD
250
K (2
013:
USD
300
K).
This
fee
is
the
rem
uner
atio
n fo
r th
e se
rvic
es o
f tw
o of
the
Boa
rd m
embe
rs. T
his
fee
also
cov
ers
offic
e in
the
Cay
man
Isla
nds
and
adm
inis
trat
ive
expe
nces
.D
etai
ls r
elat
ed to
tran
sact
ions
, loa
ns a
nd r
emun
erat
ion
to th
e ex
ecut
ive
Man
agem
ent a
nd th
e bo
ard
of d
irect
ors
are
set o
ut in
Not
e 19
. For
Par
ent,
all s
ubsi
diar
ies
in N
ote
6 ar
e al
so d
efine
d as
rel
ated
par
ties.
For
othe
r re
late
d pa
rtie
s, th
e fo
llow
ing
tran
sact
ions
wer
e ca
rrie
d ou
t:
Abo
ve s
ervi
ce is
pro
vide
d to
com
pani
es in
whi
ch a
Boa
rd m
embe
r ha
s an
inte
rest
. Kris
tian
Siem
is th
e C
hairm
an o
f Sie
m In
dust
ries
Inc.
, whi
ch is
con
trol
led
by a
trus
t who
se p
oten
tial b
enefi
ciar
ies
incl
ude
mem
bers
of K
ristia
n Si
em’s
imm
edia
te fa
mily
. Si
em In
dust
ries
hold
s an
inte
rest
in S
ubse
a 7.
Sie
m O
ffsh
ore
LLC
, 100
% o
wne
d by
the
Com
pany
, has
cha
rter
ed o
ne v
esse
l to
Subs
ea 7
dur
ing
2014
.
Oth
er a
ccru
ed c
ost i
nclu
de a
ccru
ed c
omm
issi
on, p
urch
ase
orde
rs a
nd o
ther
acc
rued
cos
t. O
ther
cur
rent
liab
ilitie
s in
clud
e ac
crue
d sa
larie
s an
d in
cent
ive
prog
ram
, pro
visi
on fo
r ope
ratin
g ex
pens
es a
nd o
ther
sho
rt te
rm li
abili
ties.
No
te 1
3 -
Oth
er
Cu
rre
nt
Lia
bil
itie
s
No
te 1
4 -
Re
late
d P
art
y T
ran
sa
cti
on
s
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
- -
Non
-inte
rest
-bea
ring
shor
t-te
rm li
abili
ties
- -
- -
Soci
al s
ecur
ity e
tc.
3,9
60
5,4
28
60,
000
- Lo
an fr
om s
hare
hold
er60
,000
-
- -
Une
arne
d in
com
e 7
,264
3
,517
926
1
,111
A
ccru
ed in
tere
st 1
3,86
9 1
1,78
0
80
201
O
ther
acc
rued
cos
t, m
ainl
y re
gard
ing
oper
atin
g ex
pens
es v
esse
ls
6,1
03
5,1
33
6,2
49
6,8
58
Oth
er c
urre
nt li
abili
ties
31,
876
18,
203
67,
255
8,1
70
Tota
l oth
er c
urre
nt li
abili
ties
123
,072
4
4,06
1
CO
NSO
LID
ATED
Sale
s of
ser
vice
s20
1420
13
(Am
ount
s in
USD
1,0
00)
Serv
ice
to e
ntity
whe
re d
irect
or h
as o
wne
rshi
p 8
,556
2
,796
Tota
l 8
,556
2
,796
tion
of th
e ca
sh fl
ow h
edge
, USD
14.
6 m
il-lio
n sh
own
in O
CI,
is th
e ef
fect
ive
port
ion
of th
e lo
ss o
n th
e he
dgin
g in
stru
men
t. Th
e he
dge
was
not
100
% e
ffec
tive,
and
a U
SD
6 m
illio
n lo
ss re
late
d to
the
inef
fect
ive-
ness
of t
he c
ash
flow
hed
ge is
reco
gniz
ed
over
the
profi
t or l
oss.
USD
5.6
mill
ion
was
re
cycl
ed fr
om O
CI t
o th
e pr
ofit o
r los
s du
r-in
g 20
14 in
con
nect
ion
with
this
hed
ge.
Net
inve
stm
ent h
edge
wit
h in
tern
al lo
ans
Cur
renc
y tr
ansl
atio
n di
ffer
ence
s of
USD
11
mill
ion
reco
gniz
ed a
s O
CI i
nclu
de
appr
oxim
atel
y U
SD 7
63 th
ousa
nd o
f cu
rren
cy d
iffer
ence
s re
late
d to
loan
s in
U
SD fr
om o
ther
Com
pany
ent
ities
to th
e Br
azili
an e
ntity
. The
se in
tern
al lo
ans
are
desi
gnat
ed a
s a
net i
nves
tmen
t hed
ge in
ac
cord
ance
with
IAS
21 a
nd th
e cu
rren
cy
gain
s an
d lo
sses
reco
gniz
ed in
the
Bra
zilia
n en
tity
are
appr
opria
tely
sho
wn
as p
art o
f OC
I, an
d w
ill b
e re
cycl
ed o
ver
profi
t or l
oss
in th
e ev
ent t
hat t
he B
razi
lian
entit
y ce
ases
to b
e a
cons
olid
ated
C
ompa
ny e
ntity
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
480
Serv
ice
deliv
ered
from
rel
ated
par
ties
is m
ainl
y co
st fo
r te
chni
cal m
anag
emen
t, co
rpor
ate
man
agem
ent a
nd d
eliv
ered
cre
w.
The
serv
ice
is s
uppo
rted
to S
iem
Mel
ing
Off
shor
e D
A, 5
1% o
wne
d by
the
Com
pany
, and
is d
eliv
ered
by
its p
artn
er in
Sie
m M
elin
g O
ffsh
ore
DA
.
The
Com
pany
hol
ds a
long
-ter
m lo
an to
Rov
de In
dust
ripar
k A
S. S
iem
Off
shor
e In
vest
AS
owns
50%
of R
ovde
Indu
strip
ark
AS.
NO
TES
TO
TH
E A
CC
OU
NTS
In Q
3 20
14, t
he v
esse
l “Si
em S
ailo
r” w
as s
old
to a
com
pany
con
trol
led
by O
.H. M
elin
g &
Co
AS
at a
pric
e of
NO
K 2
95 m
illio
n. T
he
purc
hase
r of
the
vess
el is
the
49%
ow
ner
of S
iem
Mel
ing
Off
shor
e D
A, a
nd is
con
trol
led
by O
.H M
elin
g &
Co
AS.
CO
NSO
LID
ATED
Pur
chas
e of
ser
vice
2014
2013
(Am
ount
s in
USD
1,0
00)
Serv
ice
from
rela
ted
part
ies
11,
351
14,
098
Tota
l 1
1,35
1 1
4,09
8
CO
NSO
LID
ATED
Sale
of V
esse
l20
1420
13
(Am
ount
s in
USD
1,0
00)
Sale
of v
esse
l 4
7,44
7 8
4,20
0
Tota
l 4
7,44
7 8
4,20
0
Bal
ance
item
s fo
llow
ing
purc
hase
and
sal
e of
ser
vice
:C
ON
SOLI
DAT
ED
(Am
ount
s in
USD
1,0
00)
2014
2013
Acc
ount
s re
ceiv
able
s 2
,102
4
9
Acc
ount
s pa
yabl
e 2
50
2
Loan
s to
rel
ated
par
ties
:C
ON
SOLI
DAT
ED
(Am
ount
s in
USD
1,0
00)
2014
2013
Loan
to a
ssoc
iate
s
At J
anua
ry 1
308
4
36
Dra
win
gs -
-
Inst
alm
ents
-22
-94
Inte
rest
cha
rged
8
11
Inte
rest
rece
ived
-8
-11
Exch
ange
rate
var
iatio
ns -5
3 -3
4
At D
ecem
ber
31 2
33
308
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
481
Siem
Mel
ing
Off
shor
e D
A h
ad a
long
term
-lia
bilit
y fr
om it
s pa
rtne
r in
Siem
Mel
ing
Off
shor
e D
A.
The
who
le lo
an h
as b
een
repa
id d
urin
g th
e ye
ar.
The
borr
owin
g fa
cilit
y w
as o
n m
arke
t ter
ms
of in
tere
st.
Shor
t-te
rm lo
anA
t the
end
of 2
014
a sh
ort-
term
loan
of U
SD 6
0 m
illio
n w
as d
raw
n by
Sie
m O
ffsh
ore
Inc.
und
er a
cre
dit f
acili
ty p
rovi
ded
by S
iem
Indu
s-tr
ies
Inc.
The
sho
rt-t
erm
loan
is o
n m
arke
t ter
ms
of in
tere
st, a
nd a
n in
tere
st o
f USD
158
K h
as b
een
book
ed a
s co
st fo
r 201
4.
Follo
win
g tr
ansa
ctio
ns w
ith re
late
d pa
rtie
s w
ere
carr
ied
out f
or th
e pa
rent
com
pany
:
Serv
ice
from
sub
sidi
arie
s co
nsis
ts o
f adm
inis
trat
ive
and
corp
orat
e se
rvic
es p
rovi
ded
by S
iem
Off
shor
e M
anag
emen
t AS.
A
ll te
rms
used
for a
bove
tran
sact
ions
are
at a
rms’
leng
th.
Liab
ility
to r
elat
ed p
arti
es:
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
2014
2013
Liab
ility
to r
elat
ed p
arti
es
At J
anua
ry 1
7,0
57
7,5
06
Dra
win
gs -
-
Inst
alm
ents
-6,9
82
-
Inte
rest
exp
ense
s 5
3 3
15
Inte
rest
pai
d -5
3 -1
19
Exch
ange
rate
var
iatio
ns -7
5 -6
45
At D
ecem
ber
31 0
7
,057
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
2014
2013
Serv
ice
from
sub
sidi
arie
s 1
0,08
6 1
0,07
5
Serv
ice
from
ass
ocia
tes
- 1
,650
Tota
l 1
0,08
6 1
1,72
5
Year
-end
bal
ance
s ar
isin
g fr
om s
ales
and
pur
chas
es:
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
2014
2013
Rece
ivab
les
from
rela
ted
part
ies
Subs
idia
ries
18,
598
1,7
14
Ass
ocia
tes
1,9
75
708
Tota
l 2
0,57
3 2
,422
Paya
bles
from
rela
ted
part
ies
Subs
idia
ries
5,7
37
8,9
48
Ass
ocia
tes
- -
Tota
l 5
,737
8
,948
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
482
The
loan
to s
ubsi
diar
ies
is h
eld
agai
nst S
iem
Off
shor
e do
Bra
sil S
A o
n 31
Dec
embe
r 201
4.
Loan
pro
vide
d to
ass
ocia
tes
is h
eld
agai
nst S
iem
Off
shor
e C
ontr
acto
rs G
mbH
, a c
ompa
ny o
wne
d 10
0% b
y th
e su
bsid
iary
Sie
m O
ffsh
ore
Inve
st A
S.
All
loan
s ar
e on
mar
ket t
erm
s of
inte
rest
.
NO
TES
TO
TH
E A
CC
OU
NTS
Loan
s to
rel
ated
par
ties
:PA
REN
T C
OM
PAN
Y
(Am
ount
s in
USD
1,0
00)
201
4 2
013
Loan
to s
ubsi
diar
ies
At J
anua
ry 1
23,
637
67,
177
Dra
win
gs 2
,500
-
Con
vert
ed to
sha
res
-4,4
12
-45,
353
Inst
alm
ents
- -
Inte
rest
cha
rged
555
2
,076
Inte
rest
rece
ived
- -
Exch
ange
rate
var
iatio
ns -5
32
-263
At D
ecem
ber
31 2
1,74
8 2
3,63
7
Loan
to s
ub-s
ubsi
diar
ies
At J
anua
ry 1
18,
104
17,
052
Dra
win
gs 4
,619
-
Con
vert
ed to
sha
res
- -
Inst
alm
ents
-18,
176
-
Inte
rest
cha
rged
299
2
72
Inte
rest
rece
ived
- -
Exch
ange
rate
var
iatio
ns -3
47
780
At D
ecem
ber
31 4
,498
1
8,10
4
Tota
l loa
ns to
rel
ated
par
ties
At J
anua
ry 1
41,
740
84,
229
Dra
win
gs 7
,119
-
Con
vert
ed to
sha
res
-4,4
12
-45,
353
Inst
alm
ents
-18,
176
-
Inte
rest
cha
rged
854
2
,348
Inte
rest
rece
ived
- -
Exch
ange
rate
var
iatio
ns -8
79
517
At D
ecem
ber
31 2
6,24
6 4
1,74
0
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
483
Forw
ard
curr
ency
con
trac
ts:
The
nom
inal
prin
cipa
l am
ount
of t
he
outs
tand
ing
forw
ard
curr
ency
con
trac
ts
on 3
1 D
ecem
ber 2
014
wer
e U
SD 1
22.5
m
illio
n (2
013:
153
.5 m
illio
n) o
f whi
ch U
SD
58.4
mill
ion
refe
rs to
EU
R/U
SD c
ontr
acts
, U
SD 5
4.0
mill
ion
refe
rs to
USD
/NO
K c
on-
trac
ts, U
SD 7
.0 m
illio
n re
fers
to G
BP/U
SD
cont
ract
s, U
SD 2
.2 m
illio
n re
fers
to E
UR/
NO
K c
ontr
acts
and
USD
0.9
mill
ion
refe
rs
to G
BP/
NO
K c
ontr
acts
. Of t
he U
SD 5
4.0
mill
ion
unde
r the
USD
/NO
K c
ontr
acts
, tw
o U
SD 2
0.0
mill
ion
posi
tions
are
off
sett
ing,
su
ch th
at th
e ne
t pos
ition
is U
SD 1
4.0
mill
ion.
The
forw
ard
curr
ency
con
trac
ts
have
bee
n en
tere
d in
to in
ord
er to
hed
ge
prim
arily
ope
ratin
g ex
pens
es in
fore
ign
curr
enci
es a
nd c
omm
ittm
ents
rela
ted
to
vess
els
unde
r con
stru
ctio
n.
No
te 1
5 -
De
riva
tive
Fin
an
cia
l In
str
um
en
ts –
As
se
ts (
Lia
bil
itie
s)
Cur
renc
y op
tion
s:
Cur
renc
y op
tions
hav
e be
en e
nter
ed in
to
in o
rder
to h
edge
ope
ratio
nal c
urre
ncy
expo
sure
.Th
ese
optio
ns a
re ty
pica
lly p
ath-
depe
nd-
ent o
ptio
ns w
hich
incl
ude
feat
ures
rela
ted
to s
ituat
ions
whe
re th
e un
derl
ying
reac
hes
or fl
uctu
ates
with
in s
peci
fic b
arrie
r lev
els.
Th
is e
nabl
es th
e C
ompa
ny to
hed
ge a
ra
nge
in th
e un
derl
ying
cur
renc
y ra
ther
th
an s
impl
y a
leve
l. G
ains
and
loss
es a
re
reco
gnis
ed in
the
profi
t and
loss
.
For f
urth
er in
form
atio
n re
gard
ing
profi
t an
d lo
ss e
ffec
t on
forw
ard
curr
ency
con
-tr
acts
and
cur
renc
y op
tions
, ple
ase
see
Not
e 28
.
Inte
rest
rat
e sw
aps:
The
nom
inal
am
ount
s of
the
outs
tand
-in
g in
tere
st ra
te s
wap
s co
ntra
cts
on 3
1 D
ecem
ber 2
014
wer
e U
SD 2
70.0
mill
ion
(201
3: U
SD 2
88.4
mill
ion)
.
At 3
1 D
ecem
ber 2
014,
the
fixed
rate
s va
ry
from
1.1
3% to
2.2
9%.
The
float
ing
rate
le
g of
the
inte
rest
rate
sw
aps
are
LIBO
R.
Gai
ns a
nd lo
sses
are
reco
gnis
ed in
the
profi
t and
loss
und
er fi
nanc
ial e
xpen
ses.
Cro
ss c
urre
ncy
swap
s:
Cro
ss c
urre
ncy
swap
s ha
ve b
een
ente
red
into
in o
rder
to h
edge
bot
h in
tere
st a
nd
prin
cipa
l pay
men
ts o
n lo
ng te
rm d
ebt
finan
cing
s de
nom
inat
ed in
oth
er c
urre
n-ci
es th
an U
SD.
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
Ass
ets
Liab
iliti
esA
sset
sLi
abili
ties
Forw
ard
curr
ency
con
trac
ts-
2,32
5-
-
- -
Cur
renc
y op
tions
-
10,
292
- 6
,810
- -
Inte
rest
rate
sw
aps
- 4
,683
-
4,2
75
- -
Cro
ss C
urre
ncy
Swap
1,04
1-
- -
- -
Tota
l der
ivat
ive
finan
cial
inst
rum
ents
1,04
116
,732
- 1
1,08
5
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
484
Cap
ital e
xpen
ditu
res
cont
ract
ed fo
r at t
he re
port
ing
date
but
not
yet
pai
d is
as
follo
ws:
(1) C
ontr
actu
al g
uara
ntee
s to
the
Braz
ilian
Nav
y ar
e is
sued
by
Siem
Off
shor
e do
Bra
sil S
A.
(2) C
ontr
actu
al g
uara
ntee
s pr
ovid
ed b
y Pa
rent
are
sec
urity
for o
ne o
f the
con
trac
ting
part
ies
of S
iem
Off
shor
e C
ontr
acto
rs G
mbH
.Su
ch g
uara
ntee
s ar
e fo
r adv
ance
pay
men
ts re
ciev
ed a
t USD
27.
3 m
illio
n an
d pe
rfor
man
ce g
uata
ntee
s at
USD
109
.3 m
illio
n an
d gu
aran
tees
rela
ted
to ta
x ca
ses
in B
razi
l USD
4.7
mill
ion.
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 1
6 -
Gu
ara
nte
es
No
te 1
7 -
Co
mm
itm
en
ts
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
- -
Con
trac
tual
gua
rant
ees
to B
razi
lian
Nav
y (1
) 5
93
4,3
04
106
,131
1
20,2
91
Con
trac
tual
gua
rant
ees
othe
r (2
) 1
41,3
15
150
,014
106
,131
1
20,2
91
Tota
l gua
rant
ees
141
,908
1
54,3
17
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
- -
Ship
build
ing
cont
ract
s w
ith v
aria
tion
orde
rs 6
78,0
76
847
,961
- -
Inst
alm
ents
pai
d 1
27,6
06
146
,992
- -
Unp
aid
inst
alm
ents
550
,470
7
00,9
69
Pare
nt c
ompa
nyIn
stal
men
ts fa
llin
g du
e ov
er th
e ne
xt 3
yea
rsC
ON
SOLI
DAT
ED
12/3
1/20
1412
/31/
2013
(Am
ount
s in
USD
1,0
00)
12/3
1/20
1412
/31/
2013
2014
- 3
94,4
96
- -
2015
242
,062
2
20,1
17
2016
308
,408
8
6,35
6
- -
Tota
l 5
50,4
70
700
,969
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
485
No
te 1
8 -
Op
era
tin
g E
xp
en
se
s
No
te 1
9 -
Sa
lari
es
an
d W
ag
es
, N
um
be
r o
f E
mp
loye
es
(1) P
erso
nnel
exp
ense
s in
clud
es v
esse
l cre
w e
xpen
ses
and
part
of g
ener
al a
nd a
dmin
istr
ativ
e ex
pens
es, s
ee N
ote
18.
Gov
ernm
ent g
rant
s is
a s
peci
al N
orw
egia
n se
aman
pay
roll
and
tax
refu
nd g
iven
to N
orw
egia
n G
over
nmen
t gra
nts
is a
spe
cial
Nor
we-
gian
sea
man
pay
roll
and
tax
refu
nd g
iven
to N
orw
egia
n
The
aver
age
num
ber o
f em
ploy
ees
in th
e C
ompa
ny w
as 1
,073
for 2
014,
incl
udin
g on
shor
e an
d of
fsho
re e
mpl
oyee
s.
No
empl
oyee
s ar
e em
ploy
ed in
the
pare
nt c
ompa
ny.
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
- 1
,675
Ve
ssel
cre
w e
xpen
ses
124
,451
1
13,9
45
769
7
,007
O
ther
ves
sel o
pera
ting
expe
nses
35
,523
45
,568
--
Pow
er C
able
pro
ject
cos
t90
,179
31,0
78
11,
752
10,
091
Gen
eral
and
adm
inis
trat
ion
47,
033
50,
701
12,
521
18,
774
Tota
l ope
rati
ng e
xpen
ses
297
,187
2
41,2
91
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
2014
2013
Pers
onne
l exp
ense
s (1
)
Sala
ries
and
wag
es 9
5,42
1 9
1,36
2
Gov
ernm
ent g
rant
s - n
et w
ages
arr
ange
men
t in
Nor
way
-5,4
57
-5,7
62
Payr
oll t
ax 1
4,30
9 1
3,61
4
Pens
ion
cost
s, s
ee N
ote
8 2
,151
1
,887
Oth
er b
enefi
t 4
,147
2,9
29
Tota
l per
sonn
el e
xpen
ses
110
,571
1
04,0
30
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
486
NO
TES
TO
TH
E A
CC
OU
NTS
Payr
oll r
egis
tere
d to
the
exec
utiv
e m
anag
emen
t: (A
mou
nts
in U
SD 1
,000
)20
1420
13
Sala
ry a
nd o
ther
sho
rt te
rm c
ompe
nsat
ion
2,4
21
2,1
93
Tota
l 2
,421
2
,193
Empl
oyee
s in
clud
ed in
the
abov
e pa
yrol
l in
2014
wer
e fiv
e (2
013:
five
).
Shar
es in
the
Com
pany
hel
d by
mem
bers
of c
orpo
rate
man
agem
ent i
n 20
14 w
ere
2,61
8,16
1 (2
013:
2,6
08,1
61).
The
Boar
d of
Dire
ctor
s of
Sie
m O
ffsh
ore
Inc.
has
aut
horiz
ed th
e aw
ard
of S
tock
Opt
ions
to e
ight
key
em
ploy
ees
of th
e C
ompa
ny.
See
Not
e 31
for m
ore
info
rmat
ion.
Loan
to e
xecu
tive
man
agem
ent:
(Am
ount
s in
USD
1,0
00)
2014
2013
Bala
nce
Janu
ary
1 4
,356
4
,723
Cha
nges
in e
xecu
tive
man
agem
ent
- -
New
loan
rais
ed 4
0 3
5
Inst
alm
ents
-310
-
Effe
ct o
f cur
renc
y di
ffer
ence
s -7
55
-402
Bal
ance
Dec
embe
r 31
3,3
31
4,3
56
Am
ount
s in
USD
1,0
00
Nam
e S
alar
y pa
id
Pen
sion
pre
miu
m
Oth
er b
enefi
ts
Sha
re o
ptio
ns
2014
CEO
Ter
je S
øren
sen
610.
633
.855
.960
0,00
0
CFO
Dag
finn
B. L
ie
310.
531
.112
.540
0,00
0
CO
O S
vein
Erik
Myk
land
45
2.4
40.6
9.0
400,
000
CC
O B
ernt
Om
dal
391.
337
.23.
140
0,00
0
HR
Tor
e B.
Joh
anne
ssen
388.
641
.03.
740
0,00
0
2013
CEO
Ter
je S
øren
sen
559.
330
.254
.53.
000,
000
CFO
Dag
finn
B. L
ie
307.
627
.012
.32.
000,
000
CO
O S
vein
Erik
Myk
land
41
1.1
36.9
8.5
2.00
0,00
0
CC
O B
ernt
Om
dal
367.
833
.13.
52.
000,
000
HR
Tor
e B.
Joh
anne
ssen
298.
03.
53.
52.
000,
000
Cor
pora
te m
anag
emen
t sal
arie
s an
d ot
her b
enefi
ts a
re p
rese
nted
in th
e ta
ble
belo
w:
Loan
on
Dec
embe
r 31
, 201
4: (A
mou
nts
in U
SD 1
,000
)A
mou
ntIn
tere
stTe
rms
Loan
to e
xecu
tive
man
agem
ent
3,3
31
- Sh
are
loan
(1).
Tota
l 3
,331
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
487
The
Com
pany
has
ent
ered
into
diff
eren
t ope
ratin
g le
ases
for o
ffice
pre
mis
es, o
ffice
mac
hine
s, a
nd c
omm
unic
atio
n sa
telli
te e
quip
men
t fo
r the
ves
sels
. The
leas
es a
lso
incl
ude
a su
bstit
ute
vess
el o
n a
time
char
ter p
arty
. Th
e le
ase
perio
d fo
r the
leas
e ag
reem
ents
var
ies
and
mos
t of t
he le
ases
con
tain
an
optio
n fo
r ext
ensi
on.
The
oper
atin
g le
ases
in th
e Pa
rent
for
201
3 ar
e re
late
d to
cha
rter
of v
esse
ls a
nd s
atel
lite
equi
pmen
t. O
ne o
f the
cha
rter
ed v
esse
ls,
“Sie
m S
asha
” has
bee
n ch
arte
red
on b
areb
oat a
gree
men
ts fr
om th
e su
bsid
iary
Sie
m O
ffsh
ore
Rede
ri A
S. T
he c
ontr
act w
as fi
nish
ed
Sept
embe
r 201
3. T
he le
ase
cost
s w
ere
as fo
llow
s:
No
te 2
0 -
Op
era
tin
g L
ea
se
s a
s L
es
se
e
Aud
itor
’s r
emun
erat
ion
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
99
103
A
udit
Fee
528
579
60
51
Aud
it Fe
e O
ther
202
139
21
- Ta
x/Le
gal A
ssis
tanc
e11
612
7
- -
Oth
er c
onsu
ltant
s, F
ees
5628
180
155
To
tal a
udit
or’s
rem
uner
atio
n90
287
3
PAR
ENT
CO
MPA
NY
Fall
due
CO
NSO
LID
ATED
- 20
15 1
,787
- 20
16 1
,193
- 20
17 a
nd th
erea
fter
1,8
59
- To
tal
4,8
39
As
of 3
1 D
ecem
ber 2
014,
the
Com
pany
had
som
e co
mm
itmen
ts re
latin
g to
leas
e ag
reem
ents
whi
ch fa
ll du
e as
follo
ws.
Net
pre
sent
val
ue o
f fut
ure
com
mitm
ents
rela
ting
to le
ase
agre
emen
ts a
re c
alcu
late
d to
be
USD
4,8
39 f
or th
e C
ompa
ny.
Ther
e ar
e no
leas
e ag
reem
ent f
or th
e Pa
rent
. The
inte
rest
rat
e in
the
calc
ulat
ion
of n
et p
rese
nt v
alue
is 5
%.
Loa
n on
Dec
embe
r 31
, 201
3 (A
mou
nts
in U
SD 1
,000
)A
mou
ntIn
tere
stTe
rms
Loan
to e
xecu
tive
man
agem
ent
4,3
56
- Sh
are
loan
(1).
Tota
l 4
,356
(1) S
hare
loan
: Th
e lo
ans
are
repa
yabl
e by
the
empl
oyee
whe
n th
e em
ploy
ee’s
sha
res
in th
e co
mpa
ny a
re re
aliz
ed o
r if t
he e
mpl
oyee
le
aves
the
Com
pany
. Lo
ans
equi
vale
nt to
USD
4 m
illio
n ar
e se
cure
d by
ple
dges
in re
leva
nt s
hare
s.Th
e Re
mun
erat
ion
paid
to th
e Bo
ard
of D
irect
ors
in 2
014
was
USD
440
K (2
013:
USD
437
K).
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
05,
883
Ann
ual l
ease
pay
men
t on
oper
atio
nal l
ease
s 4
,020
8
,763
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
488
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 2
1 -
Fin
an
cia
l It
em
s
No
te 2
2 -
Ea
rnin
gs
pe
r S
ha
re
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
Fina
ncia
l inc
ome
4,1
62
9,5
47
Inte
rest
inco
me
4,1
88
5,3
60
- -
Gai
n in
terc
ompa
ny c
losu
re -
-
- 3
9 O
ther
fina
ncia
l inc
ome
4,9
03
74
4,1
62
9,5
86
Tota
l fina
ncia
l inc
ome
9,0
91
5,4
34
Fina
ncia
l exp
ense
s
-11,
801
-6,9
76
Inte
rest
exp
ense
s
-48,
451
-36,
607
- -
Inte
rest
rate
SW
AP
-5,0
63
3,7
84
-903
-8
28
Oth
er fi
nanc
ial e
xpen
ses
-2,3
54
-3,3
09
-12,
704
-7,8
04
Tota
l fina
ncia
l exp
ense
s -5
5,86
8 -3
6,13
2
Oth
er fi
nanc
ial i
tem
s
--
Loss
on
FX c
ontr
acts
-3,0
22-7
,756
4,8
42
1,2
19
Net
cur
renc
y ga
in/(
loss
) 3
7,11
4 -1
4,89
5
(Am
ount
s in
USD
1,0
00)
Earn
ings
per
sha
re20
1420
13
Wei
ghte
d av
erag
e nu
mbe
r of s
hare
s ou
tsta
ndin
g 3
87,5
91
389
,078
Wei
ghte
d av
erag
e nu
mbe
r of s
hare
s di
lute
d 3
89,1
44
389
,144
Resu
lt at
trib
utab
le to
sha
reho
lder
s 5
8,14
7 2
2,00
0
Earn
ings
per
sha
re a
ttri
buta
ble
to e
quit
y sh
areh
olde
rs 0
.15
0.0
6
Earn
ings
per
sha
re d
ilute
d at
trib
utab
le to
equ
ity
shar
ehol
ders
0.1
5 0
.06
Opt
ion
prog
ram
to e
xecu
tive
man
agem
ent,
see
note
19
and
31.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
489
Con
trac
ts in
pro
gres
s re
fer t
o ac
tivity
with
in th
e C
omba
t Man
agem
ent S
yste
ms
(CM
S) a
nd C
able
Inst
alla
tion
Segm
ent,
see
Not
e 4.
At y
ear-
end
2014
, the
act
ivity
with
in C
MS
had
five
pro
ject
s in
pro
gres
s. T
he d
egre
e of
com
plet
ion
varie
s fr
om 0
.1%
to 1
00%
. Mar
gin
is
calc
ulat
ed a
nd in
clud
ed fo
r all
five
proj
ects
. Th
e ac
tivity
with
in th
e C
able
Inst
alla
tion
Segm
ent i
nclu
ded
six
proj
ects
in p
rogr
ess
at y
ear-
end
2014
. The
se p
roje
cts
are
in a
n va
rious
ph
ases
, and
mar
gin
for 2
014
is re
cogn
ized
onl
y on
pro
ject
s w
ith p
rogr
ess
exce
edin
g 45
%.
All
proj
ects
in p
rogr
ess
at y
ear-
end
2014
are
est
imat
ed to
gen
erat
e a
posi
tive
cont
ribut
ion
over
the
tota
l pro
ject
per
iod.
Ther
e ar
e no
con
trac
ts in
pro
gres
s in
the
Pare
nt.
See
note
2.9
for a
naly
sis
of s
ensi
tivity
.
No
te 2
3 -
Co
ntr
ac
ts i
n P
rog
res
s
CO
NSO
LID
ATED
Rec
ogni
zed
Acc
umul
ated
per
(Am
ount
s in
USD
1,0
00)
2014
12/3
1/20
14
Reve
nue
105
,789
1
48,7
55
Cos
t 9
4,26
1 1
32,6
12
Tota
l 1
1,52
8 1
6,14
3
Ass
ets
/ lia
bilit
ies
Dec
embe
r 31
, 201
4
Une
arne
d re
v-en
ueA
ccru
ed p
roje
ct c
ost
Unb
illed
rev
enue
Reve
nue
21,
549
- 1
4,91
8
Cos
t 2
2,52
1 -
Tota
l 2
1,54
9 2
2,52
1 1
4,91
8
Rec
ogni
zed
Acc
umul
ated
per
(Am
ount
s in
USD
1,0
00)
2013
12/
31/2
013
Reve
nue
33,
923
43,
417
Cos
t 3
2,56
4 3
9,45
2
Tota
l 1
,360
3
,966
Ass
ets
/ lia
bilit
ies
Dec
embe
r 31
, 201
3
Une
arne
d re
venu
eA
ccru
ed p
roje
ct c
ost
Unb
illed
rev
enue
Reve
nue
8,6
08
- 2
,473
Cos
t 2
93
-
Tota
l 8,
608
293
2
,473
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
490
Book
ed v
alue
for
the
vess
el “S
iddi
s Sk
ippe
r” w
as tr
ansf
erre
d fr
om fi
xed
asse
ts to
ass
et h
eld
for s
ale
in D
ecem
ber 2
013.
The
ves
sel w
as
sold
on
Janu
ary
8, 2
014.
Ther
e is
no
asse
t hel
d fo
r sal
e in
the
pare
nt c
ompa
ny o
r gro
up a
s of
Dec
embe
r 31,
201
4.
2014
:Th
e ne
t gai
n fo
r the
Com
pany
on
sale
of a
sset
s of
18.
7mill
ion
cons
ist o
f gai
n fr
om s
ale
of th
e PS
V “S
iddi
s Sk
ippe
r”, “
Siem
Sai
lor”
by
USD
17.
9 m
illio
n an
d ot
her U
SD 0
.7 m
illio
n.
2013
:Th
e ne
t gai
n fo
r the
Com
pany
on
sale
of a
sset
s co
nsis
ted
of g
ain
from
sal
e of
the
MRS
V “S
even
Sis
ters
“ of U
SD 2
8.2
mill
ion
and
gain
of
sale
of o
ne s
mal
ler v
esse
l in
Braz
il of
USD
1.6
mill
ion.
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 2
5 -
Oth
er
Ga
in/(
Lo
ss
) o
n S
ale
of
As
se
ts
No
te 2
4 -
As
se
t H
eld
fo
r S
ale
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
20
1420
13
Purc
hase
cos
t per
Jan
uary
1 1
8,12
1 -
Mov
ed fr
om F
ixed
ass
et -
18,
121
Cap
ital e
xpen
ditu
re
- -
The
year
’s d
ispo
sal a
t cos
t -
18,1
21 -
Effe
ct o
f exc
hang
e ra
te d
iffer
ence
s -
-
Pur
chas
e co
st p
er D
ecem
ber
31 -
18,
121
PAR
ENT
CO
MPA
NY
C
ON
SOLI
DAT
ED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
- -
Gai
n/(lo
ss) o
n sa
le o
f ass
ets,
net
18,
728
29,
827
- -
Gai
n/(lo
ss) o
n sa
le o
f ass
ets
inte
rcom
pany
- -
- -
Tota
l 1
8,72
8 2
9,82
7
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
491
Siem
Indu
strie
s In
c. s
old
it’s
hold
ings
in th
e C
ompa
ny to
Sie
m E
urop
e S.
a.r.l
. on
30 D
ecem
ber 2
014,
a w
holly
ow
ned
subs
idia
ry.
Siem
Eur
ope
S.a.
r.l. i
s th
e m
ain
shar
ehol
der o
f Sie
m O
ffsh
ore
Inc.
and
is c
ontr
olle
d by
a tr
ust w
hose
pot
entia
l be
nefic
iarie
s in
clud
e m
embe
rs o
f Kris
tian
Siem
’s im
med
iate
fam
ily. K
ristia
n Si
em, w
ho is
a D
irect
or o
f the
Com
pany
, is
als
o th
e C
hairm
an o
f Sie
m In
dust
ries
Inc.
Terje
Sør
ense
n is
the
CEO
of t
he C
ompa
ny a
nd h
eld
1,95
0,00
0 sh
ares
on
Dec
embe
r 31,
201
4.
No
te 2
6 -
Lis
tin
g o
f th
e 2
0 L
arg
es
t S
ha
reh
old
ers
as
of
De
ce
mb
er
31
, 2
01
4
SHA
REH
OLD
ERN
UM
BER
OF
SHA
RES
OW
NER
INTE
RES
T
SIEM
EU
ROPE
S.a
.r.l.
133,
279,
421
34,3
9%
AC
E C
ROW
N IN
TERN
ATIO
NA
L LI
MIT
ED
76,7
80,8
0819
,81%
FON
DSF
INA
NS
SPA
R 12
,350
,000
3,19
%
SKA
GEN
KO
N-T
IKI
10,9
77,6
292,
83%
MP
PEN
SJO
N P
K
9,84
1,31
32,
54%
WAT
ERM
AN
HO
LDIN
G L
TD
8,51
0,76
72,
20%
SKA
GEN
VEK
ST
8,03
6,31
72,
07%
DA
NSK
E IN
VEST
NO
RSK
E IN
STIT
. II.
5,51
2,17
11,
42%
OJA
DA
AS
5,31
3,00
01,
37%
VARM
A M
UTU
AL
PEN
SIO
N IN
SURA
NC
E 4,
973,
285
1,28
%
JP M
ORG
AN
CLE
ARI
NG
CO
RP.
3,73
3,08
50,
96%
MER
RILL
LYN
CH
,PIE
RCE,
FEN
NER
&S.
INC
3,
717,
644
0,96
%
FON
DSA
VAN
SE A
S 3,
366,
602
0,87
%
NO
RDEA
BA
NK
FIN
LAN
D P
LC, M
ARK
ETS
3,32
4,60
00,
86%
DA
NSK
E IN
VEST
NO
RSK
E A
KSJE
R IN
ST
3,25
7,30
00,
84%
ALT
A IN
VEST
SA
3,
123,
151
0,81
%
PUM
PØS
AS
3,01
7,57
40,
78%
VERD
IPA
PIRF
ON
DET
DN
B SM
B
2,97
0,00
00,
77%
FON
DSF
INA
NS
AS
2,93
9,93
20,
76%
BERG
EN K
OM
MU
NA
LE P
ENSJ
ON
SKA
SSE
2,85
0,00
00,
74%
Tota
l 20
larg
est s
hare
hold
ers
307
,874
,599
79
,43%
Oth
er s
hare
hold
ers
79,
716,
781
20,5
7%
Tota
l num
ber
of o
utst
andi
ng s
hare
s 3
87,5
91,3
80
100,
00%
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
492
Expi
ring
cha
rter
con
trac
ts w
ith
Petr
o-br
as in
Bra
zil
Petr
obra
s in
form
ed in
Jan
uary
201
5 th
at th
e cu
rren
t con
trac
ts fo
r fou
r AH
TS
vess
els
empl
oyed
in B
razi
l will
not
be
exte
nded
follo
win
g co
ntra
ct e
xpiry
dur
ing
Febr
uary
201
5. P
etro
bras
took
sim
ilar
actio
ns a
gain
st a
ll ow
ners
who
se v
esse
l co
ntra
cts
wer
e ex
pirin
g. A
ltern
ativ
e em
ploy
men
t sha
ll be
pur
sued
glo
bally
for
thes
e fo
ur v
esse
ls.
Sign
ed U
SD 3
50 m
illio
n lo
an a
nd g
uar-
ante
e fa
cilit
y ag
reem
ent
A U
SD 3
50 m
illio
n lo
an a
nd g
uara
ntee
fa
cilit
y ha
s be
en s
igne
d fo
r tw
o ne
w
wel
l-in
terv
entio
n ve
ssel
s (“
WIV
s”) u
nder
co
nstr
uctio
n in
Ger
man
y. T
he W
IVs
are
sche
dule
d fo
r del
iver
y du
ring
first
hal
f of
201
6, a
nd b
oth
WIV
s sh
all c
omm
ence
7-
year
cha
rter
s up
on d
eliv
ery
from
the
yard
.
Furt
her d
etai
ls re
late
d to
the
curr
ency
der
ivat
ive
cont
ract
s ar
e se
t out
in N
ote
15.
NO
TES
TO
TH
E A
CC
OU
NTS
No
te 2
7 –
Su
bs
eq
ue
nt
Eve
nts
No
te 2
8 -
G
ain
/(L
os
s)
on
Cu
rre
nc
y D
eri
va
tive
Co
ntr
ac
ts
Cha
rter
con
trac
t for
“Si
em G
iant
” in
B
razi
l
A o
ne y
ear c
ontr
act w
ith P
etro
bras
has
be
en a
gree
d fo
r the
PSV
“Sie
m G
iant
”. Th
e co
ntra
ct w
ill c
omm
ence
no
late
r tha
n Se
ptem
ber 2
015.
Sale
of t
wo
Off
shor
e Su
bsea
Con
stru
c-ti
on V
esse
ls
Day
a M
ater
ials
Bhd
. (“D
aya”
) has
bee
n gi
ven
until
mid
-Apr
il to
arr
ange
for fi
nanc
-in
g an
d to
pay
the
full
10%
dep
osit
on th
e tw
o 20
13-b
uilt
OSC
Vs “S
iem
Day
a 1”
and
“S
iem
Day
a 2”
, whi
ch a
re n
egot
iate
d to
be
sold
to D
aya.
The
sub
sequ
ent d
eliv
ery
of
the
vess
els
shal
l the
reaf
ter t
ake
plac
e la
t-es
t by
mid
Jul
y. T
he re
cent
vol
atili
ty in
the
mar
ket f
or o
ffsh
ore
vess
els
has
incr
ease
d th
e un
cert
aint
y of
this
tran
sact
ion
to b
e co
nclu
ded.
Bot
h ve
ssel
s ar
e on
long
-ter
m
char
ters
to D
aya.
Deb
t fina
ncin
g fo
r th
ree
PSV
s un
der
cons
truc
tion
in P
olan
d
Deb
t fina
ncin
g ob
tain
ed fo
r the
thre
e du
al-
fuel
led
PSVs
und
er c
onst
ruct
ion
in P
olan
d.
Wai
ver
of fi
nanc
ial c
oven
ant
Reci
eved
wai
ver o
f fina
ncia
l cov
enan
t fo
r the
per
iod
1Q 2
015,
from
lend
ers
and
guar
anto
rs, f
or c
erta
in m
ortg
age
back
ed
vess
el fi
nanc
ings
.N
ords
ee o
ne o
ffsh
ore
win
d fa
rm
reac
hed
finan
cial
clo
se
The
finan
cial
clo
se fo
r the
Nor
dsee
one
of
fsho
re w
ind
farm
was
reac
hed.
The
pr
ojec
t inc
lude
s co
ntra
ctin
g w
ork
for t
he
who
lly o
wne
d su
bsid
iary
of S
iem
Off
shor
e In
c, S
iem
Off
shor
e C
ontr
acto
rs G
mbH
re
late
d to
turn
key
supp
ly a
nd in
stal
latio
n pa
ckag
e of
the
inne
r grid
cab
le s
yste
m.
Aw
ard
of c
ontr
act f
or th
e Ve
ja M
ate
offs
hore
win
d fa
rm
Siem
Off
shor
e C
ontr
acto
rs G
mbH
aw
ard-
ed th
e co
ntra
ct fo
r the
turn
key
supp
ly a
nd
inst
alla
tion
pack
age
of th
e in
ner a
rray
gr
id c
able
sys
tem
for t
he 4
00 M
W V
eja
Mat
e O
ffsh
ore
Win
d Fa
rm. T
he c
ontr
act,
estim
ated
at a
val
ue in
exc
ess
of E
uro
100
Mill
ion,
hig
hlig
hts
the
cont
inue
d gr
owth
in
the
Off
shor
e Re
new
able
Ene
rgy
Mar
ket
for t
he S
iem
Off
shor
e gr
oup.
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
- -
Unr
ealiz
ed g
ain/
(loss
) -5
,612
-1
2,20
0
- -
Real
ized
gai
n/(lo
ss)
2,5
90
4,4
44
- -
Tota
l -3
,023
-7
,756
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
493
Belo
w is
a c
ompa
rison
by
cate
gory
for c
arry
ing
amou
nts
and
fair
valu
es o
f all
of th
e C
ompa
ny’s
fina
ncia
l ins
trum
ents
.
(1) P
repa
ymen
ts d
o no
t qua
lify
as a
fina
ncia
l ins
trum
ent a
nd a
re n
ot in
clud
ed in
abo
ve a
mou
nt.
Excl
uded
pre
paym
ents
am
ount
to U
SD 3
2,90
5, s
ee N
ote
9.
(1) N
on-fi
nanc
ial l
iabi
litie
s do
not
qua
lify
as a
fina
ncia
l ins
trum
ent a
nd a
re n
ot in
clud
ed in
abo
ve a
mou
nt. E
xclu
ded
liabi
litie
s am
ount
to
USD
22,
161
cons
istin
g of
USD
10,
438
in T
axes
Pay
able
, USD
2,7
78 in
Pen
sion
Lia
bilit
y, U
SD 5
,428
in S
ocia
l Sec
urity
Pay
able
and
U
SD 3
,517
in U
near
ned
Inco
me.
See
Not
e 13
for i
nfor
mat
ion
abou
t Soc
ial S
ecur
ity P
ayab
le a
nd U
near
ned
Inco
me.
(1) P
repa
ymen
ts d
o no
t qua
lify
as a
fina
ncia
l ins
trum
ent a
nd a
re n
ot in
clud
ed in
abo
ve a
mou
nt. E
xclu
ded
prep
aym
ents
am
ount
to
USD
13,
517,
see
Not
e 9.
No
te 2
9 -
Fin
an
cia
l In
str
um
en
t b
y C
ate
go
ry
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
4
Lo
ans
and
rece
ivab
les
Ass
ets
at fa
ir v
alue
thro
ugh
the
profi
t and
loss
Ava
ilabl
e fo
r sa
leTo
tal
Ass
ets
as p
er s
tate
men
t of fi
nanc
ial p
osit
ion
Fina
ncia
l ass
ets
held
for s
ale
- -
- -
Der
ivat
ive
finan
cial
inst
rum
ents
1,0
41
1,0
41
- 1
,041
Trad
e an
d ot
her r
ecei
vabl
es (1
) 3
3,14
6 -
- 3
3,14
6
Cas
h an
d ca
sh e
quiv
alen
ts 1
17,6
23
- -
117
,623
Tota
l15
1,81
0 1
,041
-
151
,810
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
4Li
abili
ties
at f
air
valu
e th
roug
h th
e pr
ofit a
nd lo
ssO
ther
fina
ncia
l lia
bilit
ies
Tota
l
Liab
iliti
es a
s pe
r st
atem
ent o
f fina
ncia
l pos
itio
n
Bank
deb
ts, b
onds
, loa
ns a
nd o
ther
pay
able
s (1
) -
172
,662
1
72,6
62
Der
ivat
ive
finan
cial
inst
rum
ents
16,
732
- 1
6,73
2
Tota
l 1
6,73
2 1
72,6
62
189,
394
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
3Lo
ans
and
rece
ivab
les
Ass
ets
at fa
ir v
alue
thro
ugh
the
profi
t and
loss
Ava
ilabl
e fo
r sa
leTo
tal
Ass
ets
as p
er s
tate
men
t of fi
nanc
ial p
ositi
on
Fina
ncia
l ass
ets
held
for s
ale
- -
- -
Der
ivat
ive
finan
cial
inst
rum
ents
- -
- -
Trad
e an
d ot
her r
ecei
vabl
es (1
) 1
20,7
75 -
- 1
20,7
75
Cas
h an
d ca
sh e
quiv
alen
ts 1
01,2
06 -
- 1
01,2
06
Tota
l 2
21,9
81 -
- 2
21,9
81
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
494
(1) P
repa
ymen
ts d
o no
t qua
lify
as a
fina
ncia
l ins
trum
ent a
nd a
re n
ot in
clud
ed in
abo
ve a
mou
nt. E
xclu
ded
prep
aym
ents
am
ount
to U
SD
3,48
0, s
ee N
ote
9.
(1) N
on-fi
nanc
ial l
iabi
litie
s do
not
qua
lify
as a
fina
ncia
l ins
trum
ent a
nd a
re n
ot in
clud
ed in
abo
ve a
mou
nt. E
xclu
ded
liabi
litie
s am
ount
to
USD
22,
161
cons
istin
g of
USD
10,
438
in T
axes
Pay
able
, USD
2,7
78 in
Pen
sion
Lia
bilit
y, U
SD 5
,428
in S
ocia
l Sec
urity
Pay
able
and
USD
3,
517
in U
near
ned
Inco
me.
See
Not
e 13
for i
nfor
mat
ion
abou
t Soc
ial S
ecur
ity P
ayab
le a
nd U
near
ned
Inco
me.
NO
TES
TO
TH
E A
CC
OU
NTS
CO
NSO
LID
ATED
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
3Li
abili
ties
at f
air
valu
e th
roug
h th
e pr
ofit a
nd lo
ssO
ther
fina
ncia
l lia
bilit
ies
Tota
l
Liab
iliti
es a
s pe
r st
atem
ent o
f fina
ncia
l pos
itio
n
Bank
deb
ts, b
onds
, loa
ns a
nd o
ther
pay
able
s (1
) -
1,0
76,9
30
1,0
76,9
30
Der
ivat
ive
finan
cial
inst
rum
ents
11,
085
- 1
1,08
5
Tota
l 1
1,08
5 1
,076
,930
1
,088
,015
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
4Lo
ans
and
rece
ivab
les
Ass
ets
at fa
ir v
alue
thro
ugh
the
profi
t and
loss
Ava
ilabl
e fo
r sa
leTo
tal
Ass
ets
as p
er s
tate
men
t of fi
nanc
ial p
osit
ion
Der
ivat
ive
finan
cial
inst
rum
ents
- -
-
Trad
e an
d ot
her i
nstr
umen
ts (1
)76
,636
76,6
36
Cas
h an
d ca
sh e
quiv
alen
ts22
2, 5
7922
2,57
9
Tota
l29
9,21
5-
-29
9,21
5
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
4
Li
abili
ties
at f
air
valu
e th
roug
h th
e pr
ofit a
nd lo
ssO
ther
fina
ncia
l lia
bilit
ies
Tota
l
Liab
iliti
es a
s pe
r st
atem
ent o
f fina
ncia
l pos
itio
n
Bank
deb
ts, b
onds
, loa
ns a
nd o
ther
pay
able
s -
203
,387
2
03,3
87
Der
ivat
ive
finan
cial
inst
rum
ents
- -
-
Tota
l -
203
,387
2
03,3
87
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
495
Reco
ncili
atio
n of
net
pro
fit fo
r the
fina
ncia
l yea
r to
profi
t/(lo
ss) b
efor
e ta
xes,
exc
ludi
ng in
tere
st.
No
te 3
0 –
Pro
fit
Be
fore
Ta
xe
s,
Ex
clu
din
g I
nte
res
ts
(1) P
repa
ymen
ts d
o no
t qua
lify
as a
fina
ncia
l ins
trum
ent a
nd a
re n
ot in
clud
ed in
abo
ve a
mou
nt. E
xclu
ded
prep
aym
ents
am
ount
to
USD
1,8
72, s
ee N
ote
9.
PAR
ENT
CO
MPA
NY
CO
NSO
LID
ATED
2014
2013
(Am
ount
s in
USD
1,0
00)
2014
2013
-64,
448
-4,8
45
Net
pro
fit/(
loss
) 7
0,71
0 2
1,54
4
11,
801
6,9
76
Inte
rest
exp
ense
s 4
8,45
1 3
6,60
7
-921
-2
,640
In
terc
ompa
ny in
tere
st -
-
-3,2
41
-3,1
19
Inte
rest
inco
me
-4,1
88
-5,3
60
- 2
61
Tax
expe
nse
2,7
29
-3,5
85
-56,
809
-3,3
67
Pro
fit b
efor
e ta
xes,
exc
ludi
ng in
tere
st 1
17,7
02
49,
205
PAR
ENT
CO
MPA
NY
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
3Lo
ans
and
rece
ivab
les
Ass
ets
at fa
ir v
alue
thro
ugh
the
profi
t and
loss
Ava
ilabl
e fo
r sa
leTo
tal
Ass
ets
as p
er s
tate
men
t of fi
nanc
ial p
ositi
on
Der
ivat
ive
finan
cial
inst
rum
ents
- -
-
Trad
e an
d ot
her r
ecei
vabl
es (1
)97
,464
- -
97,
464
Cas
h an
d ca
sh e
quiv
alen
ts13
2,06
8 -
- 1
32,0
68
Tota
l22
9,53
1 -
- 2
29,5
31
Pare
nt c
ompa
ny
(Am
ount
s in
USD
1,0
00)
Dec
embe
r 31
, 201
3Li
abili
ties
at f
air
valu
e th
roug
h th
e pr
ofit a
nd lo
ssO
ther
fina
ncia
l lia
bilit
ies
Tota
l
Liab
iliti
es a
s pe
r st
atem
ent o
f fina
ncia
l pos
itio
n
Bank
deb
ts, b
onds
, loa
ns a
nd o
ther
pay
able
s -
140
,739
1
40,7
39
Der
ivat
ive
finan
cial
inst
rum
ents
- -
-
Tota
l -
140
,739
1
40,7
39
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
496
No
te 3
1 –
Sh
are
-ba
se
d p
ay
me
nts
2014
Sha
re o
ptio
n pr
ogra
m:
On
the
02. A
pril
2014
, the
Com
pany
en
tere
d in
to a
Sha
re o
ptio
n ag
reem
ent
with
sel
ecte
d em
ploy
ees.
The
Boa
rd o
f D
irect
ors
of S
iem
Off
shor
e In
c. h
as
auth
oriz
ed th
e aw
ard
of 3
,000
,000
sha
re
optio
ns to
ten
key
empl
oyee
s of
the
Com
pany
. The
exe
rcis
e pr
ice
is N
OK
9.0
7 pe
r sha
re. T
he e
xerc
ise
pric
e of
the
gran
ted
optio
ns is
equ
al to
the
mar
ket
pric
e of
the
shar
es o
n th
e da
te o
f the
gr
ant.
The
Opt
ions
can
be
exer
cise
d as
follo
ws:
2017
: 60
% o
f the
tota
l num
ber b
egin
ning
on
Apr
il 2n
d 20
17, l
ess
any
optio
ns p
revi
ousl
y is
sued
.
2018
: 80
% o
f the
tota
l num
ber b
egin
ning
on
Apr
il 2n
d 20
18, l
ess
any
optio
ns
prev
ious
ly is
sued
. 20
19:
100%
of t
he to
tal n
umbe
r beg
inni
ng o
n A
pril
2nd
2019
, les
s an
y op
tions
pre
vi-
ousl
y is
sued
.
The
exer
cise
per
iod
shal
l in
no e
vent
be
late
r tha
n th
e da
te fa
lling
10
year
s af
ter
the
awar
d da
te.
The
grou
p ha
s no
lega
l or c
onst
ruct
ive
oblig
atio
n to
repu
rcha
se o
r set
tle
the
op-
tions
in c
ash.
The
wei
ghte
d av
erag
e fa
ir va
lue
of o
ptio
ns
gran
ted
durin
g th
e pe
riod
dete
rmin
ed
usin
g th
e Bl
ack-
Scho
les
valu
atio
n m
odel
w
as N
OK
3.6
5 pe
r opt
ion.
The
sign
ifica
nt in
puts
into
the
mod
el w
ere
wei
ghte
d av
erag
e sh
are
pric
e of
NO
K 9
.07
at th
e gr
ant d
ate,
exe
rcis
e pr
ice
of N
OK
9.
07, v
olat
ility
of 2
3%, d
ivid
end
yiel
d of
0%
, an
expe
cted
opt
ion
life
of 1
0 ye
ars
and
an a
nnua
l ris
k-fr
ee in
tere
st ra
te o
f 2.9
0%.
The
vola
tility
mea
sure
d at
the
stan
dard
de
viat
ion
of c
ontin
uous
ly c
ompo
unde
d sh
are
retu
rns
is b
ased
on
stat
istic
al
anal
ysis
of d
aily
sha
re p
rices
ove
r the
last
th
ree
year
s.
Tota
l exp
ense
reco
gnis
ed in
the
inco
me
stat
emen
t for
sha
re o
ptio
ns g
rant
ed to
ce
rtai
n em
ploy
ees
is U
SD 0
.1 m
illio
n.
Valu
e of
em
ploy
ee s
ervi
ces
as p
er
Dec
embe
r 31,
201
4 ar
e re
cogn
ized
und
er
Reta
ined
ear
ning
s at
USD
0,3
91 a
nd y
ield
of
0%
, an
expe
cted
opt
ion
life
of 1
0 ye
ars
and
an a
nnua
l ris
k-fr
ee in
tere
st ra
te o
f 2.
90%
firs
t thr
ee y
ears
NO
TES
TO
TH
E A
CC
OU
NTS
201
3 Sh
are
opti
on p
rogr
am:
On
the
13 ja
nuar
y 20
13, t
he C
ompa
ny e
n-te
red
into
a S
hare
opt
ion
agre
emen
t with
se
lect
ed e
mpl
oyee
s. T
he B
oard
of D
irec-
tors
of S
iem
Off
shor
e In
c. h
as a
utho
rized
th
e aw
ard
of 1
4,00
0,00
0 sh
are
optio
ns to
ei
ght k
ey e
mpl
oyee
s of
the
Com
pany
. The
ex
erci
se p
rice
is N
OK
8.45
per
sha
re.
The
exer
cise
pric
e of
the
gran
ted
optio
ns
is e
qual
to th
e m
arke
t pric
e of
the
shar
es
on th
e da
te o
f the
gra
nt.
2014
: 20
% o
f the
tota
l num
ber b
egin
ning
on
Janu
ary
18th
201
4
2015
: 40
% o
f the
tota
l num
ber b
egin
ning
on
Janu
ary
18th
201
5, le
ss a
ny o
ptio
ns
prev
ious
ly is
sued
.
2016
: 60
% o
f the
tota
l num
ber b
egin
ning
on
Janu
ary
18th
201
6, le
ss a
ny o
ptio
ns p
revi
-ou
sly
issu
ed.
2017
80
% o
f the
tota
l num
ber b
egin
ning
on
Janu
ary
18th
201
7, le
ss a
ny o
ptio
ns p
revi
-ou
sly
issu
ed.
2018
: 10
0% o
f the
tota
l num
ber b
egin
ning
on
Janu
ary
18th
201
8, le
ss a
ny o
ptio
ns p
revi
-ou
sly
issu
ed.
The
exer
cise
per
iod
shal
l in
no e
vent
be
late
r tha
n th
e da
te fa
lling
10
year
s af
ter
the
awar
d da
te.
The
grou
p ha
s no
lega
l or c
onst
ruct
ive
oblig
atio
n to
repu
rcha
se o
r set
tle
the
optio
ns in
cas
h.N
o op
tions
wer
e ex
erci
sed
durin
g 20
13.
The
wei
ghte
d av
erag
e fa
ir va
lue
of o
ptio
ns
gran
ted
durin
g th
e pe
riod
dete
rmin
ed
usin
g th
e Bl
ack-
Scho
les
valu
atio
n m
odel
w
as N
OK
3.7
2 pe
r opt
ion.
The
sign
ifica
nt in
puts
into
the
mod
el
wer
e w
eigh
ted
aver
age
shar
e pr
ice
of
NO
K 8
.45
at th
e gr
ant d
ate,
exe
rcis
e pr
ice
of N
OK
8.4
5, v
olat
ility
of 2
3%,
divi
dend
yie
ld o
f 0%
, an
expe
cted
opt
ion
life
of 1
0 ye
ars
and
an a
nnua
l ris
k-fr
ee
inte
rest
rate
of 4
.13%
.
The
vola
tility
mea
sure
d at
the
stan
dard
de
viat
ion
of c
ontin
uous
ly c
ompo
unde
d sh
are
retu
rns
is b
ased
on
stat
istic
al
anal
ysis
of d
aily
sha
re p
rices
ove
r the
la
st th
ree
year
s.
Tota
l exp
ense
reco
gnis
ed in
the
inco
me
stat
emen
t for
sha
re o
ptio
ns g
rant
ed to
ce
rtai
n em
ploy
ees
is U
SD 0
.2 m
illio
n.Va
lue
of e
mpl
oyee
ser
vice
s as
per
D
ecem
ber 3
1, 2
013
are
reco
gniz
ed u
nder
Re
tain
ed e
arni
ngs
at U
SD 3
,125
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
497
Mov
emen
ts in
the
num
ber o
f sha
re o
ptio
ns o
utst
andi
ng a
nd th
eir e
xerc
ise
pric
es a
re a
s fo
llow
s:
Exer
cise
pri
ce p
er
shar
e op
tion
, NO
K
(*w
eigh
ted
aver
age)
Opt
ions
O
utst
andi
ng
At 1
Jan
uary
201
3-
-
Gra
nted
8.45
14,0
00,0
00
Forf
eite
d-
-
Exer
cise
d-
-
Expi
red
--
At 3
1 D
ecem
ber
2013
8.45
14,0
00,0
00
At 1
Jan
uary
201
48.
4514
,000
,000
Gra
nted
9.07
3,00
0,00
0
Forf
eite
d-
-
Exer
cise
d-
-
Expi
red
--
At 3
1 D
ecem
ber
2014
*8.
56*
17,0
00,0
00
Opt
ions
out
stan
ding
at y
ear-
end
and
exer
cisa
ble
tota
l 2 8
00 0
00 o
ptio
ns a
nd n
il op
tions
for
2014
and
201
3, re
spec
tivel
y. O
ptio
ns e
xpire
10
year
s af
ter t
he d
ate
of g
rant
.
*Wei
ghte
d av
erag
e pr
ice
at 3
1 D
ecem
ber 2
014.
Opt
ions
out
stan
ding
for
key
man
agm
ent
Opt
ions
out
-st
andi
ng a
s of
31
Dec
embe
r 20
13
Opt
ions
out
-st
andi
ng a
s of
31
Dec
embe
r 20
14
Terje
Sør
ense
n, C
EO3,
000,
000
3,60
0,00
0
Dag
finn
Lie,
CFO
2,00
0,00
02,
400,
000
Svei
n Er
ik M
ykla
nd, C
OO
2,00
0,00
02,
400,
000
Bern
t Om
dal,
CC
O2,
000,
000
2,40
0,00
0
Tore
B. J
ohan
ness
en, G
loba
l HR
Dire
ctor
2,00
0,00
02,
400,
000
Cel
so C
osta
, Gen
eral
man
ager
1,00
0,00
01,
200,
000
Lars
Muc
k, G
ener
al m
anag
er1,
000,
000
1,20
0,00
0
Tor H
elge
Ege
land
, Gen
eral
man
ager
1,00
0,00
01,
200,
000
Gen
eral
man
ager
s-
200,
000
Tota
l out
stan
ding
14
,000
,000
17,0
00,0
00
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
498
Stat
emen
t on
Soci
al R
espo
nsib
ility
A
s a
com
pany
inco
rpor
ated
in th
e C
aym
an
Isla
nds,
Sie
m O
ffsh
ore
Inc.
(“Th
e C
om-
pany
”) is
an
exem
pted
com
pany
dul
y in
-co
rpor
ated
und
er th
e la
ws
of th
e C
aym
an
Isla
nds
and
subj
ect t
o C
aym
an Is
land
law
s an
d re
gula
tions
with
resp
ect t
o co
rpor
ate
gove
rnan
ce. C
aym
an Is
land
s co
rpor
ate
law
is to
a g
reat
ext
ent b
ased
on
Engl
ish
Law
. In
add
ition
, due
to T
he C
ompa
ny
bein
g a
Nor
weg
ian
Tax
Resi
dent
, the
N
orw
egia
n A
ccou
ntin
g la
w a
pplie
s to
The
C
ompa
ny. A
ccor
ding
to th
e N
orw
egia
n A
c-co
untin
g A
ct $
3-3c
The
Com
pany
sho
uld
prov
ide
a st
atem
ent o
n so
cial
resp
onsi
bil-
ity. T
he s
tate
men
t sho
uld
incl
ude
whi
ch
actio
ns a
re ta
ken
by T
he C
ompa
ny to
in
tegr
ate
hum
an ri
ghts
, em
ploy
ee’s
righ
ts
and
soci
al c
ondi
tions
, ext
erna
l env
iron-
men
t and
the
fight
aga
inst
cor
rupt
ion
in it
s bu
sine
ss s
trat
egie
s, d
aily
ope
ratio
ns a
nd
in re
latio
n to
its
inte
rest
ed p
artie
s.
The
Boar
d of
Dire
ctor
s ha
s re
view
ed th
is
CO
RP
OR
ATE
SO
CIA
L R
ESP
ON
SIB
ILIT
Y
stat
emen
t. It
is th
e op
inio
n of
the
Boar
d of
Dire
ctor
s th
at T
he C
ompa
ny c
om-
plie
s w
ith re
gula
tions
in th
e N
orw
egia
n A
ccou
ntin
g la
w w
ith re
spec
t to
Soci
al
Resp
onsi
bilit
y re
port
ing.
Cod
e of
Con
duct
The
Com
pany
has
est
ablis
hed
a C
ode
of
Con
duct
pol
icy
expr
essi
ng it
s no
n-to
ler-
ance
on
corr
uptio
n as
wel
l as
deal
ing
with
et
hica
l prin
cipl
es o
f the
Com
pany
. The
C
ompa
ny is
fully
com
mitt
ed to
per
form
its
bus
ines
s w
ith in
tegr
ity a
nd tr
ansp
ar-
ency
thro
ugho
ut it
s gl
obal
ope
ratio
ns. A
s st
ated
in th
e C
ode
of C
ondu
ct P
olic
y it
is
the
polic
y of
the
Com
pany
to c
ondu
ct it
s bu
sine
ss in
acc
orda
nce
with
all
appl
icab
le
law
s an
d re
gula
tions
and
in a
n et
hica
lly
resp
onsi
ble
man
ner.
Prot
ectio
n of
hea
lth, s
afet
y an
d th
e pr
even
tion
of p
ollu
tion
to th
e en
viro
nmen
t ar
e pr
imar
y go
als
of T
he C
ompa
ny. A
ll of
ou
r em
ploy
ees
and
repr
esen
tativ
es m
ust
cond
uct t
heir
dutie
s an
d re
spon
sibi
litie
s in
co
mpl
ianc
e w
ith T
he C
ompa
ny’s
pol
icy
on
Hea
lth, S
afet
y an
d En
viro
nmen
t, ap
plic
a-bl
e la
w a
nd in
dust
ry s
tand
ards
rela
ting
to h
ealth
and
saf
ety
in th
e w
orkp
lace
and
pr
even
tion
of p
ollu
tion
to th
e en
viro
nmen
t.
The
Com
pany
has
impl
emen
ted
polic
ies
and
cont
rol p
roce
dure
s to
ens
ure
that
onl
y pr
oper
tran
sact
ions
are
ent
ered
into
by
The
Com
pany
, tha
t suc
h tr
ansa
ctio
ns h
ave
prop
er m
anag
emen
t app
rova
l, th
at s
uch
tran
sact
ions
are
pro
perl
y ac
coun
ted
for i
n th
e bo
oks
and
reco
rds
of T
he C
ompa
ny,
and
the
repo
rts
and
finan
cial
sta
tem
ents
of
The
Com
pany
are
pre
pare
d in
a ti
mel
y m
anne
r, un
ders
tand
able
and
fully
, fai
rly
and
accu
rate
ly re
flect
suc
h tr
ansa
ctio
ns.
The
Com
pany
obs
erve
s fa
ir em
ploy
men
t pr
actic
es in
eve
ry a
spec
t of i
ts b
usin
ess.
The
Com
pany
con
duct
s its
bus
ines
s w
ith
hone
sty
and
inte
grity
and
com
pete
s fa
irly
MA
NG
LER
BILD
E!
Hap
py J
ayN
ii fo
otba
ll te
am,
Acc
ra, G
hana
Phot
o: E
llen
Ber
chel
man
n
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
499
and
ethi
cally
with
in th
e fr
amew
ork
of th
e la
w. T
he C
ompa
ny h
as e
nter
ed in
to a
gree
-m
ents
with
wel
l-kn
own
subc
ontr
acto
rs fo
r th
e de
liver
y of
tech
nica
l man
agem
ent a
nd
crew
man
agem
ent s
ervi
ces
to s
ome
of
the
Com
pany
’s v
esse
ls. T
he C
ompa
ny h
as
also
ent
ered
into
shi
pbui
ldin
g co
ntra
cts
with
hig
h st
anda
rd s
hipb
uild
ing
yard
s in
Po
land
and
Ger
man
y. T
hese
sub
cont
rac-
tors
are
sub
ject
to re
view
on
an o
ngoi
ng
basi
s. T
he C
ompa
ny e
xpec
ts th
at a
ll of
its
bus
ines
s pa
rtne
rs h
ave
the
sam
e ap
-pr
oach
to b
usin
ess
deal
ing.
Impr
oper
pay
men
tsTh
e C
ode
of C
ondu
ct d
oes
also
incl
ude
polic
ies
on im
prop
er p
aym
ents
. The
Com
-pa
ny d
oes
not t
oler
ate
any
actio
ns /
pay-
men
ts w
hich
cou
ld b
e vi
ewed
as
impr
oper
pa
ymen
ts.
No
gift
, hos
pita
lity
or tr
avel
ben
efit m
ay
be o
ffer
ed to
or r
eque
sted
or a
ccep
ted
from
any
third
par
ty if
that
ben
efit c
ould
be
see
n to
be
disp
ropo
rtio
nate
ly g
ener
ous
or o
ther
wis
e be
see
n as
som
ethi
ng w
hich
m
ay in
duce
or m
ake
the
reci
pien
t fee
l ob
liged
to re
cipr
ocat
e by
way
of i
mpr
op-
erly
per
form
ing
his
or h
er fu
nctio
n.
The
Com
pany
and
its
dire
ctor
s, o
ffice
rs
and
empl
oyee
s w
ill n
ot a
ccep
t any
gift
, ho
spita
lity
or tr
avel
ben
efit e
ither
dire
ctly
or
indi
rect
ly fr
om b
usin
ess
part
ners
, ag
ains
t mak
ing
com
mitm
ent,
reco
m-
men
ding
or p
rom
otin
g a
cert
ain
cond
uct
or p
ositi
on b
y Th
e C
ompa
ny o
r oth
erw
ise
seek
to g
ain
pers
onal
ben
efit i
n re
latio
n to
Th
e C
ompa
ny’s
bus
ines
s de
alin
gs.
Like
wis
e, th
e C
ompa
ny d
oes
not i
tsel
f of
fer i
nduc
emen
ts to
any
one
asso
ciat
ed
with
bus
ines
s pa
rtne
rs to
pro
mot
e a
cer-
tain
con
duct
or p
ositi
on b
y su
ch b
usin
ess
part
ner.
The
Com
pany
and
any
of i
ts p
eopl
e sh
all
not p
ay m
oney
or p
rovi
de g
ifts,
ent
erta
in-
men
t, ho
spita
lity
or a
ny o
ther
thin
g or
ser
-vi
ce o
f val
ue to
any
Gov
ernm
ent O
ffici
al.
This
pro
hibi
tion
exte
nds
to p
aym
ents
to
cons
ulta
nts,
age
nts
or o
ther
inte
rmed
iar-
ies
whe
n th
e pa
yer k
now
s or
has
reas
on to
be
lieve
that
som
e pa
rt o
f the
pay
men
t will
be
use
d to
brib
e or
oth
erw
ise
influ
ence
a
publ
ic o
ffici
al.
Polit
ical
con
trib
utio
ns a
re n
ot a
utho
rized
.
Cor
pora
te S
ocia
l Res
pons
ibili
ty
The
Com
pany
resp
ects
and
pro
mot
es
harm
onio
us w
orki
ng re
latio
nshi
p w
ith th
e lo
cal c
omm
uniti
es w
here
it o
pera
tes,
but
re
frai
ns fr
om p
artic
ipat
ing
in lo
cal p
oliti
cs.
The
Com
pany
see
ks to
fost
er a
sus
tain
-ab
le b
usin
ess
for i
ts m
any
stak
ehol
ders
.
The
Com
pany
is fu
lly c
omm
itted
to
com
ply
with
loca
l law
s an
d re
gula
tions
th
roug
hout
its
glob
al o
pera
tions
.
The
Com
pany
is c
omm
itted
to e
mpl
oy
loca
l sta
ff w
here
app
licab
le a
nd p
ossi
ble
in a
ll co
untr
ies
whe
re it
is o
pera
ting
and
cond
uctin
g bu
sine
ss. T
he C
ompa
ny is
co
mm
itted
to p
rovi
ding
equ
al o
ppor
tuni
ty
and
fair
trea
tmen
t to
all i
ndiv
idua
ls o
n th
e ba
sis
of m
erit,
with
out d
iscr
imin
atio
n on
the
grou
nds
of ra
ce, c
olou
r, re
ligio
n,
natio
nal o
rigin
, sex
, pre
gnan
cy, a
ge, d
is-
abili
ty, m
arita
l sta
tus
or o
ther
cha
ract
eris
-tic
s pr
otec
ted
by a
pplic
able
law
.
The
Com
pany
is d
edic
ated
in c
reat
ing
a hi
gh-q
ualit
y w
orki
ng e
nviro
nmen
t und
er
whi
ch it
s pe
ople
resp
ect a
nd tr
ust e
ach
othe
r suc
h th
at e
very
one
acts
in a
n ho
nest
, frie
ndly
and
pro
activ
e w
ay w
ith
a re
spon
sibl
e at
titud
e an
d hi
gh m
oral
st
anda
rds.
The
Com
pany
pro
hibi
ts b
ully
-in
g an
d ha
rass
men
t in
any
form
incl
udin
g se
xual
, rac
ial,
ethn
ic, a
nd o
ther
form
s of
ha
rass
men
t.
At C
hris
tmas
201
2 Th
e C
ompa
ny d
onat
ed
fund
s to
Jay
nii S
tree
twis
e in
Gha
na. N
o fu
nds
have
bee
n do
nate
d in
201
4. J
ayni
i St
reet
wis
e is
a c
harit
y an
d no
n-go
vern
-m
enta
l org
aniz
atio
n fo
unde
d in
Gha
na b
y Ja
y Bo
rqua
ye a
nd E
mm
anue
l (N
ii) Q
uart
ey
in th
e de
priv
ed a
rea
of J
ames
tow
n (A
c-cr
a) w
ith th
e ai
m o
f im
prov
ing
the
lives
of
child
ren
and
yout
h. J
ayni
i Str
eetw
ise
was
bo
rn o
ut o
f the
ir Ja
ynii
Cul
tura
l Tro
upe,
a
trad
ition
al m
usic
and
dan
ce g
roup
whi
ch
has
perf
orm
ed a
t cou
ntle
ss fu
nctio
ns lo
-ca
lly a
nd in
tern
atio
nally
.
Ove
r tim
e, J
ayni
i has
iden
tified
the
need
to
sup
port
ong
oing
eff
orts
by
gove
rnm
ent
and
civi
l soc
iety
to k
eep
child
ren
off t
he
stre
ets
and
in s
choo
l. A
s a
poor
, mar
gin-
aliz
ed a
nd d
epriv
ed a
rea,
man
y ch
ildre
n ar
e fo
und
wal
king
on
the
beac
h an
d in
the
stre
ets
durin
g sc
hool
hou
rs. M
ost o
f the
se
child
ren
com
e fr
om v
ery
depr
ived
hom
es.
So fa
r Jay
nii h
as id
entifi
ed fi
fty
child
ren
aged
bet
wee
n 4
to 1
6 ye
ars
who
hav
e be
en e
nrol
led
into
the
Stre
etw
ise
Proj
ect,
base
d at
Jay
nii B
each
, a s
mal
l str
etch
of
beac
h ju
st b
elow
the
Jam
esto
wn
light
-ho
use
whi
ch is
now
thei
r cen
tre.
Thes
e 24
girl
s an
d 26
boy
s, w
ho w
ere
spen
ding
thei
r chi
ldho
od w
alki
ng a
im-
less
ly o
n th
e Ja
mes
tow
n Be
ach,
are
now
en
rolle
d at
sch
ools
in th
e co
mm
uniti
es-
Acc
ra S
empe
Prim
ary
Scho
ol in
Cla
sses
1
to 6
and
St.
Thom
as D
a y C
are
Cen
tre.
Ja
ynii,
with
out a
ssis
tanc
e fr
om p
aren
ts,
buys
them
sch
ool u
nifo
rms,
sho
es, b
ags
and
exer
cise
boo
ks a
nd re
gist
ers
them
in
scho
ol.
Aft
er s
choo
l hou
rs, t
he c
hild
ren
go to
Jay
nii B
each
whe
re th
ey g
et fe
d as
w
ell a
s ge
t ext
ra c
lass
es, h
omew
ork
help
an
d af
tern
oon
activ
ities
and
ent
erta
in-
men
t.D
urin
g 20
13 th
e C
ompa
ny h
as a
lso
dona
ted
fund
s fo
r the
fune
ral a
nd fa
mily
su
ppor
t of p
asse
d aw
ay g
arde
ner o
f the
C
ompa
ny’s
offi
ce in
Gha
na.
The
Com
pany
has
furt
herm
ore
prev
ious
ly
dona
ted
fund
s to
Pro
Cria
nça
Car
díac
a in
Rio
de
Jane
iro, B
rasi
l, a
non-
profi
t or
gani
zatio
n he
lpin
g ch
ildre
n w
ith h
eart
di
seas
es. P
ro C
rianç
a C
ardí
aca
is a
hos
pi-
tal f
ound
ed in
199
6 by
Car
diol
ogis
t Doc
tor
Cel
ia R
ose.
The
mis
sion
of t
he o
rgan
iza-
tion
is to
pro
vide
med
ical
car
e to
car
diac
ch
ildre
n fo
cusi
ng in
car
diac
sur
gery
and
an
y ot
her p
roce
dure
that
requ
ires
high
te
chno
logy
trea
tmen
t to
child
ren.
No
fund
s ha
ve b
een
dona
ted
in 2
014.
The
Com
pany
has
als
o m
ade
dona
tions
to
the
Nor
weg
ian
Salv
atio
n A
rmy,
Red
ning
s-se
lska
pet a
nd th
e st
reet
mag
azin
e “K
lar”
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
410
0
NO
TE
S T
O T
HE
AC
CO
UN
TS
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
410
1SI
EM O
FFSH
ORE
INC.
, AN
NU
AL
REPO
RT 2
014
102
Eyst
ein
Erik
srud
Kri
stia
n Si
emJo
hn C
. Wal
lace
Ch
air
ma
nD
ire
cto
rD
ire
cto
r
(Sig
n.)
(Sig
n.)
(Sig
n.)
Mic
hael
Del
ouch
eD
avid
Mul
len
Terj
e Sø
rens
en
Dir
ec
tor
Dir
ec
tor
Ch
ief
Exe
cu
tive
Offi
ce
r
(Sig
n.)
(Sig
n.)
(Sig
n.)
We
confi
rm, t
o th
e be
st o
f our
kno
wle
dge
that
the
finan
cial
st
atem
ents
for t
he p
erio
d 1
Janu
ary
to 3
1 D
ecem
ber 2
014
have
bee
n pr
epar
ed in
acc
orda
nce
with
cur
rent
app
licab
le a
c-co
untin
g st
anda
rds,
and
giv
e a
true
and
fair
view
of t
he a
sset
s,
liabi
litie
s, fi
nanc
ial p
ositi
on a
nd p
rofit
or l
oss
of th
e en
tity
and
the
grou
p ta
ken
as a
who
le. W
e al
so c
onfir
m th
at th
e B
oard
of
Dire
ctor
s’ R
epor
t inc
lude
s a
true
and
fair
revi
ew o
f the
dev
elop
-m
ent a
nd p
erfo
rman
ce o
f the
bus
ines
s an
d th
e po
sitio
n of
the
entit
y an
d th
e gr
oup,
toge
ther
with
a d
escr
iptio
n of
the
prin
cipa
l ris
ks a
nd u
ncer
tain
ties
faci
ng th
e en
tity
and
the
grou
p.
13 A
pril
2015
RES
PO
NS
IBIL
ITY
STAT
EM
EN
T
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
410
3
Eyst
ein
Erik
srud
(bor
n 19
70),
Cha
irM
r. Er
iksr
ud is
the
Dep
uty
CEO
of S
iem
In
dust
ries
Inc.
, the
Com
pany
’s m
ain
shar
ehol
der.
He
is fu
rthe
r the
cha
irman
of
Ele
ctro
mag
netic
Geo
serv
ices
ASA
and
a
dire
ctor
of S
ubse
a7 In
c. P
rior t
o jo
inin
g Si
em In
dust
ries
in O
ctob
er 2
011,
he
was
pa
rtne
r of t
he N
orw
egia
n la
w fi
rm W
ier-
shol
m M
ellb
ye &
Bec
h si
nce
2005
wor
k-in
g as
a b
usin
ess
law
yer w
ith a
n in
tern
a-tio
nally
orie
nted
pra
ctic
e in
mer
gers
and
ac
quis
ition
s, c
ompa
ny la
w a
nd s
ecur
ities
la
w, p
artic
ular
ly in
the
ship
ping
, off
shor
e an
d oi
l ser
vice
sec
tors
. He
was
Gro
up
Com
pany
Sec
reta
ry o
f the
Kva
erne
r Gro
up
from
200
0-20
02 a
nd s
erve
d as
Gro
up
Gen
eral
Cou
nsel
of t
he S
iem
Indu
strie
s G
roup
from
200
2-20
05. H
e ha
s se
rved
on
the
boar
ds o
f Priv
atba
nken
ASA
and
Ti
nfos
AS
as w
ell a
s a
num
ber o
f oth
er
boar
ds. E
riksr
ud is
a N
orw
egia
n ci
tizen
.
Kri
stia
n Si
em (b
orn
1949
), B
oard
mem
ber
Mr.
Siem
is c
hairm
an o
f Sie
m In
dust
ries
Inc.
, Sub
sea
7 S.
A. a
nd S
iem
Indu
strik
api-
tal A
B an
d a
dire
ctor
of S
iem
Shi
ppin
g In
c.,
Flen
sbur
ger S
chiff
bau-
Ges
ells
chaf
t mbH
&
Co.
KG
, Nor
th A
tlan
tic S
mal
ler C
ompa
-ni
es In
vest
men
t Tru
st p
lc. a
nd N
KT
Hol
d-in
g A
/S. M
r. Si
em is
a N
orw
egia
n ci
tizen
.
BO
AR
D O
F D
IREC
TOR
S Mic
hael
Del
ouch
e (b
orn
1957
), B
oard
mem
ber
Mr.
Del
ouch
e is
the
pres
iden
t and
the
secr
etar
y of
Sie
m In
dust
ries
Inc.
and
is
in c
harg
e of
the
Com
pany
’s o
pera
tions
at
the
head
offi
ce in
Geo
rge
Tow
n, C
aym
an
Isla
nds.
He
is a
dire
ctor
of S
iem
Shi
ppin
g In
c. a
nd a
form
er d
irect
or o
f Sub
sea
7 In
c. M
r. D
elou
che
rece
ived
deg
rees
in c
ivil
engi
neer
ing
(str
uctu
ral)
and
busi
ness
and
w
as p
revi
ousl
y an
aud
it m
anag
er w
ith
KPM
G P
eat M
arw
ick
LLP.
Mr.
Del
ouch
e is
a
US
citiz
en.
Dav
id M
ulle
n (b
orn
1958
), B
oard
mem
ber
Dav
id M
ulle
n is
the
foun
der a
nd C
EO o
f Sh
elf D
rillin
g, a
n in
tern
atio
nal s
hallo
w
wat
er d
rillin
g co
ntra
ctor
. Sin
ce th
e co
m-
pany
’s in
cept
ion
in N
ovem
ber 2
012,
Dav
id
has
lead
She
lf D
rillin
g th
roug
h a
serie
s of
co
mpl
ex tr
ansa
ctio
ns in
est
ablis
hing
She
lf D
rillin
g w
ith a
flee
t of 3
7 Ja
ck-u
ps a
nd 1
sw
amp
barg
e an
d 2
new
bui
ld ri
gs u
nder
co
nstr
uctio
n. P
rior t
o Sh
elf D
rillin
g, D
avid
w
as C
EO o
f Wel
lste
am H
oldi
ngs
PLC,
a
UK
-lis
ted
com
pany
that
des
igns
, man
u-fa
ctur
es a
nd s
ervi
ces
subs
ea p
ipel
ine
prod
ucts
. Fro
m 2
008
- 201
0, D
avid
ser
ved
as C
EO o
f Oce
an R
ig A
SA, a
Nor
way
-lis
ted
ultr
a-de
ep w
ater
dril
ling
cont
ract
or. P
rior
to 2
008
Dav
id h
eld
exec
utiv
e m
anag
e-m
ent p
ositi
ons
with
Tra
nsoc
ean
and
Schl
umbe
rger
Lim
ited,
incl
udin
g a
23 y
ear
care
er w
ith S
chlu
mbe
rger
Lim
ited.
John
C. W
alla
ce (b
orn
1938
), B
oard
mem
ber
John
C. W
alla
ce is
a C
hart
ered
Acc
ount
-an
t hav
ing
qual
ified
with
Pric
ewat
erho
use-
Coo
pers
in C
anad
a in
196
3, a
fter
whi
ch h
e jo
ined
Bar
ing
Bro
ther
s &
Co.
, Lim
ited
in
Lond
on, E
ngla
nd. P
rior t
o hi
s re
tirem
ent
in 2
010,
he
serv
ed fo
r ove
r tw
enty
-five
ye
ars
as C
hairm
an o
f Fre
d. O
lsen
Ltd
., a
Lond
on-b
ased
cor
pora
tion
that
he
join
ed
in 1
968
and
whi
ch s
peci
aliz
es in
the
busi
-ne
ss o
f shi
ppin
g, re
new
able
ene
rgy
and
prop
erty
dev
elop
men
t. H
e re
ceiv
ed h
is B
. C
omm
deg
ree
maj
orin
g in
Acc
ount
ing
and
Econ
omic
s fr
om M
cGill
Uni
vers
ity in
195
9.
In N
ovem
ber 2
004,
he
succ
essf
ully
com
-pl
eted
the
Inte
rnat
iona
l Uni
form
Cer
tified
Pu
blic
Acc
ount
ant Q
ualifi
catio
n Ex
amin
a-tio
n an
d ha
s re
ceiv
ed a
CPA
Cer
tifica
te
from
the
Stat
e of
Illin
ois.
Mr.
Wal
lace
al
so re
tired
from
the
boar
d of
dire
ctor
s of
G
ange
r Rol
f ASA
and
Bon
heur
ASA
, Osl
o,
both
pub
licly
-tra
ded
ship
ping
com
pani
es
with
inte
rest
s in
off
shor
e en
ergy
ser
vice
s an
d re
new
able
ene
rgy.
He
is a
Dire
ctor
of
Cal
lon
Petr
oleu
m C
o , U
SA w
here
he
is
Cha
irman
of t
he A
udit
Com
mitt
ee. H
e w
as
indu
cted
as
a 20
11 In
dust
ry P
ione
er b
y th
e O
ffsh
ore
Ener
gy C
entr
e in
Hou
ston
. Mr.
Wal
lace
is a
Can
adia
n ci
tizen
.
The
Com
pany
has
a B
oard
of fi
ve D
irect
ors.
Mem
bers
of t
he
Com
pany
’s m
anag
emen
t are
not
mem
bers
of t
he B
oard
, but
th
e co
mpa
ny’s
man
agem
ent d
oes
atte
nd B
oard
mee
tings
.
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
410
4
Siem
Off
shor
e In
c. w
ill re
leas
e fin
anci
al fi
gure
s on
the
follo
win
g da
tes
in 2
015:
Q1
2015
Wed
nesd
ay 2
0 M
ay
Q2
2015
Th
ursd
ay 2
0 A
ugus
t
Q3
2015
Th
ursd
ay 2
9 O
ctob
er
The
Ann
ual G
ener
al M
eetin
g of
the
com
pany
will
be
held
on
Frid
ay 1
May
201
5.
FIN
AN
CIA
L C
ALE
ND
AR
201
5
SIEM
OFF
SHO
RE IN
C., A
NN
UA
L RE
PORT
201
410
5
INNOVENTI
SIE
M O
FF
SH
OR
E I
NC
., A
NN
UA
L R
EP
OR
T 2
01
4
Siem
Off
shor
e In
c
Nod
evig
a 14
4610
Kris
tians
and
Nor
way
Post
al a
ddre
ss:
P.O
. Box
425
N-4
664
Kris
tians
and
S, N
orw
ay
Tele
phon
e:
+47
38
60 0
4 00
Tele
fax:
+
47 3
7 40
62
86
E-m
ail:
siem
offs
hore
@si
emof
fsho
re.c
om
www.siemoffsh
ore.com
SIEM OFFSHORE INC. RIGHTS ISSUE
SUBSCRIPTION FORM Securities no. ISIN KYG813131011
General information: The terms and conditions of the Rights Issue by Siem Offshore Inc. (the “Company”) are set out in the prospectus dated 17 August 2015 (the “Prospectus”). Terms defined in the Prospectus shall have the same meaning in this Subscription Form. All announcements referred to in this Subscription Form will be made through Oslo Børs’ information system under the Company’s ticker “SIOFF”.
Subscription procedures: The subscription period is from 19 August 2015 to 16:30 hours (CET) on 2 September 2015 (the “Subscription Period”). Correctly completed Subscription Forms must be received by the Manager or the Receiving Agent before the end of the Subscription Period at one of the following addresses: Swedbank, P.O Box 1441 Vika, N-0115 Oslo, Norway, telefax +47 23 23 80 11 or DNB Markets, Registrar Department, P.O. Box 1600 Sentrum, N-0021 Oslo, Norway, [email protected] (the “Subscription Offices”). The subscriber is responsible for the correctness of the information filled in on the Subscription Form. Subscription Forms that are incomplete or incorrectly completed, or that are received after the end of the Subscription Period, and any subscription that may be unlawful, may be disregarded, at the discretion of the Manager or the Receiving Agent on behalf of the Company. Subscribers who are residents of Norway with a Norwegian personal identification number may also subscribe for Offer Shares through the VPS online subscription system by following the link on any of the following websites: www.swedbank.no or www.dnb.no/emisjoner. Subscriptions made through the VPS online subscription system must be duly registered before the expiry of the Subscription Period. Neither the Company, the Manager nor the Receiving Agent may be held responsible for postal delays, unavailable fax lines, internet lines or servers or other logistical or technical problems that may result in subscriptions not being received in time or at all by the Subscription Offices. Subscriptions are irrevocable and binding upon receipt and cannot be withdrawn, cancelled or modified by the subscriber after having been received by an Subscription Office, or in the case of subscriptions through the VPS online subscription system, upon registration of the subscription.
Subscription Price: The Subscription Price in the Rights Issue is NOK 1.80 per Offer Share. Subscription Rights: Registered holders of the Company’s shares (the “Existing Shareholders”) as appearing in the VPS as of 18 August 2015 (the “Record Date”) will be granted Subscription Rights giving a preferential right to subscribe for, and be allocated, the Offer Shares. Each Existing Shareholder will be granted 1.1724 Subscription Rights per existing share registered with the respective Existing Shareholder on the Record Date. The number of Subscription Rights issued to each Existing Shareholder will be rounded down to the nearest whole Subscription Right. Each Subscription Right will, subject to applicable securities laws, give the right to subscribe for and be allocated one Offer Share in the Rights Issue. Over-subscription and subscription without Subscription Rights is permitted. Subscription Rights not used to subscribe for Offer Shares before 31 August 2015 will lapse without compensation to the holder, and, consequently, will be of no value from that point in time. Allocation of Offer Shares: The Offer Shares will be allocated to the subscribers based on the allocation criteria set out in the Prospectus. The Company reserves the right to reject or reduce any subscription for Offer Shares not covered by Subscription Rights. The Company will not allocate fractional Offer Shares. Allocation of fewer Offer Shares than subscribed for does not impact on the subscriber’s obligation to pay for the Offer Shares allocated. Notification of allocated Offer Shares and the corresponding subscription amount to be paid by each subscriber is expected to be distributed in a letter from the VPS on or about 4 September 2015. Subscribers who have access to investor services through an institution that operates the subscriber’s VPS account should be able to see how many Offer Shares they have been allocated from 12:00 hours (CET) on or about 4 September 2015.
Payment: In completing this Subscription Form, or registering a subscription through the VPS online subscription system, subscribers authorise each of Swedbank and DNB Markets to debit the subscriber’s Norwegian bank account for the total subscription amount payable for the Offer Shares allocated to the subscriber. Accounts will be debited on or about 14 September 2015 (the “Payment Date”), and there must be sufficient funds in the stated bank account from and including the date falling 2 banking day prior to the Payment Date. Subscribers who do not have a Norwegian bank account must ensure that payment for the allocated Offer Shares is made on or before the Payment Date. Details and instructions can be obtained by contacting Swedbank, telephone: +47 23 23 80 00 or DNB Markets, telephone: + 47 22 94 88 80. Swedbank and DNB Markets together are only authorized to debit each account once, but reserves the right (but has no obligation) to make up to three debit attempts through 21 September 2015 if there are insufficient funds on the account on the Payment Date. Should any subscriber have insufficient funds in his or her account, should payment be delayed for any reason, if it is not possible to debit the account or if payments for any other reasons are not made when due, overdue interest will accrue and other terms will apply as set out under the heading “Overdue and missing payments” below. PLEASE SEE PAGE 2 OF THIS SUBSCRIPTION FORM FOR OTHER PROVISIONS THAT ALSO APPLY TO THE SUBSCRIPTION
DETAILS OF THE SUBSCRIPTION Subscriber’s VPS account: Number of Subscription Rights:
Number of Offer Shares subscribed (incl. over-subscription):
(For broker: consecutive no.):
SUBSCRIPTION RIGHT’S SECURITIES NUMBER: ISIN KYG812291097
Subscription Price per Offer Share:
NOK 1.80
Subscription amount to be paid:
NOK
IRREVOCABLE AUTHORIZATION TO DEBIT ACCOUNT (MUST BE COMPLETED BY SUBSCRIBERS WITH A NORWEGIAN BANK ACCOUNT)
Norwegian bank account to be debited for the payment for Offer Shares allocated (number of Offer Shares allocated x NOK 1.80).
(Norwegian bank account no.) I/we hereby irrevocably (i) subscribe for the number of Offer Shares specified above subject to the terms and conditions set out in this Subscription Form and in the Prospectus, (ii) authorize and instruct each of the Manager and the Receiving Agent (or someone appointed by any of them) acting jointly or severally to take all actions required to transfer such Offer Shares allocate to me/us to the VPS Registrar and ensure delivery of the beneficial interests to such Offer Shares to me/us in the VPS, on my/our behalf, (iii) authorize Swedbank and DNB Markets to debit my/our bank account as set out in this Subscription Form for the amount payable for the Offer Shares allotted to me/us, and (iv) confirm and warrant to have read the Prospectus and that I/we are eligible to subscribe for Offer Shares under the terms set forth therein.
Place and date must be dated in the Subscription Period.
Binding signature The subscriber must have legal capacity. When signed on behalf of a company or pursuant to an authorization, documentation in the form of a company certificate
or power of attorney must be enclosed.
INFORMATION ON THE SUBSCRIBER – ALL FIELDS MUST BE COMPLETED First name
Surname/company
Street address
Post code/district/ country
Personal ID number/ organization number
Nationality
E-mail address
Daytime telephone number
ADDITIONAL GUIDELINES FOR THE SUBSCRIBER
Regulatory issues: In accordance with the Markets in Financial Instruments Directive (“MiFID”) of the European Union, Norwegian law imposes requirements in relation to business investments. In this respect, the Manager and the Receiving Agent must categorize all new clients in one of three categories: eligible counterparties, professional clients and non-professional clients. All subscribers in the Rights Issue who are not existing clients of either the Manager or the Receiving Agent will be categorized as non-professional clients. Subscribers can, by written request to either the Manager or the Receiving Agent, ask to be categorized as a professional client if the subscriber fulfils the applicable requirements of the Norwegian Securities Trading Act. For further information about the categorization, the subscriber may contact Swedbank (Sedbank, Filipstad Brygge 1, P.O Box 1441 Vika, N-0115 Oslo, Norway) or DNB Markets (DNB Markets, KSC - Customer Administration, P.O. Box 7100, NO5020 Bergen, Norway or www.dnb.no/en/mifid). The subscriber represents that he/she/it is capable of evaluating the merits and risks of a decision to invest in the Company by subscribing for Offer Shares, and is able to bear the economic risk, and to withstand a complete loss, of an investment in the Offer Shares.
Selling Restrictions: The attention of persons who wish to subscribe for Offer Shares is drawn to Section 14 “Selling and transfer restrictions” of the Prospectus. The Company is not taking any action to permit a public offering of the Subscription Rights or the Offer Shares (pursuant to the exercise of the Subscription Rights or otherwise) in any jurisdiction other than Norway. Receipt of the Prospectus will not constitute an offer in those jurisdictions in which it would be illegal to make an offer and, in those circumstances, the Prospectus is for information only and should not be copied or redistributed. Persons outside Norway should consult their professional advisors as to whether they require any governmental or other consent or need to observe any other formalities to enable them to subscribe for Offer Shares. It is the responsibility of any person wishing to subscribe for Offer Shares under the Rights Issue to satisfy himself as to the full observance of the laws of any relevant jurisdiction in connection therewith, including obtaining any governmental or other consent which may be required, the compliance with other necessary formalities and the payment of any issue, transfer or other taxes due in such territories. The Subscription Rights and Offer Shares have not been registered, and will not be registered, under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) and may not be offered, sold, taken up, exercised, resold, delivered or transferred, directly or indirectly, within the United States, except pursuant to an applicable exemption from the registration requirements of the U.S. Securities Act and in compliance with the securities laws of any state or other jurisdiction of the United States. The Subscription Rights and Offer Shares have not been and will not be registered under the applicable securities laws of Australia, Canada or Japan and may not be offered, sold, taken up, exercised, resold, delivered or transferred, directly or indirectly, in or into Australia, Canada or Japan. This Subscription Form does not constitute an offer to sell or a solicitation of an offer to buy Offer Shares in any jurisdiction in which such offer or solicitation is unlawful. A notification of exercise of Subscription Rights and subscription of Offer Shares in contravention of the above restrictions may be deemed to be invalid. By subscribing for the Offer Shares, persons effecting subscriptions will be deemed to have represented to the Company that they, and the persons on whose behalf they are subscribing for the Offer Shares, have complied with the above selling restrictions.
Execution Only: The Manager or the Receiving Agent will treat the Subscription Form as an execution-only instruction. The Managerand the Receiving Agent are not required to determine whether an investment in the Offer Shares is appropriate or not for the subscriber. Hence, the subscriber will not benefit from the protection of the relevant conduct of business rules in accordance with the Norwegian Securities Trading Act.
Information exchange: The subscriber acknowledges that, under the Norwegian Securities Trading Act and the Norwegian Commercial Banks Act and foreign legislation applicable to the Manager and the Receiving Agent there is a duty of secrecy between the different units of each of the Manager and the Receiving Agent as well as between the Manager and the Receiving Agent and the other entities in their respective groups. This may entail that other employees of the Manager and the Receiving Agent or the their respective groups may have information that may be relevant to the subscriber and to the assessment of the Offer Shares, but which the Manager or the Receiving Agent will not have access to in their capacity as Manager and Receiving Agent for the Offering.
Information barriers: The Manager and the Receiving Agent are securities firms that offer a broad range of investment services. In order to ensure that assignments undertaken in the Manager and the Receiving Agent's corporate finance departments are kept confidential, the Manager and the Receiving Agent's other activities, including analysis and stock broking, are separated from the their respective corporate finance departments by information walls. Consequently the subscriber acknowledges that the Manager and the Receiving Agent's analysis and stock broking activity may conflict with the subscriber’s interests with regard to transactions in the Shares, including the Offer Shares.
VPS account and mandatory anti-money laundering procedures: The Offering is subject to the Norwegian Money Laundering Act of 6 March 2009 No. 11 and the Norwegian Money Laundering Regulations of 13 March 2009 No. 302 (collectively, the “Anti-Money Laundering Legislation”). Subscribers who are not registered as existing customers of either the Manager or the Receiving Agent must verify their identity to one of the Manager and the Receving Agent in accordance with requirements of the Anti-Money Laundering Legislation, unless an exemption is available. Subscribers who have designated an existing Norwegian bank account and an existing VPS account on the Subscription Form are exempted, unless verification of identity is requested by the Manager or Receiving Agent. Subscribers who have not completed the required verification of identity prior to the expiry of the Subscription Period will not be allocated Offer Shares. Participation in the Offering is conditional upon the subscriber holding a VPS account. The VPS account number must be stated in the subscription form. VPS accounts can be established with authorized VPS registrars, who can be Norwegian banks, authorized securities brokers in Norway and Norwegian branches of credit institutions established within the EEA. Establishment of a VPS account requires verification of identity to the VPS registrar in accordance with the Anti-Money Laundering Legislation. However, non-Norwegian investors may use nominee VPS accounts registered in the name of a nominee. The nominee must be authorized by the Financial Supervisory Authority of Norway.
Terms and conditions for payment by direct debiting - securities trading: Payment by direct debiting is a service the banks in Norway provide in cooperation. In the relationship between the payer and the payer’s bank the following standard terms and conditions apply:
a) The service “Payment by direct debiting – securities trading” is supplemented by the account agreement between the payer and the payer’s bank, in particular Section C of the account agreement, General terms and conditions for deposit and payment instructions.
b) Costs related to the use of “Payment by direct debiting – securities trading” appear from the bank’s prevailing price list, account information and/or information given in another appropriate manner. The bank will charge the indicated account for costs incurred.
c) The authorization for direct debiting is signed by the payer and delivered to the beneficiary. The beneficiary will deliver the instructions to its bank that in turn will charge the payer’s bank account.
d) In case of withdrawal of the authorization for direct debiting the payer shall address this issue with the beneficiary. Pursuant to the Norwegian Financial Contracts Act the payer’s bank shall assist if the payer withdraws a payment instruction that has not been completed. Such withdrawal may be regarded as a breach of the agreement between the payer and the beneficiary.
e) The payer cannot authorize payment of a higher amount than the funds available on the payer’s account at the time of payment. The payer’s bank will normally perform a verification of available funds prior to the account being charged. If the account has been charged with an amount higher than the funds available, the difference shall immediately be covered by the payer.
f) The payer’s account will be charged on the indicated date of payment. If the date of payment has not been indicated in the authorization for direct debiting, the account will be charged as soon as possible after the beneficiary has delivered the instructions to its bank. The charge will not, however, take place after the authorization has expired as indicated above. Payment will normally be credited the beneficiary’s account between one and three working days after the indicated date of payment/delivery.
g) If the payer’s account is wrongfully charged after direct debiting, the payer’s right to repayment of the charged amount will be governed by the account agreement and the Norwegian Financial Contracts Act.
Overdue and missing payments: Overdue payments will be charged with interest at the applicable rate under the Norwegian Act on Interest on Overdue Payment of 17 December 1976 No. 100; 9.00% per annum as of the date of the Prospectus. If the subscriber fails to comply with the terms of payment or should payments not be made when due, the subscriber will remain liable for payment of the Offer Shares allocated to it and the Offer Shares allocated to such subscriber will not be delivered to the subscriber. In such case the Company, Swedbank and DNB Markets reserve the right to, at any time and at the risk and cost of the subscriber, re-allot, cancel or reduce the subscription and the allocation of the allocated Offer Shares, or, if payment has not been received by the third day after the Payment Date, without further notice sell, assume ownership to or otherwise dispose of the allocated Offer Shares in accordance with applicable law. If Offer Shares are sold on behalf of the subscriber, such sale will be for the subscriber’s account and risk and the subscriber will be liable for any loss, costs, charges and expenses suffered or incurred by the Company, Swedbank and/or DNB Markets as a result of, or in connection with, such sales. The Company, Swedbank and/or DNB Markets may enforce payment for any amounts outstanding in accordance with applicable law.
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Siem Offshore Inc.
Harbour Place 5th Floor P.O.Box 10718 George Town
Grand Cayman KY1-1006 Cayman Islands
Siem Offshore Management AS Nodeviga 14
4610 Kristiansand Norway
Lead Manager
Swedbank Filipstad Brygge 1 P.O Box 1441 Vika
N-0115 Oslo Norway
Tel: +47 23 23 80 00 Fax: +47 23 23 80 11
www.swedbank.no
Receiving Agent
DNB Markets Registrars Department Dronning Eufemias gate 30
P.O. Box 1600 Sentrum N-0021 Oslo
Norway Tel.: +47 23 26 81 01 Email: [email protected]
www.dnb.no/emisjoner
Legal counsel
Advokatfirmaet Wiersholm AS Dokkveien 1
Postboks 1400 Vika, 0115 Oslo Norway
Tel: +47 21 02 10 00