BOURBON : - Press Release: 1st Half 2015 Results

Paris, September 9, 2015

BOURBON 1^st Half 2015 Results: Adjusted EBITDAR generated by the fleet reached €290.4 million, a 26% increase compared with the 1^st half 2014

• Record adjusted EBITDAR is the result of:
  • Fleet size increase of 2.6%
  • 96.4% availability rate, well above target
  • Positive impact of the US$ exchange rate
• In the first half of 2015, adjusted EBIT of €48.8 million, excluding capital gain,  increased 40% compared with H1 2014 and was stable compared with the previous semester due to:
  • Good cost management
  • Positive impact of adjusted EBITDAR generated
  • Negative impact of utilization rate (-3.4pt) and of the average daily rates in dollars (-2.6%)
• Net Loss (group share) limited to €19.2 million
• During the first half of 2015, free cash flow amounted to €127 million

*** effect of consolidation of  jointly controlled companies using the equity method.
(a) see page 2

"In the current market environment, clients are looking to their service providers to help them achieve their cost reduction objectives", says Christian Lefèvre, Chief Executive Officer of BOURBON. "BOURBON has been responding to its clients' needs through cost control initiatives and improving operational efficiency. In the first half of 2015, we have once again exceeded the targets set, by achieving a technical availability rate of 96.4% for the entire fleet. Thus, BOURBON is delivering to its clients the safest, most efficient and cost effective operation possible."

 (a) Adjusted data:

The adjusted financial information is presented by Activity and by Segment based on the internal reporting system and shows internal segment information used by the principal operating decision maker to manage and measure the performance of BOURBON (IFRS 8). As of January 1, 2015, the internal reporting (and thus the adjusted financial information) records the performance of operational joint ventures on which the group has joint control using the full integration method. Adjusted comparative figures are restated accordingly.

Half year 2015 market and operational highlights

• The global deepwater PSV fleet is facing overcapacity as projects cancelled and postponed are mostly in deepwater exploration projects
• BOURBON is focused on operational excellence in execution:
  • Safety remains a strength at BOURBON, with TRIR (Total Recordable Incident Rate per million hours worked) improving to 0.69
  • Strong Technical availability of 96.4% in the first half of 2015 far exceeds our BOURBON 2015 target of 95%
  • Cost control remains a high priority in order to continuously improve the efficiency of the fleet

Half year 2015 results highlights

• At constant exchange rates, the reduction in adjusted costs (excluding bareboat charters) for the 1st half 2015 versus 2nd half 2014 is approximately 3%
• EBITDAR as a percent of revenues, which increased almost 4 points compared with the 1^st half 2014, showed stable, high performance in Deepwater and significant improvements in Shallow water, Crew boats and Subsea, all showing the benefits of continued cost control efforts
• There was an increase in bareboat charter costs in the first half 2015 compared with the same period last year, from €45.2 million to €87.8 million, as the vessels sold over the course of 2014 had their full rental cost impact during the current period as well as the impact of the €/$ exchange rate increasing the euro value of the rents
• Compared with the 1^st half 2014, Financial profit/loss was primarily impacted by foreign exchange differences, partially offset by a slight reduction in cost of debt

MARINE SERVICES

The adjusted EBITDAR/Revenue margin increased almost 4 points year on year, which was partially aided by the favorable exchange rates and also reflecting improved cost control. The cost control efforts are also seen when comparing total costs versus the second half of 2014 as costs remained flat. The stacking of vessels also contributed to the improvement in costs during the period.

Marine Services: Deepwater offshore vessels

The good growth in adjusted EBITDAR enabled the margin as a percentage of revenues to remain stable compared with a year ago, while being slightly aided by the stacking of vessels (up to 6 during the period). Adjusted EBITDA increased 15% while absorbing a significant increase in the amount of bareboat charter costs. There was a significant improvement in the technical availability rate as a result of a decrease in the amount of classification drydocks during the period.

Marine Services: Shallow water offshore vessels

Good cost control combined with revenue growth aided by the strength of the US dollar lead to a 26% increase in adjusted EBITDAR compared with the prior year period and a strong 4.4 point increase in the margin as a percentage of adjusted revenues. The stacking of up to 20 vessels during the period also contributed to the reduction of costs as stacked vessels have minimal operating costs. A further improvement in the technical availability rates to almost 98% due to lower levels of maintenance compared with the prior periods enabled the Shallow water segment to once again exceed the 2015 year-end target.

Marine Services: Crewboat vessels

Costs reduced by a greater percentage than the reduction of the fleet compared with the same period last year and when combined with the increase in adjusted revenues, the result is a significant increase in adjusted EBITDAR by over 35% and a more than 7 point increase as a percentage of revenues.

Subsea Services

Benefitting from a combination of cost reductions and the stacking of vessels, overall costs only increased by 17%, while the fleet grew by a slightly larger proportion. Combined with the nearly 25% growth in adjusted revenues, Subsea Services was able to increase its margin as a percentage of adjusted revenues to over 47% compared with the 1^st half 2014. The reduction in adjusted EBITDA and EBIT compared with a year ago mostly reflects the increase in bareboat charter costs and that the 2014 results included a capital gain.

Other

Activities included are those that do not properly fit into either Marine Services or Subsea Services. Making up the majority of the total are earnings from such items as miscellaneous ship management activities, logistics as well as from the cement carrier Endeavor. The higher revenues in H2 2014 were due primarily to the charter of a vessel to meet client needs prior to the availability of a BOURBON owned and operated vessel.

Net non-current assets increased due to the delivery of vessels that are not part of the vessel sale and bareboat charter agreements. The assets held for sale increased sligthly, albeit from a very low level, reflecting the ongoing fleet management activities of the group.

The significant reduction in gearing ratio (net debt/shareholders equity) is seen when comparing to the end of June 2013, when vessel sale proceeds began to impact net debt. This reduction was significant with a 46% reduction in the ratio from 1.53 to the current level of 0.83 thanks to total  proceeds from the disposal of vessels of $US1.7 billion.

The two primary sources of cash generation for BOURBON are from the vessels in service as a ship operator and the sale of vessels as a ship owner. From these sources of cash, the stakeholders such as banks, government entities and shareholders receive a portion in the form of interest, taxes and dividends. Another use of cash is for investment in assets for the business and required working capital increases. These various uses of cash make the speed of debt reduction less rapid, though still significant.

The free cash flow generated through the combined vessel operator and vessel owner elements of the business has made a significant improvement since the beginning of the vessel sale and bareboat charter program, moving from a negative free cash flow position in H1 2013 to a strong positive free cash flow of close to €130 million at the end of H1 2015. This has enabled BOURBON to reduce its net debt significantly over this period.

OUTLOOK

The drop in the oil price and the uncertainty of the price recovery will continue to affect the development of new deepwater fields and the level of activity in shallow water fields.

BOURBON will continue to adapt to conditions and maintain its focus on cost control. Among the measures taken, BOURBON will continue to temporarily stack certain vessels which have no anticipated activity for 3 months and currently expects that there will be up to 35 supply vessels stacked during the 2^nd half of 2015.

The continued pressure on the industry underscores the need for BOURBON to continue focusing on the four pillars of excellence in service execution, cost reduction, maintaining close contact with customers and their needs (while favoring utilization rates).

Due to high uncertainties in the offshore market and the impact of foreign exchange on its performances, BOURBON is not changing its full year objectives and is still anticipating a stable or slight decrease in adjusted revenues for 2015 and a slight decrease in the margin of adjusted EBITDAR/revenues.

MAJOR OPERATIONS AND HIGHLIGHTS

• As an update to the sale agreement with Minsheng Financial Leasing Co. for the sale and bareboat charter of 8 vessels, the ownership of 3 vessels had been transferred at the end of 2014 for approximately US$57 million. Of the remaining 5 vessels, 2 have been transferred (both Deepwater) during the first half for proceeds of approximately US$54 million, with the remaining 3 vessels to be transferred to MFL during the 2^nd half 2015.

ADDITIONAL INFORMATION

• The accounts for the first half of 2015 were approved by the Board of Directors on the recommendation of the Audit Committee
• The accounts for the first half of 2015 underwent a limited examination by the statutory auditors
• BOURBON's results will continue to be influenced by the €/US$ exchange rate

FINANCIAL CALENDAR

APPENDIX I

Reconciliation of adjusted financial information with the consolidated financial statements

The adjustment items are the effects of the consolidation of joint ventures according to the equity method. At June 30, 2015 and for the comparative periods presented, adjustment elements are:

APPENDIX II

Simplified Consolidated Income Statement

APPENDIX III

Simplified Consolidated Balance Sheet

APPENDIX IV

Simplified Consolidated Cash Flow Statement

APPENDIX V

Quarterly adjusted revenue breakdown

*effect of consolidation of  joint ventures using the equity method.

Quarterly average utilization rates for the BOURBON offshore fleet

Quarterly average daily rates for the BOURBON offshore fleet

Quarterly number of vessels (end of period)

*Vessels operated by BOURBON (including vessels owned or on bareboat charter).

Quarterly deliveries of vessels

Half-year adjusted revenue breakdown

*effect of consolidation of  joint ventures using the equity method.

Half-year average utilization rates for the BOURBON offshore fleet

Half-year average daily rates for the BOURBON offshore fleet

Half-year deliveries of vessels

Contractualization rates for the BOURBON offshore fleet (end of period)

Breakdown of BOURBON adjusted revenues by geographical region

Other key indicators

Quarterly breakdown

Half-yearly breakdown

About BOURBON

Among the market leaders in marine services for offshore oil & gas, BOURBON offers the most demanding oil & gas companies a wide range of marine services, both surface and sub-surface, for offshore oil & gas fields and wind farms. These extensive services rely on a broad range of the latest-generation vessels and the expertise of almost 12,000 skilled employees. Through its 29 operating subsidiaries the group provides local services as close as possible to customers and their operations throughout the world, of the highest standards of service and safety.

BOURBON provides two operating Activities (Marine Services and Subsea Services) and also protects the French coastline for the French Navy.

In 2014, BOURBON'S revenue came to €1,346.4 million and the company operated a fleet of 506 vessels as of June 30, 2015.

Placed by ICB (Industry Classification Benchmark) in the "Oil Services" sector, BOURBON is listed on the Euronext Paris, Compartment A.

Contacts

BOURBON

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james.fraser@bourbon-online.com

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