DOF GROUP ASA DOF Group
Integrated Annual Report 2023
DOF Group
Integrated Annual Report 2023
2023 IN REVIEW
STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS
PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
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10 years of sustainability reporting
Transparent
Our vision and strategic ambitions to create broad stakeholder value are set out in this integrated report. We use the World Economic Forum's four pillars of sustainable development - People, Planet, Prosperity, and Principles to frame our environmental, social and governance (ESG) performance. Within the pillars we bring together the measures of stakeholder value, present non-financial and financial reporting, describe sustainability initiatives, targets and measures for the next strategic period.
Sustainable Development
DOF has reported to the GRI standards, measuring economic, environment, and social aspects since 2014 and has been a Carbon Disclosure Project discloser since 2010. Over this time DOF has engaged with stakeholder groups and improved management and performance in the areas of sustainable development.
Environmental, Social, and Corporate Governance
The ESG (Environmental, Social, and Corporate Governance) fact book in the final section of this report contains extensive detail on our company-wide performance in 2023 and includes future ambitions. This document can be found in digital format on our website: www.dof.com/sustainability.
DOF INTEGRATED ANNUAL REPORT 2023 | 2 |
DOF Group
Integrated Annual Report 2023
2023 IN REVIEW
STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS
PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
-
Interactive PDF
The index and internal navigation menus are clickable. To return to the index page, click the document title in the top left.
Integrated Annual Report 2023
In our report
2023 IN REVIEW
5 Financial performance
6 From the CEO
8 Performance highlights
9 This is DOF
10 How DOF creates value
STRATEGIC AND SUSTAINABLE
12 Our strategic priorities
13 Enterprise risk management: Governance and culture, internal control and risk management system
14 How DOF manages risk and develops opportunities
17 Our approach to sustainable development
DELIVERING ON COMMITMENTS
24 Sustainable finance
25 Maintain ESG leadership
26 Safeguarding our people
27 World-class organisation
28 Expand conventional services:
23 years in Brazil
29 Expand conventional services: DOF in Guyana, est. 2023
30 Grow renewables
PRINCIPLES & GOVERNANCE
- The Executive Management
- The Board of Directors
- Report of the Board
45 Corporate governance
FINANCIAL PERFORMANCE
- Group consolidated financial accounts
- Financial results
- Auditor's report
- Appendix
ESG FACTBOOK
- People
- Planet
- Prosperity
- Principles
- Appendix B
DOF INTEGRATED ANNUAL REPORT 2023 | 3 |
DOF Group
Integrated Annual Report 2023
- 20232023IN REVIEWVIEWIN
Financial performance
STRATEGIC AND
From the CEO
DELIVERING ON
Performance highlights
PRINCIPLES AND
This is DOF
FINANCIAL REPORTS
How DOF creates value
ESG FACT BOOK STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS
PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
DOF INTEGRATED ANNUAL REPORT 2023 | 4 |
DOF Group
Integrated Annual Report 2023
2023 IN REVIEW
-
Financial performance From the CEO Performance highlights This is DOF
How DOF creates value
Financial performance
An overview of our 2023 financial performance
Key figures DOF Group
AMOUNTS IN NOK MILLION | Management reporting | Financial reporting | ||
From the Profit (Loss) | 2023 | 2022 | 2023 | 2022 |
Operating income | 13 365 | 10 702 | 11 929 | 9 257 |
Operating expenses | -8 416 | -6 938 | -7 819 | -6 128 |
Operating profit (loss) before depreciation and write downs - EBITDA | 4 949 | 3 764 | 4 110 | 3 129 |
Depreciation | -1 651 | -1 376 | -1 270 | -1 037 |
Impairment (-)/Reversal of impairment | 1 919 | 655 | 1 919 | 594 |
Operating profit (loss) - EBIT | 5 217 | 3 043 | 4 759 | 2 685 |
Net finance costs | -1 082 | -1 656 | -911 | -1 465 |
Realised and unrealised currency gain/(loss) | 181 | -268 | 174 | -295 |
Net changes in gain/loss on derivatives | - | 9 | - | 9 |
Net financial items | -902 | -1 915 | -737 | -1 751 |
Operational development1
NOK million | |||||||||
14,000 | |||||||||
12,000 | |||||||||
10,000 | |||||||||
8,000 | |||||||||
6,000 | |||||||||
4,000 | |||||||||
2,000 | |||||||||
0 | |||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |
100% | |||
90% | |||
80% | |||
70% | |||
60% | Operating revenue | ||
50% | |||
EBITDA | |||
40% | |||
30% | Operating margin | ||
20% |
10%
0%
STRATEGIC AND SUSTAINABLE
Profit (loss) before taxes | 4 315 | 1 128 | 4 022 | 933 |
Tax income (expenses) | -130 | -275 | 164 | -80 |
Debt development 1
DELIVERING ON COMMITMENTS PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
Profit (loss) for the year | 4 185 | 854 | 4 185 | 854 |
Non-controlling interests | 46 | -11 | 46 | -11 |
From the Balance sheet | ||||
Vessels and other non-current assets | 23 220 | 20 119 | 20 668 | 16 787 |
Current assets | 7 673 | 6 158 | 6 603 | 5 516 |
Total assets | 30 894 | 26 277 | 27 270 | 22 303 |
Interest free debt | 2 662 | 2 686 | 2 354 | 2 391 |
Net financing of the entity | 28 232 | 23 592 | 24 916 | 19 912 |
Interest bearing debt | 17 710 | 23 228 | 14 394 | 19 548 |
Equity | 10 522 | 364 | 10 522 | 364 |
Key Figures
NOK million | |||||||||
30.000 | |||||||||
25.000 | |||||||||
20.000 | |||||||||
15.000 | |||||||||
10.000 | |||||||||
5.000 | |||||||||
0 | |||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |
- %
- %
IBD
20%
NIBD
- %
- %
-
%
0
-5 %
Backlog
Order intake
EBITDA before gain/loss on sale of tangible assets | |
Operating margin | 1) |
Net interest bearing debt | 2) |
Leverage ratio | 3) |
Equity ratio | 4) |
Capex | 5) |
Basic and diluted earnings per share (NOK) | 6) |
Avergage number of shares | 7) |
- EBITDA before gain (loss) on sale of tangible assets/Operating income
- Interest bearing debt minus interest bearing receivables and cash. See note 23
- Net interest bearing debt/EBITDA before gain (loss) on sale of tangible assets
- Booked equity/Total assets
- See note 13
19 770 | 21 104 | 16 667 | 16 277 |
10 100 | 13 100 | 10 100 | 12 730 |
4 872 | 4 033 | 3 694 | 3 058 |
36% | 38% | 31% | 33% |
13 884 | 19 915 | 10 409 | 16 631 |
2.8x | 4.9x | 3.0x | 5.4x |
34% | 1% | 39% | 2% |
2 228 | 1 209 | 1 765 | 674 |
24.64 | 5.46 | 24.64 | 5.46 |
168 021 488 | 158 250 596 | 168 021 488 | 158 250 596 |
- Majority share of profit for the year/Average number of shares. See note 12
- See note 12
The management reporting is based on proportional consolidation of Joint Ventures (JV), See the Group's note 5 about the management reporting.
1 Based on the audited consolidated annual accounts of the former DOF ASA for the period from 2016-2021 and DOF Group ASA for 2022.
Revenue per segment | EBITDA per segment | ||||||
DOF Subsea 70% | DOF Subsea 76% | ||||||
Norskan | 20% | Norskan | 14% | ||||
DOF Rederi | 9% | DOF Rederi | 10% | ||||
Corporate | 3% | Corporate | less than 1% | ||||
All graphs and figures based on management reporting.
DOF INTEGRATED ANNUAL REPORT 2023 | 5 |
DOF Group
Integrated Annual Report 2023
Positioned for the future
2023 IN REVIEW
Financial performance
-
From the CEO Performance highlights This is DOF
How DOF creates value
STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS
PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
From the CEO
2023 has been an eventful year; firstly, a comprehensive financial restructuring of the Group was completed in March, secondly, a public offering and relisting of DOF at the Oslo Stock Exchange was done in June, and thirdly, we have achieved the best result for the Group ever. By end of the year the Group's balance sheet has improved and a strong backlog is secured for 2024. Finally, the DOF share has developed very
positively since the listing, giving value to our shareholders.
We have built a fantastic organisation that is delivering in all areas around the globe. Our business model, leveraging a robust vessel management organisation with a complex subsea project organisation, has enabled us to achieve additional earnings on our own fleet and also on third-party owned vessels.
This healthy growth continued throughout 2023 with high demand for our services and we are well positioned for further growth in 2024.
As always, I am proud to say the professionalism of our team is the foundation for delivering safe,
responsible, and efficient operations.
Financial highlights
The Group achieved a record high EBITDA of NOK 4.9 billion in 2023 (management reporting). There has been
growth across all segments, but the main contribution has been from the subsea segment where we have experienced a significant growth in the activity level together with improved rates and project margins. The Group EBIT of NOK 5.2 billion was also very strong due to reversal of previous impairments
of the Group's assets due to a stronger market. The balance sheet is fixed where the equity ratio has moved from 1% to 34% and an NIBD/EBITDA from 4.9 to 2.8. A strengthening balance sheet is of course the result of the financial restructuring but also the strong result in 2023.
Operational highlights
The markets were positive throughout the year. We experienced high activity in Brazil, North America, and the Atlantic region and during the fourth quarter the markets picked up in the APAC region. Combined with an already strong backlog at the start of the year and good execution, the market increase resulted in record performance from these regions and for the Group. In total, the Group achieved a utilisation rate of 89% in 2023.
The PLSV fleet continued to operate on firm contracts through the year, however the fire on Skandi Buzios has had a major impact on the performance of the PLSV fleet Fortunately no serious injuries happened to the personnel onboard the vessel, but there was a significant damage on the vessel which result in extensive downtime and repairs.
Through the year, the Group has secured several new contracts with a value of approximately USD 1.0 billion, bringing the backlog at year end to USD 1.94 billion. The margins and rates in all contract awards have been done at better terms than the old contracts reflecting a stronger market and will further give a good foundation for delivering good operational performance in 2024.
A few operational highlights in 2023 and so far into 2024 worth mentioning are:
- In the North Sea several contracts have been awarded such as 3-year contracts for both the Skandi Vega and the Skandi Iceman with Equinor, and a 4-year contract for the Skandi Gamma.
DOF INTEGRATED ANNUAL REPORT 2023 | 6 |
DOF Group
Integrated Annual Report 2023
2023 IN REVIEW
Financial performance
-
From the CEO Performance highlights This is DOF
How DOF creates value
STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS
PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
- The Atlantic region was awarded a 18-month contract for the Skandi Acergy with startup in early 2025.
- In Brazil six AHTSs started on new 3- and 4-year contracts and a new PIDF contract was awarded, all contracts are with Petrobras. The new PIDF contract is a continuation of an existing and similar contract demonstrating our clear market leader role in this segment.
- In APAC the contract for the Skandi Hawk was extended until end 2027 and the Skandi Kvitsøy won a 2-year contract in Australia. The latter contract was done at the best terms ever achieved for a PSV owned by the Group.
- Three non-core vessels (PSVs) have been sold and three vessels, Skandi Iceman, Skandi Hera and Skandi Darwin have been acquired at prices significantly below market prices.
- To support the project activity in Brazil and in USA three vessels have been hired for periods of two to three years to support the project activity in Brazil and USA.
- We have won several subsea project contracts in our regions. These projects include Survey, Decommissioning, IRM (Inspection, Repair, and Maintenance), Mooring, and SURF.
Our People
The key to DOF's success remains unchanged - our people. Hiring, developing, and keeping the right people is a key part of maintaining our competitive edge. Our total headcount has a 10% increase compared to 2022, at the end of 2023 there were 4,108 employees in the Group.
Our highest priority, safeguarding our people
Wherever we operate, safety is our priority, and we aim to be an incident-free organisation. In 2023, the Group remains dedicated to enhancing safety and environmental performance across worksites worldwide and we have seen significant improvements in safety indicators and performance.
Creating a safe working environment is a continuous undertaking at DOF. Safety means protecting and empowering our employees and contractors to stop unsafe or inappropriate actions, to report any breach of law or any violation of the DOF Group's policies, or other legal or ethical concerns, without fear of intimidation or reprisal. In 2023, following both industry and company surveys related to harassment, we identified a need to strengthen our focus on our "Speak Up" and "Stop Work" culture and have rolled-out DOF's "Dignity & Respect" campaign focused on identifying, managing, and reporting harassment in the workplace.
UN Sustainable Development Goals and Human Rights
DOF operates in compliance with fundamental labour standards and the UN's Global Compact. In 2023, we partnered with Slave Free Alliance to review our Human Rights exposure and as a result we have robust guidelines to ensure we are doing our best with managing the risks our industry represents.
Sustainable Environment
I am proud to say that 2023 marks DOF's tenth year of sustainability reporting and our efforts have been acknowledged for the 3rd year in a row by Financial Times
- Statista's "Europe's Climate Leaders 2023". We work to reduce our impact on the external environment and support our customers as they move energy production to cleaner solutions. Our commitment to accurate, transparent reporting within world recognised frameworks has driven increased scope and greater maturity in DOF's actions for sustainable environmental management. We see decarbonising DOF's operations is in the interest of stakeholders as well as being critical to value creation now and for the future. Our actions to reduce greenhouse gas emissions and manage environmental impacts are ongoing. We use a combination of technical solutions such as shore power and battery packs, digitalisation, and an organisational approach through environmental management strategy and systems.
Our progress is demonstrated by the 2023 Carbon Disclosure Project (CDP) score of A-, setting DOF among the leaders in our industry.
- We have built a fantastic organisation and are creating more value by utilising this advantage"
Continuous improvement of our operations
Continuous improvement helps to reduce risk, improve performance, and align ways of working. The Group has streamlined, unified and systematised improvement projects under the improvement programme, which is issued annually, although key projects span several years to delivery. Based on thorough planning, improvement projects have been carried out through the Group's value chain, focusing on technology, digitalisation, and improved efficiency. The improvement initiatives continue in 2024.
Outlook
With continuing high tender activity and higher overall activity, we believe that in 2024 we will continue on the same positive trend that we experienced in 2023.
I strongly believe that DOF has a fantastic organisation, a strong business model with a high backlog, and a lot of opportunities going forward. Longer term, and within offshore floating wind, we already have a strong track record. Our focus will be to keep our people safe and deliver value to our stakeholders.
Thank you for your support.
Firstly, thank you to our clients and partners, new and established, for trusting us with your operations around the world.
Finally, thank you to every employee and contractor contributing to our success. Your efforts and professionalism help to keep us safe, deliver on our commitments, and solidify our reputation as a preferred marine and subsea services provider. Throughout 2023 I have been inspired by your dedication and hard work and
- am looking forward to seeing what we can achieve in 2024. Thank you.
Mons S. Aase
Chief Executive Officer
DOF INTEGRATED ANNUAL REPORT 2023 | 7 |
DOF Group
Integrated Annual Report 2023
2023 IN REVIEW
Financial performance
From the CEO
-
Performance highlights This is DOF
How DOF creates value
STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS
PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
Performance highlights
The DOF Group completed the financial restructuring process on the 22 March 2023, creating a stable financial platform for the Group through a substantial conversion of debt to equity. After completing its public offering, DOF Group re-listed on Oslo Børs.
BUILDING BACKLOG
Minimum 3 vessels | ||
Skandi Acergy | Skandi Vega | + PIDF Subsea Services |
SURF contract | Client: EquinorEnergyAS | Client: Petrobras |
Est. Revenue: | UK Sector | Duration: est. 2 years |
USD 80-100 m | Duration: 3-year | Est. Revenue: USD 260m |
Skandi Ipanema | Skandi Iceman | Skandi Acergy |
Client: Petrobras | Client: EquinorEnergyAS | Client: Subsea7, |
Duration: 4-year | North Sea | UK Sector |
Est. Revenue: | Duration: 3-year | Duration: 18-month |
USD 51 m | Est. Revenue: | |
USD 85-105 m |
BOOK TO BILL
Q1 '21 to Q4 '23
NEW ADDITIONS TO THE FLEET
3 | |||
Vessels | |||
purchased | Skandi Hera | Skandi Darwin | Skandi Iceman |
(options exercised for) | |||
AHTS | Subsea | AHTS | |
All prices significantly | |||
below market values. | |||
DOF was selected by the | |||
vessel's new owners to | |||
be commercial and | |||
technical managers. Both | |||
Vessels on | vessels support DOF's | Skandi Mercury | |
2 | conventional and | Skandi Jupiter | |
management | renewables projects in | AHTS | |
the North Sea | AHTS | ||
3 | Stril Explorer | Maersk Installer | Connor Bordelon, |
Contract: 3-year | Contract: 2-year firm | Jones Act vessel | |
+4x1options | Serves increased | Contract: 1+1-year | |
Vessels | Supports PIDF | demand in the subsea | contract supports |
chartered-in | contract | project segment | activity in gulf |
complement the | in Brazil | (commenced | |
March 2024) | |||
DOF fleet | |||
DOF INTEGRATED ANNUAL REPORT 2023 | 8 |
DOF Group
Integrated Annual Report 2023
This is DOF
2023 IN REVIEW
Financial performance
From the CEO
Performance highlights
-
This is DOF
How DOF creates value
STRATEGIC AND SUSTAINABLE
No matter where DOF operates in the world, safety is held as the highest priority.
DOF is a leading provider of integrated subsea and marine services to the global offshore| energy market. Established in Austevoll in 1981, DOF has continued a proud tradition of delivering safe and quality services to our customers.
BERGEN | |
AUSTEVOLL (HQ) | |
ABERDEEN | |
ST. JOHN'S | ATLANTIC REGION |
NORTH AMERICA REGION
HOUSTON
GEORGETOWN
SEOUL
MANILA
SINGAPORE
DELIVERING ON COMMITMENTS PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE
ESG FACTBOOK
EU TAXONOMY REPORT 2023
USD | LUANDA |
1.94 | RIO DE JANEIRO |
MACAÉ | |
billion | |
backlog as of Q4'23 | BUENOS AIRES |
SOUTH AMERICA REGION
571 | 6 | |
vessels | operating | |
in fleet | continents | |
4,108 | Norway | +40 |
years | ||
employees | headquartered | operational history |
ASIA-PACIFIC REGION
PERTH
1827 | ||||||
22 | 22 | |||||
1061 | ||||||
897 | ||||||
323 | 6 | 7 | ||||
North | Asia | Atlantic South | North | Asia | Atlantic | South |
America | Pacific | America | America | Pacific | America | |
Employees per region | Vessel per region |
¹45 owned vessels, 5 vessels hired in and 7 vessels under management | DOF INTEGRATED ANNUAL REPORT 2023 | 9 |
DOF Group
Integrated Annual Report 2023
2023 IN REVIEW
Financial performance
From the CEO
Creating value for our stakeholders
Integrated subsea and marine services to global offshore energy producers is the core value generating work of our business. We operate in a rapidly evolving market, where meeting changing stakeholder demands and supporting changes to the energy mix are central to our strategy and future value creation.
How DOF creates value
- We aspire to be a trusted and leading partner delivering integrated subsea and marine services globally
for a sustainable utilisation of offshore energy and other subsea resources."
Performance highlights
This is DOF
- How DOF creates value
STRATEGIC AND SUSTAINABLE
DELIVERING ON COMMITMENTS PRINCIPLES & GOVERNANCE
FINANCIAL PERFORMANCE ESG FACTBOOK
EU TAXONOMY REPORT 2023
INPUTS
We rely on:
The expertise of our diverse, talented and dedicated team.
Strong customer relationships and partnerships, always offering the business services and technologies to match and support our customer's evolving requirements.
A supply-chain network capable of supporting DOF's strategic, ESG and operational goals.
Over 20 strategically located offices, operational yards and logistics bases.
INTEGRATED PROJECT DELIVERY TO MEET GLOBAL ENERGY DEMAND
Construction fleet and | Diving | ROVs | ||||||||
subsea assets | ||||||||||
MARINE MANAGEMENT | SPECIALIST FLEET | PROJECT MANAGEMENT | ||||||||
AHTS & PSV fleet | Survey and Inspection | Engineering | ||||||||
OUTPUTS
We deliver:
A company that values its PEOPLE. A safe, diverse and inspiring, inclusive workplace.
Reduced impact on the PLANET. Progressing DOF's Decarbonisation plan reduces our impact on the external environment. We support our customers as they move energy production
to cleaner solutions.
Natural resources to operate: energy in fuel and electricity and other materials, metals and minerals.
A robust financial platform: visible backlog and sustainable capital returns.
Our reputation for quality, reliability, and trusted offshore project delivery.
Technology to digitalise our operations, optimise energy efficiency and reduce energy consumption.
Conventional
DOF has over 40 years experience
building and managing a world-class,purpose-built fleet. Our new build, conversion and operational teams manage and deliver all aspects of fleet build, certification, and maintenance activities.
Retained knowledge and experience transfer: frontrunners in fleet technical management and maintenance. Dedicated core crews underpins safe operations.
PROVIDING OUR PARTNERS
WITH COMPREHENSIVE SOLUTIONS
FOR EVOLVING OFFSHORE OPERATIONS
Diverse and interchangeable: DOF's fleet is purpose built and chartered-into match the challenges of the offshore sector and for a wide-rangeof operations, water depths and environmental conditions.
Regional and global fleet: regionally based vessels in a global fleet provide flexibility and capability where vessels can be re-engineered in-houseto meet specific work-scopes.
Renewable
Seamless end-to-end project delivery: Project Management offers clients a single access point to all project resources and assets, including design and subsea engineering, vessels, and marine management.
Interchangeable capability, expertise and assets: offer customers comprehensive solutions for conventional and renewables offshore operations, ensuring projects run safely, smoothly and to schedule.
Sustainability for shared PROSPERITY. Lasting value for stakeholders, a long-term competitive return on the investment, and build renewable energy revenue streams.
PRINCIPLESthat foster value. We create governance systems and controls to support safe, legal and ethical operations wherever we do business.
DOF INTEGRATED ANNUAL REPORT 2023 10
How DOF creates value
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DOF ASA published this content on 22 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 April 2024 13:17:01 UTC.
