Seaway 7 ASA Announces Fourth Quarter and Full Year 2021 Results

Oslo - 3 March 2022 - Seaway 7 ASA (Euronext Growth: SEAW7) announced today
results for the fourth quarter and full year which ended 31 December 2021.
Unless otherwise stated the comparative period is the full year which ended 31
December 2020.

Fourth Quarter and Full Year 2021 highlights
o Completion on 1 October 2021 of business combination between OHT ASA and the
Subsea 7 S.A. Group's fixed offshore wind business to create Seaway 7 ASA
o Fourth quarter 2021 revenue up 40% year-on-year to $326 million 
o Fourth quarter adjusted EBITDA of $30 million equating to a margin of 9%
o Order intake in the fourth quarter of $259 million, equating to a fourth
quarter book-to-bill ratio of 0.8, resulting in a backlog of $1,238 million at
year end

For the period (in $             Fourth Quarter	          Full Year
millions, except 
Adjusted EBITDA margin       Q4 2021      Q4 2020       2021      2020
and per share data)        Unaudited    Unaudited    Audited   Audited          
                      
----------------------------------------------------------------------
Revenue	                         326	      234      1,260       631
Adjusted EBITDA(a)	          30	       11	  24	    12
Adjusted EBITDA margin(a)	  9%	       5%	  2%        2%
Net operating income/(loss)	   8	       (2)       (39)      (40)
Net income/(loss)	           7	       (4)       (63)      (50)
		
Earnings per share - in $ per share 
Basic	                        0.02	    (0.01)     (0.18)    (0.16)
Diluted(b)	                0.02	    (0.01)     (0.18)    (0.16)
-----------------------------------------------------------------------
				
	                            	                2021       2020
At (in $ millions)                                    31 Dec     31 Dec
-----------------------------------------------------------------------
Backlog(c)                                             1,238      1,987
Book-to-bill ratio - full year(c)			 0.3	    3.1
Cash and cash equivalents 	                          22	      8
Borrowings			                        (101)	    (35) 
Net debt excluding lease liabilities(d)			 (79)       (27)
Net debt including lease liabilities(d)			(106)	    (36)
------------------------------------------------------------------------
(a) For explanations and reconciliations of Adjusted EBITDA and Adjusted EBITDA
margin refer to Note 8 'Adjusted EBITDA and Adjusted EBITDA margin' to the
Condensed Consolidated Financial Statements. 
(b) For the explanation and a reconciliation of diluted earnings per share refer
to Note 7 'Earnings per share' to the Condensed Consolidated Financial
Statements.
(c) Backlog is a non-IFRS measure. Book-to-bill ratio represents total order
intake divided by revenue recognised in the year.
(d) Net debt is a non-IFRS measure and is defined as cash and cash equivalents
less borrowings. 

Basis of preparation of results
The business combination between OHT ASA (renamed Seaway 7 ASA) and the Subsea 7
S.A. Group's Renewables business unit was completed on 1 October 2021. For
accounting and reporting purposes, the Subsea 7 S.A. Group's Renewables business
unit was deemed to be the accounting acquirer. The business combination
qualifies as a reverse acquisition, with the legal acquirer and legal parent
being OHT ASA (renamed Seaway 7 ASA). The Condensed Consolidated Financial
Statements of Seaway 7 Group (the Group) are presented as follows: 
o For the nine-month period ended 30 September 2021 and for the year ended 31
December 2020 ('the carve-out periods'), financial information represents the
results and financial position of the Subsea 7 S.A. Group's Renewables business
unit; 
o For the three-month period ended 31 December 2021, financial information
represents the Consolidated Financial Statements of Seaway 7 ASA and its
subsidiaries.

Further details are disclosed in Note 2 'Basis of preparation' to the Condensed
Consolidated Financial Statements.

Stuart Fitzgerald, Chief Executive Officer, said:
The formation of Seaway 7 ASA created a market leader in fixed offshore wind,
with exposure across multiple segments in the value chain, a comprehensive fleet
and experienced management team. Seaway 7's position in this growing market is
built on a long history as one of the market leaders within offshore energy and
marine Contracting, and more than a decade of track record within the fixed
offshore wind sector.

In a year of high operational activity and associated revenue, and good progress
across much of the portfolio, the Seaway 7 operational and financial performance
for the full year in 2021 was impacted by the ongoing challenges posed by the
Covid-19 pandemic, and worksite conditions which adversely impacted certain
projects in Taiwan. 

Full year 2021 
In the full year ended 31 December 2021, the Group's revenue increased 100% to
$1.3 billion, while Adjusted EBITDA margin remained at 2%. Revenue doubled as
activity on the Seagreen project increased, but margins remained low due to
challenges in Taiwan. Overall, the Group's EBITDA increased 110% to $24 million
mainly due to the increased activities on the Seagreen project and the heavy
transportation business included in the business combination in Q4 2021.
Adjusted EBITDA margin was 2%, in line with the prior year.  After a tax charge
of $14 million, equating to an effective tax rate of 29%, the net loss for the
year was $63 million, a deterioration from a net loss of $50 million in 2020.

During the year, net cash generated from operations was $39 million which
included favourable movements of $23 million related to working capital despite
Covid-19 challenges and delays, as well as the timing of milestone payments on
certain projects. Capital expenditure increased and is mainly driven by payments
on Seaway Ventus, Seaway Alfa Lift and operating equipment, financed through a
short-term loan from the Group's ultimate parent undertaking, Subsea 7 S.A.
Group.

New order intake was $259 million and included the Dogger Bank C, Borkum
Riffgrund 3 and Gode Wind 3 project, the Zhong Neng project and escalations on
other projects.

Fourth quarter operational review 
The fourth quarter saw a continuation of good operational progress in the
fabrication and installation phase on the Seagreen project.  Over 60 jackets
were delivered despite Covid-19 challenges from fabrication yards in China and
the Middle East. By year end, 10 jackets were installed and delivery of the
remaining 115 jackets and 327 kilometres of cables to the marshalling yard in
Scotland remains on schedule.

Seaway Strashnov worked installing monopiles on the Hollandse Kust Zuid project
in the Netherlands early in the quarter, before demobilising for the winter
break and preparations for a busy 2022 campaign. Seaway Yudin underwent planned
vessel maintenance in Indonesia during the quarter, as well as preparations for
re-mobilisation onto the Formosa 2 project in Taiwan early 2022. Seaway Aimery
and Seaway Moxie were active on the Hornsea II and Seagreen projects in the UK. 
During the quarter, the Group commenced a charter of Maersk Connector which
completed a number of cable installations on the Seagreen project and is now
being deployed to Asia to support Taiwan project activity during 2022. On the
Yunlin project in Taiwan, cable laying continued with Seaway Phoenix.

The heavy transportation vessels maintained their high levels of utilisation and
we saw an improvement in the time charter equivalent day rates in the quarter.

As we entered the winter season in the northern hemisphere, utilisation of the
active fleet was 80% in the quarter, down from 99% in the third quarter but up
slightly from 78% in the prior year period.

The development of Seaway Alfa Lift foundation installation vessel continued
through 2021 with commissioning of marine systems progressing as expected. The
vessel departed for sea trials in early January 2022.

On 18 October 2021, an incident occurred with the A-frame on the 3,000t Liebherr
crane. The A-frame has been removed from the vessel, inspected, and is now under
repair at the yard. Crane repairs are expected to be complete in the second half
of 2022. As a result of key supplier delays, the final installation, testing and
commissioning of the mission equipment for the upending and lowering of
monopiles is expected to represent the critical path to vessel delivery and
readiness for operations. We do not expect the vessel will be operational on
projects during 2022 and planned start of operations is now during Q1 2023. A
contingency scenario has been activated which utilises Seaway Strashnov to
progress the committed work on the Dogger Bank A&B project in the second half of
2022.

The shipbuilding contract for Seaway Ventus, the Group's first wind turbine
installation vessel continues in the detailed design phase, all main equipment
has been selected and first steel cutting occurred in November 2021. Delivery is
scheduled for mid-2023 with the vessel anticipated to start in the first half of
2024 on the Borkum Riffgrund 3 and Gode Wind 3 project in Germany.

Fourth quarter financial review
Fourth quarter revenue of $326 million increased by 40% compared to the prior
year period, reflecting higher activity on the Seagreen project, UK. Adjusted
EBITDA margin increased to 9.2% from 4.8%. After depreciation and amortisation
of $22 million, the Group recorded net operating income of $8 million. Net
income for the quarter was $7 million, after a tax charge of $3 million equating
to an effective tax rate of 30%.  

During the quarter, net cash used in operating activities was $24 million which
was impacted by delayed client payments linked to commercial discussions in
relation to Covid-19 challenges and delays in Taiwan. Capital expenditure was
$29 million, cash acquired as a result of the business combination was $12
million, a short-term loan of $64 million from the Group's ultimate parent
undertaking, Subsea 7 S.A. Group, was recognised and payments related to lease
liabilities were $5 million. Cash and cash equivalents increased by $16 million
since 30 September 2021 to $22 million by the end of the quarter.

Under the contingent scenario for Dogger Bank A&B, we expect to deploy Seaway
Strashnov from Q3 2022 to execute the initial phase of the project. The change
of vessel comes with additional cost, and as a result, the Group has recognised
an onerous contract provision in the fourth quarter 2021. This has been
recognised as a fair value adjustment related to the combination as detailed in
Note 9 to the Condensed Consolidated Financial Statements 'Goodwill'.  

In the fourth quarter, the Group recognised new orders of $226 million and
escalations of approximately $33 million, resulting in a book-to-bill ratio of
0.8. The backlog at year-end was $1,238 million of which $882 million is
expected to be executed during 2022 and $356 million in 2023 and thereafter.

Outlook for the full year 2022
Delays in UK Government's Contracts for Difference (CFD) rounds in 2021 impacted
the timing of a number of awards to market through the year. However, ongoing
tendering activity is significant for projects expected to be awarded to the
industry in 2022, primarily for projects in UK, Europe and the US. With an
enhanced fleet of foundation, cable and turbine installation vessels, Seaway 7
ASA is well-positioned to capture a fair share of this long-term, high-growth
market. Absent any renewed deterioration in the impact of the pandemic, we
expect that 2022 revenue will approach $1 billion, that the Adjusted EBITDA
margin will improve towards 10% and that net operating income will be positive. 

Longer-term outlook and strategic positioning 
Market fundamentals within fixed offshore wind continue to strengthen, and
during the last six months of 2021, we have experienced a significant increase
in tender activity and client engagements in relation to future projects. This
growth is primarily in Europe and the US. The strong growth in market prospects
is seen from 2024 and particularly 2025 onwards. The increasing lead-times of
client bidding activity demonstrates the priority towards securing both
installation assets and competent contractor project teams, in what is expected
to be a supply constrained market in this timeframe. 

Clients are showing increased interest in both integrated and EPCI projects
where we provide services across multiple segments and internalise certain
interfaces on behalf of the client. This reduces both Seaway 7 and client risk
and allows for accelerated execution plans. As supply chains globalize this
integration increasingly includes heavy transportation, which represents a
further unique positioning for Seaway 7. The single party offering simplifies
the contract structure and administration, and reduces the client's resource
requirements on the projects. This is a client decision driver as their
resources become more constrained with increasing activity levels. Seaway 7 is
well positioned in this context both through its differentiated asset and broad
segment coverage, and our people and their ability to manage complex projects in
marine environments.

Special Note Regarding Forward-Looking Statements 
Forward-Looking Statements: This announcement may contain 'forward-looking
statements'. These statements relate to our current expectations, beliefs,
intentions, assumptions or strategies regarding the future and are subject to
known and unknown risks that could cause actual results, performance or events
to differ materially from those expressed or implied in these statements.
Forward-looking statements may be identified by the use of words such as
'anticipate', 'believe', 'estimate', 'expect', 'future', 'goal', 'intend',
'likely' 'may', 'plan', 'project', 'seek', 'should', 'strategy' 'will', and
similar expressions. The principal risks which could affect future operations of
the Group are described in the 'Risk' section of the Group's Annual Report.
Factors that may cause actual and future results and trends to differ materially
from our forward-looking statements include (but are not limited to): (i) our
ability to deliver fixed price projects in accordance with client expectations
and within the parameters of our bids, and to avoid cost overruns; (ii) our
ability to collect receivables, negotiate variation orders and collect the
related revenue; (iii) our ability to recover costs on significant projects;(iv)
unanticipated delays or cancellation of projects included in our backlog; (v)
competition and price fluctuations in the markets and businesses in which we
operate; (vi) the loss of, or deterioration in our relationship with, any
significant clients; (vii) the outcome of legal proceedings or governmental
inquiries; (viii) uncertainties inherent in operating internationally, including
economic, political and social instability, boycotts or embargoes, labour
unrest, changes in foreign governmental regulations, corruption and currency
fluctuations; (ix) the effects of a pandemic or epidemic or a natural disaster;
(x) changes in, or our failure to comply with, applicable laws and regulations
(including regulatory measures addressing climate change); (xi) operating
hazards, including spills, environmental damage, personal or property damage and
business interruptions caused by adverse weather; (xii) equipment or mechanical
failures, which could increase costs, impair revenue and result in penalties for
failure to meet project completion requirements; (xiii) the timely delivery of
vessels on order and the timely completion of ship conversion programmes; (xiv)
our ability to keep pace with technological changes and the impact of potential
information technology, cyber security or data security breaches; and (xv) the
effectiveness of our disclosure controls and procedures and internal control
over financial reporting. Many of these factors are beyond our ability to
control or predict. Given these uncertainties, you should not place undue
reliance on the forward-looking statements. Each forward-looking statement
speaks only as of the date of this announcement. We undertake no obligation to
update publicly or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.


Webcast and conference call information:

Date:                         3 March 2022
Time:                            14:30 CET

Please join the webcast through
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The webcast will also be available through Seaway 7 website
https://www.seaway7.com/investors/results-reports-publications/

Conference call details

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For further information, please contact:
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