1. business and industrial

Caverton Offshore Support Group
Facts Behind the Listing Presentation 20th May 2014
A Leading Indigenous Aviation & Marine Logistics Service Provider
May, 2015
Important Notice
This presentation includes forward-looking statements. Forward-looking statements include all matters that are not historical facts and include, by way of example,
statements concerning our plans, objectives, goals, strategies, future events, future performance, capital expenditures, financing needs and business trends. In some
cases, these forward-looking statements can be identified by words such as “aims”, “believes”, “estimates”, “anticipates”, “expects”, “intends”, “may”, “will”, “plans”,
“continue” or “should” and similar expressions but these words are not the exclusive means of identifying such statements. These forward-looking statements may appear
in a number of places throughout this presentation. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our
control that could cause actual results to differ materially from the results discussed in the forward-looking statements. You should not place undue reliance on these
forward-looking statements. Any forward-looking statements are based upon information available to us on the date of this presentation and we do not intend, and do not
assume any obligation, to update forward-looking statements set forth in this presentation. Many factors may cause our results of operations, financial condition, liquidity,
dividend policy and the development of the industry in which we compete to differ materially from those expressed or implied by the forward-looking statements contained
in this presentation. This presentation does not purport to describe all risks and factors that could adversely affect our results of operations, financial condition, liquidity
and dividend policy and our development plans, including those which in the future may be attributable to the Nigerian maritime and aviation industries or to an investment
in an emerging market. Moreover, new risks can emerge from time to time, and it is not possible for us to predict all such risks, nor can we assess the impact of all such
risks on our business or the extent to which any risks, or combination of risks and other factors, may cause actual results to differ materially from those contained in any
forward-looking statements. Given these risks and uncertainties, you should not rely on forward-looking statements as a prediction of actual results. No information
included in this presentation is intended to be a profit forecast or a financial projection or prediction. No representations or warranties, express or implied, are given as to
the achievement or reasonableness of, and no reliance should be placed on, statements pertaining to financial performance, including (but not limited to) any estimates,
forecasts or targets contained herein. You are cautioned not to rely on such statements. The achievability of the Company’s proposed strategy set out in this presentation
cannot be guaranteed. Except as otherwise indicated, statements contained in this presentation are only as of the date hereof. In no circumstances shall the distribution of
the information contained in this presentation create any implication that there has been no change in the affairs of the Company after the date hereof. The Company
gives no undertaking to provide the recipient with access to any additional information or to update this presentation or any additional information or to correct any
inaccuracies in it which may become apparent. The information in this presentation, which does not purport to be comprehensive, has been prepared in good faith and has
not been independently verified. No representation or warranty by the Company, express or implied, is or will be made and no responsibility or liability is or will be
accepted by the Company or any of its officers, employees or agents as to or in relation to the accuracy or completeness of this presentation and any such liability is
expressly disclaimed.
Company Overview – Key Milestones
 Commenced operations with Caverton Marine and
subsequently Caverton Helicopters 3years after
1999
2003
 Acquired 5 helicopters and
1st
fixed wing craft
2006
2007
 $133m Capital raise via a private placement
 Won a 3-year contract from Total Upstream
 Won a 4-year contract Shell Petroleum
Development Company
 Awarded 2 yr contract extension by Shell
 Signed new air charter contract with NNPC
 Chartered 1 LPG storage vessel
 Acquired 2nd fixed wing craft
 Commissioned 3rd operating base, Port Harcourt
2008
2010
 Won a 3-year contract (+2 yr. option) from Total
Exploration
 CM Signed JV agreement with RK offshore Ltd
 Commissioned 1st hangar and obtained 1st in-town
helicopter license
 CHL was awarded a $630m 5-year contract with Shell
Petroleum the largest contract size ever awarded to an
indigenous company.
2011
2012
 Won a 5-year (2 x 2 yr. option) contract from Cameroon
Oil Transportation Company (a subsidiary of Exxon
Mobil)
2014
 Marine operations upgraded to “AA” by Nigerian
Content Development Board (NCDMB)
 Listing by introduction on the Nigerian Stock Exchange
(NSE)
2013
2015
2
Management Team
Mr. Adeniyi Makanjuola
Chief Operating Officer
Mr. Samuel Ileoma
Chief Financial Officer
Capt. Josiah Choms
MD Caverton Helicopters
Olabode Makanjuola
MD/CEO
Mr. Tolu Osunsanya
Ag. MD Caverton Marine
Mr. Robbert Strating
Director, Operations
Mr. Kingsley Uwagbale
Director, Strategy & Planning
Mrs.Titilola Adigun
Deputy Chief Financial Officer
Mrs. Joy Okebalama
GM, External Relations
3
Ownership Structure
Caverton Offshore Support Group (COSG)
Tasmania Investments Ltd
15%
Aderemi Makanjuola
1%
1%
2%
3%
Molar Vessels Supplies Ltd
UBAPC/Anchor Pension Managers
9%
54%
Olabode Makanjuola
Adeniyi Makanjuola
15%
CHL
Ibile Holdings
Others
Caverton Offshore Support Group
Mr Aderemi Makanjuola
1%
99%
CML
Caverton Offshore Support Group
Mr Aderemi Makanjuola
1%
99%
4
Company Overview – Current Asset Base
Aircraft
9x
3x
Vessel
AgustaWestland AW139:
 15 seater; Large passenger cabin
 High speed
 Powered by two pratt & whitney PT6C-67C
turboshaft engines
Bell Helicopters 412 EP:
11 seater
Twin turbine
Advanced technology design
For on-site and off-shore logistic services
Vessel - LIV K
•Accommodates up to 42 personnel
•Deadweight of 1380mt
•Vessel is DP 1 and fitted with a FIFI Class 1 System
Facilities
2x
3x
DHC6-400 & DHC6-300 Twin Otter:
 Twin engine
 20-passenger STOL utility aircraft
 150-300km/hr speed range
S-76C Sikorsky Series :
12 seater
Technologically advanced; Powerful
engines
High level safety features
•Lagos Heliport, Victoria Island
•Located at centre of business
metropolis
•Transit point for business and
offshore travelers
•Only licensed heliport in Lagos
•Port Harcourt Hangar Facility
•Located at NAF Base
•1200sqm
•9 bay hangar with workshops
•Lagos Hangar Facility
•Located at Murtala Muhammad
International Airport
•1250sqm
•Offers specialized maintenance and
repair
5
Our Promise to Clients
Our “aim 4 zero” campaign is guiding
principle at the core of our operations.
We aim for zero accidents and
downtime to enhance our value add to
our clients operations
To achieve this, we have established a
culture of management ownership &
accountability of safety throughout our
organisation.
In the current challenging environment,
it is imperative to help maximise our
clients profitability by lowering their
offshore operating costs through
improved productivity with our
services.
The effectiveness of our safety culture
is evidenced in our history; we have
had zero accidents and incidences
despite our growth. This highlights the
attractiveness of our value proposition
in an industry where Safety comes first.
“Reducing Risk - Improving Safety - Increasing Efficiency”
6
II. Macro Dynamics
7
Oil prices still well within operational levels
Cash costs with and without royalty effects, $/bbl vs. cumulative global liquids production ,mmb/d
Source: Morgan Stanley
8
Global Offshore Capex Share by region
Australasia
Latin America
Asia
Europe
9%
11%
Africa
North America
MiddleEast & Caspian Sea
5%
22%
15%
21%
17%
“Deep water expenditure in Africa forecasted to rise 69% between 2015 and 2019 according to
”
Douglas Westwood Research
Source:Infield Systems Ltd
Oil & Gas production trends – Deep water rising...
Source: Douglas Westwood
10
Continuous investment by major E & P’s
Source: Chevron Supplement to Annual Report 2014
11
II. Financial Overview
12
FIXED MONTHLY CHARGE
+
VARIABLE HOURLY CHARGE
REVENUE
FIXED MONTHLY HIRE RATE
AGENCY
CONTRACTS
CONTRACTS
CML
CHL
REVENUE
AD HOC CHARTERS
Strong business model based on a two tiered
revenue structure
REVENUE
HOURLY RATE
X
NUMBER OF HOURS FLOWN
REVENUE
RATE PER DISCHARGE
VOLUME
13
Q1 2015 – Operational Highlights
Number of Flight Hours

1,600.00
2014
Signed 2 new contracts in the quarter
2015
-
A helicopter contract with NNPC to service all
offshore platforms operated by the Nigerian
Petroleum Development Company(NPDC)
-
Folawiyo Aje Services Limited to provide
offshore support logistics in support of Aje
Phase 1 development drilling activities.
1,400.00
1,200.00
1,000.00
800.00

Successful extension of ongoing contract
with Shell for two additional years
600.00
-
400.00
This highlights our expertise in delivering quality
and efficient services and ability to retain our
clients.
200.00
Jan
Feb
Mar
14
Q1 2015 – Improving Margins
Three months to March
Revenue
Direct Operating Costs
Gross Profit
Administrative expenses
31 MARCH 2015
N'000
31 MARCH 2014
N'000
%
Change
5,964,239
5,609,265
6%
(3,630,074)
(3,434,282)
6%
2,334,165
2,174,983
7%
(1,694,075)
(1,606,904)
5%
Other operating income/(expense)
(11,696)
5,874
-299%
Operating Profit
628,393
573,953
9%
(425,412)
-
(306,450)
39%
Profit before income tax expense
202,981
267,502
-24%
Income tax expense
(94,742)
(162,782)
-42%
Profit for the period
108,238
104,720
3%
Finance cost
Basic Earnings per share (N)
Number of Shares in issue
0.032
0.031
3,350,510,000
3,350,510,000
CML accounted for 12% of
group revenues, up from 10%
in the same period last year
Group revenue driven by
increased flight activity on
ongoing fixed helicopter
contracts; revenue from this
segment up 17% yoy.
Ad hoc charter market was
softer in the period, a
reflection pre election
business slowdown.
EBITDA Margin at c.20% vs.
17% in Q1 2014
15
Revenue by Segment - Q1 2015 VS. Q1 2014
Q1 2015
Q1 2014
Ad hoc charter
Ad hoc charter
2%
Helicopter maintenance
11%
10%
9%
0%
Helicopter maintenance
0%
17%
2%
Airplane contract
Airplane contract
Agency service income
78%
Agency service income
71%
Time charter services
income
Time charter services income
16
Q1 2015 – Improving leverage position
31 MARCH 2015
31 MARCH 2014
N'000
N'000
Non current assets
24,174,171.86
23,876,691.54
Current assets
15,541,193.39
17,060,276.20
Total assets
39,715,365.25
40,936,967.74
Equity
12,039,836.86
11,484,779.96
Non Current Liabilities
15,241,279.27
20,664,365.92
Current Liabilities
12,434,248.97
8,787,822.53
Total Equity and Liabilities
39,715,365.10
40,936,968.40
Cash
4,004,875.55
1,895,989.88
Short term debt
1,324,618.41
752,008.41
Long term debt
14,768,362.01
20,108,546.47
Net debt
12,088,104.87
18,964,565.00
Net Debt / EBITDA of 10.2x vs. 19.9x(Q1
2014).
Asset turnover ratio improving to c.15%
vs. 13.8%
Debt to total capitalisation 57.2%
vs.64.5% in Q1 2014
17
Q1 2015 – Stronger Cash Flow
Profit before tax
31 MARCH 2015
31 MARCH 2014
%
N'000
N'000
Change
202,981
201,872
1%
2,001,913
(327,097)
712%
Net cash flows from/(used in) investing activities
(31,907)
(40,810)
-22%
Net cash flows from/(used in) financing activities
(37,809)
860,905
-104%
Net increase/(decrease) in cash and cash equivalents
1,932,197
492,998
292%
Cash and cash equivalents at 1 January
1,813,640
1,201,368
51%
Cash and cash equivalents at 31 March
3,745,837
1,694,366
121%
Net cash flows from operating activities
Operating Cash Flow to
Sales at 34%
18
Significant Capital Expenditures – 2015/2016

Planned capex is primarily to finance
the following:
•
Construction of the first commercial Aviation
and Training Centre (ATC) in Africa.
•
Construction of a Maintenance, Repair &
Overhaul (MRO) centre to service Western
and Central African operators

Signed contract with best in class
technical partners and contractors for
construction .

Projects to be primarily financed with
Naira loans by accessing the Power
Aviation and Intervention Fund (PAIF).
3%
50%
6%
2%
c.$30mln
39%
Pre Fab Construction
Land
Engineering Works
Simulators
Spares & Supplies
19
Robust growth opportunities

Significant rise in demand for offshore support vessels as new discoveries in West
Africa emerge. This is in line with our plans to upgrade our asset base in the marine
business.

Increasing offshore activity as onshore fields mature and production shifts offshore
due to onshore insecurity threats locally.
-
West Africa remains the key driver of offshore capex growth in Africa; accounting for over 80% of the
regions capex.1

Additional revenue streams from training centre and maintenance operations.

Expansion into other West African markets to leverage expertise with proven track
record. (Cameroon, Ghana)
1 Douglas
Westwood Research
20
Corporate Governance remains a priority

Revamped organisational structure with clear roles and functions designed to
achieve effective management of our growing business portfolio.

Concluded the migration and implementation of SAP Business One package in
February 2015; this will improve transparency of our accounting and reporting.

Introduction of independent and experienced members to the Board and Board
committees.

Creation of an Internal Control Department with direct access to the Board and
Board committees.
21
Existing Contract Status
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Jun 2010
5 yr contract with a 2 yr extension option (which has already been exercised)
Mar 2011
3 year with 2yr extension which has already been
exercised
Helicopters
Early 2012
2 year option
5 year contract
2 year option
Aug 2013
3 year contract
Aug 2013
4 year contract
May 2015
2 year contract
July 2015
Marine
Folawiyo Aje
6 months with
extension
option
3 month rolling contract
22
Thank You
Q&A
23
Appendix: Tender Pipeline
Marine Operations
TENDER STAGE
TYPE OF VESSEL
DURATION
STATUS
Technical Stage
PROPOSED
COMMENCEMENT DATE
TBA
2 x Crew Boats
TBA
Ongoing
Technical Stage
Q3, 2015
Platform Supply Vessel(1)
+ Tug boats
2+5
Ongoing
Technical Stage
Q4, 2015
LPG Carrier
5+2+2+1
ITT received
NO. OF HELICOPTERS
DURATION
Technical Stage
PROPOSED COMMENCEMENT
DATE
Q4, 2015
Rotary wing (3)
5
Ongoing
Technical Stage
Q4, 2015
Rotary wing (3)
5
Ongoing
Commercial Stage
Q3, 2015
Rotary wing(5)
NS
Submitted
Prequalification Stage
Q3, 2015
NS
Ongoing
Technical /Commercial
Proposal
Q4, 2015
Helicopters(2)
wing(1)
Helicopter (1)
NS
Ongoing
Technical Stage
Q3, 2015
Fixed Wing (1-private Jet)
Helicopter Operations
TENDER STAGE
Fixed
5
TENDER STATUS
Submitted
24
Appendix: Historical Charts
Number of Aircrafts2
EBITDA & EBITDA Margin
25
7
22
20
6.00
6
18
17
30%
3
8
2
25%
2.7
2.4
1.5
20%
15%
1.5
10%
1
2
5%
2
0
0
08A
2008
2009
2010
Number of contracts won
2011
2012
2013
1
1
1
NGN Millions
2
0.5
0
2011
2012
2013
2014
450
400
350
300
250
200
150
100
50
0
13A
14A
EBITDA Margin (RHS)
418
251
Contracts won include 2010: Shell, PPMC; 2011: Total; 2012: Addax, COTCO; 2013: Shell, Total, Nimasa 2014: NNPC
2012-EC155 helicopters in Shell contract were upgraded to AW139 number includes overlap of 5 EC155’s
14
335
318
12
10
268
8
168
6
4
2
0
09A
1.
2.
12A
DPS
2
2010
11A
Dividends
3
1.5
10A
EBITDA (LHS)
3
2
09A
2014
1
3.5
2.5
0%
kobo
10
45%
35%
4
11
50%
40%
4.5
5
15
5
6.09
10A
11A
Dividends(LHS)
12A
13A
14A
DPS(RHS)
25