ODIN Offshore. Årskommentar 2014

ODIN Offshore Årskommentar 2014

Fondens portfölj

ODIN Offshore december 2014 Avkastning senaste månaden och hittills i år Fondens värde sjönk med 1,4 procent under den senaste månaden. Fondens referensindex steg under samma tidsperiod med 0,8 procent. Fondens värde har hittills i år sjunkit med 26,5 procent. Referensindex har sjunkit 14,4 procent. Köp och försäljning i fonden, senaste månaden och hittills i år Denna månad har vi gjort relativt som ändringar i portföljen. I år är de största förändringarna i portföljen reducerad exponering mot rigg sektorn och ökad andel i Schlumberger. Bidragsgivare, senaste månaden och hittills i år De bästa bidragsgivarna till denna månads avkastning var bolagen PGS, Schlumberger och Rowan De bolag som bidrog minst till avkastningen denna månad var Havila Shipping, Pacific Drilling och Emas Offshore I år har bolagen Baker Hughes, Schlumberger och BW Offshore bidragit mest. De svagaste bidragen till avkastningen i portföljen i år är Sevan Drilling, DOF och Farstad.

ODIN Offshore december 2014 Prissättning av fonden Fonden prissätts till 9,7 gånger de kommande 12 månadernas resultat. Fonden ger en direktavkastning på 2,8 procent. Utöver detta tillkommer även återköp av aktier i bolagen. Mätt mot bokfört egenkapital prissätts fonden till 0,8 gånger. Innehaven i fonden har en genomsnittlig egenkapitalavkastning på 10,3 procent. Prissättning av aktiemarknaden för oljeserviceaktier - PHLX Oil Services PHLX Oil Services prissätts till 13,3 gånger de kommande 12 månadernas resultat. PHLX Oil Services ger en direktavkastning på 2,4 procent. Mätt mot bokfört egenkapital prissätts PHLX Oil Services till 1,6. Bolagen i PHLX Oil Services har en genomsnittlig egenkapitalavkastning på 12,7 procent.

ODIN Offshore Förvaltarens årskommentar 2014 Mer om fondens avkastning Det senaste året har ODIN Offshore visat betydligt lägre avkastning jämfört med fondens referensindex, Philadelphia Oil services, OSX. Avkastning i lokal valuta Benchmarkindex är ett prisviktat index som består av femton amerikanska bolag, noterade i dollar. Under 2014 ökade USD med cirka 23 % mot den norska kronan. Fondens portfölj har typiskt varit investerad 50/50 i amerikanska och norska bolag. Den lägre avkastningen beror således på dollarns styrka mot den norska kronan. Det norska oljeserviceindexet har minskat med strax över 41 %, medan OSX har minskat ca 25 % i lokal valuta. ODIN Offshore har minskat med något mindre än 14 %. 5

ODIN Offshore Året präglades av volatila aktiekurser och kraftigt fallande oljepris Den första hälften av 2014 präglades av ökande osäkerhet för offshorebolagen, samtidigt som onshorebolagen upplevde stigande efterfrågan och ökande aktivitet. Skillnaden återspeglades i aktiekurserna onshoreaktierna steg kraftigt och offshoreaktierna tappade. Flera större oljebolag som huvudsakligen är verksamma inom offshore upplevde att deras kassaflöde inte var tillräckligt för att täcka investeringsbudgetar och utdelning och reducerade därför tillväxten i sina letnings- och utvecklingsbudgetar. Servicebolag inom seismik och rigg märkte av detta i form av pressad ratenivå och minskad utnyttjandegrad. I takt med de stadigt fallande oljepriserna under hösten har klimatet förändrats dramatiskt för servicebolagen. Oljebolagen gör nedskärningar i sina investeringsbudgetar, skjuter upp projekt och minskar sina kostnader för både off- och onshore. Aktiekurserna har fallit dramatiskt och bolagen upplever en utmanande vardag. Konsolidering och kostnadsjusteringar tvingas fram och gör bolagen mer robusta, men för att det åter ska kunna vända uppåt krävs högre oljepriser. Större bolag riktade sina investeringar mot onshore, där de uppfattade avkastningspotentialen som större och riskerna som lägre. Den amerikanska skifferoljeproduktionen ökade kraftigt under året, driven av teknisk utveckling, effektivitetsförbättringar och expansion till nya områden. Servicebolagens aktivitet ökade till följd av detta kraftigt. 6

ODIN Offshore Inga nedskärningar från OPEC oljepriset fortsatte att falla OPEC beslutade vid sitt möte i Wien att behålla sitt produktionsmål på 30 miljoner fat per dag. Före mötet var förväntningarna mycket olika, men flera analytiker förväntade sig nedskärningar från OPEC. Oljepriset fortsatte nedåt efter mötet och handlas nu till strax över 60 dollar per fat. Historiskt stimuleras oljeefterfrågan av lägre priser genom ökad konsumtion och bättre konkurrenskraft i förhållande till andra energikällor. OPEC-länderna medger att oljemarknaden präglas av tillgångsöverskott och att situationen kommer att hålla i sig under 2015 så länge icke-opec-ländernas produktionstillväxt är högre än den globala tillväxten på efterfrågan. OPEC avvaktar och låter marknaden bestämma priset på oljan. De centrala punkterna att följa framöver blir i synnerhet utvecklingen av den amerikanska skifferoljeproduktionen och dynamiken hos den globala efterfrågan. Nu sätts de amerikanska skifferoljeproducenterna på prov och vi får veta hur mycket investeringarna och produktionen tål vid lägre oljepriser. 7

ODIN Offshore Fortsatt kraftig ökning av den amerikanska skifferoljeproduktionen, men oljeprisfallet märks Den nordamerikanska oljeproduktionen, i synnerhet från skiffer, fortsätter att överraska. Tillväxten har konsekvent varit betydligt högre än förväntat under året. Den kraftiga ökningen har överraskat analytikerna och IEA och prognoserna har justerats upp. USA har i dag exportförbud mot råolja vilket innebär att konsekvenserna av produktionsökningen främst är logistikutmaningar, fulla lager och det fallande oljepriset. Det finns stora regionala variationer och osäkerhet råder kring lönsamheten av skifferproduktion. Det blir därför spännande och viktigt att följa produktionsutvecklingen framöver i en situation med låga oljepriser. Detta kommer i sin tur att få stora konsekvenser för aktiviteterna inom oljeservice och för aktiekurserna. Till skillnad från vid offshore är tiden från borrstart till produktion kort och dynamiken i justeringar av produktions- och investeringsnivåer betydligt större. Flera tongivande skifferoljeproducenter har redan tillkännagivit nedskärningar i sina investeringsbudgetar, även om detta ännu inte har fått något särskilt utslag i statistiken, till exempel riggräkningar. Under 2015 förväntas i första hand tillväxttakten i produktionen att minska. 8

ODIN Offshore För mycket pessimism i dagens oljepris? Genom media är det lätt att få intrycket att oljepriset faller helt okontrollerat och fokus ligger på experter som kontinuerligt tävlar om att sätta lägst riktpris. Vi tror att det finns många faktorer som pekar på högre snarare än lägre priser framöver. Huvudproblemet är att tillväxten ärr större i produktionen än i efterfrågan. Dynamiken tyder på lägre produktion via färre lönsamma projekt och ökad efterfrågan via låga priser. Vi tror att detta i praktiken först kommer att märkas av i USA. För de allra flesta av OPEC-länderna medför dagens låga priser betydande utmaningar och risken för effekter som sociala upplopp ökar. Vi tror att möjligheten finns att OPEC koordinerar nedskärningar för fler länder än bara Saudiarabien. Skifferoljeproduktionen är här för att stanna och kommer troligen, vad som än händer, att leda till lägre oljepriser, vilket marginalerna tillåter, men på en högre nivå än vi ser i dag. 9

ODIN Offshore Konsolidering och uppköp inom oljeservice Det kraftiga oljeprisfallet gör att servicebolagen nu måste anpassa sig efter en tuffare vardag. Initiativ till nedskärningar och jakt på ytterligare synergier har lett till en rad konsolideringar och uppköp. Den föreslagna fusionen av de amerikanska servicebolagen Halliburton och Baker Hughes skapar en ny jätte i nivå med Schlumberger, sett till omsättningen. På riggsidan köper amerikanska Paragon det norska Jack up-bolaget Prospector Offshore och inom seismik vill det franska byggbolaget Technip köpa upp det franska seismikbolaget CGG. Gemensamt för samtliga transaktioner är att det betalas betydande premier i förhållande till målbolagens börskurser. ODIN Offshore accepterade budet i Prospector och sålde sig ut ur bolaget. I Hallliburton och Baker Hughes upprätthåller vi våra positioner och ser positiva effekter i form av synergier och ytterligare ökad konkurrenskraft till följd av den föreslagna transaktionen. 10

ODIN Offshore Ännu tuffare vardag för riggbolagen Till följd av det kraftigt fallande oljepriset ökar pressen på riggbranschen inom offshore. Efterfrågan minskas i takt med nedskärningar i investeringsbudgetar samtidigt som efterfrågan ökar till följd av leveranser av nybyggnationer och utlgång eller avbrytanden av befintliga kontrakt. Dagraterna fortsätter att falla och konkurrensen hårdnar om nya kontrakt. Bolagen prioriterar utnyttjande framför rate för att säkra sitt kassaflöde. Större riggbolag som Seadrill har varit prissatta långt över de underliggande värdena till följd av höga utdelningar. Nu väntar tuffare tider för bolaget och utdelningarna ställs tills vidare in. Till följd av detta faller aktiekursen kraftigt och har minskat med över 65 % under 2014. ODIN Offshore äger inga aktier i Seadrill och har generellt låg exponering mot riggsektorn. 11

Nyckeltal och nyheter från portföljen presenteras på engelska

Portfolio Return Last 5 years % (EUR) ODIN Offshore Historical Return % (EUR)* Index Portfolio Last Month -1,38 YTD -26,49 1 Y -26,49 3 Y -4,17 5 Y -2,78 10 Y 5,62 Since inception 3,72 Benchmark 0,14-14,87-14,87 1,32 4,79 6,65 0,83 Exess Return -1,52-11,62-11,62-5,49-7,57-1,03 2,89 * Returns for periods exceeding 12 months are annualized

Annual returns last 10 years

15 Current holdings

16 Contribution, year to date

Risk Statistics (NOK) 3 Years Alpha Beta Tracking Error Information Ratio Portfolio -4,99 0,88 9,41-0,61 Index Sharpe Ratio 1) -0,04 0,32 Standard Deviation 2) 16,83 15,93 1) Sharpe Ratio uses Norway - 3 MT Bills as risk free rate. 2) Standard Deviation is based upon monthly volatility.

Pricing of the fund Company Weight Country Industry P/E (LTM)* P/E (NTM)* DivYield (LTM) DivYield (NTM) P/B ROE Schlumberger NV 9,1% United States Energy Equipment & Services 15,4 17,1 1,9 1,9 2,7 17,7 Baker Hughes Incorporated 8,7% United States Energy Equipment & Services 14,4 17,2 1,1 1,2 1,3 9,2 Halliburton Company 8,7% United States Energy Equipment & Services 9,9 11,8 1,6 1,8 2,1 20,8 Solstad Offshore ASA 5,2% Norway Energy Equipment & Services 3,8 4,4 6,3 6,3 0,5 14,5 BW Offshore Limited 4,6% Norway Energy Equipment & Services 3,7 7,3 12,0 12,0 0,6 15,2 Weatherford International plc 4,6% United States Energy Equipment & Services 10,9 12,1 0,0 0,0 1,1 10,0 Cameron International 4,6% United States Energy Equipment & Services 12,2 11,4 0,0 0,0 1,8 14,5 Superior Energy Services, Inc. 4,4% United States Energy Equipment & Services 11,1 13,9 1,6 1,6 0,8 6,8 Atlantica Tender Drilling Ltd. 4,3% Norway Energy Equipment & Services 0,0 0,0 0,0 0,0 0,0 0,0 Rowan Cos. Plc Class A 3,8% United States Energy Equipment & Services 10,8 6,9 1,3 1,7 0,6 5,2 Topp 10 58,1% 9,3 11,0 2,4 2,5 1,1 12,2 ODIN Offshore 7,6 9,7 2,6 2,8 0,8 10,4 * NTM = Next 12 months LTM = Last 12 months Adjusted earnings and fully diltuted number of shares

19 MSCI World Price, Earnings and P/E

20 MSCI World Price, Book Value and P/B

OECD Leading indicator Level above 100 indicates expanding activity in OECD area 21

22 The International Monetary Fund (IMF) Economic growth forecast 2014 - updated October

Investments - ODIN Offshore

Badger Explorer Badger Explorer is developing a revolutionary tool to obtain subsurface data for oil and gas exploration, mapping of hydrocarbon resources and long-term surveillance. The Badger Explorer drills and buries underground, carrying a unique package of logging and monitoring sensors, at a substantially lower risk, cost and complexity of utilising an expensive drilling rig. Development of the technology has taken longer than expected, but has been funded by oil companies sponsorships rather than dilutive equity issues. The company has ongoing prototype development agreements with major oil companies like Exxon Mobile, Shell, Statoil and wintershall as well as partner agreement with China National Petroleum Corporation Driiling Resarch Institute. The Badger tool can potentially save the oil companies huge costs when exploring for oil and gas fields. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Badger Explorer ASA Badger Explorer ASA PHLX Oil Service Index TR Industrial Machinery Market Value (mill.) 74 Price 4.00 Price currency NOK Net debt (mill.) -25 Reporting currency NOK Enterprise Value (mill.) 49 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 9 12 10 8 0 - - EBIT (Operating Income) (mill.) -17-20 -31-39 -51 - - Net Income (mill.) -13-21 -29-20 -20 - - Price/Earnings - - - - - - - Price/Book Value 1.8 2.8 1.8 1.1 1.5 - - EV/EBIT - - - - - - - Return on Equity (%) -6.3-11.2-18.3-15.2-17.2 - - Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 - - 24

Baker Hughes Baker Hughes is one of the major intergrated american oil service companies - big3 operating on a global basis. The company delivers solutions that help oil and gas operators make the most of their reservoirs. 250 200 150 100 Performance - last 5 years Two of the biggest US oil services companies Halliburton(HAL) and Baker Hughes(BHI) has agreed to a transaction where HAL aquires BHI in a 75% stock deal. BHI shareholders will receive 1,12 HAL shares plus $19 in cash. A 30% premium to pre transaction shareprice. Synergies is estimated at $2 billion, driven by by the complementarity of product service lines and geography. The combined company will be a giant matching Sclumberger(SLB) in terms of turnover and broad product line. Historically SLB has traded at substantial pricing ratio premiums to HAL and BHI. Over time the «new» HAL/BHI company is expected to narrow its pricing discount to SLB. 50 0 des.09 des.10 des.11 des.12 des.13 des.14 Baker Hughes Incorporated Baker Hughes Incorporated PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 23,862 Price 55.15 Price currency USD Net debt (mill.) 2,982 Reporting currency USD Enterprise Value (mill.) 26,844 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 9,664 14,414 19,831 21,361 22,364 24,405 24,843 EBIT (Operating Income) (mill.) 831 1,558 2,922 2,256 1,947 2,888 2,977 Net Income (mill.) 421 812 1,739 1,311 1,096 1,584 1,828 Price/Earnings 16.3 38.1 12.1 12.7 23.0 14.3 15.2 Price/Book Value 1.7 1.8 1.4 1.1 1.4 1.3 1.3 EV/EBIT 15.4 16.0 8.4 9.8 14.2 9.5 8.8 Return on Equity (%) 6.0 7.6 11.7 8.0 6.3 9.3 8.3 Dividend Yield (%) 1.5 1.0 1.2 1.5 1.1 1.1 1.2 25 The transaction is expected to close 2H 2015.

Bergen Group The Bergen Group is a yard group offering offshore and maritime services and products. The group has been through a extensive turnaround and has now completed the exit from discontinued business and upgraded its yard facilities at Hanøytangen. 250 200 150 100 50 Performance - last 5 years The services segments profit margins are improving both for industrial and maritime services and the order book is growing. The activity in the offshore segment is increasing and the company is involved in high tender submissions on comprehensive rig projects. Bergen is in a process for securing long term financing and is also considering strategic opportunities. 0 des.09 des.10 des.11 des.12 des.13 des.14 Bergen Group ASA Bergen Group ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 124 Price 2.05 Price currency NOK Net debt (mill.) 800 Reporting currency NOK Enterprise Value (mill.) 925 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 5,107 3,339 3,735 3,456 3,055 3,918 - EBIT (Operating Income) (mill.) 325 98 115-614 -210 7 - Net Income (mill.) 78 11-109 -753-594 - - Price/Earnings 2.4-11.0 - - 140.5 - Price/Book Value 0.2 0.3 0.2 0.3 0.3 - - EV/EBIT 5.0 8.0 10.2 - - - - Return on Equity (%) 5.3 0.7-6.9-66.0-89.4 - - Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 26

BW Offshore BW Offshore owns and operate a fleet of floating production vessels(fpso) on a global basis. Major part of operations is in West Africa and Latin America(Brazil and Mexico). The market for FPSOs has been challeging with low returns due to poor management of risky projects. Several competitors are bankrupt, only a handful of companies are still in the industry. BWs existing fleet is generating a high predicitable cash flow from term contracts. In addition to visible growth from a new project based on a newbuild. The new vesslel project is taken on after an extensive feed study paid by the client, reducing risk compared to earlier projects based on conversion of older crude tankers. Dividends are paid on a quaterly basis and is trading on a high running yield. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 BW Offshore Limited BW Offshore Limited PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 4,568 Price 6.64 Price currency NOK Net debt (mill.) 9,791 Reporting currency USD Enterprise Value (mill.) 14,360 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 409 549 846 909 982 1,027 887 EBIT (Operating Income) (mill.) 45 81 122 21 186 300 191 Net Income (mill.) -9-100 -115-84 197 96 Price/Earnings - 51.7 42.6-5.1 3.5 6.8 Price/Book Value 0.7 1.3 0.8 0.6 0.7 0.5 0.5 EV/EBIT 34.5 34.6 24.5 104.8 13.5 7.7 12.9 Return on Equity (%) -0.9-9.0-8.6 0.0 7.5 15.2 7.7 Dividend Yield (%) 0.0 0.0 4.5 10.1 6.4 12.7 12.7 27

Cameron Cameron engineers, designs, and manufactures value-driven solutions for the global oil and gas industry both on- and offshore. The company is a leading provider of blow out preventers for rigs and subsea trees for subsea solutions. Cameron is the leading company offering high quality products among a handful dominating the global equipment market. Its products helps the oil companies improving efficiency, save costs and increase production. The company has an extensive backlog of orders for execution the coming years, in addition to a growing base of installed equipment offering potential for services and after market sales. Cameron is a high quality company with a good long term track record from profitable growth in addition to aggressively buy backs of own shares. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Cameron International Corporation Cameron International Corporation PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 9,004 Price 45.60 Price currency USD Net debt (mill.) 1,006 Reporting currency USD Enterprise Value (mill.) 10,009 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 5,241 6,140 6,957 8,508 9,836 10,599 10,814 EBIT (Operating Income) (mill.) 836 873 920 1,071 1,131 1,291 1,412 Net Income (mill.) 476 563 522 751 699 846 934 Price/Earnings 17.6 25.1 20.9 22.2 21.0 11.5 10.1 Price/Book Value 3.2 2.9 2.6 2.6 2.2 1.7 1.5 EV/EBIT 10.5 13.8 13.6 13.4 14.6 8.7 7.5 Return on Equity (%) 15.2 13.5 11.5 14.6 12.2 14.5 15.0 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 28

DOF DOF owns and operates a fleet of modern offshore support vessels(osv) on a global basis. Major part of operations is in the North Sea and Latin America(Brazil). The major part of the PSV and AHTS fleet is fixed on term contracts, the CSV fleet is controlled and operated by the subsidiary DOF Subsea. DOF is highly leveraged and has 8 newbuild under construction( all fixed on long term contacts). The company has been expanding it fleet aggressively over time, going forward the focus will shift to execution and deleverage. Due to its high leverage DOF is trading at a substantial discount to net asset values. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 DOF ASA DOF ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 1,377 Price 12.40 Price currency NOK Net debt (mill.) 21,921 Reporting currency NOK Enterprise Value (mill.) 23,298 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 4,259 5,403 6,503 8,136 9,754 10,196 10,112 EBIT (Operating Income) (mill.) 328 484 1,124 1,680 1,909 2,384 2,250 Net Income (mill.) 602-140 -356 113-191 577 502 Price/Earnings 8.8 - - 31.8-3.2 2.6 Price/Book Value 0.9 1.2 0.6 0.8 1.0 0.3 0.3 EV/EBIT 53.2 46.7 21.5 15.8 14.9 9.1 9.7 Return on Equity (%) 17.0-3.5-8.9 2.9-5.3 10.8 11.9 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 29

EMGS EMGS is the leading global provider of EM seismic. The company has conducted impressive surveys in ie Mexico and the Barents sea. EM is used by the oil industry as a supplement to seismic for evaluating drilling locations. EMGS is operating a four vessel fleet, the challenge has been to acheive utilisation on a continued basis. The adoption of the EM technology picks up, but more slowly than expected. EMGS is a small company with a limited salesforce. Agreements and JV projects with seismic companies like TGS, Spectrum and Western Geco bundling EM and seismic is expected to contribute to increased sales and broader technology adoption. The company has a strong balance sheet and is generating a positive cash flow. It can be viewed as a option on increased adoption of EM and as a aquisition candidate for larger seismic players. 500 450 400 350 300 250 200 150 100 50 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 ElectroMagnetic GeoServices ASA ElectroMagnetic GeoServices ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 753 Price 3.77 Price currency NOK Net debt (mill.) 1 Reporting currency USD Enterprise Value (mill.) 754 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 59 75 172 201 145 190 205 EBIT (Operating Income) (mill.) -63-25 25 29-12 19 15 Net Income (mill.) -81-55 10 12-15 11 8 Price/Earnings - - - 16.1-10.1 12.6 Price/Book Value 2.5 10.5 5.6 4.1 2.6 0.9 1.0 EV/EBIT - - 16.2 15.3-6.0 7.6 Return on Equity (%) -142.0-428.6 20.5 12.0-14.4 8.6 7.8 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 30

EMAS Offshore Performance - last 5 years EMAS offshore is an established offshore services provider offering offshore support services, accommodation, construction and production services to customers in the oil and gas industry throughout the oilfield lifecycle, spanning exploration, development, production and decommissioning stages. EMAS Offshore is the combination of EOC and the offshore support vessels fleet from Ezra. The new company has one of the youngest and largest deepwater OSV fleets based in Asia Pacific, mostly on term contracts. The fleet of accommodation vessels and FPSOs are on longer term contracts as well. After the merger EMAS should be wellpositioned to capture market opportunities across its business segments with its attractive fleet and as a part of an integrated offshore solutions group. 160 140 120 100 80 60 40 20 0 des.09 des.10 des.11 des.12 des.13 des.14 EMAS Offshore Limited EMAS Offshore Limited PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 199 Price 2.60 Price currency SGD Net debt (mill.) 110 Reporting currency USD Enterprise Value (mill.) 309 FX rate (NOK) 5.74 2010 2011 2012 2013 2014 2015E 2016E Sales (mill.) 113 178 133 43 47 - - EBIT (Operating Income) (mill.) 32 29-3 12 9 - - Net Income (mill.) 21 18-13 11 54 - - Price/Earnings 6.0 7.5 7.0-10.1 - - Price/Book Value 1.1 1.0 0.8 0.4 0.6 - - EV/EBIT 13.9 14.5-17.6 25.6 - - Return on Equity (%) 14.2 10.7-8.1 6.4 26.2 - - Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 - - EMAS has a strong operational track record and a strong, stable and diverse global customer base.

Farstad Shipping Farstad Shipping is a leading supply shipping company focusing on large and advanced offshore supply vessels. Majority of the fleet is operating in Brazil, North west Europe and the Indian Pacific region. Among its norwegian peers Farstad is the best performing company in terms of historically return and track record. Mgt has a longer term approach, focusing on term contracts and dividends. Farstad is expanding in the subsea segment by two vessels, currently under construction, without contracts. The strategy is to invest in segments with higher barriers of entry, however they might be late to the party. The company is trading at a substantial discount to NAV and book values. Fairly high leverage after delivery of the the subsea newbuilds is increasing the risk. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Farstad Shipping ASA Farstad Shipping ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 1,533 Price 39.30 Price currency NOK Net debt (mill.) 7,769 Reporting currency NOK Enterprise Value (mill.) 9,301 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 3,237 3,353 3,579 3,710 3,998 4,408 4,656 EBIT (Operating Income) (mill.) 1,261 894 851 736 854 923 978 Net Income (mill.) 1,932 432 568 312 260 319 359 Price/Earnings 3.2 5.4 12.6 12.5 21.2 4.4 4.1 Price/Book Value 0.9 1.0 0.9 0.8 0.8 0.2 0.2 EV/EBIT 7.6 13.2 13.3 15.7 15.2 11.4 11.2 Return on Equity (%) 36.1 6.7 8.5 4.6 3.8 4.7 4.9 Dividend Yield (%) 2.7 2.1 3.1 2.6 2.3 7.9 7.9

Ganger Rolf Ganger Rolf is energy conglomorate invested in offshore drilling, renewable energy, shipping/offshore wind, cruise and property. Ganger Rolf is controlled by the Fred Olsen family. The company is trading at a substatial discount to sum of the parts and has focused on paying a consistent dividend over time. Performance - last 5 years 200 180 160 140 120 100 80 60 40 20 0 des.09 des.10 des.11 des.12 des.13 des.14 Ganger Rolf ASA PHLX Oil Service Index TR Ganger Rolf ASA Marine Shipping Market Value (mill.) 2,141 Price 63.25 Price currency NOK Net debt (mill.) 1,332 Reporting currency NOK Enterprise Value (mill.) 3,474 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 9 10 1 0 0 - - EBIT (Operating Income) (mill.) -36-33 -68-56 -48 - - Net Income (mill.) 653 333 237 373 350 - - Price/Earnings 11.3 24.4 8.2 14.4 10.5 - - Price/Book Value 1.1 1.2 0.7 0.8 0.8 - - EV/EBIT - - - - - - - Return on Equity (%) 13.1 6.8 4.7 7.4 7.0 - - Dividend Yield (%) 6.8 5.1 6.2 6.2 6.6 - - 33

Halliburton Halliburton is one of the major intergrated american oil service companies - big3 operating on a global basis. The company is the market leader on fracking in North America. 300 250 200 150 100 Performance - last 5 years Two of the biggest US oil services companies Halliburton(HAL) and Baker Hughes(BHI) has agreed to a transaction where HAL aquires BHI in a 75% stock deal. BHI shareholders will receive 1,12 HAL shares plus $19 in cash. A 30% premium to pre transaction shareprice. Synergies is estimated at $2 billion, driven by by the complementarity of product service lines and geography. The combined company will be a giant matching Sclumberger(SLB) in terms of turnover and broad product line. Historically SLB has traded at substantial pricing ratio premiums to HAL and BHI. Over time the «new» HAL/BHI company is expected to narrow its pricing discount to SLB. 50 0 des.09 des.10 des.11 des.12 des.13 des.14 Halliburton Company Halliburton Company PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 32,297 Price 38.11 Price currency USD Net debt (mill.) 5,221 Reporting currency USD Enterprise Value (mill.) 37,518 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 14,675 17,973 24,829 28,503 29,402 33,016 33,053 EBIT (Operating Income) (mill.) 1,989 2,999 4,737 4,459 4,230 5,138 5,595 Net Income (mill.) 1,154 1,795 3,005 2,577 2,106 3,431 3,632 Price/Earnings 19.7 25.0 12.5 11.2 23.3 9.8 9.6 Price/Book Value 3.2 3.8 2.6 2.1 3.4 2.1 1.8 EV/EBIT 14.3 13.0 7.1 7.7 12.1 7.6 6.6 Return on Equity (%) 14.0 18.8 25.5 17.8 14.4 21.0 18.5 Dividend Yield (%) 1.2 0.9 1.0 1.0 0.9 1.6 1.8 34 The transaction is expected to close 2H 2015

Havila Shipping Havila Shipping is a supply shipping company focusing on offshore supply vessels. Majority of the fleet is operating on longer term contracts. Havilas fleet is one of the most modern in the industry with an average age of 5 years. The company has no newbuilds on order and is focusing on deleveraging. Havila is trading at a substantial discount to NAV and is considering to buy back own shares. The companys main shareholder is opportunistic having previously started and sold two supply vessel companies. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Havila Shipping ASA Havila Shipping ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 522 Price 17.30 Price currency NOK Net debt (mill.) 5,529 Reporting currency NOK Enterprise Value (mill.) 6,051 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 887 1,030 1,279 1,332 1,436 1,697 1,576 EBIT (Operating Income) (mill.) 301 162 198 351 488 626 514 Net Income (mill.) 537-8 -139 0 13 155 113 Price/Earnings 2.1 13.2 - - 15.5 3.3 3.9 Price/Book Value 0.6 0.6 0.4 0.3 0.5 0.2 0.2 EV/EBIT 13.3 29.2 30.1 17.9 13.3 9.5 11.1 Return on Equity (%) 38.5-0.5-8.0 0.0 0.7 7.4 5.9 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 35

Kongsberg Gruppen Kongsberg Gruppen is a global company operating within the oil&gas,- maritime, - and defence sectors worldwide. The company supplies high-technology systems and solutions. Strong R&D capabilities. A proven asset-light model with strong returns on capital. High barriers to entry and strong niche positions in different product groups. Consequently the company has an outstanding track record in value creation. We think the company will continue its top-line growth based on strong competitive positions built over the last few years. The risk to our investment case is austerity measures on the defence side which we have seen over the last couple of years, and falling capex among oil companies on the offshore/maritime side. Government of Norway a majority owner 250 200 150 100 50 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Kongsberg Gruppen ASA Kongsberg Gruppen ASA PHLX Oil Service Index TR Aerospace & Defense Market Value (mill.) 14,040 Price 117.00 Price currency NOK Net debt (mill.) -2,108 Reporting currency NOK Enterprise Value (mill.) 11,932 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 13,816 15,497 15,128 15,652 16,323 16,660 17,209 EBIT (Operating Income) (mill.) 1,263 2,113 2,035 1,866 1,659 1,556 1,730 Net Income (mill.) 820 1,495 1,431 1,325 1,228 1,135 1,256 Price/Earnings 15.2 12.6 8.7 10.8 13.2 12.6 11.3 Price/Book Value 3.1 3.7 2.6 2.4 2.4 2.0 1.8 EV/EBIT 7.3 6.3 5.6 7.0 8.0 7.2 6.2 Return on Equity (%) 29.4 34.9 27.7 22.6 19.0 15.8 16.1 Dividend Yield (%) 3.3 2.5 3.2 3.0 3.2 3.8 4.2 36

National Oilwell NOV engineers, designs, and manufactures equipment for the global oil and gas industry both on- and offshore. The company is a leading provider of rig systems, wellbore technologies and completion & production solutions. National is the dominant global equipment provider with a fantastic track record in terms of profitable growth. The company has an extensive backlog of orders for execution the coming years, in addition to a growing base of installed equipment offering potential for services and after market sales. Nov has a multi approach towards returning value to shareholders. NOV intends to return its steady US-generated free cash to shareholders via dividends, repatriated cash (92% of NOV's cash is overseas) via opportunistic buybacks under the recently announced $3B program, and excess balance sheet capacity via potential extraordinary buybacks. 250 200 150 100 50 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 National Oilwell Varco, Inc. National Oilwell Varco, Inc. PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 26,842 Price 62.34 Price currency USD Net debt (mill.) -286 Reporting currency USD Enterprise Value (mill.) 26,556 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 12,712 12,146 14,650 20,035 22,751 21,478 21,174 EBIT (Operating Income) (mill.) 2,473 2,470 2,889 3,525 3,311 3,775 3,743 Net Income (mill.) 1,469 1,667 1,994 2,491 2,327 2,591 2,594 Price/Earnings 11.1 17.4 15.5 12.2 14.6 10.6 10.8 Price/Book Value 1.3 1.8 1.7 1.5 1.6 1.2 1.2 EV/EBIT 6.8 10.5 9.0 8.3 10.2 6.9 6.6 Return on Equity (%) 11.0 11.2 12.0 13.2 11.0 11.7 10.7 Dividend Yield (%) 0.0 0.6 0.6 0.7 1.0 2.6 2.9 37

North Energy North Energy is a E&P company focusing on exploration in the Barents Sea. North has a portfolio of exciting licences in the Barents Sea. Due to its local headquaters and mgt the compant is beeing preferred in licence rounds. Norths approach to exploration is different from its peers, focusing on EM and virtual drilling. It has ongoing agreements with EMGS and REX providing data and technology. The idea is to increase the probability of finding oil fields and reduce drilling costs. Norths drilling program is fully funded by means of a share issue. Performance - last 5 years 180 160 140 120 100 80 60 40 20 0 des.09 des.10 des.11 des.12 des.13 des.14 North Energy ASA PHLX Oil Service Index TR North Energy ASA Oil & Gas Production Market Value (mill.) 262 Price 2.20 Price currency NOK Net debt (mill.) 191 Reporting currency NOK Enterprise Value (mill.) 453 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) - - - - - 3 - EBIT (Operating Income) (mill.) -208-237 -399-316 -790-367 -408 Net Income (mill.) -64-63 -111-112 -150-106 -114 Price/Earnings - - - - - - - Price/Book Value - 1.1 0.5 0.3 0.4 0.6 0.8 EV/EBIT - - - - - - - Return on Equity (%) -48.0-19.9-26.0-28.6-44.6-26.0-34.0 Dividend Yield (%) - 0.0 0.0 0.0 0.0 0.0 0.0 38

Pacific Drilling Pacific Drilling S.A. is a offshore drilling company that provides global ultra deep water drilling services to the oil and natural gas industry through the use of high-specification drillship. Pacific have one of the newest and most technologically advanced fleets in the world. The vessels are all state-of-the-art, highspecification units, which benefit from a proven design and highly developed construction techniques. Clients prefer modern vessels in a competitive rig market, saving cost and drilling days in addition to being more efficient and safer. The company have 6 drill ships working on longer term contracts and 2 newbuilds under construction. 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Pacific Drilling S.A. Pacific Drilling S.A. PHLX Oil Service Index TR Contract Drilling Market Value (mill.) 970 Price 4.46 Price currency USD Net debt (mill.) 2,227 Reporting currency USD Enterprise Value (mill.) 3,196 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) - - 65 638 746 1,074 1,327 EBIT (Operating Income) (mill.) -9-20 -29 133 210 352 415 Net Income (mill.) -2 37-3 34 26 178 210 Price/Earnings - - - 53.9-5.7 4.9 Price/Book Value - - - 0.9 0.9 0.4 0.4 EV/EBIT - - - 27.3 22.4 13.5 11.8 Return on Equity (%) - 3.0-0.1 1.5 1.1 6.9 7.8 Dividend Yield (%) - - 0.0 0.0 0.0 0.0 15.0 39

Petroleum Geo Service Petroleum Geo services (PGS) offers a broad range of products including seismic and electromagnetic services, data acquisition, processing, reservoir analysis/interpretation and multi-client library data helping oil companies to find oil and gas reserves offshore worldwide. In a currently challenging seismic market PGS is best positioned in the industry with the most modern and cost efficient fleet and is differentiating itself from peers from its Geostreamer technology. PGS has a solid liquidity reserve and the balance sheet to navigate through the downturn in the seismic market and take delivery of two newbuilds coming on stream in 2015 and 16. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Petroleum Geo-Services ASA Petroleum Geo-Services ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 8,712 Price 40.00 Price currency NOK Net debt (mill.) 4,538 Reporting currency USD Enterprise Value (mill.) 13,250 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 1,350 1,135 1,253 1,518 1,502 1,442 1,406 EBIT (Operating Income) (mill.) 387 137 137 292 396 213 186 Net Income (mill.) 174-16 33 186 238 84 107 Price/Earnings 9.8-34.7 23.1 10.6 11.7 11.4 Price/Book Value 1.6 2.2 1.4 1.9 1.3 0.6 0.6 EV/EBIT 7.0 24.3 22.5 13.9 8.6 10.2 12.8 Return on Equity (%) 13.4-1.1 1.8 10.2 12.1 5.1 5.1 Dividend Yield (%) 0.0 0.0 1.3 1.6 3.0 6.3 6.1 40

Prosafe Prosafe is the world s leading owner and operator of semi-submersible accommodation vessels. The fleet consists of a combination of dynamically positioned and anchored vessels able to operate in nearly all offshore environments. Prosafe has a track record of profitable growth with high return on invested capital, based on term contracts and opportunistic counter cyclical M&A. The market has historically been a niche market with few competitors, however a few new companies are now entering the scene with newbuilding orders. Increasing supply increases risk of pressure on dayrates going forward. Prosafes backlog of contracts is currently at record levels giving visiblity the next few years. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 ProSafe SE ProSafe SE PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 4,627 Price 19.61 Price currency NOK Net debt (mill.) 4,042 Reporting currency USD Enterprise Value (mill.) 8,669 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 369 397 401 424 523 547 657 EBIT (Operating Income) (mill.) 189 176 143 136 245 242 285 Net Income (mill.) 127 199 158 178 199 188 212 Price/Earnings 7.5 10.6 11.0 10.7 10.3 3.7 3.2 Price/Book Value 5.7 4.4 3.5 3.7 2.6 0.9 0.8 EV/EBIT 10.6 13.0 16.3 18.2 10.4 7.0 6.6 Return on Equity (%) 66.7 61.4 34.5 36.7 31.8 24.6 23.2 Dividend Yield (%) 1.8 4.0 5.5 6.9 7.1 14.4 7.1 41

Rowan Rowan Companies is a global provider of offshore contract drilling services, focused on operating safely and efficiently. A market leader with one of the youngest fleets in the industry, including four ultra-deep water drillships and 30 jack-up rigs, 19 of which are rated high-specification. The rig markets are currently challenging, with demand weakening and newbuilding deliveries increasing supply. Dayrates are under pressure from operators preferring utilisation ahead of dayrates. Rowans four drillships are fixed on long term contracts securing visible cash flow. We are cautious on drillers in general, but Rowan trades at the most attractive multiples and lowest implied asset prices among it peers. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Rowan Cos. Plc Class A Rowan Cos. Plc Class A PHLX Oil Service Index TR Contract Drilling Market Value (mill.) 2,579 Price 20.71 Price currency USD Net debt (mill.) 916 Reporting currency USD Enterprise Value (mill.) 3,495 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 1,770 1,819 939 1,393 1,579 1,799 2,311 EBIT (Operating Income) (mill.) 495 392 154 278 316 383 614 Net Income (mill.) 368 280 136 203 253 316 444 Price/Earnings 6.4 14.0 23.0 24.1 17.0 10.2 6.3 Price/Book Value 0.9 1.2 0.9 0.9 0.9 0.5 0.5 EV/EBIT 5.6 12.5 29.4 17.5 16.8 13.8 8.8 Return on Equity (%) 12.7 8.2 3.4 4.6 5.4 5.1 7.9 Dividend Yield (%) 0.4 0.0 0.0 0.0 0.0 1.4 1.8 42

Schlumberger Schlumberger is the world s leading supplier of technology, integrated project management and information solutions to the oil and gas industry. Schlumberger provides the industry s widest range of products and services from exploration through production. The company is in forefront of technology development and is best in class in terms of execution track record. SLB is providing clients solutions optimizing and enhancing production and exploration. SLB has premium margins and return on capital employed compared to peers. Free cash flow is used for growth in addition to dividends and share buy backs. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Schlumberger NV Schlumberger NV PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 103,188 Price 80.19 Price currency USD Net debt (mill.) 4,806 Reporting currency USD Enterprise Value (mill.) 107,994 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 22,702 27,447 39,540 42,149 45,266 48,650 47,715 EBIT (Operating Income) (mill.) 3,765 4,673 6,712 7,478 8,297 9,694 9,344 Net Income (mill.) 3,156 4,267 4,777 5,439 6,801 7,297 7,120 Price/Earnings 22.5 25.5 20.7 16.8 18.7 15.0 15.4 Price/Book Value 4.0 3.7 2.9 2.7 3.1 2.7 2.5 EV/EBIT 21.2 23.3 14.6 13.1 15.1 11.8 12.0 Return on Equity (%) 17.5 17.0 15.3 16.5 18.3 17.8 16.3 Dividend Yield (%) 1.3 1.0 1.4 1.6 1.3 1.9 1.9 43

Sevan Drilling 140 120 Performance - last 5 years Sevan Drilling is an international drilling contractor specializing in the ultra deep water segment. The Company owns rigs of the cylindrical Sevan design. The rig markets are currently challenging, with demand weakening and newbuilding deliveries increasing supply. Dayrates are under pressure from operators preferring utilisation ahead of dayrates. Three of Sevans rigs are fixed on long term contracts securing visible cash flow. However operational issues have hurt earnings. Sevan has an addtional rig under construction in China. Due to severe delays at the yard, the company has a free option to take delivery the next three years or, if not contracted, get the paid instalments back. We are cautious on drillers in general, but Sevan trades at very low implied asset prices both compared to peers and current newbuilding prices. 100 80 60 40 20 0 des.09 des.10 des.11 des.12 des.13 des.14 Sevan Drilling ASA Sevan Drilling ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 369 Price 0.62 Price currency NOK Net debt (mill.) 7,527 Reporting currency USD Enterprise Value (mill.) 7,895 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) - 8 116 173 258 320 401 EBIT (Operating Income) (mill.) -5-13 7 12-5 49 88 Net Income (mill.) -2-18 -49-12 -157-12 56 Price/Earnings - - - - - - 1.7 Price/Book Value - - 0.4 0.3 0.7 0.1 0.1 EV/EBIT - - 132.6 81.2-26.7 14.4 Return on Equity (%) - - -14.0-1.8-23.5-1.9 3.7 Dividend Yield (%) - - 0.0 0.0 0.0 0.0 0.0

Solstad Offshore Solstad Offshore is a leading supply shipping company focusing on large and advanced offshore supply vessels. Majority of the fleet is operating in the North Sea and Latin America. Solstads strategy is focused on segments with advanced vessels and high barriers to entry. Subsea construction vessels are operated on long term contracts to the subsea development companies, while anchor handling tugs are more opportunistically operated in the spot market. Financial focus is shifting to cash flow generation and deleveraging after a rapid fleet expansion period. Only one new build is currently under construction. The Solstad shares are trading at a substantial discount to NAV and book values, in spite of solid dividends and buy back of own shares. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Solstad Offshore ASA Solstad Offshore ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 2,515 Price 65.00 Price currency NOK Net debt (mill.) 8,182 Reporting currency NOK Enterprise Value (mill.) 10,697 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 2,519 2,614 3,044 3,288 3,495 3,755 3,675 EBIT (Operating Income) (mill.) 452 316 163 867 1,004 1,283 1,223 Net Income (mill.) 1,027 48-362 377 491 755 646 Price/Earnings 3.7 27.0-15.4 12.1 3.1 3.7 Price/Book Value 0.9 1.0 0.7 0.8 0.9 0.5 0.4 EV/EBIT 21.5 42.9 81.0 14.2 12.7 9.3 9.2 Return on Equity (%) 24.8 1.1-8.0 8.2 10.1 14.6 11.4 Dividend Yield (%) 2.2 1.8 1.9 2.3 3.6 7.6 7.6 45

Subsea 7 Subsea 7 is one of the world s leading global contractors in seabed-to-surface engineering, construction and services to the offshore industry. The company provides technical solutions to enable the delivery of complex projects in all water depths and challenging environments. The subsea construction market is characterised by few competitors and huge complex projects. Order intake is lumpy and typically late cyclical. Current order backlogs are healthy for execution coming years. Slowing E&P spending is postponing projects and there are currently few tenders out for grab. Historically earnings and return on capital have been decent, but dependant on project execution. Subsea 7 is paying dividens and buying back own shares. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Subsea 7 S.A. Subsea 7 S.A. PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 22,737 Price 68.45 Price currency NOK Net debt (mill.) 1,216 Reporting currency USD Enterprise Value (mill.) 23,953 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 2,209 2,369 5,055 6,297 6,297 7,091 6,083 EBIT (Operating Income) (mill.) 308 392 559 756 572 1,013 735 Net Income (mill.) 238 221 391 830 348 742 519 Price/Earnings 3.9 16.8 12.2 9.5 16.3 4.7 6.8 Price/Book Value 2.6 3.5 1.1 1.3 1.0 0.5 0.5 EV/EBIT 7.3 10.8 13.1 11.6 13.3 3.6 5.1 Return on Equity (%) 26.3 19.7 10.4 13.9 5.4 10.0 6.7 Dividend Yield (%) 1.9 0.3 0.0 0.0 0.0 6.0 6.0 46

Superior Energy Superior Energy Services serves the drilling, completion and production-related needs of oil and gas companies worldwide through a diversified portfolio of specialized oilfield services and equipment that are used throughout the economic life cycle of oil and gas wells. Superior is well positioned to profit from the US shale boom. More wells drilled per rig and increasing service intensity is beneficiary for the company`s service and product offering. Wells in general is getting more complex and laterals longer. Earnings and cash flow is on the increase, dividends and buy backs are back on the agenda. 200 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Superior Energy Services, Inc. Superior Energy Services, Inc. PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 2,773 Price 18.22 Price currency USD Net debt (mill.) 1,470 Reporting currency USD Enterprise Value (mill.) 4,243 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 1,449 1,682 2,070 4,568 4,612 4,569 4,679 EBIT (Operating Income) (mill.) 159 199 311 735 460 554 584 Net Income (mill.) -102 82 143 383-111 274 342 Price/Earnings 19.6-18.3 9.3 15.1 10.9 9.9 Price/Book Value 1.5 2.2 1.6 0.8 1.0 0.7 0.7 EV/EBIT 16.0 18.7 12.6 6.6 12.4 7.8 6.8 Return on Equity (%) -8.5 6.7 10.4 13.5-2.7 6.8 7.0 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 1.6 1.6 47

TGS-NOPEC Performance - last 5 years TGS provides global geo-scientific data products and services to the oil and gas industry. TGS invests in multi-client data worldwide that makes up a data library of seismic imaging. A proven asset-light seismic business model. Develops, manages, owns and controls geophysical and geological data. Global market share of 21%. Strong underlying fundamentals and a highreturn business model. Strong cash flows, net cash and 5% dividend yield. A conservative approach to amortization of seismic data ("over"-amortizing). Mitigates financial risk with pre-funding commitments and has a low fixed cost base. The main risk is a sharp slowdown in E&P spending among oil companies and entry of competitors into the industry. Historically much higher margins and ROCE than peers like Dolphin, PGS, EMGS, Polarcus and Spectrum. 250 200 150 100 50 0 des.09 des.10 des.11 des.12 des.13 des.14 TGS-NOPEC Geophysical Company ASA TGS-NOPEC Geophysical Company ASA PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 15,488 Price 150.10 Price currency NOK Net debt (mill.) -1,700 Reporting currency USD Enterprise Value (mill.) 13,788 FX rate (NOK) 1.00 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 478 568 609 932 883 872 804 EBIT (Operating Income) (mill.) 210 227 252 426 441 348 291 Net Income (mill.) 162 156 171 284 269 254 210 Price/Earnings 10.2 14.4 13.0 12.9 10.6 8.6 10.5 Price/Book Value 2.4 2.7 2.5 3.0 2.2 1.5 1.5 EV/EBIT 7.1 8.7 8.2 6.8 5.8 5.5 6.6 Return on Equity (%) 21.6 18.6 17.2 26.9 22.1 18.1 14.1 Dividend Yield (%) 1.4 2.1 4.0 4.1 5.2 6.3 6.6 48

Weatherford Weatherford is a large global provider of products and services that span the drilling, evaluation, completion, production and intervention cycles of oil and natural gas wells. The company can provide the industry with extended products and services, more efficient operations, more powerful research and development capabilities and greater geographic diversity. Weatherford has been through an extensive turnaround process including several profit warnings and accounting issues with the SEC. Cost cutting and disvestitures of non core holdings is still ongoing, improving balance sheet and cash flow. The new Weatherford will be more focused with leading market positions in products and services for production of unconvetional oil and gas. The company is well positioned to profit from the US shale boom. More wells drilled per rig and increasing service intensity is beneficiary for the company`s service and product offering. Wells in general is getting more complex and laterals longer. 180 160 140 120 100 80 60 40 20 Performance - last 5 years 0 des.09 des.10 des.11 des.12 des.13 des.14 Weatherford International plc Weatherford International plc PHLX Oil Service Index TR Oilfield Services/Equipment Market Value (mill.) 8,179 Price 10.57 Price currency USD Net debt (mill.) 8,292 Reporting currency USD Enterprise Value (mill.) 16,471 FX rate (NOK) 7.47 2009 2010 2011 2012 2013 2014E 2015E Sales (mill.) 8,827 10,221 12,990 15,215 15,263 15,174 15,352 EBIT (Operating Income) (mill.) 704 781 1,324 1,163 746 1,699 1,921 Net Income (mill.) 254-108 262-778 -345 822 983 Price/Earnings 19.9 380.0 35.7 - - 10.7 9.5 Price/Book Value 1.4 1.7 1.1 1.1 1.5 1.1 1.0 EV/EBIT 27.7 29.9 13.9 14.6 27.2 9.6 8.0 Return on Equity (%) 2.8-1.1 2.8-8.5-4.1 10.0 10.1 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 49

Atlantica Tender Drilling Atlantica Tender Drilling operates two rigs on term contracts and have two further rigs under construction in the tender support market. The market for tender support units is a niche market characterized by few players, fairly stable rates, less competiton than in the drilling rig market and decent return on invested capital. Performance - last 5 years 160 140 120 100 80 60 40 20 0 des.09 des.10 des.11 des.12 des.13 des.14 Atlantica is a opportunistic play initiated by the Bassoe group. The biggest shareholder is the well respected private equity fund Hictec Vision. The investment proposition is to take delivery of the newbuilds( one contracted), place them on longer term contracts and sell the company or its fleet within the next 2-3 years. Atlantica Tender Drilling Ltd. PHLX Oil Service Index 50

Investment Objective Long term value creation We prefer performing companies, with strong long term prospects, available at favourable prices

Investment Philosophy Performance - prospects - price Performance Operating excellence «Doing good business with bad people simply doesn t work» Warren E. Buffet Prospects Strong competitive position «We don t focus at beating the market short term. We want our holdings to beat their competitors long term» Börje Ekholm Price Favourable valuation «The bitterness of poor quality remains long after the sweetness of a nice price is forgotten» Unknown

Om ODIN Offshore ODIN Offshore är en aktivt förvaltad aktiefond som investerar i företag som huvudsakligen sysslar med olja och gas, bland annat serviceföretag och företag inom utvinning, produktion, förädling, transport och distribution. Fondens långsiktiga mål är att ge högre avkastning än aktiemarknaden för oljeserviceföretag, mätt med fondens referensindex. Fakta om fonden Startår 18.8.2000 Referensindex Basvaluta Philadelphia Stock Exchange Oil Service Index (OSX) NOK Förvaltningsavgift 2 % Tecknings-/inlösenavgift 0 % Minsta teckningsbelopp 500 EUR 53

Om förvaltaren Förvaltare Lars Mohagen kom till ODIN år 2000. Han har förvaltat fonden sedan 1.3.2005. Lars är civilekonom och auktoriserad finansanalytiker med lång erfarenhet av portföljförvaltning och analys av sjöfarts- och offshoresektorn. Utöver sin mångåriga erfarenhet som portföljförvaltare hos ODIN har han även bred erfarenhet som investerare, aktiemäklare och finansanalytiker. 54

Logga in på ODIN Online Klicka här Teckna andelar Klicka här Kundservice 09 4735 5100 info@odin.fi Beställ ODINs nyhetsbrev Klicka här 55

Vi påminner om att Historisk avkastning är ingen garanti för framtida avkastning, som bland annat beror på marknadsutvecklingen, förvaltarens skicklighet, fondens risk samt kostnader för köp och förvaltning. Avkastningen kan bli negativ om aktiekurserna faller. Uttalandena i denna rapport speglar ODINs syn på marknaden vid den tidpunkt då rapporten utarbetats. Vi har använt källor som bedöms vara pålitliga, men vi kan inte garantera att uppgifterna från dessa källor är korrekta eller fullständiga. Anställda hos ODIN Forvaltning AS får handla för egen räkning med flera slags finansiella instrument. Det innebär att anställda hos ODIN Forvaltning AS kan äga värdepapper i företag som omnämns i den här rapporten, liksom andelar i ODINs fonder. Anställdas egenhandel ska följa ODIN Forvaltning AS interna riktlinjer för anställdas egenhandel, som har utarbetats i enlighet med den norska lagen om handel med värdepapper ("verdipapirhandelloven") och Verdipapirfondenes forenings branschstandard. Mer information finns på www.odin.fi/se 56