Q2 2026 SBM Offshore NV Earnings Call

August 6, 2026

Operator: Ladies and gentlemen, thank you for holding and welcome to the SBM Offshore Half Year 2026 Earnings. At this moment, all participants are in a listen-only mode. After the presentation, there will be an opportunity to ask questions by pressing star one one. Just to remind you, this conference is being recorded. I would now like to hand the conference over to Mr. Øivind Tangen. Please go ahead.

Speaker #2: Ladies and gentlemen, thank you for holding, and welcome to the SBM Offshore Half Year 2026 Earnings Call. At this moment, all participants are on listen-only mode.

Speaker #2: After the presentation, there will be an opportunity to ask questions by pressing star 11. Just to remind you, this conference is being recorded. I would now like to hand the conference over to Mr. Oivind Tangen.

Speaker #2: Please go ahead.

Speaker #3: Thank you, operator. Good morning, everyone, and welcome to SBM Offshore's Half Year 2026 earnings call. I am Oivind Tangen, CEO of SBM Offshore, and joining me on the call, as always, is our CFO, Douglas Wood.

Øivind Tangen: Thank you, operator. Good morning, everyone, and welcome to SBM Offshore's Half Year 2026 Earnings Call. I am Øivind Tangen, CEO of SBM Offshore, and joining me on the call, as always, is our CFO, Douglas Wood. Thank you for joining us today and for your continued interest in SBM Offshore. Please take notes of the disclaimer. SBM Offshore entered 2026 with strong momentum, and H1 of the year confirms the strength of our model, disciplined execution, robust client demand, and continued value creation for shareholders. Our strategy continues to deliver profitable growth from our core offshore energy production activities. New order intake, supported by sustained demand for lower carbon, lower cost deepwater infrastructure, and strong project execution, reinforces the resilience of our business. Our Fast4Ward program and disciplined investment in new hulls continue to enhance our competitiveness in a market supported by strong fundamentals.

Speaker #3: Thank you for joining us today and for your continued interest in SBM Offshore. Please take note of the disclaimer. SBM Offshore entered 2026 with strong momentum, and the first half of the year confirms the strength of our model.

Speaker #3: Discipline execution, robust client demand, and continued value creation for shareholders. Our strategy continues to deliver profitable growth from our core offshore energy production activities.

Øivind Tangen: Our strategy continues to deliver profitable growth from our core offshore energy production activities. New order intake, supported by sustained demand for lower carbon, lower cost deepwater infrastructure, and strong project execution, reinforces the resilience of our business. Our Fast4Ward program and disciplined investment in new hulls continue to enhance our competitiveness in a market supported by strong fundamentals.

Speaker #3: New order intake, supported by sustained demand for lower-carbon, lower-cost deep-water infrastructure and strong project execution, reinforces the resilience of our business. Our Fast4Ward program and disciplined investment in new hulls continue to enhance our competitiveness in a market supported by strong fundamentals.

Speaker #3: This performance is translating into value creation. We are expanding our portfolio, strengthening our financial position, delivering on our shareholder return commitments, and supporting clients in developing critical energy infrastructure safely, efficiently, and responsibly.

Øivind Tangen: This performance is translating into value creation. We are expanding our portfolio, strengthening our financial position, delivering on our shareholder return commitments, and supporting clients in developing critical energy infrastructure safely, efficiently, and responsibly. While our priority remains to grow the core, we are also selectively applying our offshore expertise, engineering capabilities, and life cycle knowhow to assess opportunities in the broader ocean infrastructure market. The H1 2026 was marked by strong execution and solid performance across the business. The resilience of our model, combined with the commitment of our teams, enabled us to continue to deliver predictable outcomes in a dynamic environment. Commercial activity was strong. In H1 of the year, we secured the FPSO SEAP 1 and SEAP 2 awards from Petrobras and the FEED contract for ExxonMobil Guyana's Longtail development.

Speaker #3: While I priority remains to grow the core, we are also selectively applying our offshore expertise engineering capabilities and lifecycle know-how to assess opportunities in the broader ocean infrastructure market.

Speaker #3: The first half of 2026 was marked by strong execution and solid performance across the business. The resilience of our model combined with the commitment of our teams enabled us to continue to deliver predictable outcomes in a dynamic environment.

Øivind Tangen: The H1 2026 was marked by strong execution and solid performance across the business. The resilience of our model, combined with the commitment of our teams, enabled us to continue to deliver predictable outcomes in a dynamic environment. Commercial activity was strong. In H1 of the year, we secured the FPSO SEAP 1 and SEAP 2 awards from Petrobras and the FEED contract for ExxonMobil Guyana's Longtail development.

Speaker #3: Commercial activity was strong. In the first six months of the year, we secured the FPSO SEAP 1 and SEAP 2 awards from Petrobras and the feed contract for ExxonMobil Guyana's long-tail development.

Speaker #3: These awards reflect client confidence in our execution capabilities and the continued robustness of our fast-forward program. Together, they strengthen our position in the lower-cost, lower-carbon deep-water market and support our long-term growth ambitions.

Øivind Tangen: These awards reflect client confidence in our execution capabilities and the continued robustness of our Fast4Ward program. Together, they strengthen our position in the lower cost, lower carbon deepwater market, and support our long-term growth ambitions. With the outlook for deepwater developments remaining strong, we ordered an additional Fast4Ward hull. We now have 2 hulls under construction to support ongoing tendering activity, in addition to the hull allocated to ExxonMobil Guyana's Longtail development. Our operational performance is also reflected in our financial results, with directional revenue increasing to $4.9 billion and directional EBITDA reaching $1.3 billion. Supported by strong execution, recent commercial successes, and a robust market outlook, we are increasing our 2026 directional revenue guidance to around $7.6 billion and our directional EBITDA guidance to around $1.9 billion. The long-term fundamentals for deepwater remain attractive.

Speaker #3: With the outlook for deep-water developments remaining strong, we ordered an additional Fast4Ward hull. We now have two hulls under construction to support ongoing tendering activity, in addition to the hull allocated to ExxonMobil Guyana's Longtail development.

Speaker #3: Our operational performance is also reflected in our financial results, with directional revenue increasing to 4.9 billion dollars and directional EBITDA reaching 1.3 billion dollars.

Øivind Tangen: Our operational performance is also reflected in our financial results, with directional revenue increasing to $4.9 billion and directional EBITDA reaching $1.3 billion. Supported by strong execution, recent commercial successes, and a robust market outlook, we are increasing our 2026 directional revenue guidance to around $7.6 billion and our directional EBITDA guidance to around $1.9 billion. The long-term fundamentals for deepwater remain attractive.

Speaker #3: Supported by strong execution, recent commercial successes, and a robust market outlook, we are increasing our 2026 directional revenue guidance to around $7.6 billion and our directional EBITDA guidance to around $1.9 billion.

Speaker #3: The long-term fundamentals for deep water remain attractive. Growing global energy needs continue to support demand for oil and gas, while production from existing fields naturally declines.

Øivind Tangen: Growing global energy needs continue to support demand for oil and gas while production from existing fields naturally declines. Substantial new developments will therefore be required to help bridge the global supply-demand gap. Deepwater is well-positioned to meet this demand. It combines attractive economics with break-even costs around $20 to $35 per barrel and lower emission intensity than many other sources of oil production. This makes deepwater one of the most competitive sources for future oil and gas supply. As a result, we continue to see strong client demand for large-scale offshore developments. Industry forecasts indicate that the deepwater could account for approximately 30% of new oil production volumes up to 2030, reinforcing our confidence in the long-term outlook for the FPSO market and SBM Offshore's growth opportunities. Deepwater projects provide safe, reliable, and affordable energy and are attracting an increasing share of upstream investment.

Speaker #3: Substantial new developments will therefore be required to help bridge the global supply-demand gap. Deepwater is well positioned to meet this demand. It combines attractive economics with breakeven costs around $20 to $35 per barrel, and lower emission intensity than many other sources of oil production.

Speaker #3: This makes deep water one of the most competitive sources for future oil and gas supply. As a result, we continue to see strong client demand for large-scale offshore developments.

Øivind Tangen: As a result, we continue to see strong client demand for large-scale offshore developments. Industry forecasts indicate that the deepwater could account for approximately 30% of new oil production volumes up to 2030, reinforcing our confidence in the long-term outlook for the FPSO market and SBM Offshore's growth opportunities. Deepwater projects provide safe, reliable, and affordable energy and are attracting an increasing share of upstream investment.

Speaker #3: Industry forecasts indicate that the deep water could account for approximately 30 percent of new oil production volumes up to 2030, reinforcing our confidence in the long-term outlook for the FPSO market and SBM Offshore's growth opportunities.

Speaker #3: Deep water projects provide safe, reliable, and affordable energy and are attracting an increasing share of upstream investment. Major operators continue to prioritize offshore developments with around 80 percent of their exploration expenditure budgets directed towards deep water.

Øivind Tangen: Major operators continue to prioritize offshore developments with around 80% of their exploration expenditure budgets directed towards deepwater. Over the next three years, we see a pipeline of more than 40 potential FPSO awards globally, including approximately 16 opportunities that align well with our expertise in large-scale deepwater FPSOs. These projects are concentrated in our core market around the Atlantic Basin, including Brazil, Guyana, Mexico, and West Africa. Gas is also becoming a more important element in our new FPSO designs, creating additional opportunities. Larger gas volumes increase topside complexity from gas processing to reinjection or export for domestic use onshore. Our proven track record in managing large gas volumes strengthens our position in this growing segment. Next, to highlight one of the key milestones of the H1, the award of the SEAP one and SEAP two FPSO contracts from Petrobras in the new basin.

Speaker #3: Over the next three years, we see a pipeline of more than 40 potential FPSO awards globally, including approximately 16 opportunities that align well with our expertise in large-scale, deep-water FPSOs.

Speaker #3: These projects are concentrated in our core market around the Atlantic Basin, including Brazil, Guyana, Mexico, and West Africa. Gas is also becoming a more important element in our new FPSO designs, creating additional opportunities.

Øivind Tangen: Gas is also becoming a more important element in our new FPSO designs, creating additional opportunities. Larger gas volumes increase topside complexity from gas processing to reinjection or export for domestic use onshore. Our proven track record in managing large gas volumes strengthens our position in this growing segment. Next, to highlight one of the key milestones of the H1, the award of the SEAP one and SEAP two FPSO contracts from Petrobras in the new basin.

Speaker #3: Larger gas volumes increase topside complexity, from gas processing to re-injection or export for domestic use onshore. Our proven track record in managing large gas volumes strengthens our position in this growing segment.

Speaker #3: Next, to highlight one of the key milestones of the first half: the award of the SEAP 1 and SEAP 2 FPSO contracts from Petrobras in the new basin.

Speaker #3: These awards follow the demanding tender process and demonstrate the competitiveness of our offering. They add significant value to our backlog and reinforce our position in Brazil, a strategic deepwater region.

Øivind Tangen: These awards follow the demanding tender process and demonstrate the competitiveness of our offerings. They add significant value to our backlog and reinforce our position in Brazil, a strategic deepwater region. These FPSOs are large, technically complex units with sophisticated gas treatment facilities that enable pipeline-quality gas export to shore. They are clear proof points of the industry trend where the monetization of gas is becoming an increasingly important part of deepwater developments. Given this level of complexity, our standardized Fast4Ward program is key to the de-risking of execution while maintaining cost efficiency. The replication of our in-house design across these design one, build two projects improves execution efficiency, enhances schedule certainty, and supports disciplined delivery. This is what Fast4Ward is designed to deliver. Lower execution risk, stronger cost discipline, and improved schedule certainty through standardization and repeatability.

Speaker #3: These FPSOs are large, technically complex units with sophisticated gas treatment facilities that enable pipeline-quality gas export to shore. They are clear proof points of the industry trend, where the monetization of gas is becoming an increasingly important part of deep-water developments.

Speaker #3: Given this level of complexity, our standardized fast-forward program is key to de-risking execution while maintaining cost efficiency. The replication of our in-house design across these designs...

Øivind Tangen: Given this level of complexity, our standardized Fast4Ward program is key to the de-risking of execution while maintaining cost efficiency. The replication of our in-house design across these design one, build two projects improves execution efficiency, enhances schedule certainty, and supports disciplined delivery. This is what Fast4Ward is designed to deliver. Lower execution risk, stronger cost discipline, and improved schedule certainty through standardization and repeatability.

Speaker #3: Building two projects improves execution efficiency, enhances schedule certainty, and supports disciplined delivery. This is what Fast-Forward is designed to deliver: lower execution risk, stronger cost discipline, and improved schedule certainty through standardization and repeatability.

Speaker #3: Let me now explain how SBM can scale execution capacity for further growth while already managing five projects in execution. Large FPSO projects typically take around four years to deliver.

Øivind Tangen: Let me now explain how SBM can scale execution capacity for further growth while already managing five projects in execution. Large FPSO projects typically take around four years to deliver. Given their increasing size and scope, there is limited room to shorten delivery timelines materially. However, we have clear levers to grow beyond our stated in-house capacity of six FPSOs in parallel while keeping the same core organization and execution discipline. Standardization is central to this approach. A standardized design allows us to enter projects with greater at contract award, reducing complexity and optimizing engineering scope during execution. At the same time, strategic relationships and early engagement with suppliers and yards allow us to order long lead times in advance, improving predictability and supporting on-time delivery at scale. Replication is another important enabler. Some clients adopt a design one, build many approach.

Speaker #3: Given their increasing size and scope, there is limited room to shorten delivery timelines materially. However, we have clear levers to grow beyond our stated in-house capacity of six FPSOs in parallel while keeping the same core organization and execution discipline.

Speaker #3: Standardization is central to this approach. A standardized design allows us to enter projects with greater maneuver than contract award, reducing complexity and optimizing engineering scope during execution.

Øivind Tangen: A standardized design allows us to enter projects with greater at contract award, reducing complexity and optimizing engineering scope during execution. At the same time, strategic relationships and early engagement with suppliers and yards allow us to order long lead times in advance, improving predictability and supporting on-time delivery at scale. Replication is another important enabler. Some clients adopt a design one, build many approach.

Speaker #3: At the same time, strategic relationships and early engagement with suppliers and yards allow us to order long lead times in advance, improving predictability and supporting on-time delivery at scale.

Speaker #3: Replication is another important enabler. Some clients adopt a "design one, build many" approach. Combined with the systematic application of lessons learned, this creates design, engineering, and procurement synergies across multiple projects.

Øivind Tangen: Combined with the systematic application of lessons learned, this creates design, engineering, and procurement synergies across multiple projects. It reduces scope, improves efficiency, and allows us to deliver more projects with the same core organization. Partnerships also expand our execution capacity beyond the core organization. Standardization is critical here because standardized work scopes, whether in detailed engineering or topside construction, are easier to place with trusted strategic partners. By remaining disciplined on what we outsource, we can expand capacity while maintaining the quality and consistency of our delivery model. Together, these enablers allow us to scale execution capacity and support further growth in a strong market. In our turnkey portfolio, we are making good progress across five major projects under construction, and we have a well-phased execution plan extending into the next decade. FPSO Jaguar for ExxonMobil is the most advanced, with first oil expected in 2027.

Speaker #3: It reduces scope, improves efficiency, and allows us to deliver more projects with the same core organization. Partnerships also expand our execution capacity beyond the core organization.

Speaker #3: Standardization is critical here, because standardized work scopes, whether in detailed engineering or topside construction, are easier to place with trusted strategic partners. By remaining disciplined on what we outsource, we can expand capacity while maintaining the quality and consistency of our delivery model.

Øivind Tangen: By remaining disciplined on what we outsource, we can expand capacity while maintaining the quality and consistency of our delivery model. Together, these enablers allow us to scale execution capacity and support further growth in a strong market. In our turnkey portfolio, we are making good progress across five major projects under construction, and we have a well-phased execution plan extending into the next decade. FPSO Jaguar for ExxonMobil is the most advanced, with first oil expected in 2027.

Speaker #3: Together, these enablers allow us to scale execution capacity and support further growth in a strong market. In our turnkey, portfolio, we are making good progress across five major projects under construction, and we have a well-phased execution plan extending into the next decade.

Speaker #3: FPSO Jaguar for ExxonMobil is the most advanced, with first oil expected in 2027. FPSO Ground Morgue for TotalEnergies and FPSO Chalchi for Woodside are both more than 50 percent complete, while the two SEAP units for Petrobras are progressing through the early execution phase with contractual handover expected in 2030 and 2031.

Øivind Tangen: FPSO GranMorgu for TotalEnergies and FPSO Chalchi for Woodside are both more than 50% complete, while the two SEAP units for Petrobras are progressing through the early execution phase, with contractual handover expected in 2030 and 2031. This phased delivery profile supports disciplined growth. GranMorgu is being delivered in partnership with Technip Energies. Chalchi has limited topside scope with a disconnectable turret buoy completed and on its way to Mexico for installation. The SEAP projects benefit from design replication, improving engineering and procurement efficiency. Looking beyond the current portfolio, the market outlook remains attractive. Our investment in three Fast4Ward hulls, one of which has already been allocated to the Longtail development, together with future slot options we maintain with key yards, gives us flexibility to support future client demand while maintaining schedule certainty.

Speaker #3: This phase delivery profile supports discipline growth. Ground Morgue is being delivered in partnership with Technip Energies. Chalchi has limited topside scope, with a disconnectable turret buoy completed and on its way to Mexico for installation. The SEAP projects benefit from design replication, improving engineering and procurement efficiency.

Øivind Tangen: The SEAP projects benefit from design replication, improving engineering and procurement efficiency. Looking beyond the current portfolio, the market outlook remains attractive. Our investment in three Fast4Ward hulls, one of which has already been allocated to the Longtail development, together with future slot options we maintain with key yards, gives us flexibility to support future client demand while maintaining schedule certainty.

Speaker #3: Looking beyond the current portfolio, the market outlook remains attractive. Our investment in three Fast4Ward hulls, one of which has already been allocated to the long-tail development, together with future slot options we maintain with key yards, gives us flexibility to support future client demand while maintaining schedule certainty.

Speaker #3: On the operations side, our fleet continues to perform exceptionally well, with uptime around 99 percent across 16 operating units, demonstrating the consistency and robustness of our assets.

Øivind Tangen: On the operations side, our fleet continues to perform exceptionally well, with uptime around 99% across 16 operating units, demonstrating the consistency and robustness of our assets. Today, SBM Offshore is the largest FPSO contractor by oil production capacity, producing about two million barrels of oil equivalents per day, around 17% of total deepwater production or 2% of total global production. Our focus remains on safe and reliable operations while continuously identifying opportunities to enhance performance across the fleet. By systematically applying lessons learned, we continue to improve asset performance and unlock additional production potential. This has supported successful debottlenecking on recent units in Guyana and Brazil, where we are achieving production records and delivering around 140,000 barrels of additional oil production above initial nameplate capacity, accelerating value creation for our clients. We also continue to unlock value from our portfolio.

Speaker #3: Today, SBM Offshore is the largest FPSO contractor by oil production capacity. Producing about 2 million barrels of oil equivalents per day around 17 percent of total deep-water production, or 2 percent of total global production.

Speaker #3: Our focus remains on safe and reliable operations, while continuously identifying opportunities to enhance performance across the fleet. By systematically applying lessons learned, we continue to improve asset performance and unlock additional production potential.

Øivind Tangen: By systematically applying lessons learned, we continue to improve asset performance and unlock additional production potential. This has supported successful debottlenecking on recent units in Guyana and Brazil, where we are achieving production records and delivering around 140,000 barrels of additional oil production above initial nameplate capacity, accelerating value creation for our clients. We also continue to unlock value from our portfolio.

Speaker #3: This has supported successful debottlenecking on recent units in Guyana and Brazil, where we are achieving production records and delivering around 140,000 barrels of additional oil production above initial nameplate capacity, accelerating value creation for our clients.

Speaker #3: We also continue to unlock value from our portfolio. During the first half of the year, we completed the sale of FPSO 1 Guyana and finalized the divestment of a minority interest in FPSO Chalchi.

Øivind Tangen: During H1 of the year, we completed the sale of FPSO ONE GUYANA and finalized the divestment of a minority interest in FPSO Chalchi. In Angola, we continue to see opportunities to extend asset lives. We recently received a notification letter for a two-year extension of the N'Goma FPSO, and we have started brownfield work related to the extensions of FPSOs Mondo and Saxi Batuque, further strengthening our long-standing positioning in the country. Looking ahead, we see additional opportunities to enhance fleet performance through operational data. By combining operational excellence with data-driven insights, we continue to improve reliability, efficiency, and value creation across the fleet. We have built a digital ecosystem that connects offshore teams, workflows, remote support functions, and operational data. By bringing together people, processes, and data, we can identify opportunities earlier, improve planning and decision-making, and apply lessons learned across the fleet.

Speaker #3: In Angola, we continue to see opportunities to extend asset lives. We recently received a notification letter for a two-year extension of the Angoma FPSO, and we have started brownfield work related to the extensions of FPSOs Mondo and Saxibatuk.

Speaker #3: Further strengthening our long-standing positioning in the country. Looking ahead, we see additional opportunities to enhance fleet performance through operational data. By combining operational excellence with data-driven insights, we continue to improve reliability, efficiency, and value creation across the fleet.

Øivind Tangen: Looking ahead, we see additional opportunities to enhance fleet performance through operational data. By combining operational excellence with data-driven insights, we continue to improve reliability, efficiency, and value creation across the fleet. We have built a digital ecosystem that connects offshore teams, workflows, remote support functions, and operational data. By bringing together people, processes, and data, we can identify opportunities earlier, improve planning and decision-making, and apply lessons learned across the fleet.

Speaker #3: We have built a digital ecosystem that connects offshore teams' workflows, remote support functions, and operational data. By bringing together people, processes, and data, we can identify opportunities earlier, improve planning and decision-making, and apply lessons learned across the fleet.

Speaker #3: This supports more targeted predictive maintenance and asset integrity, strengthening performance throughout the asset lifecycle. In parallel, we continue to deploy technologies that support smarter and safer operations.

Øivind Tangen: This supports more targeted predictive maintenance and asset integrity, strengthening performance throughout the asset lifecycle. In parallel, we continue to deploy technologies that support smarter and safer operations. Robotics are becoming increasingly important for asset inspection and maintenance, including confined spaces, tanks, and hull inspections. These technologies reduce exposure to higher risk environments, improve inspection quality and consistency, and support more efficient maintenance planning. Beyond our core FPSO business, we are selectively applying the capabilities built over decades of offshore experience to address global challenges through ocean infrastructure solutions. As land-based solutions face increasing constraints, offshore infrastructure offers growing potential. Modularity, standardization, and scalability make the ocean an attractive platform for deploying proven technologies at scale and in new environments. By leveraging our expertise in offshore design, execution, and operations, SBM Offshore is well positioned to enable proven industrial technologies offshore.

Speaker #3: Robotics are becoming increasingly important for asset inspection and maintenance, including confined spaces, tanks, and hull inspections. These technologies reduce exposure to higher-risk environments, improve inspection quality, and consistency, and support more efficient maintenance planning.

Speaker #3: Beyond our core FPSO business, we are selectively applying the capabilities built over decades of offshore experience to address global challenges through ocean infrastructure solutions.

Øivind Tangen: Beyond our core FPSO business, we are selectively applying the capabilities built over decades of offshore experience to address global challenges through ocean infrastructure solutions. As land-based solutions face increasing constraints, offshore infrastructure offers growing potential. Modularity, standardization, and scalability make the ocean an attractive platform for deploying proven technologies at scale and in new environments. By leveraging our expertise in offshore design, execution, and operations, SBM Offshore is well positioned to enable proven industrial technologies offshore.

Speaker #3: As land-based solutions face increasing constraints, offshore infrastructure offers growing potential. Modularity, standardization, and scalability make the ocean an attractive platform for deploying proven technologies at scale and in new environments.

Speaker #3: By leveraging our expertise in offshore design, execution, and operations, SBM Offshore is well-positioned to enable proven industrial technologies offshore. One example is our partnership with Veolia to develop a floating desalination solution.

Øivind Tangen: One example is our partnership with Veolia to develop a floating desalination solution, combining Veolia's water treatment expertise with our ocean infrastructure and operating experience. With more than 60 years of offshore experience and a strong track record in standardization and lifecycle management, SBM Offshore can act as an offshore enabler of technology solutions in areas such as carbon capture, power, ammonia, and freshwater. At the same time, we remain disciplined in capital allocation, risk management, and the opportunities we pursue. With that, I will now hand it over to Douglas for the financials.

Speaker #3: Combining Veolia's water treatment expertise with our ocean infrastructure and operating experience. With more than 60 years of offshore experience and a strong track record in standardization and lifecycle management, SBM Offshore can act as an offshore enabler of technology solutions in areas such as carbon capture, power, ammonia, and freshwater.

Speaker #3: At the same time, we remain disciplined in capital allocation, risk management, and the opportunities we pursue. With that, I will now hand it over to Douglas for the financials.

Speaker #2: Thank you, Oivind, and good morning, everybody. So, as you've heard, we've delivered a strong set of results for the first half. And that's thanks to the performance of the project portfolio, the fleet, including the impact of the three large vessels we started up last year, and of course, the sale of one Guyana and a share in the FSO Chalchi.

Douglas Wood: Thank you, Øivind, and good morning, everybody. As you've heard, we've delivered a strong set of results for the H1, and that's thanks to the performance of the project portfolio, the fleet, including the impact of the three large vessels we started up last year, and of course, the sale of One Guyana and a share in the FSO Chalchi. This great performance from our teams in executing our existing portfolio drives the increase in EBITDA guidance from around $1.8 billion to around $1.9 billion. For revenue guidance, the S&O awards and the Chalchi divestment drive the significant increase in guidance from about $6.9 billion to around $7.6 billion. While these awards won't get past the 25% completion stage and impact EBITDA this year, obviously, as you'll see from the backlog, that's to come.

Speaker #2: Now, this great performance from our teams in executing our existing portfolio drives the increase in EBITDA guidance from around $1.8 billion to around $1.9 billion.

Speaker #2: Then, for revenue guidance, the SEAP awards and the Chalchi divestment drive the significant increase in guidance from above $6.9 billion to around $7.6 billion.

Douglas Wood: For revenue guidance, the S&O awards and the Chalchi divestment drive the significant increase in guidance from about $6.9 billion to around $7.6 billion. While these awards won't get past the 25% completion stage and impact EBITDA this year, obviously, as you'll see from the backlog, that's to come.

Speaker #2: Now, while these awards won't get past the 25 percent completion stage and impact EBITDA this year, obviously, as you'll see from the backlog, that's to come.

Speaker #2: And on top of this, the FEED activity we have in hand, plus the market outlook, speak to the further strong cash and margin potential.

Douglas Wood: On top of this, the FEED activity we have in hand, plus the market outlook speak to the further strong cash and margin potential. On the backlog, this increased to a record $35.6 billion, with the S&O awards offsetting significant consumption over the H1, where we had the One Guyana and Chalchi divestments on top of the strong underlying operational performance. We expect to generate around $8 billion from the backlog on a net cash basis. Net debt was $3.7 billion, lower than year-end, driven by the sale of One Guyana and repayment of the associated financing. This leads to a pro forma leverage ratio of around 1.6x EBITDA, based on the rolling last 12 months EBITDA.

Speaker #2: On the backlog, this increased to a record $35.6 billion, with the SEAP awards offsetting significant consumption over the first half, where we had the one Guyana and Chalchi divestments on top of the strong underlying operational performance.

Speaker #2: And then we expect to generate around $8 billion from the backlog on a net cash basis. Net debt was $3.7 billion, lower than year-end, driven by the sale of One Guyana and repayment of the associated financing.

Douglas Wood: We expect to generate around $8 billion from the backlog on a net cash basis. Net debt was $3.7 billion, lower than year-end, driven by the sale of One Guyana and repayment of the associated financing. This leads to a pro forma leverage ratio of around 1.6x EBITDA, based on the rolling last 12 months EBITDA.

Speaker #2: Now, this leads to a pro forma leverage ratio of around 1.6 times EBITDA based on the rolling last 12 months’ EBITDA. As we've mentioned in the past, construction financing that we had in place for Jaguar, and likely Longtail and Salem, along with temporary working capital movements, will mean this will fluctuate a bit, but the long-term trend is the structurally lower leverage.

Douglas Wood: As we've mentioned in the past, construction financing that we had in place for FPSO Jaguar and likely Longtail and sale and operate temporary working capital movements will mean this will fluctuate a bit, but the long-term trend is for structurally lower leverage. Finally, we paid the $100 million 2025 dividend in May and are formally reconfirming today the identical $100 million interim dividend for 2026 to be paid in September. This, together with the ongoing $270 million equivalent buyback program, means we're on track relative to delivering a minimum $2.1 billion aggregate return for the six years 2026 to 2031 inclusive, with the anticipated upside potential materializing as we secure new awards. Next, to review the financials in a little bit more detail, starting with the backlog. This was, as I mentioned, $35.6 billion. It's an increase of around $4.5 billion versus the year-end.

Speaker #2: Finally, we paid the $100 million 2025 dividend in May, and are formally reconfirming today the identical $100 million interim dividend for 2026, to be paid in September.

Speaker #2: And this, together with the ongoing 270 million dollar equivalent buyback program, means we're on track relative to delivering a minimum 2.1 billion dollar aggregate return for the six years 2026 to 2031 inclusive.

Douglas Wood: This, together with the ongoing $270 million equivalent buyback program, means we're on track relative to delivering a minimum $2.1 billion aggregate return for the six years 2026 to 2031 inclusive, with the anticipated upside potential materializing as we secure new awards. Next, to review the financials in a little bit more detail, starting with the backlog. This was, as I mentioned, $35.6 billion. It's an increase of around $4.5 billion versus the year-end.

Speaker #2: With the anticipated upside potential materializing as we secure new awards. Next, to review the financials in a little bit more detail, starting with the backlog.

Speaker #2: But this was, as I mentioned, 35.6 billion dollars to an increase of around 4.5 billion dollars versus the year-end. So the addition of the two SEAP awards more than offset the consumption from the strong operational performance over the first half and the impacts from the sale of one Guyana and a share in FSO Chalchi.

Douglas Wood: The addition of the two SAIP awards more than offset the consumption from the strong operational performance over the H1 and the impacts from the sale of OneGuyana and a share in FSO Chalchi. On net debt, the OneGuyana sale resulted in a significant decrease in leverage. Total revenue was around $4.9 billion, compared with around $2.3 billion for the H1 2025. The biggest contributor to revenue was turnkey, above $3.7 billion, compared with around $1.3 billion in the year ago period. The main driver of the increase was the sale of OneGuyana. On the lease and operate side, revenue was around $1.2 billion versus around $1 billion for the H1 2025. Here, the increase was driven by the contribution of the three large vessels that joined the fleet over the course of last year.

Speaker #2: On net debt, the one Guyana sale resulted in a significant decrease in leverage. The total revenue was around $4.9 billion, compared with around $2.3 billion for the first half of 2025.

Speaker #2: The biggest contributor to revenue was Turnkey, above $3.7 billion, compared with around $1.3 billion in the year-ago period. And the main driver of the increase was the sale of ONE Guyana.

Douglas Wood: The biggest contributor to revenue was turnkey, above $3.7 billion, compared with around $1.3 billion in the year ago period. The main driver of the increase was the sale of OneGuyana. On the lease and operate side, revenue was around $1.2 billion versus around $1 billion for the H1 2025. Here, the increase was driven by the contribution of the three large vessels that joined the fleet over the course of last year.

Speaker #2: On the lease and operate side, revenue was around $1.2 billion versus around $1 billion for the first half of 2025. Here, the increase was driven by the contribution of the three large vessels that joined the fleet over the course of last year.

Speaker #2: Now, turning to EBITDA, this was over $1.3 billion, almost double the year-ago period. And this increase was driven by Turnkey, where EBITDA was $813 million.

Douglas Wood: Now turning to EBITDA, this was over $1.3 billion, almost double the year ago period. This increase was driven by turnkey, where EBITDA was $813 million. That's up by almost $600 million compared to the year ago period. The main driver, again, being the OneGuyana sale. Lease and operate EBITDA was around $547 million, compared with around $500 million in the year ago period. Again, that was mainly due to the contribution of the three new vessels, the impact of which, on an EBITDA basis, was partially offset by the fact Åsgard A and Thunder Hawk left the fleet at the end of last year, plus the comparative impact of the gain on sale of Teekay we saw in the H1 2025. Finally, other EBITDA was around $ -50 million.

Speaker #2: That's up by almost 600 million dollars, compared with the year ago period. The main driver, again, being the one Guyana sale. Lease and operate EBITDA was around 547 million dollars, compared with around 500 million dollars in the year ago period.

Speaker #2: Again, that was mainly due to the contribution of the three new vessels. The impact of which on an EBITDA basis was partially offset by the fact assaying and underhook left the fleet at the end of last year, plus the comparative impact of the gain on sale of TK we saw in the first half 2025.

Douglas Wood: Again, that was mainly due to the contribution of the three new vessels, the impact of which, on an EBITDA basis, was partially offset by the fact Åsgard A and Thunder Hawk left the fleet at the end of last year, plus the comparative impact of the gain on sale of Teekay we saw in the H1 2025. Finally, other EBITDA was around $ -50 million.

Speaker #2: Finally, other EBITDA was around negative $50 million, which is an increase versus around negative $40 million last year. This is a result of higher G&A costs to support growth activity.

Douglas Wood: It's an increase versus around $ -40 million last year as a result of higher G&A costs to support growth activity. Now next, we're reconfirming the direction of travel on deleveraging. We foresee our leverage ratio staying below three times going forward. We could see some upward movement this year from the pro forma H1 number as we draw down debt on FPSO Jaguar and Chalchi, also depending on the timing of receipt of some large milestone payments relative to project progress at the year-end cut-off point. That's a facet of the sale and operate model being that we can see some large but temporary movements in working capital, which can then obviously impact net debt. Again, we see the trend staying below three times. Turning to cash and the backlog on a net cash basis. This stood at around $8 billion.

Speaker #2: And next, we're reconfirming the direction of travel on deleveraging. We foresee our leverage ratio staying below three times going forward, but we could see some upward movement this year from the pro forma H1 number, as we draw down debt on Jaguar and Chalchi, and also depending on the timing of receipt of some large milestone payments relative to project progress at the year-end cutoff point.

Speaker #2: And that's a facet of the sale and operate model being that we can see some large, but temporary movements in working capital, which can then obviously impact net debt.

Douglas Wood: That's a facet of the sale and operate model being that we can see some large but temporary movements in working capital, which can then obviously impact net debt. Again, we see the trend staying below three times. Turning to cash and the backlog on a net cash basis. This stood at around $8 billion.

Speaker #2: But again, we see the trend staying below three times. Turning to cash and the backlog, on a net cash basis, this stood at around $8 billion.

Speaker #2: As highlighted in the chart we showed at year-end, the sale of ONE GUYANA drove significant consumption during the period. Now, while the impact of the SEAP awards was more than enough to offset this on a net cash basis, we also have an impact from the deconsolidation of the share of the lease and operate cash flow of FSO Chalchi sold to partners, which meant we ended up a little lower than year-end.

Douglas Wood: As highlighted in the chart we showed at year-end, the sale of ONE GUYANA drove significant consumption during the period. While the impact of the SAIP awards was more than enough to offset this on a net cash basis, we also had an impact from the deconsolidation of the share of the lease and operate cash flow of FSO Chalchi sold to partners, which meant we ended up a little lower than year-end. This illustrates something it's important to bear in mind for the backlog linked to the sale and operate model. Thanks to the SAIP awards, the turnkey net cash backlog has more than doubled to $1 billion. This boosts the near-term cash, and that's very clear as you can see in the chart.

Speaker #2: Now, this illustrates something it's important to bear in mind for the backlog linked to the Sale and Operate model. Thanks to the SEAP awards, the Turnkey net cash backlog has more than doubled to $1 billion.

Speaker #2: Now, this boosts the near-term cash, and that's very clear as you can see in the chart. Now, while the NPVs for sale and operate and lease and operate projects are similar, in absolute net cash terms, the same award on a lease and operate basis is much higher as the cash comes much later.

Douglas Wood: While the NPVs for sale and operate and lease and operate projects are similar in absolute net cash terms, the same award on a lease and operate basis is much higher as the cash comes much later. That's why the sale of a portion of the 20-year Chalchi project has a relatively material impact. However, given ongoing FEED activity and the market outlook, we're optimistic we could see an increase at year-end. Looking more at the charts on the page, we've played out the blue bar on the left, which includes turnkey and lease and operate over time in dark blue on the right-hand chart.

Speaker #2: So that's why the sale of a portion of the 20-year Chalchi project has a relatively material impact. However, given ongoing FEED activity and the market outlook, we're optimistic we could see an increase at year-end.

Speaker #2: Then, looking more at the charts on the page, we've played out the blue bar on the left, which includes Turnkey and lease and operate.

Speaker #2: Over time, in dark blue on the right-hand chart. And we have average net cash over four-year cycles, as sale and operate transactions can have a material impact in the early years and introduce significant year-on-year volatility.

Douglas Wood: We have average net cash over 4-year cycles as sale and operate transactions can have a material impact in the early years and introduce significant year-on-year volatility, making a multi-year average a more representative measure of underlying cash performance. As the backlog already includes the two new SEAP awards, we've then adjusted the light blue modeled scenario from February, showing two large FPSO awards for the next 6 years, up to 2031 accordingly. The scenario now has 10 rather than 12 FPSOs. It's important to note here we're not planning on shutting up shop and running down the business in 6 years, and are confident of more to come thereafter from FPSO awards, but also from diversification into other ocean infrastructure solutions over time. We've therefore maintained further illustrative waves of awards to the right of the modeled near-term scenario.

Douglas Wood: We have average net cash over four-year cycles as sale and operate transactions can have a material impact in the early years and introduce significant year-on-year volatility, making a multi-year average a more representative measure of underlying cash performance. As the backlog already includes the two new SEAP awards, we've then adjusted the light blue modeled scenario from February, showing two large FPSO awards for the next six years, up to 2031 accordingly. The scenario now has 10 rather than 12 FPSOs. It's important to note here we're not planning on shutting up shop and running down the business in six years, and are confident of more to come thereafter from FPSO awards, but also from diversification into other ocean infrastructure solutions over time. We've therefore maintained further illustrative waves of awards to the right of the modeled near-term scenario.

Speaker #2: Making a multi-year average a more representative measure of underlying cash performance. And as the backlog already includes the two new SEAP awards, we've then adjusted the light blue modeled scenario from February showing two large FPSO awards for the next six years up to 2031 accordingly.

Speaker #2: So the scenario now has 10, rather than 12, FPSOs. Again, it's important to note here that we're not planning on shutting up shop and running down the business in six years.

Speaker #2: And our confidence of more to come thereafter from FPSO awards, but also from diversification into other ocean infrastructure solutions over time. We’ve therefore maintained further illustrative waves of awards to the right of the modeled near-term scenario.

Speaker #2: Then, in the chart on the top right, we have the usual Euro per share analysis of the backlog at a range of discount rates where, again, we've maintained the light blue modeled near-term scenario on top.

Douglas Wood: In the chart on the top right, we have the usual EUR per share analysis of the backlog at a range of discount rates, where again, we've maintained the light blue modeled near-term scenario on top. In looking at capital allocation, as a result of the strong operational performance and the backlog, we remain very much on track to deliver a minimum of $2.1 billion in shareholder returns for the 6 years 2026 to 2031 inclusive. The chart on the left is the same 6-year view as we showed in February for 2026 to 2031 inclusive. We're going to provide a further update for 2027 to 2032 inclusive with the 2026 full-year results. During the course of the year, of the $440 million cash return we intend to pay in 2026, we've already paid $100 million in dividends.

Douglas Wood: In the chart on the top right, we have the usual EUR per share analysis of the backlog at a range of discount rates, where again, we've maintained the light blue modeled near-term scenario on top. In looking at capital allocation, as a result of the strong operational performance and the backlog, we remain very much on track to deliver a minimum of $2.1 billion in shareholder returns for the six years 2026 to 2031 inclusive. The chart on the left is the same six-year view as we showed in February for 2026 to 2031 inclusive. We're going to provide a further update for 2027 to 2032 inclusive with the 2026 full-year results. During the course of the year, of the $440 million cash return we intend to pay in 2026, we've already paid $100 million in dividends.

Speaker #2: And looking at capital allocation, as a result of the strong operational performance and the backlog, we remain very much on track to deliver a minimum of $2.1 billion in shareholder returns for the six years 2026 to 2031 inclusive.

Speaker #2: Now, the chart on the left is the same six-year view as we showed in February for 2026 to 2031 inclusive. We're going to provide a further update for 2027 to 2032 inclusive with the 2026 full-year results.

Speaker #2: During the course of the year, of the 440 million cash return we intend to pay in 2026, we've already paid 100 million in dividends.

Speaker #2: We've repurchased around 3 million shares for $118 million. And we're formally reconfirming the $100 million interim dividend to be paid in September.

Douglas Wood: We've repurchased around 3 million shares for $118 million, and we're formally reconfirming the $100 million interim dividend to be paid in September. The $440 million cash return represents a 7.2% cash yield based on the share price end of June. If you benchmark this for the AEX, this is top quarter. As I mentioned, the 2.1, it's a minimum based on the backlog we had in-hand at the end of 2025. Obviously, since then, we've made very good progress on materializing the upside with the two SEAP awards, and we're working on the FEED for Longtail. We're optimistic our year-end update will reflect further progress, with more to come in future as a result of the strong market outlook. Finally, to cover the details of the guidance update.

Speaker #2: Now, the $440 million cash return represents a 7.2% cash yield based on the share price at the end of June. If you benchmark this for the AEX, this is top quartile.

Speaker #2: Now, as I mentioned, the $2.1 billion is a minimum based on the backlog we had in hand at the end of 2025. But obviously, since then, we've made very good progress on materializing the upside with the two SEAP awards, and we're working on the FEED for Long Tail.

Speaker #2: So, we're optimistic our year-end update will reflect further progress, with more to come in future as a result of the strong market outlook. Finally, to cover the details of the guidance update: 2026 directional revenue guidance is updated from above $6.9 billion to around $7.6 billion, of which around $2.4 billion is expected from the Lease and Operate segment, and around $5.2 billion is expected from the Turnkey segment.

Douglas Wood: 2026 directional revenue guidance is updated from above $6.9 billion to around $7.6 billion, of which around $2.4 billion is expected from the lease and operate segment, and around $5.2 billion expected from the turnkey segment. 2026 directional EBITDA guidance is updated from around $1.8 billion to around $1.9 billion. That's it from me. Now back to Øivind to conclude.

Speaker #2: 2026 directional EBITDA guidance is updated from around $1.8 billion to around $1.9 billion. That's it from me. Now, back to Oivind to conclude.

Speaker #1: Thank you, Douglas. Very clear, as always. And no, we're certainly not planning on shutting up shop. So with that, to conclude, our first half performance demonstrates the resilience of SBM Offshore's lifecycle model and the continued strength of the deep water market, supported by disciplined execution, operational excellence, and commercial momentum.

Øivind Tangen: Thank you, Douglas. Very clear as always. No, we're certainly not planning on shutting up shop. With that, to conclude, our H1 performance demonstrates the resilience of SBM Offshore's life cycle model and the continued strength of the deepwater market, supported by disciplined execution, operational excellence, and commercial momentum. We're growing the core with two new FPSO awards in Brazil and a FEED award in Guyana, reinforcing our position in key deepwater markets. The outlook for deepwater remains strong, and we are well-positioned to capture our share of future opportunities. To support these opportunities, we recently ordered an additional Fast4Ward hull, bringing the total number of hulls under construction to three. These hulls strengthen our ability to respond to client demand while maintaining execution discipline and de-risking delivery schedules.

Speaker #1: We're growing the core with two new FPSO awards in Brazil and a FEED award in Guyana, reinforcing our position in key deepwater markets.

Speaker #1: The outlook for deepwater remains strong, and we're well positioned to capture our share of future opportunities. To support these opportunities, we recently ordered an additional Fast4Ward hull, bringing the total number of hulls under construction to three.

Speaker #1: These hulls strengthen our ability to respond to client demand while maintaining execution discipline and de-risking delivery schedules. Finally, reflecting our execution performance, operational excellence, and recent awards, we have increased our directional revenue and EBITDA guidance for 2026.

Øivind Tangen: Finally, reflecting our execution performance, operational excellence, and recent awards, we have increased our directional revenue and EBITDA guidance for 2026. I would like to thank our clients and stakeholders for their continued trust and support and our teams around the world for their dedication, collaboration, and commitment to delivering our strategy. Thank you all for listening. We will now be happy to answer your questions.

Speaker #1: I would like to thank our clients and stakeholders for their continued trust and support, and our teams around the world for their dedication, collaboration, and commitment to delivering our strategy.

Speaker #1: Thank you all for listening. We will now be happy to answer your questions.

Operator: Ladies and gentlemen, we will start the question and answer session now. To be registered for the question and answer queue, please press star one. If you have a question, please press star one. Go ahead, please. Our first question for today, just one moment, comes from the line of Guilherme Levy from Morgan Stanley. Please go ahead.

Speaker #3: Ladies and gentlemen, we will start the question-and-answer session now. To be registered for the question-and-answer queue, please press star, one, one.

Speaker #3: If you have a question, please press star, one, one. Go ahead, please. Our first question for today: just one moment. Comes from the line of Guillerm Levy from Morgan Stanley.

Speaker #3: Please go ahead.

Guilherme Levy: Hi. Yes, good morning. Thank you for taking my questions. Firstly, perhaps you make the capacity discussion a little bit more concrete. Is there a particular phase of execution that we should think as the actual constraint, engineering, procurement, fabrication? Meaning, if you get awards for the two new unallocated hosts, your headline number of orders will rise to eight rather than the six of stated capacity. Of course, some will be almost complete, others will still be in very early stages, so not necessarily an overlap of stages. Can we think about the six number as something applicable to a specific stage of execution rather than for the whole process? Secondly, on Venus, there is a press article this morning saying that your competitor is now the frontrunner on the negotiations with TotalEnergies.

Speaker #4: Hi, yes, good morning. Thank you for taking my questions. Firstly, perhaps you could make the capacity discussion a little bit more concrete. Is there a particular phase of execution that we should think of as the actual constraint?

Speaker #4: Engineering, procurement, fabrication—meaning, if you get awards for the two new unallocated hulls, your headline number of orders will rise to eight, rather than the six of stated capacity.

Speaker #4: Of course, some will be almost complete, others will still be in very early stages, so not necessarily an overlap of stages. So, can we think about the six number as something applicable to a specific stage of execution, rather than for the whole process?

Speaker #4: And then, secondly, on Venus—there's a press article this morning saying that your competitor is now the front-runner in the negotiations with Total. I know that you normally don't comment on the current state of bids, but perhaps you can tell us a bit about this prospect: what are the main challenges from an engineering execution standpoint, and where do you think you have an edge versus others?

Guilherme Levy: I know that you normally don't comment on the current state of bids, perhaps can you tell us a bit about this prospect? What are the main challenges from an engineering execution standpoint and where you think you have an edge versus others? Thank you.

Speaker #4: Thank you.

Speaker #1: Thank you, and good morning. So, a particular constraint is associated with the work phases of the FPSO. I guess the thing to think about regarding the work phases is that some are done largely in-house, while some are outsourced.

Øivind Tangen: Thank you. Good morning. Particular constraints associated with the work phases of the FPSO. I guess the thing to think about the work phases, some are done largely in-house, some are done outsourced. Typically, our engineering and procurement is in-house. That's where the partnership discussion comes into play, and we have a means of scaling up to add to that capacity constraint as it may be. On the supply chain, equipment deliveries and yards, that is where we have time to plan ahead and look at the prospect pipelines, and as we go through the commercial processes, scale up accordingly. When we communicated in the past, it was the sizing of the organization, the number of projects, project management we could run in parallel.

Speaker #1: So typically, our engineering and procurement is in-house. So that's where the partnership discussion comes into play, and we have a means of scaling up to add to that capacity constraint as it may be.

Speaker #1: On the supply chain, sort of equipment deliveries and yards, that is where we have time to plan ahead and look at the prospect pipelines and, as we go through the commercial processes, scale up accordingly.

Speaker #1: So when we're communicated in the past, it was sort of the sizing of the organization and number of projects, project management we could run in parallel.

Speaker #1: Now, as we go in and have had very successful deliveries over the last few years and standardization is materializing or the learnings from standardization are materializing, we are able to reassess our view on capacity and expand that capacity beyond the six.

Øivind Tangen: Now, as we've gone and have had very successful deliveries over the last few years, and standardization is materializing, or the learnings from standardization are materializing. We are able to reassess our view on capacity and expand that capacity beyond the six. That is always a function of the pipeline ahead and keeping a cost base in the organization that is optimized. We don't see any particular constraints, but in terms of award-based and historical execution models, that's where the six came in. Now we can look beyond that in the same very disciplined way and not compromising on the quality of the execution. When it comes to Venus, I think I've seen many offshore articles on Venus over the last few years. We don't know the outcome of the prospect yet, so beyond that, I don't think we have any further comments.

Speaker #1: So then it's always a function of the pipeline ahead and keeping a cost base in the organization that is optimized. So we don't see any particular constraints, but in terms of award pace and historical execution models, that's where the six came in.

Speaker #1: Now, we can look beyond that in the same very disciplined way, and not compromise on the quality of the execution. When it comes to Venus, I think I've seen many outstanding articles on Venus over the last few years.

Speaker #1: We don't know the outcome of the prospect yet, so beyond that, I don't think we have any further comments. It has no particular technicalities that, compared to others, make it a good fit for our portfolio, but beyond that, I don't have a technical comment on it.

Øivind Tangen: It has no particular technicalities that compared to others, is a good fit for our portfolio, but beyond that, I don't have other technical comments on it.

Speaker #4: Understood. Thank you.

Guilherme Levy: Understood. Thank you.

Speaker #1: Thank you.

Øivind Tangen: Thank you.

Speaker #3: Thank you. We are now going to take our next question, and this one comes from Luc van Beek from Degroof Petercam. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Luuk van Beek from Degroof Petercam. Please go ahead.

Speaker #5: Yes, good morning. First, a question about the statement that you included in your press release on an increasingly complex and volatile environment, as stated for the first time.

Luuk van Beek: Yes, good morning. First, a question about the statement that you included in your press release on an increasingly complex and volatile environment. I see that for the first time. Can you elaborate why you included it? Are there any specific new challenges, for example, in the supply chain? The second question is on the impact of Chalchi on the EBITDA guidance. Is there a significant impact from that? Finally, a question on the taxes, which were very low due to higher deferred tax assets in H1. Can you indicate if there will be any such change in H2?

Speaker #5: So, can you elaborate on why you included it? Are there any specific new challenges, for example, in the supply chain? And the second question is on the impact of Chelsea on the FTA guidance.

Speaker #5: Is there a significant impact from that? And finally, a question on the taxes, which were very low due to higher deferred tax assets in H1.

Speaker #5: Can you indicate if there will be any such change in Q2?

Speaker #1: Okay, thank you, Luc. Good morning. So I'll do the first one, then Douglas will do the other two. We're in a volatile environment; I think we're just observing a world that moves around a lot.

Øivind Tangen: Okay. Thank you, Luuk. Good morning. I'll do the first one. Douglas will do the other two. Volatile environment, I think we're just observing a world that moves around a lot. One could think that that could impact elements of our operational activities or the commercial prospects. We like to think that the predictability of our performance, whether it's operational and financial, is a bit of a contrast to that volatility. We like to emphasize that as a strength in our value proposition. Those are based on the parameters that we've communicated on before. That, I think, is very consistent. I'll leave Douglas to two and three.

Speaker #1: And one could think that that could impact elements of our operational activities or the commercial prospects. So we like to think that the predictability of our performance, whether it's operational and financial, is a bit of a contrast to that volatility.

Speaker #1: And we like to emphasize that as a strength in our value proposition. And those are based on the parameters that we've communicated on before.

Speaker #1: So that's, I think, very consistent. And then I'll lead Douglas to Q2 and Q3.

Speaker #5: Yeah. Morning, Luc. So Chelsea had a small impact but not a very significant impact on EBITDA in the first half. The tax is really about the one Guyana sale, where we've basically already paid the tax.

Douglas Wood: Yeah. Morning, Luuk. Chalchi had a small impact, but not very significant impact on EBITDA in H1. The tax is really about the ONE GUYANA sale where we basically already paid the tax. You have a big lot of income with no associated tax to pay now.

Speaker #5: So you have a large amount of income with no associated tax to pay now. Thank you.

Luuk van Beek: Thank you.

Speaker #3: Thank you. We are now going to move to our next question. This one comes from Philip Gotto from Kepler Cheuvreux. Please go ahead.

Operator: Thank you. We are now going to move to our next question, and this one comes from Philip Ngotho from Kepler Cheuvreux. Please go ahead.

Speaker #5: Yes, good morning. Thank you for taking my questions. I have a few. Maybe just to start with a relatively simple one—just starting to understand the 2026 guidance and the bridge from the H1 EBITDA.

Philip Ngotho: Yes, good morning. Thank you for taking my questions. I have a few. Maybe just to start with a relatively simple one. Just trying to understand the 2026 guidance and the bridge from the H1 EBITDA. Of course, one, Guyana will not be present in H2. You discussed Chalchi just now. Are there any other items that we should be mindful of when looking at modeling H2 EBITDA versus H1? My second question is still on Venus as well. I appreciate it's an ongoing process, and you're also limited in what you can disclose, of course. I was wondering to what extent the competitors in the bidding process are maybe also placing more value on strategic entry into the market and perhaps willing to accept also lower margins. We've been reading on about, of course, possible follow-on orders as well in this region.

Speaker #5: Of course, one Guyana will not be present in H2. You discussed Chelsea just now. Are there any other items that we should be mindful of when looking into modeling H2 EBITDA versus H1?

Speaker #5: Then my second question is still on Venus as well. I appreciate it's an ongoing process, and you are also limited in what you can disclose, of course.

Speaker #5: But I was wondering, to what extent the competitors in the bidding process are maybe also placing more value on strategic entry into the market and perhaps willing to accept also lower margins?

Speaker #5: And we've been reading about, of course, possible follow-on orders as well in the region. So, is winning this first project therefore more important than in other bidding processes?

Philip Ngotho: Is winning this first project, therefore more important than in other bidding processes? My last question is more on working capital going into year-end and net debt evolution. How much should we expect given the whole investments and any additional cost on sale and Longtail, just for modeling purpose for net debt figure?

Speaker #5: And my last question is more on working capital going into year-end and net debt evolution. How much should we expect, given the whole investments?

Speaker #5: And any additional cost on, say, up and long tail? Just for modeling purposes for the net debt figure.

Speaker #1: All right. Let me take Philip. Good morning. Let me take the Venus and then I'll let Douglas take the other two. So as to the commercial strategies of our competitors, I can't really comment, but we've always said that Venus was strategically important to SBM because we would like to be a front-runner in Namibia.

Øivind Tangen: Philip, good morning. Let me take the Venus, and then I'll let Douglas take the other two. As to the commercial strategies of our competitors, I can't really comment. We've always said that Venus was strategically important to SBM because we would like to be a frontrunner in Namibia. I think we see a lot of exploration activities in Namibia, so we'll see how that market evolves from there on. As to when our own gross margins and the discussions around our commercial strategies, we don't compromise on the return expectations on our prospects. There's no singular prospect that will make us shift from our general appetite for returns to our shareholders. We keep our discipline there as we do stay disciplined in the way we operate and run the company.

Speaker #1: I think we see a lot of exploration activities in Namibia, so we'll see how that market evolves from there on. But as to when our own gross margins and the discussions around our commercial strategies, we don't compromise on the return expectations on our prospects.

Speaker #1: So there's no singular prospect that will make us shift from our general appetite for returns to our shareholders. So we keep our discipline there, as we do stay disciplined in the way we operate and run the company.

Speaker #1: So that's as much as I can say about that, I think. And I'll let Douglas talk to working capital and guidance.

Øivind Tangen: That's as much as I can say about that, I think, and I'll let Douglas talk to working capital and guidance.

Speaker #5: Yeah. Hi, Philip. So on the guidance, like as you mentioned, obviously, one Guyana makes a big boost in the first half results. So yeah, unfortunately, the year-end isn't going to be double that, but I think there isn't anything really significant other than needing to maintain a very good operational and project performance.

Douglas Wood: Yeah. Hi, Philip. On the guidance, and like as you mentioned, obviously FPSO ONE GUYANA makes a big boost in the H1 results. Unfortunately the year-end isn't going to be double that. I think there isn't anything really significant other than needing to maintain a very good operational and project performance in terms of the delivery of the around $1.9, where we put the guidance. On the working capital, as I sort of mentioned in the remarks, it's quite hard with the sail and operate project to project exactly because we can see these timing difference between the money we've invested and when we get paid for it by the clients. Especially when you have a cutoff period, it can be like a few weeks between you book the expenditure, and then you get paid for it a bit later.

Speaker #5: In terms of the delivery of the around 1.9 where we've put the guidance. On the working capital, as I sort of mentioned, in the remarks, it's quite hard with the sale and operate project to project exactly because we can see these timing difference between the money we've invested and when we get paid for it by the clients.

Speaker #5: And especially when you have a cutoff period, it can be a few weeks between when you book the expenditure and then you get paid for it a bit later.

Speaker #5: So there can be a bit of volatility there. Underlying, yeah, obviously, we recently announced the new hull, so that's going to be in our working capital.

Douglas Wood: There can be a bit of volatility there. Underlying, obviously we recently announced the Fast4Ward hull, that's going to be in our working capital. There will be some increase associated with that.

Speaker #5: So, that will be some increase associated with that. Okay. Okay. Thank you.

Øivind Tangen: Okay. Thank you.

Speaker #3: Thank you. We are now going to take our next question, and this one comes from Victoria McCulloch from RBC. Please go ahead.

Operator: Thank you. We're now going to take our next question. This one comes from Victoria McCulloch from RBC. Please go ahead.

Speaker #4: Good morning. Thank you very much for your time. Just one question remaining for me. Can you talk a bit about how you've seen the tender pipeline evolve over the past 12 months?

Victoria McCulloch: Good morning. Thank you very much for your time. Just one question remaining from me. Can you talk a bit about how you've seen the tender pipeline evolve over the past 12 months? Obviously, the oil price has changed dramatically. The environment around the world has changed, also it appears the competitive environment has shifted a little bit for you guys. Again, these are long-term projects, decisions aren't made quickly. What are your customers telling you in terms of the tender pipeline, the opportunities, their appetite? Have you seen a shift in delays or any slowdown because it's hard to make decisions in this environment? Are you seeing a continued acceleration as I guess the slides would suggest with the tender pipeline you present? Thanks very much.

Speaker #4: Obviously, the oil price has changed dramatically. The environment around the world has changed. But also, it appears the competitive environment has shifted—a little bit for you guys. But again, these are long-term projects.

Speaker #4: Decisions aren't made quickly. So, what are your customers telling you in terms of the tender pipeline and the opportunities there—appetite-wise? Have you seen a shift in delays or any slowdown because it's hard to make decisions in this environment?

Speaker #4: Or are you seeing a continued acceleration, as I guess the slides would suggest, with the tender pipeline you present? Thanks very much.

Speaker #5: Yeah. Good morning, Victoria. Thank you for your question. So, in terms of tendering, before a prospect comes to tendering, there's already been a lot of work and exploration and development to get enough definition before it reaches our pipeline.

Øivind Tangen: Yeah. Good morning, Victoria. Thank you for your question. In terms of tendering, before a prospect comes to tendering, there's been already a lot of work and exploration and for development to get enough definition before it reaches our pipeline. That wouldn't really be influenced by the more recent, let's call it oil price hikes. It's more about, for us, remaining on our model of early engagement with our clients and helping clients as when they invite us in with their development plans to gain pace and use the SBM value proposition. That dynamic hasn't really changed materially. We see the continued pipeline in Guyana. We see other countries in West Africa, as we've spoken about before as well, emerging with opportunities. We see Brazil still with a strong prospect pipeline in the years ahead.

Speaker #5: So that wouldn't really be influenced by the more recent, let's call it, oil price hikes. So it’s more about, for us, remaining on our model of early engagement with our clients, and helping clients, when they invite us in with their development plans, to gain pace.

Speaker #5: And use the SBM value proposition. That dynamic hasn't really changed materially. We see the continued pipeline in Guyana, and we see other countries in West Africa as we've spoken about before as well.

Speaker #5: Emerging, with opportunities. And we see Brazil still with a strong prospect pipeline in the years ahead. So for us, really, the dynamic hasn't changed that much.

Øivind Tangen: For us, really the dynamic hasn't changed that much. What you see over the last couple of years is this change from lease and operate to more sail and operate, and that has doing something with the competitive landscape. It may bring in other types of contractors, which is where we refer back to our competitive positioning and the life cycle proposition of SBM. It is competitive, it will remain competitive with the tender pipeline, and we like to think that the deep water in the Atlantic Basin, as we said, in the years ahead of us, remains very strong.

Speaker #5: What you see over the last couple of years is this change from lease and operate to more sale and operate. And that is doing something to the competitive landscape.

Speaker #5: It may bring in other types of contractors, which is where we refer back to our competitive positioning and the lifecycle proposition of SBM.

Speaker #5: So it is competitive. It will remain competitive, but the tender pipeline—and we like to think that the deepwater and the Atlantic basin, as we said, in the years ahead of us remains very strong.

Speaker #4: Thanks very much. Just as a follow-up to that, we've also seen a shift in the public commentary around decarbonization, certainly from the majors. And throughout the value chain, how much has that impacted, I guess, the work you do that we don't see around decarbonize options and that tender opportunity and that I appreciate it's much longer timeline to that and it's much earlier stage.

Victoria McCulloch: Thanks very much. Just as a follow-up to that, we've also seen a shift in the public commentary around decarbonization, certainly from the majors. Throughout the value chain, how much has that impacted, I guess, the work you do that we don't see around decarbonization options and that tender opportunity? I appreciate it's much longer timeline to that and it's much earlier stage, but have you seen a change as the outside environment have seen a change in tone?

Speaker #4: But have you seen a change, as the outside environment has seen a change in tone?

Øivind Tangen: No. I think from our own perspective, we've been working for many years on lowering the emission intensity of our FPSOs. That's been an ongoing journey, and we bring that into our offering of reducing the environmental footprint of the FPSOs. We're also conducting studies right now on modularized carbon capture systems that we are ready to integrate into our future FPSOs as and when they become as part of the specification in the actual prospects. Today, from a prospect in the market and the way the current market is, all the efficiency gains that we've developed and sort of already deployed on our FPSO, that remains, of course, a part of the

Speaker #1: No. I think from our own perspective, right? So we've been working for many years on lowering the emission intensity of our FPSO. So that's been an ongoing journey.

Speaker #1: And we bring that into our offering of reducing the environmental footprint of the FPSOs. And we are also conducting studies right now on modularized carbon capture systems that we are ready to integrate into our future FPSOs.

Speaker #1: As and when they become part of the specification in the actual prospects. Today, from the prospects in the market and the way the current market is, all the efficiency gains that we've developed and already deployed on FPSOs—that remains, of course, a part of the FPSOs of tomorrow.

Øivind Tangen: The F is also tomorrow, the next step to carbon capture, we don't see it materializing yet, or it may start to materialize, nothing has really changed dramatically for us. We always want to be environmentally efficient and also deliver on reliable energy solutions for the future. Let's see how policies evolve in the years ahead.

Speaker #1: But the next step to carbon capture, we don't see it materializing yet. Or it may start to materialize, but nothing has really changed dramatically for us.

Speaker #1: We always want to be environmentally efficient and also deliver on reliable energy solutions for the future. So let's see how policies evolve in the years ahead.

Speaker #4: Thanks very much.

Victoria McCulloch: Thanks very much.

Speaker #1: Thank you.

Øivind Tangen: Thank you.

Speaker #3: Thank you. We are now going to take our next question. And this one comes from Mick Pickup from Barclays. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Michael Pickup from Barclays. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Mick Pickup from Barclays. Please go ahead.

Speaker #6: Good morning, team. A couple of questions, if I may. They're both back-of-the-envelope type questions, so I'm just thinking medium term here.

Michael Pickup: Good morning, team. A couple of questions if I may. They're both back-of-the-envelope type questions. I'm just thinking medium term here. If I look at your turnkey order book by year of execution, you've roughly got $3 billion into next year and $3 billion for 2028. If I'm looking on that longer out view, $3 billion already, Longtail adds a chunk as well. You expect to win a couple more units before then. Why would I be wrong in thinking that turnkey doesn't go towards $5 billion of turnover medium term?

Mick Pickup: Good morning, team. A couple of questions if I may. They're both back-of-the-envelope type questions. I'm just thinking medium term here. If I look at your turnkey order book by year of execution, you've roughly got $3 billion into next year and $3 billion for 2028. If I'm looking on that longer out view, $3 billion already, Longtail adds a chunk as well. You expect to win a couple more units before then. Why would I be wrong in thinking that turnkey doesn't go towards $5 billion of turnover medium term?

Speaker #6: So if I look at your turnkey order book by year of execution, you've roughly got 3 billion in for next year. And 3 billion for 28.

Speaker #6: So, if I'm looking at that longer-term view, $3 billion already. Long tail adds a chunk as well. You expect to win a couple more units before then.

Speaker #6: Why would I be wrong in thinking that turnkey doesn't go towards $5 billion of turnover medium term?

Speaker #5: Is that.

Douglas Wood: Is that your question? Your only question, Mick? Good morning. Morning.

Speaker #1: Is that your question? Good morning.

Douglas Wood: Is that your question? Your only question, Mick? Good morning. Morning.

Speaker #6: That's the starting one.

Michael Pickup: That's a starting one.

Mick Pickup: That's a starting one.

Speaker #5: Okay. All right. Shall I answer?

Douglas Wood: Okay. All right. Shall I answer? Yeah. Douglas, why don't do the numbers in there, I stay away from it.

Douglas Wood: Okay. All right. Shall I answer?

Speaker #1: Yeah, yeah. Douglas, why don't you do the numbers in there as I stay away from it?

Øivind Tangen: Yeah. Douglas, why don't do the numbers in there, I stay away from it.

Speaker #5: Yeah. So just kind of a generally and I mean, you can see it from our backlog chart. So the what we have in hand is what we have in hand.

Douglas Wood: Yeah.

Douglas Wood: Yeah. Just generally, you can see it from our backlog chart. What we have in hand is what we have in hand, that's obviously in the backlog. What we're saying is there is a lot of potential from the strong market that we see, that's why we included that model scenario you can look at now. I think we've been very clear. That's not a forecast. It's not a target, but I think it gives a level of opportunity that we see. Yeah, if we're successful in capturing a portion of that, you can expect the turnkey to grow.

Douglas Wood: Just generally, you can see it from our backlog chart. What we have in hand is what we have in hand, that's obviously in the backlog. What we're saying is there is a lot of potential from the strong market that we see, that's why we included that model scenario you can look at now. I think we've been very clear. That's not a forecast. It's not a target, but I think it gives a level of opportunity that we see. Yeah, if we're successful in capturing a portion of that, you can expect the turnkey to grow.

Speaker #5: So that’s obviously in the backlog. But what we’re saying is there is a lot of potential from the strong market that we see, and that’s why we included that model scenario.

Speaker #5: You can look at now. I think we've been very clear that's not a forecast. It's not a target. But I think it gives a level of opportunity that we see.

Speaker #5: So yeah, I mean, if we're successful in capturing a portion of that, yeah, you can expect turnkey to grow.

Speaker #6: Right. And then, as a follow-up, just looking at your chart at the back on your net cash backlog, you're saying there's $1 billion of net cash coming from turnkey.

Michael Pickup: Right. Follow-up is just looking at your chart at the back on your net cash backlog. You are saying there is $1 billion of net cash coming from turnkey. You have $10 billion of backlog, teens margin. Just talk through the gap to that $1 billion of value, and obviously, tax is a big chunk, but is there anything else I should be thinking of?

Mick Pickup: Right. Follow-up is just looking at your chart at the back on your net cash backlog. You are saying there is $1 billion of net cash coming from turnkey. You have $10 billion of backlog, teens margin. Just talk through the gap to that $1 billion of value, and obviously, tax is a big chunk, but is there anything else I should be thinking of?

Speaker #6: So you've got $10 billion of backlog, teens margin—just talk through the gap to that $1 billion of value. And obviously tax is a big chunk, but is there anything else I should be thinking of?

Speaker #5: Yeah. So, in terms of the net cash, we've got some long-tail initial items, some of the stuff associated with the feed in there.

Douglas Wood: Yeah. In terms of the net cash, we have Longtail, the initial sum of the stuff associated with the FEED in there, so that is a bit dilutive. You have the $1 billion net cash, but it is net of overheads, which we have actually extended a bit because we added the stay-up award, so they ate longer. Obviously, we will be aiming to add more awards in the coming period, which will then consume or offset, if you like, a portion of those overheads.

Speaker #5: So that's like a bit diluted. And then you have the billion net cash, but it's net of overheads. So which we've actually extended a bit because we added the SAP award.

Speaker #5: So they, longer term, obviously will be aiming to add more awards in the coming period, which will then consume or offset, if you like, a portion of those overheads.

Speaker #6: So that's the core.

Michael Pickup: That is the core.

Mick Pickup: That is the core.

Douglas Wood: That is in the mix. If you are looking at doing a gross margin type of calculation, you have to add back the roughly $100 million overheads a year.

Speaker #5: So that's kind of in the mix. If you're looking at doing a gross margin type of calculation, you have to add back the roughly $100 million of overheads a year.

Speaker #6: Okay. Yeah, because obviously, you've got €10 billion of backlog, and you used to say €1 billion of capital value was just under €1 a share.

Michael Pickup: Okay. Yeah, because obviously, clearly, you got $10 billion of backlog. You used to say $1 billion of capital value was just under EUR 1 a share, that $10 billion is coming to EUR 5 now. Not 10.

Mick Pickup: Okay. Yeah, because obviously, clearly, you got $10 billion of backlog. You used to say $1 billion of capital value was just under EUR 1 a share, that $10 billion is coming to EUR 5 now. Not 10.

Speaker #6: And that €10 billion is coming to €5 there, not €10.

Speaker #5: Yeah.

Douglas Wood: Yeah.

Speaker #6: And so the difference is that it includes the corporate cost now?

Michael Pickup: The difference is that includes the corporate cost now?

Mick Pickup: The difference is that includes the corporate cost now?

Speaker #5: No, it's not the corporate cost. It's the turnkey overhead. So it's $100 million a year, so you've got like six years' worth of overheads there.

Douglas Wood: No, it's not the corporate cost, it's the turnkey overhead. It's $100 million a year. You've got 6 years worth of overheads there. That's $600 million. You're looking at $1.6 billion versus $10 billion, including Longtail, for which there isn't any net cash in the backlog yet. Of course, we are always clear to mention we take a relatively conservative approach when we project forward the backlog and include a bit of contingency.

Douglas Wood: No, it's not the corporate cost, it's the turnkey overhead. It's $100 million a year. You've got six years worth of overheads there. That's $600 million. You're looking at $1.6 billion versus $10 billion, including Longtail, for which there isn't any net cash in the backlog yet. Of course, we are always clear to mention we take a relatively conservative approach when we project forward the backlog and include a bit of contingency.

Speaker #5: So that's $600 million. So you're looking at $1.6 billion versus $10 billion including long tail, for which there isn't any net cash in the backlog yet.

Speaker #5: And of course, we are always clear to mention we take a relatively conservative approach when we project forward the backlog and include a bit of contingency.

Speaker #6: Thank you.

Michael Pickup: Thank you.

Mick Pickup: Thank you.

Speaker #1: Thank you, Mick.

Douglas Wood: Thank you, Mick.

Speaker #3: Thank you. We are now going to take our next question, and this one comes from Jeremy Kincaid from FNLA Shot Campen. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Jeremy Kincaid from Panmure Gordon. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Jeremy Kincaid from Van Lanschot Kempen. Please go ahead.

Speaker #7: Good morning, gentlemen. Congrats on the result. I'll start with two questions. First, I saw in the release that there was, unfortunately, a fatality at one of your subcontractors in one of the Chinese yards.

Jeremy Kincaid: Good morning, gentlemen. Congrats on the results. I'll start with two questions first. I saw in the release that there was unfortunately a fatality at one of your subcontractors in one of the Chinese yards. I assume that's one of the yards producing the Fast4Ward hulls. I was just wondering what the impact might be for you. Could there be delays? Might you have to do an audit of that yard? Does that limit your ability to construct future Fast4Ward hulls there going forward? My second question is on the upgrade to your EBITDA guidance. I was just curious about the nature of some of these strong operational performance factors which drove the upgrade. How sustainable are they? Should that mean I upgrade my EBITDA forecasts by $100 million out in FY 2027 and beyond?

Speaker #7: I assume that's one of the yards producing the Fast4Ward hulls. So I was just wondering what the impact might be for you. Could there be delays?

Speaker #7: Might you have to do an audit of that yard? And does that limit your ability to construct future Fast4Ward hulls there going forward?

Speaker #7: And then my second question is on the upgrade to your EBITDA guidance. I was just curious about the nature of some of these strong operational performance factors which drove the upgrade.

Speaker #7: How sustainable are they? Should that mean I upgrade my EBITDA forecasts by $100 million out in FY27 and beyond? And I've got two follow-up accounting questions after that, please.

Jeremy Kincaid: I've got two follow-up accounting questions after that, please.

Speaker #1: All right. Thank you, Jeremy. So, let's talk about the fatality. In the hierarchy of how we contract, a subcontractor of a subcontractor, very unfortunately, suffered a fatality after an incident in one of our yards in China.

Øivind Tangen: All right. Thank you, Jeremy. In the

Øivind Tangen: All right. Thank you, Jeremy. In the layers of how we contract to a subcontractor of a subcontractor, very unfortunately, we suffered a fatality after an incident in one of our yards in China. The way this is dealt with as any, what we categorize as a tier 1 event, is a very thorough investigation. Obviously, when there's loss of life, this also involves the authorities of the country in question, and we draw all the learnings from that, and we look after all the immediately impacted people, both in the external part of that equation and our own people that have been there and involved in those activities. That's our first priority. Of course, there is a lot of lessons we can learn from any such event, and that takes time. That we are in that phase now.

Øivind Tangen: In the layers of how we contract to a subcontractor of a subcontractor, very unfortunately, we suffered a fatality after an incident in one of our yards in China. The way this is dealt with as any, what we categorize as a tier 1 event, is a very thorough investigation. Obviously, when there's loss of life, this also involves the authorities of the country in question, and we draw all the learnings from that, and we look after all the immediately impacted people, both in the external part of that equation and our own people that have been there and involved in those activities. That's our first priority. Of course, there is a lot of lessons we can learn from any such event, and that takes time. That we are in that phase now.

Speaker #1: The way this is dealt with, as any what we categorize as a Tier One event, is a very thorough investigation. Obviously, when there's loss of life, this is also involved.

Speaker #1: The authorities—the country in question. And we draw all the learnings from that, and we look after all the immediately impacted people, both in the external part of that equation and our own people that have been there and involved in those activities.

Speaker #1: So that's our first priority. And then, of course, there are a lot of lessons we can learn from any such event. And that takes time.

Speaker #1: So that we are in that phase now. We're working on the thorough investigation to see also in mind that we keeping in mind that we expect to have growth in our operational activities in China going forward.

Øivind Tangen: We're working on the thorough investigation to see, keeping in mind that we expect to have growth in our operational activities in China going forward. We want to make sure we walk into that growth with the full set of learnings from this event. That is the main focus. From an operational perspective, there is no impact as such on yard selections or capacity or schedules on any work out of this incident as a direct impact. This is extremely unfortunate event, and our duty is to deal with that in the way the best practices are established for. To the second part of your question, no, there is no impact other than that. Douglas?

Speaker #1: We want to make sure we walk into that growth with the full set of learnings from this event. So, that is the main focus.

Speaker #1: From an operational perspective, there is no impact as such on yard selections, capacity, or schedules on any work out of this incident as a direct impact.

Speaker #1: This is an extremely unfortunate event. And our duty is to deal with that in the way the best practice is established. So but yeah, so to the second part of your question, no, there is no impact other than that.

Speaker #1: Douglas?

Douglas Wood: Yep. Hi, Jeremy. Just backing up a bit on EBITDA, we've been very consistent with our guidance. When we set the guidance from the beginning of the year, there were a number of risks and opportunities that we could potentially foresee. We tried to take a balanced view. I think it's fair to say, so far this year, we have been successful in capturing a number of opportunities, and there, I would say the fleet has performed pretty well. Some of our contracts, there are bonuses for uptime and various other performance things. We've been very successful during the H1 in capturing those. On, if you like, the risk side, a percentage point in percentage of completion on a project, particularly at the scale of the projects that we're now building, can have quite a material impact.

Speaker #5: Yep. Hi, Jeremy. So just backing up a bit on EBITDA, we've been very consistent with our guidance. When we set the guidance from the beginning of the year, there were a number of risks and opportunities that we could potentially foresee.

Speaker #5: So we would like to take a balanced view. I think it's fair to say so far this year we have been successful in capturing a number of opportunities and there, I would say the fleet has performed pretty well.

Speaker #5: And in some of our contracts, there are bonuses for uptime and various other performance metrics. So, we've been very successful during the first half in capturing those.

Speaker #5: Then on, if you like, the risk side, a percentage point in percentage of completion on a project, particularly at the scale of the projects that we're now building, can have quite a material impact. But what we've seen is the projects so far this year have gone very well.

Douglas Wood: What we've seen is the projects so far this year have gone very well. That's basically what makes the difference. Now for the accounting.

Speaker #5: So that's basically what makes the difference. And now, for the accounting.

Speaker #7: Yeah, just picking up on the working capital question. The drag has been quite severe over the last 12 months. It was, I think, $500 million in the second half last year.

Jeremy Kincaid: Yeah, just picking up on the working capital question. The drag has been quite severe over the last 12 months. It was, I think, $500 million in the H2 last year, and then another $450 million this year. You obviously talked to timing on the S&O contracts, and you've had some hulls which have been constructed. I suppose my question would be, should we expect a similar level of working capital drag over the next six to 12 months as you are building more hulls and you do have more S&O contracts coming into the mix?

Speaker #7: And then another $450 million this year. You obviously talked to timing on the S&O contracts, and you've had some hulls which have been constructed. So, yeah, I suppose my question would be: should we expect a similar level of working capital drag over the next 6 to 12 months as you are building more hulls and you do have more S&O contracts coming into the mix?

Speaker #5: Yeah, so we're very focused on managing working capital and associated liquidity. I guess one component to start with is, yeah, as we add more FPSOs, then we're going to add, on the operate side if you like, more working capital.

Douglas Wood: Yeah. We're very focused on managing working capital and associated liquidity. I guess one component to start with is, as we add more FPSOs, then we're going to add on the operate side, if you like, more working capital. Obviously, when we're doing our tendering, we're kind of pricing in the cost of that. Structurally, you have more FPSOs, you're going to have more in the operate phase working capital. Then, on the turnkey side, sail and operate. Over the lifetime of the construction process, we're aiming to run on average cash neutral. That's how we try to build things. But yeah, of course, from time to time, you get these big timing differences.

Speaker #5: Obviously, when we're doing our tendering, we're kind of pricing in the cost of that. But structurally, if you have more FPSOs, you're going to have more working capital in the operate phase.

Speaker #5: Then, on the Turnkey side, sale and operate. So, over the lifetime of the construction process, we're aiming to run, on average, cash neutral. That's how we try to build things.

Speaker #5: But yeah, of course, from time to time you get these big timing differences. And then, of course, again, it depends on new projects versus the rundown of old projects, because at some point, even if you've got a working capital help, at the end of the day after the project finishes, you need to pay the bills.

Douglas Wood: Of course, again, it depends on new projects versus the rundown of old projects, because at some point, even if you've got a working capital help, at the end of the day, after the project finishes, you need to pay the bills. It's this phasing, you will see. As you mentioned, yes, it's a strong market outlook. As such, we're very comfortable in the hull investments that we're making. With growth will increase working capital on an absolute basis and also because of sail and operate, the volatility.

Speaker #5: So it's this phasing you will see. And then, as you mentioned, yes, it's a strong market outlook. So, as such, we're very comfortable in the hull investments that we're making.

Speaker #5: So, with growth, its growth will increase working capital on an absolute basis, and also, because of sale and operate, the volatility.

Speaker #7: Helpful. Thank you.

Jeremy Kincaid: Helpful. Thank you.

Speaker #2: Thank you. We are now going to take our next question. This one comes from Ty Sparkelder from ABN AMRO Auto BHF. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Thijs Berkelder from ABN AMRO Oddo BHF. Please go ahead.

Speaker #5: Yeah. Thank you. Congrats on a strong performance. First question is on your slide 9, on your projects in execution. Where Jaguar, Gran Mouro, and Chelseaa, all according to the picture, are more or less one and a half years before delivery.

Thijs Berkelder: Thank you. Congrats with the strong performance. First question is on your slide nine, on your projects in execution, where FPSO Jaguar, GranMorgu, and Chalchi all according to the picture are more or less one and a half year before delivery. Could it be that also GranMorgu and Chalchi more or less get finalized before end of 2027? The next question is on Namibia. I wish TotalEnergies good luck as they would make the choice for Hanwha because then delivery dates probably will be 2 years or more later. In case the project is not won, would you need to then move people again away from Namibia to other locations in the world? The third question is on slide 17, on the cash returns.

Thijs Berkelder: Thank you. Congrats with the strong performance. First question is on your slide nine, on your projects in execution, where FPSO Jaguar, GranMorgu, and Chalchi all according to the picture are more or less one and a half year before delivery. Could it be that also GranMorgu and Chalchi more or less get finalized before end of 2027? The next question is on Namibia. I wish TotalEnergies good luck as they would make the choice for Hanwha because then delivery dates probably will be two years or more later. In case the project is not won, would you need to then move people again away from Namibia to other locations in the world? The third question is on slide 17, on the cash returns.

Speaker #5: So could it be that also Gran Mordo and Chelsea more or less get finalized before the end of ’27? Then the next question is, yeah, a question or comment on Namibia.

Speaker #5: I wish Total good luck if they were to make the choice for Hanwha, because then delivery dates would probably be two years or more later.

Speaker #5: But in case the project is not one where you then need to move people again away from Namibia to other locations in the world, then the third question is on slide 17 on the catch returns, which are more or less set.

Thijs Berkelder: Douglas, you more or less said, well, at this moment we are not yet updating our cash return picture although you have one, SARE one and two, and are probably close to the award of Longtail. What is reasonable to assume once, let's say, Longtail lands? Related to that, is it correct that in the backlog 2027 there's nearly nothing for Longtail at this moment?

Speaker #5: Well, at this moment, we're not yet updating our cash return picture. Although you have ONE Guyana and TWO Guyana, and are probably close to the award of Longtail, what is sort of reasonable to assume once, let's say, Longtail lands? And related to that, is it correct that in the backlog for '27, there's nearly nothing for Longtail at this moment?

Speaker #3: Was that Ty?

Øivind Tangen: That it, Geir?

Øivind Tangen: That it, Thijs?

Speaker #5: Thanks.

Douglas Wood: I think so.

Øivind Tangen: Okay. Sorry. Let's see, projects in progress. I think our release has pretty clear dates. The most advanced project is Jaguar, right? With pretty much all our top side modules on board and we are in the early commissioning phase for a start-up next year, and the other two are going to start up in the subsequent year, as per plan. We are very happy with the progress across the portfolio. On Namibia, can you just get me back to the question whether or not, I didn't catch all of it. If you could just repeat.

Speaker #3: Did we lose—yeah. Okay, sorry. So let's see, projects in progress. I think a release has pretty clear dates. I mean, the most advanced project is Jaguar, right, with pretty much all the upside modules on board, and we are in the early commissioning phase for a startup next year.

Speaker #3: And the other two are going to start up in the subsequent year. As per plan, we were happy with the progress across the portfolio.

Speaker #3: On Namibia, could you just get me back to the question? I didn't catch all of it. If you could just repeat it?

Speaker #7: Yeah. First, coming back on Jaguar and Gran Mouro at the contract,

Thijs Berkelder: First coming back on Jaguar and GranMorgu. Are the contracts indicating that the transfer of the vessel is already taking place in Singapore or not, or only after first oil? Because you have a first oil date there. Isn't the contract saying that, let's say you already delivered to the client when leaving the port in Singapore? On Namibia, what is the SBM Offshore scenario on your people and preparations in Namibia should you not get the award from Total?

Speaker #5: Are you indicating that the transfer of the vessel is already taking place in Singapore, or not? Or is it only after first oil, because you have a first oil date there?

Speaker #5: It isn't a contract saying that, let's say, you already delivered to the client when leaving the port in Singapore. On Namibia, yeah, what is, let's say, the SBM Offshore scenario on your people and preparations in Namibia should you not get the award from Total?

Speaker #3: Yeah. Okay, thank you. So, the sale and operate contracts—they transfer ownership at the same way from the yard, and then there is a warranty period thereafter.

Øivind Tangen: Yeah. Okay. Thank you. They sail and operate contracts, they transfer ownership at the sail away from the yard. There is a warranty period thereafter. That's standard. There's an O&M contract that comes into effect as we move into the operational phase following the offshore commissioning. On Namibia, we have a very small structure in Namibia. We believe in the Namibian outlook, that is not just linked to Venus, but in general terms, we are hoping it will be a prolific market. It's a team that works on mapping out the opportunities in Namibia and position us there for future growth there. We are not linking directly our plan there with just the outcome of the Venus. It's more a strategic direction for the company as such. It's a very minimal cost with a potential high upside to us.

Speaker #3: So that's standard. And then there's an O&M contract that comes into effect as we move into the operational phase, following the offshore commissioning in Namibia.

Speaker #3: We have a very small structure in Namibia. We believe in the Namibian outlook, and that is not just linked to Venus but in general terms.

Speaker #3: We're hoping it will be a prolific market. So, it's a team that works on mapping out the opportunities in Namibia and positioning out there for future growth.

Speaker #3: So we're not linking directly our plan there. We are just looking at the outcome of the Venus; this is a more strategic direction for the company as such.

Speaker #3: It's a very minimal cost with high potential, high upside to us. So, that is that. And then, cash returns service.

Øivind Tangen: That is that, the cash returns, Douglas?

Douglas Wood: Yes. As I mentioned, we'll do an update. We are going to do it on an annual basis because we don't want to do kind of six H1 to H1, 2032 type of thing. To keep it simple, we do it once a year. Already in our net cash backlog, we have SARE one and two, and subject to Longtail going ahead, we would hope to add that. As I mentioned, relative to H1, we're optimistic that the net cash backlog could be higher at the end of the year, which would then obviously convert into more available cash relative to the EUR 2.1 billion minimum that we have so far.

Speaker #5: Yes, so yeah, like I mentioned, we'll do an update. We're going to do it on an annual basis because we don't want to do kind of six H1-to-H1 2032 type of things.

Speaker #5: So, to keep it simple, we do it once a year. But yeah, of course—and already in our net cash backlog, we have, say, at one and two, and subject to long tail going ahead, we would hope to add that.

Speaker #5: So, as I mentioned, relative to H1, we're optimistic that the net cash backlog could be higher at the end of the year, which would then obviously convert into more available cash relative to the $2.1 billion minimum that we have so far.

Speaker #5: So yeah, just to be clear, we're pointing to the fact, in the way that we say 'minimum' on the one hand, and then with these new awards, there will be upside in terms of returns.

Douglas Wood: Just to be clear, we are pointing to the fact in the way that we say minimum, on the one hand, these new awards, there will be upside in terms of returns. Our policy is to link our shareholder returns to the backlog. As that grows, we should be able to increase returns. Specifically you asked about Longtail. In the revenue backlog, we got Longtail, but we don't have it in the net cash backlog at the moment. Longtail would increase the net cash backlog.

Speaker #5: And our policy is to link our shareholder returns to the backlog, so as that grows, we should be able to increase returns. Then, specifically, you asked about long tail.

Speaker #5: In the revenue backlog, we have the long tail, but we don't have it in the net cash backlog at the moment. So, the long tail would increase the net cash backlog.

Speaker #5: Okay, thanks for that. And maybe a final one for the record. Can you indicate whether you have had any real impact from the conflict in the Middle East on your operations or your asset construction?

Thijs Berkelder: Thanks for that. Maybe a final one for the record, whether you can indicate whether you have any real impact from the conflict in the Middle East on your operations or your FPSO under construction, can you maybe repeat what your, let's say, maybe most crucial supplies are, like turbines or so? That's also for the record.

Speaker #5: And/or, can you maybe repeat what your, let's say, maybe most crucial supplies are? Like turbines or so, that also for the record?

Speaker #3: Okay. Thank you, Thy. So Middle East, so we've assessed that in great detail since the start of this situation. We have no material impact of any sort on operational activities nor on, let's call it, recent awards that may where we can still going to go out and be very active in the supply chain.

Øivind Tangen: Thank you, Thijs. Middle East, we've assessed that in great detail since the start of this situation. We have no material impact of any sort on operational activities nor on, let's call it recent awards where we are still going to go out and be very active in the supply chain. For the record, we do not have.

Speaker #3: So, for the record, we do not have.

Thijs Berkelder: The most crucial supplies?

Speaker #5: And the most crucial supplies?

Thijs Berkelder: The most crucial supplies?

Speaker #3: Yeah, so the most crucial supplies in our general supply chain are typically rotating machinery, where we always work on anticipation. And it's not impacted by the Middle East.

Øivind Tangen: Yeah. The most crucial supplies in our general supply chain is typically rotating machinery, where we always work in anticipation, and it's not impacted by Middle East conflict.

Speaker #5: Okay. Thanks.

Thijs Berkelder: Okay, thanks.

Speaker #3: Thank you.

Øivind Tangen: Thank you.

Speaker #2: Thank you. We are now going to take our next question, and this one comes from Kirin Mulder from ING. Please go ahead.

Operator: Thank you. We are now going to take our next question. This one comes from Quirijn Mulder from ING. Please go ahead.

Speaker #5: Yeah. Good morning, everyone. Two small questions. One is: how large is the impact of Ngoma extensions, and what is the potential for later on—let me say after December 2028?

Quirijn Mulder: Yeah. Good morning, everyone. Two small questions. One is, how large is the impact of N'Goma extensions, what is the potential for later on, let me say after December 2028? My second question is about your remark about Veolia. How concrete are these plans for desalination plants with the French player? Where is the idea? What's the place to build that? Those were my questions.

Speaker #5: And my second question is about your remark about Veolia. How concrete are these plans for desalination plants with the French player? Can you give us some what's and where's around the idea?

Speaker #5: Where is the place to build that? Those were my questions.

Speaker #3: Okay. Let me say a bit on desalination, and I was talking about Ngoma. So, we work with Veolia on water treatment on many of our FPSOs.

Øivind Tangen: Okay. Let me do a bit on desalination, and Douglas will talk about N'Goma. We work with Veolia on water treatment on many of our FPSOs, so it is about repurposing already known technology with them. They are a leading water treatment company in the world. They have a big network of industrial relations in that space. We are very good on offshore infrastructure and modularized solutions. The combination of those two opens up potential commercial avenues into space where special industrial applications where freshwater is required. It could be mining or other types of markets. For now, this is, technology-wise, is a well-documented solution. From a commercial and market-wide, that is where we are looking now and studying the size of that potentially. Of course, it is about pace of execution using, leveraging the same partnerships for build and equipment that we have already existing in our supply chain.

Speaker #3: So it's about repurposing already known technology with them. They are a leading water treatment company in the world. They have a big network of industrial relations in that space.

Speaker #3: We are very good at ocean infrastructure and modularized solutions. The combination of those two opens up potential commercial avenues into spaces where special industrial applications require fresh water.

Speaker #3: It could be mining or other types of markets. So for now, technology-wise, it's a well-documented solution. From a commercial and market perspective, that is where we're looking now and studying the size of that potential.

Speaker #3: And, of course, it's about pace of execution, leveraging the same partnerships for build and equipment that we already have existing in our supply chain.

Speaker #3: So it's really in line with the strategic thinking that we've also communicated in the past, of really repurposing the existing solutions that are some of the building blocks of the FPSOs and leveraging the partnerships we have.

Øivind Tangen: It is really in line with the strategic thinking that we have also communicated through the past of really repurposing the existing solutions that are some of the building blocks of the FPSOs and leveraging the partnerships we have in the supply chain. Follow this one. It is exciting. Douglas?

Speaker #3: In the supply chain. So, follow this one—it's exciting.

Speaker #5: All right. Hi, Kirin. So, Ngoma, that's a two-year, rough extension to 2028. So it makes a small but meaningful, I would say, contribution to the net cash backlog.

Douglas Wood: All right. Hi, Quirijn. N'Goma, that is a two-year rough extension to 2028. It makes a small but meaningful, I would say, contribution to the net cash backlog. Let us say, if you are generous with the rounding, it impacts the net cash backlog number, if that gives you a sense.

Speaker #5: And let's say, if you're generous with the rounding, it impacts the net cash backlog number, if that gives you a sense.

Speaker #4: Okay. Thank you.

Quirijn Mulder: Okay. Thank you.

Øivind Tangen: Thank you, Quirijn. All right. Operator?

Speaker #3: Thank you, Kirin. All right, Operator.

Operator: Hello, this is the operator. We will now take our next question. Please stand by. Next question is on the line of Philip GATO from Kepler Cheuvreux. Please go ahead.

Operator: Hello, this is the operator. We will now take our next question. Please stand by. Next question is on the line of Philip Ngotho from Kepler Cheuvreux. Please go ahead.

Speaker #2: Hello, this is the operator. We will now take our next question. Please stand by. The next question is from Philip Nogota with Kepler Cheuvreux.

Speaker #2: Please go ahead.

Speaker #5: Yes, hi. Just one follow-up question, and it relates to the comment on the Turnkey segment—the $100 million overhead. Douglas, I was just wondering, how has that evolved over the years?

Philip Ngotho: Yes. Hi. Just one follow-up question, and it relates to the comment on the turnkey segment, the EUR 100 million overhead. Douglas, I was just wondering, how has that evolved over the years? How large has the turnkey segment then grown? Also just maybe interested in number of, if you look at FTE splits or what is there now in turnkey to get a sense of the size.

Speaker #5: So, how large has the Turnkey segment grown then? And also, I’m maybe interested in the number—if you look at the FTE splits, or what is there now in Turnkey?

Speaker #5: To get a sense of the size—yeah. Hello again, Philip. So, I would say it's been pretty—the overhead itself has been pretty stable, and we're very good at, as I said, managing the overall complement of people and minimizing under-recovery.

Douglas Wood: Yes. Hello again, Philip. I would say the overhead itself has been pretty stable, and we're very good at managing the overall complement of people and minimizing under recovery. Yes, it's pretty stable.

Speaker #5: So, yeah, it's pretty stable. Okay. Okay. Thank you.

Philip Ngotho: Okay. Thank you.

Speaker #2: Thank you. There are no further questions, Mr. Tangen.

Operator: Thank you. There are no further questions, Mr. Tangen.

Speaker #3: All right. Thank you so much. Thanks to all of you who have engaged in the call today. We look forward to sharing more information as the company progresses in the next quarter.

Øivind Tangen: All right. Thank you so much. Thanks to all of you that have engaged in the call today. We look forward to sharing more information as the company progresses in the next quarter. Have a nice day.

Speaker #3: Have a nice day.

Operator: Ladies and gentlemen, thank you for attending. This concludes the SBM Offshore event call. You may now disconnect your line. Have a nice day.

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