4.1.4Financial Review IFRS
|
IFRS |
||
|---|---|---|
|
in US$ million |
FY 2018 |
FY 2017 |
|
Revenue |
2,240 |
1,861 |
|
Lease and Operate |
1,302 |
1,554 |
|
Turnkey |
938 |
307 |
|
EBITDA |
838 |
612 |
|
Lease and Operate |
761 |
919 |
|
Turnkey |
184 |
73 |
|
Other |
(107) |
(380) |
|
Underlying EBITDA |
844 |
823 |
|
Lease and Operate |
761 |
919 |
|
Turnkey |
147 |
(34) |
|
Other |
(64) |
(62) |
|
Profit/(loss) attributable to shareholders |
212 |
(155) |
|
Underlying profit attributable to shareholders |
247 |
151 |
Underlying Performance
The 2018 non-recurring items described in note 4.1.3 Financial Review Directional have the same impact under IFRS and Directional reporting, with the exception of i) the disposal of Turritella (FPSO) which was already fully recognized in 2017 under IFRS and ii) a different value for the reversal of impairment on a loan to one of the Angolan joint ventures (US$ 15 million under IFRS compared with US$ 21 million under Directional reporting). As a result, the total impact of non-recurring items for 2018 on IFRS profit attributable to shareholders is US$ (35) million.
For reference, total non-recurring items for 2017 underlying performance impacted the IFRS profit attributable to shareholders by US$ (306) million.
Profitability
Revenue
Total IFRS revenue increased by 20% to US$ 2,240 million compared with US$ 1,861 million in 2017. This increase was driven by the Turnkey segment with full-year construction activities related to FPSO Liza Destiny and the Johan Castberg Turret Mooring System EPC, both starting during the second half of 2017, as well as the general ramp-up of other Turnkey activities such as Offshore Terminals and Offshore Contracting. The positive contribution of the Turnkey segment was partly offset by a decrease in revenue of the Lease and Operate segment mainly due to Turritella (FPSO) leaving the fleet, planned maintenance, and declining profile of interest revenue from finance leases.
EBITDA
IFRS EBITDA amounted to US$ 838 million, representing a 37% increase, largely driven by non-recurring items, compared with US$ 612 million in 2017.
Adjusted for non-recurring items, 2018 underlying IFRS EBITDA was broadly stable at US$ 844 million compared with US$ 823 million in 2017. This resulted from a decrease of the Underlying EBITDA of the Lease and Operate segment, mainly due to Turritella (FPSO) leaving the fleet, planned maintenance and declining profile of interest revenue from finance leases, more than offset by an improvement in the Turnkey segment with the full year contribution of FPSO Liza Destiny, the general ramp-up of Turnkey activity, the implementation of IFRS 16 and realized savings on overhead costs.
Net income
Excluding non-recurring items, 2018 underlying consolidated IFRS net income attributable to shareholders stood at US$ 247 million, an increase of US$ 96 million from the previous year.
Statement of Financial Position
|
in millions of US$ |
2018 |
2017 |
2016 |
2015 |
2014 |
|---|---|---|---|---|---|
|
Total equity |
3,612 |
3,559 |
3,513 |
3,465 |
3,149 |
|
Net debt1 |
3,818 |
4,613 |
5,216 |
5,208 |
4,775 |
|
Net cash |
718 |
957 |
904 |
515 |
475 |
|
Total assets |
9,992 |
11,007 |
11,488 |
11,340 |
11,118 |
- 1 Net debt at December 31, 2018 is calculated as total borrowings (including lease liabilities) less cash and cash equivalents.
Total equity increased from US$ 3,559 million to US$ 3,612 million as a result of the profit over the financial year, partially offset by (i) dividends paid to shareholders and (ii) equity repayment and dividends paid to non-controlling interests.
IFRS net debt stood at US$ 3,818 million at year-end 2018 compared with US$ 4,613 million in 2017 despite (i) significant investments in FPSO Liza Destiny and two Fast4WardTM hulls over the period and (ii) recognition of lease liabilities due to IFRS 16 implementation. This has been possible as a result of the strong operating cash flow from the Lease and Operate segment, while the net proceeds from the Yme insurance claim and the Turritella (FPSO) disposal offset to a large extent the payment of the non-recurring penalties as a result of the Leniency Agreement.
Excluding the lease liabilities recognized following the early adoption of IFRS 16 (at a net book value of US$ 189 million at December 31, 2018), all of the Company’s debt consisted of non-recourse project financing in special purpose investees with no borrowing at corporate level as of December 31, 2018.
Total assets decreased to US$ 10.0 billion as of December 31, 2018 compared with US$ 11.0 billion at year-end 2017. This decrease is mainly attributable to finance lease redemptions, in particular the redemption of the Turritella (FPSO) finance lease receivable, and capex depreciation over the period, whereas the investments in FPSO Liza Destiny and inventory (two Fast4WardTM hulls), financed by the use of the cash available at Corporate level, were offset by a consequent decrease of the net cash position.