REGISTRATION DOCUMENT - Bourbon

MANAGEMENT REPORT3Results“Other” mainly includes items appertaining to the cement carrier,Endeavor, and externally chartered offshore vessels as well as itemsnot included in the two other activities. Use of chartered vesselsmakes it possible to meet customers’ needs and fulfi ll contractswhilst waiting for new vessels to be completed and added to the fl eetor by offering types of vessels not normally provided by BOURBONservices within the context of global competitive bidding processes.2.4 STRATEGIC PLAN2011 was the fi rst year of the “BOURBON 2015 Leadership Strategy”plan, the Group now focusing on offshore oil and gas marine services.Growth in revenues in 2011In 2011, revenues from Marine Services and Subsea Services grewby 19.2% at current exchange rate (21.3% at constant exchangerate). The “BOURBON 2015 Leadership Strategy” plan has anobjective of 17% offshore average annual revenue growth between2011-2015.Progress of the investment programIn line with the “Horizon 2012” investment plan, BOURBON had takendelivery of 243 vessels and ROVs by the end of 2011. BOURBONwas still awaiting 18 of the vessels included in this plan, includingthree Liberty vessels and nine IMR vessels. The bulk of these are dueto be delivered in 2012.In line with the “BOURBON 2015 Leadership Strategy” investmentplan, as of December 31, 2011, BOURBON had ordered 103 vesselsfor a total of €1 billion, 65% of the plan having been implemented.On that date, BOURBON had already taken delivery of 14 vessels.Financing of the investment programUnder the “BOURBON 2015 Leadership Strategy” plan, theassumption is that cash fl ow generated from operations will amountto €2,700 million between 2011 and 2015; this will enable net debtto be reduced by €360 million by the end of the plan.As of December 31, 2011, the amount of long-term loans availablefor drawdown amounted to €15 million. In addition, the $ 400 millionloan secured from China Exim-Bank in June 2010 will becomeavailable from 2012, as and when vessels fi nanced on that date aredelivered by the Chinese Sinopacifi c shipyard.The commercial value of unmortgaged vessels in operationamounted to €747 million.Over the 2012 -2015 period, additional fi nancing will be needed tomeet maturity repayments on existing loans and to complete theinvestment program.Should market conditions prevent operational cash fl ows from beinggenerated in line with these hypotheses, the debt reduction forecastfor the second half of the plan may be proportionately less, or indeedmay not occur until after 2015.Financial ratios in 2015The “BOURBON 2015 Leadership Strategy” plan aims to achieve aratio of “EBITDA to average capital employed excluding installmentsfor vessels under construction” of 20% for 2015 (assuming anexchange rate of EUR 1 to USD 1.30). For 2011, at the bottom ofthe cycle, this ratio was 11.5% (average exchange rate for 2011:EUR 1 = USD 1.35).The plan also targets a ratio of “EBITDA to revenues” for 2015 of45% for the offshore activity. This ratio came to 29.8% in 2011, indiffi cult market conditions.The fl eet’s availability rate (1) was 93% in 2011, with a target of 95%in 2015.The operating costs index (base 100 = 2010) reached 100.9 in 2011,the year in which operational excellence programs were deployed,with a target of 96 in 2015.The objectives summarized above are not data forecasts but simpleobjectives arising from the Group’s strategic guidelines and plans ofaction. They are based on data and hypotheses considered to bereasonable by BOURBON. These data and hypotheses are likely tochange or to be amended due to uncertainties relating, in particular,to investment opportunities and the economic, fi nancial, competitiveor even regulatory environment. Moreover, the occurrence of certainrisks described in paragraph 4 “Risk factors” of the managementreport, may have an impact on BOURBON’s activities and itscapacity to achieve such objectives. In addition, the achievement ofthese objectives assumes the strategy described in this documentto be successful.BOURBON cannot, therefore, make any commitments nor give anyguarantees as to the achievement of the objectives appearing inthis chapter and does not agree to publish or give notice of anycorrections or updates in this regard.2.5 BOURBON SA RESULTS (PARENT COMPANY)Since the Company failed to post any revenues in 2011, the operatingloss of €3.2 million was down slightly by 0.4 million on 2010.Financial income was positive at €96.6 million, down €60.9 millionon the previous year. This drop mainly related to the fact that 2010recorded major reversals of provisions for equity holdings followingthe sale of Sucrerie de Bourbon Tay Ninh. To a lesser extent, it wasalso the result of a fall in dividends cashed.Exceptional income was up €39.7 million on the previous year, beingimpacted by the income from the sale of Sucrerie de Bourbon TayNinh. In 2011, the effect of the liquidation of the subsidiary BourbonDuhaco was also recorded.As a result, the net income of €98.3 million posted for the year was€29.0 million down on 2010.No expense referred to in Articles 39.4 and 223 quater of the FrenchGeneral Tax Code was identifi ed.(1) Vessel’s availability rate: over a given period, number of days the vessel is not in complete technical stoppage (for example: periodic drydock, breakdownpreventing provision of service), divided by the number of calendar days.20BOURBON - 2011 Registration Document