Press Release

Luxembourg, November 12, 2024

• Fleet fully contracted at competitive day rates
• Norbe VIII concluded SPS and is ready to start its new contract
• Backlog of $1.4 billion as of September 30, 2024
• Efficiency is a top priority, operational uptime reached 99% in 3Q24
• High level of profitability: $131 million of Adjusted EBITDA and 36% of margin in 9M24
• Cash flow from operations generated almost $100 million in 9M24
• Solid capital structure, liquidity of $142 million and leverage² of 1.0x at 3Q24
• Approval of $37 million as interim payment to shareholders, totaling $70 million in 2024

Foresea is pleased to release its 2024 third quarter results. The backlog at the end of September 2024 registered $1.4 billion, reflecting a fully contracted fleet. Norbe VIII concluded its SPS at the beginning of November and is ready to start its new 3-year contract. Following another set of strong operational and financial results, the Company declared an interim distribution of $37 million, expected to be paid on December 5^th, totaling approximately $70 million in payments to shareholders in 2024.

Mr. Rogerio Ibrahim, Foresea’s CEO stated “Our Company delivered another strong result in all aspects of the business, proving that the values ​​proposed by Foresea translate into operational excellence, solid capital structure and value creation for stakeholders.

The fully contracted fleet and short-term opportunities reinforce our Company’s position as a reference player in the O&G offshore drilling segment, particularly in Brazil, one of the most important regions for the industry.

Foresea is fully focused on guaranteeing organic opportunities with its fleet while delivering exceptional operational performance, integrated with its commitment to safety and capital discipline. Following the successful completion of an important SPS, we are dedicated to maintaining the integrity of our assets and investing in innovation, allowing us to execute highly complex jobs scopes with precision.

This effort to keep our fleet working, with renewed dayrates, gives us predictability regarding our cash flow generation for the next few years. Based on this scenario, the Board of Directors declared the second distribution to shareholders, $37 million expected to be paid in December, bringing total distributions in 2024 to $70 million. We reinforce our commitment to generate reliable returns for the shareholders.”

Financial Results

Third quarter (3Q24) net revenues totaled $120.9 million, a slight decrease of 5.2% compared to the $127.5 million registered in the previous quarter (2Q24). The performance is explained by the lower utilization rate, considering the 53 days of SPS in 3Q24 of Norbe VIII, partially offset by the higher operational uptime and fleet’s dayrate.

The average daily revenue reached $281.2 thousand per day in 3Q24, an increase of 3.7% on quarterly basis and +31.9% versus 3Q23. The indicator has steadily increased for the last year, reflecting the substitution of previous legacy contracts for the current healthy market day rates.

In the nine months of 2024 (9M24), net revenues rose 47.5%, compared to $249.7 million registered in the same period of 2023. This result is mainly explained by the fleet’s better dayrates and also by the higher utilization in 9M24 due to the ODN I SPS and off hired period in 9M23.

Operating costs in 3Q24 amounted to $68.7 million, 4.3% lower than the previous quarter. The daily operational cost of the owned fleet was approximately $145 thousand per day in the quarter, in comparison to approximately $155 thousand per day in 2Q24. The quarterly reduction in operating costs is mainly explained by the lower operating days of Norbe VIII, with a subsequent decrease in additional services requested by clients and repair & maintenance activities.

General and administrative expenses (G&A) decreased 3.6% on a quarterly basis. The 3Q24 performance is mainly explained by optimization of personnel expenses.

Adjusted EBITDA for the third quarter of 2024 reached $45.2 million, a 7.1% decrease versus 2Q24. The quarterly performance, as explained above, was driven by the Norbe VIII SPS, impacting the quarter’s revenues that was partially offset by higher operational performance and decrease in costs and expenses. Based on these effects, the Adjusted EBITDA margin reached 37.4% in 3Q24, a slight decrease of 0.7 p.p. compared to 38.1% accounted in the previous quarter.

In the first 9 months of the year, Adjusted EBITDA amounted to $131.3 million, twice that 9M23, and Adjusted EBITDA margin reached 35.6%, an increase of 9.4 p.p. year-over-year.

Cash Flow from Operations (CFFO) generated $48.0 million in the quarter and $98.9 million in 9M24. This performance highlights the translation of better portfolio dayrates, operational efficiency and strict cost control into cash generation.

Capex accelerated in the 3Q24 and consumed $22.1 million, an increase from the $13.1 million invested in the 2Q24, as Norbe VIII started its SPS in August 2024. Although Norbe VIII’s SPS finished at the beginning of November, some residual Capex will be recognized in the coming quarters.

Therefore, the Company registered another quarter of positive free cash flow generation, amounting to $25.9 million in 3Q24 and $52.6 million in 9M24.

Foresea ended the third quarter of 2024 with a $141.7 million cash position, just a slight decrease from $153.4 million at the closing of the previous quarter, most explained by the $33 million interim payment to shareholders in July.

Foresea’s only debt is the $300 million Secured Notes due 2030, issued in June 2023, and recorded on the company’s balance sheet as $276.9 million as of September 30, 2024, due to related transaction costs. Leverage ratio, Net Debt/ LTM Adjusted EBITDA, calculated based on the face value of the debt, reached only 1.0x at the closing of the quarter, well below the notes covenant of 3.5x.

As a post-event, Foresea approved an interim distribution to its shareholders of $36.9 million, representing a payment of $1.23/share. The record date of the distribution is November 20, 2024, and payment is expected to be made on December 5, 2024.

Operational Highlights

The Company successfully concluded the SPS in one of its ultra-deep water high-specification drillships, Norbe VIII. The maintenance included a dry-dock stoppage that required more than a year of planning. This period enabled upgrades in the Dynamic Positioning of the rig, the overhaul of thrusters and maintenance of the drilling package, drilling equipment control systems, subsea equipment, as well as cleaning, restoration and painting of the hull. More than 1,000 workers took part in this unprecedent maintenance in Brazil on a large vessel. The period was concluded without recordable incidents, reinforcing Foresea’s team commitment to the integrity of its assets and the safety of its operations.

Operational uptime reached 98.8% in the third quarter of 2024, an improvement from 97.9% in 2Q24 and 94.1% in 1Q24, reaffirming Foresea’s operational excellence, as seen in previous years.

Rig utilization in 3Q24 recorded 88.5%, as Norbe VIII underwent SPS for 53 days in the quarter, preparing for its new contract.

Finally, the Company does not expect any other SPS for 2024 and is currently evaluating the 2025 SPS Program. This evaluation aligns with short-term fleet opportunities and upholds the highest safety standards in the industry.

About Foresea

Foresea is a leading offshore drilling company, focused on offering intelligent drilling solutions, with expertise and excellence in chartering and operating rigs for ultra-deep waters. Foresea operates a high specification rig fleet of 4 UDW drillships, a semisubmersible and provides operation and management services to third parties’ fleet.

With experience, state-of-the-art technology and a commitment to safety and sustainability, Foresea is always innovating when chartering and operating platforms and ships. For further information, please visit: https://investors.foresea.com/ or e-mail investor.relations@foresea.com.

Forward-Looking Statements

This document contains forward-looking financial projections for Foresea Holding S.A. as of September 30, 2024. These statements could contain words such as terms “assumes”, “projects”, “forecasts”, “estimates”, “expects”, “anticipates”, “believes”, “plans”, “intends”, “may”, “might”, “will”, “would”, “can”, “could”, “should”, “possible”, “if,” or other similar expressions. Forward-looking statements are based on management’s current expectations and assumptions regarding future economic conditions, market trends, and the execution of our business strategy, including, but not limited to, any statement that may project, indicate or imply performance or achievements; future recovery in the offshore contract drilling industry; expectations regarding the Company’s plans, strategies and opportunities, expectations regarding the Company’s business or financial outlook, future borrowing capacity and liquidity, expected utilization, dayrates, revenues, operating expenses, rig commitments and availability, cash flows, tax rates and accounting treatment, contract status, terms and duration, contract backlog, capital expenditures, insurance, financing and funding. Please be aware that these forward-looking financial projections are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict, and factors beyond our control, which may cause actual results to differ materially from what is projected and should be considered as estimates only.

All subsequent written and oral forward-looking statements attributable to the Company or to people acting on its behalf are expressly qualified in their entirety by reference to these risks and uncertainties. The Company undertakes no obligation to update or revise these forward-looking financial projections, whether as a result of new information, future events, or otherwise.

Investors and stakeholders are advised to exercise caution and not to place undue reliance on these forward-looking statements. Actual results may vary, and the Company assumes no obligation to provide updates or revisions beyond what is legally required.