SOLID RESULTS AND A RECORD ORDER BACKLOG
Highlights
• Turnover US$ 2,957 million (US$ 3,060 million in 2008);
• Net profit of US$ 230 million (US$ 228 million in 2008);
• New orders totalled US$ 3,740 million (US$ 4,366 million in 2008);
• Record backlog US$ 10,032 million (2008: US$ 9,247 million);
• Net debt US$ 1,464 million (net gearing 81%);
• EPS of US$ 1.47 (US$ 1.54 in 2008), dividend of US$ 0.67 per share (US$ 0.93 in 2008).
Outlook 2010
• Turnover in the same range as 2009 – 80% secured from current backlog;
• EBIT margin from Turnkey Systems to increase;
• Lease and Operate EBIT contribution below 2009.

Key figures
US$ million 2009 2008 Change
Turnover 2,957 3,060 (3.4%)
EBITDA 613.3 530.1 15.7%
EBIT 293.4 275.1 6.7%
Net profit 230.0 227.9 0.9%
EBIT margin 9.9% 9.0% 10.0%
Investment in fixed assets 656.0 1,000 (34.4%)

Tony Mace, CEO of SBM Offshore: “We are pleased to announce solid financial results for 2009 with a profit slightly ahead of the previous year. Execution performance on the major ongoing projects has in general improved resulting in increased profit margins. The Company’s fleet of leased vessels has again performed very well generating substantial bonus revenues. We were successful in obtaining some major new orders in the second half of the year and have increased the order backlog to a new record level. The share offering in
November has strengthened our balance sheet to fund the Company’s ongoing plans for further development of our lease business”.

1. Financial Review
In accordance with IFRS 8 accounting rules for segmental reporting, the Company now provides separate disclosure of its Turnkey Services activities, which were previously combined with the Turnkey Systems activities. Specific allocation of Selling and Marketing, and General and Administrative expenses are now made to the reporting segments, and the 2008 comparative figures have been restated accordingly.

. Turnover decreased by 3.4% to US$ 2,957 million, in comparison with US$ 3,060 million in 2008, mainly as a result of lower Turnkey Systems revenues. . Turnkey Systems contributed 65%, Turnkey Services 8% and Lease and Operate 27%. In 2008 the corresponding split was 65%, 9%, 26%.
. EBITDA amounted to US$ 613.3 million, an increase of 16% compared to US$ 530.1 million in 2008.
. Operating profit (EBIT) increased by 6.7% to US$ 293.4 million compared with US$ 275.1 million in 2008.
. The EBIT margin increased to 9.9% compared to 9.0% in 2008.

Before allocation of “Other” income and expenses, segmental EBIT margins are as follows:
In the Turnkey Systems segment the good results generated from the more recent projects become more predominant, and despite some further schedule and cost increases on the drilling rigs series and on a heavy lift crane project, the EBIT margin increased to 5.0% (2008: 0%).
In the Turnkey Services activities excellent operating performance was offset by full impairment (US$ 7.6 million) of the Pyrodriver installation tool, development of which has been discontinued. The EBIT margin increased slightly to 20.3% (2008: 19.9%).
Although turnover in the Lease and Operate activities was stable, EBIT was negatively impacted by the impairment charge of US$ 32.5 million related to the Yme MOPUstor™ (lower than provided for in the first half of 2009 due to variation orders agreed with our client), and an operating loss of US$ 25.1 million incurred on the tanker inventory which was laid-up for most of the year following the collapse of the trading market. This resulted in a decrease in EBIT margin to 21.4% (2008: 28.4%).
Non-allocated “Other” income and expenses amounted to US$ 31 million in 2009 (2008: US$ 17 million).
This mainly relates to the cost of general management and corporate functions, as well as the cost of various corporate improvement projects undertaken in 2009.
Net financing costs were 48.6% higher than in 2008 as a result of the start of the charters in 2008 of the FPSO Saxi Batuque and in 2009 of the FPSO Espirito Santo and Semi-Submersible Thunder Hawk.
Interest income fell sharply in 2009 with the reduction in short-term US interest rates.
The 2009 tax burden was US$ 3.7 million (1.6% of profit before tax), reflecting in particular small losses in the Dutch and US operations of the Company, combined with the relatively low tax burden elsewhere. This
compares to a net tax burden of US$ 9.4 million (4.0% of pre-tax profit) in 2008.
The consolidated result for 2009 is a net profit of US$ 230.0 million, a 0.9% increase in comparison with the 2008 net profit of US$ 227.9 million. This result includes non recurring sales of assets which generated a net
gain of US$ 32.4 million in 2009 (US$ 31.4 million in 2008). The net profit margin rose to 7.8% (7.4% in 2008).

Earnings per share amounted to US$ 1.47, compared to US$ 1.54 in 2008.
In November 2009, the Company raised € 180.7 million of fresh capital through a successful 9.2% equity issue.
Net debt at 31 December 2009 amounted to US$ 1,464 million with cash and cash equivalent balances of US$ 146.7 and committed, undrawn, long-term bank facilities of US$ 703 million. Net gearing reduced to 81% (year end 2008: 118%) providing significant financial headroom for growth.
The Company arranged new project finance facilities of US$ 350 million for EnCana Deep Panuke MOPU and US$ 200 million for Petrobras FPSO Cachalote relocation.
The total investment in fixed assets in 2009 amounted to US$ 656 million, which is much lower than in 2008 (US$ 1,000 million) due to the slowdown in order intake between mid 2008 and mid 2009;
New orders in the year totalled US$ 3,740 million (split 63% / 30% / 7% between the Lease and Operate, the Turnkey Systems and the Turnkey Services segments respectively), compared to US$ 4,366 million of new orders in 2008.
Total order portfolio at the end of the year was US$ 10,032 million compared to US$ 9,247 million at the end of 2008, an increase of 8.5%. Of this, 78% (2008: 68%) or US$ 7,834 million relates to the non-discounted
value of the revenues from the Company’s long-term lease contracts in portfolio at year-end.
More financial information is provided in the detailed financial analysis that can be found in the appendix.

2. Development Order Portfolio
2.1 Lease and Operate
The portfolio developed over the year as follows:
New orders and extensions:
• In June 2009, the FSO Unity operations contract has been extended by Total Exploration Production Nigeria Limited (TEPN) for 12 months up to 30 June 2010;
• In October 2009, Noble Energy awarded a contract for the provision and fifteen year Lease and Operate of an FPSO for the Aseng development offshore Equatorial Guinea confirming a Letter of Intent issued in August 2009. A Joint Venture between GEPetrol (40%) and SBM Offshore (60%) will own and operate
the unit;
• In December 2009, the Company received a Letter of Intent from Petrobras for the upgrade of the Company’s existing FPSO Espadarte and Lease and Operate contract for a period of 18 years on the Baleia Azul field offshore Brazil.
Start of operations:
• In June 2009, the Company started the three year operations contract following first oil production on the FPSO Frade for Chevron in Brazil;
• In July 2009, the FPSO Espirito Santo for Shell Brazil located in the BC-10 deep water field development in the Campos Basin offshore Brazil achieved first oil production. The Company will operate this vessel for fifteen years on a Lease and Operate contract in joint venture with MISC;
• In July 2009, the Company’s DeepDraft Semi™ production platform Thunder Hawk started operations under a minimum five year lease and production handling agreement for Murphy and other Producers in the Gulf of Mexico. The unit is fully owned by the Company but operated by Murphy;
• In August 2009, FPSO Capixaba was disconnected from Petrobras Golfinho field offshore Brazil, sailed to Singapore and started conversion works for re-deployment of the unit at the new Cachalote field offshore Brazil. The unit will be under contract with Petrobras for a twelve year Lease and Operate period which is scheduled to commence in April 2010.

End of lease contracts:
• In September 2009, The Company received notification of termination of the Lease and Operate contract of the FPSO Falcon from Esso Deepwater Limited, and the unit was redelivered in December;
• In June 2009, Petronas Carigali (Turkmenistan) Sdn Bhd exercised its purchase option for both the FSO and MOPU under the terms of the Service Agreement entered into with the Company in January 2005.

2.2 Turnkey Systems and Turnkey Services
The most significant awards during the year included:
• in April 2009, a contract was signed with Total for the engineering and supply of equipment for the Deep Water CALM buoy for the Usan OOL;
• in August 2009, a framework agreement was signed with Shell Global Solutions International BV for the supply of Turret Mooring Systems for Shell’s Floating LNG (FLNG) facilities;
• In December 2009, a FEED contract was signed with Petrobras for a FLNG FPSO for Brazil.

3. Operations
3.1 Lease and Operate
The MOPUstor™ platform for Talisman Yme is due for load out and transport to Norway from Abu Dhabi at the end of Q1 2010, as communicated earlier.
The construction of the MOPU for EnCana is in the assembly stage in the dry dock in Abu Dhabi and completion of the unit has been rescheduled to the second half of 2010 to enable scope changes to be implemented. This is not expected to change the commercial result for this project.
The Capixaba FPSO has completed upgrade works in Keppel shipyard in Singapore and has left the yard in February 2010, ahead of schedule, to sail back to Brazil

The operating fleet performed well and in certain cases generated substantial bonus revenues.
One of the Company’s tankers in inventory will be used for the Aseng development in Equatorial Guinea.
The three remaining tankers, plus one newly acquired VLCC, are currently laid-up and being proposed for new FPSO projects.

3.2 Turnkey Systems and Turnkey Services
In June 2009, the Company completed and delivered an external turret mooring system for an FPSO to be located offshore Vietnam on the Ruby field for Petronas/Petrovietnam;
The first portions of the turret for BP Skarv have been delivered during 2009 and the last portion will be completed at Keppel shipyard in Singapore in Q1 2010 in accordance with the schedule.
Petrobras P-57 FPSO vessel refurbishment and conversion will be completed at Keppel shipyard in Singapore and the vessel will sail to Brazil in Q1 2010. Thereafter topside integration will be undertaken at the BrasFELS yard before scheduled offshore installation in Q4 2010.
The Woodside Okha FPSO construction works are progressing according to plan at Keppel shipyard in Singapore with completion planned in the second half of 2010.

The drilling rigs construction is progressing with delivery of the three units scheduled in Q2, Q3 and Q4 of 2010 respectively. Provisions have been taken in the fourth quarter for the extra costs associated with these later delivery times.
The Company’s two installation vessels achieved high utilisation rates during the course of the year and other services activities were buoyant. The prototype subsea pile driving device (Pyrodriver) which had been in development for a couple of years has been discontinued. The associated costs (US$ 7.6 million) have been written off.

4. Market Developments
The slow down of new orders in the Company’s business segments which had started in 2008 continued well into 2009 with many projects either postponed or cancelled, even though bidding activity remained at a high level. In the latter part of the year there was some movement in the FPSO lease business with a few contracts awarded. The Company obtained two new important lease contracts representing the lion’s share of these awards. These new contracts are located in West Africa and Brazil, which are two of the key focus
areas for deepwater projects. Other significant developments were the award of a framework agreement from Shell for turret mooring systems for potentially a series of FLNG vessels and the first FEED order for a FLNG vessel for Petrobras in Brazil. These latter orders are considered to be important indicators in the development of the offshore floating LNG business, which the Company has targeted as a future growth area.
Despite the more stable higher oil price in the recent period and softening of project input costs there continues to be some hesitation from oil companies to go ahead with the sanction of new projects. Deep water oil and gas exploration continues and it is expected that the need to maintain production levels will result in a gradual release of new oil field project developments with activity picking up in the latter part of 2010. Many of these will be located in the deepwater areas where the Company concentrates its expertise
and effort.
The Company’s Turnkey Services business has been very buoyant in 2009, not being significantly affected by the lower oil price. Activity in this segment is expected to continue in the same way in the future, apart from the potentially lower utilisation rate of one of the Company’s vessels due to the near term absence of new FPSO installation work.
The Company’s Turnkey Systems business includes the supply of proprietary designs and equipment for the drilling rig and offshore construction industry. This business is picking up again in particular for the offshore wind farm installation sector.
The Company will continue to develop technology for deepwater oil and gas production, offshore LNG production and proprietary designs for the offshore drilling and construction industry.

5. Dividend proposal
The Company’s proposal is to return to the usual dividend pay-out ratio of 50% of net profit, with the choice of payment of the dividend in cash or in shares of SBM Offshore at the election of each shareholder. Based on a 2009 Net Profit of US$ 230 million and taking into account the increased number of shares, the proposed dividend is US$ 0.67 per share compared to US$ 0.93 in 2008, when exceptionally, a higher payout ratio was applied.
As in previous years, the annual dividend will be calculated in US Dollars, but will be payable in Euros. The conversion into Euros will be effected on the basis of the exchange rate on 14 April 2010. The conversion
ratio for stock dividend will be determined on 7 May 2010, after the close of the Euronext Amsterdam stock exchange and will be based on the volume weighted average price of all traded ordinary shares for the period of 3 – 7 May 2010.

6. Outlook 2010
The Company anticipates the following developments in 2010:
• Turnover to be in the same range as 2009;
• Average EBIT margin in the Turnkey Systems segment is expected to be solidly within the 5% - 10% range;
• Turnkey Services average EBIT margin expected around lower end of 15% – 20% range due to potentially lower utilisation rate for one installation vessel;
• The EBIT contribution from the Lease and Operate segment is expected to be below the level achieved in 2009 due to the end of certain lease contracts in 2009 and lower expected operating bonuses;
• Net interest charge will increase by up to 20% compared to 2009 due to start of operations on major lease contracts and low expected interest income on liquidities;
• Capital expenditure, excluding any new operating lease contracts to be obtained in 2010, is expected to amount to around US$ 0.5 billion;
• Net gearing at year-end 2010 is expected to remain below 100%, with all financial ratios well within banking covenants.