Petrofac Limited

Delay to publication of 2023 results, Update on restructuring and Trading Update - Seite 2

The Company is in active discussions with credit providers to obtain the required guarantees, which would also release over US$200 million of collateral and retentions, and will provide an update on the outcome of those discussions as appropriate.

This development comes as the Company continues to manage its payment obligations to preserve liquidity whilst progressing the other components of the restructuring with other stakeholders.

The Group’s upcoming payment obligations include amortisation payments due on the Company’s bank facilities and the coupon payment due on its senior secured notes on 15 May 2024.

The Company’s lending banks have agreed to a number of rolling short term deferrals of contractual amortisation payments while the Company progresses the financial restructuring. The Company continues to engage with its lending banks on extending these deferrals as required.

The Company does not expect to make the payment of the bond coupon on the due date of 15 May. The payment has a 30-day grace period. The ad-hoc group of noteholders, representing approximately 41% of the outstanding notes, has entered into a forbearance agreement with the Company, which provides an assurance that those noteholders will not take any action in respect of the non-payment of the coupon until at least 30 June 2024, in order to provide time for the Group’s financial restructuring to be progressed. The Company will seek to engage with other noteholders in the coming weeks.

Managing these payment obligations is of critical importance to the Company’s ability to maintain sufficient liquidity in the short-term while it is working to implement the financial restructuring.

Good progress is also being made with non-core asset disposals, with non-binding offers received for the Group’s share in the PM304 Production Sharing Contract (PSC) in Malaysia, the process for which could be completed in Q3 2024. Offers are in line with the value of anticipated cash flows (subject to oil price and oil premium assumptions) over the remaining term of the PSC which expires in September 2026.

Trading Update

In its Trading Update of 20 December 2023, the Company highlighted a risk in relation to the timing of the negotiations on the Thai Oil Clean Fuels project. Petrofac and its joint venture partners remain engaged with its client in relation to the reimbursement of additional project costs. At the time of reporting the full year 2023 results, management does not expect to have progressed discussions sufficiently to recognise the expected outcome of the negotiations in its accounts. As a result, the Company expects to recognise an incremental loss in its E&C division of approximately US$130 million for 2023.