2.1.6Economic Performance


SBM Offshore’s primary business segments are: Lease and Operate; and Turnkey. Although financial results are presented per segment, activities between business segments are closely related. In addition to reporting under International Financial Reporting Standards (IFRS) guidelines, SBM Offshore’s directional reporting methodology was introduced to reflect Management’s view of SBM Offshore and how it monitors and assesses financial performance. This chapter of the Annual Report presents numbers based on directional reporting.

SBM Offshore provides Directional Revenue and EBITDA guidance, which is updated in the event of material change, if any. Economic performance is a result of all company activities, governed as per sections 3.1 and 3.2 and executed as per the Management Approach sections in chapter 2.


Economic performance is measured through profitability, cashflow, backlog and the financial position of SBM Offshore.


Adjusted for non-recurring items, Underlying Directional revenue for full-year 2022 came in at US$3,288 million, an increase of 42% compared with 2021. This increase is mainly driven by the Turnkey segment increasing to US$1,525 million (US$733 million in 2021) benefiting from the general ramp-up of Turnkey activities, with five FPSO’s under construction (and completion of FPSO Liza Unity) in 2022. Furthermore the partial 45% divestment on two projects at the beginning of 2022 (FPSO Almirante Tamandaré and FPSO Alexandre de Gusmão) allowed SBM Offshore to recognize revenue for all the EPCI related work performed on these projects so far to the extent of the partners' ownership in lessor related SPV's (i.e. 45% of EPC works). Underlying Directional Lease and Operate revenue was US$1,763 million an increase versus US$1,584 million in the prior period. This mainly reflects FPSO Liza Unity joining the fleet upon successful delivery of the EPCI project partially offset by the end of Deep Panuke MOPU and FPSO Capixaba lease contracts in 2022.

Underlying Directional EBITDA amounted to US$1,010 million in 2022 compared with US$931 million in 2021. This increase is driven by the Lease and Operate EBITDA which increased from US$989 million in 2021 to US$1,080 million in 2022 mainly resulting from the same drivers as for the Underlying Lease and Operate revenue.

Although SBM Offshore recorded a significant increase in the Turnkey revenue related to projects under construction, there was not a commensurate impact on EBITDA due to several factors :

  1. (Direct payments received during construction on FPSO Liza Unity, FPSO Prosperity and FPSO ONE GUYANA (being 100% owned by SBM Offshore) were recognized as revenue without contribution to gross margin in accordance with SBM Offshore's policy for Directional reporting;
  2. Following the partial 45% divestment in FPSO Alexandre de Gusmão and FPSO Almirante Tamandaré, the first 25% of progress on the EPCI related work have been recognized without associated margin as per SBM Offshore "stage of completion" policy (associated margin being spread over the remaining construction period and finally
  3. On SBM Offshore's overall project portfolio, strategic mitigation measures against inflation have been proving effective on controlling cost and protecting schedule. Nevertheless, parts of the portfolio remain sensitive to the pressure in the global supply chain as a result of the war between Russia and Ukraine and the continuing impact from the COVID-19 pandemic.

As a result, Underlying Directional Turnkey EBITDA decreased from US$19 million in the year-ago period to US$7 million in the current year.

2022 Underlying Directional net income attributable to shareholders stood at US$115 million, a decrease compared with US$126 million in the previous year. Despite strong operating performance translated in the increase of Underlying Directional EBITDA , net income was negatively impacted by the FPSO Cidade de Anchieta impairment (US$92 million) following the shutdown of the vessel and the capitalization of associated repair costs.

The above Underlying figures are adjusted for some non-recurring items described in section 4.1.3.

Cash Flow/Liquidities

Thanks to the strong contribution of the fleet, SBM Offshore generated US$799 million of net cash flows from operating activities over 2022.

These operating cash flows and drawdowns on project financing together with some of SBM Offshore’s existing cash was primarily used to: (i) invest in the five FPSOs under construction and Fast4Ward® new build multi-purpose hull; (ii) transfer partial excess of cash in FPSO Almirante Tamandaré and FPSO Alexandre de Gusmão SPVs to partners following the 45% divestment of shares; (iii) return funds to the shareholders through dividends; and (iv) service SBM Offshore’snon-recourse debt and interest in accordance with the respective repayment schedules.

As a result, cash and cash equivalents decreased from US$1,059 million at year-end 2021 to US$615 million at year-end 2022.


The Directional backlog, which is presented on a pro-forma basis in section 4.1.3, increased to a record total of US$30.5 billion at December 31, 2022, compared with US$29.5 billion at year-end 2021.

This increase was mainly the result of the awarded contract for the FPSO ONE GUYANA project partially offset by the turnover for the period, which consumed US$3.3 billion of backlog. SBM Offshore’s backlog provides cash flow visibility of 28 years, up to 2050.

Statement of Financial Position

SBM Offshore’s financial position has remained strong as a result of the cash flow generated by the fleet and the successful adaptation of the Turnkey segment to a more competitive and unpredictable market.

Directional shareholders equity increased from US$604 million at year-end 2021 to US$1,078 million at year-end 2022. This was primarily due to (i) an increase of the hedging reserves of US$510 million; (ii) a positive net result of US$115 million in 2022; and (iii) dividend distributed to the shareholders decreasing equity by US$180 million.

It should be noted that under Directional policy, the contribution to profit and equity of the substantial FPSO program under construction will largely materialize in the coming years, subject to project execution performance, in line with the generation of associated operating cash flows.

Directional net debt increased to US$6,082 million from US$5,401 million at year-end 2021. While the Lease and Operate segment continues to generate strong operating cash flow, SBM Offshore drew on project financing to fund continued investments in growth.

The majority of SBM Offshore’s debt as of December 31, 2022 consisted of non-recourse project financing (US$3.7 billion) in special purpose investees. The remainder (US$3 billion) mainly comprised of borrowings to support the on-going construction of five FPSOs, which will become non-recourse following project execution finalization and release of the Parent Company Guarantee. SBM Offshore’s Revolving Credit Facility (RCF) was undrawn at year end and cash and undrawn committed credit facilities amounted to US$3,037 million.

For a total overview of SBM Offshore’s financials under IFRS, please see section 4.2 of the Annual Report.