dea group · re-calculation m&a acquisition of njord ... letter of credit to cover dea’s...

DEA GroupQ1 2017 Results PresentationThomas Rappuhn – CEO of DEA Deutsche Erdoel AG, Managing Director L1E Finance GP GmbH

Dmitry Avdeev – CFO of DEA Deutsche Erdoel AG, Managing Director L1E Finance GP GmbH

May 11th, 2017

DEA Group

Disclaimer

Forward-Looking Statements

This communication may include projections and other “forward-looking: statements within the meaning of applicable securities laws, which are based on current expectations and projections about future events and financial

performance. Statements herein, other than statements of historical fact, regarding future events or prospects, are forward-looking statements. The words “may”, “will”, “should”, “expect”, “anticipate”, “believe”, “estimate”, “plan”,

“predict”, “intend” or variations of these words, as well as other statements regarding matters that are not historical fact or regarding future events or prospects, constitute forward-looking statements. L1E Finance GmbH & Co KG (the

“Company”) has based these forward-looking statements on its current views with respect to future events and financial performance in addition to certain assumptions about the future, some of which are beyond the Company’s

control. These forward-looking statements involve a number of risks, uncertainties, and assumptions about the Company and its subsidiaries and its investments, including, among other things, the development of its business, trends

in its operating industry, and future capital expenditures and acquisitions. In light of these risks, uncertainties and assumptions, actual results may not occur or may differ materially from those predicted in the forward-looking

statements and from the past performance of the Company. As a result, you should not rely on these forward-looking statements. Neither the Company nor any other person make any warranties or representations about accuracy,

sequence, timeliness or completeness of the content of the presentation or the achievement or reasonableness of future projections, management targets, estimates, prospects or returns, if any.

Non-GAAP and Non-IFRS Financial Measures

This communication may contain certain non-GAAP and non-IFRS measures and ratios, including for example EBITDAX, net debt, net working capital, coverage ratios and EBITDAX per boe that are not required by, or presented in

accordance with, any GAAP or IFRS.

The non-GAAP and non-IFRS measures and ratios may not be comparable to other similarly titled measures of other companies and have limitations as analytical tools and should not be considered in isolation or as a substitute for

analysis of our operating results as reported under IFRS or any GAAP. Our management uses these measures to measure operating performance and liquidity, in presentations to our Management Board and as a basis for strategic

planning and forecasting, as well as monitoring certain aspects of our operating cash flow and liquidity. We present non-GAAP and non-IFRS measures and ratios because we believe that they and similar measures are widely used by

certain investors, securities analysts and other interested parties as supplemental measures of performance and liquidity. Non-GAAP and non-IFRS measures and ratios such as EBITDAX, coverage ratios and EBITDAX per boe are

not measurements of our performance or liquidity under IFRS and should not be considered as alternatives to operating profit, profit for the year, capital expenditure or any other performance measures derived in accordance with IFRS

or any GAAP or as alternatives to cash flow from operating, investing or financing activities.

We present in this communication a reconciliation of each of the non-GAAP and non-IFRS measures to the most directly comparable measure calculated and presented in accordance with IFRS and discuss its limitations

See note above.

Some of the limitations of EBITDAX are:

• they do not reflect our cash expenditures or future requirements for contractual commitments;

• they do not reflect changes in, or cash requirements for, our working capital needs;

• they do not reflect the significant interest expense, or the cash requirements necessary, to service interest or principal payments on our debt;

• although depreciation and amortization are non cash charges, the assets being depreciated and amortized will often need to be replaced in the future and EBITDAX does not reflect any cash requirements that would be required to

make such replacements;

• they do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and

• other companies in our industry may calculate these measures differently from the way we do, limiting their usefulness as comparative measures.

Because of these limitations, EBITDAX should not be considered as measures of discretionary cash available to us to invest in the growth of our business or as measures of cash that will be available to us to meet our obligations. You

should compensate for these limitations by relying primarily on our IFRS results and using these non-GAAP and non-IFRS measures only to supplement your evaluation of our performance.

May 2017 | Q1 2017 Results Presentation

DEA Group May 2017 | Q1 2017 Results Presentation

Q1 2017 Highlights

Production

132 kboe/d

EBITDAX

€211 million

Production Costs

$6.0 / boe

Projects

West Nile Delta First Gas Achieved

Njord PDO Submitted

Debt Financing

RBL Available Amount

Unchanged at $2,300m post

re-calculation

M&A

Acquisition of Njord package

closed on April 28th


West Nile Delta Development

Well established position in Norway

First Gas Achieved

West Nile Delta (“WND”) first well was successfully started up ahead of

schedule on 24th March 2017

Wet gas rates are already exceeding 700 mcf/d (gross), more than the

planned production rates for these fields

Letter of Credit to cover DEA’s share of revenues received from a top

Egyptian bank

Capex savings of Taurus and Libra development reached a significant

reduction in costs compared to the initial budget due to:

Excellent drilling and completion performance

Cost deflation

Foreign exchange movements

Development of Giza, Fayoum and Raven (“GFR”) fields is well on track

to reach production start in H1 2019


DEA Group(1) Highlights Q1 2017

(1) DEA Group consists of L1E Finance GmbH & Co. KG and its subsidiaries

(2) Working interest production

(3) Includes hedges and physical forward sales

(4) EBITDAX defined as income before tax, financing costs, exploration expense, DD&A and impairments, acquisitions,

disposals, extraordinary items, minority interest, FX gains and losses, pensions, loss or gain in relation to disposal of fixed

assets

(5) Capex excludes financial asset capex and excludes capex from discontinued operations and acquisitions

(6) Free cash flow comprises of cash flows from operating activities and from investing activities, but excludes cash flows from acquisitions

Note: Certain numerical figures and percentages set out in this presentation have been subject to rounding adjustments

Q1 2017 Q1 2016

Production(2) (kboe/d) 132 153

Realized oil price(3) ($/boe) 49 38

Realized gas price(3) ($/mcf) 5.0 5.2

Revenue (€m) 389 381

Production costs ($/boe) 6.0 7.9

Exploration costs (€m) (11) (10)

EBITDAX(4) (€m) 211 188

Net income (€m) (35) (7)

Capex(5) (€m) 184 126

Free cash flow(6) (€m) (13) (20)

Net debt (€m) 1,769 -


3842 43

4649

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017

Production Profile (kboe/d)

Production and Pricing

Commentary

Realized Gas Price ($/mcf)

Q1 2017 production was 132kboe/d, 14% lower compared to the same

period last year due to planned shut-in of Njord in May 2016 and natural

decline in Egypt. April 2017 production averaged 146kboe/d(1) due to

West Nile Delta production commencement ahead of schedule and

strong performance of the Norwegian fields

Q1 2017 realized oil price was $49/bbl, 29% higher than in Q1 2016. Q1

2017 realized oil price was about 17% higher compared to average price

for the year 2016

Q1 2017 realized gas price was $5.0/mcf, 4% lower than in Q1 2016. Q1

2017 realized gas price was about 2% higher compared to average price

for the year 2016

Realized Oil Price ($/bbl)

2016 Quarterly Realized Oil Price 2017 Quarterly Realized Oil Price 2016 Quarterly Realized Gas Price 2017 Quarterly Realized Gas Price

41 41 39 37 41 40 39

44 41 37 34 30 2844

3171

6654 60 64

63116

153142

125 131 132146

FY 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Apr-17

Germany/Denmark North Africa Norway

5.2

4.6 4.7

5.35.0

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017

(1) Preliminary figure

44%

56%

% oil:

% gas:

43%

57%

44%

56%

45%

55%

39%

61%

44%

56%

45%

55%

DEA Group

7.9

6.0

Q1 2016 Q1 2017

139 124

37 28

205 237

381 389

Q1 2016 Q1 2017

Germany/Denmark North Africa Norway

104 73

(10) (13)

121 174

(27) (23)

188 211

Q1 2016 Q1 2017

Germany/Denmark North Africa Norway Other


Revenues and Profitability

EBITDAX (€m)

Gross Revenues (€m)

Average Production Costs ($/boe)

% margin

Commentary

Q1 2017 revenues of €389m up 2% compared to the same period last

year as lower production was offset by higher oil prices

Q1 2017 EBITDAX of €211m was 12% higher compared to Q1 2016 due

higher revenues and lower costs, despite higher impairments of Egyptian

receivables (€25m vs. €11m)

Norway was the main contributor to the EBITDAX growth while

profitability in Germany declined due to lower hedge effect

Q1 2017 production costs decreased by 24% from $7.9/boe in Q1 2016

to $6.0/boe. The decrease is attributable to cost reduction programs, the

depreciation of the Egyptian Pound and weaker Euro

Note: Production costs include G&A allocation but exclude export and processing tariffs,

finance items and R&D (1)Incl. rest of the world, central functions and investment property

54%

(1)

49%

DEA Group

214

88114

16

66

1

126

184

Q1 2016 Q1 2017

Germany/Denmark North Africa Norway Other

Capex Breakdown (€m)

Capital Expenditure


(1)Incl. rest of the world, central functions and investment property

(1)

Norway: mainly Dvalin and Njord

expenditures related to start up of

projects

Egypt: WND expenditures peaking

ahead of first gas in Taurus/Libra and

ramp-up of development in

Giza/Fayoum/Raven fields

Algeria: last two quarters of

significant capex remaining before

production commencement

DEA Group

Cash Position Development

Cashflow Bridge (€m)


104

170(183)

(3)

88

Cash 01/01/17 Cash Flow from Operations Cash Flow from Investment

Activities

Cash Flow from M&A and Other Cash 31/03/17

DEA Group

400 400

2,551

1,873

405 405

1,769 1,769

2,151

88

766

1,452

88

Senior UnsecuredNotes

RBL Cash Available Liquidity Senior UnsecuredNotes

RBL (drawn) Cash Net Debt31/03/2017


Liquidity and Net Debt

(1) Nominal value

(2) Balance sheet amount (net of amortized fees), including accrued interest

FX rate used USD/EUR 1.0691

Net Debt (€m)Source of Liquidity (€m)

(1) (2)

(2)

(1)

DEA Group

Hedging Overview

Hedged

Volumes

Oil (as of April 30th, 2017)

2017 2018 2019

Volume

(mmbbl)3.4 3.4 1.4

Price ($/boe) 52.7 54.7 57.7

% of Target

Hedging

Volume

100% 100% 45%

Gas (as of April 30th, 2017)

2017 2018 2019 2020

Volume

(bcf)50.0 24.5 19.4 3.0

Price ($/mcf)(1) 6.0 5.8 5.5 5.6

% of Target

Hedging

Volume

>100% >100% 100% 11%


(1) Calculated at the exchange rates applicable on April 30th, 2017

dea group · re-calculation m&a acquisition of njord ... letter of credit to cover dea’s...

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