Good morning, everyone. Thank you for joining us at Seatrium's 1Q 2026 business performance update.

My name is Amelia and I take care of Investor Relations for Seatrium. This morning, we have with us our CEO, Mr.

Chris Ong, and CFO, Dr. Stephen Lu.

Before we jump into Q&A, Chris and Stephen will start off with some opening remarks. Chris, over to you, please.

Good morning and thank you for joining us today. Before we move into Q&A, I'd like to offer some quick comments on our 1Q 2026 business and operational performance, key developments, and management's view on outlook and priorities.

We continue to make progress into 1Q 2026. We execute strongly, converting order book into revenue, and ongoing projects continue to advance in line with expectations.

Our net order book stood at S$15.5 billion as at 31st of March 2026, offering near-term earnings visibility with deliveries through to 2033. We continue to see improvements in gross margin performance as project mix improves, and through cost and operational efficiencies resulting from ongoing initiatives, which Stephen will elaborate on this effort shortly.

The other part I'd like to bring your attention is also to our diversified order book today. It consists of higher quality projects.

During the quarter, we delivered two legacy projects: the trailing suction hopper dredger in the U.S., which is the largest Jones Act compliant hopper dredger built in the United States delivered to Manson Construction; and the wind turbine installation vessel, a next-generation wind turbine installation vessel delivered to Maersk Offshore Wind. This brings our non-FPSO legacy projects to about 1% of our net order book.

Additionally, more than 95% of our net order book today are series-built projects. This give us confidence with this improving mix of projects that will progressively contribute to further margin improvements as well as lower execution risk.

The macro environment today is supportive, and we will leverage on our competitive edge and leadership to pursue our robust pipeline of global opportunities. Themes around energy security and energy transition have become more prominent, and the elevated oil prices provide a supportive environment for offshore energy infrastructure investments.

Customer remain disciplined in their capital deployment, placing strong emphasis on capital efficiency, risk-sharing arrangements, and project economics. Our diversified business and track record across traditional, transition, and green energy affords us the ability to pursue a wide breadth of opportunities.

While FID timing is not within our control, we believe that we are well-positioned to capture this pipeline opportunities, leveraging our strong competitive position, track record, and global scale. The slight reduction in pipeline number to close to $30 billion mainly reflects removal of full EPC scope for Sepia 1 from what we last disclosed in financial year 2025 results.

Nonetheless, key opportunities last disclosed remains mostly intact. It consists, for example, South America remains a key market for oil and gas projects that includes Brazil and Guyana, and we continue to pursue HVDC opportunities in Europe and HVAC opportunities in Asia, as well as emerging FLNG opportunities in Africa and fixed platforms in the Middle East.

In 1Q 2026, we secure our eighth FSRU conversion projects from Karpowership, the first of the three FSRU conversion projects under an earlier letter of intent, which also comprised the integration of up to six new generation power ships. Beyond Karpowership LOI, we see growing demand for FSRU and FLNG conversion projects, driven by a confluence of factors including energy security, capital efficiency, transition dynamics, and speed of deployment.

We've established our global leadership in complex conversion projects, which we will position ourselves well to capture these high-value projects. We will provide more in-depth update on the pipeline opportunities during our first half 2026 results briefing.

Executing well and replenishing our order book remains a priority in 2026 to extend near-term earnings visibility into financial year 2027. Currently, our repair and upgrade business continues to enjoy strong repeat businesses, offering a relatively stable earning moat.

In financial year 2026, we reiterate our commitment to long-term shareholder returns, supported by sustainable long-term growth. We continue to focus on driving margin efficiency through improving project mix, continued cost discipline, and strategic divestment, replenishing order book with high quality contracts that meet our mid-teens risk-adjusted hurdle rates and progressive milestone payments requirement.

Concurrently, we will continue to strengthen our leadership and breadth of solutions relating to emerging energies, decarbonization, and digitalization of operations and assets. This will secure our business relevance and competitiveness as the global landscape evolves.

With that, I will hand over to Stephen before we move into Q&As.

Thank you, Chris. Good morning, everyone.

As we'll be disclosing our full set of numbers only in 1H 2026, but I'd like to share some broad comments on our progress this quarter. We continue to progress in 1Q 2026 with gross margin continued to strengthen, driven by an improved project mix, lower overheads partly contributed by the completed divestments, lower G&A expenses resulting from rigorous risk management, productivity gains, and cost control initiatives.

Balance sheet remained robust in 1Q. We also made progress in proactively managing our borrowings.

The successful establishment of our $3 billion MTM program alongside our inaugural $400 million 2.95% senior unsecured issuance, which was met with strong institutional demand, signals the market's confidence in Seatrium. The funds raised will be used to diversify the group's funding sources and lengthen maturities.

We have completed all non-core asset divestments announced to date. These divestments include the AmFELS yard, Crescent yard, Karimun yard, as well as other assets, and the completion of the tugboat fleet divestment in April 2026.

These are non-core assets and do not impact our capability nor ability to take on new projects. These divestments, together with prior transactions, are on track to unlock more than S$50 million in annualized operational cost savings and more than S$330 million in cash proceeds post-completion.

This reduces unproductive overheads and allows management to focus resources on higher-value core activities. As disclosed during FY 2025, we have identified further non-core divestments that will elevate the strategic benefits that I elaborated on earlier and unlock value for both the business and for our shareholders.

To close, we remain on track to achieve our FY 2028 steady-state targets, and we have made progress to steadily improve our margins, and our order book and pipeline remain strong. We continue to strengthen our balance sheet, underpinned by higher quality projects and an improving credit profile.

With that, let's move to the Q&A session.

Thanks, Stephen. We'll now open the floor to questions.

For those of you who have a question for us, please raise your hand to ask a question. We have our first question from Louis.

Hi. Good morning, and thanks for the update.

I had three questions initially. The first is regarding the target pipeline that you've disclosed of S$28 billion.

What is the cause for the differential versus the S$32 billion that you disclosed previously? Is it because the projects have gone to other parties, or simply because the projects have not pushed through at all?

Which sector was primarily impacted by that change? The second question is if you could give us a overview of potential major award timelines, major project timelines in the next 6 to 12 months from your major clients.

Some insight on that would be great. The last question is on the impact of the overhead cost savings.

As you mentioned, the tugboat sale was just completed April, essentially the bulk of that S$50 million annualized savings, we should see it as early as the first quarter? Thanks.

Thanks, Louis. I will take the first one.

I don't think we need to read too much into drop and increase because that's only reflecting on the tendering process and our targets. This S$4 billion drop is mainly due to Sepia 1, which was announced that SBM has won it.

Saying that, at the same time, we will also work with them to take a look at how we leverage on work for Brazilian and the rest of the yards. Just on that, your next question is major timeline.

We do not comment on award timelines. Rather, what we can control is actually on the tender timeline.

If you take a look for the next 6 months, 6 to 12 months, we are actually chasing more than $15 billion of orders that with our customers had put in the market.

Of course,

after tender, there are other activities like negotiation, terms and conditions, and all this. Suffice to say, there's no lack of activities at this present moment, and our marketing people are very, very busy.

Great, Chris. Just a quick follow-up to the 15 billion.

Is it mostly in oil and gas or offshore wind?

It's a mix.

Yeah. There are FPSOs, some announced tenders, some not public.

There are also conversion projects like FLNGs, FSRUs. There's also offshore wind topside, substation.

There's a good mix. That's the reason why we mentioned that, well, in this market, whether it is energy security or energy transition, it is actually a blurred line today because of the market environment, I think many of the governments are taking a look at their energy policy moving forward.

Louis, on your third question around the recognition of overhead savings, as you rightly pointed out, it will progress as we complete. As we have completed our last transaction that we've announced so far in April 2026, all the savings can be baked in from, I guess, 2Q onwards.

Thanks, Stephen. Just a follow-up to that.

Any progress on the other divestment targets? Do you see it within this year, or is it more for next year?

As we are targeting more than S$200

million

book value worth of divestments. The active process is ongoing, I can't comment on exactly what they are, but we are targeting to sign this year.

Okay. Thanks a lot.

Thanks, Louis. Next up we have Zhiwei.

Zhiwei, please unmute yourself.

Hi. Good morning.

Thanks for the presentation. I have two questions.

The first one is on your, well, quarterly revenue run rate, right? If I were to just do some calculations, I'm getting to around S$3 billion quarterly revenue run rate for this quarter.

Should we expect the same cadence of revenue recognition going into the future quarters based on your existing order book, and or should we expect that to be different, right? Then if the revenue is going to be coming off in future quarters based on the current order book, how do we think about margin?

By margin, I mean the gross margin. That's the first question.

Now on the second question, it's more on your pipeline, right? Given what has happened in the Middle East and your exposure to enabling customers with the energy transition, especially in wind, have you seen an acceleration in discussions or expansion of the whole renewable energies pipeline from your customers who want to build these structures?

Thank you.

Thanks, Zhiwei. A lot to unpack there.

I think it's almost a strategy session already. Okay.

The first thing is about the $3 billion. I think the amount would roughly hover around there.

We have clocked sometimes a quarter with $2-plus billion to $3 billion. It really depends because various projects at different stages.

I think that we should read that projects are executed well along the way. If you take roughly north of $2 to $3 billion, I think that would be the usual run rate in terms of capacity.

Now your question around, well, enabling our customers and also the Middle East, and do we see any trends? I would rather say that at this present moment, as I mentioned just now, the definition of energy security and transition, certain transition projects have become important and it's as energy security topic, vice versa.

We see that there are ongoing focus around each of the nation's energy security plans. One of the most obvious trend that we are looking at is that there's probably an increased discussion around FSRU conversion because of speed to market.

Thanks. Sorry, one follow-up, please.

I appreciate your guidance on the north of $2 to $3 billion. Based on your order book, right, and your build plan, can we expect that north of $2 to $3 billion to be that run rate for the rest of 2026?

It will hover somewhere around there.

Great. Thank you.

All right. Thanks, Zhiwei.

Next up we have Rachel.

Hi. Good morning.

This is Rachel from UBS. Understand that your reduced order book is due to the removal of the full EPC contract for Sepia 1.

In your updated order book, have you included the potential for Brazilian yards and other scope? Could you elaborate more on what sort of opportunities you can work with SBM for Sepia 1?

Oh, I think there's a difference between order book and pipeline.

Sorry. Sorry.

Sorry, I mean pipeline. Pipeline.

Sorry.

Pipeline. Pipeline largely increase what we are chasing, but when it comes to subsequent scope, I think it's very difficult for us to estimate, and that is not included inside the amount, purely because it largely depend Of course, we will work with SBM to provide solutions for whatever that they have.

On top of Sepia 1, it is in the news that even Guyana, their activities. The key thing is about the breakdown of scope is an ongoing discussion.

Okay. Thanks very much.

Yeah. Sorry, yeah, those are all my questions.

Thanks.

Okay. Thanks, Rachel.

If you have anything else, you can raise your hand again. Okay.

Next up we have Siu Kei.

Hi. Good morning, Chris and team.

I think I wanted to just ask on margin because you said that it has actually improved, but just wanted to hear your thoughts on compared to second half, it has actually improved. Is it mainly because just on normal execution of projects or just is provision for certain costs, why did it improve from second half?

Siu Kei, maybe I'll take that. I think we've covered that quite a lot in the full year results, but as we sort of continued into the quarter, we saw the momentum on the margin improvement, basically the same factors that we talked about before, right?

If I were to briefly recap, is one is the improved project mix. As you've mentioned, consistent requirement around mid-teens risk-adjusted margins post-merger.

As Chris mentioned earlier, we have about 1% of our of our order book being the legacy non-FPSO projects. Two, I think the other part was around lower overheads due due to better productivity as well as the divest divestments that we've completed.

I think in the full year sorry, in the first half 2026, we'll share more detailed financials. As we move forward, we are also improving our cost structure through the divestments as well as other productivity initiatives.

Okay. It's project mix.

I missed the mid-teens adjusted something.

The mid-teens risk-adjusted project margins that we have been targeting post-merger.

That has always been there. It's better project mix and also just lower overhead cost and better productivity because you actually saved money from whatever cost it needed to incur from divestment.

Because of divestment, you actually manage your safe cost. Can.

Just wanted to just check if there was any updates on any litigation or any negotiation with any clients or updates on any litigation that you can just share with us. I know you will say, "We'll let you know when there's something," but just want to hear if there was any progress.

Siu Kei, there's no further updates since the last quarter. I think we published all the major litigation that we are undergoing.

Right now they are all at various stages, and I think that some of them are at the stage where decision will be made, arbitration ruling will be made, but we don't have further updates at this point.

Okay. Thank you.

Thanks, Siu Kei. Louis, you had another question for us?

Louis, are you there?

Hi, thanks. I think I was muted.

Sorry, just one housekeeping question. Now that you've completed this set of non-core divestments, what's the one-off gain that you're going to book in the first half?

I think we disclosed that in the full year, but if you took out the divestment that we completed last year, which is the GNL vessels, you're looking at net of tax about S$100 million.

Great. Thanks, Stephen.

Thanks, Louis. Next up we have Toby.

Toby, are you there? Toby?

Otherwise, I think Toby has indicated questions on the chat. The first question is on global interest rates.

If it remains elevated, are we concerned that this could lead to higher financing costs? The second question is on the rise in defense spending globally.

Is Seatrium looking to pursue more orders or contracts in the defense sector? Maybe Stephen can take the first question.

I'll take the first one. As we've been diversifying our group funding sources, and as of Q1, we brought down our average cost of debt while also lengthening our debt maturity with the inaugural issuance of $400 million note.

I think, importantly, we're also looking to delever over time as we're able to do so. I think that's the most effective way to guard against rising interest cost.

I'll take the second question around defense. Defense is a very important sector for us, mainly in our R&U part.

It does take up quite a good amount of our revenue contribution. Just for your interest, we actually not only have the Singapore Navy as our clientele in terms of track record.

We do have the Australian, other places like Australian, New Zealand, the UK, and the US Navy as our usual clientele. The answer is yes, we are looking actively at this sector.

Okay. I hope that answers your question, Toby.

If not, please let us know. In the meantime, let's go to Amanda.

Amanda?

Morning. Hi, good morning.

Can you hear me?

Yes.

Yes. Hi, Amanda.

Please go ahead.

Thank you very much. Just one question, please, if I may.

We saw on vessel tracking data that there is an FPSO, Berantai, from Vestigo Petroleum, en route to Seatrium for refurbishing work. I just wondered how in terms of planning and also in terms of sort of rate of return it works out for Seatrium having an FPSO in to be refurbished versus one that is a new build, please?

Oh, Amanda, actually, I didn't hear exactly which FPSO you are referring to. Just as a general guidance, I think the refurbishment of FPSO falls under the R&U segment, and usually we don't guide based on each project, but each of the segment.

As we mentioned, the R&U segment usually we do have quite a good margin spread.

Thank you very much.

Thanks, Amanda. Next up we have Siu Kei.

Hi. Can we just get a refresher on your input cost and how you manage that?

Just wanted to just check if there was any escalation clause, if there was any increase in overall cost that you can actually pass through because of the war. Just wanted to just see how you manage it.

This is a very wide question, Siu Kei, but I think each of the contracts are unique. If we start with those turnkey pure EPC contracts, that is a case-to-case.

If there are avenue to pass through a VO because of change of specs, it usually happens. When you talk about cost-plus element to it, sometimes cost-plus plus schedule impact are considered.

Most of the raw materials indexes like steel and all this are embedded inside the contract, but suffice to say, most of the contracts that we have, usually they are procured quite upfront in the project, we see minimal impact. I think the war impact itself, we are watching the supply chain.

Project procured item, usually what will impact is the transportation route. Energy cost largely under contract beyond this year, so far no impact visible to us.

Okay. Thanks.

Thanks, Siu Kei. Next question from Adrian.

Adrian, are you there?

Hi. Can you hear me?

Yes, we can hear you now.

Sorry. Apologies.

I dialed in slightly late for this, hopefully this question hasn't been asked yet. Just wanted to get an update on the renewable situation now that the Iran war is in full flight.

Has there been a lot more inquiries for offshore wind, obviously? My second question is around the repairs and upgrade segment.

How has the Iran war changed the landscape? Have you seen also an increase in the number of vessels asking for, I guess, repairs and upgrades, especially for repairs, maybe for the cruise liners?

Thank you.

Thanks, Adrian. First thing first, I guess the war, Middle East, your question is around renewables.

Our take on this is again that the theme around security and transition is blurred and is teaming between the two because depending on which geography you're talking about, we see that the energy agenda is topmost priority in many, many of the geographies today because of the issue on disruption of supply for oil and gas. The two things that we see right now in the market, I think that the ambition around renewables, especially in Europe, would probably be a lot more heightened, whether it's a security question or transition question.

That's besides the point. Of course, certain geographies will have to get their lease and development structure correct.

Of course, Asia, as usual, Taiwan dominates and Japan dominates the venture. Now, you also question about R&U because of Middle East.

I think short term-wise, definitely there are some rerouting, especially when the Middle Eastern yard are out of action. I think that that's a short-term thing.

We still have to make sure that we are competitive and add value to our customers. Then for R&U in terms of FSRU conversion, I mentioned just now, our believe is that there will be a lot more short-to-medium interest around conversion of FSRU because that's the shorter cycle time to market, to enable terminal reception of LNG into the grid.

These are the few dynamics that are happening, probably because of the war, but it remains a very fluid situation because we do not know when that will end, whether it's a short, medium, or long-term impact is still yet to be seen.

Thanks, Chris. Just as a follow-up, you said that short-term rerouting because of the Middle East yards being out of action.

On a year-on-year basis, have you seen an increase in the number of vessels calling in at your yards?

I won't say that there is an increase. There are some that we are looking at a potential of rerouting.

There are discussion around there, but we don't have that fixed outcome yet. Whether there's rerouting or whether we are selected because of the risk involved in the Middle Eastern operation, that one sometimes is not that clear-cut.

It's down to the selection of the customers.

Great. Thanks so much, Chris.

Thanks, Adrian. We have another question from Siu Kei.

Sorry, forgot to ask this question earlier. Chris, just want to actually tap your brains on how you see the rig building market.

Anything to get a little bit more excited about, or how's your view? Sometimes you told us that we still need to actually get financing, etc.

Has there been any improvement in the rig building side?

I believe that if you track the day rates of rigs, they have been improving. We are still of the view that I think that there will be a lot of discipline around the industry.

I think what will dominate the news and that will happen right now in the industry is still consolidation. The general feel with the drilling contractors would be that they're still very disciplined on their cash, having come out from a very bad industry.

They're in a much better position right now, but I think that it will still take some time before we start seeing the next rig to be built.

New build rig lah. Is there any more servicing of rig that have not touched water that comes to you given that we have so many unutilized rigs or new rigs in the market?

Do you see that happening?

The question seems to gravitate towards something, but if I interpret you correctly, the refurbishment and the upkeeping of rigs definitely is a very important segment within our R&U business. We did strike some wins in terms of refurbishment in our Brazilian yards for our regular customer for those rigs that are operating in Brazil, same as Singapore in APAC.

That probably is their focus right now. Yes, for our R&U business, we're very focused to make sure that we are competitive and we are able to service that segment.

Now if you talk about whether rigs that I'm not so sure you're mentioning there's some rigs they are coming into service and all this, that will largely depend on the business case between the owners of the rigs and the potential buyer.

I'm asking because if let's say it takes time to actually build and it's costly overall, I'm just seeing whether there's any buyers or anyone out there that would say, "Okay, let's reactivate those rigs that already been built instead of evaluating new build." That's why I'm asking.

You're talking more around the time to market type of question. From a time to market type of question, of course, logically the time to market for those rigs probably would be interesting, but it all boils down on at the end of the day, what's the buyer and seller terms, right?

Thanks.

Thanks, Siu Kei. We have a question in the chat box from Ada, but I think that question has been covered already.

I'll just give it a minute or two to see if there are more questions. If you have a question, please raise your hand, and we will get to you shortly.

I think there are no more questions. This will bring our call today to a close.

If you have more questions for us or if you need any further clarifications, please feel free to reach out to the IR team. Thank you and have a lovely day ahead.

Thank you.

Thank you. Bye.