2021
Integrated Annual Report
2021
DOF SUBSEA INTEGRATED ANNUAL REPORT
DOF Subsea's reporting 2021
Sustainability
The DOF Group has reported in the areas of sustainability to the GRI standards measuring
economic, environment, and social aspects since 2014. This, along with our participation in
Carbon Disclosure Project over the last eleven years, has driven engagement with stakeholder
groups and improved management and performance in these areas. DOF's financial position
is however not sustainable and the Group is dependent a robust long-term financial solution.
Transparency
Our vision and strategic ambitions to create broad stakeholder value are set out in this integrated
report. DOF is committed to the World Economic Forum's Pillars - People, Planet, Prosperity,
and Principles. We follow the framework to bring together the measures of stakeholder
value, aligning the non-financial reporting with financial reporting, to clearly communicate to
all stakeholders sustainability initiatives, targets and measures for the next strategic period.
Environmental, Social, and Corporate Governance
The ESG (Environmental, Social, and Corporate Governance) factbook in the final section of
this report contains extensive detail on our company wide performance in 2021 and includes
future ambitions, organised around DOF values. This document can be found in digital format
on our website: www.dof.com/sustainability.
In our report
2021 in brief
Financial highlights 6
CEO statement 8
This is DOF Subsea 10
Operational highlights 12
Shaping DOF for the future
People 16
Planet 20
Prosperity 24
Principles 28
Board of Directors
The Board of Directors 32
Report of the Board of Directors 34
Financial results
DOF Subsea Group Financial Statements 52
DOF Subsea AS Financial Statements 96
Auditor's report 121
Appendix A 131
Our ESG factbook
Introduction 126
Safe the RITE way 129
Creating value 130
Measuring our results & setting ambitions
People 132
Planet 142
Prosperity 150
Principles 156
Appendix B 164
Auditor's report 186
dof subsea integrated annual report 2021
Financial performance
Key figures DOF Subsea Group
Amounts in NOK million Management reporting Financial reporting
From the Profit or Loss
2021 2020 2021 2020
Operating income
5 545 5 337 4 303 3 984
Operating expenses
-3 458 -3 150 -2 926 -2 323
Operating profit/(loss) before depreciation and write downs - EBITDA
2 087 2 187 1 378 1 661
Depreciation
-969 -680 -665 -449
Impairment
-270 -2 591 -172 -2 471
Operating profit/(loss) - EBIT
848 -1 084 541 -1 260
Net finance costs
-462 -910 -279 -632
Unrealised currency gain/(loss)
-36 250 11 244
Net changes in gain/loss on derivatives
-150 -482 -145 -465
Net financial items
-648 -1 142 -413 -852
Profit/(loss) before taxes
201 -2 226 128 -2 112
Tax income (expenses)
-119 -11 -46 -126
Profit/(loss) for the year
82 -2 237 82 -2 238
Non-controlling interests
-10 -50 -10 -50
From the Balance sheet
Vessels and other non-current assets
13 609 14 021 10 151 10 342
Current assets
3 263 2 978 2 661 2 464
Total assets
16 873 16 999 12 812 12 806
Interest free debt
1 455 1 346 1 119 1 139
Net financing of the entity
15 418 15 653 11 693 11 667
Interest bearing debt
12 824 13 220 9 100 9 234
Equity
2 594 2 433 2 594 2 433
Key Figures
Current ratio
1) 0.30 0.28 0.27 0.25
Equity ratio
2) 0.15 0.14 0.20 0.19
Capex
3) 722 246 472 174
Operating margin
4) 38% 41% 32% 42%
Return on equity ratio
5) 3% -92% 3% -92%
Earnings per share (NOK)
6) 0.55 -13.07 0.55 -13.07
Diluted earnings per share (NOK)
7) 0.55 -13.07 0.55 -13.07
Average number of shares in the period
167 352 762 167 352 762 167 352 762 167 352 762
Number of shares incl mandatorily convertible shares
167 352 762 167 352 762 167 352 762 167 352 762
Outstanding number of shares
167 352 762 167 352 762 167 352 762 167 352 762
1) Current assets/Current liabilities
2) Equity/Total assets
3) Capex, see note 11
4) Operating result before depreciation and impairment loss/Operating income
5) Profit for the year/Booked equity
6) Majority share of profit for the year/Average number of shares. See note 10
7) Majority share of profit for the year/Potential average number of shares. See note 10
An overview of our 2021 financial performance
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dof subsea integrated annual report 2021
0
8.000
6.000
4.000
2.000
2014 2015 2017 2018 2019 2020 20212016
0%
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
NOK million
0
Operational development *)
Operating revenue
EBITDA
Operating margin
Revenue per segment *)
Long-term Chartering 29%
Subsea / IMR projects 71%
EBITDA per segment *)
Long-term Chartering 59%
Subsea / IMR projects 41%
2014
0
24.000
20.000
16.000
12.000
8.000
4.000
2015 2016 2017 2018 2019 2020 2021
NOK million
-5.000
Equity development *)
Equity
Total assets
* Based on management reporting.
7
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Delivering our
strategic priorities
From the CEO
As we publish this report, the global community is
witnessing the invasion of Ukraine. Our team, through
a fundraising drive, will provide financial support to the
Red Cross and their actions to aid the humanitarian
crisis of Ukrainian refugees. Commercially, 2022 will
undoubtedly be a year that requires strong global
governance and effective risk management efforts. We
have not identified any potential exposure to assets or
operations in Eastern Europe, specifically Ukraine and
Russia. We will draw on our own, deeply ingrained
pillars of corporate governance and ethical behaviour to
navigate the complexity of geopolitical challenges that
may unfold in the coming year.
The discussions with the lenders regarding a debt
restructuring of the Group has been ongoing through
the year and it has been challenging to operate in an
environment with short-term standstill periods. The
discussions with the creditors have been constructive, but
at the date of this report a final refinancing solution is
not yet in place which we strongly regret. The Group
is short-term dependent on extension of the standstill
periods and long-term on a comprehensive refinancing
solution to continue as going concern.
Looking back at 2021, new variants of COVID-19 and
the resulting challenges continued to prove the resolve
of our organisation and people. I am proud to say, again
that we overcome the challenges together and, although
there have been significant operational interruptions,
the organisation has shown its ability to quickly adapt
and deliver to or above the high expectations of our
clients. As always, our values and the professionalism
of our team have been the foundation for maintaining
operations safely.
We first reported environmental, social, and economic
performance, our objectives, and our results together
in the 2020 annual report, and we continued to do
so on a quarterly basis in 2021. Despite challenging
market conditions, DOF continued to meet stakeholder
expectations and strengthened our efforts and focus on
sustainability in 2021 and beyond.
Financial highlights
The Group achieved an EBITDA of NOK 2,087 million
in 2021 (management reporting) which is a satisfactory
operational result as COVID-19 continued to impact the
operations throughout the year. The largest contribution
is from the long-term chartering segment, including
the joint venture with TechnipFMC. The portion of
the operational results from the Subsea/IMR projects
segment is however increasing due to higher activity
from Q2 onwards and one vessel transferring into the
segment. The Group EBIT was NOK 848 million and
was less impacted by impairments.
Operational highlights
The markets continued to be challenging at the start
of the year, but the overall activity started to increase
towards the end of the 2nd quarter, especially in the
Atlantic and the Asia Pacific regions, resulting in good
performance from these regions the remainder of the
year. The Brazil and US regions followed up, and with
several new tenders towards the end of the year in Brazil.
In total, the Group achieved a utilisation rate of 85% in 2021.
COVID-19 has unfortunately impacted the costs and has
also resulted in o-hire for parts of the fleet, especially in
Brazil. The organisation has successfully managed to protect
the employees and kept the operations close to normal.
The PLSV fleet continued to operate on firm contracts
through the year and achieved a utilisation rate of 90%.
The Group has agreed the sale of three non-strategic
vessels in 2021. One delivered to its new owner in Q2
2021, one delivered in January 2022 and one that will be
delivered after its current contractual obligations.
The subsea fleet has slightly increased its exposure to
the renewable markets where the North Sea has been the
main market. The Hywind Tampen project in the North
Sea is the most important project and is expected to
highly impact the activity for the Atlantic region in 2022.
The Group has, through the year, secured several new
contracts with a value of NOK 4 billion, and some of
them are worth highlighting:
• Two 3-year contracts with Petrobras for the PLSVs,
Skandi Vitoria & Skandi Niteroi
• Subsea project contracts with Beach Energy and Esso
Australia in the Asia Pacific regions
• Multiple extensions of existing contracts in both the
Atlantic region and in Brazil
The total backlog by year-end was NOK 10.4 billion. Due
to high tender activity, we expect the backlog to increase
during the 1st half of 2022.
Safeguarding our People
Wherever we operate, safety is our priority, and we aim
to be an incident-free organisation.
COVID-19 lead to multiple and rapidly changing travel
restrictions, resulting in dierent patterns of personnel
deployment and some loss of the deep awareness in safety
culture across the fleet.
In the last quarter of 2021 we saw a significant increase in
injuries, however they were of minor risk level. The root causes
are connected to lack of awareness and fatigue in connect
to the Omicron variant. Our eorts to ensure we create
a safe working environment are a continuous undertaking.
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Safety means protecting and empowering our employees to
stop unsafe or inappropriate actions. In 2021, one case of
sexual harassment was reported through the DOF ethics
helpline. This case was immediately investigated and
concluded, resulting in removal. Protocols failed and we
have implemented the improvements learned from these
cases. We do not tolerate harassment of any kind in our
global organisation where diversity is a key strength in
our industry.
Sustainable Environment
Our actions to reduce greenhouse gas emissions and
manage environmental impacts are ongoing. We use a
combination of technical solutions, such as shore power
and battery packs, and an organisational approach through
environmental management systems and strategy. Our
2021 CDP score of B maintains DOF among leaders in
our industry and we strive to return to CDP’s A-list in
2022. In May, DOF was named among Europe’s Climate
Leaders 2021 by the Financial Times of London.
The Kongsberg Maritime and DOF R&D project “Intelligent
Eciency” was delivered in Q4 with promising results.
The project now moves to the implementation phase, to
be deployed on 4 or 5 vessels in Q3 2022. This predictive,
intelligent, and dynamic guidance tool will act as the
foundation for the Group to simplify operational complexity
with objective measurement, enabling optimal utilisation
and a more sustainable fleet management. Conservative
calculations estimate a reduction in CO2 emissions of
5-10%, depending on vessel type and operational pattern.
Employees
The key to DOF Subsea’s success remains unchanged – our
people. The market in which we operate has continued
to be challenging, but we have seen a headcount growth
of 24% in 2021 as we have adapted the workforce with
current market demands. At the end of 2021 there were
1,463 people in the Company.
UN Sustainable Development Goals, Human Rights
and Business
DOF’s practices are consistent with the UN Guiding
Principles on Human Rights and Business. The organi-
sation operates in compliance with fundamental labour
standards. It is gratifying that Amnesty International
has for the second year in a row acknowledged DOF
as one of the top-five global companies based in the
Nordics with the best score related to human rights
and employer responsibility.
Continuous improvement of our operations
Improvement projects have been carried out through
the Group’s value chain, focusing on standardisation
and improved eciency. We will continue this eort to
be competitive. Defining and measuring environmental
sustainability aspects and risks associated with our business
activities is important, and investment in systems and
equipment have been made to record, understand, and
improve our environmental performance, and secure a
sustainable future.
Outlook
We cautiously expect the markets to improve in 2022
as we see higher bidding activity and already have a
strong starting point with our backlog. Encouragingly in
2022, we have already seen increased activity. I strongly
believe that our global presence and our business model
strengthens our position. Our focus will be to keep our
people safe, win and execute contracts, and secure repeat
business with our clients.
Thank you for your support
I extend thanks our clients and partners for trusting
us with their operations in a year of high uncertainty.
We strive to be the preferred and responsible oshore
partner, and we will continue to do our best to meet,
and even beat expectations.
Finally, I want to express my gratitude to every employee
and contractor for their extra eort during these dicult
times. Thank you. The teamwork exhibited by the
organisation is inspiring and has helped to both make
sure that we can operate close to normal levels, and,
most importantly, keep everybody safe.
Bergen, April 6th 2022
Mons S. Aase
Chief Executive Ocer
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No matter where DOF operates in the world,
safety is held as the highest priority.
This is DOF Subsea
Company overview
Key employee takeaways *
Company overview
DOF Subsea is a leading provider of integrated
Subsea solutions to the global oshore energy
industry. Parent Company, DOF ASA was
established in Austevoll in 1981 and DOF
Subsea has continued in the proud tradition
of delivering safe and quality services to our
customers, since 2005.
DOF Subsea oers customers a single project
interface to the resources, marine assets and
multi-discipline services for seamless end-to-end
project delivery. Our global footprint, excellent
customer relations, combined with our expertise,
high-quality vessels, and strong safety culture
are central to future success in an evolving
market. Over the last decade the Company has
invested in key regions such as the Atlantic,
South America, North America, and Asia-Pacific.
Uniquely positioned in two business segments
Subsea/IMR Projects and Long-term Chartering
– the organisation can access more market
opportunities and revenue streams.
The Subsea/IMR Projects segment provides
integrates subsea services from the regions,
including planning, project management and
engineering.
The Long-term Chartering segment provides
state of the art subsea vessels and marine
management services to leading players. The
vessels in the Long-term chartering segment
have historically been on long-term contracts
to solid counterparties.
As of 31st of December 2021, DOF Subsea
has a global workforce of 1,463 people and a
fleet comprising 25 vessels, two of which are
chartered in.
A global
workforce of
1,463 people
and a fleet
comprising
25 vessels.
Age
profile
18 %
Over 50 yrs
15 %
female
85 %
male
17 %
Under 30 yrs
65 %
30-50 yrs
Gender
representation
Regional
employee
split
17 %
North America
16 %
Asia-Pacific
22 %
Atlantic
45 %
South America
* All totals as of year-end 2021
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ASIAPACIFIC REGION
BERGEN
AUSTEVOLL HQ
ABERDEEN
LUANDA
ST. JOHN’S
HOUSTON
RIO DE JANEIRO
BUENOS AIRES
ATLANTIC REGION
SOUTH AMERICA REGION
NORTH AMERICA REGION
MACAÉ
PERTH
SINGAPORE
MANILA
A trusted partner for offshore operations
Subsea Services
Integrated subsea services; wherever, whenever needed.
Project
Management
Field
Development
Field
Production
Field
Abandonment
$
Marine Services
Bringing award-winning capability to the offshore sector.
World Class
Fleet
Marine
Management
Dedicated
Crews
Applied
Technology
2
AUVs
71
ROVs
14
Offices worldwide
1,463
Skilled employees
25
Subsea
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Q1 202
GENERAL COMMENTS
Low activity in Asia-Pacific and North
America regions and increased
activity in Atlantic. Average utilisation
of the fleet 72% (76%).
MAIN CONTRACT AWARDS & EVENTS
Skandi Constructor awarded 160
days for offshore wind with
Siemens Gamesa.
CAPITAL STRUCTURE
Discussions with the lenders
continued and standstill
agreements with the secured
lenders and bondholders were
extended until 30th of April 2021.
Q2 2021
GENERAL COMMENTS
Higher activity in the Subsea/IMR
Projects segment. Average
utilisation of the fleet 83% (74%).
MAIN CONTRACT AWARDS & EVENTS
Geograph (built 2007) sold.
Awarded multiple contracts for
Skandi Acergy, Skandi Skansen and
a third-party vessel including
project management, engineering,
procurement and logistics for a key
renewable client.
General comments to the 2021
The challenging markets continued into 2021,
however during 2nd quarter the Group experienced
increased demand within the subsea project markets.
Operations have been highly impacted by COVID-19
throughout the year especially in Brazil and has
resulted in high costs and o-hire for this part
of the fleet.
Through the year, the Group secured new contracts
with a value of NOK 4 billion. The backlog by
year-end was NOK 10.4 billion.
The discussions with the lenders on a debt
restructuring of the Group has continued through
the year. By the date of this report a refinancing
solution is not in place.
Key takeaways *
Operations
Operational highlights in 2021
5.5 Billion
Total revenue
(management reporting)
85%
Average fleet utilisation
for 2021
10.4 Billion
Contract backlog
excluding options
* All totals as of year-end 2021 and all figures in NOK.
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Q2 2021 CONTINUED
Awarded multiple vessels and ROV
contracts in Brazil on seismic and
subsea projects Awards & Events.
CAPITAL STRUCTURE
Discussions with the lenders
continued and standstill agreements
with the secured lenders and
bondholders were extended until
30th of September 2021.
Q3 202
GENERAL COMMENTS
Higher activity in the Subsea/IMR
Projects segment, especially in the
Atlantic and Brazil region. Average
utilisation of the fleet 90% (83%).
MAIN CONTRACT AWARDS & EVENTS
The KDS JV AS, (a DOF Subsea and
Aker Solutions JV), awarded subsea
decommissioning contract with
DNO, including engineering,
preparation, removal & disposal
work (EPRD) of associated subsea
hardware, utilising Skandi Acergy.
Skandi Seven awarded a 6-month
contract extension in Africa,
including FSV services, project
management, engineering,
procurement and logistical services.
Asia Pacific region awarded multiple
contracts with minimum 8 months
vessel utilisation and project scopes.
PLSVs, Skandi Vitoria & Skandi
Niteroi, awarded 3-year contracts
with Petrobras
Q3 2021 CONTINUED
Skandi Achiever awarded a 1-year
contract extension with Petrobras.
Skandi Neptune agreed sold to
international buy with delivery in
2022.
CAPITAL STRUCTURE
Discussions with the lenders
continued and standstill
agreements with the secured
lenders and bondholders were
extended until 31st of October
2021. The Group prepaid a loan
facility of USD 47 million at a
significant discount
.
Q4 202
GENERAL COMMENTS
A good performance and high
activity in all regions. Average
utilisation of the fleet 90 % (78%).
MAIN CONTRACT AWARDS & EVENTS
Geosund (built 2001) was agreed
sold with delivery 2022.
Beach Energy’s Otway Offshore
Phase 5 awarded in APAC. Scope
includes Project Management,
Engineering, Fabrication,
Transportation, and Installation
Services expected to be completed
in Q1 2023 utilising Skandi Acergy.
CAPITAL STRUCTURE
Discussions with the lenders
continued and standstill agreements
with the secured lenders and
bondholders were extended until
31st of January 2022.
2022
MAIN CONTRACT AWARDS & EVENTS
DOF Subsea Atlantic region awarded
contract with a key renewable's client
utilising Skandi Acergy in the North
Sea and Skandi Constructor in Trinidad
and Tobago.
DOF Subsea Asia-Pacific region
awarded 3-year contract + 2x1-year
options with Esso Australia Pty Ltd. to
provide a Multi-Purpose Supply Vessel.
The Jones Act compliant vessel Chloe
Candies chartered in for a firm period
of one year.
DOF Subsea Australia awarded
Woodside Energy Limited's Enfield XT
Retrieval and Offshore Support Services
contract utilising Skandi Hercules.
DOF Subsea USA awarded SURF
project for Skandi Constructor from
Vaalco Energy at the Etame field,
offshore Gabon.
DOF Subsea awarded new contracts
with Renewables and Oil & Gas utilising
Skandi Acergy, Skandi Constructor,
Skandi Hera and selected third-party
vessels for 185 vessel days
The current charterer of Geosea,
owned by DOF Subsea Rederi AS, has
excercised its purchase option, with
delivery during 2nd or 3rd quarter 2022.
CAPITAL STRUCTURE
Discussions with the lenders have
continued and standstill agreements
with the secured lenders and
bondholders were extended until
30th of April 2022.
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The DOF Group’s updated vision reflects changing conditions and responds to stakeholder
expectations. We aim to be a trusted and leading partner delivering services globally for
a sustainable utilisation of offshore energy and other subsea resources. Our strategy for
sustainable value growth will be achieved via our strategic ambition in three key areas:
A debt structure, business model
and portfolio for sustainable revenue
and competitive return on capital,
makes our business attractive to
future investors and financiers, and
enables DOF to invest in assets
and competence for the future.
DOF Group provides the technical
capability, experience, and assets
globally to deliver dedicated subsea
and marine services for our clients
in an evolving subsea and offshore
energy sector.
Our 'One DOF' initiative allows us
to be an ever-flexible, fast adapting
organisation. This ensures we are
well-positioned for new and existing
markets and leading new segments
creating optimal value for our
customers and other stakeholders.
Markets Organisation
Using our values and our strategic ambition we’ve brought together our Group ‘s environmental,
social and governance (ESG) commitments across four value-based, measurable categories.
People, Planet, Prosperity, and Principles affirm our commitment to the United Nations SDGs and
give all our stakeholders a way of measuring and understanding our purpose and achievements.
Finance
Shaping DOF for the future
People Planet Prosperity Principles
Value
Drivers
People
Occupational health and safety
Environmental performance Financial performance
Marine & Subsea service delivery
Governance
Outputs
Enabling a strong health and
safety culture and systems in
values-based environment
Fostering a diverse and
inclusive workforce
Motivating engaged and
enabled colleagues
Successfully developing
technology & digital solutions
for greater operational
efficiency
Managing the environmental
and societal impacts of our
business
Providing predictable revenue
streams by securing contract
backlog
Maximising revenues through
cost control
Securing sustainable capital
structure
Providing accessible services
to support a changing market
Building strong relationships
with our clients
Risk and opportunity
management
Stakeholder Engagement/
materiality
Responsible business
Value
Created
Ensuring strong health and
safety systems and culture is
our highest priority. It’s a right
that benefits all employees,
their families, our whole
supply chain, and investors. It
is a requirement for business.
Companies are their People.
Working for a sustainable
company, offering fair work,
with career prospects creates
an engaged workforce which
benefits customers, investors,
and suppliers. Training and
careers programs benefit local
communities creating career
paths and long-term benefits.
We care about the
environment in which we live.
Improved performance
benefits all stakeholders.
There are also efficiency
and innovation gains to be
realised by responding to
these critical issues.
Sustainable returns make
DOF’s business attractive to
future investors enabling DOF
to invest in people and
relevant assets for the future.
Generating wealth and
opportunity by engaging local
businesses and suppliers and
ensuring integrity along the
supply chain by auditing for
human rights.
Subsea and Marine services are
the core value generating work
of our business. Building strong
relationships and ensuring we
have the right assets and
capability to support our
customers in the evolving subsea
and offshore energy sector is
key to our future and therefore
benefits all stakeholders.
Upholding good governance
and standards ensures decent
work, generates wealth for
employees, local communities,
and along our supply chain,
as well as wider society by
generating taxes.
To produce lasting value
for stakeholders, and a
long-term competitive return
on the investment the BOD
and Corporate Management
employ ERM to evaluate risk
and opportunity and
potential to realise vision
and strategic direction.
Enabling integrity along the
supply chain with supplier
social screening.
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PeoplePeople
A SAFE, INCLUSIVE,
INSPIRING WORKPLACE:
Diversity, equality, & inclusion .. 17
Skills for the future .................... 18
Human rights ..............................18
Employee health & wellbeing ....19
ProsperityProsperity
GOOD CORPORATE CITIZENS,
EFFICIENT OPERATIONS,
POSITIVE IMPACTS
Innovation & technology ............25
Wealth generation ......................25
Circular economy ........................ 26
New market segments ............... 26
PlanetPlanet
TRANSPARENCY,
ENVIRONMENTAL STEWARDSHIP, &
SUSTAINABLE SOLUTIONS TO
REDUCE OUR IMPACT
CDP & GRI reporting ................... 21
UN SDGs ....................................... 21
Emission & energy reduction ...... 22
Green Shipping ............................. 22
Environmental stewardship ......... 23
DOF is a values-driven company operating in the offshore
energy sector, where energy production is transitioning to
cleaner solutions and renewables. To be a sustainable,
investible company our business platform must reflect
stakeholders’ expectations, future market demand for
the skills and potential of our people and our assets.
GROUP
Environmental, Social, and Governance commitments
THE
PrinciplesPrinciples
SAFE, LEGAL, ETHICAL
DECISIONMAKING,
EVERYWHERE WE DO BUSINESS
Governing purpose ....................... 29
Our Board ...................................... 29
Accountability & transparency .... 29
Ethical behaviour .......................... 30
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Our People
A SAFE, INCLUSIVE,
INSPIRING WORKPLACE
People
Companies are their People. Working
for a sustainable company, offering
fair work, with career prospects
creates an engaged, skilled
workforce which, in turn, benefits
customers, investors, and suppliers.
Ensuring integrity along the supply
chain by auditing for human rights
enables wealth generation and
creates opportunity by engaging
local business and suppliers.
The key to our success has always been our people. The challenges ahead are different
in nature; however, the importance of our people-factor never changes.
Technology, connectivity, and remote working revolutionised the way we work. These
newly established routines facilitate collaboration, flexibility, and efficiency across
the organisation. Promoting a culture of diversity, equality, and continuous develop-
ment, in a safe, inclusive workplace is central to employee health and wellbeing,
which benefits all stakeholders.
“It is of great importance that we
inspire women to lead in DOF”
- Marianne Møgster
0
GDPR breaches
recorded in 2021
1
Confirmed
harassment cases
recorded in 2021
0.79
%
Absence
absence due to sickness in 2021
1,463
Headcount
headcount per 31.12.2021
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dof subsea integrated annual report 2021
Captain Débora Paula Ferreira
Improving diversity, equality, and inclusion
in line with UN SDG 5, Gender Equality
Our commitment: DOF will increase the number of female leaders. The global goal is to reach
25% female representation in the seasoned professionals and management group by 2025.
The connection between gender diversity and corporate performance is well documented. A more
diverse corporate culture can lead to more innovation, creativity, and critical thinking, as well as higher
productivity. We use recognised programmes and pathways to deliver this goal.
FiftyFifty programme:
Seven managers have been
enrolled in the international initiative to learn
and share best practices for women leaders. We
plan to expand with similar leadership training
in our regions in 2022.
Career pathways for female offshore leaders:
DOF is proud of a strong track record creating
career pathways and promoting diversity and
gender equality in our oshore leadership. Today
we have six female engineers, and 50 female
ocers including three female captains.
You can’t be what you can’t see: Celebrating
International Women's Day 2021. DOF’s master
class 'Women's leadership and how to develop it'
webinar for women employees in the Brazil region
was attended by 61 onshore and oshore women.
Captain Erica Mesquita
Captain Tereza Santos
16 ambassadors from company-wide disciplines and locations participated in the 2021 professional development programme.
Find more info at:
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Read more at:
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17
dof subsea integrated annual report 2021
section header - no caps
Skills for the future: a culture of continuous learning
in line with UN SDG 4, Quality Education
Our strategy: To align the people in DOF ASA and the Group, maintaining the diversified strengths
and our unique position with both marine and offshore subsea services, our global footprint and
established local networks.
The Group’s commitment to professional development and a leadership development agenda are integral to
achieving our strategic ambition and shaping DOF for the future. In a positive move forward, programmes
postponed in 2020 due to COVID-19 pandemic were staged in 2021 with more planned for 2022.
Where
we were unable to travel freely, we engaged participants and delivered programmes virtually.
DOF Ambassadors Programme:
16 ambassadors
from company-wide disciplines and locations
participated in this professional development
programme for our next generation leaders.
The DOF Workbook leadership training 2022:
Global onshore and oshore leaders will participate
in leadership training to support leaders in their
role, and maintain high standards of excellence.
Officer’s Conference: Leaders from the vessels
gathered at the annual ocer’s conference over
two days to share key organisational initiatives
and learnings from the pandemic.
CEO’s global virtual Town hall meetings:
Using Microsoft Teams, meetings were split into
two sessions, hosted twice on the same day, to
cover all regions and as many people as possible.
Annual Leaders Seminar Brazil: 450 onshore
and oshore employees participated in this virtual
event, to interpret and discuss the three pillars of
the Shaping DOF for the future strategy.
DOF respects human rights
and believes them central to all UN SDGs
Our commitment: We avoid causing or contributing to adverse human rights impacts through our
activities and we seek to prevent adverse human rights that are directly linked to activities through
our business relationships.
Amnesty International again ranked DOF in the top-five global companies based in the Nordics with the
best score related to human rights and responsible employment practices. Our approach is well established.
Policies and standards: International Law
and Labour Organisation conventions ensure our
operations do not breach international standards,
conventions, and UN guidelines.
Ethical business along our supply-chain:
Vendor evaluation is mandatory for all suppliers. It
is designed to ensure UN Global Compact principles
for Human Rights, Labour, Environment and Anti-
Corruption are upheld along our supply chain.
The Code of Business Conduct: supports our
organisation and partners to comply with UN’s
Guiding Principles on Human Rights and Business.
Freedom from slavery: DOF operates in
compliance with all applicable laws prohibiting
modern slavery or any use of forced or child labour
in our operations or supply chains.
Employees’
rights:
DOF recognises and respects
employees rights to freely associate, organise
and collectively bargain, and complies with
requirements in local laws.
Ethics helpline: a strong ‘feedback loop’ is
essential. DOF introduced the ‘ethics helpline’ in
2018 giving stakeholders a 24/7 accessible tool to
report serious concerns with anonymity.
Top-5
scoring in the Nordics
Amnesty International’s
acknowledgment in June
2020 placed DOF in the
top-5 global companies based
in the Nordics with the best
score related to human rights
and responsible employers.
Find more information at:
https://amnesty.no/
Find more info at:
www.dof.com/code
Read more at:
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18
dof subsea integrated annual report 2021
Operational health & safety
Ensuring strong
health and safety
systems and culture
is our highest
priority. It is a
human right that
benefits all
employees, their
families, our whole
supply chain, and
investors. It is also
a core requirement
for business.
Employee health & wellbeing
in line with UN SDG 3, Good Health and Wellbeing
Our commitment: DOF strives to be the leader in the fields of health, safety, environment, and quality (HSEQ) and
systematically promotes these areas in the execution of all activities and operations.
Health and safety in a global pandemic we face similar operating conditions in 2022. Our proven ability to adapt and
maintain operations safely is core to our value creation for all stakeholders and future high-standard service delivery.
Safe the RITE way: Structured systems and a strong
safety culture underpinned our response to the COVID-19
pandemic. Strict protocols to protect our employees and
their local communities are still deployed to maintain
safe operations.
A Global Employee Assistance Programme (EAP):
Mental health and wellbeing concerns within our industry
increased during the pandemic. DOF will launch a uniform
EAP assistance solution to support all employees in 2022.
Flexible work:
Employees are in favour of a hybrid workplace.
The global Working from Home survey gave us crucial insights
into important aspects of employees work and personal lives.
Employees reported improved work-life-balance, reclaimed
time, greater flexibility, with improved physical and mental
health levels, and feelings of overall wellbeing.
The DOF Workbook 2
nd
edition: Updated with the Group’s
rolling strategy, new vision, and enterprise risk management,
this is a core training resource for all employees.
1
Lost time injuries
Lost Time Injuries (LTIs)
in 2021
7
Incidents
recordable incidents
in 2021
0.27
/million hrs
Lost Time Incident frequency
13,211
Safety observations
raised in 2021
1.9
/million hrs
recordable incident frequency
2,226
Obervations
positive safety observations
reported by workforce
19
We care about the environment in
which we live and work. Improved
performance in this area benefits all
stakeholders. There are also
innovation, efficiency gains and new
opportunities to be realised by
responding to these critical issues.
Our Planet
TRANSPARENCY,
ENVIRONMENTAL STEWARDSHIP,
& SUSTAINABLE SOLUTIONS TO REDUCE OUR IMPACT
Climate action is important to all our stakeholders and has far wider implications
as a shared responsibility in the world. As a company harnessing our values, it is
fundamental that we act to protect the environment. It is also integral to our
strategy as DOF's customers transition energy production to cleaner solutions
and increase renewables in the energy mix.
-6.6%
CO
emissions
parent company total emissions
in 2021 compared to 2020
B
CDP score
for 2021
0
Unrecovered
no spills unrecovered over 50 litres
Environmental performance
20
Meeting our stakeholders’ expectations
in line with UN SDG 13, Climate Action
Our strategy: Maintain our position within top five for ESG sustainability in our industry.
DOF is a leader in Environmental, Social, and Governance (ESG) reporting. Transparent, industry
comparable reporting is an important tool in driving change. The Governance Group (TGG) conducted
an independent review of DOF’s sustainability reporting activity in 2020. DOF received a stand-out
score of 3.09 (A-) within the Industrial Transport Sector group using the ESG 100 method, scoring
maximum points in both GRI reporting and UN SDG integration and above the sector average of 2.33.
The Group has established programmes to reduce its climate impact, including the major R&D project
Intelligent Eciency, Ship Energy Eciency Plans (SEEMP), installation of shore power capability, and
of battery packs on vessels. The performance of these programmes, and other ESG metrics, are publicly
reported in a structured way so they are transparent, measurable, and understandable to stakeholders.
Carbon Disclosure Project (CDP) for transparent
environmental reporting: DOF has reported to
the CDP framework since 2010 and recorded B in
2021. CDP constantly evolves the disclosure and
scoring system in response to market needs and
the rising urgency of the environmental challenges.
Today, CDP’s climate change questionnaire contains
over 25 TCFD-aligned questions in the Governance,
Risks and Opportunities, Strategy, Targets and
Emissions modules of CDP’s questionnaire and
include specific methodologies for high impact sectors.
Global Reporting Initiate standards (GRI):
DOF has reported to GRI since 2014 ensuring vital
drivers of sustainable operations are factored into
decision making and to provide stakeholders with
a view of all aspects of organisational performance.
UN Sustainable Development Goals (SDGs):
Working principally with oshore vessels and subsea
engineering, the Group aligns with the SGDs where
we have the greatest impact and can make an
important contribution as part of our operations.
2021 B
11-year participation
Top 30% for
Environmental Stewardship
Find more information at:
https://www.cdp.net
Sustainable Development
17 GOALS
DOF strives to positively
impact the world by aligning
with relevant UN
Sustainable
Development Goals (SDGs)
Since
2014
using Global Reporting
Initiative (GRI) Standards:
Recognised industry
leader
Independent assurance
report Sustainability
& Greenhouse Gasses
(GHG) verification
A-
ESG 100 score
DOF named in Financial Times
Europe's Climate Leaders 2021
21
Emissions and energy reduction
The IMO's goal is to cut GHG emissions by 50% by 2050, while pursing eorts towards phasing
it out. DOF is on target to meet the IMO goal but is committed to, compared to 2008 levels,
a 40% reduction in CO
2
emissions by 2030. We are adapting to a zero-emission mindset, and
work in collaboration with vendors to achieve a responsible supply chain.
Continuous reduction in fleet-wide energy
use and GHG emissions is a significant
focus for the Group. Innovation, technology,
and digitalisation are the drivers for resilience
in DOF’s product range. Find detail of specific
actions in Prosperity.
Developing Science-Based Targets:
Establishing Science Based Targets (SBTs) for
GHG emissions reduction provides a clear
pathway to becoming a net-zero company. In
2022, we plan to work with the TERRAVERA
Foundation to build a model that is suitable for
scope 1, 2, and 3 emissions and set SBTs. In
addition, DOF has formed a strategic alliance
with Kongsberg Maritime Group to align eorts
in reaching SBTs on an executive level, for
scope 1, 2, and 3 emissions.
Circular Economy Approach: Inspired by the
MacArthur Foundation’s Circular Framework,
understanding, and optimising the data behind
DOF’s assets over its life-cycle is the most
eective method of achieving a circular economy.
Each phase of the life-cycle, newbuild; expected
operational life; extended life of asset; presents
unique opportunities to apply circular economy
principles. More detail is given in Prosperity.
‘Green Shipping Programme’: As a member
of the Norwegian partnership led by DNV,
and including a wide range of maritime
sector companies, DOF, VARD, DNV, and
other stakeholders studied the opportunities
in converting oshore vessels to new markets,
such as Oshore Wind. The study concluded the
case for conversion presented economically and
environmental benefits compared to newbuild
alternatives. Basing calculations for the newbuild
on current technologies, the conversion study
found emissions were reduced by 30%, and a
conversion including a retrofit/battery package
reduced emissions by 15%. Adding emissions
from the production of the newbuild, total
emissions for the converted vessel would be
lower than the newbuild for around 10 years.
Activities and programs to reduce climate impact
Reduced flare in upper part of the bow for cutting through
large waves and minimising added resistance
Optimised intermediate bow section crushing small waves.
Flared notch above bulb to suppress small/ medium waves.
Optimised under water lines including bulb for calm water.
Bulb designed to reduce running resistance of the vessel,
and to resist pitching in waves.
Improved fuel efficiency through design
Vessel bow shape is optimised for eco-drive in all weather
conditions and designed to minimise free-running fuel
consumption in three sea state regimes.
Design Power innovations
Shore power connection
Route optimisaton
DOF has the expertise in-house to
chart routes in order to minimise fuel
consumption and reduce ship motions
for passenger comfort.
Model tests are undertaken to optimise
longitudinal trim monitoring for minimum
resistance and an ongoing program
of correlation of vessel performance
against met/ocean conditions are part
of our fuel efficiency initiative.
LNG
L
NG bunkering is already a recommended practice in 15 countries
worldwide, vessels like the Skandi Gamma dual powered LNG MPSV
provide major environmental, HSE and commercial advantages.
Project Savings Reduced consumption with LNG ~ 30%. with no
reduction in cargo capacity.
Environment
Optimised hull lines. LNG driven – low emissions. Reduced emissions
NOx ~ 85%. Reduced CO2 emissions ~ 25-30%
HSE Crew comfort. Reduced Noise levels due to configuration.
Battery storage
Energy storage through batteries leads to reduction
of carbon footprint and reduced maintenance cost.
Shore power connection delivers cost and
emission savings. DOF made history with
Skandi Vega, the first vessel to connect to
the harbour facility via shore power.
Carbon Disclosure Plan The Shore
Connection plant allowed Skandi Vega to
achieve an Environmental Ship Index score
of over 50 i.e., estimated reduced energy
cost (Diesel vs. Shore power supply) and a
significant saving of CO2 p/a
Hull resistance
22
dof subsea integrated annual report 2021
DOF employee, Holley, whale shark
Environmental stewardship
in line with UN SDG 14 Life Below Water
Our commitment: We avoid causing or contributing to adverse environmental impacts through
our activities and along our supply chain.
Maintaining best practice management, DOF is undertaking a review of governing documents
connected to biodiversity and marine pollution guided by IMCA recommended code of practice on
environmental sustainability. Programmes for continuous improvement are focused in risk evaluation
and a reduction in the parameters for investigation and reporting biofouling or spills.
An education programme is planned in 2022
to increase understanding in the area of biofouling,
marine plastics, and hydrocarbon management.
Waste Management: a plan has been
implemented for DOF to phase out single-use
plastics generated by our employees through our
operations by 2022.
As a component of Circular Economy
development,
waste management will become
an audit criterion in Global HSEQ Audits.
Environmental Stewardship: Caring for environ-
ment in which we live and work, DOF will partner
with an NGO to contribute beyond our operational
footprint to support industry experts.
Biodiversity and Marine Pollution: DOF has
strict procedures and routines to manage impacts
associated with the introduction of invasive marine
species through vessel operations and unplanned
discharge of hazardous materials through loss of
secondary containment and publicly reports our
performance in this area.
23
Our Prosperity
GOOD CORPORATE CITIZENS,
EFFICIENT OPERATIONS,
POSITIVE IMPACTS
We are successfully developing
technology and digital solutions for
greater operational efficiency and
managing the environmental and
societal impacts of our business.
Decent employment, training, and
career programmes benefit local
communities creating prosperity
and wider long-term benefits.
We operate in an evolving market. New and different demands from our stakeholders
and the changes in the energy market are key drivers for our future organisation.
DOF has over 40 years’ operational experience in complex markets and a history
of adapting to deliver competitive services, globally. We have an ambitious
programme to develop new technology and digital solutions for energy
management, GHG emissions reduction, efficiency, and to grow new market
segments.
85
%
Utilisation
of the fleet in 2021
80
%
Utilisation
of Subsea project fleet in 2021
10.4
BILLION
group backlog per 31.12.2021
Financial performance
24
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Stakeholder and wider wealth generation
in line with UN SDG 8, Decent Work & Economic Growth
Our Strategy: To build a debt structure, business model, and portfolio that provides for sustainable
revenue and competitive return on capital, making DOF’s business attractive to future investors and
financiers, and enabling DOF to invest in competence and assets for the future.
The Group continues to implement new technology to create sustainable value and respond to
the ongoing shift within the energy markets. Additionally, DOF creates wider stakeholder value
and prosperity for individuals, their families, governments, and society by creating jobs, assisting in
enterprise development, and technology transfer to local communities. In addition to Decent Work,
our wider societal benefits are based on training, career pathways for local communities, engaging
local businesses, and supporting early-life education, cultural and sporting programs.
The immediate and short-term focus on debt
structure: co-exists with our focus on building
a robust and sustainable business model for the
longer term. We continued optimising organisational
structure to support a highly agile organisation, this
will be realised in three stages: focusing on review
and reporting structures; using technology and
centralisation for eciency gains; and by focusing
on competency, succession planning, and work
culture to ensure a competitive level of access to
market opportunities. Aligning people in DOF ASA
and DOF Subsea also continues, always maintaining
the diversified strengths and our unique position
with both marine and oshore subsea services,
global footprint, and strong local networks. These
are key to shaping DOF for the future.
Decent Work: DOF employs 3,280 and in 2021
created 694 full-time equivalent positions.
Training and career pathways in our local
communities:
We train and maintain a dedicated
core crew on all our vessels. This creates value
by retaining operational and vessel knowledge
between charter or project crew changes, and leads
to a higher level of safety, eciency, and quality
of services, benefiting all stakeholders.
Global maritime cadetship programme: This
long running program gives cadets a structured
path to gain qualifications in maritime careers
and a long-term livelihood. Seafarers are trained
through the Norwegian Training Centre – Manila,
Philippines (NTC) and the AEPM in Brazil, to the
highest standard of safety and quality and promote
excellence in maritime operations worldwide.
Developing highly qualified officers to operate
our fleet, training and qualifications support career
progression from the cadet programme onwards.
Courses oered completely cover vessel operations.
Promoting education, culture, and sports:
DOF
supports specialist organisations’ structured
programmes, primarily in Brazil and Philippines,
to give underprivileged children a chance for a
better future. DOF Sponsors the Renascer foster
institute (Brazil): An organisation which cares for
children from one to five years old, presenting
them new life perspectives through sports, art,
and music, providing them with a home, food, and
shelter. The community of Comatin (Phillipines):
DOF and our partner in the Philippines, OSM,
rebuilt the elementary school after a typhoon in
2013 and have maintained support since.
25
Investor surveys
suggest that
a structured,
methodical
evaluation of
non-financial
disclosures is
the new norm
in investment
decision making.
Innovating technologies & core services
in line with UN SDG 9, Industry, Innovation and Infrastructure
Our Strategy: To provide the technical capability, experience, and assets globally to deliver dedicated subsea and marine
services for our clients in an evolving subsea and offshore energy sector.
Our strategic ambition is anchored in the diversified strengths and expertise from marine and subsea organisation, matching
existing assets and the unique skills, and potential of our people to future market demand. Cross company, multi-disciplinary,
technical steering committees manage major projects to progress our strategic priorities in innovation, technology, digitalisation,
and new market segments.
Emissions reduction and energy management
Yxney´s Maress cloud-based software was
deployed on the whole fleet in Q1 2021. Maress
analytics allow decision makers onshore and on
the bridge to make more informed decisions on
how to reduce emissions. In addition to the direct
emissions savings, the system also underpins the
portfolio of DOF´s other GHG-reducing initiatives.
Intelligent Efficiency: The research project
partnership with Kongsberg Maritime, SINTEF
Ocean and NORCE, the product has been under
development concept, define and create phases
since 2018. The next exciting phase plans to extend
the solution to three or four vessels, pending final
project evidence of energy and emissions savings.
Circular Economy (CE) approach: A new policy
will be adopted in 2022, supported by a 3-year
programme applying The MacArthur Foundation’s
Circular Framework across our Value Chain. A
Life Cycle Management model will maximise
the use-cycles of assets and reduce consumption
and GHG emissions. The most eective method
of implementing CE solutions is understanding
and optimising the data behind DOF’s vessels
over a 3-phase life-cycle. Each phase presents
unique CE opportunities. With no newbuilds
underway, our focus is expected operational life
and extended life of assets through maintenance
protocols, reducing material inputs, and system
enhancements. Modernisation opportunities are
expected to extend life of assets before recycling.
New zero or low-emission fuels: feasibility
studies investigating alternatives to traditional
fuels and battery combinations are underway.
Other efficiencies and emissions reduction:
Delivered by increasing shore power capability
and installation of large batteries onboard vessels.
Core services
Remote operations uses technology to allow
oshore personnel to perform their duties without
being physically present on board a vessel. “Survey
in The Cloud – Remote Operations” developed over
2020/2021 will be implemented on four vessels
in 2022. Progress testing is underway for Remote
Digital Class services with some surveys undertaken
onshore with support from crew.
Subsea robotics: A project investigating future
ROV operations and subsea vehicles with robotic
features, such as the classic work class ROV, AUV,
and newer types of subsea vehicles designed for
data acquisition and intervention.
Business continuity is critical
. Increased focus
on cyber security to avoid operational disruption,
financial risks, and reduce threats to business
continuity and sustainability is ongoing.
Circular Economy (CE) approach
26
dof subsea integrated annual report 2021
Marine and Subsea service delivery
Subsea and Marine services are the core
value-generating work of our business.
Building strong relationships and ensuring
we have the right assets and capability to
support our customers in the evolving subsea
and offshore energy sector, is key to our
future and therefore benefits all stakeholders.
The Floating Offshore Wind segment
creates jobs, revitalises ports, and
domestic manufacturing supply chains.
Renewables: new market segments
Floating Offshore Wind (FOW): Considered
the future of oshore wind farm development
as the proven technology opens vast areas
of the ocean to clean energy production.
FOW developments are not limited by
water depth, can be placed in stronger,
more consistent winds and advances in
turbine design mean more eective and
cost ecient energy production.
DOF is growing in this clean energy segment,
our operational experience, competence, and
assets are ideal for FOW field development.
DOF Subsea and JV partner are currently
engaged in delivering the world’s largest
floating oshore wind farm, Hywind Tampen,
in Norway. This project is expected to
reduce the CO
2
footprint in future projects.
4.2
Subsea client
satisfaction
in 2021
(out of max score of 5)
4.2
Marine client
satisfaction
in 2021
(out of max score of 5)
98.7
%
Vessel uptime
available operative time in 2021
99.3
%
ROV uptime
available operative time in 2021
27
dof subsea integrated annual report 2021
We have the pillars in place to uphold a culture of legal and regulatory
compliance: the foundation for honest, ethical business. We believe strong
institutions operate to universal principles and give stakeholders the
resources to uphold standards.
Our Principles
SAFE, LEGAL,
ETHICAL DECISIONMAKING,
EVERYWHERE WE DO BUSINESS
Upholding good governance and standards
ensures decent work, generates wealth for
employees, local communities, and along our
supply chain, as well as for the wider society
by generating taxes.
The Board and Corporate Management team
evaluate risk and opportunity and potential to
realise our vision and strategic direction for a
long-term competitive return-on-investment
and to produce lasting value for stakeholders.
We ensure integrity along the supply chain
with supplier social screening.
Principles
0
Fines
or non-monetary sanctions
due to non-compliance
36
Audits & Inspections
completed in 2021
172
NCRs
raised in 2021
0
Corruption
cases in 2021
28
dof subsea integrated annual report 2021
section header - no caps
Governance
in line with UN SDG 16, Peace, Justice and Strong Institutions
Our commitment: Strong governance is a core tenet for our business. Our corporate governance
policy outlines the measures which are continuously implemented to secure ecient management
and control of the activities of the Company.
Governance principles:
Good corporate governance
and trustworthiness are a prerequisite for value
creation, and for access to capital. Strong and
sustainable corporate governance is the foundation
of the Group's integrity and assurance through
healthy business practices, reliable financial
reporting, and an environment of compliance
with legislation and regulations across the Group.
For further information please visit DOF ASA’s
website www.dof.com.
Our Board:
Meet the Board Directors responsible
for all governance, strategy, and sustainable
development within the DOF Group on page 32.
Double materiality stakeholder engagement:
Stakeholder engagement is a continuous and on-
going process as we factor stakeholder expectations
and broader challenges into strategy and decision
making. DOF established a materiality process in
2015. Increasing the focus on risk and opportunity,
the Group evolved to a more contemporary double-
materiality approach in 2021. See page 176.
Integrating risk and opportunity into business
process:
The Group’s risk management and internal
controls are based on the principles in the Norwegian
Code of Practise for Corporate Governance. The
Board and Corporate Management Team evaluate
risk and opportunity and potential to realise vision
and strategic direction for long-term competitive
return on the investment and to produce lasting
value for stakeholders. See page 178.
New regulatory requirements in ESG reporting:
The Norwegian Transparency Act requires DOF
to work systematically with human rights in the
value chain, and report accordingly. The new EU
Taxonomy classification system establishes a list
of environmentally sustainable economic activities.
Companies will need to report the proportion
of their revenue, capex and opex classified as
eligible according to this Taxonomy.
The ERM process
(continued)
Risk associated with DOF’s
strategic direction; framing
strategy; framing value
creation; 3-yr improvement
program.
Strategic Risk
Regional and Business
Unit Management Teams
Perform audits against global
frameworks; communicate
concerns raised by audit
committees or stakeholders
relevant to business unit
actions.
Review material issues,
including: problematic
cultural and operational
risk and opportunities with
specific focus on delays,
cost overruns, commercial
disputes, margins, and other
concerns.
Cascading lessons learned
across DOF regions and
business units.
Oversee activities of the
external and internal audit
functions, receive input on
the adequacy of financial
reporting and control
mechanisms on material
risk issues that could
impact company integrity.
Risks associated with
operations, planning and
executing marine and
subsea activities.
Operational Risk
Risks associated with
corporate culture; adapting
global business model to
regional business environ-
ment and customs; local
legal issues; regional
management.
Business Risk
Board of Directors /
Corporate Management
BOD and Corporate levels
of the management:
To produce lasting value
for stakeholders, and a
long-term competitive
return on the investment
the BOD and Corporate
Management regularly
evaluate long-term risk and
opportunity and potential
impact on strategic decisions
taken today.
The Corporate Management team as the governing body for assurance of the ERM model
by overseeing activities and efficacy ERM Framework – reporting to the BOD
Engaging key stakeholders; evaluating value creation; setting risk appetite; consider high-level
organisational risk from other areas of the business; strategic risk management and governance
mechanisms to respond to mega-trends and long-term macro level shifts in the external
market; cascading governance principles into cultural and process risk management areas.
Execution Teams
Annual Leaders Seminar
Find more info at:
www.dof.com/
CorporateGovernance
Integrating risk and opportunity into business process
29
dof subsea integrated annual report 2021
section header - no caps
Ethical behaviour
DOF has measures in place to assist with ethical behaviour
throughout the Group.
Our Code of Business Conduct (COBC) is aligned to the
UN Global Compact and is our blueprint for conducting
business fairly and responsibly. It was relaunched in 2018
and structured around our five values: Respect, Integrity,
Teamwork, Excellence, and above all we are SAFE. The
COBC is supported by extensive awareness training for
complex issues like Anti-Bribery and Corruption.
Anti-corruption: DOF requires employees to train annually
in key ESG topics like anti-corruption, SCM, environment,
and Human Rights. During 2022, DOF will make IMCA’s
anti-corruption e-learn available for the organisation, and
it will be mandatory for selected employees in the Group.
The DOF Watertight Integrity Test:
DOF’s Code of Business
Conduct aims to help everyone understand and meet the
Group’s expectations for professional standards and how to
comply with all legal and regulatory obligations, worldwide.
The “DOF Watertight Integrity Test” is a simple tool to
support decision making in any situation. Read more in our
Code of Business Conduct: www.dof.com/TheCode.
Ethics helpline: A strong ‘feedback loop’ is essential. The
Group introduced the ‘DOF ethics helpline’ in 2018 to give
stakeholders anonymity and a 24/7 accessible tool to report
serious concerns.
Fully audited ISO certification for a business platform in
line with future market demand. In Q4 2021, DOF received
renewed ISO certificates (ISO 9001:2015, ISO 14001:2015,
and ISO 45001:2018). This was a milestone for the Group
aligning systems, while supporting strategic development.
30
section header - no caps
Code of Business Conduct
Aligned to the UN's Global Compact
Find more information at:
www.dof.com/code
Find more information at:
www.dof.com/safe
31
dof subsea integrated annual report 2021
Board of Directors
of DOF ASA
Born in 1962. Hans Olav Lindal was appointed to
the Board in 2019. He is a Norwegian qualified
corporate lawyer, admitted to the Supreme Court of
Norway and partner of the law firm Advokatfirmaet
Thommessen AS since 1993. He was President of the
Norwegian Shipowners' Association and board member
of International Chamber of Shipping (ICS) until 2018,
and chairs and serves on the board of directors of
several companies in the maritime industry, including
Viken Shipping, Wallem, Gearbulk and G2Ocean. Mr.
Lindal is a Norwegian citizen and resides in Norway.
Hans Olav
Lindal
Chairman
Born in 1963. Helge Singelstad was appointed to the
Board in 2008. He has extensive experience from various
types of business such as oil and gas, ship equipment
and the seafood sector. Mr. Singelstad chairs and serves
on numerous boards of directors, including being the
chairman of the Board of Directors in Austevoll Seafood
ASA, Lerøy Seafood Group ASA, and Pelagia Holding AS,
and is CEO in Laco AS. He holds a degree in computer
engineering from Bergen Engineering College, a degree
in Business Administration from the Norwegian School
of Economics and Administration (NHH), and he has a
first year degree from the law school at the University
of Bergen (UiB). Mr. Singelstad is a Norwegian citizen
and resides in Norway.
Helge
Singelstad
Director
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Born in 1964. Kathryn Moore Baker was appointed to the
Board in 2016. She is chairwoman of Genetic Analysis AS,
Pensionera AB and Terra Mater Renewable Investments
AB. Ms. Baker is also a board member of Akastor ASA,
MPC Energy Solutions NV, Gaming Innovation Group
PLC and Labrida AS. Ms. Baker was previously a
member of the Executive Board of the Central Bank of
Norway, a partner at the Norwegian private equity firm
Reiten& Co and has held positions with Morgan Stanley
and McKinsey & Co. She holds a bachelor’s degree in
economics from Wellesley College and an MBA from the
Tuck school of Business at Dartmouth. Ms. Baker is a
United States citizen and resides in Norway.
Kathryn
Moore
Baker
Director
Marianne
Møgster
Director
Born in 1974. Marianne Møgster was appointed to the
Board in 2016. She currently serves as Senior Vice
President of Finance in DOF Subsea AS, and has expe-
rience from several other positions in DOF, Equinor,
and Norsk Hydro. Ms. Møgster has experience as a
board member both with the DOF Group and other
listed companies such as Lerøy Seafood Group ASA and
holds the position as a board member in the Norwegian
Hull Club (NHC), Belships ASA and The Norwegian
Shipowners’ Association. She holds a degree in Economics
and Business Administration from the Norwegian School
of Economics and Administration (NHH). Ms. Møgster
is a Norwegian citizen and resides in Norway.
Born in 1979. Harald Thorstein was appointed as Director
of the Board in 2020. He holds a MSc in Industrial
Economics and Technology Management from Norwegian
University of Science and Technology (NTNU), with
specialisation in Finance and Optimalisation. He is
the founder and owner of the London based advisory
company Arkwright London Ltd. and has previously held
positions in Seatankers Management and DNB Markets.
Mr. Thorstein is currently Chairman of the Board of
B2 Holding ASA, Chairman of Altus Intervention and
Director of Odell Drilling. Previous board experience
includes Aktiv Kapital, Axactor, SFL Corp, Seadrill,
Frontline 2012, Golden Ocean, Deep Sea Supply and
Solstad Oshore.
Born in 1966. Mons Svendal Aase has been a part of the
Management team since 1998. He served as CFO and
Deputy Managing Director before he became CEO of the
Company in 2005, and in 2009, he also became CEO of
DOF Subsea AS. Mr. Aase has various experience from
finance and shipbroking industries and chairs, as well
as serves, on numerous boards of directors. He holds a
MSc from the Norwegian Institute of Technology and a
Cand. Merc. from the Norwegian School of Economics
and Business Administration (NHH). Mr. Aase is a
Norwegian citizen and resides in Norway.
Harald
Thorstein
Director
Mons
Svendal
Aase
CEO
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Report of the Board of Directors
Key notes
In summary 2021 has continued to be a challenging year with respect to COVID-19, but
the O&G markets have improved in addition to an increased demand for vessels within the
renewable market. The DOF Subsea Group (“the Group”) achieved an average utilisation of
its fleet of 85% through the year, and higher rate levels compared to the previous year. It
is however too early to conclude on a market recovery within O&G, and how the current
geopolitical instability might impact the markets is uncertain. During the year the Group has
succeeded in maintaining its strong position within environmental and social sustainability.
The Group has since 2nd quarter 2020 entered into rolling short-term standstill agreements
(including deferral of interest payments and instalments) with the majority of its secured
and unsecured lenders. The discussions with the creditors have continued in 2021, and the
Company regrets that a refinancing solution is not yet in place. The Group is dependent
on continued standstill agreements with its creditors until a long-term and sustainable
financial solution is agreed to maintain as going concern.
The Group`s revenue (management reporting) was NOK 5,545 million (NOK 5,337 million) and
the EBITDA was NOK 2,087 million (NOK 2,187 million). The EBIT was NOK 848 million
(NOK -1,084 million) whereof the EBIT in 2020 was impacted by high impairments. The
net result was NOK 82 million (NOK -2,237 million). Of which the negative financial result
in 2020 was highly impacted by unrealized currency loss due a strengthened USD towards
NOK. The Group’s operational cash flow was NOK 1,565 million (NOK 1,705 million) and net
cash flow after finance and investment activities was NOK -161 million (NOK 961 million).
Business Overview & Strategy
The DOF Subsea Group provide essential oshore and subsea
services to the global oshore industry, and own and operate
a fleet of Subsea vessels. The Group is organised into two
business segments, Subsea/IMR Projects and Long-term Char-
tering. Included in the Subsea/IMR Projects segment are
engineering companies that are providing services within
the subsea project market. The Group's fleet is a combi-
nation of vessels on term contracts and vessels utilised
for subsea project activities. The subsea vessels on term
contracts are serving the IMR (Inspection, Maintenance &
Repair) market and the SURF (Subsea, Umbilicals, Risers
& Flowlines) market. The Group’s subsea projects include
survey, diving services, ROV operations, construction and
IMR among others. In 2021 the Group has been engaged
in several oshore wind projects of which the Hywind
Tampen project in the North Sea is considered the most
important contract and is currently the largest floating
oshore wind project in Europe.
As part of the DOF 3-year Rolling Business & Strategy Plan
and with the goal to shape a healthy, One DOF, the Vision
and Mission statements have been amended as follows:
Vision:
“The DOF Group is a trusted and leading partner delivering
services globally for a sustainable utilisation of oshore
energy and other subsea resources”
Mission:
“The DOF Group provide the technical capability, experience and
assets globally to deliver dedicated subsea and marine services
for our clients in an evolving subsea and oshore energy sector”.
The Group will continue its strategy to be engaged in
long-term and industrial oshore relationships and operate
within a mix of project contracts and time charter
contracts for its vessel and ROV fleet. The Group’s backlog
was by year-end 2021 NOK 10.4 billion, of which NOK
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5.4 billion is DOF Subsea’s share of the backlog in the
Joint Venture with TechnipFMC. This represents a high
backlog among peers.
The Group, including DOFCON JV, owns a diversified
and advanced fleet of 23 oshore vessels with a value-ad-
justed average age of approximately 7.5 years, and a fleet
of 73 ROVs including 2 AUVs. As of 31st of December
2021, the Group also had two vessels chartered in from
external owners.
The Group has oces on five continents and during the
last decade the Group has invested in key regions such as
the Atlantic (Europe, West-Africa and the Mediterranean),
Brazil, North America and Asia-Pacific regions.
The Group has its headquarter in Bergen, Norway, and
has oces located in Perth, Singapore, Manila, Jakarta,
Oslo, Aberdeen, Luanda, Rio de Janeiro, Macaé, Houston
and St. Johns. The Group is also represented in Malaysia,
Ghana, Nigeria and Guyana.
Operating segments
The challenging markets continued into 2021, however
during 2nd quarter the Group experienced increased
demand for its assets and services and the activity in
all subsea regions have increased throughout the year.
During 2021, the operations have been highly impacted
by COVID-19, especially in Brazil. This has resulted in
higher costs and o-hire for this part of the fleet.
The Group has through the year secured new contracts
with a value of NOK 4.0 billion of which the main portion
was awarded during 2nd half of 2021.
The utilisation of the Group’s fleet was 85% in 2021
Subsea/IMR Projects Long-term Chartering Total
Amounts in NOK million 2021 2020 2021 2020 2021 2020
Operating revenue 3 943 3 282 1 602 2 055 5 545 5 337
Operating result before depreciation
and impairment – EBITDA
816 602 1 192 1 585 2 087 2 187
EBITDA margin 21% 18% 74% 77% 38% 41%
Asset overview and segment result (management reporting)
Subsea 25 ROV 71 AUV 2
Average utilisation of the fleet
compared to 78% in 2020. The increase in utilisation
has been mainly within the Subsea/IMR Projects segment,
but we also see an increase in the Long-term chartering
segment. The Group has agreed the sale of three non-stra-
tegic vessels in 2021. One delivered to its new owner in
Q2 2021, one delivered in January 2022 and one that
will be delivered after its current contractual obligations.
Long-Term Chartering segment
The Long-term Chartering fleet was by year-end eight
vessels whereof seven vessels are PLSVs and six vessels
are owned via the Joint Venture DOFCON, (50/50 owned
by DOF Subsea and TechnipFMC). The Long-term Char-
tering fleet has achieved a utilisation rate of 95% in
2021 (91%) and had no vessels in lay-up. The main
operational area for the fleet has been Brazil, but one
vessel has operated on firm contract in Argentina and
one vessel on firm contract with world-wide operations.
By year-end the backlog for the Long-term Chartering
segment was NOK 6.1 billion (NOK 7.6 billion), of which
NOK 5.4 billion in the Joint Venture with TechnipFMC.
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dof subsea integrated annual report 2021
The Joint Venture with TechnipFMC in Brazil is an
important contributor to the Long-term Chartering
segment. All six vessels in the Joint Venture with Tech-
nipFMC achieved a utilisation above 90% through the
year. Four of the vessels are committed on long-term
contracts with Petrobras with a remaining duration of
2-5 years. The two remaining JV vessels have been on
bareboat contracts with TechnipFMC throughout the year,
these vessels were awarded 3-year PLSV contracts with
Petrobras and will commence on the contracts in 2022.
Subsea/IMR Projects segment
By year-end, the Group operated 17 subsea vessels in
the Subsea/IMR Projects segment, of which 2 vessels
was hired in from external owners. By year-end, 1,465
employees were engaged in this part of the business
which is an increase of 25% since 2020. The Subsea/IMR
Projects represented 71% of the Group’s total revenue in
2021 (management reporting). The Subsea/IMR Project
activities have been performed from four regions; the
Asia-Pacific region, the Atlantic region, the Brazil region,
and the North America region. The overall utilisation of
the Subsea/IMR Project fleet during 2021 was 80% (71%).
Total backlog for the Subsea/IMR Projects segment is
NOK 5 billion (NOK 3.7 billion).
In the Asia-Pacific region various IMR frame agreements
were the core activities, in addition to several mooring
installations and some diving projects. Two vessels have
continued to operate on firm contracts, one in the Phil-
ippines and one outside Australia. The remaining fleet
has operated in the project market mainly on short-term
contracts and with variable clients.
The Atlantic region includes operations in the North
Sea, Mediterranean and West Africa where the activities
in 2021 have mainly been within the IMR segment on
existing infrastructure, FPSO installations, decommission-
ing and mooring projects for clients mainly within O&G
markets, but also within renewables markets (oshore
wind). The region has performed better than last year
due to an increased demand from clients. Towards end
of the year the region experienced higher activity related
to the Hywind Tampen, which include installation of 11
floating wind turbines with the capacity of 88MW, and
where DOF Subsea is responsible for towing, hook-up and
installation of the units.
The North America region includes operations in Canada,
the US Gulf of Mexico and Trinidad and Tobago. The Group
has mainly performed survey and positioning and various
vessel services from this region, in addition to supporting
the seismic industry. One vessel has operated on a firm
contract in Canada and one vessel has been hired in to
support the operations in the US Gulf of Mexico. During
the year, several of the Group's vessels have commenced
on IMR and construction projects for key clients in the
Gulf of Mexico and in Trinidad and Tobago.
The Brazil region include vessels and ROVs on firm
contracts. The operations in Brazil have been very chal-
lenging after the COVID-19 outbreak resulting in o-hire
and increased costs. The region has, however, managed to
fulfil its contracts obligations and successfully protected
the employees. During 2021, the activity in Brazil has
grown after award of multiple contracts, and several
contracts have started during the year.
The market
The market outlook for 2022 has improved mainly based
on new Covid variants have being contained and lighter
measures being enforced. However, the geopolitical picture
encourages a more conservative view to the otherwise
promising 2022 outlook. The oil price has seen levels
above USD 100/ bbl in the first 3 months, with a steep
rise in March, based on the market’s response to the
geopolitical instability and potential supply challenges.
Based on external analysis the Company observes that
the oil prices are likely to continue to climb, and the
oil and gas macroenvironment continues to be dynamic.
Gas demand had a strong rebound in 2021, but growth
is expected to moderately increase in 2022, up by 2.2%
y-o-y. Further gas demand gains in 2022 are expected
to be strengthened by ongoing economic improvements,
as well as coal-to-gas switching. However, exceptionally
high gas prices and geopolitical instability may temper
demand gains.
Total oshore capex is expected to rise 11.3% with both
oshore deep-water and oshore shelf adding 14.2%. The
five-year CAGR for capital expenditures towards 2026 is
estimated at 4% with growth in all supply segments over
the five-year period, according to Rystad Energy.
Rig market conditions are improving with utilisation
and day rates having now risen past start-20 levels. The
outlooks are optimistic with positive sentiment that the
utilisation and rate gain, seen in 2021, can be built upon
in 2022. Rig demand is projected to rise by 9% this
year to stand at 522 units at end-22 (85% utilisation).
Mid-term demand is projected to rise by a further 8% in
2023, with utilisation reaching 89% towards end of 2023.
The overall oshore vessel market is expected to increase
towards 2030. Overall oshore oil and gas is expected to
slowly increase towards 2027, before declining towards
the end of the decade. Regional growth markets that do
not adhere to the curve are South America, Middle East
and Africa that all deliver considerable growth. Oshore
wind will continue to grow from 2025 towards 2030,
taking up an increasingly larger share of the total global
vessel demand. Spending on oshore installation segments
is expected to increase by an average of 32% from 2021
to 2022. The pressure from a growing oil and gas price
with growing oshore wind capex might increase the
demand for AHTS and subsea vessels on short, medium
and long term.
Social and Environmental Sustainability
Having sustainable operations is important for the Group.
The successful balance between social, environmental and
economic elements allows the Group to develop ‘Sustain-
able Operations’. This ensures that the Group remains
commercially feasible, socially acceptable and works within
the capacity of the external environment.
During the entire year tremendous eorts and sacrifices
have been made to protect our crew and employees towards
COVID-19. Continuously changing regulations and demands
from government and health authorities all over the world,
36
dof subsea integrated annual report 2021
have loyally been followed by our employees in a stoic
and supporting way. Despite all of eorts and precautions,
several employees ended in CRU units for months. However,
all are now out of hospitals and supported by DOF and
health professionals to get back to work.
The Group acts responsibly and ethically everywhere it
operates, and the Group’s operations and decisions are
guided by the values – Respect, Integrity, Teamwork,
Excellence – RITE – and above all we are Safe. This
ensures honest, fair and equitable operations, protecting
and building the Group’s reputation.
‘Safe the RITE way’ is the guiding philosophy by which
the Group safeguards its people, external environment,
vessels and subsea assets. ‘Safe the RITE way’ is the
umbrella for the safety program which brings together
core values and connects them to strategic areas for
sustainable operations.
The Group is guided by the articles of association, the
Corporate Governance and Group policies, combined with
the Group’s Code of Business Conduct, ensuring that the
Group’s operations consider the interests of all stakeholders.
The Group promotes transparency and standard disclo-
sure of information relating to key sustainability aspects.
As part of this, the Group reports according to CDP and
the Global Reporting Initiative. Detailed reporting on
these matters is included in the sustainability section
in the Annual Report.
As DOF’s sustainability eorts evolve, expand, and become
more comprehensive, so do also our stakeholders and
their material interest in our activities. It is therefore
of the utmost importance that DOF has eective mecha-
nisms and reporting structures to communicate financial
and non-financial information to these interested parties.
This year, DOF has adopted the World Economic Forum’s
Stakeholder Capitalism Metrics of; People, Planet, Pros-
perity and Principles.
Not only does this framework compliment DOF’s vision of
creating broad stakeholder value, but it promotes a core
set of non-financial metrics and disclosures for investors
and stakeholders alike. DOF is committed to the pillars
of People, Planet, Prosperity and Principles and believes
this concept is integral to future sustainability initiatives
and communication.
All the Group companies are certified to ISO 9001:2015,
ISO 14001: 2015, and ISO 45001:2018. The certificates
are issued at Group (DOF ASA) level, and valid until
December 2023.
Employees
The market conditions required the organisation to adapt
its capacity and posed a threat to the Group’s human
capital. At the end of 2021, the headcount in the Group
was 1,463 people, of which approximately 15% were women.
887 men and 169 women are under full-time permanent
contract. Further distribution is 33 men and 3 women on
full-time temporary contract. 286 men and 29 women are
self-employed workers. 5 men and 4 women have part-time
permanent contract. Finally, 7 men and 6 women are
working under part-time temporary contracts.
The market is still challenging with regards to contract
terms and rates, and the Board of Directors is contin-
uously monitoring the need for the Group to adapt its
capacity. The aim going forward will be to keep the capa-
bility to maintain the Group’s flexible workforce and to
retain core competencies.
Equal opportunities and anti-discrimination
The Group has focus on diversity and strives to create
equal opportunities for all employees, regardless of their
ethnic background, nationality, descent, colour, language,
religion, lifestyle or gender. The Group’s ‘Equal Employ-
ment Opportunity’ policy clearly states that the Group
is committed to be an equal opportunity employer. This
means that all business units within the Group will select
and appoint the most suitable person for a position based
on their attitude, skills and qualifications. The Group also
has a zero-tolerance policy for workplace harassments.
Despite all eorts we sadly have to report one sexual
harassment case in 2021.
Our campaign to promote and secure retention of female
managers and captains has been continued from 2020,
with communication internally and externally. Several
measures such as flexible work hours, and working from
home, have been promoted to secure a balanced workforce
and to create equal opportunities. This also includes
dialogue with labour unions for flexible oshore rotation.
Human Rights and Labour standards
The Group embraces practices consistent with international
human rights standards and operates in compliance with
fundamental as well as local labour standards. The Group’s
policies and standards are based on International Labour
Organisation (ILO) conventions, and they prohibit any
use of forced or child labour. The Group recognises and
respects employees’ right to freely associate, organise and
collectively bargain, and the policies are compliant with
working hour requirements as established by local laws.
Several initiatives have been taken during the year
to ensure that slavery and human tracking are not
occurring within the supply chain nor in any part of
the Group’s activities. The Group’s human rights and
slavery statement is available on the Group’s website.
In 2020, Amnesty International ranked DOF in the top
five global companies based in the Nordics with the best
score related to human rights and responsible employer.
Health, safety, and the working environment
Throughout 2021, the Group has experienced several
COVID-19 cases among employees. Some cases resulted
in hospitalisation, but there have not been any fatalities.
Cases have been handled by regional emergency response
teams, in close dialogue with the corporate emergency
response team and company doctors.
At the end of the year when the Group started to prepare
for a normalisation, the new OMICRON variant hit the Group
hard and hundreds of employees were infected. Neverthe-
less, due to high vaccination rate in DOF, the impact and
symptoms of the infection was greatly reduced in most cases.
37
dof subsea integrated annual report 2021
The Group will in the future handle COVID-19 outbreak as
an influenza-like infection and be guided by our medical
protocols oshore and HR handbooks onshore and loyally
follow advice directed by WHO and regional legislation.
The Group strives to improve safety and environmental
performance across all worksites, globally. The Group
experienced 1 Lost Time Incident (LTI) in 2021, which
resulted in a Lost time injury frequency rate (LTIFR)
of 0.27 LTIs per million man-hours. Combined with 3
Medical Treatment Cases and 3 Restricted Workday Cases,
the Total recordable injuries rate (TRIR) was 1.90 record-
able incidents per million man-hours.
DOF Subsea is subject to court proceedings for alleged
oences against the Oshore Petroleum and Greenhouse
Gas Storage Act 2006, in relation to a 2017 saturation
dive campaign undertaken in Australian waters. The
Matter has been before the Australian Courts with the
proceedings being concluded end March 2022. The Court`s
determination is expected to be finalized by the end of
the second half 2022.
The Group’s ambition is to be an incident free organisation.
Through the ‘Safe the RITE way’ program, the Group has
been able to establish a unified safety culture, as well as a
stronger safety cooperation with clients, industry partners
and suppliers. A survey among our oshore employees early
in the year concluded with a strong and unified safety
culture build around our values and Safe the RITE way.
In 2021, absence due to illness has been 0.79 per cent,
which is below the Group’s target of 3 per cent. The
working environment is monitored by various means of
activities, including working environment surveys.
Business integrity and ethics
Integrity is the core of multiple aspects of the Group’s
business model, both from an internal and external perspec-
tive. As one of the governing core values, the Group has
established integrity training throughout the organisa-
tion. This seeks to ensure sound business practices and
decisions determined and executed in accordance with the
Group’s Code of Business Conduct, promoting everyone to
display professional competence, due-diligence, confidenti-
ality and professional behaviour in everything we do on
behalf of the Group.
A new Ethics Helpline was launched in 2019. The helpline
is operated by a third-party company and provides a
platform for reporting unacceptable conduct, when normal
reporting lines cannot be used. The helpline allows for
communication with the reporters even if they prefer to
be anonymous, which can be essential during investigations.
Anti-corruption and anti-bribery
The Group has a zero-tolerance policy for bribery and
corruption. The Group’s policy is to conduct all business
in an honest and ethical manner. The Code of Business
Conduct sets clear expectations for all employees and is
supplemented by internal training.
It is the desire of the Board of Directors that the Group
shall be recognised by its high ethical standards. Anti-cor-
ruption and anti-bribery measures are regularly evaluated
and assessed to ensure that they are aligned with legal
requirements and best practice. There have been no
confirmed incidents of corruption during 2021.
Compliance with law
The Group acknowledges the importance for its internal and
external stakeholders of being a reliable partner, compli-
ance is therefore a key topic for the Group. Compliance
with both international and local laws and regulations
and industry standards is important for the Group. In
2021, there have been no significant fines or non-mon-
etary sanctions for non-compliance with laws and/or
regulations in the social and economic area.
External environment
The Group’s environmental management system ensures
that the operations are eectively managed, and that
continuous improvement of environmental performance
is achieved. The energy eciency program of the Group
is continuously challenged with the aim to improve envi-
ronmental performance.
During 2021, the focus on energy eciency has increased
by implementing Key Performance Indicators (KPIs) related
to environmental performance, e.g. energy consumption
and CO2 emissions. During the year, there have been no
major spills to the external environment and no spills
that resulted in fines or other non-monetary sanctions
from local governments.
Climate change and emissions to the air
The Group has several processes to ensure that direct
and indirect climate influencing activities are kept at a
minimum and consistent with the Group’s overall approach
to climate change.
Defining and measuring environmental sustainability and
risks associated with the Group’s business activities are
important. Investments in systems and equipment have
been made to record, understand and improve environmen-
tal performance. This has been achieved through SEEMP,
ISO 14001 and CDP, where the DOF Group achieved a
score of B in 2021.
Through continued focus on technologically advanced
vessels and an improved environmental culture on all
levels of the organisation, the Group strives to achieve
the objective of a reduction in CO2 emissions through
reduced fuel consumption.
Continuous improvement of our operations
It is the view of the Board of Directors that continuous
improvement helps to reduce risk, improve perfor-
mance and align ways of working. Through the Group’s
improvement program, the Group has streamlined and
systematised its improvement work. Based on thorough
planning, improvement projects have been carried out
through the Group’s value chain, focusing on stand-
ardisation and improved efficiency. The improvement
initiatives will continue in 2022.
Risk Management and Compliance
The global community is witnessing the invasion of Ukraine,
and the Group see the repercussions of fractured tensions
in international cooperation. However, the Group has not
38
dof subsea integrated annual report 2021
identified any potential exposure to assets or operations in
Eastern Europe, specifically Ukraine and Russia. 2022 will
undoubtedly be a year that requires strong global govern-
ance and eective risk management eorts. Crises prompt
unexpected and unpredictable paths, as exposed by COVID-19.
DOF will continue enforcing our Values as guiding princi-
ples of good corporate governance and behaviour. Having
recognised reference points, like our company Values and
Code of Business Conduct is essential to navigating DOF
through the volatile, uncertain, complex, and ambiguous
challenges we will see unfold in the coming year.
The Group’s risk management and internal control are
based on the principles in the Norwegian Code of Practise
for Corporate Governance. The Board of Director’s view
is that continuous improvement of the Group’s operations
in a systematic manner is a necessity in order to manage
risks and realise opportunities to ensure ecient opera-
tions in line with the stakeholder’s expectations.
The Group has established routines for weekly, monthly
and quarterly reporting regarding operations, liquidity,
financing, investments, HSEQ, HR, taxes and legal perfor-
mance. Five-year financial forecasts including information
on market assumptions are prepared on a regular basis.
The Group carries out annually detailed budget processes
at all levels. Due to generally challenging markets and
the Group’s weak financial position, the focus on liquidity,
profit or loss forecast control and financial compliance
control has been high during the year.
The operational and financial processes are standard-
ised, and the same reporting and control structures are
in use for all companies in the Group. These processes
are integrated in the Group’s ERP system and supported
by the Group’s policies, guidelines and standards in the
Business Management System (BMS).
The Group’s due diligence processes have been strength-
ened in recent years and involve the global competence
within legal, finance and ESG. The new vendor evalua-
tion database allows management to assess the suppliers
and subcontractors towards the Group’s requirements
for ESG. The process is built upon UN Global Compact
guidelines and ISO standards. The new DOF Workbook is
the foundation for all the training in the years to come.
The modules have a holistic approach and will be the
centre of compliance for all our activities as well as the
Group stakeholders’ expectations for DOF to be a leading
company, aligning its activities with the UN’s sustaina-
bility development goals.
Investment in modern communication tools has enabled
global alignment to streamline the organisation, allowing
further development of our human and organisational capital.
Alignment towards the Norwegian Transparency act
On July 1st 2022 the Norwegian Transparency Act will enter
into force and DOF has been part of the ocial hearing
process on the new law and given concrete proposal on
practical means to obey the intension of Transparency Act
based on our experience on how we deal with fundamental
human rights and decent working conditions globally. The
organisation is aligned and prepared for the new requirements.
Shareholders & the Board
The share capital of the Company by year-end 2021 was
NOK 1,673,527,620, divided by 167,352,762 number of shares.
DOF ASA owns 100% of the shares in DOF Subsea AS.
The Company has signed D&O insurance on behalf of
the board members and executive management to protect
against claims which may arise from the decisions and
actions taken within the scope of their regular duties. The
insurance policy is signed with international reputable
companies.
Corporate Governance
The Group’s Corporate Governance is based on princi-
ples established in the Norwegian Code of Practice for
Corporate Governance, available at www.nues.no. The
parent company DOF ASA prepare the Corporate Govern-
ance report for the Group. DOF Subsea is aligned and
follow principles presented in DOF ASA`s Corporate
Governance report.
Financial performance
Group revenue in 2021 totalled NOK 4,303 million (NOK
3,984 million), with an operating profit before depre-
ciation and finance (EBITDA) of NOK 1,378 million
(NOK 1,661 million). The main reason for a lower margin
in 2021 versus 2020 has been a higher activity from subsea
projects where the margins are normally lower than from
vessels on time charter contracts. The EBITDA in 2020
was further positively impacted by significantly strength-
ened USD to NOK and BRL during 1st half of the year
and one-o termination fees due to cancelled contracts.
The net result from the DOFCON JV was significantly
better in 2020, mainly due to changes in deferred tax.
A net gain of NOK 78 million (NOK 3 million) represent
gain from sale of two vessels.
Consolidated profit or loss
Amounts in NOK million 2021 2020 Change
Operating revenue 4 303 3 984 8%
EBITDA 1 378 1 661 -17%
Depreciation -665 -449 -33%
Impairment -172 -2 471 93%
EBIT 541 -1 260 143%
Operating profit (EBIT) amounted to NOK 541 million
(NOK –1,260 million) of which depreciation represent
NOK 665 million (NOK 449 million) and impairment
represent NOK 172 million (NOK 2,471 million). In addition,
the impairments in the JV amount to NOK 98 million
(NOK 121 million). The basis for the impairment is fair
market values received from independent broker companies
and value in use (VIU) calculations. There is still a risk
for further impairment of the fleet and the booked vessel
values are further exposed to volatility in FX rates.
39
dof subsea integrated annual report 2021
Net financial income/loss in 2021 totalled NOK -413
million (NOK -852 million), of which finance expenses
represented NOK -618 million (NOK -690 million). Finance
income amounts to NOK 339 million (NOK 58 million)
and has been positively impacted by a gain of NOK 249
million after prepayment of a loan facility at a signifi-
cant discount. The net currency loss and changes in fair
value of financial instruments amounted to NOK -134
million (NOK -221 million).
Taxes amounted to NOK -46 million (NOK -126 million).
The Group reported a profit for 2021 of NOK 82 million
(NOK –2,237 million) and adjusted for other comprehen-
sive income the net result was NOK 161 million (NOK
–2,259 million).
The consolidated balance sheet at year-end 2021 totalled
NOK 12,812 million (NOK 12,806 million). Vessels and
subsea equipment of NOK 7 226 million (NOK 7,696
million) and investments in associated companies and
joint ventures of NOK 2,802 million (NOK 2,391 million),
are included in non-current assets of NOK 10,151 million
(NOK 10,342 million). Total non-current assets represent
79% of the Group’s total assets.
The Group’s cash reserve has dropped from NOK 1,330
million to NOK 1,183 million in 2021 even though stand-
still agreements have been applicable for the majority of
the Group’s debt. This is mainly due to instalments on
debt, increased capital expenditure partly due to postponed
class dockings from 2020 and higher activity in the subsea
regions, which has impacted the working capital. Restricted
cash by year-end was NOK 116 million (NOK 118 million).
Parts of the Group’s unrestricted cash is not immediately
available partly due to the existing standstill agreements, see
note 17 'Cash and cash equivalents' for further information.
Consolidated balance sheet
Amounts in NOK million 31.12.2021 31.12.2020 Change
Non-current assets 10 151 10 342 -2%
Cash and cash
equivalents
1 183 1 330 -11%
Equity 2 594 2 433 7%
Net interest bearing
debt
7 784 7 807 -0,3%
The Group’s booked equity by year-end 2021 is NOK 2,594
million (NOK 2,433 million).
The Group reported net interest-bearing debt of NOK 7,784
million (NOK 7,807 million) as of 31st of December 2021.
Current liabilities totals NOK 9,985 million (NOK 10,042
million), of which NOK 9,100 million (NOK 9,258 million)
represent interest-bearing debt where standstill agreements
have been applicable and negotiations with the lenders
have been ongoing since 2nd quarter 2020. As a conse-
quence of that a long-term refinancing solution is not yet
in place, the relevant interest-bearing debt is classified as
short-term based on that the standstill agreements with the
secured lenders and bondholders are less than 12 months.
The Group’s net cash flow from operating activities was
NOK 704 million (NOK 881 million) of which NOK –89
million is paid interest and other finance cost. Due to the
standstill agreements, NOK 421 million of interests has
been capitalised on loans. The net cash flow from invest-
ments activities was NOK -152 million (NOK 112 million)
of which NOK -436 million (NOK -119 million) represent
main class renewals and conversions of vessels, and NOK 291
million (NOK 300 million) is mainly repayment of share-
holders loan from the Joint Venture with TechnipFMC and
NOK 95 million (NOK 3 million) are mainly contribution
after sale of vessels. Cash flow from financing activities
was NOK -715 million (NOK -205 million) of which NOK
-722 million (NOK -435 million) represent instalments on
debt. Net changes in cash and cash equivalents for the
year was NOK -163 million (NOK 788 million).
Parent company financial statements
The parent company financial statements for 2021 show
a revenue of NOK 91 million (NOK 99 million) and an
operating profit of NOK 27 million (NOK -33 million).
Net financial items are NOK 319 million (NOK –2,216
million) and are impacted by reversal of impairment on
investments in subsidiaries and associates of NOK 652
million (NOK –1,531 million). Profit before taxes were
NOK 345 million (NOK -2,250 million) and profits for
the year were NOK 362 million (NOK -2,339 million).
The parent company's balance sheet as of 31st of December
2021 totals NOK 4,782 million (NOK 3,917 million), of which
booked equity totalled NOK 776 million (NOK 415 million).
Financing and capital structure
The Group’s interest-bearing debt by 31st of December
2021 comprise secured debt of NOK 5,562 million (NOK
5,987 million), unsecured bond loan of NOK 2,979 million
(NOK 2,554 million) and unsecured other debt of NOK
285 million (NOK 339 million). The main portion of the
debt is drawn in USD.
The majority of the Group's vessels built in Brazil are
financed by BNDES (Brazilian Development Bank), with
tenor on average of 18-20 years and a fixed interest rate
for the full duration of the loans. The remainder of the
secured debt represent funding from Export Credit insti-
tutions (Eksportfinansiering Norge - Eksfin) and reputable
European banks.
The Board and Management have, since the second quarter
of 2019, been working on a long-term refinancing solution
for the Group which includes discussions with secured and
unsecured lenders.
The restructuring of the Group’s debt has been ongoing
in 2021 and standstill agreements have been agreed until
the 30th of April 2022 with 95% of the secured lenders
in the DOF Subsea Group. The BNDES facilities in DOF
Subsea Brasil Ltda. has been served according to refinancing
agreements signed in February 2020. The standstill agree-
ments assume payment of principal and interest of a NOK
100 million credit facility provided by certain lenders in
March 2020. The outstanding amount of this facility was
NOK 47 million by the end of the year.
The relevant Group companies have imposed unilateral
40
dof subsea integrated annual report 2021
standstill to the secured lenders not participating in the
standstill agreements. One of the DOF Subsea secured
lenders has previously requested repayment of a facility of
USD 47 million, and in the 3rd quarter this facility was
prepaid at a significant discount. Another secured lender
has enforced an account pledge for one loan facility in
DOF Subsea.
The ad hoc group of bondholders in DOFSUB07, DOFSUB08
and DOFSUB09 have accepted a standstill until the 30th
of April 2022.
The DOFCON JV is not part of the standstill agreements
and serves its debt according to the terms in the relevant
loan facilities. Financial covenants related to the Group’s 50%
guarantee of the DOFCON loan facilities have been waived.
The Group will continue the dialogue with its creditors
to secure a long-term financial solution for the Group.
The refinancing proposal currently discussed include a
comprehensive restructuring of the Group’s balance sheet
which include softer terms on the loan facilities and
conversion of substantial amounts of debt to equity.
Risk
The Group has limited exposure to Russia and Ukraine,
however the general risk has increased following the
invasion of Ukraine and the impact on the world economy.
The Covid pandemic may further impact the Group’s
results going forward.
Climate risk
The Group's ability to manage GHG Emissions is a key
component of the organisation’s ESG profile. Providing
a vessel fleet and services with reduced GHG emissions
can become a value proposition for clients and investors
or negatively impact upon competitiveness of the organ-
isation against peers. The main concern is the Group’s
ability to meet changing stakeholder expectations associ-
ated with Greenhouse Gas emission from ships, including
Nitrogen Oxides, Sulphur Oxides and Particulate Matter
in harbour areas.
Financial and liquidity risk
The Group is exposed to financial and liquidity risk
through its operations and periodical maintenance of
existing vessels and the requirement for refinancing.
The Group has executed a substantial newbuilding
programme in the period from 2010 to 2019 and has
historically achieved satisfactory long-term financing of its
new buildings. However, a sustained weak market since
2015 has increased the refinancing risk for the Group
significantly, and the Group has since 2019 experienced
that regular refinancing has been impossible.
Currency risk
The Group operates globally and is exposed to foreign
exchange risk arising from various currency exposures,
mainly with respect to USD towards NOK and BRL, but
is also exposed to AUD, EUR, CAD and GBP. Foreign
exchange risk arises from future commercial transactions,
contractual obligations (assets), liabilities and investments
in foreign operations. The Group aims to achieve a natural
hedge between cash inflows and cash outflows to secure
the debt funding in equivalent currency as the committed
earnings from the charter contracts, and further to manage
the remaining foreign exchange risk arising from commer-
cial transactions, through forward contracts and similar
instruments as appropriate. However, due to the current
financial position for the Group, new forward contracts
have become more challenging. Hence, the Group’s liquidity
risk has increased if the currencies fluctuate.
Interest rate risk
The Group is exposed to changes in interest rates as parts
of the Group’s liabilities have a floating rate of interest.
Financing via BNDES in Brazil is secured at a fixed rate
of interest throughout the duration of the loan. Due to
the current financial position of the Group, hedging of
the interest risk has become more challenging. Hence,
the Group's interest rate risk has increased.
Of the Group's total debt, approximately 52% has a fixed
rate of interest. This includes financing via BNDES, GIEK/
Export Credit Norway and one bond loan (DOFSUB08).
Credit risk
The Group’s credit risk has historically been low as the
Group’s customers traditionally have had good financial
capability to meet their obligations and have high credit
ratings. The sustained challenging market situation has
resulted in changes to the credit ratings for some of the
Group's customers, and thereby increased the credit risk.
Historically, the portion of receivables not being collecta-
ble has been low. Revenue from the 10 largest customers,
large oil companies and service providers, represent approx-
imately 62% of the Group`s revenue, whereof Petrobras
represent the largest customer.
Market and price risk
The Group is exposed to cost increases in general, including
conversions and maintenance of vessels. The majority of the
Group's conversions and main class renewals are done at
fixed prices with the yards. The Group further attempts to
reduce price risk by signing contracts with suppliers with
the necessary financial strength and expertise to complete
projects in accordance with agreements.
The Group is exposed to market fluctuations which have
resulted in lower utilisation and reduced earnings for the
Group’s vessels and services due to continuing challenging
markets since 2015. The Group’s strategy is to continue its
focus on long-term contracts for its fleet, however, during
the last five years most of the clients prefer shorter term
contract renewals. There are signs of improved markets, but
the Group has several contracts up for renewal in 2022,
hence both the price and utilisation risks are applicable.
Tax risk
The Group has a global organisation and operate vessels
and subsea services in several dierent tax jurisdictions.
The income and profit from these operations are subject to
income taxes and judgment may be involved when deter-
mining the taxable results. Tax authorities in dierent
jurisdictions may challenge the calculation of taxes payable
from prior periods through tax audits. Several tax audits
have been conducted over the last couple of years, where
41
dof subsea integrated annual report 2021
some of the tax claims are disputed by the Group, ref
note 3 'Accounting estimates and assessments'. In general,
attention from tax authorities is increasing, and the trend
is that each individual country has increased focus on
protecting their tax base.
Going concern
The consolidated financial statements and the Parent
Company’s financial statement are prepared on the assump-
tion of going concern. The Group’s financial position is
not sustainable, and there is material uncertainty related
to going concern. Rolling short-term standstill agreements
with the majority of the Group’s lenders have been in
place since 2nd quarter 2020 and the current stand-
still agreements are applicable until 30th of April 2022.
The Group is on short-term dependent on an extension
of standstill periods and on longer term dependent on a
robust refinancing solution to continue as going concern.
The restructuring proposals being discussed with the
secured lenders and bondholders include conversion of
debt to equity. The dialogue with the lenders is construc-
tive, but a refinancing solution is not yet in place. The
Group is dependent on continued standstill agreements
with its creditors until a long-term financial solution is
agreed to maintain as going concern.
Profit & loss allocation
The parent company financial statements have a profit for
the year of NOK 362 (NOK -2,339 million). The Board of
Directors proposes to allocate the profit to other equity.
The consolidated financial statements have a profit for the
year of NOK 82 million (NOK -2,237 million), and total
comprehensive profit of NOK 161 (NOK -2,259 million), of
which NOK -10 million (NOK -50 million) is attributed
to non-controlling interests and NOK 171 million (NOK
-2,209 million) is allocated to other reserves.
Events after balance sheet date
New contracts
DOF Subsea has been awarded an extension of the current
contract with a key renewable’s client for Skandi Acergy
in the North Sea and another project in Trinidad and
Tobago for the vessel Skandi Constructor. The DOF Subsea
Asia-Pacific region has further been awarded a 3-year
contract plus 2 x 1- year options to provide a Multi-
Purpose Supply Vessel (MPSV) to Esso Australia Pty Ltd.
In Australia DOF Subsea has been awarded Woodside
Energy Limited's Enfield XT Retrieval and Oshore
Support Services contract, expected to be undertaken in
Q3 and Q4 2022, utilising MPSV Skandi Hercules. DOF
Subsea USA has been awarded the first SURF project
for the Skandi Constructor from Vaalco Energy at the
Etame field, oshore Gabon. Engineering and design work
has commenced with subsea work forecasted to begin in
July and expected to be completed by September 2022.
In addition DOF Subsea won multiple new contracts with
Renewables and Oil & Gas utilising Skandi Acergy, Skandi
Constructor, Skandi Hera and selected third-party vessels
for 185 vessel days. In GOM DOF Subsea has entered
into an agreement with Otto Candies for the charter of
the Jones Act compliant vessel Chloe Candies for a firm
period of one year from May.
Assets
The current charterer of Geosea, owned by DOF Subsea
Rederi AS, has excercised its purchase option, with delivery
during 2nd or 3rd quarter 2022.
Finance
On 31st of March 2022, DOF ASA and DOF Subsea AS
have agreed to further extend the principal and interest
suspension agreements with, or received extensions of
similar concessions from, secured lenders representing
in total 95% of the secured debt of companies within
the Group (excluding DOF Subsea Brasil Servicos Ltda.)
until the 30th of April 2022. The ad hoc group of bond-
holders in DOF Subsea AS have agreed to further extend
the standstill agreement until the 30th of April 2022,
in accordance with the resolution in the bondholders'
meeting held 28 February 2022. The extensions of the
standstill periods will facilitate the Group’s continued
dialogue with its secured lenders and the bondholders
under the Group’s bonds regarding a long-term financial
restructuring of the Group.
Outlook
The O&G markets have improved as several regions have
seen increased activity in all the Group’s segments towards
end of the year and a high tender activity has continued
into 2022. The current situation in Eastern-Europe has
however created instability in the world economy and it
is dicult to predict how the market will respond to this
situation going forward. The Group’s financial position
is further not sustainable as the Group has through
2021 operated in an environment with short-term stand-
still agreements (often monthly extentions). If a robust
long-term refinancing solution is not achieved, the Group
cannot continue as going concern. If the Group cannot
be treated as going concern the valuation of the Group’s
assets will be further revised and will result in signifi-
cant impairment of the Group’s assets.
The annual report is prepared on the assumption of going
concern and this assumption is based on agreed standstill
agreements (applicable until 30th of April 2022) with the
majority of the Group’s lenders. The debt restructuring
currently discussed include soft terms on the loan facilities
and conversion of substantial amounts of debt to equity. The
dialogue with the lenders has continued to be constructive
and progress has been made so far into 2022. There are
still some issues pending, and a refinancing solution is
not yet in place.
In parallel with the ongoing debt restructuring, the manage-
ment and Board have continued the focus on operational
and cost eciency improvements and on implementation
of new technology and digital solutions. In response to the
ongoing shift in the energy markets and future customer
requirements, the Group has a strong forward-looking
focus on developing strategic opportunities and new lines
of business utilising the Group's combined fleet, services,
and competence within the limitations of the financial
42
dof subsea integrated annual report 2021
position due to the debt restructuring of the Group.
The Company emphasizes that the information included
in this annual report contains certain forward-looking
statements that address activities or developments that
the Company anticipates will or may occur in the future.
The statements are based on assumptions and estimates,
and some of them are beyond the Company’s control and
therefore subject to risks and uncertainties.
The Board of Directors is thankful for the eort from all
employees through 2021.
Kathryn M. Baker
Director
Bergen, 6th of April 2022
The Board of Directors of DOF Subsea AS
Hans Olav Lindal
Chairman
Marianne Møgster
Director
Helge Singelstad
Director
Mons S. Aase
CEO
Harald Thorstein
Director
43
dof subsea integrated annual report 2021
financial statements / dof subsea group
Financial Statements
DOF Subsea Group
Accounts - DOF Group
52
dof subsea integrated annual report 2021
financial statements / dof subsea group
DOF Subsea Group Amounts in NOK million
Consolidated statement of comprehensive income
Note 2021 2020
Operating revenue 4, 5 4 303 3 984
Payroll expenses 6 -1 395 -1 371
Other operating expenses 7 -1 905 -1 529
Share of net income from joint ventures and associates 28 296 573
Profit from sale of non-current assets 11 78 3
Operating profit before depreciation and impairment (EBITDA) 4 1 378 1 661
Depreciation and impairment
11,13 -837 -2 921
Operating profit (EBIT) 541 -1 260
Financial income 8 339 58
Financial expenses 8 -618 -690
Realised net gain / loss on derivative instruments and currency position 8 -145 -465
Unrealised net gain / loss on derivative instruments and currency position 8 11 244
Net financial income / loss 8 -413 -852
Profit / loss before tax 4 128 -2 112
Income tax expense
9 -46 -126
Profit / loss for the year 82 -2 237
Other comprehensive income net of tax
Items that may be subsequently reclassified to profit / loss
Currency translation difference (CTA) -36 25
Share of other comprehensive income of joint ventures and associates 28 115 -47
Items that will not be reclassified to profit / loss
Other comprehensive income net of tax 79 -22
Total comprehensive income net of tax 161 -2 259
Profit / loss attributable to
Non-controlling interests
27 -10 -50
Owners of the parent
27 92 -2 187
Total comprehensive income / loss attributable to
Non-controlling interests 27 -10 -50
Owners of the parent 27 171 -2 209
Earnings per share
Basic and diluted earnings per share (NOK) 10, 18 0.55 -13.07
53
dof subsea integrated annual report 2021
financial statements / dof subsea group
DOF Subsea Group Amounts in NOK million
Consolidated statement of financial position
Assets Note 31.12.2021 31.12.2020
Tangible assets
11, 13 7 226 7 696
Deferred tax asset 9 9 9
Investments in joint ventures and assosiates 28 2 802 2 391
Other non-current assets 12, 14, 22 114 246
Total non-current assets 10 151 10 342
Trade receivables 15 975 628
Other current receivables 16, 25 503 485
Current receivables 1 478 1 113
Restricted cash 17 116 118
Unrestricted cash and cash equivalents 17 1 067 1 212
Cash and cash equivalents 1 183 1 330
Asset held for sale - 20
Total current assets included assets held for sale 2 661 2 464
Total assets 12 812 12 806
54
dof subsea integrated annual report 2021
financial statements / dof subsea group
Kathryn M. Baker
Director
Bergen, 6th of April 2022
The Board of Directors of DOF Subsea AS
Hans Olav Lindal
Chairman
Helge Singelstad
Director
Marianne Møgster
Director
Mons S. Aase
CEO
Harald Thorstein
Director
Equity and liabilities Note 31.12.2021 31.12.2020
Paid-in equity 18 1 674 1 674
Other equity 821 650
Non-controlling interests 27 99 109
Total equity 2 594 2 433
Bond loans 19 - -
Debt to credit institutions 19 - -
Lease liabilities 13, 19 196 272
Other non-current liabilities 6, 9, 22 38 59
Total non-current liabilities 234 331
Current portion of debt 19 9 104 9 258
Trade payables 20 496 385
Other current liabilities 9, 21, 22, 25 385 400
Total current liabilities 9 985 10 042
Total liabilities 10 219 10 373
Total equity and liabilities 12 812 12 806
DOF Subsea Group Amounts in NOK million
Consolidated statement of financial position
55
dof subsea integrated annual report 2021
financial statements / dof subsea group
Changes in equity
Share
capital
Share
premium
Other
paid-in
capital
Paid-in
equity
Retained
earnings
Currency
translation
differences
Other
equity
Non-
controlling
interests
Total
equity
Equity at 01.01.2021 1 674 - - 1 674 561 88 650 109 2 433
Profit / loss for the year - - -
Other comprehensive income net of tax - - - - 115 -36 79 - 79
Total comprehensive income net of tax - - - - 207 -36 171 -10 161
Equity at 31.12.2021 1 674 - - 1 674 768 52 821 99
Equity at 01.01.2020 1 674 540 540 2 753 1 715 63 1 779 165 4 697
Profit / loss for the year - - - - -2 187 - -2 187 -50 -2 237
Other comprehensive income net of tax - - - - -47 25 -22 - -22
Total comprehensive income net of tax - - - - -2 234 25 -2 209 -50
-2 259
Re-allocation of paid-in capital - -540 -540 -1 080 1 080 - 1 080 - -
Changes in non-controlling interests - - - - - - - -6 -6
Equity at 31.12.2020 1 674 - - 1 674 561 88 650 109 2 433
DOF Subsea Group Amounts in NOK million
Statement of changes in equity
56
dof subsea integrated annual report 2021
financial statements / dof subsea group
Note
2021 2020
Operating profit (EBIT) 541 -1 260
Depreciation and impairment 11 837 2 921
Profit from sale of non-current assets 11 -78 3
Share of net income of joint ventures and associates 28 -296 -573
Change in trade receivables -347 -10
Change in trade payables 111 40
Changes in other working capital 37 62
Exchange rate effect on operating activities 9 30
Cash flow from operating activities 814 1 214
Interest received 36 35
Interest and other finance cost paid -89 -290
Tax paid -57 -77
Net cash flow from operating activities 704 881
Sale of tangible assets 11 95 3
Purchase of tangible assets 11 -436 -146
Purchase of intangible assets -102 -45
Net cash flows from other non-current receivables 291 300
Cash flow from investing activities -152 112
Proceeds of non-current debt 19 7 230
Installments on non-current debt 19 -722 -435
Cash flow from financing activities
-715
-205
Net change in cash and cash equivalents -163 788
Cash and cash equivalents, included restricted cash, at 01.01 17 1,330 934
Exchange rate effect on cash and cash equivalents 16 -392
Cash and cash equivalents, included restricted cash, at 31.12 17 1,183 1 330
Restricted cash at 31.12.2021 is NOK 116 million (NOK 118 million) and is included in Cash and cash equivalents. Changes in restricted cash is
reflected in the cash flow. For further information about restricted cash, please refer to note 17 `Cash and cash equivalents`.
Restricted cash of NOK 315 million (NOK 145 million) has been presented net of debt to credit institutions and are included in the
installments of non-current debt. The Group has standstill agreements with majority of the lenders and no interest and installments have
been paid duing standstill period to these lenders. For further information, please see note 19 `Interest-bearing debt`.
DOF Subsea Group Amounts in NOK million
Consolidated statement of cash flows
57
dof subsea integrated annual report 2021
financial statements / dof subsea group
DOF Subsea Group
Contents
1. Corporate information and going concern ........................59
2. Financial risk management .................................................59
3. Accounting estimates and assessments ........................... 61
4. Segment information and Management Reporting .......... 63
5. Operating revenue .................................................................65
6. Payroll expenses .................................................................... 65
7. Other operating expenses....................................................66
8. Financial income and expenses...........................................66
9. Tax ...........................................................................................67
10. Earnings per share ................................................................69
11. Tangible assets ...................................................................... 69
12. Contract cost ......................................................................... 72
13. Leases .....................................................................................72
14. Non-current assets ............................................................... 74
15. Trade receivables ................................................................. 74
16. Other current assets ............................................................ 75
17. Cash and cash equivalents .................................................. 75
18. Share capital and share information .................................. 76
19. Interest-bearing debt ............................................................ 76
20. Trade payables .....................................................................79
21. Other current liabilities .........................................................79
22. Hedging activities .................................................................. 79
23. Financial assets and liabilities
information on the balance sheet ......................................80
24. Guarantees ............................................................................. 81
25. Related parties.......................................................................81
26. Remuneration to Board of Directors
Executives and Auditor ....................................................... 83
27. Companies within the Group ...............................................84
28. Investments in joint ventures and assosiates...................85
29. Contingencies.........................................................................88
30. Events occurring after period end ......................................88
31. Accounting policies .............................................................. 88
A. Summary of significant accounting principles ...................... 88
B. Group ....................................................................................................................88
C. Segment reporting ....................................................................................... 89
D. Conversion of foreign currency ......................................................... 89
E. Classification of assets and liabilities ..........................................89
F. Cash and cash equivalents .................................................................... 89
G. Trade receivables .......................................................................................... 89
H. Tangible assets and contract costs .............................................. 89
I. Leases .................................................................................................................... 90
J. Debt ..........................................................................................................................90
K. Provisions ............................................................................................................ 90
L. Contingent assets and liabilities .......................................................90
M. Equity .....................................................................................................................91
N Transactions with non-controlling interests ............................. 91
O. Revenue recognition ................................................................................... 91
P. Current and deferred income tax ..................................................... 91
Q. Employee benefits ....................................................................................... 92
R. Financial assets.............................................................................................. 92
S. Derivative financial instruments and hedging activities .....
93
T. Events after period end ............................................................................ 93
U. Use of estimates ...........................................................................................93
V. Consolidated statement of cash flows ........................................93
W. New standards, amendments and interpretations
adopted by the Group ................................................................................ 93
X. New standards, amendments and interpretations not yet
adopted ...................................................................................................................93
32. Performance measurement definitions .............................. 94
58
dof subsea integrated annual report 2021
financial statements / dof subsea group
Notes to the Consolidated Financial Statements
1. Corporate information and going concern
Corporate information
DOF Subsea AS, the Company, is a limited liability company registered
in Norway . The Company’s head oce is located at Thormøhlensgate
53 C, 5006 Bergen, Norway.
The Company is owned by DOF ASA as a sole shareholder with 100%
ownership stake on 31st of December 2021.
DOF Subsea AS is the parent company in the DOF Subsea Group
exercising control over a number of subsidiaries. The Company also
holds investments in associates and joint arrangements.
The vision of the Group is to be a trusted and leading partner delivering
services globally for a sustainable utilisation of oshore energy and other
subsea resources.
The DOF Subsea Group has two business segments, Subsea/IMR Projects
and Long-term Chartering. In these segments, the Group provides integrated
subsea and marine services to the world’s oshore energy producers.
Integrating project management capabilities with high end subsea vessels
creates long-term client relationships, broader market opportunities
and reduces overall risk. Subsea/IMR Projects segment and the vessels
chartered to third-party companies in the Long-term Chartering segment,
increases the Group’s access to market opportunities and reduces risk.
The vessels are divided into three categories: Multi-Purpose Support
Vessels, Multi-Purpose Anchor Handler Vessels, and Construction
Support Vessels. The Group also owns a fleet of ROV assets and other
subsea equipments and has over 15 years’ experience providing ROV and
intervention services to the energy industry worldwide. The ROVs are
available on DOF Subsea operated vessels or as supplementary support
on any oshore vessel.
The financial report consist of the Group financial statements and the
Parent Company financial statements.
Going concern
In accordance with IAS 1.25, the Board of Directors confirms that
the financial statements have been prepared under the assumption of
going concern.
The consolidated financial statements and the Parent Company’s financial
statement are prepared on the assumption of going concern. The Group’s
financial position is not sustainable, and there is material uncertainty
related to going concern. Rolling short-term standstill agreements with
the majority of the Group’s lenders have been in place since 2nd quarter
2020 and the current standstill agreements are applicable until 30th
of April 2022. The Group is on short-term dependent on an extension
of the standstill period and on longer term dependent on a robust
refinancing solution to continue as going concern. The restructuring
proposals being discussed with the secured lenders and bondholders
include conversion of debt to equity. The dialogue with the lenders is
constructive, but a refinancing solution is not yet in place. The Group
is dependent on continued standstill agreements with its creditors until
a long-term financial solution is agreed to maintain as going concern.
Without continued standstill agreements or a long-term financing solution
in place, the Group can no longer present financial statements on the
assumption of going concern. If the Group cannot be treated as going
concern, the valuation of the Group’s assets will be further revised and
will result in significant impairment of the Group`s assets.
2. Financial risk management
Financial risk factors
The Group is exposed to various types of financial risk relating to its
ongoing business operations: Market risk (including foreign exchange
risk, interest rate risk and price risk), credit -and liquidity risk, capital
structure risk and tax risk. The Group’s overall risk management seeks to
minimise potential adverse eects of the Group’s financial performance.
The Group has had a policy to partly hedge interest rate risk and foreign
exchange risk, however the financial situation limits the Group in this
respect. This will increase the interest risk and foreign exchange risk
going forward.
Foreign exchange risk
The Group operates globally and is exposed to foreign exchange risk
arising from various currency exposures, mainly with respect to USD,
BRL, AUD, EUR and GBP. The Group’s presentation currency is NOK.
Foreign exchange risk arises when future commercial transactions,
contractual obligations (assets), liabilities and investments are in dierent
currencies than the presentation currency. The Group aims to achieve
a natural hedge between cash inflows and cash outflows and manages
remaining foreign exchange risk through forward contracts and similar
instruments as appropriate. However, due to the cur rent financial position
of the Group, entering into new forward contracts have become more
challenging. Hence, the Group's foreign exchange risk has increased.
Hedging of foreign exchange exposure is evaluated on a net basis.
Foreign exchange rate changes in receivables, liabilities and currency
swaps are recognised as a financial income/expense in the profit or loss
statement. Fluctuation in foreign exchange rates will therefore influence
the future results and balances.
Amounts in NOK million
Appreciation Depreceation
10% 20% 30% 10% 20% 30%
Liabilities in
currency 582 1 164 1 746 -582 - 1 164 -1 746
Investment in
joint venture -272 -545 -817 272 545 817
Net effect 310 619 929 -310 -619 -929
The Group has a significant amount of liabilities denominated in USD. In
conducting the foreign exchange rate sensitivity analysis, a hypothetical
change in exchange rates of 10%, 20% and 30% against NOK has been
used. Included in ‘Liabilities’ below are USD debt to financial institutions
and bondholders, and CAD debt to financial institutions. The Group has
subsidiaries with USD debt, where the subsidiary’s functional currency is
BRL. The eect of changes in BRL to USD are included in the sensitivity
analysis below. As the Group has a material investment in a joint venture
company which has USD as functional currency, this is included in the
sensitivity analysis. After the balance sheet date, NOK loans of 1,329
million has been converted to USD. The sensitivity analyses above will be
aected by the conversion. Conversion of loan in NOK to loan in USD
will better hedge the cash inflow and outflow for the Group.
Currency eects on other liabilities are not included in the above
sensitivity analysis. A significant portion of the Group’s operating income
is denominated in USD. A depreciation of NOK against USD will over
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a longer period have a positive impact on the Group's future earnings
and cash in NOK. Current receivables and liabilities excluding loans to
bond owners and credit institutions, are often in the same currency and
are normally due within 30 - 60 days. Over the last years the Group has
experienced that payment terms on some receivables have been extended.
Interest rates risk
The Group’s debt arrangements are both at floating and fixed interest
rates. Movements in interest rates will have eects on the Group’s cash
flow and financial condition. The Group’s policy is to maintain parts of
its debt at fixed interest rates.
In addition to fixed interest loans, the Group manages its interest risk
by using floating-to-fixed interest rate swaps. Such interest swaps have
the economic eect of conversion from floating interest rates to fixed
interest rates. Through interest rate swaps, the Group agrees with other
parties to exchange, at specified intervals the dierence between fixed
interest rates and floating interest rates calculated by reference to the
agreed amounts. Due to the cur rent financial position of the Group,
entering into new interest rate swaps have become more challenging.
Hence, the Group's interest rate risk has increased.
Debt related to financing of vessel built in Brazil is secured at fixed
interest rates for the entire duration of the loan. The portion of debt
secured with fixed rate of interest is 52% per year-end and this includes
financing via BNDES and GIEK/Export Credit Norway.
The Group has an interest risk in the change in value for the interest
rates swaps. In accordance with IFRS, the Group provides information
about the potential risk with a sensitivity analysis. The table below
shows the change in Mark-to-market (MTM) on interest rate swaps at
year-end with an increase and decrease of 100bps in 2021.
Amounts in NOK million
2021 figures 100bp decrease 100bp increase
NOK
Interest rate swaps 8 -8
Price risk
The Group is exposed to price risk at two main levels:
- The demand for the Group’s vessels is sensitive to changes in the
oil industry, for example oil price movements, exploration and general
activity level within the oshore energy industry. This aects both the
pricing and the utilisation of the Group’s assets.
- The costs of construction and maintenance of assets and replacements
of assets are sensitive to changes in market prices.
The Group attempts to reduce price risk by long-term contracts and
frame agreements with key suppliers.
The Group is exposed to market fluctuations which may result in lower
utilisation and reduced earnings for the Group’s vessels and services.
Attempts are made to reduce this risk by entering into contracts that
secure long-term charters for the main portion of the fleet.
The markets in 2021 have continued to be challenging which has negatively
impacted the earnings and utilisation of the Group’s fleet. There are signs
of improved markets and the Group has several contracts up for renewal
in 2022, hence the price risk is applicable.
Credit and Liquidity risk
Credit and liquidity risk arise from cash and cash equivalents, derivatives,
financial instruments and deposit with banks as well as payment terms
towards clients and suppliers. Liquidity risk management implies
maintaining sucient cash and marketable securities, and to maintain
available funding through committed credit facilities. The Group has a
policy of limiting the credit exposure to any single financial institution
and bank, and actively manages its exposure in order to achieve this.
To have available liquidity in all subsidiaries at all times might be
challenging due to challenging market conditions.
The Group’s counterparty credit risk has historically been low as the
Group’s customers traditionally have had good financial capability to
meet their obligations and have had high credit ratings. The sustained
challenging market situation has resulted in changes to the credit ratings
for some of the Group’s customers, and thereby increased the credit risk.
Historically, the portion of receivables not being collectable has been
low. Revenue from the 10 largest customers, large oil companies and
service providers, represent approximately 62% of the Group`s revenue,
whereof Petrobras represent the largest customer.
Liquidity risk management implies maintaining sucient cash, marketable
securities, available funding through committed and uncommitted credit
facilities and ability to close market positions. For further information
about cash and cash management, see note 17 ‘Cash and cash equivalents’.
The standstill agreements and the short-term liquidity loan o NOK 100
million drawn in 2020, covers the Group’s short-term liquidity needs. The
Group is dependent on extension of the existing standstill agreements
until a long-term refinancing solution has been agreed.
The Group has routines to report cash flow forecasts on a regular basis
in order to monitor the Group's future cash position.
Capital structure and equity
The restructuring of the Group’s debt has been ongoing in 2021 and
standstill agreements have been agreed until the 30th of April 2022 with
95% of the secured lenders in the DOF Subsea Group. The BNDES facilities
in DOF Subsea Brasil Ltda. has been served according to refinancing
agreements signed in February 2020. The standstill agreements assume
payment of principal and interest of a NOK 100 million credit facility
provided by certain lenders in March 2020. The outstanding amount of
this facility was NOK 47 million by the end of the year.
The relevant Group companies have imposed unilateral standstill to
the secured lenders not participating in the standstill agreements. One
of the Group`s secured lenders has previously requested repayment of
a facility of USD 47 million, and in the 3rd quarter this facility was
prepaid at a significant discount. Another secured lender has enforced
an account pledge for one loan facility in the Group.
The bondholders in DOFSUB07, DOFSUB08 and DOFSUB09 have
accepted a standstill until the 30th of April 2022.
The DOFCON JV is not part of the standstill agreements and serves
its debt according to the terms in the relevant loan facilities. Financial
covenants related to DOF Subsea AS`s 50% guarantee of the DOFCON
loan facilities have been waived.
The Group’s financial position is not sustainable, and a long-term financial
solution is necessary to continue as going concern. Due to the ongoing
debt restructuring of the Group, the vast majority of the Group’s secured
and unsecured debt has in accordance with IFRS, been classified as current
debt as per 31st of December 2021. This classification is based on that
standstill agreements for debt service with the banks and bondholders
DOF Subsea Group Amounts in NOK million
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are less than 12 months. The Group is dependent on a robust refinancing
solution and the refinancing proposal currently discussed include a
comprehensive restructuring of the Group’s balance sheet which include
softer terms on the loan facilities and conversion of debt.
Under normal circumstances, the main objective when managing the
Group’s capital structure is to ensure that the Group is able to sustain
an acceptable credit rating and thereby achieve favorable terms and
conditions for long-term funding which is suitable for the Group’s
operation and growth. The Group manages its own capital structure and
carries out all necessary amendments to the capital structure, based on
continuous assessments of the economic conditions under which the
operations take place and the short and medium to long-term outlook.
Amounts in NOK million
2021 figures
Interest-bearing debt 9100
Interest-bearing assets non-current (sub-lease) 134
Restricted deposits 116
Cash 1 067
Net interest bearing debt 7 784
Total equity 2 594
Total equity and net debt 10 378
Debt ratio 75%
During the standstill period, the Group’s main financial covenants have
been waived. For further information, see note 19 ‘Interest bearing debt’.
3. Accounting estimates and assessments
Valuations, estimates and assumptions with a significant eect on the
financial statements are summarised below:
Debt to credit institutions and bondholders
Debt to credit institutions and bondholders have been presented as
current debt as result of not having a long-term financial solution in
place or waivers covering more than 12 months after balance sheet date.
Agreement on a new long-term financing solution or waiver of more
than 12 months duration, will result in changes in presentation of debt
to credit institutions and bondholders.
For further information about debt to credit institutions and bondholders,
see note 19 ‘Interest-bearing debt’.
Vessels
The carrying amount of the Group’s vessels represents 49% of the total
consolidated statement of financial position. Consequently, policies and
estimates linked to the vessel values have a significant impact on the
Group’s financial statements. Depreciation is calculated on a modified
straight-line basis over the estimated useful life of the asset. Depreciable
amount equals historical cost less residual value. Please see note 31
‘Accounting policies’ paragraph H, for information on tangible assets.
Useful life and climate risk
The depreciation of vessels depends on the vessels’ estimated useful
life in the Group. Useful life and economic life of the Groups vessels is
estimated to be 30 years. The Group has reassessed useful life of vessels
in 2021. From 01.01.2021 useful life of vessels in the Group has changed
from 20 years to 30 years. The residual value has been set to zero after
30 years as the cost of increasing environmental requirements related
to disposal of vessels are estimated to oset the scrap value of the steel.
Useful life and residual value of vessels is based on knowledge of the
market and years of operations of these types of vessels. In addition,
impact of climate risk has been considered when determining economic life.
The economic life of the vessels and the risk of stranded assets will
depend on the Group`s ability to reach the EU’s climate and energy
targets for 2030 and the objectives of the European green deal. A short
or longer economic life will in turn aect the value of the Group’s vessels
and equipment as well as future depreciation.
The Group’s vessel operations are the significant driver for the Group’s
climate footprint and the Group has for many years systematically
worked to reduce the total climate footprint. The Group`s overall goal
is to reduce emissions per operational day by 3% each year towards the
foreseeable future through various methods, using digital tools, deep
learning, machine learning, data collection, and further increasing the
competence and operational environmental awareness by the workforce.
The Group is adapting to the zero-mindset emission philosophy and is
on track to reach IMO requirements to reduce the Groups CO2 footprint
by 40% within 2030 compared to the starting point in 2008.
There will always be a risk that a change in regulation and the market’s
requirements for sustainable operation may aect the economic life of
the Groups vessels and in turn increase the risk of asset being stranded.
The Group has therefore established various projects that continuously
assess changes in climate risk and possible mitigating measures to
manage the climate risk and the risk of stranded assets.
DOF Subsea Group Amounts in NOK million
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Established strategies and the concrete plans are evaluated to be
sucient to mitigate the risk of stranded assts and to ensure economic
life of 30 years.
For more information about the Group`s projects and activities related
to emissions and energy reduction, see the Group’s Sustainability section.
Impairment of assets
Vessels
For the purposes of assessing impairment of vessels, assets are grouped
at the lowest levels for which there are separately identifiable cash flows
(cash-generating units, “CGU”). Each vessel together with associated
contracts is considered as a separate CGU.
Fair value less cost to sell
For vessels, fair value less cost to sell is based on an average of brokers’
estimates, taken into account sales commission. All vessels in the Group
are assessed by obtaining independent broker estimates. The brokers’
estimates are based on the principle of ’willing buyer and willing seller’.
Broker estimates include mounted equipment and assume that the vessels
are without any charter contracts (i.e. charter-free basis). The Group
adjusts for positive or negative contract value in associated contracts.
Due to a limited number of vessel transactions in the current market
the brokers’ estimates only to a limited extent represent the results of
transactions in the market. Because of this, the broker estimates are
more influenced by the judgement of each broker. For this reason, the
Group has sought to substantiate the broker valuations, inter alia with
value in use calculations or tests of reasonableness of implicit rates and
other assumptions derived from the valuations. The Group has deemed
it necessary to perform separate calculations for all vessels to support
the broker estimates.
Value in use
Estimated cash flows are based on next year’s budgets per vessel and
forecasted earnings going forward. The budget process is a detailed and
thorough bottom-up budgeting process at all levels of the organisation,
with approval procedures on all levels within the Group. Estimated
future cash flows are based on historical performance per vessel, in
combination with current market situation and future expectations.
Critical assumptions in the assessment are related to charter rates,
utilisation, operational and capital expenditure.
For vessels fixed on long-term contracts, the assumption is that the
contracts run up until end of contract. Options held by the customers
are not assumed to be exercised, unless the options are at or below
current market rates. For vessels without a contract, assumptions
derived from the evaluation of broker estimates, combined with other
market information are considered when estimating future revenues.
The Group has seen increased activity during 2021 and high tender
activity into 2022. It is however, too early to conclude on a market
revovery, hence, future earnings are dicult to forecast. The market is
expected to be weak for the next 1-2 years, and gradually normalised to
sustainable levels thereafter. Due to the current market situation, there
is a high level of uncertainty related to the estimates.
The Weighted Average Cost of Capital (WACC) is used as a discount rate
and reflects a normalised capital structure for the industry. The WACC
represents the rate of return the Group is expected to pay to its sources
of finance for cash flows with similar risks. Cash flows are calculated
after tax and discounted with an after-tax discount rate. The nominal
WACC used in the value in use calculations is 9.3%.
Sensitivity analysis and stress tests have been carried out for the main
variables in the assessment. This includes changes to key variables
such as broker estimates, operating revenue, operating expenses and
the discount rate.
ROVs
The ROVs are defined as interchangeable with each other and are therefore
identified as one CGU. Value in use calculation is performed for all ROVs
as a group and impairment will be recognised if the recoverable amount
from the value in use calculation for the whole group of ROVs is lower
than carrying amount of the group of ROVs. Principles for calculation
of future cash flows and WACC are the same as described for vessels.
Ta x
Changes in tax regimes may adversely aect the Group’s cash flows and
financial condition. Certain companies in the Group are subject to special
tax rules for ship owners in the Norwegian Taxation Act (§ 8-10 - § 8-20).
The Norwegian tonnage tax scheme is approved as legal state aid under
the EU guidelines for a 10-year period, from 1st of January 2018 until 31st
of December 2027. These tax rules stipulate certain requirements which
will have to be met. A failure to meet such requirements may have an
adverse eect on the eective tax rate of the Group. The Group is also
subject to transfer pricing regulations in various jurisdictions which might
impose the tax risk for the Group.
Deferred income tax is provided in full, using the liability method, on
temporary dierences arising between the tax bases of assets and liabilities
and their carrying amounts in the consolidated financial statements per IAS
12 ‘Income taxes’. Please refer to note 31 ‘Accounting policies’, paragraph P.
Deferred tax asset is recognised in the consolidated statement of financial
position on the basis of unused tax losses carried forward or deductible
temporary dierences to the extent that it is probable there will be
sucient future earnings available against which the loss carried forward
or deductible can be utilised. Continued challenging market situation, low
utilisation on vessels, equipment and personnel has resulted in lower
earnings and increased risk in some tax jurisdictions. In this context, there
is an inherent uncertainty in forecasting the amount, timing of future
taxable profits and the reversal of temporary dierences. As a result of
this, the Group has only to a limited extent recognised deferred tax assets.
For further information about deferred tax assets and tax loss carried
forward please refer to note 9 ‘Tax‘.
In general, attention and follow-up from tax authorities are increasing in
all tax jurisdictions. This should be seen in relation to OECD and G20
countries implementation of the Base Erosion and Profit Shifting (BEPS)
reporting requirements. The general trend is that each individual country
has become more concerned about protecting their tax base, and in this
context the Group experiences more tax audits in all countries where
the Group operates. Present tax claims and disputes are at period end in
an administrative or legal process with local tax authorities. Tax claims
are disputed, and the Group considers the risk of negative outcomes of
each individual tax claims to be lower than 50% and has therefore not
recognised any provision for each individual tax claim.
In total the Group has exposures due to ongoing tax audit of approximately
NOK 74 million at year-end 2021 compared to NOK 83 million in 2020.
The Group has operated in several new tax jurisdictions last couple of
years. In combination with increased focus from the tax authorities, the
total tax risk has increased. To mitigate the increased tax risk, the Group
has recognised a general tax provision of NOK 40 million. See note 9
‘Tax’ for further information about tax.
In 2014, the Brazilian Federal Revenue issued a Tax Assessment Notice
against DOF Subsea Brasil Ltda (the Company). Loans given by the
Parent Company to DOF Subsea Brasil Ltda were deemed to be taxable
revenue for the Company. The Tax Assessment Notice was disputed,
DOF Subsea Group Amounts in NOK million
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but on 7th of February, 2019, the court of first instance in Macae ruled
against the Company. Estimated amount of the claim is approximately
BRL 29.5 million (NOK 47 million) plus interest and charges. On
February 13, 2019, the Company filed a clarification appeal before the
same court. The Company intends to defend its position and considered
it to be more likely than not that the final verdict will conclude that
the loans received by the Company will not be reclassified as taxable
revenue. No provision related to the dispute is included in DOF Subsea
Group’s accounts as of 31st of December 2021. However, DOF Subsea
has provided security for the tax claim and the amount is included in
restricted cash. Outcome of such processes are uncertain and changes
in assumptions, interpretations and circumstances might result in future
cash outflow for the Group.
4. Segment information and Management
Reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-makers,
as defined in note 31 ‘Accounting policies’, paragraph C. The chief
operating decision-makers are responsible for allocating resources
and assessing performance of two operating segments: Subsea/IMR
Projects and Long-term Chartering.
The segment reporting below is presented according to internal management
reporting, based on the proportionate consolidation method of accounting
for joint ventures. The bridge between the management reporting and
the figures reported in the financial statements is presented below.
Please refer to note 28 ‘Investment in joint ventures and associates’
for further information on investments.
The Subsea/IMR Projects segment is the Group’s largest segment,
accounting for 71% of the Group’s total revenues for the period ended
31st of December 2021 (61% in 2020). From 1st of January 2021, Skandi
Acergy was transferred to the Subsea/ IMR segment. By year-end, the
Group operated 17 subsea vessels in the Subsea/IMR Projects segment,
of which 2 vessels was hired in from an external party. Within the
segment, the Group has been awarded several long-term contracts over
the last years, among others, the 7-year contract with Shell Philippines,
the 5-year contract with Shell Australia, the 3-year MSPV contract with
Esso in Australia, the 10- year contract with Husky Energy in Canada,
the 3-year diving contract with Petrobras, the 3-year MSPV contract for
Petrobras, and the 15-month PIDF project in Brazil.
Typical clients of the Group’s Long-term Chartering services are major
oil companies and subsea entrepreneurs.
In management reporting for 2021 DOF Subsea Group`s share of
impairment of vessel in the joint venture, NOK 98 million (NOK 121
million in 2020) has been recognised. In the joint venture company
DOFCON Navegacao Ltda, a hedging position in Brazilian Real that was
closed in 2017 in relation to conversion to functional currency USD,
implying a profit or loss eect (unrealised financial cost) of negative
NOK 30 million in 2021 (NOK 56 million in 2020). The correction does
not aect the company’s cash- or equity position.
The impairment and the hedging correction give a total negative eect
on the Group`s “Share of net income of joint ventures and associates”
with NOK 128 million (NOK 177 million in 2020). The negative eect
on NOK 128 million (NOK 177 million in 2020) is included in the
bridge between the management reporting and the financial statements.
Adjusted for these two eects, “Share of net income of joint ventures
and associates” in the consolidated statement of comprehensive income
had increased from NOK 296 million to NOK 424 (NOK 573 million to
NOK 750 million for 2020).
DOF Subsea Group Amounts in NOK million
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Management reporting Financial Statements
2021
Subsea/IMR
Projects
Long-term
Chartering Total
Reconciliation to
equity method Total
Operating revenue 3 943 1 602 5 545 -1 241 4 303
Operating profit before depreciation and impairment
(EBITDA)
816 1 192 2 087 -709 1 378
Depreciation and impairment -1 238 402 -837
Operating profit (EBIT) 848 -307 541
Net financial income / loss excl. unrealised net gain /
loss on derivative instruments and currency position
-611 187 -424
Unrealised net gain / loss on derivative instruments
and currency position
-36 47 11
Profit / loss before tax 201 -73 128
Tangible assets 5 059 2 177 7 226 - 7 226
Tangible assets jointly controlled companies - 5 853 5 853 -5 853 -
Total tangible assets 5 049 8 030 13 079 -5 853 7 226
2020
Subsea/IMR
Projects
Long-term
Chartering Total
Reconciliation to
equity method Total
Operating revenue 3 282 2 055 5 337 -1 352 3 984
Operating profit before depreciation and impairment
(EBITDA)
602 1 585 2 187 -526 1 661
Depreciation and impairment -3 271 350 -2 921
Operating profit (EBIT) -1 084 -176 -1 260
Net financial income / loss excl. unrealised net gain /
loss on derivative instruments and currency position
-1 392 296 -1 096
Unrealised net gain / loss on derivative instruments
and currency position
250 -6 244
Profit / loss before tax -2 226 115 -2 112
Tangible assets 4 770 2 926 7 696 - 7 696
Tangible assets jointly controlled companies
- 5 813 5 813 -5 813 -
Total tangible assets 4 770 8 739 13 509 -5 813 7 696
Consolidated statement of cash flows
31.12.2021
Consistent
with
management
reporting
Reconciliation to
equity method 31.12.2021
31.12.2020
Consistent with
management
reporting
Reconciliation to
equity method 31.12.2020
Net cash flow from operating activities 1 565 -861 704 1 705 -824 881
Cash flow from investing activities -615 463 -152 -194 306 112
Cash flow from financing activities -1 111 396 -715 -549 344 -205
Net change in cash and cash equivalents -161 -2 -163 961 -173 788
Cash and cash equivalents at the beginning of the
period 1 782 -452 1 330 1 238 -304 934
Exchange rate effect on cash and cash equivalents 30 -14 16 -417 25 -392
Cash and cash equivalents at the end of the period 1 651 -468 1 183 1 782 -452 1 330
DOF Subsea Group Amounts in NOK million
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5. Operating revenue
The Group's revenue from contracts with customers has been disaggregated and presented in the tables below:
Operating revenue Note 2021 2020
Lump sum contracts 117 337
Day rate contracts 4 187 3 647
Total operating revenue 4 303 3 984
Geographical distribution of
operating revenue 2021
Angola Norway Great Britain Brazil Australia Canada USA Other Total
Operating revenue 385 416 619 1 169 844 204 231 437 4 303
Geographical distribution of
operating revenue 2020
Angola Norway Great Britain Brazil Australia Canada USA Other Total
Operating revenue 148 729 951 559 382 297 264 653 3 984
Geographical distribution of revenue from contracts with customers is based on the location of clients. In 2021, one client accounted for more
than 10 % of the Group`s revenue.
In 2020 the Group received NOK 110 million in compensation for two cancelled contracts. The cancellation fee is included in total operating
revenue above.
The lease portion of revenue contracts are included in revenue from contracts with customers presented above. The right to use the vessel will
normally be within the range 30-80% of the total contract value. Please refer to note 3 ‘Accounting estimates and assessments’ and note 31
‘Accounting policies’, paragraph O, for information on revenue recognition.
6. Payroll expenses
Payroll expenses Note 2021 2020
Salary 26 -682 -627
Contract labor on vessels -528 -495
Employer’s contributions -111 -99
Pension costs -32 -32
Other personnel costs -42 -117
Total payroll expenses -1 395 -1 371
Full-time employees (at period end) 1 366 1 150
Pension costs above include defined benefit and defined contribution pension plans. The main part of the pension cost is related to the defined
contribution pension plan. Please refer to note 31 ‘Accounting policies’, paragraph Q, for information on employee benefits.
As of 31st of December 2020, the Group’s defined benefit pension plan covered a total of 49 employees and 6 people in retirement. From 01.01.2021
the Defined benefit pension sheme for oshore emplyees have been phased out.
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7. Other operating expenses
Other operating expenses 2021 2020
Short-term lease of vessels including crew expenses -189 -181
Technical costs -124 -123
Hired personnel -361 -224
Equipment cost -524 -394
Bunkers -155 -110
Administration cost -169 -172
Amortisation of contract cost -65 -27
Other operating expenses -318 -299
Total other operating expenses -1 905 -1 529
8. Financial income and expenses
Financial income and expenses Note 2021 2020
Interest income 25 17 25
Guarantee income from Joint Ventures 28 23 24
Interest income from sub-lease 11, 31.X 3 6
Gain on settlement of loan facility 19 249 -
Government support - debt forgiveness* 37 -
Other financial income 10 3
Financial income 339 58
Interest expenses -556 -525
Interest expenses on lease liability (right of use debt) 13 -15 -18
Interest expenses payable to DOF ASA companies 25 -7 -13
Other financial expenses -40 -133
Financial expenses -618 -690
Realised foreign currency net gain / loss on non-current debt and current debt -164 -19
Realised foreign currency net gain / loss on current receivables / liabilities -1 -345
Realised net gain / loss on foreign exchange derivatives 20 -101
Realised net gain / loss on derivative instruments and currency position -145 -465
Unrealised foreign currency net gain / loss on non-current debt and current debt -10 351
Unrealised foreign currency net gain / loss on current receivables / liabilities -7 -72
Net change in unrealised gain / loss on foreign exchange derivatives - 12
Net change in unrealised gain / loss on interest rate derivatives 28 -47
Unrealised net gain / loss on derivative instruments and currency position 11 244
Net financial income / loss -413 -852
*) The Group’s operations in the United States have qualified for loans granted as part of United States response and support in connection
with COVID-19. Total loan forgiven in 2021 is USD 4.3 million, equivalent to NOK 37 million. The eect of the debt forgiveness is presented as
financial income in 2021.
DOF Subsea Group Amounts in NOK million
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9. Tax
Income tax expense 2021 2020
Current tax on profits for the year -67 -51
Change in deferred tax 21 -52
Payable tax in Norway* - -22
Income tax expense -46 -126
The tax on the Group’s profit before tax diers from the theoretical amount, calculated by using domestic
tax rates applicable to profits of each subsidiary as follows:
Reconciliation of nominwal and effective tax rate 2021 2020
Profit / loss before tax 128 -2 112
Tax estimated by use of domestic tax rates applicable to profits in the respective countries* 5 277
Tax effect of:
Income/expenses not deductible for tax purposes -6 7
Tax effect of write down of financial assets - -11
Unrecognised tax losses and temporary differences -47 -495
Adjustments in respect to prior years -4 3
Withholding taxes and effect of different tax regimes -59 -40
Joint ventures and associates results reported net of tax 65 133
Income tax expense -46 -126
* Domestic tax rates applicable to the Group vary between 0% and 35%. Tax estimates exclude withholding taxes and other business taxes
Tax effect other comprehensive income 2021
Before tax Income tax After tax
Currency translation differences -37 1 -36
Share of other comprehensive income of joint ventures and associates 115 - 115
Other comprehensive income 78 1 79
Tax effect other comprehensive income 2020
Before tax Income tax After tax
Currency translation differences 25 - 25
Share of other comprehensive income of joint ventures and associates -47 - -47
Other comprehensive income 22 - 22
DOF Subsea Group Amounts in NOK million
The gross movement on the deferred tax in the statement of financial position 2021 2020
At 01.01 48 -4
Tax related to comprehensive income 21 -52
Tax related to components of other comprehensive income 1 -
At 31.12 26 48
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DOF Subsea Group Amounts in NOK million
Deferred tax
The table below specifies the temporary dierences between accounting and tax values, and the calculation of deferred tax/tax assets at period
end. The Group’s deferred tax assets are reviewed for impairment.
Basis for deferred tax
2021 2020
Non-current assets 80 -46
Current assets 28 -103
Liabilities -704 -807
Tax position related to sold assets 2 19
Other differences 13 7
Total temporary differences -582 -930
Temporary differences not included as deferred tax (+) 713 1 162
Total temporary differences included as deferred tax 131 231
Tax loss carried forward* -4 934 -4 736
Tax loss not included as deferred tax asset
4 934 4 736
Tax loss included as deferred tax assets (-) - -
Basis for calculating deferred tax / tax asset (-) 131 231
*Tax losses carried forward from subsidiaries taxed under the shipping tonnage tax regime are excluded.
Deferred tax / tax asset (-) calculated at domestic tax rates (17-35%)
26 48
Deferred tax (included in other non-current liabilities)
35 57
Deferred tax asset
-9 -9
Total deferred tax / tax asset (-) recognised in the statement of financial position 26 48
Tax-loss carried forward recognised as deferred tax asset per country
2021
Country
Tax-loss
carried forward
Temporary
differences Tax rate
Deferred tax
asset
Norway
- 161 22% 35
Australia
- -30 30% -9
Total - 131 26
2020
Country
Tax-loss
carried forward
Temporary
differences Tax rate
Deferred tax
/ Deferred tax
asset(-)
Norway
- 260 22% 57
Australia
- -29 30% -8
Total - 231 48
For information on current and deferred tax, please refer to note 31 ‘Accounting policies’, paragraph P.
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10. Earnings per share
Basis for calculating earnings per share 2021 2020
Profit / loss attributable to shareholders of the parent company 92 -2 187
Weighted average number of outstanding shares 167 352 762 167 352 762
Weighted average number of outstanding shares, diluted 167 352 762 167 352 762
Basic and diluted earnings per share (NOK) 0.55 -13.07
11. Tangible assets
2021 Vessels
Periodic
maintenance ROVs Operating equipments
Right-of-use
property Total
Cost at 01.01 12 720 1 111 1 750 806 320 16 707
Additions 73 273 101 23 1 472
Disposals -644 -68 -4 - - -715
Reallocation -9 - 4 7 - 2
Currency translation differences -7 -4 1 -1 - -11
Cost at 31.12 12 133 1 313 1 853 836 321 16 456
Depreciation at 01.01 -1 949 -848 -1 219 -527 -77 -4 620
Depreciation for the year -334 -128 -126 -42 -34 -665
Depreciation eliminated on disposals 84 59 2 - - 145
Reallocation - - - - - -
Currency translation differences -5 3 -1 1 1 -2
Depreciation at 31.12 -2 204 -915 -1 344 -568 -111 -5 142
Impairment at 01.01 -4 294 - -13 -57 -26 -4 390
Impairment for the year -202 - - - - -202
Reversal of impairment 30 - - - - 30
Impairment eliminated on disposals 476 - - - - 476
Currency translation differences - - - - - 1
Impairment at 31.12 -3 990 - -13 -57 -26 -4 086
Book value at 31.12 5 940 398 495 209 185 7 226
Lease assets included in book value 228 52 185 465
Asset lifetime (years) 30 2,5-5 12 5-15 5-30
Depreciation schedule Linear Linear Linear Linear Linear
DOF Subsea Group Amounts in NOK million
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2020 Vessels
Periodic
maintenance ROVs Operating equipments
Right-of-use
property Total
Cost at 01.01 12 879 1 031 1 740 977 294 16 920
Additions 8 111 11 15 28 174
Disposals - - - -2 -3 -6
Reallocation -34 - 14 -155 - -175
Currency translation differences -133 -30 -16 -29 1 -206
Cost at 31.12 12 720 1 111 1 750 806 320 16 707
Depreciation at 01.01 -1 894 -743 -1 077 -615 -42 -4 371
Depreciation for the year -90 -127 -157 -39 -36 -449
Depreciation eliminated on disposals - - - 1 1 2
Reallocation 14 - 1 103 - 117
Currency translation differences 21 21 14 23 1 80
Depreciation at 31.12 -1 949 -848 -1 219 -527 -77 -4 620
Impairment at 01.01 -1 923 - -14 -44 -26 -2 007
Impairment for the year -2 371 - - -15 - -2 385
Impairment eliminated on disposals - - - 1 - 1
Currency translation differences - - - - - 1
Impairment at 31.12 -4 294 - -13 -57 -26 -4 391
Book value at 31.12 6 478 263 517 221 217 7 696
Lease assets included in book value 232 59 217 509
Asset lifetime (years) 20 2.5-5 12 5-15 5-30
Depreciation schedule *) Linear Linear Linear Linear Linear
*) Residual value varies based on market valuation of the vessel
Useful life and residual value
The Group has reassessed useful life of vessels from 20 years to 30 years with eect from 01.01.2021. The residual value has been set to zero
after 30 years. In 2020, the residual value was determined based on estimated fair value after 20 years. The change in useful life and residual
value have in total increased annually depreciations.
Disposal
The vessel Geosund has been delivered to new owners in January 2022. The vessel is per Q3 derecognised from tangible asset and classified as
financial lease. In addition Geograph was sold in the 2nd quarter 2021. Total gain on sale of tangible assets in 2021 amounts to NOK 78 million.
Finance leases of tangible assets
The Group’s assets held under finance leases include several ROVs. For further information on these, please refer to note 13 ‘Leases’ and note
31 ‘Accounting policies’, paragraph H and I.
DOF Subsea Group Amounts in NOK million
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DOF Subsea Group Amounts in NOK million
Impairment
Impairments in 2021 with NOK 172 million includes reversal of earlier impairments with NOK 30 million related to Skandi Neptune. The Group
has signed a sales agreement for delivery of the vessel in Q3 2022.
The drop in fair market values has stabilised for the majority of the fleet in 2021. The market conditions are expected to remain challenging, and
the timing of market recovery remains uncertain. A continuing weak market and high volatility in currencies may increase the risk for further
impairment of the Group`s assets going forward.
There are signs of improved markets in several regions and increased demand for oshore vessels within the oshore wind segment. It is however
still too early to conclude on a market recovery. Hence, future earnings and asset values are dicult to forecast. A continuing weak market will
further increase the risk of lower earnings for the Group and put more pressure on the Group`s liquidity position. If a robust long- term refinancing
solution is not achieved and the Group cannot be treated as a going concern, the valuation of the Group`s assets may be further revised and will
result in significantly impairments of the Group`s assets.
Vessel Impairment Basis for recoverable amount Segment Measurement level
Geoholm -5 Fair value less cost of disposal Subsea / IMR Projects 3
Geosund -16 Fair value less cost of disposal Subsea / IMR Projects 3
Skandi Carla -17 Fair value less cost of disposal Subsea / IMR Projects 3
Skandi Neptune 30 Fair value less cost of disposal Subsea / IMR Projects 3
Skandi Patagonia -65 Fair value less cost of disposal Long-term Chartering 3
Skandi Hawk -21 Value in use Subsea / IMR Projects 3
Skandi Constructor -16 Value in use Subsea / IMR Projects 3
Skandi Africa -63 Fair value less cost of disposal Long-term Chartering 3
Total impairment -172
Total book value of impaired vessels 2 967
2020
Vessel Impairment Basis for recoverable amount Segment Measurement level
Geograph -45 Fair value less cost of disposal Subsea / IMR Projects 3
Geoholm -109 Value in use Subsea / IMR Projects 3
Geosund -49 Value in use Subsea / IMR Projects 3
Skandi Acergy -273 Value in use Long-term Chartering 3
Skandi Achiever -249 Value in use Subsea / IMR Projects 3
Skandi Carla -78 Value in use Subsea / IMR Projects 3
Skandi Hercules -158 Value in use Subsea / IMR Projects 3
Skandi Neptune -168 Value in use Subsea / IMR Projects 3
Skandi Patagonia -97 Value in use Long-term Chartering 3
Skandi Seven -187 Value in use Subsea / IMR Projects 3
Skandi Singapore -256 Value in use Subsea / IMR Projects 3
Skandi Skansen -170 Value in use Subsea / IMR Projects 3
Skandi Hawk -144 Value in use Subsea / IMR Projects 3
Skandi Constructor -259 Value in use Subsea / IMR Projects 3
Skandi Africa -127 Value in use Long-term Chartering 3
Skandi Vinland -3 Value in use Subsea / IMR Projects 3
Total impairment to Vessels -2 371
Total book value of impaired vessels 6 328
Depreciation and impairment Note 2021 2020
Depreciation tangible asset -665 -449
Impairment tangible asset -202 -2 385
Reversal of impairment 30 -
Impairment Goodwill - -85
Depreciation and impairment -837 -2 921
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Sensitivity analysis of impairment
Impairment tests are highly USD sensitive and a drop in USD/NOK of NOK 0.5 will result in an additional impairment of NOK 91 million, given
no change in other assumptions. While testing the reasonableness of the broker estimates the Group has applied a nominal WACC after tax of
9.3 %. An increase in WACC by 50 basis points will result in an additional impairment of the vessels of NOK 13 million. Negative eect on net
future cash flows with 20% will result in an additional impairment of the vessels with NOK 682 million. Sensitivity analyses for vessels owned
by the joint venture DOFCON Brasil are discussed in note 28 ‘Investment in joint ventures and assosiates’.
The Group has a new fleet of vessels and as a result, the future cash flows for the vessels are long. The key assumptions in a discounted cash flow
calculation for vessels are utilisation and charter rates. Changes in these assumptions could have considerable eects on the value of the vessels.
12. Contract cost
31.12.2021 2021 2020
Net booked value 01.01 51 -
Additions 102 45
Reclassification from tangible assets -4 35
Amortisation -65 -27
Currency translation differences - -2
Net booked value 31.12 84 51
The Group has presented and recognised contract cost as intangible asset in accordance with policies described in note 31 ‘Accounting policies’,
paragraph O. The main part of the contract costs is related to mobilisation of vessels, equipment and oshore personnel.
Amortisation of contract costs are recognised over the contract period of the related contract as other operating expenses.
13. Leases
Operating lease income - the Group as lessor
DOF Subsea Group acts as a lessor in connection to operating leases. The leases relates to the time charter and bareboat contracts on vessels and
equipment in the Long-term Chartering segment. For time charter contracts both the lease component and service component are included in the
overview of future minimum lease revenue. Vessels on operating lease are recognised as tangible assets, see note 11 ‘Tangible assets’. Lease payments
received are recognised in the statement of comprehensive income. Future minimum operating lease income arising from contracts on vessels at
period end is shown in overview below. All contracts in foreign currency are converted to NOK using the exchange rate at 31st of December 2021.
Overview of future minimum lease revenue Within 1 year 2-5 years After 5 years Total
Minimum operating lease income amounts falling due in the periods 301 385 - 685
Minimum operating lease income amounts falling due in the periods including
joint ventures
1 814 4 488 32 6 334
Total future minimum operating lease income from contracts is NOK 685 million (NOK 1,007 million).
Total future minimum operating lease income including joint ventures from contracts is NOK 6,334 million (NOK 7,901 million).
Please refer to note 31 ‘Accounting policies’, paragraph I, for further information on operating leases.
DOF Subsea Group Amounts in NOK million
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Leases of tangible assets - the Group as lessee
The Group leases mainly vessels ROVs, warehouses and oce buildings. The bareboat contract of Skandi Darwin is classified and presented as
a sub-lease. In addition, the vessel Geosund has been agreed sold and is derecognised as tangible asset and classified and presented as a sub-
lease in 2021.
Amounts recognised in the statement of financial position;
2021 2020
Tangible assets - ROVs and operating equipment 280 291
Tangible assets - right-of-use property 185 217
Total tangible assets 465 509
Non-current receivables sub-lease 7 52
Current receivable sub-lease 128 -
Total assets 599 561
Non-current debt to credit institution for lease of ROVs - -
Current debt to credit institution for lease of ROVs 132 161
Non-current lease - right of use property 196 272
Current lease - right of use property 78 83
Total liabilities 406 515
On long-term contracts for lease of ROVs with low residual value, the Group has assumed an expectation of purchase of the asset. Other contracts
are presented as right-of-use assets and is mainly related to lease of property. Please refer to note 11 ‘Tangible assets’ for further information of the
eect on tangible assets. The lease debt for ROVs, where the Group assume to purchase the assets, is presented as part of debt to credit institution.
Debt related to right-of-use assets and sub-lease is presented as lease debt. Please refer to note 19 ‘Interest-bearing debt’ for further information
on lease debt.
Amounts recognised in statement of comprehensive income;
2021 2020
Short-term lease expenses of vessels including crew related cost -189 -181
Depreciation ROVs and operating equipment -38 -51
Depreciation right of use property -34 -36
Total depreciation and impairement -71 -87
Interest income 3 6
Interest expenses -15 -18
Net financial income / loss -12 -13
Total expenses in statement of comprehensiv income -272 -281
Financial lease 2021 2020
Cost at 01.01. 761 974
Additions 63 30
Disposals -58 -243
Currency translation differences - 1
Cost at 31.12. 766 761
Depreciation at 01.01. -223 -255
Depreciation for the year -71 -87
Depreciation disposals 22 119
Currency translation differences 1 -
Depreciation at 31.12. -272 -222
Impairment 01.01 -30 -30
Impairment for the year - -
Impairment 31.12 -30 -30
Book value at 31.12 465 509
Leased assets that are purchased from the Group after the end of the lease period are included in disposals.
DOF Subsea Group Amounts in NOK million
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DOF Subsea Group Amounts in NOK million
14. Non-current assets
Non-current assets Note 2021 2020
Non-current receivables from DOF ASA companies 25 45 70
Non-current receivables from joint ventures and associated companies 25 - 107
Derivative financial instruments 22 - -
Contract cost 12 84 51
Other non-current receivables 24 36
Non-current receivables sub-lease 13 7 52
Provision for bad non-current receivables 25 -45 -70
Total non-current assets at 31.12 114 246
For further information about lease liability, see note 19 ’Interest-bearing debt’. A provision of NOK 45 million is related to non-current receivable
from DOF ASA companies.
15. Trade receivables
Trade receivables 2021 2020
Trade receivables at nominal value 593 509
Contract assets 388 151
Allowance for expected credit losses -6 -32
Total trade receivables 975 628
Currency specification at 31.12.2021 AUD USD BRL NOK CAD Other Total
Trade receivables 116 497 230 27 74 32 975
Aging profile and credit risk at 31.12.2021 Total
Not
matured < 30 d 30-60 d 60-90 d >90 d
Trade receivables at nominal value
593 516 32 7 13 25
Expected credit loss rate
0.2% 2.5% 3.0% 7.0% 12.0%
Loss allowance trade receivables
6 1 1 - 1 3
Loss allowance specific contract
-
Contract asset 388
Expected credit loss rate
0.2%
Loss allowance contract asset
- 1
Total expected loss allowance
6
Currency specification at 31.12.2020 AUD USD BRL NOK GBP Other Total
Trade receivables 225 160 94 74 55 20 628
Aging profile and credit risk at 31.12.2020 Total
Not
matured < 30 d 30-60 d 60-90 d >90 d
Trade receivables at nominal value
509 386 39 37 1 46
Expected credit loss rate
0.2% 2.5% 3.0% 7.0% 12.0%
Loss allowance trade receivables
4 1 1 1 - 2
Loss allowance specific contract
28 28
Contract asset 151
Expected credit loss rate
0.2%
Loss allowance contract asset
- -
Total expected loss allowance 32
The majority of the Group’s trade receivables are to major international energy companies and subsea entrepreneurs. Historically the Group
has had insignificant losses on trade receivables. Within the Subsea/IMR Projects segment, payment milestones in the contracts and variation
orders impact the cash collection for the Group and potentially lead to short-term fluctuations in trade receivables. An impairment analysis is
performed at each reporting period to measure expected credit losses. The contract asset and trade receivables have substantially the same
risk characteristics and the same loss rates has been used for calculation of loss allowance. General allowance for expected credit losses 31st
of December 2021 and 31st of December 2020 has been based on historical losses and updated view on general risk in the Group`s industry.
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For further information about credit risk see note 2 ‘Financial risk management’. For further information on trade receivables, please see note
31 ‘Accounting policies’, paragraph G.
16. Other current assets
Other current assets Note 2021 2020
Receivables from DOF ASA companies 25 128 71
Receivables from joint ventures 25 126 222
Government taxes receivable (VAT) -1 39
Prepaid expenses 67 47
Insurance claims 2 5
Fuel reserves and other inventory 56 49
Sub lease asset 128 45
Other current assets -1 6
Total other current receivables at 31.12 503 485
17. Cash and cash equivalents
Cash and cash equivalents 2021 2020
Total restricted cash 578 264
Restricted cash serving as security for loans -462 -145
Restricted cash net 116 118
Unrestricted cash and cash equivalents 1 067 1 212
Total cash and cash equivalents at 31.12 1 183 1 330
Restricted cash consists of cash only available for specific purposes. A portion of this cash serves as security for outstanding debt following
enforcements of account pledges. The balance of these accounts sums up to NOK 462 million. Some lenders have exercised their right to set o
such cash balances toward the outstanding loans. The Group has therefore chosen to present all restricted cash serving as security for loans,
net of debt to credit institutions.
The Group has an administrative cash pooling arrangement whereby cash surpluses and overdrafts residing in the Group companies bank accounts
are pooled together to create a net surplus. Liquidity is made available through the cash pooling for the companies in the Group to meet their
obligations. The bank accounts in the cash pool consists of accounts in various currencies. The total cash pool cannot be overdrafted. The cash
pool is presented as unrestricted cash and cash equivalents.
Surplus cash transferred to the Group’s cash pool will be available at all times to meet the Group’s financial obligations at any time. Some
subsidiaries are not part of the cash pool. Surplus cash in these companies is not immediately available for the rest of the Group. The main part
of this is the DOF Installer ASA unrestricted cash balance of NOK 563 million.
For further information about market-, credit- and liquidity risk see note 2 ‘Financial risk management’.
2021 2020
Group cash pool
Amount in
currency Book value
Amount in
currency Book value
NOK 38 38 133 133
USD 11 95 5 43
GBP 3 31 - 1
EUR - 2 1 12
CAD 1 5 4 24
AUD 2 13 - -
Net Group cash pool 184 212
DOF Subsea Group Amounts in NOK million
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DOF Subsea Group Amounts in NOK million
18. Share capital and share information
Share capital
The share capital in DOF Subsea AS was NOK 1674 million comprising 167 352 762 shares, each with a nominal value of NOK 10.00.
Shareholder overview
Shareholders at 31.12.2021 No. of shares Proportion of ownership Share capital
Board of Directors Title
Hans Olav Lindal Chairman
Helge Singelstad Director
Kathryn M. Baker Director
Marianne Møgster Director
Harald Lauritz Thorstein Director
Executives Title
Mons S. Aase CEO
Martin Lundberg CFO
The Company is a part of DOF ASA. Please refer to the DOF A SA annual report for shares held in DOF ASA by the management and the Board
of Directors. The annual report is published at www.dof.no.
19. Interest-bearing debt
The Board and Management have, since the second quarter of 2019, been working on a long-term refinancing solution for the Group which
includes discussions with secured lenders and the bondholders.
The restructuring of the Group’s debt has been ongoing in 2021 and standstill agreements have been agreed until the 30th of April 2022 with
95% of the secured lenders in the DOF Subsea Group. The BNDES facilities in DOF Subsea Brasil Ltda. has been served according to refinancing
agreements signed in February 2020. The standstill agreements assume payment of principal and interest of a NOK 100 million credit facility
provided by certain lenders in March 2020. The outstanding amount of this facility was NOK 47 million by the end of the year.
The relevant Group companies have imposed unilateral standstill to the secured lenders not participating in the standstill agreements. One of
the DOF Subsea secured lenders has previously requested repayment of a facility of USD 47 million, and in the 3rd quarter this facility was
prepaid at a significant discount. Another secured lender has enforced an account pledge for one loan facility in DOF Subsea.
The bondholders in DOFSUB07, DOFSUB08 and DOFSUB09 have accepted a standstill until the 30th of April 2022.
The DOFCON JV is not part of the standstill agreements and serves its debt according to the terms in the relevant loan facilities. Financial
covenants related to the Group’s 50% guarantee of the DOFCON loan facilities have been waived.
The Group will continue the dialogue with its creditors to secure a long-term financial solution for the Group. Various debt restructuring
proposals have been discussed and the proposals include comprehensive restructuring of the Group’s balance sheet, including conversion of debt.
The Group’s secured- and unsecured debt are, in accordance with IFRS, classified as current debt at the 31st of December 2021. This classification
is based on the Group`s financial situation and standstill agreements of debt service with the banks and bondholders.
Restructuring costs related to advisory and legal fees amounts to NOK 45 million in 2021 and are included in the financial costs in the result.
For further information on interest-bearing debt and potential eect on going concern assumption, please refer to note 30 ‘Events occurring
after period end’ and note 1 ‘Corporate information and going concern’.
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DOF Subsea Group Amounts in NOK million
Non-current interest-bearing debt 2021 2020
Bond loans - -
Debt to credit institutions - -
Lease liabilities 196 272
Total non-current interest-bearing debt 196 272
Current interest-bearing debt
Bond loans 2 979 2 554
Debt to credit institutions 5 847 6 326
Lease liabilities 78 83
Total current interest-bearing debt 8 904 8 963
Total non-current and current interest-bearing debt 9100 9 234
Net interest-bearing debt
Cash and cash equivalent 1 330
Other interest-bearing assets 134 97
Total net interest-bearing debt 7 784 7 807
1 183
Current portion of debt in the statement of financial position includes accrued interest expenses. Accrued interest expenses are excluded in the
current interest-bearing debt above.
Cash and non-cash changes in total borrowings
Changes in total borrowings over a period consists of both cash eects (disbursements and repayments) and non-cash eects (amortisations and
currency translation eects). The following is the changes in the Group’s borrowings:
2021 Cash changes Non-cash changes
Interest bearing debt
Balance
31.12.20
Netting of
restricted cash Cash flows
Debt
forgivness
Capitalisation
of interest and
other changes
Proceed
lease debt
Amortised
loan
expense
Currency
adjustment
Balance
31.12.21
Bond loans
2 554 - - - 379 - 5 41 2 979
Debt to credit
institutions
6 326 -315 -323 -249 237 35 6 131 5 847
Lease liabilities
354 - -78 - - 1 - -3 274
Total interest bearing debt
9 234 -315 -400 -249 616 36 11 169 9 100
2020 Cash changes Non-cash changes
Interest bearing debt
Balance
31.12.19
Netting of
restricted
cash Cash flow
Debt
forgivness
Capitalisation
of interest and
other changes
Proceed
lease debt
Amortised
loan
expense
Currency
adjustment
Balance
31.12.20
Bond loans
2 590 - - - - - 1 -36 2 554
Debt to credit
institutions
6 673 -146 21 - 137 - 6 -363 6326
Lease liabilities
404 - -80 - - 28 - 2 354
Total interest bearing debt
9 667 -146 -59 - 137 28 7 -397 9 234
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Lease debt
The table below summarises the repayment profile of leases;
Lease debt
2022 2023 2024 2025 2026 Subsequent Total
Lease liabilities - related to ROV equipment 132 132
Lease liabilities - right-of-use asset and sub-lease 78 36 30 30 28 71 274
Total 210 36 30 30 28 71 406
Lease repayment profile for the lease debt above is exluded interest payments. Interest on lease liabilities in table above is
measured at the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing rate. The
weighted average lessee’s incremental borrowing rate applied to the lease liabilities presented are in the range of 4%-6%.
Liabilities secured by mortgage 2021 2020
Liabilities to credit institutions, incl. leases 5 562 5 987
Book value of assets pledged as security* 6 852 7 393
Average rate of interest 6.37% 5.51%
*) for some of the vessels receivables are pledged as security
Currency distribution current and non-
current liabilities 31.12.2021 31.12.2020
Currency NOK Ratio Currency NOK Ratio
USD 610 5 382 59% 650 5 548 60%
NOK 3 278 3 278 36% 2 965 3 298 36%
CAD 60 413 5% 58 388 4%
GBP 2 27 0% 0%
Total 9 100 100% 9 234 100%
Debt to credit institutions in USD, CAD and GBP are revaluated to NOK using exchange rate at period end. After the balance sheet date, NOK
loans of 1,329 million and the CAD loan amounted to NOK 413 million are converted to USD.
The estimated fair values of the Group’s bond loans at period end, based on last transactions registered, were as follows:
31.12.2021 31.12.2020
Loan Due date*)
Coupon
rate Price **)
Outstanding
amount***)
Initial
value Price **)
Outstanding
amount***)
Initial
value
DOFSUB07 31.03.2021 7.52% 20.25 467 1 300 20.25 467 1 300
DOFSUB08 14.03.2022 9.50% 20.25 1 297 1 539 20.25 1 255 1 489
DOFSUB09 27.11.2023 8.81% 25.00 840 900 25.00 840 900
Capitalised interest 379
Amortisation cost -4 -9
Total 2 979 3 739 2 554 3 689
Fair values of bonds are based on last transaction done and registered at Oslo Børs.
*) DOFSUB07 and DOFSUB08 due date has been extended to end of the standstill period.
**) Price at par price is the latest turnover done in 2020, due to the ongoing refinancing no turnover is recognised in 2021.
***) The outstanding amount on each bonds are lower than initial amount, due to own bonds.
The fair value of the bond loans are estimated to NOK 644 million. The amounts include fair value on capitalised interest based on the latest
turnover done on the loans.
The trustee on behalf of the bondholders is Nordic Trustee ASA. Interest rates are both floating and fixed. No particular security has been provided
for the loans, and the Group is free to acquire its own bonds.
Financial covenants
As part of the current standstill agreements the following covenants have been waived (based on the proportionate consolidation method of
DOF Subsea Group Amounts in NOK million
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accounting for joint ventures):
The Group shall have available cash of at least NOK 500 million at all times
The Group shall have value-adjusted equity to value-adjusted assets of at least 30%
The Group shall have book equity of at least NOK 3,000 million at all times
The Group shall have positive working capital at all times, excl. current portion of debt to credit institutions
The fair value of the Group’s vessels shall always be at least 110-130% of the outstanding loan amount
In addition to the above-mentioned financial covenants, the loan agreements are also subject to the following conditions:
The Group’s assets shall be fully insured
There shall not be any change of classification, flag, management or ownership of the vessels without the prior written approval of the lenders
DOF ASA shall be the principal shareholder in DOF Subsea AS, and own a minimum of 50.1% of the shares
DOF Subsea AS shall not merge, demerge or divest activities without the prior written approval of the lenders
DOF Subsea AS shall report financial information to the lenders and Oslo Stock Exchange on a regular basis
The Group’s vessels shall be operated in accordance with applicable laws and regulations
The Group has further received waiver for the financial covenants as guarantor for two facilities in the joint venture with TechnipFMC.
If waivers are not extended, it is a significant risk that the Group will be in breach of its covenants.
20. Trade payables
Currency specification at 31.12.2021 NOK AUD BRL GBP USD Other Total
Trade payables 139 63 89 47 132 26 496
Currency specification at 31.12.2020 NOK AUD BRL GBP USD Other Total
Trade payables 64 24 43 48 164 41 385
21. Other current liabilities
Other current liabilities Note 2021 2020
Current liabilities to DOF ASA companies 25 170 128
Tax payables 9 68 80
Public duties payables 31 20
Prepayment from customers 2 3
Financial current derivatives 22 6 35
Other current liabilities 109 134
Total other current liabilities at 31.12 385 400
22. Hedging activities
The following table displays the fair value of financial derivatives as of 31st of December:
2021 2020
Non-current and current portion Measurement level Assets Liabilities Assets Liabilities
Interest rate swaps 2 - 6 - 35
Foreign exchange contracts 2 - - - -
Total non-current and current portion - 6 - 35
Non-current portion
Interest rate swaps 2 - - - -
Foreign exchange contracts 2 - - - -
Total non-current portion - - - -
Total current portion - 6 - 35
DOF Subsea Group Amounts in NOK million
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DOF Subsea Group Amounts in NOK million
For further information on derivative financial instruments, please see note 31 ‘Accounting policies’, paragraph S.
For those financial and tangible assets and liabilities, which have been recognised at fair value in the Consolidated Statements of Financial Position,
the measurement hierarchy and valuation methods described below have been applied. There have been no transfers between fair value levels.
Measurement level 1 (Quoted, unadjusted prices in active markets for identical assets and liabilities). Not in use for any assets or liabilities.
Measurement level 2 (Techniques for which all inputs which have significant eect on the recorded fair value are observable, directly and indirectly)
The fair value of forward exchange contracts is determined using the forward exchange rate at the end of the reporting period. The forward
exchange rate is based on the relevant currency’s interest rate curves. The fair value of interest swaps is determined by the present value of
future cash flows, which is also dependent on the interest curves.
Measurement level 3 (Techniques which use inputs which have significant eect on the recorded fair value that are not based on observable
market data).
The fair value of the Group’s assets are assessed by obtaining independent quarterly broker estimates from recognised brokers within the
industry. Net sales value is calculated based on an average of the brokers’ values, taken into account sales commission and adjusted for for any
excess values in the firm existing contracts.
As of 31.12 the Group held the following interest rate derivatives, not qualified for hedge accounting:
Instruments Fixed rate Floating rate Notional amount Effective from Maturity date
31.12.2021
Interest rate swaps - NOK 1.68%-1.92% NIBOR 3m 1 000 2018 2023
31.12.2020
Interest rate swaps - NOK 0.85%-1.92% NIBOR 3-6m 1 750 2016-2018 2021-2023
23. Financial assets and liabilities: information on the balance sheet
The tables below give an overview of the carrying value of the Group’s financial instruments and the accounting treatment of these instruments.
The table is the basis for further information regarding the Group’s financial risk.
31.12.2021 Note
Financial instruments
at fair value through
profit and loss
Financial instruments
measured at
amortised cost Total
Of which included
net in interest
bearing debt
Assets
Non-current derivatives 22 - - - -
Other non-current receivables 14,19 - 31 31 7
Trade receivables and other current assets 15,16,19 - 1 355 1 355 128
Current derivatives 22 - - - -
Restricted deposits 17,19 - 116 116 116
Unrestricted cash 17,19 - 1 067 1 067 1 067
Total financial assets - 2 568 2 568 1 317
Liabilities
Derivatives non-current
22 - - - -
Interest-bearing non-current liabilities
19 - 196 196 196
Current portion of debt
19 - 9 104 9 104 8 904
Other non-current liabilities
- 2 2 -
Current derivatives
22 6 - 6 -
Trade payables and other current liabilities
20,21 - 774 774 -
Total financial liabilities 6 10 076 10 083 9 101
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31.12.2020 Note
Financial instruments
at fair value through
profit and loss
Financial instruments
measured at
amortised cost Total
Of which included
in net interest
bearing debt
Assets
Non-current derivatives 22 - - - -
Other non-current receivables 14, 19 - 195 195 52
Trade receivables and other current assets 15, 16, 19 - 972 972 45
Current derivatives 22 - - - -
Restricted deposits 17, 19 - 118 118 118
Unrestricted cash 17, 19 - 1 212 1 212 1 212
Total financial assets - 2 497 2 497 1 427
Liabilities
Derivatives non-current
22 - - - -
Interest-bearing non-current liabilities
19 - 272 272 272
Current portion of debt
19 - 9 258 9 258 8 963
Other non-current liabilities
- 2 2 -
Current derivatives
22 35 - 35 -
Trade payables and other current liabilities
20, 21 - 647 647 -
Total financial liabilities 35 10 178 10 213 9 234
Prepayments and non-financial liabilities are excluded from the disclosures above. The following of the Group’s financial instruments are measured
at amortised cost: cash and cash equivalents, trade receivables, other current receivables, overdraft facilities and all interest bearing debt.
The carrying amount of cash and cash equivalents and overdraft facilities is approximately equal to fair value since these instruments have a
short term to maturity. Similarly, the carrying amount of trade receivables, trade payables and other working capital items are approximately
equal to fair value since they are entered into at standard terms and conditions. The fair value of the interest-bearing debt is not possible to
esimate due to the ongoing refinancing in the Group. In 2021 DOF Subsea Group has repaid one debt facility with an discount of 64%.
The fair value of the bond loans are estimated to NOK 644 million, based on the lastest turnover which was in 2020. Due to the ongoing refinancing
process it is not recognised any turnover in 2021. For further information on financial instruments, please refer to note 31 ‘Accounting policies’,
paragraph S and note 19 ‘Interest-bearing debt’.
24. Guarantees
The Group has commitments to clients to ensure performance under contracts. These commitments are mainly parent company guarantees or
counter guarantees given to banks for the issuance of bank guarantees and performance bonds. The guarantees are limited to fulfilment of the
contract and are released after fulfilment of the contract obligation. In some cases, this is followed by a warranty period. Normally this warranty
period will have duration of 12-24 months and will only be for a portion of the initial guarantee amount.
The Group has guarantee commitments on behalf of DOFCON Brasil Group in favor of credit institutions of USD 345 million as per 31.12.2021.
Furthermore, guarantees are given to suppliers for fulfilment of payment for deliveries of goods and services.
25. Related parties
Description of related parties and the DOF Subsea Group’s relationship to these:
DOF ASA is the sole shareholder in DOF Subsea AS with a 100% holding on 31st of December 2021.
DOF ASA controls companies which hire vessels and deliver goods and services to companies in the Group. Furthermore, the Group has contracts
covering leasing of assets and delivering of services to DOF ASA companies. All related parties transactions and contracts are subject to standard
terms and Group policies.
DOF Subsea Group Amounts in NOK million
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DOF Subsea Group Amounts in NOK million
Operating expenses to DOF ASA companies 2021 2020
Vessel hire 61 25
Crew and other personnel hire 373 325
Vessel technical costs 19 22
Management fee vessels 70 69
Other management services and IT costs 47 53
Total 570 494
Vessel hire
The Group hires vessels from and to DOF ASA companies based on the demand in the market and available tonnage.
Skandi Iceman was hired from DOF ASA companies during the year.
Hire of ROV equipment and services
Some of the Group’s ROVs are hired by DOF ASA companies. The ROVs are operated by DOF Subsea personnel.
Crew and other personnel hire
The Group hires marine crew from DOF ASA companies and external parties.
Vessel technical costs
Vessel technical costs are purchases done by DOF ASA companies on behalf of DOF Subsea Group.
Operating revenue from DOF ASA companies 2021 2020
Vessel hire 231 147
Hire of ROV equipment and services 92 89
Other revenue 78 66
Total 400 302
Management fee vessels
The Group purchases management services from DOF Management AS, DOF Management Pte Ltd and Norskan Oshore Ltda. for its entire
fleet of owned vessels. The management fee during the year varied from NOK 800 thousands till NOK 5 million (NOK 800 thousands till NOK
5 million 2020) per vessel.
Other management services and IT costs
Marin IT delivers IT services to the Group. Other management services (income and expenses) will include transactions such as hire of onshore
sta, rental of oce space and other reimbursable expenses invoiced from or to DOF ASA companies.
Other financial expenses between DOF ASA and the Group
The Group has in June 2010 entered into a guarantee agreement with DOF ASA. DOF ASA has provided a parent company guarantee for
obligations of DOF Subsea Brasil Serviços Ltda. and DOFCON Navegação Ltda. The basis for guarantee fee to DOF ASA amounts to USD 111
million at year-end (USD 119 million as of 31st of December 2020).
The refinancing process is a common process for the Group and DOF ASA. Costs related to the refinancing process are allocated to dierent
companies in the groups based on agreements with the parties. All refinancing costs are classified and presented as external expenses.
Financial income and expenses from/to DOF ASA companies 2021 2020
Interest income 1 3
Impairment of non-current receivables 3 -48
Guarantee fees expenses 4 10
Balances arising from sales / purchases of goods / services and loans related to DOF ASA companies Note 2021 2020
Current receivables 16 128 71
Current liabilities 21 170 128
Loans to DOF ASA companies Note 2021 2020
Non-current receivables 14 45 70
Impairment of non-current receivables 14 -45 -70
For further information related to DOF ASA, see financial statements for DOF ASA.
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DOF Subsea Group Amounts in NOK million
Financial income and expenses from/to joint ventures Note 2021 2020
Interest income 8 6 16
Guarantee income 8 23 24
Loans to joint ventures Note 2021 2020
Other non-current receivables from joint ventures 14 - 107
Other current receivables from joint ventures 16 126 222
DOF Subsea AS has provided parent company guarantees for 50% of the loan obligations for the vessels owned in the joint venture. For further
information see note 24 ‘Guarantees’ and note 28 ‘Investment in joint venture and associates’.
26. Remuneration to Board of Directors, Executives and Auditor
2021 2020
Remuneration to Executives CEO CFO CEO EVP
Salaries - 1.9 - 6.4
Management fee 3.5 - 4.9 -
Payment from DOF Subsea 3.5 1.9 4.9 6.4
CEO = Mons Aase, EVP = Jan Nore, CFO = Martin Lundberg
Cost related to board fee to member of the board amounts to NOK 75,000.
In addition, the chairman Hans Olav Lindal has invoiced for hour spend in total NOK 864,675 is expensed in 2021.
Salaries include pension, bonuses and “other compensations” from the Group.
For additional information on employee benefits, please refer to note 31 “accounting policies”, paragraph Q.
A severance settlement for the agreed termination of the former CFO/EVP in 2020 has been paid upon completion of the notice period in the end
of May 2021. Total compensation to the former CFO/EVP was NOK 9.06 million. The company loan to CFO/EVP was settled at the same time.
Martin Lundberg has held the position as CFO from 01.01. 2021.
A loan of NOK 2.5 million has been given to both the CEO and EVP in 2016. The loan to EVP was settled in 2021. The loan to the CEO is to be
settled in 2022. The annual interest on the loans are 2%. There is sucient security related to the loan. No other loans have been given to or
any security provided for the members of the Board of Directors, members of the Group management or other employees or close relatives of
the same Group.
Specification of Auditor’s fee (excl. VAT) 2021 2020
Fee for audit of financial statements 6.6 6.3
Fee for other attestation services 0.1 -
Fee for other tax consultancy 0.1 0.4
Fee for other services 0.5 -
Total 7.3 6.7
The Board has drawn up the following statement
The Board of Directors prepares annually a separate statement regarding the remuneration of executives in accordance with the Norwegian
Public Limited Companies Act, Allmennaksjeloven § 6-16a. The following guideline is presented at the annual General Meeting.
Responsibilities and duties of the Compensation Committee
The Board of Directors has established a Compensation Committee. See statement on guidelines for defining salaries and other payments for the
CEO and other senior executives of the Group below:
The following functions shall be the common recurring activities of the Committee in carrying out its responsibilities for establishing and reviewing
the overall compensation philosophy of the Group. These functions should serve as a guide with the understanding that the Committee may carry
out additional functions and adopt additional policies and procedures as may be appropriate in light of changing business, legislative, regulatory
or other conditions. The Committee shall also carry out any other responsibilities and duties delegated to it by the Board of Directors from time
to time related to the purposes of the Committee.
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The Committee, in discharging its oversight role, is empowered to study or investigate any matter of interest or concern that the Committee
deems appropriate and shall have the sole authority to retain outside counsel or other experts for this purpose, including the authority to approve
the fees payable to such counsel or experts and any other terms of retention.
The main principles guiding the Group’s executive remuneration policy is that senior executives shall be oered terms which are competitive in
terms of salary, benefits in kind, bonus and pension plan taken as a whole. The Company oers a salary level which reflects a comparable level
in equivalent companies and businesses, taking into account the Company’s need for well qualified sta in all parts of the business.
When it comes to setting salaries and other payments for senior executives, this must be in line with the principles outlined above at all times.
Payments to senior executives over and above the basic salary shall be restricted to bonuses. Any bonus to the CEO and other senior executives
is set by the Compensation Committee. Bonuses to other executives are set by the CEO in conjunction with the Chairman of the Board. DOF
Subsea AS does not have any schemes for granting options to purchase shares in the Company or in other companies within the Group. Senior
executives are members of the Group’s pension plan, which provides pension benefits not exceeding 12 G (G = national insurance basic amount)
per year. Senior executives may have agreements concerning Company cars and phones, but do not receive any other benefits in kind.
27. Companies within the Group
Subsidiary Owner Registered office
Proportion of
ownership and votes
DOF Installer ASA DOF Subsea AS Austevoll, Norway 84.90%
DOF Subsea Chartering AS DOF Subsea AS Bergen, Norway 100%
DOF Subsea Congo S.A. DOF Subsea AS Pointe-Noire, Republice du Congo 55%
DOF Subsea Norway AS DOF Subsea Atlantic AS Bergen, Norway 100%
DOF Subsea Norway Offshore AS DOF Subsea Atlantic AS Bergen, Norway 100%
DOF Subsea Atlantic AS DOF Subsea AS Bergen, Norway 100%
DOF Subsea Rederi AS DOF Subsea AS Bergen, Norway 100%
DOF Subsea Rederi III AS DOF Subsea AS Bergen, Norway 100%
DOF Subsea ROV AS DOF Subsea AS Bergen, Norway 100%
DOF Subsea Angola Lda DOF Subsea AS Luanda, Angola 100%
DOF Subsea Asia Pacific Pte Ltd DOF Subsea AS Singapore 100%
DOF Subsea Asia Pacific Pte Ltd Philippine Branch
DOF Subsea Asia Pacific Pte Ltd Muntinlupa City, Philippines 100%
DOF Subsea Brasil Serviços Ltda DOF Subsea AS Macaé, Brazil 100%
DOF Subsea UK Ltd DOF Subsea Atlantic AS Aberdeen, UK 100%
DOF Subsea Ghana Ltd
DOF Subsea Ghana Investments
Ltd
Accra, Ghana 49%
DOF Subsea USA Inc DOF Subsea AS Houston, USA 100%
PT DOF Subsea Indonesia DOF Subsea Asia Pacific Pte Ltd Jakarta, Indonesia 95%
DOF Subsea Labuan Bhd DOF Subsea Asia Pacific Pte Ltd Labuan, Malaysia 100%
DOF Subsea Australia PTY DOF Subsea Asia Pacific Pte Ltd Perth, Australia 100%
DOF Subsea Malaysia Sdn Bhd DOF Subsea Asia Pacific Pte Ltd Kuala Lumpur, Malaysia 100%
DOF Subsea Offshore Services Pte Ltd DOF Subsea Asia Pacific Pte Ltd Singapore 100%
Mashhor DOF Subsea Sdn DOF Subsea Australia Pty Ltd Negara Brunei Darussalam 50%
DOF Subsea Ghana Investments Ltd DOF Subsea UK Ltd Accra, Ghana 100%
DOF Subsea Canada Corp. DOF Subsea US Inc St. Johns, Canada 100%
A significant part of non-controlling interest in the Group is related to DOF Installer ASA. DOF Installer ASA owns and operate three vessels
that mainly are working for other companies in the Group. All vessels in DOF Installer ASA are financed with external debt and equity. Other
non-controlling interests in the Group are insignificant.
Non-controllings share of DOF Installer ASA`s key financial positions and earnings:
Non-controlling share of key financial positions and earnings 2021 2020
EBITDA 17 20
Profit (loss) for the year -9 -49
Tangible assets 222 225
Unrestricted cash and cash equivalents 85 76
Total equity 100 109
Current portion of debt 214 208
The preliminary financial statements of DOF Installer ASA are not audited at the DOF Subsea Group reporting date.
For further information, please refer to note 31 ‘Accounting policies’, paragraph B for information on subsidiaries and to note 31 ‘Accounting
policies’, paragraph N for information on transactions with non-controlling interests.
DOF Subsea Group Amounts in NOK million
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28. Investments in joint ventures and assosiates
The Group has the following investments in joint ventures and assosiates accounted for using the equity method:
Name of entity
Place of business/
country of
incorporation Industry
% of ownersghip
interest
Nature of
relationship
Measurement
method
DOFCON Brasil Group Norway Subsea Chartering 50% Joint Venture Equity
KDS JV AS Norway Subsea Operations 50% Joint Venture Equity
DOF Management Group Norway Vessel management and operation 34% Associate Equity
Marin IT AS Norway IT 35% Associate Equity
Semar AS Norway Engineering 42% Associate Equity
Reconciliation of the aggregate carrying amounts of the investments
2021
DOFCON Brasil
Group KDS JV AS Associated companies Total
Book value of investment
01.01
2 328 - 63 2 391
Profit/loss for the period 281 - 15 296
Other comprehensive income 115 - - 115
Repayment of capital - - -1 -1
Book value of investment
31.12 2 724 - 77 2 802
2020
DOFCON Brasil
Group Associated companies Total
Book value of investments
01.01
1 773 - 87 1 859
Reclassification from
subsidiaries
- - 6 6
Profit / loss for the period 603 - -30 573
Other comprehensive income -47 - - -47
Book value of investments
31.12 2 328 - 63 2 391
Please refer to note 31 ‘Accounting policies’, paragraph B, for information about joint arrangements and associates.
Information about the joint ventures
T
he Group has two joint ventures; DOFCON Brasil AS and KDS JV AS both owned 50 % by DOF Subsea Group. KDS JV AS is owned 50 % by
Kværner AS.
KDS JV has entered into a subcontract with Kværner AS to perform marine operations for the Hywind Tampen project for Equinor. The company
has minor eect to the result of the Group in 2021.
DOFCON Brasil AS is a holding company located in Bergen. It is jointly owned by DOF Subsea AS and Technip Coflexip Norge AS. DOFCON
Brasil AS owns and controls TechDOF Brasil AS and DOFCON Navegação Ltda. DOFCON Brasil Group owns and operates six vessels.
TechDOF Brasil AS owns and operates two vessels, Skandi Açu and Skandi Buzios. Both vessels operates at long-terms contracts in Brazil with
Petrobras.
DOFCON Navegação Ltda owns and operates Skandi Niterói, Skandi Vitória, Skandi Recife and Skandi Olinda. Skandi Recife and Skandi Olinda are
on long-term contracts in Brazil with Petrobras. Skandi Vitoria and Skandi Niteroi have during the year operated on contracts with TechnipFMC.
DOFCON Navegação Ltda applied from 2013 hedge accounting related to foreign exchange risk on the portion of the company’s highly probable
revenue in USD hedging the company’s debt in USD. As of January 2017 DOFCON Navegação Ltda, changed its functional currency from BRL to
USD. The change in the functional currency eliminated the foreign exchange risk that, consequently, resulted in the prospective discontinuation
of the cash flow hedge accounting. The accumulated hedge reserves held in other comprehensive income NOK -333 million was converted by
use of exchange rate as of 1st of January 2017. The recycling of the accumulated hedge reserve to the consolidated statements of comprehensive
income in 2021 is NOK 30 million (NOK 56 million). The Group`s share of other comprehensive income related to hedging was NOK 132 million
per 31.12.2021. The cost is included in the Share of net income from joint ventures and associates. The negative eect of the recycling has no
cash eect, nor eect on the Group's equity.
In 2021 an impairment on Skandi Vitoria of NOK 98 million has been recognised (Skandi Vitoria and Skandi Niteroi NOK 241 million in 2020).
The impairment is included in the profit/loss for the period.
DOF Subsea AS has guaranteed for 50% of the obligations related to loans on the vessels in the joint venture, see also note 25 'Related parties'
and 24 ‘Gua
rantees’.
DOF Subsea Group Amounts in NOK million
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Sensitivity analysis of investment in joint ventures
Negative eect on net future cash flows with 20% will result in an additional impairment of the vessels with NOK 875 million (DOF Subsea
share: NOK 437 million). This will aect five of the DOFCON Brasil Group's vessels and might result in additional impairment in DOFCON Brasil
Group, which in turn might aect the book value of the Group's investment in DOFCON Brasil Group .
Associates
DOF Management AS and Norskan Oshore Ltda performs vessel management, vessel operation and other related services to vessel owners in
the oshore energy industry. DOF Management AS and Norskan Oshore Ltda delivers vessel management to the DOF Subsea Group’s fleet.
DOF Subsea own 34% of DOF Management AS, the remaining 66% is owned by DOF ASA.
Marin IT AS delivers IT services. DOF Subsea Group is a customer of Marin IT AS. The remaining shares in Marin IT AS are owned by DOF
ASA and Austevoll Seafood ASA.
Summarised preliminary consolidated financial information for the joint ventures DOFCON Brasil Group and KDS JV AS.
The information disclosed reflects the amounts presented in the preliminary financial statements of DOFCON Brasil Group and KDS JV AS. The
table also reconciles the summarised financial information to the DOF Subsea Group’s share and carrying amount of the investment.
2021 2020
Statement of comprehensive income
DOFCON
Brasil Group KDS JV AS Total
DOFCON
Brasil Group
Operating revenue 2 473 21 2 494 2 711
Operating expenses -493 -21 -514 -453
Operating profit before depreciation (EBITDA) 1 980 - 1 980 2 258
Depreciation and impairment -803 - -803 -701
Operating profit (EBIT) 1 177 - 1 177 1 557
Net financial income / loss -469 - -469 -581
Profit / loss before tax 707 - 707 976
Income tax expenses -145 - -145 229
Profit / loss for the year 562 - 562 1 206
Other comprehensive income / loss, net of tax 230 - 230 -95
Total comprehensive income / loss for the year, net of tax 792 - 792 1 112
DOF Subsea Group’s share of profit for the year 396 - 396 555
Statement of financial position 2021 2020
Assets
Deferred tax asset 660 - 660 696
Tangible assets 11 705 - 11 705 11 627
Non-current assets 12 365 - 12 365 12 323
Total receivables 498 3 502 560
Cash and cash equivalents 884 53 937 904
Current assets 1 382 57 1 439 1 464
Total assets 13 747 57 13 804 13 787
Equity and liabilities
Total equity 5 449 - 5 449 4 657
Non-current liabilities 6 678 - 6 678 7 520
Current liabilities 1 620 56 1 677 1 610
Total liabilities 8 298 56 8 355 9 130
Total equity and liabilities 13 747 57 13 804 13 787
DOF Subsea Group’s carrying amount of the investment 2 724 - 2 724 2 328
The preliminary financial statements of the joint ventures are not audited at the DOF Subsea Group reporting date. Figures above are consolidated
with the use of the equity method in the DOF Subsea Group financial statements.
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Summarised financial information for associates
The table below provides summarised financial information for the associate companies. The information disclosed reflects the Group’s share
in the financial statements of the associate companies. The preliminary financial statements of the associate companies are not audited at the
Group reporting date.
2021
Associated companies Assets at 31.12 Liabilities at 31.12 Equity at 31.12. Profit / loss for the year
DOF Management Group 122 60 62 11
Marin IT AS 25 16 9 3.5
Semar AS 11 5 6 0
Master & Commander IS - - - 1
Group's carrying amount of investments - - 77 -
2020
Associated companies Assets at 31.12 Liabilities at 31.12 Equity at 31.12 Profit / loss for the year
DOF Management Group 125 74 51 -
Marin IT 24 18 6 -
Semar AS 9 3 6 -
Master & Commander - - - -30
Group’s carrying amount of the investment - - 63 -
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29. Contingencies
DOF Subsea is subject to court proceedings for alleged oences against
the Oshore Petroleum and Greenhouse Gas Storage Act 2006, in relation
to a 2017 saturation dive campaign undertaken in Australian waters.
The Matter has been before the Australian Courts with the proceedings
being concluded end March 2022. The Court`s determination is expected
to be finalized by the end of the second half 2022.
Based on facts and circumstances it is the Group`s view that it is more
likely than not that there will be no future cash outflow related to the
dive campaign in 2017. No provision related to the dive campaign is
included in DOF Subsea Group’s accounts as of 31st of December 2021.
There is always a risk that changes in interpretations of facts and
circumstances will be interpreted to the detriment of the Group. Such
changes might result in future cash outflow for the Group. The Group
is not involved in any other legal disputes or on-going legal matters
involving potential losses, except for the tax related claims, disputes
mentioned in note 3 ‘Accounting estimates and assessments’ and what is
mentioned above. Please refer to note 31 ‘Accounting policies’, paragraph
L, for discussion on contingent liabilities.
30. Events occurring after period end
New contracts
DOF Subsea has been awarded an extension of the current contract
with a key renewable’s client for Skandi Acergy in the North Sea and
another project in Trinidad and Tobago for the vessel Skandi Constructor.
The DOF Subsea Asia-Pacific region has further been awarded a 3-year
contract plus 2 x 1- year options to provide a Multi- Purpose Supply
Vessel (MPSV) to Esso Australia Pty Ltd. In Australia DOF Subsea
has been awarded Woodside Energy Limited's Enfield XT Retrieval
and Oshore Support Services contract, expected to be undertaken in
Q3 and Q4 2022, utilising MPSV Skandi Hercules. DOF Subsea USA
has been awarded the first SURF project for the Skandi Constructor
from Vaalco Energy at the Etame field, oshore Gabon. Engineering
and design work has commenced with subsea work forecasted to begin
in July and expected to be completed by September 2022. In addition
DOF Subsea won multiple new contracts with Renewables and Oil & Gas
utilising Skandi Acergy, Skandi Constructor, Skandi Hera and selected
third-party vessels for 185 vessel days. In GOM DOF Subsea has entered
into an agreement with Otto Candies for the charter of the Jones Act
compliant vessel Chloe Candies for a firm period of one year from May.
Assets
The current charterer of Geosea (RSV, built in 2002) owned by DOF
Subsea Rederi AS, has exercised its purchase option, with delivery during
2nd or 3rd quarter 2022.
Finance
On 31st of March 2022, DOF ASA and DOF Subsea AS have agreed to
further extend the principal and interest suspension agreements with,
or received extensions of similar concessions from, secured lenders
representing in total 95% of the secured debt of companies within the
Group (excluding DOF Subsea Brasil Servicos Ltda.) until the 30th of
April 2022. The ad hoc group of bondholders in DOF Subsea AS have
agreed to further extend the standstill agreement until the 30th of April
2022, in accordance with the resolution in the bondholders' meeting
held 28 February 2022. The extensions of the standstill periods will
facilitate the Group’s continued dialogue with its secured lenders and
the bondholders under the Group’s bonds regarding a long-term financial
restructuring of the Group.
Invasion of Ukraine
The global community is witnessing the invasion of Ukraine, and the Group
see the repercussions of fractured tensions in international cooperation.
However, the Group has not identified any potential exposure to assets or
operations in Eastern Europe, specifically Ukraine and Russia.
Minority interest in DOF Installer ASA
In 2022 DOF Subsea AS has sent an oer to the minority shareholders
in DOF Installer ASA to buy the remaining 15.08 % of the company at
a proce of 4.35 per share.
31. Accounting policies
A. Summary of significant accounting principles
The consolidated financial statements of the Group have been prepared
in accordance with International Financial Reporting Standards (IFRS)
as adopted by the EU.
B. Group
Consolidation
Subsidiaries are all entities over which the Group has control. The
Group controls an entity when the Group is exposed to, or has rights to,
variable returns from its involvement with the entity and has the ability
to aect those returns through its power over the entity. Subsidiaries
are consolidated from the date control is transferred to the Group.
Subsidiaries are deconsolidated from the date control ceases.
Intercompany transactions, balances and unrealised gains on transactions
between Group companies are eliminated. When necessary, amounts
reported by subsidiaries have been adjusted to conform to the Group’s
accounting policies.
DOF ASA companies
DOF ASA companies are defined as DOF ASA and its subsidiaries
excluding companies within the DOF Subsea Group.
Joint arrangements and associates
Investments in jointly controlled companies are classified as either joint
operations or joint ventures depending on the contractual rights and
obligations for each investor. DOF Subsea Group has assessed the nature of
its jointly controlled companies and determined them to be joint ventures.
Joint ventures are accounted for by using the equity method of accounting.
Associates are all entities over which the Group has significant influence
but not control, generally accompanying a shareholding of between 20%
and 50% of the voting rights. Investments in associates are accounted
for by using the equity method of accounting.
Under the equity method of accounting, the investment is initially
recognised at cost and adjusted thereafter to recognise the Group’s
share of post-acquisition profits or losses and movements in other
comprehensive income in the investee. The Group’s investment in the
investee includes goodwill identified on acquisition. When the Group’s
share of losses equals or exceeds its interest in the investee (which
includes any long-term interests that, in substance, form part of the
Group’s net investment in the investee), the Group does not recognise
further losses, unless it has incurred legal or constructive obligations
or made payments on behalf of the investee.
Unrealised gains on transactions between the Group and its investees
are eliminated to the extent of the Group’s interest in the investee.
Unrealised losses are also eliminated unless the transaction provides
evidence of an impairment of the asset transferred.
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If the ownership interest in an investee is reduced but significant
influence is retained, only a proportionate share of the amounts
previously recognised in other comprehensive income is reclassified
to profit or loss where appropriate.
The Group determines at each reporting date whether there is any
objective evidence that the investment in the associate has been impaired.
If this is the case, the Group calculates the amount of impairment as
the dierence between the recoverable amount of the associate and
its carrying value, recognising the amount in ‘share of net income
from joint ventures and associates’ in the consolidated statement of
comprehensive income.
Accounting policies of the investee have been changed where necessary
to ensure consistency with the policies adopted by the Group.
C. Segment reporting
Members of the Board of Directors are the Group’s chief operating
decision-makers. The Group has determined operating segments based
on the information given to the Group’s operating decision-makers for
the purposes of allocating resources and assessing performance. These
reports are defined as Management reporting.
Segments are reported to the chief operating decision-makers on a
regular basis. Corporate expenses and similar are allocated to the
segments proportionately based on estimated split of services delivered
to each segment.
The segment reporting is presented according to Management reporting,
based on the proportionate consolidation method of accounting for joint
ventures. The bridge between the Management reporting and the figures
reported in the financial statements is presented in the segment note.
Please refer to note 28 ‘Investment in joint ventures and associates’ for
further information on investments.
The Subsea/IMR Projects segment covers operations in four regions;
the Asia-Pacific region, the Atlantic region, the North America region
and the Brazil region. In the Subsea/IMR Projects segment, the vessels
and the equipment allocated to the segment are utilised on a global basis.
The Group has gradually built the Subsea/IMR Projects segment to
become a global provider of subsea services with a core focus on IMR.
In addition to the IMR market, the Subsea/IMR Projects segment has
focused on mooring, light construction, survey work and oshore wind
utilising the Group’s core competences and assets.
The Long-term Chartering segment covers letting of vessels to third-
party charterers and is managed through the Group’s associated company
DOF Management AS, DOF Management Pte Ltd and Norskan Oshore
Ltda. The Long-term Chartering segment is built on DOF Subsea’s long
standing as an internationally recognised vessel owner and operator of
high-end subsea vessels.
D. Conversion of foreign currency
Foreign currency
Items included in the financial statements of each of the Group’s entities
are measured using the currency of the primary economic environment
in which the entity operates, ‘the functional currency’. The functional
currency is mainly NOK, USD, AUD, GBP, CAD and BRL. The consolidated
financial statements are presented in NOK.
Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the transaction date.
Foreign exchange gains and losses resulting from the settlement of
such transactions are presented as realised currency gain/loss under
financial items. Similarly, the conversion at period end exchange rates
of monetary assets and liabilities denominated in foreign currencies
are recognised as unrealised currency gain/loss.
Group companies
Group companies that have a functional currency which diers from
the presentation currency (NOK) are converted into the presentation
currency as follows:
assets and liabilities presented at consolidation are converted to
presentation currency using the foreign exchange rate at the end
of the reporting period,
income and expenses are converted using the average rate of
exchange, and
all exchange dierences are recognised in other comprehensive
income and specified separately in the consolidated statement of
changes in equity.
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E. Classification of assets and liabilities
Assets are classified as current assets when:
the asset forms part of the entity’s operating cycle, and is
expected to be realised or consumed over the course of the
entity’s normal operations; or
the asset is held for trading; or
the asset is expected to be realised within 12 months after the
reporting period.
All other assets are classified as non-current assets.
Liabilities are classified as current liabilities when:
the liability forms part of the entity’s operating cycle, and is
expected to be realised or consumed over the course of the
entity’s normal operations; or
the liability is held for trading; or
settlement of the liability has been agreed upon within 12
months after the reporting period; or
the entity does not have an unconditional right to postpone
settlement of the liability until at least 12 months after the
reporting period.
All other liabilities are classified as non-current liabilities.
F. Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held
on call with banks. Restricted deposits are classified separately from
unrestricted bank deposits under cash and cash equivalents. Restricted
deposits include deposits with restrictions exceeding twelve months.
G. Trade receivables
Trade receivables are amounts due from customers for services
performed in the ordinary course of business. Contract assets are
presented together with trade receivables. A contract asset is the right
to consideration in exchange for services transferred to the customer.
If the Group performs by transferring services to a customer before the
customer pays consideration or before payment is due, a contract asset
is recognised for the earned consideration that is conditional.
Trade receivables are recognised initially at nominal amount. An
impairment analysis is performed at each reporting period to measure
expected credit losses.
H. Tangible assets and contract costs
Tangible assets are recognised at cost less accumulated depreciation and
accumulated impairment losses. The cost of tangible assets comprises
its purchase price, borrowing costs and any directly attributable costs
of bringing the asset to its operating condition. If significant, the
total expenditure is separated into components which have dierent
expected useful lives.
Depreciation is calculated on a modified straight-line basis over the
useful life of the asset. Depreciable amount equals historical cost less
residual value.
Depreciation commences when the asset is ready for its intended use.
The useful lives of tangible assets and the depreciation method are
reviewed periodically in order to ensure that the method and period
of depreciation are consistent with the expected pattern of financial
benefits expected to be derived from the assets.
When tangible assets are sold or retired, their cost and accumulated
depreciation and accumulated impairment loss are derecognised and
any gain or loss resulting from their disposal is included in profit or loss.
For vessels, residual value is determined based on estimated fair value
today as if the asset was at the end of its useful life. Useful life and
economic life of the Groups vessels is estimated to be 30 years. For
further information on depreciation see note 3 ‘Accounting estimates
and assessments’.
DOF Subsea Group Amounts in NOK million
Assets under construction
Assets under construction are capitalised as tangible assets during
construction as instalments are incurred. Building costs include
contractual costs and costs related to monitoring the project during
the construction period. Borrowing costs are added to the cost of those
assets. The capitalisation of borrowing costs ceases when the asset is
substantially ready for its intended use. Assets under construction are
not depreciated before the tangible asset is ready for its intended use.
Impairment of assets
All assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not
be recoverable. Whenever the carrying amount of an asset exceeds its
recoverable amount, an impairment loss is recognised. The recoverable
amount is the higher of an asset’s net selling price and value in use. Where
there are circumstances and evidence that impairment losses recognised
previously no longer exists or has decreased, a reversal of the impairment
loss is recognised, except for goodwill. For further information on the
calculation see note 3 ‘Accounting estimates and assessments’.
Periodic maintenance
Periodic maintenance is related to major inspection and overhaul costs which
occur at regular intervals over the useful life of an asset. The expenditure
is capitalised when it is probable that the Group will derive future financial
benefits from upgrading the asset. Periodic maintenance of a vessel is
depreciated on a straight-line basis until the vessel is due for its next periodic
maintenance. When new vessels are acquired, a portion of the cost price is
classified as periodic maintenance based on best estimates. Intervals between
periodic maintenance are calculated on the basis of past experience. The
estimated life of each periodic maintenance program is 5 years.
Ordinary repairs and maintenance costs of assets are expensed as incurred.
Contract costs
Cost of obtaining a contract with customer and costs related to mobilisation
of vessel, equipment and personnel are capitalised and amortised
(presented as operational expenses) in line with the satisfaction of the
performance obligation. These costs are defined as contract costs. Contract
period is based on best estimates taken into consideration the initial agreed
period with probability for optional periods. A probability judgment is
performed in assessing whether the option period shall be included in
the contract period. Contract costs are classified and presented as other
non-current assets. For further information about contract cost, refer to
Q. ‘Revenue recognition’.
I. Leases
Where assets are financed through finance leases, under which substantially
all the risks and rewards of ownership are transferred to the Group, the
assets are treated as if they had been purchased outright. The amount
included in the cost of tangible assets represents the aggregate of the
capital elements payable during the lease. The corresponding obligation,
reduced by the appropriate proportion of lease or hire purchase payments
made, is included in borrowings. The amount included in the cost of
property, plant and equipment is depreciated on the basis described in the
preceding paragraphs and the interest element of lease payments made is
included in interest expense in the statement of comprehensive income.
Operational lease requires recognition of an asset (the right to use the
leased item) and a financial liability representing its obligation to make
lease payments. The Group has elected not to recognise right-of-use
assets and lease liabilities for:
• short-term leases that have a lease term of 12 months or less
• leases of low-value assets
• intangible assets
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Non-lease components within lease contracts will be accounted for
separately for all underlying classes of assets and reflected in the relevant
expense category as incurred.
Lease income from operating leases where the Group is a lessor is
recognised as operating revenue on a straight-line basis over the lease term.
Initial direct costs incurred in obtaining an operating lease are added to
the carrying amount of the underlying asset and recognised as expense
over the lease term on the same basis as lease income. The respective
leased assets are included in the balance sheet based on their nature.
J. Debt
Debt is recognised initially at fair value, net of incurred transaction
costs. Debt is subsequently carried at amortised cost; any dierence
between the proceeds (net of transaction costs) and the redemption
value is recognised in the consolidated statement of comprehensive
income over the period of the debt using the eective interest method.
Fees paid on the establishment of debt are recognised as transaction
costs of the debt to the extent that it is probable that some or all of
the liability will be drawn. In this case, the fee is deferred until the
drawdown occurs. To the extent there is no evidence that it is probable
that some or all of the liability will be drawn, the fee is recognised as
a prepayment for liquidity services and amortised over the period of
the liability to which it relates.
Interest expenses related to debt are recognised as part of the cost
of an asset when the borrowing costs accrue during the construction
period of a qualifying asset.
Debt is classified as a current liability unless it involves an unconditional
right to postpone payment of the liability for more than 12 months
from the reporting period.
K. Provisions
Provisions are recognised when, and only when, the Group faces an
obligation (legal or constructive) as a result of a past event, it is probable
(more than 50%) that a settlement will be required, and a reliable
estimate can be made of the obligation amount.
For onerous contracts, provisions are made when unavoidable cost
of meeting the obligations under the contract exceed the economic
benefit to be received under the contract. The unavoidable costs under
the contract are the lower of the cost of fulfilling the contract and any
compensation or penalties arising from failure to fulfil the contract.
From 01.01.2022 the Group will adopt changes in IFRS and increase
the cost base by including both direct cost and indirect cost in the
calculation of “unavoidable cost”. Provisions are reviewed at the end of
each reporting period and adjusted to the best estimate. When timing
is significant for the amount of the obligation, it is measured at its
present value. Subsequent increases in the amount of the obligation
due to interest are reported as interest costs.
L. Contingent assets and liabilities
Contingent assets are not recognised in the financial statements, but
are disclosed in the notes to the financial statements if it is probable
that the Group will benefit economically.
Contingent liabilities are defined as:
possible liabilities resulting from past events, but where their
existence relies on future events;
liabilities which are not reported in the financial statements
because it is improbable that the commitment will result in an
outflow of resources;
liabilities which cannot be measured with a sucient degree of
reliability.
DOF Subsea Group Amounts in NOK million
Contingent liabilities are not reported in the financial statements, with
the exception of contingent liabilities which originate from business
combinations. Significant contingent liabilities are presented in the
notes to the financial statements, except for contingent liabilities with
a very low probability of settlement.
M. Equity
Ordinary shares are classified as equity.
Transaction costs related to equity transactions, including tax eects
of transaction costs, are recognised directly in equity.
N. Transactions with non-controlling interests
The Group treats transactions with non-controlling interests as transactions
with equity owners of the Group. For purchases from non-controlling
interests, the dierence between any consideration paid and the relevant
share acquired of the carrying value of the non-controlling interests is
recorded in the consolidated statement of changes in equity. Gains or
losses on disposals to non-controlling interests are also recorded in the
consolidated statement of changes in equity.
O. Revenue recognition
The Group recognises income in line with the transfer of promised goods
or services to customers in an amount that reflects the consideration
to which the Group expects to be entitled in exchange for those goods
or services. Operating revenue is shown net of discounts, value-added
tax and other taxes on gross rates.
Day rate contracts
A day rate contract is a contract where the Group is remunerated by
the customer at an agreed daily rate for each day of use of the vessel,
equipment, crew and other resources and services utilised under the
contract. Such contracts may also include certain lump sum payments.
Under Long-term Chartering the Group delivers a vessel, including crew,
to a client. The charterer determines, within the contractual limits, how
the vessel is to be utilised. Under Subsea/IMR Projects the Group utilises
its vessels, equipment, crew and the onshore project organisation to
perform tailor made services on the client’s installations and/or assets.
The right to use the vessel fall in under the scope of IFRS 16 ‘Leases’,
and revenue is recognised over the lease period on a straight-line basis.
Distinct service components in a contract are accounted for separately
from other promises in the contract. Where the contracts include
multiple performance obligations, the transaction price is allocated to
each performance obligation based on the stand-alone selling prices.
Revenue is recognised over time as the services are provided. The stage
of completion determines the amount of revenue to recognise, and is
assessed based on an input or output method. The method applied is the
one that most faithfully depicts the Group’s progress towards complete
satisfaction of the performance obligation. Progress is usually measured
based on output methods such as days.
The Group does not recognise revenue during periods when the underlying
vessel is o-hire. In contracts where the Group is remunerated for maintenance
days the revenue is recognised over the contract period. The maintenance
days are recognised as receivables, and invoiced during o-hire.
Lump sum contracts
A lump sum contract is a contract where the Group is remunerated
by the client to a fixed price which is deemed to include the Group’s
costs, profit and contingency allowances for risks. Any over-run of costs
experienced by the Group is for the Group’s account, unless specifically
agreed with the client in the contract.
For lump sum projects, contract revenue and expenses are recognised
over time in accordance with the stage of completion of a contract. The
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stage of completion is calculated by dividing contract costs incurred to
date by total estimated contract costs. Revenue is recognised in line
with the stage of completion.
The method relies on the Group’s ability to estimate future costs in
an accurate manner over the remaining life of a project. The process
requires judgement, and changes to estimates or unexpected costs
resulting in fluctuations in revenue recognition and probability. Cost
forecasts are reviewed on a continuous basis and the project accounts
are updated in a monthly project manager’s report as a result of these
reviews. The reviews monitor actual cost of work performed project to
date, the estimate cost to complete and the estimate cost at completion.
This enables a reliable estimate for the likely outcome in terms of
profitability of each project.
As contract revenue, costs and the resulting profit are recognised as
the work is performed, costs incurred relating to future activities are
deferred and recognised as an asset in the consolidated statement of
financial position. Conversely, where revenue is received in advance of
costs being incurred, a deferred liability is recognised in the consolidated
statement of financial position.
Where the outcome of a project cannot be reliably measured, revenue will
be recognised only to the extent that costs are recoverable. Where it is
probable that contract costs will not be recovered, it is only costs incurred
that are recognised in the consolidated statement of comprehensive income.
Contract costs
Costs incurred relating to future performance obligations are deferred and
recognised as assets in the consolidated statement of financial position.
The nature of the asset is incremental costs of obtaining a contract, that
would not have incurred if the contract had not been obtained, and will
be recovered by the revenue over the contract period. Costs related to
contracts and future performance obligation longer than 12 months are
classified and presented as Other non-current assets. All other costs for
future performance are presented as other current assets. Contract costs
incurred will be expensed and presented as Operational expenses in line
with the satisfaction of the performance obligation.
Variation orders
Additional contract revenue arising from variation orders is recognised
when it is probable that the client will approve the variation and the
amount of revenue arising from the variation can be reliably measured.
Mobilisation
In contracts where the Group is remunerated for mob- or demobilisation
of vessel the remuneration is classified as prepayment and amortised
over the contract period.
Dividend income
Dividend income is recognised when the right to receive payment is
established.
Interest income
Interest income is recognised using the eective interest method.
P. Current and deferred income tax
The current income tax charge is calculated on the basis of the tax
laws enacted or substantively enacted at the consolidated statement
of financial position date in the countries where the Company’s
subsidiaries and associated companies operate and generate taxable
income. Permanent establishment of the operation will be dependent
on the Group’s vessels’ operations in the period. Tax is calculated in
accordance with the legal framework in those countries in which the
Group’s subsidiaries, associated companies or vessels with permanent
establishment operate and generate taxable income.
The Group periodically evaluates tax positions where applicable tax
regulation is subject to interpretation. Provisions are recognised on the
DOF Subsea Group Amounts in NOK million
basis of amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method,
on temporary dierences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated financial
statements. Deferred income tax is determined using tax rates (and laws)
that have been enacted or substantially enacted by the consolidated
statement of financial position date and are expected to apply when the
related deferred income tax asset is realised or the deferred income tax
liability is settled. For further information on deferred tax see note 3
‘Accounting estimates and assessments’ and note 9 ‘Tax‘.
Both tax payable and deferred tax are recognised directly in the
consolidated statement of changes in equity, to the extent they relate
to items recognised directly in the consolidated statement of changes in
equity. Similarly, any tax related to items reported as other comprehensive
income is presented together with the underlying item.
Companies under the shipping tonnage tax regime
The Group has companies that is organised in compliance with the tax
regime for shipping companies in Norway. This scheme entails no tax on
profits or tax on dividends from companies within the scheme. Net finance,
allowed for some special regulations, will continue to be taxed on an on-going
basis. In addition tonnage tax is payable, which is determined based on the
vessel’s net weight. This tonnage tax is presented as an operating expense.
Q. Employee benefits
The Group operates defined contribution pension plans.
Defined contribution plans
For defined contribution plans, the Group pays contributions to publicly
or privately administered pension insurance plans on a mandatory,
contractual or voluntary basis. The Group has no legal or constructive
obligations to pay further contributions if the fund does not hold sucient
assets to pay all employees the benefits relating to employee service in
the current and prior periods.
The contributions are recognised as an employee benefit expense when they
are due. Prepaid contributions are recognised as an asset to the extent that
a cash refund or a reduction in the future payments is available.
R. Financial assets
The Group classifies its financial assets in the following categories:
fair value through other comprehensive income (FVOCI), fair value
through profit or loss (FVTPL), or amortised cost. The classification of
financial assets under IFRS 9 is generally based on the business model
in which a financial instrument is managed and its contractual cash
flow characteristics. Classification of financial assets is determined at
initial recognition, and is not reclassified subsequently unless the Group
changes its business model for managing financial assets.
A financial asset shall be measured at amortised cost if both of the
following conditions are met, and it is not designated at FVTPL:
the financial asset is held within a business model whose objective
is to hold financial assets in order to collect contractual cash flows
and
the contractual terms of the financial asset give rise on specified
dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
A financial asset shall be measured at FVOCI if both of the following
conditions are met and it is not designated at FVTPL:
the financial asset is held within a business model whose
objective is achieved by both collecting contractual cash flows
and selling financial assets and
the contractual terms of the financial asset give rise on specified
dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
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All financial assets not classified as measured at amortised cost or FVOCI
as described above are measured at FVTPL. This includes all derivative
financial assets (see note 23 'Financial assets and liabilities: information
on the balance sheet'). On initial recognition, the Group may irrevocably
designate a financial asset that otherwise meets the requirements to
be measured at amortised cost or at FVOCI as at FVTPL if doing so
eliminates or significantly reduces an accounting mismatch that would
otherwise arise.
In assessing whether the contractual cash flows are solely payments
of principal and interest, the Group considers the contractual terms
of the instrument. This includes assessing whether the financial asset
contains a contractual term that could change the timing or amount of
contractual cash flows such that it would not meet this condition. In
making this assessment, the Group considers:
contingent events that would change the amount or timing of cash
flows;
terms that may adjust the contractual coupon rate, including
variable-rate features;
prepayment and extension features; and
terms that limit the Group’s claim to cash flows from specified assets
Financial assets at FVTPL
The assets are subsequently measured at fair value. Net gains and losses,
including any interest or dividend income, are recognised in profit or loss.
Financial assets at amortised cost
These assets are subsequently measured at amortised cost using the eective
interest method. The amortised cost is reduced by impairment losses. Interest
income, foreign exchange gains and losses and impairment are recognised in
profit or loss. Any gain or loss on derecognition is recognised in profit or loss.
Equity investments at FVOCI
These assets are subsequently measured at fair value. Dividends are
recognised as income in profit or loss unless the dividend clearly represents
a recovery of part of the cost of the investment. Other net gains and losses
are recognised in OCI and are never reclassified to profit or loss.
Derecognition
Financial assets are derecognised when the rights to receive cash flows
from the investments have expired or have been transferred and the
Group has transferred substantially all risks and rewards of ownership.
Impairment
The Group assesses at the end of each reporting period the expected
credit losses for a financial asset or a group of financial assets. See
paragraph H regarding trade receivables.
DOF Subsea Group Amounts in NOK million
Financial assets at fair value through comprehensive income
Financial assets at fair value through comprehensive income are financial
assets held for trading. A financial asset is classified in this category if
acquired principally for the purpose of profiting from short-term price
fluctuations. Derivatives are also categorised as held for trading unless
they are designated for hedge accounting.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. They are
included in current assets, except for maturities greater than 12 months after
the consolidated statement of financial position date. Loans and receivables
are classified as “trade receivables” and “other receivables”, and as “cash
and cash equivalents” in the consolidated statement of financial position.
Those exceeding 12 months are classified as non-current financial assets.
Loans and receivables are carried at amortised cost.
Regular purchases and sales of financial assets are recognised on the trade
date, that is the date on which the Group commits to purchase or sell the
asset. Investments are initially recognised at fair value plus transaction
costs for all financial assets not carried at fair value through comprehensive
income. Financial assets carried at fair value through comprehensive income
are initially recognised at fair value and transaction costs are expensed in
the consolidated statement of comprehensive income. Financial assets are
derecognised when the rights to receive cash flows from the investments
have expired or have been transferred and the Group has transferred
substantially all risks and rewards of ownership. Available-for-sale financial
assets and financial assets at fair value through comprehensive income are
subsequently carried at fair value.
Gains or losses arising from changes in the fair value of the “financial
assets at fair value through comprehensive income” category, including
interest income and dividends, are presented in the consolidated statement
of comprehensive income as financial income or expenses in the period
in which they arise. Dividend income from financial assets at fair
value through comprehensive income is recognised in the consolidated
statement of comprehensive income as part of financial income when
the Group’s right to receive payment is established. The fair values of
quoted investments are based on current bid prices. If the market for
a financial asset is not active (and for unlisted securities), the Group
establishes fair value by using valuation techniques.
The Group assesses at each consolidated statement of financial position
date whether there is objective evidence that a financial asset or a group
of financial assets are impaired. For further information about trade
receivables, see H. 'Trade receivables'.
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DOF Subsea Group Amounts in NOK million
S. Derivative financial instruments and hedging activities
The Group uses derivative financial instruments to manage certain exposures to fluctuations in foreign currency exchange rates and interest rates.
Foreign exchange derivatives are utilised to manage foreign exchange risk related to projected future sales. Interest rate derivatives are utilised to
manage interest rate risk by converting from floating to fixed interest rates. Derivatives financial instruments are initially recognised at fair value on
the date a derivative contract is entered into and are subsequently remeasured at fair value through profit or loss. The Group has currently not applied
hedge accounting for any hedging activities.
The fair values of various derivative instruments used for hedging purposes are disclosed in note 22 ‘Hedging activities’.
Derivates are carried as assets when the fair value is positive and as liabilities when the fair value is negative. The full fair value of a derivative is
classified as a non-current asset or liability when the remaining maturity of the item is more than 12 months, and as a current asset or liability
when the remaining maturity is less than 12 months. Trading derivatives are classified as current assets or liabilities.
T. Events after period end
New information and other events that provide evidence of conditions that existed at the end of the reporting period is included in the accounts.
Events occurring after the reporting period, which do not impact the Group’s financial position, but which have a significant impact on future
periods, are disclosed in the notes.
U. Use of estimates
The preparation of financial statements in conformity with IFRS, requires the use of certain critical accounting estimates. It also requires
management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or
complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in note 3 ‘Accounting
estimates and assessments’. Changes in accounting estimates are recognised in profit or loss for the period in which they occur. If the changes
also apply to future periods, the eect of the change is distributed over current and future periods.
V. Consolidated statement of cash flows
The consolidated statement of cash flows is prepared in accordance with the indirect model.
W. New standards, amendments and interpretations adopted by the Group
No new standards, amendments or interpretations have been adopted by the Group in 2021.
X. New standards, amendments and interpretations not yet adopted
IAS 37 Provisions Contingent Liabilities and Contingent Assets did not specify which costs to include in estimating the cost of fulfilling a
contract for the purpose of assessing whether that contract is onerous.
The International Accounting Standards Board developed amendments to IAS 37 to clarify that for the purpose of assessing whether a contract
is onerous, the cost of fulfilling the contract includes both the incremental costs of fulfilling that contract and an allocation of other costs that
relate directly to fulfilling contracts.
From 01.01.2022 the Group will adopt changes in IFRS and increase the cost base by including both incremental costs and an allocation of other
costs that relate directly to fulfilling contracts. The accounting policy for 2021 has been to only include incremental costs.
Other new standards and amendments mandatory for annual reporting periods after 31st of December 2021 is expected to not be significant
for the Group.
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32. Performance measurement definitions
Alternative performance measurements
The Group’s presents alternative performance measurements (APM)
that are regularly reviewed by management and aim to enhance the
understanding of the Group’s performance. APMS are calculated
consistently over time and are based on financial data presented in
accordance with IFRS and other operational data as described in the
table below.
Measure Description Reason for including
Operating profit before depreciation (EBITDA)
EBITDA is defined as operating profit, including
profit from sale of non-current assets, before
impairment of tangible and intangible assets,
depreciation of tangible assets and amortisation
of contract assets. EBITDA represents earnings
before interest, tax, depreciation and amortisation,
and is a key financial parameter for the Group.
This measure is useful in evaluating operating
profitability on a more variable cost basis as it
excludes depreciation, impairment and amortisation
expenses related primarily to capital expenditures
and acquisitions that occurred in the past. EBITDA
shows operating profitability regardless of capital
structure and tax situations with the purpose of
simplifying comparison in the same industry.
EBITDA margin
EBITDA margin presented is defined as EBITDA
divided by operating revenue.
Enables comparability of profitability relative to
operating revenue.
Operating profit (EBIT) EBIT represents earnings before interest and tax.
EBIT shows operating profitability regardless of
capital structure and tax situations.
Net interest-bearing debt
Net interest-bearing debt consists of both current
and non-current interest-bearing liabilities less
interest bearing financial assets, cash and cash
equivalents. Non-current receivables from joint
ventures are not included in net interest-bearing
debt. Cash and cash equivalents will include
restricted cash. Current interest-bearing debt
includes interest-bearing debt related to asset held
for sale.
Net interest-bearing debt is a measure of the
Group’s net indebtedness that provides an indicator
of the overall statement. It measures the Group’s
ability to pay all interest-bearing liabilities within
available interest bearing financial assets, cash and
cash equivalents, if all debt matured on the day of
the calculation. It is therefore a measurement of the
risk related to the Group’s capital structure.
Working capital
The working capital position of the Group is equal to
current assets less current liabilities.
It is a measure of the Group’s liquidity and efficiency,
and demonstrates the Group’s ability to pay its
current liabilities.
Other definitions
Measure Description
Equity ratio Equity ratio is defined as total equity divided by total assets at the reporting date.
Market value
Calculated average vessel value between several independent brokers’ estimates based on the principle of
“willing buyer and willing seller”.
Vessel utilisation
Vessel utilisation is a measure of the Group`s ability to keep vessels in operation and on contract with clients,
expressed as a percentage. The vessel utilisation numbers are based on actual available days.
Contract backlog
Sum of undiscounted revenue related to secured contracts in the future and optional contract extensions as
determined by the client in the future. Contract backlog excludes master service agreements (MSAs) within
the Subsea/IMR Projects segment. Under the MSAs only confirmed POs are included.
Firm contract backlog
Sum of undiscounted revenue related to secured contracts in the future. Secured contracts are contracts
signed with clients in the past, covering future delivery of services.
Backlog options
Sum of undiscounted revenue related to optional contract extensions as determined by the client in the
future.
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Financial Statements DOF Subsea AS
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DOF Subsea AS Amounts in NOK million
Statement of comprehensive income
Note 2021 2020
Operating revenue 17 91 99
Payroll expenses 4, 18 -47 -59
Other operating expenses 18 -14 -70
Operating profit before depreciation and impairment (EBITDA) 31 -30
Depreciation and impairment 7 -4 -3
Operating profit (EBIT) 27 -33
Income/loss from investments 1 -
Financial income 5 149 196
Financial expenses 5, 8, 19, 20 184 -2 211
Realised net gain / loss on derivative instruments and currency position 5 -37 -269
Unrealised net gain / loss on derivative instruments and currency position 5 22 67
Net financial income / loss 5 319 -2 216
Profit / loss before tax 345 -2 250
Income tax expense 6 16 -89
Profit / loss for the year 362 -2 339
Other comprehensive income net of tax
Items that will not be subsequently reclassified to profit / loss
Defined benefit plan actuarial gains / losses - -
Other comprehensive income / loss net of tax - -
Total comprehensive income / loss for the year net of tax 362 -2 339
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DOF Subsea AS Amounts in NOK million
Statement of financial position
Note 31.12.2021 31.12.2020
Assets
Tangible assets 7 17 13
Deferred tax asset 6 16 -
Investments in subsidiaries
19 3 258 2 607
Investments in joint ventures and associates
20 615 615
Non-current receivables from Group companies and joint ventures
5, 8, 16 11 123
Other non-current receivables
15, 16 3 5
Total non-current assets 3 920 3 364
Current receivables from Group companies and joint ventures
5, 8, 16 658 312
Other current receivables
9, 15, 16 6 3
Current receivables 663 315
Restricted cash
10, 16 15 31
Unrestricted cash and cash equivalents
10, 16 183 208
Cash and cash equivalents 199 239
Total current assets 862 554
Total assets 4 782 3 917
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Kathryn M. Baker
Director
Bergen, 6th of April 2022
The Board of Directors of DOF Subsea AS
Hans Olav Lindal
Chairman
Helge Singelstad
Director
Mons S. Aase
CEO
Harald Thorstein
Director
Marianne Møgster
Director
DOF Subsea AS Amounts in NOK million
Statement of financial position
Note 31.12.2021 31.12.2020
Equity and liabilities
Paid-in equity 24 1 674 1 674
Other equity -897 -1 259
Total equity 776 415
Bond loans 11, 16 - -
Debt to credit institutions 11, 16 - -
Lease liabilities 11, 16 8 16
Other non-current liabilities 4, 15, 16 - -
Total con-current liabilities 8 16
Current portion of debt 11, 16 3 220 3 050
Trade payables 12, 16 5 17
Current liabilities to Group companies 16 586 411
Other current liabilities 13, 15, 16 186 9
Total current liabilities 3 998 3 487
Total liabilities 4 006 3 503
Total equity and liabilities 4 782 3 917
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DOF Subsea AS Amounts in NOK million
Statement of changes in equity
Changes in equity Share capital Share premium
Other
paid-in capital Paid-in equity Other equity Total equity
Equity at 01.01.2021 1 674 - - 1 674 - 1259 415
Profit / loss for the year
- - - - 362 362
Other comprehensive income for the year
- - - - - -
Total comprehensive income for the year - - - - 362 362
Re-allocation of paid-in capital - - - - - -
Equity at 31.12.2021 1 674 - - 1 674 -897 776
Equity at 01.01.2020 1 674 540 540 2 753 - 2 753
Profit / loss for the year
- - - - -2 339 -2 339
Other comprehensive income for the year
- - - - - -
Total comprehensive income for the year - - - - -2 339 -2 339
Re-allocation of paid-in capital
- -540 -540 -1 080 1 080 -
Equity at 31.12.2020 1 674 - - 1 674 -1 259 415
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Note
2021 2020
Operating profit (EBIT) 27 -33
Depreciation and impairment 7 4 3
Change in trade payables 12 -12 -
Changes in other working capital -142 -49
Exchange rate effect on operating activities 1 -16
Cash flow from operating activities -122 -95
Interest received 5 145 163
Interest and other financial cost paid 5, 11 -32 -161
Tax paid - -4
Net cash flow from operating activities -8 -98
Purchase of tangible assets 7 -8 -5
Dividends / Group Contributions received 1 -
Payments on current receivables from Group companies and joint ventures 152 245
Cash flow from investing activities 145 240
Proceeds of debt to credit institutions 11 - 230
Installments on interest-bearing debt 11 -174 -201
Cash flow from financing activities -174 30
Net change in cash and cash equivalents -37 172
Cash and cash equivalents, included restricted cash, at 01.01 10 239 335
Exchange rate effect on cash and cash equivalents 5 -3 -269
Cash and cash equivalents, included restricted cash, at 31.12 10 199 239
Restricted cash at 31.12. 2021 is NOK 15 million (NOK 31 million) and is in included in Cash and cash equivalents. Changes in restricted cash
is reflected in the cash flow. For further information about restricted cash, please refer to note 10 `Cash and cash equivalents`.
DOF Subsea AS Amounts in NOK million
Statement of cash flows
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Contents
1 Corporate information and going concern ..........................103
2 Financial risk management ..................................................103
3 Accounting estimates and assessments ............................105
4 Payroll expenses .................................................................... 106
5 Financial income and expenses ........................................... 106
6 Tax ............................................................................................. 107
7 Tangible assets .......................................................................108
8 Receivables from Group companies and joint ventures ...108
9 Other current receivables .....................................................109
10 Cash and cash equivalents .................................................109
11 Interest-bearing debt ...........................................................109
12 Trade payables..................................................................... 112
13 Other current liabilities ...................................................... 112
14 Fair value estimation .......................................................... 112
15 Financial instruments and hedging activities ................. 112
16 Financial instruments - by category................................. 112
17 Related parties .....................................................................113
18 Remuneration to Board of Directors,
Executives and Auditor .......................................................114
19 Investments in subsidiaries ................................................115
20 Investments in joint ventures and associates .................115
21 Contingencies .......................................................................115
22 Guarantees ............................................................................115
23 Earnings per share...............................................................116
24 Share capital and share information .................................116
25 Events occurring after period end ....................................116
26 Accounting policies ..............................................................117
DOF Subsea AS
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Notes to the Financial Statements
2 Financial risk management
The Company is exposed to various types of financial risk relating
to its ongoing business operations: market risk (including foreign
exchange risk, interest rate risk and price risk), credit risk and liquidity
risk. The Company’s governing risk management strategy focuses on
minimising the potential negative eects on the Company’s results.
The primary risks managed using derivative instruments are foreign
currency risk and interest rate risk. Please see note 31 ‘Accounting
policies’, paragraph S, in the consolidated financial statements, for
information on derivative financial instruments and hedging activities.
See also note 15 ‘Financial instruments and hedging activities’.
The Company has had a policy to partly hedge interest rate risk
and foreign exchange risk, however the financial situation limits the
Company in this respect. This will increase the interest risk and foreign
exchange risk going forward.
Financial derivatives
The Company is exposed to currency risk and interest rate risk. The
Company uses to some extent financial derivatives to reduce these risks.
However, the Company does not use financial derivatives linked to
ordinary activities such as trade receivables, trade payables or similar.
Foreign exchange risk
The Company’s reporting currency is NOK. Foreign exchange risk
arises when future commercial transactions, contractual obligations
and liabilities are denominated in a currency that is not the functional
currency. The Company aims to achieve a natural hedge between cash
inflows and cash outflows and manages remaining foreign exchange
risk arising from commercial transactions, assets and liabilities by
foreign exchange contracts and similar instrument as appropriate.
Interest risk
The Company’s existing debt arrangements are debt at floating and
fixed interest rates. Movements in interest rates will have eects on
the Company’s cash flow and financial condition. The Company’s policy
is to maintain part of its debt at fixed rates.
Credit risk
Credit risk exposure arises on the values of financial assets recognised
in the statement of financial position. The Company’s trade receivables
balance is minimal and relates to subsidiaries, joint ventures and
associated companies. The Company has guidelines for monitoring and
recovering trade receivables.
Credit exposures to non-current and current receivables are mainly to
subsidiaries and joint ventures. The Company is well informed about
credit risks related to these positions. The current challenging market
conditions have increased these risks. The Company has recognised a
total impairment of loans and receivables of NOK 1,3061,306 million in 2021.
Of which NOK 132 million is recognised as loss in 2021.
The derivative contracts and bank deposits are entered into with the main
banks of the Company. The value of trade receivables recognised in the
statement of financial position is considered to reflect the credit risk.
1 Corporate information and going concern
DOF Subsea AS, the "Company", is a limited liability company registered
in Norway. The Company’s head oce is located at Thormøhlensgate 53
C, 5006 Bergen, Norway.
The Company is owned by DOF ASA as a sole shareholder with 100%
ownership stake on 31st of December 2021.
DOF Subsea AS is the parent company in the DOF Subsea Group exercising
control over a number of subsidiaries. The Company also holds investments
in joint and associate arrangements.
The DOF Subsea Group has two business segments, Subsea/IMR Projects
and Long-term Chartering. In these segments, the Group provides integrated
subsea and marine services to the world’s oshore energy producers.
Integrating project management capabilities with high end subsea vessels
creates long-term client relationships, broader market opportunities and
reduces overall risk. The Group’s two segments: vessels and personnel
working in the Subsea/IMR Projects segment and the vessels chartered
to third-party companies in the Long-term Chartering segment, increases
the Group’s access to market opportunities and reduces risk. The vessels
are divided into three categories: Multi-Purpose Support Vessels, Multi-
Purpose Anchor Handler Vessels, and Construction Support Vessels. The
Group also owns a fleet of ROV`s and other subsea equipments and has
over 15 years’ experience providing ROV and intervention services to
the energy industry worldwide. The ROVs are available on DOF Subsea
operated vessels or as supplementary support on any oshore vessel.
This section of the financial statements covers the parent company
accounts. The financial statements of the Company have been prepared in
accordance with the Norwegian accounting act § 3-9 and Finance Ministry’s
prescribed regulations on simplified IFRS. For further information see
note 26 ' Accounting policies'.
Going concern
In accordance with IAS 1.25, the Board of Directors confirms that the
financial statements have been prepared under the assumption of going
concern.
The Company’s financial position is not sustainable, and there is material
uncertainty related to going concern. Rolling short-term standstill
agreements with the majority of the Company’s lenders have been in
place since 2nd quarter 2020 and the current standstill agreements
are applicable until 30th of April 2022. The Company is on short-term
dependent on an extension of the standstill period and on longer term
dependent on a robust refinancing solution to continue as going concern.
The restructuring proposals being discussed with the secured lenders
and bondholders include conversion of debt to equity. The dialogue with
the lenders is constructive, but a refinancing solution is not yet in place.
The Group and the Company are dependent on continued standstill
agreements with its creditors until a long-term financial solution is
agreed to maintain as going concern.
Without continued standstill agreements or a long-term financing solution
in place, the Company can no longer present financial statements on the
assumption of going concern. If the Company cannot be treated as going
concern, the valuation of the Company’s assets will be further revised and
will result in significant impairment of the Company`s assets.
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Credit and Liquidity risk
Credit and liquidity risk arise from cash and cash equivalents, derivatives,
financial instruments and deposit with banks as well as payment terms
towards clients and suppliers. Liquidity risk management implies
maintaining sucient cash and marketable securities, and to maintain
available funding through committed credit facilities. The Group has a
policy of limiting the credit exposure to any single financial institution
and bank, and actively manages its exposure in order to achieve this.
To have available liquidity in all subsidiaries is challening due to the
current market conditions.
The Group’s counterparty credit risk has historically been low as the
Group’s customers traditionally have had good financial capability to
meet their obligations and have had high credit ratings. The sustained
challenging market situation has resulted in changes to the credit ratings
for some of the Group’s customers, and thereby increased the credit
risk. Historically, the portion of receivables not being collectable has
been low. Revenue from the 10 largest customers, large oil companies
and operators, represent approximately 62% of the Group`s revenue,
whereof Petrobras represent the largest customer.
Liquidity risk management implies maintaining sucient cash, marketable
securities, available funding through committed and uncommitted credit
facilities and ability to close market positions. For further information
about cash and cash management, see note 10 ‘Cash and cash equivalents’.
The standstill agreements and the short-term liquidity loan of NOK 100
million drawn in 2020, covers the Group’s short-term liquidity needs. The
Group is dependent on extension of the existing standstill agreements
until a long-term refinancing solution has been agreed.
The Group has routines to report cash flow forecasts on a regular basis
in order to monitor the Group’s future cash position.
Fair values
Fair value of forward exchange contracts is calculated based on the
midpoint of the relevant yield curve. Fair value of interest rate contracts
is calculated as the present value of the estimated futures cash flows
based on observables yield curves.
Capital structure and equity
The restructuring of the Company and the Group’s debt have been
ongoing in 2021 and standstill agreements have been agreed until the
30th of April 2022 with 95% of the secured lenders in the DOF Subsea
Group. The BNDES facilities in DOF Subsea Brasil Ltda. has been
served according to refinancing agreements signed in February 2020.
The standstill agreements assume payment of principal and interest of
a NOK 100 million credit facility provided by certain lenders in March
2020. The outstanding amount of this facility was NOK 47 million by
the end of the year.
The relevant Group companies have imposed unilateral standstill to
the secured lenders not participating in the standstill agreements. One
of the Group`s secured lenders has previously requested repayment of
a facility of USD 47 million, and in the 3rd quarter this facility was
prepaid at a significant discount. Another secured lender has enforced
an account pledge for one loan facility in the Group.
The ad hoc group of bondholders in DOFSUB07, DOFSUB08 and
DOFSUB09 have accepted to extend the standstill until the 30 April
2022 in accordance with the resolutions of the bondholders' meeting
held 28 February 2022.
The DOFCON JV is not part of the standstill agreements and serves
its debt according to the terms in the relevant loan facilities. Financial
covenants related to the Company`s 50% guarantee of the DOFCON
loan facilities have been waived.
The Company`s and the Group’s financial position is not sustainable,
and a long-term financial solution is necessary to continue as going
concern. Due to the ongoing debt restructuring of the Group, the vast
majority of the Group’s secured and unsecured debt has in accordance
with IFRS, been classified as current debt as per 31st of December
2021. This classification is based on that standstill agreements for debt
service with the banks and bondholders are less than 12 months. The
Group is dependent on a robust refinancing solution and the refinancing
proposal currently discussed include a comprehensive restructuring
of the Group’s balance sheet which include softer terms on the loan
facilities and conversion of debt.
Under normal circumstances, the main objective when managing the
Company’s capital structure is to ensure that the Company is able to
sustain an acceptable credit rating and thereby achieve favorable terms
and conditions for long-term funding which is suitable for the Company’s
operation and growth. The Company manages its own capital structure
and carries out all necessary amendments to the capital structure, based
on continuous assessments of the economic conditions under which the
operations take place and the short and medium to long-term outlook.
During the standstill period, the Company`s and the Group’s main
financial covenants have been waived. For further information, see note
11 ‘Interest bearing debt’.
DOF Subsea AS Amounts in NOK million
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3 Accounting estimates and assessments
Valuations, estimates and assumptions with a significant eect on the financial statements are summarised below:
Debt to credit institutions and bondholders
Due to the ongoing debt restructuring of the Group the bond loans have in accordance with IFRS, been classified as current debt as per 31st of
December 2021.
Agreement on a new long-term financing solution or waiver of more than 12 months duration, will result in change in presentation of debt to
credit institutions and bondholders.
For further information about debt to credit institutions and bondholders, see note 11 'Interest-bearing debt'.
Financial assets
All financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset
may not be recoverable. Whenever the carrying amount of an asset exceeds its recoverable amount, an impairment loss is recognised in the
statement of comprehensive income. The recoverable amount is the higher of an asset’s net selling price and value in use. Due to the challenging
market situation and the refinancing process the Company has recognised significant impairments of financial assets. However, improved marked
conditions in 2021 have resulted in reversal of some of the impairments from 2020. Changes in the market situation and in the refinancing
process, will have significant eect on the value of financial assets in the Company.
Deferred tax assets
Deferred tax assets are recognised in the statement of financial position on the basis of tax losses carried forward or deductible temporary
dierences, to the extent that it is probable there will be sucient future earnings available against which the loss or deductible can be utilised.
The Groups refinancing process has increased the risk of not being able to give group contribution within the Group to reduce payable tax to
Norway. The assumption is that elimination of taxable profit occurring in Norwegian companies from 2022 cannot be eected. Deferred tax
assets related to these future transactions are therefore not booked. Purpose of giving group contribution between companies in the Group is
to oset taxable profit in subsidiaries towards taxable loss carry forward in the Company. Deferred tax asset of NOK 16 million is based on the
assumption that group contribution calculated on taxable result for 2021 can be given.
For further information, reference is made to the consolidated financial statements and note 6 'Tax'.
DOF Subsea AS Amounts in NOK million
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4 Payroll expenses
Payroll expenses Note 2021 2020
Salary 18 -47 -41
Employer’s contributions -6 -5
Pension costs -2 -2
Other personnel costs 9 -11
Total payroll expenses -47 -59
Full time employees (at period end) 27 22
5 Financial income and expenses
Financial income and expenses Note 2021 2020
Gain / loss from sale of shares / liquidation 1 -
Income / loss from investments 1 -
Interest income from Group companies and joint ventures 67 98
Interest income 2 18
Guarantee income from Group companies and joint ventures 80 81
Financial income 149 196
Impairment of investments 19, 20 652 -1 531
Impairment of loans to Group companies 8 -132 -363
Interest expenses payable to Group companies -2 -3
Interest expenses payable to DOF ASA companies* -4 -10
Interest expenses -299 -280
Other financial expenses -30 -23
Financial expenses 184 -2 211
Realised foreign currency net gain / loss on loans -33 19
Realised foreign currency net gain / loss on current receivables / liabilities -4 -268
Realised net gain / loss on financial derivatives - -20
Realised net gain / loss on derivative instruments and currency position -37 -269
Unrealised foreign currency net gain / loss on loans 22 74
Net change in unrealised gain / loss on financial derivatives - -8
Unrealised net gain / loss on derivative instruments and currency position 22 67
Net financial income / loss 319 -2 216
DOF Subsea AS Amounts in NOK million
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6 Tax
Income tax expense 2021 2020
Change in deferred tax 16 -89
Total income tax expense 16 -89
Reconciliation of nominal and effective tax rate
Profit before tax 345 -2 250
Tax calculated at domestic tax rate 22% (22%) -76 495
Tax effect of:
Impairment of financial assets 114 -417
Unrecognised tax losses -22 -167
Total income tax expense 16 -89
The gross movement on the deferred tax in the statement of financial position 2021 2020
Deferred tax at 01.01 - 89
Impact on change in tax rate on deferred tax - -
Tax related to comprehensive income 16 -89
Deferred tax 31.12 16 -
Deferred tax
The table below specifies the temporary dierences between accounting and tax values, and calculation of deferred tax / tax asset at year-end.
The Company’s deferred tax asset is reviewed for impairment.
For further information about the risk and assessments done related to deferred tax, see note 3 `Accounting estimates and assessments`
Basis for deferred tax 2021 2020
Non-current assets -22 -26
Current assets -28
Liabilities 8 15
DOF Subsea AS Amounts in NOK million
Temporary differences not included in deferred tax 41 11
Total temporary differences - -
Tax loss carryforward -1 680 -1 650
Tax loss not included as deferred tax asset 1 608 1 650
Basis for calculating deferred tax / tax asset (-) 73 -
Total deferred tax / tax asset (-) recognised in the statement of financial position 16 -
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7 Tangible assets
Tangible assets 2021 2020
Cost at 31.12 149 144
Cost 01.01 149 144
Additions 8 5
Cost at 31.12 156 149
Depreciation at 01.01 -135 -132
Depreciation for the year -4 -3
Depreciation at 31.12 -140 -135
Book value at 31.12 17 13
Asset lifetime (years) 5-10 5-10
Depreciation schedule Linear Linear
The right of use asset in DOF Subsea AS per 31.12.2021 was NOK 4 million (NOK 6 million in 2020), with a depreciation of NOK 2 million (NOK
2 million).
8 Receivables from Group companies and joint ventures
Non-current receivables from Group companies and joint ventures Note 2021 2020
Non-current receivables from joint ventures 17 - 107
Non-current receivables from Group companies - basis 635 347
Non-current receivables from Group companies - impairment 5 -623 -330
Total non-current receivables from Group companies and joint ventures at 31.12 11 123
Current receivables from Group companies and joint ventures Note 2021 2020
Current receivables from joint ventures 126 222
Current receivables from Group companies - basis 1 214 1 138
Current receivables from Group companies - impairment 5 -682 -1 049
Total current receivables from Group companies and joint ventures at 31.12 658 312
Due to the challenging market situation and the refinancing process the Company has recognised significant impairments of receivables to
subsidiaries in the Group. However, improved marked conditions in 2021 have resulted in reversal of NOK 73 million of the impairments from
2020.
DOF Subsea AS Amounts in NOK million
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9 Other current receivables
Other current receivables 2021 2020
Government tax receivables 3 3
Prepaid expenses 3 -
Total other current receivables at 31.12 6 3
10 Cash and cash equivalents
Cash and cash equivalents 2021 2020
Restricted cash 15 31
Unrestricted cash and cash equivalents 183 208
Total cash and cash equivalents at 31.12 199 239
Restricted cash consists of cash only available for specific purposes. A portion of this cash serves as security for outstanding debt following
enforcements of account pledges. The balance of these accounts sums up to NOK 265 million. Some lenders have exercised their right to set o
such cash balances toward the outstanding loans. The Group has therefore chosen to present all restricted cash serving as security for loans,
net of debt to credit institutions. The balance of NOK 15 million at year-end 2021 relates to Guarantees.
The Company has an administrative cash pooling arrangement whereby cash surpluses and overdrafts residing in the Group Companies
bank accounts are pooled together to create a net surplus. Liquidity is made available through the cash pooling for the Companies in
the Group to meet their obligations. The bank accounts in the cash pool consists of accounts in various currencies. The total cash
pool can never be in net overdraft. The cash pool is presented as unrestricted cash and cash equivalents. For further information
about market-, credit- and liquidity risk see note 2 ‘Financial risk management’.
See DOF Subsea Group note 17 'Cash and cash equivalents' for further information about cash pool arrangements.
11 Interest-bearing debt
The Board and Management have, since the second quarter of 2019, been working on a long-term refinancing solution for the Company and Group
which includes discussions with secured lenders and the bondholders. DOF Subsea AS is the guarantor for all subsidiaries with mortgage secured debt.
The restructuring of the Group’s debt has been ongoing in 2021 and standstill agreements have been agreed until the 30th of April 2022 with
95% of the secured lenders in the DOF Subsea Group. The BNDES facilities in DOF Subsea Brasil Ltda. has been served according to refinancing
agreements signed in February 2020. The standstill agreements assume payment of principal and interest of a NOK 100 million credit facility
provided by certain lenders in March 2020. The outstanding amount of this facility was NOK 47 million by the end of the year.
The relevant Group companies have imposed unilateral standstill to the secured lenders not participating in the standstill agreements. One of the
DOF Subsea secured lenders has previously requested repayment of a facility of USD 47 million, and in the 3rd quarter this facility was prepaid
at a significant discount. Another secured lender has enforced an account pledge for one loan facility in DOF Subsea.
The bondholders in DOFSUB07, DOFSUB08 and DOFSUB09 have accepted a standstill until the 30th of Apil 2022.
The DOFCON JV is not part of the standstill agreements and serves its debt according to the terms in the relevant loan facilities. Financial
covenants related to the Group’s 50% guarantee of the DOFCON loan facilities have been waived.
The Group will continue the dialogue with its creditors to secure a long-term financial solution for the Group. Various debt restructuring proposals
have been discussed and the proposals include comprehensive restructuring of the Group’s balance sheet, including conversion of debt. The
Group’s secured- and unsecured debt are, in accordance with IFRS, classified as current debt at the 31st of December 2021. This classification
is based on the Group`s financial situation and standstill agreements of debt service with the banks and bondholders.
Restructuring costs related to advisory and legal fees amounts to NOK 45 million in 2021 and are included in the financial costs in the result.
Debt
DOF Subsea AS had as per period end three bond loans, which mature in 2020, 2022 and 2023. The trustee on behalf of the bondholders is
DOF Subsea AS Amounts in NOK million
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financial statements / dof subsea as
Nordic Trustee ASA. Interest rates are both floating and fixed. No particular security has been provided for the loans, and DOF Subsea AS is
free to acquire its own bonds. The Company has been in discussion with the bondholder in order to obtain a long-term financial solution for
the Company and the Group.
Non-current interest-bearing debt 2021 2020
Bond loans - -
Debt to credit institutions - -
Leasing debt 8 16
Total non-current interest-bearing debt 8 16
Current interest-bearing debt
Bond loans 2 979 2 554
Debt to credit institutions 130 282
Leasing debt 8 8
Current debt to Group companies 555 369
Total current interest-bearing debt 3 672 3 212
Total non-current and current interest-bearing debt 3 681 3 228
Net interest-bearing debt
Cash and cash equivalent 199 239
Interest bearing assets from Group companies 11 37
Total net interest-bearing debt 3 471 2 952
Current portion of debt in the statement of financial position includes accrued interest expenses. Accrued interest expenses are excluded in the
figures above. The company’s cash pooling system is included in the net interest-bearing debt.
Cash and non-cash changes in total borrowings
Changes in total borrowings over a period consists of both cash eects (disbursements and repayments) and non-cash eects (amortisations and
currency translation eects). The following is the changes in the Company’s borrowings:
2021 Cash changes Non-cash changes
Interest bearing debt
Balance
31.12.20 Cash flows
Capitalisation of
interest and other
changes
Amortised
loan expense
Currency
adjustment
Balance
31.12.21
Bond loans 2 554 - 379 4 42 2 979
Debt to credit institutions 282 -174 16 - 6 130
Debt to Group companies 369 185 - - - 555
Lease liabilities 23 -7 - - - 16
Total interest bearing debt 3 228 4 395 4 48 3 681
2020 Cash changes Non-cash changes
Interest bearing debt
Balance
31.12.19 Cash flows
Capitalisation of
interest and other
changes
Amortised
loan expense
Currency
adjustment
Balance
31.12.20
Bond loans 2 589 - - 1 -36 2 554
Debt to credit institutions 302 37 - - -57 282
Debt to Group companies 308 61 - - - 369
Lease liabilities
30 -7 - - - 23
Total interest-bearing debt 3 230 91 - 1 -93 3 228
Liabilities secured by pledge 2021 2020
Liabilities to credit institutions - 150
DOF Subsea AS Amounts in NOK million
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Book value of assets pledged as security - 320
Average rate of interest 9.99% 8.63%
Average interest rate is excluded interests on lease liabilities, which in 2021 yielded an average in the range of 4%-6%.
Currency distribution non-current liabilities incl first year repayment NOK USD Total
Bond loans 1 497 1 482 2 979
Debt to credit institutions 130 - 130
Total 1 627 1 482 3 110
Debt to credit institution in USD are revaluated to NOK using exchange rate as per 31st of December 2021.
The estimated fair values of the Company’s bond loans at period end, based on last transactions registered, were as follows::
31.12.2021 31.12.2020
Loan Due date*) Coupon rate Price **)
Outstanding
amount***) Initial value Price **)
Outstanding
amount***) Initial value
DOFSUB07 31.03.2021 7.52% 20.25 467 1 300 20.25 467 1 300
DOFSUB08 14.03.2022 9.50% 20.25 1 297 1 539 20.25 1 255 1 489
DOFSUB09 27.11.2023 8.81% 25 840 900 25 840 900
Capitalised interest 379
Amortisation cost -4 -9
Total 2 979 3 739 2 553 3 689
Fair values of bonds are based on last transaction done and registered at Oslo Børs.
*) DOFSUB07 and DOFSUB08 due date has been extended to end of the standstill period.
**) Price at par price is the latest turnover done in 2020, due to the ongoing refinancing no turnover is recognised in 2021.
***) The outstanding amount on each bonds are lower than initial ampunt, due to own bonds.
The fair value of the bond loans are estimated to NOK 644 million. The amounts include fair value on capitalised interest based on the latest
turnover done on the loans.
The trustee on behalf of the bondholders is Nordic Trustee ASA. Interest rates are both floating and fixed. No particular security has been provided
for the loans, and the Group is free to acquire its own bonds.
Financial covenants
As part of the current standstill agreements the following covenants have been waived (based on the proportionate consolidation method of
accounting for joint ventures):
The Group shall have available cash of at least NOK 500 million at all times (based on the proportionate consolidation method of
accounting for joint ventures)
The Group shall have value-adjusted equity to value-adjusted assets of at least 30%
The Group shall have book equity of at least NOK 3,000 million at all times
The Group shall have positive working capital at all times, excl. current portion of debt to credit institutions
The fair value of the Group’s vessels shall always be at least 110-130% of the outstanding loan amount
In addition to the above-mentioned financial covenants, the loan agreements are also subject to the following conditions:
The Group’s assets shall be fully insured
There shall not be any change of classification, flag, management or ownership of the vessels without the prior written approval of the
lenders
DOF ASA shall be the principal shareholder in DOF Subsea AS, and own a minimum of 50.1% of the shares
DOF Subsea AS shall not merge, demerge or divest activities without the prior written approval of the lenders
DOF Subsea AS shall report financial information to the lenders and Oslo Stock Exchange on a regular basis
The Group’s vessels shall be operated in accordance with applicable laws and regulations
The Group has further received waiver for the financial covenants as guarantor for two facilities in the joint venture with TechnipFMC.
If waivers are not extended, it is a significant risk that the Company and the Group will be in breach of its covenants.
DOF Subsea AS Amounts in NOK million
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12 Trade payables
Trade payables 2021 2020
Trade payables at nominal value 4 -2
Accrued expenses 1 19
Total trade payables at 31.12 5 17
13 Other current liabilities
Other current liabilities Note 2021 2020
Provision foreign tax 1 1
Public duties payables 3 4
Other current liabilities 3 4
Accured guarantee expenses for subsidiaries 22 179 -
Total other current liabilities at 31.12 186 9
14 Fair value estimation
For those financial and tangible assets and liabilities, which have been recognised at fair value in the Statements of Financial Position, the
measurement hierarchy and valuation methods described below have been applied. There have been no transfers between fair value levels.
Measurement level 1 (Quoted, unadjusted prices in active markets for identical assets and liabilities). Not in use for any assets or liabilities.
Measurement level 2 (Techniques for which all inputs which have significant eect on the recorded fair value are observable, directly and indirectly).
The fair value of forward exchange contracts is determined using the forward exchange rate at the end of the reporting period. The forward
exchange rate is based on the relevant currency’s interest rate curves. The fair value of interest swaps is determined by the present value of
future cash flows, which is also dependent on the interest curves.
Measurement level 3 (Techniques which use inputs which have significant eect on the recorded fair value that are not based on observable market data).
15 Financial instruments and hedging activities
The Company has had a policy to partly hedge interest rate risk and foreign exchange risk, however the financial situation limits the Company
in this respect. This will increase the interest risk and foreign exchange risk going forward.
As of 31st of December 2020 and 2021 the Company had no foreign exchange derivatives to hedge future sales to customers on behalf of subsidiaries.
Foreign exchange derivatives were utilised to hedge foreign exchange risk related to projected future sales. Interest rate swaps were utilised to manage
interest rate risk by converting from floating to fixed interest rates.
16 Financial instruments - by category
This note gives an overview of the carrying value of the Company’s financial instruments and the accounting treatment of these instruments.
The table is the basis for further information regarding the Company’s financial risk.
DOF Subsea AS Amounts in NOK million
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31.12.2021 Note
Financial
instruments at
fair value through
profit and loss
Financial
instruments
measured at
amortised cost Total
Of which included
net in interest
bearing debt
Assets
Other non-current receivables 8 - 14 14 11
Other current receivables 8 - 658 658 -
Restricted cash 10 - 15 15 15
Unrestricted cash 10 - 183 183 183
Total financial assets - 870 870 210
Liabilities
Interest-bearing non-current liabilities 11 - 8 8 8
Current portion of debt 11 - 3 220 3 220 3 118
Current derivatives 15 - - - -
Trade payables and other current liabilities 12, 13 - 774 774 555
Total financial liabilities - 4 002 4 002 3 681
31.12.2020 Note
Financial
instruments at
fair value through
profit and loss
Financial
instruments
measured at
amortised cost Total
Of which included
net in interest
bearing debt
Assets
Other non-current receivables 8 - 128 128 17
Other current receivables 8, 9, 15 - 312 312 20
Restricted cash 10 - 31 31 31
Unrestricted cash 10 - 208 208 208
Total financial assets - 679 679 276
Liabilities
Interest-bearing non-current liabilities 11 - 16 16 16
Current portion of debt 11 - 3050 3050 2 843
Current derivatives 15 - - - -
Trade payables and other current liabilities 12, 13 - 431 431 369
Total financial liabilities - 3 497 3 497 3 228
The company’s cash pooling system is included in the net interest-bearing debt.
The carrying amount of cash and cash equivalents is approximately equal to fair value since these instruments have a short term to maturity.
Similarly, the carrying amount of trade receivables and trade payables are approximately equal to fair value since they are entered into at
standard terms and conditions.
17 Related parties
Detailed description of related parties and DOF Subsea AS relationship to these
The Company is owned by DOF ASA as a sole shareholder with 100% ownership stake on 31st of December 2021. All sales transactions are carried
out in accordance with DOF Subsea policy.
Rental of office space
Part of the oce space located at Thormøhlensgate 53 C, 5006 Bergen, rented by DOF Subsea AS, is used by DOF Management AS, DOF ASA,
DOF Subsea Norway AS and Marin IT AS. The rental fee charged to DOF Management AS, DOF ASA, DOF Subsea Norway AS and Marin IT AS is
determined at NOK 8 million per year.
Management services on behalf of subsidiaries and sales transactions
Management services and other deliveries on behalf of subsidiaries, see note 19 ‘Investment in subsidiaries’, comprise NOK 65 million in 2021
(NOK 78 million 2020). Revenues, including reimbursables, related to DOF ASA Group comprises NOK 21 million in 2021 (NOK 23 million), of
which NOK 3 million in 2021 ( NOK 2 million) relates to management services.
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Guarantee agreement between subsidiaries and the Company
The Company has issued guarantees on behalf of subsidiaries. For further information about the guarantees, see note 22 `Guarantees`
Guarantee agreement between DOF ASA and the Company
The Company has in June 2010 entered into a guarantee agreement with DOF ASA. DOF ASA has provided a parent company guarantee for
obligations of DOF Subsea Brasil Serviços Ltda. and DOFCON Navegação Ltda. The basis for guarantee fee to DOF ASA amounts to USD 111
million at year-end (USD 119 million as of 31st of December 2020).
DOF Subsea AS has guaranteed for 50% of the obligations related to loans on the vessels in the joint venture. The Company has guarantee
commitments on behalf of DOFCON Brasil Group in favor of credit institutions of USD 345 million as per 31.12.2021, see also note 5 ‘ Financial
income and expenses’.
Non-current receivables against joint ventures
For information on non-current receivables against joint ventures, please see note 8 'Receivables from Group Companies and joint ventures'.
Please also see note 20 'Investments in joint ventures and associates' in the consolidated financial statements.
18 Remuneration to Board of Directors, Executives and Auditor
2021 2020
Remuneration to Executives CEO CFO CEO EVP
Salaries - 1.9 - 6.4
Management fee 3.5 - 4.9 -
Payment from DOF Subsea 3.5 1.9 4.9 6.4
CEO=Mons Aase, EVP=Jan Nore, CFO Martin Lundberg
Cost related to board fee to member of the board amounts to NOK 75,000.
In addition, the chairman Hans Olav Lindal has Invoiced for hour spend , in total NOK 864,675 is expensed in 2021.
Salaries include pension, bonuses and “other compensations” from the Group.
For additional information on employee benefits, please refer to note 31 “accounting policies”, paragraph Q.
A severance settlement for the agreed termination of the former CFO/EVP in 2020 have been paid upon completion of notice period in the end
of May 2021. Total compensation to the former CFO/EVP was NOK 9.06 million. The company loan to CFO/EVP was settled at the same time.
Martin Lundberg has held the position as CFO from 01.01. 2021.
A loan of NOK 2.5 million has been given to both the CEO and EVP in 2016. The loan to EVP was settled in 2021. The loan to the CEO is to
be settled in 2022. The annual interest on the loans are 2%. There is sucient security related to the loan. No other loans have been given to
or any security provided for the members of the Board of Directors, members of the Group management or other employees or close relatives
of the same Group.
Specification of Auditor’s fee 2021 2020
Fee for audit of financial statements 2.21 1.40
Fee for other attestation - -
Fee for other services 0.04 0.05
Total 2.25 1.45
DOF Subsea AS Amounts in NOK million
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19 Investments in subsidiaries
Subsidiary Registered office
Proportion of
ownership and
votes Cost price
Accumulated
impairment Booked value
DOF Installer ASA Austevoll, Norway 85% 859 -163 696
DOF Subsea Angola Lda Luanda, Angola 100% - - -
DOF Subsea Asia Pacific Pte Ltd Singapore 100% 678 -497 181
DOF Subsea Atlantic AS Bergen, Norway 100% 129 -129 -
DOF Subsea Brasil Serviços Ltda Macaé, Brasil 100% 706 -295 411
DOF Subsea Chartering AS Bergen, Norway 100% 89 - 89
DOF Subsea Congo S.A.
Pointe-Noire, Republice du Congo
55% - - -
DOF Subsea Rederi AS Bergen, Norway 100% 2 465 -914 1 552
DOF Subsea Rederi III AS Bergen, Norway 100% 486 -486 -
DOF Subsea ROV AS Bergen, Norway 100% 330 - 330
DOF Subsea US Inc. Houston, US 100% 423 -423 -
Total 6 164 -2 906 3 258
For 2021 a reversal of impairment in subsidiaries of NOK 652 million was recognised (2020 impairment loss of NOK 1,501 million) and is included
in the statement of comprehensive income as financial expenses. Please refer to note 5 ‘Financial income and expenses’.
20 Investments in joint ventures and associates
For further information on joint ventures and associates, please see note 28 ‘Investments in joint ventures and associates’ in the consolidated
financial statements.
Name of entity
Place of business/
country of
incorporation
% ownership
interest
Booked value
01.01.2021 Impairment
Booked value
31.12.2021
DOFCON Brasil AS Norway 50% 594 - 594
DOF Management AS Norway 34% 16 - 16
Marin IT AS Norway 35% 6 - 6
Master and Commander AS Norway 20% - - -
Total at 31.12.2021 615 - 615
21 Contingencies
The Company is not involved in any legal disputes or on-going legal matters involving potential losses, and therefore no provision has been made
for possible claims arising from the same.
22 Guarantees
Guarantees 2021 2020
Parent company guarantees 7 946 8 420
Total 7 946 8 420
Parent company guarantees are given to subsidiaries in the Subsea/IMR Projects segment and the Long-term Chartering segment. The guarantees
in the Subsea/IMR Projects segment are limited to the fulfilment of the construction contract and are released after delivery of the project. In
some cases there is a warranty period after delivery of the project. Normally this warranty period will have duration of 12-24 months and will
only be for a portion of the initial guarantee amount.
In addition, the guarantees are given in relation to financing of vessels. In 2021, the Company has recognised a liability of NOK 179 million
relating to vessel guarantees and financing of subsidiaries.
The Company has a tax deduction guarantee of NOK 3 million. Furthermore, guarantees to suppliers are given for fulfilment of payments for
deliveries of goods and services including vessels.
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DOF Subsea AS has guaranteed for 50% of the obligations related to loans on the vessels in the joint venture. The Company has guarantee
commitments on behalf of DOFCON Brasil Group in favor of credit institutions of USD 345 million as per 31.12.2021, see also note 5 ' Financial
income and expenses'.
23 Earnings per share
Basis for calculating earnings per share 2021 2020
Profit / loss attributable to shareholders of the Company 362 -2 339
Weighted average number of outstanding shares 31.12 167 352 762 167 352 762
Weighted average number of outstanding shares 31.12, diluted 167 352 762 167 352 762
Basic and diluted earnings per share (NOK) 2.16 -13.98
24 Share capital and share information
Share capital
The share capital in DOF Subsea AS at 31.12.2021 was NOK 1,674 million comprising 167,352,762 shares, each with a nominal value of NOK 10.00.
Shareholder overview
Shareholders at 31.12.2021 No. of shares Proportion of ownership Share capital
DOF ASA 100% 100%
Total 100% 100%
Board of Directors Title
Hans Olav Lindal Chairman
Helge Singelstad Director
Marianne Møgster Director
Harald Lauritz Thorstein Director
Kathryn Moore Baker Director
Executives Title
Mons S Aase CEO
Marin Lundberg
CFO
The Company is a part of DOF ASA Group. Please refer to the DOF ASA annual report for shares held in DOF ASA by the management and the
Board of Directors. The annual report is published at www.dof.com.
25 Events occurring after period end
Finance
On 31st of March 2022, DOF ASA and DOF Subsea AS have agreed to further extend the principal and interest suspension agreements with, or
received extensions of similar concessions from, secured lenders representing in total 95% of the secured debt of companies within the DOF Subsea
AS group (excluding DOF Subsea Brasil Servicos Ltda.) until the 30th of April 2022. The bondholders in DOF Subsea have further in a meeting on
31st of March 2022 approved extension of the standstill agreement until 30th of April 2022. The extensions of the standstill periods will facilitate the
Group’s continued dialogue with its secured lenders and the bondholders under the Company’s bonds regarding a long-term financial restructuring
of the Group and Company.
Invasion of Ukraine
The global community is witnessing the escalating invasion in Ukraine, and the Company see the repercussions of fractured tensions in international
cooperation. However, the Company has not identified any potential exposure to assets or operations in Eastern Europe, specifically Ukraine and Russia.
DOF Subsea AS Amounts in NOK million
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Minority interest in DOF Installer ASA
In 2022 DOF Subsea AS has sent an oer to the minority shareholders in DOF Installer ASA to buy the remaining 15.08 % of the company at a
price of 4.35 per share.
26 Accounting policies
Summary of significant accounting principles
The financial statements of the Company have been prepared in accordance with the Norwegian Accounting Act § 3-9 and Finance Ministry’s
prescribed regulations from 21st of January 2008 on simplified IFRS. Principally, this means that recognition and measurement comply with the
International Financial Reporting Standards (IFRS) and presentation and note disclosures are in accordance with the Norwegian Accounting
Act and generally accepted accounting principles. The financial statements have been prepared in accordance with the historical cost convention
with the following exceptions: available-for-sale financial assets and financial instruments at fair value through profit or loss are subsequently
carried at fair value. The fiscal year is the same as the calendar year.
Operating revenue
Operating revenue from management services is recognised when it is probable that transactions will generate future economic benefits that will
flow to the Company, and the amount can be reliably estimated. Operating revenue is presented net of value added tax and discounts.
Investment in subsidiaries, joint ventures and associated companies
Investments in shares are based on the cost method.
Dividends
Dividends and Group contributions are accounted for according to IFRS. Dividends and Group contributions are recognised when approved by
the General Assembly.
For further information, reference is made to the consolidated financial statements.
DOF Subsea AS Amounts in NOK million
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We confirm, to the best of our knowledge, that the financial statements for the period from 1st of January to 31st of December
2021 have been prepared in accordance with approved accounting standards, and give a true and fair view of the Group’s and
the Company’s assets, liabilities, financial position and result of operations and that the report of the Board of Directors
provides a true and fair view of the development and performance of the business and the position of the Group and the
Company together with a description of the key risks and uncertainty factors that the Group and the Company are facing.
Confirmation from the Board of Directors and CEO
Kathryn M. Baker
Director
Hans Olav Lindal
Chairman
Helge Singelstad
Director
Mons S. Aase
CEO
Harald Thorstein
Director
Bergen, 6th of April 2022
The Board of Directors of DOF Subsea AS
Marianne Møgster
Director
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financial statements / independent auditor’s report
PricewaterhouseCoopers AS, Sandviksbodene 2A, Postboks 3984 - Sandviken, NO-5835 Bergen
T: 02316, org. no.: 987 009 713 MVA, www.pwc.no
Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap
To the General Meeting of DOF Subsea AS
Independent Auditor’s Report
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of DOF Subsea AS, which comprise:
• The financial statements of the parent company DOF Subsea AS (the Company), which
comprise the statement of financial position as at 31 December 2021, statement of
comprehensive income, statement of changes in equity and statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies, and
• The consolidated financial statements of DOF Subsea AS and its subsidiaries (the Group),
which comprise the statement of financial position as at 31 December 2021, statement of
comprehensive income, statement of changes in equity and statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies.
In our opinion:
• the financial statements comply with applicable statutory requirements,
• the financial statements give a true and fair view of the financial position of the Company as at
31 December 2021, and its financial performance and its cash flows for the year then ended in
accordance with simplified application of international accounting standards according to
section 3-9 of the Norwegian Accounting Act, and
• the financial statements give a true and fair view of the financial position of the Group as at 31
December 2021, and its financial performance and its cash flows for the year then ended in
accordance with International Financial Reporting Standards as adopted by the EU.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Financial Statements section of our report. We are independent of the Company and the
Group as required by laws and regulations and the International Ethics Standards Board for
Accountants’ International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in
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accordance with these requirements. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for 17 years from the election by a general meeting of the
shareholders in 2005 for the accounting year 2005 with a renewed election on the 27.05.2021.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 in the financial statements and the Board of Directors’ report, which
indicates that the Group is dependent on a long-term solution with banks and bondholders to secure
satisfactory financing and liquidity for the Group. As stated in Note 1 and the Board of Directors’
report, these events or conditions, along with other matters as set forth in Note 2 and Note 30 and the
Board of Directors’ report, indicate that a material uncertainty exists that may cast significant doubt
on the Company’s ability to continue as a going concern. There is a risk that the Group will not reach
an agreement with the lenders, and in such an event the Group could be forced to realise its assets at a
significantly lower value than their carrying amount. Our opinion is not modified in respect of this
matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period. These matters were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters. In addition to the matter described in the Material
Uncertainty Related to Going Concern section, we have determined the matters described below to be
the key audit matters to be communicated in our report.
The Group’s business activities are largely unchanged compared to last year. Impairment assessment
of vessels and vessel related equipment involves similar complexity and risks as previous years and
have been considered as key audit matters also for 2021.
Key Audit Matter How our audit addressed the Key Audit Matter
Impairment assessment of vessel and
vessel related equipment
DOF Subsea AS Group has vessels and
vessel related equipment with a carrying
amount of NOK 7 226 million at 31
December 2021. In line with the Group’s
accounting policy for impairment of non-
financial assets, the Board of Directors
has assessed that there were impairment
indicators present for the Group’s vessels
as of 31 December 2021. Consequently,
they have carried out an impairment
assessment. Based on the results of the
We obtained management’s impairment model and
considered whether the model contained the elements
and methodology IFRS require from such models. We
found the model to be in accordance with our
expectations.
We challenged management’s key assumptions such as
the projected utilisation, charter hire rates, operating
expenses and discount rates, and compared with
historical performance, management’s internal
forecasts and long-term strategic plans that were
approved by the Board of Directors. We also considered
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vessel impairment assessments, a net
impairment charge of NOK 172 million
including a reversal of impairment of
NOK 30 million related to disposal of a
vessel was recognised in 2021 resulting in
the carrying amounts of certain vessels
being written down to their recoverable
amount. In addition, joint venture vessels
have been impaired, whereas DOF Subsea
AS 50% share represent NOK 98 million
in 2021.
We focused on this area because vessels
and vessel related equipment constitute a
significant share of the total assets in the
Group, and because the assessment of the
recoverable amount is complex and
involves significant management
judgement.
Value-in-use (“VIU”) for the vessels was
estimated using discounted cash flows.
Each individual vessel, together with
associated contract, was assessed as a
separate cash generating unit. Significant
management judgement was related to
key assumptions such as utilisation,
charter hire rates, operating expenses and
discount rates.
Fair value less costs to sell (“FVLCS”),
was estimated by obtaining professional
valuations for each vessel from two well-
reputed and independent brokers, taken
into account estimated sales commission.
The uncertainty related to valuation of
the company’s vessels and vessel related
equipment are considered to be high due
to the challenging market conditions.
We refer to Notes 3 and 31 for the Group’s
accounting policy for impairment of non-
financial assets, and Note 11 where the
Board of Directors explain their valuation
process for the Group’s tangible assets.
publicly available information about macroeconomic
assumptions relevant to the industry and considered
whether the assumptions where consistent with
management assumptions and what we know about
DOFs business. We found management’s assumptions
to be within a reasonable range.
To consider the reliability of management forecast, we
compared previous year’s estimates to actual historical
performance. We considered whether deviations from
the budget had reasonable explanations. We assessed
the discount rate by comparing key components used
with external market data, as well as comparing the
overall level with discount rates used by other
companies within the industry. We considered that the
discount rates were within an appropriate range.
We evaluated the competence and objectivity of the
external brokers used by the Group. The range of values
derived from the two independent brokers were
compared with the VIU estimates. We considered the
appropriateness and reliability of the fair value
estimates from the external brokers. We were able to
conclude that the broker estimates were appropriate as
audit evidence. However, for some of the vessel
categories we have observed larger spread in the broker
estimates recent years, which indicate higher
uncertainty in the valuations. Therefore, management
has found it necessary to substantiate the broker
valuations with VIU calculations and tests of
reasonableness. We found that none of the vessels,
after impairment, had a carrying value that was
materially higher than their VIU estimates.
We lastly evaluated the adequacy of the disclosures
made on impairment of vessel and vessel related
equipment, including those regarding key assumptions
and sensitivities, and found that disclosures
appropriately explained management’s valuation
process and the uncertainties inherent in some of
management’s key assumptions.
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information
in the Board of Directors’ report and the other information presented with the financial statements.
The other information comprises information in the annual report, but does not include the financial
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Independent Auditor's Report - DOF Subsea AS
(4)
statements and our auditor’s report thereon. Our opinion on the financial statements does not cover
the information in the Board of Directors’ report and the other information presented with the
financial statements.
In connection with our audit of the financial statements, our responsibility is to read the Board of
Directors’ report and the other information presented with the financial statements. The purpose is to
consider if there is material inconsistency between the Board of Directors’ report and the other
information presented with the financial statements and the financial statements or our knowledge
obtained in the audit, or whether the Board of Directors’ report and the other information presented
with the financial statements otherwise appears to be materially misstated. We are required to report if
there is a material misstatement in the Board of Directors’ report and the other information presented
with the financial statements. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report
• is consistent with the financial statements and
• contains the information required by applicable legal requirements.
Our opinion on the Board of Director’s report applies correspondingly for the statements on Corporate
Governance and Corporate Social Responsibility.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in
accordance with simplified application of international accounting standards according to the
Norwegian Accounting Act section 3-9, and for the preparation and true and fair view of the
consolidated financial statements of the Group in accordance with International Financial Reporting
Standards as adopted by the EU, and for such internal control as management determines is necessary
to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to
liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional scepticism throughout the audit. We also:
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Independent Auditor's Report - DOF Subsea AS
(5)
• identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error. We design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The
risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's or the Group's internal control.
• evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• conclude on the appropriateness of management’s use of the going concern basis of
accounting, and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company and the
Group's ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in
the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Company and the Group to cease to
continue as a going concern.
• evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves a true and fair view.
• obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group
audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
From the matters communicated with the Board of Directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
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Independent Auditor's Report - DOF Subsea AS
(6)
Report on Other Legal and Regulatory Requirements
Report on compliance with Regulation on European Single Electronic Format
(ESEF)
Opinion
We have performed an assurance engagement to obtain reasonable assurance that the financial
statements with file name “DOF Subsea AS – ESEF Annual reporting 2021” have been prepared in
accordance with Section 5-5 of the Norwegian Securities Trading Act (Verdipapirhandelloven) and the
accompanying Regulation on European Single Electronic Format (ESEF).
In our opinion, the financial statements have been prepared, in all material respects, in accordance
with the requirements of ESEF.
Management’s Responsibilities
Management is responsible for preparing, tagging and publishing the financial statements in the single
electronic reporting format required in ESEF. This responsibility comprises an adequate process and
the internal control procedures which management determines is necessary for the preparation,
tagging and publication of the financial statements.
Auditor’s Responsibilities
For a description of the auditor’s responsibilities when performing an assurance engagement of the
ESEF reporting, see: https://revisorforeningen.no/revisjonsberetninger
Bergen, 6 April 2022
PricewaterhouseCoopers AS
Sturle Døsen
State Authorised Public Accountant
(This document is signed electronically)
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DOF is a values-driven company operating in the offshore en ergy
sector, where energy production is transitioning to cleaner solutions
and renewables. To be a sustainable, investible company our business
platform must reflect stakeholders’ expectations, future market
demand for the skills and potential of our people and our assets.
PrinciplesPrinciples
SAFE, LEGAL, ETHICAL DECISIONMAKING,
EVERYWHERE WE DO BUSINESS
GRI-201 Economic Performance
GRI-204 Procurement practices
GRI-205 Anti-corruption
GRI-206 Anti-competitive behaviour
GRI-407 Freedom of association and
collective bargaining
GRI-409 Forced or compulsory labour
GRI-411 Rights of indigenous peoples
GRI-414 Supplier social assessment
GROUP
Environmental, Social and Governance commitments
ProsperityProsperity
GOOD CORPORATE CITIZENS, EFFICIENT
OPERATIONS, POSITIVE IMPACTS
GRI-202 Market Presence
GRI-207 Tax
GRI-413 Local communities
DOF-1 Customer feedback
DOF-2 Product reliability
DOF-3 Risk balancing
THE
Planet
TRANSPARENCY, ENVIRONMENTAL
STEWARDSHIP & SUSTAINABLE SOLUTIONS
TO REDUCE OUR IMPACT
GRI-302 Energy
GRI-305 Emissions
GRI-306 Waste
GRI-308 Supplier environmental
assessment
PeoplePeople
A SAFE, INCLUSIVE,
INSPIRING WORKPLACE:
GRI-401 Employment
GRI-402 Labour/management relations
GRI-403 Occupational health and safety
GRI-404 Training and education
GRI-405 Diversity and equal opportunity
GRI-406 Non-discrimination
GRI-415 Public policy
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Contents
Introduction 128
Measuring our results & setting ambitions
People 134
Planet 142
Prosperity 150
Principles 156
Appendix B 166
GRI Content Index 166
Materiality 176
Enterprise Risk Management 178
Value driver results 180
Figures & tables 182
Figure overview 193
Independent auditor's report 194
2021
DOF ESG FACTBOOK *
The results in this section of the DOF Subsea
annual report are aggregated from the parent
company level and include both DOF Subsea
and other DOF ASA subsidiaries.
*
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Welcome to our 2021
ESG factbook
Providing detailed non-financial performance data on key ESG indicators
The content contained in this factbook is organised around the World
Economic Forum’s framework: People, Planet, Prosperity, Principles.
Within each area, it is also described how the DOF values relate to the
area. The ESG factbook supports the statements and ambitions stated
in the DOF Integrated Annual Report 2021.
As DOF’s sustainability efforts evolve, expand, and become more
comprehensive, so too do our stakeholders and their material interest
in our activities. It is therefore of the utmost importance that DOF has
eective mechanisms and reporting structures to communicate financial
and non-financial information to these interested parties.
The content contained in this factbook is
organised around the World Economic Forum’s
framework: People, Planet, Prosperity, Principles.
Within each area, it is also described how the
DOF values relate to the area. The ESG factbook
supports the statements and ambitions stated
in the DOF Integrated Annual Report 2021.
This year, DOF has adopted the World Economic
Forum’s Stakeholder Capitalism Metrics of; People,
Planet, Prosperity and Principles.
Not only does this framework compliment DOF’s
vision of creating broad stakeholder value, but
it promotes a core set of non-financial metrics
and disclosures for investors and stakeholders
alike. DOF is committed to the pillars of People,
Planet, Prosperity and Principles and believes
this concept is integral to future sustainability
initiatives and communication.
The following ESG Factbook supports the DOF
Integrated Annual Report 2021 by providing
verifiable and where possible, quantifiable data
points, assuring the legitimacy of our statements
and ambitions.
DOF has reported in the areas of sustainability
to the GRI standards measuring Economic,
Environment, and Social aspects for eight years.
This, along with our participation in Carbon
Disclosure Project over the last eleven years,
has driven engagement with stakeholder groups
and improved both management and performance
in these areas.
In 2021, we made further progress in transparency
and integrated reporting as DOF adopts the
World Economic Forum's 4-pillar approach,
bringing all the measures of stakeholder value
together, aligning the non-financial reporting
with financial reporting. Our vision and strategic
ambitions are set out in this integrated report.
This report format aims to communicate to all
stakeholders, underpin change, and outline targets
and measures for the next strategic period.
This document can be found in digital format on our
website: www.dof.com/sustainability.
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Respect, Integrity, Teamwork, Excellence.
Above all we are Safe.
Safety is at the centre of business and the icon.
This illustrates how our values interact to keep us
safe. How the Team embraces the values and holding
them together is symbolised by people holding hands
around the values.
Safe the RITE way
Safeguarding our people, the environment, and communities
where we operate is our highest priority.
Safe the RITE way
Applying our values to define significance,
guide our approach, assess our results and
set the ambitions into our future.
DOF is a values-driven organisation with world-
class social, environmental, ethical and governance
standards. Our actions and decisions are always
guided by and grounded in our values. Our
ability to engage with stakeholders, identify
material issues and manage material risk is key
to the sustainability of the organisation. Our
values underpin our approach to Sustainability,
from identifying material issues – the issues
that impact the business and are important
to stakeholders – to setting the ambitions for
our future.
Safety is at the centre of business and the icon.
This illustrates how our values interact to keep
us safe. How the Team embraces the values and
holding them together is symbolised by people
holding hands around the values.
Why are we a "values-driven" organisation?
In business ‘the only constant is change’.
The advantage of having a solid set of beliefs
and values is that the organisation can adapt
rapidly to situational or commercial change, but
always with an anchor of beliefs and values.
This is the essence of a sustainable organisation;
where our values guide our actions to respond
to relevant economic, environmental and social
factors. We meet stakeholder expectations and
navigate daily challenges, large and small, by
having a deep understanding of our values, clear
priorities and reporting mechanisms. “What we
do is as important as the way in which we do it.”
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This table shows how DOF connects
material aspects to key stakeholders
and our company values:
Safe, Respect, Integrity, Teamwork,
& Excellence.
Creating value
for all of our
stakeholders
People
SAFE
Above all we are SAFE
TEAMWORK
Respect for people: our colleagues, our customers,
our business partners and our environment.
TEAMWORK
We build diverse and global teams and strive
for free exchange of ideas, experience
and knowledge, worldwide.
* Material issues identification is
aligned with the GRI Standards
p High importance to DOF
r Medium importance to DOF
r Business Ethics
p Employee HSE
p Labour Practices
p GRI-401 Employment
p GRI-402 Labour/management relations
p GRI-403 Occupational health and safety
p GRI-404 Training and education
p GRI-405 Diversity and equal opportunity
p GRI-406 Non-discrimination
r GRI-415 Public policy
MATERIAL TOPICS (GRI)MATERIAL TOPICS (GRI)
MATERIAL ISSUES (DOF*)MATERIAL ISSUES (DOF*)
Global: Employees, shareholders, customers, local com-
munities, NGOs, policy makers, shareholders, suppliers
OUTSIDE THE ORGANISATIONOUTSIDE THE ORGANISATION
Whole organisation: DOF's ambition is to be an
incident-free organisation. We are highly committed
to our core values – Safe the RITE way - and we
work pro-actively to achieving them.
Safe is significant to DOF and is paramount to our
ongoing success and sustainability, we work to
ensure we are safe and our team returns safely,
everywhere we do business.
WITHIN THE ORGANISATIONWITHIN THE ORGANISATION
Safeguarding our people is the overall objective in
everything we do. Through the Safe the RITE way
framework, DOF has ambition to ensure the good
health and well-being of all employees. Measurable
key performance indicators are used as part of this
work, to monitor the effect of the activities performed
within the area.
The DOF Workbook includes a module on Physical,
Social and Mental well-being, which puts the differ-
ent aspects of health together in a holistic approach.
Our continuous efforts on simplification of our
safety system and procedures aim to turn the focus
from the industry’s inbuilt bureaucracy, back to
enhanced safe work practices.
UN SDGUN SDG
Gauging ripple effects from COVID-19
We have experienced first-hand the fallout of
COVID-19 and all the economic and social
consequences that come with it.
Like many other World Economic Forum Global
Risk Perception Survey respondents, DOF’s activities
are subject to disparities in COVID-19 political
responses and divergent economic recovery rates.
The economic, geopolitical, public health and
societal fractures that the pandemic risk has
accelerated are reported as something likely to
delay the business communities’ response to other
global challenges such as climate response, the
greening of energy systems, addressing digital
vulnerabilities, and social degradation. Whilst
the WEF reports these as ‘Global Challenges’,
our internal workshops translate these topics
as material issues to DOF.
Read more about DOF's materiality approach
on page 182 of the appendecies.
COMPANY VALUESCOMPANY VALUES
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Planet
RESPECT
Respect for people: our colleagues,
our customers, our business partners,
and our environment.
p Energy Management
p GHG Emissions
p Supply Chain Management
r Waste & HAZMAT Management
p GRI-302 Energy
p GRI-305 Emissions
r GRI-306 Waste
p GRI-308 Supplier environmental assessment
Global: Customers, civil society, policy makers,
local communities, NGOs, shareholders
Whole organisation: Defining and measuring environ-
mental sustainability risks associated with our
business activities is an important activity for the
Group. DOF is actively working with its partners on
finding energy efficient and CO2 reducing solutions
as part of their own efforts to reduce carbon footprint.
The main source of DOF’s climate impact is the
fuel used by its vessels. DOF has various activities
and programs to reduce its climate impact, includ-
ing; Ship Energy Efficiency Plans (SEEMP), goal of
3% annual reduction (intensity target) in fuel con-
sumption, installation of shore power capability,
installation of battery packs on vessels, and partic-
ipation in the CDP for transparent environmental
reporting.
Through an R&D project with Kongsberg, we aim to
use digital solutions to reduce energy usage on our
vessels, through Intelligent Efficiency. There is poten-
tial for 15%-30% reduction in fuel consumption,
ultimately leading to significant reduction in emissions.
DOF also has other internal activities such as
preparedness for acute pollution from vessels,
using environmentally friendly products (for example
non-hazardous hydraulic oil in ROVs) and environ-
mental management plans.
Prosperity
EXCELLENCE
Excellence in everything we do.
We are resourceful and responsive to
our customers’ needs: innovative in the solutions
we apply to everyday problems.
Principles
INTEGRITY
Integrity is the very corner stone
of our business.
We behave ethically – always.
p Business Model Resilience
r Human rights & Community Relations
r Product Design and Life Cycle
p GRI-202 Market Presence;
p GRI-207 Tax;
r GRI-413 Local communities;
r DOF-1 Customer feedback;
r DOF-2 Product reliability;
p DOF-3 Risk balancing
r Business Ethics
p Business Model Resilience
r Human rights & Community Relations
p Supply Chain Management
p GRI-201 Economic Performance;
p GRI-204 Procurement practices;
r GRI-205 Anti-corruption;
r GRI-206 Anti-competitive behaviour;
p GRI-407
Freedom of association and collective bargaining;
p GRI-409 Forced or compulsory labour;
r GRI-411 Rights of indigenous peoples;
p GRI-414 Supplier social assessment
MATERIAL TOPICS (GRI)MATERIAL TOPICS (GRI)
MATERIAL ISSUES (DOF*) MATERIAL ISSUES (DOF*)
Global: Customers, civil society, shareholders,
suppliers, policy makers, civil society
Global: Employees, shareholders, customers, local com-
munities, NGOs, policy makers, shareholders, suppliers
OUTSIDE THE ORGANISATIONOUTSIDE THE ORGANISATION
Whole organisation: For DOF, business integrity and
ethics policy are of high priority and DOF expects
their companies and employees to follow and adopt
behaviours to protect and build the DOF’s reputation,
in all situations.
For DOF to be in compliance to law and to industry
standards is of strategic priority. In all of the regions
where DOF operates, it strictly follows all rules and
regulations addressed by the national governments.
DOF acknowledges the importance for our custom-
ers of a reliable partner and that is why we are always
seeking to obtain the highest industry standard
certifications before accredited bodies.
Whole organisation: DOF understands that acting
in accordance with its Code of Business Conduct
towards their partners and employees is decisive
in achieving the highest standards by which DOF
conducts their business activities every day.
WITHIN THE ORGANISATIONWITHIN THE ORGANISATION
By employing local content, DOF contributes to
economic growth in the various areas of operation.
DOF is also committed to operating responsibly and
respecting local laws and regulations. Through its
Tax Strategy, DOF ensures that tax is paid fairly to
the countries where it operates.
DOF acts ethically and lawfully to protect our rep-
utation and comply with applicable laws and regu-
lations, wherever we do business.
Our Code of Business Conduct gives us clear rules
and provides guidance for decision-making in ethical
dilemmas. This is particularly important when operat-
ing in areas with high risk related to Anti-Bribery and
Corruption. DOF has established an Ethics Helpline
where both employees and any other stakeholders
can report by a phone available 24/7, or through an
online form. Reports can be made anonymously.
DOF’s focus towards Integrity is not limited to
ourselves; we strive to ensure that our partners and
suppliers operates according to the same standards,
for example by assessing all suppliers towards the
principles of the UN Global Compact.
DOF operates in many different areas around the
world, and some of these areas lack a strong
public education system. Either by direct contribu-
tion to employees or partnerships with other
members of the industry, DOF contributes to
quality education of children in challenging areas.
The DOF Workbook gives the foundation for train-
ing in the years to come. By delivering training
modules on all aspects of how we work, we have
established a unique way to engage training and
development of our people.
DOF strives to promote a workplace where all are
treated fairly, accepted equally, without any exclusion
- in a harassment-free workplace. As a Group, we
benefit from the different talents, experiences and
perspectives equality and diversity brings to the
workplace and the individual contribution employees
make. Our guiding principle is that everyone should
be treated with dignity and respect at work.
UN SDGUN SDG
COMPANY VALUESCOMPANY VALUES
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People
Company values that are directly connected to people:
SAFE, RESPECT, TEAMWORK
Safeguarding people is our highest priority. The Group has built on the Safe the RITE way program,
strengthening our global safety culture. We work continuously to improve safety systems and our
safety performance. DOF core values act together to create a strong safety culture and deliver our
highest priority: “Above all we are Safe”. We work to ensure we are safe, and our team return
home safely, everywhere we do business. Protecting the health and safety of our people and our
environment is a fundamental requirement of business as it is paramount to DOF’s on-going success
and sustainability. It is a material issue and a right that all employees, their families, our whole
supply chains, clients, investors and regulators expect to be sustained. It is essential to winning
business and attracting recruiting and retaining talented employees. We work to ensure we are
safe, and our team return home safely, everywhere we do business. Cyber security, securing our
Information Technology (IT), and Operation Technology (OT) infrastructure and preventing cyber-
attacks, is also an important aspect of our business and sits within our definition of SAFE.
“Respect underpins everything we do and every interaction we have. Respect for people: our
colleagues, our customers, and our business partners. As global citizens we are socially responsible,
we respect the individual, the local customs and cultures of our various markets. Acting with care
and consideration is central to our wellbeing and safety and ensures we minimise our environmental
impact.” The Group aims to create an environment of empathy, mutual respect and understanding
amongst all stakeholders. DOF is an equal opportunity employer and does not tolerate any form
of harassment or discrimination within the workplace or local communities where we operate. We
operate in an evolving market. It is vital for DOF to develop in the energy sector, together with
our key partners, in line with the targets articulated in UN’s Sustainable Development Goals. As a
responsible organisation and through Respect we aim to maintain our equal opportunity employer
performance: we will not tolerate any form of harassment or discrimination within the workplace.
According to the DOF values: “Everything we achieve is as a result of teamwork. Each of us is
responsible and open in our professional relationships, co-operative and collaborative, treating one
another with dignity and respect. We do not blame; we find and share solutions and we learn from
mistakes. From this platform we build diverse and global teams and strive for free exchange of
ideas, experience and knowledge, worldwide.” Companies are their People. Collaboration between
team members is a key success factor for DOF. Teams, at every level of the organisation, have built
the professional and respected company we are today.
In turn, working for a values-driven company,
oering fair work, with career development and team environment creates an engaged workforce which
benefits customers, investors, and suppliers. Training and careers programs benefit local communities.
DOF is committed to building strong and capable teams, through training and developing of key
employees, either as part of important teams, or as potential leaders.
Within People, we apply our values
to define significance,
guide our approach, assess our results, and set the ambitions into our future.
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2021
2021 activities within People
COVID recovery
During the entire year tremendous eorts and sacrifices has
been done to protect our crew and employees towards COVID-
19. Continuously and changing regulations and demands
from government and health authorities all over the world,
has loyally been followed by our employees in a stoic and
understandable way. Despite all of eorts and precautions,
several employees ended in CRU units for months. How-
ever, all are now out of hospitals and are now supported by
Company and health professionals to get back at work. The
biggest challenges have been to support and facilitate pro-
tocols and follow up of our employees in Brazil.
At the end of the year when the Company started to prepare
for a normalisation, the new OMICRON variant hit us hard
with hundreds of employees infected. Nevertheless, due to
high vaccinations rate in DOF, the impact and symptoms of
the infection was greatly reduced in most cases.
DOF will in future handle COVID-19 outbreak as an influ-
enzas like infection and be guided by our medical protocols
oshore and HR handbooks onshore and loyal follow advice
directed by WHO and regional legislation.
Social
DOF’s strong standards within the social dimension of business
aligns with UN's Global Compact and Sustainable Develop-
ment Goals. This ensures decent work, generates wealth for
employees, local communities, and along our supply chain
as well as wider society by generating taxes.
Health, Safety, and Security
Protecting the health and safety of our people and our envi-
ronment is a fundamental requirement of business as it is
paramount to DOF’s on-going success and sustainability. It
is a material issue and a right that all employees, their fami-
lies, our whole supply chains, clients, investors and regulators
expect to be sustained. It is essential to winning business
and attracting recruiting and retaining talented employees.
We work to ensure we are safe, and our team return home
safely, everywhere we do business.
DOF’s approach to Health, Safety and Security from a sus-
tainability perspective aligns closely with how this is managed
operationally.
Labour and Human Rights
DOF follows the Norwegian Shipowners Association’s approach
to Labour and Human Rights in our industry:
The main concern is possible non-compliance with general
labour and human rights standards, particularly related to
the use of short-term contracts and temporary employment
through manning agencies, which may weaken worker’s rights.
Several cases of modern slavery have been uncovered in the
value chain in recent years, particularly involving migrant
workers at yards.
2.05
per million man-hours
TRIR
TRIR (Total recordable injuries rate) in 2021
0.68
per million man-hours
LTIFR
LTIFR (Lost time injury frequency rate) in 2021
Balanced KPIs
DOF has established nine KPIs within
Safety, balancing leading and lagging
indicators.
Ambitious targets
"This is an incident-free organisation"
New insights
DOF is utilising a data warehouse
solution and Power BI, to enable a deeper
insight and analysis of our numbers.
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2021
The Norwegian parliament has adopted the Transparency
Act, obliging large and mid-size companies to conduct human
rights and decent work due diligence not only for its own
operations and supply chain, but throughout all business
relationships in the value chain. Under this Act, citizens will
be entitled to request information from companies, and the
Norwegian consumer authority may issue injunctions and
fines for non-compliance. Reporting should cover how the
company approaches labour and human rights for its own
employees, as well as in the value chain, particularly related to
contracted workers and yard workers for newbuilds and ship
recycling. DOF will in 2022 ensure that relevant governing
documents and processes are aligned with the Transparency
Act requirements.
DOF will in 2022 support roll-out of Amnesty’s eLearning
course on Business and Human Rights. The course will be
mandatory for positions in DOF that are exposed to issues
related to Human Rights.
Human Rights Due Diligence
DOF currently has a template for “Company Analysis and
Due Diligence Report”. This template will be reviewed to
ensure the parts covering Labour and Human Rights are
aligned with new requirements.
Diversity
Over the last few years, the Group have identified increas-
ingly stricter requirements for reporting on various aspects of
workplace diversity. In 2022, systematic work will be initiated
to get an overview of these changes and develop a guideline
on how to measure various aspects of diversity. This could
include (but not limited to) wages, training, career paths and
management positions. The work will be basis for a more
structured approach to this area in the future.
As part of the DOF Ambassador program, one of the work-groups
have been assigned a strategic project related to diversity in DOF.
Occupational Health & Safety management
DOF is committed to ensuring the provision of a healthy and
safe working environment throughout company operations,
through interaction and consultation with stakeholders.
The Occupational Health & Safety management is verified by
DNV according to requirements in the ISO 45001 standard
and the ISM code and forms a part of the Business Man-
agement System (available on www.dof.com).
• The Occupational Health and Safety Manual (OH&S) is in
line with international standards such as ISO 45001 and
the ISM code.
• DOF has established procedures to ensure that hazards are
identified, the likelihood and consequence of occurrence is
assessed and, as necessary, suitable control measures are
introduced along ALARP principals.
• Personnel are trained in the use of appropriate risk
assessment and management techniques.
Hazard identification, risk assessment, and incident
investigation
DOF implements a hazard and risk management process in
order to identify hazards and risks associated company activ-
ities - aligned with ISO 31000 Risk Management - Principles
and Guidelines:
• Risk assessment processes are audited by internal and
external parties such as DNV;
• All employees must undertake basic training in risk iden-
tification and assessment;
• All employees have the Stop Work Authority;
• Incident investigation depends on the level of severity of
the incident and is published in the DOF Workbook;
• All investigations conclude with recommendations in the
occupational health and safety management system.
Occupational health services
DOF has an agreement with an internationally recognised,
accredited occupational health service provider. Services can be
accessed directly or through positions such as a vessel’s nurse.
Worker participation, consultation, and communication
on occupational health and safety
• DOF’s OH&S management system IT application allows for
feedback directly on specific documents, or to make general
improvement suggestions.
• Safety Delegate & Protection and Environment Committee
(PEC) committees at vessels and onshore worksites guarantee
worker involvement. These committees may vary depending
on local legislation.
The Norwegian Maritime Cyber Resilience Centre - NORMA Cyber is a joint effort
between Den Norske Krigsforsikring for Skib (DNK) and the Norwegian Shipowners’
Association and started operations from the 1st of January 2021.
The centre delivers centralised cyber security services to Norwegian shipowners and
other entities within the Norwegian maritime sector. NORMA Cyber aims to be the
leading hub for operational cyber security efforts within the Norwegian maritime sector.
NORMA Cyber
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Worker training on occupational health and safety
All workers are required to perform mandatory e-learning
related to Risk Assessment and the Permit to Work system,
which are fundamental to safeguarding our people.
Promotion of worker health
DOF aims to ensure that all employees have access to non-oc-
cupational medical and healthcare services. This is normally
achieved through agreements with local health insurance com-
panies. The coverage of these insurances will be adapted to
circumstances such as availability of universal health care
and statutory requirements. Overall, DOF follows an indus-
try benchmark for its health insurance coverage.
In some regions, programs have been established for volun-
tary health promotion services such as annual health check-up.
Prevention and mitigation of occupational health and safety
impacts directly linked by business relationships.
DOF’s oshore operations are where our people have the high-
est exposure to health and safety risks. The Permit to Work
system identifies high risk operations. The system ensures a
thorough process before work may commence and includes
risk assessment for the specific work to be done.
Workers covered by an occupational health and safety
management system
All employees at DOF vessels and worksites are covered by
the Occupational Health and Safety management system. This
includes both employees and workers who are not employees.
By 31.12.2021 the headcount of DOF sta was 3,820 people. An
exact number of workers who are not employees is not available.
In addition to regular internal audits, the OH&S Manage-
ment system is verified by DNV according to requirements
in the ISO 45001 standard and the ISM code.
Cyber security
Cyber security is our practice of defending computers, serv-
ers, mobile devices, electronic systems, networks, and data
from malicious attacks. Our defence of the Group IT and OT
infrastructure is guided by our global Cyber Risk Manage-
ment standard, built around but not limited to:
•
Network security by online monitoring securing DOF's com
-
puter network from intruders, whether targeted attackers
or opportunistic malware.
•
Application security by design is focused on keeping software
and devices free of threats.
• Information security protects the integrity and privacy of
data, both in storage and in transit.
•
Operational security processes are in place for handling and
protecting data assets in a best possible way.
•
Disaster recovery and business continuity plans are in place to
dictate how the business restore any loss of operations or data
and to return to the same operating capacity as before an attack.
• End-user education is in place to teach our employees
to detect secure suspicious e-mails and behave like data
security ocers on behalf of our Company.
• DOF is part of NORMA Cyber including services like intelli-
gence, security operations and crisis response. Regular ERT
exercises are executed to be prepared and respond to attacks.
Respect for each other and cultural diversity
Respecting cultural diversity while working towards the
same goals is a key success factor for DOF. All DOF employ-
ees undertake mandatory and regular values-based training.
The Code of Business Conduct (COBC) is in place to guide
behaviour and support sound judgement and common sense
and DOF’s values are embedded in many other business and
discipline related training materials.
Robust, respectful and healthy communication between our
people in the Group, across geographical borders and “top-
down – bottom-up” is valued.
Labour rights & relations (employee satisfaction)
DOF is committed to encourage and support all employees
and ensure all employees align with DOF’s vision and val-
ues. DOF aims to perform working environment surveys
every second year, followed by improvement process until
the next survey. A survey is planned for 2022.
DOF follows a practice which conforms to international
standards for human rights, and Group operations are man-
aged in accordance with fundamental labour standards. Our
guidelines and standards are based on the ILO Convention
that prohibits all use of forced labour or child labour. DOF
recognises and respects the employees’ right of association,
organisation and collective bargaining, and the company
guidelines conform to the labour regulations stipulated by
all local authorities.
Labour / Management Relations
DOF is part of an industry known to be cyclical and in down-
times redundancy and down-sizing are an unfortunate part
of the cycle. DOF ensures continuous dialogue with employ-
ees’ representative and trade unions. It is inevitable that
workforce numbers will change according to demand, how-
ever DOF will do its utmost to assist employees aected by
down-sizing and have a robust program to support those
employees with career and financial counselling.
Training and Education
The DOF training framework is based on nine key strategies:
• Cultivate Core Values, Safe the RITE way;
• Partner with dierent business units to establish core
competencies;
• Leverage Intellectual Capital;
• Invest in Strategic Learning;
• Align Strategies with Corporate Objectives;
• Broaden Learning Activities;
• Focus on Performance Solutions;
• Speed up knowledge transfer and knowledge retention;
• Build our employee branding.
In addition to training for DOF employees, all third-party
personnel onboard our vessels must complete a vessel induc-
tion process, with vessel familiarisation, DOF’s operational
standards and Code of Business Conduct, and mandatory
e-learning modules covering Permit to Work, Management
of Change, and Risk Assessment.
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2021 results within People
Through entire 2021, DOF has strived to protect our peo-
ple onboard and in our oces from the COVID-19 virus.
Despite hundreds of employees infected throughout the year,
everyone has recovered. The continuously changing require-
ments and recommendations from governments and health
organisations has been exhausting. Nevertheless, we have
been able to maintain our guidelines and regional protocols
aligned with current requirements by tremendous eort by
the onshore organisation. However, the greatest burden has
been on our people oshore who have experienced quaran-
tine periods, extended and changed shifts, travel restrictions
and less time at home.
Based on experience through the pandemic, Medical Service
and Employee Benefit Program has been strengthened to ensure
they provide support for mental well-being and health issues.
DOF went into 2021 with many ambitious HSE projects and a
clear objective to improve the results from the previous year.
The HSE results are better than in 2020, but still far away
from our ambitions. The trend throughout the year was very
positive, but in Q4 we experienced a number of incidents
connected to lack of awareness and inexperience. We find it
likely that a major contributing factor was the wave of the
Omicron variant taking the focus, demotivating an already
fatigued organisation, and imposing new restrictions requiring
use of personnel not familiar with the DOF safety culture.
Modern communication
The substantial eorts started in 2020 to modernise the com-
munication channels in DOF continued throughout 2021. Our
communication strategy changed during 2021, with increased
focus on promoting and empowering our people. This will
continue as a key communication strategy going forward.
A new initiative with global, digital town hall meetings lead by
the CEO started in Q3, and this will continue as a quarterly
session. The town hall meetings consist of the CEO giving a
general “state of the union” update, and a part of the session
where a specific topic is presented by a subject matter expert.
In 2021, the organisation in Brazil arranged Annual Leaders
Seminar 2021. Due to the COVID-19 pandemic, the event was
held in virtual format. The theme of the event was "Shaping
DOF for the future" - the strategic plan of DOF Group going
forward. More than 450 employees from both onshore and
oshore were engaged during the event through the chat,
sending questions and interacting through the platform.
The Modern Workforce Communication project made significant
progress and approximately half of our oshore employees
had received their DOF email account by end of 2021.
Other improvement activities delivered in 2021:
•
Maintained ISO 45001:2018 certification status for the DOF Group.
• Global survey among our oshore crew that gave valued
input and advices on how to improve eorts within Occu-
pational health and Safety
• Update to Cyber Risk Management standard
• Improved coordination, dialogue and regular meetings in
the global HSEQ organisation
• Regular issues of monthly Safety Theme reflecting current
challenges at the time
Work-related injuries 403-9
All HSE incidents are reported through a common system
for DOF, “Docmap”. The system is available in the oce
and on all DOF vessels. Among the data captured for each
incident is Type of injury, injured body part, Gender, Age
and Injury classification.
HSE reporting aligns with the reporting principles of IMCA.
The man-hours used to calculate frequencies are based on
exposure hours and include hours for all personnel on our
vessels. This provides the most accurate indicators regard-
ing the overall safety performance.
Significant metrics are outlined in Figure 6 and Figure 7 on
page 142 shows the Occupational Health and Safety Indicators.
For 2021 the objective was to be below 0.3 LTIs per million
man-hours. At the end of the year, we reported 0.68 LTIs
per million man-hours for DOF as a whole.
The total recordable injuries rate (TRIR) for DOF was 2.05
in 2021. The TRIR is an indicator of the total number of
LTIs, restricted workday cases and medical treatment cases
per million man-hours. The IMCA TRIR for 2020 was 1.09.
Number of first aid cases has for 2021 been 6.26 per mil-
lion man-hours.
The main types of injury are lacerations and impact inju-
ries (sprains / fractures).
Being a global company operating within multiple cultures,
openness is a key approach. Our result in reporting safety
observations, both positive and negative, reaches the impres-
sive figure of 711 reports per 200,000 man-hours.
In 2021, there were six lost time injury cases recorded.
One incident resulted in partial amputation of a finger when
finger was hit by a high-speed object due to unexpected
release of pressure.
Two of the incidents did not result in long-term absence or
permanent disability.
Three of the incidents occurred towards the end of the
year and the injured persons had not returned to work by
31.12.2021. It is expected that the injured persons will fully
recover within 6 months.
In most locations where DOF operates, trade union agreements
contain provisions that address the health and safety of our
employees. All our oshore workers are covered by the MLC 2006.
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Emergency management
Emergency Management protocols and systems are well devel-
oped within DOF; however, this is an area where training
and readiness are crucial to the eective management of
any emergency situation or crisis. Regular scenario train-
ing, conducted by third party organisations specialising in
Crisis management, is provided for personnel in the Emer-
gency Response Teams (ERT). Scenario Training is supported
by electronic system exercises to ensure individuals remain
familiar with the system.
Emergency response training exercises range from a variety
of oshore scenarios to more universal themes of business
continuity in order for DOF to ‘Stress Test’ and improve
where necessary. Organisational compliance is monitored by
Key Performance Indicators.
During the year, there were 58 mobilisations in the Cri-
sis Management system. 30 were actual incidents; 28 were
exercises. The high number of actual incidents can be attrib-
uted to the system being used to handle actual or suspected
COVID cases onboard vessels.
Cyber security
There have not been any major cyber security incidents in 2021.
FiftyFifty
Since 2017 the FiftyFifty programme has educated women from
both Norwegian and international companies. The programme
is presented by AFF and is based on the UN Sustainable Devel-
opment Goal 5 “Gender Equality”. FiftyFifty has, since its
origin in 2017, brought women together from both Norwegian
and international companies to learn and share best practices.
In 2021, seven women in DOF joined the program together
with women from many other industries.
DOF’s global goal is to reach 25 percent female representation
in the seasoned professionals and management group by 2025.
DOF Ambassador Program
The DOF Ambassador programme is a platform for employee
career development. The programme oers potential lead-
ers and executives a structured professional development
programme, which is scheduled over the coming years. The
programme was intended to start in 2020, but was suspended
due to COVID-19 restrictions as it required the cohort to
travel to Norway. In 2021, the program was started with dig-
ital sessions connecting participants from all DOF regions.
Hybrid working arrangement
Hybrid working arrangement introduced to DOF in 2021 as
a permanent arrangement. This is regarded by World Eco-
nomic Forum as a very important measure to stimulate
female carrier path when taking care of children. A global
survey performed in 2021 gave clear feedback that a hybrid
working arrangement contribute to better work-life balance,
without compromising people’s work performance.
Maritime Trainee
DOF is proud to participate in the Maritime Trainee program
delivered by the Norwegian Shipowners Association (Norges
Rederiforbund). The program was established in 2005 and
has delivered 250 trainees and is one of the leading man-
agement trainee programs in Norway. The Maritime Trainee
program provides solid contribution to the promotion of the
Maritime Industry and all its future opportunities.
The program has a duration of 18 months and combine
working in a leading maritime company with an academic
program. The academic schedule focus on gaining maritime
knowledge across international ocean industries, digitalisation
and new technology development, maritime law, sustainabil-
ity and corporate governance.
In 2021, DOF had two participants of the Maritime Trainee
program.
Our Employees
DOF aims to provide all employees with a safe working
environment where they can advance their careers, develop
their expertise and have a flexible working day. The focus
on DOF’s fundamental values – respect, integrity, teamwork,
excellence and safety – has resulted in an improvement
in individual eciency and productive attitudes among
our employees. DOF has a long-term plan for training and
development of its employees.
Diversity and inclusion have always been of high impor-
tance to DOF. The Equal employment Opportunities policy
ensures a fair recruitment process. Candidates are treated
fairly, professionally and with respect. DOF employs the
most competent person for a position based on their skills,
knowledge and experience.
Our workforce is comprised of 73% full-time employees
and more than 2,500 employees are covered by collective
bargaining agreements (87%).
Diversity of governance bodies and employees 405-1
The Board of Directors in DOF ASA is comprised of 50%
men and 50% women. 25% 30-50 years old and 75% are
over 50 years old. Overview of employee diversity can be
found on page 124 - Diversity of employees.
Benefits provided to full-time employees that are not
provided to temporary or part-time employees, by
significant locations of operation 401-2
Standard benefits to employees can vary depending on the
country’s legislation where DOF operates. The key regions
for the marine and subsea operations are the Atlantic
encompassing companies located in the UK, Norway; South
America in Brazil and Argentina; North America in USA and
Canada; Asia-Pacific in Australia, Singapore. In general, the
same benefits apply to full-time and temporary or part-time
employees, with minor variations in the coverage depending
on the region / country where they are located. A detailed
overview can be found on page 172 in Appendix B.
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Minimum notice periods regarding operational
changes, including whether these are specified in
collective agreements 402-1
The minimum notice periods may vary, depending on col-
lective bargaining agreements, individual agreements and
statutory requirements. A summary of the practices in the
dierent regions where DOF operates is given below.
Asia-Pacific - In Australia, number of weeks not speci-
fied within Modern Awards or Fair Work Act. Regulatory
documents state “…as soon as practicable…” and therefore
the employer must check to ensure it complies with each
award of the eected employees at the time. In most cases
one month notice applies. In Singapore, the notice duration
should be in accordance with the contractual terms mutu-
ally agreed upon, which for DOF is one (1) months' notice.
In Indonesia, the notice period is one month. In Philippines
the minimum notice period is one month.
Atlantic - In UK there is a minimum of one months’ notice
provided for major operational changes aecting employees
and for statutory requirements, notice will be in accordance
with valid regulations.
In Norway, the minimum number of notice period defined in
the relevant national working legislations or in the employ-
ment agreement varies from 4 to 12 weeks. This is defined
in the relevant national working legislations, collective bar-
gaining agreements or in the employment contract. If the
employee is on probation period, a period of notice of 14
days will be applicable.
South America - In Brazil, the period varies depending on
the years of work. In case of contract rescission, the employer
must give one-month notice + 3 days for every year worked
in the company.
North America - In the USA, there is no defined mini-
mum notice period, however there are limited circumstances
which trigger statutory requirements. In Canada, the mini-
mum period of notice in terms of changes in employment is
based on a number of factors, including the circumstances
of the change. Notice that may aect employment status is
given based on years of service.
Average hours of training per year per employee 404-1
The average hours per person budgeted is 16 hours per person
for training, with an additional 8 hours for global informa-
tion meetings per annum.
The budget for each person is USD 1000 for training, per annum.
Programs for upgrading employee skills and transition
assistance programs 404-2
DOF have training matrices covering both basic and advanced
training for its workforce. The DOF workbook is the basic
and introductory training covering the most relevant topics.
More advanced training is provided by a various training pro-
viders including Universities and Maritime University college.
Our transition assistance programs come in force when
employees are moved from oshore to onshore or when
there is need for recruitment or new competence. Various
programs are tailored for the transition from one part of
the company to another.
The Manila Accounting Support Hub (MASH) was established
in May 2019. The MASH team is providing accounting ser-
vices to DOF entities in several regions. This new services
relief the DOF accounting from repetitive and manual work
into more advance accounting tasks that are supported by
internal or external training.
There are various severance programs in place and adjusted
to national programs. These programs allow a smooth transfer
to full retirement. This is done as part of Company succes-
sion planning as well.
In case of termination of employment, DOF will seek to pro-
vide guidance to facilitate continued employability outside DOF.
There are arrangements in place to stimulate employees to
higher education combined with employment balancing time
for study and present at work. These programs allow to plan
for skills that help the organisation to meet strategic goals
in a changing working environment.
Percentage of employees receiving regular
performance and career development reviews 404-3
DOF seeks to conduct annually career development reviews
/ appraisal for all eligible employees (depending on opera-
tional area / type of position) together with their managers.
An overview of performance reviews is given on page 171
(Figure 19)
Non-discrimination 406-1
In 2021, there were three confirmed incidents of harassment.
Two incidents resulted in dismissals, and one resulted in
other disciplinary action.
2022 focus within People
The overarching focus in 2022 will be on our safety culture,
through the principle of “safety starts with you” and lead-
ership engagement.
DOF has for many years had its “10 Life Saving Rules”. In
2022, we will adopt the IOGP Life Saving Rules, which are
similar, but will align us with other companies in our industry.
A framework will be established for using digital tools to
perform management visits, audits, inspections etc. This
will allow more frequent interaction between onshore and
oshore personnel and will be used in combination with
physical vessel visits.
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87 %13 %
MenWom en
Employment type - Figure 1
Demographics - Figure 3
1 %
24 %
2 %
Temporary
contract
(Full-time)
71 %
Permanent
contract
(Full-time)
Permanent
contract
(Part-time)
Self-employed
workers
Temporary
contract
(Part-time)
2 %
BY GENDER UNDER YEARS
BETWEEN
AND YEARS OVER YEARS
Female 22.0 % 12.5 % 8.6 %
Male 78.0 % 87.5 % 91.4 %
Total 15.0 % 61.5 % 23.5 %
BY GENDER
STAFF MANAGERS SENIOR MANAGERS
Female
14.8 % 10.3 % 2.5 %
Male 85.2 % 89.7 % 97.5 %
Total 77.8 % 11.8 % 10.4 %
Diversity of employees - Figure 2
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Work will continue with modernising the way operational HSE
activities are performed. The main method to achieve this
will be to digitalise the processes related to vessel specific
checklists, Permit to Work and Risk Assessments, Manage-
ment of Change and Toolbox Talks.
The DOF Workbook will be rolled out with training ses-
sions globally. Dierent methods of delivering training will
be available: Classroom training, digital training sessions,
and self-study with video presentations.
In connection with upgrade to new version of the Business
Management System, we will use the opportunity to sim-
plify the system. Our industry is known to be bureaucratic,
and in this context, we must strive to ensure we are not
adding additional bureaucracy by self-imposed requirements.
During the year further work will be focused on the imple-
mentation of the measures in the Cyber Risk Management
Standard, including ship specific risk assessments, raising
awareness and further enhancing the Cyber Risk Management
within DOF. This work will be coordinated by the new Cyber
Security Task Force, supported by executive management.
DOF is an equal opportunity employer and has zero toler-
ance for any form of harassment within the workplace or
local communities.
In 2022, DOF will continue to take full advantage of mod-
ern platforms for communication and collaboration which
proved vital to business continuity the last years and in light
of the pandemic. This includes an Enterprise Social Network
solution to improve workforce communication by making it
easier to communicate and allowing interactive communica-
tion. New tools for collaboration will allow for more ecient
collaboration across all DOF entities and regions. A project is
underway to improve the way information is made available
to oshore personnel, by providing company e-mail address
and access to company portal for all oshore employees.
In addition to this, a new talent management platform will
be rolled out for all employees, supporting regular follow-up
and goals throughout the year.
DOF joined the SHE Index in 2021 and will continue the
eorts to balance the teams with regards to and other rel-
evant parameters. DOF aims to strengthen our capability
to measure and act on diversity and inclusion in leadership
and workforce. As part of this, several activities will be done,
such as global analysis of gender pay gap, and gender distri-
bution in dierent employee categories.
Leadership development
“In the space of business and organisations, leadership is
about getting the employees to work towards a common goal
through motivation, commitment and well-being” – the quote
is taken directly from the DOF Workbook. During the year
a series of leadership training session will be held globally.
The one-day training courses will be focused around the
DOF values, leadership theory and practice, project manage-
ment, communication and financial understanding. Another
important part is to focus on leadership in Occupational
Health and Safety.
Continue fifty-fifty
The fifty-fifty program has been a success so far and will
continue in the coming years. Variants of the concept will
be rolled out globally allowing female talents to strengthen
their self-esteem towards their career, in trustful surround-
ings in close dialogue with executive female leaders and
academia. This is an important activity for DOF to reach
the organisation’s ambitious targets within diversity between
male and female.
Continue ambassador program (next phase / new
ambassadors)
The ambassador program will continue with new talented
employees and adjusted according to our learning and expe-
rience from the first group. The program has shown to be
an important supplement to our retention program and
good arena for DOF’s executive team to meet the new gen-
erations of leaders.
Smarter and inclusive communication
DOF will change the communication profile focusing more on
people and feel-good articles on our intranet and various social
media platforms. Recognising the challenges the industry has
ESG FACTBOOK People
Inspire & motivate Show integrity Solve problems Drive for result Communicate
DOF's leadership principles
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dof subsea integrated annual report 2021
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been through during the two years of pandemic we need an
active approach to stimulate optimism in the organisation. The
fact that the Company is now in a dynamic growth recruiting
new employees and turning strategy towards the renewable
market calls for a smarter and more inclusive communication.
Various means of communication will be tested out. Podcast
that will enhance employees understanding of areas like oshore
wind and Circular economy are some examples. New and
smarter ways of presenting PowerPoint presentations on safety
meetings utilising videos and with artificial avatars presenters
to secure consistency in the message. Finally, DOF will utilise
the potential to reach out in social media. DOF have over
160 thousand followers at LinkedIn. This figure will be used
as inspiration to get higher utilisation of Yammer internally.
Ethics Helpline
During 2022 various initiatives will be made to enhance
respect in normal interaction in the Company. The analy-
sis of situations and reports from our Ethics Helpline is not
acceptable and in breach with our Code of Conduct. This
will be addressed in training and campaigns. Some initia-
tives will be organised from corporate and others regionally.
New Code of Conduct – strengthen respect
The Code of Conduct will be strengthened with some new
chapters like circular economy, life below water and biodiversity.
Examples in the dilemmas will be on relevant situations like
use of plastic and other examples as dilemma when client ask
us to do high speed on a boat to reach shore when no one
is expecting us. This results in extra tons of diesel burned
without good purpose and consequently unnecessary GHG
emissions. The common theme across the UN SDGs is human
rights; this is addressed in the current Code of Conduct and
will be even clearer in the new version of the Code.
Future goals within People
Safety awareness is a never-ending process, and our goal
is to be recognised as the safest provider of subsea and
vessel services to our growing international and global client
base. The Watertight Integrity Test, launched in our code
of conduct, starts with a simple question; “Is it Safe?” If
the answer is no, action must be taken.
As personnel join the Group, we ground them in our values-
driven approach and provide them with the necessary practical,
and theoretical training to appreciate the importance of
acting in line with the values and principles.
We continue to enhance safety culture onboard our vessels.
DOF issued the first HSEQ Workbook in 2012. A new Workbook
was introduced in 2020 and expanded beyond HSEQ, to cover
all aspects of the company and published on DOF’s website.
The DOF workbook is the backbone of training within the
Group for the next 5-6 years. Through a holistic approach,
employees will be exposed to training ranging from induction
to the Company, our values, and risk assessment approach,
to more advanced modules like project management.
To build on the strengths of teams so the eorts of one
team can be quickly replicated or adapted in another region
is a key concept. The ability to harness the creative talents
from a region, by incorporating their solution into a potential
business opportunity in another region, will enable DOF to
respond to clients with timely, proven solutions and result-
ing in a cost-eective outcome for DOF and its clients.
DOF will increase the use of Subject Matter Experts selected
from appropriate regions to provide support to corporate and
project related teams. The implementation of the ‘modern
toolbox’ will support this eort.
Various initiatives in the Human Resourcing areas of resourc-
ing, attraction, privacy compliance, retention and development
of employees will be executed. We remain committed to
sourcing talent and developing employees and to adapt to
market changes. In addition, enterprise social media plat-
forms, both internal and external, have been implemented
to improve communication with our workforce and exter-
nal stakeholders.
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Planet
Our company value that is directly connected to planet:
RESPECT
“Respect underpins everything we do and every interaction we have. Respect
for people: our colleagues, our customers, and our business partners. As
global citizens we are socially responsible, we respect the individual, the
local customs and cultures of our various markets. Acting with care and
consideration is central to our wellbeing and safety and ensures we mini-
mise our environmental impact.”
The Group aims to create an environment of empathy, mutual respect
and understanding amongst all stakeholders. DOF is an equal opportunity
employer and does not tolerate any form of harassment or discrimination
within the workplace or local communities where we operate.
We operate in an evolving market. It is vital for DOF to develop in the energy
sector, together with our key partners, in line with the targets articulated
in UN’s Sustainable Development Goals.
A key to meeting stakeholders' expectations is the implementation of new
technology and digital solutions to reduce GHG emissions and become more
ecient. An objective for the next 3-year strategic period and a driver for
value creation. As a responsible organisation and through Respect we aim to:
•
Maintain our equal opportunity employer performance: we will not tolerate
any form of harassment or discrimination within the workplace;
•
Operate responsibly at sea, with minimal impact upon the environment;
• Reduce our environmental impacts by delivering energy eciency and
the well-established zero-mindset to any discharges of harmful material
into the sea, making DOF an attractive business partner;
• Adapt to the global communities’ changing expectations to climate
change and pollution.
Within Planet, we apply our values
to define significance,
guide our approach, assess our results, and set the ambitions into our future.
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2021
2021 activities within Planet
Environmental Performance
Also, an aspect of respect, Environmental Performance,
is governed by the DOF Environmental Impact Policy. It
reflects corporate intentions, principles of actions and
aspirations to improve environmental performance.
Responsibility for ensuring that DOF is committed to
minimising its environmental impacts in line with the
‘Polluters Pays Principle’, ‘Precautionary Principle’ and
‘Duty of Care’, Energy Efficiency and Climate Impact lies
with the Board of Directors.
Since 2010, DOF has reported key environmental performance
through CDP and the reporting has directly influenced the
development of our Business Management System and the
programs established to manage our environmental
performance.
Our Environmental Management System (EMS) ensures
that DOF effectively manages our operations and strives
for continual improvement of our environmental performance.
Using technology to reduce fuel consumption
DOF has well established systems and new initiatives
operating in parallel to deliver fuel eciency and reduced
GHG emissions.
Implemented in 2012, the Ship Energy Efficiency Management
Plan (SEEMP) is vital to our EMS. The SEEMP was
developed in partnership with DNV and aligned to the
guidelines set out by the IMO marine environmental
protection committee. SEEMPs are applied across the
whole fleet to plan, implement and monitor the measures
required to maximise vessel efficiency.
All DOF’s vessels operate with Marine Gas Oil (MGO).
DOF complies with the regulations in the industry,
especially with IMO and MARPOL Annex IV, Regulation
14, regarding strict measures addressed to ship owners
to control the emissions of NOx and SOx from their
ships, in Emission Control Areas (ECA) where ultra-low
sulphur fuel is required.
Several vessels are fitted with technology reducing fuel con-
sumption and emissions.
• DOF has for more than 15 years focused on reducing NOx
emission to air: the main contributor is the instalment of
Selective Catalytic Reductions (SCR) systems which can reduce
NOx emissions up to 90%. SCR is a means of converting
NOx with the aid of catalyst urea into N2 and Water.
• The diesel electric hybrid propulsion system allows greater
operational flexibility and reduces energy consumption, CO2
emissions and maintenance costs. This propulsion system
is ideal for DOF’s combined anchor handlers and oshore
construction vessels.
• Improvements, particularly on hull design, have been made
through close industrial cooperation with main suppliers.
This experience transfer ensures continuing enhancement
of technology into the future.
0
Spills over 50 liters
Number of unrecovered spills in 2021.
23.9
CO
2
emissions
Emissions per operational day in 2021.
(tonnes CO2e)
CDP
DOF has reported to the Carbon
Disclosure Project since 2010.
Energy efficiency
DOF is continuously monitoring and
improving the Ship Energy Efficiency
Management Plans and establishing eco
speed curves for optimal sailing speed.
New tools
DOF is working together with
Kongsberg Group and Innovasjon
Norge to develop new technology for
optimal energy use onboard vessels.
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ESG FACTBOOK Planet
•
DOF deployed cloud-based analytics software system success-
fully on all vessels in 2021. Maress analytics allows decision
makers on shore and on the bridge to make more informed
decisions on how to reduce emissions. Maress allows DOF
to fully understand the emissions from individual vessels,
and for the fleet as a whole. Due to the smart re-use of
existing data the system can be rolled out quickly and was
operational on the whole fleet in Q1 2021.
•
The research project partnership with Kongsberg Maritime,
SINTEF Ocean and NORCE to develop of a new generation
Decision Support System (DSS) for oshore vessel opera-
tions were finalised in 2021 and is now undergoing final
adjustment to be rolled in the fleet.
•
Developing shore-side electricity connections for port stays
has delivered considerable environmental benefits by utilising
renewable energy reducing carbon dioxide, sulphur dioxide
and nitrogen oxide emissions to a minimum. Modifying
vessels for this technology is continuously evaluated based
on the availability of shore-side connections where our
vessels operate.
Spill avoidance is captured by KPIs and as a ‘bearing
element’ in the ISO 14001 certification is audited regularly.
DOF’s maintenance regime incorporates spill avoidance
objectives in order to reduce the risk of environmental
impact from incidents.
All vessels have a Shipboard Marine Pollution Emergency
Plan (SOPEP/SMPEP) which provides guidance to the
Master and officers on board the vessel as to the steps
to be taken when a pollution incident has occurred or
is likely to occur. The plan is reviewed annually, and a
regular drill held.
DOF’s internal procedures for bunker and fuel testing
ensure control of fuel supplies to its vessels. The main
objective is to ensure good quality and uncontaminated
fuel supplies to offshore installations, in accordance with
Charterer requirements. All contracts between DOF Marine
and charterers specify the quality of the fuel as per ISO
8217, Bunker Fuel Standard.
Innovation & climate resilience
DOF conducts operations in compliance with best practice
techniques and principles, worldwide. As such, DOF
standardises its global approach to meet the highest
requirements of legislation and the expectations of external
parties both locally and internationally.
Risk Identification and Assessment analysis of where we
are most likely to deviate from these commitments and
what the risks are should this happen, is undertaken.
Control measures can be identified to ensure that our
levels of exposure are acceptable for all stakeholders.
2021 results within Planet
Respect underpins the flexibility we have in our organisation.
We can call on specialist individuals who because of the
common respect for each other, have a commitment to
meet shared goals. Without mutual respect, the high level
of coordination and cooperation required to address
corporate or operational challenges is more difficult. DOF
has a proven record of adapting assets quickly and
developing operational solutions to meet difficult and
time sensitive challenges from their clients that delivers
successful project execution outcomes. The following
reporting concerns all DOF vessels and all environmental
initiatives in the Group.
Energy Consumption within the Organisation
and outside the Organisation 302-1 | 302-2
The majority of DOF’s energy consumption comes from
non-renewable sources, which is attributed to fuel consumption
on our vessels. The energy consumed in our oces comes
from both renewable and non-renewable sources, depending
on the energy infrastructure in the area where the oce
is located.
Figure 10 in Appendix B.4 indicates the organisation's
energy consumption in joules. Electricity consumption
per country is detailed in Figure 11, also available in
Appendix B.4.
302-3 Energy intensity
In 2021, the energy intensity for fuel consumed (Scope 1
vessels) was 332.5 GJ per operational day.
Managing Fuel Consumption and Emissions
to Air (Carbon Dioxide Emissions)
305-1 I 305-2 | 305-3 | 305-4 | 305-5
The Environmental Impact Policy sets out clear aspirations
to ensure that our operations have minimal impact on
the environment. This requires DOF to calculate and
anticipate potential challenges before activities take place
through risk identification processes, to ensure that the
environmental impacts are understood and reflected in
our activities.
From reporting year 2021, DOF uses CEMAsys.com for
carbon footprint management. The system enables gathering
and management of data connected DOF’s climate change
impact, according to the international Greenhouse Gas
Protocol.
The system allows DOF to report its carbon footprint
with a new degree of accuracy and integrates current
conversion factors for emissions and energy consumption.
In addition, the reporting of Scope 1 and Scope 3 emissions
for vessels is now more accurate.
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For vessels owned by Joint Venture, DOF will report
emissions equivalent to % ownership in the JVs as agreed
with JV partner. This is to avoid that both companies
report 100% emissions on these vessels, which in
consolidated reporting would lead to inaccurate figures.
For the activity-based metric, tons CO2 per operational
day, the figure has been recalculated with the assumptions
for the 2021 reporting, to provide comparability year by
year. The historical figures for 2020 and earlier will
consequently vary slightly from what has been reported
in previous years.
Data regarding Scope 1 concerns vessel fuel consumption
for DOF vessels (including third party vessels) where
DOF is in operational control. The resulting CO2 emissions
are detailed in Figure 12. During 2021, the total Scope
1 emissions were reduced by 6.6% (26,012t CO2e) compared
to 2020. However, the emission per operational day
(intensity target) increased by 2.1% compared to 2020.
This is mainly attributed to many vessel movements
between regions, as vessels needed to be reallocated due
to COVID-19 effects on operations.
Scope 2 data relates to electricity and heat consumption
in buildings where DOF has offices or warehouses, and
electricity for vessels with shore power connection
capability. Scope 2 accounts for 1% of DOF's total CO2
emissions. DOF has decided to use "The Greenhouse Gas
Protocol: A Corporate Accounting and Reporting Standard
(Revised Edition)" to calculate the CO2 emissions originating
from onshore electricity consumption (Appendix B.4,
Figure 12). From 2021 going forward, Scope 2 emissions
will be reported market-based.
Data regarding Scope 3 concerns fuel vessel consumption
for DOF vessels (including third party vessels) where the
end client is in operational control. Scope 3 also includes
business travel and incinerated waste onboard vessels.
During 2021, the total Scope 3 emissions were reduced
by 12.9% (14,449t CO2e) compared to 2020.
Total number and volume of significant spills
DOF considers any loss of secondary containment over
50 litres to be a significant spill. This is in line with
the definition from IMCA SEL-010. The target is to have
zero significant spills to external environment.
In 2021, there were no loss of secondary containment
spills that exceeded the 50-litre threshold to environment.
One incident of loss of primary containment was recorded
where approximately 600 litres of fuel spilled on deck
during bunkering operation. However, loss of secondary
containment was prevented by the mitigative actions taken
by crew on board, prevent release to the external
environment.
During the year, 36 environmental incidents were reported.
This results in 4.10 incidents per million man-hours. This
is slightly above the KPI of less than four spills per
million man-hours. The majority of spills are very small
spills related to ROV operations.
DOF experiences variance in the quantity of spills due the
broad nature of our activities. Within marine operations,
we tend to see larger spills that are contained on deck to
prevent loss of secondary containment. In subsea operations,
there is generally very small quantities of substances released.
However, these releases often stem from subsea equipment
in operation which make it more likely to be released directly
into the environment and become defined as loss of secondary
containment.
It is challenging to record the exact volume of liquid spilt
as most spills are contained before being released (secondary
containment) by marine spill kits and protocols. Measuring
the volume is based upon individual’s best judgement at
the time of the incident, often in rough weather and
darkness. The total volume of all spills during 2021 was
1,009 litres, whereby 82 litres was considered loss of
secondary containment. The KPI for the area set to be
zero, but the result is 9.34 litres with loss of secondary
containment per million man-hours.
Compliance 307-1
In 2021, DOF has not been subject to any significant
fines or non-monetary sanctions for non-compliance with
environmental laws and/or regulations.
Waste generation and significant waste-related
impacts 306-1
DOF generates both hazardous and non-hazardous waste
as part of routine vessel operations. Generation of waste
(i.e. non-hazardous), is the by-product of a number of
activities listed in the table including and further classified
in two different categories (see tables below and on
following page).
Various activities
• Accommodating crew members on board vessels
• Recovered materials subsea as part of contracted scopes of
work or marine duties
• Maintaining vessel equipment
• Packaging from goods received via supply chain
• Replacing or refurbishing end-of-life products
Waste categorisation part I
• Plastics
• Operational waste
• Food wastes
• Animal Carcass(es)
• Cooking oil
• Fishing gear
• Electronic waste (E-waste)
• Domestic wastes (e.g., paper products, rags, glass, metal,
bottles, crockery, etc.)
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Part II is applicable to those DOF vessels carrying bulk
cargo, as required by contracted SOW
• Solid bulk cargo shall be classified per criteria in appendix
I of MARPOL Annex V, and shipper shall declare whether
cargo residues are harmful to the marine environment.
• Cargo residues which are not harmful to the marine envi-
ronment (non-HME) have less strict discharge requirements
then cargo residues which are harmful (HME).
The frequency of one-o, acute waste related incidents caus-
ing significant environmental damage is deemed low by the
nature of our core activities.
Management of significant waste-related impacts 306-2
Vessel operations are governed by MARPOL Annex V, whereby
receptacles are to be made available to segregate vessel gen-
erated waste.
MARPOL Annex V vessel segregation
• Paper / Board
• Glass
• Wood
• Plastic
• Metal
• Organic food waste
• E-waste, Hazardous waste, batteries, aerosol, bulbs, printer
cartridges
• Health Service & Other Possible Infectious Waste
• Mixed, Contaminated or generally
• Non-recyclable Waste
Each vessel operates according to a Garbage Management
Plan outlining specific segregation requirement. Garbage
Management Plan also outlines the use of vessel waste
management equipment to ensure that waste impacts are
mitigated, this also includes operational procedures.
Segregation requirement
• Food grinder in the scullery
• Garbage compactor
• Glass crusher
• Incinerator
• Replacing or refurbishing end-of-life products
Waste-related data is logged in the vessel's Garbage Record
Book in accordance with MARPOL Annex V and the data
is available for monitoring by the onshore support
organisation.
All vessels also have a dedicated spill prevention management
plan. This outline controls such as use of spill kits,
scupper plugs and key roles during a loss of primary
containment on deck or secondary containment overboard.
Whilst the garbage management plan controls ‘routine’
waste generated offshore, DOF also has measures to
control Project specific hazardous waste generation. This
type of waste is generated on a project-to-project basis
and managed through project management and HSEQ
functions. Types of waste generated, include recovery or
handling of products/substances that have the following
contaminants.
Project specific waste generation
• NORM
• BTEX
• VOC
• Mercury
• Hydrocarbons
Waste-related data is logged in the vessel's Garbage Record
Book in accordance with MARPOL Annex V and the data
is available for monitoring by the onshore support
organisation.
Contaminants of this nature require specialist planning
of deck arrangements, including double bundled containment,
spill emergency response arrangements and personnel
monitoring and protective equipment. Where project of
this kind take place, it is likely that DOF operates under
Field Environmental Plans approved by both the operator
and/or state governing authority.
Key administrative controls are also in place to manage project
generated hazardous products, including but not limited to;
Identification of significant environmental aspects;
•
Risk Assessment of potential environmental impacts through
HAZID/HIRA processes;
•
Task plans to control work activities and minimise likelihood
of loss of primary/secondary containment;
•
Client, government and specialist approvals/agreements or
reviews as part of project authorisations.
Future goals within Planet
Emissions and Energy Reduction
DOF's ability to manage GHG Emissions is a key component
of the organisation’s ESG profile. Providing a vessel fleet
and services with reduced GHG emissions can become a
value proposition for clients and investors or negatively
impact upon competitiveness of the organisation against
peers. The main concern is DOF’s ability of to meet
changing stakeholder expectations associated with Greenhouse
Gas emission from ships, including Nitrogen Oxides (NOX),
Sulphur Oxides (SOX) and Particulate Matter (PM) in
harbour areas.
Active management and continual reduction of fleet-wide
energy inputs and GHG emissions is a significant material
concern. Technology and Digitalisation is seen as a key
enabler of managing this material issue.
ESG FACTBOOK Planet
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Energy Management
Energy Management is considered in DOF as the process
of identifying and bring forward initiatives, actions and
opportunities, monitoring, and measuring the quantifiable
benefits to the DOF Group’s strategy of reducing emissions
and reducing energy consumption.
Extended life of assets is a vital part in a transition
period where there is a huge uncertainty of which green
energy carrier will be sufficiently available. Consequently,
the most important work in a wider energy management
perspective, is the daily maintenance our good crew
perform.
DOF Group will continue and increase capabilities and
technology available to measure and gain insights into
energy consumption and emissions. New digital technologies
and products will deliver new insights into how and
where we use energy. These insights will enable us to
identify areas for improvement in 2022:
The “Intelligent Efficiency” product has been under
development since 2018. This is planned to be rolled out
on three to four vessels in 2022, pending final project
evidence of saving. Important bi-product delivery of
“Intelligent Efficiency” is the installation of “digital fuel
measurement and reporting” software solution which
avoids the requirement for manual registration of fuel
consumption by workers offshore. Furthermore, a vessel
performance shore portal /dashboard will follow the roll
out of the “Intelligent Efficiency” solution.
DOF will specify the company requirements for possible
implementation of hydrogen fuel cells combined with
batteries on selected vessels. We will also investigate use
of ammonia as a new zero/low-emission alternative to
traditional fuels.
It is also planned to install battery / energy storage system
on 2 vessels in 2022.
Science-based Targets
DOF recognises the importance of aligning our emission
reduction targets to Paris Agreement goals. This approach
is known as ‘Science-Based’.
A project will be initiated together with TERRAVERA
Foundation to model a structure to DOF's approach to
gather scope one, two and tree emissions. This will
provide DOF with a clearly defined pathway to reduce
GHG emissions and align with Stakeholder expectations.
DOF will work close with students from the technical
university, NTNU and the business university NHH. The
students will be guided by various professor within the
area in close cooperation with DOF and TERRAVERA.
The objective of the project is to build a model that is
suitable for scope 1, 2 and 3 emissions.
DOF has formed a strategic alliance with Kongsberg
Maritime Group to align efforts in reaching science-based
targets on executive level, for scope 1, 2 and 3 emissions.
In this perspective, DOF scope 1 is scope 3 for Kongsberg
Maritime Group, and vice versa.
Establishing Science-Based Targets shall provide a clear
pathway towards Net-Zero. During first half year a proposal
will be presented to Board of Directors to publicly
announce DOF as a Net-Zero emission company by 2050.
Single-use Plastic
As a steward of the environment, DOF recognises that
it is no longer acceptable to utilise single-use plastic
products. This too is reflected as a Material Issue for
the organisation. Unfortunately, to date, we still see
unacceptable quantities of single-use plastics being procured,
used offshore and subsequently disposed. This linear flow
of materials seen within the industry is contributing
towards what the UN Environmental Program describes
as a ‘Global Pollution Crisis’.
In 2022, DOF will be playing our part in addressing this
industry-wide environmental challenge with a series of
systematic measures to phase out employee generated
single-use plastic from our day-to day offshore operations.
In addressing this material concern, DOF shall take
inspiration from our hierarchy of control by first seeking
to eliminate the need to procure single-use plastic products
or finding reusable alternatives. Where use of single-use
products is unavoidable, we shall then endeavour to
substitute plastic with non-plastic alternatives. The last
resort is then to recycle any plastics we do use to ensure
material value is maintained.
In our 2022 campaign, DOF shall form a strategic alliance
within and outside of the industry to help expedite and
scale-up our efforts to phase-out single use plastics. This
shall be supported by a robust Group Charter outlining
management measures, in addition to quantifiable inventories
to track progress. These measures shall be verified as
part of ongoing audit criteria throughout the group.
Biodiversity and Marine Pollution
Biodiversity is the variety of life on Earth and the natural
patterns it forms. For DOF, what we see in our oceans
is the result of 4.5 billion years of evolution and increasingly
human influence. Ecosystem services such as food, fresh
water, air, and climate regulation are commodities people
and businesses rely on but depend on biodiversity
conservation. Anthropogenic changes to ecological systems,
whether planned or unplanned, are damaging not only
for natural capital but also adversely affect social and
economic development.
In 2021, when DOF mapped out revised material topics,
‘Ecological Impacts / Biodiversity’ was identified as a
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ESG FACTBOOK Planet
creates a more sustainable Value Chain, we need to adopt
a ‘Circular Economy’ mindset in which we keep resources
in use for as long as possible to extract the maximum
value from them whilst in use. The principle of recovering
and regenerating materials is then utilised to ensure we
can extract the most value from whatever resources we
have when it reaches the end of life. In doing so, DOF
reduces the need for raw materials mitigating its company
carbon intensity and footprint.
DOF understands that it needs to decouple its economic
activity from material and energy consumption by employing
circularity principles throughout its Value Chain and
existing processes.
A 3-year Circular Economy program shall be established
by DOF that takes inspiration from best practices and
frameworks such as the MacArthur Foundation. The 3-year
Program shall map circular opportunities throughout the
value chain, establish a policy strategy, develop a circular
transformation route and areas of collaboration and outline
a mechanism to review progress.
Ship Life Cycle Management
Understanding and optimising the data behind DOF’s
assets over its Life-cycle is the most effective and
meaningful way of achieving circularity. This entails
creating an inventory analysis of material inputs and
outputs over the lifespan of our most significant product,
vessels.
The process and outcome of understanding material flow
for a vessel will present unique opportunities to DOF
across the vessel phases of new-build, expected operational
life and extended life of the asset. Grasping these
opportunities is essential to DOF in building resilience
against an evolving industry landscape of decarbonisation,
growing global fleets, regulatory changes and global
sustainability transition. The illustration below visualises
some the Value Propositions associated with an increased
understanding of DOF Vessel Life Cycles.
risk for ‘Life Below Water’. The main areas of concern
relate to DOF’s ability to prevent the introduction of
invasive species through multinational vessel operations
and minimising the likelihood and severity of unplanned
discharges of hazardous materials.
While national and international regulatory frameworks
exist for these topics, DOF wants to go beyond compliance
by establishing further improvement initiatives. This year's
improvement measures are related to generating greater
company awareness of the biological interactions of our
activities and reinforcing existing operational controls
through increased governance mechanisms.
To ensure greater awareness, DOF shall establish ‘Life
Below Water’ educational materials for operational personnel.
This will correlate known biodiversity challenges, such
as biofouling, spill prevention and marine plastic production
to DOF operations and what we are doing to address
these interactions. Communication mechanisms shall
include Safety Themes of the Month and formal training
media.
Bolstering the governance and assurance, DOF shall deploy
more stringent reviews on marine pollution and biofouling
controls. This will involve scrutinising key documents
such as Biofouling and Garbage Management Plans with
increased frequency and rigour through inspections and
audits. DOF has also expanded the criteria for our most
comprehensive investigations, ensuring that biodiversity
or marine pollution incidents are thoroughly examined,
lessons are extracted, and we can prevent future
re-occurrence.
DOF believes the cornerstones of Awareness and Governance
are critical to improving our already industry-leading
practices for Life Below Water.
Circular Economy
The concept of Circular Economy is relatively new to the
Industry and DOF, but it is a game-changer. As DOF
The “Intelligent Efficiency - Industrialise”
product is expected to enable reduction in
fuel consumption reduction of 5 - 10%,
depending on vessels operational profile, by
providing insights and real time guidance to
vessel crew in how they can possibly improve
operation of the vessel and deliver optimum
fuel efficiency.
Intelligent Efficiency - Industrialise
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Remote Operations
Remote Operations can be considered as the ability of
workers to perform their duties without being physically
present on board a vessel, reducing our environmental
footprint.
The range of benefits must be considered holistically,
and not limited to a traditional assumption that remote
operations will automatically reduce personnel costs.
Personnel remuneration and worker contractual considerations
are out-with the scope of technical solution delivery.
The benefits which can be realised from remote operations
are operational in nature and primarily related to flexibility
and optimisation of resource allocation. Examples include:
• One subject matter expert located onshore can provide
live technical support and data services to multiple vessels.
• A vessel can switch from general FSV duties to ad-hoc
subsea inspection mode, without the requirement to mobilise
a team of inspectors.
• Reduction in travel and quarantine costs with associated
health and safety benefits.
• Remove the requirement for specialist sta to be oshore
for a longer period than necessary, e.g., a small inspection
scope should not generate a long trip for a large team due
to limited port calls.
DOF Subsea started using the “Survey in The Cloud”
solution in mid-2020. This platform will be augmented
to give real time access to onboard subsea project systems
such as survey, inspection, voice communications and live
video. The following activities will be done in 2022:
The “Survey in The Cloud – Remote Operations” is the
evolution of “Survey In The Cloud” and will be implemented
on four vessels in 2022. This will be done after successful
pilot on a vessel and creation of appropriate governing
support documents.
Progress testing of Remote Digital Class and DP services
which will allow certain surveys required by Class to be
done from shore with support from the crew.
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Prosperity
Our company value that is directly connected to prosperity:
EXCELLENCE
“Excellence in everything we do. We are resourceful and responsive to our customers’
needs; innovative in the solutions we apply to everyday problems. We safeguard our
individuality and the qualities that set us apart from our competitors, protecting
our reputation and the professional trust we have built, we do not walk away from
our commitments.”
Subsea and Marine services are the core value generating work of our business.
Building strong relationships and ensuring we have reliable assets, capability and
technology to support our customers in the evolving subsea and oshore energy sector,
is key to our future and therefore benefits all stakeholders. The ‘Shaping DOF for the
future’ strategy focuses on reshaping the organisation to reflect the market outlook.
Clearly, operational and technological excellence are strategically important to the
organisation’s future value creation and closely aligned to the delivery of material
issues Product Reliability and Customer Service.
Excellence is essential in our corporate governance and management activities and
in the provision of a reliable, ecient assets base; professional workforce and high
standard internal controls. The Group’s improvement program is important in
continuing to successfully dierentiate DOF from its competitors. DOF is committed
to continuously improve the organisational performance in all aspects of its operations,
including management of processes, knowledge, resources, and change.
Within Prosperity, we apply our values
to define significance,
guide our approach, assess our results, and set the ambitions into our future.
The interaction and synergies between DOF's different product offering need to
continue. The focus on DOF as a "one stop shop" within offshore wind, offering
a total life of field business, needs to be strengthened. Digitalisation & technology
development will be a central force to utilise our unique fleet of vessels, technologies,
and competence, where equipment will be utilised and adjusted within different
segments like SURF and offshore wind. Survey is a key competence with strong
interactions towards wind and mooring.
Offering a "one stop shop" for offshore wind
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2021 activities within Prosperity
Continuous Improvement
DOF monitors operations so areas for immediate or future
improvement programmes can be identified to provide our
employees with the best possible tools and services to per-
form their roles.
Alliances and partnerships are alternative options that can
provide DOF and its clients with specialised services or prod-
ucts currently unavailable.
Product reliability
For DOF, product reliability is providing the best service to
our customers with no delays. DOF is committed to deliv-
ering quality products and services by working with our
customers to understand the needs of their business and
consistently meet their requirements.
Product reliability is achieved through the Integrated Man-
agement System (IMS) and Business Management System
(BMS). DOF is now undertaking larger and more complex
projects and contracts, as well as investing in newer and
more advanced vessels.
Customer satisfaction
Customer satisfaction is measured through feedback sur-
veys and managing long-term contracts and winning repeat
business. It is best characterised by delivering services of
the best quality, at the best cost, at the right time and to
the required location.
Maintenance Management System
The Maintenance Management System is implemented on
all DOF vessels and for subsea assets, as well as third party
vessels on long term charter.
2021 results within Prosperity
Our industry is experiencing substantial change, disrupting
the way it has traditionally worked. New expectations and
requirements appear rapidly, and aect all areas of business,
from external environment to operational performance and
business ethics.
DOF must keep pace with these changes, work within our
values and business strategies, and involve all interested
parties. A Digital Transition Strategy was commissioned by
the Chief Operating Ocer, to outline the main roles and
responsibilities that the executive team will need to embrace.
The merger of DOF Management and Norskan, as DOF Marine,
has now settled and the new organisation is continuously
reviewing its key business systems and processes to be in
alignment with current best practice models.
The Subsea organisation has initiated several projects with
the aim to improve our product deliveries significantly, with
focus in three main areas: ROV operations, diving opera-
tions, and survey.
99%
Vessel uptime
Available operative time for vessel in 2021.
99.3%
ROV uptime
Available operative time for ROVs in 2021.
Continuous
Improvement
DOF has built its management systems
on the Plan-Do-Check-Act principle.
"Maintenance
the RITE way"
The programme aims to build a world-class
maintenance culture in the DOF Group.
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dof subsea integrated annual report 2021
2021
The ultimate proof of excellence is in our reliability figures.
The vessel uptime figure for 2021 was 99%. The equivalent
figure for ROV uptime was 99.3%.
Even though the pandemic has brought many practical chal-
lenges, there have been docking activities in 2021 as normal.
There have been no major issues with dockings, and a key
success factor has been the work that was done in 2019 to
improve the processes related to docking activities.
During 2021, it has not been possible to continue with the
“flying squad” due to travel restrictions. The concept has
proven to be a success and will recommence when practi-
calities allows it. This team travels around the global fleet,
assisting the vessel crew with performing periodical main-
tenance on-board instead of taking the vessel to shore. This
leads to more availability for our clients.
Maintenance Management
A successful pilot program with Karsten Moholt and the
skAIwatch system was performed in 2020. Throughout 2021
this system was implemented on the entire fleet. The system
collects data on machinery onboard the vessel, and presents
it in one common place, to quickly identify equipment that
needs maintenance attention.
A focus area for Maintenance Management in 2021 has been
quality control and planning, resulting in improved main-
tenance performance and cost eciency. Maintenance the
RITE way as a program will continue.
Product reliability results, Subsea ROV Operations 2021
Executive management visited Brazil in late 2019, for con-
sultation and review of DOF Brasil ROV performance. The
result of the review has been worked on throughout the last
two years, and improvement activities have been identified
for 2022 and part of the Group Improvement Program. A
Senior VP for Remote Systems has been appointed and is
now part of the Digitalisation and Technology function in
DOF. in close of the team will work in close collaboration
with Chief Operating Ocer to improve all aspects with
ROV operations.
Product reliability results, Vessel Operations 2021
The new Marine Operations manual was launched in 2018.
During 2021, the manual has been subject for smaller adjust-
ments. There have also been various activities to secure full
implementation of the manual.
The structure for follow up of activities related to DP inci-
dents has been strengthened, with appointment of a global
DP authority, as well as a deputy in Brazil. Two DP incident
reported and four event in 2021. One incident led to drive
o from position but no damages. The other lead to light
contact to a fix installation. No personal injuries, no dam-
age on the installation, some damage on the vessel that was
repaired within a week. This incident still under investigation.
Operational uptime DOF1
See Figure 4, page 159.
Customer satisfaction DOF 2
DOF uses dierent means to monitor our customers’ per-
ception of whether their needs and expectation have been
fulfilled. Systems are in place for obtaining, monitoring and
reviewing this information.
The results are analysed and used as the basis for our yearly
improvement plans as required. Our commitment is to deliver
quality products and services, safely and DOF works with
its customers to understand their needs and meet their
requirements.
DOF’s customer satisfaction forms are the main source for
monitoring our customers’ feedback and cover all phases of
our operations.
There were no formal customer complaints registered during
2021. However, some responses in customer feedback have
triggered internal non-conformity processes.
From 2020 to 2021 there were no major changes in the aver-
age ratings in the customer feedback.
We have continued to receive feedback from several clients
expressing recognition of DOF’s ability to maintain high
standards of quality in deliveries despite the challenges with
COVID-19. Even more importantly, clients have commended
DOF’s plans and measures implemented throughout mobilisa-
tion and on vessels to prevent infection and keep everyone safe.
Proportion of senior management hired from the local
community 202-2
In DOF, the significant areas of operations are considered
to be the four regions: Asia Pacific, Atlantic, South America
and North America. Each region has a Senior Management
Team that includes managers of the business units within
the region and is led by regional EVP. In 2021, the propor-
tion of senior management hired from the local community
was as follows, where “local” is defined as the country of the
business unit where the manager is employed:
• Asia Pacific: 87.5%
• Atlantic: 100 %
• North America: 100%
• South America: 100%
Operations with significant actual and potential
negative impacts on local communities 413-2
DOF does not have indication that any of its operations has
significant actual and potential negative impacts on local
communities.
ESG FACTBOOK Prosperity
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dof subsea integrated annual report 2021
Results (continued): EXCELLENCE
DOF 2 - Customer Satisfaction - Figure 5
Average ratings DOF Subsea customer feedback (received during 2021) - ratings range from 1-5, where 5 is the highest rating.
Average ratings DOF Management customer feedback (for 2021) - ratings range from 1-5, where 5 is the highest rating.
#1 - Mobilisation
#2 - Engineering
(Project & Design)
#3 - Client's Objectives
(Understood & Achieved)
#4 - Client Relationship
#5 -
Schedule Management
#6 - HSE Management
#7 - Site Operations
#8 - Overall Project
Management (including
communications)
#9 - Overall Performance
#10 - De-Mobilisation
Overall Survey Rating
2021
4.1 4.2 4.4 4.3 4.4 4.1 4.1 4.4 4.3 4.1 4.2
2020
4.2 4.3 4.3 4.4 4 4.2 4.5 4.3 4.3 4.1 4.3
HSE Management
Co-operation
Flexibility
Dialogue
Delivery of service
Cost
Results
Added value
Overall Survey Rating
2021
3.9 4.5 4.5 3.8 4.2 3.5 4.2 4.1 4.2
2020
4 4.3 4.3 3.8 4 3.7 4.2 4 4.1
DOF 1 - Operational uptime - Figure 4
QUALITY INPUTOUTPUTS
GLOBAL TARGETS
METRICS
Available operative time for VESSEL – Time in % when
vessels are in an operating mode and under contract
with a client = < 2 % Down time for client due to
vessel availability.
> 98.0 % 99.0 % 99.7 % 99.4 %
Available operative time for ROV – Time in % when
ROV are in an operating mode and under contract with
a client = < 2 % Down time for client due to ROV
availability.
> 98.0 % 99.3 % 99.0 % 98.9 %
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dof subsea integrated annual report 2021
2022
2022 focus within Prosperity
Respecting development and support of the
communities where we operate
A principle of our business model is to train and maintain a
dedicated core crew on all our vessels. This creates value by
retaining operational and vessel knowledge between charter
or project crew changes and leads to a higher level of safety,
eciency and quality of services, benefiting the Group, our
clients and our workforce. The program creates value for
individuals, their families as well as local governments and
society by creating jobs, assisting in enterprise development
and technology transfer to local communities.
DOF’s global maritime cadetship program combines the princi-
ples of a fair return for our local communities with building a
skilled and sustainable workforce. This program gives cadets a
structured path to gain qualifications and a long-term livelihood.
Involvement in the Norwegian Training Centre - Manila
(NTC) cadet program has been part of DOF’s strategy to pro-
vide highly qualified ocers to our fleet. The courses extend
across the complete area of vessel operations. The aim is to
train seafarers to the highest standard of safety and quality
and promote excellence in maritime operations worldwide.
DOF joined other Norwegian ship-owners who founded AEPM
in Brazil to provide opportunities for young adults to start
maritime careers via ordinary seamen courses.
Community support is focused on promoting education, cul-
ture and sports through a number of specialist organisation’s
structured programs, primarily in Brazil and Philippines, to
give underprivileged children a chance for a better future.
For example, DOF provides Sponsorship to the Renascer foster
institute (Brazil), an organisation which cares for children of one
to five years old, presenting them new life perspectives through
sports, art and music, providing them with a home, food and shelter.
We remain very close the community of Comatin (Philippines)
since DOF and partner OSM rebuilt the Elementary School after
a typhoon in 2013.
Ta x
The DOF Group aims to achieve excellence in all its operations
in every jurisdiction in which it operates. By providing a
Tax Strategy, the DOF Group aims to ensure that all tax
obligations are complied with in a timely, ecient and cost-
eective manner, in all project locations.
The DOF Group is mindful of its responsibility and commit-
ted to paying the amounts of tax legally due in any country in
which it operates, in compliance with applicable laws and con-
ventions and in accordance with DOF’s Code of Business Conduct.
The DOF Group Tax Strategy, available on the DOF website,
provides further details concerning DOF’s approach to tax.
Strengthened the pursuit of new lines of business
The changing and evolving of DOF line of business will
have to continue through 2022 and build upon the various
strategy business plans in close interaction with the DOF's
DigiTech environment established in 2021.
The main focus in 2022 will be to follow the business
strategy plan developed and continue investment in people
and technology. DOF aim to be a wind – floating, one stop
shop, supporting the total life of field: from pre-construc-
tion, construction, operations and maintenance and finally
to decommissioning. This calls for strong cooperation and
alignment with (among others) our global survey environment.
Several new positions have been identified to strengthen the
Business Development, as well as technical lead to be hired
during the year. During the year a review will be done to
investigate possibilities to document DOF's oshore wind
capabilities by a certificate issued by DNV.
The Company will continue building track records within
SURF and execute the market plans will be main focus for
2022. We will continue to build competence and capacity
within the area by hiring new employees.
Within mooring and decommissioning we will continue build-
ing competence, and capacity globally will be achieved by
recruiting new competence. This will also include building
competence in Brazil to be prepared for new opportunities
when the market would like to see turnkey suppliers. The
development of Honey mooring will continue into 2022 both
as R&D as well as partnering with stakeholders both within
oil and gas and oshore wind.
During 2022, the Group will evaluate establishing a centre of
excellence for Survey. The Centre of Excellence focus will be
on the commercial and technical development of the survey
market and continued implementation of One DOF for Inspec
-
tion and Positioning. It will also explore further the market
for Geophysical Survey and Geotechnical Survey services.
Future goals within Prosperity
The DOF has a zero mind-set towards customer complaints
and downtime of our operations. Operating in a challeng-
ing market with pressure to deliver the same services for
less money, DOF appreciates the importance of maintaining
the quality of services. In a complex and demanding world,
excellence is not simply having the best product or service.
DOF will work towards delivering ever-improving value to its
customers, and other stakeholders involved in contributing
to our overall organisational sustainability. The continuous
improvement to the overall organisational eectiveness and
capabilities will position DOF as a partner of choice to both
regional clients and major international clients.
DOF will continue to evaluate and engage with strategic
partners to strengthen existing capabilities and to develop
new capabilities that will allow DOF to expand its range of
ESG FACTBOOK Prosperity
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dof subsea integrated annual report 2021
expenditure, new insights into the data we generate, reducing
unplanned maintenance, and reduction of scheduled main-
tenance which may be unnecessary.
The “SkAIwatch” product gives insights to optimise criti-
cal equipment maintenance planning and decision making.
This can remove the requirement for unnecessary sched-
uled maintenance.
Migration from perceived ‘good performance’ to measurable
performance is key to performance management. We must
gather data and extract value from this data. Analysis of data
via software is an invaluable tool for performance manage-
ment. Today’s technology is moving into capabilities where
e.g. Digital Twins, Machine Learning and Artificial Intelli-
gence are becoming available to a moderate cost, enabling
large improvement and insight to the company’s operations.
We must continuously review the tools we use and maximise
the functionality available in these tools in order to identify
improvements possible in our performance in both short and
long term. The following activities will be done in 2022:
Utilisation of the CRM solution we use will be reviewed
and new ways of extracting value from the CRM database
will be implemented via increased data input and automated
reporting. The CRM solution will be placed into “life-cycle
management” mode with focus on continuous improvement.
To deliver insights into vessel operational data, investigation
will be done into new cloud-based solutions available from
vendors. This is commonly known as ‘Maritime 4.0 Plat-
form”. These solutions are designed to provide maximum
availability of our data and a range of analysis and report-
ing software is available to help us gain insights into vessel
performance. DOF will investigate the vendor landscape and
combine that with the strategy and future needs for DOF in
order to choose future platform for these initiatives.
The existing “SkAIwatch” product was installed on the global
fleet in 2021. In 2022 it will be enhanced to include aspects
of machine learning to improve trend analysis in insights.
This will be delivered via a new version of this important
software solution.
Subsea Robotics
Subsea Robotics encompasses subsea vehicles with robotic fea-
tures, such as the classic work class ROV, AUV, and newer types
of subsea vehicles designed for data acquisition and intervention.
Subsea robotic vehicles have been used to perform task
which divers and people cannot perform. Increasingly, with
improvements in battery and subsea communications tech-
nologies, the capabilities are growing. New possibilities are
appearing in relation to remote control, digital imaging, opti-
cal imaging, and other techniques. DOF need to have these
capabilities to remain competitive and relevant.
In 2022, DOF will start preparation work for onshore pos-
sibility of remote operation of ROV / LARS, including proof
of concept for DOF future ROV operations.
services and align with the needs of international clients.
Modern Information Technology
New possibilities are made available by introducing modern
IT tools both to the onshore and oshore organisations, and
in combination with each other. Implementation of these
new products, supported by new company Standards, can
ensure resilience against the growing wave of cyber threats,
increase eciency, and change how we can leverage new ves-
sel connectivity. A modern IT platform is crucial for further
implementing new digital tools and ways of working, as a
part of the Maritime 4.0 initiatives.
Business continuity is key for sustainability of the company
and the work force. Increased and proportionate focus on
cyber security will directly contribute to business continuity
and avoid operational disruption, financial risks, and reduce
threats to business continuity and sustainability.
Leveraging modern systems oshore, with sight on remote
operations and reducing the ‘distance’ between vessel and
shore will increase quality and availability of communica-
tions to vessels. New connectivity to our vessels will result
in tighter project integration with vessel sites, new availabil-
ity of vessel and project data onshore, and increased usage
of secure cloud systems to support operations and enable
new possibilities. Stability and increased availability of ves-
sel connectivity will be key targets.
Modern IT solution will enable new possibilities such as the
Maritime 4.0 Platform for Performance Management.
Investment will be made on new standardised IT systems
for installation on vessels. These will be tightly coupled with
evaluation and installation of modern connectivity solutions.
The following activities will be done in 2022:
The existing “Cyber Security Standard” will be reinforced,
and IT equipment will be implemented on board vessels to
reduce risk and gain increased awareness of risk.
The new “Vessel IT-C Platform” product will be created and
implemented to modernise vessel IT systems and deliver
the new ship-to-shore connectivity required by DOF Group.
A total of 40 vessels are targeted for implementation in
2022 (pending on operational planning and vendors deliv-
ery capabilities).
Performance Management
Performance Management can be defined as the continuous
process of maximising the benefits delivered to the business
of the resources the company has at its disposal. In the con-
text of digitalisation, this means the technical solutions we
use today and wish to use tomorrow, for example, software
and hardware, both from IT-systems and OT-systems. This
is defined as Industry 4.0, or the fourth industrial revolution.
In maritime terms, this are often referred to as Maritime 4.0.
If we manage performance of our equipment and resources,
we can maximise the return on investment in these items.
Benefits include reduced fuel consumption and operational
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dof subsea integrated annual report 2021
Principles
Our company value that is directly connected to principles:
INTEGRITY
“We are honest, fair and equitable in all our dealings. We are dedicated to good
corporate governance. We strive to do the right thing not because someone is
checking, or looking, but purely because it is the right thing to do.”
Stakeholders rightly expect good governance, integrity and ethical practices
to be evidenced at all levels of DOF’s organisation and operations. Upholding
standards aligns with UN's Global Compact and Sustainable Development
Goals, ensures decent work, generates wealth for employees, local communities,
and along our supply chain as well as wider society by generating taxes.
Upholding our position within the top 5 for environmental and social
sustainability in our industry is a strategic objective in the next 3-year
strategic period and a driver for value creation. Through Integrity we aim to:
• Maintain DOF’s reputation as a responsible and competent partner,
demonstrating the highest level of integrity in all our activities. Promote
fair and honest relationships with all stakeholders through consultation
and engagement.
•
Continue to deliver value to all stakeholders and wider society by provid-
ing clients with subsea and marine solutions that meet client expectations
and contractual obligations. Here, ‘repeat business’ is strong indicator of
client confidence and helps us win future contracts.
Our global community is witnessing the escalating conflict in Ukraine, and
we see the repercussions of fractured tensions in international cooperation.
2022 will undoubtedly be a year that requires strong global governance and
eective risk management eorts. Crises prompt unexpected and unpredictable
paths, as exposed by COVID-19. DOF will continue enforcing our Values
as guiding principles of good corporate governance and behaviour. Having
recognised reference points, like our company Values and Code of Business
Conduct is essential to navigating DOF through the volatile, uncertain,
complex, and ambiguous challenges we will see unfold in the coming year.
Within Principles, we apply our values
to define significance,
guide our approach, assess our results, and set the ambitions into our future.
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dof subsea integrated annual report 2021
2021
2021 activities within Principles
Everyone shares the commitment to practise the highest
standards of ethical business conduct and integrity in all
decisions, and actions. Values-based training is mandatory,
including our Code of Business Conduct e-learning module,
compliance activities and the correct use of our manage-
ment systems and tools.
To ensures external providers align with our values and
policies, the Group has invested in a more ecient, digital
platform to conduct vendor evaluation which is also designed
to ensure principles are upheld along our supply chain. The
vendor evaluation is mandatory for all suppliers and will pro-
duce a master supplier database in Unit 4 ERP.
Compliance to Law, Industry Standards, and local regulations
Operating globally DOF works to comply with regulations at
both national and local levels.
Guided and inspired by international laws, DOF is in front
to uphold the highest standards within integrity:
• US Dodd Frack Act
• California Supply Chain Transparency Act
• UK Modern Slavery Act
• France Duty of Vigilance Law
• Australian Modern Slavery Bill
• Netherland Child Labour Due Diligence Law
• Germany Supply Chain Due Diligence Law
• EU Conflict Mineral Regulation
• Norway Transparency Law –“Åpenhetsloven”
• DOF personnel and subcontractor compliance
All DOF personnel and subcontractors are required to comply
with applicable legislation, regulations and standards as well as
client’s requirements. The legislation, standards, codes of practice
and guidelines register provides a list of applicable requirements.
Each region has developed registers of applicable legisla-
tion, standards, codes of practice and guidelines. When DOF
operates in areas where legal requirements are weak, all oper
-
ations are to follow our policies and operational standards.
DOF’s Management System is based upon ISO 9001:2015, ISO
14001:2015 and ISO 45001:2018. The system is accredited by DNV.
All legislative requirements are listed in the regional Legisla-
tion and Other Requirements Compliance Register according
to pre-identified areas for the compliance analysis.
The company subscribes to regular updates from legal data-
bases, and register is being updated accordingly. Compliance
with the requirements is verified during internal reviews,
inspections, third party reviews, internal and external audits.
Anti-Bribery & Corruption
In 2021, DOF continued the practice of evaluating vendors
to assess their suitability to meet DOF’s requirements for a
competent and reliable vendor. A key and mandatory element
of the assessment process is the requirement for the vendor
0
Fines
There have been no significant fines or non-
monetary sanctions due to non-compliance.
0
Corruption cases
There have been no corruption cases
in 2021.
Compliance
Awareness
A compliance awareness programme
has been developed and available to
the entire organisation.
UN Global Compact
DOF's supplier evaluation program is
based on the ten principles in the UN
Global Compact, covering the areas:
Human Rights, Labour Conditions,
External Environment, Anti-Corruption.
Ethics Helpline
DOF has a 24/7 Ethics Helpline,
available for people inside and outside
the organisation. Reports can be
made anonymously, and the service
is managed by a third-party provider.
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dof subsea integrated annual report 2021
2021
to declare their commitment to abide by DOF’s Anti-Bribery
and Corruption guidelines. Failure to comply will automati-
cally exclude the vendor.
Transparency - Traceability - Trust
DOF’s anti-corruption and anti-bribery measures are regu-
larly evaluated in order to ensure that sucient measures
are in place and oversight responsibility sits with the BoD.
Risk and opportunity management
Risk and opportunity management is imperative to all DOF
business activities. The Risk Management Manual helps
DOF to identify threats and opportunities associated with
the DOF business and operational activities and establish
ecient means of barriers and controls in all phases of the
business life cycle. The Risk Management principles and
techniques align with the following:
• ISO 31000: Risk management -- Principles and guidelines;
•
ISO 31010: Risk management -- Risk assessment techniques;
• ISO 17776: Guidelines on tools and techniques for hazard
identification and risk assessment;
• DNV RP-H101: DNV Recommended Practice – RISK man-
agement in marine operations.
Modern Slavery Act and Human Rights
The Vendor Evaluation and Recertification process incor-
porate requirements to ensure that all existing and future
vendors to DOF agree to abide by the principles of the Act,
and that they do not promote or carry out any unlawful
human rights practices, as covered in the Modern Slavery
Act 2015, and also ensure that all vendors do not engage in
any type of human tracking, child or forced labour prac-
tices, etc., whilst doing business with DOF. Suppliers will
be required to provide DOF with a Transparency Statement
stating their position with regards to the Act and associated
Human Tracking and related exploitation practices, or a
declaration that they will abide by DOF’s Code of Business
Conduct. Failure to comply with this requirement will auto-
matically exclude the vendor.
The new Norwegian Transparency Act will come into force
during 2022. DOF's operations has been guided by its prin-
ciples for years and it will be useful in motivation of our
supply chain to intensive their eorts within this area.
Training
DOF has incorporated specific training such as Anti-Bribery
& Corruption into its training programme. Also, where
necessary, DOF is committed to training all stakeholders
within its supply chain to understand the practical and legal
aspects of DOF’s Code of Business Conduct requirements,
and the possible implications and the consequences to DOF
and themselves of failing to comply with DOF’s requirement’s
and legislative obligations.
Through DOF IMCA membership we have access to training
material that is tailored for our industry to fight corruption.
The material is developed by Transparency International, the
global coalition against corruption, and active used by our
supply chain and legal function.
Supply Chain Management
The DOF CEO, supported by an executive management team
is responsible for identifying, engaging and where necessary
retaining all necessary financial, technological and organisa-
tional resources required to support the DOF Supply Chain
Management (SCM) global operations.
DOF’s overall SCM system is comprised of three core dis-
ciplines and two support disciplines, interacting with each
other as shown in Figure 14 on page 164. All activities under-
taken within the various supply chain functions meet the
following criteria:
•
The best interest of DOF and its partners - Add value to the supply
chain system for the benefit of the Company and its partners.
• Fairness, Integrity and Transparency - To achieve the best
value for money, whilst protecting the Company from un-
wanted and / or illegal practices such as: fraud, corruption,
collusion and other unethical practices.
• Best value for money - Trade-o between price and per-
formance that provides the greatest overall benefit under
the specified selection criteria.
• Eective competition - Ensure where possible, that there
is a sucient number of independent prospective vendors,
allow competition to supply between the vendors, non-dis-
criminatory selection criteria.
Procurement is central to DOF’s overall Supply Chain Man-
agement system. It ensures that all procurement activities
conducted by DOF are performed in a standardised and
controlled manner, consistent with DOF's policies and in
accordance with contractual obligations and client require-
ments and expectations.
The procurement of goods and services is undertaken in
a manner that reduces the level of risk and cost for DOF
and our clients whilst maintain the highest level of qual-
ity, reliability and integrity possible. The process operates
in conjunction with the Contract Management and Logis-
tics management processes to achieve a seamless transition
of information and knowledge that supports all DOF enti-
ties and projects.
In 2021 DOF’s global supply chain, consisted of almost 3,250
suppliers and a significant amount of its procurement spend-
ing was comprised by bunkering, lay spread equipment, crew
agency services, specialised equipment hire, employee travel,
vessel hire among other services.
In 2021 the regional split for suppliers was as follows:
Asia-Pacific 18%, Atlantic 48%, North America 12%, and
South America 22%.
Risk and Opportunity Management
DOF has an active approach to future risk and opportunity man-
agement and strives to clarify its long-term potential, including
strategy, value drivers and risk factors, to its main stakeholders.
To produce lasting value for its stakeholders, and a long-term
competitive return on the investment of its shareholders, the
Board of Directors and the Management regularly evaluate
ESG FACTBOOK Principles
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dof subsea integrated annual report 2021
2021
long-term risk and opportunity and potential impact on stra-
tegic decisions taken today.
DOF’s policy is to continue to invest in the local communi-
ties in which it operates. This includes investing in training,
building the technical competencies of our employees and
focusing on a local workforce.
DOF’s operations are based on asset investments with a long-
life span, of up to 30 years. DOF’s policy is to have a modern,
multi-purpose fleet, renewing and converting over time to
implement new technology and maintain an attractive, energy
ecient fleet to serve our customers and potential new markets.
To be a long-term marine and subsea supplier for oshore
industries DOF maintains a cohort of asset, marine and
subsea engineering competency, inhouse. There is potential
for DOF to continue to build on these core capabilities to
access opportunities in oshore renewable energy projects.
Balancing risk and opportunity is a key concept for DOF.
Operations range from low risk areas, such as long-term ves-
sel charter, balanced with more complex operations for subsea
project delivery. DOF further diversifies its risk exposure in
today’s global oshore energy market by having established a
global footprint, a presence in promising markets and excel-
lent customer relations. DOF is committed to maintaining
a focus on diversifying its risk exposure and adapting to
changing landscape of risk and opportunities.
Within DOF Subsea, the distribution of risk between Sub-
sea and IMR projects and long-term charter has been quite
stable over the last three years (ref. Figure 1 on page 159).
Subsea and IMR projects are normally regarded to have a
higher risk profile compared to long-term chartering of ves-
sels. The distribution of project levels is outlined in Figure 1.
By using local suppliers and infrastructure, we support many
companies and organisations that are outside the DOF core
business, although vital to deliver successful operations to
our clients. It is dicult to quantify the exact monetary
value of this contribution; however, a conservative estimate
is that one DOF employee creates one job position outside
of the organisation. This estimate is based on various stud-
ies performed by the energy industry trade organisations.
The Board of Directors, in its assessment of the scope and
volumes of dividend, emphasises security, predictability and
stability, dividend capacity of the Company, the requirement
for healthy and optimal equity as well as adequate financial
resources to create a basis for future growth and investment,
and considering the wish to minimise capital costs.
Full compliance
with all processes
Full compliance
with all processes
Partial compliance
consistent with risk level
Partial compliance
consistent with risk level
Minimum reviews
LEVEL LEVEL LEVEL LEVEL LEVEL
Manpower or
equipment Hire
Working on
client vessel or
PM&E contract
Vessel charters
or Minor IMR
campaign
Light
construction or
IMR
Major
Construction /
Intervention
projects
Degree of project complexity / Risk
Degree of control required
Overall risk management process in DOF is the balance between complexity of risk and complexity in a project, and degree of controls.
The figure above gives a visual view on how project levels are combined with what part of the business management system that need to apply.
Degree of complexity / risk compared to degree of control required - Figure 6
159
dof subsea integrated annual report 2021
2021
2021 results within Principles
During 2020, major activities have been initiated to strengthen
the integrity of the Group.
Tax strategy: At the beginning of 2021, the DOF tax strat-
egy was rearmed and approved by the Board of Directors.
The tax strategy is available on www.dof.com.
Supplier evaluation: Continued implementation of the vendor
evaluation database. Close to 600 suppliers were evaluated
during 2021; resulting in a total of 1,100 since DOF started
using the database.
Privacy and General Data Protection Regulation (GDPR): One
privacy breach with limited impact was recorded in 2020.
The incident was not subject to GDPR, and was reported to
local authorities in the area.
DOF Tax Strategy
DOF aims to achieve excellence in all its operations across
every jurisdiction in which it operates. By providing a Tax
Strategy, DOF ensures that all tax obligations are complied
with, in a timely, ecient and cost-eective manner, in all
project locations.
DOF is mindful of its responsibility and is committed to pay-
ing the amounts of tax legally due in any country in which
it operates, in compliance with applicable laws and conven-
tions and in accordance with the Code of Business Conduct.
The strategy aims to demonstrate good corporate practice in
the area of tax management and tax transparency, balancing
the interests of the various stakeholders, including custom-
ers, shareholders, employees and society at large.
Governing Documents
Besides the Code of Business Conduct (COBC) further improve-
ments were made to communicate DOF’s ethical guidelines
and business conduct with the release of an updated elec-
tronic training module made available to and mandatory for
all employees. The COBC sets clear expectations on all employ-
ees, and provides examples of dilemmas that our people may
encounter. The training is also publicly available at www.dof.com.
Additionally, executive and middle management receive regular
training regarding anti-bribery and anti-corruption measures.
During 2021, the reporting mechanism for compliance inci-
dents has been actively used on both local and Group level,
and compliance incidents were handled and concluded in
accordance with the requirements in the policy framework.
Legal compliance 205-3 / 206-1
In 2021, there were no confirmed incidents of corruption,
and there was not any legal action pending or completed
regarding anti-competitive behaviour, anti-trust or monop-
oly practices against DOF.
Operations assessed for risks related to corruption 205-1
In regions with a high risk for Bribery and Corruption, DOF
has used the know-how of DOF Subsea UK, subjected to
the ruling of the Bribery Act 2010, to frame the approach
to Bribery and ethics.
Bribery Risk Assessments for the Group’s operations (busi-
ness units) are performed and recorded on a regular basis,
given the risk potential.
However, risks identified out with the formal Risk Assessment
on an ad hoc basis will be added and analysed as appropri-
ate by Regional HSEQ Managers in all the locations where
DOF operates.
In addition, assessment related to Business Integrity and
Ethics is mandatory in all projects identified as level 3 and
above. In 2021, out of 104 projects, 74% were within levels
3-5, and consequently assessed for risks related to corrup-
tion. There were no significant risks identified that had not
already been treated by existing DOF standards and policies.
Control and mitigation required is based upon project risk
and complexity (Figure 1 on page 141).
Risk and Opportunities associated with business integrity,
anti-bribery and corruption, were evaluated as part of the
materiality workshop performed in 2021. Outcomes from
the workshop showed that whilst these topics were a mate-
rial concern to some of our stakeholders, they were not
assessed as ‘significant material topics’ due to robust con-
trol measures being in place. Nevertheless, DOF considers
the ongoing prevention of bribery and business ethics risks
to be of the utmost importance across our value chain.
It should be noted that this level of control against busi-
ness ethics and bribery risk is applicable to DOF level. At
business unit and worksite levels of the organisation, it is
necessary for measures to be implemented to manage com-
pliance against local risks and requirements.
In the UK, DOF follows the ruling of the Anti-bribery act
of 2010, and in other regions were DOF operates, a detailed
process is followed according to guidelines for Business Acqui-
sition in DOF, including Legal Contractual Risk Assessment,
Commercial Risk Assessment, Technical Risk Assessment
and Insurance Review.
Risks identified related to corruption may vary according to
the activity the Company is engaged in. For example, dur-
ing the tender selection key risks encompass facilitation
payments, excessive hospitality and excessive promotional
expenditure, to provide a client with excessively luxurious
accommodation or transportation and oer of favourable
prices in return for a personal gain.
Donations and sponsorships are organised in a transparent
way and are regularly checked and audited by external bod-
ies such as PwC and equals.
A typical donation can be to an athletic organisation where
ESG FACTBOOK Principles
160
dof subsea integrated annual report 2021
2021
DOF donates a fixed sum for sponsoring a sport arrangement.
DOF has its name on posters or clothes and in return the
company will receive an invoice from the athletic club. The
invoice will refer to an agreement. Other sponsorships can
be of named athletics with a half yearly payment. This is
regulated in a joint agreement signed by both parties.
With respect to donations to support bereaved with edu-
cation in case of the death of a DOF employee, a separate
donation committee is organised by external lawyers. As a
gesture, DOF will donate a given sum of money and this
will be followed up by collection given by DOF employees.
In Brazil, DOF donates money to established and reputable
organisations that run schools and educational programs.
These donations are based upon written agreements and
payments are based upon invoices referring to the agree-
ments. The agreements are part of the annual audit scope
performed by external auditors.
In general, all payments in DOF are regulated in the author-
isation matrix. The “four sets of eyes” principle is built into
this. The entire payment process is under strict control and
in case of donations and sponsorship these rules will apply.
Projects on level 3 and above (ref. Figure 6 on page 159) are
assessed regarding risk of bribery and corruption. However,
regional Executive Vice Presidents may deviate from this
requirement by a Management of Change process. Due to this
possibility for deviation, it is currently not possible to obtain
an exact number of projects where bribery and corruption
risk assessment has been done. Going forward, DOF intends
to update routines and processes to capture this information.
Communication and training on anti-corruption policies
and procedures 205-2
DOF’s Business Integrity and Ethics policy is approved by
the Board of Directors. This policy is available on the pub-
lic website, intranet, and posted at all work sites globally. In
addition, the policy is communicated to both suppliers and
clients through the business processes.
The policies are reviewed regularly in management review
at regional and corporate level. Any changes proposed are
given final approval by the Board of Directors.
Introduction training is provided to all employees in DOF,
regardless of their role and position. Four e-learning mod-
ules are mandatory, including a module regarding Business
Ethics and Code of Conduct, which covers many issues regard-
ing anti-bribery and anti-corruption policies. In addition to
completing the module at the start of employment, it must
be completed again every two years. In 2021, approximately
1,500 employees completed the module.
One of the aims is to provide to the executive and middle
management team regular training regarding anti-bribery and
anti-corruption measures. Board members are informed on
a quarterly basis of any cases, changes or results of audits
in the area of Anti-Bribery and Corruption.
Business Integrity and Ethics is a mandatory part of the
yearly appraisal between managers and employees. This is
an important opportunity for monitoring awareness and con-
sciousness of DOF’s values.
Financial implications and other risks and
opportunities for the organisation’s activities due to
climate change 201-2
In recognition of TCFD’s recommendation, DOF has per-
formed a Climate Risk Scenario Assessment and subsequent
report. This builds upon the 2016 Climate Change Risk and
Opportunity workshop, by providing in depth analysis of
physical and transition risks associated with DOF’s inter-
action with climate change.
The Climate Scenario Analysis identified multiple risks and
opportunities associated with three IPCC climate scenarios.
These risks and opportunities were categorised into the fol-
lowing areas;
• Physical Risks;
• Transition Risks;
• Policy and legal;
• Technology;
• Market;
• Reputation.
The above analysis evaluated both direct and indirect risks
and opportunities to DOF’s Value Chain associated with Cli-
mate Change Scenarios.
At this stage, DOF has recognised the a forementioned risks
and opportunities using qualitative descriptors. Quantitative
and financial implications have yet to be established, beyond
theoretical descriptions outlined within the report.
Coverage of the organisation’s defined benefit plan
obligations 201-3
From 2021, there are no longer any defined benefit plans
in DOF.
For defined contribution plans, DOF pays contributions to
publicly or privately administered pension insurance plans
on a mandatory, contractual or voluntary basis. DOF has no
legal or constructive obligations to pay further contributions
if the fund does not hold sucient assets to pay all employ-
ees the benefits relating to employee service in the current
and prior periods.
The contributions are recognised as employee benefit expense
when they are due. Prepaid contributions are recognised as
an asset to the extent that a cash refund or a reduction in
the future payments is available.
Coverage of the organisation’s defined benefit plan
obligations 201-3
From 2021, there are no longer any defined benefit plans
in DOF.
For defined contribution plans, DOF pays contributions to
161
dof subsea integrated annual report 2021
2021
publicly or privately administered pension insurance plans
on a mandatory, contractual or voluntary basis. DOF has no
legal or constructive obligations to pay further contributions
if the fund does not hold sucient assets to pay all employ-
ees the benefits relating to employee service in the current
and prior periods.
The contributions are recognised as employee benefit expense
when they are due. Prepaid contributions are recognised as
an asset to the extent that a cash refund or a reduction in
the future payments is available.
Financial assistance received from government 201-4
In 2021, DOF received tax relief / tax credits or subsidies
in some of its areas of operation as part of governmental
COVID-19 relief measures for businesses.
The government is not present in the shareholding structure.
Norway
• Tax credit in relation to R&D projects
» NOK 7 million received in support from Innovasjon
Norge for Intelligent Eciency project by end of
2021.
» NOK 85 thousand received in tax credit related
to development of technique for remote survey
operations.
Singapore
• Subsidies
» USD 40 222
» SGD 14 077
UK
• Other financial benefits
» GBP 3,000 Employment Allowance
Canada
• Other financial benefits
» CAD 6,000 Government of Newfoundland &
Labrador Student Mentorship Agreement
USA
• Other financial benefits
» In 2020, the company received a Small Business
Administration Payroll Protection Program loan of
USD $2,342,292. In 2021, the company received a
second draw on this loan of $2,000,000. Both of
these amounts were confirmed to be 100% forgiven
in 2021.
Commitments to external initiatives
DOF endeavours to comply with recognised industry stand-
ards and guidelines published by various organisations
connected to the oil & gas industry, such as International
Maritime Organisation (IMO), International Marine Con-
tractor Association (IMCA), International Association of
Oil & Gas Producers (IOGP), International Organisation for
Standardisation (ISO), and class societies (DNV, Lloyd’s etc.).
In the marine segment, a robust system is also in place to
allow that vessels and oshore personnel comply with laws
and regulations in the locals of operation.
DOF’s Integrated Management System (IMS) is based on com-
pliance with IMO regulations and audited and approved by DNV.
A Document of Compliance certificate is issued. An annual audit
is conducted to verify that the Company complies with the
requirements of the International Management Code for the Safe
Operation of ships and for Pollution prevention. The DOF inter-
nal audit program is annually updated to ensure updates on new
regulations are implemented and adhered to in the Company.
All the vessels owned by DOF are audited regularly by DNV
GL under the same IMO legislation, vessel-by-vessel. Addi-
tionally, vessels are audited under the internal audit program.
DOF Management utilises DNV Navigator, which provides
regular updating of all IMO legislation and flag state require-
ments on vessel. Any changes in legislation as well any
vessel re-certification is communicated daily to our managers.
In 2013, DOF Management successfully implemented the
Marine Labour Convention (MLC) on all NIS / NOR, BAH,
Cyprus and IOM flagged vessels. In addition, vessel managers
ensure that all DOF vessels comply with the SOLAS regu-
lations for Life Saving Appliances (LSA) and Fire Fighting
Equipment on board and that masters and ocers are given
the required training to operate in safety.
Memberships of associations 2-28
In order to facilitate interaction and collaboration with dif-
ferent sectors of the oshore industry, DOF is an active
member of many industry associations in the locations where
it maintains operations. In addition, there is regular partic-
ipation by DOF’s representatives in projects or committees
of those associations.
The International Marine Contractors Association (IMCA)
is the international trade association representing compa-
nies and organisations engaged in delivering oshore, marine
and underwater solutions. DOF has been an IMCA member
for many years and has been an International Contractor
member since 2015. DOF has representatives in vice chair
positions in the Digitalisation Committee, and in the Envi-
ronmental Sustainability Committee.
IMCA defines the International Contractor membership as follows;
“International Contractor - ICO This category of membership
has been developed for contractors who have an international
presence -operating in 3 or 4 of the IMCA regions - as o-
shore oil and gas construction contractors. Such companies
should be able to demonstrate their marine construction
capability, set out their geographical presence and their com-
mitment and involvement with IMCA.”
DOF Subsea APAC
•
APPEA (Australian Petroleum Production & Exploration Association)
• Subsea Underwater Technology (SUT)
ESG FACTBOOK Principles
162
dof subsea integrated annual report 2021
2021
• Subsea Energy Australia
• Industrial Foundation for Accident Prevention (IFAP)
•
Oshore Project Safe - Steering Committee member (Region EVP)
DOF Subsea UK
• British Safety Council
• Subsea UK
• Oil and Gas UK
DOF Brasil
• Abespetro (O&G Association)
• Abeam (Shipowners / Vessel Operators Association)
• Syndarma (Shipowners Union)
• Abran (NSA - Norwegian Shipowners Association)
• NBCC (Norwegian-Brazil Chamber of Commerce)
• AEPM (Association for the Specialisation of the Seafarer)
DOF ASA
• Norwegian Shipowners Association
• Bergen Shipowners Association
• Norwegian Church Abroad – Global ERT membership
• The Bergen Chamber of Commerce and Industry
DOF North America
• American Society of Safety Engineers - ASSE
• International Organisation for Safety and Health - IOSH
• International Association of Drilling Contractors - IADC
Incidents of violations involving rights of indigenous
peoples 411-1
DOF has not identified incidents of violations involving the
rights of indigenous peoples in 2021.
Compliance 419-1
In 2021, there were no significant fines or non-monetary
sanctions related to fraud, corruption or workplace discrim-
ination under the jurisdictions where DOF operates.
Operations and suppliers in which the right to freedom of
association and collective bargaining may be at risk 407-1
DOF’s Equal Employment Opportunity Policy recognises
and respect employees’ rights to freely associate, organise
and bargain collectively in accordance with the laws of the
country in which they are employed. It has not been iden-
tified that these rights may be at risk for employees in any
of DOF’s operations.
In the supply chain, 230 suppliers evaluated in 2021 stated
that they source their products/services from at least one
country that is rated 4 or higher on the ITUC Global Rights
Index related to violation of workers rights.
Operations and suppliers at significant risk for incidents of
child labour 408-1 | Operations and suppliers at significant
risk for incidents of forced or compulsory labour 409-1
As stated in the DOF ASA Human Rights and Slavery statement,
the Group follows a practice, which conforms to interna-
tional standards for human rights, and Group operations are
managed in accordance with fundamental labour standards.
Our guidelines and standards are based on the ILO Conven-
tion that prohibits all use of forced labour or child labour.
In the supply chain, 7 suppliers evaluated in 2021 stated
that they consider high risk to UN Global Compact prin-
ciples regarding working conditions in at least one country
where they source products/services. Among these princi-
ples is principle 4: the elimination of all forms of forced
and compulsory labour, and principle 5: the eective aboli-
tion of child labour.
Supplier screening 414-1 & 308-1
DOF vendor evaluation questionnaire is comprised of two
parts. The first part concerns anti-bribery and corruption,
and additional questions based on the UN Global Compact,
which asks the supplier to rate their risk towards breaches
of the principles. All vendors must complete the first part
of the questionnaire. The second part is largely related to
management systems (Occupational Health & Safety / Qual-
ity / Environmental). In 2021, 573 suppliers completed the
questionnaire. This equals to 17.6% of suppliers used in 2021.
Including questionnaires prior to 2021 this figure equals to
34.3% of suppliers.
204-1 Proportion of spending on local suppliers
DOF utilises a global supply chain with suppliers that have
a global presence. In this context, to determine spend on
local suppliers, a local supplier is defined as supplier located
in the same country as the DOF entity that performed the
transaction. In 2021, the proportion of spending on local
suppliers (per DOF region) was as follow:
• Asia Pacific: 57%
• Atlantic: 57%
• North America: 83%
• South America: 78%
414-2 Negative social impacts in the supply chain and
actions taken
DOF did not identify any actual negative social impacts in
the supply chain in 2021. Regarding suppliers assessed for
potential negative social impact, the supplier screening pro-
cess also concerns risk for negative social impact (ref. 407-1,
408-1, 409-1, 414-1).
Political contributions 415-1
As per the Business Integrity and Ethics policy, DOF does
not allow payments to political parties, organisations, or
their representatives. There were no financial or in-kind
political contributions made directly or indirectly by the
organisation in 2021.
2022 focus within Principles
•
Continue to apply the new ISO 37001 standard to structured
governing documentation to achieve the highest standards
163
dof subsea integrated annual report 2021
2022
within Anti-Bribery management system.
• All Whistleblowing incidents will be captured and demon-
strated as resolved in line with Group polices and inter-
national standards.
• A new database will be introduced, for identifying, recording,
assessing and controlling risks through all our activities to
ensure visibility at all appropriate levels within the organisation.
• Continue to strengthen the global legal function in DOF
combining legal, tax and insurance with a global perspective.
• New strategic objective: Maintain position within top 5 in
social and environmental sustainability in our industry.
• Active promotion of Amnesty e-learn module inside as
well outside DOF.
• Update and revise the Code of Conduct.
Anti-Corruption
The global industry is highly vulnerable to corruption and
the demand of facilitation payments in certain operational
areas. A vulnerability that increases with the widespread
use of agents, brokers and intermediaries in the industry.
DOF’s governing documentation and reporting addresses
how the company manages corruption risk and be transpar-
ent about challenges.
During 2022 DOF will make IMCA’s anti-corruption e-learning
course available for the organisation, and it will be manda-
tory for selected employees in the Group.
Norwegian Transparency Act
On July 1st 2022 the Norwegian Transparency Act will enter
into force. As one of very few countries in the world, enter-
prises operating in Norway will have to prove that their
supply chain follows fundamental human rights and decent
working conditions. A lack of observation of the Act will
be pursued by sanctions such as enforcement penalties and
infringement penalties.
DOF has been part of the ocial hearing process on the
new law and given concrete proposal on practical means to
obey the intention of Transparency Act based on our expe-
rience on how we deal with fundamental human rights and
decent working conditions.
Accountability and Transparency
The industry’s supranational nature implies that it is some-
times challenging to select a level of public disclosures which
satisfies all relevant audiences. However, and also recognis-
ing the Transparency Act, it is important to explain how
the company’s governance structure safeguards compliance
with legal requirements, potential sanctions and industry
standards, and how the company ensures accountability and
transparency in its operations and partnerships. DOF will
include this information in the Integrated Annual Report.
EU Taxonomy
Work will be initiated to prepare the Group to a future where
taxonomy is an integrated part of finance and accounting.
Privacy
A global compliance review will be performed of privacy leg-
islation in the countries where DOF have worksites (such
as GDPR in Europe and LGPD in Brazil). Although DOF
applies GDPR globally, there may be local deviations, and
it is also necessary to be aware of any ongoing changes to
privacy legislation.
Future goals within Principles
During next year a full review of our Code of Business Con-
duct will be made. DOF will continue enforcing our Values as
guiding principles of good corporate governance and behav-
iour. Having recognised reference points, like our company
Values and Code of Business Conduct is essential to nav-
igating DOF through the volatile, uncertain, complex, and
ambiguous challenges we will see unfold in the coming year.
Industry Leader: to leverage global assets, knowledge and
operational expertise, to strengthen the position and progress
towards being recognised as an industry leader capable of deliv-
ering large scale projects that add benefit to all stakeholders.
Global Partner of Choice: working with global operators, as
a committed and reliable organisation that can supply inte-
grated services and work in partnership to develop optimum
solutions for the benefit of both organisations, and other rel-
evant stakeholders.
Equally important, is DOF’s approach to forming strategic part-
nerships arrangements with its own supplier and contractors. The
intention is to develop a more cost eective and ecient supply
chain, regionally and globally, to benefit DOF and our clients.
United Nations Guiding Principles on Human Rights
and Business
In late 2019, DOF was invited to participate in a project
coordinated by the Rafto Foundation for Human Rights. This
project has been named “Future Proof” and develops tools
for businesses in the Bergen area to implement the United
Nations Guiding Principles on Human Rights and Business,
which will continue to develop throughout 2022. Through
participation, we gained a new and deeper understanding of
UN’s Global Compact and SDGs which will guide us in fur-
ther integrating Human Rights into our operations.
Amnesty International’s recent acknowledgment placing DOF
among the top 5 global companies based in the Nordics, not
only demonstrates our commitment to the core principles of
human rights, but that we are on the right track. Amnesty
International has also invited DOF to participate in the devel-
opment of an online learning tool to increase awareness and
knowledge within Human Rights and Business. The training
modules were finalised last year and will be made mandatory
for DOF's employees within Supply chain and all managers.
We will actively make the training available for our supplier.
ESG FACTBOOK Principles
164
dof subsea integrated annual report 2021
165
dof subsea integrated annual report 2021
Appendix B.1 - GRI Content Index for ‘In Accordance’
Appendix B
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON
EXPLA-
NATION
General disclosures
GRI 2:
General
Disclosures
2021
2-1 Organizational details
10-11
2-2 Entities included in the organization’s
sustainability reporting
192
Ye s
2-3 Reporting period, frequency and contact point
01 Jan. – 31 Dec. 2021
Annual
Stig Clementsen, CSO
Ye s
2-4 Restatements of information
None
Ye s
2-5 External assurance
194-195
Ye s
2-6 Activities, value chain and other business
relationships
10-11
No
2-7 Employees
187
No Yes
2-8 Workers who are not employees
187
No Yes
2-9 Governance structure and composition
DOF ASA annual report
No Yes
2-10 Nomination and selection of the highest
governance body
DOF ASA annual report
No Yes
2-11 Chair of the highest governance body
DOF ASA annual report
No Yes
2-12 Role of the highest governance body in
overseeing the management of impacts
DOF ASA annual report
No Yes
2-13 Delegation of responsibility for managing
impacts
DOF ASA annual report
No Yes
2-14 Role of the highest governance body in
sustainability reporting
DOF ASA annual report
No Yes
2-15 Conflicts of interest
DOF ASA annual report
No Yes
2-16 Communication of critical concerns
34-45
No Yes
2-17 Collective knowledge of the highest
governance body
DOF ASA annual report
No Yes
2-18 Evaluation of the performance of the
highest governance body
DOF ASA annual report
No Yes
2-19 Remuneration policies
DOF ASA annual report
No Yes
2-20 Process to determine remuneration
DOF ASA annual report
No Yes
2-21 Annual total compensation ratio
a) 8.40.
b) 3.54 (decrease)
Based on information on
pages 70, 94.
Ye s
2-22 Statement on sustainable development
strategy
8-9
No Yes
2-23 Policy commitments
Policies are available at
http://www.dof.no/en-GB/
HSEQ/Policies.
No Yes
2-24 Embedding policy commitments
BMS (Business
Management System)
manual available at
http://www.dof.no/en-GB/
HSEQ/HSEQ-
Publications.
No Yes
2-25 Processes to remediate negative impacts
30
No Yes
2-26 Mechanisms for seeking advice and raising
concerns
30
No Yes
2-27 Compliance with laws and regulations
146, 160, 163
No Yes
2-28 Membership associations
162
No Yes
2-29 Approach to stakeholder engagement
29, 176-177
No Yes
2-30 Collective bargaining agreements
137
No Yes
166
dof subsea integrated annual report 2021
Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
General disclosures
GRI 3:
Material
Topics 2021
3-1 Process to determine
material topics
130-131
No
Ye s
3-2 List of material topics
176-177
Ye s
PEOPLE
DOF Material Issue: Business Ethics
Public policy
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
29-30
No 11.22.1 Ye s
GRI 415:
Public Policy
2016
415-1 Political contributions
162
No 1.22.2 Ye s
DOF Material Issue: Employee HSE
Occupational health and safety
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
134-135
No 11.9.1 Ye s
GRI 403:
Occupational
Health and
Safety 2018
403-1 Occupational health and
safety management system
136
No 11.9.2 Ye s
403-2 Hazard identification, risk
assessment, and incident
investigation
136
No 11.9.3 Ye s
403-3 Occupational health
services
136
No 11.9.4 Ye s
403-4 Worker participation,
consultation, and communication
on occupational health and safety
136-137
No 11.9.5 Ye s
403-5 Worker training on
occupational health and safety
135
No 11.9.6 Ye s
403-6 Promotion of worker
health
1435
No 11.9.7 Ye s
403-7 Prevention and mitigation
of occupational health and safety
impacts directly linked by
business relationships
135
No 11.9.8 Ye s
403-8 Workers covered by an
occupational health and safety
management system
135
Ye s Information
unavailable/
incomplete
An exact number of
workers who are not
employees is not
available.
11.9.9 Ye s
403-9 Work-related injuries
136
Ye s Information
unavailable/
incomplete
DOF does not have split
between employees and
works who are not
employees, regarding
injury statistics.
11.9.10 Ye s
403-10 Work-related ill health
N/A
Ye s Information
unavailable/
incomplete
DOF does not have
sufficiently accurate data
for work-related ill health
for employees and
workers who are not
employees.
11.9.11 Ye s
167
dof subsea integrated annual report 2021
Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
DOF Material Issue: Labour Practices
Employment
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
132-133
No 11.10.1,
11.11.1
Ye s
GRI 401:
Employment
2016
401-1 New employee hires and
employee turnover
N/A
Ye s Information
unavailable/
incomplete
There is not sufficient
information on rate of new
employee hires and
employee turnover.
11.10.2 Ye s
401-2 Benefits provided to
full-time employees that are not
provided to temporary or
part-time employees
137
No 11.10.3 Ye s
401-3 Parental leave
N/A
Ye s Information
unavailable/
incomplete
There are not sufficient
details available regarding
parental leave.
11.10.4,
11.11.3
Ye s
Employment
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
132-133 No
11.7.1,
11.10.1
Ye s
GRI 402:
Labor/
Management
Relations
2016
402-1 Minimum notice periods
regarding operational changes
138 No 11.7.2,
11.10.5
Ye s
Training and education
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
132 No
11.7.1,
11.10.1,
11.11.1
Ye s
GRI 404:
Training and
Education
2016
404-1 Average hours of
training per year per employee
138 Ye s
Information
unavailable/
incomplete
DOF does not have a
detailed breakdown in
gender and employee
category for average
hours of training.
11.10.6,
11.11.4
Ye s
404-2 Programs for upgrading
employee skills cand transition
assistance programs
138-139 No
11.7.3,
11.10.7
Ye s
404-3 Percentage of
employees receiving regular
performance and career
development reviews
138 No
NA
Ye s
Diversity and equal opportunity
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
132 No 11.11.1 Ye s
GRI 405:
Diversity and
Equal
Opportunity
2016
405-1 Diversity of governance
bodies and employees
137 No 11.11.5 Ye s
405-2 Ratio of basic salary and
remuneration of women to men
N/A Yes Information
unavailable/
incomplete
DOF does not currently
have a global overview of
ratio of basic salary and
remuneration of women to
men. This is intended to
be in place for 2022
reporting.
11.11.6 Ye s
168
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
Non-discrimination
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
132
No 11.11.1 Yes
GRI 406:
Non-discrimi-
nation 2016
406-1 Incidents of discrimination
and corrective actions taken
138
No 11.11.7 Ye s
PLANET
DOF Material Issue: Energy Management
Energy
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
142 No
11.1.1 Ye s
GRI 302:
Energy 2016
302-1 Energy consumption
within the organization
146 No
11.1.2
Ye s
302-2 Energy consumption
outside of the organization
146 No
11.1.3
Ye s
302-3 Energy intensity 146 No
11.1.4
Ye s
302-4 Reduction of energy
consumption
N/A Yes
Information
unavailable/
incomplete
DOF does not have
sufficient data to connect
reduction in energy
consumption directly to
energy reduction
initiatives.
NA
Ye s
302-5 Reductions in energy
requirements of products and
services
N/A Yes
Information
unavailable/
incomplete
DOF does not have
information available
regarding reduction in
baseline energy
requirements of its
services.
NA
Ye s
DOF Material Issue: GHG Emissions
Emissions
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
142-144 No 11.1.1,
11.2.1,
11.3.1
Ye s
GRI 305:
Emissions
2016
305-1 Direct (Scope 1) GHG
emissions
144-145 No 11.1.5 Ye s
305-2 Energy indirect (Scope 2)
GHG emissions
144-145 No 11.1.6 Ye s
305-3 Other indirect (Scope 3)
GHG emissions
144-145 No Ye s
305-4 GHG emissions intensity 144-145 No Ye s
305-5 Reduction of GHG
emissions
144-145 Yes Information
unavailable/
incomplete
While DOF reports
reduction of GHG
emissions, it cannot be
directly linked to
reduction initiatives.
Ye s
305-6 Emissions of ozone-de-
pleting substances (ODS)
N/A Yes Information
unavailable/
incomplete
DOF does not produce or
export ODS. It may be
present in equipment/
machinery onboard.
MARPOL Annex VI
prohibits deliberate
emissions of ozone
depleting substances.
However, DOF does not
have documentation if
there has been accidental
release of minor amounts.
Ye s
305-7 Nitrogen oxides (NOx),
sulfur oxides (SOx), and other
significant air emissions
N/A Yes Information
unavailable/
incomplete
Ye s
169
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
DOF Material Issue: Supply Chain Management
Supplier environmental assessment
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
23, 158, 163
No NA Ye s
GRI 308:
Supplier
Environmen-
tal Assess-
ment 2016
308-1 New suppliers that were
screened using environmental
criteria
163
No NA Ye s
308-2 Negative environmental
impacts in the supply chain and
actions taken
N/A
Ye s Information
unavailable/
incomplete
DOF does not have
detailed information
regarding negative
environmental impacts in
its supply chain.
NA Ye s
DOF Material Issue: Waste & HAZMAT Management
Waste
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
142-143 No
11.5.1,
11.8.1
Ye s
GRI 306:
Waste 2020
306-1 Waste generation and
significant waste-related
impacts
145-146 No
11.5.2
Ye s
306-2 Management of
significant waste-related
impacts
146 No
11.5.3
Ye s
306-3 Waste generated N/A Yes
Information
unavailable/
incomplete
DOF does not have
accurate information of
waste generated at all
worksites.
11.5.4,
11.8.2
Ye s
306-4 Waste diverted from
disposal
N/A Yes
Information
unavailable/
incomplete
DOF does not have
accurate information on
the further handling of
waste after it is delivered
to waste handling
facilities.
11.5.5
Ye s
306-5 Waste directed to
disposal
N/A Yes
Information
unavailable/
incomplete
DOF does not have
accurate information on
the further handling of
waste after it is delivered
to waste handling
facilities.
11.5.6
Ye s
PROSPERITY
DOF Material Issue: Energy Management
Market presence
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
150-151 11.14.1 Ye s
GRI 202:
Market
Presence
2016
202-1 Ratios of standard entry
level wage by gender compared
to local minimum wage
N/A Yes Information
unavailable/
incomplete
DOF does not have
sufficient data on this for
2021 reporting. It is
however expected to be
available for 2022
reporting.
NA Ye s
202-2 Proportion of senior
management hired from the local
community
158 No 11.14.3,
11.11.3
Ye s
170
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
Ta x
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
154
No 11.21.1 Yes
GRI 207: Tax
2019
207-1 Approach to tax
154
No 11.21.4 Ye s
207-2 Tax governance, control,
and risk management
154 No 11.21.5 Yes
207-3 Stakeholder engagement
and management of concerns
related to tax
154 No 11.21.6 Yes
207-4 Country-by-country
reporting
N/A Yes Information
unavailable/
incomplete
11.21.7 Ye s
Risk balancing
DOF 3: Risk
Balancing
Revenue per business segment
and distribution of project
levels
186 No
Ye s
DOF Material Issue: Human Rights & Community Relations
Local communities
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
25 11.15.1 Yes
GRI 413:
Local
Communities
2016
413-1 Operations with local
community engagement,
impact assessments, and
development programs
N/A Yes Information
unavailable/
incomplete
DOF does not have
sufficient details
regarding local community
engagement, impact
assessments, and
development programs.
11.15.2 Ye s
413-2 Operations with
significant actual and potential
negative impacts on local
communities
152 No 11.15.3 Ye s
DOF Material Issue: Product Design and Life Cycle
Customer Satisfaction
DOF 1:
Customer
Satisfaction
Results of surveys measuring
customer satisfaction
153 No Ye s
Operational uptime
DOF 2:
Operational
Uptime
Operational uptime for vessels
and ROVs
153 No Ye s
PRINCIPLES
DOF Material Issue: Business Ethics
Anti-corruption
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
156-157 No 11.20.1 Ye s
GRI 205:
Anti-corrup-
tion 2016
205-1 Operations assessed for
risks related to corruption
160-161 No 11.20.2 Ye s
205-2 Communication and
training about anti-corruption
policies and procedures
161 Ye s Information
unavailable/
incomplete
DOF does not have
sufficient data to
document communication
and training about
anti-corruption policies
and procedures,
particularly towards
business partners.
11.20.3 Ye s
205-3 Confirmed incidents of
corruption and actions taken
160 No 11.20.4 Ye s
171
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
Anti-competitive behavior
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
156-157
11.19.1 Yes
GRI 206:
Anti-competi-
tive Behavior
2016
206-1 Legal actions for
anti-competitive behavior,
anti-trust, and monopoly
practices
160
11.19.2 Ye s
DOF Material Issue: Business Model Resilience
Economic performance
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
142-143 No
11.5.1,
11.8.1
Ye s
GRI 201:
Economic
Performance
2016
201-1 Direct economic value
generated and distributed
48-101 No 11.14.2,
11.21.2
Ye s
201-2 Financial implications and
other risks and opportunities due
to climate change
161 Ye s Information
unavailable/
incomplete
Quantitative and financial
implications have yet to
be established.
11.2.2 Ye s
201-3 Defined benefit plan
obligations and other retirement
plans
161-162 No NA Ye s
201-4 Financial assistance
received from government
162 No 11.21.3 Ye s
DOF Material Issue: Human Rights & Community Relations
Rights of indigenous peoples
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
156-157 No 11.17.1 Ye s
GRI 411:
Rights of
Indigenous
Peoples
2016
411-1 Incidents of violations
involving rights of indigenous
peoples
163 No 11.17.2 Ye s
DOF Material Issue: Supply Chain Management
Procurement practices
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
156-157 No 11.14.1
Ye s
GRI 204:
Procurement
Practices
2016
204-1 Proportion of spending on
local suppliers
163 No 11.14.6
Ye s
Freedom of association and collective bargaining
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
156-157 No 11.13.1
Ye s
GRI 407:
Freedom of
Association
and
Collective
Bargaining
2016
407-1 Operations and suppliers
in which the right to freedom of
association and collective
bargaining may be at risk
163 No 11.13.2
Ye s
172
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
Child labor
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
18, 158, 163
No NA Ye s
GRI 408:
Child Labor
2016
408-1 Operations and suppliers
at significant risk for incidents of
child labor
163
No NA Ye s
Forced or compulsory labor
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
18, 158, 163 No 11.12.1 Yes
GRI 409:
Forced or
Compulsory
Labor 2016
409-1 Operations and suppliers
at significant risk for incidents of
forced or compulsory labor
163 No 11.12.2 Ye s
Supplier social assessment
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
18, 158, 163 No 11.10.1,
11.12.1
Ye s
GRI 414:
Supplier
Social
Assessment
2016
414-1 New suppliers that were
screened using social criteria
163 No 11.10.8,
11.12.3
Ye s
414-2 Negative social impacts in
the supply chain and actions
taken
163 No 11.10.9
MATERIAL TOPICS FROM SECTOR STANDARD CONSIDERED NOT MATERIAL “NOT APPLICABLE”
Indirect economic impacts
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
Ye s Not applicable DOF’s involvement with
infrastructure
development as a tier 2
contractor is low and
we are not involved with
social impact studies in
this area.
11.14.1
Ye s
GRI 203:
Indirect
Economic
Impacts
2016
203-1 Infrastructure investments
and services supported
Ye s Not applicable DOF’s involvement with
infrastructure
development as a tier 2
contractor is low and
we are not involved with
social impact studies in
this area.
11.14.4
Ye s
203-2 Significant indirect
economic impacts
Ye s Not applicable DOF’s involvement with
infrastructure
development as a tier 2
contractor is low and
we are not involved with
social impact studies in
this area.
11.14.5
Ye s
173
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
Water and effluents
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
Ye s Not
applicable
DOF’s main interaction
with water is seawater
and do not consume
significant fresh water in
production processes.
11.6.1
GRI 303:
Water and
Effluents
2018
303-1 Interactions with water as
a shared resource
Ye s Not applicable DOF’s main interaction
with water is seawater
and do not consume
significant fresh water in
production processes.
11.6.2
303-2 Management of water
discharge-related impacts
Ye s
Not applicable DOF’s main interaction
with water is seawater
and do not consume
significant fresh water in
production processes.
11.6.3
303-3 Water withdrawal Ye s Not applicable DOF’s main interaction
with water is seawater
and do not consume
significant fresh water in
production processes.
11.6.4
303-4 Water discharge Ye s Not applicable DOF’s main interaction
with water is seawater
and do not consume
significant fresh water in
production processes.
11.6.5
303-5 Water consumption Ye s Not applicable DOF’s main interaction
with water is seawater
and do not consume
significant fresh water in
production processes.
11.6.6
Biodiversity
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
Ye s Not applicable When DOF operates in
protected areas for a limited
time with vessel, it is under
the client's governmental
approved environmental
protection plan.
11.4.1
GRI 304:
Biodiversity
2016
304-1 Operational sites owned,
leased, managed in, or adjacent
to, protected areas and areas of
high biodiversity value outside
protected areas
Ye s Not applicable When DOF operates in
protected areas for a limited
time with vessel, it is under
the client's governmental
approved environmental
protection plan.
11.4.2
304-2 Significant impacts of
activities, products and services
on biodiversity
Ye s Not applicable When DOF operates in
protected areas for a
limited time with vessel,
it is under the client's
governmental approved
environmental
protection plan.
11.4.3
304-3 Habitats protected or
restored
Ye s Not applicable When DOF operates in
protected areas for a
limited time with vessel,
it is under the client's
governmental approved
environmental
protection plan.
11.4.4
304-4 IUCN Red List species
and national conservation list
species with habitats in areas
affected by operations
Ye s Not applicable When DOF operates in
protected areas for a
limited time with vessel,
it is under the client's
governmental approved
environmental
protection plan.
11.4.5
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Appendix B.1 (continued) - GRI Content Index for ‘In Accordance’
GRI
STANDARD
OTHER
SOURCE DISCLOSURE LOCATION
OMISSION
GRI
SECTOR
STANDARD
REF. NO.
VERIFI
CATION
REQUIRE-
MENT(S)
OMITTED REASON EXPLANATION
Security practices
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
Ye s Not
applicable
DOF may hire extra
security personnel for
vessels entering high-risk
areas. This occurs rarely
and is thus not
considered a significant
topic.
11.18.1
GRI 410:
Security
Practices
2016
410-1 Security personnel trained
in human rights policies or
procedures
Ye s Not applicable DOF may hire extra secu-
rity personnel for vessels
entering high-risk areas.
This occurs rarely and is
thus not considered a
significant topic.
11.18.2
Customer health and safety
GRI 3:
Material
Topics 2021
3-3 Management of material
topics
Ye s
Not
applicable
DOF operates in an
industry with strict health
and safety requirements
in all operations. In the
context of DOF’s
operations, our approach
to health and safety
impacts are embedded in
our value chain to comply
with requirements from
international and national
regulations, industry, and
customers.
11.3.1
GRI 416:
Customer
Health and
Safety 2016
416-1 Assessment of the health
and safety impacts of product
and service categories
Ye s Not applicable DOF operates in an
industry with strict health
and safety requirements
in all operations. In the
context of DOF’s
operations, our approach
to health and safety
impacts are embedded in
our value chain to comply
with requirements from
international and national
regulations, industry, and
customers.
11.3.3
416-2 Incidents of non-compli-
ance concerning the health and
safety impacts of products and
services
Ye s Not applicable DOF operates in an
industry with strict health
and safety requirements
in all operations. In the
context of DOF’s
operations, our approach
to health and safety
impacts are embedded in
our value chain to comply
with requirements from
international and national
regulations, industry, and
customers.
NA
175
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We have experienced first-hand the fallout of COVID-19 and all the economic and social consequences that come with
it. Like many other World Economic Forum Global Risk Perception Survey respondents, DOF’s activities are subject to
disparities in COVID-19 political responses and divergent economic recovery rates. The economic, geopolitical, public
health and societal fractures that the pandemic risk has accelerated are reported as something likely to delay the
business communities’ response to other global challenges such as climate response, the greening of energy systems,
addressing digital vulnerabilities, and social degradation. Whilst the WEF reports these as ‘Global Challenges’, our
internal workshops translate these topics as material issues to DOF.
A table showing how DOF connects material aspects to company People, Planet, Prosperity and Principles.
Appendix B.2 - Materiality (with People, Planet, Prosperity, Principles)
Principles
Prosperity
Planet
People
Principles
Prosperity
Planet
People
WEF
FRAMEWORK
Validation
by executive
management team
VALIDATION
What ESG impacts
do DOF have?
This approach allows
DOF to look at 'Social and
Environmental Materiality'
across our value chain.
ASSESSMENT
Assessment criteria
- Likelihood of impact;
- Severity of impact;
- Opportunity or potential value creation;
- Nature of threat; long, medium or short term.
External strategic drivers
- Relevancy to Sustainable Development Goals;
- Global Report Initiative topic;
- Industry-specific drivers / Hard and soft law,
- Sector materiality.
Internal strategic drivers
- Area of value chain interaction;
- Existing DOF risk assessments/Significant
environmental aspects;
-
DOF Business Management System Documentation.
CRITERIA
Validation
by executive
sponsors and
the ELT
What ESG issues
could impact DOF?
This approach evaluates
what ESG matters interact
with DOF's ability to
create long-term value for
stakeholders. Otherwise
known as, Financial
Materiality.
Key Interests, concerns and/or expectations
of Stakeholders
- Employees;
- Clients;
- Investors;
- Suppliers;
- Local communities;
- Regulatory authorities;
- Non-Government organisations.
Strategic relevance to DOF
- Likelihood of impact;
- Severity of impact;
- Opportunity or potential value creation;
- Nature of threat; long, medium or short term
176
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Principles
Prosperity
Planet
People
Principles
Prosperity
Planet
People
Employee Health Safety and Security: Managing critical risks
across our value chain.
GHG Emissions:
The main concern is GHG emissions and the ability
to meet broad stakeholder expectations, and also concern over air
pollution emission from ships offshore and in harbour limits.
Supply Chain Management: ensuring responsible practices
throughout our supply chain.
OUTPUT:
TOP MATERIAL ISSUES
Shared Natural and Social Capital
Data Security
Human Rights and Community Relations
Labour Practices
Air Quality Management
Energy Management
Waste and Hazardous Materials Management
Ecological Impacts/Biodiversity
Customer Privacy
Business Model Resilience
Product Design and Life-cycle Management
Management of Legal and Regulatory Environment
Business Ethics
Competitive Behaviour
Critical Incident and Risk Management
OUTPUT:
OTHER SIGNIFICANT MATERIAL TOPICS
Labour Practices: Maintaining value chain and geographical
compliance of standards and practices addressing human rights,
working conditions, labour standards, and labour relations including
freedom of association, collective bargaining, working hours, rest
and minimum age.
GHG Emissions/Impacts of Climate Change: Managing fleet and
organisational preparedness to meet physical and transition risks
and opportunities of Climate Change.
Energy Management: Identifying DOF's role in meeting societal
expectations around the energy transition.
Business Model Resilience:
Maintaining and creating value propositions
that are aligned with the decarbonisation of the industry.
Supply Chain Management: Our capacity to cascade DOF and
wider sustainability principles within our supply chain.
Shared Natural and Social Capital
Data Security
Human Rights and Community Relations
Employee Health and Safety
Air Quality Management
Energy Management
Waste and Hazardous Materials Management
Ecological Impacts/Biodiversity
Customer Privacy
Product Design and Life-cycle Management
Management of Legal and Regulatory Environment
Business Ethics
Competitive Behaviour
Critical Incident and Risk Management
Appendix B.2 (continued) - Materiality (with People, Planet, Prosperity, Principles)
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Appendix B.3 - Enterprise Risk Management (ERM)
ERM principles and techniques are underpinned by:
• ISO 31000: Risk management – Principles and guidelines;
• ISO 31010: Risk management – Risk assessment techniques;
•
ISO 17776: Guidelines on tools and techniques for hazard identification and risk assessment;
• DNV RP-H101: DNV Recommended Practice – RISK management in marine operations
• Value creation uses the ERM process: identify, evaluate, control and mitigate the risk and
opportunities across DOF.
The ERM process
The ERM process involves the systematic application of policies,
procedures and practices to manage risk and opportunities,
establishing efficient barriers and controls across all phases of
the business life cycle by undertaking these activities:
1. Communication and consultation;
2. Scope, context and criteria;
3. Risk assessment;
4. Risk treatment;
5. Monitoring and review; and
6. Recording and reporting
Monitoring
and
review
Communication
and
consultation
Recording
and
reporting
Risk
assessment
Risk
treatment
Establishing
the context
Value creation uses the Enterprise Risk Management
(ERM) process: identify, evaluate, control and mitigate
the risk and opportunities across DOF.
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The ERM process
(continued)
Risk associated with DOF’s
strategic direction; framing
strategy; framing value
creation; 3-yr improvement
program.
Strategic Risk
Regional and Business
Unit Management Teams
Appendix B.3 (continued) - Enterprise Risk Management (ERM)
Perform audits against global
frameworks; communicate
concerns raised by audit
committees or stakeholders
relevant to business unit
actions.
Review material issues,
including: problematic
cultural and operational
risk and opportunities with
specific focus on delays,
cost overruns, commercial
disputes, margins, and
other concerns.
Cascading lessons learned
across DOF regions and
business units.
Oversee activities of the
external and internal audit
functions, receive input on
the adequacy of financial
reporting and control
mechanisms on material
risk issues that could
impact company integrity.
Risks associated with
operations, planning and
executing marine and
subsea activities.
Operational Risk
Risks associated with
corporate culture; adapting
global business model
to regional business en-
vironment and customs;
local legal issues; regional
management.
Business Risk
Board of Directors /
Corporate Management
BOD and Corporate levels
of the management:
To produce lasting value
for stakeholders, and a
long-term competitive
return on the investment
the BOD and Corporate
Management regularly
evaluate long-term risk and
opportunity and potential
impact on strategic deci-
sions taken today.
The Corporate Management team as the governing body for assurance of the ERM model
by overseeing activities and efficacy ERM Framework – reporting to the BOD
Engaging key stakeholders; evaluating value creation; setting risk appetite; consider
high-level organisational risk from other areas of the business; strategic risk management
and governance mechanisms to respond to mega-trends and long-term macro level shifts
in the external market; cascading governance principles into cultural and process risk
management areas.
Execution Teams
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The dashboard contains
results from key targets,
both financial and non-
financial, established in
DOF Subsea. Additional
targets & review of current
targets are ongoing.
Since 2014, we have
made substantial
progress in improving our
sustainability reporting.
Full details for both financial and non-financial
2021 performance are given in the financial
statements and in the ESG factbook.
DOF Subsea's value drivers
3.9
BILLION
Subsea project
total revenue in 2021
1.6
*
BILLION
time charter total revenue in 2021
* According to management reporting
85%
Utilisation
of the group fleet in 2021
80%
Utilisation
of Subsea project fleet in 2021
10.4
BILLION
group backlog per 31.12.2021
Financial performance
Applying relevant UN SDGs
The UN Sustainability Development Goals (SDGs)
are comprehensive in the issues that they address
with each goal having specific actions and targets.
As an organisation working principally with subsea
engineering and offshore vessels, DOF has assessed
the specific SDGs where we have the greatest impact
and can make a significant contribution as part of our
operations. We aligned eight SDGs (3, 4, 5, 8, 9, 13,
14, and 16) with corresponding material aspects. You
can see how they fit together on page 136.
Read more about UN SDGs:
https://sustainabledevelopment.un.org/
0
Fines
or non-monetary sanctions
due to non-compliance
36
Audits & Inspections
completed in 2021
172
NCRs
raised in 2021
0
Corruption
cases in 2021
Governance
Appendix B.3 - DOF Subsea's value driver results 2021
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4.2
Subsea client
satisfaction
in 2021
(out of max score of 5)
4.2
Marine client
satisfaction
in 2021
(out of max score of 5)
98.7%
Vessel uptime
available operative time in 2021
99.3%
ROV uptime
available operative time in 2021
Marine and Subsea service delivery
1
Lost time injuries
Lost Time Injuries (LTIs)
in 2021
7
Incidents
recordable incidents
in 2021
0.27
/million hrs
Lost Time Incident frequency
13,211
Safety observations
raised in 2021
1.90
/million hrs
recordable incident frequency
2,226
Obervations
positive safety observations
reported by workforce
Operational health & safety
-6.6%
CO
emissions
total emissions in 2021
compared to 2020
B
CDP score
for 2021
0
Unrecovered
no spills unrecovered over 50 litres
Environmental performance
0
GDPR breaches
recorded in 2021
1
Confirmed
harassment cases
recorded in 2021
0.79%
Absence
absence due to sickness in 2021
1,463
Headcount
headcount per 31.12.2021
People
Appendix B.3 - DOF Subsea's value driver results 2021
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Appendix B.4 - Figures & tables
HSEQ INPUTOUTPUTS GLOBAL TARGETS METRICS
Number of Lost Time Injuries 0
Lost Time Injury Frequency Rate (LTIFR) < 0.3 / 1 000 000 man-hours
Lost Recordable Case Frequency Rate (TRCF) Includes LTIs,
Restricted Workday Cases, Medical Treatment Cases and fatalities.
<1.1 / 1 000 000 man-hours
First Aid Cases < 7.5 / 1 000 000 man-hours
Safety Observation Rate 600 / 200 000 man-hours
Global HSE targets - Figure 8
Overview of emergency incidents and exercises - Figure 7
Incident 30 28 9
Exercise 28 36 41
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Appendix B.4 (continued) - Figures & tables
OHS INPUTS OUTPUTS UNIT OF MEASUREMENT
2021
Target 2021
Man-hours Number 8 784 602 7 558 323 9 104 679
High consequence injuries Number 1 2 0
High consequence injury rate
Injuries per million man-hour
0.11 0.26 0
Fatalities Number 0 0 0 0
Number of Lost Time
Incidents (LTI) Number 0 6 6 5
Lost Time Injury
Frequency Rate
LTIs per
million man-hour < 0.3 0.68 0.79 0.55
Total Recordable Cases Number 18 19 20
Total Recordable Case
Frequency Rate
TRC
per million man-hour < 1.1 2.05 2.51 2.2
First Aid Cases Number 55 57 53
First Aid Case
Frequency Rate
FACs per
million man-hour < 7.5 6.26 7.54 5.82
Safety Observation Rate
SOB per
200.000 man-hour > 600 711 656 598
Lost Day Rate
% lost days
of scheduled days 0.04% 0.03% 0.02%
Absentee rate
% absent days
of scheduled days 3.73% 3.28% 2.45%
Occupational Health and Safety Indicators - Figure 9
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Appendix B.4 (continued) - Figures & tables
Conversion factors - Figure 12
Total energy consumption within the organisation in joules (see below for conversion factors)
ENERGY CONSUMPTION UNIT
Nonrenewable fuel consumed (fuel oil and LNG, scope 1 vessels)
GJ 6 084 447 6 334 898 6 898 322
Renewable fuel consumed
GJ 0
Electricity, heating, cooling and steam purchased for consumption
GJ 27 828 35 655 25 279
Self-generated electricity, heating, cooling and steam
GJ 0
Electricity, heating, cooling and steam sold
GJ 0
Total energy consumption within the organisation
GJ 6 112 275 6 370 553 6 923 601
Energy consumption outside the organisation (non-renewable
fuel consumed (fuel oil, scope 3 vessels)
GJ 1 221 769 Not available Not available
ITEM SOURCE
Marine gas oil (MGO) DEFRA 2021
Electricity Norway
1) IEA (2021), Emission Factors
2) AIB (2021), European Residual Mixes 2020
3) %RE: IEA
Electricity Canada
1) IEA (2021), Emission Factors
2) 2021 Green-e Residual mix Emissions Rates (2019 data, approximation)
Electricity Brazil 1) IEA statistic 2020, emission factor for 2018
Electricity USA
1) IEA statistic 2021, emission factor for 2019
2) 2020 Green-e Residual Mix Emission Rates (2018 data)
Electricity UK
1) IEA (2021), Emission Factors
2) AIB (2021), European Residual Mixes 2020
3) %RE: IEA
Electricity Australia
1) IEA (2021), Emission Factors
2) No residual emission factor
3) %RE: IEA
Electricity Singapore
1) IEA (2021), Emission Factors
2) No residual emission factor
3) %RE: IEA
Residual waste, incinerated Ecoinvent 3.8
ELECTRICITY CONSUMPTION PER REGION UNIT
Australia * MWh 231.0 * 231.0 311.5
Brazil MWh 352.7 412.5 643.5
Canada MWh 133.2 149.0 149.4
Norway MWh 6 454.6 8 469.1 4 914.9
Singapore * MWh 82.1 * 82.1 104.0
UK MWh 144.5 179.5 281.5
USA MWh 332.0 381.0 617.0
Total MWh 7 730.1 9 904.2 7 021.9
Electricity consumption per country - Figure 11
Energy consumption - Figure 10
100 %
0 %
Non-renewable vessel fuel consumed
Electricity, heating, cooling and steam
purchased for consumption
Energy
consumption
* Estimate based on 2020
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Appendix B.4 (continued) - Figures & tables
Intensity reduction targets - Figure 14
* Operational day is defined as days with vessel in warm layup, idle in port/field or in operation.
The above table shows the verified emission per operational day for Scope 1 vessels from 2013-2021 (total tons CO2e Scope 1 / total operational
days Scope 1).
Note: the figure has been recalculated with the assumptions for the 2021 reporting, to provide comparability year by year. The historical figures for
2020 and earlier will consequently vary slightly from what has been reported in previous years.
YEAR EMISSION PER OPERATIONAL DAYS * % CHANGE
Verified 2021 23.9 2.1 %
Verified 2020 23.4 0.4 %
Verified 2019 23.3 -8.9 %
Verified 2018 25.5 -1.2 %
Verified 2017 25.9 -3.3 %
Verified 2016 26.7 -1.3 %
Verified 2015 27.1 2.9 %
Verified 2014 26.3 -1.0 %
Verified 2013 26.6
22
27
26
25
24
23
201520142013 20172016 2018 2019 2020
normalised emissions (C0
2
e)
CO
2
Emissions - Figure 13
Note: Prior to 2021, this table only showed Scopes 1 and
2, and Scope 2 was reported location-based. From 2021
going forward, Scope 2 will be reported market-based.
Note: Prior to 2021, this table only showed Scopes 1 and 2, and Scope 2 was reported location-based. From 2021 going forward, Scope 2 will
be reported market-based.
Methodology used: The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (Revised Edition).
Notes:
1) Although DOF started to report to the CDP in 2010 the base year chosen was 2011, since the data for 2010 was quite weak. Emissions in
base year (tons CO2e) was 593,745 (Scope 1) and 700 (Scope 2).
2) As vessel fuel consumption has an element of inaccuracy due to the methods in which fuel consumption are recorded onboard vessels, there is
a level of uncertainty associated with the final Scope 1 and Scope 3 emissions.
3) The chosen consolidation approach for emissions is Operational control.
4) GWP source: CO2 (IPCC Fourth Assessment Report (AR4 - 100 year).
5) CO2e (CO2 equivalent) includes all major greenhouse gases; carbon dioxide (CO2), methane (CH4), nitrous oxide (N20)
CO
EMISSIONS UNIT OF MEASURE
Scope 1 ton (CO2e) 436 671 462 683 481 649
Scope 2 ton (CO2e) 3068 719 927
Scope 3 ton (CO2e) 97 265 111 714 137 438
Total * ton (CO2e) 537 004 575 116 620 014
Change (total) % -6.6 % -7.2 %
Scope 1 81 %
Scope 2 1 %
Scope 3 18 %
0 %
Scope 1
Scope 2
CO
2
Emissions
100 %
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Appendix B.4 (continued) - Figures & tables
Supply Chain Management (SCM) - Figure 15
Contracts
CORE Supply Chain Disciplines
Support Disciplines
Preparation and management of contracts and
model templates for SCM in DOF’s best interests
Development and maintenance of integrated systems, processes,
controls, & reporting associated with the SCM system
Controls the efficient, and effective, movement,
and storage of equipment and goods.
Selection and management of vendors and suppliers
capable of servicing DOF’s requirements
Management of the purchase order
processes
Vendor
Management
Procurement
Management
Logistics
Management
SCM Business
Systems
General information regarding our Supply Chain Management is also given on page 164 under the Principles chapter.
DOF 3 - Revenue per segment (DOF Subsea) - Figure 16
Subsea projects
71 % 61 % 63 %
Chartering of vessels 29 % 39 % 37 %
Total revenue (NOK Million) 5 545 5 337 5 147
Distribution of projects per project level (DOF Subsea) - Figure 17
Level 0: Budget Pricing 3 %
Level 1: Manpower or Equipment Hire 16 %
Level 2: Working on Clients Vessel or PM&E Contracts 7 %
Level 3: Vessel Charters or Minor IMR Campaign 53 %
Level 4: Light Construction or IMR 19 %
Level 5: Major Construction/Intervention Projects 2 %
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Appendix B.4 (continued) - Figures & tables
Employment statistics as of 31.12.2021 - Figure 18
TOTAL MEN WOMEN ATLANTIC
ASIA
PACIFIC
NORTH
AMERICA
SOUTH
AMERICA
Permanent Contract (Full-time) 2719 2361 358 787 210 190 1532
Temporary Contract (Full-time) 79 73 6 56 11 4 8
Permanent Contract (Part-time)
23 9
14 19 4 0 0
Temporary Contract (Part-time) 73 46 27 10 0 0 63
Self-employed workers 926 847 79 338 255 58 275
Total
3820 3336
484 1210 480 252 1878
BY GENDER PERFORMANCE REVIEWS TOTAL HEADCOUNT % OF EMPLOYEES RECEIVED REVIEWS
Female 169 419 40.33 %
Male 1550 2550 60.78 %
Total 1719 2969 57.90 %
BY EMPLOYEE CATEGORY
PERFORMANCE REVIEWS TOTAL HEADCOUNT % OF EMPLOYEES RECEIVED REVIEWS
Senior managers 74 220 33.64 %
Managers 368 551 66.79 %
Staff 1277 2198 58.10 %
Total 1719 2969 57.90 %
Overview of performance reviews by gender and employee category - Figure 19
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Appendix B.4 (continued) - Figures & tables
Summary of pension schemes - Figure 20
ATLANTIC
Norway (DOF Management / DOF ASA)
• There are no longer defined benefit pension plans in DOF ASA or DOF Management.
• Employees have a defined contribution pension plan. A percentage of salary is paid to an insurance company
in line with the earnings of wages.
• All employees are part of the pension scheme.
• Pension fund is handled by the insurance company.
• The company has no liabilities or obligation after payments to the insurance company on behalf of the indi-
vidual employee.
• The individual employee’s fund is based on actual payment done by the company and actual returns on funds.
• The employee gets the value of the fund paid in monthly payments when the employee reaches the age of
pension.
Norway (DOF Subsea)
• DOF Subsea AS and DOF Subsea Norway AS have a defined contribution pension plan for employees. A
percentage of salary is paid to an insurance company in line with the earnings of wages. The companies
have no pension liability.
• All employees are part of the pension scheme.
• Pension fund is handled by the insurance company.
• The company has no liabilities or obligation after payments to the insurance company on behalf of the
individual employee.
• The individual employee’s fund is based on actual payment done by the company and actual returns on
funds.
• The employee gets the value of the fund paid in monthly payments when the employee reaches the age
of pension.
UK
• There is no liability for the company.
• In UK there are no defined benefit plans.
SOUTH AMERICA
Brazil
• There is no liability for the company.
• In Brazil the company holds a private pension plan on a private bank.
• Pension Plan is based on salary percentage contribution from both employee and the company. Department
manager and above positions may contribute with up to 7.5% while for other employees the limit will be 3%.
• Scheme is voluntary and it is estimated that 40% of all employees are participating in DOF Subsea Brazil
and 50% in Norskan.
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Appendix B.4 (continued) - Figures & tables
NORTH AMERICA
USA
• The plan is fully funded and DOF Subsea has no liability to the plan. The plan matches the first 6% of
contributions dollar for dollar; The company portion is immediately vested at 100% as soon as the money
is remitted to the plan manager each pay period. The 401(k) plan is a DC plan. Such plans in the USA don't
act like DB plans of old (aka pension plans). So there is no liability or estimates to cover obligations to the
plan. All 401(k) plans are fully vested under the safe harbor act.
• In 2021, employees under age 50 could contribute up to a maximum of $19,500, those 50 and over may
contribute up to $26,000. The company match is up to 6% of payroll per participant.
• Scheme is voluntary.
Canada
• There is no liability for the company.
• Employer/Employee funded RRSP through Manulife. Maximum employer contribution is 5% for employees
with 5+years of services or 4% for those with less than 5 years; employees have option to contribute based
on individual RRSP contribution maximums. Monthly contributions are remitted to Manulife by the 15th of
following month.
• Scheme is voluntary.
ASIAPACIFIC
Australia
• There is no liability for the company.
• Australia operates compulsory superannuation schemes based on employer defined contributions.
• Employees have the right to choose which superannuation fund (external funds they are a member of).
• External superannuation funds in Australia are monitored by Australian Securities and Investment Com-
mission as well as other Governmental agencies.
• i) 9.5% employer contribution on gross salary to cap of AUD 114,180 for 6-months to 30 June 2021,
ii) 10% employer contribution on gross salary to cap of AUD 117,840 for 6 months ended 31 Dec
2021. iii) Employee contributions from payroll are voluntary
Singapore
• There is no liability for the company.
• Monthly contributions to the Central Provident Fund on wages up to an income ceiling of SGD 6,000. Rates
for employees 55 and under:
• i) employer - 17%
• ii) employee - 20%
• For employees over 55, the rates reduce - the lowest level being of 7.5% (employer) and 5% (employee) for
ages 70 and over.
• The scheme is mandatory for Singapore citizens and permanent residents. Others are not eligible.
Philippines
• Social security contributions are required under several social institutions, the aggregated maximum
monthly amounts are:
• i) employer - PHP 3,125
• ii) employee - PHP 2,125
• The scheme is mandatory for all Philippine employees.
Indonesia
• In Indonesia, the company is required to pay monthly contributions to the Workers Social Security fund
based on fixed rates.
• The scheme is mandatory for all Indonesian employees
Summary of pension schemes - Figure 20 (continued)
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Appendix B.4 (continued) - Figures & tables
BRAZIL
• Life insurance (employee and spouse/husband)
• Funeral Insurance (employee and spouse/husband)
• Health and Dental Insurance (employee and direct dependents - spouse/wife and kids)
• Pension Plan (employee) company do a deposit of the same amount than employee
• Supermarket Coupon (monthly basis)
• Restaurant Coupon (monthly basis only for onshore employee)
AUSTRALIA
All employees, whether full-time or part-time / fixed term have the same benefits, though if part-time some
benefits are pro-rated e.g. leave accruals. With the exception of:
9 Day Fortnight (flexibility) Scheme for permanent onshore full-time employees only (or maximum duration >12
months) - Employee Assistance Program.
NORWAY
All employees, including temporary employees, are entitled the same benefits. Employees who are younger than
20 years old or work less than 20% are entitled to most of the benefits except::
• Life insurance
• Disability and invalidity coverage
• Paid parental leave
• Pension
SINGAPORE
All employees, whether full-time or part-time have the same benefits. If fixed term or casual, benefits reduce.
Different benefits may be offered to employees based on their Singapore residency status (e.g. health insurance,
flights) or a car park bay based on their role seniority.
PHILIPPINES
All employees, whether full-time or part-time /fixed term, have the same benefits with the exception of:
Service Incentive Leave entitlement after one year of service, an employee becomes entitled to a yearly service
is provided with incentive leave of 5 days with pay (there are preclusions so must check always as to who this
applies to, for example does not apply to Managers or those employed in establishments regularly employing
less than 10 employees). Leave can be used in ill health or for general holidays and the balance must be paid
out at the end of the year.
TOWP (Time Off With Pay) sick - days not used at the end of each calendar year will be converted into money
equivalent and paid to the employee. Not available to casual employees.
Benefits provided to full-time employees that are not provided to temporary or part-time employees - Figure 21
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Appendix B.4 (continued) - Figures & tables
US
Benefits provided to full-time employees that are not provided to temporary or part-time employees:
• Health and Dental Programs to include medical, dental, and vision
• Flexible Spending Accounts (FSA and HSA)
• Life Insurance – Company Paid
• Voluntary Life Insurance – Employee Paid
• Short term and long term disability
• Employee Assistance Program (EAP)
• Vacation
• Statutory Holidays
• Sick Leave
• Family Medical Leave (FMLA)
• Time off to Vote
• Jury/Witness Leave
• 401(k) retirement (6% company match currently)
CANADA
The benefits below are provided to full-time employees and not provided to temporary / casual employees.
Part-time employees may have some or all of the benefits based on hours worked.
• Life Insurance
• Critical Illness
• Short term and Long term disability
• Employee and Family Assistance Program (EAFP)
• Vacation - Statutory Holidays
• Registered Retirement Savings Program
• Family Violence Leave - Personal Leave
• Parental Leave
• Adoptive Leave
• Bereavement Leave
• Compassionate Leave
• Reserve Leave
• Sick Leave
• Time off to Vote
• Jury/Witness Leave Duty
Benefits provided to full-time employees that are not provided to temporary or part-time employees - Figure 21 (continued)
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Appendix B.4 (continued) - Figures & tables
Entities included in the organisation’s sustainability reporting - Figure 22
ENTITY OPERATION
REGION SIGNIFICANT AREA
OF OPERATION
DOF Management Australia Pty Asia Pacific
DOF Management Pte Asia Pacific
DOF Subsea Asia Pacific Pte. Ltd Asia Pacific
DOF Subsea Asia Pacific Pte. Ltd, Philippine Branch Asia Pacific
DOF Subsea Australia Pty Asia Pacific
PT DOF Subsea Indonesia Asia Pacific
DOF ASA Atlantic
DOF Management AS Atlantic
DOF Management Egypt Branch Atlantic
DOF Management UK Atlantic
DOF OSM Atlantic
DOF SJØ AS Atlantic
DOF Subsea Angola Lda Atlantic
DOF Subsea AS Atlantic
DOF Subsea Ghana Ltd Atlantic
DOF Subsea Norway AS Atlantic
DOF Subsea Norway Offshore AS Atlantic
DOF Subsea UK Ltd Atlantic
Marin IT AS Atlantic
DOF Subsea Canada Corp North America
DOF Subsea US Inc North America
DOF Management Argentina S.A. South America
DOF Subsea Brasil Servicos Ltda South America
Norskan Offshore Ltda South America
The below list shows the entities (operations) included in DOF’s sustainability reporting and
the region the entity is considered part of, in the context of significant area of operation.
The list below is determined based on entities with operational activity, and thus will dier
from the list of companies within the group in the consolidated financial statements.
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Appendix B.5 - Document figure overview
NUMBER DESCRIPTION PAGE
Figure 1 Employment type 139
Figure 2 Diversity of employees 139
Figure 3 Waste categorisation 144
Figure 4 DOF 1 - Operational uptime 153
Figure 5
DOF 2 - Customer Satisfaction
153
Figure 6
Degree of complexity / risk compared to degree of control required
159
Figure 7 Overview of emergency incidents and exercises 182
Figure 8 Global HSE targets 182
Figure 9 Occupational Health and Safety Indicators 183
Figure 10 Energy consumption 184
Figure 11 Electricity consumption per country 184
Figure 12 Conversion factors 184
Figure 13 CO2 Emissions 185
Figure 14 Intensity reduction targets 185
Figure 15 Supply Chain Management 186
Figure 16 DOF 3 - Revenue per segment (DOF Subsea) 186
Figure 17
Distribution of projects per project level (DOF Subsea)
186
Figure 18 Employment statistics as of 31.12.2021 187
Figure 19 Overview of performance reviews by gender and employee category 187
Figure 20 Summary of pension schemes 188
Figure 21
Benefits provided to full-time employees that are not provided to temporary or
part-time employees
190
Figure 22 Entities included in the organisation's sustainability reporting 192
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A member firm of Ernst & Young Global Limited
State Authorised Public Accountants
Ernst & Young AS
Dronning Eufemias gate 6, NO-0191 Oslo
Oslo Atrium, P.O.Box 20, NO-0051 Oslo
Business Register; NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Member of the Norwegian Institute of Public
Accountants
To the Board of Directors of DOF ASA
Independent accountant’s assurance report
Scope
We have been engaged by DOF ASA to perform a limited assurance engagement, as defined by
International Standards on Assurance Engagements, here after referred to as the engagement, to
report on DOF ASA’s sustainability reporting as the DOF ASA have defined and referred to in the
DOF ASA’s GRI Index (the “Subject Matter”) as of 31 December 2021 for the period from 01
January 2021 to 31 December 2021.
Other than as described in the preceding paragraph, which sets out the scope of our engagement,
we did not perform assurance procedures on the remaining information included in the sustainability
reporting, and accordingly, we do not express a conclusion on this information.
Criteria applied by DOF ASA
In preparing the Subject Matter, DOF ASA applied the relevant criteria from the Global Reporting
Initiative (GRI) sustainability reporting standards, “Core” option (the “Criteria”) and the Greenhouse
Gas (GHG) Protocol Corporate Accounting and Reporting Standard. The Criteria can be accessed
at globalreporting.org and are available to the public. Such Criteria were specifically designed for
companies and other organizations that want to report their sustainability impacts in a consistent
and credible way. As a result, the Subject Matter information may not be suitable for another
purpose. We consider these reporting criteria to be relevant and appropriate to review the
sustainability reporting.
DOF ASA’s responsibilities
The Board of Directors and Chief Executive Officer (management) are responsible for the selecting
the Criteria, and for presenting the Subject Matter in accordance with that Criteria, in all material
respects. This responsibility includes establishing and maintaining internal controls, maintaining
adequate records and making estimates that are relevant to the preparation of the Subject Matter,
such that it is free from material misstatement, whether due to fraud or error.
EY’s responsibilities
Our responsibility is to express a conclusion on the presentation of the Subject Matter based on the
evidence we have obtained.
We conducted our engagement in accordance with the International Standard for Assurance
Engagements Other Than Audits or Reviews of Historical Financial Information (‘ISAE 3000’). This
standard requires that we plan and perform our engagement to obtain limited assurance about
whether, in all material respects, the Subject Matter is presented in accordance with the Criteria,
and to issue a report. The nature, timing, and extent of the procedures selected depend on our
judgment, including an assessment of the risk of material misstatement, whether due to fraud or
error.
We believe that the evidence obtained is sufficient and appropriate to provide a basis for our limited
assurance conclusions.
Penneo Dokumentnøkkel: BUKLL-2N043-ITWFE-XHGNT-QCUX3-E1Y5E
Appendix B.6 - Independent Assurance Report - EY
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Independent accountant’s assurance report - DOF ASA
A member firm of Ernst & Young Global Limited
State Authorised Public Accountants
Ernst & Young AS
Dronning Eufemias gate 6, NO-0191 Oslo
Oslo Atrium, P.O.Box 20, NO-0051 Oslo
Business Register; NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Member of the Norwegian Institute of Public
Accountants
Our Independence and Quality Control
We have maintained our independence and confirm that we have met the requirements of the Code
of Ethics for Professional Accountants issued by the International Ethics Standards Board for
Accountants. EY also applies International Standard on Quality Control 1, Quality Control for Firms
that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related
Services Engagements, and accordingly maintains a comprehensive system of quality control
including documented policies and procedures regarding compliance with ethical requirements,
professional standards and applicable legal and regulatory requirements.
Description of procedures performed
Procedures performed in a limited assurance engagement vary in nature and timing from, and are
less in extent than for, a reasonable assurance engagement. Consequently, the level of assurance
obtained in a limited assurance engagement is substantially lower than the assurance that would
have been obtained had a reasonable assurance engagement been performed. Our procedures
were designed to obtain a limited level of assurance on which to base our conclusion and do not
provide all the evidence that would be required to provide a reasonable level of assurance.
Although we considered the effectiveness of management’s internal controls when determining the
nature and extent of our procedures, our assurance engagement was not designed to provide
assurance on internal controls. Our procedures did not include testing controls or performing
procedures relating to checking aggregation or calculation of data within IT systems.
A limited assurance engagement consists of making enquiries, primarily of persons responsible for
preparing the Subject Matter and related information and applying analytical and other appropriate
procedures.
Our procedures included:
► Review of DOF ASA’s process for preparation and presentation of the sustainability report to
develop an understanding of how the reporting is conducted within the business
► Interviewed those in charge of sustainability reporting to develop an understanding of the
process for the preparation of the sustainability reporting
► Verified on a sample basis the information in the sustainability reporting against source data
and other information prepared those in charge
► Assessed the overall presentation of sustainability reporting against the criteria in the GRI
Standards including a review of the consistency of information against the GRI index.
We believe that our procedures provide us with an adequate basis for our conclusion. We also
performed such other procedures as we considered necessary in the circumstances.
Penneo Dokumentnøkkel: BUKLL-2N043-ITWFE-XHGNT-QCUX3-E1Y5E
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Independent accountant’s assurance report - DOF ASA
A member firm of Ernst & Young Global Limited
State Authorised Public Accountants
Ernst & Young AS
Dronning Eufemias gate 6, NO-0191 Oslo
Oslo Atrium, P.O.Box 20, NO-0051 Oslo
Business Register; NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Member of the Norwegian Institute of Public
Accountants
Conclusion
Based on our procedures and the evidence obtained, we are not aware of any material
modifications that should be made to the Subject Matter as of 31 December 2021 and for the period
from 1 January 2021 to 31 December 2021 in order for it to be in accordance with the Criteria.
Oslo, 06 April 2022
E
RNST &YOUNG AS
The assurance report is signed electronically
Eirik Moe
State Authorised Public Accountant
Penneo Dokumentnøkkel: BUKLL-2N043-ITWFE-XHGNT-QCUX3-E1Y5E
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Glossary
AUV: Autonomous Underwater Vehicle
CAPEX: Capital Expenditure
CDP Carbon Disclosure Project
CSV/Subsea Construction Support Vessels and Subsea vessels
DNV-GL: Det Norske Veritas. Classification company. Controlling and
approving the vessels technical condition, security and quality
according to the company’s own rules and the national laws
DP: Dynamic Positioning
E&P: Exploration & Production
EPIC: Engineering, Procurement, Installation & Commissioning
ERM Emergency Risk Management
ESG Environmental, Social, and Corporate Governance
FPSO: Floating Production Storage and Offloading
GHG: Greenhouse Gasses
GOM: Gulf of Mexico
GRI: Global Reporting Initiative
HR: Human Resources
HSEQ: Health, Safety, Environment and Quality
IFRS: International Financial Reporting Standards
IMCA: International Marine Contractors Association
IMO: International Maritime Organisation
IMR: Inspection, Maintenance, and Repair
IOC: International Offshore Company
ISM: International Safety Management Code
ISO: International Standards Organisation
ISPS: International Ship and Port Facility Security Code. International
framework to detect/ assess security threats and take preventive
measures against security incidents affecting ships or port
facilities used in international trade
LNG: Liquefied Natural Gas
MLC: Maritime Labour Convention
NIBOR: Norwegian Interbank Offered Rate
NIS: Norwegian International Ship Register
NOR: Norwegian Ordinary Ship Register
OHSAS: Occupational Health & Safety Advisory Services
OSCV: Offshore Subsea Construction Vessel
PLSV: Pipelaying Support Vessel
ROV: Remote Operated Vehicle
SDGs: United Nations Sustainable Development Goals
SEMS: Safety and Environmental Management Systems
STCW: Standards of Training, Certification and Watch keeping
SURF: Subsea, Umbilicals, Risers & Flowlines
T&I: Transportation & Installation
Time Charter Party (TC):
Contract for Chartering a Vessel
UDW: Ultra Deep Water
VAE: Value Adjusted Equity
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A dedication & thank you:
Thank you to all our hard working
and dedicated colleagues.
It is you that makes DOF
the preferred OSV manager and
subsea services partner.
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N
DOF Subsea AS
Thormøhlensgate 53 C
5006 Bergen
NORWAY
Phone: +47 55 25 22 00
DOF Subsea Norway AS
Thormøhlensgate 53 C
5006 Bergen
NORWAY
Phone: +47 55 25 22 00
A
DOF Subsea Angola
Belas Business Park-Talatona
Edificio Bengo, 1º Andar
Sala 106/107, Luanda
REPUBLIC OF ANGOLA
Phone: +244 222 43 28 58
Fax: +244 222 44 40 68
Mobile: +244 227 28 00 96
+244 277 28 00 95
A
DOF Subsea Australia Pty Ltd
5th Floor, 181 St. Georges Tce
Perth WA 6000
AUSTRALIA
Phone +61 8 9278 8700
Fax: +61 8 9278 8799
B
DOF Subsea Brasil Serviços Ltda
Rua Fiscal Juca, 330
Q: W2 – L: 0001
Loteamento Novo Cavaleiros
Vale Encantado – Macaé/RJ
BRAZIL - CEP 27933-450
Phone: +55 22 21 23 01 00
Fax: +55 22 21 23 01 99
C
DOF Subsea Canada
26 Allston Street
Mount Pearl, Newfoundland
CANADA, A1N 0A4
Phone: +1 709 576 2033
Fax: +1 709 576 2500
DOF Subsea AS
Thormøhlensgate 53 C
5006 Bergen
NORWAY
Phone: +47 55252200
S
DOF Subsea Asia-Pacific Pte Ltd
150 Beach Road
#14-01/03 Gateway West
189720
SINGAPORE
Phone: +65 6561 2780
UK
DOF Subsea UK Ltd
Horizons House
81-83 Waterloo Quay
Aberdeen, AB11 5DE
UNITED KINGDOM
Phone: +44 1224 614 000
Fax: +44 1224 614 001
USA
DOF Subsea USA Inc
5365 W. Sam Houston Parkway N
Suite 400
Houston, Texas
77041
USA
Phone: +1 713 896 2500
Fax: +1 713 726 5800
Cover image
Skandi Skansen in the north of
Norway.
Production team
The DOF Subsea Integrated
Annual Report 2021 is produced
with great care and would not be
possible without the contribution
of many of the DOF team across
the globe. We thank everyone for
their considerable eorts. Special
thanks go to the project team
who helped make this year's
report come together. Committed
to continuous improvement, we
welcome and appreciate your
feedback. If you would like to send
us your views, please contact:
stig.clementsen@dof.com
Layout
DOF ASA Corporate Communication
Department and Cogency Design
Solutions
Contact
Martin Lundberg
Chief Financial Ocer
DOF Subsea AS
martin.lundberg@dofsubsea.com
Distribution
The report is distributed digitally
via the DOF Subsea website, as
well as in printed format from
May 2022, is delivered to key
stakeholders and presented in
all DOF Subsea oces around
the globe.
www.dofsubsea.com
Document: DOF Subsea Integrated Annual Report 2021, Version: 1.00