FAQ

CBO Holding S.A., together with its subsidiaries (collectively, “Grupo CBO”) is one of the pioneers in Brazil in the offshore support market for the offshore oil and natural gas exploration and production (“E&P”) industry, with over 45 years of history.

The Company operates through its fleet of vessels, with its own crew that support the offshore oil and gas E&P chain in an essential way. Currently, we are the second-largest offshore support company in the country, with a fleet of 45 vessels equipped with appropriate technology and prepared for a high degree of complex operations in deep waters.

CBO provides maritime support solutions for offshore operations, offering medium and large vessels of different types to address customer demands according to specific needs.

Currently, CBO has a fleet consisting of 45 vessels (23 PSV, 13 AHTS, 6 RSV and 3 OSRV):

• • • • • • • • • • • PSV – Plataform Supply Vessel: vessels for logistics support, designed to transport supply drilling & production bulks, fluids, potable and drill water, fuel oil, pipes, backload and other equipment to and from offshore units.
                    • AHTS – Anchor Handling Tug Supply: Designed for anchor handling and towing offshore platforms, barges, production units and other vessels, support shuttle tankers in offload operation as well as supply duties.
                    • RSV – ROV Supply Vessel: Inspection, Maintenance and Repair (IMR) vessels, designed for launching and operate a Remote Operated Vehicle and for support several subsea activities.
                    • OSRV – Oil Spill Response Vessel: vessels for environmental support, designed to attend the field emergency plan for oil spill, performing oil recovery activities with oil boom and skimmer besides firefighting.

In 2021, CBO also announced a new line of business in the Integrated Logistics segment. This business complements vessel chartering by offering the management and operation of the entire supply chain for maritime units, including offshore integrated logistics (at sea), onshore warehousing (on land), and land transportation of cargo and supplies.

CBO was the first company in the sector to sign an integrated logistics contract for the Offshore market in Brazil, reinforcing our pioneering DNA.

The offshore support market in Brazil is highly dynamic and promising, due to Brazil being one of the top 10 oil-producing countries in the world, with extraction predominantly occurring in deep waters. In 2023, 97.6% of all oil production in the country was from offshore wells, and according to data from the National Confederation of Industry (Confederação Nacional da Indústria (CNI) in portuguese), oil and natural gas extraction represents over 10% of Brazil’s GDP and approximately 38% of the state of Rio de Janeiro’s GDP.

Additionally, the offshore support sector in Brazil has a regulatory framework designed to develop the domestic market. It’s important to mention the preferential rights to contract Brazilian vessels, a rule established by Law 9.432/97 that aims to encourage Brazilian shipowners to fly the Brazilian flag on their vessels. This mechanism allows for the blocking of a foreign vessel if a similar Brazilian vessel is available, an ideal scenario for a company like CBO, which has a fleet of 32 national vessels.

It is also worth mentioning the existence of an investment fund dedicated to the sector, the Merchant Marine Fund (Fundo da Marinha Mercante (FMM) in portuguese), which provides long-term credit with below-market interest rates, enabling the development of offshore support companies in Brazil. Furthermore, although the Brazilian O&G market is subject to volatilities, such as changes in oil barrel prices and dollar exchange rate fluctuations, Grupo CBO is able to maintain its financial health through long-term contracts negotiated in dollars and an efficient management model capable of anticipating potential impacts on the supply chain.

According to the Brazilian Association of Offshore Support Companies (Associação Brasileira das Empresas de Apoio Marítimo (“ABEAM”) in portuguese), in September, 2024, CBO has the second-largest fleet of offshore support vessels in Brazil, with a 16% market share, considering only the classes that CBO operates. Additionally, according to VesselsValue (an online platform for maritime market data and intelligence), CBO is in the global top 10 considering the number of vessels.

In 2024, CBO’s fleet has an average age of 12 years (versus a market average age of 16 years).

CBO is prepared to operate with flexibility, efficiency, and safety throughout Brazil. Currently, we have ongoing operations in the Santos, Campos and Espírito Santo.

The administrative headquarters and operational base are located in Niterói (RJ), and we also have a support base in Macaé (RJ), near the main ports of northern Rio de Janeiro.

CBO is a pioneering company in the offshore support sector, with a solid track record of innovation and several competitive advantages that set it apart from the rest of the market.

• Operational Excellence:
  • • • • • • • • • • Proven +45-year experience;
                    • High spec fleet with a lower average age compared to the market;
                    • Best downtime rate in the market;
                    • Operational Excellence Center (“CEOP”) for safety and process assurance, enhancing fleet operability levels, and ensuring our team continuous training, qualification, and development;
                    • Its own excellence program called “Fita Azul“.
• Solid Financial Structure:
  • • • • • • • • • • USD-Denominated company;
                    • Economies of scale (2^nd largest company of the Brazilian market);
                    • Lowest debt average cost in the market.
• High Governance Standards:
  • • • • • • • • • • Company complying with CVM requirements since 2015;
                    • Sustainability Report’s annual release since 2021;
                    • Board of Directors with two independent members;
                    • Independent Ethics Channel;
                    • Pro Ethics Seal company (“Selo Pró-Ética”).
• Social Vision:
  • • • • • • • • • • GPTW Company for 6 consecutive years;
                    • “For All” Committee: Effective Diversity and Inclusion programs to PWDs, Women, Black people, and LGBTQIA+;
                    • Pescar Project: young talents training’s program.

The Center of Operational Excellence (Centro de Excelência Operacional (CEOP) in Portuguese) is a key component to the Company’s operational success, with a crucial role in minimizing downtime, allowing proactive interventions and instant analysis to prevent or resolve operational issues.

Working 365 days a year, it monitors our operations and provides technical assistance for all CBO’s vessels. The direct and immediate access to crucial data, such as the current vessels position and meteorological and oceanographic forecasts, combined with the ability to observe the gangways and main decks activities, give us the possibility to intervene proactively, both in preventive and corrective measures.

Furthermore, the center offers customized training for crew members, with high-fidelity PSV and AHTS simulators and laboratory equipped with real machinery that prepare them to face complex operational scenarios.

The Company has relationships with major oil and natural gas exploration companies, with main clients including Petrobras, Equinor, Brava Energia, TotalEnergies, Saipem, Prio, Subsea7, Vibra, Karoon, Shell, Bunker One, Tranship, among others.

The charter contracts are based on day rates, with revenue being measured by vessel availability.

CBO’s contracts are typically long-term, lasting 2 to 3 years. However, we also have medium-term charter contracts, ranging from 30 to 180 days, and short-term contracts, known as “spot” contracts, lasting up to 30 days. These contracts are used to provide maritime support services to clients with specific short-term campaigns.

The vessel’s unavailability during the contract’s operational period, whether due to emergency maintenance, delays, or other issues, is referred to as downtime.

The period in which the vessel is unavailable is deducted from the contracted daily rate.

CBO has one of the best performances in the market, with high levels of operational excellence and with the lowest downtime rates in the market: in 9M24, we recorded an uptime of 96.7%.

The average fleet occupancy rate represents the days of operational contract time divided by the total available days in the period, considering all vessels in the fleet.

It is important to note that the occupancy rate does not consider downtime, accounting only the active contracts’ operational time during the period (contract time is the sum of uptime and downtime.

It is a contract for the use of a ship for a specified period. The shipowner provides the vessel without a captain, crew, or other items necessary for navigation. The bareboat charterer outfits and has total control of the ship, assuming as operating owner.

In the case of a vessel with a foreign flag, the charterer can use its tonnage to register the chartered vessel under the REB flag, suspending the original flag.

Created by Law 3.381/58, the Merchant Marine Fund (Fundo da Marinha Mercante (FMM) in Portuguese) is designated to promote the renewal, expansion, and replacement of the Brazilian merchant fleet, and to support the development of the naval industry in the country. FMM’s resources come from fees charged in the customs clearance process, money budgeted by the General Budget of the Union, and interest, commissions, and other revenues resulting from the investment of the fund’s resources.

The Regulatory Framework of 1997 (“Law 9.432/1997”) directly impacts competition in the Brazilian offshore support market, benefiting local players and making it harder for new foreign competitors to enter. Under this framework, Brazilian Shipping Companies (EBNs) were granted preference in operating chartered vessels in Brazil, and Brazilian-flagged vessels were given priority in contracting over foreign-flagged vessels (if both have similar technical specifications).

The framework also stipulates that vessels built in Brazil are eligible for financing through the Merchant Marine Fund, which offers lower interest rates and a longer amortization schedule—another key factor that provides significant advantages to Brazilian vessels.

If a company wishes to import vessels built in other countries, the framework allows those vessels to be repatriated through the Brazilian Special Registry (REB), making them equal in rights and obligations to originally Brazilian vessels. However, eligibility for REB registration is limited, depending on the tonnage of Brazilian vessels already owned by the company.

Tonnage refers to the cargo capacity a vessel can transport. This data is relevant for ANTAQ (National Agency for Waterway Transportation) to analyze the eligibility of registering foreign vessels in the REB (Brazilian Special Registry), considering the amount of tonnage of Brazilian vessels already owned by the company.

For clarification purposes, the REB uses a 57% ratio for this calculation: for example, if a company has a total national tonnage of 10,000 tons, it can register a foreign vessel in the REB with a capacity of up to 5,700 tons. Therefore, the larger the volume of tonnage in Brazilian vessels, the higher the registration limit in the REB.

The Brazilian Special Registry (REB) is an incentive for the Brazilian shipbuilding industry, established by Law No. 9.432/1997 (the Regulatory Framework of 1997). Every vessel carries the flag of its country, and the REB allows a foreign vessel to be repatriated and operate as a national vessel after approval by the Maritime Court.

The registration of a foreign vessel in the REB, with its original flag temporarily suspended, allows the vessel to fly the Brazilian flag and, consequently, be treated equally in all rights and obligations as a vessel originally from Brazil. This incentive requires periodic renewal for it to remain applicable.

Registering a vessel in the REB offers benefits for its owner, such as:

• • • • • • • • • • • The possibility for Brazilian Shipping Companies to contract, in the international market, insurance and reinsurance coverage for hulls, machinery, and liabilities for their vessels registered in the REB;
                    • The possibility for the crew of vessels registered in the REB to have only the captain and chief engineer necessarily be Brazilian;
                    • The equal treatment of construction, maintenance, modernization, and repair of vessels registered in the REB, for all legal and tax purposes, as an export operation; and
                    • Exemption for vessels registered in the REB from the obligation to pay the fee for the maintenance of the Maritime Professional Education Development Fund.

CBO adopts the U.S. dollar (US$) as its functional currency since 2019, since the currency most accurately represents the economic environment in which CBO operates. The functional currency is an accounting concept that states that an entity should adopt, for accounting purposes, the currency that best reflects its principal economic environment.

CBO’s contracts are typically broken down into two parts: one in Brazilian real (usually the smaller portion), and one in U.S. dollars (usually the larger portion). The Brazilian real portion of the contract revenue is calculated to offset all costs and expenses in reais, so that the Company’s margin, and therefore its result, is dollarized.

It corresponds to the money the company receives for its services, calculated as total gross revenue minus direct and indirect associated costs.

EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) corresponds to net income before tax/social contribution, depreciation and amortization expenses and the financial result. It represents the main non-accounting metric for monitoring the company’s financial performance, serving as an indicator used to measure how much a company generates in resources from its operation alone.

The Company also uses Adjusted EBITDA, which is calculated as EBITDA but excluding: (i) non-cash items (as the effect of provisions/reversals for assets’ impairment and the amortization of charter agreements); and (ii) expenses management considers as non-recurring and/or not linked to the Company’s key operations (results from the sale of fixed assets, expenses under purchase and sale agreements, and other non-recurring events in the Company’s operations).

The backlog represents all signed contracts with amounts to be received in the future — in other words, it is the company’s contracted gross revenue.

It is a very important indicator that provides greater stability in the business model: since CBO’s contracts are typically long-term, there is an increased predictability of future cash flow.

CBO’s debt has decreasing values concentrated in the long term (the company’s financing contracts have final maturity in 2038), with a cost that the company believes to be competitive (at the end of Q3 2024, the average debt cost was 5.8%), primarily due to 75% of its funding being from the Merchant Marine Fund (“FMM”).

All material facts, earnings releases, annual and quarterly financial statements, presentations, and other market communications from CBO are disclosed simultaneously on the CVM/B3 and on the company’s Investor Relations website (click here to access).

To access the company’s financial results and read our Earnings Releases, click here. To receive CBO updates via email, subscribe to our mailing list (click here).

The contact information for CBO’s Investor Relations department can be found at this link.

KPMG Auditores Independentes Ltda.

Rua do Passeio, nº 38, 17º andar Centro, Rio de Janeiro/RJ, ZIP CODE 20021-280; (21) 2207-9400

https://kpmg.com/br/pt/home.html

Banco BTG Pactual S/A

Praia de Botafogo, nº 501, 5º e 6º andar, Botafogo, Rio de Janeiro/RJ, ZIP CODE 22250-911; (21) 3262-9600

www.btgpactualdigital.com

Although CBO is registered as an “Category A” Company in CVM and follows all applicable requirements, CBO is not yet listed on the Stock Exchange and does not have shares in circulation.