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Dato/tid 19.04.2017 09:15
Utsteder Siem Offshore Inc.
UtstederID SIOFF
Instrument SIOFF
Marked OB
Kategori ANNEN INFORMASJONSPLIKTIG REGULATORISK INFORMASJON
Informasjonspliktig   Informasjonspliktige opplysninger   Lagringspliktig melding
Vedlegg
Tittel Change to financial statements for 2016 subsequent to previous issuance of 4Q press release
Tekst
Siem Offshore Inc. (the Company) reports that, pursuant to IAS 39 , 
the Company has recorded a loss of approximately USD60.3 million in 
relation to prior years' currency losses in a cash flow hedge that 
had accumulated in other comprehensive income in the financial 
statements of its wholly-owned Brazilian subsidiary, Siem Offshore 
do Brazil (Siem Brazil). This loss is recorded subsequent to the 
release of the preliminary results for fiscal 2016 on 23 February 
2017.

In past years, Siem Brazil successfully bid on term contracts from 
Petrobras for new vessels which it built in Brazil and financed 
using USD-denominated debt. Because Siem Brazil's financial 
statements were prepared using Brazilian reals (R$) as the 
functional currency, its income statement reflected significant 
fluctuations in currency exchange gains and losses when accounting 
for the USD-denominated debt. To reduce the fluctuations, Siem 
Brazil established a cash flow hedging strategy under which USD-
denominated revenues from specific vessels and related contracts 
were matched against the USD-denominated debt. As long as the 
revenue cash flows were highly probable and in USD and were 
sufficient to cover the debt service for the USD-denominated debt, 
then the resulting gains or losses on the USD debt were recorded and 
accumulated as other comprehensive income in shareholders' equity 
rather than recorded in profit or loss.

During the past several years, Brazil in general and Petrobras in 
particular experienced significant financial stress. The Brazilian 
real fell during 2015 from approximately R$2.6 to the USD to R$4 to 
the USD, or a devaluation of approximately 50%. Furthermore, 
Petrobras either terminated or did not exercise its option to extend 
contracts for a number of vessels, including several vessels that 
had been identified in Siem Brazil's cash flow hedging strategy. The 
sharp devaluation of the R$ and the significant increase in the 
amount of R$ that was equivalent to the USD-denominated debt 
increased the balance in other comprehensive income. 

After considering recently received information relevant to the 
ability of Siem Brazil to reverse the balance of accumulated 
translation differences in other comprehensive income, it was 
concluded that the recent termination of vessel contracts and loss 
of highly-probable USD cash flows and the continued devaluation of 
the Brazilian real made it unlikely that the accumulated balance 
would naturally reverse during operations. Therefore, USD60.3 
million related to the accumulated translation differences in other 
comprehensive income is recognized through profit or loss. 
Consequently, other comprehensive income is increased by the removal 
of the USD60.3 million and retained earnings is decreased by the 
same amount of USD60.3 million that is recorded in profit and loss; 
therefore, shareholders' equity remains unchanged and there is no 
cash effect. See the effects of the changes due to the recording of 
the loss below.

Preliminary results as presented before adjustment for Loss (in 
000's):
USD(82,117)  Net loss attributable to shareholders
USD  (0.10)  Loss per share

Results subsequent to the adjustment for Loss (in 000's):
USD(142,417)  Net loss attributable to shareholders
USD   (0.17)  Loss per share

Shareholders' equity both before and after adjustment for Loss (in 
000's):
USD549,107  Unchanged


For further information, please contact:
Dagfinn B. Lie - CFO
+47 901 99 051


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