As earlier communicated to the market, Prosafe will start to apply USD as reporting currency for its consolidated financial reports with effect from 1 January 2004. The background for changing reporting currency is that the group's material assets are valued and financed in USD, and that the group's operating profit mainly is denominated in USD.
The Prosafe group is organised in a parent company owning three business units; Floating Production, Offshore Support Services and Drilling Services. Only Floating Production prepares its accounts in USD, whereas the other business units and the parent company prepare their accounts in NOK.
Offshore Support Services owns and operates the group's accommodation/service rigs. The rigs are financed in USD and the business unit generates its operating revenues mainly in USD. Operating expenses within Offshore Support Services are mainly denominated in GBP and NOK.
Floating Production owns and operates the group's floating production and storage vessels. The vessels solely generate operating revenues in USD, and the operating expenses are denominated in USD and SGD.
Operating revenues and expenses within Drilling Services are largely NOK denominated.
The following principles have been applied when converting to USD reporting:
date exchange rates, with the exception of the
accommodation/service rigs and goodwill, which are
translated at historic exchange rates.
USD/NOK exchange rate with the following
exceptions:
- Depreciation of accommodation/service rigs
and goodwill amortisation are based on
historic exchange rates, i.e. the exchange rate
prevailing at the acquisition date for each
individual asset.
- Currency gain or loss in NOK accounts which
is caused by USD/NOK exchange rate
movements is reversed.
Attached are comparison figures for reporting in 2004. Figures for the full years 2003 and 2002 are shown consolidated and per business unit. For 2003, also figures per quarter are included.
Prosafe's auditors, Ernst & Young, have reviewed and agreed to the principles which have been applied to the conversion to USD reporting. The figures have, however, not been subject to a full audit.
Prosafe reports its Q1 2004 result on 4 May.
