2020 Bulkers Ltd. Nordnet Webcast Presentation 2 July, 2020 | - - PowerPoint PPT Presentation

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2020 Bulkers Ltd. Nordnet Webcast Presentation 2 July, 2020 | - - PowerPoint PPT Presentation

2020 Bulkers Ltd. Nordnet Webcast Presentation 2 July, 2020 | Disclaimer This presentation (the " Presentation ") has been prepared by 2020 Bulkers Ltd. (the " Company ") and is made 2 July, 2020 solely for information


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2020 Bulkers Ltd.

Nordnet Webcast Presentation 2 July, 2020

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Disclaimer

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This presentation (the "Presentation") has been prepared by 2020 Bulkers Ltd. (the "Company") and is made 2 July, 2020 solely for information purposes. The Presentation does not constitute any recommendation to buy, sell or otherwise transact with any securities issued by the Company. No representation, warranty or undertaking, express or implied, is made by the Company and no reliance should be placed on the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. The Company shall have no responsibility or liability whatsoever (for negligence or otherwise) for any loss arising from the use by any person or entity of the information set forth in the Presentation. All information set forth in the Presentation may change materially and without

  • notice. In making the Presentation public the Company undertakes no obligation to provide additional information or to make updates thereto. The information set forth in the

Presentation should be considered in the context of the circumstances prevailing at the date hereof and has not been and will not be updated to reflect material developments which may occur after such date unless specifically stated in such update(s). Matters discussed in the Presentation include "forward looking statements". "Forward looking statements" are statements that are not historical facts and are usually identified by words such as "believes", "expects", "anticipates", "intends", "estimates", "will", "may", "continues", "should" etc. These "forward looking statements" reflect the Company's beliefs, intentions and current expectations concerning, among other things, the Company's results, financial condition, liquidity position, prospects, growth and strategies. "Forward looking statements" include statements regarding: objectives, goals, strategies, outlook and growth prospects, future plans, events or performance and potential for future growth, liquidity, capital resources and capital expenditures, economic outlook and industry trends, developments in the Company's market, the impact of regulatory initiatives and the strength of the Company's competitors. "Forward looking statements" involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The "forward looking statements" included herein are based upon various assumptions, many of which, in turn, are based upon further assumptions. This includes, without limitation, the Company's review of historical operating trends, data contained in the Company's records and data available from third parties. Although the Company believes that these assumptions were reasonable when the relevant statements were made, they are inherently subject to significant known and unknown risks, uncertainties, contingencies and other factors which are difficult or impossible to predict and which are beyond the Company's control. "Forward looking statements" are not guarantees of future performance and such risks, uncertainties, contingencies and other important factors which are inherent thereto could cause the actual results of operation, financial condition and liquidity position of the Company or the industry in which it operates to differ materially from those results which, expressed or implied, are contained herein. No representation to the effect that at any of the "forward looking statements" or forecasts will come to pass or that any forecasted result will be achieved are made. The Presentation and the information contained herein does not constitute or form a part of and should not be construed as an offer for sale or subscription or of solicitation or invitation of any offer to subscribe for or purchase any securities issued by the Company.

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Attractive financing / moderate leverage => low cash breakeven The right assets - 8 Scrubber fitted Newcastlemax with proven premium vs Capesize Free cash flow to be paid as monthly dividends Stop investing as asset values and risk increases

Our business model

Invest at attractive entry point

Low cost corporate structure Full alignment of interest as founders & management are largest shareholders

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Unique fleet of 8 scrubber fitted Newcastlemax

High Performing assets with proven earnings premium All our ships are now delivered and are on contract to strong customers

1) Baltic 5TC index vessel

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Larger cargo intake vs. standard Capesize1) 15% Lower fuel consumption than standard Capesize1) 20% Fuel saving vs. non-scrubber fitted Newcastlemax2) 35% + +

Ship name Delivery Charterer Rate Charter expiry

Bulk Sandefjord Aug 19 Koch 14 378 + scrubber benefit until Dec 20. Index linked + scrubber benefit thereafter Aug 22 Bulk Santiago Sep 19 Koch 19 525 until Dec 20, index linked + scrubber benefit thereafter Nov 21 - Jan 22 Bulk Seoul Oct 19 Koch 22 250 until Dec 20, index linked + scrubber benefit thereafter Dec 21 - Feb 22 Bulk Shanghai Nov 19 Glencore 22 673 Dec 20 Bulk Shenzhen Jan 20 Glencore 21 919 Dec 20 Bulk Sydney Jan 20 Koch 14 002 + scrubber benefit until Dec 20. Index linked thereafter + scrubber benefit thereafter Jan 23 Bulk Sao Paulo Jun 20 Glencore Index linked + scrubber benefit Jun 23 Bulk Santos Jun 20 Glencore Index linked + Scrubber benefit Jun 23

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Strong commercial performance since inception

▪ 2020 Bulkers has outperformed the Baltic Capesize index every month since delivery of the first vessel ▪ Outperformance has been driven by Newcastlemax earnings premium as well as well timed charter coverage

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2 000 4 000 6 000 8 000 10 000 12 000 14 000 5 000 10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000

  • aug. 19
  • sep. 19
  • kt. 19
  • nov. 19
  • des. 19
  • jan. 20
  • feb. 20
  • mar. 20
  • apr. 20
  • mai. 20

Outperformance in USD per day TCE in USD per day

2020 Bulkers Fleet Average Baltic 5 TC 2020 Bulkers Outperformance

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Attractive cash breakeven and strong dividend potential

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  • Operating cash breakeven for the balance of

2020 is estimated at US$14,056 per day

  • Fixed charter coverage on 6 ships covers 97%
  • f estimated operating cash breakeven for the

full fleet of 8 vessels

  • 2020 Bulkers has a policy to over time pay out

the majority of all free cash flow from operations as monthly dividends

1) Based on current budgets and estimates, actual costs and and restults may vary

2H 2020 2021 2022 Available ship days 1 472 2920 2920 Days on fixed timecharter 1 106 Open/index linked days 366 2920 2920 G&A (USD mill) 1,1 2,2 2,2 OPEX (USD mill) 7,1 14,6 15,2 Debt Ammortization (USD mill) 7,4 14,8 14,8 Interest 5,0 9,2 8,7 Operating Cash breakeven (USD mill) 1) 20,7 41 41 Fixed Charter coverage (USD mill) 20,1 Costs to be covered by open/index ships (USD mill) 0,6 41 41 Operating Cash breakeven (USD/ship/day) 14 056 13 983 13 991 Operating Cash breakeven for open/index ships (USD/ship/day) 1 729 13 983 13 991

5 10 15 20 25 30 35 40 45 50 10 000 15 000 20 000 25 000 30 000 35 000 40 000

POtential cash per share available for dividends

Standard Capesize rate

Potential cash flow available for dividends1)

2H 2020 2021

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MARKET UPDATE

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Chinese Iron Ore inventories are at historically low levels

Source: Clarksons

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20 25 30 35 40 45 50

  • jan. 09
  • apr. 09
  • jul. 09
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  • jan. 10
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  • jul. 10
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  • jan. 11
  • apr. 11
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  • jan. 12
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  • apr. 13
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  • jan. 14
  • apr. 14
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  • apr. 19
  • jul. 19
  • kt. 19
  • jan. 20
  • apr. 20

China Iron Ore Ports Inventories, days of consumption

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Brazilian iron ore exports are picking up in line with Vale’s guiding for significant increase in production in 2Q-4Q vs Q1 2020

Strong correlation between Vale production and Capesize rates Brazil exports have been recovering in recent weeks

Sources: Vale, Arrow Shipbroking Group

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  • Vale produced 59,6 million tons of iron ore in Q1 2020
  • Vale’s guidance of 310 – 330 million tons for 2020 implies that run

rate production in Q2-Q4 2020 will be almost 50% above the Q1 2020 production volumes

  • There has historically been a strong correlation between Vale’s

production, Brazilian exports and observed Capesize rates

Volumes estimated based on lastest Vale guidance

5 000 10 000 15 000 20 000 25 000 30 000 35 000 60 65 70 75 80 85 90 95 100 105 Vale production Capesize rate 3 4 5 6 7 8 9 jan jan feb mar mar apr mai mai jun jul jul aug sep okt

  • kt nov des des

Brazil iron ore shipments

Million tonnes, 3-week moving average

2018 2019 2020

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20 40 60 80 100 120 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 DWT m Capesize Bulker Contracting 0% 10% 20% 30% 40% 50% 60% 70% 80% Orderbook as % of fleet Bulkcarrier Orderbook % Fleet

Limited supply growth on the horizon and high scrapping activity

Dry bulk orderbook as % of fleet Capesize bulk newbuild contracts(1) Capesize scrapping(2)

(1) For vessels larger than 20,000 dwt (2) Drybulk vessels larger than 100,000 dwt, Source: Clarkson Research Services Limited, Arrow Shipbroking Group, Tradewinds

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2 4 6 8 10 12 14 16 2017 2018 2019 2020 annualized

Million DWT

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0,00 0,20 0,40 0,60 0,80 1,00 1,20 1,40 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Billion tonnes World Seaborne Total Coal Trade 0,00 0,20 0,40 0,60 0,80 1,00 1,20 1,40 1,60 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Billion tonnes World Seaborne Iron Ore Trade

Trade growth for key commodities traded by Capesize and Newcastlemax has been strong and relatively stable historically

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World seaborne iron ore trade World seaborne coal trade

Source: Clarkson Research Services Limited (SIN)

The iron ore trade has been expanding 25 out of last 29 years, with 5.0% CAGR The coal trade has been expanding 28 out of last 29 years, with 4.7% CAGR