A.P. Mller - Mrsk DDF: Virksomhedsdagen , June 2013 Forward-looking - PowerPoint PPT Presentation

A.P. Møller - Mærsk DDF: Virksomhedsdagen , June 2013

Forward-looking Statements This presentation contains forward-looking statements. Such statements are subject to risks and uncertainties as various factors, many of which are beyond A.P. Møller - Mærsk A/S’ control, may cause actual development and results to differ materially from the expectations contained in the presentation. Page 2 – DDF Presentation 2013

Agenda Executive summery 1. Setting the stage 2. Strategy and ambitions  Maersk Line  Maersk Oil  APM Terminals  Maersk Drilling 3. Portfolio Management 4. Financing 5. Q&A Page 3 – DDF Presentation 2013

Company profile The A.P. Moller - Maersk Group is represented in 130 countries, employing around 121,000 people and is headquartered in Copenhagen, Denmark. Our market cap is USD 32bn and the Group reported USD 4bn net profit in 2012. Facilitating global containerized trade Maersk Line carries around 14% of all seaborne containers and, together with APM Terminals and Damco, provides infrastructure for global trade Supporting the global demand for energy The Group is involved with production of oil and gas and other oil related activities including drilling, offshore services, towage and transportation of crude oil and products Page 4 – DDF Presentation 2013

Strategy and ambitions Group strategic focus  Invest in profitable growth with the objective to at least meet the Group’s historical ROIC at 10% over the cycle;  USD > 1bn profit contribution from each of the four core growth units;  Continue historical trend of increasing dividends per share supported by underlying earnings growth;  Secure liquidity buffer and maintain a conservative capital structure;  Comply with the financial ratios required of a strong investment grade rated company – over the cycle Page 5 – DDF Presentation 2013

Building four world class businesses Maersk Line Maersk Oil APM Terminals Maersk Drilling Opportunistic core Damco | Svitzer | Maersk Tankers | Maersk Supply Service Strategic investments Dansk Supermarked | Danske Bank Assets managed for value DFDS | Höegh Autoliners | Others Page 6 – DDF Presentation 2013

Executing on Group strategy Q1 2013  Profit was USD 790m and ROIC was 8.0%  Maersk Line reduced unit costs mainly through vessel network efficiencies and increased rates enabled through active capacity adjustments  Maersk Oil executed on;  Two field development plans approved (Balloch, UK and Tyra SE, DK)  The El Merk field in Algeria went on stream  Entitlement production declined, while production stabilised when adjusted for the reduced share of DUC  2P reserves increased 4% in 2012  APM Terminals and Maersk Drilling are on track  Balance sheet prepared for future investments as net interest-bearing debt declined by USD 1.1bn during Q1 Page 7 – DDF Presentation 2013

The group is in a good position to capitalize on growth in emerging countries - more than half of our profit comes from here ... Page 8 – DDF Presentation 2013

... which also entails risks. Page 9 – DDF Presentation 2013

Maersk Line Strategic focus  Top quartile performer  EBIT margin 5% above peers  Growing with market and funded by its own cash flow  Delivering stable returns above cost of capital  Getting value premium from customers Page 10 – DDF Presentation 2013

Maersk Line EBIT margin gap to peers EBIT-margin, pp Gap to peers 15% 13% 10% 10% 07% 07% 05% 06% 05% 05% 05% 05% 05% 5% 04% 04% 03% 03% 01% 01% 01% 01% 0% 00% -02% -5% 08Q1 08Q3 09Q1 09Q3 10Q1 10Q3 11Q1 11Q3 12Q1 12Q3 13Q1 Note1: The peer group includes CMA CGM, Hapag-Lloyd, APL, Hanjin, Hyundai MM, Zim, NYK, MOL, CSCL, COSCO and OOCL. Averages are TEU-weighted Note2: CSCL, COSCO and OOCL only provide interim financials, hence their Q1/Q2 EBIT margin is based on their H1 gap and Q3/Q4 EBIT-margin is based on their H2 gap to ML. 13Q1 Chinese carriers’ EBIT margin has been proxied using the average of 08H1 to 12H2 gap to MLB Note3: EBIT margins are adjusted for gains/losses on sale of assets, restructuring charges, income/loss from associates. In addition ML ‟ s EBIT margin is also adjusted for depreciations to match with industry standards. Source: Internal reports, competitor financial reports Page 11 – DDF Presentation 2013

Maersk Oil Strategic focus  Producing >400,000 boepd  Double digit returns  Building reserves towards 10 years production  Strong transparent organisation Page 12 – DDF Presentation 2013

Maersk Oil’s portfolio Project Maturation Process Exploration Production Resources Reserves Prospects in Initiate & Assess Select Define Execute Assets the pipeline Discoveries Diamante Torvastad Dunga III Denmark Farsund Mangesh Griffon Jack II Golden Mjosa Mulavi Johan Sverdrup Eagle Kazakhstan Jack I Rothesay Swara Valdemar WI Zidane Tika East Ockley UK Buckskin Bo Kopervik Flyndre & Jackdaw Xana Chissonga Cawdor Tyra LE Itaipu Rascasso Tyra SE Algeria Courageous Blackjack Wahoo Culzean Oceanographer Qatar Caporolo Swara Tika Gara FDP 2012 AddaTyra L Cret Total of 110 exploration Azul- prospects and leads in Quad 9 Brazil Celeste- the exploration pipeline gas blow-down Turquesa 110 11 40 22 13 12 Total no. of projects per phase Uncertainty Bubble size indicates estimate of net resources: Colour indicates resource type: Discoveries and prospects >100 mmboe 50-100 mmboe <50 mmboe Primarily oil Primarily gas (Size of bubbles do not reflect volumes) Page 13 – DDF Presentation 2013

APM Terminals Strategic focus  Best port operator in the world  Strong brand; at least 50% revenue from third party customers  More attractive terminals in growth markets  USD >1bn annual profit (NOPAT) in 2016 Page 14 – DDF Presentation 2013

APM Terminals: Projects under implementation Gothenburg CTW MV2 Poti Vado Izmir Aqaba Ph 2 SCCT Ph 2 Ningbo Pipavav Lazaro Cardenas Onne Moin PTP Monrovia Apapa Ph2 Callao Santos Projects under implementation Initiation phase Planning phase Execution phase Completed Page 15 – DDF Presentation 2013

Maersk Drilling Strategic focus  Top quartile performer  Up to 30 high-end rigs mainly for harsh environment and deep water  USD >1bn profit annual (NOPAT) in 2018 Page 16 – DDF Presentation 2013

Maersk Drilling: Fleet expansion with good contract coverage Maersk Drilling fleet Contract backlog # units 30 100% 98% 90% 25 23 80% 22 79% 70% 20 17 60% 16 16 16 15 15 50% 51% 11 10 10 40% 10 41% 8 30% 20% 5 10% 0 0% 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E 2013 RoY 2014 2015 2016 Standard jack-ups High-end jack-ups Ultra harsh jack-ups Midwater floaters Ultra deepwater floaters Page 17 – DDF Presentation 2013

Capital is focused on our core growth business Invested capital Our portfolio strategy towards 2017  Maersk Line  Maersk Oil  APM Terminals At least 75% of the invested capital is  Maersk Drilling  Other within the four core growth businesses Q1 2012 Maersk Line’s share of the Group’s invested capital is likely to be reduced towards a 25–30% range 33% 37% Maersk Oil, APM Terminals and Maersk Drilling’s USD 52,243m combined share of the invested capital will increase towards a 45–50% range 7% 14% Growing the business by 30–40% 9% Recent portfolio development – Q1 2013 Q1 2013 Maersk growth strategy continues with invested capital 29% growing 1.6% compared to Q1 2012 39% Portfolio optimization with the four core growth USD 53,086m businesses’ share of the Group’s invested capital growing 9% to 71% from 67% a year ago 11% 12% Reduction in Maersk Tankers’s fleet, the divestment of Maersk LNG and the sale of FPSOs mainly explain the lower invested capital in the other business operations Page 18 – DDF Presentation 2013

Active portfolio management Cash flow and gains from divestments  Cash flow from divestments  Divestment gains (pre-tax) Cash flow from divestments of USD 10.4bn since 2007 with a 3500,0 pre-tax gain of USD 4.4bn since 2007 3000,0 The Group made gross 2500,0 investments of USD 9.7bn in long- term growth in 2012, whereof 90% 2000,0 were focused on the four core growth businesses 1500,0 1000,0 Divestments of assets and activities for USD 3.4bn in 2012, with Maersk LNG and FPSO 500,0 Maersk Peregrino as the largest transactions ,0 2007 2008 2009 2010 2011 2012 Page 19 – DDF Presentation 2013