AGM 2020 PRESENTATION CEO HUGO DE STOOP - MAY 2020 FORWARD LOOKING - - PowerPoint PPT Presentation

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AGM 2020 PRESENTATION CEO HUGO DE STOOP - MAY 2020 FORWARD LOOKING - - PowerPoint PPT Presentation

AGM 2020 PRESENTATION CEO HUGO DE STOOP - MAY 2020 FORWARD LOOKING STATEMENTS Matters discussed in this presentation may constitute forward-looking statements under U.S. federal securities laws, including the Private Securities Litigation Reform


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SLIDE 1

AGM 2020 PRESENTATION

CEO HUGO DE STOOP - MAY 2020

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SLIDE 2

FORWARD LOOKING STATEMENTS

Matters discussed in this presentation may constitute forward-looking statements under U.S. federal securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect the Company’s current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. All statements,

  • ther than statements of historical facts, that address activities, events or developments that the Company expects, projects,

believes or anticipates will or may occur in the future, including, without limitation, the delivery of vessels, the outlook for tanker shipping rates, general industry conditions future operating results of the Company’s vessels, capital expenditures, expansion and growth opportunities, bank borrowings, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this presentation are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the failure of counterparties to fully perform their

  • bligations to us, the strength of the world economies and currencies, general market conditions, including changes in tanker vessel

charter hire rates and vessel values, changes in demand for tankers, changes in our vessel operating expenses, including dry- docking, crewing and insurance costs, or actions taken by regulatory authorities, ability of customers of our pools to perform their

  • bligations under charter contracts on a timely basis, potential liability from future litigation, domestic and international political

conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists. We undertake no

  • bligation to publicly update or revise any forward looking statement contained in this presentation, whether as a result of new

information, future events or otherwise, except as required by law. In light of the risks, uncertainties and assumptions, the forward looking events discussed in this presentation might not occur, and our actual results could differ materially from those anticipated in these forward-looking statements.

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SLIDE 3

COVID-19

SUPPORTING OUR PEOPLE IN CHALLENGING TIMES

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  • Approx. 3,600 EMPLOYEES
  • Approx. 3,400 seafarers of many different nationalities
  • Approx. 200 shore employees

Euronav offices Partnerships

Headquarters in Antwerp

  • Wellbeing of Euronav’s community = priority #1
  • Precautionary measures on board and on shore
  • Most of shore staff working from home
  • No employees put under temporary or permanent

unemployment

  • Working hard towards a solution for seafarers who

need to stay on board or get on board

  • Euronav not materially impacted thanks to our

people

  • BELGIUM: 200,000 FFP2 and surgical mouth masks

sourced and donated to hospitals and care centers

  • GREECE: donated respiratory equipment to hospitals
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SLIDE 4

The world’s largest, independent quoted crude tanker platform

International company – internationally connected

4 Euronav offices Partnerships

EURONAV – WHO WE ARE

2 FSO* 2 ULCC

Headquarters in Antwerp

EURONAV – WHO WE ARE

Mix of time charter and spot exposure for the rest of 2020

* Includes JV

46 VLCC incl. 4 N/B

Av Age 7.3 Yrs Av Age 11.1 Yrs

26 Suezmax*

45% 29% 24% 2%

0-5 yrs 6-10 yrs 11-14 yrs 15+ yrs

16% 15% 46% 23%

0-5 yrs 6-10 yrs 11-14 yrs 15+ yrs

19% 81% Fixed days Spot days

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SLIDE 5

EURONAV STRATEGY – SHAREHOLDER FOCUS

Shareholder returns since 2014

Source: Bloomberg

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Source: Euronav

Repayment schedule and RCF reductions

100 200 300 400 500 600

Millions

Bond Maturity Balloon to be refinanced Repayments Reductions

Leverage:

  • 39.5% book value
  • 42% post dividend

payments for 2h 2019 & Q1 2020

  • 50

347 187

  • 9
  • 138

119 226

270 123 45 23 77 172

7 3 32

  • 155
  • 55

45 145 245 345 445

$m net Income, Dividend & Buy back Net Income Dividend Share Buy Back

$1.035bn dividend paid since 2004 $17.76 p/s USD 3.77 DPS since 2015

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SLIDE 6

EURONAV STRATEGY – LIQUIDITY FOCUS

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+$270m 4x VLCC DELIVERY Q4 20 Q1 21

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SLIDE 7

BASE $108 $324 $540 $1,188 +$5,000 per day +$15,000 per day +$25,000 per day +$55,000 per day

EURONAV

OPERATIONAL LEVERAGE WITH CONTRACTUAL INCOME SUPPORT

VLCC TCE rates

$25,000 $30,000 $40,000 $50,000 $80,000

Suezmax TCE rates

$20,000 $25,000 $35,000 $45,000 $75,000

Each $5,000 uplift in both VLCC and Suezmax rates improves net revenue and EBITDA by $108mm FSO contract until 2022 Long term TC contract to 2024 Commercial TC relationships

+

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SLIDE 8

EURONAV 2019 – HIGHLIGHTS

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In USD million

Q1 Q2 Q3 Q4

2019

EBITDA 130.0 71.0 96.8 266.8 564.6 Net Income 19.5

  • 38.6
  • 22.9

160.8 118.9 EPS c per share 8.8

  • 17.5
  • 10.4

73.0 53.9

SHAREHOLDER RETURNS & MOVE TO QUARTERLY DIVIDENDS

35c per share dividend & $35m in buy back

ACTIVE FLEET MANAGEMENT

3x VLCC sale & leaseback, 1x VLCC sold, 1x Suezmax sold, 2x Suezmax bought in JV

BALANCE SHEET STRENGTHENED

Bond upsized to $200m with $1.1bn of cash or revolving credit facilities available

SUCCESSFUL IMPLEMENTATION OF IMO 2020

No Scrubbers – Fuel quality – Shipping emitting 85% less sulphur in the atmosphere

1 2 3 4

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SLIDE 9

EURN SHARE PRICE

2019 YEAR OF PROGRESS

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6 7 8 9 10 11 12 13 EURN US EURN BB

Share buy backs $35m in total Share buy backs

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SLIDE 10

LIQUIDITY OF SHARE TRADING

UP TO USD 40 MILLION PER DAY

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5 10 15 20 25 30 35 40 45 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q12020

USD value traded per day on NYSE and Euronext in Euronav

NYSE USD value traded Euronext USD value traded

Source: Bloomberg

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SLIDE 11

85 90 95 100 105 110

Euronav bond price USD

EURONAV BOND

AN IMPORTANT PART OF OUR FINANCING

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Bonds repurchased by Company Bond size upsized by USD 50m to USD 200m

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SLIDE 12

EURONAV MISSION STATEMENT

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FOR OUR SOCIETY To deliver an essential source of energy in ways that are economically, socially and environmentally viable now and in the future.

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FOR OUR CLIENTS To operate in a manner that contributes to the success of their business objectives by providing flexible, global high-quality and reliable services.

2

FOR OUR SHAREHOLDERS AND CAPITAL PROVIDERS To create significant long-term value by strategically planning financial and investment decisions while efficiently, consistently and transparently act as good stewards of capital.

3

FOR OUR SHAREHOLDERS AND CAPITAL PROVIDERS To attract, inspire and enable talented, hard-working people to develop themselves in order to contribute to our business and its vision in a challenging and rewarding environment.

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SLIDE 13

ESG AT EURONAV, IT’S IN THE DNA

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SLIDE 14

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Social Environmental Governance

Carbon emissions cut 10% in 2019 with 2019 sector leading disclosure >40% Female representation

  • n board

In GEI 3 years running & only transport co Top quartile rank since 2016 in key surveys

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ESG – EURONAV CREDENTIALS

WELL ESTABLISHED WITH FURTHER TO GROW

15 5 10 15 20 25 30 35 2014 2015 2016 2017 2018

Bloomberg ESG Disclosure Score Euronav Tanker Co A Tanker Co B

Source: Bloomberg, Euronav

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OUTLOOK

TANKER MARKET UNDERPINNED UNTIL INVENTORY CYCLE CHANGES

Demand for Oil Supply

  • f Oil

Vessel Supply Ton miles IMO 2020

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2020 temp impact Switch to AG Low orderbook Many ships >15 years Flexible Storage & over supply No Change Negative

ST Coronavirus

ST Positive

Change from Q4

Positive

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CURRENT MARKET HIGHLIGHTS

Storage has further capacity for substantial impact

EIA estimate onshore storage capacity

Source: Bloomberg. IEA, EIA, Broker reports

70 75 80 85 90 95 100 105 200 400 600 800 1000 1200 1400 1600 1800

IEA oil demand & production m bbls Cumulative inventory build m bbls Cumulative inventory build IEA Oil Production IEA Oil Demand 17

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ONSHORE STORAGE

LIMITED TO 1BN BARRELS AND OECD LOCATION FOCUSED

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Source: HIS Markit, EIA, Livemnint, Reuters, various

Likely already approaching full onshore capacity given recent moves to tankers

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SLIDE 19

NOT ALL FLOATING STORAGE IS CREATED EQUAL

0% 2% 4% 6% 8% 10% 12% 14% 16% 50 100 150 200 250

No of Vessels

Dedicated Infrastructure Storage Iranian VLCC Market Storage Suezmax % of VLCC fleet

…and now up to 73 Suezmax now in market storage x2 record high

Storage has ONLY just begun with:

  • 129 VLCCs are currently being used as storage of which :
  • 69 VLCCs taken for market storage in April
  • 38 Iranian
  • 22 infrastructure VLCC in storage before crisis

Source: Bloomberg, Clarksons, Fearnley

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FUTURE MARKET DEVELOPMENTS

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motivated by profit

  • pportunity from

contango price structure involuntary or forced storage due to Covid-19 Restrictions, congestion, supply chain issues part of logistical chain in crude oil supply

Short term

Storage demand is compensating more than decrease of trading demand – rates to remain underpinned

6m Contango Implied TC rate $3 25,000 $4 37,000 $5 46,000 $6 57,000 $8 80,000 $10 100,000

Mid term

Storage phase Storage Draw Global Fleet Re-sizing

Freight rate pressure Fleet oversupplied because of Returning vessels from storage and weaker demand for transportation Global Fleet RE-SIZING could be substantial 2 Scenarios

  • 1. Quick draw

Contango persist and demand for storage ships persist

  • 2. Slow draw

Backwardation means gradual storage draw

Long term

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SLIDE 21

LARGE TANKER FLEET RIPE FOR RE-SIZING

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RISING BARRIERS ORDER BOOK CURRENTLY 23 YR LOW NEWBUILDING CONTRACTS

FINANCING BANKS & CAPITAL MARKETS REGULATION IMO 2030, BASEL IV TECHNOLOGY IN FUEL PROPULSION LONG TERM CRUDE DEMAND

Source: Clarksons, Bloomberg, Euronav

10 20 30 40 50 60

Orderbook as % of fleet

VLCC Orderbook % Fleet Suezmax Orderbook % Fleet

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SLIDE 22

RECYCLING REFLECTS PRESSURE ON OWNERS

STEEL PRICE AND REGULATORY PRESSURE

Source Euronav

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Older tonnage comes under increasing pressure Owners dilemma

Increased opex from IMO2020 Volatile steel scrap price Ballast water capex $1.5m from Sept 19 Lower cash earnings for

  • lder vessels

Older vessels = heavy consumers

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SLIDE 23

LARGE TANKER FLEET RIPE FOR RE-SIZING

11.5 9 10 6.5 4 11 6.5 9 16 10.5 14 6.5 11 9 11 9.5 6.5 8 8.5 8 3.5 5 3 0.5 3.5 3 4.5 2.5 0.5 4.5 3.5 3 5 10 15 20 25 30 35 40 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21

No of VLCC equivalents

SS 15 yr SS 17.5 yr SS 20 yr SS 22.5 yr SS 25 yr

EACH QUARTER TO END 2021 - 27 VLCC EQUIVALENTS MUST UNDERTAKE A SPECIAL SURVEY

FLEET AGE RISING – 26% VLCC FLEET >15 YEARS (@ 1 JANUARY 21)

Source: Clarksons

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