AGM Presentation Paddy Rodgers, CEO May 2017 1 Forward Looking - - PowerPoint PPT Presentation

1 Paddy Rodgers, CEO May 2017

AGM Presentation

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

• ther statements, which are other than statements of historical facts. All statements, other 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 obligations 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 obligations 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 obligation to publicly update or revise any forward looking statement contained in this presentation, whether as a result of new information, future events or

• therwise, 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.

Forward Looking Statements

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Company Overview & Financials Current Industry Dynamics Our Strategy Current Themes Outlook for 2017 1 2 3 4 5

Agenda

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Section 1

Company Overview and Financials

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4

INTRODUCTION

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1. Adjusted EBITDA (a non-IFRS measure) represents operating earnings including the share of EBITDA of equity accounted investees before interest expense, income taxes and depreciation expense attributable to Euronav 2. Only 4 V-Plus vessels in world fleet

• Leading provider of transportation and storage of

crude oil

• The largest tanker ship owner in the world with a fleet
• f modern high quality tankers
• Best-in-class fully-integrated operating platform
• Strong relationships to oil majors and leading energy

companies

• Conservative financing strategy with a strong balance

sheet and high liquidity

• Head quartered in Antwerp with ca 180 employees

shore side and globally 3,000 seafarers

• Listed on NYSE (TICKER: EURN) with a market

capitalization of USD ~1.3 billion (as of 9 May 2017)

921 830 239 648 504 1,235 2016 2014 2015

• Adj. EBITDA

Net interest bearing debt

FINANCIAL SUMMARY (USDm) 3 MM barrels 2.8 MM barrels

31 VLCC Up to 330,000 DWT 2MM barrels 1MM barrels 19 SUEZMAX (+2 NBs) 150,000 – 165,000 DWT 1 V – PLUS (2) Over 441,000 DWT 2 FSO Stripped water capacity 380k barrels Only 4 in world fleet

CURRENT FLEET – TOTAL 55 VESSELS – 13.7 MM DWT

Euronav is the largest tanker company in the world

Purchased 19 VLCCs IPO NYSE Purchased 4 VLCCs Purchased 2 VLCCs 4 Suezmax on 7 year TCE

A YEAR OF TWO HALVES Very strong 1h with challenging but profitable 2h Robust market fundamentals continued into 2017

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EXTENDING POOLING TO SUEZMAX SECTOR Marketing Joint Venture established May 2016 Diamond S Shipping & Frontline partners - 40 vessels in total

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DIVIDEND – COMMITMENT DELIVERED Policy to return 80% net income* - delivered May 2016: $ 0.82 Sept 2016: $ 0.55 May 2017: $ 0.22

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ACTIVE PORTFOLIO MANAGEMENT Suezmax and VLCC Joint Ventures consolidated Fleet renewal - 2 VLCCs resales bought September 2016

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In USD million

Q1 Q2 Q3 Q4 Full Year EBITDA 185.0 113.6 74.6 130.1 503.3 Net Income 113.5 40.1 0.07 50.0 203.7 EPS c per share 72.0 25.0 0.0 32.0 129.0

* Pre capital gains.

2016 – Year of Consolidation

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In USD per day First quarter 2017 First quarter 2016

VLCC

Average spot rate (TI Pool)

40,528 60,638

Average time charter rate*

41,147 40,847

SUEZMAX

Average spot rate**

23,957 38,386

Average time charter rate*

23,880 32,251

* Including profit share where applicable ** Excluding technical off hire

1 2 3 4

Respectable Q1 rate performance – ahead of Q4 2016 ($33k VLCC & $21k Suezmax for Q4 2016) Increased ton miles reflected in more Atlantic to Far East activity Outlook Q2 VLCC so far: 42% fixed at 32,000 USD per day Q2 Suezmax so far: 47% fixed at 22,000 USD per day

VLCC Suezmax

Cash B/E Q1 16 Q1 17 10000 20000 30000 40000 50000 60000 70000

USD/day

Cash B/E Q1 16 Q1 17 5000 10000 15000 20000 25000 30000 35000 40000 45000

USD/day

Challenging rate environment Q2; seasonality & OPEC cuts begin to bite

Highlights – Q1 2017

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1 2 3 Leverage: 43% marked to market (36% book value)

HIGHLIGHTS

Liquidity position Further strengthened – providing optionality for cycle

LIQUIDITY POSITION (31 MARCH 2017) 2017 2016

(in $ million)

mrt/17 dec/31 Cash 106.6 206.6 Restricted cash 0.1 0.1 Other current assets 179.1 166.7 Long term assets: Newbuildings 12.5 86.1 Vessels 2,503.4 2,383.2 Other long term assets 212.7 204.2 Total assets 3,014.5 3,046.9 Current liabilities 174.4 189.1 Long term debt 913.9 966.4 Other long term liabilities 3.6 3.4 Equity 1,922.6 1,887.9 Total liabilities and stockholders' equity 3,014.5 3,046.9 Cash & Cash equivalent (incl. share of JV): USD 149m Undrawn secured revolving facility USD 411m Undrawn unsecured credit line USD 60m Total Liquidity :

• ca. USD 620m

BALANCE SHEET

Financial Highlights – Balance Sheet

CAPEX and newbuild debt capacity (current)

• Newbuilding Capex (4 Suezmax

w/ contracts) = USD 236m

• Total estimated lending capacity

= USD 175m

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Section 2

Current Industry Dynamics

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Demand for Oil ROBUST

• Oil demand growing

last 25 years with yearly average 1.1 mbpd

• IEA forecast 1.4 mbpd

pa growth 2017

• Only 2 negative years
• f growth since 1990 for

global crude demand

Supply of Oil

BALANCED

• OPEC cut = Non OPEC

increase supply

• USA production shale

New Swing Producer very resilient & responsive

• OPEC cuts may have

impact but for how long?

Vessel Supply S/TERM HEADWINDS L/T MANAGEABLE ONLY IF OWNERS ARE DISCIPLINED

• Seasonal trends

impacted by factors increasing tonnage

• Contracting rate fallen

substantially & shipyards under reform pressure

Ton Miles

CHANGEABLE

• Atlantic sourced

barrels been replaced by primarily by Middle East supply reducing ton miles

• USA crude exports to

increase ton miles from 2017

Financing & Regulation

NEW BARRIER TO ENTRY

• New regulations

(Basel 3 & 4) restricting lending

• Distress in shipping

loans has reduced risk appetite

1 2 3 4 5

Assuming no speculative building

Oil Tankers – 5 key medium term drivers

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1 Demand growth (million bpd)

Y/Y CHANGE IN GLOBAL DEMAND FOR OIL THE IEA ESTIMATES FOR OIL OIL PRICE OUTLOOK 11

10 20 30 40 50 60 70 80 90 2015 2016 2017 2018 2019 2020 2021 2022 2023 USD per barrel Demand/supply Disruptive Demand stimulating Neutral Demand Destructive Capex cuts in E&P Lack of disruption/market share game

Source IEA, McQuilling, Bernstein, Barclay, Petrowin and Bloomberg 0.3 1.0 0.5 0.3 1.0 1.5 1.9 2.0 0.3 1.7 0.8 0.7 0.7 1.5 3.1 1.4 1.0 1.6

• 0.7
• 0.9

3.1 0.8 1.1 1.3 0.7 1.8 1.6

• 1
• 0.5

0.5 1 1.5 2 2.5 3 3.5 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Million barrels per day

Average 1.1 million barrels per day 1.2 1.4 1.5 1.6 1.3 1.4 1.4 1.4 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 1.8 Nov 16 Dec 16 Jan 17 Feb 17 2016 forecast for oil demand 2017 forecast for oil demand

Demand for Oil – robust and steady

10 20 30 40 50 60 70 80 90 USD

0.6 2.5 3.0 3.1 3.3 3.5 4.4 4.6 5.0 5.7

Average field development (approval to start up) time by resource [years, selected areas]

Source SBC Analysis, Rystad Source Economist Source CLSA

2

84,000 86,000 88,000 90,000 92,000 94,000 96,000 98,000 2012 2013 2014 2015 2016 2017 mbpd

OIL SUPPLY ELEVATED BUT PRICE CAPPED SHALE OIL SPEED TO PRODUCTION IS KEY GLOBAL OIL SUPPLY IS GROWING MOST SHALE PRODUCTION KICKS IN AGAIN @ USD 50 12

Source IEA

Supply of oil – driven by Shale & new supplier dynamics

Ton miles increasing

1.4 mbpd x 365 days = 511m barrels 511m barrels / 2m capacity per VLCC = 256 cargoes 256 cargoes / 9 annual journeys for VLCC MEG – F East = 28 VLCCs Arabian Gulf to China 5,500 miles 21 days West Africa to China 9,650 miles 33 days LatAm to China 11,500 miles 44 days

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1.4 mbpd x 365 days = 511m barrels 511m barrels / 2m capacity per VLCC = 256 cargoes 256 cargoes / 4.5 annual journeys for VLCC Atlantic – F East = 57 VLCCs

Average oil demand growth 1990-2016 =1.1 mbpd

Importer Exporter

Supply Demand Demand Supply 3

DEMAND GROWTH ALL FROM FAR EAST – FOR TANKERS IMPORTANT WHERE SUPPLY IS SOURCED FROM

Source Euronav, Morgan Stanley

West Africa LatAm / Caribs Middle East Asia Pacific China

28 VLCCs 57 VLCCs LatAm / Carbs - Asia Pacific route Middle East - Asia Pacific route

Large tanker market – moving toward equilibrium

14 DEMAND AND SUPPLY INTERACTION ON VLCC EQUIVALENTS 2016-2019 WHAT IEA DEMAND TRANSLATES INTO VLCC EQUIVALENTS REQUIRED PA

2016 2017 2018 2019 Total VLCC to be delivered 45 51 50 17 Total Suezmax equivalent to be delivered* 12 32 10 VLCC equivalents to be delivered* 57 83 60 17 +/- Gibsons Scrapping forecast

• 18
• 23
• 25
• Demand based on IEA forecast

49 43 37 37 IEA demand forecast bpd m 1.6 1.4 1.2 1.2 = Yearly Net Surplus/(Deficit) 22

• 45

Cumulative Surplus/(Deficit) 8 30 30

• 15

IEA demand forecast m bpd VLCC equivalent* IEA demand forecast m bpd VLCC equivalent*

1.6 49 1.1 33 1.5 46 1.0 30 1.4 43 0.9 27 1.3 40 0.8 24 1.2 37 0.7 21

Source Clarksons, Gibsons * VLCC equivalent = 1 VLCC = 2 Suezmax

SUPPLY DEMAND

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• 20

20 40 60 80 100 2016 2017 2018 2019 VLCC Equivalents

VLCC Equivalents to be delivered* Demand based on IEA forecast Cumulative Surplus/(Deficit)

Section 3

Our Strategy

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15

58 36 18 (+4 NB)

SUEZMAX CHARTERING

12 13 12

VLCC POOL SUEZMAX POOL

Other VLCC Tanker Pools (Ships on the Water)

Source: Company reports 17 February 2017

Heidmar – VLCC Seawolf

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Navig8 – VL8

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China VLCC

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37 Size is critical to improve market knowledge and achieve the best commercial terms

Main Tanker Clients

Fleet managed in pool structure provides benefits

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Euronav focused on prudent consolidation…

Source Clarkson’s – Total 715 VLCC ships @ 9 May 2017

Red indicates Captive or Sovereign fleet Blue indicates fleet in stock listed companies

Small owners are data deficient (275 VLCCs)

17 BARRIER TO ENTRY – INFORMATION Value Adjusted Equity ratio* (%) DYNAMICS IN THE SHIPPING INDUSTRY

• Crude tanker business slowly industrialising
• Low rate environment enables market consolidation
• Euronav plays a key role in the tanker market

consolidation

• Tanker companies have 3 main counterparties – Oil

majors, Refinery majors and Oil traders

• All 3 have excellent credit risk and exposure
• However freight rates likely to retain some volatility as

each cargo carriage price is set on an auction basis

• Strong ship owners utilize downturns pro actively

TANKER MARKET CONSOLIDATION

Differentiate spot players vs industrial players

1 Ship Owner, 29 Vessels 2 Ship Owner, 34 3 Ship Owner, 27 10 – 15 Ship Owner, 130 Euronav NV, 32 4 – 10 Ship Owner, 185 DHT, 22 Nippon Yusen, 19 Gener8 Maritime , 24 Angelicoussis Group, 31 Bahri, 37 MOL, 31 NIOC, 40 China Merchants, 41

Top 10 Owners Control 43%

• f Global

VLCC Fleet

6 5 16 14 32 11 10 10 22 21 25 34 31 30 39 46 49 22 22 24 26 27

37 32 22 42 46

17 17 31 31 32

124 116 142 206 241

0% 5% 10% 15% 20% 25% 50 100 150 200 250 300 2012 2013 2014 2015 2016

% of VLCC/Suezmax fleet Number of VLCC/Suezmax

DHT* TNK GNRT EURN NAT FRO BAHRI % of fleet

Captive = 65 Spot market = 65

China COSCO, 33

* Incl BW fleet

• Tanker business is cyclical, towards which the only

cure is to have a strong balance sheet and a liquidity pool

• Euronav has a very strong liquidity pool that

creates a 3 year runway through the cycles

• Policy to retain two years of operational liquidity at

all times and maintain strong banking relationships

LIQUIDITY MARCH 2017 (USDm)

620 149 60 411 Total liquidity pool Undrawn secured revolving facility Undrawn unsecured credit line Cash and cash equiv.

2

Since 2014

25 VESSELS ACQUISITION HIGH DIVIDEND YIELD

MAINTAIN STRONG BALANCE SHEET ≈ 50% (Leverage)

+

• 1. KEEP STRONG BALANCE SHEET
• 2. RIGHT MIX OF EQUITY & DEBT
• 3. KEEP OR LOWER AVERAGE BREAK-EVEN

1

ACQUISITION CRITERIAS

Leverage

As evidenced by

STRONG BALANCE SHEET HEDGE TOWARDS CYLICALITY CAPITAL ALLOCATION KEY TO GROWTH STRATEGY

…achieved with a strategy of strong capital allocation

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Section 4

Current Themes

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USA EXPORTS GROWING STRONGLY – OFFSETTING OPEC/NON OPEC PRODUCTION CUTS 20

300 350 400 450 500 550 600 650 700 750 800 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17

(‘000 barrels per day )

21 days carriage 45 days carriage

Source Clarkson

Current themes – Ton miles remain dynamic & positive

NUMBER OF VESSELS ORDERED PER MONTH SINCE 2016 IN VLCC AND SUEZMAX

Source Clarkson - data to 9 May 2017

Current themes – short term rise in orders

1 2 3 4 5 6 7 8 9 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May 2016 2017 VLCC Suezmax

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0.00x 2.00x 4.00x 6.00x 8.00x 10.00x 12.00x 14.00x

40 60 80 100 120 140 160

Value / EBITDA $m per 5 year old VLCC

Value / EBITDA VLCC 5 Year Old Values

EURONAV ACQUISITION OF MAERSK FLEET

INFLATION ADJUSTED 5 YEAR OLD VLCCs COMPARED WITH ASSET VALUE/EBITDA

Source RMK

Current themes – Asset values finding a floor

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Section 5

Outlook for 2017

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Euronav well positioned for the cycle

• Balance sheet

strength with proven focus on shareholder value

• Euronav has

USD 620M available liquidity

• Euronav has

lowest leverage in the sector

• USD 0.22

dividend per share to be paid end May*

* Subject to approval at AGM 11 May 2017

EURONAV HAS CONSISTENTLY RAISED AVAILABLE LIQUIDTY YET ALSO RETURNED $391M IN DIVIDENDS SINCE 2015

Source Euronav, Bloomberg, Clarkson

10 20 30 40 50 60 70 80 90 100 100 200 300 400 500 600 700 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017

VLCC rate per day $000 $m EBITDA (Proportionate) Cumulative Dividend Liquidity VLCC rate

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Demand for Oil ROBUST Supply of Oil OPEC CUTS CONTINUING? Vessel Supply S/TERM HEADWINDS L/TERM MANAGEABLE Ton Miles CHANGEABLE BUT IMPROVING Financing NEW BARRIER TO ENTRY 1 2 3 Ton miles improved in Q1 reflecting increased Atlantic to Far East trade Euronav Balance Sheet remains strong providing optionality Recent VLCC contracting activity a concern

Change from Q4

No Change Deteriorated Improved No Change No Change

Outlook for 2017

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