PRECIOUS SHIPPING PUBLIC COMPANY LIMITED SET Opportunity Day, - - PowerPoint PPT Presentation

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PRECIOUS SHIPPING PUBLIC COMPANY LIMITED SET Opportunity Day, - - PowerPoint PPT Presentation

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PRECIOUS SHIPPING PUBLIC COMPANY LIMITED SET Opportunity Day, Website http://www.preciousshipping.com 11th Floor, SET Building, E-Mail psl@preciousshipping.com 0900 Hours, 22nd February 2010 . 1 Precious Shipping PCL Industry

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SLIDE 1

Precious Shipping PCL

PRECIOUS SHIPPING PUBLIC COMPANY LIMITED

Website http://www.preciousshipping.com E-Mail psl@preciousshipping.com

SET Opportunity Day, 11th Floor, SET Building, 0900 Hours, 22nd February 2010. 1

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SLIDE 2

Precious Shipping PCL

Industry Overview

2

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SLIDE 3

Precious Shipping PCL

SHIPPING COMMERCIAL CRAFTS DRY TRADES

PASSENGER

CARGO

CRUISE FERRIES

DRY CARGO SMALL HANDY 10-30,000 DWT

HANDYMAX 30-50,000 DWT SUPER HANDYMAX 50-60,000 DWT PANAMAX 60-80,000 DWT MULTI PURPOSE CAR CARRIERS TRAWLERS CONTAINERS REEFERS TANKER TRADES CHEMICAL GAS CLEAN CRUDE CAPESIZE 80,000+ DWT

PSL

INDUSTRY OVERVIEW

3

TYPE OF VESSELS

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SLIDE 4

Precious Shipping PCL

PSL Fleet

Number Of Vessels * 22 Average Age (Simple Average) 15.82 years Insured Value/Market Value * USD 283.50 Million Book Value USD 207.25 Million Total DWT 549,559 Total LDT 122,941 Average DWT per Vessel 24,980 Aries Valuation as on 1st Jan 2009: USD 232 Million (21 Ships)** Aries Valuation on 1st Jan 2008: USD 695 Million (21 Ships)** Aries Valuation as on 1st Jan 2007: USD 399 Million (21 Ships)**

4 * As on 12th February 2010 ** Excluding new acquisitions in 2010

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SLIDE 5

Precious Shipping PCL

500 2500 4500 6500 8500 10500 Dec-85 Dec-86 Dec-87 Dec-88 Dec-89 Dec-90 Dec-91 Dec-92 Dec-93 Dec-94 Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09

BDI

The Market as manifested by the BDI

BDI (Cape, Panamax, Supramax and Handy) All time High - 11793 – 20th May 2008 Recent low – 663 – 5th December 2008 Previous Highs - 11039 – 13th November 2007

  • 6208 – 6th December 2004
  • 4,291 – 3rd June 2009

All Time Low - 554 - July 1986 Latest – 2,575 – 11th Feb 2010 Largest daily fall – 963 – 12th June 2008 5

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SLIDE 6

Precious Shipping PCL

Baltic Dry Index (BDI) - Annual Averages

6

1,137 2,617 4,510 3,371 3,180 7,065 6,390 2,617 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 2002 2003 2004 2005 2006 2007 2008 2009 Index Value

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SLIDE 7

Precious Shipping PCL

2009 the year of the Unexpected

7

  • China Iron Ore imports:
  • Estimated: +/- 10% over 2008
  • Actual: +42% over 2008
  • China Steel production:
  • Estimated: -10 to -20% over 2008
  • Actual: +14% over 2008
  • China Coal imports ~ 120 MMT instead of the usual 80 to 85 MMT of Coal exports.
  • Congestion: +5% of the entire Dry Bulk world fleet.
  • Under utilization of the world fleet due to problems with Trade Finance, Import / Export

bans etc.

  • Slippage in delivery of New Ships: 41%
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SLIDE 8

Precious Shipping PCL Source : Bloomberg/other news

China - Some Facts

8

  • Shanghai has built more skyscrapers in the past 15 yrs than New

York did in a century

  • Iron Ore imports: for 2006: 326 MMT, for 2007: 383.6 MMT, for

2008: 444 MMT, for 2009: 628 MMT or 41.5% above 2008 and expected to reach 675 MMT in 2010!!

  • Coal Imports: 2007: 51 MMT, 2008: 41 MMT, 2009: 120 MMT,

expected for 2010 +150 MMT after being an exporter of about 80 MMT per annum for last decade!

  • Coal production increased to 3.3 BMT and needs to grow to

sustain Electricity demand.

  • Steel Production: 2004: 280.5 MMT, 2005: 349.5 MMT, 2006: 421

MMT, 2007: 490 MMT, 2008: 502 MMT, 2009: 566+ MMT and expected to reach 575+ MMT in 2010.

  • Steel Exports: 05: 27.6 MMT, 06: 52 MMT, 07: 63 MMT, 08: 59.2

MMT, 09 estimated 37 MMT.

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SLIDE 9

Precious Shipping PCL Source : Bloomberg/other news

Summary of Fundamental Demand Drivers

9

  • World population is increasing and we shall hit 7 Billion

people by 2012!

  • More wealth has been created in the last 2 decades than ever

before as measured by the number of millionaires!

  • Eating habits have changed from a vegetarian diet to a more

meat oriented diet requiring much more grain to be transported.

  • Urbanization is growing by leaps and bounds. In 1950 it was

29.1% by 2000 it had leaped to 47.1% or 2.9B people, and by 2010 it is expected to be 51.3% or 3.5B people!

  • Infrastructure development is continuing. In the GCC countries

they are spending USD 2.4T on Infrastructure and Urbanization.

  • Infrastructure in the developed world is old and dilapidated

and needs to be fully over-hauled and revamped.

  • Concerted world-wide Government stimulus plans in $ Trillions!
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SLIDE 10

Precious Shipping PCL

Supply Side Analysis

10

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SLIDE 11

Precious Shipping PCL

Dry Bulk Fleet as of 1st January 2010

Ship Type DWT Range (MT) Ships Av Age ( yrs) Total DWT ( m MT) Av DWT (MT) % of DWT Small Handy* 10,000 - 29,999 3126 18.8 62.04 19,846 12.96% Handymax 30,000 – 39.999 965 17.8 33.71 34,936 7.04% Super Handymax 40,000 – 59,999 1865 11.9 91.91 49,284 19.20% Panamax 60,000 – 89,999 1553 12.9 113.81 73,281 23.78% Capesize 90,000+ 1033 11.4 177.21 171,545 37.02% Total / Average 8542 15.2 478.68 56,038 100%

11

Source : CRS/Aries

* Small Handy includes tween deckers of 10-30K DWT

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SLIDE 12

Precious Shipping PCL

12

Source : CRS/Aries

Industry Overview – Small Handies ( As of 1st Jan 2010)

9.10% 3.80% 0.90% 0.10% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 9.00% 10.00% '10 '11 '12 '13 As % of fleet size as at 1st Jan 2010

NEW BUILDINGS ON ORDER UPTO DEC 2013 (13.9%)

Number of Ships 285 118 27 2 Average Size (DWT) 18,801 19,429 22,681 29,000

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SLIDE 13

Precious Shipping PCL

13

Source : CRS/Aries

POTENTIAL SCRAPPING OF SHIPS 27 YEARS OR OLDER UPTO DEC 2013 (49.80% !) Industry Overview – Small Handies ( As of 1st Jan 2010 )

37.40% 4.90% 4.80% 2.70% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% '10 '11 '12 '13 As % of fleet size as at 1st Jan 2010

Number of Ships 1,169 152 151 83 Average Size (DWT) 18,844 22,716 22,138 21,465

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SLIDE 14

Precious Shipping PCL Source: CRS - PSL

Confirmed Orders as of 01 Jan 2010, all ships (to 2013)

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274.43 212.00 62.43 100.00 77.25 22.75 0.00 50.00 100.00 150.00 200.00 250.00 300.00 DWT ( million MT) %age Total Estabilished Yards Green Field Yards

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SLIDE 15

Precious Shipping PCL Source: CRS - PSL

Confirmed Orders: Established vs Green Field Yards As of 1st Jan 2010

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91.9 62.0 33.7 177.2 113.8 6.4 118.7 32.8 36.3 17.8 35 9.6 10.7 5.2 1.9 17.5 33.8 39.7 30.6 24.7

0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 160.0 180.0 200.0

C a p e s i z e P a n a m a x S u p r a m a x h a n d y m a x h a n d y s i z e

DWT ( million MT) Existing DWT as of 1st Jan 2010 Estabilished Yards Green Field Yards Potential scrappings(upto 2013)

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SLIDE 16

Precious Shipping PCL Source: CRS - PSL

Confirmed Orders: Established vs Green Field Yards As of 1st Jan 2010

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291 187.6 151.5 60.5 44.6 17.8 64.40 81.90 50 100 150 200 250 300 350 Cape+Panamax Supramax+Handymax+Handy DWT ( million MT) Existing DWT as of 1st Jan 2010 Estabilished Yards Green Field Yards Potential scrappings(upto 2013)

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SLIDE 17

Precious Shipping PCL Source: Aries

Contract values second hand ships (1999-2008)

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36.1 52.5 35.8 27.2 28.8 16.8 5.7 7.8 8.9 7.9 10 20 30 40 50 60 1 9 9 9 2 2 1 2 2 2 3 2 4 2 5 2 6 2 7 2 8 Value ( bn USD)

Value ( bn USD)

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SLIDE 18

Precious Shipping PCL

Owners, Financiers, Relationship (What Relationship?)

18

  • Total value of the second hand market between 2004 – 2008: USD 180.4 bn
  • If 65% was funded by debt, Shipping Banks are on the hook for: USD 117.26 bn
  • Value drop across the spectrum of ships has been savage, say, 70%
  • Owners would have funded 35% or about USD 63.14 bn which has been wiped out!
  • Value of the ships purchased in the last 5 years would now be about: USD 54.12 bn
  • Shipping Banks would have to write down enormous amounts, around: USD +60 bn!
  • Obvious changes in the ‘normal’ relationship would be:
  • Minimal or no more funds available to lend and if at all then only to:
  • Well known and ‘good’ owners with long term contracts to ‘good’ clients
  • Margins would sky-rocket
  • Repayment periods would be shortened
  • Covenant ‘heavy’ legal documents would have to be signed for any such funds
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SLIDE 19

Precious Shipping PCL Source: CRS

Estimated contract values new buildings (2009-2012)

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188 196 151 57 50 100 150 200 250 2 9 2 1 2 1 1 2 1 2 Value ( bn USD)

Value ( bn USD)

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SLIDE 20

Precious Shipping PCL

Estimated contract values - new buildings (2009-2012)

592 bn USD over 4 years

…or 324 million USD per day

…or 13.50 million USD per hour

…or 225,000 USD per minute

… or 3,750 USD per second !

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SLIDE 21

Precious Shipping PCL

Slippage in Delivery of New Buildings

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SLIDE 22

Precious Shipping PCL

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Source : CRS/Aries

Dry Bulk Fleet - New Buildings Projected vs Delivered DWT

16.63 13.79 13.03 11.69 18.95 20.36 22.64 20.57 26.52 21.01 27.92 24.11 31.51 24.16 73.17 43.16

10 20 30 40 50 60 70 80

DWT m MT

2002 2003 2004 2005 2006 2007 2008 2009

Year

Projected Delivered

%age Average slippage 2002-2007: -10.6% %age Slippage for 2008:

  • 23.3%

%age Slippage for 2009:

  • 41.0%
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SLIDE 23

Precious Shipping PCL Source: CRS - PSL

Dry Bulk Fleet - New Buildings Projected vs Delivered 2009

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5.36 18.8 34.89 8.34 3.88 7.26 22.81 2.34 2.81 9.81 5.40 68.5 18.12 26.03 10.73 39.69% 61.29% 47.82% 35.25% 34.62%

10 20 30 40 50 60 70 80

H a n d y s i z e H a n d y M a x S u p r a m a x P a n a m a x C a p e s i z e

DWT ( million MT) 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% Projected at Start of Year (2009) Actual Delivered (2009) New Bulidings 2010 Slippage (2009)

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SLIDE 24

Precious Shipping PCL Source: CRS - PSL

Confirmed Orders as of 01 Jan 2010, all ships (to 2013)

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5.36 2.29 0.61 0.06 10.73 8.12 3.83 0.27 26.03 15.51 4.97 0.51 18.12 14.99 7.22 2.12 68.50 49.55 28.19 7.46

0.00 10.00 20.00 30.00 40.00 50.00 60.00 70.00 DWT m MT Small Handy Handymax Super Handymax Panamax Capesize 2010 2011 2012 2013

Total Confirmed Orders: 2010: 128.74 m DWT 2011: 90.46 m DWT 2012: 44.82 m DWT 2013: 10.42 m DWT

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SLIDE 25

Precious Shipping PCL

Years 2010 & 2011 – Expect the Expected

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  • Dry Bulk Ship Supply in DWT terms at beginning of year:
  • 01 Jan 2008  411.9 m DWT  +6.3% increase
  • 01 Jan 2009  438.2 m DWT  +6.4% increase
  • 01 Jan 2010  478.7 m DWT  +9.2% increase
  • 01 Jan 2011  607.4 m DWT  +26.9% (basis 100% deliveries of ships on order)
  • 01 Jan 2011  543.0 m DWT  +13.4% (basis 50% slippage of ship deliveries)
  • Assuming 50% slippage supply is still a whopping 64.3 m DWT or 13.4% increase during

2010.

  • Scrapping: if the market were to collapse, scrapping could be as high as 10 to 15m DWT

per annum. Even with this assumption and a 50% slippage the new supply would still show a double digit %age increase during 2010.

  • 2010 demand for steel as per the World Steel Association is expected to be similar to 2008.
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SLIDE 26

Precious Shipping PCL

Conclusions on the Supply Demand Equation

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  • China’s insatiable appetite for commodities will continue fuelled by their Stimulus Plan,

Urbanisation and Infrastructure –2010 Iron Ore imports could reach ~ 675 MMT!!

  • India will also be a big player in the Urbanisation and Infrastructure area.
  • The Middle East will continue their Urbanisation and Infrastructure development

currently running at USD 2.4 Trillion just in the GCC!

  • Iron Ore, Coal and Steel will remain the dominant force behind the Commodity cycle.
  • The supply side especially in the Cape size sector looks daunting but when combined with

the Panamax sector is not as frightening.

  • The Credit crunch will help slow down this flood of new ships reaching the market by

aborting expansion plans at some of the shipyards.

  • Hopefully all the ships in the Greenfield shipyards will fail to be built.
  • The demographics of the existing supply of ships will act as a safety valve when the new

buildings start coming on stream in full force.

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SLIDE 27

Precious Shipping PCL

PSL’s Strategy

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SLIDE 28

Precious Shipping PCL

Actions Taken at PSL

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  • Sold 25 older ships since start of 2009 at decent Capital Gains.
  • Purchased 2 replacement ships so far (Rosella 29,870 DWT built Japan 2005 in December

2009 and Ocean Twins 31,700 DWT built Japan 2005 in February 2010). Another 23 still to be purchased.

  • Cash available at the end of 2009 was $176m after paying regular quarterly dividends.
  • Extended availability period of existing $250m credit facility to buy 2nd hand ships to end of

2010.

  • Signed a brand new credit facility for $250m to buy 2nd hand ships valid till end June 2011.
  • Signed contracts for 3 firm, 1 option, Cement Carriers for minimum 15 years (extendable

at Clients option to 20 – 25 years) each at USD 15,000 per day per ship.

  • Continuing to fix ships on longer term contracts as and when opportunities arise.
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SLIDE 29

Precious Shipping PCL

The Seven Deadly Sins or Shipping Risks and Opportunities

1. Do not buy any assets during peak years (PSL did not make any significant purchase in the last 5 years) 2. Sell older ships and en-cash capital gains on a regular basis (10 ships sold in 2007, 21 Ships sold in 2009 and 4 Ships in 2010. Thus total disposal target of 25 ships is accomplished) 3. Do not speculate whether it be by chartering ships in or by buying FFAs or by taking bunker hedges (PSL does not undertake any of these activities) 4. Fix Ships on Long Term Time Charter when markets are high and achieve a 50% forward cover on a rolling 4 year basis (Being done on an ongoing basis) 5. Deleverage your Balance Sheet when times are good (PSL prepaid 9 year loan of USD 265 million taken in 2003/4 in just 2 years out of cash flow generated from PSL fleet) 6. Reduce dividends to the minimum level when you have debt in your balance sheet (PSL paid

  • ut the minimum levels of dividend during 2004/2005 when PSL’s debt was at its peak)

7. Acquire additional ships from the second-hand markets to replace your oldest ships only when opportunities present themselves when the BDI has collapsed (Two bought so far, Rojarek Naree and Nalinee Naree, another 23 still to go)

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SLIDE 30

Precious Shipping PCL

Rolling 4 Year Forward Book (As of 31st Dec 2009)

3,929 9,843 3,984 3,727 5,651 25.98% 30.01% 62.87% 82.25% 34.47% 15,781 14,397 15,868 11,829 15,021 15,336 13,093 10,811 8,988 11,968 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 2009 2010 2011 2012 2013 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 100.00% Fixed T/C days %age Fixed T/C rate Total Days

Contract value USD 141.7 m USD 66.8 m USD 56.0m USD 62.0 m USD 63.2 m

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SLIDE 31

Precious Shipping PCL

Our New Building Program

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  • 18 ships are on order – 12 X 34K ($30m each) + 6 X 54K ($38m each) – all double hulled
  • Delivery: Three 34K ships per year (2010 to 2013), Three 54K per year (2011 and 2012)
  • Total value of the New Building contract is USD 588 million
  • We have already paid out USD 117.6 million from our Internal Resources
  • We have a confirmed credit line for USD 398.4 million at 120 bps over LIBOR which leaves

USD 72 million still unfunded covering 80% of the value of the three 34K ships due in 2013

  • The first six 34K ships have been fixed for min 83 max 87 months each with an EBITDA of

between USD 26 and 28 million per ship per contract!

  • The first 54K ship has been fixed for min 60 max 64 months with an EBITDA of between

USD 39 and 42 million for the contract.

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SLIDE 32

Precious Shipping PCL

New Buildings - terms of funding

32

FACILITY: Secured Term Loan Facility of up to USD 398.40 million (80% of Construction Price).

  • Pre-Delivery Facility: As per milestones in the shipbuilding contracts.
  • Post-Delivery Facility: 100% of the Post-Delivery Facility Amount is to be drawn upon delivery of the

respective vessels.

FINAL MATURITY: 10 years from the delivery drawdown of the first Vessel, and accordingly, Final

Maturity is expected to be in March 2020.

REPAYMENT: Each Tranche shall be amortized (repaid) as quarterly repayment installments

amounting to 1/60th of the Post-Delivery Facility Amount and a balloon equal to the balance under such Tranche on Final Maturity. The first quarterly repayment shall commence 3 months after delivery of each respective vessel. At Final Maturity, all amounts outstanding shall be repaid and the respective Tranches reduced to Zero.

MARGIN: 1.20% per annum. INTEREST PERIOD: 3 months. COMMITMENT FEE: 0.35% per annum of undrawn amount of the aggregate facility amount. LISTING: PSL to remain listed on the Stock Exchange of Thailand during the period of the Facility.

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SLIDE 33

Precious Shipping PCL

New Buildings - Milestones, Payment terms and funding

Ins. No. Occasion Source 2007 2008 2009 2010 2011 2012 2013 Total 1st Signing the contract (20%) Internal cash Flow 94,799,985 22,799,997 117,599,982 2nd Steel cutting for the ship (20%) Bank loan 21,199,997 54,399,992 23,999,996 17,999,997 117,599,982 3rd Keel Laying of the Ship (20%) Bank loan 31,599,996 61,999,996 17,999,997 5,999,999 117,599,988 4th Launching of the Ship (20%) Bank loan 25,600,000 33,200,000 40,800,000 18,000,000 117,600,000 5th Delivery of the Ship (20%) Bank loan 19,600,000 39,200,000 40,800,000 18,000,000 117,600,000 Total 94,799,985 43,999,994 85,999,988 131,199,992 108,399,994 87,599,999 36,000,000 587,999,952

33 Year 2007-2009 Figures are Actual Year 2010-2013 Figures are Estimated

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SLIDE 34

Precious Shipping PCL

Financials

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SLIDE 35

Precious Shipping PCL

FINANCIAL HIGHLIGHTS – INCOME STATEMENT

35

Particulars 2009 2008 Total Revenues - US$ Million 184.95 258.60 Gross Profit - US$ Million 110.14 199.01 Net Income - US$ Million 88.09 148.14 Gain on sale of Fixed Assets -US$ Million (Per Sha 22.87 (0.02) 0.00 (0.00) EBITDA - US$ Million (Avg per Ship) 86.04 (2.62) 167.10 (3.79) Average TC Income per Ship per day 13,459 16,489 Average Ship Running Cost per Ship per day (Ope 5,040 4,804 Operating days ( Average Number of Ships) 11,967 (32.79) 16,104 (44.12) Earnings per share (Baht) 2.93 4.75 Dividend declared for the year per share (Baht) 1.20 2.80 Cash Dividend paid out per share (Baht) 2.00 2.75 Gross Profit Margin (%) 69.02 77.43 Net Profit Margin (%) 47.63 57.29

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SLIDE 36

Precious Shipping PCL

FINANCIAL HIGHLIGHTS – FINANCIAL POSITION

36

Particulars 2009 2008 Total Current Assets - US$ Million 181.93 104.52 Fixed Assets Net - US$ Million 221.21 256.41 Total Assets - US$ Million 644.58 514.37 Total Current Liablities - US$ Million 14.59 22.17 Total Long-Term Loans - US$ Million 128.08 21.07 Total Liabilities - US$ Million 149.13 50.82 Total Shareholders’ Equity - US$ Million 495.44 463.55 Book Value per share (US$) 0.48 0.45 Return on Equity (%) 18.37 34.28 Return on Total Assets (%) 15.20 31.41 Total Liabilities/Equity Ratio 0.30 0.11 Number of Ships (As At End of The Year) 25.00 44.00

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SLIDE 37

Precious Shipping PCL

FINANCIAL HIGHLIGHTS – CASH FLOW

37

2009 2008 Income before Corporate Income Tax 89.78 148.73 Depreciation and Amortisation 26.96 30.65 Gain on sale of Fixed Assets (22.87) 0.00 Cash flow from Operating activities 75.95 184.37 Cash paid for advances for Vessel Constructi (86.27) (44.16) Proceeds from sales of Vessels and equipme 68.57 0.00 Cash flow from (used in) Investing activities (47.60) (62.26) Cash received from Long Term Loans 108.15 21.20 Dividend paid (60.36) (85.45) Cash flow from (used in) Financing activities 47.70 (66.90) Cash and Cash equivalents at the begining of 96.25 43.69 Cash and Cash equivalents at the end of the y 176.06 96.25 USD Million Particulars

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SLIDE 38

Precious Shipping PCL

Operating Expenses

  • These are the fixed costs required to run a ship and are evenly spread over the entire year of 365 days
  • PSL’s Opex per day per ship for 2009 was USD 5,040 and Year 2008 was USD 4,804 broken up into:

2008 2009

Item USD % USD % Crew costs(Abt 26 people /ship) 1,622 33.76% 1,709 33.91% Manning Expenses 224 4.66% 229 4.54% Victualling 184 3.83% 179 3.55% Lub oils 279 5.81% 304 6.03% Insurance 417 8.68% 521 10.34% Repairs/Maintenance 119 2.48% 129 2.56% Stores/Spares 523 10.89% 423 8.39% Drydocks/Special Surveys 1,019 21.21% 1,029 20.42% Management Expenses 367 7.64% 447 8.87% Misc expenses 50 1.04% 70 1.39% Total 4,804 100.00% 5,040 100.00%

38

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SLIDE 39

Precious Shipping PCL

Operating Expenses Comparison

  • OPEX Comparison with Industry compiled by Moore Stephens & Co.
  • OPEX excluding dry dock and special survey cost

Industry PSL Industry PSL Industry PSL PSL For years 2006 2006 2007 2007 2008 2008 2009 Particulars US$ (Per Day) US$ (Per Day) US$ (Per Day) US$ (Per Day) US$ (Per Day) US$ (Per Day) US$ (Per Day) Crew Wages 1,331 1,264 1,382 1,318 1,768 1,622 1,709 Provisions 149 152 153 167 169 184 179 Crew Other 222 161 247 218 287 224 229 Crew Cost Total 1,702 1,577 1,782 1,703 2,224 2,030 2,117 Lubricants 259 238 313 301 334 279 304 Stores Other 307 242 320 232 377 260 196 Stores Total 566 480 633 533 711 539 500 Spares 330 214 353 210 422 263 227 Repairs & Maintenance 293 117 346 111 410 119 129 Repairs & Maintenance Total 623 331 699 321 832 382 356 P & I Insurance 215 155 259 153 290 188 340 Insurance 244 163 247 286 290 229 181 Insurance Total 459 318 506 439 580 417 521 Registration Costs 28 28 36 Management Fees 380 143 447 187 559 367 447 Sundries 181 58 166 43 197 50 70 Administration Total 589 201 641 230 792 417 517 Total Operating Costs $3,939 $2,907 $4,261 $3,226 $5,139 $3,785 $4,011

39

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SLIDE 40

Precious Shipping PCL

AVERAGE OPEX / TC RATES (1995 - 2009)

4,804 5,040 3,060 3,118 2,889 2,556 2,590 2,648 2,589 2,604 2,670 2,810 3,055 3,622 4,005 13,459 16,489 7,306 6,661 5,742 4,834 4,808 5,760 5,855 5,854 7,870 13,248 14,449 11,387 13,147 25,243 25,688 25,330 25,330 25,213 23,061 22,855 22,700 22,014 21,225 21,225 20,888 20,193 19,514 25,688 5000 10000 15000 20000 25000 30000 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09

Opex(USD) TC Rate(USD) Av Size (DWT)

Year 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Avg Age 15.97 16.18 14.24 14.59 15.59 15.57 15.65 15.82 16.60 17.35 18.98 19.98 19.59 20.59 17.08

40

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SLIDE 41

Precious Shipping PCL

Dividend policy: not less than 25% of net profit Actual Dividend Paid Out

0.80 0.60 0.25 0.50 0.75 1.00 1.50 2.00 1.20 0.38 0.78 0.78 1.56 0.75 61.4% 59.0% 42.3% 27.5% 25.0% 69.7% 56.1%

0.5 1 1.5 2 2.5 2003 2004 2005 2006* 2007 2008 2009** Year dividends Baht

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% dividends as % of EPS

Interim Dividends Final Dividends As % of EPS 41

  • *2006 Final Dividend includes 1:1 bonus share at par
  • **2009 Final Dividend subject to shareholder’s approval
  • All dividends shown adjusted for 1:1 bonus shares at par
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SLIDE 42

Precious Shipping PCL

FUNDED DEBT & DEBT/EQUITY RATIO

44.16 21.07 128.08 240.41 256.58 156.69 105.71 86.12 185 45.28 110.38 132.93 211.28 226.9 226.05 30.97 0.26 0.05 1.31 1.48 3.02 2.92 0.56 0.56 2.52 2.40 3.79 1.20 0.90 1.13 0.28 0.00 0.00

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 93 94 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 Year Ratio 50 100 150 200 250 300 Debt ( Million USD) Debt(Million USD) Debt/Equity Ratio 42 Maximum outstanding during the year

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Precious Shipping PCL

FUNDED DEBT / EBITDA

1.49 0.13 0.00 0.00 0.40 1.25 6.40 6.51 5.86 4.33 4.73 3.63 3.32 3.29 1.85 0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 Year Ratio 43

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SLIDE 44

Precious Shipping PCL

88.09 1 48.1 4 20.88 1 54.22 92.63 1 25.1 3 1 1 0.1 1 1 .43 1 4.48

  • 1

5.26 6.41

  • 6.35

1 .26 6.62

  • 0.47

24.78 1 02.32 1 44.59 1 96.31 1 34.78 37.22 36.43 7.48 31 .33 1 9.31 25.26 27.64 1 7.83 1 62.88 22.49 42.01 1 63.1 6 33 52 54 54 29 35 38 45 41 41 35 31 28 30 45 44

  • 50

50 100 150 200 250 94 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09

Million USD

10 20 30 40 50 60 Net Profit/(loss) Cash Profit(NP+Depn) Av No of Vsl

Net Profit / Cash Profit

44

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SLIDE 45

Precious Shipping PCL

Cash Operating Profit/ Operating Profit

102.15 164.09 134.66 196.44 40.10 23.60 26.19 25.05 13.00 14.91 25.67 36.07 22.49 37.22 144.57 162.43 87.92 149.06 110.07 22.87 5.30 5.17 1.05

  • 12.66
  • 10.01

2.93 14.12 20.88 11.43 154.35 124.68 92.51

  • 50

50 100 150 200 250 94 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09

Million USD

Cash Op P&L(EBITDA-Interest) Op P&L(EBITDA-Interest-Depreciation)

45

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SLIDE 46

Precious Shipping PCL

FINANCIAL PROFILE PRE / POST 1997 ASIAN FINANCIAL CRISIS

High (Year) Low (Year) 2009 Funded Debt $256.6m (1997) $185m (1999) $128.08m Equity $94.4m (1996) $61.3m (1999) $495.44m Funded Debt/Equity 3.79 (1997) 2.40 (1996) 0.26 EBITDA $52.4m (1996) $28.9m (1999) $86.04m Debt/EBITDA 6.5 (1998) 4.33 (1996) 1.49 Daily Earnings $7,306 (1995) $4,808 (1999) $13,459 Daily Opex $3,118 (1996) $2,556 (1998) $5,040 Total Assets $367.0m (1996) $270.6m (1999) $644.58m Net Profit (Loss) $20.9m (1995) $(15.3m) (1997) $88.09m Total Revenues $127.21 (1996) $96.53m (1995) $184.95m 46

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SLIDE 47

Precious Shipping PCL

Awards and Achievements

47

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SLIDE 48

Precious Shipping PCL

Corporate Governance

48

  • Good Corporate Governance is a must – treat everyone equally and fairly. CLSA ranked PSL as second best

company in Thailand for Corporate Governance for 2008.

  • Transparency with good flow of information is vital for Investor confidence. Be consistent with the quality and

timeliness of your information release.

  • Avoid Financial Engineering of your balance sheet so that even the least savvy investor can understand the

financial health and well being of your company.

  • Stick to your business model. If you are a shipping company then that’s what you should be doing. And in that

space stick to what you know best.

  • Do not speculate in any fashion or at all. If investors wished to speculate they would go to the casino and not

hand you their money to run a shipping company.

  • Asiamoney voted PSL as having the Best Executive and Best Investor Relations Officer in Thailand for 2008.
  • Asiamoney voted PSL as Best Overall for Corporate Governance, Best for Disclosure and Transparency and

Best for Investor Relations for 2009 in Thailand.

  • The Securities Analysts Association of Thailand voted PSL as having the Best CEO in the small mid cap

companies category for 2009.

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SLIDE 49

Precious Shipping PCL

Industry Awards and Honors

49

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SLIDE 50

Precious Shipping PCL

Marine Money Ranking: Methodology

Source Marine Money

Methodology: Simple Average of Performance Ranks Performance Ranks:

Total Return to Shareholders (TRS) (Change in Share Price + Dividend)/ (Share Price at the beginning of Period) Assets Turnover Sales / Total Assets Profit Margin EBITDA / Sales Return on Equity(ROE) Net Income / Average Shareholders Equity Return on Assets(ROA) EBIT / Average Total Assets Price / Book Value Market Value of Equity / Book Value of Equity

50

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Precious Shipping PCL

Marine Money International Rankings 2006-2008

Particulars 1st Rank Ratio 2006 PSLRank 2006 PSL Ratio 2006 1st Rank 2007 PSL Rank 2007 PSL Ratio 2007 1st Rank 2008 PSL Rank 2008 PSL Ratio 2008 1st Rank PSL Courage Marine 14 Frontline LTD 7 Total Return to Shareholders (TRS) 235.07% 1 235.07% 16 45 30.14% 7 35

  • 50.81%

Turnover Rate 3.60 28 0.66 27 41 0.49 39 43 0.48 Profit Margin 75.71% 13 64.55% 19 18 65.44% 39 16 70.89% Return on Equity (ROE) 77.18% 14 29.68% 9 21 31.84% 3 23 32.65% Return on Assets (ROA) 32.39% 2 26.19% 1 6 21.20% 16 1 30.13% Price / Book Value 107.61 17 2.21 32 41 2.14 1 48 0.70 Total 75 104 172 105 166

Source: Marine Money

51

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SLIDE 52

Precious Shipping PCL

Shareholder’s returns

52

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SLIDE 53

Precious Shipping PCL

SHAREHOLDER SCORECARD-Bangkok Post 18th May 2007

53

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SLIDE 54

Precious Shipping PCL

Total Return to Shareholders: 1993 to 2009

54

  • 85

4 6 9 6 25 51 90 48 112

  • 10

61 82.2

  • 85
  • 81
  • 75
  • 85
  • 76
  • 70
  • 45

6 149.2 239.2 383.2 67 351.2

  • 200
  • 100

100 200 300 400 500

IPO 1993 Dividend 1994 Dividend 1 For 1 Right(1995) 1995 Dividend 1996 Dividend 2003 Dividend 2004 Dividend 2005 Dividend 2006 Dividend ( and 1for 1 bonus) 2007 Dividend 2008 Dividend 2009 Dividend

Baht 5 10 15 20 25 30 35 40 No of shares

Inflow/Outflow Net Cash Position before sale of investment No of Shares held

1 IPO share value after 16 years @ 18.80 B / share (as of 30th Dec 2009) adjusted for rights , splits and bonus = 752 Baht Total net Cash position = Baht 1,183.20, Returns = 13.92 times

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SLIDE 55

Precious Shipping PCL

Thank You!

A PRECIOUS SHIPPING PRESENTATION

55

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SLIDE 56

Precious Shipping PCL

56

Source : CRS/Aries

Small Handy - New Buildings Projected vs Delivered DWT

1.48 0.94 1.11 0.82 1.27 1.06 1.29 1.00 1.67 1.09 2.17 1.53 2.29 1.89 3.88 2.34

0.5 1 1.5 2 2.5 3 3.5 4 DWT m MT 2002 2003 2004 2005 2006 2007 2008 2009 Year

Projected Delivered

%age Average slippage 2002-2007: -27.6% %age Slippage for 2008:

  • 17.5%

%age Slippage for 2009:

  • 39.7%
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SLIDE 57

Precious Shipping PCL

57

Source : CRS/Aries

Handymax - New Buildings Projected vs Delivered DWT

0.88 0.65 1.02 0.73 1.32 1.07 1.6 1.14 1.19 0.55 1.2 1.00 2.27 1.37 7.26 2.81

1 2 3 4 5 6 7 8 DWT m MT 2002 2003 2004 2005 2006 2007 2008 2009 Year

Projected Delivered

%age Average slippage 2002-2007: -28.8% %age Slippage for 2008:

  • 39.6%

%age Slippage for 2009:

  • 61.3%
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SLIDE 58

Precious Shipping PCL

58

Source : CRS/Aries

Supramax - New Buildings Projected vs Delivered DWT

5.1 4.18 3.91 3.39 4.27 4.52 5.68 4.79 5.71 3.68 5.76 4.94 8.65 6.35 18.8 9.81

2 4 6 8 10 12 14 16 18 20 DWT m MT 2002 2003 2004 2005 2006 2007 2008 2009 Year

Projected Delivered

%age Average slippage 2002-2007: -15.2% %age Slippage for 2008:

  • 26.6%

%age Slippage for 2009:

  • 47.8%
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SLIDE 59

Precious Shipping PCL

59

Source : CRS/Aries

Panamax - New Buildings Projected vs Delivered DWT

4.77 4.05 2.24 1.37 5.44 5.75 5.58 5.96 9.23 6.67 8.83 6.60 8.95 5.65 8.34 5.40

1 2 3 4 5 6 7 8 9 10

DWT m MT

2002 2003 2004 2005 2006 2007 2008 2009

Year

Projected Delivered

%age Average slippage 2002-2007: -15.7% %age Slippage for 2008:

  • 36.9%

%age Slippage for 2009:

  • 35.3%
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SLIDE 60

Precious Shipping PCL

60

Source : CRS/Aries

Cape Size - New Buildings Projected vs Delivered DWT

4.4 3.98 4.76 5.38 6.65 7.96 8.49 7.67 8.71 9.02 9.96 10.03 9.35 8.89 34.89 22.81

5 10 15 20 25 30 35 DWT m MT 2002 2003 2004 2005 2006 2007 2008 2009 Year

Projected Delivered

%age Average slippage 2002-2007: +3.0% %age Slippage for 2008:

  • 4.9%

%age Slippage for 2009:

  • 34.6%