Presentation at Pareto Oil & Offshore Conference September 12 th - - PowerPoint PPT Presentation

presentation at pareto oil offshore conference
SMART_READER_LITE
LIVE PREVIEW

Presentation at Pareto Oil & Offshore Conference September 12 th - - PowerPoint PPT Presentation

Hegh LNG - the FSRU provider Presentation at Pareto Oil & Offshore Conference September 12 th , 2018 Sveinung J.S. Sthle President & CEO 1 Forward looking statements This presentation contains forward- looking statements which


slide-1
SLIDE 1

Höegh LNG - the FSRU provider

1

Presentation at Pareto Oil & Offshore Conference

September 12th, 2018

Sveinung J.S. Støhle President & CEO

slide-2
SLIDE 2

Forward looking statements

2

This presentation contains forward-looking statements which reflects management’s current expectations, estimates and projections about Höegh LNG’s

  • perations. All statements, other than statements of historical facts, that address activities and events that will, should, could or may occur in the future are

forward-looking statements. Words such as “may,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “intend,” “forecast,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue” or the negative of these terms and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. Unless legally required, Höegh LNG undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: changes in LNG transportation and regasification market trends; changes in the supply and demand for LNG; changes in trading patterns; changes in applicable maintenance and regulatory standards; political events affecting production and consumption of LNG and Höegh LNG’s ability to operate and control its vessels; change in the financial stability of clients of the Company; Höegh LNG’s ability to win upcoming tenders and securing employment for the FSRUs on order; changes in Höegh LNG’s ability to convert LNG carriers to FSRUs including the cost and time of completing such conversions; changes in Höegh LNG’s ability to complete and deliver projects awarded; changes to the Company’s cost base; changes in the availability of vessels to purchase; failure by yards to comply with delivery schedules; changes to vessels’ useful lives; changes in the ability of Höegh LNG to obtain additional financing, including the impact from changes in financial markets; changes in the ability to achieve commercial success for the projects being developed by the Company; changes in applicable regulations and laws; and unpredictable or unknown factors herein also could have material adverse effects on forward-looking statements.

slide-3
SLIDE 3

Agenda

3

▪ Company background ▪ Recent milestones ▪ Market update ▪ Financial update ▪ Summary

slide-4
SLIDE 4

HMLP common equity HMLP-A preferred HLNG NO HLNG02 / HLNG03 bond loans

Höegh LNG is the leading owner and operator of FSRUs

4

▪ Largest, most modern and most efficient Floating Storage and Regasification Unit (FSRU) fleet in the market ▪ Solid backlog with credible counterparts ▪ Actively pursuing backlog extension through on- going tender processes ▪ Market cap / EV: USD 450m / USD 1.6bn ▪ Assets / equity ratio*: USD 2.1bn / 37% ▪ Revenues / EBITDA**: USD ~300m / USD ~160m ▪ Employees: 125 onshore / 525 offshore

8.7 years

  • Avg. remaining contract length

USD 3.2 bn

Revenue backlog

* 30 June 2018 ** H1 2018 annualised

8 FSRUs in operation 2 FSRUs under construction 2 LNGCs in operation

slide-5
SLIDE 5

The fleet at work - Global presence serving credible counterparts

5

Cape Ann PGN FSRU Lampung Neptune Independence Höegh Grace Höegh Giant Arctic Princess Arctic Lady Höegh Gallant FSRU intermediate trading LNG carrier FSRU Höegh Esperanza

slide-6
SLIDE 6

Recent milestones

6

▪ Debt financing secured for FSRU #9 ▪ Debt financing secured for FSRU #10

Financing Operational Commercial

▪ Höegh Esperanza delivered with no LTIs ▪ 100% technical availability across the fleet in 2018 ▪ Excellent HSEQ statistics - Zero LTIs last 12 months ▪ 3-year TC for Höegh Esperanza with CNOOC ▪ 15 month interim TCP for FSRU #9 with Naturgy ▪ Progress made on several tendering processes

slide-7
SLIDE 7

Natural gas’ share of the global energy mix increasing, enabled by LNG

7

▪ Transition to a lower carbon fuel mix set to continue ▪ Natural gas expected to overtake

  • il and coal as the primary fossil

fuel with an annual average demand growth of 1.6% ▪ Expanding LNG supply, paired with new regasification infrastructure, is providing access in-demand natural gas across global markets

Source: BP Energy Outlook 2018

Primary energy consumption Shares of primary energy

slide-8
SLIDE 8

Prospective LNG importers choosing FSRUs as the tool for accessing LNG markets

8

100 200 300 400 500 600 700 800 900 2000 2005 2010 2015 2020 2025 2030 2035 2040

mtpa

World LNG supply and demand

JKT Europe China India Other Asia MENA S America RoW LNG Capacity

Source: IHS Markit

FSRU opportunities in Asia

China: 1st FSRU in place, contemplating more India: 1st FSRU to be installed Q4 2018, several contemplated Bangladesh: FSRU in place, contemplating more Thailand: Contemplating FSRU Pakistan: 2x FSRUs installed, contemplating more Indonesia: 2x FSRUs installed Vietnam: Contemplating FSRU Myanmar: Contemplating FSRU Other (Australia, Hong Kong, Sri Lanka, Philippines): All contemplating FSRUs

slide-9
SLIDE 9

Large number of market opportunities backed by diverse drivers of demand

Region Existing Under way Proposed N America 1 2 S America 6 2 3 Europe 4 1 4 MENA 6 5 Sub-Sahara Africa 1 4 South Asia 4 3 5 Asia/Oceania 4 2 7 Sum 24 10 30 +

9

Enabler Security of supply Seasonal demand Back-up for hydro Balance of trade New gas-fired generation Demand drivers Increasing supply of attractively priced LNG Transportation Replacement for coal and oil Existing and potential FSRU contracts

Source: IHS Markit

slide-10
SLIDE 10

FSRU supply well matched against the number of demand-side prospects

10

▪ Recent newbuilding contracting:

 BW LNGC-to-FSRU conversion  Maran Gas: 1x FSRU ordered, 1x FSRU order cancelled (LNGC)  Botas 1x FSRU for own project

▪ Single-purpose FSRUs are intended for a pre-determined project, rather than participation in competitive tenders

8 8 5 2 1 2 1 1 2 1 2 4 6 8 10 12 Höegh LNG Excelerate Golar LNG BW Gas Other Single-purpose Units

FSRU fleet and orderbook1 by owner/employment

Committed Available Committed NB Uncommitted NB

MOL Exmar Maran Dynagas Dynagas Gazprom Kol/Kal SWAN Java-1 OLT Botas

slide-11
SLIDE 11

Built EBITDA Charterer USDm/yr Höegh LNG Holdings

Arctic Princess* 2006 19** Equinor Arctic Lady* 2006 19** Total Independence 2014 47 KN Höegh Giant 2017 Naturgy / Tendering Höegh Esperanza 2018 CNOOC / Tendering FSRU#9 2018 Naturgy / Tendering FSRU#10 2019 Tendering Höegh LNG Partners Neptune 2009 33** Total GDF Suez Cape Ann 2010 33** Total PGN FSRU Lampung 2014 40 PGN Höegh Gallant 2014 38 Egas Höegh Grace 2016 42 SPEC

Long-term contract LNGC interim trading Extension option Under construction FSRU and/or LNGC intermediate charter

2019 2021 2023 2025 2027 2029 2031 2020 2022 2036 2038 2024 2026 2028 2030 2032 2033 2035 2037 2034

Modern fleet marketed in active tendering market

11 * LNG carriers ** 100% basis, units are jointly owned

Delivery November 2018 Delivery May 2019

slide-12
SLIDE 12

Höegh LNG is fully financed at attractive terms

12

Höegh Esperanza FSRU #9 FSRU #10 Delivery April 2018 November 2018 May 2019 Structure Export credit and commercial debt Export credit and commercial debt Sale and leaseback Leverage (% of delivered cost) 65-75% 65% 70-80% Amortisation profile 16-18 years 16 years 20 years Tenor 12 / 5 years 12 / 5 years 12 years Fixed interest rate ~4% ~5% ~6% ▪ With commitments received for the financing of FSRU #10, Höegh LNG is fully equity and debt financed ▪ Lending group consisting of leading international banks and credit institutions

slide-13
SLIDE 13

Solid balance sheet and robust liquidity situation

13

FSRUs, 1,837

Other, 85

Cash & eq., 195 Interest-bearing debt, 1,003 Bonds, 314

Other, 17

Equity, 782 500 1,000 1,500 2,000 2,500 Assets Liabilities USDm

Group balance sheet1 at 30 June 2018

1) Adjusted for mark-to-market of hedging reserves

Available liquidity at 30 June 2018 USDm

Cash, net of HMLP 117 Marketable securities 50 Revolving credit facility 45 Debt for FSRU #9 177 Debt for FSRU #10 180 Available liquidity 569 Increased leverage on Höegh Giant / Höegh Esperanza / FSRU #10 85 Targeted available liquidity 654 Outstanding capital expenditures, 30 June 380 - 400

slide-14
SLIDE 14

Earnings growth – Higher contribution expected from Höegh Esperanza and Höegh Giant in H2 2018

▪ Q2 2018 earnings reflecting full technical and commercial uptime ▪ H2 2018 earnings expected to reach higher

 Höegh Giant on index-linked LNGC contract producing higher revenues  Höegh Esperanza starting FSRU/LNGC contract in June

14

10 20 30 40 50 60 70 80 1q14 2q14 3q14 4q14 1q15 2q15 3q15 4q15 1q16 2q16 3q16 4q16 1q17 2q17 3q17 4q17 1q18 2q18

USD million

Total income

  • 10

10 20 30 40 50 1q14 2q14 3q14 4q14 1q15 2q15 3q15 4q15 1q16 2q16 3q16 4q16 1q17 2q17 3q17 4q17 1q18 2q18

USD million

EBITDA

slide-15
SLIDE 15

Höegh LNG – Investment summary

15

Order backlog of USD 3.2 Bn with credible counterparties producing stable cash flows Consistent and solid operational performance across the global fleet Strong financial platform with diversified financing sources Rapid growth in the supply of LNG driving FSRU demand FSRUs under construction marketed in positive tender market

slide-16
SLIDE 16

16

Questions?