Presentation on Half Year Results 2007 June 20, 2007
Content Financial Overview 2nd Quarter 1 2 Versacold / Atlas 3 Global Strategy 4 Cash flow, balance sheet and neb debt ratio 5 Innovate
Financial Overview 2nd Quarter
Highlights • Many acquisitions and integrations in the end of the financial year 2006 and first half of the financial year 2007 – Corby Chilled, merged into Innovate – Containerships, Kursiu Linija merged into Containerships – Atlas Cold Storage – Daalimpex • Sales of assets and reduce debts in the Balance sheet prior to year end – Disposal of Aviation related assets – Sales of properties related to Atlas and Versacold if the deal will be succesfull • Merger of Hf. Eimskipafelag Islands and Eimskipafelag Islands ehf. as of November 1 2006
2nd Quarter Results compared to forecasts Kaup þ ing Euro Millions Glitnir Landsbanki Actual Total Revenue 340 342 410 397 EBITDA 36,1 32,6 35 33 EBIT 14,6 11,6 13 10,5 PROFIT 0,6 -3,3 -2,5 0,2
Consolidated Income Statement H1 2007 Actual Actual Dff. EUR '000 2007 2006 2006 Operating revenue 796.419 376.544 419.875 Operating expenses (757.866) (358.268) (399.598) Gross profit 38.553 18.276 20.277 Administration (17.242) (16.734) (508) EBIT 21.311 1.542 19.769 Financial income and expenses (32.332) (41.773) 9.441 Influence of affiliated companies 899 214 685 Profit before taxes (10.122) (40.018) 29.896 Income tax 4.740 4.942 (202) Profit (loss) for continuing operations (5.382) (35.075) 29.693 Profit (loss) from discontinued operations (net of tax) 0 (24.613) 24.613 Profit (loss) for the period (5.382) (59.688) 54.306 EBITDA......................................................................... 65.465 31.769 EBITDA / Income.......................................................... 8,2% 8,4% EBIT / Income............................................................... 2,7% 0,4% Profit / Income............................................................... -0,7% -9,3%
Business segments: Eimskip and Aviation H1 2007 Euro Millions Total Eimskip Aviation Operating Revenue 796 637 160 Operating Expenses 758 588 170 EBITDA 65 60 5
EBITDA Trend EUR '000 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Revenue 172.950 180.829 282.603 399.323 397.096 Expenses (164.336) (166.263) (277.042) (367.034) (363.920) EBITDA 8.614 14.566 5.561 32.289 33.176 450 35 400 30 350 25 300 Euro Millions 20 250 200 15 150 10 100 5 50 0 0 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007
Key Financials 2007 - 2010 • Eimskip ’ s turnover will exceed two billion Euros in 2010 • Eimskip ’ s projected turnover for the year 2007 was 1,150 million Euros 2.500 250 2.000 200 Euro Millions 1.500 150 1.000 100 500 50 0 0 2007 2008 2009 2010 Total Revenue Total EBITDA
Global Strategy
Our activities over last three years 4 projects in process today: • Versacold take-over bid • Disposal of Avion Aircraft Trading • Disposal of Air Atlanta • Sales-leaseback in Atlas
Business Snapshot • Approximately 10,000 employees (14,500 with Versacold) • 200 operational bases in 31 countries (280 with Versacold) • 40-50 vessels • 30.000 teus – container units • Around 100 coldstores (180 with Versacold) • 1,350 trucks and trailers • 25 aircraft Complete transport services – Door to Door Domestic Domestic International Plant/ware- Empty Export port Import port Plant/ware- Empty transport to transport transport house container house container port from port
Eimskip's contribution 1. Staff 4. Global coverage 2. Hardware 3. Vertical integration
Vertical integration Eimskip involved in all pars except Harvesting/production and retail
Vertical integration Partnerships Coldstores with deep sea Shipping Carriers Intra Us & CA Forwarding ERL Asia DL DSC shipping & Eimskip Reefer Coldstores Logistics espertise Distribution High added Value Reduced transaction costs through services to the elimination of non value adding customers intermediaries
Corporate Structure CEO/President Baldur Orn Gudnason Executive Board Executive Board of Directors of Directors Corporate Office Stefan Agust Magnusson Deputy CEO Finance Finance Logistic Logistic Stefan Agust Magnusson Stefan Agust Magnusson & PD & PD Baltic/ Asia Americas Europe UK North – Baltic/ Asia Americas Stephen Savage Europe UK North – Stephen Savage Human Resources Russia Steven Dargavel Atlantic Human Resources Russia Steven Dargavel Atlantic James Reynir Bjorn •Pete Pete Osborne Corporate James Reynir Bjorn •Pete Pete Osborne Corporate Liu Gislason Einarsson Osborne Sigurjon Liu Gislason Einarsson Osborne Bragi Thor Communication Sigurjon •Stephen Bragi Thor Communication Markusson •Stephen Marinosson Markusson Dargavel Heiðrun Jonsdottir Marinosson Dargavel Heiðrun Jonsdottir Shipping •Stephen Shipping •Stephen Savage Bragi Thor Marinosson Information Savage Bragi Thor Marinosson Information Sigurjon Markusson Sigurjon Markusson Technology Technology Arni Rafn Jonsson Arni Rafn Jonsson • Eimskip Asia •Innovate •Containerships •Atlas •Daalimpex •Eimskip •Corby Chilled •Versacold •ERL •Faroe Ship •Intra US&CA •Eimskip CTG
Service Sectors - Logistics and Shipping Logistic Shipping ERL Intra Us & CA Asia
Global Reefer Value Chain
Largest cold store company in the world • An extensive reefer network between N-America, S- America, Australia, Europe and Asia – 171 coldstores in 5 continents (with Versacold) • N-America • 100 cold stores • S-America • 2 cold stores • Australia • 14 coldstores in Australia • 9 coldstores in New Zealand • Europe • 30 cold stores in UK and an extensive inland network • 10 cold stores and 15 reefer vessels between Norway and mainland Europe and Baltic/Russia • 6 cold stores in the Netherlands • Asia – Eimskip Qingdao • Operation of the largest cold store in China – 100 thousund pallets
Coldstore facilities incl. Versacold
Key Customer Worldwide
Versacold / Atlas
Main assumptions in Versacold ’ s take-over bid • Price: $12.25 per unit payable in cash • The Trustees of the Fund unanimously recommended that Unitholders accept the offer – UBS Investment Bank, the Fund ’ s financial advisor, has provided an opinion that the offer is fair from a financial point of view to Unitholders – Termination Fee – $20 million • Lock Up Agreement – Eimskip has a lock-up agreement to tender 25.3% of the total units – Bid subject to normal conditions, MAC, Regulatory Approvals, 66 2/3% tender • Timing – Bid to be open until 8:00 PM July 27, 2007 • Total cost of take-over bid CAD 1.2 billion • Fully financed by Eimskip, RBC Capital Markets and KingSett Capital
Versacold Overview • Versacold is one of the top three PRW companies in North America and in the world. • Listed on the Toronto Stock Exchange (ICE.UN) • The history of Versacold spans more than 60 years • It has a network of 72 refrigerated and frozen-food distribution centers in Canada, United States, Australia, New Zealand and Argentina • Total capacity of 291 million cubic feet of refrigerated storage space • Versacold has more than 3,700 customers, including major companies such as Kellogg ’ s, Costco, Cargill Foods, Overwaitea, Maple Leaf, Saputo, Nestle, Birds Eye and Pillsbury • More than 4,500 employees • Strong experienced management team with collectively more than 100 years of experience in the industry
Key Customers – North American Market September 2006 Atlas Versacold PRW market coverage: Primary distribution 45% revenues 20% revenues Secondary distribution 55% revenues 80% revenues Key Customers: Kraft ~ Kellogg ’ s Kroger Good Humor Costco ~ Cargill Foods Pilgrim ’ s Pride Overwaitea McCain Maple Leaf ~ Saputo Rich & Nestle Nestle ~ Birds Eye Canada Bread Pillsbury Cavendish & Gen. Mills Export Packers
Recent developments in Versacold • Versacold has grown rapidly in recent years both through organic growth and acquisitions • 2003: acquires Geneva Lakes PRW increasing capacity by 35% • End 2005: acquires P&O PRW and Transportation operations. Storage capacity triples Million of CDN $ 2006 2005 2004 2003 Total Revenue 693 210 176 149 Total EBITDA 101 35 33 28 % Revenues 14,6% 16,6% 18,9% 18,9%
Atlas & Versacold – Geographic Coverage
Atlas Profit Improvement Initiatives • Labor/Corporate Optimization – Annual impact $18M • November 1 thru December 15 – Top Management Restructuring • Jan 1 thru February 28 – Middle Management Restructuring • April thru May – General Work Force Restructuring • Price strategy revised • IT Optimization – Annual Impact $5.4M • Focus on cross-selling additional service and capabilities to global customers using Eimskip ’ s global technical know-how • Focus on Property sales • The proceeds will be used to pay down debt and for further growth
Cash flow, balance sheet and net debt ratio
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