Presentation Q3 2016 3 rd November 2016 Third Quarter 2016 financial - - PowerPoint PPT Presentation

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Presentation Q3 2016 3 rd November 2016 Third Quarter 2016 financial - - PowerPoint PPT Presentation

Nov 03, 2023 366 likes •627 views

Presentation Q3 2016 3 rd November 2016 Third Quarter 2016 financial highlights Quarterly dividend increased to USD 0.1775 per share Increase of 0.5 cents vs. Q2 13% increase annualized USD 0.71 per share annualized Dividend yield

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Presentation Q3 2016

3rd November 2016

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SLIDE 2

November 16

Third Quarter 2016 financial highlights

Quarterly dividend increased to USD 0.1775 per share

– Increase of 0.5 cents vs. Q2 – 13% increase annualized – USD 0.71 per share annualized – Dividend yield of 8.4% p.a.

EBITDA was USD 68.7m vs. USD 63.4m in Q2

– EBITDA adjusted for finance lease effects was USD 75.6m vs. USD 69.3m in Q2

Net profit before tax was USD 39.7m vs. USD 29.5m in Q2 Net profit after tax was USD 32.7m vs. USD 25.5m in Q2

– Change in deferred tax (non-cash) was USD 7.0m – Adjusted net profit was USD 33.4m vs. USD 31.6m in Q2’16

Third Quarter 2016 2

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November 16

Recent events

Issuance of new equity and unsecured bonds Investment in two chemical tankers with long term charters Gas vessels - amendment of terms and cancellation of the 3rd vessel Delivery of 5 newbuildings and completion of Aker Wayfarer modification during Q3 Dhirubhai-1 – Reduced revenues and higher costs due to planned periodical maintenance of 2.1 days Sales restrictions on AMSC bonds partly removed

Third Quarter 2016 2

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SLIDE 4

November 16

Equity and bond issues

Equity issue on 31st August 2016 – Amount: NOK 862 million – Issue price: NOK 64 /share – Purpose: New investments Bond issue on 12th September 2016 – Amount: NOK 750 million – Maturity: September 2021 – Interest rate: NIBOR + 450 bps p.a. – Purpose: Reduce Aker ASA loan facility Buy-back of bonds with maturity in 2019/2020

4 Third Quarter 2016

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November 16

Acquisition of two chemical tankers with 12 years charter to Navig8 Ltd.

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Vessel details No of vessels 2 x Vessel type IMOII chemical tanker Vessel size 45,000 dwt Delivery October & November 2016 Transaction details Purchase price USD 35 million Seller’s credit USD 6 million Charter duration 12 years Charter type Hell & high water bareboat Charterer Navig8 Ltd. (“Navig8 Group”)

Third Quarter 2016

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SLIDE 6

November 16

Gas carriers under construction at Sinopacific Offshore & Engineering (SOE)

Three newbuildings ordered at SOE in China with 15 years bareboat charter to Hartmann SOE filed for receivership in August 2016 Agreement on amended terms – 1st vessel to be delivered in November – 2nd vessel will be financed and finalized by Sumec Marine Co.

  • Ltd. at the Dayang Shipyard with expected delivery in July’17

– 3rd vessel was cancelled with USD 17.6m in pre-delivery instalments and interest repaid in Q4 2016

  • Proceeds to be re-invested into new projects

6 Third Quarter 2016

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SLIDE 7

November 16

1st liquefied ethylene gas (LEG) carrier “Gaschem Beluga” on sea trial

7 Third Quarter 2016

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SLIDE 8

November 16

Delivery schedule of vessels

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2 1 1 1 1 4 1 1 1 1 2 3 1 1 1 2 3 4 5 6 7 Q2’16 3 Q1’16 3 Q4’16 Q2’17 7 Q3’17 6 Q3’16 Q1’17 Container Car carriers Product Chemical Gas Aker Wayfarer1 Delivery schedule (# vessels)

1) Including redelivery of Aker Wayfarer after major modification Third Quarter 2016

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SLIDE 9

November 16

Fleet overview per Q3 2016

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6 3 6 4 3 2 1 2 3 4 Subsea construction 2 Chemical tankers Product tankers FPSO Container vessels1 Gas carriers3 Offshore supply Car carriers

# Delivered # To be delivered

Major European container line

1) 49.5% ownership in six container vessels, 2) 75.0% ownership in SBM Installer and 3) Excludes one gas vessel that was cancelled in Q4 2016 Investor Presentation

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SLIDE 10

Charter backlog by client per Q3 2016

November 16 10

11 % 7 % 4 % 5 % 7 % 12 % 7 % 13 % 8 % 2 % 24 %

*EBITDA backlog based

  • n management’s

estimates on DB-1, certain

  • ptions not being

exercised, LIBOR forward curve, USDNOK and adj. for finance leases

Major European container line

Third Quarter 2016

Q3 EBITDA* backlog of USD 3.2 billion

  • Avg. remaining

charter tenor of 11.2 years

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SLIDE 11

November 16

Quarterly EBITDA and net profit

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Net profit per quarter (USDm) EBITDA per quarter (USDm) 53.9 Q3 2013 54.2 53.2 Q3 Q4 52.7 56.6 56.0 58.7 Q4 Q4 Q1 2014 Q2 56.4 Q1 2016 55.4 Q1 2015 63.4 Q3 55.6 Q3 68.7 55.2 Q2 Q2 Q3 28.1 30.5 Q1 2015 Q1 2016 Q2 25.5 18.6 24.5 Q4 Q4 26.5 Q2 Q3 2013 19.1 17.1 28.6 Q2 Q4 22.7 Q3 25.8 28.3 Q3 32.7 Q1 2014

Third Quarter 2016

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November 16

Adjusted EBITDA and net profit

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EBITDA adjusted for finance lease effects (USDm) 75.6 Q3 Q2 59.6 58.4 69.3 59.8 Q1 2015 57.3 Q2 Q1 2016 Q3 Q4 63.6 55.1 Q4 Q3 53.2 Q4 Q3 2013 Q1 2014 52.7 55.6 54.2 55.4 Q2 Adjusted net profit (USDm) Q2 33.4 Q3 26.2 25.6 Q4 Q3 2013 24.9 21.5 Q3 Q1 2014 Q2 26.3 27.1 27.6 Q4 Q4 29.0 Q1 2016 Q3 27.1 27.9 Q1 2015 26.9 31.6 Q2

Third Quarter 2016

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SLIDE 13

November 16

Growth in cash dividends for 12 consecutive quarters

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Dividend per share (USD cents) Adjusted earnings per share (USD cents)2 Q2 17.75 +13% 17.25 Q3 Q3 Q2 Q2 13.00 12.50 Q4 12.25 Q1 2014 Q3 2013 14.75 Q4 16.25 Q3 14.25 Q1 2016 15.75 Q1 2015 13.75 16.75 Q4 15.25 12.00

1As per 2.11.2016. Q3 2016 dividend annualized, outstanding shares as per end of Q3, share price of NOK 69.0, NOK/USD 8.2. 2Reported EPS has been adjusted for non-recurring items, FX, m-t-m of derivatives and change in deferred tax and based on weighted average no. of shares.

Q1 2015 Q2 19.73 23.21 21.28 20.55 20.25 19.86 23.94 Q2 Q3 Q1 2016 Q3 Q4 Q4 20.17 19.54 Q3 2013 Q3 18.62 Q2 19.10 Q4 19.60 16.07 Q1 2014 Dividend yield

8.4%1 p.a.

Pay-out ratio on adjusted Q3 EPS

80%

Adjusted earnings yield

10.6%1 p.a.

Third Quarter 2016

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Q2 Q3 Amounts in USD million 2016 2016 Total revenues 70.1 76.2 Vessel operating expenses (4.0) (4.6) Wages and other personnel expenses (1.3) (1.7) Other operating expenses (1.4) (1.2) EBITDA 63.4 68.7 Depreciation and amortization (24.8) (25.2) Operating profit 38.6 43.5 Financial income 4.5 4.8 Financial expenses (11.5) (15.7) Foreign exchange gains/losses 2.8 (8.8) Mark to market of derivatives (4.8) 15.9 Net financial items (9.0) (3.9) Net profit before tax 29.5 39.7 Tax payable

  • Change in deferred tax

(4.1) (7.0) Net profit after tax 25.5 32.7 Non controlling interests 0.1 (0.8) Net profit to equity holders of the parent 25.5 31.9 Earnings per share (USD) 0.19 0.23

P&L

November 16 14

Income statement

Revenues Increased revenue from delivery of newbuildings, Aker Wayfarer and income from investment in associates (Container transaction) Reduced revenues from DB-1 due to shutdown Vessel operating expenses Increased due to scheduled periodical maintenance Financial expenses Increased drawings on long-term debt in relation to newbuildings Includes USD 0.5m of non-cash interest related to build-up of potential de-mobilization expense Repurchase of own bonds Deferred tax expense Change in deferred tax is offset against deferred tax asset on balance sheet, hence, zero payable tax in the quarter. Partly due to stronger NOK against USD

Comments

Third Quarter 2016

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Q2 Q3 Amounts in USD million 2016 2016 Profit after tax 25.5 32.7

  • Repurchase of bonds
  • 0.5
  • Part cancellation of loan from Aker ASA
  • 0.4
  • Foreign exchange gains/losses

(2.8) 8.8

  • Mark to market of derivatives

4.8 (15.9)

  • Tax payable
  • Changes in deferred tax, net

4.1 7.0 Adjusted net profit after tax 31.6 33.4

Adjusted net profit after tax

November 16 15

Adjustments Comments

  • USD/NOK cross currency and interest rate swaps
  • Mainly related to bond and bank loans in NOK

Third Quarter 2016

  • Repurchase of OCY02 and OCY03
  • Upfront fee related to period cancelled
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Balance sheet

November 16 16

Balance sheet

Non-controlling interest of USD 10.2 million relates to the SBM transaction

Third Quarter 2016

Q2 Q3 Q2 Q3 Amounts in USD million 2016 2016 2016 2016 ASSETS EQUITY AND LIABILITIES Vessels and equipment 1 338.5 1 301.0 Equity att. to equity holders of the parent 699.6 816.3 Intangible assets 9.8 9.8 Non controlling interests 9.5 10.2 Finance lease receivables 555.4 614.0 Total equity 709.1 826.5 Investment in associates 1.6 165.4 Investments in AMSC Bonds 194.9 196.2 Interest-bearing loans 1 207.4 1 323.6 Deferred tax assets 29.2 22.2 Mobilization fee and advances 41.2 37.9 Restricted cash deposits 22.9 23.6 Mark to market of derivatives 66.8 22.0 Other non-current assets 0.6 0.7 Other interest-free long term liabilities 30.2 30.9 Total non-current assets 2 152.9 2 332.9 Total non-current liabilities 1 346.0 1 414.8 Interest-bearing short term debt 173.6 161.9 Liability related to investment in associates

  • 86.5

Trade- and other interest-free receivables 18.2 17.6 Mark to market of derivatives 6.3 35.3 Restricted cash deposits

  • 47.9

Trade and other payables 46.8 30.9 Cash and cash equivalents 110.8 157.4 Total current liabilities 226.8 314.6 Total current assets 129.0 222.9 Total liabilities 1 572.8 1 729.3 Total assets 2 281.9 2 555.8 Total equity and liabilities 2 281.9 2 555.8 Equity ratio 31.1 % 32.3 %

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November 16

Contractual obligations and financing

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Contractual obligations and financing, Q3 2016 Comments

  • Unrestricted cash of USD 157.4m at the end of Q3 2016
  • Restricted cash deposits of USD 47.9m will be used to pay delivery installments on 2
  • vessels. This amount is included in Secured bank financing in Other Shipping.
  • The 3rd gas vessel was cancelled in Q4 2016 with a contract price of USD 81.0m.

Consequently, USD 67.m of the related credit facility was cancelled and pre-delivery instalments of USD 17.6m (including interest) was refunded in Q4.

Amounts in USD million Other Oil Service Gas Carriers Container Vessels Other Shipping Total Already paid

  • 72.9

0.9 32.3 106.0 2016

  • 72.9

57.7 98.9 229.4 2017

  • 97.2

28.8

  • 126.0

Total contractual obligations

  • 243.0

87.4 131.2 461.5 Total remaining payments

  • 170.1

86.5 98.9 355.5 Secured bank financing 14.8 202.5 72.0 89.0 378.4 Estimated surplus cash 22.9

Third Quarter 2016

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November 16

Summary

Expect increased revenues in Q4 – Full quarter earnings effect from vessels delivered during Q3 – Delivery of 7 newbuildings during Q4 Intend to continue to make new investments in modern vessels to build a substantially larger and more diversified company Intend to continue its dividend policy of paying attractive and increasing dividends

18 Third Quarter 2016

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November 16 19

Appendix

Third Quarter 2016

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November 16

Remaining charter tenor1 by segment

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Product tankers Car carriers Chemical tankers 12.6 13.9 10.0 14.9 Average Container vessels 11.2 Offshore supply 8.6 FPSO Gas carriers 9.3 2.0 10.0 Subsea construction

# Years remaining

Major European container line

1) Average weighted tenor based on EBITDA Third Quarter 2016

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November 16

Delivery schedule of vessels

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Project Vessel Type

  • Exp. Delivery

Quantum Pacific JV MSC Diana Container 19,500 TEU 6th July ’16 Quantum Pacific JV MSC Ingy Container 19,500 TEU 6th July ’16 Akastor / AKOFS Offshore Aker Wayfarer Modification 7th July ’16 Navig8 Chemical Tankers Navig8 Topaz Chemical carrier, MR 22th July ’16 Navig8 Product Tankers Navig8 Supreme LR2 110,000 dwt 9th August ’16 Quantum Pacific JV MSC Eloane Container 19,500 TEU 28th September ’16 Navig8 Chemical Tankers Navig8 Tourmaline Chemical carrier, MR 3rd October ’16 Navig8 Ltd. Navig8 Universe Chemical carrier, MR 5th October ’16 Hartmann Gaschem Beluga Gas carrier November ’16 Navig8 Chemical Tankers Navig8 Tanzanite Chemical carrier, MR November ‘16 Navig8 Ltd. Navig8 Constellation Chemical carrier, MR November ‘16 Quantum Pacific JV MSC Mirjam Container 19,500 TEU November ’16 Quantum Pacific JV MSC Rifaya Container 19,500 TEU December ’16 Quantum Pacific JV Hull #2158 Container 19,500 TEU February ’17 Hartmann Hull #S1034 Gas carrier July ’17

Third Quarter 2016

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