Q3 2015 Oslo, 5 November 2015 Disclaimer This presentation - - PowerPoint PPT Presentation

Q3 2015

Oslo, 5 November 2015

Disclaimer

This presentation contains forward looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as “anticipate”, “believe”, “continue”, “estimate”, “expect”, “intends”, “may”, “should”, “will” and similar expressions. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although Avance Gas believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this presentation by such forward-looking statements. The information, opinions and forward-looking statements contained in this presentation speak only as at its date, and are subject to change without notice.

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Hig ighlig ights Financ nancial als Fleet & t & Mar arket t Updat ate Summar mmary & Ou Outl tlook

Agenda

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Christi stian A an And nderse sen n – Pr Presi sident nt

Company Representatives

Highlights

• TCE rate of US$ 96 900 / day, up from US$ 86 900/day in Q2
• Newbuildings delivered:

Sirocco – 17th July Levant – 18th August Chinook – 22nd September Pampero – 19th October (Q4)

• Board declared a dividend of US$ 2.11 per diluted share

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Highlights

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Q3 2015 Comments Average Time Charter Equivalent

Avance Gas Spot VLGC Index 1 Month prior to Calendar Quarter

USD (000s (000s) Th Three mo mont nths e end nded 30 S 30 Septemb mber 2015 2015 Th Three mo mont nths e end nded 30 J 30 June ne 2015 2015 Oper eratin ing R Rev even enue 109, 109,943 943 68, 68,576 576 Voyage expenses (15, (15,499 499) (9, (9,458 458 ) Operating expenses (7, (7,727 727) (5, (5,875 875 ) Administrative and general expenses (1, (1,409 409) (2, (2,435 435 ) Oper eratin ing P Profit it bef efore D e Dep eprec ecia iatio ion E Expen ense 85, 85,308 308 50, 50,808 808 Depreciation expenses (8, (8,833 833) (6, (6,854 854) Op Operating ng Pr Profit (L (Loss) 76, 76,475 475 43, 43,954 954 Non

• n-Op

Operating ng Inc ncome me (E (Expens nses): ): Finance expense (3, (3,587 587) (2, (2,666 666 ) Finance income 31 31 44 44 Foreign currency exchange gain (88 (88) 1 (3, (3,644 644) (2, (2,621 621 ) Net t Profit ( t (Loss) 72, 72,831 831 41, 41,333 333 Earnin ings p per er Share: e: Net profit (loss) Basic 2. 2.12 12 1. 1.20 20 Diluted 2. 2.11 11 1. 1.20 20

Financials – Q3 2015

• Operating revenue increased to US$ 110 million, from US$ 69

million, with TCE earnings of US$ 94 million

• Increased operating expenses attributable to new ships

added to the fleet

• Financial expenses increased by US$ 0.3 million due to

increased interest bearing debt

• A&G expenses down by US$ 1 million
• Net profit of US$ 73 million (US$ 2.11/share), up from US$ 41

million (US$ 1.20/share) in Q2

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Financials

Income Statement Comments

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USD (000s (000s) 30 S 30 Septemb mber 2015 2015 30 J 30 June ne 2015 2015 Cash and cash equivalents 63, 63,347 347 99, 99,022 022 Receivables 69, 69,049 049 52, 52,236 236 Related party receivable balances 130 130 109 109 Prepaid expenses and inventory 5, 5,235 235 4, 4,531 531 Derivative financial instruments — 553 553 Other current assets 2, 2,078 078 767 767 Total tal C Current t As Assets ts 139, 139,839 839 157, 157,218 218 Property, plant and equipment 896, 896,560 560 657, 657,354 354 Newbuildings deposit 17, 17,475 475 69, 69,700 700 Goodwill 2, 2,290 290 2, 2,318 318 Total tal N Non-current As t Assets ts 916, 916,325 325 729, 729,372 372 Total tal As Assets ts 1, 1,056, 056,164 164 886, 886,590 590 Current portion of long-term debt 39, 39,806 806 55, 55,545 545 Accounts payable 1, 1,138 138 1, 1,809 809 Related party payable balances 692 692 939 939 Accrued voyage expenses 5, 5,201 201 3, 3,362 362 Accrued expenses 477 477 2, 2,424 424 Derivative financial instruments 10, 10,169 169 853 853 Other current liabilities 1, 1,280 280 1, 1,802 802 Total C Curren ent Lia iabil ilit ities ies 58, 58,763 763 66, 66,734 734 Long-term debt 473, 473,062 062 317, 317,282 282 Total tal N Non-curren ent L Lia iabil ilit ities ies 473, 473,062 062 317, 317,282 282 Common shares 35, 35,278 278 35, 35,278 278 Paid-in capital 350, 350,359 359 350, 350,359 359 Contributed capital 94, 94,779 779 94, 94,776 776 Retained earnings 66, 66,661 661 35, 35,081 081 Treasury shares (12, (12,381 381 ) (12, (12,459 459 ) Other reserves (10, (10,357 357) (461 (461) Total tal S Shar areholders’ ’ Equity ty 524, 524,339 339 502, 502,574 574 Total tal L Liab abiliti ties an and S Shar areholders’ ’ Equity ty 1, 1,056, 056,164 164 886, 886,590 590

Balance Sheet Comments

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Financials

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• Total assets of US$ 1,056 million, up from US$ 887 million,

reflecting ship deliveries

• Increase in receivables due to higher demurrage rates, port

congestion in India and longer voyages

• Net interest bearing debt increased by US$ 140 million,

reflecting drawdowns related to Sirocco, Levant and Chinook

• Free cash and cash equivalents totaled US$ 63 million,

down from US$ 99 million

• Undrawn available credit lines of US$ 50 million
• Equity ratio of 49.6%

Financials – Q3 2015

USD (000s (000s) ) Three m ee months ended ed 30 30 Sep eptem ember er 2015 2015 Th Three mo mont nths e end nded 30 J 30 June ne 2015 2015 Cash gen ener erated ed from ( (used ed in in) o

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eratio ions 66, 66,126 126 28, 28,872 872 Debt-issuance costs (445 (445) (687 (687) Interest paid (2, (2,659 659) (1, (1,940 940) Net t cash gen ener erated ed by (used ed in in) o

• per

eratin ing a activ ivit ities ies 63, 63,022 022 26, 26,245 245 Cash flows u used ed in in in inves estin ing a activ ivit ities ies: Capital expenditures (199, (199,512 512) (118, (118,416 416) Net t cash u used ed in in in inves estin ing activ ivit ities ies (199, (199,512 512) (118, (118,416 416) Cash sh f flows ws from (u m (used in) n) fin inancin ing a activ ivit ities ies: Proceeds from issuance of long-term debt 150, 150,000 000 100, 100,000 000 Dividends (41, (41,244 244) (24, (24,052 052) Repayment of long-term debt (7, (7,889 889) (6, (6,323 323) Purchase of own shares — — Exercise of share options 48 48 75 75 Net t cas ash provid ided ed b by fin inancin ing activ ivit ities ies 100, 100,819 819 69, 69,700 700 Effect of exchange rate changes on cash (4) (4) 2 Net t dec ecrea ease e in c cas ash an and cas ash e equival alents ts (35, (35,675 675) (22, (22,469 469) Cash and cash equivalents at beginning of period 99, 99,022 022 121, 121,491 491 Cas ash an and c cas ash equival alents ts at e at end o

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63, 63,347 347 99, 99,022 022

Cash Flow Statement Comments

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Financials

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• Net operating cash flow was US$ 63 million, up from US$ 26

million

• Net cash flow from financing and investment activities was

negative US$ 98 million, of which US$ 41 million was paid as dividends

• A net decrease in cash of US$ 36 million mainly due to

increased working capital, deliveries of newbuildings and dividend payment

Financials – Q3 2015

Av Avance Built: 2003 Capacity (cbm): 82,557 Yard: Kawasaki (JPN) Iri ris G Glory ry Built: 2008 Capacity (cbm): 83,783 Yard: Daewoo (KOR) Th Thetis G Glory Built: 2008 Capacity (cbm): 83,783 Yard: Daewoo (KOR) Venus G Glor

• ry

Built: 2008 Capacity (cbm): 83,765 Yard: Daewoo (KOR) Pr Prov

• vidence

Built: 2008 Capacity (cbm): 84,597 Yard: Daewoo (KOR) Pr Promi

• mise

Built: 2009 Capacity (cbm): 84,597 Yard: Daewoo (KOR) Mi Mistral Built: 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC) Mon

• nsoon
• on

Built: 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC)

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Breez eeze Built: 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC) Passa ssat Built 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC) Sirocco cco Built: 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC) Le Levant Built 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC) Chinook

• ok

Built: 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC) Pa Pamp mpero Built: 2015 Capacity (cbm): 83,000 Yard: Jiangnan (PRC)

Fleet Overview

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Fleet & Market Update

Fleet Utilization Outlook

Orderbook

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Fleet & Market Update

Market Utilization VLGCs – Current Orderbook

• Source: Company

Waiting Days per Ship 3

Fleet & Market Update

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Avance Gas Spot Index vs Avance Gas Spot Fixtures

Strong Performance

• Avance Gas Spot Index based on Baltic weekly, reflecting estimated USD per day for a roundtrip Ras Tanura – Chiba –

Ras Tanura (13,642 nm), 24 hours for bunkering, 3% sea margin, bunkers prices as quoted on Fridays, lowest of Singapore and Fujairah

• Source: Company

LPG Exports – Q3 2015

LPG Exports from the Middle East VLGC LPG Exports from the US Gulf

• Source: Waterborne LPG Report

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Fleet & Market Update

US Gulf VLGC Exports

VLGC Exports from US Gulf Destination direct US Gulf VLGC export

• Source: Waterborne LPG Report

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Fleet & Market Update

Summary and Outlook

• Average YTD = US$ 85 200 / day
• Newbuildings fully delivered - fleet of 14 ships on water with cash-

break even below US$ 23 000 / day

• Increased export volumes from US Gulf in line with expectations
• Larger volume going long-haul to Asia than expected
• Spot market exposure focusing on increasing COA portfolio
• Freight market expected volatile through winter season 2015/16

with strong re-bounce spring 2016

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Summary & Outlook

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Questions?