Q4 2016 Oslo, 14 February 2017 Di Disc scla laimer er This - - PowerPoint PPT Presentation

Q4 2016

Oslo, 14 February 2017

Di Disc scla laimer er

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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Highlights Financials Fleet & Market Update Summary & Outlook

Ag Agend enda

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Christian Andersen – President Peder Simonsen – Chief Financial Officer

Com

• mpany

ny Repr epresent esentati tives es

Highli ghlights ghts

• TCE rate of $9,602/day, compared with $10,131/day in

Q3 2016

• Net loss of $14.0 million, compared with a net loss of

$13.5 million (excluding impairment charges of $47.2 million) in Q3 2016

• Comprehensive refinancing plan completed, including

installment deferrals, covenant waivers and raising $58.7 million in new equity

• Year-end cash of $149.1 million vs. $87.8 million per end

Q3 2016

• Cash break even at approx. $17,500/day with revised

instalment schedule

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Highlights

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Q4 2016 Comments Average Time Charter Equivalent

Avance Gas Spot VLGC Index 30 days prior to calender quarter

($ ($ 000s 000s) Th Three mo mont nths e end nded 31 D 31 Decemb mber 2016 2016 Th Three mo mont nths e end nded 30 S 30 Septemb mber 2016 2016 Oper eratin ing r rev even enue 27, 27,797 797 25, 25,720 720 Voyage expenses (15, (15,664 664) (12, (12,780 780 ) Operating expenses (9, (9,900 900) (9, (9,480 480 ) Administrative and general expenses (1, (1,082 082) (1, (1,710 710 ) Oper eratin ing p profit it bef efore d e dep eprec ecia iatio ion ex expen ense 1, 1,151 151 1, 1,750 750 Depreciation and amortization expenses (10, (10,030 030) (10, (10,510 510 ) Impairmment of goodwill ─ (1, (1,886 886 ) Impairment of vessels ─ (45, (45,298 298 ) Operati ating l loss (8, (8,879 879) (55, (55,944 944 ) Non

• n-oper

eratin ing ( (ex expen enses es) in income: e: Finance expense (5, (5,085 085) (4, (4,787 787 ) Finance income 68 68 1 Foreign currency exchange loss (3 (3) (9 (9 ) (5, (5,020 020) (4, (4,795 795 ) Income tax expense (117 (117) ─ Net l t loss (14, (14,016 016) (60, (60,739 739 ) Loss ss per er s share: e: Basic (0. (0.26 26) (1. (1.77 77 ) Diluted (0. (0.26 26) (1. (1.77 77 )

Fi Finan ancials ls – Q4 2 2016

• TCE earnings of $12.1 million, compared with $12.9 million in

Q3 2016

• Operating expenses of $9.9 million, compared with $9.5

million in Q3 2016

• Administrative expenses of $1.1 million, compared with $1.7

million in Q3 2016, mainly reflecting reduced personnel cost and cost efficiency measures

• Non-operating expenses of $5.0 million, versus $4.8 million

in Q3 2016

• Net loss of $14.0 million vs. a loss of $13.5 million, adjusted

for Q3 2016 impairment of $47.2 million

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Financials

Income Statement Comments

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($ 000s ($ 000s) 31 D 31 Decemb mber 2016 2016 30 S 30 Septemb mber 2016 2016 Cash and cash equivalents 149, 149,062 062 87, 87,783 783 Receivables 13, 13,705 705 18, 18,012 012 Related party receivables 36 36 4 Inventory 4, 4,940 940 4, 4,412 412 Prepaid expenses 724 724 2, 2,292 292 Other current assets 3, 3,193 193 1, 1,969 969 Asset held for sale ─ 13, 13,369 369 Total tal current as t assets ts 171, 171,660 660 127, 127,841 841 Property, plant and equipment 860, 860,785 785 870, 870,156 156 Goodwill and intangible assets 263 263 291 291 Total tal n non-current as t assets ts 861, 861,048 048 870, 870,447 447 Total tal as assets ts 1, 1,032, 032,708 708 998, 998,288 288 Current portion of long-term debt 20, 20,598 598 42, 42,931 931 Accounts payable 2, 2,676 676 1, 1,942 942 Related party payable balances 64 64 19 19 Accrued voyage expenses 4, 4,862 862 4, 4,135 135 Accrued expenses 204 204 605 605 Current portion of derivative financial instruments 2, 2,271 271 1, 1,360 360 Other current liabilities 1, 1,213 213 1, 1,117 117 Total curren ent l lia iabil ilit ities ies 31, 31,888 888 52, 52,109 109 Long-term debt 387, 387,201 201 376, 376,446 446 Long-term revolving credit facilities 150, 150,000 000 150, 150,000 000 Long-term derivative financial instruments 6, 6,660 660 23, 23,163 163 Total tal n non-curren ent l lia iabil ilit ities ies 543, 543,861 861 549, 549,609 609 Share capital 64, 64,528 528 35, 35,278 278 Paid-in capital 379, 379,851 851 350, 350,359 359 Contributed capital 94, 94,886 886 94, 94,797 797 Retained (loss) earnings (61, (61,566 566) (47, (47,549 549) Treasury shares (11, (11,867 867 ) (11, (11,867 867 ) Accumulated other comprehensive loss (8, (8,873 873) (24, (24,448 448) Total tal s shar areholders’ ’ equity ty 456, 456,959 959 396, 396,570 570 Total l lia iabil ilit ities ies a and shareh eholder ers’ eq equit ity 1, 1,032, 032,708 708 998, 998,288 288

Balance Sheet Comments

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Financials

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Fi Finan ancials ls – Q4 2 2016

• Cash of $149.1 million compared with $87.8 by end Q3 2016,

reflecting net proceeds from share issue ($58.7 million) and sale of Gaea of ($13.3 million) in the quarter

• Total assets of $1,032.7 million, up from $998.3 million, mainly

reflecting increased cash position, offset by depreciation of the fleet and sale of Gaea

• Receivables decreased to $13.7 million from $18.0 million,

mainly reflecting $4.5 million in collected demurrage payments

• Net total interest bearing debt decreased by $11.6 million, due

to regular interest-bearing debt repayments and debt issuance cost related to the amendment agreement

• Shareholders’ equity ratio of 44.2%, up from 39.7% in Q3 2016

reflecting the share issue in Q4 2016

Cash Flow Statement Comments

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Financials

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Fi Finan ancials ls – Q4 2 2016

($ ($ 000s 000s) ) Three m ee months ended ed 31 D 31 Decemb mber 2016 2016 Three m ee months ended ed 30 30 Sep eptem ember er 2016 2016 Cash flows f from (u m (used in) o n) operating ng activ ivit ities ies: Cash flow from operations 6, 6,364 364 21, 21,336 336 Debt issuance cost (915 (915) — Interest paid (5, (5,022 022) (4, (4,272 272) Net c t cas ash f flows fro from oper eratin ing a activ ivit ities ies 427 427 17, 17,064 064 Cash flows f from ( (used ed in in) in inves estin ing activ ivit ities ies: Capital expenditures (194 (194) (490 (490) Sale of assets (net proceeds) 13, 13,341 341 — Net et cash flows f from ( (used ed in in) in inves estin ing activ ivit ities ies 13, 13,148 148 (490 (490) Cash flows f from f fin inancin ing activ ivit ities ies: Drawdown revolving credit facility — 25, 25,000 000 Issuance of shares (net proceeds) 58, 58,742 742 — Repayment of long-term debt (11, (11,012 012) (11, (11,012 012) Net et cash flows f from f fin inancin ing activ ivit ities ies 47, 47,730 730 13, 13,988 988 Effect of exchange rate changes on cash (26 (26) (29 (29) Net et in increa ease e in in cash and c cash eq equiv ivalen ents 61, 61,279 279 30, 30,533 533 Cash and cash equivalents at beginning of period 87, 87,783 783 57, 57,250 250 Cas ash an and c cas ash equival alents ts at e at end o

• f period

149, 149,062 062 87, 87,783 783

• Net cash flow from operating activities was $0.4 million,

compared with $17.1 million in Q3 2016

• Operating cash flows include $4.5 in received demurrage

payments compared to $14.6 million during Q3 2016

• Net cash flows used in investment activities were positive

reflecting net proceeds of $13.4 million from sale of Gaea in Q4 2016

• Net cash flow from financing activities were positive of $47.7

million, mainly due to net equity issuance proceeds of $58.7 million

• A net increase in cash of $61.3 million in Q4 2016

Flee Fleet Ou t Outlo tlook

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Orderbook

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Fleet & Market Update

2017 Deliveries

• Source: Affinity, Nordic Shipping; Company

Orderbook at 15% of existing fleet 11% of 2017-deliveries completed

Waiting Days per Ship

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Fleet & Market Update

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Avance Gas Spot Index vs Avance Gas Spot Fixtures

Per erfor

• rmanc

nce

• 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 PG E Expor

• rts

ts – Q4 2 2016

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

• Source: Waterborne LPG Report

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Fleet & Market Update

LPG G Expo ports ts – 2016

VLGC Exports from the US Gulf VLGC LPG Exports from the US Gulf

• Source: Waterborne LPG Report

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Fleet & Market Update

Summary an and Outloo d Outlook

• The VLGC freight market improved slightly in Q4 2016
• Record level of US export shipments
• US exports to Asia remain strong
• Pricing environment for LPG trading more volatile
• Expect a challenging year due to high delivery of new

buildings with limited new demand for transport

• Orderbook past 2017 is limited
• Upside in current freight expectations if US VLGC export

moves towards full terminal capacity

• Strong financial position to sustain continued

challenging freight markets

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Summary & Outlook

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“AB Jesus Bagang is keeping lookout”

Photo by Johan Elfsten, Iris Glory

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Questions?