Genco Shipping & Trading Limited · NYSE:GNK
Genco Shipping & Trading — Investor Day (January 2009)
32 slides from Genco Shipping & Trading's investor day presentation, Jan 27, 2009
Slide 1: Genco Shipping & Trading Limited Investor Day
Genco Shipping & Trading Limited Investor Day January 27, 2009
Slide 2: Forward Looking Statements
Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements ar
Slide 3: Agenda
Agenda Company Overview Financial Overview Industry Overview Conclusions 3
Slide 4: Company Overview
Company Overview
Slide 5: Management
Management Peter Georgiopoulos Gerry Buchanan John C. Wobensmith Chairman President Chief Financial Officer Over 20 years of Over 40 years of 15 years of experience in experience in the shipping experience in the shipping the shipping industry industry industry CFO since inception Chairman
Slide 6: Key Investment Highlights
Key Investment Highlights Modern high-quality fleet Significant time charter coverage with reputable charters Collateral maintenance clause concern resolved Financing in place for Newbuilding program Flexibility for future growth U.S. - based quality management team with transparent oper
Slide 7: Genco Overview
Genco Overview Founded in December 2004, completed IPO in July 2005 High quality, modern fleet of 32 vessels ― Average age of 6.5 years compared to the average age of the world fleet of approximately 15 years ― Expected delivery of 3 additional vessels through the fourth quarter of 2009 Operat
Slide 8: Diversified and Modern Fleet
Diversified and Modern Fleet Vessel Name Year Built Dwt A Portfolio Approach to Maximize ROC Capesize Genco Augustus 2007 180,151 Modern, diversified fleet Genco Tiberius 2007 175,874 Genco London 2007 177,833 ― 6 Capesize Genco Titus 2007 177,729 Genco Constantine 2008 180,183 ― 8 Panamax Genco H
Slide 9: High Quality Operations
High Quality Operations Extensive relationships with Selected Customer Relationships established drybulk charterers These relationships help us to: ― Stabilize revenue through favorable contract terms ― Minimize counterparty risk ― Maximize fleet utilization We utilize three leading technical
Slide 10: Financial Overview
Financial Overview
Slide 11: Credit Facility Amendment
Credit Facility Amendment Amended AmendedRevolving RevolvingFacility Facility Highlights Highlights Collateral maintenance covenant waived until compliance achieved Amount Up to $1.4 billion Dividend and share buyback Term 10 Years programs suspended until Quarterly $12.5 million starting compli
Slide 12: Liquidity Position
Liquidity Position Projected 12/31/08 (Dollars in thousands) Liquidity Position Revolving Credit Facility $1,377,000 Drawn Portion(1) (1,173,300) Undrawn Portion $203,700 Cash(2) $125,000 Total Liquidity $328,700 (1) December 31, 2008 projected debt takes into effect the cash repayment of $53 millio
Slide 13: Acquisition Vessel Payment Schedule
Acquisition Vessel Payment Schedule (Dollars in thousands) Expected Deposit as % of Deposit Payment on Vessel Name Delivery (1) Purchase Price Payment (2) Delivery Metrostar Acquisition Vessels Genco Commodus Q2 2009 20% 24,200 96,800 Genco Maximus Q2 2009 20% 24,000 96,000 Genco Claudius Q3 2009 20
Slide 14: Q4 2008 Unusual Events
Q4 2008 Unusual Events (Dollars in millions) Income Statement Description Event Effect Cancellation of six-vessel acquisition Charge to operating ($54.0) expenses (Forfeiture of 10% deposit) Cancellation of $320 million facility Charge to interest ($2.3) expense (Write-off of deferred financing fees
Slide 15: Q4 2008 Estimated Break-Even Levels
Q4 2008 Estimated Break-Even Levels(1) Daily Expenses by Category Free Cash Flow(2) Net Income Direct Vessel Operating(3) 4,700 4,700 General & Administrative(4) 987 1,456 Management Fees(5) 259 259 Dry Docking (6) 708 - Interest Expense (7) 5,059 4,637 Depreciation(8) - 7,013 Daily Break-Even(9) 11
Slide 16: 2009 Estimated Drydocking Schedule
2009 Estimated Drydocking Schedule Vessel Name Next DD Month Proposed Budget(1) Genco Muse January 2009 $650,000 Genco Explorer April 2009 $750,000 Genco Vigour May 2009 $850,000 Genco Beauty June 2009 $800,000 Genco Marine July 2009 $850,000 Genco Reliance September 2009 $600,000 Genco Warrior Octo
Slide 17: Industry Overview
Industry Overview
Slide 18: Global Seaborne Trade – 2008F
Global Seaborne Trade – 2008F Total Seaborne Trade Drybulk Seaborne Trade General Other Bulk Steam Coal Drybulk 9% 19% Container 16% Coking 38% 37% 7% Coal 37% 10% 27% Liquid Iron Ore (Oil / Gases / Grain Chemical) 8.3 billion tons 3.1 billion tons Source: Clarkson’s Research Services; 2008 Forecast
Slide 19: Major Drybulk Trade Routes
Major Drybulk Trade Routes Iron Ore Coal Source: Drewry Grains 19
Slide 20: BDI Review & Key Events
BDI Review & Key Events Baltic Dry Index (BDI Points) BHP concludes price negotiations with China Olympics Vale Re-Negotiations 12,000 Paralympics Global Credit Crisis 10,000 Lack of Trade Credit 8,000 Steel Mills Cut Production 15 – 30% 6,000 Decreasing Iron Ore Stock Piles Increa
Slide 21: Demand Side Fundamentals
Demand Side Fundamentals Increased capesize vessel activity from Brazil and Australia ― ≈ 60 vessels in short term lay-up vs. ≈ 130 vessels at the height Steadily declining iron ore inventories ― Latest data point at approximately 60mt vs. 70mt in September ― Re-opening of small to medium sized
Slide 22: Supply Side Fundamentals
Supply Side Fundamentals Credit crunch poses threat to new as well as existing yards Newer yards are unable to obtain refund guarantees and working capital Over 30% of the fleet is greater than 20 years old and will need renewal(1) Estimated 250 vessel cancellations so far, plus delays Vas
Slide 23: Chinese Stimulus Plan
Chinese Stimulus Plan Chinese economic growth is mostly domestically driven by urbanization and industrialization $586 billion stimulus plan towards housing and transportation infrastructure(2) ― Approved by the state council ― 1/3rd expected to reach project level by the end of Q1 ― Includes $2
Slide 24: Drybulk Catalysts
Drybulk Catalysts Key KeyFactors Factorsfor forSlowdown Slowdown Turnaround TurnaroundCatalysts Catalysts Financial Crisis Normalized Trade Credit Lack of Trade Credit Chinese Infrastructure Chinese Economic Slowdown Investment Early Conclusion of Iron Ore High Iron Ore Inventories Negotiations - (b
Slide 25: Conclusions
Conclusions
Slide 26: Genco’s Strategy
Genco’s Strategy Maintain Focus on Drybulk Sector with ROC Approach Consistent Time Charter Strategy Modern High-Quality Fleet Cost Efficient Operations Transparent Operations 26
Slide 27: Appendix
Appendix
Slide 28: Current Fleet
Current Fleet * Cash Daily Net Revenue Vessel Type Vessel Name Year Built Charterer Charter Expiration (3) Rate (1) Daily Rate (2) Genco Augustus 2007 Cargill International S.A. 45,263 62,750 December, 2009 Genco Tiberius 2007 Cargill International S.A. 45,263 62,750 January, 2010 Capesize Genco Lon
Slide 29: Footnotes to Fleet Table
Footnotes to Fleet Table (previous page) (1) Time charter rates presented are the gross daily charterhire rates before the payments of brokerage commissions ranging from 1.25% to 6.25% to third parties, except as indicated for the Genco Leader in note 6 below. In a time charter, the charterer is res
Slide 30: Year to Date Earnings
Year to Date Earnings Three Months Ended Nine Months Ended September 30, 2008 September 30, 2007 September 30, 2008 September 30, 2007 (Dollars in thousands, except share and per share data) (Dollars in thousands, except share and per share data) (unaudited) (unaudited) INCOME STATEMENT DATA: Revenu
Slide 31: September 30, 2008 Balance Sheet
September 30, 2008 Balance Sheet September 30, 2008 December 31, 2007 (Dollars in thousands) (unaudited) BALANCE SHEET DATA: Cash $ 142,455 $ 71,496 Current assets, including cash 220,815 267,594 Total assets 2,030,947 1,653,272 Current liabilities, including current portion of long-term debt 31,133
Slide 32: 3rd Quarter Highlights
3rd Quarter Highlights Three Months Ended Nine Months Ended September 30, 2008 September 30, 2007 September 30, 2008 September 30, 2007 (unaudited) (unaudited) FLEET DATA: Total number of vessels at end of period 31 22 31 22 Average number of vessels (1) 29.9 19.9 28.7 19.5 Total ownership days for
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