Ardmore Shipping Corporation · NYSE:ASC
Ardmore Shipping — Q2 2021 Earnings Presentation
28 slides from Ardmore Shipping's earnings presentation, Jul 27, 2021
Slide 1: Earnings Presentation | Second Quarter 2021
Earnings Presentation | Second Quarter 2021
Slide 2: Disclaimer
Disclaimer This presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of applicable U.S. federal securities laws. All statements, other than statements of historical facts, that address activities, events or developments that Ardmore Shippi
Slide 3: Agenda
Earnings Release: Second Quarter 2021 3 Agenda Highlights Product Tanker Market: Recent Activity Product Tanker Fundamentals Financial Performance Summary 3
Slide 4: Highlights
Highlights 4 Reporting an adjusted loss(1) of $7.6 million, or $0.23 per share for 2Q21 compared to an adjusted loss of $8.6 million, or $0.26 per share in 1Q21 Charter rates had improved from prior quarter, but we are now heading into seasonally soft summer period: o MR charter rates $11,650 /
Slide 5: Product Tanker Market: Recent Activity
Product Tanker Market: Recent Activity 5 5
Slide 6: Product Tanker Cargo Flows & Market Activity
Product Tanker Cargo Flows & Market Activity 6 (1) (3) (2) 1. Our World in Data, July 21, 2021 2. Vessels Value 3. Includes four vessels on time charters for approx. one-year from delivery plus one vessel on a short-time charter 6
Slide 7: Product Tanker Fundamentals
Product Tanker Fundamentals 7 7
Slide 8: Oil Demand Recovery Well Underway
Oil Demand Recovery Well Underway… 8 Oil Demand to Reach Pre-COVID Levels by this Winter(1) Oil Demand Recovery from 2Q21: Aviation & Road Fuels(2)(3) 105 4.0 3.6 100 3.5 0.3 2.8 Million Barrels / Day Million Barrels / Day 3.0 2.5 95 0.3 2.5 2.1 0.3 1.8 90 0.3 2.0 1.6 1.7 85 0.3 1.5 1.5 1.0 1.3 80 1
Slide 9: As Refinery Dislocation Boosting Tonne-Mile Demand
…As Refinery Dislocation Boosting Tonne-Mile Demand(1)(2)9 1. See slide 22 for illustrative tonne-mile impact of refinery dislocation 2. See slide 26 for further detail on refineries 9
Slide 10: Supply Growth Remains Constrained
Supply Growth Remains Constrained 10 Significant increase in ordering activity in other shipping sectors Product Tanker Orderbook(1) resulting in a “crowding out” of tankers and curtailing future 180 70% supply 160 6.7% 60% 140 Total product tanker orderbook stands at 208 vessels (41 LR2s, 50% 1
Slide 11: Financial Performance
Financial Performance 11 11
Slide 12: Financial Highlights
Financial Highlights INCOME STATEMENT DATA Three Months Reporting EBITDA(1) of $5.4 million and adjusted loss(2) of $7.6 US$ millions, unless otherwise stated June 30, 2021 June 30, 2020 million, or $0.23 per share, for the three months ended June 30, Results 2021 EBITDA(1) $5.4 $27.9 Adjusted (lo
Slide 13: Fleet and Operations Highlights
Fleet and Operations Highlights Continuing to invest in the fleet to optimize operating performance: Fleet Maintenance Capex(1) $7 $6.2 o No drydockings were completed in 2Q21 due to constraints with yard $6 availability. Three drydockings including one ballast water treatment Total Capex (Million
Slide 14: Ardmore Product and Chemical Tanker Rates
Ardmore Product and Chemical Tanker Rates 14 FLEET AVERAGE TCE MR ECO-DES(1) MR ECO-MOD(1) CHEMICAL(2) 21,539 20,072 20,192 18,003 16,337 13,964 13,036 12,737 12,432 12,291 11,893 11,349 11,796 11,540 11,805 11,765 11,130 12,308 9,764 10,096 11,944 9,603 11,037 9,052 10,916 Capital Adjusted TCE 2Q20
Slide 15: Capital Allocation Focused on Financial Strength
Capital Allocation Focused on Financial Strength 15 Balance Sheet Summary Strong liquidity and balance sheet; total net debt was $321.4 million US$ millions, unless otherwise stated June 30, 2021 Dec 31, 2020 with corporate leverage (net debt) of 47.6%(1) Cash 55.4 58.4 Receivables, Inventories an
Slide 16: Summary
Summary 16 16
Slide 17: Summary
Summary 17 Product tanker charter rates slightly improved q-o-q; heading into a seasonally slow period with lower activity levels exacerbated by COVID-19 related oil demand weakness Chemical tankers performing well on a relative basis; rates outperformed product tankers for last three quarters
Slide 18: Appendix
Appendix 18 18
Slide 19: Progress and Energy Transition Plan
Progress and Energy Transition Plan Ardmore’s modern “Eco” fleet is well-positioned for the increasingly Ardmore Fleet Avg. Efficiency Rating 5% Better Than Targets stringent regulatory framework Fleet Eco-Des Eco-Mod Chem o Fleet average age of 7.9 years all built at top-tier yards (global produc
Slide 20: Ardmore Energy Transition Plan: Announced February 2021
Ardmore Energy Transition Plan: Announced February 2021 Work with technical and commercial partners to develop solutions addressing the energy transition: onboard energy efficiency and future fuels (zero carbon or carbon-neutral) Energy Transition Retrofits and newbuilding features to improve hy
Slide 21: Key Performance Drivers
Key Performance Drivers 21 MR Spot TCE Quarterly: Coming off Trough Levels(1) Modern High-Quality Fleet: Strong On-Hire Performance(2) $21,256 n/a n/a 21.4 Days n/a n/a $12,983 $11,145 $11,255 $9,436 99.65% 99.31% 98.66% 99.31% 99.39% 2Q20 3Q20 4Q20 1Q21 2Q21 2Q20 3Q20 4Q20 1Q21 2Q21 (3) Average Day
Slide 22: Impact of Refinery Dislocation
Impact of Refinery Dislocation 22 1. “Refinery shift” means closure of refinery in one location (e.g. Europe or Australia) and opening of refinery in another location (e.g. Middle East or China) 2. An MR can carry approx. 300,000 barrels of refined products. Assumes voyage length of 30 days on a one
Slide 23: Fleet Profile
Fleet Profile Vessel Name Type Dwt Tonnes IMO Built Country Flag Specification High Quality Vessels Ardmore Seavaliant Product/Chemical 49,998 2/3 Feb-13 Korea MI Eco-design Modern, highly fuel-efficient Ardmore Seaventure Product/Chemical 49,998 2/3 Jun-13 Korea MI Eco-design fleet of MRs is well
Slide 24: Supplementary Industry Data
Supplementary Industry Data 24 24
Slide 25: Refinery Summary and Seaborne Product Trade
Refinery Summary and Seaborne Product Trade 25 Regional Refinery Shift 2020 - 2025(1) Region Closures Openings Europe 1.0 0.1 Australia 0.5 - Middle East - 1.0 Africa 0.3 0.7 America 1.1 - China 0.2 1.8 Asia (excl. China) 1.4 5.6 Total 4.5 9.2 Forecast Seaborne Product Trade Balances(2) 2021 2022 Re
Slide 26: Refinery Development Details
Refinery Development Details 26 Global Refinery Openings(1) Global Refinery Closures(1) Capacity Capacity Refinery Status Country Date Refinery Status Country Date (bpd) (bpd) Rongsheng Opened China 2020 200,000 Kwinana (BP) Indefinite closure Australia 2020 (146,000) Jieyang Opening China 2021 400,
Slide 27: Product and Chemical Tankers: Ageing Fleet Profile
Product and Chemical Tankers: Ageing Fleet Profile Global Fleet Age Profile: Product Tankers(1)(2) 250 ~930 ships to reach 25 years old over the next 40 product tankers scrapped YTD, estimating ten years(3) scrapping of 70 vessels for FY2021(4) 200 Number of Vessels 150 100 50 - Pre- 1995 1996 1997
Slide 28: Supply Growth Remains Constrained
Supply Growth Remains Constrained 28 Ordering Activity YTD: Other Sectors Filling up Berths(1) 350 # of Vessel Newbuild Contracts 300 250 200 150 100 50 - Jan-2021 Feb-2021 Mar-2021 Apr-2021 May-2021 Jun-2021 Chemical Tanker Orderbook(1) 40 80% 3.9% 35 70% 30 60% Fleet (Million DWT) Orderbook as % F