MPC Container Ships ASA · OSL:MPCC
MPC Container Ships ASA — Q2 2020 Earnings Presentation
26 slides from MPC Container Ships ASA's earnings presentation, Aug 31, 2020
Slide 1: Q2 2020 Earnings Presentation
Q2 2020 Earnings Presentation Oslo, 31 August 2020
Slide 2: Disclaimer
DISCLAIMER THIS PRESENTATION (THE “PRESENTATION”) HAS BEEN PREPARED BY MPC CONTAINER SHIPS ASA (THE “COMPANY”) FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES DESCRIBED HEREIN. TO THE BEST KNOWLEDGE OF THE COMPANY, ITS
Slide 3: Q2 2020 Earnings Presentation Agenda
Q2 2020 EARNINGS PRESENTATION 1) Highlights Q2 2020 2) Market Update 3) Outlook 4) Appendix 3
Slide 4: Highlights Q2 2020: Key Figures
HIGHLIGHTS Q2 2020: KEY FIGURES FINANCIAL PERFORMANCE Operating revenue: USD 39.1m (Q1 2020: USD 46.0m) EBITDA: USD 1.4m (Q1 2020: USD 7.5m) Operating Cash Flow: USD 2.5m (Q1 2020: USD 12.8m) Net Loss: USD 17.6m (Q1 2020: USD 10.7m) OPERATIONAL PERFORMANCE Fleet utilization1: 87% (Q1 2020:
Slide 5: Highlights Q2 2020: Key Developments
HIGHLIGHTS Q2 2020: KEY DEVELOPMENTS Strong focus on liquidity levels to preserve flexibility in unprecedented market environment • Q2 revenues affected by deteriorating charter market (lower utilization and charter rates) Financials • Non-performance of buyer of AS Leona and AS Lauretta – legal act
Slide 6: Highlights Q2 2020: Recapitalization July 2020
HIGHLIGHTS Q2 2020: RECAPITALIZATION JULY 2020 AMENDED CREDIT AGREEMENTS AND EQUITY PLACEMENT TO TAKE THE COMPANY THROUGH COVID-19 1 Development liquidity position (pro forma) Liquidity runway simulation Improved liquidity USDm 12 4 Date Jun-20 Dec-20 Jun-21 Dec-21 Jun-22 Dec 22 … position / runway
Slide 7: Q2 2020 Earnings Presentation Agenda
Q2 2020 EARNINGS PRESENTATION 1) Highlights Q2 2020 2) Market Update 3) Outlook 4) Appendix 7
Slide 8: Market Update: Severe Recession in 2020 Due to COVID-19
MARKET UPDATE: SEVERE RECESSION IN 2020 DUE TO COVID-19, RECOVERY STARTED IN JUNE GDP GROWTH INTERNATIONAL TRADE CONTAINER TRADE S/D BALANCE % % 10 10 8.4 10 8 4.7 5 3.0 8 2.9 6 5.0 3.8 4.1 0.9 5.6 5.6 6.3 3.4 3.6 5.4 2.7 6 4 2.9 0 4.6 1.4 0.4 4.0 2 4 4.3 2.9 -5 3.8 0 -5.2 2 1.2 1.5 -2 -10 1.7 -4 -1
Slide 9: Market Update: Solid Supply / Demand Fundamentals
MARKET UPDATE: SOLID SUPPLY / DEMAND FUNDAMENTALS ENCOURAGING TRADE OUTLOOK AFTER RECOVERY MODERATE FLEET GROWTH IN 2021 Mainlane Non-mainlane East-West North-South Intra-Regional <3k TEU 3-8k TEU 8-12k TEU >12k TEU k TEU m TEU 200 194.0 25 24.0 184.9 188.6 23.3 23.0 177.4 178.6 22.1 180 169.1 20.9
Slide 10: Market Update: Orderbook and Age Structure Support Market Fundamentals
MARKET UPDATE: ORDERBOOK AND AGE STRUCTURE SUPPORT MARKET FUNDAMENTALS HISTORIC LOW ORDERBOOK-TO-FLEET RATIO ORDERBOOK BY SIZE CLUSTER (TEU) M TEU Percent Total Fleet Orderbook Orderbook to Fleet Ratio (rhs) <3k TEU 24 70 368,977 3-8k TEU 22 60 (17%) 20 8-12k TEU 38,076 18 >12k TEU 50 (2%) 16 14 40
Slide 11: Market Update: Recent Charter-Market Momentum Showed Signs of Recovery
MARKET UPDATE: RECENT CHARTER-MARKET MOMENTUM SHOWED SIGNS OF RECOVERY TIME-CHARTER RATE DEVELOPMENT IDLE STATISTICS (AS OF 17 AUG 2020) No. Feeder Vessels - 35 vessels in dry dock for scrubber retrofits (16%) k USD / day 1k TEU grd 2.75k TEU 6.8k TEU 550 550 30 1.7k TEU grd 4.4k TEU <1k 500 28 1-3k
Slide 12: Q2 2020 Earnings Presentation Agenda
Q2 2020 EARNINGS PRESENTATION 1) Highlights Q2 2020 2) Market Update 3) Outlook 4) Appendix 12
Slide 13: Outlook: Recent MPCC Performance vs. Market
OUTLOOK: RECENT MPCC PERFORMANCE VS. MARKET IDLE TIMES: MPCC BETTER THAN MARKET BENCHMARK1 RATES: MPCC RATES VS. LAST DONE3 Idle days market2 Idle days MPCC better same worse Clarksons TC Rate Index No. of fixtures 15% 15% 40 65 13%12% 20 60 11% 20 10% 10% 20 14 12 9% 13 55 10% 8% 8% 0 5 4 4 1 2 2 5
Slide 14: Outlook: Strong Cash Flow and De-leveraging Capacity
OUTLOOK: STRONG CASH FLOW AND DE-LEVERAGING CAPACITY H1 CASH BREAK-EVEN (“CBE”)1 INDICATIVE ANNUALIZED FCF SENSITIVITIES5 in USD per day per vessel FCF Yield -3% 12% 21% 43% 139% (%)6 7,760 145 6,960 800 925 FCF (incl. DD) 6,035 111 EBITDA 790 68 4,762 51 44 32 34 17 10 483 Voyage OPEX G&A and Opera
Slide 15: Outlook: Large Upside to Pre COVID-19 Level, Historical Asset Values and NB Parity
OUTLOOK: LARGE UPSIDE TO PRE COVID-19 LEVEL, HISTORICAL ASSET VALUES AND NB PARITY UPSIDE POTENTIAL (IN USDM) 582 483 242 80 NAV (USDm) Implied value at Pre covid-19 asset values 2018 avg. asset value NB Parity current share price (Clarksons)1 (Clarksons)1 (Clarksons)1 NAV/share 2.00 6.03 12.06 14.5
Slide 16: Outlook: Well Positioned for an Anticipated Market Recovery
OUTLOOK: WELL POSITIONED FOR AN ANTICIPATED MARKET RECOVERY Largest container feeder tonnage provider globally with strong industry network and flexible fleet to benefit from shifting trading pattern (e.g. regionalization, nearshoring) Strong operational track record, robust governance and suppo
Slide 17: Q2 2020 Earnings Presentation Agenda
Q2 2020 EARNINGS PRESENTATION 1) Highlights Q2 2020 2) Market Update 3) Outlook 4) Appendix 17
Slide 18: Appendix: Financials – Overview Q2 2020
APPENDIX: FINANCIALS – OVERVIEW Q2 2020 BALANCE SHEET AS PER 30 JUNE 2020 PROFIT AND LOSS Q2 2020 30/06/2020 31/03/2020 Q2 2020 Q1 2020 Assets 698.1 716.4 Operating revenues 39.1 46.0 Non-current Assets 644.6 648.4 Gross Profit 3.4 9.4 Current Assets 53.5 68.1 EBITDA 1.4 7.5 thereof Cash & Cash Equi
Slide 19: Appendix: Financials – Development of Charter Rates and Utilization
APPENDIX: FINANCIALS – DEVELOPMENT OF CHARTER RATES AND UTILIZATION CONSOLIDATED FLEET No. of consolidated vessels 58 61 61 61 61 60 60 60 60 60 60 (end of period) Trading ratio 1 92% 93% 89% 92% 90% 93% 93% 96% 93% 89% 87% 10,230 9,841 9,991 9,911 9,240 9,071 8,885 8,969 8,718 8,505 7,938 5,129 5,0
Slide 20: Appendix: Increase in Scrap Prices Since June and Slight Increase in S&P Activity
APPENDIX: INCREASE IN SCRAP PRICES SINCE JUNE AND SLIGHT INCREASE IN S&P ACTIVITY NEW BUILDING PRICES SCRAP VALUE (2,000 TEU VESSEL, GLS) 2750 teu gls 1700 teu grd 1000 teu grd India Bangladesh Pakistan Turkey m USD USD/ldt 40 500 Aug-20 (% m/m): Aug-20 (% m/m): 400 30 30.0 (0%) 370 (23%) 360 (18%)
Slide 21: Appendix: Aged Feeder Fleet and Historic Low Order Book
APPENDIX: AGED FEEDER FLEET AND HISTORIC LOW ORDER BOOK ORDER BOOK, CONTRACTING AND AGE STRUCTURE DELIVERIES AND DEMOLITIONS 0.1-2.9k TEU Contracting Orderbook-to-Fleet Ratio (RHS) k TEU k TEU 2.9k+ TEU Contracting % 2,000 Deliveries 1-3k TEU Deliveries Total (without 1-3k TEU) 2,500 20 15.7 2,000 1
Slide 22: Appendix: ESG at MPC Container Ships
APPENDIX: ESG AT MPC CONTAINER SHIPS ENVIRONMENTAL COMMITMENT • Significant investments in exhaust gas cleaning and ballast water management systems • Continuously optimise vessel operations and minimise environmental impact of our business by exploring viable options for emission reductions and exc
Slide 23: Appendix: Corporate Structure
APPENDIX: CORPORATE STRUCTURE DEBT FACILITIES STRUCTURED IN FOUR SEPARATE AND RING-FENCED SILOS1 MPC Container Ships ASA (“Parent”) 100% 100% 100% 50% MPCC First Bluewater Holding MPC Container Ships MPCC Second Financing Financing GmbH & Co. Schifffahrtsgesellschaft Invest B.V. GmbH & Co. KG2 KG Gm
Slide 24: Appendix: MPCC Fleet – Regional and Size Distribution
APPENDIX: MPCC FLEET – REGIONAL AND SIZE DISTRIBUTION HEAT MAP OF MPCC FLEET (AS PER 31/08/2020) Intra-Europe No of vesels: 10 Avg. TEU: 1,909 Top 3 Cluster # of Vsls 2,500 HR grd 1 2,800 gls 3 Intra-Asia 1,500 gls 2 No of vesels: 19 Avg. TEU 2,231 Latin America and Top Charterer # of Vsls Top 3 Clu
Slide 25: Appendix: MPCC Fleet Employment (1/2)
APPENDIX: MPCC FLEET EMPLOYMENT (1/2) EMPLOYMENT STATUS & TIME CHARTER COVERAGE (AS PER 31/08/2020) Current Rate No. Vessel Cluster Charterer Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 ($pd) 1 AS LAETITIA 1000 grd King Ocean 5,600 2 AS LAGUNA 1000 grd
Slide 26: Appendix: MPCC Fleet Employment (2/2)
APPENDIX: MPCC FLEET EMPLOYMENT (2/2) EMPLOYMENT STATUS & TIME CHARTER COVERAGE (AS PER 31/08/2020) Current Rate No. Vessel Cluster Charterer Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 ($pd) 37 AS ANGELINA 2200 grd Maersk Line 7,100 38 AS PAOLA 2500 gr