Slide 1: Grindrod Limited Audited Results and Dividend Announcement
FINANCIAL + FREIGHT + SHIPPING www.grindrod.com GRINDROD LIMITED AUDITED RESULTS AND DIVIDEND ANNOUNCEMENT for the year ended 31 December 2016 Wifi access | guest@sun Presentation and Announcement download | www.grindrod.com > Investor relations
Slide 2: Highlights: Financial and Business Environment
FINANCIAL + FREIGHT + SHIPPING HIGHLIGHTS FINANCIAL AND BUSINESS ENVIRONMENT
Slide 3: Highlights: Financial
FINANCIAL + FREIGHT + SHIPPING HIGHLIGHTS FINANCIAL • Revenue R24 930.5 million inclusive of joint ventures (2015: R27 995.4 million) • Revenue in second half R13 859.4 million (H1: R11 071.1 million) • EBITDA R690.4 million inclusive of joint ventures (2015: R1 747.5 million) • Headline loss of R45
Slide 4: Highlights: Business Environment
FINANCIAL + FREIGHT + SHIPPING HIGHLIGHTS BUSINESS ENVIRONMENT • China’s economic growth was at 6.7% for 2016, projected at 6.5% for 2017 • US growth moderate at 1.6% in 2016 • South Africa GDP at 0.5% for 2016, forecast to increase to 1.3% for 2017 • Eurozone growth 1.6% in 2016 • Commodity price r
Slide 5: Results 2016
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016
Slide 6: Management Income Statement – 2016
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 MANAGEMENT INCOME STATEMENT – 2016 R million 2016 2015 Comments Revenue 24 931 27 995 Margins and rates Reduced volumes, margins, rates and Trading profit 690 1 747 foreign exchange losses of R138 million Average exchange rate increase on a lower Depreciat
Slide 7: Headline Earnings – 2016
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 HEADLINE EARNINGS – 2016 R million 2016 2015 Comments Loss attributable to ordinary shareholders (1 908) (1 426) Adjusted for: Release of FCTR due to disposal of coal Foreign currency translation reserve (120) 2 trading business Profit on disposal of termi
Slide 8: Headline Earnings by Division
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 HEADLINE EARNINGS BY DIVISION 2016 2015 600 200 112 559 50 165 450 (100) (62) R million R million (250) 300 54 (400) 228 120 (460) (550) 171 150 (700) (689) (850) 0 Freight Shipping Financial Group Total Freight Shipping Financial Group Total Services Serv
Slide 9: Headline Earnings by Division H1 and H2 2016
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 HEADLINE EARNINGS BY DIVISION H1 2016 H2 2016 200 200 50 13 50 137 ( 100) (78) R million R million (100) (74) 94 ( 250) (250) (321) 77 ( 400) (400) (16) (381) (368) ( 550) (550) Freight Shipping Financial Group Total Freight Shipping Financial Group Total
Slide 10: Headline Earnings by Division Excluding Rail Business Held for Sale
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 HEADLINE EARNINGS BY DIVISION EXCLUDING RAIL BUSINESS HELD FOR SALE H1 2016 H2 2016 200 200 129 137 38 50 50 94 (60) ( 100) R million (100) R million (321) ( 250) (250) 77 (400) (16) (367) ( 400) (368) (550) ( 550) Freight Shipping Financial Group Total Fr
Slide 11: Management Balance Sheet
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 MANAGEMENT BALANCE SHEET R million 2016 2015 Comments Property, plant and equipment Transfer to non-current assets held Freight Services 2 709 4 118 for sale Ships delivered offset by lower Shipping 6 557 7 943 exchange rate and impairment of ships marked
Slide 12: Net Debt Analysis
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 NET DEBT ANALYSIS 492 500 (64) 350 200 34 50 ( 100) R million ( 250) (677) 592 ( 400) (106) (373) ( 550) ( 700) ( 850) (1 000) (644) (1 150) Dec 2015 Cash generated Interest/ Investments Bank investment Loans to joint Proceeds on Dec 2016 from operations d
Slide 13: Capital Commitments and Expenditure
FINANCIAL + FREIGHT + SHIPPING RESULTS 2016 CAPITAL COMMITMENTS AND EXPENDITURE Capital expenditure Capital commitments Split as follows Approved Approved R million 2016 2017 2018 2019+ Total not contracted and contracted Freight Services 350 617 30 6 653 359 294 Port and Terminals 120 178 6 – 184 5
Slide 14: Markets
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS
Slide 15: Dry-Bulk Seaborne Trade
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS DRY-BULK SEABORNE TRADE GLOBAL SEABORNE TRADE GROWTH CAGR* 2012 to 2015 CAGR* 2016f to 2018f 6 000 3.6% 1.5% + 155mt per annum + 70mt per annum 5 000 4 000 Million tonnes 3 000 Global seaborne trade expanded rapidly from 2012 to 2015, adding over 155
Slide 16: Shipping: Capesize Bulk Carriers
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS SHIPPING No of ships Mdwt Fleet (1 Jan 2017) 1 652 315.1 CAPESIZE BULK CARRIERS (100 000+ dwt tonnes) Total order book (1 Jan 2017) 165 40.5 Order book % of fleet 10 13 % of fleet over 25 years 2 2 Est. % non-delivery in 2016* 44 45 350 Fleet growth %
Slide 17: Shipping: Handymax Bulk Carriers
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS SHIPPING No of ships Mdwt Fleet (1 Jan 2017) 3 446 188.5 HANDYMAX BULK CARRIERS (40 – 64 999 dwt tonnes) Total order book (1 Jan 2017) 324 19.6 Order book % of fleet 9 10 % of fleet over 25 years 3 2 Est. % non-delivery in 2016* 52 52 500 Fleet growth
Slide 18: Shipping: Handysize Bulk Carriers
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS SHIPPING No of ships Mdwt Fleet (1 Jan 2017) 3 320 94.0 HANDYSIZE BULK CARRIERS (10 – 39 999 dwt tonnes) Total order book (1 Jan 2017) 277 9.9 Order book % of fleet 8 11 % of fleet over 25 years 9 7 Est. % non-delivery in 2016* 51 49 500 Fleet growth
Slide 19: Shipping: Product Tanker Demand
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS SHIPPING PRODUCT TANKER DEMAND 16 14 12 10 8 % change 6 4 2 0 (2) (4) (6) (8) 2009 2010 2011 2012 2013 2014 2015 2016e 2017e MR demand MR fleet World liquid fuel consumption e = estimate Source: Affinity (Shipping) Limited, January 2017 GRINDROD LIMIT
Slide 20: Shipping: Medium-Range Products Tankers
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS SHIPPING No of ships Mdwt Fleet (1 Jan 2017) 1 911 86.0 MEDIUM-RANGE PRODUCTS TANKERS (25 – 54 999 dwt tonnes) Total order book (1 Jan 2017) 150 7.1 Order book % of fleet 8 8 % of fleet over 25 years 4 3 Est. % non-delivery in 2016* 27 25 250 Fleet gr
Slide 21: Shipping: Small Products and Chemical Tankers
FINANCIAL + FREIGHT + SHIPPING FINANCIAL MARKETS SHIPPING No of ships Mdwt Fleet (1 Jan 2017) 609 11.0 SMALL PRODUCTS AND CHEMICAL TANKERS (15 – 19 999 dwt tonnes) Total order book (1 Jan 2017) 65 1.2 Order book % of fleet 11 11 % of fleet over 25 years 6 6 90 Est. % non-delivery in 2016* 38 36 Flee
Slide 22: Operational Overview: Freight Services
FINANCIAL + FREIGHT + SHIPPING OPERATIONAL OVERVIEW FREIGHT SERVICES
Slide 23: Freight Services – Port and Terminals
FINANCIAL + FREIGHT + SHIPPING FREIGHT SERVICES – PORT AND TERMINALS OPERATIONAL HIGHLIGHTS • Maputo Port channel dredge from 11 to 14.2 metres complete. MV Mineral Belgium loaded 90 000 tonnes of chrome ore in December 2016 • Matola Terminal berth deepening completed and quay offset to be completed
Slide 24: Freight Services – Rail
FINANCIAL + FREIGHT + SHIPPING FREIGHT SERVICES – RAIL OPERATIONAL HIGHLIGHTS • No material new contracts concluded in the Rail Assembly businesses • Exit of locomotives assembly, rail signalling technology and construction in progress • Further impairment of R644 million in Rail businesses in the s
Slide 25: Freight Services – Logistics
FINANCIAL + FREIGHT + SHIPPING FREIGHT SERVICES – LOGISTICS OPERATIONAL HIGHLIGHTS • Carrier Logistics – Auto business impacted by low volumes – Fuel business restructure complete, exited unprofitable fuel business in Mozambique • Ships agency and clearing and forwarding businesses held up well desp
Slide 26: Freight Services Strategy and Outlook
FINANCIAL + FREIGHT + SHIPPING FREIGHT SERVICES STRATEGY AND OUTLOOK STRATEGY OUTLOOK • Ports: Expand Maputo port and align rail services • Maputo port volumes increasing on back of dredge and improved commodity markets • Terminals: Complete TCM berth offset project • Terminal volume improvement wit
Slide 27: Operational Overview: Shipping
FINANCIAL + FREIGHT + SHIPPING OPERATIONAL OVERVIEW SHIPPING
Slide 28: Shipping Operational Highlights
FINANCIAL + FREIGHT + SHIPPING SHIPPING OPERATIONAL HIGHLIGHTS • Rates in the tanker sector were high in H1 2016 but reduced substantially during the second half • Rates in the dry-bulk sector recovered from their historic lowest levels Q1 2016 • 11 handysize and four supramax third-party owned vess
Slide 29: Shipping Strategy and Outlook
FINANCIAL + FREIGHT + SHIPPING SHIPPING STRATEGY AND OUTLOOK STRATEGY OUTLOOK • Low-cost owner operator • Dry-bulk fleet continues to move toward a balanced position leading to improvement in rates • Retain the sector and size focus in which IVS and Unicorn have expertise • Tankers will experience h
Slide 30: Operational Overview: Financial Services
FINANCIAL + FREIGHT + SHIPPING OPERATIONAL OVERVIEW FINANCIAL SERVICES
Slide 31: Financial Services Operational Highlights
FINANCIAL + FREIGHT + SHIPPING FINANCIAL SERVICES OPERATIONAL HIGHLIGHTS • Above target earnings in both the Bank and Asset Management • Private equity investment continues to increase • Retail SASSA - Grant payments continue to be efficiently managed - Over 1 000 ATMs deployed • Assets under manage
Slide 32: Financial Services Strategy and Outlook
FINANCIAL + FREIGHT + SHIPPING FINANCIAL SERVICES STRATEGY AND OUTLOOK STRATEGY OUTLOOK • Drive focused business growth • Steady growth expected • Pursue growth in assets under management through • Volatile stock market could impact asset Coreshares and Bridge Asset Management management fees • Secu
Slide 33: Capital Projects Update
FINANCIAL + FREIGHT + SHIPPING CAPITAL PROJECTS UPDATE
Slide 34: Capital Projects Update
FINANCIAL + FREIGHT + SHIPPING CAPITAL PROJECTS UPDATE • Ngqura liquid-bulk terminal – BOOT agreement signed with Transnet in December 2016 • Maputo Port channel dredging completed in January 2017 • Matola Bulk Terminal berth deepening and quay offset project started in July 2016 - Completion expect
Slide 35: Group Strategy and Outlook
FINANCIAL + FREIGHT + SHIPPING GROUP STRATEGY AND OUTLOOK
Slide 36: Group Strategy and Outlook
FINANCIAL + FREIGHT + SHIPPING GROUP STRATEGY AND OUTLOOK STRATEGY OUTLOOK • To grow the business organically, by acquisition and • Demand for commodities globally is a key driver of seeking synergies within the group, with specific the Grindrod business model focus on Africa, to further our integra
Slide 37: Annexures
FINANCIAL + FREIGHT + SHIPPING ANNEXURES
Slide 38: Terminal Capacity – Utilisation as at December 2016
FINANCIAL + FREIGHT + SHIPPING ANNEXURES TERMINAL CAPACITY – UTILISATION AS AT 31 DECEMBER 2016 Annual H1 H2 Change Total Total Change capacity Terminals 2016 2016 % 2016 2015 % 2016 Dry bulk (tonnes) 3 091 470 5 255 137 70 8 346 607 7 349 946 14 15 150 000 Matola Coal Terminal1 1 091 143 2 694 775
Slide 39: Scrapping
FINANCIAL + FREIGHT + SHIPPING ANNEXURES SCRAPPING Handy* Handy* Handysize Handymax Panamax Capesize products chemical All other Total dwt 000 bulker bulker bulker bulker tanker tanker Total types scrapping 2010 2 700 400 700 2 700 3 200 1 400 11 100 16 900 28 000 2011 5 300 2 200 5 200 10 500 1 400
Slide 40: 2015/16 Shipping and Commodity Price Performance
FINANCIAL + FREIGHT + SHIPPING ANNEXURES 2015/16 SHIPPING AND COMMODITY PRICE PERFORMANCE Prices for the period January 2016 – December 2016 Open Close % BDI Index 473 961 103 Increase Iron ore 44 79 78 Increase Thermal coal 48 84 75 Increase Copper 209 251 20 Increase 180 160 140 120 Index (Jan 201
Slide 41: Dry-Bulk Daily Spot Rates (Baltic Indices)
FINANCIAL + FREIGHT + SHIPPING ANNEXURES DRY-BULK DAILY SPOT RATES (BALTIC INDICES) 50 000 2 000 1 800 40 000 1 600 1 400 Index points US$ per day 30 000 1 200 1 000 20 000 800 600 10 000 400 200 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2012 2013 2014 2015 2016 2017 Baltic
Slide 42: Disclaimer
FINANCIAL + FREIGHT + SHIPPING DISCLAIMER Statements contained throughout this presentation regarding the prospects of the group have not been reviewed or reported on by the group's external auditors. The information supplied herein is believed to be correct but the accuracy thereof is not guarantee
Slide 43: www.grindrod.com GRINDROD LIMITED FINANCIAL + FREIGHT + SHIPPING
www.grindrod.com GRINDROD LIMITED FINANCIAL + FREIGHT + SHIPPING