Genco Shipping & Trading Limited · NYSE:GNK
Genco Shipping & Trading — Q4 2020 Earnings Presentation
32 slides from Genco Shipping & Trading's earnings presentation, Feb 25, 2021
Slide 1: Q4 2020 Earnings Presentation
Genco Shipping & Trading Limited Q4 2020 Earnings Presentation February 25th, 2021
Slide 2: Forward Looking Statements
Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use word
Slide 3: Agenda
Agenda ◼ Fourth Quarter 2020 and Year-to-Date Highlights ◼ Financial Overview ◼ Industry Overview 3
Slide 4: Fourth Quarter 2020 and Year-to-Date Highlights
Fourth Quarter 2020 and Year-to-Date Highlights
Slide 5: Fourth Quarter 2020 and YTD Update
Fourth Quarter 2020 and YTD Update Q4 2020 financial performance ◼ Cash position: $179.7 million, including $35.5 million of restricted cash related to vessel sales ◼ Adjusted net income of $9.3 million, basic and diluted earnings per share of $0.22 (excluding $74.2 million non-cash impairment of ve
Slide 6: Genco's commercial platform continues to outperform benchmarks
Genco’s commercial platform continues to outperform benchmarks Genco’s major and minor bulk FY 2020 TCE performance vs benchmark* Incremental net revenue due to $17,500 +$15m fleet-wide outperformance $15,000 $12,500 TCE Benchmark On a scrubber- +$811 adjusted basis* $10,000 $7,500 $14,977 $5,000 $1
Slide 7: 3-year track record of Ultra/Supra benchmark outperformance
3-year track record of Ultra/Supra benchmark outperformance Ultra / Supra TCE outperformance - incremental TCE per day $1,750 TCE benchmark outperformance ($/day) Incremental $7.5m $5.4m $11.2m earnings ($ in m) $1,500 $1,250 $1,000 $750 $1,249 $500 $774 $250 $599 $0 2018 2019 2020 ◼ Following the c
Slide 8: FY 2020 TCE highlights significant 2H improvement
FY 2020 TCE highlights significant 2H improvement Our vessel deployment strategy remains weighted towards short-term fixtures which provides us with optionality on our sizeable fleet +71% +15% $20 Major Bulk $17.5 $16.7 $16.3 Minor Bulk $15 Fleet-Wide $13.2 TCE ($ in 000s) $11.5 $10.8 $9.8 $9.5 $10
Slide 9: Fleet-wide operating leverage
Fleet-wide operating leverage $300 Every $1,000 increase in TCE is ~$14m of incremental Illustrative net revenue ($ in m) $14m $250 annualized EBITDA on our 39-vessel fleet $200 $150 $100 For our 17 Capesizes specifically, every $5,000 increase in $50 $31m TCE is ~$31m of incremental annualized EBIT
Slide 10: Fleet renewal program: divestiture portion complete
Fleet renewal program: divestiture portion complete Genco’s pro forma fleet composition (based on sale and purchase activity from 2018 to date) 25 Base Fleet Bought Sold 20 5 # of Vessels 15 4 10 17 16 13 5 8 6 - Cape Pana Ultra/Supra 53s Hmax/Hsize ◼ Fleet composition strategy: “barbell” approach t
Slide 11: GNK stock performance
GNK stock performance GNK’s large shareholders’ % ownership* $12 Prior to 58% recent sales* 32% Current* $10 $8 $6 GNK large $4 shareholders began selling on $2 Dec 11, 2020 $- Since Dec 11, 2020: GNK share price has lagged the peer group of listed drybulk shipping companies during a time in which s
Slide 12: Financial Overview
Financial Overview
Slide 13: Fourth Quarter Earnings
Fourth Quarter Earnings Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 (Dollars in thousands, except share and per share data) (Dollars in thousands, except share and per share data) (unaudited) (u
Slide 14: December 31, 2020 Balance Sheet
December 31, 2020 Balance Sheet December 31, 2020 December 31, 2019 (Dollars in thousands) (unaudited) BALANCE SHEET DATA: Cash (including restricted cash) $ 179,679 $ 162,249 Current assets 247,202 223,195 Total assets 1,232,809 1,528,892 Current liabilities (excluding current portion of long-term
Slide 15: Fourth Quarter Highlights
Fourth Quarter Highlights Three Months Ended Twelve Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 (unaudited) (unaudited) FLEET DATA: Total number of vessels at end of period 47 55 47 55 Average number of vessels (1) 48.5 56.1 51.8 57.6 Total ownership days for
Slide 16: Genco's industry leading balance sheet
Genco’s industry leading balance sheet Key balance sheet items as of December 31, 2020 Cash1 Debt2 Net Debt3 $179.7 million $449.2 million $269.5 million ◼ Strong financial position: Genco continues to maintain one of the highest liquidity positions and lowest leverage profiles among our drybulk pee
Slide 17: Estimated Q1 2021 Net Income Breakeven Rate
Estimated Q1 2021 Net Income Breakeven Rate(1) Fleet breakeven rate – estimated Q1 2021 $16,000 (Detailed Q1 2021 estimated b/e rates in appendix) $14,000 $ per vessel per day $12,000 $10,000 $3,361 $8,000 $361 $1,156 $6,000 $1,372 $11,350 $4,000 $5,100 $2,000 $0 DVOE G&A Mgmt Fees Interest Expense
Slide 18: Industry Overview
Industry Overview
Slide 19: Freight rates have started 2021 off strong
$- $- $2,500 $5,000 $7,500 $10,000 $12,500 $15,000 $17,500 $20,000 $22,500 $25,000 $5,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 $10,000 02-Jan 02-Jan Source: Baltic Exchange 09-Jan 09-Jan 16-Jan 16-Jan 23-Jan 23-Jan 30-Jan 30-Jan 06-Feb 06-Feb 13-Feb 13-Feb 20-Feb 20-Feb 27-Feb 27-Feb 05-M
Slide 20: Brazilian iron ore exports have recovered
Brazilian iron ore exports have recovered… …following poor weather conditions and operational challenges that disrupted production and shipments during most of 1H 2020 ◼ Brazilian iron ore exports have exceeded 30MT in 6 out of the last 8 months ― January 2021 exports rose by over 8% YOY ◼ Vale has
Slide 21: China's record IO imports led by all-time high steel output
China’s record IO imports led by all-time high steel output China’s IO imports rose by 9% YOY in 2020… 120 2017 2018 110 2019 2020 100 90 80 70 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec …as China’s steel output continues to set records and gain global market share 100 2017 2018 90 2019 2020 80
Slide 22: China coal and steel inventories and trade flows
110 40 50 70 90 100 60 80 10 15 20 25 30 - 5 Jan-18 Jan-18 Feb-18 Feb-18 Mar-18 Mar-18 Apr-18 Apr-18 May-18 May-18 Jun-18 Jun-18 Jul-18 Jul-18 Aug-18 Source: Commodore Research Aug-18 Sep-18 Sep-18 Oct-18 Oct-18 Nov-18 Nov-18 Dec-18 Dec-18 Jan-19 Jan-19 Feb-19 Feb-19 Mar-19 Mar-19 Apr-19 Apr-19 May-
Slide 23: Strong grain trade + improvement in other minor bulk trades
Strong grain trade + improvement in other minor bulk trades China’s soybean imports 110 100 90 80 Black Sea – US – Q4 peak season Aug peak season China Firm exports have Ramping up carried into Q1 to date soybean imports following recovery in demand from the swine flu Brazil – Q2 to Q3 peak season ◼
Slide 24: Supply side fundamentals
Supply side fundamentals Drybulk net fleet growth 120 18% Deliveries Scrapping Net fleet growth 16% 100 14% Net fleet growth % 80 12% 10% mdwt 60 8% 40 6% 4% 20 2% 0 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Current drybulk newbuilding orderbook (as a % of the fleet) 2.0% Orderbook a
Slide 25: Freight rate catalysts for 2021
Freight rate catalysts for 2021 We believe 2021 will be an improved year for the drybulk market relative to 2020 due to the following factors… 1 Record low orderbook as a percentage of the fleet to limit net fleet growth 2 Unprecedented levels of global stimulus – global GDP forecast to rise by 5% i
Slide 26: Q&A
Q&A
Slide 27: Appendix
Appendix
Slide 28: Genco pro forma fleet list
Genco pro forma fleet list Major Bulk Minor Bulk Vessel Name Year Built Dwt Vessel Name Year Built Dwt Vessel Name Year Built Dwt Capesize Ultramax Genco Rhone 2011 58,018 Genco Resolute 2015 181,060 Baltic Hornet 2014 63,574 Genco Aquitaine 2009 57,981 Genco Endeavour 2015 181,060 Genco Freedom 201
Slide 29: Time Charter Equivalent Reconciliation
Time Charter Equivalent Reconciliation(1) Three Months Ended Twelve Months Ended December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 (unaudited) (unaudited) Total Fleet Voyage revenues (in thousands) $ 95,495 $ 108,705 $ 355,560 $ 389,496 Voyage expenses (in thousands) 33,435 45,
Slide 30: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation Three Months Ended December 31, 2020 Adjusted Net Income Reconciliation (unaudited) Net loss $ (65,921) + Impairment of vessel assets 74,225 + Loss on sale of vessels 1,012 Adjusted net income $ 9,316 Adjusted net earnings per share - basic $ 0.22 Adjusted net earn
Slide 31: Q1 2021 Genco Estimated Breakeven Rates
Q1 2021 Genco Estimated Breakeven Rates(1) Daily Expenses by Category Free Cash Flow(2) Net Income Direct Vessel Operating(3) $5,100 $5,100 General and Administrative 1,287 1,372 Expenses(4) Technical Management Fees(5) 361 361 Drydocking(6) 237 - Interest Expense(7) 906 1,156 Fixed Debt Repayments(
Slide 32: Thank you
Thank you
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