Ardmore Shipping Corporation · NYSE:ASC
Ardmore Shipping — Q1 2022 Earnings Presentation
24 slides from Ardmore Shipping's earnings presentation, May 4, 2022
Slide 1: Earnings Presentation First Quarter 2022
Earnings Presentation First Quarter 2022
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: First Quarter 2022 3 Agenda ▪ Highlights ▪ Recent Market Developments ▪ Product and Chemical Tanker Fundamentals ▪ Financial Performance ▪ Summary 3
Slide 4: Highlights
Highlights 4 ▪ Over the past two months the product and chemical tanker market has changed completely; 1Q22 was only partially impacted by these conditions but 2Q22 will show the full effect ▪ Ardmore’s MR TCE for 1Q22 averaged $15,600 / day, whereas for 2Q22 with 50% fixed the result so far is $25,
Slide 5: Recent Market Developments
Recent Market Developments 5 Supply Dislocation = Longer Voyages ▪ On our last call, we discussed improving fundamentals offset by adverse oil market dynamics. Since then, the oil market has turbo-charged the product tanker sector and MRs in particular ▪ The market is now characterized by dislocatio
Slide 6: Ardmore Product and Chemical Tanker Rates
Ardmore Product and Chemical Tanker Rates(1) 6 FLEET AVERAGE TCE MR ECO-DES CHEMICAL(2) $25,500 $24,000 $19,500 $15,850 $15,155 $14,801 $13,964 $12,737 $12,217 $11,349 $11,796 $11,390 $11,540 $11,805 $11,614 $13,645 $11,051 $10,319 $11,944 $12,308 $11,274 $8,916 $8,400 Capital Adjusted TCE 1Q21 2Q21
Slide 7: Ardmore Has Significant Operating Leverage (Illustrative)
Ardmore Has Significant Operating Leverage (Illustrative) 7 Average Fleet TCE $145.2 $5.0 $150 2Q22 (to date) $125.8 $4.20 $4.0 $3.64 $120 $106.5 $3.08 $88.0 $3.0 $90 $2.52 $67.8 Net Income (mm) $1.96 $2.0 $60 $48.4 $1.40 EPS $29.0 $1.0 $0.84 $30 $9.7 $0.28 $0.00 $0.0 - - ($0.56) ($1.0) ($19.4) ($30
Slide 8: Product and Chemical Tanker Fundamentals
Product and Chemical Tanker Fundamentals 8 8
Slide 9: Demand Fundamentals
Demand Fundamentals 9 ▪ Demand outlook for product and chemical tankers is very positive driven by Oil Demand: Continued Growth to 2026(1) increased refinery throughput and oil market disruption in the near-term and 110 continued oil demand growth and refinery dislocation over the medium-term 103.2
Slide 10: Supply Fundamentals
Supply Fundamentals 10 ▪ Supply outlook for product and chemical tankers is very favorable, driven Product and Chemical Tanker Estimated Net Fleet Growth(1)(2)(4) by a low orderbook and increased scrapping levels 4.5% 3.9% 4.0% ▪ Net fleet growth (deliveries less scrapping) is expected to be well be
Slide 11: Financial Performance
Financial Performance 11 11
Slide 12: Financial Highlights
Financial Highlights INCOME STATEMENT DATA Three Months Ended ▪ Reporting an adjusted loss(1) of $0.9 million, or $0.03 per share for 1Q22 US$ millions, unless otherwise representing a significant improved y-o-y stated Mar 31, 2022 Mar 31, 2021 Adjusted EBITDA(1) $12.5 $4.5 ▪ MRs averaged $15,600 /
Slide 13: Fleet and Operational Highlights
Fleet and Operational Highlights ▪ Continuing to invest in the fleet to optimize operating performance: Capex Schedule: Drydocking and BWTS(1) $4.0 o Expect to complete two drydockings and two ballast water treatment $3.5 $3.2 Total Capex (Million USD) system installations later this year with capex
Slide 14: Capital Allocation and Balance Sheet
Capital Allocation and Balance Sheet 14 ▪ Capital allocation policy prioritizes financial strength; with a sustained Balance Sheet Summary strong charter market we may be able to rapidly meet our financial US$ millions, unless otherwise stated Mar 31, 2022 Dec 31, 2021 targets while also evaluate ot
Slide 15: Summary
Summary 15 15
Slide 16: Summary
Summary 16 ▪ Since our last call the market environment has changed completely as a consequence of the war and its impact on the oil market, for which there is no clear end in sight ▪ Even after the cessation of hostilities we believe the dislocations it has caused will persist until sanctions have
Slide 17: Appendix
Appendix 17 17
Slide 18: Refinery Dislocation Boosting Tonne-Mile Demand
Refinery Dislocation Boosting Tonne-Mile Demand(1)(2) 18 (3) 1. See slide 19 for illustrative tonne-mile impact of refinery dislocation 2. See slide 22 for further detail on refineries 3. Closures based on announcement periods; some closures to physically happen in 2023 18
Slide 19: Impact of Refinery Dislocation
Impact of Refinery Dislocation 19 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 o
Slide 20: Fleet Profile
Fleet Profile High Quality Vessels Vessel Name Type Dwt Tonnes IMO Built Country Flag Specification Ardmore Seavaliant Product/Chemical 49,998 2/3 Feb-13 Korea MI Eco-Design ✓ Modern, highly fuel-efficient fleet Ardmore Seaventure Product/Chemical 49,998 2/3 Jun-13 Korea MI Eco-Design of MRs is well
Slide 21: Supplementary Industry Data
Supplementary Industry Data 21 21
Slide 22: Refinery Summary and Seaborne Product Trade
Refinery Summary and Seaborne Product Trade 22 Regional Refinery Shift(1) Region Closures 2020 - 2023 Openings 2022 - 2026 Europe 1.2 0.1 Australia 0.5 - Middle East - 0.9 Africa 0.3 0.9 America 1.6 - China 0.7 1.0 Asia (excl. China) 1.6 5.6 Total (mbd) 5.9 8.5 Seaborne Product Trade Balances(2) 202
Slide 23: Refinery Development Details
Refinery Development Details 23 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) Lianyungang Opened China 2021 3
Slide 24: Supply Growth Remains Constrained
Supply Growth Remains Constrained Chemical Tanker Orderbook(1)(2) Product Tanker Scrapping in 2022(1) 40 80% 80 7.5% 68 35 70% 70 65 58 30 60% 60 53 50 Orderbook as % Fleet 25 50% 50 Fleet (million DWT) 39 20 40% 40 34 15 30% 30 27 21 23 20 10 20% 20 5 10% 10 - - - 1996 1998 2000 2002 2004 2006 2008