Stolt-nielsen Limited · OSL:SNI
Stolt-nielsen — Q3 2018 Earnings Presentation
32 slides from Stolt-nielsen's earnings presentation, Oct 4, 2018
Slide 1: Third-Quarter 2018 Results Presentation
Third-Quarter 2018 Results Presentation October 4, 2018
Slide 2: Forward-Looking Statements
Forward-Looking Statements Included in this presentation are various “forward-looking statements”, including statements regarding the intent, opinion, belief or current expectations of the Company or its management with respect to, among other things, (i) goals and strategies, (ii) plans for new dev
Slide 3: Stolt-Nielsen Limited Representatives
Stolt-Nielsen Limited Representatives • Niels G. Stolt-Nielsen Chief Executive Officer • Jens F. Grüner-Hegge Chief Financial Officer Page 3
Slide 4: Agenda
Agenda • SNL 3Q18 Highlights – Stolt Tankers – Stolthaven Terminals – Stolt Tank Containers – Stolt Sea Farm – Stolt-Nielsen Gas • Financials • Q&A Page 4
Slide 5: Third-Quarter 2018 Highlights
Third-Quarter 2018 Highlights • SNL net profit of $3.0m after one-time loss of $12.9m resulting from an accounting reclassification related to the investment in Avance Gas Holdings Limited, compared with $9.5m in the prior quarter, which included one-time impairment losses of $11.8m • Stolt Tankers
Slide 6: SNL: 2Q18 to 3Q18 Net Profit Variance
SNL: 2Q18 to 3Q18 Net Profit Variance Figures in $US Millions Note: Net Profit attributable to equity holders of SNL Page 6
Slide 7: Stolt Tankers – Challenging Market Conditions
Stolt Tankers – Challenging Market Conditions $US Millions $US Millions REVENUE GROSS PROFIT 350 60 280 45 210 30 54.1 299.7 295.1 308.6 312.4 48.9 140 282.8 40.7 42.0 15 34.4 70 0 0 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4Q17 1Q18 2Q18 3Q18 $US Millions Days OPERATING PROFIT STJS - OPERATING DAYS 40 7,000 3
Slide 8: Tankers: 2Q18 to 3Q18 Operating Profit Variance
Tankers: 2Q18 to 3Q18 Operating Profit Variance Figures in $US Millions Page 8
Slide 9: Stolt Tankers: Bunker Costs
Stolt Tankers: Bunker Costs Figures in $US Million $80.0 $500 Realised Unrealised Total Hedge $70.0 $450 Period G/(L) G/(L) G/(L) $400 Bunker cost ($US m) $60.0 FY17 7.4 6.1 13.5 IFO (USD/Tonne) $350 $50.0 $300 1Q18 2.8 (3.1) (0.3) $40.0 $250 2Q18 3.0 6.3 9.3 $63.0 $63.3 $65.4 $200 $30.0 $60.0 $57.4
Slide 10: 2020: Low Sulphur Fuel Change
2020: Low Sulphur Fuel Change • On January 1, 2020, all ships will have to consume low-sulphur fuel (0.5%, down from 3.5% today) • Fuel options are either 0.1% MGO or new 0.5% fuels (not on the market today; new fuels are unpriced and may give operating problems) • Ships can fit scrubbers to remove
Slide 11: Spot Rate vs. Bunker and TC Index Sensitivity
Spot Rate vs. Bunker and TC Index Sensitivity Stolt Tankers Joint Service Sailed-in T/C Index Source: Stolt-Nielsen and the Bureau of Labor Statistics (U.S. CPI) Net Impact on STJS Sailed-in T/C Index Sensitivity P&L per quarter Sailed-in T/C Index 3Q18 0.58 $0.0 • Rising bunker prices are putting p
Slide 12: Chemical Tanker Fleet and Orderbook – 3Q18
Chemical Tanker Fleet and Orderbook – 3Q18 20 3.0% DWT as % of toal current fleet 2.5% 16 2.0% Vessel Addition 12 1.5% 8 1.0% 4 0.5% 0 0.0% 4Q17 1Q18 2Q18 3Q18 4Q18 E 1Q19 E 2Q19 E 3Q19 E 4Q19 E Source: Stolt-Nielsen and Drewry, as of September 1, 2018 Competitor criteria: i) ship size between 15,00
Slide 13: Market Development
Market Development • Most markets remain subdued as tonnage SPECIALTY 1,000 MT 180 deliveries continue to outstrip demand growth 140 • Strong COA competition continued, with unpredictable spot market volumes leading 100 to extended waiting times to find cargo in 60 July/August for spot market operat
Slide 14: Stolthaven Terminals – Steadily Improving
Stolthaven Terminals – Steadily Improving $US Millions $US Millions REVENUE GROSS PROFIT • Revenue decreased by $1.3m 70 24 from last quarter driven 60 18 primarily by a decline in utility 12 21.3 18.8 22.0 22.2 22.2 revenue 61.4 62.5 63.9 62.6 50 61.0 • Utilisation for wholly owned 6 40 3Q17 4Q17 1
Slide 15: Terminals: 2Q18 to 3Q18 Operating Profit Variance
Terminals: 2Q18 to 3Q18 Operating Profit Variance Figures in $US Millions Page 15
Slide 16: Stolthaven Terminals: Market Update & Key Initiatives
Stolthaven Terminals: Market Update & Key Initiatives • Houston performing well, with increased revenue driven by higher utilisation rates, excess throughput and railcar activities; exports remain strong, but concerns growing over US/China tariffs • Singapore market remains challenging, but we achie
Slide 17: Stolt Tank Containers – Solid Performance
Stolt Tank Containers – Solid Performance $US Millions $US Millions REVENUE GROSS PROFIT 150 35 28 100 21 136.9 143.2 141.8 33.1 33.4 34.9 33.3 132.6 132.5 29.8 14 50 7 0 0 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4Q17 1Q18 2Q18 3Q18 $US Millions OPERATING PROFIT 35,000 SHIPMENTS - UTILISATION 100% 18 34,125 2
Slide 18: STC: 2Q18 to 3Q18 Operating Profit Variance
STC: 2Q18 to 3Q18 Operating Profit Variance Figures in $US Millions $17.7 ` Page 18
Slide 19: Stolt Tank Containers: Market Update and Key Initiatives
Stolt Tank Containers: Market Update and Key Initiatives • Reduced seasonal demand in the Shipments 140,000 quarter, driving down shipments by 4.2% and utilisation by 3.0% 130,000 • Operating revenues down 0.9% 120,000 from prior quarter 110,000 • Focus on systems development 100,000 and implementat
Slide 20: Stolt Sea Farm – Growing Demand
Stolt Sea Farm – Growing Demand $US Millions $US Millions REVENUE GROSS PROFIT a) 30 4 25 3 20 15 4.1 3.9 2 3.8 23.3 23.7 24.4 25.6 10 18.5 1 2.1 5 1.6 0 0 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4Q17 1Q18 2Q18 3Q18 $US Millions $US Millions OPERATING PROFIT/LOSS a) IFRS SEASONALITY 3 2.5 2 1.5 2.2 2.4 1 2.1
Slide 21: Stolt-Nielsen Gas – Avenir LNG Ltd
Stolt-Nielsen Gas – Avenir LNG Ltd • Avenir LNG’s vision is to become a leading provider of small-scale LNG for the power, bunkering, trucking and industrials markets through supplying LNG using Avenir’s LNG ships, storage terminals and containers • Avenir LNG is a JV between Stolt-Nielsen LNG (50%)
Slide 22: Financials
Financials Page 22
Slide 23: Net Profit
Net Profit Figures in $US Millions Quarter YTD 3Q18 2Q18 3Q17 2018 2017 Operating Profit (before one-offs) $54.6 $61.0 $55.8 $162.3 $162.4 Reversal of deferred tax liability at JV - - - 8.2 - Gain / (loss) on sale of assets 0.2 (0.7) 1.2 (0.5) (1.4) Jo Tankers integration costs - - (0.1) - (1.6) Imp
Slide 24: Balance Sheet
Balance Sheet Figures in $US Millions Period ended Figures in $US Millions (Except ratios) At the end of: Aug.31.18 Cash and cash equivalents $85 August 2018 Receivables 253 Other current assets 187 Debt $2,446 Total current assets 525 Tangible Net Worth (TNW) $1,623 Debt:TNW 1.51:1 Property, plant
Slide 25: Cash Flow
Cash Flow Figures in $US Millions Quarter Full Year 3Q18 2Q18 2017 Net profit $2 $10 $50 Depreciation, amortisation and non-cash items 83 67 259 Adjustment to deferred tax 0 0 0 Changes in working capital (5) 16 (10) Cashflow Priorities: Other receipts, net 19 (2) 26 Net cash generated by operating
Slide 26: EBITDA
EBITDA $US Millions $US Millions TANKERS TERMINALS 80 14% 40 14% 78 35 73 74 72 73 69 68 70 11% 35 11% 60 65 67 30 32 33 63 30 29 30 30 29 55 25 28 28 8% 8% 40 20 23 21 5% 15 5% 20 10 2% 2% 5 0 -1% 0 -1% 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3
Slide 27: Administrative & General Expenses
Administrative & General Expenses Figures in $US Millions Updated Quarterly Quarter YTD Guidance 3Q18 2Q18 3Q17 2018 2017 Stolt Tankers $21.5 $22.4 $22.1 $67.7 $67.1 $21.8 Stolthaven Terminals 11.0 10.9 11.1 33.4 32.1 11.1 Stolt Tank Containers 16.3 16.8 15.8 50.6 47.4 16.7 Stolt Sea Farm 1.7 1.7 1.
Slide 28: Depreciation and Amortisation
Depreciation and Amortisation Figures in $US Millions Updated Quarterly Quarter YTD Guidance 3Q18 2Q18 3Q17 2018 2017 Stolt Tankers $45.1 $44.8 $43.2 $134.1 $126.9 $44.0 Stolthaven Terminals 14.5 14.4 14.0 42.9 40.6 15.0 Stolt Tank Containers 6.1 6.2 6.6 18.4 19.9 6.9 Stolt Sea Farm 1.5 1.5 1.7 4.5
Slide 29: Share of Profit of JVs and Tax
Share of Profit of JVs and Tax Figures in $US Millions Share of Profit of JVs Updated Quarterly Quarter YTD Guidance 3Q18 2Q18 3Q17 2018 2017 Stolt Tankers $1.0 $1.2 $1.4 $2.6 $5.0 $2.0 Stolthaven Terminals 5.8 7.3 5.7 27.4 15.15 4.8 Tank Containers 0.6 0.5 0.4 1.2 0.85 0.5 Corporate and Other (0.5)
Slide 30: Capital Expenditures Programme
Capital Expenditures Programme Figures in USD Millions Figures in $US Millions Projected Actual Projections Total YTD Q3 Remaining 2018 2018 2019 2020 2021 2022 Stolt Tankers $17 $13 $41 $25 $6 $4 $90 Stolthaven Terminals 58 38 71 32 17 30 187 Stolt Tank Containers 11 14 2 - - - 16 Stolt Sea Farm 5
Slide 31: Debt Maturity Profile
Debt Maturity Profile Figures in $US Millions Note: • $355m drawn under the revolver as of August 31, 2018 Page 31
Slide 32: Key Takeaways
Key Takeaways • Established Avenir LNG Ltd, a JV with strong partners: Golar LNG Ltd and Höegh LNG Holdings Ltd; $182 million of committed equity capital • A net profit of $15.3m in the quarter, excluding the $12.9m one-off AGHL fair value adjustment loss • Tanker market remains challenging, with ex