Wallenius Wilhelmsen Asa · OSL:WAWI
Wallenius Wilhelmsen Asa — Debt Investor Presentation (August 2020)
50 slides from Wallenius Wilhelmsen Asa's debt investor presentation, August 2020
Slide 1: Bond investor presentation August 2020
Wallenius Wilhelmsen Bond investor presentation August 2020 Sustainable logistics for a world in motion
Slide 2: Disclaimer (I/III)
Disclaimer (I/III) This presentation (the “Presentation”) has been prepared by Wallenius Wilhelmsen ASA (“Wallenius Wilhelmsen ASA” or the “Company” and together with its subsidiaries the “Group”) with assistance of Danske Bank, Norwegian Branch, DNB Markets, a part of DNB Bank ASA, Nordea Bank Abp,
Slide 3: Disclaimer (II/III)
Disclaimer (II/III) The information included in this Presentation may contain certain forward-looking statements relating to the business, financial performance and results of the Group and/or the industry in which it operates. Forward-looking statements concern future circumstances and results and
Slide 4: Disclaimer (III/III)
Disclaimer (III/III) Neither the Group nor the Managers have taken any actions to allow the distribution of this Presentation in any jurisdiction where action would be required for such purposes. The distribution of this Presentation and any purchase of or application/subscription for Bonds may be r
Slide 5: Summary of risk factors (I/II)
Summary of risk factors (I/II) The following sets out a summary of key risks facing the Company. Please see pages 37-43 for a full description of the risk factors. Risks related to the Group and the market in which it operates ▪ Risks related to the recent outbreak of Covid-19 ▪ Risk related to chan
Slide 6: Summary of risk factors (II/II)
Summary of risk factors (II/II) Risks related to the Bonds and the Bond Issue (continued) ▪ The Bonds will be structurally subordinated to the liabilities of the Issuer's subsidiaries ▪ The insolvency laws of Norway may not be as favourable to you as insolvency laws in other jurisdictions with which
Slide 7: Investment highlights
Investment highlights Global market leader in the vehicle logistics segment Diversified business model with both Ocean and Landbased logistics Diversified and solid customer base with long-term contracts Historically resilient free cash flow mainly applied towards reducing debt Proven track record o
Slide 8: Agenda
Agenda Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook
Slide 9: Wallenius and Wilhelmsen – a history of innovation and adaptation
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Wallenius and Wilhelmsen – a history of innovation and adaptation Wilhelmsen Group American Roll-on Roll-off EUKOR formed as Wilhelmsen Merger to create Wallenius Wilhelmsen Logistics Founded in Tons
Slide 10: A fully integrated service provider throughout the lifecycle
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook A fully integrated service provider throughout the lifecycle VALUE CHAIN AND PRODUCT OFFERING Landbased - Upstream Ocean Landbased - Downstream 3 2 1 1 2 3 DISTRIBUTION PLANT-BASED MARINE TERMINAL OC
Slide 11: Ocean segment benefits from a diversified customer portfolio with long-term contracts
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Ocean segment benefits from a diversified customer portfolio with long- term contracts CARGO SEGMENTS AUTO HIGH & HEAVY AND BREAKBULK ▪ Majority of volumes from auto ▪ High & heavy (“H&H”) and breakb
Slide 12: The clear market leader and the #1 operator globally for the Ocean segment
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook The clear market leader and the #1 operator globally for the Ocean segment Four decades of leading the High & Heavy space CURRENT FLEET BY OPERATOR GROUP FLEET CHARACTERISTICS Total capacity, CEU1) A
Slide 13: Broad landbased services portfolio, with extensive and growing footprint
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Broad landbased services portfolio, with extensive and growing footprint MARINE TERMINALS TECHNICAL SERVICES INLAND DISTRIBUTION MAIN CUSTOMERS AUTO HIGH & HEAVY Share of EBITDA* Services Share of EB
Slide 14: Sustainable Logistics for a world in motion
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Sustainable Logistics for a world in motion An agile approach to creating and taking opportunities 1 2 3 4 ▪ Syngin on-line vehicle ▪ 100 MUSD efficiency ▪ wPCTC vessel concept ▪ iToms visibility and
Slide 15: What is good for the environment is also good for business
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook What is good for the environment is also good for business AIM TO STAY AHEAD OF EMERGING REQUIREMENTS AND PREPARING FOR FUTURE RISKS WHILE CREATING LONG-TERM VALUE FOR EMPLOYEES, CUSTOMERS, INVESTORS
Slide 16: Continued focus on driving sustainability – a journey to zero
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Continued focus on driving sustainability – a journey to zero DAY TO DAY ADVANCED WEATHER NOVEL BIO-FOULING DIGITALISATION OF FLEET ROUTING MANAGEMENT TECHNIQUES Gradual and continuous reduction in e
Slide 17: Agenda
Agenda Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook
Slide 18: Highlights second quarter 2020
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Highlights second quarter 2020 ▪ Adjusted EBITDA of USD 104 million, volumes and income for the group highly impacted by impact of Covid-19 pandemic ▪ Earnings balanced by effective cost control, hig
Slide 19: Ocean volumes declined 45% y-o-y in the second quarter
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Ocean volumes declined 45% y-o-y in the second quarter Largest decline for Auto VOLUME AND CARGO MIX DEVELOPMENT1,2 COMMENTS Million CBM and % High&heavy share, unprorated Prorated volumes ▪ Unprorat
Slide 20: Managing costs
Wallenius Wilhelmsen in brief Business and operational update Financial update Market overview Outlook Managing costs Measures underway with up to USD 210 million impact on cash in 2020 Sticky revenue base Low operational leverage Flexibility to adapt quickly ▪ Rates are fixed for the contract perio
Slide 21: Managing capacity
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Managing capacity Adjusting our fleet to meet demand RECYCLING FLEET DEVELOPMENT – VESSELS IN OPERATION ▪ 1 vessel recycled in Q2 # of vessels ▪ 1 vessel to be recycled in Q3 127 127 126 ▪ 2 vessels
Slide 22: ARC wins GHC contract with TRANSCOM
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook ARC wins GHC contract with TRANSCOM ▪ Announced 30 April 2020 ▪ Revenues of more than USD 2.0 billion per year as of 2022 ▪ Margins for first 24 months in range 0-2%, improving over time ▪ Expected t
Slide 23: Agenda
Agenda Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook
Slide 24: Group consolidated results
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Group consolidated results TOTAL INCOME ADJUSTED EBITDA COMMENTS USD million USD million ▪ FY2019 adj. EBITDA of USD 837m, up from 2018 4 065 837 despite 6% y-o-y decline in Ocean volume which 3 909
Slide 25: Historically resilient free cash flow generation, mainly applied towards reducing debt
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Historically resilient free cash flow generation, mainly applied towards reducing debt FREE CASH FLOW1,2 NET DEBT REPAYMENT (DEBT UPTAKE LESS DEBT REPAYMENT)2 USD million IFRS16 impact USD million IF
Slide 26: Solid balance sheet and strong liquidity position
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Solid balance sheet and strong liquidity position COMMENTS BALANCE SHEET 30.06.2020 LIQUIDITY POSITION 30.06.2020 USD billion USD million ▪ Equity ratio 34.4% ▪ Net debt at USD 3.4bn Assets Equity &
Slide 27: Access to broad range of capital sources. Support secured from banks
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Access to broad range of capital sources. Support secured from banks to manage through covid-19 impact COMMENTS GROUP NIBD 30.06.20 MATURITY PROFILE USD million USD million ▪ Supportive and diverse g
Slide 28: Financing and covenants primarily on business unit level
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Financing and covenants primarily on business unit level Unit / segment Wallenius Wilhelmsen Typical covenants within the segment Limitation on ability to pledge assets Ocean Landbased Minimum liquid
Slide 29: Agenda
Agenda Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook
Slide 30: Deep sea share stable despite significant sales drop in 2020 caused by Covid19
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Deep sea share stable despite significant sales drop in 2020 caused by Covid19 Deepsea share Import Domestic Global LV markets update 100 -21.9% 96.6 20% LV Sales 94.3 95.0 95 93.7 92.9 IHS Markit as
Slide 31: Production dropped more than sales during Q2 and expected to catch up
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Production dropped more than sales during Q2 and expected to catch up Global LV sales and production quarterly walk, 2020 and 2021 figures compared to 2019 Production vs 2019 Stimulus, auto trend Com
Slide 32: H&H sales expected to rebound in 2021-22 after a sharp decline in 2020
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook H&H sales expected to rebound in 2021-22 after a sharp decline in 2020 GLOBAL H&H MARKETS UPDATE OEM ANALYST CONSENSUS SALES ESTIMATES1 MACHINE UTILIZATION UP Construction Mining Agriculture Machine
Slide 33: Deep sea fleet adjusting to the market situation
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Deep sea fleet adjusting to the market situation Increase in recycling Vessel age distribution Fleet and demand growth # vessels for seaborn LV and HH transport Percent 67 68 Growth y-o-y 62 60 20% 4
Slide 34: Agenda
Agenda Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook
Slide 35: Focus on employees, customers, and the future
Wallenius Wilhelmsen in brief Business and operational update Financial update Market update Outlook Focus on employees, customers, and the future We continue to manage what we can control and have a solid plan for working through these trying times ▪ Focus on safe return to normal for operations an
Slide 36: Risk factors
\ © Wallenius Wilhelmsen Risk factors
Slide 37: Risk factors (I/VII)
Risk factors (I/VII) An investment in the Bonds involves inherent risks. Prospective investors should carefully consider all information in this Presentation, including the risk factors set out below, before making an investment decision. This section addresses both general risks associated with the
Slide 38: Risk factors (II/VII)
Risk factors (II/VII) Risk related to change in production patterns The geographical pattern of production and sales of cars and rolling equipment may change going forward, because of, inter alia, restructuring in the industries, growing protectionism and currency concerns. A potential shift in the
Slide 39: Risk factors (III/VII)
Risk factors (III/VII) Environmental risk The activities of the Group are subject to environmental regulation pursuant to a variety of international conventions and state and municipal laws and regulations. Changes in regulations concerning emission of greenhouse gases is one such risk factor for th
Slide 40: Risk factors (IV/VII)
Risk factors (IV/VII) Financial risks related to the Group Currency risk The reporting currency for the Group is USD. The Group is exposed to currency risk on revenues and expenses incurred (transaction risk) and balance sheet items (translation risk) in currencies other than USD, including CNY, EUR
Slide 41: Risk factors (V/VII)
Risk factors (V/VII) Bunkers price risk The profitability and cash flow of the Group is influenced by the market price of bunker fuel, which is affected by numerous factors beyond the control of the Issuer. The price of fuel oil has historically been volatile. An increase in fuel prices may material
Slide 42: Risk factors (VI/VII)
Risk factors (VI/VII) The Bonds are effectively subordinated to the secured debt of the Issuer The Bonds will be the Issuer's direct senior unsecured obligations and will rank equal in right of payment (except as to claims preferred by operation of law) with all of its other existing and future seni
Slide 43: Risk factors (VII/VII)
Risk factors (VII/VII) Risks related to the market for the Bonds The Bonds are a new issue of securities with no established trading history. Even though the Group will apply for listing of the Bonds on Oslo Børs (or any other regulated market), no assurance can be made that the Bonds will be succes
Slide 44: Appendix
W Wallenius Wilhelmsen Appendix
Slide 45: The Wallenius Wilhelmsen group in numbers
The Wallenius Wilhelmsen group in numbers 7 million throughput 158 Formed April 2017 by Wilh. Wilhelmsen of Norway and Wallenius Lines of Sweden and building on a 158-year heritage 35% reduction in CO2 emissions per tonne-km from 2008 – 2019 11 of cars through 71 vehicle processing centres terminals
Slide 46: Continued focus on driving sustainability – a journey to zero
Continued focus on driving sustainability – a journey to zero APPROACH TAKE THE INITIATIVE TO PARTNER TO FIND TRANSPARENT AND VOCAL ENGAGE IN THE REGULATORY ATTRACT INNOVATORS TO POSITION FOR THE FUTURE LEAN:GREEN SOLUTIONS APPROACH PROCESS OUR INDUSTRY EXAMPLES ▪ Zero-emission concept ▪ Collaborati
Slide 47: Vehicle production restarting and meets current demand
Vehicle production restarting and meets current demand COVID-19 status update Auto Supply Temporary plant closures has taken place in all major regions, however today production has recovered and meet almost all demand Recovery seems be on track despite a stop-start rhythm prevents efficiency, slow
Slide 48: Deepsea share of LV sales high in NA and low in China
Deepsea share of LV sales high in NA and low in China LV deepsea volume pr region, volume and share of sales NA sales, domestic produced and import Eur sales, domestic produced and import China sales, domestic produced and import LV mill units 2019-2023, % share import LV mill units 2019-2023, % sha
Slide 49: Strong management team with +20 years industry experience
Strong management team with +20 years industry experience Wallenius Wilhelmsen Senior Management team Wallenius Wilhelmsen ASA Craig Jasienski President & CEO Anne Lise Hjelseth Per-Hermod Rasmussen Simon White Organisational development CFO Group Digital & IT & HR ARC EUKOR Wallenius Wilhelmsen Oce
Slide 50: Experienced Board of Directors with broad industry knowledge and presence
Experienced Board of Directors with broad industry knowledge and presence Independent Chair and four independent Board Members Wallenius Wilhelmsen Board of Directors Chair of the Board Vice chair of the Board Håkan Larsson Rune Bjerke ▪ Chair of the SteerCo for the WW ▪ Chairman of the Board, Vipps
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