Sfl Corporation Ltd · NYSE:SFL
Sfl — Ship Finance International — Q2 2009 Earnings Presentation
18 slides from Sfl's earnings presentation, Sep 29, 2009
Slide 1: Ship Finance International Limited 2Q 2009 results
Ship Finance International Limited 2Q 2009 results August 20, 2009
Slide 2: Forward Looking Statements
2 FORWARD LOOKING STATEMENTS This presentation contains forward looking statements. These statements are based upon various assumptions, many of which are based, in turn, upon further assumptions, including Ship Finance management's examination of historical operating trends, data contained in the C
Slide 3: 2Q 2009 Highlights
3 § Declared a quarterly dividend of $0.30 dividend per share • 10% dividend yield (1) • 22 consecutive quarters with dividend payments § $53.5m ($0.72/share) net income • Including gain on repurchase of bonds and non-cash asset impairment § $8.0m ($0.11/share) profit share accumulated in 2Q 2009 •
Slide 4: Bond buyback, impairment, rig and vessel sales
4 § Bought back one third of remaining 8.5% Senior Notes • Bonds with face value of $148m was repurchased at a 15.5% discount • Previously held by banks under TRS agreements with SFL • Recognized a non-recurring gain of $41.7m • Part-financed with $90m bank loans and $16.5m sale of equity § Non-cash
Slide 5: Dividend payment options
§ Dividends for 2Q 2009 to be paid in cash, or at the shareholder’s election, in stock § The stock dividend alternative • To be offered pursuant to a prospectus supplement to be filed with the SEC • Stock dividend to be based on market price prior to ex-dividend date, less a 5% discount § Our larges
Slide 6: ATM equity program
§ Utilized a part of the ‘At the market’ (ATM) equity program in 2Q 2009 • Approximately 1.4m shares issued and sold in the open market • Weighted average price of $12.24 per share • Approximately $16.5m in net proceeds, used to part-finance the repurchase of 8.5% Senior Notes § The Company has deci
Slide 7: Substantial charter backlog
7 § Nominal values (1) as per June 30, 2009 § Excluding any profit sharing § Virtually no exposure to escalating operating expenses Substantial charter backlog $7.4 bn ($95.6/share) Total charter payments $6.4 bn ($83.4/share) Net cash flow from charters (2) 13.1 years Average term of charters (3) (
Slide 8: SFL operational performance
8 § Pro-forma illustration of cash flow (1) • Not as accounted for under US GAAP • Used as an internal guideline to assess the Company’s performance • Excluding extraordinary and non-cash items 2Q 2009 1Q 2009 Change $ mill. $/share (2 ) $ mill. $/share ( 2) per share Fixed charter hire VLCC 63.1 0.
Slide 9: 2Q-09 contribution from projects
9 § Large performing fleet and significant cash-flow in 2Q 2009 • $2.65/share EBITDA-equivalent • $0.60/share net cash-flow from projects after interest and debt amortization § Full cash flow effect on all operational units throughout 2Q 2009 (2) 2Q-09 contribution from projects (1) (1) Not as accou
Slide 10: Profit & Loss
10 Profit & Loss Part of charter hire from assets classified as finance leases. Not included in ’total operating revenues’, but included in the cash flow statement Net income from subsidiaries accounted for as ’investment in associate’ Mainly derived from settlement of bond TRS agreements and the re
Slide 11: Balance Sheet
11 Balance Sheet ‘Stockholder’s equity’ in subsidiaries accounted for as ’investment in associate’ (3) (1) Three of our 100% owned subsidiaries, owning four of our units, are accounted for as ‘Investment in associate’. (2) As of June 30, 2009 ‘Stockholders’ equity’ excludes $207.1 million of deferre
Slide 12: Cash flow Statement
12 Cash flow Statement Net cash flow to/from our subsidiaries accounted for as ‘Investment in associate’ Part of charter hire from assets classified as finance leases.
Slide 13: Investment in associates
§ Selected 2Q 2009 income statement figures § Selected 2Q 2009 balance sheet figures 13 Investment in associates Part of charter hire from assets classified as finance leases. Not included in ’total operating revenues’, but included in the cash flow statement ‘Stockholder’s equity’ included in the C
Slide 14: Financing and Capital Expenditure
§ Financing • $2.4bn consolidated interest bearing debt, including bond loan • $2.0bn of bank loans in subsidiaries accounted for as ‘Investment in associate’ • No refinancing needs in the near term and compliance with all bank covenants § Limited capex commitments • Five newbuilding container vesse
Slide 15: Contracted cash flow (EBITDA)
15 $ in millions • Seadrill charters: • 100% Seadrill Ltd. guarantee • All ultra-deepwater units are sub- chartered to major oil companies • Frontloaded charter rate and loan repayment • Frontline charters: • Conservative base-rates • 20% profit split has generated on average approx $85m incremental
Slide 16: 22 quarters of profit share
§ Capturing incremental cash flow in strong markets • 20 % profit share of tankers/OBO earnings in excess of base charter rates • Spot tanker market exposure represents upside for SFL shareholders 16 (1) (2) 22 quarters of profit share The profit share is paid on an annual basis. Pro-forma accumulat
Slide 17: Summary
17 § $53.5m ($0.72/share) net income • $8.0m ($0.11/share) profit share accumulated in 2Q 2009 § Quarterly cash dividend of $0.30/share • 10% dividend yield (1) • Dividend may be paid in stock at the shareholder’s election § No refinancing needs in the near term and compliance with all bank covenant
Slide 18: Ship Finance International
Ship Finance International
Ship Finance International — Q2 2009 Earnings Presentation on 6ix