Genco Shipping & Trading Limited · NYSE:GNK
Genco Shipping & Trading — Jefferies 7th Annual Shipping Logistics & Offshore Services Conference (September 2010)
29 slides from Genco Shipping & Trading's conference presentation, Sep 8, 2010
Slide 1: Genco Shipping & Trading Limited
Genco Shipping & Trading Limited Jefferies 7th Annual Shipping Logistics & Offshore Services Conference September 8, 2010
Slide 2: Forward Looking Statements
Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements ar
Slide 3: Agenda
Agenda Company Overview Financial Overview Industry Overview Conclusions 09/08/10 3
Slide 4: Company Overview
Company Overview
Slide 5: Management
Management Peter Georgiopoulos Gerry Buchanan John C. Wobensmith Chairman President Chief Financial Officer Over 25 years of Over 40 years of 16 years of experience in experience in the shipping experience in the shipping the shipping industry industry industry CFO since inception Chairman
Slide 6: Genco Overview
Genco Overview Founded in December 2004, completed IPO in July 2005 Pro-forma fleet of 53 vessels with an average age of 6.4 years after all deliveries ― Two substantial acquisitions executed in 2010 ― Agreed to acquire 13 Supramax vessels from affiliates of Bourbon SA ― Agreed to acquire five H
Slide 7: High Quality Operations
High Quality Operations Extensive relationships with Selected Customer Relationships established drybulk charterers These relationships help us to: ― Stabilize revenue through favorable contract terms ― Minimize counterparty risk ― Maximize fleet utilization We utilize three leading technical
Slide 8: Pro Forma Fleet
Pro Forma Fleet Vessel Name Year Built Dwt Vessel Name Year Built Dwt Capesize Bourbon Acquisition Genco Augustus 2007 180,151 Supramax Vessels(1) Genco Tiberius 2007 175,874 Genco Aquitaine - Delivered 2009 57,981 Genco London 2007 177,833 Genco Ardennes - Delivered 2009 57,981 Genco Titus 2007 177
Slide 9: Financial Overview
Financial Overview
Slide 10: Pro Forma Balance Sheet (Excluding Baltic Trading Limited)
Pro Forma Balance Sheet (Excluding Baltic Trading Limited) Selected Financial Information 6/30/10 (Dollars in thousands) Balance Sheet Cash(1) $165,288 Debt(2) $1,698,500 Shareholders’ Equity(3) $1,027,778 Capitalization $2,726,278 Debt/Capitalization 62% See the Appendix for a reconciliation of pro
Slide 11: Acquisition Financing
Acquisition Financing Metrostar Acquisition of Five Bourbon Acquisition of 13 Handysize Vessels Supramax Vessels Purchase price $166.3 million $439.5 million(1) $100 million senior secured credit facility $253 million senior secured credit facility Bank facilities with several leading shipping banks
Slide 12: Q3 2010 Estimated Daily Expenses
Q3 2010 Estimated Daily Expenses (1) Daily Expenses by Category Free Cash Flow(2) Net Income Genco Standalone Consolidated Direct Vessel Operating(3) 5,100 5,100 General, Administrative and 1,627 2,101 Management Fees(4) Dry Docking (5) 156 - Interest Expense (6) 5,108 4,886 Depreciation(7) - 6,670
Slide 13: Industry Overview
Industry Overview
Slide 14: Drybulk Index
09/08/10 W ee 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 k W 1 ee k W 3 Services Limited 2010 ee Source: Clarkson’s Research k W 5 ee k W 7 e W ek ee 9 k Drybulk Index W 11 ee k W 13 ee k W 15 ee W k1 ee 7 k W 19 ee k W 21 ee k W 23 ee W k2 ee 5 14 k W 27 ee Baltic Dry Index k W 29
Slide 15: Demand Side Fundamentals
Demand Side Fundamentals Chinese steel production increased 18.2% YOY through July of 2010 Iron ore inventories at Chinese ports currently stand at 71.1 mt(1) Iron ore pricing system shifted to quarterly negotiations Unusually warm weather in China increased coal imports Return of grain ca
Slide 16: Increasing Iron Ore Production is a Major Factor
Increasing Iron Ore Production is a Major Factor Key iron ore expansion plans equal an increased capacity of 331 million tons per annum(1) Key Expansion Plans(1) ― 331 million tons represents 35.8% of total 2009 seaborne iron ore trade BHP Fortescue Rio Tinto Vale MMX Rio Tinto approved $1 billi
Slide 17: Supply Side Fundamentals
Supply Side Fundamentals Scarce capital ― Banks lending only to selective clients Depressed vessel values imply higher equity installments required from illiquid owners Estimated 40% slippage of the scheduled orderbook through the first six months 33% of the fleet is greater than 20 years ol
Slide 18: Conclusions
Conclusions
Slide 19: Genco's Strategy
Genco’s Strategy Maintain Focus on Drybulk Sector with ROC Approach Consistent Time Charter Strategy Modern High-Quality Fleet Cost Efficient Operations Transparent Operations 09/08/10 19
Slide 20: Appendices
Appendices
Slide 21: Year to Date Earnings - Consolidated
Year to Date Earnings - Consolidated Three Months Ended Six Months Ended June 30, 2010 June 30, 2009 June 30, 2010 June 30, 2009 (Dollars in thousands, except share and per share data) (Dollars in thousands, except share and per share data) (unaudited) (unaudited) INCOME STATEMENT DATA: Revenues $ 1
Slide 22: Consolidating Income Statement
Consolidating Income Statement Three Months Ended June 30, 2010 (Dollars in thousands, except share and per share data) Non Controlling INCOME STATEMENT DATA: Genco Baltic Trading Elimination Interest Total Revenues $ 100,775 $ 6,991 $ (2,429) $ - $ 105,337 Operating expenses: Voyage expenses 959 15
Slide 23: June 30, 2010 Balance Sheet - Consolidated
June 30, 2010 Balance Sheet - Consolidated June 30, 2010 December 31, 2009 (Dollars in thousands) (unaudited) BALANCE SHEET DATA: Cash (including restricted cash) $ 208,139 $ 205,767 Current assets, including cash 233,916 218,068 Total assets 2,583,301 2,336,802 Current liabilities (including curren
Slide 24: Second Quarter Highlights – Consolidated
Second Quarter Highlights – Consolidated Three Months Ended Six Months Ended June 30, 2010 June 30, 2009 June 30, 2010 June 30, 2009 (unaudited) (unaudited) FLEET DATA: Total number of vessels at end of period 40 32 40 32 Average number of vessels (1) 38.0 32.0 36.5 32.0 Total ownership days for fle
Slide 25: Pro Forma Reconciliation 6/30/10
Pro Forma Reconciliation 6/30/10 (Dollars in thousands) 6/30/10 Actual Adjustment 6/30/10 Pro Forma Cash(1) $208,139 (42,851) $165,288 Debt(2) $1,311,975 386,525 $1,698,500 Shareholders’ Equity(3) $1,186,670 (158,892) $1,027,778 Capitalization $2,498,645 (227,633) $2,726,278 (1) June 30, 2010 pro fo
Slide 26: Acquisition Vessel Payment Schedule
Acquisition Vessel Payment Schedule (Dollars in thousands) Expected Deposit as % of Payment on Vessel Name Deposit Payment Total Price Delivery (1) Purchase Price Delivery Metrostar Acquisition Vessels Genco Ocean Delivered 10% 3,325 29,925 33,250 Genco Bay Delivered 10% 3,325 29,925 33,250 Genco Av
Slide 27: Fleet Details
Fleet Details* Cash Daily Net Revenue Daily Vessel Type Vessel Name Year Built Charterer Charter Expiration (3) Rate (1) Rate (2) Genco Augustus 2007 Cargill International S.A. $39,000 December, 2010 Genco Tiberius 2007 Cargill International S.A. 34,000 October, 2010 Genco London 2007 Cargill Intern
Slide 28: Fleet Details
Fleet Details Cash Daily Net Revenue Vessel Type Vessel Name Year Built Charterer Charter Expiration (3) Rate (1) Daily Rate (2) Genco Success 1997 Korea Line Corporation 33,000 (7) February, 2011 Genco Carrier 1998 Louis Dreyfus Corporation 37,000 March, 2011 Handymax Genco Prosperity 1997 Pacific
Slide 29: Footnotes to Fleet Table (previous two pages)
Footnotes to Fleet Table (previous two pages) (1) Time charter rates presented are the gross daily charter-hire rates before the payments of brokerage commissions generally ranging from 1.25% to 6.25% to third parties. In a time charter, the charterer is responsible for voyage expenses such as bunke