Wilh. Wilhelmsen Holding Asa Class A · OSL:WWI
Wilh. Wilhelmsen Holding Asa Class A — Investor Day (September 2016)
49 slides from Wilh. Wilhelmsen Holding Asa Class A's investor day presentation, September 2016
Slide 1: Capital Markets Day 2016 Wilh. Wilhelmsen ASA main topics
Capital Markets Day 2016 Wilh. Wilhelmsen ASA main topics Global Tonnage Situation Jan Eyvin Wang President and CEO Wilh. Wilhelmsen ASA Rough Sailing – Global Market Intelligence Ari Marjamaa Vice President Head of Global Market Intelligence Wallenius Wilhelmsen Logistics WWL’s Landbased logistics
Slide 2: Global tonnage situation
Capital Markets Day 2016 Wilh. Wilhelmsen ASA Global tonnage situation
Slide 3: World deep sea fleet has grown significantly
September 2016 World deep sea fleet has grown significantly Total orderbook is at 11.3% in terms of capacity Fleet composition by year of build, pure deep sea fleet Number of vessels above 3500CEU, May 2016 # of ships CEU capacity 400.000 387.365 70 ACTIVE OPTION ORDER UNCONFIRMED TOTAL NUMBER OF VE
Slide 4: A steady growth in lifting capacity
A steady growth in lifting capacity Driven by vessel size Historical fleet development Net fleet development Fleet in CEU and # of vessels, 1998-2015 Deliveries, scrapping and net fleet addition in CEU, 1998-2015 Net fleet growth as 10 % 10 % 3% 2% 4% 7% 9% 10 % 10 % 4% -3 % 5% 7% 5% 2% 3% 2% % of c
Slide 5: The average vessel is getting bigger and younger
The average vessel is getting bigger and younger Average size has grown by 21%, while average age has grown 9% last years Average size of vessels has grown by 22% in the last decade Average age of vessels has increased 9% since the building boom Average size of vessels, in 1000 CEU, 1998-2014 Averag
Slide 6: Average age of vessels being scrapped has risen significantly last 20 years
Newbuildings & recycling Average age of vessels being scrapped has risen significantly last 20 years Vessels are used much longer today than before Recycled vessels in 1000 CEU, average age of recycled vessels kCEU Capacity Age in years 365 400 32 30 350 28 26 195 300 24 22 250 20 18 200 181 16 14 1
Slide 7: WW group is the largest operator group in the market
Global Roll-on Roll-off Fleet WW group is the largest operator group in the market 72 vessels currently on firm orders, representing a 12,3% share of capacity Current orderbook by operator Current fleet by operator group kCEU and number of vessels, share of total orderbook capacity in kCEU and numbe
Slide 8: WWL fleet characterised by stronger High & Heavy capabilities compared to competitors
Fleet characteristics WWL fleet characterised by stronger High & Heavy capabilities compared to competitors WWL still ahead on the characteristics of the fleet... Ramp capacity in tons, # of hoistable decks and CEU capacity (size), July 2015 Average max ramp capacity 300 250 WWL 200 GRIMALDI 150 EUK
Slide 9: PCTC fundamentals, expected to remain weak for another 2-3 years
PCTC fundamentals, expected to remain weak for another 2-3 years Opportunity for low TC tonnage 9 Source: Platou/Clarkson
Slide 10: Rough sailing
Rough sailing Global Market Intelligence Wallenius Wilhelmsen Logistics September 2016
Slide 11: Rough sailing in global RoRo markets
Rough sailing in global RoRo markets Support to be found in the fundamentals A changing auto The market is Construction ..while mining see industry still under pressure keeps HH up.. mostly upside supports volume • Global trade • Auto industry facing • Weaker than • Shipments still development signi
Slide 12: The RoRo markets are rough
Market under pressure The RoRo markets are rough Auto volumes driving improvement, HH remains under pressure Development in global cargo shipments has seen some improvement since fall 2015, led by automotive volumes Automotive, HH and BB cargo, exports, y-o-y comparison of 12mo moving average, Q1 20
Slide 13: Rough sailing in global RoRo markets
Rough sailing in global RoRo markets Support to be found in the fundamentals A changing auto The market is Construction ..while mining see industry still under pressure keeps HH up.. mostly upside supports volume • Global trade • Auto industry facing • Weaker than • Shipments still development signi
Slide 14: The automotive industry is rapidly changing
A changing auto industry still supports volume The automotive industry is rapidly changing The shift from a product centric to a service driven model creates opportunities for a logistics operator …but growth in user base, new drivers will lead to more kilometers consumed New technology and user hab
Slide 15: Electric vehicles to see significant growth
A changing auto industry still supports volume Electric vehicles to see significant growth Manufacturers appear to have made the technology choice Strong growth in number of fully electric car models offered in the global auto market, outgrowing any other alternative technology EV models, number on
Slide 16: Deepsea LV volume expected to grow with a CAGR of 1.5%
A changing auto industry still supports volume Deepsea LV volume to expected to growth with a CAGR of 1.5% going forward AS-NA only major trade expected to see decreases Global auto sales to develop positively going forward… …while AS-NA is the only major trade with decrease Sales, domestic producti
Slide 17: China still largest light vehicle market, Indian LV market set to soar
A changing auto industry still supports volume China still largest light vehicle (LV) market, Indian LV market set to soar Deepsea volume growth below market growth, excluding JP/KR-NA volumes volume growth on par with total market …but the big markets to develop slower in the next five years than i
Slide 18: Rough sailing in global RoRo markets
Rough sailing in global RoRo markets Support to be found in the fundamentals A changing auto The market is Construction ..while mining see industry still under pressure keeps HH up.. mostly upside supports volume • Global trade • Auto industry facing • Weaker than • Shipments still development signi
Slide 19: Industry forecaster sees construction equipment sales growing by 5% in '17
Construction keeps HH up.. Industry forecaster sees construction equipment sales growing by 5% in ’17 China returning to growth, developed markets see turn of cycle Global sales of construction equipment set to recover significantly 1000 units, 2011-2020FC 1.025 920 875 +12% 804 790 800 754 +5% 770
Slide 20: Seeing the bottom of the cycle
Construction keeps HH up.. Seeing the bottom of the cycle Construction equipment manufacturers’ sales are anticipated to bottom out in 2016, seeing growth in 2017-18 Construction equipment producers revenue forecast Consensus forecasted revenue by sell side analysts, Factset 2016-09-12, Real USD -10
Slide 21: Rough sailing in global RoRo markets
Rough sailing in global RoRo markets Support to be found in the fundamentals A changing auto The market is Construction ..while mining see industry still under pressure keeps HH up.. mostly upside supports volume • Global trade • Auto industry facing • Weaker than • Shipments still development signi
Slide 22: Mining commodity prices remain pressured, but resource industries appear to have turned a corner
..while mining see mostly upside Mining commodity prices remain pressured, but the resource industries appear to have turned a corner S&P: Metals and Mining index have fallen significantly since the high valuations in Commodities appear to have turned a corner 2011 Total return metal indices, Coal p
Slide 23: The mining companies still working hard to improve profitability
..while mining see mostly upside The mining companies still working hard to improve profitability Miners are addressing cash flow challenges with cost initiatives and restructuring programmes Miners’ share price and return on assets have both declined significantly Illustration of miners’ actions fo
Slide 24: Replacement demand building up
..while mining see mostly upside Replacement demand building up The equipment contraction significantly exceeds the CAPEX drop while production is record high CAPEX cuts continue with most mining companies reducing their mining investments Production volumes continue to be high, consuming equipment
Slide 25: Australia's investment phase may be slowing, production phase has just started
..while mining see mostly upside Australia’s investment phase may be slowing, while the production phase has just started – and production will drive equipment demand Following an investment boom is the production boom Value of Australian mining projects in pipeline Value of projects and estimated m
Slide 26: Significant share of Global Mining Project Pipeline stems from Oceania
..while mining see mostly upside Significant share of Global Mining Project Pipeline stems from Oceania Largest unused potential of all regions, representing future demand if conditions are right Global Project Mining Development Pipeline Global Mining Projects by Commodity and Type Strong pipeline,
Slide 27: World Coal production and consumption will continue to grow towards 2040
..while mining see mostly upside World Coal production and consumption will continue to grow towards 2040, Australia fourth largest producer World coal consumption by region, 1980-2040 Coal Production 2015, top 10 production countries Quadrillion Btu Mt 4.000 3.538 3.500 3.000 2.500 2.000 1.500 1.00
Slide 28: Parker Bay expects mining equipment shipments to have bottomed out
..while mining see mostly upside Parker Bay expects mining equipment shipments to have bottomed out The increased demand in 2016-2020 will be driven mainly by the need to sustain existing capacity Parker Bay mining equipment population and shipments Active loading and haulage mining equipment popula
Slide 29: Rough sailing in global RoRo markets
Rough sailing in global RoRo markets Support to be found in the fundamentals A changing auto The market is Construction ..while mining see industry still under pressure keeps HH up.. mostly upside supports volume • Global trade • Auto industry facing • Weaker than • Shipments still development signi
Slide 30: Thank you!
Thank you! 21
Slide 31: WWL's Landbased logistics business
WW Capital Markets Day Rune Gisvold WWL’s Landbased 13 September 2016 at 15:00 logistics business 1
Slide 32: WWL's Landbased business
WWL’s Landbased business Over the past 12 years we have built a > USD 1,2 Bn Landbased logistics business We have grown with our customers into their value chain as they expand globally Less volatility and different business drivers from Ocean services Global products in a network of locations in ke
Slide 33: Landbased business is rapidly approaching 50% of WWL's global turnover
Landbased business is rapidly approaching 50 % of WWL’s global turnover REVENUES 1H 2016 Landbased revenues have grown by 20 % annually since 2009 Terminals volumes and revenues vary with trade volumes, but Terminals without the BAF impact 11 % Landbased Tech Services have seen steady Ocean MUSD 637
Slide 34: A global network serving outbound logistics needs of global equipment manufacturers
A global network serving outbound logistics needs of global (auto & HH) equipment manufacturers 4
Slide 35: Terminal and processing site examples
Zeebrugge RoRo terminal Yard management and processing H/H equipment processing for VW at the US/Chattanooga plant in Mebourne Yard management and distribution Volvo wheelloader at the Thailand FordMazda factory washing at Singapore EPC A Siemens transformer on the way up a vessel ramp PDI at Mumbai
Slide 36: We provide services to our customers throughout their outbound supply chain
We provide services to our customers throughout their outbound supply chain Terminal services Technical services Inland Distribution Receipt and delivery Repairs and rectifications Truck Storage Accessory fitting Rail Stevedoring Storage management Barge Customs clearance Pre Delivery Inspections ….
Slide 37: The customers are the same as those we serve on the Ocean side
The customers are the same as those we serve on the Ocean side Cars High & Heavy BreakBulk 7
Slide 38: Established >10 years ago as a defensive strategy evolving into a global service provider
Established > 10 years ago as a defensive strategy evolving into a global service provider Early 1990s 2005 2009 2010/11 2016 Southamton and DAS acquired Castor Green EPC ‘s in Panama, VSA and CAT-WWL Port Huemne from Nissan Terminal – our zero Galveston and 100% takeover North America emission visi
Slide 39: The Landbased business has shown consistent growth since the financial crisis
The Landbased business has shown consistent growth since the financial crisis Revenue growth and margin improvements Nissan largest customer, but good diversity Revenues MUSD Revenues MUSD 1400 180 160 1200 140 1000 120 800 100 600 80 60 400 40 200 20 0 0 2009 2010 2011 2012 2013 2014 2015 2016 Niss
Slide 40: The VSA quantum leaps
The VSA quantum leaps 1) Acquisition 2) End of profit-share 3) 100 % ownership The VSA story The VSA network WWL acquired 50% of DAS from Nissan in 2005 together with a financial investor – Low acquisition price + profit sharing – The Nissan based network was set to grow with new customers Expansion
Slide 41: The terminal business has grown into a truly global services provider
The terminal business has grown into a truly global services provider Established to secure land Zeebrugge Kotka Ownership: 100% Ownership: 100% Pyeongteak Ownership: 50% access and priority birthing Port Hueneme Ownership: 100% Baltimore Ownership: 100% – Efficient time in port is key Southampton t
Slide 42: MIRRAT is our new RoRo terminal in Melbourne
Melbourne RoRo Terminal MIRRAT is our new RoRo terminal in Melbourne completed on time & budget and now in operations Construction period: Q3 2014-Q1 2016 Exclusive operator : Jan 2018 MIRRAT established From Jan 2018, MIRRAT will take over Construction started in August operations at Webb Dock We
Slide 43: 3 distinct products with differing financial characteristics
3 distinct “products” with differing financial characteristics Terminal services Technical services Inland Distribution “Captive business” with high “Nickels & dimes” business Generally a low margin margins and long concessions with variable costbase business Either somewhat capital Efficient use of
Slide 44: 3 distinct products: revenue and EBIT margin
3 distinct “products” EBIT margin with differing financial characteristics Revenue Terminal services Technical services Inland Distribution Revenues EBIT Revenues EBIT Revenues EBIT USD M Percent USD M Percent USD M Percent 800 20 800 20 800 20 734 700 700 700 Fixed fees on growing VSA acquisition r
Slide 45: 3 distinct products: customer mix
3 distinct “products” with differing financial characteristics Terminal services Technical services Inland Distribution Nissan Nissan Toyaota Subaru Komatsu BMW Ford BMW VW JLR JLR Ford Diamler Toyota Volvo CNH GM VW Volvo VW Porche Caterpillar Porche John Deere John Deere CNH Diamler Other Other Ot
Slide 46: Strategies have changed over time
Strategies have changed over time Size matters also on land Initially established as a defensive ocean trades strategy : Port rationalization and priority birthing The customer base provided opportunities Growth created size and scale Advanced process management was required to solidify competitiven
Slide 47: The legal & financial structure allows focus and continued growth
The legal & financial structure allows focus and continued growth The Landbased strategy has common touch-points with WWL AS Ocean - but separate targets KPI’s are tailored to market characteristics and business WW Landbased drivers Holding AS (WWLH) WWL Ocean Financing & funding is non- recourse to
Slide 48: Strategies going forwards reflect the level of maturity
Strategies going forwards reflect the level of maturity Portfolio management Organic growth & M&A New services in a digital age The Landbased portfolio Organic growth will continue WWL continuously evaluate includes >50 individual sites in with new customers and sites technology developments amongst
Slide 49: WWL's Landbased logistics business
WWL’s Landbased logistics business The Baltimore terminal and processing center 19