Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Norden — Q3 2015 Earnings Presentation
31 slides from Dampskibsselskabet Norden A/s's earnings presentation, Nov 11, 2015
Slide 1: NORDEN Results Third quarter of 2015
NORDEN RESULTS Third quarter of 2015 Hellerup, Denmark 11 November 2015 NORDEN – Third quarter of 2015 results | 1 Our business is global tramp shipping
Slide 2: Agenda
AGENDA Group highlights Financials Dry Cargo Tankers 2015 expectations Q & A NORDEN – Third quarter of 2015 results | 2 Our business is global tramp shipping
Slide 3: Q3 Highlights
Q3 HIGHLIGHTS EBIT Key messages 100 Group EBIT for the third quarter of 2015 of USD 21 mill (USD -28 mill.) 50 30 36 21 0 -28 -28 -50 -100 -230* Best Tanker result in NORDENs -150 -200 history -250 Continued weak markets in Dry -300 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 * Provision for onero
Slide 4: Focus & Simplicity
STRATEGY FOCUS & SIMPLICITY Reconfirmed commitment to both Dry Cargo and Product Tankers Focus efforts and investments where we can create most value beyond market conditions through our strong operator model Close customer relationships based strong reputation Extensive global network of of
Slide 5: Tanker result continues to climb
FINANCIALS TANKER RESULT CONTINUES TO CLIMB EBIT – Dry Cargo EBIT - Tankers 10 50 4 6 37 0 40 -9 33 -10 28 30 Million USD Million USD -22 -20 20 17 -30 10 -41 -40 0 - 230 -2 -50 -10 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 NORDEN’s performance vs. 1-year T/C 25
Slide 6: Balanced capital structure
FINANCIALS BALANCED CAPITAL STRUCTURE Cash flow from operations before working capital: USD 16 million Net commitment down USD 330 million last 12 months Combined undrawn credit facilities, cash and securities at USD 704 million Cover for yard payments per 30/9 Capital structure incl. off bala
Slide 7: Tanker values gradually increasing
ASSET VALUES TANKER VALUES GRADUALLY INCREASING Asset values for Dry Cargo testing new lows Tanker values have seen only a small increase despite strong spot market Adjustment of N/B orderbook to reduce near term exposure and lower cost Market value of NORDENs fleet below book values by USD
Slide 8: Dry Cargo: Rates testing lows again
DRY CARGO RATES TESTING LOWS AGAIN Continued poor markets despite of higher average rates in Q3 compared to 1H 2015 Panamax – spot rate Supramax – spot rate FFA 2016 18.000 18.000 16.000 16.000 16.000 14.000 14.000 14.000 12.000 12.000 12.000 10.000 USD/day USD/day USD/day 10.000 10.000 8.000 8.00
Slide 9: Chinese coal import stabilising, minor bulks strong
DRY CARGO CHINESE COAL IMPORT STABILISING, MINOR BULKS STRONG Q3 spot rate improvements driven by growth in the Chinese imports Halted destocking of iron ore inventories increased imports Strong bauxite import growth as Malaysia has been able to replace Indonesia All time high soybean import
Slide 10: Supply growth remains key challenge
DRY CARGO SUPPLY GROWTH REMAINS KEY CHALLENGE The overall fleet growth continues to be low in Q3 helped by 4% scrapping Looking past Q4 – 2016 looking equally challenging Early signs of turnaround in Chinese property market could support commodity demand Demand headwinds in general abating
Slide 11: Tankers: Strong Q3, but weak start to Q4
TANKERS STRONG Q3, BUT WEAK START TO Q4 Strong gasoline demand supported product tanker rates in Q3 – to a large extent driven by additional US and Chinese consumption High refinery activity in order to meet gasoline demand spawned demand for feedstock – crude freight rates therefore also surged
Slide 12: Transportation demand remains well supported, but elevated stock levels are a risk
TANKERS TRANSPORTATION DEMAND REMAINS WELL SUPPORTED – BUT ELEVATED STOCK LEVELS ARE A RISK US & Europe – Gasoline & Diesel stocks, mb OECD Commercial Crude Oil & Liquid fuels stocks, mb 970 3100 ≈ +13% ≈ +5% 950 3000 2900 930 2800 910 2700 890 2600 870 2500 850 2400 Source: JODI, EIA Source: US Dep
Slide 13: Well balanced market outlook for 2016
TANKERS WELL BALANCED MARKET OUTLOOK FOR 2016 2015 oil demand growth once again revised upwards in light of strong quarterly demand and continued low oil price 2016 revised slightly down due to a downgraded economic outlook and no expectations of same price triggered demand increase as seen in 2
Slide 14: 2015 Full Year Guidance
2015 FULL YEAR GUIDANCE Outlook Comments USDm Dry Cargo Tankers Total Full year EBIT guidance narrowed to USD 70 to 90 million. (Previously EBIT -25 to -10 100 to 120 70 to 90 USD 70 to 100 million) Profit from vessel -11 7 -4 sales Expectations for Tankers narrowed to USD 100 to 120 million. CA
Slide 15: Forward Looking Statements
This presentation contains certain forward-looking statements reflecting the management’s present judgment of future events and financial results. Statements relating to the remainder of 2015 and subsequent years are subject to uncertainty, and NORDEN’s actual results may therefore differ from the p
Slide 16: Thank you for your attention
Thank you for your attention http://www.linkedin.com/company/ds-norden/ http://twitter.com/DS_NORDEN http://www.facebook.com/shippingtrainee.com http://www.facebook.com/dampskibsselskabetnorden Dampskibsselskabet NORDEN A/S 52, Strandvejen DK-2900 Hellerup Denmark Phone: +45 3315 0451 www.ds-norden.
Slide 17: Back Up
BACK UP NORDEN – Third quarter of 2015 results | 17 Our business is global tramp shipping
Slide 18: A leading global tramp operator
A LEADING GLOBAL TRAMP OPERATOR DRY CARGO Capesize Post-Panamax Panamax Supramax Handysize 250 200 150 100 50 0 Dry cargo Tankers NORDEN vessels Pool vessels Tankers TANKERS MR Handysize Modern fleet Global network of offices and port captains Pools in Dry cargo (Handysize & Post-Panamax) and
Slide 19: Asset light business model
ASSET LIGHT BUSINESS MODEL… Active fleet can quickly be adjusted to demand and market conditions Fleet employment based on portfolio view Significant asset upside through purchase options Flexible fleet Coverage and customer focus Capacity Employment Sale and purchase Customer relations Co
Slide 20: Enabling value creation based on the cycle and throughout the cycle
…ENABLING VALUE CREATION BASED ON THE CYCLE AND THROUGHOUT THE CYCLE Exploiting the cycle Creating value throughout the cycle Taking a view on the fundamental market and Creating value above industry level irrespective of adjusting our exposure market conditions Levers: Levers: Commercial operations
Slide 21: Overall results
OVERALL RESULTS USDm Q3 2014 Q2 2015 Q3 2015 EBITDA - Dry Cargo -16 19 4 EBITDA - Tankers 8 35 45 Unallocated -3 -2 -7 EBITDA - Group -11 52 42 Depreciation -19 -17 -17 EBIT Group -28 36 21 Net profit -46 43 10 Cash from operations 9 65 -3 Net Cash flow -44 15 0 Cash and securities 279 340 359 NORDE
Slide 22: New building prices
NEW BUILDING PRICES Panamax (Dry) MR (Tank) 60 60 50 50 40 40 $ Million $ Million 30 30 20 20 10 10 - - Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 2015 1976 1979 1982 1985 1988 1991 1994 1997 20
Slide 23: Dry Cargo 12 month rolling average rates
USD/day USD/day - - 10.000 15.000 20.000 25.000 10.000 15.000 25.000 30.000 35.000 40.000 45.000 50.000 5.000 5.000 20.000 Jan-10 Jan-10 Apr-10 Apr-10 Capesize Supramax Jul-10 Jul-10 Oct-10 Oct-10 DRY CARGO Jan-11 Jan-11 Apr-11 Apr-11 Jul-11 Jul-11 Oct-11 Oct-11 Jan-12 Jan-12 Apr-12 Apr-12 Jul-12 Ju
Slide 24: Financial strength
FINANCIAL STRENGTH Strong capital structure Net committed cash Strong focus on cash flow USDm Q3 2015 Q2 2015 Q3 2014 generation Adjusted net interest 32 41 3 bearing assets* Cash in low-risk deposit accounts T/C obligations** -1,366 -1,337 -1,579 and securities Newbuilding instalments Equity
Slide 25: NPP historical performance
NPP HISTORICAL PERFORMANCE Handysize 30.000 18.000 16.000 25.000 NPP Pool Ship days 14.000 20.000 12.000 USD/day 10.000 15.000 8.000 10.000 6.000 4.000 5.000 2.000 0 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Q1 2015 Q2 2015 Q3 2015 NORDEN TCE 12 mth T/C avg. Market NPP Pool ship days (RHS)
Slide 26: Fleet values
FLEET VALUES NORDEN – Third quarter of 2015 results | 26 Our business is global tramp shipping
Slide 27: Dry Cargo fleet overview
DRY CARGO FLEET OVERVIEW NORDEN – Third quarter of 2015 results | 27 Our business is global tramp shipping
Slide 28: Product Tanker fleet overview
PRODUCT TANKER FLEET OVERVIEW NORDEN – Third quarter of 2015 results | 28 Our business is global tramp shipping
Slide 29: Dry Cargo
DRY CARGO NORDEN – Third quarter of 2015 results | 29 Our business is global tramp shipping
Slide 30: Product Tankers
PRODUCT TANKERS NORDEN – Third quarter of 2015 results | 30 Our business is global tramp shipping
Slide 31: The Share (DNORD)
THE SHARE (DNORD) Master data Composition of shareholders 15,903 registered shareholders Shareholder capital DKK 42,200,000 owning 89.2% Number of shares and 42,200,000 shares of Approx. 38% international denomination DKK 1 ownership Classes of shares 1 Voting and ownership restrictions None NAS