Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Norden — Q2 2017 Earnings Presentation
33 slides from Dampskibsselskabet Norden A/s's earnings presentation, Aug 17, 2017
Slide 1: NORDEN Results Second quarter of 2017
NORDEN RESULTS Second quarter of 2017 Copenhagen, Denmark 17 August 2017 NORDEN – SECOND QUARTER 2017| 1 Custodians of smarter global trade
Slide 2: Agenda
AGENDA Group highlights Financials Strategy Update Dry Cargo Tankers 2017 expectations Q&A NORDEN – SECOND QUARTER 2017| 2 Custodians of smarter global trade
Slide 3: Q2 Highlights
Q2 HIGHLIGHTS Adjusted result for Q2 USD -3 million Increase in Chinese imports supports improving dry cargo markets Deteriorating tanker markets throughout the quarter Stable asset values Building a strong platform for increased value generation in Dry Cargo Increased long-term exposure
Slide 4: Improvements in Dry Cargo and deterioration in Tankers
FINANCIALS IMPROVEMENTS IN DRY CARGO AND DETERIORATION IN TANKERS Adjusted result – Dry Cargo Adjusted result – Tankers 0 12 10 -2 10 8 7 -4 6 USD million USD million -6 4 3 -8 -7 2 -8 0 -10 -9 -2 -1 -12 -11 -4 -4 -14 -13 -6 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2
Slide 5: Strategy Update
STRATEGY UPDATE Dry Cargo split into 2 business units to improve value creation and create transparency Dry Cargo Operator Short-term dry cargo activities Create value through logistical optimization, exploiting arbitrage opportunities, and taking short-term freight trading positions Dry C
Slide 6: Balanced Capital Structure
FINANCIALS BALANCED CAPITAL STRUCTURE Equity share of 42%, which is considered an appropriate capital structure Net commitments increased by USD 126 million partly due to increase in tanker capacity Combined undrawn credit facilities, cash and securities at USD 503 million USD 268 million in
Slide 7: A Stabilisation in Asset Values
ASSET VALUES A STABILISATION IN ASSET VALUES After an increase during the last quarter asset values for Dry Cargo in Q2 have remained stable Tanker asset values increased at the beginning of Q2, but stabilised end of quarter Value of owned fleet is 56/44 split between Dry Cargo and Tankers 5-y
Slide 8: Dry Cargo: Continued Improvement in Chinese Imports
DRY CARGO CONTINUED IMPROVEMENT IN CHINESE IMPORTS Supramax: 49% above Q2 2016 Panamax: 79% above Q2 2016 Strong Chinese activity key driver of demand growth Iron ore imports increased by 6% Chinese coal imports increased by 14% Limited growth in Rest-of-World trade Panamax – spot rate S
Slide 9: Dry Cargo: Low Supply Growth Supporting Outlook
DRY CARGO LOW SUPPLY GROWTH SUPPORTING OUTLOOK Overall market rates in H2 2017 expected to be higher than H2 2016 Chinese growth will continue, but likely to be less significant Improving world economy should support ”non-China” trade A small up tick in ordering, but still at low levels Ne
Slide 10: Tankers: Continued Challenging Market Conditions
TANKERS CONTINUED CHALLENGING MARKET CONDITIONS The global tanker fleet continued to expand with steady deliveries and only few vessels scrapped Strong supply growth in recent years has created a oversupplied market High inventories acts as a buffer reducing the potential for temporary imbalan
Slide 11: Tankers: Product Recovery in 2018 Based on Lower Supply Growth
TANKERS PRODUCT RECOVERY IN 2018 BASED ON LOWER SUPPLY GROWTH Overall market rates in H2 2017 expected to be slightly weaker than H1 2017 Delivery pace of product tankers slowing Crude supply growth remains high. A weak crude market will limit the upside potential for product tankers but not p
Slide 12: NORDEN Narrows Expectations for 2017
2017 FULL YEAR GUIDANCE NORDEN NARROWS EXPECTATIONS FOR 2017 Outlook Comments USDm Dry Cargo Tankers Total Adjusted net result USD -20 to 20 million Previous USD -20 to 40 million Adjusted results for -25 to -5 -15 to 15 -20 to 20 the year Dry Cargo estimate adjusted to USD -25 to -5 million
Slide 13: 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 2017 and subsequent years are subject to uncertainty, and NORDEN’s actual results may therefore differ from the p
Slide 14: 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 15: Back up slides
FORWARD BACK UP SLIDES LOOKING STATEMENTS NORDEN – SECOND QUARTER 2017| 15 Custodians of smarter global trade
Slide 16: What makes NORDEN different?
WHAT MAKES NORDEN DIFFERENT? 2 Segments - focus on vessel types where we can make a difference Dry Cargo Tankers Full scale operational setup - Direct customer contact Portfolio of time charter-in contracts and earnings coverage Long track record of overperformance in Dry Cargo and Tanke
Slide 17: A leading global tramp operator
A LEADING GLOBAL TRAMP OPERATOR 74 DRY CARGO VESSELS (CORE FLEET) PANAMAX (23.5) SUPRAMAX (29.5) CAPESIZE (1) POST-PANAMAX (4) HANDYSIZE (16) Modern fleet Global network of offices and port captains Pools in Dry cargo (Handysize & Post-Panamax) and Tankers (MR & Handysize) Tankers MR (21) HAND
Slide 18: Development highlights
DEVELOPMENT HIGHLIGHTS 2015- Strategy: Focus & Simplicity Offices in Melbourne and Santiago 300 2005 2008 275 1871 Financial Norient Mads C. Holm founds NORDEN; first vessel delivered in crisis Product 1872 begins 250 Pool 225 1996-2005 Offices in Singapore, Number of active vessels 1875-76 200 Anna
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 Flexible fleet Coverage and customer focus Capacity Employment CORE FLEET Sale and purchase Customer relations Contracts of Technical competencies in- O
Slide 20: Why we succeed
…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 adjusting our Creating value above industry level irrespective of market exposure conditions Levers: Levers: Commercial operations
Slide 21: Overall results
OVERALL RESULTS USD million Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 EBITDA - Dry Cargo -4.5 -1.9 -4.0 -6.3 -2.6 EBITDA - Tankers 16.7 6.0 8.0 16.6 10.0 EBITDA - Group 12.2 4.1 2.9 10.3 7.4 Depreciation -13.8 -11.6 -10.8 -10.6 -10.2 EBIT Group -34 -12.9 -16.3 0.1 -2.8 Result for the period -24 -14.1
Slide 22: Newbuilding prices
0 10 20 30 40 50 60 1976-Jan 1977-Dec 1979-Nov Source: Clarksons 1981-Oct 1983-Sep Panamax (Dry) 1985-Aug 1987-Jul 1989-Jun NORDEN – SECOND QUARTER 2017| 22 1991-May 1993-Apr 1995-Mar 1997-Feb 1999-Jan 2000-Dec NEWBUILDING PRICES 2002-Nov 2004-Oct 2006-Sep 2008-Aug 2010-Jul 2012-Jun 2014-May 2016-Ap
Slide 23: Classic TCE Dry Cargo
CLASSIC TCE DRY CARGO Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Fleet days 91 92 92 90 92 Capesize TCE 3,106 6,774 12,231 10,411 12,676 Fleet days 747 658 397 567 386 Post-Panamax TCE 4,709 7,731 8,465 8,492 10,441 Fleet days 7,433 7,405 7,806 8,755 8,576 Panamax TCE 6,353 6,918 7,824 7,612 9,647 Flee
Slide 24: Financial strength
FINANCIAL STRENGTH Capital structure Net committed cash (ultimo) Cash in low-risk deposit accounts and USDm Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 securities Adjusted net interest -9 12 12 6 -24 Outstanding yard payments (incl. joint bearing assets* ventures (50%)) T/C obligations** -1,229 -1,2
Slide 25: Fleet values
FLEET VALUES Fleet values at 30 June 2017 USD ’000 Broker estimated value of owned Broker estimated value of Added Number Average dwt. Carrying amount/cost vessels* charter party value Dry Cargo Panamax 5.0 79,000 89 75 17 3 Supramax 14.5 60,000 315 307 0 -7 Handysize 7.0 37,000 101 82 15 -4 Total D
Slide 26: Dry Cargo fleet overview
DRY CARGO FLEET OVERVIEW NORDEN’s Dry Cargo fleet and values at 30 June 2017 Vessel type Capesize Post-Panamax Panamax Supramax Handysize Total Vessels in operation Owned vessels 0.0 0.0 4.0 5.5 7.0 16.5 Chartered vessels with a duration of more than 13 months 1.0 4.0 19.5 24.0 9.0 57.5 Total active
Slide 27: Product tanker fleet overview
PRODUCT TANKER FLEET OVERVIEW NORDEN’s Tanker fleet and values at 30 June 2017 Vessel type LR1 MR Handysize Total Vessels in operation Owned vessels 0.0 9.0 10.0 19.0 Chartered vessels with a duration of more than 13 months 1.0 12.0 1.0 14.0 Total active core fleet 1.0 21.0 11.0 33.0 Chartered vesse
Slide 28: Continuously outperforming the markets
PERFORMANCE CONTINUOUSLY OUTPERFORMING THE MARKETS Tankers - 4 quarter rolling NORDEN TCE over benchmark 6,000 5,000 4,000 3,000 2,000 1,000 0 -1,000 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Handy MR Dry Cargo - 4 quarter rolling NORDEN TCE over benchmark 6,000
Slide 29: Tanker fleet growth
TANKER FLEET GROWTH Tanker fleet growth 8% 7% 6% 5% 4% 3% 2% 1% 0% 2013 2014 2015 2016 2017E 2018E Product tankers Total tanker fleet NORDEN – SECOND QUARTER 2017| 29 Custodians of smarter global trade
Slide 30: Dry Cargo Capacity
DRY CARGO CAPACITY NORDEN – SECOND QUARTER 2017| 30 Custodians of smarter global trade
Slide 31: Dry Cargo Coverage
DRY CARGO COVERAGE NORDEN – SECOND QUARTER 2017| 31 Custodians of smarter global trade
Slide 32: Tankers
TANKERS NORDEN – SECOND QUARTER 2017| 32 Custodians of smarter global trade
Slide 33: The Share (DNORD)
THE SHARE (DNORD) Master data Composition of shareholders 15,895 registered shareholders owning Shareholder capital DKK 42,200,000 88.3% Number of shares and Approx. 31% international ownership denomination 42,200,000 shares of DKK 1 Classes of shares 1 Voting and ownership restrictions None A/S