D'amico International Shipping S.a. · MIL:DIS
D'amico International Shipping — Q2 2020 Earnings Presentation
43 slides from D'amico International Shipping's earnings presentation, Jul 30, 2020
Slide 1: Q2 & H1 2020 Result Presentation
Q2 & H1 2020 Result Presentation d’Amico International Shipping July 30th, 2020
Slide 2: Disclaimer
DISCLAIMER. There shall be no offering or sale of any securities of d’Amico International Shipping S.A. in the United States of America, Switzerland, Canada, Australia, Japan, the United Kingdom or any jurisdiction in which such offer, solicitation or sale would be unlawful prior to its registration
Slide 3: Agenda
AGENDA. ▪ Executive summary ▪ DIS’ overview and key financials ▪ Market overview ▪ Why invest in DIS ▪ Appendix
Slide 4: Executive summary
Executive summary. • Net result – DIS posted a Net profit of US$ 17.1m in H1’20 vs. US$ (24.3)m in H1’19 and Adjusted net result (excluding non-recurring/non-cash items from both periods) of US$ 26.4m in H1’20 vs. US$ (9.2)m in H1’19 (i.e. US$ 35.6m increase y-o-y). In Q2 2020, DIS posted its best q
Slide 5: Executive summary (continued)
Executive summary (continued). • Market update – At the beginning of the year, the general outlook for the tanker sector was very positive, based on strong fundamentals linked to the implementation of IMO 2020 and its anticipated positive effects on the demand for the seaborne transportation of refi
Slide 6: DIS' Overview and Key Financials
DIS’ Overview and Key Financials
Slide 7: A modern, high-quality and versatile fleet
A modern, high-quality and versatile fleet. June 30th, 2020 DIS Fleet 1 LR1 MR Handy Total % Owned 5.0 11.0 6.0 22.0 52.4% Bareboat chartered 1.0 8.0 0.0 9.0 21.4% Time chartered-in long-term 0.0 8.0 0.0 8.0 19.1% Time chartered-in short-term 0.0 3.0 0.0 3.0 7.1% TOTAL 6.0 30.0 6.0 42.0 100.0% • DIS
Slide 8: Rapidly declining CAPEX commitments
Rapidly declining CAPEX1 commitments. Investment plan US$/mm 250.0 194.6 200.0 3.9 DIS has no remaining newbuilding 164.4 151.1 CAPEX having fully completed its long- 12.8 150.0 0.7 101.2 term investment plan in FY’19 85.3 83.7 79.0 1.0 100.0 190.7 8.1 2.5 1.4 65.2 151.6 150.3 5.2 50.0 100.2 77.1 81
Slide 9: Lighter bank debt repayments from 2020
Lighter bank debt repayments from 2020. Forecasted bank debt financing cash-flow Daily bank loan repayment on owned vessels (Excluding overdraft facilities)1,2,3 (Excluding overdraft facilities)4,5 US$/mm US$/mm US$/mm US$/day 80.0 80.0 60.0 6,400 6,147 - 60.0 60.0 50.0 6,000 40.0 40.0 64.8 20.0 20.
Slide 10: DIS' purchase options on leased vessels
DIS’ purchase options on leased vessels. Purch. Purch. First Ex. Option Vessel Name Build Date Option First Obligation 1 (In/Out of the money) Ex. Date Date High Trust Jan-16 Jul-19 Jul-28 In the money High Loyalty Feb-15 Oct-19 Oct-28 In the money High Priority Mar-05 Oct-19 Oct-22 In the money Hig
Slide 11: Contracts and fleet mix to drive future results
Contracts and fleet mix to drive future results. Increasing average TC rates1,2 US$/day • TC contract rates have reached a bottom in Q2’19 % of ‘employment days’ and average rates of signed contracts rise throughout 2020. 70% 17,000 16,43716,421 16,23616,314 60% 15,864 16,171 16,500 16,000 • TC cont
Slide 12: Large potential upside to earnings
Large potential upside to earnings. Estimated Fleet Evolution (Avg. N. of Vessels)1,2,4 Estimated Spot Exposure (Avg. N of Vessels)3,4 N. of ships (based on ‘available days’) N. of ships (based on ‘employment days’) 45 41.2 60 40 37.4 35.8 9.0 50 35 9.0 8.8 30 40 11.0 25 8.6 8.0 30 20 15 20 32.4 10
Slide 13: DIS has focused also on cost savings
DIS has focused also on cost savings. Daily Operating Costs – Owned and General & Administrative Costs – Total bareboat vessels1 Fleet2 US$/day US$/m 7,600 850 7,400 800 7,200 750 7,000 700 6,800 7,534 650 810 6,600 752 600 6,400 6,796 662 6,679 6,200 550 6,000 500 H1'18 H1'19 H1'20 H1'18 H1'19 H1'2
Slide 14: Financial results. Net financial position
Financial results. Net financial position (US$ million) Dec. 31st, 2019 Jun. 30th, 2020 Gross debt (600.9) (569.2) IFRS 16 – additional liabilities (122.8) (110.7) Cash and cash equivalents 33.6 50.4 Other current financial assets1 7.3 9.1 Net financial position (NFP) (682.8) (620.4) Net financial p
Slide 15: Financial results. H1'20 Results
Financial results. H1’20 Results Non-recurring items: (US$ million) Q2’19 Q2’20 H1’19 H1’20 (US$ million) Q2’19 Q2’20 H1’19 H1’20 TCE Earnings 62.4 78.7 126.3 150.1 Result on disposal of vessels (0.8) 0.4 (0.9) (0.1) Result on disposal of vessels (0.8) 0.4 (0.9) (0.1) Non-recurring financial items (
Slide 16: Financial results. Key operating measures
Financial results. Key operating measures Key Operating Q1 2019 Q2 2019 H1 2019 Q3 2019 Q4 2019 FY 2019 Q1 2020 Q2 2020 H1 2020 Measures Avg. n. of vessels 49.4 49.8 49.6 48.5 47.6 48.8 46.0 44.4 45.2 Fleet contact 46.4% 48.0% 47.3% 51.5% 60.4% 51.6% 64.6% 62.6% 63.7% coverage Daily TCE Spot 13,583
Slide 17: Market Overview – Market fundamentals
Market Overview – Market fundamentals
Slide 18: TC rates and asset values reverse trend following Covid-19
TC rates and asset values reverse trend following Covid-19 . 1 Year TC MR (Conventional, non-Eco) rate1 5 & 10 year-old MR values1 US$/day US$/m 18,000 16,925 35 17,000 16,600 31.0 28.0 30 16,000 26.5 26.8 27.0 15,844 25.0 25.0 29.0 15,000 25 27.5 27.5 22.0 13,900 13,906 14,094 25.0 26.0 13,875 14,7
Slide 19: The impact of Covid-19 on the product tankers market
The impact of Covid-19 on the product tankers market. % of LR2 fleet clean vs. dirty trade1 YTD’20 vs.’19 Clarksons’ MR2 spot clean earnings2 US$/day 80,000 74,081 100% 90% 70,000 80% 53% 52% 52% 52% 52% 60,000 70% 65% 66% 66% 66% 66% 65% 65% 64% 63% 60% 50,000 50% 40,000 40% 30% 30,000 24,953 20% 4
Slide 20: Large drop in oil demand and refining throughputs
Large drop in oil demand and refining throughputs. Global oil demand1 Global refinery throughputs1 Million barrels per day Million barrels per day 100.0 90.0 90.0 80.0 84.1 85.0 82.9 82.9 83.1 82.1 81.8 82.1 81.8 70.0 80.6 81.2 80.1 80.2 60.0 80.0 82.4 50.0 100.8 100.8 97.1 100.0 79.7 99.0 94.0 99.3
Slide 21: Large but temporary build-up in floating storage
Large but temporary build-up in floating storage. Crude oil price (Brent, US$ bbl), forward curve1 CPP vs DPP Floating Storage2 Million barrels 45.5 45.2 350 45.0 44.8 325 45.0 44.5 300 44.5 44.3 275 44.0 43.8 250 44.0 43.6 225 43.3 200 43.5 43.1 175 42.8 43.0 150 125 42.5 100 42.0 75 50 41.5 25 0 J
Slide 22: Longer-term: healthy and resilient demand growth
Longer-term: healthy and resilient demand growth. World seaborne refined products trade1 Billion Tonne-miles 3,500 • Seaborne oil product trade 3,000 demand has contracted in 2019, and is expected to fall sharply in 2,500 2020 before resuming growth in 2,000 2021; It has been growing at a CAGR of 3.
Slide 23: Longer-term: large potential upside to asset values
Longer-term: large potential upside to asset values. Historical MR TC and spot rates1 Historical MR asset values1 US$/day US$/m 45,000 60 40,000 1 YR TC and Spot rates are NB, 5yr old and 10yr old vessels are 35,000 respectively ~57% and ~86% 55 respectively ~36%, ~49% and ~60% below the last cycle
Slide 24: Longer-term: growth in refinery capacity
Longer-term: growth in refinery capacity. Capacity additions 2019-2024 by region Refinery growth 2020-2024 kb/d 2% 1800 2,039 2,091 2400 12% 1600 2000 1,665 1400 27% 1200 1600 1000 1,018 973 10% 1200 800 800 600 315 400 400 200 0 0 -200 2019 2020 2021 2022 2023 2024 -400 21% -400 OECD North America
Slide 25: Longer-term: changes in refining landscape driving demand
Longer-term: changes in refining landscape driving demand. Forecasted changes in refining throughput 2019- 2025 m bbl/d 1 5.0 4.8 4.1 4.0 3.0 2.2 2.0 1.3 1.0 0.8 0.8 0.7 0.4 0.2 0.2 0.0 Europe FSU Other Latin India North Africa Middle China Atlantic East of Total -0.4 Asia America America East Basin
Slide 26: Longer-term: US crude exports
Longer-term: US crude exports. US exports of crude oil1 US pipeline additions2 Million barrels/day Million barrels/day 3.5 6.0 3.0 1.0 5.0 2.5 4.0 2.0 2.3 3.0 1.5 4.8 2.0 1.0 2.5 2.5 0.5 1.0 0.0 0.0 FY'08 FY'09 FY'10 FY'11 FY'12 FY'13 FY'14 FY'15 FY'16 FY'17 FY'18 FY'19 H1'20 • In FY’19 US crude exp
Slide 27: Slowing fleet growth
Slowing fleet growth. MR & LR1 deliveries and scrapping (m dwt) (lhs), and net Current MR & LR1 fleet age fleet growth (%)1 (rhs) profile1 23% of current fleet Million Dwt 12 11.6% 11.9% 12% Million Dwt 11.3% 10 9.7% 10% 30 27.9 9.5% 6% of current fleet 6% of current fleet 8.7% 8 8% 25 6 6% 4.6% 4.6
Slide 28: Reduction in fleet growth expected already in H2'20
Reduction in fleet growth expected already in H2’20. MR & LR1 deliveries, 20201 40 35 30 N. Of vessels 25 20 34 15 29 24 10 19 19 18 5 0 Q1'20 Q2'20 Q3'20 Q4'20 Estimated deliveries Actual deliveries MR & LR1 demolitions, 2018-20201 16 14 12 N. Of vessels 10 8 14 13 13 6 10 4 8 6 5 5 2 4 2 0 Q1'18 Q
Slide 29: Limited newbuild orders
Limited newbuild orders. MR Newbuilding parity curve vs MR & LR1 orders second-hand values1 US$ Million N. Of vessels 40.00 35.25 250 35.00 28.76 30.00 27.50 200 25.00 22.27 150 20.00 18.00 15.79 15.00 225 12.00 100 189 10.00 143 135 82 5.00 50 100 97 73 85 66 68 0.00 30 15 21 0 1 2 3 4 5 6 7 8 9 10
Slide 30: Strong long-term fundamentals
Strong long-term fundamentals. Seaborne volume and MR/LR1 fleet growth (lhs)%1 vs 1 year MR and LR1 TC rate (rhs) YoY% US$/day 15.00 35,000 31,090 29,185 30,000 27,006 10.00 23,446 23,597 25,000 22,819 5.00 18,866 18,710 20,000 16,492 17,754 18,127 16,625 16,629 15,078 13,169 13,131 15,000 - 15,499
Slide 31: Why invest in DIS
Why invest in DIS
Slide 32: Historical NAV evolution
Historical NAV evolution. DIS’ Historical NAV evolution1 US$/m US$/share 1000 0.93 1.00 0.88 900 0.90 800 0.76 0.80 0.89 0.72 700 0.64 0.70 0.56 600 0.52 0.60 500 0.42 0.50 0.39 400 0.35 0.33 0.35 0.40 0.31 296 314 285 300 374 0.25 0.26 0.25 0.30 218 230 0.23 0.24 334 320 313 302 0.16 200 255 0.14 0
Slide 33: Why invest in DIS today
Why invest in DIS today. • Young-fleet, most of which acquired at historically attractive prices and at top-tier yards. Furthermore, vessels are mostly eco-design (67.7% of owned and bareboat ships following delivery of all DIS’ newbuildings) and IMO classed (78.6% of owned and bareboat ships follow
Slide 34: Appendix
INTERNATIONAL SHIPPING SA.
Slide 35: DIS' Shareholdings Structure
DIS’ Shareholdings Structure. Key Information on DIS’ shares 3 d'Amico International SA 65.66% Others 33.64% d'Amico International Shipping SA 0.70% 100% 2 1 Listing market Borsa Italiana, STAR No. of shares 1,241,045,340 Market capitalisation1 €109.6 million Shares repurchased / % of share capital
Slide 36: d'Amico Group Structure
d’Amico Group Structure. 66% 64.0% 1 1 DIS benefits from the support of d’Amico Società di Navigazione S.p.A. 1. Eco Tankers Ltd and DM Shipping d.a.c. are currently under liquidation 36
Slide 37: Financial results. Consolidated Income Statement
Financial results. Consolidated Income Statement Q2 2020 Q2 2019 H1 2020 H1 2019 UNREVIEWED UNREVIEWED US$ Thousand 90,987 87,387 Revenue 185,342 178,418 (12,327) (24,938) Voyage costs (35,268) (52,111) 78,660 62,449 Time charter equivalent earnings* 150,074 126,307 (11,255) (4,300) (7,230) Time cha
Slide 38: Financial results. Consolidated Balance Sheet
Financial results. Consolidated Balance Sheet As at As at US$ Thousand 30 June 2020 31 December 2019 ASSETS Property, plant and equipment and Right-of-use 927,979 958,312 Investments in jointly controlled entities 4,382 4,382 Other non-current financial assets 12,979 17,348 Total non-current assets
Slide 39: Financial results. Consolidated Statement of Cash Flow
Financial results. Consolidated Statement of Cash Flow Q2 2019 Q2 2019 US$ Thousand H1 2019 H1 2019 UNREVIEWED UNREVIEWED 15,622 (18,807) Profit (loss) for the period 17,139 (24,321) 17,040 21,098 Depreciation and amortisation of PPE and RoU 34,549 37,203 4,425 12,136 Impairment 6,007 12,136 88 107C
Slide 40: DIS' Current Fleet Overview. LR1 & MR Fleet
DIS’CURRENT FLEET OVERVIEW. LR1 & MR Fleet Owned - LR1 Tonnage (dwt) Year Built Builder, Country Interest1 IMO Classified Cielo di Londra 75,000 2019 Hyundai MIPO, South Korea (Vinashin) 100% - Cielo di Cagliari 75,000 2018 Hyundai MIPO, South Korea (Vinashin) 100% - Cielo Rosso 75,000 2018 Hyundai
Slide 41: DIS' Current Fleet Overview. MR Fleet
DIS’CURRENT FLEET OVERVIEW. MR Fleet TC - IN Long Term with purchase option Tonnage (dwt) Year Built Builder, Country Interest1 IMO Classified High Leader 50,000 2018 Japan Marine United Co., Japan 100% IMO II/IMO III High Navigator 50,000 2018 Japan Marine United Co., Japan 100% IMO II/IMO III High
Slide 42: DIS' Current Fleet Overview. Handy Fleet
DIS’CURRENT FLEET OVERVIEW. Handy Fleet Owned Tonnage (dwt) Year Built Builder, Country Interest1 IMO Classified Cielo di Salerno 39,043 2016 Hyundai MIPO, South Korea (Vinashin) 100% IMO II/IMO III Cielo di Hanoi 39,043 2016 Hyundai MIPO, South Korea (Vinashin) 100% IMO II/IMO III Cielo di Capri 39
Slide 43: Thank you!
Thank you!
d'Amico International Shipping — Q2 2020 Earnings Presentation on 6ix