Euroseas Ltd. · NASDAQ:ESEA
Euroseas — Jefferies 6th Annual Shipping & Offshore Services Conference (September 2009)
29 slides from Euroseas's conference presentation, Sep 9, 2009
Slide 1: Presentation to Jefferies 6th Annual Shipping & Offshore Services Conference
Presentation to Jefferies 6th Annual Shipping & Offshore Services Conference September 9, 2009
Slide 2: Forward-Looking Statements
Forward-Looking g Statements Statements in this presentation may be "forward-looking statements" within the meaning of federal securities laws. The matters discussed herein that are forward forward-looking looking statements are based on current management expectations that involve risks and uncerta
Slide 3: Introduction & Milestones
Introduction & Milestones » Euroseas is a provider of worldwide dry cargo transportation services Owner of 17 ships – 6 Drybulk carriers – transporting iron ore, coal and grains and minor bulks – 11 Container and multipurpose ships – transporting dry and refrigerated cargoes » Corporate Profile • Fo
Slide 4: Acquisitions 2005-2009
Acquisitions q 2005-2009 Euroseas avoided investing at the peak of the market except for Ioanna P 70 Ioanna P 60 Dry Bulk (Panamax) Containership (1700 teu) 50 million $, 15--yr old vessels 40 Gregos 30 Artemis Aristides NP Maersk Noumea Tiger Bridge Clan Gladiator 20 Pantelis Despina/Jonathan Xinga
Slide 5: Vessel Acquisitions
Vessel Acquisitions q » Focus on segments with less supply growth and flexible trading patterns • Generally, handysize to panamax bulkers and up to 2,500 teu containerships • Evaluate each project on its own merits and risks » Consistent evaluation framework to identify entry points • At least 10% p
Slide 6: Fleet Renewal & Expansion Program
Fleet Renewal & Expansion p Program g » Bought: • “Monica P”, 46,667 dwt bulker, Japan ’98-blt for $18.0m • “Eleni P”, 72,118 dwt bulker, Japan ‘97-blt for $18.4m • “Pantelis”, 74,020 dwt bulker, Japan ’00-blt for $27.5m » Sold: • “Nikolaos P”, 34,000 dwt bulker, Spain ’84-blt for $2.4 m • “Ioanna I
Slide 7: Current Fleet
Current Fleet Name Type DWT TEU Built Pantelis Panamax 74,020 - 2000 Eleni P Panamax 72 119 72,119 - 1988 Irini Panamax 69,734 - 1993 Aristides NP Panamax 69,268 - 1997 Monica P Handymax 46,667 - 1998 Gregos Handysize 38,691 - 1984 Maersk Noumea Intermediate 34,677 2,556 2001 Tiger Bridge Intermedia
Slide 8: Fleet Management & Operational Performance
Fleet Management g & Operational p Performance Daily costs per vessel » Management is performed by Eurobulk Ltd., an affiliate 9,000 8,000 • Top management – 100+ years of industry 7,000 shipping hi i experience i 6,000 (*) $ / day • 4th generation of Pittas’ family managing 5,000 secondhand dry-car
Slide 9: Vessels Employment Chart - Bulkers
Vessels Employment p y Chart - Bulkers 100% coverage in Sep-Dec 2009 / 75% in 2010 NIKOLAOS P. Spot Sold PANTELIS P $25,200 $17,500 ELENI P $15,350 Spot Spot GREGOS / 150% FFA @ 7,000 / 80% FFA @ 7,450 MONICA P. Spot pool / 100% FFA @ 10,250 Spot / 100% FFA @ 10,950 IRINI Spot pool / 100% FFA @ 10,2
Slide 10: Vessels Employment Chart - Containerships
Vessels Employment p y Chart - Containerships p 50% coverage in Sep-Dec 2009 / 22% coverage in 2010 ARTEMIS laid-up Container Ship Vessels DESPINA P 15k laid-up Multi-purpose Vessel JONATHAN P $16,500 laid-up YM XINGANG I $26,650 $3,850 MANOLIS P $15,800 OEL TRANSWORLD $18,500 KUO HSIUNG 11k 6k $4,1
Slide 11: Rapid Debt Repayment
Rapid Debt Repayment Debt Repayment Schedule(1) – As of 9/1/2009 Cash Flow Breakeven $30 » $12.3 m less debt repayments in 2009 • $2,000 / day / vessel lower cash $25 $12.3m lower debt flow breakeven payments in 2009 $20 » Cash Flow Breakeven(2) rough estimate for next 12 months: million $15 $25.6 $
Slide 12: Dividend Declaration
Dividend Declaration $0.5 25% • Declared the 16th consecutive dividend of $0.4 20% $0.10 per share for the second quarter • Annualized yield of about 7.9% 7 9% ((1)) uarterly dividend annualized yield • One of the very few companies still paying $0.3 15% dividend • Intention to maintain policy of pr
Slide 13: Implementing Euroseas Strategy
Implementing p g Euroseas Strategy gy • Selectively acquire & sell vessels • At depressed market it is the time to buy younger ships • Residual value / charterer credit risk • Consistent long-term evaluation framework of each investment / project • Shows containerships potentially becoming attractiv
Slide 14: Market Overview: How We Going To Take Advantage of It?
Market Overview: How We Going To Take Advantage of It?
Slide 15: Panamax & 1700 teu Containership 10-yr Old Prices & 1-yr TC Rates
Panamax & 1700 teu Containership p 10-yr y Old Prices & 1-yr y TC Rates 1-Year TC Rates Secondhand Price, 10-Year Old Vessels 90 000 90,000 90 Panam ax 72-75,000 dw t Panamax 72-75,000 dwt 80,000 80 Containership 1700 teu Containership 1700 teu 70,000 70 60,000 60 million USD 50,000 50 $ / day 40 00
Slide 16: 2009 Market Update
2009 Market Update p » Dry Bulk: Strong Rebound in Q2, But Is It Sustainable? • Baltic B lti Dry D Index I d rose from f 650’ 650’s iin JJan ’09 tto 44,290 290 or so bby early l June J ’09 bbutt has h come ddown a bit since • Key reasons for market strength so far in 2009: – Record ppurchases of iro
Slide 17: Should We Revise Our Investment Thesis
Should We Revise Our Investment Thesis Are we “out-of-the-woods” out-of-the-woods , or, or not as yet? » Unexpected strength in the dry bulk market in the second quarter • April and May are seasonally strong months due to grain trade • Record levels of Chinese iron imports unsustainable » Containers
Slide 18: World GDP & Shipping Demand Growth
World GDP & Shipping Demand Growth Real GDP (% p.a.) 2006 2007 2008 2009F 2010F 2011-13F USA 33 3.3 25 2.5 11 1.1 -2 7 (-2.6) -2.7 (-2 6) 0 8 (1 0.8 (1.4) 4) 3.4 3 4 (1.8) (1 8) Eurozone 3.0 2.7 0.8 -4.8 (-3.4) 0.3 (0.2) 1.7 (1.8) Japan 2.8 1.9 -0.7 -6.0 (-6.5) 1.7 (0.3) 2.7 (1.2) China 10.5 11.2 9.
Slide 19: Drybulk Age Profile & Orderbook Delivery Schedule
Drybulk y Age g Profile & Orderbook Deliveryy Schedule Panamax Dry Bulk Dry AgeBulker Profile(1) Dry Bulk Orderbook (1) m dwt m dwt 30% 120 140.0 22.8% 130.0 110 120.0 100 110.0 90 100 0 100.0 50.0 13.5% 80 57.60 17.8% 90.0 16.9% 70 13.2% 80.0 70.0 12.5% 12.4% 60 38.70 60.0 37.4 23.4 27.7 10.4% 50 5
Slide 20: Containership Age Profile & Orderbook Delivery Schedule
Containership p Age g Profile & Orderbook Deliveryy Schedule Containership Age Profile(1) Container Orderbook (1) m TEU 6.4 m TEU 6.0 48.1 % 2.0 13.5% 5.6 16.0% 5.2 9.8% 4.8 1.6 44 4.4 3.02 10 8% 10.8% 13 .8% 0.79 4.0 3.6 1.2 1.31 3.2 0.6 0.7 2.8 21.5% 1.466 2.4 1.63 15.8% 0.8 0.44 20 2.0 1 21 1.21
Slide 21: Indicative Supply/Demand Balance Scenario
Indicative Supply/Demand pp y Balance Scenario Dry Bulk Container Orderbook - 65.2% (Sep-09) Orderbook - 40.5% (Sep-09) 2009H1 2009H2 2010 2011 2009 2010 2011 Trade Demand Growth(1) -3.5% -2.0% 3.0% 5.5% -8.5% 2.2% 10.0% Effect of congestion, piracy, productivity(2) 2.5% 1.5% - - 0.5% - - Delivery S
Slide 22: Market Trends & Opportunities - Bulkers
Market Trends & Opportunities pp - Bulkers » Unexpected strength in 1H09 due to record imports of steel related goods by China and port congestion • iron ore imports – up 32% in July 09 over July 08 » Strong demand by China expected to continue in 2009 and 2010 » If global economic recovery happens
Slide 23: Market Trends & Opportunities - Containerships
Market Trends & Opportunities pp - Containerships p » Freight g rates,, charter rates and vessel pprices at all time lows as demand down 10-15% on 1H09. » Container lines expected collectively to loose $20 billion in 2009. » Percentage of fleet in lay up peaked end March at around 12% • Has fallen b
Slide 24: Where Are We in the Cycle?
Where Are We in the Cycle? y 10-yr y old Price Historical Range g 90 80 Max, 1999-2009 » Drybulk prices around historical Av erage, 1999-2009 70 average g of last ten yyears: Mi 1999-2009 Min, 1999 2009 60 Current, Sep-2009 • Above average if the high price period (‘07-Oct’08) is excluded 50 » Conta
Slide 25: Euroseas Financial Position
Euroseas Financial Position » Cash @ June 30, 2009: $ 56.2m • Also restricted cash of about $12.2m » D bt $69.5 Debt: $69 5 m as off June J 30, 30 2009 • Debt to Capitalization ratio about 22% • Agreed to draw debt of 13m to finance purchase of Pantelis (bought for about $27.5m) – Proforma: $41 $41.
Slide 26: Euroseas Contacts
Euroseas Contacts Euroseas Ltd. Aethrion Center 40, Ag. Konstantinou Street 151 24 Maroussi, Greece www.euroseas.gr euroseas@euroseas.gr Tel. +30-211-1804005 Fax.+30-211-1804097 or, Tasos Aslidis Nicolas Bornozis Chief Financial Officer Investor Relations Euroseas Ltd. Capital Link, Inc. 11 Canterbu
Slide 27: Appendix: Financial Highlights
Appendix: Financial Highlights Page 27
Slide 28: Financial Highlights: 2nd Quarter and 1st Half of 2008 and 2009
Financial Highlights: g g 2nd Quarter and 1st Half of 2008 and 2009 Second Quarter First Half as as (5) (5) (in million USD except per j adjusted change g j adjusted change g (4) share amounts) 2008 2009 % (4) 2008 2009 % Net Revenues $34.5 $14.8 -56.9% $67.3 $30.2 -55.2% Net Income $15.6 ($5.4) $29
Slide 29: Fleet Data for 2nd Quarter and 1st Half of 2008 and 2009
Fleet Data for 2nd Quarter and 1st Half of 2008 and 2009 Fleet Statistics Second Quarter First Half 2008 2009 2008 2009 (unaudited) (unaudited) (unaudited) (unaudited) Number of vessels 15.44 16.00 11.46 15.62 Utilization Rate (%) Overall(1 ) 98.8% 96.9% 99.1% 94.6% Commercial(1 ) 100.0% 97.6% 99.7%
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