Ardmore Shipping Corporation · NYSE:ASC
Ardmore Shipping — Investor Presentation (December 2013)
26 slides from Ardmore Shipping's investor presentation, Dec 20, 2013
Slide 1: Ardmore Shipping Corporation Investor Presentation December 2013
ARDMORE SHIPPING CORPORATION Investor Presentation December 2013
Slide 2: Disclaimer
Disclaimer This presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of applicable U.S. federal securities laws. All statements, other than statements of historical facts, that address activities, events or developments that Ardmore Shippi
Slide 3: Ardmore Shipping Corporation
Ardmore Shipping Corporation
Slide 4: Company and Investment Highlights
Company and Investment Highlights Attractive Fleet of Fuel-Efficient “Eco” Vessels Close Working Relationships with High Quality Customers Highly Selective Ship Acquisition Program Positive Market Outlook Driven By Secular and Cyclical Trends In-House Management with Low Cost Operations Dedicated Ma
Slide 5: A Versatile and Complementary Fleet
Fleet of modern, fuel-efficient mid-size product and chemical tankers – 21 in water or on orderThe majority of seaborne transport capacity for products and chemicals carried on these sizes Broad markets with increasing overlap between the two sectors Large MR product tanker market with over 1,800 sh
Slide 6: Our Fleet
Fleet of modern ships built at high-quality shipyards with significant upgrades to improve fuel efficiency and commercial capabilities Our Fleet
Slide 7: Delivery Schedule and Newbuild Progress
Delivery Schedule and Newbuild Progress Scheduled/Contracted Fleet Development Deliveries: tbn Ardmore Seamariner expected in December 2013 tbn Ardmore Seavantage (S-5118) and tbn Ardmore Seavanguard (S-5119) expected in January 2014Steel cutting on Fukuoka Hull 2062 completed on November 5, 2013 By
Slide 8: High Quality Customers & Diversified Employment Strategy
High Quality Customers & Diversified Employment Strategy *Assumes continued employment under evergreen agreements. 2013 2015 2014 Short Term Charters Allow for Market Upside
Slide 9: Ardmore: Competitive Strengths
Ardmore: Competitive Strengths
Slide 10: Ardmore Focuses on a Broad Range of High Growth Cargos
Gasoline Diesel Kerosene Jet Fuel Naphtha Clean Petroleum Products (CPP) Chemicals* * Certain chemicals such as Caustic Soda can be carried on IMO3 ships. However the vast majority of inorganic chemicals must be carried on IMO2 ships and acid based cargos are only suitable for stainless steel ships.
Slide 11: Strong Management Team with Proven Track Record
Decades of experience with market leaders in our industry Strong Management Team with Proven Track Record
Slide 12: Fully Integrated Management and a Transparent Corporate Structure
Incentives Aligned with Shareholders Ardmore’s management functions are carried out in-houseNo vessel management / sale & purchase fees paid to related partiesCorporate structure designed to provide flexibility as well as transparencyVessel-owning entities are domiciled in the Marshall Islands and a
Slide 13: On the Forefront of The Drive for Fuel Efficiency
Vessel Operating Cost per Day Historical Bunker Fuel Prices Ardmore Vessel Fuel Consumption Comparison (1) Average consumption delta of 4 MT/day equates to savings of ~$2,500/day at sea Source: Drewry, Ardmore data, publicly disclosed market information.(1) Amounts based on 12.5 – 13.0 KTS laden for
Slide 14: Product & Chemical Tanker Market
Product & Chemical Tanker Market
Slide 15: Products and Chemicals: Large Markets Benefiting from Positive Trends
Secular Trends Shifts in refinery capacityU.S. shale revolutionEmerging economiesIncreasing trading complexity Cyclical Recovery Global economic recovery Demand growth exceeds tanker supply growthConstraints on further supply growth Products and Chemicals: Large Markets Benefiting from Positive Tren
Slide 16: Refinery Capacity Evolution and Emerging Markets Driving Product Demand
Refinery Capacity Evolution Emerging Markets Driving Product Demand (1) Divergent growth rates of refinery capacity are contributing to incremental seaborne product demand Geographic Shifts in Refinery Capacity Leading to Longer Trade Routes Source: Drewry, BP Statistical Review 2013.(1) Represents
Slide 17: Shale Production Expected to Boost Product and Chemical Tanker Demand
The U.S. shale oil and gas revolution is fundamentally reshaping the global energy landscape:U.S. now a major net exporter of products Shipping to Europe, South America and more recently to the Far East U.S. exports are an important component of MR demandLow cost feedstock is set to give the U.S. a
Slide 18: Product Tanker Market Drivers
DEMAND:Strong secular trendsEnhanced by cyclical recovery now underwayExpected near-term demand growth of ~4%SUPPLY:Orderbook has fallen from high of ~59% to a current level of ~13%(3)Expected fleet growth ~3% p.a. over next 3 years net of anticipated continued scrapping(4)32 units in competitive si
Slide 19: Chemical Tanker Market Drivers
DEMAND:Closely correlated to global GDP growth but magnified by emerging economies demandTonne-mile expansion expected from:Middle east petrochemical plant expansionU.S. shale gas – driven expansionSeaborne trade of chemicals has increased at an average rate of ~5% per year since 2001SUPPLY:Orderboo
Slide 20: We are Investing at an Attractive Point in the Cycle
Historical MR2 Charter Rates (Inflation-Adjusted) Historical MR2 Asset Values (Inflation-Adjusted) Charter rates and asset values remain well below historical averages and Ardmore’s fleet has been assembled at an attractive point in the cycle Source: Drewry, Bureau of Labor Statistics.Note: Charter
Slide 21: Ardmore: Financial Highlights
Ardmore: Financial Highlights
Slide 22: Ardmore Benefiting from a Strengthening Market
Time Charter Equivalent ($ / day) Ardmore has substantial operating leverage and has delivered strong sequential performance Ardmore Benefiting from a Strengthening Market (1) Calculations based on existing cost structure and assume a fully-delivered fleet of 21 vessels, assumed utilization of 99.45
Slide 23: Conservatively Capitalized
Conservative leverage34.2% at September 30, 2013No near-term loan maturitiesAmple Room on CovenantsRequired cash of $600k per vessel Value maintenance: 125% - 150%Corporate Leverage <75%No dividend restrictionExcellent relationships with leading shipping banks Progressing discussions with banks for
Slide 24: Dividend Policy Demonstrates Commitment to Returning Excess Cash to Shareholders
Yield Comparison Across Securities Dividend Policy Demonstrates Commitment to Returning Excess Cash to Shareholders Source: Bloomberg, Yieldbook as of 7/19/13.
Slide 25: Investment Highlights
Investment Highlights A focused and consistent strategyModern, fuel efficient “eco” fleetInternal management structure Low cost structure – asset, operations, overheadProduct tanker rates still 50% below prior cyclical peaksAt Jan 31, 2014, 52% of our fleet in operation and contributing to cash flow
Slide 26: Thank you
Thank you
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