Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Norden — Q2 2020 Earnings Presentation
28 slides from Dampskibsselskabet Norden A/s's earnings presentation, Aug 19, 2020
Slide 1: Presentation of Q2 2020 Results
PRESENTATION OF Q2 2020 RESULTS Copenhagen, Denmark, 19 August 2020
Slide 2: Agenda for Today
AGENDA FOR TODAY 01. Highlights Q2 02 Market outlook • Dry cargo • Tanker 03. Final words 04. Q&A 2 PRESENTATION OF Q2 2020 RESULTS
Slide 3: Highlights Q2 2020
01. HIGHLIGHTS Q2 2020 3 PRESENTATION OF Q2 2020 RESULTS
Slide 4: Business Update
01. HIGHLIGHTS Q2 AND H1 2020 BUSINESS UPDATE Great Q2 result • Adjusted Result Q2 2020 USD 29 million (Q2 2019: USD -12 million) • Raising guidance to USD 40-80 million Quarterly Adjusted Results 35 • Primarily due to improved expectations in Dry Operator 31 30 29 29 Business highlights Q2 25 • Ass
Slide 5: Substantial Value Beyond Asset Values
01. HIGHLIGHTS Q2 2020 SUBSTANTIAL VALUE BEYOND ASSET VALUES Asset Management Dry Operator Tanker Operator Active management of cyclical Providing efficient global transport Providing efficient global transport market exposure within dry cargo solutions to customers and active solutions to and activ
Slide 6: Business Unit Performance and Market Outlook
02. BUSINESS UNIT PERFORMANCE AND MARKET OUTLOOK 6 PRESENTATION OF Q2 2020 RESULTS
Slide 7: Asset Management: Results and Key Development
02. ASSET MANAGEMENT RESULTS AND KEY DEVELOPMENT Adjusted result in Q2 USD 11 million Asset Management Adjusted Result by • Adjusted Result for the last 4 quarters USD 19 million quarter • EBIT in Q2 USD 17 million 12 • Capitalising on low dry cargo asset values: Bought 4 Supramax 10 N/Bs during Q2;
Slide 8: Dry and Tanker Market in Q2 2020
02. ASSET MANAGEMENT DRY AND TANKER MARKET IN Q2 2020 Dry cargo market bottoming out Tanker market declining after spike • NORDEN benefitting from high coverage in Dry Cargo during Q2 • Short-lived, strong spike in tanker rates due to significant storage • The price of a 5-year-old Supramax fell by
Slide 9: Market Outlook, Dry Cargo
02. ASSET MANAGEMENT MARKET OUTLOOK, DRY CARGO Supply growth slowing down from here Dry cargo demand rebounding • Chinese infrastructure investments to support commodity demand: RoW • Orderbooks are coming down to follow in late 2021 • The market absorbed a large part of dry dock vessels returning •
Slide 10: Market Outlook, Tanker
02. ASSET MANAGEMENT MARKET OUTLOOK, TANKER Weak demand outlook Attractive supply outlook • High stocks and weak oil demand reducing transportation demand • Order books remain historically low • Oil supply to adjust upwards driven by higher oil prices and reversal • Fleet age profile should allow fo
Slide 11: Dry Operator: Building Value for H2
02. DRY OPERATOR BUILDING VALUE FOR H2 Adjusted result of USD -4 million in Q2 Signs of slow improvements • Last four quarters of USD 18 million and margin of USD 183 pd • Spot rates hit record low in end-April • Entered Q2 with high cargo coverage – protected earnings • Both forward rates and spot
Slide 12: Tanker Operator: Attractive Cover Reducing Forward Exposure
02. TANKER OPERATOR ATTRACTIVE COVER REDUCING FORWARD EXPOSURE Adjusted result of USD 22 million in Q2 Rates plummeting after spike • Last four quarters of USD 49 million • Historical strong spot rates in May – normalised in just a couple of • Perfectly positioned for rate spike - Fleet size activel
Slide 13: 2020 Guidance and Final Words
03. 2020 GUIDANCE AND FINAL WORDS 13 PRESENTATION OF Q2 2020 RESULTS
Slide 14: 2020 Guidance
03. 2020 GUIDANCE NORDEN raises its guidance to an Adjusted Result for 2020 of USD 40 to 80 million. Asset management Dry operator Tanker operator • Still expects significant improvement in • Adjusted Result above that for 2019 • Adjusted result higher than in 2019 profits compared to 2019 • Based o
Slide 15: So Much More Than Just Owned Vessels
03. FINAL WORDS SO MUCH MORE THAN JUST OWNED VESSELS… • Great Q2 result in challenging environment • Raising guidance to USD 40-80 million: - Expecting improved Dry Operator performance in H2 • Capital allocation: - Tactical investments in cheap dry cargo asset opportunities - Committed to asset lig
Slide 16: Forward Looking Statements
03. FINAL WORDS – DISCLAIMER 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 2020 and subsequent years are subject to uncertainty, and NORDEN’s actual
Slide 17: Thank You for Your Attention
THANK YOU FOR YOUR ATTENTION Dampskibsselskabet NORDEN A/S 52, Strandvejen DK-2900 Hellerup Denmark Phone: +45 3315 0451 www.ds-norden.com Connect with us 17 PRESENTATION OF Q2 2020 RESULTS
Slide 18: Appendix
04. APPENDIX 18 PRESENTATION OF Q2 2020 RESULTS
Slide 19: NORDEN – Enabling Smarter Global Trade
04. APPENDIX NORDEN – ENABLING SMARTER GLOBAL TRADE Since 1871, NORDEN has built a reputation for providing reliable and efficient transport solutions to customers across the world. The Copenhagen-listed group offers shareholders earnings from industry-leading operator and owner activities generated
Slide 20: H1 Income Statement
04. APPENDIX H1 INCOME STATEMENT USD million Q2 2020 Q2 2019 H1 2020 H1 2019 FY 2019 USD million Q2 2020 Q2 2019 H1 2020 H1 2019 FY 2019 Revenue 615.7 624.6 1,230.3 1,278.1 2,583.9 Financial income 1.6 1.6 2.5 3.3 5.1 Other operating income 3.4 3.9 9.7 7.9 16.3 Financial expenses -7.7 -9.4 -15.8 -20
Slide 21: Q2 2020 Financial Statement - Segments
04. APPENDIX Q2 2020 FINANCIAL STATEMENT - SEGMENTS USD million Asset Management Dry Operator Tanker Operator Eliminations Total 2. Segment information Revenue – services rendered, external 29.6 437.7 147.9 0.0 615.2 Revenue – services rendered, internal 68.4 0.0 0.0 -68.4 0.0 Revenue – sublease fin
Slide 22: Cash Flow
04. APPENDIX CASH FLOW No Q2 Q2 H1 H1 FY Q2 Q2 H1 H1 FY USD million USD million Note te 2020 2019 2020 2019 2019 2020 2019 2020 2019 2019 Profit/loss for the period 29.0 -8.4 56.7 -13.7 19.2 Dividend paid to shareholders -14.7 -12.0 -14.7 -12.0 12.0 Reversal of items from the income statement 63.2 5
Slide 23: Asset Management Fleet
04. APPENDIX ASSET MANAGEMENT FLEET Asset Management fleet Dry Cargo Tanker Total Active fleet Owned vessels* 12 24 36 Leased vessels* 39 17 56 Total active 51 41 92 For delivery Owned vessels* 6 0 6 Leased vessels* 3 10 13 Total for delivery 9 10 19 Purchase options 39 24 63 Period option days 38,3
Slide 24: Major Shipping Trends
04. APPENDIX MAJOR SHIPPING TRENDS Decarbonisation Shorter shipping cycles A changing China story Digitalisation • Climate change is a driver • Increased uncertainty and • Chinese economy develop • The industry is still highly complexity towards being less commodity analogue • Decreased global use o
Slide 25: NORDEN's Transformation
04. APPENDIX NORDEN’S TRANSFORMATION NORDEN has transitioned to a new business unit structure, which brings more agility and focus. This transition will facilitate: Higher risk adjusted returns Better performance Beyond NAV • Short term trading-oriented • Transparency by establishment • Clear value
Slide 26: Business Unit Structure
04. APPENDIX BUSINESS UNIT STRUCTURE Asset Management Dry Operator Tanker Operator Active management of cyclical Providing efficient global transport Providing efficient global transport market exposure within dry cargo and solutions to customers and active solutions to and active management of prod
Slide 27: Business Unit Value Drivers
04. APPENDIX BUSINESS UNIT VALUE DRIVERS Market Regional Options Employment Clip deals Vessel Vessel Minimising Technical Pool exposure exposure arbitrage selection operation ballast management Management Taking a view on Taking a view on Securing and Choosing Securing margin Evaluating Speed settin
Slide 28: The Share (DNORD)
04. APPENDIX THE SHARE (DNORD) MASTER DATA COMPOSITION OF SHAREHOLDERS Shareholder capital DKK 42,200,000 International ownership share counted 634 registered shareholders, in aggregate owning 28.1% of the share capital Number of shares and denomination 42,200,000 shares of DKK 1 Classes of shares 1