D'amico International Shipping S.a. · MIL:DIS
D'amico International Shipping — Q3 2022 Earnings Presentation
63 slides from D'amico International Shipping's earnings presentation, Nov 10, 2022
Slide 1: Q3 & 9M 2022 Presentation
Q3 & 9M 2022 Presentation d’Amico International Shipping November 10th, 2022
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 ▪ Market overview ▪ Why invest in DIS ▪ DIS’ ESG ▪ Appendix
Slide 4: Executive summary
Executive summary. • Net result – d’Amico International Shipping SA (“DIS” or “the Company”) recorded a Net profit of US$ 62.8m in the first 9M’22 vs. a Net loss of US$ (28.9)m in the same period of last year and a Net profit of US$ 43.6m in Q3’22 vs. a Net loss of US$ (13.8)m in Q3’21. Adjusted net
Slide 5: Executive summary
Executive summary. • Acquisition of the full control of Glenda International Shipping d.a.c. – In Q3’22, DIS gained control of 100% of Glenda International Shipping d.a.c., through the redemption of the shares owned by Topley Corporation (part of the Glencore Group) in the JV for a consideration of
Slide 6: DIS' overview
L. Veritoo INTERNATIONAL SHIPPING 5.4 . ‘S ES
Slide 7: A modern, high-quality and versatile fleet
A modern, high-quality and versatile fleet. September 30th, 2022 DIS Fleet1 LR1 MR Handy Total % Owned 5.0 8.0 6.0 19.0 52.8% Bareboat chartered 1.0 7.0 0.0 8.0 22.2% Time chartered-in long-term 0.0 9.0 0.0 9.0 25.0% Time chartered-in short-term 0.0 0.0 0.0 0.0 0.0% TOTAL 6.0 24.0 6.0 36.0 100.0% •
Slide 8: Rapidly declining CAPEX commitments
Rapidly declining CAPEX1 commitments. Investment plan US$/mm 250.0 DIS has no remaining newbuilding CAPEX, having fully completed its long-term investment 194.6 plan in FY’19. ‘Vessel acquisition’ in ROY’22 200.0 3.9 164.4 151.1 refer to the exercise of the purchase option on High Adventurer. 12.8 0
Slide 9: Lighter bank debt repayments and low refinancing risk
Lighter bank debt repayments and low refinancing risk. Forecasted bank debt financing cash-flow Daily bank loan repayment on owned vessels (Excluding overdraft facilities)1,2,3 (Excluding overdraft facilities)1,2,3 US$/mm US$/mm US$/mm US$/day 60 6,500 200 40 6,147 150 - 30 6,000 50 100 159.5 14.3 2
Slide 10: DIS' purchase options on leased vessels
DIS’ purchase options on leased vessels. Purch. Build Purch. Option First Ex. Option (In/Out of Vessel Name Obligation 1 Date First Ex. Date the money) Date High Priority2 Mar-05 Oct-19 Oct-22 Exercised in Q1'21 High Freedom Jan-14 Feb-20 Feb-24 In the money High Fidelity Aug-14 May-20 May-27 Exerci
Slide 11: DIS' purchase options on time-chartered-in vessels
DIS’ purchase options on time-chartered-in vessels Build Purch. Option Purch. Option First Ex. Option (In/Out of Vessel Name Date First Ex. Date Last Ex. Date the money) Crimson Jade Jun-17 Jun-21 Dec-26 In the money Crimson Pearl Aug-17 Aug-21 Feb-27 In the money High Adventurer Nov-17 Nov-21 Nov-2
Slide 12: Contracts and modern fleet to drive future results
Contracts and modern fleet to drive future results. Average TC and TC equivalent covered rates1 • Average contract rates rise while the proportion of the % of ‘employment days’ US$/day fleet covered falls in Q4 ’22 and ‘23, providing valuable exposure to an ongoing market recovery. 70% 36,000 60% 31
Slide 13: Earnings outlook for Q4 2022
Earnings outlook for Q4 2022. DIS’ current earnings outlook for Q4’221 • Contract coverage: DIS has fixed ~20% of its Q4’22 employment days at a daily average of US$ 20,544. % of ‘employment days’ US$/day 100% 35,000 • Fixed spot days: DIS has fixed ~46% of its Q4’22 90% employment days on spot voya
Slide 14: Large potential upside to earnings
Large potential upside to earnings. Estimated fleet evolution (avg. n. of vessels)1 Potential upside to earnings2 N. of ships (based on ‘available days’) US$/mm 40 40 36.0 35.9 0.0 34.1 35 35 1.9 8.0 8.0 30 30 8.0 25 7.9 25 8.5 4.2 20 20 33.7 35.5 15 15 10 19.5 20.0 20.0 10 5 5 11.2 11.8 3.3 0 0 1.1
Slide 15: DIS focused also on cost savings
DIS focused also on cost savings. Daily operating costs – owned and General & administrative costs – total fleet bareboat vessels1 US$/day US$/m 7,400 14.0 7,200 12.0 7,000 10.0 6,800 8.0 6,600 7,280 6.0 12.1 11.3 10.2 9.1 9.3 6,400 6,732 4.0 6,716 6,706 6,718 6,200 2.0 6,000 0.0 9M'18 9M'19 9M'20 9
Slide 16: First 9M'22 Net financial position
Financial results. First 9M’22 Net financial position (US$ million) Dec. 31st, 2021 Sep. 30th, 2022 Gross debt (485.9) (491.8) IFRS 16 – additional liabilities (80.5) (54.1) Cash and cash equivalents 43.4 85.1 Other current financial assets1 2.7 6.9 Net financial position (NFP) (520.3) (453.9) Net f
Slide 17: First 9M'22 Results
Financial results. First 9M’22 Results (US$ million) Q3’21 Q3’22 9M’21 9M’22 Non-recurring items: TCE Earnings 42.1 94.2 131.0 209.8 (US$ million) Q3’21 Q3’22 9M’21 9M’22 Total net revenue 42.1 95.4 131.0 213.4 Result on disposal of vessels (0.5) (0.5) (1.6) (1.6) Result on disposal of vessels (0.5)
Slide 18: First 9M'22 Key operating measures
Financial results. First 9M’22 Key operating measures Key Operating Q1 2021 Q2 2021 Q3 2021 9M 2021 Q4 2021 FY 2021 Q1 2022 Q2 2022 Q3 2022 9M 2022 Measures Avg. n. of vessels 38.8 38.0 38.0 38.3 37.7 38.1 36.1 35.5 35.3 35.6 Fleet contact 49.5% 46.7% 48.4% 48.2% 45.5% 47.5% 44.5% 39.8% 32.0% 38.8%
Slide 19: Market overview – market fundamentals
Market overview – market fundamentals
Slide 20: Large potential upside to asset values
Large potential upside to asset values. Historical MR TC and spot rates1 Historical MR asset values1 US$/day US$/m 45,000 40,000 1 YR TC is still ~10% below the last 60 35,000 cycle peak, whilst Spot rates reached 55 NB, 5yr old and 10yr old vessels are an all-time high in Sep’22 respectively ~19%,
Slide 21: The Ukrainian war and trade flows
The Ukrainian war and trade flows. Russian Crude and DPP exports to China, India and Turkey (mb/day)1 1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0 01/21 02/21 03/21 04/21 05/21 06/21 07/21 08/21 09/21 10/21 11/21 12/21 01/22 02/22 03/22 04/22 05/22 06/22 07/22 08/22 09/22 • Exports of Russian Crude and DPP t
Slide 22: The Ukrainian war and oil supply
The Ukrainian war and oil supply. • Russian oil output has proven resilient so far in ‘22. As sanctions in Europe and the UK come into full force at the end of ‘22, there is however a risk that next year Russian oil production could be more severely affected. The IEA in its Oct‘22 report forecasts a
Slide 23: Covid-19, the receding impact of the new variant
Covid-19, the receding impact of the new variant. UK Covid-19 metrics as a percentage of their peak value last winter1 350% 300% 250% 200% 150% 100% 50% 0% Cases Vented Patients Deaths Thanks to the widespread vaccination campaigns, as well as to the lower mortality of the new variants relative to s
Slide 24: Oil demand and refining throughputs recovering
Oil demand and refining throughputs recovering. Global oil demand1 Global refinery throughputs1 Million barrels per day Million barrels per day 105.0 102.9 90.0 102.1 100.4 100.6100.9 84.1 99.5 100.6 85.0 82.9 82.9 83.1 100.0 99.0 82.1 81.2 81.8 82.1 81.8 98.8 100.0 100.6 80.6 80.1 80.2 99.4 98.5 98
Slide 25: Refined product inventories at very low levels
Refined product inventories at very low levels. Crude oil price (Brent, US$ bbl), forward curve1 CPP vs DPP and crude oil floating storage2 Million barrels 94 92.5 350 325 92 90.6 300 89.1 275 90 250 87.7 225 88 86.6 200 85.6 175 86 84.8 150 84.1 125 83.4 84 82.8 100 82.3 81.8 75 81.3 82 50 25 80 0
Slide 26: Very tight diesel market, especially in the US
Very tight diesel market, especially in the US. US Middle distillate stocks by PADD1 Refining Cracks1 80 kbbls Description Current 10y median 2021 Of total vs 10y vs 2021 60 Total 106 127 125 40 PADD1 East Coast 24 42.7 38.7 23% 56% 62% PADD2 Midwest 24.6 28.6 31 23% 86% 79% 20 PADD3 Gulf Coast 42.8
Slide 27: Vehicle demand recovery dampened by high-oil prices
Vehicle demand recovery dampened by high-oil prices. US interstate vehicle miles traveled S. Europe traffic performance vs. L. America traffic performance vs. (VMT) vs. same week of 20191 same week of 20192 same week of 20192 % change vs. same % change vs. same % change vs. same week in 2019 week in
Slide 28: Jet fuel demand still rising strongly
Jet fuel demand still rising strongly. % Change in number of commercial flights vs. 20191 Jet fuel2 demand by use vs 2019 Pre-Covid (mbpd) 10% 140% 0% 120% May-20 May-21 May-22 Jul-20 Feb-20 Mar-20 Apr-20 Feb-21 Mar-21 Apr-21 Jul-21 Feb-22 Mar-22 Apr-22 Jul-22 Oct-20 Oct-21 Oct-22 Nov-20 Dec-20 Nov-
Slide 29: Support also from strong crude tanker market
Support also from strong crude tanker market1. LR2 Fleet clean vs. dirty trading Crude tankers’ orderbook % Fleet (dwt) 100% 3% 3% 3% 2% 2% 3% 2% 45.0% 90% 40.0% 80% 39% 38% 36% 42% 40% 35.0% 46% 47% 70% 30.0% 60% 50% 25.0% 40% 41.1% 20.0% 36.9% 30% 60% 62% 35.8% 55% 59% 57% 31.8% 51% 50% 15.0% 20%
Slide 30: Longer-term demand: healthy and resilient growth
Longer-term demand: healthy and resilient growth. World seaborne refined products trade1 Billion Tonne-miles ‘21-’23 CAGR: 8.1% 4,000 ‘00-’19 CAGR: 3.6% 3,500 • Seaborne demand for the transportation of refined products 3,000 contracted sharply in 2020 before 2,500 a strong rebound in 2021, which is
Slide 31: Longer-term demand: changes in the refinery landscape
Longer-term demand: changes in the refinery landscape. Portion of net refinery capacity additions ‘21-’26 40% • Global refinery crude distillation capacity should rise by 4.8m b/d 30% in the ‘21-26 period. 20% • ~91% of the planned refinery net capacity additions in the ‘21- 28% 28% 34% ’26 period a
Slide 32: Longer-term demand: US shale oil
Longer-term demand: US shale oil EIA’s US oil production (mbd)1 US horizontal oil rigs (lhs) vs WTI (US$ bl, rhs)2 13.5 1500 130 13.0 120 13.0 12.8 1300 110 12.6 100 12.5 12.2 1100 90 12.0 80 11.6 900 70 11.5 60 700 50 11.0 500 40 30 10.9 10.5 300 20 10 10.0 100 0 9.7 9.9 Jan-17 Jan-15 Jul-15 Jan-16
Slide 33: Several forces spurring demolition
Several forces spurring demolition. Scrap steel price1 US$/ldt 800 22-Apr-2022, 680 700 10-Oct-2014, 510 600 500 400 19-Aug-2011, 445 28-Oct-2022, 590 300 200 17-Jul-2020, 270 04-Mar-2016, 240 100 0 Aug-2010 Aug-2020 Aug-2011 Aug-2012 Aug-2013 Aug-2014 Aug-2015 Aug-2016 Aug-2017 Aug-2018 Aug-2019 Au
Slide 34: Growing pool of demolition candidates
Growing pool of demolition candidates. Historical and forecasted fleet composition by age (MRs and LR1s) (dwt, as at period end) 70% 60% 57.9% 50% 48.7% 40% 39.6% 33.1% 30% 28.3% 20% 15.9% 24.9% 12.5% 13.7% 20.8% 13.3% 16.0% 8.9% 8.2% 6.9% 7.5% 9.7% 10% 11.1% 8.0% 5.7% 6.4% 6.2% 0% 4.2% 5.6% 5.4% 4.
Slide 35: Planned deliveries to slow sharply in coming months
Planned deliveries to slow sharply in coming months. MR & LR1 deliveries, 2022-20231 30 25 20 N. Of vessels 15 26 10 19 18 18 17 16 15 5 7 7 6 4 0 Q1'22 Q1'23 Q2'22 Q2'23 Q3'22 Q3'23 Q4'22 Q4'23 Estimated deliveries Actual deliveries MR & LR1 demolitions, 2018-20221 20 18 16 N. Of vessels 14 12 10 1
Slide 36: Limited newbuild orders
Limited newbuild orders. MR Newbuilding parity curve vs MR & LR1 orders2 second-hand values1 Period end US$ Million N. of vessels orderbook/fleet ratio 50.0 250 70% 44.5 45.0 61% 36.8 60% 40.0 200 39.0 47% 35.0 50% 29.1 30.0 150 40% 25.0 28.0 21.4 31% 20.0 30% 100 19.0 21% 15.0 17% 16% 16% 20% 13% 1
Slide 37: 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 33.1% of current fleet Million Dwt 12 12% Million Dwt 11.3% 11.6%11.9% 10 9.7% 10% 45 42.0 9.5% 8.7% 8 8% 40 6.9% of current fleet 3.1% of current fleet 6 6% 35
Slide 38: Why invest in DIS
Why invest in DIS
Slide 39: Historical NAV evolution
Historical NAV evolution. DIS’ Historical NAV evolution1,2,3 US$/m US$/share 1000 1.20 900 0.98 0.98 1.00 800 0.89 700 0.78 0.76 611 0.80 0.69 600 500 0.56 0.55 0.60 406 421 0.50 0.42 348 0.44 400 327 340 0.35 286 0.36 309 0.34 0.31 262 0.40 300 246 233 230 0.28 0.25 0.24 0.21 0.20 200 0.16 0.14 0.2
Slide 40: 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 (78% of owned and bareboat ships) and IMO classed (78% of owned and bareboat ships). • First-class in-house technical management provides
Slide 41: DIS' ESG
BA INTERNATIONAL SHI Vy “3
Slide 42: DIS' Core Values
DIS’ CORE VALUES. Long term vision Guided by the values of family tradition, we build our success on long term planning and turning our promises into actions. Focus onthe environment and safety We do not compromise when it comes to environmental concerns. Care and attention, prudence and respect for
Slide 43: DIS' ESG at a glance
DIS’ ESG at a glance. DIS’ Key facts and DIS Industry DIS DIS’ Key facts and figures: figures: Figures Average Figures Lost Time Injury ✓ IMO Classed Fleet (%) 1 76% 44% ✓ Frequency (LTIF YTD)2,6 0 Owned and bareboat Percentage of female ✓ fleet Age (Years) 1,3 7.1 12.3 ✓ colleagues onshore2 43.5% O
Slide 44: DIS' ESG – Environment and Safety
DIS’ ESG – Environment and Safety DIS seeks to be an industry leader on environmental and safety issues: • Among the first fleets worldwide compliant with Monitoring Reporting and Verification criteria for CO2 emissions. • Since 2011 DIS has a fleet performance monitoring department to optimize vess
Slide 45: DIS' ESG – Environmental KPIs
DIS’ ESG – Environmental KPIs. 2019 2020 2021 Var % 20-21 C02 emissions, total fleet CO2 (Millions tons) Scope 1 0.607 0.578 0.505 -12.6% AER (g C02/dwt tonne*miles) 6.74 6.44 6.22 -3.4% EEDI/EEXI (g Co2/dwt tonne* Miles) 4.96 4.96 4.70 -5.2% EEOI (g C02/tonne* miles) 16.10 16.18 15.78 -2.50% SOx em
Slide 46: DIS' ESG – Corporate Governance
DIS’ ESG – Corporate Governance DIS is listed on the most demanding segment of the Milan stock exchange (the Star), and has therefore adopted a first-class corporate governance framework: • Listed on the Star segment of the Milan Stock Exchange since 2007; • High standards of corporate governance: •
Slide 47: DIS' ESG – Social responsibility
DIS’ ESG – Social responsibility DIS seeks a diverse and inclusive work environment, where team work is highly valued. The high levels of employee satisfaction result in high retention rates. • 23 onshore personnel as at 31 December 2021; • 558 seagoing personnel as at 31 December 2021; • 96% retent
Slide 48: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable DIS’ Sustainable DIS’ Sustainable Sustainability Development Sustainability Development Sustainability Development Topics Goals Topics Goals Topics Goals Vessel energy Integrated Ship recycling efficiency management system for ongoing improvement
Slide 49: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable Activity performed by DIS Sustainability Topics Development Goals Vessel energy efficiency • Renewal of the fleet with “Eco” vessels, in line with IMO directives, thanks to the implementation of innovative technologies. Innovation: • Projects aime
Slide 50: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable Activity performed by DIS Sustainability Topics Development Goals Integrated management • Transparent statement of policies governing operations on board managed ships - in system for ongoing order to ensure safety and efficiency - and of the meth
Slide 51: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable Activity performed by DIS Sustainability Topics Development Goals Ship recycling • Preparation of hazardous material inventories on all new buildings and on the existing fleet. Stakeholder engagement • Stakeholder mapping and detection of needs an
Slide 52: Appendix
INTERNATIONAL SHIPPING SA
Slide 53: DIS' Shareholdings Structure
DIS’ Shareholdings Structure. Key Information on DIS’ shares 3 d'Amico International SA 65.67% Others 32.87% d'Amico International Shipping SA 1.46% 2 100.00% 1 Listing market Borsa Italiana, STAR No. of shares issued 1,241,065,569 Market capitalisation1 €416.3 million Shares repurchased / % of shar
Slide 54: d'Amico Group Structure
d’Amico Group Structure. 100% d’Amico Società di Navigazione Spa d’Amico International S.A. 100% 100% d’Amico Shipping Ishima Pte Ltd Italia SpA 51% 85% Mida Maritime Rudder S.A.M. Company d.a.c 76.9% 100% Sirius Ship d’Amico Dry d.a.c. Management S.r.l. 65.65% d’Amico International Shipping S.A. 10
Slide 55: IMO (MEPC 76): CII and EEXI
IMO (MEPC 76): CII and EEXI. In June 2021, IMO's Marine Environment Protection Committee (MEPC 76) adopted amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI that will require ships to reduce their greenhouse gas emissions. These amendments combin
Slide 56: EU Emission Trading System (ETS) and Fuel EU
EU Emission Trading System (ETS) and Fuel EU. The European Commission has recently published a set of legislative proposals to enable the EU to attain its 2030 target of reducing its greenhouse gas emissions by at least 55% by 2030 compared with 1990 levels. In particular, the EU Commission proposed
Slide 57: Consolidated Income Statement
Financial results. Consolidated Income Statement 9 MONTHS 9 MONTHS Q3 2022 Q3 2021 US$ Thousand 2022 2021 136,494 59,298 Revenue 311,774 181,335 (42,321) (17,192) Voyage costs (101,994) (50,338) 94,173 42,106 Time charter equivalent earnings* 209,780 130,997 1,213 - Bareboat charter revenue * 3,599
Slide 58: Consolidated Balance Sheet
Financial results. Consolidated Balance Sheet As at As at US$ Thousand 30 September 2022 31 December 2021 ASSETS Property, plant and equipment and Right-of-use assets 797,583 821,434 Other non-current financial assets 11,887 9,849 Total non-current assets 809,470 831,283 Inventories 20,879 11,643 Re
Slide 59: Consolidated Cash Flow Statement
Financial results. Consolidated Cash Flow Statement 9 MONTHS 9 MONTHS Q3 2022 Q3 2021 US$ Thousand 2022 2021 43,558 (13,751) Profit (loss) for the period 62,776 (28,930) 14,837 16,428 Depreciation and amortisation 45,285 49,059 - 5,763 Impairment 2,080 5,763 159 (4) Current and deferred income tax 2
Slide 60: 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 61: 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 62: 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 63: Thank you!
Thank you!
d'Amico International Shipping — Q3 2022 Earnings Presentation on 6ix