Eimskipafelag Islands hf. · OMXICE:EIM
Eimskipafelag Islands hf — Q3 2016 Earnings Presentation
39 slides from Eimskipafelag Islands hf's earnings presentation, Nov 18, 2016
Slide 1: Strong performance continues in Q3
STRONG PERFORMANCE CONTINUES IN Q3 Q3 2016 - 18 November 2016 | Normalized EBITDA growth 23.3%
Slide 2: Highlights
HIGHLIGHTS 2
Slide 3: Key highlights for Q3 2016
KEY HIGHLIGHTS FOR Q3 2016 Q3 2016 compared to Q3 2015 EBITDA growth EBIT 8.6% up by 4.0% Net earnings Normalized EBITDA growth Normalized EBIT up by 10.7% 23.3% up by 27.9% Volume in Volume in liner services forwarding services Strong cash flow up by 6.8% up by 4.7% 3
Slide 4: Transported volume in Q3 2012 to 2016
TRANSPORTED VOLUME IN Q3 2012 TO 2016 Changes from Q3 in previous year Liner services Forwarding services Volume index: 2010 volume at 100 4
Slide 5: Revenue and EBITDA 2012 to 2016 by quarter
REVENUE AND EBITDA 2012 TO 2016 BY QUARTER Best third quarter since 2009 Revenue EBITDA EUR million EUR million Adjusted for one-off items in 2012 in connection with the IPO * EUR 2.0 million gain on disposal of a vessel under construction included in Q3 2015 revenue and EBITDA 5
Slide 6: China Forwarders Freight Index
CHINA FORWARDERS FREIGHT INDEX China - Europe 6
Slide 7: Key highlights for 9M 2016
KEY HIGHLIGHTS FOR 9M 2016 9M 2016 compared to 9M 2015 EBITDA growth EBIT 22.9% up by 30.6% Net earnings Normalized EBITDA growth Normalized EBIT up by 28.8% 30.1% up by 46.4% Volume in Volume in liner services forwarding services Strong cash flow up by 8.0% up by 3.0% 7
Slide 8: Transported volume 2012 to 9M 2016
TRANSPORTED VOLUME 2012 TO 9M 2016 Changes from previous year Liner services Forwarding services Volume index: 2010 volume at 100 8
Slide 9: Liner services volume
LINER SERVICES VOLUME Iceland, Faroe Islands, Norway and Trans-Atlantic 9
Slide 10: Forwarding services volume
FORWARDING SERVICES VOLUME Reefer and dry cargo forwarding 10
Slide 11: Financial results
FINANCIAL RESULTS 11
Slide 12: Income statement 9M 2016
INCOME STATEMENT 9M 2016 Key highlights EBITDA Revenue Operating expenses EUR 43.6 m EUR 373.4 m down by 1.1% up by 22.9% affected by freight despite salary expenses forwarding rates up by 22.1% EBITDA ratio 11.7% Currency exchange gain EBIT EUR 0.8 m Net earnings EUR 23.5 m compared to EUR 20.0 m u
Slide 13: Business segment bridges 9M 2016
BUSINESS SEGMENT BRIDGES 9M 2016 Revenue and EBITDA Revenue EBITDA EUR million EUR million 13
Slide 14: Salary bridge 9M 2016
SALARY BRIDGE 9M 2016 Salaries and related expenses 14
Slide 15: EBT bridge 9M 2016
EBT BRIDGE 9M 2016 Earnings before tax 15
Slide 16: Geographical split of revenue
GEOGRAPHICAL SPLIT OF REVENUE About half of revenue is related to Iceland 16
Slide 17: Revenue by business segment
REVENUE BY BUSINESS SEGMENT Liner services and forwarding services 17
Slide 18: EBITDA by business segment
EBITDA BY BUSINESS SEGMENT Liner services and forwarding services 18
Slide 19: Financial ratios 2012 to 2016
FINANCIAL RATIOS 2012 TO 2016 Low leverage and strong financial position Net debt / LTM-EBITDA Net debt and equity ratio EUR million EUR million Adjusted for one-off items in 2012 19
Slide 20: Cash flow bridge 9M 2016
CASH FLOW BRIDGE 9M 2016 Increased cash flow from operating activities 20
Slide 21: Capex 2012 to 2016
CAPEX 2012 TO 2016 EUR 26.1 million in 9M 2016 compared to EUR 36.3 million in 9M 2015 21
Slide 22: Ongoing projects and future development
ONGOING PROJECTS AND FUTURE DEVELOPMENT 22
Slide 23: Bremerhaven
BREMERHAVEN New port of call in Germany Eimskip will start calling Bremerhaven in Germany as of 6 December on the Blue Line EUROGATE Container Terminal Bremerhaven The company will stop calling Hamburg after 90 years of cooperation The terminal that Eimskip has been using will be closed due
Slide 24: Investments
INVESTMENTS Acquisitions and Joint Ventures Eimskip’s intent is to grow both organically and through strategic accretive acquisitions to increase shareholder value The company has made a significant progress Acquisition of 90% share in Extraco in October Acquisition of Nor Lines in November
Slide 25: Extraco
EXTRACO Strengthens Eimskip’s position in worldwide reefer logistics A specialized forwarding company in Rotterdam, established in 1991 Acquisition of a 90% share in the company Customers are importers of chilled and frozen commodities in the Netherlands Strong financial performance Annual
Slide 26: Nor Lines
NOR LINES Extensive logistics network in Norway Nor Lines currently operates an extensive logistics network Two liner routes Continent Line and Poland Line Seven vessels in operation Three reefer vessels Two multi-purpose vessels Two bulk vessels (not a part of the transaction) Netwo
Slide 27: Nor Lines
NOR LINES Strategic move to strengthen the Norwegian operation Eimskip signed an agreement to acquire the Norwegian shipping and logistics company Nor Lines in November 2016 It is a strategic fit to Eimskip’s current operation The estimated purchase price for the operation is EUR 15 million
Slide 28: Sea transport lines
28 SEA TRANSPORT LINES EIMSKIP - ORANGE LINE NOR LINES ~ CONTINENT LINE NOR LINES - POLAND LINE NOR LINES - HURTIGRUTEN Norway Sortland Nonway YY Hammerfest Batsfjord Norway Kirkenes
Slide 29: The vessel fleet in Norway
THE VESSEL FLEET IN NORWAY EIMSKIP - ORANGE LINE HOLMFOSS G Bult 2007 Reefer (Bulk TEU 24) ross Tonnage 3,538 PoLFoss @ Built 2008 Reefer (Bulk/ TEU 24) Gross Tonnage 3538, SVARTFOSS [ uit 2005, Reefer (Bulk/TEU 48) Gross Tonnage 2,990 vioross 1 But 1990 Reeter (Bulk) Gross Tonnage 3.525 EIMSKIP - R
Slide 30: Land transport lines
30 LAND TRANSPORT LINES — day ——e> 2-3 TIMES A WEEK - > WEEKLY ——> «spot RouTEs Hammerfest
Slide 31: Terminals and warehouses
31 EEIMsKIp TERMINALS AND WAREHOUSES (eo) ° NOR LINES EIMSKIP NORWAY DOMESTIC AGENTS INTERNATIONAL AGENTS Trondheim Norway Orkanger Norway Alesund Norway Bergen Norway \ $ Stavanger (Sandne: le Kristiansand Noway Hirtshall Denmark Grena Hammerfest
Slide 32: Eimskip and Nor Lines logistic network
32 EIMSKIP AND NOR LINES LOGISTIC NETWORK SEA TRANSPORT LINES LAND TRANSPORT LINES AND DISTRIBUTION TERMINALS AND WAREHOUSES, © nrerwarionaL TERMINAL AGENTS
Slide 33: Nor Lines: the restructuring project
NOR LINES The restructuring project The operation of Nor Lines has been challenging in recent years Why Nor Lines? Eimskip sees Nor Lines as a strategic fit with restructuring opportunities As a part of the transaction, Eimskip has already secured favorable agreements on the operation of Nor
Slide 34: Nor Lines: the restructuring project
NOR LINES The restructuring project Next steps Eimskip can not start working on implementing the restructuring process until after a formal approval from the Norwegian Competition Authority in Q1 2017 The restructuring task is in two phases Achieved in 2017 in relation to the transaction con
Slide 35: Royal Arctic Line: potential joint venture
ROYAL ARCTIC LINE Potential Joint Venture In May, Eimskip and Royal Arctic Line, the national carrier of Greenland, The companies have been formalizing and evaluating the potential signed a letter of intent to evaluate a potential cooperation regarding cooperation Container vessel investment
Slide 36: Changed EBITDA forecast for 2016
CHANGED EBITDA FORECAST FOR 2016 EBITDA in the range of EUR 52 to 55 million The outlook for the fourth quarter is in line with expectations Continued volume growth is expected in the Icelandic market Volumes in the Faroe Islands market are expected to grow Outlook for the reefer market in N
Slide 37: Questions
QUESTIONS 37
Slide 38: Disclaimer
DISCLAIMER Information contained in this presentation is based on sources that Eimskipafélag Íslands hf. (“Eimskip“ or the ”Company“) considers reliable at each time. Its accuracy or completeness can however not be guaranteed. Copyright of information contained in this presentation is owned by Eimsk
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