Pacific Basin Shipping Limited · HKEX:2343
Pacific Basin Shipping — Q1 2010 Earnings Presentation
37 slides from Pacific Basin Shipping's earnings presentation, Apr 21, 2010
Slide 1: Q1 Trading Update
Pacific Basin 21 April 2010 Q1 Trading Update
Slide 2: Pacific Basin Overview
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Pacific Basin Overview One of the world’s leading dry bulk owners/operators of modern handysize and handymax vessels Pacific Basin dry bulk business model highly flexible Large fleet of uniform, interchangeable modern vessels M
Slide 3: 2010 First Quarter Highlights
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin 2010 First Quarter Highlights Good start to 2010, with continued demand of the smaller bulk carriers’ market — in line with our expectations Handysize and handymax freight rates increasing 20% and 17% respectively year to date on c
Slide 4: Pacific Basin Dry Bulk
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Pacific Basin Dry Bulk Dry bulk net profit in 2009: US$138m Pacific Basin Dry Bulk Fleet: 119 (as at 21 April 2010) Handysize: US$124m Average age <7 years Handymax: US$14m Owned + Committed Fleet employed worldwide carrying a
Slide 5: Dry Bulk Market Information
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin As at 20 April 2010 Dry Bulk Market Information Baltic Dry Index BCI, BSI & BHSI 5,000 US$/day (net) 42,000 4,000 36,000 3,000 Supramax (BSI): 30,000 US$25,905 2,000 Capesize (BCI): 20 April 2010 24,000 US$25,185 US$25 185 1,000 2 998
Slide 6: Chinese Commodity Demand
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Chinese Commodity Demand China Iron Ore Sourcing for Steel Production China is a Net Importer of Coal Million Tonnes 1,055 1,100 Million Tonnes 250 900 906 193 782 799 708 200 700 674 628 127 150 613 500 100 446 347 51 278 38 41 22 19
Slide 7: Dry Bulk Demand
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Dry Bulk Demand Dry Bulk Fleet Demand and Supply 2003 - 2009 % Change % change YOY YOY 14 6 14.6 15 10.7 13.0 9.4 5.6 12 9.9 9 68 6.8 70 7.0 65 6.5 6 -0.3 6.1 6.5 3 4.3 0.02 3.8 -5.9 -8.3 0 -10 5 -10.5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -3 2008 2
Slide 8: Dry Bulk Orderbook
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Dry Bulk Orderbook Orderbook as % Average of Existing Fleet Age Mil Dwt Orderbook by Year Total Dry Bulk >10,000 Dwt 61% 120 23% 22% 100 Capesize 83% 11 80 Panamax 54% 12 12% 60 Handymax (35,000-59,999 (35,000 59,999 Dwt) 49% 15 40 3%
Slide 9: Dry Bulk Fleet Changes
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Dry Bulk Fleet Changes Dry Bulk Fleet Delivery & Scheduled Orderbook Global Dry Bulk Fleet Development Mil Dwt Mil Dwt 140 20 12.4% 126.0 9.9% 7.5% 7 5% 06 0.6 120 Brokers’ 15 1.9 1.4 6.5% non-delivery 6.3% 100 predictions 10 2.2 3.4 1
Slide 10: Handysize Vessel Values
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Handysize Vessel Values 5 Year Old 28,000 Dwt Values Sales and purchase activity US$ million return after stagnation 55 for most of 2009 50 45 Since Jan 2010, 40 the price of a benchmark 35 five year old handysize 30 vessel increased s
Slide 11: Dry Bulk Outlook
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Dry Bulk Outlook Global Gl b l economic i recovery Unwinding Chinese economic stimulus Strong cargo demand from China Enormous orderbook for 2010 Port congestion & others botternecks Increasing commodity prices favour Sli
Slide 12: PB Dry Bulk Earnings Coverage
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin PB Dry Bulk Earnings Coverage Handysize Handymax as at 20 April 2010 Revenue Days 2010 total combined cover of 33,090 days*: 78% 28,000 26,100 days Unfixed 23,650 days 24,000 Fixed 20,000 16 000 16,000 12,000 10,640 days^ 8,000 6,740 d
Slide 13: PB Energy & Infrastructure Services
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin PB Energy & Infrastructure Services FBSL PB Towage Towage Fleet: 40 vessels PB Sea-Tow PB Towage Australia PB Towage Middle East (as at 21 April 2010) (Offshore Projects) (Harbour Towage) (Offshore Projects) 2 Chartered tugs 3 Tugs new
Slide 14: Fujairah Bulk Shipping
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin PB Energy & Infrastructure – Fujairah Bulk Shipping FBSL contribution to PB results in 2009: US$6.3m (2008 US$0.3m) (2008: US$0 3m) Land reclamation for Municipality of Fujairah requiring approx. 54m tonnes of rock & aggregates of
Slide 15: Energy & Infrastructure – Outlook
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Energy & Infrastructure – Outlook Global economic recovery Container-related harbour towage g High entry barriers market still weak Increase in oil and energy prices Resumption of infrastructure and offshore ff h projects j t
Slide 16: PB RoRo
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin PB RoRo 2009 net profit US$0.1 m Group incurred G i d US$25m US$25 impairment i i t reflecting fl ti our concern about b t ability bilit to t deploy d l RoRo vessels profitably in 2010 and 2011 First vessel “Humber Viking” fixed to
Slide 17: RoRo Market
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin RoRo Market RoRo Vessels (1,300-2,700 Lane Metres) 1-Year Time Charter Rates RoRo Orderbook: 16% 1,300 lm-1,700 lm 45 Vessels (143,408 Lane Metres) E Euro/Day /D 1,800 lm-2,200 lm 30+ Years 0-14 Years 2,300 lm-2,700 lm LMs 18,000 32% 3
Slide 18: RoRo – Outlook
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin RoRo – Outlook Slow economic recovery in Europe Increased RoRo newbuilding deliveries Increasing environmental regulation, expected in 2010/ 2011 trend towards use of larger, more Limited employment potential fuel efficient RoR
Slide 19: 2009 Financial Highlights
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin 2009 Financial Highlights A att 31 Dec As D 2009 2009 2008 Segment g net profit p 141.9 311.5 Treasury (13.8) 21.0 Non direct G&A (12.3) (11.8) Underlying profit 115.8 320.7 Vessel impairment losses – RoRo / Dry bulk (25.0) (19.5) Unre
Slide 20: Daily Vessel Costs - Handysize
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Daily Vessel Costs - Handysize As at 31 Dec 2009 Owned Chartered US$/day Charter-hire days y & rates Blended US$9,690 US$9 690 (FY2008: US$14,960) US$14 960) 2010-2012 Opex 19,420 US$12,320 530 US$10,970 Depreciation Finance cost 8,480
Slide 21: Balance Sheet
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin As at 31 Dec 2009 Balance Sheet PB PB PB US$ US$m Dry Bulk EIS RoRo Treasury 31 Dec 09 31 Dec 08 Vessels & other fixed assets 611 160 211 - 998 861 Total assets 767 271 259 , 1,036 , 2,470 , 2,331 Long term borrowings 199 41 65 572 877
Slide 22: Borrowings and Capex
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Derived from 31 Dec 2009 Borrowings and Capex US$m Funded from: i) US$1,106m cash end 2009, 400 384.2 ii) US$230m cash from issue of new C C.B. B 350 Redeemable in iii) new borrowings, and Feb 2011 314.0 iv) future operating cashflows
Slide 23: Capex and Combined Value by Vessel Types
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Capex and Combined Value by Vessel Types Based on 2009 Annual Report Vessels Commitments at 31 Dec 2009 (including options) A Combined View of & recent purchases up to 28 Feb 2010 Vessel Carrying Values and Commitments US$m T t l US$45
Slide 24: Outlook
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Outlook Focus on three core businesses: PB Energy & Pacific Basin Dry Bulk PB RoRo I f Infrastructure t t S Services i Handysize and handymax sectors off to a good start in the 1Q10. We p expect dry y bulk to remain firm before wea
Slide 25: Disclaimer
Pacific Basin Disclaimer This presentation contains certain forward looking statements with respect to the financial condition, results of operations and business of Pacific Basin and certain plans and objectives of the management of Pacific Basin. Such forward looking statements involve known and u
Slide 26: Convertible Bonds Due 2016
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Convertible Bonds Due 2016 Issue size US$230 million Maturity Date 12 April 2016 (6 years) Investor Put Date and Price 12 April 2014 (4 years) at par Coupon 1.75% p.a. payable semi-annually in arrears on 12 April and 12 October Redempt
Slide 27: China at late-Industrialisation Stage
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: Chi att late-Industrialisation China l t I d t i li ti St Stage Steel Consumption Per Capita Tons per Capita China (from 1990) China growth matches Japan (from 1950) 1.0 Korea (from 1970) historical trend in India (from 2005)
Slide 28: Pacific Basin Dry Bulk - Diversified Cargo
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: Pacific Basin Dry Bulk - Diversified Cargo Pacific Basin Dry Bulk Cargo Volume 1Q10 (Handysize and Handymax) Alumina 6% (+2%) Coal / Coke 9% (+2%) Concentrates 10% (+4%) 7.3 Fertilisers 7% (-5%) Other Bulks* 6% (+0%) Million
Slide 29: Towage Financial Drivers
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: T Towage Financial Fi i l Drivers Di 2009 Towage net profit: US$1.0m Offshore Towage Harbour Towage Operation Providing project/module Operating harbour tugs in the ports transportation and offshore support of Melbourne, Br
Slide 30: Gorgon Project
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: PB Energy & Infrastructure – G Gorgon Project P j t Pacific Basin’s role: 1/3 partner in Offshore Marine Services Alliance (OMSA) Secured a A$350m marine logistics contract for the Gorgon Project Phase 1: 5 tugs on bare
Slide 31: Towage Market
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: PB Energy & Infrastructure – Towage Market Charter Rate Oil Price Oil price collapse in 2008 & 2009 US$ US$ resulted in weakened demand and 60 000 60,000 10,000 10 000 bhp+ 100 7,000-10,000 bhp 90 steep decline in offshore ch
Slide 32: PB RoRo Operations
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: PB RoRo Operations Loading and discharging cargoes over the stern ramp A wide range of goods on Our O first fi t RoRo R R vessell wheeled trailers. Examples: has been chartered to Norfolk Line Only the trailers • Chilled vege
Slide 33: PB Energy & Infrastructure Services, PB RoRo
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: PB Energy & Infrastructure Services PB RoRo As at 31 December 2009 2009 2008 PB Energy & Infrastructure Services Offshore and project supply and harbour towage services (“Towage”) 1.0 (16.0) Fujairah Bulk Shipping (“FBSL”) 63
Slide 34: Pacific Basin Dry Bulk – Handysize
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: Pacific Basin Dry Bulk – Handysize As at 31 Dec 2009 1H09 2H09 2009 2008 Change R Revenue d days (d (days)) 12,460 13,640 26,100 24,890 +5% TCE earnings (US$/day) 13,610 15,310 14,500 29,600 -51% Owned + chartered cost (US$/d
Slide 35: Pacific Basin Dry Bulk – Handymax
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: Pacifc Basin Dry Bulk – Handymax As at 31 December 2009 1H09 2H09 2009 2008 Change Revenue days (days) 5,150 5,490 10,640 11,050 -4% TCE earnings (US$/day) 19,840 19,160 19,490 44,610 -56% Owned + chartered cost (US$/day) 17,
Slide 36: Impact of Financial Instruments
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: Impact of Financial Instruments Year ended 31 December US$ m Realised Unrealised 2009 2008 Net Gains / (Losses) Forward freight agreements 28.3 (54.0) (25.7) 77.0 Bunker swap contracts (0.8) 46.5 45.7 (47.2) Interest rate swa
Slide 37: Cashflow
Dry Bulk · Energy & Infrastructure Services · RoRo Pacific Basin Appendix: As at 31 Dec 2009 Cashflow 2009 2008 US$m Operating cash inflows 145 459 Investing cash outflows (176) (244) - Vessels & other fixed assets related payments (297) (381) - Sales of vessels 105 314 - Jointly controlled entities
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