Genco Shipping & Trading Limited · NYSE:GNK
Genco Shipping & Trading — Goldman Sachs Global Industrials Conference 2008
28 slides from Genco Shipping & Trading's conference presentation, Nov 6, 2008
Slide 1: Genco Shipping & Trading Limited – Goldman Sachs Global Industrial Conference 2008
Genco Shipping & Trading Limited Goldman Sachs Global Industrial Conference 2008 November 6, 2008
Slide 2: Forward Looking Statements
Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements ar
Slide 3: Genco Overview
Genco Overview Founded in December 2004, completed IPO in July 2005 High quality, modern fleet of 31 vessels ― Average age of 6.5 years compared to the average age of the world fleet of approximately 15 years ― Expected delivery of 4 additional vessels through the fourth quarter of 2009 Dividend sup
Slide 4: Management
Management Peter Georgiopoulos Gerry Buchanan John C. Wobensmith Chairman President Chief Financial Officer Over 20 years of Over 40 years of 15 years of experience in experience in the shipping experience in the shipping the shipping industry industry industry Formerly Senior Vice Chairman and foun
Slide 5: High Quality Operations
High Quality Operations Extensive relationships with Selected Customer Relationships established drybulk charterers These relationships help us to: ― Stabilize revenue through favorable contract terms ― Minimize counterparty risk ― Maximize fleet utilization We utilize three leading technical Techni
Slide 6: Current Fleet
Current Fleet * Cash Daily Net Revenue Vessel Type Vessel Name Year Built Charterer Charter Expiration (3) Rate (1) Daily Rate (2) Genco Augustus 2007 Cargill International S.A. 45,263 62,750 December, 2009 Capesize Genco Tiberius 2007 Cargill International S.A. 45,263 62,750 January, 2010 Genco Lon
Slide 7: Footnotes to Fleet Table (previous page)
Footnotes to Fleet Table (previous page) (1) Time charter rates presented are the gross daily charterhire rates before the payments of brokerage commissions ranging from 1.25% to 6.25% to third parties, except as indicated for the Genco Leader in note 6 below. In a time charter, the charterer is res
Slide 8: Acquisition Vessels to Be Delivered
Acquisition Vessels to be Delivered Cash Vessel Year Duration/ Vessel Name DWT Yard Delivery(1) Charterer Daily Type Built(1) Expiration Rate Capesize Cargill International 46 to 62 months 65,000(3) Genco Hadrian(2) 170,500 Sungdong Q1 2009 2009 S.A. (2) from delivery 4 Genco Commodus 170,500 Sungdo
Slide 9: Financial Overview
Financial Overview
Slide 10: Balance Sheet – Selected Financial Information Updated Pro Forma 09/30/08
Balance Sheet Selected Financial Information Updated Pro Forma 09/30/08 (Dollars in thousands) Balance Sheet Liquidity Position Cash(1) $68,234 Revolving Credit Facility $1,377,000 Debt(2) $1,076,500 Drawn Portion (1,076,500) Shareholders’ Equity(3) $727,369 Undrawn Portion $300,500 Capitalization $
Slide 11: Q4 2008 Estimated Break-Even Levels
Q4 2008 Estimated Break-Even Levels(1) Daily Expenses by Category Free Cash Flow(2) Net Income Direct Vessel Operating(3) 4,700 4,700 General & Administrative(4) 987 1,456 Management Fees(5) 259 259 Dry Docking (6) 982 - Interest Expense (7) 5,210 5,563 Depreciation(8) - 7,013 Daily Break-Even(9) 12
Slide 12: Capital Structure Update
Capital Structure Update Revolving Facility Amount Up to $1.4 billion Term 10 Years Swapped a total amount of $681.2 Amortization 5 Years non- million at an average rate of (Semiannual) amortizing approximately 4.8% for 2008 10 x $96.4 million The Company is discussing with its lenders the potential
Slide 13: Dividend Declaration & Policy
Dividend Declaration & Policy Disciplined Asset Growth Declared a Q3 2008 dividend of and T/C Strategy $1.00 per share payable on or Period Declared Dividend about November 28, 2008 to all Q3 2005 $0.60 shareholders of record as of Q4 2005 $0.60 November 17, 2008 Q1 2006 $0.60 Cash reserves are dete
Slide 14: Growth Strategy: Timing Is Everything
Growth Strategy: Timing Is Everything Opportunistic and prudent acquisition strategy ― Accretive earnings and cash flows while maintaining a disciplined approach to return on capital Pursue Accretive Revolver is primary driver of growth strategy Acquisitions ― Accretive to shareholders and reduces d
Slide 15: Significant Opportunities in Fragmented Industry
Significant Opportunities in Fragmented Industry No single owner owns more than 7% of the vessels within each class Market capitalization for all U.S.-listed pure drybulk owners is approximately $5 billion (1) Drybulk industry has similarities to the tanker industry in 1999 Ownership 100.0% 80.0% %
Slide 16: Industry Overview
Industry Overview
Slide 17: Global Seaborne Trade – 2007E
Global Seaborne Trade – 2007E Total Seaborne Trade Drybulk Seaborne Trade General Bulk Steam Coal Drybulk 9% 19% Container 16% Coking 38% 38% 7% Coal 37% 10% 26% Liquid Iron Ore (Oil / Gases / Grain Chemical) 8.0 billion tons 3.0 billion tons Source: Clarkson’s Research Services; 2007 Estimated 17
Slide 18: Major Drybulk Trade Routes
Major Drybulk Trade Routes Iron Ore Coal Source: Drewry Grains 18
Slide 19: Drybulk Indices
W W ee k 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 ee W 1 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 k W 1 ee k ee W 3 k W 3 ee k ee W 5 k W 5 ee k ee W 7 k ee W 7 W k9 ee Source: Clarkson’s ee W k9 k (BDI Points) ee W 11 k (BPI Points) ee W 11 ee W k 13 k ee W 13 ee k W 15 k ee W 15 ee k W
Slide 20: Reasons Behind Current Market Weakness
Reasons Behind Current Market Weakness Several steel mills were shutdown during the Olympics due to: ― Government efforts to curb pollution and force industry wide consolidation ― Increasing prices of raw materials (coke and ore) Construction and manufacturing slowdown due to Olympics ― Continued th
Slide 21: China's Development – Macro Picture
China’s Development – Macro Picture Chinese economic growth is mostly domestically driven by urbanization and industrialization Chinese industrial production grows 11.4% through September 2008(1) Chinese fixed asset investment rise of 27.0% through September 2008(1) $555 billion investment on transp
Slide 22: Demand Side Fundamentals
Demand Side Fundamentals YOY growth for Chinese steel production at 7.8% and iron ore imports at 22% through September 2008 Vale withdraws from a previously requested 10-12% incremental increase ore prices Slowdown in Indian iron ore exports due to higher taxes and monsoon season North American grai
Slide 23: Supply Side Fundamentals
Supply Side Fundamentals 23% of Capesize orders for 2009 delivery and 33% of orders for 2010 being constructed at Greenfield yards(1) Credit crunch poses threat to new as well as existing yards Newbuilding delivery delays starting to occur due to engine, crane and other part shortages Over 30% of th
Slide 24: Appendix
Appendix
Slide 25: Pro Forma Reconciliation 09/30/08
Pro Forma Reconciliation 09/30/08 (Dollars in thousands) 09/30/08 Actual Adjustment 09/30/08 Pro Forma Cash(1) $142,455 ($74,221) $68,234 Debt(2) $1,129,500 (53,000) $1,076,500 Shareholders’ Equity(3) $815,187 ($87,818) $727,369 Capitalization $1,944,687 - $1,803,869 (1) September 30, 2008 pro forma
Slide 26: Year to Date Earnings
Year to Date Earnings Three Months Ended Nine Months Ended September 30, 2008 September 30, 2007 September 30, 2008 September 30, 2007 (Dollars in thousands, except share and per share data) (Dollars in thousands, except share and per share data) (unaudited) (unaudited) INCOME STATEMENT DATA: Revenu
Slide 27: September 30, 2008 Balance Sheet
September 30, 2008 Balance Sheet September 30, 2008 December 31, 2007 (Dollars in thousands) (unaudited) BALANCE SHEET DATA: Cash $ 142,455 $ 71,496 Current assets, including cash 220,815 267,594 Total assets 2,030,947 1,653,272 Current liabilities, including current portion of long-term debt 31,133
Slide 28: 3rd Quarter Highlights
3rd Quarter Highlights Three Months Ended Nine Months Ended September 30, 2008 September 30, 2007 September 30, 2008 September 30, 2007 (unaudited) (unaudited) FLEET DATA: Total number of vessels at end of period 31 22 31 22 Average number of vessels (1) 29.9 19.9 28.7 19.5 Total ownership days for
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