Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Q3 2023 Earnings Presentation
37 slides from Dampskibsselskabet Norden A/s's earnings presentation, Nov 2, 2023
Slide 1: Presentation of Third Quarter Results 2023
PRESENTATION OF THIRD QUARTER RESULTS 2023 Copenhagen, Denmark, 2 November 2023
Slide 2: Forward Looking Statements
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 2023 and subsequent years are subject to uncertainty, and NORDEN’s actual results may therefore differ
Slide 3: Key Statements and Highlights for Q3 2023
KEY STATEMENTS AND HIGHLIGHTS FOR Q3 2023 3 PRESENTATION OF Q3 RESULTS 2023
Slide 4: Key Statements for Q3 2023 in Line with Expectations
KEY STATEMENTS FOR Q3 2023 IN LINE WITH EXPECTATIONS GROUP PROFIT USD million 250 243 • High coverage in dry cargo and continued strong margins in tankers resulted in a strong financial result in the third quarter with a profit of USD 99 million and a 200 205 179 return on equity (ROE annualised) of
Slide 5: Highlights for Q3 2023 Group Financials
HIGHLIGHTS FOR Q3 2023 GROUP FINANCIALS • Continued strong financial performance in line with expectations and building to KEY FIGURES Q3 & 9M 2023 (USD) the Group’s track-record of positive profit since 2017. EBITDA EBIT • EBITDA of USD 177 million compared to USD 348m in Q3 2022 impacted by lower
Slide 6: Highlights for Q3 2023 Limited Market Exposure
HIGHLIGHTS FOR Q3 2023 LIMITED MARKET EXPOSURE Dry Cargo Position - Group (by end of Q3 2023) 60 50 40 18 14 12 11 10 6 3 • Limited market exposure for Q4 2023 and FY 2024 due to high 30 23 21 21 4 3 4 3 coverage in both dry cargo and tankers. 40 20 Vessels 60 34 36 35 36 35 36 35 34 30 29 29 31 31
Slide 7: Highlights for Q3 2023 Projects & Parcelling Update
HIGHLIGHTS FOR Q3 2023 PROJECTS & PARCELLING UPDATE • The start of the integration process of the acquired Projects & Parcelling activities have been successful with commercial and cost synergies being realised. • Projects & Parcelling has a global, large and diversified customer base within renewab
Slide 8: Highlights for Q3 2023 ESG Update
HIGHLIGHTS FOR Q3 2023 ESG UPDATE Our climate commitments • NORDEN continues to work on new initiatives to reach ESG targets and help customers decarbonise their supply chains. • In Q3 the emissions (EEOI) have been reduced by -5% Y/Y driven by higher fuel efficiency related to lower average speed a
Slide 9: Guidance and Final Remarks
GUIDANCE AND FINAL REMARKS 9 PRESENTATION OF Q3 RESULTS 2023
Slide 10: Guidance: Lifting the Low End of Guidance
GUIDANCE LIFTING THE LOW END OF GUIDANCE • Based on the year-to-date profit of USD 357 million and high coverage for the rest of the year, NORDEN narrows its guidance range to a full-year profit of USD 380-420 million (previously USD 360-420 million), including profit/loss from sale of vessels. • Fo
Slide 11: Final Remarks: High Near-Term Visibility
FINAL REMARKS HIGH NEAR-TERM VISIBILITY • Strong financial performance in line with expectations and high level of coverage gives near-term high earnings visibility. • Dry cargo market expected to perform in line with normal seasonality and affected by lower growth in demand. Tanker market to stay n
Slide 12: 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.norden.com Connect with us 12 PRESENTATION OF Q3 RESULTS 2023
Slide 13: Appendix
APPENDIX Consolidated financial information and fleet data for NORDEN Market development and outlook NORDEN at a glance Our strategy Business units Total shareholder returns and business unit valuation 13 PRESENTATION OF Q3 RESULTS 2023
Slide 14: NORDEN Financials
NORDEN FINANCIALS 14 PRESENTATION OF Q3 RESULTS 2023
Slide 15: Financial Highlights: Income Statement - NORDEN Group
FINANCIAL HIGHLIGHTS CONSOLIDATED FINANCIAL INFORMATION Income Statement - NORDEN Group 2021 2022 2023 USD million Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Revenue - services rendered, external 603.6 854.4 940.1 1,152.3 3,550.4 1,087.5 1,419.6 1,494.9 1,307.7 5,309.7 998.0 951.3 897.4 Revenue - servic
Slide 16: Income Statement – Freight Services & Trading
FINANCIAL HIGHLIGHTS CONSOLIDATED FINANCIAL INFORMATION Income Statement – Freight services & Trading 2022 2023 USD million Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Revenue - services rendered, external 1,049.3 1,359.5 1,439.3 1,246.1 5,094.2 934.8 875.4 818.7 Revenue - services rendered, internal 0.0 0.0 0.0 0.0 0.
Slide 17: Income Statement – Assets & Logistics
FINANCIAL HIGHLIGHTS CONSOLIDATED FINANCIAL INFORMATION Income Statement – Assets & Logistics 2022 2023 USD million Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Revenue - services rendered, external 38.2 60.1 55.6 61.6 215.5 63.2 75.9 78.7 Revenue - services rendered, internal 91.7 91.5 93.8 100.0 377.0 87.5 82.0 85.0 R
Slide 18: Assets & Logistics Fleet Overview
ASSETS & LOGISTICS FLEET OVERVIEW At 30 September 2023 Dry Cargo Vessels in operation Vessels to be delivered Capesize 4 0 Panamax 16 4 Supramax 20 8 Handysize 12 6 Total 52 18 - Of which own vessels Capesize 4 0 Panamax 3 0 Supramax 1 5 Handysize 0 0 Total 8 5 Tankers Vessels in operation Vessels t
Slide 19: Assets & Logistics Capacity and Coverage
ASSETS & LOGISTICS CAPACITY AND COVERAGE Assets & Logistics – Dry Cargo Assets & Logistics – Tankers At 30 September 2023 At 30 September 2023 2023 2024 2025 2023 2024 2025 2023 2024 2025 2023 2024 2025 Own vessels Vessel days Own vessels Vessel days Capesize 364 1,464 1,460 MR 1,009 4,026 4,015 Pan
Slide 20: Business Unit Performance
BUSINESS UNIT PERFORMANCE 20 PRESENTATION OF Q3 RESULTS 2023
Slide 21: Freight Services & Trading: Profitable Quarter in Challenging Market
FREIGHT SERVICES & TRADING PROFITABLE QUARTER IN CHALLENGING MARKET RESULT PER VESSEL DAY USD / day • Freight services & Trading reported continued profitability in Q3 with a profit of 3,500 3,297 USD 30 million compared to USD 190 million in Q3 22. 3,000 • Both market segments reported positive ear
Slide 22: Assets & Logistics: Focus on Protecting Values
ASSETS & LOGISTICS FOCUS ON PROTECTING VALUES NAV PER SHARE (END Q3) DKK Pay-out of DKK 115 per share in 500 dividends since August 2022 446 422 400 377 381 360 • Assets & Logistics reported another strong quarter with a profit of USD 69 347 million in Q3, including profit from sale of vessels of US
Slide 23: Asset & Logistics: Extensive Optionality in Uncertain Environment
ASSET & LOGISTICS EXTENSIVE OPTIONALITY IN UNCERTAIN ENVIRONMENT • NORDEN’s extensive optionality provides potential value upside in an environment with increasing interest rates, increased new building prices and near-term lower visibility on freight rates due to the macro-economic uncertainties. •
Slide 24: Market Development and Outlook
MARKET DEVELOPMENT AND OUTLOOK 24 PRESENTATION OF Q3 RESULTS 2023
Slide 25: Markets: Dry and Tanker Market in Q3
MARKETS DRY AND TANKER MARKET IN Q3 5-year secondhand asset values (dry cargo & product tanker) USD million 60 Weaker volume growth in Q3 in Dry cargo • Weaker global volume growth in Q3, while still longer distances led to positive 50 tonnage-miles growth Y/Y. 40 • Congestion levels back to pre-pan
Slide 26: Markets: Market Outlook in Dry Cargo
MARKETS MARKET OUTLOOK IN DRY CARGO Global volumes transported (30-day moving average) 13.5 Lower demand and congestion in focus • Global volumes in Q3 declined by around 0.5% Y/Y driven by continued weak 12.5 Million tonnes import to RoW of –7.5% Y/Y and growth of 7.7% Y/Y in import to China. • In
Slide 27: Markets: Market Outlook in Tanker
MARKETS MARKET OUTLOOK IN TANKER Clean products and crude oil in transit (number of barrels in transit compared to January 2020 in %) 130% 120% Positive tanker market continued – rates stabilising at high levels 110% • The product tanker market is expected to remain strong throughout 2023 and 100% i
Slide 28: EU Emissions Trading Scheme Regulating Maritime Transport
EU EMISSIONS TRADING SCHEME REGULATING MARITIME TRANSPORT • Will enter into force for marine transportation as per January 1st 2024 • Regulates emissions for vessels of 5,000 gross tonnage and above Adds regulation to voyages conducted on EU territory Companies must purchase allowances for: - 50% of
Slide 29: NORDEN at a Glance
NORDEN AT A GLANCE 29 PRESENTATION OF Q3 RESULTS 2023
Slide 30: NORDEN at a Glance
NORDEN AT A GLANCE 2005: NORDEN establishes Norient 2021: Product Pool with pool-partner Interorient Navigation NORDEN celebrates 150 years of sailing the seven seas 1923: Company Ltd., Cyprus NORDEN’s first motor vessel, NORDBO is delivered 2013: 2023: 1871: 1973: NORDEN finalises its first NORDEN
Slide 31: NORDEN at the Heart of Global Trade
NORDEN AT THE HEART OF GLOBAL TRADE Founded in 1871, NORDEN is one of the largest globally operating shipping companies and is listed on Nasdaq Copenhagen as part of the OMX Nordic Large Cap index. We provide dry cargo and product tanker services, operating from 14 offices across 6 continents. As an
Slide 32: NORDEN Strategy
NORDEN STRATEGY Macrotrends affecting shipping NORDEN strategy Geopolitical complexity Customer-focused freight services, logistics and climate solutions Market volatility Asset-light business model Digitalisation High-performing organisation Data, analytics and risk management Decarbonisation 32 PR
Slide 33: Business Units
BUSINESS UNITS ASSETS & LOGISTICS FREIGHT SERVICES AND TRADING Asset Management Logistics & Climate solutions Asset-Light Freight Services Dry cargo Product tanker Port logistics & Construction Foods & oils Energy Industrial vessels vessels decarbonisation • Asset trading of owned vessels • Integrat
Slide 34: Shareholder Returns and Valuation
SHAREHOLDER RETURNS AND VALUATION 34 PRESENTATION OF Q3 RESULTS 2023
Slide 35: Highlights for Q3 2023: Shareholder Cash Distribution
HIGHLIGHTS FOR Q3 2023 SHAREHOLDER CASH DISTRIBUTION CASH DISTRIBUTED TO SHAREHOLDERS (USD million) 800 by end of September 2023 • NORDEN for Q3 announces an interim dividend of USD 46 million (DKK 10 per share) or 47% of the Group profit for the quarter. NORDEN share will trade ex-dividend on 3 Nov
Slide 36: Share Price: Total Shareholder Returns
SHARE PRICE TOTAL SHAREHOLDER RETURNS ~ USD 1.1 billion returned since 2020 (When including interim dividends and share buyback programme) 900 Total shareholder return since 2019 800 (As of 30 September2023) 700 627 600 500 413 400 300 300 200 100 0 Jan/19 Jun/19 Nov/19 Apr/20 Sep/20 Feb/21 Jul/21 D
Slide 37: Share Price Valuation
SHARE PRICE VALUATION ASSETS & LOGISTICS FREIGHT SERVICES & TRADING NAV-based valuation Earnings-multiple based valuation Per 30/9/2023 USDm Market value of own vessels 924 TOTAL VALUE Market value of T/C & Cover portfolio 337 Avg. historical margin per day since 2019 757 OF NORDEN (excl. full-year
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