Slide 1: Presentation of 2020 Results
PRESENTATION OF 2020 RESULTS Vilhelm Már Thorsteinsson, CEO
Slide 2: This is Eimskip
•THIS IS EIMSKIP Eimskip is a leading transportation company in the North Atlantic providing container and reefer liner services with connections to international markets and is specialized in worldwide freight forwarding services with focus on frozen and chilled commodities ABOUT SUSTAINABILITY KPI
Slide 3: Q1 2020 Not the Start We Expected
Q1 2020 NOT THE START WE EXPECTED • Generally slower business than expected and harsh weather conditions in the North-Atlantic region • First signs of COVID-19 affecting the operation • Streamlining measures initiated in Iceland • Structural changes in Domestic operations to lower cost • Sales divis
Slide 4: Q2 2020 Uncertainty Surrounding COVID-19
Q2 2020 UNCERTAINTY SURROUNDING COVID-19 • COVID-19 changed the world over night • Crisis Management Team activated • Health and safety of employees and sustainability of the operation secured successfully • Flow of information substantially increased, both internally and externally • Container Line
Slide 5: Q3 2020 Adjusting for New Normal
Q3 2020 ADJUSTING FOR NEW NORMAL • Relatively strong results especially giving the challenging environment • Starting to benefit from streamlining measures initiated in 2019 and first half of 2020 • Cruise agency and ferry operation significantly affected by COVID-19 • First signs of “disruption” in
Slide 6: Q4 2020 Better End Than We Expected
Q4 2020 BETTER END THAN WE EXPECTED • Extreme focus on securing the sustainability of streamlining measures • Taking delivery of new Brúarfoss and the co-operation with Royal Arctic Line starting to yield benefits • Monitoring and preparing for Brexit • Impacts of COVID-19 negatively affecting e.g.
Slide 7: Current Trends in Global Container Shipping Markets
CURRENT TRENDS IN GLOBAL CONTAINER SHIPPING MARKETS COVID-19 leading to imbalance in supply and demand • Due to COVID-19, the large deep-sea lines reduced capacity and increased blank sailings • Imbalance increased which resulted in lack of containers in the deep-sea trade • Time to get containers t
Slide 8: Responding to Global Trends
RESPONDING TO GLOBAL TRENDS Adapting to dynamic markets and customers requirements INCREASED OCEAN FREIGHT RATES IMPROVED TRANS- IMPROVED EXPORT SERVICES ATLANTIC SERVICES General ocean freight rates increase More volume of fresh commodities Adjusting for Brexit and securing already announced to cus
Slide 9: Sustainability
SUSTAINABILITY _
Slide 10: Sustainability at the Forefront
SUSTAINABILITY AT THE FOREFRONT I N F O R M AT I O N S H A R I N G E X T E N S I V E W O R K O N E S G R E L AT E D P O L I C I E S • Information sharing to all stakeholders Policies Reviewed New Policies increased • Human Resource Policy • Whistleblower Policy • Quarterly publication of environment
Slide 11: ESG KPI's – YoY Development
ESG KPI‘S – YoY DEVELOPMENT Continued progress towards less environmental impact TOTAL WASTE GENERATED TOTAL SORTED WASTE TOTAL AMOUNT OF PRINTED PAPER 1,200,000 80 2,500,000 -1,61% 70 1,000,000 0,5% 60 2,000,000 800,000 50 Pages 1,500,000 Kg 40 % 600,000 30 1,000,000 -34,8% 400,000 20 500,000 200,0
Slide 12: Financial Results
FINANCIAL RESULTS
Slide 13: Income Statement 2020
INCOME STATEMENT 2020 Profitability improves with realization of streamlining measures 2020 • Revenue decreased by 1.7% which is less than expected EUR thousand 2020 2019 Change % given the pandemic • Volume and forwarding rates positively affecting revenue Revenue 668,316 679,594 (11,278) (1.7%) •
Slide 14: Development in Liner Services
DEVELOPMENT IN LINER SERVICES Same volume YoY after a strong last quarter PERFORMANCE IN 2020 EUR thousand Q4 2020 Q4 2019 Change % 2020 2019 Change % • Revenue decreased by 6.9% over the year due to e.g. lower BAF, weaker ISK and USD and cargo mix Revenue 104,933 109,190 (4,257) (3.9%) 402,841 432,
Slide 15: Development in Forwarding Services
DEVELOPMENT IN FORWARDING SERVICES Solid performance in a volatile environment PERFORMANCE IN 2020 EUR thousand Q4 2020 Q4 2019 Change % 2020 2019 Change % • Strong performance in freight forwarding given the COVID-19 situation which affected global markets in many ways Revenue 70,720 66,349 4,371 6
Slide 16: Expense Bridge
EXPENSE BRIDGE Streamlining measures positively affecting salaries and admin expenses EXPENSE BRIDGE 2020 2020 • Price increases in international forwarding markets affecting 3rd party expenses • Capacity reduction and price increases by the big carriers (Deep sea lines) • Offset by higher revenues
Slide 17: EBITDA Bridge 2020
EBITDA BRIDGE 2020 Benefitting from extensive streamlining measures in a challenging COVID-19 year EBITDA BRIDGE BY BUSINESS ACTIVITY EBITDA BRIDGE BY OPERATING ITEMS 17
Slide 18: EBIT Bridge 2020
EBIT BRIDGE 2020 Improved EBIT YoY EBIT BRIDGE BY BUSINESS ACTIVITY 18
Slide 19: Balance Sheet
BALANCE SHEET New container vessels increasing fixed assets while Tromsøterminalen increases lease liabilities ASSETS EQUITY AND LIABILITIES EUR thousand 31.12.2020 31.12.2019 Change % EUR thousand 31.12.2020 31.12.2019 Change % Non-current assets 400,433 355,712 44,721 12.6% Equity 230,657 230,868
Slide 20: Development of Loans and Borrowings
DEVELOPMENT OF LOANS AND BORROWINGS Strong cash flow used for down payments on revolver facilities LOANS AND BORROWINGS 2020 • New borrowings mainly related to the financing of new vessels Dettifoss and Brúarfoss or EUR 46m • Thereof EUR 14.6m used for refinancing previous borrowings towards the sam
Slide 21: Net Debt and Leverage Ratios
NET DEBT AND LEVERAGE RATIOS New operational leases increasing total debt 2020 EUR million • Leverage ratio above long-term target of 2-3x EBITDA • Return on recent investments not yet fully reflected in EBITDA • Last year results affected by COVID-19 • Equity ratio at 43.0% and above long-term targ
Slide 22: Cash Flow
CASH FLOW Proceeds from funding and cash flow from operation used for installments on revolver facilities 2020 2021 range • Considerable increase in cash flow before debt/lease Million EUR Q4 2020 Q4 2019 Change 2020 2019 Change Low High service EBITDA 14.9 11.2 3.7 61.7 60.5 1.1 68.0 77.0 • Mainten
Slide 23: Development in CAPEX
DEVELOPMENT IN CAPEX Investments in 2020 primarily related to vessel investments 2020 • CAPEX for the year very close to budget • Maintenance CAPEX EUR 12.9m and lower than budget and last year • Close to third of budgeted maintenance CAPEX was put on hold in Q2 due to COVID-19 Investments - Other •
Slide 24: Outlook
OUTLOOK
Slide 25: Dividend and Share Capital Reduction Proposals to the AGM
DIVIDEND AND SHARE CAPITAL REDUCTION PROPOSALS TO THE AGM Headroom within target capital structure for distribution to shareholders DIVIDEND PROPOSAL 2020 SHARE CAPITAL REDUCTION PROPOSAL • The Board of Directors will propose to the AGM • Reduce share capital equaling distribution to shareholders am
Slide 26: Management Assessment of Performance and Outlook
MANAGEMENT ASSESSMENT OF PERFORMANCE AND OUTLOOK 2020 OUTLOOK • Acceptable results in a demanding environment • EBITDA guidance for the year 2021 in the range of EUR 68 to 77 million • Extensive streamlining measures and structural changes resulting in • Translates to EBIT of EUR 22 to 31 million lo
Slide 27: Thank You
THANK YOU 27
Slide 28: Appendix I
APPENDIX I 28
Slide 29: Operating Results by Quarter
OPERATING RESULTS BY QUARTER EUR thousand OPERATING RESULTS Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 Revenue 175,653 170,378 160,615 161,670 175,549 Expenses 160,724 148,968 144,614 152,332 164,363 EBITDA 14,929 21,410 16,001 9,338 11,186 EBIT 3,201 10,446 5,035 (1,594) (3,319) Net earnings (loss) ea
Slide 30: Lease Liabilities (IFRS 16)
LEASE LIABILITIES (IFRS 16) Change in lease liabilities mainly due to new logistics center Tromsøterminalen in Norway IFRS 16 LEASE LIABILITIES BRIDGE ANALYSIS 31.12.2020 • Leases of buildings account for majority of lease Lease liabilities liabilities • Mostly long-term contracts • Tromsøterminalen
Slide 31: Shareholders Information
SHAREHOLDERS INFORMATION PAYMENTS TO SHAREHOLDERS SHAREHOLDERS 24.02.2021 EUR ‘000 Shareholder Country Shares % Samherji Holding ehf.* Iceland 56,650,175 30.29% Lífeyrissjóður verslunarmanna Iceland 27,235,070 14.56% Gildi - lífeyrissjóður Iceland 26,393,639 14.11% Arion banki hf. Iceland 14,759,725
Slide 32: Disclaimer
_—_— DISCLAIMER Information contained in this presentation is based on sources that Eimskipafélag [slands 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
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