Irish Continental Group Plc · EURONEXT:IR5B

Irish Continental — FY2005 Earnings Presentation

69 slides from Irish Continental's earnings presentation, March 2006

  1. Slide 1: ICG Profile

    ICG Profile Capital Employed 2005 1. Irish Ferries Biggest ferry company operating between UK / Continent and Republic of Ireland. ƒ Modern fleet of large ships ƒ Key slots - barriers to entry 63% ƒ Significant operational gearing ƒ Significant restructuring of crew costs complete ƒ Strong free cash

  2. Slide 2: ICG - Financial Performance

    ICG - Financial Performance 2005 2004 €m €m Turnover 298.7 293.3 EBITDA* 46.7 49.4 EBIT* 19.0 23.3 PBT* 14.3 17.9 Exceptional Restructuring Charges 29.1 12.4 Adjusted EPS (cent)** 57.9 76.2 Dividend (Redemption) per Share (cent) 29.1 25.9 Net Debt 105.9 117.9 Net Equity 138.6 150.5 * Pre exceptional

  3. Slide 3: Container Division

    Container Division 2005 2004 €m €m Turnover 136.4 129.8 +5.1% EBITDA 7.9 5.5* +43.6% Depreciation/ Amortisation (3.7) (3.0) +23.3% Operating Profit 4.2 2.5 +68.0% ƒ Before exceptional item of €1.5m

  4. Slide 4: Operations

    Operations ƒ Container Routes ƒ Ireland / Continent Door to Door plus Quay to Quay ƒ UK / Continent Quay to Quay container movement ƒ Port Ownership ƒ Container Terminal in Dublin (“DFT”)

  5. Slide 5: Container Routes

    Container Routes Grangemouth 14 ships Belfast South Shields Warrenpoint 13 ports Dublin Dublin Liverpool 19 routes Waterford Cork Holyhead Cork Holyhead Immingham Pembroke Pembroke Felixstowe Southampton Rotterdam Rotterdam Antwerp Le Havre (Radicatel)

  6. Slide 6: Market Share – LoLo 2005 (est.)

    Market Share – LoLo 2005 (est.) All Ireland (UK & Continent) % Peel Holdings 33 ICG 24 Samskip 16 Norfolk Line (Maersk) 9 C2C 8 Others 10 Total 100

  7. Slide 7: Container Terminal Market

    Container Terminal Market 1.3 Million Teu in 2005 ƒ 150 year lease of 33 acres from 1971 ƒ Capacity of terminal increased by 50% (July 2004) ƒ Direct access to new Port Tunnel (2nd half 2006) ƒ 480 metres of berths 9 – 11 metres depth. Picture courtesy of The Irish Times

  8. Slide 8: Container Handling in Ireland Market Share 22%

    Container Handling in Ireland Market Share 22% 2005 % CAGR Volume % 14 13% 12 10 8 7% 7% 7% 6% Market 6% 6% 6 ICG 4% 4 2 0 Last Last Last 2005 10 Yrs 5 Yrs 3 Yrs

  9. Slide 9: Ferries Division

    Ferries Division 2005 2004 €m €m Turnover 162.7 164.3 -1.0% EBITDA 38.8* 43.9* -11.6% Depreciation/ Amortisation (24.0) (23.1) +3.9% Operating Profit 14.8 20.8 -28.8% * Before restructuring charges

  10. Slide 10: Operations

    Operations ƒ Irish Ferries ƒ Ireland – UK - 4,500 sailings per annum ƒ Ireland – France - 300 sailings per annum ƒ Ship chartering - 2 vessels chartered to P&O

  11. Slide 11: Ship Chartering Division

    Ship Chartering Division Pride of Bilbao Night Ferry; 2400 beds, 580 cars, built 1986 Challenger Day Ferry; 600 cars or 108 trucks built 1995 Pride of Cherbourg

  12. Slide 12: Ship Chartering Division

    Ship Chartering Division ƒ Use of ship market knowledge and balance sheet strength to avail of potential charter opportunities in ferry and container shipping markets. ƒ “Pride of Bilbao” on charter to P&O since 1992. Next optional renewal date October 2007. “Challenger” on charter to P&O, has ultim

  13. Slide 13: Irish Ferries Route Structure

    Irish Ferries Route Structure Larne Stranraer Belfast Cairnryan Dublin Liverpool Rosslare Holyhead Pembroke Rotterdam Roscoff Cherbourg

  14. Slide 14: Irish Ferries Route Structure

    Irish Ferries Route Structure ƒ Focus on short routes with high utilisation of ships. ƒ Major barriers to entry in Holyhead & Pembroke for key slots ƒ UK / Rep. Ireland Routes ƒ Over 91% of cars travel on short routes into Dublin and Rosslare ƒ Over 54% of RoRo units travel on short routes into Dubl

  15. Slide 15: Irish Ferries - Ships

    [rish Ferries - Ships = >_————= TRISH FERRIES

  16. Slide 16: Ulysses

    Ulysses Boeing 747

  17. Slide 17: Car Market

    Car Market 1.4m Cars y/e 31/12/05 Irish Ferries Share - All Ireland 27% - Rep. Of Ireland 44% Larne Stranraer Belfast Belfast Cairnryan Volume CAGR Dublin Last Last Last Galway Dublin% 10 Yrs 5 Yrs 3 Yrs 2005 Liverpool Holyhead Rosslare All Irl Market 0 -3 -3 -8 Cork Rosslare Holyhead Irish Ferries

  18. Slide 18: Market Share – Cars

    Market Share – Cars 2005 Rep. of Ireland All Ireland (UK & Continent) (UK & Continent) % % Irish Ferries 44 27 Stena Line 45 47 P&O Irish Sea 2 16 Irish Sea Express* 2 1 Swansea Cork 4 3 Norfolk Line (Maersk) 1 5 Brittany Ferries 2 1 Total 100 100 * Now ceased operations

  19. Slide 19: Irish Ferries - Distribution

    Irish Ferries - Distribution Car Booking Report Calendar Year 2005 All Markets Share 2005 % Call Centres 24 At our Ports 9 Internet 43 Direct 76 Travel Trade 24 Total 100

  20. Slide 20: Even if the airlines could take your car, they'd probably lose it!

    Even if the airlines could take your car, they'd probably lose it! For real low cost travel, take your car with Irish Ferries. E TM Book 48 hrs. in B aimee lvishCervies @Com ll08705 171717. The Low Fares Ferry Company!

  21. Slide 21: RoRo Freight Market

    RoRo Freight Market 1.6m Freight Units y/e 31/12/05 Irish Ferries Share - All Ireland 13% - Rep. Of Ireland 26% Larne Stranraer Belfast Belfast Cairnryan Volume CAGR Since Last Last Dublin Galway Dublin % 1992 5 Yrs 3 Yrs 2005 All Irl Market 6 4 5 4 Holyhead Liverpool Rosslare Cork Rosslare Irish Fe

  22. Slide 22: Market Share – RoRo

    Market Share – RoRo 2005 Rep. of Ireland All Ireland (UK & Continent) (UK & Continent) % % Irish Ferries 26 13 Stena Line 28 30 P&O Irish Sea 21 27 Norfolk Line (Maersk) 25 26 Swansea Cork 1 0 Seatruck 0 4 Total 100 100

  23. Slide 23: RoRo Freight Traffic (1.6m)

    RoRo Freight Traffic (1.6m) 000s Units Compound Average 1600 Growth Rates 1400 1995 - 2005 1200 50% 3% p.a. 1000 800 Via Northern Ireland Ports 600 72% 400 50% 10% p.a. 200 28% Via Republic of Ireland Ports 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 6% p.a.

  24. Slide 24: RoRo Freight Traffic Key Slots

    RoRo Freight Traffic Key Slots

  25. Slide 25: RoRo Market Analysis

    RoRo Market Analysis Greater Integration between Ireland & UK/Continent 1992 2005 CAGR % % Value of Imports & Exports €45.1bn €233.1bn (e) 13.5% GDP €40.0bn €160.8bn(e) 11.3% Imports & Exports as % of GDP 113% 145%

  26. Slide 26: Ulysses - RoRo Freight

    Ulysses - RoRo Freight 81% night time utilisation 5 years growth at 5% p.a. 100% night time utilisation in 2006 would yield additional €6.6m operating profit or 28.5 cent per share

  27. Slide 27: Irish Ferries Revenue Mix

    Irish Ferries Revenue Mix 2005

  28. Slide 28: Irish Ferries Cost Analysis

    Irish Ferries Cost Analysis 2005 Payroll 30% Port Charges 23%

  29. Slide 29: Fuel Price Movements

    Fuel Price Movements 2005 2004 2003 Variance Crude Average Brent (US Dollars per barrel) 55.4 38.8 28.7 93% Average USD Exchange Rate 1.24 1.22 1.13 (10%) Average Brent (€ per barrel) €44.7 €31.8 €25.4 76%

  30. Slide 30: Fuel Price Movements

    Fuel Price Movements 2005 2004 2003 Variance Product Used by Irish Ferries Heavy Fuel Oil * (per tonne) €217 €147 €153 42% Gas Oil *(per tonne) €420 €296 €240 75% * Including delivery

  31. Slide 31: Restructuring Provision

    Restructuring Provision Benefit Charge 2006 €m €m 2004 Outsourcing crew on French route 8.1 2.5 Shore side restructuring 2.6 0.7 Dublin Ferryport Terminal 1.7 0.9 2005 Outsourcing crew on Irish Sea routes 34.4 5.3* Pension curtailment (5.3) - 41.5 9.4 * Full year benefit €9.5m

  32. Slide 32: Headcount Reduction

    Headcount Reduction Direct Employees Year end 2004 2005 2006 (e) Seagoing 669 559 50 Shore 550 496 480 1,219 1,055 530

  33. Slide 33: Sensitivities for 2006

    Sensitivities for 2006 ƒ Each 1% change in car revenue equals 2.4 cent in EPS. ƒ Each 1% change in RoRo freight revenue equals 1.9 cent in EPS. ƒ Each 1% change in fuel equals 1.9 cent in EPS.

  34. Slide 34: Return on Capital

    Return on Capital Ferries Container Group 2005 2004 2005 2004 2005 2004 €m €m €m €m €m €m Turnover 162.7 164.3 136.4 129.8 298.7 293.3 EBITDA* 38.8 43.9 7.9 5.5 46.7 49.4 EBIT 14.8 20.8 4.2 2.5 19.0 23.3 Average Capital Employed 227.8 254.4 29.1 29.7 256.9 284.1 EBITDA Return on Average Capital Empl

  35. Slide 35: Cash Flow

    Cash Flow 2005 2004 €m €m Trading Profit 19.0 23.3 Depreciation/Amortisation 27.7 26.1 EBITDA 46.7 49.4 Working Capital Movement (5.3) 2.4 Operating Cash Flow 41.4 51.8 Interest (4.9) (6.4) Tax (1.7) (0.4) Capex (13.5) (13.3) Restructuring (3.7) (12.2) Free Cash Flow 17.6 19.2 Dividends/Redemptions

  36. Slide 36: Composition of Net Debt

    COMPOSITION OF NET DEBT CURRENCY €m FIXED* RATE $ 16.5 27 % 3.9% £ 24.6 36% 5.0% € 78.8 48% 4.1% 119.9 42% 4.2% Cash (14.0) Net Debt 105.9 * More than 2 Years

  37. Slide 37: 5 Year Performance Cash EPS

    5 Year Performance Cash EPS 192* 191* 188* 177* Cent 153 151 143 1999 2000 2001 2002 2003 2004 2005 * Pre exceptional

  38. Slide 38: Tax

    TAX ƒ LOW TAX ƒ “Tonnage tax” for Irish shipping activities (very low). Approved / encouraged by EU ƒ Std Corporation Tax for other activities (12.5%) ƒ Low corporate rate going forward

  39. Slide 39: Share Buybacks / Dividends

    SHARE BUYBACKS / DIVIDENDS SHARES % VALUE AV. SHARE PRICE BUYBACKS 2002 2.16m 8.1% €14.5m 6.7 2003 1.23m 4.9% €9.8m 8.0 2004 0.69m 2.9% €7.9m 11.4 TOTAL 4.08m 15.9% €32.2m 7.9 Currently in issue 23.35m Authority to purchase up to an additional 2.3m. Shares (10%) valid up to 2006 AGM. DIVIDEND GROWTH

  40. Slide 40: Conclusion

    Conclusion ƒ No. 1 position - Republic of Ireland / UK & Continent ƒ Significant capacity for growth in freight although tourism will remain challenging ƒ Restructuring of crew costs, virtually complete (90% outsourced) ƒ No significant capex required, while offering best product/service to customer

  41. Slide 41: Operational Gearing

    OPERATIONAL GEARING

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  43. Slide 43: Ulysses - Cars

    Ulysses - Cars 11% day time utilisation (higher in holiday peaks)

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  48. Slide 48: Appendices

    Appendices IRISH CONTINENTAL GROUP

  49. Slide 49: Slide 49

  50. Slide 50: Isle of Inishmore 1997

    Isle of Inishmore 1997 Price: €85m Year Built: 1997 Cars: 855 Trucks: 122 Passengers: 2,200

  51. Slide 51: Jonathan Swift 1999

    Jonathan Swift 1999 Price: €38m Year Built: 1999 Cars: 200 Coaches: 10 Passengers: 800

  52. Slide 52: Ulysses 2001

    Ulysses 2001 Price: €107m Year Built: 2001 Cars: 1,342 Passengers: 1,900 Trucks: 240

  53. Slide 53: Normandy 1982

    Normandy 1982 Price: €20.8m Year Built: 1982 Cars: 420 Passengers: 1,577 Trucks: 43

  54. Slide 54: Irish Continental Group plc Results Presentation March 2006

    IRISH CONTINENTAL GROUP, plc Results Presentation March 2006

  55. Slide 55: Other Slides

    OTHER SLIDES

  56. Slide 56: Car Performance Irish Ferries Market Share

    Car Performance Irish Ferries Market Share Rep. of Ireland % 42% 43% 44% 43% 44% 45 39% 40 35 30 25 20 15 10 5 0 2000 2001 2002 2003 2004 2005

  57. Slide 57: We're clear for rip-off

    (— ) (“We're clear for rip-off” ) Airport taxes. Excess baggage. Parking charges. For real low cost travel, take your car with Irish Ferries. : lyishCerries OCom NI 00353 818 300 400 crseeyor ogee. fhe Low Fares Ferry Company!

  58. Slide 58: If God had meant...

    If God had meant ..re wouldn’t have created deals like this! For real low cost travel, take your car with Irish Ferries. lrishCerries QCom " The Low Fares Ferry Company!

  59. Slide 59: Don't get stuffed by the airlines this Christmas!

    Don't get stuffed by the airlines this Christmas! Ireland - Cheapest Quotes 2 adults + 2 children Out 23 Dec- Back 2 Jan ’06 Ryanair Stansted-Dublin £755 Aer Lingus Manchester-Dublin £408 Irish Ferries | Holyhead-Dublin £222 With Christmas fares this low from Irish Ferries, flying really is for the

  60. Slide 60: Golfers - Don't let the airlines steal your wedge!

    ‘a > Golfers - Don’t let the airlines steal your wedge! calos705 171717. The Low Fares Ferry Company!

  61. Slide 61: When is a low fares airline not a low fares airline?

    Q. When is a low fares airline not a low fares airline? A. When you travel with luggage. lrishCerries Com seaentalieneriaienid deeaemnctemd

  62. Slide 62: RoRo Freight Performance Irish Ferries Market Share

    RoRo Freight Performance Irish Ferries Market Share Rep. of Ireland % 28% 30 27% 27% 27% 27% 26% 25 20 15 10 5 0 2000 2001 2002 2003 2004 2005

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  64. Slide 64: Fuel Price History

    Fuel Price History This slide used last year Brent Crude (brl) vs HFO Dublin (ton) 350.00 60.00 Brent 300.00 50.00 HFO 250.00 $ per Tonne HFO 40.00 $ per Barrel 200.00 30.00 150.00 20.00 100.00 10.00 50.00 - - Jan-03 Mar-03 May-03 Jul-03 Sep-03 Nov-03 Jan-04 Mar-04 May-04 Jul-04 Sep-04 Nov-04 Jan-05

  65. Slide 65: Air v Sea Market Performance

    Air v Sea Market Performance 1995 - 2005 1 2 3 10 % Year Years Years Years TOTAL PASSENGERS Irish Sea Air 8 6 5 7 Irish Sea Ferry -8 -5 -4 -1 Continental Air 20 14 13 14 Continental Ferry -5 -3 1 -2

  66. Slide 66: Market & Irish Ferries Performance 1995 - 2005

    Market & Irish Ferries Performance 1995 - 2005 1 2 3 10 % Year Years Years Years CARS Cross Channel -8 -4 -3 0 Irish Ferries Cross Channel -6 -3 -2 4 Continental Sea 2 -2 1 0 Irish Ferries Continental 5 -3 0 1

  67. Slide 67: Market & Irish Ferries Performance 1995 - 2005

    Market & Irish Ferries Performance 1995 - 2005 1 2 3 10 % Year Years Years Years FVs Cross Channel 4 5 5 10 Irish Ferries Cross Channel 3 5 5 12 Continental Sea 8 4 4 1 Irish Ferries Continental 20 -8 -5 -8

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Irish Continental Group — FY2005 Earnings Presentation on 6ix