Gaztransport & Technigaz Sa · EURONEXT:GTT
Gaztransport & Technigaz Sa — FY2020 Earnings Presentation
64 slides from Gaztransport & Technigaz Sa's earnings presentation, May 19, 2021
Slide 1: Investor presentation FY 2020 Results / Q1 2021 Activity update
Investor presentation FY 2020 Results / Q1 2021 Activity update 19 May 2021
Slide 2: Disclaimer
Disclaimer This presentation does not contain or constitute an offer of securities for sale or an invitation or inducement to invest in securities in France, the United States or any other jurisdiction. It includes only summary information and does not purport to be comprehensive. No representation,
Slide 3: Agenda
Agenda 1. GTT, a leading technology provider committed to energy transition 2. Key operational highlights 3. Focus on innovation 4. GTT, well positioned for growth on the LNG value-chain 5. Conquering the new frontiers of energy transition 6. Financials 7. 2021 Outlook & Conclusion Appendices 3
Slide 4: GTT, a leading technology provider committed to energy transition
1 GTT, a leading technology provider committed to energy transition 4
Slide 5: Technology for a sustainable world
Technology for a sustainable world A comprehensive range of technologies & services GTT “Raison d’être” to enable decarbonization Shipping & storage of LNG Our mission is to conceive cutting edge technological solutions for an improved energy efficiency. We bring our passion for innovation and Green
Slide 6: Building trust with all LNG stakeholders for over 50 years
Building trust with all LNG stakeholders for over 50 years Unique provider of cutting-edge Extensive services offering to shipowners membrane technologies NO 96 systems Consulting Engineering Training 1 Mark III systems LNG Tests operations 2 Maintenance Emergency Two membranes and two layers of ins
Slide 7: A unique technology expertise relying on IP and human capital
A unique technology expertise relying on IP and human capital Dynamic IP strategy Unique combination of skills Patent portfolio has an average life of 16 years +60 >80% +2,150 +350 +500 c.€500k Patent Engineers & Active patents Inventions Employees Training Budget applications technicians 1st place
Slide 8: ESG responsibility at the core of GTT's DNA
ESG responsibility at the core of GTT’s DNA Environment Social Governance Net Zero carbon ambition Proactive gender diversity Management for 2025 policy compensation linked to ESG factors (c.30% of Commitment for Intensive training and skills variable part and LTI) decarbonization development Govern
Slide 9: Key operational highlights
2 2020-2021 Key operational highlights 9
Slide 10: Key operational Highlights
Key operational Highlights FY 2020 Revenues: €396 million, up 37.5% Sustained and diversified new orders in LNG shipping & storage - 2020: 41 LNGCs, 4 VLECs1, 1 FSRU, 2 FSU, 3 Onshore storage - 2021: 6 LNGCs, 2 VLECs (as at 19 May 2021) Final Investment Decision in February 2021 for developing Qatar
Slide 11: Orderbook at 31 March 2021
Orderbook at 31 March 2021 CORE BUSINESS Order book: 125 units Q1 2021 movements in the order book 105 LNGC 1 FLNG New orders: 2 (2 LNGC) 5 VLEC 6 Onshore storage Deliveries: 24 (19 LNGC, 4 VLEC, 1 FSRU) 2 FSU 3 GBS 3 FSRU NEW BUSINESS (LNG FUEL) Order book: 12 units Q1 2021 movements in the order b
Slide 12: 2020: a year of targeted acquisitions
2020: a year of targeted acquisitions Feb-20: acquisition of Marorka (Iceland), an expert in smart shipping • Rationale: accelerate development in digital activities Jul-20: acquisition of OSE Engineering (France), an expert in smart algorithms • Rationale: modelling complex systems, optimising engi
Slide 13: KFTC - Appeal procedure update
KFTC - Appeal procedure update Nov-20: KFTC announced its decision following its investigation regarding GTT’s commercial practices in relation to the construction of LNG carriers • KFTC requests that GTT allows shipyards which would so request to perform all, or part of the technical assistance ser
Slide 14: Focus on innovation
3 Focus on innovation 14
Slide 15: R&D and innovation are at the heart of GTT's development
R&D and innovation are at the heart of GTT’s development Selected innovations over the past decade GTT in 2010 GTT in 2020 Launch of 2011 Mark III Flex Technology Launch of NO96 GW and creation of 2012 Cryovision R&D budget R&D budget €8m 1st order of €30m 2014 6 Very Large Ethane Carriers Entry in
Slide 16: GTT technologies provide a key competitive advantage
GTT technologies provide a key competitive advantage Performance of GTT technologies Value of reducing boil-off rate (BOR) LNG boil-off rate of GTT systems developed since 2010 Value creation Implied significant 0,15% cost savings 1 CO2 savings: c.$1.4m(1) per year and per vessel 2 Fuel savings: c.$
Slide 17: 2021 innovation update: GTT conquers new technological frontiers
2021 innovation update: GTT conquers new technological frontiers for its clients Segment Membrane Multigas Digital LNG Fuel Boil-Off Ammonia solutions Large-capacity reduction readiness Maintenance container ships optimization Technology Courtesy of Excelerate Energy Mark III Embarked tank AiP NO96
Slide 18: GTT, well positioned for growth on the LNG value-chain
4 GTT, well positioned for growth on the LNG value-chain 18
Slide 19: Gas, at the core of energy transition
Gas, at the core of energy transition Gas share in the energy mix (Consumption in Exajoules) +76 EJ 65 28 10 692 (27) 616 2025 Oil & Coal Other (incl. Gas Wind, Solar & Hydro 2040 Bio & Nuclear) Gas in the only fossil energy to grow in the long term, gaining share in the energy mix LNG set to be a k
Slide 20: LNG demand estimated to double by 2040
LNG demand estimated to double by 2040 2040 LNG demand outlook(1) (In mtpa) 800 high case 700 low case 600 WoodMackenzie (Q4 2020) (2) 500 BP (Q3 2020) Shell High case (Q1 20) 400 Shell low case (Q1 2020) Morgan Stanley (Q1 2021) IEA (Q4 2020) (3) 300 Exxon Mobil (Q4 2019) Cedigaz (Q4 2020) 200 2015
Slide 21: Asia to remain the key growth for LNG, mainly driven by China
Asia to remain the key growth for LNG, mainly driven by China LNG demand in 2040 Top 7 LNG demand countries in 2040 In Mtpa 127 63 59 717 mtpa 49 40 31 China India Japan South Indonesia Bangladesh Korea LNG demand is expected to largely remain in Asia in 2040 (market share above 70%) +273 Mtpa for
Slide 22: Increasing imbalance will require new capacities to transport LNG
Increasing imbalance will require new capacities to transport LNG in the coming decades LNG supply & demand balance forecast(1) (in Mtpa) 800 700 600 ~300 Mtpa ~370 Mtpa 500 mtpa 400 300 200 100 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 202
Slide 23: c.100 more LNGCs required for liquefaction projects under construction
c.100 more LNGCs required for liquefaction projects under construction LNGCs supply demand balance of Under Construction liquefaction plants Contracted Forecasted Project Location Capacity LNGCs requirement Start-Up (mtpa) Tangguh Phase 2 Indonesia 2022 3,8 2 Sabine Pass T6 US East 2022 4,5 10 Coral
Slide 24: GTT is well positioned to capture orders from vessel renewals
GTT is well positioned to capture orders from vessel renewals LNGC carriers(1) with charter contract ending by 2024 90 LNGC chart contract to end by 2024 Of which 55 equipped with steam turbine propulsion; also, smaller 5 vessels (<145k cbm) 4 4 4 Charterers and ship-owners to intensify the shift
Slide 25: Growing long-term estimates for GTT orders
Growing long-term estimates for GTT orders Estimated GTT’s cumulated orders over 2021-2030 Between LNGC 290 & 320 units Between VLEC 25 & 40 units Between FSRU 10 & 20 units(1) FLNG Up to 5 units Onshore & Between GBS tanks 25 & 30 units Notes: (1) Exclude conversion of existing LNG carrier into FSR
Slide 26: Conquering the new frontiers of energy transition
5 Conquering the new frontiers of energy transition 26
Slide 27: Promoting LNG as fuel to accelerate energy transition
Promoting LNG as fuel to accelerate energy transition 27
Slide 28: Rising pressure by the IMO to act on climate change
Rising pressure by the IMO to act on climate change Energy Efficiency Design Index (EEDI) targets set by the IMO 23,000 boxes containership EEDI (g.CO2/t.mile) 2050 target will be 16 (70)% reached only by using low-carbon 13 shipping fuel 9 5 2008 baseline 2020 phase 2 2030 2050 target target By 205
Slide 29: LNG is the lowest carbon-fuel for shipping currently viable
Among possible solutions, LNG is the lowest carbon-fuel for shipping currently viable Scalability/ Technical Economy Environment Safety Marine fuel Infrastructure (feasibility) (affordability) (acceptability) (guarantee) (availability) Lowest fuel cost Net carbon with bio LNG Stable price and synthe
Slide 30: Promising LNG as fuel market potential for GTT
Promising LNG as fuel market potential for GTT Annual shipping orders (excl. gas carriers) and Targeted market for GTT LNG as fuel market share 5 000 10% 4 500 9% Yearly vessel order of 4 000 8% 1 c.1,500-2,000 in 2021-26 c.1,500-2,000 # vessels ordered Ships ordered LNG as fuel market share 3 500 7
Slide 31: Smart shipping: Optimizing energy-efficiency with digital solutions
Smart shipping: Optimizing energy-efficiency with digital solutions 31
Slide 32: Smart shipping: Digital Technologies for optimized energy efficiency and safety
Smart shipping: Digital Technologies for optimized energy efficiency and safety Positioning in a fast-growing market GTT strategic proposition Strong growth drivers: In $m - Environmental issues Recognized provider of vessel - Need for transparency performance solutions for LNG, LNG as - Cost reduct
Slide 33: Smart Shipping: GTT has all skills to become a reference player
Smart Shipping: GTT has all skills to become a reference player thanks to innovative and differentiating solutions In-depth Proprietary internal Targeted Supportive market knowledge of the know-how acquisitions trends maritime industry LNG expertise and Value-added Successful integration Increasing
Slide 34: Playing a key role in the green hydrogen revolution
Playing a key role in the green hydrogen revolution 34
Slide 35: GTT ambitions to play a key role in the green hydrogen revolution
GTT ambitions to play a key role in the green hydrogen revolution Become a Tier 1 2030 player in green hydrogen Compelling rationale and strategic fit with GTT GTT and Elogen share a common DNA: strong focus on technology, R&D, innovation and customers looking for reliability and long-term support
Slide 36: Green hydrogen market potential: a booming market
Green hydrogen market potential: a booming market Drivers of European green hydrogen market European Commission Strategic Plan (Jul-20) Shift towards production of green hydrogen is The European Commission has disclosed its 3-step emerging in Europe Strategic Plan for the deployment of green hydroge
Slide 37: Elogen to become a Tier 1 electrolysis provider
Elogen to become a Tier 1 electrolysis provider over the coming decade Geographical footprint End-markets Technologies Focus on Western Europe Small electrolysis Elogen today Trucks, buses, light industry (500 kW – 2 MW) Extend Strengthen Diversify Global reach Elogen in 2030 Large mobility segment,
Slide 38: Elogen's new contract, a significant milestone
Elogen’s new contract, a significant milestone April 2021: Elogen selected by German energy company E.ON Supply of a 1MW electrolyser, a transformer and a compression unit Elogen will also provide for the R&D development of a hydrogen purification unit The SmartQuart project, a full scale laboratory
Slide 39: Financials
6 Financials 39
Slide 40: Order book offers longer visibility
Order book offers longer visibility Order book in units Order book by year of delivery (units per year)(1) In units In units (1) 147 Order book at Dec. 31, 2019 Order book at Jun. 30, 2020 Order book at Dec. 31, 2020 63 133 135 53 54 38 32 28 21 15 12 5 6 As at Dec. 31, As at Jun. 30, As at Dec. 31,
Slide 41: FY 2020: Strong financial performance
FY 2020: Strong financial performance Summary consolidated accounts Key highlights in €M FY 2019 FY 2020 Change Revenues: +37.5% Total Revenues 288.2 396.4 +37.5% • Newbuilds (royalties): +39.6% EBITDA (1) 174.3 242.7 +39.2% Royalties from LNGCs fully benefit from Margin (%) 60.5% 61.2% the last two
Slide 42: FY 2020: Cost base
FY 2020: Cost base GTT consolidated operational costs Key highlights in €M FY 2019 FY 2020 Change (%) External costs: +27% Goods purchased (7.1) (8.7) 22.5% • Subcontractors: +43%, directly linked to the increase of order book % sales -2% -2% • Travel expenditures: -27% due to the COVID crisis Subco
Slide 43: 2020 Dividend: delivering on guidance
2020 Dividend: delivering on guidance 2018 2019 2020 Consolidated net profit (IFRS) €142.8 M €143.4 M €198.9 M Net earnings per share(1) €3.85 €3.87 €5.36 Total dividend Dividend per share €3.12 €3.25 €4.29 Payout ratio(2) 81% 84% 80% Dividend amount +32% 4,29 Balance dividend of €1.79(3) Record dat
Slide 44: Q1 2021 consolidated revenues
Q1 2021 consolidated revenues Summary financials Key highlights Q1 2020 Q1 2021 Change in euro thousand (%) Total revenues: €87.6 million (-15 %) Revenues 102 481 87 557 -15 % Revenues from newbuilds (royalties): Newbuilds 99 433 82 846 -17 % €82.8 million (-17 % vs 2020 peak) % of revenues 97 % 95
Slide 45: 2021 Outlook & Conclusion
7 2021 Outlook & Conclusion 45
Slide 46: FY 2021 outlook
FY 2021 outlook Revenues(1) • Order book at high level translating into strong revenues visibility (until 2025) 2021 consolidated revenue • Most 2020 orders will be delivered over a estimated in a range of €285M longer period than usual and will generate to €315M(4) limited revenues in 2021 EBITDA •
Slide 47: Conclusion
Conclusion GTT teams are committed to building a sustainable world 47
Slide 48: Appendices
GIT Appendices
Slide 49: French technology company with a global footprint
French technology company with a global footprint Develops training and simulation tools for gas officers operating on LNG carriers (UK) Digital & smart shipping expert acquired in February 2020 (Iceland) HQ near Paris Focuses on Gives GTT Expert in model Offers business access to the based system i
Slide 50: A unique expertise valued from shipyards to O&G majors for over 50 years
A unique expertise valued from shipyards to O&G majors for over 50 years Oil & Gas companies are Shipowners are GTT’s end GTT’s end clients and clients and prescribers prescribers GTT’s technology receives certification & approval Shipyards are GTT’s direct from classification clients societies 50
Slide 51: Order book evolution in FY 2020
Order book evolution in FY 2020 LNGC 113 +41 (32) 122 VLEC 6 +4 (1) 9 FSRU - +1 (3) 4 FSU 0 +2 - 2 FLNG 2 - (1) 1 Onshore Storage 3 +3 - 6 GBS 3 - - 3 GTT order book movements 51
Slide 52: Cutting-edge technologies to help our customers meet the challenges of energy transition
Cutting-edge technologies to help our customers meet the challenges of energy transition Energy transition drivers GTT businesses Reduction of the level of LNGC CO2 Shipping & Gas getting greener emissions by c.40% over the last 10 storage of LNG years (25)% CO2 emissions vs. HFO Energy efficiency (
Slide 53: A wide range of applications proposed for gas shipping and storage
A wide range of applications proposed for gas shipping and storage Core business 1 GTT’s core business with over 50 years of expertise LNG Shipping End of 2020: order book of 122 LNG carriers EXTENSION OF GTT’S OFFERING 2 Development of floating LNG storage and regasification Solutions for units (FS
Slide 54: Innovations with outstanding commercial successes
Innovations with outstanding commercial successes Selected examples Significant investments for the Development of multi-gas development Gravity Based transport offering since 2014 Structures (GBS) In 2014, first order of 6 ethane carriers In 2018, appointed by two major companies to carry out F
Slide 55: Significant advantages compared to competing technologies
Significant advantages compared to competing technologies Overview of GTT technology advantages 6 key success factors Moss SPB KC-1 Outstanding track-record within LNG sector Membrane Spherical Prismatic Membrane Technology (Mark III, Technology Technology NO96, GST) Long-standing customer relations
Slide 56: Regulation will drive significant changes in the shipping industry
Regulation will drive significant changes in the shipping industry Overview of main shipping emissions regulations and targets Mostly focus on NOx and SOx Focus on GHG emissions reduction emissions reduction IMO Global EEXI3) EEDI1) Sulphur Scheme CO2 phase scheme 2020 Cap (proposed) out 2015 2021 2
Slide 57: LNG as fuel technology already adopted by key players in the industry
LNG as fuel technology already adopted by key players in the industry LNG as fuel represents a unique opportunity for the maritime industry Improvement Long-term of the ESG profile + cost savings Nov-20: Decision to Dec-19: order acquire a new Hudong-Zhonghua generation of 26 LNG Shipbuilding, for t
Slide 58: LNG as fuel competitive landscape
LNG as fuel competitive landscape Type B Type C • Self supported cylindrical • Integrated tank • Self supported tank Technology tank • Atmospheric pressure • Atmospheric pressure • Pressurized Space optimization Boil-off High cost (much metal Lower cost (foam), high Capex Moderate cost
Slide 59: Elogen is positioned on highly competitive PEM segment
Elogen is positioned on highly competitive PEM segment ELECTROLYSIS Elogen positioning Process of using electricity to split water into PEM Technology hydrogen and oxygen Alcaline Technology High innovation potential Historical technology, more frequently used than PEM Most adapted technology
Slide 60: GTT's strategic roadmap
GTT’s strategic roadmap 6. Transformation Technology for a Hydrogen electrolysers sustainable world Smart shipping Gas handling technologies 2. Enhancement Offshore Multigas LNG as GBS fuel LNG Carriers Evolution of NO 96 Transfer & Mark operations 1. Intensification systems 5. Enlargement 3. Improv
Slide 61: An attractive business model supporting high cash generation
An attractive business model supporting high cash generation Invoicing and revenue recognition Business model supports high cash generation % of contract (1) Revenue is recognized pro-rata temporis c. 9 to12 months c. 18 months Delivery between construction milestones 10000 studies royalties Initial
Slide 62: GTT Net Zero ambition by 2025
GTT Net Zero ambition by 2025 GTT’s Approach In 2020, GTT began a structured approach to define its ambitions in terms of decarbonization, both on its own scope and its impact scope of emissions GTT’s own scope GTT’s impact scope GTT has defined a reduction action plan in order Concerning the mariti
Slide 63: Glossary
Glossary The following abbreviations have been used throughout this document M-type, Electronically Controlled Gas BOR Boil Off Rate FSU Floating Storage Unit MEGI Injection APAC Asia-Pacific GBS Gravity Based Structure Mtpa Million tons per annum CAGR Compound Annual Growth Rate GHG Greenhouse Gase
Slide 64: Contact
Contact: information-financiere@gtt.fr / +33 1 30 23 20 87
GTT (Gaztransport & Technigaz) — FY2020 Earnings Presentation on 6ix