Euroseas Ltd. · NASDAQ:ESEA
Euroseas — Jefferies 4th Annual Shipping, Logistics & Offshore Service Conference (September 2007)
25 slides from Euroseas's conference presentation, Sep 26, 2007
Slide 1: Presentation at Jefferies 4th Annual Shipping, Logistics & Offshore Service Conference
Presentation at Jefferies 4th Annual Shipping, Logistics & Offshore Service Conference September 26, 2007 New York City, NY
Slide 2: Forward-Looking Statements
Forward- Forward-Looking Statements "forward--looking statements" within the meaning of federal securities laws. Statements in this presentation may be "forward laws. forward--looking statements are based on current management expectations The matters discussed herein that are forward that involve r
Slide 3: Euroseas Background
Euroseas Background » Euroseas is a provider of worldwide dry cargo transportation services. We own: • Drybulk carriers – transporting iron ore, coal and grains and minor bulks • Container and multipurpose ships – transporting dry and refrigerated cargoes » Formed by industry veterans in June 2005 –
Slide 4: Our Fleet – Vessels
Our Fleet – 14 Vessels Size Year Employment/ Gross Name Type DWT TEU Built Expiration Date Charter Rate ARISTIDES N.P. Panamax 69,268 - 1993 Period/January ’08 $29,000 IRINI Panamax 69,734 - 1988 Pool/December ’08 $17,000 - $20,000(1) Carriers Drybulk NIKOLAOS P. Handysize 34,750 - 1984 Period/Novem
Slide 5: History of Growth 2006-2007
History of Growth 2006- 2006-2007 Fleet Fleet Growth Growth Market Market Capitalization Capitalization 14 400 15 350 300 +100% +202% 10 17 17 250 million vessels 7 yrs yrs 200 150 5 20 20 100 yrs yrs 50 0 0 (2) Sep-05 Sep-07 Sep-05 Sep-07 TCE TCE Revenues Revenues EBITDA EBITDA 30 35 30 25 +54% 25
Slide 6: Focused Business Strategy
Focused Business Strategy » Focus on timely and selective acquisitions of quality middle age secondhand vessels • Drybulk carriers – up to Panamax size (75,000 dwt) • Container ships – feeders and sub-panamax up to 2,500 teu • Segments with lower supply growth & multiple trading routes and cargoes »
Slide 7: Market Positioning
Market Positioning Euroseas provides a QMAR unique investment Drybulk alternative in dry DSX Containership shipping by focusing DRYS on: Average Vessel Size (dwt) SSW OCNF GNK DAC Operating smaller, EXM more flexible EGLE vessels Investing on middle ESEA TBSI (MPP; Liner) age vessels and achieving h
Slide 8: Superior Return On Capital and Equity
Superior Return On Capital and Equity Return Return On On Capital Capital Employed Employed ROCE ROCE (% p.a.) (1,2) (% p.a.) (1,2) 30% 25% 20% 15% 10% 5% 0% 2006 2007H1 Euroseas Drybulk & Container Peer Group (1) Based on public filings; computations performed by the Company. (2) Peer group include
Slide 9: Example of Drybulk Investment: m/v Gregos
Example of Drybulk Investment m/v Gregos » Purchased m/v Gregos in Feb-2007, a 20 38,434 dwt 1984 built drybulk vessel for 18 $13.15 million 16 » Average daily TCE earnings to-date: 14 approximately $27,000/day; Next Next 12 12 12 million ($) Current daily earnings: $43,000 months, months, 10 presen
Slide 10: Charter Coverage – 2007Q4 & 2008
Charter Coverage – 2007Q4 & 2008 90% Dry Bulk 82% 78% Container 80% 70% Total 70% 58% 60% 50% 45% 40% 30% 20% 11% 10% 0% 2007Q4 2008 Secure base revenue in 2007-Q4 and 2008 for the existing fleet » 78% of our 2007 remaining available days are fixed with an average rate of abt $18,500 /day » 45% of o
Slide 11: Fleet Management & Operational Performance
Fleet Management & Operational Performance » Management is performed by Eurobulk Ltd., Daily costs per vessel an affiliate 7,000 • Top management – 100+ years of 6,000 industry shipping experience 5,000 • 13 year history of managing older dry- $ / day 4,000 cargo vessels 3,000 » Fleet utilization ra
Slide 12: Rapid Debt Repayment
Rapid Debt Repayment Front Front Loaded Loaded Debt Debt Repayment Repayment Schedule Schedule ($ ($ mm) mm) » Debt / capitalization: • 33% in 2007Q2 (giving $20 effect to our follow-on $18.4 $18.2 offering) Additional cash flow available for $15 dividends or further growth » Debt / Market value of
Slide 13: Low Cash Flow Breakeven
Low Cash Flow Breakeven » Cost effective vessel operations – targeted daily cash breakeven cost of $10,200/day/vessel • Current gross fixed charter rate coverage for 2008 of $17,000 ($15,800 net) » Low cost structure generates attractive margins » Solid dividend coverage of at least 1.15x even witho
Slide 14: Market Trends
Market Trends
Slide 15: Improving Market Trends: Dry Bulk & Containership
Improving Market Trends: Dry Bulk & Containership Historical Historical 1- 1--yr 11- yr Period Period Charter Charter Rates ($/Day)(1) Rates ($/Day) (1) $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -
Slide 16: Opportunities in Containerships
Opportunities in Containerships Historical Historical Prices Prices –– 15 15 year year old Vessels(1) old Vessels (1) $60 $50 $40 million $30 $20 $10 $0 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -01 20 -05 20 -09 20 -01 20 -05 9 -0 02 02 02 03 03 03 04 04
Slide 17: Dry Bulk Demand Driven by Asia
Dry Bulk Demand Driven by Asia » Demand linked to world economic growth Selected Selected Bulk Bulk Imports China(1) Imports –– China (1) • World GDP expected up 4.7% mil. tons in ’07 after growing 5.1% in ‘06 450 400 » Strong demand from all over the 350 a. world for raw materials 300 p. : 25 % • C
Slide 18: Strong Containership Demand Driven by Global Trade
Strong Containership Demand Driven by Global Trade » Globalization a key factor: China has become the Container Container Exports China(1) Exports –– China (1) manufacturing hub since her mil. teu admission to WTO in 2001 35 30 » Strong demand for finished goods a. from developed world, and, 25 p. %
Slide 19: Vessel Supply
Vessel Supply Dry Dry Bulk Bulk Current Current Order Order Book Book (million dwt) (1) (million dwt) (1) Containers Containers Current Current Order Order Book Book (million teu) (1) (million teu) (1) 11% over 25 years of age 4% over 25 years of age mil. dwt mil. teu 3000+ Cape 70 1.8 2000-3000 Pan
Slide 20: Dividends & Valuation
Dividends & Valuation
Slide 21: Dividend History & Policy
Dividend History & Policy Dividend Dividend History History since since 2006 2006 Dividend Dividend Policy Policy 0.25 » Objective to provide consistent dividends 0.20 • Dividend for 07 Q2: $0.25/share 0.15 • Next dividend in Nov- Nov-2007 $ / share » Current dividend equates to about 0.10 7.1% annu
Slide 22: Dividend Yield & Payout Ratio Compared to Peers
Dividend Yield & Payout Ratio Compared to Peers Dividend Dividend Yield Yield (2008), (2008), Dividend Dividend Payout Payout of of Net Net Income Income (2008), (2008), “High” “High” Yield Stocks (1,2) Yield Stocks (1,2) “High” “High” Yield Yield Stocks Stocks (1,2) (1,2) 8% 120% 7.3% 7.2% 105% 7%
Slide 23: Valuation Ratios Compared to Peers
Valuation Ratios Compared to Peers EV EV // EBITDA (2008) (1,2) EBITDA (2008) (1,2) P P // E (2008) (1,2) E (2008) (1,2) 12 16 14 10 10.0 12 13.7 8 10 6 8 6.0 8.7 6 4 4 2 2 0 0 Euroseas Drybulk & Container Euroseas Drybulk & Container 1.5 P NAV (1,2) P // NAV (1,2) 1.4 1.4 1.40 1.3 1.3 (1) Based on
Slide 24: Euroseas: Full Speed Ahead
Euroseas: Full Speed Ahead » Executed on strategy • positioned to take advantage of shipping markets while controlling market risks » Consistent growth over last two years • Fleet grew by 100% since August-2005 » Significant purchasing power to further expand fleet • Current leverage is about 20% »
Slide 25: Euroseas Contacts
Euroseas Contacts Euroseas Ltd. Aethrion Center 40, Ag. Konstantinou Street 151 24 Maroussi, Greece www.euroseas.gr euroseas@euroseas.gr Tel. +30-211-1804005 Fax.+30-211-1804097 or, Tasos Aslidis Nicolas Bornozis Chief Financial Officer Investor Relations Euroseas Ltd. Capital Link, Inc. 11 Canterbu