Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Norden — FY2015 Earnings Presentation
33 slides from Dampskibsselskabet Norden A/s's earnings presentation, Mar 2, 2016
Slide 1: NORDEN Results – Annual Report 2015
NORDEN RESULTS Annual Report 2015 Hellerup, Denmark 2 March 2016 NORDEN – ANNUAL REPORT 2015 RESULTS | 1 Our business is global tramp shipping
Slide 2: Agenda
AGENDA Group highlights Financials Dry Cargo Tankers 2016 expectations Q&A NORDEN – ANNUAL REPORT 2015 RESULTS | 2 Our business is global tramp shipping
Slide 3: 2015 Highlights
2015 HIGHLIGHTS EBIT Key messages 200 2015 result heavily impacted by 105 Guidance 100 45 continued downturn in dry cargo 0 market USD million -51 -45 -100 USD 58 million in EBIT excl. -200 impairment and provision -300 -265 -282 USD -340 million in impairment and -400 -335 provision 2011 2012
Slide 4: Record Tanker Result – OK Dry Cargo Result
FINANCIALS RECORD TANKER RESULT – OK DRY CARGO RESULT EBIT – Dry Cargo EBIT - Tankers 200 150 127 117 100 120 0 90 Million USD Million USD -100 -46 60 -200 30 13 8 -207 -300 0 -400 -334 -8 -30 -386 -500 -60 -44 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 NORDENs performance vs. 1-year T/C EBIT
Slide 5: Balanced Capital Structure
FINANCIALS BALANCED CAPITAL STRUCTURE USD 77 million in cash flow from operations – in spite early payments on TC-in contracts of USD ~50 million Net commitment lowered by USD 268 million (21%) during 2015 Combined undrawn credit facilities, cash and securities at USD 652 million versus USD 28
Slide 6: 2015 Initiatives Have Improved Financial Position
FINANCIALS 2015 INITIATIVES HAVE IMPROVED FINANCIAL POSITION Adjusted core fleet: 9 vessel sold Cash and Securities 400 Open vessels days in Dry Cargo 350 reduced by 24% in 2016 and 2017 300 USD +127 million USD million 250 Cash and securities increased with 200 150 USD 127 million to USD 366
Slide 7: Dry Cargo Values Continue to Decrease
ASSET VALUES DRY CARGO VALUES CONTINUE TO DECREASE Asset values for Dry Cargo decreased in Q4 2015 – e.g. Panamax down by 20% Tanker values have only seen a small improvement despite strong spot market After impairment the market value of NORDENs fleet is close to book value Value of owned f
Slide 8: Dry Cargo: All Time Low Rate Levels
DRY CARGO ALL TIME LOW RATE LEVELS Baltic Dry Index at historical low levels Average Panamax and Supramax spot rates almost 30 % lower than average rates in 2014 Weak market continued to get weaker in the beginning of 2016 Panamax – spot rate Supramax – spot rate BDI Yearly Average 16.000 16.0
Slide 9: Dry Cargo: No Growth in Global Trade in 2015
DRY CARGO NO GROWTH IN GLOBAL TRADE IN 2015 Decline in the global coal trade China imports down 31% due to protectionism and increased non-fossil energy consumption India market leader in coal imports, but volumes dropped from H1 to H2 Lower than expected iron ore trade due to slowdown in th
Slide 10: Outlook: Market Balance Dependent on Scrapping
DRY CARGO OUTLOOK: MARKET BALANCE DEPENDENT ON SCRAPPING 2016 demand growth expected to be limited Slowdown in Global steel production Coal trade expected to seize declining 2016 fleet growth expected be 1-3 % High scrapping activity of around 5 % Significant slippage and cancellations f
Slide 11: 2015 Was an Excellent Year for Tankers
TANKERS 2015 WAS AN EXCELLENT YEAR FOR TANKERS Highest rates since 2008 Low oil price triggered increased demand and refinery activity 2015 supported by strong gasoline growth – especially in the US, India and China High stock build throughout 2015 supported demand for both crude and product
Slide 12: The Gasoline – Diesel Imbalance Seems Structural
TANKERS THE GASOLINE – DIESEL IMBALANCE SEEMS STRUCTURAL YoY demand growth Diesel and Gasoline (%) YoY clean petroleum product stock change (mbbl) 3,0% 100 84 80 ≈85% of the additional 2,5% stock in 2015 is Diesel 2,0% 60 47 40 1,5% 16 20 6 1,0% 0 0,5% -20 -5 -8 -2 -14 0,0% -40 14 15 16 14 15 16 201
Slide 13: Outlook: Lower Oil Demand Growth and Higher Fleet Growth
TANKERS OUTLOOK: LOWER OIL DEMAND GROWTH AND HIGHER FLEET GROWTH Lower – but still good – oil demand growth in 2016 expected Growth in export refineries is still ongoing Lack of land based storage capacity could lead to offshore storage and benefit the demand for tanker vessels Tanker fleet
Slide 14: 2016 Full Year Guidance
2016 FULL YEAR GUIDANCE Outlook Comments USDm Dry Cargo Tankers Total Adjusted net result USD -60 to 30 Adjusted million results of -85 to -25 25 to 55 -60 to 30 the year Corresponds to EBIT of USD -45 to 45 million CAPEX -40 to -20 Very poor dry cargo market Continued good tanker market but
Slide 15: 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 the remainder of 2016 and subsequent years are subject to uncertainty, and NORDEN’s actual results may therefore differ from the p
Slide 16: Thank you for your attention
Thank you for your attention http://www.linkedin.com/company/ds-norden/ http://twitter.com/DS_NORDEN http://www.facebook.com/shippingtrainee.com http://www.facebook.com/dampskibsselskabetnorden Dampskibsselskabet NORDEN A/S 52, Strandvejen DK-2900 Hellerup Denmark Phone: +45 3315 0451 www.ds-norden.
Slide 17: Back Up Slides
FORWARD BACK UP SLIDES LOOKING STATEMENTS NORDEN – ANNUAL REPORT 2015 RESULTS | 17 Our business is global tramp shipping
Slide 18: A Leading Global Tramp Operator
A LEADING GLOBAL TRAMP OPERATOR 184 DRY CARGO VESSELS PANAMAX SUPRAMAX CAPESIZE POST-PANAMAX HANDYSIZE Modern fleet Global network of offices and port captains Pools in Dry cargo (Handysize & Post-Panamax) and Tankers (MR & Handysize) Tankers 250 200 150 100 50 0 MR HANDYSIZE Dry cargo NORDEN
Slide 19: Development Highlights
DEVELOPMENT HIGHLIGHTS 2015- Strategy: Focus & Simplicity Offices in Melbourne and Santiago 300 2005 2008 275 1871 Financial Norient Mads C. Holm founds NORDEN; first vessel delivered in crisis Product 1872 begins 250 Pool 225 1996-2005 Number of active vessels Offices in Singapore, 1875-76 200 Anna
Slide 20: Asset Light Business Model
ASSET LIGHT BUSINESS MODEL… Active fleet can quickly be adjusted to demand and market conditions Fleet employment based on portfolio view Flexible fleet Coverage and customer focus Capacity Employment CORE FLEET Sale and purchase Customer relations Contracts of Technical competencies in- O
Slide 21: Enabling Value Creation Based on the Cycle and Throughout the Cycle
…ENABLING VALUE CREATION BASED ON THE CYCLE AND THROUGHOUT THE CYCLE Exploiting the cycle Creating value throughout the cycle Taking a view on the fundamental market and adjusting our Creating value above industry level irrespective of market exposure conditions Levers: Levers: Commercial operations
Slide 22: Overall Results
OVERALL RESULTS USDm 2013 2014 2015 Q4 2015 EBITDA - Dry Cargo -5 -294 -112 -149 EBITDA - Tankers 39 45 142 28 Unallocated -10 -12 -9 -1 EBITDA - Group 24 -261 21 -120 Depreciation -79 -68 249 -197 EBIT Group -51,3 -95 -282 -369 Results of the year -48 -416 -285 -377 Adjusted Results of the year -61
Slide 23: Impairment and Provision Announced Jan. 2016
IMPAIRMENT AND PROVISION ANNOUNCED JAN. 2016 - EQUITY ALIGNED WITH ”VALUE IN USE” Effect of provisions made in 2014 and 2015 Impairment of book values of owned Incl. JV 2014 2015 2016 2017 2018 2018+ vessels: USD 180 million USD million Provision on onerous TC-in contracts: 2014 -230 80 70 60 10
Slide 24: New Measure for Earnings (TCE)
VALUE CREATION NEW MEASURE FOR EARNINGS (TCE) NORDENs dry cargo business is a mixture of core fleet and operation activities Operator activities Focus on the margin created when cargoes and vessels are combined New NORDEN TCE = Total TCE earnings from the core fleet + the contribution margin
Slide 25: New Building Prices
NEW BUILDING PRICES Panamax (Dry) MR (Tank) 60 60 50 50 40 40 USD million USD million 30 30 20 20 10 10 0 0 NORDEN – ANNUAL REPORT 2015 RESULTS | 25 Our business is global tramp shipping
Slide 26: Dry Cargo: 12 Month Rolling Average
USD/day USD/day 0 10.000 20.000 30.000 40.000 50.000 Capesize 0 10.000 20.000 15.000 25.000 5.000 DRY CARGO Supramax Jan-10 Jan-10 Jul-10 Jul-10 Jan-11 Jan-11 Jul-11 Jul-11 Jan-12 NORDEN – ANNUAL REPORT 2015 RESULTS | 26 Jan-12 Jul-12 Jul-12 Jan-13 Jan-13 Jul-13 Jul-13 Jan-14 Jan-14 Jul-14 Jul-14 Ja
Slide 27: Financial Strength
FINANCIAL STRENGTH Solid capital structure Net committed cash Strong focus on cash flow generation USDm 2015 2014 2013 Cash in low-risk deposit accounts and Adjusted net interest bearing -6 -6 189 assets* securities T/C obligations** -1,372 -1,542 -1,861 Equity ratio at 53.3% Newbuilding insta
Slide 28: Fleet Values
FLEET VALUES NORDEN – ANNUAL REPORT 2015 RESULTS | 28 Our business is global tramp shipping
Slide 29: Dry Cargo Fleet Overview
DRY CARGO FLEET OVERVIEW NORDEN's Dry Cargo fleet and values at 31 December 2015 Vessel type Capesize Post-Panamax Panamax Supramax Handysize Total Vessels in Operation Owned vessels 2 4 4 4 12 26 Chartered vessels with period above 13 months 1 4 19.5 16 12 52.5 Total active core fleet 3 8 23.5 20 2
Slide 30: Product Tanker Fleet Overview
PRODUCT TANKER FLEET OVERVIEW NORDEN's Tanker fleet and values at 31 December 2015 Vessel type LR1 MR Handysize Total Vessels in Operation Owned vessels 0 9 13 22 Chartered vessels with period above 13 months 0 17 2 19 Total active core fleet 0 26 15 41 Chartered vessels with peiod under 13 months 0
Slide 31: Dry Cargo
DRY CARGO NORDEN – ANNUAL REPORT 2015 RESULTS | 31 Our business is global tramp shipping
Slide 32: Product Tankers
PRODUCT TANKERS NORDEN – ANNUAL REPORT 2015 RESULTS | 32 Our business is global tramp shipping
Slide 33: The Share (DNORD)
THE SHARE (DNORD) Master data Composition of shareholders 15,895 registered shareholders owning Shareholder capital DKK 42,200,000 88.3% Number of shares and Approx. 30.5% international ownership denomination 42,200,000 shares of DKK 1 Classes of shares 1 Voting and ownership restrictions None A