Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Q2 2022 Earnings Presentation
27 slides from Dampskibsselskabet Norden A/s's earnings presentation, Aug 18, 2022
Slide 1: Presentation of Second Quarter 2022 Results
PRESENTATION OF SECOND QUARTER 2022 RESULTS Copenhagen, Denmark, 18 August 2022
Slide 2: Agenda for Today
AGENDA FOR TODAY 01. Second quarter 2022 highlights 02. Business unit performance • Assets & Logistics • Freight Services & Trading 03. Market development & outlook 04. Guidance for 2022 and sum-up 2 PRESENTATION OF SECOND QUARTER 2022
Slide 3: Second Quarter 2022 Highlights
01. SECOND QUARTER 2022 HIGHLIGHTS 3 PRESENTATION OF SECOND QUARTER 2022
Slide 4: Second Quarter 2022 Highlights: Business Update
01. SECOND QUARTER 2022 HIGHLIGHTS BUSINESS UPDATE GROUP HIGHLIGHTS GROUP PROFIT LAST FIVE QUARTERS 179 180 PROFIT FOR Q2 2022: USD 179 MILLION 150 123 117 • Fantastic result for Q2 120 USD million • Significant shift in market exposure from dry cargo to product tankers 90 65 • Profit for the year b
Slide 5: Significant Shift in Market Exposure
01. SECOND QUARTER 2022 HIGHLIGHTS SIGNIFICANT SHIFT IN MARKET EXPOSURE Relative NORDEN segment exposure 80% 70% • From mostly dry cargo exposure to mostly product 60% tanker exposure Segment risk use % • Proactive shift since 2nd half of 2021 ahead of 50% 1) surge in product tanker rates, and 2) we
Slide 6: Shareholder Cash Distributions Since 2020
01. SECOND QUARTER 2022 HIGHLIGHTS SHAREHOLDER CASH DISTRIBUTIONS SINCE 2020 • Over USD 450 million returned since 2020 (when including recently announced share buyback programme on 18 Aug) • Net share count reduced by 9% since 2020 Paying out most of earnings (2020-2022) USD million 2022 296 YTD 85
Slide 7: Business Unit Performance
02. BUSINESS UNIT PERFORMANCE 7 PRESENTATION OF SECOND QUARTER 2022
Slide 8: Assets & Logistics: Significant Increase in Value of Portfolio
02. ASSET & LOGISTICS SIGNIFICANT INCREASE IN VALUE OF PORTFOLIO NAV per share (end Q2) PROFIT FOR Q2 2022: USD 26 MILLION 400 377 350 • Exceptional product tanker rates increasing business unit NAV to DKK 377 300 262 • Strong dry cargo earnings, fully covered in dry cargo for 2022 and 2023 250 • 3
Slide 9: Extensive Optionality in Portfolio
02. ASSET & LOGISTICS EXTENSIVE OPTIONALITY IN PORTFOLIO • ~62,000 extension option days in total, corresponding to ~170 full-year extension options • Extension options: 81 options in total (58 options on dry cargo vessels and 23 on tanker vessels) • Purchase options: 78 options in total (55 in dry
Slide 10: Freight Services & Trading: Record Margins in Strong Trading Environment
02. FREIGHT SERVICES & TRADING RECORD MARGINS IN STRONG TRADING ENVIRONMENT RESULT PER VESSEL DAY PROFIT FOR Q2 2022: USD 153 MILLION 3000 2.733 2500 • Significant shift in exposure from dry cargo to product tankers. 2000 USD/day • Record margins, utilising high exposure to exceptionally high MR rat
Slide 11: Business Units Valuation
02. BUSINESS UNITS VALUATION ASSETS & LOGISTICS FREIGHT SERVICES & TRADING Asset trading and active portfolio management of Global freight services and trading in the dry owned and leased vessels. Investments in port cargo and product tanker markets logistics aimed at optimising supply chains NAV-ba
Slide 12: Market Development and Outlook
03. MARKET DEVELOPMENT AND OUTLOOK 12 PRESENTATION OF SECOND QUARTER 2022
Slide 13: Dry and Tanker Market in Q2 2022
03. MARKETS DRY AND TANKER MARKET IN Q2 2022 Weakening dry cargo market Exceptional surge in product tanker market • Rates gradually declined in line with lowered demand amid inflation • Low inventory levels created tight tanker market, further exacerbated and recession fears, with lowered congestio
Slide 14: Market Outlook in Dry Cargo
03. MARKETS MARKET OUTLOOK IN DRY CARGO High uncertainty in dry cargo outlook Low supply growth to temper downturn • Fundamentals indicate weakening • Low orderbook on newbuildings provide cushioning towards • Expected lower demand due to commodity supply constraints, lower rate declines congestion
Slide 15: Market Outlook in Tanker
03. MARKETS MARKET OUTLOOK IN TANKER High spot rates expected to continue for rest of 2022 Low fleet growth supports market • Lower oil demand from higher prices and lower growth, offset by longer • Historically low orderbook of 5% distances and switching of gas-to-oil and coal-to-oil • Limited yard
Slide 16: 2022 Guidance and Sum-up
04. 2022 GUIDANCE AND SUM-UP 16 PRESENTATION OF SECOND QUARTER 2022
Slide 17: 2022 Guidance
04. 2022 GUIDANCE NORDEN guidance for FY 2022 profit for the year: USD 560 to 640 million • Product tanker: High exposure towards substantially increased product tanker rates • Dry cargo: Good short-term positioning towards a weakening dry cargo market, high long-term dry cargo cover at profitable r
Slide 18: Fantastic Second Quarter
04. FINAL WORDS FANTASTIC SECOND QUARTER • Profit of USD 179 million – fantastic group result • Significant shift in market exposure from dry cargo to product tankers • Capitalising on extraordinary margins in product tanker market • Well positioned to capitalise on falling dry cargo rates, while en
Slide 19: Forward Looking Statements
04. FINAL WORDS – DISCLAIMER 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 2022 and subsequent years are subject to uncertainty, and NORDEN’s actual
Slide 20: Thank You for Your Attention
THANK YOU FOR YOUR ATTENTION Dampskibsselskabet NORDEN A/S 52, Strandvejen DK-2900 Hellerup Denmark Phone: +45 3315 0451 www.ds-norden.com Connect with us 20 PRESENTATION OF SECOND QUARTER 2022
Slide 21: Appendix - About NORDEN
APPENDIX - ABOUT NORDEN 21 PRESENTATION OF SECOND QUARTER 2022
Slide 22: Enabling Smarter Global Trade
ENABLING SMARTER GLOBAL TRADE 150 YEARS OF HONOURING OUR COMMITMENTS People & Data Our values Industry leader 376 6.4 ~450 0 Employees Billion datapoints Reliability Flexibility Empathy Ambition Operated vessels Net zero carbon emissions daily 92% chartered / 8% owned by 2050 22 PRESENTATION OF SECO
Slide 23: Market trends: Increased focus on asset-light freight services and logistics
02. NORDEN STRATEGY Market trends: Increased focus on asset-light freight services and logistics Major trends affecting shipping NORDEN strategy Customer centric freight services Market across all continents volatility Digitalisation Optionality upside on leased vessels Geopolitical Tradable assets
Slide 24: Organisational structure: A customer, trading and data-driven NORDEN
Organisational structure: A customer, trading and data-driven NORDEN ASSETS & LOGISTICS FREIGHT SERVICES AND TRADING Asset Management Logistics & Climate solutions Asset-Light Freight Services Dry cargo Product tanker Port logistics Decarbonisation Construction Foods & oils Energy Industrial vessels
Slide 25: NORDEN at a glance
NORDEN at a glance 2008: NORDEN moves into its new 1973: domicile Bryghuset. 2021: NORDEN celebrates 150 The first of 5 dry cargo vessels is years of sailing the seven seas. delivered from Japan, and NORDEN enters what today is 1871: 1923: the core business of the Company. 2013: Mads C. Holm NORDEN’
Slide 26: Five external factors have driven NORDEN's climate strategy
Five external factors have driven NORDEN’s climate strategy Investor demand • Investors seek out sustainable companies as being more Climate crisis successful • The world faces an urgent carbon problem • 3% of carbon emissions are from shipping New regulations • An ambition to stay ahead of environm
Slide 27: Our ambition is to help our customers decarbonise their supply chains
Our ambition is to help our customers decarbonise their supply chains. To do this we will bring them accurate transparency on the carbon footprint of every freight transport, and we will work with our partners to co-create competitive greener shipping solutions Carbon emissions Greener shipping Zero
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