Wallenius Wilhelmsen Asa · OSL:WAWI
Wallenius Wilhelmsen Asa — Q1 2024 Earnings Presentation
30 slides from Wallenius Wilhelmsen Asa's earnings presentation, May 8, 2024
Slide 1: Wallenius Wilhelmsen ASA Q1 2024
Wallenius Wilhelmsen ASA Q1 2024
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking information and statements relating to the business, financial performance and results of the Group, and/or the industry and markets in which it operates. Forward-looking statements are statements that are not historical facts and may be identifi
Slide 3: Wallenius Wilhelmsen – Q1 2024
Wallenius Wilhelmsen – Q1 2024 Delivers a Q1 EBITDA of USD 438m, with strong contributions from all segments despite the effect of external events in the Red Sea and Baltimore. Shipping delivers EBITDA of USD 366m (adj. for sales gain), logistics USD 46m, and government USD 34m Sees strong customer
Slide 4: High cash conversion and return on capital employed
The company continues to secure high cash conversion and return on capital employed LTM1 adj. EBITDA LTM Return on Capital Employed3 USDm % +2.1 pp 2.100 +14% 18% 16.6% 1.847 1.750 15% 14.5% 1.625 1.400 12% 1.050 93% LTM 9% cash conversion2 700 6% 350 3% 0 0% Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q1 Q3 Q1 Q3 Q1 Q3 Q
Slide 5: Red Sea avoidance is expected to further tighten tonnage supply
Red Sea avoidance is expected to further tighten tonnage supply 3-month moving average of the number of PCC transits through the Suez Canal 100 • The safety of our people and our vessels remain our top priority 80 • We will continue to divert vessels away from the Red Sea until the security situatio
Slide 6: Committed to become net zero in absolute greenhouse gas emissions by 2040
Committed to become net zero in absolute greenhouse gas emissions by 2040 Target GHG emissions (scope 1 & 2) Historic Negative emissions elsewhere Million tCO2e NZ20401 trajectory • Committed to net zero by 2040 • Updated 2030 target to 40% reduction in greenhouse gas emissions compared to 2022 • Ou
Slide 7: Agenda
Agenda 1. Shipping update 2. Logistics update 3. Sustainability update 4. Financial update 5. Prospects & Q&A 7
Slide 8: Shipping delivered another solid quarter despite lower volumes due to Red Sea
Shipping delivered another solid quarter despite lower volumes due to Red Sea Shipping services volume and cargo mix Estimated net TCE earning/day1 and net freight rate/CBM 38 % +8% +5% 28 % 27 % 25 % 59 57 57 55 56 57 54 55 54 51 53 59 +10% QoQ -2.7 % 45 46 53 55 53 42 43 53 53 -1.9 % -9.7 % 39 39
Slide 9: Flat global car production expected in 2024, offset by increasing ton-miles
Flat global car production expected in 2024, offset by increasing ton-miles due to growing Chinese exports Global production and sales of light vehicles1 Seaborne exports from China split by importing regions2 Million units Million units Production Sales Europe North America Others +9.5% 96 Middle E
Slide 10: H&H volumes are normalizing, allowing us to serve increased auto volumes
H&H volumes are normalizing, allowing us to serve increased auto volumes Global H&H exports adjusted for inflation1 H&H exports - USD bn YoY growth Historical average 75 100% 65 63 60 80% 60 58 58 58 53 52 55 53 • H&H global exports reached a decade high in 2023 51 50 60% 47 44 • Agriculture and Con
Slide 11: Development of orderbook and fleet capacity growth in 2024
Development of orderbook: the growth in fleet capacity in 2024 will be offset by Red Sea impact and growth in Chinese exports Global RoRo fleet development1 Development of the global fleet utilization Million CEU 2023 2024 2025 +3% 6 +7% 100% 102% 101% 0% 3% 10% 11% 10% 5 5% +3% 4 3 113 2 1 1 1 2 0
Slide 12: Contract renewals in 2024 represent 46% of 2023 volumes
Contract renewals in 2024 represent 46% of 2023 volumes 2023 and 2024 contract renewals Year Share of 2023 Share of 2023 Comments volumes revenues Contracts • Announced four contracts with a total value of ~USD 2.6bn over the duration (~3 years) renewed in 25% USD 0.6 bn 2023 • The effect of the 202
Slide 13: Agenda
Agenda 1. Shipping update 2. Logistics update 3. Sustainability update 4. Financial update 5. Prospects & Q&A 13
Slide 14: Baltimore Key Bridge Collapse Update
Baltimore Key Bridge Collapse Update • M/V Carmen departed port on 25 April 2024 • Terminal operations expected to resume early June • Effect on EBITDA estimated at USD 10-12m 14
Slide 15: Logistics services continue to grow
Logistics services continue to grow US Auto and Terminals volumes Revenue & EBITDA margin Million units • Volume increase of 1% from prior 117 122 136 137 146 14% 15% 12% quarter 5.1 4.9 8% 11% Auto 4.8 +3% • Strong revenue offset by increased 3.7 3.7 3.8 SG&A cost US Auto 33 36 37 36 40 • Volume de
Slide 16: An unrivaled US footprint
An unrivaled US footprint 2.4m Cars processed1 110k H&H units processed1 317k Units through WW terminals1 Vehicle Processing Centre Equipment Processing Centre Terminal 1) 2023 volumes 16
Slide 17: Wallenius Wilhelmsen expands Brunswick to become the largest US hub
Wallenius Wilhelmsen expands Brunswick to become the largest terminal and processing hub in the US • The terminal and processing hub will be some 40% larger than the current no 1 in the US • Further strengthens US network of terminals, on-port and in-plant processing centers handling vehicles, const
Slide 18: Agenda
Agenda 1. Shipping update 2. Logistics update 3. Sustainability update 4. Financial update 5. Prospects & Q&A 18
Slide 19: Committed to safe and sustainable operations
Committed to safe and sustainable operations LTIF down, but one fatality in Q1-24 Reduced CO2 intensity YoY, slight increase since last quarter CO2 intensity target Actual CO2 intensity Q4-23 Q1-24 31.2 LTIF Shipping 28.7 per million man-hours 0.44 0.22 exposed 30.4 27.7 28.8 LTIF Logistics per mi
Slide 20: Agenda
Agenda 1. Shipping update 2. Logistics update 3. Sustainability update 4. Financial update 5. Prospects & Q&A 20
Slide 21: Financial highlights - Q1 2024
Financial highlights - Q1 2024 USDm, except per cent and multiples Q4-23 Q1-24 Financial targets * ROCE > 8% Revenue 1 281 1 255 +2.1 16.6% +0.4 Adj. EBITDA 454 438 Equity ratio > 35% Operating 518 402 +4.2 cash flow 46.6% -0.3 Cash 1 705 1 853 Leverage ratio < 3.5x -0.5 Net debt 2 007 1 8
Slide 22: Q1 Segment performance
Q1 Segment performance USDm, unless otherwise noted Revenue Adj. EBITDA1) Comments • A strong quarter with high activity and profitability across all 1 255 1 302 1 311 1 281 1 255 477 478 454 438 398 segments, despite geopolitical and operational challenges Group 32% 37% 36% 35% 35% • Q1 revenues an
Slide 23: EBITDA and revenues down from a very strong previous quarter
EBITDA and revenues down from a very strong previous quarter -26 • Revenue down USD 26m QoQ 9 • Reduced shipping volumes, partly offset by higher net -80 8 3 -4 freight rates 38 USDm 1 281 • Increased fuel surcharges QoQ 1 255 • Stable volumes and revenues in logistics services • Strong activity in
Slide 24: Increasing trend in cash flow per share and solid cash conversion
Increasing trend in cash flow per share and solid cash conversion LTM1 operating cash flow and cash conversion2 LTM Free cash flow to equity per share3 LTM operating cash flow in million USD Cash conversion in % LTM free cash flow to equity per share in USD 115% 2.75 111% 2.58 2.59 2.49 2.36 96% 97%
Slide 25: Cash on hand increased USD 148m in Q1
Cash on hand increased USD 148m in Q1, driven by solid operational performance Comments +9% (18) (15) (3) (22) 21 (55) • USD 402m in operating cash flow (166) 438 1 853 (17) (14) 0 • Q1 cash conversion1 of ~92% 1 705 • Net CAPEX items include investments related to drydock, projects and other tangib
Slide 26: Robust balance sheet and strong liquidity position
Robust balance sheet and strong liquidity position Balance Sheet per end Q1-24 Debt Maturity Profile Comments USD billion USD million • Equity ratio at 46.6% 653 596 • Net debt declines to USD 1.85bn on Assets Equity & 534 185 debt repayments and cash from ops Liabilities 213 466 • New USD 63m debt
Slide 27: Agenda
Agenda 1. Shipping update 2. Logistics update 3. Sustainability update 4. Financial update 5. Prospects & Q&A 27
Slide 28: Prospects
Prospects 2024 market balance: The RoRo shipping market is expected to be tighter in 2024 due to strong growth in auto exports out of Asia and reduced tonnage availability due to the situation in the Red Sea. This is anticipated to more than outweigh lower H&H volumes and the projected fleet growth.
Slide 29: Q&A
Q&A 29
Slide 30: Thank you!
W Wallenius Wilhelmsen Thank you!