Dampskibsselskabet Norden A/s · OMXCOP:DNORD
Dampskibsselskabet Norden A/s — Norden — Q1 2017 Earnings Presentation
31 slides from Dampskibsselskabet Norden A/s's earnings presentation, May 3, 2017
Slide 1: NORDEN Results First Quarter of 2017
NORDEN RESULTS First quarter of 2017 Copenhagen, Denmark 3 May 2017 NORDEN – FIRST QUARTER 2017| 1 Custodians of smarter global trade
Slide 2: Agenda
AGENDA Group highlights Financials Dry Cargo Tankers 2017 expectations Q&A NORDEN – FIRST QUARTER 2017| 2 Custodians of smarter global trade
Slide 3: Q1 Highlights
Q1 HIGHLIGHTS Adjusted result for Q1 USD 1 mill. Strong performance by Tanker business in challenging markets Surprisingly strong dry cargo market, but due to 100% coverage NORDEN did not fully benefit Increase in asset values Increasing forward rates benefitting more than 62,000 open days in Dry Ca
Slide 4: Strong Tanker Result – Full Effect of Dry Market Improvement Not Seen in Q1
FINANCIALS STRONG TANKER RESULT – FULL EFFECT OF DRY MARKET IMPROVEMENT NOT SEEN IN Q1 Adjusted result – Dry Cargo Adjusted result – Tankers 0 16 15 14 -5 12 10 10 7 USD million USD million 8 -10 -8 -9 6 -11 4 -15 -13 2 0 -20 -2 -20 -1 -4 -4 -25 -6 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q1 2016 Q2
Slide 5: Balanced Capital Structure
FINANCIALS BALANCED CAPITAL STRUCTURE Equity share of 46%, which is considered an appropriate capital structure Net commitments increased by USD 94 million due to increase in T/C obligations Combined undrawn credit facilities, cash and securities at USD 514 million USD 237 in outstanding yard paymen
Slide 6: Asset Values Increase
ASSET VALUES ASSET VALUES INCREASE Upward pressure on asset values for Dry Cargo Tankers asset values were flat during Q1, but increased end of quarter Value of owned fleet is 58/42 split between Dry Cargo and Tankers More than 62,000 open vessel days in Dry Cargo (2017-2021) 5-year secondhand price
Slide 7: Dry Cargo: Surprisingly Strong Market in Q1
DRY CARGO SURPRISINGLY STRONG MARKET IN Q1 Supramax: average market rates 115% higher than Q1 2016 Panamax: average market rates 170% higher than Q1 2016 Strong Chinese activity contributed to demand growth Iron ore imports increased by 12% Chinese coal imports increased by 33% Limited growth in Res
Slide 8: Low Supply Growth Supporting Long Term Outlook
DRY CARGO LOW SUPPLY GROWTH SUPPORTING LONG TERM OUTLOOK 2017 demand outlook still highly dependent on political influence Chinese governmental stimulus continues to support economic activity However, the Chinese governmental influence could reverse coal import trend Limited ordering activity New or
Slide 9: Tankers: Continued Challenging Market Conditions
TANKERS CONTINUED CHALLENGING MARKET CONDITIONS Significant local spikes in otherwise poor market Adverse weather conditions creating delays and congestions Strong gasoline pull from Latin America and West Africa The global tanker fleet continued to expand with steady deliveries and only few scrappi
Slide 10: Foundation for Improvements in 2018
TANKERS FOUNDATION FOR IMPROVEMENTS IN 2018 Oil demand at similar levels as last year, but boost in economic optimism could lead to higher oil consumption Declining but still high level of inventories Excessive supply growth in 2017, but limited orderbook creating foundation for improvements in 2018
Slide 11: NORDEN Maintains Expectations for 2017
2017 FULL YEAR GUIDANCE NORDEN MAINTAINS EXPECTATIONS FOR 2017 Outlook Comments USDm Dry Cargo Tankers Total Adjusted net result USD -20 to 40 million Corresponds to EBIT of USD -5 to Adjusted 55 million results for -15 to 45 -15 to 15 -20 to 40 the year Weak Q1 Dry cargo results despite strong spot
Slide 12: 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 2017 and subsequent years are subject to uncertainty, and NORDEN’s actual results may therefore differ from the p
Slide 13: 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 14: Back Up Slides
FORWARD BACK UP SLIDES LOOKING STATEMENTS NORDEN – FIRST QUARTER 2017| 14 Custodians of smarter global trade
Slide 15: Continuously Outperforming the Markets
PERFORMANCE CONTINUOUSLY OUTPERFORMING THE MARKETS Tankers - 4 quarter rolling NORDEN TCE over benchmark 6,000 5,000 4,000 3,000 2,000 1,000 0 -1,000 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Handy MR Dry Cargo - 4 quarter rolling NORDEN TCE over benchmark 5,000 4,000 3
Slide 16: What Makes NORDEN Different?
WHAT MAKES NORDEN DIFFERENT? 2 Segments - focus on vessel types where we can make a difference Dry Cargo Tankers Full scale operational setup - Direct customer contact Portfolio of time charter-in contracts and earnings coverage Long track record of overperformance in Dry Cargo and Tankers Healthy b
Slide 17: A Leading Global Tramp Operator
A LEADING GLOBAL TRAMP OPERATOR 76 DRY CARGO VESSELS (CORE FLEET) PANAMAX (24.5) SUPRAMAX (29.5) CAPESIZE (1) POST-PANAMAX (4) HANDYSIZE (17) Modern fleet Global network of offices and port captains Pools in Dry cargo (Handysize & Post-Panamax) and Tankers (MR & Handysize) Tankers MR (25) HANDYSIZE
Slide 18: 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 Offices in Singapore, Number of active vessels 1875-76 200 Anna
Slide 19: 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- Owned (36.5
Slide 20: 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 21: Overall Results
OVERALL RESULTS USD million Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 EBITDA - Dry Cargo -12.5 -4.5 -1.9 -4.0 -6.3 EBITDA - Tankers 23.9 16.7 6.0 8.0 16.6 EBITDA - Group 11.4 12.2 4.1 2.9 10.3 Depreciation -13.3 -13.8 -11.6 -10.8 -10.6 EBIT Group -1.3 -34 -12.9 -16.3 0.1 Result for the period 4.6 -24
Slide 22: Newbuilding Prices
Million USD 0 10 20 30 40 50 60 1976-Jan Source: Clarksons 1978-Jan 1980-Jan 1982-Jan Panamax (Dry) 1984-Jan 1986-Jan NORDEN – FIRST QUARTER 2017| 22 1988-Jan 1990-Jan 1992-Jan 1994-Jan 1996-Jan 1998-Jan NEWBUILDING PRICES 2000-Jan 2002-Jan 2004-Jan 2006-Jan 2008-Jan 2010-Jan 2012-Jan 2014-Jan 2016-
Slide 23: Classic TCE Dry Cargo
CLASSIC TCE DRY CARGO Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Fleet days 90 167 91 92 92 Capesize TCE 10,411 -694 3,106 6,774 12,231 Fleet days 567 778 747 658 397 Post-Panamax TCE 8,492 4,881 4,709 7,731 8,465 Fleet days 8,755 5,873 7,433 7,405 7,806 Panamax TCE 7,612 5,325 6,353 6,918 7,824 Fleet
Slide 24: Financial Strength
FINANCIAL STRENGTH Capital structure Net committed cash (ultimo) Cash in low-risk deposit accounts and USDm Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016 securities Adjusted net interest 12 12 6 -24 18 Outstanding yard payments (incl. joint bearing assets* ventures (50%)) T/C obligations** -1,202 -1,143 -
Slide 25: Fleet Values
FLEET VALUES Fleet values at 31 Marts 2017 USD ’000 Broker estimated value of owned Broker estimated value of Added Number Average dwt. Carrying amount/cost vessels* charter party value Dry Cargo Panamax 5.0 62,000 90 79 17 6 Supramax 14.5 56,000 312 311 0 -1 Handysize 8.0 37,000 110 100 15 4 Total
Slide 26: Dry Cargo Fleet Overview
DRY CARGO FLEET OVERVIEW NORDEN’s Dry Cargo fleet and values at 31 March 2017 Vessel type Capesize Post-Panamax Panamax Supramax Handysize Total Vessels in operation Owned vessels 0.0 0.0 4.0 5.5 8.0 17.5 Chartered vessels with a duration of more than 13 months 1.0 4.0 20.5 24.0 9.0 58.5 Total activ
Slide 27: Product Tanker Fleet Overview
PRODUCT TANKER FLEET OVERVIEW NORDEN’s Tanker fleet and values at 31 March 2017 Vessel type LR1 MR Handysize Total Vessels in operation Owned vessels 0 9 10 19 Chartered vessels with a duration of more than 13 months 0 13 0 13 Total active core fleet 0 22 10 32 Chartered vessels with a duration of l
Slide 28: Dry Cargo Capacity
DRY CARGO CAPACITY Capacity and coverage, Dry Cargo, at 31 March 2017 Q2 2017 Q3 2017 Q4 2017 2018 2019 Q2 2017 Q3 2017 Q4 2017 2018 2019 Own Vessels Ship days Panamax 361 364 366 1,446 1,373 Supramax 498 493 503 2,743 4,002 Handysize 594 615 643 2,534 2,534 Total 1,453 1,471 1,512 6,722 7,909 Chart
Slide 29: Dry Cargo Coverage
DRY CARGO COVERAGE Coverage Revenue from coverage (USD per day) Capesize - - - - - - - - - - Post-Panamax 194 79 67 78 - 11,028 9,296 9,366 8,529 - Panamax 5,490 3,392 1,534 3,331 2,810 8,795 10,117 11,531 14,053 14,870 Supramax 4,206 1,856 1,540 2,728 1,989 9,469 8,558 7,988 10,397 11,769 Handysize
Slide 30: Tankers
TANKERS Capacity and coverage, Tanker, at 31 March 2017 Q2 2017 Q3 2017 Q4 2017 2018 2019 Q2 2017 Q3 2017 Q4 2017 2018 2019 Own Vessels Ship days LR1 - - - - - MR 804 814 823 3,204 3,247 Handysize 892 898 917 3,591 3,588 Total 1,696 1,712 1,740 6,795 6,835 Chartered vessels Costs for T/C core capaci
Slide 31: 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/S M