Genco Shipping & Trading Limited · NYSE:GNK
Genco Shipping & Trading — Q1 2019 Earnings Presentation
27 slides from Genco Shipping & Trading's earnings presentation, May 9, 2019
Slide 1: Genco Shipping & Trading Limited Q1 2019 Earnings Call
Genco Shipping & Trading Limited Q1 2019 Earnings Call May 9th, 2019
Slide 2: Forward Looking Statements
Forward Looking Statements "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements use
Slide 3: Agenda
Agenda First Quarter 2019 and Year-to-Date Highlights Financial Overview Industry Overview 3
Slide 4: First Quarter 2019 and Year-to-Date Highlights
First Quarter 2019 and Year-to-Date Highlights
Slide 5: First Quarter 2019 and YTD Update
First Quarter 2019 and YTD Update Q1 2019 Financials Net loss: $7.8 million ― Basic and diluted loss per share: $0.19 Adjusted net loss: $8.4 million ― Adjusted basic and diluted loss per share: $0.20 (excluding $0.6 million gain on sale of vessels) EBITDA: $17.5 million, ($16.9 million exclud
Slide 6: Genco's Leading Market Position
Genco’s Leading Market Position Significant improvement in margins driven by successful implementation of our commercial platform together with continued cost optimization Q1 2019 Quarterly TCE & DVOE Q2 2019 to date Outperformance >400 TCE fixtures annualized $14,000 Relevant adj Baltic Exchance $1
Slide 7: 2H 2019 & 2020 Drybulk Outlook
2H 2019 & 2020 Drybulk Outlook 2H 2019 fundamentals could improve off of the 1H lows – further improvement is expected in 2020 Drybulk Market Catalysts 2H 2019 & 2020 Supply & Demand Estimates Vessel* 2H 2019 2020 1 2 Iron Ore Coal Trade Linked Iron Ore Trade Capesize to Developing +3.9% +3.3% Growt
Slide 8: Genco's Fleet Directly Aligns with Global Trade Dynamics
Genco’s Fleet Directly Aligns with Global Trade Dynamics Genco’s Capesize exposure provides upside earnings potential while minor bulk fleet provides steady income potential Commodity Percentage of Trade - 2018 Primary Vessel Type Shipping Market Beta Genco Fleet Distribution Genco Cargoes Carried P
Slide 9: We advocate for the effective enforcement of the global sulfur cap
We advocate for the effective enforcement of the global sulfur cap… …as a method to reduce overall air emissions around the world The following initiatives have been undertaken by Genco to reduce Greenhouse Gas (GHG) emissions Established comprehensive IMO 2020 plan to address upcoming environmental
Slide 10: Financial Overview
Financial Overview
Slide 11: First Quarter Earnings
First Quarter Earnings Three Months Ended Three Months Ended March 31, 2019 March 31, 2018 (Dollars in thousands, except share and per share data) (unaudited) INCOME STATEMENT DATA: Revenues: Voyage revenues $ 93,464 $ 76,916 Total revenues 93,464 76,916 Operating expenses: Voyage expenses 43,022 21
Slide 12: March 31, 2019 Balance Sheet
March 31, 2019 Balance Sheet March 31, 2019 December 31, 2018 (Dollars in thousands) (unaudited) BALANCE SHEET DATA: Cash (including restricted cash) $ 192,975 $ 202,761 Current assets 249,763 270,451 Total assets 1,606,170 1,627,470 Current liabilities (excluding current portion of long-term debt)
Slide 13: First Quarter Highlights
First Quarter Highlights Three Months Ended March 31, 2019 March 31, 2018 (unaudited) FLEET DATA: Total number of vessels at end of period 58 60 Average number of vessels (1) 58.3 60.0 Total ownership days for fleet (2) 5,247 5,400 Total chartered-in days (3) 293 - Total available days (4) 5,496 5,3
Slide 14: Key Balance Sheet Items ($ in millions)
Key Balance Sheet Items ($ in millions) Simplified and efficient debt structure offers more flexibility and visibility into Genco’s capital structure – Highlights Genco’s access to high quality commercial bank financing Select Financial Information – Mar 31, 2019 Simplified Debt Structure – Mar 31,
Slide 15: Estimated Q2 2019 Cash Breakeven Rates
Estimated Q2 2019 Cash Breakeven Rates(1) Fleet Breakeven Rates – Estimated Q2 2019 (Detailed Q2 2019 Estimated B/E Rates in Appendix) $15,000 $12,500 Frontloading drydockings ahead of seasonally stronger 2H $ per vessel per day $3,141 $10,000 $1,445 In Q2, we plan to incur one-time $7,500 $2,337 co
Slide 16: Industry Overview
Industry Overview
Slide 17: Market development since the start of 2019
Market development since the start of 2019 Typical first quarter seasonality was exacerbated by Vale incident but near term drivers could support the drybulk market in the months ahead BCI BPI BSI BHSI $18,000 Mtpa impacted 40 30 13 10 30 30 $16,000 Vale dam Suspension Temporary Brucutu mine Brucutu
Slide 18: Major Bulks – Global Steel Production Growth Remains Strong
Major Bulks – Global Steel Production Growth Remains Strong Coal Power Plant Stockpiles(2) Global Steel Production (million tons)(1) 120 45 3 Mos 2019 3 Mos 2018 % Variance China India 40 China 231.1 210.2 9.9% 100 35 European Union 42.3 43.2 -2.0% China Stockpiles (MT) India Stockpiles (MT) Japan 2
Slide 19: Minor Bulks – Steady Grain Trade with Seasonal Impact
Minor Bulks – Steady Grain Trade with Seasonal Impact Seaborne Wheat / Course Grain Trade (MT) Clarksons Global Grain Trade Estimates(1) Exporter 2018 (e) 2019 (f) % Variance Argentina 37 38 1% 400 +3% 2018E 2019F Australia 19 21 10% Canada 24 25 2% 350 EU 33 36 7% 300 US 83 86 4% Others 130 131 1%
Slide 20: The supply response to market conditions
The supply response to market conditions… …has materialized through increased scrapping of older tonnage and slippage of newbuilding deliveries Capesize scrapping has reached its highest …as 4 x VLOCs have exited the market, with point since Jan 2017… possibly others to follow 30,000 8 15 Capes scra
Slide 21: Supply Side Fundamentals
Supply Side Fundamentals Current Drybulk Vessel Orderbook by Type Drybulk Vessel Deliveries vs. Scrapping Capesize Panamax Handymax Handysize (mdwt) (mdwt) Deliveries Scrapping Net Additions Newbuilding orderbook as a percentage of the 20 10 fleet is currently 11% 2.1% Jan 2017 18 8 16 Jan 2018 14 1
Slide 22: Q&A
Q&A
Slide 23: Appendix
Appendix
Slide 24: Genco Fleet List
Genco Fleet List Major Bulk Minor Bulk Capesize Vessel Name Year Built Dwt Vessel Name Year Built Dwt Vessel Name Year Built Dwt Capesize Ultramax Baltic Cougar 2009 53,432 17 Genco Resolute 2015 181,060 Baltic Hornet 2014 63,574 Genco Loire 2009 53,430 Genco Endeavour 2015 181,060 Baltic Mantis 201
Slide 25: Time Charter Equivalent Reconciliation
Time Charter Equivalent Reconciliation(1) Three Months Ended March 31, 2019 March 31, 2018 (unaudited) Total Fleet Voyage revenues (in thousands) $ 93,464 $ 76,916 Voyage expenses (in thousands) 43,022 21,093 Charter hire expenses (in thousands) 2,419 - 48,023 55,823 Total available days for owned f
Slide 26: Adjusted Net Loss Reconciliation
Adjusted Net Loss Reconciliation Three Months Ended March 31, 2019 Adjusted Net Loss Reconciliation (unaudited) Net loss $ (7,801) - Gain on sale of vessels (611) Adjusted net loss $ (8,412) Adjusted net loss per share - basic $ (0.20) Adjusted net loss per share - diluted $ (0.20) Weighted average
Slide 27: Q2 2019 Genco Estimated Breakeven Rates
Q2 2019 Genco Estimated Breakeven Rates (1) Daily Expenses by Category Free Cash Flow(2) Net Income Direct Vessel Operating(3) $4,525 $4,525 General and Administrative 1,102 1,183 Expenses(4) Technical Management Fees(5) 357 357 Drydocking(6) 2,337 - Interest Expense(7) 1,445 1,625 Fixed Debt Repaym
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