D'amico International Shipping S.a. · MIL:DIS
D'amico International Shipping — Q3 2023 Earnings Presentation
62 slides from D'amico International Shipping's earnings presentation, Nov 9, 2023
Slide 1: Q3 & 9M 2023 Presentation
Q3 & 9M 2023 Presentation d’Amico International Shipping November 9th, 2023
Slide 2: Disclaimer
DISCLAIMER. There shall be no offering or sale of any securities of d’Amico International Shipping S.A. in the United States of America, Switzerland, Canada, Australia, Japan, the United Kingdom or any jurisdiction in which such offer, solicitation or sale would be unlawful prior to its registration
Slide 3: Agenda
AGENDA. ▪ Executive summary ▪ DIS’ overview ▪ Market overview ▪ Why invest in DIS ▪ DIS’ ESG ▪ Appendix
Slide 4: Executive summary
Executive summary. • Net result – In the first 9M’23, d’Amico International Shipping SA (“DIS” or “the Company”) recorded a Net profit of US$ 148.7m vs. a Net profit of US$ 62.8m posted in the first 9M’22. The adjusted net result (excluding non-recurring items) was of US$ 153.0m in the first 9M’23 c
Slide 5: Executive summary
Executive summary. • Dividend distribution – In Mar’23, the Board of Directors of DIS proposed to the Shareholders a dividend to be paid in cash of US$ 22,011,953.96 (US$ 18,710,160.87 net, after deducting the 15% applicable withholding tax), corresponding to US$ 0.0153 net of withholding taxes, per
Slide 6: DIS' overview
L. Veritoo INTERNATIONAL SHIPPING 5.4 . ‘S ES
Slide 7: A modern, high-quality and versatile fleet
A modern, high-quality and versatile fleet. September 30th, 2023 DIS Fleet1 LR1 MR Handy Total % Owned 5.0 15.0 6.0 26.0 72.2% Bareboat chartered 1.0 2.0 0.0 3.0 8.3% Time chartered-in long-term 0.0 3.0 0.0 3.0 8.3% Time chartered-in short-term 0.0 4.0 0.0 4.0 11.1% TOTAL 6.0 24.0 6.0 36.0 100.0% •
Slide 8: Rapidly declining CAPEX commitments
Rapidly declining CAPEX1 commitments. Investment plan US$/mm DIS has no remaining newbuilding CAPEX, 250.0 having fully completed its long-term investment 194.6 plan in ‘19. ‘Vessel acquisition’ in ’22 and in ‘23 200.0 3.9 refer respectively to the exercise of the 164.4 151.1 purchase options on the
Slide 9: Lighter bank debt repayments and low refinancing risk
Lighter bank debt repayments and low refinancing risk. Forecasted bank debt financing cash-flow Daily bank loan repayment on owned vessels (Excluding overdraft facilities)1,2,3 (Excluding overdraft facilities)1,2,3 US$/mm US$/mm US$/mm US$/day 60 6,500 50 40 6,147 40 -- 30 6,000 30 50 20.0 20 20 5,5
Slide 10: DIS' purchase options on leased vessels
DIS’ purchase options on leased vessels. Exercised purchase options: Unexercised purchase options: Build Purch. Option Purch. Vessel Name Build Purch. Option First Ex. Option (In/Out of Date Delivery Date Vessel Name Obligation 7 1 Date First Ex. Date the money) High Priority Mar-05 Feb-21 Date 2 Hi
Slide 11: DIS' purchase options on time-chartered-in vessels
DIS’ purchase options on time-chartered-in vessels Exercised purchase options: Unexercised purchase options: Build Purch. Option Build Purch. Option Purch. Option First Ex. Option (In/Out of Vessel Name Vessel Name Date Delivery Date Date First Ex. Date Last Ex. Date the money) High Adventurer Nov-1
Slide 12: Contracts and modern fleet to drive future results
Contracts and modern fleet to drive future results. Average TC and TC equivalent covered rates1 % of ‘employment days’ US$/day 70% 35,000 • For the last quarter of ’23, DIS has covered ~30% of its 30,555 29,705 28,672 available vessel days at an average TC equivalent rate of US$27.9 thousand. 60% 27
Slide 13: Q4'23 estimated TCE earnings
Q4’23 estimated TCE earnings1. Q4’23 fixed days Q4’23 potential blended TCE TCE US$/day % of ‘fixed days’ TCE US$/day 30,000 66% 70% 30,000 29,500 60% 29,000 29,000 50% 28,000 28,500 40% 33% 33% 27,000 28,000 30% 26,000 27,500 20% 27,000 10% 25,000 27,917 29,820 28,869 25,837 27,546 29,256 26,500 0%
Slide 14: Large potential upside to future earnings
Large potential upside to future earnings. Estimated fleet evolution (avg. n. of vessels)1 Potential upside to earnings2 N. of ships (based on ‘available days’) US$/mm 40 36.0 40 34.1 35 33.0 5.0 0.4 35 3.0 1.6 30 2.7 4.8 30 7.4 2.4 25 25 20 20 15 15 30.7 26.0 26.3 27.4 23.6 10 10 5 5 9.1 10.2 3.3 0
Slide 15: Temporary upward pressure on costs
Temporary upward pressure on costs. Daily operating costs – owned and General & administrative costs – total fleet bareboat vessels1 US$/day US$/m 7,600 20.0 7,400 18.0 16.0 7,200 14.0 7,000 12.0 6,800 10.0 7,458 18.4 6,600 7,280 8.0 6.0 12.1 11.3 6,400 6,732 9.1 9.3 10.2 6,716 6,706 6,718 4.0 6,200
Slide 16: Financial results. First 9M'23 Net financial position
Financial results. First 9M’23 Net financial position (US$ million) Dec. 31st, 2022 Sep. 30th, 2023 Gross debt (496.7) (344.6) IFRS 16 – additional liabilities (39.8) (30.0) Cash and cash equivalents 117.9 105.4 Other current financial assets1 8.8 4.6 Net financial position (NFP) (409.9) (264.6) Net
Slide 17: Financial results. First 9M'23 Results
Financial results. First 9M’23 Results (US$ million) Q3’22 Q3’23 9M’22 9M’23 Non-recurring items: TCE Earnings 94.2 98.3 209.8 301.8 (US$ million) Q3’22 Q3’23 9M’22 9M’23 Total net revenue 95.4 99.5 213.4 305.4 Result on disposal of vessels (0.5) (0.6) (1.6) (4.4) Result on disposal of vessels (0.5)
Slide 18: Financial results. First 9M'23 Key operating measures
Financial results. First 9M’23 Key operating measures Key Operating Q1 2022 Q2 2022 Q3 2022 9M 2022 Q4 2022 FY 2022 Q1 2023 Q2 2023 Q3 2023 9M 2023 Measures Avg. n. of vessels 36.1 35.5 35.3 35.6 36.0 35.7 36.0 36.0 36.0 36.0 Fleet contact 44.5% 39.8% 32.0% 38.8% 19.6% 34.0% 25.2% 27.2% 31.2% 27.9%
Slide 19: Market overview – market fundamentals
Market overview – market fundamentals
Slide 20: Large potential upside to asset values
Large potential upside to asset values. Historical MR TC and spot rates1 Historical MR asset values1 US$/day US$/m 1 YR TC is currently ~15% below the last cycle 50,000 peak, whilst spot rates reached an all-time high 60 NB, 5yr old and 10yr old vessels are 45,000 in Dec’22 and they are currently ~5
Slide 21: Russian refined product exports
Russian refined product exports1. Russia’s Product Exports by Destination Russia’s Product Exports Million barrels per day Million barrels per day 3.5 3.5 3.0 3.0 2.5 2.5 2.0 2.0 1.5 1.5 1.0 1.0 0.5 0.5 0.0 0.0 Sep-23 Aug-21 Sep-21 Aug-22 Sep-22 Aug-23 May-21 Jul-21 May-22 Jul-22 May-23 Jul-23 Jan-2
Slide 22: The Ukrainian war and oil supply
The Ukrainian war and oil supply. World oil production ‘24 average changes Million barrels per day • Due to the pronounced supply cuts by OPEC+ in ‘23, oil output this year barely grew relative to levels reached in Q4 last year. • According to the IEA, a substantial deficit between supply and demand
Slide 23: Oil demand and refining throughputs recovering
Oil demand and refining throughputs recovering. Global oil demand1 Global refinery throughputs1 Million barrels per day Million barrels per day 103.0 102.7 102.6 85.0 84.1 84.0 101.8 84.0 82.9 82.9 102.0 101.6 101.5 83.1 83.0 82.1 82.0 82.1 82.3 81.9 83.4 83.6 81.6 81.8 101.0 100.4 82.0 81.2 82.3 10
Slide 24: Refined product inventories at low levels
Refined product inventories at low levels. Crude oil price (Brent, US$ bbl), forward curve1 CPP vs DPP and crude oil floating storage2 88 Million barrels 87.0 350 87 86.2 325 85.6 300 86 275 85.0 84.5 250 85 225 84.0 83.5 200 84 175 83.1 82.6 150 83 82.2 125 81.8 100 82 81.4 75 50 81 25 0 80 Aug'20
Slide 25: Middle distillate cracks again at high levels
Middle distillate cracks again at high levels Refining cracks, Rotterdam CIF or Barge FOB vs Brent1 80 60 40 20 0 -20 -40 -60 Diesel Crack HSFO 3.5% Crack Jet Fuel Crack Gasoline Crack • Overall refining margins are at very attractive levels: o Following a decline in middle distillate margins from t
Slide 26: Naphtha and Diesel to lead demand growth in '24
Naphtha and Diesel to lead demand growth in ‘24. % Change in number of commercial Jet fuel & Kerosene demand 2021-2023 Global demand growth by product flights vs. 20191 (kbpd) 2 2024 (kbpd) 2 Thousand barrels/day Y-O-Y growth Thousand barrels 10% 8,000 18.5% 20% 17.2% 0% 7,000 18% Naphtha +417 Jul-2
Slide 27: Support also from strong crude tanker market
Support also from strong crude tanker market1. Coated LR2 fleet: clean vs. dirty trading1 Crude tankers’ orderbook % Fleet (dwt)2 100% 1% 1% 1% 0% 0% 0% 0% 0% 45.0% 90% 40.0% 80% 37% 40% 38% 39% 40% 40% 46% 44% 35.0% 70% 30.0% 60% 50% 25.0% 41.0% 40% 20.0% 36.8% 63% 35.7% 30% 60% 62% 61% 60% 60% 31.
Slide 28: Longer-term demand: healthy and resilient growth
Longer-term demand: healthy and resilient growth. World seaborne refined products trade1 Billion Tonne-miles ‘21-’24 CAGR: 7.9% 4,000 ‘00-’19 CAGR: 3.6% 3,500 • Seaborne demand for the transportation of refined products 3,000 contracted sharply in 2020 before 2,500 a strong rebound in 2021, which is
Slide 29: Longer-term demand: changes in the refinery landscape
Longer-term demand: changes in the refinery landscape. Net refinery capacity additions by year ‘23-’261 % of net refinery capacity additions ‘23-’261 Thousand barrels/day 1,500 35.0% 1,300 30.0% 1,100 25.0% 900 20.0% 700 34.3% 15.0% 500 26.3% 10.0% 19.4% 20.5% 300 5.0% 100 6.3% 5.8% 0.0% 2023 2024 2
Slide 30: Longer-term demand: US shale oil
Longer-term demand: US shale oil EIA’s US oil production (mbd)1 US horizontal oil rigs (lhs) vs WTI (US$ bl, rhs)2 14.0 13.4 13.5 13.1 1500 130 13.0 120 13.0 12.8 1300 110 12.5 100 1100 90 12.0 11.7 80 12.1 900 70 11.5 60 700 11.0 50 500 40 10.5 10.9 30 10.0 300 20 9.7 9.9 10 9.5 100 0 Dec-17 Aug-18
Slide 31: Several forces spurring demolition
Several forces spurring demolition. Scrap steel price1 US$/ldt 800 22-Apr-2022, 680 700 10-Oct-2014, 510 600 500 40019-Aug-2011, 445 20-Oct-2023, 540 300 200 17-Jul-2020, 270 04-Mar-2016, 240 100 0 Jun-2013 Jun-2023 Jun-2011 Jun-2012 Jun-2014 Jun-2015 Jun-2016 Jun-2017 Jun-2018 Jun-2019 Jun-2020 Jun
Slide 32: Growing pool of demolition candidates
Growing pool of demolition candidates. Historical and forecasted fleet composition by age (MRs and LR1s) (dwt, as at period end) 60% 53.3% 50% 44.2% 39.8% 40% 34.6% 28.4% 30% 25.0% 20.8% 20% 15.9% 16.0% 12.5% 13.8% 13.5% 11.1% 8.9% 8.4% 9.9% 10.0% 10% 8.1% 5.7% 6.4% 6.2% 7.2% 5.9% 6.2% 6.3% 6.3% 0%
Slide 33: Planned deliveries to slow sharply in coming months
Planned deliveries to slow sharply in coming months. MR & LR1 deliveries, 2022-20231 25 20 N. Of vessels 15 10 20 14 15 5 11 10 11 8 7 8 5 6 0 Q1'23 Q1'24 Q2'23 Q2'24 Q3'23 Q3'24 Q4'23 Q4'24 Estimated deliveries Actual deliveries MR & LR1 demolitions, 2018-20231 20 18 16 N. Of vessels 14 12 10 19 18
Slide 34: Newbuild orders rising but still limited
Newbuild orders rising but still limited. MR newbuilding parity curve vs MR & LR1 orders2 second-hand values1 Period end US$ Million N. of vessels orderbook/fleet ratio 50.048.0 250 70% 45.0 61% 43.5 39.5 60% 40.0 200 35.0 47% 50% 33.0 31.0 30.0 150 40% 25.0 22.4 31% 24.0 30% 20.0 100 21% 15.0 17% 1
Slide 35: Slowing fleet growth
Slowing fleet growth. MR & LR1 deliveries and scrapping (m dwt) (lhs), and net Current MR & LR1 fleet age fleet growth (%)1 (rhs) profile1 39.8% of current fleet Million Dwt 12 11.6%11.9% 12% Million Dwt 11.3% 10 9.7% 10% 9.5% 8.7% 8 8% 60 9.9% of current fleet 6 6% 51.0 6.2% of current fleet 4.6% 4
Slide 36: Why invest in DIS
Why invest in DIS
Slide 37: Historical NAV evolution
Historical NAV evolution. DIS’ Historical NAV evolution1,2,3 US$/m US$/share 1200 12.00 26 34 9.81 9.76 30 1000 947 10.00 8.92 871 7.84 767 7.85 800 7.55 8.00 6.94 7.14 6.27 600 5.58 5.54 6.00 4.88 4.44 4.21 406 3.98 3.86 400 348 3.51 3.56 340 4.00 327 309 286 246 2.75 262 233 23
Slide 38: Why invest in DIS today
Why invest in DIS today. • Young-fleet, most of which acquired at historically attractive prices and at top-tier yards. Furthermore, vessels are mostly eco-design (79% of owned and bareboat ships) and IMO classed (79% of owned and bareboat ships). • First-class in-house technical management provides
Slide 39: DIS' ESG
BA INTERNATIONAL SHI Vy “3
Slide 40: DIS' core values
DIS’ CORE VALUES. Long term vision Guided by the values of family tradition, we build our success on long term planning and turning our promises into actions. Focus onthe environment and safety We do not compromise when it comes to environmental concerns. Care and attention, prudence and respect for
Slide 41: DIS' ESG Key figures
DIS’ ESG Key figures. GOVERNANCE RESPONSIBILITY 2022 Cases of corruption, bribery or anti-competitive behavior 0 Instances for which fines were incurred 0 ENVIRONMENTAL RESPONSIBILITY 2022 EEXI Compliant ships (as at year-end)/ Eco ships 78.6% EEDI - Pre-EEDI (%) (as at year-end) 7.1% EEDI - Phase 1
Slide 42: DIS' ESG – Environment and Safety
DIS’ ESG – Environment and Safety DIS seeks to be an industry leader on environmental and safety issues: • Among the first fleets worldwide compliant with Monitoring Reporting and Verification criteria for CO2 emissions. • Since 2011 DIS has a fleet performance monitoring department to optimize vess
Slide 43: DIS' ESG – Environmental KPIs
DIS’ ESG – Environmental KPIs. CO2 Emissions (owned and bareboat) 2020 2021 2022 Var 2022/21 Var 2022/20 CO2 per nautical mile [tCO2/ Nautical Mile] 0.31127 0.32049 0.30518 -4.8% -2.0% CO2 per transport unit [tCO2/tons] 0.03956 0.03913 0.0384 -1.9% -2.9% AER [g C02/dwt tonne*miles] 6.44 6.16 6.39 3.
Slide 44: DIS' ESG – Corporate Governance
DIS’ ESG – Corporate Governance DIS is listed on the most demanding segment of the Milan stock exchange (the Star), and has therefore adopted a first-class corporate governance framework: • Incorporated in Luxembourg, it is organized and governed in compliance with Luxembourg laws • Listed on the ST
Slide 45: DIS' ESG – Social responsibility
DIS’ ESG – Social responsibility DIS seeks a diverse and inclusive work environment, where team work is highly valued. The high levels of employee satisfaction result in high retention rates. • 24 onshore personnel as at 31 December 2022; • 593 seagoing personnel as at 31 December 2022; • 92% retent
Slide 46: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable DIS’ Sustainable DIS’ Sustainable Sustainability Development Sustainability Development Sustainability Development Topics Goals Topics Goals Topics Goals Vessel energy Integrated Ship recycling efficiency management system for ongoing improvement
Slide 47: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable Activity performed by DIS Sustainability Topics Development Goals Vessel energy efficiency • Renewal of the fleet with “Eco” vessels, in line with IMO directives, thanks to the implementation of innovative technologies. Innovation: • Projects aime
Slide 48: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable Activity performed by DIS Sustainability Topics Development Goals Integrated management • Transparent statement of policies governing operations on board managed ships - in system for ongoing order to ensure safety and efficiency - and of the meth
Slide 49: UN's Sustainable Development Goals
UN’s SUSTAINABLE DEVELOPMENT GOALS. DIS’ Sustainable Activity performed by DIS Sustainability Topics Development Goals Ship recycling • Preparation of hazardous material inventories on all new buildings and on the existing fleet. Stakeholder engagement • Stakeholder mapping and detection of needs an
Slide 50: Appendix
INTERNATIONAL SHIPPING SA
Slide 51: DIS' Shareholdings Structure
DIS’ Shareholdings Structure. Key Information on DIS’ shares 3 1. d'Amico International SA 65.65% 2. Others 31.62% 2 3. d'Amico International Shipping SA 2.73% 100.00% 1 Listing market Borsa Italiana, STAR No. of shares issued 124,106,556 Market capitalisation1 €638.0 million Shares repurchased / %
Slide 52: d'Amico Group Structure
d’Amico Group Structure. 100% d’Amico Società di Navigazione Spa d’Amico International S.A. 100% 100% d’Amico Shipping Ishima Pte Ltd Italia SpA 51% 85% Mida Maritime Rudder S.A.M. Company d.a.c 76.9% 100% Sirius Ship d’Amico Dry d.a.c. Management S.r.l. 65.65% d’Amico International Shipping S.A. 10
Slide 53: DIS' estimated sensitivity to interest rates
DIS’ estimated sensitivity to interest rates1. (US$ million) FY’23 FY’24 FY’25 Estimated average bank debt (285.1) (253.6) (221.7) Estimated average hedged bank debt 123.5 102.2 65.9 Estimated average unhedged bank debt (161.7) (151.3) (155.9) Assumed average cash & equivalents 100.0 100.0 100.0 Est
Slide 54: IMO (MEPC 76): CII and EEXI
IMO (MEPC 76): CII and EEXI. In June 2021, IMO's Marine Environment Protection Committee (MEPC 76) adopted amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI that will require ships to reduce their greenhouse gas emissions. These amendments combin
Slide 55: EU Emission Trading System (ETS) and Fuel EU
EU Emission Trading System (ETS) and Fuel EU. The European Commission has recently published a set of legislative proposals to enable the EU to attain its 2030 target of reducing its greenhouse gas emissions by at least 55% by 2030 compared with 1990 levels. In particular, the EU Commission proposed
Slide 56: Financial results. Consolidated Income Statement
Financial results. Consolidated Income Statement Q3 2023 Q3 2022 9 MONTHS 9 MONTHS US$ Thousand 2023 2022 136,947 136,494 Revenue 407,779 311,774 (38,646) (42,321) Voyage costs (105,984) (101,994) 98,301 94,173 Time charter equivalent earnings 301,795 209,780 1,228 1,213 Bareboat charter revenue 3,6
Slide 57: Financial results. Consolidated Balance Sheet
Financial results. Consolidated Balance Sheet As at As at US$ Thousand 30 September 2023 31 December 2022 ASSETS Property, plant and equipment (PPE) and Right-of-use assets (RoU) 805,288 809,298 Other non-current financial assets 4,944 9,103 Total non-current assets 810,232 818,401 Inventories 15,60
Slide 58: Financial results. Consolidated Cash Flow Statement
Financial results. Consolidated Cash Flow Statement Q3 2023 Q3 2022 9 MONTHS 9 MONTHS US$ Thousand 2023 2022 48,886 43,558 Profit for the period 148,719 62,776 15,869 14,837 Depreciation and amortisation 46,358 45,285 - - Impairment - 2,080 178 159 Current and deferred income tax 775 267 1,485 6,121
Slide 59: DIS' current fleet overview. LR1 & MR Fleet
DIS’CURRENT FLEET OVERVIEW. LR1 & MR Fleet Owned - LR1 Tonnage (dwt) Year Built Builder, Country Interest1 IMO Classified 2 Bright Future 75,000 2019 Hyundai MIPO, South Korea (Vinashin) 100% - Cielo di Cagliari 75,000 2018 Hyundai MIPO, South Korea (Vinashin) 100% - Cielo Rosso 75,000 2018 Hyundai
Slide 60: DIS' current fleet overview. MR Fleet
DIS’CURRENT FLEET OVERVIEW. MR Fleet TC - IN Long Term with purchase option Tonnage (dwt) Year Built Builder, Country Interest1 IMO Classified High Leader 50,000 2018 Japan Marine United Co., Japan 100% IMO II/IMO III High Navigator 50,000 2018 Japan Marine United Co., Japan 100% IMO II/IMO III Crim
Slide 61: DIS' current fleet overview. Handy Fleet
DIS’CURRENT FLEET OVERVIEW. Handy Fleet Owned Tonnage (dwt) Year Built Builder, Country Interest1 IMO Classified Cielo di Salerno 39,043 2016 Hyundai MIPO, South Korea (Vinashin) 100% IMO II/IMO III Cielo di Hanoi 39,043 2016 Hyundai MIPO, South Korea (Vinashin) 100% IMO II/IMO III Cielo di Capri 39
Slide 62: Thank you!
Thank you!
d'Amico International Shipping — Q3 2023 Earnings Presentation on 6ix