Ocean Yield ASA — Q1 2017 Earnings Presentation
20 slides from Ocean Yield ASA's earnings presentation, May 9, 2017
Slide 1: Presentation Q1 2017
Presentation Q1 2017 9th May 2017
Slide 2: First Quarter 2017 financial highlights
First Quarter 2017 financial highlights Quarterly dividend increased to USD 0.1850 per share – Increase of 0.25 cents vs. Q4 – 5% increase annualized – USD 0.74 per share annualized – Dividend yield of 9.9% p.a. – 14th consecutive quarterly dividend increase EBITDA was USD 71.2m vs. USD 74.4m in Q4
Slide 3: Recent events
Recent events Successful delivery of two newbuilding container vessels – MSC Rifaya and MSC Leanne Termination of charter contract for Lewek Connector – Entered into a new 4 months bareboat contract at a rate of USD 40,000 /d – Expect reduced earnings after cancellation of bareboat contract – Vessel
Slide 4: Recent events (cont.)
Recent events (cont.) Agreement with Farstad to restructure two bareboat charters – Charter rates for the next 5 years reduced to NOK 99,400 /d – Charter rates increases to NOK 209,300 /d in 2022 and 2023 – Balloon payment of NOK 128m in 2023 with potential earlier prepayments based on cash sweep –
Slide 5: New transactions
New transactions Shipping- and offshore markets – Most shipping and offshore segments show signs of having levelled out after a period of decreasing asset values – Low asset values should make 2017 an attractive timing for new investments Market for sale & leaseback transactions – Increased activity
Slide 6: Charter backlog by client end of Q1 2017
Charter backlog by client end of Q1 2017 EBITDA* backlog of USD 2.8 billion 12 % Major European container line 26 % 4% 6% Avg. remaining 6% charter tenor of 3% 11.4 years 9% 13 % 14 % 7% *EBITDA backlog based on management’s estimates on DB-1, certain options not being exercised, LIBOR forward curve
Slide 7: Fleet overview per Q1 2017
Fleet overview per Q1 2017 Chemical tankers 10 Container vessels1 6 Car carriers 6 Product tankers 4 Subsea construction 2 3 Gas carriers 1 1 Offshore supply 2 # Delivered FPSO 1 # To be delivered 1) 49.5% ownership in six container vessels and 2) 75.0% ownership in SBM Installer May 17 First Quarte
Slide 8: Quarterly EBITDA and net profit
Quarterly EBITDA and net profit EBITDA per quarter (USDm) 74.4 71.2 68.7 63.4 58.7 55.4 54.2 53.9 55.2 56.0 56.4 56.6 53.2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 0217 Net profit per quarter (USDm) 36.8 32.7 30.5 28.6 28.1 28.3 24.5 25.8 25.5 22.7 17.1 18.6 0.7 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 9: Adjusted EBITDA and net profit
Adjusted EBITDA and net profit EBITDA adjusted for finance lease effects (USDm) 82.8 79.1 75.6 69.3 63.6 55.4 55.1 57.3 58.4 59.6 59.8 53.2 54.2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 2017 Adjusted net profit (USDm) 36.9 33.4 33.4 31.6 27.4 26.8 27.1 28.0 27.6 29.0 25.6 26.3 26.2 Q1 Q
Slide 10: Growth in cash dividends for 14 consecutive quarters
Growth in cash dividends for 14 consecutive quarters Dividend yield Adjusted earnings per share (USD cents)1 24.66 9.9%2 p.a. 23.94 23.21 22.34 21.28 20.17 19.73 19.86 20.55 20.25 19.10 19.60 19.54 Pay-out ratio on adjusted Q1 EPS Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 0217 83% Divide
Slide 11: Profit & loss
Profit & loss Income statement Comments Q4 Q1 Amounts in USD million 2016 2017 Revenues Operating revenues 61.2 57.2 Revenues from Lewek Connector Finance lease revenue 15.8 16.1 reduced by USD 4.0m Income from investment in associates 4.9 5.3 Full quarter earnings from Total revenues and other inco
Slide 12: Adjusted net profit
Adjusted net profit Adjustments Comments Q4 Q1 Amounts in USD million 2016 2017 Net profit 0.7 36.8 - Impairment charges 36.2 - • Largely related to the vessel Lewek Connector - Gain on AMSC bonds - (5.7) - Cancellations/repayment of loans 0.9 0.1 • Related to Aker ASA / Hartmann facility - Foreign
Slide 13: Balance sheet
Balance sheet Balance sheet Q4 Q1 Q4 Q1 ASSETS (USDm) 2016 2017 EQUITY AND LIABILITIES (USDm) 2016 2017 Goodwill 9.8 9.8 Equity to holders of the parent 804.2 813.5 Vessels and equipment 1,243.8 1,228.6 Non-controlling interests* 11.0 11.3 Investments in associates 187.4 186.6 Total equity 815.2 824
Slide 14: Update on bank loans
Update on bank loans Dhirubhai-1 loan facility amendment – Prepaid USD 37.8m (cash management reasons) down to USD 30m – Three quarterly instalments of USD 10m with first instalment in Q1’18 – USD 20.0m in restricted cash has been released in Q2’18 – Substantial free cash flow from vessel going forw
Slide 15: Financing of newbuilding program
Financing of newbuilding program Contractual obligations and financing (USDm) Gas carrier Already paid 32.4 Remaining payments in 2017 48.6 Total contractual obligations 81.0 Total remaining payments 48.6 Secured bank financing 67.5 Estimated surplus cash 18.9 Comments • Contractual obligations rela
Slide 16: Strong liquidity position
Strong liquidity position Cash and securities available for sale per Q1’17 (USD million) 264 51 213 117 96 Cash Available Total available Bonds in AMSC Total available drawing facilities cash liquidity Comments • Restricted cash of USD 20 million has been released in Q2’17 May 17 First Quarter 2017
Slide 17: Outlook
Outlook New investments – Available liquidity of USD 264 million and book equity ratio of 35% gives substantial investment capacity – Low asset values should make 2017 an attractive timing for new investments – Increased activity and improved deal pipeline – Expanding deal origination team 2017 earn
Slide 18: First Quarter 2017
= OCEAN YIELD First Quarter 2017
Slide 19: First Quarter 2017
= OCEAN YIELD First Quarter 2017
Slide 20: May 17
= OCEAN YIELD — May 17 20