D'amico International Shipping S.a. · MIL:DIS
D'amico International Shipping — Q1 2023 Earnings Presentation
63 slides from D'amico International Shipping's earnings presentation, May 11, 2023
Slide 1: Q1 2023 Results Presentation
Q1 2023 Results Presentation d’Amico International Shipping May 11th, 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. • Q1’23 Net result – In Q1’23, d’Amico International Shipping SA (“DIS” or “the Company”) recorded a Net profit of US$ 54.1m, compared with a Net loss of US$ (6.5)m posted in Q1’22. The adjusted net result (excluding non-recurring items) was of US$ 56.5m in Q1’23 compared with US$
Slide 5: Executive summary
Executive summary. • Well positioned to benefit from current strong freight markets, which despite the uncertainties relating to a challenging and unusual economic environment, also because of the war in Ukraine, should represent the beginning of a prolonged and sustainable recovery. • Dividend dist
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. March 31th, 2023 DIS Fleet1 LR1 MR Handy Total % Owned 5.0 10.0 6.0 21.0 58.3% Bareboat chartered 1.0 6.0 0.0 7.0 19.4% Time chartered-in long-term 0.0 5.0 0.0 5.0 14.0% Time chartered-in short-term 0.0 3.0 0.0 3.0 8.3% TOTAL 6.0 24.0 6.0 36.0 100.0% • DIS
Slide 8: Rapidly declining CAPEX commitments
Rapidly declining CAPEX1 commitments. Investment plan US$/mm DIS has no remaining newbuilding CAPEX, 250.0 having fully completed its long-term investment 194.6 plan in ‘19. ‘Vessel acquisition’ in ’22 and in ‘23 200.0 3.9 refer respectively to the exercise of the 164.4 151.1 purchase options on Hig
Slide 9: Lighter bank debt repayments and low refinancing risk
Lighter bank debt repayments and low refinancing risk. Forecasted bank debt financing cash-flow Daily bank loan repayment on owned vessels (Excluding overdraft facilities)1,2,3 (Excluding overdraft facilities)1,2,3 US$/mm US$/mm US$/mm US$/day 50 40 60 6,500 6,147 40 -- 30 30 6,000 20.0 50 20 20 10
Slide 10: DIS' purchase options on leased vessels
DIS’ purchase options on leased vessels. Exercised purchase options: • DIS has flexible purchase options on all its Purch. bareboat chartered-in vessels, allowing it to Build Purch. Option Vessel Name Obligation Purchase option exercised acquire them with three months’ notice Date First Ex. Date Dat
Slide 11: DIS' purchase options on time-chartered-in vessels
DIS’ purchase options on time-chartered-in vessels Build Purch. Option Purch. Option First Ex. Option (In/Out of Vessel Name Date First Ex. Date Last Ex. Date the money) Crimson Jade Jun-17 Jun-21 Dec-26 In the money Crimson Pearl Aug-17 Aug-21 Feb-27 In the money High Adventurer Nov-17 Nov-21 Nov-2
Slide 12: Contracts and modern fleet to drive future results
Contracts and modern fleet to drive future results. Average TC and TC equivalent covered rates1 • Average contract rates rise while the proportion of the fleet % of ‘employment days’ US$/day 70% 35,000 covered falls in FY‘23, providing valuable exposure to an 30,213 30,147 30,610 ongoing market reco
Slide 13: Q2'23 estimated TCE earnings
Q2’23 estimated TCE earnings1. Q2’23 fixed days Q2’23 potential blended TCE TCE US$/day % of ‘fixed days’ TCE US$/day 35,000 80% 71% 32,000 34,000 70% 31,500 33,000 31,000 60% 32,000 30,500 44% 50% 31,000 30,000 40% 29,500 30,000 27% 29,000 30% 29,000 28,500 20% 28,000 28,000 27,000 10% 27,500 29,13
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$/mm 40 40 35.9 34.1 35 33.0 35 5.0 1.9 2.0 30 3.0 2.7 30 7.3 3.2 2.0 25 25 20 20 33.8 32.8 15 15 26.0 26.3 23.6 10 10 17.6 5 5 11.3 10.9
Slide 15: Temporary upward pressure on costs
Temporary upward pressure on costs. Daily operating costs – owned and General & administrative costs – total fleet bareboat vessels1 US$/day US$/m 7,800 4.5 7,600 4.0 7,400 3.5 7,200 3.0 7,000 2.5 6,800 7,697 2.0 4.0 4.2 7,465 3.4 3.4 3.3 3.3 6,600 7,172 7,224 1.5 6,949 6,973 6,400 1.0 6,200 0.5 6,0
Slide 16: Financial results. Q1'23 Net financial position
Financial results. Q1’23 Net financial position (US$ million) Dec. 31st, 2022 Mar. 31st, 2023 Gross debt (496.7) (449.7) IFRS 16 – additional liabilities (39.8) (34.1) Cash and cash equivalents 117.9 155.2 Other current financial assets1 8.8 12.5 Net financial position (NFP) (409.9) (316.1) Net fina
Slide 17: Financial results. Q1'23 Results
Financial results. Q1’23 Results (US$ million) Q1’22 Q1’23 Non-recurring items: TCE Earnings 42.8 106.3 (US$ million) Q1’22 Q1’23 Total net revenue 44.0 107.5 Result on disposal of vessels (0.5) (2.4) Result on disposal of vessels (0.5) (2.4) Non-recurring financial items 0.1 - EBITDA 17.8 76.4 Asse
Slide 18: Financial results. Q1'23 Key operating measures
Financial results. Q1’23 Key operating measures Key Operating Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Q1 2023 Measures Avg. n. of vessels 36.1 35.5 35.3 36.0 35.7 36.0 Fleet contact 44.5% 39.8% 32.0% 19.6% 34.0% 25.2% coverage Daily TCE Spot 12,857 28,687 37,159 42,751 31,758 36,652 (US$/d) Daily TC
Slide 19: Market overview – market fundamentals
Market overview – market fundamentals
Slide 20: Large potential upside to asset values
Large potential upside to asset values. Historical MR TC and spot rates1 Historical MR asset values1 US$/day US$/m 50,000 1 YR TC is currently in line with the last cycle 45,000 peak, whilst spot rates reached an all-time 60 40,000 high in Dec’22. 55 NB, 5yr old and 10yr old vessels are 35,000 50 re
Slide 21: Russian refined product exports
Russian refined product exports1. Russia’s oil product exports Russia’s fuel oil export Thousand barrels per day Thousand barrels per day 1200 2668 3000 180 784 790 2568 2491 2568 1000 2200 2230 2500 160 780 766 140 770 800 2000 120 751 760 749 600 1500 100 741 750 400 1000 80 730 740 60 730 200 500
Slide 22: Russian refined product exports
Russian refined product exports1. Russia’s total oil products exports on water Thousand barrels per day 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 - Jul-20 Jul-21 Jul-22 Jan-20 Jun-20 Nov-20 Dec-20 Jan-21 Jun-21 Nov-21 Dec-21 Jan-22 Jun-22 Nov-22 Dec-22 Jan-23 Aug-20 Sep-20 Oct-20 Aug-2
Slide 23: The Ukrainian war and oil supply
The Ukrainian war and oil supply. World oil production ‘23 average changes Million barrels per day • Russian oil output has proven resilient in ‘22. As sanctions in Europe and the UK come into full force at the end of ‘22, there is however a risk that in ‘23 Russian oil production could be more seve
Slide 24: Oil demand and refining throughputs recovering
Oil demand and refining throughputs recovering. Global oil demand1 Global refinery throughputs1 Million barrels per day Million barrels per day 85.0 84.1 84.3 104.0 103.1 103.0 84.0 83.0 103.0 82.9 82.9 83.1 83.0 82.1 82.2 83.9 82.1 102.0 101.2 81.6 81.4 81.8 82.0 81.2 82.7 100.7 100.7 80.8 81.9 82.
Slide 25: Refined product inventories at low levels
Refined product inventories at low levels. Crude oil price (Brent, US$ bbl), forward curve1 CPP vs DPP and crude oil floating storage2 81 Million barrels 80.1 79.8 80 79.4 350 78.9 325 79 78.5 300 78.0 275 78 77.6 250 77.1 225 76.8 77 76.5 200 76.2 75.9 175 76 150 125 75 100 75 74 50 25 73 0 DPP CPP
Slide 26: Temporary decline in middle distillate cracks
Temporary decline in middle distillate cracks 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 • Middle distillate refining margins have recently declined, partially compensated by an increase in gasoline and f
Slide 27: Jet fuel demand still rising strongly
Jet fuel demand still rising strongly. % Change in number of commercial flights vs. 20191 Jet fuel & Kerosene demand 2020-2023 (kbpd) 2 Thousand barrels/day Y-O-Y growth 10% 8,000 19% 19% 20% 0% 18% Mar-21 May-22 Jan-20 Mar-20 May-20 Jul-20 Jan-21 May-21 Jul-21 Mar-22 Jul-22 Mar-23 Apr-20 Jun-20 Apr
Slide 28: 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% 45.0% 90% 40.0% 80% 37% 40% 38% 39% 38% 46% 44% 35.0% 70% 30.0% 60% 50% 25.0% 41.0% 40% 20.0% 36.8% 63% 62% 35.7% 30% 60% 62% 61% 31.7% 54% 55% 15.
Slide 29: 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: 7.7% 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 30: Longer-term demand: changes in the refinery landscape
Longer-term demand: changes in the refinery landscape. Net refinery capacity additions by year ‘20-’251 % of net refinery capacity additions ‘23-’251 Million barrels/day 3.5 35.0% 3.0 30.0% 2.5 25.0% 2.0 20.0% 34.2% 1.5 15.0% 28.8% 1.0 10.0% 20.5% 0.5 5.0% 11.0% 8.2% 1.4% 0.0 0.0% 2020 2021 2022 202
Slide 31: 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 13.5 13.0 13.0 12.8 12.7 1500 130 120 12.5 1300 110 100 12.0 11.6 1100 90 12.1 80 11.5 900 70 60 11.0 700 50 10.5 10.9 500 40 30 10.0 300 20 9.7 9.9 10 9.5 100 0 Jan-15 Jul-15 Jan-16 Ju
Slide 32: Several forces spurring demolition
Several forces spurring demolition. Scrap steel price1 US$/ldt 800 22-Apr-2022, 680 700 10-Oct-2014, 510 600 500 21-Apr-2023, 555 400 19-Aug-2011, 445 300 200 17-Jul-2020, 270 04-Mar-2016, 240 100 0 Jun-2011 Jun-2012 Jun-2013 Jun-2014 Jun-2015 Jun-2016 Jun-2017 Jun-2018 Jun-2019 Jun-2020 Jun-2021 Ju
Slide 33: Growing pool of demolition candidates
Growing pool of demolition candidates. Historical and forecasted fleet composition by age (MRs and LR1s) (dwt, as at period end) 60% 52.7% 50% 43.3% 40% 36.9% 34.6% 28.4% 30% 25.0% 20.8% 20% 15.9% 16.0% 12.5% 13.8% 13.0% 11.1% 8.9% 8.4% 8.3% 9.3% 10% 8.1% 5.7% 6.4% 6.2% 7.2% 0% 4.2% 5.6% 5.4% 4.9% 5
Slide 34: Planned deliveries to slow sharply in coming months
Planned deliveries to slow sharply in coming months. MR & LR1 deliveries, 2022-20231 30 25 N. Of vessels 20 15 26 10 20 18 18 17 16 16 15 14 5 12 9 10 4 0 Q1'22 Q1'23 Q2'22 Q2'23 Q3'22 Q3'23 Q4'22 Q4'23 MR & LR1 demolitions, 2018-20231 Estimated deliveries Actual deliveries 20 18 N. Of vessels 16 14
Slide 35: Limited newbuild orders
Limited newbuild orders. MR newbuilding parity curve vs MR & LR1 orders2 second-hand values1 Period end US$ Million N. of vessels orderbook/fleet ratio 50.046.5 250 70% 45.0 61% 40.0 42.0 38.4 60% 200 35.0 47% 50% 34.0 30.3 30.0 150 40% 25.0 22.2 31% 24.0 20.0 100 30% 21% 15.0 17% 16% 16% 13% 13% 20
Slide 36: 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 36.9% of current fleet Million Dwt 12 11.6%11.9% 12% 11.3% Million Dwt 10 9.7% 9.5% 10% 8.7% 47.1 8 8% 50 8.3% of current fleet 45 6 6% 4.2% of current fleet 4.6
Slide 37: Why invest in DIS
Why invest in DIS
Slide 38: Historical NAV evolution
Historical NAV evolution. DIS’ Historical NAV evolution1,2,3 US$/m US$/share 1200 1.20 0.98 0.98 1000 1.00 0.89 0.78 809 800 0.76 737 0.80 0.69 0.66 0.60 600 0.56 0.55 0.60 0.51 0.42 0.44 406 0.40 400 348 0.35 0.36 340 0.40 327 0.31 309 286 262 246 233 230 0.28 0.25 0.21 200 0.14 0.16 0.20 0.11 0.11
Slide 39: 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 40: DIS' ESG
BA INTERNATIONAL SHI Vy “3
Slide 41: 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 42: 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 43: 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 44: 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 45: 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 46: 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 47: 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 48: 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 49: 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 50: 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 51: Appendix
INTERNATIONAL SHIPPING SA
Slide 52: DIS' Shareholdings Structure
DIS’ Shareholdings Structure. Key Information on DIS’ shares 3 d'Amico International SA 65.65% Others 32.89% d'Amico International Shipping SA 1.47% 2 100.00% 1 Listing market Borsa Italiana, STAR No. of shares issued 1,241,065,569 Market capitalisation1 €453.1 million Shares repurchased / % of shar
Slide 53: 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 54: DIS' estimated sensitivity to interest rates
DIS’ estimated sensitivity to interest rates. (US$ million) FY’23 FY’24 FY’25 Estimated average bank debt (291.9) (266.4) (233.3) Estimated average hedged bank debt 125.2 86.1 59.8 Estimated average unhedged bank debt (166.7) (180.4) (173.5) Assumed average cash & equivalents 100.0 100.0 100.0 Estim
Slide 55: 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 56: 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 57: Financial results. Consolidated Income Statement
Financial results. Consolidated Income Statement US$ Thousand Q1 2023 Q1 2022 Revenue 140,233 66,538 Voyage costs (33,967) (23,717) Time charter equivalent earnings* 106,266 42,821 Bareboat charter revenue 1,197 1,186 Total net revenue 107,463 44,007 Time charter hire costs (27) (1,206) Other direct
Slide 58: Financial results. Consolidated Balance Sheet
Financial results. Consolidated Balance Sheet As at As at US$ Thousand 31 March 2023 31 December 2022 ASSETS Property, plant and equipment (PPE) and Right-of-use assets (RoU) 797,415 809,298 Other non-current financial assets 4,185 9,103 Total non-current assets 801,600 818,401 Inventories 13,492 18
Slide 59: Financial results. Consolidated Cash Flow Statement
Financial results. Consolidated Cash Flow Statement Q1 2023 Q1 2022 US$ Thousand Result for the period 54,116 (6,496) Depreciation and amortisation PPE and RoU 15,807 15,403 Impairment - 2,080 Current and deferred income tax 277 141 Net lease cost 2,916 3,844 Other net financial charges (income) 3,2
Slide 60: 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 61: 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 High
Slide 62: 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 63: Thank you!
Thank you!
d'Amico International Shipping — Q1 2023 Earnings Presentation on 6ix