Cmb.tech Nv · EURONEXT:CMBT
Cmb.tech Nv — Euronav — Investor Presentation (October 2021)
28 slides from Cmb.tech Nv's investor presentation, October 2021
Slide 1: SEB Sales Presentation
SEB SALES PRESENTATION OCTOBER 2021
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Matters discussed in this presentation may constitute forward-looking statements under U.S. federal securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect the Company’s current views with respect to future events
Slide 3: World's Largest Publicly Listed Tanker Platform
WORLD’S LARGEST PUBLICLY LISTED TANKER PLATFORM Euronav at a glance Diversified and attractive fleet ▪ Diversified fleet of 48 VLCCs1, 30 Type # of vessels Avg. age Built life suezmaxes1, 2 FSOs3 and 2 ULCCs VLCC 48 6.6 yr. 25 yr. ▪ Listed on NYSE and Euronext Brussels 11% with a current market cap
Slide 4: Sector Leadership – Euronav
SECTOR LEADERSHIP – EURONAV Track record in counter cyclical investing 13,900 $/day 4
Slide 5: Contracted Revenue Creates Operational Flexibility
CONTRACTED REVENUE CREATES OPERATIONAL FLEXIBILITY Active Capital Allocation applied last 18 months 13,900 $/day 2 year Liquidity 5
Slide 6: Euronav Investing in Latest Technology for the Energy Transition
EURONAV INVESTING IN LATEST TECHNOLOGY FOR THE ENERGY TRANSITION 8 eco-newbuilds on order Regulatory & commercial landscape demands action now Customer demands on emission compliance 2 2 2 Demand for emission efficient tankers 1 1 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 VLCC Suezmax Da
Slide 7: Current Market Outlook
CURRENT MARKET OUTLOOK © EURONAV.
Slide 8: Outlook: Tanker Market Currently Soft…
OUTLOOK TANKER MARKET CURRENTLY SOFT… 3-6 months Vessel supply Supply of oil Ton miles Demand for oil Oversupply vessels OPEC+ cuts being OECD/High vaccinations Oil demand still below short term tapered leading recovery 2019 peak …SHORT TERM SIGNALS POSITIVE Oversupply of OPEC tapering US imports ri
Slide 9: Oil Supply Set to Increase Medium Term
OIL SUPPLY SET TO INCREASE MEDIUM TERM Return of OPEC barrels in 2H 2021 55,000 55,000 50,000 50,000 K bpd crude production / supply 45,000 45,000 OPEC+ to add OPEC+ 40,000 400k bpd per 40,000 to repeal month from all cuts September by Sept 35,000 2021 until Year 35,000 2022 end 30,000 30,000 25,000
Slide 10: Sustained Production Growth Leads to Improved Tanker Rates Historically
SUSTAINED PRODUCTION GROWTH LEADS TO IMPROVED TANKER RATES HISTORICALLY 60,000 Year 2013 = Q2 13 to Q4 15 +4.5m bpd growth Year 2018 = Q3 17 to Q4 18 +3.8m bpd growth 50,000 Year 2021 = Q2 21 to Q4 22 +7.5m bpd growth 40,000 30,000 20,000 10,000 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -10,
Slide 11: Short Term Surplus Tonnage Improving
SHORT TERM SURPLUS TONNAGE IMPROVING 1 year time charter rate 100,000 11
Slide 12: Switch to Oil from Other Fuel Sources Could Be Around 0.7M bpd
SWITCH TO OIL FROM OTHER FUEL SOURCES FOR ENERGY COULD BE AROUND 0.7M BPD* Equiv USD per bbl expressed in Crude Coal Rotterdam Natural gas US LNG Japan/Korea Brent Crude Low Sulphur * Based US Gasoline 12
Slide 13: Operational Leverage Most Impactful at Euronav
OPERATIONAL LEVERAGE MOST IMPACTFUL AT EURONAV 70% 60% 60% 50% 45% 40% 38% 32% 30% 20% 10% 0% Euronav Tanker co A Tanker co B Tanker co C VLCC 19k/Suez 14k VLCC 34k/Suez 24k VLCC 61k/Suez 40k Source: Clarksons 13
Slide 14: Iran – Wild Card for Tankers?
Vessel supply Supply of oil Ton miles Demand for oil IRAN – WILD CARD FOR TANKERS? Illicit trade 8% VLCC & 5% Suexmax fleet Older tonnage – illicit trade not recycled 70 9 38 40 No of illegitimate vessels 8 % of respective fleet 60 35 2019 2020 7 30 50 30 28 6 25 40 25 23 54 5 30 4 20 15 3 15 20 20
Slide 15: …& Signs of Market Recovery in Asset Prices
…& SIGNS OF MARKET RECOVERY IN ASSET PRICES Asset prices rising on expectation of soon Asset prices tend to be a lead indicator for market recovery time charter rates 120 +25% +14% +14% +21% 80,000 110 103 70,000 100 105 85 60,000 80 100 70 72 63 50,000 60 56 95 49 40,000 43 90 40 30,000 85 20 20,00
Slide 16: ..Onshore & Floating Inventory No Longer an Issue
2500 2600 2700 2800 2900 3000 3100 3200 3300 Source: Clarksons EIA global inventory m bbls 5 Year average NO LONGER AN ISSUE Global OECD inventory below 5 yr average No of vessels floating storage 50 0 100 150 200 250 300 03-Jan-2020 03-Feb-2020 03-Mar-2020 03-Apr-2020 ..ONSHORE & FLOATING INVENTORY
Slide 17: Medium Term Outlook
MEDIUM TERM OUTLOOK 3-6 months Vessel supply Supply of oil Ton miles Demand for oil Oversupply vessels OPEC+ cuts being OECD/High vaccinations Oil demand still below short term tapered leading recovery 2019 peak … BUT SET FOR RECOVERY ✓ Orderbook: ✓ Non-OPEC ✓ Emerging ✓ Peak oil 20y low supply grow
Slide 18: Why Crude Tanker Market So Late Cycle?
WHY CRUDE TANKER MARKET SO LATE CYCLE? BECAUSE HAD TRIPLE HEADWINDS Crude Tanker market impacted in 3 ways since Covid Other Shipping segments recovered to 2019 levels 110 105 Demand reduced by Covid-19 disruption 100 95 90 Supply of cargoes down (crude tanker only) 85 80 75 Jun-2020 Jun-2021 Dec-20
Slide 19: Strong Supply Dynamics with Low Orderbook, Ageing Fleet and Limited Yard Capacity
Vessel supply Supply of oil Ton miles Demand for oil STRONG SUPPLY DYNAMICS WITH LOW ORDERBOOK, AGEING FLEET AND LIMITED YARD CAPACITY Orderbook/fleet ratio Age profile Yard lead times (VLCC) Orderbook % of fleet Avg. age (years) Years 55 11.0 4 Yard lead times Fleet age at 20-year 50 high – 25%+ of
Slide 20: Recycling Candidates for Next 5 Years About 2.8x of Current Orderbook
Vessel supply Supply of oil Ton miles Demand for oil RECYCLING CANDIDATES FOR NEXT 5 YEARS ABOUT 2.8X OF CURRENT ORDERBOOK 25% VLCC fleet > 15 years Average fleet age = 10 years Orderbook 9% Back to level not seen since 2002 80 11 70 10 10 60 Average age of VLCC fleet 9 50 Few >20 year old trading N
Slide 21: Unusual Pattern of Recycling During This Cycle
VLCC recycle price $m 10 15 20 25 30 5 0 Oct-2008 Feb-2009 Jun-2009 Oct-2009 CYCLE Feb-2010 Jun-2010 Oct-2010 Feb-2011 Jun-2011 Oct-2011 Feb-2012 Jun-2012 Oct-2012 Feb-2013 Jun-2013 Oct-2013 Feb-2014 VLCC exits Jun-2014 Oct-2014 Feb-2015 Jun-2015 Oct-2015 Feb-2016 Jun-2016 Oct-2016 Feb-2017 Jun-2017
Slide 22: Recycling - Why Not More Given Rising Steel Prices and Low Freight Rates?
Vessel supply Supply of oil Ton miles Demand for oil RECYCLING - WHY NOT MORE GIVEN RISING STEEL PRICES AND LOW FREIGHT RATES? History: Rates below Breakeven = 5% of fleet recycles Recycling starts when low delta with 15 year old values 35 10 9 9% 30,000 30 8% 8% 8% 8 8% Delta $m VLCC scrap & 15 yea
Slide 23: Peak Oil: Demand Not Supply!
PEAK OIL: DEMAND NOT SUPPLY ! 23
Slide 24: Global VLCC Fleet Ripe for Downsizing
GLOBAL VLCC FLEET RIPE FOR DOWNSIZING 42% OF FLEET >15 YRS BY 2025 Global fleet age highest since 2002; Most aggressive oil demand scenario can be managed by fleet size adjustment 24
Slide 25: History in Cyclical Sectors Never Repeats But Often Rhymes
Vessel supply Supply of oil Ton miles Demand for oil HISTORY IN CYCLICAL SECTORS NEVER REPEATS BUT OFTEN RHYMES 80,000 10 VLCC recycling May 2014 VLCC recycling July 2018 VLCC 1 year TC May 2014 VLCC 1 year TC July 2018 9 70,000 8 60,000 7 50,000 No of VLCC recycled 6 1 year VLCC TC 40,000 5 4 30,00
Slide 26: Sustainability Matters at Euronav… and for Tanker Shipping
SUSTAINABILITY MATTERS AT EURONAV… AND FOR TANKER SHIPPING Alignment with UN Sustainable Development Goals Euronav financing – 1/3 already sustainability linked Euronav total carbon emissions Shipping able to deliver on decarbonisation 2.7% of 4,000,000 Air 425 global CO2 3,800,000 Road 80 emissions
Slide 27: Operational Leverage Most Impactful at Euronav
OPERATIONAL LEVERAGE MOST IMPACTFUL AT EURONAV 70% 60% 60% 50% 45% 40% 38% 32% 30% 20% 10% 0% Euronav Tanker co A Tanker co B Tanker co C VLCC 19k/Suez 14k VLCC 34k/Suez 24k VLCC 61k/Suez 40k Source: Clarksons 27
Slide 28: Thank You
THANK YOU EURONAV.