Genco Shipping & Trading Limited · NYSE:GNK
Genco Shipping & Trading — Merrill Lynch Global Transportation Conference 2008
29 slides from Genco Shipping & Trading's conference presentation, Jun 18, 2008
Slide 1: Genco Shipping & Trading Limited - Merrill Lynch Global Transportation
Genco Shipping & Trading Limited Merrill Lynch Global Transportation June 18, 2008
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. These forward looking statements ar
Slide 3: Summary
Summary Issuer Genco Shipping & Trading Limited Ticker / Exchange GNK / NYSE Date of Initial Public Offering July 22, 2005 Target Dividend $1.00 per share, per quarter Shares Outstanding 31.78 Million Annualized Dividend Yield (as of June 17, 2008) 12.6% Pro Forma Net Debt to Total Cap(1) 54% Cantor
Slide 4: Management
Management Peter Georgiopoulos Gerry Buchanan John C. Wobensmith Chairman President Chief Financial Officer Over 20 years of Over 40 years of 15 years of experience in experience in the shipping experience in the shipping the shipping industry industry industry Formerly Senior Vice Chairma
Slide 5: Genco Overview
Genco Overview Founded in December 2004, completed IPO in July 2005 High quality, modern fleet of 28 vessels ― Expected delivery of 13 additional vessels through the fourth quarter of 2009 Ideally positioned to take advantage of a strong market to renew time charters ― Consistent 75% coverage
Slide 6: Execution of Growth Strategy
Execution of Growth Strategy Genco Muse acquisition in August Evalend 6 vessel acquisition in 2005 - $34.5 million August 2007 - $336.0 million Franco 3 vessel acquisition in July Bocimar 3 vessel acquisition in May 2006 - $81.3 million 2008 - $257.0 million Metrostar 9 vessel acquisition
Slide 7: Current Fleet
Current Fleet * Daily Cash Adjusted Daily Vessel Type Vessel Name Year Built Charterer Charter Expiration (3) Rate (1) Revenue Rate (2) Genco Augustus 2007 Cargill International S.A. 45,263 62,750 December, 2009 Genco Tiberius 2007 Cargill International S.A. 45,263 62,750 January, 2010 Capesize Genc
Slide 8: Footnotes to Fleet Table (previous page)
Footnotes to Fleet Table (previous page) (1) Time charter rates presented are the gross daily charterhire rates before the payments of brokerage commissions ranging from 1.25% to 6.25% to third parties, except as indicated for the Genco Leader in note 6 below. In a time charter, the charterer is res
Slide 9: Acquisition Vessels to be Delivered
Acquisition Vessels to be Delivered Adjusted Daily Vessel Year Duration/ Daily Vessel Name DWT Yard Delivery(1) Charterer Cash Type Built(1) Expiration Revenue Rate Rate (2) Capesize 2008 Cargill 46 to 62 months 65,000(3) Genco Hadrian 170,500 Sungdong Q4 2008 International S.A. from delivery Genco
Slide 10: Financial Overview
Financial Overview
Slide 11: Strong Balance Sheet
Strong Balance Sheet Selected Financial Information Pro Forma 3/31/08 (Dollars in thousands) Balance Sheet Liquidity Position Cash(1) $19,217 Revolving Credit Facility $1,377,000 Debt(2) $911,050 Drawn Portion (911,050) Shareholders’ Equity(3) 788,675 Undrawn Portion $465,950 Capitalization $1,699,7
Slide 12: Acquisition Vessel Payment Schedule
Acquisition Vessel Payment Schedule (Dollars in thousands) Deposit as % Expected Deposit Payment on Total Vessel Name of Purchase Delivery (1) Payment (2) Delivery Price Price Metrostar Acquisition Vessels Genco Hadrian Q4 2008 20% $ 24,200 $ 96,800 $ 121,000 Genco Commodus Q2 2009 20% 24,200 96,800
Slide 13: Revolving Credit Facility Structure
Revolving Credit Facility Structure Credit Facility Up to $1.377 billion Have entered into nine Term 10 Years forward interest rate swaps ― Total amount swapped Non-Amortization for 2008 of $681.2 mm 5 Years Period ― Average swapped rate Interest Rate LIBOR + 0.85%(1) of approximately 4.8% for 200
Slide 14: Dividend Declaration & Policy
Dividend Declaration & Policy Disciplined DisciplinedAsset AssetGrowth Growth Paid a Q1 2008 dividend of $1.00 and andT/C T/CStrategy Strategy per share payable on May 30th, 2008 to all shareholders of Period Declared Dividend record as of May 16th, 2008 Q3 2005 $0.60 Cash reserves are determine
Slide 15: Growth Strategy: Timing Is Everything
Growth Strategy: Timing Is Everything Opportunistic and prudent acquisition strategy ― Accretive earnings and cash flows while maintaining a disciplined approach to return on capital Pursue Accretive Revolver is primary driver of growth strategy Acquisitions ― Accretive to shareholders and reduc
Slide 16: Significant Opportunities in Fragmented Industry
Significant Opportunities in Fragmented Industry No single owner owns more than 7% of the vessels within each class Market capitalization for all U.S.-listed pure drybulk owners is approximately $15 billion (1) Drybulk industry has similarities to the tanker industry in 1999 Ownership 100.0% 8
Slide 17: Industry Overview
Industry Overview
Slide 18: Drybulk Indices
W ee 0 5,000 10,000 15,000 20,000 25,000 k W 1 ee k W 3 ee k W 5 ee k W 7 ee W k9 Source: Clarkson’s ee (BCI Points) k W 11 ee k W 13 ee k W 15 ee k W 17 ee k W 19 ee k W 21 ee k W 23 ee k W W 25 ee k 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 ee k W 1 W 27 ee ee k k W 3 Drybulk Indices W 29 ee
Slide 19: Major Drybulk Trade Routes
Major Drybulk Trade Routes Iron Ore Coal Source: Drewry Grains 19
Slide 20: Demand Side Fundamentals
Demand Side Fundamentals Australian miners attempting to negotiate a freight premium before settling on the 2008 iron ore contract price Increased ton mile demand due to stronger Brazilian trade Higher coal shipments out of US further increase ton miles Increased coal demand expected due to
Slide 21: Commodity Volume Expansion
Commodity Volume Expansion Chinese fixed asset investment rise of 25.6% through May 2008 Chinese industrial production grows 16% in May 2008 Ongoing Asian investments in Brazilian and Australian mining companies Iron ore production of approximately 600 Mt in 2007 ― Potential to grow to 1,110
Slide 22: Supply Side Fundamentals
Supply Side Fundamentals 23% of Capesize orders for 2009 delivery and 33% of orders for 2010 being constructed at Greenfield yards(1) Credit crunch poses threat to new yards Newbuilding delivery delays possible due to engine, crane and other part shortages Rising cost of steel has made some
Slide 23: Conclusions
Conclusions
Slide 24: Key Investment Highlights
Key Investment Highlights Modern high-quality fleet with contracted growth U.S.-based management team with strong track record Dividend policy supported by time charters Strong growth with dividends to Cost efficient operations shareholders Attractive revolving credit facility Favorable industry fun
Slide 25: Appendix
Appendix
Slide 26: Pro Forma Reconciliation 03/31/08
Pro Forma Reconciliation 03/31/08 (Dollars in thousands) 03/31/08 Actual Adjustment 03/31/08 Pro Forma Cash(1) $48,295 ($29,078) $19,217 Debt $1,014,500 (103,450) $911,050 Shareholders’ Equity(2) 622,346 166,329 788,675 Capitalization $1,636,846 - $1,699,725 (1) March 31, 2008 pro forma cash takes i
Slide 27: Year to Date Earnings
Year to Date Earnings Three Months Ended March 31, 2008 March 31, 2007 (Dollars in thousands, except share and per share data) (unaudited) INCOME STATEMENT DATA: Revenues $ 91,669 $ 37,220 Operating expenses: Voyage expenses 744 1,413 Vessel operating expenses 10,919 6,389 General and administrative
Slide 28: March 31, 2008 Balance Sheet
March 31, 2008 Balance Sheet March 31, 2008 December 31, 2007 (Dollars in thousands) (unaudited) BALANCE SHEET DATA: Cash $ 48,295 $ 71,496 Current assets, including cash 221,803 Dwt 267,594 Total assets 1,746,773 1,653,272 Current liabilities, including current portion of long-term debt 24,788 70,3
Slide 29: 1st Quarter Highlights
1st Quarter Highlights Three Months Ended March 31, 2008 March 31, 2007 (unaudited) FLEET DATA: Total number of vessels at end of period 28 19 Average number of vessels (1) 28.0 19.6 Total ownership days for fleet (2) 2,552 1,762 Total available days for fleet (3) 2,533 1,731 Total operating days fo
Genco Shipping & Trading — Merrill Lynch Global Transportation Conference 2008 on 6ix