Dfds A/s · OMXCOP:DFDS
Dfds A/s — Q3 2008 Earnings Presentation
18 slides from Dfds A/s's earnings presentation, Nov 26, 2008
Slide 1: Q3 Report 2008
Q3 REPORT 2008 26 November 2008
Slide 2: Q3 in line with expectations
Q3 IN LINE WITH EXPECTATIONS Group EBITDA, Q3 • Q3 EBITDA in line with expectations but reduced by 17% to DKK 394 mill. compared to 2007 500 400 DKK mill. • Q3 performance & market trends: 300 • Impact from slow down beginning to appear on North Sea freight market 200 • Baltic Sea operations perform
Slide 3: Restructuring & adjustment of activities
RESTRUCTURING & ADJUSTMENT OF ACTIVITIES Group EBITDA, Q1-3 1.200 • Q4 profit expected to be impacted by: • Decreasing volumes across markets 1.000 DKK mill. • Pressure on freight and pax yields 800 • Negative impact from exchange rate changes 600 • Positive impact from lower oil price 400 • Consequ
Slide 4: Business area performance
BUSINESS AREA PERFORMANCE EBITDA per business area, Q1-3 800 Figures in DKK million • Ro-Ro Shipping: More pressure on volumes in Q3. ∆ -102 700 Turnover flat adjusted for BAF. Increase in tonnage cost (-50) & bunker cost adjusted for BAF (-20) 600 • Container Shipping: Industrial logistics performi
Slide 5: Financials Q1-3 2008
FINANCIALS Q1-3 2008 Christian Merrild, CFO 5
Slide 6: Higher costs erodes margin
HIGHER COSTS ERODES MARGIN Change Q1-3 Q1-3 Change DKK mill. Q3 2007 Q3 2008 08/07 2007 2008 08/07 Revenue 2.263 2.259 0% 6.247 6.412 3% Revenue growth, % 12,0 -0,2 14,2 2,6 Operating profit before depreciation (EBITDA) 472 394 -17% 1.072 828 -23% EBITDA-margin, % 20,9 17,4 17,2 12,9 Profit on dispo
Slide 7: Q3 per business area
Q3 PER BUSINESS AREA DKK mill. Q3 2007 Q3 2008 Change, % Comments Revenue DFDS Group 2.263 2.259 -0,2 Ro-Ro Shipping 951 1.009 6,1 Volumes down 6%, rate level stable, increase in BAF Container Shipping 420 424 1,0 Increase in industrial volumes, increase in BAF, capacity reduced Passenger Shipping 6
Slide 8: Q1-3 EBITDA margin development
Q1-3 EBITDA MARGIN DEVELOPMENT Q1-3: EBITDA m argin developm ent (adjusted for increase in bunker surcharge) • Adjusted for rise in bunker surcharge, 18 revenue for Q1-3 2008 was 2% lower than same period 2007 17 1,0 • Bunker: Net increase in bunker cost decreased margin by 1.0% point 16 0,3 • Chart
Slide 9: Cash flow & investments
CASH FLOW & INVESTMENTS • Free cash flow of DKK 464 mill. for Q1-3 2008 Cash flow & investments 1.100 • Net investments year-to-date of DKK 243 mill. 900 include, DKK mill.: 700 • -137, deposit on ships to be delivered in 2009 DKK mill. 500 • -62, deposit lengthening of 3 ro-ro ships • -132, docking
Slide 10: Solid financial platform
SOLID FINANCIAL PLATFORM Debt and Equity Ratio 5 41 • Net interest bearing debt reduced by 16% to 40 4 DKK 3.59 bill. from end of Q3 2007 39 • Net interest bearing debt reduced by 7% from 3 DKK bill. end of 2007 % 38 2 • Equity ratio rose to 41% end of Q3 2008 from 37 37% at end of Q3 2007 1 36 0 35
Slide 11: Volatile oil price & exchange rates
VOLATILE OIL PRICE & EXCHANGE RATES Oil price 2008, USD & DKK • Oil price peaked at a rise of 55% in early July, high average price 160 800 in Q3 • H1 08: Avg. USD per barrel: 111 • Q3 08: Avg. USD per barrel: 119 140 700 • Net bunker cost DKK 26 mill. higher than expected in Q3 mainly due to lower
Slide 12: Going forward 2008
GOING FORWARD 2008 Niels Smedegaard, President and CEO 12
Slide 13: Market situation 2008 expectations for Q4
MARKET SITUATION 2008 EXPECTATIONS FOR Q4 • Economic downturn now more widespread than previously in 2008 • Still pockets of growth compared to 2007, but downturn generally accelerated in SEP and OCT • Volumes on North Sea freight market coming under pressure, continued negative trend on the Contine
Slide 14: Completed adjustments of activities
COMPLETED ADJUSTMENTS OF ACTIVITIES Reduction of capacity Cost reductions • Ro-pax route Germany-Latvia reduced • Renegotiation of lo-lo rate agreements from two to one ship (Oct) • Phase two of DFDS Seaways’ profit • Ro-ro route Sweden-Belgium reduced from improvement plan implemented four to three
Slide 15: New adjustments of activities
NEW ADJUSTMENTS OF ACTIVITIES Reduction of capacity Cost reductions • Weekly departures reduced from 6 to 5 on • Esbjerg freight agency consolidated (CPH) ro-ro route Sweden-Belgium (Nov) • 10% staff reduction in Gothenburg, DTL • Smaller lo-lo ship on UK/Spain route • 10% staff reduction in DCL HQ
Slide 16: 2008 performance expectations DFDS Group
2008 PERFORMANCE EXPECTATIONS DFDS GROUP • Revenue growth of approximately 0%, previously at H1 2% • EBITDA decrease of approx. 20-25%, previously at H1 15-20% • Total net investments of approximately DKK 300 mill., previously at H1 DKK 400 mill. due to change in payments between 2008 and 2009 • Fre
Slide 17: Strategic agenda focused on downturn opportunities
STRATEGIC AGENDA FOCUSED ON DOWNTURN OPPORTUNITIES • We started our operational adjustments early and are well under way • Focus on debt reduction and bolstering the financial platform of the Group is progressing above expectations • As we predicted in August “this will be deeper and last longer” th
Slide 18: From routes to network Q&A
FROM ROUTES TO NETWORK Q&A Thank you for your attention!