Odfjell Se Class A · OSL:ODF
Odfjell Se Class A — Q1 2010 Earnings Presentation
39 slides from Odfjell Se Class A's earnings presentation, May 5, 2010
Slide 1: 1st Quarter 2010 Result
1st Quarter 2010 Result Webcast 5 May 2010
Slide 2: Agenda
Agenda • Highlights • Organisational changes • 1Q2010 Financials • Norwegian tonnage tax • Sevmash • Market Update • Prospects
Slide 3: Highlights 1Q2010
HIGHLIGHTS 1Q2010 • Net result a loss of USD 4 million, EBITDA of USD 49 million and EBIT of USD 10 million • Stable time-charter results compared to 4Q2009 • Continued strong results from tank terminals • Contribution of USD 12 million to EBITDA from hedging of bunkers and currency • Four ships sol
Slide 4: New Board of Directors
NEW BOARD OF DIRECTORS Terje D. Storeng Irene Waage Basili Board member Board member Laurence W. Odfjell Chairman of the Board Bernt Daniel Odfjell Christine Rødseter Board member Board member
Slide 5: Modification of Organisational Structure
MODIFICATION OF ORGANISATIONAL STRUCTURE Board of Directors Chairman: Laurence W. Odfjell President/CEO Jan A. Hammer SVP/CFO SVP/Corp.Inv. Haakon Ringdal Tore Jakobsen SVP/QHSE SVP/HR Jan D. Lorentz tbn SVP/ Ship Management SVP/Operations &Chartering President/COO Helge Olsen tbn Odfjell Terminals
Slide 6: Result 1st Quarter 2010
RESULT 1ST QUARTER 2010 (USD million) 1Q2010 4Q09 Change Gross Revenue 310 320 (10) Voyage Expenses (110) (124) 14 TC Expenses (48) (45) (3) Operating Expenses (75) (89) 14 General and Administrative Expenses (28) (29) 1 Operating Result before Depr. (EBITDA) 49 32 17 Depreciation (38) (42) 4 Compen
Slide 7: EBITDA 1Q2010 versus 4Q2009
EBITDA 1Q2010 VERSUS 4Q2009 • Parcel Tankers EBITDA USD 14 mill. higher • Net revenue USD 8 mill. higher • TC expenses USD 3 mill. higher • Operating expenses USD 9 mill. lower • G&A Unchanged • Tank Terminals EBITDA USD 3 mill. higher • Net revenue USD 4 mill. lower • Operating expenses USD 5 mill.
Slide 8: Gross Revenue
GROSS REVENUE Per Quarter (in USD million) 450 398 400 357 367 354 350 311 313 321 320 310 300 250 200 150 100 50 0 2008 2009 2010 Accumulated 1,476 1,265 1,240* *Annualised
Slide 9: Operating Expenses
OPERATING EXPENSES Per Quarter (in USD million) 95 89 90 85 83 83 82 82 82 80 80 78 75 75 70 65 2008 2009 2010 Accumulated 330 329 300* *Annualised
Slide 10: Vessel Operating Expenses
VESSEL OPERATING EXPENSES (Large Parcel Tankers) $ 12 000 $ 10 000 $ 8 000 $ 6 000 $ 4 000 $ 2 000 $ 0 10 09 08 07 06 05 04 03 02 01 00 20 20 20 20 20 20 20 20 20 20 20 USD / day, total USD/day, crew
Slide 11: Dry-docking Cost
DRY-DOCKING COST (Large Parcel Tankers) $ 3 000 $ 2 500 $ 2 000 $ 1 500 $ 1 000 $ 500 $ 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 USD/day, 3 year moving average
Slide 12: Administrative Expenses
ADMINISTRATIVE EXPENSES Per Quarter (in USD million) 31 30 30 30 29 29 29 28 28 28 28 28 27 27 26 25 2008 2009 2010 Accumulated 116 113 112* *Annualised
Slide 13: Operating Result (EBIT)
OPERATING RESULT (EBIT) Per Quarter (in USD million) 70 63 60 52 50 40 42 40 30 20 20 15 16 10 10 10 0 2008 2009 2010 Accumulated 197 61 40* *Annualised
Slide 14: Net Interest Expenses
NET INTEREST EXPENSES Per Quarter (in USD million) 18 17 17 17 16 15 14 12 12 11 11 10 10 9 8 6 4 2 0 2008 2009 2010 Accumulated 66 44 36* *Annualised
Slide 15: Operating Result per Segment
OPERATING RESULT PER SEGMENT USD million 1Q09 2Q09 3Q09 4Q09 1Q10 Parcel Tankers 24 25 18 6 19 Tank Terminals 27 27 29 27 30 Sum EBITDA 51 52 47 32 49 USD million 1Q09 2Q09 3Q09 4Q09 1Q10 Parcel Tankers (5) (4) (11) 14 (11) Tank Terminals 20 20 21 6 21 Sum EBIT 15 20 10 20 10
Slide 16: Gross Revenue and EBIT per Segment
GROSS REVENUE AND EBIT PER SEGMENT 100 % 63 80 % 30 60 % 40 % 248 21 20 % 19 0% ‐ 11 ‐20 % Gross EBITDA EBIT Revenue ‐40 % Parcel Tankers Terminals
Slide 17: Tank Terminals Gross Revenue
TANK TERMINALS GROSS REVENUE Gross Revenue EBITDA 8,1 11,2 35,4 Rotterdam 13,7 Houston Other 13,4 7,7
Slide 18: EBITDA
EBITDA 350 300 250 200 USD mill 150 100 50 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 Annualised Tank terminals Tank containers Parcel tankers
Slide 19: Bunkers
BUNKERS 3.5% FOB Rotterdam USD/mt 800 700 600 500 400 300 200 100 0 2007 2008 2009 2010 Apr
Slide 20: Net Bunker Cost
NET BUNKER COST 80 70 70,1 59,3 2,2 64,8 60,7 60 57,3 8,1 50 14,7 2,8 40 3,7 USD mill. 68,8 69,3 70,9 30 49,9 20 40,8 10 - (0,9) (3,9) (4,0) (10) (0,5) (9,5) (20) 1Q09 2Q09 3Q09 4Q09 1Q10 Bunker purchase Bunker clauses Bunker hedging Net bunker cost
Slide 21: Hedging – Bunker
HEDGING – BUNKER Bunker 700 600 500 1,000 metric tons 400 300 200 100 0 2010 2011 2012 2013 2014 Bunker Adjustment Clauses Hedged Exposure
Slide 22: Hedging – Currency
HEDGING – CURRENCY Currency 800 700 600 NOK Million 500 400 300 200 100 0 2010 2011 2012 2013 2014 Hedged Exposure
Slide 23: Hedging – Debt
HEDGING – DEBT Debt 1 800 1 600 1 400 1 200 USD Million 1 000 800 600 400 200 0 2010 2011 2012 2013 2014 Liquidity Fixed Rate Swapped to Fixed Rate Floating Rate
Slide 24: Balance Sheet
BALANCE SHEET USD USD LIABILITIES ASSETS & EQUITY mill mill 3,000 3,000 Liquid assets Other liabilities 2,500 2,500 Other fixed and current assets 2,000 2,000 Tank terminals Interest bearing debt 1,500 1,500 1,000 Ships & newbuildings 1,000 Minority interest 500 500 Equity 0 0
Slide 25: Capital Expenditures (our share)
CAPITAL EXPENDITURES (our share) (In USD million) 2010 2011 2012 2013 China 27 29 6 6 x 9 000 dwt Docking 40 40 40 40 Terminals 85 49 46 42 Total 152 118 92 82
Slide 26: Capital Expenditures – Tank Terminals
CAPITAL EXPENDITURES – TANK TERMINALS (our share) (In USD million) 2010 2011 2012 2013 Rotterdam 35 35 38 38 Houston 12 2 8 4 Singapore 7 Korea* 8 6 Dalian Jiangyin Oman 23 6 Total 85 49 46 42 *Subject 100% financing
Slide 27: Proposed New Norwegian Tonnage Tax
PROPOSED NEW NORWEGIAN TONNAGE TAX • Option to stay in existing system or pay exit-tax to enter new system • Old system has substantial disadvantages (higher tax when funds are taken out, trapped cash) • Many disincentives to stay in old system, so paying exit-tax seems likely • Decision to made bef
Slide 28: Sevmash Arbitration Award Update
SEVMASH ARBITRATION AWARD UPDATE • Awarded USD 43.8 million plus 75% of legal expenses. • Payment due on the day of the award (31.12.09). • Message received in April that Sevmash do not intend to pay. • Have asked and obtained assistance from Norwegian authorities.
Slide 29: Fleet Development 2010
FLEET DEVELOPMENT 2010 • In February Odfjell Tankers took the MT Southern Jaguar (19,997 DWT/2009) on two years time charter for worldwide trading. • During first quarter, four ships, Bow Maasslot, Bow Maasstroom, Bow Power and Bow Fighter were sold for recycling. • Late April, Odfjell took delivery
Slide 30: Fleet Development – Vessel Age
FLEET DEVELOPMENT – VESSEL AGE 80 70 31.12.2005 60 31.12.2006 50 31.12.2007 40 31.12.2008 30 20 31.12.2009 10 31.03.2010 0 Number of ships Number of ships Number of ships less than 15 years more than 15 and more than 25 years less than 25 years
Slide 31: Tank Terminal Development 2010
TANK TERMINAL DEVELOPMENT 2010 • Completion of the Exir Chemical Terminals PJCCO (Iran) project with a total of 22,000 cbm. • Expansion construction of two tanks with a total of 10,700 cmb started in Houston. • Expansion construction of 15 tanks with a total of 63,120 cmb will start at Odfjell Termi
Slide 32: Market Update – Highlights
MARKET UPDATE – HIGHLIGHTS • Although 1Q10 not satisfactory, March stronger than February and January • Activity remains good into 2Q10 on exports from Middle East, increased exports from South America, improved phosphoric and sulphuric acid • Disappointing activity in CPP and in imports to Asia • V
Slide 33: ODFIX
Index 1990 = 100 0 20 40 60 80 100 120 140 160 180 2000 ODFIX 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Slide 34: Freight Rate Development
FREIGHT RATE DEVELOPMENT 1,000 mts stainless steel grade chemicals US$/Ton 140 120 100 80 60 40 20 0 2005 2006 2007 2008 2009 Houston/Rotterdam Houston/Far East Source: Quincannon Associates, Inc.
Slide 35: Freight Rate Development
FREIGHT RATE DEVELOPMENT 3,000 mts easy grade chemicals US$/Ton 120 100 80 60 40 20 0 2005 2006 2007 2008 2009 Houston/Rotterdam Houston/Far East Source: Quincannon Associates, Inc.
Slide 36: Market Development CPP
MARKET DEVELOPMENT CPP Monthly averages US$/Day 50 000 45 000 40 000 35 000 30 000 25 000 20 000 15 000 10 000 5 000 0 2005 2006 2007 2008 2009 2010 Source: Clarkson
Slide 37: Core Chemical Deep-sea Fleet 2003-2013
Core Chemical Deep-sea Fleet 2003-2013 Orderbook and estimated demolition per 01.05.10 '000 Dwt % of year-start fleet 2,400 16.0% 2,000 14.0% 1,600 12.0% 1,200 10.0% 800 8.0% 400 6.0% 0 4.0% 03 04 05 06 07 08 09 10 11 12 13 -400 2.0% -800 0.0% Deliveries Orderbook Actually demolished Estim. vessel o
Slide 38: Prospects – Odfjell
PROSPECTS – ODFJELL On the shipping side the recovery is slow. Good second quarter activity in certain trades, but pressure on freight rates will probably continue. Certain operators are entering new trades. Disposal of older units has made our tonnage situation tighter. Further fleet redu
Slide 39: Thank you for listening. Questions?
Thank you for listening. Questions?