Gaztransport & Technigaz Sa · EURONEXT:GTT
Gaztransport & Technigaz Sa — Investor Presentation (January 2020)
55 slides from Gaztransport & Technigaz Sa's investor presentation, Jan 13, 2020
Slide 1: Investor Presentation
Investor Presentation H1 2019 Results / Q3 2019 Activity update 13 January 2020
Slide 2: Disclaimer
Disclaimer This document is strictly confidential. Any unauthorised access to, appropriation of, copying, modification, use or disclosure thereof, in whole or in part, by any means, for any purpose, infringes GTT’s rights. This document is part of GTT’s proprietary know-how and may contain trade sec
Slide 3: Disclaimer
Disclaimer This presentation does not contain or constitute an offer of securities for sale or an invitation or inducement to invest in securities in France, the United States or any other jurisdiction. It includes only summary information and does not purport to be comprehensive. No representation,
Slide 4: Agenda
Agenda 1. Company overview & key highlights 2. Core business: Market & Activity update 3. New businesses: LNG Fuel developments 4. Service activity 5. Stategic roadmap 6. Financials 7. Outlook Appendices 4
Slide 5: Company overview & Key highlights
1 Company overview & Key highlights 5
Slide 6: GTT at a glance
GTT at a glance Profile A French technology and engineering Consolidated key figures company with more than 50-year track record in € million H1 2019 Expert in liquefied gas containment systems GTT is a public company listed on the Total Revenues 123 Euronext Stock Exchange (Paris), Royalties (newbu
Slide 7: 2019 Key Highlights
2019 Key Highlights Strong level of new orders 9M: 40 LNGC, 6 VLEC and 3 GBS Q4: 17 additional LNGC orders New commercial successes in LNG Fuel business including: 9M: 1 bunker ship, 1 container ship converted to LNG on behalf of Hapag Lloyd, 5 container ships on behalf of a European ship-owner Q4:
Slide 8: Core Business as at September 30, 2019: A strong order book
Core Business as at September 30, 2019 A strong order book 9M 2019 movements 40 LNGC new orders 6 VLEC 3 GBS deliveries 23 LNGC © Shell 3 FSRU Order book of 120 units LNGC VLEC FSRU FLNG Onshore storage / GBS Notes: LNGC – Liquefied Natural Gas Carrier, VLEC – Very Large Ethane Carrier, © SCF Group
Slide 9: New Business (LNG as Fuel): A growing order book
New Business (LNG as Fuel) as at September 30, 2019 A growing order book © SCF Group © GTT © GTT Order book of 18 units 9M 2019 movements ULCS (Ultra Large Container Ships) new orders 1 LNG Bunker ship Container vessel (converted to LNG) 1 Container vessel 5 ULCS Cruise ship LNG bunker ships 9
Slide 10: Core business: Market & activity update
2 Core business: Market & activity update 10
Slide 11: Overall long term outlook bright for gas and LNG
Overall long term outlook bright for gas and LNG Gas share in the energy mix LNG share in total gas trade Gas is the only fossil energy to increase share in Gas is increasingly exported thanks to the energy mix LNG Gas is expected to exceed coal by 2025, and could LNG to overpass pipeline trade by b
Slide 12: LNG Supply & Demand: new capacity needed
LNG Supply & Demand: new capacity needed LNG Supply & Demand balance forecast 700 600 235 Mtpa 500 400 Mtpa 300 200 100 0 2003 2005 2007 2009 2011 2000 2001 2002 2004 2006 2008 2010 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 203
Slide 13: Liquefaction projects: new FIDs in Q3, more in the offing
Liquefaction projects: 2 new FIDs in Q3, more in the offing Volume Project Country Operator Comments (Mtpa) Golden Pass US Exxon, QP 15.6 Sabine Pass T6 US Cheniere 4.5 Cheniere has now 36 Mtpa capacity at Sabine Pass and Corpus Christi FID taken Mozambique LNG-1 Mozambique Anadarko 12.9 Ownership t
Slide 14: Arctic LNG-2 recent FID: opportunity for GTT with 1st GBS ordered
Arctic LNG-2 recent FID: a great opportunity for GTT to expand in the LNG value chain with 1st GBS ordered From liquefaction To plant Regasification Trans shipment Regas terminal: Onshore or FSRU Ice class Conventional GBS LNG carrier LNG carrier The Arctic LNG-2 project sanctioned in September 2019
Slide 15: GBS is suitable for a very wide range of applications
GBS is suitable for a very wide range of applications @ SemCorp @ Acciona Concrete or steel, installed in jetty, breakwater dike or nearshore GBS range 5k 50k 200k+ Storage capacity (cbm) LNG SUPPLY CHAIN • Liquefaction or regasification plants • Peak Shaving • Satellite Station • Inland distributio
Slide 16: Ethane: Order of 6 VLEC in September 2019
Ethane: Order of 6 VLEC in September 2019 An increasing ethane transportation market Transportation of Liquefied Ethane is an increasing US ethane production, consumptions and exports market, driven by the strong development of shale gas and shale oil production in the US Excess supply of ethane (by
Slide 17: Core business long term estimates
Core business long term estimates GTT 9M 2019 Sales GTT order estimates over 2019-2028 Other Services LNGC: between 280 and 310 units(1) LNG Fuel 1% 5% FLNG 3% 2% FSRU FSRU: between 30 and 40 units 10% FLNG: Up to 5 units LNGC 79% Onshore and GBS tanks: between 10 and 15 units Courtesy of Shell Cour
Slide 18: New businesses: LNG Fuel developments
3.2 3 New businesses: LNG Fuel developments 18
Slide 19: IMO 2020: different approaches to reduce emissions, among them LNG
IMO 2020: different approaches to reduce the emissions, among them LNG 1 0,75 Base 1 LNG is the only solution 0,5 HFO 0,25 HFO+ Scrubber allowing comprehensive 0 LSHFO environmental compliance LNG New LNG bunkering infrastructure under development Improving availability International O&G companies n
Slide 20: LNG Fuel: open loop scrubbers banned in key areas
LNG Fuel: open loop scrubbers banned in key areas Map of open loop scrubbers ban areas Norway Ireland Lithuania, Latvia Belgium California Connecticut China UAE Malaysia India Singapore Source : GTT, Lloyd’s list NB: Not exhaustive list - Other ports in Ireland and the US ban open loop scrubbers Maj
Slide 21: LNG as fuel is a short payback solution
LNG as fuel is a short payback solution Payback of LNG as fuel vs compliant fuels 100 80 $60/bl : LNG payback 4 years 60 M$ 40 $80/bl : LNG payback <1.5 year 20 0 (Year 1) Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Extracapex 2022 -20 Curr
Slide 22: GTT's LNG Fuel solutions offering
GTT’s LNG Fuel solutions offering GTT has developed solutions for the main applications of LNG Fuel Solutions for Container Vessels new build and retrofit Cruise Ship – optimizing the space for additional passengers Lean bunker barge to Cost effective solution for bulk carriers standardize the marke
Slide 23: LNG Fuel: dedicated GTT Services are key for new customers
LNG Fuel: dedicated GTT Services are key for our new customers LNG Training Services: courses and software Particularly suited for newcomers in LNG Fuel Assistance to first bunkering operations Advising the world’s first LNG bunkering operations HEARS – Hotline for emergency situations Available 24/
Slide 24: LNG Fuel: wide network of partnerships
LNG Fuel: wide network of partnerships 25 shipyards under licensed agreements Network of membrane tank outfitters A close relationship with engine makers and FGHS1 providers (1) Fuel Gas Handling System 24
Slide 25: Commercial successes: container ships
Commercial successes: container ships… European ship-owner ULCS – Newbuilds – 14,000 m³ 5 ships in June 2019 Built at Jiangnan Shipyard Hapag Lloyd VLCS - LNG Retrofit – 6,700 m³ 1 ship in April 2019 Hudong-Zhonghua as membrane outfitter CMA CGM ULCS – Newbuilds – 18,600 m³ 9 ships in November 2017
Slide 26: Cruise ships and bunker vessels
… Cruise ships and bunker vessels PONANT Expedition Ship – 4,500 m³ 1 ship in July 2018 Built at VARD Norway GTT acting as EPC for the LNG tank Oct. 2018 MOL1 LNG Bunkering Vessel – 18,600 m³ 1 ship in January 2018 Built at Hudong Zhonghua Shipyard MOL1 LNG Bunkering Vessel – 12,000 m³ 1 ship in Mar
Slide 27: Service activity
3.3 4 Service activity 27
Slide 28: Services to make LNG easy
Services to make LNG easy Support of GTT’s LNG core activities Support for the development of LNG as fuel CONSULTING TRAINING LNG OPERATIONS EMERGENCY to get LNG as fuel to raise awareness to support operators in the to avoid escalation and projects on track about LNG first LNG operations minimise i
Slide 29: Strategic roadmap
5 Strategic roadmap 29
Slide 30: GTT's strategic roadmap
GTT’s strategic roadmap Growth, Towards a Gas handling technologies Technology, lower emission Transformation Maritime world Fuel Gas handling system for vessels Superior LNG gas handling systems Advanced decision support systems Enlargement New applications Transfer operations Advisory and LNG as f
Slide 31: Financials
6 Financials 31
Slide 32: H1 2019: Order book overview (core business) – IFRS 15
H12019: Order book overview (core business) – IFRS 15 Order book in units Order book by year of delivery (units per year) In units In units 60 47 48 120 107 40 (1) 97 30 30 30 90 16(4) 20 60 14 5 0 30 2019 2020 2021 2022 As at Dec 31, 2018 As at June 30, 2019 As at Dec 31, 2018 As at June 30, 2019 O
Slide 33: H1 2019 financial performance
H1 2019 financial performance Summary consolidated accounts Key highlights In € M H1 2018 H1 2019 Change Revenues Newbuilds (royalties): -4% Total Revenues 127.2 122.6 -3.6% • Royalties from LNGCs and FSRUs will fully benefit EBITDA(1) 84.2 70.9 -15.8% from the 2018 strong flow of orders from H2 201
Slide 34: H1 2019 Cost base
H1 2019 Cost base GTT consolidated operational costs Key highlights in € M H1 2018 H1 2019 Change (%) External costs: +32% Goods purchased (1.3) (2.6) +98.8% Subcontractors +57%, due to strong flow of orders % sales -1% -2% Other external costs +19% (mainly fees from external advisors and patent fil
Slide 35: First nine months 2019 consolidated revenues
First nine months 2019 consolidated revenues Summary financials Key highlights in €M 9M 2018 9M 2019 Change Total revenues: €200 million (+8.7%) (%) Revenues 183.7 199.7 +8.7% Revenues from newbuilds: the increase is mainly explained by the strong flow of LNG carrier orders Newbuilds 173.0 188.9 +9.
Slide 36: Outlook
7 Outlook 36
Slide 37: 2019 Outlook confirmed
2019 Outlook confirmed GTT revenue(1) 2019 consolidated revenue estimated in a range of €260M to €280M EBITDA 2019 consolidated EBITDA estimated in a range of €160M to €170M Dividend 2019 and 2020 payout of at least 80% Payment(2) (1) In the absence of any significant delays or cancellations in orde
Slide 38: Thank you for your attention
Thank you for your attention Image courtesy of STX, Engie, Excelerate, SCF Group, Shell, CMA CGM, Matthieu Pesquet, Conrad
Slide 39: Appendix
GIT Appendix
Slide 40: A streamlined group and organisation
A streamlined group and organisation GTT Group Philippe Berterottière* Chairman and Chief Executive Officer GTT SA organisation Lélia Ghilini* Secretary General General Counsel Frédérique Marc Haestier* Sandrine Vibert* Julien Bec David Colson* Karim Chapot* Coeuille* Finance & Human LNG as fuel Com
Slide 41: GTT exposure to the liquefied gas shipping and storage value chain
GTT exposure to the liquefied gas shipping and storage value chain Exploration Off Take / Liquefaction Shipping Regasification & Production Consumption Liquefied Natural Gas LNG fuelled Offshore Carrier ship clients: (LNGC) shipyards Platform / Gas-to-wire Installation Floating LNG Production, Float
Slide 42: GTT ecosystem
GTT ecosystem Oil & Gas Companies Shipowners End clients and End clients and prescribers prescribers provides services provides services and maintenance Classification Societies Regulatory oversight of the industry Shipyards Direct clients receives new technology certification and licences its membr
Slide 43: GTT membrane technologies
GTT membrane technologies Primary General principle: membrane Two membranes Primary insulation Two layers of insulations Secondary membrane Containment system Secondary insulation anchored to the inner hull Hull Mark III system NO96 system 43
Slide 44: Ageing LNGCs represent an additional market potential for GTT
Ageing LNGCs represent an additional market potential for GTT LNGC fleet by date of delivery 700 1. Future Orders associated 600 to new LNG projects 500 Nb of sips 400 300 200 100 2. Future Orders associated to replacement of old vessels 0 Source : Clarksons 1970 1980 1990 2000 2010 2020 Vessels >30
Slide 45: US LNG still competitive in Asia
US LNG still competitive in Asia US LNG vs. Asian LNG price depending on Henry Hub and Oil prices 10 Asian oil indexed Asian LNG LNG competitive competitive US LNG 9 LNG price ($/Mmbtu) HH : $3,5/Mmbtu 8 Spread HH : $3/Mmbtu US LNG 2018 avg. 7 HH : $2,5/Mmbtu 2019 avg. 6 5 Main sources: 40 45 50 55
Slide 46: LNG short term charter rates
LNG short term charter rates 46
Slide 47: LNGCs – Our main business
LNGCs – Our main business Vessels equipped for transporting LNG Existing GTT fleet: 390 units1 In order: 100 units1 26 construction shipyards under license1 Our strengths Technological leadership, boil-off divided by 2 in the last 5 years Long term industrial partnerships with major shipyards A uniq
Slide 48: FSRUs – The game changer for new importing countries
FSRUs – The game changer for new importing countries Major competitive advantage vs. land-based terminals: Quick to build/deploy & mobile Better local acceptability & easier permitting Affordable / no upfront CapEx Adapted to more volatile LNG prices Quality controlled construction in shipyards with
Slide 49: FLNGs – the new frontier of the LNG world
FLNGs – the new frontier of the LNG world Floating units which ensure treatment of gas, liquefy and store it Existing GTT fleet: 2 units1 In order: 2 units1 Courtesy of Shell Main drivers GTT key advantages Monetisation of stranded Extended amortization offshore gas reserves perspectives Better acce
Slide 50: Current LNG Fuel tank market situation
Current LNG Fuel tank market situation Total LNG fuel tank by ship type (in service & on order) 20 000 Max Total LNG tanks capacity Avg. 15 000 Min cbm 10 000 5 000 Market avg ~1,500 cbm 0 Notes: Data available for ~80% of the 320 vessels in service and Source: DNV GL on order Recent market that sta
Slide 51: LNG Fuel market potential for GTT
LNG Fuel market potential for GTT Relevant Market Segments Historical 10y Shipping Markets Fleet at end 2018 for GTT annual orders MAIN TARGETS Container Ships 3-20+ kTEU Bulkers 100+ kdwt ~260 ~5,400 Oil Tankers 125+ kdwt Cruise Ships All size ~40 ~1,200 Car & Truck Carriers TOTAL SHIPPING MARKET A
Slide 52: Focus on GTT's competitive advantages
Focus on GTT’s competitive advantages GTT’s technology positioning (1) GTT Moss SPB KC-1 Technology ▶ Membrane ▶ Spherical tank ▶ Tank ▶ Membrane ▶ Requires less steel and Construction ▶ Slightly higher costs aluminum than tanks for ▶ Higher costs ▶ Higher costs costs than GTT a given LNG capacity ▶
Slide 53: An attractive business model supporting high cash generation
An attractive business model supporting high cash generation Invoicing and revenue recognition Business model supports high cash generation % of contract (1) c. 9 to12 months c. 18 months Delivery Revenue is recognized pro-rata 10000 studies royalties temporis between construction milestones 8000 Sh
Slide 54: Appendix: track record of high margin and strong backlog
Appendix: track record of high margin and strong backlog 2008 2011 Economic crisis Fukushima US shale gas boom 120 112 66 30 18 52 77 99 114 118 96 89 97 47 44 37 34 35 51 Evolution of new 26 21 19 GTT orders (1)(2) 7 4 5 1 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 LNGC/VLEC F
Slide 55: Contact
Contact: [email protected] / +33 1 30 23 20 87
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