Navigator Holdings Ltd. · NYSE:NVGS
Navigator — Debt Investor Presentation (January 2017)
39 slides from Navigator's debt investor presentation, January 2017
Slide 1: Minimum US$100 million Senior Unsecured Bond Issue 2017/2021
Minimum US$ 100 million Senior Unsecured Bond Issue 2017/2021 January 2017 Navigator Holdings Ltd. “NVGS”
Slide 2: Disclaimer
DISCLAIMER About this Presentation We, Navigator Holdings Ltd. (“Navigator”, “Navigator Gas” or the “Company”), have prepared this presentation, together with its enclosures and appendices (collectively, the “Presentation”), to provide introductory information solely for use in connection with the c
Slide 3: Disclaimer
DISCLAIMER Risk factors: An investment in the Bonds involves a high level of risk. Several factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by statements
Slide 4: Summary of Key Risk Factors
SUMMARY OF KEY RISK FACTORS A number of risk factors may adversely affect the Company and its subsidiaries (together the "Group"). This summary is intended to highlight some of those risks, but is not intended to be exhaustive. Reference is made to the Company's published 2015 annual report page 3-2
Slide 5: Summary of Key Risk Factors Cont'd
SUMMARY OF KEY RISK FACTORS CONT’D • Due to our lack of diversification, adverse developments in the seaborne liquefied gas transportation business could adversely affect our business, financial condition and operating results. • Maritime claimants could arrest our vessels, which could interrupt our
Slide 6: Summary of Key Risk Factors Cont'd
SUMMARY OF KEY RISK FACTORS CONT’D • The Bonds may not be a suitable investment for all investors: Each potential investor in the Bonds must determine the suitability of that investment in light of its own circumstances. In particular, each potential investor should: • have sufficient knowledge and
Slide 7: Table of Contents
TABLE OF CONTENTS BACKGROUND NAVIGATOR GAS MARKET FINANCIAL INFORMATION APPENDIX 7
Slide 8: Investment Highlights
INVESTMENT HIGHLIGHTS ■ A fleet of 31 vessels and 2 newbuilds in the 15,000 - 24,999 cubic metres ("handy-size") gas carrier segment Leading player in handy-size ■ Significant market share of handy-size ethylene capable gas carriers gas carriers ■ In addition 5 larger midsize gas carriers 37,500 – 3
Slide 9: Key Terms
KEY TERMS Issuer: Navigator Holdings Ltd. Issue Amount/First Tranche Minimum US$ 100 million Borrowing Limit: US$ 200 million The net proceeds from the Bonds shall be used to (i) partly refinance Navigator Holdings Ltd 12/17 9.00% with ISIN NO 001 0665508 and (ii) for Use of proceeds: the Group’s ge
Slide 10: Table of Contents
TABLE OF CONTENTS BACKGROUND NAVIGATOR GAS MARKET FINANCIAL INFORMATION APPENDIX 10
Slide 11: Navigator at a Glance
• NAVIGATOR AT A GLANCE Enabling opportunities in Energy, Plastics and Fertiliser markets Global Trade Diversification *Europe 32% Africa & MEG 32% Asia 17% SAM 15% NAM 14% Leading Handysize Market Share ¦ Cargo Diversification Growing Together with Our Customers Owned Newbuildings Building for futu
Slide 12: Industry Overview: Three Main Classes of Gas Ships
INDUSTRY OVERVIEW: THREE MAIN CLASSES OF GAS SHIPS 12
Slide 13: Gas Carrier Markets: More to It Than LPG
GAS CARRIER MARKETS: MORE TO IT THAN LPG Global Seaborne Transportation LPG Petrochemicals Ammonia 150 20 20 15 15 Million Tons Million Tons Million Tons 100 10 10 50 5 5 - - - 2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 2019 Str
Slide 14: Our Changing Trading Patterns: 2015 vs 2016
OUR CHANGING TRADING PATTERNS: 2015 VS 2016 2015: Transatlantic LPG 2016 YTD: Deep Sea Petrochemicals ARA Ethylene and Butadiene Exports Transatlantic LPG Caribbean LPG Houston Ethylene Exports MEG Ethylene Exports Brazil Butadiene Exports Spot Earnings Days 9M 2015 Spot Earnings Days 9M 2016 Change
Slide 15: We Are Actively Implementing Changes to Our Cargo Mix
WE ARE ACTIVELY IMPLEMENTING CHANGES TO OUR CARGO MIX Total Earning Days 2015 vs 2016 Monthly Revenue by Cargo Type 2016 (US$m) 2,800 30 Days USD $ Millions 2,400 25 LPG Spot 2,000 20 Petchems Spot 1,600 Petchems TC 15 1,200 10 LPG Time Charter 800 5 400 Ammonia Time - - Charter Jan Feb Mar Apr May
Slide 16: Partnership Strategy: Integral Part of the Value Chain
PARTNERSHIP STRATEGY: INTEGRAL PART OF THE VALUE CHAIN Producer of LPG Producer of Ethylene Producer of Fertilizers. 4x Ice Class Semi- 1x Large Ethane capable vessel 1 x New generation Midsize Refrigerated vessels on 5- on 10 year contract vessel on 10 year contract 10 year contracts 16
Slide 17: Table of Contents
TABLE OF CONTENTS BACKGROUND NAVIGATOR GAS MARKET FINANCIAL INFORMATION APPENDIX 17
Slide 18: Gas Carrier Fleet Overview
GAS CARRIER FLEET OVERVIEW 246 39 15.9% 24 - - 90 27 30.0% 105 12* 11%* 333 18 5.4% 642 7 1.1% * Excludes 13 vessels contracted at Sinopacific SOE shiyard, some of which have already been cancelled Source: Clarksons 2017 18
Slide 19: Handysize Gas Fleet Overview
HANDYSIZE GAS FLEET OVERVIEW Owner Existing On Total Ethylene Handysize Delivery Schedule* Fleet Order Global United Navigator Gas Petredec StealthGas Ultragas Yara Tianjin Southwest 2017 Q1 Navigator Gas 32 1 33 [10] Q2 Time of Delivery Ultragas 8 1 9 - Q3 Petredec 4 4 8 [4] Q4 2018 Q1 Naftomar 7 -
Slide 20: Ethylene Focus
ETHYLENE FOCUS US Ethylene expansions 2016 – 2019 Market Share Handysize Ethylene Vessels (cbm) Mill mts Existing Exsisting Addition 2017 2018 2019 45 Westlake Chems, Calvert City 370 - - Navigator 40 Westlake Chems, Lake Charles 63 - - Vessels + 33% 10.4 LyondellBasell, Corpus Christie 265 - - 35 E
Slide 21: Table of Contents
TABLE OF CONTENTS BACKGROUND NAVIGATOR GAS MARKET FINANCIAL INFORMATION APPENDIX 21
Slide 22: 2016 9M Highlights
2016 9M HIGHLIGHTS 2016 9M HIGHLIGHTS Gross Revenue EBITDA NET INCOME US$218.7m US$106.5m US$37.0m Vessels owned Avg daily charter rate Fleet Utilization 32 US$26,499 87.2% 22
Slide 23: Gas Carrier Charter Rates
GAS CARRIER CHARTER RATES 2,000 78,000cbm - VLGC Navigator’s Daily TC Rates (US$) 22,000cbm - Semi-ref - Handy 29.7 30.0 30.3 1,800 30 28.6 28.9 28.3 27.4 26.5 22,000cbm - Fully-ref - Handy 25.6 23.6 24.1 1,600 8,250cbm - Small 20 Average 2006 -2016 US$27,540 per day 1,400 10 1,200 1,000 0 2006 2007
Slide 24: Committed Revenue
COMMITTED REVENUE Total US$ 606.4M in committed revenue 2017-2019 2019+ Committed Revenue EBITDA Average TCE Committed Revenue US$326.6M US$224.2M US$25,796 US$279.8M Committed revenue for the Navigator fleet 2017 2018 2019 Total Available days 13,416 13,716 13,556 40,688 Committed charter days1 5,7
Slide 25: Daily Operating Expenses
DAILY OPERATING EXPENSES Navigator’s Daily Operating Expenses Analysis of Operating Expenses (US$) 9,000 1.0% 8,115 8,068 8,091 7,916 6.7% 8,000 7,779 7,632 7,415 7,316 7,102 5.4% 7,000 6,612 6,208 5.4% 6,000 1.7% 5,000 53.3% 4,000 14.0% 3,000 8.4% 2,000 1,000 Crew Lubes & Stores Repairs 0 Upgrade I
Slide 26: Break Even Analysis
BREAK EVEN ANALYSIS Comments Break even and TCE rates Operating expenses Brokerage commission G&A For the nine months ended 30th of September 2016, the Company had a cash break even rate of US$/d Drydocking costs Interest expenses Average TCE rate US$ 9,900 per day per vessel, before interest expens
Slide 27: Drydocking
DRYDOCKING Drydocking every 5 years Vessels over 15 years undertake a Condition Assessment every 2.5 years Estimated costs of drydocking are approx. US$800k, US$1.2M and US$1.75M for a five, ten and 15 year drydocking respectively. The interim survey at 17.5 years will cost approx. US$1.0M 2016 2017
Slide 28: Strong Balance Sheet & Banking Relationships
STRONG BALANCE SHEET & BANKING RELATIONSHIPS (US$'M) Current Lenders As of September 30, 2016 Actual Cash 49.8 Debt Secured term loan facilities 564.1 Unsecured Notes 125.0 Total Debt 689.1 Total Shareholders' equity 948.3 Total capitalization 1,637.4 Debt / Capitalization 42.1% 28
Slide 29: Indebtedness
INDEBTEDNESS Lending Facilities Outstanding - end of year (US$’M) Current Facilities Senior Unsecured Notes to be placed in 894 February 2017 maturing in February 2021, 813 replacing the Senior unsecured notes maturing 152 754 in December 2017. 745 135 130 US$270 million Secured Term Loan expiri
Slide 30: Vessel Value
VESSEL VALUE Navigator vessels Navigator newbuild vessels Outstanding Available Vessel Built Size (Cbm) NBV1 (US$’M) Debt2 Loan to value Purchase Price3 Debt5 US$’M Vessel Built Size (Cbm) US$’M US$’M Loan to value Navigator Leo 2011 20,600 47.4 Navigator Nova 2017 37,500 78.4 Navigator Libra 2012 2
Slide 31: Proportionate Vessel Debt
PROPORTIONATE VESSEL DEBT Handysize vessel values Average debt per vessel calculation US$’M 70 Gross Bank debt as of Q3 2016 572.2 60 Vessel Value US$'M Less: Cash as of Q3 2016 49.8 50 Bond issue 125.0 40 Total net debt 647.4 30 Number of vessels 33 20 US$ 100M bond Net debt per vessel 19.6 10 2004
Slide 32: Finance: Contractual Obligations
FINANCE: CONTRACTUAL OBLIGATIONS 2017 2018 Thereafter Total (US$’M) Vessels under construction 95.6 - - 95.6 Term loan facilities/ bond issue 90.1 214.0 324.8 628.9 9% bond issue 125.0 - - 125.0 Drydocking costs - 8.5 11.1 19.6 Total contractual obligations 310.7 222.5 335.9 869.1 Instalments paid a
Slide 33: Finance: Balance Sheet
FINANCE: BALANCE SHEET (US$'M) 2010 2011 2012 2013 2014 2015 Q3 2016 Assets Cash and cash equivalents 16.2 26.7 150.9 194.7 62.5 87.8 49.8 Other current assets 15.2 11.2 20.5 31.9 22.0 37.2 41.8 Vessels in operation (net) 418.5 455.3 586.7 1,026.3 1,145.1 1,264.4 1,413.9 Vessels under construction -
Slide 34: Finance: Income Statement
FINANCE: INCOME STATEMENT (US$'M) 2011 2012 2013 2014 2015 Q3 2016 Net operating revenue 71.2 118.9 189.0 259.9 281.5 190.4 Operating expenses: Address and brokerage commissions 2.7 4.2 5.5 6.7 7.0 4.4 Charter in costs 0.3 11.3 6.8 9.1 - - Vessel operating expenses 22.9 32.8 60.3 70.2 78.8 68.2 Depr
Slide 35: Finance: Cash Flow Statement
FINANCE: CASH FLOW STATEMENT (US$'M) 2011 2012 2013 2014 2015 Q3 2016 Net Income 18.7 30.5 42.2 87.7 98.1 37.0 Depreciation and amortisation 18.7 24.2 36.6 45.8 53.5 45.7 Drydocking payments - - -2.9 -5.3 -11.6 -9.7 Non cash movements 1.1 1.8 2.9 3.8 5.9 3.7 Change in working capital 6.5 -1.6 1.2 1.
Slide 36: Table of Contents
TABLE OF CONTENTS BACKGROUND NAVIGATOR GAS MARKET FINANCIAL INFORMATION APPENDIX 36
Slide 37: Management
MANAGEMENT ■ Chairman of the Board since August 2006 David Butters ■ Former managing director at Lehman Brothers Inc, where he was employed for more than 37 years Chairman, President and Chief Executive Officer ■ Chairman of the board of directors of GulfMark Offshore, Inc. and a member of the board
Slide 38: Large Shareholders
LARGE SHAREHOLDERS Company Milestones Top 15 shareholders Name # shares ('000) Ownership Owned Newbuildings 1997 Navigator Holdings was formed with the purpose of 1 WL Ross & Co Ltd 21,864 39.4 % building and operating a fleet of five semi-refrigerated, ethylene-capable gas carriers 2 David Butters
Slide 39: NGT Services (UK) Limited contact details
NGT Services (UK) Limited 21 Palmer Street, London SW1H 0AD United Kingdom Tel: +44 (0) 20 7340 4850 Navigator Gas US, LLC 399 Park Avenue New York NY 10022 United States of America Tel: +1 (212) 355 58930 www.navigatorgas.com
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