Precious Shipping Public Co., Ltd. · SET:PSL

Precious Shipping Public — Q3 2022 Earnings Presentation

51 slides from Precious Shipping Public's earnings presentation, Nov 7, 2022

  1. Slide 1: Precious Shipping Public Company Limited Analyst Meeting

    Precious Shipping Public Company Limited Analyst Meeting 7 Nov 2022

  2. Slide 2: Dry Bulk Freight Markets

    Dry Bulk Freight Markets Precious Shipping PCL 2

  3. Slide 3: The BDI since start of 2016

    The BDI since start of 2016 6,000 13 Year high 5,500 5,650 – 7 Oct 2021 5,000 4,500 4,000 3,500 3,000 2,500 5 Year high 2,518 – 4 Sep 2019 2,000 1,500 1,760 – 1,000 30 Sep 2022 500 0 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Source: Clarksons a

  4. Slide 4: Despite China's faltering growth 9M 2022 has been very good

    Despite China’s faltering growth 9M 2022 has been very good! Latest available Data points on China in 9M 2022 Vs 9M 2021.  China’s Iron Ore imports in 9M 2022 was 823.1 MMT Vs 843.0 MMT 9M 2021 down by 2.4%.  China’s Coal imports in 9M 2022 was 200.9 MMT Vs 230.7 MMT 9M 2021 down by 12.9%.  China

  5. Slide 5: Growth in seaborne dry bulk trade – billion tonne-miles

    Growth in seaborne dry bulk trade – billion tonne-miles Seaborne Dry bulk Trade All Units In Billion Tonne-Miles 2017 2018 2019 2020 2021 2022F 2023F Iron Ore 8,190 8,190 8,022 8,408 8,545 8,359 8,448 Coal (includes Lignite) 4,881 5,204 5,136 4,655 4,912 5,040 5,126 Grains (includes Soybeans) 3,272

  6. Slide 6: Growth in seaborne minor bulk trade – billion tonne-miles

    Growth in seaborne minor bulk trade – billion tonne-miles Seaborne Minor Bulk Trade All Units In Billion Tonne-Miles 2017 2018 2019 2020 2021 2022F 2023F Steel Products 1,906 1,978 1,832 1,678 1,966 2,006 2,016 Forest Products 2,223 2,298 2,347 2,285 2,381 2,359 2,424 Other Minor Bulk 6,385 6,675 6,

  7. Slide 7: Commodities share by different dry bulk sectors

    Commodities share by different dry bulk sectors Commodities Capesize Panamax Supramax Handysize Iron Ore 74% 8% 4% 2% Coal 19% 50% 21% 9% Grains - 27% 17% 23% Minor Bulk 7% 15% 57% 64% Others - - 1% 2% 80% 74% 64% 60% 57% 50% 40% 27% 21% 23% 19% 17% 20% 15% 7% 8% 9% 4% 1% 2% 2% 0% 0% 0% 0% Capesize

  8. Slide 8: Dry bulk fleet at the start of Q4 2022

    Dry bulk fleet at the start of Q4 2022 Fleet Overview Ship Type DWT Range (MT) Ships Av Age (yrs) Total DWT (m MT) Av DWT (MT) % of DWT Handysize 10,000 – 39,999 4,241 13.37 114.30 26,950 11.90% Supra/Ultramax 40,000 – 69,999 3,981 11.36 223.98 56,262 23.32% Panamax 70,000 – 89,999 2,621 11.21 208.6

  9. Slide 9: PSL dry bulk supply side forecast

    PSL dry bulk supply side forecast Actual data for 9M 2022. PSL forecasts net fleet growth for 2022 at 3.00%, assuming 5% slippage and 1.71 MDWT of scrapping in Q4 2022. 9M 2022 Net Fleet Growth = 21.18 MDWT, +2.26%. Q4 2022 Net Fleet Growth = 7.00 MDWT, +0.73% 939.15 960.33 960.33 967.33 9.17 PSL pr

  10. Slide 10: Confirmed orders as of 1 Oct 2022 (MDWT) – 31 Dec 2025

    Confirmed orders as of 1 Oct 2022 (MDWT) – 31 Dec 2025 20 Total Confirmed Orders Until 2025 Year M DWT % of Fleet 2022 9.17 0.95% 16 2023 32.70 3.40% 2024 21.58 2.25% 2025 3.15 0.33% Total Orderbook 66.59 6.93% 11.95 12 Geared 23.69 7.00% 10.37 Gearless 42.90 6.90% 8.42 8.04 8 6.47 6.09 4 3.46 2.78

  11. Slide 11: Putting orderbook figures in context – overall dry bulk fleet

    Putting orderbook figures in context – overall dry bulk fleet 1000 971 100% Dry Bulk Fleet 939 907 All Figures In M DWT Unless 873 Otherwise Indicated (30 Sep 2022) 841 78.14% 814 Total Fleet 960.33 790 800 754 772 80% Total Orderbook to end 2025 66.59 719 Orderbook % Fleet 6.93% 677 % Fleet Over 20

  12. Slide 12: Putting orderbook figures in context – geared vessels only

    Putting orderbook figures in context – geared vessels only 80% 80% 60% 60% 40% 19.02% 40% 20% 15.46% 20% 0% 0% 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 Orderbook % of Fleet (Handy) Orderbook % of Fleet (Supras/Ultras) % of Fleet Over 20y (Supras/Ultras) % of Fleet Over 20y (Handy)

  13. Slide 13: DWT of dry bulk ships ordered in 9M versus prior years

    DWT of dry bulk ships ordered in 9M 22 versus 9M 19, 20 and 21 % Change New Orders in % Change Year Avg. BDI in 2022 MDWT in 2022 9M 2019 1,285 +61% 33.55 -27% 9M 2020 971 +113% 39.91 -39% 9M 2021 2,764 -25% 30.69 -20% 9M 2022 2,066 - 24.47 - Source: Clarkson’s, 30 Sep 2022 Reasons why new ship orde

  14. Slide 14: Port congestion - till end of Q3 2022

    Port congestion - till end of Q3 2022 Bulkcarrier (Capesize & Panamax) Port Congestion as % of Capesize & Panamax Fleet 36%  Data basis vessels 33.2% 33.8% in a defined port or 31.0% 31.6% 32% 30.2% anchorage location 29.9% 28.8% based on vessel’s 28% closest to midday AIS signal. 24% 2016 2017 201

  15. Slide 15: Average speed – till end of Sep 2022

    Average speed – till end of Sep 2022 (Knots) 11.6 11.54 11.52 11.50 11.50 11.39 11.38 11.38 11.4 11.35 11.29 11.25 11.2 11.17 11.0 10.97 10.8 Capesize Panamax Supramax Handysize 2012-2020 Avg 2021 Avg 9M2022 Avg Source: Clarksons as on 30 Sep 2022 Precious Shipping PCL 15

  16. Slide 16: Differences in 2003-2009, 2010-2020, 2021 and the future

    Differences in 2003-2009, 2010-2020, 2021 and the future Daily average Time Charter rate 2003 – 2009 2010 – 2020 2021 9M 2022 Capesize 67,101* 14,924*** 33,333** 16,585** Panamax 32,793* 10,965*** 27,898** 22,240** Supramax 28,013^^ 10,765*** 26,768** 24,500** Handysize 18,753^^ 8,789*** 25,702** 23

  17. Slide 17: Why did the challenges in 9M of 2022 not sink the freight market?

    Why did the challenges in 9M of 2022 not sink the freight market? Challenges in 2022:  China’s dismal import/export performance.  Russia-Ukraine war reduced grain, coal, and other commodity shipments.  Central banks ended Covid stimulus, ended QE, and raised interest rates, to combat inflation. 

  18. Slide 18: Key industry takeaways

    Key industry takeaways The good news in 2021  Dry bulk supply-demand balance was finally reached by mid 2021.  China’s USD 667b steel intensive fiscal stimulus announced on 22 May 2020 pushed the BDI to 5,650 a 13-year high on 7th October from 1,374 points at the start of 2021!  Material improvem

  19. Slide 19: Catalysts to watch out for

    Catalysts to watch out for Precious Shipping PCL 19

  20. Slide 20: Catalysts to watch out for

    Catalysts to watch out for 1. Ukraine’s existing ~22 MMT of grain lying in silos at their ports gets shipped. Almost 10 MMT has already been shipped out. 2. Ukraine’s unharvested grain in the fields of ~20 MMT moves into the empty Port silos. 3. Cargoes from Russia and Ukraine, in the Black Sea, get

  21. Slide 21: New Regulations – EEXI and CII

    New Regulations – EEXI and CII Precious Shipping PCL 21

  22. Slide 22: Energy Efficiency Existing Ship Index or EEXI

    Energy Efficiency Existing Ship Index or EEXI 1. What is EEXI? It is a design efficiency index and requires a one-time technical adjustment for non-compliant existing vessels. It describes the CO2 emissions per cargo ton-mile, by determining the standardized CO2 emissions related to installed engine

  23. Slide 23: Carbon Intensity Indicator or CII

    Carbon Intensity Indicator or CII 1. What is CII? It is an operational efficiency index, which aims to ensure continuous improvement in a vessel's emissions. The CII framework regulates the carbon emissions per unit of ‘transport work’ or the operating mileage each year. CII is expressed in grams of

  24. Slide 24: Impact of CII on the bulk carrier fleet

    Impact of CII on the bulk carrier fleet DWT of existing ships DWT of ships above 10 years / % DWT of new buildings till 2025 / % Handysize 114.30 71.83 / 63% 3.98 / 3% Supra/Ultramax 223.98 120.13 / 54% 19.71 / 9% Panamax 208.61 107.20 / 51% 20.88 / 10% Capesize 413.44 221.79 / 54% 22.02 / 5% Total

  25. Slide 25: PSL's Strategy

    PSL’s Strategy Precious Shipping PCL 25

  26. Slide 26: PSL fleet

    PSL fleet As of 31st Dec 2018 31st Dec 2019 31st Dec 2020 31st Dec 2021 30th Sep 2022 Number of 36 36 36 36 38 Vessels Average Age 7.3 years 8.3 years 9.3 years 10.3 years 10.7 years (Simple Avg) Insured Value 700.3 650.0 650.0 747.6 799.2 (US$ million) Book Value 689.4 664.9 634.8 605.0 637.6 (US$

  27. Slide 27: Market segmentation Q3 2022

    Market segmentation Q3 2022 Index PSL Avg Q3 2022 Market PSL Performance Index PSL Avg PSL Ship Index Speed/Con Speed/Con Average Av. TC Av. TC vs Ship DWT Ship DWT Number (1) (1) Index Rate (2) Rate Benchmark Laden: Laden: 17 Handysize 12K/18T 12K/20T BHSI & USD USD 38,000 31,010* 1,039 -11.62% (Ha

  28. Slide 28: Current and rolling 4-year forward book until 2025

    Current and rolling 4-year forward book until 2025 Contract Total USD 108.27 m USD 72.14 m USD 28.03 m USD 27.95 m value USD 236.39 m 25,000 100% 21,459 20,000 17,561 80% 15,316 15,316 15,000 60% 13,501 13,870 13,908 13,870 10,000 30% 40% 37% 5,000 13% 13% 20% 5,045 4,108 1,830 1,825 0 0% 2022 2023

  29. Slide 29: Financials

    Financials Precious Shipping PCL 29

  30. Slide 30: Q3 2022 highlights

    Q3 2022 highlights Q3’2022 Highlights • Net income of Baht 1,348.04 million (USD 36.37 million), or Baht 0.86 (USD Quarterly Results 0.0233) per share • EBITDA of Baht 1,696.64 million (USD 45.77 million) • PSL declared an interim dividend (No.2) of 50 Satang which was paid on 12 Dividend September

  31. Slide 31: Key figures

    Key figures Q3 2022 Q2 2022 Revenue ($ million) 68.8 37 76.3 Net Profit ($ million) 0.30 36.4 48.0 Earning per Share (Baht) 0.86 1.06 Return on Equity * 35.6% 38.7% Net Debt / Equity Ratio 0.35 0.35 Number of Ships 38 37 * Excluding exchange gain (loss) and non-recurring items Precious Shipping PCL

  32. Slide 32: Earnings and liquidity

    Earnings and liquidity TC Rate/Day in $ Historical EBITDA ($ million) 30,000 26,429 24,722 23,901 90 25,000 21,995 19,840 70 62 20,000 17,841 57 57 49 46 15,000 12,157 50 10,022 35 8,398 8,786 10,000 6,099 30 20 5,000 11 14 9 10 3 0 -10 Cashflows from operations ($ million) Cash Balance ($ million)

  33. Slide 33: Statement of financial position ($ million)

    Statement of financial position ($ million) 800 Liability Liability Assets & Equity Assets & Equity 700 39 23 600 500 430 481 400 607 640 300 28 30 200 246 100 207 74 39 0 30-Sep-22 30-Sep-22 31-Dec-21 31-Dec-21 Cash Vessels & Equipments Other Assets Loans Other Liabilities Shareholder's Equity Prec

  34. Slide 34: Cash movement in Q3'2022 ($ million)

    Cash movement in Q3’2022 ($ million) Precious Shipping PCL 34

  35. Slide 35: Operating expense analysis ($/Day)

    Operating expense analysis ($/Day)  These are the fixed costs required to run a ship and are evenly spread over 365 days.  Our operating costs per ship per day for Q2’2022 and Q3’2022 were USD 4,683 and 5,159 respectively. Precious Shipping PCL 35

  36. Slide 36: Operating expenses industry comparison ($/day)

    Operating expenses industry comparison ($/day)  OPEX Comparison with Industry compiled by BDO LLP  OPEX excluding dry dock and special survey cost  Industry OPEX for 2021 will be published end of November 2022 6,000 5,238 5,152 5,020 4,892 4,903 5,000 4,529 4,086 4,036 4,142 4,181 4,095 4,000 3,0

  37. Slide 37: Supramax/Ultramax sector peer analysis for Q2 2022

    Supramax/Ultramax sector peer analysis for Q2 2022 We have the lowest daily OPEX* + G&A and the highest EBITDA/Ship  For Q2 2022: PSL’s Supramax/Ultramax average daily OPEX* + G&A came in at $4,740 per vessel per day 8,000 7,279 6,973 7,000 6,643 1,355 1,389 946 6,000 5,256 5,000 4,740^ 1,208 739 4

  38. Slide 38: Debt maturity profile ($ million)

    Debt maturity profile ($ million) 70 60 50 26 40 14 13 30 11 20 38 34 11 26 25 23 14 10 12 13 4 0 2022 2023 2024 2025 2026 2027 2028 2029 Loan repayment Balloon payment Prepayment Precious Shipping PCL 38

  39. Slide 39: Net debt & net debt / equity ratio

    Net debt & net debt / equity ratio 1.5 500 407 412 397 1.2 376 400 345 1.1 353 1.1 1.0 281 0.9 0.9 300 0.9 0.8 Ratio 234 0.7 193 0.6 172 200 168 0.5 0.4 0.4 0.3 0.3 100 0.0 0 30 Sep 2022 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Year Net Debt (Million USD) Net Debt/Equity Ratio Precious Ship

  40. Slide 40: Average OPEX / TC rates

    Average OPEX / TC rates 9M’ Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Avg Age 15.6 15.7 15.8 16.6 17.4 19.0 20.0 19.6 20.6 17.1 15.4 14.2 11.4 11.4 10.5 9.8 5.8 6.3 7.3 8.3 9.3 10.3 10.7 45,000 42,812 44,050 43,621 36,187

  41. Slide 41: Dividends

    Dividends 2.1 2.0 420% 1.8 360% 350% 1.6 1.5 Dividends as % of EPS 1.5 1.5 300% 286% Dividends Baht 1.2 1.2 240% 1.0 1.0 0.9 0.8 0.8 0.8 0.8 0.8 180% 0.6 0.7 0.6 0.5 0.4 120% 0.4 70% 80% 80% 0.3 0.3 78% 0.3 0.3 56% 59% 61% 0.2 0.2 0.2 61% 60% 42% 0.1 0.1 36% 28% 25% 0.0 0% 2007* Sep 2022 2003 2004 2

  42. Slide 42: Financial highlights – Income statement

    Financial highlights – Income statement Particulars 9M-2022 9M-2021 Q3-2022 Q2-2022 Q3-2021 Total Revenues - USD Million 213.92 187.62 68.80 76.25 80.53 Net Profit (loss) - USD Million 123.35 83.94 36.37 47.95 45.40 Gain (loss) on derivatives - USD Million (0.04) (2.12) (0.02) (0.00) (1.86) Exchange

  43. Slide 43: Financial profile

    Financial profile Jan-Sep 2022 2021 2020 2019 2018 2017 Cash & Cash Equivalents $39.1m $73.9m $36.6m $39.2m $56.8m $56.7m Total Assets $718.3m $704.1m $712.3m $831.1m $857.9m $882.3m Gross Debt $207.0m $245.9m $318.3m $391.7m $432.8m $469.4m Net Debt $168.0m $172.0m $281.7m $352.5m $376.0m $412.6m E

  44. Slide 44: PSL and ESG

    PSL and ESG Precious Shipping PCL 44

  45. Slide 45: PSL's ESG footprint

    PSL’s ESG footprint  PSL is always reducing its environmental impact via new technologies and innovations. We replaced older and less fuel- efficient vessels between 2013 and 2017 with “eco-vessels” resulting in reduction of CO2 emissions. The PSL fleet's average gm CO2/ton*nm has reduced from 12.8

  46. Slide 46: Investor Relations

    Investor Relations Precious Shipping PCL 46

  47. Slide 47: Investor relations activities – 9M 2022

    Investor relations activities – 9M 2022 The Company has joined many events for press/analyst briefings, which are attended personally by the Managing Director, the Executive Directors and/or IR team. Some of the major events in which the Company participated in 9M 2022 are enumerated herein as under

  48. Slide 48: Shareholder's returns

    Shareholder’s returns Precious Shipping PCL 48

  49. Slide 49: Total return to shareholders: 1993 to Nov 2022

    Total return to shareholders: 1993 to 3 Nov 2022 640 605 75 496 512 520 500 480 458 480 60 423.2 440440 440 440440 440 351.2 320 45 Baht 239.2 149.2 160 105 30 72 60 6 67 90 112 35 22 16 16 4 6 9 6 25 61 82.2 8 0 0 0 0 0 0 51 15 -85 -10 -45 -70 -85 -81 -75 -85 -76 -80 -160 0 Inflow/Outflow Net Cash

  50. Slide 50: Final food for thought

    Final food for thought  Demand is expected to grow faster than Supply, especially for Minor bulks over the next couple of years. Cargoes that PSL carries, are growing faster than other cargoes and faster than effective net supply growth in the geared sector.  PSL is a Thai Corporate, but we have z

  51. Slide 51: Thank You !

    Thank You ! Precious Shipping Public Company Limited Website: www.preciousshipping.com | E-mail: [email protected], [email protected]

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