BW LPG Limited · OSL:BWLPG
BW LPG — Pareto Oil & Offshore Conference 2020
21 slides from BW LPG's conference presentation, Sep 17, 2020
Slide 1: Pareto Oil & Offshore Conference 2020
Pareto Oil & Offshore Conference 2020 17 September 2020
Slide 2: Disclaimer and Forward-looking Statements
Disclaimer and Forward-looking Statements This presentation has been produced by BW LPG Limited (“BW LPG”) exclusively for information purposes. This presentation may not be reproduced or redistributed, in whole or in part, to any other person. Matters discussed in this presentation and any material
Slide 3: BW LPG – Demonstrated Market Leadership
BW LPG – Demonstrated Market Leadership Innovation & Profitability Technology Environment • First mover • ROE • LPG propulsion • Reuse – Retrofit • ROCE • Smart ships • Towards zero carbon • Dividends fuels 3
Slide 4: LPG is the solution
LPG Saves Lives 4.3 million 3 billion 51% • People die from cooking- related • WLPGA’s “Cooking for life” • Of the 2.1 billion people in indoor air pollution every year initiative India and China still use solid fuels for cooking • More than Malaria, Tuberculosis • Aims to switch one-third of 3 and
Slide 5: LPG is leading the energy transition
LPG Makes Sense Clean Efficient Widely available • Gas is nature’s cleanest • Gas produces more energy • LPG is portable, can be fossil fuel per unit than any of the stored and transported fossil fuels easily • Gas generates the lowest CO2 emissions per unit of • LPG is economical. It • Size and typ
Slide 6: Why Shipping?
Why Shipping? End usage; Total of 1,460 LPG Over 109 MT total Power seaborne exports in carriers on water in generation 2019, total capacity of 2019 35 million cbm Major exporters: Residential Mainly Propane and US and Middle Including 300 VLGC2 Butane East Industrial Product of natural gas Major im
Slide 7: LPG Supply - US drives the global LPG export growth
LPG Supply - US drives the global LPG export growth North America has surpassed Middle East, becoming the world’s largest LPG exporter by VLGC in 2019 37 North America 35 Middle East 34 34 32 33 28 In 2019, ~7 million 31 In 2019, over 4 million 31 25 tons of LPG were tons of LPG were 21 carried by B
Slide 8: LPG Demand - Far East, Indian Ocean and Southeast Asia drive import growth
LPG Demand - Far East, Indian Ocean and Southeast Asia drive the import growth for LPG Total 2019 LPG seaborne trade ~109 million tons, by VLGC ~ 78 million tons; More than 50% went to the Far East 9.1 10.1 3.1 5.7 5.9 2.3 2018 2019 2018 2019 2018 2019 36.8 40.2 Northwest Europe Mediterranean Indian
Slide 9: VLGC Fleet Profile
VLGC Fleet Profile 10% of global fleet will be over 27 years by 2022, matching the orderbook Global VLGC fleet profile — average age of 9.9 years BW LPG VLGC market share3 of 15% Delivered VLGCs Recycled VLGCs VLGCs on orderbook Other VLGC NB Recycling candidates VLGC count at year end 34 50 400 318
Slide 10: Market Leader – Returns, Technology and Environment
Market Leader – Returns, Technology and Environment 10
Slide 11: Our Focus is Profitability
Our Focus is Profitability Average of listed BW LPG peers How? Rolling averages for last four quarters (Q3 2019 – Q2 2020) Competitive G&A levels Earnings Yield1 66.6% 34.5% Well-maintained and efficient fleet, with low vessel Opex Access to highly competitive ROE2 36.7% 16.9% financing costs, backe
Slide 12: Timing the Cycle
Timing the Cycle 1 2013 – 2015: Strong freight market 2 2016 – Q1 2019: Poor freight market 3 Recovery in 2019. Now: volatile market Baltic avg. TCE: USD 67,300/day Baltic avg. TCE: USD 17,000/day Today’s market level: USD 45,000/day 27 owned VLGC’s with an average age of Contract coverage
Slide 13: Innovation & Technology
Innovation & Technology At the forefront of future opportunities 13
Slide 14: LPG Propulsion - Operational and Financial Benefits
LPG Propulsion - Operational and Financial Benefits Operational Financial Deck tanks enable a return 10% and 15% lower voyage between the US and consumption vs compliant fuel China running on LPG and scrubbers Eliminates about 4 days of LPG gives unlevered IRR of bunkering time per year 15%
Slide 15: Smart Ship – Increased control through technology
Smart Ship – Increased control through technology Each Vessel is fitted with over 3,000 sensors Real-time monitoring of Vessel performance including emissions Improved fuel Enhanced Reduced human operational Reduced risk of consumption error with greater efficiency and injury and cargo automation
Slide 16: Environmental Leadership
Environmental Leadership 1 First mover – First LPG ship on water Innovation by working closely with leading engine manufactures MAN and Wartsila 2 Reuse – Retrofit rather than newbuild 50% of the current VLGC fleet can be converted to LPG dual fuel New builds produce 35x more carbon emissions
Slide 17: Finance Update
FINANCE UPDATE
Slide 18: Snapshot of Financial Position
Snapshot of Financial Position Low cash break even and a solid balance sheet….. Net profit break even levels 1 Low cash breakeven and OPEX 23000 2020 Cash break even for owned fleet at USD 20,500 per day 21,836 22000 21,605 OPEX H1 2020 of USD 7,400 per day USD per day 20,852 21000 20,501 20,003
Slide 19: Snapshot of Financial Position – cash generation and dividends
Snapshot of Financial Position …….gives high cash generation and dividends Strong EBITDA through the cycle 1 Strong cash generation 500 Generated USD 300m of free cash flow in 1H 2020 400 LPG propulsion capex for 2020 funded with 80% leverage 300 USD millions 200 430 399 2 Quarterly dividends pa
Slide 20: Why invest in BW LPG?
Why invest in BW LPG? 1 Clear ESG investment story Charting a sustainable future We are the driving force in reducing fuel emissions LPG transport – improving lives Saving lives 2 Market leading profitability Highest returns amongst peers with a ROE of 37% last 12 months Good value support.
Slide 21: Investor Relations
Investor Relations [email protected] Telephone +65 6705 5588 Ticker BWLPG Linkedin https://sg.linkedin.com/company/bwlpg Address 10 Pasir Panjang Road Mapletree Business City #17-02 Singapore 117438 21