Stolt-Nielsen Limited · OSL:SNI
Stolt-Nielsen — Q3 2009 Earnings Presentation
37 slides from Stolt-Nielsen's earnings presentation, Oct 6, 2009
Slide 1: Third-Quarter 2009 Results Conference Call
Stolt-Nielsen S.A. Third-Quarter 2009 Results Conference Call October 6, 2009
Slide 2: Forward-Looking Statements
Forward-Looking Statements Included in this presentation are various “forward-looking statements”, including statements regarding the intent, opinion, belief or current expectations of the Company or its management with respect to, among other things, (i) goals and strategies, (ii) plans for new dev
Slide 3: Company Representatives
Company Representatives • Niels G. Stolt-Nielsen – CEO Stolt-Nielsen S.A. • Jan Chr. Engelhardtsen – CFO Stolt-Nielsen S.A. Page 3
Slide 4: Agenda
Agenda • Stolt-Nielsen S.A. 3Q09 Highlights – Stolt Tankers – Stolthaven Terminals – Stolt Tank Containers – Stolt Sea Farm • Market Situation and Outlook • Financial Results, Capital Expenditures and Liquidity Situation • Q&A Page 4
Slide 5: SNSA: Third-Quarter 2009 Highlights
SNSA: Third-Quarter 2009 Highlights • Third-quarter net profit up 11% from second quarter • Tankers & Terminals showed improved operating results for the quarter; Tank Containers saw margins squeezed • The market outlook remains uncertain • Cancellation of hull #474, the second of four 44,000 dwt co
Slide 6: SNSA: Third-Quarter 2009 Highlights
SNSA: Third-Quarter 2009 Highlights • Improved operating results in Tankers due to the increased demand in China and other Asian markets driven by the impact of the economic stimulus programme and continuing inventory re-stocking Operating • Improved operating results also in Terminals due to increa
Slide 7: SNSA: 2Q09 to 3Q09 Net Profit Variance
SNSA: 2Q09 to 3Q09 Net Profit Variance Figures in USD Millions $45 $2.1 $12.5 $40 $0.8 ($5.2) $35 ($5.2) $30.9 $30 ($1.8) $27.7 $25 $20 $15 $10 $5 $0 2Q09 Net Profit * Higher Tankers Higher Terminals Low er Tank Higher Sea Farm Change in IFRS fair Change in FX, Tax 3Q09 Net Profit * operating profit
Slide 8: Stolt Tankers
Stolt Tankers $US Millions $US Millions REVENUE GROSS PROFIT 400 60 50 300 40 200 30 356.2 56.3 322.5 46.2 246.8 244.4 270.2 20 100 33.8 10 18.6 22.2 0 0 3Q08 4Q08 1Q09 2Q09 3Q09 3Q08 4Q08 1Q09 2Q09 3Q09 $US Millions Days OPERATING PROFIT STJS - OPERATING DAYS 7,000 50 6,000 40 5,000 4,000 30 3,000
Slide 9: Stolt Tankers: 2Q09 to 3Q09 Operating Profit Variance
Stolt Tankers: 2Q09 to 3Q09 Operating Profit Variance Figures in USD Millions $16 $1.3 $1.0 $14.2 $14 $5.5 ($0.9) $12 $8.6 $10 $8 $4.3 $6 $4 $6.3 $1.7 $2 $0 -$2 -$4 ($13.6) -$6 2Q09 Higher trading Higher bunker Higher bunker Lower loss on Change in Lower Lower equity Other 3Q09 Operating results cos
Slide 10: Stolt Tankers: Bunker Costs
Stolt Tankers: Bunker Costs • Bunker costs increase of $9.3M from previous quarter • Bunker hedge loss for the quarter was $11.1M • By the end of August 2009 we had hedged 62,000 tons for the next six months (11% of the total estimated annual consumption) at an average contract price of $478/ton; at
Slide 11: Stolt Tankers: Bunker Hedge Sensitivity
Stolt Tankers: Bunker Hedge Sensitivity • Price of $405/ton at quarter-end Quarter Projected 1Q09 2Q09 3Q09 4Q09 1Q10 Volume (in tons) 46,000 42,000 42,000 45,000 17,000 Bunker hedge (loss) / gain ($15.6) M ($15.4) M ($11.1) M ($6.5) M $2.0 M Page 11
Slide 12: Stolt Tankers – What's Happening…
Stolt Tankers – What’s Happening… • Increased demand in China and other Asian markets driven by the impact of the economic stimulus programme • Weak dollar and low natural gas prices have made US exports more competitive resulting in the increase in volume shipped from the US into Asia • Return volu
Slide 13: Stolt Tankers Joint Service Sailed-in T/C Index
Stolt Tankers Joint Service Sailed-in T/C Index Index (1st Quarter 1990 = 1.0) 1.6 3Q95 = 1.48 3Q09* = 1.20 Global Recession Asia Pacific economic 1.4 crisis and large newbuilding programmes Sept.11 1.2 Global economic downturn starts 1 First Gulf war Strong Asia growth Strong CPP inventory build an
Slide 14: Freight Rate History
Freight Rate History Houston - Far East Rotterdam - Far East Rate ($/MT) Rate ($/MT) 130 130 120 120 110 110 100 100 90 90 80 80 70 70 60 60 50 50 40 40 30 30 20 20 July July July Jul Jul Jul Jul Jul Jul Jul Jul Jul Jul Jul Jul Jul Jul Jan Jan Jan'93 Jan'94 Jan'95 Jan'96 Jan'97 Jan'98 Jan'99 Jan'00
Slide 15: Orderbook for the Major Parcel Tanker Operators
Orderbook for the Major Parcel Tanker Operators DWT (in ‘000 MT) Cumulative DWT (in ‘000 MT) 17,000 1,700 1,500 Uncertainty continues about how many of Orderbook = 24.5% of the newbuildings on order will be delivered existing fleet 1,300 12,000 1,100 900 700 7,000 500 300 100 2,000 -100 Expected rec
Slide 16: STJS Pool Development: 2008 Year-end to 3Q09
STJS Pool Development: 2008 Year-end to 3Q09 Service Number of Ships DWT • Deep sea 69 2,055,851 • Ships delivered (newbuildings) 2 87,043 • Ships recycled (4) (138,386) 9.7% decrease • Ships redelivered (T/C’s) (7) (139,744) • SNICS ship removed from STJS (1) (8,080) 59 1,856,684 Information as of
Slide 17: Newbuildings to Be Delivered Through 2013
Newbuildings to Be Delivered Through 2013 SNSA Operator Yard DWT 2009 2010 2011 2012 Total K-43 SNSA SLS Shipbuilding 43,000 0 2 3 3 8 N-43 SNSA STX Norway Florø AS 43,000 1 1 0 0 2 K-6 SNSA Xinshun 5,900 0 2 0 0 2 1 5 3 3 12 JV Companies Owner Operator Yard DWT 2009 2010 2011 2012 Total Gulf Stolt
Slide 18: Stolthaven Terminals
Stolthaven Terminals $US Millions $US Millions REVENUE GROSS PROFIT 35 18 30 15 25 12 20 9 15 30.2 31.7 15.0 28.8 28.1 29.1 13.7 6 12.7 12.5 10 10.4 3 5 0 0 3Q08 4Q08 1Q09 2Q09 3Q09 3Q08 4Q08 1Q09 2Q09 3Q09 $US Millions Million of Barrels - (owned terminals) OPERATING PROFIT BARREL CAPACITY - UTILIS
Slide 19: Terminals: 2Q09 to 3Q09 Operating Profit Variance
Terminals: 2Q09 to 3Q09 Operating Profit Variance Figures in USD Millions $16 $2.6 $0.9 $14.0 $14 ($0.2) ($1.2) $11.9 $12 $10 $8 $6 $4 $2 $0 2Q09 Operating Profit Higher operating revenue Higher operating Higher profit contribution Other 3Q09 Operating Profit expenses from JVs Page 19
Slide 20: Stolthaven Ningbo: Expected Operational In 4Q09
Stolthaven Ningbo: Expected Operational In 4Q09 Page 20
Slide 21: Stolt Tank Containers
Stolt Tank Containers $US Millions $US Millions REVENUE GROSS PROFIT 140 30 120 24 100 80 18 29.3 29.7 60 116.8 124.6 26.2 25.2 105.6 109.9 12 24.9 102.9 40 6 20 0 0 3Q08 4Q08 1Q09 2Q09 3Q09 3Q08 4Q08 1Q09 2Q09 3Q09 $US Millions OPERATING PROFIT 28,000 SHIPMENTS - UTILISATION 100% 21 18 21,000 80% 1
Slide 22: STC: 2Q09 to 3Q09 Operating Profit Variance
STC: 2Q09 to 3Q09 Operating Profit Variance Figures in USD Millions $25 $4.4 $20 $18.4 ($5.0) $15 $13.2 ($4.2) ($0.4) $10 $5 $0 2Q09 Operating Profit Higher operating revenue Higher ocean freight Higher inland freight Other 3Q09 Operating Profit costs costs Page 22
Slide 23: Stolt Sea Farm
Stolt Sea Farm $US Millions $US Millions REVENUE GROSS PROFIT 24 8 20 16 6 12 4 18.1 8 5.9 12.6 11.7 12.2 11.9 2 4 2.1 3Q08 0.9 0.6 0 0 3Q08 4Q08 1Q09 2Q09 3Q09 (1.6) 4Q08 1Q09 2Q09 3Q09 (2) $US Millions % OPERATING PROFIT * GROSS OPERATING MARGIN 50% 8 40% 6 4.9 4.2 4 30% 4.0 48.0% 2 1.8 1.7 20% 1.
Slide 24: SSF: 2Q09 to 3Q09 Operating Profit Variance
SSF: 2Q09 to 3Q09 Operating Profit Variance Figures in USD Millions $6.0 $5.0 $4.9 ($0.5) $4.0 $3.0 $2.0 $0.5 $1.0 $0.9 $0.5 ($3.6) $0.0 ($1.7) -$1.0 2Q09 Operating Profit Turbot Gross Profit Turbot IFRS fair value Caviar Gross Profit Caviar IFRS fair value A&G and other 3Q09 Operating Profit revalu
Slide 25: Industrial Production: Have We Turned The Corner?
Industrial Production: Have We Turned The Corner? US Industrial Production UK Industrial Production Germany Industrial Production China Industrial Production (% change) Source: Bloomberg Page 25
Slide 26: Our View of The Global Economic Outlook
Our View of The Global Economic Outlook • While there are some signs of a global economic recovery, we continue to question the speed of the recovery and the time it will take to go back to normal levels of volume • More losses expected to be taken by the banks resulting in continued constrained cre
Slide 27: What Are We Doing?
What Are We Doing? Actions Outcomes • Critical review of all capex and deferring non- • Cancelled new buildings, deferred new projects, essential projects reduced delegated authority • YTD 3Q09: Recycled four ships, net redelivered • Adjusting asset portfolio to a lower demand seven T/C ships; Net f
Slide 28: Financials
Financials Page 28 Ri
Slide 29: Net Profit
Net Profit Figures in USD Millions Quarter Nine Months 3Q09 2Q09 3Q08 2009 2008 Stolt Tankers $14.2 $1.7 $39.6 $13.4 $106.5 Stolthaven Terminals 14.0 11.9 9.7 35.4 28.4 Stolt Tank Containers 13.2 18.4 12.9 44.5 34.1 Stolt Sea Farm 0.5 4.9 (3.1) 6.5 7.8 SNSA Corporate and Other (2.6) (1.7) (11.5) (5.
Slide 30: Balance Sheet and Key Financial Metrics
Balance Sheet and Key Financial Metrics Figures in USD Millions (Except ratios) At the end of: Aug-09 Financial debt covenants Debt (Including Guarantees) $1,333 Tangible Net Worth (TNW) $1,449 Minimum TNW of $600M Debt:TNW 0.92:1 Maximum Debt : TNW of 2:1 EBITDA / Interest expense 10.5:1 Minimum EB
Slide 31: Administrative and General Expenses
Administrative and General Expenses Figures in USD Millions Revised Quarterly Quarter Nine Months Guidance 3Q09 2Q09 3Q08 2009 2008 Stolt Tankers $20.5 $21.4 $23.1 $63.6 $70.9 $22.0 Stolthaven Terminals 4.0 3.8 4.8 11.8 13.9 4.0 Stolt Tank Containers 12.2 11.4 12.2 37.2 34.4 12.0 Stolt Sea Farm 0.2
Slide 32: Depreciation and Amortisation
Depreciation and Amortisation Figures in USD Millions Revised Quarterly Quarter Nine Months Guidance 3Q09 2Q09 3Q08 2009 2008 Stolt Tankers $25.6 $24.8 $20.9 $73.8 $65.1 $25.5 Stolthaven Terminals 3.6 3.4 3.5 10.3 9.8 4.1 Stolt Tank Containers 3.7 5.2 3.2 14.1 9.5 4.4 Stolt Sea Farm 0.7 0.8 1.086 2.
Slide 33: Taxes and Share of Profit of JVs
Taxes and Share of Profit of JVs Figures in USD Millions Taxes Revised Quarterly Quarter Nine Months Guidance 3Q09 2Q09 3Q08 2009 2008 Tankers, Terminals and T. Containers $3.4 $3.2 $2.6 $9.2 $6.9 $2.3 Stolt Sea Farm (0.3) $1.4 $1.0 1.2 5.5 (0.4) SNSA Corporate $1.4 $0.2 (0.3) 2.2 $0.9 0.3 Total Tax
Slide 34: Capital Expenditures Programme: $0.8 Bn Remaining
Capital Expenditures Programme: $0.8 Bn Remaining Figures in USD Millions Actuals Projected Capital Outlays Total Remaining YTD 3Q '09 Remaining 2010 2011 2012 2013 Stolt Tankers $173 $49 $44 $95 $126 $213 $52 $530 Stolthaven Terminals 24 7 12 24 14 14 15 $79 Stolt Tank Containers 4 2 4 20 3 3 3 $33
Slide 35: SLS Situation: Coated and SS Ships
SLS Situation: Coated and SS Ships Coated ships • The first two ships scheduled for delivery in May 2008 and September 2008 have been cancelled due to excessive delays and are now in arbitration • The third and fourth ships in the series are also experiencing substantial delays. We may cancel shortl
Slide 36: Summary
Summary Market • There are early signs of a global economic recovery but we expect it to be slow • 2010 and 2011 are likely to be challenging years for chemical shipping SNSA • Strong market position as a global industrial service provider • Stable revenue base (70% COA’s) • Strong balance sheet wit
Slide 37: Thank You
Thank You For more information please visit our website: www.stolt-nielsen.com Page 37