Stolt-Nielsen Limited · OSL:SNI
Stolt-Nielsen — Q4 2018 Earnings Presentation
34 slides from Stolt-Nielsen's earnings presentation, Jan 31, 2019
Slide 1: Fourth-Quarter 2018 Results
Fourth-Quarter 2018 Results January 31, 2019
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: Stolt-Nielsen Limited Representatives
Stolt-Nielsen Limited Representatives • Niels G. Stolt-Nielsen Chief Executive Officer • Jens F. Grüner-Hegge Chief Financial Officer Page 3
Slide 4: Agenda
Agenda • SNL 4Q18 Highlights – Stolt Tankers – Stolthaven Terminals – Stolt Tank Containers – Stolt Sea Farm – Stolt-Nielsen Gas • Financials • Q&A Page 4
Slide 5: Fourth-Quarter 2018 Highlights
Fourth-Quarter 2018 Highlights • Stolt Tankers reported an operating profit of $7.7m, down from $21.4m, mainly reflecting lower freight revenue combined with higher bunker fuel costs, and a $4.1m loss on bunker hedges, compared with a $1.3m gain in the prior period. • Stolthaven Terminals reported a
Slide 6: SNL: 3Q18 to 4Q18 Net Profit Variance
SNL: 3Q18 to 4Q18 Net Profit Variance Figures in US$ Millions Note: Net Profit attributable to equity holders of SNL Page 6
Slide 7: Stolt Tankers – Challenging Market Conditions
Stolt Tankers – Challenging Market Conditions REVENUE GROSS PROFIT 60 350 45 280 US $ Millions US$ Millions 210 30 308.6 312.4 48.9 140 282.8 295.1 303.0 40.7 42.0 34.4 15 29.7 70 0 0 4Q17 1Q18 2Q18 3Q18 4Q18 4Q17 1Q18 2Q18 3Q18 4Q18 OPERATING PROFIT STJS – OPERATING DAYS 30 7,000 US$ Millions 20 Da
Slide 8: Tankers: 3Q18 to 4Q18 Operating Profit Variance
Tankers: 3Q18 to 4Q18 Operating Profit Variance Figures in US$ Millions Page 8
Slide 9: Stolt Tankers: Bunker Costs
Stolt Tankers: Bunker Costs Figures in US$ Million Figures in US$ Million Realised Unrealised Total Hedge Period G/(L) G/(L) G/(L) FY17 7.4 6.1 13.5 1Q18 2.8 (3.1) (0.3) 2Q18 3.0 6.3 9.3 3Q18 4.4 (3.1) 1.3 4Q18 4.2 (8.2) (4.1) FY18 14.4 (8.1) 6.2 Future swaps Volume (MT) Average Fair Market Value (U
Slide 10: 2020: Low Sulphur Fuel Regulations
2020: Low Sulphur Fuel Regulations • Effective January 1, 2020, all ships must consume low-sulphur fuel (0.5%, down from 3.5% today). • Fuel options are either 0.1% MGO or new 0.5% fuels (we are testing some today; they are priced at “MGO less discount”, not “IFO plus premium”; availability, quality
Slide 11: ST Joint Service Sailed-in TC Index and Sensitivity
ST Joint Service Sailed-in TC Index and Sensitivity Stolt Tankers Joint Service Sailed-in T/C Index Source: Stolt-Nielsen and the Bureau of Labor Statistics (U.S. CPI) Index based on SIR STJS ships + net result outside T/C ships, base is 1Q96 + adjusting for inflation based on US Consumer Price Inde
Slide 12: Chemical Tanker Fleet and Orderbook – 4Q18
Chemical Tanker Fleet and Orderbook – 4Q18 20 3.0% DWT as % of toal current fleet 2.5% 16 2.0% Vessel Addition 12 1.5% 8 1.0% 4 0.5% 0 0.0% 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 E 2Q19 E 3Q19 E 4Q19 E Source: Stolt-Nielsen and Drewry, as of January 1, 2019 Competitor criteria: i) IMO 2 ships between 15,000
Slide 13: Stolt Tankers Market Development
Stolt Tankers Market Development • We see demand growing 4% p.a. based on SPECIALTY (1,000 MT) GDP growth forecasts, though possible tariffs 180 brings downside risk. 160 • Core chemical deep-sea fleet growth will slow 140 from ~6% in 2017-2019 to 2% or less in 2020- 120 2021 as NB deliveries are co
Slide 14: Stolthaven Terminals – Steady Results
Stolthaven Terminals – Steady Results REVENUE GROSS PROFIT 24 60 18 US$ Millions US$ Millions 12 22.0 23.9 62.5 63.9 62.6 63.0 22.2 22.2 61.4 18.8 50 6 40 0 4Q17 1Q18 2Q18 3Q18 4Q18 4Q17 1Q18 2Q18 3Q18 4Q18 Note: Excludes $8.4M Impairment of NZ terminal in 4Q17 and $6.1m impairment of assets in 4Q18
Slide 15: Terminals: 3Q18 to 4Q18 Operating Profit Variance
Terminals: 3Q18 to 4Q18 Operating Profit Variance Figures in US$ Millions Page 15
Slide 16: Stolthaven Terminals: Market Update & Key Initiatives
Stolthaven Terminals: Market Update & Key Initiatives • Strong market fundamentals in the USA allowing for rate escalation at both Houston and New Orleans, although uncertainty remains on US trade policy and its potential impact on product flows. • Singapore market remains challenging; currently wor
Slide 17: Stolt Tank Containers – Market Softened
Stolt Tank Containers – Market Softened REVENUE GROSS PROFIT 150 35 28 100 US$ Millions US$ Millions 21 136.9 132.5 143.2 141.8 133.6 33.1 33.4 34.9 34.5 33.3 50 14 7 0 4Q17 1Q18 2Q18 3Q18 4Q18 0 4Q17 1Q18 2Q18 3Q18 4Q18 24 OPERATING PROFIT SHIPMENTS - UTILISATION 42,000 100% 18 35,000 US$ Millions
Slide 18: STC: 3Q18 to 4Q18 Operating Profit Variance
STC: 3Q18 to 4Q18 Operating Profit Variance Figures in US$ Millions ` Page 18
Slide 19: Stolt Sea Farm
Stolt Sea Farm REVENUE 30 GROSS PROFIT a) 5 25 4 20 US$ Millions US$ Millions 3 15 23.3 23.7 24.4 25.6 24.9 3.9 2 3.8 4.1 10 2.8 5 1 1.6 0 0 4Q17 1Q18 2Q18 3Q18 4Q18 4Q17 1Q18 2Q18 3Q18 4Q18 OPERATING 3 PROFIT a) 2.5 US$ Millions 2 1.5 2.2 2.4 1 2.1 0.5 0.9 0 0.1 4Q17 1Q18 2Q18 3Q18 4Q18 a) Excludes
Slide 20: SSF: 3Q18 to 4Q18 Operating Profit Variance
SSF: 3Q18 to 4Q18 Operating Profit Variance Figures in US$ Millions ` Page 20
Slide 21: Stolt-Nielsen Gas – Avenir LNG Ltd
Stolt-Nielsen Gas – Avenir LNG Ltd • SNL announced the formation of Avenir LNG, a joint venture with Golar and Höegh LNG, with a combined commitment to invest up to $182.0m. • The three partners contributed $99.0m on October 1, 2018. • On November 13, $11.0 million was raised in a private placement
Slide 22: Financials
Financials Page 22
Slide 23: Net Profit
Net Profit Figures in US$ Millions Quarter YTD 4Q18 3Q18 4Q17 2018 2017 Operating Profit (before one-offs) $41.7 $54.6 $45.5 $206.6 $204.9 Gain / (loss) on sale of assets (0.8) 0.2 0.9 (1.3) (0.5) Impairment of Stolthaven and Bitumen (12.0) - (15.3) (26.4) (16.8) US DB pension plan & medical insuran
Slide 24: Balance Sheet
Balance Sheet Figures in US$ Millions Period ended Nov.30.18 Figures in US$ Millions (Except ratios) At the end of: Cash and cash equivalents $65 November 2018 Receivables 244 Other current assets 176 Debt $2,392 Total current assets 485 Tangible Net Worth (TNW) $1,615 Debt:TNW 1.48:1 Property, plan
Slide 25: Cash Flow
Cash Flow Figures in US$ Millions Quarter Full Year 4Q18 3Q18 2018 Net profit $3 $2 $54 Depreciation, amortisation and non-cash items 69 83 274 Adjustment to deferred tax - - - Changes in working capital 15 (5) 3 Cashflow Priorities: Other receipts, net (5) 19 (3) Net cash generated by operating act
Slide 26: EBITDA
EBITDA $S$ Millions US$ Millions TANKERS TERMINALS 80 14% 40 14% 78 35 74 72 73 69 68 70 11% 35 11% 60 65 67 30 32 33 63 30 31 29 30 30 29 55 25 28 28 8% 8% 40 48 20 23 5% 15 5% 20 10 2% 2% 5 0 -1% 0 -1% 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4
Slide 27: Capital Expenditures Programme
Capital Expenditures Programme Figures in USD Millions Figures in US$ Millions Projected Actual Projections Total 2018 2019 2020 2021 2022 2023 Stolt Tankers $41 $40 $25 $9 $7 $4 $85 Stolthaven Terminals 85 112 42 25 25 23 $227 Stolt Tank Containers 5 24 3 - - - $27 Stolt Sea Farm 8 28 4 5 7 7 $52 S
Slide 28: Debt Maturity Profile
Debt Maturity Profile Figures in US$ Millions 600 500 400 300 200 100 0 2019 2020 2021 2022 2023 Amortisation of Senior Debt Balloon Payment Bonds Note: • $374m drawn under the revolver as of November 30, 2018 Page 28
Slide 29: Financial Key Metrics
Financial Key Metrics DEBT / TANGIBLE NET WORTH EBITDA / INTEREST EXPENSE NET DEBT / EBITDA FREE CASH FLOW DIVIDEND PER SHARE Page 29
Slide 30: Administrative & General Expenses
Administrative & General Expenses Figures in US$ Millions Updated Quarterly Quarter YTD Guidance 4Q18 3Q18 4Q17 2018 2017 Stolt Tankers $22.5 $21.5 $23.2 $90.2 $90.3 $21.8 Stolthaven Terminals 11.4 11.0 10.4 44.8 42.5 11.5 Stolt Tank Containers 16.8 16.3 16.7 67.4 64.0 17.0 Stolt Sea Farm 1.9 1.7 1.
Slide 31: Depreciation and Amortisation
Depreciation and Amortisation Figures in US$ Millions Updated Quarterly Quarter YTD Guidance 4Q18 3Q18 4Q17 2018 2017 Stolt Tankers $40.5 $45.1 $42.8 $174.7 $169.7 $40.8 Stolthaven Terminals 13.2 14.5 14.6 53.5 55.2 13.5 Stolt Tank Containers 6.1 6.1 7.9 24.5 27.8 6.3 Stolt Sea Farm 1.9 1.5 1.8 6.4
Slide 32: Share of Profit of JVs and Tax
Share of Profit of JVs and Tax Figures in US$ Millions Share of Profit of JVs Updated Quarterly Quarter YTD Guidance 4Q18 3Q18 4Q17 2018 2017 Stolt Tankers $0.4 $1.0 $2.5 $2.9 $7.4 $1.0 Stolthaven Terminals 4.1 5.8 4.5 31.5 19.7 6.0 Tank Containers 0.4 0.6 0.3 1.7 1.2 - Corporate and Other (0.4) (0.
Slide 33: IFRS 16 Update
IFRS 16 Update • Implementation starts from December 1, 2019, therefore we will start including the new standard from our 1Q20 results • Since we are following the modified retrospective approach there will be no restatement of prior years • Balance Sheet impact: – Higher debt from lease liabilities
Slide 34: Key Takeaways
Key Takeaways • A net profit of $54.9m for the year 2018, compared with $50.3m in 2017 • Tanker market remains challenging; we expect an uplift in the market later in 2019 with MR rates starting to increase, less NB activity and lower fuel cost • Solid performance at Stolthaven Terminals • Market so