Investor Presentation • Aug 18, 2021
Investor Presentation
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COMPANY PRESENTATION | Q2 2021 August 2021
| Q2 2021 |
Q2 2020 | ||||
|---|---|---|---|---|---|
| Average TCE USD 18 031/day |
Average TCE USD 6 927/day |
||||
| EBITDA USD 36.0m |
EBITDA USD 1.9m |
||||
| Net result USD 22.5m |
Net result USD -14.6m |
||||
| Financial position | |||||
| Assets | Equity and liabilities | ||||
| Owned ships USD 203.8m |
Equity USD 203.9m (38%) |
||||
| Leased ships USD 179.4m |
Mortgage loans USD 123.2m |
||||
| Cash and cash equivalents | Lease liabilities |
USD 156.1m
Other liabilities USD 56.0m
USD 63.4m
Other assets USD 92.6m
Uniform Ultramax fleet
Market cap increased by 12x
Lighthouse Navigation was established in 2009 and is the commercial arm of Belships ASA providing chartering and operations with a long track record of positive results. The commercial operations and operating activities have expanded and is now present in Bangkok, Oslo, Singapore and Melbourne. Lighthouse is also the commercial manager of seven handysize vessels owned by SFL Corporation Ltd.
Profitable every year since its inception in 2009
More than 70 vessels managed during the quarter
Present in 4 countries with over 80 employees
Hands-on approach with leading employees invested
Average age of vessels
Purchase options on 55% of fleet No purchase obligations on any vessels
Ultramax: BSI58 plus 10% premium. BSI58 is BSI52 plus \$293 per day prior to 2015 Kamsarmax: BPI82 2018-2021, BPI74 plus \$1 300 day prior to 2018 Capesize: BCI 5TC 2014-2021, BCI 4TC prior to 2014
| BELSHIPS ASA | 7
8
| Ultramax | Supramax | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Vessel | Built | DWT | Yard | Ownership | |||||
| BELYAMATO (NEWBUILD) | 2022 | 64,000 | Imabari | TBD1 | |||||
| BELTOKYO (NEWBUILD) | 2021 | 64,000 | Imabari | BB-in2 | max | ||||
| max Ultra 24 x |
BELFORCE (NEWBUILD) | 2021 | 61,000 | Dacks | BB-in3 | pra | |||
| BELKNIGHT (NEWBUILD) | 2021 | 61,000 | Dacks | BB-in4 | Su 3x |
||||
| BELTRADER | 2021 | 61,000 | Dacks | BB-in5 | |||||
| BELGUARDIAN | 2021 | 61,000 | Dacks | BB-in5 | 1) | On delivery 2H 2022 | |||
| BELMAR (NEWBUILD) |
2021 | 64,000 | Imabari | BB-in6 | |||||
| BELFAST | 2021 | 64,000 | Imabari | BB-in7 | |||||
| BELAJA | 2020 | 61,000 | Shin Kurushima |
BB-in8 | |||||
| BELMOIRA | 2020 | 61,000 | Shin Kurushima | BB-in8 | |||||
| BELFUJI | 2020 | 63,000 | Imabari | TC-in9 | |||||
| BELRAY | 2019 | 61,000 | Shin Kurushima | BB-in10 | 12) | Delivered Q3 2021 | |||
| BELNIPPON | 2018 | 63,000 | Imabari | TC-in11 | |||||
| BELHAVEN | 2017 | 63,000 | Imabari | Owned | |||||
| BELTIGER | 2017 | 63,000 | New Times | Owned12 | |||||
| BELISLAND | 2016 | 61,000 | Imabari | BB-in13 | |||||
| BELLIGHT | 2016 | 63,000 | New Times | Owned | |||||
| BELINDA | 2016 | 63,000 | Hantong | Owned | |||||
| BELMONT | 2016 | 63,000 | Hantong | Owned | |||||
| BELATLANTIC | 2016 | 63,000 | Hantong | Owned | |||||
| BELHAWK (TO BE DELIVERED) | 2015 | 61,000 | Imabari | BB-in14 | |||||
| BELFOREST | 2015 | 61,000 | Imabari | BB-in15 | |||||
| BELPAREIL | 2015 | 63,000 | Hantong | Owned | |||||
| BELSOUTH | 2015 | 63,000 | Hantong | Owned |
| Vessel | Built | DWT | Yard | Ownership | ||
|---|---|---|---|---|---|---|
| max pra Su 3x |
BELOCEAN | 2011 | 58,000 | Dayang | Owned | |
| BELNOR | 2010 | 58,000 | Dayang | Owned | ||
| BELSTAR | 2009 | 58,000 | Dayang | Owned | ||
| BELCARGO | 2008 | 58,000 | Tsuneishi | Owned17 | ||
| BELFRI | 2007 | 55,000 | Kawasaki | Owned16 |
2) On delivery 2H 2021 12 years bareboat charter with purchase options after fourth year
3) On delivery 2H 2021 10 years bareboat charter with purchase options after third year
4) On delivery 2H 2021 7 years bareboat charter with purchase options after third year
5) Delivered Q3 2021 10 years bareboat charter with purchase options after fourth year
6) On delivery 2H 2021 10 years bareboat charter with purchase options after fourth year
7) Delivered Q1 2021 10 years bareboat charter with purchase options after fourth year
8) 7 years bareboat charter with purchase options after fourth year 9) 8 years time charter with purchase options after fourth year
10) 7 years bareboat with purchase options after fourth year
11) 8 years time charter with purchase options after fourth year
12) Delivered Q3 2021
13) 11 years bareboat charter with purchase options after third year
14) On delivery 2H 2021 9.5 years bareboat charter with purchase options after third year
15)12 years bareboat charter with purchase options after third year
16) Sold with expected delivery to buyer in September/October 2021
17) Sold with expected delivery to buyer in October/November 2021
The group has no purchase obligations on any of the lease agreements
2021
CORONA (COVID-19) – Port closures and vessel waiting times especially in Asia are causing fleet inefficiencies which is adding to the tight market dynamics. Economies are continuing to recover after last year historical dip and pent-up demand is driving the market. Manufacturing PMI has rebounded strongly and is currently indicating continued growth.
CARGO – The rally in commodity markets since the beginning of the year has resulted in the strongest first half year in a decade for dry cargo markets. Import figures for most regions are showing growth in terms of volumes – evidencing a widespread demand recovery. Iron ore prices peaked at record levels in Q2 and guided volumes ex Brazil for the upcomoing 12 months are strong which should support the freight market next year. Grain exports from Europe has significantly increased demand for ships in the Atlantic basin. The disruptions in the container markets are creating certain spill over effects as some cargo typically transported in containers are now being shipped in bulk carriers.
ORDERBOOK/SUPPLY - The publicly quoted order book for the Supra/Ultramax segment is below 6 per cent – historically very low. In relative terms, we are heading towards the lowest rate of supply growth in 30 years. The average sailing speed has increased, showing that the market has been able to absorb this inherent fleet supply during a sharp increase in spot rates. This is an important indicator of a stronger market sentiment.
STIMULUS AND ECONOMIC GROWTH – Continued credit growth and economic stimulus is expected to support the dry bulk market in 2022-23 as the effects of fiscal stimulus usually lags about 12-24 months. Seaborne iron ore is predominantly driven by Chinese demand whereas minor bulks tend to correlate closer with GDP. GDP has rebounded in 2021. General consensus points towards healthy levels of economic activity for 2022.
MARKET PROSPECTS – The market outlook is strong and sentiment for 2022 and 2023 have been revised upwards. With the rate of growth on the supply side diminishing and post-COVID-19 normalisation now occuring in tandem with a wider commodity rally it appears that the stars are aligning for the dry bulk market in 2021-22. Ship values have started to increase sharply. However, significant upside remains if ship values are to reflect rates and values according to historical correlations.
42 per cent of available ship days in the next four quarters are booked at about USD 22 441 net per day
Cash flow from operations in 2021 given freight rates
Proven track record – growth delivered
Simple structure, low costs and governance leader
More than 55% of the fleet with purchase options – no obligations
High operational leverage providing significant upside and dividend capacity
Infrastructure boom ahead of lowest orderbook in 30 years
This presentation has been prepared by Belships ASA (the "Company") exclusively for information purposes. This presentation is confidential and may not be copied, distributed, reproduced, published or passed on, directly or indirectly, in whole or in part, or disclosed by any recipient, to any other person (whether within or outside such person's organisation or firm) or published in whole or in part, by any medium or in any form for any purpose or under any circumstances.
The information in this presentation speaks as of 18 August 2021 and the Company assumes no obligation to amend, correct or update the information in this presentation. None of the Company or any of their respective directors, officers, employees, agents, affiliates, advisors or any person acting on their behalf, shall have any liability whatsoever, (whether direct or indirect, in contract, tort or otherwise) for any loss whatsoever arising from any use of this presentation, or otherwise arising in connection with this presentation.
The contents of this presentation shall not be construed as legal, business or tax advice, and the furnishing of this presentation should not be considered as the giving of investment advice by the Company or any of its directors, officers, agents, employees or advisers. Prospective investors should consult its own legal, business or tax advisor as to legal, business or tax advice.
This presentation contains certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words "believes", expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", and similar expressions. The forward-looking statements contained in this presentation, including assumptions, opinions and views of the Company or cited from third party sources are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. None of the Company or subsidiaries or any such person's directors, officers or employees provides any assurance that the assumptions underlying such forward-looking statements are free from errors nor does any of them accept any responsibility for the future accuracy of the opinions expressed in this presentation or the actual occurrence of the forecasted developments.
This presentation has been prepared for information purposes only, and does not constitute or form part of, and should not be construed as, any offer, invitation or recommendation to purchase, sell or subscribe for any securities in any jurisdiction and neither the issue of the information nor anything contained herein shall form the basis of or be relied upon in connection with, or act as an inducement to enter into, any investment activity.
This presentation is subject to Norwegian law and any dispute arising in respect of this presentation is subject to the exclusive jurisdiction of Norwegian courts with Oslo district court as legal venue.
| Q2 | Q2 | YTD Q2 | YTD Q2 | ||
|---|---|---|---|---|---|
| USD 1 000 | 2021 | 2020 | 2021 | 2020 | 2020 |
| Gross freight revenue Note |
165,691 | 37,873 | 272,981 | 87,348 | 220,332 |
| Voyage expenses | -27,006 | -10,764 | -59,360 | -28,556 | -61,065 |
| Net freight revenue 2 |
138,685 | 27,109 | 213,621 | 58,792 | 159,267 |
| Management fees | 1,719 | 1,508 | 3,172 | 3,381 | 6,095 |
| Operating income 2 |
140,404 | 28,617 | 216,793 | 62,173 | 165,362 |
| Share of result from j/v and assoc. comp. | 1,723 | 742 | 2,483 | 1,315 | 3,052 |
| T/C hire expenses | -88,253 | -14,692 | -134,925 | -30,275 | -90,401 |
| Ship operating expenses | -9,550 | -9,467 | -20,365 | -19,368 | -38,675 |
| Operating expenses management companies | -6,953 | -2,689 | -10,916 | -5,612 | -11,861 |
| General and administrative expenses | -1,404 | -638 | -2,373 | -1,507 | -3,491 |
| Operating expenses | -104,437 | -26,744 | -166,096 | -55,447 | -141,376 |
| EBITDA | 35,967 | 1,873 | 50,697 | 6,726 | 23,986 |
| Depreciation and amortisation 3 |
-6,313 | -7,699 | -13,853 | -14,427 | -27,286 |
| Impairment 3 |
0 | -4,868 | 0 | -4,868 | -4,957 |
| Gain on sale of ships | 0 | 0 | 0 | 2,469 | 2,469 |
| Other gains/(-losses) 6 |
-5 | -598 | -6,739 | 2,338 | 1,165 |
| Operating result (EBIT) | 29,649 | -11,292 | 30,105 | -7,762 | -4,623 |
| Interest income | 212 | 257 | 431 | 507 | 985 |
| Interest expenses | -3,325 | -3,410 | -6,841 | -7,049 | -13,668 |
| Other financial items | -196 | -152 | -344 | -376 | -729 |
| Currency gains/(-losses) | 99 | 82 | -148 | 354 | 875 |
| Net financial items | -3,210 | -3,223 | -6,902 | -6,564 | -12,537 |
| Result before taxes | 26,439 | -14,515 | 23,203 | -14,326 | -17,160 |
| Taxes | -3,951 | -70 | 15,792 | -107 | -583 |
| Net result | 22,488 | -14,585 | 38,995 | -14,433 | -17,743 |
| Hereof majority interests | 15,565 | -13,896 | 30,479 | -13,896 | -19,898 |
| Hereof non-controlling interests | 6,923 | -689 | 8,516 | -537 | 2,155 |
| Earnings per share | 0.09 | -0.07 | 0.16 | -0.06 | -0.08 |
| Diluted earnings per share | 0.09 | -0.07 | 0.16 | -0.06 | -0.08 |
| 30 Jun | 30 Jun | 31 Dec | ||
|---|---|---|---|---|
| USD 1 000 | 2021 | 2020 | 2020 | |
| NON-CURRENT ASSETS | Note | |||
| Intangible assets | 17,074 | 3,053 | 1,770 | |
| Ships, owned | 3 | 203,790 | 225,803 | 214,494 |
| Ships, right-of-use assets | 3 | 179,400 | 159,176 | 157,143 |
| Prepayment of lease obligations on ships | 12,210 | 0 | 3,000 | |
| Property, Plant, and Equipment | 4,836 | 4,372 | 4,878 | |
| Investments in j/v and assoc. companies | 4,176 | 2,995 | 2,123 | |
| Other non-current assets | 2,553 | 13,937 | 5,394 | |
| Total non-current assets | 424,039 | 409,336 | 388,802 | |
| CURRENT ASSETS | ||||
| Asset held for sale | 0 | 0 | 5,917 | |
| Bunkers | 12,220 | 7,235 | 5,344 | |
| Current receivables | 39,586 | 6,697 | 30,431 | |
| Cash and cash equivalents | 63,363 | 34,363 | 33,985 | |
| Total current assets | 115,169 | 48,295 | 75,677 | |
| Total assets | 539,208 | 457,631 | 464,479 | |
| EQUITY AND LIABILITIES | ||||
| Equity | ||||
| Paid-in capital | 154,319 | 137,705 | 137,962 | |
| Retained earnings | 36,499 | 11,861 | 5,956 | |
| Non-controlling interests | 13,115 | 3,850 | 6,099 | |
| Total equity | 203,933 | 153,416 | 150,017 | |
| Non-current liabilities | ||||
| Mortgage debt | 4 | 108,924 | 133,376 | 119,561 |
| Lease liability | 5 | 145,510 | 133,106 | 127,754 |
| Other non-current liabilities | 2,247 | 2,355 | 2,769 | |
| Total non-current liabilities | 256,681 | 268,837 | 250,084 | |
| Current liabilities | ||||
| Mortgage debt | 4 | 14,268 | 10,368 | 22,176 |
| Lease liability | 5 | 10,590 | 8,841 | 11,986 |
| Other current liabilities | 53,736 | 16,169 | 30,216 | |
| Total current liabilities | 78,594 | 35,378 | 64,378 | |
| Total equity and liabilities | 539,208 | 457,631 | 464,479 | |
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