Wallenius Wilhelmsen

Quarterly Report • May 11, 2021

Highlights Q1 2021

Science Based Target to guide our climate actions

27.5%

Reduction CO2e intensity from Shipping by 2030*

Our sustainability objectives

Orcelle Wind - at a glance

• Wind as main propulsion, reducing emissions by up to 90%
• Based on established 'Oceanbird' concept
• Target: design ready for contracting yard by mid-2022
• Status: project and evaluation proceeding as planned

Agenda

Business update

Market update

Financial performance

Outlook and Q&A

Business update

Torbjørn Wist, CFO and Acting CEO

Erik Nøklebye, EVP & COO Shipping Services

Introducing three new segments to improve transparency in reporting

SHIPPING SERVICES

Share of EBITDA*

Highlights

• Brands WW Ocean, EUKOR, Armacup
• Worldwide deep-sea transportation network
• Main customers are manufacturers of auto, high&heavy, break-bulk

Share of EBITDA*

• Main brands WW Solutions, VSA, Keen, Syngin, ALS
• Terminals
• Inland distribution networks
• Vehicle and equipment processing centers
• Same customers as Shipping

LOGISTICS SERVICES GOVERNMENT SERVICES

Highlights Share of EBITDA*

Highlights

• RoRo shipping cargo, breakbulk, vehicles
• Logistics services incl. stevedoring
• Primary customer US government

Shipping services volumes improved 14% YoY, though down 3% QoQ

Shipping services volumes and cargo mix

• Recovery in volumes driven by positive underlying demand trend
• Trade pattern imbalance, with strong volumes ex-Asia and weak ex-Europe
• Normalized cargo mix (H&H share) of 28.3%
• Unprorated volumes (loaded onto vessels during Q1) were on par with Q4 20, up 13% YoY

1) Total volume based on prorated volume in Shipping services (ex. Government services), i.e. volumes are split between months based on the sailing period onboard the vessel

2) H&H share calculated based on unprorated volumes, i.e. volumes loaded onto vessels during the quarter

All vessels to be reactivated from cold layup, as rising volumes and trade pattern imbalance led to continued pressure on capacity

Fleet capacity

• Eight vessels re-entered service from cold layup during Q1, remaining eight to be reactivated during 2021
• Continued to utilize short term charter market in Q1
• One vessel was recycled in January
• Final newbuilding scheduled for delivery in Q3 21
• Scrubber installations to be finalized for fleet in Q3 21, 11 vessels total

¹Vessels in cold layup include Owned and Chartered vessels

²20 vessels were reclassified from leased assets to owned assets effective from 01/01/2020

Market update

Erik Nøklebye

EVP & COO Shipping Services

Light vehicle sales continue to recover – up 19% YoY

Pent-up demand, incentives and solid Chinese sales fuel the light vehicle recovery

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The recovery marches on in High & Heavy markets – up 15% YoY

Still improving momentum with rock solid fundamentals in commodity exposed segments

Source: ¹ IHS Markit | World construction & agriculture equipment exports (avg. equipment value >20 kUSD ) (Units last 3 months, YoY) per Feb 2021. Feb 2021 data are limited to countries (62% of total) having reported customs data as per 03.05.2021 ²Parker Bay | Large Mining Equipment Deliveries (Units last quarter YoY) ³Factset Data and Analytics (03.05.2021) | OEM sales consensus estimates per calendar year (USD). Constituents: Volvo, Caterpillar, CNH, Komatsu, Hitachi, Deere, Terex, Doosan, Sandvik, Epiroc and AGCO. Estimates include sales in construction/mining/agriculture equipment divisions only.

Tight tonnage situation has led to limited recycling. Orderbook at low levels

Financial performance

Torbjørn Wist

CFO and Acting CEO

Financial highlights – Q1 2021

Shipping and Government EBITDA under pressure in Q1

• QoQ EBITDA down due to higher net fuel cost and ramp-up costs due to pressure on fleet operations and global supply-chains
• YoY EBITDA slightly down du to capacity costs, offsetting positive revenue development

• QoQ EBITDA slightly up thanks to strong H&H activity in Americas
• YoY EBITDA up on all sub-segments, with recovery from early Covid19 period

Government – EBITDA (adjusted)¹ USDm

• QoQ EBITDA down due to timing of cargo, partially offset by lower SG&A and vessel opex
• YoY EBITDA slightly down with lower activity in cargo offset by lower net fuel costs and lower vessel opex

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U

S

D

m

EBITDA down 12% QoQ, as increased fuel cost and ramp-up costs outweigh revenue improvement

• Shipping services lower:
  • Fuel cost up on higher price and consumption
  • Fuel surcharge lagging
  • Volume effect netted out by improved cargo and trade mix
  • Profitability per CBM weakened by ramp-up costs
• Logistics services develop flat
• Government services lower activity in Q1

Undrawn credit facilities

Cash

Cash and undrawn credit facilities down USD 83m QoQ

Working capital increased with activity and loan payments resumed at normal pace

* Includes change in net pension assets/liabilities

Installments (bank loans and leases)

Solid balance sheet and strong liquidity position

COMMENTS

• Equity ratio at 34.3%
• Net debt at USD 3.5bn
• Debt maturities in 2021 under control with cash on hand
  • Refinancing of USD 52m concluded in Q1
  • USD 50m committed for final newbuild

Prospects

Torbjørn Wist

CFO and acting CEO

Prospects

• The markets have recovered significantly since last year
• We expect the supply-demand balance to remain favourable mid-term
• Potential risks from further disruptions to global supply chains, fleet capacity constraints and virus intensity
• Stabilizing market conditions will provide more financial flexibility going forward

Q&A