Annual General Meeting 29 April 2015

Transcription

1 First Ship Lease Trust Annual General Meeting 29 April 2015

2 2014: Year in review Outlook Recent developments Summary Questions & Answers

3 US$ million 2014: Key milestones Relaxation extension until 31 Dec 14 agreed 35 Feb 2014 Mar 2014 Jun 2014 Aug 2014 Dec 2014 Dec 2014 Sale of dry bulk vessels Secured FSL Shanghai contract with Tesoro First quarterly profit in 2 ½ years Legal settlement agreed Compliance with original loan agreement covenants achieved Q Q Q Q 2014 Cash generated from operations Cash balance After five months of negotiations with its banks First Ship Lease Trust (FSL Trust) has secured relaxation of its loan covenants until the end of Seatrade Global 3 March

4 US$ million 2014: Key milestones 35 Feb 2014 Mar 2014 Jun 2014 Aug 2014 Dec 2014 Dec 2014 Relaxation extension until 31 Dec 14 agreed Sale of dry bulk vessels Secured FSL Shanghai contract with Tesoro First quarterly profit in 2 ½ years Legal settlement agreed Compliance with original loan agreement covenants achieved Q Q Q Q 2014 Cash generated from operations Cash balance First Ship Lease Trust (FSL Trust) has sold two dry bulk carriers this transaction marks the exit of the dry bulk market for the company Seatrade Global 19 March

5 US$ million 2014: Key milestones 35 Feb 2014 Mar 2014 Jun 2014 Aug 2014 Dec 2014 Dec 2014 Relaxation extension until 31 Dec 14 agreed Sale of dry bulk vessels Secured FSL Shanghai contract with Tesoro First quarterly profit in 2 ½ years Legal settlement agreed Compliance with original loan agreement covenants achieved Q Q Q Q 2014 Cash generated from operations Cash balance First Ship Lease has secured improved period employment for one of its crude tankers the deal marks a $1.6m rise over the previous annual cheque it collected for the ship. Tradewinds 30 June

6 US$ million 2014: Key milestones 35 Feb 2014 Mar 2014 Jun 2014 Aug 2014 Dec 2014 Dec 2014 Relaxation extension until 31 Dec 14 agreed Sale of dry bulk vessels Secured FSL Shanghai contract with Tesoro First quarterly profit in 2 ½ years Legal settlement agreed Compliance with original loan agreement covenants achieved Q Q Q Q 2014 Cash generated from operations Cash balance First Ship Lease Trust has posted its first quarterly profit in nearly three years, an indication that the Singapore-listed trust is getting back on track after an overhaul of its management team. Lloyd s List Asia 14 August

7 US$ million 2014: Key milestones 35 Feb 2014 Mar 2014 Jun 2014 Aug 2014 Dec 2014 Dec 2014 Relaxation extension until 31 Dec 14 agreed Sale of dry bulk vessels Secured FSL Shanghai contract with Tesoro First quarterly profit in 2 ½ years Legal settlement agreed Compliance with original loan agreement covenants achieved Q Q Q Q 2014 Cash generated from operations Cash balance 7

8 US$ million 2014: Key milestones 35 Feb 2014 Mar 2014 Jun 2014 Aug 2014 Dec 2014 Dec 2014 Relaxation extension until 31 Dec 14 agreed Sale of dry bulk vessels Secured FSL Shanghai contract with Tesoro First quarterly profit in 2 ½ years Legal settlement agreed Compliance with original loan agreement covenants achieved Q Q Q Q 2014 Cash generated from operations Cash balance FSL Trust is back in compliance with the terms of a December 2011 loan agreement the development seems to vindicate the strategy pursued by the management team around chief executive Alan Hatton, which took over the reins following the mass boardroom departure in Lloyd s List Asia 6 January

9 2014: Financial highlights Revenue Net cash generated from operations Net profit Results from operating activities (US$ million) 9

10 US$ million 2014: Revenue development Bareboat charter equivalent revenues 73 Aframaxes US$72m US$70m 25 Vessels Disposal of dry-bulk Feeder vessels charter expiry MR2 Currency swaps and FX TORM Chemical tankers 23 Vessels Revenues improved despite reduction in fleet size 10

11 2014: Fleet deployment by revenue (1) Floating rate BBC 11% Pool/RSA 15% Fixed rate BBC 65% Time charter 9% Note 1: BBCE revenue for the 12-months ended 31 December

12 2014: Gearing and value-to-loan analysis Rebased outstanding loan and fleet value Gearing and Value-to-loan (VTL) development 105% 60% +10% +10% 100% 95% 59% 58% 57% 59% +6% +9% +8% +7% +6% 90% 85% Value accretion 56% 55% 54% 53% +4% 57% 54% +5% +4% +3% +2% +1% 80% Q Q Q % Q Q Q % Rebased loan balance Rebased fleet value Value-to-loan % increase Gearing Value accretion through fleet appreciation and debt pay down that led to a better gearing and an improved VTL ratio 12

13 US$/day Operational performance and market trend Dry Dry Bulk bulk MR MR Container feeder Container feeder Aframax Aframax Stainless-steel teel chemical tanker (3 vessels) 2.5 (100%) (10%) (32%) % % Handymax market 10-year trend 80% 60% 40% 20% 0% (20%) (40%) (60%) (80%) Source: Marsoft 6% 19% 61% (56%) (2%) 12% (18%) (29%) 17% (6%) ,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 - Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

14 US$/day Operational performance and market trend Dry Dry Bulk bulk MR MR Container feeder Container feeder Aframax Aframax Stainless-steel teel chemical tanker (3 vessels) 2.5 (100%) (10%) (32%) % % MR tanker market 10-year trend 40% 30% 20% 10% 0% (10%) (20%) (30%) (40%) (50%) 7% 7% 15% (19%) (33%) 1% (8%) (39%) 28% 13% ,000 30,000 25,000 20,000 15,000 10,000 5,000 Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average Source: Marsoft - LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

15 US$/day Operational performance and market trend Dry Dry Bulk bulk (100%) Feeder Containership market 10-year trend 60% 25,000 MR MR Feeder container Container feeder (10%) 6.2 (32%) 40% 20% 0% (20%) (40%) (5%) (9%) 14% (29%) (48%) 49% (5%) (37%) 10% (15%) 20,000 15,000 10,000 5,000 Aframax Aframax % (60%) Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average Source: Marsoft Stainless-steel teel chemical tanker (3 vessels) % LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

16 US$/day Operational performance and market trend Dry Dry Bulk bulk MR MR Feeder container Container feeder Aframax Aframax Stainless-steel teel chemical tanker (3 vessels) 2.5 (100%) (10%) (32%) % % Aframax tanker market 10-year trend 60% 40,000 40% 35,000 30,000 20% 7% 8% 12% 1% 25% 19% 25,000 0% 20,000 (20%) (17%) (34%) (12%) (37%) 15,000 10,000 (40%) 5,000 (60%) Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average Source: Marsoft LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

17 US$/day Operational performance and market trend Dry Dry Bulk bulk (100%) Chemical tanker market 10-year trend 30% 25,000 MR MR Feeder container Container feeder (10%) 6.2 (32%) 20% 10% 0% (10%) (20%) 9% (6%) 14% (14%) (12%) (10%) (12%) 3% (0%) 20,000 15,000 10,000 5,000 Aframax Aframax % (30%) (27%) Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average Source: Marsoft Source: Marsoft Stainless-steel teel chemical tanker (3 vessels) % LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

18 US$/day Operational performance and market trend Dry Dry Bulk bulk MR MR Feeder container Container feeder Aframax Aframax Stainless-steel teel chemical tanker (3 vessels) 2.5 (100%) (10%) (32%) % % LR2 tanker market 10-year trend 50% 40% 30% 20% 10% 0% (10%) (20%) (30%) (40%) (50%) Source: Marsoft 5% 10% 1% (12%) (37%) (1%) (23%) (26%) 11% 43% ,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 - Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average LR2 LR % Source: Marsoft Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

19 US$/day Operational performance and market trend Dry Dry Bulk bulk MR MR Feeder container Container feeder Aframax Aframax Stainless-steel teel chemical tanker (3 vessels) 2.5 (100%) (10%) (32%) % % Specialised tanker market 10-year trend 60% 8,000 7,000 40% 6,000 20% 5,000 26% 2% 0% 12% 25% 0% 4,000 (12%) (47%) (1%) (25%) (2%) 3,000 (20%) 2,000 (40%) 1,000 (60%) Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average Source: Marsoft LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Container Panamax Container Panamax (5 vessels) % (US$ million) FY 2013 FY

20 US$/day Operational performance and market trend Dry Dry Bulk bulk MR MR Feeder container Container feeder Aframax Aframax Stainless-steel teel chemical tanker (3 vessels) 2.5 (100%) (10%) (32%) % % Panamax containership market 10-year trend 80% 50,000 60% 40% 40,000 20% 17% 60% 30,000 0% (20%) (10%) (5%) (14%) (57%) (15%) (36%) (16%) (5%) 20,000 (40%) (60%) 10,000 (80%) Vessel Y-o-Y % value increase (decrease) 1Y TCE Rate Last 10Y TCE average Source: Marsoft LR2 LR % Specialised tanker Specialised tanker (7 vessels) % Panamax Container containership Panamax (5 vessels) % (US$ million) FY 2013 FY

21 2014: Year in review Outlook Recent developments Summary Questions & Answers

22 One-year TC (US$/day) FSL Trust exposure: Panamax containers 50,000 40,000 30,000 20,000 FSLT s TCE US$25,000/day 10, E Source: Marsoft Short-term rate expansion driven by US west-coast strikes Significant market oversupply of vessels FSL tonnage has secured income until

23 One-year TC (US$/day) FSL Trust exposure: Feeder containers 20,000 15,000 10,000 5, E Source: Marsoft Interesting market demonstrating recent rate improvements As container markets move to a more hub and spoke model, benefits could be seen FSL exposure two vessels in spot related pool 23

24 One-year TC (US$/day) FSL Trust exposure: Chemical tankers 20,000 15,000 10,000 5, E Source: Marsoft Niche market, high barriers of entry Steady growth in chemicals business demand and new chemical plants FSL Exposure three chemical tankers in spot pool 24

25 One-year TC (US$/day) FSL Trust exposure: Product tankers 40,000 30,000 20,000 10, E Source: Marsoft MR LR2 Rates strengthening in 2015 Increasing demand for refined petroleum products Expansion of Asian & Middle Eastern refineries FSL Exposure Two MR vessels on time charter (to be redelivered in 2015) Two LR2 vessels in spot-related BBC 25

26 One-year TC (US$/day) FSL Trust exposure: Aframax crude oil tankers 40,000 30,000 20,000 10, E Source: Marsoft Freight rates showing continued strength Longer voyages expected as refineries import more oil and Asian countries build up reserves due to low oil price FSL Exposure FSL Hong Kong on two-year TC starting May 2015 FSL Shanghai on one-year time charter (to be redelivered in July 2015) 26

27 Lease portfolio Product Tanker Containership Crude Oil Tanker Chemical Tanker Cumbrian Fisher Clyde Fisher Shannon Fisher Solway Fisher Speciality Seniority Superiority TORM Margrethe TORM Marie FSL Hamburg FSL Singapore Ever Radiant Ever Respect YM Eminence YM Elixir YM Enhancer FSL Busan FSL Santos FSL Hong Kong FSL Shanghai FSL New York FSL London FSL Tokyo Fixed-rate time charter Feeder containership pool with HANSE Fixed-rate time charter Fixed-rate time charter Chemical tanker pool with Nordic Tankers Market-rate time charter Vessels on fixedrate bareboat charters Vessels on fixedrate bareboat charters Potential extension Base 27

28 Revenue backlog Remaining contracted revenue stood at US$157 million (1) as at 31 March Years: Note 1: Based on revenue from 12 bareboat charters (excluding the TORM charters on variable rates) and from time charter contracts with Tesoro (FSL Shanghai and FSL Hong Kong) and Petrobras which are on fixed-rate time charters 28

29 2014: Year in review Outlook Recent developments Summary Questions & Answers

30 US$ million Unit Price (SGD cents) Performance update Apr 2015 Secured two-year TC contract on FSL Hong Hong Apr 2015 SGD19.3 cents (+SGD12.4 cents) (+179.7%) Mar 2014 SGD6.9 cents 1Q Q Q Q Q 2015 Results to be announced 8 6 Cash generated from operations Cash balance Unit price 30

31 7 Apr 15 8 Apr 15 9 Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Apr Unit buy-back strategy Market capitalisation and unit price SGD million 130 SGD cents 20 Board and Management believes the units are undervalued Bought back 6,017,200 units (0.92%) Total cost of units bought back is S$975,789 (US$733,174) Since 1 Jan 2015, market capitalisation has improved by SGD$57.1 million (US$42.9 million) and 83.9% Last 12-month average daily trading volume of 670,000 units Last one-month average daily trading volume of 2,373,500 units Market capitalisation Units closing price 31

32 2014: Year in review Outlook Recent developments Summary Questions & Answers

33 Heading in the right direction Significant progress achieved in the past 12 months Trust is compliant with its loan covenants for first time since 2012 Returned to full-year revenue growth in 2014 despite smaller fleet Returned to full-year profitability for the first time since 2009 Significantly reduced indebtedness and gearing Focus going forward will be on ensuring future covenant compliance, improving revenues and delivering unitholder value 33

34 2014: Year in review Outlook Recent developments Summary Questions & Answers