Epic Gas · 2018. 2. 14. · This Presentation (hereinafter collectively referred to as the...
Transcript of Epic Gas · 2018. 2. 14. · This Presentation (hereinafter collectively referred to as the...
Epic Gas FYE 2017
Earnings Presentation14 February 2018
This Presentation (hereinafter collectively referred to as the “Presentation”) has been produced by Epic Gas Ltd. (the “Company”, or “Epic”) for
information purposes only.
This Presentation contains information obtained from third parties. As far as the Company is aware and able to ascertain from the information
published by that third party, no facts have been omitted that would render the reproduced information inaccurate or misleading. To the best of the
knowledge of the Company, the information contained in this Presentation is in all material respects in accordance with the facts as of the date
hereof. However, no independent verifications have been made and no representation or warranty (express or implied) is made as to, and no
reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is
accepted as to any errors, omissions or misstatements contained herein, and, accordingly, none of the Company or any of its parent or subsidiary
undertakings or any such person’s officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document.
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 any of its parent or subsidiary
undertakings or any such person’s 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. The Company assumes no obligation, except as required by law, to update any forward-looking
statements or to conform these forward-looking statements to our actual results.
2
Disclaimer
Fiscal Year 2017 Highlights
3
Revenue of $139.5 million, up 8% year over year
General & Administrative expenses of $1,006 per vessel
calendar day, down 2.2% year over year
Adjusted EBITDA of $29.4 million, up 14% year over year
Net Loss of $18.0 million before a non-cash impairment
charge on goodwill of $12.9 million
Time Charter Equivalent revenues of $8,210 per vessel
calendar day, up 1% year over year
Vessel Calendar days up 8% year over year to 14,946 days
Fleet: as of 31 December 2017, 41 vessels on the water
Vessel Supply
4
329
211
84
380
6
7
14
49
0
100
200
300
400
500
3k - 13k 3k - 13k 13k - 25k +25k
PR SR (incl Eth) SR (incl Eth) FR (incl Eth)
Nu
mb
er
of
Ve
sse
ls
On Water On Order
Smaller LPG Vessels have Smallest Order Book(Chinese Fleet Excluded)
-20%
0%
20%
40%
60%
80%
-50,000
0
50,000
100,000
150,000
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
20
18
3,000 - 4,999cbm 5,000 - 6,999cbm 7,000 - 8,999cbm
9,000 - 13,000cbm Scrapped Expected Scrapping
YoY growth (right axis)
Pressure Vessel Global Fleet Development
• 6 newbuild pressure vessels to be delivered in 2018 and 2019 representing a 1.8% increase in existing fleet capacity• 7 newbuild small-sized semi-ref vessels to be delivered representing a 3.3% increase in existing fleet capacity• 2 pressure and 12 small-sized semi-ref vessels average age 28 years scrapped in 2017• 11 pressure and 18 semi-ref vessels aged 28 years and over
Demand - Global Trade and Drivers
5
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17
Ton
ne
s
Ethane Propane Butane IsoButane
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Jan
-15
Feb
-15
Mar
-15
Ap
r-1
5
May
-15
Jun
-15
Jul-
15
Au
g-1
5
Sep
-15
Oct
-15
No
v-1
5
Dec
-15
Jan
-16
Feb
-16
Mar
-16
Ap
r-1
6
May
-16
Jun
-16
Jul-
16
Au
g-1
6
Sep
-16
Oct
-16
No
v-1
6
Dec
-16
Jan
-17
Feb
-17
Mar
-17
Ap
r-1
7
May
-17
Jun
-17
Jul-
17
Au
g-1
7
Sep
-17
Oct
-17
No
v-1
7
Dec
-17
(TONNES)
China India
80.2
88.1
91.9
95.1
70
75
80
85
90
95
100
2015 2016 2017 2018 est.
Mill
ion
To
nn
es
Global Seaborne Trade
Global LPG seaborne2017: +4.3% year on year growth
USA LPG exports2017: +23.6% year on year growth
India and China LPG imports2017: +14% year on year growth
Demand - Regional Trade
2,641
3,048
2,771
2,903
3,099
2,400
2,900
3,400
0
1,000
2,000
3,000
4,000
5,000
6,000
2013 2014 2015 2016 2017
Pro
pyl
ene
Imp
ort
s (0
00
's M
T)
Year
En
d P
DH
Cap
acit
y (0
00
's M
T)
Year End PDH Capacity Chinese Propylene Imports
0
20,000
40,000
60,000
80,000
100,000
Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17
(To
nn
es)
Carib Cargo Qty C. Amer Cargo Qty
Med Cargo Qty WAF Cargo Qty
SR (<12k cbm) Total Cargo Qty
PRESSURE CARGOES OUT OF THE US
0%
25%
50%
75%
100%
Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17
Korea Japan Taiwan Thailand Philippines Indonesia Malaysia Others
Million Tonnes 2015 2016 2017
Turkey 3.5 3.6 3.7
Egypt 3.0 3.1 3.1
Morocco 1.9 2.1 2.2
Spain 1.0 1.2 1.3
Imports into Turkey, Morocco and Spain +2.8% to +8.3%.USA pressurised LPG exportsQ4’17: +30% from Q3’17
China’s Propylene imports record high 3.1 million tonnes, +6.8% year on year, despite +16% domestic PDH capacity, Tonne Mile growth in 2017 due increase of propylene cargoes out of Thailand, Philippines and Indonesia
6
12 Month Time Charter Market (US$/day)
7
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
Jan
-08
…
Jan
-09
…
Jan
-10
…
Jan
-11
…
Jan
-12
…
Jan
-13
…
Jan
-14
…
Jan
-15
Jan
-16
Jan
-17
Jan
-18
3,500cbm-Steem 1960 5,000cbm-Steem 1960 7,500cbm-Grieg, Gibsons, BRS 11,000cbm-Epic
Q4 20173,500cbm, 5,000cbm, 7,500cbm & 11,000cbm market daily rates averaged $7,714, $9,329, $10,000 and $13,075 respectivelyAverage rates +30% for 3,500cbm & 5,000cbm, -1.9% for 7,500cbm vessels, flat for 11,000cbm compared to Q4 2016
Epic Gas Operations - Global
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2,277,555
554,480
Tonnes Transported in 2017
LPG Petchems
Asia39%
Middle East2%
Europe34%
Africa11%
Americas14%
Global Trading
Vessels by Segment Americas EMEA Asia Total Fleet
3,300 – 4,100cbm 2 1 5 8
5,000 – 6,300cbm 1 3 7 11
7,000 – 7,500cbm 1 11 2 14
9,500cbm - 1 1 2
11,000cbm - 2 4 6
Total 4 18 19 41
Fleet Capacity (cbm) 273,100
Average Size (cbm) 6,661
2017, the Epic Gas Year:• Loaded 2.8 million tonnes • 2,486 cargo operations• 266 different ports• 2.3 million tonnes LPG (80%)• 0.5 million tonnes petchems
(20%)• 4 vessels operating in the
Americas, 18 in the Europe/Middle East/Africa, 19 in Asia.
Epic Gas Operations – Ship to Ship (STS)
9
0
25
50
75
100
125
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2016 2017
Off Singapore Off Male W. Africa
Uruguay Carib Others
Epic Gas Ship-to-Ship (STS) Operations Heat Map
- 413 ship-to-ship operations in 2017
- 26 different countries
- 209% of the operations in 20162014 2015 2016 2017
No. STS Ops 24 108 198 413
Operations by Region
Operating Metrics
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Average number of vessels in period (1) 37.3 41.2 37.6 40.9
Number of vessels as of period end 38 41 38 41
Fleet capacity at period end (cbm) 239,400 273,100 239,400 273,100
Gas fleet average size as of period end 6,300 6,661 6,300 6,661
Fleet calendar days 3,436 3,788 13,748 14,946
Time charter days 2,188 2,562 9,116 10,584
Spot market days 837 1,176 3,376 3,744
COA days 270 - 824 101
Voyage days (2) 3,295 3,738 13,316 14,428
Fleet utilisation (3) 95.9% 98.7% 96.9% 96.5%
Fleet operational utilisation (4) 93.0% 94.4% 93.4% 92.0%
Time charter equivalent earnings (5)
Per Calendar Day $8,206 $8,449 $8,095 $8,210
Per Voyage Day $8,556 $8,563 $8,365 $8,505
Operating expenses per Calendar Day $4,336 $4,172 $4,233 $4,176
1) The number of days each vesselwas a part of our fleet during theperiod divided by the number ofcalendar days.2) Calendar days net of off-hiredays associated with major repairs,dry dockings or special orintermediate surveys.3) Calculated by dividing voyagedays by fleet calendar days.4) Calculated by dividing voyagedays, excluding commercially idledays, by fleet calendar days.5) Calculation of time charterequivalent earnings provided inSupplemental Information
Three Month Period
Ended December 31,
Twelve Month Period
Ended December 31,
2016 2017 2016 2017
Income Statement and Cash Flow FY2017
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Time Charter Equivalent (“TCE”) Revenue and Opex
Voyage Days
All amounts in $ millions FY2016 FY2017
Cash from operating activities 3.5 16.3 Cash from investing activities (95.9) (39.7) Cash from financing activities 58.7 20.5
Net Increase in cash and cash equivalents (33.7) (2.8) Cash and cash equivalents at the beginning of the year 43.5 9.8
Cash and cash equivalents at the end of the period 9.8 7.0
$70.2
$96.6
$116.8$111.4
$122.7
$8,403 $8,521 $8,682
$8,095 $8,210
$4,243 $4,105 $4,103 $4,233 $4,176
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
$-
$20
$40
$60
$80
$100
$120
$140
FY2013 FY2014 FY2015 FY2016 FY2017
TCE
Rev
enu
e p
er C
alen
dar
Day
TCE
Rev
enu
e ($
mill
ion
s)
TCE Revenue TCE per Calendar Day Vessel Opex per Calendar Day
8,144
11,171
13,210 13,316 14,428
13.5%
31.1%
16.6%
25.4% 25.9%
0%
20%
40%
60%
80%
100%
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
FY2013 FY2014 FY2015 FY2016 FY2017
Per
cen
t o
f V
oya
ge D
ays
in S
po
t M
arke
t
Vo
yage
Day
s
TC Days Spot Days % Spot
Three Month Period Ended December 31,
Twelve Month Period Ended December 31,
All amounts in $ millions 2016 2017 2016 2017
Revenue 33.0 37.3 128.8 139.5
Address and brokerage commissions 0.8 0.8 3.1 3.3 Voyage expenses 4.5 5.1 15.6 15.5 Vessel operating expenses 14.9 15.8 58.2 62.4 Charter-in costs 3.2 4.1 13.4 16.0 Depreciation and amortization 6.9 7.4 24.6 29.3 Impairment loss/loss on sale of vessels 9.9 0.0 9.9 0.0 Impairment of Goodwill 0.0 12.9 0.0 12.9 General and administrative expenses 3.5 3.7 14.0 15.0
Total expenses 43.8 49.8 139.0 154.4
Operating income (10.9) (12.5) (10.2) (15.0)
Other (income) / losses, net 1.3 (0.5) (1.1) (1.8) Finance expenses 3.7 4.3 13.8 17.2
Profit/(loss) before tax (15.8) (16.3) (22.9) (30.4)
Income tax expense 0.1 0.1 0.4 0.5
Profit/(loss) after tax (15.9) (16.4) (23.3) (30.9)
Other Comprehensive income: Cash flow hedges gain/(loss) (7.0) 1.1 0.8 0.5
Total Comprehensive Income/(Loss) (22.9) (15.4) (22.5) (30.4)
Balance Sheet 31 December 2017
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All amounts in $ millions As of
31 Dec 2016 As of
31 Dec 2017
ASSETS Cash and cash equivalents 9.8 7.0 Trade and other receivables 21.6 24.3 Inventories 3.3 4.3 Derivative financial instruments 0.4 0.8
Current assets 35.1 36.4
Non-current assets 0.2 0.1
Restricted cash deposits 12.2 13.5 Property, plant and equipment 487.4 524.5 Advances for vessels under construction 26.5 0.0 Intangible assets 12.9 0.0
Non-current assets 539.2 538.1
TOTAL ASSETS 574.3 574.5
LIABILITIES AND SHAREHOLDERS’ EQUITY Trade and Other Payables 18.9 24.5 Deferred income 6.6 9.0 Current income tax liabilities 0.4 0.6 Derivative liabilities 0.0 0.0 Finance lease liabilities 7.2 9.5 Bank Loan 27.8 31.7
Current liabilities 60.8 75.4
Deferred taxation 0.1 0.0 Finance lease liabilities 53.8 44.3 Bank Loan 218.1 210.9
Non-current liabilities 272.1 255.2
Total Liabilities 332.9 330.6
Share capital 308.3 340.1
Share option reserves 2.8 3.9 Accumulated losses (69.8) (100.8) Other Reserves 0.2 0.7
Total Equity 241.4 243.9
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 574.3 574.5
Dec-17 Dec-18 Dec-19 Dec-20
ABN/CA/NIBC 69.3 64.2 59.1 54.0
ABN/DVB/Nord LB 78.0 61.1 48.8 38.8
CIT 50.7 43.7 expires
NIBC 7.8 6.6 5.4 4.2
CTL 19.2 18.0 16.9 15.7
Japanese Owner 19.7 18.8 17.8 16.8Finance Lease Balta, Bolivar, Burano 19.2 13.0 expires
Finance Lease Bali, Borneo 35.7 32.4 28.9 25.2
Total 299.6 257.8 176.9 154.7
• Asset valuesBook value of $525m in line with broker FMV estimates
• Low gearing Refinancing of 14 vessels/$90m completed in Q1 2017. No expiring facilities until 2019. Net borrowings/total assets of 50%.
• Japanese Bareboat Charter back In July 2017, Epic Gas entered into a sale and 10-year bareboat charter back transaction for the Epic Salina (11,000cbm, 2017 built) with a Japanese ship owning company, resulting in decreased finance cost .
• Loan Profile
Summary and Outlook
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Summary FYE 2017
41 vessels on the water, total capacity 273,100cbm, average size 6,661cbm, average age 7.7 years
Fleet Operational Utilisation 92%, TCE $8,210 per calendar day and $8,505 per voyage day
Operating Expenses $4,176 and General & Administrative expenses $1,006 per calendar day
As of 31st December 2017, 39% covered for the year 2018 at an average daily TCE rate of $8,988
Outlook
Freight levels for 3,500/5,000cbm continue to improve due lack of incremental capacity and ongoing demand growth
Market is gradually absorbing 7,500/11,000cbm, utilisation improving, with 1.7% net fleet growth expected for 2018
Potential scrapping in the pressurised and semi-ref LPG ship sector
Limited order book for the sector – 6 pressure and 7 semi-ref (including ethylene carriers)
Infrastructure development in demand centres
The Epic Gas Fleet
Epic Gas Fleet List
Vessel: 3,300-4,100 cbm Built Yard Vessel: 7,200-7,500 cbm Built Yard
Epic Catalina 3,500 2007 Kanrei Epic Borkum 7,200 2000 Murakame Hide
Epic Cobrador* 3,500 2009 Kanrei Epic Barbados 7,200 2001 Murakame Hide
Epic Cordova* 3,500 2009 Kanrei Epic Bermuda 7,200 2001 Murakame Hide
Epic Corsica 3,500 2009 Kanrei Epic Barnes 7,200 2002 Murakame Hide
Epic Caledonia 3,500 2014 Kitanihon Epic Bali 7,200 2010 Kyokuyo
Epic Curacao 3,500 2014 Kitanihon Epic Borneo 7,200 2010 Kyokuyo
Epic Campbell* 4,100 2001 Higaki Epic Bell* 7,200 2014 Kyokuyo
Epic Corfu* 4,100 2000 Watanabe Epic Bird* 7,200 2014 Kyokuyo
Sub Total 8 Vessels 29,200 cbm Epic Bolivar 7,500 2002 Shin Kurushima
Epic Burano 7,500 2002 Watanabe
Epic Boracay 7,500 2009 Murakame Hide
Epic Borinquen 7,500 2016 Sasaki
Epic Bonaire 7,500 2016 Sasaki
Epic Baluan 7,500 2017 Sasaki
Sub Total 14 Vessels 102,600 cbm
Vessel: 5,000-6,300 cbm cbm Built Yard Vessel: 9,500 cbm cbm Built Yard
Epic St. John 5,000 1998 Higaki Epic Madeira 9,500 2006 Miura
Epic St. George 5,000 2007 Shitanoe Mayfair 9,500 2007 Miura
Epic St. Kitts 5,000 2008 Kanrei Sub Total 2 Vessels 19,000 cbm
Epic St. Martin 5,000 2008 Kanrei
Epic St. Lucia 5,000 2008 Sasaki Vessel: 11,000 cbm cbm Delivery Yard
St. Vincent 5,000 2008 Sasaki Epic Sicily* 11,000 2015 Sasaki
Epic St. Croix 5,000 2014 Sasaki Epic Samos 11,000 2016 Kyokuyo
Epic St. Thomas 5,000 2014 Sasaki Epic Sentosa 11,000 2016 Kyokuyo
Epic St. Agnes 5,000 2015 Kitanihon Epic Shikoku 11,000 2016 Kyokuyo
Epic St. Ivan 5,000 2015 Kitanihon Epic Sardinia* 11,000 2017 Kyokuyo
Epic Balta 6,300 2000 Higaki Epic Salina 11,000 2017 Kyokuyo
Sub Total 11 Vessels 56,300 cbm Sub Total 6 Vessels 66,000 cbm
*Bareboat and 273,100 cbmOverall Total of 41 Vessels,
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