earnings release - navig8chemicaltankers.com · consolidated results for the quarter ended...
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EARNINGS RELEASE3Q 2016
www.navig8chemicaltankers.com
NOVEMBER 10TH, 2016
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DISCLAIMER
This Presentation contains certain forward-looking statements relating to the business, future 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. In particular, this Presentation contains forward-looking statements with respect to cost of construction of the Company’s newbuildings and timing of their
delivery, values of the assets of the Company and the potential future revenue and EBITDA these assets may yield under current or future contracts, the potential future revenues and cash flows of the Company, the
potential future demand and market for the Company’s assets, the potential value of the ordinary shares of the Company and the Company’s equity and debt financing requirements and its ability to obtain financing in a
timely manner and at favorable terms.
The forward‐looking statements contained in this Presentation are based on the current, estimates and projections of the Company or assumptions based on information currently available to the Company. Such forward-
looking information and statements, 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.
Potential investors are expressly advised that financial projections, such as the revenue and cash flow projections contained herein, cannot be used as reliable indicators of future revenues or cash flows. No obligation is
assumed to update any forward‐looking statements or to conform these forward‐looking statements to our actual results.
Restrictions on Distribution of Presentation
This Presentation has been prepared by the Company exclusively for information purposes. This Presentation has not been reviewed by or registered with any public authority or stock exchange. This Presentation does not
constitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for any securities, including in the United States, nor shall it or any part of it form the basis of or be
relied on in connection with any contract or commitment whatsoever. Specifically, this presentation does not constitute a “prospectus” within the meaning of the U.S. Securities Act of 1933, as amended.
_______
This Presentation is being distributed in Norway solely to and directed solely at persons who (i) have professional experience knowledge and expertise in matters relating to financial investments, (ii) are high net‐worth
entities, or (iii) are persons to whom an invitation or inducement to engage in investment activity has been extended by the Company (all such persons together being referred to as “Relevant Persons”). This Presentation
is directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this Presentation may relate is available only to
Relevant Persons and will be engaged in only with Relevant Persons. Neither this Presentation (nor any part of it) may be reproduced, distributed, passed on, or the contents otherwise divulged, directly or indirectly, to
any person who is not a Relevant Person without the prior written consent of the Company.
No public solicitations relating to a possible transaction in connection with this Presentation are being made or will be made directly or indirectly in the United States. Any securities that may be delivered in connection
with any transaction referred to in the Presentation will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable
exemption from registration requirements. The distribution of this Presentation may also in other jurisdictions be restricted by law. Accordingly, this Presentation may not be distributed in any jurisdiction except under
circumstances that will result in compliance with applicable laws and regulations. The Company requires persons in possession of this Presentation to inform themselves about and to observe any such restrictions. By
accepting delivery of this Presentation you acknowledge and agree to comply with the foregoing restrictions.
Established in 2013 by the Navig8 Group to capitalise on
the significant changes in the petrochemical industry
Best-in-class chemical tanker platform combining:
• Fleet of 32 fuel-efficient newbuildings with
exclusively modern eco-designs
• Expertise of the world’s leading pool and commercial
management provider
Large modern vessels strategically selected to take
advantage of the continuing shift to long-haul chemical
trades
Complementary mix of primarily interline coated and
stainless vessels that captures the full range of chemicals,
including specialized types
Early mover advantage
Leading Chemical Tanker and Commercial PlatformsOVERVIEW
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Headquartered in London, established in March 2007
Global network of 16 offices with 300+ employees
Manages 17 shipping pools in 5 shipping segments:
crude, product, chemicals and dry bulk and offshore
• 300+ vessels under management, including 80 vessel
newbuilding program
• Diverse pool member base with 58 owners from 18
countries
Unrivalled network of relationships
• Deep knowledge of global commodity flows and
transportation
• Proximity to customers and regional markets
• In-house research
NAVIG8 CHEMICALS TANKERS INCLeading platform with a fleet of large, high specification chemical tankers
NAVIG8 GROUPLargest independent commodity transportation company in the world
RECENT DEVELOPMENTS
Generated revenue of $35.8 million and net income of $3.7 million, or $0.10
per share, for the three months ended September 30, 2016.
Continued growth of the Company’s operating fleet:
Delivery of one IMO2 25,000 DWT S-Class stainless steel chemical
tanker and one IMO2 49,000 DWT Interline-coated chemical tanker
during the third quarter.
Delivery of two additional IMO2 25,000 DWT S-Class stainless steel
chemical tankers and one T-Class IMO2 49,000 DWT-Class vessel in
October 2016.
27 vessels of the Company’s 32-vessel newbuilding fleet had been
delivered as of November 10th, 2016.
Canceled newbuilding contracts for five IMO2 49,000 DWT chemical tankers.
Entered into a sale and leaseback transaction with SBI Holdings for two
25,000 DWT chemical tankers for net proceeds of $74.0 million.
Entered into $54.3 million secured loan facility to finance two remaining
vessels under construction at Kitanihon.
RECENTDEVELOPMENTSFor the quarter ended September 30, 2016
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FLEET CONSTRUCTION SCHEDULE (As of November 10th, 2016)
STRATEGICASSETSLarge, high specification eco tankers from top quality yards
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Average DWT 36,000 dwt;
2.5 times industry average
Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17
Navig8 AlmandineNavig8 Amber
Navig8 AmethystNavig8 Ametrine
Navig8 AventurineNavig8 Andesine
Navig8 AmazoniteNavig8 Aronaldo
Navig8 AquamarineNavig8 AxiniteNavig8 Amessi
Navig8 AmmoliteNavig8 AzuriteNavig8 Azotic
Navig8 AdamiteNavig8 AragoniteNavig8 AlabasterNavig8 Achroite
Navig8 SiriusNavig8 Sky
Navig8 SparkNavig8 StellarNavig8 Saiph
Navig8 SceptrumNavig8 Spica
Navig8 Sol
Navig8 TurquoiseNavig8 Topaz
Navig8 TourmalineNavig8 Tanzanite
Navig8 VictoriaNavig8 Violette
Dec-15
Oct-15
Feb-15
Mar-15
May-15
Aug-15
Apr-15
Apr-15
May-15
Jun-16
Jun-15
Jul-15
Jun-15
Jul-15
Aug-15
Jan-16
Aug-16
Oct-16
Oct-16
Jan-17
Apr-17
May-17
Aug-17
Apr-16
Jul-16
Oct-16
Nov-16
Jan-15
Mar-15
Mar-15
Sep-15
Sep-15
A-CLASS (IMO II 37,000 DWT INTERLINE 9001) TODAY YEAR-END
25,000 DWT STAINLESS STEEL
T-CLASS (IMO II 49,000 DWT INTERLINE 9001)
V-CLASS (IMO II 50,000 DWT EPOXY)
FINANCIALS
OPERATINGRESULTSConsolidated results for the quarter ended September 30th, 2016
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INCOME STATEMENT DATA For the three months ended 30 September
For the nine months ended 30 September
US$ millions, unless otherwise stated 2016 2015 2016 2015
Results
Revenue 35.8 28.7 112.3 46.4
Vessel expenses (12.7) (8.0) (35.4) (13.2)
General and administrative expenses
Loss on cancellation of newbuilding contracts
(2.2)
(0.6)
(1.6)
-
(5.6)
(0.6)
(5.3)
-
EBITDA(1) $20.3 $19.1 $70.7 $27.9
Depreciation and amortization (8.8) (5.3) (23.7) (9.1)
EBIT 11.5 13.9 47.0 18.7
Financial items (7.9) (4.3) (23.3) (7.2)
Net income/(loss) 3.7 9.6 23.7 11.5
Earnings per common share $0.10 $0.25 $0.62 $0.32
(1) EBITDA is defined as earnings before interest, taxes, depreciation and amortization. This non-GAAP measure is presented in this press release as the Company believes it provides investors with a means of evaluating and understanding how Navig8 Chemical Tankers Inc.’s management evaluates operating performance. The non-GAAP measure should not be considered in isolation from, as substitutes for, or superior to financial measures prepared in accordance with U.S. GAAP. In addition, the non-GAAP measure do not have standardized meanings, and are therefore unlikely to be comparable to similar measures presented by other companies.
OPERATINGRESULTSConsolidated results for the quarter ended September 30th, 2016
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(1) Time charter equivalent, or TCE revenue, a non-US GAAP measure, is vessel revenues less voyage expenses (including bunkers and port charges). TCE revenue is included herein because it is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company’s performance irrespective of changes in the mix of charter types (i.e., spot charters, time charters, and pool charters), and it provides useful information to investors and management. (2) Operating costs per day are routine operating expenses and comprise crewing, repairs and maintenance, insurance, stores lube oils, communication costs and technical management fees.
OTHER OPERATING DATA
37k dwt 49k dwt 49k dwt 25k dwt
HMD Vessels Vinashin Vessels STX Vessels Kitanihon Vessels
Number of vessels on the water at the end of the month 18 2 2 2
Average TCE(1) in $ / day 16,773 17,514 19,562 20,561
Total operating days 1,656 184 157 143
Average operating costs (2) in $ / day 5,573 6,026 5,500 5,782
OTHER OPERATING DATA
37k dwt 49k dwt 49k dwt 25k dwt
HMD Vessels Vinashin Vessels STX Vessels Kitanihon Vessels
Number of vessels on the water at the end of the month 18 2 1 1
Average TCE(1) in $ / day 21,822 19,979 21,194 18,194
Total operating days 1,637 182 77 4
Average operating costs (2) in $ / day 5,483 5,764 5,444 5,779
Third Quarter 2016
Second Quarter 2016
BALANCESHEETConsolidated balance sheet as of September 30th, 2016
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(1)Balance includes $17.4 million and $16.0 million of restricted cash for the periods ending September 30th 2016 and December 31, 2015, respectively.
BALANCE SHEET DATA As at
US$ millions, unless otherwise stated September 30, 2016 December 31, 2015
Cash(1) 62.4 34.4
Receivables, Inventories and Other Assets 36.2 28.1
Vessels and Instalment Payments
Vessels, net 889.2 663.9
Vessels, capital lease - 41.3
Vessels under construction 117,2 147.5
Vessel related deposits - -
Total Assets 1,105.0 915.2
Debt and Capital Lease Obligations
Obligations under capital lease - 36.1
Current portion of long-term bank loans 95.7 56.8
Long-term bank loans 558.9 389.5
Payables and Accruals 7.8 13.8
Equity 442.6 418.9
Total Liabilities and Equity 1,105.0 915.2
HIGHLIGHTS
NAVIG8OUTLOOK
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NEWBUILDING VESSELS ARE BEING DELIVERED ACCORDING TO SCHEDULE, AND FLEET IS GENERATING SIGNIFICANT CASH FLOW
PETROCHEMICAL EXPORT CAPACITY IS INCREASING IN THE U.S. AND MIDDLE EAST
LONG-HAUL DEMAND FOR CARGOES IS STEADILY INCREASING
SEABORNE DEMAND FOR PETROCHEMICALS IS EXPECTED TO OUTPACE SUPPLYAS FORECASTED FLEET GROWTH IS MINIMAL
NAVIG8’S FLEET IS STRATEGICALLY DESIGNED FOR LONG-HAUL TRADES, GIVING US AN EARLY MOVER ADVANTAGE.
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