ir presentation february 2016...steel plate bulk part contract steel cutting keellaying launching...
TRANSCRIPT
IR Presentation February 2016
CONTENTS
Ⅱ. New order & Backlog
Ⅲ. Products & Market Situation
Ⅰ. Financial Highlights
CONTENTS
Ⅱ. New order & Backlog
Ⅲ. Products & Market Situation
Ⅰ. Financial Highlights
Revenue & Operating Profit
Quarterly Earnings (recent 4Q)
Annual Earnings (past five years)
(KRWb)
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0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
-
5.0
10.0
15.0
20.0
2011 2012 2013 2014 2015
Revenue(Shipbuilding&Offshore)
Revenue(Others)
OP margin
13.4 14.5
14.8
9.7
8.7 8.3
6.2
1.4
(KRWt) (%)
2015
1Q 2Q 3Q 4Q
Revenue 2,610 1,439 2,436 3,229
Operating Profit 26 -1,548 -10 30
OP Margin 1.0% Losses Losses 0.9%
Profit before income tax 33 -1,498 -34 37
Net Profit 11 -1,155 -25 -43
▶ 4Q 2015 earnings
▷ Revenue : KRW 0.8t increased vs. 3Q 2015
- Increase is due to stabilization of construction
process for large offshore projects and increased
construction progress for vessels
▷ Operating Profit : KRW 30b profit
- Prior to one-time expense is KRW 60b
∙ One-time expense is from the restructuring cost , KRW 30b
12.9
Financial Summary
Consolidated Statements of Income
(KRWb)
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2011 2012 2013 2014 2015 1Q 2Q 3Q 4Q
Revenue 13,392 14,490 14,835 12,879 2,610 1,439 2,436 3,229 9,714
Operating Profit 1,160 1,206 914 183 26 -1,548 -10 30 -1,502
OP Margin 8.7% 8.3% 6.2% 1.4% 1.0% Losses Losses 0.9% Losses
Income Before Tax
1,150 1,045 819 190 33 -1,498 -34 37 -1,462
Net Profit 851 796 632 147 11 -1,155 -25 -43 -1,212
Financial Summary
Consolidated Statements of Financial Position
(KRWb)
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2010 2011 2012 2013 2014 2015
Total Assets 18,850 16,414 16,635 17,427 17,122 17,302
Cash & Cash Equiv. 1,255 1,289 1,164 1,140 893 2,137
Inventories 607 540 699 842 1,169 1,449
Accounts Receivable 5,449 4,078 5,091 5,935 6,400 4,710
Advanced Payments 1,638 1,675 1,501 1,354 1,204 895
Hedge Related 3,370 2,592 2,064 2,035 1,113 1,225
Total Liabilities 14,718 11,770 11,352 11,581 11,549 13,036
Advanced Receipts 5,431 5,602 3,967 3,885 3,799 3,928
Interest Bearing Debt 2,838 1,784 3,193 2,937 3,827 5,033
Hedge Related 3,578 2,452 1,458 1,725 1,093 1,313
Total Equity 4,132 4,644 5,283 5,846 5,573 4,266
Paid in Capital 1,155 1,155 1,155 1,155 1,155 1,155
Treasury Stock -662 -659 -657 -656 -970 -970
Debt/Equity Ratio 356% 253% 215% 198% 207% 306%
Risk Management
Improvement on risk management before/after the contract signing
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Pre-contract At execution
Risk assessment before bid participation
Prospect Selection Committee (ITT review incl.)
Cost Review Committee (Quantity review incl.)
Risk Review Committee
Contract terms Review Committee
Bid Review Committee
Bidding
only for risk hedging available projects
Contract Signing
Intensive risk analysis
& mitigation planning
Risk Workshop
Continuous risk verification & assessment
Specific action plans set-up
+3 months
of contract
Regular
Process
ITT issue
Award winning
KPI management
Factors to drive cost increase and construction delay
Regular KPI check and feedback
Lessons Learned System
To prevent repetitive errors,
lessons learned and improvements we’re making for current projects are systematically
recorded and applied to future projects
* Invitation to tender
Risk Hedging Policy
SHI Focuses on minimizing profit volatility
Building Event
Time Gap (months) 12 5 3 10
Currency
Receivable
Payable
Raw Material
Main Engine
Machinery
Steel Plate
Bulk Part
Contract Steel Cutting Keel Laying Launching Delivery
: Hedging, Order : Execution, Delivery
Foreign currency exposure is fully covered through forward transaction at the stage of shipbuilding contract
Main engine and machinery are ordered within 1~2 months after contract signing
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CONTENTS
Ⅲ. Products & Market Situation
Ⅰ. Financial Highlights
Ⅱ. New order & Backlog
January 2016
Trend
(USDb)
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Unit USDb
Containership - -
LNG Carrier - -
Tanker - -
Production Facility - -
Total - -
7.3
New Order
0
2
4
6
8
10
12
14
16
2012 2013 2014 2015 2016.Jan
10.0
0
9.6
13.3 0 Units
Order Backlog
January 2016
Trend
(USDb)
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Unit USDb
Containership 23 3.2
LNG Carrier 21 4.4
Tanker 41 2.7
Drilling Rig 10 5.9
Production Facility 14 18.4
Others 6 0.7
Total 115 35.3
Others 2%
LNG Carrier
12%
Tanker
8%
Drilling Rig
17%
Production
Facility
52%
Containership 9%
0
5
10
15
20
25
30
35
40
45
2012 2013 2014 2015 2016.Jan
35.3 37.2 37.5
35.4 34.8
$35.3 billion (115 Units)
CONTENTS
Ⅱ. New order & Backlog
Ⅰ. Financial Highlights
Ⅲ. Products & Market Situation
New orders expected to pick up after 2H 2016 after heavy orders in 2015
- Continuous competition among alliance members for cost improvement and operation efficiency
- Expected sharp decrease in number of deliveries after year 2019
Supply & Demand Balance Global order trend & SHI market share
(Source: Clarksons, SHI assumption) (Source: SHI)
(unit) (,000TEU)
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(M/S)
Containership
10
62
51
120 22%
8%
0%
5%
10%
15%
20%
25%
0
20
40
60
80
100
120
140
'12 '13 '14 '15
Global Order (Over 10kTEU) SHI M/S
11 10
1,340 1,265
986
183
8.1%
4.0% 3.7%
0.9%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
0
200
400
600
800
1,000
1,200
1,400
1,600
'16(e) '17(e) '18(e) '19(e)
Delivery Fleet Growth Trade Growth
Trade growth to be stable above 6%
Short term demand is weak, but long term outlook is solid due to
stable LNG trade growth(CAGR 5%) and longer distances with US exports
LNG Carrier
Long term outlook of LNG trading & Fleets
= approximately 120 vessels needed
Global order trend & SHI market share
(Source: SHI)
(unit)
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(M/S)
(Source: Gaslog, BP, Earnst&Young, Wood Mackenzie Jan 2015 )
2014 trading : approx 240mtpa
Current fleet
: approx 430 ships
(1.8ships/1mtpa)
~2030 trading(e) : approx 500mtpa Fleet outlook
: approx 900 ships
(= 30 ships to be
ordered a year
in avg )
< World LNG trading outlook>
CAGR 5%
2014 main routes New supply ~2030
32
39
64
27
13%
36%
8%
11%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
10
20
30
40
50
60
70
'12 '13 '14 '15
Global Order SHI M/S
4
14
5 3
Limited demand for high specification drillship is expected
as downturn continues due to shrinking investments in exploration
Drillship
Next generation: 20K BOP drillship
New demand for 20K BOP drillship is expected
- For safe and efficient operation in high-pressure
and high-temperature deep water reservoirs
Global order trend & SHI market share
(Source: SHI)
(unit)
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(M/S)
• BP-Maersk “Project 20K”
Jointly developing next generation drillship
using 20K BOP for Gulf of Mexico since
year 2013
* Drillship orders for the local content in Brazil included
(15 units in 2012 )
35
12
4
0
26%
42%
50%
0%
10%
20%
30%
40%
50%
60%
0
5
10
15
20
25
30
35
40
'12 '13 '14 '15
Global Order SHI M/S
9
5
2
Seeking both growth and profitability in offshore EPC market through
enhancement of EPC execution capability with ongoing projects
Production Facility
What we do for strengthening competitiveness Key projects under construction
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Ichthys CPF(Gas), Austrailia
Egina Oil FPSO, Nigeria
Lessons Learned Program
- Accumulating and systemizing knowledge learned from current projects to execute following better
Reinforcement of engineering capacity
- New R&D center established only for FEED, FEED verification, detailed design etc.
- Recruiting experienced engineers and project managers
Organizational improvement
- Risk management team and offshore package procurement team established
SHI’s new growth engine
- Market to expand due to its cost benefit and environmental advantage
FLNG
Concept & Advantage
Production, treatment, liquefaction and offloading
of natural gas to be carried out on a vessel
- No need for extensive pipe lines and onshore
processing facilities
Less CAPEX required
Natural Gas
Pretreatment
Liquefaction
FLNG projects under consideration
Number Projects
Under construction
3 Prelude(Shell)
Kanowit, Rotan (Petronas)
Active 4 Browse1,2,3(Shell)
Mozmbique(ENI), etc.
Potential 31 Scarborough, Sunrise, etc.
Total 38
(Source: Clarkson World Offshore Register )
3 Projects will be complete during year '15~'18
4 Projects are actively under review process
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SHI leads the market with long experiences and solid relationship with its
strategic partners
FLNG
Long term relationship with the leading companies
(Source: SHI, Shell)
Prelude Browse
Region Austrailia Austrailia
LNG Capacity 3.5mpta 12.0mtpa
Contract amount 6 USDb under negotiation
FID 2011 2016
Delivery 2016 2021~2023
Major big projects are underway based on long term agreement with Royal Dutch Shell and Technip
that are leaders of FLNG market.
FEED & EPC contract for Browse project made in June 2015
- EPC contract amount ($4.7b) includes hulls of three FLNGs
and top side price will be added when the FEED is complete.
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* To commence with NTP issuance in 2016
Appendix- Global Network
Oslo
London
Athens Tokyo
Dubai
Rongcheng
Ningbo
Singapore
Houston
Kuala Lumpur
Houston
Deli
Rio De Janeiro
Lagos
Shipyard Block Factory Engineering Center Branch Office
Global production and engineering bases enable SHI to meet various needs of customers
Block Factories in China (2) Ningbo (Since 1997) , Rongcheng (Since 2007)
Offshore Engineering Centers (2) Houston [ASOG (J/V with AMEC)], Deli (Noida)
Branch Office (10) London, Oslo, Athens, Lagos, Dubai, Kuala Lumpur, Singapore, Tokyo, Huston, Rio De Janeiro
Geoje Shipyard
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Appendix- Shipyard View
Site : 4.0million ㎡
Quay Wall Length : 7.9Km (24 vessels)
3 Floating Cranes : 3,000 / 3,600 / 8,000ton
8 Docks (3 Dry Docks & 5 Floating Docks) ▪ No. 1 : 283m × 46m ▪ NO. 2 : 390m × 65m ▪ No. 3 : 640m × 98m ▪ G1 : 270m × 52m ▪ G2 : 400m × 55m ▪ G3 : 400m × 70m ▪ G4 : 420m × 70m ▪ G5 : 157m × 131m (only for Offshore)
SHI Focuses on minimizing profit volatility
Offshore Facilities
Dry Dock No.2
Floating Dock 3
Dry Dock No.3
Floating Dock 2
Floating Dock 4
Main Building
Dry Dock No. 1
ShinHanne Factory
Floating Dock 1
Floating Dock 5
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Disclaimer
This presentation has been prepared by Samsung Heavy Industries Co., Ltd. and contains forward-looking
statements that are subject to risks, uncertainties, and assumptions.
The presentation is solely for your information, subject to change without notice, and makes no
representation or warranty, expressed or implied and no reliability should be placed on the accuracy,
fairness, or completeness of the information presented herein.
The Company, its affiliates, or representatives accept no liability for any losses arising from any information
contained in the presentation.
The contents of this presentation may not be reproduced, redistributed or circulated, directly or Indirectly,
to any other person or organization, or published, in whole or in part, for any purpose.
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