GasLog Q3 2012 results presentation

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  • 1.         GASLOG  LTD       Third  Quarter  Earnings  Presenta7on  2012     21  November  2012          
  • 2.    Forward  Looking  Statements  This   presenta6on   contains   “forward-­‐looking   statements”   as   defined   in   the   Private   Securi6es   Li6ga6on   Reform   Act   of   1995.     The   reader  is   cau6oned   not   to   rely   on   these   forward-­‐looking   statements.     These   statements   are   based   on   current   expecta6ons   of   future   events.     If  underlying   assump6ons   prove   inaccurate   or   unknown   risks   or   uncertain6es   materialize,   actual   results   could   vary   materially   from   our  expecta6ons  and  projec6ons.    Risks  and  uncertain6es  include,  but  are  not  limited  to,  general  LNG  and  LNG  shipping  market  condi6ons  and  trends,  including  charter  rates,  ship  values,  factors  affec6ng  supply  and  demand  and  opportuni6es  for  the  profitable  opera6ons  of  LNG   carriers;   our   con6nued   ability   to   enter   into   mul6-­‐year   6me   charters   with   our   customers;   our   contracted   charter   revenue;   our  customers’   performance   of   their   obliga6ons   under   our   6me   charters   and   other   contracts;   the   effect   of   the   worldwide   economic  slowdown;  future  opera6ng  or  financial  results  and  future  revenue  and  expenses;  our  future  financial  condi6on  and  liquidity;  our  ability  to   obtain   financing   to   fund   capital   expenditures,   acquisi6ons   and   other   corporate   ac6vi6es,   and   funding   by   banks   of   their   financial  commitments;   future,   pending   or   recent   acquisi6ons   of   ships   or   other   assets,   business   strategy,   areas   of   possible   expansion   and  expected   capital   spending   or   opera6ng   expenses;   our   ability   to   enter   into   shipbuilding   contracts   for   newbuilding   ships   and   our  expecta6ons   about   the   availability   of   exis6ng   LNG   carriers   to   purchase,   as   well   as   our   ability   to   consummate   any   such   acquisi6ons;   our  expecta6ons  about  the  6me  that  it  may  take  to  construct  and  deliver  newbuilding  ships  and  the  useful  lives  of  our  ships;  number  of  off-­‐hire  days,  drydocking  requirements  and  insurance  costs;  our  an6cipated  general  and  administra6ve  expenses;  fluctua6ons  in  currencies  and   interest   rates;   our   ability   to   maintain   long-­‐term   rela6onships   with   major   energy   companies;   expira6on   dates   and   extensions   of  charters;   our   ability   to   maximize   the   use   of   our   ships,   including   the   re-­‐employment   or   disposal   of   ships   no   longer   under   mul6-­‐year  charter   commitments;   environmental   and   regulatory   condi6ons,   including   changes   in   laws   and   regula6ons   or   ac6ons   taken   by  regulatory   authori6es;   risks   inherent   in   ship   opera6on,   including   the   discharge   of   pollutants;   availability   of   skilled   labor,   ship   crews   and  management;  poten6al  disrup6on  of  shipping  routes  due  to  accidents,  poli6cal  events,  piracy  or  acts  by  terrorists;  and  poten6al  liability  from  future  li6ga6on.  A  further  list  and  descrip6on  of  these  risks,  uncertain6es  and  other  factors  can  be  found  in  our  Prospectus  filed  April  2,  2012.    Copies  of  the  Prospectus,  as  well  as  subsequent  filings,  are  available  online  at  www.sec.gov  or  on  request  from  us.    We  do  not  undertake  to  update  any  forward-­‐looking  statements  as  a  result  of  new  informa6on  or  future  events  or  developments.    The  declara6on  and  payment  of  dividends  is  at  all  6mes  subject  to  the  discre6on  of  our  Board  of  Directors  and  will  depend  on,  among  other  things,  our  earnings,  financial  condi6on,  cash  requirements  and  availability,  restric6ons  in  our  credit  facili6es  and  the  provisions  of  Bermuda  law  and  such  other  factors  as  the  Board  of  Directors  may  deem  advisable.       2  
  • 3.    Agenda   •   Highlights   •   Financial  Highlights   •   Business  Overview     •   Market  Update   •   Summary   3  
  • 4.    Highlights  •  For  the  third  quarter,  GasLog  reports  Adjusted  EBITDA*  of  $9.7  million,  Adjusted  Profit*  of  $4.0   million  and  Profit  of  $2.9  million.  •  Adjusted  EPS*  of  $0.06    and  EPS  of  $0.05  for  the  third  quarter  of  2012.    •  Quarterly  dividend  of  $0.11  per  common              share  is  payable  on  December  17,  2012.      •  Con6nued  strong  fundamentals  for  the  LNG  industry.    •  100%  u6liza6on  of  GasLog  Savannah  &  GasLog  Singapore  during  Q3-­‐2012.  •  The  8  LNG  newbuildings  are  on  schedule  and  within  budget.  •  62%  of  the  floa6ng  interest  rate  exposure  on  our  fully  funded  debt  program  has  been  hedged  at   a   weighted   average   interest   rate   of   approximately   4.3%   (incl.   margin)   as   of   September   30,   2012.  *  See  Annex  1  for  reconcilia6on  of  Adjusted  EBITDA,  Adjusted  Profit  and  Adjusted  EPS   4  
  • 5.    Financial  Highlights   9 months 3 months (USD%000) Q3%2012% Q3%2011 Q3%2012% Q3%2011 2011 2010 Revenues 50,244 48,675 16,935 15,918 66,471 39,832 1   EBITDA 19,238 30,576 8,624 10,028 36,139 21,076 Adjusted%EBITDA 1   26,389 30,770 9,745 10,271 Share%of%Profit%of%Associate 761 1,019 3 362 1,312 1,460 Net%Financials% 2   ,14,915 ,7,139 ,4,158 ,2,482 ,12,314 ,4,925 Profit% 1,543 14,057 2,924 4,572 13,723 9,591 Adjusted%Profit% 1   8,694 14,251 4,045 4,814 EPS,%diluted%($/share) 0.03 0.37 0.05 0.12 0.36 0.25 1   Adjusted%EPS,%diluted%($/share) 0.16 0.37 0.06 0.12 Average%Number%of%Vessels: Owned 2.00 2.00 2.00 2.00 2.00 1.00 Managed 14.0 14.0 14.0 14.0 14.0 10.3 Ownership%Segment: Time%Charter%Equivalent%rates%pr.%day% 76,885 76,205 76,886 76,511 76,378 76,086 ($/day) Utilisation 100% 100% 100% 100% 100% 100%1.  See  Annex  1  for  reconcilia6on  of  EBITDA,  Adjusted  EBITDA,  Adjusted  Net  Profit  and  Adjusted  EPS.        In  2012,  Adjusted  EBITDA,  Adjusted  Net  Profit  and  Adjusted  EPS,  exclude   the   non-­‐cash   loss   caused   primarily   from   mark-­‐to-­‐market   valua6on   of   interest   rate   swaps   ($7.0   million   for   the   9   months   and   $1.7   million   for   the   3   months)   and   foreign   exchange  differences  ($0.2  million  loss  for  the  9  months  and  $0.6  million  gain  for  the  3  months).  2.  5   Net  Financials  represents  financial  costs,  financial  income,  and  loss  on  interest  rate  swaps,  net.  
  • 6.    Financial  Highlights   (USD%000) 30*Sep*12% 31*Dec*11% 31*Dec*10% Assets Non*current%assets Goodwill 9,511 9,511 9,511 Investment2in2associate 7,289 6,528 7,003 Tangible2fixed2assets 430,150 438,902 450,265 Deferred2financing2costs 21,850 14,289 0 Other2nonEcurrent2assets 3,846 872 0 Vessels2under2construction 196,072 109,070 18,700 Total%non*current%assets 668,719 579,172 485,479 Current%assets Trade2and2other2receivables 2,192 2,683 822 Dividends2receivable2and2due2from2related2parties 392 1,274 1,276 Inventories 493 425 383 Prepayments2and2other2current2assets 588 3,366 775 Short2term2investments 211,799 0 0 Cash2and2cash2equivalents 26,737 20,093 23,270 Total%current%assets 242,202 27,841 26,526 Total%assets 910,921 607,013 512,005 6  
  • 7.    Financial  Highlights   (USD%000) 30*Sep*12% 31*Dec*11% 31*Dec*10% Equity%&%Liabilities Equity Share&capital 629 391 391 Contributed&surplus 628,919 300,716 199,635 Reserves ?12,217 1,744 ?1,816 Accumulated&deficit ?10,895 ?12,437 ?26,477 Equity%attributable%to%owners%of%the%Group 606,435 290,414 171,733 Non?controlling&interest 0 0 9,199 Total%equity 606,435 290,414 180,932 Current%liabilities Trade&accounts&payable 1,012 1,705 1,397 Ship&management&creditors 13 1,102 6,886 Amounts&due&to&related&parties 98 114 172 Derivative&financial&instruments 5,900 3,451 2,560 Other&payables&and&accruals 7,187 18,541 6,986 Loans&?&current&portion 23,999 24,277 22,640 Total%current%liabilities 38,209 49,190 40,641 Non*current%liabilities Derivative&financial&instruments 26,775 5,101 2,835 Loans&?&non?current&portion 236,985 256,788 287,597 Advances&from&related&parties 0 0 0 Other&non?current&liabilities 2,517 5,520 0 Total%non*current%liabilities 266,277 267,409 290,432 Total%equity%&%liabilities 910,921 607,013 512,005 7  
  • 8.    Financial  Highlights  The  following  table  summarizes  GasLog’s  contracted  revenues  and  vessel  u6liza6on  as  of  October  1,  2012,  within  the  Vessel  Ownership  segment.     2012 2013 2014 2015 2016( Total 2021 Contracted*time*charter*revenues 1   (USD%million) *****************14* 2   ********133* ********215* ***********211* ********622* ****1,195* Total*contracted*days (days) 184 1,742 2,831 2,768 7,945 15,470 Total*available*days (days) 184 1,742 2,832 3,532 19,303 27,593 Total*unfixed*days (days) B B 1 764 11,358 12,123 Percentage*of*total*contracted*days/total* (pct.) 100% 100% 100% 78% 41% 56% available*days*for*the*ten*ships Please  refer  to  the  Q3-­‐2012  6-­‐K  filing  for  further  details.       1   Revenue   calcula6ons   assume   365   revenue   days   per   annum,   with   30   off-­‐hire   days   when   the   ship   undergoes   scheduled   drydocking.   Two   of   our   ships   are   scheduled  to  be  drydocked  in  2015,  three  are  scheduled  to  be  drydocked  in  2018  and  one  is  scheduled  to  be  drydocked  in  2019.     2  Contracted  revenue  for  the  full  year  ending  December  31,  2012  is  $  56  million.   8  
  • 9.    Financial  Highlights   Expected Loan Drawdown Ship Built Bank (USD millions) Date Maturity Hedged pct. 3   GasLog Savannah 2010 DSF $149¹ N/A 2020 100% GasLog Singapore 2010 DnB, NBG, UBS $114¹ N/A 2014 Hull 1946 2013 DnB, KEXIM $136 Q1 2013 20252 70.6% Hull 1947 2013 DnB, KEXIM $136 Q1 2013 20252 70.6% Hull 2016 2013 Nordea, ABN, Citi $139 Q2 2013 2019 98.7% Hull 2017 2013 Nordea, ABN, Citi $139 Q3 2013 2019 Hull 2041 2013 Credit Suisse $144 Q4 2013 2020 75.0% Hull 2042 2014 DnB, SEB, CBA, ING, DSF $143 Q1 2014 2021 / 2022 32.9% Hull 2043 2014 DnB, SEB, CBA, ING, DSF $146 Q4 2014 2021 / 2022 In total ~62% covered at 4.30% all-in fixed Hull 2044 2015 DnB, SEB, CBA, ING, DSF $146 Q1 2015 2021 / 2022 interest1.  Outstanding Balance as of September 30, 2012.2.  Lenders have a put option that gives them the right to request repayment of the facility in full on the fifth anniversary of the delivery of the first ship serving as collateral under the facility.3.  Represents the portion of the loan bearing interest at a floating rate that has been hedged to a fixed rate by way of an interest rate swap. Please refer to note 13 of the financial statements included in our Q3-2012 6-K filing for details surrounding the Interest Rate Swaps. 9  
  • 10.    Business  Overview   Capacity Ship Owned Built (mcbm) Propulsion Charterer 2012 2013 2014 2015 2016 2017 2018 2019 2020Methane Nile Eagle 25 % 2007 145,000 SteamGasLog Savannah 100 % 2010 155,000 TFDE¹GasLog Singapore 100 % 2010 155,000 TFDEHull 1946 100 % 2013 155,000 TFDEHull 1947 100 % 2013 155,000 TFDEHull 2016 100 % 2013 155,000 TFDEHull 2017 100 % 2013 155,000 TFDEHull 2041 100 % 2013 155,000 TFDEHull 2042 100 % 2014 155,000 TFDEHull 2043 100 % 2014 155,000 TFDEHull 2044 100 % 2015 155,000 TFDE 2Option 1 2015 155,000 TFDE 2Option 2 2015 155,000 TFDE Firm Charter Charterer Optional Period Under Discussions for Charter1. Tri -fuel Diesel Electric.2. Options expire in 2012. 10  
  • 11.    Market  Update  LNG   shipping   con6nued   to   benefit   from   strong   industry   fundamentals.   Spot   rates   somened   in  Q3-­‐2012,  but  remain  at  historically  high  levels;  suppor6ng  op6mism  for  longer-­‐term  forward-­‐rates.  We  expect  LNG  produc6on  to  increase.  Developments  in  Q3-­‐2012  include:    •  Cheniere   Energy   took   final   investment   decision   (“FID”)   on   the   construc6on   of   the   first   two   trains  at  its  Sabine  Pass,  Louisiana,  LNG  export  project,  for  a  planned  start-­‐up  as  early  as  2015.    •  Australia  Pacific  LNG  (led  by  ConocoPhilips  and  Origin  Energy)  (Australia)  took  FID  on  a  2nd  train   of  4.5  mtpa  capacity,  for  a  planned  start-­‐up  in  2016.  •  Further  increases  in  discoveries  and  gas  reserves  in  East  Africa.   11  
  • 12.    Market  Update  (cont.)   500# Projected#Global#LNG#Produc?on#Capacity# 450# South#East#Asia# 400# Middle#East# North#America# LNG#(mtpa)# 350# Africa# Russia# 300# Australia# Exis?ng# 250# 200# 2011# 2012# 2013# 2014# 2015# 2016# 2017# 2018# 2019# 2020#The  aoached  chart  was  prepared  using  informa6on  from  external  sources  as  well  as  GasLogs  internal  es6mates.    The  chart  is  based  on  numerous  variables  and  assump6ons,  including  assump6ons  as  to  certain  business  decisions  that  other  companies  will  make,  and  is  therefore  inherently  specula6ve.    As  a  result,  future  produc6on  capacity  will  likely  differ  and  may  differ  materially  from  the  informa6on  presented  in  the  chart.    GasLog  will  not  update  the  chart    to  reflect  circumstances  exis6ng  amer  the  date  the  informa6on  was  generated  or  to  reflect  the  occurrence  of  future  events.   12  
  • 13.    Summary   Q3-­‐2012  financials  beoer  than  expecta6ons  *     2012-­‐2015  contracted  revenue  is  expected  to  be  on-­‐track,  with  our  newbuilding   orderbook  on  6me  and  on  budget.       GasLog  is  paying  a  quarterly  dividend  of  $0.11  per  share  on  December  17,  2012.     Con6nued  strong  fundamentals  for  the  LNG  industry.     GasLog’s  strengths  come  from:   •  Significant  contracted  revenues  from  credit-­‐worthy  counterparts.   •  A  fully  funded  newbuilding  program.       •  A  young,  pure-­‐play  LNG  shipping  fleet  with  the  latest  technology.   •  A  leading  technical  plaqorm  delivering  strong  opera6onal  performance.      *  Excluding  non-­‐cash  loss  on  interest  rate  swaps  and  foreign  exchange  gains    (mainly  unrealized).   13  
  • 14.    Annex  1  –  reconcilia6on  /  non-­‐GAAP  measures  Non-­‐GAAP  Financial  Measure    EBITDA  represents  earnings  before  interest  income  and  expense,  taxes,  deprecia6on  and  amor6za6on.  Adjusted  EBITDA  represents  EBITDA  before  loss  on  interest  rate  swaps  and  foreign   exchange   gains/losses.   Adjusted   Profit/(loss)   and   Adjusted   EPS   represent   earnings   and   earnings   per   share,   respec6vely,   before   loss   on   interest   rate   swaps   and   foreign  exchange  gains/losses.  EBITDA,  Adjusted  EBITDA,  Adjusted  Profit/(loss)  and  Adjusted  EPS,  which  are  non-­‐GAAP  financial  measures,  are  used  as  supplemental  financial  measures  by  management  and  external  users  of  financial  statements,  such  as  investors,  to  assess  our  financial  and  opera6ng  performance.  We  believe  that  these  non-­‐GAAP  financial  measures  assist  our  management  and  investors  by  increasing  the  comparability  of  our  performance  from  period  to  period.  We  believe  that  including  EBITDA,  Adjusted  EBITDA,  Adjusted  Profit/(loss)   and   Adjusted   EPS   assists   our   management   and   investors   in   (i)   understanding   and   analyzing   the   results   of   our   opera6ng   and   business   performance,   (ii)   selec6ng  between   inves6ng   in   us   and   other   investment   alterna6ves   and   (iii)   monitoring   our   ongoing   financial   and   opera6onal   strength   in   assessing   whether   to   con6nue   to   hold   our  common  shares.  This  increased  comparability  is  achieved  by  excluding  the  poten6ally  disparate  effects  between  periods  of,  in  the  case  of  EBITDA  and  Adjusted  EBITDA,  interest,  taxes,  deprecia6on  and  amor6za6on  and,  and  in  the  case  of  Adjusted  EBITDA,  Adjusted  Profit/(loss)  and  Adjusted  EPS,  loss  on  interest  rate  swaps  and  foreign  exchange  gains/losses,  which  items  are  affected  by  various  and  possibly  changing  financing  methods,  capital  structure  and  historical  cost  basis  and  which  items  may  significantly  affect  results  of  opera6ons  between  periods.      EBITDA,   Adjusted   EBITDA,   Adjusted   Profit/(loss)   and   Adjusted   EPS   have   limita6ons   as   analy6cal   tools   and   should   not   be   considered   as   alterna6ves   to,   or   as   subs6tutes   for,   profit,  profit  from  opera6ons,  earnings  per  share  or  any  other  measure  of  financial  performance  presented  in  accordance  with  IFRS.  These  non-­‐GAAP  financial  measures  exclude  some,  but  not  all,  items  that  affect  profit,  and  these  measures  may  vary  among  companies.  In  evalua6ng  Adjusted  EBITDA,  Adjusted  Profit/(loss)  and  Adjusted  EPS,  you  should  be  aware  that  in  the  future  we  may  incur  expenses  that  are  the  same  as  or  similar  to  some  of  the  adjustments  in  this  presenta6on.  Our  presenta6on  of  Adjusted  EBITDA,  Adjusted  Profit/(loss)  and  Adjusted  EPS  should  not  be  construed  as  an  inference  that  our  future  results  will  be  unaffected  by  the  excluded  items.  Therefore,  the  non-­‐GAAP  financial  measures  as  presented  below  may  not  be  comparable  to  similarly  6tled  measures  of  other  companies  in  the  shipping  or  other  industries.   14  
  • 15.    Annex  1  -­‐  reconcilia6on  (cont.)   Reconciliation of EBITDA and Adjusted EBITDA to Profit for the three and nine month periods ended: (All amounts expressed in U.S. Dollars) For the three months ended For the nine months ended September 30, 2011 September 30, 2012 September 30, 2011 September 30, 2012 Profit for the period 4,571,575 2,923,994 14,056,658 1,542,931 Depreciation of fixed assets 3,206,858 3,288,480 9,612,638 9,773,311 Financial costs 2,262,006 2,892,817 6,947,506 8,846,897 Financial income (12,265) (481,265) (41,170) (925,124) EBITDA 10,028,174 8,624,026 30,575,632 19,238,015 Loss on interest rate swaps, net 232,639 1,746,781 232,639 6,993,147 Foreign exchange (gains)/losses 9,892 (625,791) (38,718) 157,644 Adjusted EBITDA 10,270,705 9,745,016 30,769,553 26,388,806 Reconciliation of EBITDA to Profit for the years ended: (All amounts expressed in U.S. Dollars) December 31, 2010 December 31, 2011 Profit for the year 9,590,852 13,722,678 Depreciation of fixed assets 6,560,381 12,827,284 Financial costs 5,046,117 9,631,262 Financial income (121,050) (41,679) EBITDA 21,076,300 36,139,545 15  
  • 16.    Annex  1  -­‐  reconcilia6on  (cont.)   Reconciliation of Adjusted Profit to Profit for the three and nine month periods ended: (All amounts expressed in U.S. Dollars) For the three months ended For the nine months ended September 30, 2011 September 30, 2012 September 30, 2011 September 30, 2012 Profit for the period 4,571,575 2,923,994 14,056,658 1,542,931 Loss on interest rate swaps, net 232,639 1,746,781 232,639 6,993,147 Foreign exchange (gains)/losses 9,892 (625,791) (38,718) 157,644 Adjusted Profit 4,814,106 4,044,984 14,250,579 8,693,722 Non-controlling interest — — 316,973 — Adjusted Profit attributable to owners of the Group 4,814,106 4,044,984 14,567,552 8,693,722 16  
  • 17.    Annex  1  -­‐  reconcilia6on  (cont.)   Reconciliation of Adjusted Earnings Per Share to Earnings Per Share for the three and nine month periods ended: (All amounts expressed in U.S. Dollars) For the three months ended For the nine months ended September 30, 2011 September 30, 2012 September 30, 2011 September 30, 2012 Profit for the period attributable to owners of the Group 4,571,575 2,923,994 14,373,631 1,542,931 Less: Earnings allocated to manager shares and subsidiary manager 379,777 — 1,242,669 22,704 shares Earnings attributable to the owners of common shares used in the 4,191,798 2,923,994 13,130,962 1,520,227 calculation of basic EPS Weighted average number of shares outstanding 35,853,200 62,863,166 35,751,628 53,820,841 EPS 0.12 0.05 0.37 0.03 Adjusted profit for the period attributable to owners of the Group 4,814,106 4,044,984 14,567,552 8,693,722 Less: Adjusted earnings allocated to manager shares and subsidiary 399,924 — 1,259,282 127,926 manager shares Adjusted earnings attributable to the owners of common shares used 4,414,182 4,044,984 13,308,270 8,565,796 in the calculation of basic EPS Weighted average number of shares outstanding 35,853,200 62,863,166 35,751,628 53,820,841 Adjusted EPS 0.12 0.06 0.37 0.16 17