Double Double in Ten I NVESTOR P RESENTATION A Strategic Review - PowerPoint PPT Presentation

A LGOMA C ENTRAL C ORPORATION Double Double in Ten I NVESTOR P RESENTATION A Strategic Review Algoma Central Corporation J ANUARY 2018 Board Of Directors Sept 9th, 2015

For orward rd Lo Look oking ng St Statem ements ents Certain statements in this document about our current and future plans, expectations and intentions, results, levels of activity, performance, goals or achievements or any other future events or developments constitute forward-looking statements. Forward-looking statements are based on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate and reasonable in the circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct. Many factors could cause our actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements. The purpose of the forward-looking statements is to provide the reader with a description of management's expectations regarding the Company's financial performance and may not be appropriate for other purposes; readers should not place undue reliance on forward-looking statements made herein, recognizing that all such forward looking information is based on assumptions about the future that may not ultimately be born out and are subject to many risks and uncertainties, including those listed above. Furthermore, unless otherwise stated, the forward-looking statements contained in this document are made as of the date of hereof (unless stated to be as of an earlier date), and we have no intention and undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement. Management approved the forward looking financial information as of January 5, 2018. Certain figures included herein are non-GAAP measures. Please see our MD&A for further discussion of Non-GAAP disclosures. ALL AMOUN OUNTS IN C$ MILLION IONS EXC XCEPT EPT PER R SHARE RE AMOUN OUNTS, , UNLES ESS NOTED ED Short Sea Shipping is OUR BUSINESS 2

Algom oma a Cent ntral ral Corpo orpora ration tion • The largest owner and operator of dry and liquid bulk carriers on the Great Lakes – St. Lawrence Waterway. • A Canadian shipowner since 1900 – 60 vessels globally • 2,000 employees • Trailing twelve months: - Revenue - $443 million - EBITDA - $105 million • Listed on TSX – ALC • Current quarters dividend – 9¢ • Shares outstanding – 38,552,315 • Insider interest – ~78% Short Sea Shipping is OUR BUSINESS 3

Vision Growi wing g our po posit itio ion as t the e carri rier er of choice oice for r bul ulk k commo mmodi diti ties es in in the e Grea eat Lak akes es – St. Lawren ence ce Water erway y to bec ecom ome e a lea eade der in in short t sea ea ship ippi ping gl g globall lly. Short Sea Shipping is OUR BUSINESS 4

Highl Hi hligh ghts ts of of 2017 Cont ntinu inuati tion n of Great at Lakes es dry-bu bulk lk fl fleet eet renewal al prog rogram: ram: • 2 new vess ssels s added d to opera rati tion ons: s: - Algoma Strongfield (Gearless Bulker) - Algoma Niagara (Belt Self-Unloader) • Took deliver ery of the Algoma ma Innovator or from the Uljani nik k d.d. d. shipya yard d in Croati tia – will join domestic estic fleet t in March. ch. Acquired Ac ired four river-cla class ss vess ssels s from America ican Steamship mship Compa pany y • at year end. Short Sea Shipping is OUR BUSINESS 5

Highligh Hi ghts ts of 2017 Expansion of Global Short Sea Shipping: • Ex Expande nded d ceme ment nt fleet t opera erati ting ng un under der NovaAlgom aAlgoma Cemen ement t Carrier iers s (NACC CC) − Fleet now at 11 operating and 2 under development − Includes vessels chartered to two Canadian producers • Acqui uired red a 50% intere erest st in a comme mmercia cial l platform orm and d fleet t focused ed on sh shor ort-sea mini i bul ulker er mark rket t to creat ate e NovaAlgom goma Shor ort-Se Sea Carrier iers s (NASC ASC) − Owned fleet of 15 vessels and overall fleet of 60 vessels Short Sea Shipping is OUR BUSINESS 6

Dives vestiture titure of of R Real Estat ate • Sale proceeds of $104 million to date. • Station Mall in Sault Ste. Marie will be placed on the market in the future. • Strengthens balance sheet and provides funds for growth opportunities. Short Sea Shipping is OUR BUSINESS 7

Inves vestme tment nt The hesis Leader in Our Markets – This is Sustainable History of Performance in a Variety of Markets Diversified, Dependable Customer Base Well Capitalized to Pursue Growth Investing in Future Opportunities Internationally Strong History of Dividends Short Sea Shipping is OUR BUSINESS 8

Gro rowing wing Cash h Fl Flow w and nd Earnings rnings Short Sea Shipping is OUR BUSINESS 9

Diver versif ified d Busines iness Short Sea Shipping is OUR BUSINESS 10 10

Gro rowing wing from rom a St Strong rong Fi Fina nancial ncial Base Current Yield - 2.3% Short Sea Shipping is OUR BUSINESS 11 11

202 025 5 St Strat rategic gic Vision • Continuat ntinuation ion of Great at Lakes es dry-bulk ulk fleet t rene newal l progr gram am Ex Expansion nsion into o globa bal l shor ort t sea shipping ing • Short Sea Shipping is OUR BUSINESS 12 12

Buildi lding ng a You oung nger, Mor ore Effi ficie cient nt Fl Fleet et 40 35 30 25 20 15 10 5 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Short Sea Shipping is OUR BUSINESS 13 13

The he Gre reat t La Lakes Sho hort-Sea Sea Shi hippi pping ng Com ompa pany • Trip times es − Shorter than international trips with less time in open waters • Load / Un Unload ad − More material to overall voyage duration − Port delays can have significant impact on voyage P&L − Integration with customers' supply chains Feeder er service ice for export t – bound nd products cts • • Trans-ship ippi ping ng Short Sea Shipping is OUR BUSINESS 14 14

Our r St Stra rategy egy Goi oing ng For orward rd Grow w into o interna ernati tion onal al shor ort-se sea mark rkets ts where ere we can add value. ue. Target t Mark rket t Fea eature tures: s: • Opportunities for self-unloader or specialized applications to serve as feeder services between shallow draft ports and major seaports. • Opportunities to consolidate small regional operators . • Significant economic growth combined with growth in urbanization and infrastructure development. • Acceptable legal, regulatory, financial and labour market frameworks for local investments and foreign control. Short Sea Shipping is OUR BUSINESS 15 15

Set etting ing the he Sc Scene ne World Trade – Global Marine Trends 2030 Global Trade will at least double in the next 20 Years 20 20 10 10 Billion ion Billion ion Tonnes es Tonnes es 2010 2030 Short Sea Shipping is OUR BUSINESS 16 16

Sho hort Sea Shi hippi pping ng to Gro o Grow w Faster Total Main n Drivers: • Demograph aphy (Growing Population, Urbanization) • Rise se of Trade de Blocks ks (EU, NAFTA, ASEAN, UNASUR) • Geograph phy y (Europe, Oceania, S.E. Asia) • Lack of Infrastructur frastructure (India, Indonesia, Philippines, S.America, Africa) • Envi vironm onment ent (“Green” Transport) in Developed Economies • Techno nology gy (unmanned ships, faster cargo handling, improved security) Short Sea Shipping is OUR BUSINESS 17 17

Gro rowing wing Thro hrough ugh Par Partner tnership hip NovaAlgom Algoma NovaAlgoma Algoma Cement ment Carrier rriers s (NACC CC) : Shor ort-Sea ea Carrier rriers (NASC SC) : • Pneumat matic ic cemen ment t carriers s • Leverage client relationships servicing cing glob obal manuf ufact acturers ers • Leverage existing business • Typicall cally time e charter er based sed and contacts /partnerships under long term contracts tracts to • Leverage access to capital suppo port t singl gle e market et • Establish presence in growth markets Short Sea Shipping is OUR BUSINESS 18 18

Aging ng Globa bal Cement Fl Fleet et Total cement carrier fleet (>2,000dwt): 320 vessel • • Average fleet age: 25 year • Average age of scrapping: 33 years Illustrative Vessel in Global Fleet NACC Star in Nice, France Short Sea Shipping is OUR BUSINESS 19 19

NA NACC is No Now # w #2 Globa ball lly 20 20

Strong ong Global bal Footp tprin int NACC POROS NACC TORONTO NACC ALICUDI NACC QUEBEC NACC ITACA NACC STAR NACC PROCIDA NACC PANAREA NACC VIVARA NACC NAPOLI NACC VEGA NACC VALBELLA NACC CAPRI 21 21