FSO US EXPORTS Euronav – Company presentation July 2017 1
Forward Looking Statements Matters discussed in this presentation may constitute forward-looking statements under U.S. federal securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect the Company’s current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including, without limitation, the delivery of vessels, the outlook for tanker shipping rates, general industry conditions future operating results of the Company’s vessels, capital expenditures, expansion and growth opportunities, bank borrowings, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this presentation are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the failure of counterparties to fully perform their obligations to us, the strength of the world economies and currencies, general market conditions, including changes in tanker vessel charter hire rates and vessel values, changes in demand for tankers, changes in our vessel operating expenses, including dry-docking, crewing and insurance costs, or actions taken by regulatory authorities, ability of customers of our pools to perform their obligations under charter contracts on a timely basis, potential liability from future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists. We undertake no obligation to publicly update or revise any forward looking statement contained in this presentation, whether as a result of new information, future events or otherwise, except as required by law. In light of the risks, uncertainties and assumptions, the forward looking events discussed in this presentation might not occur, and our actual results could differ materially from those anticipated in these forward-looking statements. 2
Agenda 1 Introduction to Euronav 2 Financials 3 Industry and Market Overview 4 Conclusion 5 Appendix 3
Introduction to Euronav 2 4
Euronav is the largest tanker company in the world I NTRODUCTI ON FLEET DEPLOYMENT SUMMARY • Leading provider of transportation and storage of Fixed 45 crude oil 23% 40 • The largest tanker ship owner in the world with a fleet of modern high quality VLCC and Suezmax tankers 35 • Best-in-class fully-integrated operating platform 30 No of Vessels • Strong relationships to oil majors and leading energy 25 companies 20 • Conservative financing strategy with a strong balance 15 sheet and high liquidity 10 • Headquarter in Antwerp with ca 150 employees shore Spot side and globally 3,000 seafarers 5 77% • Listed on NYSE & Euronext (TICKER: EURN) with a 0 Fixed Spot market capitalization of USD ~ 1.2 billion Time Charter Spot VLCC Suezmax FSO CURRENT FLEET – TOTAL 5 6 VESSELS – 1 4 .0 MM DW T 1 V – PLUS ( 2 ) 2 FSO 1 9 SUEZMAX ( + 4 NBs) 3 0 VLCC Over 4 4 1 ,0 0 0 DW T 3 8 0 k barrels Up to 3 3 0 ,0 0 0 DW T 1 5 0 ,0 0 0 – 1 6 5 ,0 0 0 DW T Only 4 in w orld fleet Stripped w ater capacity 1MM barrels 2MM barrels 3 MM barrels 2.8 MM barrels 1. Adjusted EBITDA (a non-IFRS measure) represents operating earnings including the share of EBITDA of equity accounted investees before interest expense, income taxes 5 and depreciation expense attributable to Euronav 2. Only 2 V-Plus vessels in world fleet 3. Six vessels have a BWTS installed.
Fleet managed in pool structure provides benefits VLCC POOL SUEZMAX JOI NT VENTURE SUEZMAX CHARTERI NG 5 7 3 6 1 8 ( + 4 NB) 3 5 1 2 1 2 1 2 Other VLCC Tanker Pools ( Ships on the W ater) Main Tanker Clients Heidm ar Navig8 China VLCC – VLCC Seaw olf – VL8 12 36 32 Source: Company reports 15 June 2017 Size is critical to im prove m arket know ledge and achieve the best com m ercial term s 6
Consolidation is happening...and likely to continue Value Adjusted Equity ratio* ( % ) DYNAMI CS I N THE SHI PPI NG I NDUSTRY FRAGMENTED VLCC MARKET OPEN FOR CONSOLI DATI ON Differentiate spot players vs industrial players • Crude tanker business is industrialising Captive or Sovereign fleet Stock listed companies (11) Refers to NB on order within each group total Small owners are data deficient • Low rate environment enables market consolidation • Euronav plays a key role in the consolidation 53 China Merchants (11) Bahri (8) 46 44 China COSCO (9) TANKER MARKET CONSOLI DATI ON 40 NIOC 5 0 % of global 38 300 25% Angelicoussis (7) VLCC fleet DHT 260 MOL 32 controlled by TNK GNRT 31 Top 1 2 ow ners Euronav NV 250 EURN 227 37 20% 26 DHT (2) 206 32 25 Gener8 Maritime (1) 42 200 Num ber of VLCCs / Suezm ax 31 22 Frontline (4) 15% 46 % of VLCCs / Suezm ax 33 Nippon Yussan 19 142 42 150 124 18 SK Holdings 27 116 31 54 26 10% 95 10-15 Ship Owner 17 17 100 22 49 183 4-10 Ship Owner 37 46 32 24 35 30 3 Ship Owner 22 5% 22 34 50 25 2 Ship Owner 34 Data Deficient 39 30 31 30 21 22 30 1 Ship Owner 10 29 11 10 18 16 14 6 5 0 0% Source Clarksons 7 2012 2013 2014 2015 2016 2017 Source Clarksons
FSO – Fixed Income– opportunistic capability FSO – PART OF “BOTTLENECK” PROCESSI NG 3 0 0 K BPD EBI TDA FROM FSO CONTRACTS In 2008, Euronav undertook conversions of 2 ULCC into the largest 2 FSOs in the world Fixed income service contract in Qatar delivering $36mm free cashflow annually until 2022 Vessel Life expectancy extended to 2032 Assets debt free by Q3 2017 CRUDE PROCESSED TO GRADE QUALI TY 8 8 8
Financials 16 9
Strong credit profile VALUE ADJUSTED EQUI TY RATI O ( 1 ) ( % ) LI QUI DI TY ( USDm ) 64% 63% 792 62% 597 48% 383 37% 267 163 2013 2014 2015 2016 Today 2013 2014 2015 2016 Q1-17 EBI TDA FROM FI XED RATE CONTRACTS ( 2 ) ( USDm ) NET DEBT ( USDm ) 1,212 155 155 144 136 1,059 122 921 909 879 2013 2014 2015 2016 Q1-17 2013 2014 2015 2016 2017 (est.) 10 1) Book equity value adjusted for broker valuations 2) On proportionate basis covering all joint ventures
Strategy of strong capital allocation Leverage STRONG BALANCE SHEET HEDGE TOW ARDS CYLI CALI TY CURRENT LI QUI DI TY ( USDm ) • Tanker business is cyclical, towards which the only cure is to have a strong balance sheet and a liquidity pool • Euronav has a very strong liquidity pool that creates a 3 year runway through the cycles • Policy to retain two years of operational liquidity at all times and maintain strong banking relationships As evidenced by CAPI TAL ALLOCATI ON KEY TO GROW TH STRATEGY ACQUI SI TI ON CRI TERI AS Since 2 0 1 4 HI GH DI VI DEND 2 5 VESSELS + 1 . KEEP STRONG BALANCE SHEET 2 1 YI ELD ACQUI SI TI ON 2 . RI GHT MI X OF EQUI TY & DEBT MAINTAIN STRONG BALANCE SHEET ≈ 50% 3 . KEEP OR LOW ER AVERAGE BREAK-EVEN ( Leverage) 11
Strong financial profile offsets cyclicality & seasonality 1 YEAR TC VLCC SEASONALI TY: AVERAGE MONTHLY VLCC RATE 1 9 9 0 - 2 0 1 6 113k 152k 145k 155k 136k 204k 147k 100,000 100,000 90,000 90,000 80,000 80,000 70,000 70,000 60,000 60,000 50,000 50,000 low 40,000 average 40,000 high 30,000 30,000 20,000 Source Clarksons Source Clarksons Cash break even 10,000 20,000 0 10,000 0 • Cash flow breakeven (1) 2017: – ~ USD 18,500 / day for VLCC ~ USD 15,750 / day for Suezmax 12 (1) Before fixed term contracts
Long term financing on attractive terms REPAYMENT SCHEDULE AND RCF REDUCTI ONS 500 Leverage Repayments Balloon Unsecured Bond Reductions 450 400 350 300 250 200 150 100 50 0 2017 2018 2019 2020 2021 2022 2023 HI GHLI GHTS Bank loan margins between 1.225% and 2.25% No material debt maturities until 2020 Most of the secured bank debt is revolving Revolving credit facilities reduce by $138m/ year Strong relationships with the leading international shipping banks Cash debt amortizations on term loans: $55m/ year 13
Industry and Market Overview 5 14
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