Presentation of Q2 2010 results 1 Safe Harbour Statement Matters - PowerPoint PPT Presentation

Presentation of Q2 2010 results 1

Safe Harbour Statement Matters discussed in this presentation may constitute forward-looking statements. Such statements reflect TORM's current expectations and are subject to certain risks and uncertainties that could negatively impact TORM's business. To understand these risks and uncertainties, please read TORM's announcements and filings with The US Securities and Exchange Commission. The presentation may include statements and illustrations concerning risks, plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, TORM's examination of historical operating trends, data contained in our records and other data available from third parties. As many of these factors are subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, TORM makes no warranties or representations about accuracy, sequence, timeliness or completeness of the content of this presentation. 2

Highlights Financial Highlights for Q2 2010 Tanker market Dry bulk market Finance CSR Summary Financials (USDm) EBITDA in Tanker and Bulk Division EBITDA of USD 24m in Q2 2010 compared to USD 35 31 31m in Q2 2009 30 24 23 25 • The Tanker Division is positively impacted by 19 20 higher spot rates and lower expenses in Q2 13 15 2010 10 • The Bulk Division is impacted by better spot 3 5 -2 -1 rates in Q2 2010. Q2 2009 was impacted by 0 USD 13m from sale of vessels Tanker Division Bulk Division Non-allocated Total -5 Q2 2009 Q2 2010 USD/day TORM Pool spot earnings vs benchmarks Q2 2010 20,000 19% 18,000 31% 16,000 51% 14,000 12,000 Achieved spot rates exceed benchmarks 10,000 • Large and high quality fleet 8,000 • Strong worldwide customer base 6,000 • Cooperation on key functions 4,000 2,000 0 LR2 LR1 MR Pool Benchmark *Benchmarks are based on: 3 • LR2: TC1 (Ras Tanura-> Chiba) spot earnings from Clarksons • LR1: TC5 (Ras Tanura-> Chiba) spot earnings from Clarksons • MR: Avg. of spot earnings on TC2 (Rotterdam->NY), TC4 (Singapore-> Chiba) and Curacao->NY from Clarksons

Strong foundation – organisation in place and commercial Highlights Tanker market Dry bulk market Finance relationships intact CSR Summary Organisation in place Large fleet A strong team in place Manage a fleet of 128 product • New forces with international tankers and 11 Bulk carriers at outlook and with many years of 30 June 2010 tanker experience • Tina Revsbech, Head of Tanker Fleet development since Q1: • 14 vessels to leave the pools Division Well positioned to • Jan Nørgaard Lauridsen, • 8 new vessels added to the exploit improving Regional Managing Director TORM fleet during Q2 and Q3 product tanker Asia-Pacific and Head of market going Singapore office forward • New Management in the Bulk Division to be announced • Complement our current organisation which has demonstrated strength and effectiveness during this transition period 4 4 4

Highlights Improved but fragile conditions on the product tanker market Tanker market Dry bulk market Finance CSR Summary Freight rates (MR and LRs) USDt Rates generally low in Q2 2010 – but stronger than MR spot rates and 1 year T/C rates 30 Q2 2009 • Seasonal - coming out of the winter market • Improved underlying fundamentals 20 Positive 10 • Continued naphtha demand • Some strength in emerging routes, • Transatlantic MR strength late June as arbitrage 0 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 opens MR spot rates (TC2) MR 1 year T/C rates Negative • Continued high influx of tonnage TC2 spot avg 2005-2009 • New deliveries (net 2%) although with significant USDt LR1 and LR2 spot rates and 1 year T/C rates delay 40 • Reduced floating storage • Low US demand for gasoline 30 • No swap of LRs into dirty due to the weak market 20 Into Q3 • Closure of the transatlantic arbitrage 10 • General increase in demand across segments • Steady naphtha demand 0 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 LR1 spot rates (TC5) LR1 1 year T/C rates LR2 vessel size (Long Range): Aframax tanker 85-120,000 dwt LR2 spot rates (TC1) LR2 1 year T/C rates LR1 (TC5) spot avg. 2005-2009 LR2 (TC1) spot avg 2005-2009 LR1 vessel size (Long Range): Panamax tanker 60-85,000 dwt 5 MR vessel size (Medium Range):Handymax tanker 40-60,000 dwt *Source: Clarksons SR vessel size (Short Range): Handysize tanker – 30-40,000 dwt

For MR’s emerging cargoes and trades were explored Highlights Tanker market Dry bulk market Finance Alternative trading patterns CSR Summary The traditional transatlantic MR trade route (TC2) rate weakened into mid-June why owners sought alternative cargoes and destinations • Distilled products (Gasoline and Gasoil) to South America • Gasoline due to price difference to Ethanol • Gasoil for heating • Vegetable oil to Asia • Classic TC2 trading route Palm oil to Europe Emerging trading routes Reduced number of ships on the continent The price gap between Europe and the USA widened Price difference USA minus Europe 100 80 Late June, the price difference of gasoline in 60 Europe and USA widened $/T 40 Increased demand for vessels on the continent , 20 which were scarce due to the emerging trades 0 -20 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Gasoline price difference in $/T 6

Floating storage – reduced to natural level during Q2 2010 Highlights Tanker market Dry bulk market Finance CSR Summary Floating storage has been reduced significantly… mbbl Clean products on floating storage* 120 100 80 60 • Floating storage has decreased from significant 40 level in 2009 20 • Adding significant tonnage into the market during 0 both Q2 and Q1 2010 Jul -09 Oct -09 Jan -10 Apr -10 Jul -10 • By end Q2 2010, the level has been reduced to ~3% of the global fleet compared to ~12% by year end 2009 ..as price differential has decreased 6 month vs 1 month future • Floating storage is among others impacted by the 60 steepness of the contango curve on the various products 50 Difference in price 40 30 Smax LR2 30 0 20 10 40 VLCC No of vessels (26 Jul 20010) Floating storage volumes* No of vessels LR1 20 10 0 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 7 6 month vs. - 1 month future *Source: Inge Steensland and TORM research

Highlights Product Tanker market - Tanker market Dry bulk market Finance demand will outgrow supply from 2010 to 2012 CSR Summary Demand and supply development (2010 - 2012) Swing factors: Demand Supply 750 Number of vessels* • Order book delays 64 • Delays in refineries 107 121 500 • Floating storage 82 84 41 447 • Slow steaming 531 50 250 • Changes in transport 371 272 patterns 0 Arbitrage/cross Growth in oil Increasing port Total supply LR into dirty Total demand Phase out & Swing factors Order book gross expansions Cancellations Refinery Scrapping increase demand Delivered + increase market … Est. Changed assumptions: days trade/ • Cancellation set to 10% • Impact from SR fleet development now neutral Source: Torm research *All effects are recalculated into MR units – to enable comparision based on their volume relative to MR Demand primarily driven by Supply primarily driven by • Delivery of 107 MR equivalents in Q1 • Refinery expansions in the Middle East and • LR into dirty India • Some LR1 vessels are replacing Panamax • Increased oil demand phaseouts in crude • Increasing port days due to increased • 30% of LR2 vessels are trading in the crude activity/bottlenecks • Phase-out of single hulls and scrapping of old • Arbitrage tonnage 8

Highlights Improved underlying economic fundamentals Tanker market Dry bulk market Finance CSR Summary Modest but steady pace in Oil demand coming back to pre 2008 Asia main driver for oil demand economic upturn levels • One of the deepest cycles in record • Asia, mainly China key driver for • GDP forecast for the global increase economy held relatively steady • Oil demand back to 2008 levels • US slowly regaining • Economic activity has continued to • Repeated upwards adjustments from increase • Europe and Japan lagging • EIA But modest and • some activity slow down at the end of Q2 2010 Oil demand ... driven by china Momentum remains mb/d Index Growth in oil demand, 2011 mb/d 88 1,6 1,4 87 1,2 1,0 0,8 86 0,6 0,4 85 0,2 0,0 84 -0,2 -0,4 83 82 2007 2008 2009 2010 2011 9 Sources: EIA, (July) EcoWin