May 7 th 2018 Q1 2018 Quarterly presentation
Highlights first quarter 2018 Seasonally weak results with EBITDA adjusted of USD 128 million Underlying positive volume development, especially for high & heavy Ocean results impacted by rate reductions, reduced HMG volumes, increased bunker cost and currency movements Landbased results down due to increased SG&A cost allocations About USD 85 million in synergies confirmed New Corporate Visual Identity and name; Wallenius Wilhelmsen ASA 2
Agenda Business update Financial performance Market and business outlook Summary and Q&A
Business update by Craig Jasienski
Business Update Financial Performance Market and Business Outlook Summary and Q&A Underlying positive volume development offset by reduced contracted Hyundai Motor Group (HMG) volumes Volume and cargo mix development 1 Comments Million CBM and % • Underlying positive volume development offset by Total prorated volumes Cargo mix reduced contracted HMG volumes (up 2% y-o-y) Million CBM % +2% -12% • Increased volumes in all foundation trades excluding 19,5 20 19,4 35 18,7 18,4 18,2 18,2 18,0 AS-NA (especially USWC) where EUKOR had the 17,7 16,2 16,8 16,7 30 16,2 largest reduction in contracted HMG volumes 27,9% 15,9 15,5 15,2 26,0% 26,1% 26,1% 25,7% 25,2% 25,3% 25,4% 15 25,1% 24,9% • Adjusted for reduced contracted HMG volumes (0.5 24,2% 24,0% 25 22,6% 22,6% million CBM) volumes were up about 5% y-o-y 20,4% 20 • Volumes down 12% q-o-q, driven by seasonality and 10 contracted reduction in HMG volumes 15 • Continued positive development for cargo mix with a 10 5 high & heavy share of 27.9% in the first quarter, up from 26.1% in the previous quarter and 24.2% in 5 same period last year 0 0 Q3’14 Q4’14 Q1’15 Q2’15 Q3’15 Q4’15 Q1’16 Q2’16 Q3’16 Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q1’18 1) Prorated volume 2) Calculated based on unprorated volumes. Updated figures based on aligned cargo type definition and reporting across all Ocean units 5
Business Update Financial Performance Market and Business Outlook Summary and Q&A Seasonal reduction in volumes across most foundation trades EU - ASIA Asia - EU Atlantic Shuttle +6% -14% +7% -13% +18% -1% 3.4 3.3 2.9 2.9 2.8 2.7 3.4 3.4 2.9 Q1 ’17 Q4 ’17 Q1 ’18 Q1 ’17 Q4 ’17 Q1 ’18 Q1 ’17 Q4 ’17 Q1 ’18 Asia - NA EU/NA – Oceania 1) -26% -26% 3.3 3.3 +3% -10% 2.4 2.0 1.8 Asia - SAWC 1.7 +22% +1% Q1 ’17 Q4 ’17 Q1 ’18 1.2 1.2 1.0 Q1 ’17 Q4 ’17 Q1 ’18 WWL trade routes EUKOR trade routes Q1 ’17 Q4 ’17 Q1 ’18 ARC trade routes Note: Prorated volumes on operational trade basis in CBM 1) Including Cape sailings (South Africa) 6
Business Update Financial Performance Market and Business Outlook Summary and Q&A Positive development in net freight/CBM despite rate reductions due to changes in trade and cargo mix Net freight / CBM development 1) Comments Indexed to 100 per Q2 2014 105 • Net freight / CBM increased by about 1% in the first quarter compared with the previous quarter due to changes in trade and cargo mix 100 • The largest volume reduction in the quarter was seen in EU-AS and AS-USWC which are trades with 95 relatively low net freight / CBM -4% +1% • Furthermore, the increased high & heavy share also had a positive impact on net freight / CBM 90 • On the other side, rate reductions from contract renewals in 2017 impacted the net freight index 85 negatively with about USD 5 million compared to last quarter and about USD 15 million compared to 80 the same period last year Q2’14 Q3’14 Q4’14 Q1’15 Q2’15 Q3’15 Q4’15 Q1’16 Q2’16 Q3’16 Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q1’18 Note: Unprorated volumes excluding US flag operations 1) Net freight = Revenues adjusted for surcharge elements such as BAF, SRC, THC etc 7
Business Update Financial Performance Market and Business Outlook Summary and Q&A 133 vessels operated at the end of the first quarter Fleet development Comments # of vessels Group Fleet Short Term T/C In/Out • Wallenius Wilhelmsen operated a core fleet of 124 vessels (851K CEU), representing around 20% of the 128 133 128 132 132 132 125 128 125 global fleet in the first quarter 5 6 6 9 • In addition, the group continued to leverage the short- term market and controlled a fleet of 133 vessels at the end of the first quarter, but with less capacity deployed during the seasonally slow January & February months 134 132 130 128 127 127 126 126 124 • The group retains flexibility to redeliver two vessels and up to 19 vessels by 2022 (excl. short term time charters) • Four Post-Panamax vessels are expected to enter service in 2018 and 2019, with remaining installments of about USD 160 million -2 -4 -6 -5 Q1’16 Q2’16 Q3’16 Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q1’18 8
Business Update Financial Performance Market and Business Outlook Summary and Q&A USD 86 million of the USD 120 million synergy target confirmed Confirmed and realized synergy development Comments USD million 120 • At the end of the first quarter USD 86 million of the USD 120 million synergy target was confirmed 86 • During the quarter about USD 10 million was added 76 to confirmed synergies, through a combination of 65 fleet optimization, procurement and SG&A savings 55 • The annualized run rate for synergies were about USD 80 million, up from about USD 65 million in the previous quarter • The remaining part of the confirmed synergies will 0 0 0 gradually come into effect over the next 3-6 months Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Fleet Optimization Procurement Realized savings (annualized) Ship Management SG&A savings 9
Business Update Financial Performance Market and Business Outlook Summary and Q&A Several key developments for landbased in the first quarter Key highlights for landbased • VSA results negatively impacted by high auto inventories causing congestion and reduced operational efficiencies • Melbourne terminal fully operational from January 2018 • Keen Transport being integrated into WW Solutions • WW Solutions credit facility to be increased with USD 150 million to allow for further non-organic growth • Investment and M&A pipeline remains interesting 10
Business Update Financial Performance Market and Business Outlook Summary and Q&A New Corporate Visual Identity and name; Wallenius Wilhelmsen ASA 11
Financial performance raig Jasienski by Rebekka Herlofsen
Business update Financial Performance Market and Business Outlook Summary and Q&A Consolidated results – first quarter 2018 Proforma Comments Q1 2018 Q4 2017 Q1 2017 1) Total income 968 1 036 890 • Seasonally weak results with EBITDA adjusted of USD 128 million, down 10% y-o-y and 30% q-o-q Operating expenses (843) (859) (747) primarily driven by the ocean segment EBITDA 125 177 143 • Extraordinary costs of USD 3 million related to the EBITDA adjusted 128 182 143 restructuring and realization of synergies Depreciation (84) (84) (74) • Net financial items in the first quarter were EBIT 41 93 60 positively impacted by USD 30 million in unrealized interest rate derivatives and USD 3 million related to Net financial items (5) (32) n/a movements in currency Profit before tax 35 61 n/a • Tax expense of USD 25 million in the first quarter, Tax income/(expense) (25) 27 n/a primarily related to changes in deferred tax of USD Profit for the period 10 86 n/a 12 million and provision for withholding tax on EPS 0.02 0.20 n/a dividends from EUKOR of USD 7 million 1) Comparable numbers are pro forma numbers as if the transaction had taken place back in time 13
Business update Financial Performance Market and Business Outlook Summary and Q&A Increased bunker prices and unfavourable currency movements continue to impact the results negatively Currency development 1 Bunker price development USD / ton HFO Basket of currencies Indexed to 100 per Q1 2017 409 USD / Basket of currencies 420 100 100 98 400 372 380 94 94 95 360 335 91 329 340 320 90 320 300 85 280 260 240 80 Q1’17 Q2’17 Q3’17 Q4’17 Q1 ’18 Q1’17 Q2’17 Q3’17 Q4’17 Q1 2018 • • BAF in customer contracts are the main mechanism to manage risk Main currency for both revenues and costs in the operating entities are USD with the majority of revenues in USD while 20% of the operating • The business is exposed to changes in the bunker price since BAF is costs in non-USD currencies (mainly EUR, KRW, JPY, SEK and CNY) calculated based on the average price over a historical period, and then • fixed during an application period, creating a “ 3 month” lag effect (negative The USD has weakened lately causing a negative currency effect of about if prices move up and positive if prices move down) USD 15 million y-o-y and about USD 5 million q-o-q • • Bunker prices continue to move upwards, and results in the first quarter As a main principle, financial instruments are not used to hedge currency were negatively impacted with more than USD 10 million risk in the operating entities (assessment done when USD is historically strong vs. other currencies) 1) Value weighted basket of currencies consisting of USD/EUR, USD/KRW, USD/JPY, USD/CNY and USD/SEK 14
Recommend
More recommend
