Investor Presentation November 20181 - Seaspan Corporation€¦ · This presentation contains...
Transcript of Investor Presentation November 20181 - Seaspan Corporation€¦ · This presentation contains...
1
1Investor Presentation November 2018
2
2
This presentation contains forward-looking statements (as such term is defined in Section 21E of the
Securities Exchange Act of 1934, as amended, or the Exchange Act) concerning operations, cash flows, and
financial position of Seaspan Corporation (“Seaspan”), including, in particular, the likelihood of its success in
developing and expanding its business. Statements that are predictive in nature, that depend upon or refer to
future events or conditions, or that include words such as “continue,” “expects,” “anticipates,” “intends,”
“plans,” “believes,” “estimates,” “projects,” “forecasts,” “will,” “may,” “potential,” “should,” “guidance,” and
similar expressions are forward-looking statements. These forward-looking statements represent Seaspan’s
estimates and assumptions only as of the date of this presentation and are not intended to give any
assurance as to future results. As a result, you are cautioned not to rely on any forward-looking statements.
Forward-looking statements appear in a number of places in this presentation. Although these statements
are based upon assumptions Seaspan believes to be reasonable based upon available information, they are
subject to risks and uncertainties. These risks and uncertainties include, but are not limited to: future growth
prospects and ability to expand Seaspan’s business; Seaspan’s expectations as to impairments of its
vessels, including the timing and amount of currently anticipated impairments; the future valuation of
Seaspan’s vessels and goodwill; potential acquisitions, vessel financing arrangements and other
investments, and Seaspan’s expected benefits from such transactions; future time charters and vessel
deliveries, including future long-term charters for certain existing vessels; estimated future capital
expenditures needed to preserve the operating capacity of Seaspan’s fleet including, its capital base, and
comply with regulatory standards, its expectations regarding future dry-docking and operating expenses,
including ship operating expense and general and administrative expenses; Seaspan’s expectations about
the availability of vessels to purchase, the time that it may take to construct new vessels, the delivery dates
of new vessels, the commencement of service of new vessels under long-term time charter contracts and
the useful lives of its vessels; availability of crew, number of off-hire days and dry-docking requirements;
general market conditions and shipping market trends, including charter rates, increased technological
innovation in competing vessels and other factors affecting supply and demand; Seaspan’s financial
condition and liquidity, including its ability to borrow and repay funds under its credit facilities, to refinance its
existing facilities and to obtain additional financing in the future to fund capital expenditures, acquisitions and
other general corporate activities; Seaspan’s continued ability to meet its current liabilities as they become
due; Seaspan’s ability to remediate any existing material weakness in its internal controls over financial
reporting; Seaspan’s continued ability to maintain, enter into or renew primarily long-term, fixed-rate time
charters with its existing customers or new customers; the potential for early termination of long-term
contracts and Seaspan’s potential inability to enter into, renew or replace long-term contracts; the
introduction of new accounting rules for leasing and exposure to currency exchange rates and interest rate
fluctuations; conditions inherent in the operation of ocean-going vessels, including acts of piracy; acts of
terrorism or government requisition of Seaspan’s containership during periods of war or emergency;
adequacy of Seaspan’s insurance to cover losses that result from the inherent operational risks of the
shipping industry; lack of diversity in Seaspan’s operations and in the type of vessels in its fleet; conditions in
the public equity market and the price of Seaspan’s shares; Seaspan’s ability to leverage to its advantage its
relationships and reputation in the containership industry; compliance with and changes in governmental
rules and regulations or actions taken by regulatory authorities, and the effect of governmental regulations
on Seaspan’s business; the financial condition of Seaspan’s customers, lenders, refund guarantors and other
counterparties and their ability to perform their obligations under their agreements with us; Seaspan’s
continued ability to meet specified restrictive covenants and other conditions in its financing and lease
arrangements, its debt instruments and its preferred shares; any economic downturn in the global financial
markets and export trade and increase in trade protectionism and potential negative effects of any
recurrence of such disruptions on Seaspan’s customers’ ability to charter Seaspan’s vessels and pay for
Seaspan’s services; some of Seaspan’s directors and investors may have separate interest which may
conflict with those of its shareholders and they may be difficult to replace given the anti-takeover provisions
in Seaspan’s organizational documents; taxation of Seaspan’s company and of distributions to its
shareholders; Seaspan’s exemption from tax on U.S. source international transportation income; the ability
to bring claims in China and the Marshall Islands, where the legal systems are not well-developed; potential
liability from future litigation; and other factors detailed from time to time in Seaspan’s periodic reports.
Forward-looking statements in this presentation are estimates and assumptions reflecting the judgment of
senior management and involve known and unknown risks and uncertainties. These forward-looking
statements are based upon a number of assumptions and estimates that are inherently subject to significant
uncertainties and contingencies, many of which are beyond Seaspan’s control. Actual results may differ
materially from those expressed or implied by such forward-looking statements. Accordingly, these forward-
looking statements should be considered in light of various important factors listed above and including, but
not limited to, those set forth in “Item 3. Key Information—D. Risk Factors” in Seaspan’s Annual Report for
the year ended December 31, 2017 on Form 20-F filed on March 6, 2018, and the “Risk Factors” in Report
on Form 6-K that are filed with the Securities and Exchange Commission, or the SEC, from time to time
relating to our quarterly financial results.
Seaspan does not intend to revise any forward-looking statements in order to reflect any change in
Seaspan’s expectations or events or circumstances that may subsequently arise. Seaspan expressly
disclaims any obligation to update or revise any of these forward-looking statements, whether because of
future events, new information, a change in Seaspan’s views or expectations, or otherwise. You should
carefully review and consider the various disclosures included in this Annual Report and in Seaspan’s other
filings made with the SEC, that attempt to advise interested parties of the risks and factors that may affect
Seaspan’s business, prospects and results of operations.
Notice on Forward Looking Statements
3
3
Container Shipping Is An Essential Part of Global Commerce
ChinaShoe Store
Liners load and unload goods across ocean routes just as couriers operate routes through land and air
4
4
Container Shipping Industry Value Chain
Manufactured goods for distribution
Land transport to distribution
centers
Loading of cargo at port
terminals
Unloading of cargo at port
terminals
Land transport to destination warehouse
Delivery to customer
Seller BuyerEnd buyer of shipments
(importers / exporters)
Shipper Destination
Warehouse
Destination Port
ConsigneeOrigin
Warehouse
Origin Port
Shipping Line
Shipping voyage
via container
ships
Freight-Forwarder
5
5
Containerization & Global Trade
Container
Shipping’s first
downturn since
1998
1.2%
1.6%
2000-2007 2011-2018E
2001: China joins
WTO2011: China becomes 2nd
largest global economy
Container shipping accounts for 17% of global shipping by weight but 60% by value (over $12 trillion of
goods in 2017)3
Global TEU Trade CAGR: 9.9%
Global GDP2 CAGR: 3.4%
TEU to GDP Multiple: 2.9x
4.4%
2.9%
1.3x 1.5x
1978: China
Economic Reforms
1990: Social Market
Economy of China
(TEU, millions1)
1. Clarkson’s Research – October 2018
2. GDP Source: World Bank
3. Statista Container Shipping Statistics & Facts
412
67 7076
8495
105117
129135
122
139150 155
163171 175
182193
203
'73 '83 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18F
6
6
112 Vessels
98%Average Utilization Since IPO3
4,500 employees4,300 Seafarers
200 Corporate
#1Independent Containership
Owner / Operator
6 yearsAverage Age
5 yearsAverage Remaining Charter Period
$5.1bnContracted Future
Revenue2
Relationships with
7 of 8Leading Liners
$414mn Cash Flow from Operations (TTM)1
Integrated with Global Trade Modern Fleet Strong Financial Profile
Seaspan at a Glance
1. Based on trailing 12 months as of September 30, 2018
2. Minimum future revenues to be received on committed time charter party agreements and interest income from direct financing leases as of September 30, 2018. Minimum future
revenues are based on 100% utilization, relate to committed time charter party agreements currently in effect, and assume no renewals or extensions
3. Average fleet utilization from 4Q05 to 3Q18
$1.0bn Revenue (TTM)1
7
7
Issued $345mn
unsecured listed
bond
Seaspan Has Led the Industry Since Its Infancy
13# Vessels 23 29 35 42 55 65 69 71 77 85 87 89 112
51 64108
143 158 187
265
353405 414
474
578621
666
906
IPO 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 3Q18
> 10,000 TEU
8,500 - 9,600 TEU
4,250 - 5,100 TEU
< 3,500 TEU
SCLL, predecessor of Seaspan
Corp, founded by Kyle Washington
and two others
Issued $250mn Series C Preferred Equity (1st
U.S. listed preferred by containership lessor)
Containership JV with The Carlyle Group
Acquired Seaspan
Management Services
$600mn SSW IPO
(largest ship leasing)
Washington Family
invested $180mn
Completed $1.6bn GCI
acquisition
Secured $1.0bn
investment from Fairfax
2000 2005 2010 2015 2018
Utilization 100% 99% 99% 99% 100% 99% 99% 99% 98% 99% 99% 96% 96% 98%
8
8
Key Recent Developments
New
Leadership
Team
David Sokol appointed as Chairman
Bing Chen appointed as President and CEO
Ryan Courson appointed as CFO
Tina Lai appointed as CHRO
Torsten Pedersen appointed as EVP Ship Management
Ted Chang appointed as General Counsel
Fairfax
Investments
Secured a $1.0bn investment from Fairfax Financial Holdings
(leading Canadian insurance company)
– $250mn debt investment funded in February 2018 and
$250mn equity investment funded in July 2018
– Committed to fund an additional $250mn equity
investment and an additional $250mn of debt in January
2019
Acquisition of
GCI
Completed accretive $1.6bn acquisition of remainder of Greater
China Intermodal Investments LLC (GCI) in March 2018
Considerations to selling shareholders was ~$330mn in cash
and a ~$50mn issuance of Seaspan Series D preferred shares
Transaction expanded Seaspan’s platform, diversified our
customer base, and enhanced our fleet composition
GCI was quickly and flawlessly integrated
David Sokol Bing Chen Ryan Courson
Tina Lai Torsten Pedersen Ted Chang
9
9
Washington Family
34% 28%2
Fairfax22% 36%2
Others45% 37%2
Controlling Shareholders
WashCo owns an investment portfolio of industrial companies in
rail transport, mining, and aviation
Seaspan’s founding, and largest current shareholder (34% of
shares outstanding)1
Actively involved with Seaspan since its founding
Dennis Washington made a $160mn Series A Preferred Equity
investment in 2009 during the recession
Fairfax (TSX:FFH) is an insurance and investment management
company with $65bn in assets1
Strategic partner with long-term investment horizon
Initial investment of $500mn ($250mn debt/$250mn equity)
Additional 25mn warrants issued with strike price of $8.05
Second investment of $500mn expected to fund in January
2019 ($250mn debt/$250mn equity)
Current Shareholder Base1
New Chairman, CEO, and CFO have accessed new capital sources and strengthened commercial position
with the acquisition of GCI
1. As of September 30, 2018
2. Pro forma committed exercise of Fairfax’s 38.5mn warrants in January 2019
10
10
Diversified and Flexible Financial Profile
Diversified across multiple pools of capital
Track record of capital markets access and execution
Over 40 global lenders, including North American, European,
and Asian financial institutions
Supportive investor base
24 unencumbered assets2 with expectation to increase over
time as secured credit facilities mature
Selected Global Lenders Unencumbered Asset Pool
Diversified Sources of Capital1
($ millions)
Secured Debt
$3,056
Capital Leases$660
Unsecured Debt$668
Perpetual Preferred
Stock$825
Common Equity$1,994
Corporate Revolver
$150
42%
9% 9%
11%
2%
27%
1. Market value of Common Equity and Perpetual Preferred Stock as of November 11, 2018; Common Equity based on shares outstanding as of September 30, 2018, plus 38.5mn
shares expected to be issued to Fairfax in January 2019 in exchange for an agreed exercise of 38.5mn of warrants; Secured Debt, Capital Leases, Unsecured Debt, and Corporate
Revolver as of September 30, 2018. Corporate Revolver is undrawn and committed in the amount of $150mn
2. Includes 6 vessels securing debt which has been repaid in November 2018
TEU Class Vessel Count2
2,500 2
3,500 2
4,250 14
8,500 2
9,600 2
10,000 2
Total 24
11
11
What Containership Lessors Offer
Liner Companies
Liner Responsibilities:
Sourcing & Aggregating Cargo
Managing Logistics
Fuel Costs
Cargo Operating Expenses
Pays Daily Charter Rate
Fleet of 112 Containerships
Operating Lessor
Lessor Responsibilities:
Vessel
Crew
Technical Operations
Design, Maintenance, Insurance
Variety of Contract Structures
Charter Rate + Term
Fixed-Rate Charter Contract
Charter Rate
Vessel & Crew
+ Services
12
12
Large, Modern Fleet Portfolio Aligned to Key Trade Routes
2,500 TEU
12 Vessels
3,500–4,250 TEU
26 Vessels
4,500–5,100 TEU
9 Vessels
8,500–9,600 TEU
12 Vessels
10,000–11,000TEU
30 Vessels
13,000–14,000 TEU
23 Vessels
Regional
Trades
Workhorses of
Global Fleet
Operating Scale and
Efficiency For Long-
Haul Trades
68% of fleet is >10,000 TEU in size with an average age of approximately three years1
1. Weighted by TEU
13
13
Global Trade Now Requires a Diversified Fleet
Feeder Class Mid-Sized VLCS / ULCS
TEU 2,500 3,500 4,250 5,100 8,500 9,600 10,000 13,100 14,000
Intra‐Asia
Africa
Australia—NZ
Latin America
Europe—NA
Far East—ME
Far East—NA
Far East—Europe
The ideal ship size varies by route, port capacity, and charter needs
Seaspan’s Vessel Trading Activity
14
14
906
784
544 528 469 440
398 393 352 333 280 229 208 206 201 199 199 190 189 180
Sh
oe
i K
ise
n
Costa
ma
re
Zo
dia
c M
ari
tim
e
Bo
Com
Lea
sin
g
Ea
ste
rn P
acific
Sh
g (
EP
S)
Offe
n,
Cla
us P
ete
r
Pe
ter
Dö
hle
/Ha
mm
on
ia
Dan
ao
s S
hg
Min
sh
eng
Fin
an
cia
lL
ea
sin
g
Sh
ip F
ina
nce
In
tern
ation
al
No
rdde
uts
che
R.H
. S
ch
uld
t
Sin
Oce
anic
MP
C G
roup
Schu
lte
Gro
up
Chin
a M
erc
ha
nts
Ban
k
Glo
ba
l S
hip
Le
ase
(P
roF
orm
a)
Navio
s
E.R
. S
ch
iffa
hrt
Te
ch
no
mar
Sh
g
World’s Largest Independent Containership Owner & Operator
Barriers
to Entry
Top 20
Containership
Lessors1
TEU (000s)
Customer Relationships
Operational Track Record and Experience
Scale of Service
Increasing Regulation
Access to Financing
Scale creates meaningful barriers to entry
Primarily a financial lessor
(i.e. limited/no vessel management services)
4
2
3
1. Alphaliner Monthly Monitor – October 2018. Chart of top 20 containership lessors includes current vessels and vessels under construction
2. Shipowning arm of Imabari Shipbuilding
3. Based on company filings
4. Pro Forma for merger with Poseidon Containers
3
15
15
99% 100% 99% 99% 99% 98% 99% 99% 96% 96% 98%
FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 YTD
Fully Integrated Operating Platform
VESSEL DESIGN VESSEL UPGRADESVESSEL OPERATIONSVESSEL MANAGEMENT
1. Fleet utilization rates for the nine months ended September 30, 2018
Bulbous Bow modifications to improve
hull hydrodynamics
Enhanced cargo care practices to safely carry more
containers
Trim optimization to optimize cargo loading
and fuel efficiency
In-House Design
& Engineering Teams
In-house design and engineering teams with
strong relationships with leading shipyards
Deep experience in overseeing new vessel
construction, conversions and marine engineering
Fleet Utilization Rates Impact of Hanjin bankruptcy and drydock
of 4 Panamax vessels acquired in 4Q16
Fleet Management
Commercial Services
Provide crewing and insurance
Responsible for both ordinary and scheduled
maintenance
Disciplined cost control200
Corporate
& Operations
4,500People Employed Globally
>7,5002017 Port Calls
4,300Seafarers
Strong commercial management and long-term
charter profile drives high utilization rates
Recognized for operational excellence with
several recent awards
1
16
16
Contracted Revenues Provide Reliable, Recurring Cash Flows
Cash flow stability from future contracted charter payments of ~$5.1 billion1
with an average remaining contract duration of ~5 Years
Percentage of Contracted Revenue by Year1
92%
83%
72%
58%
2019 2020 2021 2022
Majority of charter expirations post 2022 are
modern 10,000+ TEU vessels
1. Minimum future revenues to be received on committed time charter party agreements and interest income from direct financing leases as of September 30, 2018. Minimum future
revenues are based on 100% utilization, relate to committed time charter party agreements currently in effect, and assume no renewals or extensions. Illustrated as a percentage of
annualized revenue for the last three months ended September 30, 2018
17
17
1. Rank based on market share per Alphaliner as of October 2018, adjusted for COSCO’s planned acquisition of OOCL, and combined world ranking of ONE joint venture (MOL, K Line
and NYK Line)
2. Number of Seaspan’s vessels and TEU of vessels chartered to each liner as of September 30, 2018
3. Credit ratings represent MOL and K-Line, respectively
Strong Counterparties Composed of Top Liners
Seaspan works with a select group of leading liner companies with a focus on long-term charters
Charterer
World
Ranking1
No. of
Vessels²
Total
TEU²
Major
Shareholders Credit Rating
COSCO 3 36 257,250 Government chAAA / Lianhe
Yang Ming 8 16 220,000 GovernmenttwBBB / Taiwan
CR
ONE3 6 21 147,900 Widely-held(Ba1 / NR) /
(BBB / NR)
MSC 2 7 67,750 Family-owned (N/A)
CMA CGM 4 10 71,250 Family-owned B1 / B+
Hapag
Lloyd5 7 58,500 Widely-held B2 / B+
Maersk 1 7 49,250 Widely-held Baa2 / BBB
Other - 8 34,000 –
Total 112 905,900
(by % of total TEU)
Other
28%
24%16%
8%
8%
7%
5%4%
18
18
Seaspan’s Business Model
Fully Integrated
Operating Platform
Long-Term, Fixed-
Rate Charters
Creditworthy
Customers
Comprehensive operating leasing platform
Design and acquire large, modern, fuel-efficient vessels
In-house full vessel life cycle management expertise
Long-term charters between 3 and 17 years provide
stable, predictable cash flows
Average remaining life of long-term charters of ~5 years
Lease vessels to the world’s leading liners
Operate customers’ flagship assets
Largest customers are partially government owned
Seaspan’s differentiated business model allows it to capitalize on challenges currently facing the containership
leasing industry and provide best-in-class service
Commoditization
Short-Term Focus
Weak Credit Profiles
Challenges to
Containership IndustrySeaspan’s Model
Size & Scale World’s largest containership lessor
Leverage scale to secure major transactions and cost
savings
Fragmentation
19
19
Market Share October 2018
Top 8 Liners Grew Market Share from 55% to ~85% in 5 Years1
APM‐Maersk, 18%
MSC, 15%
CMA CGM, 10%
Evergreen, 5%COSCON, 5%Hapag‐Lloyd,
4%
APL, 4%
Hanjin Shg, 4%
CSCL, 4%
MOL, 4%
OOCL, 3%
Hamburg Süd, 3%
NYK, 3%
Yang Ming, 2%
K Line, 2%
Hyundai M.M., 2%
Others, 11% Maersk+H.Sud, 19%
MSC, 16%
COSCO + OOCL, 14%
CMA CGM, 13%
Hapag+UASC, 8%
ONE, 7%
Evergreen, 6%
Yang Ming, 3%
PIL, 2%
Others, 12%
1. Alphaliner Monthly Monitor – October 2018
Concentration of Liner Market Share
Market Share 2013
20
20
The fragmented landscape leaves significant room and benefit for consolidation
Opportunity for Lessor Consolidation
Consolidation provides greater economies of scale
and barriers to entry
Access to financing
Customer relationships
Scale of service
Larger, more diverse fleets provide significant benefits
Size and scale allows for improved credit profiles and
reduced cost of capital
Shoei Kisen, 7%
Costamare, 5%
Zodiac Maritime, 4%
BoCom Leasing, 4%
Eastern Pacific Shg (EPS), 4%
Offen, Claus Peter, 3%
Peter Döhle/Hammonia,
3% Danaos Shg, 3%
Minsheng Financial Leasing, 3% Norddeutsche
R.H. Schuldt, 2%
Other, 55%
, 8%
1. Alphaliner Monthly Monitor – October 2018
Opportunity for ConsolidationContainership Lessor Market Share1
21
21
Demand Growth and Supply Constraint Driving Rate Improvement
Improving fundamentals driving charter rate improvement across
asset classes
Support from limited number of deliveries scheduled for 2018
and 2019, and continuing restraint on newbuild ordering
Charter Rate Improvement1
Historical Containership Asset Value Improvement1
Asset values are on an upward trajectory
Momentum in sale and purchase markets has
continued into 2018, with significant deal flow
worldwide
0%
50%
100%
150%
200%
250%
300%
350%
Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18
Rate
per
day,
Ind
ex =
100
2500 TEU3500 TEU4400 TEU9000 TEU
60%
80%
100%
120%
140%
160%
180%
200%
Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18
US
$ M
illio
ns,
Ind
ex =
100
2,600 - 2,900 TEU 3,200 - 3,600 TEU 8,500 - 9,100 TEU
1. Clarksons Research – October 2018
22
22
Broad Based Global Seaborne Trade Growth
2017 growth was broad based, in both primary and secondary
trade lanes
2018 growth has remained robust despite trade uncertainty
Growth outlook supported by strong economic fundamentals in
emerging and developed markets
Good utilization on main trades: Eur/Asia ~90%, Asia/US ~95%
Broad Based Growth Across Regions1
2017 Growth Rates by Region
8.8%
6.0%5.5%
5.0% 5.0%4.5% 4.3% 4.1%
3.5% 3.2% 2.8%
India
n s
ub
-con
t.
So
uth
Eu
rop
e
SE
Asia
Afr
ica
Oce
an
ia
Latin
Am
erica
No
rth A
meri
ca
Ch
ina
+H
K
No
rth E
uro
pe
Mid
dle
Ea
st
Oth
er
Nort
hA
sia
12% 7% 6% 4% 8% 7% 8% 8% 5% 2% 5%
Demand growth has outperformed supply over the last two years
Improving supply / demand balance supporting charter rates
Trade growth is expected to exceed fleet growth in 2019
Annual Capacity and Throughput Growth1
1. Alphaliner Monthly Monitor – October 2018; Global port throughput includes empty container and transshipment cargo
(15%)
(10%)
(5%)
–
5%
10%
15%
20%
–
5
10
15
20
25
TE
U (
mlli
ons)
Fleet Capacity (TEU) Throughput Growth
Capacity Growth
(15%)
(10%)
(5%)
–
5%
10%
15%
20%
–
5
10
15
20
25
TE
U (
mlli
ons)
Fleet Capacity (TEU) Throughput Growth
Capacity Growth
23
23
Idle Fleet Continues to Decline (% TEU)1,2
Orderbook at Historically Low Levels1,2
Industry supply rationalization and demand improvement driving
idle fleet reduction and supporting time charter rate improvement
Idle containership fleet of vessels over 500 TEU less than 180, or
2.3% of the global fleet2
2016 demolition reached an all-time high and remained elevated
in 2017
2018 scrapping down to ~44k1 TEU YTD as market recovery
continues
Historical Demolition Volumes2
Improvement in Industry’s Ability to Manage Supply
Fewer operators and increased discipline tempering supply
growth
Orderbook-to-fleet ratio currently at 13.0%2
Orderbook delivery schedule continues to get pushed out
18
22
26
30
0
200
400
600
2012 2013 2014 2015 2016 2017 2018 YTD
Avera
ge A
ge (yrs
)
TE
U (
000's
)
TEU Scrapped Other Deletions Average Age (Scrapped Units)
2.3%
0.0%
4.0%
8.0%
12.0%
0
450
900
1,350
1,800
2010 2012 2014 2016 2018
Total Idle TEU Idle Fleet as % of Total Fleet
13.0%
0%
25%
50%
75%
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
1. Clarksons Research – October 2018
2. Alphaliner Monthly Monitor – October 2018
24
24
Strong Tailwinds For Those Well-Positioned
Focus on Capital Allocation
We are focused on allocating capital selectively into opportunities that improve the long-term value of the
business, and have strong risk-adjusted returns on capital
Seaspan Well-Positioned for the Future
We are strengthening our balance sheet and cash flows to become a platform for growth and
consolidation in the containership industry
Other Capital Allocation Opportunities
Synergistic opportunities in adjacent businesses (both horizontal and vertical)
We will assess opportunities as they arise based on a prudent approach to capital allocation and risk-
adjusted returns
Improving Industry Dynamics
Robust demand and improving supply fundamentals will continue to support charter rate improvement
25
25
Our Five Key Priorities
1
Operational Excellence
Set standard for best-in-class service
Optimize cost structure through scale advantage
Customer Partnerships
Provide value-added services
Best-in-class solution provider to customer needs
Financial Strength and Stability
Maintain financial discipline and enhance company credit quality
Maximize cash flows via full life-cycle management
Pursuit of Growth Opportunities
Newbuilds, second-hand vessels, and assets/portfolios
Asset and business acquisitions in the shipping industry and beyond
Capital Allocation
Strengthen balance sheet and liquidity
Reinvest capital into opportunities with strong risk-adjusted returns
2
3
4
5
26
26
APPENDIX
27
27
$343 $336 $311 $323
$414
2014 2015 2016 2017 TTM
$717
$819 $878
$831
$1,016
2014 2015 2016 2017 TTM
Financial Performance
Revenue1
Utilization1
Cash Flow From Operations1
Operating Earnings1
99% 99% 96% 96% 98%
2014 2015 2016 2017 TTM
$330 $351
$7
$303
$416
2014 2015 2016 2017 TTM
Impact of Hanjin bankruptcy and drydock
of 4 Panamax vessels acquired in 4Q16
($ millions) ($ millions)
($ millions)
1. TTM based on trailing 12 months as of September 30, 2018
2. $285mn vessel impairment charge incurred in 2016
$285mn
impairment
charge2
28
28
Senior Leadership Team
Appointed CEO of Seaspan in January 2018
25 years of executive experience in building multiple businesses across industries,
including finance and asset leasing businesses, in US, Europe and Asia
Previously CEO of BNP Paribas (China) Ltd.
Bing Chen
President and
Chief Executive Officer
Ryan Courson
Chief Financial Officer
Appointed CFO of Seaspan in May 2018
Former Senior Vice President of Corporate Development
Previous experience at Falcon Edge Capital, Teton Capital and Berkshire Hathaway
David Sokol
Chairman
Appointed Director of Seaspan in April 2017 and Chairman in July 2017
Currently serves as a director of The Washington Companies
Over 38-year business career, founded three companies, took three companies
public and sold MidAmerican Energy Holdings Co. to Berkshire Hathaway in 2000
Peter Curtis
Executive VP and Chief
Commercial &
Technical Officer
Appointed Executive Vice President in July 2017 and Chief Commercial and Technical
Officer in March 2018
30+ years of experience in shipbuilding, fleet management, engineering, naval design,
and operations
29
29
Key Industry Terms Defined
Industry Players
Companies that transport goods through regular
transit routes on fixed schedules. Container shipping
liners use large containerships to transport goods
from one location to another.
Vessels Measurements
Ship owners who lease their assets to liners,
providing the latter with an attractive alternative to
full ownership of their operating fleet.
A third party that sources and consolidates cargoes
from various beneficial cargo owners and negotiates
with liners to arrange the shipment. Freight
forwarders can also arrange the crucial connection
services and formalities on behalf of a shipper.
Beneficial Cargo
Owners (BCO)
Owner of the goods, who takes full control of their
cargo at point of entry in the country of importation.
Small ships that often distribute cargo between large
hub ports and smaller regional ones.
These ships were the standard in container shipping
for many years, until more recent advances in
shipbuilding provided the means to maximize
economies of scale.
Acronym for “very large container ships.” A segment
which entered the market in 2006,
and have a capacity of 8-14K TEU.
ULCS
Acronym for “ultra large container ships.” The most
recent player to enter the market, with a capacity of
more than 14K TEU. These ships can only call the
largest and deepest ports in the world.
Acronym for “twenty-foot-equivalent” unit. This is the
unit used to measure the capacity of containerships
and terminals. The average long cargo box you see
measures 2 TEU.
Price lessors charge to lease their ships.
The actual box rates Liners charge the end customer
of the goods.
CO2 Emissions
The carbon dioxide emissions produced when using
fuel to drive an engine. The more fuel-efficient or
“green” a ship is, the lower its CO2 emissions will be.
Liners Feeder Class TEU
Charter RatesCharter Providers /
Owners
Freight Rates
Mid-Sized
VLCSFreight Forwarders