Q4 2011 - Awilco LNG
Transcript of Q4 2011 - Awilco LNG
www.awilcolng.no - 1 -
Q4
2011Jon Skule Storheill
Snorre Krogstad
www.awilcolng.no - 2 -
Agenda 28/021. Highlights Q4
2. Company overview
3. Q4 Financials
4. Market update
5. Summary
www.awilcolng.no - 3 -
4th Quarter Highlights
• Awilco LNG ASA reported freight income of MUSD 16.8 (MUSD 12.3 in Q3) and an EBITDA of MUSD 10.9 (MUSD -0.5 in Q3)
• WilEnergy fixed on 200 day contract with option to extend up to max 400 days, commencing in mid-February 2012
• The charters declared the option to extend the period up to 365 days in January 2012, and WilEnergy is thus on contract until February 2013
• WilPower was fixed for a 200 day contract, with commencement end of December 2011
• 2nd installment on both newbuildings paid
• Q4 vessel utilization of 88% vs. 47% in Q3
• Continued strong market in the 4th quarter
Subsequent events
• WilEnergy completed dry dock on 15th of February, on time and below budgeted cost, the vessel commenced a one year charter after bunkering
• Term sheet received for increase of credit facility from MUSD 15 to MUSD 20 with tenor until February 2013
• Newbuilding on track – steel cutting started 20 February on 1st vessel
• 3rd installment paid on 1st vessel
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Agenda 28/021. Highlights Q4
2. Company overview
3.Q4 Financials
4.Market update
5. Summary
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Company overview
Awilco LNG is a pure play LNG transportation provider, owning and
operating LNG vessels in international trade. The company owns three
125,000 cbm LNG vessels: WilGas, WilPower and WilEnergy. In addition,
the company has entered into a newbuilding contract with Daewoo
Shipbuilding & Marine Engineering Co Ltd in Korea for two155,900 cbm
LNG vessels to be delivered during the 3rd and 4th quarter of 2013. The
company is listed on Oslo Axess under the ticker code ALNG.
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Our fleet of 2nd generation vessels
WilGas WilPower WilEnergy
Built: 1984
Yard: Nagasaki
Capacity: 125,631
Manager: V.Ships LNG
Flag: NIS
Main Engine: Steam Turbine
Cap: 2/1
Built: 1983
Yard: Kawasaki
Capacity: 125,660
Manager: V.Ships LNG
Flag: MI
Main Engine: Steam Turbine
Cap: Due next DD
Built: 1983
Yard: Nagasaki
Capacity: 125,556
Manager: V.Ships LNG
Flag: MI
Main Engine: Steam Turbine
Cap: 1
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Order of two newbuildings
Yard: Daewoo Shipbuilding
Cost approximately MUSD 200, depending on final specification
Soft payment terms
Delivery August and November 2013
ICE classed
In total 19 new buildings delivering in 2012 and 2013, only 7 vessels are available for charter
Awilco LNG has on paper the first available new building to be delivered
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Contract overview
WilPower: open August 2012
WilGas: open October 2012
WilEnergy: open February 2013
2012 2013
WilPowerDD
WilGas
WilEnegy DD
Newbuilding
no1Construction
Newbuilding
no 2Construction
Available
Available
Available
Available
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Agenda 28/021. Highlights Q4
2. Company overview
3. Q4 Financials
4. Market update
5. Summary
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Q4 2011 Income statement
Total freight revenue MUSD 16.8
• Mobilization fee MUSD 2.0 (MUSD 3.5 Q3)
Voyage related costs MUSD – 0.7
• Less idle time and repositioning during the quarter
Operating expenses MUSD 3.3
• No “take-over costs” during the quarter (MUSD 0.2 Q3)
Administration exp. MUSD -1.9
• MUSD 0.8 provisions for bonuses, syntethic stock
option and BOD fee
Net Finance
• No interest costs, expenses related to fees
Tax MUSD -1.3
• Non payable in Q4, full year MUSD 0.1 payable
USD million Q4'11 Q3'11YTD
2011
Freight income 16,8 12,3 30,7
Voyage related costs -0,7 -7,5 -10,0
Net freight income 16,1 4,8 20,7
Operating expenses -3,3 -3,7 -12,0
Administration expenses -1,9 -1,7 -4,6
EBITDA 10,9 -0,6 4,1
Depreciation -1,7 -1,7 -3,9
Net Finance -0,2 -1,1 -0,8
Profit/Loss before tax 9,0 -3,4 -0,6
Tax -1,3 -1,3 -2,6
Profit/loss 7,7 -4,6 -3,3
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USD million 31.12.11 30.09.11
Vessels 69,9 69,7
Vessels under construcction 79,2 39,7
Total non-current assets 149,2 109,4
Trade receivables 3,8 7,7
Other short term assest 0,8 4,0
Cash 28,4 52,6
Total current assets 33,0 64,3
Total assets 182,2 173,7
Total equity 171,6 163,3
Long term liabilities 1,9 1,2
Trade payables 2,2 4,9
Other current liabilities 6,5 4,4
Total current liabilities 8,7 9,3
Total equity and liabilities 182,2 173,7
Q4 2011 Balance sheet
Vessels MUSD 149
• Book value of existing vessels MUSD 69.9
• Paid in installment on newbuildings of MUSD 39.5 during the quarter
Current assets MUSD 64.3
• Trade receivables MUSD 3.8 vs. MUSD 7.7 Q3
• Cash MUSD 28.4 vs. MUSD 52.6 Q3
Long term liabilities
• Long term liability deferred tax
• MUSD 15 credit facility not utilized
• No interest-bearing debt
Short term liabilities MUSD 9
• Marginally lower than last quarter
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Q4 2011 Cash flow
Increase in cash from
operations due to:
• Increased profits before taxes
• Reduced trade receivables
• 2nd installment for both newbuildings
paid during 4th quarter
USD million Q4'11 Q3'11 2011
Cash flow from operating
activities:
Profit/(loss) before taxes 9,0 (3,4) (0,6)
Depreciation and amortization 1,7 1,7 3,9
Trade receivables, inventory and other short term assets 5,1 (2,4) (4,6)
Accounts payable, accrued expenses and deferred revenue 1,5 (1,8) 8,6
Net cash provided by operating activities 17,3 (5,9) 7,3
Cash flow from investing activities:
Investment in vessels (1,8) (0,2) (73,8)
Investment in vessels under construction (39,5) (0,4) (79,2)
Investment in other fixed assets (0,1) (0,0) (0,1)
Net cash used in investing
activities (41,4) (0,6) (153,1)
Cash flow from financing activities
Issuance of shares, net of transaction costs - 131,6
Issuance of loan - 39,0
Net cash provided by/ (used in) financing activities - - 170,6
Net changes in cash and cash equivalents (24,2) (6,4) 24,8
Cash and cash equivalents at start of period 52,6 59,0 3,7
Cash and cash equivalents at the end of the period 28,4 52,6 28,4
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Rate development
• Spot rates somewhat down from peak in Q4 due to seasonal influx of vessel availability
• Mid-term charter rates unchanged at reg. USD 140 – 150’
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Agenda 28/021. Highlights Q4
2. Company overview
3. Q4 Financials
4. Market update
5. Summary
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Market update
LNG shipping fundamentals are appealing
Gas is clean Gas is abundantly available Gas is cheap
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LNG demand to grow strongly
Source: IEA, BP, Fearnley
• Gas is expected to be the strongest growing source of energy going forward
• According to BP, gas supplied from LNG is expected to grow more than twice as fast as global gas production in percentage
terms, and faster than inter-regional pipeline trade
• LNG is expected to contribute with 25% of global gas supply growth 2010-30, compared to 19% for 1990-2010
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• January imports up 28% Y-O-Y to 8.15 million tonnes, new all time high
• 3 out of 54 Japanese nuclear reactors are running, and will likely be closed during 1st half 2012
• To restart, final approval is needed from the government and local communities based on input from the Nuclear Safety commission, the
International Atomic Agency and Japanese nuclear experts
Japanese import at all time high
Source: Fearnley
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China LNG imports increases
• January imports up 60% y-o-y, to 1.3m tonnes
• The Chinese government aims to increase the share of gas in total energy demand from
4% in 2010 to 8% in 2015 and 10% in 2020
Source: Fearnley
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Country Project name Main Partners FID Startup MPTA Max Vessels Req.
Angola Angola LNG Chevron,BP, Eni, Total, Sonangol Taken 2012 5,2 9
Australia Pluto LNG Woodside, Tokyo Gas, Kanseai Electric Taken 2012 4,8 4
Algeria Gassi Touil Sonatrach Taken 2013 4,7 5
Papua New Guinea PNG LNG ExxonMobil, OilSearch, Santos, NPCP Taken 2014 6,6 5
Australia Gladstone LNG Santos, Petronas, Total, KOGAS Taken 2015 7,8 7
Australia Gorgon LNG Chevron, Shell, Exxon, Mobile Taken 2015 5+5+5 12
Australia Queensland Curtis LNG BG, Queensland Gas Taken 2015 4,25+4,25 10
Australia Australia Pacific LNG Origin, ConocaoPhilips, SinoPec Taken 2016 433+4,3 8
Australia Ichtys Field NW Australia INPEX,Total Taken 2016 4,2+4,2 6
Australia Prelude LNG Shell Taken 2016 3,5 4
Indonesia Donggi-Sulawesi Pertimina, Medco, Mitsubishi 2012 2015 2 2
Papua New Guinea Liquid Niguini Interoil, Pacific LNG, Liquid Niguini, Flex 2012 2015 2 3
USA Sabine Pass Chenniere, JP Morgan 2012 2015 4,3+4,3+4,3+4,3 30
Australia Brownse LNG
Woodside, BP, BHP Billition, Chevron,
Shell 2012 2016 4+4 8
Australia Weatstone LNG Chevron, Shell 2012 2016 4,4+4,4 7
Canada Kitimat Apache, EOG, Encana 2012 2016 5+5 10
Indonesia Tangguh (expansion) BP Migas 2012 2016 3,8+3,8 6
USA Freeport Freeport LNG, Macquaire 2012 2016 4,4+4,4+4,4 18
Equatorial Guinea Tain 2 Sonagas Boble, Ophir 2012 2017 5 8
Russia Sthokman Gazprom, Statoil, Total 2012 2017 5+5+5 18
Russia Yamal LNG Novatek, Total, QP ? 2012 2017 5+5+5 18
Nigeria NLNG (7 train expansion) ExxonMobil, NNPC, Shell, Total, ENI 2013 2017 4,7 7
Total 150-200mtpa 205
• If all projects realized – 205 vessels required in order to meet incremental volume.
• If only 70% on stream – 143 vessels required
Source: Fearnley
LNG Projects growth 2011-2017
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Shale gas
U.S production
• U.S producers have started to reduce production du to low gas price
• Cheniere has signed off-take contracts totaling 16 Mtpa
• Construction is scheduled to start in 2012, pending FERC approval
Europe
• BP do not expect major unconventional production in Europe before 2020
• The decline in conventional supply implies a growing import requirement for Europe, up by more than
60%, from 26 Bcf/d in 2010 to 42 Bcf/d in 2030 ( equaling 122,6 Mtpa of LNG)
China
• Gas consumption expected to increase from 109 Bcm in 2010 to 400 bcm in 2020
• Gas production is expected to grow from 93 Bcm in 2010 to 251 Bcm in 2020 (of which shale gas
production is estimated to contribute 100 Bcm)
• LNG import estimated to increase from 9.3 Mtpa in 2010 (11% of total demand) to 59.2 Mtpa in 2020
(20% of total demand)
Source: BP, Fearnley
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World LNG Fleet by Year of Built
• Total orderbook LNG vessels ex FSRU – 69 vessels (including last Golar vessels), of which 30 are assumed committed and 39 open.
• Limited yard capacity until end 2014, options will most likely be utilized
• Orderbook expected to grow at the tail end of the period (2014-2015) annual capacity about 45 vessels/year
Source: Fearnley
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Agenda 28/021. Highlights Q4
2. Company overview
3. Q4 Financials
4. Market update
5. Summary
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Summary
Market • LNG demand: Expected to grow steadily
• Liquefaction capacity: Capacity is set to grow
- 60 – 70 Mtpa under construction
- 90 – 140 Mtpa additional FID in period 2012 to 2013
• Shipping: - Shortage of vessels expected next two years
- Limited orderbook until end 2014
- Trading distances is expected to continue to increase
- Firm market expected in 2012 and 2013
Awilco LNG • All vessels on contracts with proven track record
• Strong balance sheet with no debt on existing vessels, no need for financing of NB prior to delivery
• Awilco LNG well positioned to take advantage of strong market with 2 vessels available during 2nd half 2012
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A Pure Play LNG Transportation Provider
Experienced
management team
2nd gen. fleet of
3 LNG carriers
2 newbuildings
world class yard
Strong balance sheet
Solid ownersTier 1 customers
Opportunistic strategy
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Jon Skule Storheill
CEO
Mobile: +47-9134 4356
E-mail: [email protected]
Snorre Schie Krogstad
Chief Financial Officer
Mobile: +47-9085 8393
E-mail: [email protected]