j. lauritzen a/s investor update interim financial...
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J. Lauritzen A/S
Investor Update – Interim Financial Report 2014 Q2
August 2014
www.j-l.com | Oceans of know-how
AGENDA
• Financials - the first half of 2014
• Vessel values
• Business areas
• Refinancing 2015-2017
• CAPEX
• Outlook for 2014FY and summary
Further information included in Appendix
Please read the disclaimer placed as the
last slide in this presentation. Thank you.
2 2014 Q2 – Investor Update
First half year 2014 - EBITDA and result in line with expectations - Improvement primarily related to dry bulk activities
• Markets
• Dry Bulk sector going through difficult period – continuing into 2014 Q3
• Also challenging market conditions for smaller S/R gas carriers
• However, improving sentiments for the medium term
• Business areas
• LB: Slightly better dry cargo trading in 2014 H1
• LK: Stable/slightly negative in addition to a decline in operated fleet
• Delivery of remaining two shuttletankers expected to take place Mid-
August
• Financials
• EBITDA in line with expectations
• Net result satisfactory
• Refinancing
• Substantial refinancing completed early July 2014
• 2014FY outlook revision
• Dry bulk earnings downward adjusted for 2014 H2
JL on track to go black in 2014
3
Key messages
2014 Q2 – Investor Update
Q2 Q2 H1 H1 FY
USDm 2014 2013 2014 2013 2013
EBITDA (continuing operations) 49.0 4.2 58.7 0.1 8.9
-Lauritzen Bulkers 43.2 (2.5) 48.3 (13.0) (10.5)
-Lauritzen Kosan 7.8 8.4 14.1 17.2 28.1
-Other (2.0) (1.8) (3.8) (4.0) (8.7)
Sale of assets 0.0 (9.4) 5.6 (9.5) (7.6)
Depreciation (14.4) (16.7) (28.6) (33.5) (63.4)
Write down 0.0 (133.0) 0.0 (133.0) (133.0)
Operating Result (cont. operations) 34.6 (154.9) 35.7 (175.8) (195.1)
Joint ventures (0.6) (4.6) 0.1 (7.0) (10.7)
Finance net (10.1) (7.7) (20.7) (14.4) (30.7)
Result before tax 23.9 (167.2) 15.1 (197.3) (236.6)
Tax 0.0 (0.1) 0.1 (0.1) 0.1
Profit/(loss) from cont. operations 23.9 (167.3) 15.2 (197.4) (236.5)
Profit/(loss) from disc. operations 3.1 (69.2) 13.8 (64.6) (47.8)
Profit/(loss) for the period 27.1 (236.5) 29.0 (262.0) (284.3)
Minorities 0.0 0.0 0.0 0.3 0.3
Net Result 27.1 (236.6) 29.0 (262.3) (284.6)
EBITDA (discontinued operations) 4.2 12.1 16.2 25.4 48.0
-Lauritzen Tankers (1.9) 5.4 3.3 11.9 21.1
-Lauritzen Offshore 6.1 6.8 12.9 13.6 27.0
EBITDA (total) 53.2 16.3 74.8 25.5 57.0
2014 H1 EBITDA of USD 74.8m – in line with expectations
4
Income statement EBITDA (total) in USDm
• EBITDA (continuing operations) up by USD 58.6m • Lauritzen Bulkers (dry bulk): Better dry cargo trading, redelivery of
expensive T/C tonnage and revenue from sold claim
• Lauritzen Kosan (small LPG carriers): Challenging markets and
decline in active fleet
• Profit on sale of vessels up USD 15.1m to USD 5.6m
• Depreciations reduced by USD 4.9m to USD (28.6)m
• Finance net increased by USD (6.3)m to USD (20.7)m
• Currency exchange gain on JPY debt included in 2013 H1
• Net result for 2014 H1 a positive USD 29.0m
up from USD (262.3)m in 2013 H1
• 2013 H1 included loss from sale of assets and significant impairments
- EBITDA for 2014 H1 includes USD 30m in revenue from sale of claim etc.
- Net result for 2014 H1 totaled USD 29.0m
Comparing 2014 H1 to 2013 H1
2014 Q2 – Investor Update
(10.0)
0.0
10.0
20.0
30.0
40.0
50.0
60.0
Q1 Q2 Q3 Q4 Q1 Q2
2013 2014Continued operations Tank/shuttle tank (discont.)
Total assets amounted to USD 1,631m
Balance sheet
5
Key messages
• Fixed assets at USD 1,149m, down by USD 571m: • Sale of product tankers
• Reclassification of shuttletankers
• Solvency at 47.3% • Will increase further upon delivery of remaining two shuttletankers to
new owner
• ROIC of 6.9% • Adjusted for sale of claim ROIC was 2.8%
• NIBD/EBITDA at 4.0
based on EBITDA for continued and discontinued operations • NIBD/EBITDA at 4.3 for continued operation only
• Cash amounted to USD 192 (up from USD 154 at 2013YE): • Undrawn committed credit facilities of USD 30m brings cash and
unused credit facilities to a total of USD 222m at 2014 Q2
• Does not include DKK 100m overdraft facility
• CAPEX commitment relating to fully-owned newbuildings was USD
139m by 2014 Q2
• Off-balance commitments related to chartered fleet was USD 826m
(gross). Up USD 365m (gross). • Further details on slide 19
- Down USD 372m (19%) from 2013 Q2: Reflecting e.g. sale of assets
- Long-term financial strength improved: Solvency and cash increased due to deleveraging. LTV decreasing
2014 Q2 – Investor Update
2013 2014
USDm Act Act
Fixed assets 1.720 1.149
- Assets in operation 1.550 1.015
- Prepayments 45 29
- Invested in Joint Ventures 125 105
Current assets 283 482
- Cash 176 192
Total assets 2.003 1.631
JL share of equity 755 771
Minority share 1 0
Non current liabilities 1.082 559
Current liabilities 165 301
Solvency 37,7% 47,3%
ROE (65,3%) 7,7%
NIBD/EBITDA 19,1 4,0
Investments (vessels only) 26 39
Divestments (vessels only) 0 296
ROIC (26,1%) 6,9%
1st - 2nd Quarter
Vessel values almost unchanged, mainly reflecting fleet ageing; LTV down
6
- Vessel values (across all JL segments) stable: On average down 1.9% on December 2013 and up 3% on June 2013
- Dry bulk down 3.5% (on Dec. 2013) and up 7.4% (on June 2013); Gas carriers down 0.8% and down 2.2%, respectively
Average age in years and vessel values in USDm by end June 2014 – fully owned fleet excl. SHT
Debt, book values and market values are per end June 2014. Fleet count as per end June 2014.
Totals may differ due to rounding. Book values excl. dockings, etc.
Note: Supramax dry bulk vessels (”SM”): 2 vessels were sold but not delivered at end June 2014. Vessels were delivered in July 2014.
Above chart does not include Shuttletankers (“SHT”): 2 vessels. Book value USD 150m. Market value USD 157m. Debt USD 94m. Average
age 2.5 years
HS = Handysize
SM = Supramax
CZ = Capesize
SR= Semi-refrigerated
FP = Fully-pressurized
ETH = Ethylene
SHT = Shuttletankers
Average age
7.1 years
Average LTV
63.6% of
market values
379
49
234
36
110
175
200
33
128
43
63
126
321
56
199
65
123
168
4.8
3.0 3.5
17.3
7.5
6.0
0
2
4
6
8
10
12
14
16
18
20
-
50
100
150
200
250
300
350
400
HS SM CZ SR FP ETH
BULK GAS
Book Value Debt Market Value Vessel average age (RHS)
USDm Years
NIBD 57% of
market values
2014 Q2 – Investor Update
Lauritzen Bulkers - Top 5 operator in Handysize dry bulk with huge customer base - Young fleet (average age 4.4 years)
7
Handysize & Supramax (Small bulk) Cape size (Large bulk)
• Significant volume of transactions in the Handyzise segment
generates information and market knowledge in LB
• Extensive market knowledge enables LB to take positions
• Strategic ambition to employ same approach in Supramax
• Renewal of T/C-in fleet ongoing with focus on flexibility via options
• Tonnage reshuffling of owned Supramax-fleet
• 4 owned vessels hereof 2 on 12-
year time charter
• ”No cover – no capes”
• Strategic focus: Cash generation
Activity,
fleet &
coverage
Rationale &
strategy
Cover **
Han
dysize
Sup
ramax
Cap
esize
Total
New
bu
ildin
gs
Total 65 15 6 86 25
Owned 17 2 4 23 6
Part-owned 10 2 0 12 2
B/B in 0 0 0 0 0
T/C in *) 23 11 2 36 17
Joint charters 3 0 0 3 0
Pool, etc. 12 0 0 12 0
Fleet at end 2014 Q2*
Note: * Not including time-charters with a
duration of less than six months
Note: ** For the remainder of the year (at end July).
CoAs included in the cover with expected requirement
Activity (avg. no. of ships)
44%
47%
86%
38%
51%
92%
0% 25% 50% 75% 100%
Handysize
Supramax
Cape size
2014
2013
0
20
40
60
80
100
120
140
2010 2011 2012 2013 2014 E
Handysize Supramax
Large bulk Total
2014 Q2 – Investor Update
Dry Bulk: Q3 expectation revised down - recovery still expected in Q4
• Q2 weaker than expected
• Main reason: to many vessels in the Atlantic due
to lower acticity in the Pacific caused by the
Indonesian export ban
• Weak markets also caused vessel values to decrease
• As a consequence of the surprisingly bad market
expectations for Q3 rates have been lowered
• Recovery in Q4 still is expected as a combination of
seasonality, good outlook for the Northern grain
season and more trade in nickel ore from other
suppliers than Indonesia as China run down their
inventories
• Contracting of bulk carriers seems to be decreasing
following high volumes in 4Q 2013 and 1Q 2014
• Supply outlook for smaller segments still relatively
sound
2014 Q2 – Investor Update 8
- Handysize fleet growth close to zero
Cautious optimism for Q4
Source: J. Lauritzen A/S based on data from Clarkson Research Services
Spot Market Rates
Low fleet growth in Handysize
0%
20%
40%
60%
80%
100%
Handysize Supramax Capesize
Bulk carrier age profile and orderbook - August 2014
25 years or more 15-24 0-14 Orderbook
0
250
500
750
1000
1250
1500
1750
2000
2250
2500
0
5000
10000
15000
20000
Ind
ex
US
D/D
ay
Rates
Average of the 6 T/C Routes for the Baltic Handysize Index $/Day
Average of the 6 T/C Routes for Baltic Supramax Index $/Day
Baltic Exchange Dry Index Index
Lauritzen Kosan - Provider of ocean transport solutions of liquefied petrochemical gases and energy gases (LPG) - Strategic advantageous position based on in-house technical expertise and global presence
9
Semi-Refrigerated (S/R)
• Industrial shipping in small size LPG carriers (3-10,000 cbm) mainly based on repeating customers
• Contracts are typically renewed (renegotiated) annually
• Coverage decided on the basis of market outlook and market conditions
• Focus on operational efficiency, technical excellence and ability to provide service at lowest possible cost
• Growth ambition with focus on larger size gas carriers intact; However timing is key
Activity,
fleet &
coverage
Rationale &
strategy
Cover ** Fleet at end 2014 Q2*
Note: * Not including time-charters with a
duration of less than six months
Activity (avg. no. of ships)
Semi-refrigerated
Ethylen
e
Fully-p
ressurized
Total
New
bu
ildin
gs
Total 18 11 13 42 0
Owned 6 6 10 22 0
Part-owned 0 3 0 3 0
B/B in 6 0 0 6 0
T/C in *) 0 0 3 3 0
Pool, etc. 6 2 0 8 0
Ethylene Fully-pressurized (F/P)
0
5
10
15
20
25
30
35
40
45
50
0
2
4
6
8
10
12
14
16
18
20
2010 2011 2012 2013 2014 E
Semi-refrigerated Ethylene
Fully-pressurized Total (RHS)
74%
50%
44%
56%
45%
37%
0% 25% 50% 75% 100%
F/P
S/R
Ethylene
2014
2013
2014 Q2 – Investor Update
Note: ** For the remainder of the year (at end July).
CoAs included in the cover with expected requirement
74%
50%
44%
56%
45%
37%
0% 25% 50% 75% 100%
F/P
S/R
Ethylene
2014
2013
Total >>
Small Gas Carriers: Low volatility – expectations basically unchanged
• Demand outlook continues to look promising e.g.
driven by increasing export of LPG from US
• Solid demand outlook has caused contracting to
increase, primarily for > 10,000 cbm, in line with our
expectations
• Vessel values stable or slightly up
• The market balance is anticipated to improve during
the second half of the year. And we expect a slight
improvement in rates
2014 Q2 – Investor Update 10
- Slight improvement expected in 2H 2014
Solid Demand outlook
Sources: J. Lauritzen A/S based on data from Clarkson Research Services and Fearnley’s
5% fleet growth expected 2014
Rates expected to improve slightly
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Semi-Refrigerated Fully-pressurised
Small gas carriers age profile and order book 2013 YE
25 years or more 15-24 yeas 0-14 years Order book
0
100
200
300
400
500
600
700
800
jan-1
1
ma
r-11
ma
j-11
jul-11
se
p-1
1
nov-1
1
jan-1
2
ma
r-12
ma
j-12
jul-12
se
p-1
2
nov-1
2
jan-1
3
ma
r-13
ma
j-13
jul-13
se
p-1
3
nov-1
3
jan-1
4
ma
r-14
ma
j-14
jul-14
(F/P) 3.500 cbm S/R 3,200 cbm (S/R) 6.500 cbm (ETH) 10.000 cbm
Other business activities
11
- Investment in the Accommodation and Support Vessel segment via Axis Offshore Pte. Ltd.
Accommodation and Support Vessels
2014 Q2 – Investor Update
• Axis Offshore: J/V between HitechVision and JL
• Focus on developing business in ASV segment
• One unit in operation (Dan Swift) on T/C until end 2016-Q2
• Two new units for delivery:
• Axis Nova expected in 2015 H1
• Axis Vega expected in 2015 /2016
• No cover established, yet
• JL investment commitment (contingent liability) maximum USD 66m
• JL ownership share 34%. JL voting rights 50%
Other investments
Hafnia Tankers
• Lauritzen Tankers sold its fleet of
MR tankers to Hafnia Tankers in
2013 (delivery completed 2014 Q1)
• JL currently holds 5.6% of the
shares in Hafnia Tankers Ltd.
Dry bulk business segment
• Co-ownership in J/Vs controlling 10 Handysize vessels
and 2 Supramax vessels
• Co-ownership in a J/V controlling 2 orders on Handysize
vessels new buildings
Gas carriers
• Co-ownership in a J/V owning 3 ETH vessels
Debt overview: Significant refinancing completed early July 2014 - 77% of bank debt originally maturing in 2015-2017 refinanced
- Strategic focus to ensure ability to repay 2015-maturing bond without re-issuance of bonds or call for more equity
2014 Q2 – Investor Update 12
Outstanding debt and total commitment in USDm Repayment profile in USDm
Note: Charts shows actual data for existing facilities as per end-July 2014. Numbers shown are forecast and will change subsequently, e.g. in case of sale of a vessel, prepayment,
reduction or increase in use of revolving facilities, etc. Totals may differ due to rounding. Bond debt at hedged value less JL’s holding of own bonds.
26
57 52
36 36 30 28 24
14 7
45 63
8
76
87
0
20
40
60
80
100
120
140
160
180
200
2014 -H2
2015 2016 2017 2018 2019 2020 2021 2022 2023
Repayment
Bullit bank loans
Bullit bonds
Expiry of revolving credits (undrawn)
225 190
115 58 40 18
140
123
106
89 72
55 38 21
163
87
87
34
30
25
0
100
200
300
400
500
600
700
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Term loans
Term loans ECA backed
Bonds unsecured
Revolving credits (drawn)
Commitment incl. undrawn revolving credits
After prepayment of debt relating to shuttletankers After prepayment of debt relating to shuttletankers
CAPEX - 4+4 orders for Handysize and Supramax (dry bulk) vessels part of ongoing fleet renewal
- Supramax orders matched by sales of 4 fully-owned supramax vessels during 2014 (completed in July)
13
2014 2015 2016 2017 Total
CAPEX
Payments on newbuildings
Fully owned USD m 5 7 45 82 139
Part owned – JL share (dry bulk) * USD m - 2 1 2 5
Part owned – JL share (Axis Offshore) ** USD m - 33 25 - 58
Financing
Committed financing (fully owned) USD m - - - - -
Expected financing (fully owned) *** USD m - - 37 72 109
Deliveries
Fully owned new buildings
Handysize (dry bulk) # 2 2
Supramax (dry bulk) # 2 2 4
Part-owned new buildings
Handysize (dry bulk) # 2 2
Accomodation and Support Vessels (Axis Offshore) # 1 1 2
2014 Q2 – Investor Update
Note: *) Amounts shown are the equity commitment expected to be called from JL.
Note: **) Amounts shown are the commitment expected to be called from JL. Actual amount may differ and will e.g. depend also on amount of capital raised directly by Axis Offshore
Note: ***) On the basis of 65% of market value at delivery
JL is on track to go black in 2014
14 2014 Q2 – Investor Update
Amounts in USDm
2013
Annual Report
2014 Q1
Interim Report
2014 Q2
Interim Report
EBITDA
(continuing operations)
55m-75m 80m-100m 65m-80m
Writedowns,
Impairments, etc.
None None None
Net result (25)m-(5)m 15m-40m 5m-20m
Other comments Sale of claim
(STX Pan Ocean)
Dry bulk revised downwards
(particularly Q3)
Sensitivity:
+/- USD 6.7m, based on
+/- USD 1000/day in LB, and
+/- USD 500/day in LK,
respectively
- Strategic adjustments announced 12 months ago almost completed
- Road still bumpy: Markets not performing as expected
Earnings guidance 2014 FY *)
Note: *) Currency and interest rate fluctuations as well as effects from sale of assets may also impact the result
Financial strategy targets achieved
• Long-term financial strength secured and substantial refinancing completed
Outlook 2014 revised slightly down
• Dry bulk still going through difficult period in the near term but moving towards balance
• Slight improvement expected for small gas carriers but markets still subdued end of
2014
Contact details
Investor relations
Jacob Winthereik Financial Investor Relationship Manager, Group Treasury
E-mail: [email protected]
Phone: +45 3396 8384
Web: http://www.j-l.com
15 2014 Q2 – Investor Update
Press & Media
Jens Søndergaard Senior Vice President,
Strategic Planning & Executive Communications
E-mail: [email protected]
Phone: +45 3396 8401
Web: http://www.j-l.com
www.j-l.com | Oceans of know-how
Appendix
• Management
• Corporate bonds issued by J. Lauritzen A/S
• Charter commitments and charter obligations
• Ownership
• Lauritzen Fonden
• Glossary
• Disclaimer
16 2014 Q2 – Investor Update
Bent Østergaard, Chairman (Member of BoD since 2003)
President of Lauritzen Fonden & LF Investment Aps
Chairman of the BoD (selected): DFDS A/S, Kayxo A/S, NanoNord A/S,
Cantion A/S
Membership of BoD (selected): Royal Arctic Line A/S
Ingar Skaug, Deputy Chairman (Member of BoD since 1998)
Former CEO of Wilh. Wilhelmsen ASA
Selected board membership: DFDS A/S
Jesper T. Lok (Member of BoD since 2014)
President & CEO, DSB
Board member of Danish Crown
Niels T. Heering (Member of BoD since 2001)
Partner & chairman of the BoD in Gorrissen Federspiel (law firm)
Chairman of the BoD (selected): Jeudan A/S, NTR Holding A/S
Peter Poul Lauritzen Bay (Member of BoD since 2003)
Management Consultant at Accenture
Descendant of the founder of Lauritzen Group
Other board membership: None
Marianne Wiinholt (Member of BoD since 2011)
Executive Vice President & CFO, DONG Energy A/S
Other board membership: None
Supporting Committees:
Audit committee (members are marked with )
Nomination and Remuneration Committee (members are marked with )
Employee elected members of the Board of Directors:
Søren Berg, Ulrik Danstrøm and Jan Lystlund Sørensen
17
Executive Management Board of Directors
N
N A
A
A
N
Management and Board of Directors of J. Lauritzen A/S - Experienced, independent and professional team
Birgit Aagaard-Svendsen
Executive Vice President & CFO, J. Lauritzen A/S
External board memberships: DSEB (chairman), Otto
Mønsted A/S, The West of England Ship Owners
Mutual Insurance Association, Chairman of the
Committee on Corporate Governance in Denmark
JL’s CFO since 1998 (MoB 1992-1998 in JL-Fondet)
Jan Kastrup-Nielsen
President & CEO, J. Lauritzen A/S
External board membership: Danish Ship Owners
Association, Avance Gas Holding Ltd.
With JL from 1987-1993, 2000-today, executive
management since 2009, COO since 2011, CEO
since February 2013
2014 Q2 – Investor Update
N A
Corporate bonds issued by JL
18
*) On 19 Dec. 2013, JL announced that we had bought back NOK 261m
(subsequently reduced to NOK 259m) in the “10.5% JL 5 May 2015” bond
90
92
94
96
98
100
102
104
106
Jan-12 Jul-12 Jan-13 Jul-13 Jan-14
100
300
500
700
900
1,100
1,300
1,500
2010/2015 - spread (rhs)
2010/2015 - price (lhs) 400
450
500
550
600
650
700
750
800
850
900
90
92
94
96
98
100
102
104
106
108
Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14
2012/2017 - price
2012/2017 - spread (rhs)
JLA 01: NOK 700m JL 10.5% 2010/2015 JLA 02: NOK 500m JL FRN 2012/2017
Issuer: J. Lauritzen A/S
ISIN: NO 001 0572381
Type: Senior Unsecured Bond
Coupon p.a.: Fixed 10.5%
Issue date: 05 May 2010
Maturity date: 05 May 2015
Amount: NOK 700m *)
Interest payment: Annual
Listing: Oslo Stock Exchange
Source: Oslo Stock Exchange, Bloomberg
Issuer: J. Lauritzen A/S
ISIN: NO 001 0661846
Type: Senior Unsecured Bond
Coupon p.a.: Floating rate 8.25% + NIBOR 3 mths
Issue date: 24 October 2012
Maturity date: 24 October 2017
Amount: NOK 500m
Interest payment: Quarterly
Listing: Oslo Stock Exchange
2014 Q2 – Investor Update
Charter obligations
2014 Q2 – Investor Update 19
At the balance sheet date JL has the following operational lease obligations from time charter and bareboat contracts:
2014
USDm
committed
obligation
No. of vessels,
full year
equivalents
USDm
committed
obligation
No. of vessels,
full year
equivalents
USDm
committed
obligation
No. of vessels,
full year
equivalents
2nd half 2014 87.2 38.6 7.5 8.1 94.7 46.6
1 - 2 Year 142.2 31.5 12.0 6.0 154.2 37.5
2 - 3 Year 129.2 28.8 7.9 4.4 137.1 33.2
3 - 4 Year 108.4 25.2 4.0 2.3 112.4 27.5
4 - 5 Year 95.2 22.5 - - 95.2 22.5
> 5 Year 263.6 67.3 - - 263.6 67.3
Total 825.8 - 31.5 - 857.2 -
2013
2nd half 2013 88.6 33.3 5.8 5.7 94.3 39.0
1 - 2 Year 115.0 22.1 7.1 3.5 122.0 25.5
2 - 3 Year 67.8 13.8 2.7 1.0 70.5 14.8
3 - 4 Year 44.6 9.7 0.2 0.1 44.8 9.8
4 - 5 Year 26.9 7.1 - - 26.9 7.1
> 5 Year 117.8 40.5 - - 117.8 40.5
Total 460.7 - 15.7 - 476.4 -
At end of June 2014 JL had purchase option on 22 bulk carriers (End of June 2013: 9 bulk carriers).
Bulkers Kosan Total continuing business
J. Lauritzen A/S is 100% owned by the Lauritzen Foundation (Lauritzen Fonden) - Lauritzen Fonden: An experienced owner, focused on shipping secures long-term sustainability
20
LF Investment Aps (formerly Vesterhavet A/S)
100%
DFDS A/S 42.8%
J. Lauritzen A/S 100%
(Formerly JL-Fondet)
Lauritzen Bulkers Lauritzen Kosan
The Lauritzen Foundation is a commercial foundation and as such a self-governing institution in Danish Law
The Lauritzen Foundation is regulated by the Danish Act on Commercial Foundations
The Foundation is under supervision by the Danish Ministry of Justice and the Danish Ministry of Business and Growth
2014 Q2 – Investor Update
Lauritzen Fonden was established in 1945 by the brothers Ivar and Knud Lauritzen and their sister Anna Lønbjerg-Holm. It was established in connection with the 50 years anniversary of Dampskibsselskabet “Vesterhavet”. Vesterhavet was founded by their father Ditlev Lauritzen in 1895.
Chairman Board of Directors; Jens Ditlev Lauritzen (great grandchild of the founder of J. Lauritzen)
The objectives of the Foundation are (e.g.):
To work for the prestige of Denmark by promoting and developing Danish shipping, especially international shipping, and Danish enterprises in general
To support studies and projects of a technical, commercial or other nature in shipping, trade and industry, agriculture and other sectors
To support the education/training of young people in Denmark and abroad
To work towards vessels, workshops and other workplaces, offices and housing operated by the companies, especially those associated with the Foundation, being healthy, bright and well-maintained and that they should be organised so as best to promote job satisfaction, and to provide support for the personnel and institutions working for such purposes, especially in the shipping sector
To provide support for institutions, associations and people who, all in all, look after the interests of the shipping sector and people employed therein, especially such institutions and associations set up by those in the Lauritzen Group or its companies, or have supported, have an interest in or been associated with, and possibly seek to associate them to other humanitarian institutions that are not self-supporting, and also to set up and operate humanitarian institutions that operate in line with the above
To provide support for institutions, associations and people who are working to encourage awareness and esteem of Danish cultural activities, especially including corporate culture, education/training, self-improvement and character training of the young, studies into disease prevention, especially prophylaxis
To provide support for institutions, associations and people who are working to promote Nordic and international relations, also of a purely humanitarian nature
To provide support for institutions, companies, associations and people whose aims and work the Board feels it is proper to support
To provide support for people who have done service in one of the Foundation’s or the Lauritzen Group companies and to such people’s successors
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2014 Q2 – Investor Update
Glossary
Aframax: Crude oil tanker or product tanker too large to pass through the Panama Canal and below 120,000 dwt.
Bulk vessel: Vessels transporting large cargo quantities, e.g. coal, iron ore, steel, grain, gravel, oil, etc.
Bunker: Fuel for vessels.
Capesize: Dry bulk carrier of more than approximately 80,000 dwt; too large to pass through the Panama Canal.
Cbm: Cubic meter.
Clean products: Refers to light, refined oil products such as jet fuel, gasoline, diesel oil and naphtha.
CoA: Contract of Affreightment. Contract between shipping company and charterer concerning the freight of a predetermined volume of goods within a given period of time and/or at given intervals.
Coating: The internal coatings applied to the tanks of a product or chemical tanker. Coated tanks enable the ship to transport corrosive refined oil products or chemicals and it facilitates extensive cleaning of the tanks, which may be required in the transportation of certain cargoes.
Dirty products: Heavy oils such as crude oil or refined oil products such as fuel oil or bunker oil.
DP: Dynamic Positioning. Special equipment on board that in conjunction with bow thrusters and main propellers enable the ship to position itself in a fixed position in relation to the seabed.
Dwt: Dead Weight Tons. International unit of measurement that indicates the loading capabilities in metric tonnes of the particular vessel, including the weight of crew, passengers, stores, bunkers etc.
F(P)SO: Floating (Production) Storage Offloading Unit. Crude oil tanker used as substitute for a conventional oil platform at oil fields that are either too deep in the ground or too small to justify the use of a conventional oil platform. If the ship is an FPSO the ship has oil (or gas) processing capabilities on board.
Handy, tank: Crude oil tanker, product tanker or chemical tanker of between 10,000 and 25,000 dwt
Supramax (incl. Handymax), dry cargo: Dry bulk carrier of between approximately 40,000 and 65,000 dwt.
Handysize, dry cargo: Dry bulk carrier of between approximately 10,000 and 40,000 dwt.
IMO: International Maritime Organization A maritime organization under the UN, www.imo.org .
LPG vessels: Liquefied Petroleum Gas. Vessels used to transport ammonia and liquid gases (ethane, ethylene, propane, propylene, butane, butylenes, isobutene and isobutylene).The gases are transported under pressure and/or refrigerated.
LR1, product tanker: Long Range 1. Product tanker with the maximum dimensions for passing through the Panama Canal (width of 32.21 meters and length of 289.5 meters) of approximately 50,000—80,000 dwt.
LR2, product tanker: Long Range 2. Product tanker too large to pass through the Panama Canal of approximately 80,000 dwt.
Medium Range, tanker (MR): Product tanker of between 25,000 and 50,000 dwt.
Nautical Mile: Distance unit measure of 1,852 meters.
Offshore vessel: Vessel serving the offshore oil industry.
OPEC: Organization of Petroleum Exporting Countries.
Panamax, tanker: Crude oil tanker or product tanker with the maximum dimensions for passing through the Panama Canal (width of 32.21 metres and length of 289.5 metres) of approximately 50,000—80,000 dwt.
Panamax, dry cargo: Dry bulk vessel with the maximum dimensions for passing through the Panama Canal (width of 32.21 metres and length of 289.5 metres) of approximately 60,000—80,000 dwt.
Petrochemical gases: Industrial processed gases such as ethylene, propylene, butadiene and VCM.
Product tanker: Tanker vessel with coated tanks used to transport refined oil products.
Suezmax: Crude oil tanker with the maximum dimensions for passing through the Suez Canal (approximately 120,000—200,000 dwt.).
Time Charter (TC): Under time charters, vessels are chartered to customers for fixed periods of time at rates that are generally fixed. The charterer pays all voyage costs. The owner is responsible for payment of all vessel operating expenses (manning, maintenance, repair, docking) and capital costs of the vessel.
Time Charter Equivalent (TCE): Gross freight income less voyage-related costs (bunkers, harbor fees, etc.)
Ton-nautical mile: Unit of measurement indicating the volume of cargo and how far it has been transported.
VLCC: Very Large Crude Carrier. Crude oil tanker of between approximately 200,000 and 320,000 dwt.
VLGC: Very Large Gas Carrier. LPG ship with capacity above 60,000 cbm.
22 2014 Q2 – Investor Update
Disclaimer
• This presentation contains forward-looking statements concerning J. Lauritzen A/S (“J. Lauritzen”, “JL” or the “Group”) and its financial condition, results of
operations and business. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking
statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown
risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements.
• Forward-looking statements include, among other things, statements concerning J. Lauritzen’s potential exposure to market risks and statements expressing
management’s expectations, beliefs, estimates, forecasts, projections and assumptions. There are numerous factors that could affect J. Lauritzen A/S’ future
operations and could cause J. Lauritzen A/S’ results to differ materially from those expressed in the forward-looking statements included in this presentation.
• All forward-looking statements contained in this presentation are expressly qualified by the cautionary statements contained or referenced to in this statement.
Undue reliance should not be placed on forward-looking statements.
• Each forward-looking statement speaks only as of the date of this presentation. J. Lauritzen does not undertake any obligation to publicly update or revise
any forward-looking statement as a result of new information or future events other than required by applicable law. In light of these risks, results could differ
materially from those stated, implied or inferred from the forward-looking statements contained in this presentation.
• Some of the statistical and graphical information contained in the presentation is supplied from the Clarkson Research Services Limited (“CRSL”) database
and other sources. CRSL has advised that (i) some information in CRSL’s database is derived from estimates or subjective judgments, (ii) the information in
the databases of other maritime data collection agencies may differ from the information in CRSL’s database, (iii) whilst CRSL has taken reasonable care in
the compilation of the statistical and graphical information and believes it to be accurate and correct, data compilation is subject to limited audit and validation
procedures and may accordingly contain errors, (iv) CRSL, its agents, officers and employees cannot accept liability for any loss suffered in consequence of
reliance on such information or in any other manner, and (v) the provision of such information does not obviate any need to make appropriate further
enquiries. Any use of such data and graphical information appear with reference to Clarkson Research Services Limited
• While the information in the presentation is believed to be accurate, no representation or warranty, express or implied, is or will be made in relation to the
accuracy or completeness of this presentation or any other written or oral information transmitted or made available to any person or its advisors in connection
with any investigation of the Group and no responsibility or liability is or will be accepted by the Group or any of their respective affiliates and representatives.
In particular, no representation or warranty, express or implied, is or will be given as to the achievement or reasonableness of any statements, estimates and
projections with respect to the anticipated future performance of the Group and the market for the Group’s products and services.
23 2014 Q2 – Investor Update