Results Briefing. 15 ~ 17 May 2007

Transcription

1 Results Briefing 1Q Q & 3 Months ended 31 Mar ~ 17 May 2007

2 Content Key highlights Financial Corporate Financial results Industry overview Q&A Appendix 2 2

3 Key Highlights for the Period

4 Key Highlights for 1Q FY07 Financial Revenue for 1Q 07 hit US$1,008mil. Net Profit for 1Q 07 jumped to US$60mil. (131.7%), from US$26mil. in 1Q 06 FFA valuation loss of US$23mil. incurred in 1Q Corporate Four PCTCs and Three MR tankers were ordered in 1Q 07 Two Handymax bulkers were ordered in April

5 Key P&L Highlights (US$ mil.) 1Q 07 1Q 06 Diff. Change Sales 1, % Gross profit % Operating profit % Adjusted operating profit % FFA valuation gain (loss) (23) 2-25 N/A EBITDA % Adjusted EBITDA % Net income % EPS (US cent per share) Adjusted for unrealized FFA loss 5 5

6 (US$ mil.) 31 Mar Dec 06 Diff. Change Assets 1,665 1, % Cash & cash equivalents % Vessels % Investments in Korea Express % Liabilities % Debt % (Net debt) (228) (262) % Equity % Debt/Equity 53.6% 50.9% 1 Includes short-term financial assets and AFS of US$22 million 2 Includes construction in progress of US$105 million 3 31 Dec 06: KRW93,700 ; 30 Mar 07: KRW80,

7 Cash and Cash Equivalents - Opening Net cash generated from operating activities Cash generated from operations Interest paid Income tax paid Net cash used in investing activities Purchase of vessels, property and equipment Decrease in short-term finance instruments Other Net cash provided by financing activities Proceeds of borrowing Repayment of borrowing Net increase/(decrease) Cash and Cash Equivalents - Ending 1Q (5) (3) (65) (79) 15 (1) (7) (US$ mil.) 1Q (4) - (22) (58) (55)

8 Financial Results and Outlook

9 Sales Sales Sales by Business Segment US$'m 1,200 1, % 1,008 Bulker: 89% 40% 1Q 07 6% 3% 2% (US$ mil.) Large Bulker: 403 Container: 62 Tanker: 34 Car Carrier: Q06 Owned 1Q07 Chartered-in Breakbulker: % 29% Tramper: 295 Sales increased 55.7% Year on Year from Q Sales from dry bulk increased due to the raise in freight rates Tanker sales increased to US$34M, by US$12M or 55% from 1Q

10 Gross Profit Margin 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% 4,669 4,572 4,169 3, % 3, % 2,912 2,413 2,440 2, % 35.2% 27.7% 28.6% 25.1% 26.4% 13.4% 14.2% 13.8% 22.1% 12.8% 11.0% 8.8% 6.0% 7.6% 5.6% 8.6% 10.6% 6.0% 1.2% 4.8% 7.5% 6.7% 2.1% 2.9% 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q Average BDI of each Q Owned Margins Chartered-in Margins Overall Margins BDI Gross Profit Margin Average BDI Owned (%) 1Q 06 2, Q 06 4, Q 07 4, Improving gross profit margin in overall trend - Increase in freight rates - Increase in tonnage Chartered (%) Total (%)

11 FFA (Forward Freight Agreement) Valuation loss of US$23M on FFA was incurred for 1Q However, the valuation loss will only be realized when the FFAs mature, and a corresponding profit is also expected from the physical transaction. Estimated corresponding physical profits* (US$ m) ~ Total Physical market 20 5 (2) 23 * Assuming the BDI will maintain current level 11 11

12 Vessel Revenue Days (for 2 nd half of 2007) (Vessel revenue days) (as of 31 March 2007) 12,000 10,877 18,797 20,000 18,000 10,000 8,000 5,440 (50%) 7,775 (41%) 16,000 14,000 12,000 6,000 5,792 10,000 1,798 (31%) 8,000 4,000 2,000 5,437 (50%) 3,994 (69%) 2, ,591 (12%) (25%) (75%) 11,022 (59%) 6,000 4,000 2,000 0 Handy('Max) Panamax Cape Total Covered Open 0 The vessel revenue days represent the vessel operating capacity for our dry bulk fleet as of the end of 1Q

13 KRX Listing

14 Rationale for Capital Increase We have a very positive view on the dry bulk shipping industry in terms of the long-term perspective. We think an active investment in vessels is needed in order to follow up the market. We can strengthen the financial structure. We plan to raise the fund for the investment by the capital increase without increasing the debt ratio

15 Why KRX? To expand our investor base. To take advantage of bullish KRX market and the reputation as nation s leading dry bulk shipping company to grab a chance for better valuation. To satisfy and absorb the excessive demand of both domestic and overseas investors on STX group

16 Vessel Investment Plan for 2007 (order base) (In millions of US$) Type 2007E (Full year) Q 2006 Bulker 336 (8) Note 1) 24 (1) PCTC 300 (4) 300(4) - Tanker 135 (3) 135(3) 135 (3) Container 25 (1) - - LNG (1) Total 796 (16) 435(7) 374 (5) ( ) : No. of vessels Note 1) Additional 2 Handymax bulkers were order in April

17 Industry Overview

18 2007 Dry Bulk Market Overview Overview BDI brought up to the higher level China s robust demand in raw materials boosted the market trend 01 Jan Average BDI 1, Sep Average BDI 3, Apr Demand growth remain strong Expectations Lack of capacities at shipyards will limit new deliveries BDI will average 5,861 in 2007, 6,019 in 2008 and 5,989 in 2009 Source: <Shipping Industry Overview>, Merrill Lynch, May 2007 BDI expected to be stabilized at above 5,000 based on supply/demand fundamentals 18 18

19 Australian Port Congestions Australian Port Congestions 25 7,500 7,000 Vessels awaiting in Australian Ports Vessels awaiting at New Castle (Eastern Port) 20 6,500 Days ,000 5,500 5,000 4,500 BCI 80~85 Capesize & 80~85 Panamax 72 (Regardless of vessel sizes) 4, ,500 3,000 Source: SSY 0 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 2,500 Western ports Eastern ports BCI About 80 out of 720 Capesize vessels are kept in Australian ports as of the end of April

20 Key Dry Bulk Demand Indicators Chinese Iron Ore Import Increase: Increasing capesize demand Chinese Iron Ore Import (mil tonne) 2007E (mil tonne) Q06 1Q (E) Iron Ore Increased by 23.8% Q Source: H.Clarksons Imports Diff. 2006/07 78 mil tonne ( ) Equivalent to 66 Capesize (mil tonne) Net increase of Cape 2007 (Delivery-Scrapping) 8.5 mil dwt ( ) Equivalent to 50 Capesize H.Clarkson 20 20

21 Dry Bulk Demand Indicators World Steel Product Demand ,132 1,179 1, Mil. metric tons of steel China EU (9.0) (11.2) (13.0) (1.5) (10.0) (1.9) 200 NAFTA (11.1) (-3.1) (4.3) Europe CIS NAFTA Central&South America Africa Middle East Asia(exclude China) China World 1,132.2 (8.5) 1,178.6 (5.9) 1,250.5 (6.1) ( ) : % of increase (decrease) over the previous year Source: Steel News International Iron and Steel Institute ( IISI ) 21 21

22 Questions & Answers

23 Thank You