Scorpio Bulkers Inc. Q Earnings Supplementary Presentation April 23, 2018

Transcription

1 1 Scorpio Bulkers Inc. Q Earnings Supplementary Presentation April 23, 2018

2 Safe Harbor Statement This document may contain forward-looking statements that reflects management s expectations for the future. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words "believe," "anticipate," "intend," "estimate," "forecast," "project," "plan," "potential," "may," "should," "expect," "pending" and similar expressions identify forward-looking statements. The forward-looking statements in this document are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections. In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the failure of counterparties to fully perform their contracts with us, the strength of world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for dry bulk vessel capacity, changes in our operating expenses, including bunker prices, drydocking and insurance costs, the market for our vessels, availability of financing and refinancing, charter counterparty performance, ability to obtain financing and comply with covenants in such financing arrangements, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, vessels breakdowns and instances of off-hires and other factors. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties. 2

3 Corporate and Financial Highlights Q1-18 Results TCE GAAP Net Loss of $5.8 million / Loss per Share of (.08) EBITDA of $20.4 million and continued positive cash flow from operations Ultramax TCE of $9,757/day in Q Ultramax TCE of approximately $11,925/day booked to date in Q (for 48% of the days) Kamsarmax TCE of $12,881/day in Q Kamsarmax TCE of approximately $13,250/day booked to date in Q (for 56% of the days) Liquidity Liquidity position as of April 20, 2018 is $55.0 million in cash Debt Agreed $12.8 million loan facility for Kamsarmax bulk carrier delivering Q Agreed $19.0 million lease financing in Japan for Ultramax bulk carrier (SBI Tango) Fleet Status 1 Kamsarmax bulk carrier remaining to be delivered in Q Stock Buyback Purchased 1.2 million common shares at an average price of $7.39 per share Dividend The Company s Board of Directors declared a dividend of.02 per share for Q

4 Strengthening Market for Our Vessels The increase in reported TCE earnings over the last 2 years has defied traditional seasonality, and in the face of record newbuild deliveries, shows the underlying strength of the market and supports the continuation of the market recovery $14,000 $12,000 February 10, 2016 BDI hits 40 year low $12,605 $12,881 $11,925 $13,250 $10,886 $10,000 $8,000 $7,083 $7,238$7,401 $9,164 $9,273 $9,211 $8,949 $8,230 $8,360 $9,757 $6,349 $6,000 $5,335$5,263 $4,000 $3,462$3,331 $2,000 Q2-18* Ultramax Kamsarmax * Projections based on 48% and 56% of the days for the Ultramax fleet and Kamsarmax fleet, respectively as of April 18,

5 Financial Performance Revenue EBITDA $60 $50 $40 $30 $20 $10 $10.2 $17.4 $23.9 $26.8 $34.7 $37.7 $38.6 $51.1 $54.3 $30 $20 $10 -$10 -$20 -$17.0 -$5.8 -$1.3.9 $7.3 $10.8 $12.4 $22.9 $20.4 -$30 Operating Cash Flow EBIT $25 $15 $5 -$5 -$15 -$25 -$35 $20.9 $11.1 $2.5 $5.3 -$4.5 -$2.1 -$1.7 -$18.1 -$27.5 $10 $5 -$5 -$10 -$15 -$20 -$25 -$30 -$35 $6.0 $2.9 -$6.2 -$4.1 -$9.9 -$16.2 -$14.1 -$19.2 -$28.8 Figures in $USD millions. 5

6 Overview of New Financings $12.75m Credit Facility $12.75 million credit facility financing Kamsarmax bulk carrier delivering Q ~5 year term maturing June 2023 with a 15 year to zero repayment profile Pricing of L+2.40% SALT covenants (excl interest cover) + no debt service reserve accounts $19m Lease Financing $19 million lease finance of SBI Tango with Japanese shipowner and Japanese bank ~80% of vessel value 5 year lease tenor Bareboat Hire rate of $5,400 per day (equates to L+1.73% at the then prevailing swap rates) Purchase options starting at end of year 3 Minimum Tangible Net Worth covenant only On balance sheet and considered as debt for accounting purposes 6

7 Company Highlights Youngest ECO dry bulk fleet High specification best-in-class fleet of customer preferred Ultramax and Kamsarmax type vessels built at top tier yards with an average age of 2.0 years versus worldwide fleet average of 8 years Industry leading balance sheet Low financial leverage secured by most modern assets Exposure to rising spot market Vessels trade in the spot market in the Scorpio pools to ensure maximum exposure to rising freight rates Compliant with future regulatory requirements Fuel efficient 100% Eco fleet suitable for 2020 low sulfur fuel regulation and all vessels already fitted with Ballast Water Treatment Systems so no need for costly installation Favorable supply dynamics Historically low orderbook as a % of fleet combined with limited newbuilding orders & continued scrapping of older tonnage Positive demand outlook Dry bulk seaborne demand expected to grow 2.8% in