Höegh LNG The floating LNG services provider. 1Q 2015 Presentation of financial results 21 May 2015

Transcription

1 Höegh LNG The floating LNG services provider 1Q 2015 Presentation of financial results 21 May 2015

2 Forward looking statements This presentation contains forward-looking statements which reflects management s current expectations, estimates and projections about its operations. All statements, other than statements of historical facts, that address activities and events that will, should, could or may occur in the future are forward-looking statements. Words such as may, could, should, would, expect, plan, anticipate, intend, forecast, believe, estimate, predict, propose, potential, continue or the negative of these terms and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. Unless legally required, Höegh LNG undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: changes in LNG transportation and regasification market trends; changes in the supply and demand for LNG; changes in trading patterns; changes in applicable maintenance and regulatory standards; political events affecting production and consumption of LNG and Höegh LNG s ability to operate and control its vessels; change in the financial stability of clients of the Company; Höegh LNG s ability to win upcoming tenders and securing employment for the FSRUs on order; changes in Höegh LNG s ability to convert LNG carriers to FSRUs including the cost and time of completing such conversions; changes in Höegh LNG s ability to complete and deliver projects awarded; increases in the Company s cost base; changes in the availability of vessels to purchase; failure by yards to comply with delivery schedules; changes to vessels useful lives; changes in the ability of Höegh LNG to obtain additional financing, in particular, currently, in connection with the turmoil in financial markets; the success in achieving commercial success for the projects being developed by the Company; changes in applicable regulations and laws; and unpredictable or unknown factors herein also could have material adverse effects on forward-looking statements. 2

3 Höegh LNG Holdings; Agenda for presentation of 1Q 2015 results Sveinung J.S. Støhle President & CEO Highlights/Markets/Summary Steffen Føreid CFO Financials Dedededw Additional information 3

4 First quarter 2015 highlights: Five FSRUs in operation, planning for further expansion Total income USD 46.9 million and EBITDA of USD 16.5 million Loss before tax USD 1.9 million First quarterly dividend payment of USD 0.10 per share Höegh Gallant successfully commenced commercial operations in Egypt Significant progress on Port Meridian in the UK where the Company has an exclusive right to supply one FSRU and two LNG carriers Existing fleet operated according to contract and without incidents 4

5 Höegh LNG s FSRU projects are strategically important to our customers Unit Type Built Charterer HMLP dropdown candidate? Höegh LNG Holdings Ltd Libra LNGC 1979 Gas Natural No Arctic Princess LNGC 2006 Statoil Maybe Arctic Lady LNGC 2006 Total Maybe Independence FSRU 2014 Klaipedos Nafta Yes Höegh Gallant FSRU 2014 Egas Yes Höegh Grace FSRU Q SPEC Yes FSRU#7 / 2552 FSRU 1Q 2017 Yes Höegh LNG Partners LP GDF Suez Neptune FSRU 2009 GDF Suez GDF Suez Cape Ann FSRU 2010 GDF Suez PGN FSRU Lampung FSRU 2014 PGN Contracted Extension option Under construction Spot market HLNG average remaining contract length = 10 years HMLP average remaining contract length = 17 years 5

6 EGAS Project / Egypt Counterparty Egyptian Natural Gas Holding Company ( EGAS ) Location: Ain Sukhna port Red Sea Strategic rationale Cover gas deficit Contract length 5 years due to Egyptian procurement rules FSRU: Höegh Gallant Project start-up In operation Annual EBITDA Approximately USD 40 million 6

7 SPEC Project / Colombia Counterparty Sociedad Portuaria El Cayao S.A. E.S.P. ( SPEC ) Location: Cartagena - Atlantic coast Strategic rationale Meet increased demand for natural gas and back-up during El Nino Contract length 20 years (Break options at year 5,10 and 15) FSRU: Höegh Grace Project start-up Mid-2016 Annual EBITDA USD million depending on contract length 7

8 Port Meridian progress creates additional upside for Höegh LNG; 1 FSRU and 2 LNGCs Developed and permitted by Höegh LNG Location: offshore Barrow, Western UK, connected via pipe to UK gas grid Sold to West Face Capital (WFC) in 2012 Exclusive rights to provide FSRU and two LNGCs terms in line with market WFC has option to take up to 49% ownership Gas sales agreement between WFC and E.On for 20 years Planned start-up

9 MUSD Höegh LNG s FSRU strategy is continued strong growth Capital commitments 3500 First FSRU expansion Second FSRU expansion 3000 # #11 # #5+6 #7 #8 # # #1+2 0 Pre-IPO fleet however, the Company may increase the pace of its ordering 9 *

10 The LNG market keeps growing with 6% CAGR New importers will take an significant share of incremental supply Demand from small and new importers, represented by Others, is expected to triple over the next 10 years; from 33 to 105 Mtons/Y 10

11 and U.S. LNG exports starting in 2015 will make large volumes of LNG available in the market.. MTPA 18% of today s LNG production capacity Sabine Pass Freeport Cameron Corpus Christi U.S. export introduces a new pricing element to the LNG market; the HH index allows buyers to diversify their commodity price exposure Volumes are sold FOB buyers have full flexibility on destination U.S. is the world s largest and most liquid natural gas market with huge reserves; hundreds of years with current production long term security of supply 11

12 that can cover the additional demand from new markets served by FSRUs. FSRUs are normally used at locations where no land based LNG infrastructure nor central gas grid exists, i.e. the country is not already an importer Most FSRU projects are developed to meet medium size demand 2-6 Mtons/Y, including swings in demand caused by seasonality 12

13 Around 30 FSRU projects in the pipeline and growing FSRU operation FSRU operating as LNGC Firm FSRU project HLNG s FSRU focus for new projects Owner FSRUs (operation and construction) Business model Höegh LNG 5+2 Order before contract award - long term contracts Golar LNG 6+1 Order before contract award - no more FSRUs? Excelerate 9+0 Order before contract award? - short term contracts MOL 0+1 Order after contract award BW Gas 0+2 Order before contract award Exmar/PR 0+1* Order for specific project? 13 *Barge FSRU

14 Höegh LNG s FLNG focus; North America Höegh LNG s FLNG focus FLNGs under construction by competitors and oil majors Delfin LNG Why the North American focus: 1) Unlimited reserves of gas 2) Pipeline specification gas 3) Stable and known regulatory environment Independent FLNG operators Owner Units under construction Business model Höegh LNG 0 Barge FLNG, order after contract award Pacific Rubiales/Exmar 2 (1 on contract to PR) Barge FLNG, order on speculation? Golar 3 (1 MOU, no firm contracts) Conversion of old LNGCs, order on speculation 14

15 Summary Strong improvement in operating results; EBITDA increased with approximately USD 10 million from previous quarter Five FSRUs in operation generating stable and predictable cash-flow FSRU market keeps growing and latest pricing developments have given further push on demand.. And LNG exports from the US will bring increased volumes and dynamism to the LNG market Höegh LNG considering to increase its expansion pace for its FSRU fleet FLNG projects gaining momentum due to shorter construction time, lower capex and lower capacity 15

16 Höegh LNG Holdings; Agenda for presentation of 1Q 2015 results Sveinung J.S. Støhle President & CEO Highlights/Markets/Summary Steffen Føreid CFO Financials Dedededw Additional information 16

17 Consolidated Income Statement Total income EBITDA Net profit after tax USDm USDm USDm 0 (10) (5) (9) (2) (20) (30) (40) (16) 10-0 (5) (2) (0) (4) (50) (60) (70) (59) 17

18 Cash flow statement USD million 1Q2015 4Q2014 3Q2014 2Q2014 1Q2014 Net profit or (loss) before tax (2) (59) (16) (16) (4) Adjustments of non-cash P&L items (3) Dividend received from joint ventures Proceeds from sale of mooring Net changes in working capital, other 1 2 (1) (5) 6 Net cash flow from operating activities (7) 79 (1) Net (investments) proceeds in marketable securities (145) - - Investments newbuildings under construction and vessels (13) (231) (9) (369) (52) Investments in intangibles and equipment - (1) (0) (1) (0) Proceeds of repayment on shareholders loans Net cash flow from/(used in) investing activities 6 (188) (153) (367) (50) Net proceeds form equity issuance Proceeds from borrowings Repayment of borrowings (12) (23) (36) - (30) Dividend paid to non-controllling interest (MLP) (4) (2) Dividend paid to shareholders of the parent (7) Interest paid (11) (9) (7) (2) (2) Increase in restricted cash - (37) Other financing activities - (1) (1) (5) (8) Net cash flow from/(used in) financing activities (6) TOTAL CASH FLOW 14 (60)

19 USD million USD million Financial position Assets Equity ratio and NIBD % % 40% 50% 42% 41% 80% 60% 40% 20% 0% % -40% -60% -80% - Q1-14 Q2-14 Q3-14 Q4-14 Q Q1-14 Q2-14 Q3-14 Q4-14 Q % NIBD Equity ratio Other assets Current cash and marketable securities Vessels, newbuildings and installations under construction 19

20 Funding strategy USDm Funding raised USD 1.6 billion 1200 Capitalization 1Q2015 (USDm) (1) Bank debt Bond 400 Equity Equity Bond Bank 86 FSRU Funding strategy future growth MLP proceeds Unsecured debt Secured debt FLNG New equity Project finance LNGC Funded by HMLP Project finance 20 (1) Excluding Joint Venture bank debt

21 Financial summary first quarter 2015 Improved operating performance Strong balance sheet with additional debt capacity A dial-in Q&A session will be held at 3pm Oslo time / 9am EST time See for dial-in details 21

22 Höegh LNG Holdings; Agenda for presentation of 1Q 2015 results Sveinung J.S. Støhle President & CEO Highlights/Markets/Summary Steffen Føreid CFO Financials Dedededw Additional information 22

23 Income Statement USD million 1Q2015 4Q2014 3Q2014 2Q2014 1Q2014 Freight revenues 42,8 26,2 29,3 17,2 17,2 Voyage expenses (0,5) (2,4) (3,9) - - Construction contract revenue - 8,1 6,1 10,0 28,2 Management and other income 2,0 2,4 (0,4) 2,7 3,6 Share of results from investments in joint ventures 2,6 2,7 2,6 2,5 2,2 TOTAL INCOME 46,9 36,9 33,8 32,3 51,3 Charterhire expenses (8,7) (8,9) (8,9) (8,8) (8,7) Construction contract expenses - 1,1 (6,6) (6,8) (24,0) Operating expenses (9,5) (10,3) (8,5) (6,1) (6,9) Project administrative expenses (3,4) (4,2) (3,8) (4,8) (3,2) Group administrative expenses (5,1) (3,8) (5,1) (3,1) (4,7) Business development expenses (3,7) (5,3) (4,7) (3,1) (4,8) EBITDA 16,5 5,6 (3,9) (0,3) (1,0) Depreciation (8,4) (7,8) (6,2) (4,2) (2,9) Impairment - (44,8) EBIT 8,1 (47,1) (10,1) (4,5) (3,9) Interest expenses (9,4) (8,9) (5,4) (3,6) (0,4) Interest income 0,4 0,4 0,4 0,4 0,5 Other financial items (1,0) (2,1) (0,8) (0,6) (0,7) PROFIT OR (LOSS) BEFORE TAX (1,9) (57,7) (15,9) (8,3) (4,5) Taxes (0,5) (1,3) (0,4) (0,3) 0,0 NET PROFIT OR (LOSS) (2,4) (59,0) (16,3) (8,6) (4,5) 23

24 Financial position USD million Licences, design and other intangibles Investments in newbuildings under construction and vessels Shareholder loans to joint ventures Investments in joint ventures Mark-to market on hedging reserves Other assets Restricted cash (non-current) Unbilled construction contract receivable Current cash and marketable securities TOTAL ASSETS Total equity Investments in joint ventures Interest bearing debt Mark-to market on hedging reserves Other liabilities TOTAL EQUITY AND LIABILITIES Total equity adjusted for MtM on interest rate swaps Equity ratio adjusted for MtM on interest rate swaps 41 % 42 % 50 % 40 % 61 % Net interest bearing debt

25 Cash flow statement USD million 1Q2015 4Q2014 3Q2014 2Q2014 1Q2014 Net profit or (loss) before tax (2) (59) (16) (16) (4) Adjustments of non-cash P&L items (3) Dividend received from joint ventures Proceeds from sale of mooring Net changes in working capital, other 1 2 (1) (5) 6 Net cash flow from operating activities (7) 79 (1) Net (investments) proceeds in marketable securities (145) - - Investments newbuildings under construction and vessels (13) (231) (9) (369) (52) Investments in intangibles and equipment - (1) (0) (1) (0) Proceeds of repayment on shareholders loans Net cash flow from/(used in) investing activities 6 (188) (153) (367) (50) Net proceeds form equity issuance Proceeds from borrowings Repayment of borrowings (12) (23) (36) - (30) Dividend paid to non-controllling interest (MLP) (4) (2) Dividend paid to shareholders of the parent (7) Interest paid (11) (9) (7) (2) (2) Increase in restricted cash - (37) Other financing activities - (1) (1) (5) (8) Net cash flow from/(used in) financing activities (6) TOTAL CASH FLOW 14 (60)