J. Lauritzen A/S Investor Update Annual Report 2012

Transcription

1 J. Lauritzen A/S Investor Update Annual Report Oceans of know-how

2 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. 2

3 212 was challenging for the shipping industry - JL was influenced by the circumstances and recorded a USD (35)m loss in Write-downs and other one-offs accounted for USD (254)m - JL continued to develop its business and succeeded in strengthening its finances JL markets and business Lauritzen Bulkers Depressed dry bulk markets (a 25 year low) LB hit by counterparty defaults on two capes Vessels subsequently sold Lauritzen Kosan Tightening of sanctions against Iran No renewal of ETH time charters Lack of Euro-zone growth Declining markets for S/R Stable/improving markets for ETH and F/P Lauritzen Tankers Disappointing spot markets for product tankers Lauritzen Offshore (shuttle tankers) LO shuttle tankers are long-term employed Significant events in JL in 212 Formation of the AXIS Offshore J/V Issuance of JL s 2 nd corporate bond NOK 5m maturing in October 217 Financing secured for 3 MR product tankers Vessels to be delivered in 213 Significant events in JL in 213, so far Agreement with owner to convert subordinated loans (DKK 85m plus accrued interest) into equity Will increase YE 212 solvency from 37% to 44% Agreement regarding facility with 214-maturity Prolonged into 215 Change of guards : New JL President & CEO Torben Janholt retired Jan Kastrup-Nielsen appointed 3

4 212 net result of USD (349.7)m - In line with December 212 announcement - But considerably below expectations at beginning of 212 Key figures Comments USDm Revenue 621,1 79,4 EBITDA 146, 88,7 Depreciation (91,2) (25,) Profit on sale of vessels (36,2) (12,4) Operating result 18,5 (263,6) Income from joint ventures 4,7 (26,2) Finance net (69,2) (59,5) Tax and minorities (,3) (,5) JL's share of the result (46,2) (349,7) Fixed assets Hereof vessels under construction Net investments (vessels only) Profit margin 3,1% (37,9%) ROIC 1,1% (13,5%) Solvency ratio 44,7% 36,8% ROE (3,8%) (34,1%) Fleet (full year average) Average no. employees Note: Revenue includes other operating income Full Year Unsatisfactory result for 212 Result for 212 was significantly impacted by one-offs (i.e., settlements, write-downs, reversals and sale of vessels) as seen also in 21 and 211 Normalised EBITDA (i.e. EBITDA before one-offs) decreased from 211 to 212 mainly due to income lost caused by counterparty defaults and weak dry bulk markets despite revenue increase from 211 to 212 Depreciation and write-offs increased from USD 91m in 211 to USD 25m in 212 mainly due to impairments on vessels and vessels under construction (handysize/handymax dry bulk and product tankers) Decreasing net financial costs reflecting increasing margins on financing which were off-set by exchange rate gains and absence of refinancing costs seen in 211 not repeated in 212 4

5 212 normalized result of USD (95.4m) down from USD (21.m) in Result for 212 was significantly impacted by one-off items with a net effect of USD (254.4)m Key messages Income statement - condensed Actual One-off items Normalised One-offs relates mainly to: Impairments due to lower expected earnings Dry bulk Product tankers Counterparty defaults Sale of vessels Sale of claims Strategic initiatives Sale of vessel to form J/V Decrease in normalized EBITDA: Income lost caused by counterparty defaults Weaker dry bulk markets Note Revenue 1) Other operating income Costs 2) (475.1) (62.6) (477.6) (62.7) Profit before depreciation (EBITDA) Profit/(loss) on sale of assets 3) (36.2) (12.4) (44.7) (14.1) Depreciations and w rite-dow ns 4) (91.2) (25.) - (148.7) (91.2) (11.2) Operating income 18.5 (263.6) (25.2) (236.1) 43.7 (27.5) Share of profit in joint ventures 5) 4.7 (26.2) - (18.2) 4.7 (8.) Net financial items (69.2) (59.5) - - (69.2) (59.5) Profit/(loss) before tax (45.9) (349.2) (25.2) (254.4) (2.8) (94.9) Income tax Profit/(loss) for the year (44.) (348.4) (25.2) (254.4) (18.8) (94.1) Non-controlling interest's share of profit/(loss) (2.2) (1.3) - - (2.2) (1.3) The J. Lauritzen Group's share of profit/(loss) (46.2) (349.7) (25.2) (254.4) (21.) (95.4) One-off items include: 1) Proceeds from sale of claims and settlements received 2) Use of provisions for onerous charter contracts 3) Sale of vessels as a consequence of counterparty defaults or strategic initiatives 4) Write-downs on vessels and vessels under construction due to impairment 5) Write-downs on vessels owned by joint ventures due to impairment 5

6 USDm 212 versus result down from 211 due to one-offs, weaker bulk markets and counterparty defaults result lower than estimated due to write-downs Result 212 compared to (46,2) ,3 4,8 (71,2) (7,8) (,4) (3,2) 14,7 (58,5) (148,7) (18,2) (13,4) (15,4) 9,7 3,9 (349,7) 6

7 Total assets amount to USD 2.3b, down USD 366m (14%) from YE The decrease mainly relates to sale of vessels, depreciation, write-downs and the Axis Offshore J/V Key messages Fixed assets down by USD 43m: Write-downs and depreciations Sale of two Capesize vessels and one gas carrier Transfer of ASV to Axis Offshore Partly off-set by investments in newbuildings Solvency at 36.8% Will increase to 44% upon conversion of subordinated loans to equity ROIC unsatisfactory at (13.5)%. Investments, mainly related to seven deliveries three handysize bulk carriers, two product tankers, one gas carrier and one shuttle tanker Divestments: Sale of Christina Bulker, Gry Bulker and Karin Kosan At end-212 outstanding contractual commitments amounted to USD 14m (four vessels) Balance sheet Full Year E USDm Act Act Nex Oct Fixed assets Assets in operation Prepayments Invested in Joint Ventures Current assets Cash Total assets JL share on equity Minority share 2 1 Non current liabilities Current liabilities Solvency 44,7% 36,8% 41,2% ROE (3,8%) (34,1%) (16,%) NIBD/EBITDA 6,8 1,7 1,6 Investments (vessels only) Divestments (vessels only) ROIC 1,1% (13,5%) (4,8%) 7

8 Broker valuation declined by 16% (on average) on current fleet during Average Loan to Value on fully owned fleet of 76% (net of USD 33m in pledged cash provided as additional security) 6 Vessel values end 212 in USDm book values, broker values and mortgaged debt on fully owned fleet HS/HM CZ SR/FP ETH MR ST HS = Handysize BULK GAS TANK OFFSHORE HM = Handymax CZ = Capesize SR= Semi-refrigerated Book Value Debt (net of pledged cash) Market Value Vessel average age (RHS) FP = Fully-pressurized ETH = Ethylene MR = Medium range Book and market values as per end-dec 212. Debt as per end-dec 212. Fleet count as per end-dec 212 ST = Shuttletankers Note: Book value in Annual Report note 9 also include USD 23m relating to e.g. dockings etc. Totals may differ due to rounding 8

9 Cash flow from operations of USD 34m - Significantly down from USD 85.8 in 211 Key messages Cash flow from operations down by USD 52m: Lower EBITDA in 212 compared to 211 Increase in working capital caused by increased fleet and changed employment patterns Cash flow investments down by USD 221m: Final installments on seven deliveries in 212 (down from 18 in 211) Cash flow from financing down by USD 216m: Draw down at-delivery of facilities down in 212 from 211 (fewer vessels delivered) Proceeds from bond issue in October 212 Cash and unused credit facilities amounts to USD 268m, down USD (24)m from USD 292m at YE 211 Does not include USD 33m cash pledged as additional security in loan facilities Cash flow Full year USDm Actual Actual Nex Oct Cash flow from operations Cash flow from investments (329) (18) (129) Financial cash flow Change in cash position 8 33 (1) Cash position Total credit facilities Hereof used for: Mortgage debt *) (1.149) (1.29) (1.43) Corporate bonds *) (116) (216) (2) Subord. Loans and other debt (169) (161) (156) Unused credit facilities Funds available incl. unused facilities Minimum liquidity RCD/NIBD 8,% 3,5% (1,%) NIBD/EBITDA 6,8 1,7 1,6 EBIT/Interest expenses,3 (4,2) (1,6) FCF/Debt (23%) (7%) (1%) Liquidity Ratio 188,9 215,5 184,6 *) Formation costs not included 9

10 JL in a five year perspective - EBITDA for 212 impacted by counterparty defaults and challenging bulk markets like in Operational cash flow slightly positive, and significantly lower than in Revenues USDm Lauritzen Bulkers Lauritzen Kosan Lauritzen Offshore Lauritzen Tankers Reefer a.o Selected key figures USDm EBITDA EBIT Result for the year One-off items Cash and Cash flow from operations USDm 4 3, Capital structure USDm 3 2,5 2 2, Cash flow from operating activities 1,5 1, Cash and cash equivalents Total equity Non-current liab. Current liab. 1

11 Strategic position and strongholds of JL s business units - A diversified and well-positioned business Lauritzen Bulkers Lauritzen Kosan Lauritzen Tankers Lauritzen Offshore Business Unit Activity Carriage of dry bulk products Carriage of LPG and petrochemicals Carriage of clean petroleum products Service to the offshore oil and gas E&P industry Fleet Average 119 vessels in 212 Average 43 vessels in 212 Average 18 vessels in 212 Average 4 vessels in 212 Position Top-5 pool-operator of handysize vessels World leading operator of gas carriers of 3-1, m 3 Co-founder and member of Hafnia MR pool Long term contracts secured with major energy companies Industry characteristic Very fragmented. Volatile. Scale advantage, reputation, service Low/medium volatility. High entry barrier, know-how, scale, quality Fragmented. Volatile Scale, quality, reliability Few operators. Low volatility. High entry barriers, knowhow, scale, quality Strongholds Strategic advantageous position from pool scale and modern fleet Strategic advantageous position from modern fleet and leading pool Scale obtained via Hafnia MR pool Unique knowledge on dynamic positioning Key Competitors D/S Norden, Pacific Basin, Clipper Evergas, Unigas, Gaschem Anthony Veder, Unigas, IM Skaugen D/S Torm, A.P. Møller- Mærsk, Norient, Navig8 Teekay, Knutzen NYK, American Eagle Tankers 11

12 Result 212 distributed on business areas - EBITDA for 212 up on 211 in all business units except Lauritzen Bulkers Lauritzen Bulkers Lauritzen Kosan Lauritzen Tankers Lauritzen Offshore Business units USDm Revenue EBITDA Depreciations * (37.9) (15.7) (26.4) (27.2) (6.3) (55.3) (2.7) (16.8) Sale of assets (38.6) (96.6) (7.5) Operationg income (EBIT) (.7) (243.2) (4.9) Joint ventures 2.3 (28.6) (1.1). 2.7 Finance net (18.4) (25.) (3.7) (1.9) (5.8) (7.6) (11.6) (1.8) Result before tax (16.8) (296.8) (49.5) JL's share of the result (24.7) (294.5) (4.) (5.6) Invested capital (average) ROIC.1 % (24.5)% 2.7 % 2.7% 2.7 % (15.3)% 3.6 % 5.1% Average no of employees * Incl. write-downs Invested capital EBITDA Invested capital EBITDA Invested capital EBITDA Invested capital EBITDA 12

13 Total fleet of 175 vessels controlled by JL at year end newbuildings, hereof 4 fully-owned to be delivered - Operational fleet expected to grow 5% in 213 (18% in 212), mainly in handysize dry bulk and MR product tankers Lauritzen Bulkers Lauritzen Kosan Lauritzen Tankers Lauritzen Offshore Capesize Panamax Handymax Handysize Fully-pressurized Ethylene Semi-refrigerated MR product tankers 18 ASV Shuttletankers 1 3 Bulk fleet Kosan fleet Tanker fleet Offshore fleet Handysize Handymax Panamax Capesize Total New buildings Total Owned Part-owned B/B in T/C in *) Joint charters 3 3 Pool, etc Semi-refrigerated Ethylene Fully-pressurized Total New buildings Total Owned Part-owned 3 3 B/B in 5 5 T/C in *) 3 3 Joint charters Pool, etc MR product tankers Total New buildings Total Owned Part-owned 1 1 B/B in T/C in *) Joint charters 1 1 Pool, etc. 5 5 New buildings Total ASV Shuttletankers Total Owned 3 3 Part-owned B/B in T/C in *) Joint charters Pool, etc. * Not including time-charters with a duration of less than six months 13

14 Coverage strategy vary from segment to segment to reflect business model - Increased coverage in handysize/handymax beginning of 213 reflecting increased focus on CoAs - Reduced coverage for product tankers pending delivery of new buildings. Coverage in Ethylene hit by Iran sanctions Lauritzen Bulkers Lauritzen Kosan Lauritzen Tankers Lauritzen Offshore Business Unit Coverage strategy Handy (small bulk): Top-5 pool-operator in handysize dry bulk. Play the market. Huge customer base Cape/panamax (larger bulk): Basically vessels built against long term contracts (4 owned vessels on 7-13y t/c) Repeating customers Contracts are renewed (renegotiated annually) Long term employment mixed with spot employment. Spot employment via Hafnia MR Pool 2 shuttletankers on 11y bareboats. 1 shuttletanker on t/c until Aug 214. Long term contracts with oil majors Coverage rationale Small bulk, gas and product tankers: In segments where JL has scale, carries a high customer retention rate and, in general, segments recognised as highly liquid, coverage is decided on the basis of market outlook and market conditions. Larger dry bulk and in Offshore: High coverage preferred in segments with larger vessels, where JL has less scale and/or less liquid assets (larger vessels, larger cover) 1% 1% 1% 1% Cover at the beginning of the year 75% 5% 25% % Cape size Handy -max Handy -size % 57% 14% 13% % 5% 24% 24% 75% 5% 25% % F/P S/R Panamax Ethylene % 52% 52% % 58% 25% 75% 5% 25% % Medium Range % % 75% 5% 25% % Shuttle Tankers 212 1% 213 1% 14

15 Outlook in 213 in Dry Bulk and Gas on average below But improving during the year Dry Bulk: smaller segments has better balance Gas Carriers: 213 below 212 Spot Market Rates USD/Day Spot Market Rates USD'/Month Average of the 6 T/C Routes for the Baltic Handysize Index Average of the 6 T/C Routes for Baltic Supramax Index East (F/P) coaster West (S/R) coaster Baltic Exchange Dry Index (1st November = 1334) - RHS 65 S/R 1 ETH Source: J. Lauritzen A/S based on data from Clarkson Research Services Source: J. Lauritzen A/S based on data from Fearnley s Industrialization and urbanization in Asia continue to be key drivers supporting the dry bulk trade. 213 expected to see continuously low spot rates due to weak global economy and high delivery schedules However expectation of decelerating supply growth during the year and improved global economy will support dry bulk market in H2 Total net fleet growth expected to fall from 1.5% in 212 to 6% in 213. Market balance for handysize segment relatively well balanced Large surplus shipbuilding capacity will put pressure on tonnage prices in 213 Demand for smaller gas carriers almost stagnated 212 after having posted strong growth during 21 and 211 The fleet of smaller gas carriers increase by an estimated 4% during 212 Demand and supply expected to grow by approx. 3% in 213, however with demand lagging behind in 213-H1 15

16 Market Outlook in 213 (cont.) shipping is a cyclical business Product Tankers: Modest improvement with possible upside Product Tankers -Modest improvement during 213 Spot Market Rates Key Product Tanker Routes , 15, 1, 5, Shuttletankers Highly specialized tankers vessels, mainly employed in the North Sea and Brazil Medium entry barriers Rates expected to be negatively affected by new entrants in 213-5, BCTI TC2_37 TCE: 37,mt CPP Rotterdam- New York BCTI TC3_38 TCE: 38,mt CPP Aruba (Caribs) - New York BCTI TC4-TCE: 3,mt, CPP/UNL Singapore- Chiba (Japan) Source: J. Lauritzen A/S based on data from Clarkson Research Services 213 expected to be another year of low growth in global oil demand, due to weak economic activity and high oil prices. This implies low growth for product tankers demand as well. Refinery re-locations and refinery closures will support longer voyages could lift ton-miles demand and cause the market to improve more than expected The total product tanker fleet will grow by a couple of percent with the MR fleet expected to grow somewhat higher Overall the product tanker market is expected to see only modest improvement in

17 Debt overview - No refinancing until 215 (Agreement regarding facility with 214-maturity: Prolonged into 215) - Subordinated loans to be converted to equity Outstanding Debt (forecast) - Existing Facilities USDm 15 4 Repayment profile (forecast) - Existing Facilities USDm Term loans: Maturity (balloon at maturity) ECA backed term loans: with maturity in (fully amortized) Revolving facilities: Maturity (balloon at maturity) Unsecured bond: Maturity May 215 and October 217 Subordinated loans from owner: Maturity 215/222 Will be converted to equity Term loans Term loans ECA backed Revolving Bonds unsecured Subordinated loans Moved to Expiring bank loans expected to be refinanced at maturity Bond strategy involves total of USD 3mm on a rolling basis Bullit subordinated loans Bullit bonds Bullit bank loans Repayment Note: Bullet payments on existing bank facilities are normally refinanced on or before maturity by way of pledging the financed vessels in a new facility and using the proceeds to redeem the existing facility Note: Forecast. Actual data shown as per end-212. Numbers may change subsequently, e.g. in case of sale of a vessel, prepayment, reduction in use of revolving facilities, etc. Totals may differ due to rounding. Gross debt. Bond debt at hedged value. 17

18 Accomplishments in 212 and further initiatives will support and develop JL throughout 213 Markets in 213 on average in line with 212 However, several JL accomplishments in 212 and further initiatives will help improve JL s result for 213 Expensive dry bulk time-charters will be redelivered during 213 Coverage in the handysize and handymax (dry bulk) segment has been increased compared to last year Intensive work to reduce OPEX e.g. in the shuttle tanker segment, improve profitability Increased focus on working capital Increased competitiveness through: Project Rejuice will increase fuel efficiency Corporate Responsibility efforts: Responsible procurement Anti-corruption compliance program Greenhouse Gas Protocol (GHGP) And more initiatives are scheduled for EBITDA (excl. one-offs and deconsolidated activities) is expected to come in higher in 213 than in 212 Competence Respect Entrepreneurship Accountability Team spirit Enthusiasm IT ALL COMES DOWN TO PEOPLE 18

19 Recovery, however slow, expected from mid Result for 213 expected to be negative but better than EBITDA (comparable*) up on 212 due to redelivery of expensive T/C-vessels and increase of operated product tanker fleet JL group level EBITDA (comparable*) expected to be slightly higher in 213 than in 212; in the range of USD 6m-8m (In 212: USD 88.7 of which one-offs and EBITDA from ASV amounted to USD 33.7m) Depreciations will decrease by about 1% compared to 212 mainly due to write-downs and sale of assets in 212 Joint ventures expected to be unsatisfactory in 213 but up on 212 Net financials expected to be in line with 212; Currency and interest rate fluctuations may affect results Tax is expected to be limited and minorities share of result to decrease Net result in 213 thus expected to be an unsatisfactory USD (75-1)m but up from USD (35)m in 212 The first quarter of 213 is expected to be the most challenging one Business units Lauritzen Bulkers: EBITDA excl one-offs expected to to be somewhat better than 212 but slightly negative Lauritzen Kosan: EBITDA expected to be in line with 212 Lauritzen Offshore: EBITDA* (shuttletankers only) expected slightly up on 212 Lauritzen Tankers: EBITDA expected to be positive and better than 212 Sensitivity guidance Business Unit Change +/- Change in result +/- Bulk (small) 1, USD/day USD 13.4m Bulk (large) 1, USD/day USD.4m Gas 5 USD/day USD 1.7m Tank 1, USD/day USD 4.1m *) Comparable EBITDA excluding 212 one-offs and EBITDA related to Dan Swift, the accommodation and support vessel sold into J/V Axis Offshore as per July 1,

20 Summary of messages - A diversified and well-positioned business operating in volatile markets - JL has a proven track record in not only managing change and market turmoil, but also in customer satisfaction, innovation and building strong relations with customers, partners and other stakeholders Business JL has been hit by counterparty defaults in dry bulk (market hit a 25 year low point in 212): Defaults have since 21 affected JL s results negatively and have reduced JL s long term contract cover, however In an expected weak market for 213, JL expects to deliver improved EBITDA (comparable) and improved net result Increased coverage in small bulk, redelivery of expensive T/Cs and continued focus on operation (OPEX, sales and admin. costs) will help improve EBITDA Financials Solvency will be strengthened by conversion of subordinated loans to equity Liquidity continues to be satisfactory No refinancing exposure until will be difficult: A gradual and slow recovery not likely before mid-213 Decreasing vessel values and continued low earnings will be challenging Strategy is to be prudent, to consolidate but also prepare to grow its business further Dry bulk and product tankers: Current markets represent windows of opportunity for chartering of tonnage Gas: Grow Far Eastern fully-pressurized business and expand in larger size Ethylene vessels Offshore: Continue focus on ASV via the AXIS Offshore joint venture Keeping solid liquidity and controlling the leverage remains key Bond strategy unchanged Sale of selected assets are also considered as part of strategy implementation 2

21 Appendix CAPEX and financing on fully-owned newbuildings Charter commitments (operational lease liabilities) and contingent liabilities Market outlook Glossary Contact details Fleet list 21 Oceans of know-how

22 Fully-owned newbuildings (CAPEX and financing) Status end Remaining CAPEX of USD 14m on 4 fully-owned newbuildings - Committed financing secured for 3 product tankers - Bulk carrier to be delivered in 213 held free of mortgage *) USDm Investment Committed Cash, program financing net Outstanding CAPEX 3 Product Tankers Handysize Bulk Carrier -32 *) Deliveries in Total remaining deliveries Amount of committed financing based on fair market value of vessels as per end December 212 Note: *) Expected to be used as additional security in existing facility in order to release cash which is currently pledged as security 22

23 Charter obligations and committed charter income - Expensive (vis-a-vis current market) time charter commitments in dry bulk tailing of in During 213, 35% of current time-charter commitments will expire Operational lease liabilities at end 212 USDm Lauritzen Bulkers Lauritzen Kosan Lauritzen Offshore Lauritzen Tankers J. Lauritzen Total - 1 Year Year > 5 Year Total Number of vessels chartered in Herof included chartered vessels where: JL has purchase option JL has option to extend Contractual committed charter income (T/C and B/B) at end 212 USDm Lauritzen Bulkers Lauritzen Kosan Lauritzen Offshore Lauritzen Tankers J. Lauritzen Total - 1 Year Year > 5 Year Total Number of vessels chartered out: Note: Above does not include income from committed contracts of affreightment (COAs) 23

24 Contingent liabilities - Change from 211 to 212 mainly caused by the formation of AXIS Offshore - See also note 19 in the 212 Annual Report for further details JL has a contingent liability relating to the Axis Offshore joint venture of USD 47m JL continues to guarantee the loan facility relating to ASV Dan Swift now owned by AXIS Offshore Contingent liabilities at year end USDm USDm Guarantees undertaken for debt in joint ventures Max. obligation to pay in capital into joint ventures 8 45 Guarantees regarding newbuildings

25 Dry Bulk: On average 213 expected to be below H2 expected to see improved markets The Dry Bulk Market Supply of Dry Bulk Carriers (Beginning of Year) DWTm Capesize Panamax Handymax Handysize Demand for Dry Bulk Carriers DWTm Capesize Panamax Handymax Handysize Spot Market Rates USD/Day Bulk Carrier Age Profile and Order Book at Year-End 212 (% of Existing Fleet) 12.% 1.% 8.% 6.% 4.% 2.%.% Handysize Handymax Panamax Capesize Average of the 6 T/C Routes for the Baltic Handysize Index Average of the 6 T/C Routes for Baltic Supramax Index 25 years or more years -14 years Order book Baltic Exchange Dry Index (1st November = 1334) - RHS Source: J. Lauritzen A/S based on data from Clarkson Research Services 25

26 Small Gas Carrier: 213 expected to be weaker than Demand and supply expected to grow by 3%, however with demand lagging behind Small Gas Carrier Market Demand for smaller gas carriers by product (Mill Tons) Ethylene Propylene Butadiene VCM LPG Ammonia Supply of Smaller Gas Carriers By Type in CBMm S/R vessels F/P vessels Spot Market Rates USD'/Month East (F/P) coaster West (S/R) coaster 65 S/R 1 ETH Smaller Gas Carriers Age Profile And Order Book At Year End 212 (% of existing Fleet) 12.% 1.% 8.% 6.% 4.% 2.%.% Semi-refrigerated Fully-pressurised 25+ years years -14 years Order boook Sources: J. Lauritzen A/S based on data from Clarkson Research Services, Viamar AS and Fearnley s 26

27 MR Product Tanker: Modest improvement expected in 213 The MR Product Tanker Market Global Refined Products Trade (Mill Tons) Gasoline Kerosene Residual fuel Gas and diesel oil Other products Supply of Product Tankers DWTm Dwt Dwt Dwt 8.+ Dwt 2, 15, 1, 5, Spot Market Rates Key Product Tanker Routes , BCTI TC2_37 TCE: 37,mt CPP Rotterdam- New York BCTI TC3_38 TCE: 38,mt CPP Aruba (Caribs) - New York BCTI TC4-TCE: 3,mt, CPP/UNL Singapore- Chiba (Japan) 1.% 8.% 6.% 4.% 2.%.% Product Tankers age Profile And Order Book At Year-End (% Of Existing Fleet) MR (4-6.dwt) LR1 (6-8.dwt) 25 years or more years -14 years Order book Source: J. Lauritzen A/S based on data from Clarkson Research Services 27

28 Glossary Aframax: Crude oil tanker or product tanker too large to pass through the Panama Canal and below 12, 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 8, 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 1, and 25, dwt Handymax, dry cargo: Dry bulk carrier of between approximately 4, and 6, dwt. Handysize, dry cargo: Dry bulk carrier of between approximately 1, and 4, dwt. IMO: International Maritime Organization A maritime organization under the UN, 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 meters and length of meters) of approximately 5, 8, dwt. LR2, product tanker: Long Range 2. Product tanker too large to pass through the Panama Canal of approximately 8, dwt. Medium Range, tanker (MR): Product tanker of between 25, and 5, 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 metres and length of metres) of approximately 5, 8, dwt. Panamax, dry cargo: Dry bulk vessel with the maximum dimensions for passing through the Panama Canal (width of metres and length of metres) of approximately 6, 8, 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 12, 2, 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 2, and 32, dwt. VLGC: Very Large Gas Carrier. LPG ship with capacity above 6, cbm. 28

29 Contact details Investor relations Jacob Winthereik Financial Investor Relationship Manager, Group Treasury Phone: Web: Press & Media Jens Søndergaard Senior Vice President, Corporate Communications Phone: Web: 29

30 JL FULLY OWNED VESSELS 31 December 212 Built Vessel/Type Vessel Flag Owner subgroup GAS 29 Victoria Kosan ETH IOM LKS 29 Leonora Kosan ETH IOM LKS 1996 Lizzie Kosan F/P SNG LKS 1998 Bente Kosan F/P SNG LKS 1999 Brit Kosan F/P SNG LKS 21 Helle Kosan F/P IOM LKS 211 Inge Kosan F/P IOM LKS 211 Linda Kosan F/P IOM LKS 211 Monica Kosan F/P IOM LKS 27 Helena Kosan ETH IOM LK 27 Isabella Kosan ETH IOM LK 28 Henrietta Kosan ETH IOM LK 28 Alexandra Kosan ETH IOM LK 21 Anette Kosan F/P PAN LK 23 Charlotte Kosan F/P PAN LK 211 Tracey Kosan F/P IOM LK 212 Emily Kosan F/P IOM LK 1992 Cervantes S/R MAR LK 1994 Telma Kosan S/R IOM LK 1998 Tessa Kosan S/R IOM LK 1998 Tenna Kosan S/R IOM LK 1999 Tilda Kosan S/R IOM LK 1999 Tanja Kosan S/R IOM LK 1991 Berceo S/R IOM Gasnaval BULK 29 Camilla Bulker Capesize PAN LB 211 Cassiopeia Bulker Capesize MTA LB 211 Corona Bulker Capesize MTA LB 211 Churchill Bulker Capesize MTA LB 211 Tess Bulker Handymax IOM LB 211 Tanager Bulker Handymax IOM LB 211 Toucan Bulker Handymax IOM LB 211 Thunderbird Bulker Handymax IOM LB 23 Lilja Bulker Handysize MTA LB 27 Amine Bulker Handysize MTA LB 27 Sofie Bulker Handysize MTA LB 21 Louise Bulker Handysize PAN LB SO II 21 Signe Bulker Handysize PAN LB 21 Emma Bulker Handysize PAN LB SO II 21 Emilie Bulker Handysize IOM LB 211 Elvira Bulker Handysize IOM LB SO II 211 Hedvig Bulker Handysize PAN LB SO II 212 Nicoline Bulker Handysize IOM LB SO II 212 Anne Mette Bulker Handysize IOM LB 212 Eva Bulker Handysize IOM LB 25 Tenna Bulker Handysize SNG JLS 28 Maren Bulker Handysize PAN JLS 28 Laura Bulker Handysize SNG JLS 21 Orchard Bulker Handysize SNG JLS 21 Sentosa Bulker Handysize SNG JLS TANK 24 Freja Atlantic MR DIS LT 21 Freja Pegasus MR UK LT 21 Freja Nordica MR PAN LT 211 Freja Taurus MR UK LT 211 Freja Andromeda MR UK LT 212 Freja Crux MR DIS LT 212 Freja Lupus MR DIS LT OFFSHORE 1999 Dan Eagle Shuttletanker DIS LSS 211 Dan Cisne Shuttletanker DIS LSS 212 Dan Sabiá Shuttletanker DIS LSS

31 JL PART-OWNED VESSELS 31 December 212 Built Vessel/Type Size JL GAS Cbm. owner share 28 Stella Kosan (ETH) 9,18 5.% 28 Stina Kosan (ETH) 9,18 5.% 28 Sophia Kosan (ETH) 9,18 5.% BULK Dwt. 25 Durban Bulker 32,544 5.% 212 Milau Bulker 37,8 5.% 1989 Id Bulker 26,97 1.% 1994 Ideal Bulker 28, % 1994 Mediterranean ID (Amazonia) 28, % 1995 ID Harbour 28, % 1995 Idas Bulker 27,321 2.% 1995 Scan Bulker 27, % 1996 Arctic ID 28, % 1996 Caribbean ID (Mt Cook) 27, % 1996 Marine Bulker 28, % 1997 Baltic ID 28, % 1998 Obelix Bulker 7,529 2.% 21 Bianco Bulker 52, % 24 Bianco Dan 55,628 4.% 24 Bianco Venture 33, % 28 Idship Bulker 28,5 18.% 29 Danship Bulker 28, 14.% 29 ID North Sea 28, 14.% 212 Bianco Victoria Bulker 32,5 5.% TANK Dwt. 24 Freja Polaris 37, % OFFSHORE 29 Dan Swift 6, 5.%