FINANCE & CSR Capital Markets Day Michael Tønnes Jørgensen Executive Vice President & CFO Copenhagen, Denmark 1 June 212 NORDEN Finance & CSR 1
AGENDA Financials Risk management Corporate Social Responsibility NORDEN Finance & CSR 2
KEY FINANCIAL FIGURES EBITDA, sales gains and net profit USDm 8 7 6 5 4 3 2 1 EBITDA Sales gains Net profit 22 23 24 25 26 27 28 29 21 211 Cash flows, operations and investments USDm 6 4 2-2 -4 22 23 24 25 26 27 28 29 21 211 Cash from operations Net cash from investments Dividend and share buyback ROE & ROIC USDm 4 35 Share buyback 3 Dividend 25 2 15 1 5 22 23 24 25 26 27 28 29 21 211 12% 1% 8% 6% 4% 2% % ROE ROIC 22 23 24 25 26 27 28 29 21 211 NORDEN Finance & CSR 3
FINANCIAL POSITION Strong financial position and solid financial resources Undrawn credit facilities of USD 15 million Cash and securities exceed net interest bearing debt by USD 289 million 4 6 Gearing still low despite of increase in net committments Significant investment capacity Cash and Securities (USDm) 136 315 318 623 829 735 613 47 45 22 23 24 25 26 27 28 29 21 211 212 Q1 Gearing 1,6 1,4 1,2 1,,8,6,4,2-25 26 27 28 29 21 211 212 NORDEN Finance & CSR 4
REVIEW - OFF BALANCE SHEET ITEMS Off balance sheet items include: Newbuilding installments Value of TC vessels Value of cargo and TC contracts Assets (USDm) Liabilities (USDm) 4.5 45 4. 1,735 993 4 1,735 993 3.5 3. 2.923 35 3 2.923 2.5 2. 1.5 2,53-61 189 25 2 15 1.679 131 182 189 1. 1 5 5 Assets before adj. Own fleet market value adj. NB obligations Right of use assets Unallocated Drycargo Tanker Value of contractual cover Total assets after adj. Equity Debt Other liabilities NB payments TC liabilities Unallocated Drycargo Tanker Contractual cover oblig. Total liabilities after adj. NORDEN Finance & CSR 5
VALUATION OF NORDEN SHARE Current share price 3% below NAV Up to Q3 28 share price always above steel NAV Current valuation implies: 5 year PMX bulker = USD 16.5m 5 year MR Tanker = USD 18.2m Share Price and Net Asset Value 7 6 5 DKK/share 4 3 2 1 23 Q1 24 Q1 25 Q1 26 Q1 27 Q1 28 Q1 29 Q1 21 Q1 211 Q1 212 Q1 NAV Value of CP Share price NORDEN Finance & CSR 6
CASH CONVERSION Changes in working capital nets out over time Accumulated cash flow from operations for the period almost equal to accumulated EBITDA Cash conversion ratio 21.1 4,,7 1,1 1,2,6 1, 1,1,4 1,7 1,5,2,4 1,6 2,3 1,6 1,7.,3,7,8 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 27 28 29 21 211 212 NORDEN Finance & CSR 7
RISK MANAGEMENT IN NORDEN Actively take risks, which we believe we should own Proactively reduce / minimize all other risks We can risk a deal, but we cannot risk our company Market risk Hedged Hedge oil price exposure Hedge fixed, known currency exposure Cash balance only in short term deposits Hedge interest exposure Counterpart risk Accept but reduce Credit rating of counterparts Refundment guarantees on newbuilding contracts Downpayment on vessel sales Cash placed with large reputable banks 3 Default risk Close monitoring Monitor gearing based on adj. debt including all off-balance sheet items Maintain cash cushion (liquidity risk) Strict gearing and cash limits approved by Board of Directors Detailed forecast of cash flows based on various scenarios Operational risk Accept but reduce Insurance Culture and education IT Corporate Governance NORDEN Finance & CSR 8
CSR - A SYSTEMATIC APPROACH CORE TARGETS OF STRATEGY Grow Dry Cargo volumes and book by 15% p.a. Critical mass in Tankers: 25+ owned vessels UN GLOBAL COMPACT Human rights Labour Considered preferred employer within shipping community globally The ability to attract, retain and develop talent Beat peers total return to shareholders Additional value creation from new business BUSINESS STRATEGY NORDEN Environment Anti-corruption CSR 4 focus areas Energy and climate Maritime safety and security Employee conditions Anti-corruption Flexibility Reliability Empathy Ambition VISION MISSION VALUES The preferred partner in global tramp shipping. Unique people. Open minded team spirit. Number one. NORDEN Finance & CSR 9
RECAP Strong earnings throughout the cycle Active risk management Capital structure enabling substantial growth potential Strong financial position Business driven CSR Tanker NORDEN Finance & CSR 1
Thank you for your attention ANY QUESTIONS? NORDEN Finance & CSR 11