Q2 and First Half 2018 - Wallenius Wilhelmsen Logistics

[Pages:31]Q2 and First Half 2018

Quarterly presentation

August 8th 2018

Highlights second quarter 2018

EBITDA adjusted for extraordinary items of USD 159 million Underlying positive volume development, especially for high & heavy However, ocean results impacted by lower rates, increased net bunker cost and unfavorable currency movements The newbuilding "Titus" was delivered end of May 2018 About USD 110 million in synergies confirmed Acquisition of 70% of Syngin Technologies for about USD 30 million

2

Agenda

Business update Financial performance Market and business outlook Outlook and Q&A

Business update

by Craig Jasienski

Business Update

Financial Performance

Market and Business Outlook

Outlook and Q&A

The positive volume & cargo mix development continued in the quarter

Volume and cargo mix development Million CBM and %

Comments

Total prorated volumes1

Cargo mix2

Million CBM

+3%

+12% % ? Positive volume development partly offset by

20

19,5

19,4

18,7

18,2

18,0 18,2

18,0

18,8

35 18,5

15

24,9%

25,1%

25,3%

23,3%

24,0%

15,5

24,9%

16,8

25,7%

15,2

25,4%

16,2

16,2

24,2%

26,0%

17,0

26,3%

26,1%

16,5

28,0%

29,2%

30 25

22,6%

20,4%

reduced contracted HMG volumes, up 3% y-o-y

? The Atlantic, Asia-South America and partly the AsiaEurope trade experienced strong growth

? The Oceania trade moved sideways, and the Europe-Asia and Asia-North America trade decreased (latter due to

20

reduction in HMG volumes)

10

? Adjusted for reduced contracted HMG volumes (about 0.5

15

million CBM) volumes were up about 6% y-o-y

10 ? Volumes up 12% q-o-q due to seasonality

5

5 ? Continued positive development for cargo mix with a high & heavy share of 29%, up from 28% in the

0

0

Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2 '18

previous quarter and 26% in same period last year

1) Prorated volume (WW Ocean, EUKOR, ARC and Armacup)

2) Calculated based on unprorated volumes. Updated figures based on aligned cargo type definition and reporting across all Ocean units

5

Business Update

Financial Performance

Market and Business Outlook

Mixed volume development for the foundation trades y-o-y

Outlook and Q&A

Atlantic Shuttle

+22% +9%

3.0

3.4

3.6

EU/NA ? Oceania1)

-1% +14%

2.0

1.8

2.0

Q2 '17 Q1 '18 Q2 '18

Q2 '17 Q1 '18 Q2 '18

WWL trade routes EUKOR trade routes ARC trade routes

Note: Prorated volumes on operational trade basis in CBM 1) Including Cape sailings (South Africa)

EU - ASIA

-4% +4%

3.2

2.9

3.0

Asia - EU

+5% +18%

3.2

2.9

3.4

Q2 '17 Q1 '18 Q2 '18

Q2 '17 Q1 '18 Q2 '18

Asia - SAWC

+21% +8%

1.1

1.2

1.3

Asia - NA

-14% +21% 3.4

2.9 2.4

Q2 '17 Q1 '18 Q2 '18

Q2 '17 Q1 '18 Q2 '18 6

Business Update

Financial Performance

Market and Business Outlook

Flat development for Net freight / CBM in the second quarter

Outlook and Q&A

Net freight / CBM development1)

44

42 41.0 40.5

40

0% 40.9

40.2

38 Q1'17

Q2'17

Q3'17

Q4'17

Comments

? Net freight / CBM increased by about 1% in the second quarter compared with the previous quarter due to changes in trade and cargo mix

+1%

40.5 40.2

? The largest volume growth in the quarter was seen in the Oceania and the Asia-Europe trades, with relatively high net freight / CBM (long distances)

? Furthermore, the increased high & heavy share also had a positive impact on net freight / CBM

? No material changes for rates

? No material rate changes q-o-q, but rate reductions from contract renewals in 2017 impacted the net freight index with about USD 12 million y-o-y

Q1'18

Q2'18

1) Net freight = Freight revenues adjusted for surcharge elements such as BAF, SRC, THC etc

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Business Update

Financial Performance

Market and Business Outlook

137 vessels operated at the end of the second quarter

Outlook and Q&A

Fleet development # of vessels

Comments

Owned Chartered Short Term T/C In/Out ? Wallenius Wilhelmsen operated a core fleet of 127

vessels (873K CEU), representing around 22% of the

137

127

131

131

131

132

5

6

6

9

10

global fleet in the second quarter

? One newbuilding (Titus) delivered end of May

? Three vessels from external owners chartered-in

51

49

50

49

46

49

? In addition, the group continued to leverage the

short-term market and controlled a fleet of 137

vessels at the end of the second quarter (up from

132 vessels in Q1)

76

77

75

76

77

78

? The increase of 5 vessels is linked to higher volumes in certain trades causing operational imbalances to meet customer commitments

Q1'17

Q2'17

Q3'17

Q4'17

Q1'18

Q2'18

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