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Höegh LNG – The FSRU provider
3Q 2017Presentation of financial results
16 November 2017
Forward looking statements
2
This presentation contains forward-looking statements which reflects management’s current expectations, estimates and projections about
Höegh LNG’s 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; changes to
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, including the impact from changes in financial
markets; changes in the ability to achieve 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.
3Q 2017 highlights
Operational update
Market outlook
Financial overview
Summary
Appendix
3
3Q 2017 highlights and subsequent events
4
▪ EBITDA of USD 31.6 million, or USD 40.6 million net of non-recurring items
▪ Net profit of USD 1.1 million, or USD 10.8 million net of non-recurring items
▪ Dividend of USD 0.125 per share
▪ Höegh LNG Partners raised USD 115 million of new preferred equity
▪ Sale of the remaining 49% interest in Höegh Grace to Höegh LNG Partners
▪ Financial close for up to USD 230m million in debt finance for FSRU #8
3Q 2017 highlights
Operational update
Market outlook
Financial overview
Summary
Appendix
5
Solid operational performance across global fleet
6
99.87% 99.70% 99.95% 99.94% 99.82% >99.50 %
2013 2014 2015 2016 2017TD Target
Technical availability
1.07
0.44
0.73
0.00
0.40
<1.00
2013 2014 2015 2016 2017TD Target
Lost time injury frequency1
1 Per million work hours
Independence
PGN FSRU Lampung
Höegh GallantHöegh Grace
Neptune
FSRU NB
FSRU NB
Arctic Lady
Arctic Princess
GDF Suez Cape AnnHöegh Giant
FSRU intermediate trading
LNG carrier
FSRU
FSRU NB
FSRU contract with future start-up
GNF time charter positions HLNG for further FSRU opportunities
7
▪ Firm time charter signed with Gas Natural SDG, SA (GNF)
▪ Höegh LNG will provide an FSRU to GNF’s portfolio of LNG
assets
▪ Rate structure dependent on mode of use
Spot linked LNGC rate
Pre-agreed FSRU rate
▪ The time charter commences in early 2018 and has an
initial term of three years, ensuring continuous employment
with FSRU potential
▪ Höegh LNG has full substitution rights and will initially
assign the FSRU Höegh Giant to the contract
Successful dropdown of the remaining 49% of Höegh Grace to HMLP
8
▪ Agreement to sell 49% of Höegh Grace to
Höegh LNG Partners
▪ Purchase price of USD 172.5 million, less
USD 86.6 million in pro rata indebtedness
▪ Total equity proceeds to Höegh LNG
Holdings from drop downs and operation of
USD 186.1 million
USD 91.8 million for the first 51% interest
USD 85.9 million for the remaining 49% interest
USD 8.4 million in net earnings contribution to
Höegh LNG Holdings Ltd. during 1-3Q 2017
Project development update
9
GEI / Pakistan
▪ Infrastructure consortium not able to conclude on form
and structure
▪ Höegh LNG is evaluating its options under the FSRU
contract with GEI
Quantum
Power / Ghana
▪ Government to decide on regasification solution and
supplier
GNL Penco /
Chile▪ Revised environmental impact study continues
Built EBITDA Charterer
USDm/yr 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038
Höegh LNG Holdings
Arctic Princess* 2006 19** Statoil
Arctic Lady* 2006 19** Total
Independence 2014 47 KN
Höegh Giant 2017 GNF
FSRU#8 2018
FSRU#9 2018
FSRU#10 2019
Höegh LNG Partners
Neptune 2009 33** Engie
GDF Suez Cape Ann 2010 33** Engie
PGN FSRU Lampung 2014 40 PGN
Höegh Gallant 2014 38 Egas
Höegh Grace**** 2016 42 SPEC
Long-term contract LNGC interim trading FSRU/LNGC charter Extension option Under construction
2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037
Fleet allocation subject to optimisation pending firm contract awards
10
* LNG carriers
** 100% basis, units are jointly owned
**** Höegh Grace 51% owned by Höegh LNG Partners
Long-term contracts under development
New contract awards
Diverse channels feeding promising pipeline of new projects
11
Tendering
activity
▪ In final rounds of several tender processes representing
startup dates between 2018 and 2021
▪ Multiple tender processes in earlier stages of development
Strategic
partnerships
▪ Discussions underway regarding several potential FSRU
projects to be undertaken on a joint basis with Nakilat
Supplemental
offerings
▪ Designs developed for small-scale regasification solutions
▪ Associated infrastructure an integral part of Höegh LNG’s
offering
3Q 2017 highlights
Operational update
Market outlook
Financial overview
Summary
Appendix
12
The LNG market expanding on the back of new liquefaction capacity
13
Source: GIIGNL, Höegh LNG
264Million tonnes
2016 LNG exports
~105 Million tonnes
Capacity under construction
as of end-2016
+80% Potential increase from 2016 levels
assuming full utilisation
~24Million tonnes
Qatar expansion
Global LNG trade up 13% year on year through October 2017
14
Global monthly LNG trade, 2010-2017
Source: Clarksons Platou
15
17
19
21
23
25
27
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Mill
ion t
onnes o
f LN
G
2010 2011 2012 2013 2014 2015 2016 2017 (est)
US exports fuelling ton-mile demand and supporting LNG shipping rates
▪ Incremental LNG volumes shipped longer distances with US/Asia developing as a dominant trade
▪ Increasing volumes, longer sailing distances and seasonal LNG demand supporting LNGC rates
▪ Uptick in rates and improving LNGC outlook seem to have calmed LNGC/FSRU conversion
speculations
15
0
2
4
6
8
10
12
14
1Q 2015 3Q 2015 1Q 2016 3Q 2016 1Q 2017 3Q 2017
Millio
n t
on
nes
per
an
nu
m,
an
nu
alised
US LNG exports by destination
Caribbean Latin/South America Europe Africa MEG Asia
Source: EIA, Clarksons Platou
0
20
40
60
80
100
120
140
160
2009 2010 2011 2012 2013 2014 2015 2016 2017
Ch
art
er
hir
e r
ate
(‘0
00 $
/day)
160k TFDE (SPOT) 145k+ ST (SPOT)
LNGC TCE spot earnings
FSRUs have become the preferred regasification solution
16
0
5
10
15
20
25
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Un
its
Global FSRU contracts in operation
Other Höegh LNG
Active uptake of FSRUs and busy tendering activity
17
Countries with FSRUs Countries with awarded FSRUs Countries contemplating FSRUs
2nd FSRU
in Pakistan
4q 2017
2nd FSRU
in Turkey
4Q 2017
China again
using FSRU
for LNG
imports
Bali FSU/FRU
FSRU fleet growth reflecting the market momentum
▪ The orderbook stands at 12
FSRUs
▪ Long-lead items have been
ordered for 3-5 conversion
projects
18
OLT
MOL
Gazprom
Maran
Kolin Kalyon
1 Orderbook defined as firm orders, excluding LOIs, options, conversions not firmed up
SWAN
Dynagas
Dynagas
Java-1
7
9
5
2 2
2
1
2
1
4
1
1
3
0
2
4
6
8
10
12
Höegh LNG Excelerate Golar LNG BW Gas Other
Un
its
FSRU fleet and orderbook1 by owner/employment
Committed Available Committed NB Uncommitted NB
Exmar
3Q 2017 highlights
Operational update
Market outlook
Financial overview
Summary
Appendix
19
Financial highlights
20
▪ 3Q 2017 impacted by a
provision relating to a
performance claim on Neptune
and GDF Suez Cape Ann,
relating to the initial years
when they were operated as
LNG carriers, partly offset by
the reversal of certain sales-
tax-related accruals
USD million 3Q 2017 2Q 2017 YTD 2017 YTD 2016
Income statement
Total income 64.0 70.6 203.4 159.5
EBITDA 31.6 37.7 105.9 80.1
Net profit after tax 1.1 8.5 21.1 13.2
Dividend per share (USD per share) 0.125 0.125 0.375 0.20
Financial position
Cash and marketable securities 285 303
Total assets 1,992 2,002
Adjusted equity 649 664
Interest bearing debt 1280 1285
Net interest bearing debt 962 947
Adjusted equity ratio 32.7 % 33.3 %
Strong underlying earnings performance in 3Q 2017
21
EBITDA variance 2-3Q 2017 Net profit variance 2-3Q 2017
1
1 Sales tax accrual, re-classified as income, with corporate tax
effect with net amount of USD 2.2 million positive impact on
3Q 2017 financials
Further diversificaiton of funding sources
22
Instrument Perpetual preferred equity ECA debt financing of FSRU#8
Size and pricing • USD 115 million gross / USD 111.4
million net
• 8.75% Cumulative Redeemable
Preferred Units
• Up to USD 230 million facility
comprising USD 150 million ECA and
up to USD 80 million commercial
bank tranche
• Fixed interest rate of 3.9% with 10
year blended tenor
Details • Issuer call option on or after 5 years
at par
• Use of proceeds: repayment of
Seller’s credit from Höegh Gallant
drop down (USD 34 million) and
general corporate purposes including
acquisitions
• Norwegian ECA backed debt
financing (GIEK and Eksportkreditt)
• 65% leverage without employment
requirement increasing to 75% upon
securing long term employment
Strong balance sheet supporting underlying business risk
23
▪ Repayment of unsecured bond
(HLNG01) in October 2017 and
preferred equity issue in Höegh
LNG Partners positively
impacting 3Q 2017 pro forma
equity ratio by 5.5%
▪ Delivery of FSRUs under
construction adversely
impacting 3Q 2017 pro forma
equity ratio by 6.9%, assuming
USD 200 million debt drawing
each, net of scheduled debt
amortization during
construction period
▪ Minimum equity ratio under
loan documents 25%
0
20
40
60
80
100
120
140
160
180
2014 2015 2016 1-3Q 2017annualized
US
D m
illio
n
HMLP proceeds to Höegh LNG
Equity release Grace II MLP distribution IDR
Höegh LNG Partners - an attractive source of growth capital
24
▪ Cash received from HMLP:
USD 397 million in IPO and drop-
down proceeds Höegh Gallant
and Höegh Grace
USD 70 million in distribution and
IDRs
IPO1
Höegh
Gallant1
51% of
Höegh
Grace
1 Pre-funding of Höegh Gallant acquisition in IPO proceeds in 2014
49% of
Höegh
Grace in
Q4 2017
Gallant
seller’s
credit
Fully equity funded for remaining newbuilding programme
25
1 Does not include incremental capital expenditures on Ghana
2 Due to timing differences between lifting of CP on projects and scheduled capital
expenditures, equity contributions to the newbuilding programme may occur at a different
timing than illustrated
Source USDm
Cash & marketable securities 253
Settlement Gallant seller’s credit 34
49% Grace drop-down proceeds, net 77
HLNG01 repayment in October -104
Outstanding revolver 33
Financing FSRU #8 no employment requirement 200
Total liquidity 495
Incremental financing Höegh Giant upon l/t employment 29
Incremental financing FSRU #8 upon l/t employment 30
Assumed financing FSRU#9-10 >400
Total funding >954
Remaining newbuilding capex1 ~650
Funding of remaining capex (USD ~0.65 billion)1+2Liquidity at 30 September 2017 (ex HMLP)
29
200-230
~200
~~200
-100
0
100
200
300
400
500
600
2017 2018 2019
US
D m
illio
n
Höegh Giant debt FSRU #8 debt FSRU #9 debt FSRU #10 debt Equity
3Q 2017 highlights
Operational update
Market outlook
Financial overview
Summary
Appendix
26
27
LNG demand increasing 12% in 1-3Q 2017 underpinning FSRU demand
Summary
USD 0.125 per share dividend
EBITDA of 31.6 million, or USD 40.6 million net of non-recurring items
Strong financial platform and equity funded for newbuilding program
Promising pipeline of new projects from diverse channels
28
Q&A sessionCall-in details:
Norway +47 21 00 26 10
United Kingdom +44 (0)330 336 9105
United States +1 323 794 2093
Participant passcode: 2189205
Webcast:
http://webtv.hegnar.no/presentation.php?webcastId=67733847
3Q 2017 highlights
Operational update
Market outlook
Financial overview
Summary
Appendix
29
Segment information USDm
Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3
Income statement 2017 2016 2017 2016 2017 2016 2017 2016 2017 2016
Freight revenues 37.5 24.8 32.4 28.7 - - - - 70.0 53.5
Management and other income 0.1 - 0.6 1.0 1.3 - - - 2.0 1.0
Share of results from inv. in JVs (9.2) 2.4 1.3 1.1 - - - - (7.9) 3.5
TOTAL INCOME 28.4 27.2 34.3 30.8 1.3 - - - 64.1 58.0
Charterhire expenses - - (8.9) (8.9) - - - - (8.9) (8.9)
Bunker and other voyage related expenses - - (0.1) (0.1) - - - - (0.1) (0.1)
Operating expenses (6.0) (4.8) (7.3) (6.9) (0.1) (0.4) - - (13.4) (12.1)
Project administrative expenses (0.7) (0.6) (1.6) (1.2) (2.3) (1.0) - - (4.6) (2.8)
Group administrative expenses (1.3) (1.7) - - - - (2.5) (3.5) (3.8) (5.2)
Business development expenses - - - - (1.7) (2.4) - - (1.7) (2.4)
EBITDA 20.4 20.1 16.4 13.7 (2.8) (3.8) (2.5) (3.5) 31.6 26.5
Total
Group ex. HMLP
HMLP Operations BD and project execution Corporate and other
Segment reporting1
30
1 Please see note 3, Segment information, in the 2Q 2017 quarterly report for further details, as
well as note 5 commitments and financing for a detailed debt overview
2 Due to US GAAP reconsiliation the HMLP segment is not directly comparable to reported
financials from Höegh LNG Partners
EBITDA from assets owned by
HMLP, including 100%
consolidation of Höegh Grace
The cost of
managing the group
Costs of securing
new business
EBITDA from commercial
contracts and assets on the water
2
Income Statement
31
USD million 3Q2017 2Q2017 1Q2017 4Q2016 3Q2016
Freight revenues 70.0 65.2 64.5 56.9 53.6
Management and other income 2.0 2.0 0.7 1.7 1.0
Share of results from investments in joint ventures (7.9) 3.4 3.4 3.7 3.5
TOTAL INCOME 64.0 70.6 68.6 62.3 58.1
Charterhire expenses (8.9) (8.9) (8.8) (8.9) (8.9)
Bunker expenses (0.1) (0.5) (0.1) (0.2) (0.2)
Operating expenses (13.3) (13.0) (11.7) (10.6) (12.1)
Project administrative expenses (4.6) (4.8) (4.3) (4.3) (2.9)
Group administrative expenses (3.8) (3.9) (5.1) (5.7) (5.2)
Business development expenses (1.7) (1.8) (1.9) (1.4) (2.3)
EBITDA 31.6 37.7 36.7 31.2 26.5
Depreciation (11.2) (10.6) (9.3) (9.1) (9.2)
Reversal of impairment (impairment) - (0.4) - - -
EBIT 20.4 26.7 27.4 22.1 17.3
Interest income 0.5 0.8 0.4 0.3 0.3
Interest expenses (16.6) (16.3) (13.8) (13.3) (14.3)
Other financial items - (1.0) (0.6) (5.6) 1.1
PROFIT (LOSS) BEFORE TAX 4.3 10.2 13.4 3.5 4.4
Taxes (3.2) (1.6) (1.9) (2.7) (1.1)
NET PROFIT (LOSS) 1.1 8.5 11.4 0.8 3.3
Financial position
32
USD million 30.9.17 30.6.17 31.3.17 31.12.16 30.9.16
Newbuildings under construction and FSRUs 1 599 1 604 1 374 1 269 1 245
Shareholder loans to joint ventures 3 4 6 7 9
Mark-to-market on hedging instruments 19 6 8 8 0
Other assets 72 71 77 78 71
Restricted cash (non-current) 14 14 14 19 23
Current cash and marketable securities 285 303 364 332 268
TOTAL ASSETS 1 992 2 002 1 843 1 713 1 616
Total equity 576 582 593 596 442
Investments in joint ventures 44 39 41 49 76
Interest-bearing debt 1 261 1 264 1 084 936 955
Mark-to-market on hedging instruments 39 46 51 57 72
Other liabilities 72 71 74 75 71
TOTAL EQUITY AND LIABILITIES 1 992 2 002 1 843 1 713 1 616
Total equity adjusted for hedging reserves 649 664 672 677 576
Equity ratio adjusted for hedging reserves 33% 33% 37% 40% 36%
Net interest bearing debt 962 947 705 585 663
Cash flow statement
33
USD million 3Q2017 2Q2017 1Q2017 4Q2016 3Q2016
Net profit or (loss) before tax 4 10 13 4 4
Adjustments of non-cash P&L items and interest 36 23 20 21 19
Net changes in working capital, other (4) - (5) (3) (4)
Net cash flow from operating activities 36 33 28 22 19
Net (investments) proceeds in marketable securities 170 20 (75) 55 25
Investments newbuildings under construction and vessels (2) (238) (111) (33) (4)
Proceeds of repayment on shareholders loans, other 1 2 1 2 2
Net cash flow from/(used in) investing activities 169 (216) (185) 24 23
Net proceeds form equity issuance - - - 112 -
Proceeds from borrowings - 191 175 - -
Repayment of borrowings (18) (15) (27) (15) (15)
Dividend paid to non-controllling interest (MLP) (8) (8) (7) (5) (4)
Dividend paid to shareholders of the parent (9) (9) (10) (8) (8)
Interest paid (18) (18) (14) (14) (14)
Increase/decrease in restricted cash 2 (3) 3 (1) -
Other financing activities (1) (1) (8) 1 -
Net cash flow from/(used in) financing activities (52) 137 112 70 (41)
TOTAL CASH FLOW 153 (46) (45) 116 1