IR Presentation May 2015
Transcript of IR Presentation May 2015
Revenue & Operating Profit
Quarterly Results (recent 4Q)
0.0
2.0
4.0
6.0
8.0
10.0
12.0
-
5.0
10.0
15.0
20.0
2010 2011 2012 2013 2014
Offshore Shipbuilding E&I OP margin
Revenue & OP Margin Trend
13.1 13.4
14.5 14.8
12.9
10.8
8.7
8.3
6.2
(KRWt) (%) 2014 2015
2Q 3Q 4Q 1Q
Revenue 3,107 3,263 3,078 2,610
Operating Profit 262 182 101 26
OP Margin 8.4% 5.6% 3.3% 1.0%
Income Before Tax 263 175 46 33
Net Profit 206 172 41 11
Revenue decline in 1Q15 :
- Lower sales contribution of drillships and less working days
Lower operating margin in 1Q15 :
- Sales mix change
· More revenue of low margin P/J (Ichthys&Egina), and less revenue of high margin drillships
- One off extra cost for Egina P/J occurred
(KRWb)
1.4
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Financial Summary
Consolidated Statements of Income
2010 2011 2012 2013 2014 2015 1Q
Revenue 13,146 13,391 14,490 14,835 12,879 2,610 2,610
Operating Profit 1,432 1,160 1,206 914 183 26 26
OP Margin 10.8% 8.7% 8.3% 6.2% 1.4% 1.0% 1.0%
Income Before Tax 1,298 1,150 1,045 819 190 33 33
Net Profit 1,000 851 796 632 106 11 11
(KRWb)
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Financial Summary
Consolidated Statements of Financial Position
2010 2011 2012 2013 2014
Total Assets 18,850 16,414 16,635 17,427 17,122
Cash & Cash Equiv. 1,255 1,289 1,164 1,140 893
Inventories 607 540 699 842 1,169
Accounts Receivable 5,449 4,078 5,091 5,935 6,400
Advanced Payments 1,638 1,675 1,501 1,354 1,204
Hedge Related 3,370 2,592 2,064 2,035 1,113
Total Liabilities 14,718 11,770 11,352 11,581 11,549
Advanced Receipts 5,431 5,602 3,967 3,885 3,799
Interest Bearing Debt 2,838 1,784 3,193 2,937 3,827
Hedge Related 3,578 2,452 1,458 1,725 1,093
Total Equity 4,132 4,644 5,283 5,846 5,573
Paid in Capital 1,155 1,155 1,155 1,155 1,155
Treasury Stock △662 △659 △657 △656 △970
(KRWb)
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Risk Hedging Policy
SHI Focuses on minimizing profit volatility
Building Event
Time Gap (months) 12 5 3 10
Currency
Receivable
Payable
Raw Material
Main Engine
Machinery
Steel Plate
Bulk Part
Contract Steel Cutting Keel Laying Launching Delivery
: Hedging, Order : Execution, Delivery
Foreign currency exposure is fully covered through forward transaction at the stage of shipbuilding contract
Main engine and machinery are ordered within 1~2 months after contract signing
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New Order
Apr 2015
Trend
-
2
4
6
8
10
12
14
16
2011 2012 2013 2014 2015.Apr
Container Ship LNG Carrier
Tanker Drilling Rig
Production Facility Others(WTIV etc.)
2.5
14.9
9.6
13.3
7.3
(USDb)
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Container
-ship
64%
LNG
Carrier
17%
Tanker
19%
Unit USDb
Containership 10 1.6
LNG Carrier 2 0.4
Tanker 8 0.5
Total 20 2.5
$2.5 billion (20 Units)
Order Backlog
Apr 2015
Trend
0
5
10
15
20
25
30
35
40
45
2011 2012 2013 2014 2015.Apr
Shipbuilding Offshore
38.3 37.2 37.5
32.6
Container
Ship 13%
LNG Carrier
16%
Tanker 6%
Drilling Rig
23%
Production
Facility 39%
Others 3%
(USDb)
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Unit USDb
Containership 32 4.1
LNG Carrier 25 5.3
Tanker 22 1.7
Drilling Rig 13 7.8
Production 9 12.7
Others 7 1.0
Total 108 32.6
$32.6 billion (108 Units)
34.8
Balanced supply & demand to generate solid order flow
- Mega containership market to be led by global alliances to achieve operational efficiency
and cost competitiveness among peers
Containership
Delivery decline & stable trade growth Global order trend & SHI market share
(Source: Clarksons, SHI assumption)
72
10
62
29
10 8
14%
28%
0%
5%
10%
15%
20%
25%
30%
0
10
20
30
40
50
60
70
80
'11 '12 '13 '14
Global Order (Over 10kTEU) SHI M/S
(Source: SHI)
1,839
972
215 120
7.9%
4.8%
1.0%
0.6%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
'15(e) '16(e) '17(e) '18(e)
Delivery Fleet Growth Trade Growth
Trade growth to be stable above 6%
(unit) (,000TEU)
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(M/S)
Short term demand to remain healthy due to shale gas export projects
in North America
LNG Carrier
US LNG export projects in progress
= approximately 120 vessels needed
Global order trend & SHI market share
48
32
39
59
18
4
14
5
38%
13%
36%
8%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
10
20
30
40
50
60
70
'11 '12 '13 '14
Global Order SHI M/S
(Source: SHI)
P/J Export
Capacity (mtpa)
First LNG
Status
Sabine Pass 27.0 ’15~
Under construction
Free Port 13.2 ‘17~
Cove Point 5.8 ’17~
Cameron 12.0 ‘18~
Corpus Christi 13.5 ‘18~ Under
Development Lake Charles 15.0 ‘17~
Total 86.5
(Source: company data, SHI assumption)
(unit)
* transportation capacity / vessel ≒ 0.7mtpa
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* around 30 vessels already ordered as of year 2014
(M/S)
US
Australia
Qatar
Yet to FID
2000 2005 2010 2015 2020 2025
0
50
100
150
200
100 250
300
350
400
450
500
Exporting or under construction
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LNG Carrier
Positive long term outlook due to increasing demand for an economical
and clean energy source
Global LNG Trade Forecast (MTPA)
Downturn to be continued for a while due to shrinking investment in
exploration but demand for high specification drillship is expected
Drillship
Next generation: 20K BOP drillship
New demand for 20K BOP drillship is expected
- For safe and efficient operation in high-pressure
and high-temperature deepwater reservoirs
Global order trend & SHI market share
(Source: SHI)
25
19
12
4
10 9
5
2
40%
47%
42%
50%
0%
10%
20%
30%
40%
50%
60%
0
5
10
15
20
25
30
'11 '12 '13 '14
Global Order SHI M/S
(unit)
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(M/S)
• BP-Maersk “Project 20K”
Jointly developing next generation drillship
using 20K BOP for Gulf of Mexico since
year 2013
Seeking both growth and profitability in offshore EPC market through
enhancement of EPC execution capability with ongoing projects
Production Facility
What we do for strengthening competitiveness Key projects under construction
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Ichthys CPF(Gas), Austrailia
Egina Oil FPSO, Nigeria
Lessons Learned Program
- Accumulating and systemizing knowledge learned from current projects to execute following better
Reinforcement of engineering capacity
- New R&D center established only for FEED, FEED verification, detailed design etc.
- Recruiting experienced engineers and project managers
Organizational improvement
- Risk management team and offshore package procurement team established
SHI’s new growth engine
- Market to expand due to its cost advantages and environmental benefits
FLNG
Concept & Advantages
Production, treatment, liquefaction and offloading
of natural gas to be carried out on a vessel
- No need for extensive pipe lines and onshore
processing facilities
Less CAPEX required
Natural Gas
Pretreatment
Liquefaction
World-wide FLNG P/J under Consideration
Number Projects
Under construction
3 Prelude(Shell)
Kanowit, Rotan (Petronas)
Active 10
Browse1,2,3(Shell)
Mozmbique(ENI),
Block R(Ophir) etc.
Potential 38
Total 51
(Source: Clarkson World Offshore Register )
3 Projects will be delivered during year ‘15~’18,
and 10 projects are actively under study
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SHI leads the market with solid relationship with strategic partners and
accumulated experience in the field
FLNG
Long term relationship with the leading companies
(Source: SHI, Shell)
Prelude Browse
Region Austrailia Austrailia
LNG Capacity 3.5 12.0
Contract amount 6 USDb under discussion
FID 2011 2016 mid
Delivery 2016 under discussion
First Gas 2018 2021
Remark - Key pre-FEED work Completed,
Entering FEED in mid-2015
2 major projects are underway based on long term agreement with Royal Dutch Shell and Technip
that are leaders of FLNG market
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Appendix- Global Network
Oslo
London
Athens Tokyo
Dubai
Rongcheng
Ningbo
Singapore
Houston
Malaysia
Houston
India
Moscow
Rio De Janeiro
Lagos
Shanghai
Shipyard Block Factory Engineering Center Branch Office
Global production and engineering bases enable SHI to meet various needs of customers
Block Factories in China (2) Ningbo (Since 1997) , Rongcheng (Since 2007)
Offshore Engineering Centers (2) Houston [ASOG (J/V with AMEC)], India (Noida)
Branch Office (12) London, Oslo, Athens, Moscow, Lagos, Dubai, Malaysia, Singapore, Shanghai, Tokyo, Huston, Rio De Janeiro
Geoje Shipyard
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Appendix- Shipyard View
Site : 4.0million ㎡
Quay Wall Length : 7.9Km (24 vessels)
3 Floating Cranes : 3,000 / 3,600 / 8,000ton
8 Docks (3 Dry Docks & 5 Floating Docks) ▪ No. 1 : 283m × 46m ▪ NO. 2 : 390m × 65m ▪ No. 3 : 640m × 98m ▪ G1 : 270m × 52m ▪ G2 : 400m × 55m ▪ G3 : 400m × 70m ▪ G4 : 420m × 70m ▪ G5 : 158m × 150m (only for Offshore)
SHI Focuses on minimizing profit volatility
Offshore Facilities
Dry Dock No.2
Floating Dock 3
Dry Dock No.3
Floating Dock 2
Floating Dock 4
Main Building
Dry Dock No. 1
ShinHanne Factory
Floating Dock 1
Floating Dock 5
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Disclaimer
This presentation has been prepared by Samsung Heavy Industries Co., Ltd. and contains forward-looking
statements that are subject to risks, uncertainties, and assumptions.
The presentation is solely for your information, subject to change without notice, and makes no
representation or warranty, expressed or implied and no reliability should be placed on the accuracy,
fairness, or completeness of the information presented herein.
The Company, its affiliates, or representatives accept no liability for any losses arising from any information
contained in the presentation.
The contents of this presentation may not be reproduced, redistributed or circulated, directly or Indirectly,
to any other person or organization, or published, in whole or in part, for any purpose.
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