Q2 & 6 Months 2006 Results Presentation August 10, 2006

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Transcription:

Q2 & 6 Months 2006 Results Presentation August 10, 2006

Forward Looking Statements "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and observations. Included among the factors that, in the company's view, could cause actual results to differ materially from the forward looking statements contained in this press release are the following: changes in demand a material decline or prolonged weakness in rates in the shipping market changes in rules and regulations applicable to the shipping industry, including, without limitation, legislation adopted by international organizations such as the International Maritime Organization and the European Union or by individual countries actions taken by regulatory authorities changes in trading patterns significantly impacting overall vessel tonnage requirements changes in the typical seasonal variations in charter rates increases in costs including without limitation: changes in production of or demand for oil and petroleum products, generally or in particular regions crew wages, insurance, provisions, repairs and maintenance changes in general domestic and international political conditions changes in the condition of the company's vessels or applicable maintenance or regulatory standards (which may affect, among other things, the company's anticipated drydocking or maintenance and repair costs) and other factors listed from time to time in the company's filings with the Securities and Exchange Commission, including, without limitation, its Annual Report on Form 10-K for the period ended December 31, 2005 and its subsequent reports on Form 10-Q and Form 8-K Page 2

Q2 2006: Major Highlights Increased total cargo carried by 47% and time charter days by 25% - marginal decrease of 2.5% in revenues (over Q2 2005) Absorbed reduction in freight rates per ton of 32%, reduction in daily time charter-out hire rates of 28% and increase in fuel costs of 47% per metric ton (over Q2 2005), and port congestion, higher drydockings and vessel repositioning Strong operational performance during continued market weakness in Q2 2006 demonstrates the stability of our business model and our ability to adapt our bulk business to the evolving needs of our clients Acquired 1 vessel during the month of May 2006 expanding the controlled fleet to 32 vessels Reduced long term debt by an additional $ 8.7 million maintained moderate net debt to capitalization ratio of 34% Entered into a new $ 140 million facility refinancing existing indebtedness and providing flexibility for further growth Page 3

Q2 2006 Operating & Financial Highlights In million $ (except EPS & share numbers) Q2 2006 Q2 2005 Q 2006/Q 2005 Voyage Revenues 43.8 44.0-0.4 % Time Charter Revenues 14.8 16.5-10 % Other Revenues.4.0 Total Revenues 59.0 60.5-2.5% Net Income 6.4 13.8-54 % EBITDA (*1) 15.8 19.7-20% EPS diluted (*2) $0.23 $0.52-56 % Weighted Average Common Shares 28,088,310 20,555,063 7,533,247 (*1) non-gaap financial measure. A reconciliation of EBITDA to Net Income is provided on page 11. (*2) EPS for Q2 2006 would have been $ 0.27 without the $ 1.1 million charge for business re-engineering fees incurred in Q2 2006. This re-engineering project will end during Q4 of 2006. Page 4

Q2 2006 Revenue Metrics VOYAGE REVENUES Q2 2006 Q2 2005 2006/2005 Average number of vessels 21 17 +24% Freight Voyage Days 1,866 1,536 +22 % Freight Rates per ton (1) -For all cargoes -Excluding Aggregates $ 42.39 $ 53.44 $ 62.49 $ 63.80-32% -16% -Total tons of cargo shipped -Tons of cargo shipped excluding aggregates 1,033,488 763,601 703,855 687,340 +47% +11 % (1) Weighted Average freight rates TIME CHARTER REVENUES Q2 2006 Q2 2005 2006/2005 Average number of vessels 12 10 +20% Time Charter Days 1,125 901 +25% Daily Charter-Out Hire Rate $ 13,179 $ 18,258-28% Page 5

Six Months 2006 Operating & Financial Highlights In million $ (except EPS & share numbers) Six Months 2006 Six Months 2005 Six Months 2006/2005 Voyage Revenues 93.1 90.1 +3% Time Charter Revenues 29.0 31.2-7% Other Revenues 0.6 0.1 Total Revenues 122.7 121.4 +1 % Net Income 13.7 30.0-54% EBITDA (*1) 32.4 39.9-19 % EPS diluted (*2) $0.49 $1.11-56 % Weighted Average Common Shares 28,088,310 20,470,887 7,617,423 (*1) non-gaap financial measure. A reconciliation of EBITDA to Net Income is provided on page 11. (*2) EPS for Six Months 2006 would have been $ 0.53 without the $ 1.1 million charge for re-engineering fees incurred in Q2 2006. This re-engineering project will end during Q4 of 2006. Page 6

Six Months 2006 Revenue Metrics VOYAGE REVENUES Six Months 2006 Six Months 2005 Six Months 2006/2005 Average number of vessels 22 18 +22% Freight Voyage Days 3,897 3,152 +24% Freight Rates per ton (1) -For all cargoes -Excluding Aggregates $ 45.13 $ 51.32 $ 61.36 $ 61.97-27% -17% -Total tons of cargo shipped -Tons of cargo shipped excluding aggregates 2,063,708 1,747,089 1,468,613 1,452,098 +41% +20 % (1) Weighted Average freight rates TIME CHARTER REVENUES Six Mos. 2006 Six Mos. 2005 Six Mos. 2006/2005 Average number of vessels 12 9 +33% Time Charter Days 2,162 1,649 +31% Daily Charter-Out Hire Rate $ 13,412 $ 18,935-29% Page 7

Fleet Development 6-2006 12-2005 12-2004 Controlled Vessels at period end 32 31 18 Chartered Vessels at period end 3 6 10 On May 2, 2006 TBS took delivery of the M/V Aztec Maiden increasing our controlled fleet to 32 vessels On August 8, 2006 TBS agreed to sell M/V Dakota Belle, a 1977 built multipurpose tweendecker with expected delivery in September 2006 Business first fleet second growth strategy Focus on multipurpose tweendeckers and handysize bulk carriers Page 8

Consolidated Balance Sheet Highlights In million $ Cash and Equivalents Vessels, net Total Assets Total Debt (including current portion) Capital Leases (including current portion) Shareholders Equity Net Debt/Total Capitalization 6/2006 11.7 273.5 328.9 88.5 23.2 191.8 34% 12/2005 27.2 266.9 342.4 105.7 24.7 177.8 37 % Page 9

New Credit Facility New $ 140 million credit facility led by Bank of America (July 31, 2006) Refinance existing indebtedness working capital additional vessel acquisitions $ 75 million self amortizing term loan with a 4 year term and $ 65 million revolving credit facility Consolidation of indebtedness under one facility better terms and more flexibility ability to execute our growth strategy Page 10

EBITDA Reconciliation EBITDA Reconciliation In million $ Net Income Net interest expense Depreciation Three Months Ended June 30, 2006 $6.4 2.5 6.9 2005 $13.8 2.0 3.9 Six Months Ended June 30, 2006 2005 $13.7 $30.0 5.4 3.6 13.3 6.3 EBITDA $15.8 $19.7 $32.4 $39.9 Page 11

Current Environment Markets: Global shipping markets under recovery Increased demand for commodities and infrastructure materials in Asia and Latin America our core markets Global boom in energy and construction projects around the world generating increased demand for shipping tonnage TBS: Increased volume of business in our core markets Improved freight rate environment Business re-engineering and optimization study In the 6M 2006, we grew our business, maintained our market share, expanded our fleet, developed new business opportunities & maintained moderate leverage Page 12

Appendix APPENDIX Page 13

TBS: A Unique & Growing Shipping Franchise We provide complete transportation solutions to our customers globally A mixture of tariff based liner, parcel, and bulk transportation services focusing on non-containerized cargoes Long standing position in our core markets of Latin America and Asia Regularly scheduled liner / parcel services in many of our markets supplemented by time charters to our customers Focus on multipurpose tweendeckers and handysize bulk carriers Moderate leverage Prudent growth after careful research and testing of new market opportunities Our business model differentiates us from traditional drybulk operators Page 14

Our Trade Routes 5 Trade Routes TBS Pacific Service operates eastbound and westbound liner and parcel services from East Asia to the West or North coasts of South America. TBS Latin America Service operates sailings between the East and West Coasts of South America. TBS North America Service operates bulk cargo services between South America and North America. TBS Ocean Carriers offers shipping solutions worldwide on a customer-by-customer basis including sailings from Brazil to the West Coast of Africa. TBS Middle East Carriers offers bulk service within the Middle East region within the Middle East region from ports in the United Arab Emirates (UAE) to ports in Kuwait and Qatar. Page 15

Global Network & Focus on Customer Relationships Professional Worldwide Staff 31 nationalities 7 full-time port captains Fully staffed agencies and representative offices on 5 continents Seoul Tokyo Shanghai New York Hamilton Mexico City Dominican Republic Guatemala Caracas San Jose Bogota Quito Guayaquil Lima La Paz Sao Paulo Rio De Janeiro Santiago Buenos Aires Hamburg London Lagos Page 16

TBS Revenue Mix Well-balanced customer and cargo base By Cargo By Geography By Customer Size $180 $160 $140 $120 $100 $80 $60 $40 $20 $180 $160 $140 $120 $100 $80 $60 $40 $20 $180 $160 $140 $120 $100 $80 $60 $40 $20 $0 $0 2002 2003 2004 2005 2002 2003 2004 2005 Steel Products Concentrates Brazil Other Latin America Fertilizers Bulk Cargo Japan USA Agricultural Products General Cargo Korea China Other Rest of World Note: Revenue breakdowns apply to freight revenue only. ($ millions) Page 17 $0 2002 2003 2004 2005 5.0% and Greater 3.0% - 4.9% 1.0% - 2.9% Less than 1.0%

Our Growth & Business Development Philosophy We develop long-term business relationships based on providing full service transportation solutions Our long-term business growth strategy is to continue solidifying and expanding our franchise business while researching and developing new growth opportunities We grow our fleet in response to the growth in our business (a business first fleet second strategy) New growth opportunities are identified and tested primarily with chartered vessels Balanced revenue sources create a sustainable business model Capital retention and low leverage provide financial flexibility Page 18

Fleet Fundamentals Smaller Fleet Strategy Fleet of 20 Multi-Purpose Tweendeckers (17,300 37,400 dwt) uniquely able to fulfill our mission Fleet of 12 Handysize Bulk Carriers (35,000 45,500 dwt) complements our Tweendeckers Why our vessels work for us and our customers Project Cargo NY001M2F_Co rel\ boat_sand.cdr Steel Coils Bulk Optimal cargo capacity for our markets Retractable Tweendeck Self-loading / self-discharging 10 cbm grabs Accommodates multiple cargo types Retractable Tweendeck optimizes floor space and cargo flexibility Project Cargo Steel Coils Construction Equipment Pipes Tractors Generators Paper Steel Plates Wire Rods Bulldozers Page 19

Contacts Visit our website at www.tbsship.com Company Contact: Ferdinand V. Lepere Executive Vice President and Chief Financial Officer TBS International Limited Tel. 914-961-1000 InvestorRequest@tbsship.com Investor Relations/Media: Nicolas Bornozis Capital Link, Inc., New York Tel. 212-661-7566 nbornozis@capitallink.com Page 20