Presentation to Dockwise 24 April 2012
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Economic value of Red Box and Green Box projects In 2012 and 2013 most of these projects will award marine transportation contracts Eldfisk $ 12M Guara Tupi BSR Moho Nord Nemba $ 15M Valemon Natuna $ 12M Solan Brass LNG $ 18M CMMP Iraq Golden Eagle $ 15M Sylwin deck SBM FLNG $ 16M Mafumeira $ 25M Barzan Offshore $ 25M IDG Gas $ 20M 2 vessels Point Thompson $ 50M Prudhoe Bay $ 50M Shtokman Offshore $ 30M 2 vessels Total segment value approx USD 350 million Total segment value approx. USD 2 billion Sunrise $ 75M 2 vessels Kitimat $ 50M 2 vessels Browse $ 175M+ 4 vessels Umm Lulu $ 50M Pluto $ 75M 4 vessels AP LNG $ 75M 2 vessels Arrow $ 75M 3 vessels Ichthys $ 175M+ 4 vessels Wheatstone $ 175M+ 4 vessels Shtokman $ 100M 4 vessels Gorgon $ 500M+ 9 vessels Yamal $ 300M 4 vessels The lead time from tender submission to contract award is on average 15 months 3
Fairstar current contracted Red Box/Green Box backlog (4 years) Vessel FJORD FJELL FORTE FINESSE Number of months contracted 29 months 23 months 44 months 26 months Total 122 months * Average dayrate USD 73,000 Total contract backlog value USD 303 million * 39 months are charterer s option 4
2013 and 2014 assumptions FJORD Revenue 2013 365 days @ USD 95,000/day (Gorgon) N/A 2014 66 days @ USD 95,000/day (Gorgon) 67 days @ USD 78,000/day (Golden Eagle) 232 days @ USD 85,000 day (Assuming 80% utilisation of the open contracts) Cost USD 17,000/day in opex and G&A FJELL Revenue 2013 365 days @ USD 65,000/day (Gorgon) N/A 2014 108 days @ USD 65,000/day (Gorgon) 257 days @ USD 70,000 day (Assuming 80% utalisation of the open contracts) Cost USD 17,000/day in opex and G&A 5
2013 and 2014 assumptions (cont d) FORTE Revenue 2013 365 days @ USD 70,000/day (Gorgon) N/A 2014 259 days @ USD 70,000/day (Gorgon) 106 days @ USD 70,000/day (Ichthys) N/A Cost USD 17,000/day in opex and G&A FINESSE Revenue 2013 63 days @ USD 81,000/day (Golden Eagle) 53 days @ USD 90,000/day (CMMP/Saipem) 249 days @ 75,000/day (Assuming 75% utilisation of the open contracts) 2014 300 days @ USD 70,000/day (Ichthys) 65 days @ USD 0 day Cost USD 17,000/day in opex and G&A 6
2013 and 2014 Sales and EBITDA 2013 2013 2013 2013 2014 2014 2014 2014 USDm Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2013 2014 Gross Revenue 34,7 32,5 32,1 30,4 24,5 28,4 30,0 30,0 129,7 112,9 Revenue (Time Charter Equivalent) 27,8 26,0 25,7 24,3 19,6 22,7 24,0 24,0 103,8 90,4 TCE FJORD 8,6 8,6 8,6 8,6 7,8 5,2 6,2 6,2 34,6 25,4 TCE FJELL 5,9 5,9 5,9 5,9 3,5 4,7 5,1 5,1 23,7 18,5 TCE FORTE 6,4 6,4 6,4 6,4 6,4 6,4 6,4 6,4 25,5 25,5 TCE FINESSE 6,8 5,1 4,8 3,4 1,9 6,4 6,4 6,4 20,1 21,0 Operating costs (OPEX/ G&A) -6,2-6,2-6,2-6,2-6,2-6,2-6,2-6,2-24,8-24,8 EBITDA FJORD 7,1 7,1 7,1 7,1 6,2 3,7 4,6 4,6 28,4 19,2 EDITDA FJELL 4,4 4,4 4,4 4,4 2,0 3,2 3,5 3,5 17,5 12,3 EBITDA FORTE 4,8 4,8 4,8 4,8 4,8 4,8 4,8 4,8 19,3 19,3 EBITDA FINESSE 5,3 3,6 3,2 1,9 0,4 4,8 4,8 4,8 13,9 14,8 EBITDA 21,6 19,8 19,5 18,2 13,4 16,5 17,8 17,8 79,1 65,6 Source: Fairstar 7
% of ratings Price (NOK) Analyst perspectives on valuation of Fairstar # of brokers 6 6 5 6 6 4 4 3 3 4 4 4 4 3 4 4 4 4 4 4 4 4 4 4 4 90% 25 Broker Date Rating Target (NOK) Upside from current trading 80% 20 ABG Sundal Collier 20-Apr-12 Buy 20.60 113% SEB Enskilda Research 20-Apr-12 Buy 12.00 24% 70% 60% 15 RS Platou Markets Buy 13.00 34% Terra Markets Buy 14.00 45% 50% Median 13.50 57% Average 14.90 45% 40% 10 Current trading 9.68 30% 20% 5 10% 0% apr-10 jul-10 okt-10 jan-11 apr-11 jul-11 okt-11 jan-12 apr-12 0 Buy Hold Sell Price (NOK) Target price Source: Factset 8
8:45 9:45 10:45 11:45 12:45 13:45 14:45 15:45 16:45 Market perspective on the bid from Dockwise 1 st day of trading Share Price 10,0 Volume ('000 shares) 140 9,5 9,0 120 100 80 8,5 8,0 60 40 20 7,5 0 Source> Bloomberg FAIR - Volume FAIR - Price 9
New-build parity analysis USDm Replacement cost FORTE 110 FINESSE 110 FJORD 90 FJELL 90 Total replacement cost 400 Net debt fully funded 255 Implied equity value of Fairstar 145 Total equity value (NOKm) 841 Equity value per share (NOK) 9,4 EBITDA less capex Q3 12 - Q2 14 (contracts) 122 EBITDA less capex Q3 12 - Q2 14 (NPV @ 10%) 110 Value per share of cash flow during newbuild construction period (NOK) 7,1 Implied value - vessels + cashflow during construction period (NOK) 16,5 10
An acquistion of Fairstar is value accretive to Dockwise shareholders up to NOK 14 per Fairstar share Assumptions Combination of Dockwise and Fairstar financials using Bloomberg estimates with cost synergies 1 of USDm 6 per annum (50% in 2013 and in 2014) Dockwise takes over all debt of Fairstar and acquires all shares in Fairstar through issuing of new Dockwise shares at current market value 16% 14% 12% 10% 8% 6% 4% 2% 0% -2% NOK 9.30 NOK 12.0 NOK 14.0 2013 accretion 2014 accretion 1) Cost synergies relate to cost savings on Board remuneration of USDm 2.3, advisory costs of USDm 1.6 (audit, tax and legal), listing costs of USDm 0.1, housing and office related expenses of USDm 1.0, sales and marketing of USDm 0.6 and cost savings on supporting staff of approx USDm 0.4 Bloomberg estimates: Dockwise net profit USDm 94 in 2013 and USDm 84 in 2014. Fairstar net profit USDm 46 in 2013 and USDm 35 in 2014 11
Contact details - Fairstar Heavy Transport NV Postal address Visiting address P.O. Box 2225 Weena 316-318, Tower A 3000 CE Rotterdam 3012 NJ Rotterdam The Netherlands The Netherlands Contact T +31 (0)10-403 5333 F +31 (0)10-403 5344 I www.fairstar.com E fairstar@fairstar.com Philip Adkins (CEO) M +44 (0)7796 681 414 E philip.adkins@fairstar.com This material has been prepared by Fairstar Heavy Transport NV ( FHT"). This material is for distribution only under such circumstances as may be permitted by applicable law. It has no regard to the specific investment objectives, financial situation or particular needs of any recipient. It is published solely for informational purposes. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in the materials. It should not be regarded by recipients as a substitute for the exercise of their own judgement. Any opinions expressed in this material are subject to change without notice and may differ or be contrary to opinions expressed by other business areas or groups of FHT as a result of using different assumptions and criteria. FHT is under no obligation to update or keep current the information contained herein. Neither FHT nor any of its affiliates, nor any of FHT s or any of its affiliates, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of this material. 2012 Fairstar Heavy Transport NV. All rights reserved. Fairstar Heavy Transport NV specifically prohibits the redistribution of this material and accepts no liability whatsoever for the actions of third parties in this respect. 12