EX-99.1 2 d1225996_ex99-1.htm d1225996_ex99-1.htm
EAGLE BULK SHIPPING INC.
Jefferies 2011 Global Shipping Conference
7 September 2011
 
 
 
EAGLE BULK SHIPPING INC.
2
Forward Looking Statements
This presentation contains certain statements that may be deemed to be “forward-looking statements” within the
meaning of the Securities Acts. Forward-looking statements reflect management’s current views with respect to
future events and financial performance and may include statements concerning plans, objectives, goals,
strategies, future events or performance, and underlying assumptions and other statements, which are other
than statements of historical facts. The forward-looking statements in this presentation are based upon various
assumptions, many of which are based, in turn, upon further assumptions, including without limitation,
management's examination of historical operating trends, data contained in our records and other data available
from third parties. Although Eagle Bulk Shipping Inc. believes that these assumptions were reasonable when
made, because these assumptions are inherently subject to significant uncertainties and contingencies which
are difficult or impossible to predict and are beyond our control, Eagle Bulk Shipping Inc. cannot assure you that
it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could
cause actual results to differ materially from those discussed in the forward-looking statements include the
strength of world economies and currencies, general market conditions, including changes in charterhire rates
and vessel values, changes in demand that may affect attitudes of time charterers to scheduled and
unscheduled drydocking, changes in our vessel operating expenses, including dry-docking and insurance costs,
or actions taken by regulatory authorities, ability of our counterparties to perform their obligations under sales
agreements, charter contracts, and other agreements on a timely basis, potential liability from future litigation,
domestic and international political conditions, potential disruption of shipping routes due to accidents and
political events or acts by terrorists. Risks and uncertainties are further described in reports filed by Eagle Bulk
Shipping Inc. with the US Securities and Exchange Commission.
 
 
 
 
EAGLE BULK SHIPPING INC.
3
§ Strategy
§ Company
§ Industry
§ Financials
§ Key Takeaways
Agenda
 
 
 
Strategy
 
 
 
EAGLE BULK SHIPPING INC.
Global Leader in the Supramax Asset Class
5
5
Company Statistics
 
June 2005
September 2011
% Change
Fleet
Number of vessels
11
45*
+309.1%
Total DWT
540,456
2,451,641
+353.6%
OTW Average Age (years)
5.8
4.4
-24.1%
Commercial
Chartering Strategy 
(6 months, 2nd half)
Fixed
100%
55%
-
Indexed
0%
8%
-
Open
0%
37%
-
Operational
Fleet Utilization
n/a
99.5%
-
Technical Managers
1
3**
-
Financial
Enterprise Value
$509m
$1,203m
+136.3%
**Including in-house unit.
*Includes one remaining newbuilding.
 
 
 
EAGLE BULK SHIPPING INC.
6
Source: Clarksons
Supramax Asset Class Continues to Outperform
Eagle Bulk supramaxes generating positive cash flow
2011 Average Daily Spot Rates
(January 1 to August 31)
 
 
 
EAGLE BULK SHIPPING INC.
Evolving Commercial Strategy, Supramax Focused
7
7
Almost 10m tons in COA business booked, equating to 2,500 vessel days
 
 
 
Company
 
 
 
EAGLE BULK SHIPPING INC.
9
 
Vessel
DWT
Year
Built
 
Vessel
DWT
Year
Built
 
Vessel
DWT
Year
Built
1
Roadrunner
57,809
2011
16
Thrasher
53,360
2010
31
Skua
53,350
2003
2
Puffin
57,809
2011
17
Golden Eagle
55,989
2010
32
Shrike
53,343
2003
3
Petrel
57,809
2011
18
Egret Bulker
57,809
2010
33
Tern
50,200
2003
4
Owl
57,809
2011
19
Crane
57,809
2010
34
Kittiwake
53,146
2002
5
Oriole
57,809
2011
20
Canary
57,809
2009
35
Goldeneye
52,421
2002
6
Nighthawk
57,809
2011
21
Bittern
57,809
2009
36
Osprey I
50,206
2002
7
Thrush
53,297
2011
22
Stellar Eagle
55,989
2009
37
Falcon
50,296
2001
8
Martin
57,809
2010
23
Crested Eagle
55,989
2009
38
Peregrine
50,913
2001
9
Kingfisher
57,776
2010
24
Crowned Eagle
55,940
2008
39
Condor
50,296
2001
10
Jay
57,802
2010
25
Woodstar
53,390
2008
40
Harrier
50,296
2001
11
Ibis Bulker
57,775
2010
26
Wren
53,349
2008
41
Hawk I
50,296
2001
12
Grebe Bulker
57,809
2010
27
Redwing
53,411
2007
42
Merlin
50,296
2001
13
Gannet Bulker
57,809
2010
28
Cardinal
55,362
2004
43
Sparrow
48,225
2000
14
Imperial Eagle
55,989
2010
29
Jaeger
52,248
2004
44
Kite
47,195
1997
15
Avocet
53,462
2010
30
Kestrel I
50,326
2004
 
 
 
 
TOTAL VESSEL COUNT
44
TOTAL DWT
2,393,641
AVERAGE AGE (by DWT)
4.4yrs
One of the Largest and Youngest Supramax Fleets
2H 2011
CHARTERING
POSITION
FIXED
INDEXED
OPEN
55%
8%
37%
 
 
 
EAGLE BULK SHIPPING INC.
10
Vessel-owned Days
Eagle Bulk Fleet CAGR of 26.4%
One remaining newbuilding to take delivery of in 4Q 2011
 
 
 
EAGLE BULK SHIPPING INC.
11
Eagle Bulk Cargo Mix
2Q 2011
     
   
 
 
   
 
 
3
Iron Ore
655,711
17.5%
Total Major Bulk
2,100,355
56.1%
 
 
 
Minor Bulk
 
 
4
Other Ores
355,600
9.5%
5
Miscellaneous
292,976
7.8%
6
Steels / Pig Iron / Scrap
203,625
5.4%
7
Potash / Fertilizer
185,441
5.0%
8
Coke
181,491
4.9%
9
Forest Products
167,931
4.5%
       
11
Cement
75,106
2.0%
       
13
Alumina / Bauxite
35,421
1.0%
Total Minor Bulk
1,639,122
43.9%
 
 
 
Total Cargoes
3,739,477
100.0%
Cargo diversification leads to stable earnings
 
 
 
Industry
 
 
 
EAGLE BULK SHIPPING INC.
13
Source: Barclays, Clarksons, Commodore, USDA
§ Drybulk newbuilding vessel deliveries have totaled
 52.5m DWT YTD, +13% Y/Y.
 § Capesize representing 48% of total.
§ Australian coal production remains below pre-flooding
 levels, 30m+ MT lost.
§ Floods in the Midwest impacted transportation along
 the Mississippi River leading to force majeure, 2Q 2011
 average weekly barge shipments decreased 26% Q/Q.
§ Indian iron ore exports remain subdued due to stalled
 resumption of product out of Karnataka and the onset
 of the monsoon season, 2011 exports are expected to
 be down by 20% Y/Y to 75m MT.
§ Japanese trade impacted by tsunami, monthly coal
 imports down 16% / steel plate prices up 20%.
Deliveries and Trade Disruptions Impact 2011
Vessel Earnings Pressured
Japanese Coal Imports
(in m MT)
Japanese Steel Plate
($ / MT)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EAGLE BULK SHIPPING INC.
14
Source: Barclays, Macquarie, MS, USDA
§ Net-fleet growth to continue at elevated
 levels for the next 12+ months.
§ Resumption (pick-up) in Indian iron ore exports
 remains questionable.
§ High Chinese iron ore stockpiles along with continued
 power-usage rationing may lead to short-term
 cap on imports.
§ Chinese coal restocking has been rampant since
 hitting a low earlier in the year, Indonesian exports
 have benefited.
§ Japanese post-tsunami recovery / reconstruction to
 benefit coal, iron ore, steel products, and
 lumber.
Near-term Fundamentals for Drybulk Remain Mixed
 
 
 
 
 
EAGLE BULK SHIPPING INC.
15
Source: Clarksons, Macquarie, MAF, Potash Corp.
§ Russian grain export ban lifted in July,
 2011/2012 exports projected at 12m
 MT, +300% Y/Y.
§ Chinese soybean imports to reach 59m MT,
 +10.3% Y/Y.
§ Forest products represent approximately
 180m MT in annual drybulk trade.
 § New Zealand log exports to Japan
 expected to pick-up significantly as
 reconstruction initiates.
§ Global minor bulk trade for 2011 projected to
 reach 1.2 billion MT, +5% Y/Y.
Grain/Agricultural and Minor Bulk Trades Firm
Minor bulks represent 33% of total drybulk trade
Soybean Production and Chinese Imports
(in m MT)
New Zealand Log Exportss
(12m MT per year)
 
 
 
EAGLE BULK SHIPPING INC.
16
Source: Clarksons, Macquarie, Peabody, SSY
§ Japanese nuclear power plant disaster has led to
 Germany shutting down 8 of its plants, or 8.5 GW of
 electricity capacity.
§ Opposition to shale gas exploration is increasing, could
 lead to further demand for coal.
§ Over 250 GW of coal-fueled power capacity coming
 online globally by 2015.
§ Incremental seaborne thermal coal product over the
 next 5+ years to primarily come from Indonesia and
 Australia.
 
 § Delays in Australian capacity expansion will
 require Indonesia to make-up short-fall.
§ Global steel production expected to increase by 30% or
 400m MT by 2015, boosting demand for iron ore and
 coking coal.
Strong Long-term Demand for Coal and Iron Ore
Coal to dominate drybulk trade growth
Projected Global Steel Production
(in m MT)
4yr Projected Increase in SeaborneThermal
Coal Trade
(in m MT)
 
 
 
EAGLE BULK SHIPPING INC.
17
Source: Clarksons, ICAP, Seatrade
Slow-steaming strategy coming into play, positive for utilization
Vessel Supply Growth Curtailing
§ Drybulk newbuilding deliveries have peaked and
 the orderbook continues to shrink.
 § New orders down 80% Y/Y.
 § Orderbook, as a % of fleet,
 down 45% since 2008.
§ Slippage/cancellations running at +35%, subduing
 supply growth.
§ First half 2011 scrapping amounted to 13m DWT,
 +122% over 2010 full-year total.
 § Scrap rates remain at +$500 per LWT.
§ Rising steel plate prices and CNY appreciation
 continue to squeeze Chinese shipyards’ margins,
 providing support to newbuilding prices.
 
§ Financing remains an issue.
Drybulk Scrapping
(in m DWT)
Drybulk Newbuilding Deliveries
(3 month trailing average, in m DWT)
 
 
 
Financials
 
 
 
EAGLE BULK SHIPPING INC.
19
Earnings (in thousands, except per share data)
Three Months Ended June 30
 
2011
2010
REVENUES, net of commissions
$76,405.4
$65,612.8
OPERATING EXPENSES
 
 
 
Voyage expenses
 8,125.3
 -
 
Vessel expenses
 21,289.8
 16,052.9
 
Charter hire expenses
 11,029.8
 -
 
Depreciation and amortization
 17,640.3
 15,537.1
 
General and administrative expenses
 8,038.8
 10,479.4
 
Total operating expenses
$66,124.0
$42,069.4
OPERATING INCOME
$10,281.4
$23,543.4
OTHER EXPENSES
 
 
 
Interest expense
 11,672.4
 12,607.7
 
Interest income
 (29.4)
 (76.2)
 
Other expense
 76.7
 -
 
Total other expense, net
$11,719.7
$12,531.5
NET INCOME (LOSS)
($1,438.3)
$11,011.9
 
 
 
EBITDA*
$28,804.8
$41,669.1
EPS (Basic and Diluted)
($0.02)
$0.18
 
 
 
Weighted average shares outstanding
 
 
 
Basic
62,571,322
62,176,684
 
Diluted
62,571,322
62,337,774
 
 
 
EAGLE BULK SHIPPING INC.
20
Balance Sheet (in thousands)
Period ending June 30, 2011
 
 
 
 
 
Cash and Restricted Cash
$73,578.9
Other Current Assets
 29,327.9
Vessels, net
 1,616,579.6
Advances for vessel construction
 153,070.6
Other Assets
 23,970.7
Total Assets
$1,896,527.7
Current Liabilities
 37,444.0
Long-term Debt
 1,151,354.5
Other Liabilities
 36,730.4
Stockholder's Equity
$670,998.8
Total Liabilities and Stockholder's Equity
$1,896,527.7
 
 
 
 
 
 
EAGLE BULK SHIPPING INC.
21
Expense breakdown*
Vessel Opex
$5,103
Technical Management
319
G&A
1,307
Interest
3,300
Drydocking
603
Total
$10,632
2011 Estimated Cash Break-Even Levels
$10,632 per vessel per day cash break-even for 2011
*ASSUMPTIONS:
§ Vessel expenses are comprised of the following: crew wages and related, insurance, repair and maintenance, stores, spares and related inventory,
 tonnage taxes, newbuilding pre-operating costs (associated with taking delivery of vessels).
§ Interest expense takes into consideration Eagle Bulk’s view and projection of 3m LIBOR rates.
 
 
 
 
 
Key Takeaways
 
 
 
EAGLE BULK SHIPPING INC.
23
Key Takeaways
Supramax Asset
Class
§ Optimal size to load/discharge at most ports around the globe.
§ Onboard cranes allow for the loading/discharging of cargo without the
 requirement of onshore equipment.
§ Vessel’s versatility/flexibility yield most stable earnings in drybulk.
Eagle Bulk Fleet
§ One of the youngest, largest, and most homogeneous in the world.
Eagle Bulk
Commercial
§ Global team with presence in New York and Singapore allows for 24/7
 market coverage.
§ Opportunistic and dynamic chartering strategy.
§ Diversified approach/tools allow for capitalizing in all market cycles.
Eagle Bulk
Operations
§ Excellent fleet management track record, near-100% utilization.
§ Utilize 3 technical managers (including in-house group), allows for
 benchmarking and improved control/costs.
Eagle Bulk
Management
§ Experienced U.S.-based management team.