Investor Release Year End 2014 - Global Ports Holding
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Investor Release
Year End 2014
April 2015 | Strictly Private and Confidential
1Organisational Structure
100.0%
Public
Others3
Shareholders2
35.5% 40.0% 38.0% 27.49%1
99.9%1 64.5% 60.0% 62.0% 72.5%1
Ortadoğu Antalya Bodrum Liman Ege Liman
Liman İşletmeleri A.Ş. Container Terminal and İşletmeleri A.Ş. Barcelona Port İşletmeleri A.Ş.
General Cargo JSC-Bar Investments S.L.
(Port Akdeniz-Antalya)4 (Bodrum Cruise Port) (Ege Ports-Kusadasi)
100.0% 100.0%
Creuers del Port de
Port of Adria-Bar Barcelona S.A.
(Barcelona Cruise Port)
SATS5
80.0% 60.0% 40.0% 10.0% 20.0% 30.0% 40.0%
SATS-Creuers Cruise Lisbon Cruise Accounted for
Cruceros Málaga S.A.
Services Pte. Ltd. Terminals LDA Using Equity
(Malaga Cruise Port) (Singapore Cruise Port) Pickup Method
(Lisbon Cruise Port)
GPH Effective GPH Effective GPH Effective
Cruise Port Commercial Port 49.6% 24.8% 46.2%
Source: Company information.
1. Türkiye Denizcilik İşletmeleri holds 1 share in Ortadoğu Antalya Liman İşletmeleri A.Ş. and Ege Liman İşletmeleri A.Ş.
2. 35.5% of Container Terminal General Cargo JSC-Bar is listed on the Montenegro Stock Exchange and publicly held.
3. Yüksel Çağlar (a Turkish businessman and entrepreneur) holds 30% of the shares in Bodrum Liman and Setur (duty-free operator owned by the Koç Group of Turkey) holds 10%.
4. Port Akdeniz-Antalya also has cruise operations.
5. A subsidiary of TEMASEK.
2Company History
GPH-RCCL acquired remaining stake in Creuers
GPH established
Acquired a – GPH stake: 62%, RCCL stake: 38%
(commenced Signed concession agreement for Lisbon cruise port (GPH’s effective
60% stake in
operations at stake: 46.2%)
Bodrum cruise
Kusadasi cruise port US$250m debut bond issuance
port Formed consortium with Bouygues for Dubrovnik cruise port tender
in 2003)
(consortium pre-qualified as sole bidder in early 2015)
3
2014 111
2013
2010
2008
2006
Acquired a 62% stake in Adria-Bar
2004
commercial port
Acquired a minority stake in
Acquired the remaining
Acquired a 40% stake Creuers (Barcelona, Malaga and
59.8% stake in Akdeniz-
1 in Akdeniz-Antalya Singapore cruise ports) in
5
Antalya commercial port
commercial port partnership with RCCL
2004 Revenue ($ mm) 2014PF Revenue ($ mm)
2004: 2006: 2010: 2014PF:
Pax: 274,805 Pax: 424,949 Pax: 793,158 Pax: 3,938,5762
Cargo: 1.0m tons Cargo: 3.1mm tons Cargo: 1.9mm tons
Throughput:53,663 TEU Throughput: 125,670 TEU Throughput: 228,382 TEU
Domestic Growth International Growth
1. Turkish GAAP.
2. Includes Singapore and Lisbon.
3 3. Unaudited pro forma for full year effect of Creuers acquisition. Pro Forma financials are based on GPH audited financial statements and Creuers unaudited financial statements for 2014.Introduction to Global Ports Holding
GPH is the world’s largest cruise port operator with an established presence in the Mediterranean and Asia-Pacific
regions, including extensive commercial port operations in Turkey and Montenegro.
Global Ports Holding is a leading port operator with a diversified portfolio of cruise and commercial ports in Turkey, the Mediterranean and Singapore
– GPH is the world's largest cruise port operator
• Following its recent acquisition of leading Spanish cruise port operator Creuers, GPH now operates a portfolio of 6 cruise and 2 commercial ports1 in 5 countries
• As the world’s sole and the largest cruise ports consolidator, GPH plans to continue its expansion in the global cruise port sector
– Pro-Forma for the acquisition of Creuers, 2014 revenue stood at US$111m and consolidated EBITDA at US$70m2,3
– 100% owned by Global Investment Holdings, a diversified investment holding company based in Turkey
• GPH was established in 2004 to participate in upcoming Turkey privatizations in the port sector
Cruise Port Activities
Commercial Port Activities
Serving cruise liners, ferries, yachts and mega-yachts
Specializing in container, bulk and general cargo handling
Creuers Ports
Kuşadası Bodrum Barcelona
1
Antalya Bar
Lisbon Singapore Malaga
43%
1 2014PF Segmental
EBITDA 57%
Antalya 2,3 of US$73m2,3
US$32m
US$42m2,3
1. Port Akdeniz-Antalya, while predominantly a commercial port, also has cruise operations (representing approximately 4% of the port’s 2014 revenue).
2. US$70m is the pro-forma consolidated EBITDA and US$73m is the pro-forma segmental EBITDA (please refer to page 66 for EBITDA reconciliation). Segmental EBITDA for cruise includes EBITDA of
all pure cruise ports as well as cruise portion of Port Akdeniz’s EBITDA (in order to split Port Akdeniz EBITDA between cruise and commercial, the total EBITDA of the port is split pro-rata revenue).
4 3. Unaudited pro forma for full year effect of Creuers acquisition. Pro Forma financials are based on GPH audited financial statements and Creuers unaudited financial statements for 2014.Port Network Overview
GPH has a diversified and strategically located asset portfolio, forming the world’s largest cruise port network.
Creuers Ports
Mediterranean & Turkey
A B
Bodrum Cruise Port Málaga Cruise Port
Cruise, ferry and mega-yacht port located on Concession of the three cruise terminals of
Turkey's Aegean coast, near one of Turkey's Port of Malaga; main activity is boarding,
most popular seaside resorts unloading & billing of passengers, and
Pax 2014A: 123,549 luggage management
D Revenue 2014A: $2.8m Pax 2014A: 406,563
Barcelona Cruise Port End of concession: 2019 Revenue 2014A: $3.0m 3
End of concession: 20444
C D
Ege Ports-Kuşadası Barcelona Cruise Port
Busiest cruise port in Turkey, located near One of the largest cruise homeports; operates
Ephesus, a major tourist attraction and the 5 cruise terminals of the Port of Barcelona (4
House of the Blessed Virgin Mary as a concessionaire)
H
Port of Adria-Bar Pax 2014A: 622,184 Pax 2014A: 1,587,469
E Revenue 2014A: $16.3m Revenue 2014A: $22.6m3
Lisbon Cruise Port End of concession: 2033 End of concession: 2026 (WTC wharf), 2033 4
(Adossat wharf)
E F
G Lisbon Cruise Port Singapore Cruise Port
Port Akdeniz-Antalya1
Port of call for cruises; operates three cruise Main activity is the operation of Terminal
terminals and a new terminal is expected to Marina Bay Cruise Centre in Singapore
be completed in 2016 PAX 2014A: 344,391
Pax 2014A: 500,872 Revenue 2014A: $7.5m3
B End of concession: 2049
C End of concession: 2022 (applied for 5-year
Málaga Cruise Port
Ege Ports-Kuşadası extension, with high likelihood of approval)
Singapore G H
Port Akdeniz-Antalya1 Port of Adria-Bar
A
Bodrum Cruise Port High capacity commercial port with a General and container cargo, as well as
dominant position in export traffic for its special purpose warehouse services
hinterland, also active in cruise operations Cargo 2014A: 0.8m tons2
F
Singapore Cruise Port Cargo 2014A: 4.4m tons2 Revenue 2014A: $9.6m
Cruise Ports Commercial Ports PAX 2014A: 350,548 End of concession: 2043
Revenue 2014A: $56.6m
End of concession: 2028
1. Port Akdeniz-Antalya also has minor cruise operations.
2. Metric tons. Includes contribution from container handling, converted from TEU to tons at a ratio of 1:14.38.
3. Full year 2014. Singapore Fiscal Year ends in March.
5
4. Assumes automatic extensions.Financial Snapshot (1)
Revenue Development 2014 Segmental Commentary
US$mn
2
Drop in container volume, due to slowdown of
111 Port Akdeniz-Antalya
Chinese property market in 2014, balanced by
– Commercial
increase in container yield
Commercial
91 26 Increase in TEU by marketing efforts despite
Port of Adria-Bar
capex program not finalised
6
3 3
75 Mainly homeport operations, new cruise lines
3 16 16 Port Akdeniz-Antalya
68 calls with larger ships had a positive effect on
– Cruise
3 the revenues
16 2 2
16 9 9 NCL’s shift from Izmir with 70K pax in 2014
2 Ege Ports compensated for the temporary deployment of
2 Med vessels to Asia
Cruise
Cunard, Louis Cruise Lines and Noble
Bodrum Cruise Ports Caledonia added Bodrum to their itinerary in
54 54 54 2014
47
Largest cruise port in Europe was partially
Creuers resilient to shift in the market to Asia. Strong
recovery in late 2014 and eraly 2015.
Note: Lisbon and Singapore not included as accounted for via equity pick up method.
2012 2013 2014 2014PF
Currency Mix 2014 General Commentary
% Revenue
Recent growth driven by acquisitions in cruise sector Creuers-Port of Barcelona and Malaga
Cruise, and Port of Adria- Bar Ports. Lisbon Cruise Port is not fully consolidated.
GPH’s Turkish Ports revenues are USD based, benefiting from the 8.6% depreciation of the TL
during the period.
Consolidated port revenues reached US$91mn at the end of 2014, whereas, consolidated pro-
forma revenues reached US$111mn for 2014, representing 48% increase over 2013.
Revenues have also been positively affected by tariff increases in both commercial and cruise
USD EUR operations.
1. Revenue allocated to cruise segment includes sum of revenues of cruise ports as well as cruise portion of revenue from Port Akdeniz, which while mainly a commercial port also has minor cruise
operations.
2. Unaudited pro forma for full year effect of Creuers acquisition. Pro Forma financials are based on GPH audited financial statements and Creuers unaudited financial statements for 2014.
6Financial Snapshot (2)
Performance Development 2014 Commentary
1
2012 2013 2 2014 2 2014PF 2014 pro-forma EBITDA was reported as US$73mn, excluding the US$24mn in negative
goodwill gain from the acquisition of Creuers, and one off project expenses related to various
Segmental acquisitions and capital markets transaction.
EBITDA
2014 IFRS EBITDA was US$62mn (excluding goodwill gains and non-recurring project
US$mn 73
62 expenses) as compared to 2013 EBITDA of US$53mn (excluding goodwill gains), which
45 53
42 represents an improvement of 17% y-o-y.
38 42
30 2014 IFRS financials indicates and increase of 25% in cruise EBITDA as compared to the
15 16 20 32
same period in 2013. Of that increase, US$4.5mn is attributable to acquisition of Creuers (only
Q3 financials of Creuers were consolidated during 2014).
Cruise Commercial As per the 2014 pro-forma financials, the cruise segment EBITDA grew by 100%, owing nearly
73
all of the growth to the full year consolidation effect of Creuers.
Segmental
EBITDA The 11% increase on the commercial segment EBITDA is mainly due to the addition of Port of
Margin 62 Adria-Bar in to the portfolio, contribution 7% of the increase.
US$mn The EBITDA margins in cargo business were suppressed from 70% levels to 65% by impact of
53 the lower margins recorded at Port of Adria-Bar, at around 28% in 2014. Nevertheless, this
75% 42
70%
73% represents an improvement from negative margins at the time of the take-over, which will
45 67% continue to significantly recover.
65%
70%
42
The cruise margins are also effected by the inclusion of Creuers into the portfolio with its lower
65%
64%
margin at 62%, yet to be improved with the additional measures to be introduced on the retail
38 and efficiency fronts.
30
Creuers
EBITDA by Port 22% Kuşadası Port
17%
32
Total: US$73.2m
20
15 16 Port of Adria
4%
2012 2013 2014 2014PF
Cruise Commercial
Bodrum Port
Cruise % Margin Commercial % Margin
2% Antalya Port
55%
1. Unaudited pro forma for full year effect of Creuers acquisition. Pro Forma financials are based on GPH audited financial statements and Creuers unaudited financial statements for 2014.
2. 2013, 2014 and 2014PF excluding from Global Ports Holding solo expenses. EBITDA figures indicate only operational companies.
7KPI Snapshot (1)
Strong growth primarily driven by the acquisition
Performance Development (Cruise) of controlling stake in Creuers on 30 September
2014.
1 Creuers-Barcelona is the busiest homeport in
2012 2013 2014 2014PF
Europe.
Around 62% of passengers at Creuers are
turnaround passengers.
Passengers 3,939 Due to the to luggage services provided to
(’000 PAX) turnaround passengers, the charges to those
passengers are around 4 times more than transit
1,609 passengers.
921 931
Major American oriented lines’ changing
deployment plans to Asia negatively affected non
marquee ports such as Malaga more than the
others in 2014.
Ege Ports; major cruise lines moved their larger Bodrum Cruise Ports; Since the pier extension in Port Akdeniz; T/A calls of Aida and TUI
ships from Mediterranean to Asia in 2014. In 2011 Bodrum started to welcome larger ships. increases.
2015, larger ships are deployed and accelerating The number of smaller ship calls decrease Antalya receives less calls with larger ships which
the recovery. whereas larger ship calls increase. results with slightly decrease in per pax revenue.
Norwegian Cruise Lines (NCL) move to Kuşadası Cunard, Louis Cruise Lines and Noble Caledonia Aida, generating 85% of all passengers, has a
from Izmir had a positive impact in 2014. added Bodrum to their itinerary in 2014. special discount. The increasing calls of Aida
decreases the per pax revenue.
EBITDA and % Margin EBITDA and % Margin
EBITDA and % Margin
12.1 12.6 12.7 1.6 1.6
1.4 1.3 1.4 1.2
73.4% 76.8% 78.0% 69.9% 71.6%
63.7%
52.8% 53.0% 49.9%
2012 2013 2014 2012 2013 2014 2012 2013 2014
1. Unaudited pro forma for full year effect of Creuers acquisition. Pro Forma financials are based on GPH audited financial statements and Creuers unaudited financial statements for 2014.
8KPI Snapshot (2)
Performance Development (Commercial)
2
2012 2013 2014 2014PF
In 2014, dry bulk cargo volumes and general cargo volumes
increased by 6% and10% , respectively, as compared to the same
Cargo period of the previous year.
(‘000 tons1)
5,081 4,854 5,158 5,158
Port of Antalya;
Drop in containers due to slowdown of Chinese property market in
2014.
Revenue loss due to the volume decrease is compensated by higher
margins in containers business(i.e. ancillary services to containers,
increase in imports).
Throughput 228 228
(’000 TEU) 217 Increase in the container yields are mainly due to the utilization of
186
more services for each container and also increase in the tariff.
Due to the slower than expected recovery in Middle Eastern
markets, cement factories concentrated in local markets, hence the
drop in bulk and exports.
Container Revenue/ per TEU
Constant increase in unit container yield by a combination of
148,0 162,4 171,0 171,0
changing the mix of products, better import/ export balance, tariff
increases and add-on services.
2012 2013 2014 2014PF
General Cargo Revenue/ per Tonnes Port of Bar;
5,6 8,0 8,0
Commercial 4,4 Container yields at c. US$126 are 43% lower than those achived at
Port Port of Antalya (US$180/TEU), bringing the weighted average yield
Revenues 2012 2013 2014 2014PF to US$171/TEU.
Bulk Cargo Revenue/per Tonnes Add-on services will be introduced post completion of capex
5,1 6,8 6,8 program.
3,5
Healthy general cargo unit revenue due to mix of cargo.
2012 2013 2014 2014PF
1. Metric tons. Includes contribution from container handling, converted from TEU to tons at a ratio of 1:14.38
2. Unaudited pro forma for full year effect of Creuers acquisition. Pro Forma financials are based on GPH audited financial statements and Creuers unaudited financial statements for 2014.
9Capex and Net Working Capital
Capex Profile Change in Net Working Capital
(US$mn) (US$mn)
Purchase of handling Pier improvement at Ege Payment of pavement
equipment at Akdeniz and Bodrum improvements at Akdeniz
5
TUG boat in Ege due to
regulatory requirement
13
7
(3)
4
(5)
2012 2013 2014 2012 2013 2014
All of the capex are business driven Low working capital requirement in international ports
Low-to-minimal maintenance capex for cruise business Turkish ports have negative working capital, due to pre-payment of services
Overall, moderate working capital requirements
64Historical Financials
For the year ended Decem ber 31,
2011 2012 2013 2014
Consolidated statem ent of com prehensive incom e data (USD
m illions)
Operating expenses:
Revenue 64,8 68,3 75,5 90,6 The Group’s total operating costs increased by USD 15.3 million, or
Operating expenses (39,0) (40,0) (41,0) (56,3) 37.3%, in 2014. The consolidation of the Port of Adria-Bar and Creuers
Depreciation and amortization 23,0 23,4 23,6 28,1 into the Group resulted in an increase of USD 8.5 million and USD 5.6
Other operating income 1,7 0,1 27,9 6,6 million in the cost of sales in 2014 respectively
Other operating expense (14,0) (7,0) (8,0) (17,5)
Operating profit 13,5 21,4 54,4 23,5 Other operating income:
Finance income 7,8 12,6 13,1 37,5 The decrease was primarily due to gain on bargain purchase, which for
Finance expenses (12,0) (13,0) (21,0) (54,3) the Group's acquisition in 2013 (Port of Adria-Bar) amounting US$27.7mn
Profit before incom e tax 9,4 20,9 46,9 26,0 was recorded as other income, but due to reclassification only US$6mn
Income tax expense (5,0) (2,0) (2,6) (2,0)
was recorded under this item and the balance as share of profit of equity
accounted investees item
Profit for the year 4,8 18,9 44,3 24,1
Other financial data (USD m illions actual)
Other operating expenses:
EBITDA (based on covenant definition of EBITDA) 38,2 45,1 50,4 58,8
This item is composed of selling and marketing, general and
EBITDA margin 59,0% 66,0% 67,0% 65,0%
administrative and other expenses.
For the year ended Decem ber 31, Largest portion of the increase amounting to US$7.1mn is mainly related
2011 2012 2013 2014 to new project development and consultancy services received in
Consolidated cash flow statem ent data (USD m illions) connection with the bond issue in 2014
Net cash provided by operating activities 53,0 43,0 44,0 63,0
of w hich net w orking capital 1,0 (1.0) (10.0) (3,0)
Finance Income:
Finance income mainly relates to the foreign exchange gains. The Group
Net cash used in investing activities (23.0) (1.0) (46.0) (10,0)
had net foreign exchange gains of US$32.7mn in 2014, primarily due to
Net cash used in financing activities (8.0) (44.0) 37,0 (23,0)
the appreciation of US$ and Euro against Turkish Lira
of w hich net cash dividends paid / received (1.0) (21.0) (3.7) (13,4)
.
For the year ended Decem ber 31, Finance expenses:
2011 2012 2013 2014 The foreign exchange loss of the company amounted to US$31.5mn.
Consolidated statem ent of financial position data (USD m illions) Additionally the interest expense of the Company increased by
Cash and cash equivalents * 19,9 12,5 20,0 46,4 US$13.3mn, mainly driven by the issuance of the 2014 Bond and €60mn
Total current assets 42,5 35,8 57,2 128,2 acquisition financing (non-recourse debt) at Creuers.
Total assets 417,7 391,6 479,6 707,5
Total debt (including obligations under financing leases) 81,7 65,3 190,5 336,9 Consolidated statement of financial position:
** The Group’s net cash and cash equivalents increased by 132% from
Net debt (including obligations under financing leases) 61,8 52,8 170,5 290,4
Total equity 264,7 253,2 207,9 240,2 2013 to 2014, this was primarily due to excess cash reserve after
of w hich retained earnings 147,8 145,4 145,3 146,2 refinancing of the bank loans amounting $215 million with the 2014
Bonds amounting US$250mn.
(*) includes time deposit with maturity of 6-12 months, reclassed to s/ t financial investment according to IFRS.
(**) does not include the cash deposited in Short-term investments of US$13.7mn accounted under Total Current Assets
10Capital Structure
Includes Creuers acquisition debt
Borrowings attributable to minorites (38%) Net Debt
($m) ($m)
Outstanding
Interest Am ount
1
Loan Type Currency Maturity Type Interest Rate (USDm ) At 31 Decem ber 2014
Loans Used to Finance Investm ents and Projects Loans and Borrow ings 330,3
Eurobond USD 2021 Fixed 8,1% 252,6 Finance Lease Obligations 6,6
Secured Loan USD 2016 Fixed 7,8% 0,4 Total Debt 336,9
Secured Loan TL 2015 Fixed 11,8% 0,0 Cash 46,4
Secured Loan EUR 2022 Floating EURIBOR + 4 62,5 Investments 13,7
Secured Loan EUR 2025 Floating EURIBOR + 1,75 8,9 Net Debt 276,7
Secured Loan Port of Adria-Bar 2015 Floating EURIBOR + 6,2 0,5
Secured Loan Port of Adria-Bar 2017 Fixed 7,8% 0,5 2014PF EBITDA 70,1
Total Finance and Investing Borrow ings 325,4
Loans Used to Finance Working Capital Credit Metrics 2
Unsecured Loan TL 2015 Fixed 11,0% 0,6 Total Debt / 2014PF EBITDA 4,8x
Unsecured Loan USD 2015 Fixed 6,3% 1,0 Net Debt / 2014PF EBITDA 3,9x
Secured Loan EUR 2023 Floating EURIBOR + 4 2,9
Secured Loan EUR 2017 Fixed 7,6% 0,4
Total Working Capital Borrow ings 4,9
Finance Lease Obligations
Leasing USD 2015 Fixed 5,9% 0,3
Leasing USD 2017 Fixed 5,8% 0,2
Leasing USD 2020 Fixed 7,4% 1,7
Leasing USD 2019 Fixed 7,4% 0,4
Leasing USD 2019 Fixed 7,4% 0,0
Leasing EUR 2020 Fixed 7,8% 3,8
Leasing USD 2017 Fixed 6,5% 0,1
Leasing USD 2017 Fixed 5,8% 0,0
Leasing USD 2017 Fixed 6,0% 0,1
Total 6,6
1. Includes accrued interest per IFRS.
2. Leverage covenant of the GPH Eurobond is calculated excluding EBITDA and gross debt from Malaga, which is
11 a Unrestricted Subsidiary. Bond leverage covenant is 4.7x for 31.12.2014.Exchange rates used
TL/US$ rates
Year ended
Average 1 Period end2
December 31
2014 2,1865 2,3189
2013 1,9013 2,1343
2012 1,7925 1,7826
2011 1,6701 1,9065
2010 1,5004 1,546
1. Represents the yearly averages of the monthly averages of the TL/US$ exchange rates determined by the Central Bank of Turkey for the relevant period, such monthly averages
were computed by calculating the average of the daily TL/US$ exchange rates on the business days of each month during the relevant period.
2. Represents the TL/US$ exchange rates for the purchase of US dollars determined by the Central Bank of Turkey on the last working day of the relevant period.
12Major Developments
Dubrovnik Cruise Port Tender:
In December 2014, GPH submitted the pre-qualification application for the Dubrovnik Gruz Port tender through its Croatian subsidiary, International Cruise Port Investment
d.o.o., in partnership with French based BOUYGUES BATIMENT INTERNATIONAL (BBI). As of February 02, 2015, GPH announced that its pre-qualification application
was the only one to be approved for the tender.
The tender for Dubrovnik Gruz port includes the construction and 40 years operating rights of a cruise terminal, central parking lot, administration building, and a bus station
in the city of Dubrovnik, one of the most prominent tourist destinations in the Mediterranean.
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