1. Presentation November 23 2004
STAR Reefers
Presentation
November

2. Reefer Market Caracteristics
Commodities in specialised reefers over 300,000 cbft
Bananas
Decidious
Citrus
South north lanes
Sesonal business
Low value
High Volum
Low draft
Small vessels
Loading in ports with limited infrastructure
Vessels have Cranes
The Forgotten Segment
Presentation 23 November

3. Conventional reefer landscape
Source: Drewry
Presentation 23 November

4. Trade patterns (Banana trade)
Source: UN
Trade patterns (Banana trade)
Presentation 23 November

5. Recent Reefer Industry Developments
Market growth expected to exceed 2,5% p.a.
Significant increase in spot rates
Customers concerned about availability of tonnage
Fruit major securing tonnage on 3 year contract
Aggressive competition amongst operators
Operators chartering in vessels on medium term (3 – 5 years)
Container lines concentrated on dry cargo
Competition for quality 2nd hand ships
Scrapping continuing in strong market
Old fleet
Almost no new orders
Star well positioned to take advantage of this period of change
Presentation 23 November

6. Conventional reefer landscape
MAJOR REEFER OPERATORS (Post split)
Source: Star
Source: Drewry
Presentation 23 November

7. 2004 With 2nd Peak in May and a Strong Summer and Fall Market
Presentation 23 November

8. 2004 With 2nd Peak in May and a Strong Summer and Fall Market
Presentation 23 November

9. Are Rates Returning to 1997 Levels?
Presentation 23 November

10. Factors influencing demand
Consumer expenditures and general economic conditions
A Theoretical Approach A B C
GDP per capita
Consumption pr. capita 2 4 6 8 10 12 14
Russia
1930
Saudi
Arabia
6870
Germany
25280
USA
25820
Other
E. Eur.
2355
W. Eur.1)
25927 EU
19755
A) Low income, basic need coverage
B) Rising income changing spending (eating) habit. Economy in focus by multinationals (Distribution network/promotion).
C) Consumption reaches top point. Rising income triggers substitution to more sophisticated fruits
Presentation 23 November

11. Strategic matrix – Reefers vs containers
SOUTH – NORTH LANE
SPEED ADVANTAGE
PORT TO PORT
LOW DRAFT
GEAR
HIGH AVERAGE AGE
QUALITY PAYS
NO ORDER BOOK
HIGH VOLUME – LOW VALUE
BANANA TRADE
CHANGE OF BANANA REGIME 06
WEAK SERVICE & CHAIN MANAGEMENT
CONTAINERS
EAST – WEST LANE
SPEED IMPROVEMENTS TO COME
TERMINAL TO TERMINAL / DOOR TO DOOR
DRAFT LIMITATIONS
NO GEAR
LOW AVERAGE AGE
ESTABLISHED QUALITY
HIGH ORDER BOOK IN 3000 TEU RANGE
LOW VOLUME – HIGH VALUE
NO BANANA TRADE EXCEPT FOR BRAZIL/USWC
NO IMPACT TO THE CONTAINER
STRONGER LOGISTICAL BASE
Presentation 23 November

12. Net Scrapping Continues in a Strong Market...
...but most of it is the older frozen vessels.
Source Orion Shipping
Presentation 23 November

13. Reefer Age Distribution Fleet over 300 000 cbft 231 mill. cbft.
39% of fleet is over 20 years and almost no newbuildings
Presentation 23 November

14. Presentation 23 November
Star Strategy
Objective
Strategy
To generate a RoE better than our major competitors
Simplify and improve the management of the Company
Optimise fleet structure
Business risk management
Reduce costs
To evaluate new reefer shipping and terminal opportunities.
Presentation 23 November

15. Presentation 23 November
STAR Core Fleet .
Presentation 23 November

16. Reefer Age Distribution of Fleet over 300 000 cbft (231 mill)
# Ship Star Owned/BB
# Ships Star Chartered
Presentation 23 November

17. STAR Reefers Highlights in 3Q
EPS $ 0.48 against $ last year
Freight rates 49 cents in 2Q vs. 39 cents last year
Sale of 2 ships generating profit of $ 4.6 million
Contract renewals 2005 at levels up 15-25%
Strenghening balance sheet
Presentation 23 November

18. Presentation 23 November
Profit & Loss Account .
Presentation 23 November

19. Presentation 23 November
Balance Sheet .
Presentation 23 November

20. STAR Reefers Recent Developments
Time Charters for 2 newbuildings
Vessels to be built at Shikoku Yard in Japan
Delivery Q and Q4 2006
Specialised Reefers of 585,000 cbft.
High Speed
High containerintake
Low bunker consumption
10 year duration of charters
STAR secruing modern long term tonnage as a leading quality reefer operator
Presentation 23 November