Page 1

APL Logistics APL Logistics

Corporate Seminar 2006Corporate Seminar 2006Corporate Seminar 2006Corporate Seminar 2006

Page 2

APL Logistics’ Core EBIT Margin TrendAPL Logistics’ Core EBIT Margin Trend

Highest margins in 4 years

Margins to 4.6% in 2005

ROCE at 11% Targeting 15% in 3 years

-5.0%

-2.5%

0.0%

2.5%

5.0%

2002 2003 2004 2005

Page 3

APL Logistics Revenue and Core EBITAPL Logistics Revenue and Core EBIT

-9-22

7

34

59

-40

-20

0

20

40

60

$(Mil)

2001 2002 2003 2004 2005

Year

Core EBIT

Core EBIT GrowthRevenue Growth

723814

975

11671290

30%

12%

20% 20%

11%

0

200

400

600

800

1000

1200

1400

2001 2002 2003 2004 2005

0%

5%

10%

15%

20%

25%

30%

35%

Revenue Growth

Page 5

IT Systems, Capabilities

and Stability

Be the Industry Leader in Quality

Logistics Solutions

Organization Change and

Roll-Out

Innovate Solutions addressing Key Supply

Chain Challenges

Innovate Solutions addressing Key Supply

Chain Challenges

Deliver Business Outcomes in’06Deliver Business Outcomes in’06

Building the Foundation in ‘06 Building the Foundation in ‘06

Differentiate Liner with Logistics as The Competitive Advantage in managing the Customers Supply Chain

Differentiate Liner with Logistics as The Competitive Advantage in managing the Customers Supply Chain

Create Value & Ensure Operational

Excellence

Consol Optimization

Product Customization

SupplierManagement

DeconsolCustoms Clearance

Port-to-PortConveyance

Customs Clearance

FreightBrokering

Final Delivery ReverseLogistics

Execute Go-To-Market

Strategy

Logistics Product Review

and Final Alignment

APL LogisticsAPL Logistics

Productivity Improvement Productivity Improvement

NOL Group Rev

Income

NOL Group Rev

Income

APLLRevenuesand EBIT

APLLRevenuesand EBIT

Redefine Logistics

Business IT Requirements

40% APLL Business on APL Assets.

50 New JointLiner/Logs Acct15 SAM Accts15 SAM Accts

Verify Customer SC Challenges to Change the Game

Verify Customer SC Challenges to Change the Game

Develop 3 new

Products in 2006

Develop 3 new

Products in 2006

KPI Alignment and value

recognition

KPI Alignment and value

recognition

Complete Vertical Study (4) Main and

Solutions Roadmap

Complete Vertical Study (4) Main and

Solutions Roadmap

Holistica to Deliver 2

Customers

Accomplish Business Priorities

within Budget

Cost Savings Targets

Cost Savings Targets

Generate Incremental

Rev

Generate Incremental

Rev

Acquire Airfreight and

DeconsolCapabilities

Develop our Talent and Expertise in the

Logistics Organization

Creating and Sustaining Competitive Advantage

Page 6

IndustryLeadership in

Quality Solutions

Differentiate Liner – Develop the Premium

Innovate Solutions

Innovate -Develop New Products and Services (Int’l Service Focus) Develop Industry Vertical Customer Specific Solutions Create and Implement New Pricing Strategies Value Add to Liner Offerings with Logistics Capabilities

Achieve Low Service Time Variability - Predictability Shorter Transit Times E2E - Velocity Real Time Information - Visibility Integrated Offerings to Enhance Control & Simplicity - Flexibility

Value & Operational Excellence

Financial Performance for the Group Value to Customer Supply Chain Stronger analytical capabilities Reporting Next generation IT platform

Create Sustainable Advantage

Page 7

Brian LuttPresident

APL Logistics

RegionalLogistics Leads

Jim McAdamSVP

Supply ChainSolutions

Bill Villalon**VP

Global Marketingand ProductDevelopment

Danny Goh**VP

Global Operationsand IT Strategy

Rosario Rizzo**VP Logistics

Americas Region

Eddy WoutersVP Logistics

Europe Region

Paul TayVP Logistics

G. China Region

Gene SerokaVP LogisticsAME Region

Products &Custoomer Verticals

Danny Goh**Global CNS/DNS

Steen MarcuslundGlobal Forw arding

Rosario Rizzo**CLS/WMS

Mike PilverAuto/AutoIMS

** Denotes Multiple Roles/Assignments

Bill VillalonIntermodal & Vascor

Building the Foundation in ‘06

Organization Change and

Roll-Out

Page 8

Building the Foundation in ‘06

Organization Change and

Roll-Out

Brian LuttPresident

APL Logistics

Regional*Logistics Leads

Rosario Rizzo**VP Logistics

Americas Region

Eddy WoutersVP Logistics

Europe Region

Paul TayVP Logistics

G. China Region

Gene SerokaVP LogisticsAME Region

** Denotes Multiple Roles/Assignments

NOL Regional Presidents

Page 9

Building the Foundation in ‘06

Organization Change and

Roll-Out

Bill Villalon**VP

Global Marketing &Product

Development

SteenMarcuslund

FreightProcurement

Air/Sea

Danny GohConsol/DeconsolGlobal Product

Lead

Rosario RizzoWMS/ClS

Global ProductLead

Mike PilverAuto Vertical

Lead

R&D Team/Product Development

Global Product Leads w ill have mutiple roles in theorganization.

Vertical Leadsand Industry

Experts

Page 10

Building the Foundation in ‘06

Organization Change and

Roll-Out

Regional Changes and Organizations have been rolled out as of February 1st.

Page 11

Building the Foundation - Talent

Develop our Talent and Expertise in the

Logistics Organization

Training

• We must train our teams to Sell All Services• We must train our teams to Add Value• We must train our teams to sell Value Added• We must train our teams to X-Sell• We must Integrate our Sell

Develop Expertise

• We must understand our customers’ Supply Chain Challenges• We must develop vertical expertise and address those Challenges• We must innovate with solutions for selective verticals and customers• We must Challenge ourselves to Get Ahead of The Customers Curve•

Page 12

Liner and Logistics – Go To Market

1. The Coordinated APL/APLL Sell

Target list of customers to cross sell APL and APLL products/servicesList to be developed collaboratively between APL/APLL at the District LevelTo Be Completed By March 17th.

APL/APLL Then Goes to MarketAPL/APLL Then Goes to Market2. The Combined Sell

Target List of Customers to sell Combined (Bundled Services) APLL Invoiced on APL Liner Assets. List to be developed same as aboveTo Be Completed By March 17th

APL/APLL Then Goes to MarketAPL/APLL Then Goes to Market

3. LCL – Standard Product Re-launch

Target list of customers to re-sell on APLL/APL LCL Service List to be developed from both origin and destinations (TP Product Only for Now)To Be Completed by March 17th…..Re-Launch Scheduled for April 1st

APL/APLL Then Goes to MarketAPL/APLL Then Goes to Market

4. Focused Expansion and Growth Sell

IFS to sell into new markets and Geographies in advance of Liner Network CapabilitiesAPLL is selling today – Generate Leads from APL Liner Customers

5. Spot Utilization and IFS Growth Sell

APLL Has Gone to MarketAPLL Has Gone to Market

Target non-APL Liner customers to grow APLL IFS business profitably. This business would be utilized as “spot” filler for APL in the event of cargo shortfalls.Rules of Engagement are in Place.APLL Has Gone to MarketAPLL Has Gone to Market

Page 13

IT Systems Capabilities and Innovation

New Capabilities

FutureRequirements

GFF – MU3 in Pilot Yantra – New WMS Platform 2006 eDoc – Coming in 2006

Vendor DeskTop – Needed to play in the Consol Space Intermodal Agent System Driving IT Strategy from within the Business Vertical Solutions – Cutting Edge Technology

Innovation Business involvement in driving IT Strategy We will need to invest in our IT Future Continuous IT Improvement as a differentiator The customer needs to be “Wow’d”

Working the Opportunities

Page 14

2006 Logistics KPI’s

Phase in Strategic Account Management Program

15 Accounts in 2006

Joint Liner/Logistics Customer Targets – Incremental Revenue 2006

Decide on Verticals, Strategies, Capabilities and Structures

By end 2nd Quarter

Develop Vertical Capabilities and Expertise

Build a Solid Customer Pipeline in each Vertical

Execute Liner/Logistics Go-To-Market Strategy

Differentiate Liner with Logistics as a competitive advantage

Improve Cross Shares %

Review and Refine our Business/Product Strategies

Page 15

2006 Must Do’s

Leveraging our capabilities across lines of business – Coordinate and Execute Strategy

Customers - Logistics to Liner and Liner to Logistics

Operations – Transportation, Facilities and Back Room Functions

Total Commitment to Integration – “We have not yet got this right”

Develop Business Model around Logistics Engineering Product

Controlling and reducing Costs

Managing the Business with Regional Focus – P&L Accountability

Build The Regional Pipeline - Accelerate Sales Training & Integrate