Himalaya Shipping Ltd. · OSL:HSHP
Himalaya Shipping — Q3 2023 Earnings Presentation
16 slides from Himalaya Shipping's earnings presentation, Nov 15, 2023
Slide 1: Himalaya Shipping – Q3 2023 results presentation
1 Himalaya Shipping – Q3 2023 results presentation 15 November 2023
Slide 2: Forward looking statements
2 Forward looking statements This results presentation and any related discussions contain forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are statements that do not reflect historical facts and may be identified by words such a
Slide 3: Highlights
3 Highlights Q3 2023 Highlights: • Successful delivery and commencement of operations of an additional two Newcastlemax dual fuel newbuildings. • All delivered vessels generated total operating revenues of $10.2 million, an average time charter equivalent earnings of approximately US$22,300/day, gro
Slide 4: Key Financials Q3 2023 – Income statement
4 Key Financials Q3 2023 Income statement Comments Q3 2023US$ millions, except per share data 10.2 Operating revenues (3.0)Vessel operating expenses (0.2) Voyage expenses and commission (0.9) General and administrative expenses (3.2) Depreciation and amortization (7.3) Total operating expenses 2.9Op
Slide 5: Key Financials Q3 2023 – Balance Sheet Summary
5 Key Financials Q3 2023 Balance Sheet Summary Comments June 30, 2023September 30, 2023US$ millions 459.8560.4Total assets 134.4132.6Total equity 24.212.8Cash and cash equivalents 286.8432.3Vessels and equipment 143.6108.8Newbuildings 305.9421.9Short-term and long-term debt • Net cash generated by o
Slide 6: Strong growth in dry bulk demand
6 6 Jan-Sep yoy change in tonne-miles by segment and commodity Million tonne-miles Strong growth in dry bulk demand Source: AXSDry, Arrow
Slide 7: Capesize market fundamentals should see more support going forward
7 Capesize market fundamentals should see more support going forward Iron ore port stocks in China Fixed asset investment growth in China Source: Clarksons Shipping Intelligence Network (https://sin.clarksons.net/) Chinese bauxite imports Chinese demand - iron ore restocking need, strong bauxite dem
Slide 8: A significant reduction in Capesize congestion has put pressure on freight rates
8 A significant reduction in Capesize congestion has put pressure on freight rates Congestion YTD. 2023 Average speed YTD. 2023 Source: Clarksons Shipping Intelligence Network (https://sin.clarksons.net/) Decreases in speed have not been enough to counterweight the drop in congestion
Slide 9: Utilization vs. stationary fleet
9 Utilization vs. stationary fleet Capesize freight rates have been very sensitive to a drop in congestion IF stationary fleet in Q3.23=Q2.23, then Capesize freight rates would theoretically be 50% higher and average at 19.000 $/day, instead of 12.500 $/day. IF stationary fleet in Q3.23=Q3.22, then
Slide 10: The investment case
10 The investment case
Slide 11: The right timing: 25 year low orderbook
11 0 50 100 150 200 250 300 350 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 Ac tiv e Sh ip ya rd s, T ot al No. Active Shipyards, Global 20,000+ dwt The right timing 25 year low orderbook at 5% Significant reduction in yard capacity Source: Clarksons Shipping Intelligence Network (https://sin.
Slide 12: The right timing: older vessels at risk
12 Vessels built post-2016 unaffected by 20303 Vessels built between 2009 and 20153Vessels built before 20093 680 ships – 33%1,072 ships – 52%313 ships – 15% The right timing 1. Capesize including sub-categories Newcastlemax and VLOC 2. Capesize fleet defined as all vessels delivered since 1996 unti
Slide 13: The right ships: 43% more CO2 efficient
13 The right ships 43% more CO2 efficient than a standard Capesize1 1. When running on LNG, basis 43 mT pr day fuel consumption and 3.2 CO2 pr mT for a 180k dwt 2014/15 built Capesize vessel and 28 mT pr day fuel consumption and 2.8 CO2 pr mT for a Himalaya newbuild. Source: Bloomberg and Company es
Slide 14: The right ships: fuel flexibility unlocking premium potential
14 1. 2022 average of the 5 T/C Routes for Baltic Capesize Index of $16,177. 2. Scrubber benefit based on VLSFO – HSFO spread of $236 basis Singapore bunkering for average January 2023. 3. Premium achieved will depend on the terms Himalaya Shipping is able to achieve in contracts entered into, inclu
Slide 15: The right financing: estimated cash break-even
15 71.6 $mValue of ship (average purchase price) 63.1 "Financing (average debt financing)1 88%%Loan to purchase price 16,567 $/dayFixed bareboat day-rate2 841 $/dayScrubber financing3 6,300"Estimated Opex 732"Estimated SG&A 24,440"Estimated cash break-even (3,700)$/dayEstimated scrubber benefit when
Slide 16: Summary
16 1. Energy Efficiency Existing Ship Index (EEXI) and Carbon Intensity Indicator (CII) 2. Based on 6 index-linked charters with a contracted premium to BCI 5TC of 40-42% 3) Basis 43 mT pr day fuel consumption and 3.2 CO2 pr mT for a 180k dwt 2014/15 built Capesize vessel and 28 mT pr day fuel consu