Hafnia Limited · OSL:HAFNI
Hafnia — Q3 2024 Earnings Presentation
27 slides from Hafnia's earnings presentation, Nov 27, 2024
Slide 1: Hafnia Quarterly Financial Investor Presentation Q3 2024
Hafnia Limited Quarterly Financial Hafnia Quarterly Financial Investor Presentation Q3 2024
Slide 2: Disclaimer – Safe Harbour Message
DISCLAIMER – SAFE HARBOUR MESSAGE IMPORTANT: You must read the following before continuing. The following applies to this document, the oral presentation of the information in this document by Hafnia Limited (the "Company") or any person on behalf of the Company, and any question-and-answer session
Slide 3: Agenda
Agenda Q3 2024 Overview Industry Review & Outlook Financial Summary ESG Overview
Slide 4: Q3 2024 Key Highlights
Q3 2024 KEY HIGHLIGHTS TCE Income1 USD 361.6M Q3 2023: USD 310.3M Adjusted EBITDA1 USD 257.0M Q3 2023: USD 220.8M Net Profit USD 215.6 M (USD 0.42 per share2) Q3 2023: USD 146.9M (USD 0.29 per share2) Dividend USD 194.1M (90% payout ratio) USD 0.3790 per share • TCE1 for Q3 2024 was USD 33,549 per o
Slide 5: Unparalleled Investment Opportunity
UNPARALLELED INVESTMENT OPPORTUNITY Fully integrated shipping platform with 100% alignment of interests and no fee leakage ACTIVE MANAGEMENT Vessels Owned1 / SHAREHOLDER VALUE Proactively reviewing market for Time Chartered-in Consistent dividend payout since opportunities that create stronger ▪ LR2
Slide 6: Maximizing Shareholder Returns: Record 90% Payout
MAXIMIZING SHAREHOLDER RETURNS: RECORD 90% PAYOUT Reaching new milestone in our commitment to shareholder returns Hafnia’s Dividend Policy Net loan-to-value1 Payout of net profit ▪ Net LTV ratio at the end of Q3 2024 decreased to 19.1%, Above 40 % 50 % down from 21.3% in Q2 2024. Above 30 % but equa
Slide 7: Agenda
Agenda Q3 2024 Overview Industry Review & Outlook Financial Summary ESG Overview
Slide 8: Strong Market Fundamentals for Product Trade
STRONG MARKET FUNDAMENTALS FOR PRODUCT TRADE Clean Petroleum Products On Water & Daily Departures CPP via Suez Transit m barrels m barrels m barrels 500 25 120 455 450 24 100 432 422 80 400 23 65 60 350 22 40 300 21 18 20 250 20 Jan Jan Jan Jan Jan Jan Jan Apr Apr Apr Apr Apr Apr Apr Jul Jul Oct Jul
Slide 9: Higher Cargo Volumes and Tonne-Miles
HIGHER CARGO VOLUMES AND TONNE-MILES CPPs and Chemicals Dirty Petroleum Products m barrels/day b tonne-miles/day m barrels/day b tonne-miles/day 26 12 55 35 33.2 32.5 32.2 33 11 32.1 10.5 31.5 25 10.1 31 9.5 9.6 10 50 24 29 8.8 8.8 28.1 9 8.4 23.5 26.5 27 23 8 23.1 46.9 46.8 22.8 22.9 45.9 22.7 45 2
Slide 10: CPP Tonne-Miles Against Earnings
CPP TONNE-MILES AGAINST EARNINGS CPPs and Chemicals Ton-miles and Loaded Volumes Ton-Miles vs LR1 Earnings m barrels/day b tonne-miles/day USD '000 b tonne-miles/day 26 12 11.2 55 12 11 50 10.5 11 25 11 45 10 24.2 40 10 24 10 23.7 23.7 23.8 9 35 23.5 23.5 23.1 23.2 9 23.0 23.1 23.1 30 23.0 22.9 23.0
Slide 11: CPP Tonne-Miles Against Earnings Correlation
CPP TONNE-MILES AGAINST EARNINGS CORRELATION Daily Ton-Mile per Vessel TCE USD/day 3,900,000 60,000 Fundamental 3,800,000 Sentiment 50,000 3,700,000 Fundamental 3,600,000 40,000 Sentiment 3,500,000 30,000 3,400,000 3,300,000 20,000 3,200,000 10,000 3,100,000 3,000,000 0 Jan Feb Mar Apr May Jun Jul A
Slide 12: Crude Tankers Cannibalization
CRUDE TANKERS CANNIBALIZATION Crude Tankers Cannibalization of Clean Cargo Suezmax & VLCC Cannibalization – Ton per Month b ton-mile/day m tons 12 7% 2.5 6% 2.0 2 11 5% 1.7 1.5 4% 10 3% 1 2% 9 0.5 0.5 1% 8 0% 0 Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr J
Slide 13: Tanker Fleet Outlook
TANKER FLEET OUTLOOK Scrap & Ageing versus Newbuild (Handy – VLCC) Vessels Dark Trade* Count (Handy – VLCC) as of Nov 2024 m DWT m barrels # Vessels 110 1000 47% 50% 3/4 of Trades 300 109 Russia-Related 109 241 108 800 750 40% 250 107 625 200 184 106 600 30% 105 150 104 400 20% 103 93 100 103 102 20
Slide 14: Reduced Utilisation of Ageing Fleet (Handy – Aframax)
REDUCED UTILISATION OF AGEING FLEET (HANDY – AFRAMAX) MR Equivalent Fleet Size and Age Distribution Reduced Utilization (Age Grouped) # MR Equivalents # Utilization % / # MR Equivalents 5,600 100% Days 6% 6% 7% 7% 7% 100% 250 11% 5,572 15% 90% 14% 16% 5,514 5,500 20% 83% 23% 80% 81% 80% 200 25% 77%
Slide 15: Tanker Delivery Landscape
TANKER DELIVERY LANDSCAPE Tanker Fleet Newbuild Delivery Timeline Historical Newbuilds Delivered (Handy – VLCC) by DWT # MR Equivalents m DWT Product Tanker Fleet # MR Equivalents 120 1200 70 100 1000 80 800 60 60 600 40 400 50 20 200 0 0 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Q
Slide 16: Agenda
Agenda Q3 2024 Overview Industry Review & Outlook Financial Summary ESG Overview
Slide 17: Q3 & YTD 9M 2024 Financial Summary
Q3 & YTD 9M 2024 FINANCIAL SUMMARY Income Statement Q3 2023 YTD 2023 Q3 2024 YTD 2024 USDm TCE income1 310.3 1,036.8 361.6 1,157.7 Return on Equity (annualised) Other operating income 14.9 36.2 7.8 28.3 60% Vessel operating & technical management expenses (78.1) (220.0) (77.5) (229.5) 44.5% Charter
Slide 18: Robust Financial Strength
ROBUST FINANCIAL STRENGTH Strong balance sheet and liquidity driving record shareholder returns Deleveraging Journey Total Liquidity USDm USDm USDm 4,536 700 Weighted 2,000 4,600 100% 413 ~610 average hedged 1,526 4,400 600 rate of 1.64% 74.6% 80% 4,200 500 3,963 60% 1,000 865 4,000 400 3,800 300 40
Slide 19: Share Buyback Considerations
SHARE BUYBACK CONSIDERATIONS Capitalizing on undervalued equity – Trading low compared to NAV Implied Vessel Values Share Price Movement USDm NOK USD 5-year old LR1 Implied Values 100 10 60 91.95 57.0 90 9 50 8.95 8 80 40 35.6 7 70 33.1 6 30 57.3 60 5 20 5.17 50 4 10 40 3 1996 1998 2000 2002 2004 20
Slide 20: Operating Summary
OPERATING SUMMARY Q3 2024 saw average TCE of USD 33,549 per day; with average OPEX of USD 8,141 per day Q3 2024 Vessel Segment Breakdown Spot TCE2 TCE2 Calendar days OPEX Spot TCE Operating days1 88% (USD/day) (USD/day) (excluding TC-in) (USD/day) USD 34,410 LR2 506 42,829 42,829 552 8,112 Total LR1
Slide 21: Earnings Scenarios and Fleet Coverage
EARNINGS SCENARIOS AND FLEET COVERAGE Product tanker fundamentals support positive 2024 earnings outlook Earnings Scenarios for Full Year 2024 USDm 1,500 Coverage1 as of November 18, 2024 ~1,070 1,000 ~830 Analysts’ Q4 2024 2025 Consensus2 500 Covered Covered rates Covered Covered rates (%) (USD/day
Slide 22: Agenda
Agenda Q3 2024 Overview Industry Review & Outlook Financial Summary ESG Overview
Slide 23: ESG Commitments and Targets
ESG COMMITMENTS AND TARGETS Environmental Social Governance 40% reduction Zero harm across our operations of our fleet’s carbon intensity by 2028 ✓ Lost Time Incident Frequency < 0.4 observation Zero compliance ✓ Total Recordable Case Frequency < 1.0 observation (compared to 2008 levels) ✓ Port Stat
Slide 24: Hafnia Strategic Project Highlights
HAFNIA STRATEGIC PROJECT HIGHLIGHTS Dual Fuel Vessels Complexio ▪ Invested in several dual-fuel Newbuilds. ▪ Co-founder of Complexio, a foundational AI, to advance data automation ▪ As part of Vista joint venture, invested in four LR2 LNG dual-fueled vessels. ▪ ‘bottom-up’ approach first ingests com
Slide 25: Market Leader with Unparalleled Scale
MARKET LEADER WITH UNPARALLELED SCALE MARKET LEADER OF PRODUCT FINANCIAL STRENGTH AND CHEMICAL TANKERS ▪ Consistent dividend growth: 90% payout ▪ Owned fleet of 115 vessels ratio in 3Q24 ▪ Commercially managing a fleet of ~200 ▪ Strong balance sheet: 19.1% Net LTV, lowest vessels across 8 pools in c
Slide 26: Experienced Management Team
EXPERIENCED MANAGEMENT TEAM Leveraging decades of maritime expertise to drive sustainable growth and enhance shareholder value Mikael Skov Perry Van Echtelt Søren Skibdal Winther Thomas Andersen CEO CFO VP, Commercial EVP, IR, Research & Performance Management ms@hafnia.com pve@hafnia.com ssw@hafnia
Slide 27: Thank you
Thank you www.hafnia.com