Himalaya Shipping Ltd. · OSL:HSHP
Himalaya Shipping — H1 2023 Earnings Presentation
14 slides from Himalaya Shipping's earnings presentation, Aug 8, 2023
Slide 1: Himalaya Shipping – H1 2023 result presentation
1 Himalaya Shipping – H1 2023 result presentation 10 August 2023
Slide 2: Disclaimer and Important Information
2 Disclaimer and Important Information THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THE SECURITIES REFERRED TO HEREIN IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR T
Slide 3: Highlights
3 Highlights 1H 2023 Highlights: • Completed Initial Public Offering (“IPO”) in the U.S. in April 2023, raising net equity proceeds of $44.9 million including the partial exercise of the Greenshoe option. • Successful delivery and commencement of operations of four Newcastlemax dual fuel newbuilding
Slide 4: Key Financials 1H 2023 Income statement
4 Key Financials 1H 2023 Income statement Comments US$ millions, except per share data 1H 2023 Operating revenues 8.2 Vessel operating expenses (2.0) Voyage expenses and commission (0.2) General and administrative expenses (1.8) Depreciation and amortization (2.4) Total operating expenses (6.4) Oper
Slide 5: Key Financials 1H 2023 Balance Sheet Summary
5 Key Financials 1H 2023 Balance Sheet Summary Comments US$ millions June 30, 2023 December 31, 2022 Total assets 459.8 177.8 Total equity 134.4 90.3 Cash and cash equivalents 24.2 0.3 Vessels and equipment 286.8 - Newbuildings 143.6 176.1 Short-term and long-term debt 305.9 67.5 • Cash increased by
Slide 6: The investment thesis
6 The investment thesis
Slide 7: The right timing: 25 year low orderbook
7 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.c
Slide 8: The right timing: older vessels at risk
8 Vessels built before 20093 Vessels built between 2009 and 20153 Vessels built post-2016 unaffected by 20303 313 ships – 15% 1,072 ships – 52% 680 ships – 33% The right timing 1. Capesize including sub-categories Newcastlemax and VLOC 2. Capesize fleet defined as all vessels delivered since 1996 un
Slide 9: The right ships
9 The right ships 43% more CO2 efficient than a standard Capesize4 1. Purchase price including variations orders, deducted Address Commissions, and cost of scrubbers ($2.4 million per vessel). 2. Address Commission to be deducted from the purchase price at delivery. 3. The contractual delivery dates
Slide 10: The right ships: fuel flexibility unlocking premium potential
10 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 11: LNG expected to be at a discount to VLSFO by 2026
11 LNG @ discount LNG @ discount Seasonality in LNG markets offer opportunity to bunker in LNG Any future carbon tax likely to make LNG a more appealing alternative HSFO preferred fuel with scrubber Some seasonal opportunities to use LNG The right ships LNG expected to be at a discount to VLSFO by 2
Slide 12: The right financing
12 Value of ship (average purchase price) $m 71.6 Financing (average debt financing)1 " 63.1 Loan to purchase price % 88% Fixed bareboat day-rate2 $/day 16,567 Scrubber financing3 $/day 841 Estimated Opex " 6,200 Estimated SG&A " 732 Estimated cash break-even " 24,340 Estimated scrubber benefit when
Slide 13: The right strategy
13 Himalaya has a brand new fleet No need for investments in fleet renewal Return cash-flow after debt service to shareholders Ambition to pay monthly dividends once ships are delivered The right strategy In the last cycle you made 6x just owning the assets Capital discipline $61k/day + 41% premium
Slide 14: Summary
14 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