Pacific Basin Shipping : Interim Report 2025

About this update from Pacific Basin Shipping Limited

NAVIGATING WITH AGILITY AND RESILIENCE INTERIM REPORT 2025 STOCK CODE: 2343 #WithYouForTheLongHaul OUR BUSINESS Who We Are We own and operate dry bulk cargo vessels, and our business is customer and cargo focused, providing over 600 industrial buyers, traders and producers of dry bulk commodities with a safe, reliable and competitive freight service under spot and long-term cargo contracts. We are listed in Hong Kong and operate globally, with local offices in key locations around the world and a large fleet of ships trading worldwide to service our international cargo customers This photo is a view from the Bridge of m/v Paqueta Island in Chile Front cover photos show our colleagues at work, m/v Barrow Island in port in Spain, and a PB vessel loading logs in New Zealand Back cover photos show our seafarers conducting lifeboat checks and our m/v Cook Strait team p.4 Our Business 406 shore staff in 14 offices around the world 4,300 crew supporting the needs of our 600+ industrial customers 260+ vessels completed 1,100 voyages in 1H 2025 About Our Fleet We operate one of the world's largest fleets of modern Handysize and Supramax vessels. Our geared (craned) bulk carriers are highly versatile self-loading and self-discharging vessels, and are laden over 90% of the time with cargoes comprising mainly non-fossil fuel commodities. This minor bulk segment offers benefits of diversification in terms of geography, customers and cargoes, enabling triangular trading, high laden utilisation and greater carbon efficiency CONTENTS 1H 2025 Highlights 1H 2025 Highlights Business Highlights Financial Highlights Sustainability & Governance Sustainability & Governance 25 Sustainability Highlights 31 Corporate Governance 34 Other Information Governance Our Business Our Business Our Fleet Our Global Reach 07 Our Cargo Volumes The Half Year in Review The Half Year in Review 09 Chief Executive's Review 12 Market Review 17 Our Performance 20 Core Business Vessel Costs 22 Cash and Borrowings Financial Results Financial Results 39 Group Performance Review 40 Financial Statements 44 Notes to the Financial Statements 53 Auditor's Review Report Thank you to our several Pacific Basin colleagues from across our owned fleet and office network who produced all the photos in this report Key to navigation symbols ESG Linkage to related details within the Interim Report Linkage to related details on our website https://www.pacificbasin.com Linkage to related details in our Sustainability Report 2024 High-level KPIs (Key Performance Indicators) ‌1H 2025 Highlights 2 BUSINESS HIGHLIGHTS Financial Resilience in Weaker $189m $158m $122m $85m $58m $549m 9% 6% $548m $550m Market Conditions In the first half of 2025, we generated an underlying profit of US$21.9 million, a net profit of US$25.6 million and EBITDA of US$121.5 million, yielding a return on equity of 3% (annualised) with basic EPS of HK3.9 cents We maintain a strong cash position with net cash of US$66.4 million and available committed liquidity of US$549.9 million In July 2025, we successfully concluded a new US$250 million 1H 1H 1H 1H 1H $26m 1H 3% 1H 1H 1H $28 2m $296m $262m Cash and deposits 1H syndicated sustainability-linked 7-year secured reducing revolving credit facility, which strengthens our financial capacity and supports our growth strategy The Board has declared an interim dividend of HK1.6 cents per share, which represents 50% of our net profit for the period, excluding vessel disposal gains 2023 2024 2025 EBITDA (US$) 2023 2024 2025 Net Profit (US$) 2023 2024 2025 Return on Equity 2023 2024 2025 Available Committed Liquidity (US$) as at 31 December and 30 June Business Performance In the first half of 2025, our core business achieved Handysize and Supramax daily time-charter equivalent ("TCE") earnings of US$11,010 and US$12,230 respectively, generating a total contribution of US$50.7 million before overheads We significantly outperformed the average Handysize (BHSI 38k dwt tonnage adjusted) and Supramax (BSI 58k dwt) indices by US$2,320 per day and US$3,480 per day respectively Our operating activity achieved a daily margin of US$710 over 14,200 operating days, generating a contribution of US$10.1 million before overheads Our P&L break-even was US$10,060 per day for core Handysize vessels and US$10,330 per day for core Supramax vessels in the period Our overheads and operating expenses remain well controlled and sector leading Our Fleet As at 30 June 2025, we owned 107 Handysize and Supramax/Ultramax vessels and have around 266 owned and chartered vessels on the water overall The estimated market value of our Handysize and Supramax fleet was US$1,802.0 million, significantly above our net book value of US$1,604.5 million We continued our fleet renewal initiatives to support our growth strategy and our transition towards a low-carbon future. During the first half of 2025, we sold and delivered three smaller and older Handysize vessels and two older Supramax vessels with an average age of 21 years, and we exercised purchase options on three Japanese-built Handysize vessels with an average age of six years Optimistic Outlook Despite Weaker Markets in Early 2025 Dry bulk shipping markets were weaker in the first half of 2025 than in the same period in the last four years, due to an unusual confluence of commodity-specific factors affecting the three major dry bulk commodities in the first quarter, before recovering in the second quarter Despite weaker markets in the early part of the year, we remain optimistic about the future of the dry bulk sector; in the near term, the market is firming and, while downside risk remains, we do not foresee any significant market decline Longer term, we stand to benefit from faster growing minor bulk and grain demand, with the global green energy infrastructure buildout as well as continuing rapid urbanisation in developing economies boosting trade in steels, cement and construction materials The supply-side outlook is encouraging, with the recent flurry of newbuilding deliveries absorbed by the market without significant distress, while dry bulk newbuild ordering activity is now limited by tight availability of shipyard capacity that has been largely taken up by other shipping sectors Find out more in our Chief Executive's Review on p.9 ‌FINANCIAL HIGHLIGHTS 1H 2025 Highlights 30 June 30 June 31 December 2025 2024 2024 US$ Million US$ Million US$ Million Results Revenue 1,018.7 1,281.5 2,581.6 Time-Charter Equivalent ("TCE") Earnings 556.5 717.2 1,482.0 EBITDA 1 121.5 157.9 333.4 EBIT 27.0 52.7 132.7 Underlying profit 21.9 43.9 114.1 Profit attributable to shareholders 25.6 57.6 131.7 Balance Sheet Total assets 2,330.9 2,410.3 2,414.0 Total cash and deposits 295.5 260.7 282.0 Available committed liquidity 549.9 537.4 547.6 Net cash/(borrowings) 66.4 (32.2) 19.7 Shareholders' equity 1,796.6 1,804.8 1,826.6 Capital commitments 182.0 18.2 146.6 Cash Flows Operating 124.6 133.6 309.3 Investing 17.1 (42.4) (87.4) Financing (119.9) (100.7) (214.4) Net change in cash and cash equivalents 21.8 (9.6) 7.5 Per Share Data HK cents HK cents HK cents Basic EPS 3.9 8.7 19.9 Dividends 1.6 4.1 9.2 Operating cash flows 19.1 20.1 46.6 Shareholders' equity 277.4 268.3 276.5 Share price at period end HK$2.02 HK$2.46 HK$1.64 Market capitalisation at period end HK$10.3bn HK$12.9bn HK$8.5bn Ratios Net profit margin 3% 4% 5% Return on average equity (annualised) 3% 6% 7% Total shareholders' return 26% (2)% (35)% Net cash/(borrowings) to net book value of owned vessels 4% (2)% 1% Net cash/(borrowings) to shareholders' equity 4% (2)% 1% Interest cover 14.8x 14.9x 16.8x 3 7 1 EBITDA (earnings before interest, tax, depreciation and amortisation) is gross profit less indirect general and administrative overheads, excluding: depreciation and amortisation; exchange differences; share-based compensation and unrealised derivative income and expenses ‌OUR BUSINESS Our Fleet Our Global Reach 07 Our Cargo Volumes Our Supramax m/v Barracuda Island discharging cement clinker in Douala, Cameroon ‌OUR FLEET Our Business 5 Top Ten 5% 22% Our geared bulk carriers are highly versatile self-loading and self-discharging vessels Our vessels transport mainly minor bulks including agricultural products, raw materials, construction materials and other essential bulk commodities Our cargo mix comprises mainly non-fossil fuel commodities p.7 Our Cargo Volumes 73% Handysize As at 30 June 2025 Vessels in Operation Long-term Short-term Owned Chartered Chartered 1 Total Total Capacity (Million dwt) Owned Average Age Owned Handysize 58 12 51 121 2.0 13.0 Supramax/ Ultramax 2 49 3 92 144 2.9 12.4 Capesize 3 1 - - 1 0.1 14.0 Total 108 15 143 266 5.0 12.7 (<20 years old) We operate approximately 5% of the global 25,000-40,000 dwt Handysize fleet of less than 20 years old 80% 4% Supramax (<20 years old) 16% Top Ten Our Handysize m/v Imabari Logger loading logs in Prince Rupert We operate approximately 4% of the global 40,000-70,000 dwt Supramax fleet of less than 20 years old Pacific Basin Other Top Ten Others Source: Pacific Basin, Clarksons Research Number of Vessels Estimated Market Value 4 (US$ Million) Total Net Book Value (US$ Million) As at 30 June 2025 Handysize 58 835.5 761.4 Supramax/Ultramax 2 49 966.5 843.1 Capesize 3 1 17.0 18.6 Total 108 1,819.0 1,623.1 1 Average number of short-term and index-linked vessels operated in June 2025 2 Supramax vessels in excess of 60,000 dwt are generally referred to as Ultramax 3 The Company owns one Capesize vessel which is chartered out on a long-term bareboat charter 4 Estimated market value reflects the latest estimated vessel values of our owned fleet based on composite broker valuations ‌Our Business 6 OUR GLOBAL REACH Vancouver London Dalian Tokyo Stamford Dubai Hong Kong Manila Iloilo Singapore Rio de Janeiro Durban Melbourne Santiago 14 office locations 11 commercial offices 4 technical & crewing offices Examples of key minor bulk trade routes fronthaul routes backhaul routes "Fronthaul" refers to shipping routes where there is high demand for vessels to transport commodities to areas where those commodities are needed. Conversely, "backhaul" refers to shipping routes where vessels transport commodities from areas with low demand for shipping services back to areas with higher demand ‌OUR CARGO VOLUMES 42.0 Million Tonnes Transported in 1H 2025 (44.7 Million Tonnes Transported in 1H 2024) Our Business 7 Minerals 11% Salt Sand & Gypsum Soda Ash Energy Coal Petcoke Wood Pellets Metals Ores Concentrates Alumina Others 6% 4% 1% 16% 14% 2% 0% 18% 8% 6% 2% 2% Agricultural Products & Related 29% 10% 15% 30% Grains & Agricultural Products Fertiliser Sugar 17% 10% 2% 16% 1H 2024 29% Construction Materials Cement & Cement Clinkers Steel & Scrap Logs & Forest Products 26% 14% 8% 4% 1H 2025 Our Cargo Loading & Discharging Activity by Volume in 1H 2025 (1H 2024) Middle East & India 11% Africa 6% Australia & New Zealand 13% 11% 12% 5% Europe 9% 14% 28% 1H 2024 Asia 32% (China 13%) 15% South America 17% 15% North America 12% 1H 2025 ‌THE HALF YEAR IN REVIEW 09 Chief Executive's Review 12 Market Review 17 Our Performance 20 Core Business Vessel Costs 22 Cash and Borrowings Our Supramax m/v Pelican Island sailing past m/v Imabari Logger in the Strait of Juan de Fuca ‌The Half Year in Review 9 CHIEF EXECUTIVE'S REVIEW Positive Financial Results in Weaker Freight Market Conditions In the first half of 2025, we generated an underlying profit of US$21.9 million, a net profit of US$25.6 million and EBITDA of US$121.5 million. This yielded a return on equity of 3% (annualised) with basic EPS of HK3.9 cents. We always strive to maintain cost leadership. Our overheads and operating expenses remain well controlled and sector leading. Our cash flow remains stable through the market cycle. Committed to Delivering Sound Shareholder Value Martin Fruergaard Chief Executive Officer "Geopolitical turbulence is a defining feature of 2025 and we are prepared for the unexpected, closely watching market developments and ready to leverage the agility of our business model and our financial strength to pursue opportunities that may emerge." p.39 Group Performance Review Our core business generated US$50.7 million before overheads, with average Handysize and Supramax daily time-charter equivalent ("TCE") earnings of US$11,010 and US$12,230 per day respectively for the first half 2025, representing a decrease of 7% and 11% respectively compared to the same period in 2024. We significantly outperformed the average Handysize (BHSI 38k dwt tonnage-adjusted) and Supramax (BSI 58k dwt) indices by US$2,320 per day and US$3,480 per day, or 27% and 40% respectively, consistent with our usual high level of outperformance. Our core business with its largely fixed costs is the main driver of our profitability, with a P&L break-even level for Handysize and Supramax vessels of US$10,060 and US$10,330 per day respectively. We have covered 60% and 74% of our Handysize and Supramax vessel days for the second half of 2025 at US$11,680 and US$13,480 per day respectively, which is prudent while maintaining exposure to spot rates if the market continues to strengthen. Our operating activity contributed US$10.1 million before overheads, representing 16% of our performance, and generating a margin of US$710 per day over 14,200 operating days. This represents a 29% improvement in margin on a similar volume of operating activity compared to the first half of 2024. p.17 Our Performance We have around 266 owned and chartered vessels on the water overall as at 30 June 2025. Distributing dividends consistent with our payout policy In view of our sound cash generation and strong balance sheet, the Board has declared an interim dividend of HK1.6 cents per share, which represents 50% of our net profit for the period, excluding vessel disposal gains. Strong balance sheet After total capital allocation of US$62.1 million, of which we spent an aggregate consideration of about US$21.0 million buying back and cancelling approximately 93.1 million shares under our 2025 share buyback programme, and capital expenditure of approximately US$41.1 million, our financial position remains strong. The Company is debt free on a net basis with a positive cash position of US$66.4 million and available committed liquidity of US$549.9 million as at 30 June 2025. p.22 Cash and Borrowings In July 2025, we successfully concluded a new US$250 million syndicated sustainability-linked 7-year secured reducing revolving credit facility, with interest margin adjustments linked to our carbon intensity (EEOI) and crew safety (LTIF) performance which we prioritise among our most important ESG issues. This is our second sustainability-linked financing facility, which is well timed to cover the remaining pre-delivery instalments in our newbuilding programme and to be ready for any counter-cyclical growth opportunities, thus supporting our growth ambitions. The Half Year in Review 10 Managing for value creation and growth Growing our business is a continuous priority, and we will continue to renew, grow and optimise our fleet in a disciplined way that prepares us for a low carbon future and considers the cyclicality of dry bulk shipping. That means: acquiring modern second-hand vessels, while also selling older and less efficient vessels; placing additional low-emission vessel (LEV) newbuilding orders; taking newbuilding vessels on long-term charter with purchase options; and/or continuously looking for accretive M&A opportunities where the synergies and the strategic and cultural fit are compelling. p.5 Our Fleet Asset values are high relative to prevailing spot market earnings, supporting the current case for selling older and less efficient vessels. With charter rates low in relation to asset values, we prefer long-term charter-in newbuilding ships with purchase options, while also exercising purchase options on attractively priced ships already on charter. Such optionality is very valuable, especially in uncertain and volatile times. We remain on the look-out for accretive M&A opportunities and, in view of the significant share discount relative to the market value of our assets, we also continue to repurchase our own shares which we consider more beneficial to our shareholders than acquiring second-hand vessels at current prices. Relatively Resilient Demand Despite Geopolitical Turbulence Dry bulk market rates were constrained by the usual seasonally slow first quarter as well as heightened geopolitical turbulence which undermined demand growth, while changing supply chains and multiple inefficiencies reduced supply. In the first half of 2025, dry bulk market earnings were below the same period in each of the last four years. Grain demand was subdued, as the largest corn importer, China, harvested its fourth consecutive record domestic crop. Iron ore loading operations were disrupted by a series of cyclones hitting Western Australia. And coal demand was subdued after the largest importer, China, achieved its policy target at the end of last year of building stocks to 15% of annual consumption. However, the tonne-mile slowdown was concentrated in the first quarter, with a sharp recovery in the second quarter. Bauxite shipments from Guinea continued a steep ramp up. Brazil had a record soybean harvest, with three quarters of its exports going long haul to China. Mining majors rushed to catch up with their iron ore export targets after the cyclones. And demand for better housing and infrastructure in developing economies drove a recovery in the cement and clinker trade from last year's depressed levels. The net effect of the two quarters was that total dry bulk tonne-miles reduced -3% year on year, with minor bulk tonne-miles up +7%, grain tonne-miles down -15%, iron ore tonne-miles down -4%, and coal tonne-miles down -9%. p.12 Market Review Short-Term Supply Pressure Partly Contained by Market Inefficiencies Global dry bulk net fleet growth persisted at +3% year on year in the period, outpacing demand growth as newbuildings ordered in the 2021/22 boom steadily delivered through the first half of 2025. The market has absorbed these newbuilding deliveries without significant distress. Total dry bulk newbuilding deliveries decelerated -5% year on year to 18.1 million dwt, against scrapping which decelerated -3% year on year to 2.2 million dwt. p.14 Supply Despite this supply growth, market utilisation and earnings were relatively resilient due to inefficiencies that made the global fleet less productive. The recovery in Panama Canal transits following low water levels in 2024 has stalled in 2025 at around 80% of normal levels. Meanwhile, Suez Canal transits continue to fall. The outbreak of war in the region, albeit for only twelve days, means more ships will take longer, safer routes and we remain some way from a conclusive return to normal Red Sea and Suez Canal transits. Port congestion has reemerged this year after some absence. Coal ports in Australia experienced heavy rains, causing delays which tied up Capesize and Panamax bulkers and indirectly affected all dry bulk segments. Our Handysize and Supramax segments have been directly impacted by congestion in Brazil, where a record soyabean crop combined with record demand for imported fertilisers, as well as strong West African demand for grains, steels, cement and aggregates has tied up more than 3% of the world's geared bulk carrier fleet in queues outside ports. In addition, the global dry bulk fleet continues to slow down, driven partly by environmental regulations to reduce CO 2 emissions. Decarbonisation In April 2025, the International Maritime Organisation's Marine Environment Protection Committee agreed on an IMO net-zero framework requiring ships to gradually reduce their annual greenhouse gas fuel intensity (with economic penalties and benefits for under-compliance and over-compliance respectively) in order that the shipping industry achieves the climate targets set out in IMO's 2023 greenhouse gas (GHG) emissions reduction strategy. Set to be formally adopted in October 2025 before entry into force in 2027, this framework is the first in the world to combine mandatory emissions limits and GHG pricing across an entire industry sector. It is expected to drive the transition to net-zero emissions by around 2050, and will likely encourage the early retirement of older and less efficient vessels, and hence contribute to a more favourable supply-demand balance. With the IMO's net-zero framework due to be adopted this October, green fuels are another priority for us and, following our newbuilding order last November for four Ultramax dual-fuel low-emission vessels (LEVs), we have signed a MOU with The Hong Kong and China Gas Company (Towngas) that will enhance our access to green methanol marine fuel. We are also studying designs for Handysize LEV newbuildings so that we might soon commence our gradual transition to net-zero emission shipping in both our Ultramax and Handysize segments, while complying with increasingly stringent regulations. Alongside with our green ships and green fuels programmes, we continue as always to leverage our technical decarbonisation, operational voyage optimisation and digitalisation capabilities to improve the energy efficiency of our existing conventionally-fuelled ships and optimise voyages for reduced fuel and carbon intensity. p.26 Environmental Responsibility The Half Year in Review 11 US Regulatory Developments The United States Trade Representative (USTR) Section 301 investigation into China's dominance in shipbuilding and the SHIPS For America Act, currently at committee stage in Congress, both have the potential to increase costs for our business and significantly impact the dry bulk shipping industry. The United States is the world's fourth largest exporter of dry bulk cargo and the second largest exporter using geared bulk carriers, and represents a significant part of our business with 9% of our total worldwide port calls being in the US in 2024. If implemented as currently formulated, these new rules could increase US port costs for us and increase freight costs for US importers and exporters by restricting the supply of ships able to call at US ports, potentially creating a two-tier market. We have been closely monitoring and preparing for these USTR 301-related developments and readying contingency plans to maintain our competitiveness in the changing trade and tariff landscape. The detailed final rules due to be implemented in October will depend on how USTR 301 and trade tariff negotiations between the United States and China unfold in the coming months. Our ultimate objective is to ensure that Pacific Basin ships can continue to service our global customers freely and competitively to and via all safe ports and countries, including the United States. Board and Leadership Changes As previously announced, Ms. Kalpana Desai and Ms. Heather Wang joined our Board on 1 February 2025 as Independent Non-executive Directors, and Mr. Jimmy Ng joined the executive team on 12 May 2025 as our new Chief Financial Officer. We are grateful for the valuable contributions that they have already brought to our Board and Board committees and to our executive team respectively. Optimistic about the Future of Dry Bulk Shipping Despite weaker markets in the first half of 2025, we remain optimistic about the future of the dry bulk sector. In the near term, the market is firming and, while downside risk remains, we do not foresee any significant market decline. Longer term, the geared bulk carrier segments in which we are engaged stand to benefit from faster growing minor bulk and grain demand, with the global green energy infrastructure buildout as well as continuing rapid urbanisation in developing economies boosting trade in steels, cement and construction materials. The supply-side outlook is similarly encouraging, with the recent flurry of newbuilding deliveries absorbed by the market without significant distress, while dry bulk newbuild ordering activity is now limited by tight availability of shipyard capacity that has been largely taken up by other shipping sectors. Additionally, the pressure and cost of decarbonisation regulations on a growing number of older, less-efficient, conventional- fuel ships also add to the potential for structural undersupply in minor bulk shipping. Meanwhile, we are prepared for uncertainties, challenges and opportunities, and will continue to monitor protectionist activity to ensure we can always trade our ships as widely and flexibly as possible. We continue as always to cultivate our relationships and resources and take steps to ensure we are nimble, resilient, strong and high performing, so that we can continue our progress towards our vision to be the leading ship owner/ operator in the dry bulk shipping sector and the first-choice partner for all stakeholders. A deck officer of m/v Badger Island checking stowage and lashing of steel coils I thank my Pacific Basin colleagues at sea and ashore, and our cargo customers, shareholders and all our partners for their continued support. Martin Fruergaard Chief Executive Officer Hong Kong, 7 August 2025 ‌The Half Year in Review 12 MARKET REVIEW A weaker first half freight market than in the last few years US$8,690 net 21% YOY BHSI 38K (tonnage adjusted) Handysize 1H25 avg. market spot rate US$8,750 net 34% YOY BSI 58K Supramax 1H25 avg. market spot rate Dry bulk shipping markets were weaker in the first half of 2025 than in the same period in the last four years. This was due to an unusual confluence of commodity-specific factors affecting the three major dry bulk commodities (grain, iron ore, and coal) Handysize Market Spot Rates in 2022-2025 Supramax Market Spot Rates in 2022-2025 US$/day net* US$/day net* in the first quarter, before all recovering in the second quarter. Disruptions to the usual efficient functioning of shipping markets also persisted, with the re-emergence of congestion after a long 35,000 30,000 25,000 20,000 35,000 30,000 25,000 20,000 2023 absence, and Suez Canal transits continuing to decrease. The net effect is that freight rates in the first half of 2025 eased to US$8,690 net per day for Handysize (-21% year on year, tonnage-adjusted) and US$8,750 net per day for Supramax (-34% year on year). 15,000 10,000 5,000 2023 2022 $10,860 2024 15,000 10,000 5,000 $13,300 2022 2024 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec * Excludes 5% commission 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: Baltic Exchange (BHSI 38,200 dwt (tonnage adjusted) and BSI 58,328 dwt), data as at 1 August 2025 Vessel values continued to soften US$30.5m 17% Benchmark five-year old second-hand Ultramax values YOY Source: Clarksons Research, data as at June 2025 Second-hand values for modern assets continued their decline from the end of last year, although with a brief upward blip at the start of Q2. This decline was mainly due to the softer earnings environment and subdued outlook. Newbuilding prices also declined from last year's 16-year highs, albeit very slowly, which also added mild pressure on second-hand values. p.16 Market Balance & Possible Market Drivers The Half Year in Review 13 DEMAND Tonne-mile demand impacted by unusual confluence of events Oceanbolt data shows global tonne-mile demand fell by -3% year on year in first half 2025, led by the three major bulk commodities, while the minor bulks contributed positively. Minor bulk tonne-mile demand rose +7% year on year. This was led by bauxite, as China's CHALCO continued to ramp up mining in Guinea. China's imports from the West African country totalled 79.7 million tonnes in first half 2025 (+41% year on year). Cement and clinker tonne-miles also bounced back +11% year on year, after a depressed first half 2024. Led by developing economies, this demonstrates the long-term resilience of this trade, as rising populations with growing per capita incomes demand better housing and infrastructure. Grain tonne-mile demand fell -15% year on year, as China's imports fell to 61.4 million tonnes (-25% year on year). China harvested its fourth consecutive record crop, as it makes significant strides in seed technology. This impacted exports from two of its largest suppliers, Brazil (-5% year on year) and Ukraine (-9% year on year). Coal tonne-mile demand fell -9% year on year. China is the largest importer, having increased its coal buying since 2021 when Beijing announced a policy of building inventories to 15% of consumption. It reached this target in the final weeks of 2024, after which seaborne imports decelerated sharply to 64.0 million tonnes in first half 2005 (-23% year on year), which hit exports from its major suppliers Indonesia (-4% year on year), Australia (-8% year on year), and Russia (-8% year on year). 1H 2025 Global Cargo Loading Volumes # YOY Change Selected Minor Bulks* Grain Iron Ore Coal +3% -13% -4% -7% * Minerals, non-coal energy, metals and minor ores, fertiliser, sugar and non-grain agricultural products, cement and clinker, logs and forest products, steel and scrap Source: Oceanbolt, data as at July 2025, subject to revision Minor bulk demand is broad based and diverse, both geographically and in terms of commodities and customers, and normally tracks growth in GDP. # Cargo volume is different to tonne-mile demand. Tonne-miles is the primary measure of transport demand. A tonne-mile is defined as one tonne of freight shipped one mile, and therefore reflects both the volume shipped (tonnes) and distance shipped (miles) Changes in Global Dry Bulk Demand YOY change in billion tonne-miles 1,200 +5% +7% -4% -9% -15% -4% +2% +1% +10% 1,000 800 600 400 200 0 -200 -400 -600 -800 -3% Iron ore tonne-mile demand fell -4% year on year, as cyclones 1H20 1H21 1H22 1H23 1H24 1H25 hit Australia, forcing key ports to close. However, since then, miners accelerated production to catch up with targets. Australia's first half exports totalled 468.9 million tonnes (-3% year on year). Iron Ore Coal Grains Minor Bulk Source: Oceanbolt, data as at July 2025, subject to revision ‌The Half Year in Review 14 SUPPLY Fleet growth was steady, but fleet efficiency declined Total dry bulk fleet growth remained steady at +1.5% over the first half of 2025, with the emphasis shifting towards geared bulkers. Fleet growth for the Handysize and Supramax segments accelerated to +2.3% over the period, while fleet growth in the larger Capesize and Panamax segments decelerated to +1.1%. Total dry bulk newbuilding deliveries decelerated to 18.1 million dwt in the first half of 2025 (-5% year on year), as ships ordered during the 2021/22 boom hit the water. This was led by Handysize and Supramax deliveries accelerating to 9.2 million dwt (+11% year on year), while Capesize and Panamax deliveries decelerated to 8.9 million dwt (-17% year on year). Overall Dry Bulk Supply Development 1.5% Overall dry bulk capacity in 1H25 % of Total Fleet 5.0 4.0 Handysize/Supramax Supply Development 2.3% Global Handysize/Supramax capacity in 1H25 % of Total Fleet 4.2% 4.3% 3.8% 3.4% 5.0 4.0 Meanwhile, at the other end of the age spectrum, total dry bulk scrapping fell to 2.2 million dwt in the first half of 2025 (-3% year on year), with Handysize and Supramax scrapping falling to 0.7 million dwt (-8% year on year), and Capesize and Panamax scrapping remaining stable at 1.5 million dwt (flat year on year) The impact of fleet growth on the supply/demand balance is partially offset by an ongoing decline in fleet productivity. The Suez Canal continued to be disrupted, causing widespread re-routing of voyages around the Cape of Good Hope. A multi-year trend of slowing speeds continues, as operators try to limit CO emissions. And port 3.0 2.0 1.0 0.0 -1.0 3.1% 3.0% 3.1% 3.3% 3.0 2.0 1.0 0.0 -1.0 2 congestion in the South Atlantic tied up almost 3% of the Handysize 2023 2024 2025F 2026F 2023 2024 2025F 2026F and Supramax fleet for long periods. New Deliveries Deliveries Forecast Clarksons forecasts total dry bulk fleet growth at +3.1% year on year in 2025, but effective supply growth will also be determined by efficiency factors. Speeds are widely expected to continue slowing, but port Scrapping Net Fleet Growth Scrapping Forecast congestion and the return of canal transits are wildcards. Source: Clarksons Research, data as at July 2025 Net fleet growth is expected to moderate in the next few years due to reducing new vessel ordering and potentially increased scrapping as the fleet ages and decarbonisation regulations tighten. In time, decarbonisation regulations from IMO and EU will likely force slower vessel speeds which will also reduce supply, boding well for the market in the longer term. The Half Year in Review 15 ORDERBOOK New ship ordering deterred by renewed regulatory uncertainty The total dry bulk orderbook currently stands at 113.2 million dwt or 10.8% of the fleet. In the Handysize and Supramax segments, the orderbook is 39.7 million dwt or 10.4% of the fleet. This remains relatively low, both historically and compared to other shipping sectors, and suggests that supply growth will remain manageable for the next few years. New ordering, which was already subdued due to uncertainty over new fuel technologies, high newbuilding prices and limited shipyard capacity, fell further to 9.7 million dwt in the first half of 2025 (-73% year on year), with Handysize and Supramax orders falling to 2.2 million dwt (-86% year on year). This was caused by new uncertainty over the announcement of US protectionist actions against foreign ships arriving in US ports. The SHIPS for America Act, which is currently at the committee stage of the legislative process, contains punitive fees for any owners with Chinese-built ships or ships on order at Chinese Overall Dry Bulk Orderbook % of Total Fleet 4.8% 50.5m 4.0% 41.8m 2.0% 20.6m 1.8% 18.2m 2.0% 20.9m 5.5 5.0 4.0% 41.8m 4.5 4.0 3.5 2.0% 20.6m 3.0 2.0% 20.9m 1.8% 18.2m 2.5 2.0 12% Shortfall 12% Shortfall 1.5 1.0 0.5 0.0 Handysize & Supramax Combined Orderbook % of Total Fleet 4.8% 50.5m 4.4% 16.6m 3.5% 13.4m 2.8% 10.4m 2.5% 9.3m 2.5% 9.7m 5.5 4.4% 16.6m 5.0 4.5 3.5% 13.4m 4.0 2.8% 10.4m 3.5 2.5% 9.7m 2.5% 9.3m 3.0 2.5 11% Shortfall 11% Shortfall 2.0 1.5 1.0 0.5 0.0 shipyards. This deterred ordering of new ships in China, and with Scheduled Actual orderbook delivery Remainder of 2026 2025 2027+ Scheduled Actual orderbook delivery Remainder of 2026 2025 2027+ the next most viable market Japan still comparatively expensive and capacity constrained, dry bulk ordering fell to an eight-year low. 1H 2025 Scheduled orderbook 1H 2025 Scheduled orderbook Source: Clarksons Research, data as at July 2025 Orderbook as % of Existing Fleet Average Age Over 20 Years Old 1H 2025 Scrapping as % of 1 January 2025 Existing Fleet Handysize (10,000-40,000 dwt) Supramax & Ultramax (40,000-70,000 dwt) 8.8% 14 14% 0.4% 11.3% 13 12% 0.1% Panamax & Post-Panamax (70,000-100,000 dwt) 14.0% 13 14% 0.3% Capesize (100,000+ dwt) 8.9% 12 5% 0.1% Total 10.8% 13 10% 0.2% Source: Clarksons Research, data as at July 2025 ‌The Half Year in Review 16 MARKET BALANCE Subdued outlook, but the geared minor bulk segments are more balanced Total Dry Bulk Demand and Supply % YOY change 5.0% 3.1% 3.3% 0.6% 0.2% 4.0% 3.0% 2.0% 1.0% 0.0% 2025F 2026F Minor Bulk Demand and Handysize/Supramax Supply % YOY change 5.0% 3.6% 3.8% 1.8% 4.3% 4.0% 3.0% 2.0% 1.0% 0.0% 2025F 2026F Clarksons forecast that supply will continue to outpace demand in dry bulk shipping in 2025, due to expected high levels of new ship deliveries and limited scrapping, but much depends on the development of US trade policy and fleet productivity factors, particularly Suez Canal transits. Within the overall balance, Clarksons forecast Supramax and Handysize fleet growth to continue at a faster pace than Capesize and Panamax fleet growth, but they also predict that grains and minor bulks, the main cargoes for Supramax and Handysize, will see faster volume and tonne-mile growth than iron ore and coal, the main cargoes for Capesize and Panamax. Hence, the outlook is subdued, but our segments should be relatively resilient. Tonne-Mile Demand Net Fleet Growth Source: Clarksons Research, data as at July 2025 POSSIBLE MARKET DRIVERS IN THE MEDIUM TERM OPPORTUNITIES Importers of dry bulk commodities from the US shifting to longer haul sources, (e.g. China buying soyabeans from Brazil) in reaction to US trade policy Monetary and/or fiscal stimulus in China, focused on investment in infrastructure and urban renewal, driving demand for dry bulk commodities Increasing cooperation, investment, and trade between China and other developing economies, in reaction to US trade policy, supporting Chinese steel exports and global commodity demand Slower vessel operating speeds due to emissions regulations and increased fuel costs Limited new vessel ordering due to uncertainty over fuel technologies and US trade policy, leading to tighter supply Increased scrapping of older and less fuel-efficient tonnage facing onerous environmental regulations and expensive maintenance and upgrade THREATS Geopolitics negatively impacting global economic growth which reduces demand for dry bulk commodities A rapid recovery in Suez Canal transits improves fleet productivity and raises effective supply growth Surging long-term bond yields driving higher interest rates and negatively impacting global economic activity and demand in dry bulk commodities Chinese economic growth slower than expected despite stimulus Limited scrapping of vessels due to IMO pushing out decarbonisation targets ‌OUR PERFORMANCE The Half Year in Review 17 Our business generated an underlying profit of US$21.9 million for the first half of 2025, representing a 50% decrease compared to the same period last year due to reduced revenue amid weaker freight market conditions. Although the contribution from our core business declined year on year due to lower market freight rates and fewer revenue days, we significantly outperformed both the Handysize and Supramax market indices by approximately 27% and 40% respectively, and our operating activity margin and contribution improved by 29% compared to the same period in 2024. Operating Performance Six months ended 30 June US$ Million 2025 2024 Change Core business Handysize contribution 24.2 41.1 -41% Core business Supramax contribution 26.5 35.7 -26% Operating activity contribution 10.1 7.8 +29% Capesize contribution 0.8 0.8 - Performance before overheads 61.6 85.4 -28% Adjusted total G&A overheads (39.4) (41.2) +4% Tax and others (0.3) (0.3) - Underlying profit 21.9 43.9 -50% +/- Note: In our tabulated figures, positive changes represent an improving result and negative changes represent a worsening result Our Commercial Activities Core Business Our core business is to optimally combine our owned and long-term chartered vessels with multi-shipment contract cargoes and spot cargoes to achieve the highest daily TCE earnings. Our core business also uses short-term chartered vessels to carry contract cargoes to maximise the utilisation and TCE of our owned and long-term chartered vessels. Operating Activity Our operating activity complements our core business by matching our customers' spot cargoes with short-term chartered vessels, making a margin and contributing to our Group results regardless of whether the market is weak or strong. Through our operating activity, we provide a service to our customers even if our core vessels are unavailable. The Half Year in Review 18 CORE BUSINESS Handysize Supramax TCE EARNINGS US$/day 30,000 TCE EARNINGS 29,350 28,120 13,830 13,630 12,230 US$/day 30,000 TCE EARNINGS In the period, our core business generated: Handysize daily earnings of US$11,010 on 12,570 revenue days Supramax daily earnings of US$12,230 on 9,480 revenue days 25,000 20,000 15,000 10,000 5,000 23,430 25,000 20,460 12,250 12,840 11,010 20,000 15,000 10,000 5,000 Our Handysize vessels outperformed the index (BHSI 38k dwt tonnage-adjusted) by US$2,320 or 27% per day Our Supramax vessels significantly outperformed the index (BSI 58k dwt) by US$3,480 or 40% per day. Scrubbers fitted to our 33 core Supramax vessels contributed US$210 per day to our outperformance This marks a return to our usual high level of TCE outperformance 0 0 2021 2022 2023 2024 1H 2025 2021 2022 2023 2024 1H 2025 Handysize FORWARD CARGO COVER US$/day 16,000 Supramax FORWARD CARGO COVER US$/day 16,000 14,000 13,750 12,670 14,000 13,440 13,950* 13,480* 12,640 12,000 11,940* 11,680* 12,000 10,000 8,000 6,000 4,000 10,000 8,000 87% of days 60% of days 87% of days 60% of days 6,000 4,000 98% of days 82% of days 99% of days 74% of days 2,000 2,000 0 0 FORWARD CARGO COVER We are strategically managing our forward cargo coverage alongside our spot market exposure, anticipating the return of seasonality that is expected to bolster freight rates in the third quarter We have covered 87% and 99% of our Handysize and Supramax committed vessel days currently contracted for the third quarter of 2025 at US$11,940 and US$13,950 per day respectively We have covered 60% and 74% of our Handysize and Supramax committed vessel days currently contracted for the second half of 2025 at US$11,680 and US$13,480 per day respectively Our P&L break-even was US$10,060 per day for core Handysize vessels and US$10,330 per day for core Supramax vessels in the first half of 2025; our costs remain well controlled and sector leading 3Q24 2H24 3Q25 2H25 3Q24 2H24 3Q25 2H25 Indicative core fleet P&L break-even level incl. G&A for 1H25 = Indicative core fleet P&L break-even level incl. G&A for 1H25 = US$10,060 US$10,330 * As of early August 2025, indicative TCE rates only as voyages are still * As of early August 2025, indicative TCE rates only as voyages are in progress still in progress OPERATING ACTIVITY MARGIN US$710 per day US$/day Days The Half Year in Review 19 3,500 3,000 2,500 2,000 1,500 1,000 500 0 3,330 1,550 710 550 1H22 1H23 1H24 1H25 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Operating activity days Operating activity margins In the first half of 2025, our operating activity contributed US$10.1 million or 16% of our Group's performance before overheads, generated a margin of US$710 per day over 14,200 operating activity days Our operating activity margin increased by 29% while our operating activity days remained stable Our operating activity complements our core business by matching our customers' spot cargoes with short-term chartered vessels (when our core vessels are unavailable), thereby making a margin and contributing to our Group's results regardless of whether the market is weak or strong ‌The Half Year in Review 20 CORE BUSINESS VESSEL COSTS Daily Vessel Costs Handysize Blended US$8,930 Owned Vessel Costs Operating expenses Our average Handysize and Supramax daily operating expenses ("Opex") were substantially unchanged Long-term Chartered Vessel Costs Long-term chartered vessel costs mainly comprise depreciation of right-of-use assets, interest expenses of lease liabilities and technical management service costs US$/day 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Number of vessels* Avg. DWT* Supramax FY2024 1H2025 12,330 12,300 8 ,09 0 8,750 8,930 110 8 ,210 3,380 90 3,450 General and Administrative ("G&A") Overheads Our adjusted total G&A overheads decreased to US$39.4 million (1H2024: US$41.2 million and FY2024: US$82.7 million) mainly due to the foreign exchange gains from the appreciation of our Japanese Yen deposits for vessel purchases. Spread across our total vessel days, our daily G&A overheads remain competitive at US$830 (FY2024: US$780), comprising US$1,130 and US$610 (FY2024: US$1,070 and US$600) for owned and chartered vessels respectively. 4,60 Owned 60 0 Long-Term Chartered 13 Blended 73 4,670 Owned Long-Term Chartered 58 Blended 70 Our Handysize and Supramax daily depreciation costs increased by 2% and 4% respectively, mainly due to higher drydocking costs and investments in fuel-efficiency enhancements. Our daily blended costs for owned and long-term chartered vessels increased to US$8,930 for Handysize vessels (FY2024: US$8,750) and decreased to US$9,200 for Supramax vessels (FY2024: US$9,650). 34,790 38,890 35,520 35,070 39,650 35,790 Finance costs 12 US$4,700 (FY2024: US$4,750). Our Opex remained at industry competitive levels through good cost control and scale benefits as well as efficient procurement. During the period, our fleet of owned vessels experienced on average 1.0 day (FY2024: 2.4 days) of unplanned technical off-hire per vessel. Depreciation The 20% decrease in our average Handysize and Supramax daily finance costs to US$120 (FY2024: US$150) was the combined result of lower average for leases over 12 months. Our Handysize long-term chartered vessel daily costs remained largely unchanged at US$12,300. In contrast, our Supramax long-term chartered vessel daily costs reduced by 13% to US$14,120 primarily due to the redelivery of vessels that had been chartered at higher charter rates. Blended Costs Blended US$9,200 FY2024 1H2025 borrowings and lower interest income and interest expenses due to decreased interest rates. US$/day 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 16,310 8,980 9,650 190 3,850 4,940 14,120 8,900 9,200 160 4,010 4,730 0 Owned Long-Term Chartered Blended Owned Long-Term Chartered Blended Number of vessels* 51 4 55 49 3 52 "We always strive to maintain cost leadership. Our overheads and Avg. DWT* 58,630 61,000 58,880 58,730 63,700 59,020 operating expenses remain well controlled and sector leading." Opex Depreciation * Fleet as at 31 December 2024 and 30 June 2025 Finance Cost The Half Year in Review 21 Vessel Days The following table shows an analysis of our vessel days in 1H2025 and 2024: Handysize Supramax Days FY2024 1H2025 FY2024 1H2025 Core business revenue days 27,010 12,570 19,560 9,480 - Owned revenue days 22,750 10,330 17,700 8,930 - Long-term chartered days 4,260 2,240 1,860 550 Short-term core days 1 11,640 4,090 19,090 6,790 Operating activity days 11,240 5,180 16,370 9,020 Owned off-hire days 370 230 680 230 Total vessel days 50,260 22,070 55,700 25,520 1 Short-term chartered vessels used to support our core business Future Long-term Chartered Vessel Costs The following table shows the average daily charter costs for our longterm chartered vessels during their remaining charter period by year: Handysize Supramax Average Average Vessel cost Vessel cost Year days (US$) days (US$) 2H2025 1,580 12,840 740 14,650 2026 2,720 13,170 1,400 15,050 2027 2,190 13,190 1,460 14,680 2028 2,140 12,780 1,460 14,250 2029+ 2,060 12,820 2,660 13,780 Total 10,690 7,720 Top left: m/v Barracuda Island in dry dock in China Bottom left: m/v Scrub Island loading salt in Dampier Right: Funnel painting on m/v Seal Island ‌The Half Year in Review 22 CASH AND BORROWINGS Cash Flow Key Developments in 1H 2025 Operating Cash Inflow US$ 104 m Available Committed Liquidity US$ 550 m Net Cash to Net Book Value of Owned Vessels 4% Average Interest Rate (P/L) 5.5% US$ Million 500 +104 -33 -31 -21 282 -1 -5 296 400 300 200 +42 -41 We realised US$41.7 million from the sale of 3 Handysize and 2 Supramax vessels Our net cash outflow from borrowings was US$31.4 million We spent US$21.0 million to repurchase shares under our announced share buyback programme We incurred capital expenditure of US$41.1 million, including: US$19.6 million for 1 Handysize vessel which delivered into our fleet in first half 2025 and 1 Handysize vessel which delivered in July 2025 US$21.5 million for dry dockings and other additions In July 2025, we announced a new US$250 million syndicated sustainability-linked 7-year reducing revolving credit facility secured against 20 unmortgaged vessels which further extends our funding profile, increases our available committed liquidity and strengthens our financial capacity. As at 30 June 2025, we had 55 unmortgaged vessels To provide readers with a better understanding of our cash flows, our presentation in this section considers charter-hire payments as operating cash flow, before applying HKFRS 16 -"Leases" accounting treatment 100 0 At 1 Jan 2025 Operating cash inflow Vessel sales Capex Dividends Change in borrowings Share buyback Net interest Others Liquidity and Borrowings US$ Million Cash and deposits (a) Available undrawn committed facilities Available committed liquidity Current portion of borrowings Non-current portion of borrowings Total borrowings (b) Net cash (a) + (b) Net cash to shareholders' equity Net cash to net book value of owned vessels 30 Jun 2025 295.5 31 Dec 2024 282.0 Change +5% 254.4 549.9 (123.3) (105.8) (229.1) 66.4 4% 265.6 547.6 (76.5) (185.8) (262.3) 19.7 1% -4% 0% +13% >+100% 4% 1% p.49 Financial Statements Note 15 Cash and deposits (including how we invest our cash) At 30 Jun 2025 Cash and deposits balance Cash inflow Cash outflow Borrowings and Undrawn Committed Facilities The Half Year in Review 23 Borrowings and Undrawn Committed Facilities - US$459.0 million (31 December 2024: US$500.2 million) Schedule of Reduction in Borrowings and Undrawn Committed Facilities Borrowings and undrawn committed facilities decreased during the period mainly due to repayments and scheduled loan amortisation. A decrease in interest to US$6.5 million (1H 2024: US$8.7 million) was mainly due to a decrease in average borrowings to US$229.4 million. The Group monitors the loan-to-asset value requirements on its bank borrowings. If the market values of the Group's mortgaged assets fall below the level prescribed by our lenders, the Group may pledge additional cash or offer other additional collateral unless the banks offer waivers for technical breaches. As at 30 June 2025: The Group's secured borrowings were secured by 53 vessels with a total net book value of US$868.7 million and by an assignment of earnings and insurances in respect of these vessels The Group was in compliance with all its loan-to-asset value requirements p.46 Financial Statements Note 7 Finance income and finance costs US$ Million 300 250 200 150 100 50 0 260 177 121 61 50 83 16 25 34 60 25 3 2H2025 2026 2027 2028 2029 Convertible Bonds Liability Component - US$24.5 million (31 December 2024: US$27.7 million) Following the conversion offer completed in May 2022, a subsequent bondholder conversion in July 2022, the open market repurchase of convertible bonds in December 2022 and further bondholder conversions in May 2023, June 2024 and June 2025, as at 30 June 2025, there remained the 3% coupon guaranteed convertible bonds due in 2025 with an outstanding principal amount of US$24.6 million and a prevailing conversion price of HK$1.35 per share. On 4 July 2025, a further principal amount of US$13.2 million of convertible bonds were converted. The Group exercised its redemption option on 11 July 2025 relating to the remaining outstanding bonds at the nominal value of US$11.4 million, subsequent to which US$11.1 million of convertible bonds were converted. Any outstanding bonds that are not converted will be redeemed and cancelled on 14 August 2025, thereby cancelling the convertible bonds in full. Undrawn committed facilities (US$254.4 million) Borrowings (US$204.6 million) Convertible bonds (face value US$24.6 million, book value US$24.5 million) We arrange financing by leveraging the Group's balance sheet to optimise the availability of cash resources of the Group. The aggregate borrowings and undrawn committed facilities of the Group at 30 June 2025, including the liability component of the convertible bonds, are denominated in United States Dollars and amounted to US$483.5 million (31 December 2024: US$527.9 million). Finance Costs Average interest Balance at The KPIs on which management focuses to assess the cost of rate 30 June Finance costs borrowings are: US$ Million P/L Cash 2025 1H 2025 1H 2024 Change ■ average interest rates for different types of borrowings; and Borrowings (including realised interest rate swap contracts) 5.6% 5.6% 204.6 6.5 8.7 +25% Convertible bonds (Note) 4.7% 3.0% 24.5 0.6 0.7 +15% The Group aims to achieve a balance between floating and fixed interest 5.5% 5.4% 229.1 7.1 9.4 -6% +24% rates on its borrowings. As at 30 June 2025, 66% (31 December 2024: 69%) of the Group's borrowings were on fixed interest rates. Other finance charges 1.1 1.2 Total finance costs 8.2 10.6 +23% Interest coverage (calculated as EBITDA divided by total finance costs) 14.8x 14.9x Note: The convertible bonds have a P/L cost of US$0.6 million and a cash cost of US$0.4 million. the Group's interest coverage. ‌SUSTAINABILITY & GOVERNANCE‌ 25 Sustainability Highlights 31 Corporate Governance 34 Other Information ‌SUSTAINABILITY HIGHLIGHTS Our industry is facing an evolving and increasingly complex business landscape which poses both risks and opportunities for our Company. To navigate the challenges of today and tomorrow, and to further define our role as industry leaders, we are harnessing our culture of "doing the right thing" and putting it to work in a pragmatic sustainability framework comprising four pillars of responsibility Sustainability & Governance 25 Our Sustainability Priorities We prioritise our 20+ sustainability issues based on our assessments of what is currently most important to our stakeholders, our business, society and the environment, as well as what is most urgent and where we choose to be more ambitious. We currently see these five ESG issues as our Company's top-most sustainability focus areas: ENVIRONMENTAL RESPONSIBILITY high-performing workforce Decarbonising our fleet, managing our waste and use of resources, and minimising our impact on biodiversity as we continue to grow our business RESPONSIBLE BUSINESS FUNDAMENTALS Evolving and enhancing management and governance practices (including due diligence, financial and risk management, integrity and transparency) to safeguard business resilience and stakeholder trust and confidence RESPONSIBILITY TO OUR PEOPLE Safeguarding a decent, healthy and safe work environment and nurturing an empowered and inclusive organisation, while developing a diverse, well-supported and RESPONSIBLE VALUE CREATION Serving, helping and collaborating with customers, suppliers, the seafarer community and other stakeholders to support a responsible and resilient supply chain and PB community Employee Safety, Security, Health & Wellbeing Carbon & GHG Emissions Reduction Diversity, Equity & Inclusion Good Management & Corporate Governance Responsible Business Practices & Cargo Carriage In 2024-2025, we have been and continue to conduct internal workshops to tighten up our vision, ambitions, goals and targets for all five of our priority ESG issues. These collaborative exercises provide a valuable opportunity for deeper engagement with our colleagues on these topics and provide a forum for refining and updating our ESG strategies, while empowering our colleagues to tailor initiatives to achieve our goals & targets and further embedding sustainability in our culture. ESG Please see our standalone Sustainability Report 2024 for a full review of our sustainability approach and performance ‌Sustainability & Governance 26 ENVIRONMENTAL RESPONSIBILITY Ambition: As a leading dry bulk ship owner and operator, Pacific Basin seeks to further improve our fleet scale, optimise our performance and offer flexible and reliable service while striving to decouple this from environmental impact. We operate in a heavily regulated industry and take responsibility for decarbonising our fleet, managing our waste, marine discharges and resources consumption, ensuring our ships are primed for proper recycling and minimising our biodiversity impacts as we continue to grow our business. The most challenging priority of our environmental programme is the gradual decarbonisation of our fleet for compliance and to achieve our IMO-aligned net zero by 2050 target. IMO Agrees to Framework for Global GHG Reduction Rules In April, the IMO approved a Global Fuel Standard (GFS) with economic elements. This two-tiered GFS is designed to drive a phased reduction in GHG Fuel Intensity (GFI) by forcing the gradual adoption of green fuels to meet yearly well-to-wake (WTW) GFI targets. The GHG intensity reduction targets will tighten annually from 2028 to 2035. The targets for 2036-2040 will be determined by January 2032. The base target for 2040 is set to be a 65% reduction compared to 2008 levels. These targets are compared against 2008 levels, with the reference GFI being 93.3g CO 2 e/MJ. Compliance penalties & benefits: Base Target deficit requires purchase of Remedial Units (RUs) at US$380 pmt CO 2 e Direct Compliance Target deficit requires purchase of RUs at US$100 pmt CO 2 e Over-compliance with Direct Compliance Target generates Surplus Units (SUs) that can be sold or pooled (offsetting ships in carbon deficit) or banked for up to 2 years Deep GFI reductions made possible by Zero or Near Zero emission (ZNZ) fuels will receive financial rewards (funded by Remedial Unit payments to IMO Net Zero Fund), but the reward value will only be determined in 2027 (ZNZs mean ≤19 gCO 2 e/MJ until end 2034, then ≤14 gCO 2 e/MJ) IMO Net Zero Fund will need to cover ZNZ rewards and Just & Equitable Transition initiatives. Funding available to incentivise ZNZ fuels should run into US$ several billion annually GFS is expected to be adopted in October 2025 with entry into force by 2027 Our Decarbonisation Strategy We take a multi-pronged approach to reducing our carbon intensity to comply with IMO's global decarbonisation regulations as well as EU and other regional rules. Prioritising Green Fuel Sourcing Having made our first commitment to ordering dual-fuel LEVs in November 2024, we signed a Memorandum of Understanding (MOU) with The Hong Kong and China Gas Company Limited (Towngas) in June 2025 to enhance our access to volumes of green methanol marine fuel. Our agreement with Towngas marks a key milestone in our long-term plan for green fuels to make up 5% of our fuel mix by 2030 and for our fleet to achieve net zero emissions by 2050. Alongside sustainable biofuel, green methanol will become an increasingly important part of Pacific Basin's marine fuel mix as we grow our fleet of dual-fuel methanol-capable LEVs and decarbonise our operations to comply with increasing maritime decarbonisation regulations. Green methanol will support our dual-fuel LEVs which can flexibly switch between conventional fuel oil, sustainable biofuel and green methanol based on the prevailing economics. The IMO's GFS should strengthen the business case for early adoption of LEVs and low-carbon fuels. Energy-efficient technology adoption Carbon-efficient operational measures Fleet renewal and growth for energy efficiency Investment in Low-Emission Vessels (LEVs) Developing access to green fuels ESG Sustainability Report 2024 p.17 Our Decarbonisation Strategy RESPONSIBILITY TO OUR PEOPLE Sustainability & Governance 27 Ambition: Pacific Basin strives to develop a diverse, effective and motivated team. At sea and on shore, we continue to uphold the highest health and safety standards and train our colleagues to enable them to tackle evolving business challenges while looking after their, and each other's, overall wellbeing. We want to encourage and support each individual's unique efforts to contribute to our business and to remove barriers to inclusion and opportunity. Enhancing Security Drug smuggling by cartels and militant activity are risks currently faced by our ships and colleagues at sea. We prioritise the safety and security of our colleagues, our ships and our operations, and practice proactive vigilance and risk management in times of heightened security threats. When navigating through high-risk areas, we have implemented the following enhanced security measures: In-house Security Team Established in 2025 We recently established a Global Security Operations Centre (GSOC), a new strategic capability designed to enhance the security, resilience and situational intelligence awareness of our global dry bulk shipping operations. PB GSOC will serve as our central hub for monitoring global security events, intelligence and physical security management, routinely coordinating intelligence-led operational security risk and guidance across our whole-fleet (seafarers and our owned and chartered vessels) and office network. This initiative marks a significant milestone in our company's continued commitment to operational security and crew protection. Global Security Operations Centre (GSOC) Voyage risk assessments Dog searches Security guards Patrol boats AI-integrated CCTV Underwater drone searches Gangway turnstile Turnstile with facial recognition technology Perimeter camera Barbed wire fencing Underwater Remote Operate Vehicles (ROVs) Radio Frequency Identification Security (RFID) locks & seals Enhancing Wellbeing Some of our recent seafarer wellbeing initiatives include: Starlink and Inmarsat's Low Earth Orbit (LEO) NexusWave internet services to provide high-speed connectivity with unlimited data and global coverage service Training for all our Crewing Assistants in Manila and Dalian to identify signs of distress amongst our crews when communicating with them during their tenure onboard Training for all our ships' Masters in the good management of any cross-cultural issues and conflicts onboard Participation in the SAFETY4SEA SEAFiT Crew Welfare Survey to assess our overall crew wellness index and identify key challenges faced by crew which helps support the development of an enhanced mental wellbeing programme for our seafarers Enhancement of our Wellness at Sea Manual and training covering a range of mental wellbeing topics to raise awareness across our fleet Additional psychometric screening tests for all seafarers prior to joining our vessels Lost Time Injury Frequency (LTIF) 0.52 4% injuries per million man hours Seafarer overall engagement 86% In the first half of 2025, our crews registered 9 recordable injuries (including 5 lost-time injuries) in over 9.5 million man hours, mostly arising from relatively minor falls, burns and finger injuries. In the first half of 2025, we engaged independent consultants to conduct our first seafarer engagement survey, the results of which pointed to a high level of satisfaction and engagement across several main criteria and provided useful insight into areas that may benefit from extra attention. Zero LTIF Rate 95% of PB owned ships achieved zero LTI injuries in 1H2025 0 Harassment and Bullying Cases ESG Please see our standalone Sustainability Report 2024 for a review of how we invest in our people's security, safety, wellbeing and engagement Sustainability & Governance 28 RESPONSIBLE VALUE CREATION Ambition: Pacific Basin is in it for the long haul, valuing long-term relationships over short-term gains with our customers, suppliers, investors, finance providers, regulators, local communities and other networks. Leveraging our scale and influence in the dry bulk industry, we seek to promote a responsible, ethical, inclusive and resilient global marketplace by working together with our stakeholders. Serving our Customers Serving our People Serving our Shareholders Serving Society Serving Sustainable Trade Serving the Environment Examples of collaborations with our stakeholders in first half 2025 Please see our Sustainability Report 2024 for a review of how we create value responsibly ESG We regularly gather with peers to exchange ideas and insights on various sustainability topics through "Sustainability in Shipping" meetings. In January, we discussed our order for four dual-fuel Ultramax LEVs capable of running on green methanol, biofuel and fuel oil. In May, we focused on ship security, including anti-smuggling, anti-piracy and crew safety measures. In April, our Sustainability Manager spoke at the Hong Kong Chamber of Shipping's Guangdong-Hong Kong-Macao Clean Energy Supply Chain Conference attended by over 200 maritime industry professionals and government representatives, sharing his thoughts on IMO MEPC 83 outcomes, Pacific Basin's decarbonisation efforts and our early investment in dual-fuel green ships. Pacific Basin sponsored the "Network by the Sea" event, organised by the Hong Kong Maritime Museum which brought together young professionals from the shipping industry, the arts and other local businesses as well as CSR partners inspiring cross-sector conversations. To celebrate the International Day of the Seafarer, we sponsored free admission to the Hong Kong Maritime Museum in June. Over 3,600 visitors enjoyed many interactive offerings, including games, guided tours, a bridge simulator experience, as well as career experience sharing and knot-tying and navigation workshops led by Pacific Basin ship officers, cadets, shore-based managers and former ship captains. We participated in an industry seminar organised by the Women's International Shipping & Trading Association and the Nautical Institute to discuss topics around Diversity, Equity & Inclusion among seafarers and proposals for green incentives within the industry. In July, we successfully concluded our second sustainability-linked 7-year secured revolving credit facility of US$250 million, with interest margin adjustments linked to our carbon intensity (EEOI) and crew safety (LTIF) performance, which are among our top ESG priorities.

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