Q2 2024 Euronav NV Earnings Call
Speaker Change: It's could seem you wouldn't come as use as they come to use.
unknown: Susan Nance has prepared a number of idrotas yet.
Speaker Change: He isn't asking for you, you don't have to do it.
Speaker Change: Let's peek a bit.
Speaker Change: Do you want to test whether you can hear us?
Speaker Change: Welcome everyone.
Speaker Change: Yeah, yeah.
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Speaker Change: Yeah, now the mic is on. Good.
unknown: [inaudible]
Speaker Change: Welcome everyone. So apologies for a one minute delay. We're just testing the sound. So I hope you can hear us. Welcome to this Q2 2024 earnings release.
unknown: Unknown Executive, Joris Daman, Liesbeth Verhaert, Roy Campe, Willem Wel, Alexander
unknown: Do you want to test whether you can hear us? So, welcome everyone, welcome everyone, welcome everyone. Yeah.
unknown: Welcome everyone. So apologies for the one minute delay. We're just testing the sound. So I hope you can hear us.
Alexander Saverys: I'm joined here today by our CFO Ludovic Saverys, my name is Alexander Saverys, I'm the CEO of CMB Tech.
Alexander Saverys: Welcome to this Q2 2024 earnings release. I'm joined here today by our CFO, Ludovic Saverys. My name is Alexander Saverys. I'm the CEO of CMB Tech. And the topics of today's...
Alexander Saverys: And the topics of today's call...
Alexander Saverys: will be a financial highlight, first of all, of the quarter.
Alexander Saverys: Also highlighting everything we have done during the quarter and then we will zoom in on all our marine divisions, division per division and give you a marked outlook to finish off with a conclusion and a Q&A.
unknown: If you have seen the press release this morning, you will see that the heading was Transforming the Future.
Alexander Saverys: If you have seen the press release this morning, you have seen that the heading was transformation in full swing.
Alexander Saverys: and indeed our company is in full transformation. We've had an incredibly busy second quarter, ratifying the name change from Euronav to CMB Tech. The ticker symbol has already changed.
Alexander Saverys: The real name change will take place on the 1st of October , but meanwhile doing a lot of business.
Alexander Saverys: adding a contract backlog to our already large contract backlog. We have ordered new vessels, we have sold older tankers, we have taken delivery of many, many ships.
Alexander Saverys: and last but not least we have also concluded our partnership with Anglo Eastern. So a lot to talk about and I would like to hand over to Ludovic for the financials.
Ludovic Saverys: Thanks, Alexander. Focusing on the Q2 figures, we are happy to announce that we had another strong quarter with a net profit of 184 million. This brings the half-year profits to close to $680 million. Taking the last 12 months, we will conclude this $1.2 billion profit if we start from Q3 until today. Adjusted for capital gains, there have been quite a lot of capital gains.
Ludovic Saverys: Thanks, Alexander.
Ludovic Saverys: Focusing on the Q2 figures, we are happy to announce that we had another strong quarter with a net profit of 184 million.
Ludovic Saverys: This brings the half year profits to close to 680 million dollars.
Speaker Change: taking the last 12 months.
Ludovic Saverys: We will conclude this $1.2 billion profit if we start from Q3 until today. Adjusted for capital gains, there have been quite a lot of capital gains as you all know. The Q2 profit ends at roughly $70 million.
Ludovic Saverys: As you all know, the Q2 profits ended at roughly $70 million. Apart from the strong operational results, we were also happy to pay a dividend of $4.57, and declare another dividend of $1.15 in Q2 that was paid in early Q3, bringing the total dividends and distribution for the half year to $5.72. We ended the month of June with $420 million in liquidity. The contract backlog that Alex has mentioned stands today at roughly $2.1 billion of contracted revenue. Forward revenue Whereas the outstanding CAPEX from the end of Q2 stands at $2.7 billion, it is roughly $900 million every 12 months going forward.
Ludovic Saverys: Apart from the strong operational results, we were also happy to pay a dividend of $4.57.
Ludovic Saverys: Declare another dividend of $1.15 in Q2 that was paid in early Q3. Bring the total dividends and distribution for the half year $5.72.
Alex: We ended the month of June with $420 million in liquidity. The contract backlog that Alex has mentioned stands today at roughly $2.1 billion of contracted revenue, forward revenue, whereas the outstanding CAPEX...
Alex: From end of Q2 stands at 2.7 billion dollars. It is roughly 900 million dollars every 12 months going forward.
Ludovic Saverys: And last but not least, in the first half year, we concluded a share buyback program of 8 million shares for roughly $126 million. Continuing on that, as Alexander mentions, we had a delivery in Q2 and the last couple of weeks of seven new building vessels, which is a continuation of the large new building program we have. On delivery, we sold the CMA CGM Baikal, which is a container vessel. Additionally, we were able to successfully complete the sale of Euronav Ship Management to Anglo Eastern.
Ludovic Saverys: And last but not least, in the first half year, we concluded a share buyback program of 8 million shares for roughly 126 million dollars.
Ludovic Saverys: Continuing on that, as Alexander mentioned, we had a delivery in Q2 and in the last couple of weeks of seven new building vessels. That is a continuation of the large new building program we have. Continuing to the next slide, where we show, as we have previously in earnings calls, what fleet we have today on the water, with 38 tankers, 6 Newcastle Maxis, 4 container vessels, actually, now since yesterday, 54 workboats, four chemical thinkers, and three ferries and tugboats.
Ludovic Saverys: Continuing on that, as Alexander mentioned, we had a delivery in Q2 and the last couple of weeks of seven new building vessels. That is a continuation of the large new building program we have.
Alexander Saverys: We sold the CMA CGM by car, which is a container vessel, upon delivery.
Speaker Change: We were able to successfully complete the sale of Euronav Ship Management to Anglo Eastern and that was concluded in a Q2 bringing an external profit of $20 million.
Ludovic Saverys: That was concluded in Q2, bringing an external profit of $20 million. The successful completion of the three VLCCs that were earlier announced got concluded in Q2 as well, bringing a capital gain of $79 million. The LZES is another VLCC we sold.
Alexander Saverys: The successful completion of the three VLCCs that were earlier announced got concluded in Q2 as well, bringing a capital gain of $79 million.
Ludovic Saverys: So the MOA has been signed, but the delivery will happen in Q1 2025 with a nice profit as well. On the new business, we've added one more CSOV to our elevation series, the future-proof elevation series, which is number six in the series, and another two hydrogen-powered CTVs. Previously announced as well, we have signed a collaboration agreement with Diamond Shipyards for building four hydrogen-powered tugboats. Continuing to the next slide, where we show, as we have done in previous earnings calls, what fleet we have today on the water with 38 tankers, 6 Newcastle Maxis, 4 container vessels, actually now, since yesterday, 54 workboats. Four chemical thinkers and three ferries and tugboats.
Alexander Saverys: The LZES is another VLCC we sold, so the MOA has been signed but the delivery will happen in Q1 2025 with a nice profit as well.
Alexander Saverys: On the new business, we've added one more CSOV to our elevation series, the future-proof elevation series, which is number six in the series, and another two hydrogen-powered CTVs.
Alexander Saverys: Previously announced as well, we have signed a collaboration agreement with Diamond Shipyards for building four hydrogen-powered tugboats.
Alexander Saverys: Continue to the next slide, where we show, as previously in earnings calls, what fleet we have today on the water, with 38 tankers, 6 Newcastle Maxxis, 4 container vessels actually now since yesterday, 54 workboats.
Ludovic Saverys: On the right side, you can see that this will continue to grow, the total fleet on the water, to reach 117 vessels at the end of this year, 136 vessels at the end of 2025, and to come close to 160 vessels at the end of 2026. Zooming in on the P&L figures as previously shown, we want to highlight here, without going into too much detail, that for Q2, we were profitable in every single segment and that the Q3 quarter-to-date results are still very positive. Alex will continue, segment by segment, to explain this.
Alexander Saverys: four chemical tankers and three ferries and tugboats. On the right side you can see that this will continue to grow, the total fleet on the water to reach 117 vessels end of this year, 136 and then 25 to come close to 160 vessels end of 26.
Ludovic Saverys: Zooming in on the P&L figures as previously shown, we want to highlight here without going into too much detail that for Q2, we were profitable in every single segment and that the Q3 quarter-to-date results are still very positive. Alex will continue segment by segment to explain this.
Alexander Saverys: Zooming in on the P&L figures as previously shown, we want to highlight here, without going into too much detail, that for Q2
Alexander Saverys: We were profitable in every single segment and that the Q3 quarter-to-date results are still very positive. Alex will continue segment by segment to explain this.
Ludovic Saverys: The contract backlog, as we've shown and discussed, we've added $161 million in additional long-term contracts on Suez Maxx New Building, Suez Maxx Underwater, and another chemical tanker, which for delivery in Q126 is on a seven-year charter to Ultratank. This is our commitment that a lot of our clients like to work with our future professors, and hopefully, we can increase this contract backlog in the months to This slide, again, is to show that while we are building a long-term contract backlog on some modern assets, we're still very much spot-exposed.
Alex: The contract backlog, as we've shown and discussed, we've added $161 million of additional long-term contracts on Suez Max New Building.
Alex: Suizmaxx on the water and another chemical tanker which forward delivery in the Q126.
Speaker Change: is on seven-year charter to Ultratank. This is our commitment that a lot of our clients like to work with our future professors and hopefully we can increase this contract backlog in the months to come.
Alexander Saverys: This slide again is to show that while we are building a long-term contract backlog on some modern assets, we're still very much spot exposed.
Ludovic Saverys: We still have 75% of open days for 2024. This goes to 80% in 2025. And when you can see in 2026, we end the year with a total of 30,000 shipping days, where the biggest, obviously, spot exposure is in our dryboat division and also our tanker division. I'll pass on the word to Alexander, who can continue to go into the various segments. Yeah.
Alexander Saverys: We have still 75% of open days for 2024, this goes to 80% in 2025, and you can see in 2026 we end of the year with a total days of 30,000.
Alexander Saverys: of the shipping days where the biggest obviously spot exposure is in our driveboat division and also our tanker division.
Alexander Saverys: I'll pass on the word to Alexander who can continue to go into the various segments.
Alex: Yeah, thanks Ludovic. Let's start with the tankers. Still today, our biggest division. We have put some numbers on there that you saw in the previous slide, but split between the VLCCs and the Swissmaxes. You will see that in the second quarter we equaled roughly $50,000 a day on the VLCC spot market, close to $50,000 as well on the Swissmax spot market, and for Q3 to date, we have fixed 61% of our Vs at $34,000 and about half of our Swissmaxes at $41,000.
Alexander Saverys: Yeah, thanks Ludovic. Let's start with tankers, still today our biggest division.
Alexander Saverys: Thanks, Ludovic.
Alexander Saverys: Let's start with tankers, still today our biggest division.
Alexander Saverys: We have put some numbers on there that you saw on the previous slide, but split between the VLCCs and the Swissmaxes. You will see that in the second quarter, we equaled roughly $50,000 a day on the VLCC spot market, and close to $50,000 as well on the Swissmax spot market. And for Q3 so far, we have fixed 61% of our Vs at $34,000, and about half of our Swissmaxes at $41,000, which, even with the seasonal slowdown that we are seeing this summer, are still very good rates.
Alexander Saverys: We have put some numbers on there that you saw in the previous slide that split between the VLCCs and the SWISM axis.
Alexander Saverys: You will see that in the second quarter, we equaled roughly $50,000 a day on the VLCT spot markets.
Alexander Saverys: Close to 50,000 as well on the Swiss Max spot market.
Alexander Saverys: And for Q3 to date, we have fixed 61% of our Vs at 34,000 and about half of our Suisse Maxis at 41,000. Which, even with the seasonal slowdown that we are seeing this summer, are still very good rates.
Alex: On the activity, we mentioned the two new charters that we have signed, one for our new building, Suez Maxis, for five years, and one two-year contract on the Fraternity, which is a 2009 Suez Max. We have completed the sale of our three N-type VLCCs in the second quarter with a capital gain of 79 million.
Alexander Saverys: On the activity, we mentioned the two new charters that we have signed, one for our new building, Suez Maxis, for five years, and one two-year contract on the Fraternity, which is a 2009 Suez Max. We have completed the sale of our three N-type VLCCs in the second quarter with a capital gain of 79 million.
Alexander Saverys: On the activity, we've mentioned the two new charters that we have signed, one for our new building Suez Maxis for five years, one two-year contract on the Fraternity, which is a 2009 Suez Max.
Alexander Saverys: We have completed the sale of our three N-type VLCCs in the second quarter with a capital gain of 79 million. We also signed an MOA on the sale of the VLCC Alsace, which will deliver in Q1 next year.
Alex: We also signed an MOA on the sale of the VLCC Alsace, which we'll deliver in Q1 next year. We have a snapshot here of where the market is. You can see that the earnings are definitely above average and healthy rates compared to the last 10 years. A lot of green lights when we look at the demand indicators, but some red lights as well. It will come as no surprise to you that the oil supply from OPEC is not positive, definitely not for the VLCCs.
Alexander Saverys: We also signed an MOA on the sale of the VLCC Alsace, which we'll deliver in Q1 next year. And then, obviously, just maybe go back, one last point I wanted to mention is that, recapping, we still have five new ammonia-powered eco-VLCCs on order, and apart from the two Suez Maxxes that we are delivering this year, we have another two coming in 2026. We have a snapshot here of where the market is. You can see that the earnings are definitely, compared to the last 10 years, above average and healthy rates.
Alexander Saverys: And then, obviously, just maybe go back, one last point I wanted to mention is that, recapping, we still have five new ammonia-powered eco-VLCCs on order, and apart from the two Suez Maxxes that are delivering this year, we have another two coming in 2026. You can go to the next slide.
Alexander Saverys: We have a snapshot here on where the market is. You can see that the earnings are definitely compared to the last 10 years above average and healthy rates.
Alexander Saverys: A lot of green lights when we look at the demand indicators, but some red lights as well.
Speaker Change: will come as no surprise to you that the oil supply from the OPEC is not a positive, definitely not for the VLCCs.
Alex: We see that China's oil imports year on year are a little bit down. But all in all, if we combine some of the positive demand signals with the very low order book coming on stream, we are still in a very healthy supply-demand environment. Next slide.
Alexander Saverys: We see that the China oil imports year on year are a little bit down. But all in all, if we combine some of the positive demand signals with the very low order book coming on stream, we are still in a very healthy supply-demand environment.
Alexander Saverys: Here we have basically tried to make a theoretical assumption if we scrap all vessels that are older than 25 years, how would the fleet evolve, and then put the expected growth, and the growth numbers are coming from organizations like the IEA, and what would that give. And basically, all the way up to 2028, if we scrap ships that are 25 years old and older, on the V's, we would lose 10% of the fleet; on the Swiss Maxis, it would be 2 to 2.5%, so the fleet would be in decline if, again, all these ships were scrapped. What happens on the demand side is that you can see that peak oil is not there yet; we still see growth in demand, and all the agencies are still forecasting some growth in demand.
Alexander Saverys: Next slide.
Alexander Saverys: Here we have basically tried to make...
Alexander Saverys: a theoretical assumption
Alexander Saverys: If we would scrap...
Alexander Saverys: all vessels that are older than twenty-five years how the fleet evolve and then put the expected growth and the growth numbers are coming from organizations like the ia and what would that give
Alexander Saverys: and basically all the way up to 2028 if we would scrap ships that are 25 years and older on the Vs we would lose 10% of the fleet.
Alexander Saverys: On the Swiss Maxis it would be 2 to 2.5%, so the fleet would be in decline if again all these ships would get scrapped. What happens on the demand side is that you can see that peak oil is not there yet. We still see growth in demand and all the agencies are still forecasting some growth in demand. That means that we will need...
Alexander Saverys: in the tanker industry for the next five years, more tankers. And when we look at the order book, the order book is still relatively low. We have seen some new orders. But again, according to this model, we would see that we are in structural shortage of ships, which should bode well for our markets going forward in the next years.
Alexander Saverys: We go to the dry-build division, which is a rapidly growing division. You have seen that we have taken delivery of new vessels. We have six Newcastle Maxxes on the water now, and still another four will come on stream this year. And we have, in total, 28 new buildings for the next couple of years coming on the water. Our earnings were very good in the second quarter. You can see it there. We had $36,000 earnings on our Newcastle Maxxes. The third quarter was a bit softer, but they still earned more than $30,000.
Alex: We go to the dry-build division, which is a rapidly growing division. You have seen that we have taken delivery of new vessels. We have six Newcastle Maxxes on the water now, and still another four will come on stream this year.
Alexander Saverys: Next slide.
Speaker Change: We go to the dry build division, which is a rapidly growing division, you have seen that we have taken delivery of new vessels, we have 6 new Castlemaxes on the water now, still another 4 will come on stream this year, and we have in total 28 new buildings for the next couple of years coming on the water.
Alex: And we have, in total, 28 new buildings for the next couple of years coming on the water. Our earnings were very good in the second quarter. You can see it here.
Alex: We had $36,000 earnings on our Newcastle Maxxes. The third quarter was a bit softer, but still earning more than $30,000. It's active, as I said, on the delivery side. The growth is driven, I'll show you in a couple of slides, by different dynamics in the market. But all in all, we can definitely not complain about BOSIMAR, our dry-build division.
Speaker Change: Our earnings were very good in the second quarter. You can see it there. We had $36,000 earnings on our Newcastle maxis. The third quarter was a bit softer, but still earning more than $30,000.
Alexander Saverys: It's active, as I said, on the delivery side. The growth is driven, as I'll show you in a couple of slides, by different dynamics in the market. But all in all, we can definitely not complain about Bossiemar, our dry-build division. I go to the next slide.
Speaker Change: it's active as i said on the delivery sides the growth is driven i'll show you a couple ofslides by different dynamics in the marketts but all in all we can definitely not complained for boim our dri division and good next nightide
Alex: On the demand side, you can see positive indicators coming from China, definitely in the first half, but there's still a year on year July as well on iron ore imports, coal imports, Brazil and Australia still exporting more. There are, of course, some signals that are a little bit more worrisome when we look at steel production in China, steel inventories, and iron ore inventories, which are all up and should normally signal a rather weaker market.
Alexander Saverys: On the demand side, you can see positive indicators coming from China, definitely in the first half, but there's still a year on year July as well on iron ore imports, coal imports, Brazil and Australia still exporting more. There are, of course, some signals that are a little bit more worrisome when we look at steel production in China, steel inventories, and iron ore inventories, which are all up and should normally signal a rather weaker market.
Speaker Change: Indicators on the demand side, you can see them on the screen. Positive indicators coming from China definitely in the first half, but still year-on-year July as well on iron ore imports, coal imports.
Speaker Change: Brazil and Australia are still exporting more.
Alexander Saverys: there are of course some signals that al in with more worrisome when we look at the steam production in china the seenam inventoes and the r no inventories that are all up and should normally signal rather weaker market but
Alex: But compared to the growth in the fleet, overall, the dry block markets are still very healthy; demand is growing faster than the supply of the fleet. I want to finish off with offshore wind, that's our little CTVs. We have six CSOVs on order. One CSOV was added to our order book in the second quarter. Our CSOVs are not fixed yet, but the CTVs are running on a mixture of spot and time charter business.
Alexander Saverys: But compared to the growth in the fleet, overall, the dry bulk markets are still very healthy; demand is growing faster than the supply of the fleet. Two things I want to highlight today are the age of the cape sizes and then the new projects in Western Africa. Starting with the cape sizes, you see the age profile here of all the capes.
Speaker Change: Compared to the growth in the fleet, overall the dry book markets are still very healthy. Demand is growing faster than the supply of the fleet.
Speaker Change: Two things I want to highlight today is the age of the cape sizes and then the new projects in Western Africa, starting with the cape sizes.
Alexander Saverys: If you fast forward to 2030, you will see that by then more than 800 capes will have reached the age of 20 years. By that date, more than two-thirds, even three-quarters of the fleet will have reached the age of 15 years. But I think we're focusing on this full special survey, the 20-year deadline, 800 ships by 2030. Look at the order book, which is still relatively low. It's 125 Cape Salsas and Newcastle Maxis. This, again, from a supply point of view, an aging fleet, and a low order book, should definitely be supported for our markets going forward. The next one.
Speaker Change: You see the age profile here of all the capes. If you fast forward to 2030, you will see that by then, more than 800 cape sizes will have reached the age of 20 years.
Speaker Change: By that date, more than two-thirds, even three-quarters of the fleet will have reached the age of 15 years.
Speaker Change: But I think we're focusing on this full special survey, the 20-year deadline, 800 ships by 2030.
Speaker Change: Look at the order book, which today is still relatively low. It's 125 Cape Salsas and Newcastle maxes. This again, from a supply point of view, an aging fleet, a low order book, should definitely be supported for our markets going forward.
Alexander Saverys: On demand, I wanted to highlight in this call one specific new project which has been talked about for many years but which is finally coming on stream. It's the Simandou project in Guinea, which is basically two consortia that will start exporting iron ore, starting ramping up this year, next year, and then all the way up to 2028, coming fully on stream, going to 120 million tons of iron ore per year, which is expected to go, nearly all of it, to China. What does that mean in the bigger scheme of things?
Speaker Change: The next one.
Alexander Saverys: It means that by 2028, we might need only 170 vessels for the Simandou project. I just spoke about the order book. This demand signal should again be a very good and positive signal for the market. You can also see why the distance is twice the distance between, for instance, Australian iron ore. Of course, we are highlighting as well that there's a very nice little bunkering station that will be ready to supply ammonia in Namibia, which sits on that trade route.
Speaker Change: On the demand, I wanted to highlight in this call one specific new project which has been talked about for many years, but which is finally coming on stream, it's the Simandou project in Guinea.
Speaker Change: which is basically two consoria that will start exporting ironore
Speaker Change: starting ramping up as from this year next year and then all the way up to 2028 coming fully on stream going to 120 million tons per year of iron ore exports which are expected to go nearly all of it to China.
Speaker Change: What does that mean in the bigger scheme of things? It means that by 2028, we might need, only for the Simandou project, an extra 170 vessels.
Speaker Change: I just spoke about the order book. This demand signal should again be a very good and positive signal for the market. You can also see why the distance is twice the distance than, for instance, Australian iron ore.
Speaker Change: And of course we are highlighting as well that there is a very nice little bunkering station that will be ready to supply ammonia in Namibia which sits on that trade route. So very interesting for CMB Tech and for our BOSIMAR division to watch this CMONDO project.
Alexander Saverys: So, very interesting for CMB Tech and for our BOSIMAR division to watch this Simandou project. A couple of words on the chemical tanker business; the chemical tanker business, like the product tanker business and the crude tanker business, is doing well. There is healthy demand that we are seeing in the market, but the supply of vessels is limited. It is, of course, a less volatile market than the crude oil markets. Our exposure in Bochem, which is our chemical tanker division, has been fixed.
Speaker Change: Next slide.
Speaker Change: A couple of words on the chemical tanker business.
Speaker Change: The chemical tanker business, like the product tanker business and the crude tanker business, is doing well. There's healthy demand that we are seeing in the market. The supply of vessels is limited. It is, of course, a less volatile market than the crude oil markets.
Alexander Saverys: The one that we announced in our press release is this new charter for seven years to Ultratank for one of our new buildings delivering beginning in 2026. The sister vessel will go in the Ultratank pool, which will bring our fleet of 10 vessels to seven ships fixed and three spots.
Speaker Change: Our exposure in BOCHEM, which is our chemical tanker division, has been fixed. The one that we announced in our press release is this new charter for seven years to Ultratank for one of our new buildings delivering beginning 2026. The sister vessel will go in the Ultratank pool, which will bring our fleet.
Alexander Saverys: Of course, in Bochem, we also have our two product bitumen tankers as well. You can see the break-even rates, which are giving us very good returns on the spot market and a decent return for our charters. Next slide.
Speaker Change: of ten vessels to seven ships fixed and three spot of course in book and we also have our two products bitand tankers as well you can see the break ven rates which are giving us very good returns on the spot market and a decent return for our charges
Alexander Saverys: The container market is one of our smaller divisions. As Ludovic said, we took delivery of the fourth container vessel in our fleet. We still have one new building on order for July 2026.
Speaker Change: Next slide.
Speaker Change: the container markets as one of our smaller divisions as we said we took delivery of the fourth container sel in our fet we still have one new building on order in july two thousand and twenty six
Alexander Saverys: All our vessels are fixed at very good rates and will contribute very helpfully to our net profit. But if you look at the market in general, there are some very negative indicators. I would definitely say the container fleet order book is huge, which usually doesn't bode well for our markets. The demand indicators are a mixed bag. There are some good, some bad.
Speaker Change: All of this is all fixed at very good rates and will contribute very helpfully to our net profit But if you look at the market in general there's
Speaker Change: Some very negative indicators, I would say definitely the container fleet order book is huge, which usually doesn't bode well for our markets.
Alexander Saverys: But the big game changer in the container market is obviously what is happening in the Red Sea. As you can see at the bottom of this slide on the right, Container Ship Suez Canal transit numbers in TU have gone down by more than 90% year on year. So you can see that the disturbance there is huge, and it's having a massive impact on tonne mile demand growth. You can see, year on year, we are 16% higher in tonne miles than last year in July. Nobody knows how long it will last, but what is sure is that it has lasted for a lot longer than people expected.
Speaker Change: The demand indicators are a mixed bag, there's some good, some bad, but the big game-changer in the container market is obviously what is happening in the Red Sea. As you can see at the bottom of this slide on the right, container ship Suez Canal transit numbers in TU have gone down by more than 90% year-on-year. So you can see that the disturbance there is huge and it's having a massive impact.
Speaker Change: on ton-mile demand growth. You can see year-on-year, we are 16% in ton-miles, higher than last year in July . Nobody knows how long it will last.
Speaker Change: What is sure is that it lasted for a lot longer than people expected, and I don't think we see an end in sight in the coming months, unfortunately.
Alexander Saverys: And I don't think we see an end in sight in the coming months, unfortunately. I want to finish off with offshore wind, our little CTVs. We have six CSOVs on order. One CSOV was added in the second quarter to our order book. Our CSOVs are not fixed yet, but the CTVs are running on a mixture of spot and time charter business.
Speaker Change: I want to finish off with offshore wind. That's our little CTVs. We have six CSOVs on order. One CSOV was added in the second quarter to our order book. Our CSOVs are not fixed yet, but the CTVs are running on a mixture of spot and time charter business. You can see the break-even rates and what we have earned in the second quarter and in the third quarter is doing very nicely. The offshore wind market and we are seeing some good demand indicators again this year. New projects coming on stream, more demand for offshore wind supply vessels.
Alex: You can see the break-even rates and what we earned in the second quarter and in the third quarter are doing very nicely. The offshore wind market, and we are seeing some good demand indicators again this year, new projects coming on stream, and more demand for offshore wind suppliers. An overview of our fleet list, which you can read at your leisure. The presentation is on our website with the detailed delivery dates of the order book. And I'm basically moving to the conclusion and then opening the floor to you for some questions.
Alexander Saverys: You can see the break-even rates and what we earned in the second quarter and in the third quarter are doing very nicely. The offshore wind market, and we are seeing some good demand indicators again this year, new projects coming on stream, and more demand for offshore wind suppliers. I'm summing this up on this last slide. We have decided that this would be a recurring slide that we would show you every quarter, our assessment of where we are in the traffic light. And you can see that all the lights are green.
Speaker Change: I'm summing this up in this last slide we have decided that this would be a recurring slide and we would show you every quarter our assessments on where we are the traffic lights
Alexander Saverys: I did tell you why we believe that. It is basically the balance between demand and supply. And in every sector where we are active as CMB Tech, we see a good supply-demand balance, which is generating good results. At the bottom, you can see our exposure. You see, on the tanker side, in the Euronav division, we have about one quarter of our vessels which are fixed on time charter. The rest are trading spots. The dry bulk, everything so far is spots.
Speaker Change: and you can see that all the lights are green. I did tell you why we believe that. It is basically the balance between demand and supply and in every sector where we are active as CMB Tech, we see a good supply-demand balance, which is generating good results.
Speaker Change: At the bottom you can see our exposure, you see on the tanker side, Euronav division, we have about one quarter of our vessels which are fixed on time charter, the rest is trading spots, the dry bulk, everything so far is spots, containers, everything is charted.
Alexander Saverys: Containers, everything's charted. Chemical tankers are 70% charted, 30% on the spot market. And on our offshore winds, apart from our CTVs, the six CTVs we have are still spots that have not been fixed, but the first one is only delivering next year in Q2. Let's go to the next slide. An overview of our fleet list, which you can read at your leisure. The presentation is on our website with the detailed delivery dates of the order book.
Speaker Change: Chemical tankers is 70% chartered, 30% on the spot market, and on offshore winds, apart from our CTVs, the six CSOVs we have are still spot, have not been fixed, but the first one is only delivering next year in Q2. Let's go to the next slide.
Speaker Change: An overview of our fleet list which you can read at your leisure, the presentation is on our website with the detailed delivery dates of the order book.
Alexander Saverys: And I'm basically moving to the conclusion and then opening the floor to you for some questions. Our shareholders, I think, should be happy. We have paid a very nice dividend over the first half, thanks to the exceptional profits that we made after the sale of our VLCCs to Frontline. We still made a very nice profit in the second quarter of $184 million.
Speaker Change: And I'm basically moving to the conclusion and then opening the floor to you for some questions.
Alex: Our shareholders, I think, should be happy. We have paid a very nice dividend in the first half, thanks to the exceptional profits that we made after the sale of our VLCCs to Frontline. We still made a very nice profit in the second quarter of $184 million. You know that we are committed to remaining listed on the Brussels Stock Exchange and in New York. We recently changed our ticker symbol to CMBT. The name change of the company will take place on the 1st of October, so Euronav will become CMBTech, and then the Euronav name will be our division.
Speaker Change: Our shareholders, I think, should be happy. We have paid a very nice dividend over the first half, thanks to the exceptional profits that we made after the sale of our VLCCs to Frontline. We still made a very nice profit in the second quarter of $184 million.
Alexander Saverys: You know that we are committed to remaining listed on the Brussels Stock Exchange and in New York. We recently changed our ticker symbol to CMBT. The name change of the company will take place on the 1st of October, so Euronav will become CMBTech, and then the Euronav name will be our division.
Speaker Change: You know that we are committed to remain listed on the Brussels Stock Exchange and in New York. We recently changed our ticker symbol to CMBT. The name change of the company will take place on the 1st of October . So Euronav will become CMBTech and then the Euronav name will be our division.
Alexander Saverys: The portfolio, we discussed it at length. One thing I should highlight is, apart from everything you see on the water, delivering the good cash flows, we also have a very strong decarbonisation optionality value built in to our fleet as and when the new legislation will start to accelerate as from next year, the fuel EU maritime directive, etc. So we do see a lot of upside in our future-proof fleet, and then the outlook for all our markets is probably exceptional.
Speaker Change: The portfolio, we discussed it at length, one thing I should highlight is apart from everything you see on the water delivering the good cash flows, we also have a very strong decarbonisation optionality value built in in our fleet.
Speaker Change: As and when the new legislation will start to accelerate as from next year, few EU maritime directives, etc. So we do see a lot of upsides on our future-proof fleet.
Alexander Saverys: We should cherish it. It's been a long time since all shipping markets were actually in a positive supply-demand balance, and so we are definitely enjoying the rise. With that being said, I would like to conclude. Thank you for listening to us, and I'm opening the floor to questions. Yes, everyone who would like to.
Speaker Change: And then the outlook for all our markets, it's probably exceptional, we should cherish it, it's been a long time since all shipping markets were actually in a positive supply-demand balance, and so we are definitely enjoying the ride.
Speaker Change: With this being said, I would like to conclude. Thank you for listening to us and I'm opening the floor for questions.
Operator: Yes, everyone who would like to ask a question can raise their hands now. Please make sure that if I call out your name or phone number, you first introduce yourself prior to asking a question. So, the first one is Kristof Samoy. You can now unmute, and please ask your question.
Speaker Change: Yes, everyone who would like to ask a question can raise their hands now. Please make sure if I call out your name or phone number to first introduce yourself prior to asking your question.
Speaker Change: so the first one is he stock somewhat you can now onutes and please ask your question strp
Kristof Samoy: Hello, good afternoon, and congratulations on the good results. A few questions, if I may. You mentioned the Namibian bunker facility, which is well located in Namibia. So how far along are you with the timeline? I recall that the FID would be taken in the fourth quarter. Maybe you can elaborate a little bit more on the timing there. And then, secondly, the new castle moxes that are on the water now. Are they also part of the Fortescue consecutive forest charter pool? Thank you.
Speaker Change: Hello, good afternoon and congratulations with the good results.
Speaker Change: A few questions, if I may.
Speaker Change: You mentioned the Namibian bunker facility, which is well located in Namibia. So how far along are you with the timeline? I recall that the FID would be taken in the fourth quarter. Maybe you can elaborate a little bit more on timing there.
Speaker Change: And then secondly, the Newcastle Muxes that are on the water now, are they also part of the Fortescue consecutive voice charter pool? Thank you.
Alexander Saverys: Thank you, Kristof. Let me answer first on Namibia. In Namibia, we have three projects we are working on. One is the hydrogen refueling and production station, which we hope will be operational by the end of this year. That's a relatively small-scale project for local demand, so hydrogen for local applications. The second, which you are alluding to, is the tank terminal for ammonia.
Speaker Change: Thank you, Kristof. Let me answer first on Namibia. In Namibia, there's three projects we are working on. One is the hydrogen refueling and production station, which we hope will be operational by the end of this year. That's a relatively small scale project for local demand, so hydrogen for local applications.
Alexander Saverys: Indeed, I am expecting FID in the fourth quarter, maybe first quarter next year. And the timing, if we take FID at that time, will probably somewhere delivery in 2028. So that is kind of the time horizon we are looking for on that tank terminal, which we can use indeed as a bunkering point. And then the third project, which we are still working on the feasibility and pre-feed, is the ammonia factory locally in Namibia, based on solar power, water, and an electrolyser park. That is something for next year.
Speaker Change: The second, what you are alluding to, is the tank terminal for ammonia.
Speaker Change: Indeed, expecting FID fourth quarter, maybe first quarter next year, and the timing, if we take FID on that time, we'll probably somewhere delivery in 2028, so that is kind of the time horizon we are looking for on that tank terminal, which we can use indeed as a bunkering point.
Speaker Change: And then the third project, where we are still working on the feasibility and pre-feed, is the ammonia factory locally in Namibia, based on solar power, water and electrolyzer park, is something for next year. So no FID in the very short term on that project.
Alexander Saverys: So no FID in the very short term on that project. Then going on the FMG CVC pool that you mentioned, our relationship with FMG is a good relationship like with a lot of other iron ore mining companies, we do quite a few spot business with them and indeed we have some vessels on short term CVCs, but these are short term, we are talking maximum one year, these are not long term and it's not the full six vessels that we have today, it's a couple of these ships.
Speaker Change: Then going on the FMG CVC pool that you mentioned, our relationship with FMG is a good relationship like with a lot of other iron ore mining companies, we do quite a few spot business with them and indeed we have some vessels on short term CVCs.
Speaker Change: But these are short term, we are talking maximum one year, these are not long term, and it's not the full six vessels that we have today, it's a couple of these ships.
Alexander Saverys: Okay, thank you. And then, maybe as a follow-up to this question, we have seen the announcement of FortisQ teaming up with Costco on the construction and deployment of green ammonia-propulsed vessels. FortisQ is a long-term, long-term customer journey partner of yours. How should we read into this? Does this mean CMB Tech is out of the picture there for FortisQ? Or can you elaborate a little bit on how you see this or interpret this?
Unknown Executive: Okay, thank you. And then, maybe as a follow-up to this question, we have seen the announcement of FortisQ teaming up with Costco on the construction and deployment of green ammonia vessels. FortisQ is a long-term, long-term customer journey partner of yours. How should we read into this? Does this mean CMB Tech is out of the picture there for FortisQ? Or can you elaborate a little bit on how you see this or interpret this?
Speaker Change: Okay.
Speaker Change: Thank you. And then maybe as a follow-up to this question, we have seen the announcement of FortisQ teaming up with Costco on the construction and deployment of green ammonia-proposed vessels.
Speaker Change: Pertis Q is a long-term, long-time customer journey partner of Huw.
Speaker Change: How should we read into this?
Speaker Change: Does this mean CMB Tech is out of the picture there for FortisQ? Or can you elaborate a little bit on how you see this or interpret this?
Alexander Saverys: Okay, so first and foremost, you should ask Fortescue and Costco what the deal entails. I'm reading the same papers as you.
Speaker Change: ay so first and foremost you should ask fort is q and cosco what the deal and tails i' reading the same papers as you obviously we are talking both to cosco to fort s q what we understand it's a collaboration agreement about the topic which is very close to our heart
Alexander Saverys: Obviously, we are talking both to Costco and to Fortescue. What we understand is it's a collaboration agreement about a topic which is very close to our heart, and we see this development as a very good development that other people are following suit and are also committing time, effort, and, I hope, money to deploy more ammonia-powered vessels but also the whole ammonia supply chain to green our industry. I think this market is huge.
Unknown Executive: and we see this development as a very good development that other people are following suit and are also committing time, effort, and, I hope, money to deploy more ammonia-powered vessels but also the whole ammonia supply chain to green our industry. I think this market is huge. If Fortescue does a deal with Costco, I don't think that means they will not do deals with us. If Costco does a deal with Fortescue, that doesn't mean that they will not deal with us.
Speaker Change: And we see this development as a very good development, that other people are following suit and are also committing now time, efforts and I hope money to deploy more ammonia-powered vessels, but also the whole ammonia supply chain to green our industry. I think this market is huge. If Fortescue does a deal with Costco, I don't think that means they would not do deals with us.
Alexander Saverys: If Fortescue does a deal with Costco, I don't think that means they will not do deals with us. If Costco does a deal with Fortescue, that doesn't mean that they will not deal with us. So I think we're all dealing together. The most important element from that announcement for us is that the more people start investing real money in the ammonia supply chain and in decarbonizing shipping, the better it will be, and, eventually, also for CNB tech. We need this pie to become bigger.
Unknown Executive: So I think we're all dealing together. The most important element from that announcement for us is that the more people start investing real money in the ammonia supply chain and in decarbonizing shipping, the better it will be, and, eventually, for CMB Tech, we need this pie to become bigger.
Speaker Change: If Costco doesn't deal with Fortescue, that doesn't mean that Costco would not deal with us. So I think we're all dealing together. The most important element from that announcement for us is that the more people start investing real money...
Speaker Change: In the ammonia supply chain and in decarbonizing shipping, the better it will be, and eventually also for CMB Tech, we need this pie to become bigger.
Unknown Executive: No further questions from me.
Speaker Change: Okay, thank you.
Kristof Samoy: Okay, thank you. No further questions from me. Okay, the next one is Clément Mollet. You can now unmute and ask your question, please.
Speaker Change: no further questions for mea
Speaker Change: Okay, the next one is Clément Mollet. You can now unmute and ask your question, please.
Clément Mollet: i didnthink you s anything
Operator: More? I think you're slightly off.
Speaker Change: You'll have to unmute.
Operator: You'll have to unmute. Okay, then we will move on for now to Guy Brits. You may please unmute and ask your question. Then we will move on to Alexandre Rios. You can...
Speaker Change: Okay, then we will move on for now to Guy Brits. You may please unmute and ask your question.
Unknown Executive: Then we will move to Alexander Rios. You can...
Speaker Change: then you will move to alexanda os you can please a youth and after a question p
Speaker Change: Alex, can you hear us?
Guy Brits: Ah, there you are. Can you hear me? I can't hear. Yeah, go ahead. Okay, if you can hear me, I was just wondering... In Tradewinds recently, we could read that you were linked to a 20 ship chemical tanker deal. I was wondering if you had any comments on that.
Speaker Change: Hello?
Alexander Rios: I can't hear you. Yeah.
Alexander Saverys: I can confirm that there are discussions ongoing with Exxon, but it's not about 20 ships; it's about 7 ships, but nothing has been signed firmly yet. So the information in tradewinds is not really correct. But I can confirm that there have been discussions with Exxon about the chemical tanker project. But it's about seven ships, not 20.
Alex: Okay, if you can hear me, I was just wondering...
Alexander Saverys: Exciting stuff. Can you say anything about the size of those vessels?
Speaker Change: In Tradewinds recently we could read that you were linked to a 20 ship chemical tanker deal. I was wondering if you have any comments on that.
Unknown Executive: I was wondering if you have any comments on that.
Alexander Rios: I suppose, the transaction.
Alexander Rios: Yeah. So...
Speaker Change: i can confirm that there are discussions ongoing with exon but it's not about twenty shops it's about seven ships but nothing has been signed firmly yet
Speaker Change: So, the information in tradewinds is not really correct, but I can confirm that there's been discussions with Exxon about a chemical tanker project, but it's about 7 ships, not 20.
Alexander Rios: Exciting stuff. Can you say anything about the size of those vessels?
Alexander Saverys: No, not yet, but as soon as we get news on that and that contracts will be signed, and I stress that contracts have not been signed yet, we will definitely give you more information. Okay, thank you. That was all my questions.
Speaker Change: No, not yet, but as soon as we have news on that and that contracts would be signed, and I stress contracts have not been signed yet, we will definitely give you more information.
Guy Brits: Okay, thank you. That was all my questions. Thanks. Kimo S.U.
Alexander Rios: Okay, thank you. That was all my questions.
Unknown Executive: Thanks.
Operator: Kimo, I see you raised your hand again. Can you please unmute and ask your question, please? We're moving on. The number ending in 8703. You may please unmute and ask your question, please.
Speaker Change: Ms. Clément, I see you raised your hand again. Can you please unmute and ask your question, please?
Speaker Change: We're moving on. The number ending in 8703. You may please unmute and ask your question, please.
Operator: Maybe for the ones who are trying to get a voice over, if you want to post a message just in the meeting, then we'll try to respond now. If that still doesn't work, obviously, we'd be happy to answer your email and all your questions.
Speaker Change: Maybe for the ones who are trying to get a voiceover, if you want to post a message just on the meeting, and then we'll try to respond now. If that still doesn't work, obviously, we'd be happy to answer your email and all your questions.
Alexander Saverys: Okay, very good. Thank you very much for joining this call. Thank you for your questions. As Ludovic said, if you have any other questions, Joris from investor relations, Ludovic and myself are there to assist you and answer any questions you might have. Hope to speak to you soon. Enjoy the sunny weather if you're in a sunny place. Thank you. Bye bye.
Alexander Saverys: A lot of green lights when we look at the demand indicators, but some red lights as well. It will come as no surprise to you that the oil supply from OPEC is not positive, definitely not for the VLCCs. We see that China's oil imports year on year are a little bit down, but all in all, if we combine some of the positive demand signals with the very low order book coming on stream, we are still in a very healthy supply and demand environment.
Alexander Saverys: That means that we will need more tankers in the tanker industry for the next 5 years. And when we look at the order book, the order book is still relatively low; we have seen some new orders, but again, according to this model, we would see that we are in a structural shortage of ships, which should bode well for our markets going forward in the next year. Next slide.