Q3 2025 Himalaya Shipping Ltd Earnings Call

For Himalaya shipping.

For the first part of this call, all participants will be in a listen-only mode.

Afterwards. Start your question and answer session.

If you wish to ask a question, please press 5 star on your telephone keypad.

This call is being recorded allowed to call or to speakers you may now begin.

Thank you, operator. Welcome to the Q3 2025 conference call for Himalaya shipping, my name is Lois Johnson and I will be joined here today by our CFO VA hosen

Before we start the presentation, I would like to remind you that we will be discussing matters for a forward-looking these assumptions. Reflect the company's current views regarding future events and our subject to risks and uncertainties.

Actual results May differ materially from those anticipated.

I will now continue with the highlights of the quarter.

We reported a net profit of 9.5 million and an ebita out. 29.3 million the gross time chart for equivalent earnings for the quarter was approximately 35,600 per day.

We converted, the index link time charters for 4 vessels to fixed rate. Time Charters at an average rate of 35,300 per day from August, the 1st to September the 30th.

Further conversions were made for 4 vessels from index linked to fixed time charges at an average rate of 38 and a half thousand dollars from October 1st until December 31st.

Total cash distributions for the quarter total 24 cents per share for the month of July, August and September.

In subsequent events, we achieved a time chart for equivalent earnings for October of about 36,800 per day and we declared a dividend of 7 cents for the month.

And with that, I will now pass the word to V.

Thank you reports on net profit of 9.5 million and earnings per share of 21 cents for Q3 2025 compared to a net income of 10.6 million and earnings per share of 24 cents for Q3 2024.

Operating profit was 22 million and Abita was 29.3 Million for the quarter compared to operating profit of 23.6 million, and Abit of 30.9 million for the same period last year.

Operating revenues worth 37.9 million for Q3 2025 compared to 39.24% in 2024.

The reduction in revenues is due to lower time Charter equivalent earnings achieved, which is down from 36,800 in Q3 2024 to 35,600 in Q3 2025.

West low operating expenses were 7 million in Q3 2025 compared to 6.5 million in Q3 2024.

The increase is primarily due to higher cost for spares and repairs and maintenance.

The average Opex per day was 6,400 per day compared to 6,000 per day during Q3 2024.

GNA for the third quarter was 1.1 million compared to 1.4 million in Q3 2024.

The decrease is primarily due to reduced cost for dno insurance.

interest expense with 12.8 million, in Q3 2025, which is 0.4 million, decrease compared to the same period in 2024, due to a lower average loan principal outstanding in Q3 2025, as a result of loan repayments

Cash and cash equivalents for 26.4 million at the end of the quarter.

The minimum cash requirement on the Rosales back. Financing is 12.3 million.

Outstanding balance on the sale East Bank financing was approximately 77 million at the end of the third quarter.

It's down from 714 million, at the end of the second quarter reflecting scheduled repayments.

Cash flow from operations was 18.3 million for the third quarter.

Himalaya shipping have declared total cash distribution to shareholders of 24 cents for the month of July, August, and September 2025.

That completes the financial section and now back to you Lo Christian.

Thank you, V. Before, I will guide you through our market section. Here are some company updates.

NBC value on the FFA curve as mentioned earlier in the presentation.

Currently 6 of our 12 ships will be on fixed rates until 31st December 2025 at an average rate of 36,300 per day.

The 100% exposed to the spot Market from 2026 to capture, what we believe will be a strong year ahead.

To illustrate our Fleet and Commercial performance. You can see on this slide that since Inception, the Himalaya vessels have traded to an average 50% premium to the Baltic capes as index and at 23%, premium to pairs.

This is a G by the extra cargo intake on our vessel and top tier of speed and consumption design on athletes.

We also have timed our conversions. Well as proved by our Q4, conversions to fixed rates.

Here you can see our unique dividend capacity based on various rates scenarios for a standard Cape size vessel.

when the Baltic Cape size index moved to $30,000 per day, the company will yield about 22%

When we see moves to around 40,000 per day, this will produce a yield of around 40%.

and when we see 55,000 a day on the Baltic Cape size, index Himalaya will yield, well, above 60%,

Our Fleet to 12 modern Newcastle, access with dual fuel LNG is in the top 1% emission, ratings for large bulk carriers.

The attractive financing combined with a very clear, Capital, allocation structure has led to 22 monthly consecutive dividends.

All the vessels are fixed out on long-term index, linked contracts with conversion options.

The all-in cash break-even equivalent to the Baltic Cape Size Index is $17,000 per day. I.e., every time you see the Baltic Cape Size Index above that number, Himalaya Shipping will make money.

Now, let's have a look at the market.

The Tom Mi story continues to move in the right direction. After a large drop in Q4 2024, due to the cold cannibalization from the Panama access.

To Tom Mile in Q3 for Cape size increased 2% year-over-year, thanks to a 15% increase in bulks up from Guinea and a 3%. Increase from Iron Ore

year-over-year. Iron ore exports from Brazil and Australia is up 4 and 2%, respectively, and bulk site exports from Guinea has again surpassed expectation with an 18% year-over-year increase.

You have discussed the bulk side trade extensively in several quarterly presentations and it's a keen interest. We observe volume growth in 1 commodity to this extent.

Most of the guinean export volumes are destined for China. And as you can see, from the top left graph, inputs are continuing at the solid pace.

As a central component. In the aluminum industry China, use a vast share of imported bulk site volumes for the electric vehicle production inputs are increasing and so is the aluminum production which indicates room for further growth as Illustrated in the bottom left graph.

To the right, you can see the increase in the impact of the bulk side, trading ten miles.

Boyt has this? Yes. It passed called by a good margin for the first time in history.

The global ion or exports have been strong since q1 this year. So far surpassing the 4 previous years

More importantly, for the cape stars in Newcastle Market segment, is that the seaborne iron ore Imports. So far this year, also, outperformed the previous years and compared to 2024 modern 7%.

If I can draw your attention to the bottom right graph, the observed that excitement that the Chinese iron ore inventories are down, almost 10% comparing to the same period last year, which again indicates the continued need for iron ore in China.

As for the long-term, I know demand, the left grass shows, the Eno production cost distribution, we have frequently been asked what would happen if the Eno price to come down from above hundred dollars per ton based on the cost curve. If it implied that the Chinese domestic production will continue to decline

If you look at the 2, you can see that the Chinese domestic production adjusted for iron ore content. Has declined the last 15 years that the iron or inputs have increased accordingly in conclusion. All positive for Freight in the Newcastle Maxx, in Cape size space,

Continuing on the Eno track. The first volumes of iron ore from the simu. Mining Guinea are expected to be exported this month according to the latest updates.

Between 2 million. Tons are apparently Dockside and ready to be shipped.

Over a 24-month ramp up phase. The minus targeting, 120 million, tons of high-grade iron, ore panum to the market.

As you can see from the right graph, comparing these volumes to the record low order book, the supply store strengthens further.

In addition to the low order book, the current Cape size in Newcastle, Max Fleet is aging fast around. 50% of the total fleet was built between 2009 and 2015.

That means that 60% of the fleet will be over 20 years of age in 2034.

Ship owners historically have been good at ruining, their own markets by placing new building orders. But as it looks now we have clear visibility of supply for the next 3, 4 years making it difficult to add any meaningful, large bulk dry, bulk capacity to the market.

As we are moving, towards the end of this presentation, we continue to highlight the historical low order book.

if you're at the 25-year record low standing at 9.3% of the total existing Cape size, Fleet,

Active shipyards are down 60% for the peak of 2008, making it challenging to build any Fleet capacity that could distort the favorable Supply Dynamics over the next few years.

As a comparison to the other shipping segments, you can see from the right graph. That the cape size order book to Fleet ratio is by far most favorable.

Thank you your number line, pasta word. Back to the operator, and welcome, any questions. You might have.

Thank you. If you do wish to ask a question, please press 5 star and telephone keypad.

So we draw a question, you may do so by pressing 5 Star again, that will be a brief. Pause while Christians are being registered.

Our first question comes from the line of Evangelical from Clarkson Security's. Please go ahead, your line will be on muted.

Thank you.

So, if you look at the market in 26,

you are most other people including us are quite positive, 2 decades markets, due to the factors, you talked about. But I think the main push back is that the cape Market does not that good, um,

Have you seen 2 or 25? There's been a lot of call splitting from Australia. So, 426, how good? Or how much?

Of an outperformance switching, The Capes size markets. Can I have compared to the sub Cape Market?

Yeah, hi. Thanks for the question. Yeah, we see quite a bit of cold splits, uh, and the last year and this year, that's true. Uh, but I think the potential for the cape sizes to continue to rally is higher based on the big frontal routes that we talked about in this presentation. And the downside to this Market, I would say is a lot less.

We saw last year simply because we lost so much coal on the total Fleet.

Um but the bulk side volumes are strong, the Sim undo volumes are destined to be big and strong as well. So and

With the panamax is moving quite uh, quite a bit higher now as well. We think that the cape sizes can rally like they normally do at least 2 and a half times the panamax segments and it's good to see that the panamax is are doing well on the colon range as well.

Yeah, thanks. I'm just um, moving to the for your feed which is currently fully open for 26.

And I guess it's about the first quarter of next year. We're currently using the FFA that

6770000500 a day.

so,

As your tool is spot at the moment. Thank you. You think the first quarter could go higher or are you looking to get some average for the first quarter?

Um deeper is obvious. We all always are moving Target. We have expectations that are solid going forward and yes, you, absolutely, right. We have not locked in at these levels right now because we think we might see another push. Um but as normal when we do conversions, if we see value on the forward curve, we will lock it in and uh, move on. We can always unwind it if we, if there's uh, if our view has been wrong. But for now we still have faith in in 26 and also 27.

Yeah, thank you. That's all for me.

and as a reminder,

Press 5 Star to ask a question that would be brief pause while new questions are being registered.

As No 1 else has signed up for questions. I'll now hand it back to the speakers for any closing remarks.

Thank you very much for listening. We look forward to having further updates for you in the next quarter. Thank you very much. Bye.