Belships ASA - Report 2nd quarter 2020

A CHALLENGING QUARTER – IMPROVING OUTLOOK AHEAD

HIGHLIGHTS

• Operating income of USD 28.6 million (Q2 2019: USD 29.6m)
• EBITDA of USD 1.9m (USD 8.0m)
• Net result of USD -14.6m (USD 0.1m). Net result includes non-cash impairment of USD 4.9m total for the four oldest vessels in the fleet
• Net TCE earnings per ship of USD 6 927 per day versus BSI index of USD 5 210 net per day
• Realised FFA gains equivalent to USD 1 117 net per vessel day resulting in total outperformance of the Baltic Supramax market index of 54 per cent
• 60 per cent of remaining ship days in 2020 are booked at USD 9 600 net per day
• Taken delivery of BELHAVEN and issued shares
• Modern fleet of 23 vessels with an average age of 5 years including newbuildings

Fleet status
Time charter earnings per ship in the quarter were recorded at USD 6 927 net per day versus BSI index of USD 5 210 net per day for the same period. In addition, FFA gains equivalent to USD 1 117 net per vessel day (USD 2.0m) were realised resulting in a total outperformance of the Baltic Supramax market index of 54 per cent. Outperformance of the BSI index is due to the portfolio of period charter coverage and outsized spot earnings achieved by our subsidiary Lighthouse Navigation.

About 60 per cent of remaining ship days in 2020 are booked at USD 9 600 net per day. About 90 per cent of available days in Q3 have been booked at about USD 9 000 net per day and about 40 per cent in Q4 are booked at about USD 11 000 net per day.

BELSOUTH and BELNOR were drydocked in the quarter. BELFORT underwent repairs in mid-April and resumed full operating at the end of the month.

The remaining fleet sailed without significant off-hire in the quarter.

Vessel transactions
In May, Belships took delivery of BELHAVEN, a 63 000 dwt Ultramax from Japanese Owners. The vessel was built in 2017 by Imabari shipyard and delivered after having passed its dry-docking survey. The purchase price of USD 24.5m was settled by issuing new shares equivalent to 50 per cent at a subscription price of NOK 7.15 per share (USD/NOK 9.31), and the remaining in cash. Belships utilised 60 per cent financing of the purchase price, resulting in a positive cash effect of about USD 2.45 million. BELHAVEN is currently fixed for about 11-13 months time charter at about USD 12 200 per day net.