Exhibit 99.2
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
![]() | I am delighted to announce that Hafnia in Q2 has once again delivered strong results, achieving a net profit of USD 259.2 million, bringing our total net profit in the first half of 2024 to USD 478.8 million. This quarter marks our best performance since the beginning of 2023 and represents the strongest first-half results in our company’s history. Our adjacent fee-generating business segments have continued to thrive in this earnings environment, contributing USD 10.7 million to our overall results in Q2. At the end of the second quarter, our net asset value (NAV)1 stands at around USD 4.5 billion. This increase is primarily driven by the rising value of our vessels, resulting in a NAV per share of approximately ~USD 8.77 (NOK 93.31). With these strong results and in line with our recent increase in the dividend payout ratio, I am pleased to announce a dividend payout ratio of 80% based on a net LTV of 21.3% attained in Q2. With this, we will distribute a total of USD 207.4 million or USD 0.4049 per share in dividends. This marks the highest dividend payout in our company’s history for the second consecutive quarter, reinforcing our dedication to providing strong shareholder returns. |
The product tanker market remained strong in the second quarter, despite ongoing volatility. Geopolitical tensions and disruptions in the Red Sea, along with continued refinery ramp-ups and dislocations, have contributed significantly to the increase in product tonne-mile demand.
The market outlook remains optimistic with elevated product tanker rates expected to continue for an extended period. This is primarily due to low global stockpiles, which have led to a substantial increase in refinery throughput and cargo flow. Additionally, the start of production at Nigeria’s Dangote refinery and the anticipated ramp-up in Chinese refineries by late 2024 are anticipated to further boost global refinery operations.
As of August 9, 2024, 72% of the Q3 earning days are covered at an average of USD 34,934 per day, and 45% covered at USD 33,534 per day for the remainder of 2024. This positions us for a strong quarter ahead, especially compared to Q3 of last year, which averaged USD 28,954 per day.
In July, one of our vessels, the Hafnia Nile, was unfortunately involved in a collision with a VLCC in the South China Sea. All 22 crew members of Hafnia Nile were safely rescued. Hafnia is currently collaborating with the Malaysian Marine Department (MMD) and the Maritime and Port Authority (MPA) of Singapore in their ongoing investigations concerning the nature of the collision.
As we conclude another quarter, I sincerely thank our partners and the exceptional team at Hafnia for their invaluable support in helping us achieve our goals. Looking ahead, we remain committed to navigating challenges with agility and seizing further opportunities to strengthen our market position.
Mikael Skov
CEO Hafnia
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Safe Harbour Statement | 4 |
Highlights – Q2 and H1 2024 | 5 |
Key figures | 8 |
Condensed consolidated interim statement of comprehensive income | 9 |
Condensed consolidated balance sheet | 10 |
Condensed consolidated interim statement of changes in equity | 11 |
Condensed consolidated statement of cash flows | 12 |
Cash and cash flows | 13 |
Dividend policy | 13 |
Coverage of earning days | 14 |
Tanker segment results | 15 |
Risk factors | 16 |
Responsibility statements | 16 |
Notes
Notes to the Condensed Consolidated Interim Financial Information | 17 |
Note 1: General information | 17 |
Note 2: Basis of preparation | 17 |
Note 3: Changes in accounting policies | 17 |
Note 4: Material accounting policies | 18 |
Note 5: Revenue | 22 |
Note 6: Property, plant and equipment | 22 |
Note 7: Shareholders’ equity | 24 |
Note 8: Borrowings | 26 |
Note 9: Commitments | 28 |
Note 10: Share-based payment arrangements | 29 |
Note 11: Financial information | 30 |
Note 12: Significant related party transactions | 32 |
Note 13: Joint ventures | 32 |
Note 14: Segment information | 35 |
Note 15: Subsequent events | 37 |
Note 16: Fleet list | 37 |
Note 17: Non-IFRS measures | 39 |
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Disclaimer regarding forward-looking statements in the interim report
Matters discussed in this unaudited interim report (this “Report”) may constitute “forward-looking statements”. The Private Securities Litigation Reform Act of 1995 provides safe harbour protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts or present facts and circumstances.
We desire to take advantage of the safe harbour provisions of the Private Securities Litigation Reform Act of 1995 and are including this cautionary statement in connection with this safe harbour legislation. This Report and any other written or oral statements made by us or on our behalf may include forward-looking statements, which reflect our current views with respect to future events and financial and operational performance.
These forward-looking statements may be identified by the use of forward-looking terminology, such as the terms “anticipates”, “assumes”, “believes”, “can”, “continue”, “could”, “estimates”, “expects”, “forecasts”, “intends”, “likely”, “may”, “might”, “plans”, “should”, “potential”, “projects”, “seek”, “will”, “would” or, in each case, their negative, or other variations or comparable terminology. They include statements regarding Hafnia’s intentions, beliefs or current expectations concerning, among other things, the financial strength and position of the Group, operating results, liquidity, prospects, growth, the implementation of strategic initiatives, as well as other statements relating to the Group’s future business development, financial performance and the industry in which the Group operates.
Prospective investors in Hafnia are cautioned that forward-looking statements are not guarantees of future performance and that the Group’s actual financial position, operating results and liquidity, and the development of the industry and potential market in which the Group may operate in the future, may differ materially from those made in, or suggested by, the forward-looking statements contained in this Report. Hafnia cannot guarantee that the intentions, beliefs or current expectations upon which its forward-looking statements are based, will occur.
By their nature, forward-looking statements involve, and are subject to, known and unknown risks, uncertainties and assumptions as they relate to events and depend on circumstances that may or may not occur in the future. Actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors including, but not limited to:
• | general economic, political, security, and business conditions, including the development of the ongoing war between Russia and Ukraine and the conflict between Israel and Hamas; |
• | general chemical and product tanker market conditions, including fluctuations in charter rates, vessel values and factors affecting supply and demand of crude oil and petroleum products or chemicals, including the impact of the COVID-19 pandemic and the ongoing efforts throughout the world to contain it; |
• | changes in expected trends in scrapping of vessels; |
• | changes in demand in the chemical and product tanker industry, including the market for LR2, LR1, MR and Handy chemical and product tankers; |
• | competition within our industry, including changes in the supply of chemical and product tankers; |
• | our ability to successfully employ the vessels in our Hafnia Fleet and the vessels under our commercial management; |
• | changes in our operating expenses, including fuel or cooling down prices and lay-up costs when vessels are not on charter, drydocking and insurance costs; |
• | our ability to comply with, and our liabilities under, governmental, tax, environmental and safety laws and regulations; |
• | changes in governmental regulations, tax and trade matters and actions taken by regulatory authorities; |
• | potential disruption of shipping routes and demand due to accidents, piracy or political events; |
• | vessel breakdowns and instances of loss of hire; |
• | vessel underperformance and related warranty claims; |
• | our expectations regarding the availability of vessel acquisitions and our ability to complete the acquisition of newbuild vessels; |
• | our ability to procure or have access to financing and refinancing; |
• | our continued borrowing availability under our credit facilities and compliance with the financial covenants therein; |
• | fluctuations in commodity prices, foreign currency exchange and interest rates; |
• | potential conflicts of interest involving our significant shareholders; |
• | our ability to pay dividends; |
• | technological developments; and |
• | the impact of increasing scrutiny and changing expectations from investors, lenders and other market participants with respect to environmental, social and governance initiatives, objectives and compliance. |
Additional information about material risk factors that could cause actual results to differ materially from expectations and about material factors or assumptions applied in making forward-looking statements may be found under “Item 3. – Key Information – D. Risk Factors” of Hafnia’s Registration Statement on Form 20-F, filed with the U.S. Securities and Exchange Commission on 1 April 2024. Because of these known and unknown risks, uncertainties and assumptions, the outcome may differ materially from those set out in the forward-looking statements. These forward-looking statements speak only as at the date on which they are made. Hafnia undertakes no obligation to publicly update or publicly revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to Hafnia or to persons acting on Hafnia’s behalf are expressly qualified in their entirety by the cautionary statements referred to above and contained elsewhere in this Report.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Financial – Q2
The commercially managed pool and bunker procurement business generated an income of USD 10.7 million (Q2 2023: USD 10.1 million). |
Adjusted EBITDA2 was USD 317.1 million in Q2 2024 (Q2 2023: USD 261.6 million). |
As of 9 August 2024, 72% of total earning days of the fleet were covered for Q3 2024 at USD 34,934 per day. |
In April 2024, Hafnia Board of Directors approved an increase in the dividend payout ratio. Under the revised dividend policy, Hafnia will increase its payout ratio from the previous 70%, to 80%, when the net loan-to-value is above 20% but equal to or below 30%. Furthermore, if the net loan-to-value is equal to or below 20%, the payout ratio will be further elevated to 90%. |
In line with this increase in payout ratio, Hafnia will distribute a total of USD 207.4 million or USD 0.4049 per share in dividends, corresponding to a payout ratio of 80%. |
Financial – H1
In H1 2024, Hafnia recorded a net profit of USD 478.8 million equivalent to a profit per share of USD 0.94 per share1 (H1 2023: USD 469.9 million equivalent to a profit per share of USD 0.93 per share). |
The commercially managed pool and bunker procurement business generated an income of USD 20.5 million (H1 2023: USD 21.2 million). |
Time Charter Equivalent (TCE)2 earnings for Hafnia Limited (the "Company" or "Hafnia", together with its subsidiaries, the "Group") were USD 796.2 million in H1 2024 (H1 2023: USD 726.5 million) resulting in an average TCE2 of USD 37,750 per day. |
Adjusted EBITDA2 was USD 604.1 million in H1 2024 (H1 2023: USD 557.6 million). |
1 Based on weighted average number of shares as at 30 June 2024
2 See Non-IFRS Measures in Note 17.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Market
In the second quarter of 2024, the product tanker market continued to demonstrate strong earnings, primarily due to longer average sailing distances as vessels rerouted away from the Suez Canal to the Cape of Good Hope. Additionally, droughts in the Panama Canal and low diesel inventories in Europe contributed to a robust second quarter.
Consequently, Clean Petroleum Products (CPP) on water and tonne-miles reached new highs. This increase is driven by longer voyages, not only from the Middle East to the West but also across the Pacific. The disproportionate rise in tonne-miles compared to loaded volumes is largely due to the dislocation of refineries, with Eastern refineries increasingly supplying Atlantic consumers via Cape of Good Hope routing.
According to the International Energy Agency (IEA), global oil demand growth slowed in the second quarter of 2024, with an increase of only 0.9 million barrels per day year-on-year. This deceleration was driven by a contraction in Chinese consumption, as the country’s post-pandemic economic recovery plateaued. However, global oil demand in the second quarter increased by 1.8 million barrels per day to 103.1 million per day, compared to the previous quarter.
The start of production at Nigeria’s Dangote refinery and the expected ramp-up in Chinese refineries by late 2024 is anticipated to further boost global refinery operations. The IEA forecasts that global refinery throughputs will increase by 0.8 million barrels per day to 83.3 million barrels per day in 2024.
Product tanker contracting activity continues to rise, with the orderbook-to-fleet ratio reaching approximately 20% for deliveries until 2028, as of August 2024. However, the average age of the global product tanker fleet is increasing, and we are observing a substantial reduction in utilization of about 30% for vessels over 20 years of age. LR2s account for over 50% of the tonnage to be delivered in the next few years, but historically 70% of the LR2 capacity delivered has been absorbed into dirty petroleum products trade. Additionally, there has been an increase in cannibalization from the crude sector due to the earnings differential between the sectors. However, with the crude tanker orderbook standing lower at approximately 9% and higher OPEC exports anticipated, crude rates are expected to rise, reducing the cannibalization effect from Q4 2024.
Looking ahead, the outlook for the product tanker market remains positive. Demand is expected to stay strong due to longer transport distances and the dislocation of refineries. Even if transits across the Red Sea resume, we believe any immediate negative impact is likely to be short-lived, as market fundamentals remain strong, and consistent with 2023 levels.
Fleet
At the end of the quarter, Hafnia’s fleet consisted of 117 owned vessels1 and 16 chartered-in vessels. The Group’s total fleet includes 10 LR2s, 35 LR1s (including three bareboat-chartered in and four time-chartered in), 64 MRs of which nine are IMO II (including three bareboat chartered in and 12 time-chartered in), and 24 Handy vessels of which 18 are IMO II (including seven bareboat-chartered in).
The average estimated broker value of the owned fleet was USD 4,811 million, of which the LR2 vessels had a broker value of USD 647 million2, the LR1 fleet had a broker value of USD 1,251 million2, the MR fleet had a broker value of USD 2,024 million3 and the Handy vessels had a broker value of USD 888 million4. The unencumbered vessels had a broker value of USD 389 million. The chartered-in fleet had a right-of-use asset book value of USD 24.1 million with a corresponding lease liability of USD 28.3 million.
2 Including USD 345 million relating to Hafnia’s 50% share of six LR1s and four LR2s owned through 50% ownership in the Vista Shipping Joint Venture
3 Including USD 52 million relating to Hafnia’s 50% share of two MRs owned through 50% ownership in the H&A Shipping Joint Venture; and IMO II MR vessels
4 Including IMO II Handy vessels
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Hafnia will pay a quarterly dividend of USD 0.4049 per share. The record date will be 3 September 2024.
For shares registered in the Euronext VPS Oslo Stock Exchange, dividends will be distributed in NOK with an ex-dividend date of September 2, 2024 and a payment date on, or about, September 13, 2024.
For shares registered in the Depository Trust Company, the ex-dividend date will be September 3, 2024 with a payment date on, or about, September 10, 2024.
Please see our separate announcement for additional details regarding the Company’s dividend.
The Interim Financial Information Q2 and H1 2024 has not been audited or reviewed by auditors.
Webcast and Conference call
Hafnia will host a conference call for investors and financial analysts at 8:30 pm SGT/2:30 pm CET/8:30 am EST on 23 August 2024.
The investor presentation will be available via live video webcast via the following link: Click here to join Hafnia's Investor Presentation on 23 August 2024
Meeting ID: 373 678 366 170
Passcode: 55R75k
Download Teams | Join on the web
Dial in by phone:+45 32 72 66 19,,232058645# Denmark, All locations
Find a local number
Phone conference ID: 232 058 645#
A recording of the presentation will be available after the live event on the Hafnia Investor Relations Page: https://investor.hafnia.com/financials/quarterly-results/default.aspx.
Hafnia
Mikael Skov, CEO Hafnia: +65 8533 8900
www.hafniabw.com
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
USD million | Q1 2024 | Q2 2024 | H1 2024 | ||
Income Statement | |||||
Operating revenue (Hafnia vessels and TC vessels) | 521.8 | 563.1 | 1,084.9 | ||
Profit before tax | 221.3 | 260.8 | 482.1 | ||
Profit for the period | 219.6 | 259.2 | 478.8 | ||
Financial items | (18.9) | (9.9) | (28.8) | ||
Share of profit from joint ventures | 7.3 | 8.5 | 15.8 | ||
378.8 | 417.4 | 796.2 | |||
Adjusted EBITDA1 | 287.1 | 317.1 | 604.1 | ||
Balance Sheet | |||||
Total assets | 3,897.0 | 3,922.7 | 3,922.7 | ||
Total liabilities | 1,541.8 | 1,486.2 | 1,486.2 | ||
Total equity | 2,355.2 | 2,436.5 | 2,436.5 | ||
Cash at bank and on hand2 | 128.9 | 166.7 | 166.7 | ||
Key financial figures | |||||
Return on Equity (RoE) (p.a.) 3 | 38.3% | 44.5% | 41.1% | ||
Return on Invested Capital (p.a.) 4 | 27.6% | 31.4% | 29.6% | ||
Equity ratio | 60.4% | 62.1% | 62.1% | ||
Net loan-to-value (LTV) ratio5 | 24.2% | 21.3% | 21.3% |
For the 3 months ended 30 June 2024 | LR2 | LR1 | Total | |||
Vessels on water at the end of the period8 | 6 | 29 | 62 | 24 | 121 | |
Total operating days9 | 544 | 2,514 | 5,394 | 2,183 | 10,635 | |
Total calendar days (excluding TC-in) | 546 | 2,275 | 4,550 | 2,184 | 9,555 | |
TCE (USD per operating day)1 | 60,116 | 46,986 | 35,913 | 33,358 | 39,244 | |
Spot TCE (USD per operating day)1 | 60,116 | 46,986 | 38,077 | 34,474 | 40,995 | |
TC-out TCE (USD per operating day)1 | – | – | 25,674 | 25,447 | 25,623 | |
OPEX (USD per calendar day)10 | 7,626 | 8,048 | 8,050 | 8,045 | 8,024 | |
G&A (USD per operating day)11 | 1,651 |
Vessels on balance sheet
As of 30 June 2024, total assets amounted to USD 3,922.7 million, of which USD 2,683.4 million represents the carrying value of the Group’s vessels including dry docking but excluding right-of-use assets, is as follows:
USD million | LR2 | LR1 | MR6 | Handy7 | Total |
Vessels (including dry-dock) | 248.9 | 645.8 | 1,242.0 | 546.7 | 2,683.4 |
2 Excluding cash retained in the commercial pools.
3 Annualised
4 ROIC is calculated using annualised EBIT less tax.
5 Net loan-to-value is calculated as vessel bank and finance lease debt (excluding debt for vessels sold but pending legal completion), debt from the pool borrowing base facilities less cash at bank and on hand, divided by broker vessel values (100% owned vessels).
6 Inclusive of nine IMO II MR vessels.
7Inclusive of 18 IMO II Handy vessels.
8 Excluding six LR1s and four LR2s owned through 50% ownership in the Vista Shipping Joint Venture and two MRs owned through 50% ownership in the H&A Shipping Joint Venture.
9Total operating days include operating days for vessels that are time chartered-in. Operating days are defined as the total number of days (including waiting time) in a period during which each vessel is owned, partly owned, operated under a bareboat arrangement (including sale and lease-back) or time chartered-in, net of technical off-hire days. Total operating days stated in the quarterly financial information include operating days for TC Vessels.
10 OPEX includes vessel running costs and technical management fees.
11 G&A includes all expenses and is adjusted for cost incurred in managing external vessels.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
For the 3 months ended 30 June 2024 USD’000 | For the 3 months ended 30 June 2023 USD’000 | For the 6 months ended 30 June 2024 USD’000 | For the 6 months ended 30 June 2023 USD’000 | ||
Revenue (Hafnia Vessels and TC Vessels) | 563,098 | 478,199 | 1,084,890 | 1,000,800 | |
268,064 | 222,743 | 531,165 | 316,700 | ||
Voyage expenses (Hafnia Vessels and TC Vessels) | (145,739) | (128,851) | (288,729) | (274,260) | |
Voyage expenses (External Vessels in Disponent-Owner Pools)1 | (84,270) | (77,010) | (168,483) | (119,761) | |
Pool distributions for External Vessels in Disponent-Owner Pools1 | (183,794) | (145,733) | (362,682) | (196,939) | |
417,359 | 349,348 | 796,161 | 726,540 | ||
Other operating income | 10,675 | 10,129 | 20,499 | 21,239 | |
Vessel operating expenses | (69,063) | (65,493) | (138,692) | (130,148) | |
Technical management expenses | (7,607) | (5,785) | (13,326) | (11,810) | |
Charter hire expenses | (11,663) | (8,123) | (21,193) | (15,010) | |
Other expenses | (22,618) | (18,518) | (39,314) | (33,240) | |
317,083 | 261,558 | 604,135 | 557,571 | ||
Depreciation charge of property, plant and equipment | (54,595) | (51,545) | (108,388) | (103,206) | |
Amortisation charge of intangible assets | (251) | (323) | (587) | (655) | |
(Loss)/gain on disposal of assets | (100) | 19,828 | (100) | 56,515 | |
Operating profit | 262,137 | 229,518 | 495,060 | 510,225 | |
Capitalised financing fees written off | – | – | (1,663) | – | |
Interest income | 4,479 | 5,515 | 7,284 | 10,424 | |
Interest expense | (13,215) | (21,509) | (29,042) | (50,709) | |
Other finance expense | (1,185) | (3,884) | (5,398) | (7,564) | |
Finance expense – net | (9,921) | (19,878) | (28,819) | (47,849) | |
Share of profit of equity-accounted investees, net of tax | 8,553 | 5,140 | 15,842 | 10,962 | |
Profit before income tax | 260,769 | 214,780 | 482,083 | 473,338 | |
Income tax expense | (1,572) | (1,513) | (3,315) | (3,436) | |
Profit for the financial period | 259,197 | 213,267 | 478,768 | 469,902 | |
Other comprehensive income: | |||||
Items that may be subsequently reclassified to profit or loss: | |||||
Foreign operations – foreign currency translation differences | – | – | 23 | (71) | |
Fair value gains on cash flow hedges | 4,623 | 18,032 | 18,747 | 16,143 | |
Reclassification to profit or loss | (8,032) | (8,283) | (16,424) | (16,692) | |
(3,409) | 9,749 | 2,346 | (620) | ||
Items that will not be subsequently reclassified to profit or loss: | |||||
Equity investments at FVOCI – net change in fair value | – | – | 1,260 | – | |
Total other comprehensive income | (3,409) | 9,749 | 3,606 | (620) | |
Total comprehensive income for the period | 255,788 | 223,016 | 482,374 | 469,282 | |
Earnings per share attributable to the equity holders of the Company | |||||
Basic no. of shares | 509,156,418 | 504,148,220 | 509,156,418 | 504,148,220 | |
Basic earnings in USD per share | 0.51 | 0.42 | 0.94 | 0.93 | |
Diluted no. of shares | 514,834,444 | 507,376,238 | 514,834,444 | 507,376,238 | |
Diluted earnings in USD per share | 0.51 | 0.42 | 0.93 | 0.93 |
1 “External Vessels in Disponent-Owner Pools” means vessels that are commercially managed by the Group in the Disponent-Owner Pool arrangements that are not Hafnia Vessels or TC Vessels. See Note 4 for details on accounting for pool arrangements.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
As at 30 June 2024 USD’000 | As at 31 December 2023 USD’000 | ||||
Vessels | 2,611,818 | 2,673,938 | |||
Dry docking and scrubbers | 71,588 | 68,159 | |||
Right-of-use assets – Vessels | 24,149 | 34,561 | |||
Other property, plant and equipment | 863 | 964 | |||
Total property, plant and equipment | 2,708,418 | 2,777,622 | |||
Intangible assets | 725 | 1,290 | |||
Total intangible assets | 725 | 1,290 | |||
Joint ventures | 74,654 | 60,172 | |||
Other investments | 23,531 | 23,953 | |||
Restricted cash1 | 13,445 | 13,381 | |||
Loans receivable from joint ventures | 57,670 | 69,626 | |||
Deferred tax assets | – | 36 | |||
Derivative financial instruments | 36,238 | 35,023 | |||
Total other non-current assets | 205,538 | 202,191 | |||
Total non-current assets | 2,914,681 | 2,981,103 | |||
Inventories | 107,691 | 107,704 | |||
Trade and other receivables | 623,619 | 589,710 | |||
Derivative financial instruments | 14,174 | 12,902 | |||
Cash at bank and on hand | 166,691 | 141,621 | |||
95,890 | 80,900 | ||||
Total current assets | 1,008,065 | 932,837 | |||
Total assets | 3,922,746 | 3,913,940 | |||
Share capital | 5,126 | 5,069 | |||
Share premium | 1,087,929 | 1,044,849 | |||
Contributed surplus | 537,112 | 537,112 | |||
Other reserves | 1,406 | 27,620 | |||
Treasury shares | (5,637) | (17,951) | |||
Retained earnings | 810,607 | 631,025 | |||
Total shareholders’ equity | 2,436,543 | 2,227,724 | |||
Borrowings | 809,038 | 1,025,023 | |||
Total non-current liabilities | 809,038 | 1,025,023 | |||
Current income tax liabilities | 1,384 | 8,111 | |||
Derivative financial instruments | 3,214 | 276 | |||
Trade and other payables | 346,656 | 385,478 | |||
Borrowings3 | 325,911 | 267,328 | |||
Total current liabilities | 677,165 | 661,193 | |||
Total liabilities | 1,486,203 | 1,686,216 | |||
Total shareholders’ equity and liabilities | 3,922,746 | 3,913,940 |
1 Restricted cash includes ash placed in debt service reserve and FFA collateral accounts.
2 The cash retained in the commercial pools represents cash in the pool bank accounts that are opened in the name of the Group’s pool management company and can only be used for the operation of vessels within the commercial pools.
3 Borrowings include USD 113.0 million of bank borrowings relating to pool financing, of which approximately USD 46.7 million is attributable to working capital advanced to external pool participants and has been adjusted in calculation of Net LTV.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Share Capital USD’000 | Share Premium USD’000 | Contributed Surplus USD’000 | Translation reserve USD’000 | Hedging reserve USD’000 | Treasury shares USD’000 | Capital reserves USD’000 | Share- based payment reserve USD’000 | Fair value reserve USD’000 | Retained earnings USD’000 | Total USD’000 | ||
Balance at 1 January 2024 | 5,069 | 1,044,849 | 537,112 | (63) | 39,312 | (17,951) | (25,137) | 3,788 | 9,720 | 631,025 | 2,227,724 | |
Transactions with owners | ||||||||||||
Purchase of treasury shares and issuance of shares | 57 | 43,080 | – | – | – | (19,685) | – | – | – | – | 23,452 | |
Equity-settled share-based payment | – | – | – | – | – | – | – | 1,664 | – | – | 1,664 | |
Dividends paid | – | – | – | – | – | – | – | – | – | (299,186) | (299,186) | |
Share options exercised | – | – | – | – | – | 31,999 | (28,763) | (2,721) | – | – | 515 | |
Total comprehensive income | ||||||||||||
Profit for the financial period | – | – | – | – | – | – | – | – | – | 478,768 | 478,768 | |
Other comprehensive income | – | – | – | 23 | 2,323 | – | – | – | 1,260 | – | 3,606 | |
Balance at 30 June 2024 | 5,126 | 1,087,929 | 537,112 | (40) | 41,635 | (5,637) | (53,900) | 2,731 | 10,980 | 810,607 | 2,436,543 | |
Balance at 1 January 2023 | 5,035 | 1,023,996 | 537,112 | 29 | 68,458 | (12,675) | (710) | 5,873 | – | 381,886 | 2,009,004 | |
Transactions with owners | ||||||||||||
Purchase of treasury shares and issuance of shares | 34 | 20,853 | – | – | – | (20,887) | – | – | – | – | – | |
Equity-settled share-based payment | – | – | – | – | – | – | – | 1,466 | – | – | 1,466 | |
Share options exercised | – | – | – | – | – | 30,072 | (16,631) | (4,086) | – | – | 9,355 | |
Dividends paid | – | – | – | – | – | – | – | – | – | (313,259) | (313,259) | |
Total comprehensive income | ||||||||||||
Profit for the financial period | – | – | – | – | – | – | – | – | – | 469,902 | 469,902 | |
Other comprehensive loss | – | – | – | (71) | (549) | – | – | – | – | – | (620) | |
Balance at 30 June 2023 | 5,069 | 1,044,849 | 537,112 | (42) | 67,909 | (3,490) | (17,341) | 3,253 | – | 538,529 | 2,175,848 |
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Condensed consolidated statement of cash flows
For the 3 months ended 30 June 2024 USD’000 | For the 3 months ended 30 June 2023 USD’000 | For the 6 months ended 30 June 2024 USD’000 | For the 6 months ended 30 June 2023 USD’000 | ||
Cash flows from operating activities | |||||
Profit for the financial period | 259,197 | 213,267 | 478,768 | 469,902 | |
Adjustments for: | |||||
- depreciation and amortisation charges | 54,846 | 51,868 | 108,975 | 103,861 | |
- loss/(gain) on disposal of assets | 100 | (19,828) | 100 | (56,515) | |
- interest income | (4,479) | (5,515) | (7,284) | (10,424) | |
- finance expense | 14,400 | 25,393 | 36,103 | 58,273 | |
- income tax expense | 1,572 | 1,513 | 3,315 | 3,436 | |
- share of profit of equity accounted investees, net of tax | (8,553) | (5,140) | (15,842) | (10,962) | |
- equity-settled share-based payment transactions | 1,105 | 652 | 1,664 | 1,466 | |
Operating cash flow before working capital changes | 318,188 | 262,210 | 605,799 | 559,037 | |
Changes in working capital: | |||||
- inventories | 3,922 | 8,971 | 13 | (11,139) | |
- trade and other receivables | (22,096) | 105,162 | (31,281) | (172,341) | |
- trade and other payables | 1,550 | (189,209) | (15,998) | 166,852 | |
Cash generated from operations | 301,564 | 187,134 | 558,533 | 542,409 | |
Income tax paid | (909) | (1,668) | (9,360) | (2,915) | |
Net cash provided by operating activities | 300,655 | 185,466 | 549,173 | 539,494 | |
Cash flows from investing activities | |||||
Acquisition of other investments | (308) | (160) | (661) | (410) | |
Purchase of property, plant and equipment | (13,309) | (93,850) | (28,674) | (95,905) | |
Purchase of intangible assets | – | – | (22) | – | |
Proceeds from disposal of property, plant and equipment | (100) | 47,541 | (100) | 143,253 | |
Proceeds from disposal of other investments | – | – | 2,343 | – | |
Interest income received | 3,189 | 4,352 | 4,987 | 7,848 | |
Loan to joint ventures | (5,163) | – | (7,744) | – | |
Repayment of loan by joint venture company | 21,976 | – | 21,976 | – | |
Dividend received from joint venture | – | 500 | – | 500 | |
Return of investment in joint venture | 1,360 | – | 1,360 | – | |
Net cash provided by/(used in) investing activities | 7,645 | (41,617) | (6,535) | 55,286 | |
Cash flows from financing activities | |||||
Proceeds from borrowings from external financial institutions | – | 126,106 | 30,000 | 200,530 | |
Repayment of borrowings to external financial institutions | (48,073) | (68,974) | (63,798) | (195,065) | |
Repayment of borrowings to non-related parties | – | (5,315) | – | (5,447) | |
Repayment of lease liabilities | (23,685) | (76,065) | (137,581) | (196,323) | |
Proceeds from exercise of employee share options | 111 | 334 | 520 | 8,912 | |
Payment of financing fees | (875) | (93) | (875) | (1,340) | |
Interest paid to external financial institutions | (13,111) | (13,805) | (26,976) | (48,721) | |
Interest paid to a third party | – | (5,642) | – | (5,645) | |
Other finance expense paid | (1,040) | (3,686) | (4,682) | (6,178) | |
Dividends paid | (175,666) | (154,055) | (299,186) | (313,259) | |
Net cash used in financing activities | (262,339) | (201,195) | (502,578) | (562,536) | |
Net increase/(decrease) in cash and cash equivalents | 45,961 | (57,346) | 40,060 | 32,244 | |
Cash and cash equivalents at beginning of the financial period | 216,620 | 369,915 | 222,521 | 280,325 | |
Cash and cash equivalents at end of the financial period | 262,581 | 312,569 | 262,581 | 312,569 | |
Cash and cash equivalents at the end of the financial period consists of: | |||||
Cash at bank and on hand | 166,691 | 241,465 | 166,691 | 241,465 | |
Cash retained in the commercial pools | 95,890 | 71,104 | 95,890 | 71,104 | |
Cash and cash equivalents at end of the financial period | 262,581 | 312,569 | 262,581 | 312,569 |
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Cash and cash flows
Cash at bank and on hand1 amounted to USD 166.7 million as of 30 June 2024 (30 June 2023: USD 241.5 million).
Operating activities generated a net cash inflow of USD 300.7 million in Q2 2024 (Q2 2023: USD 185.5 million).
Cash flows from operating activities were principally utilised for vessel drydocking costs, repayments of borrowings and interest, and payment of dividends to shareholders.
Investing activities resulted in a net cash inflow of USD 7.6 million in Q2 2024 (Q2 2023: net cash outflow of USD 41.6 million).
Financing activities resulted in a net cash outflow of USD 262.3 million in Q2 2024 (Q2 2023: net cash outflow of USD 201.2 million).
Hafnia will target a quarterly payout ratio of net profit, adjusted for extraordinary items, of:
● | 50% payout of net profit if Net loan-to-value is above 40%, |
● | 60% payout of net profit if Net loan-to-value is above 30% but equal to or below 40%, |
● | 80% payout of net profit if Net loan-to-value is above 20% but equal to or below 30%, and |
● | 90% payout of net profit if Net loan-to-value is equal to or below 20% |
Net loan-to-value is calculated as vessel bank and finance lease debt (excluding debt for vessels sold but pending legal completion), debt from the pool borrowing base facilities less cash at bank and on hand divided by broker vessel values (100% owned vessels).
The final amount of dividend is to be decided by the Board of Directors. In addition to cash dividends, the Company may buy back shares as part of its total distribution to shareholders.
In deciding whether to declare a dividend and determining the dividend amount, the Board of Directors will take into account the Group's capital requirements, including capital expenditure commitments, financial condition, general business conditions, legal restrictions, and any restrictions under borrowing arrangements or other contractual arrangements in place at the time.
Dividend for Q2
The board has set the quarterly payout ratio at 80% for Q2 2024.
1 Excluding cash retained in the commercial pools.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Coverage of earning days
As of 9 August 2024, 72% of the projected total operating days in Q3 2024 were covered at USD 34,934 per day. The tables below show the figures for Q3 2024, Q3 and Q4 2024 and the full year of 2025.
Hafnia Fleet1
Fleet overview | Q3 2024 | Q3 and Q4 2024 | 2025 | ||
Hafnia vessels (average during the period) | |||||
LR2 | 6.0 | 6.0 | 6.0 | ||
LR1 | 28.5 | 28.0 | 26.0 | ||
MR2 | 60.8 | 60.4 | 59.3 | ||
Handy3 | 24.0 | 24.0 | 24.0 | ||
Total | 119.3 | 118.4 | 115.3 | ||
Covered, % | |||||
LR2 | 68% | 34% | 0% | ||
LR1 | 56% | 29% | 0% | ||
MR2 | 74% | 50% | 11% | ||
Handy3 | 87% | 55% | 4% | ||
Total | 72% | 45% | 6% | ||
Covered rates4, USD per day | |||||
LR2 | 46,647 | 46,647 | – | ||
LR1 | 38,613 | 38,258 | – | ||
MR2 | 33,093 | 31,751 | 25,106 | ||
Handy3 | 33,842 | 32,737 | 24,155 | ||
Total | 34,934 | 33,534 | 24,975 |
The coverage figures include FFA positions which are mainly covering a triangulation route from Northwest Europe to the US Atlantic Coast (TC2), followed by a haul from the US Gulf back to the European Continent (TC14) for the MR fleet.
For the week beginning 12 August 2024, Hafnia’s pool earnings4 averaged:
• | USD 35,160 per day for the LR2 vessels, |
• | USD 40,592 per day for the LR1 vessels, |
• | USD 31,872 per day for the MR2 vessels, |
• | USD 21,250 per day for the Handy3 vessels. |
Fleet overview | Q3 2024 | Q3 and Q4 2024 | 2025 | ||
Joint ventures vessels (average during the period) | |||||
LR2 | 4.0 | 4.0 | 4.0 | ||
LR1 | 6.0 | 6.0 | 6.0 | ||
MR | 2.0 | 2.0 | 4.0 | ||
Total | 12.0 | 12.0 | 14.0 |
1 Excludes joint ventures vessels.
2 Inclusive of nine IMO II vessels.
3 Inclusive of 18 IMO II vessels.
4 Covered rates and pool earnings do not include any IFRS 15 load to discharge adjustments
5 The figures are presented on a 100% basis. The joint ventures vessels are owned through Hafnia’s 50% participation in the Vista Shipping, H&A Shipping and Ecomar joint ventures.
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Coverage of earning days CONTINUED
Fleet overview | Q3 2024 | Q3 and Q4 2024 | 2025 | ||
Covered, % | |||||
LR2 | 100% | 100% | 100% | ||
LR1 | 42% | 21% | 0% | ||
MR | 100% | 100% | 100% | ||
Total | 71% | 60% | 57% | ||
Covered rates1, USD per day | |||||
LR2 | 25,742 | 25,742 | 25,742 | ||
LR1 | 44,274 | 44,274 | – | ||
MR | 15,610 | 15,610 | 19,878 | ||
Total | 28,828 | 26,156 | 22,818 |
Tanker segment results
LR2 | Q3 2023 | Q4 20232 | Q1 2024 | Q2 2024 | |
Operating days (owned) | 552 | 550 | 483 | 544 | |
Operating days (TC-in) | – | – | – | – | |
31,272 | 38,884 | 52,813 | 60,116 | ||
Spot TCE (USD per operating day)3 | 33,858 | 41,958 | 51,668 | 60,116 | |
TC-out TCE (USD per operating day)3 | 28,599 | 30,163 | – | – | |
Calendar days (excluding TC-in) | 552 | 552 | 546 | 546 | |
OPEX (USD per calendar day) | 8,348 | 6,984 | 8,550 | 7,626 | |
LR1 | Q3 2023 | Q4 20232 | Q1 2024 | Q2 2024 | |
Operating days (owned) | 2,240 | 2,253 | 2,196 | 2,183 | |
Operating days (TC-in) | 350 | 359 | 350 | 331 | |
TCE (USD per operating day)3 | 30,198 | 32,184 | 46,749 | 46,986 | |
Spot TCE (USD per operating day)3 | 30,530 | 32,532 | 46,454 | 46,986 | |
TC-out TCE (USD per operating day)3 | 23,160 | 22,377 | – | – | |
Calendar days (excluding TC-in) | 2,298 | 2,300 | 2,275 | 2,275 | |
OPEX (USD per calendar day) | 8,628 | 7,601 | 8,178 | 8,048 | |
MR4 | Q3 2023 | Q4 20232 | Q1 2024 | Q2 2024 | |
Operating days (owned) | 4,416 | 4,442 | 4,355 | 4,484 | |
Operating days (TC-in) | 920 | 920 | 888 | 910 | |
TCE (USD per operating day)3 | 29,141 | 31,355 | 32,888 | 35,913 | |
Spot TCE (USD per operating day)3 | 29,780 | 32,710 | 34,237 | 38,077 | |
TC-out TCE (USD per operating day)3 | 26,267 | 24,951 | 26,211 | 25,674 | |
Calendar days (excluding TC-in) | 4,508 | 4,541 | 4,550 | 4,550 | |
OPEX (USD per calendar day) | 8,093 | 8,131 | 7,812 | 8,050 | |
HANDY5 | Q3 2023 | Q4 20232 | Q1 2024 | Q2 2024 | |
Operating days (owned) | 2,199 | 2,207 | 2,184 | 2,183 | |
Operating days (TC-in) | – | – | – | – | |
TCE (USD per operating day)3 | 26,780 | 25,459 | 28,305 | 33,358 | |
Spot TCE (USD per operating day)3 | 27,227 | 25,383 | 28,475 | 34,474 | |
TC-out TCE (USD per operating day)3 | 21,664 | 26,301 | 26,428 | 25,447 | |
Calendar days (excluding TC-in) | 2,208 | 2,208 | 2,184 | 2,184 | |
OPEX (USD per calendar day) | 7,753 | 7,329 | 7,569 | 8,045 |
1 Covered rates and pool earnings do not include any IFRS 15 load to discharge adjustments
2 Q4 2023 figures onwards include IFRS 15 load to discharge adjustments, while previous quarters were not adjusted. Operating revenue from Q4 2023 onwards is adjusted for pool allocation while previous quarters were not adjusted.
3 TCE represents gross TCE income after adding back pool commissions; See Non-IFRS Measures in Note 17.
4 Inclusive of IMO II MR vessels.
5 Inclusive of IMO II Handy vessels.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Tanker segment results CONTINUED
Specialized | Q3 2023 | Q4 20231 | Q1 2024 | Q2 2024 | |
Operating days (owned) | – | – | – | – | |
Operating days (TC-in) | 39 | – | – | – | |
TCE (USD per operating day)2 | 10,068 | – | – | – | |
Spot TCE (USD per operating day)2 | 10,068 | – | – | – | |
TC-out TCE (USD per operating day)2 | – | – | – | – | |
Calendar days (excluding TC-in) | – | – | – | – | |
OPEX (USD per calendar day) | – | – | – | – |
The Group’s results are largely dependent on the worldwide market for transportation of refined oil products. Market conditions for shipping activities are typically volatile and, as a consequence, the results may vary considerably from year to year. The market in broad terms is dependent upon two factors: the supply of vessels and the demand for oil products. The supply of vessels depends on the number of newbuilds entering the market, the demolition of older tonnage and legislation that limits the use of older vessels or sets new standards for vessels used in specific trades. The demand side depends mainly on developments in global economic activity.
The Group is also exposed to risk in respect of increases in operating costs, such as fuel oil costs. Fuel oil prices are affected by the global political and economic environment. For voyage contracts, the current fuel costs are priced into the contracts. Other risks that Management takes into account are interest rate risk, credit risk, liquidity risk and capital risk. These risks, along with mitigation strategies, are further described in section 2.3 of the Annual Report 2023 and note 26 of the consolidated financial statements of the Group for the financial year ended 2023 and are principal risks for the remaining six months of 2024.
We confirm, to the best of our knowledge, that the condensed set of consolidated interim financial information (‘Interim Financial Information’) for the period from 1 January to 30 June 2024 has been prepared in accordance with IAS 34 – Interim Financial Reporting, and gives a true and fair view of the Group’s assets, liabilities, financial position and income statement as a whole. We also confirm, to the best of our knowledge, that the Interim Financial Information includes a fair review of important events that have occurred during the six months period ended 30 June 2024 and their impact on the Interim Financial Information, a description of the principal risks and uncertainties for the remaining six months of the financial year, and major related parties transactions.
Andreas Sohmen-Pao
John Ridgway
Peter Read
Su Yin Anand
Erik Bartnes
1 Q4 2023 figures onwards include IFRS 15 load to discharge adjustments; while previous quarters were not adjusted. Operating revenue from Q4 2023 onwards is adjusted for pool allocation while previous quarters were not adjusted.
2 TCE represents gross TCE income after adding back pool commissions; See Non-IFRS Measures in Note 17.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
These notes form an integral part of and should be read in conjunction with the accompanying condensed consolidated interim financial information.
Hafnia Limited (the “Company”), is incorporated and domiciled in Bermuda. The address of its registered office is Washington Mall Phase 2, 4th Floor, Suite 400, 22 Church Street, HM 1189, Hamilton HM EX, Bermuda.
The principal activity of the Company is that of investment holding. The principal activities of its subsidiaries are shipowning and chartering.
This Interim Financial Information was authorised for issue by the Board of Directors of the Company on 23 August 2024.
Statement of compliance
The Interim Financial Information has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’. The Interim Financial Information should be read in conjunction with the annual audited financial statements for the financial year ended 31 December 2023, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”).
New standard and amendments to published standards, effective in 2024 and subsequent years
The Group has applied the following IFRSs, amendments to and interpretations of IFRS for the first time for the annual period beginning on 1 January 2024:
(a) | Amendments: |
- | Amendments to IFRS 16 Lease Liability in a Sale and Leaseback |
- | Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Non-Current and Non-current Liabilities with Covenants |
- | Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures – Supplier Finance Arrangements |
(b) | New standards: |
- | IFRS S1 – General Requirements for Disclosure of Sustainability-related Financial Information |
- | IFRS S2 – Climate-related Disclosures |
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Global minimum top-up tax
Management has assessed that the amendments to IAS 12 Income Taxes (b) International Tax Reform – Pillar Two Model Rules are applicable to the Group as it is a large multinational enterprise that has consolidated revenues of more than USD 750 million in at least two out of the last four years.
The application of these amendments to standards and interpretations does not have a material effect on the Interim Financial Information.
A number of new standards, interpretations, and amendments to standards will become effective for annual periods beginning on or after 1 January 2025, and early adoption is permitted. In preparing these consolidated financial statements, the Group has not early adopted any new or amended standards or interpretations. The Group intends to adopt these new and amended standards and interpretations, when they become effective.
The Interim Financial Information for the six-month period from 1 January 2024 to 30 June 2024 has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’. The Interim Financial Information should be read in conjunction with the annual audited financial statements for the financial year ended 31 December 2023, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”). The Interim Financial Information does not include all the information required for a complete set of financial statements prepared in accordance with IFRS standards. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group’s financial position and performance since the last annual financial statements.
In the preparation of this set of Interim Financial Information, the same accounting policies have been applied as those used in the preparation of the annual consolidated financial statements for the financial year ended 31 December 2023.
The condensed consolidated Interim Financial Information for the six-month period from 1 January 2024 to 30 June 2024 has not been audited or reviewed by the Group’s auditors.
Critical accounting judgements and estimates
The following are the critical judgements, apart from those involving estimations, that management has made in the process of applying the Group’s accounting policies and which have the most significant effect on the amounts recognised in the financial statements.
Accounting for pool arrangements
The Group is involved in two types of commercial pool arrangements: 1) pool arrangements that are managed by the Group under the “agent-to-owner” model, and 2) pool arrangements that are managed by the Group under the “disponent-owner” model (“Disponent-Owner Pools”).
For pool arrangements that are managed by the Group, Hafnia operates as a pool manager for eight commercial pools:
(1) | Long Range II (“LR2”) Pool |
(2) | Long Range I (“LR1”) Pool |
(3) | Panamax Pool |
(4) | Medium Range (“MR”) Pool |
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Note 4: Material accounting policies CONTINUED
(5) | Handy size (“Handy”) Pool |
(6) | Chemical handy size (“Chemical-Handy”) Pool |
(7) | Chemical medium range (“Chemical-MR”) Pool |
(8) | Specialized Pool |
The pools are managed by Hafnia through its pool management companies that are wholly owned subsidiaries, as the pool manager. There are separate pool agreements entered into between the pool manager and the relevant pool participants. The pool manager negotiates charters with customers primarily in the spot market, however it may also arrange short duration time charters.
The objective of the commercial pool set up is to facilitate the commercial operation, employment, and marketing of the pool’s vessels. This is achieved via the optimal utilisation of the pool vessels due to improved scheduling to reduce ballast legs and bulk purchase of goods and services for voyage expenses, thus creating economies of scale, improved flexibility, efficiency and price competitiveness. Shipowners contribute their vessels to the pool and the pool is managed by the pool manager under the authority of the Pool Board.
For pool arrangements under the “agent-to-owner” model, management has performed a key assessment to determine who is the principal and agent in these pool arrangements. Indicators that the Group, as the pool manager, is an agent in a pool arrangement are:
• | Based on the pool agreements under the “agent-to-owner” model, the decisions over the relevant activities of the pool that are determined to significantly affect the pool’s returns are made by the respective Pool Boards, which are represented by pool participants; |
• | Although the pool manager makes decisions over the day-to-day operations of the pool, the pool manager only acts within the pre-defined mandates and authority limits set by the Pool Board, for which the Pool Board’s approving rights are substantive; |
• | The decisions of the pool manager are not for the relevant activities of the pool and the pool manager has limited discretion over pricing as the prices are highly dependent on the market published price for charter contracts; |
• | The pool manager is only given authority to decide on the prices with the objective of efficient pool management; and |
• | The Pool Board’s decisions have practical ability to prevent the pool manager from directing the pool’s relevant activities and exercising power on its own behalf. |
The Group has evaluated that it has limited control as the pool manager and is hence an agent in the respective commercial pool arrangements. In such arrangements, the Group as the pool manager does not consolidate the pools. Instead, the Group only recognises the pool management fees as other operating income. On the balance sheet, the Group recognises the pool’s assets and liabilities over which the Group, as pool manager, has legal rights and obligations respectively. This includes all cash balances of the pool as the pool bank accounts are opened in the name of the pool manager; and trade payables (other than those relating to fuel oil) for which contracts are entered into in the name of the pool manager.
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As the shipowner that places its own vessels in the pools, the Group recognises the gross revenue and voyage expenses earned pertaining to its vessels placed in the pools; and adjustments due to pool allocations recognised separately as “pool allocated gain/loss”. These adjustments relate to revenue from time charters and voyage charters less voyage expenses comprising primarily brokers’ commission, fuel oil and port charges. On the balance sheet, the Group recognises the assets and liabilities over which the Group, as shipowners, has legal rights and obligations respectively. This includes the trade receivables from end charterers for which the contracts are entered into in its own name as shipowners; and fuel oil as inventory and its corresponding payables, as the pool manager purchases fuel oil as an agent on behalf of shipowners based on the contractual terms of the Pool Agreements under the “agent-to-owner” model and the shipowner having the primary responsibility for the fuel oil obligations.
During the financial year ended 31 December 2023, the Group changed the Handy Pool, MR Pool, LR1 Pool and LR2 Pool from the “agent-to-owner” model to the “disponent-owner” model, as management believes that it would lead to an improvement in operating efficiency and access to working capital facilities.
For pool arrangements under the “disponent-owner” model (“Disponent-Owner Pools”), the key changes in the pool agreements from the “agent-to-owner” model are:
• | Establishing a time-charter arrangement for the vessels in the Disponent-Owner Pools between the pool participants and the pool manager; |
• | The pool manager, as the “disponent-owner” of the vessels, has the right to obtain substantially all of the economic benefits from the use of the vessels in the Disponent-Owner Pools, as the pool manager is the contractual and legal entity who charters in vessels from the pool participants and subsequently charters out the vessels to the external charterers under its own name as the “disponent-owner”; |
• | The pool manager, as the “disponent-owner” of the vessels, also has the right to direct the use of the vessels in the Disponent-Owner Pools, including having the right to direct how and for what purpose the vessels will be used; |
The Group has evaluated that the time-charter arrangement constitutes a lease under IFRS 16 – Leases to the pool manager of the Disponent-Owner Pools. Correspondingly, management has assessed that the rights conferred from the pool agreements under the “disponent-owner” model provided the pool manager with the control of a right to a service to be performed using the vessels in the Disponent-Owner Pools for which it has control over, for the end charterers and hence allowing the pool manager to recognise the revenue as a principal in line with IFRS 15 – Revenue from Contracts with Customers.
In such arrangements, the Group as the pool manager recognises the gross revenue and voyage expenses earned pertaining to the vessels placed by the Group in the Disponent-Owner Pools as “Revenue (Hafnia Vessels and TC Vessels)” and “Voyage expenses (Hafnia Vessels and TC Vessels)” respectively, and adjustments due to pool allocations recognised separately as “pool allocated gain/loss”; the gross revenue and voyage expenses earned pertaining to the external vessels placed by pool participants other than the Group in the Disponent-Owner Pools as “Revenue (External Vessels in Disponent-Owner Pools)” and “Voyage expenses (External Vessels in Disponent-Owner Pools)” respectively; and expenses relating to pool distributions to external pool participants other than the Group in the Disponent-Owner Pools separately as “Pool distributions for External Vessels in Disponent-Owner Pools”.
On the balance sheet, the Group recognises the pool’s assets and liabilities over which the Group, as pool manager, has legal rights and obligations respectively. This includes all cash balances of the pool as the pool bank accounts are opened in the name of the pool manager; all trade receivables from end charterers for which contracts are entered into in the name of the pool manager as the “disponent-owner”; the trade payables for which contracts are entered into in the name of the pool manager; and fuel oil as inventory and its corresponding payables, as the pool manager purchases fuel oil as the “disponent owner” of the vessels based on the contractual terms of the Pool Agreements under the “disponent-owner” model.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Note 4: Material accounting policies CONTINUED
Identification of cash-generating units
The Group organizes the commercial management of the fleet of vessels into eight individual commercial pools: LR2, LR1, Panamax, MR, Handy, Chemical-MR, Chemical-Handy and Specialised. For the financial period ended 30 June 2024, there are no Hafnia Vessels or TC Vessels in the Specialised Pool. The Group has assessed that each individual commercial pool constitutes a separate cash-generating unit (“CGU”). This is due to 1) the vessels in each individual pool generating cashflows that are largely interdependent with each other, as the pool arrangements create operational dependencies between vessels in each segment as the pool manager is able to deploy all the vessels to gain efficiencies for the entire fleet of vessels in the pool ; 2) the decisions of the pool manager are made solely for the benefit of the entire commercial pool and not for individual vessels; and 3) each individual pool is managed on a portfolio basis to optimise performance and for internal and external management reporting.
Time-chartered in vessels which are recognised as ROU assets by the Group and subsequently deployed in the commercial pools are included as part of the respective commercial pool CGUs based on the above assessment. For vessels outside the commercial pools and deployed on a time-charter basis, each of these vessels constitutes a separate CGU.
Impairment/reversals of impairment of non-financial assets
Property, plant and equipment and right-of-use assets are tested for impairment whenever there is any objective evidence or indication that these assets may be impaired or a reversal of previously recognised impairment charge may be required. The recoverable amount of an asset, and where applicable, a cash-generating unit (“CGU”), is determined based on the higher of fair value less costs to sell and value-in-use calculations prepared on the basis of management’s assumptions and estimates.
All impairment calculations demand a high degree of estimation, which include assessments of the expected cash flows arising from such assets under various modes of deployment, and the selection of discount rates. Changes to these estimates may significantly impact the impairment charges recognised, and future changes may lead to reversals of any previously recognised impairment charges. The Group views that the forecast of future freight rates, representing the main driver of recoverable amounts of the Group’s vessels to be inherently difficult to estimate. This is further complicated by the volatility in oil prices caused by geopolitics and macroeconomic forces, together with the cyclical nature of freight rates prevailing in the tankers market.
Vessel life and residual value
The Group depreciates the vessels on a straight-line basis after deduction of residual values over the ship’s estimated useful life of 25 years, from the date the ship was originally delivered from the shipyard. Dry docking costs are generally depreciated over 2.5 to 5 years depending on the age and serviceability of the vessels. Residual value is estimated as the lightweight tonnage of each vessel multiplied by the scrap value. The residual values of the vessels are reassessed by management at the end of each reporting period based on the prevailing and historical steel prices.
The useful life and residual value are critical accounting estimates as they directly impact the amount of depreciation expense to be presented in the financial statements. Due to the size of the Group’s fleet of owned vessels, the impact could be material depending on the estimates adopted by Management.
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Note 5: Revenue
For the 3 months ended 30 June 2024 USD’000 | For the 3 months ended 30 June 2023 USD’000 | For the 6 months ended 30 June 2024 USD’000 | For the 6 months ended 30 June 2023 USD’000 | ||
Hafnia Vessels and TC Vessels | |||||
Revenue from voyage charter | 545,846 | 442,607 | 1,025,759 | 939,178 | |
Revenue from time charter | 17,252 | 35,592 | 59,131 | 61,622 | |
Total revenue | 563,098 | 478,199 | 1,084,890 | 1,000,800 |
The Group’s revenue is generated from the following main business segments: LR2 Product Tankers, LR1 Product Tankers, MR Product Tankers (inclusive of IMO II vessels) and Handy Product Tankers (inclusive of IMO II vessels).
Disaggregation of revenue by business segments is presented in Note 14.
Right-of-use Assets – Vessels USD’000 | Vessels USD’000 | Dry docking and scrubbers USD’000 | Others USD’000 | Total USD’000 | ||
Cost | ||||||
At 1 January 2024 | 199,582 | 3,573,265 | 143,375 | 1,495 | 3,917,717 | |
Additions | – | 3,324 | 11,996 | 45 | 15,365 | |
Write-off on completion of dry docking cycle | – | – | (7,946) | – | (7,946) | |
At 31 March 2024/1 April 2024 | 199,582 | 3,576,589 | 147,425 | 1,540 | 3,925,136 | |
Additions | 10,836 | 3,784 | 9,184 | 15 | 23,819 | |
Write-off on completion of dry docking cycle | – | – | (3,501) | – | (3,501) | |
At 30 June 2024 | 210,418 | 3,580,373 | 153,108 | 1,555 | 3,945,454 | |
Accumulated depreciation and impairment charges | ||||||
At 1 January 2024 | 165,021 | 899,327 | 75,216 | 531 | 1,140,095 | |
Depreciation charge | 10,711 | 34,393 | 8,605 | 84 | 53,793 | |
Write-off on completion of dry docking cycle | – | – | (7,946) | – | (7,946) | |
At 31 March 2024/1 April 2024 | 175,732 | 933,720 | 75,875 | 615 | 1,185,942 | |
Depreciation charge | 10,537 | 34,835 | 9,146 | 77 | 54,595 | |
Write-off on completion of dry docking cycle | – | – | (3,501) | – | (3,501) | |
At 30 June 2024 | 186,269 | 968,555 | 81,520 | 692 | 1,237,036 | |
Net book value | ||||||
At 30 June 2024 | 24,149 | 2,611,818 | 71,588 | 863 | 2,708,418 |
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Right-of-use Assets – Vessels USD’000 | Vessels USD’000 | Dry docking and scrubbers USD’000 | Others USD’000 | Total USD’000 | ||
Cost | ||||||
At 1 January 2023 | 187,730 | 3,698,658 | 138,001 | 1,369 | 4,025,758 | |
Additions | – | 1,592 | 408 | 55 | 2,055 | |
Disposal of vessel | – | (164,795) | (7,481) | – | (172,276) | |
Reclassification to assets held for sale | – | (60,321) | (1,729) | – | (62,050) | |
At 31 March 2023/1 April 2023 | 187,730 | 3,475,134 | 129,199 | 1,424 | 3,793,487 | |
Additions | – | 86,445 | 7,405 | 4 | 93,854 | |
Disposal of vessel | – | (58,712) | (3,340) | – | (62,052) | |
Write-off on completion of dry docking cycle | – | – | (1,575) | – | (1,575) | |
At 30 June 2023/1 July 2023 | 187,730 | 3,502,867 | 131,689 | 1,428 | 3,823,714 | |
Additions | – | 33,966 | 8,400 | 51 | 42,417 | |
Write-off on completion of dry docking cycle | – | – | (2,727) | – | (2,727) | |
At 30 September 2023/1 October 2023 | 187,730 | 3,536,833 | 137,362 | 1,479 | 3,863,404 | |
Additions | 11,852 | 36,432 | 9,618 | 16 | 57,918 | |
Disposal of vessel | – | (60,321) | (1,696) | – | (62,017) | |
Write-off on completion of dry docking cycle | – | – | (3,638) | – | (3,638) | |
Reclassification of assets held for sale to disposal of vessel | – | 60,321 | 1,729 | – | 62,050 | |
At 31 December 2023 | 199,582 | 3,573,265 | 143,375 | 1,495 | 3,917,717 | |
Accumulated depreciation and impairment charges | ||||||
At 1 January 2023 | 119,826 | 970,339 | 58,791 | 239 | 1,149,195 | |
Depreciation charge | 11,232 | 33,153 | 7,204 | 72 | 51,661 | |
Disposal of vessel | – | (111,179) | (2,072) | – | (113,251) | |
Reclassification to assets held for sale | – | (49,015) | (482) | – | (49,497) | |
At 31 March 2023/1 April 2023 | 131,058 | 843,298 | 63,441 | 311 | 1,038,108 | |
Depreciation charge | 11,292 | 33,250 | 6,935 | 68 | 51,545 | |
Disposal of vessel | – | (46,287) | (1,852) | – | (48,139) | |
Write-off on completion of dry docking cycle | – | – | (1,575) | – | (1,575) | |
At 30 June 2023/1 July 2023 | 142,350 | 830,261 | 66,949 | 379 | 1,039,939 | |
Depreciation charge | 11,335 | 34,572 | 7,158 | 70 | 53,135 | |
Write-off on completion of dry docking cycle | – | – | (2,727) | – | (2,727) | |
At 30 September 2023/1 October 2023 | 153,685 | 864,833 | 71,380 | 449 | 1,090,347 | |
Depreciation charge | 11,336 | 34,494 | 7,474 | 82 | 53,386 | |
Write-off on completion of dry docking cycle | – | – | (3,638) | – | (3,638) | |
Disposal of vessel | – | (49,015) | (482) | – | (49,497) | |
Reclassification of assets held for sale to disposal of vessel | – | 49,015 | 482 | – | 49,497 | |
At 31 December 2023 | 165,021 | 899,327 | 75,216 | 531 | 1,140,095 | |
Net book value | ||||||
At 31 December 2023 | 34,561 | 2,673,938 | 68,159 | 964 | 2,777,622 |
a. | The Group organises the commercial management of the fleet of product tanker vessels into eight (2023: seven) individual commercial pools: LR1, Panamax, LR2, MR, Handy, Chemical-MR, Chemical-Handy and Specialized (2023: LR1, LR2, MR, Handy, Chemical-MR, Chemical-Handy and Specialized). Each individual commercial pool constitutes a separate cash-generating unit (“CGU”). For vessels deployed on a time-charter basis outside the commercial pools, each of these vessels constitutes a separate CGU. |
Management is required to assess whenever events or changes in circumstances indicate that the carrying value of these CGUs may not be recoverable. Management measures the recoverability of each CGU by comparing its carrying amount to its ‘recoverable value’, being the higher of its fair value less costs of disposal or value in use (“VIU”) based on future discounted cash flows that the CGU is expected to generate over its remaining useful life.
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
As at 30 June 2024, the Group assessed whether these CGUs have indicators of impairment by reference to internal and external factors. The market valuation of the fleet of vessels, as appraised by independent shipbrokers, is one key test performed by the Group.
Based on this assessment, alongside with other industry factors, the Group concluded that there is no indication that any impairment loss or reversal of previously recognised impairment loss is needed for the 6 months ended 30 June 2024 (6 months ended 30 June 2023: USD Nil).
b. | The Group has mortgaged vessels with a total carrying amount of USD 2,470.1 million as at 30 June 2024 (31 December 2023: USD 2,491.8 million) as security over the Group’s bank borrowings. |
c. | There were additions of USD 10.8 million to right-of-use assets – vessels – as at 30 June 2024 (6 months ended 30 June 2023: USD Nil). |
d. | As at 30 June 2024, the Group has time chartered-in six MRs and two LR1s with purchase options; and two MRs and one LR1 without purchase options. These chartered-in vessels are recognised as right-of-use assets. |
The Group has firm charters in place up till 2025 for these vessels. The current and next average purchase option price are as follows:
USD’000 | Next average purchase option price | ||||
LR1 | 41,167 | 40,667 | |||
MR | 33,064 | 32,681 |
The time chartered-in days and average time charter rates for these vessels are as follows:
2024 | 2025 | ||||
TC in (Days)2 | |||||
LR1 (with purchase option) | 732 | 425 | |||
LR1 (without purchase option) | 323 | – | |||
MR (with purchase option) | 2,165 | 649 | |||
MR (without purchase option) | 636 | – | |||
Average TC in rate (USD/Day) | |||||
LR1 (with purchase option) | 18,750 | 19,100 | |||
LR1 (without purchase option) | 17,500 | – | |||
MR (with purchase option) | 16,125 | 16,467 | |||
MR (without purchase option) | 17,314 | – |
a. | Authorised share capital |
The total authorised number of shares is 750,000,000 (30 June 2023: 750,000,000) common shares at par value of USD 0.01 per share.
1 The purchase option price decreases by a fixed amount per year, or on a pro-rata basis based on individual contract terms. Prior notice period of three to four months are required before exercise of options. The value of the purchase options amount to USD 108 mil as at the end of the current reporting period.
2 Based on firm charter period and does not include optional periods exercisable by Hafnia.
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b. | Issued and fully paid share capital |
Numbers of shares | Share capital USD’000 | Share premium USD’000 | Total USD’000 | |||
At 1 January 2023 | 503,388,593 | 5,035 | 1,023,996 | 1,029,031 | ||
Issuance of shares | 3,431,577 | 34 | 20,853 | 20,887 | ||
At 30 June 2023 | 506,820,170 | 5,069 | 1,044,849 | 1,049,918 | ||
At 1 January 2024 | 506,820,170 | 5,069 | 1,044,849 | 1,049,918 | ||
Issuance of shares | 5,743,362 | 57 | 43,080 | 43,137 | ||
At 30 June 2024 | 512,563,532 | 5,126 | 1,087,929 | 1,093,055 |
On 28 February 2023, the Company entered into a share lending agreement with BW Group Limited (“BW Group”), whereby BW Group lent 3,431,577 shares of the Company. The borrowed shares were redelivered by way of the Company issuing new shares to BW Group at a subscription price of USD 0.01 per share. Following this transaction, the Company had 3,431,577 newly issued shares and 3,431,577 treasury shares.
On 1 March 2023, the Company settled these borrowed shares by way of issuing 3,431,577 new ordinary shares to BW Group. Following the issuance of the new ordinary shares, there were 506,820,170 issued shares in the Company, each with a nominal value of USD 0.01, all of which have been validly and legally issued and fully paid.
On 20 December 2023, the Company entered into another share lending agreement with BW Group, whereby BW Group lent 3,431,577 shares of the Company. Following this transaction, the Company had 3,431,577 treasury shares. The borrowed shares would be redelivered by way of the Company issuing new shares to BW Group at a subscription price of USD 0.01 per share.
On 2 January 2024, the Company settled borrowed shares from BW Group by way of issuing 3,431,577 new ordinary shares. Following the issuance of the new ordinary shares, there were 510,251,747 issued shares in the Company, each with a nominal value of USD 0.01, all of which have been validly and legally issued and fully paid.
On 29 May 2024, the Company entered into another share lending agreement with BW Group whereby BW Group lent 2,311,785 shares of the Company. The borrowed shares would be redelivered by way of the Company issuing new shares to BW Group at a subscription price of USD 0.01 per share.
On 27 June 2024, the Company settled borrowed shares from BW Group by way of issuing 2,311,785 new ordinary shares. Following the issuance of the new ordinary shares, there are 512,563,532 issued shares in the Company, each with a nominal value of USD 0.01, all of which have been validly and legally issued and fully paid.
All issued common shares are fully paid. The newly issued shares rank pari passu with the existing shares.
c. | Other reserves |
(i) | As of 30 June 2024 USD’000 | As of 31 December 2023 USD’000 | |||
Composition: | |||||
Translation reserve | (40) | (63) | |||
Hedging reserve | 41,635 | 39,312 | |||
Share based payment reserve | 2,731 | 3,788 | |||
Capital reserve | (53,900) | (25,137) | |||
Fair value reserve | 10,980 | 9,720 | |||
Total | 1,406 | 27,620 |
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
(ii) | Movements of the reserves are as follows: | For the 6 months ended 30 June 2024 USD’000 | For the 6 months ended 30 June 2023 USD’000 | ||
Hedging reserve | |||||
At beginning of the financial period | 39,312 | 68,458 | |||
Fair value gains on cash flow hedges | 18,747 | 16,143 | |||
Reclassification to profit or loss | (16,424) | (16,692) | |||
At end of the financial period | 41,635 | 67,909 |
As at 30 June 2024 USD’000 | As at 31 December 2023 USD’000 | |||
Current | ||||
Bank borrowings | 248,920 | 174,004 | ||
Sale and leaseback liabilities (accounted for as financing transaction) | 49,491 | 57,305 | ||
Other lease liabilities | 27,500 | 36,019 | ||
Total current borrowings | 325,911 | 267,328 | ||
Non-current | ||||
Bank borrowings | 290,399 | 398,507 | ||
Sale and leaseback liabilities (accounted for as financing transaction) | 517,841 | 622,174 | ||
Other lease liabilities | 798 | 4,342 | ||
Total non-current borrowings | 809,038 | 1,025,023 | ||
Total borrowings | 1,134,949 | 1,292,351 |
As at 30 June 2024, bank borrowings consist of ten credit facilities from external financial institutions, namely USD 473 million, USD 374 million, USD 216 million, USD 106 million, USD 84 million, USD 39 million, USD 40 million, USD 303 million and two borrowing base facilities (31 December 2023: USD 473 million, USD 374 million, USD 216 million, USD 106 million, USD 84 million, USD 39 million, USD 40 million, USD 303 million and two borrowing base facilities respectively). These facilities are secured by the Group’s fleet of vessels. The table below summarises key information of the bank borrowings:
Outstanding amount USD m | Maturity date | ||||
Facility amount | |||||
USD 473 million facility | 100.8 | ||||
- USD 413 million term loan | 2026 | ||||
- USD 60 million revolving credit facility | 2026 | ||||
USD 374 million facility | – | ||||
- USD 100 million revolving credit facility | 2028 | ||||
USD 216 million facility | 137.4 | 2026 | |||
USD 106 million facility | 84.0 | 2025 | |||
USD 84 million facility | 52.7 | ||||
- USD 68 million term loan | 2026 | ||||
- USD 16 million revolving credit facility | 2026 | ||||
USD 39 million facility | 17.1 | ||||
- USD 30 million term loan | 2025 | ||||
- USD 9 million revolving credit facility | 2025 | ||||
USD 40 million facility | 37.1 | 2029 | |||
USD 303 million facility | – | ||||
- USD 303 million revolving credit facility | 2029 | ||||
Up to USD 175 million borrowing base facility Up to USD 175 million borrowing base facility (with an accordion option of up to USD 75 million) | 52.8 59.7 | 2024 |
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
The table below summarises the repayment profile of the bank borrowings:
For the financial year ended 31 December 2024 | For the financial year ended 31 December 2025 | ||||
Repayment profile USD’000 | |||||
14,496 | 28,992 | ||||
USD 216 million facility | 6,300 | 12,600 | |||
USD 106 million facility | 4,308 | 79,692 | |||
USD 84 million facility | 3,120 | 6,240 | |||
USD 39 million facility | 1,669 | 15,464 | |||
USD 40 million facility | 1,437 | 2,874 | |||
Up to USD 175 million borrowing base facility Up to USD 175 million borrowing base facility (with an accordion option of up to USD 75 million) | 53,000 60,000 | – |
As of 30 June 2024, bank borrowings of joint ventures consist of six credit facilities (31 December 2023: six credit facilities) from external financial institutions. The table below summarises key information of the joint ventures’ bank borrowings:
Outstanding amount USD m | Maturity date | ||||
Facility amount | |||||
Vista Shipping joint venture | |||||
USD 51.8 million facility | 31.5 | 2031 | |||
USD 111.0 million facility | 79.1 | 2032 | |||
USD 89.6 million facility | 83.7 | 2033 | |||
USD 88.5 million facility | 86.0 | 2031 | |||
H&A Shipping joint venture | |||||
USD 22.1 million facility | 18.0 | 2026 | |||
USD 23.5 million facility | 19.8 | 2028 |
For the financial year ended 31 December 2024 | For the financial year ended 31 December 2025 | ||||
Repayment profile USD’000 | |||||
Vista Shipping joint venture | |||||
USD 51.8 million facility | 1,727 | 3,453 | |||
USD 111.0 million facility | 3,700 | 7,400 | |||
USD 89.6 million facility | 2,635 | 5,271 | |||
USD 88.5 million facility | 2,458 | 4,917 | |||
H&A Shipping joint venture | |||||
USD 22.1 million facility | 737 | 1,473 | |||
USD 23.5 million facility | 735 | 1,470 |
As at 30 June 2024, the finance lease liabilities consist of various facilities provided by external leasing houses. The vessels under these facilities are legally owned by the leasing houses and leased back to Hafnia. The maturity dates of the facilities range from 2029 to 2033.
The carrying amounts relating to the 12 LR1 vessels was USD 339.5 million (31 December 2023: USD 354.2 million), 10 CTI vessels was USD 181.7 million (31 December 2023: USD 276.9 million), and other finance leases was USD 46.1 million (31 December 2023: USD 48.5 million).
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Interest rates
The weighted average effective interest rates per annum of total borrowings, excluding the effect of interest rate swaps, at the balance sheet date are as follows:
As at 30 June 2024 | As at 31 December 2023 | |||
Bank borrowings | 7.0% | 6.7% | ||
Sale and leaseback liabilities (accounted for as financing transaction) | 7.3% | 7.4% |
Carrying amounts and fair values
The carrying values of the bank borrowings and finance lease liabilities approximate their fair values as they are re-priceable at one to three months intervals.
Operating lease commitments - where the Group is a lessor
The Group leases vessels to third parties under non-cancellable operating lease agreements. The Group classifies these leases as operating leases as the Group retains substantially all risks and rewards incidental to ownership of the leased assets.
The undiscounted lease payments under operating leases to be received after the reporting date are analysed as follows:
USD’000 | As at 30 June 2024 | As at 31 December 2023 | ||
Less than one year | 98,909 | 87,459 | ||
One to two years | 35,663 | 25,830 | ||
Two to five years | 13,098 | 8,960 | ||
147,670 | 122,249 |
Newbuild Commitments
The Group has equity interests in joint ventures and is obliged to provide its share of working capital for the joint ventures’ newbuild programme through either equity contributions or shareholder’s loans.
The future minimum capital contributions to be made at the reporting date but not yet recognised are as follows:
USD’000 | As at 30 June 2024 | As at 31 December 2023 | ||
Less than one year | 46,463 | 28,394 | ||
One to two years | 33,557 | 58,079 | ||
Two to five years | – | 19,360 | ||
80,020 | 105,833 |
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Note 10: Share-based payment arrangements
The Company operates equity-settled, share-based long term incentive plans (“LTIP”) in which the entity receives services from employees as consideration for equity instruments (share options) in the group; and grants restricted share units (“RSUs”) to employees in which the entity receives services from employees as consideration for equity instruments (share units) in the group.
Share option programme (equity-settled)
On 16 April 2024, the Company awarded a total of 2,032,414 share options to key management and senior employees under the LTIP 2024 share option program. These share options will vest on 16 April 2027 at an exercise price of NOK 89.68. The vesting condition of the granted options is 3 years’ service from grant date.
On 28 February 2023, the Company granted a total of 1,849,428 share options to key management and senior employees under the LTIP 2023 share option program. These share options will vest on 28 February 2026 at an exercise price of NOK 74.62. The vesting condition of the granted options is 3 years’ service from grant date.
All share options and share units are to be settled by physical delivery of shares and will become void if the employee rescinds their position before the vesting date. The fair value of services received in return for share options granted is based on fair value of share options granted, measured using the Black-Scholes model. The following inputs were used in the measurement of the fair values at respective grant dates of the share options.
Measurement of grant date fair values of share options | LTIP 2024 | LTIP 2023 | |||
Grant date | 16 April 2024 | 28 February 2023 | |||
Share price (NOK) | 75.05 | 64.46 | |||
Exercise price (NOK) | 89.68 | 74.62 | |||
Time to maturity (years) | 4.0 | 4.5 | |||
Risk free rate | 3.70% | 3.53% | |||
Volatility | 43.50% | 50.00% | |||
Dividends | – | – | |||
Annual tenure risk | – | 7.50% | |||
Share options granted | 2,032,414 | 1,849,428 | |||
LTIP 2023 | |||||
Fair value at grant date (USD) | 4,706,608 | 3,716,961 |
Volatility has been estimated as a benchmark volatility by considering the historical average share price volatility of a comparable peer group of companies.
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Note 11: Financial information
Carrying amount | Fair value | |||||||||
Fair value hedging instruments/ Mandatorily at FVTPL – others USD’000 | Financial assets at amortised cost USD’000 | FVOCI – equity instruments USD’000 | Total USD’000 | Level 1 USD’000 | Level 2 USD’000 | Level 3 USD’000 | Total USD’000 | |||
At 30 June 2024 | ||||||||||
Financial assets measured at fair value | ||||||||||
Forward freight agreements | 1,336 | – | – | 1,336 | – | 1,336 | – | 1,336 | ||
Interest rate swaps used for hedging | 49,076 | – | – | 49,076 | – | 49,076 | – | 49,076 | ||
Other investments | – | – | 23,531 | 23,531 | – | – | 23,531 | 23,531 | ||
50,412 | – | 23,531 | 73,943 | |||||||
At 30 June 2024 | ||||||||||
Financial assets not measured at fair value | ||||||||||
Restricted cash | – | 13,445 | – | 13,445 | ||||||
Loans receivable from joint ventures | – | 57,670 | – | 57,670 | ||||||
Trade and other receivables1 | – | 600,429 | – | 600,429 | ||||||
Cash at bank and on hand | – | 166,691 | – | 166,691 | ||||||
Cash retained in the commercial pools | – | 95,890 | – | 95,890 | ||||||
– | 934,125 | – | 934,125 |
Carrying amount | Fair value | ||||||||
Fair value hedging instruments USD’000 | Other financial liabilities USD’000 | Total USD’000 | Level 1 USD’000 | Level 2 USD’000 | Level 3 USD’000 | Total USD’000 | |||
At 30 June 2024 | |||||||||
Financial liabilities measured at fair value | |||||||||
Forward foreign exchange contracts | (267) | – | (267) | – | (267) | – | (267) | ||
Forward freight agreements | (2,947) | – | (2,947) | – | (2,947) | – | (2,947) | ||
(3,214) | – | (3,214) | |||||||
At 30 June 2024 | |||||||||
Financial liabilities not measured at fair value | |||||||||
Bank borrowings | – | (539,319) | (539,319) | ||||||
Sale and leaseback liabilities (accounted for as financing transaction) and other lease liabilities | – | (595,630) | (595,630) | ||||||
Trade and other payables | – | (346,656) | (346,656) | ||||||
– | (1,481,605) | (1,481,605) |
1 Excludes prepayments
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Carrying amount | Fair value | |||||||||
Fair value hedging instruments/ Mandatorily at FVTPL – others USD’000 | Financial assets at amortised cost USD’000 | FVOCI – equity instruments USD’000 | Total USD’000 | Level 1 USD’000 | Level 2 USD’000 | Level 3 USD’000 | Total USD’000 | |||
At 31 December 2023 | ||||||||||
Financial assets measured at fair value | ||||||||||
Forward foreign exchange contracts | 449 | – | – | 449 | – | 449 | – | 449 | ||
Forward freight agreements | 1,512 | – | – | 1,512 | – | 1,512 | – | 1,512 | ||
Interest rate swaps used for hedging | 45,964 | – | – | 45,964 | – | 45,964 | – | 45,964 | ||
Other investments | – | – | 23,953 | 23,953 | – | – | 23,953 | 23,953 | ||
47,925 | – | 23,953 | 71,878 | |||||||
At 31 December 2023 | ||||||||||
Financial assets not measured at fair value | ||||||||||
Restricted cash | – | 13,381 | – | 13,381 | ||||||
Loans receivable from joint ventures | – | 69,626 | – | 69,626 | ||||||
Trade and other receivables1 | – | 568,436 | – | 568,436 | ||||||
Cash at bank and on hand | – | 141,621 | – | 141,621 | ||||||
Cash retained in the commercial pools | – | 80,900 | – | 80,900 | ||||||
– | 873,964 | – | 873,964 |
Carrying amount | Fair value | ||||||||
Fair value hedging instruments USD’000 | Other financial liabilities USD’000 | Total USD’000 | Level 1 USD’000 | Level 2 USD’000 | Level 3 USD’000 | Total USD’000 | |||
At 31 December 2023 | |||||||||
Financial liabilities measured at fair value | |||||||||
Forward freight agreements | (276) | – | (276) | – | (276) | – | (276) | ||
(276) | – | (276) | |||||||
At 31 December 2023 | |||||||||
Financial liabilities not measured at fair value | |||||||||
Bank borrowings | – | (572,511) | (572,511) | ||||||
Sale and leaseback liabilities (accounted for as financing transaction) and other lease liabilities | – | (719,840) | (719,840) | ||||||
Trade and other payables | – | (385,478) | (385,478) | ||||||
– | (1,677,829) | (1,677,829) |
The Group has no Level 1 financial assets or liabilities as at 30 June 2024 and 31 December 2023.
The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date. The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows based on observable yield curves. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. These financial instruments are included in Level 2, as all significant inputs required to fair value an instrument are observable. Other techniques, such as estimated discounted cash flows, are used to determine fair value for the remaining financial instruments.
1 Excludes prepayments
31
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. The assessment of the fair value of investments in unquoted equity instruments is performed on a quarterly basis based on the latest available data that is reasonably available to the Group.
Level 3 fair values
The Group’s investment in unquoted equity instruments measured at FVOCI using Level 3 fair value measurements were valued using market approach based on the Group’s best estimate, which is determined by using information including but not limited to the pricing of recent rounds of financing of the investees and information generated from arm’s-length market transactions involving identical or comparable assets or liabilities. The estimated fair value of the investments would either increase or decrease based on the latest available data that is reasonably available to the Group at each reporting date.
The following table shows a reconciliation from the opening balances to the closing balances of the Group’s investment in unquoted equity instruments measured at FVOCI using Level 3 fair value measurements:
30 June 2024 USD’000 | 31 December 2023 USD’000 | ||
Opening balance | 23,953 | 3,825 | |
Acquisition of equity investments at FVOCI | 661 | 10,408 | |
Equity investments at FVOCI – net change in fair value (unrealized) | 1,260 | 9,720 | |
Proceeds from disposal of other investments | (2,343) | – | |
Closing balance | 23,531 | 23,953 |
In addition to the related party information disclosed elsewhere in the Interim Financial Information, the following significant transactions took place between the Group and related parties during the financial period on commercial terms agreed by the parties:
For the 3 months ended 30 June 2024 USD’000 | For the 3 months ended 30 June 2023 USD’000 | For the 6 months ended 30 June 2024 USD’000 | For the 6 months ended 30 June 2023 USD’000 | ||
Sale and purchase of services | |||||
Support service fees paid/payable to related corporations | 1,715 | 1,633 | 3,446 | 3,325 | |
Rental paid/payable to a related corporation | 220 | 219 | 440 | 437 | |
Rendering of services | |||||
Management fees received/receivable from related corporations | 159 | 176 | 344 | 322 | |
Transactions with joint venture | |||||
Management fees received/receivable from joint venture | 292 | 153 | 519 | 249 | |
Interest income receivable from joint venture | 1,326 | 1,332 | 2,235 | 2,699 |
Related parties refer to companies controlled by Sohmen family interests. On 9 May 2022, BW Group Limited ceased to be the immediate holding company of the Group but remains as the single largest shareholder, owning an equity stake of 42.94% as at 30 June 2024. Prior to May 2022, BW Group was the controlling shareholder of the Group. BW Group is wholly-owned by Sohmen family interests.
As at 30 June 2024 USD’000 | As at 31 December 2023 USD’000 | ||||
Interest in joint ventures | 74,654 | 60,172 |
32
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
a. | Vista Shipping |
• | Vista Shipping Pte. Ltd. and its subsidiaries (“Vista Shipping”) is a joint venture in which the Group has joint control and 50% ownership interest. Vista Shipping is domiciled in Singapore and structured as a separate vehicle in shipowning, with the Group having residual interest in its net assets. Accordingly, the Group has classified its interest in Vista Shipping as a joint venture. In accordance with the agreement under which Vista Shipping was established, the Group and the other investor in the joint venture have agreed to provide shareholders’ loans in proportion to their interests to finance the newbuild programme. |
• | During the financial period ended 30 June 2024, Hafnia took delivery of one LR2 vessel through its Vista Shipping joint venture. |
• | The following table summarises the financial information of Vista Shipping as included in its own consolidated financial statements. The table also reconciles the summarised financial information to the carrying amount of the Group’s interest in Vista Shipping. |
As at 30 June 2024 USD’000 | As at 31 December 2023 USD’000 | ||||
Percentage ownership interest | 50% | 50% | |||
Non-current assets | 434,530 | 397,965 | |||
Current assets | 49,103 | 54,092 | |||
Non-current liabilities | (327,654) | (336,598) | |||
Current liabilities | (38,319) | (28,564) | |||
Net assets (100%) | 117,660 | 86,895 | |||
Group’s share of net assets (50%) | 58,830 | 43,448 | |||
Revenue | 66,417 | 91,191 | |||
Other income | 1,529 | 1,963 | |||
Expenses | (37,250) | (56,914) | |||
Profit and total comprehensive income (100%) | 30,696 | 36,240 | |||
Profit and total comprehensive income (50%) | 15,348 | 18,120 | |||
Prior year share of profit/(loss) not recognised | 35 | (170) | |||
Group’s share of total comprehensive income (50%) | 15,383 | 17,950 |
b. | H&A Shipping |
• | In July 2021, the Group and Andromeda Shipholdings Ltd (“Andromeda Shipholdings”) entered into a joint venture, H&A Shipping Pte. Ltd. (“H&A Shipping”) in which the Group has joint control and 50% ownership interest. H&A Shipping is domiciled in Singapore and structured as a separate vehicle in shipowning, with the Group having residual interest in its net assets. Accordingly, the Group has classified its interest in H&A Shipping Pte. Ltd. as a joint venture. In accordance with the agreement under which H&A Shipping was established, the Group and the other investor in the joint venture have agreed to provide equity in proportion to their interests to finance the newbuild programme. |
• | The following table summarises the financial information of H&A Shipping as included in its own consolidated financial statements. The table also reconciles the summarised financial information to the carrying amount of the Group’s interest in H&A Shipping. |
33
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
As at 30 June 2024 USD’000 | As at 31 December 2023 USD’000 | ||||
Percentage ownership interest | 50% | 50% | |||
Non-current assets | 61,440 | 62,990 | |||
Current assets | 3,723 | 5,308 | |||
Non-current liabilities | (47,565) | (52,038) | |||
Current liabilities | (5,090) | (4,548) | |||
Net assets (100%) | 12,508 | 11,712 | |||
Group’s share of net assets (50%) | 6,254 | 5,856 | |||
Shareholder’s loans | 6,308 | 7,668 | |||
Alignment of accounting policies | 1,079 | 1,006 | |||
Carrying amount of interest in joint venture | 13,641 | 14,530 | |||
Revenue | 5,706 | 11,438 | |||
Other income | 487 | 1,458 | |||
Expenses | (5,398) | (10,857) | |||
Profit and total comprehensive income (100%) | 795 | 2,039 | |||
Profit and total comprehensive income (50%) | 398 | 1,019 | |||
Alignment of accounting policies | 73 | 147 | |||
Group’s share of total comprehensive income (50%) | 471 | 1,166 |
c. | Ecomar |
• | In June 2023, the Group and SOCATRA entered into a joint venture, Ecomar Shipholding S.A.S (“Ecomar”), in which the Group has joint control and 50% ownership interest. Ecomar is incorporated in France and structured as a separate vehicle in shipowning, with the Group having residual interest in its net assets. Accordingly, the Group has classified its interest in Ecomar as a joint venture. In accordance with the agreement under which Ecomar was established, the Group and the other investor in the joint venture have agreed to provide shareholders’ loans in proportion to their interests to finance the newbuild programme. |
• | The following table summarises the financial information of Ecomar as included in its own consolidated financial statements. The table also reconciles the summarised financial information to the carrying amount of the Group’s interest in Ecomar. |
As at 30 June 2024 USD’000 | As at 31 December 2023 USD’000 | ||||
Percentage ownership interest | 50% | 50% | |||
Non-current assets | 43 | 31,873 | |||
Current assets | 46,114 | – | |||
Non-current liabilities | (1,216) | (31,849) | |||
Current liabilities | (46,483) | – | |||
Net (liabilities)/assets (100%) | (1,542) | 24 | |||
Group’s share of net (liabilities)/assets (50%) | (771) | 12 | |||
Unrecognised share of losses | 771 | – | |||
Carrying amount of interest in joint venture | – | 12 | |||
Other income | 5 | 1 | |||
Expenses | (1,571) | (87) | |||
Loss and total comprehensive loss (100%) | (1,566) | (86) | |||
Loss and total comprehensive loss (50%) | (783) | (43) | |||
Unrecognised share of losses | 771 | – | |||
Group’s share of total comprehensive loss (50%) | (12) | (43) |
34
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Note 13: Joint ventures CONTINUED
d. | Complexio |
• | In March 2023, the Group and Simbolo Holdings Limited entered into a share purchase agreement where the Group purchased 50% of Class A shares (with voting rights) in Quintessential AI Limited (“Q-AI”). As a result of the transaction, the Group has joint control (with Simbolo Holdings having the remainder of Class A shares) of Q-AI; with a 25.5% ownership interest. Q-AI is incorporated in London and operates in the software development industry. Accordingly, the Group has classified its interest in Q-AI as a joint venture. |
• | The cost of investment as of 30 June 2024 was USD 2.2 million. The Company was subsequently renamed to Complexio Limited (“Complexio”). |
For the 3 months ended 30 June 2024 | Total USD’000 | |||||
Revenue (Hafnia Vessels and TC Vessels) | 42,909 | 154,113 | 261,078 | 104,996 | 563,096 | |
Revenue (External Vessels in Disponent-Owner Pools) | 29,696 | 92,117 | 123,860 | 22,391 | 268,064 | |
Voyage expenses (Hafnia Vessels and TC Vessels) | (10,216) | (35,980) | (67,360) | (32,184) | (145,740) | |
Voyage expenses (External Vessels in Disponent-Owner Pools) | (9,768) | (27,707) | (39,785) | (7,010) | (84,270) | |
Pool distributions for External Vessels in Disponent-Owner Pools | (19,928) | (64,410) | (84,075) | (15,381) | (183,794) | |
TCE Income5 | 32,693 | 118,133 | 193,718 | 72,812 | 417,356 | |
Other operating income | 659 | 2,010 | 4,448 | 1,098 | 8,215 | |
Vessel operating expenses | (3,633) | (16,228) | (33,003) | (16,199) | (69,063) | |
Technical management expenses | (530) | (2,082) | (3,623) | (1,372) | (7,607) | |
Charter hire expenses | – | (2,531) | (9,132) | – | (11,663) | |
29,189 | 99,302 | 152,408 | 56,339 | 337,238 | ||
Depreciation charge | (3,542) | (14,558) | (28,116) | (8,302) | (54,518) | |
282,720 | ||||||
(21,951) | ||||||
Profit before income tax | 260,769 |
For the 6 months ended 30 June 2024 | LR21 USD’000 | LR12 USD’000 | MR3 USD’000 | Handy4 USD’000 | Total USD’000 | |
Revenue (Hafnia Vessels and TC Vessels) | 72,410 | 318,224 | 497,655 | 196,561 | 1,084,850 | |
Revenue (External Vessels in Disponent-Owner Pools) | 56,907 | 185,079 | 237,261 | 51,918 | 531,165 | |
Voyage expenses (Hafnia Vessels and TC Vessels) | (14,207) | (81,105) | (131,491) | (61,938) | (288,741) | |
Voyage expenses (External Vessels in Disponent-Owner Pools) | (22,103) | (53,176) | (76,403) | (16,801) | (168,483) | |
Pool distributions for External Vessels in Disponent-Owner Pools | (34,804) | (131,903) | (160,858) | (35,117) | (362,682) | |
TCE Income5 | 58,203 | 237,119 | 366,164 | 134,623 | 796,109 | |
Other operating income | 1,418 | 4,034 | 6,876 | 2,343 | 14,671 | |
Vessel operating expenses | (7,957) | (33,422) | (65,846) | (31,467) | (138,692) | |
Technical management expenses | (875) | (3,494) | (6,323) | (2,634) | (13,326) | |
Charter hire expenses | – | (4,716) | (16,477) | – | (21,193) | |
Adjusted EBITDA5 | 50,789 | 199,521 | 284,394 | 102,865 | 637,569 | |
Depreciation charge | (6,924) | (29,516) | (55,286) | (16,501) | (108,227) | |
529,342 | ||||||
Unallocated6 | (47,259) | |||||
Profit before income tax | 482,083 |
1 Vessels between 85,000 DWT and 124,999 DWT in size and provides transportation of clean petroleum oil products.
2 Vessels between 55,000 DWT and 84,999 DWT in size and provides transportation of clean and dirty petroleum products.
3 Vessels between 40,000 DWT and 54,999 DWT in size and provides transportation of clean and dirty oil products, vegetable oil and easy chemicals; inclusive of IMO II vessels
4 Vessels between 25,000 DWT and 39,999 DWT in size and provides transportation of clean and dirty oil products, vegetable oil and easy chemicals; inclusive of IMO II vessels
5 See Non-IFRS Measure section in Note 17.
6 Including prior period adjustments for vessels that are not a part of the Group’s operating segments in the financial year ended 2024.
35
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Note 14: Segment information CONTINUED
For the 3 months ended 30 June 2023 | Chemical – Stainless USD’000 | Specialized USD’000 | Total USD’000 | |||||
Revenue (Hafnia Vessels and TC Vessels) | 25,338 | 138,789 | 218,756 | 93,843 | (54) | 1,527 | 478,199 | |
Revenue (External Vessels in Disponent-Owner Pools) | 14,863 | 95,848 | 72,295 | 39,737 | – | – | 222,743 | |
Voyage expenses (Hafnia Vessels and TC Vessels) | (5,177) | (35,303) | (59,502) | (28,230) | (18) | (621) | (128,851) | |
Voyage expenses (External Vessels in Disponent-Owner Pools) | (5,707) | (30,768) | (25,704) | (14,831) | – | – | (77,010) | |
Pool distributions for External Vessels in Disponent-Owner Pools | (9,156) | (65,080) | (46,591) | (24,906) | – | – | (145,733) | |
20,161 | 103,486 | 159,254 | 65,613 | (72) | 906 | 349,348 | ||
Other operating income | 347 | 1,834 | 3,371 | 1,508 | – | 1,840 | 8,900 | |
Vessel operating expenses | (4,040) | (15,596) | (30,089) | (15,831) | 63 | – | (65,493) | |
Technical management expenses | (373) | (1,538) | (2,602) | (1,272) | – | – | (5,785) | |
Charter hire expenses | – | (2,391) | (4,990) | – | – | (742) | (8,123) | |
Adjusted EBITDA5 | 16,095 | 85,795 | 124,944 | 50,018 | (9) | 2,004 | 278,847 | |
Depreciation charge | (3,426) | (14,023) | (25,779) | (8,249) | – | – | (51,477) | |
227,370 | ||||||||
Unallocated | (12,590) | |||||||
Profit before income tax | 214,780 |
For the 6 months ended 30 June 2023 | LR21 USD’000 | LR12 USD’000 | MR3 USD’000 | Handy4 USD’000 | Chemical – Stainless USD’000 | Specialized USD’000 | Total USD’000 | |
Revenue (Hafnia Vessels and TC Vessels) | 53,605 | 297,513 | 455,563 | 192,847 | (255) | 1,527 | 1,000,800 | |
Revenue (External Vessels in Disponent-Owner Pools) | 21,019 | 146,102 | 93,722 | 55,857 | – | – | 316,700 | |
Voyage expenses (Hafnia Vessels and TC Vessels) | (11,430) | (75,213) | (125,086) | (61,874) | (36) | (621) | (274,260) | |
Voyage expenses (External Vessels in Disponent-Owner Pools) | (8,570) | (54,852) | (36,148) | (20,191) | – | – | (119,761) | |
Pool distributions for External Vessels in Disponent-Owner Pools | (12,449) | (91,250) | (57,574) | (35,666) | – | – | (196,939) | |
TCE Income5 | 42,175 | 222,300 | 330,477 | 130,973 | (291) | 906 | 726,540 | |
Other operating income | 828 | 5,557 | 6,398 | 3,680 | (705) | 1,840 | 17,598 | |
Vessel operating expenses | (7,728) | (33,373) | (58,492) | (30,565) | 10 | – | (130,148) | |
Technical management expenses | (731) | (3,312) | (5,206) | (2,561) | – | – | (11,810) | |
Charter hire expenses | – | (4,765) | (9,503) | – | – | (742) | (15,010) | |
Adjusted EBITDA5 | 34,544 | 186,407 | 263,674 | 101,527 | (986) | 2,004 | 587,170 | |
Depreciation charge | (6,814) | (28,898) | (50,955) | (16,399) | – | – | (103,066) | |
484,104 | ||||||||
Unallocated | (10,766) | |||||||
Profit before income tax | 473,338 |
1 Vessels between 85,000 DWT and 124,999 DWT in size and provides transportation of clean petroleum oil products.
2 Vessels between 55,000 DWT and 84,999 DWT in size and provides transportation of clean and dirty petroleum products.
3 Vessels between 40,000 DWT and 54,999 DWT in size and provides transportation of clean and dirty oil products, vegetable oil and easy chemicals; inclusive of IMO II vessels
4 Vessels between 25,000 DWT and 39,999 DWT in size and provides transportation of clean and dirty oil products, vegetable oil and easy chemicals; inclusive of IMO II vessels
5 See Non-IFRS Measure section in Note 17.
36
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
On 11 July 2024, Hafnia refinanced its existing 106m DSF facility into the 84m DSF facility.
On 16 July 2024, Hafnia sold the LR1 vessel, Hafnia Thames, to an external party.
On 19 July 2024, Hafnia Nile was involved in a collision with another vessel which resulted in the vessel being damaged and unable to trade. Management has assessed that the damage suffered by the vessel will be covered by insurance and no provisions are necessary. The vessel is expected to be on off-hire until the end of the year. As the incident took place after the reporting period, this is a non-adjusting event for the purpose of this Interim Financial Information.
On 20 August 2024, Hafnia sold the MR vessel, Hafnia Pegasus, to an external party.
Vessel | DWT | Year Built | Type | Vessel | DWT | Year Built | Type | |||
Hafnia Bering | 39,067 | Apr-15 | Handy | Hafnia Despina | 115,000 | Jan-19 | LR2 | |||
Hafnia Magellan | 39,067 | May-15 | Handy | Hafnia Galatea | 115,000 | Mar-19 | LR2 | |||
Hafnia Malacca | 39,067 | Jul-15 | Handy | Hafnia Larissa | 115,000 | Apr-19 | LR2 | |||
Hafnia Soya | 38,700 | Nov-15 | Handy | BW Neso | 115,000 | Jul-19 | LR2 | |||
Hafnia Sunda | 39,067 | Sep-15 | Handy | Hafnia Thalassa | 115,000 | Sep-19 | LR2 | |||
Hafnia Torres | 39,067 | May-16 | Handy | Hafnia Triton | 115,000 | Oct-19 | LR2 | |||
Hafnia Kallang | 74,000 | Jan-17 | LR1 | Hafnia Languedoc1 | 115,000 | Mar-23 | LR2 | |||
Hafnia Nile | 74,000 | Aug-17 | LR1 | Hafnia Larvik1 | 109,999 | Oct-23 | LR2 | |||
Hafnia Seine | 76,580 | May-08 | LR1 | Hafnia Loire1 | 115,000 | May-23 | LR2 | |||
Hafnia Shinano | 74,998 | Oct-08 | LR1 | Hafnia Lillesand1 | 109,999 | Feb-24 | LR2 | |||
Hafnia Tagus | 74,000 | Mar-17 | LR1 | Beagle2 | 44,995 | Mar-19 | MR | |||
Hafnia Thames | 74,999 | Aug-08 | LR1 | Boxer2 | 49,852 | Jun-19 | MR | |||
Hafnia Yangtze | 74,996 | Jan-09 | LR1 | Basset2 | 49,875 | Nov-19 | MR | |||
Hafnia Yarra | 74,000 | Jul-17 | LR1 | Bulldog2 | 49,856 | Feb-20 | MR | |||
Hafnia Zambesi | 74,982 | Jan-10 | LR1 | BW Bobcat | 49,999 | Aug-14 | MR | |||
Hafnia Africa | 74,539 | May-10 | LR1 | Hafnia Cheetah | 49,999 | Feb-14 | MR | |||
Hafnia Asia | 74,539 | Jun-10 | LR1 | Hafnia Cougar | 49,999 | Jan-14 | MR | |||
Hafnia Australia | 74,539 | May-10 | LR1 | Hafnia Eagle | 49,999 | Jul-15 | MR | |||
75,000 | Jan-19 | LR1 | BW Egret | 49,999 | Nov-14 | MR | ||||
Hafnia Shanghai1 | 75,000 | Jan-19 | LR1 | BW Falcon | 49,999 | Feb-15 | MR | |||
Hafnia Guangzhou1 | 75,000 | Jul-19 | LR1 | Hafnia Hawk | 49,999 | Jun-15 | MR | |||
Hafnia Beijing1 | 75,000 | Oct-19 | LR1 | Hafnia Jaguar | 49,999 | Mar-14 | MR | |||
79,902 | Jul-19 | LR1 | BW Kestrel | 49,999 | Aug-15 | MR | ||||
Karimata2 | 79,885 | Aug-19 | LR1 | Hafnia Leopard | 49,999 | Jan-14 | MR | |||
Hafnia Shenzhen1 | 75,000 | Aug-20 | LR1 | Hafnia Lioness | 49,999 | Jan-14 | MR | |||
Hafnia Nanjing1 | 74,999 | Jan-21 | LR1 | Hafnia Lynx | 49,999 | Nov-13 | MR | |||
Kamome Victoria2 | 69,998 | May-11 | LR1 | BW Merlin | 49,999 | Sep-15 | MR | |||
Peace Victoria2 | 77,378 | Oct-19 | LR1 | Hafnia Myna | 49,999 | Oct-15 | MR | |||
Hafnia Excelsior | 74,665 | Jan-16 | LR1 | BW Osprey | 49,999 | Oct-15 | MR | |||
Hafnia Executive | 74,431 | May-16 | LR1 | Hafnia Panther | 49,999 | Jun-14 | MR | |||
Hafnia Prestige | 74,997 | Nov-16 | LR1 | Hafnia Petrel | 49,999 | Jan-16 | MR | |||
Hafnia Providence | 74,997 | Aug-16 | LR1 | Hafnia Puma | 49,999 | Nov-13 | MR | |||
Hafnia Pride | 74,997 | Jul-16 | LR1 | Hafnia Raven | 49,999 | Nov-15 | MR | |||
Hafnia Excellence | 74,613 | May-16 | LR1 | Hafnia Swift | 49,999 | Jan-16 | MR | |||
Hafnia Exceed | 74,665 | Feb-16 | LR1 | Hafnia Tiger | 49,999 | Mar-14 | MR | |||
Hafnia Expedite | 74,634 | Jan-16 | LR1 | BW Wren | 49,999 | Mar-16 | MR | |||
Hafnia Express | 74,663 | May-16 | LR1 | Hafnia Andromeda | 49,999 | May-11 | MR | |||
Hafnia Excel | 74,547 | Nov-15 | LR1 | Hafnia Ane | 49,999 | Nov-15 | MR | |||
Hafnia Precision | 74,997 | Oct-16 | LR1 | Hafnia Crux | 52,550 | Feb-12 | MR | |||
Hafnia Experience | 74,670 | Mar-16 | LR1 | Hafnia Daisy | 49,999 | Aug-16 | MR | |||
Hafnia Pioneer | 81,350 | Jun-13 | LR1 | Hafnia Henriette | 49,999 | Jun-16 | MR |
1 50% owned through the Vista Shipping Joint Venture
2 Time chartered in vessel
37
HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Note 16: Fleet list CONTINUED
Vessel | DWT | Year Built | Type | ||||||
Hafnia Kirsten | 49,999 | Jan-17 | MR | ||||||
Hafnia Lene | 49,999 | Jul-15 | MR | ||||||
Hafnia Leo | 52,340 | Nov-13 | MR | ||||||
Hafnia Libra | 52,384 | May-13 | MR | ||||||
Hafnia Lise | 49,999 | Sep-16 | MR | ||||||
Hafnia Lotte | 49,999 | Jan-17 | MR | ||||||
Hafnia Lupus | 52,550 | Apr-12 | MR | ||||||
Hafnia Mikala | 49,999 | May-17 | MR | ||||||
Hafnia Nordica | 49,994 | Mar-10 | MR | ||||||
Hafnia Pegasus | 50,326 | Oct-10 | MR | ||||||
Hafnia Phoenix | 52,340 | Jul-13 | MR | ||||||
Hafnia Taurus | 50,385 | Jun-11 | MR | ||||||
Hafnia Andrea | 49,999 | Jun-15 | MR | ||||||
Hafnia Caterina | 49,999 | Aug-15 | MR | ||||||
Orient Challenge1 | 49,972 | Jun-17 | MR | ||||||
Orient Innovation1 | 49,972 | Jul-17 | MR | ||||||
Yellow Stars2 | 49,999 | Jul-21 | MR | ||||||
Clearocean Milano1 | 50,485 | Oct-21 | MR | ||||||
Clearocean Ginkgo1 | 49,999 | Aug-21 | MR | ||||||
PS Stars2 | 49,999 | Jan-22 | MR | ||||||
Hafnia Almandine | 38,506 | Feb-15 | IMO II – Handy | ||||||
Hafnia Amber | 38,506 | Feb-15 | IMO II – Handy | ||||||
Hafnia Amethyst | 38,506 | Mar-15 | IMO II – Handy | ||||||
Hafnia Ametrine | 38,506 | Apr-15 | IMO II – Handy | ||||||
Hafnia Aventurine | 38,506 | Apr-15 | IMO II – Handy | ||||||
Hafnia Andesine | 38,506 | May-15 | IMO II – Handy | ||||||
Hafnia Aronaldo | 38,506 | Jun-15 | IMO II – Handy | ||||||
Hafnia Aquamarine | 38,506 | Jun-15 | IMO II – Handy | ||||||
Hafnia Axinite | 38,506 | Jul-15 | IMO II – Handy | ||||||
Hafnia Amessi | 38,506 | Jul-15 | IMO II – Handy | ||||||
Hafnia Azotic | 38,506 | Sep-15 | IMO II – Handy | ||||||
Hafnia Amazonite | 38,506 | May-15 | IMO II – Handy | ||||||
Hafnia Ammolite | 38,506 | Aug-15 | IMO II – Handy | ||||||
Hafnia Adamite | 38,506 | Sep-15 | IMO II – Handy | ||||||
Hafnia Aragonite | 38,506 | Oct-15 | IMO II – Handy | ||||||
Hafnia Azurite | 38,506 | Aug-15 | IMO II – Handy | ||||||
Hafnia Alabaster | 38,506 | Nov-15 | IMO II – Handy | ||||||
Hafnia Achroite | 38,506 | Jan-16 | IMO II – Handy | ||||||
Hafnia Turquoise | 49,000 | Apr-16 | IMO II – MR | ||||||
Hafnia Topaz | 49,000 | Jul-16 | IMO II – MR | ||||||
Hafnia Tourmaline | 49,000 | Oct-16 | IMO II – MR | ||||||
Hafnia Tanzanite | 49,000 | Nov-16 | IMO II – MR | ||||||
Hafnia Viridian | 49,000 | Dec-15 | IMO II – MR | ||||||
Hafnia Violette | 49,000 | Mar-16 | IMO II – MR | ||||||
Hafnia Atlantic | 49,614 | Dec-17 | IMO II – MR | ||||||
Hafnia Pacific | 49,868 | Dec-17 | IMO II – MR | ||||||
Hafnia Valentino | 49,126 | May-15 | IMO II – MR |
1 Time chartered in vessel
2 50% owned through the H&A Shipping Joint Venture
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
Throughout this Interim Financial Information Q2 and H1 2024, we provide a number of key performance indicators used by our management and often used by competitors in our industry.
Adjusted EBITDA
“Adjusted EBITDA” is a non-IFRS financial measure and as used herein represents earnings before financial income and expenses, depreciation, impairment, amortization and taxes. Adjusted EBITDA additionally includes adjustments for gain/(loss) on disposal of vessels and/or subsidiaries, share of profit and loss from equity accounted investments, interest income and interest expense, capitalised financing fees written off and other finance expenses. Adjusted EBITDA is used as a supplemental financial measure by management and external users of financial statements, such as lenders, to assess our operating performance as well as compliance with the financial covenants and restrictions contained in our financing agreements.
We believe that Adjusted EBITDA assists management and investors by increasing comparability of our performance from period to period. This increased comparability is achieved by excluding the potentially disparate effects of interest, depreciation, impairment, amortization and taxes. These are items that could be affected by various changing financing methods and capital structure which may significantly affect profit/(loss) between periods. Including Adjusted EBITDA as a measure benefits investors in selecting between investment alternatives.
Adjusted EBITDA is a non-IFRS financial measure and should not be considered as an alternative to net income or any other measure of our financial performance calculated in accordance with IFRS. Adjusted EBITDA excludes some, but not all, items that affect profit/(loss) and these measures may vary among other companies. Adjusted EBITDA as presented below may not be comparable to similarly titled measures of other companies.
Reconciliation of Non-IFRS measures
The following table sets forth a reconciliation of Adjusted EBITDA to profit/(loss) for the financial period, the most comparable IFRS financial measure for the period ended 30 June 2024 and 30 June 2023.
For the 3 months ended 30 June 2024 USD’000 | For the 3 months ended 30 June 2023 USD’000 | For the 6 months ended 30 June 2024 USD’000 | For the 6 months ended 30 June 2023 USD’000 | ||
Profit for the financial period | 259,197 | 213,267 | 478,768 | 469,902 | |
Income tax expense | 1,572 | 1,513 | 3,315 | 3,436 | |
Depreciation charge of property, plant and equipment | 54,595 | 51,545 | 108,388 | 103,206 | |
Amortisation charge of intangible assets | 251 | 323 | 587 | 655 | |
Loss/(gain) on disposal of assets | 100 | (19,828) | 100 | (56,515) | |
Share of profit of equity-accounted investees, net of tax | (8,553) | (5,140) | (15,842) | (10,962) | |
Interest income | (4,479) | (5,515) | (7,284) | (10,424) | |
Interest expense | 13,215 | 21,509 | 29,042 | 50,709 | |
Capitalised financing fees written off | – | – | 1,663 | – | |
Other finance expense | 1,185 | 3,884 | 5,398 | 7,564 | |
Adjusted EBITDA | 317,083 | 261,558 | 604,135 | 557,571 |
Time charter equivalent (or “TCE”)
TCE (or TCE income) is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company’s performance despite changes in the mix of charter types (i.e., voyage charters and time charters) under which the vessels may be employed between the periods. We define TCE income as income from time charters and voyage charters (including income from Pools, as described above) for our Hafnia Vessels and TC Vessels less voyage expenses (including fuel oil, port costs, brokers’ commissions and other voyage expenses).
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HAFNIA INTERIM-FINANCIAL-INFORMATION-Q2-AND-H1-2024 | ![]() |
We present TCE income per operating day1, a non-IFRS measure, as we believe it provides additional meaningful information in conjunction with revenues, the most directly comparable IFRS measure, because it assists management in making decisions regarding the deployment and use of our Hafnia Vessels and TC Vessels and in evaluating their financial performance. Our calculation of TCE income may not be comparable to that reported by other shipping companies.
Reconciliation of Non-IFRS measures
The following table reconciles our revenue (Hafnia Vessels and TC Vessels), the most directly comparable IFRS financial measure, to TCE income per operating day.
(in USD’000 except operating days and TCE income per operating day) | For the 3 months ended 30 June 2024 | For the 3 months ended 30 June 2023 | For the 6 months ended 30 June 2024 | For the 6 months ended 30 June 2023 | |
Revenue (Hafnia Vessels and TC Vessels) | 563,098 | 478,199 | 1,084,890 | 1,000,800 | |
Revenue (External Vessels in Disponent-Owner Pools) | 268,064 | 222,743 | 531,165 | 316,700 | |
Less: Voyage expenses (Hafnia Vessels and TC Vessels) | (145,739) | (128,851) | (288,729) | (274,260) | |
Less: Voyage expenses (External Vessels in Disponent-Owner Pools) | (84,270) | (77,010) | (168,483) | (119,761) | |
Less: Pool distributions (External Vessels in Disponent-Owner Pools) | (183,794) | (145,733) | (362,682) | (196,939) | |
TCE income | 417,359 | 349,348 | 796,161 | 726,540 | |
Operating days | 10,635 | 10,444 | 21,091 | 20,829 | |
TCE income per operating day | 39,244 | 33,449 | 37,750 | 34,882 |
Revenue, voyage expenses and pool distributions in relation to External Vessels in Disponent-Owner Pools nets to zero, and therefore the calculation of TCE income is unaffected by these items:
(in USD’000 except operating days and TCE income per operating day) | For the 3 months ended 30 June 2024 | For the 3 months ended 30 June 2023 | For the 6 months ended 30 June 2024 | For the 6 months ended 30 June 2023 | |
Revenue (Hafnia Vessels and TC Vessels) | 563,098 | 478,199 | 1,084,890 | 1,000,800 | |
Less: Voyage expenses (Hafnia Vessels and TC Vessels) | (145,739) | (128,851) | (288,729) | (274,260) | |
TCE income | 417,359 | 349,348 | 796,161 | 726,540 | |
Operating days | 10,635 | 10,444 | 21,091 | 20,829 | |
TCE income per operating day | 39,244 | 33,449 | 37,750 | 34,882 |
‘TCE income’ as used by management is therefore only illustrative of the performance of the Hafnia Vessels and the TC Vessels; not the External Vessels in our Pools.
For the avoidance of doubt, in all instances where we use the term “TCE income” and it is not succeeded by “(voyage charter)”, we are referring to TCE income from revenue and voyage expenses related to both voyage charter and time charter.
1 Operating days are defined as the total number of days (including waiting time) in a period during which each vessel is owned, partly owned, operated under a bareboat arrangement (including sale and lease-back) or time chartered-in, net of technical off-hire days. Total operating days stated in the quarterly financial information include operating days for TC Vessels.
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