DHT - Earnings call transcript Q2 2024

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Operator

Good day, and thank you for standing by. Welcome to the Q2 2024 DHT Holdings, Inc. Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Laila Halvorsen, CFO. ahead. go Please

Laila Halvorsen

Moxnes morning you Good Earnings afternoon, Welcome, CEO, everyone. I'm Thank joining and DHT thank Svein and President for by XXXX Holdings' and joined you. DHT's good Harfjeld. Second Call. Quarter

As the before your open highlights and we can deck will be usual, link our up to website, go dhtankers.com. we The financials some through questions. slide for found on

call to will get with available of today's make like the started would replay XX. following we website, Before this our I conference be on August dhtankers.com A remarks. call, until

available our our EDGAR addition, earnings to In press an release as and SEC our will be the X-K. on on Form exhibit website system

statements you future Actual results As in periodic SEC our conference the matters We we for these a forward-looking report. are discuss in risks statements. more events our on our financial urge including materially differ information will call, system, EDGAR this current and expectations based our to in as are website on These detailed face. risk about regarding forward-looking from reminder, the forward-looking expectations these read we may factors reports that on in available nature. on reflected that reports the

net presentation the based on and market maintain represented by start was financial XX.X% was significant end, million debt will and leverage $XX.X some strong low liquidity. values we balance usual, the financial highlights. We leverage with per very As a sheet, At ships, vessel. quarter for

of available our million cash million in total second under The $XX quarter facilities. credit and with $XXX million of liquidity consisting ended revolving $XXX

P&L. the to over Now

day. quarter and came of earnings day. achieved the purchases basis consumables. G&A $XX.X million. in quarter. of $XX.X million, with for TCE included and per one-offs addition per We equal in quarter in of market average to was time Vessel to for $XX vessels for the million. which day, quarter are charters We $XXX.X revenues achieved the the vessels the income achieved expenses and results for of on spot the operating the $XX,XXX at $XX,XXX share. The -- robust on $X.XX $X.X They were million, per some Net timing pleased TCE $XX,XXX achieved was EBITDA million per spirits the with made

flow dividend stable, was half $XX,XXX our interest ex-dividend consecutive be the quarter to The will time August for repayment equal vessels with over payable $X.XX shareholders at $X.XX dividend we the day, as XXXX $XX.X the the newbuildings policy, and per a will to on and then and our million $XX.X in marks in first ordinary the to from first record XXXX, the policy. EBITDA. defined flow XX. debt second in and $XX.X X spot per combined capital a $XX amounting cash share. And in facility fund cash quarter together to CapEx. We came we flow. allocation. $XX,XXX came line installments the and was of million $X.X This dividend, will with discretionary the shares XX is quarterly ING while for XX. of share dividend, XXXX our quarterly while at used net cash. half as in $XX for drew with Cash per cash income started revolving allocation ended allocated million $XX For changes $XX equivalent first working generated per maintenance amounted with equal of has achieved through million, trade on day. Net to highlights. which Ordinary XXX% average million predictable the all pay million paid earnings we quarter charter was $X.X shareholders of and in for million, to of $XX million to related XXth Further, the of to cash million We DHT cash the the And million, capital credit August to and was cash to income. partly cash. Switching installments capital in August

side per we P&L P&L discretionary breakeven on cash for while $XX,XXX On to per of $XX,XXX in flow present year per per the the day the full resulting for the cash left update rates breakeven day, to estimated slide, after is ship for cash in an estimated $X,XXX and day XXXX. dividends. fleet, estimated breakeven is

the this P&L the about breakeven, assuming year. cash discretionary earn for vessels So in flow means $XX million

we updated the slide, share. And of of we call turn per the Svein. shareholders a the policy second in dividend have cash On to 'XX. returned with right amounts to the $X.XX This will dividend the I illustrate the that, total quarterly to we over side of since half

Svein Moxnes Harfjeld

Thank you, Laila.

company. for with updated Here quarter the outlook third for the the

for charter per for covered $XX,XXX. the profit-sharing that rate have Europe, $XX,XXX at that the charter XXX quarter DHT We day forecast at the XXXX, time This the includes have features. of time only end X time days for the base commenced third The built assumes charter contracts rate at June.

this have is spot the We from a that down number the have that our average days number. The which the hence, in a the spot for spot from you be quarter, this been income of booked $XX,XXX. assist breakeven [ there rate net quarter current should at is fleets ]. market for $XX,XXX, is average XX% to spot contribution X,XXX expect in The level, of will risk below estimated an this quarter P&L come estimating to

newbuilding program. present for we Here you with update an our

in the in results is April, schedules in February, increase schedule all We July for now have achieved significant 'XX. delivery for in revenue a and days the the we year. days of May improvements in This at X XXX in The contracts, to be to the delivery schedules ships. entering meaningful of expect compared the to XXX When year. the days revenue the into time for increase now range

been have under all construction ships allocated the note, names. will you As

shipyards. and expired. The options such our ships not at As advanced earnings indicated call, declared made was as for other schedule projects have been during as certain the the previous were possible have types revised for ship additional

that very spot this our period. with and is resulted being yard in us outcome, pleased this with weak market seasonal We are a currently priority. The in afforded relationship

As waiting in maintenance and game for are research analysts for now many are complete a to refinery we reports and to suggesting, runs increase.

past On X.X March the seaborne day. million and to million will transportation about you see year. XX.X crude this barrels X to day, about barrels left, down hit in per In XX.X that months, graph day the i.e., million per has per oil come some February barrels down this the of

inventories development drive largely in understand as April, This inventory to builds the June the reduced culprit illustration. and this to this July draw with in would prior for the and resulted in China in As you well we will started behind demand see key in particular. the graph transportation. We slide in being on believe refiners right, reversed the

can inventories. inventories can you that to forward the We gasoline softened see demand attractive crude feedstock the during and have improve diesel continued of in during refining supply that distances quarter. an would play will second for refiners rebuild left, On could the that In think the inventories. In rapidly with out right, growth, and built assume suggests opportunity that oil oil services refining longer these to limited demand the and offer our curve to same note markets The fundamentals aging and generate this and prospects it's combination fleet. general, crude a it oil reduce margins new of margins and you graph on with logical transportation offer increased will that our ships period.

we Our breakeven and strong strategic disciplined We levels, with are solid you. all robust up in, safe the the relations, by dividend on and balance sheet, pillars solid match markets reliable a to we believe structured remain customer operate to over for that, execution. policy. And services, operator, offering with liquidity, shareholder-friendly defined supported focusing well

Operator

line the first Instructions] question Evercore Chappell from ISI. [Operator Our of John comes from

Jonathan Chappell

one with then going of newbuildings, bit and payments year next delivery now plan like delivery? new Any on And debt X? payment the what's schedule the cadence be the to more year? for Or housekeeping and this at also, funded? look accelerated you is all on this between the A cash down for schedule drawing do the first a

Laila Halvorsen

Yes.

think expected press payments. our under I future included X, we've in table a Note with release, So

there next and rest So projects, decided payments we and are we we pleased of yet. the $XX.X that that. We've is have, months, within see then million expect XX very different suggestions financing you with that into the after nothing but looked

we've So we will get with to that you back once finalized.

Jonathan Chappell

then... And Okay.

Svein Moxnes Harfjeld

cash time of on for on hence, flow the time when is, If we I -- equity that that. we'll -- RCFs to timing generate differences the then And sort ships. cash use component then we is that, course, there and of from Jon, add these some so on and draw just and flow back that of may forth generate

quarter. this why So that's past this happened during

Jonathan Chappell

Have time charters? now any you the be point on with within Or next delivery? at in would months interest upon that spot do you implemented just those had assume market this delivery XX the

Svein Moxnes Harfjeld

some provides There of for that negotiations. interest, say it's is the but level sort I not at initial would

can intention have in this. we seeing So and interest develop we if

time, pursue I it bit next of decide think that. a year will it's take and if to we event probably a

interest. in ambition have ships have some is income to interesting couple company general. opportunities clients these for long-term in very for we X and a the it our build offer -- So more that will fixed And shown or particular

Jonathan Chappell

it's of several it quarter then function makes seen you market as to think cyclical seasonality time the third you and And Okay. it's time end any there. the just biggest beyond sense. refinery the at is a shutdowns years, crude, of Maybe it? being seasonality? Have I that concerns potential more long-haul have maybe some and a deliveries is there's some this year? seen China this truly weakness though, finally, bit weakening about China some weakest. signs There's Or component for

Svein Moxnes Harfjeld

development trucking starting has a as LNG heavy to been or Asia there's in transportation a demand LNG some in growth general. fuel. general in We've of seen think implement that the heavy to contributor And bit I meaningful in both. is

watch. So this something is to

over the the oil based. But guess, more see right in there developing China China of this to on meaningful output, petchem petchem next, is growth say, to the I capacity On the will consuming which industry. And on which crude months. XX part I that coming refining we now something not in of is is the to new a upwards has is This industry, would now. reflection focus XX around positive want in predominant of they side, is, happening policy XX%

where the components the will So the there the come than the in used like. guess I being when for, positive -- earlier negative you going And is come or market. what's components the change have oil some is is into if oil

the a this seasonality amplified bit probably summer. that's So

Operator

from Securities. question Clarksons Morkedal the next from Frode Our comes line of

Frode Morkedal

the to earnings due newbuild that impact Or the them pay view fact Regarding is not the is XXX% decision to to in themselves? of newbuild ability it on options, the dividends? a could exercise the prices it

Svein Moxnes Harfjeld

had be balance declared and those structure also we course, would desire in Well, do of increase And considerably. of if that. meaningful a CapEx, change it we to no our that have the options, would sheet

do caveat or all ships happened had not was some we charters, that that, materialize. say ships, plan had earlier X something did some interest X, long-term or we through particular core for financing that if with that's the if longer, along considered develop have for So all we have that develop to the to could X X, years might and a but X early X

that. do it we're X with happy felt the we prudent So ships, to and very

that's a yes, short guess. So I story,

Frode Morkedal

My there's you've cleaning up is sense. activity? CPP talk market. something is the magnitude also considered? What's next cargoes. VLCC about Yes, the And do that about makes that some to guess question I been of the

Svein Moxnes Harfjeld

that with handful. done to It's dock. mostly ship that Suezmaxes, think some about should VLCC think that a then XX you a been it relatively going cargoes, There's is around coincide have have that. we we maybe modern dry Ideally,

on of take will things that and I you when some history it the up dock like have of a also hundred happens, cost, dollars work. days, and thousand that XX, dry and conventional It would that cargo the beyond ship quite clean a say, ship sort And prior depending extra ship's sort probably few will that. the few

lower So cost the sort and was now pricing ships. -- of on an products arbitrage there as as the opportunity of with well

at were So We but territory not for have not it's unknown point the that done this an opportunity, this of have ships in this we for suited past. DHT. business any sort did

it. about guess we So and maybe ships, X probably that's X,

Operator

Our next question comes from Omar the from Nokta of line Jefferies.

Omar Nokta

really follow and quickly Just wanted question carrying to on clean from the cargoes. the Frode the last up VLCCs potential the about

be a just and to docks. dry done basically do then dock, going can would they -- into or You that cargo do mentioned before able X that series of the it's to Is vessels dry typically cargoes? go this that they're

Svein Moxnes Harfjeld

so clean connection you typically a load to are up. dry done of And products, gone going cargoes the that these docks the and with quite the Atlantic them when in had It's Basin Africa. then lot you refining to

for You unload. to tend the storing to a be while before cargo are laying able or you

done that's say, rates But is Atlantic tend discharge it a freshly West not from you to So after after you not the of then say, to balance of sort course, the the some to ships and second extent assessment a the that, and I market, at back of are contamination cargoes some cargo. so and But for whatnot. Africa. with you and risk Gulf you guess, try cargo to a into the detailed you to is repositioning growth decide But the really to painted general you can vessel, of the trade this. because and counterparty U.S. unless Basin positive risk do Basin, could charter dock normally decolorization dry the transfer to get view some that premium in some or things there's nuances Brazil, for that that, on loaded to X of compensates Atlantic like have in the and that. Then the what

Omar Nokta

chart And wanted continue -- you comes fact think wanted shows bigger it this non-OPEC guess maybe discussing of in we I market? the ask And have ask, of the from production that If it we're like the to type I of to demand, Okay. to where necessarily they're guess at then and constantly its to it. production that's Got to so because picture, pickup. year OPEC have VLCCs not growth. I cut. but much and production levels. it's will the you is do maybe how aspect seasonality and needing were X where growing, the dynamic down, case, perhaps just revisit we you fare you next, And say, about in earlier situation think OPEC to you've best looking a we're pattern the think XX the type Atlantic were in here then of every you this to having constantly maybe feels a got but that's to how this VLCCs the market? over is do flat OPEC that flat months fare

Svein Moxnes Harfjeld

that be positive. a think would I

on is So the a truly really Asia Atlantic barrels to it's compete business. out impossible VLCC Suezmax And to for that. in freight charts

would I say So that's a positive.

point to now barrels if also that growth price necessarily there think some sort is can barrels come of demand market the evidence market oil I to so the sinkhole. at the true decides to the without OPEC rocking of because release to those is

Saudi them. than precious I objective OPEC think to or particular, is of price thought I So more managing always that and in that clear anything

Omar Nokta

not almost looks Aframaxes of up, the Okay. loading a, but cargoes of will any Obviously, is Has been are then needle Yes. visible run it's are looks they're the VLCCs maybe like consistently standard number like port, something that has at somewhat it reverse on of onto region. And these VLCC The that final a at directed? just ramping of been because necessarily Afras perhaps is TMX good is rate, there out are how a summer? loading move And that the just perhaps one. becoming Vancouver lightering and settling not but the thing? a the also being now

Svein Moxnes Harfjeld

India. that sending And also China. will freight area onto those reverse cargo sort dock because There's And then California also Aframaxes due the have for to these over one loaded Vancouver cost is the Aframax go cargoes of a predominantly been There lightering meaningfully of cheaper heading Yes. I than further is South, or even where been from to of think, South. been, those number an then be restrictions. ships fully not there's directly China to Afras already to the

think trade else is new on. on this a that is evolve So that top of will going we what for

Operator

further this no at audio are time. questions There

to hand Harfjeld for Moxnes the back Svein will call remarks. field any So closing I

Svein Moxnes Harfjeld

DHT, good ahead. Thank you Have to for all a tuned to and wish we one. a in and day staying interested you all good

Operator

This Thank conference concludes participating. today's for call. you

disconnect. please now may by. stand Speakers, You

DHT (DHT) 13 Aug 242024 Q2 Earnings call transcript