BW LPG Ltd. Q4 FY2024 earnings call

• Ship asset side: Closed Avance Gas transaction with 12 VLGCs delivered to BW LPG; added BW Kizoku and exercised purchase option for BW Yushi; concluded sale of BW Cedar with $65 million proceeds and $32 million net book gain. • Charting activities: 31% of fleet exposure covered by time charters at $44,800 per day and 2% by FFA hedges at $50,600 per day for 2025. • Market outlook: VLGC market fundamentals positive despite seasonal winter trough; U.S. terminal expansions expected to push exports; Asia demand for LPG growing; Chinese petrochemical industry increasing propane use. • Financial highlights: Net profit after tax $40 million in Q4; dividend of $0.42 per share declared, with 75% from shipping profits and top-up from product services; net leverage ratio 33% in Q4; operating cash breakeven for own fleet $19,800, whole fleet $22,200; all-in cash breakeven $25,600; liquidity $603 million post-advanced gas delivery.

For shipping, the TC income per available day ended at $37,900, which is somewhat lower than the previous quarter but above the guiding of $36,000 per day. For product services, the business achieved a gross profit of $50 million, including a realized profit of $59 million, and closed the quarter with a net profit of $3.4 million. The product services realized results are emphasized as a guidance on actual trading performance, with unrealized positions not necessarily indicating loss when realized.

• Anticipate U.S. VLGC exports to reach mid-60 million tons per year by end 2026, a 12% increase from 2024. • Terminal expansion projects in U.S., Canada, and Middle East expected to increase LPG export capacity by ~45% by 2028. • No immediate plans to further expand the fleet as current fleet is satisfactory.

• Geopolitical and regulatory developments, including potential tariffs and impact on trade. • Sensitivity of Panama Canal slots to competition from other vessels. • Impact of Chinese-built vessels on the fleet if U.S. imposes charges on such vessels. • Dry dock program in 2025 and increased interest cost affecting cash breakeven.

Q: Watching the financing process during new ship addition and paying out dividends in excess of earnings, explain strategy.

A: Shares issued in Avance Gas transaction were accretive; dividend is 75% from shipping profits topped up by product services, temporary.

Q: Potential tariffs on U.S.-China trade and impact on LPG trade.

A: Monitor developments; can employ vessels outside U.S. market if necessary.

Q: Share buyback plans.

A: Consider reactivating share buyback program when right time.

Q: Strategy to reduce debt ratio and impact on dividends.

A: Cash flow from operations will gradually pay down debt and pay dividends; leverage ratio healthy at ~30%.

Q: Asset price softening due to vessel supply and fleet expansion plans.

A: No signs of asset price softening; no plans to expand fleet currently.

Q: Impact of charges on Chinese-built ships.

A: Evaluate and take measures if imposed; commercial platform provides flexibility.

Q: Upcoming CapEx in Q1 and FY '25.

A: Primarily from dry docking program, ~$4,000 per day on average in 2025.

Q: Dividend payment date.

A: Varies by market; Oslo Stock Exchange ~24th March, NYSE ~19th March.

Q: Joint venture in India for LPG distribution.

A: Progressing, expect more detail next quarter; terminal construction in final stages.