DHT Holdings, Inc. Q3 FY2024 earnings call

• Balance sheet in excellent health with low leverage and significant liquidity; financial leverage at 17.6% at quarter end, total liquidity $264 million.
• Third quarter P&L: TCE revenues $92.6M, EBITDA $70.4M, net income $35.2M. First nine months net income $126.7M.
• Capital allocation: Paid $0.22 per share quarterly cash dividend, 59th consecutive quarterly dividend. Update on 2025 P&L break-even estimated at $26,500 per day, cash break-even at $20,000 per day.
• Fleet overview: Investment in fleet over 10 years, including new buildings, second hand acquisitions, and exhaust gas cleaning system program. Leverage level and accumulated dividends over 10 years discussed.
• Market commentary: Discussed seasonal upturn expectations, Chinese economic growth, OPEC+ strategy, and inventory levels in China.

DHT Holdings reported third quarter 2024 results with TCE revenues of $92.6 million, EBITDA of $70.4 million, and net income of $35.2 million ($0.22 per share). Vessel operating expenses for the quarter were $19 million and G&A was $4.2 million. For the first nine months of 2024, net income was $126.7 million ($0.78 per share). The balance sheet was in excellent health with low leverage and significant liquidity, ending the quarter with total liquidity of $264 million (including $74 million cash and $190 million available under revolving credit facilities). Cash flow for Q3 2024 was stable, starting with $73 million cash, generating $70 million EBITDA, and allocating $43.6 million to shareholders via cash dividend.

• 2025 P&L break-even estimated at $26,500 per day for the fleet, cash break-even at $20,000 per day with projected $6,500 per day per ship in discretionary cash flow for dividend.
• Fourth quarter bookings: Expect 596 time charter days at $40,000 per day, 1,610 spot days with 64% booked at $41,000 per day, spot P&L breakeven for quarter estimated at $21,500 per day.

• Market volatility affecting freight rates. Geopolitical factors like changes in Iranian sanctions and impact on tanker market. Uncertainty in inventory levels and market structure changes (e.g., contango vs backwardation) affecting tanker market dynamics.

Q: What's the physical sale and purchase market like, especially for secondhand values?

A: Very limited activity; last modern ship transaction was Marinakis selling to Bahri around $1B, older ships have limited transactions with some sideways movement. Time charter rates attractive.

Q: Impact of inventory buildup and market structure changes (contango vs backwardation) on tanker market?

A: Inventories in China not very high; longer inventory levels last, stronger recovery likely. OPEX game and market response to demand changes important.