CBL International Limited

and welcome to CEL International Limited's annual results presentation for the year ended December 31st, 2024. Today's meeting will be conducted in English with simultaneous translation into Mandarin. Before we begin, I'd like to remind you that today's presentation will include forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from your expectation. Thank you for joining us today. I'm Venus Zhao, Investor Relations and Public Relations Director of CBL International Limited. Presenting alongside me are Dr. Thich Linh Trang, Chairman and Chief Executive Officer, and Mr. Nicholas Fung, Assistant Chief Financial Officer. We are excited to share our performance and achievements in fiscal year 2024 and provide an overview for fiscal year 2025. Let's begin with today's agenda. Our presentation will cover the following. First, company information. Second, market trends and geopolitical impact. Third, financial review. Fourth, operational review. Fifth, strategic initiatives and market outlook. Sixth, Q&A. Let me start with a brief introduction to CBL International. CPL International Limited, NASDAQ ticker BANL, is the listing vehicle of Banli Group, a reputable marine fuel logistics company based in the Asian Pacific region that was established in 2015. Our key services include bunkering services across strategic global ports, supplying both fossil fuels and sustainable fuels, and serving container miners, bulk carriers, and tankers. We are a global marine fuel logistics provider operating under an asset-light business model. We are recognized as professional and trustworthy by our business counterparties. delivering flexible and integrated vessel refueling solutions. Our competitive advantages include, first, global ports network. We operate in over 60 ports across Asian Pacific, Europe, Africa, and Central America. Second, supplier relationships. We maintain strong relationships, enable us to offer competitive fuel pricing, favorable credit terms, and operational reliability. Third, customer relationships. With our extensive service, we can provide one-stop refueling solutions for customers, ensuring seamless service and operational efficiency. Fourth, growth strategy. We are focused on expanding our service network, increasing sales volume, and integrated sustainable fuel solutions to meet evolving market needs. This short corporate video will give you a comprehensive overview of our company's operation. Please enjoy.

Starting 2015, we served mainly the world's top 20 international container liner operators. We are providing customers with options to get their vessels refueled in more than 60 refueling ports worldwide. We are Bonley. Our services cover the majority of the ports in the fast-growing market of Asia-Pacific, which includes our customers' sailing routes along the Euro-Asia route, Inter-Asia route, and Trans-Pacific route. We have established an extensive supply network to provide our customers with more options and flexibility in fulfilling their vessel refueling requirements. Our establishments include Kuala Lumpur, Hong Kong, Shenzhen, Seoul, Labuan, Singapore, London, and Dublin that forms a network which currently covers more than 60 ports worldwide. Customers can customize the best quality bunkering services and select the most convenient port. Our business is built with a customer-oriented culture and focuses on providing marine fuel. with our professional and reliable bunkering services, at competitive price, as well as helping customers whenever they are dealing with contingencies. In 2023, we marked the listing on NASDAQ. In support of international maritime organizations' decarbonization initiatives, we have obtained both the ISCC EU and ISCC Plus certifications. This enables us to support the industry's collective efforts towards the net-zero journey. Moving forward, we intend to allocate more resources to further expand our supply network targeting at the continual market share enhancement. We have positioned ourselves as one of the pioneers in providing stable biofuel supply at major ports during this transition period. Simultaneously, we will continue to explore various green and sustainable marine fuel solutions for our customers. We endeavor to ensure that our customers can continue their voyages safely and with confidence We are Bondly.

I hope this video provides insights into who we are and the exciting opportunities that lie ahead. We maintain long-term strategic partnerships with global industry leaders and are recognized in the industry as a professional and trustworthy provider of flexible and integrated vessel refueling services. Through collaboration with reputable local partners, we consistently deliver high-quality services to our clients worldwide. This ensures assets are efficient, reliable, and competitively priced bunker fuel solutions, meeting the diverse needs of the global marine time industry. Now, we move on to the market trends and geopolitical impact. Let's continue. Seaborn trade and container volume has demonstrated steady growth, as shown in this review of 2024. According to UNCTAD and Cluston's research, total seaborn trade grew by 2.5% in 2024, while containerized trade grew by 2.9%. Both are forecasted to maintain that moderate annual growth rates through 2029. Container volume for all trades increased by 5% in 2024, with headquarter and regional trades achieving growth of 6%. These numbers reflect the consistent recovery and expansion of global trade. CBL's bunkering operational network aligns strongly with this trend, with a presence in 13 out of top 15 global container ports, including all of the top 10 ports, such as Shanghai, Singapore, and Ningbo Zhou Shan. On the customer front, CBL serves nine out of top 12 global container liners, which represents a combined around 60% market share in global container liners. Let's move on to this slide, which highlights geopolitical resilience of CBL. Global maritime trade faced significant disruptions in 2024 due to geopolitical tensions. The Red Sea Crisis, which began in October 2023, severely impacted key maritime routes, such as the Suez Canal and Bad Elm and Dead Strait. This led to rerouting of vessels, long transit times, and increased operational costs. For example, the voyage from Rotterdam to Shanghai increased from 25.5 days to 34 days. This disruption also triggered a surge in freight rates and heightened bunkering demand, particularly in regions like Asian Pacific, Mauritius, and Cape Town. Middle East tensions further accelerated the situation, increasing insurance premiums and raising operational costs for shipping companies. The ongoing Ukraine conflicts continue to destabilize the energy markets, resulting in bunker fuel price volatility. While prices spiked during the initial phase of the crisis, they began to stabilize later in the year as the market adjusted to new demand patterns. Despite a projected slowdown in global GDP growth to 2.6% in 2024, maritime trade demonstrated resilience, with total volumes increasing by 2%. Containerized trade outperformed the broader market, expanding by 3.5% as supply chains continue to normalize post-pandemic. Despite these challenges, the CBL team responded swiftly and strategically. We adjusted our service network by providing service in new ports, including Mauritius, India, and Panama, key locations along the rerouted shipping lanes. We implemented strategic pricing measures to manage cost volatility and maintain competitive pricing for our customers. Finally, our networks adapted to the evolving shipping patterns, ensuring that our clients' fuel needs are met efficiently despite the disruptions. Let's move to our financial highlights. Here are the fiscal year 2024 financial highlights showcasing CBL's short performance. Total sales volume grew by 38.1%, while revenue increased by 35.9% to $592.5 million, driven by higher demand and operational expansion. Cash balance rose by 8.3% to $8 million, and operational cash flow surged by 80.6%, reflecting improved efficiency and cash management. Our current ratio of 1.47 demonstrated healthy liquidity. while capital days at minus 2.55, highlights excellent cash cycle management. Delving deeper into our financial results. Revenue, CBL's total revenue rose by 35.9%, reaching $593 million, up from $436 million in 2023. This growth was primarily driven by successful expansion of our supply network and enlarged customer base and the support of sufficient financial resources. Gross profit. Gross profit declined by 25.5% from 7.21 million US dollar to 5.37 million US dollar. To support market expansion and new market entry, the company implemented strategic pricing adjustments. However, the decline in gross profit per ton, driven by reduced premium pricing, was only partly mitigated by higher sales volume. Operating expenses Operating expenses increased significantly by 56.8%, from $5.55 million to $8.7 million. This rise was primarily attributable to expenses for business expansion and biofuel operation, and additional expenses relating to enhanced ESG. Net income. Net income fell from $1.13 million in 2023 to a loss of $3.87 million in 2024. This decline was mainly driven by the reduction in gross profit due to the sales volume expansion strategy, increased expenses for business expansion, biofuel operation, and ESG expenses. a rise in interest expenses. In fiscal year 2024, CBL's revenue distribution and growth by geographic location highlights key market trends. China accounted for 56.3% of total revenue, followed by Hong Kong at 30.3%, and Malaysia at 9.8%, with smaller contributions from Singapore, South Korea, and others. Compared to fiscal year 2023, the largest revenue growth was seen in others include Europe, Japan, Vietnam, and Thailand, 291%. South Korea at 187%, followed by 102% increase in Singapore and 38% growth in China. This growth reflects CBL's strategic focus on expanding operations in emerging markets and strengthening its presence in high-growth regions. CBL's high liquidity and financial flexibility have enabled sustainable growth in 2024. Working capital management. High liquidity strengthened the cash cycle and support business expansions. Strong cash position. Cash accounts for 12% of current assets, ensure immediate liquidity. Bank facility. Sufficient facilities are in place to fund future development projects. Debt and leverage. Focus on maintaining low debt levels provides flexibility for future growth. Operating cash flow. Significant improvements support reinvestments in network expansion and technology. Just-in-time inventory management. Optimized cash flow minimizes storage risk and enhances efficiency. Minimal fixed assets. Maintain a lean asset base ensures operational agility. CBO's high liquidity and the financial flexibility have enabled sustainable growth Let's move on to the operational review. In fiscal year 2024, CBL significantly expanded its global service network, achieving over 70% growth in port coverage from 36 ports since IPO in 2023 to more than 60 ports across 14 countries in four continents. Asia, China expanded biofuel supply to Guangzhou in March 2024 and Shenzhen in April 2024. Malaysia launched inaugural biofuel supply in Portland in June 2024. India added Mondra Port in Gujarat in July 2024. South Korea, revenue surged by 187% year on year. Singapore, revenue grew by 102% year on year. Europe, strong growth in the Amsterdam, Rotterdam, Antwerp, ARA region. Open a new office in Ireland in late 2023, enhancing sourcing capabilities. Africa, enter Mauritius, enabling key bunkering services in Africa. Central America, expanded coverage in Panama to strengthen the network. In fiscal year 2024, CBL achieved a remarkable growth in sales volume, which surged by 38.1% compared to fiscal year 2023. This was driven by network expansion, new customer acquisition, and a strategic shift toward non-container liner segments. Non-container liner customers increased to 45% of customer base versus 32% in 2023. while container liner customers declined to 55% versus 68% in 2023. CBL served nine of the world's top 12 container shipping lines, representing about 60% of the global container fleet. Expanded market presence in China, Hong Kong, Malaysia, Singapore, South Korea, and new ports in Europe, Africa, India, and Central America. Diversified operations into bulk and tank businesses and reduced dependence on the top five customers. While average selling price per metric ton decreased by 1.6% in 2024, the strong sales volume growth underscores CBL's ability to adapt and thrive in changing market conditions. Over the year, CBL achieved significant progress in its biofuel supplying initiatives with the launch of B24 Biofuel. reducing greenhouse gas emissions by 20% compared to traditional fuels. This expansion included new cells in Malaysia, Hong Kong, and various ports in China, as well as the first B24 biofuel supply in Singapore in March 2025. CBL also achieved ISCC EU and ISCC Plus certifications, ensure compliance with sustainable green fuel standards. Biofuel sales volume surged over 600% year over year, supported by a mid-2023 launch, strengthened supplier relationships and reliable supply chains. These efforts help customers meet INOGHG targets while offering sustainable, cost-effective alternatives. Looking ahead, CBL plans to expand biofuel offerings, explore new ports, and further stabilize supply chains to reinforce its leadership in green marine fuels. Additionally, the company is evaluating LNG, melatonin, and hydrogen to meet involving sustainability regulations and industry demands. Our ESG initiative and corporate responsibility reflects its commitment to creating long-term value through environmental, social, and governance excellence. At CBL, we've embedded ESG principles at the core of our business strategy to future-proof our operations and create long-term value. Our three strategic objectives form the foundation of this commitment. First, establishing robust ESG management capabilities. Second, proactively fulfilling stakeholder requirements. And third, enhancing both our market competitiveness and sustainable financing assets. These efforts translate into four clear competitive advantages that differentiate CBL in the bunkering sector. We are gaining a first mover edge in greenfields, sustainable and systematically mitigating regulatory and transitional risks. building unparalleled trust through transparency and maintaining full accountability across our value chain. Our visionary approach is demonstrated through industry-leading initiatives. Our ISCC-certified biofuels program directly supports IMO 2023 and EU Fit for 55 targets. specifically targeting Sto3 emission reductions. The results speak for themselves. We achieved over 600% biofuel sales growth in fiscal year 2024, using 100% waste-based economy feedstock, ensuring zero deforestation impact. To institutionalize these efforts, we've established an in-house ESG committee that oversees our energy transition roadmap, GHG reduction programs, and sustainable sourcing policies. CBL's 2025 ESG plan and long-term commitment underscores the importance of adopting ESG practices to enhance transparency, implement sustainable initiatives, manage risks, and meet stakeholder expectations. On the environmental front, CBL leads with its biofuel initiative, aligned with IMO's 2023 strategy, blending marine fuel oil with 24% eucomi to reduce greenhouse gas emissions. The company also supports customers in achieving sustainability goals while ensuring its biofuel production avoids deforestation, land use changes, or competition with food production. In terms of social responsibility, CBL promotes equitable practices, including adherence to pay-for-performance principles, fostering diversity and inclusion with strong female representation, and supporting employee development through education subsidies. CBL also prioritizes employee well-being with regular events and encourages community engagement by offering staff time off to volunteer. On governance, CBL ensures accountability through annual director elections and rotation, robust stock ownership guidelines, and strong board oversight. These efforts underscore CBL's dedication to sustainability, corporate responsibility, and long-term growth. The plan is structured across three phases. Q1 to Q2 2025, establishing a sustainability strategy, governance framework, and action plan. Q1 to Q3 2025, improving sustainability management and implementing the sustainable development plan. Q3 to Q4 2025, enhancing disclosure practices and strengthening investor relations. Let's move on to strategic initiatives and market outlook. Look ahead to fiscal year 2025. Our key initiatives include expanding our service network, strengthening our presence in the Asian and Europe markets, Entry into emerging markets, continue expanding port coverage. Maximizing sales volume, targeting new customers and segments while maintaining strong relationships with existing clients. Enhanced market position, stronger and more in-depth supplier relationships. Exploring sustainable fuels. Biofuel adoption remains a core focus alongside exploring other sustainable fuels. The global green marine fuel market is expected to grow at a CAGR of 50.4%, creating significant opportunities for us to lead in this space. To address current challenges, CBL has outlined a clear strategy to improve its performance across three key areas. First, to improve gross profits, the company plans to increase sales volume through network expansion and new customer acquisition while leveraging its network to mitigate supply chain disruptions. CBL will also focus on developing biofuels and exploring sustainable fuels such as methanol and LNG for higher margins, alongside achieving economies of scale to reduce unit costs. Second, to maintain sufficient cash flow and manage working capital. CBL will prioritize the strong cash position, strengthen liquidity, and closely monitor accounts receivables and payable. Accessing the capital market at the right time and utilizing bank financing will further enhance financial flexibility to support growth initiatives. Finally, to enhance efficiency, CBR will invest in automation and IT systems to streamline operations and explore advanced technologies for continuous improvement. Cost saving, upgraded back-end systems, and implementing real-time order tracking and data analytics. These efforts will improve customer service and operational efficiency, ensuring sustained progress and long-term growth. Thank you for your attention. We are now happy to take your questions. Please feel free to share your queries and questions on the online box, and I will facilitate the discussion alongside with Dr. Che and Mr. Feng. Okay, the first question is from Cathay United Bank Company Limited, Steven Poon. The question is, despite impressive revenue growth in 2024, the company transitioned to a loss. What drives this shift? And what factors caused the cost of revenue to increase more than revenue in 2024? And how will we address this going forward? Can you discuss the factors behind a significant increase in operational expenses in 2024 and your expectations for expense management in 2025? This question I would like to direct to Nick to answer.