Navigator Holdings Ltd.

Thank you for standing by, ladies and gentlemen, and welcome to the Navigator Holdings Conference call for the third quarter 2022 financial results. We have with us Mr. Mads Pieterzakko, Chief Executive Officer, Mr. Niall Nolan, Chief Financial Officer, Mr. Oiven Lindemann, Chief Commercial Officer, and myself, Randy Givens, Executive Vice President of Investor Relations and Business Development in North America. I must advise you that this conference is being recorded today. As we conduct today's presentation, we will be making numerous forward-looking statements. These statements include, but are not limited to, the future expectations, plans, and prospects from both a financial and operational perspective, and are based on management assumptions, forecasts, and expectations as of today's date, and are as such subject to material risks and uncertainties. Actual results may differ significantly from our forward-looking information and financial forecasts. Additional information about these factors and assumptions are included in our annual and quarterly reports filed with the Securities and Exchange Commission. With that, I now pass the floor to Mads Peter Zacco, the company's chief executive officer. Please go ahead, Mads.

Thank you so much, Randy. And good morning, everyone. Thank you for joining our call. The third quarter of 2022 was an exciting period of growth for Navigator. We have announced two joint ventures to expand our operational capabilities in the global liquefied gas supply chain. In September, we announced that the company has entered into the Greater Bay Gas joint venture to acquire a total of five ethylene-capable liquid carriers. The first vessel is expected to be acquired next month. The joint venture with Greater bay gas will result in a reduction in the average age of navigator's fleet and will allow us to take advantage of more efficient vessels that is lowering our emissions and also offering improved economics for our customers. We'll see the rest of the fleet being acquired during the course of 2023. What's more, yesterday we announced our participation in an expansion project at our existing export terminal joint venture with enterprise product partners. in which we own a 50% shareholding. The expansion project consists of modification to an existing ethane refrigeration unit, which will provide the capability to refrigerate both ethane and ethylene alongside providing additional ethylene refrigeration capacity to our export terminal joint venture, the world's largest ethylene export terminal. Looking at the quarter overall, our operating revenues for the third quarter increased by 7.9% in comparison to the same period last year. And that was mainly due to an increase in vessel available days in fleet utilization, average monthly time chart equivalent rates, and pass-through voyage costs. Notably, the demand from ethylene from Europe that we witnessed in the second quarter of 2022 continued into July and August. So with About 80% of U.S. exports was transported to Europe. And that, of course, highlights the growing importance of energy security both nationally and locally in Europe. Utilization for our fleet in Q3 was 85%, which was in line with the same period last year and in line with our guidance for the quarter. I'd like to thank all the staff of Navigator for the excellent work and contributions during this period and just hand it over to Niall, who will take you through the financial performance of the quarter. Please now.

Thank you, Mads, and good morning all. The operating performance for the third quarter of 2022 generated an adjusted EBITDA of $41.5 million compared to $40.5 million for the third quarter of last year. Although this is lower than the $55 million achieved in the first two quarters of 2022, it is expected that the fourth quarter will return to or exceed those earlier quarters of this year. The total operating revenues for the third quarter were $106.8 million compared to $102.7 million for the comparative third quarter of last year. $2.2 million of this increase was primarily as a result of the additional handy-sized vessels joining our fleet as part of the UltraGas transaction in August 2021, and a further $9.6 million generated from the nine smaller vessels that operate within the independent independently run Unigas pool, also acquired as part of the Ultragas transaction. Vessel utilization improved slightly during the quarter to 84.9% relative to the third quarter of last year, which achieved utilization of 84%. And this contributed an additional $800,000 of additional income. And charter rates too improved slightly relative to the third quarter of last year, accounting for an additional half million dollars of overall increase in revenues. Average charter rates were just over $22,000 a day or $670,000 per month for this quarter compared to $2,1900 per day or $665,000 per month for the third quarter of last year. Four vessels entered dry dock for their scheduled surveys during this third quarter, in addition to the seven during the first half of this year, taking a total of 106 days and with a capital cost of $3.7 million. The dry docking of two of these vessels either have finished or will finish during the fourth quarter, along with a final single vessel to enter dry dock during this coming fourth quarter. As there are no new bills on order, these dry docking costs are the only capital expenditures the company has for the remainder of 2022. The operating revenue from the Luna pool was $3.2 million for the quarter, representing our share of the other participants' net revenues, with voyage expenses from Luna pool of $3.6 million, representing the other participants' share of our net revenues from the pool. Consequently, our vessels contributed 400,000 to the other pool participant during the third quarter. However, we achieved a net benefit of 600,000 in aggregate over the course of the first nine months of 2022. But overall, this number should net to zero over the longer term. Voyage expenses increased by 20.5% or $3.4 million during the quarter to $20.2 million. primarily as a result of the additional vessels in the fleet, most of which were on voyage charters, thereby incurring these pass-through voyage expenses. Higher fuel costs, which form part of voyage expenses, are passed on to our customers through higher charter revenues. Our vessel operating expenses, or OPEX, increased by 10.6% to $38.7 million for the third quarter compared to the third quarter of last year. much of which was as a result of the additional vessels in the fleet during the quarter relative to last year. Vessel operating expenses per vessel per day did increase quarter on quarter by 4.2%, but remained below $8,000 a day at $7,930 per day for this third quarter compared to $7,607 per vessel per day during the third quarter of last year. Depreciation on our vessels increased by 36.5% or $8.8 million compared to the third quarter of last year. As I stated previously, this is in part due to the 16 additional vessels that joined the fleet in August 2021, which accounted for 1.3 million of this increase, but also 6.2 million as a result of the company's decision to reduce the estimated useful lives of all of our vessels from 30 years to 25 years as of January 1, 2022. General and administrative expenses decreased by 23.2% or approximately $1.8 million to $6.1 million relative to the comparative quarter of last year. Another income being management fees earned from the other participants for the management of the Luna pool reduced to $60,000 for the quarter as a result of reduced revenue generated by the pool. An unrealized foreign exchange gain on the retranslation of our $600 million Norwegian kroner bond at September 30th was $5.1 million, and this was fully offset by an unrealized loss on the foreign exchange swap that we have in place, which is included in gains and losses on derivative instruments. In addition to this foreign exchange loss, the unrealized gains on derivative instruments also includes a $7.6 million gain for the quarter relating to further gains on the interest rate swaps as LIBOR swap rates continue to rise during the quarter as central banks around the world increase interest rates as they try to grapple with rising inflation. We have fixed interest rates on approximately 55% of our debt as of September 30th, 2022, at levels between 0.36% and 2%, significantly below current levels. The interest expense for the quarter was $13.2 million compared to 10.1 for the third quarter of last year, as a result of rising interest rates on that portion of the debt that is subject to floating interest rates, as well as interest on the additional debt assumed as part of the UltraGas transaction. Our share of results from the Ethylene Terminal were $4.7 million for the quarter, based on throughput charges relating to 189,000 tonnes of ethylene exported through the terminal during the third quarter. Lower throughput than the past three quarters, but higher than the 128,000 tonnes of ethylene throughput during the third quarter of last year, which generated $3.3 million for our share of the profits. Terminal depreciation amounts to approximately $1.3 million per quarter, giving an EBITDA for our share of the terminal of approximately $6 million during this third quarter. A net income for the third quarter was $2.4 million, a reduction from the earlier quarters, but with the expectation of significant improvement during the fourth quarter of this year. On the balance sheet on slide seven, The company had cash of $157.1 million at September 30th, with a further $20 million available from undrawn revolving credit facilities. Our minimum liquidity covenant from our various bank loans and credit arrangements remains a maximum of $50 million, thus providing significant headroom. Our total debt, which stood at $881.4 million at September 30th, was reduced by 38.8 million during the third quarter. Our debt comprises of loan facilities secured on our vessels of approximately 666 million, a credit facility associated with the terminal at 44 million and two Norwegian bonds which in aggregate total 171.7 million dollars. We are currently documenting the refinancing of our 215 vessel loan facility into a new six-year facility. as well as converting our September 2020 facility from US LIBOR to SOFRA, and at the same time extending its maturity by one year to September 2025. In addition, the 600 million Norwegian kroner denominated bond, equivalent to approximately $71.7 million, which has a maturity of November 2023, has a current call option, enabling the company to exercise the call on this bond, which would result in a redemption payment premium of 1.79%. On slide 9, we outlined the estimated cash breakeven for 2022 at $18,570 per day. This low level enables us to generate positive EBITDA even in the toughest of market conditions, and we have remained cash generative throughout the shipping cycle. In the box on the right-hand side of slide 9, we provide our expected daily OPEX across the vessel segments. ranging from $6,900 per day for the smaller vessels to $9,100 per day for the larger, more complex and older ethylene vessels. We also provide a range of expected annual spends for vessel OPEX, G&A, depreciation and interest expense on that slide. On slide 10, we outline our historical quarterly EBITDA showing an uplift in Q3 2021 and in Q4 2021, the quarters in which the positive impact of the Ultragas transaction were achieved. It also shows a consistent EBITDA of approximately 55 million over the prior three quarters, with only a dip in the third quarter to 41.5 million, which we anticipate will be remedied in the fourth quarter. And with that, I'll hand you over to Ivan for his remarks.