Navigator Holdings Ltd.

Hi, ladies and gentlemen, and welcome to the Navigator Holdings conference call for the fourth quarter 2025 financial results. On today's call, we have Maz Peterzako, Chief Executive Officer, Gary Chapman, Chief Financial Officer, Oigan Linderman, Chief Commercial Officer, and myself, Randy Gibbons, Executive Vice President of Investor Relations and Business Development in North America. I must advise you that this conference call is being recorded today. As we conduct today's presentation, we'll be making various 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, March 12, 2026. and are as such subject to material risks and uncertainties. Actual results may differ significantly from our forward-looking information and financial forecast, and additional information about these factors are included in our annual and quarterly reports filed with the Securities and Exchange Commission. With that, I now pass the floor to our CEO, Mads Peter Zacco. Please go ahead, Mads.

Good morning and good afternoon. Thanks a lot for joining the Navigator Gas Earnings Call for Q4 2025. And just to get us started on the right foot, I'd like to clarify that Navigator Gas currently has no vessels inside the Hormuz Strait. We'll later touch more on the war in the Middle East and what it means for Navigator. We'll explain why the impact is limited. As usual, I'll review the key data from our Q4-25 performance and then go over the outlook for the coming quarter. After that, Gary, Oyvind, and Randy will discuss our results in more detail, and then there'll be Q&A afterwards. Please turn to page number four. As you can see in summary, we decided to call Q4 2025 a steady finish to a dynamic year, 2026 looking better. In Q4, we generated revenues of $153 million, same as previous quarter, and up 6% compared to same period previous year. The main driver of the increase in revenue over same period last year was 8% higher time charter equivalent rates and partially offset by lower utilization. Adjusted EBITDA was $73 million down from $77 million in Q3 and similar to the same period previous year. The balance sheet is strong with total liquidity position less restricted cash of $246 million at quarter end, significantly higher than same date the year before. In November, we increased our capital return to 30% of net income from previously 25%, and we increased the fixed dividend from $0.05 per share to $0.07 per share. This reflects our strong balance sheet and equally important also our commitment to increasing the return of capital to shareholders. We achieved very attractive financing for two of our six new buildings at margins of 150 basis points, equal to the lowest ever for Navigator. You should watch this space because more will come. On the commercial side, we achieved average TC rates of $30,647 per day during Q4. This is about $300 less than the 10-year high achieved in Q3, and is 8% above same period previous year. We utilized our vessels as guided at 90%, almost the same as last quarter, but below the 92% year prior. Throughput at our joint venture ethylene export terminal was about 192,000 tons for the quarter below Q3, but it was 20% higher than the same period previous year. It continues to be European demand driving U.S. estuarine exports, and we expect continued strong demand from Europe, but we also now see signs that Asian demand is emerging. Two ethylene offtake contracts have been signed for a terminal, and we will see renewed interest from customers to sign more. We continued the sale of older tonnage with Navigator Saturn and the Happy Falcon that were sold in January. I'd like to make two comments on this. First, over the past few years, we've consistently sold older vessels with attractive book gains and on average well above market value estimates. I consider this a recurring income stream and an integral part of our business model. Secondly, the older vessels are typically unencumbered and release significant cash. This cash has been and can be expected to be used for capital return. Looking ahead, it's obvious that the war in the Middle East creates uncertainty, but also commercial opportunities for Navigator. Overall, we expect both TC rates and utilization to remain or exceed those achieved in the fourth quarter of 25. We also expect exports out of Morgan's Point to strengthen towards or above the record export volumes that we saw in Q3 of 2025. Only 3% of global handy size volumes are loaded in the Gulf. Oil and gas exports from the Gulf have stopped, and that opens for alternative trading routes and substitute products. Producing ethylene from US ethane is a substitute to Middle Eastern NAFTA-based ethylene production. Ammonia also now sees longer ton-mile transportation. And on top of this, we see LPG volumes from Venezuela starting to be exported on the regular fleet, and that means not the shadow fleet. Lastly, I want to point out to the aging handysized fleet with almost twice as many vessels being older than 20 years, which compares well to the new building book. This can lead to negative fleet growth in the near to midterm. And with that, I'll just pass it on to you, Gary, so you can give a little bit more detail on our financial result. And before I do so, sorry, maybe I should just not forget to just have a quick look at the slide here. We are quite proud to show the overview here of the Weber's ranking of stock exchange listed shipping companies and how they are ranked on governance. You can see Navigator Gas was ranked number 16 back in 21, and we gradually improved to number 11, 7, 3, and to number 1 in the most recent ranking here. I think it's important for us as a company that the corporate governance work that we are doing is being recognized by Weber Research Advisory. And we'll, of course, do everything we can to stay in the top ranking here and continue to deliver very strong results, not only financially but also governance-wise. So not to be forgotten, and on to you, Gary.

Yeah, that's great. Thank you, Mads. Hello, everyone. During the final quarter of 2025, we continued wrestling, as Mads has said, with headwinds from geopolitics, but perhaps looking at events in 2026 so far, it perhaps makes the fourth quarter feel quite calm. However, so far, as Mads alluded to, Navigator has not been materially affected financially or operationally, and Oivin will talk some more about this. Returning back to the fourth quarter last year, we were able to report a very solid set of results, as always helped by our cargo type diversification, our geographical trade and flexibility, our market position and our strong financial foundations. Our fourth quarter 2025 results have even contributed to some annual data points that are record-breaking for Navigator, where we've been able to push and keep charter rates up and also maintain utilisation, supported by our flexibility, efficiency and cost management. On slide 7, we report strong fourth quarter TCE of $30,647 per day, leading to total quarterly operating revenue of $152.8 million and quarterly EBITDA of $70.9 million. The positive TCE result this quarter reflected a good performance across all our vessel segments and led to an annual TCE of $30,110 per day, which is the highest level since the previous cycle peak in 2015. Utilisation was 90% in the fourth quarter, right on our benchmark, and was slightly up by 0.7% compared to third quarter of 2025, but down 2.2% compared to the fourth quarter of 2024. Fourth quarter adjusted EBITDA was sent to 3.4 million, which is the same level we posted in the fourth quarter of last year. Then following the record revenue generated across 2025, we're reporting a record annual EBITDA for Navigator in 2025 of 302.8 million. Vessel operating expenses were up compared to the fourth quarter of 2024 at 47.6 million, with the increase primarily driven by the net increase in our fleet size following the purchase of the three second-hand vessels in the first quarter of 2025, as well as simply the timing of maintenance costs incurred. We've closed the year, closed to budget for our ROPEX costs, adjusting for the extra vessels, and there's more guidance for 2026 on slide 10. Depreciation is very slightly down compared to previous quarters, despite our now increased fleet, mainly due to two older vessels, the Navigator Pluto and Navigator Saturn, reaching the end of their 25-year accounting life during the fourth quarter, and hence they're no longer depreciated. And whilst it doesn't yet impact our income statement, we wanted to mention that we received around $9.7 million in November 2025, being the first tranche of the Norwegian government grant from their agency, Innova, towards construction of our two new ammonia-fuelled, ammonia gas carrier vessels. This represents just over half of the total grant, which the remainder will be paid based on construction progress. Our income tax line reflects movements in current tax and mainly deferred tax in relation to our equity investment in the ethylene export terminal and also in relation to the natural ending of our Indonesian joint venture business which happened in 2025 and which is not considered a recurring item and effectively represents the cost of our exiting the joint venture and repatriating our assets and profits. Randy will discuss our ethylene terminal shortly, but throughput volumes in the fourth quarter of 2025, as Mads mentioned, were 191,700 tonnes, down from 270,000 tonnes in the previous quarter, but up compared to the same quarter last year of 159,000 tonnes, resulting in us recording a profit this quarter of $0.9 million. Then overall for the fourth quarter of 2025, net income attributable to stockholders was 18.5 million, with basic earnings per share of 28 cents and adjusted basic earnings per share of 32 cents. This performance in the quarter contributed to Navigator delivering record annual net income of $100.2 million and our highest annual earnings per share of $1.49 since the previous cycle peak in 2015. Our balance sheet, shown on slide 8, continues to build and be strong. Our cash, cash equivalents and restricted cash balance was $204.9 million at December 31, 2025, which if you include our available but undrawn revolving credit facilities, gives total liquidity of $296 million at the same date. Taking out restricted cash gives total available liquidity of $246 million. This strong liquidity position is despite paying out $34 million for scheduled loan repayments, $10 million under our return of capital policy in respect of the third quarter of 2025, $10 million as payments for our vessels under construction in the quarter, and paying cash consideration of $16.8 million to increase our ownership interest in our Navigator Greater Bay joint venture by 15.1%. Our Morgan's Point Ethylene Export Terminal Investment on our balance sheet sits at an equity value of $245 million, but is fully unencumbered now, with the final $4 million of remaining debt having been repaid in December 2025. Alongside this, we've paid from our own cash a total of $110 million, as at December 31, 2025, towards the six vessels we have under construction. The difference of this figure to our balance sheet figure represents capitalised interest under US cap. The unencumbered terminal, the number of unencumbered vessels and the construction payments made from our cash on hand that we will partially recoup as we fix financings for our new build vessels, together with a still growing operational cash flow, are reflective of the financial stability and strength that Navigator is able to demonstrate. And to bring you up to date, including our available but undrawn facilities, we had around $300 million of available liquidity at the close of business on March 11th, 2026. On slide 9, we show a summary of the main capital events across the quarter, where, with a very supportive banking group and a strong underlying business, we were able to return capital to shareholders, raise funds for the construction of our new builds, reward our shareholders and continue working on managing our financing needs. We had a particularly active 2025 from a financing perspective in which the company successfully entered into a new secured term loan to buy three vessels, refinanced existing loan facilities, issued a $40 million tap of our senior unsecured bonds, and executed several new interest rate swaps to reduce our interest rate risk. We continued that activity into the first quarter of 2026, such that on March 2nd, We signed a five-year post-delivery secure term loan facility of up to £133.8 million, which will be used to finance up to 65% of the delivery and also pre-delivery installments and the construction of two of our new Ethylene Panda new build vessels. This transaction was executed at a very low margin cost of £150 basis points plus SOFA, And we would like to thank our banking group for supporting Navigator. And we really believe the deal and the very keen pricing not only reflects the banking market today, but also the strong and stable credit story of Navigator. In addition to our scheduled repayments, we now have only two relatively small debt balloons due in the next 24 months, with payments due in 2026 of $54 million in total, you can see on the bottom left. We continue to make substantial scheduled loan repayments with $34 million in the fourth quarter, and we have an average of $126 million of annual scheduled pro forma debt amortisation per year across 2025 through 2028. with our net debt to 2025 adjusted EBITDA sitting at 2.5 times at December 31, 2025. In addition, our net debt to our on-water fleet value results in a loan-to-value, or LTV, of 32%, which falls below 30% if you attribute any reasonable value against our mortgage point terminal. We try to use our balance sheet efficiently to allow us to reward our equity holders, whilst also ensuring we maintain a sensible position for the business and our bond and credit investors. And this balance is something we're continually evaluating, especially in today's environment. Our next priority is to close financing in relation to our remaining four new build vessels, and this work is already started with transactions well progressed. We're currently targeting to complete the finance for the remaining two ethylene panda vessels in March or latest April 2026, and our two ammonia vessels within the second quarter of 2026, and we look forward to being able to report on a successful outcome when this work is complete. Then finally, at December 31, 2025, 58% of the company's debt was either hedged or was on a fixed interest rate basis, with 42% open to interest rate variability. And this is another key metric that we keep under close review. On slide 10, we show our estimated all-in cash break even for the full year 2026, which at $20,970 per day per vessel remains significantly below our average TCE revenue for 2025 of $30,110 per day. The graph bottom left shows how this headroom has developed over the last few years, and you'll see in there the consistency of our business, particularly in the last four years, but even going back further. You can see on the top left that the all-in breakeven rate includes forecast scheduled debt repayments and our scheduled dry dock commitments, and the latest figure here is materially unchanged from the estimate we provided on our last earnings call in November 2025. On the right is our updated OPEX guidance for 2026 across our differing vessel segments, ranging from 7,900 per day for our smaller vessels to 11,400 per day for our larger, more complex ethylene vessels. This guidance also remains materially unchanged from our last quarterly call in November 2025. And below that is further next quarter and full year guidance across vessel OPEX, general and admin costs, depreciation and net interest expense in total dollar terms. The full year guidance for vessel OPEX towards the bottom is now lower in total than previous guidance given in November, given we have reduced our fleet size somewhat through vessel sales. Net interest expense is also a little lower than previous guidance given at the same time. However, both are materially unchanged. Slide 11 outlines our historic quarterly adjusted EBITDA, adding this fourth quarter's result. We now have 12 quarters in a row since 1Q 2023 of reporting at least $60 million of quarterly adjusted EBITDA, at an average of $71 million over that period. This comes back to our diversification of cargo types and geography that protects the business. On the right side, we show our adjusted EBITDA for 2025 and our fourth quarter 2025 annualised adjusted EBITDA. In addition, the bars then to the right provide some sensitivity and illustrate an increase in adjusted EBITDA of approximately $18 million, all other things being equal, for each $1,000 incremental increase in average TCE rates per day. As previous quarters, an update on our vessel dry dock schedule, projected costs and time taken can be found in the appendix, slide 28, should that detail be of interest. And with that, I'll hand you over to Oivind to provide an update on the commercial picture. Oivind.

Thank you, Gary. And good morning, everyone. We will go straight to the topic everyone is focused on, namely the war involving Iran. This morning, oil is treading above $100 per barrel, second time since it started. Natural gas in Europe is up by 70% since the bombs started falling. The Strait of Hormuz remains closed. Roughly 1,000 vessels are currently trapped inside the Gulf, and an estimated 3,000 more are stalled across the broader region. A significant number of oil tankers, gas carriers, and bulkers are caught up in the disruption. Three handy-sized vessels are trapped inside, none from Navigate Gas. A major portion of Middle East exports of oil products, LNG and LPG, representing roughly 20% to 30% of global supply in some categories, is effectively shut down. That leaves producers, consumers and ship owners in a very difficult position India, for example, relies heavily on Middle Eastern LPG for heating and cooking. Asia, more broadly, depends on Middle East for energy. And refineries depend on crude oil to produce derivatives such as nafta, which in turn is a critical feedstock for petrochemicals, including ethylene. Naturally, this has triggered an immediate scramble to source alternative supply. So how does this affect our undecided business? Let's turn to page 13. The map shown here was taken from our operating system this morning. It shows the entire navigator fleet. It has a very important story, though. First, to repeat, we have zero vessels inside the Middle East Gulf. Second, we have zero vessels positioned nearby in ballast waiting for the strait to reopen. Third, the vast majority of our fleet is deployed elsewhere. Trading from the US to Europe. Trading from US to Asia. Trading from Europe to Asia via the Cape of Good Hope. and in regional trades within europe within the mediterranean and within southeast asia out of our 55 vessels only four had been engaged in iraq lpg exports importantly those vessels are on time charter that means whether they are actively sailing or temporarily idle, fire continues to be paid, much like a leased car, where payment is due whether the vehicle is being driven or not. Even so, those vessels have already demonstrated the flexibility of the handy size segment, by securing alternative supply position, loading LPG from places such as South China and Australia. We are frequently asked a version of the following question. If 30% of LPG supply is effectively shut off from the Middle East Gulf, and now that the VLGC Baltic Index has stalled due to the lack of concluded trades, and most VLGCs are ballasting toward the only major alternative export region, U.S. and Canada, is the situation the same for Navigator? The answer often surprises people. Mats mentioned it, but across the entire global handy size segment, only 3% of total transported volume originates from inside the Arabian Gulf. And that, again, is 3% only. It's a very small number. And it means that there has been far less knee-jerk repositioning speculative ballasting or dislocation in the hand-sized segment than what is apparent in larger vessel classes. In fact, many operators in larger segments would welcome the degree of geographic and cargo diversification that we have. I have said it many times before, and it's worth repeating again, We are not a one-trick pony reliant on one loading region for one cargo. That diversification, both geographic and by cargo type, is working to our advantage in the current environment, which is shown on page 14. Demand for C2 cargo such as ethylene and ethane is firm. Demand for easy petrochemicals such as butadiene is firm. Demand for ammonia is increasing. LPG demand remains steady. We do not yet have final March figures, but utilization, as you see on top left graph, improved over the first couple of months of the first quarter. And at this moment in time, we do not expect any material change to our quarterly outlook. If we go a level deeper in the diversification story on page 15, the picture becomes even clearer. As mentioned, the Arabian Gulf accounts for only 3% of total global handy size volumes over the last few years. That is modest, especially compared to with crew tankers and larger gas carriers we mentioned. By contrast, for Navigator specifically, Approximately 60% of our earning days are generated from North America, and those earning days are in turn diversified across three categories, 67% petrochemicals, 21% LPGs, and 12% ammonia. We also see incremental opportunities emerging elsewhere. Venezuela is beginning to come back into the market. Two LPG cargoes have been exported so far this year, one discharged in the U.S., believe it or not, and one in the Dominican Republic. We fully expect to be contracting handy-sized vessels for Venezuela LPG exports in the near term. That would represent incremental demand for our fleet. Butadiene continues to be an important source of ton-mile demand. To put that into perspective, a single handy-sized cargo of 13,000 metric tons shipped from Europe through Asia via the Cape of Good Hope can generate roughly three months of vessel employment, and that is pretty meaningful to us. On ammonia, We are beginning to see some of the same dynamics that we saw four years ago following the outbreak of the war in Ukraine. As natural gas prices rise, ammonia production economics become more challenged in certain regions, especially in Europe. with consumers looking for more cost-effective alternatives. Instead of producing, they can import. We are actively engaging on a number of customer inquiries in this particular area. A similar pattern is developing in the US ethane and ethylene exports, as shown on page 16. Ethane prices remain stable. And just as a reminder, ethane is the most efficient feedstock for ethylene production. In a world where ethylene producers are paying extremely high prices for NAFTA, or in some cases are struggling to source NAFTA at all, those producers with access to ethane-based cracking enjoy a significant competitive advantage. ETEN exports should therefore remain resilient, and we have ETEN-capable vessels currently employed in this trade, and others positioned to serve exactly this demand. U.S. ETELIN prices have risen in response to stronger international pull. However, import prices internationally have risen even more, which means the arbitrage has widened. Today, Europe is the highest-priced destination, and unsurprisingly, that is where the product is moving. From our perspective, we are happy with that dynamic, as long as fleet utilization remains high and day rates remain robust, which they are. At our Morgan's Point ethylene export terminal, March is on track to be an all-time record month for volumes. In fact, we are receiving indications that throughput may exceed even what you see here, being the Kepler forecast in the graph. So this is definitely a space to watch closely. More broadly, we continue to see a structurally increasing flow of hydrocarbons from the United States of America to Europe. Europe needs American hydrocarbons, and our Atlantic trade is becoming increasingly structural in nature. By contrast, the Trans-Pacific trade to Asia remains more ad hoc and opportunistic. Turning to fleet supply on page 17, the outlook remains supportive, as Matt mentioned in his opening remarks. Fleet supply has been unchanged for more than a year. The order book stands at only around 10% of the existing fleet, while 17% of current vessels are already more than 20 years of age. That creates a healthy supply-demand balance over the medium term, and importantly, if a new vessel were to be ordered today, they would not be delivered before Finally, on earnings and charting condition on page 18, Our all-in-cash break-even has already been discussed earlier on the call. Current charter rates remain well above that level of $20,970 per day. Time charter discussions are taking place at levels above what you're looking at here, which represents the assessed 12-month chart rates from independent brokers. And certain spot trades, due to all the volatility and the attractiveness of American NGLs that we are involved in, are achieving materially high returns due to this volatility. So when we step back and look at the overall picture, what we see is this. While the geopolitical situation is clearly severe and highly disruptive for global energy markets, our fleet positioning, cargo flexibility, and geographical diversification leave us comparatively well-placed. In periods like this, resilience matters, and our handy size platform is demonstrating exactly that. Over to you, Randy.

Thank you, Oivind. Now, following up on several announcements we made in recent months, we want to provide some additional details and updates on those developments. So on slide 20, as a reminder, our recently improved return of capital policy includes a fixed quarterly cash dividend of $0.07 per share as part of our quarterly payout percentage of 30% of net income. As a result, during the fourth quarter, we paid a 7-cent quarterly cash dividend totaling $4.6 million, and we repurchased over 300,000 common shares of NVGS in the open market, totaling $5.4 million for an average price of $17.68 per share. Now looking ahead. In line with that new return of capital policy, we're returning 30% of net income, or a total of more than $5.5 million, to shareholders this quarter. The Board has declared a cash dividend of $0.07 per share, payable on March 31, 2026, to all shareholders of record as of March 23, 2026, equating to a quarterly cash dividend payment of $4.6 million. Additionally... with Navigator shares trading well below our estimated NAV of north of $29 a share, we will use the variable portion for the return to capital policy for share buybacks. As such, we expect to repurchase $1 million of our shares between now and quarter end, such that the dividend and share repurchases together equal 30% of net income. And as Mads alluded to, we continue to repurchase shares and believe there is upside from here. Turning to our Ethylene Export Terminal on slide 21, As guided, ethylene throughput volumes fell slightly to almost 192,000 tons during the fourth quarter, as European ethylene demand softened and end users reduced inventories, and vessel availability remained relatively tight. Now, despite those lower volumes, it was encouraging to see some new customers step in to take cargoes, spot cargoes, to both Europe and Asia during the quarter. Now to the really good news. As you'll see in the bottom left chart, we expect volumes in March to reach a record high of close to, if not more than, 120,000 tons, which could result in a quarterly high in the first quarter of 2026. Now looking at the bottom right chart, despite the near-term increase in U.S. ethylene prices, the ARB remains wide open as multiple European crackers are undergoing turnarounds and Asian demand for U.S. ethylene is also increasing. due to that recent surge in oil-based NAFTA prices, as Oydin was mentioning. Longer term, the forward curve remains stable, around 21 cents per pound, or $460 per ton. Now, as for contracting the expansion volumes, we've been saying that new off-take contracts would be coming soon, and we're pleased to announce that two new off-take contracts have been signed in recent months. Now, we continue to expect additional off-take contracts will be signed throughout this year, as customers continue to request updated terms for both the terminal and for shipping. In the meantime, we'll continue to sell volumes on a spot basis. Now, turning to our fleet on slide 22, our fleet renewal program continues to progress, most recently through the sale of two of our oldest vessels. On the same day in January, we sold the Navigator Saturn, a 2,000-bill, 22,000-cubic-meter, ethylene-capable handy-size gas carrier to a third party for almost $16 million, netting a gain of over $10 million. And we also sold the Happy Falcon, a 2002 built 3,700 cubic meter semi-refrigerated small gas carrier to a third party for $4 million, netting a gain of almost $2 million. So that roughly $12 million profit will be booked in our first quarter 2026 results. We now have eight vessels over 15 years of age, all of which are debt-free, and we continue to engage buyers who are showing interest in acquiring these older vessels. Now, on the other side of the equation, we'll continue to pursue accretive second-hand vessel acquisitions as well, and we will also acquire more of our own vessels through share buybacks. Now, as a result of our recent sales, our current fleet now consists of 55 vessels with an average age of 12.6 years and an average size of over 21,000 cubic meters. To note, we continue to upgrade our vessels with various energy savings technologies. More details on slide 28. And we recently started rolling out new artificial intelligence or AI programs to make our fleet even more efficient. With that, I'll now turn it back over to Mads for some closing remarks before we get to Q&A.

Good. Thanks a lot, Randy. As you can all see, Q4 was a steady quarter with financial and operational performance that was much in line with the previous quarters. Our financial standing remains strong with ample financial reserves, few upcoming maturities, and a well-managed interest rate risk. Looking into this first quarter, we already delivered the first two new building financings at record low margins, and we are well on track to secure the remaining four within the first half of 2026. Cash reserves are expected to be further strengthened through the sale of older tonnage at attractive prices. The war in the Middle East brings uncertainty, but also opportunities for Navigator. As just described, we experience increased demand from customers due to new trading patterns emerging, especially for U.S. exports. Venezuela is another emerging opportunity in front of us. This all comes on top of what we consider a fundamentally sound demand and supply outlook, where growth in the U.S.-based NGL production is very likely to exceed the global vessel supply growth. Thanks a lot for listening, and back to you, Randy.

Thank you, Maz. Operator, we will now open the lines for some Q&A. So to raise your hand, press star 9, and then you'll have to unmute yourself by pressing star 6. Or if using Zoom, just use that raise hand function. First question, your line should be open.

Hey, good morning, everybody. This is Chris Robertson at Deutsche Bank. Thank you for taking my question. So just to recap on the Middle East situation, what might be the impact from the larger segments here. I know that you guys don't necessarily compete in the same trades as VLGCs, but any risk here that the VLECs or ACs can cannibalize some of the trade if they ballast to the U.S.? And can you talk about the potential on that? I guess it depends on the duration of the current situation, of course, but any downside risk from that?

I think I have to look at it so, VLGCs they do LPG, so clearly if I was a VLGC owner and Strays of Hormuz is shut, that delivers up to 30% of my exports, then I would ballast to the US and see if I can get a cargo slot or boat availability, which is scarce because they've been running quite full anyways. That's a VLGC conundrum at the moment. How does it impact Navigator? You need to understand that we, Navigator, we do not do LPG from U.S. to Asia. We do Etain and Etulin. And VLGCs cannot do that physically. So the impact from that dimension is limited. Now, you know, our Atlantic trade for handy size remains LPG, ammonia. BLGCs never do ammonia. And also ethylene and ethylene. So, yeah, limited impact on the downside should it be a pileup of BLGCs in the U.S. Gulf. Different businesses.

Thanks, Wyvern. Just looking at March here in terms of ethylene, a lot going on on price inputs and all these types of things. But in the meantime, there's also some unplanned and planned disruptions and turnarounds in the U.S. Gulf Coast. I think 6% of North American ethylene capacity is going to be offline this month by some of your competitors. Can you talk about maybe the landscape here? You mentioned it earlier, but incomings on both a contracted and spot basis, are you seeing an impact? Of course, from the Middle East situation, but are you seeing an impact from this outage situation, making your volumes more competitive here?

March looking very strong, as we showed. Sentiment continues the same into April. So I think whilst there might be reduction in production in the U.S. domestically, I think the international demand outweighs that. And that's why you see U.S. prices increasing. However, international markets needs it, and therefore bidding even higher than that, encouraging exports. So I think what's the direct impact of Middle East is taking the driver's seat in this one.

Got it. Appreciate it. Thank you, guys.

Thank you, Chris. Next caller, your line should be open as well.

You guys, Spiro Dennis from Citi. Glad to hear your crews are staying out of harm's way. Hope that continues. And maybe starting kind of on that topic, just kind of trying to think about your chartering strategy. I just think about the rest of the year in the context of some of this Middle East volatility. Sounds like you're constructive on prices and rates moving up from here. At the same time, you probably want to preserve some of that upside optionality. So, Oiven, how are you thinking about locking in vessels for term here, maybe leaning into some of the stronger market to do that once things have settled down a bit?

very dynamic we have never been in a position where we want to go 100 term and conversely never been in a it's not part of a strategy 100 spot either so generally we've been operating the last 10 years between 30 and 50 percent cover so If there's an opportunity to lock in a attractive rate historically, then yes, we definitely pursue that. But it's more with 55 ships, and I think we're pretty well covered today. We are looking at some extensions and so forth at decent rates, which we will probably do, but nothing huge change from what we've been doing over the last few years.

I should. The second question may be going to the fleet renewal. You called out in the slide about eight more vessels older than 15 years old that could be sales candidates here, I think all of which are unencumbered. So I guess on my math, I think those are worth collectively over $200 million. And so I'm curious, Is that consistent with your view on the valuation there? And as you think about reallocating that capital, what would be optimal and best use today if you were able to sell those in the near term here?

Yeah, I think doing it in the very near term would be difficult. I mean, these vessels are not sold in a very liquid market. And as you've seen also over the past two, three years, what we've done is we've sold two, three, four per year. And we might be able to do that a little bit faster, but I think you should assume that this is gonna take at least a year or two. So I think that the valuation is quite attractive as you suggest here, and it would free up a lot of additional capital. And as Gary was just talking about, and me also, we have a robust balance sheet at this point in time. you could say excess capital that would open up for further capital repatriation. And we would not go and plow it into a new building market or buy vessels at high prices for the time being. So we'd be selective as we always have been. Last year, we bought three vessels that were in a distressed situation and we bought them at very attractive prices. We're always on the lookout for that. But other than that, the consolidation opportunities are few and far between. So I think we would be in a situation where we would probably have more cash coming in than good uses for it in the new building or secondhand market. So capital return would be a big proportion of that.

Great. I'll leave it there for today. Thank you, gentlemen.

Thank you.

Thanks, Vero. Next caller, your line should be open.

Thank you. Hey, guys. It's Omar Naqda from Clarkson Securities. Thanks for the update. Obviously, a lot going on. I wanted to maybe just touch base back to the Middle East situation. And just on our ethylene exports from the U.S., you highlighted that in the fourth quarter about maybe 84% of U.S. exports went to Europe and really just 11%. to Asia. How do you see that mix evolving here? You mentioned it a bit in your comments, and you can see from the terminal that you've had a nice move up in throughput for March. But I guess, how do you think of that mix shaping up here for, say, the month of March? And what would that impact be on freight rates?

Thank you, Omar. I'll take... And perhaps, Rand, you can add some additional color. Sure. So in one of the graphs in the presentation, we included up to February. And up to February, January, February, 100% to Europe. Now, Iran happened on the 28th of February, I believe. And what's going to happen in March? So, we're just on the 12th of March, and you'd expect that some of that ethylene exported in March will head to Asia, because NAFTA and these other things we talked about, the dynamics there are completely turned upside down. So, So we expect that to happen. Now on the ton mile demand, that obviously is a positive. A voyage to Asia from U.S. Gulf is longer than a voyage to Europe. So we welcome those changes. Should the ethylene go continue to 100% go to Europe, I think in a situation today where utilization is quite high and rates are quite good, then we will be happy with that too. But obviously, the more that goes to Asia, the better it is.

Cool. Thank you, Oivind. And then just a follow-up. Saw the five-year charter, or perhaps it's an extension, on the Navigator Aurora, taking that vessel's employment up to 2031. Any details you're able to give us on the terms of the charter? I know, obviously, you don't necessarily give specifics on rates, but what it's going to be doing, what it's going to be carrying for the duration of the charter, and then Given that you have those four athlete MGCs now fully contracted, how confident are you with the four that you have under construction about getting long-term contracts as well?

That is the first part of the question. The Navigator Aura, since delivery, has been trading with Borealis, a petrochemical producer, bridging or taking ethane from U.S. East Coast, primarily from Arkosuk, to Stenungsund Cracker, that they converted to be able to use ethane and therefore bring the U.S. advantage to Sweden ethylene production. And she will continue to do that. So over the next five years, she'll maintain that virtual pipeline between the U.S. East Coast and Sweden.

Thank you. And then just in terms of expectations on the new buildings, do you have conviction that you'll be able to secure them on long-term charter as well?

We are very confident when we ordered it. And today, with everything that happened in the Middle East, we are even more confident. Why? Because if you're running an Italian production plant in, say, Asia, and you are facing these immense disruptions, you think twice about continuing how you have been doing it and rather contract attained from US. So in any case, we're confident.

Very good. Thank you, Ivan. Thanks, guys. I'll pass it back.

Thanks, Omar. Good to have you back.

Next caller, your line should be open. Thank you for taking my questions. This is kind of a follow-up to Oivind's latest commentary. And although it may be too early to ask, have you seen increased interest or urgency, let's say, from potential customers for the Eflin export terminal since the war in Iran started? And secondly, have you sold spot cargoes in recent weeks from the terminal? To what extent should we expect a contribution from this in Q1?

The answer is, the first part of the question is yes. We've seen increased interest for U.S. ethylene. You can see that in one of the pricing graphs. So why has the U.S. domestic ethylene prices have gone up? Why have they gone up? Because there's obviously demand, international demand. pulling prices up and then the commentary also was that international prices are gone up even more than the U.S. increase therefore encouraging trade ethylene are being sold both on contract and spot in march march is looking very healthy on the terminal side as randy and i mentioned and that was also before what happened because nominations for the terminal happens sort of in the middle of the month for the previous month so the terminal is pretty full even before this thing happened so uh so yeah we remain quite optimistic

Yeah, so a lot of the flurry of incremental spot cargos, they're asking, can you get it as soon as possible, right? But in March, we're pretty much sold out. So a lot of that will bleed into April. So that bodes well for the start of the second quarter as well.

Okay, that's very helpful. Thank you, guys. We'll turn it over.

We have a few other questions. This one for Gary that was included here in terms of, So new build financing, congrats on that. Do we have any updates for the remaining four new build vessels in terms of financing and the potential timing of those? Should we expect similar terms for those?

Yeah, thanks, Renly. As I mentioned in the first half of the call, we've got two more vessels under a financing package that we're hoping to close either this month or the very latest next month. And that's for the other two panda financings. And then the ammonia vessels, we're hoping and expecting to get that done within the second quarter, certainly by the end of June. I think that's very comfortable. And in terms of As I also mentioned, I think Navigator's credit at the moment is very good and the banking market is also very good. So we've got two things that are working very much in our favour. So we're very much expecting strong terms on all six vessels by the time we close. Obviously, there are some external factors here, but so far we've not really seen any impact on financing or banking activity and behaviours so far. I think that probably will hold because I think this hopefully is a short-term situation compared to, say, a five or plus year financing arrangement.

Thank you. Orvin, for you, can you please discuss the force majeure clauses in your time charters?

Yeah, time charters are generally like you lease a car, and if that road is blocked, you take a different road. Same for shipping. So you lease a ship, you charter a ship, and it's up to you to decide where you're going to sail her. So even if former straits are closed, it does not constitute a cancellation for those ships.

Perfect. Question here on the magnitude of the ethylene offtake agreements. Are Asian buyers looking at spot cargoes or longer-term commitments, and will the export terminal performance be more consistent in 26 than 25? I'll start there. You know, we have not disclosed the terms in terms of the duration or the magnitude of the offtake agreements, but clearly you've seen that already coming through the system, both more offtake in terms of term as well as spot cargoes. pushing up volumes in the first quarter and beyond. We are still actively negotiating some of the volumes, so we don't want to go into too many details there. In terms of the Asian buyers, it's a combination of spot cargoes coming to the market immediately and also longer-term commitments. Again, a lot of that is based on the higher NAFTA prices. And the third part here, will the export terminal performance be more consistent in 26 than 25? We certainly hope so. But yes, I think if you saw in the first quarter of 25, it was a loss, right? We had 85,000 tons for the entire quarter. First quarter of 26 will certainly be a gain and at least triple that. So the first quarter is certainly at a much stronger start than the first quarter of 2025. And as I mentioned, a lot of that strength is already bleeding into April and beyond, more off-day commitments, all of those things. So I think we can confidently say that From today, 2026 should be much better than 2025 from the terminal perspective. I think that completes our Q&A. So, Mods, any final comments before we end the call?

I just want to say thanks a lot for listening here and for the great questions that you brought. You know where to catch us if you have more questions. And other than that, we look forward to reporting next time in early May on the Q1, a quarter that has started with business as usual but surely brought a march which will continue. brought an entirely new dynamics here. And as we've discussed in the call so far, that there are a lot of opportunities that are coming our way. And we'll, of course, take advantage of those. Thanks a lot.