Pacific Basin Shipping Limited

Welcome to today's Pacific Basin 2026 Interim Results Conference call. I am pleased to present Chief Executive Officer, Mr Martin Fruergaard and Chief Financial Officer, Mr Jimmy Ng. For the first part of this call, all participants will be in a listen-only mode and afterwards there will be a question and answer session. Mr Fruergaard, please begin.

Yes, thank you very much and thank you all for your patience and welcome. And thank you for attending Pacific Basin's 2026 interim result call. We will start by highlighting the key points in the published presentation, followed by Q&A. Please turn to slide two. Dryball freight market strengthened year-to-date, supported by geopolitical disruption and trade inefficiencies, particular those arising from the conflict in the Arabian Gulf. We were well-positioned to benefit from the progressively improving freight market while continuing to outperform the market and deliver strong financial results in the first half of 2026. During the period, we generated an EBITDA Our balance sheet remained robust. As of 30th June 2026, we had a net cash of 157.2 million. We had available committed liquidity of 673.6 million and operating cash flow of 143.5 million. Please turn to slide three. We remain committed to delivering value to shareholders through dividends and share buybacks. For first half 2026, the board declared an interim dividend of 15.5 HKC per share amounting to 102.2 million USD. This is consistent with our revised dividend policy which allows us to distribute up to 100% of annual net profit excluding vessels' disposal gains when the company is in a net cash position. In addition, we repurchased approximately 9.5 million shares for $3.5 million during the first half of 2026 under our share buyback program of up to $40 million for the year. As our shares continue to trade below our fair market value NAV, we will continue to evaluate further buyback opportunities. including the interim dividend announced and the share buybacks completed year to date, Pacific Basin will return approximately 106 million US dollars to shareholders, equivalent to 103% of our net profit for the period, of course, excluding vessels' disposal gains. This reflects our continued commitment to delivering sustainable shareholder return. Please turn to slide four. As of end June 2026, we had a total of 254 vessels in operations, comprising 107 owned vessels, 30 long-term chartered, and 134 short-term chartered vessels. In terms of fleet renewal, we reshaped and expanded our new building program during the period, and we now have 10 new buildings in our order book, comprising six handy-sized vessels from China and four ultramarine vessels from Japan. We also hold the option on two dual fuel Ultramax new buildings. Including these two options, we have in total 12 new buildings on order with delivery between 2028 and first half of 2029. In addition to our new buildings and after declaring purchase option on two anti-size TCN vessels for delivery in second half 2026, we still hold purchase options on additional 13 long-term chartered vessels, which are declarable between 2026 and 2031. During the period, we completed the sale of one Supermax vessel and we have committed to sell another with delivery in August 2026. We will continue to look for different ways to renew and grow our fleet. We maintain a disciplined approach to cash, debt and capital allocation, balancing fleet investment, financial strength and returns to shareholders. We take a long-term, counter-cyclical approach in fleet renewal while maintaining our flexibility, When considering fleet ownership versus chartering in. This enables us to shift between owned versus long-term chartered and short-term charters as market conditions evolve and allow us to have the maximum optionality to grow our fleet. Our fleet is a result of many years of disciplined investment, which has created substantial earnings capacity and underlying value. Given the cyclicality of the industry and high asset values, it is important for us to maintain discipline and flexibility in managing our fleet and the employment of our capital. I now hand over to Jimmy for an overview of the interim performance and financial review.

Thank you, Martin, and good afternoon to everyone on the call. I will share with you the highlights of our business and financial performance in the first half of 2026. Please turn to slide 6. The market saw strong but also volatile freight rates in the first half of 2026. Geopolitical disruptions continue to be the key driver of the market throughout the period. In particular, the conflict in the Arabian Gulf, the temporary closure of the Strait of Hormuz, the resulting vessel rerouting and the fluctuations in bunker prices all contributed to market uncertainty and increased tungmai demand. During the period, market spot rate for HandySize was approximately US$12,200 per day, which is 40% higher year-on-year, and the rate for SupraMax was approximately 14,180 per day, which is 62% higher year-on-year. FFA for the remainder of the year remained strong, which suggests market expectations of a favorable freight market conditions to continue. Please turn to slide seven. In the first half of 2026, our average daily TCD earnings for HandySize was 14,150 and for SupraMax was 16,550. These numbers represent a year-on-year increase of 29% and 35% respectively. Our TCUs outperformed the average sport market rates during the first half by $1,950 per day for HandySize and $2,370 per day for Supramax. Now this equates to outperformance of 16% for HandySize and 17% for SupraMax. Looking forward, for the third quarter of 2026, we have already covered 78% and 82% of our committed vessel days for our Handy Size and Supermax core fleet at $15,810 and $18,680 per day respectively. Complementing our core business, our operating activity generated a total daily average margin of $1,060 per day over a total of 12,650 operating days in the first half of 2026. Now, this would represent a 49% increase in operating activity margin year on year. Please turn to slide eight. We continued to maintain our cost competitiveness of past years, reflecting disciplined festival management, effective procurement, and continued focus on efficiency. Looking into the composition of festival cost in the charts on the right-hand side of this page, you would see average daily OPEX for both Handysize and Supramax were broadly stable at around US dollars $4,790. The increase in depreciation for Supermax vessels was primarily attributable to higher dry docking costs. Whereas you would also see the average daily finance costs decreased by 15% to around US dollars $110. Now this is mainly due to a reduction in outstanding borrowings year on year. Long-term chartered vessel daily cost for handy size remained substantially unchanged, while that for Supramax was 5% higher, mainly due to higher long-term charter, higher cost. Please turn to slide nine. We delivered solid interim results, benefiting from strong execution in an improved freight market. Revenue increased 9% year-on-year to US$1.1 billion, while TCE earnings rose 20% to over US$660 million. As mentioned earlier, Owned vessel costs remained well controlled and broadly in line with the previous year. Chartered vessel costs increased by 10% and that was mainly due to the stronger freight rates during the period for our short-term chartered-in vessels. Operating performance before overheads increased to $138 million compared with $62 million in the first half of last year. With the robust performance, underlying profit increased to $94.9 million, and profit attributable to shareholders rose to $105 million, demonstrating the resilience of our business model in this highly cyclical market. Please turn to slide 10. We continue to be disciplined with our capital allocation and our financial position remained very robust with net cash of 157.2 million US dollars and available committed liquidity of around 674 million US dollars as at the end of the period. As of 30th of June, the total net book value of our 107 owned vessels was approximately $1.6 billion, while the estimated market value of our owned vessels based on independent brokers' estimates was around $2.1 billion USD. A strong financial position provides a solid foundation for us to pursue a wide range of growth opportunities while retaining the flexibility to capitalize on attractive market opportunities as they arise. Please turn to slide 11. Our operating cash flow for the period was 143 million US dollars, inclusive of all long and short-term charter hire payments. We also realized $9.5 million from the sale of one Supermax vessel. During the period with a strong operating cash flow, we repaid certain loans of $88.9 million in total. CapEx amounted to $57.3 million, and that included $19.3 million for one ultramass vessel that was delivered into our fleet in January, along with $20.1 million for dry dockings and other additions. and also in January and April we paid an initial amount of around 18 million out of a total consideration of 179 million for the six contracted conventional view handy sized new buildings. During the first half we also paid a total of 39.5 million for the two As of 30th of June to 207 million in cash with cash in hand and in addition to that we have 467 million and drawn facilities and that takes our available liquidity to a total of 674 million you see on this page. Now, all in all, our effective commercial execution and capital management enabled strong cash generation and that allow us to have the liquidity for future opportunities. Now, with that note, I will now hand you back to Martin for the updates on the market and our strategy.