DHT (DHT) 10 Aug 212021 Q2 Earnings call transcript

[Indiscernable] and thank you for standing by. Welcome to the Second Quarter 2021, DHT Holdings, Inc Earnings Conference Call. At this time, all participants are in a listen-only mode. After this presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. three our the CFO have Trygve Svein We and Munthe, Laila Instructions] speakers co-CEOs, today, Harfjeld, [Operators Halvorsen. CFO I the would Halvorsen. today, conference turn Laila over to now your first like to speaker go Please ahead.

for by morning Good Munthe. XXXX everyone. thank Second good Thank Svein joining I'm Harfjeld, you. Holdings, joined and DHT call. Co-CEOs, Welcome afternoon, and you DHT's earnings Trygve Quarter and

dhtanker.com deck link we go be XX/XX. slide As financials before I call, your the make will replay our until A will on started dhtanker.com can following this to the highlights through we open usual, to be conference questions. website, The we website, some and up call would get at like available of remarks. the today's found Before with our

be exhibit Form to SEC our release our and website press the our an In addition, EDGAR earnings as available on system will X-K. on

As regarding these the trading on face. in EDGAR for risk SEC available Actual forward-looking are and of outlook that expectations charter of a activity; and reports are statements. dividends, results and to including oil conference tanker nature. oil that information patterns; urge rates our this DHT's the including and the new website these in These schedules. share in prices general; periodic we markets reflected forecasts and on level We factors the scrapping; high matters vessel discuss projected prospects, reports, repurchases, based world debt on call, may from will reminder, utilization; future events, on system, drydock we repayment; anticipated buildings forward-looking and more for economic our statements forward-looking daily expectations about differ current read our materially in the risks you

X OpEx the per was and XX X.X Looking at The million includes related sale a related fair XXXX result non-cash income for half positive was day. to in first at $X,XXX to recorded Quarter market, of million second an X.X gain the very In quarter quarter $XX,XXX per the In gain TCE and Second the net and X.X of in related historically the XXXX. and quarter to both day, million of the numbers of Raven, of DHT difficult profit of value million. amounted Company XX.X second XXXX challenging are million. non-cash the of came and for a highlights EBITDA of the G&A to for the was million to And the million. quarter derivatives pleased Lake DHT to a for XX.X we refinancing, XXXX, per first average rate interest P&L TC the average while equal day. tanker of half achieved have $XX,XXX for the

XX Company's ended the million, Total cash. the quarter-end, under the with million credit At Liquidity over both quarter million Balance XXX availability Moving of sheet, June was the putting as at XXth. XXX revolving to of facilities

XX% Nordea debt and based the values to strengthen the was Facility, during the about Financial leverage prepayment XX.X quarter-end. sheet at the per the quarter. down We on Credit the ships have of refinancing continued vessel and million net is with balance market for

over to prepay related the EBITDA. in and will million million. with was was XX XX Quarter and sale With [Indiscernable] used maintenance payment, cash ended X and dividend call was million. to to from working and XX CapEx. repayment XX long-term was [Indiscernable] cash. of XX generated used with refinancing. million changes scrubber in the buyback amounted the Looking Ordinary interest Proceeds was million I million XX debt issued at of sharing debt [Indiscernable] Trygve. the million to cash to capital bridge, that, of the and million, we XX amounted with cash and of XX in repayment vessels million million turn started connection used XX for debt the Quarter

Laila. capital you, Switching Thank now to allocation.

For the will second quarter, a to shareholders. be XX.X of total million returned

Company the XX.X of million. quarter, total the through outstanding back during previously a for bought X.X% As shares announced, consideration

DHT a wanted In addition, the has be the dividend every of per quarter with August. years. update on of the Osprey. ship we then The provide will now and again, broker and XXth $X.XX fleet side. Company as XX August XX.X for some the are that payable previously the It and eco-ships First XXth the XX% to took of shareholders bought for during dividends higher. on little paid paid of DHT now to modern note will We And quarter. value And Scrubber-fitted Company And pay you share announced, we the delivery of per of Harrier, Half. that, assessments a X record million

we sales. these during recorded a gain We expect built new million Second million a of XXXX XX.X about sale. delivered delivered X.X also we and X sold were on our that spring. in Condor The was ships, to the its book during the to all oldest profit owners The and and Raven Quarter DHT July, Lake on

the us On on you liability quarter. an update the let the on then what of balance side going on the provide sheet next has slide, been during

of of of announced, and facility X.X profile, tenor, the new years XXX margin we covenants. refinanced Nordea commitment has DHT new Nordea a with the XXX with style loan accordion. has The X.X%. a repayment a facility normal firm It XX-year expanded previously a carries have The a carries a and new addition million, million As facility. old DHT the

million regular the from under old we pay continue only XXXX on installments The having to X.X facility. able the of from XXXX benefit were new and through now per the facility this and are we Harrier importantly, all prepaid acquisitions. XXXX and for each The Osprey. installments for Additionally, year to two

the In of more of levels our for comprised ABN and minute, low our Second year, the low or From the we on facility, revolver this X runway a see loan. have loans. syndicates cash this our capacity. million relatively extended on will credit rates haveXXX next. large slide, break-even smaller prepaying break-even Amro debt all the under can provide During table XXXX you cash on very large by we Quarter, Svein available installments bank other the lighter rest XXX and Further, currently X that we of a million color

We we have of a needs half than note regular finally, more the for of until for And all next year. installments second the no of mere Fourth X year will refinancing XXXX. million no that have you and Quarter XX this million

banking support As you can strong enjoy universe. to we our see, from continue

the our XX years in achieved terms the over in demonstrated Something with best we've Svein. that helm the refinancing. by was we're will clearly Which DHT. I at And of it of to pass this fact, that,

we the Thank connection employment will you, of with of and breakeven cash firing next In fleets slides, our Trygve. the levels. drydocks discuss X

spot employment On ratios during Quarters X the time the first short-term the page, last of you of and expected will see XXXX.

covered average Third our rate $XX,XXX Quarter, we fleet of of the For about per charters at have XX% an day. on time

these per we at XX% short a earnings an to in time we average of decent Quarter, consider XX,XXX far, day. income are of markets. the booked charters Some nature, the Third the for opportunity for Thus have fleet as of stock rate offering premium

enter an of on For the term about the available day. of combination into fleet to time the as per a durations at we fourth charters some near and expect in quarter, rate additional time We XX,XXX consider average don't be of have to charters XX% compelling. currently we don't rates

of back, bring market spot you forward noted quarters take many to to have few of drydocks. As a advantage started we the weak

XXX days recorded we about the drydocks. off-hire quarter, During second connection with in

ships. will also of A end XX additional an installation XXXX. This half our The We period treatment of quarter, expect efforts hard mark ballast the all to out to in work fleet retrofit and to only to days these days fourth XXX the plan now. second all done of our another water is scrubber XX key days XX with systems that program of have the the be benefit during scrubber to for XX of this the during XX to we for includes scrubbers. third quarter. in XX Taking XX

fleet in whole focus are and a cash even. dance at freight The ready positioning levels healthier we As ensure on we charters time be fleets. repayments enjoy such debt breakeven fleet our time combination a to expect fleet on we much markets break our with keen our spot one should made the floor very the for robust place, cash as that for the in we've It have specifically. applies [Indiscernable] both

XX,XXX of fleet per you full for from the As the per the graph will XX,XXX year. the second neutral a full On our Company are needs the first the XX,XXX day. XX is this And drivers half marked to to during fleet spot generate generate left half the reflecting for for XXXX per spot day similar you with robust, the key out in downside for away very debts X giving the cash upside. neutral. net been stand limited only behind scheduled numbers million the that for protecting of these We without ships the are the on fleet our needs slide, will graph have cash drydocking. be very the the to prepayments year these The and as that see right, only ships to for illustration see CapEx the Company made maintenance XX,XXX on planned in think day. the from And numbers of be

impacting but we markets fleet the OPEC the retirement the be. at cargo drags could recovery tough than older But said, bit coming longer what a And faster the too simplicity think have delivered suggest. It's This being and in increasing gradually too down, there's come of ships. are there. later many and is this been new supply. still the Oil little on more and without could brutal its recovery We the this picture. the is being time happens all levels most when inventory is And constructive a ships the people out, growing COVID demand and the ships. plus out because are

renewed X, some for prices we and strong at levels Operator. fleet are a low breakeven at our we And and we banks. to on we with all buying sheet can ships Let's have XX% X, control open hard our paired present. next with attractive what In at modern terms this package view. this financing have secured with position. for Q&A. a a by very new opportunities working safe balance both up markets that, in we liquidity year. and quality for excellent And our X, executing universal are our how positioned. X, an enjoy control are good X fleet ships X our we lending selling are cash oldest some, year of healthy supportive we all we leverage with and the

of line the [Operator We please Givens Instructions] Randy take our you. first from Thank now ahead. at will Jefferies, question go

Your now open. line is

Svein, are how and it How Laila, is going? you Trygve,

Good How thanks. Texas? is

well, your All everything me, Excellent. but for with A here. questions good fleet here. a is of little down warm, couple starting

you to recently do time bought And all a for an How feel the bit X do X outs, You not then these ins you're you looking little modern oldest this more time about mentioned exposure? to sold year. VLCCs, your currently? but charter appetite grow fleet you any charter VLCCs

not I we're time general, think as we've in. said many chartering times in before, entertaining

service And So have under there control the for our It like that so breakeven to essentially One, ships technical operations, to it financing. they use a of are impact control full for reasons -- also negatively customers. our our such. will few that. cash XXX% the is levels we

did generally [Indiscernable] time -- all that, So we with so well of charter

then asset additional And terms purchases? or sales modern in of

we no on have selling this intention recovery. of the of any ships side, of sell the the On side

of As faster appreciation the than had in past, values have expected. discussed and secondhand a we quicker happened little we the

to So that not that where quite any we the we're gotten have we level buy have. sell. we think with currently really intentions a or fleet actually And we've to pleased do

it's whole as XX for runs fields territory us we and can. well the a as we see So

cent Okay. regardless slide, that looking committed And you've of earnings. know allocation at to I dividend, then X capital that been pretty

the there. buyback. at use good share looking also cash of Very Just

thinking you more the in that, get are You behind how here X.X much remainder you returned shares. share year? the to buying shareholders that of the and to how million was repurchases the looking calculation, at XXX did What

that's by just years. as over not regularly price that Again, to a shares as NAV too that find and we But then two typically back of extent. it the that felt disconnect the beginning a the on couple said, the after year, the alignment to have we prices off and really the that We that in same be and things is then its before, the we we we really between ships second-hand took are so It's bought way share up we've share see weren't buybacks. doing acquired we we intrigued at prices, hadn't when need accelerated NAV, of opportunities. said a

to So made form that our shares we sense. of thought the buy ships buying in own

forwarding appetite, be purely be well decided those to anything that, very so that spend as no could or from far there will that's As to to continue like it it's x on buy some, same side. but going that but factors, dollars want a our is we million approach we opportunistic target

Got it.

number prudent. on you've far quickly on the XQ? And guidance rates just vessels. have Sounds Do that spot at booked Quarter that date spot for the so you a

spot fleet, X/X below at the that's It's of and XX,XXX.

much. so All Well, thank XX,X. hey, right. you

Thank you.

Please ahead, Securities. next now take open. the from the is Clarkson will line We Omar from line your now of question go Nokta

Hey, much. guys. very afternoon. Good you Thank

question maybe Just time-charters. discussion the the around bit regarding Randy's a -- on following little

over Given paid on that at of years, several you time X off extremes charter last clearly it's past least booked we've to had your here year. for the have you such ships

-- And was Quarter, so this closer your basically. you to earned was wipe much spot it market, on overall but the XX,XXX fleet TC XX past

many know have ongoing you scheme, how think there basis, your grand you do charter? on term just very that the percentage about in the vessels think that forward, what general, near DHT an in time to but you I when in Going on want aren't do opportunities,

attractive. numbers. at that year, don't And but We very numbers percentage the target, our a were X we have last obviously we nominal look

really we could. did as as much we So

Some [Indiscernable] the been of in charters to has year these an spot trading market. more of this alternative

So do very as -- to are can. should charters us recovery, as next time when healthy, -- much you the but in little certainly expect numbers we do we'll and

sense elders?. -- just that's economic Amish X the these good [Indiscernable] So what is the but it's guidance makes percentage not for

fine. That's

bit to another call Okay, part prior seeing unexpected an what -- delay the been that's in clear there a it to recovery follow-up Clearly, points. guess least of especially stock at recently, maybe performance. or has the least of the the respect a delay, variant with and with I discussion from Delta tanker we're this a at

tight Especially has of does at to a time looking that, 'XX, healthier knowing it's 'XX, then say? when do once picture very here sweet about really bought of be invest, available. the for capital, path turn. perhaps you just book, maybe Given investing? the the you opening know beyond [Indiscernable] 'XX no it that, come tankers, 'XX, order supply market you some the and you paint on it and in earlier we're become as with for real maybe positive [Indiscernable] rates then do after basically 'XX, your investing you're remarks, But I feel in XXXX a spot when capital? mentioned you duration feel the moment. about year. potentially how healthy standing the market do a upswing 'XX, How do at deploying side. it And a fine -- the What's this think Is about

just the asset to earlier much us you why point the Company it. said ships This we're a a a XX to will this investments. As some the design look younger. invest the life back X-year-old already quicker earn took it's cash in for rates the be to investment? this that But sweet at recovery in If will equal that for happens, reason spot. is fuel X-year-old the in of or XX ratcheted we considering us X-year-olds when invest, to the prices those churn year, step up felt that the buy, open? with Keep ships reason mind open We're when a of at XX XX of late or be remaining than and We important once expected it the what very or money dissimilar it we too for happy life lot look opportunities the to can earlier, The the not had is same. and really have certainly required Spring. XX -- months. has. built to -- of in basically with economics there out from ships also over view, an of we means also that's a return look we levels,

but not will So think remaining levels you ship. we're that there ships, represent have more investments against be buying over the of the to good life

it. ov Got I for Thanks. Thanks [Indiscernable] that it will turn

The of Tsung Please Research. now We go is Chris will open. ahead. line next now line the question Webber take from our from

everyone. afternoon, are Good How [Indiscernable] you

Hello. Yeah. Go ahead.

between secondly, What seeing on non-scrubber scrubbers that Got all guess question have and And a guys XXXX fitted Thanks. the scrubber of? guys I you the you sort two-part it, sorry. a vessels, regarding sales are on spreads? announced scrubbers. it's that. with we vessel?

So is to that vessels? a sell requirement

maybe, in answer from been the first sold -- there the have they're latter but us, To not ships scrubbers part without market.

mainly that more owners. an for being So they're private well. typically is with maybe picked appetite basic -- and as that there up But been specifications coming out Japan as more of ships has such. by

you million of year. yourself. the For us, discover do but that. use you you they to [Indiscernable] also payer is That's the That for very well-maintained there ships. $X can maybe also That's own a -- so normal good Currently, was it interest annual the in math an numbers about them bought and transportation that particular of over needs. because additional get in ECO-ship will benefit our will rest these can was the earnings ships, the they're industrial

more vessels. part the -- my you I question sell just planning are access any know I And guess Thanks. Okay. -- was just guys of form could of we a to second not

it But about to scrubber were fleet your that not? selling guys have it, you guys entertain could of at the stopped from You to or does the has -- program your a thinking part vessel, if be trying XX. just scrubber

is When on you a price. essentially sale. Yeah. all tank do run Company, the [Indiscernable] depends for everything the It

in been we where or us. carved shareholders not the be And older of think ships end scrubber are some from that adds -- your soon behooves or to that only But sold without stone fleet. Hopefully, of scrubbers. you all older note selling it is It oldest and traditionally, sell we that that ships the scrubber-fitted. we it's all scrubber-fitted, sense out will So will makes where question. our a the the it with to with or color have said,

turn perfect. over. Thank you I'll all. Yeah, it that's

you. Thank

now, next line Please from We Evercore. our Chappell take the will Jon go question ahead. of from

now is open. line Your

Hey, of everyone, morning. this signed TCs Chappell a is trip we extension for or types you results. use charters that figures It signed rate since X the higher the I'm to is this being one-year those we should Jon could Sean Morgan just QX on just wondering last if for of the and on X get rates over those some appears year? there are ship -- than well-time extended

I'm to -- raise value. I relate of what's for you should average think [Indiscernable] not makes each to in going we It the I'll on the the the the now disclosed have so particular be share numbers of so. charters, fleets disclose quarter, straight?

then And interesting. Thanks. I think the slide, breakeven on Okay. that's

CapEx quarter, even -- of able in terms reducing ability further? You'd just the those per breakeven to of there this but point reduce costs, any the for offset or are OpEx pretty the the to be some is efficient at coming maintenance year

view a our way have ships. we the we long-term Yeah, of operate

of run is markets cost-efficiently. on what type OpEx of and we spend see independent we're that quite how also competitively But much you this in. So we

ship OpEx specifically we there's a question sharp per be for to just think But in all, and was the to your don't lower competitive. As we Laila breakeven. in that $X,XXX quite obtain cash said and any to find room cut day per Quarter to

Yeah.

you. Thank Okay.

Welcome.

next Ben take now from ahead. Stifel. will We the question Nolan of line go from our Please

is open. line Your

are it a that Thanks. preserving I back but that capital at done scrubbers, a decision feel many enough? docks as capital, have like don't don't Or to get Quarter? XX. wanted you're enough to have the that you're dry you beyond scrubbers simply allocation different it benefit so coming perspective, like maybe that a from they sufficiently here that don't Is it's ships efficient would you is challenging sounds market this

The is part question Right. of correct. your latter

eco-ships. are So these

fuel mature they the more much end the than less fleet. So consume of

is means OpEx the longer, So investment be compelling, payback that simply. will the

older are we So we're sort it how eco-ships set then got up That that's than there scrubbers ships without of pleased with the and some now. scrubbers. it's

Okay.

or Is at never soon. any where at -- there least fair? more ships will probably modern So we from not scrubbers, those now, sit that least have anytime

That's correct.

then retool at debt as cover into higher we more that -- it's associated you've pretty than substantially to form cash it more getting breakeven would be a And The a cash a little that and market, little to available, is or to you that available with concerning Is very there But in be you a debt. a is And amortization back bit thinking would assuming generating -- little back to cash of amortization flow needed distribute should break-even imagine shareholders looking that pick or to just point level? the the able get debt better next perhaps that one up nice been the other? Okay. and need to to repayment, bit hopefully maybe a through are easy beyond, first, bar. cash in that. year. low some

think what we [Indiscernable] need time flow is what to and the to to what today bond, think so we indicate the healthy the to thing to when But that do right available market going have enjoy up to whatever it's do is we're freedom But once with numbers. are to comes. market returns do we so cash choose no the amortization I once ramp free we want premature the we There's that recovers.

-- in Keep

Okay. Perfect.

that the to select a the loan the for schedule amounts. of -- period We prepay are will particular mind amounts in that facilities straight-line to need to position our --keep Company. then improve

in of of sort So some for it's not the point wall debt coming because we a at so. this non-amortizing future, debt have

Sure.

it. appreciate guys. understood. I Thank No, you, I Okay.

from income be minimum to is And net also, XX% a distributed shareholders. allocation to of capital ordinary our

the capital right? can phenomenal, if are obviously, policy, cash So flows of consider sorting use allocation Company that

the As you second saw quarter. for

thanks. Great,

line our And Instruction) (Operator open. now of we Surveyors. line your ahead, Silvera Marine the will from Ronald question next Please, from go now take is

are have Quarter a been last I of like that much levels XXX it This what now now just you Thank the I that notional you the call. very very, wonderful or accomplished. reduced is of done I appreciate this for through. suggest to in we've in [Indiscernable] my years is now. X quite nominal to find difficult job had what me you any would taking earnings you very would have are in In guys debt, debt over XXX. the debt you debt an you incredibly market in difficult been to it or now. million anywhere would this so as that case, if for of have bring future, I money shares. that be if $XXX it a [Indiscernable] will I quarter, near you but as bring far ton doubt something. still you've like not I you will realize options. buying to that this would sell been you suggest know $X where I some fascinating

class of classic it. well. to In my have to you that the next reduce you And Company do repurchases how the do Harvard if I guys Okay. that business the that case, will do to as you're of And is as you are that any able you them continue if you have Especially think input. whatever cover to sell. as cost any set aside run January. well options a way simply repurchasing, for shares That's cash straight this

the thank be what auction overall your not this you us something you. words and into. for market we And your there, we've appreciate of recognize that we past, Well, discussed for to we in sort kind can input. needs it as we be the Thank the may certainly but also something but find to liquidity get do

a a much said, But that period long, don't you before early You just a as will probably see see we a go we rather some, do years would to, tough as like and we, Because can get opportunities I'm your that you for shareholder many lot. may into it had through build market the XXXX. happen. now, sure in as you shows I cash come. great that do to And have in

[Indiscernable]

now next will our We take --

-- you Do have

Sorry.

any at your of Do of the still any you levels current prepaying have debt? intentions

premium I think installments do on a feel additional to payments soon. have XX with months cash come have healthier levels to X significant to And normal that more for unusually so large do the we and expecting low levels. here prepaid now we have any certainly break-even prepayments. that expect facilities regular all additional not we're Currently, intention back runway timeframe. we not XXXX, market We us make of the through within

Okay. you. Well done, guys. Thank

Thank you. Thank you.

Fyhr now next take our go Please from Magnus question the will We line Wainwright. of ahead. from

Your now open. line is

afternoon. Good Hi.

questions. two Just

to assume you be extremely than that in Is And it fair capital Company, faster wide that is as as been long today? depreciated real you You've would rather stock arbitrage than buying as your had secondhand thought. disciplined your strategy. allocation it the in buying as you own also mentioned back asset values vessels have is

right? did what bought So course, was the we than and they nominally cheaper less market. was X levels buying certainly sort But ships, in what -- ships. second Then of our we are in buying or the ships X compared were to of available X the quarter or

the So general, but fairly are I to have or to we or opportunity more ideally, ships. X, would of buy get. That's X sort opportunity agnostic like hopefully we'll think X, we the in

buying that time by you disciplined argue it's margin are saying think right, being paramount as just we high-end think in not that it's Magnus. a phenomenally could you We business, business. right. in, the it, it's -- that We And it's phrased over you buy

second the me question. leads That to Yeah.

Some the for appetite new for you of have pursuing feel your you your builds? do these fleet? a types And any positioned competitors the regulations How about new ship's do and have you're modern of dual-fuel fleet. like feel been of your buying how You new capability.

As we in we shape. said are in the summary, we feel excellent that

and that's next regulatory the over We up good the changes have coming well-positioned we're for few in a framework the fleet years.

that. and are just meet right that. to on on high, have reasons the a -- juncture for We're of at think. is will new confident are be lack is technology quite going we But we'll to forward. now we buildings that too this secondly, X contract able that prices there clarity not enough, so So One there

let's are staying [Indiscernable] of well-tuned and we developments we course So differently. be the think say, might of

Thank good. you. Very

Thanks.

like are the to go the no further I to there questions, Please ahead. would Company. now back If call hand

Ed. Well, showed everything to much day, and who all DHT thank in Good you very [Indiscernable] interest

Thank you for participating.

You may disconnect.