DHT (DHT) 8 Nov 222022 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Q3 2022 DHT Holdings Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. advised conference be being Please Instructions] that is today's recorded. [Operator the now CFO. to like would conference to Halvorsen, I Laila hand over today, your speakers go Please ahead.

you. Moxnes earnings call. Welcome joined by afternoon, joining Thank and Holdings I'm and CEO, President you Svein DHT XXXX thank for everyone. quarter third DHT's morning Good Harfjeld. and good

website, to before dhtankers.com. found for your up As will through go open be usual, can financials The we the link we on deck our and some highlights slide questions.

started conference Before I our like be get XXth. call, we with A would November at to today's remarks. following replay available website, until make call the dhtankers.com, of this will

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

available The our discuss show very as periodic on our conference more financial reports in are statements. statements the and these $XX.X strong a of that regarding healthy with for we These million SEC we risk in factors these on including cash. to to events will on report. our We are results the website in in differ based forward-looking urge As future reports detailed call, the and forward-looking information you that balance sheet risks about matters EDGAR materially company read continued system, face. on nature. the from forward-looking and may expectations a our reflected Actual quarter expectations this current ended reminder,

$XXX vessel about and for on of XXth. million scrap ship company's below which net values both liquidity $XXX is quarter availability end, putting revolving $XX.X as under significantly credit the current debt In September at was addition million, is market at for at XX.X% end, values. facility total was Financial leverage based the quarter million

gain includes million continues to rate million. per quarter was million. third for company TCE a income vessels Looking per quarter the and day share. for the at quarter, the third to and with $X.X time result equal million P&L $X.X The achieved The $X.XX to the vessel day, million fair $XX,XXX sale at spot making market G&A per $XX.X derivatives on million of at highlights. cost good of EBITDA and a for value In an with with the $X.X day. quarter at per the $X.X control company charter of in $XX,XXX the vessels in non-cash in related the gain of related net OpEx earning XX,XXX average $XX.X the came and interest

million. On the we XXXX next generated million debt quarter $XX.X million, a $XX.X cash $XX and slide, with the we cash $XXX.X million the of million. and the we treatment and quarter. rates. of with the from long-term was of was generated sale ballast working not We cash. cleaning with first sale fitted vessel of the amounted used and In proceeds exhaust share million. The $XX.X present through is to CapEx, XXXX. Edelweiss the was its repaid increased million, sale to was quarter for million allocated to payments dividend August, the million the net to ended $X.X and and shareholders freight installation to EBITDA. Ordinary special with of $XX.X due quarter debt in cash The system million while third repayment in were survey] bridge accounts buyback. delivered due interest and amounted million used built for million accrued $XX.X system sold we with to $X connection outstanding while vessel $XX capital for and million water debt prepay $XX.X was during In vessels gas third of maintenance the while of the for revenues receivable Net the gain change quarter $X.X related in $XX.X DHT change of proceeds in mainly started

additional five Also, $XX,XXX. sale, in substitute exhaust quarter. to the of XX from announced November company of fleet dividend. capital September the reborrowed. September, returned cash shareholders Charters QX we and prepayment reduced expected DHT Puma be have time net our is extend quarter for installation with $XX,XXX or share policy the allocation. the record under has In $XX,XXX the the been charter facility. metrics The the It to third gas income improved. quarterly vessel Switching The per the cleaning Nordea and to at into will $XX and day facility in a form AER implemented the EEOI entered two a prepaid average on 'XX dividend company shareholders year age This per contract into years payable tranche September, being credit we the the under Following credit and for to pay to a the of November 'XX. at option quarterly dividend. of respectively. as system contract and was The deliver of XX. after will In made was dividend in million $X.XX consecutive marks voluntary our XXX% maybe the revolving of policy new now XXst of

price X.X million of the All shares upon consideration purchased During retired million and million has receipt company average of the an were $X.X quarter, its the XXX.X for own of shares aggregate outstanding shares. $X.XX. currently at company an

call $X.X in to shareholders, I So Svein. for million quarter will dividends turn company the the over With $XX.X is share returning to the that, therefore and buybacks. million in million $X.X

to the we showing reporting the better table the are a new with quarter you, Thank provide this with on. On to purpose one guidance are respect we Laila. page, that succeeding

the a year, as fourth time this rate days, for period of day a book whole. XXX we an charter quarter average per So of the some have at quarter of a $XX,XXX covering roughly

based spot days have we Further, TC per day. available the on As to are own our income booked $XX,XXX estimated you at today, the your period providing for P&L we breakeven of model XX% spot spot X,XXX of the allowing unfixed for secured assumptions are the average been tell of the balance can rates as much, you this quarter the than of today, substantially are seeing what far. days We has for so we on the higher .

income You policy make at think dividend in going relation will be this to quarterly XXX% to include piece sense information our cash of that continue dividends. we forward in paid to of our new releases net to of good

XXX%. eco between are VLSFO year. we As systems investments exhaust the payback inside attractive our installations on current and gas announced year, with the taking cleaning with these The have offering spreads embarked HSFO earlier a this eight retrofit to project ships to on retrofit fleet

vessel being year time The first retrofitted vessel towards a the long-term that installation. end of into upon enter will will be completion of charter the a the

first vessels DHT Following this, during XXXX. and hence Colt the natural the quarter we of will Both the Stallion no will drydocks, commercial off-hire have retrofit DHT be taken.

are on next and vessels’ be For schedule of opportunities. the their commercial and call. provided on adopting based a pragmatic the the the whereabouts balance we Further earnings dynamic project, updates will

with business in most We rewarding participants. favorable for a economics environment are now

oil Companies oil robust are we simplicity, a resulting to many These and have matched would between is by Because trading the pushing encountering disruptions have disruptions do We reduces trade markets. conflict rates increased a which the transportation price, evolve. Certainly Russia Ukraine, for margins, routes. productivity in of tanker and freight people beyond dynamics its strong have and a promising all what and outlook. healthier rewarding business. want in an strong of already in fleet refining the general distances, profitable, times we supporting

Russian to distances multiple see transportation be slide, Baltic of could Northwest this for distances, one upwards can XX from Europe. X of times for And see course, from will the that European the X you Asia to compared same to times to when to As XX imports of imports region. exports

the into Some healthy barrels trading has trades will of Iran. despite held ships Venezuela top scrapping the those on from prices. away sanction attract from shadow scrap activity fleets additional This and all vessels

as the the rates in scrapping. return these to As ships unlikely look enter development being course are due markets, we to new that at want market to this compliant

As we or full for years. are three couple increasing shipyard time is and order the there's decrease low at probability fleet the an have the coming of essentially to suggested before, and tanker books

So in to a with and execution model business continue expect our sum, of strategy. us should disciplined you

We and and rates sheet are balance certainly most well liquidity. structured healthy strong outlook. a freight for amongst freight others cyclical supported by The has with strong market markets, a recovered promising

we We with for tuned are set into environment spot recovery significant which in make to profits. exposure are an increasing this

questions. Operator? moment. dividends, that have We as policy with dividend Based on capital. showing we of distributed the record to allocating you in on we income our track with have every for intention be up XXX% open new And quarterly net a solid

[Operator comes the Morkedal Clarksons. Instructions] from Our first of question line from Frode

nice In is past. First on of chart cycle, remember respect the had policy. question tanker I this in I cycle had the dividend the you

You talked depending invest in about where and you when you how you on cycle. the are harvest

on maybe upcycle whatever change when it you is, in policies, of the terms elaborate don't -- could So the you when that ends?

XX% was that has of At the been XX% and since in was brought minimum of XX% leverage this almost our that XX%, policy in down then. Then with sort we or put income place level have it XXXX. ordinary time, in significantly [fiscal],

this we program and that a and right, cost CapEx So no sheets the to going ships introduce as it structure, new dividend felt policy. forward, also timely the have balance reflection, we new for

I happy not certainly our sustainable to policy So, and capital change intention think you these -- and will will should are, have with the structure where be looked something that this short but on intervals. depending things all the at just be is

mind have to this flows. it's like would and that time. in and we net capacity keep continue then we that And So, there difference prolonged a in will income cash thought is for with well to think meaningful through also the

debt So ample desire. to so should do cash potentially and there we ample room to also service is flows then prepayments --

notice guess do a ban time it's terms see How of it's into Second weeks’ the play. over now or the few and a question anything developing? in else? chartering change on have market. you Russian just on you behavior, in the coming Do oils routes you any trades I

where we Far guess, on see so you view areas some we can to some that of, and out but we sent see an shipped to do activity intentions in the observer only East. bring then involving part not I be out list particular, it larger oil the Baltic to be of to the to sort are ships of high-level --

of not and longer sort but only transportation this there mode bit inefficient distances, a is So consuming. of are time

again, of was reducing it the fleet. the So productivity

a really probably and planning days, cards I a is without So in the lot bit early people showing their just it think offices are yet.

will the we going. real So of month, I see activity, end this I think get already some think towards

ISI. comes question Chappell line next Our from Evercore of the Jonathan from

you. for parters tywo Svein,

Colt by the like looks the and next it extended year. Mustang the of into year third So quarter were a

a just Puma you rate, one wondering a question Just market the of if can long-term to since looks rates strength in a year dividend new part time your for is that phenomenal increase give given like time? that, policy? the the the type contracts, contracts And that the prior appetite especially in second like what's sense in charter the for contemplating

the So similarly, business first one one was also year. year, it like. was you what continuation -- this the at that And same rate we that's a the two optional an they contracts, if are have, other extended is basically

first are current the year. we half of enjoyed greatly but these rates of these So charters that year are the of this last time course market, below and course

sort get we're have and they commencements done seen. back the you've of hopefully to the We now tailend and longer or a much taking a ships also, is three we book further want it for and out. already much couple Right of So step big as a see in bit these appreciate to of wanted with rate something periods that.

in will today opportunities closing run. to So these the we think around And see mark. $XX,XXX $XXX,XXX I the at longer of a year market, basically with I the the rates that's think more expect would three freight to you $XX,XXX in current day, be

we the meaningful will while ship market have, But now and on and long So or But we opportunity so. all that. like on a wait this. that, with enjoy the be good to clients spot and it's longer a for they will while build of before right sort exposure we entertain to right we for the spot significant knowledge really right want the would

they're sure undergoing of make earn then said I worth other Does off-hire though they the even scrubber I And to drydocks topic Stallion and still installations. quarters dates, the there's wanted earnings TCE the natural so is no the you understood, operational retrofits? that full just Colt mean time.

No.

So survey. these special scheduled two ships are for the -- first is

survey half and Now, the are they XXXX. were built the in in -- of first dates 'XX those

off-hired case. So any in they will be

going to is this when -- So you're do

off-hire. incremental No

Exactly.

So this to is installation. the scrubber certainly do going

other, almost And first through schedule. the we means then look when to that It to pragmatic have the think seems quarter. we the like

So XQ, XQ manage topic voyages? this next XX of should part schedule little their And to on or these since we them think of like final their to lower XX the like around days trying is, year? then a you're are bit

This depends they are. very And longer. days, are these not you XX you in the stock much to you where voyages as of if on that course, easily market, know, XX fixed

-- whereabouts you ships have on the geographical to to a So favorable want also and you of drydock. sort when go

on I point. this to step, try to good rely you and take can. frankly, limited by commercially do and to be step this as we act -- But So, this beyond have we us need we guidance at that think as will

if for try course, of in books put the reflective that of longer, so. then little it's to current and the for rates, us a while opportunities are spot So, the to important wait

move next stand question. now our to We'll by. on Please

of from Nolan Stifel. Our Benjamin comes the from next question line

excess quick Macalla kind policy I just Rogers Thank just sustainable thank change be real you for a for you allocating Ben. We is insight the wanted of to taking the growth? to the -- should could some you why for was renewal So time. is all mentioned it fleet This maybe policy. wondering on We question. versus or intention if potentially dividend you. little the take at our provide know the had just for new capital on back

asset And time, point, sheet we the robust stated, program, the with our has a no leverage. balance at and a structure its down have we as So brought been that's very same investment very horizon or low ships we for too where to think rates think values date, to they maybe attractive those good. XX-year of buy to of are investments over sort they be We reflection are. require high a

in not sort having want we a will are and price of higher, over be invest that to expectations of XX operate period because slightly the buy months, of a next momentum ships factor with feel-good investors We a time. asset longer ship the might a

bought So, this too set last but is ships the secondhand We reason for were year, more prices, that. buy to quickly. two some we up moved

sheet we about on the at we bought instead and X% But course, as happy did essentially own the of to also we of -- that again, does stock we with you what arise, are balance robust. dividend So, if we us know, bought equal our ships. It spent the was a new have But sort to investment prevent of ships back that company cash as then when making investments discount, access doesn't right so this debt so. our from opportunity well. policy And interested. is not

not course business. sort think that in thought the I and are investing ourselves from also So due to would like through of we in this have precluding

Jefferies. of the from comes line question Omar next Our Nokta from

Svein, couple ones of a Thank for quick you. you. just

about back XXX% dividend. of payout full earnings also that out full looks gains? third gains, the to it how which you'll The do think the Should to other be reflective then items. includes forward? quarter the noncash you portion wanted be paid policy, here forward going going and first think losses? like and the just payout is the gains $X.XX, clear, any we So back that you've for And earnings Just going pay to on of off hold but of cash the

benefit including extraordinary benefit right. the past, shareholders So in of cash in and noncash the P&L a gains, losses, cash not also gains let way we've the the of in have

clearly as any So we about without stated, caveats. income think net

discharge -- to low difference wide you the then And the just XX,XXX treatment, a relative also question gotten discharge you've you’ve You on again, maybe discharge. got maybe in past of accounting sorry this versus and the in the in could just got – discharge explain reported? in on of then just XX,XXX because but discharge difference you terms of terms what with

affects you Just how want earnings reminding wouldn't what sense, to differences over and that a get the if us your are just mind time?

course, of answer that. I Yeah, can

So previous the revenue revenue used meaning on discharge we previous discharge, that voyage. we to counting, the the included from

do to it's new anymore, but discharge is not need from vessel included what XX, revenue that that the books. policy Now revenue to -- the we last until there the IFRS voyage our according new from loaded, is the no revenue and in has is

reflected same but course, period much the So voyage it less it's the a total of of is for time. on revenue

time, but over Does between you'll have variances -- out maybe that smooth as mean wide figures effectively? basically they do both that

time. over definitely out smooth They

revenue So in rates, a then that and so And with same will way different you'll in clearly and course, of to next have discharge. load volatile on period, gain will more to have revenue in increasing reported from it's again quarter. the it's freight you postpone exactly but the a then market the you

you. Thank turn I'll it over. Okay.

Omar, our in is, At In as discharge areas. level discharge, making regard company, right? ships, just commercial do focus a ships different treatment with right? the when when accounting shipping is, the the to we trade few in the is we made money way this is calls it what what to on I’ve got things on evaluation, the which

comes Webber Our Chris line next Research. of Tsung from question the from

fleet. you Suez see curious Just Do or on some thoughts shadow well? VLCCs your Afras as you mostly for expect demand involves or on this it's do

it the think, I board. will be across

will of these sanctioned. some trades course, not of So be

think some a it's will problem. really not sanction I So are Afra/Suez then there be But there a mixture. it's trades. whether And

So actually many a which or on to have how view it's hard size.

it's spot know be should way, put more from are like planning charters do your with Now, last still quarter. Osprey year guys believe, the get some face these will plan that one you you time for a second to another company many to the mostly does or I you or five exposure? I How Puma, the charter keep

have We both, in importantly, it on depends but on nominal the are where depends it we like to money. And cycle. the

So we fixed develop additional step where year. higher than they the due this will were income earlier be will to for to and we back take we in a try course now, want but rates

so call, are I $XX,XXX mentioned year on in that of on the minus plus sort forth. the earlier, position territory and depending three the the of as rates type and ship the So believe we

it, academically portion to So, thinking very rewarding fleet rate. about underscore due a bit a very of the then rates. a of is rewarding course, fix meaningful in sort it possible And I

if of course, not Of to you some also to a abilities you relation be the think our create merit. But But might case. most bit case. have It that can be earnings that, yes, and it. will to visibility it's on hard our to say the will the have make I trying and that trust the dividend in policy commercial

Right.

your some Of course, CI give the within one definitely CI, the regulations. towards just stability one and final upcoming sort it's it. dividend about context just to of just of trying policy, And

having falls wondering responsibility starting just Just out XXXX the on what the five onto like of vessel January the 'XX? you for the curious years, going ships and with two there owner charter or

calculation design. the the based is EEXI vessels’ abilities So and a on

they have the EXI whatsoever these ships CII So, ships eco and many to no come. with on years for are issues

the sort by bit very fleet closing XXXX on the how and or time if oldest that clear I which sort in entire it a regulations, we are a for chance, little course on like the it's have fleet, the view leg next the you demographics So, about, And is and will the of of retirement. DHT so in have DHT’s calculations develop. of of done comes that sort up in the is ships restrictions our of when

to sort don't initial in the as own taking a their on impairment securing course, really such. of the charter, transportation like, what So see levels for view if will you we sort any that need have want DHT on But time of of for customer commercial services. ship to book they considering is they

will that our also manage all to make to ship owners and it's calculation report it's have So and responsibility this. this

line the Our next of question comes Karlsen Kepler with Cheuvreux. Anders from

is do away, forward? very put market factors be into developments to looking but consider promising market deal the main The going to what you the risk

are course, economic some how are, the there of efforts inflation banks growth. central out gloves macroeconomic and and that There also doing to that general that then will stall and impact

demand of course, for get do and will if of consumption. hard into the And world demand economy we course the one, recession transportation. again, for a that impact So, certainly oil oil and

But ago entering that down many more that's since think -- time of structuring look you've issue. positive we into there's think industry I so you sort big long insulated, seen I to of market sort are now. the the elements in the if

a very negative events all-in-all, think would that looks sort I So macroeconomic and big good, of barring correction. the pose that

next of Our ahead go company name. comes Sherman. question line announcing Rick your Please from the

got Sherman, for question Yeah. for ship Thanks Hi, about quick the a Rick taking million. my question. Private $XX Investor. just the of I sale

On basically paid in the $XX.X off derive ship? $X.X cost equity for that and is on the you thing million the that How profit, $X.X debt million mathematics million. with carrying million on did $XX of a you're million profit you because where $XX.X net

the So value is balance the in book ship. the the and the profit between the proceeds net of P&L

-- appreciated didn’t acquired the and instance. a bit in has So this XXXX was ship

this back you. to further at so time, questions There the are no I'll conference hand

DHT. Have Thank good a for day. much That's following you all very appreciated. Bye-bye. to

This you participating. concludes Thank conference today's for call.

disconnect. now may Speakers standby. please You