Welcome to 2020 Bulkers Q1 2025 quarterly report. For the first part of this call, all participants are in a listen-only mode. Afterwards, there will be a question-and-answer session. To ask a question, please press 5-star on your telephone keypad. This call is being recorded, and I will now hand it over to your speakers. Please begin.
Thank you, Operator. Welcome to the Q1 2025 conference call for 2020 Bulkers. My name is Lars-Christian Svensen, and I will be joined here today by our CFO, Vidar Hasund. Before we start the presentation, I would like to remind you that we will be discussing matters that are forward-looking. These assumptions reflect the company's current views regarding future events and are subject to risks and uncertainties. Actual results may differ materially from those anticipated. With that squared away, I will now continue with the highlights of the quarter. We reported a net profit of $0.2 million and earnings per share of $0.01, and achieved time charter equivalent earnings of approximately $19,000 per day gross. Total dividends and cash distributions for the quarter totaled $0.10 per share for the months of January to March.
During this period, we have also completed dry docks for Bulk Shanghai and Bulk Sydney at a total cost of $2.3 million. In subsequent events, we achieved a time charter equivalent for April 2025 of approximately $27,100 per day gross. Today, we also declared a dividend of $0.10 per share for the month of April. Our dry dock program has almost come to an end, and we have completed the docking for Bulk Sao Paulo at a cost of $1.2 million. Last but not least, we have realized the gain on forward freight agreements of $1.4 million for the second quarter of 2025. With that, I will now pass the word back to Vidar.
Thank you, Lars-Christian. 2020 Bulkers reports a net profit of $0.2 million for the first quarter of 2025. Operating profit was $2 million, and EBITDA was $4.3 million for the quarter. Earnings per share were $0.01. Operating revenues and other income were $9.5 million for the first quarter. The average time charter equivalent rate was approximately $19,000 per day gross. Vessel operating expenses were $3.8 million, and the average operating expenses per ship per day were approximately $7,000 in the first quarter. G&A for the first quarter was $0.9 million. 2020 Bulkers recognized approximately $0.3 million in management fee for the first quarter as operating income in the financial statements. Net financial expenses were $1.8 million, which primarily consists of interest expense. Shareholders' equity was $150.1 million at the end of the quarter.
Interest-bearing debt was $112.5 million at the end of the first quarter and is non-amortizing until maturity in April 2029. Cash flow from operations was $3 million for the first quarter, net of $2.5 million paid for dry docking. Cash and cash equivalents were $16.8 million at the end of the quarter. The company declared total dividends and cash distributions to shareholders of $0.10 per share for the months of January, February, and March 2025. That completes the financial section, and now back to you, Lars-Christian.
Thank you, Vidar. Before I will guide you through the market section, we would again like to highlight our competitive cash break-even. Our industry-loved cash break-even is the result of competitive G&A and low and attractive debt. We break even at $11,500 per day, which means we only need an average Cape Size index of around $7,500 per day to make a profit. This is possible due to our high-performing assets, which burn less and more efficient fuel and have a higher cargo intake than a standard Cape Size vessel. This also means that we can adopt an opportunistic approach to trading, allowing us to avoid taking contract coverage in weaker markets at levels we consider unattractive. We are proud to continue with our monthly dividend policy, equal to our free cash flow, which now shows 59 consecutive monthly dividend payments.
This slide shows the theoretical dividend capacity based on various rate scenarios for a standard cape size vessel. If we were to lock in the remaining of the year at fixed rates using the current FFA curve, it would produce an annual runway dividend capacity of about NOK 15 per share, or around 13% yield on today's share price. Now, let's move over to the market section. After a disappointing end to 2024 with decreasing ton-miles and subsequent lower freight rates, Q1 2025 has managed well, settling at $13,000 per day on the Baltic cape size index. The largest contributor to this has been the rock-solid bauxite volumes, which we will circle back to later in the presentation. As I mentioned, ton-miles have improved from the lows of Q4 2024, much thanks to the seemingly ever-increasing bauxite volumes from West Africa.
Bauxite ton-miles grew 43% year over year, and around 85% of the commodity were destined for China. Brazilian iron ore volumes and ton-miles also experienced growth, despite Brazil going through a hefty wet season, achieving a 3% year-over-year growth. The Australian iron ore exports, however, were hampered by two large cyclones, thus had a year-over-year decline of 10% in the first quarter. Global coal ton-miles also underperformed and had a 30% contraction year over year due to over 50% less exports from Colombia and less coal than usual transported on Cape Size. Please be reminded, though, that Q1 2024 was an exceptionally good period in terms of cargo volumes and ton-miles, so looking at the first quarters of 2025 in historical terms, it has proven decent. Comparing Q4 2024 in ton-miles with Q1 2025, we also see a solid improvement of 2.5% overall increase.
In Q4 2024, we observed that vast coal volumes were shifted from cape size vessels to Panamaxes due to a weaker agricultural season, which resulted in plenty of Panamax capacity being available. However, as illustrated at the far right in this slide, more coal has now returned to cape size vessels, with less being transported on Panamaxes. We believe this shift is linked to more agricultural ton-mile intensive trades from the East Coast of South America to China, making cape size vessels more competitive in the coal space. While we still have some catching up to do to reach the heights of cape size coal trades seen in the first half of 2024, we welcome the increasing coal volumes back to the merchant cape size fleet. Let's have a look at the world steel production. Contrary to media impression, the Chinese steel production remained positive.
China has increased their production so far in 2025 with 1% year-over-year, and compared to Q4 2024, the country has increased production with around 10% as per historical seasonal development. The Chinese steel production is estimated to remain flat for the next two years. The rest of the world has had a flat steel production year-over-year and are up 6% comparing to Q4 2024. Forecasts for 2025 and 2026 indicate an increase of 3.5% and 4% respectively. Pre-COVID levels are projected to be reached in 2027. We have discussed the bauxite trade extensively and the staggering volume growth we observe every quarter. As a central component in the aluminum industry, China uses these imported tons, especially in the electric vehicle production. Imports are increasing, and the Chinese bauxite stockpiles are declining, which indicates room for further growth.
Please note from the slide that the seaborne trade of this commodity has almost tripled in 10 years. Best of all, the majority of the volumes are being shipped on Cape Size and Newcastlemax vessels. It's not only bauxite that can contribute to the ton-mile Newcastlemax story. The first volumes of iron ore from the Simandou mine in Guinea are expected to be exported in Q4 2025, according to the latest updates. Over a 24-month ramp-up phase, the mine is targeting 120 million tons of high-grade iron ore per annum to the market. With the additional Vale capacity increased by 2026, we expect a total of 170 million tons of high-grade iron ore from the Atlantic, most of which will be exported to China. These volumes alone will require 160% of the total order book.
As a reminder, it's not demand that historically creates setbacks in shipping, but rather the oversupply of vessels. At this stage in the cycle, we have clear visibility of supply for the next three to four years. The order book is at a record low, standing at 7.9% of the total existing Cape Size fleet, and active shipyards are still 50% down from the peak of 2008, making it very challenging to build any large fleet capacity that could distort the favorable vessel supply dynamics over the next few years. We have observed firsthand the dry dock challenge with some of our own vessels this year and can confirm that the dry dock rally has officially begun. We continue to see a significant increase in dry docks due to mandatory special service required on merchant vessels every five years.
Vessels delivered in 2010 account for 10% of the total Cape Size fleet and will need to undergo their 15-year special survey in 2025. Additionally, there will be 5 and 10-year special surveys, meaning around 23% of the total Cape Size or Newcastlemax fleet will be competing for dry dock space this year, with similar numbers expected for 2026. We estimate a total of 1.3-1.4% additional off-hire on the total fleet due to dry docks alone in 2025 and 2026, not factoring in potential congestion and waiting time. Thank you, and with that, I will pass the word back to the Operator, and we welcome any questions you might have.
Thank you. If you do wish to ask a question, please press five-star on your telephone keypad. To withdraw your question again, you may do so by pressing five-star again. We will have a brief pause while questions are being registered. The first question is from the line of Bendik Nyttingnes from Clarksons Securities. Please go ahead. Your line will now be unmuted.
Thank you. Hello, Lars. You did a pretty good trade in the FFA market this quarter. Can you sort of tell us how you or what made you pull the trigger, both when you locked in rates, but also when you decided to hedge against that in the FFA market later on?
Yeah, hi there. I think it was several factors leading into that. We saw short-term that there might be some weakness, and not so much because we did not believe in the dry bulk market, but this was in the middle of very uncertain geopolitical tensions, especially related to the new U.S. president coming out with tolls and tariffs regulations. It was a shaky time, and we saw that the equities were really forceful and impactful on the FFA market during that time. We decided to take some cover on the fleet, and when it looked oversold, we decided to buy it back. There is no rocket science behind that one, but it was a clear trend, which I am very happy that we got right this time around.
Yeah, it was making a nice contribution to good dividends. Also, I wanted to touch on the dry docking. From what I'm reading from your report, we're looking at an increase in dry docking times of around 70%-80%. Have you seen, as we've had three vessels now and are expecting another one, have you seen any change recently in how long it takes and potential read-throughs to the market in general?
We see this as a challenge, which we flagged already late last year for the entire fleet. We also experienced for the first time that we see several vessels being double banked, triple banked, waiting to go into the dry dock. There is no doubt that this is going to be challenging going forward and also for the remainder of the year to make this fleet, the world fleet, docked in time. When it comes to our last vessels, we have taken some steps there to make sure that we do not have too many delays, and hopefully that should be better than the previous ones we had.
Yes, we'll return to the Q.
Thank you.
Let me remind you, if you do wish to ask a question, please press five-star on your telephone keypad. As there are no further questions in line from the telephone, I will hand it back to the speakers. Please go ahead.
Thank you very much for listening in, and we'll speak again the next quarter. Take care.