Earnings Call: H1 2025

Aug 21, 2025

Torbjørn Gjervik

CEO, Western Bulk

Okay, we start. Good afternoon and welcome to Western Bulk's First Half 2025 Investor Presentation. My name is Torbjørn Gjervik, CEO of Western Bulk, and I'm joined today by our CFO, Kenneth Thu. In this session, we'll take you through the market environment for the first half, highlights of our results, our market view, and some words on how we will improve our margins going forward. After the presentation, we'll open up for questions. Let's get started. Here's our disclaimer. As many of you would know, our business model as an asset-light operator centers around matching cargoes and vessels. We create value for our customers by delivering optimized transportation solutions, while we're also managing their freight-related risks. The physical market had a weak start in 2025 before bouncing back somewhat after China's New Year, which is very seasonally normal. From there until mid-June, the market was, I would say, dead without much pulse, hovering around $10,000 a day for Supras. The same lack of volatility, as you can see on the middle chart, was seen in the FFA markets, which provided limited opportunities there as well. The basis spread between the Pacific and Atlantic was trading within the normal range, I would say. We achieved a net TC of $7.6 million. Not too happy with that. A loss after tax of $2.1 million, very much due to a very weak Q1, where we had period vessels fixed at higher rates from 2024. Most of these vessels were redelivered in that quarter. Q2 was much better. We saw an increased performance in a market that was actually quite low. We had a short position both with cargoes and with FFAs and managed to capture and do a pretty decent Q2. During that quarter, we also sold or flipped two purchase options, generating $3.1 million in net TC. Administrative expenses came in below $10 million, which is something we are satisfied with. A reduction of $3 million from the same period last year, and well within the target of $22 million for the full year. Vessels, 110 vessels, and as you have seen and as previously stated in the press release, $383 net TC margin per day. A strong cash position still, with an available liquidity of $64 million and a book equity of close to $48 million. Our market view, the market has increased significantly over the summer, which seemed to have catched most participants off guard. This has also lifted expectations for the remainder of the year and further out on the forward curves. Western Bulk, I can say, has been well positioned for this Q3 push. That being said, we remain cautious for Q4, mainly due to the tensions between the U.S. and China, particularly when it comes to whether China will buy soybeans from the U.S. or not. We see some significant sort of dark clouds to keep monitoring closely in Q4. Going further out into next year, we are more positive on the back of an expected mineral push, a rush of cargoes out of Guinea, which we believe will be really positive for the larger vessels, and that some of that positiveness will filter through to the Capesize axis and the Ultramax axis. If we go further, I think it's also important to share with our investors how we are going to improve our markets further into the future. We obviously have an ambition of becoming the best at what we do, dry bulk operating, and we want to be the best in the industry. In order to get to that level, we will maintain the same focus as we talked about in a previous investor presentation. It takes time to get there, but we need to maintain the same focus on our people. I'm talking about maintaining the best people. Way too many good people have over the years left the company. We need to maintain them, and we have concrete plans and actions in motion for how to do that. We need to train them, continue to do that. We've been a training ground for many other companies over the years. We need to also look externally to recruit complementary skills from the markets and from our competitors even to grow profitably. It's also extremely important to maintain the momentum we have internally on performance culture and winning mentality. We also have concrete actions and plans for this, and we work on it every day with the team leaders and with everybody in the organization. We are a company that is truly believing in, and we are using data to help support trading decisions. The data is improving month by month, and we are using the data, and we are getting better data. These are the three focus areas that we will continue to focus on for the coming six months as well. We are confident that over time, this is what's going to take the company in the right direction, improve our margins so that we can get back into territory of paying out dividends to our investors again. That was the last slide. It is time to open up for questions if anybody has some. Okay. If no questions, then I wish everybody a wonderful day and see you next time.