Belships ASA : Report 1st quarter 2018


·             Operating income of USD 8.2 m (Q4: USD 7.6 m)
·             EBITDA of USD 3.3 m (USD 3.7 m)
·             Impairment reversal of USD 1.3 m (USD 2.0 m)
·             Net result of USD 2.1 m (USD 3.2 m)
·             M/S Belnippon delivered from Imabari Shipbuilding 24th January
·             All ships operating normally – modern fleet – average age 4.5 years
·             Contract coverage 100% for delivered ships – around USD 45 million fixed charter
·             Financial advisor appointed to evaluate strategic alternatives
·             Dividend proposal of NOK 0.10 per share


1st quarter 2018 results

Belships operating income in 1st quarter 2018 was USD 8.2 million (Q4: USD 7.6 million), while EBITDA amounted to USD 3.3 million (USD 3.7 million). The Group’s operating result amounted to USD 3.1 million (USD 4.6 million), while net result for 1st quarter 2018 was USD 2.1 million (USD 3.2 million). The figures for 1st quarter includes impairment reversal of USD 1.3 million. Impairment reversal in 4th quarter 2017 amounted to USD 2.0 million.

The Board proposes a dividend of NOK 0.10 per share for 2017.


Fleet status

Belships concentrates on the dry bulk market, with 6 modern Supramax/Ultramax in service.

M/S Belstar, M/S Belnor and M/S Belisland have continued the long-term contracts to Canpotex of Canada. Canpotex is one of the world’s largest exporters of potash, a fertilizer product imported in large volumes by countries such as China, India and Brazil. M/S Belforest and M/S Belocean are both on time charter to Cargill, and will be open around October-November. M/S Belnippon, which was delivered from Imabari Shipbuilding in January, is on time charter to Cargill for 10-13 months. All ships have sailed without significant off-hire. Technical management is handled by Belships Management (Singapore), with a total fleet of 11 ships under technical management.


Newbuilding program

Belships’ remaining newbuilding program with Imabari Shipbuilding in Japan consists of one 63 000 dwt eco-design Ultramax bulk carrier on a long-term T/C-in agreement incl. purchase option for delivery within first half 2020.


Financial and corporate matters

As per 31 March the Group’s cash totaled USD 5.4 million, compared to USD 5.5 million as per 31 December 2017.

The mortgage debt as per 31 March was USD 27.0 million. Net lease obligation as at 31 March was USD 42.3 million. In addition Belships has a long-term loan facility of SGD 2 million, secured by the lease agreement for our Singapore office. Net lease obligation and mortgage debt were reduced by USD 1.8 million in the 1st quarter.

M/S Belnippon is considered as operational lease.

Hedging the Group’s interest exposure on bank loan is considered on an ongoing basis. The hedging level of interest rate exposure is currently around 60%.

At the end of the 1st quarter of 2018, the book value per share amounted to NOK 4.74 (USD 0.61), while the equity ratio was 28.0%. Added value related to the long-term charter party for M/S Belisland is not reflected in the balance sheet.


Market highlights

The Capesize-index ended the 1st quarter at USD 8 339 per day, whereas the Panamax-index ended at USD 12 011 per day. The Supramax-index ended the quarter at USD 12 023 per day. As per today the Cape index stands at USD 13 665 per day, Panamax-index at USD 10 485 per day and Supramax-index at USD 11 312 per day. Baltic S&P Assessment’s valuation of a 5-year old Supramax is currently USD 18.0 million. 



The replacement in China of domestic produced iron ore with imports is expected to continue in 2018, but the first quarter imports are almost flat y/y at 271 million tons. A contributing factor is flooding in Brazil, which has hampered export of iron ore to China. This has certainly put pressure on the rates for Capesize, whereas lower imports of coal to China have affected the freight rates for Panamax and Kamsarmax. However, the agriculture export from Brazil/ Argentina has been strong y/y, which is benefitting the Supramax/Ultramax fleet.

The talks of tariffs between USA and China have been impacting the dry bulk sentiment, but the trade of soybeans from US to China constitutes only 0.6% of the total dry bulk trade.

The supply is expected to increase by a modest 1-2% p.a. in 2018-19, whereas the demand is expected to increase by 3-4% p.a. If so, we should see an improvement in ship values and charter rates.

Belships’ vessels are fully covered until October 2018 when M/S Belocean becomes open, followed by M/S Belforest in November and M/S Belnippon in January 2019. The company is well positioned for a dry bulk market that we believe will strengthen. 

Belships’ vessels are chartered out on fixed rates to reputable counterparts, representing a future nominal gross hire of around USD 45 million.

Focus remains on developing Belships as an owner and operator of modern bulk carriers chartered to reputable counterparts, building a portfolio of quality ships and robust charter parties that will generate distributable cash flows.

The Company’s largest shareholder, Sonata AS, has informed the Board of Directors, that it is reviewing its long-term ownership. The Company has in consultation with Sonata AS, appointed ABG Sundal Collier as financial advisor, to evaluate strategic alternatives. This strategic review has been initiated and is progressing well.


Oslo, 24 April 2018



CEO Ulrich Müller
Phone no. +47 22 52 76 15


This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.