KCC: Third Quarter 2024 – Strong financials amid more challenging markets

30 Oct 2024 07:00 CET

Oslo, 30 October 2024: Klaveness Combination Carriers (“KCC”) reports continued
strong operational and financial performance and maintains dividend
distributions of USD 0.30 per share in line with last quarter. TCE earnings for
the KCC fleet outperformed both the dry bulk and product tanker markets in Q3,
demonstrating the value of the combination carrier concept.

CEO Engebret Dahm commented: “KCC delivered strong results in the quarter amid
more challenging markets with substantially weaker product tanker markets. Our
CLEANBU vessels returned to more efficient combination trading, positively
impacting earnings and emission performance, and both segments outperformed the
standard dry bulk and product tanker markets.”

KCC owns and operates 16 combination carriers built for the transportation of
both wet and dry bulk cargoes. The vessels are operated in trades where they
efficiently combine dry and wet cargoes with minimum ballast, capitalizing on
imbalances in trade flows.

“With expected lower rate differentials between dry bulk and tanker vessels
going forward, we expect our combination carriers to demonstrate superior value
creation. In such market circumstances the higher efficiency of our combination
carriers is set to deliver premium earnings to standard vessels supporting
continued strong financial performance and dividend distribution to our
shareholders,” Dahm continued.

Highlights for Third Quarter 2024:
- Q3 2024 EBITDA of USD 32.6 million (Q2 2024: USD 36.2 million) and EBT of USD
21.7 million (Q2 2024: USD 25.1 million)
- Both KCC’s segments outperformed the standard dry bulk and product tanker
markets in the quarter
- Quite stable CLEANBU TCE earnings Q-o-Q of $38,673/day (Q2 2024: $39,093/day),
despite significantly weaker spot markets
- CABU TCE earnings of $29,668/day (Q2 2024: $37,656/day) impacted by a weaker
MR-tanker market and temporary lower caustic soda volume
- Record low carbon intensity (EEOI 6.1) driven by limited ballasting and high
cargo intake (Q2 2024: 6.9)
- Q3 dividend of USD 0.30 per share amounting to USD 18.1 million in total (Q2
2024: USD 0.30 per share), marking the 24th consecutive quarterly dividend
distribution

Fleet average TCE earnings for the quarter of $34,052/day [1] (Q2 2024:
$38,376/day [1]) were mainly the result of lower CABU TCE earnings compared to
last quarter, however the fleet outperformed both the dry bulk and tanker
markets. The CABU segment delivered average TCE earnings of $29,668/day [1] for
the quarter (Q2 2024: $37,656/day) impacted by a weaker MR product tanker market
and temporarily lower caustic soda volume in the period. The CLEANBU TCE
earnings remained quite stable Q-o-Q and ended at $38,673/day [1] (Q2 2024:
39,093/day), despite a significantly weaker LR1 product tanker market. The
strong CLEANBU performance was backed by improved trading efficiency and limited
ballasting.

The Board of Directors declared a quarterly dividend distribution of USD 0.30
per share (Q2 2024: USD 0.30 per share) amounting to USD 18.1 million and equal
to 92% of the adjusted cash flow to equity, well above the minimum dividend
policy of 80% [2].

The carbon intensity (EEOI) of the KCC fleet improved significantly to reach
6.1, the lowest level ever achieved for a quarter. This was supported by a 19%
Q-o-Q drop in CLEANBU EEOI, positively impacted by improved vessel utilization
following increased combination trading. EEOI for the CABU fleet was stable at
6.3, around the same range as the previous four quarters.

TCE earnings guidance [3] for Q4 2024 is $28,000-29,000/day for the CABUs and
$31,000-33,000/day for the CLEANBUs, somewhat down compared to Q3 mainly due to
weaker product tanker markets to date in Q4 offsetting positive effects of more
efficient combination trading.

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[1] TCE earnings $/day are alternative performance measures (APMs) which are
defined and reconciled in the excel sheet “APM3Q2024” published on the Company’s
homepage Investor Relations/Reports and Presentations under the section for the
Q3 2024 report. The address to the Company’s homepage is
www.combinationcarriers.com.
[2] EBITDA, less maintenance CAPEX, less debt service (see slide 40 in the Third
Quarter 2024 Presentation)
[3] Estimate based on booked cargoes and expected employment for open capacity
basis forward freight pricing (FFA).

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Invitation to presentation of Q3 2024 financial results
In connection with the release of financial results for the Third Quarter 2024,
Klaveness Combination Carriers ASA (“KCC”) will hold a webcast presentation at
09:00 CET on Wednesday 30 October.
To follow the webcast live go to www.combinationcarriers.com/investor-relations
or copy and paste the following link to your browser:
https://www.combinationcarriers.com/kcc-q3-2024-financial-results.
Questions for the Q&A session can be submitted in writing through the webcast
solution during the presentation.

About Klaveness Combination Carriers ASA
KCC is the world leader in combination carriers, owning and operating eight CABU
and eight CLEANBU combination carriers with three CABU vessels under
construction for delivery in 2026. KCC’s combination carriers are built for
transportation of both wet and dry bulk cargoes, being operated in trades where
the vessels efficiently combine dry and wet cargoes with minimum ballast.
Through their high utilization and efficiency, the vessels emit up to 40% less
CO2 per transported ton compared to standard tanker and dry bulk vessels in
current and targeted combination trading patterns.

For further queries, please contact:
Engebret Dahm, CEO
Telephone: +47 957 46 851
Liv Dyrnes, CFO
Telephone: +47 976 60 561

More information:
Access the news on Oslo Bors NewsWeb site

630674_KCC Q3 2024 Presentation.pdf
630674_KCC Q3 2024 Report.pdf