Stainless Tankers ASA

Earnings Release • Aug 7, 2024

2Q24 Results Presentation

07 August 2024

DISCLAIMER AND FORWARD-LOOKING STATEMENTS

The preparation of interim financial statements requires Stainless Tankers ASA's (the "Company", "we" or "our") management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

This presentation includes forward-looking statements which are based on management's current expectations and projections about future events. All statements other than statements of historical facts included herein, including statements regarding our future financial position, market outlook and future economic projections and assumptions and risks and uncertainties related to our business, strategy, capital expenditures, projected costs and our plans and objectives for future operations, may be deemed to be forward-looking statements. Words such as "believe", "expect", "anticipate", "may", "assume", "plan", "intend", "will", "should","estimate", "risk" and similar expressions or the negatives of these expressions are intended to identify forward-looking statements.

By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forwardlooking statements are not guarantees of future performance. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements and readers of this presentation should not place undue reliance on these forward-looking statements. For additional information on risk factors related to the Company and its business, reference is made to our information document dated 27 April 2023.

Although management believes that the expectations reflected in the forward-looking statements are reasonable, we cannot assure that our future results, level of activity, performance or achievements will meet these expectations. Moreover, neither we nor any other persons assume responsibility for the accuracy and completeness of the forward-looking statements. Any forward-looking statement speaks only as of the date which such statement is made, and we undertake no obligation to update any of these statements after the date of this presentation.

Highlights

Chemical Tanker Rates & Outlook

Financial Review

Q&A

Appendix - 2Q 2024 Financial Statements

Highlights

	2Q24 NAV currently estimated at \$7.59 per share (NOK 83.55) after cumulative dividend paid of \$0.76 per share
NAV performance	(NOK 8.37). NAV Total Return since inception including dividends is 71%
	EBITDA of \$9.5m and net income of \$4.5m on net revenue of \$17.1m, earnings driven by the strong 2Q24 pool
2Q24 Results	TCE at \$23.8k per day
 Firming Market Rates	2Q24 pool TCE at \$23.8k per day but weakened slightly towards the end of 2Q24 and July due to seasonality. Continue to expect a strong market in the medium term supported by a limited orderbook relative to an ageing fleet
 Low Capacity Growth	Annual fleet growth of approximately ~2.5% over next two years compared to projected demand growth of ~3%
	The Company declared a \$3.71m dividend1, \$0.275/share (c. NOK 3/share), an annualised yield of 22%
2Q24 Dividend	on invested equity, payable on or about August 15th
 2024 Outlook	We remain very positive and expect earnings and dividends to remain stable in coming quarters

1. STST will make dividend distributions in the form of return of paid-in-capital

NAV performance since inception

Since inception, NAV/share increased to \$7.59/share on market value after cumulative dividend paid of \$0.76/ share or \$10.26m

NAV Total Return* of c.71% since inception and 19.1% in 2Q24

* NAV Total Return calculated on a per share basis since IPO assuming dividends reinvested

Seasonal pause after a strong quarter

• 2Q24 net pool TCE of \$23.8k/day, well ahead of budget (\$21k/day) as the market strengthened
• Net pool TCEs firmed to \$24.5k/day in May and slightly weakened after due to seasonality, with July at c.\$23k/day and c.82% coverage for August at c.\$22.3k/day
• As of May 2024*, strong support from pool COA book continues, with 30% of rolling 12 months capacity fixed at TCEs of c.\$23k/day
• Pool utilisation has increased to 98.8% in 1H24 compared to 97.2% in 1H23
• 1-yr market time charter rates increased to \$22.25k/day in May and remained flat in June and July

Disruptions in key transit points easing slowly

Source: Tufton TRACS data, Clarksons SIN

Limited fleet growth supports positive outlook

• The orderbook rose to c.8% of global fleet with 9 newbuild stainless steel tanker orders since March
• Scheduled deliveries for the 10-25k DWT segment during 2024-26E period rose to 50 (43 last quarter)
• Projected removals unchanged with vessel age and backlog of scrapping candidates growing
• Annual fleet growth of approximately ~2.5% in 2025/26 compared to projected demand growth ~3%

	Select Financials	2Q24	1Q24
	Calendar days	819	819
	Available ship days	819	819
	Vessel days under ownership %	100.0%	100.0%
	Revenue ship days	748	794
	Utilization %	91.3%	97.0%
	Net pool TCE (\$/day)	23,831	20,615
	Net time charter (\$/day)	15,250	15,250
	(+) Net revenue	17,061	15,291
0) 0 0	(-) Opex	(6,239)	(6,442)
n \$'	(-) SG&A	(1,304)	(711)
(i	(=) EBITDA	9,519	8,137
nt e	(-) Depreciation	(2,877)	(3,020)
m e	(+/-) Financial income/(expense)	(2,090)	(2,112)
at	(+/-) Other income/(expense)	(12)	(8)
st	Net Income	4,540	2,997
	Cash and cash equivalents (1)	2,334	2,337
0)	Fleet book value (2)	138,835	139,721
0 0	Fleet market value (3)	174,040	162,480
n \$' (i	Net outstanding loan balance (4)	79,129	81,694
	value % (5) Net loan outstanding to market	45.5%	50.3%

Comments and notes

• Q2 revenue of \$17.1m, a 12% increase compared to Q1, driven by the higher pool earnings as the market strengthened
• Utilization at 91%, lower by 6% compared to Q1, mainly due to the drydocking of Orchid Madeira and Orchid Sylt
• Orchid Madeira and Orchid Sylt completed their third special survey on April 14th at a cost of \$1.3m and on May 14th at a cost of \$1.23m, respectively
• Eight vessels trading in the Womar pool, with the one remaining time-chartered vessel joining the pool on May 6th
• Net income of \$4.5m, up 52% from \$3.0m in Q1
• Fleet market value up strongly at \$174.04m; NAV at \$102.5m or \$7.59/share (c. NOK 83.55/share)
• LTV based on increased fleet value falling to 45.5%

• Dividend of \$3.71m, or \$0.275/share (c. NOK 3.0/share), to be paid on or about August 15th

• 1) Excluding all restricted cash balances

• 1. 2) Net book fleet value based on fleet value at purchase net of accumulated depreciation
• 1. 3) Based on the valuations obtained by VesselsValue as at 30th June
• 1. 4) Net outstanding loan balance comprise of loan balance outstanding not including capitalised costs LESS minimum liquidity requirement

• 5) LTV % is based on net outstanding loan balance LESS restricted cash per vessel DIVIDED by fleet market value as per the facility agreement

Fleet stats

Condensed income

Select balance

sheet items

Appendix - Financial statements (Income Statement)

Consolidated statement of income statement and other comprehensive income (unaudited)
---------------------------------------------------------------------------------------	--	--

In USD	Q2 2024 (unaudited)	Q2 2023 (unaudited)	H1 2024 (unaudited)	H1 2023 (unaudited)
Operating revenue	17,994,471	7,019,155	33,999,264	7,019,155
Vessel voyage expenses	(932,995)		(415,696) (1,646,940)	(415,696)
Vessel operating expenses	(6,238,683)	(2,654,578)	(12,681,132)	(2,654,578)
Administrative expenses	(1,315,657)		(552,129) (2,034,882)	(687,152)
Other income	-	10,098	404	10,098
EBITDA	9,507,137	3,406,849	17,636,716	3,271,826
Depreciation and amoritsation	(2,877,260)		(1,238,417) (5,897,539)	(1,238,417)
Operating result (EBIT)	6,629,877	2,168,432	11,739,176	2,033,409
Financial income	53,881	120,024	109,895	134,670
Financial expenses	(2,134,840)		(1,094,674) (4,294,883)	(1,094,674)
Profit before tax (EBT)	4,548,918	1,193,783	7,554,189	1,073,405
Taxes	(8,535)	(12,548)	(17,069)	(12,548)
Profit and other comprehensive income for the period	4,540,383	1,181,235	7,537,120	1,060,857
Attributable to:
Equity holders of the parent company	4,540,383	1,181,235	7,537,120	1,060,857
Non-controlling interests	-	-	-	-
	4,540,383	1,181,235	7,537,120	1,060,857

Appendix - Financial statements (Balance Sheet)

Consolidated statement of financial position (unaudited)

In USD	30 Jun 2024	31 Dec 2023
	(unaudited)	(audited)
ASSETS
Non-current assets
Vessels and drydocking costs	138,835,296	142,079,020
Total non-current assets	138,835,296	142,079,020
Current assets
Trade and other receivables	9,411,288	9,248,236
Accrued income	241,758	-
Cash and cash equivalent	2,334,489	2,345,378
Total current assets	11,987,535	11,593,614
Total assets	150,822,831	153,672,634
EQUITY AND LIABILITIES
Equity
Share capital	13,072,672	13,072,672
Share premium	40,488,547	46,901,047
Retained earnings	13,688,185	6,151,065
Total equity	67,249,403	66,124,784
Non-current liabilities
Interest-bearing debt - non-current	69,977,163	74,913,770
Total non-current liabilities	69,977,163	74,913,770
Current liabilities
Interest-bearing debt - current	9,656,247	9,736,506
Trade and other payables	3,888,812	2,381,465
Accrued taxation	51,206	34,137
Deferred income	-	481,973
Total current liabilities	13,596,265	12,634,081
Total equity and liabilities	150,822,831	153,672,634

Consolidated statement of cash flows (unaudited)

	Q2 2024	Q2 2023	H1 2024	H1 2023
In USD	(unaudited)	(unaudited)	(unaudited)	(unaudited)
Profit and other comprehensive income for the	4,548,918		1,193,783 7,554,189	1,073,405
period
Adjustments for:	-
Financial income	(53,881)	-	(109,895)	-
Financial expenses	2,134,840		862,350 4,294,883	847,704
Depreciation and amortisation	2,877,260		1,238,417 5,897,539	1,238,417
Cash flow from operating activities before changes
in working capital	9,507,137		3,294,549 17,636,716	3,159,526
Changes in working capital
Increase in trade and other receivables		756,886 (4,680,677)		(163,052) (4,680,677)
Increase in trade and other payables	566,171		1,772,037 1,507,348	1,907,059
Accrued/(Deferred) income	(250,615)	279,857	(723,731)	279,857
Cash flow from operating activities	10,579,580		665,766 18,257,281	665,765
Acquisition of vessels	-	(121,200,883)	(12,233)	(121,200,883)
Drydocking costs	(2,641,582)	-	(2,641,582)	-
Interest received	53,881	134,670	109,895	134,670
Cash flow from investing activities	(2,587,702)	(121,066,213) (2,543,920)		(121,066,213)
Proceeds from issue of shares	-	67,103,002	-	67,103,002
Transaction related costs	-	(3,281,783)	-	(3,281,783)
Dividends paid	(3,375,000)	-	(6,412,500)	-
Proceeds from issue of debt	-	67,500,000	-	67,500,000
Borrowing costs	-	(1,066,439)		(56,096) (1,066,439)
Repayment of debt		(2,565,000) (2,482,500) (5,130,000) (2,482,500)
Interest paid on interest-bearing debt	(2,054,123)		(940,689) (4,125,653)	(940,689)
Cash flow from financing activities	(7,994,123) 126,831,591			(15,724,249) 126,831,591
Net change in cash and cash equivalents	(2,245)	6,431,142	(10,889)	6,431,142
Cash and cash equivalents at beginning of period	2,336,734	-	2,345,378	-
Cash and cash equivalents at end of period	2,334,489		6,431,142 2,334,489	6,431,142