Stainless Tankers ASA

Quarterly Report • Aug 9, 2023

Condensed interim financial statements

The reported condensed interim consolidated financial figures for the Stainless Tankers Group presented below comprise revenue and expenses incurred during the period 1 December 2022 – 30 June 2023 ('YTD').

Consolidated statement of profit or loss and other comprehensive income (unaudited)

In USD	Notes	YTD	Q2 2023
Operating revenue	5	7,019,155	7,019,155
Vessel voyage expenses	6	(415,696)	(415,696)
Vessel operating expenses	7	(2,654,578)	(2,654,578)
Administrative expenses	8	(687,152)	(552,129)
Other income		10,098	10,098
EBITDA		3,271,826	3,406,849
Depreciation		(1,238,417)	(1,238,417)
Operating result (EBIT)		2,033,409	2,168,432
Financial income	9	134,670	120,024
Financial expenses	9	(1,094,674)	(1,094,674)
Profit before tax (EBT)		1,073,405	1,193,783
Taxes		(12,548)	(12,548)
Profit and other comprehensive income for the period		1,060,857	1,181,235
Attributable to:
Equity holders of the parent company		1,060,857	1,181,235
Non-controlling interests		-	-
		1,060,857	1,181,235

Consolidated statement of financial position (unaudited)

In USD	Notes	30 Jun 2023
ASSETS
Non-current assets
Vessels	10	119,962,466
Total non-current assets		119,962,466
Current assets
Trade and other receivables	11	4,680,677
Cash and cash equivalents	12	6,431,143
Total current assets		11,111,820
Total assets		131,074,287
EQUITY AND LIABILITIES
Equity
Share capital		13,072,672
Share premium		50,748,547
Retained earnings		1,060,857
Total equity		64,882,076
Non-current liabilities
Interest-bearing debt - non-current	14	54,873,562
Total non-current liabilities		54,873,562
Current liabilities
Interest-bearing debt – current	14	9,119,185
Trade and other payables	15	1,907,059
Accrued taxation		12,548
Deferred income		279,857
Total current liabilities		11,318,649
Total equity and liabilities		131,074,287

2

Consolidated statement of changes in equity (unaudited)

In USD	Notes	Share capital	Share premium	Retained earnings	Total
As at 01 December 2022 Capital increase - private		-	-	-	-
placement (cash)	13	13,072,672	54,030,330		67,103,002
Transaction costs			(3,281,783)		(3,281,783)
Profit and other comprehensive income for the period				1,060,857	1,060,857
As at 30 June 2023		13,072,672	50,748,547	1,060,857	64,882,076

Consolidated statement of cash flows (unaudited)

In USD	Notes	YTD
Profit and other comprehensive income for the period		1,073,405
Financial expenses	9	847,704
Depreciation	10	1,238,417
Cash flow from operating activities before changes in working capital		3,159,526
Changes in working capital
Increase in trade and other receivables		(4,680,677)
Increase in trade and other payables		1,907,509
Deferred income		279,857
Cash flow from operating activities		665,765
Acquisition of vessels		(121,200,883)
Interest received		134,670
Cash flow from investing activities		(121,066,213)
Proceeds from issue of share capital	13	67,103,002
Transaction related costs		(3,281,783)
Proceeds from issue of debt	14	67,500,000
Borrowing costs	14	(1,066,439)
Repayment of debt	14	(2,482,500)
Interest paid on interest-bearing debt	14	(940,689)
Cash flow from financing activities		126,831,591
Net change in cash and cash equivalents		6,431,142
Cash and cash equivalents at beginning of period		-
Cash and cash equivalents at end of period	12	6,431,142

Notes to the condensed interim consolidated financial statements (unaudited)

Note 1 – General informaƟon

Stainless Tankers ASA (the 'Company') was incorporated on 1 December 2022 by TuŌon Management Limited ("TML"), as a limited liability company and was established for the sole purpose to operate as a holding company for a shipping group owning seven stainless steel chemical tankers. These consolidated financial statements comprise the Company and its subsidiaries (together referred to as the 'Group').

The shares of the Company are listed on the Euronext Growth Oslo exchange.

Stainless Tankers ASA is a public limited liability company incorporated and domiciled in Norway, with a registered address at Henrik Ibsens gate 90, 0255 Oslo, Norway.

Note 2 – Basis of preparaƟon

The interim consolidated financial statements for the period 1 December 2022 – 30 June 2023 are prepared in accordance with IAS 34 Interim Financial ReporƟng as issued by the InternaƟonal AccounƟng Standards Board ('IASB') and as adopted by the European Union. These are the first financial statements prepared in accordance with IFRS, and IFRS 1 First-Ɵme adopƟon of IFRS has been applied.

The financial statements have not been subject to an audit and do not include all informaƟon and disclosures required in the annual financial statements.

The financial statements are based on historical cost except as disclosed in the accounts.

The financial statements are presented in US Dollar (US\$), which is the funcƟonal currency of the Company and the Group.

The interim consolidated financial statements are prepared based on the assumpƟon of going concern.

Only standards and interpretaƟons that are applicable to the Group have been included and the Group reviews the impact of these changes in its financial statements. There are some amendments to the standards effecƟve from 1 January 2023. None of these have had any effect on the Financial Statements. The Group will adopt the relevant new and amended standards and interpretaƟons when they become effecƟve, subject to EU approval before the consolidated financial statements are issued. At the date of the approval of these FS, the group has not idenƟfied any significant impact to the Group's Financial Statements as a result of new standards or amendments effecƟve 2023 or later.

Note 3 – Significant accounƟng policies

ConsolidaƟon

The interim consolidated financial statements comprise the financial statements of Stainless Tankers ASA and its subsidiaries as at 30 June 2023. All intra-group balances, transacƟons, unrealised gains and losses resulƟng from intra-group transacƟons and dividends are eliminated. Subsidiaries are all companies where the Group has a controlling interest. Control is achieved when the Group is exposed, or has rights to variable returns from its involvement with the investee and has the ability to effect those returns through its power over the investee. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date on which control ceases. The financial statements of the subsidiaries are prepared for the same accounƟng period as those of the Company, using consistent accounƟng principles for similar transacƟons and events under otherwise similar circumstances.

Non-controlling interests represent the porƟon of comprehensive income and net assets that are not held by the Group and are presented separately in the consolidated statement of comprehensive income and within equity in the consolidated statement of financial posiƟon, separately from the Company's shareholders' equity.

Revenue recogniƟon

The Group's Ɵme charter contract revenues are separated into a lease element accounted with IFRS 16 Leases and a service element which is accounted for in accordance with IFRS 15 Revenue from Contracts with Customers.

Time charter, pool revenue and other revenue contracts with customers are recognised when control of goods or services are transferred to the customer and when each separate performance obligaƟon in the customer contract is fulfilled following the "over-Ɵme principle". It is recognised at an amount that reflects the consideraƟon which the Group expects to receive in exchange for those goods or services.

The Group acts as a parƟcipant in the pool arrangements. The performance obligaƟon under the pool arrangements is equal as set under the Ɵme charter contracts. Revenues for the vessels employed in the pool are based on average revenues across the pool the vessels are employed in, i.e. the vessels earn the average charter rate of the pool for the respecƟve month, with certain adjustments which reflect the relaƟve specificaƟon of each vessel in the pool.

The service element from the Group's Ɵme charter contracts is recognised over Ɵme, as the performance obligaƟon is also saƟsfied over Ɵme. Revenue from bunkers and other goods and services from customers are recognised during the period the goods or services are transferred to the customer, following the "point in Ɵme principle".

OperaƟng expenses

OperaƟng expenses are accounted for on an accrual basis. Expenses are charged to the income statement, except for those incurred in the acquisiƟon of an investment which are capitalised as part of the cost of the investment. Expenses arising from the disposal of investments are deducted from disposal proceeds.

Vessel operaƟng expenses of the Group are expenses related to the operaƟon of vessels, such as (but not limited to) crewing expenses, expenses for repair and maintenance, lubricaƟon oil consumpƟon and insurance.

Financial income and expenses

Interest income and expense is recognised as accrued and is presented under the financial income or expense in the income statement.

Foreign currency transacƟons

TransacƟons in foreign currencies are recorded in the funcƟonal currency exchange rate at the date of the transacƟon. Monetary assets and liabiliƟes in foreign currency are translated at the funcƟonal currency exchange rate prevailing at the balance sheet date. Exchange differences arising from translaƟons into the funcƟonal currency are recorded in the income statement. Non-monetary assets and liabiliƟes measured at historical cost in foreign currency are translated into the funcƟonal currency using the historical exchange rate. Non-monetary assets and liabiliƟes recognised at fair value are translated using the exchange rate on the date of the determinaƟon of the fair value.

For subsidiaries with funcƟonal currencies other than USD, financial posiƟon items are translated at the rate of exchange at the balance sheet date, and income statements are translated at the exchange rate prevailing at the date of the transacƟon. Exchange differences arising on the translaƟon are recognized in other comprehensive income as foreign currency differences.

Vessels and other tangible assets

Tangible fixed assets are stated at historical cost, less subsequent depreciaƟon and impairment. For vessels purchased, these costs include expenditures that are directly aƩributable to the acquisiƟon of the vessels and eligible for capitalisaƟon. Upon acquisiƟon, all components of the vessels, with a cost significant to the total acquisiƟon costs, are separately idenƟfied and depreciated over that component's useful life on a straight-line basis.

DepreciaƟon is calculated on a straight-line basis over the esƟmated useful life of the assets, taking residual values into consideraƟon, and adjusted for impairment charges, if any. The esƟmated useful life of the Group's vessels are 25 years. Residual values of the vessels are esƟmated as the lightweight tonnage of each vessel mulƟplied by scrap value per ton. Expected useful lives of assets, and residual values, are reviewed at each balance sheet date and, where they differ significantly from previous esƟmates, depreciaƟon calculaƟons are altered accordingly.

Ordinary repairs and maintenance expenses are charged to the income statement as incurred. Costs related to dry-docking or other major overhauls are recognized in the carrying amount of the vessels. This recogniƟon is made when the dry-docking has been performed and is depreciated based on esƟmated Ɵme to the next class renewal, which is normally five years. All other costs that do not meet this recogniƟon criteria are expensed as repairs and maintenance.

Vessels and other tangible assets are derecognised upon disposal or when no future economic benefits are expected from their use or disposal. Any gain or loss arising from the derecogniƟon of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) are included in the profit or loss during the period the asset is derecognised.

Impairment of vessels and other tangible assets

Vessels and other tangible assets are assessed for impairment indicators at each reporƟng period. If impairment indicators are idenƟfied, the recoverable amount is esƟmated, and if the carrying amount exceeds its recoverable amount an impairment loss is recognised, i.e. the asset is wriƩen down to its recoverable amount. An asset's recoverable amount is calculated as the higher of the net realisable value and its value in use. The net realisable value is the amount obtainable from the sale of an asset in an arm's length transacƟon less the costs of sale and the value in use is the present value of esƟmated future cash flows expected from the conƟnued use of an asset. An impairment loss recognised in prior periods for an asset is reversed if, and only if, there has been a change in the esƟmates used to determine the asset's recoverable amount since the last impairment loss was recognised.

Leases

Group as lessor

The Group enters into lease agreements as a lessor with respect to its vessels under operaƟng leases to nonrelated parƟes.

Leases where substanƟally all risks and rewards incidental to ownership are retained by the lessor are classified as operaƟng leases. Charter income received under operaƟng leases (net of any incenƟves given to the lessee) are recognised in profit or loss on a straight-line basis over the period of the lease term.

Fuel and lubricaƟon oil

The Group values its inventories, which comprise lubricaƟon oil and fuel on board the vessels, at the lower of cost and net realisable value. They are accounted for on a weighted average cost basis.

Trade and other receivables

Trade and other receivables are measured at the transacƟon price upon iniƟal recogniƟon and subsequently measured at amorƟzed cost less expected credit losses.

Cash and cash equivalents

Cash and cash equivalents include restricted and unrestricted cash, bank deposits and other highly liquid investments with original maturiƟes of three months or less.

Share issuance

Share issuance costs related to a share issuance transacƟon are recognised directly in equity. If share issuance costs, for tax purposes, can be deducted from other taxable income in the same period as they are incurred, the costs are recognised net aŌer tax.

Dividends

Dividends are recognised as a liability in the Group's financial statements from the date when the dividend is approved by the General MeeƟng.

Financial liabiliƟes

All loans and borrowings are iniƟally measured at fair value less directly aƩributable transacƟon costs, and are subsequently measured at amorƟzed cost, using the effecƟve interest method. The calculaƟon takes into account any premium or discount on acquisiƟon and includes transacƟon costs and fees that are an integral part of the effecƟve interest rate. A financial liability is derecognised when the obligaƟon under the liability is discharged, cancelled, or expires.

Provisions

Provisions are recognised when the Group has a present legal or construcƟve obligaƟon as a result of a past event, when it is more likely than not that an ouƞlow or resources represenƟng economic benefits will be required to seƩle the obligaƟon and a reliable esƟmate can be made for the amount of the obligaƟon.

Fair value measurement

DerivaƟve financial instruments are measured at fair value. The fair value of financial instruments traded in acƟve markets are determined by reference to quoted market prices or dealer price quotaƟons, without any deducƟon for transacƟon costs. The fair value of financial instruments not traded in acƟve markets is determined using appropriate evaluaƟon techniques.

Taxes

The Group operates within several jurisdicƟons and tax regimes, including the Norwegian general tax regime and tonnage tax regime as well as the Isle of Man tax regime. Changes in taxaƟon law or the interpretaƟon of taxaƟon law may affect the business, results of operaƟons and financial condiƟon of the Group. To the extent tax rules change, this could have both a prospecƟve and retrospecƟve impact on the Group both of which could be material. The Group's income tax returns may be subject to examinaƟon and review. If any tax authority successfully challenges the Group's operaƟonal or legal structure, eligibility for the Norwegian tonnage tax regime, hereunder due to performance of disqualifying acƟviƟes or holding disqualifying assets, taxable pretence or similar circumstances, the Group's effecƟve tax rate could increase substanƟally and have a material adverse effect on the Group's business, financial condiƟon, results of operaƟons, cash flows and/or prospects.

It is the intenƟon that the Group will be taxed under the Norwegian tonnage tax regime. Under the tonnage tax regime, qualifying shipping income is exempt from taxaƟon in Norway. Net financial income is subject to tax in accordance with the general Norwegian tax rules and certain special rules in the tonnage tax regime. Instead of tax on qualifying shipping income, a tonnage tax based on the net tonnage of the vessel(s) is paid. Should the Group for any reason such as due to acƟviƟes and/or assets held by a Group company not qualify for the Norwegian tonnage tax regime, net taxable profits are taxed at the corporate income tax rate, currently 22%.

The Company's subsidiaries are incorporated in the Isle of Man and will, consequently, in principle be taxable in the Isle of Man under local regulaƟon and will not be subject to any material taxaƟon under the laws of Isle of Man. There can be no assurance that this will conƟnue, as Isle of Man may change its tax laws and regulaƟons. Further, also other jurisdicƟons may claim that Group companies are tax resident in their jurisdicƟon and claim taxes on earnings or assets on that basis.

Related parƟes

ParƟes are related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the party in making financial and operaƟng decisions. ParƟes are also related if they are subject to common control or common significant influence. Related party transacƟons are recorded based on their esƟmated fair value.

ClassificaƟon in the statement of financial posiƟon

Current assets and short-term liabiliƟes comprised of items due less than one year from the balance sheet date, as well as items due more than one year from the balance sheet date that are related to the operaƟng cycle.

LiabiliƟes with maturiƟes less than one year from the balance sheet date are classified as current. All other debt is classified as long-term debt. Long-term debt due for repayment within one year from the balance sheet date is classified as current.

Statement of cash flows

The statement of cash flows has been prepared based on the indirect method.

Subsequent events

New informaƟon on the Group's financial posiƟon at the balance sheet date is taken into account in the financial statements. Subsequent events that do not affect the Group's posiƟon at the balance sheet date, but which will affect the Group's posiƟon in the future, are disclosed if significant.

Note 4 - CriƟcal accounƟng judgements and key sources of esƟmaƟon uncertainty

The preparaƟon of interim consolidated financial statements for the Group and applicaƟon of the accounƟng policies, which are described in Note 3, requires judgements, esƟmates and assumpƟons to be made about the carrying amounts of assets and liabiliƟes. The esƟmates and associated assumpƟons are based on historical experience and other factors considered to be relevant. Actual outcomes may differ from these esƟmates and assumpƟons and could require a material adjustment to the carrying amount of the asset or liability affected in future periods. EsƟmates and underlying assumpƟons are reviewed on an on-going basis.

Judgments

In the process of applying the Group's accounƟng policies, management has made the following judgments, apart from those involving esƟmaƟons, which had the most significant effect on the amounts recognised in the consolidated financial statements:

Vessel life and impairment

The carrying value of the Group's vessel represents its original cost at the Ɵme it was delivered or purchased less depreciaƟon calculated using an esƟmated useful life of 25 years from the date the vessel was originally delivered from the shipyard. In the shipping industry, use of life in this range has become the standard. The actual life of a vessel may be different. If the economic life assigned to the vessel proves to be too long because of new regulaƟons or other future events, higher depreciaƟon expense and impairment losses could result in future periods related to a reducƟon in the useful life of the vessel.

The carrying value of the Group's vessel may not represent its fair market value at any point in Ɵme since the market prices of second-hand vessels tend to fluctuate with changes in charter rates and the cost of new buildings. Historically, both charter rates and vessel values tend to be both correlated and volaƟle. The Group records impairment losses only when events occur that cause the Group to believe that future cash flows for the vessel will be less than its carrying value. The carrying amount of a vessel held and used by the Group is reviewed for potenƟal impairment whenever events or changes in circumstances indicate that the carrying amount of the vessel may not be fully recoverable. In such instances, an impairment charge would be

recognised if the esƟmate of the discounted future cash flows expected to result from the use of the vessel and its eventual disposiƟon is less than the vessel's carrying amount.

In developing esƟmates of future cash flows, the Group must make assumpƟons about future charter rates, ship operaƟng expenses and the esƟmated remaining useful life of the vessel. These assumpƟons are based on historical trends as well as future expectaƟons. Although management believes that the assumpƟons used to evaluate potenƟal impairment are reasonable and appropriate, such assumpƟons may be highly subjecƟve.

Note 5 - Operating revenue

	YTD	Q2 2023
	US\$	US\$
Service revenue from time charters	915,161	915,161
Lease revenue from time charters	959,278	959,278
Pool charter revenue	5,144,715	5,144,715
	7,019,155	7,019,155

(a) Contract balances

The Group has recognised the following liabilities related to contracts with customers:

	30 Jun 2023
	US\$
Contract liabilities
Current
Contract liabilities	461,301
Total contract liabilities	461,301

Contract liabilities represent the performance due to a charterer for the remaining lease period, as at the period end. This may happen in the case where the charterer has made an advance payment before the completion of the lease period, as of the period end date.

(b) Performance obligations

Information about the Group's performance obligations are summarised below:

Revenue from time charters - Under IFRS 15, the lease component and the service component of time charters need to be separately disclosed. The service component is accounted for separately under IFRS 15. The service component in the time charter includes a single performance obligation. The performance obligation is satisfied over time, given that the charterers simultaneously receive and consume the benefits provided by the Group. Revenue recognized in respect of the service component under IFRS 15 did not change. The lease component continues to be accounted for as a lease under IFRS 16 (Note 5).

The transaction price allocated to the remaining performance obligations (unsatisfied or partially unsatisfied) as at 30 June 2023 are, as follows:

Note 9 - Finance (costs)/income

		30 Jun 2023
		US\$
Within one year		3,868,973
Between two to five years		-
		3,868,973
Note 6 – Vessel voyage expenses
	YTD	Q2 2023
	US\$	US\$
Commission fees	266,846	266,846
Bunkers consumption	2,292	2,292
Pool administration costs and other expenses	144,827	144,827
Other voyage expenses	1,731	1,731
	415,696	415,696
Note 7 – Vessel operating expenses
	YTD	Q2 2023
	US\$	US\$
Vessel operating expenses	2,654,578	2,654,578
	2,654,578	2,654,578
Note 8 – Administrative expenses
	YTD	Q2 2023
	US\$	US\$
Auditor's remuneration	40,000	40,000
Legal and other professional fees	67,187	11,203
Directors' fees (Note 16)	47,869	47,869
Management service fees	482,300	414,050
Bank charges	4,146	3,692
Other expenses	45,649	35,315
	687,152	552,129

Between 1 March 2023 and 30 June 2023, the Company paid a management service fee of US\$482,300 to its shareholder TML, in accordance with the Management Services Agreement.

	YTD	Q2 2023
	US\$	US\$
Interest income	134,670	120,024
Finance income	134,670	120,024
Interest expense (Note 14)	(982,374)	(977,836)
Debt commitment fees	(112,300)	(112,300)
Finance costs	(1,094,674)	(1,094,674)
Net finance costs	(960,004)	(974,650)

Note 10 - Vessels

	30 Jun 2023
	Total
	US\$
Cost
Additions	121,200,883
Balance as at 30 June 2023	121,200,883
Depreciation
Charge for the period	1,238,417
Balance as at 30 June 2023	1,238,417
Net book amount
Balance as at 30 June 2023	119,962,466
Insured value (US\$)	177,050,000
Total light weight tonnage (ldt)	36,928.86

The total insured value subsequent to the period end was reduced to US\$155,859,000.

On 17 March 2023, BSL Gwen Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST1 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel Gwen with an IMO number 9407067, built in 2008. The purchase price was agreed at US\$17,100,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 19 May 2023. Included in the addiƟons above, there is a price reducƟon amounƟng to US\$290,000 and various takeover costs and legal fees amounƟng to US\$19,143 which are amorƟsed over the remaining useful life of the vessel.

On 17 March 2023, BSL Barbouni Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST2 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel Barbouni with an IMO number 9416020, built in 2007. The purchase price was agreed at US\$16,300,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 11 April 2023. Included in the addiƟons above, there is a price reducƟon amounƟng to US\$86,281 and various takeover costs and legal fees amounƟng to US\$16,143 which are amorƟsed over the remaining useful life of the vessel.

On 17 March 2023, HSL Filly Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST23 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel Lavraki with an IMO number 9323077, built in 2007. The purchase price was agreed at US\$15,800,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 29 June 2023. Included in the addiƟons above, there is a price reducƟon amounƟng to US\$536,000 and various takeover costs and legal fees amounƟng to US\$16,143 which are amorƟsed over the remaining useful life of the vessel.

On 17 March 2023, HSL Bronco Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST4 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel City Island with an IMO number 9360960, built in 2007. The purchase price was agreed at US\$17,100,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 4 May 2023. Included in

the addiƟons above, there is a price reducƟon amounƟng to US\$384,292 and various takeover costs and legal fees amounƟng to US\$39,833 which are amorƟsed over the remaining useful life of the vessel.

On 17 March 2023, ASL Orchid Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST5 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel Orchid Kefalonia with an IMO number 9363821, built in 2008. The purchase price was agreed at US\$18,200,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 10 May 2023. Included in the addiƟons above, there is a price reducƟon amounƟng to US\$452,870 and various takeover costs and legal fees amounƟng to US\$16,143 which are amorƟsed over the remaining useful life of the vessel.

On 17 March 2023, ASL Friesian Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST6 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel Orchid Sylt with an IMO number 9367413, built in 2009. The purchase price was agreed at US\$19,400,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 2 May 2023. Included in the addiƟons above, there is a price reducƟon amounƟng to US\$361,292 and various takeover costs and legal fees amounƟng to US\$19,143 which are amorƟsed over the remaining useful life of the vessel.

On 17 March 2023, ASL Charger Shipping Ltd (Sellers) entered into a memorandum of agreement (the 'MoA') with ST7 Ltd (Buyers) for the acquisiƟon of a Japanese built stainless steel chemical tanker vessel Orchid Madeira with an IMO number 9367401, built in 2009. The purchase price was agreed at US\$19,400,000. Pursuant to the MoA, the vessel was to be delivered prior to 1 April 2023, with a daily penalty to be subtracted from the purchase price for each day passing aŌer 1 April 2023. The vessel was delivered on 12 April 2023. Included in the addiƟons above, there is a price reducƟon amounƟng to US\$130,573 and various takeover costs and legal fees amounƟng to US\$15,643 which are amorƟsed over the remaining useful life of the vessel.

The vessels are pledged on [the Group's] bank loan detailed in Note 14.

As at 30 June 2023, the management carried out an assessment of whether there is any indicaƟon that the vessels may have suffered an impairment loss. Management assessed the recoverable amount as at the period end and no impairment was recognised in the period ended 30 June 2023 based on the assessment.

Note 11 - Trade and other receivables

	30 Jun 2023
	US\$
Charterers balances receivable	2,913,004
Pool working capital receivable	1,200,000
Prepayments	479,006
Accrued income	9,017
Other receivables	79,651
	4,680,677

Included in the prepayments, there is an amount of US\$320,443 due from the ship managers of the vessels, representing advance cash paid.

Note 12 - Cash and cash equivalents

Cash balances are analysed as follows:

30 Jun 2023
US\$
4,097,810
2,333,333
6,431,143

Restricted cash comprise (i) a minimum liquidity requirement of US\$250,000 per Vessel held in a restricted cash account and (ii) funding of a dry dock reserve account of US\$583,333 (Note 14).

Note 13 - Equity contribution

	No. of shares	Share capital	Share premium	Total
		US\$	US\$	US\$
Balance as at 01 December 2022	-	-	-	-
Proceeds during the period	13,500,000	13,072,672	54,030,330	67,103,002
Balance as at 30 June 2023	13,500,000	13,072,672	54,030,330	67,103,002

The equity contribution represents paid in capital made by the equity holders during the period.

Note 14 - Borrowings

	30 Jun 2023 US\$
Current borrowings
Bank loans	9,119,185
Non-current borrowings
Bank loans	54,873,562
Total	63,992,747
Maturity of borrowings:
	30 Jun 2023
	US\$
Within one year	9,119,185
Between two and five years	54,873,562
	63,992,747

On 17 March 2023, Stainless Tankers Limited ("STL") as borrower, (ii) the SPVs as buyers, (iii) the Company as guarantor (collecƟvely, the Obligors), and (iv) Macquarie Bank Limited, London Branch as lender, arranger, facility agent and security agent" (the "Lender") entered into a facility agreement whereby the Lender makes available a loan of up to US\$97,500,000, comprising a US\$67,500,000 tranche, being the CommiƩed

Amount, and US\$30,000,000 or such other higher amount as might be agreed between the Lender and the ship owning enƟƟes, being the UncommiƩed Amount (the "Facility Agreement").

The Facility Agreement was, inter alia, entered into in order to provide the ship owning enƟƟes with financing for the purchase of the Vessels, in addiƟon to the equity capital the Group would provide from the Private Placement.

Interest will accrue quarterly and commenced on the uƟlisaƟon date 30 March 2023, with first scheduled payment on 30 June 2023. Final repayment of the Facility Agreement is scheduled separately for each Vessel tranche, at the earlier of when a Vessel has reached twenty years of age or five years from uƟlisaƟon. Voluntary prepayment is allowed at higher amounts in mulƟples of US\$500,000. Mandatory prepayment becomes automaƟcally due in the case of a sale or total loss, as well as any arrest from which a Vessel is not released within a period of 45 days. In the laƩer case, repayment is due for each Vessel's tranche, respecƟvely.

The Facility Agreement includes covenants on (i) a minimum liquidity requirement of US\$250,000 per Vessel held in a restricted cash account at all Ɵmes (earning interest at 30-day SOFR p.a.), (ii) a conƟnuing maximum loan to value raƟo of 65%, (iii) funding of a dry dock reserve account in equal monthly instalments beginning 12 months prior to an upcoming capex event for each Vessel, and (iv) saƟsfactory vessel inspecƟons to be performed prior to drawdown. The restricƟons on dividends for STL according to the Facility Agreement include (i) lender approval on the basis of a 12-month cash flow forecast, illustraƟng to the lender's saƟsfacƟon that the borrower will not face liquidity constraints following a proposed dividend, (ii) a maximum loan to value raƟo of 60% immediately following the dividend distribuƟon, and (iii) maintenance of US\$250,000 in unrestricted cash per Vessel immediately following dividend distribuƟon.

Movement analysis:

	30 Jun 23
	US\$
Balance as at 01 December 2022	-
Drawdown (gross of borrowing costs)	67,500,000
Capitalised borrowing costs	(1,066,439)
Repayments	(2,482,500)
Interest expense (Note 9)	940,689
Amortisation of borrowing costs (Note 9)	41,686
Interest paid	(940,689)
Balance as at 30 June 2023	63,992,747
Note 15 - Trade and other payables
	30 Jun 23
	US\$
Pool working capital	1,200,000
Trade payables	278,742
Accruals	286,752
Other payables	141,565

1,907,059

Note 16 - Related party transactions

Transactions with related parties (Note 8)

			YTD	Q2 2023
Name	Nature of relationship	Nature of transactions	US\$	US\$
Directorship fees	Board of Directors	Directorship fees	47,869	47,869
			47,869	47,869

Note 17 - Contingent liabilities

The Group had no contingent liabilities as at 30 June 2023.

Note 18 - Commitments

Operating lease commitments

The Group as lessor

Contracted revenues from vessels operations

The Group's long-term time charter arrangements aggregate time charter hire revenues as at the year-end over the firm contract period receivable are as follows:

	Lease revenue from time charters	Service revenue from time charters	Total
	US\$	US\$	US\$
Within one year	4,057,152	3,868,973	7,926,125
Between two and five years	-	-	-
	4,057,152	3,868,973	7,926,125

Note 19 - Events after the reporting period

There have been no events subsequent to period end which require adjustment of or disclosure in the consolidated financial statements or notes thereto.