Belships

Earnings Release • Oct 26, 2017

Belships ASA : Report 3rd quarter 2017

Belships ASA : Report 3rd quarter 2017

HIGHLIGHTS

· Operating income of USD 6.7 m (Q2: USD 6.4 m)

· EBITDA of USD 3.5 m (USD 3.0 m)

· Net result of USD 1.7 m (USD 0.7 m)

· All ships operating normally - modern fleet - average age 5.1 years

· Contract coverage 100% for delivered ships - around USD 51 million fixed

charter

Third quarter 2017 results

Belships operating income in 3rd quarter 2017 was USD 6.7 million (Q2: USD 6.4

million), while EBITDA amounted to USD 3.5 million (USD 3.0 million). The

Group's operating result amounted to USD 2.9 million (USD 2.1 million), while

net result for 3rd quarter 2017 was USD 1.7 million (USD 0.7 million). The

figures for third quarter includes impairment reversal of USD 0.5 million.

Fleet status

Belships concentrates on the dry bulk market, with 5 x 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. M/S Belforest was extended to Cargill for 11-13 months effective

from 1st October, whereas M/S Belocean will be open in January. All ships have

sailed without significant off-hire. Technical management is handled by Belships

Management (Singapore), with a total fleet of 12 ships under technical

management.

Newbuilding program

Belships' remaining newbuilding program with Imabari Shipbuilding in Japan

includes one 63 000 dwt eco-design Ultramax bulk carrier on a long-term T/C-in

agreement incl. purchase option for delivery in January 2018 and another sister

vessel on a similar scheme within first half 2020.

Financial and corporate matters

As per 30 September the Group's cash totaled USD 7.9 million compared to USD

7.4 million as per 30 June.

The mortgage debt as per 30 September was USD 32.5 million. Net lease obligation

as at 30 September was USD 43.2 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 1.7 million

in 3rd quarter.

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 70%.

At the end of the 3rd quarter of 2017, the book value per share amounted to NOK

3.90 (USD 0.49), while the equity ratio was 22.4%. 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 3rd quarter at USD 18 725 per day, whereas the

Panamax-index ended at USD 10 509 per day. The Supramax-index ended the quarter

at USD 11 430 per day. As per today the Cape index stands at USD 22 145 per day,

Panamax-index at USD 13 223 per day and Supramax-index at USD 12 550 per day.

Baltic S&P Assessment's valuation of a 5-year old Supramax is currently USD

16.9 million.

Outlook

China's iron ore imports surged 11% y/y in September to 103 million tonnes. YTD

figures are currently up 7.1% to 817 million tonnes according to Fearnleys,

implying that last year's record of 1.02 billion tonnes is within reach at the

current pace.

In addition to the increasing Chinese demand for overseas high-grade iron ore

and coal, the grain market has contributed significantly with increased demand

for corn and soy crop from US Gulf and East Coast South America.

In January the company will take delivery of a 63 000 dwt eco-design newbuilding

from Imabari Shipbuilding and intend to find cover for this open position within

November-December. Belships also have M/S Belocean coming open around year end

and the company will be in a beneficial position if the market, as

traditionally, continues to strengthen in Q4.

Belships' vessels are chartered out on fixed rates to reputable counterparts,

representing a future nominal gross hire of around USD 51 million.

Focus will be to further develop Belships as an owner and operator of modern

bulk carriers to reputable counterparts. Our ambition is to build a portfolio of

quality ships and robust charter parties that will generate distributable cash

flows.

Oslo, 26 October 2017

THE BOARD OF BELSHIPS ASA

Please contact CEO Ulrich Müller at phone +47 22 52 76 15 if any questions.

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.