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Golden Ocean Group
Quarterly Report • May 21, 2025
6243_rns_2025-05-21_dd0383f2-b192-4797-b489-1635c99352a0.pdf
Quarterly Report
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Golden Ocean Results Q1 2025
May 21st, 2025
Forward-looking statements
Matters discussed in this presentation may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995, or the PSLRA, provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.
The Company is taking advantage of the safe harbor provisions of the PSLRA and is including this cautionary statement in connection therewith. This document and any other written or oral statements made by the Company or on its behalf may include forward-looking statements, which reflect the Company's current views with respect to future events and financial performance. This presentation includes assumptions, expectations, projections, intentions and beliefs about future events. These statements are intended as "forward-looking statements." The Company cautions that assumptions, expectations, projections, intentions and beliefs about future events may and often do vary from actual results and the differences can be material. When used in this document, the words "believe," "expect," "anticipate," "estimate," "intend," "plan," "targets," "projects," "likely," "will," "would," "could" and similar expressions or phrases may identify forward-looking statements. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in the Company's records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond the Company's control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. As a result, you are cautioned not to rely on any forwardlooking statements.
In addition to these important factors and matters discussed elsewhere herein, important factors that, in the Company's view, could cause actual results to differ materially from those discussed in the forward-looking statements, include among other things: the ability of Golden Ocean and CMB.TECH NV to successfully complete the proposed merger on anticipated terms; uncertainties as to the timing as to the contemplated transaction with CMB.TECH NV; the ability of CMB.TECH NV and Golden Ocean to receive the required regulatory approvals for the contemplated merger and the approval of Golden Ocean shareholders required in connection with the contemplated merger; unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies, expansion and growth of the combined company's operations and other conditions to the completion of the merger; general market trends in the dry bulk industry, which is cyclical and volatile, including fluctuations in charter hire rates and vessel values; a decrease in the market value of the Company's vessels; changes in supply and demand in the dry bulk shipping industry, including the market for the Company's vessels; an oversupply of dry bulk vessels, which may depress charter rates and profitability; the Company's future operating or financial results; the Company's continued borrowing availability under the Company's debt agreements and compliance with the covenants contained therein; the Company's ability to procure or have access to financing, the Company's liquidity and the adequacy of cash flows for the Company's operations; the failure of the Company's contract counterparties to meet their obligations, including changes in credit risk with respect to the Company's counterparties on contracts; the loss of a large customer or significant business relationship; the strength of world economies; the volatility of prevailing spot market and charter-hire charter rates, which may negatively affect the Company's earnings; the Company's ability to successfully employ the Company's dry bulk vessels and replace the Company's operating leases on favorable terms, or at all; changes in the Company's operating expenses and voyage costs, including bunker prices, fuel prices (including increased costs for low sulfur fuel), drydocking, crewing and insurance costs; the adequacy of the Company's insurance to cover the Company's losses, including in the case of a vessel collision; vessel breakdowns and instances of offhire; the Company's ability to fund future capital expenditures and investments in the construction, acquisition and refurbishment of the Company's vessels (including the amount and nature thereof and the timing of completion of vessels under construction, the delivery and commencement of operation dates, expected downtime and lost revenue); risks associated with any future vessel construction or the purchase of second-hand vessels; effects of new products and new technology in the Company's industry, including the potential for
technological innovation to reduce the value of the Company's vessels and charter income derived therefrom; the impact of an interruption or failure of the Company's information technology and communications systems, including the impact of cybersecurity threats and data security breaches, upon the Company's ability to operate; potential liability from safety, environmental, governmental and other requirements and potential significant additional expenditures (by the Company and the Company's customers) related to complying with such regulations; changes in governmental rules and regulations or actions taken by regulatory authorities and the impact of government inquiries and investigations; the arrest of the Company's vessels by maritime claimants; government requisition of the Company's vessels during a period of war or emergency; the Company's compliance with complex laws, regulations, including environmental laws and regulations and the U.S. Foreign Corrupt Practices Act of 1977; potential difference in interests between or among certain members of the Board of Directors, executive officers, senior management and shareholders; the Company's ability to attract, retain and motivate key employees; work stoppages or other labor disruptions by the Company's employees or the employees of other companies in related industries; potential exposure or loss from investment in derivative instruments; stability of Europe and the Euro or the inability of countries to refinance their debts; inflationary pressures and the central bank policies intended to combat overall inflation and rising interest rates and foreign exchange rates; fluctuations in currencies; the impact that any discontinuance, modification or other reform or the establishment of alternative reference rates have on the Company's floating interest rate debt instruments; acts of piracy on ocean-going vessels, public health threats, terrorist attacks and international hostilities and political instability; potential physical disruption of shipping routes due to accidents, climaterelated (acute and chronic), political instability, terrorist attacks, piracy, international sanctions or international hostilities, including the developments in the Ukraine region and in the Middle East, including the conflicts in Israel and Gaza, and the Houthi attacks in the Red Sea; general domestic and international political and geopolitical conditions or events, including any further changes in U.S. trade policy that could trigger retaliatory actions by affected countries; the impact of restrictions on trade, including the imposition of new tariffs, port fees and other import restrictions by the United States on its trading partners and the imposition of retaliatory tariffs by China and the EU on the United States, and potential further protectionist measures and/or further retaliatory actions by others, including the imposition of tariffs or penalties on vessels calling in key export or import ports such as the United States, EU and/or China; the impact of adverse weather and natural disasters; the impact of increasing scrutiny and changing expectations from investors, lenders and other market participants with respect to the Company's Environmental, Social and Governance policies; changes in seaborne and other transportation; the length and severity of epidemics and pandemics and governmental responses thereto and the impact on the demand for seaborne transportation in the dry bulk sector; impacts of supply chain disruptions and market volatility surrounding impacts of the Russian-Ukrainian conflict and the developments in the Middle East; fluctuations in the contributions of the Company's joint ventures to the Company's profits and losses; the potential for shareholders to not be able to bring a suit against us or enforce a judgement obtained against us in the United States; the Company's treatment as a "passive foreign investment company" by U.S. tax authorities; being required to pay taxes on U.S. source income; the Company's operations being subject to economic substance requirements; the Company potentially becoming subject to corporate income tax in Bermuda in the future; the volatility of the stock price for the Company's common shares, from which investors could incur substantial losses, and the future sale of the Company's common shares, which could cause the market price of the Company's common shares to decline; and other important factors described from time to time in the reports filed by the Company with the U.S. Securities and Exchange Commission, including the Company's most recently filed Annual Report on Form 20-F for the year ended December 31, 2024.
The Company cautions readers of this presentation not to place undue reliance on these forward-looking statements, which speak only as of their dates. Except to the extent required by applicable law or regulation, the Company undertakes no obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this presentation or to reflect the occurrence of unanticipated events. These forward-looking statements are not guarantees of the Company's future performance, and actual results and future developments may vary materially from those projected in the forward-looking statements.
01 Company and financial update
- Adjusted EBITDA of \$12.7 million for the first quarter of 2025, compared with \$69.9 million for the fourth quarter of 2024
- Net loss of \$44.1 million and loss per share of \$0.22 for the first quarter of 2025, compared with net income of \$39.0 million and earnings per share of \$0.20 for the fourth quarter of 2024
- Reported TCE rates for Newcastlemax/Capesize and Kamsarmax/Panamax vessels of \$16,827 per day and \$10,424 per day, respectively, and \$14,409 per day for the entire fleet in the first quarter of 2025
- A total of \$38.4 million in drydocking expense was recorded in the first quarter of 2025 compared to \$34.3 million in the fourth quarter of 2024
- Entered into a term sheet for a contemplated stock for-stock merger with CMB.TECH NV
- Entered into agreements in March 2025 and April 2025 to sell two Kamsarmax vessels for a net consideration of \$15.8 million and \$16.8 million, respectively
- Estimated TCE rates, inclusive of charter coverage calculated on a load-to-discharge basis, are approximately:
- \$19,000 per day for 69% of Newcastlemax/Capesize available days and \$11,100 per day for 81% of Kamsarmax/Panamax available days for the second quarter of 20251
- \$20,900 per day for 12% of Newcastlemax/Capesize available days and \$12,900 per day for 38% of Kamsarmax/Panamax available days for the third quarter of 20251
- Announces a dividend of \$0.05 per share for the first quarter of 2025
Profit and loss
| Quarterly | |||||
|---|---|---|---|---|---|
| (in thousands of \$) |
Q1 2025 | Q4 2024 | Variance | ||
| Operating revenues and other operating income/expenses | 141,927 | 210,973 | (69,046) | ||
| Voyage expenses | (27,217) | (36,045) | 8,828 | Q1 2025 | Q4 2024 |
| Net revenues | 114,710 | 174,928 | (60,218) | ||
| Gain from disposal of vessels | - | 16,092 | (16,092) | TCE rate | TCE rate \$ 20,809 |
| Ship operating expenses | (95,318) | (95,606) | 288 | \$ 14,409 | |
| Administrative expenses | (5,354) | (6,482) | 1,128 | ||
| Charter hire expenses | (1,473) | (4,198) | 2,725 | ||
| Depreciation | (31,911) | (35,560) | 3,649 | EPS | |
| Net operating expenses | (134,056) | (141,846) | 7,790 | EPS | |
| Net operating income (loss) |
(19,346) | 49,174 | (68,520) | (\$ 0.22) | \$ 0.20 |
| Net financial expenses |
(22,036) | (23,331) | 1,295 | ||
| Derivatives and other income |
(2,515) | 13,559 | (16,074) | Net income | Net income |
| Net income (loss) before taxation |
(43,897) | 39,402 | (83,299) | ||
| Income tax expense | (245) | (398) | 153 | (\$ 44.1 million) | \$ 39.0 million |
| Net income (loss) |
(44,142) | 39,004 | (83,146) | ||
| Earnings (loss) per share: basic and diluted | (\$0.22) | \$0.20 | (\$0.42) | ||
| Adjusted EBITDA | 12,734 | 69,882 | (57,148) | ||
| TCE per day | 14,409 | 20,809 | (6,400) |
- Includes restricted cash 2. Net profit, adjusted for non-cash part of derivatives and sales gains, as per disclosure in press release 6
Cash flow First quarter 2025
Balance sheet
First quarter 2025
| Quarterly | |||||
|---|---|---|---|---|---|
| (in thousands of \$) | Q1 2025 | Q4 2024 | Variance | ||
| ASSETS | |||||
| Short term | |||||
| Cash and cash equivalents (incl. restricted cash) | 112,642 | 131,729 | (19,087) | ||
| Other current assets | 176,960 | 154,812 | 22,148 | Q1 2025 | Q4 2024 |
| Long term | |||||
| Vessels and equipment, net (incl. held for sale) | 2,928,502 | 2,959,129 | (30,627) | ||
| Leases, right of use assets | 108,790 | 60,504 | 48,286 | Loan-to-value1 | Loan-to-value1 |
| Other long-term assets | 66,732 | 73,120 | (6,388) | ||
| Total assets | 3,393,626 | 3,379,294 | 14,332 | ||
| LIABILITIES AND EQUITY | 39.2 % | 38.3 % | |||
| Short term | |||||
| Current portion of long-term debt | 113,848 | 113,848 | - | ||
| Current portion of finance lease obligations | 119,289 | 18,829 | 100,460 | Liquidity2 | Liquidity2 |
| Current portion of operating lease obligations | 264 | 2,414 | (2,150) | ||
| Other current liabilities | 122,307 | 99,301 | 23,006 | \$ 207 million | \$ 279 million |
| Long term | |||||
| Long-term debt | 1,210,431 | 1,188,679 | 21,752 | ||
| Non-current portion of finance lease obligations | - | 49,158 | (49,158) | ||
| Non-current portion of operating lease obligations | 988 | 6,918 | (5,930) | ||
| Other long-term liabilities | 574 | 170 | 404 | ||
| Equity | 1,825,925 | 1,899,977 | (74,052) | ||
| Total liabilities and equity | 3,393,626 | 3,379,294 | 14,332 |
02
Market review and outlook
Q1 2025: Tonne-miles down 1.5% (y/y)
Negative tonne-miles due to weak performance from coal and grains as both volumes and distance are down
| Commodity | YTD YoY JF | YTD 2025 | Commodity | Capesize | Commodity | Panamax | Commodity | Supramax LF | Commodity | Handysize |
|---|---|---|---|---|---|---|---|---|---|---|
| Other | 220.7bn | O | Bauxite | 159.4bn | Other | 47.4bn | Other | 77.6bn | Other | 39.7bn |
| Bauxite | 185.8bn | ● | Other | 56.0bn | Bauxite | 15.4bn | Fertilisers | 22.1bn | Cement/Clinker | 2.7bn |
| Fertilisers | 31.3bn | Cement/Clinker | 3.4bn | Fertilisers | 13.1bn | Minerals | 20.6bn | Manganese ore | 2.6bn | |
| Minerals | 17.6bn | Grains | 1.7bn | Forest products | 9.4bn | Bauxite | 11.2bn | Copper ore | 1.9bn | |
| Cement/Clinker | 13.5bn | Steel products | 0.1bn | Steel products | 7.0bn | Manganese ore | 8.4bn | Aggregates | 1.2bn | |
| Scrap | 10.4bn | Minerals | -1.3bn | Cement/Clinker | 5.2bn | Scrap | 6.1bn | Scrap | 1.1bn | |
| Manganese ore | 7.8bn | Manganese ore | -3.9bn | Pet coke | 5.1bn | Copper ore | 5.8bn | Alumina | 0.9bn | |
| Copper ore | 7.7bn | Pet coke | -8.3bn | Scrap | 3.2bn | Cement/Clinker | 2.2bn | Bauxite | -0.2bn | |
| Aggregates | 1.8bn | Iron ore | -66.8bn | Iron ore | 2.9bn | Nickel ore | 2.2bn | Iron ore | -1.6bn | |
| Alumina | -0.1bn | Coal | Coal | 1.6bn | Aggregates | 0.6bn | Minerals | -2.1bn | ||
| Nickel ore | -9.0bn | Manganese ore | 0.7bn | Alumina | 0.3bn | Fertilisers | -4.0bn | |||
| Forest products | -13.3bn | 0 | Minerals | 0.4bn | Pet coke | -3.5bn | Pet coke | -6.6bn | ||
| Pet coke | -13.3bn | Aggregates | 0.1bn | Agribulks | -5.1bn | Forest products | -6.8bn | |||
| Agribulks | -18.8bn | Agribulks | -0.5bn | Forest products | -15.9bn | Nickel ore | 7.3 bn | |||
| Steel products | -25.4bn | 0 | Alumina | -1.3 bn | Steel products | -25.1bn | Steel products | -7.3bn | ||
| Iron ore | -100.5bn | Nickel ore | -3.8bn | Coal | -27.4bn | Coal | -8.0bn | |||
| Coal | 234 8 pr | Grains | Iron ore | -35.0bn | Agribulks | -13.2bn | ||||
| Grains | O | Grains | 103.6 bn | Grains | -43.6bn | |||||
| -61bn | 12bn | -51bn | -37bn | -3.4% | ||||||
| -136.7bn | -1.5% | -1.8% | 0.5% | -2.3% | ||||||
| Net Change | Percent Change | Net Change | Percent Change | Net Change | Percent Change | Net Change | Percent Change | Net Change | Percent Change |
Iron ore
Weak iron ore volume for Q1 in line with seasonality, down 1.6% from Q1 2024, and down 9.4% from Q4 2024
Iron ore exporters and importers Q1 2025
- Heavy cyclone season in Australia
- Despite rain season in Brazil volumes are up y/y
- Asia in the primary taker of iron ore which favours Capesizes tonne-miles
- Iron ore price hoovers round \$100/tonne, indicting continues strong demand for iron ore
- 2025 guiding (2024) among largest miners, indicating strong volumes 2H 2025
- Vale: 325-335 MT (328)
- Rio Tinto: 323-338 MT (328)1
- BHP: 255-265MT (260)
Significant new iron ore volumes on stream
Simandou delivered cost to China estimated to be in line with Brazil and Australia (~\$40-60/t) - Highly competitive vs domestic Chinese production cost (~\$75/t)
New projects on-stream 2025-28 Iron ore cost curve estimate (delivery China)
Bauxite
Expected increase in Guinea bauxite exports and tonne-mile could cover a significant part of the Capesize deliveries
Guinea bauxite export (MT) Guinea daily bauxite shipments (mt)
- Bauxite represents 13-15% of tonne mile demand for Capesize vessels
- Global bauxite trade reached 207 MT in 2024 (+12%) whereof 145 MT out of Guinea
- Guinea bauxite export hit record high 48.8 MT in Q1 2025 (+37% y/y)
- Volumes exceeding previous export capacity guiding, indicating improved infrastructure
- China importing 80-90% of Guinea bauxite
Supply side
Historically high orderbook visibility on Capesize fleet and ageing fleet
• 30% of Capesize > 15 years in 2025 / 50% in 2028
- 55% of fleet regarded non-ECO1 / Average age 11.5 years
- Significant drydocking next couple of years
Fleet distribution (Capesize) Capesize orderbook remains favourable
- Only 2% gross fleet growth in 2025
- Limited yard capacity pushing newbuilding orders to 2028 onwards
- Capesize remains unfavoured among large shipyards
Upside to fleet productivity
Historical low congestion and increased drydocking schedule in 2025 and 2026 will likely lower effective supply growth
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