Belships

Earnings Release • Apr 25, 2017

Belships ASA : Report 1st quarter 2017

Belships ASA : Report 1st quarter 2017

HIGHLIGHTS

· Operating income of USD 6.6 m (Q4 2016: USD 6.6 m)

· EBITDA of USD 3.0 m (USD 3.1 m)

· Net result of USD 0.8 m (USD 1.2 m)

· All ships operating normally - modern fleet - average age 4.7 years

· Contract coverage 100% for delivered ships - around USD 58 million fixed

charter

First quarter 2017 results

Belships operating income in 1st quarter 2017 was USD 6.6 million (Q4 2016: USD

6.6 million), while EBITDA amounted to USD 3.0 million (USD 3.1 million). The

Group's operating result amounted to USD 2.1 million (USD 2.4 million), while

net result for 1st quarter 2017 was USD 0.8 million (USD 1.2 million).

Fleet status

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 Belocean and M/S Belforest are both on time charter

to Cargill. M/S Belocean is open in May 2017, whereas M/S Belforest will be open

in September 2017. 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.

Financial and corporate matters

As per 31 March the Group's cash totaled USD 7.7 million compared to USD 7.9

million as per 31 December 2016.

The mortgage debt as per 31 March was USD 35.0 million. Net lease obligation as

at 31 March was USD 44.2 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 1st 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 80%

(leases not included).

At the end of the 1st quarter of 2017, the book value per share amounted to NOK

3.83 (USD 0.45), while the equity ratio was 20.0%. 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 first quarter at USD 18,864 per day, whereas the

Panamax-index ended at USD 11,025 per day. The Supramax-index ended the quarter

at USD 9,760 per day. As per today the Cape index stands at USD 15,524 per day,

Panamax-index at USD 12,916 per day and Supramax-index at USD 10,088 per day.

Following the Chinese New Year celebration in February, the spot market rates as

well as ship values have increased. Baltic S&P Assessment's valuation of a 5-

year old Supramax is now USD 16.7 million, up from USD 13.6 million at the

beginning of the year.

China GDP-growth has picked up for the second-straight quarter to 6.9%

annualized, on the back of increased activity in real estate, infrastructure

projects and export. The year-on-year growth in total power production is 6.7%,

with thermal coal being the dominant energy source. The imported volume of high

grade coal from Australia and Indonesia has increased substantially, giving

vital support to the dry bulk market.

Strategy

Belships concentrates on the dry bulk market, with 5 x modern Supramax/Ultramax

in service. In addition, a 63,000 dwt Ultramax is scheduled for delivery from

Imabari Shipbuilding in January 2018 for long-term timecharter incl. purchase

option.

Outlook

Iron ore import to China in 2017 is expected to grow only moderately from

current level of about 1 bn tons, but the imported volumes of coal may surprise

on the upside. Import of grain products to China is also expected to grow. The

prognosis for the aggregate dry bulk market in 2017 is a growth in seaborne

trade in the region of 2.0-2.5%.

Ordering of new ships is still very limited, but the scrapping activity has also

slowed on the back of the improved market rates. Fearnresearch believes that the

net growth in tonnage supply during 2017-2020 will be very limited following

IMO's new regulations for ballast water treatment systems and scrubbers

gradually to be installed on all vessels.

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

representing a future nominal gross hire of around USD 58 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, 25 April 2017

THE BOARD OF BELSHIPS ASA

For any questions, please contact CEO Ulrich Müller, phone no. +47 22 52 76 15.

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.