Belships

Earnings Release • Oct 26, 2018

Belships ASA : Report 3rd quarter 2018

Belships ASA : Report 3rd quarter 2018

HIGHLIGHTS

· Operating income of USD 8.3 m (Q2: USD 8.3 m)

· EBITDA of USD 3.2 m (USD 3.5 m)

· No impairment/impairment reversal

· Net result of USD 0.6 m (USD 0.9 m)

· Average TC-income (net) per ship per day Q3: USD 13 400 (Q2: 13 250)

· All ships operating normally - modern fleet - average age 5.2 years

· Contract coverage 100% for delivered ships - around USD 38 million fixed

charter backlog

· The merger plan to be approved by the Extraordinary General Meeting

3rd quarter 2018 results

Belships operating income in 3rd quarter 2018 was USD 8.3 million (Q2: USD 8.3

million), while EBITDA amounted to USD 3.2 million (USD 3.5 million). The

Group's operating result amounted to USD 1.8 million (USD 2.1 million), while

net result for 3rd quarter 2018 was USD 0.6 million (USD 0.9 million).

Fleet status

Belships concentrates on the dry bulk market, with 6 modern Supramax/Ultramax in

service.

M/V Belstar, M/V Belnor and M/V 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/V Belforest, M/V Belocean and M/V Belnippon are all

on time charter to Cargill. In September the c/p's with Cargill for M/V

Belforest and M/V Belocean were extended until August and October 2019 at USD

13,500 and USD 12,000 daily respectively. Next open position will then be M/V

Belnippon in February 2019.

All ships have sailed without significant off-hire. Technical management is

handled by Belships Management (Singapore), with a total fleet of 10 ships under

technical management.

Newbuilding program

Belships' remaining newbuilding program with Imabari Shipbuilding in Japan

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

in agreement incl. purchase option for delivery within first half 2020.

Financial and corporate matters

As per 30 September the Group's cash totaled USD 5.3 million, which is unchanged

from 30 June.

The mortgage debt as per 30 September was USD 24.5 million. Net lease obligation

as at 30 June was USD 41.2 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 the 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 60%.

At the end of the 3rd quarter of 2018, the book value per share amounted to NOK

5.07 (USD 0.62), while the equity ratio was 29.6 %. 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 18 350 per day, whereas the

Kamsarmax-index ended at USD 15 351 per day. The Supramax-index ended the

quarter at USD 13 273 per day. As per today the Cape index stands at USD 18 683

per day, Kamsarmax-index at USD 16 110 per day and Supramax-index at USD 13 319

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

USD 18.5 million.

Outlook

After a slow start due to Chinese holidays, the Supramax market has risen

slightly in October. There is more interest for period deals and for Far East

delivery fixtures around USD 13-14,000 per day have been reported.

Belships' ships are fully covered until February 2019 when M/V Belnippon becomes

open. The company is well positioned for a dry bulk market that we believe will

be strengthening in 2019-20.

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

representing a future nominal gross hire of around USD 38 million.

Focus remains to continue developing Belships as an owner and operator of modern

bulk carriers to reputable counterparts, building a portfolio of quality ships

and robust charter parties that will generate distributable cash flows.

In today's Extraordinary General Meeting the merger with Lighthouse is expected

to be approved. The Board of Directors believes this transaction will be in the

best interest of all the shareholders and the company.

Following this transaction the combined entity will control a fleet of 16 dry

bulk carriers and enhance its earnings potential with a combination of charter

backlog and spot exposure. Complementing management activities create a complete

in-house operational structure, ideally positioning Belships as a platform for

further growth. The company will concentrate on the dry bulk market and expect

to benefit from a fully in-house commercial and technical management.

26 October 2018

THE BOARD OF BELSHIPS ASA

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.