Himalaya Shipping

Investor Presentation • Feb 15, 2024

Himalaya Shipping Ltd. - Q4 2023 Results Presentation

1

15 February 2024

DISCLAIMER

Forward Looking Statements This results presentation and any related discussions contain forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are statements that do not reflect historical facts and may be identified by words such as "aim", "believe," "assuming," "anticipate," "could", "expect", "intend," "estimate," "forecast," "project," "likely to", "plan," "potential," "will," "may," "should," "indicative," "illustrative," "potential" or other similar expressions and include statements about plans, objectives, goals, strategies, future events or performance, including outlook, prospects, contracts to acquire newbuilding vessels and associated financing agreements, illustrative free cash flow per share and earnings potential based on different scenarios and assumptions, statements about the benefits of our vessels, including the flexibility and ability to bunker with LNG, LSFO, or HSFO, the terms of our charters, dry bulk industry trends and market outlook, including activity levels in the industry, expected trends, including trends in the global fleet, expected demand for and offer of vessels and utilization of the global fleet and our fleet, including expected average rates, fleet growth, new orderings, the impact of an aging global fleet, expected trends regarding iron ore demand, demand outlook, limited supply growth of dry bulk vessels and yard capacity, replacement needs, expectations on demand, and other non-historical statements. These forward-looking statements are not statements of historical fact and are based upon current estimates, expectations, beliefs, and various assumptions, many of which are based, in turn, upon further assumptions, and a number of such assumptions are beyond our control and are difficult to predict. These statements involve significant risks, uncertainties, contingencies and factors that are difficult or impossible to predict and are beyond our control, and that may cause our actual results, performance or achievements to be materially different from what is expressed, implied or forecasted in such forward-looking statements. Numerous factors, risks and uncertainties that could cause our actual results, level of activity, performance or achievements to differ materially from those expressed, implied or forecasted in the forward-looking statements include but are not limited to: general economic, political and business conditions; general dry bulk market conditions, including fluctuations in charter hire rates and vessel values; our ability to complete the purchase of the vessels we have agreed to acquire and on schedule; our ability to meet the conditions and covenants in our financing agreements;

changes in demand in the dry bulk shipping industry, including the market for our vessels; changes in the supply of dry bulk vessels; our ability to successfully employ our dry bulk vessels and the terms of future charters; changes in our operating expenses, including fuel or bunker prices, dry docking and insurance costs; changes in governmental regulation, tax and trade matters and actions taken by regulatory authorities; compliance with, and our liabilities under governmental, tax, environmental and safety laws and regulations; potential disruption of shipping routes due to accidents or political events; our ability to procure or have access to financing and to refinance our debt as it falls due; our continued borrowing availability under our sale and leaseback agreements in connection with our vessels and compliance with the financial covenants therein; fluctuations in foreign currency exchange rates; potential conflicts of interest involving members of our board and management and our significant shareholder; our ability to pay dividends; risks related to climate change, including climate-change or greenhouse gas related legislation or regulations and the impact on our business from climate-change related physical changes or changes in weather patterns, and the potential impact of new regulations relating to climate change, as well as the performance of our vessels; other factors that may affect our financial condition, liquidity and results of operations; and other risks described under "Risk Factors" in our registration statement on Form F-1/A filed with the U.S. Securities and Exchange Commission on March 30, 2023. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Unless legally required, Himalaya Shipping undertakes no obligation to update publicly any forward-looking statements after the date of this press release whether as a result of new information, future events or otherwise, except as required by law. Non-GAAP Financial Measures This presentation contains certain selected financial measures on a basis other than U.S. generally accepted accounting principles ("GAAP"), including EBITDA, average daily TCE earnings, and

illustrative free cash flow. EBITDA represents our net income/(loss) plus depreciation of vessels and equipment; total financial expenses, net; and income tax expense. EBITDA is presented here because the Company believes this measure increases comparability of total business performance from period to period and against the performance of other companies. Average daily TCE earnings, as presented here, represents time charter revenues and voyage charter revenues adding back address commissions and divided by operational days. For a reconciliation of EBITDA and average daily TCE earnings, gross, to the most directly comparable financial measures prepared in accordance with US GAAP, please see the section of our preliminary results for the quarter ended December 31, 2023, Appendix entitled "Unaudited Non-GAAP Measures And Reconciliations". For a discussion of illustrative free cash flow see slide 15 including the footnotes thereto. We are unable to prepare a reconciliation of illustrative free cash flow without unreasonable efforts.

Highlights

Q4 2023 Highlights:

• All delivered vessels generated total operating revenues of \$18.3 million, an average time charter equivalent earnings of approximately US\$34,400/day, gross.
• Net income of \$4.5 million and EBITDA of \$13.4 million for the quarter ended December 31, 2023.
• Secured time charter agreements for the three remaining uncontracted vessels for 24 months' time charters with an evergreen structure to commence in the first half of 2024, at an index-linked rate reflecting a significant premium to the Baltic 5TC index (BCI).
• Extended index linked time charters for six of our vessels by an additional year, until the end of 2026.
• Converted index linked charters to fixed rate charters for 5 vessels for varying periods from December 1, 2023 to March 31, 2024. Two vessels will earn a fixed scrubber premium of \$2,500 per day from December 1, 2023, to March 31, 2024. The remaining three vessels will continue to earn scrubber premium according to the terms of the existing time charter agreements. • Successful delivery and commencement of operations of three additional Newcastlemax dual fuel newbuildings. • Final instalments for three delivered vessels financed by sale and leaseback facilities totalling \$147.8 million. • Conversion of index linked charters on Mount Bandeira and Mount Hua to fixed charters from February 1, 2024 to June 30, 2024 at an average rate
• Completion of Private Placement in December 2023, raising net equity proceeds of approximately \$17.0 million.

Subsequent events:

-

• of \$26,866. They will continue to earn scrubber premium according to the terms of their existing time charter agreements.
• Declaration of cash distribution for January 2024 of \$0.01 per common share.

Key Financials Q4 2023

Key Financials Q4 2023 Income statement				Comments
US\$ millions, except per share data	Q4 2023	Q3 2023	Variance
				vessels operating for the full quarter and increase in average time charter equivalent earnings, gross. Average TCE earnings of
Operating revenues	18.3	10.2	8.1	approx. US\$34,400/day in Q4 2023 vs \$22,300/day in Q3 2023.
Vessel operating expenses	(3.6)	(3.0)	(0.6)
Voyage expenses and commission General and administrative	(0.2)	(0.2)	-	day.
expenses	(1.1)	(0.9)	(0.2)
Depreciation and amortization	(3.6)	(3.2)	(0.4)	• Increase in vessel operating expenses of \$0.6 million in Q4 2023
Total operating expenses	(8.5)	(7.3)	(1.2)	due to 6 vessels operating for the full quarter .
Operating profit	9.8	2.9	6.9	Q4 2023.
Interest expense	(5.6)	(5.0)	(0.6)
Other financial items	0.4	0.1	0.3	• Increase in Interest expense by \$0.6 million in Q4 2023 due to
Total financial expense, net	(5.2)	(4.9)	(0.4)	vessels, net of interest capitalized.
Tax expense	-	-	-	• EBITDA of \$13.4 million in Q4 2023, an increase of \$7.3 million over Q3 2023.
Net income (loss)	4.6	(2.0)	6.6	• Increase in operating profit by \$6.9 million in Q4 2023.
Earnings per share	0.11	(0.05)		•
EBITDA	13.4	6.1	7.3	Net income of \$4.6 million in Q4 2023 vs a net loss of \$2.0 million in Q3 2023.

• Increase in operating revenues of \$8.1 million in Q4 2023, due to 6 vessels operating for the full quarter and increase in average time charter equivalent earnings, gross. Average TCE earnings of approx. US\$34,400/day in Q4 2023 vs \$22,300/day in Q3 2023.
• Cash break-even TCE estimated to be approximately \$24,600 per day.
• Increase in vessel operating expenses of \$0.6 million in Q4 2023 due to 6 vessels operating for the full quarter .
• General and administrative expenses increased by \$0.2 million in Q4 2023.
• Increase in Interest expense by \$0.6 million in Q4 2023 due to interest for the full quarter on the sale & leaseback financing for 6 vessels, net of interest capitalized.
• EBITDA of \$13.4 million in Q4 2023, an increase of \$7.3 million over Q3 2023.
• Increase in operating profit by \$6.9 million in Q4 2023.
• Net income of \$4.6 million in Q4 2023 vs a net loss of \$2.0 million in Q3 2023.

Key Financials Q4 2023

Key Financials Q4 2023
	Balance Sheet Summary		Comments
US\$ millions	December 31, 2023	September 30, 2023	Variance	• Net cash generated by operating activities in Q4 2023 of \$8.4 million. • Net cash used in investing activities in Q4 2023 was \$28.9 million,
				primarily consisting of \$20.7 million used for installment payments of the January 2024 vessel deliveries which was paid in advance.
Cash and cash equivalents	25.6	12.8	12.8	• Net cash provided by financing activities in Q4 2023 was \$33.3 of
Vessels and equipment	428.6	432.3	(3.7)	and \$20.7 million was from pre-delivery financing on newbuilding
Newbuildings	132.6	108.8	23.8	instalments, partially offset by loan repayments of \$3.4 million;
Total assets	604.4	560.4	44.0	• Increase in newbuildings was mainly due to \$20.7 million for instalment payments on the newbuildings
Long-term debt	439.5	421.9	17.6
Total equity	159.4	132.6	26.8	• Increase in long-term debt was mainly due to pre-delivery

• Net cash generated by operating activities in Q4 2023 of \$8.4 million.
• Net cash used in investing activities in Q4 2023 was \$28.9 million, primarily consisting of \$20.7 million used for installment payments on the newbuildings and \$5.1 million used on the charterer's portion of the January 2024 vessel deliveries which was paid in advance. • Net cash provided by financing activities in Q4 2023 was \$33.3 of
• which \$16.0 million was from the December 2023 Private Placement and \$20.7 million was from pre-delivery financing on newbuilding instalments, partially offset by loan repayments of \$3.4 million;
• Increase in newbuildings was mainly due to \$20.7 million for instalment payments on the newbuildings
• Increase in long-term debt was mainly due to pre-delivery financing of \$20.7 million on newbuilding instalments, offset by loan repayments.
• Total remaining shipyard capex (including scrubbers) of \$306.0 million. Current committed sale lease-back financing of \$295.5 million.
• \$10 million available to draw-down under the RCF with Drew Holdings Ltd.

Contract overview

		AVA					Himalaya Shipping
S H	P P	N G					Fleet Status Report
Vessel Name	Built				2024				2025					2026					2027
		Type	Q1	Q2	Q3	Q4	Q1		Q2	Q3 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------	Q4	Q1	Q2	Q3	Q4 ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------	Q1		Q2		Q3	Q4
										Dual Fuel Newcastlemax
Mount Norefjell	2023	DF Newcastlemax			30,000		D
Mount Ita	2023	DF Newcastlemax					Index
Mount Etna	2023	DF Newcastlemax	25,600							Index
Mount Blanc	2023	DF Newcastlemax	24,325*							Index
Mount Matterhorn	2023	DF Newcastlemax					Index
Mont Neblina	2023	DF Newcastlemax	25,600							Index
Mount Bandeira	2024	DF Newcastlemax		28,350*						Index
Mount Hua	2024	DF Newcastlemax		25,382.5*						Index
Mount Elbrus	2024	DF Newcastlemax					Index
Mount Denali	2024	DF Newcastlemax								Index
Mount Acancagua	2024	DF Newcastlemax						Index
Mount Emai	2024	DF Newcastlemax						Index
				Option			Available					Under Construction			C> Evergreen		* + Scrubber

Strong demand

Capesize tonne-mile demand growth of 4% in 2023 Capesize tonne-mile demand growth of 10.8% in January 2024 Capesize Panamax Supramax Handysize Capesize Panamax Supramax Handysize

Iron ore	82 3bn	Other	17.5bn	Other	43.7bn	Other	29.7bn
Other	18.3bn	Fertilisers	15.7bn	Steel products	25.4bn	Grains	8.8bn
Pet coke	5.2bn	Iron ore	4.9bn	Iron ore	15.0bn	Steel products	8.7bn
Bauxite	3.8bn	Steel products	3.6bn	Minerals	5.4bn	Cement/Clinker	2.6bn
Manganese ore	3.1bn	Agribulks	2.4bn	Cement/Clinker	4.2bn	Coal	1.3bn
Cement/Clinker	1.7bn	Nickel ore	1.1bn	Forest products	1.7bn	Copper ore	1.1bn
Steel products	0.2bn	Alumina	0.9bri	Scrap	1.0bn	Iron ore	0.9bn
Minerals	-0.4bn	Grains	0.7bri	Bauxite	-0.7bn	Alumina	0.2bn
Grains	-0.6bn	Aggregates	0.4bn	Copper ore	-1.5bn	Fertilisers	-0.1bn
Coal	-3.5bn	Scrap	-0.4bn	Alumina	-1.7bn	Nickel ore	-0.4bn
		Forest products	-0.7bn	Aggregates	-2.2bn	Bauxite	-0.5bn
		Minerals	-0.9bn	Pet coke	-2.4bn	Manganese ore	-0.5bn
		Bauxite	-1.1bn	Grains	-2.4bn	Agribulks	-1.1bn
		Cement/Clinker	-1.7bn	Nickel ore	-3.7bn	Pet coke	-1.3bn
		Manganese ore	-2.Obn	Manganese ore	-5.7bn	Scrap	-1.9bn
		Pet coke	-4.7bn	Agribulks	-8.1bn	Aggregates	-2.4bn
		Coal	-8.9bn	Fertilisers	-9.4bn	Minerals	-3.2bn
				Coal	-13.3bn	Forest products	-4.1bn

Strong demand outlook

Significant iron ore production growth in

the Atlantic basin Required ships if transported to China1 Incremental iron ore production (MT/year) from these 2 projects

1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 Active Shipyards, Total No. Active Shipyards, Global 20,000+ dwt 25 year low orderbook Significant reduction in yard capacity (59%) 2000 2003 2006 2009 2012 2015 2018 2021 Capesize fleet DWT Capesize orderbook DWT Orderbook 5.7% of fleet

Source: Clarksons Shipping Intelligence Network (https://sin.clarksons.net/)

The right timing

Significant replacement needs

Unlikely to be able to build significant capacity before

2028

60% of the fleet >20 years by 2033

Capesize+ fleet by delivery year in # ships

The right ships

43% more CO2 efficient than a standard Capesize1

Dual fuel gives flexibility

		Himalaya have fuel flexibility –			can run on LNG, HFO or VLSFO
				as the cheapest fuel option	Current LNG prices (12 Feb 2024) quoted by Affinity Shipbrokers

Current LNG prices (12 Feb 2024) quoted by Affinity Shipbrokers as the cheapest fuel option

LNG bunkering operations on Mount Matterhorn

The right ships

Fuel flexibility unlocking premium potential vs. conventional vessels

Shipping is able to achieve in contracts entered into, including the variable scrubber earnings. Source: Clarksons Shipping Intelligence Network (https://sin.clarksons.net/) as of January 26, 2023, Bloomberg and Company estimates

The right financing

~ 15,100

Illustrative free cash-flow per share1

1) This information has been prepared for illustrative purposes only and does not represent the Company's forecast. It is based, among other things, on industry data, internal data and estimates of the Company and is inherently subject to risk \$/FCF per share2 based on BCI5 Index rates 0.0 0.7 1.4 2.1 2.8 3.5 4.2 4.9 5.7 15,100 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 \$/share FCF per year BCI5 Index rate

and uncertainties. Actual results may differ materially from the assumptions and circumstances reflected in the above illustrative financial information.

2) Assumes BCI5 Index rates + 42% premium + \$3,100 in scrubber benefit less \$24,540/d in cash breakeven x 12 ships, divided on 43,900,000 shares outstanding