Hunter Group ASA - First Quarter Results 2020

28 May 2020

Financial highlights Total revenues of USD 20.78m
• Spot pool revenues of USD 19.93m
• Time charter revenues of USD 0.85m Total operating expenses of USD 5.35m
• Vessel opex incl. insurance of USD 1.92m
• Voyage exp. and commissions of USD 0.59m
• G&A expenses of 0.30m
    - USD 0.25m administrative expenses
    - USD 0.02m legal expenses
    - USD 0.03m non-cash expenses
EBITDA of USD 18.00m
Net profit of USD 11.77m

Average daily earnings of USD 72,030

• Average spot earnings of USD 72,010[\1\]
• Time charter earnings of USD 72,500

Opex incl. insurance of USD 6,420 per day

Available earnings days and operating days of approx. 289 and 299, respectively

• Approx. 277 pool spot days
• Approx. 12 time charter days

USD 77m of yard payments of were made during the quarter, leaving USD 192m of remaining yard obligations as of 31 March 2020

Key events in Q1 2020
Successfully took delivery of Hunter Freya on 6 March 2020, which subsequently entered the Tankers International Scrubber Pool on 16 March 2020. Construction on the Company’s remaining three newbuilds is proceeding as planned, with deliveries scheduled for June-August

Secured a USD 220m loan facility from a syndicate of banks consisting of Danske Bank, DNB, Nordea and SEB (the “Syndicate”). The proceeds will be used to fund the final yard instalments for the Company's four final newbuild VLCCs, as well as general corporate purposes, and will be drawn on delivery of each vessel. The facility carries a 275bps margin over LIBOR and has a 16 year repayment profile. USD 55m was drawn in connection with the delivery of Hunter FreyaFixed a substantial portion of our fleet on 5-9 month time charters (“TC”) with dayrates ranging from USD 72,500 to USD 85,000, adding a total TC backlog of close to USD 60m. Hunter Atla and Hunter Laga commenced their TCs in late March and early April, respectively. Hunter Disen and Hunter Idun will commence their TCs immediately following delivery from the yard. Hunter Freya missed her TC delivery window due to port delays and is still in the Tankers International Scrubber pool

Subsequent events
The Company and the Syndicate has agreed on indicative terms relating to a loan facility for Hunter Atla, Hunter Saga and Hunter Laga, which are currently financed through a sale-and-leaseback with SFL Corporation Ltd. Upon completion, will Hunter Tankers AS will become the registered owner of all seven vessels. The facility is an accordion feature of the USD 220m loan facility, and is subject to the Syndicate members’ respective credit approvals

• On a fully delivered basis following the refinancing, we expect run rate cash breakeven to come in at USD approx. 20,500[\2\] per day

As of the date of this report, 89% of days in the second quarter have been booked at an average est. dayrate of USD 85,850-76% of spot days booked at an avg. est. dayrate of USD 97,630[\1\]

• Average Q2 TC dayrates of USD 78,000

1) Discharge to discharge basis
2) Assumes current LIBOR of 36.9bps

Hunter Group ASA - press release