Acquisition - BW LPG Limited successfully completed the acquisition of 12 VLGCs from Avance Gas, with the final vessel BW Avior delivered[4] Reporting - The company is filing its reports under Form 20-F for the fiscal year ending December 2024[3] - The report was signed by Chief Financial Officer Samantha Xu on December 31, 2024[7] Location - The principal executive office is located in Singapore at Mapletree Business City[2]

Revenue and Financial Performance - In 2024, 80.3% of the Group's revenue from LPG shipping was generated based on spot prices, while 19.7% was from time charters[69]. - The Group's revenue and profitability are subject to the cyclical nature of the LPG shipping industry, which can lead to volatility in results[69]. - Revenue from Product Services reached US$2,600.9 million in 2024, supporting the core shipping business by providing integrated LPG delivery services[247]. - In 2024, 80.3% of Revenue — Shipping, totaling US$773.0 million, was derived from spot voyages, while 19.7% or US$189.8 million came from time charters[246]. - The Group's top five shipping customers accounted for 40.8% of its revenue in 2024, highlighting a significant reliance on a limited customer base[116]. Market and Economic Conditions - The Group's growth is dependent on the continued growth of the global LPG market, which may be adversely affected by various factors[87]. - Increased trade protectionism and tariffs could significantly impact global trade and the shipping industry, potentially leading to reduced demand for shipping services[72]. - Adverse global economic conditions could materially affect the Group's business, financial condition, and results of operations, particularly in LPG consuming regions[89]. - Geopolitical events, such as the war in Ukraine, continue to disrupt energy production and trade patterns, affecting LPG carrier rates and operational costs[77]. - The COVID-19 pandemic has introduced uncertainty in operational and financial activities, negatively impacting demand for LPG and shipping services[84]. Operational Risks and Challenges - The Group faces risks related to climate change, which could lead to increased operational costs and regulatory compliance challenges[83]. - An oversupply of LPG shipping capacity may adversely affect freight rates, impacting the Group's financial condition and results of operations[86]. - The Group's international operations face risks from piracy, geopolitical tensions, and sanctions, which could increase operational costs and impact financial performance[98]. - The Group's operational challenges, including mechanical risks and reliance on timely supply deliveries, could adversely affect revenue and increase costs[127]. - The Group's vessels are currently enrolled with multiple classification societies, including DNV and Lloyds Register, ensuring compliance with safety and seaworthiness standards[130]. Competition and Market Position - The Group faces intense competition in the LPG shipping market, which may hinder its ability to secure new charter agreements and maintain profitability[106]. - The Group's business is heavily dependent on the maritime LPG transportation sector, making it vulnerable to adverse developments in this specific market[112]. - The Group's charter hire income and vessel values may be negatively impacted by competition from more technologically advanced LPG carriers[108]. Capital Expenditures and Investments - The Group's capital expenditure for drydocking is projected to be $5.0 million for 2024 and $59.2 million for 2025, indicating a substantial investment in fleet maintenance[110]. - The Group's capital expenditures for drydockings, vessel maintenance, retrofitting dual-fuel LPG engines, and second-hand vessel purchases totaled US$1,064 million, US$116 million, and US$46 million for the years ended December 31, 2024, 2023, and 2022, respectively[222]. - In August 2024, the Group entered into agreements to acquire 12 VLGCs for a total consideration of US$1,050 million, increasing the owned fleet by more than 40%[221]. - The Group signed a joint venture agreement in November 2023, committing to invest approximately US$40 million in an LPG onshore import terminal[218]. Environmental and Regulatory Factors - Sustainability pressures from investors and lenders may impose additional costs and affect the Group's access to capital[80]. - Changes in governmental regulations could impact the attractiveness of LPG consumption compared to other energy sources[88]. - The Group's compliance with the Maritime Labour Convention is crucial, as non-compliance could lead to legal and operational risks[139]. Financial Management and Governance - The Group's management regularly reviews its business strategy with the Board of Directors to ensure effective growth management[105]. - The Group's existing credit facilities impose financial covenants that may limit its ability to operate, incur additional indebtedness, or pay dividends[178]. - The Group has identified material weaknesses in its internal control over financial reporting, which could lead to material misstatements in financial statements[187]. - The Group's management is implementing a plan to remediate identified material weaknesses, including recruiting qualified personnel[189]. Tax and Financial Obligations - The Group faces potential tax challenges that could increase its effective tax rate, negatively impacting earnings and cash flows[161]. - Changes in international tax laws, including the implementation of BEPS 2.0, could result in higher tax expenses for the Group[163]. - The Group expects to qualify for tax exemptions under Section 883 of the Code, but any changes could subject it to a 2% US federal income tax on gross shipping income, affecting its ability to pay dividends[171]. - The Group relies on cash flow from subsidiaries to meet obligations and pay dividends to shareholders[172]. Strategic Focus and Future Outlook - The Group's strategy focuses on operational excellence and exploring growth opportunities within the LPG shipping and adjacent value chain areas[104]. - The Group aims to explore growth opportunities along the LPG value chain, including expanding its Product Services and enhancing operational excellence[258][261]. - Product Services' profitability relies on identifying arbitrage opportunities in the fragmented and volatile LPG market, which can be influenced by pricing discrepancies across locations[151].

Financial Data and Key Metrics Changes - The total charter income per available day ended at $37,900, which is lower than the previous quarter but above the guidance of $36,000 per day [3][4] - The company reported a net profit after tax of $40 million in Q4, with profit attributable to equity holders of $31 million, translating to an earnings per share of $0.22 [26][28] - The net leverage ratio increased to 33% in Q4 from 12% in Q3, primarily due to additional borrowings for fleet financing [27][28] Business Line Data and Key Metrics Changes - The product services segment achieved a gross profit of $50 million, including a realized profit of $59 million from trading activities [23][24] - The time charter portfolio constituted 38% of total shipping exposure, supporting earnings when the spot market softened [21][22] - The average value at risk for product services was $7 million, reflecting a well-balanced trading book [25] Market Data and Key Metrics Changes - Spot market rates fluctuated between $35,000 and $40,000 per day, with current rates hovering around mid $20,000 per day from the Middle East and U.S. Gulf [3][9] - The VLGC market fundamentals are positive, with expectations of increased U.S. exports due to terminal expansions [12][15] - The overall LPG export capacity is projected to increase by about 45% by 2028, with North America specifically seeing a 66% increase [16] Company Strategy and Development Direction - The company aims to maintain a solid time charter ratio to mitigate spot market volatility [8][21] - There is a focus on expanding product services to stabilize and enhance returns to shareholders [28] - The company is closely monitoring geopolitical and regulatory developments to optimize its position [10][44] Management Comments on Operating Environment and Future Outlook - Management noted that the VLGC market is currently experiencing a seasonal trough but anticipates increased volumes from the U.S. in the upcoming months [9][14] - The geopolitical landscape is affecting global trade patterns, which in turn impacts the shipping industry [90] - The company is optimistic about the growth prospects in the Indian LPG market and is actively participating in that sector [94] Other Important Information - The board declared a dividend of $0.42 per share, representing a 123% payout ratio of total shipping impact for the year [4][28] - The company ended 2024 with a liquidity position of $603 million, supported by $232 million in cash [31] Q&A Session Summary Question: Financing strategy related to new ships and dividend payouts - Management explained that share issuance was used as a currency during the Avance Gas transaction and clarified that dividends are paid from product services results, not exceeding earnings [35][38] Question: Impact of U.S. tariffs on LPG trade with China - Management stated that there are currently no tariffs on LPG and emphasized the importance of monitoring developments closely [43][44] Question: Share buyback plans - Management confirmed that a share buyback program is under consideration and may be activated when deemed appropriate [47] Question: Strategy for reducing debt ratio - Management indicated that the current leverage ratio is healthy and that cash flow will be used to gradually pay down debt while also returning value to shareholders [50][51] Question: Governance role of Avance Gas - Management clarified that Avance Gas has divested most of its shares in BW LPG and there are no plans for increased governance involvement [80] Question: Upcoming CapEx in Q1 and FY '25 - Management noted that CapEx will primarily reflect dry docking programs, estimated at approximately $4,000 per day for 2025 [83] Question: Global perception of the shipping industry - Management attributed low price-to-earnings multiples to earnings volatility and emphasized the company's strategy to mitigate this through time charters and diversification into adjacent value chains [88][89]

Industry Overview - Capital Link released a comprehensive booklet titled "SHIPPING: STATE OF PLAY & WHAT LIES AHEAD," summarizing key insights from the 2024 Shipping Sector Webinar Series held in December 2024 [2] - The booklet focuses on six main sectors: Dry Bulk, Containers, Crude Tankers, Product Tankers, LNG, and LPG, providing analysis of trends shaping the future of global shipping [3] - The guide highlights potential trade policy changes, geopolitical risks, key trade rerouting, and environmental regulations, with more changes anticipated for 2025 [3] Key Sectors and Trends - The Dry Bulk Shipping Sector webinar was moderated by Mr Gregory Lewis, Head of Maritime Research at BTIG, with panelists including CEOs and executives from EuroDry Ltd, Golden Ocean Group Ltd, and Safe Bulkers Inc [6][8] - The Container Shipping Sector webinar was moderated by Ms Muneeba Kayani, Managing Director at Bank of America Global Research, with panelists from Danaos Corporation, Euroseas Ltd, and Global Ship Lease Inc [6][8] - The Product Tanker Shipping Sector webinar was moderated by Mr Jorgen Lian, Head of Shipping Equity Research at DNB Markets, with panelists including CEOs from d'Amico International Shipping S A and Hafnia Ltd [9][12] - The Crude Tankers Shipping Sector webinar was moderated by Mr Nils Thommesen, Deputy Head of Research at Fearnley Securities, with panelists from International Seaways Inc and Scorpio Tankers Inc [9][12] - The LNG Shipping Sector webinar was moderated by Mr Liam Burke, Managing Director at B Riley Securities, with panelists including CEOs from Capital Clean Energy Carriers Corp and FLEX LNG Ltd [9][12] - The LPG Shipping Sector webinar was moderated by Mr Fredrik Dybwad, Senior Shipping Analyst at Fearnley Securities, with panelists from BW LPG Ltd and Dorian LPG Ltd [9][12] Expert Insights and Strategies - The booklet provides cutting-edge insights into the strategies and market moves driving the evolution of the shipping industry [7] - It features expert voices from leading shipowners, a major stakeholder group in the global supply chain [7] - Sector spotlights dive deep into key segments, offering a detailed look at what's next for the industry [7] Access and Participation - The booklet is a resource for investors, industry professionals, and stakeholders seeking a deeper understanding of the dynamics driving the maritime industry [4] - Complimentary PDF copies of the booklet and access to webinar replays are available on the Capital Link website [5] - The webinars feature leadership insights from senior executives of publicly listed shipping companies, providing a comprehensive analysis of industry trends [2][6]

Financial Data and Key Metrics Changes - Time Charter income per available day was $46,800, slightly lower than the previous quarter but above the guidance of $43,000 per day [3] - The net profit after tax for Q3 was $120 million, with profit attributed to equity holders of the company at $105 million, translating to an earnings per share of $0.79 [21][22] - The net leverage ratio increased to 21% in Q3 from 12% at the end of June, primarily due to short-term trade finance and margin requirements [22][23] Business Line Data and Key Metrics Changes - Product Services reported a net profit of $58 million, driven by gross profits of $71 million, which included an unrealized mark-to-market gain of $86 million [18][21] - The Time Charter and FFA portfolio represented about 45% of the shipping exposure, with 90% of available days fixed at approximately $36,000 per day for Q4 [17] Market Data and Key Metrics Changes - The VLGC market experienced significant volatility, with freight rates fluctuating between low $20,000 and $50,000 per day [4] - The market outlook for Q4 and next year is positive, with US Gulf export levels stabilizing and freight rates finding an equilibrium around $40,000 per day [8][10] Company Strategy and Development Direction - The company is focused on expanding its fleet, with five out of twelve acquired Avance Gas ships delivered and plans for further deliveries [4][27] - The company aims to maintain a healthy leverage and financing structure while evaluating refinancing options for vessels in early 2025 [27][28] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the market fundamentals, highlighting the expected increase in North American export capacity and growth in Middle Eastern export volumes [10][11] - The company anticipates greater volatility in unrealized positions in future quarters due to the nature of their trading activities [20] Other Important Information - The Board declared a dividend of $0.42 per share, representing a 100% payout of shipping NPAT [5][24] - The company ended the quarter with a strong liquidity position of $750 million, expected to remain healthy post-delivery of the Avance Gas fleet [26][27] Q&A Session Summary Question: Cost and revenue timing for Avance vessels - Management indicated that costs for the ships will be incurred before revenues, as invoicing occurs post-voyage completion [32] Question: Impact of asset market prices on new acquisitions - Management noted that the asset market for new ships has remained stable over the past six to eight months [38] Question: Adjustments to net leverage ratio and dividend policy - Management confirmed that the dividend policy remains unchanged, with the Board having the final say on declarations [44] Question: Product Services performance in current market conditions - Management acknowledged the challenges in extracting value due to fluctuating rates but emphasized the diverse strategies available to the Product Services division [68] Question: Guidance on G&A and depreciation - Management explained that G&A expenses fluctuate based on accrued bonuses and that depreciation will increase with the acquisition of new vessels [71][74]

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