Himalaya Shipping .(HSHP) - 2023 Q2 - Quarterly Report

Financial Performance - Total operating revenues for the six months ended June 30, 2023, were $8.2 million, a 100% increase compared to $0 in the same period in 2022[23] - EBITDA improved by $5.2 million to $4.2 million for the six months ended June 30, 2023, compared to a loss of $1.0 million in the same period in 2022[36] - The company reported a net loss attributable to shareholders of $1.1 million for the six months ended June 30, 2023, compared to a loss of $1.0 million in the same period in 2022[69] - The company reported a net loss of $1.1 million for the three months ended June 30, 2023, compared to a net loss of $0.6 million for the same period in 2022[74] - For the three months ended June 30, 2023, the net loss was $1.1 million, compared to a net loss of $0.6 million for the same period in 2022, reflecting an increase in losses of approximately 83.3%[113] - Basic and diluted loss per share for the three months ended June 30, 2023, was $(0.03), consistent with the loss per share for the same period in 2022[112] Revenue and Expenses - Time charter revenue increased by $8.2 million or 100%, with vessels earning an average daily time charter equivalent (TCE) of $25,700/day over 330 operational days[24][26] - Vessel operating expenses rose by $2.0 million or 100%, with an average vessel operating expense of $6,200 per day for the six months ended June 30, 2023[28] - General and administrative expenses increased by $0.8 million or 80%, primarily due to higher administrative costs following the company's IPO[30] - Time charter revenues for the six months ended June 30, 2023, amounted to $8.2 million, with $4.8 million generated from index-linked charters[115] - Interest expense for the three months ended June 30, 2023, was $4.7 million, significantly higher than $0.3 million for the same period in 2022, indicating a substantial increase in financing costs[114] Capital and Financing Activities - The company completed its IPO in April 2023, raising gross proceeds of $50.0 million, with net proceeds of $44.9 million used for corporate purposes[38] - The company raised $44.9 million in net proceeds from its IPO in April 2023, issuing 8,630,000 common shares at $5.80 per share[60] - The company drew $20.6 million in financing for scheduled pre-delivery installments, compared to $6.8 million in 2022, with a balance of $41.2 million as of June 30, 2023[49] - The company has drawn $247.6 million in sale leaseback financing for newbuildings in the six months ended June 30, 2023, compared to $74.9 million in the same period of 2022, indicating a significant increase in financing activities[121] - The company drew $200.0 million in the six months ended June 30, 2023, compared to $27.2 million in 2022, to pay scheduled delivery installments for newbuildings[131] Assets and Liabilities - As of June 30, 2023, total assets increased to $459.8 million from $177.8 million as of December 31, 2022, representing a growth of 158%[72] - Cash and cash equivalents rose to $24.2 million from $0.3 million, a significant increase of 8,033%[76] - Total liabilities increased to $325.4 million from $87.5 million, marking a rise of 271%[72] - Shareholders' equity improved to $134.4 million from $90.3 million, an increase of 49%[72] - As of June 30, 2023, total debt net of deferred finance charges increased to $305.9 million from $67.5 million as of December 31, 2022, reflecting a significant rise in long-term debt[125] Fleet and Operations - The company took delivery of the fifth newbuilding vessel, "Mount Matterhorn," in July 2023, expanding its fleet to five operational vessels[19] - LNG bunkering operations were successfully completed for the vessels "Mount Norefjell" and "Mount Matterhorn" in July 2023[20] - The company has agreements to acquire eight dual-fueled Newcastlemax dry bulk vessels, expected to be delivered by July 2024[81] - The company has eight vessels under construction, with a total cost of $19.2 million for the installation of exhaust gas cleaning systems[147] - The remaining contracted installments payable on delivery to New Times Shipyard as of June 30, 2023, are approximately $441.5 million, highlighting ongoing commitments for newbuildings[122] Financing Arrangements - The company has entered into sale leaseback financing arrangements with AVIC and CCBFL for its newbuildings, with significant financing amounts secured for vessel acquisitions[41][47] - The average bareboat rate per day under sale leaseback arrangements is $16,567, with payments made quarterly in advance or arrears depending on the arrangement[52] - The carrying value of newbuildings financed by CCBFL increased to $101.1 million as of June 30, 2023, from $91.3 million as of December 31, 2022[49] - The carrying value of vessels and equipment financed by AVIC was $286.8 million as of June 30, 2023, with a balance under the facility of $250.8 million[131] - The first purchase option for vessels under sale leaseback agreements is set at $56.9 million in year 3, declining to $47.2 million after year 7[127] Corporate Governance and Agreements - The Corporate Support Agreement with Magni includes compensation of $2.7 million for services provided, fully paid following the delivery of the first four vessels in the six-month period ended June 30, 2023[153] - Affinity holds 10.3% of the Company's outstanding common shares and acts as a broker for the twelve newbuilding contracts without any consideration paid from the Company[154] - The authorized share capital of the Company is $140,010,000, represented by 140,010,000 authorized common shares[156] - The company has received assurance from the Bermuda Minister of Finance for tax exemption on income and capital gains until March 31, 2035, providing a favorable tax environment for operations[109]