Financial Data and Key Metrics Changes - The company reported a net profit of $98.1 million for Q3 2024, with an adjusted profit of approximately $37 million after capital gains [3][5] - Year-to-date profit reached $777.7 million, with trailing 12-month net income close to $1.2 billion [4][5] - EBITDA for the quarter was $116 million, and liquidity at the end of Q3 stood at $326 million [3][4] - The contract backlog remained stable at $2.06 billion, with outstanding CapEx at $2.5 billion [4][10] Business Line Data and Key Metrics Changes - The tanker division achieved a weighted average earnings of $40,000, with a breakeven of approximately $25,900 [8][20] - The dry bulk division reported rates around $31,000, with a breakeven of $22,000, indicating a positive outlook [27][28] - The chemical tanker market showed healthy operations with spot market rates above $25,000 [39] - The container market is facing caution due to a significant increase in fleet size, with expectations of downward pressure on rates [36][37] Market Data and Key Metrics Changes - Bearish signals from China include a population decline and reduced oil consumption due to the rise of LNG trucks and electric vehicles [13] - In the Middle East, geopolitical risks are impacting oil markets, with a notable increase in the gray fleet's share of oil exports to China [14][15] - Positive signals in iron ore and steel markets are anticipated, with expectations of policy support from China [15][16] - The tanker market is seeing a manageable order book, with VLCCs and Suezmaxes showing positive demand signals [19][20] Company Strategy and Development Direction - The company aims to maintain a diversified fleet and invest in future-proof newbuildings, focusing on decarbonization options [48] - The strategy includes increasing the contract backlog and engaging in long-term contracts, despite recent delays in project confirmations [53] - The company is cautious about the container market due to the anticipated increase in fleet size and potential downward pressure on rates [36][45] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the tanker and dry bulk markets, while remaining cautious about the container sector [45] - The company is closely monitoring geopolitical risks and their potential impact on oil demand and supply dynamics [17][24] - Management highlighted the importance of customer willingness to engage in dual fuel options as a key driver for business growth [59] Other Important Information - The company has undergone a name change from Euronav to CMB.TECH, with a new ticker symbol [6] - A mandatory tender offer is currently running, set to close on November 21 [47] - The company is committed to maintaining its listings on Euronext and NYSE [47] Q&A Session Summary Question: About the contract backlog and its flat evolution - Management confirmed that the flat backlog is due to delays in project confirmations and a relatively quiet market, but they remain confident in increasing the backlog soon [53] Question: On India's crude oil demand and the gray fleet - It is difficult to quantify the portion of oil demand in India fulfilled by the gray fleet, but it is clear that both India and China are significant users of such vessels [54] Question: Comments on the MEPC meeting and US elections impact - The MEPC meeting was viewed positively, with expectations for a carbon levy agreement in April next year, though the impact of US elections on decarbonization strategies remains uncertain [56][58] Question: On CII compliance and its effects - The global fleet's compliance is worsening, which could positively impact supply if ships need to take corrective measures [61][64] Question: On debt and floating interest rates - The majority of the company's interest-bearing debt is floating, and they aim to match hedging with long-term contracts [71] Question: On the CSOV market and breakeven levels - The breakeven for CSOVs is around $32,000 to $33,000, with current rates still above that level [81] Question: On fleet composition by 2027 - The ideal fleet composition by 2027 will focus on profitability and modern vessels, with an emphasis on dual fuel capability [82][83] Question: On CapEx commitments and secured financing - Current CapEx stands at $2.5 billion, with approximately $950 million of ships not yet secured in financing [94][95]
Euronav NV(CMBT) - 2024 Q3 - Earnings Call Transcript