First Ship Lease Trust (D8DU) H2 2023 earnings summary

Executive summary

• H2 2023 net profit was US$1.85m and FY net profit was US$3.67m, versus US$11.0m and US$13.3m in 2022; 2022 included a US$9.2m vessel-sale gain.

• All eight vessels were employed on fixed-rate period charters at 31 Dec 2023; contracted future revenue was US$18.8m firm plus US$5.8m optional.

• H1 2024 net profit was US$1.4m and adjusted EBITDA was US$3.1m; fleet utilization was 100%.

Financial highlights

• H2 revenue was US$4.41m, down 59.2% YoY; FY revenue was US$8.51m, down 64.9%.

• Adjusted EBITDA, excluding vessel disposal gains or losses and impairments, was US$3.32m in H2 and US$6.37m for FY 2023.

• H2 EBIT was US$1.91m, down 83.5% YoY; FY EBIT was US$3.92m, down 72.5%.

• The smaller fleet affected H1 2024 revenue and adjusted EBITDA compared with H1 2023; specialized tankers generated US$3.3m in adjusted EBITDA.

Outlook and guidance

• As at 31 Dec 2023, contracted future revenue was US$18.8m firm and US$5.8m optional, for potential total revenue of US$24.6m; optional revenue depended on charter extensions.

• As at 30 Jun 2024, contracted future revenue was US$20.5m, comprising US$14.7m firm and up to US$5.8m optional.

• Low fleet growth supported expectations for tanker markets over the next two years, while newbuilding deliveries from 2026 could weigh on conditions.