Welcome to today's Pacific Basin 2023 Annual Results Announcement Conference Call. I am pleased to present Chief Executive Officer Mr. Martin Fruergaard and Chief Financial Officer Mr. Michael Jørgensen. For the first part of this call, all participants will be in listen-only mode, and afterwards there will be a question-and-answer session. Mr. Fruergaard, please begin. Thank you very much. Welcome, ladies and gentlemen, and thank you for attending Pacific Basin's 2023 Annual Results Earnings Call. As said, my name is Martin Fruergaard, CEO of Pacific Basin, and I'm joined by our CFO, Michael Jørgensen. Assuming that you have already gone through the presentation, we will briefly highlight some of the key points discussed in it before we proceed with the Q&A session. Please turn to slide three. First of all, let me start by extending my appreciation to our dedicated seafarers and shore-based employees who have contributed to delivering a strong set of results in 2023. In 2023, we achieved a net profit of $109 million and an underlying profit of $119 million, with an EBITDA of $347 million. This resulted in a 6% return on equity and an earnings per share of 16.5 HK cents. Despite challenges such as slowing global growth, higher interest rates, and increased vessel supply, we delivered a solid result. Our result was largely due to the increased global demand for dry bulk, particularly from China post-COVID reopening. Our large core business generated $167 million before overheads despite the weaker freight market, while our operating activity, which includes vessels chartered in for less than 12 months, contributed $26 million, having generated a margin of $1,090 net per day over 23,480 operating days. Leveraging our high level of cash generation, we have reduced debt, expanded our own fleet's state-of-the-art carrying capacity, and maintained a robust financial position with $549 million in available committed liquidity. In view of our solid financial results, strong cash generation, and confidence in the long-term fundamentals of the dry bulk market, the board recommends a final basic dividend of 1.6 HK cents per share and an additional final special dividend of 4.1 HK cents per share, which, combined with the 6.5 HK cents per share interim dividend distributed in August 2023, amounts to $82 million representing 75% of our net profit for the full year. This will be the third consecutive year that the board has returned dividends above 50% of annual net profit, and we continue to be committed to distributing excess cash to shareholders through dividends. Please turn to slide four. Management aims to maintain a robust and flexible capital structure throughout the shipping cycle to meet our commitments, strategic objectives, and maximize shareholder returns. We aim to create shareholder value through optimizing our capital structure, investing in value-adding and countercyclical growth opportunities, and distributing funds to our shareholders. Over the last six years, we have generated profit of $1.55 billion and paid out excess of $1 billion in dividends to shareholders, representing 69% of our net profits, highlighting our ability to deliver attractive long-term returns over the shipping cycle. Our unwavering dedication is evident in our distribution policy, which commits us to paying out at least 50% of annual net profit, excluding vessel disposal gains. We continue to retain our general mandate for the buyback of shares of up to 10% of the share capital of the company, and we will continue to consider this as an additional way to return capital to shareholders. Please turn to slide five. In 2023, average market spot freight rates for the Baltic Exchange Handysize Index and the Baltic Exchange Supramax Index were $8,990 and $10,680 net per day, respectively. Despite increased dry bulk loadings overall in 2023, Handysize and Supramax market freight rates declined due to decelerating global economic growth, higher interest rate, and increased supply due to new building deliveries and limited congestion in China. In August 2023, freight rates experienced a significant seasonal increase due to various factors. These factors include increased seasonal demand, ongoing growth in tonne-mile demand resulting from the Russia-Ukraine conflict, restrictions on Panama Canal passage, and later on disruptions in Red Sea transit. These combined circumstances contributed to an improved supply and demand balance, which supported higher rates, particularly in the Atlantic Basin. Current forward freight agreements, commonly referred to as FFA for Q1 and Q2, are $11,730 and $13,930 per day, and $12,990 and $15,600 per day for Handysize and Supramax vessels, respectively, indicating an improving market going forward. In 2024, freight rates began higher than in 2023, and we started the year with good cover for the Q1. We recently observed an increase in seasonal dry bulk demand, a typical trend after the conclusion of the Lunar New Year festivities. Additionally, the limited transit of dry bulk vessels through the Suez Canal and Panama Canal continues to benefit supply, which should also support freight rates. Please turn to slide 6. Global dry bulk loading volumes grew approximately 2% year-on-year, supported by China's reopening. Minor bulk loading increased 1% in 2023 due to increased loading of bauxite, steel, and ores and concentrates. Bauxite continued to be the main driver of increased minor bulk loadings, primarily from Guinea, and which are mainly carried in Capesize and Panamax vessels. Grain loadings decreased by 1% year-over-year due to limited exports of grain from Argentina and the United States due to drought, while Ukraine's Black Sea exports remained affected due to the conflict. Brazil achieved record grain loadings in 2023, benefiting from favorable weather conditions, improved agricultural practices, and increased demand from China. On the other hand, coal loadings increased 4% year-over-year, largely because of record Chinese import despite record domestic coal production. India also imported record coal as favorable economic growth, though increased electricity demand. Iron ore loadings increased 4% year-over-year due to increased production from Australia and Brazil. Additionally, there was a significant rise in export from India, which is predominantly carried on Supramax vessels. Please turn to slide seven. Our core business generated average Handysize and Supramax daily TCE earnings of $12,250 and $13,830 net per day, respectively, in 2023, which is a decrease of 48% and 51% compared to, of course, the much stronger 2022. Our TCE earnings in the Q4 2023 for both our Handysize and Supramax vessels were positively impacted by prior periods' freight tax adjustments, which relate to freight earnings completed by our vessels in the past few years and are not changes in accounting treatments. For the Q1 2024, we have covered 100% of our committed vessel stays on both our Handysize and Supramax vessels at $11,170 and $13,480 net per day, respectively. For 2024, we have covered 54% and 71% of our core vessel stays for Handysize and Supramaxes at $10,160 and $12,610 net per day, respectively. Please note our Supramax forward cover estimates exclude the scrubber benefit, which is currently about 1,110 per day across our core Supramax fleet. We continue to be long vessels, and we believe we hold sufficient backhaul cover to optimize our voyages, such as by combining fronthaul and backhaul trades, and those enhance our vessel utilization and earnings. Our focus will be to maximize earnings with higher-paying fronthaul cargos. Please turn to slide eight. In 2023, our Handysize and our Supramax vessels outperformed the indices by 3,260 per day and 3,150 per day, respectively. Our large core fleet of Handysize and Supramax vessels contributed $97 million and $70 million, respectively. Our Handysize and Supramax vessels have now outperformed the index over the last nine and 10 quarters, respectively. Our Supramax vessels' outperformance has benefited from scrubber installation across our core fleet, with scrubber contributing $850 per day to our outperformance in 2023. Currently, our core vessels comprise 57 Supramaxes, of which 32 are fitted with scrubbers. Our operating activity generated a positive margin of $1,090 net per day over 23,480 operating days. Our operating days increased 18% as compared to the same period last year. We continue to target further growth in our operating business, which provides us with an ongoing opportunity to leverage our commercial and operational expertise, as well as our global proximity to our customers, to generate additional income for the business. Our operating activity margin was compressed in the Q4 of 2023 as a result of the need to cover cargo position in a fast-upward-moving freight market during the end of the period. Please turn to slide nine. Our Handysize owned vessels' costs have decreased, mainly due to lower crew repatriation costs as COVID-related controls have been relaxed. We continue to improve our cost competitiveness with our indicative owned fleet cash break-even level reducing to $4,930 net per day, which is a 13% reduction year-on-year Please turn to slide 10. Our Supramax and Handysize owned vessel depreciation costs increased mainly due to higher dry docking costs and investments in fuel efficiency technology, including silicone and antifouling paints. Our blended Supramax costs remain cost competitive, and we are scheduled to redeliver five higher-cost long-term chartered vessels during 2024. These vessels were chartered in during the higher-rate environment of 2022. Our indicative owned fleet cash break-even level reduced to $5,090 net per day, which is a 2% reduction year-on-year. Please turn to slide 11. During the period, we acquired 8 high-quality Japanese modern secondhand vessels. These included 6 Ultramax vessels and one Supramax vessel and one Handysize vessel. In 2023, we have sold 8 vessels consisting of 7 Handysize and one Supramax vessel with an average age of 20 years. Additionally, we sold one Handysize vessel in 2024, which we expect to deliver to the buyer by May 2024. Given increasingly strict existing and incoming decarbonization regulation, such older and less efficient vessels will become increasingly challenging to operate. We therefore consider it wise to gradually divest ourselves of our least efficient vessels. We remain committed to our long-term strategy to grow our owned fleet of Supramax vessels by acquiring high-quality modern secondhand vessels and to renew our Handysize fleet by replacing our older and less efficient Handysize vessels with younger and larger Handysize vessels. Our core fleet consists of 132 Handysize and Supramax vessels, including chartered vessels in our operating business. In our operating business, we have approximately 266 vessels under management overall. Please turn to slide 12. To support the future growth and renewal of our core fleet, we have signed agreements for the long-term inward charter of both Handysize and Ultramax vessels. During the period, we took delivery of 3 Japanese-built Handysize vessels on long-term time charter. These time charters all come with options to extend the charter agreement period at a fixed rate and/or purchase the vessels at a fixed price. Additionally, we have signed long-term charter agreements for 4 Japanese-built Handysize new buildings, all with scrubbers, as well as long-term time charters for 4 Ultramax new buildings. Each of these time charters also comes with an option to extend the charter agreement at a fixed rate as well as having the option to purchase the vessel at a fixed price, which further expands our optionality. It is important to note that these Handysize and Supramax vessels are newer, larger, and more efficient, with the ability to earn approximately 20% and 16% above the index, respectively. Our collaboration with NSY and Mitsui is progressing well in designing an efficient dual-fuel vessel capable of running on fuel oil or sustainable methanol. However, we remain cautious in our approach to invest in new buildings due to current historically high new building prices. We expect to be ready to build such a vessel with delivery well ahead of our regional 2030 target. However, we anticipate ordering activity within our sector for such dual-fuel midsize dry bulk low-emission vessels will be limited in 2024. I will now hand over to Michael, who will present the financials, and I will be back afterwards with Outlook and strategic summaries. Michael. Thank you very much, Martin. And good evening, ladies and gentlemen. Please turn to slide 14 for an overview of our P&L statement and financial performance. As you can see, given our lower daily TCE earnings, both our underlying profit and EBITDA were lower despite decreased owned vessel and chartered costs. Our G&A has decreased mainly due to lower discretionary remuneration provisions given the lower result for the period. We took a one-off non-cash impairment of $16 million relating to eight of our smaller older Handysize vessels. It's important to note that their carrying values represent only 4% of our owned fleet. These eight vessels are below 30,000 tonnes deadweight carrying capacity with an average age of 15 years, which have less earnings capacity compared to a main fleet of standard Handysize and Supramax vessels. Below underlying profit, our net profit was further improved by gains on vessel disposals. Please turn to slide 15. Our operating cash inflow for the period was $286 million, and that is inclusive of all long and short-term charter hire payments. This compares with $874 million in the full year 2022. We had $92 million in proceeds from the sale of eight smaller Handysize vessels, one Supramax vessel, and one Ultramax vessel, which we delivered in the period. In December 2023, we successfully concluded our first sustainability-linked unsecured revolving credit facility of $150 million. This facility will give us improved financial flexibility and aligns with our commitment to sustainability with interest margin adjustments tied to carbon intensity and crew safety performance, which we prioritize among our most important ESG issues. CapEx spending remains well controlled, and for 2023, total $252 million, of which we paid approximately $190 million for one secondhand Handysize vessel and eight secondhand Ultramax vessels, and around $62 million for dry dockings and investments in fuel efficiency technology, which Martin discussed earlier. We expect CapEx for 2024 to be approximately $65 million, predominantly relating to dry dockings and investments in fuel efficiency technology and excluding any vessel purchases. We have paid out $280 million in dividends, which relates to the 2022 final basic and special dividend of 26 HK cents per share, which we paid in May 2023, and the interim dividend of 6.5 HKD per share in August 2023. Our borrowings in the period decreased due to net repayments of $81 million following the normal amortization profile of our loans. Please turn to slide 16. Despite significant shareholder distribution, we continue to maintain a healthy financial position with $549 million of available committed liquidity, which includes $262 million of cash and deposits. This is why we reduced debt and expanded our deadweight carrying capacity by 4%. Our net borrowings are now just 2% of our owned vessels' net book value, and we currently have 62 unmortgaged vessels. Our goal going forward is to ensure that we maintain a robust, safe, and flexible capital structure. Our distribution policy is to pay out dividends of at least 50% of our annual net profit, excluding vessel disposal gains, and thereby any additional distributions can be in the form of either special dividends and/or share buybacks. I will now hand you over to Martin for his Outlook and strategy summary. Thank you, Michael. Please turn to slide 18. Minor Bulk seaborne demand is forecasted to increase 3% in 2024, which is supported by improved global macroeconomic conditions and increased demand from China. While iron ore and coal demand forecasts are down, we see further upside to estimates given positive Chinese government policy support to reinvigorate growth, particularly through investments in infrastructure. Limited transit through the Panama Canal is expected throughout the first half of 2024, while development in the Red Sea and the Gulf of Aden continues to remain complex. The combination has resulted in an increase in tonne-mile demand as vessels are being rerouted from these key transit routes, which we expect to continue to support tonne-mile demand. Please turn to slide 19. High newbuilding prices, uncertainty around emissions regulation, and a long delivery time of about 3 years have continued to discourage any significant new ship ordering over the period. 2023 Handysize and Supramax newbuilding ordering was down 22% compared to 2022, and the dry bulk order book is currently 8.5% of total fleet. World shipyard capacity remains limited and well below peak capacity of 10 years ago, with the majority of incremental new shipyard capacity concentrated on higher margin non-dry bulk vessels. Please turn to slide 22. Our focus is on the gradual decarbonization of our fleet. Regulation must lead, and IMO and EU rules have taken effect in 2023 and 2024 to start driving the transition. We continue to watch and prepare for further decarbonization regulations such as FuelEU Maritime, which is a directive to drive the gradual takeover of renewable and low-carbon fuels when trading into and from EU, which will be effective from 2025. We also note the proposal for a package of maritime fuel carbon intensity reduction rules known as the US Clean Shipping Act and International Marine Pollution Accountability Act. This proposal is to implement requirements for shore power and a greenhouse gas levy, which is applicable to voyages into and from the US with the aim of zero emission by already 2040. Please turn to slide 25. In the medium term, we believe dry bulk demand will be supported by substantial global infrastructure investment with a focus on emerging markets such as India and ASEAN countries, as well as concern over food and energy security worldwide. Our view is that environmental regulations, both existing and upcoming, will deter excessive new vessel orders, will force progressively slower vessel speed, and eventually also accelerate scrapping, supporting dry bulk rates. We have a positive outlook on the future of the dry bulk market and expect to generate more sustainable earnings in the long term due to underlying demand and supply fundamentals. Our business has a promising future, and I eagerly anticipate the growth and progress of our company and industry. As we embark on a journey to tackle various opportunities and challenges, we have the chance to distinguish ourselves in the transition of dry bulk shipping to a low-carbon economy and continue to be leading the way in dry bulk shipping. We are enthusiastic about the long-term potential of dry bulk shipping. We believe that the robust demand for dry bulk shipping will continue, and we look forward to playing our part in the growth of the industry. Ladies and gentlemen, that concludes our 2023 annual results presentation. I will now hand over to the operator for Q&A. Thank you. We will now begin our question and answer session. If you have a question for today's speaker, please join the Zoom link via the blue Ask a Question button. Press the Raise Hand button, and you will enter a queue. After you are announced, please unmute yourself, state your name and company, and ask your question. If you find that your question has been answered before it is your turn to speak, please press the Lower Hand button to leave the queue. We currently have one question from Andrew Lee. Please go ahead and unmute yourself. Hello. Hi. Can you hear me? We can hear you, Andrew. Hey. Hi. Hi, everyone. Hey. Thanks very much for the call. It's very useful. I have a few questions. My first question is that in your previous results sorry, your previous calls, whether it's a quarterly or full year or interims, you always mentioned the word medium term on the overall outlook. Since this is not mentioned this time, would you say that you're more optimistic now on the near-term rebound rather than the so-called, say, medium term, which I think you mentioned before was on six months out? So based on what I'm saying, are you expecting the recovery to be happening from today? Second question is on shareholders' returns. I think in the presentation, in the results, you mentioned the word share buyback quite a few times. Does that mean that that's going to be the target going forward rather than the special dividend? Because I think this was mentioned this time, not compared to previous. Third question I have is on the operating activities. In the Q4 itself, it was only a $110 million margin. If I look at your Q3 2022, it was also lower as well, if you look at it on slide 8. Is this a seasonality? Is this the trend? Can you give us a little guidance in terms of how we should be looking at that going forward? Because $110 million is actually quite small in terms of the margin. Fourth question I have is, could you give us a little bit of guidance on your total core operating days for both the Supramax and the Handysize? The reason I say that is because we know how much long-term chartered days you have. But during the year last year, you had some changes in your owned fleet where you sold some, and then you also had some new, well, secondhand ships being delivered. So I just want to get a sense of what's the total number of the operating days. And that's it for now. Yeah. And the last question, Andrew, is you're talking about the core fleet or the operating fleet? The operating, the core fleet. So how many days are you going to have this year for the Supramax and the Handysize? Yeah. Okay. But maybe I could take the first about how optimistic we are, and then Michael can talk maybe about the share buybacks. Then I can talk about the operating part, and then we can maybe figure out the days in the meantime. But if I start with: are we more optimistic? Yes. I think we are more optimistic than when we met last time. And you can just look at the rate levels that we have now. Actually, if you forget 2021 and 2022, the rate level in the market today, that's the best we have seen for since, I think, 2014 or 2015 in it. So it's a start to the year. The market is really strong. Of course, it had the seasonalities that the market did come down. It did come up quite a bit at the end of the year. I think that's important when we talk about the operating profit. At the end of last year, the market actually came up very high. It did come down early this year as it normally does, but it has actually recovered very well after Chinese New Year. And then when you look at the FFA, which indicates the direction of the market, it looks very, very positive, actually, at the moment. Of course, I think, as always, a little bit back to normal. So I'm sure we'll have some seasonality during the year, but we have a very good start to the year at a high level. So I think that's very positive. You want to take the share buyback? Yeah. Then there was a question about share buyback, and it's correct. We are mentioning in our presentation here that our policy is to pay out a minimum 50% of dividends, and any additional payment can be in the form of dividends and share buyback. There's no decision at the moment. Of course, it's something that we're looking at. And I think it's fair to say that since the share price has stabilized, maybe reduced a little bit, and since asset prices have come up, there is a discount right now in the market if you compare our share price with the underlying net asset value of the company. So it is definitely something that we'll look at and study more carefully during 2024. But of course, this is a discussion and a decision to be made by the board, and it's something that we will monitor on a concurrent basis. Yes. And about the operating, well spotted, Andrew, yes, it's clear that when you see fluctuations, quite heavy fluctuations in the market, it does actually sort of hit a little bit on the operating market. What we saw end of last year was a fairly big increase in the rate levels. On top of that, we saw actually the market in the Atlantic, the spread between the Pacific and Atlantic last year and earlier this year is the highest we've seen for 12 years. Actually, the market reacted a little bit unusual. Of course, that makes the operating part when you see these increases, make the operating part a little bit tough in the short term. You have to sort of transition into a different market. You could say the fluctuation end of last year and early this year, of course, hits a little bit on the margin of the operating business in it. But I think we have that turned around now and moving forward as normal. So every time you have these big fluctuations in the market, it will sort of have an impact on both our outperformance of the index on the core fleet, but really also on our operating business. But all in all, it's good for us when the market goes up. All in all, we are fundamentally long on ships. Even though, of course, we have some short-term cover, that's quite normal. We have fixed the ships a month or two ahead of it. I hope that answered that question. In respect to the operating core business days, does it say there? The activity level. Yeah. So the activity level, you can say, yes, we are sailing out. You can say when you look at our deadweight capacity on the core fleet or the owned fleet, it's going up. You can say the earning capacity of the fleet is now higher than it was last year. Even though we sold ships, we have replaced them with bigger and newer ships. I think one of the things that we like to look at when you look at Pacific Basin, you can say coming into 2021, where we had a very good market in 2021 and 2022, I think we outperformed many of our peers in that market. But on top of that, we actually have more earning capacity on the fleet today than we had before we entered 2021. So we haven't sold out. The earning capacity of the fleet is there. So if we continue to see improving markets, we have the earning capacity retained in the business for sure. And on top of that, we have taken these long-term time-chartered deals partly as a replacement for the smaller and older Handysize we sold. We have taken, I think it's about 11 newbuildings being delivered from Japan on 3- to 5-year time-charters with purchase options and options for extended periods in it. So that's where we are at the moment. I hope that answered it, Andrew. Yep. That's good. Okay. I'll get back into the queue. I have a few more questions, but I'll let other people ask first. Thank you. We have a question from Parash Jain. Please go ahead and unmute yourself. Yeah. Hi. Thanks, Michael and Martin. And congratulations on a good set of results. And especially, thank you, Michael, for running a pretty prudent capital structure, probably something that your peers on the container shipping segment can learn. But my question is more with respect to the industry because of the Red Sea, lower Panama Canal water level, how do the vessels spend their time in between Atlantic and Pacific? Has it structurally changed therefore? And if that's the case, how shall we see and understand the volatility or rather the divergence in freight rate throughout the year? And secondly, 2023 is pretty much China growing like no tomorrow in terms of the import of dry bulk volume while the rest of the world was sluggish. Do you see a sort of China flattening out while the rest of the world starts to grow as your base assumptions when you talk about the growth number? Maybe if you can handle these two first. Yeah. Yeah. We'll try and thank you for the questions, Parash. First of all, the Atlantic Basin in respect to the Panama Canal and the Gulf of Aden, the Red Sea, of course, it has an impact on our business. I think it's important to say that no way as much as it has on the container business in it. Of course, there's less of our ships transiting the Panama Canal, but in the bigger picture, it's not a huge amount of ships we are talking about. But of course, all these things add up to, of course, an improvement in the market. And I think this big difference you saw between the Atlantic Basin and Pacific Basin that we had end of last year and early this year, which is historically it's 12 years ago, we had such a spread. I think that is partly due to those things as well. The improvements you see in the market now is actually driven by the Pacific Basin. So that's actually where we see the activity level, whereas the Atlantic Basin is settling down a little bit from very high level but coming down. And I think the Atlantic Basin is probably waiting a little bit for the harvest out of South America coming in in April. The thing is, of course, when you position the ships, I think about 45% of the Handysize fleet is normally at the moment in the Atlantic Basin, and I think a little bit less of the Supramax ships are in the Atlantic Basin. So it becomes very much how do you position the ships in the different areas? And I think when we have these issues with the canals and the transit, maybe there was less ships being positioned back into the Atlantic Basin. So of course, that drives the market up further. But actually, end of last year, early this year, the Pacific market was not very good, actually. But that has, of course, rebounded quite a lot at the moment. I think it's a good question as well on China and the world economy. I think, first of all, I think as I said, IMF has actually raised the growth expectation for the U.S. quite a bit, actually, and actually also for China. These two economies, of course, are super important for our market. I think Europe is, unfortunately, a little bit down, but probably as expected. I think the interest rates will probably not come down as quick as we had hoped for and believed. It might be a little bit later. But I would also say, in general, when you look at China, it's probably likely that the coal, I don't know if it's going to grow. I think there has been a little bit more rain that has helped the southeastern parts of the hydroenergy at the moment. But there's still a lack of rain on that part. So I think there's many fundamentals that when we look at China, it actually looks very busy. And when I talk to the chartering team, they say China is very, very active in steel and also now in forest products that they started importing again. So very mixed signal for China and so on. But when we look at the volumes going in and out, it's a little bit hard for us to be very negative about it. I think, in general, we see we don't think the world is out of the issues and problems, but it has been ongoing for a while, and maybe we are well through it. And therefore, we are maybe a little bit more optimistic about the future, which I also think IMF actually is as well as they increase the levels. Yes. Yes. Thank you, Parash. We have another question from Nathan Gee. Please go ahead and unmute yourself. Hi, Martin. Hi, Michael. Thanks for the call. Just a question on impairments. So look, this is the second impairment you've taken around the small Handysize ships. You took something a lot larger in 2020. Just help us understand this given the optimistic market outlook and how it jibes with the impairment. And also, is there any further risk of impairments ahead, particularly with the small Handysize? Okay. I can start with this question, and I think it's a very good question you're raising here. I think there's a little bit of history to it because some years back, we took an impairment on these small Handysize. And then the year after, it was reversed because there was a big uptick in the market. And now we're sitting two years later, and we can see that especially the smaller Handysize, the older Handysize have a little bit challenging in catching up with the bigger ships. So what we're talking about here is a cash-generating unit. That's what we call it, consisting now of 8 ships. Initially, it was 20 ships. So we have sold out. We have 8 ships left. The amount that we talk about, $16 million, it looks as a big amount, but it should be seen in comparison to a fleet value of more than $1.8 billion. So it's not a big thing. And when we look at our main fleet, the standard Supramaxes, the standard Handysizes, there's good value in them still. And at the current asset market values, we see no risk of further impairments at the moment in it. It's a little bit of a technicality why we have taken it. Clear. Thank you. Thank you. We have another question from Parash Jain. Please go ahead and unmute yourself, Parash. Yeah. Hi, Michael. This one is more on the supply side. So we have been into the world of EEXI and CII and now perhaps EU ETS. Have you seen a material impact in terms of reduction of effective supply thus far? And if not, do you expect this to materialize in 2025, if not in 2024? And secondly, given relatively profitable last few years and how fragmented the dry bulk ownership market is, do you see any reason why even a 15-year or 18-year-old ship owner who would have paid off all its debt and can't care less about depreciation to scrapyard, even if Handysize is generating anything above cash operating costs? Thank you. Yeah. So first of all, first question about the environmental regulation, IMO and EU and so on. We probably haven't really seen it because reality is the fleet is still doing economic speed. So even though the rates market looks very good, we're still the average speed of the fleet is still below 11 knots. So you don't really see it. Then, of course, we have had some discussions. "Why is that?" But reality, it's probably because the calculation on speed consumption versus the value of it still justifies that the fleet is at reduced speed. That might change now as the market goes up. So I think the rules are so that there will be more requirements year on year on year. So basically, what it does is that it will be hard at a certain time to keep raising the speed if you go slower. So there will be a ceiling on the speed. And then over time, you will see less and less speed, and therefore, there will take supply out of the market. But I don't think at the moment, we really have seen the impact of it. I would imagine you probably have seen a little bit of a little bit of specially more fuel-efficient ships calling Europe because at the moment, you have EU ETS, so you have to pay a fine on the CO2. So there's probably a different way of operating and utilizing the ships. And I think more modern and more fuel-efficient ships are probably calling Europe at the moment. So I think those rules, they will have an impact, but we haven't really seen it yet in it. And then to talk about sorry? Sorry, Parash? Yeah. No. That's fine. Yeah. And the second part in terms of what would drive smaller Handysize owners to hit the scrapyard at these levels? Yeah. You talk about scrapping. And you're absolutely right. Clearly, if the market continues to go up, everybody who has an old ship will, of course, do the calculation and will try to trade it as long as it's a positive cash flow contributor to the business. And that's also why we have seen every year, we talk about the scrapping, and every year, we don't really see the scrapping accelerating. And that's, of course, because the market is actually not so bad. So it still makes sense maybe to take it through a dry dock to try an additional period of time. And with the market outlook at the moment, I'm sure everybody will try to keep them trading as long as possible. But what it actually does, Parash, is, of course, that what we are building up at the moment is a scrapping pool because, of course, the ship will get older and not disappear. So I think fundamentally, even though when you look at the order book, which is around 9%, I think it is, the scrapping pool is also increasing quite a bit. And also, if you go in and look at the fleet profile of Handysize and Supramaxes, then please notice that the fleet that was built at the last upturn, 2009 to 2013, that is actually one-third of the fleet. So the pool of scrapping candidate, older ships in the smaller sizes, is actually increasing quite a bit over the next five, six, seven years, which I think is you have to look at that when you look at the overall supply situation for the fleet. Yeah. No. That's absolutely clear. It's just that in the near term, probably that lowers the risk of scrapping, right? It definitely will. So as a positive market, it will mean that people will try to keep the ships trading as long as possible, as long as you get a positive cash flow on the water. And as soon as you see a change in the market, they will probably send them for scrap. That is true. No. It's very, very clear. Thank you so much, and have a lovely day. Thank you. I'll take a few questions from online. The first question being, you have been active in buying secondhand vessels for the past few years. How is the market currently developing, and do you have a target number of vessels for 2024? Yeah. So we still had the same strategy. So our strategy would still be to buy secondhand ships. But of course, in our business, it's all about being disciplined and about being countercyclical in your decisions on it. And we have to say that the secondhand prices have actually gone up quite a bit, actually. So at the moment, actually, the availability of Japanese modern secondhand ships is very limited, and the prices are very high. We did buy one ship three months ago that we just got delivered. And we, of course, look at all opportunities that we see in the market. But we are probably a little bit more, should I say, disciplined at the moment due to the rapidly increasing asset prices we see at the moment, which is good for us all in all. But of course, it makes us maybe a little bit more worried about being too aggressive in the secondhand market. Follow-up question. In terms of your Handysize vessels and in particular, the smaller Handysize vessels, how many of these are on your list to sell going forward, and how are you approaching investment in the low-emissions vessels? Yeah. So the strategy is still unchanged, that we want to renew our Handysize fleet. And of course, the age profile of the ships is still that when they become around 20, we do the evaluation, as the discussion was before with Parash as well, about of course, we look at the cash flow opportunities of the ships compared to what sales price we can get for the ships and do that calculation. So we do that evaluation all the time. But historically, we have been selling the ships when they become around 20 years old. Of course, if the market continues to go up, it might actually be worth to keep trading them. Then you can trade them for maybe an additional 2-2.5 years. But then I think we will get to a point where we probably will sell them. The second part of the question, Peter, was? And then your approach in terms of investing in low-emissions vessels. Yeah. So we have had the project ongoing for, yeah, nearly 2 years with our Japanese partners in respect to a low-emission vessel. And you all know we sort of decided to go for the methanol part of it. We're still in the design phase in it. I think we said all along that the project was so that we were ready to order when we thought the timing was right. I think we learned a lot the last 2 years. Still a lot of uncertainties in the world in respect to the future of decarbonization and availability of fuels and these things. But we know we have to decarbonize. So for us, it's a question about the timing and, of course, also the price and the terms of doing that. But we are progressing with that project together with our partners. So let's see. Given your confidence in the outlook for 2024, how will you expect to grow your operating business throughout the year? But irrespective of what the market is, our operating business is, of course, where we leverage the overall relationship we have with our customers around the world and we have the local offices around the world. So I don't think our operating business actually has anything to do with high or low markets. It's all about getting access to the cargo and combining ourselves out of it in it. I think we've shown that we are good at that part. We have opened up an office in Dubai about a year ago, who's been very active also because it's a growth area for us. We just opened up an office in Singapore. I think that's also the investment we do. Besides, of course, investing in ships, we invest in the offices around the world because that actually generates the activity both in our core fleet but definitely also in our operating part. Our ambition is to grow that part of our business as well because it's just linked to the business we do anyway. The last question. How should we expect vessel costs going forward, and is there room to reduce costs further? Of the? Of Handysize and Supramax vessel costs? The operating costs. Operating costs. Well, I would say that our cash break even is about $5,500. It's the OPEX. I think we run our ships for we own ships for life. That's why we have ships that's turning 20. I think we are quite competitive in our cost picture. But we do also invest in our ships because that's how you run a safe and efficient operation in it. I don't think there's a big room in respect to the cost to do it. I think there is room for us to improve our efficiency and the optimization of our fleet. And that has probably more to do with bunkers, fuel costs, fuel consumption. That's why we put silicone paint on the ships. We use data to try to figure out how to position the ship, how fast to go, and so on. That's where the money is. And remember, the cost of fuel is just so much more than the OPEX in it. So for us, of course, the focus is on that part because we think there's actually room to improve further in it. That doesn't mean that on OPEX, we won't constantly look at how to do things better. But I think the room for real improvements on that part of it, I think that's more limited, actually. I think we have to look at how do we run the ships and how we get a better speed consumption on the ships and other things in that respect and utilize. We have 90% utilization of the ships. So 90% of the time, we have cargo on board. It's all about the backhaul, the fronthaul, the combination of the ships. That's where the value is. And I think that's actually what we are really good at. But of course, that's something we need to strengthen all the time. And that's why we focus on digitization as well because we think through that, we can use that data to do it better. We have another question from Parash Jain. Please go ahead and unmute yourself. Yeah. Hi, Martin. This will be my last question. Can you remind us the CapEx guidance for 2024 and 2025, both with respect to maintenance CapEx? Are there more scrubber fitting needs to be done of the pending purchases? Of the purchases that you have already made, how much need to be paid? And one final question. When we think about your capital return, is it fair to say that you are comfortable with your balance sheet as at the end of 2023? So whatever free cash flow that you're likely to generate minus CapEx minus 50% of payout would be something that will be available for a special dividend or share buyback? Thank you. Our CapEx for next year is $65 million. And I think it's in line with what we had in 2023. Now for this year, it's $65 million. And it's in line with what we had last year. We are spending a little bit more money in the dry docks because we now put silicone paint on because that gives us up to 8% saving on the performance of the ships when they sail afterwards. Again, that's back to this. Invest in something that actually gives you some operational saving afterwards in it. I think that's actually the CapEx we have committed to. And then as always, also like last year, last year, we spent $190 million on secondhand ships. We sold for $100 million in it. And of course, we hope also this year to spend some money on that part of it. And as to our balance sheet, I think Michael and I, we're sort of very happy with where we are. We're very happy with our liquidity. We're very happy with the operational cash flow we have at the moment. And of course, it gives us a lot of strength in the market to do different things in it. And of course, it gives us a lot of, yeah, opportunities going forward. And of course, it also, if these opportunities we can't find enough opportunities and we keep generating a lot of cash, yeah, then it's going to be hard not to return some of it to the shareholders, which I think we actually have shown that we have done with actually $1 billion in dividend the last three, four years. So yeah, we know the pressure you will put on us, Parash, on that part. I think it makes perfect sense. Thank you so much. Thank you very much. Thank you. At this point, I would like to remind the attendees, if you have a question for today's speakers, please join the Zoom link via the blue Ask a Question button, press the Raise Hand button, and you will enter a queue. After you are announced, please unmute yourself, state your name and company, and ask your question. We'll just take a moment to pause to see if there are any more questions. As there are no further questions, we'll now begin the closing remarks. Please go ahead, Mr. Martin Fruergaard. Yeah. I'd like to thank you again for joining us today and for your continued support of Pacific Basin. If you have any further questions, please contact Peter Budd from our Investor Relations Department. Thank you very much, and good evening. This concludes our conference call. Thank you all for attending.