Today we'll go through the presentation on the Investor website, where you can find this, and we'll take it in two parts. We'll discuss the numbers, of course, but also the industry review. You are more than welcome to take any question, put them in the chat, and I'll be the moderator. My name is True Östergård with HE Andersen Capital. Welcome, Michael. Nice to see you. Thank you very much. Let's go directly into it. It's the Q1 season, so please go ahead. Yeah, thank you so much. Yeah, thank you again for inviting us to give a quick overview and presentation of the first quarter for Hafnia. If you just quickly look at the numbers, which we just announced this morning, the first quarter was a net profit of SG 63.2 million, which is, when we look at the result for Q1, it's a marginally better result than we had in Q4. When we look at the earnings sign, it cleaned it off for one-offs, etc. As we're also saying in the release today, we're already seeing that Q2 is on track to become better than Q1. I think all in all, what we kind of take with us from Q1 is that last year's, if you like, sliding tendency in the second half of the year has been broken at least, so that we are now on a slow upward trajectory from what we saw in Q4. At least that's the positive part of it. Before we go into sort of the market thing, I think the other thing that I think is important to highlight is the fact that we are paying out 80% of the net profit in dividend, which is in accordance with our dividend policy. In comparison to Q4, we have not this time deducted the share buybacks that we have done in Q1. It is a full dividend payout. In addition, we bought back shares as well for Q1. If you like, we listened a little bit to the investor environment that did not like the fact that we were taking share buybacks and deducting them from our dividend payout policy. We are now back to having a stable dividend policy. Cool, Michael. This is actually a slide on that. When I flipped through it, it was just amazing to see you actually paying out more than you make, so to speak, on the bottom line this time. Perhaps you could just reflect a little bit about the investor feedback you had, because you have a lot of dividend investors, is my impression. Yeah, and I think as always, and I think I've mentioned this on this call as well previously, that every quarter we obviously debate with the board of directors, should we have some share buybacks, is it dividend? Obviously, you want to optimize and cater for as many investors as possible. I think we also have to realize that in a world that's already now dominated by a lot of uncertainty in geopolitical events that has a massive effect almost on a day-by-day basis, I think people are also looking for stability. I think it's not the time to be too erratic on how you do these things. I think it's better to be stable on the dividend policy. As we go forward, if we decide to buy back shares, then we will do it in addition to the dividend payout, so it does not become something that is being deducted, but something that will be an add-on if we should consider that going forward. Just for clarification, the day of dividend is going to be 23rd of May, is that correct? I think that's what I found is correct. Yeah. Yeah, cool. Mike, before we go into the industry review, you wrote in your sort of remarks that it's a complex world, and I appreciate that. It must be running this business. What we sort of discussed is to try and make it simple by flipping through a number of many charts you have, which can seem a little bit technical, but the intention is to get an understanding of what's driving the business into 2025. Please bear with us if it becomes a bit technical today, but we'll try and explain as good as we can, Michael. Let's start with this industry review and maybe describe a little bit about the recovery you have seen through Q1, please. Yeah, so I mean, the recovery that we have seen is, as I said, it was marginal towards Q4, but at least what it has shown is that we're back to slightly more stable levels, if you like, in terms of earnings and markets functioning a little bit better. If you look at these slides, I mean, I think the best way for us to explain where the markets are, say, today versus last year at the same time, the biggest difference is that the uncertainty in the world has actually meant that oil is traveling a bit shorter than what we saw a year ago, basically. That has to do a little bit with the fact that when oil prices are so volatile, and they are volatile not because of a supply-demand scenario, but more volatile because of news and geopolitical news overnight, there is a tendency among traders to minimize the risk of having oil traveling longer distances, because every day is a new risk for the pricing changes. We are seeing same volumes on board our vessels as we saw a year ago, so same activity in terms of volume, but we are just seeing ships sailing a bit shorter. In our view, as hopefully at some point the world normalizes and comes back to more stable conditions, you will see that volume start going longer haul again. That is kind of the thesis that we are looking at when we try to assess the market going forward. Let's just go through some of these slides, because yeah, let's take them one by one, actually, Michael. Please. This is the one that actually kind of pretty well highlights what I said, right, that we've basically seen, if you look at the left side, which is clean petroleum products and chemicals, that if you go back and look out through the years, you can see that we're actually here in 2025 having even higher cargo volumes on board the ship. In a normal circumstance world, that would mean that the market would be super, super active. As I said earlier, unfortunately, they're not going as long sailing distances as they did when the market was really peaking. If you are to choose between the two, you would always want the volume, because that's kind of what drives it. The ton mile, as long as you can explain why the distances are shorter. In this case, it's not because the trading pattern or the supply and demand fundamentals are changing anything. It is more about the uncertainty in the world that makes people minimize their risk by not having committed to sailing oil very long distances. That is what we can see here, right, on the left side as well, that the laden and ballast voyage length has gone down. Those are the two in combination, really, that indicate where we are. I would like to say, though, still, if you look at the timesheet results that we have today and the result that we came out with, from a historical perspective, these are still great numbers. They are still very much worthwhile to have a business that is making SG 23,000, SG 24,000, SG 25,000 per day with cash flow breakevens of around SG 14,000 on average for the year. I don't think we shouldn't be too negative. We came from a very high level, but I still think that from a dividend yield perspective as well, it's still a very attractive investment. Yeah. If you then take this, this is an ongoing discussion. We've had it for a long time with Russia and these sanctions. Let's dig into that a little bit, because there's many aspects of this. Maybe you can sort of take the high-level perspective on sanctions and how you see this, please. Yeah. As you say, we kind of have two areas of sanctions or dark fleet that we're operating with. One is vessels that are sanctioned by the U.S. and the EU, which is kind of the most important part of sanctions you can have. Then we have what we call the dark fleet, which is really a lot of vessels that are sailing with sanctioned oil, but also have unknown ownership. Basically, you do not know who owns the ships. They do not have insurance. They are very poor quality. They are basically a dark fleet that is living on breaking the law and ultimately is that potential risk of environmental disasters and others that most people would have read about in the papers. We are trying to identify these two groups here, which the OFAC list is the U.S. sanctioned vessels. What we're trying to illustrate here is a little bit, we just talked about the demand side, but if you look at the supply side, which is the amount of ships, it's fair to say that over the next four years, the product tanker order book is probably around 19%-20% of the current fleet. The reality is that a lot of the ships that are on that order book list will never be transporting clean petroleum products. By historical data, about 60% of half of those ships will be trading in the crude sector by definition. We think the net order book is about 14%, which means basically that it's about 3%-3.5% net inflow per year. If we do not have any scrapping before the ships come in, you could potentially see a market that will either stabilize or weaken a little bit over a period of one or two years. When you kind of look at these numbers here, it is pretty clear that the vessels that will have to disappear over the next three to four years by far exceeds the new buildings coming in. In other words, it is more of a timing issue. If the new ships come in before the old ships get scrapped, you could see a potential oversupply for a short period of time. If you look at the actual end of that period, the ships that will come in will be much, much less than the ships that will be going out due to scrapping and poor quality. This is, again, the illustration of that point, I guess, the limitations of the overall supply. Yeah. If you look at the bottom left, for instance, there you can see all the sanctioned vessels that are out there today that have not even reached the scrap age. These are ships that are being sanctioned because they've basically been transporting sanctioned oil. If the politicians decide that these ships are not going back into trade, just that category alone, you will remove a lot more ships than the entire new building order book coming in this year in 2025. That is the kind of dynamic that is very difficult to be precise on, because some can argue that, well, if we do not believe that politicians and regulators will punish people that have been breaking the law immediately, then you could argue that there will be more ships coming in and weakening the market before. If you believe that in any scenario of any form of ceasefire negotiations, that these ships will be pushed out, then you have a very bullish case. What is the timing on these decisions in your view, Michael? What are you looking for? How should we as investors look at this? Yeah, I think it's, I mean, I personally think it's very difficult, right? Again, I mean, we all read the same things. One day you think there is a solution on its way, the next day there is not. It doesn't look like it's just around the corner. I think the biggest thing to watch out for in all this is that we have seen this so-called dark fleet and the quality of the dark fleet upon close. There is no doubt that there is a very, very, very real risk of some kind of oil pollution happening with some of these ships. I mean, these are vessels that don't have any classification records. They don't have any insurance, as I said, and they don't have any clear ownership. They're hidden in complicated structures, which means that they can walk away from any problem there is, and they will. What can accelerate this is if we have, God forbid, any form of incident with some of these vessels, because at that point, politicians and regulators will most likely act pretty quickly. Yeah. Just a point of clarification, you distinguish between dark and gray fleet. Could you perhaps elaborate on the difference? Yeah, so the dark fleet are vessels that are trading with sanctioned oil and also have what we call suspicious ownership. In other words, you can see that the ownership structure is in such a way that you can't find the ultimate owner. That's a very important thing in shipping, because basically you always want to know who the ultimate owner is that you're dealing with, because you have to check insurance and you have to check that there are proper guarantees around the vessel that is sailing. The gray fleet, on the other hand, are actually owners that can be identified, but also owners that have been, if you like, transporting sanctioned oil, some maybe without breaking the law. Actually under these international regulations that under a certain price level, you are allowed to transport, for instance, Russian oil. It's a gray fleet of people that are close to those borderlines. Some would have crossed it, some would not, but you can identify the owners. That's kind of the difference. Cool. Yeah. Again, it's one of these where you're trying to sort of decompose the supply component into what's scrapping and so on. I don't know if you have elaboration on this one. I think on the left side, we can see where the order book is from 2025, 2026, 2027, 2028. That is what we know. On the right side, we are trying to illustrate for the entire tanker fleet, what does it look like in terms of scrapping for the next few years, what technically should be scrapped and move out. As I said earlier, scrapping age is the theoretical thing, because it is not like there is a law saying at this age you have to disappear from the market. We cannot say that everything will happen according to that. What you know is that when you hit these scrapping age of, say, 23, 24 years, it is suddenly extremely expensive to keep the ships going. You will be facing a lot of restrictions on the client base. For instance, the big oil companies will not accept ships over a certain age. What we are seeing as an alternative is even if a vessel, say, is 24 years old and has not yet been scrapped, what we are seeing is that they lose their employment status. If, for instance, a vessel has over a year, say, 360 days that it is sailing and making money for the company, then we are seeing that vessels, for instance, on the right side that have a scrap age suddenly only have maybe down to 30% or 40% of that sailing time. It is almost like an indirect scrapping for some of these ships. They are simply just not being utilized as much. Even though ships do not get scrapped and it is not in the statistics of being scrapped, we are seeing that they will virtually disappear from the market indirectly because they are not being used. Yeah. Michael, maybe this is a good opportunity to take. I read your statement on the front page, and you're saying that the higher rates, the global turmoil has sort of dampened the activity in terms of ordering. Could you perhaps comment on what you see of ordering activity in the market right now? Yeah, we haven't seen a lot for a long time. When we look at this order book here, that's obviously kind of what it looks like and more reflects what was being done last year. I think the uncertainty basically has kind of had its effect on ordering ships. We're not seeing a lot of ordering at all in the product tanker space or in the tanker space in general. Quite frankly, I think the people that really needed to order ships for replacement purposes already did it last year and the year before. Personally, I think you need to see lower prices from the shipyards, which is not in the cards at the moment, before you're going to kind of see people maybe going back to ordering again. Right now, it's a bit of a standstill between shipyards and ship owners in general. How has this impacted your appetite for ordering new vessels? Since end of 2021, early 2022, when we bought 44 ships, we haven't been buying anything. We've been selling over the last two years some of the older ships and ships that we didn't see as our core ships going forward. At these levels for us, we still think that it's too expensive to go in and buy new builds at the moment. We're not really tempted at that. That's why our dividend policy stands. Basically, we're just kind of continuing to harvest on the 125 to 130 ships that we financially control. Just quite happy really to return capital to shareholders. Just out of curiosity again, there's been a lot of stuff about China and India not accepting Russian ships or the dark fleet. Can you perhaps elaborate a little bit on the impact you have seen now? We've had that for, I don't know, a quarter. Yes. That is an impact that we are seeing increasing. I think that is also one of the impacts when I mentioned before that ships are being used less and less. The fact that China and India are now moving away from accepting vessels in the dark fleet will ultimately lead to these ships losing the percentage of utilization. That is actually part of it. It is obviously a very important thing because India and China were definitely those two countries that were taking most of the dark fleet into the area. It has been a big improvement. Certainly for us, it is something that ultimately will keep on reducing the utilization of these ships. Yeah. This is another big theme globally about this acceptance from the U.S. of Chinese ships. Maybe you can just briefly touch upon this. Yeah. It is true that the United States Trade Representative came with a proposal a while ago back in April where they basically wanted to punish people who had Chinese-built ships in their fleet and Chinese operators and owners in general. What happened is that when there was a hearing and they modified it, they checked around with a lot of different advisors. The proposal that is now on the table, which is a revised proposal, is actually more dealing with very, very big ships. There have been some kind of thresholds put in that basically means that for Hafnia, for instance, the vast majority, more than 90% of the vessels we have that are built in China will fall under the exemption rule that they have now introduced. Effectively, it's now the way it looks today, it's really a non-event for Hafnia. We have a couple of ships that may or may not be included because of finance solutions that we have on these ships. But that's something that we can change if it becomes realistic. For Hafnia now, that whole proposal has become a non-event and we will not have any impact on how we run ships and how the results will be. Okay, fair enough. Michael, if you should just reflecting on the fact that it's a complex world and we've been through a lot of big issues here, what is your sort of, if you have to summarize sort of your outlook, demand supply from now, what do you see? What I see is that on the short term, I think we probably have to just accept the fact that things will be volatile and news will come out overnight. Obviously, being in shipping and investing in ships, we can't really make investment decisions based on one year and two years. We make them on a longer-term basis. When we look kind of from one to three years out, it's clear there will be some new builds coming in, some older ships, and dark fleet will disappear. After that, after three or four years, I mean, technically half the fleet would have disappeared and only maybe 14% or 15% would have been coming back in. In the longer-term perspective, if one believes that all demand will just stay as it is today, even without an increase, we will once again be short of ships. It is the period in between that you can argue whether ships come in before ships go out. The good thing for us compared to others is that being in shipping and transporting refined oil products, gasoline, diesel oil, heating oil, et cetera, is that we're used to volatility, right? I think it's probably a lot worse for industries that are used to more stability that this is happening. Our life has always been like this because we're in the front end. Every time something happens, it has an immediate impact on how much gasoline, diesel, and gas oil people buy. I think the good news is we're used to handle a volatile world with a bit of uncertainty and navigating it as well. That's a skill coming in handy right now. Yeah. Just I don't want to go through the financial summaries, but I think there was one thing that maybe came as a surprise to many, and that's your docking right now. You sort of outlined here the need for some docking days over the coming period. It's quite high right now, actually. Is that a fair comment? No, it is quite high. It is because we have lots of vessels that were built in 2015, right? That is kind of they are hitting the dry dock schedule now. Yeah. This is a big dry dock year for us. There is no doubt, of course, as well that in Q1, if we did not have those off-hire days out, the result on absolute numbers would obviously have been larger. This is, again, it is a normal turnaround. I guess the issue is the more ships you have, kind of the more you run into these. It is true. That is why we make sure that people understand that the good news is on the back end of that, you have a number of years with ships that are totally up to speed. At the same time, hopefully we will be environmentally in a much better position. I use less oil for propulsion, right? Which is also part of the importance going into dry dock is to get the ships and the hulls and everything clean so that you are more efficient when you are sailing around the world. Cool. I always like this. I think it's actually an excellent outline of how expectations are in the market, which is very important to get. Do you have any comments to this? I think the coverage is more or less in line with what we've seen normally. Is that? The only comment I have is that it's the first time I've actually seen this slide where it seems like everyone kind of is close to agreement, right? I mean, normally the differences are a lot more. Actually this time around, it looks like that the analyst consensus versus our covered rates for our Q2, but also covered rates for the rest of the year are pretty much aligned. I don't know what to read into it, but at least we normally have a lot of Orions on it. This time it seems like people are much in agreement. That's nice to be in line for once. Could we take some questions, Michael? Sure. I think that there are some questions here, and I'll just take them and shoot if you don't mind. We see very low inventories of distillate going into the driving season. How would that influence you? I think it's a little bit from what I said earlier that the normal trading pattern also for middle distillates would actually be moving stuff from the Eastern and Western Hemisphere. We haven't seen a lot of that, right? I think there's no doubt that the shorter distances that vessels are trading have put a bit of a lid on the inventory situation as well. If anything, inventories being low in a volatile world always has the risk, which is positive for us, that in a sudden need of anything, you're going to have to transport what you need, right? Technically, low inventories always create an upside potential for transportation because if something happens and you need it, you're going to have to sail it to get to the destination. Yeah. Building on this Chinese, there's a question on what is the percentage of Chinese-built ships in your portfolio? It's about 30%, between 25% and 30%, which is relatively in line with China's market share in general. We don't have much more or more or less than what the average kind of ship owner will have that builds in China. It's just between 25% and 30%. Cool. And then back to this investor policy about the question goes with as price to NAV is below one, do you consider more share buybacks? As I mentioned, it's something that we will, I mean, we are discussing every single time. I think, I guess our view is that we do want to see what I would call a substantial discount to NAV before we would consider share buybacks. It's more of an ad hoc discussion, whereas the dividend policy is a permanent one in terms of that structure. As to scrapping, the rates are lower now. There's a question on do you expect the scrapping to accelerate through 2025 or perhaps change because of the lower rates? I mean, we do not see that we can avoid scrapping because basically there are so many older ships out there that it is got to be a matter of time before that happens. I also do recognize that if the freight market is high, it also reflects the fact that there is a demand for vessels. I do think there is a dynamic that if freight rates continue to rise and stay high, owners that are having older ships will try as much as they can until the last minute to try to get it going. I think scrapping will be driven more by regulators and by the inability to use older ships that have been sailing in the dark fleet rather than scrapping driven by very low freight rates that in a way makes it more attractive for a normal owner to scrap a ship that is otherwise trading in the normal markets. Perhaps a final question, Michael, on the Red Sea impact on the tanker and both actually your market and the crude tanker. Do you have any reflections on what's actually happening in the Red Sea as we speak and what will a sort of possible peace mean for you? Yeah. So right now, I mean, we're not seeing a massive amount of attacks or any other, let's say, violent maneuvers around shipping in general. It has been what I call, if I can use that term, a bit more calm in terms of hitting ships. Hafnia and any other of our competitors, everyone is still sailing around Cape of Good Hope. It's way too early for us to consider to go through. I don't see that as any at all immediate thing. That being said, and I think we had a slide on it the last time, and maybe we have one here as well. Basically what happened is when the Red Sea and the Suez Canal had all these issues and people started to sail around Cape of Good Hope, that was obviously initially great because vessels were sailing longer with the same volume of cargo. That's naturally good for the shipping market. What we have seen now, though, is that the volumes that we would normally have going to the Red Sea and the Suez Canal, it's not the same volumes going to Cape of Good Hope. We have lost volumes, and that's mainly because a lot of volumes from the Middle East going into Europe, for instance, it simply just doesn't make any sense to send it all the way around the Cape of Good Hope. That trade has been killed, if you like, which basically means that all the benefit we had from going to Cape of Good Hope, if we reverse all this and go through the Suez Canal, technically we would be getting that trading activity back that we lost via Cape of Good Hope. It would kind of even itself out. In our calculation, that actually would be neutral if we were to reverse the vessels to the Suez Canal and get those trading vessels back that we had originally before this happened. This concludes this presentation, Michael. I would like to thank you very much for joining, and thank you very much to all the audience. If you want to review this, this will be everywhere on all channels. If you have any questions, you can also refer to the Hafnia Investor Relations site. There are many, many things to dig into. Have a good day, Michael, and thank you very much. Thank you.