BW Epic Kosan publishes inaugural Financial Results for Q1 2021

(Oslo / Singapore, 12 May 2021)

BW Epic Kosan Ltd. (ticker “BWEK“, “BW Epic Kosan“ or the “Company“) today announced its unaudited financial and operating results for the first quarter ended March 31, 2021.

Highlights for the Quarter

• Completed creation of BW Epic Kosan in March 2021 with combination of Lauritzen Kosan A/S (LK).
• Combination has economic effect from 1 January 2021, with LK profit/loss for Jan/Feb assumed by BW Epic Kosan and reflected in the purchase price allocation. Full consolidation effective 1st March 2021.
• Reported Net Profit of $7.0 million, excluding an LK net profit of $1.7 million for Jan/Feb that was not consolidated but is applied to the purchase price allocation. Underlying Net Profit of $8.7 million.
• EBITDA of $21.1 million.
• Cash of $60.3 million.
• Increase in Fleet on the water from 42 to 76 vessels.
• Annual dividend policy approved by Board of Directors.
• Re-domiciled from the British Virgin Islands to Singapore.

“The transaction to form BW Epic Kosan completed in March, increasing the Company’s fleet on the water to 76 vessels. The first quarter has been one of transition, with our results reflecting one month of combined consolidated operations. We achieved a positive start with a net profit for the first quarter of $7m, equivalent to an annualised ROE of over 7% excluding $1.7m of pre-completion unconsolidated profit.”

Charles Maltby, Chief Executive Officer of BW Epic Kosan

“Our expanding fleet mix, which now includes pressurised, semi-refrigerated and ethylene capable vessels, combined with a stable underlying market, saw our time charter earnings (TCE) per calendar day increase by 7% year on year to $10,912 per day, whilst our underlying OPEX costs remained stable at just over $4,400 per day. Our SG&A has increased due to costs incurred during our combination and can be expected to reduce as we work towards operational efficiency,” commented Charles Maltby, CEO of BW Epic Kosan.

“Covid-19 continues to impact our business, including increased overall operational expenses (OPEX) primarily related to crew change expenses and freight forwarding costs for spares, and increased offhire for our fleet as we position vessels to facilitate crew changes and meet quarantine requirements. We were greatly saddened post-quarter end by the loss of a crew member who had contracted Covid and are following up with responsive measures. We fully endorse the work of international organisations and industry bodies to facilitate safe crew transfers and vaccination.”

“We sold and delivered one smaller 3,500cbm vessel during the quarter, in line with our strategy to focus on the larger vessels in our fleet. Our strategy is focused on customer service and operational integration of our business to further our earnings potential, reduce our costs, increase our efficiency including through investment in digitalisation, and work towards the IMO emissions targets for 2030 through to 2050. We are working alongside industry partners not only to reduce emissions, but also including projects that support wider decarbonisation, such as shipping related to carbon capture and storage (CCS).

“We have completed re-domiciliation of the company to Singapore, and with completion of our transaction with Lauritzen Kosan in March, there are now a total of 152,510,755 shares in issue. The Board has confirmed a dividend policy, subject to annual approval, based on a pay-out ratio of 50% of annual net profits after tax, adjusted for extraordinary items. For the balance of 2021 we expect the challenges of 2020 to remain with us. However, there are strong pockets of residential LPG demand, and signs of increased activity in European refining and petrochemical plants, with LPG seaborne trade growth forecast to rebound to 3.3%, whilst smaller gas vessel fleet growth forecasts for the year are 1.4% before incremental scrapping.”

Conference Call and Slide Presentation
A live Zoom meeting to discuss these results is scheduled for 12 May 2021 at 08:00 AM (New York) / 01:00PM (London) / 08:00PM (Singapore).
A slide presentation will be shared during the Zoom meeting and will be accessible on the Investor Relation page of the Company’s website www.bwek.com.
Please register in advance for this webinar via the following link: https://zoom.us/webinar/register/WN_QjcL5kXLQAi1W_d2QlFICQ
After registering, you will receive a confirmation email containing information about joining the webinar.
A replay will be available shortly after the conclusion of the live event on the Investor Relations page of the Company’s website.

About BW Epic Kosan
BW Epic Kosan Ltd. owns and operates the world’s largest fleet of gas carriers providing seaborne services for the transportation of liquefied petroleum gas and petrochemicals. The Company controls a fleet of 76 vessels which serve the international supply chains of leading oil majors and commodity traders throughout Asia, Europe, Africa, and the Americas. The Company has significant commercial and technical capability across pressurised, semi-refrigerated, refrigerated gas and petrochemical transportation, and aims to deliver customers the best solution for their transportation needs, along with leading service and operational standards. The Company is headquartered in Singapore, with Copenhagen as a regional office alongside offices in London, Manila, and Tokyo. The Company’s shares are listed and tradable on Euronext Growth Oslo under the symbol “BWEK”.