DHT Holdings, Inc. (DHT) Earnings

Management highlights

- Market Dynamics & Core Policy * Strong Q2 2026 results are driven by favorable supply/demand fundamentals, industry consolidation, and regional geopolitical disruptions, most notably the Iran conflict which expanded global ton-mile demand * DHT's top operational priority is crew, cargo, and vessel safety; the entire fleet did not trade in the high-risk Persian Gulf during Q2, and still delivered strong results without pursuing conflict-zone premium trades * Key structural factors supporting the tanker market include: constrained spot supply after major 2026 industry consolidation, strong institutional support for secondhand vessel asset values, and China's temporary destocking that is expected to reverse into a sharp import demand rebound - Operational Updates * During Q2, DHT secured two 1-year time charters for older vessels (DHT Sundarbans and DHT Amazon) at an average rate of $109,000 per day * Four planned 2026 newbuilds are fully delivered; the fourth and final newbuild, DHT Impala, was delivered from Hyundai in July 2026 with all required design upgrades completed * A new 2028-delivery newbuild, DHT Oryx, was contracted at Hanwha Ocean; it will be a sister ship to two earlier deliveries, with large carrying capacity and an exhaust gas cleaning system * 2026 dry dock program is progressing on schedule and on budget: 5 of 7 planned dry docks have been completed as of the call, with the remaining two scheduled for H2 2026; only 4 dry docks are planned for 2027 * Subsequent to Q2, DHT secured a 3-year time charter for DHT Jaguar at $75,000 per day (starting September 2026), finalized the sale of older vessel DHT Bahinia for $51 million in cash proceeds and a $34 million net capital gain, and secured an oversubscribed $250 million 7-year revolving credit facility with an uncommitted $250 million accordion feature - Capital Allocation Strategy * DHT maintains a policy of paying out 100% of ordinary net income as quarterly cash dividends; a $1.22 per share dividend was approved for Q2 2026, marking the 66th consecutive quarterly dividend * Core operational strategy prioritizes risk-adjusted shareholder value across market cycles: it combines locking in high-margin fixed revenue streams for cash flow visibility, maintaining balanced spot market exposure to capture rate spikes, and disciplined capital allocation that directly translates market tailwinds to shareholder returns via dividends

Guidance

- For H2 2026, DHT estimates a P&L breakeven of $29,700 per vessel per day and a cash breakeven of $22,600 per vessel per day, with a $7,100 per day difference between the two metrics representing discretionary cash flow retained for corporate purposes - For Q3 2026, DHT has already booked 1,020 time-charter days at an average rate of $75,900 per day, and 58% of planned spot days (596 of 1,029 total spot days) at an average rate of $152,700 per day - Q3 2026 spot P&L breakeven is expected to be less than zero, as forecasted time-charter earnings are projected to exceed total company costs for the quarter - As of the call, approximately 25% of the DHT fleet is covered by fixed time charters for 2027, and less than 20% of the fleet is covered for 2028; the company will take a patient approach to securing additional fixed charters as customer interest exists

Segment performance

DHT Holdings reports aggregate financial results for its single crude tanker fleet segment, with no separate product segment breakdowns provided. In Q2 2026, the company achieved TCE-based revenue of $255 million, adjusted EBITDA of $231 million, and net income of $198.3 million ($1.23 per diluted share, or $197 million / $1.22 per share adjusted for non-cash derivative fair value gains). Vessel operating expenses were $18.6 million, and G&A expenses were $5.6 million. For the first half of 2026, cumulative TCE revenue totaled $412.2 million, adjusted EBITDA reached $364.3 million, and net income hit $362.9 million, exceeding the company's previous full-year earnings record set in 2020. In Q2 2026, spot-trading vessels earned an average of $162,600 per day, time-chartered vessels earned $90,800 per day, for a combined average fleet TCE of $126,700 per day. For H1 2026, average daily earnings were $124,700 for spot vessels, $77,300 for time-chartered vessels, and $102,900 combined. At quarter-end, total liquidity stood at $569 million ($161.7 million in cash, $407.5 million available under revolving credit facilities), financial leverage was 14.1% based on market fleet value, and net debt was $11.9 million per vessel.

Risks & headwinds

- Geopolitical conflict in the Middle East (Persian Gulf and Red Sea regions) creates operational risk for vessels and crews, requiring DHT to avoid high-risk areas and implement costly re-routing that disrupts trade patterns - Forward-looking results are inherently uncertain, as actual performance may differ materially from current expectations due to unforeseen changes in geopolitical conditions, market dynamics, and industry fundamentals - High current secondhand vessel valuations make accretive, profitable expansion challenging for DHT - Newbuilding delivery from established, high-quality South Korean and Japanese shipyards is not available until 2030; earlier delivery options are only available from less experienced builders or the recently re-opened South Korean yard that has yet to demonstrate reliable performance to customers - All five of the one-year time charters for older vessels rolling off in early 2027 have no extension options, creating future revenue exposure to spot market fluctuations

Analyst Q&A

• Q: How has increased Red Sea conflict risk affected DHT's Yambu-to-Asia crude trading, and what is the new emerging trade pattern for these volumes? /

  A: DHT has stopped transiting the Bab el-Mandeb Strait due to Houthi threats, so all DHT vessels loading at Yambu now exit the Red Sea via the Suez Canal, which adds substantial transport distance. VLCCs must offload half their cargo to transit the canal, then reload on the Mediterranean side. Some vessels also shuttle between Yambu and Ain Sukhna, or load directly from Egyptian Mediterranean ports for delivery to Europe or Asia. All these changes reduce overall fleet efficiency and tighten global market conditions.

• Q: DHT has completed its 2026 newbuild program and has one 2028 newbuild contracted; does DHT still aim to expand its fleet beyond the 24 planned vessels, and would expansion be via secondhand purchases or newbuilds? /

  A: DHT still has a general ambition to grow the company, but current high secondhand vessel valuations make accretive investment challenging right now, so the company will remain patient. DHT will evaluate potential corporate consolidation opportunities, as it has completed strategic acquisitions in 2014 and 2017 historically. Any expansion will only be pursued at valuations and terms that deliver profitable growth, not growth for growth's sake.

• Q: If geopolitical tensions in the Red Sea de-escalate and international minesweepers secure the Strait of Bab el-Mandeb, how quickly could DHT return to normal transit operations? When would you expect normal operations to resume in a best-case scenario? /

  A: DHT cannot predict a timeline for a return to normal operations, as the security situation remains volatile and unpredictable with ongoing targeting of specific vessels, nationalities, and cargoes. DHT will not be a first mover to resume transits even after announced security measures, as crew safety remains the top priority, though the company strongly hopes for a return to normalcy relatively soon.

• Q: Five of DHT's oldest 15-year-old vessels are on 1-year charters expiring in early 2027; would DHT sell these older vessels at current high asset values even without a replacement lined up, to capture capital gains? /

  A: DHT aims to maintain total fleet earning capacity, and ideally would only sell these older vessels after securing a clear path to fleet renewal and net expansion. The five older vessels are in excellent condition and can continue operating profitably for 5-6 additional years or more if needed. There are no current divestment plans for these vessels, and any future decision will follow a clear replacement plan.