CBL International Limited Q2 FY2025 earnings call

Key managerial messages and operational highlights: - Global ports network: Operate in over 65 ports across Asia Pacific, Europe, Africa and Central America. - Strategic partnerships: Maintained long-term strategic partnerships with global industry leaders. - Financial highlights: Revenue decreased by 4.4% to USD 265 million; gross profit remained similar with slightly improved margin; operating expenses decreased to 17% from USD 4.12 million to USD 3.42 million; net loss narrowed from USD 1.62 million to USD 0.99 million. - Operational review: Service network expanded to 65 ports from 36 at IPO in 2023; Asia Pacific as primary revenue driver; biofuel sales grew significantly; participated in investor events and conferences; initiated ESG initiatives including materiality analysis and maritime volunteering programs.

CBL International Limited's segment performance for the period ended June 30, 2025: Total sales volume grew by 9.8% while revenue decreased by 4.4% to USD 255.2 million. Revenue distribution by geographic location: China accounted for 67.5% of total revenue, followed by Hong Kong at 27.8% and Malaysia at 2.1% with smaller contributions from other regions. Gross profit margin increased by 4 basis points to 1.02%. Net loss narrowed by 38.8%. Biofuel sales saw an impressive increase of 154.7% year-on-year in the first half of 2025, with volume growth reaching 189.5%.

Management's forward-looking guidance: Focus on strengthening service network, growing sales volume, integrating sustainable fuel solutions. Continue to expand service network, target new customers and segments, ensure compliance with carbon emissions regulations, and explore greenfield options like LNG and methanol. The company also plans to utilize office automation and IT systems to enhance operational efficiency.

Risks discussed: Geopolitical tensions such as Red Sea crisis and U.S. tariffs impacting shipping routes and trade flows; oil price fluctuations affecting fuel pricing and demand; intensified competition in key markets; regulatory changes related to sustainability and emissions that may impact biofuel adoption.

Q: Among growth areas, what was the most significant achievement achieved by CBL? How did the company produce results in this area? And what were the challenges? And how does CBL overcome them.

A: Teck Chia responded that CBL made rapid and strategic expansions on its global service network, growing from 36 ports at IPO in 2023 to 65 ports by June 2025. Growth was driven by targeting high-demand ports, strengthening partnerships, and diversifying into non-container liner segments. Challenges included geopolitical disruptions, oil price fluctuations, and competition. Overcome by leveraging agile and capital-light structure, securing scalable supply partnerships, and early investment in biofuel capabilities.

Q: CBL reduced its net loss by 38.8% year-on-year in the first half of 2025 despite challenges in the macroeconomic environment and oil price volatility. What were the key drivers behind this improvement? And how sustainable are the measures for the second half of the year?

A: Nick Fung responded that improvement was due to investment in port network expansion, customer base expansion, and biofuel operations, leading to double-digit sales volume growth, new customers, reduced reliance on top 5 customers, and operational efficiency improvements. Measures are sustainable as the company continues to look for investment windows to expand network and focus on sustainable fuel segments.

Q: Given the ongoing geopolitical tensions and disruptions in shipping routes, how is CBL positioned to capture demand from rerouted trade flows especially in the Euro-Asia and intra Asia corridors?

A: Teck Chia responded that CBL's extensive supply network in these regions allows it to target and meet demand from rerouted trade flows. The company has responded effectively, resulting in increased sales volumes in Asia Pacific and other emerging markets by leveraging its network to adapt to changing trade flows.