Navigator Holdings Ltd. Q3 FY2025 earnings call

• Q3 revenues were $153 million, up 18% QoQ and 8% YoY, with main drivers being higher time charter equivalent rates and robust utilization.
• Achieved highest EBITDA on record at $86 million and adjusted EBITDA of $77 million.
• Balance sheet is strong with $216 million cash at quarter end and $308 million liquidity.
• Increased capital return to 30% of net income from 25% and fixed dividend to $0.07 per share from $0.05.
• Sold Navigator Gemini for net proceeds of $30.4 million with a book gain of $12.6 million.
• Ethylene terminal throughput was 271,000 tons for the quarter.
• Financed newbuilds at attractive margins and loan to value, with newbuilds expected to be earnings accretive from delivery in 2027 and 2028.

In Q3 2025, Navigator Holdings generated revenues of $153 million, up 18% compared to the previous quarter and 8% compared to the same period last year. EBITDA was $86 million, and adjusted EBITDA was $77 million. LPG accounted for 42% of demand during the quarter, the highest share since the first quarter of 2023, while petrochemicals remained the largest segment at 44%. Utilization for semi-refrigerated vessels climbed to 98%, fully refrigerated fleet saw incremental demand, and ethylene-capable vessels had a utilization of around 85%.

• Expect utilization and average TCE rates to remain near Q3 '25 levels.
• Q4 started robust, with normalization expected if no further geopolitical surprises.
• Return of capital is a key priority, with increased earnings payout and fixed dividend.
• Target to complete financing for 6 newbuild vessels in early 2026.

• Geopolitical tensions and trade uncertainties, particularly impact on ethylene exports from the U.S. to China.
• Tariff changes and trade turmoil continuing to affect trading activities.

Q: In the dry bulk and tanker space, how do you think about net debt position over time?

A: Mads Zacho stated they have a comfortable balance sheet, see financing markets as competitive, and believe some debt on the balance sheet benefits shareholders. Current net debt to EBITDA is 2.6x.

Q: What drove the increase in capital allocation from 25% to 30% payout and $0.05 to $0.07 dividend?

A: Mads Zacho mentioned they have financial strength and operating cash flow to support higher payouts, and aim for a stable but growing payout over time.

Q: What about financing for newbuildings?

A: Gary Chapman stated they are in the process of securing financing, with proposals out to lenders, expecting competitive terms for the 6 newbuild vessels.