Himalaya Shipping Ltd. (J1X) Q2 2026 Earnings Report

The call presents a strongly positive operating and financial performance for Q2 2026 with large YoY improvements in net profit, revenues, EBITDA, TCE and cash generation. Management highlighted successful chartering at premiums, a modern low-emission fleet, supportive market fundamentals (rising ton-mile, record exports, low newbuilding orderbook) and clear dividend capacity. Key risks noted include elevated sale-leaseback liabilities, dry-dock off-hire risks and a flat secondhand asset market; management also remains selectively exposed in the forward curve and has deferred covering Q1 2027, leaving some near-term market risk. Overall, the positives — substantial earnings, cash flows, chartering wins and favorable market structure — materially outweigh the lowlights.

Himalaya guided for a continued strong second half of 2026 while largely staying exposed to the upside (10 of 12 vessels spot-exposed) and converting selectively to fixed when the forward curve offers value; management said it is not yet covering Q1 2027 given the 2027 curve around $29,500/day versus Q1 at ~$25,500/day. Key operating metrics underpinning that view include an all-in cash breakeven equivalent to the Baltic Capesize Index of ~$17,500/day, Q2 time charter equivalent (TCE) of ~$50,600/day (July TCE ~ $51,200/day), conversions of four vessels in June at an average $56,500/day and two vessels (Aug–Dec) at an average $51,200/day, new index‑linked charters (Mount Emai 12–14 months and Mount Aconcagua 16–18 months) at significant premiums to the index, and declared cash distributions of $0.59 for Apr–Jun plus a $0.22 July distribution. Financial and market context cited to support guidance included Q2 net profit $24.6M and EBITDA $44M, dividend/yield sensitivity (~18% yield at BCI ~$40k/day; ~34% at $60k/day; ~65% at $100k/day), fleet of 12 modern Newcastlemaxes (top 1% emissions), historical fleet outperformance (avg 48% premium to BCI and 25% to peers), demand drivers (ton‑mile +4.9% y/y; bauxite +7.7% y/y; iron ore +2% y/y; coal ton‑mile +15% y/y), Simandou ramp (target 120 Mtpa; 15–20 Mt projected first‑year contribution), a Capesize order book ~16% of fleet, and supply pressures from dry docks (estimated 1.7% off‑hire in 2026; ~24% of fleet requiring dry dock this year, with only ~30% completed so far).