425: CMB.TECH Announces Q1 2025 Results, Including Golden Ocean Merger and Billion-Dollar Contract Backlog

CMB.TECH reports a profitable first quarter in 2025, driven by strategic acquisitions, fleet rejuvenation, and significant contract wins, highlighted by a proposed merger with Golden Ocean and a near billion-dollar increase in contract backlog.

Summary

• CMB.TECH reported a profit of USD 40.4 million in Q1 2025, compared to a profit of USD 495.2 million in Q1 2024.
• The company's EBITDA for Q1 2025 was USD 158.4 million, down from USD 550.5 million in Q1 2024.
• CMB.TECH increased its contract backlog by USD 921 million, bringing the total backlog to USD 2.94 billion.
• The company acquired Hemen's stake in Golden Ocean and signed a term sheet for a stock-for-stock merger with Golden Ocean.
• Five newbuilding vessels were delivered: Mineral Portugal, Mineral Osterreich, Mineral Suomi, Mineral Sverige, and CTV Hydrocat 60.
• Sales of vessels generated a capital gain of USD 46.25 million in Q1 2025.
• The sale of three VLCCs in Q1 2025 is expected to generate a total capital gain of approximately USD 96.7 million in Q2 and Q3 2025.
• CMB.TECH and MOL signed an agreement for nine ammonia-powered vessels, with deliveries expected between 2026 and 2029.
• Fortescue and CMB.TECH signed an agreement for an ammonia-powered Newcastlemax, expected to be delivered by the end of next year.

Sentiment

Score: 6

Explanation: While the company reports a profit and increased contract backlog, the significant decrease in profit and EBITDA compared to the previous year tempers the positive aspects. The proposed merger and fleet modernization efforts are promising, but the overall financial performance is weaker.

Positives

• CMB.TECH reported a profit of USD 40.4 million in Q1 2025.
• The company's contract backlog increased significantly, reaching USD 2.94 billion.
• The acquisition of Hemen's stake in Golden Ocean and the proposed merger represent a strategic move to expand market presence.
• The delivery of new vessels and agreements for ammonia-powered ships demonstrate a commitment to fleet modernization and sustainability.
• Capital gains from vessel sales contributed positively to the company's financial performance.
• The company is expanding into low carbon shipping with long term contracts.
• The company is rejuvenating its fleet.

Negatives

• The profit of USD 40.4 million in Q1 2025 is significantly lower than the USD 495.2 million profit in Q1 2024.
• EBITDA also decreased from USD 550.5 million in Q1 2024 to USD 158.4 million in Q1 2025.
• Golden Oceans contribution to the consolidated result from March 12 till March 31 amounts to USD -6.6 million.

Risks

• The consummation of the merger with Golden Ocean is subject to customary conditions, including regulatory and shareholder approvals.
• The tanker market faces structural headwinds, including potential declines in Chinese oil demand.
• The Suezmax segment faces potential oversupply due to a significant increase in the order book.
• The container sector is sensitive to geopolitical events, such as the Houthi attacks in the Red Sea.
• Chemical tanker trade volumes are correlated with global GDP and industrial production trends, making them susceptible to economic volatility.
• There is a potential CTV supply gap in 2026 and beyond.

Future Outlook

The company aims to enter into definitive transaction agreements for the merger with Golden Ocean during the second quarter of 2025 and complete the merger in the third quarter of 2025, subject to customary conditions and approvals.

Management Comments

• Alexander Saverys (CEO) stated that the acquisition of Hemen's stake in Golden Ocean and the proposed merger would propel CMB.TECH to the top of dry bulk shipowners worldwide.
• Alexander Saverys (CEO) noted that the company continues to execute its strategy by rejuvenating its fleet and signing long-term contracts for low-carbon ships.
• Alexander Saverys (CEO) mentioned that the fleet could grow to more than 250 modern vessels if the merger with Golden Ocean is approved.

Industry Context

The report provides insights into various shipping markets, including tankers, dry bulk, containers, and chemical tankers, with analysis of supply and demand dynamics, freight rates, and geopolitical influences. It references reports from industry analysts such as Breakwave Advisors, Goldman Sachs, Clarksons, and others.

Comparison to Industry Standards

• Bocimar achieved average TCE of USD 18,393 per day in Q1, which is 41.5% above the Q1 5TC Baltic Capesize Index (USD 12.998 USD /day).
• Euronav achieved TCE Q1 2025 of USD 35,101 per day USD/day for the VLCCs, and USD 41,391 per day for the Suezmaxes.
• Q2 2025 spot rates to-date: so far 64% fixed at USD 40,636 per day for VLCCs and 59% fixed at USD 42,636 per day for Suezmaxes.
• Bochem achieved TCE Q1 2025 of USD 20,521 per day USD/day (spot pool).
• Windcat CTVs achieved TCE Q1 2025 of USD 2,376 per day (utilization 75.6%).

Management Changes

Stakeholder Impact

• Shareholders will be impacted by the proposed merger with Golden Ocean, potentially leading to changes in ownership and share value.
• Employees may experience changes due to the merger and integration of the two companies.
• Customers may benefit from the combined entity's expanded fleet and service offerings.
• Suppliers and creditors may be affected by the merger's impact on the company's financial stability and operations.

Next Steps

• Enter into definitive transaction agreements for the merger with Golden Ocean during the second quarter of 2025.
• Complete the merger with Golden Ocean in the third quarter of 2025, subject to customary conditions and approvals.
• Pursue a secondary listing on the Euronext Oslo Brs following and subject to completion of the Merger.

Key Dates

Keywords

CMB.TECH, Golden Ocean, Merger, Q1 2025, Results, Financials, Shipping, Ammonia, Vessels, Contract Backlog