Klaveness Combination Carriers (KCC) investor relations material

Strategic direction and business model

• Focus on redefining efficiency and sustainability in shipping, leveraging unique combination carrier concepts (CABU and CLEANBU) to minimize ballast and emissions, outperforming standard vessels in both efficiency and earnings.

• Strategy for 2026–2030 centers on expanding the CLEANBU business, diversifying CABU trading regions, and developing new combination carrier solutions, with a strong commitment to decarbonization and shareholder returns.

• Plans to explore new combination carrier concepts (EXBU, CABU III) targeting 30%-40% greater efficiency, with expansion dependent on market and customer support.

• Emphasis on maintaining a disciplined, industrial approach, prioritizing risk-adjusted returns, flexibility to adapt to changing trade flows, and consistent dividends.

• Growth since IPO in 2019: fleet expanded from 8 to 19 vessels, with further expansion and renewal under consideration based on market conditions and newbuild opportunities.

Sustainability and decarbonization

• Achieved a 20% fleet-wide cut in emissions since 2018, targeting another 20% reduction over the next five years and aiming for 5.1 gCO2/tNM by 2030 without support, 4.4 with support.

• CABU and CLEANBU vessels deliver 30–40% lower fuel consumption per transported ton compared to alternatives, with ~10% trading empty versus 30–50% for standard vessels.

• Decarbonization strategy is to be a "smart leader," investing where returns are clear, maintaining flexibility for future regulatory or market-driven changes, and positioning for stricter regulations.

• Despite regulatory delays, the company maintains a leadership position in energy efficiency, with EEOI significantly lower than industry alternatives, and continues to invest in measures with clear financial returns.

• Efficiency gains in the CABU fleet demonstrated by a 15–20% reduction in carbon intensity over recent years through operational and technical measures.

Market outlook and operational performance

• CABU business is centered on Australia, serving resilient industries and growing market share to ~50% for 2024–2025, with further growth potential in Indonesia and Brazil.

• CLEANBU business has proven its concept, gaining acceptance from major oil companies and expanding in both clean petroleum and dry bulk markets, with flexibility to shift capacity based on market conditions.

• Market outlook for 2026 is cautiously optimistic: dry bulk markets have outperformed expectations, with plans to increase fixed-rate contract coverage to 25%-30% next year; tanker markets face higher fleet growth but benefit from flexibility and contract coverage.

• Diversification, contract portfolio, and operational flexibility contribute to lower earnings volatility and downside protection.

• Synergies between CABU and CLEANBU fleets provide operational flexibility, scheduling advantages, and increased leverage in customer negotiations.