C3is Inc. Common Stock 2026 Q2 Earnings Call

Please go ahead. Good morning, everyone, and welcome to the C3is second quarter of 2026 earnings conference call and webcast.

This is Dr. Diamantis Andriotis, CEO of the company. Joining me on the call today is our CFO, Nina Pyndiah. Before we commence our presentation, I would like to remind you that we will be discussing forward-looking statements, which reflect current views with respect to future events and financial performance and are based on current expectations and assumptions, which by nature are inherently uncertain and outside of the company's control. At this stage, if you could all take a moment to read our disclaimer on slide 2 of this presentation. I would also like to point out that all amounts quoted, unless otherwise clarified, are implicitly stated in USD. We have today released our earnings results for the second quarter of 2026.

Let's proceed to discuss these results and update you on the company strategy and the market in general. Please turn to slide 3, where we present the impressive results achieved by C3is for the first six months of the year. Our voyage revenues were $24 million for Q2 2026 compared to $10.7 million for Q2 2025, an increase of 124%. For the first six months of the year, our revenues were $35.6 million compared to $19 million in 2025, an increase of 84%. Our net revenues were $17 million for the quarter, an increase of 185% compared to Q2 2025. For the first half of the year, our revenues were $27.4 million compared to $11.8 million in 2025, an increase of 132%. Our net income was nearly $10 million for the quarter compared to a loss of $5 million in 2025, a 287% increase.

For the six months, we had a net income of $13 million compared to $2.6 million last year, a whopping increase of 409%. Our adjusted net income was $9.8 million for the quarter compared to $1.1 million in 2025, a massive increase of 755%. For the first six months of 2026, our adjusted net income increased by an impressive 562% to $15.3 million compared to $2.3 million in 2025. By the end of June 2026, our cash balance went up 123%, from year-end 2025 to $33.2 million. By the end of July 2026, the balance went further up to $48 million, an increase of 222% from year-end 2025. At $12 million, our EBITDA went up a remarkable 426% in Q2 2026 compared to -$3.7 million for Q2 2025. For the six months period, our EBITDA jumped by 176% to $16.7 million compared to $6 million for the six months 2025.

On slide 4, we summarize and highlight the company's performance. For the second quarter of 2026, the time charter equivalent rate of our fleet, which is the voyage revenues less voyages expenses divided by the voyage dates, increased by 145% compared to Q2 2025, reaching $40,300. The TCE rate of our Aframax tanker for the same period was $133,500, an increase of 202% compared to Q2 2025. For the first 6 months of 2026, the TCE rate of our fleet increased by 125% compared to 6 months 2025, reaching $36,800. The TCE rate of our Aframax tanker for the same period was $105,700, an increase of 151% compared to 6 months 2025. Following on the vessel strategy of growth and diversification, C3is has had 5 vessel acquisitions since inception: an Aframax oil tanker in 2023, a bulk carrier in 2024, and 2 product tankers in 2026.

We have thus increased our fleet capacity by 387% compared to our fleet when we commenced operations. Our capital expenditure for the 2 product tankers delivered this year is $39.78 million. This will become due in January 2027. As of July 2026, our cash balance was $48 million, amply meeting our future financial obligations. As of June 30, 2026, the average age of the fleet was 16.8 years, including the new additions. None of our fleet are Chinese-built, hence no risk of potential U.S. tariffs. Our EPS for the second quarter of 2026 was 353.87 and 483.39 for the first 6 months of 2026. Our net asset value per share for the first 6 months of 2026 was 12.83. Using the share price at closing on August 25 of 2.67, we were trading at a discount of 380%. We had 2 public offerings this year.

The first one was an ATM agreement in February 2026 with $2.7 million gross proceeds so far. The second one was a share offer in July 2026 with gross proceeds of $6 million. Slide 5 shows the Handysize demand and the time charter average rates. In January to June 2026, global exports of world dry bulk commodities on Handysize/Supramax tonnages reached 910.7 million tons. The iron ore picture is bearish on price and bullish on distance. Chinese steel demand remains subdued and benchmark price has eased towards the low 90s per ton, and yet the freight read is positive. The ramp-up of Simandou and continued West African volumes lengthen average hauls so ton-miles can grow even as the headline price softens. Guinea is expected to become one of the world's leading producers of iron ore.

The high-grade Simandou iron ore is suitable for conversion into steel via less carbon-intensive methods. Coal is regionally divided. Chinese seaborne thermal imports have softened on strong domestic output and hydro, while demand across the rest of Asia Pacific has firmed and Gulf-related energy prices have made seaborne coal more competitive for Asian buyers. The Middle East conflict has opened a forward dimension that did not exist at the start of the year. With a LNG shortfall of around 35 million tons this year after damages to the Gulf export infrastructure, gas-exposed power systems in Japan, South Korea, Taiwan, and Southeast Asia are running coal harder, and dependent estimates point to an additional 70 to 90 million tons of Asia Pacific thermal coal demand in 2026, with China comparatively insulated by its low gas penetration.

Grain and oilseeds are resilient, and soybean trade is forecast at about 189 million tons in 2026/2027, a fresh high, with Brazil alone exporting over 117 million tons and China importing around 114 million. Rice trade is at a record, with India accounting for about 40% of exports. Minor bulks and bauxite remain a quiet structural support. The signal shift in tone from maximizing volume to preserving value marks a change after years of record growth. Indonesia pulls the other way over the long run. Its 2023 raw bauxite export ban took it out of the seaborne export market, and the domestic refinery build-out is lifting its bauxite requirements from around 15 million tons in 2025 towards 25 million this year, with mine output lagging, so a future seaborne import pool cannot be ruled out. For the rates, several factors weigh beneficially on the dry bulk market.

The stronger Far East demand for coal is a ton-mile support for the segments that carry the trade. Coking coal has been the firmer sub-segment, with Chinese coking coal and coke prices reaching the highest since late 2024 and Indian metallurgical imports up about 32% in 2025. The adoption of China's five-year plan in March 2026 covers 2026 to 2030 and rests on high-quality development, technological self-reliance, stronger domestic demand, and a deeper green transition. For dry bulk, it matters less as a stimulus signal than as confirmation of where Chinese commodity demand is heading, and reinforces the distance over price thesis. As steel makers urgently seek to reduce their carbon emissions, demand is increasing for higher grade, lower impurity iron ore, the essential feedstock in the production of steel. The Simandou mine is a very large, high-grade iron ore deposit in Guinea.

The mine holds an estimated 2.4 billion tons of ore grading 65% iron, making it one of the largest untapped iron ore resources in the world. At $23 billion, the project is the world's most capital-intensive mining project, with China and Singapore owning 80% of the mining rights. El Niño impacted the Panama Canal, resulting in a lower level of water, thus forcing shipping through the routes of U.S. Gulf and East Coast grain and coal towards longer voyages, which is ton-mile positive. A notable thread for the next half is India, where weak monsoon concern has already pushed the country to import soybeans, a reminder that the El Niño transmission into agriculture is beginning to register.

The major Middle East conflicts and disruption around the Strait of Hormuz have reshaped the shipping market, yet dry bulk has stayed relatively insulated and has in places benefited from longer routings. Slide six shows the Aframax LR2 rates and ages. The spot rates for Aframax tankers are currently experiencing fluctuations based on current market conditions. North Sea to Continent, June 2026 average rates recorded was $116,749 per day, the highest percentage increase compared to the average rate over the last five years. With an average daily spot rate of $34,727 over the last five years, this was an increase of 236% from the last five years' average. The highest average spot rate from the last five years was on the Med route at $37,316. The conflict in the Middle East has stranded tankers and throttled global trade.

China and Russia have been gearing up for what could be a record season along the North Sea Route. Disruptions to trade due to fighting around the Red Sea and the Strait of Hormuz may push the shifting dynamics along the Northern Sea Route as the safest and most reliable and efficient route. Due to the deepening economic and geopolitical ties between Russia and China, transits along the Northern Sea Route hit a record high last year, hinting at a new transit milestone. On the Aframax fleet, by the end of the second quarter of the year, there was a 3.51% increase in the total fleet. The global Aframax fleet now stands at 1,239 vessels, of which 291 vessels are over 20 years of age, accounting for 24% of the total number of vessels.