Precious Shipping Public Company Limited (PSL) Earnings Call Transcript & Summary

[Foreign Language]

As usual we will divide the presentation into 2 halves. In the first half, I will talk about the industry structure. And in the second half, Gautam will walk you through the financials of the company. Coming to the first slide, which is on China. You can see clearly that China has outperformed in the first half of 2024 despite all the issues that they were facing. Their iron ore imports were up by 6.1%, coal imports were up by 12.5%, steel production was marginally down at 1.7%. If you look at steel exports, it was up by 22%. Overall, if you look at China, I think they've done very, very well. If you come to the next slide. Here, you can see we are talking about the Chinese property market. So this was an article which came out in the South China Morning Post and was written by an economist who compared 3 markets: China, America and Japan. And what he understood from that, I'm trying to summarize for you. It says that any residential property market reaches bubble territory once you have a property development that represents more than 7% of the GDP. In China, this ratio hit 12% in 2013, but for this year, it's expected to be just 5.5%. So no longer in bubble territory. The second thing they said is that a prolonged contraction in transactions for resale homes says that you are in bubble territory. But in China, in 2023, Chinese resale homes transactions actually surged by 44% by floor space. The third thing to look at is that in the last 30 years, China has built 14.4 billion square meters of salable homes. And if you examine the per capita urban space requirement, it's at 38.6 square meters. That means this 14.4 billion square meters that has been created can house only 370 million people, which is just 40% of its existing 920 million urban population. If you look at China, it's on track to increase this urbanization from 65%, which is the current rate to 73% by 2035. This will mean that you will add another 100 million people to the urban population, and they will all require housing. Therefore, latent demand for housing is substantial. The other thing to look at is that the Chinese home price index has slid by 9% from its 2021 peak. Now when you have a fall in residential property prices, and where the population is investing a large portion of their savings in that, then that creates what is known as a negative wealth effect and therefore, you would find that the consumption of the Chinese person will reduce. We'll come to the next slide. Now on this slide, what we're trying to show you is that answering the question that, will China's housing sector woes lead to a financial crisis? And the answer is a resounding no. And the reasons for that are as follows: one, the average loan-to-value ratio of home mortgages in China's major cities is about 50%. So therefore, property prices have to fall by 50% before the mortgage is underwater. Secondly, home loans, when you default on them in China, you are liable for the full loan on your personal name. It means that you are, like, giving a personal guarantee against your housing low. So most Chinese will not default on their own loans. Thirdly, the bank's exposure to developers is less than 5% of the loan book, and it's completely collateralized. So banks are well capitalized at more than 15% of capital adequacy ratio-type of situation. And the average NPL ratio is about 1.6%. So I think the banks in China are pretty solid. Regulatory requirements for banks is to reserve more than 100% of their defaulting loans. Therefore, from a bank's point of view, it makes no sense to hold on to a housing loan, which has gone bad. They will immediately sell the property in the market and, therefore, remove the problem from their balance sheet. So the housing crisis continues to retard China's economic recovery. If you look at the past few years, what you would see is that the GDP growth rate would have been 4% higher in 2022 if there was no property crisis; 1.3% higher in 2023, if there was no such crisis; and an expected under 1% higher in 2024, if there was no such crisis. So it has definitely affected the GDP growth rate. And bankruptcies or property companies rose 5x from 123 in 2022 to 590 in 2023. So a lot of them have been let go and this has slowly released the air from the property bubble that was there in China. In the U.S., as an example, residential properties represent only 25% of household wealth, and there is no personal guarantee given by the homeowner to the mortgage. But in China, this represents 59% of their wealth, and they've given a personal guarantee to their banks. And therefore, this creates an issue for them to default. If you go to the next slide. Now here, what we've tried to show you is that what has been the average steel consumption in China on an annual basis between 2018 and 2022. Therefore, for a 5-year average, it works out to about 953 million metric tonnes of steel consumed per year. Now if you look at the 2023 number, it worked out to 971 million metric tonnes. Therefore, it was 2% above the 5-year average. And you can see that in the percentage changes, you can see that yes, real estate is consuming 11% less steel than the 5-year average, but all other sectors are doing much better, especially when you look at exports, it's really running at a very high pace. So that's the main reason why, even though China's property sector has come down quite significantly in terms of construction, you still don't have a problem in the steel industry sector. If we come to the next slide. Now on this slide, we are trying to show you what the Chinese government has stated on the 17th of May 2024. And they said that local governments are, first of all, allowed to buy unused properties and unused land. This will release a lot of pressure from the local governments -- rather from the property sector with the local government coming in and buying all these properties. Second thing, they've relaxed the mortgage rules for buyers. Now, in between, China tightened these rules because they didn't want people to keep investing in properties. Now they relaxed that rule. The third thing is they've done is that they've pledged to deliver unfinished homes to stranded purchases. And then finally, they've pledged 2 amounts of money. One is $42 billion to banks to lend onward to the property sector. And the second thing they've done is they've issued what is known as a very long bond. They have issued a CNY 1 trillion ultra-long sovereign bond to further support local governments. If you come to the next slide. Now here, what you see is that the government is focused on alternate steel consumptions like infrastructure and manufacturing to take the pressure of the real estate sector to consume so much steel. Secondly, steel exports have grown dramatically by 35% in 2023 and further by 22% in the first 6 months of this year to 53.4 million metric tonnes for the first 6 months. In terms of electric cars and ship construction, they've done really well, and they're supporting the steel consumption in the country. If you look at the Q1 freight market, it surprised the industry as it was much stronger than anticipated. It was the strongest, what do you call it, the strongest first quarter in the last 10, 15 years. If you look at Handy, Supra and Ultra ships, which is where we are located, we benefited from China steel exports, leading to a very strong Pacific market. If you go to the next slide, please. Now this slide shows you that how these measures have not become very effective because credit data from the People's Bank of China in April showed negative growth for the first time since 2005. That means companies are not borrowing more than what they were borrowing in the past. If you look at the $180 billion for the property sector, which the Chinese government has put in play, $42 billion plus the CNY 1 trillion, it pales in comparison to the $700 million that the U.S. spent in the 2009 residential property crisis that they faced. If you look at the U.S., they had significantly increased tariffs on imports from China. So therefore, again, putting a crimp on the Chinese economy. If you look at the European Union and U.K., they are forced to employ similar tactics as the U.S.A. and raise tariffs. What have they done? They've imposed at tariff of between 17.5% and 38% on Chinese electric cars on top of the existing 10% import tax that they already have. And then China is, like, may not buy grain from America because America might put an export tax on grain to China, but they can certainly buy it from South America or Latin America, and coal from Russia, instead of from America, and that will support our markets, Supras and Ultras. If we come to the next slide. Now if you look at India's performance, again, very, very strong performance. Iron ore exports were up by 7.8%; rice exports were up by 24%; coal imports were up by 11.4%; steel production was up by 14.8%; steel exports -- imports was up by 29.3%; steel exports were up by 3.9%; and the most important one, steel consumption in the first 5 months was 58.8 million metric tonnes, up by 11.5%. So again, the second largest -- second strongest performing market in the world of a large economy was India, and they did really well for the dry bulk market. If we come to the next slide, this shows you what has been the total change in terms of trade, in terms of tonne-mile demand. So if you look at the fourth -- the third line from the bottom, it shows you how change in trade has taken place. So if you look at that line, you can see that in 2023, it had the highest growth rate, 4.46%. And if you look at the average for 2024, it's expected to be 3.88% and for 2025, it's supposed to be 0.89%. Now if we come go to the next slide, we will see what it has done in terms of tonne-mile demand for the minor bulks, which is what we carry a lot of. So if we look at that again on the third line from the -- third row from the bottom, you can see that the highest growth rate was in 2021 at 5.63%. And now in 2024, we expect to have the second highest growth rate at 4.85%. And in 2025, it's expected to be to 2.45%. At the same time, if you look at the supply side in our sector, you can see that in 2023, it was growing by 3.3%; in 2024, it's expected to grow by 4.1%; and in 2025, it's expected to grow by 3.8%. So if we come to the next slide, we can see here that Clarksons does get their forecast completely wrong. So if you're looking at 2024 tonne-mile trade growth in billions of tonne miles, you can see that in January 2023, 1 year before, we were forecasting a rate of 2.02% for the full market and 2.82% for the minor bulk market. And then if you look at what's happened by the June '24 edition, those numbers have changed from 2.02% to 3.88%. And then if you look at the minor bulks, it's gone from 2.82% to 4.85%. So you can see clearly Clarksons, with all their sophisticated models to calculate and predict what the tonne-mile demand should be, they are not able to get it right. Similarly, for fleet growth, if you look at what they were predicting for 2024 at the start of 2023, it was showing as an overall growth of 0.3% for the overall market, all bulk carriers put together, and 0.86% for the small Handysize, for the smaller ships, the geared sector. And if you look in June, the same thing is showing 3.1% for the overall growth rate and 4.1% for the small Handy sector. So we come to the next slide. Here, we can see trade growth for 2025. What were they predicting in January 2024? They were predicting 1.58% overall growth and 3.22% for the minor bulk sector. And then if you see in the May edition, they were showing 1.14% for overall growth. That means it's coming down. And for the minor bulks, it were the 2.85%. And then if you look at the June edition, what are they showing? Overall growth of only 0.39%, but for the minor bulk, it's at 2.45%. Similarly, if you look at the lower portion of the slide, it shows you how the fleet growth has taken place. It was predicted at 1.1% at the start of this year and -- for 2025. And for the minor bulk, minor ships or the geared sector, it was shown as 1.8%. And then in March, those numbers changed to 2.2% and 2.3%. And then, if you look at the June addition, it's changed 2.6% and 3.8%. So you can see, they are not able to get even the supply side absolutely correct. So we come to the next slide. Now this shows you what -- how much time ships of different sectors are spending on different commodities. So if you look at Capesizes, they spent 73% of the time in iron ore, 18% of the time in coal and 9% of the time they spend on a minor bulk cargo called alumina or bauxite. Now this is from Guinea where the Chinese on the bauxite mines, they also own the rail line transporting the bauxite to the port, and they also own the port, which helps them load big ships very, very quickly. So that's what the Capesize sector is doing. If you look at Panamax, 7% on iron ore, 52% on coal, 25% on grain and 16% on minor bulk. Again, this 16% is mainly Guinea bauxite coming out going to China. If you look at the Supras and Ultras, what do you see? 6% iron ore, 21% coal, 15% grain, 57% minor bulk. And if you look at Handysize, 65% of minor bulk. So you can see clearly that we are focused more on the minor bulk sector. So Gautam, next slide, please. Yes. Now this gives you what's happened in the first half of this year. So if you look at the last -- the lower half of the slide, the last column, you can see that the growth rate in millions of deadweight tonnes was 2.77% -- or 2.77 million deadweight tonnes for the Handysize sector, 5.34 million deadweight tonnes for the Supra/Ultra sector. But if you look at the bigger sectors, it was 4.74 million for Panamax and 4.84 million deadweight tonnes for the Capesize. So out of the 17.7 million deadweight tonnes, which was net excess tonnage was created in the first half of this year, almost 9% or 9.5% was straight from the bigger size and 8% was from the smaller size. So you can see clearly that we are growing in an absolute deadweight tonne terms at a slower speed than the bigger ships. Come to the next slide, please. Yes. So now this gives you what is the forward order book. So if you look at the forward order book, it is 92.27 million deadweight tonnes or 9.1% of the existing fleet as of the 1st of July 2024. And if you see at that time, the 20-year-old fleet, -- if you go to the next slide, you can see that the 20-year old fleet was at 9.07% compared to the order book at 9.1%. So almost at the same level that you can see. If we come to the next slide. Now here, what we're trying to show you is what has happened in the past big bull run in 2003 to 2009, in that 6-year period; what has happened in the 2010 to 2020 in the 11-year period; and then average for the 2021, 2022 period; what happened in 2023; and finally at the -- in the first half of 2024, what's happened. So if you look at these numbers and if you go to the fifth line from the top. You can see -- fifth row from the top, you can see that the average growth rate in tonne -- billion tonne miles was 5.5% in the 2003 to 2009 period. Then it dropped to 4.3% in the 2010 to 2020 period. And then dropped further to 1.4% in the average for the 2021, 2022 period. And then came down -- came up to 4.46% in the 2023 period, and now is forecasted at 3.18% for the 2024 year. Now when you look at this, and you see that 1.4% was the demand growth rate in the 2021, 2022 year, yet those are the years where PSL made a profit of $137 million in 2021 and $139 million of profit in 2022. And the reason for that is that those were the years when the congestion levels due to COVID were very high, and they soaked up a lot of tonnage. Now if you look at 2023, on the other hand, though demand growth rate was so high, we did not do as well in 2023. We made a much smaller net profit for that year. Now the reason for that is that all the factors that really helped us in 2021, 2022 to make a lot of money, they were absent in 2023. So congestion came down. Now if you look again, at the right, at the bottom, the last row and see what was the average net supply growth in each of these periods of time for each of the years, you can see it was 6.8% in the 2003, 2009 level. Then dropped to 6.4% per annum in the next 11 years. And then 3.3% as an average for each of 2021 and 2022. And then to 3.1% in 2023. And finally, it's predicted at 3.1% in 2024. So you can see clearly that demand/supply does make a difference and how we can -- and how the rates change with that. If you come to the next slide. Now this shows you the average speed. Now of course, average speed also makes a big difference. If the average speed is high, then you will see that there's more supply available in the market. If the average speed is lower, then it reduces the supply available in the market. And the formula is very simple. For one knot decrease in speed for any 1 sector, then that sector will find that there -- or if you take the overall dry bulk fleet, if it slows down the speed by 1 knot, you will find that you will reduce supply by 5.5%. So we come to the next slide. This shows you port congestion. Now how it's measured here is in the -- in millions of ships -- or rather in millions of days that the ships are in port of the entire dry bulk fleet. So if you look at it that way, then it shows you, in 2019, what was that number; in 2020, how it grew 1.5%. 2021 grew by 6.6%. As I said, '21, '22 at the maximum congestion and 2022 grew by 5.2% over 2021. And then it started to drop, and it was 1.23 -- 1.6% less in 2023. And if you look at the doubling of the first 6 months in 2024, then you would see that 2024 would be equal to -- slightly higher than 2023 at 0.1%. Now what is this based on? It's based on ships which are 65,000 tonnes and above. So it's mainly for the Panamax and the Capesize sector. So here, you can see that the database basis is based [ on ] 7-day moving average of vessels entering and leaving a defined port. Then, of course, it tells you that the number of ships at global ports peaked at 116.03 in 2022 and dropped 114.23 in 2023. So these are all the data that Clarksons have given us. If we come to the next slide, here -- the real difference between 2023 -- or rather 2024 to date -- or between 2021 and '24, if you see the real difference and compared with 2003 and 2009, at that time, there was so much more ordering of ships. And here, if you look at it -- if you look at the first half of 2024 and compare the BDI with the first half of '23, '22 and '21, you see that it is above the first half of 2023 by 59%. It is less than 19% compared to 2022 and less than 19% compared to 2021. And we compared that with the amount of ships ordered in 2024 in the first half of this year. It is at 17 million deadweight tonnes compared to 25.75 million in the first half of 2023. That is 34% less. And compared to 2022, 11% less. And compared to '21, 41% less. So why are we ordering less ships? And the reasons for that are fourfold. The first one is, of course, it's that LNG, container, car carriers, gas and tanker ships have taken away all the available slots. So no real slots available for the dry bulk ships who have been crowded out. The earliest you can buy a ship now, brand new, is in 2027. Secondly, shipyard capacity compared to the peak is down by 35% to 40%. And there are 180 active large yards in -- there were in 2022 versus 320 in 2009. So you can see large yards have come down in numbers. And thirdly is despite owners having a lot of cash, the main concern people have is this fuel transition. And since we don't know what the new fuel of the future is going to be, nobody is willing to bet on it, especially in the geared sector, where there are no ships being ordered, even on a dual-fuel basis. Finally, main engine availability is a significant constraint. So even though yards are trying to increase capacity, they are not able to get enough main engines from the manufacturers who have not upped the capacity. And that's, again, a big constraint. And that's the reason why, more or less, the forward order book is equal to the existing ships in the dry bulk fleet on a day rate tonne basis. If you go to the next slide, please. So what are the key industry takeaways? What are the things that you should focus on? The first thing is, of course, the IMF growth rate. So if you look at that, then you will see that IMF estimates that world GDP growth rate should be 3.2% in 2024 and will increase to 3.3% in 2025. The IMF has also forecast China's GDP growth rate at 5 -- at -- IMF and the Chinese government forecast China's GDP growth again at 5% in 2024, lower than the 5.2% growth in 2023. China's Q1 and Q2 GDP growth had stood at 5.3% and 4.7%. So average sales for the first half of the year was 5%. In terms of tonne-mile demand growth of 4.46% in 2023, this was driven mainly by China's economic recovery. Steel consumption in China was marginally negative, but it was supported by shipyards, electric car makers, infrastructure and steel exports. If you look at the fixed asset investment, it was plus 3% in 2023 and plus 3.9% in the first half of 2024. And consumer spending had rebounded, though it was weak. If you look at the dry bulk fleet growth by 3.1% in 2023 and it's forecast again to grow in a steady way by 3.1% in 2024. But net supply will be further reduced due to lower speeds and compliance with EEXI and CII. If you look at the low water and look at the disruption, the factors that have led to a lot of increase in demand, there's low water at the Panama Canal, disruption at the Suez Canal because of the Houthi bombing. There's congestion at South and North American grain ports. The climate change, extreme weather events have resulted in disruptions, increased tonne-mile demand, delays at sea and congestion. And all this has helped to push up rates and supply/demand balance continues to improve. If you go to the next slide, please. So what has been our strategy? Our strategy has been to try and look at renewing our fleet as we go along. So if you see today, we've got 37 ships. The average age is still at 11.9 years, even though we have advanced by half a year since the start of the year. And if you look at the overall size of our fleet, it's remained roughly the same at 44,000 tonnes. So come on the next slide. This shows you how we -- what have we done. So if you look at the ships sold, that's the first -- first column and the second column and the third column, you can see that we have sold ships which were -- the first ship was 22 years old that we sold. The second ship was 11 years old, which we sold. Third ship was 19 years old, which we sold. We sold them at $6.6 million for the first ship, $13.66 million for the second ship and $10.75 million for the third ship. More to the deadweight of the ships that we sold. The first ship was 28,000, the second ship was 53,000 and the third ship was 33,000. And if you look at the speed of all these ships, it was 12 knots. And if you look at the consumption, it was 19.5 tonnes for the 28,000-tonner, 26 tonnes per day for the 53,000-tonner and 19.5 tonnes per day for the 34,000-tonners. Against that, we bought 2 ships so far, which have already entered the fleet. One is Hansa Naree, one is Hatthaya Naree. So if you look at them, one was built in 2018, so 6 years old. The other was built in 2015 or 9 years old. If you look at the prices that we paid, $25.25 million for the first ship and $18.6 million for the second ship. If you look at the deadweight, they're roughly 40,000 tonnes each. And if you look at their speed, it's the same as the 12 knots of the other ships and -- but look at the consumption, 16.3 tonnes in 1 case and 16.5 tonnes in the other case. So you can see clearly that we are replacing our older ships, which are much higher fuel consuming ships with much lesser fuel consuming ships and the deadweight is also stronger. So we come to the next slide, please. So this shows you the way our ships are have fared compared to the index ships. So the index ship for the Baltic Handysize sector is 38,000 tonnes. Our ships average 31,000 tonnes. Despite that, we were only at a 8.24% discount to the index ship. If you look at the Supras and Ultras, you can see clearly that we were at a 2.38% increase. Come to the next slide, please. So now this is a forward book, and you can see that we are increasing our forward book exposure. And you can see clearly that our total forward booked income is $179 million. If you come to the next slide, please. So with that, I will hand over to Gautam to take you through the highlights of the financials of the company.

Thank you, Khalid. So Q2 2024 highlights. In the second quarter, we had a net profit of about THB 529 million or USD 14.36 million or THB 0.34 tonne per share. Our EBITDA was THB 842 million or $22.84 million. We paid 2 dividends so far this year. We paid a final dividend of 5 Satang on 3rd of May, and we paid also an interim dividend, #1 for 2024 of 10 Satang on 7th June. As we mentioned, so we sold a couple of ships as well, already delivered to buyers. And we've also bought more ships. We bought the Hansa Naree, the Hatthaya Naree. In addition, we also signed 4 ship building contracts to build 4 Ultramax bulk carriers at [indiscernible] in China. And we also signed an MOA to acquire 4 secondhand Handysize bulk carriers. In terms of employment, so 5 of our ships were on long-term fixed rate time charter contracts. And at the end of Q2, we had 16 ships that were on index-linked time charters for 1 year or longer. So the key figures in Q4 -- sorry, in Q2, our revenues -- and this is now in U.S. dollars, our revenues were $47.2 million compared to the Q1 figure of $44 million. Because of this, the net profit was higher. It just came in at $14.4 million compared to $11.4 million. Of course, the earnings per share was also higher, $34 to a tonne compared to $26 a tonne. Return on equity was 8.59% compared to 7.6%. Our debt continued to reduce, so the net debt-to-equity ratio at 0.26 compared to 0.28. And the number of ships is 36 at the end of the quarter compared to 37. Of course, this will increase as we take delivery of the ships that we have ordered and bought in the secondhand market. Over here, we show you the average time charter per ship -- rate per ship per day, the average rate. And you'll see that the Q2 average rate was the highest it's been in the last 5 quarters. Same for EBITDA. EBITDA was the highest it's been for the last 5 quarters. This over here, we show you the dividends. And the cash balance, we had a very healthy cash balance of $75 million at the end of Q2. This is a statement of financial position. So essentially, our balance sheet. And you'll see at the end of the second quarter, we had $492 million in shareholders' equity. We had debt of $202 million. We had cash of $75 million, and we had $593 million of assets -- fixed assets that is primarily the ships and other assets of $43 million. So cash movement in Q2. So we started the quarter with $46 million of cash. We generated $20 million from operations. The CapEx, which is, essentially, to pay for the secondhand ships was $28 million. Cash from sales of vessel was $25 million. Interest expenses, about $4 million, and we had a loan -- we draw down a loan, $32 million. We had debt repayments, $8 million; dividends, $6 million; and at the end of the quarter, we had $75 million. This is a breakdown of our operating expenses per ship per day, the average operating expenses. So overall, the picture for Q2 was quite healthy. Our operating expenses in the quarter were -- came in at $5,226, which was below the Q1 figure of $5,379. Overall cost, I would say, were fairly stable. Over here, we compare our OpEx to the average OpEx for Supramax and Handysize vessels in the industry. You'll see that we are about $400 lower than the industry average. Every $100 in savings translates to about $1 million on the bottom line. Okay. So here we show you the -- we compare our OpEx and our G&A to some of the listed peers in the Supramax/Ultramax sector. And you will see that in terms of our costs, we are lower than all our listed peers. And over here we show you the EBITDA for a ship as -- which also takes into account, of course, the revenues. And we have done quite well, in fact, [ too many ] of half years. We are at $0.77 million of EBITDA per ship in Q1. We only have data for Q1 because Q2, some of these companies haven't reported that financials as yet. This is our debt maturity profile. You see that our debt is -- it is -- there is no major maturities due in the short term. It's fairly evenly spread out, and that's by design. We've been very active with the refinancing over the last year, and we have stretched out the maturities of many of our loans. We have refinanced some of the loans, released some securities, et cetera. And you're seeing that reflected over there and this is an ongoing process. So this will keep getting stretched out over time. This over here is the net debt to net debt-to-equity ratio. So you'll see that our net debt-to-equity ratio is the lowest that it's been in a very long time. Net debt is $127 million. Okay. So over here, we show you the -- okay, so the top line, these are the average age of ships in our fleet. So you'll see that from 2005 until 2011, we had a fairly elderly fleet Thereafter, we started to take delivery of ships that we had ordered at various shipyards, mainly in China. And then the average age came down to 5.8 in 2016. Thereafter, we were not very active in the shipbuilding market and so that we -- the average age went up. But of course, we are starting to now sell some of our older ships and replace them with younger ships. And so therefore, the average hasn't increased as of the end of the first half of 2024. Over here, we show you the red line, we show you the average deadweight of ships in our fleet, and you'll see the average deadweight of ships in our fleet from 2005 until 2010 was only about 25,000. Thereafter, we started to build larger ships. We got into the Ultramax segment, and the average size of ships in our fleet went up about 44,000 deadweight. Over here, we showed you the time charter -- average time charter rate per ship per day in our fleet. And so you will see that because of -- mainly because of oversupply of ships, the rates declined from about 2008 until 2015, '16. Thereafter, the supply pressures abated and rates have gone up on better demand-supply fundamentals. The line at the bottom is the average OpEx for our fleet over time, and you'll see that's very stable, of course, increasing with inflation. This is dividends that we paid over time. Our policy is to pay not less than 25% of net profit as a dividend. And so over time, we have paid generally more than that. And there was a gap, of course, during the downturn from 2014 until 2021, but we resumed our dividends in 2021 and have paid dividends consistently since then. Okay. So this is the financial highlights. There's lots and lots of figures here, which I will not go through, which I can leave as a reference slide. Okay. Just here on shareholder returns. So if you were an investor in our IPO in the year 1993 and if you held on to our shares until today and you also reinvested all the dividends that you received back in PSL shares, you would have on a 15.76% IRR. So just to compare ourselves to other dry bulk companies listed in the U.S. So this is data that we've taken from an article that was published in August 2023, where it shows it's a really bad idea where -- the writer said it's a really bad area to invest in dry bulk companies and they showed all these U.S. companies where they basically lost money after investing in the IPO. Of course, they did not include PSL in the analysis. Had they done that. They would have realized that a THB 10,000 investment in 1993 would be worth about THB 966,000 as of April 2024. Just some data on Investor Relations. So just on ESG. I'm going to leave this as a reference slide because I think we're running out of time and I want to leave some time for questions. So let's take some questions.

Okay. So the first question is how will the U.S.'s tariff hiking against Chinese products impact the dry bulk demand in the second half of 2024?

Yes. So sorry, I was on mute. Yes. So on this one, just take an example I'll give you on electric cars. There's a 38% tariff promulgated by the European Union. And just to show -- explain to you what that means, the Chinese entry-level car is sold at $10,000. So if you have a 38% tariff on it, it means the car will cost now $13,800 to the consumer. And what does it mean in terms of the consumer's choice? The consumer has to buy a local car at EUR 35,000, which is, say, roughly $40,000. Against that, they've got to buy a Chinese car at $14,000. So there's no tariff that will make any real difference. Similarly, the second question is that how many PSL ships are scheduled for the dry dock in each quarter of 2024. We don't give out this information to anyone. So I'm afraid that we can't share it publicly for only a few people. So the new secondhand ships that PSL bought recently, I understand that resell prices are up double digits this year. Will they be able to find customers on charter at an acceptable rate? As an example, if you look at the Hansa Naree, we have also actually put it out on the -- to the Stock Exchange of Thailand. We were able to get a fix on our index-linked charter with a hefty premium over the index. So yes, you can get it fixed on a period charter at a very reasonable rate. What are the major growth drivers of minor bulk trade in 2024? So here, there are 2 types of drivers. One is a secular driver and one is a cyclical driver. So the cyclical drivers are actually down because the economies in the world are just trudging along. They're not going up in a very significant way. But the secular drivers, which are there for the minor bulks, they continue to perform, and they are linked more to population growth and urbanization and equality of wealth. Once you get more and more wealth in the hands of the poorer people, they start to consume more meat, which is much more intensive in shipping terms for grain cargoes. When you come to the next question, which is how much is the portion of loans with floating growth rates and what is the average interest rate of these loans, especially for the long-term loans, Gautam?