Himalaya Shipping (NYSE:HSHP) reported a first-quarter profit as higher charter earnings lifted revenue and operating cash flow, while management said it remains positioned for strength in the Capesize and Newcastlemax dry bulk markets.
Chief Executive Officer Lars-Christian Svensen said the company generated net profit of $5 million and EBITDA of $24.5 million in Q1 2026. Time Charter Equivalent, or TCE, earnings were approximately $32,300 per day for the quarter. The company declared total cash distributions of $0.18 per share for January, February and March.
In subsequent events, Svensen said Himalaya achieved TCE earnings of about $41,600 per day in April 2026 and declared a $0.15 per-share cash distribution for that month.
Revenue Rises on Higher Charter Earnings
Chief Financial Officer Vidar Hasund said Himalaya reported earnings per share of $0.11 for Q1 2026, compared with a net loss of $6.4 million, or $0.14 per share, in Q1 2025. Operating profit rose to $17.2 million from $6.5 million a year earlier, while EBITDA increased from $13.8 million.
Operating revenue was $33.6 million, compared with $22 million in the same quarter last year. Hasund attributed the increase to higher TCE earnings, which rose from $21,100 per day in Q1 2025 to $32,300 per day in Q1 2026.
Vessel operating expenses increased to $7.4 million from $6.9 million a year earlier, primarily due to higher crew spares, service fees and insurance costs. Average operating expense per day was $6,800, compared with $6,400 in Q1 2025. General and administrative expenses were $1.2 million, compared with $1.1 million a year earlier.
Interest expense declined by $0.7 million year over year to $12.4 million, which Hasund said reflected a lower average loan principal outstanding following repayments.
Himalaya ended the quarter with $24.5 million in cash and cash equivalents. Hasund said the company’s minimum cash requirement under its sale leaseback financing is $12.3 million. The outstanding balance on the sale leaseback financing was approximately $694 million at the end of Q1, down from about $701 million at the end of 2025 due to scheduled repayments. Cash flow from operations was $9.8 million, compared with $0.3 million in Q1 2025.
New Charter Agreements and Ownership Increase
During the quarter, Himalaya entered into new index-linked time charter agreements for the Mount Ita and the Mount Matterhorn. Svensen said the Mount Ita agreement covers 11 to 14 months and the Mount Matterhorn agreement covers 12 to 14 months, both at “significant premiums” to prevailing indices.
After quarter-end, the company also entered into a new time charter agreement for the Mount Emei for 12 to 14 months at an index-linked rate that Svensen said was also at a significant premium to the Baltic Capesize Index.
Himalaya also agreed to acquire an additional 4,200 shares in 2020 Bulkers Management AS from 2020 Bulkers Ltd. for NOK 1.1 million, effective April 1, 2026. The transaction increases Himalaya’s ownership from 40% to 54%.
Management Highlights Spot Exposure and Low Breakeven
Svensen said Himalaya’s fleet consists of 12 modern Newcastlemax vessels with dual-fuel LNG capability and is in the top 1% emission rating for large bulk carriers. He said the company has now made 28 consecutive monthly dividends, supported by its financing structure and capital allocation policy.
Most of the fleet is fixed on long-term index-linked contracts with conversion options. Svensen said the company’s all-in cash breakeven equivalent to the Baltic Capesize Index is approximately $17,300 per day.
“Every time you see the Baltic Capesize Index above $17,300, Himalaya Shipping is turning a profit,” Svensen said.
He said Himalaya’s preferred commercial strategy remains chartering out most vessels on index-linked contracts, which allows the company to capture upside during market increases while preserving flexibility to convert to fixed rates with counterparties when it sees value in the forward freight agreement curve. Currently, Svensen said 11 of the company’s 12 ships are exposed to the spot market.
Since inception, Himalaya’s vessels have traded at an average 48% premium to the Baltic Capesize Index and a 25% premium to peers, according to Svensen. He attributed the premium to extra cargo intake and the fleet’s speed and consumption design.
Dry Bulk Market Outlook Remains Positive
Svensen described the start of the year for the Capesize and Newcastlemax market as the best since 2010. He pointed to large bauxite volumes from Guinea, lower speeds across the overall fleet and increased global port waiting time as contributing factors.
He said Capesize ton-miles increased 4.3% year over year in Q1, supported by a 23% increase in bauxite volumes from Guinea and a 4.8% increase from global iron ore trades. Brazilian iron ore exports were down 1% year over year, while Australian iron ore volumes were up 4%.
Management also highlighted continued Chinese demand for imported higher-grade iron ore. Svensen said domestic Chinese iron ore content is reported to be around 20%, while imported volumes from Brazil and Guinea contain iron content in the mid- to high-60% range. He said this has contributed to a slowdown in domestic Chinese production and sustained preference for higher-grade imported ore.
On bauxite, Svensen said Guinea produced record output in 2025 and that new export records have been registered so far in 2026. He said bauxite now accounts for 20% of total cargo transported on Capesize and Newcastlemax vessels.
The CEO also discussed the Simandou mine, where first iron ore volumes began in November 2025. He said the target remains 120 million tons of exported high-grade iron ore annually and that recent export momentum suggests mine-to-vessel logistics are improving. Himalaya is also monitoring potential capacity increases from Vale, which Svensen said could add further strength to Atlantic export volumes and boost ton-miles.
Supply Constraints and Q&A Commentary
Svensen said the Capesize order book stands at 14% of the existing fleet, while active shipyards are down 60% from the 2008 peak. He said those conditions make it challenging to add enough capacity to disrupt what he described as favorable supply dynamics over the next few years.
He also noted that the fleet is aging, with around 46% of the total Capesize and Newcastlemax fleet built between 2009 and 2015. Close to 30% of the fleet will be more than 20 years old by 2030, he said.
Dry dock requirements are also expected to affect vessel availability. Svensen said 12% of the Capesize fleet was delivered in 2011 and will need 15-year special surveys in 2026. Including five- and 10-year surveys, around 24% of the total Capesize and Newcastlemax fleet will be competing for dry dock space this year. Himalaya estimates 1.7% additional off-hire for the total fleet due to dry docks in 2026, excluding potential congestion and waiting time.
During the question-and-answer session, Eirik Kolskår of Clarksons Securities asked why Himalaya’s market outlook appeared more optimistic than the broader market and the FFA curve. Svensen said the forward curve for Q3 and Q4 had remained fairly stable, while tightness in the Atlantic had helped support current elevated rates. He said he did not believe that Atlantic tightness had been fully reflected in the forward curve.
Svensen pointed to Simandou volumes, strong bauxite volumes in Q1 and a “structurally short Atlantic” as factors that could support future market strength. Asked whether Himalaya would consider fleet expansion given its share price relative to net asset value, Svensen said the company is always looking for accretive opportunities and ways to make the company more interesting for shareholders, while noting its transparent model, counterparties and low G&A.
About Himalaya Shipping (NYSE:HSHP)
Himalaya Shipping Ltd. provides dry bulk shipping services worldwide. The company operates a fleet of vessels. It serves major commodity trading, commodity and energy transition, and multi-modal transport companies. Himalaya Shipping Ltd. was incorporated in 2021 and is based in Hamilton, Bermuda.
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