Navigator Q2 2025 Earnings Report

Navigator EPS Results

• Actual EPS: $0.14
• Consensus EPS: $0.36
• Beat/Miss: Missed by -$0.22
• One Year Ago EPS: N/A

Navigator Revenue Results

• Actual Revenue: $129.64 million
• Expected Revenue: $126.73 million
• Beat/Miss: Beat by +$2.91 million
• YoY Revenue Growth: N/A

Navigator Announcement Details

• Quarter: Q2 2025
• Date: 8/12/2025
• Time: After Market Closes
• Conference Call Date: Wednesday, August 13, 2025
• Conference Call Time: 10:00AM ET

Navigator (NYSE:NVGS) engages in owning and operating a fleet of liquefied gas carriers worldwide. It provides international and regional seaborne transportation services of petrochemical gases, liquefied petroleum gases, and ammonia for energy companies, industrial users, and commodity traders. The company also offers ship shore infrastructure and consultancy services. It operates a fleet of 56 semi- or fully-refrigerated liquefied gas carriers. The company was formerly known as Isle of Man public limited company and changed its name to Navigator Holdings Ltd. in 2006. Navigator Holdings Ltd. was incorporated in 1997 and is based in London, the United Kingdom.

Navigator Q2 2025 Earnings Call Transcript

Key Takeaways

• Neutral Sentiment: In Q2, revenue fell 12% YoY to $130M amid geopolitical disruptions, yet EBITDA reached $72M (adj. $60M), showcasing business resilience.
• Positive Sentiment: The balance sheet strengthened to $287M cash and $300M refinancing at a record low margin, enabling a €0.05 dividend and completion of a $50M share buyback.
• Positive Sentiment: TCE rates averaged $28,216/day with 84% utilization in Q2, while early Q3 data show utilization rebounding above 90% and rates normalizing.
• Positive Sentiment: Navigator ordered two 51,500 m3 dual-fuel ammonia carriers on five-year charters, aided by a Norwegian government grant, advancing its fleet renewal and ammonia supply chain role.
• Positive Sentiment: At the Morgan’s Point JV terminal, throughput more than tripled to 268,000 tonnes in Q2, with additional offtake contracts expected to bolster ethylene exports.

Presentation

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Welcome to the Navigator Holdings conference call for the second quarter twenty twenty five financial results. On today's call, we have Mads Peterzaco, chief executive officer Gary Chapman, chief financial officer Oygen Lindeman, Chief Commercial Officer and myself, Randy Gibbons, Executive Vice President of Investor Relations and Business Development here in North America. I must advise you that this conference call is being recorded today. As we conduct today's presentation, we will be making various forward looking statements. These statements include, but are not limited to, the future expectations, plans and prospects from both a financial and operational perspective and are based on management assumptions, forecasts and expectations as of today's date, 08/13/2025, and are as such subject to material risks and uncertainties.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Actual results may differ significantly from our forward looking information and financial forecast. Additional information about these factors and assumptions are included in our annual and quarterly reports filed with the SEC. With that, I now pass the floor to our CEO, Mats Peterzakko. Please go ahead, Mats.

[Mads Peter Zacho, CEO at Navigator Holdings]

Thank you. Good morning, and good afternoon, and thanks a lot for joining this Navigator Gas earnings call for Q2 twenty twenty five. As a start, I'll just review the key data on our Q2 twenty twenty five performance and then go over the outlook for the rest of the year. After that, as usual, Garry and Oevin and Randy will discuss our results in more detail. Geopolitical backdrop for our Q2 result was certainly unusual and very difficult.

[Mads Peter Zacho, CEO at Navigator Holdings]

Ahead of and during the quarter, we experienced a number of significant challenges, including the announcement of U. S. Port tariffs, unprecedented high import tariffs on commodities that we transport, ethane export licenses, which were effective export bans and new military conflicts flaring up, including the bombing of Iran's nuclear facilities. Several of the conflicts receded during and after Q2, but the effect on our customers and our business during Q2 brought a lot of uncertainty, disruption and hence, lower trade volumes. The quarter also brought new opportunities such as ambient temperature LPG exports out of Iraq to Asia and the opportunity to buy back our own shares at a high discount to our estimated NAV.

[Mads Peter Zacho, CEO at Navigator Holdings]

So this was a quarter of shipping at its worst and at its best. Please turn to Slide number four. With that background and moving to our results, in Q2, we generated revenues of $130,000,000 down 12% compared to the same period last year. This reduction is the direct result of customers halting new business and for a time even, in some cases, canceling committed fixtures with us for which we still got paid. However, notwithstanding the backdrop, we generated EBITDA of $72,000,000 and adjusted EBITDA, which excludes $12,000,000 book gain from selling Navigator Venus of $60,000,000 and that showed really the resilience of our business.

[Mads Peter Zacho, CEO at Navigator Holdings]

Earnings per share was €0.31 The gain on the sale of Navigator Venus gives credence to the estimated net asset value. We did a lot of work optimizing our capital structure during the second quarter. The balance sheet is very strong with a cash position of $287,000,000 at quarter end. It was supported by the $300,000,000 refinancing, which was signed and drawn down as planned and at the lowest margin ever for Navigator. The return of capital continued in Q2 with both the €05 fixed dividend and a share buyback up to in combination 25% of net income.

[Mads Peter Zacho, CEO at Navigator Holdings]

We also progressed the additional $50,000,000 share repurchase program, completing $30,000,000 in Q2 and the remainder in July. So done and dusted, 3,400,000.0 shares bought back at an attractive price. Randy will elaborate on this one in a few minutes. Commercially, we achieved average TCE rates of $28,216 per day during Q2. This is lower than the approximately $30,000 achieved in previous quarters.

[Mads Peter Zacho, CEO at Navigator Holdings]

We achieved utilization of 84%, also lower than prior quarters. Our ethylene spot fleet was impacted the most, whereas the semi ref fleet fared better. Throughout throughput at our joint venture ethylene export terminal rebounded to 268,000 tonnes for the quarter, which was more than 3x Q1, but still below full capacity. We are pleased to announce the two fifty one thousand five hundred cubic meter dual fuel ammonia vessel orders and the associated five year time charter contracts. The combination of attractive yard prices, the grant from the Norwegian authorities and expected attractive financing makes this transaction accretive to shareholders and strengthened Navigator position in the ammonia supply chain.

[Mads Peter Zacho, CEO at Navigator Holdings]

It's also an important step in our gradual fleet renewal and goes hand in hand with our sale of older vessels like Navigator Venus. We expect to be able to report more sales of older tonnage and associated book gains as the year progresses. Looking forward, we also expect that most of the headwinds that we saw in Q2 are gone. Global trade in commodities we transport have restored during July and into August. So today, we see utilization and rates returning to normal levels.

[Mads Peter Zacho, CEO at Navigator Holdings]

We expect LPG exports from Iraq to Asia to continue and we expect ethylene exports from U. S. To Europe and ethane exports from U. S. To Asia to continue.

[Mads Peter Zacho, CEO at Navigator Holdings]

The latter will be further supported by the opening of Enterprise's new Beaumont terminal that will free up more ethane export capacity. This means more business for our ethylene and ethane vessels. Of course, discussions between U. S. And its trading partners continue and much can still change.

[Mads Peter Zacho, CEO at Navigator Holdings]

But with our diversified customer base, trading capability and strong balance sheet, we remain resilient even if geopolitics take an unexpected turn. So now over to you, Gary, and talk a little bit more about the details on our financial result, please.

[Gary Chapman, CFO at Navigator Holdings]

Thank you, Mads, and welcome, everybody. During this quarter, as Mads mentioned, we've seen a number of geopolitical announcements and events across the world that have affected our markets that we were not able to predict or foresee at the beginning of the year, or indeed some of them we were not able to predict at the beginning of the second quarter. However, I'm very pleased to report that despite the unpredictability that we've experienced, we're able to report a healthy set of results, not as high as we would like, but focusing on our strengths, we've been able to maintain solid progress in many areas across the quarter, and we believe we're also able to look forward to a strong second half of the year. Our second quarter twenty twenty five financials show a healthy result due to the quality, diversity and flexibility of our fleet and business, which allowed us to maintain charter rates and utilization at profitable levels, supported by our operational efficiency and cost controls. On Slide six, we report TCE of $28,216 per day, leading to a quarterly net operating revenue of $129,600,000 and an EBITDA of 71,900,000.0 Our lower TCE this quarter came about primarily due to the performance of our ethylene vessels across the quarter, stemming from the trade licensing and tariff related issues that Mats has already mentioned and that Oivin will also cover.

[Gary Chapman, CFO at Navigator Holdings]

Whilst our fully refrigerated handysize fleet also did not perform so well, we only have six vessels in this category. In contrast, our semi refrigerated and midsized vessels performed almost as normal throughout. So overall, the quarter was affected by certain specific global issues that we do not believe are long term, and we're seeing a bounce back already in our third quarter performance to date. We sold one of our oldest vessels, as mentioned, the Navigator Venus, for net proceeds of £17,500,000 resulting in a strong book gain of £12,600,000 in the quarter. And excluding this from EBITDA as the main difference, we get to an adjusted EBITDA result of £60,100,000 Hence, the vessel sale in this quarter made up for the sequential drop in earnings, leaving EBITDA for this quarter at £71,900,000 broadly in line with our first quarter twenty twenty five result.

[Gary Chapman, CFO at Navigator Holdings]

Then for the reasons we've already covered, utilization was 84.2% in the second quarter, down 9.2% compared to the 2024. Sorry. You will see that voyage expenses have decreased by £1,900,000 compared to the same quarter last year, mainly due to lower utilization in the second quarter this year as these are pass through costs to our customers. Hence, they're reflective of the decrease in operating revenue. Vessel operating expenses were up compared to the 2024 at $47,400,000 with the increase primarily driven by the increase in our fleet following the purchase of the three secondhand vessels in the first quarter of this year, which you can see is reflected in the table shown bottom right, as well as simply the timing of maintenance costs incurred during the three months ended 06/30/2025 compared to the same period in 2024.

[Gary Chapman, CFO at Navigator Holdings]

We do currently expect to close the year on or close to budget for our OpEx costs adjusting for the extra vessels. Depreciation is also slightly up compared to previous quarters due to our now increased fleet. Unrealized movements on nondesignated derivative instruments resulted in a loss in the second quarter of 1,400,000.0, this being related to movements in the fair value of our long term interest rate swaps, which affects net income but which has no impact on our cash or liquidity. Our income tax line reflects current tax and mainly deferred taxes primarily derived from our investment and share of profits in our ethylene export terminal at Morgans Point. Randy will shortly explain more about their terminal throughput volumes in the second quarter, but they were up to 268,000 tonnes from 85,000 tonnes in the previous quarter, resulting in us reporting a profit this quarter of 4,800,000 Then overall for the 2025, net income attributable to stockholders was 21,500,000.0 with basic earnings per share of 31¢.

[Gary Chapman, CFO at Navigator Holdings]

Our balance sheet, shown on slide seven, continues to build and be strong with a cash, cash equivalents and restricted cash balance of $287,400,000 at 06/30/2025, which if you include our available but undrawn liquidity, was $316,000,000 at the same date. This is despite paying out $26,400,000 for scheduled loan repayments, $6,800,000 under our return of capital policy in respect to the 2025, and a further $29,600,000 of share buybacks as part of the new $50,000,000 share repurchase plan. Our liquidity in the quarter was boosted by the 40,000,000 bond tap issue that was settled in early April, the sale of the Navigator Venus, which completed in May, and the debt refinancing that we drew down in mid June twenty twenty five, which added a 142,000,000 of net liquidity. Including our available but undrawn revolving facilities, we had $314,000,000 of restricted cash at close on 08/11/2025. On slide eight, we show a summary of the main capital events across the quarter where, with a very supportive banking group and a strong underlying business, we were able to return capital to shareholders, extend our debt maturity, boost our liquidity, and reduce our finance costs.

[Gary Chapman, CFO at Navigator Holdings]

We completed our latest share repurchase program on 07/30/2025, having bought back $50,000,000 of our common stock, and Randy will also provide some more details on this shortly. We continued to pay out under our return of capital policy at a level of 25% of net income, and we sold one of our oldest vessels, the Navigator Venus, as we've mentioned, for net proceeds of 17,500,000.0, resulting in a book gain of 12.6. Also in May, we entered into a new senior secured term loan and revolving credit facility of up to $300,000,000 that was used to repay the company's existing September 2020 and October 2023 secured outstanding loan facilities of $143,000,000 and $15,000,000 respectively, and thereafter be available for general corporate purposes. The facility has a tenor of six years maturing in 02/1931. Amounts outstanding bear interest on a quarterly basis at Soffa plus 170 basis points, and the facility is secured by eight of the company's vessels.

[Gary Chapman, CFO at Navigator Holdings]

And then following our successful issuance of 100,000,000 of new senior unsecured bonds in October 2024, which at the time closed with the lowest spread for an unsecured US dollar denominated shipping bond in the Nordic market since 2000 and We took advantage of favorable market. And on 03/28/2025, we successfully issued a further 40,000,000 tap of our bonds, which also priced at 7.25 percent, which funds settled with us in early April right at the start of the second quarter. The borrowing limit under the bonds is $200,000,000. Hence, a further 60,000,000 is available to us as the aggregate principal amount to be issued by the company under the bond term should we choose to do so in the future. We now have only two relatively small debt maturities due in the next twenty four months with balloon payments due in 2026 of $54,000,000 in total.

[Gary Chapman, CFO at Navigator Holdings]

On the right hand side of this slide is a summary of our main debt movements across the last quarter, which also demonstrates our progress in reducing our cost of debt, which is ongoing and which is possible due to the strength of our business and the confidence in Navigator of our banking partners. Our next priority is to close finance in relation to our now six newbuild vessels, and this work is already ongoing with several options being pursued. We're currently targeting to complete this work within the next six months. On slide nine, our leverage against earnings remains in a strong position with net debt to adjusted EBITDA at 2.7 times for the last twelve to 06/30/2025. In the quarter, we returned $36,400,000 to shareholders through a combination of cash dividends and share buybacks.

[Gary Chapman, CFO at Navigator Holdings]

And by the July 2025, that figure had risen to $56,800,000 as we completed our new 50,000,000 share repurchase program. We also made substantial loan repayments of 26,400,000.0 in the quarter as mentioned, and our net debt to on water fleet value, I. E. Loan to value ratio, was 34%. And if you include and ascribe a value to our terminal at Morgan's Point, that ratio falls to below 30%.

[Gary Chapman, CFO at Navigator Holdings]

As we have shown before, we're continuing to make substantial debt repayments with around a $124,000,000 of average annual scheduled debt amortization payments expected across the coming three years, 2025 to 2027, to manage our financial risk but whilst also still being able to raise more capital to invest and to grow. On slide 10, this remains one of our most important slides showing our estimated all in cash breakeven for 2025, which at $20,270 per day is significantly below our average TCE revenue even for this slightly softer 2025 of two $28,216 per day, the difference being nearly $8,000 per day. The all in breakeven rate shown here is materially unchanged from the estimate we provided on our last earnings call back in May 2025. And this estimated cash breakeven figure is all in and includes forecast scheduled debt repayments and our scheduled drydock commitments. On the right hand side is our updated OpEx guidance for 2025 across our differing vessel size segments ranging from 8,050 per day for our smaller vessels to 11,100 per day for our larger, more complex ethylene vessels.

[Gary Chapman, CFO at Navigator Holdings]

This guidance is unchanged from our last quarterly call in May 2025. And following below is further next quarter and full year guidance across vessel OpEx, general and admin cost, depreciation, and net interest expense in total dollar terms. The full year guidance for vessel OpEx towards the bottom is now slightly lower in total than the previous guidance given in May 2025 as we have one less vessel across the remainder of 2025. Net interest expense is also a little lower than the previous guidance given in May 2025. Slide 11 outlines our historic quarterly adjusted EBITDA, adding this second quarter's figures and demonstrating that whilst this quarter was not another record due to the political issues we've discussed particularly impacting our ethylene and ethane capable vessels, still remains a very positive result.

[Gary Chapman, CFO at Navigator Holdings]

On the right hand side of the slide, we show our historic adjusted EBITDA for 2024 and our last twelve months adjusted EBITDA. In addition, the EBITDA bars then to the right provide some sensitivity and illustrate an increase in adjusted EBITDA of approximately $90,000,000 for each $1,000 incremental increase in average time charter equivalent rates per day. In terms of an update on our vessel's dried up schedule, projected costs, time taken, we've moved this slide to the appendix as although this is important information, the slide itself is quite data heavy. On this topic, we're continuing to invest in our energy and fuel saving initiatives, which we believe are great investments to make both for financial and environmental reasons, where they're also typically showing very short payback periods. So with that very quick run through, I will hand you over to Oyvind who can provide some more color on the commercial environment that we have seen and what we are seeing today. Oyvind?

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Thank you, Gary, and good morning, everyone. Let's turn to Page 13 for the rate environment. Despite market uncertainty and various geopolitical curveballs, the Handysize market actually held up pretty well during the second quarter, all things considered. The Handysize ethylene twelve month time charter rate stayed steady at around $36 per day or $1,100,000 per month. Semi refrigerated rates dipped a little, settling about $30,000 per day, and fully refrigerated rates saw the largest correction, ending the period at $25,000 per day.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

We only have six out of our 58 vessels in that segment, three of them on time charters, so the overall impact on us was small. Two things worth keeping in mind. Firstly, as you can clearly see, these rates are well above our all in fleet breakeven of $20,270 per day. Secondly, having three vessel categories gives us great diversification, spreading exposure across petrochemicals, LPG and ammonia and cushioning us against market swings. Historically, we see external factors impacting the three markets in very different ways, and this was the case in this second quarter.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Page 14, earnings days. We always show our earnings days mix in our presentations. And this time around, LPG really stands out for this second quarter. When The U. S.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Ethane export license slowed down demand for our ethane capable vessels, other parts of the fleet benefited from incremental demand elsewhere in the world. In this case, for more LPG exports from Iraq, we added three extra vessels into that trade during the quarter, pushing our fleet LPG earnings days to a two year high, almost matching that of petrochemicals. This is a real example of how the fleet versatility kicks in. One market is down, another one is up. Another good sign, as you can see to the far right, is our July utilization, which was which hit 90%, suggesting the market is settling into a more normal steady state.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

So between the diversification and this normalization, our earnings are already looking healthier. Page 15, utilization. The top left graph illustrates our five year highs and lows for our fleet utilization. You can see the green dotted line representing year to date dip in second quarter for reasons that Mats and Gary already mentioned. But as you can see, it then rebound five points in July.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

We have always maintained that any utilization above 90% represents quite a healthy market, and we are in this zone today. The other graphs show the benefits of diversification. LPG employment is growing in our semi refrigerated segment, and utilization is rising across all three vessel types. Page 16, ethane. Ethane and ethylene exports from U.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

S. Makes up a fair portion of our petrochemical vessel demand. And it makes sense then to address the ethane export license restriction and its immediate and short lived impact. Firstly, let's take a step back and look at why U. S.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Ethane matters. The U. S. Has a major cost advantage in producing ethylene from ethane, matched only by The Middle East. European and Asian naphtha based producers are placed much higher on the cost curve.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

So for them, importing U. S. Ethane or ethylene can dramatically improve their cost position and sustain their operations. China is the largest buyer of U. S.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Ethane. When the export license requirement came in effect during May and June, trade to China essentially stopped. But it was short lived. Exports rebounded in July, hitting a record high. Almost immediately, new spot requirements for handysize ethane vessels were quoted in the market.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

In addition, that same month, Enterprise newly constructed Beaumont ethane Export Terminal began operations. Extra terminal capacity means more demand for ships like ours. As an aside, one of our vessels loaded the very first cargo from the new Beaumont Terminal. Page 17, Europe's ethylene rationalization. As mentioned, European producers are facing a challenging position in the ethylene cost curve.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Many of these producers are shutting down uncompetitive plants. The first graph is showing a downward trend in European ethylene production capacity. The good thing for us is that the Europeans are leaning towards US to backfill lost ethylene production with imports. In July, the Europeans imported 75% of their seaborne demand from U. S, the highest portion on record.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

This trend is likely to continue. Instead of producing at high cost, they import from a more competitive producing country, I. E, The US. I've added Italy as an example, and you can see there's after shutting down their own production, there's a sudden spike in US imports of ethylene. Page 18, US ethylene exports.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Even though US ethylene prices have risen since April, which is the bottom left graph, the gray line. Delivered prices in Europe are moved in lockstep. The theoretical transatlantic ethylene arbitrage is about $210 per tonne for freight, more than enough to support the trade. In recent months, nearly all U. S.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Ethylene exports have gone to Europe, reinforcing the structural long short dynamic between the two regions. Page 19, vessel supply. Vessel supply remains well balanced. Just 12% of the Handysize segment is on order or 9% if we exclude four CO2 carriers on order. And 22% of the fleet is over 20 years of age.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

So in summary, second quarter was messy at times, but July brought a welcome return to normality, higher utilization and rates maintaining well above breakeven. In addition to the day to day freight trading, we've been working on some other exciting developments, which Randy will talk to. Over to you, Randy.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Thank you, Oyvind. So, yeah, following up on several announcements we've made in recent months, we want to provide some additional details and updates on our recent developments. Starting on Slide 21, we're pleased to announce our return of capital for the 2025. But before we get into that, I want to highlight that during the second quarter, and specifically as part of our return of capital policy, we repurchased more than 234,000 common shares of NVGS totaling $3,300,000 for an average price of $14.12 per share. Now looking ahead, in line with our return on capital policy and the illustrative table below, we're returning 25% of net income or a total of $5,400,000 to shareholders during this third quarter.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

The board has declared a cash dividend of 5¢ per share payable on September 17 to all shareholders of record as of August 28, equating to a quarterly cash dividend payment of $3,300,000. Additionally, with the shares trading well below our estimated NAV of $28 a share, we'll use the variable portion of the return of capital policy for share buybacks. As such, we expect to repurchase another $2,100,000 of NVGS shares between now and quarter end, so that the dividend and the share buybacks equal 25% of net income or $5,400,000 this quarter. Now continuing on the topic of share buybacks, let's turn to slide 22. During the first quarter call in May, we announced a new $50,000,000 share buyback program.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

And as you can see, the announcement was not just to make a positive headline, but we immediately put it to good use and recently completed the program by repurchasing 3,400,000.0 shares at an average price of $14 and 68 per share. As you can see in the bottom left chart, we had about 56,000,000 shares outstanding for many years. And that was up until the merger with Ultragas in 2021, in which we issued 21,000,000 shares in exchange for 18 vessels at an implied value of $16.82 per share. Since then, we've repurchased more than half of those shares back or 11,800,000.0 shares totaling $166,000,000 for an average price of $14.15 per share. For further details, look at the table in the bottom right, slide 20 through '23.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

So as we've said before, there are several compelling reasons for us to repurchase shares. You know, buying them back at a discount boosts the NAV per share, reduces the share count, increasing our EPS, supports the share price, diversifies the uses of cash to that five pillars of capital deployment. And as you've seen over the past few years and even more so over the past few months, returning capital to shareholders will remain a primary focus for us going forward. Now turning to our ethylene export terminal on slide 23. Following the first quarter of very low throughput, volumes during the second quarter more than tripled to 268,000 tons as multiple U.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

S. Gulf ethylene crackers ramp production resulting in lower U. S. Ethylene prices, allowing us to utilize the Flex Train in both May and June. Looking at the bottom right chart, despite a recent increase in U.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

S. Ethylene prices, European prices have also increased. So we expect third quarter volumes to remain firm near second quarter levels. And longer term, U. S.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Ethylene prices are expected to stay at an attractive level for the coming quarters and years. Additionally, with the widening of the arbitrage, we have completed multiple spot cargoes in recent months, many of which have discharged ethylene to new ports throughout Europe. As for contracting the expansion volumes, following the original contracts, we've signed two new offtake contracts in recent quarters, and many conversations with new customers are progressing. As such, we continue to expect that additional offtake capacity will be contracted in the coming months. Now on slide 24, we are very pleased to announce our recent inclusion in the Russell 2,000, the premier small cap index, and the Russell 3,000 total market index, further expanding our shareholder base and increasing our trading liquidity.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

On May 23, the Russell Indexes announced their upcoming additions including Navigator Gas in both. This is when the active managed funds start positioning their portfolios. Now on June 27, which was this year's reconstitution day, that was completed after market close. And this is a meaningful event as you can see 4,500,000.0 shares of NVGS traded that day. Now as you can see in the chart on the bottom left, both our share price and our daily trading liquidity have increased since May 2020 May 23.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

And taking a longer term view, as you see on the table on the right, daily trading liquidity has increased significantly in recent years with a more pronounced step up in recent months. Our trading liquidity has steadily increased despite that ongoing reduction in shares outstanding as mentioned earlier. Now for the year to date 2025, we're averaging almost 400,000 shares traded per day, totaling almost $6,000,000 per day with several days well above $10,000,000. So with that, there are many funds that require around $5,000,000 of daily trading liquidity, so we are now on the radar screen of a much larger group of investors. Now turning to our fleet.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Starting with the first part of our fleet renewal on slide 25, our fleet renewal program continues to be implemented as we sell our oldest vessels and replace them with more modern tonnage. Starting with the divestiture, in May, we completed the sale of our oldest vessel, Navigator Venus, a 2,000 built, twenty two thousand cubic meter gas carrier to a third party for $17,500,000 resulting in a $12,600,000 profit. That leaves us with only two of our original vessels built in February. And we continue to engage buyers for showing interest in acquiring those older assets. Additionally, we expect to sell another unencumbered vessel during the third quarter in line with current market valuations, resulting in a substantial book gain and cash inflow.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

So as a result of our recent sale and purchase activity, our current fleet is now twelve point two years of age on average with an average size of 20,816 cubic meters. Now looking at slide 26, our average fleet age is set to decrease while our average vessel size is set to increase. In July, we announced a new joint venture in which we will own 80%, and Aemon, our partner in Azane Fuel Solutions, will own 20% to construct two new 51,530 cubic meter ammonia fueled liquefied ammonia carriers. The new buildings are scheduled to be delivered in June and October 2028 at a price of $84,000,000 each. Now importantly, each vessel will receive a 90,000,000 kroner or $9,000,000 grant from the Norwegian government agency, ANOVA, resulting in a net price of $75,000,000.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

And assuming 70% LTV debt financing, we expect the total equity needed to be only around $16,000,000 per vessel, which will be split between ourselves and Aemond. These vessels will be the largest in our fleet. They'll have the dual fuel engines for clean ammonia, and we'll be able to transit both the old and new Panama Canal locks. Additionally, each of the vessels will be employed on a five year time charter upon delivery to a blue chip industry leader. Lastly, in terms of vessel financing and capital needs, we've included that CapEx table on this slide and we're currently targeting to complete financing arrangements within the next six months.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Finishing on slide 27, I want to personally invite all of you to our upcoming twenty twenty five Analyst Investor Day here in Houston, Texas in a few months from now. On Tuesday afternoon, November eleventh, we'll be hosting our Morgan's Point tours of the ethylene export terminal and Flexstrain as well as one of our vessels. So just take a picture take a look at that picture to the right and imagine yourself climbing on board that beautiful ethylene carrier and seeing the flex train operate in all of its splendor. Later that evening, the management team and members of our board will host a dinner for our analysts and investors. Then the next day, November 12, we'll host company and industry presentations covering current market trends, our financial update, as well as our medium term strategy.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

We'll then have lunch followed by an appreciation event for analysts, shareholders, customers, and partners. And looking at the Farmers Almanac, the weather is expected to be fantastic, so we hope to see you in November. With that, I'll now turn it back over to Mads for closing remarks.

[Mads Peter Zacho, CEO at Navigator Holdings]

Good.

[Mads Peter Zacho, CEO at Navigator Holdings]

Thank you very much, Randy, and let's move to page 28. So it's it's time to summarize an eventful second quarter where waves of port fees and import tariffs and export licenses tested our resilience and negatively impacted our profitability. But we did not sit on our hands during Q2, because Q2 was also a quarter of opportunities where we took advantage of strong financial markets and optimized our balance sheet. We lowered the cost of debt and used excess cash for buying back 5% of outstanding shares at attractive prices. And we look through the fog and we took another step in positioning Navigator as a leader within not only the ethylene ethane supply chain, but also the clean ammonia supply chain.

[Mads Peter Zacho, CEO at Navigator Holdings]

Q3 has come off to a robust start and we now see a normalization of our operating environment. By any further geopolitical surprises, we expect to be back on the previous trajectory. This will be driven by the continued growth production and the significant build out in U. S. Export infrastructure over the next four years.

[Mads Peter Zacho, CEO at Navigator Holdings]

We expect this will support exports of natural gas liquids and thereby also transport demand for the products that we carry. And as in previous quarters, the vessel supply picture remains attractive with small handysize order book and an aging global fleet. So thanks a lot for listening, and I'll hand it back to you, Randy, now for the Q and A.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Thank you, Matt. Operator, we'll now open the lines for some Q and A. So to raise your hand, press star nine, and then you'll have to unmute yourself by pressing star six. Or if using Zoom, just use the raise hand function. So first question, your line is open.

[Omar Nokta, Managing Director at Jefferies]

Hey, Randy. Hi, guys. This is Omar Nokta from Jefferies. As usual, very detailed presentation, and just had a couple of follow ups to that. And maybe just in terms of the business from a big picture perspective, the, obviously, 2Q was was quite volatile with the geopolitics kinda really having a pretty significant impact.

[Omar Nokta, Managing Director at Jefferies]

Sounds like from your commentary that third quarter and the second half in general is gonna be quite a bit better. Just in terms of how we think about that, do you think 3Q as a whole can return to how things were prior to, you know, the second quarter? Or is it more of a gradual improvement you see in the third quarter, and it's really the fourth quarter where things start to get back to normal. Yeah.

[Mads Peter Zacho, CEO at Navigator Holdings]

And I can't help thinking back to when we had this discussion back in the middle of Q2 talking about the Q1 result. At that time, we were looking at port fees that had disappeared for our segment. We also saw the trade war between China and U. S. Kind of receding.

[Mads Peter Zacho, CEO at Navigator Holdings]

But then came the export licenses, which were really a surprise. And even though at the time we argued they were coming, they would be a bargaining chip, they did lead to some disruption and some reduced utilization for our feed in Q2. So when we talked a quarter ago, I thought that maybe we communicated that we were seeing a gradual improvement, but then came this NOK. That's different now, because now the effects have gone away. And as Euwine was talking about, we see the utilization back up at just above 90% for July.

[Mads Peter Zacho, CEO at Navigator Holdings]

And we can also confirm that the rates have reacted similarly. So we would say that Q3 as a whole is back to the levels that we saw before Liberation Day, and and we see a normalization of of the business in q three, then we'll deal with q four once it comes. But so far, that looks good too.

[Omar Nokta, Managing Director at Jefferies]

Okay. Very, very good. Thank you, Mads, for for that. So good good to hear. And then just wanted to ask about the terminal contracts.

[Omar Nokta, Managing Director at Jefferies]

You mentioned the the two contracts were signed here recently for the expanded part of the the terminal, and, also, it sounds like there's potentially more in the works in the next few months. Justin, can you give us maybe a sense of, you know, what portion now do you have of the expansion that that that's now contracted? And then maybe as a overall, in terms of the 1.55 of total capacity, how much of that is is contracted?

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Yeah. We we thanks, Omar. We don't wanna go into too many of those details because we're still having those commercial conversations. So we won't go into the the quantum of the new contracts, but it's certainly a a large portion. We have four existing off take customers.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

We have multiple term sheets out to many new customers, especially here in the last few months when we've been doing a lot of these spot cargoes, they have been to new customers. Right? So that's why we do expect additional longer term off take contracts to be signed here in the coming months. Duration, still to be determined. Some want just a couple years, some want multiple years.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Whereas in terms of size, it ranges as well. So there's still a lot of variables to be determined, but we should have more updates on this in the November call.

[Omar Nokta, Managing Director at Jefferies]

Thanks, Randy. I appreciate that. I understand the sensitivity. And maybe just one final one, and and I'll pass it back. And and it's kinda maybe just back to the terminal in terms of, you know, the capacity of the one five five and the potential to ratchet that up to as potentially as high as three depending, I think and and correct me if I'm wrong in terms of I think it's enterprise.

[Omar Nokta, Managing Director at Jefferies]

They they sort of direct the the the flexing potentially of the of of the the the volumes that would switch from, say, ethane to ethylene. And and so as as I think about or as we think about going into '26, do you know when that decision is made on how much of of that capacity will end up being ethylene?

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Yep. It's it's really gonna be on a month to month basis. Now there's a few positive developments. One is the Beaumont facility, the Neches River facility, is now online for Enterprise. One of our vessels took the inaugural cargo very recently here.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

So now that there's a new ethane export facility for Enterprise to operate out of, that frees up some capacity at Morgan's Point. Secondly, the new ethane storage tank, which you've been out to to Morgan's Point, the we have the ethylene storage tank in place for almost five years now. They are just now completing or soon to complete their ethane storage tank. So that will also give them more flexibility, some optionality around the cargo switching between ethane and ethylene. And it is an enterprise decision operationally, but really it's a market decision.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Right? If the customers and the off takers want ethylene, they can switch it to ethylene pretty much immediately. Right? The damper setting is it only takes a couple hours. So it's really gonna be a every week decision in terms of flexing between ethane and ethylene.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

But for those two positive developments, the new terminal in Nitches River as well as the ethane storage tank will give us more optionality for more ethylene cargoes above and beyond the 1,550,000 tons in coming years.

[Omar Nokta, Managing Director at Jefferies]

Understood. Thanks, Randy. Thanks, guys. I'll pass it back.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Thank you, Omar. Next up, looks like Clement Mullins. Your hand is raised.

[Climent Molins, Head - Shipping Research at Value Investor's Edge]

This is Clement Molins on from Ball Investor's Edge. Thank you for taking my questions. I wanted to start by asking about the ammonia carriers you recently ordered. Does the Innova grant come with strings attached, Or are those minimal? And should we think about the grants as a kind of a one off? Or could this be repeated in the future?

[Mads Peter Zacho, CEO at Navigator Holdings]

Thanks for that question. And there are always strings attached when it comes to to grants. They're really linked to the, you could say, the technology features of the ship, the add ons that you would put on had it been compared to, you could say, a regular fossil fueled ammonia carrier. So this is for this is paying partly for the ammonia propulsion, but also many of the other bells and whistles that we are adding in terms of energy efficiency for the vessel. So it is to fund, you could say, the upgrade compared to a very standard vessel.

[Mads Peter Zacho, CEO at Navigator Holdings]

But that being said, it doesn't mean that we need to burn, you could say, a high percentage of ammonia during the first couple of years. It doesn't mean that we can't trade or we have to trade, let's say, near Norway or similarly. It is for global trading, and then we have a lot of flexibility in operating these ships. So so it's a very attractive grant because it doesn't really limit us in anythings that we wanted to do on it. So it'll they'll be operated on on Norwegian flag, which is a very efficient and professional flag.

[Mads Peter Zacho, CEO at Navigator Holdings]

So in all aspects, this is a pure add on and a pure benefit for us without any downside, really. That's helpful. The question is around whether it can be repeated, then the question then the answer is yes, because the Norwegian authorities are really interested in maximizing, you could say, the volume of new green propulsion, green shipping in the world. It's not quite likely we can just do a complete carbon copy of this one. But if we were to be innovative and take a further step onwards, there would be opportunities for this.

[Mads Peter Zacho, CEO at Navigator Holdings]

They recently granted another grant to to Amon for for bulk carriers, and and and there's more coming here also.

[Climent Molins, Head - Shipping Research at Value Investor's Edge]

That's very helpful. Thank you. And Randy, you mentioned you continue to engage potential buyers to divest the remaining 2,000 build handy sizes. Once those vessels are sold, should we expect you to redeploy proceeds on more modern tonnage? Or have you already done that with the acquisition of the three millage ethylene carriers and the new build additions?

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Yeah. Oyben, I'll let you take this one.

[Oeyvind Lindeman, Chief Commercial Officer at Navigator Holdings]

Yeah. I mean, once they are sold, the the the funds will go into the the capital allocation program, the three pillars, and they'll be distributed accordingly to which pillar we deem necessary at that time. So it's flexible. We'll put it to work where we deem it's creating value.

[Mads Peter Zacho, CEO at Navigator Holdings]

And maybe I can just add here that if if you were to ask us if there was likelihood the likelihood was that we were going to buy more ships or sell more ships in the near term, it is probably going to be sell more ships. Because I think we have done quite well in both the newbuilding program and also buying the three German built vessels in the spring. So I think we've done most of the work there in renewing the fleet from adding new ones. And I think now we have a little bit of work to do in terms of selling a couple of the older ones.

[Climent Molins, Head - Shipping Research at Value Investor's Edge]

Makes sense. Thank you for taking my questions.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Thank you, Komet. Again, to ask a question, just raise your hand. We've had one come in here just looking at the tariffs. So it seems like the tariff announcements in trade news was negative during the second quarter, but recently, there have been some positive developments around trade deals. So, Mads, how do you think these announcements will impact your business, specifically US commodity exports, going forward?

[Mads Peter Zacho, CEO at Navigator Holdings]

Yeah. I think they will bring much wanted clarity to the customer base of ours and for us to see that we will have a more stable trading environment. And that's always very positive. I mean, what happens is once you get this volatility, you don't quite know where the what the direction is, you tend to step back and say, Oh, let's see how this all falls into place. I think now we have a number of trade deals between The U.

[Mads Peter Zacho, CEO at Navigator Holdings]

S. And its major trading partners. There's still some details to be fully agreed on, but I think we have the overall framework in place. And that gives the stability and the ability for us to forecast for us and our customers, which is really what we've all been looking forward to. So again, we don't know what the future will bring.

[Mads Peter Zacho, CEO at Navigator Holdings]

There will be unknown unknowns. But from how we can see it, we think it's a quite positive development that we get some clarity and some, yeah, some trade deals falling into place. And most of them, they don't really put any tariffs on products that are exported out of The U. S. And into the various other countries.

[Mads Peter Zacho, CEO at Navigator Holdings]

It's mainly been leading to tariffs from imports into The U. S, and we don't do much of that. So in essence, they haven't been put tariffs on much of the transportation that we do.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Thank you, Matt. Gary, this one's for you. For the six new building financings, should we expect similar terms as your most recent debt financings?

[Gary Chapman, CFO at Navigator Holdings]

Yeah. That's a very good question. We are hoping to at least match what we've done in the past. I think at the moment, we've got a number of different structures, and we've got quite a lot of conversations going on with all kinds of different potential capital providers. So I think given the nature of the ammonia vessels in particular, but also the panda vessels, I think we've got six really attractive projects there, and we'll probably group those vessels whether it's six or whether it's four and two or two and four.

[Gary Chapman, CFO at Navigator Holdings]

But, certainly, we will be looking to do those in the next six months. We've got plenty of opportunity, and I think the the capital providers that we're talking to are very keen. And I think we'll get some really good terms. And, certainly, we're shooting for as low as we can get in in the best terms that we can get, and we'll see where that lands.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Perfect. Great. We see another hand raised here. Dalton? Oh, we still can't hear you.

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

Can you guys hear me okay now?

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

We got you now.

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

Okay. Thanks, Randy. Thanks for taking my question, Dalton Willett with Charmos Capital Partners. One one question I had on the new builds that you guys are working on financing out. How do you think about, you know, the the risk of, you know, like, IMO's new new rules for how ships have to be fueled or, you know, carbon related related issues.

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

How do you think about going and making those investments knowing that the, you know, the goalpost could be changed in a six, twelve, eighteen month period? How how are you guys managing that risk?

[Mads Peter Zacho, CEO at Navigator Holdings]

Yeah. I think we should look at the two different order orders that we've made. You could say the four ethaneethylene vessels that we ordered, they're not really they don't really have much of a link to whatever the IMO is putting into place. They will be most likely fueled by ethane, which is incredibly cost competitive compared to regular fuel oil. So they will be having an advantage to pretty much any other vessel in the global fleet regardless.

[Mads Peter Zacho, CEO at Navigator Holdings]

When it comes to the two ammonia carriers, we have the five year contract coverage, which means that we will have a secured return on the ships for the first five years. And what then comes after, we will see. The good news is that those vessels are dual fuel. So even if we were to see a situation where ammonia was less competitive than we had forecasted, they'd still be able to operate very efficiently on regular fuel oil. So in that sense, it they are very flexible vessels, and and they're very attractive regardless of of what the direction of the IMO is going to be.

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

Yeah. No. That's that's helpful. Thank you. And then on the on the kind of the restructuring of the sheet, getting yourself in a better, you know, capital position, can you kinda talk about the the timing of that and and why it made sense to go now versus, say, you know, towards the end of the year?

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

How are you guys thinking about, you know, getting the getting your balance sheet where it is today?

[Mads Peter Zacho, CEO at Navigator Holdings]

Maybe I can just kick us off and you can fill in, Gary, also. When it comes to the share buybacks, I think we've been pretty consistent over the past three years in having share buyback programs at the right point in time during the year, adding or buying back about 5% of outstanding shares. And then on top of that, we have the regular quarterly dividends and share buybacks. That model has kind of worked well for us. So we think it's a good way to do it.

[Mads Peter Zacho, CEO at Navigator Holdings]

It's, of course, up to the board. If they were to decide to do something in addition not, we'll see about that. We have good liquidity in the balance sheet right now. So it gives us a lot of flexibility to allocate between the different opportunities of investing, paying or buying back shares or other uses of of our cash. But, Gary, you can add.

[Gary Chapman, CFO at Navigator Holdings]

Yeah. I mean, I I think we we've taken advantage a lot of the fact that, you know, there's a lot of liquidity out there at the moment. Navigator's in a great place. We've got a a strong business, a flexible business. Our banking partners are very keen to work with us.

[Gary Chapman, CFO at Navigator Holdings]

That's allowed us to refinance, push out the maturities, lower the cost of our debt, and we're we're gonna continue to do that. What that's also doing, it's it's providing plenty of liquidity for these projects that we're doing. You know, we've we've paid $64,000,000 towards the cost of our newbuild panda vessels already. We don't have finance for those vessels yet, but we've paid all of that out of cash so far. So, you know, it buys us some really good flexibility.

[Gary Chapman, CFO at Navigator Holdings]

We've gotta be careful that we don't, you know, carry too much liquidity and too much cash, and and we're constantly monitoring that. But I think at the moment, you know, from our perspective, we've got a a number of older debt facilities that we would perhaps like to refinance and refresh. And so I think there's some work to do on that and and alongside the newbuild vessels as well. So I think we've taken advantage of a of a strong market using our strong business model to be able to do what we've done. We've ended up being able to do pretty much everything that we want to do, including buying back the shares as Mads was talking about.

[Gary Chapman, CFO at Navigator Holdings]

So I think we're trying our best to be efficient with what we do, but also lower the cost of what we do. And and I think we've been able to do that so far, and we expect to be able to continue to do that.

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

Great. Fantastic. Thanks. Thanks for that. I appreciate it.

[Dalton Willett, Equity Research Analyst at Sharmos Capital]

I think that's gonna be the last thing I have. Pass it back to you guys. Thanks so much. Appreciate it.

[Randy Giveans, EVP - IR & Business Development at Navigator Holdings]

Sure. Thank you, Dalton. So that completes our q and a for today. Thank you again for joining us for our second quarter earnings results. We'll be reporting our third quarter earnings results in early November, and hope to see many of you here in Houston on November. Thanks again, and have a great

Participants

Executives

• Randy Giveans, EVP - IR & Business Development
• Mads Peter Zacho, CEO
• Gary Chapman, CFO
• Oeyvind Lindeman, Chief Commercial Officer

Analysts

• Omar Nokta, Managing Director at Jefferies
• Climent Molins, Head - Shipping Research at Value Investor's Edge
• Dalton Willett, Equity Research Analyst at Sharmos Capital