Hafnia's Share Buyback Program: A Strategic Move for Enhanced Shareholder Value

Hafnia Limited, a leading product tanker company, has announced a significant share buyback program, signaling a strategic commitment to enhancing shareholder value. The company aims to repurchase up to 18 million shares, valued at up to USD 100 million, from December 2, 2024, to January 27, 2025. This move comes amidst robust financial performance and a strong balance sheet, reflecting Hafnia's dedication to returning value to its shareholders.

Hafnia's share buyback program is set to have a notable impact on the company's capital structure and financial performance. By reducing the number of outstanding shares, the buyback program will increase earnings per share (EPS), making shares more attractive to investors. This move aligns with Hafnia's dividend policy, ensuring that the combined total of dividends and share buybacks adheres to the targeted payout ratio.

The reduction in outstanding shares, assuming constant net earnings, will likely boost EPS. For instance, if Hafnia's net earnings for 2024 remain at the reported USD 694.4 million for the nine months ended September 30, 2024, and the company repurchases all 18 million shares, the EPS would increase from USD 1.36 to approximately USD 1.41. This demonstrates the potential impact of the share buyback program on EPS.

The timing of Hafnia's share buyback program coincides with a period of robust financial performance. In Q3 2024, Hafnia reported a net profit of USD 215.6 million, a 46% increase from Q3 2023, and a record net profit of USD 694.4 million for the nine months ended September 30, 2024. The company's strong earnings, coupled with a net asset value (NAV) of approximately USD 4.6 billion, reflect the increased market value of its vessels and robust operating cash flows. Furthermore, the company's net Loan-to-Value (LTV) ratio decreased to 19.1% at the end of the quarter, indicating a strong financial position.

Hafnia's share buyback program is a strategic move that signals confidence in the company's future prospects and commitment to shareholder value. By reducing the number of outstanding shares and increasing EPS, the buyback program enhances the attractiveness of Hafnia's stock to investors. This move, combined with the company's strong financial performance, positions Hafnia well for future growth and success.



As part of this strategic move, Hafnia has authorized management to initiate the share buyback program, subject to market conditions. This program is set to run from December 2, 2024, to January 27, 2025, during which Pareto Securities AS and its subsidiary, Pareto Securities Inc., will repurchase shares on behalf of the company. The repurchases will be made through open market transactions on the Oslo Stock Exchange (OSE) and the New York Stock Exchange (NYSE), with a maximum of 18 million shares to be repurchased for a total amount of up to USD 100 million.

In conclusion, Hafnia Limited's share buyback program is a strategic move that aligns with the company's strong financial performance and commitment to shareholder value. By reducing the number of outstanding shares and increasing EPS, the buyback program enhances the attractiveness of Hafnia's stock to investors. This move, combined with the company's robust balance sheet and positive financial trends, positions Hafnia well for future growth and success. Investors should carefully consider the potential benefits and risks associated with Hafnia's share buyback program and monitor the company's progress as the program unfolds.