Research

Hafnia (Investment Case): Strong cash flow and dividends in the face of geopolitical uncertainty

By Philip CoombesEquity Research Analyst

Summary

Hafnia reported a net profit of USD 110m in Q4 2025, contributing to full-year earnings of USD 340m, and returned 88% of net profit to shareholders through dividends and buybacks.
The product tanker market shows strong momentum entering 2026, with Hafnia booking 76% of Q1 earning days at ~USD 30,000/day, significantly above the operational cash breakeven.
Fleet dynamics are favorable, with limited new orders and aging vessels, suggesting constrained net fleet growth toward the decade's end.
Hafnia offers the highest estimated 2026E dividend yield among peers at ~9%, and trades near its year-end NAV of USD 7.04/share, potentially at a discount due to recent vessel value increases.

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Hafnia delivered its strongest quarter of 2025 in Q4, reporting net profit of USD 110m and bringing full-year earnings to USD 340m. Despite a softer first half as rates came off their 2024 cyclical peaks, the company generated USD 560m in adjusted EBITDA and returned 88% of net profit to shareholders through dividends and buybacks, paying USD 0.55/share for the full year.

The product tanker market enters 2026 with significant momentum. TCE rates have improved for four consecutive quarters, and Hafnia has 76% of Q1 earning days booked at ~USD 30,000/day — well above the operational cash breakeven of below USD 13,000/day. The US-Iran conflict and effective closure of the Strait of Hormuz are pushing tanker rates to record levels, with strength spilling directly from the crude segment into product tankers as LR2 vessels shift into dirty trades, tightening clean supply.

On the supply side, the fleet picture remains constructive. New ordering activity has slowed sharply, while the global tanker fleet continues to age, and sanctions on over 10% of the fleet reduce available capacity in the open market. Hafnia identifies 67m dwt of scrapping potential between 2026–2030 against a 43m dwt orderbook pipeline, suggesting net fleet growth may stay limited toward the end of the decade.

Hafnia trades broadly in line with product tanker peers on forward earnings multiples and stands out on shareholder returns, with the highest estimated 2026E dividend yield in the peer group at ~9%. At the current share price, Hafnia trades close to its year-end NAV of USD 7.04/share - a figure calculated before the recent surge in vessel values, suggesting the stock may now trade at a discount to current NAV. Consensus points to EBITDA growth of ~11% and net income growth of ~18% in 2026E, with potential upside if the current elevated rate environment persists.

Disclaimer: HC Andersen Capital receives payment from Hafnia for a digitalIR/Corporate visibility subscription agreement. /Philip Coombes 16:37 09/03-2026

Hafnia is an international shipping company that specializes in the transportation of oil and chemical products. It started trading in Norway on the NOTC marketplace for unlisted shares in 2013. In 2019 Hafnia listed on the main market in Norway – Oslo Stock Exchange. The company, headquartered in Singapore, operates in the product tanker market, where it manages six pools combining self-owned and externally-owned vessels to benefit from economies of scale. The pools distribute profits/loss across all vessels in the pool, and Hafnia charges a commission for operating externally-owned tankers. Hafnia’s six pools are categorized by vessel size/type, and reflect the fleet of vessels it owns. Its six pools are the: Handy Pool, MR Pool, LR Pool, LR2 Pool, Specialized Pool and Chemicals Pool. The MR and LR pools are considerably outsize the Handy and Specialized pools in terms of revenue and fleet size. Hafnia’s pools are primarily active in the product tanker spot market, but has also recently ramped up on chemical tankers. In addition, Hafnia procures the bunker fuel for its partners at competitive prices for which it receives a commission.