Höegh Autoliners ASA’s shares fell 11.7% in pre-market trading after the company reported quarterly earnings that missed expectations, citing elevated fuel costs and logistical disruptions tied to Middle East rerouting.
The stock dropped $22.50 to $169.80, extending losses from $192.30 at the close of the prior session. The company’s year-to-date return remains strong at 110%, supported by a 9.57% dividend yield and a trailing 12-month return on assets of 20.45%.
The automotive carrier posted Q2 2026 EBITDA of $122 million, a decline of $23 million from the prior quarter but above its guidance. Net profit after tax totaled $86 million, while revenue rose 4% sequentially to $122 million. Volume increased 2.6% quarter-on-quarter to 4 million CBM, though net rates remained flat. Operating cash flow was $67 million, with $216 million in cash at quarter-end and $197 million in liquidity reserves via a revolving credit facility.
Fuel costs weighed heavily on results, with a $22 million negative impact, including $21 million in additional fuel expenses. The company held an average two months of fuel inventory on board. Middle East disruptions added roughly $10 million in costs, primarily from rerouting 16,000 vehicles bound for the region due to conflicts in Iran and the Strait of Hormuz. Vehicles were unloaded in the Caribbean, Mozambique, India, Sri Lanka, and Europe. These costs were passed on to customers.
Working capital expanded by $54 million during the quarter, driven by higher fuel inventories and receivables from Middle East cargo, though management expects normalization by the end of Q3. A $16 million dividend is scheduled for August, reflecting excess cash above target levels. The company’s net profit before tax fell 16% to $102 million, partially offset by a gain from a June refinancing.
Demand remained robust, with car exports from Asia up 31% year-on-year in the first half of 2026. Chinese exports surged 68%, while an estimated 1.5 million cars were shipped via container or alternative methods due to ro-ro capacity constraints. Höegh Autoliners is fully booked for 2026 and maintains a strong backlog into 2027.
The company operates eight Aurora Class vessels and has four dual-fuel ammonia vessels scheduled for delivery starting mid-2027. Refinancing efforts included a two-year extension of a $200 million revolver to 2030 and a four-year extension of its $640 million bank facility to 2034. Net debt to EBITDA stood at 1.3 times.
CEO Andreas Enger noted the quarter reflected exceptional customer demand, stating, “We could have filled more vessels if we had them.” He added that the operational dynamic has shifted back to earlier industry conditions and emphasized the company’s focus on building a competitive fleet.
