Pacific Basin Shipping Limited provided earning guidance for the year ended 31 December 2021. The board of directors of the Company informed the Company's shareholders and potential investors that, in light of the significantly improved dry bulk market outlook and the consequential increase in ship values, the Company expects to recognize a one-off non-cash reversal of impairment provision on the Group's Handysize core fleet of approximately USD 152 million in the results of the Group for the year ended 31 December 2021. The original impairment of USD 198 million on Handysize core fleet was taken as of 30 June 2020 in light of prevailing market weakness and the uncertain pandemic-related market outlook at that time.

This impairment provision is now expected to be fully reversed, adjusted for depreciation and the sale of certain vessels. Owing to the strong upward trend in the dry bulk freight market in 2021 driven by the global economic recovery, robust demand for commodities and reducing fleet growth which has contributed to the strong earnings of the Group as previously disclosed, and together with the Expected Reversal, the Group is expected to record a net profit attributable to shareholders for the Year in the range of approximately USD 830 million to USD 850 million as compared to the net loss of USD 208 million recorded for the year ended 31 December 2020. The Expected Reversal will be a one-off non-cash income and will increase the carrying value of the vessels by the same amount on the balance sheet.

It will not impact the operating cash flows, EBITDA or available committed liquidity of the Group. However, it will increase the overall future depreciation charge of the Group's Handysize vessels by approximately USD 16 million per year.