Annual Report 2025
TORM PLC
4TH FLOOR, 120 CANNON STREET
LONDON, EC4N 6AS, UNITED KINGDOM
COMPANY: 09818726
Contents
Strategic Report
2025 Highlights
Letters from the CEO and Chair 5
Key Figures 6
ESG Figures 7
Business Model and Strategic Choices
The Oil Transportation Value Chain 8
The Reference Company 10
The Versatile TORM Fleet 11
Greener Future With Zero Emissions 12
Superior Operating Platform 13
Review and Outlook
Risk Management 14
Market Review 19
Financial Review 2025 21
Market Drivers and Outlook 29
Coverage 2026-2028 31
TORM Fleet Development 32
Sustainability Statement
Introduction to the Sustainability Statement 35
Environment 51
Social 76
Governance 91
Governance
Governance Introduction
Governance at TORM 107
Chair’s Introduction 108
Governance Structure
TORM’s Governance Structure 110
Board of Directors 111
Board and Committee Meeting Attendance 113
Board Activities 2025 114
Committee Reports
Audit Committee Report 115
Risk Committee Report 119
Nomination Committee Report 121
Remuneration Committee Report 124
Other
Investor Information 141
Engagement and Decision-Making 144
Directors’ Report 147
Statement of Directors’ Responsibilities 149
Safe Harbor Statement as to the Future 151
Financial Statements
Consolidated Financial Statements
Consolidated Income Statement 153
Consolidated Statement of Comprehensive Income 153
Consolidated Balance Sheet 154
Consolidated Statement of Changes in Equity 155
Consolidated Cash Flow Statement 157
Notes to the Consolidated Financial Statements 158
Parent Company Financial Statements
Management Review for TORM plc 200
Parent Company Income Statement 201
Parent Company Statement of Comprehensive Income 201
Parent Company Balance Sheet 202
Parent Company Statement of Changes in Equity 203
Parent Company Cash Flow Statement 204
Notes to Parent Company Financial Statements 205
Other
Independent Auditor’s Report 214
Independent Auditor's Limited Assurance Report on the
Sustainability Statement
219
TORM Fleet Overview 221
Glossary 223
Alternative Performance Measures 225
TORM ANNUAL REPORT 2025 2
TORM
Strategy
Sustainability
Statement
Corporate
Governance
Financial
Statements
9 33 106 152
21
At TORM, we are committed to enhancing long-term
shareholder value through our culture, clarity of
purpose, and strategic advantage. Our One TORM
platform unites all parts of the business and powers
our ambitions as we embrace our responsibility to
lead sustainability through innovation, optimization,
and fleet modernization.
10
62
TORM ANNUAL REPORT 2025 3
As of 31 December 2025
10 ~4,000
OFFICES EMPLOYEES
STRATEGIC REPORT > 2025 IN REVIEW > LETTERS FROM THE CEO AND CHAIR
TORM ANNUAL REPORT 2025 4
Simon
Mackenzie Smith
CHAIR OF THE BOARD
Jacob
Meldgaard
CEO / EXECUTIVE DIRECTOR
The bedrock of this organization
is the people, including those I
have been fortunate enough to
encounter in my short time here,
who embody the desire for
relentless improvement that will
take us to future success.
- Simon Mackenzie Smith
Letters from the CEO and Chair
2025 was a year of progress and resilience for TORM. We continued to deliver market-
leading results, modernized our fleet, and provided solid dividends to shareholders.
Delivering Amid Geopolitical Tensions
2025 saw continued geopolitical tensions and evolving trade
patterns. On key routes impacted by the Red Sea disruption,
product flows gained momentum, supported by low diesel
inventories and European refinery closures. A reduction in
crude carrier cannibalization also strengthened demand for
dedicated clean product tankers. Regional dynamics were
further influenced by Ukrainian drone attacks on Russian
refineries. Despite numerous new-building deliveries, overall
clean trading capacity ended slightly below last year,
reinforcing a balanced market. As CEO and Executive Director,
I am proud that TORM navigated this complex environment and
delivered strong operational and financial performance with
market-leading freight rates.
Fleet Renewal and Financial Flexibility
I am pleased to share that we continued our disciplined fleet
optimization program in 2025. The vessel transactions carried
out last year reflect our commitment to maintaining a
competitive and fuel-efficient fleet in order to fully capture
market opportunities.
To support this strategy and strengthen our financial position,
TORM secured new financing commitments on very attractive
terms. This refinancing streamlines our capital structure by
replacing existing syndicated facilities and leases, supporting
long-term shareholder value creation.
Strong Financial Performance
TORM delivered satisfactory net profit of USD 286m in 2025,
supported by robust freight rate performance and disciplined
cost management. Across our fleet, Time Charter Equivalent
earnings were USD 28,783 per day, reflecting strong earnings
in each of our vessel classes. In line with our distribution
policy, we returned USD 2.12 per share in dividends to
shareholders, underscoring our commitment to return free
cash generated to our shareholders.
Advancing Sustainability
We remain committed to reducing our environmental footprint
and leading the industry’s decarbonization efforts. In 2025, we
achieved a 43% reduction in carbon intensity compared to
IMO’s 2008 baseline, thus demonstrating our ambition to
operate responsibly and create long-term value for all
stakeholders.
Looking Ahead
Just before year-end, TORM appointed Simon Mackenzie
Smith as Chair of the Board. Simon brings over 35 years of
corporate finance and investment banking experience,
including senior leadership roles at Bank of America Merrill
Lynch as well as recent experience as chair of a listed
company in the UK. His expertise in advising global energy and
asset-intensive companies will strengthen TORM’s strategic
direction. Join me in welcoming Simon to TORM.
The geopolitical landscape remains complex, and market
dynamics will continue to evolve. However, with our integrated
platform, eco-optimized fleet, and strong balance sheet, TORM
is well-positioned to deliver value in the years ahead.
Thank you for your continued trust and confidence in TORM.
Jacob Meldgaard, CEO / Executive Director
Unique Model to Navigate Uncertainty
In late 2025, I was invited to become Chair of TORM. I
accepted, assured that I was joining a specialist in the refined
oil and products market with a unique business model and an
enviable strategic focus. TORM successfully turned market
uncertainty into a distinct competitive advantage.
I have witnessed how the One TORM platform encourages
every part of the business to work together towards a common
goal, and brings commercial and technical management under
one structure. The platform is supported by advanced
analytics, proprietary digital technology, and continuous
refinement, while being a differentiator in a volatile market.
This holistic framework facilitates seamless coordination and
swift decision-making, allowing the business to identify and
capture attractive trading opportunities across regions. That
means TORM can deploy its fleet globally with consistently
high operational standards, regulatory protocols and financial
resilience securing strong returns, even in challenging
conditions.
The Path Ahead
TORM’s iconic shipping heritage is an important part of this
story both at home in its native Denmark, and globally as a
trusted partner. But the bedrock of this organization is the
people, including those I have been fortunate enough to
encounter in my short time here, who embody the desire for
relentless improvement that will take us to future success.
That is how TORM will navigate the path ahead to the benefit
of all our stakeholders.
Simon Mackenzie Smith, Chair of the Board
STRATEGIC REPORT > 2025 IN REVIEW > LETTERS FROM THE CEO AND CHAIR
TORM ANNUAL REPORT 2025 5
Key Figures
TCE Earnings (USD/Day) EBITDA (USDm) Adjusted ROIC (%) Dividend/Share (USD)
2025 2024 2023 2022 2021 2025 2024 2023 2022 2021
Income Statement (USDm) Key Financial Figures ¹⁾
Revenue 1,339 1,559 1,520 1,443 620 Gross margins:
Time charter equivalent earnings (TCE) ¹⁾ ⁵⁾ 910 1,135 1,084 982 379 Gross profit 49.7 % 57.4 % 57.5 % 54.2 % 30.4 %
Gross profit ¹⁾ 666 896 874 782 188 EBITDA 42.6 % 54.6 % 55.8 % 51.5 % 22.1 %
EBITDA ¹⁾ 571 851 848 743 137 Adjusted EBITDA 43.1 % 54.1 % 55.7 % 51.5 % 22.1 %
Adjusted EBITDA ¹⁾ 578 844 846 744 137 Operating profit (EBIT) 26.6 % 42.3 % 45.9 % 41.7 % 0.2 %
Operating profit (EBIT) 356 659 699 602 1 Return on Equity (ROE) 13.4 % 32.7 % 40.9 % 44.0 % -4.1 %
Financial items -61 -49 -47 -45 -42 Return on Invested Capital (ROIC) 11.5 % 24.3 % 30.4 % 29.2 % 0.01 %
Net profit/(loss) for the year 286 612 648 563 -42 Adjusted ROIC 10.8 % 22.2 % 27.6 % 28.1 % 0.2 %
Net profit/(loss) ex. non-recurrent items ¹⁾ 274 561 596 548 -36 Equity ratio 65.4 % 59.8 % 58.0 % 57.5 % 45.1 %
TCE per day (USD) ⁵⁾ 28,783 36,061 37,124 34,154 13,703
OPEX per day (USD) ⁵⁾ 7,638 7,477 7,069 6,825 6,633
Balance Sheet and Cash Flow (USDm)
Loan-to-value (LTV) ratio ⁵⁾ 29.4 % 26.8 % 27.6 % 24.8 % 51.2 %
Non-current assets 2,835 2,854 2,179 1,875 1,968
Total assets 3,367 3,470 2,870 2,614 2,331
Share-Related Key Figures ¹⁾
Equity 2,203 2,075 1,666 1,504 1,052 Basic earnings/(loss) per share (USD) 2.91 6.54 7.75 6.92 -0.54
Total liabilities 1,164 1,395 1,204 1,111 1,279 Diluted earnings/(loss) per share (USD) 2.85 6.36 7.48 6.80 -0.54
Invested capital ¹⁾ 3,038 3,005 2,426 2,142 2,011 Dividend per share (USD)
6)
2.12 5.10 5.78 4.63 —
Net interest-bearing debt ¹⁾ 848 948 773 650 972 Net Asset Value per share (NAV/share) ²⁾ 25.7 29.3 33.4 28.5 13.0
Net Asset Value (NAV) excl. NCI ²⁾ 2,603 2,854 2,858 2,330 1,047 Share price in DKK ³⁾ 126.9 138.4 204.2 198.4 51.7
Cash and cash equivalents, incl. restricted cash 164 291 296 324 172 Share price in USD ³⁾ 19.6 19.5 30.4 29.1 8.0
Investment in tangible fixed assets 321 911 608 121 371 Number of shares (m) ³⁾ ⁴⁾ 101.3 97.3 85.7 81.8 80.7
Free cash flow 346 385 434 513 -243 Number of shares, weighted average (m) ⁴⁾ 98.2 93.6 83.6 81.3 78.1
1) For a definition of the calculated key figures (the APMs), please refer to the glossary on pages 223 - 229. 4) Excluding treasury shares.
2) Based on broker valuations as of 31 December 2025, excluding charter commitments. 5) For Tanker segment.
3) End of period. 6) Dividend per share includes declared and proposed dividends.
STRATEGIC REPORT > 2025 IN REVIEW > KEY FIGURES
TORM ANNUAL REPORT 2025 6
28,783
36,061
37,124
34,154
13,703
2025 2024
2023 2022
2021
0
10,000
20,000
30,000
40,000
50,000
571
851
848
743
137
2025
2024 2023
2022 2021
0
200
400
600
800
1,000
10.8
22.2
27.6
28.1
0.2
2025
2024 2023
2022
2021
0
10
20
30
40
2.12
5.10
5.78
4.63
0.00
2025
2024
2023
2022
2021
0
2
4
6
8
ESG Figures
2030 Carbon Reduction (AER) 2050 Carbon Reduction Target 2030 Safety Target Gender Diversity in Leadership
2050
target
2030
target 2025 2024
Environmental
Carbon reduction (AER)
100 % 45 % 43 % 40 %
Absolute Scope 1 GHG emissions (tCO
2
e)
Net-zero ≤1,500,000 1,594,057 1,594,793
Absolute Scope 2 GHG emissions (tCO
2
e)
Net-zero ≤600 793 832
Absolute Scope 3 GHG emissions (tCO
2
e)
Net-zero ≤1,200,000 1,047,324 1,849,266
SO
x
emissions reduction
Net-zero 8 % 24 % N/A
1)
NO
x
emissions reduction
Net-zero 8 % 0.3 % N/A
1)
PM10 emissions reduction
Net-zero 8 % (1.3) % N/A
1)
PM2.5 emissions reduction
Net-zero 8 % (1.3) % N/A
1)
Oil spills (ITOPF definition)
0 0 0 0
1) As 2024 is the baseline year, reporting on the reduction in 2024 is not applicable.
→ Read more about our ESG targets in the Sustainability Statement
2050
target
2030
target 2025 2024
Social
Port State Control (PSC) deficiencies per
inspection (ratio)
TBD ≤0.75 0.84 0.65
Employee engagement participation rate
TBD ≥90 % 95 % 93 %
Employee engagement score
1)
TBD ≥82 82 87
Lost Time Accident Frequency (LTAF)
(per million exposure hours)
TBD ≤0.3 0.35 0.42
Underrepresented gender in Board of Directors
TBD 40 % 17 % 20 %
Working conditions in dry docks used by TORM TBD 2 main dry
docks used
2 main dry
docks used
N/A
Underrepresented gender in leadership positions
TBD 35 % 20 % 19 %
Governance
Identified anti-corruption and bribery cases
reported to MACN
TBD 100 % 100 % N/A
ESG screening of tier 1 and 2 suppliers
2)
TBD 100 % N/A N/A
1) In 2025, the target had to be multiplied by 10, because we changed the engagement survey system used. For better
comparability, the 2024 number is reinstated as per the new scale.
2) The ESG screening framework is not yet fully implemented, therefore no measurements can be made yet.
STRATEGIC REPORT > 2025 IN REVIEW > ESG FIGURES
TORM ANNUAL REPORT 2025 7
45.0%
43%
40%
39.5%
2030
target
2025
2024
2023
—%
10%
20%
30%
40%
50%
0.30
0.35
0.42
0.32
2030
target
2025
2024
2023
0.00
0.10
0.20
0.30
0.40
0.50
35%
20%
19%
20%
2030
target
2025
2024
2023
—%
10%
20%
30%
40%
50%
The Oil Transportation Value Chain
TORM plays an important role in the global value chain of transforming oil resources into
energy for consumers worldwide.
The global oil value chain begins with exploration and
production, followed by the movement of crude oil to refineries
via tankers, pipelines, rail, and/or road. Once refined, these
products enter distribution networks that deliver energy to
consumers worldwide.
TORM operates primarily in the segment that transports clean
petroleum products such as gasoline, diesel, jet fuel, and
naphtha, from refineries to onshore terminals and distributors.
These products power road transport, aviation, and
petrochemical production. We also carry non-fossil liquids,
including vegetable oils, ethanol, palm oil, and biofuels,
supporting the transition towards greener energy solutions.
Some TORM vessels handle dirty petroleum products, such as
residual fuels or crude oil, requiring extensive tank cleaning
before switching back to clean cargoes. This flexibility enables
us to adapt quickly to shifting trade flows.
Transportation patterns are constantly evolving. Refinery
closures in importing regions, for example, reduce crude
movements but increase demand for refined product
transport. Looking ahead, structural changes in global energy
markets, such as the pace of decarbonization and regional
supply shifts, will reshape the value chain.
TORM is positioned to lead in this dynamic environment. Our
integrated One TORM platform, supported by advanced
analytics, enables us to anticipate market shifts, optimize fleet
deployment, and capture opportunities across both fossil and
non-fossil cargoes. As energy demand scenarios extend well
into the coming decades, agility and innovation will remain
central to our strategy.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > THE VALUE CHAIN IN OIL TRANSPORTATION
TORM ANNUAL REPORT 2025 8
The Oil Transportation Value Chain
Strategic Framework
OUR
VISION
OUR STRATEGIC
CHOICES
OUR WAY OF
WORKING
The Reference Company in the
Shipping Industry
At TORM, we strive to be the
reference company in the shipping
industry. We aim to achieve this by
utilizing our integrated business
model to serve our customers with
attention to safety, reliability, and
commitment to the environment.
Leading Product Tanker Owner
Focused on Energy Efficiency
TORM’s strategy is to sustain
industry leadership through strong
financial flexibility, fully integrated
operations, and a high-quality fleet.
We prioritize long-term value
creation, as well as ongoing energy
optimization to support our net
zero CO₂ emission target for 2050.
Superior Operating Model for
Performance
TORM operates on a fully
integrated platform that unites
commercial leadership and high
quality technical management
while putting safety first. A strong
digital foundation enhances
transparency, vessel positioning,
and performance.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > STRATEGIC FRAMEWORK
TORM ANNUAL REPORT 2025 9
The Reference Company in the
Shipping Industry
Leveraging Strategic Optionality
Operating in a constantly changing world requires flexibility. At
TORM, we have embedded optionality into our strategy, which
enables us to act swiftly when attractive opportunities arise.
This approach allows us to diversify and adapt, for instance by
entering new trades, such as methanol cargoes with our MR
vessels, or by optimizing fleet deployment across the most
profitable basins.
Optionality also extends to fleet management. Our high
operational standards allow us to retain vessels regardless of
age until market conditions favor trading rather than
divestment. This ensures strong tradability and access to a
broader customer base. This flexibility is a key competitive
advantage, supported by our integrated One TORM platform.
Advantages of the One TORM Platform
The One TORM platform is the foundation of our success. By
integrating commercial and technical management, we deliver
superior performance and create long-term value for
customers and shareholders. Our proprietary positioning
model consistently outperforms the market, ensuring vessels
are deployed where earnings potential is highest.
Beyond commercial performance, the platform drives
innovation in energy efficiency and sustainability. We are
committed to achieving ambitious CO₂ reduction targets
through technological upgrades, operational optimization, and
continuous fleet renewal with eco-efficient vessels.
Guided by Our Core Values
In 2025, we continued to anchor our core values across our
entire organization, following the introduction of the values in
2024 as an updated and cohesive cultural foundation. These
values guide our strategic decisions and way of working.
Our three core values are:
• Committed to People
• Pursuing Innovation
• Always Delivering
Developed in a cross-organizational process involving input
from all levels of employees and reflection from the Senior
Management Team and the Board of Directors, these values
are a representation of how we collaborate and conduct
business at TORM. The core values are designed to resonate
clearly with our people and connect directly to daily work in
different functions and locations.
Active Management of Market Exposure
We actively manage our market exposure to optimize earnings
across cycles. While we primarily operate in the spot market,
we selectively use coverage options when rates are attractive:
• Time Charter (TC) contracts – Chartering a specific vessel
to a customer for 12–36 months, providing longer-term
stability and pricing advantages.
• Contracts of Affreightment (CoA) – Agreements covering
multiple consecutive cargoes over approximately 12
months, securing predictable volumes at agreed rates.
• Forward Freight Agreements (FFA) – Financial instruments
to hedge forward freight prices for up to 12 months,
offering flexibility to adjust length and volume or exit early.
By combining these instruments with dynamic fleet
positioning, we aim to maintain flexibility, adapt to changing
market conditions, and secure competitive advantage in a
volatile environment.
Fleet Growth Through Financial Engineering
TORM has pioneered share-based vessel transactions as a
strategic tool to expand and renew our fleet while
safeguarding a strong capital structure. This model has
enabled us to add modern, fuel-efficient tonnage, strengthen
share liquidity, and maintain financial resilience. By creating a
standardized framework that combines financial innovation
with operational excellence, we have unlocked new growth
opportunities and enhanced our ability to scale efficiently in a
dynamic market.
Creating Shareholder Value
Our focus extends beyond short-term distributions. While we
have historically returned excess liquidity to shareholders, our
long-term priority is to create sustainable value through
disciplined capital allocation and strategic fleet investments,
along with our operational leadership. Along with our strategic
fleet optionality, this approach supports high returns on Net
Asset Value (NAV). By balancing financial strength and
environmental responsibility, we aim to deliver superior returns
over time, not just through dividends, but by building a
stronger, more resilient company for the future.
→ Read more on the operational leverage of TORM’s spot
market exposure in the Financial Outlook on page 28
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > THE REFERENCE COMPANY IN THE TRANSPORTATION INDUSTRY
TORM ANNUAL REPORT 2025 10
The Versatile TORM Fleet
Operating across all major vessel classes in the product tanker market, we continue to
prioritize flexibility to make our fleet competitive and attractive in a dynamic market.
At TORM, we continuously enhance the trading flexibility of our
fleet by increasing cargo optionality. In recent years, we have
strengthened our chemical capabilities and are actively
exploring opportunities to diversify further.
Our MR fleet is built to transport all standard petroleum
products, and a portion of the vessels are additionally
equipped to carry chemical cargoes. Several units are fully
methanol-capable, while others are fitted to handle a broad
range of chemical grades. Additional upgrades are under
review to further increase compatibility, ensuring we remain
agile and ready to meet evolving customer demands.
This strategic focus on cargo flexibility enables TORM to
leverage emerging trade flows, diversify revenue streams, and
secure long-term competitiveness in a dynamic market.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > VESSEL FLEXIBILITY
TORM ANNUAL REPORT 2025 11
LR2 vessels provide flexibility to enter Afra/crude markets
when attractive opportunities arise. With a strong LR2
presence, TORM can seamlessly switch between product and
crude trades without losing scale in either market.
LR1 vessels offer cross-segment adaptability, shifting
between LR2 and MR trades. For example, LR1s can handle
MR cargoes from the US Gulf or LR2 routes such as Arabian
Gulf to Japan, maximizing utilization across basins.
MR vessels are highly versatile, capable of carrying a wide
range of clean petroleum products and select non-fossil
liquids. This flexibility ensures strong utilization and positions
TORM to capture opportunities across diverse trade lanes.
Greener Future With Zero Emissions
We leverage TORM’s market leadership to drive the product tanker industry towards a
more sustainable future and pursue solutions that benefit generations to come.
At TORM, sustainability is a strategic imperative that
underpins our long-term success. By aligning environmental
stewardship with operational excellence, we aim to create
lasting value for our stakeholders while contributing to a
cleaner, more resilient global economy.
An Environmentally Responsible Future
TORM is committed to combating global climate change and
minimizing pollution to the seas and air. A key focus for us is
to reduce CO₂ emissions through a structured approach and
continuously optimize energy efficiency across the short,
medium, and long terms.
While oil and refined products remain essential to global
societies, decarbonization and broader ESG agendas will
shape the future of the product tanker industry. TORM aims to
transport products as efficiently and responsibly as possible.
2030 and 2050 Targets
In 2024, one year ahead of schedule, we achieved our 2025
CO₂ intensity reduction target of 40% compared to the IMO’s
2008 baseline. This milestone is six years ahead of the IMO’s
industry-wide goal of 40% reduction in 2030, which
underscores our leadership in decarbonization.
Further progress was made in 2025, reinforcing our
commitment to continuous improvement and positioning
TORM firmly on track toward our next target: 45% CO₂
intensity reduction by 2030. Our long-term ambition remains
net-zero emissions from operating our fleet by 2050. These
goals are supported by clear performance measures
embedded across TORM’s management and organization.
Energy Transition Roadmap
To deliver on our 2030 and 2050 ambitions, TORM has
developed an integrated energy transition plan. This plan is
embedded in our annual cycle and budget process, ensuring
Senior Management and the Board of Directors maintain focus
on progress and pace.
The roadmap to 2030 relies on concrete initiatives and proven
technologies, and we push even further by pursuing innovation
and testing new solutions. Beyond 2030, achieving net-zero
emissions from operating our fleet by 2050 will depend on
industry-wide advancements, including the adoption of zero-
emission vessels and supporting fuel infrastructure.
→ Read more on TORM’s ESG target on page 7
→ Read more on TORM’s Energy Transition Plan on page 61
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > GREENER FUTURE WITH ZERO EMISSIONS
TORM ANNUAL REPORT 2025 12
Superior Operating Platform
We achieve market-leading performance and synergies across vessel classes by
managing our fleet on the fully integrated One TORM operating platform.
Operating our entire fleet as one, we unlock synergies across
vessel classes and ensure optimal tradability. At the core of
One TORM is integrated commercial and technical
management, which brings people, vessels, and systems
together to maximize efficiency and performance.
A Unified Approach for Better Results
On the One TORM platform, commercial, technical, sale and
purchase, and support functions collaborate toward common
goals in a network-based organization. This structure enables
fast, informed decision-making and creates alignment across
all stakeholders. The integration is powered by a sophisticated
data platform that prioritizes collaboration, transparency, and
data quality.
Creating Value for Customers
The One TORM model offers customers a unique proposition:
accountability, safety, and insight into vessel performance.
Through fleet-wide monitoring and real-time information
sharing, we identify and address inefficiencies almost
instantly. This allows us to reduce resource use, lower costs,
and minimize environmental impact. If a vessel does not
operate optimally, we know immediately and act decisively.
Safety and Sustainability at the Core
Safety remains a strategic priority. Our One TORM Safety
Culture program strengthens safety beyond compliance,
reflecting our belief that profitability and safety go hand in
hand. This program is embedded across the organization and
we ensure further development in order to meet rising
standards.
Looking Ahead
One TORM is a dynamic platform that will continue to evolve.
By leveraging advanced data analytics, digital tools, and
collaborative processes, we aim to further optimize
performance, enhance customer value, and deliver attractive
returns for our shareholders.
Our ambition is clear. We seek to keep improving operational
excellence and sustainability in global shipping. At the same
time, TORM aspires to be the reference company in the
product tanker industry, setting the benchmark for quality,
reliability, and responsible operations.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > SUPERIOR OPERATING PLATFORM
TORM ANNUAL REPORT 2025 13
Purchasing Second-Hand Vessels
Our approach to acquiring second-hand vessels demonstrates
the efficiency of the One TORM platform. Fleet renewal and
expansion remain core priorities, and each newly acquired
vessel is integrated through a structured, cross-functional
process designed to quickly bring it up to TORM’s high
operational standards.
Before purchase, potential vessels undergo a thorough
screening process followed by detailed inspections to assess
technical condition, quality, and compliance. Commercial,
technical, and financial teams work closely together to ensure
that every acquisition supports our long-term strategic
ambitions and meets the expectations of our customers and
stakeholders.
Once a vessel joins our fleet, we implement a comprehensive
upgrade program to align it with TORM’s standards. This
includes installing energy-efficiency equipment, improving
cosmetic appearance for safety and vetting, and applying
TORM’s operational processes. The program is coordinated
across departments to determine which upgrades are needed
and schedule them for optimal timing during drydocking.
This integrated approach ensures that every vessel meets our
performance, safety, and sustainability requirements, which in
turn reinforces the strength of the One TORM model.
Risk Management
TORM adapts to environmental changes, mitigates risks, and seizes opportunities.
Systematically managing risk is key to creating and protecting value.
Risk Management Framework
We acknowledge that TORM faces a range of risks in doing
business and that our success depends on identifying,
balancing, and deciding how to best manage and mitigate
risks. We believe that a strong risk management framework is
vital to protect TORM.
On an annual basis, TORM conducts an Enterprise Risk
Management (ERM) process, during which the critical risks
facing TORM are identified, assessed, and discussed by the
Management in TORM and subsequently approved by the
Board’s Risk Committee.
The objective for TORM and our shareholders is to be
adequately rewarded for any desired risk tolerance level, and
that the governance structure tailored to oversee the risk
management activities is in place, so that risks are mitigated
to the extent desired.
Governance
TORM’s risk management approach emphasizes the
accountability and oversight of management. The identified
risk responsibility is assigned to the Management team
member most suited to manage the risk. This person is
required to continually monitor the risk, implement and
maintain mitigating actions, evaluate, and report.
If the consequence of a risk exceeds the agreed risk tolerance,
TORM’s Management is required to assess if implementation
of additional mitigating controls is possible and necessary
until the desired risk level is achieved.
TORM’s risk management framework acknowledges that
unforeseen or “black swan events” occur in the maritime
industry. Therefore, TORM accepts this type of risk and will
have a plan or will diligently develop a plan in case such events
materialize. The ability to react to and navigate an
unpredictable future is managed in close collaboration
between the Management and the Risk Committee via agreed
predefined accepted risk tolerance levels, which are reported
on at regular meetings or, if needed, extraordinarily.
Risk Assessment Process
TORM’s risk identification process stipulates that the risk
department conducts risk interviews with Heads of
Departments and the Management on an annual basis to
identify principal and emerging risks. Identified risks are
prioritized, challenged, and approved by Senior Management
as risk owners. This also includes the assessment of
availability and effectiveness of mitigating actions taken to
avoid or reduce the impact or occurrence of the underlying
risks.
The risks are reassessed with the Risk Committee at a
minimum on a quarterly basis, and if specific events occur,
they may require a reassessment. The identified risks in TORM
are divided into top risks and watch list risks.
TORM’s Risk Tolerance and Main Risk Exposure
The Management and the Risk Committee discuss and decide
on TORM’s risk tolerance of principal and emerging risk
exposures. TORM’s risk tolerance and inherited exposure risks
are divided into five main categories and emerging risks:
• Industry and market risks
• Operational risks
• Compliance and IT risks
• Financial risks
• Emerging risks
TORM’s General Risk Tolerance Per Group of Risk
Categories
Industry and Market Risks
TORM accepts taking calculated risks, where the expected
return outweighs the evaluated risk exposure.
Operational, Compliance, and IT Risks
TORM is risk-averse or risk neutral and seeks to eliminate,
minimize, or reduce these risks through robust controls,
processes, and continuous improvement.
Financial Risks
TORM is risk adverse regarding financial risks. In essence,
TORM will seek to mitigate any such risks to a meaningful
minimum level.
TORM’s top risks measured on likelihood and consequence are
listed below and displayed on the heat map.
Emerging Risks and Climate Related Risks
TORM’s long term risks are viewed as directly related to
climate change.
→ Emerging risks and climate related risks are described in
our Sustainability Statement in the E1 section on page 51
Overall Risk Picture
TORM’s overall risk profile remains stable and well-controlled,
with market risk intentionally retained as source of value
creation and all other risks minimized to the extent possible.
This disciplined approach supports TORM’s long-term
resilience and ability to deliver sustainable value to
stakeholders.
The Risk Committee and Senior Management have carried out
a robust assessment, under the Corporate Governance Code,
of the principal and emerging risks which TORM faces,
including those that would threaten our business model, future
performance, solvency or liquidity, and reputation.
→ Each of the top risks are described on pages 16-17
Alignment with Risk Appetite
There is clear alignment between TORM’s risk appetite and the
net severity of all principal risks, with the exception of severe
vessel accidents, which due to their inherent nature cannot be
fully eliminated. These are managed through best-in-class
safety standards and comprehensive insurance coverage.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > RISK MANAGEMENT
TORM ANNUAL REPORT 2025 14
Development Compared to Last Year
Industry and Market Risks
TORM’s market risk exposure remains high, and we are
exposed to potentially adverse market conditions on freight,
bunkers, and vessel values. The residual risk level, post
mitigations, is considered manageable due to a strong capital
structure and our liquidity readiness while continually
assessing the market fundamentals and mitigating factors.
The risks are deemed to have increased slightly in likelihood
compared to last year due to general geopolitical uncertainty.
Operational Risks
Oil major approval risk is considered to be at a low level due to
continuous focus and efficient controls. Risk is slightly lower
due to effective implementation of SIRE 2.0.
In the event that TORM becomes involved in an environmental
disaster, this would severely damage our business and
reputation. It is considered highly unlikely that a vessel
accident with severe oil pollution would occur. In the unlikely
event, we would most likely be covered by insurance.
Events such as piracy and terrorism could result in kidnapping
or injury to seafarers or vessel damage. Attacks by Houthi
rebels on vessels in the Bab-el-Mandeb Strait, a narrow
passage connecting the Red Sea to the Arabian Sea, have
caused significant disruptions to shipping traffic. The Red Sea
is a crucial trade route for global commerce, connecting Asia
and Africa with Europe. TORM decided to temporarily put a halt
to transit via the strait of Bab-el-Mandeb in the Red Sea. We
deem that the risk of maritime safety threats is slightly
increased since last year due to the increase in piracy attacks
in the East Africa region.
Compliance and Cyber Risks
Due to the Russian invasion of Ukraine, sanctions have
increased. The likelihood of violating sanctions is deemed
minor and manageable due to TORM not trading Russian
customers along with mitigating activities, which involve
training of personnel as well as digital and automized sanction
screening systems.
Cyber security is the risk of system unavailability and data
loss due to cyberattacks. Risk impact is damages paid due to
loss of customer data and business interruption. Loss of
reputation can be a significant cause of financial loss of
businesses after a cyber incident. Impact is deemed minor due
to short IT recovery times and effective Business Continuity
Plans. Likelihood is considered slightly increased compared to
last year due to evolving threat landscape.
Financial Risks
TORM’s financial gearing, liquidity buffer, and break-even
levels have maintained the liquidity risk at an acceptable level.
Considering the high value generation and current mitigation
activities, the breach of covenants is considered unlikely.
→ Read more about mandates and sensitivity analysis of the
various risks in Note 24 on page 191
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > RISK MANAGEMENT
TORM ANNUAL REPORT 2025 15
Description of Top Risks
Industry and Market Risks
Operational Risks
Tanker
Freight Rates
Bunker Price Asset Management Oil Major Approval
Severe
Vessel Accident
Maritime
Safety Threats
Risk
Sustained low tanker
freight rates or inability to
predict and respond timely
and accurately to freight
rate developments.
Unexpected bunker price
increases not covered by
corresponding freight rate
increases.
Unexpected value
depreciation of vessels.
The most exposed vessels
are older vessels due to
new legislation driven by
the climate change agenda.
A sudden and unexpected
breach in quality
requirements of a single
vessel or continuous
decrease in quality across
the fleet.
A severe vessel accident
such as an environmental
disaster or material
damage or personal injury.
A maritime venture has
inherent hazards. Events
such as piracy and
terrorism are considered
main security risks.
Potential
Impact
TORM’s profitability would
be negatively impacted in
case of a distressed
product tanker market.
Vulnerability to a sustained
increase in the bunker
price and pass-through to
charterers may not have an
immediate effect, meaning
that TORM may temporarily
bear the full effect of price
increases.
A decline in TORM’s net
asset value, which could
lead to a requirement from
banks to provide additional
security. TORM would also
be exposed to cyclical
asset prices and assets
contracted at too high
prices.
The risk of a partial ban of
the TORM tanker fleet by
one or more oil majors.
TORM’s involvement in an
environmental disaster
would damage TORM’s
reputation and impair our
tradability with oil majors.
Events such as piracy and
terrorism could result in
kidnapping of or injury to
seafarers or vessel
damage.
Mitigating
Activities
TORM’s spot-oriented
strategy limits possible
mitigation. Unleveraging is
considered when terms and
pricing are deemed
attractive hereunder with
time charter-outs and FFA
coverage.
In general, TORM does not
hedge future bunker
expenses. In the case that
freight income is fixed,
TORM does hedge future
bunker exposures.
With a conservative capital
structure, focus on
conservative loan-to-value,
and a close view of the
market, TORM maintains
flexibility and an ability to
act in the asset market.
TORM’s integrated
platform with in-house
safety and technical and
operational staff secures
continued focus on quality
and high vetting standards.
Disaster recovery plans for
emergency situations are
in place as well as an
ongoing safety resilience
program to enhance safety
culture, including officers
being trained as safety
ambassadors.
TORM’s internal Trading
Restrictions Committee
has oversight of security
threats and decides how
best to avoid and mitigate
the risk. TORM follows all
industry best practices and
has procedures in place in
case of an incident.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > RISK MANAGEMENT
TORM ANNUAL REPORT 2025 16
A B C D E F
Description of Top Risks
Compliance and IT Security Risks
Financial Risks
Legal Compliance Cyber Security (Onshore) Cyber Security (Offshore) Liquidity Risk
Risk
Legal or policy non-compliance or ethical
misconduct. The risk consists of competition
law, corruption, fraud, and sanctions.
System unavailability and data loss
due to cyber attacks caused by
increasing interconnectivity and
severe external threat of cyber crime
are driving higher frequency and
severity of incidents.
Increasing digitalization of vessel
operations—such as navigation, engine
controls, satellite communication, and
onboard monitoring—heightens
exposure to cyber threats targeting
vessel systems. Global operations
further increase vulnerability due to
reliance on external connectivity and
varied port state cyber environments.
Liquidity risk is driven by financial gearing,
liquidity reserve, distribution policy,
maintenance requirements, fleet
employment strategy, and required vessel
investments.
Potential
Impact
TORM’s inability to comply with rules and
regulations could lead to penalties,
reputational damage, or the inability to
operate in key markets.
Business interruption and disruption
to trading resulting in loss of
business or theft of money.
A successful cyberattack could impact
on an individual vessel and may cause
operational disruptions, compromise
navigational accuracy, and compromise
essential controls. It may also lead to
financial loss, reputational damage, or
regulatory consequences.
Sustained low freight rates or another
unforeseen adverse development could
jeopardize liquidity, lead to covenant
breaches, and hence inflict costs and lack
of operational maneuverability.
Mitigating
Activities
Compliance and awareness training is
mandatory for all employees. In connection
with sanctions, a know-your-customer
screening system has been implemented.
Business continuity plans have been
implemented covering the entire
group. The plans include assessment
and contingency of critical systems
in case of business interruption.
Implementation of group-wide IT
Security Policy and IT Risk
Management Policy. The policy
ensures continuous focus on
capacity to detect and react to cyber
attacks.
TORM applies vessel level cybersecurity
measures including the segregation of
operational and IT networks, access
control, securing communication
channels, vulnerability detection and
assessment, and regular system
updates. The crew receives basic
cybersecurity training, and onboard
systems are monitored with assistance
from shore-based teams. Cyber
preparedness aligns with relevant
maritime cybersecurity guidelines.
Conservative financial leverage guided by
short and long-term cash flow forecasting
with stress-testing of critical assumptions.
Constantly maintaining sufficient cash
buffers and a tangible catalog of available
liquidity-enhancing initiatives in alignment
with our Distribution Policy.
STRATEGIC REPORT > BUSINESS MODEL AND STRATEGIC CHOICES > RISK MANAGEMENT
TORM ANNUAL REPORT 2025 17
G
H1 IH2
TORM ANNUAL REPORT 2025 18
Market Review
Geopolitical tensions remained a major driver of the product tanker market.
Geopolitical Turbulence
During 2025, the product tanker market remained strongly
affected by geopolitical factors. In addition to the Ukraine-
Russia war and the Red Sea disruption, the new administration
in the US implemented trade policies that resulted in
increased market volatility. Although most of these policies did
not have a direct effect on the product tanker market, or only
a temporary effect, this added extra uncertainty to the market.
Red Sea Disruption
Product flows on the main trade routes affected by the Red
Sea disruption (Middle East Gulf/India/Far East to Europe)
remained relatively subdued in the first half of the year,
neutralizing the positive ton-mile impact from vessel rerouting
towards Cape of Good Hope. After a strong recovery in
volumes in the third quarter, volumes on the route once again
declined with heavy refinery maintenance in the Middle East
in the fourth quarter. For the full-year 2025, flows affected by
the Red Sea disruption declined by 13% compared to one year
prior. While the majority of vessel owners continued to avoid
transiting the Red Sea, some cargo volumes returned to the
Red Sea during the year as the conflict between Israel and
Hamas eased. By year-end, volumes transitting the Red Sea
stabilized at around 40% of the pre-disruption levels,
compared to less than 10% observed in 2024.
Tighter Sanctions Against Russia
2025 saw a significant number of tankers added to sanctions
lists by the US, the EU, and the UK. In January 2025, the
outgoing Biden administration issued OFAC sanctions against
more than 140 tankers related to the Russian oil sector. This
had a profound impact on the productivity of the affected
fleet, with ton-miles “carried” by sanctioned vessels
immediately plunging by more than 60%.
Since the beginning of the year, the EU and UK continued to
tighten sanctions against Russia, sanctioning over 490
individual crude and product tankers involved in transporting
Russian oil and oil products. Also a ban on imports of oil
products derived from Russian crude was introduced, closing a
loophole which had allowed refineries in non-EU countries to
export diesel and jet fuel processed of Russian crude oil to the
EU. This ban took effect in January 2026.
In October 2025, direct sanctions on Russia were imposed for
the first time under the Trump administration in the US,
targeting Russian oil majors Rosneft and Lukoil and thereby
Russian revenues from oil exports.
Global Oil Demand and Refinery Landscape
While geopolitical issues and market disruptions continued to
be the main drivers of the product tanker market in 2025,
important developments in the market fundamentals occurred.
According to IEA’s estimates, global oil demand grew by 0.8m
b/d in 2025. Global refinery capacity at the same time
declined by 0.5m b/d, reversing the trend of refinery capacity
growth seen in the previous three years. During 2025, three
refineries in Northwest Europe with a combined capacity of
0.4m b/d (5% of the region’s refining capacity) were closed.
This added to the region’s middle distillate deficit. Similarly,
closure of 0.16m b/d Phillips66 Los Angeles refinery shaved
off 6% of the US West Coast refining capacity and increased
the region’s need for imported gasoline and jet fuel.
In addition, 0.27m b/d LyondellBasell refinery in Houston was
closed in early 2025. However, contrary to expectations, US
Gulf Coast product exports did not decline as higher crude
runs at remaining refineries in fact led to 3% year-on-year
increase in product exports.
STRATEGIC REPORT > REVIEW AND OUTLOOK > MARKET REVIEW
TORM ANNUAL REPORT 2025 19
LR2 Ras Tanura - Chiba
LR1 Ras Tanura - Chiba
MR Average
Jan Feb
Mar
Apr
May
Jun
Jul
Aug
Sep Oct
Nov
Dec
10,000
20,000
30,000
40,000
50,000
Via Suez Canal
Via Cape of Good Hope
2023
2024
2025
0
250
500
750
1000
1250
Middle East Gulf/India/Asia CPP Exports to Europe
SOURCE: KPLER
Tanker Freight Rates in 2025
SOURCE: CLARKSONS
K B/DAVERAGE TCE IN USD/DAY
On the other hand, intensified Ukrainian drone attacks on
Russian refineries in the second half of the year cut Russian
oil product exports by 7% year-on-year, although this was
offset by higher crude exports from the country.
East of Suez, product export volumes from the Middle East
increased compared to the previous year despite extensive
refinery maintenance at the end of the year. China’s product
exports remained unchanged, capped by export quotas.
Overall, clean petroleum product (CPP) ton-miles declined 4%
year-on-year in 2025 as the Red Sea effect partially subsided.
They remained nevertheless 5% above the pre-Red Sea
disruption levels in 2023.
Crude Tanker Cannibalization
Compared to 2024, crude tanker cannibalization of the CPP
trade returned to historically normal levels in 2025. VLCCs and
Suezmaxes accounted on average for 2% of the volume of
clean petroleum products loaded on crude tankers. Crude
cannibalization declined especially in the last quarter of 2025,
amid a strengthened crude tanker market.
Effective Fleet Growth
While the nominal product tanker fleet capacity increased by
5.3% in 2025, the product tanker fleet capacity actually
transporting clean petroleum products ended 2025 at the
same level as 2024. This reflects a net migration of around 50
LR2s into dirty trades during the year, driven by an increased
need for vessels in the Aframax trade as almost 40% of the
Aframax fleet falls under OFAC, EU, or UK sanctions. Multi-year
high crude tanker earnings towards the end of the year further
incentivized LR2 dirty-ups.
STRATEGIC REPORT > REVIEW AND OUTLOOK > MARKET REVIEW
TORM ANNUAL REPORT 2025 20
CPP
DPP
Jan Feb
Mar
Apr
May Jun
Jul
Aug
Sep Oct
Nov Dec
175
200
225
250
275
Product Tankers
Crude Tankers
Total CPP Ton-Miles
Jan-
24
Mar-
24
May-
24
Jul-
24
Sep-
24
Nov-
24
Jan-
25
Mar-
25
May-
25
Jul-
25
Sep-
25
Nov-
25
(10)
(5)
—
5
10
15
20
CPP Ton-Miles by Vessel Segment
SOURCE: KPLER
LR2 Fleet in CPP and DPP
SOURCE: TORM
NO. OF VESSELS
% VS. 2023 AVG.
Financial Review 2025
Financial review for the year ended 31 December 2025.
Highlights
Looking back, 2025 was a year in which geopolitics shaped the
rhythm of global trade. The introduction of US tariffs and
subsequent uncertainty around USTR-related port fees set the
tone early in the year. As months passed, Houthi attacks and
the unpredictability surrounding Suez Canal transits continued
to affect shipping routes and schedules. At the same time,
tightened sanctions on Russia, Iran, and Venezuela reshaped
energy flows, while a brief but intense conflict between Israel
and Iran, alongside stepped-up Ukrainian strikes on Russian
infrastructure and shadow tankers, added further tension to
an already complex landscape.
Against this challenging environment, we kept our focus at
TORM on operational excellence and agility. Our scalable
platform and disciplined commercial approach enabled us to
navigate market fluctuations and strengthen our standing as a
dependable, resilient leader in the product tanker industry.
In 2025, TORM achieved time charter equivalent (TCE)
earnings for the Tanker segment of USD 909.7m, placing the
result near the top end of the guidance range of USD 650–
950m provided in the Annual Report 2024. Group EBITDA
reached USD 570.8m, also well within the guided range of USD
350–650m. Despite elevated geopolitical tensions, freight
markets remained firm throughout the year, with fleet-wide
rates ranging from USD/day 26,672 in the second quarter of
the year to USD/day 31,012 in the third quarter of the year.
This strong performance enabled significant dividend
distributions to our shareholders and reflected our continued
commitment to long-term value creation.
Distribution
TORM’s Board of Directors has on the date of this report
approved an interim dividend for the fourth quarter 2025 of
USD 0.70 per share to be paid to shareholders corresponding
to an expected total dividend payment of USD 70.9m. The
distribution for the quarter is equivalent to 82% of net profit.
The payment date is 25 March 2026 to all shareholders on
record as of 12 March 2026, and the ex-dividend date is 11
March 2026 for the shares listed on Nasdaq OMX Copenhagen
and 12 March 2026 for the shares listed on Nasdaq New York.
The dividend payment will not be recognized as a liability and
there are no tax consequences.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 21
Key Developments for the Tanker Segment
USDm 2025 2024 Change
Income Statement
Revenue 1,314.2 1,544.0 -229.8
Port expenses, bunkers, and commissions -404.5 -409.2 4.7
Time charter equivalent (TCE) 909.7 1,134.8 -225.1
Operating expenses -253.1 -245.6 -7.5
Profit from sale of vessels 17.8 51.3 -33.5
Administrative expenses -106.5 -87.9 -18.6
Net profit/(loss) for the year 284.8 614.1 -329.3
Balance Sheet
Vessels, capitalized dry-docking and prepayments on vessels 2,820.9 2,843.9 -23.0
Total assets 3,347.9 3,456.0 -108.1
Borrowings, current and non-current 998.0 1,224.3 -226.3
Total liabilities 1,151.4 1,383.1 -231.7
Key Figures
TCE per day (USD) 28,783 36,061 -7,278
OPEX per day (USD) 7,638 7,477 161
Income Statement
TCE
In 2025, the average TCE rate/day for the Tanker segment
decreased 20.2% from USD 36,061 in 2024 to USD 28,783 in
2025. This decrease was primarily driven by lower revenue
following changes in market conditions.
As referred to above, the operating environment in 2025
continued to be shaped by geopolitical uncertainty, affecting
trading patterns and vessel availability. Ongoing Red Sea
disruptions, expanded sanctions on Russian exports, and
refinery closures in Europe and the United States supported
demand for transportation of refined oil products. The
decrease, compared to 2024, was impacted especially by
higher revenue in the first half of 2024, where product tanker
earnings benefited from elevated ton-mile demand as attacks
near the Bab al-Mandeb Strait led to widespread rerouting
around the Cape of Good Hope. From the second half of 2024
and into 2025, this effect was largely offset by crude tankers
cannibalizing LR2 trades of clean petroleum products,
substantially reducing revenue compared to the first half of
2024. During 2025, crude tanker cannibalization returned to
historically normal levels. The ton-mile effect also declined
year-on-year, although it remained above pre-Red Sea
disruption levels in 2023, partly offsetting the positive impact
from reduced crude tanker cannibalization.
Consequently, revenue for the Tanker segment for the year
2025 decreased by USD 229.8m to USD1,314.2m compared
to 2024, corresponding to a 14.9% decrease. The decrease in
revenue was partly offset by an increase in earning days of
553 days equivalent to 1.8% compared to 2024.
Port expenses, bunkers, and commissions for the Tanker
segment were USD 404.5m in 2025, a decrease of USD 4.7m
compared to USD 409.2m in 2024. The decrease can primarily
be attributed decreased bunker expenses of USD 34.6m partly
offset by increased port expenses of USD 12.7m, increased
losses on realized and unrealized derivative financial
instruments regarding freight and bunkers of USD 14.8m, and
increased expenses related to EU allowances and FuelEU
compliance of USD 5.5m.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 22
Change in Time Charter Equivalent Earnings in the Tanker Fleet
USDm MR LR1 LR2 Total
Time charter equivalent earnings 2024 689.2 130.1 315.5 1,134.8
Change in number of earning days -1.5 3.1 23.3 24.9
Change in freight rates -137.1 -31.6 -67.9 -236.6
Other 0.6 0.5 -14.5 -13.4
Time charter equivalent earnings 2025 551.2 102.1 256.4 909.7
Earnings Data
2025
USDm
2024
Full year Q1 Q2 Q3 Q4 Full year
% change
Full year
LR2 vessels
Available earning days ¹⁾ 6,859 1,856 1,866 1,781 1,872 7,375 8 %
Spot rates ²⁾ 45,752 29,408 33,351 35,996 38,109 34,340 -25 %
TCE per earning day ³⁾ 44,824 33,806 35,459 38,685 35,567 35,850 -20 %
LR1 vessels
Available earning days ¹⁾ 3,531 879 905 911 919 3,614 2 %
Spot rates ²⁾ 37,557 24,025 28,679 29,770 26,949 27,181 -28 %
TCE per earning day ³⁾ 36,998 24,947 27,371 29,508 31,075 28,262 -24 %
MR vessels
Available earning days ¹⁾ 20,897 5,326 5,117 5,167 5,241 20,851 — %
Spot rates ²⁾ 33,563 24,659 23,950 28,310 29,515 26,514 -21 %
TCE per earning day ³⁾ 33,026 24,675 23,345 28,632 28,832 26,374 -20 %
Total
Available earning days ¹⁾ 31,287 8,061 7,888 7,859 8,032 31,840 2 %
Spot rates ²⁾ 36,303 25,519 26,412 29,962 31,032 28,170 -22 %
TCE per earning day ³⁾ 36,061 26,807 26,672 31,012 30,658 28,783 -20 %
1) Total available earning days = Total calendar days less off-hire days.
2) Spot rates = Time Charter Equivalent Earnings for all charters with less than six months' duration.
3) TCE = Time Charter Equivalent Earnings. Please refer to the glossary on pages 223 to 229.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 23
Operation of Vessels
The development in operating expenses (OPEX) for the Tanker
segment is summarized in the table on this page. The table
also summarizes the operating days and the reconciliation to
available earning days for TORM’s fleet (including both owned
vessels and vessels financed via bareboat charters in sale-
and-leaseback arrangements).
OPEX for the Tanker segment increased by USD 7.5m to
USD253.1m in 2025 compared to USD245.6m in 2024. This
was due to 272 additional operating days compared to 2024
and increased operating expenses per day of 2.2% stemming
from general price increases combined with costs related to
recently acquired second-hand vessels partly offset by the
divestment of older tonnage.
The total TORM fleet had 1,287 off-hire and dry-docking days,
corresponding to 3.9% of operating days in 2025. This
compares to 1,568 off-hire and dry-docking days in 2024 or
4.8% of operating days. The lower relative share of operating
days in 2025 compared to 2024 is driven by 19 delivered
vessels in 2024 compared to six in 2025, several of which went
into drydocking immediately after takeover.
Administrative Expenses
In 2025, administrative expenses for the Tanker segment
increased by USD 18.6m to USD106.5m compared to 2024.
The primary factors were a donation to the TORM Foundation
of USD6.9m and increased wage expenses of USD5.4m
related to an increased workforce and general salary
regulations. The development is supported by additional
expenses of USD3.9m as a result of the introduction of a new
2025 retention program for certain employees and the CEO
and an acceleration of the vesting date for the previous 2023
retention program. For more information, refer to Note 5 - Staff
Costs.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 24
Change in Operating Expenses
USDm MR LR1 LR2 Total
Operating expenses 2024 163.1 26.9 55.6 245.6
Change in operating days 0.5 -0.2 1.8 2.1
Change in operating expenses per day 4.7 — 0.7 5.4
Operating expenses 2025 168.3 26.7 58.1 253.1
Change in Operating Days
Days MR LR1 LR2 Total
Operating days in 2024 21,914 3,677 7,264 32,855
Change in operating days 70 -27 229 272
Operating days in 2025 21,984 3,650 7,493 33,127
Off-hire, including dry-docking -1,133 -36 -118 -1,287
Available earning days 2025 20,851 3,614 7,375 31,840
Change in Operating Expenses Per Day
USD/day MR LR1 LR2 Total
Operating expenses per operating day in 2024 7,445 7,310 7,659 7,477
Operating expenses per operating day in 2025 7,655 7,314 7,746 7,638
Change in the operating expenses per operating day in % 3 % — % 1 % 2 %
Balance Sheet
Assets
TORM’s total assets for the Group decreased by USD 102.6m
to USD3,367.0m as of 31 December 2025, mainly driven by a
decrease of the total assets for the Tanker segment of USD
108.1m to USD3,347.9m. The reduction in the Tanker
segment was primarily driven by a lower balance of cash and
cash equivalents, including restricted cash of USD 129.3m,
mainly due to utilizing available liquidity in connection with a
major refinancing to reduce borrowings and concurrently
strengthen TORM’s financial flexibility through increased
revolving credit facilities.
As of 31 December 2025, the carrying amount of vessels and
capitalized drydocking in the Tanker segment amounted to
USD2,806.8m compared to USD 2,843.9m at end of 2024.
This decrease was due to the divestment including delivery to
new owners of seven older vessels of USD127.2m,
depreciation of USD209.1m, offset by the investment in and
delivery of six new second-hand vessels including capitalized
drydocking of USD299.2m. From the vessel divestments
during 2025, profit from sale of vessels was USD 33.5m lower
than 2024 due to fewer vessel transactions and generally
lower market value of vessels compared to 2024.
Based on the average broker valuations from two
internationally recognized shipbrokers, TORM’s fleet on water
had a market value of USD 3,177.5m as of 31 December 2025,
12.8% (2024: 26.0%) above the carrying value for the TORM
Group of USD 2,816.6m.
Assessment of Impairment of Assets
For impairment purposes for the Group, TORM’s Management
performed reviews of impairment indicators at every quarter-
end during 2025. Indicators of impairment for the Tanker Fleet
CGU include, but are not limited to, broker vessel values, time
charter rates, weighted average cost of capital, any other
adverse impacts from current economic, environmental, and
geopolitical uncertainty. The Audit Committee evaluated each
impairment indicator assessment and prepared a
recommendation to the Board of Directors on whether to
conduct an impairment test of the carrying value of the Tanker
Fleet CGU. During 2025, no recommendation to conduct an
impairment test was made. As mentioned earlier, at year-end
2025, vessel values from brokers were also well above the
carrying value of the vessels in the Tanker Fleet CGU,
supporting the conclusion by the Management to not perform
an impairment test.
For the Marine Engineering CGU, the year-end impairment test
did not identify any impairments. Please refer to Note 12 -
Impairment Testing for additional details of the impairment
assessments.
Equity
In 2025, total equity for the Group increased by USD127.8m
to USD2,202.6m. The increase was primarily driven by the net
profit for the year of USD 286.0m and share-based
compensation of USD 34.1m, offset by dividends paid of
USD199.7m.
Liabilities
TORM's total liabilities for the Group decreased by
USD230.4m to USD1,164.4m as of 31 December 2025,
mainly driven by a decrease of the total liabilities for the
Tanker segment of USD231.7m to USD1,151.4m. The
development is primarily due to a decrease in current and non-
current borrowings of USD226.3m to USD998.0m, of which
the majority relate to the refinancing of the two existing
syndicated loans as well as lease agreements covering 22
vessels.
Liquidity and Cash Flow
The TORM Group liquidity position by the end of 2025 was
USD 562.3m (2024: USD 614.8m) including restricted cash of
USD 5.4m (2024: USD 19.3m) and undrawn credit facilities of
USD 398.8m (2024: USD 323.6m).
As of 31 December 2025, the TORM Group had CAPEX
commitments of USD 141.5m primarily related to second-hand
vessel commitments, scrubber installations, and Flettner
rotors also known as rotor sails.
Net cash flow from operating activities was USD 498.9m
(2024: USD 826.8m). The decrease was primarily driven by a
decrease in TCE and higher working capital tied up compared
to 2024.
Net cash flow from investing activities was USD -152.6m
(2024: USD -442.1m). The development was primarily a result
of the delivery of six vessels during 2025, 13 fewer than in
2024, with an impact of USD 273.9m. Further, the development
was supported by increased proceeds from vessel sales in
2025 compared to 2024 of USD 13.2m.
Net cash flow from financing activities was USD -460.1m
(2024: USD -378.3m). The change in cash flow is mainly a
result of increased repayments of borrowings and reduced
proceeds from borrowings for a total of USD -392.8m, largely
in connection with the previously mentioned refinancing and
due to fewer investments in new second-hand vessels
compared to 2024. The development is primarily offset by
lower dividend payments of USD 353.6m.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 25
Cash Flow for the Group
USDm 2025 2024 Change
Net cash flow from operating activities 498.9 826.8 -327.9
Net cash flow from investing activities -152.6 -442.1 289.5
Net cash flow from financing activities -460.1 -378.3 -81.8
Net cash flow from operating, investing, and financing activities -113.8 6.4 -120.2
Primary Factors Affecting the Results of
Operations
TORM generates revenue by charging customers for the
transportation of refined oil products and crude oil, using
TORM’s tanker vessels. We focus on maintaining a high-quality
fleet and high tradability, and we actively manage the
deployment of the fleet between spot market, time charters,
and voyage charters that generally last from several days to
several weeks.
At TORM, we believe that the important measures for
analyzing trends in the results of our tanker operations
comprise the following elements.
Time Charter Equivalent (TCE) Earnings
Per Available Earning Day
TCE earnings per available earning day are defined as revenue
less voyage expenses divided by the number of available
earning days. Voyage expenses primarily consist of port and
bunker expenses, which are unique to a particular voyage, and
which would otherwise be paid by a charterer under a time
charter, as well as commissions, freight, and bunker
derivatives.
TORM believes that presenting revenue net of voyage
expenses neutralizes the variability created by unique costs
associated with particular voyages or the deployment of
vessels on the spot market and facilitates comparisons
between periods on a consistent basis. Under time charter
contracts, the charterer pays the voyage expenses, while the
shipowner pays these expenses under voyage charter
contracts. A charterer has the choice of entering a time
charter (which may be a one-trip time charter) or a voyage
charter. TORM is neutral as to the charterer’s choice because
TORM primarily bases its financial decisions on expected TCE
rates rather than expected revenue. The analysis of revenue is
therefore primarily based on developments in TCE earnings.
Spot Charter Rates
A spot market voyage charter is generally a contract to carry a
specific cargo from a load port to a discharge port for an
agreed freight rate per ton of cargo or a specified total
amount. Under spot market voyage charters, TORM pays
voyage expenses such as port, canal, and bunker costs.
Spot charter rates are volatile and may fluctuate on a
seasonal and a year-to-year basis. Fluctuations derive from
imbalances in the availability of cargo for shipment and the
number of vessels available at any given time to transport
these cargos. Vessels operating in the spot market generate
revenue which is less predictable but can potentially enable
TORM to capture increased profit margins during periods of
improvements in tanker freight rates.
Time Charter Rates
A time charter is generally a contract to charter a vessel for a
fixed period at a set daily or monthly rate. Under time charters,
the charterer pays voyage expenses such as port, canal, and
bunker costs. Vessels operating on time charters provide more
predictable cash flows but can yield lower profit margins than
vessels operating in the spot market during periods
characterized by favorable market conditions.
Available Earning Days
Available earning days are the total number of days in a period
when a vessel is ready and available to perform a voyage,
meaning that the vessel is not off-hire or in dry dock. For the
owned vessels, this is calculated by taking operating days and
subtracting off-hire days including days in dry dock. For the
chartered-in vessels, no such calculation is required because
charter hire is only paid on earning days and not for off-hire
days including days in dry dock.
Operating Days
Operating days are the total number of available days in a
period with respect to the owned and leased vessels, before
deducting unavailable days due to off-hire days including days
in dry dock. Operating days is a measurement which is only
applicable to owned vessels, not to the time chartered-in
vessels.
Operating Expenses Per Operating Day
Operating expenses per operating day are defined as crew
wages and related costs, the costs of spares and consumable
stores, expenses relating to repairs and maintenance
(excluding capitalized drydocking), the cost of insurance, and
other expenses on a per-operating-day basis. Operating
expenses are only paid for owned vessels.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 26
Going Concern
As of 31 December 2025, TORM’s available liquidity including
undrawn and committed facilities was USD 562.3m, including a
total cash position of USD 163.5m (including restricted cash of
USD 5.4m). TORM’s net interest-bearing debt was
USD848.4m, and the net loan-to-value ratio was 29.4%
(Tanker segment only). Further information on TORM’s
objectives and policies for managing our capital, our financial
risk management objectives, and our exposure to credit and
liquidity risk can be found in financial statement Note 24.
TORM monitors its funding position throughout the year to
ensure that it has access to sufficient funds to meet the
forecasted cash requirements and loan commitments, and to
monitor compliance with the financial covenants in its loan
facilities, details available in financial statement Note 2.
A key element for TORM’s financial performance in the going
concern period relates to the increased geopolitical risks and
trade disputes. TORM’s base case assumes that these
dynamics will persist. TORM monitors the general development
in the geopolitical situation and potential effects on the
product tanker market. In the base case, TORM has sufficient
liquidity and headroom for all the covenant limits.
→ The principal risks and uncertainties are on pages 14 - 17
In addition to the base case, TORM has developed a reverse
stress case. The reverse stress case covers the lowest TCE
rate that only just meets the minimum liquidity covenant and
the lowest vessel values that do not breach any of the
facilities’ minimum-security values in the period. In the reverse
stress case, with TCE rates significantly below the lowest
rolling four-quarter average observed since 2000 on each
vessel class basis accompanied by a corresponding decline in
vessel values, TORM maintains sufficient headroom on liquidity
and covenants throughout the going concern period.
The Board of Directors has considered TORM’s cash flow
forecasts and the expected compliance with TORM’s financial
covenants for the period until 31 March 2027. Based on this
review, the Board of Directors has a reasonable expectation
that taking reasonably possible changes in trading
performance and vessel valuations into account, TORM will be
able to continue in operation and comply with our financial
covenants for the period until 31 March 2027. Accordingly,
TORM continues to adopt the going concern basis in preparing
our financial statements.
Long-Term Viability Statement
In accordance with provision 31 of the UK Corporate
Governance Code, the Board of Directors confirms that they
have a reasonable expectation that TORM will continue in
operation and meet its liabilities as they fall due for the three-
year period ending 31 December 2028. This period has been
selected for the following reasons:
• The general volatility and uncertainty in the product tanker
market leads to a significant increase in the degree of
judgment and uncertainty beyond a three-year period.
• Three years are generally in line with the forecast horizon
for external equity analysts covering the shipping sector.
The assessment of the Board of Directors has been made with
reference to TORM’s current financial position and prospects.
The assessment of financial performance and cash flows is
primarily dependent on the expectations for:
• Demand-supply picture in the product tanker sector
including the expected vessel values and freight rates
achieved by TORM, which in addition also covers the
outlook related to the geopolitical situations and climate
change developments.
• Development of the fleet
• Operating and administrative expenses
• Capital expenditures covering vessel purchases and
maintenance of the existing fleet including installation of
scrubbers and fuel efficiency equipment.
• Changes in interest rates
The expected financial performance and cash flows are based
on the same underlying assumptions as used in TORM’s
general financial planning. The operating and administrative
cost levels are on similar levels as TORM’s historical
performance, and freight rates are assumed to remain at
strong and profitable levels, however, vessel values used in
forecasting comply with financial covenants and are based on
the latest market valuations from two independent, recognized
shipbrokers. The expected outlook has then been subject to a
reverse stress case over the three-year period, to assess the
long-term viability. The reverse stress case covers the lowest
TCE rate that only just meet the minimum liquidity covenant
and the lowest vessel values that do not breach any of the
facilities’ minimum security values in the period. In the reverse
stress case, with TCE rates slightly below the lowest rolling
four-quarter average since 2000 on a per vessel class basis
and a related decline in vessel values, TORM maintains
sufficient headroom on liquidity and covenants throughout the
viability period.
TORM’s freight rate assumptions as per the going concern
assessment continue throughout the viability period and have
further sensitized the vessel values downward over the period
to reflect a continued downturn. Should the product tanker
market (in terms of either freight rates or vessel values)
materialize significantly below TORM’s expectations for a
prolonged period, there is a risk of a covenant breach after the
going concern period, which would require mitigating actions,
including cost savings, sale of vessels, or increased leverage
which are considered within the Management’s control and
achievable. In such a scenario, the Management would also
consider obtaining appropriate waivers and although they
would be confident of obtaining them, these are not within the
Management’s control.
The Board of Directors monitors if TORM is moving towards a
covenant breach in order to incorporate any mitigating actions
in due course on an ongoing basis. Based on the sensitivity
analysis, the Board of Directors does not currently expect that
TORM will breach its financial covenants or experience a
liquidity shortfall over the three-year forecast period.
The Board of Directors has also considered the long-term
prospects of TORM beyond the three-year forecast viability
horizon. In doing so, the Board of Directors has taken the long-
term risks and opportunities for TORM discussed elsewhere in
the strategic report and the potential impact of economic
volatility, climate change agenda, new regulations,
technological disruption, current geopolitical situation, and
general changes in the utilization of energy sources into
consideration. Based on this assessment and taking the
current capital structure and TORM’s operational platform into
account, the Board of Directors believes that TORM is well
positioned both to respond to these risks and to take
advantage of any positive market developments for a period
beyond the three-year forecast horizon.
On behalf of TORM plc
Kim Balle, Chief Financial Officer
26 February 2026
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL REVIEW
TORM ANNUAL REPORT 2025 27
Financial Outlook 2026
Financial Outlook
At TORM, we develop annual guidance by tracking key
performance metrics, including TCE, coverage levels, and
EBITDA sensitivity to freight rate movements. Freight rates in
the product tanker market—our primary earnings driver—
remain highly volatile, while we expect operating costs per
vessel day and administrative expenses to stay broadly in line
with prior-year levels.
In 2025, our cash break-even TCE rate was approximately USD
15,000 per day excluding profits from vessel sales.
Our financial outlook is primarily based on the assumptions
described on the preceding pages. The most important factors
affecting our TCE earnings are expected to be:
• Geopolitical conflicts including the war between Russia
and Ukraine and the conflicts in the Middle East region
• Global economic growth or recession, consumption of
refined oil products, and inflationary pressure
• Location of closing and opening refineries and temporary
shutdowns due to maintenance
• Oil price development
• Oil trading activity and developments in ton-mile
• Bunker price developments
• Global fleet growth and newbuilding ordering activity
• Potential difficulties of major business partners
• One-off market-shaping events such as strikes, conflicts,
embargoes, political instability, weather conditions, etc.
We have limited visibility on TCE rates that are not yet fixed
with our customers. Hence, these rates may be significantly
lower or significantly higher than our current expectations.
For the full-year 2026, TCE earnings are expected to be in the
range of USD 850m – 1,250m (2025: USD 910m), and EBITDA
is expected to be in the range of USD 500m – 900m (2025:
USD 571m) based on the current fleet size.
As of 17 February 2026, 70% of the Q1 2026 earning days
were covered at USD/day 34,926. For the individual vessel
classes, the Q1 2026 coverage was 69% at USD/day 44,943
for LR2, 53% at USD/day 46,803 for LR1 and 74% at USD/
day 30,411 for MR.
Further, as of 17 February 2026, TORM had covered 23% of
the 2026 full-year earning days at USD/day 34,462. Hence,
77% of the 2026 full-year earning days are subject to change.
Thus as 26,241 earning days in 2026 are unfixed as of 17
February 2026, a change in freight rates of USD/day 1,000 will
– all other things being equal – impact the EBITDA by USD
26m.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FINANCIAL OUTLOOK 2025
TORM ANNUAL REPORT 2025 28
Disclaimer on Financial Outlook
The purpose of this Financial Outlook for 2026 is to comply
with reporting requirements for companies listed in Denmark.
Actual results may vary, and this information may not be
accurate or appropriate for other purposes. Information about
our financial outlook for 2026, including the various
assumptions underlying it, is forward-looking and should be
read in conjunction with the Safe Harbor Statements on page
151, and the related disclosure and information about various
economic, competitive, and regulatory assumptions, factors,
and risks that may cause our actual future financial and
operating results to differ materially from what we currently
expect.
The information included in this Financial Outlook for 2026 is
preliminary, unaudited and based on estimates and
information available to us at this time. TORM has not finalized
its financial statements for the periods presented. During the
course of the financial statement closing process, TORM may
identify items that would require us to make adjustments,
which may be material to the information provided in this
section. As mentioned above, the provided information
constitutes forward-looking statements and is subject to risks
and uncertainties, including possible material adjustments to
the financial outlook for 2026.
Market Drivers and Outlook
Geopolitics remain a key driver on the market, with additional impact likely to stem
indirectly from the crude tanker market.
Tonnage Demand
Trends in oil demand and changes in the refinery landscape
will drive ton-mile growth over the next few years. Geopolitical
drivers continue, however, to have a significant impact on the
market.
2026 started with additional EU sanctions against Russia,
making any easing of sanctions less likely. Some vessels have
begun to transit the Red Sea again, yet for now there has not
been a sustained period of de-escalation in the region,
prohibiting normalization of trade flows through the Red Sea.
The return will likely be only gradual and conditional. New
tensions between the US and countries such as Venezuela and
Iran are set to increase demand for compliant crude tankers,
which will indirectly have an impact on the product tanker
market as well.
As such, the market continues to be influenced by geopolitics,
while recent changes in trade flows towards longer distances
will at least partly remain. There is no certainty that these
geopolitical conditions will continue or if they might expand or
change in unanticipated ways.
Changes in the Refinery Landscape
After a wave of export-oriented refining capacity additions in
the Middle East over recent years, much of the refining
capacity being added in 2026 will occur in India. Although
refinery capacity growth in India will cater to growing domestic
demand, the additions of 660k b/d of capacity over
2026-2027 will leave room for growing export as well.
Refinery closures in Northwest Europe in 2025 that shaved off
5% of the region’s capacity will show their full impact on
Europe’s imports in 2026. Closure of an additional refinery
(0.15m b/d Benicia) on the US West Coast in Q2 2026 will
bring the closed capacity up to 12%, further increasing
demand for gasoline and jet imports to the region.
Crude Tanker Cannibalization
While crude cannibalization remains a downside risk factor for
the product tanker market, stronger crude tanker market
earnings are likely to lessen incentives for crude
cannibalization.
Tonnage Supply
In nominal terms, the product tanker fleet grew by 5% in 2025,
although LR2 migration to the dirty Aframax trades resulted in
no actual growth in the capacity transporting clean petroleum
products. Although scrapping activity increased compared to
previous years, it remains limited at below 1% of the fleet, as
sanctioned trades absorbed a large part of the older fleet.
Product tanker ordering activity slowed considerably in 2025
totalling 8.2m dwt, compared to 17.9m dwt and 22.9m dwt
ordered in 2023 and 2024, respectively. With the current order
book equivalent to 20% of the existing fleet (in terms of
capacity), newbuilding deliveries are set to accelerate in 2026
and 2027. However, this figure masks a large difference per
size class. While the order book in the LR2 vessel class
comprised 34% of the existing fleet, the figure was lower at
18% for LR1s and 15% for MRs.
The average age of the tanker fleet is currently the highest in
two decades with 17% of the current fleet capacity older than
20 years. As such, these vessels are natural candidates for
scrapping over the next five years.
48% of orders in the total order book for product tankers are
placed in the LR2 segment, which should be viewed in
combination with the uncoated Aframax segment. The order
book for Aframaxes stood at only 8%, resulting in a 19% order
book for the combined LR2/Aframax vessel classes. At the
same time, uncoated Aframaxes have a large recycling
potential with 30% of the fleet above 20 years of age. This
results in a combined LR2/Aframax fleet above 20 years of
21%, which is in fact above the combined order book.
STRATEGIC REPORT > REVIEW AND OUTLOOK > MARKET DRIVERS AND OUTLOOK
TORM ANNUAL REPORT 2025 29
This is amplified by the fact that at the start of 2026, 5% of
the product tanker fleet was subject to OFAC sanctions and
10% to combined OFAC/EU/UK sanctions. Looking at the
combined Aframax/LR2 segment, every fourth vessel is
subject to either OFAC, EU, or UK sanctions. With a large share
of the Aframax fleet overaged or sanctioned, this is likely to
continue to pull LR2s into dirty trades.
Given the already high order book and shipyards’ preference
for other vessel segments, TORM expects the product tanker
newbuilding ordering activity to remain relatively limited in the
next couple of years. This will translate into significantly lower
fleet growth from 2028 onward. Together with a higher share
of the fleet reaching natural scrapping age, this could lead to
negative net fleet growth towards the end of the decade.
Increasing but still manageable tonnage supply growth is
combined with the continuation of key positive demand side
drivers, although some of the drivers may turn less supportive.
Even though downside risks on the product tanker market
have increased, TORM believes that freight rate levels remain
strong in a historical context. However, market volatility is
expected to remain, not least due to the continued
unpredictable geopolitical instability.
STRATEGIC REPORT > REVIEW AND OUTLOOK > MARKET DRIVERS AND OUTLOOK
TORM ANNUAL REPORT 2025 30
Global Product Tanker Fleet and Order Book
Vessel classes
Fleet
31.12.2024
Delivered in
2025
Scrapped in
2025
Fleet
31.12.2025
Order book for
2026-2029
2026-2029 Order book
as % of end 2025 fleet
LR2 456 54 2 508 171 34 %
LR1 376 8 8 376 68 18 %
MR 1,925 96 14 2,017 302 15 %
Handysize¹⁾ 557 5 5 559 22 4 %
Total 3,314 163 29 3,460 563 16 %
1) Numbers for Handysize segment exclude stainless steel chemical vessels.
Coverage 2026-2028
Total earning days and covered days in TORM as of 17 February 2026.
The coverage tables below include both the physical fleet and FFA contracts.
Actual number of days can vary from projected number of days primarily due to vessel sales and
delays of vessel deliveries. Total earning days are defined as total calendar days less off-hire
days.
Coverage
2026 2027 2028
Total Earning Days
LR2 7,699 7,811 7,939
LR1 3,542 3,599 3,537
MR 22,633 22,569 22,659
Total 33,874 33,979 34,135
Covered Days
LR2 2,447 934 461
LR1 474 — —
MR 4,712 487 293
Total 7,633 1,421 754
2026 2027 2028
Covered, %
LR2 32 % 12 % 6 %
LR1 13 % — % — %
MR 21 % 2 % 1 %
Total 23 % 4 % 2 %
Coverage Rates, USD/day
LR2 41,017 33,929 31,185
LR1 46,803 — —
MR 29,816 22,218 22,218
Total 34,462 29,914 28,308
STRATEGIC REPORT > REVIEW AND OUTLOOK > COVERAGE 2026-2028
TORM ANNUAL REPORT 2025 31
TORM Fleet Development
Development in the fleet of owned and leased vessels.
The table below shows recent developments in TORM’s
operating fleet. In addition to 83 owned product tankers as of
end-year, we had ten vessels under sale-and-leaseback
agreements of which purchase options on eight vessels had
been called in 2025. We have options to buy back the
remaining two vessels.
At TORM, maintaining a modern, high-quality fleet is a core
priority. Through active fleet management, we regularly divest
older vessels to preserve an attractive average fleet age and
ensure operational efficiency and environmental performance.
Divestments are strategically timed and complemented by
selective acquisitions of premium second-hand vessels, which
are swiftly upgraded to meet TORM’s standards. This
disciplined approach safeguards long-term competitiveness
and enables us to consistently meet the evolving expectations
of customers, charterers, and other stakeholders.
Throughout 2025, we actively managed the TORM fleet as part
of our ongoing renewal and optimization strategy. In the first
quarter, we sold three 2005-built MR vessels, TORM Ragnhild,
TORM Resilience, and TORM Thames, all delivered to their new
owners during the period.
In the second quarter, we divested the 2008-built LR2 vessel
TORM Mathilde and agreed to sell two 2008-built MR vessels,
TORM Voyager and TORM Discoverer, with deliveries
completed in the third quarter. During the third quarter, we
also sold the 2007-built MR vessel TORM Adventurer and
acquired a 2010-built LR2 vessel, now renamed TORM Gauri.
In the fourth quarter, TORM agreed to acquire six 2014-2018
built MR vessels and two 2016-built LR2 vessels. Five of the
MR vessels were delivered before year-end and renamed
TORM Dover, TORM Delhi, TORM Dubai, TORM Davao, and
TORM Freedom, further strengthening our fleet profile. The
remaining vessels will be delivered in the first quarter of 2026.
Additionally, TORM divested the 2008-built LR2 vessel TORM
Maren, with delivery to the new owner in the first quarter of
2026.
As part of our capital and loan management strategy, TORM
exercised purchase options on 22 leaseback vessels of which
five LR2s and nine MRs were transitioned to full ownership
during the year.
These actions reflect TORM’s disciplined approach to fleet
management, ensuring flexibility, efficiency, and a competitive
fleet composition aligned with market opportunities.
STRATEGIC REPORT > REVIEW AND OUTLOOK > FLEET DEVELOPMENT
TORM ANNUAL REPORT 2025 32
Fleet Development
Q4 2024 Changes Q1 2025 Changes Q2 2025 Changes Q3 2025 Changes Q4 2025
Owned Vessels
LR2
15 — 15 -1 14 4 18 2 20
LR1
3 — 3 — 3 — 3 — 3
MR
52 -3 49 — 49 7 56 4 60
Total 70 -3 67 -1
66
11
77
6
83
Leaseback Vessels
LR2
6 — 6 — 6 -4 2 -1 1
LR1
7 — 7 — 7 — 7 — 7
MR
11 — 11 — 11 -9 2 — 2
Total 24 — 24 —
24
-13
11
-1
10
Total fleet 94 -3 91 -1
90
-2
88
5
93
TORM ANNUAL REPORT 2025 33
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GENERAL
TORM ANNUAL REPORT 2025 35
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ESRS 2 GENERAL DISCLOSURES
TORM ANNUAL REPORT 2025 36
ESRS 2
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TORM ANNUAL REPORT 2025 37
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TORM ANNUAL REPORT 2025 38
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TORM ANNUAL REPORT 2025 39
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TORM ANNUAL REPORT 2025 40
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TORM ANNUAL REPORT 2025 41
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TORM ANNUAL REPORT 2025 42
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TORM ANNUAL REPORT 2025 43
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TORM ANNUAL REPORT 2025 44
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TORM ANNUAL REPORT 2025 45
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TORM ANNUAL REPORT 2025 47
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TORM ANNUAL REPORT 2025 48
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > ESRS 2 GENERAL DISCLOSURES
TORM ANNUAL REPORT 2025 49
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > ESRS 2 GENERAL DISCLOSURES
TORM ANNUAL REPORT 2025 50
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 51
E1 Environment
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 52
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 53
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 54
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 55
Assumptions
Conclusion
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 56
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 57
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 58
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 59
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 60
Hot House World
Delayed Transition
Net Zero
Current Policies
2023
2025 2030
2035
2040 2045
2050
0
10,000
20,000
30,000
40,000
50,000
Hot House World
Delayed Transition
Net Zero
Current policies
2023
2025
2030 2035
2040
2045 2050
0
25
50
75
100
125
CO
2
Emission Pathways
SOURCE: IEA Energy Outlook 2025
Million tons of CO
2
per year
Oil Demand Forecast
SOURCE: IEA Energy Outlook 2025
Million barrels per day
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 61
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 62
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E1
TORM ANNUAL REPORT 2025 64
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > EU TAXONOMY REPORTING
TORM ANNUAL REPORT 2025 65
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > EU TAXONOMY REPORTING
TORM ANNUAL REPORT 2025 66
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > EU TAXONOMY REPORTING
TORM ANNUAL REPORT 2025 67
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E2
TORM ANNUAL REPORT 2025 68
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E2
TORM ANNUAL REPORT 2025 69
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E4
TORM ANNUAL REPORT 2025 70
E4 Environment
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > E4
TORM ANNUAL REPORT 2025 71
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 72
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 73
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 74
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > ENVIRONMENT > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 75
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 76
S1 Social
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 77
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 78
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 79
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 80
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 81
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 82
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 83
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 84
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 85
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S1
TORM ANNUAL REPORT 2025 86
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S2
TORM ANNUAL REPORT 2025 87
S2 Environment
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > S2
TORM ANNUAL REPORT 2025 88
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 89
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > SOCIAL > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 90
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > G1
TORM ANNUAL REPORT 2025 91
G1
Governance
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > G1
TORM ANNUAL REPORT 2025 92
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > G1
TORM ANNUAL REPORT 2025 93
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > G1
TORM ANNUAL REPORT 2025 94
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > ACCOUNTING POLICY
TORM ANNUAL REPORT 2025 95
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > TORM'S POLICIES
TORM ANNUAL REPORT 2025 96
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > TORM'S POLICIES
TORM ANNUAL REPORT 2025 97
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > TORM'S POLICIES
TORM ANNUAL REPORT 2025 98
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > TORM'S POLICIES
TORM ANNUAL REPORT 2025 99
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > TORM'S POLICIES
TORM ANNUAL REPORT 2025 100
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > INCORPORATION BY REFERENCE
TORM ANNUAL REPORT 2025 101
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > INCORPORATION BY REFERENCE
TORM ANNUAL REPORT 2025 102
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > INCORPORATION BY REFERENCE
TORM ANNUAL REPORT 2025 103
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > INCORPORATION BY REFERENCE
TORM ANNUAL REPORT 2025 104
STRATEGIC REPORT > SUSTAINABILITY STATEMENT > GOVERNANCE > INCORPORATION BY REFERENCE
TORM ANNUAL REPORT 2025 105
Governance
Governance Introduction
Governance at TORM 107
Chair’s Introduction 108
Governance Structure
TORM’s Governance Structure 110
Board of Directors 111
Board and Committee Meeting Attendance 113
Board Activities 2025 114
Committee Reports
Audit Committee Report 115
Risk Committee Report 119
Nomination Committee Report 121
Remuneration Committee Report 124
Other
Investor Information 141
Engagement and Decision-Making 144
Directors’ Report 147
Statement of Directors’ Responsibilities 149
Safe Harbor Statement as to the Future 151
TORM ANNUAL REPORT 2025 106
Governance at TORM
With respect to the year ended 31 December 2025, TORM plc was subject to the 2024
UK Corporate Governance Code (available at www.frc.org.uk).
This section of the Annual Report details our corporate
governance practices. Our governance framework is integral to
developing and executing our strategy. It ensures the Board
receives timely, detailed, and relevant information to
effectively oversee progress and challenge management.
Furthermore, this framework empowers our dedicated
Committees to conduct in-depth reviews of specific areas.
During 2025, TORM reviewed its compliance with the revised
UK Corporate Governance Code issued in January 2024. TORM
complied with 38 of the 41 provisions, with non-compliance on
Provisions 18, 19, and 32, reflecting considered business
decisions by the Board.
Provision 18: States that all directors should be subject to
annual re-election, however, TORM’s B-Director is not
appointed for a specified term and continues until removed by
the B-shareholder. On 06 January 2026, the threshold
required to maintain a B-shareholder was no longer met,
resulting in the termination of the B-shareholder structure and
the discontinuation of the B-Director role. As a result, all Board
members are now subject to annual re-election, bringing TORM
into alignment with the provision.
Provision 19: States that the Chairman of the Board of
Directors should not remain in place beyond nine years from
the date of their appointment to the Board of Directors. Simon
Mackenzie Smith was appointed Chair on 16 December 2025,
bringing TORM into alignment with the provision.
Provision 32: States that the Board of Directors must establish
a Remuneration Committee of Independent Non-Executive
Directors. In addition, the Chairman of the Board of Directors
can only be a member if he is independent on appointment,
and he cannot chair the Remuneration Committee. Full
compliance has been ensured following the appointment of
Simon Mackenzie Smith, whose independence has enabled the
committee structure to fully align with the requirements of the
provision.
Subsequent Events
As at the date of signing, TORM has conducted a review of its
compliance with the revised UK Corporate Governance Code
issued in January 2024. The Company complies with 39 of the
41 provisions. Non-compliance with Provisions 12 and 24
reflects deliberate and considered decisions by the Board,
taken in the context of TORM’s business model and
governance framework.
Provision 12: The Board has not appointed a Senior
Independent Director as it operates with a small, highly
engaged, and predominantly independent composition that
facilitates open, direct, and transparent communication among
directors.
Provision 24: The Company is not in full compliance with the
provision, which recommends that the Audit Committee
comprise at least three independent Non-Executive Directors.
TORM currently has two Independent Non-Executive Directors,
noting that one possesses the required recent and relevant
financial experience. Given the current size and composition of
the Board, appointing another director to the Audit Committee
would not meet the independence requirements of the Code.
The Board considers the present arrangements appropriate
and effective for TORM’s needs and will review the opportunity
to appoint an additional Independent Non-Executive Director
to the Board and subsequently to the Audit Committee at the
appropriate time.
→ TORM's updated compliance with the revised UK Corporate
Governance Code can be found at www.torm.com/investor/
governance/governance-documents-and-policies
TORM's Board of Directors has established five committees for
which formal Terms of Reference have been approved by the
Board of Directors and can be found on TORM’s website. The
Audit Committee is composed solely of Independent Non-
Executive Directors, meets four times a year at a minimum,
and is a permanent committee reporting to the Board of
Directors.
During the year, TORM completed a planned leadership
transition with the appointment of Simon Mackenzie Smith as
Chair of the Board of Directors. The Nomination Committee
oversaw a structured succession process, ensuring that the
incoming Chair possesses the skills, experience, and
leadership qualities required to support the Company’s long-
term strategic ambitions and maintain effective engagement
with shareholders.
The appointment of Simon Mackenzie Smith represents a
significant refresh of board leadership while preserving
continuity and an effective balance of independence,
expertise, and experience across the Board.
On 06 January 2026, David Weinstein resigned from the Board.
His resignation followed the Company’s reaching of the
threshold required to maintain a B-shareholder, resulting in the
termination of the B-shareholder structure and the
discontinuation of the B-Director role. As part of its ongoing
succession and composition review, the Nomination
Committee assessed the implications of this change and
concluded that the Board continues to maintain an
appropriate mix of skills, independence, and diversity following
the retirement of the B-Director position.
This section constitutes the UK statutory reporting on
corporate governance.
TORM’s Diversity and Inclusion Policy constitutes compliance
with the requirements stipulated by section 107d of the
Danish Financial Statements Act and the Danish
Recommendations on Corporate Governance.
→ Details on our Diversity and Inclusion Policy can be found in
our Sustainability Statement under S1 on page 76
GOVERNANCE > GOVERNANCE INTRODUCTION > GOVERNANCE AT TORM
TORM ANNUAL REPORT 2025 107
Chair’s Introduction
Chair’s Statement
On behalf of the Board of Directors, I am pleased to introduce
the corporate governance report for 2025. This continues to
be the Board’s principal method of reporting to shareholders in
relation to corporate governance.
“As Chair of the Board, I reaffirm our commitment to the
highest standards of corporate governance, integrity, and
accountability. The Board’s role is to safeguard the interests
of all stakeholders by ensuring that TORM operates
responsibly, transparently, and in full compliance with
applicable laws and regulations. In a year marked by
geopolitical uncertainty and evolving market dynamics, our
governance framework has provided stability and strategic
direction, enabling TORM to deliver sustainable performance
while advancing our environmental and social
responsibilities.”
Good corporate governance creates value for our stakeholders
as well as for the ongoing development and sustainability of
our business. Throughout the year, the Board of Directors met
in person and online, and was able to deliver on strategic
commitments. The Board of Directors met 14 times this year
with five ad hoc meetings in addition to the Board’s nine
scheduled meetings.
Board Evaluation
As with previous years, this year’s evaluation was undertaken
internally. It involved a review of the Board of Directors and its
principal committees, covering a wide range of topics. The
evaluation is a well-established process and an important
opportunity to test that the Board of Directors is well suited to
provide constructive inquiries to TORM’s Management. As a
result of this review, the Board of Directors expressed a desire
to deepen their understanding of artificial intelligence and its
potential implications for the company’s operations,
governance, and long-term strategic direction.
Changes to the Board
In 2025, following a comprehensive and thoughtful selection
process, I had the honor of being appointed Chair of TORM’s
Board of Directors. With a career rooted in corporate finance
and extensive experience advising international companies in
the energy sector and related asset-intensive industries, I am
privileged to bring this background to TORM at an exciting and
important time for the company.
I succeed Christopher Boehringer, who has served with great
dedication since becoming Chair in 2015. I am pleased that
Christopher will continue to contribute his insight and
leadership as a member of the Board, ensuring continuity and
strength in our governance as we move forward together.
Subsequent Event
With Oaktree and its affiliates reducing their ownership below
the one-third threshold in early 2026, the B-Director position
has been discontinued. As a result, David Weinstein, Deputy
Chair and Senior Independent Director, stepped down from the
Board on this date. The Board thanks Mr. Weinstein for his
significant contributions since 2015. Following his departure,
he will continue to support TORM as a Special Advisor to the
Board. In light of these changes and to ensure continued
oversight during the ongoing strategic review the Board has
initiated a temporary Transaction Committee to support and
coordinate matters related to potential corporate transactions.
GOVERNANCE > GOVERNANCE INTRODUCTION > CHAIRMAN'S INTRODUCTION
TORM ANNUAL REPORT 2025 108
Key Deliverables
Fleet
Throughout 2025, we actively managed the TORM fleet as part
of our ongoing renewal and optimization strategy..
Board Deep Dives Requested in 2025
Following this year’s evaluation, the Board of Directors
expressed a commitment to deepen its understanding of
artificial intelligence and its potential implications for TORM’s
operations, governance, and strategic direction. The Board
intends to explore how AI can be leveraged to enhance long-
term planning, ensuring the company remains resilient and
competitive in an increasingly digital and data-driven
environment.
Geopolitical Risk
In 2025, the Board continued to monitor geopolitical risks amid
persistent tensions and shifting trade patterns. Despite these
challenges, TORM successfully navigated a complex
environment, delivering strong operational and financial
performance. Disruptions in the Red Sea and evolving regional
dynamics influenced product flows, while market fundamentals
remained balanced despite new vessel deliveries. Against this
backdrop, TORM achieved market-leading freight rates,
reinforcing its position as a resilient and agile operator.
Employee Engagement Survey
This year, TORM office employees participated in the annual
engagement survey, which showed over a 95% response rate,
resulting in an engagement score of 82 out of 100. Further
details can be found within the S1 section.
As a consequence of these changes, there have been several
adjustments to committee memberships, which are detailed
separately within the individual committee reports.
Board Leadership
The Board of Directors remains steadfast in its oversight
responsibilities, ensuring that governance structures support
effective decision-making and risk management. In 2025, we
maintained rigorous compliance with regulatory requirements
and strengthened board engagement on strategic matters,
including capital allocation, fleet renewal, and operational
resilience. Our governance approach reflects a commitment to
independence, diversity, and accountability.
Shareholders
The Board remains committed to protecting shareholder
interests through accurate and timely financial reporting and a
transparent dividend policy. We engage proactively with
investors to ensure alignment with strategic objectives and
maintain balance between attractive returns and long-term
growth.
In continuation of the quarterly Distribution Policy first
introduced during 2022, TORM expects to pay out quarterly
dividends to our shareholders totaling USD 212.1m related to
2025.
Employees
Our governance framework places strong emphasis on our
employees, who are central to TORM’s success. The Board
oversees policies that promote a safe, inclusive, and respectful
workplace, ensuring compliance with international labor
standards and ethical practices. Diversity and inclusion remain
key priorities, supported by programs that foster equal
opportunities and professional development. We also maintain
rigorous health and safety standards across all operations,
reflecting our commitment to protect our people and uphold
the highest levels of integrity.
→ Read more about TORM’s people within the Sustainability
Statement on page 76
Customers
Governance extends to how we serve our customers. The
Board oversees initiatives that prioritize safety, reliability, and
sustainability in service delivery. By embedding compliance
and ethical standards into operational processes, we
strengthen trust and reinforce TORM’s reputation as a
responsible and dependable partner.
Suppliers
Responsible supply chain management is integral to our
governance framework. The Board oversees policies that
require suppliers to comply with TORM’s Code of Conduct,
covering human rights, environmental impact, and anti-
corruption standards. Regular audits and risk assessments are
conducted to ensure ethical practices and resilience across
our supplier network.
Community
The Board recognizes the importance of contributing
positively to the communities in which we operate. Governance
extends to ensuring that our social impact initiatives are
aligned with ethical standards and stakeholder expectations.
We support programs that promote education, environmental
awareness, and local economic development, while maintaining
transparency in charitable contributions and community
engagement. These efforts reflect our commitment to creating
shared value beyond our core business activities.
Supporting Quality Education
TORM is proud to advance the United Nations Sustainable
Development Goal 4 Quality Education by investing in
meaningful learning opportunities across the communities
where we operate. Through the TORM Philippines Education
Foundation, we provide scholarships, teacher training, and
essential learning tools, while our cadet program has enabled
hundreds of Filipino seafarers to build successful maritime
careers. In India, we work with NGOs to improve school
infrastructure and remove barriers to education, and in
Denmark, we partner with the Red Cross to empower young
refugees and migrants through language training and inclusion
programs. Globally, TORM also supports education through
internships, trainee programs, and collaborations with leading
academic institutions.
→ Read more about TORM’s connection to the surrounding
communities at www.torm.com/responsibility/social
Environment
Environmental governance is a priority for the Board. We
oversee the execution of TORM’s decarbonization roadmap,
which achieved the IMO 2030 CO₂ intensity reduction target
ahead of schedule. The Board ensures that environmental
considerations are embedded in investment decisions and
operational practices, reinforcing our long-term ambition to
achieve net-zero emissions from operating our fleet by 2050.
→ Read more about TORM’s people within the Sustainability
Statement on page 76
ESG Reporting
The Board is committed to transparent and comprehensive
ESG reporting. Our disclosures align with recognized
international standards and provide stakeholders with clear
insights into environmental, social, and governance
performance. ESG matters are integrated into Board
deliberations, ensuring that sustainability objectives are
pursued alongside financial and operational goals.
The Year Ahead
In 2026, the Board will continue to focus on strengthening
governance structures, and advancing our energy transition
strategy. We will maintain disciplined capital allocation and
ensure compliance with evolving regulatory requirements,
while supporting innovation and operational excellence.
→ Read more about TORM’s forward focus on page 12
On behalf of the Board, I thank our shareholders, employees,
customers, and partners for their continued trust. We remain
committed to strong governance and sustainable value
creation as we navigate the opportunities and challenges
ahead.
We look forward to connecting with you at our Annual General
Meeting in April 2026 and updating you at that time on our
progress. Thank you for your continued support.
Simon Mackenzie Smith
Chair of the Board
GOVERNANCE > GOVERNANCE INTRODUCTION > CHAIRMAN'S INTRODUCTION
TORM ANNUAL REPORT 2025 109
TORM’s Governance Structure
The Board of Directors
Chaired by Simon Mackenzie Smith
The Board of Directors holds nine prescheduled meetings on an annual basis in addition to several ad hoc meetings. The duties of the Board of Directors include establishing policies for strategy, accounting, organization,
finance, and the appointment of executive officers. The Board of Directors governs TORM in accordance with the limits prescribed by the Articles of Association or by any special resolution of the shareholders.
Chair
Leads the Board of Directors, sets the
agenda, and promotes a culture of open
debate between Executive and Non-
Executive Directors.
Meets regularly with the Chief Executive
Officer (CEO), other Executive Directors,
and other senior management
executives to stay informed.
Senior Independent Director
Ensures that the views of each Non-
Executive Director are given due
consideration.
Available to both Non-Executive
Directors and shareholders if they have
concerns.
Meets with each Non-Executive Director
on an annual basis to appraise the
performance of the Chair.
Non-Executive Directors
Committed to contributing
constructively to challenge and help
develop proposals on strategy.
Executive Director
Responsible for the day-to-day
management of TORM and for TORM’s
operational development, results, and
internal development.
Implements the strategies and overall
decisions approved by the Board of
Directors.
Board Observers
Employee-elected observers, providing a
communication platform between the
employees and the Board of Directors.
All observers are entitled to attend and
speak at Board meetings.
Audit Committee
Chaired by Göran Trapp.
Meets a minimum of four times a year.
Assists the Board of Directors in fulfilling
its responsibilities relating to the
oversight of the quality and integrity of
the accounting, auditing, internal
controls and financial and ESG reporting
of TORM.
Risk Committee
Chaired by Göran Trapp.
Meets a minimum of three times a year.
Responsible for supervisory oversight
and monitors responsibilities with
respect to risk management.
Nomination Committee
Chaired by Simon Mackenzie Smith.
Meets a minimum of twice a year.
Reviews the structure, size, and
composition (including skills, knowledge,
experience, and diversity) of the Board of
Directors and makes recommendations
to the Board regarding any changes.
Considers succession planning for
directors, the CEO, and others.
Remuneration Committee
Chaired by Annette Malm Justad
Meets a minimum of twice a year.
Assists the Board of Directors in
reviewing the Management’s
performance and remuneration as well as
TORM’s general remuneration policies.
Transaction Committee (Temporary)
Chaired by Simon Mackenzie Smith.
Meets a minimum of twice a year.
Operates under a mandate to enhance
corporate governance by reviewing and
assessing potential transactions that
may emerge from, or be prompted by,
the arrival of a new large shareholder
whose strategic intentions are not yet
known.
Senior Management Team
Consists of the following employees of TORM A/S (in addition to the Executive Director, Jacob Meldgaard): Kim Balle (Chief Financial Officer, CFO), Lars Christensen (Senior Vice President and Head of Projects), and Jesper S.
Jensen (Senior Vice President and Head of Technical Division). The Senior Management Team holds weekly meetings and assists the Executive Director in the day-to-day management of the business.
GOVERNANCE > GOVERNANCE STRUCTURE > TORM'S GOVERNANCE STRUCTURE
TORM ANNUAL REPORT 2025 110
Board of Directors
Simon Mackenzie Smith
Non-Executive Director and Chair of
TORM’s Board of Directors
Christopher H. Boehringer
Non-Executive Director and Ex-Chair of
TORM’s Board of Directors
Annette Malm Justad
Independent Non-Executive Director
Nationality: British Nationality: Canadian Nationality: Norwegian
Appointed: 2025 First elected: 2015. Resigned as Chair
2025
First elected: 2020
Employment: Corporate finance and
investment banking
Employment: Managing Director and Head
of Europe, Oaktree Capital Management
(International) Limited
Employment: Board member
Skills and Experience: Background in
corporate finance and extensive experience
advising international companies in the
energy sector and related asset-intensive
industries
Skills and Experience: Shipping, strategy,
capital investment, M&A. Goldman Sachs, FI
Travel Corporation, Warburg Dillon Read/SG
Warburg, and LTU GmbH & Co
Skills and Experience: Shipping, strategy,
customers, capital, finance. More than 25
years of executive experience from
shipping and other industries, in positios
including CEO of Oslo-listed Eitzen Maritime
Services ASA from 2006-2010. The last 15
years as independent consultant and Non-
Executive Board member
External Appointments: Chair of Dowlais
Group plc and non-executive director at
Interpath Limited.
External Appointments: Utmost Group,
Marco Capital Holdings Limited, Oaktree
Capital Management (International) Limited,
and Draslovka a.s.
External Appointments: Partner at Recore
Norway AS. Chair of the Board of Directors
of Store Norske Spitsbergen Kulkompani
AS, Småkraft AS. Board member of Awilco
LNG ASA and PowerCell Sweden AB and
Bakkegruppen AS
GOVERNANCE > GOVERNANCE STRUCTURE > BOARD OF DIRECTORS
TORM ANNUAL REPORT 2025 111
Göran Trapp
Independent Non-Executive Director
Jacob Meldgaard
Executive Director and
Chief Executive Officer
David N. Weinstein
Senior Independent Director and Deputy
Chair of TORM’s Board of Directors
Nationality: Swedish Nationality: Danish Nationality: American
First elected: 2015 First elected: 2015 Appointed: 2015, continued until removed
by the B-shareholder. Resigned 06 January
2026
Employment: Board member Employment: Chief Executive Officer of
TORM since 01 April 2010
Employment: Senior investment banking,
governance, and reorganization specialist
Skills and Experience: Shipping, strategy,
customers, capital, finance, business
development and oil trading at Statoil,
Morgan Stanley crude oil trader, Head of Oil
Products,Trading Europe & Asia, Global
Head of Oil Trading, and Head of
Commodities EMEA. Founding director of
energy advisory boutique Energex
Skills and Experience: Shipping, customers,
strategy, capital, M&A, US listing. Previously
served as Executive Vice President of
Dampskibsselskabet NORDEN A/S and held
a number of management positions in J.
Lauritzen A/S and A.P. Moller - Maersk
Skills and Experience: Strategy, capital
markets and finance, risk management and
oversight, extensive public company and
corporate governance experience, global
business, US Llstings (i.e. Seadrill Limited,
Stone Energy Corp, and Deep Ocean
Group), and as Managing Director of Calyon
Securities Inc, BNP Paribas, Bank of Boston,
and Chase Securities Inc.
External Appointments: Chair of Energex
Partners Ltd
External Appointments: Board member of
Danish Shipping, International Chamber of
Shipping, Danish Ship Finance,
SYFOGLOMAD Ltd, Copenhagen
International School, and the TORM
Foundation
External Appointments: N/A
GOVERNANCE > GOVERNANCE STRUCTURE > BOARD OF DIRECTORS
TORM ANNUAL REPORT 2025 112
Board and Committee Meeting Attendance
Board
Audit
Committee
Risk
Committee
Nomination
Committee
Remuneration
Committee
Transaction
Committee
Meetings Held in 2025 14 5 4 2 2 3
Chair of the Board
Christopher H. Boehringer
Resigned as Chair of the Board and all committees 16 December 2025.
12 2 2
Simon Mackenzie Smith
Appointed 16 December 2025.
Appointed Chair of Transaction and Nomination Committee 16 December 2025
Senior Independent Non-Executive Director
David N. Weinstein
Resigned from the Board and all committees 06 January 2026
14 5 4 2 2 3
Executive Director
Jacob Meldgaard
14 2 2
Non-Executive Independent Directors
Annette Malm Justad
Took over as Chair of Remuneration Committee on 16 December 2025
12 4 4 2 2 3
Göran Trapp
Appointed member of the Remuneration and Nomination Committee 06 January 2026
14 5 4 3
Christopher H. Boehringer
Reverted to member of the Board from 16 December 2025.
Board Observers
Rasmus J. Skaun Hoffmann 14
Liv Kjær 14
Board of Directors: Audit: Risk: Nomination: Remuneration: Transaction: Chair:
GOVERNANCE > GOVERNANCE STRUCTURE > BOARD AND COMMITTEE MEETING ATTENDANCE
TORM ANNUAL REPORT 2025 113
Board Activities 2025
Board Evaluation
As TORM is not listed in the UK, we are not required to have an
external evaluation. Instead, TORM undertook an internal
evaluation involving a detailed and thorough review of the
Board of Directors and its principal committees, covering a
wide range of topics. Following this year’s evaluation, the
Board requested to further increase their knowledge of
artificial intelligence and its potential impact on the company’s
operations, governance, and strategic decision-making.
Board Activities
The Board of Directors remains committed to generating long-
term sustainable success as its primary objective. TORM’s
governance framework is designed to support this ambition
and is continuously enhanced to reflect evolving best
practices. In 2025, the Board focused on several key strategic
areas critical to the company’s future. As risks and
opportunities continue to develop, the Board prioritizes
staying informed and ensuring its competencies remain
aligned with the company’s strategic direction.
Strategy Update
During the past year, the Board concentrated on
strengthening strategic resilience in an environment where
freight markets had settled into more typical patterns. Fleet
optimization remained a central theme. The Board also
endorsed a comprehensive refinancing package designed to
enhance capital flexibility and lower the company’s cost base.
In addition, regular dividend distributions were approved
throughout the year, underscoring the company’s continued
commitment to delivering strong returns to shareholders.
Geopolitical Updates
The Board continued oversight of geopolitical developments,
supported by analyses from TORM’s geopolitical advisor,
engaged since 2022. This included rigorous monitoring of Red
Sea disruptions and expansion of vessel-related sanctions to
ensure full compliance and continuity of operations. Scenario
planning was undertaken to evaluate potential reopening of
the Red Sea and prospective changes to global sanction
regimes, reinforcing the resilience of trade flows. Broader
macroeconomic trends, including tariff-related effects on
global growth and petrochemical demand, were reviewed
regularly to inform strategic decision-making.
Commercial Diversification and Strategic Fleet Financing
Global commercial performance was reviewed with a focus on
diversification across key regions to mitigate route-specific
volatility. Deployment strategies were adjusted to capitalize on
stronger earnings in LR2 and LR1 segments, while maintaining
flexibility amid shifting trade patterns. Financing initiatives
leveraged international banking relationships to secure
favorable terms for fleet growth and lease repurchases.
Operational Excellence and Safety
The Board reaffirmed its commitment to compliance, integrity,
and operational excellence. Safety and crew welfare remained
priorities, with enhanced measures implemented to address
longer routing and operational complexity. Performance
metrics were closely monitored to drive continuous
improvement across vessel classes.
Fleet Expansion and Optimization
Fleet expansion and optimization were central themes for the
Board in 2025. TORM completed the sale of older tonnage, and
approved acquisitions to strengthen the fleet. These actions
aligned with the Board’s strategy to maintain operational
efficiency, enhance earnings potential, and secure a
competitive position in the global product tanker market.
Our Responsibility
Capital allocation decisions balanced dividends, debt
reduction, and fleet investments, sustaining attractive return
on investments levels throughout the year. Transparent
shareholder communication was maintained across dual
listings, including timely updates on dividends and financial
guidance.
AI and Machine Learning
Management initiated AI-driven projects for freight rate
forecasting and voyage optimization, which were subsequently
discussed with the Board. Compliance analytics using AI were
introduced to improve sanctions screening and operational
risk management, and investor communication tools
leveraging generative AI were piloted to simplify reporting and
enhance engagement, all in coordination with the Board.
Cyber Security
In 2025, the Board prioritized strengthening TORM’s cyber
resilience to safeguard operations and data integrity. The
Board ensured compliance with global cybersecurity
standards and oversaw cyber security maturity assessments,
regular penetration testing, and employee awareness
programs to mitigate risks on shore as well as on board
vessels. Additionally, the Board participated in a planned
Business Continuity drill. These initiatives reflect TORM’s
commitment to operational security and resilience in an
increasingly digital maritime environment.
Shareholder Transactions
In December 2025, Hafnia Limited completed its acquisition of
approximately 14.2 million A-shares in TORM, representing
13.97% of the company’s issued share capital, following the
fulfillment of all conditions precedent under its share purchase
agreement with Oaktree Capital Management. This significant
change in ownership triggered the “threshold date” defined in
TORM’s Articles of Association, as Oaktree’s beneficial
ownership fell below one third of the share capital. As a result,
the authority of the B-Director expired, and the Board oversaw
associated governance transitions, including the departure of
the Deputy Chair and Senior Independent Director and the
commencement of share class redemptions in line with the
Articles. Throughout this period, the Board remained focused,
adhering to statutory and governance requirements, and
supporting an orderly transition following the conclusion of
Oaktree’s long-standing ownership position.
GOVERNANCE > GOVERNANCE STRUCTURE > BOARD ACTIVITIES 2025
TORM ANNUAL REPORT 2025 114
Audit Committee Report
Chair’s Statement
This report provides an overview of how the Audit Committee
operates, an insight into the Audit Committee’s activities, its
role in monitoring and reviewing the integrity and quality of
TORM’s financial statements, the effectiveness of internal
controls, and related processes.
Audit Committee Members
The Board of Directors is satisfied that the Audit Committee
meets the independence requirements under applicable laws,
regulations, and listing rules, including those of the UK
Corporate Governance Code, as of the end of the financial
year. As explained in relation to Provision 24 of the UK
Corporate Governance Code on page 107, the Audit
Committee comprises two Independent Non-Executive
Directors as at the signing date, rather than the recommended
three. The Board considers this composition appropriate in
light of the overall Board structure and remains committed to
reviewing additional appointments at the appropriate time. In
the introduction to this Governance section on page 107, we
further describe our compliance with recommendations for
tenure.
The Audit Committee has deep knowledge of, and significant
business experience in, financial reporting, risk management,
sustainability reporting, internal control, and strategic
management. This combined knowledge and experience
enables the Audit Committee to perform its duties properly. In
addition, the Board of Directors has determined that the
members of the Audit Committee have the relevant shipping
sector knowledge. In the opinion of the Board of Directors, the
Chair of the Audit Committee, Göran Trapp, meets the
requirement of bringing recent financial experience to the
Audit Committee.
The Audit Committee also has access to the financial
expertise in TORM and its independent auditors and can seek
further professional advice at TORM’s expense, if required.
Meetings
The Audit Committee meets at least four times a year. The
Chief Financial Officer, the Head of External Reporting, the
Head of Group Internal Control, and senior representatives of
TORM’s independent auditors are invited to attend all or some
of the meetings by invitation as appropriate.
Principal Activities in Focus
Financial Reporting
• Key elements in TORM’s Quarterly Reports, Annual Report,
and the estimates and judgments included in TORM’s
financial statements and disclosures.
• The appropriateness of the Management’s analysis and
conclusions on judgmental accounting matters.
• An assessment of whether the Annual Report, taken as a
whole, is fair, balanced, and understandable, and whether
our US annual report on Form 20-F complies with relevant
US regulations with focus on clarity of disclosures,
compliance with relevant legal and financial reporting
standards, and application of appropriate accounting
policies and judgments.
• The going concern assessment and adoption of the going
concern basis in preparing the Annual Report and financial
statements.
• The external auditor’s reports on its audit of the financial
statements and internal control over financial reporting.
• Reports from the Management on the effectiveness of
TORM’s internal control over financial reporting
• Compliance with applicable provisions of the Sarbanes-
Oxley Act (SOX).
• A quarterly assessment of the impairment indicator test of
the vessels in the fleet.
→ Read about the Audit Committee’s area of responsibility
under TORM’s Governance Structure on page 110
→ Read the Terms of Reference for the Audit Committee here:
www.torm.com/investor/governance/governance-
documents-and-policies/
GOVERNANCE > COMMITTEE REPORTS > AUDIT COMMITTEE REPORT
TORM ANNUAL REPORT 2025 115
At a Glance
Chair
Göran Trapp
Members
Annette Malm Justad
David N. Weinstein (until 06 January 2026)
Composition
The Audit Committee is composed solely of Independent Non-
Executive Directors.
Meetings
The Audit Committee held five scheduled meetings in 2025.
The members’ attendance at the committee meetings can be
seen on page 113.
2025 Highlights
• Preparation for provision 29 of the 2024 UK Corporate
Governance Code
• Implementation of measures related to the ‘Economic
Crime and Corporate Transparency Act: failure to prevent
fraud’
• First time CSRD reporting (based on 2024)
Sustainability Statement
• Review and approval of the Sustainability Statement.
• Approval and ongoing evaluation of the double materiality
assessment.
• Oversight of sustainability governance and data quality.
• Monitoring progress against established ESG targets and
transition plans.
• The external auditor’s reports on its limited assurance
review on the Sustainability Statement.
Risk and Compliance
• Reports from the Group Legal Department on the status of
significant litigation, claims, and investigations from tax
authorities.
• Compliance review of the 2024 UK Corporate Governance
Code recommendations.
• The appropriateness of the Enterprise Risk Management
(ERM) Report representing critical risk factors, ownership
and governance, and alignment with the Risk Committee.
• Concerns raised through the whistleblower setup process
and their remediation.
External Audit
• Monitoring the effectiveness and quality of the external
audit process through examination and review of the
coverage provided by the external auditor’s audit plan.
• Reviewing reports from the external auditor on key audit
and accounting matters, business processes, internal
controls, and IT systems.
• Agreeing the audit and non-audit fees of the external
auditor during the year, including the objectivity and
independence of the external auditor.
Significant Reporting Issues
In the financial statements, there are several areas requiring
the exercise of judgment by the Management. The Audit
Committee’s role is to assess whether the judgments made by
the Management are reasonable and appropriate. To assist in
this evaluation, the CFO presents an accounting paper to the
Audit Committee once a year, setting out the key financial
reporting judgments. The main areas of judgment considered
by the Audit Committee in the preparation of the financial
statements are as follows:
Going Concern
The Audit Committee reviewed the Management’s assessment
for preparing TORM’s financial statements on a going concern
basis. This included reviewing and challenging the
Management’s forecast and the underlying base and reverse
stress case calculations along with its assumptions. The Audit
Committee also considered TORM’s available liquidity,
including undrawn and committed facilities along with any
liquidity-enhancing projects and projections for the financial
covenants within TORM’s borrowing facilities.
Based on this, the Audit Committee confirmed that the
application of the going concern basis for the preparation of
the quarterly reports and year-end financial statements
continued to be appropriate, with no material uncertainties.
Please refer to Note 1 to the financial statements.
→ The going concern statement is set out in the Financial
Review on page 27
Impairment of Vessels
The impairment of TORM’s vessels is a key recurring risk due
to its significance in the context of TORM’s net asset value. If
the Management determines that there are indicators of
impairment, the recoverable amount will be determined based
on the higher of the i) fair value less cost of disposal for the
cash-generating unit (CGU) and ii) the value in use of the CGU.
The Audit Committee regularly reviews the Management's
assessment of the potential indicators of impairment related
to TORM’s vessels in the fleet within the CGU comprised of the
Tanker Fleet of LR2, LR1, and MR vessels. The Management's
indicator assessment includes, but is not limited to, broker
vessel values, time charter rates, weighted average cost of
capital, any other adverse impacts from current economic,
environmental, and geopolitical uncertainty, as well as the
carrying amount of the net assets against the market
capitalization. As the indicators involve complex and subjective
judgments, the Audit Committee thoroughly reviews and
challenges the judgments included in the assessment.
The Audit Committee agreed with the Management's
conclusion that there were no indicators of impairment as at
31 December 2025, and thus the recoverable amount was not
determined. Refer to Note 12 to the financial statements for
further information.
Revenue Recognition
The Revenue Recognition Policy was discussed and it was
agreed to make no changes. Revenue is recognized upon
delivery of services in accordance with the terms and
conditions of the charter parties and is made based on “load
to discharge”, and demurrage is recognized with up to 97%
until actual realization. Accordingly, no revenue is recognized
for the days incurred during a vessel’s positioning voyage to a
load port.
Expected Credit Loss
Allowances for expected credit losses are determined using
the “simplified approach” under IFRS 9, which permits the use
of the lifetime expected loss provision for all trade receivables.
In 2025, the Audit Committee reviewed the Management’s
expected credit loss allowance matrix. While assumptions were
challenged, the Audit Committee ultimately agreed with the
Management’s assessment that no changes were necessary.
Depreciation Policy and Residual Value of Vessels
The Management continues to assess factors that could
influence the useful life of TORM’s fleet, including climate-
related developments, regulatory changes, and market
conditions. Among the drivers considered are TORM’s short-
and long-term climate targets, the IMO’s revised Greenhouse
Gas Strategy, and other emerging regulations aimed at
reducing carbon emissions. While TORM might divest vessels
before the age of 25, the most reliable and stable measure for
the residual value is the scrap value at the age of 25, the point
at which operating and maintenance costs make continued
use economically unviable. This approach reflects industry
practice, as confirmed by a peer analysis showing that most
comparable companies similarly apply a 25-year useful life.
Together with the Management, the Audit Committee reviewed
these drivers as well as industry practices and concluded that
the current accounting policy of depreciating vessels over 25
years remains appropriate.
The residual value of vessels is calculated based on two
elements: Scrap values reviewed on a yearly basis and cost of
voyage to the scrapping location. Until 2025, the Management
gradually incorporated green recycling prices into the
calculation of residual values by applying a weighted average
of green and conventional recycling prices, while continuing to
use a three-year average to reduce volatility. As of 2025, the
calculation is based entirely on green recycling prices. This
change follows an assessment by the Management and
GOVERNANCE > COMMITTEE REPORTS > AUDIT COMMITTEE REPORT
TORM ANNUAL REPORT 2025 116
discussions with the Audit Committee during 2024, which
concluded that the market for green recycling had matured
sufficiently to support full implementation ahead of the
original timeline.
Effectiveness of the Audit Committee
In 2025, the Audit Committee carried out a detailed self-
assessment using a questionnaire and discussions facilitated
by the Head of External Reporting. Based on the self-
assessment, no material concerns arose.
Internal Audit
The Audit Committee assesses the need for an internal audit
function on an annual basis and makes a recommendation to
the Board of Directors. The Audit Committee was satisfied that
based on TORM’s current size, complexity, and internal control
environment, TORM can continue to defer the establishment of
an internal audit function. The decision must be revisited
annually, next in 2026.
In the absence of an internal audit function, internal assurance
is achieved through the work of the Group Internal Control
function and Deloitte’s testing of the entire Internal Control
over Financial Reporting framework (ICFR).
The Audit Committee is satisfied that the internal audit
arrangements continue to provide effective assurance of
TORM’s risk and controls environment. Throughout the year,
the Audit Committee monitored the effectiveness of TORM’s
risk management and internal control systems, including
material financial, operational, and compliance controls.
Internal Controls and Risk Management
The Audit Committee has primary responsibility for the
oversight of TORM’s internal control system, including the risk
management framework, the compliance framework, and the
work of the Group Internal Control function. The Audit
Committee regularly discusses the principles for risk
assessment and risk management related to financial
reporting, and the Committee reviews TORM’s significant risks,
including fraud, and their impact on financial reporting,
including stress testing when relevant.
→ More about principal risks and uncertainties on page 14
The Board of Directors fulfills its responsibility regarding the
effectiveness of the risk management and the ICFR through
the Audit Committee. Since the US listing on Nasdaq in New
York in 2017, TORM has been required to comply with the
Sarbanes-Oxley Act (SOX) resulting in increased regulatory
requirements.
The ICFR to support TORM’s SOX compliance is based on the
Internal Control – Integrated Framework 2013 issued by the
Committee of Sponsoring Organizations of the Treadway
Commission (COSO), which enables best practices and a
strong control environment.
To ensure TORM meets its target of SOX compliance, the Audit
Committee continuously monitors the status of the ICFR. This
oversight by the Audit Committee includes recurring reporting,
including management oversight, the outcome of management
testing, and the status of auditor testing. The Audit Committee
makes sure that the Management sufficiently addresses
deficiencies when they emerge.
2025 was the fourth year that TORM was required to have
controls audited by its external auditor to comply with Section
404(b) of SOX.
Having monitored TORM’s ICFR, the Audit Committee has not
identified any material weaknesses in TORM’s ICFR through
either management testing or external audit.
Sustainability
The Audit Committee is responsible for overseeing the internal
reporting process of the Sustainability Statement at TORM, as
carried out by the Senior Management Team. This oversight
encompasses the entire reporting process, including the
approval of the double materiality assessment and
discussions about the principles of risk assessment and risk
management concerning the Sustainability Statement.
In 2025, sustainability reporting continued as an integrated
part of the Audit Committee annual wheel, with quarterly
updates forming a recurring part of all regular Audit Committee
meetings throughout the year. This approach reflects the
applied governance structure and the responsibility assigned
to the Audit Committee by the Board of Directors.
An on-top assessment and evaluation of the double materiality
assessment was conducted and reviewed by the Audit
Committee, with final approval granted during 2025. A few
changes, prompted by new insights and additional knowledge,
were presented with supporting rationale and documentation,
discussed, and ultimately approved by the Audit Committee.
The Audit Committee received regular updates on progress of
the data collection, including the status of activities and the
measures taken to ensure the accuracy and reliability of the
data to be reported.
The Audit Committee is actively engaged in monitoring the
performance against the established targets to ensure
continued alignment with TORM’s strategic priorities and
regulatory obligations. This includes reviewing progress and
assessing whether the methodology and targets remain
effective in driving the intended outcomes.
External Auditor
The Audit Committee has primary responsibility for overseeing
the relationship with the external auditor, Ernst & Young LLP
(‘EY’).
This includes making the recommendation on the appointment,
reappointment, or removal of the external auditor, assessing
their independence on an ongoing basis, approving the
statutory audit fee, the scope of the statutory audit, and the
appointment of the lead audit engagement partner.
Mark Woodward took over as audit partner in 2024 ahead of
the 31 December 2024 audit as a result of the audit partner
rotation rules. For the 31 December 2025 audit, Mark
Woodward was replaced by David Wilson as the audit partner
following an unanticipated absence which meant that Mark
Woodward was unable to complete the audit.
During the year, EY reported to the Audit Committee on their
independence from TORM. The Audit Committee and the Board
of Directors are satisfied that EY has adequate policies and
safeguards in place to ensure that auditor objectivity and
independence are maintained. The Audit Committee has
recommended to the Board of Directors the reappointment of
the external auditors for the 2026 financial year, and the
Board will be proposing the reappointment of EY at the
upcoming AGM.
Effectiveness of the External Audit Process
The Audit Committee reviewed the quality of the external audit
throughout the year and considered the performance of EY by
undertaking an annual review of the performance of the
independent auditor in a combination of discussions with the
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TORM ANNUAL REPORT 2025 117
Management, reviewing the quality of written deliverables to
the Audit Committee, and reviewing the quality of dialog and
insights provided during Audit Committee meetings. The
findings were considered by the Audit Committee, and it was
agreed that the audit process, independence, and quality of
the external audit were satisfactory. Based on these reviews,
the Audit Committee concluded that there had been
appropriate focus and challenge by EY on the primary areas of
the audit, and that EY had applied robust challenge and
skepticism throughout the audit.
Auditor Independence and Objectivity
In its assessment of the independence of the auditor, and in
accordance with the standard on independence, the Audit
Committee received details of all relationships between TORM
and EY, which may have a bearing on their independence, and
received confirmation from EY that it is independent of TORM
in accordance with applicable laws and regulations.
The Audit Committee maintains a policy and has procedures in
place for the pre-approval of all audit services, audit-related
services, and other services undertaken by the external
auditor. The principal purpose of this policy is to ensure that
the independence and the objectivity of the external auditor
are not impaired. The policies include restrictions on the types
of services which the independent auditor can provide, in line
with the Ethical Standard published by the UK Financial
Reporting Council (FRC). Details of the services which the
independent auditors cannot be engaged to perform were
provided to the Audit Committee at the November 2025 Audit
Committee meeting. A copy of the policy can be made
available on request.
Audit and Non-Audit Fees
Full disclosure of the audit and non-audit fees paid during
2025 can be found in Note 6 to the financial statements.
Audit fees: USD 1.3m
Non-audit fees: USD 0.7m
The independent auditor may be contracted to perform certain
non-audit activities. The Audit Committee believes that this
can be performed without compromising the auditor’s
independence and objectivity. The Audit Committee will
allocate the non-audit work after considering TORM’s policy on
the provision of non-audit services by TORM’s auditors. A copy
of the pre-approval procedures can be made available on
request.
TORM operates under a non-audit services cap of 100% of the
audit fee. Fees relating to non-audit services by EY amounted
to USD 0.7m in 2025, of which USD 0.3m are not required by
EU or national law. The Audit Committee considered that the
services provided during the year were most efficiently
provided by the external auditor. To maintain the external
auditor’s independence and objectivity, the external auditor
did not make any decisions on behalf of the Management.
Whistleblower
TORM’s Whistleblower Charter, which supports the group-wide
Business Principles, is monitored by the Audit Committee.
→ Read more about TORM’s Whistleblower Charter here:
www.torm.com/investor/governance/whistleblower/
The Audit Committee received reports providing details of
matters reported through TORM’s international, confidential
telephone reporting lines and secure e-mail reporting facility,
which is operated by an independent third party, Holst
Advokater. All matters reported are investigated by Holst
Advokater and reported to the Board of Directors as well as to
the Audit Committee together with details of any corrective
actions taken. The Audit Committee also received reports at
each Audit Committee meeting providing details of any fraud
losses during the quarter.
Approval
On behalf of the Audit Committee
Göran Trapp
Chair of the Audit Committee
26 February 2026
GOVERNANCE > COMMITTEE REPORTS > AUDIT COMMITTEE REPORT
TORM ANNUAL REPORT 2025 118
Risk Committee Report
Chair’s Statement
This report provides an overview of how the Risk Committee
operates, the activities of the Risk Committee, and the
Committee’s role in monitoring and reviewing the integrity and
quality of TORM’s company-wide risk management.
The Role of the Risk Committee
→ Read more about the Risk Committee’s area of
responsibility on page 110
→ Read the Terms of Reference for the Risk Committee here:
www.torm.com/investor/governance/governance-
documents-and-policies/
Risk Committee Members
The Board of Directors is satisfied that the Risk Committee
meets the independence requirements and having sufficient
qualifications within risk management and capital market
knowledge to independently assess the appropriateness of
TORM’s risk management and control environment as well as
the planning and execution of the risk management policies
and funding activities.
Meetings
The Risk Committee meets at least three times a year.
Activities During the Year
Ongoing Risk Monitoring and Alignment
At each meeting, the Risk Committee follows up on key risk
indicators to ensure alignment of risk tolerance and actual risk
level. These measures include the principal risks described in
the Risk Management section from page 14 and monitoring of
the compliance with internal risk mandates, such as foreign
exchange, FFA, bunker hedge level, refinance risk, interest rate
hedge level, credit risk, and time charter position. A liquidity
forecast is presented at each Risk Committee meeting.
Cyber Security
Cyber security is a recurring agenda item at each meeting, and
the Risk Committee reviews TORM’s cyber security risks and
maturity status. During the year the Risk Committee approved
TORM's IT Security Policy and IT Risk Management Policy.
Focus this year remained on implementation of the IT and
security strategy aimed at reducing the attack surface,
increasing capabilities to identify threats, and mitigating
vulnerabilities. To reflect TORM’s increasing focus on
digitalization, we added AI adoption and governance as an
oversight item this year. We have also continued our work on
regulatory compliance including requirements for NIS2. During
the year the Risk Committee also did a deep dive on the IT risk
maturity onboard our vessels.
Customer Credit Risk
The Committee continued oversight of customer credit risk
and broader counterparty risks through quarterly reviews,
including an annual policy review. TORM has a well-functioning
customer credit approval process, where all customers are
reviewed prior to commercial charters.
Capital Structure Risks
The Risk Committee reviewed risk considerations related to
TORM’s capital structure, including liquidity position, financial
leverage, TORM’s Distribution Policy, off-balance sheet
liabilities, terms and sources of funding vessel investments,
and fleet employment strategy.
Disruption Indicators
A recurring item for the The Risk Committee is the review of oil
demand disruption indicators. The Committee reviews
development of global and regional EV adoption and peak oil
demand based on scenarios from the IEA. Reviewed scenarios
are Stated Policies (STEPS), Current Policies and Net Zero
Emission scenarios. In STEPS and Current Policies, peak oil is
assumed to remain at current level or rise slightly until the end
of this decade, followed by a gradual decline. STEPS projects
the global energy landscape based on the potential (but not
full) implementation of current and announced policies,
focusing on gradual transitions in energy demand, investment,
and technology advancement without transformative changes.
The Net Zero Emission scenario outlines more aggressive oil
demand decline.
At a Glance
Chair
Göran Trapp
Members
Annette Malm Justad
David N. Weinstein (until 06 January 2026)
Composition
The Risk Committee is composed solely of Independent Non-
Executive Directors.
Meetings
The Risk Committee held four scheduled meetings in 2025.
The members’ attendance at the committee meetings is
described on page 113.
2025 Highlights
• Risk management review of TORM’s policies on insurance,
IT, financial instruments, and our Financial Policy
• Maintained focus on IT security risk
• Review of peak oil demand disruption indicators
• Review of geopolitical risks associated with TORM’s
business
• Review of funding initiatives
• Review and approval of the Enterprise Risk Management
(ERM) Report
• Fraud risk prevention assessment included with the scope
of the Risk Committee’s responsibilities
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TORM ANNUAL REPORT 2025 119
The Risk Committee acknowledges TORM’s vulnerability to
declines in oil demand. Oil demand, while critical, is insufficient
to fully understand TORM’s business, as the ton-miles driven
by regional imbalances, which play a critical role in assessing
logistical efficiency and market dynamics, also depend on
changes in the refinery landscape (such as closures and
capacity additions).
Liquidity Governance
The Risk Committee oversaw TORM’s liquidity risk. TORM
works with break-even levels to ensure sufficient liquidity is
available. At TORM, we ensure that financial gearing related to
loan agreements can manage periods of low profitability and
declining vessel values. TORM identifies the required liquidity-
and financial-leverage cushions to be available by severely
stressing our tanker freight rates and vessel values with low
points values seen since 2000.
Forward Freight Agreements (FFAs) and Liquidity Risk
During 2025, the Risk Committee approved an updated FFA
and Bunker Policy. The FFA and Bunker Policy clearly outlines
acceptable liquidity thresholds and hedging exposure enabling
TORM to hedge freight.
Funding and Funding Sources
The Risk Committee has reviewed funding structure and terms
prior to purchasing second-hand vessels. Moreover, the Risk
Committee reviews geopolitical downside risks associated with
current and future funding sources herein assessment of
effective mitigations. TORM liaises with external advisors to
maintain an updated understanding related to geopolitical
risks.
Maritime Safety Threats
The Risk Committee reviewed the measures taken by TORM to
assess, manage, and mitigate future safety threats.
Safety and Insurance
The Risk Committee reviewed implementation of the SIRE 2.0
vetting regime and war risk insurance. The Committee was
confident in TORM’s efforts.
Fraud Risk
The Risk Committee’s scope of responsibilities was expanded
to include fraud risk assessment. The Committee reviewed
fraud risk assessment and acknowledge that TORM has strong
governance in place.
Review Policies
The Risk Committee reviewed TORM’s IT Policy, Financial
Policy, FFA and Bunker Policy, Insurance Policy, Credit Risk
Policy, and EU ETS Policy. These policies outline core activities
and risks, and the measures which TORM has taken to mitigate
these risks.
Sustainability Reporting
The Risk Committee reviewed an annual update of TORM’s
principal climate-related risks and opportunities. The
Committee assesses transition and physical risks and
opportunities and how they might impact the resilience of
TORM’s strategy. The findings from the scenario analysis were
presented and discussed with the Risk Committee. The
climate-related risks identified through the scenario analysis
exercise have been incorporated into TORM’s annual
Enterprise Risk Management process and is part of the
recurring items discussed at the Risk Committee meetings.
Enterprise Risk Management
The Risk Committee reviewed the key risks faced by TORM and
the underlying drivers of these exposures. The alignment of
actual risk and desired risk was discussed, and the Risk
Committee approved TORM’s risk profile based on these
discussions. Further, the Risk Committee reviewed the
assigned management accountability, which highlights current
and planned risk-mitigating activities.
TORM’s annual Enterprise Risk Management Report was
approved at the Risk Committee meeting in January 2026.
→ Read more about TORM's Risk Management
Approval
On behalf of the Risk Committee
Göran Trapp
Chair of the Risk Committee
26 February 2026
GOVERNANCE > COMMITTEE REPORTS > RISK COMMITTEE REPORT
TORM ANNUAL REPORT 2025 120
Nomination Committee
Report
Chair’s Statement
This Nomination Committee report provides an overview of
how the Nomination Committee operates, an insight into the
Nomination Committee’s activities, and its role in monitoring
and reviewing the integrity of the company’s processes for
governance, succession planning, and employee engagement.
In late 2025, Simon Mackenzie Smith assumed the role of Chair
of the Committee, succeeding Christopher Boehringer, whose
contributions have been invaluable in strengthening our
governance framework. In early 2026, we were pleased to
appoint Göran Trapp to the Committee, following the departure
of David Weinstein. These changes reflect our ongoing
commitment to maintaining robust governance practices and
ensuring alignment with the company’s long-term strategic
objectives.
The Role of the Nomination Committee
The Nomination Committee reviewed the independence of all
Non-Executive Directors pursuant to the UK Corporate
Governance Code. Except for the outgoing Chair, the
Nomination Committee is composed solely of Independent
Non-Executive Directors, who in the opinion of the Board of
Directors, continue to constructively offer strategic guidance,
specialist advice and, challenge TORM’s Management.
In line with TORM’s Articles of Association on the annual re-
election of the remaining directors, all of TORM’s Non-
Executive Directors will submit themselves for re-election at
the 2025 Annual General meeting.
The Executive Directors’ service contracts and the Non-
Executive Directors’ terms and conditions of appointment are
available for inspection at our registered office and will be
available on display at the 2026 Annual General Meeting.
Effectiveness
During the year, the Nomination Committee assessed the
independence, time commitment, and any potential conflicts
of interest of the Non-Executive Directors. The Committee
concluded that all Non-Executive Directors continue to
demonstrate sound independent judgment and devote
sufficient time and attention to effectively discharge their
responsibilities. Simon Mackenzie Smith is considered
Independent upon appointment and although Göran Trapp has
served for longer than nine years from the date of his first
appointment, the Board considers that he continues to
demonstrate independence in his role as a director.
Board Evaluation
In accordance with the UK Corporate Governance Code, TORM
conducts an annual internal evaluation of the Board of
Directors. Following this year’s evaluation, the Board of
Directors requested to further increase their knowledge of
artificial intelligence and its potential impact on the company’s
operations and strategic decision-making.
→ Read more about the Board’s activities on page 114
Employee Engagement
Throughout the year, the Nomination Committee received
regular updates on key elements of TORM’s people strategy,
offering insights into critical areas such as organizational
culture, diversity and inclusion, succession planning, future
leadership capabilities, and colleague engagement. These
updates ensure the Committee remains aligned with long-term
strategic priorities and supports the development of a
resilient, high-performing workforce.
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TORM ANNUAL REPORT 2025 121
At a Glance
Chair
Christopher H. Boehringer (until 16 December 2025)
Simon Mackenzie Smith (from 16 December 2025)
Members
Annette Malm Justad
David N. Weinstein (until 06 January 2026)
Göran Trapp (from 06 January 2026)
Composition
The Nomination Committee is composed solely of Independent
Non-Executive Directors.
Meetings
The Nomination Committee had two scheduled meetings in
2025.The members’ attendance at committee meetings can be
seen can be seen on page 113.
15%
15%
55%
15%
Succession planning
Employee population
Governance
Diversity
Focus Areas
Diversity
The Nomination Committee continued to monitor TORM’s
progress toward its gender diversity ambitions for the Board of
Directors . At the end of 2025, women held 16.7% of
leadership positions, reflecting changes in Board composition
as it expanded briefly to six members. Following the
resignation of David Weinstein in January 2026, female
representation in leadership increased again to 20%. TORM
remains committed to its long-term target of achieving 35%
women in leadership positions by 2030.
→ Read about TORM’s diversity targets on page 77
Since 2020, the Board of Directors has fulfilled its target of
20% female Board members. A new target has been set for
the Board of Directors of 40% women by the end of 2030.
Board Diversity Matrix
Country of principle Executive Offices United Kingdom
Foreign private issuer Yes
Disclosure prohibited under home law No
Total number of directors 6
Succession Planning
Throughout the year, the Nomination Committee maintained a
strong focus on the succession pipeline for TORM’s Senior
Management Team, ensuring continuity of leadership and
sustained organizational performance. This approach not only
mitigates risks associated with unforeseen events, such as the
departure of key individuals, but also reinforces TORM’s
commitment to diversity and inclusion. When compared to the
2024 succession plan, only minimal adjustments were
required, reflecting the company’s high level of stability and
strong retention. This foundation positions TORM well to
continue developing future leaders and supporting long-term
strategic growth.
Retention Rate
At the end of 2025, the retention rate for all office-based
employees was 90%, which is still at a satisfactory level. In
2024 and 2023, the retention rate was 94% and 91%,
respectively.
→ Read more about our employee engagement on page 82
Looking Ahead
in 2026, the Nomination Committee will continue to prioritize
strong governance, succession planning, and diversity across
the Board and senior leadership. Key focus areas will include
advancing gender diversity toward our 2030 and 2035 targets,
strengthening leadership pipelines, and supporting initiatives
that enhance organizational culture and employee
engagement.
The Committee will also oversee ongoing compliance with the
UK Corporate Governance Code, monitor evolving governance
standards, and ensure the Board remains equipped to address
emerging strategic challenges, including technological
developments such as artificial intelligence. These efforts will
reinforce TORM’s commitment to long-term stability,
inclusivity, and sustainable growth.
Approval
On behalf of the Nomination Committee
Simon Mackenzie Smith
Chair of the Nomination Committee
26 February 2026
GOVERNANCE > COMMITTEE REPORTS > NOMINATION COMMITTEE REPORT
TORM ANNUAL REPORT 2025 122
Total 2025 Remuneration of
the CEO
Annual Performance Bonus KPI Outcomes
For 2025, the Remuneration Committee established a KPI bonus scorecard across six areas.
These areas were: ROIC, TCE, CO
2
reduction, Safety and Quality, OPEX, and Administrative Cost
to a maximum bonus potential of120% against which 113% was attained.
Annual Performance Bonus Discretionary
The Remuneration Committee reviews the CEO incentive award prior to payment
using judgment to ensure that the final assessment of performance is fair and
appropriate. If circumstances warrant it, the Remuneration Committee may adjust
the final payment.
The performance metrics of discretionary bonus are specified at the start of the
performance period and are commercially sensitive.
2025 Annual Bonus
63% 50% 113%
Formulaic outcome
percentage of maximum 70%
Committee
discretion maximum 50%
Final outcome percentage of
maximum 120%
Total Remuneration 2025
Long-Term Incentive Plan Awarded in 2025
Restricted Share Units 255,200.00
Exercise price per share DKK 162.38
Vesting over three years 2026 - 2028
Grant value USD 0.72m
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT
TORM ANNUAL REPORT 2025 123
Base Salary, 48%
Annual performance
bonus, 51%
Benefits, 1%
90%
100%
One TORM KPIs 63% of
possible 70%
Committee discretion 50% of
possible 50%
Remuneration Committee
Report
Chair's Statement
The Remuneration Committee report describes the activities of
the Remuneration Committee for the period 01 January 2025
to 31 December 2025.
In late 2025, Annette Malm Justad assumed the role of Chair
of the Committee, succeeding Christopher H. Boehringer,
whose leadership has been instrumental in shaping our
remuneration framework. During this transition, Simon
Mackenzie Smith, Chair of the Board of Directors, joined the
Committee as a member, further reinforcing the Board’s
commitment to strong governance and effective oversight. In
early 2026, we welcomed Göran Trapp to the Committee,
following the departure of David Weinstein, ensuring continuity
and alignment with our governance principles and strategic
objectives.
The Remuneration Committee report sets out remuneration
details for the Executive and Non-Executive Directors in TORM.
It has been prepared in accordance with Schedule 8 of the
Large and Medium-Sized Companies and Groups (Accounts
and Reports) Regulations 2008 as amended (the
"Regulations").
The report is split into three main areas:
• Chair’s Statement
• Annual Report on Remuneration
• Remuneration Policy
The Remuneration Policy, approved by the shareholders at the
Annual General Meeting (AGM) on 11 April 2024, took effect
from the date of that meeting. As of the date of this Annual
Report, TORM plc is in compliance with the requirements of
this Remuneration Policy. During 2025, the Committee
undertook a further review of the Remuneration Policy.
→ Read TORM’s Remuneration Policy at www.torm.com/
investor/governance/governance-documents-and-policies
The annual report on remuneration provides details on
remuneration in the period and additional information required
by regulations. The UK Companies Act 2006 requires that the
auditors report to shareholders on certain parts of the
Directors' Remuneration Report and state whether, in their
opinion, those parts of the report have been properly prepared
in accordance with the regulations. The parts of the annual
report on remuneration subject to audit are indicated in the
report. The statement by the Chair of the Remuneration
Committee is not subject to audit.
The Role of the Remuneration Committee
The Remuneration Committee sets and reviews TORM’s
remuneration policy to ensure it supports business strategy,
drives sustainable performance, and aligns with shareholder
interests. It oversees board and senior management pay,
ensuring structures are fair, competitive, and compliant with
governance standards.
Compliance with the Code
The Remuneration Committee complies fully with the updated
2024 UK Corporate Governance Code, including provision 32.
Full compliance has been ensured following the appointment
of Simon Mackenzie Smith, whose independence has enabled
the committee structure to be fully aligned with the
requirements of provision 32. TORM continues to review the
Committee’s composition regularly to maintain strong
alignment with the Code and TORM’s wider governance
objectives.
Meetings
The Chair and the Executive Director attend the meetings of
the Remuneration Committee except for matters relating to
their own remuneration. The Head of People attended some
meetings, and other members of TORM’s Management attend
when necessary.
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT
TORM ANNUAL REPORT 2025 124
65%
10%
15%
5%
5%
One TORM KPIs
LTIP
Employee remuneration
Governance
Board remuneration
At a Glance
Chair
Christopher H. Boehringer (until 16 December 2025)
Annette Malm Justad (from 16 December 2025)
Members
Simon Mackenzie Smith (from 16 December 2025)
Göran Trapp (from 06 January 2026)
David N. Weinstein (until 06 January 2026)
Composition
The Remuneration Committee is composed solely of
Independent Non-Executive Directors.
Meetings
The Remuneration Committee had two scheduled meetings in
2025. The members’ attendance at committee meetings can
be seen on page 113.
Focus Areas
Activities During 2025
KPIs
In accordance with the UK Corporate Governance Code, the
Remuneration Committee throughout the year consistently
reviewed the agreed 2025 KPI status providing valuable
feedback. In addition, the Remuneration Committee reviewed
and agreed the KPIs for 2026.
To reinforce the One TORM platform and ensure alignment
across the organization, the Remuneration Committee has
confirmed that, for 2026, all employees will continue to be
assessed against a common set of KPIs.
Gender-Based Initiatives
TORM continues to monitor gender representation closely and
has implemented a range of initiatives over the years to
improve diversity. Encouragingly, 2025 has shown a positive
upward trend, and we will maintain momentum through
targeted efforts.
TORM remains committed to advancing diversity and inclusion
through targeted initiatives. We have strengthened
recruitment practices with unconscious bias training and
diverse candidate shortlists, supported employees with flexible
working arrangements and family-related policies. In addition,
we continue to review parental leave and flexible work policies
to ensure they remain competitive and supportive.
These actions reflect our commitment to creating an inclusive
workplace where all employees can thrive and contribute to
TORM’s success.
Performance Assessment
The Remuneration Committee oversaw the evaluation of the
CEO’s performance, ensuring remuneration outcomes were
linked to measurable achievements and sustainable value
creation.
Executive Remuneration
In accordance with Section 5 of the UK Corporate Governance
Code, the Committee determined executive pay outcomes and
incentive awards for the CEO. This included approving annual
salary adjustments, short-term incentive payments, and long-
term incentive grants, ensuring that decisions were aligned
with agreed financial and strategic objectives and supported
the company’s long-term success
Annual Remuneration Policy Review
During the year, the Remuneration Committee undertook a
comprehensive review of TORM’s Remuneration Policy.
Following this assessment, the Committee concluded that no
immediate changes were required. However, in light of recent
changes to the composition of the Board and its Committees,
the Committee recognizes the need to revisit and update the
Policy to ensure continued alignment with governance best
practices and strategic objectives. This revision will be
proposed for approval at the next Annual General Meeting.
At this point, there is no intention to revise the Remuneration
Policy more often than every third year, unless required due to
changes to regulations or legislation.
Looking Ahead
In 2026, the Committee will continue to monitor market trends,
regulatory developments, and investor expectations to ensure
our remuneration framework remains fit for purpose and
supports the company’s strategic priorities.
Approval
On behalf of the Remuneration Committee
Annette Malm Justad
Chair of the Remuneration Committee
26 February 2026
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT
TORM ANNUAL REPORT 2025 125
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT
TORM ANNUAL REPORT 2025 126
Remuneration at a Glance
Executive Director and Chief Executive Officer’s Remuneration
Fixed Pay
Base Salary Effective 01 January 2025
Chief Executive DKK 8.15m
Effective 01 January 2026
Chief Executive DKK 8,36m
Executive Director Salary EUR 70,000 EUR 70,000
Benefits DKK 276,000, covering the running and maintenance expenses associated with a private
vehicle
DKK 276,000, covering the running and maintenance expenses associated with a private
vehicle
Pension Not entitled to any pension Not entitled to any pension
Annual Bonus
Short-Term Incentive Opportunity (% of salary):
Maximum: 120% of the base salary in the financial year 2025
Opportunity (% of salary):
Maximum: 120% of the base salary in the financial year 2026
Long-Term Incentive
Long-Term Incentive Granted a total of 255,200 RSUs vesting over a three-year period, with one third of the
grant amount vesting at each anniversary during the three-year period starting on 01
January 2026. The exercise price for each RSU is DKK 162.38. In addition granted
500,000 Retention RSUs vesting in three years. The exercise price is USD 0.01. Also
granted 233,965 RSUs following exercise of RSUs granted in 2022 and 2023 to reflect
the payment of dividends since the grant date. The exercise price for each RSU is USD
0.01.
Not known at time of publication
Statement of Voting at the AGM
Shareholder voting on the resolutions to approve the annual Remuneration Report put to the 2025 AGM and the Directors’ Remuneration Policy put to the 2024 AGM were as follows:
Votes for % Votes against % Abstentions % Total votes
Annual Remuneration Report 47,797,865
94.2
2,751,231 5.4 185,614 0.4 50,549,096
Directors' Remuneration Policy 53,635,713 88.0 7,094,933 11.7 191,989 0.3 60,730,646
Executive Director and Chief Executive
Officer’s Remuneration
Single Total Figure of Remuneration
The table to the right sets out the 2024-25 remuneration for
Jacob Meldgaard in his roles as Executive Director of TORM plc
and Chief Executive Officer (CEO) of TORM A/S, a subsidiary of
TORM plc.
Base Salary
The base salary is discussed and agreed with the Chair of the
Board of Directors and the Remuneration Committee once a
year. Base salary as of 01 January 2025: DKK 8.152m (USD
1.233m). In addition, the CEO receives EUR 70,000 (USD
80,000) for his role as Executive Director. The CEO’s base
salary was reviewed on 19 January 2026 to determine the
appropriate salary for 2026. The base salary as of 01 January
2026 was determined at DKK 8.356m, and the adjustment of
the salary will take effect as of 01 January 2026.
Taxable Benefits
TORM can place a car costing no more than DKK 1m at the
CEO’s disposal. However, the CEO has instead accepted an
amount of DKK 23,000 per month, covering the running and
maintenance expenses associated with a private vehicle. For
2025, the amount of DKK 276,000 (USD 41,729) was included
in the single figure amount. The % change from 2024 to 2025
related to benefits is solely due to exchange rate.
Other benefits provided directly include two trade periodicals,
a mobile phone, which may be used for both business and
private purposes, a PC at the CEO’s disposal at his home
address, which may be used for both business and private
purposes, including internet access and call charges. No
changes in allowances and benefits are expected for 2026.
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TORM ANNUAL REPORT 2025 127
Total Remuneration for the Financial Year 2025
2025 2024
Fixed pay
(USD'000)
Fixed pay
(USD'000)
Base Salary 1,312.7 1,217.2
Taxable Benefits 41.7 39.8
Pension — —
Total Fixed Remuneration 1,354.4 1,257.0
Variable Pay (USD'000)
Annual Performance Bonus 1,393.0 1,232.6
Total Variable Pay
1)
1,393.0 1,232.6
Single Total Figure of Remuneration (USD'000) 2,747.4 2,489.6
Change in Remuneration of Colleagues and Directors
% change from 2024 to 2025
Salary Benefits Bonus
Employee Entire Group 5.6 % 0.0 % -36.9 %
Chief Executive Officer 7.8 % 4.9 % 13.0 %
1) USD Value estimated at time of report
Performance Bonus 2025
The Remuneration Committee has provided the CEO with a
performance cash bonus for the financial year 2025 in the
following range and based on the following parameters:
• The fulfillment of specific performance metrics set by
TORM (up to 70% of the CEO’s base salary). These include
but are not limited to ROIC, cost structure, highest safety
standards, and environmental footprint
• Up to 50% of the CEO’s base salary based on the sole
discretion of TORM’s Board of Directors
The table below shows the achievement against each of the
performance metrics in our annual bonus and the resulting
total annual bonus payout for the year ended 31 December
2025.
Key One TORM KPIs
Maximum
Payout %
Actual
Payout
% of
Salary
Actual
Payout %
of Overall
Bonus
Parameter 1
Highest Safety and quality standard
70.0 63.0 55.8
CO
2
reduction towards 2025 target
Outperform peers on RoIC
Outperform peers on TCE
Maintain effective OPEX cost base
Maintain effective Admin cost base
Parameter 2
Commercially sensitive 50.0 50.0 44.2
Total
120.0 113.0 100.0
In aggregate, the maximum achievable cash bonus for the
financial year 2025 for the CEO is equal to 120% of the CEO’s
base salary in the financial year 2025. The specific metrics
and calculation methodology for each of the parameters have
been determined by the Board of Directors. Based on the
aforesaid methodology, the CEO’s performance cash bonus for
2025 was determined to be a total of 113.0% (63.0% on
parameter 1 and 50.0% on parameter 2) of the 2025 fixed
annual salary of DKK 8.152m, resulting in an amount of DKK
9,212m (estimated at USD 1,393m).
Long-Term Incentive Program, Restricted Share Units
Granted to the CEO
As part of TORM’s Long-Term Incentive Program and in line
with our Remuneration Policy, the Board of Directors granted
Restricted Share Units (RSUs) to selected employees. These
RSUs are designed to retain and motivate employees by
aligning their interests with those of TORM’s shareholders.
Each RSU, subject to vesting, entitles the holder to one Class
A common share.
The single figure remuneration table for the CEO does not
include any amounts in relation to the RSU awards since 2016,
and there are no performance conditions associated with the
grant of RSUs.
As detailed in announcement no. 09 issued on 29 March 2023,
the CEO was granted a total of 255,200 RSUs which vest in
equal amounts over three years, beginning 01 January 2024.
The exercise price for each RSU was DKK 220.6, corresponding
to the average of 90 calendar days preceding the publication
of TORM plc’s 2022 Annual Report plus a 15% premium In
addition, Executive Director Jacob Meldgaard was granted a
total of 300,000 Retention RSUs. The strike price for these
RSUs is set to one US cent and all the RSUs will vest on 01
March 2026. Vested RSUs may be exercised for a period of
360 days from each vesting date.
As detailed in announcement no. 08 issued on 07 March 2024,
the CEO was granted a total of 255,200 RSUs which will vest in
equal amounts over three years, beginning 01 January 2025.
The exercise price for each RSU was DKK 258.4, corresponding
to the average of 90 calendar days preceding the publication
of TORM plc’s 2023 Annual Report plus a 15% premium .
As detailed in announcement no. 21 issued on 15 May 2024,
the CEO was granted a total of 5,563 RSUs following exercise
of RSUs granted in 2021 and 2022 to reflect the payment of
dividends since the grant date. The exercise price for each
RSU was USD 0.01.
As detailed in announcement no. 02 issued on 06 March 2025,
the CEO was granted a total of 255,200 RSUs vesting in equal
amounts over three years, beginning 01 January 2026. The
exercise price for each RSU was DKK 162.38, corresponding to
the average of 90 calendar days preceding the publication of
TORM plc’s 2024 Annual Report plus a 15% premium.
As detailed in announcement no. 10 issued on 11 April 2025
the CEO was granted a total of 33,559 RSUs following exercise
of RSUs granted 2022 to reflect the payment of dividends
since the grant date. The exercise price for each RSU was USD
0.01.
As detailed in announcement no. 21 issued on 23 September
2025, the CEO was granted a total of 500,000 retention RSUs.
The strike price for these RSUs is set to one US cent and all
the RSUs will vest on 01 October 2028.
As detailed in announcement no. 23 issued on 12 November
2025 the CEO was granted a total of 200,406 RSUs following
exercise of the retention RSUs granted 2023 to reflect the
payment of dividends since the grant date. The exercise price
for each RSU was USD 0.01.
LTIP Element of Jacob Meldgaard’s Remuneration Package
2025
Award 2025 2025
Awarded on 01 January 2025 01 October 2025
Vesting period three years one year
1st vesting date 01 January 2026 01 Oct 2028
Awarded 255,200 500,000
Original exercise price DKK 162.38 USD 0.01
Grant value assuming
100% vesting USD 0.72m USD 11.1m
LTIP Element of Jacob Meldgaard’s Remuneration Package
2025
Award 2025 2025
Awarded on 19 May 2025 10 November 2025
Vesting period Issue window Issue window
1st vesting date Issue window Issue window
Awarded 33,559 200,406
Original exercise price USD 0.01 USD 0.01
Grant value assuming
100% vesting
Covered under
value of original
grant
Covered under
value of original
grant
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TORM ANNUAL REPORT 2025 128
Long-Term Incentive Program – Restricted Share Units Granted
Year 2025 Retention 2025 2024 2023 Ret. Add 2022 Additional 2023 Retention 2023 2022
Grant of RSUs excluding the Executive Director 1,293,434 1,326,087 1,214,988 858,822 144,345 1,333,224 1,248,155 1,137,770
Grant of RSUs to the Executive Director 500,000 255,200 255,200 200,406 35,531 300,000 255,200 255,200
Vesting period in years 3 3 3 1 1 1 3 3
Vesting period in years to the Executive Director 3 3 3 1 1 1
Beginning 01-Oct-2028 01-Jan-2026 01-Jan-25 Vest upon grant Vest upon grant 01-Mar-26 01-Jan-24 01-Jan-23
Exercise period from vesting 360 days after
vesting date
360 days after
each vesting date
Three years after
each vesting date
Within the issuing
period
Within the issuing
period
Three years after
each vesting date
360 days after
each vesting date
360 days after
each vesting date
Black-Scholes model, theoretical market value USD 39.9m USD 4.48m USD 10.9m n/a n/a USD 58.02m USD 14.5m USD 2.7m
Exercise Price (DKK) 162.38 258.4 0.07 220.60 58.00
Exercise Price (USD) 0.01 0.01 0.01
Reduced due to dividend payment (DKK) 153.2 204.5 136.3 0.08
Total RSU's expired un-exercised 6,667 518,418 46,078 467,437 92,155
RSUs exercised within 2023 435,952
RSUs exercised within 2024 3,120 13,118 7,089 467,577 435,967
RSUs exercised within 2025 992,180 166,758 1,580,057 95,567 428,896
Total RSU's exercised by grant year 995,300 179,876 1,587,146 563,144 1,300,815
RSUs outstanding as of 31 December 2025 1,793,434 1,574,620 951,770 63,928 — — 472,774 —
The adjustment RSUs were covered by the value of the original RSU grant. For the share options exercised during the year, the weighted average share price at the date of the exercise amounted to
USD 22.3 (2024: USD 34.4, 2023: USD 34.0).
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TORM ANNUAL REPORT 2025 129
End of Service Gratuity
TORM can terminate the CEO’s Service Agreement giving 12
months’ notice to expire on the last day of a month. The CEO
can terminate the Service Agreement giving six months’
written notice to expire on the last day of a month.
Post-Service Salary
If the CEO dies during his employment, TORM will pay to the
widow or any of his children below the age of 18 the fixed
salary including non-salary benefits for the current month and
a post-service salary for three months equal to the fixed
salary. However, such post-service salary will only be paid until
the date on which the employment would have terminated
because of termination of the Service Agreement.
Claw Back Policy
TORM’s policy regarding the recovery of erroneously awarded
compensation (“Clawback Policy”) is made in accordance with
the applicable rules of the Danish Companies Act, The Nasdaq
Stock Market and Section 10D and Rule 10D-1 of the
Securities Exchange Act of 1934, as amended. In the event
TORM is required to prepare an accounting restatement due to
material noncompliance with any financial reporting
requirements under U.S. securities laws, or if TORM otherwise
has published erroneous data, or if TORM determines there
has been a significant misconduct that causes material
financial, operational, or reputational harm, TORM shall be
entitled to recover a portion or all of any incentive-based
compensation provided to certain executives who, during a
limited time period preceding the date on which an accounting
restatement is required, received incentive compensation,
through the LTIP or STIP, based on the erroneous financial
data that exceeds the amount of incentive-based
compensation the executive would have received based on the
restatement.
Total Pension Entitlements
The directors of TORM plc are not entitled to any pension
contributions from TORM. In addition, Denmark-based
Executive Director Jacob Meldgaard, in his role as CEO of
TORM A/S, is not entitled to any pension contribution.
Taxable Benefits
In general, members of the Board of Directors of TORM plc do
not receive any additional benefits.
Payments for Loss of Office
No payments for loss of office have been made in 2025.
TORM does not consider making payments for loss of office to
Non-Executive Directors. For Executive Directors, a termination
notice cannot exceed 24 months. Termination by the
Executive Director must be subject to a minimum of six
months’ written notice. Any severance pay cannot exceed an
amount corresponding to the remuneration paid for the
preceding two years. The Remuneration Committee will
maintain a discretionary approach to the treatment of leavers
given that the facts and circumstances of each case are
unique. In an exit situation, the Remuneration Committee will
consider the individual circumstances, any mitigating factors
that may be relevant, the appropriate statutory and
contractual position, and the requirements of the business for
speed of change.
Outside Appointments
The Executive Director is entitled to retain the fees earned
from non-executive appointments outside TORM. Jacob
Meldgaard was appointed Non-Executive Director of Danish
Ship Finance A/S for which he received DKK 450,000 and Non-
Executive Director of SYFOGLOMAD Limited for which he
received EUR 5,000 for his services. In addition, Jacob
Meldgaard is a member of the board of Copenhagen
International School for which he receives no fee.
Annual Bonuses and LTIPs
TORM’s Remuneration Policy stipulates that the Non-
Executive Directors’ remuneration cannot include participation
in share or warrant programs. The Non-Executive Directors of
TORM plc do not receive any part of their remuneration from
TORM in shares or warrants. The remuneration for the Non-
Executive Directors is determined by the Board of Directors
subject to limits in TORM’s Articles of Association. During
2025, none of the Non-Executive Directors received any part
of their remuneration in shares or warrants.
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TORM ANNUAL REPORT 2025 130
The Executive Director’s Interests in the
Shares of TORM
The table to the right summarizes the total interests of the
Executive Director in shares of TORM plc as of 31 December
2025. During the period 01 January to 31 December 2025, the
Executive Director sold 132,103 A-shares in TORM plc for a
total value of approximately DKK 16.8m. No changes took
place between 31 December 2025 and 26 February 2026.
Aggregate Gain Made by Directors on Exercise
of Options
In 2025, the Executive Director exercised 704,099 Restricted
Share Units, resulting in an aggregate gain of DKK 89.4m (USD
13.8m).
The Board Directors’ Interest in the Shares of
TORM
The table to the right summarizes the total interests of the
members of the Board of Directors in shares of TORM plc as of
31 December 2025. During the period 01 January to 31
December 2025, Non-Executive Director Annette Malm Justad
sold 2,700 A-shares in TORM plc for a total value of
approximately DKK 0.31m. No changes took place in the
Directors’ interests between 31 December 2025 and 26
February 2026.
Remuneration for Non-Executive Directors
The table to the right summarizes the remuneration paid to the
Non-Executive Directors of TORM in 2025. The fees payable
can be found in the Remuneration Policy and are paid in EUR.
The increase in fees in USD is in relation to exchange rates.
The fees in EUR remain unchanged year on year. The fees
shown include any additional fees paid in respect of chairing
of committees or other roles such as Senior Independent
Director (SID). Board Observer fees are no longer payable. The
increase in committee fees in 2025 is due to the introduction
of a Transaction Committee.
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TORM ANNUAL REPORT 2025 131
Executive Director’s Interests in the Shares of the Company (Audited)
Jacob Meldgaard's Restricted Share Units Awarded
Vested not
Exercised
Agreed not to
Exercise Exercised Unvested
At 31/12/24 3,369,123 1,021,380 766,035 771,307 810,401
Granted – 01/01/25 255,200 — — — 1,065,601
Granted – 19/05/25 33,559 — — — 1,099,160
Granted – 23/09/25
500,000
1,599,160
Granted – 10/11/25
200,406
1,799,566
Expired un-exercised within 2025 85,067 1,714,499
Exercised within 2025
—
— — 704,099 1,010,400
At 31/12/25 4,358,288 1,106,447 766,035 1,475,406
2025 Statement of Directors' Shareholding and Share Interests
Director
Ordinary
shares as of 01
Jan 2025
Ordinary
shares as of 31
Dec 2025
Changes from
31 Dec 2025 to
26 Feb 2026
Ordinary
shares as of 26
Feb 2026
Christopher H. Boehringer (outgoing) 21,204 21,204 — 21,204
Simon Mackenzie Smith (incoming) — — — —
David N. Weinstein 5,000 5,000 — 5,000
Göran Trapp — — —
Annette Malm Justad 2,700 — — —
Jacob Meldgaard — 602,599 — 602,599
The above table shows the total number of share interests of each director.
2025 Remuneration Table Non-Executive Directors
USD '000 Base Fee Committee Fee Total
Director 2025 2024 2023 2025 2024 2023 2025 2024 2023
Christopher H. Boehringer (outgoing) 173 159 161 58 53 54 231 212 214
Simon Mackenzie Smith (incoming) — n/a n/a — n/a n/a — n/a n/a
David N. Weinstein 114 108 109 143 108 109 257 217 219
Göran Trapp 57 54 55 143 108 109 200 163 164
Annette Malm Justad 57 54 55 172 108 109 229 163 164
Information provided in the following part of the Annual Report
on remuneration is not subject to audit.
Assessing Pay and Performance
The top chart illustrates TORM’s total shareholder return (TSR)
since the listing of TORM plc, compared with the average TSR
of key industry peers and the OMX Copenhagen index. The
OMX index is a market cap weighted index of all stocks listed
on Nasdaq in Copenhagen. This comparison provides our
shareholders with a clear view of TORM’s performance relative
to both its sector and the broader Danish equity market,
further highlighting the value created for our investors beyond
general market movements. The total shareholder return is
calculated in USD.
In the lower table to the right, we summarize the Chief
Executive Officer’s single figure remuneration over the past
nine years, and how our variable pay plans have paid out in
relation to the maximum opportunity of 120% of base salary.
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT
TORM ANNUAL REPORT 2025 132
67%
60%
45%
117%
100%
100%
57%
114%
108%
113%
1,473
1,626
1,531
2,208
2,307
2,449
1,744
2,513
2,490
2,747
Annual bonus (% earned of base salary)
Total remuneration USD '000
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
0
500
1,000
1,500
2,000
2,500
3,000
0%
20%
40%
60%
80%
100%
120%
8-Year Historical Performance. TORM plc vs Peers and the OMX Index
Financial Year Remuneration for the Chief Executive Officer
72
71
51
62
56
58
129
218
251
143
96
106
108
112
134
177
176
199
241
178
Peer average
TORM
OMX
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
0
100
200
300
Annual Percentage Change in Directors’
Remuneration
The first table below shows the percentage change over the
year ended 31 December 2024 to the year ended 31
December 2025 with respect to the directors’ remuneration
and average employee remuneration. As required by
legislation, the directors’ remuneration is compared to the
employees of TORM plc on a full-time equivalent basis.
Relative Importance of Spend on Pay
The second table below shows the actual expenditure of TORM
on employee pay and distributions to shareholders compared
to the retained earnings of TORM.
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TORM ANNUAL REPORT 2025 133
Change in Remuneration of Colleagues and Directors
Salary or Fees % Change Benefits % Change Bonus % Change
2024 to
2025
2023 to
2024
2022 to
2023
2021 to
2022
2020 to
2021
2024 to
2025
2023 to
2024
2022 to
2023
2021 to
2022
2020 to
2021
2024 to
2025
2023 to
2024
2022 to
2023
2021 to
2022
2020 to
2021
Chief Executive Officer 7.8 % 1.8 % 7.5 % -10.6 % 10.1 % 4.9 % 0.0 % 2.9 % -11.8 % 7.4 % 13.0 % -3.5 % 115.5 % -49.0 % 2.1 %
Christopher H. Boehringer 9.1 % 1.1 % 2.2 % -10.9 % -8.1 % N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Simon Mackenzie Smith N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
David N. Weinstein 18.5 % 4.8 % 5.8 % -11.4 % 16.8 % N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Göran Trapp 22.9 % 4.8 % 5.8 % -11.7 % 2.9 % N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Annette Malm Justad 40.8 % 4.8 % 5.8 % -11.7 % 26.5 % N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Colleagues entire group 5.6 % 4.2 % 5.7 % 4.6 % 3.5 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % -36.9 % 94.1 % -15.2 % 1.9 % 1.5 %
The comparative figures used to determine the % change take into consideration the CEO's salary and benefits.
Other benefits provided relate directly to company car benefit.
% change in DKK for salary and Executive Director’s fees is 3.0%, taxable benefits is 0%, and annual bonus is 7.8%.
% change in Euro for Non-Executive Director fees is 12.5% for David Weinstein, 16.7% for Göran Trapp, and 33.3% for Annette Justad. Fees Increased due to the addition of a Transaction Committee
Simon Mackenzie Smith received zero remuneration for 2025
Relative Importance of Spend on Pay
Expenditure USDm
2025 2024 2023 2022 2021 2020
Dividends paid 199.7 553.3 586.4 166.7 — 70.6
Purchase/disposals of treasury shares — — — — 1.3
Executive Director’s remuneration 2.7 2.5 2.5 1.7 2.4 2.3
Total 202.4 202.4 588.9 168.4 2.4 74.2
Staff costs 97.3 87.0 77.9 49.7 52.1 50.7
Retained earnings 2,085.0 1,791.5 1,382.2 1,290.4 899.5 939.2
Remuneration Policy
The TORM plc Remuneration Policy approved at the 11 April
2024 Annual General Meeting (AGM) remained unchanged
during 2025. In accordance with the UK Corporate Governance
Code, TORM’s Remuneration Policy and practices are designed
to support the business strategy and promote TORM’s long-
term sustainable success. The Remuneration Committee will
continue to consider the appropriateness of the Remuneration
Policy annually to ensure that it continues to align with the
business strategy. At this point, there is no intention to revise
the Remuneration Policy more often than every third year,
unless required due to changes to regulations or legislation.
→ TORM’s Remuneration policy at www.torm.com/investor/
governance/governance-documents-and-policies
2026 Remuneration Policy
The Remuneration Policy approved at the 11 April 2024 AGM
took effect from the date of that meeting.
A revised Directors’ Remuneration Policy is presented in this
Annual Report for shareholder approval. Subject to approval at
the AGM, the new policy will apply from 2026.
Adaptation and Publication
The Board of Directors must review the Remuneration Policy at
least once a year. Any changes to the Remuneration Policy
must be adopted by the Board of Directors and approved by
the shareholders at an AGM.
TORM’s Remuneration report will be included in TORM’s Annual
Reports for all financial years and will contain information on
remuneration paid to the Board of Directors and Executive
Management.
Approval
On behalf of the Remuneration Committee
Annette Malm Justad
Chair of the Remuneration Committee
26 February 2026
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TORM ANNUAL REPORT 2025 134
Remuneration Policy
Our current Remuneration Policy was approved by
shareholders at the 2024 AGM, with a vote of 88% in favor of
those that voted. During the year, the policy operated as
intended in terms of Company performance and quantum. It is
intended that the updated policy for TORM’s Executive and
Non-executive Directors will operate for a period of three years
from the date of approval at the AGM on 15 April 2026.
This Remuneration Policy has been designed to promote
long-term sustainable success of the Company, taking into
account the long-term interests of shareholders, wider
stakeholders and the Company’s workforce, in accordance
with the UK Corporate Governance Code.
As in previous Remuneration Reports, our annual bonus is
commercially sensitive and therefore, we will only disclose our
targets in the Remuneration Report following the completion
of the financial year.
The Committee’s review of the Remuneration Policy sought to
ensure that it continues to:
• Apply pay principles which are applicable to all colleagues
across the TORM Group and, in particular, the principle
that the reward package should support the delivery of
TORM’s purpose of being committed to protecting our
employees, our assets, our environment, and our society.
• Be aligned with, and incentivize the delivery of, the Group’s
strategy.
• Foster performances in line with the Group’s culture,
values and behaviors.
• Be aligned with wider workforce pay policies and emerging
best practice.
• Motivate executive talent
• Drive the success of the Company for the benefit of key
stakeholders.
We propose that the policy remains broadly unchanged in
2026, apart from:
• Inclusion of fixed fees for the newly established
Transaction Committee, structured to reflect increased
time commitment without any success-based elements.
• Under the performance scenarios section, Chart 1 has
been updated to reflect the most up-to-date values
available at the time of publication.
• Removal of references to the Deputy Chair and the
Minority Board Observer; adoption of gender-neutral
terminology such as “Chair”.
1. Introduction
In this forward-looking section, we describe our Remuneration
Policy for the Board. We will be seeking shareholder approval
for our Remuneration Policy at the 2026 AGM, and we intend
to implement it at that point.
The following pages set out the Remuneration Policy for the
Directors of TORM plc agreed at the Annual General Meeting
on 15 April 2026, and will take effect from 01 January 2026.
The Board of Directors (the “Board of Directors”) of TORM plc
(“TORM” or the “Company”), has adopted this Remuneration
Policy (the “Remuneration Policy”), including the overall
guidelines on incentive pay.
This Remuneration Policy provides the framework for
remuneration paid to Non-Executive members of the Board of
Directors and certain specified members of the Company’s
Executive Management (the “Executive Management” the
Board of Directors and the Executive Management jointly
referred to as “Management”).
2. Background and General Objectives
The growth and future success of the Company depend on the
efforts of the members of the Management. Therefore, it is the
overall objective of this Remuneration Policy to attract,
motivate, and retain qualified Management members.
The remuneration of members of the Management, including
the size and composition of the Board of Directors, will be
determined with a view to promoting value creation in the
Company, to implementing its short-term as well as long-term
strategic goals, and to creating common interests between
members of the Management and TORM shareholders.
2.1. Consideration When Determining our
Remuneration Policy
The Company does not specifically consult with employees in
relation to this policy and no direct comparison metrics are
applied between employees and the remuneration levels for
the Executive Director(s). However, this Remuneration Policy
seeks to ensure that the combined remuneration paid to
members of the Management for work performed in and for the
Company is market competitive, not only in comparison with
other industry groups, but also in comparison with peer
companies in the global shipping industry. When considering
salary increases for the Executive Director(s), the Company
will seek to ensure comparison with other companies within
the same market capitalization range.
2.2. Statement of Consideration of Shareholder Views
The Chair of the Annual General Meeting of the Company will
inform the shareholders of any proposal made by the Board of
Directors in relation to the level of the Management
remuneration. The Committee is strongly committed to an
open and transparent dialog with shareholders on
remuneration matters, and the Chair will invite comments from
the shareholders before any level is agreed on.
3. Remuneration of the Board of Directors
Members of the Board of Directors receive a fixed annual fee in
line with the amounts set out in Table 1 on the following page.
The level of the fixed annual fee is proposed by the Board of
Directors at the Annual General Meeting after comparison with
other companies within the same market capitalization range.
In line with the UK Corporate Governance Code, all Non-
executive Directors submit themselves for re-election by
shareholders every year at the Annual General Meeting.
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TORM ANNUAL REPORT 2025 135
Shareholders can view Non-executive Directors’ letters of
appointment at the Company’s registered office
Members of the Board of Directors are not offered
participation in any incentive schemes. However, the Executive
Director participates in an incentive scheme of TORM plc’s
subsidiary, TORM A/S, in their role as CEO of that Company.
The Chair of the Board of Directors, as well as the Chair and
members of the committees established by the Board of
Directors, may receive additional fees in line with the amounts
set out in Table 1 below.
Table 1
Board Fees Fee per annum (Euro)
Chair 150,000
Executive Director 70,000
Director 50,000
Board observer Unpaid
Committee Fees Fee per annum (Euro)
Chair of the Audit Committee 50,000
Other Audit Committee members 25,000
Chair of the Risk Committee 50,000
Other Risk Committee members 25,000
Chair of the Nomination Committee
1)
25,000
Other Nomination Committee members
1)
25,000
Chair of the Remuneration Committee 25,000
Other Remuneration Committee members 25,000
Chair of the Transaction Committee
2)
50,000
Other Transaction Committee members
2)
25,000
1) Only payable in the year in which the actual meetings are held.
2) Fees are fixed and not success based
If a member of the Board of Directors is instructed to take on a
specific ad hoc task that falls outside the scope of that
member’s ordinary duties, such member may be offered an
additional fee for the work carried out in relation to such a
task, subject to the approval of the Board of Directors.
Under the UK Companies Act 2006, the Company will be
required to prepare a Remuneration Report for each financial
year, which is made available to the shareholders as part of
the Company’s Annual Report, and which will set out the
details of all payments made to the Board of Directors in the
preceding financial year.
The Remuneration Policy will be subject to a binding
shareholder vote at least once every three years.
TORM may reimburse relevant reasonable expenses, such as
travel and accommodation, in connection with attendance at
meetings of the Board of Directors (or duly appointed
committees of the Board of Directors).
The remuneration principles applicable to members of the
Board of Directors also apply to any Board Observer appointed
in accordance with article 74 or 76 of the Articles of
Association of the Company.
Any fees payable to the members of the Board of Directors
and any Board Observer may be paid in cash or as share-
based payments.
Fees paid to tax advisors for the preparation of UK tax returns.
TORM plc Directors whose UK income is above the threshold of
GBP 100,000 per annum can, if required, use the services of
the Company’s external tax advisors to prepare their personal
UK tax return. The fees incurred by the Company for the
service offered will be deducted from the Director’s net board
fees.
3.1. Approach to the Remuneration of the Executive
Director
When considering the appropriate remuneration for a new
Executive Director, the Remuneration Committee will consider
the level of the fixed annual fee proposed by the Board of
Directors and adopted at the Annual General Meeting as
detailed in Table 2 below. The aim is to provide a remuneration
package which is sufficient to attract, retain and motivate key
talents, while at all times ensuring that the Company pays no
more than necessary with due regard to the best interests of
the Company and our shareholders. The Remuneration
Committee will provide full details of the recruitment package
for any new Executive Director in the next annual report on
remuneration and will provide shareholders with the rationale
for any decisions taken.
3.2. Service Contracts
In accordance with the UK Companies Act 2006, Chapter 5,
Section 228 (1) b, the Company has chosen to issue a written
memorandum setting out the terms of the Non-Executive and
Executive Directors’ contracts. The memorandum is available
for viewing at the Company’s registered office on request.
Under the Company’s Articles of Association, each Director
must retire at the end of the second Annual General Meeting
after their appointment or last reappointment, unless he or she
has been reappointed at that Annual General Meeting.
3.3. Payments for Loss of Office
Non-Executive Directors – the Company does not consider
making payments for loss of office to Non-Executive Directors.
Executive Directors – a termination notice cannot exceed 24
months. Termination by the Executive Director must be
subject to a minimum of six months' written notice. Any
severance pay cannot exceed an amount corresponding to the
remuneration paid for the preceding two years. The
Remuneration Committee will maintain a discretionary
approach to the treatment of leavers given that the facts and
circumstances of each case are unique. In an exit situation,
the Remuneration Committee will consider the individual
circumstances, any mitigating factors that may be relevant,
the appropriate statutory and contractual position, and the
requirements of the business for speed of change.
The Company can terminate the CEO’s Service Agreement
giving at least 12 months’ notice to expire on the last day of a
month. The CEO can terminate their Service Agreement giving
six months’ written notice to expire on the last day of a month.
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TORM ANNUAL REPORT 2025 136
Table 2
Fixed Pay Purpose and Link to Strategy Operation Performance Metrics
Directors’ fees
To attract and retain high-caliber Executive Directors by
offering market competitive fees.
The level of the fixed annual fee is proposed by the Board of Directors at the Annual General Meeting after
comparison with other companies within the same market capitalization range.
There are no performance measures associated with
the Director’s fees.
Base salary
To recruit and retain high-caliber Executive(s) providing
base level remuneration at a competitive market rate.
The salary will be discussed and agreed with the Chair of the Board of Directors once a year in February and
take effect from 01 January that year.
There are no performance measures associated with
the base salary.
Benefits
To provide market competitive benefits to aid retention
and remain competitive in the marketplace
Executive Directors receive a competitive benefits package, which may include a company car, newspapers,
a mobile phone, PC, internet access and call charges. Other benefits may be introduced from time to time to
ensure that the benefits package is appropriately competitive and reflects the circumstances of the
individual Director.
There are no performance measures associated with
this benefit.
Short term incentive plan Purpose and link to strategy Operation and opportunity Performance metrics
Annual Bonus
To encourage and reward delivery of the Company’s
strategic priorities. To provide a variable level of
remuneration based on short-term performance against
the annual plan.
Up to 120% of the base salary in the financial year. Performance is assessed over a financial year. The
Committee determines the level of bonus, taking performance against targets and the underlying
performance of the business into account. The Committee may apply judgment in making appropriate
adjustments to bonus outcomes to ensure they reflect underlying business performance. Malus and
clawback provisions apply.
The fulfillment of specific performance metrics set
by the Company (up to 70% of the CEO’s base
salary). The performance metrics are specified at
the start of the performance period; and up to 50%
of the CEO’s base salary is based on the sole
discretion of the Company’s Board of Directors.
Long term incentive plan Purpose and link to strategy Operation Performance metrics
Share options, restricted share
units, and other share-based
awards
To reward achievement of TORM’s long-term strategy,
creating shareholder value that aligns the economic
interests of Executive Director and shareholders.
Incentives granted under the LTIP are subject to minimum vesting requirements of three years. Each type of award, including all relevant
performance measures, is discussed in greater
detail in 4.2 "Types of Incentives”.
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TORM ANNUAL REPORT 2025 137
4. Remuneration of the Executive Director
4.1. Performance Scenarios
The performance scenarios in the Table 3 below show the
estimated remuneration that could be received by the
Executive Director, both in absolute terms and as a proportion
of the total package under different performance scenarios:
Table 3
Indicative Executive Director Total Remuneration Levels
Minimum Fixed pay and benefits only
On Target Per Minimum + 50% of maximum annual bonus
Maximum Per Minimum + 100% of maximum annual bonus
The following chart gives an illustrative value of the
remuneration package that the Executive Director could
receive under three different performance scenarios, in
accordance with this Remuneration Policy.
The annual bonus maximum is 120% of the CEO’s base salary
in the financial year.
Fixed pay is based on current values at the time of writing. As
it is a fixed figure, there is no minimum or maximum figure.
The Executive Director receives a fixed annual base salary
based on an assessment of the overall objectives of the
Remuneration Policy, market practice, scope and nature of the
work performed, qualifications required, and the performance
of each member.
When the Executive Director is also the CEO of the Company’s
subsidiary TORM A/S, their remuneration will include
compensation from TORM A/S subject to the framework of
this Remuneration Policy.
The Executive Director’s terms of employment with the TORM
Group, including salary, pension, and resignation terms, are
determined by the Board of Directors. A termination notice
cannot exceed 24 months. Resignation by the Executive
Director must be subject to at least six months’ written notice.
Any severance pay cannot exceed an amount corresponding
to the remuneration paid for the preceding two years.
In addition, the Executive Director may be offered to
participate in management incentive plan(s) (“Plan(s)”) or be
offered extraordinary bonuses as well as ordinary benefits,
such as a company car, telephone, internet access, and
newspapers.
Chart 1 - Indicative Executive Director Total Remuneration at
Different Levels of Performance in USDm
Directors fees
Fixed pay
Short term incentive
Minimum
On Target
Maximum
0
0.5
1
1.5
2
2.5
3
3.5
4.2. TORM's Management Incentive Plans
The Plans are established by the Board of Directors
determining the terms and conditions of each Plan within the
framework of this Remuneration Policy.
When determining the composition of a Plan, including the
elements of incentive pay as well as the ratio between fixed
salary and incentive pay under the Plan, due consideration
must be given to the overall objectives of this Remuneration
Policy to avoid undesirable incentives. The Plan should
combine an effective means of attracting and retaining
qualified candidates with a long-term focus on maximizing
shareholder value.
Purpose of Plans
A Plan may comprise a short-term incentive plan (“STIP”) and/
or a long-term incentive plan (“LTIP”), both as described below.
TORM believes that providing the members of the Executive
Management with a proprietary interest in the growth and
performance of TORM will stimulate the individual performance
and enhance shareholder value. TORM also believes that a
significant portion of a named Executive's compensation
should be directly linked to TORM's performance.
This Remuneration Policy has several provisions designed to
protect shareholder interests and promote effective corporate
governance in respect of the Plans, including the following:
• Limitations on grants to the Executive Management and
individual participants in a given calendar year.
• Awards under the Plans are administered by the
Remuneration Committee, an independent committee of
the Board of Directors.
Estimated Present Value. The estimated present value of the
Plans will be disclosed in TORM’s Annual Report.
Terms of Plans
Administration: Based on the recommendations of the
Remuneration Committee, the Board of Directors will generally
administer a Plan and has the authority to grant incentives
under any Plan and to set the terms of the awards, amend any
outstanding incentives or accelerate the time at which any
outstanding incentives may vest, correct any defect in the
Plans or any incentive as it deems necessary, and establish
rules or regulations relating to the administration of the Plans.
See paragraph 4.4 “Adjustments” below. All provisions of the
Plans and any actions taken in this respect will be subject to
applicable law.
Principal Conditions for Granting Incentive Pay.
The attainment of performance targets based on TORM's
strategic and operational initiatives, such as total shareholder
return and cash flow metrics, may be used to determine
allocations under the Plans in addition to discretionary
allocations.
Eligibility
Members of the Executive Management will be eligible to
receive incentives under a Plan when designated as
participants.
Requirements
The Board of Directors has discretion to determine the times
at which such incentives are to be made, the size of such
incentives, the form of payment and all other conditions of
such incentives, including any restrictions, deferral periods or
performance requirements.
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT > REMUNERATION POLICY
TORM ANNUAL REPORT 2025 138
Amendments or Discontinuation
The General Meeting must approve any amendments to or
discontinuation of this Remuneration Policy, which provides
the framework for the Plans. No amendment to nor
discontinuation of this
Remuneration Policy may materially impair any previously
granted award under the Plans without the consent of the
recipient.
Term
No incentives may be granted under a Plan more than ten
years after the date on which this Remuneration Policy was
initially approved by the General Meeting.
Incentive Agreements
Grants of incentives will be subject to the terms and
conditions of the Plans and may also be subject to individual
restrictions imposed by the Board of Directors and detailed in
an incentive agreement between TORM and the relevant
participant.
STIP
The STIP primarily supports the fulfillment of short-term
objectives and goals. Based on the recommendations of the
Remuneration Committee, the Board of Directors can decide to
award annual cash bonuses to members of the Executive
Management in order to meet the overall objectives of this
Remuneration Policy. Such bonuses may be subject to the
attainment of certain performance or other targets.
LTIP
Incentives under the LTIP may be granted in any one or a
combination of the following forms;
• share options
• restricted share units and
• other share-based awards
Each type of award is discussed in greater detail under “Types
of Incentives” below.
The LTIP primarily supports the fulfillment of long-term
objectives and goals.
Maximum Threshold
The maximum threshold for the share based LTIP grants
applicable to the Executive Management as a group is
expected to be approximately 7% of the Company's share
capital from time to time.
Minimum Vesting Requirements
Incentives granted under the LTIP are subject to minimum
vesting requirements of three years for members of the
Executive Management (with incremental vesting permitted
over the vesting period).
Types of Incentives
Each type of award that may be granted under the LTIP is
described below.
Share Options
A share option is a right to subscribe for A-shares in TORM.
The Board of Directors will determine the number and exercise
price of the options and when the options become exercisable.
The term of an option may not exceed ten years. The Board of
Directors may not decrease the exercise price for any
outstanding options after the date of grant other than as
provided for in the Plans or in accordance with the adjustment
principles set out in paragraph 4.4 below. In addition, an
outstanding option may not, as of any date that the option has
a per share exercise price that is greater than the then current
fair market value of a share, be surrendered to TORM as
consideration for the grant of a new option with a lower
exercise price, another award, a cash payment or A-shares,
unless provided for in the Plans or in accordance with the
adjustment principles set out in paragraph 4.4 below.
The option exercise price may be paid in cash, by check, in A-
shares, through a “cashless” exercise arrangement, through a
net exercise procedure (if approved by the Board of Directors)
or in any other manner authorized by the Board of Directors.
TORM intends to make A-shares available upon exercise of any
share options by way of a fresh issuance of A-shares out of
capital and currently has allotment authorities in place in order
to allow any such share issuances to be made by the
Company.
Restricted Share Units
A Restricted Share Unit, or RSU, represents the right to receive
one share on a respective vesting or settlement date from
TORM. Subject to the restrictions provided in the applicable
incentive agreement and the LTIP, a participant receiving RSUs
has no rights as a shareholder to such units, until the RSUs
vest and A-shares are issued to the participant. RSUs may be
granted with dividend equivalent rights; however, unless
determined by the Board of Directors to be paid currently,
TORM must establish a bookkeeping account for the
participant and reflect in that account any securities, cash or
other property comprising any dividend or property
distribution with respect to each share underlying each RSU.
Other Share-Based Awards
The LTIP also permits the Board of Directors to grant eligible
participants awards of A-shares and other awards that are
denominated or payable in, valued in whole or in part by
reference to, or are otherwise based on or related to A-shares,
or the appreciation in value of A-shares.
Termination of Employment or Service
Each incentive agreement may, subject to applicable law,
include provisions requiring the forfeiture of outstanding
incentives in the event of the participant's termination of
employment, if such participant is considered a voluntary
leaver (as defined by the Board of Directors in the individual
agreement) or, in the case of performance-based grants, if
applicable goals or targets are not met.
Claw Back Provisions
RSUs issued under the LTIP are subject to claw back in the
event of material misstatement of the Company’s financial
results, gross misconduct, or material error in the calculation
of performance conditions.
Change of Control
If determined by the Board of Directors and if so, provided in
the incentive agreement, a change of control of TORM (as
defined by the Board of Directors in the individual agreement)
may require that:
• All outstanding incentives will become fully vested and
exercisable.
• All restrictions or limitations on any outstanding incentives
will lapse.
• All performance criteria and other conditions relating to
the payment of incentives will be deemed to have been
achieved or waived by TORM.
• All outstanding options are required to be exercised by a
certain date.
• The surrender to TORM of some or all outstanding options
in exchange for a share or cash payment for each option
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT > REMUNERATION POLICY
TORM ANNUAL REPORT 2025 139
equal in value to the per share change of control value,
calculated as described in the LTIP, over the exercise price.
• Any equitable adjustment will be made to outstanding
incentives as deemed necessary to reflect TORM's
corporate changes; and/or
• An option will become an option relating to the number of
A-shares or other securities or property (including cash) to
which the participant would have been entitled in
connection with the change of control transaction if the
participant had been a shareholder.
See paragraph 4.4 “Adjustments” below.
Transferability of Incentives
The Board of Directors may determine that the incentives
granted under the LTIP may not be transferred except (a) by
will, (b) by the laws of descent and distribution, (c) pursuant to
any court order in connection with separation of domestic
property or (d) as to options only, if permitted by the Board of
Directors and so provided in the applicable incentive
agreement, to immediate family members or to a partnership,
limited liability company or trust for which the sole owners,
members or beneficiaries are the participant or immediate
family members.
Awards to Be Granted
Grants of incentives to members of the Executive Management
will be made by the Board of Directors as deemed necessary
or appropriate considering the overall objectives of this
Remuneration Policy.
4.3. Extraordinary Bonus
The Board of Directors may in individual cases grant a one-off
bonus or other extraordinary incentive-based pay, such as
retention bonus, severance payment, sign-on bonus, or other
schemes in connection with the appointment, provided that it
is deemed necessary by the Board of Directors in order to
meet the overall objectives of this Remuneration Policy. A
grant of extraordinary bonus may consist of cash and/or be
share-based and may be subject to the attainment of certain
performance targets.
4.4. Adjustments
For the various types of incentive-based pay, the Board of
Directors may lay down specific terms governing the lapse of
the scheme or repayment of the incentive-based pay.
In exceptional cases or in extraordinary circumstances, TORM
may reclaim, in full or in part, incentive payments made to
members of the Executive Management (claw back), e.g., in the
event of manifest errors in the accounting figures or other
basis for award or vesting. There is no specific provision on
claw back in the CEO Service Agreement. Under Danish law,
the principle of “condictio indebiti” may apply to payments
made in error. Also, under the Danish Companies Act, a CEO
may be held liable for damages to their employer, in case of
negligence or willful misconduct.
Furthermore, the Board of Directors may lay down provisions
on accelerated vesting or exercise and adjustment of the
incentive-based pay, exercise price, performance targets, etc.,
in the event of changes to the capital structure or other
material events, which would otherwise adversely influence the
value or effect of the incentive-based pay in contravention to
the general objectives of this Remuneration Policy.
In respect of the share limitations provided in the LTIP,
including the number of A-shares subject to the LTIP,
proportionate adjustments may be made by the Board of
Directors in the event of any recapitalization, reclassification,
share dividend, share split, combination of A-shares or other
similar change in the A-shares. In addition, the exercise price
of any outstanding options and any performance goals will be
adjusted downwards for dividends and will also be subject to
other adjustments if necessary to provide participants with
the same relative rights before and after the occurrence of any
such event.
Adoption and Publication
The Board of Directors must review this Remuneration Policy
at least once a year. Any changes to this Remuneration Policy
will be adopted by the Board of Directors and approved by the
shareholders at a General Meeting.
TORM's Remuneration Report will be included in the
Company’s Annual Report for all financial years and will
contain information on remuneration paid to the Board of
Directors and the Executive Management.
This Remuneration Policy is available on TORM's website,
TORM - Governance Documents & policies
This Remuneration Policy has been adopted by the Board of
Directors.
This Remuneration Policy has been prepared in English only.
GOVERNANCE > COMMITTEE REPORTS > REMUNERATION COMMITTEE REPORT > REMUNERATION POLICY
TORM ANNUAL REPORT 2025 140
Investor Information
Dual Listing in Copenhagen and New York
TORM’s A-shares are listed on Nasdaq Copenhagen under the
ticker TRMD-A and on Nasdaq New York under the ticker
TRMD. TORM’s A-shares can move freely between the two
Nasdaq exchanges. TORM’s Transfer Agent is Computershare
Inc, P.O. Box 43006, Providence RI, 02940-3078, USA.
Shareholders
As of 31 December 2025, TORM had approximately 36,511
registered shareholders representing approximately 57% of
the share capital.
TORM is subject to the EU’s Prospectus Regulation and
Transparency Directive which implies that shareholders have
an ownership notification requirement if the ownership
reaches, exceeds or falls below the thresholds 5, 10, 15, 20,
25, 50, or 90 percent, or 1/3, or 2/3.
Based on notifications received during 2025 and 2026 to date,
OCM Njord Holdings S.à r.l. (Oaktree) and Hafnia Limited, are
the only shareholders with more than 5% of the share capital,
holding 26% and 14% of the share capital at the end of 2025
respectively.
Share Information
Exchanges Nasdaq CPH and NY
ISIN (CPH) GB00BZ3CNK81
CUSIP (NY) G89479102
Tickers TRMD A and TRMD
Number of A-shares (end 2024) 101,332,707
Number of treasury shares —
As of 31 December 2025, TORM held zero treasury shares. At
that date, the C-share was held by Oaktree, and the B-share
was held by the Minority Trustee, SFM Trustees Limited, on
behalf of TORM’s non-Oaktree shareholders. These special
shares carried certain defined voting rights in accordance with
TORM’s Articles of Association.
On 06 January 2026, the threshold required to maintain a B-
shareholder was reached, and, in accordance with TORM’s
Articles of Association, both the B-share and the C-share were
redeemed. Following this redemption, neither share class
remains in issue, and the associated special voting rights have
ceased.
At the end of 2025, the members of the Board of Directors
held a total of 628,804 shares, equivalent to a total market
capitalization of DKK 85.9m or USD13.4m. The Board of
Directors and certain employees are limited to trading shares
during a 45-day period after the publication of financial
reports.
Share Price Performance
In 2025, TORM had an average of 98,428,153 A-shares
outstanding. The average daily trading volume on Nasdaq in
Copenhagen has been approximately 275,000 shares and
approximately 800,000 shares on Nasdaq in New York. During
2025, TORM’s share price on Nasdaq Copenhagen declined
from DKK 138.40 to DKK 126.90, primarily reflecting a weaker
USD/DKK exchange rate. On Nasdaq New York, the share price
moved slightly higher from USD 19.45 to USD 19.58.
→ The 2025 share price development is available at
www.torm.com/investor/share
Financial Calendar 2026
15 April 2026 Annual General Meeting
13 May 2026 First quarter 2026 results
26 August 2026 First six months 2026 results
04 November 2026 First nine months 2026 results
Investor Relations
TORM pursues a transparent and consistent dialog with
investors to ensure efficient and fair pricing of our shares. The
TORM share is currently covered by eight analysts,
predominantly from shipping-oriented investment banks.
TORM observes a three-week silent period prior to the
publication of financial reports.
→ Financial reports, investor presentations, and
announcements, are available at www.torm.com/investor
Share Capital
As of 31 December 2025, TORM’s share capital amounted to
USD 1,013,327.09 divided into 101,332,707 A-shares of USD
0.01 each, one B-share of USD 0.01 and one C-share of USD
0.01. A total of 101,332,707 votes are attached to the A-
shares. Only the A-shares are admitted to trading and official
listing on Nasdaq in Copenhagen and Nasdaq in New York. As
of 31 December 2025, TORM holds zero treasury shares.
During 2025, TORM increased our share capital by 4,012,027
A-shares as a result of the issuance of 748,569 new shares in
connection with the delivery of acquired vessels and the
exercise of 3,263,458 Restricted Share Units. In addition,
TORM cancelled 493,371 A-shares previously held as treasury
shares.
Share Pre-Emption Grant
Pursuant to TORM’s Articles of Association and authorities
granted at TORM plc’s AGM on 15 March 2016 (2016 AGM)
and updated authorities granted at TORM plc’s AGM on 14
April 2020 and 11 April 2024, the Board of Directors was
granted authority to allot shares or rights relating to shares
for cash free from pre-emption up to an aggregate nominal
amount of USD 4,941,465, of which the following
authorizations are still active:
• Up to an aggregate nominal amount of USD 1,372,283
which can be offered in connection with any proposed
initial public offering of equity securities on certain US
stock exchanges, of which none were issued from 01
January 2020 to 31 December 2025, leaving a current
authority to issue up to 137,228,300 A-shares.
• Up to an aggregate nominal amount of USD 2,345,198 in
general equity issues including warrants, convertible debt,
and general equity with the issue being at fair value as
determined by the Board of Directors, of which USD
46,057 were issued from 11 April 2024 to 31 December
GOVERNANCE > OTHER > INVESTOR INFORMATION
TORM ANNUAL REPORT 2025 141
2025, leaving a current authority to issue up to
229,914,071 A-shares.
• Up to an aggregate nominal amount of USD 707,025 to
Directors, officers, or employees of TORM or any of its
subsidiaries of which USD 38,057 was issued from 11 April
2024 to 31 December 2025, and the Company has granted
share options over a further 48,565, leaving a current
authority to issue up to 62,040,317 A-shares.
Details of TORM’s CEO’s share scheme and any rights
attached to the shares under this scheme are set out in the
Directors’ Remuneration Report.
Share Pre-Emption Grant
General equity issues - acquisition of vessels
Dates Values
Granted April 11, 2024 2,345,198
Utilized 2024 38,571
Utilized 2025 7,486
Remaining 2,299,141
The U.K. Takeover Code, issued and administered by the U.K.
Takeover Panel, applies to TORM.
Restricted Share Units
As of 31 December 2025, 4,856,526, Restricted Share Units
(RSUs) were outstanding with 3,263,458 being exercised
during 2025.
Share Pre-Emption Grant
Directors, officers, and employees
Dates Values
Granted April 11, 2024 USD 707,025
Utilized
Shares issued since 2024 AGM
authority USD 38,057
Utilized
Grant of remaining options USD 48,565
Remaining USD 620,403
In accordance with TORM’s Remuneration Policy, the Board of
Directors has as part of the Long-Term Incentive Program
(LTIP) granted certain employees RSUs in the form of
restricted stock options. The RSUs aim at retaining and
incentivizing the employees to seek to improve the
performance of TORM and thereby the TORM share price for
the mutual benefit of themselves and TORM’s shareholders.
Each RSU granted under the LTIP entitles its holder to acquire
one Class A common share, subject to vesting.
Share Repurchase Grant
Share Repurchase Grant
Authority Date Value
Granted April 11, 2024 18,145,867
Repurchase Accumulated 0
Remaining
Approx. 8% of TORM's share
capital excluding treasury shares 18,145,867
The directors regard the ability to repurchase issued A-shares
in suitable circumstances as an important part of the financial
management of TORM and therefore consider it to be desirable
to have the authority to make purchases by way of off-market
purchases.
Distribution Policy
On 07 March 2024, TORM amended the Distribution Policy with
effect from the first quarter of 2024. With this, TORM intends
to distribute on a quarterly basis excess liquidity above a
threshold liquidity level. The threshold liquidity level will be
determined as the sum of i) the product of liquidity
requirement per vessel and the number of owned and leased
vessels in TORM’s fleet as at the balance sheet day and ii) a
discretionary element determined by the Board of Directors
taking into consideration TORM’s capital structure, strategic
opportunities, future obligations, and market trends.
In line with the Distribution Policy, the Board of Directors has
approved a dividend of USD 70.9m for the fourth quarter of
2025. The total declared distribution related to 2025
amounted to USD 212.1m. TORM's Distribution Policy for
2025 can be found on TORM's website and in the 2024 Annual
Report.
Voting Rights
Each A-share carries one vote on all resolutions proposed at
the General Meetings of TORM except for the election or
removal of the B-Director. Until the Threshold Date (the first
time at which OCM Njord Holdings S.à r.l. (“Oaktree”) and its
affiliates cease to beneficially own at least one third of the
issued shares), the sole B-share has one vote at the General
Meetings and special administrative rights, including the right
to appoint the Deputy Chair of the Board of Directors. After
the Threshold Date, all directors can be appointed or removed
by passing an ordinary resolution. The B-shareholder has the
right to appoint one Board Observer. Pursuant to the Articles
of Association, no more than one B-share can be issued by
TORM.
TORM can only take certain material actions relating to
supermajority matters and Reserved Matters (as specified in
its Articles of Association) if either (i) the majority of the
directors (who must include the Chair and the B-Director)
approve the relevant action or (ii) (a) in case of a supermajority
action, if the B-Director did not approve such action or attend
the relevant Board meeting, such action is approved by a
shareholder resolution approved by at least 86% of the votes
capable of being cast on such supermajority action or (ii) (b) in
case of a Reserved Matter action, if the B-Director did not
approve such action or attend the relevant Board meeting,
such action is approved by a shareholder resolution approved
by at least 70% of the votes capable of being cast on such
Reserved Matter action.
Until the Threshold Date, the sole TORM C-share has
350,000,000 votes at the General Meetings in respect of
certain Specified Matters only, including the election of
members to the Board of Directors of TORM (including the
Chair, but excluding the B-Director) and certain amendments
to the Articles of Association. The sole C-shareholder, Oaktree,
must continue to hold the C-share as long as it or its affiliates
beneficially own at least one third of the issued shares
(“Threshold Date”). Accordingly, Oaktree may continue to
operate as the TORM’s controlling shareholder, even if Oaktree
does not own a majority of the A-shares. Pursuant to the
Articles of Association, no more than one C-share can be
issued by TORM. A number of the A-shares are issued subject
to restrictions on transfer (“Restricted Shares”) imposed by US
securities laws. These Restricted Shares may only be
transferred pursuant to an effective registration statement
GOVERNANCE > OTHER > INVESTOR INFORMATION
TORM ANNUAL REPORT 2025 142
filed with the U.S. Securities and Exchange Commission (SEC)
or an exemption from the registration requirements of the
United States Securities Act of 1933 as amended. There are
no specific restrictions on the size of a holding of the A-shares
nor the transfer of the A-shares (except for the Restricted
Shares as detailed above), which are both governed by the
general provisions of the Articles of Association and prevailing
legislation.
The B-share can only be transferred to (i) another trustee (it is
currently held by SFM Trustee Limited on behalf of the
minority shareholders), or (ii) TORM if the B-share is redeemed
or (iii) any person who has acquired 100% of the issued A-
shares. The B-share cannot be encumbered.
The C-share is held by Oaktree and can only be transferred (i)
to one of Oaktree’s affiliates or (ii) to TORM if the C-share is
redeemed or (iii) any person who has acquired 100% of the
issued A-shares. The C-share cannot be encumbered.
The B-share and the C-share do not have any rights to receive
dividends or other distributions which TORM decides to pay.
TORM must redeem the B-share and the C-share at the same
time as soon as possible after the Threshold Date for USD
0.01 each. Once redeemed, the B-share and the C-share must
be cancelled, and no further B-shares or C-shares can be
issued by TORM.
Subsequent Events
On 06 January 2026, the Threshold Date was reached, as
Oaktree and its affiliates no longer beneficially owned at least
one third of the issued A-shares. Upon reaching the Threshold
Date, and in accordance with the Articles of Association, TORM
was required to redeem both the B-share held by SFM Trustee
Limited on behalf of minority shareholders and the C-share
held by Oaktree for USD 0.01 each. These shares carried no
rights to dividends or other distributions and, following their
redemption, were cancelled, after which no further B-shares or
C-shares may be issued by TORM.
GOVERNANCE > OTHER > INVESTOR INFORMATION
TORM ANNUAL REPORT 2025 143
Engagement and Decision-Making
The following information forms our section 172 statement, setting out how, in performing their duties over the course of the year, directors regarded the matters set out in section 172(1) (a-f) of the UK
Companies Act 2006.
Our reporting on how our stakeholders have been considered in terms of our business model and governance is integrated throughout this report. TORM's Board of Directors considers, both individually and
together, that they acted in good faith and in the way they consider would be most likely to promote the success of TORM for the benefit of its members as a whole during the year ended 31 December 2025.
Why?
Why is it important to engage?
How?
How did Management and Directors engage?
Outcomes and Actions
What was the impact of the engagement?
Shareholders
Transparent and open shareholder communication is
expected to support the markets’ valuation of TORM
shares and future access to capital in the equity
markets.
To ensure consistent communication to all investors, quarterly and annual
financial statements and other stock exchange announcements are the main
vehicles of communication. TORM maintains regular capital market contact
through analyst and industry presentations, investor meetings, and conference
calls.
TORM’s Management and Directors continuously focus on leveraging the
integrated One TORM platform, TORM’s capital structure, TORM’s ESG agenda,
and product tanker market fundamentals in support of short and long-term ROIC
generation with the aim of maximizing long-term value for TORM’s shareholders.
TORM maintained strong and proactive engagement with the investor community
throughout 2025. We issued regular stock exchange announcements and hosted open
virtual presentations in connection with our quarterly earnings releases, ensuring
transparency and timely communication. Our Management and Investor Relations
team actively participated in a broad range of virtual and in-person meetings and
presentations with investors and analysts across key financial hubs, fostering dialog
and trust. In addition, we continued to prioritize tailored Investor Relations
communication for retail investors, reinforcing our commitment to inclusive
engagement and broad accessibility. These efforts strengthened investor confidence,
enhanced market understanding of TORM’s strategy and performance, and supported
informed decision-making across our stakeholder base.
Employees
TORM’s employees are fundamental to enable us to
do business, and their continued engagement is an
integral part of the decision-making across the
organization. The Board of Directors supports an
open dialog between the Board and the workforce.
TORM regards responsible behavior as a central part
of the company, our business, and the mindset of our
people.
The Board of Directors oversees the mechanisms we have in place to help
ensure that employees can raise any matters of concern, how such matters are
considered and, when necessary, how they are investigated through the
whistleblower setup.
Two employee-elected representatives attended all Board meetings as
Observers. The current Observers include one office-based employee and one
vessel-based employee. Observers are permitted to participate but are not
permitted to formally vote on matters submitted to a vote.
The Board of Directors receives and follows up on the Employee Engagement
Survey performed twice a year.
→
Since 2006, TORM’s Board of Directors has provided a whistleblower setup with an
independent lawyer as part of the internal control system. Read more on page 91
→
The Observers on TORM’s Board of Directors allow TORM’s employees to have a
direct line of questioning to and receive feedback from the Board. Read more on
page 113
→
Read about TORM’s engagement survey within the S1 Report on page 76
GOVERNANCE > OTHER > ENGAGEMENT AND DECISION-MAKING
TORM ANNUAL REPORT 2025 144
Why?
Why is it important to engage?
How?
How did Management and Directors engage?
Outcomes and Actions
What was the impact of the engagement?
Suppliers and Customers
Managing the relationship with suppliers and
customers is an integral part of the way TORM
conducts business.
Beyond national and international regulation, TORM’s largest customers have
their own compliance criteria with which TORM and other product tanker
operators must comply.
Ensuring quality in everything TORM does is part of the One TORM KPI
Framework. Within this framework, the Board of Directors includes a Tradability
KPI ensuring that TORM vessels can meet our customers’ demands.
TORM encourages feedback from its customers and suppliers.
TORM has a high degree of approval by oil majors and regularly receives feedback from
our customers. TORM utilizes this feedback in solving future logistical demands,
understanding our customers’ difficulties and requirements, and to help resolve issues
each time they are encountered.
→ Read more about how TORM meets customer’s requirements on page 13
In 2025, TORM conducted a supplier assessment to establish a baseline and
understand the status of our suppliers to facilitate dialog with them about how we
together can extend and improve the quality of sustainability efforts.
Lenders
Strong relationships with our banks, financial
institutions, and investors support TORM’s ability to
be financially flexible.
TORM maintains ongoing dialog with several funding providers. TORM is engaged
with lenders and potential lenders to be able to fund vessel acquisitions.
TORM is also in dialog with leasing providers for operational lease funding of
vessel acquisitions and for sale-and-leaseback transactions with buy-back
options and no obligations to mitigate stranded asset risk.
TORM is engaged with funding providers to understand ESG risks related to
financing in order to be an attractive and transparent borrower.
During 2025, TORM completed general purpose financing in the Norwegian Bond
market and via new syndicate and bi-lateral bank financing agreements. The majority
of bank financing was completed as Revolving Credit Facilities. TORM has a stable
repayment profile over the coming years with debt maturities extended to 2029. TORM
maintains a strong partnership within our bank group, which consists of bilateral
facilities by specialized shipping banks, leasing facilities, and nine banks participating
in a syndicated facility agreement.
GOVERNANCE > OTHER > ENGAGEMENT AND DECISION-MAKING
TORM ANNUAL REPORT 2025 145
Why?
Why is it important to engage?
How?
How did Management and Directors engage?
Outcomes and Actions
What was the impact of the engagement?
Regulators
As a company incorporated in the UK and listed on
Nasdaq in both Copenhagen and New York, TORM
must ensure that high standards required by several
local regulatory bodies are met.
Through close dialog with the Management and the Committees, and through
compliance systems, the Board of Directors ensures that TORM remains up to
date with the latest regulatory changes. Examples of matters discussed this year
by the Board of Directors or the Committees include:
• IMO regulations on CO
2
emissions
• Danish Shipping and the Charter for More Women in Shipping
• Mærsk McKinney Møller Center for Zero Carbon Shipping as a Mission
Ambassador
• ESG reporting requirements
• Sanctions compliance
→ TORM’s Business Principles ensure that TORM is always in compliance with
legislation and lives up to the commitment to responsible business practices.
Read more on page 91
→ Read TORM’s Corporate Governance statement at www.torm.com/investor/
governance/governance-documents-and-policies
→ Read TORM’s Modern Slavery Statement at www.torm.com/investor/governance/
governance-documents-and-policies
→ Read more about TORM’s participation in Danish Shipping and the Center for
Zero Carbon Shipping on page 12
Community and Environment
TORM remains committed to taking an active role in
caring for communities and our environment. It is not
just our shared duty, but our shared responsibility.
Therefore, TORM continues the work to combat
carbon, sulfur, and other emissions and remains
committed to enabling quality education, as this is a
matter of concern for TORM and its employees. We
believe that by having all involved stakeholders work
together on this, great results can be achieved.
TORM is engaged in several local and global initiatives supporting the different
communities in which TORM operates. We also support efforts to combat the
overarching climate issues faced by the world. Initiatives include our education
foundation, our commitment to the UN SDGs 4 and 13, and our climate
engagement supporting initiatives.
TORM is improving our ESG reporting to gain more insight into our environmental
impact and to enable enhancement opportunities in the future.
→ For information on how the TORM Philippines Education Foundation and TORM
India’s CSR team have been uplifting and supporting the educational development
actions in local communities. Read more from page 76
→ To see how TORM is actively involved in various industry collaborations
supporting our ambitious journey to achieve our 2050 environmental target of
zero CO
2
emissions from our operating fleet, read more from page 51
→ To support TORM’s ambitious CO
2
target, TORM’s Management will be measured
on achieving it. You can read more about TORM’s ESG journey from page 51
GOVERNANCE > OTHER > ENGAGEMENT AND DECISION-MAKING
TORM ANNUAL REPORT 2025 146
Directors’ Report
The Board of Directors is pleased to present the Annual Report
on the affairs of the TORM Group for 2025, including financial
statements and the auditor’s report. Other disclosure
requirements, which form part of the Directors’ Report, are
included in other sections of this Annual Report. Details on
information incorporated by reference are generally set out
under the relevant topics in the Directors’ Report.
→ Read TORM’s section 172 statement on page 144
Statement of Directors’ Responsibility
A Statement of Directors’ Responsibility made by the Board of
Directors regarding the preparation of the financial statements
is required under UK-adopted International Accounting
Standards.
→ Read TORM’s statement of Director’s Responsibility on
page 149
Going Concern
→ Read TORM’s going concern statement on page 27
Corporate Governance Statement
The corporate governance statement sets out how TORM
complies with the UK Corporate Governance Code 2024 and
includes a description of the main features of our internal
control and risk management arrangements in relation to the
financial reporting process.
→ Read TORM’s Corporate Governance Statement at
www.torm.com/investor/governance/governance-
documents-and-policies
→ Read a description of the composition and operation of the
Board of Directors and its Committees on page 111
Other Information Included in the Strategic
Report
The Strategic Report starting on page 3 provides a review of
TORM’s operations in 2025 and the potential future
developments of those operations. Details on greenhouse gas
emissions are included in the strategic report from page 12,
and details on TORM’s general policy relating to recruitment,
training, career development, and disabled employees are
included within TORM’s policies.
→ Read about the directors’ regard for the need to foster
TORM’s business relationship with suppliers, customers,
and other stakeholders on page 144
Directors and Their Interests
→ Read about the directors of TORM who served during the
financial year 2025 and up to the date of signing the
financial statements on page 111
→ Read about the rules relating to the appointment and the
replacement of directors and the directors’ powers can be
found in TORM’s Articles of Association www.torm.com/
investor/governance/governance-documents-and-policies
→ Details of directors’ interests in TORM are set out in the
Remuneration Committee report from page 124
Indemnification of Directors and Insurance
TORM has not granted any indemnity for the benefit of the
directors but has a general Directors’ and Officers’ Liability
Insurance and a Public Offering of Securities Insurance
covering the Prospectus and the Exchange Offer
documentation related to the Corporate Reorganization.
Requirements of the Listing Rules
TORM plc is listed on Nasdaq in Copenhagen and Nasdaq in
New York. The only listing rule requirement regarding the
content of the Annual Report is that TORM’s Annual Report
must comply with the provisions of the UK Companies Act,
including provisions for EEA-listed companies.
With effect from 01 January 2021, TORM plc elected Denmark
as its Home State under the Transparency Directive rules due
to the implications of Brexit. Accordingly, TORM plc has
complied with the guidelines laid down in the Public Statement
from The European Securities and Markets Authority
(ESMA32-61-1156) concerning the application of
transparency requirements by UK issuers with securities
admitted to trading on regulated markets in the EU under
Article 4 of the Transparency Directive, to ensure compliance
and transparency in this Annual Report.
Share Capital
→ Read more about TORM’s share capital within our Investor
Relation section from page 141
Dividends
In line with the TORM’s Distribution Policy,
Sustainability
Information about TORM’s approach to sustainability risks and
opportunities is set out in the Sustainability Statement
starting on page 34. Also included on these pages are details
on our greenhouse gas emissions.
Financial Risk Management
TORM uses financial instruments to manage risks related to
freight rates, bunker fuels, interest rates, and foreign
exchange. For further information on the use of financial
instruments, please see Note 23 to the financial statements.
Details on financial risks are provided in the Risk Management
section on page 14.
Annual General Meeting
TORM’s next Annual General Meeting (AGM) will be held on 15
April 2026. The notice of the AGM, including the complete
proposals, will be available on TORM’s website, www.torm.com,
prior to the meeting and will be available for inspection from
the Company Secretary, Elemental CoSec.
Articles of Association
As per section 21 of the Companies Act 2006, TORM may only
amend its Articles of Association by special resolution.
→ Read TORM’s Articles of Association at www.torm.com/
investor/governance/governance-documents-and-policies
GOVERNANCE > OTHER > STATEMENT OF DIRECTORS' RESPONSIBILITIES
TORM ANNUAL REPORT 2025 147
Retirement, Reappointment, and Appointment
of Directors
In line with TORM’s Articles of Association on file at Companies
House, each director, apart from the B-Director, must retire
from office at the first annual general meeting after their
appointment. TORM’s Directors were re-elected at the 2025
Annual General Meeting and will therefore be due to retire in
2026. The terms and conditions of the appointment of Non-
Executive Directors are set out in TORM's Memorandum of
Terms and Conditions which, in accordance with the UK
Companies Act 2006, Chapter 5, Section 228, is available for
inspection from the Company Secretary, Elemental CoSec.
Payment for Loss of Office
TORM’s policy in regard to payments for loss of office can be
found in the Remuneration Policy.
→ Read TORM’s latest Remuneration Policy at www.torm.com/
investor/governance/governance-documents-and-policies
Research and Development
TORM continues to focus on optimization of assets but does
not allocate specific costs to research and development.
Group Policy Compliance
TORM has implemented a comprehensive compliance program
to ensure that we remain in compliance with rules and
regulations related to our business activities worldwide. As
part of this compliance program, all employees are required to
document that they are aware of and have received all training
required in relation to each compliance area.
Company Branches
The TORM Group has offices in Denmark, India, the Philippines,
Singapore, the UK, the UAE, and the US. Further details on
TORM's global presence are set out on page 196.
Political Donations
No political donations were made during 2025.
Significant Shareholdings
Details on significant shareholdings are set out in the Investor
Information on page 141
Controlling Shareholder
As at 31 December 2025, TORM’s controlling shareholder,
Oaktree, owned TORM plc’s sole C-share, which carries
350,000,000 votes at the General Meetings in respect of
Specified Matters, including election of members to the Board
of Directors of TORM plc (including the Chair, but excluding the
Deputy Chair) and certain amendments to the Articles of
Association.
On 06 January 2026, David Weinstein resigned from the Board
of Directors after the Company reached the threshold required
to maintain a Class B common shareholder, resulting in the
termination of the Class B common shareholder structure and
the discontinuation of the Class B Director role. In addition, on
06 January 2026, the Board of Directors determined that the
threshold date defined in the Articles (being the first time at
which Oaktree and its affiliates ceased to beneficially own at
least one third of the issued shares) occurred. As a direct
result, the C-share was redeemed and cancelled following
which the C-share right to vote 350,000,000 shares has
ceased as from the threshold date.
Recent Developments and Post-Balance Sheet Events
Details of important events affecting TORM which have
occurred since the end of the financial year are disclosed in
Note 2 to the financial statements.
Independent Auditor
Each person who is a director at the date of approval of the
Annual Report confirms that:
• As far as the Director is aware, there is no relevant audit
information of which TORM’s independent auditor is
unaware.
• The Director has taken all reasonable steps that he or she
ought to have taken as a director in order to make him or
herself aware of any relevant audit information and to
establish that TORM’s independent auditor is aware of that
information.
This confirmation is given and should be interpreted in
accordance with the provisions of section 418 of the UK
Companies Act 2006.
Statement by the Directors in Performance of
their Statutory Duties in Accordance with
Section 172(1) of the UK Companies Act 2006
→ Read about TORM’s engagement and decision making
within our Section 172 Statement from page 144
Approval
On behalf of the Board of Directors
Simon Mackenzie Smith
Chair of the Board of Directors
26 February 2026
GOVERNANCE > OTHER > STATEMENT OF DIRECTORS' RESPONSIBILITIES
TORM ANNUAL REPORT 2025 148
Statement of Directors’
Responsibilities
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable
United Kingdom laws and regulations as well as additional
requirements for listed companies in accordance with the
Danish Financial Statements Act.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law, the
Directors are required to prepare the group financial
statements in accordance with UK-adopted International
Accounting Standards (UK-adopted IAS) as well as IFRS
Accounting Standards (“IFRS”) as issued by the International
Accounting Standards Board (“IASB”) and IFRS as adopted by
the EU, as applied to financial periods beginning on or after 01
January 2025 and have elected to prepare the parent
company financial statements in accordance with United
Kingdom Generally Accepted Accounting Practice (United
Kingdom Accounting Standards and applicable law), including
Financial Reporting Standard 101 “Reduced Disclosure
Framework” (FRS 101). Under company law, the Directors must
not approve the financial statements unless they are satisfied
that they give a true and fair view of the state of affairs of the
Group and TORM and of the profit or loss of the Group and the
Company for that period.
Due to the Company having shares listed on a regulated
market in Denmark, the Annual Report and financial
statements are furthermore prepared in accordance with the
additional requirements of the Danish Financial Statements
Act applicable to listed companies (reporting class D).
In preparing these financial statements, the Directors are
required to:
• Select suitable accounting policies in accordance with IAS
8 Accounting Policies, Changes in Accounting Estimates
and Errors and then apply them consistently.
• Make judgments and accounting estimates that are
reasonable and prudent.
• Present information, including accounting policies, in a
manner that provides relevant, reliable, comparable, and
understandable information.
• Provide additional disclosures when compliance with the
specific requirements in UK-adopted IAS as well as IFRS
Accounting Standards (“IFRS”) as issued by the
International Accounting Standards Board (“IASB”) and
IFRS as adopted by the EU, as applied to financial periods
beginning on or after 01 January 2025
(or in respect of the parent company financial statements,
FRS 101) is insufficient to enable users to understand the
impact of particular transactions, other events and
conditions on the entity's financial position and financial
performance.
• In respect of the group financial statements, state whether
UK-adopted IAS as well as IFRS Accounting Standards
(“IFRS”) as issued by the International Accounting
Standards Board (“IASB”) and IFRS as adopted by the EU,
as applied to financial periods beginning on or after 01
January 2025 have been followed, subject to any material
departures disclosed and explained in the financial
statements.
• In respect of the parent company financial statements
state whether applicable UK Accounting Standards,
including FRS 101, have been followed, subject to any
material departures disclosed and explained in the
financial statements.
• Prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
Company will continue in business.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain the
Company’s and the Group’s transactions and disclose with
reasonable accuracy at any time the financial position of the
Company and the Group and enable them to ensure that the
Company and the Group financial statements comply with the
Companies Act 2006 as well as additional disclosure
requirements for listed companies in accordance with the
Danish Financial Statements Act. They are also responsible for
safeguarding the assets of the Group and the Company and
hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
Under applicable laws and regulations, the Directors are also
responsible for preparing a strategic report, Directors’ report,
Directors’ remuneration report, and corporate governance
statement that comply with that law and those regulations
including additional disclosure requirements for listed
companies in accordance with the Danish Financial
Statements Act. The Directors are responsible for the
maintenance and integrity of the corporate and financial
information included on the Company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
GOVERNANCE > OTHER > STATEMENT OF DIRECTORS' RESPONSIBILITIES
TORM ANNUAL REPORT 2025 149
GOVERNANCE > OTHER > STATEMENT OF DIRECTORS' RESPONSIBILITIES
TORM ANNUAL REPORT 2025 150
SAFE HARBOR STATEMENT AS TO THE FUTURE
Matters discussed in this release may constitute forward-
looking statements. The Private Securities Litigation Reform
Act of 1995 provides safe harbor protections for forward-
looking statements in order to encourage companies to
provide prospective information about their business. Forward-
looking statements reflect our current views with respect to
future events and financial performance and may include
statements concerning plans, objectives, goals, strategies,
future events or performance, and underlying assumptions
and other statements, which are statements other than
statements of historical facts. The Company desires to take
advantage of the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 and is including this
cautionary statement in connection with this safe harbor
legislation. Words such as, but not limited to, “expects,”
“anticipates,” “intends,” “plans,” “believes,” “estimates,”
“targets,” “projects,” “forecasts,” “potential,” “continue,”
“possible,” “likely,” “may,” “could,” “should,” and similar
expressions or phrases may identify forward-looking
statements. The forward-looking statements in this annual
report are based upon various assumptions, many of which
are, in turn, based upon further assumptions, including without
limitation, management’s examination of historical operating
trends, data contained in our records and other data available
from third parties. Although the Company believes that these
assumptions were reasonable when made, because these
assumptions are inherently subject to significant uncertainties
and contingencies that are difficult or impossible to predict
and are beyond our control, the Company cannot guarantee
that it will achieve or accomplish these expectations, beliefs,
or projections. Important factors that, in our view, could cause
actual results to differ materially from those discussed in the
forward-looking statements include, but are not limited to, our
future operating or financial results; changes in governmental
rules and regulations or actions taken by regulatory
authorities; inflationary pressure and central bank policies
intended to combat overall inflation and rising interest rates
and foreign exchange rates; general domestic and
international political conditions or events, including “trade
wars” and the war between Russia and Ukraine, the
developments in the Middle East, including the war in Israel
and the Gaza Strip, and the conflict regarding the Houthis’
attacks in the Red Sea; international sanctions against
Russian oil and oil products; changes in economic and
competitive conditions affecting our business, including
market fluctuations in charter rates and charterers’ abilities to
perform under existing time charters; changes in the supply
and demand for vessels comparable to ours and the number of
newbuildings under construction; the highly cyclical nature of
the industry that we operate in; the loss of a large customer or
significant business relationship; changes in worldwide oil
production and consumption and storage; risks associated
with any future vessel construction; our expectations
regarding the availability of vessel acquisitions and our ability
to complete acquisition transactions planned; availability of
skilled crew members other employees and the related labor
costs; work stoppages or other labor disruptions by our
employees or the employees of other companies in related
industries; effects of new products and new technology in our
industry; new environmental regulations and restrictions; the
impact of an interruption in or failure of our information
technology and communications systems, including the
impact of cyber attacks, upon our ability to operate; potential
conflicts of interest involving members of our Board of
Directors and Management; the failure of counterparties to
fully perform their contracts with us; changes in credit risk
with respect to our counterparties on contracts; adequacy of
insurance coverage; our ability to obtain indemnities from
customers; changes in laws, treaties or regulations; our
incorporation under the laws of England and Wales and the
different rights to relief that may be available compared to
other countries, including the United States; government
requisition of our vessels during a period of war or emergency;
the arrest of our vessels by maritime claimants; any further
changes in U.S. trade policy that could trigger retaliatory
actions by the affected countries; the impact of the U.S.
presidential and congressional election results affecting the
economy, future government laws and regulations and trade
policy matters, such as the imposition of tariffs and other
import restrictions; potential disruption of shipping routes due
to accidents, climate-related incidents, adverse weather and
natural disasters, environmental factors, political events,
public health threats, acts by terrorists or acts of piracy on
ocean-going vessels; damage to storage and receiving
facilities; potential liability from future litigation and potential
costs due to environmental damage and vessel collisions; and
the length and number of off-hire periods and dependence on
third-party managers. In the light of these risks and
uncertainties, undue reliance should not be placed on forward-
looking statements contained in this release because they are
statements about events that are not certain to occur as
described or at all. These forward-looking statements are not
guarantees of our future performance, and actual results and
future developments may vary materially from those projected
in the forward-looking statements. Except to the extent
required by applicable law or regulation, the Company
undertakes no obligation to release publicly any revisions or
updates to these forward-looking statements to reflect events
or circumstances after the date of this release or to reflect the
occurrence of unanticipated events. Please see TORM’s filings
with the U.S. Securities and Exchange Commission for a more
complete discussion of certain of these and other risks and
uncertainties. The information set forth herein speaks only as
of the date hereof, and the Company disclaims any intention
or obligation to update any forward-looking statements as a
result of developments occurring after the date of this
communication.
GOVERNANCE > OTHER > SAFE HARBOR STATEMENT
TORM ANNUAL REPORT 2025 151
Financial Statements
Consolidated Financial Statements
Consolidated Income Statement 153
Consolidated Statement of Comprehensive Income 153
Consolidated Balance Sheet 154
Consolidated Statement of Changes in Equity 155
Consolidated Cash Flow Statement 157
Notes to the Consolidated Financial Statements 158
Parent Company Financial Statements
Management Review for TORM plc 200
Parent Company Income Statement 201
Parent Company Statement of Comprehensive Income 201
Parent Company Balance Sheet 202
Parent Company Statement of Changes in Equity 203
Parent Company Cash Flow Statement 204
Notes to Parent Company Financial Statements 205
Other
Independent Auditor's Limited Assurance Report on the
Sustainability Statement
219
TORM Fleet Overview 221
Glossary 223
Alternative Performance Measures 225
TORM ANNUAL REPORT 2025 152
Consolidated Income Statement
01 January-31 December 2025
USDm Note 2025 2024 2023
Revenue 3,4 1,339.5 1,559.2 1,520.4
Port expenses, bunkers, commissions, and other
cost of goods and services sold -421.6 -418.5 -430.3
Operating expenses 5 -252.4 -245.1 -216.0
Profit from sale of vessels 27 19.0 51.3 50.4
Administrative expenses 5,6 -113.8 -95.6 -82.9
Other operating income and expenses 0.1 -0.5 6.3
Depreciation and amortization 9,10,11 -214.5 -192.0 -149.3
Operating profit (EBIT) 356.3 658.8 698.6
Financial income 7 13.3 24.8 14.3
Financial expenses 7 -74.4 -74.1 -60.9
Profit before tax 295.2 609.5 652.0
Tax 8 -9.2 2.0 -4.0
Net profit for the year 286.0 611.5 648.0
Net profit for the year attributable to:
TORM plc shareholders 285.3 612.5 648.3
Non-controlling interest 0.7 -1.0 -0.3
Net profit for the year 286.0 611.5 648.0
Earnings per share for TORM plc shareholders
Basic earnings per share (USD) 30 2.91 6.54 7.75
Diluted earnings per share (USD) 30 2.85 6.36 7.48
Consolidated Statement of
Comprehensive Income
01 January-31 December 2025
USDm 2025 2024 2023
Net profit for the year 286.0 611.5 648.0
Other comprehensive income/(loss):
Items that may be reclassified to profit or loss:
Exchange rate adjustment arising from translation of
entities using a functional currency different from USD 0.9 -0.6 —
Fair value adjustment on hedging instruments 1.1 7.1 3.1
Fair value adjustment on hedging instruments transferred
to income statement -13.9 -19.7 -22.0
Tax on other comprehensive income 3.9 2.6 4.6
Items that may not be reclassified to profit or loss:
Remeasurements of net pension and other post-
retirement benefit liability or asset — -0.1 —
Other comprehensive income/(loss) after tax -8.0 -10.7 -14.3
Total comprehensive income for the year 278.0 600.8 633.7
Total comprehensive income for the year attributable to:
TORM plc shareholders 277.0 601.9 634.1
Non-controlling interest 1.0 -1.1 -0.4
Total comprehensive income for the year 278.0 600.8 633.7
FINANCIAL STATEMENTS > CONSOLIDATED FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 153
Consolidated Balance Sheet
As of 31 December 2025
USDm
Note 2025 2024 2023
ASSETS
Intangible assets
Goodwill 9,12 1.8 1.7 1.8
Other intangible assets 9 4.0 2.0 1.8
Total intangible assets 5.8 3.7 3.6
Tangible fixed assets
Land and buildings 10,11 9.7 8.1 5.5
Vessels and capitalized dry-docking 10,11,12,20 2,792.2 2,826.7 2,070.2
Prepayments on vessels 10 14.1 — 86.0
Other non-current assets under construction 3.4 4.6 4.2
Other plant and operating equipment 10 2.5 3.3 4.4
Total tangible fixed assets 2,821.9 2,842.7 2,170.3
Financial assets
Investments in joint ventures — 0.1 0.1
Loan receivables 4.4 4.5 4.5
Deferred tax asset 8 0.3 3.1 0.4
Other investments 2.7 0.2 —
Total financial assets 7.4 7.9 5.0
Total non-current assets 3 2,835.1 2,854.3 2,178.9
Inventories 13 66.5 68.4 61.7
Trade receivables 14 214.7 183.9 211.0
Other receivables 15 23.7 59.6 60.5
Prepayments 16 39.1 12.2 15.2
Cash and cash equivalents incl. restricted cash 31 163.5 291.2 295.6
Current assets excluding assets held for sale 507.5 615.3 644.0
Assets held for sale 27 24.4 — 47.2
Total current assets 531.9 615.3 691.2
TOTAL ASSETS 3,367.0 3,469.6 2,870.1
USDm Note 2025 2024 2023
EQUITY AND LIABILITIES
Equity
Common shares 17 1.0 1.0 0.9
Share premium 110.2 271.0 260.0
Treasury shares 17 — -4.2 -4.2
Hedging reserves 6.6 15.5 25.6
Translation reserves -0.2 -0.8 -0.4
Other reserves 296.1 320.0 —
Retained profit 1,788.9 1,471.5 1,382.2
Equity attributable to TORM plc shareholders 2,202.6 2,074.0 1,664.1
Non-controlling interest — 0.8 1.9
Total equity 2,202.6 2,074.8 1,666.0
Liabilities
Non-current tax liability related to held-over
gains 8 45.2 45.2 45.2
Deferred tax liability 8 0.2 0.3 3.6
Borrowings 11,19,20,22 714.3 1,061.0 886.9
Other non-current liabilities 18 3.3 2.9 3.0
Total non-current liabilities 763.0 1,109.4 938.7
Borrowings 11,19,20,22 288.8 165.3 172.7
Trade payables 22 41.0 50.0 43.1
Current tax liabilities 0.3 0.7 0.6
Other liabilities 18,22 68.3 61.3 45.2
Provisions 0.7 0.6 0.5
Prepayments from customers 2.3 7.5 3.3
Total current liabilities 401.4 285.4 265.4
Total liabilities 1,164.4 1,394.8 1,204.1
TOTAL EQUITY AND LIABILITIES 3,367.0 3,469.6 2,870.1
FINANCIAL STATEMENTS > CONSOLIDATED FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 154
Consolidated Statement of Changes in Equity
01 January-31 December 2025
USDm
Common
shares
Share
premium
Treasury
shares ¹⁾
Hedging
reserves
Translation
reserves
Other
reserves
Retained
profit
Equity
attributable
to
shareholders
of TORM plc
Non-
controlling
interest Total
Equity as of 01 January 2023 0.8 167.6 -4.2 39.9 -0.5 — 1,297.8 1,501.4 2.3 1,503.7
Comprehensive income/loss for the year:
Net profit/(loss) for the year — — — — — — 648.3 648.3 -0.3 648.0
Other comprehensive income/(loss) for the year²⁾ — — — -18.9 0.1 — — -18.8 -0.1 -18.9
Tax on other comprehensive income — — — 4.6 — — — 4.6 — 4.6
Total comprehensive income/(loss) for the year — — — -14.3 0.1 — 648.3 634.1 -0.4 633.7
Capital increases ³⁾ 0.1 92.6 — — — — — 92.7 — 92.7
Transaction costs of capital increase — -0.2 — — — — — -0.2 — -0.2
Share-based compensation — — — — — — 22.5 22.5 — 22.5
Dividends paid — — — — — — -586.4 -586.4 — -586.4
Total changes in equity 2023 0.1 92.4 — -14.3 0.1 — 84.4 162.7 -0.4 162.3
Equity as of 31 December 2023 0.9 260.0 -4.2 25.6 -0.4 — 1,382.2 1,664.1 1.9 1,666.0
Comprehensive income/loss for the year:
Net profit/(loss) for the year — — — — — — 612.5 612.5 -1.0 611.5
Other comprehensive income/(loss) for the year ²⁾ — — — -12.7 -0.4 — -0.1 -13.2 -0.1 -13.3
Tax on other comprehensive income — — — 2.6 — — — 2.6 — 2.6
Total comprehensive income/(loss) for the year — — — -10.1 -0.4 — 612.4 601.9 -1.1 600.8
Capital increase ³⁾ 0.1 331.6 — — — — — 331.7 — 331.7
Transaction costs of capital increase — -0.6 — — — — — -0.6 — -0.6
Capital reduction ⁴⁾ — -320.0 — — — 320.0 — — — —
Share-based compensation — — — — — — 30.2 30.2 — 30.2
Dividends paid — — — — — — -553.3 -553.3 — -553.3
Total changes in equity 2024 0.1 11.0 — -10.1 -0.4 320.0 89.3 409.9 -1.1 408.8
Equity as of 31 December 2024 1.0 271.0 -4.2 15.5 -0.8 320.0 1,471.5 2,074.0 0.8 2,074.8
FINANCIAL STATEMENTS > CONSOLIDATED FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 155
Consolidated Statement of Changes in Equity
01 January-31 December 2025
USDm
Common
shares
Share
premium
Treasury
shares ¹⁾
Hedging
reserves
Translation
reserves
Other
reserves
Retained
profit
Equity
attributable
to
shareholders
of TORM plc
Non-
controlling
interest Total
Equity as of 01 January 2025 1.0 271.0 -4.2 15.5 -0.8 320.0 1,471.5 2,074.0 0.8 2,074.8
Comprehensive income/(loss) for the year:
Net profit/(loss) for the year — — — — — — 285.3 285.3 0.7 286.0
Other comprehensive income/(loss) for the year ²⁾ — — — -12.8 0.6 — — -12.2 0.3 -11.9
Tax on other comprehensive income — — — 3.9 — — — 3.9 — 3.9
Total comprehensive income/(loss) for the year — — — -8.9 0.6 — 285.3 277.0 1.0 278.0
Capital increases ³⁾ — 19.3 — — — — — 19.3 — 19.3
Transaction costs of capital increase — -0.1 — — — — — -0.1 — -0.1
Capital reduction ⁵⁾ — -180.0 — — — 180.0 — — — —
Treasury share cancellation ¹⁾ — — 4.2 — — -4.2 — — — —
Share-based compensation — — — — — — 34.1 34.1 — 34.1
Dividends paid — — — — — -199.7 — -199.7 — -199.7
Total changes in equity 2025 — -160.8 4.2 -8.9 0.6 -23.9 319.4 130.6 1.0 131.6
Transactions with non-controlling interests — — — — — — -2.0 -2.0 -1.8 -3.8
Equity as of 31 December 2025 1.0 110.2 — 6.6 -0.2 296.1 1,788.9 2,202.6 — 2,202.6
1) Please refer to Note 17 for further information on treasury shares.
2) Please refer to "Consolidated Statement of Comprehensive Income".
3) Please refer to Note 17 for further information on capital increases during the year.
4) The Share premium reserve was reduced by USD 320.0 m, as decided at the Annual General Meeting on 11 April 2024 and subsequently approved by the court, in order to create additional distributable reserves to support: (i) the future payment by the
Company of dividends to its shareholders; and (ii) potential share buybacks should it be desirable to do so.
5) The Share premium reserve was reduced by USD 180.0 m, as decided at the Annual General Meeting on 16 April 2025 and subsequently approved by the court, in order to create additional distributable reserves to support: (i) the future payment by the
Company of dividends to its shareholders; and (ii) potential share buybacks should it be desirable to do so.
FINANCIAL STATEMENTS > CONSOLIDATED FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 156
Consolidated Cash Flow Statement
01 January-31 December 2025
USDm Note 2025 2024 2023
Cash flow from operating activities
Net profit for the year 286.0 611.5 648.0
Adjustments:
Profit from sale of vessels -19.0 -51.3 -50.4
Depreciation and amortization 9,10 214.5 192.0 149.3
Financial income 7 -13.3 -24.8 -14.3
Financial expenses 7 74.4 74.1 60.9
Tax expenses/(income) 8 9.2 -2.0 4.0
Other non-cash movements 28 41.4 22.9 14.5
Interest received and realized exchange gains 11.9 24.8 14.3
Interest paid and realized exchange losses -70.0 -66.9 -66.0
Income taxes paid -2.7 -1.3 -3.1
Change in inventories, receivables and
payables, etc. 28 -33.5 47.8 47.8
Net cash flow from operating activities 498.9 826.8 805.0
USDm Note 2025 2024 2023
Cash flow from investing activities
Investment in tangible fixed assets ¹⁾ -308.5 -582.4 -509.7
Investment in intangible fixed assets -1.8 -1.1 -0.6
Sale of tangible fixed assets 27 143.8 130.6 166.4
Change in restricted cash 13.9 10.8 -26.7
Net cash flow from investing activities -152.6 -442.1 -370.6
Cash flow from financing activities
Proceeds, borrowings 19 338.0 419.4 676.4
Repayment, borrowings 19 -567.7 -256.3 -585.4
Vessel lease extinguishment prepayment -29.1 — —
Dividends paid -199.7 -553.3 -586.4
Capital increase ¹⁾ 17 2.3 12.5 6.2
Transaction costs share issue -0.1 -0.6 -0.2
Transactions with non-controlling interests -3.8 — —
Net cash flow from financing activities -460.1 -378.3 -489.4
Net cash flow from operating, investing, and
financing activities -113.8 6.4 -55.0
Cash and cash equivalents as of 01 January 271.9 265.5 320.5
Cash and cash equivalents as of 31 December 158.1 271.9 265.5
Restricted cash as of 31 December 31 5.4 19.3 30.1
Cash and cash equivalents, including
restricted cash as of 31 December 163.5 291.2 295.6
1) In 2025, capital increase amounted to USD 19.3 m (2024: USD 331.7 m, 2023: USD 92.7 m) including a USD 17.0 m (2024:
USD 319.2 m, 2023: USD 86.5 m) non-cash share issues in relation to the acquisition of 1 (2024: 19, 2023: 5) vessels.
Please refer to Note 18 for further reference.
FINANCIAL STATEMENTS > CONSOLIDATED FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 157
Notes to the Consolidated Financial
Statements
Note 1 – Accounting Policies, Critical Accounting Estimates and Judgments 159
Note 2 – Liquidity, Capital Resources and Subsequent Events 163
Note 3 – Segment 165
Note 4 – Revenue from Contracts with Customers 168
Note 5 – Staff Costs 169
Note 6 – Remuneration to Auditors Appointed at the Parent Company’s Annual General Meeting 171
Note 7 – Financial Items 172
Note 8 – Tax 172
Note 9 – Intangible Assets 174
Note 10 – Tangible Fixed Assets 175
Note 11 – Leasing 177
Note 12 – Impairment Testing 179
Note 13 – Inventories 180
Note 14 – Trade Receivables 181
Note 15 – Other Receivables 181
Note 16 – Prepayments 181
Note 17 – Common Shares and Treasury Shares 182
Note 18 – Other Liabilities 183
Note 19 – Effective Interest Rate, Outstanding Borrowings 184
Note 20 – Collateral Security for Borrowings 185
Note 21 – Guarantee Commitments and Contingent Liabilities 185
Note 22 – Contractual Rights and Obligations 186
Note 23 – Derivative Financial Instruments 188
Note 24 – Risks Associated with TORM’s Activities 191
Note 25 – Financial Instruments 194
Note 26 – Related Party Transactions 195
Note 27 – Assets Held for Sale and Non-Current Assets Sold During the Year 196
Note 28 – Cash Flows 196
Note 29 – Entities in the Group 196
Note 30 – Earnings per Share and Dividend per Share 197
Note 31 – Cash and Cash Equivalents, Including Restricted Cash 198
TORM ANNUAL REPORT 2025 158
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Parent Company 2025
Parent Company FInancial Statements
Management Review for TORM plc 200
Parent Company Income Statement 201
Parent Company Statement of Comprehensive Income 201
Parent Company Balance Sheet 202
Parent Company Statement of Changes in Equity 203
Parent Company Cash Flow Statement 204
Notes to Parent Company Financial Statements 205
TORM ANNUAL REPORT 2025 199
Management Review for TORM plc
2025 marks the first full year after the reorganization in 2024. A result of the restructuring included
that the Parent company now actively manages the deployment of tanker vessels between spot market
voyage charters and time charters on similar terms as other entities in the TORM Group. The parent
company activities still include holding company activities for the TORM Group, treasury activities, as
well as bareboat chartering activities.
Income Statement
In 2025, revenue amounted to USD 260.6m compared to USD 73.8m in 2024. The growth was primarily
driven by the full year impact of transportation of refined oil products on spot market voyage charters
and time charters with an increased revenue of USD 215.1m, offset by a decrease in bareboat charter
hire of USD 28.3m as bareboat charter activities with subsidiaries ended in April 2025.
Costs associated with the transportation (port expenses, bunkers, and commissions) amounted to USD
83.2m in 2025 compared to USD 12.9m in 2024. Similar to the increase in revenue, the development
was primarily driven by the full year impact compared to 2024.
The cost of charter hire in 2025 increased by USD 32.8m to USD 94.8m. This was again a result of the
full year impact of chartering additional vessels from subsidiaries compared to 2024, offset by
generally lower charter hire rates compared to 2024.
Operating expenses increased in 2025 to USD 49.9m. The increase from USD 6.5m in 2024 was also
driven by the full year impact and additionally increased operating days from chartering more vessels
from subsidiaries compared to 2024.
Financial income for 2025 decreased by USD 1,173.4m to USD 192.3m. The decrease was primarily
impacted by lower dividends received from subsidiaries of USD 1,151.2m as 2024 was heavily impacted
by the restructuring of the TORM Group. As part of the restructuring in 2024, the parent company
received dividends from TORM A/S of USD 795.7m related to the parent company’s acquisition of
TORM Singapore Pte Ltd from TORM A/S and USD 479.2m related to the sale of vessels from TORM A/
S to the newly established TORM VesselCo UK Limited.
Net profit amounted to USD 137.9m compared to USD 1,307.2m in 2024 mainly driven by above-
mentioned activities.
Balance Sheet
Assets
Total assets increased by USD 52.3m to USD 2,787.8m as of 31 December 2025, mainly impacted by
increased unsecured loans to subsidiaries of USD 146.3m in connection with financing vessel
transaction on behalf of subsidiaries, and secondly by higher freight receivables of USD 21.4m due to
the full year impact of external chartering activities. The development is offset by a decrease in cash
and cash equivalents of USD 75.7m and a decrease in investments in subsidiaries of USD 42.9m
primarily due to capital reduction in subsidiaries.
Equity
Total equity decreased by USD 20.4m to USD 1,924.7m as of 31 December 2025, primarily driven by
dividends paid of USD 199.7m and the negative impact of hedging reserves related to interest swaps of
USD 15.8m. The decrease is offset by the net profit for the year of USD 137.9m, share-based
compensation of USD 34.1m, and additionally by capital increases of USD 19.3m including USD 17.0m
(2024: USD 319.2m) non-cash share issue in relation to a subsidiary’s acquisition of one vessel.
Liabilities
During 2025, total borrowings increased by USD 73.0m to USD 806.6m mainly impacted by the major
refinancing during 2025 and the financing of vessel transaction on behalf of subsidiaries. This
development was also the primary cause of the increase in total liabilities of USD 72.7m to USD
863.1m.
Cash Flow
Net cash flow from operating activities was USD 92.3m (2024: USD 20.9m). The increase was primarily
driven by the TCE effects of tanker vessels being actively deployed in the market during the entire year
of 2025 compared to only the latter part of 2024.
Net cash flow from investing activities was USD -42.3m (2024: USD 372.9m). The change was mainly
impacted by increased loans to subsidiaries compared to 2024.
Net cash flow from financing activities was USD -125.7m (2024: USD -304.3m). The development was
predominantly impacted by reduced dividend payments, offset by lower net proceeds from borrowings
compared to 2024.
Key developments in 2025
USDm 2025 2024 Change
Income statement
Revenue 260.6 73.8 186.8
Port expenses, bunkers and commissions -83.2 -12.9 -70.3
Charter hire -94.8 -62.0 -32.8
Operating expenses -49.9 -6.5 -43.4
Financial income 192.3 1,365.7 -1,173.4
Net profit for the year 137.9 1,307.2 -1,169.3
Balance sheet
Investments in subsidiaries 2,399.0 2,441.9 -42.9
Freight receivables 45.3 23.9 21.4
Loans to subsidiaries, current and non-
current 280.3 134.0 146.3
Total assets 2,787.8 2,735.5 52.3
Total equity 1,924.7 1,945.1 -20.4
Borrowings, current and non-current 806.6 733.6 73.0
Total liabilities 863.1 790.4 72.7
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > MANAGEMENT REVIEW FOR TORM PLC
TORM ANNUAL REPORT 2025 200
Parent Company Income Statement
01 January-31 December 2025
USDm Note 2025 2024
Revenue 2 260.6 73.8
Port expenses, bunkers and commissions -83.2 -12.9
Charter hire -94.8 -62.0
Operating expenses 3 -49.9 -6.5
Administrative expenses 3 -26.2 -14.8
Other operating income and expenses -2.8 -1.5
Depreciation and amortization 6 -2.8 -0.2
Operating profit/(loss) (EBIT) 0.9 -24.1
Financial income 4 192.3 1,365.7
Financial expenses 4 -48.5 -37.9
Profit before tax 144.7 1,303.7
Tax 5 -6.8 3.5
Net profit for the year 137.9 1,307.2
Parent Company Statement of
Comprehensive Income
01 January-31 December 2025
USDm 2025 2024
Net profit for the year 137.9 1,307.2
Other comprehensive income:
Items that may be reclassified to profit or loss:
Fair value adjustment on hedging instruments -3.0 10.4
Fair value adjustment on hedging instruments transferred to income
statement -12.8 -20.9
Tax on other comprehensive income 4.0 2.6
Other comprehensive income after tax -11.8 -7.9
Total comprehensive income for the year 126.1 1,299.3
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > BALANCE SHEET
TORM ANNUAL REPORT 2025 201
Parent Company Balance Sheet
As of 31 December 2025
USDm Note 2025 2024
ASSETS
Intangible assets
Other intangible assets — 0.1
Total Intangible assets — 0.1
Tangible fixed assets
Capitalized dry-docking and vessel modifications 6 23.6 5.3
Land and buildings 0.8 —
Other plant and operating equipment 0.2 0.2
Total tangible fixed assets 24.6 5.5
Financial assets
Investments in subsidiaries 7, 13 2,399.0 2,441.9
Loan receivables 4.4 4.5
Loans to subsidiaries 16 229.0 65.5
Deferred tax assets 5 — 2.7
Total financial assets 2,632.4 2,514.6
Total non-current assets 2,657.0 2,520.2
Inventories 8 9.3 7.1
Freight receivables 9 45.3 23.9
Loans to subsidiaries 16 51.3 68.5
Other receivables 10 9.5 24.9
Prepayments 0.9 0.7
Cash and cash equivalents 14.5 90.2
Total current assets 130.8 215.3
TOTAL ASSETS 2,787.8 2,735.5
The financial statements of TORM plc, company number 9818726, have been approved by the Board of
Directors and signed on their behalf by:
Jacob Meldgaard
Executive Director
26 February 2026
USDm Note 2025 2024
EQUITY AND LIABILITIES
Equity
Common shares 1.0 1.0
Treasury shares — -4.2
Hedging reserves 5.9 17.7
Share premium 20.3 181.2
Other reserves 296.1 320.0
Retained profit 1,601.4 1,429.4
Total equity 1,924.7 1,945.1
Liabilities
Borrowings 11 683.7 625.3
Total non-current liabilities 683.7 625.3
Borrowings 11 122.9 108.3
Trade payables 7.6 4.7
Payables to subsidiaries 16 33.7 39.4
Current tax liabilities 0.1 —
Other liabilities 12 15.1 12.7
Total current liabilities 179.4 165.1
Total liabilities 863.1 790.4
TOTAL EQUITY AND LIABILITIES 2,787.8 2,735.5
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > CHANGES IN EQUITY
TORM ANNUAL REPORT 2025 202
Parent Company Statement of Changes in Equity
01 January-31 December 2025
USDm
Common
shares ¹⁾
Share
premium
Treasury
shares ¹⁾
Hedging
reserves
Other
reserves ⁵⁾
Retained
profit ⁵⁾ Total
Equity as of 01 January 2024 0.9 170.2 -4.2 25.6 — 645.3 837.8
Comprehensive income for the year:
Net profit for the year — — — — — 1,307.2 1,307.2
Other comprehensive income for the year — — — -10.5 — — -10.5
Tax on other comprehensive income — — — 2.6 — — 2.6
Total comprehensive income for the year — — — -7.9 — 1,307.2 1,299.3
Capital increases 0.1 331.6 — — — — 331.7
Transaction costs capital increase — -0.6 — — — — -0.6
Capital reduction ²⁾ — -320.0 — — 320.0 — —
Share-based compensation — — — — — 30.2 30.2
Dividends paid — — — — — -553.3 -553.3
Total changes in equity 2024 0.1 11.0 — — 320.0 -523.1 -192.0
Equity as of 31 December 2024 1.0 181.2 -4.2 17.7 320.0 1,429.4 1,945.1
Comprehensive income for the year:
Net profit for the year — — — — — 137.9 137.9
Other comprehensive income for the year — — — -15.8 — — -15.8
Tax on other comprehensive income — — — 4.0 — — 4.0
Total comprehensive income for the year — — — -11.8 — 137.9 126.1
Capital increases — 19.3 — — — — 19.3
Transaction costs capital increase — -0.2 — — — — -0.2
Capital reduction ³⁾ — -180.0 — — 180.0 — —
Treasury share cancellation ⁴⁾ — — 4.2 — -4.2 — —
Share-based compensation — — — — — 34.1 34.1
Dividends paid — — — — -199.7 — -199.7
Total changes in equity 2025 — -160.9 4.2 — -23.9 34.1 -146.5
Equity as of 31 December 2025 1.0 20.3 — 5.9 296.1 1,601.4 1,924.7
1) Please refer to Note 17 to the Group consolidated financial statements for further information on treasury shares.
2) The Share premium reserve was reduced by USD 320.0m, as decided at the Annual General Meeting on 11 April 2024 and subsequently approved by the court, in order to create additional distributable reserves to support: (i) the future payment by the
Company of dividends to its shareholders; and (ii) potential share buybacks should it be desirable to do so.
3) The Share premium reserve was reduced by USD 180.0m, as decided at the Annual General Meeting on 16 April 2025 and subsequently approved by the court, in order to create additional distributable reserves to support: (i) the future payment by the
Company of dividends to its shareholders; and (ii) potential share buybacks should it be desirable to do so.
4) TORM plc cancelled 493,371 shares that were purchased in share buybacks on Nasdaq Copenhagen A/S in 2016 and 2020. Consequently, the share capital was reduced with a nominal value of, in aggregate, USD 4,933.71.
5) As a result of prior year’s non-cash intercompany transactions, TORM plc had, at 31 December 2025, distributable reserves of USD 584.8m (2024:USD 436.7m) as determined in accordance with the Companies Act 2006, which represents the amount
legally available for distribution to shareholders.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > CHANGES IN EQUITY
TORM ANNUAL REPORT 2025 203
Parent Company Cash Flow Statement
01 January-31 December 2025
USDm Note 2025 2024
Cash flow from operating activities
Net profit for the year 137.9 1,307.2
Reversals:
Reversal of depreciation and impairment losses 2.8 0.2
Reversal of other non-cash movements
17
147.3 64.2
Financial income
4
-192.3 -1,365.7
Financial expenses
4
48.5 37.9
Tax
5
6.8 -3.4
Interest received 7.3 31.8
Interest paid -45.4 -31.2
Net exchange rate gains and losses 0.1 -0.3
Repayments of intercompany trading balances — -0.1
Income taxes paid -0.2 —
Change in inventories, receivables, and payables, etc. 17 -20.5 -19.7
Net cash flow from operating activities 92.3 20.9
USDm Note 2025 2024
Cash flow from investing activities
Investment in tangible fixed assets 6 -0.1 -0.2
Loans to subsidiaries ¹⁾ -307.3 —
Repayments of loans to subsidiaries 251.7 313.1
Dividends from subsidiaries 13.4 60.0
Net cash flow from investing activities -42.3 372.9
Cash flow from financing activities
Borrowing, mortgage debt 11 335.5 419.4
Repayment/redemption, mortgage debt 11 -263.6 -182.3
Repayment/redemption, leases 11 -0.1 —
Capital increase ¹⁾ 2.3 12.5
Transaction costs capital increase -0.1 -0.6
Dividends paid -199.7 -553.3
Net cash flow from financing activities -125.7 -304.3
Net cash flow from operating, investing, and financing
activities -75.7 89.5
Cash and cash equivalents as of 01 January 90.2 0.7
Cash and cash equivalents as of 31 December 14.5 90.2
1) During 2025, capital increase amounted to USD 19.3m (2024: USD 331.7m), including a USD 17.0m (2024: USD 319.2m)
non-cash share issue in relation to subsidiaries’ acquisition of 1 vessel (2024: 19) vessels with a corresponding increase in
loans to subsidiaries. Please also refer to Note 7 for non-cash transactions on investments in subsidiaries in 2025 and
2024.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > CASH FLOW STATEMENT
TORM ANNUAL REPORT 2025 204
Notes to Parent Company Financial
Statements
Note 1 – Accounting policies - Supplementary for the parent company 206
Note 2 – Revenue from contracts with customers 207
Note 3 – Staff costs 207
Note 4 – Financial items 207
Note 5 – Tax 208
Note 6 – Capitalized dry-docking and vessel modifications 209
Note 7 – Financial assets 209
Note 8 – Inventories 209
Note 9 – Freight receivables 210
Note 10 – Other receivables 210
Note 11 – Borrowings 210
Note 12 – Other liabilities 211
Note 13 – Impairment testing 211
Note 14 – Collateral security for mortgage debt and bank loans 211
Note 15 – Guarantee commitments and contingent liabilities 211
Note 16 – Related party transactions 211
Note 17 – Cash flows 212
TORM ANNUAL REPORT 2025 205
NOTE 1 – ACCOUNTING POLICIES - SUPPLEMENTARY FOR THE PARENT COMPANY
Basis of Preparation
TORM plc is a public company limited by shares and incorporated in England and Wales. Its registered
number is 09818726, and its registered address is 4th Floor, 120 Cannon Street,
London, EC4N 6AS. The Parent Company meets the definition of a qualifying entity under Financial
Reporting Standard 100 (“FRS 100”) issued by the Financial Reporting Council. Therefore, these
financial statements were prepared in accordance with United Kingdom Generally Accepted Accounting
Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting
Standard 101 Reduced Disclosure Framework and with the provisions of the Companies Act 2006 and
additional disclosure requirements for listed companies in accordance with the Danish Financial
Statements Act.
As permitted by FRS 101, the Parent Company has taken advantage of the disclosure exemptions
available under that standard in relation to accounting standards issued but not yet effective or
implemented, share-based payment information, financial instruments, capital management,
presentation of comparative information in respect of certain assets and certain related party
transactions.
The following exemptions available under FRS 101 have been applied:
• Paragraphs 45(b) and 46 to 52 of IFRS 2, “Shared-based payment” (details of the number and
weighted-average exercise prices of share options, and how the fair value of goods or services
received was determined)
• IFRS 7 “Financial Instruments: Disclosures”
• Paragraph 91 to 99 of IFRS 13, “Fair value measurement” (disclosure of valuation techniques and
inputs used for fair value measurement of assets and liabilities)
• The following paragraphs of IAS 1 “Presentation of financial statements”
• 16 (statement of compliance with all IFRS)
• 134-136 (capital management disclosures)
• Paragraph 30 and 31 of IAS 8 “Accounting policies, changes in accounting estimates and
errors” (requirement for the disclosure of information when an entity has not applied a new IFRS
that has been issued but is not yet effective)
• Paragraph 17 and 18A of IAS 24 “Related Party Disclosures” (Key management personnel
compensation)
• The requirements in IAS 36 “Impairment of Assets” (disclosure of valuation technique and
assumptions used in determining recoverable amount)
The financial statements have been prepared on a going concern basis. Further information relating to
the going concern assumption is provided in Note 1 to the Group consolidated financial statements.
Where required, the equivalent disclosures are given in the Group's consolidated financial statements.
Key sources of estimating uncertainty disclosure are provided in the accounting policies and in relevant
notes to the Group consolidated financial statements as applicable.
Details of the Parent Company's share-based payment schemes are provided in Note 5 to the Group
consolidated financial statements.
NOTE 1 - continued
Accounting Policies
Supplemental to the accounting policies provided in Note 1 to the Group consolidated financial
statements, the following material Accounting Policy information provided below were applied to the
Parent Company’s financial statements.
Investment in Subsidiaries and Joint Ventures
Investment in subsidiaries, associated companies, and joint ventures are recognized and measured in
the financial statements of the Parent Company at cost less provision for impairment and classified as
“non-current assets”. Dividends are recognized under “Financial income”.
The carrying amount of investment in subsidiaries and joint ventures is increased to its recoverable
amount if there have been changes in the estimates used to determine the recoverable amount since
the last impairment loss was recognized.
Reversal of impairment losses on investment in subsidiaries and joint ventures is recognized in
“Impairment reversal on investment in subsidiaries”.
Critical Accounting Estimates and Judgments
Supplemental to the critical accounting estimates and judgments provided in Note 1 to the Group
consolidated financial statements, the following is considered a significant accounting estimate used in
the preparation of the Parent Company’s financial statements.
Carrying Amounts of Investments in Subsidiaries
The Management has assessed that all subsidiaries of the Parent Company are considered as one
single cash-generating unit (CGU).
The Parent Company evaluates the carrying amount of the CGU to determine if events have occurred
which would require a modification of the carrying amount. The recoverable amount of the CGU is
reviewed based on events or changes in circumstances which would indicate that the carrying amount
of the CGU might not be recoverable.
In assessing the recoverability of the CGU, the Parent Company reviews certain indicators of potential
impairment or indication of any past impairment losses that should be reversed. If an indication of
impairment or reversal of past impairment is identified, the need for recognizing an impairment loss or a
recognition of a reversal of a past impairment loss is assessed by comparing the carrying amount of
the CGU to the higher of the fair value less costs of disposal and the value in use.
The Management assesses indicators of impairment that include, but are not limited to, broker vessel
values, weighted average cost of capital, and any other adverse impacts from current economic,
environmental, and geopolitical uncertainty.
For further information regarding the underlying impairment testing of the vessels in the Group, please
refer to Note 12 to the Group consolidated financial statements.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 206
NOTE 2 – REVENUE FROM CONTRACTS WITH CUSTOMERS
USDm 2025 2024
Disaggregation of revenue
Transportation of oil products and chemicals 248.7 33.6
Bareboat and charter hire from subsidiaries 11.9 40.2
Total revenue 260.6 73.8
USDm
2025 2024
Customer contract balances
Freight receivables 45.3 23.9
Customer contract assets¹⁾ 0.2 0.3
Total 45.5 24.2
1) Recognized in prepayments.
Refer to Note 9 for further information on trade receivables. Customer contract assets primarily relate
to prepaid voyage expenses until the cargo load date. During the year, USD 0.3m was recognized
relating to customer contracts entered in 2024 (2024: USD 0.0m relating to 2023).
NOTE 3 – STAFF COSTS
The average number of employees is calculated as a full-time equivalent (FTE).
USDm 2025 2024
Total staff costs
Staff costs included in administrative expenses 12.4 9.5
Total 12.4 9.5
Staff costs comprise the following
Wages and salaries 2.3 0.8
Share-based compensation 9.4 8.3
Pension costs 0.2 0.1
Other social security costs 0.2 0.1
Other staff costs 0.3 0.2
Total 12.4 9.5
Average number of permanent employees
Land-based 13 4
Total 13 4
Total seafarers’ costs in 2025 were USD29.6m (2024: USD 4.1m), which is included in “Operating
expenses”. The cost is recharged to TORM PLC from another group undertaking as they are not
employed by TORM PLC.
Please refer to Note 5 to the Group consolidated financial statements for further information on
Executive Management and Non-Executive Board remuneration as well as share-based compensation.
NOTE 4 – FINANCIAL ITEMS
USDm 2025 2024
Financial income
Interest income from subsidiaries 5.3 30.6
Interest income from cash and cash equivalents, including
restricted cash 3.2 0.1
Dividends from subsidiaries 183.8 1,335.0
Total 192.3 1,365.7
Financial expenses
Interest expense to subsidiaries -2.1 —
Interest expenses on borrowings -41.3 -35.1
Interest expense from right-of-use assets -0.1 —
Commitment fees -3.3 -1.9
Amortization of interest rate swaps -1.3 -1.7
Ineffectiveness on interest rate swaps 0.8 1.5
Exchange rate adjustments, including loss from forward
exchange rate contracts -0.8 -0.3
Other financial expenses -0.4 -0.4
Total -48.5 -37.9
Dividends from subsidiaries in 2025 of USD 183.8m primarily related a non-cash distribution of USD
151.6m arising from the winding-up of two subsidiaries. The remaining USD 32.2m is related to both
cash and non-cash distributions from ordinary subsidiary operations.
Dividends from subsidiaries in 2024 of USD 1,335.0m primarily related to non-cash distribution of USD
1,275.0m from its subsidiary TORM A/S. This included USD 795.7m related to the transfer of share
ownership of TORM Singapore Pte Ltd with transfer price based on the market value of vessels owned
by TORM Singapore Pte Ltd. The market value was determined using an average of valuations from two
internationally acknowledged shipbrokers with appropriate qualifications and recent experience in
vessel. Another non-cash distribution of USD 479.2m was in relation to a settlement of intercompany
loan note payable to TORM A/S. This loan note was originated from transfer 15 vessels from TORM A/S
to TORM VesselCo UK Limited, with the loan principle amount also based on an average of valuations
from two the two qualified shipbrokers. TORM Plc increased its capital contribution in TORM VesselCo
UK Limited (refer to Note 6) by settling the loan note at full with TORM A/S. TORM Plc further received
cash dividends of USD 60.0m from TORM Singapore Pte Lte in 2024.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 207
NOTE 5 – TAX
The major components of income tax for the years ended 31 December 2025 and 2024 are:
USDm 2025 2024
Tax for the year
Income tax
Origination and reversal of temporary differences 6.7 -3.5
Total income tax for the year 6.7 -3.5
Tonnage tax —
Tonnage tax charge for the year 0.1 0.0
Total tonnage tax for the year 0.1 —
Total tax for the year recognized in the income statement 6.8 -3.5
The net movement in deferred tax of USD 6.7m for the year ended 31 December 2025 consists of the
reversal of the recognised deferred tax assets on account for corporate interest restriction and carry
forward of losses. TORM has unutilized corporate interest restriction (CIR) balance of USD 22.2m
(2024: USD 3.2m) and unabsorbed tax losses of USD 38.7m as on 31 December 2025 (2024: USD
37.3m). TORM has not recognised deferred tax assets on USD 60.9m (2024: USD 2.2m).
In 2024, TORM plc established a new UK vessel-owning company. The UK-owned vessels are chartered
on bareboat contracts to TORM plc, which charters out the vessels externally. TORM plc has elected
and applied to enter into the UK tonnage tax regime in October 2024.
NOTE 5 – continued
Reconciliation of tax charge
USDm 2025 2024
Accounting profit before income tax 144.7 1,303.7
Adjustment of income:
Dividend distribution -183.8 -1,335.0
Legal and professional fees 1.8 1.5
Non-chargable shipping activities -10.6 7.7
Other non-deductible expenses for tax purposes 10.9 8.8
Corporate interest restriction 22.9 4.6
Capital allowances -0.2 -0.2
Adjusted taxable loss -14.3 -8.9
At effective UK income tax rate of 25% 3.6 2.2
Unrecognized DTA -3.6 —
Current year recognized DTA — 2.2
Recognition of prior year DTA — 1.3
Reversal of prior year DTA -6.7 —
Income tax recognized in the Income Statement -6.7 3.5
Deferred taxes
USDm 2025 2024
Deferred tax asset related to Corporate Interest Restriction 1.0 1.7
Deferred tax asset related to trading losses 1.0 6.9
Deferred tax assets before offset 2.0 8.6
Deferred tax liabilities offset -2.0 -5.9
Deferred tax assets in the balance sheet
— 2.7
USDm 2025 2024
Deferred tax liabilities arising from changes in equity 2.0 5.9
Deferred tax liabilities before offset 2.0 5.9
Offset against deferred tax assets -2.0 -5.9
Deferred tax liabilities in the balance sheet
— —
Deferred tax assets are recognized to the extent that the realization of the relaxed tax benefit through
future taxable profits is probable.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 208
NOTE 5 – continued
All deferred tax movements arise from the origination and reversal of temporary differences.
Deferred tax at the balance sheet date have been measured using the appropriate enacted tax rates
and are reflected in these financial statements.
Pillar Two Tax Effects
Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions in which the
Group operates. Under the legislation, the parent company will be required to pay, in UK, top-up tax on
profits of its subsidiaries that are taxed at an effective tax rate of less than 15%. The main jurisdictions
in which exposures to this tax may exist include Denmark, Singapore and the US.
As the majority of these companies’ revenue consists of international shipping income, it is assessed
that this income will be excluded from the GloBE income with reference to the shipping carve out
described in Article 3.3.
TORM has applied the exception in IAS 12 'Income Taxes' to recognizing and disclosing information
about deferred tax assets and liabilities related to Pillar Two income taxes.
Based on our fiscal year for 2025, the Group has prepared a preliminary Transitional Country-by-
Country Reporting (CbCR) Safe Harbour assessment concluding that we expect to be eligible for the
Transitional CbCR Safe Harbour in a majority of jurisdictions in which we are present. As of 31
December 2025, the calculated top-up tax does not have a material impact on our financial result.
NOTE 6 – CAPITALIZED DRY-DOCKING AND VESSEL MODIFICATIONS
USDm 2025 2024
CAPITALIZED DRY-DOCKING AND VESSEL MODIFICATIONS
Cost:
Balance as of 01 January 5.4 —
Additions 20.7 5.4
Disposals -0.1 —
Balance as of 31 December 26.0 5.4
Depreciation:
Balance as of 01 January 0.1 —
Disposals -0.1 —
Depreciation for the year 2.4 0.1
Balance as of 31 December 2.4 0.1
Carrying amount as of 31 December 23.6 5.3
Included in the carrying amount for “Capitalized dry-docking and vessel modifications” are capitalized
dry-docking costs in the amount of USD 15.6m (2024: USD 4.3m).
The additions of USD 20.7m (2024: USD 5.4m) of capitalized dry-docking and vessel modifications
include non-cash expenditures of USD 18.5m (2024: USD 4.4m), which are paid by a subsidiary.
NOTE 7 – FINANCIAL ASSETS
USDm 2025 2024
INVESTMENTS IN SUBSIDIARIES
Cost:
Balance as of 01 January 2,441.9 1,009.1
Additions — 1,453.4
Capital decreases in subsidiaries -66.8 -42.4
Capital increases related to share-based payments 23.9 21.8
Balance as of 31 December 2,399.0 2,441.9
Carrying amount as of 31 December 2,399.0 2,441.9
Capital decreases in subsidiaries during 2025 of USD 66.8m is recognized in connection to the
dissolvement of VesselCo 9 Pte Ltd and VesselCo 12 Pte Ltd, which is expected to finalize during 2026.
NOTE 8 – INVENTORIES
USDm 2025 2024
Bunkers 6.5 5.7
Lubeoil 2.7 1.4
EU Emission Allowances 0.1 —
Balance as of 31 December 9.3 7.1
During 2025, bunker inventories of USD 47.7m (2024:USD 7.7m) were recognized as an expense in Port
expenses, bunkers and commissions.
During 2025, lubeoil inventories of USD 1.6m (2024: USD 0.2m) were recognized as an expense in
Operating expenses.
During 2025, EU Emission Allowance inventories of USD 1.7m (2024: USD 0.1m) were recognized as an
expense in Port expenses, bunkers and commissions.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 209
NOTE 9 – FREIGHT RECEIVABLES
USDm 2025 2024
Gross freight receivables
Not due 22.1 15.0
Due < 30 days 9.1 6.3
Due between 30 - 180 days 14.5 2.6
Total gross 45.7 23.9
Allowance for expected credit loss 0.4 —
Total net 45.3 23.9
The Management makes allowance for expected credit loss based on “the simplified approach”
according to IFRS 9 to provide for expected credit losses, which permits the use of the lifetime
expected loss provision for all freight receivables. Expected credit loss for receivables overdue more
than 180 days is 25%-100%, depending on the category of the receivable. Expected credit loss for
receivables overdue more than one year is 100%.
Movements in provisions for impairment of freight receivables during the year are as follows:
USDm 2025 2024
Allowance for expected credit loss
Balance as of 01 January — —
Provisions for the year 0.4 —
Balance as of 31 December 0.4 —
Allowance for expected credit loss of trade receivables has been recognized in the income statement
under “Port expenses, bunkers and commissions”.
Allowance for expected credit loss of freight receivables is calculated using an aging factor as well as
specific customer knowledge and is based on a provision matrix on days past due.
NOTE 10 – OTHER RECEIVABLES
USDm
2025 2024
Derivative financial instruments 8.4 24.7
Other 1.1 0.2
Balance as of 31 December 9.5 24.9
NOTE 11 – BORROWINGS
USDm
2025 2024
Syndicate Facility — 160.0
Syndicate Facility 2025 248.1 —
Bond Facility 200.0 200.0
Credit Agricole Facility 68.6 —
DSF Facility 107.6 123.8
DSF Facility 2 76.0 92.0
DSF Facility 3 27.4 29.8
HCOB Facility 43.8 87.5
ING 44.8 51.4
Total borrowings 816.3 744.5
Borrowing costs -10.7 -10.9
Right-of-use lease liabilities 1.0 —
Total 806.6 733.6
Hereof non-current 683.7 625.3
Hereof current 122.9 108.3
Please refer to Note 2 and Note 19 to the consolidated financial statements for further information on
the facilities.
In January 2024 the Parent Company issued a senior unsecured bond of USD 200m, which was
successfully listed on the Oslo Stock Exchange in June 2024.
The following table summarizes the reconciliation of liabilities arising from financing activities:
Cash movements
Non-cash
movements
USDm
Opening
balance
as of 01
January 2025 Borrowings Repayments Other changes
End balance
as of 31
December
2025
Borrowings 733.6 335.5 -263.7 1.2 806.6
Total 733.6 335.5 -263.7 1.2 806.6
Cash movements
Non-cash
movements
USDm
Opening
balance
as of 01
January 2024 Borrowings Repayments Other changes
End balance
as of 31
December
2024
Borrowings 499.0 419.4 -182.3 -2.5 733.6
Total 499.0 419.4 -182.3 -2.5 733.6
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 210
NOTE 12 – OTHER LIABILITIES
USDm
2025 2024
Accrued operating expenses 3.3 1.1
Accrued interest 10.6 10.7
Accrued administration expenses 0.6 0.8
EU Emission Allowance 0.5 0.1
Derivative financial instruments 0.1 —
Balance as of 31 December 15.1 12.7
NOTE 13 – IMPAIRMENT TESTING
As of 31 December 2025, the Management has assessed that all subsidiaries of TORM plc are
considered as one single CGU. The approach is similar to the approach applied as of 31 December
2024.
As of 31 December 2025, the Management has assessed indicators of impairment for the CGU that
include, but are not limited to, broker vessel values, weighted average cost of capital, any other adverse
impacts from current economic, environmental, and geopolitical uncertainty as well as the carrying
amount of the net assets against the market capitalization. The indicators are similar to the ones used
in the assessment as of 31 December 2024.
Based on this assessment, the Management did not determine the recoverable amount of the CGU as
of 31 December 2025 as no indicators were identified. As of 31 December 2024, The Management
came to the same conclusion.
NOTE 14 – COLLATERAL SECURITY FOR MORTGAGE DEBT AND BANK LOANS
The vessels owned by subsidiaries of the Parent Company which have been provided as security for
TORM’s debt amounted to USD 645.0m as of 31 December 2025 (2024: USD 544.5m).
NOTE 15 – GUARANTEE COMMITMENTS AND CONTINGENT LIABILITIES
The Parent Company is guarantor for a loan amounting to USD 28.8m (2024: USD 31.8m) established in
the subsidiary TORM A/S.
As part of sale and leaseback transactions made by a subsidiary, the Parent Company issued a
guarantee to the third party in relation to future lease payments to be made by the subsidiary, which
are expected to total approximately USD 157.5m (2024: USD 456.6m).
NOTE 16 – RELATED PARTY TRANSACTIONS
As of 31 December 2025 TORM’s ultimate controlling party is Brookfield Oaktree Holdings, LLC, a
limited liability company incorporated in the USA. The immediate controlling shareholder is OCM Njord
Holdings S.à.r.l. (Njord Luxco).
After the end of the year, subsequent changes were made to the B- and C-shares. Refer to Note 2 in
the Group consolidated financial statements for description of subsequent events
During the year the following transactions with related parties have occurred:
USDm 2025 2024
Transactions with subsidiaries
Time charter hire income 5.5 0.8
Bareboat hire income 6.4 39.4
Bareboat hire expense 94.8 62.0
Management fee income 3.0 0.4
Management fee expense 5.8 1.8
The Parent Company has loans with a total outstanding balance of USD 229.0m as at 31 December
2025 (2024: USD 134.0m). It primarily consist of two unsecured loans to two subsidiaries (2024: two)
maturing in 2026 (subsequent to year end maturity extended to 2030) and 2027 respectively (2024:
2026 and 2028 respectively).The loans carry interest rate in accordance with SOFR compounded in
arrears plus a margin of 1.75% and 1.85% (2024: 1.75% and 1.85%) .
Please refer to Parent Company Cash Flow Statement for non-cash share issue in relation to
subsidiaries’ acquisition of vessels.
Please refer to Note 4 to the Parent Company financial statements for interest income from
subsidiaries and received dividends from subsidiaries.
As part of the business model in TORM, the Parent Company has bareboat agreements (short term
leases) with subsidiaries, which are nullified on a continuing basis through dividends, capital reductions,
etc. Consequently, the intercompany liability of USD 33.7m at 31 December 2025 (2024: USD 39.4m)
towards subsidiaries is expected to be settled during 2026.
There have been no or limited transactions with related parties during the financial year other than the
transactions disclosed above.
Please refer to Note 26 in the Group consolidated financial statements for further information about
transactions with controlling shareholder and to Note 5 in the Group consolidated financial statements
for further information about the remuneration to the Executive Director.
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 211
NOTE 17 – CASH FLOWS
USDm 2025 2024
Reversal of other non-cash movements:
Share-based payments 10.2 8.4
Bareboat hire expense 94.8 62.0
Bareboat and charter hire income -11.9 -13.9
Operating expenses 49.9 6.5
Management fees 2.8 1.4
Other adjustments 1.5 -0.2
Total 147.3 64.2
USDm 2025 2024
Change in inventories, receivables and payables
Change in inventories -1.2 -0.6
Change in receivables -22.3 -24.1
Change in prepayments -0.2 -0.3
Change in trade payables and other liabilities 3.2 5.3
Total -20.5 -19.7
FINANCIAL STATEMENTS > PARENT COMPANY FINANCIAL STATEMENTS > NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
TORM ANNUAL REPORT 2025 212
Other
Independent Auditor's Limited Assurance Report on the
Sustainability Statement
219
TORM Fleet Overview 221
Glossary 223
Alternative Performance Measures 225
TORM ANNUAL REPORT 2025 213
Independent Auditor’s Report to the Members of TORM plc
Report on the Audit of the Financial Statements
TORM ANNUAL REPORT 2025 214
TORM ANNUAL REPORT 2025 215
Risk Our Response to the Risk
VESSEL IMPAIRMENT INDICATORS ASSESSMENT (GROUP)
CARRYING VALUE AS AT 31 DECEMBER 2025 TOTALLED $2,792M (2024: $2,827M)
Refer to the Audit Committee Report (page 116); Accounting policies (page 162 and 176) and Note 12
of the Consolidated Financial Statements (page 179-180).
The Group assesses impairment indicators at each reporting date or whenever events or changes in
circumstances would indicate that the carrying amounts of its vessels might not be recoverable in
accordance with IAS 36 - Impairment of Assets. The Group prepares an impairment indicator
assessment at the cash generating unit (CGU) level, which has been determined as LR1, LR2 and MR
vessels (the Tanker Fleet) as they are operated collectively, are largely interchangeable and the cash
flows generated by them are interdependent from other vessels. In assessing vessel impairment
indicators, the Group monitors the fair value of the vessels, which was calculated as the average of
two valuations prepared by independent shipbrokers. Based on the assessment, the Group concluded
that the no vessel impairment indicators required the Group to prepare an impairment test as of 31
December 2025.
Auditing the Group’s vessel impairment indicator assessment was complex due to the significant
judgement required by management in determining the CGU and determining whether impairment
indicators required the Group to prepare an impairment test. The vessel impairment indicator with
significant judgement was management’s assessment of the fair value of the vessels using
independent shipbroker valuations, which use a combination of vessel specific inputs such as size,
yard, and age of the vessels, and assumptions based on market data, including recent comparable
vessel transactions.
• We obtained an understanding, evaluated the design, and tested the operating effectiveness of
the controls over the Group’s impairment assessment process, including controls over the
identification of CGUs and review of the vessels’ fair value.
• We performed audit procedures on the impairment indicator assessment that included, among
others, re-evaluating management’s CGU determination by assessing their analysis in respect of
the smallest Group of assets that generate largely independent cash flows.
• We inspected evidence used in management’s determination of the collective operation and
homogenous nature of the Tanker Fleet in relation to the CGU determination.
• We evaluated the determination of the fair value of the vessels by comparing them to the average
of two valuations prepared by independent shipbrokers.
• We performed inquiries with the independent shipbrokers regarding the valuation methodology
applied and input data used and evaluated their competence, capabilities and objectivity.
• We involved our valuation specialists to assist with our audit procedures specific to the valuation
of the Tanker Fleet and evaluating the methodology applied by management’s specialists.
• We tested the input data used for the valuation of the vessels in the Tanker Fleet by comparing
vessel specific inputs with vessel records and supporting documentation as well as evidence
obtained in other areas of the audit.
• We further performed a retrospective comparison of historical sales prices of vessels with the
independent broker valuations near the time of disposal and compared the valuations to recent
market data for comparable vessels.
• We assessed the adequacy of disclosures in notes 1 and 12, including the impact from climate
changes to the consolidated financial statements in accordance with IAS 36 - Impairment of
Assets.
Key Observations Communicated to the Audit Committee
Based on our audit procedures performed, we have concluded that management’s conclusion that there are no vessel impairment indicators at 31 December 2025 is reasonable and has been appropriately
disclosed in the Group financial statements.
How we scoped our audit to respond to the risk
The primary team performed audit procedures over 100% of the carrying value of vessels recorded by the Group.
Risk Our Response to the Risk
CARRYING VALUE OF INVESTMENTS IN SUBSIDIARIES (PARENT)
CARRYING VALUE AS AT 31 DECEMBER 2025 TOTALLED $2,399M (2024: $2,442M)
Refer to the accounting policies (page 206) and Notes 7 and 13 of the Parent Company Financial
Statements (page 209 and 211).
Management is required to assess whether indicators of impairment exist in relation to investments in
subsidiaries.
There is a risk of inappropriate assessment due to the significant levels of judgement involved in the
determination of cash-generating units (‘CGUs’) to be considered in the assessment and determining
whether indicators of impairment exist.
• We obtained an understanding and evaluated the design of the controls over the Parent
Company’s impairment assessment process, including identification of CGUs.
• We performed audit procedures on the investment in subsidiaries impairment indicator
assessment that included, among others, re-evaluating management’s CGU determination by
assessing their analysis in respect of the smallest Group of assets that generate largely
independent cash flows.
• We tested completeness of management’s impairment indicator assessment by considering
contrary evidence which may indicate impairment of the investments, including the results of our
audit procedures over the valuation of vessels; and
• We assessed the adequacy of disclosures in in the notes 1 and 13 the financial statements of the
Parent Company in accordance with IAS 36 - Impairment of Assets.
Key Observations Communicated to the Audit Committee
Based on our audit procedures performed, we have concluded that management’s conclusion that there are no impairment indicators at 31 December 2025 is reasonable and has been appropriately disclosed in
the Parent Company financial statements.
How we scoped our audit to respond to the risk
The primary team performed audit procedures over 100% of the Parent Company’s investments in subsidiaries balance.
TORM ANNUAL REPORT 2025 216
Our Application of Materiality
We apply the concept of materiality in planning and performing the
audit, in evaluating the effect of identified misstatements on the
audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or
in the aggregate, could reasonably be expected to influence the
economic decisions of the users of the financial statements.
Materiality provides a basis for determining the nature and extent
of our audit procedures.
Overall Materiality
We determine materiality for the Group to be $22.0m (2024:
$22.0m), which is 0.7% of Total assets (2024: 2.0% of EBITDA).
Our key criterion in determining overall materiality remains our
perception of the needs of the Group’s stakeholders. We consider
which earnings, activity or capital-based measure aligns best with
the expectations of the users of the financial statements. In doing
so, we apply a ‘reasonable investor perspective’, which reflects our
understanding of the common financial information needs of the
members as a Group. For the 2025 audit, we consider Total assets
(2024: EBITDA), which includes the Group's tanker fleet, as the key
focus of the Group’s stakeholders.
In addition to the overall group materiality, and in line with our risk
assessment, we have applied a lower materiality threshold of
$14.8m in testing the significant accounts which impact Profit
before tax.
We determined materiality for the Parent Company to be $19.0m
(2024: $13.0m), which is 0.7% of Total assets (2024: 0.5% of Total
assets). For our testing of Parent Company balances that are
consolidated in the Group financial statements, an allocation of
Group performance materiality was used.
Performance Materiality
The application of materiality at the individual account or balance
level. It is set at an amount to reduce to an appropriately low level
the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with our
assessment of the Group’s overall control environment, our
judgement was that performance materiality was 50% (2025:
50%) of our planning materiality, namely $11.0m (2024: $11.0m).
Audit work was undertaken at component locations for the
purpose of responding to the assessed risks of material
misstatement of the Group financial statements. The performance
materiality set for each component is based on the relative scale
and risk of the component to the Group as a whole and our
assessment of the risk of misstatement at that component. In the
current year, the range of performance materiality allocated to
components was $2.2m to $8.3m.
Reporting Threshold
An amount below which identified misstatements are considered
as being clearly trivial.
We agreed with the Audit Committee that we would report to them
all uncorrected audit differences in excess of $1.1m (2024: $1.1m),
which is set at 5% of planning materiality, as well as differences
below that threshold that, in our view, warranted reporting on
qualitative grounds.
We evaluate any uncorrected misstatements against both the
quantitative measures of materiality discussed above and in light
of other relevant qualitative considerations in forming our opinion.
Other Information
The other information comprises the information included in the
annual report, set out on pages 5-151, other than the financial
statements and our auditor’s report thereon. The directors are
responsible for the other information contained within the annual
report.
Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated in
this report, we do not express any form of assurance conclusion
thereon.
Our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the
course of the audit or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent
material misstatements, we are required to determine whether this
gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude
that there is a material misstatement of the other information, we
are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies
Act 2006
In our opinion, the part of the directors’ remuneration report to be
audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of the
audit:
• the information given in the strategic report and the directors’
report for the financial year for which the financial statements
are prepared is consistent with the financial statements; and
• the strategic report and directors’ report have been prepared
in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and
the Parent Company and its environment obtained in the course of
the audit, we have not identified material misstatements in the
strategic report or the directors’ report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
• adequate accounting records have not been kept by the
Parent Company, or returns adequate for our audit have not
been received from branches not visited by us; or
• the Parent Company financial statements and the part of the
directors’ remuneration report to be audited are not in
agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law
are not made; or
• we have not received all the information and explanations we
require for our audit
Corporate Governance Statement
ISAs (UK) require us to review the Directors' statement in relation
to going concern and longer-term viability and that of the
Corporate Governance Statement relating to the Company’s
compliance with the provisions of the UK Corporate Governance
Code specified for our review.
Based on the work undertaken as part of our audit, we are required
to report if each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements or our knowledge obtained during the audit:
• Directors’ statement with regards to the appropriateness of
adopting the going concern basis of accounting and any
material uncertainties identified set out on page 27 and 149;
• Directors’ explanation as to its assessment of the company’s
prospects, the period this assessment covers and why the
period is appropriate set out on page 27;
• Director’s statement on whether it has a reasonable
expectation that the Group will be able to continue in
operation and meets its liabilities set out on page 27;
• Directors’ statement on fair, balanced and understandable set
out on page 150;
• Board’s confirmation that it has carried out a robust
assessment of the emerging and principal risks set out on
page 14;
• The section of the annual report that describes the review of
effectiveness of risk management and internal control
systems set out on page 14-18, 117 and 120; and
• The section describing the work of the audit committee set out
on page 115-118.
TORM ANNUAL REPORT 2025 217
Use of Our Report
This report is made solely to the company’s members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state
to the company’s members those matters we are required to state
to them in an auditor’s report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the
company’s members as a body, for our audit work, for this report,
or for the opinions we have formed.
for and on behalf of Ernst & Young LLP , Statutory Auditor
TORM ANNUAL REPORT 2025 218
FINANCIAL STATEMENTS > OTHER > ESG AUDIT REPORT
TORM ANNUAL REPORT 2025 219
FINANCIAL STATEMENTS > OTHER > ESG AUDIT REPORT
TORM ANNUAL REPORT 2025 220
TORM Fleet Overview
As of 31 December 2025
Vessel
type
Vessel
class Vessel DWT Built Ownership
Carrying value
(USDm)
Tanker LR2 TORM GABRIELLA 119,456 2010 100 % 46¹⁾
Tanker LR2 TORM GANGA 119,456 2010 100 % 45¹⁾
Tanker
LR2 TORM GAURI 119,456 2010 100 % 34
Tanker LR2 TORM GEMMA 119,456 2012 100 % 49¹⁾
Tanker LR2 TORM GENESIS 119,456 2011 100 % 45¹⁾
Tanker LR2 TORM GITTE 119,456 2010 100 % 45¹⁾
Tanker LR2 TORM GLORIA 119,456 2011 100 % 51¹⁾
Tanker LR2 TORM GRACE 119,456 2012 100 % 47¹⁾
Tanker LR2 TORM GWENDOLYN 119,456 2010 100 % 45¹⁾
Tanker LR2 TORM GWYNETH 119,456 2010 100 % 45¹⁾
Tanker LR2 TORM HANNAH 109,999 2016 100 % 37
Tanker LR2 TORM HELLERUP 114,000 2018 100 % 42
Tanker LR2 TORM HELENE 114,000 2021 100 % 44
Tanker LR2 TORM HERMIA 114,000 2018 100 % 41
Tanker LR2 TORM HERDIS 114,000 2018 100 % 39
Tanker LR2 TORM HILDE 114,000 2018 100 % 42
Tanker LR2 TORM HOUSTON 114,000 2022 100 % 44
Tanker LR2 TORM KIARA 114,445 2015 100 % 34
Tanker LR2 TORM KIRSTEN 114,445 2015 100 % 34
Tanker LR2 TORM KRISTINA 114,323 2015 100 % 35
Tanker LR2 TORM MAREN²⁾ 109,672 2008 100 % 24
Tanker LR1 TORM VENTURE 73,700 2007 100 % 17¹⁾
Tanker LR1 TORM ELISE 75,000 2020 100 % 34
Tanker LR1 TORM ELIZABETH 75,000 2020 100 % 34
Tanker LR1 TORM EVELYN 74,606 2011 100 % 29¹⁾
Tanker LR1 TORM EVOLVE 74,554 2011 100 % 28¹⁾
Tanker LR1 TORM EVA 74,552 2011 100 % 29¹⁾
Tanker LR1 TORM EMMA 75,000 2012 100 % 30¹⁾
Tanker LR1 TORM EMILIE 75,013 2013 100 % 31¹⁾
Tanker LR1 TORM INTEGRITY 73,800 2013 100 % 33¹⁾
Tanker LR1 TORM INNOVATION 73,847 2013 100 % 33¹⁾
Vessel
type
Vessel
class Vessel DWT Built Ownership
Carrying value
(USDm)
Tanker MR TORM AGNES 49,999 2011 100 % 19
Tanker MR TORM AGNETE 49,999 2010 100 % 20¹⁾
Tanker MR TORM ALEXANDRA 49,999 2010 100 % 20
Tanker MR TORM ALICE 49,999 2010 100 % 18
Tanker MR TORM ALLEGRO 46,184 2012 100 % 20
Tanker MR TORM ALMENA 49,999 2010 100 % 18
Tanker MR TORM AMALIE 49,999 2011 100 % 18
Tanker MR TORM AMORINA 46,184 2012 100 % 18
Tanker MR TORM ANABEL 49,999 2012 100 % 21
Tanker MR TORM ARAWA 49,999 2012 100 % 22
Tanker MR TORM ASLAUG 49,999 2010 100 % 17
Tanker MR TORM ASTRID 49,999 2012 100 % 22
Tanker MR TORM ATLANTIC 49,999 2010 100 % 19
Tanker MR TORM AUSTRALIA 51,737 2011 100 % 19
Tanker MR TORM CAVATINA 46,200 2010 100 % 17
Tanker MR TORM CORRIDO 46,156 2011 100 % 17
Tanker MR TORM DIWATA 49,746 2014 100 % 42¹⁾
Tanker MR TORM INDIA 49,999 2010 100 % 16
Tanker MR TORM LAURA 49,999 2008 100 % 15
Tanker MR TORM LEADER 46,070 2009 100 % 15
Tanker MR TORM LENE 49,999 2008 100 % 15
Tanker MR TORM LILLY 49,999 2009 100 % 17
Tanker MR TORM LOTTE 49,999 2009 100 % 16
Tanker MR TORM LOUISE 49,999 2009 100 % 17
Tanker MR TORM MALAYSIA 51,737 2011 100 % 19
Tanker MR TORM NEW ZEALAND 51,737 2011 100 % 17
Tanker MR TORM BIRGITTE 49,995 2013 100 % 31¹⁾
Tanker MR TORM BELIS 49,995 2013 100 % 31¹⁾
Tanker MR TORM BEATRICE 49,995 2013 100 % 31¹⁾
Tanker MR TORM PHILIPPINES 49,999 2010 100 % 17
Tanker MR TORM SINGAPORE 51,737 2011 100 % 20
FINANCIAL STATEMENTS > OTHER > ESG AUDIT REPORT
TORM ANNUAL REPORT 2025 221
TORM Fleet Overview
As of 31 December 2025
Vessel
type
Vessel
class Vessel DWT Built Ownership
Carrying value
(USDm)
Tanker MR TORM SOLUTION 49,999 2019 100 % 28
Tanker MR TORM SOVEREIGN 49,999 2017 100 % 25
Tanker MR TORM SPLENDID 49,999 2020 100 % 28
Tanker MR TORM STELLAR 49,999 2020 100 % 28
Tanker MR TORM STRENGTH 49,999 2019 100 % 28
Tanker MR TORM STRONG 49,999 2019 100 % 28
Tanker MR TORM SUBLIME 49,999 2019 100 % 27
Tanker MR TORM SUCCESS 49,999 2019 100 % 27
Tanker MR TORM SUPREME 49,999 2017 100 % 23
Tanker MR TORM THOR 49,842 2015 100 % 26
Tanker MR TORM THUNDER 49,842 2015 100 % 24
Tanker MR TORM TIMOTHY 49,842 2015 100 % 26
Tanker MR TORM TITAN 49,842 2016 100 % 27
Tanker MR TORM TORINO 49,842 2016 100 % 27
Tanker MR TORM TROILUS 49,842 2016 100 % 25
Tanker MR TORM DANICA 49,999 2015 100 % 38¹⁾
Tanker MR TORM DENISE 49,999 2015 100 % 39¹⁾
Tanker MR TORM DAGMAR 49,999 2015 100 % 39¹⁾
Tanker MR TORM DIANA 49,999 2016 100 % 40¹⁾
Tanker MR TORM DURGA 49,680 2014 100 % 42¹⁾
Tanker MR TORM DAMINI 49,746 2014 100 % 42¹⁾
Tanker MR TORM DORIS 49,680 2015 100 % 45¹⁾
Tanker MR TORM DAGNY 49,635 2015 100 % 45¹⁾
Tanker MR TORM DEBORAH 49,680 2015 100 % 45¹⁾
Tanker MR TORM DAPHNE 49,746 2015 100 % 46¹⁾
Tanker MR TORM DULCE 49,680 2014 100 % 42¹⁾
Tanker MR TORM DAVAO 49,990 2014 100 % 32
Tanker MR TORM DELHI 49,990 2014 100 % 32
Tanker MR TORM DOVER 49,990 2014 100 % 32
Tanker MR TORM DUBAI 49,990 2014 100 % 32
Tanker MR TORM FREEDOM 49,683 2017 100 % 35
1) Indicates vessels for which TORM believes that, as of 31 December 2025, the basic charter-free market value is lower
than the vessel's carrying amount.
2) Indicates that the vessels are assets held-for-sale
FINANCIAL STATEMENTS > OTHER > ESG AUDIT REPORT
TORM ANNUAL REPORT 2025 222
Glossary
Available earning days: A measure of unfixed operating days
available for generating earnings.
BB: Bareboat: A form of charter arrangement where the charterer is
responsible for all costs and risks in connection with the operation
of the vessel.
Backwardation: A situation in which the spot price of a commodity
is higher than the forward price. The opposite is known as contango.
Bunker hedge: A forward agreement used to reduce a company’s
exposure to fluctuating bunker costs.
Bunkers: Fuel with which to run a vessel’s engines.
CAPEX: Capital expenditure.
Charter-in and leaseback days: A measure of operating days
available for generating earnings from vessels that are not owned
by the Company.
Charter party: A lease or freight agreement between a shipowner
and a charterer for a longer period of time or for a single voyage.
Classification society: Independent organization that ensures
through verification of design, construction, building process, and
operation of vessels that the vessels at all times meet a long list of
requirements to seaworthiness, etc. If the vessels do not meet
these requirements, insuring and mortgaging the vessel will
typically not be possible.
COA: Contract of Affreightment. A contract that involves a number
of consecutive cargos at previously agreed freight rates.
Coating: The internal coatings applied to the tanks of a product
tanker enabling the vessel to load refined oil products.
Commercial management: An agreement to manage a vessel’s
commercial operations for the account and risk of the shipowner.
Coverage: A measure of Covered days divided by Earning days.
Covered days: A measure of fixed operating days.
CSRD: Corporate Sustainability Reporting Directive
Demurrage: A charge against the charterer of a vessel for delaying
the vessel beyond the allowed free time. The demurrage rate will
typically be at a level equal to the earnings in USD/day for the
voyage.
DKK: Danish kroner.
Dwt: Deadweight ton. The cargo carrying capacity of a vessel.
EBIT/Operating profit: Earnings Before Interest
and Tax.
Earning days: A measure of operating days available for generating
earnings.
ESG: Environment, Social, and Governance.
ESRS: European Sustainability Reporting Standards
FFA: Forward freight agreement. A financial derivative instrument
enabling freight to be hedged forward at a fixed price.
Handysize: A specific class of product tankers with a cargo carrying
capacity of 20,000–40,000 dwt.
IAS: International Accounting Standards.
IFRS: IFRS Accounting Standards issued by the International
Accounting Standards Board.
IMO: International Maritime Organization.
KPI: Key Performance Indicator. A measure of performance used to
define and evaluate how the Company is making progress towards
its long-term organizational goals.
Loan-to-value (LTV): A measure of notional debt divided by broker
values of the encumbered vessels.
LR1: Long Range 1. A specific class of product tankers with a cargo
carrying capacity of 60,000–80,000 dwt.
LR2: Long Range 2. A specific class of product tankers with a cargo
carrying capacity of 80,000–110,000 dwt.
LTAF: Lost Time Accident Frequency. Work-related personal injuries
that result in more than one day off work per million hours of work.
MR: Medium Range. A specific class of product tankers with a cargo
carrying capacity of 40,000–60,000 dwt.
MT: Metric ton.
Oaktree: Oaktree Capital Management, L.P.
Oil major: One of the world’s largest publicly owned oil and gas
companies. Examples of oil majors are BP, Chevron, ExxonMobil,
Shell and Total.
OPEC: Organization of the Petroleum Exporting Countries.
Owned days: A measure of operating days available for generating
earnings from vessels that are owned by the Company.
P&I club: Protection & Indemnity club.
Product tanker: A vessel suitable for carrying clean petroleum
products such as gasoline, jet fuel, and naphtha.
Spot market: Market in which vessels are contracted for a single
voyage for near-term delivery.
TC: Time charter: An agreement covering the chartering out of a
vessel to an end user for a defined period of time where the owner
is responsible for crewing the vessel, but the charterer must pay
port costs and bunkers.
Technical management: An agreement to manage a vessel’s
technical operations and crew for the account and risk of the
shipowner.
Ton-mile: A unit of freight transportation equivalent to a ton of
freight moved one mile.
UN Global Compact: The United Nation’s social charter for
enterprises, etc.
Vetting: An audit of the safety and performance status of a tanker
vessel made by oil majors.
FINANCIAL STATEMENTS > OTHER > GLOSSARY
TORM ANNUAL REPORT 2025 223
Glossary
Key Financial Figures
TCE per day =
TCE excluding unrealized gains/losses on derivatives
Available earning days
Gross profit % =
Gross profit
Revenue
EBITDA % =
EBITDA
Revenue
Operating profit % =
Operating profit (EBIT)
Revenue
Return on Equity (RoE) % =
Net profit/(loss) for the year
Average equity
Return on Invested Capital
(ROiC) %
=
Operating profit less tax
Average invested capital
Equity ratio =
Equity
Total assets
Earnings per share, EPS =
Net profit/(loss) for the year
Average number of shares
Diluted earnings/(loss) per share, EPS =
Net profit/(loss) for the year
Average number of shares less average number of treasury shares
FINANCIAL STATEMENTS > OTHER > GLOSSARY
TORM ANNUAL REPORT 2025 224
Glossary
Alternative Performance Measures
Group
Throughout the annual report, several alternative performance measures (APMs) are used. The
following APMs relate to the Group.
Net profit/(loss) for the year excluding non-recurrent items: Net profit excluding impairment is net
profit less impairment and reversals of impairment generated from impairment testing during the year
(please refer to Note 12). TORM reports net profit excluding impairment because we believe it provides
additional meaningful information to investors regarding the operational performance excluding
fluctuations in the valuation of fixed assets. The APM replaces “Net profit/(loss) for the year”
excluding impairment as it is more relevant and provides more useful information.
USDm 2025 2024 2023
Reconciliation to net profit for the year
Net profit/(loss) for the year 286.0 611.5 648.0
Profit from sale of vessels -19.0 -51.3 -50.4
Provisions — — -6.5
Expense of capitalized bank fees at refinancing 6.8 0.5 3.5
Termination of finance leases 0.2 — 1.3
Net profit for the year ex. non-recurrent items 274.0 560.7 595.9
Gross profit: TORM defines Gross profit, a performance measure, as revenue less port expenses,
bunkers and commissions, and other cost of goods sold, charter hire and operating expenses. TORM
reports Gross profit because we believe it provides additional meaningful information to investors, as
Gross profit measures the net earnings from core activities. Gross profit is calculated as follows:
USDm 2025 2024 2023
Computation of gross profit
Revenue 1,339.5 1,559.2 1,520.4
Port expenses, bunkers, commissions, and other cost of
goods and services sold -421.6 -418.5 -430.3
Operating expenses -252.4 -245.1 -216.0
Gross profit 665.5 895.6 874.1
Return on Invested Capital (ROIC): TORM defines ROIC as earnings before interest and tax (EBIT) less
tax, divided by the average invested capital for the period. Invested capital is defined below.
ROIC expresses the returns generated on capital invested in TORM. The progression of ROIC is used
by TORM to measure progress against our long-term value creation goals outlined to investors. ROIC is
calculated as follows:
USDm 2025 2024 2023
Reconciliation to operating profit (EBIT)
Operating profit (EBIT) 356.3 658.8 698.6
Tax -9.2 2.0 -4.0
EBIT less tax 347.1 660.8 694.6
Invested capital, opening balance 3,005.4 2,425.5 2,142.3
Invested capital, ending balance 3,037.8 3,005.4 2,425.5
Average invested capital for the year 3,021.6 2,715.5 2,283.9
Return on Invested Capital (ROIC) 11.5 % 24.3 % 30.4 %
FINANCIAL STATEMENTS > OTHER > ALTERNATIVE PERFORMANCE MEASURES | GROUP
TORM ANNUAL REPORT 2025 225
Glossary
Alternative Performance Measures
Group
Adjusted Return on Invested Capital (Adjusted RoIC): TORM defines Adjusted RoIC as earnings
before interest and tax (EBIT) less tax and impairment losses and reversals, divided by the average
invested capital less average impairment for the period. Invested capital is defined below.
The Adjusted RoIC expresses the returns generated on capital invested in TORM adjusted for impacts
related to the impairment of the fleet. The progression of RoIC is used by TORM to measure progress
against our long-term value creation goals outlined to investors. Adjusted RoIC is calculated as
follows:
USDm 2025 2024 2023
Reconciliation to operating profit (EBIT)
Operating profit (EBIT) 356.3 658.8 698.6
Tax -9.2 2.0 -4.0
EBIT less tax 347.1 660.8 694.6
Profit from sale of vessels -19.0 -51.3 -50.4
Provisions — — -6.5
EBIT less tax adjusted 328.1 609.5 637.7
Average invested capital¹⁾ 3,021.6 2,715.5 2,283.9
Average impairment ²⁾ 23.5 26.0 29.9
Average invested capital adjusted for impairment 3,045.1 2,741.5 2,313.8
Adjusted RoIC 10.8 % 22.2 % 27.6 %
1) Average invested capital is calculated as the average of the opening and closing balance of invested capital.
2) Average impairment is calculated as the average of the opening and closing balances of impairment charges on
vessels and goodwill in the balance sheet.
Invested Capital: Invested capital as defined by TORM measures the net investment used to achieve
TORM’s operating profit. TORM believes that invested capital is a relevant measure that the
Management uses to measure the overall development of the assets and liabilities generating the net
profit. Such measure may not be comparable to similarly titled measures of other companies.
Invested capital is calculated as follows:
USDm 2025 2024 2023
Tangible and intangible fixed assets 2,827.7 2,846.4 2,173.9
Investments in joint ventures — 0.1 0.1
Deferred tax asset 0.3 3.1 0.4
Other investments 2.7 0.2 —
Inventories 66.5 68.4 61.7
Trade receivables ¹⁾ 277.5 255.7 286.7
Assets held for sale 24.4 — 47.2
Non-current tax liability related to held-over gains -45.2 -45.2 -45.2
Deferred tax liability -0.2 -0.3 -3.6
Trade payables ²⁾ -112.6 -114.2 -91.3
Current tax liabilities -0.3 -0.7 -0.6
Provisions -0.7 -0.6 -0.5
Prepayments from customers -2.3 -7.5 -3.3
Invested capital 3,037.8 3,005.4 2,425.5
1) Trade receivables also include Other receivables and Prepayments.
2) Trade payables includes Trade payables, Other non-current liabilities and Other liabilities.
FINANCIAL STATEMENTS > OTHER > ALTERNATIVE PERFORMANCE MEASURES | GROUP
TORM ANNUAL REPORT 2025 226
Glossary
Alternative Performance Measures
Group
EBITDA and Adjusted EBITDA: TORM defines EBITDA as earnings before financial income and
expenses, depreciation, impairment, amortization and taxes.
EBITDA is used as a supplemental financial measure by the Management and external users of financial
statements, such as lenders, to assess TORM operating performance as well as compliance with the
financial covenants and restrictions contained in TORM’s financing agreements. TORM believes that
EBITDA assists the Management and investors in evaluating TORM’s operations by increasing
comparability of TORM’s performance from period to period. This increased comparability is achieved
by excluding the potentially disparate effects of interest, depreciation, impairment, amortization, and
taxes. These are items which could be affected by various changing financing methods and capital
structures, and which may significantly affect profit/(loss) between periods. Including EBITDA as an
alternative performance measure, benefits investor in selection between investment alternatives.
EBITDA excludes some, but not all, items that affect profit/ (loss), and these items may vary among
other companies and may therefore not be directly comparable. The following table reconciles EBITDA
to net profit/ (loss), the most directly comparable IFRS financial measure, for the periods presented.
Due to temporary fluctuations of the fair value of freight and bunker derivatives, the Management
believes that an adjustment for unrealized gains/losses on freight and bunker derivatives help to
increase comparability in EBITDA developments. The adjusted EBITDA is calculated as follows:
USDm 2025 2024 2023
Reconciliation to net profit
Net profit for the year 286.0 611.5 648.0
Tax 9.2 -2.0 4.0
Financial expenses 74.4 74.1 60.9
Financial income -13.3 -24.8 -14.3
Depreciation and amortization 214.5 192.0 149.3
EBITDA 570.8 850.8 847.9
Reconciliation to EBITDA
EBITDA 570.8 850.8 847.9
Fair value adjustments on freight and bunker derivatives 6.7 -6.6 -1.5
Adjusted EBITDA 577.5 844.2 846.4
Net interest-bearing debt: Net interest-bearing debt is defined as borrowings (current and non-current)
less loans receivables and cash and cash equivalents, including restricted cash. Net interest-bearing
debt depicts the net capital resources which cause net interest expenditure and interest rate risk and
which, together with equity, are used to finance TORM’s investments. As such, TORM believes that net
interest-bearing debt is a relevant measure which the Management uses to measure the overall
development of the use of financing, other than equity. Such measure may not be comparable to
similarly titled measures of other companies.Net interest-bearing debt is calculated as follows:
USDm 2025 2024 2023
Borrowings ¹⁾ 1,016.3 1,243.3 1,073.5
Loan receivables -4.4 -4.5 -4.5
Cash and cash equivalents incl. restricted cash -163.5 -291.2 -295.6
Net interest-bearing debt 848.4 947.6 773.4
1) Borrowings include long-term and short-term borrowings, excluding capitalized loan costs. Please refer to Note 19 for
information on capitalized loan costs.
FINANCIAL STATEMENTS > OTHER > ALTERNATIVE PERFORMANCE MEASURES | GROUP
TORM ANNUAL REPORT 2025 227
Glossary
Alternative Performance Measures
Group
Net Asset Value per share (NAV/share): TORM believes that the NAV/share is a relevant measure
which the Management uses to measure the overall development of the assets and liabilities per share.
Such measure may not be comparable to similarly titled measures of other companies. NAV/share is
calculated using broker values of vessels and excluding charter commitments.
NAV/share is calculated as follows:
USDm 2025 2024 2023
Net Asset Value per share
Total vessel values including newbuildings (broker values) 3,177.5 3,582.9 3,080.9
Vessel values of purchased secondhand vessels not
delivered (broker values) 150.6 — 479.9
Committed investment capital expenditure 15.5 23.0 35.7
Committed liability capital expenditure -141.5 -23.0 -226.1
Goodwill 1.8 1.7 1.8
Other intangible assets 4.0 2.0 1.8
Land and buildings 9.7 8.1 5.5
Other plant and operating equipment 2.5 3.3 4.4
Investments in joint ventures — 0.1 0.1
Loan receivables 4.4 4.5 4.5
Deferred tax asset 0.3 3.1 0.4
Other investments 2.7 0.2 —
Inventories 66.5 68.4 61.7
Accounts receivables ¹⁾ 277.5 255.7 286.7
Cash and cash equivalents incl. restricted cash 163.5 291.2 295.6
Deferred tax liability -0.2 -0.3 -3.6
Borrowings ²⁾ -1,016.3 -1,243.3 -1,073.5
Trade payables ³⁾ -112.6 -114.2 -91.3
Current tax liabilities -0.3 -0.7 -0.6
Provisions -0.7 -0.6 -0.5
Prepayments from customers -2.3 -7.5 -3.3
Total Net Asset Value (NAV) 2,602.6 2,854.6 2,860.1
Non-controlling interest — 0.8 1.9
Total Net Asset Value (NAV) excl. non-controlling interest 2,602.6 2,853.8 2,858.2
Total number of shares end of period excl. treasury shares
(million) 101.3 97.3 85.7
Total Net Asset Value per share (NAV/share) (USD) 25.7 29.3 33.4
1) Accounts receivables includes Trade receivables, Other receivables and Prepayments.
2) Borrowings include long-term and short-term borrowings, excluding capitalized loan costs. Please refer to Note 19 for
information on capitalized loan costs.
3) Trade payables includes, Trade payables, Other non-current liabilities and Other liabilities.
Liquidity: TORM defines liquidity as available cash, comprising cash and cash equivalents, including
restricted cash as well as undrawn and committed credit facilities.
TORM finds the APM important as the liquidity expresses TORM’s financial position, ability to meet
current liabilities, and cash buffer. Further, it expresses TORM’s ability to act and invest when
possibilities occur.
USDm 2025 2024 2023
Cash and cash equivalents incl. restricted cash 163.5 291.2 295.6
Undrawn credit facilities and committed facilities incl. sale
& leaseback financing transactions 398.8 323.6 342.5
Liquidity 562.3 614.8 638.1
Free cash flow: TORM defines free cash flow as net cash flow from operating activities less the net
cash flow from investing activities. TORM finds free cash flow important as free cash flow reflects our
ability to generate cash, repay liabilities and pay dividends.
USDm 2025 2024 2023
Net cash flow from operating activities 498.9 826.8 805.0
Net cash flow from investing activities -152.6 -442.1 -370.6
Free cash flow 346.3 384.7 434.4
FINANCIAL STATEMENTS > OTHER > ALTERNATIVE PERFORMANCE MEASURES | GROUP
TORM ANNUAL REPORT 2025 228
Glossary
Alternative Performance Measures
Tanker segment
Net Loan-to-value (LTV): TORM defines Loan-to-value (LTV) ratio as vessel values divided by net
borrowings on the vessels.
LTV describes the net debt ratio on the vessel and is used by TORM to describe the financial situation,
the liquidity risk as well as to express the future possibilities to raise new capital by new loan facilities.
USDm 2025 2024 2023
Vessel values, including newbuildings (broker values) 3,177.5 3,582.9 3,080.9
Vessel values of purchased secondhand vessels not
delivered (broker values) 150.6 — 479.9
Other committed investment capital expenditure 15.5 23.0 35.7
Total vessel values 3,343.6 3,605.9 3,596.5
Borrowings 1,011.3 1,241.3 1,067.6
- Debt on Land and buildings and Other plant and operating
equipment -8.8 -8.4 -5.4
Committed liability capital expenditure 141.5 23.0 226.1
Loan receivables -4.4 -4.5 -4.5
Cash and cash equivalents incl. restricted cash -155.6 -284.9 -290.7
Total (loan) 984.0 966.5 993.1
Loan-to-value (LTV) ratio 29.4 % 26.8 % 27.6 %
1) Borrowings include long-term and short-term borrowings, excluding capitalized loan costs. Please refer to Note 19 for
information on capitalized loan costs.
Time Charter Equivalent (TCE) earnings: TORM defines TCE earnings, a performance measure, as
revenue after port expenses, bunkers and commissions incl. freight and bunker derivatives. The
Company reports TCE earnings because we believe it provides additional meaningful information to
investors in relation to revenue, the most directly comparable IFRS measure. TCE earnings is a standard
shipping industry performance measure used primarily to compare period-to-period changes in a
shipping company’s performance irrespective of changes in the mix of charter types (i.e., spot charters,
time charters, and bareboat charters) under which the vessels may be employed between the periods.
For this reason, we apply TCE earnings in our financial outlook on page 28. Below is presented a
reconciliation from revenue to TCE earnings:
USDm 2025 2024 2023
Reconciliation to revenue
Revenue 1,314.2 1,544.0 1,491.4
Port expenses, bunkers and commissions -404.5 -409.2 -407.6
TCE earnings 909.7 1,134.8 1,083.8
Fair value adjustments on freight and bunker derivatives 6.7 -6.6 -1.5
Adjusted TCE earnings 916.4 1,128.2 1,082.3
Available earning days 31,840 31,287 29,152
TCE per earning day (USD) 28,783 36,061 37,124
FINANCIAL STATEMENTS > OTHER > ALTERNATIVE PERFORMANCE MEASURES | GROUP
TORM ANNUAL REPORT 2025 229