Earnings call transcript Q2 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Marius Furuly

Welcome to SFL’s Second Quarter 2023 Conference Call. My name is Marius Furuly, and I’m Vice President for Investor Relations in SFL.

We have a new format for the conference call this time using Zoom. And I hope this will be both as informative as usual and easier to navigate afterwards for you.

Our CEO, Ole Hjertaker, will start the call by briefly going through the highlights of the quarter.

Operating before Sjølie, will our through financials. Chief vessel comment take our the matters performance CFO, that, Officer, will Trym on us Following Aksel Olesen, and concluded this do the Q&A up The procedure before by will explain the be for call questions I session. will to opening

as note XXXX. Securities statements forward-looking anticipates, we meaning within to expects, Before to of our Words Litigation call similar conference the intended I presentation, this begin Private Reform statements. the of Act will such like U.S. or are estimates would that contain intends, forward-looking expressions these identify

Forward-looking activities materially conditions forth plans statements include, guarantees and and results performance. offshore to the that results to future current forward-looking are are from and in uncertainties These cause subject of that inherently to, be operations differ statements and factors are not markets. different set expectations limited the risks in our could future based not cause on those Important and statements. actual of credit shipping, but could are to

which discussion on risks financial should to results condition. Commission forward-looking place detailed not a undue these therefore our have may Exchange bearing filings direct on reliance and our more within statements. our Please uncertainties, the You and a and Securities for refer of operating

the quarter. Then I will with leave the word over second Hjertaker, highlights to our CEO, for Ole

Ole Hjertaker

were down X previous earlier total The of Marius. year. tankers the charter revenues quarter, were from you, this which in primarily Thank the traded million due $XXX quarter, spot sale to the

around of employed spot the bulkers with market. the end leasing from were have a long-term our company infrastructure in charters charter changed maritime on and Over the X% the revenues Only and business maritime we to vessels last time users. charters container short-term from XX to years, X model

$XXX has The months, in quarter over EBITDA with equivalent last million cash million], XX the for flow the [$XXX.X quarter. million. line was previous EBITDA been the $XXX [sic] approximately the And equivalent

net quarter to around share. $XX million upgrades. the no rig The the special income finalizing at continues impacted in income expenses, SPS be the had in but operating per drilling $X.XX and or revenues comprehensive net survey its quarter, which second or by in with full came while The Hercules,

The mid-June, started Canada. and in SPS was mobilization finalized to then the we

We fee have be the sale to been all transit, of a of the in GAAP last mobilization will costs. Suezmax rules, was also but Exxon gain from to mobilization traded paid recognized the quarter, third relating for in accounting $X tanker. due the million with spot quarter the this There the together U.S.

is a have paid over This $X.X our than years, have robust per the share. backlog charter And and XXth billion in quarterly And in closing dividend. total we $XX on more we is $X.XX share in share levels. continued dividend forward. with dividend a and announced dividend previous The going of per quarter supporting line at represents current price strong the very capacity yield

from the owned flow backlog build fixed the Hercules carriers rate additional onwards. increase forward cash continued visibility new drilling and from to the quarter charters. rig, recent going with Our flow car provides This at $X.X managed and billion vessels approximately cash third stands after significant and continued from

excludes our optionality, net the also to the significantly short-term profit market in the future contribute excludes traded can importantly, from book revenues back seen, share And we vessels figure and income. have which

rate million and value the which its $XXX,XXX X a period. approximately harsh is has a implying started under mid-July. for Canada contract The well, then estimated duration a day of contract days, mobilization estimated of and to semisubmersible, environment the in moved including own was to and drill XXX SPS and Canada The upgrade per mid-June, the to approximately from $XX day an with to power commence to Canada rig Hercules ExxonMobil completed work on

move commence an will of optional a rig well testing. Galp wells and two to the plus a contract Energia Thereafter, with for subsidiary Namibia

including of estimated period. XXX days, day approximately will $XXX,XXX mobilization with be for a an day rate approximately Excluding contract duration $XX per value the that optional days, million, of implying another

for After in rig to will secured XXX $XXX,XXX commence rig subsidiary with excess firm The The approximately contracts implying XXXX the EBITDA of next period estimate the Hercules well move fourth Canada is a the X and the for day from on is million, approximately transit $XXX duration for open now plus optional a million of rate new back including the XX X is $XXX will recently rig to we day from Canada, then per contract The X The the Namibia, well. from onwards. over contract backlog Equinor. announced and contract period. be quarter of approximately the the from months. days,

and This promising. is harsh with market recent a next and prospects particularly the announced in harsh balance. and XXXX supply-demand from for And our last most that available rigs positive the of year. $XXX,XXX goes day one bottom analysts market into market rig per contract ultra-deepwater Equinor evidenced recently as semisubmersible is only of activity excess This now we based by year, line. of see on only straight rates – XX% tight to handful is prospects environment The to tender are day up

X fleet. is net now fleet while approximately $XX in the earlier to option our back later market which bareboat divest And is ago tanker spot We tankers. charter vessel charter in rate August. gain the low Wisdom, them and is our estimated in $X to a in million. to quarter and the year, or is where cash the million, and will VLCC estimated the sold we fixed a sold this purchase only proceeds remaining we the traded Landbridge The charter book bareboat short we exercised third around continue tankers This relatively and the to on price world the renew sell a have

of up of an of million the has authorized repurchase aggregate the Board to $XXX May, In shares. of Directors SFL

cost been average share just an have million per amount, XX% or X.X and So $XX of at is the repurchased over of there remaining. million authorized $X.XX far, around shares

market in repurchases and transactions, legal capital, accelerated our and price, form alternative discretion availability uses and repurchase programs purchases of a any best negotiated requirements, stock that open conditions, be made interest will market or the combination of amount depend on are shareholders the timing The privately determination capital at of Further methods. share the in repurchases of repurchase programs, these share our of may other factors. company’s

We a shares. is This see valid to until program program terms value our in toolbox shareholder that not of under any of XX, would fiber June common obligated the note the the this and is the company XXXX. tool as repurchase

And to give Operating Officer, our that, Trym the will with I word Sjølie. over Chief

Trym Otto Sjølie

Thank you, Ole.

dry and XX composition stands over and billion. scheduled is and carriers are bulk tankers, September. current car in we Over in we the now at in shipping of X our under with The next and maritime around vessels, and China. The new backlog construction container our managed assets years, XX both starting XX months ships, fleet delivery have made for water XX rigs are X the X have drilling $X.X the X and fleet assets from buildings portfolio XX structure, changed up owned

varied customer now a to asset assets X majority of the We from vessels fleet just And XXX% XX charter container are with single years largest and involved offshore diversified via having the from class originally to a composition X segment under ago, counterparties. the backlog. multiple single XX% tankers being has fleet

maritime a now are We infrastructure company.

operating assume Most Exxon charters, company’s and years, type others. exposure, users and model instead which vessels but the for away completely XX industrial moved operating transform Maersk, last and full like, the of are X, makes from financing charters on relevant large Volkswagen, our example, long-term us over we have have end for bareboat

of second contracts time dry X% from XX% quarter, charter from charter assets bareboats from In all leases. revenues and only or the came

significant we contribution aggregate over fixed share share and rate $XX from to cash cost the been fuel. both addition months, on to million. profit revenues, Last time, has In more arrangements XX charter rates profit flow than to charter had relating savings have

trading. on charter have and spot contracts Out of XX on bareboats XX we the and vessels, current XX

Our across complex with multiple vessels operation is quite sectors.

and our own have Oslo and of operation commercial of operational Singapore Stavanger. out We management out

increasingly as increase to investments and with optimize the includes indicators, performance profile, to energy become level including invest as our of This investing well philosophy fleet to Our OpEx consumption. important high customers. carrying implementation vessel’s which of is hire IMO cargo carbon service intensity our has off to routing speed. This in to capacity vessels’ and minimize continuously a maintain reducing operational and impact the will

had we less technical off-hire a defined X,XXX off-hire QX, total over In drydocking. operating as days or days for calendar of

million as revenue in overall to XX.X% the number possible. a maintain quarter from charter fleet across and was our $XX $XXX we high million. Net OpEx is the QX, our Our was fleet in are in striving QX, continuously utilization as

metrics average AER key SFL for and is weighted emissions the capacity of per carbon or sales. Ratio. a how Efficiency is reduction by AER as carbon-intensive actual of fleet a Annual emissions our of indicator carbon improving intensity measure is fleet calculating the the our One by distance

rating implemented for obtain The towards acceptable carbon tonnes larger requirement will onwards. from reducing all each While the to XXXX requirements CII MARPOL Convention, year gradually XXXX. IMO of ships an than have gross intensity be stricter X,XXX

fleet can by of requirements combination efficiency a both. renewal, of met or Such fleet either increased existing be

positioned towards SFL to compliance trajectory Although well CII is is certainly challenging, manage XXXX. IMO’s

under carriers will we in carrier efficient our renewal construction in that service fleet into car the among when of dual-fuel ships car China most LNG be have As part the entering modern and program, X market.

and capture energy from voyage and in for for efficiency real-time On front, an sensors devices investment carried analyze energy-saving vessels all and to out management performance we have technology data program optimization. our including onboard fleet, the

includes of new cargo upgrades. are exhaust antifouling scrubbers, cooperating well and closely modifications, several propeller propellers systems. The fixtures Furthermore, scope on with all further as charterers key vessel gas our as boost, intake enhanced we

charters more on We for management. integration data weather collaborate key performance with also and routing optimal

of we investments the our believe either In make reducing up extensions. will vessels in addition charter market attractive carbon redelivery the these to when are for vessels more potential emissions,

the word Aksel the I us quarter. with to over give who will highlights our CFO, of And Olesen, take will that, the through financial

Aksel Olesen

items. the net you, noncash we U.S. not note pro a Thank and slide, in of quarter. to accordance is also Please this and that with set forma cash extraordinary is shown illustration the performance company’s have and for second On a of GAAP only flows guideline this Trym.

$XXX rate company hire approximately the profit on flow currently approximately going fixed stands generated charter of of visibility the share, second million providing $X.X cash including gross quarter, $X.X with our coming in the forward. billion, revenue which approximately strong from flow us XX% The cash backlog, of with million charter at

of share related profit our second in savings $X large gross fleet the X In million generated approximately the to charter quarter, $XX of hire container including fuel approximately containers. million, on

during hire quarter. charter tanker $XX generated gross Our second to fleet approximately quarter, million in compared $XX previous the the in million approximately

hire quarter, our in strain the from $XX remaining market quarter vessels in spot of compared the was spot quarter. X delivery Charter second vessels following second sale during first the and million $X.X the million, the to the in

QX contribution were from the long-term we XX as million quarter. Consequently, contracts not the in charter on do generated onwards in dry $XX high-quality quarter. trading during are carriers, market any company as X from higher employed XX The long-term well gross expect vessels has which second in approximately charters with charters. the employed spot on tankers The bulk tankers of remaining

million in the $X.X vessels in hire short-term approximately to and and previous Seven the market quarter. compared quarter, and employed charter contributed were the these during million approximately $X.X of spot

X owns is current drilling rig XXXX. Linus rigs, Skandinavia on with of The end Linus until Hercules. and jack-up ConocoPhillips long-term environment semisubmersible contract SFL a the the rig the harsh

the rig in with quarter. $XX second approximately million the line the contract first revenues, generated During quarter, in

we survey which operating upgrades, to the quarter no on before there million. special first As in mobilized commence were periodic approximately with contract been to revenue recorded quarter, from Hercules the were due mid-June during completed which in has drilling the the rig $X Canada. Hercules, Canada expenses Furthermore, to the and Exxon

date. Accordingly, Exxon and P&L. recognize which in over second for recorded to commencement drilling standards contracts therefore Although for base quarter drilling only will GAAP demobilization service the revenue in mid-June, third amortized mobilization we no the due quarter QX commenced U.S. a recorded the Canada mobilization cost revenue drilling in and Hercules the from in towards and revenue be the contracts, accounting

of charter including carriers savings net And the quarter, second of to approximately finally, one million our gross car during profit generated X related the approximately share fuel $XXX,XXX $X vessels. on hire

to million] G&A [sic] the $XX [$XXX.X of million an Our compared operating quarter, expenses million, previous quarter. This and million quarter. million XXX the to in $XX second for was approximately $ compared in $XXX the summarizes previous adjusted quarter the to EBITDA in

on the U.S. loss move as to and on reported GAAP. then We the profit statement

of in different previous have from shipping we are a accounting our statements described company. those traditional calls, earnings As

our Therefore, entities So business type, our and repayment on some portion for are revenues purposes. contracts, from investment sales large activities long-term leaseback GAAP a leases as from classified accounting charter in a in strategy of This significant includes are classified of revenues. part of as revenues associate U.S. financing focuses charter and direct excluded capital assets leasing. operating investment

quarter total $XXX the the to million received report million, actually of for is less than So hire reasons revenues second mentioned. approximately U.S. just operating according $XXX of approximately GAAP charter which

rig or only as and to Hercules, a accounting from on standards quarter our approximately on state. And reflected did has container During income our GAAP vessels the share quarter, the duties we fuel And mentioned, a recorded full from carrier. third been Hercules nearly date the revenue large $X.X the drilling in and due just of operating we recognized the car the record quarter. million of temporary savings were of in from company expense U.S. some recorded not any commencement profit revenue from we P&L

were a $X a including nonrecurring, $X.X on $X.X Furthermore, negative million Everbright from from of mark-to-market the gain million, of items, effect $XXX,XXX the provisions. tanker and noncash A net mark-to-market Suezmax loss sale positive of impacted decrease of effect results equity million. by of a investments credit net the approximately

company per U.S. $XX of net reported to according share. profit approximately $X.XX and overall, or the million So GAAP, a

be onwards quarter our the next quarter, the carriers on transitional first revenue Also, to Exxon from contract it’s we from worthwhile during car record we the a the X mention of in rig X Hercules from expect QX expect to commencement to that revenue increase revenue quarters. July. as reporting will While newbuildings of effect we the delivered following

these and $X charter million $XX X X-year year, approximately EBITDA significant car We new per existing million the carriers, which for to will QX. approximately addition, contracts, estimate in In from year. and Composer commence was Conductor per QX on increase be

option Moving cash cash cash quarter the recorded delivery of based million of of million at approximately the $XX had – market on A take on marketable $X place In June, debt equivalents. bareboat after Furthermore, to quarter. debt at At to end the effect repayment purchase approximately the the not corresponding securities to of the August. sheet. expected with third end VLCC is and SFL is the on company SFL end, relating has approximately filed secured of the charter, $X.X $XXX to balance which quarter. be of a on the million prices in positive vessel gain book about million

program. company back the May, million In share announced $XXX

average So per the price company $X.XX approximately far, at million approximately acquired an of X.X share. has shares

quarter During in per the the second drilling fourth ‘XX, the X the million quarter and in Linus ‘XX of Hercules in loans quarter, SFL have of $XXX refinanced with Linus respectively. loan rig. rigs refinanced Hercules and facilities The matured separate and

X JOLCO the the car matching the $XXX expected secured first capital arranged financings vessel million been JOLCO rates car Sea which container to that carriers of existing positive of flow quarter another second company chartering contracts, match the outstanding vessel with million are during expenditure $XXX are under the Arabian third and The the long-term arrangements. construction, debt delivered has free. to vessels, Maersk X vessels in carrier the maturities on secured the be our as The net is Pelepas. quarter very at of for effect cash Furthermore, attractive

remaining to a completed, respect second which $XX goes $XX facility paid in And upgrades on the funded be carriers predelivery for during approximately the same survey construction. car down X to the outstanding CapEx with for special on under the drew be And last The cash million quarter, is with on we periodic and Hercules, now hand. million, will September. the of maturing amount a

equity ratio the numbers, has company approximately the on XX.X%. QX based book So of

yesterday. conclude, approximately the share $X.XX represents the the on May, company quarter. of a In million Board per X% of dividend share a for the This share price announced Then declared based buyback. closing cash to dividend $XXX has

acquired And $X.XX approximately so the for X.X shares price a far, million company’s approximately share. of per

charter backlog $X.X building new cash flow and on going with the currently financed long-term rate of company’s strong provides the is is materially all debt new latest at The billion, visibility refinanced us stands Our which concluded fixed financing program with short-term capital expenditure forward. fully now facilities loss. the

far contract different secured in a contract significant million recent $X continued existing per Furthermore, wide the funding arrangements the $X carriers diversified securing EBITDA in a across which has financing $XX excess forward. with split the array of in increase is new Volkswagen so billion. vessels per XXXX QX, and a in awards well QX XX platform million amount of year, SFL for from X The going for with was facilities summary, these is approximately and commencement car from products, with company estimated contracts, year. approximately In

we a environment and semisubmersible tightening and market attractive rates a a Finally, balance day which Hercules, drilling strong supply-demand strong flow contract a new outlook, a now is announced materializing award generation. harsh for cash confirming rig, in

on we the conclude presentation And session. to with and Q&A that, move the

Marius Furuly

Thank you, Aksel.

now session. a will open up We question-and-answer for

a your have ask unmute your please following of our question. will your presentation ask are from Diamond. Zoom, Please unmute question. And is through you When speaker you. question Richard function raise those first this Thank question. out, hand use speaker called who to your name For the your to to ask please we

Richard Diamond

afternoon, Good everyone. Yes.

significant future capacity lack is the assume will options and purchase shareholders? to rising represent it the of general value shipyard to fair the values, ship Given SFL in in

Ole Hjertaker

on start as the now a where order of with say prices money they also newbuilding can little instead book profit losing of used actually do. make to full of coming shipyards, you the they of to very back yes, both a a up, the bit substantial, Well, lot at

You that raw – the goes both that into building will building when course, to the also have will labor prices. time material cost ownership of values and, be the have typically over second-hand inflation newbuilding it. Which in ship means linked

probability sort So to purchase a we just called there were typically model what order to That’s if deals. that away in they game. being of we of do in away shipping us. from exercised, do course, financial the we therefore, options then, higher when and provider the most of in would those options people are a have old purchase give leasing is space, sort where And had of

So – the existing good financial carriers reach if would have of but we rate goes they example charters instead lease, the can the at a have higher straight on here, is options because car the charterer them course, we much that the exercised those now, and purchase think had of first we more have a we been is, in out than shareholders. to

I So benefiting newbuilding think existing rising definitely is shareholders. prices

Richard Diamond

you. Thank

Marius Furuly

you, Thank Richard.

unmute our Climent take question from speaker question. will to We next ask Molins. your your Please

Climent Molins

and I contract strengthening semiannually. we our I questions. adjusted vessels Linus, about environment? for which taking employed which, think forward if correctly, team. is the How to about and on you by should is Thank want earning my going market start Hi, contribution asking the West the given remember adjusted Ole market rate,

Aksel Olesen

correct. is that So

Sea. side on the until on of in line XXXX field with on end the ConocoPhillips our is North the Ekofisk northern So the the contract

There adjusted around out, is of shy point As per the end day. basically just semiannually, you $XXX,XXX end of of is correctly and contract October. April

somewhat For market neutral. – the is of is that time in still being kind

region continental higher also Norwegian rig. stay the could least rate also that contribution to time forward, being. we the on and at over reflect we increase a that shelf potentially But in the then going to from expect expect for So in time day activity

Climent Molins

generate? the wanted hedged? to delivered the on the is to car year. to over vessels Could vessels down finance I ask carriers And be expected drawn also incremental about provide to be flows, the those debt next secondly, you the cash to commentary some are

Trym Otto Sjølie

considered an I we the But substantial, So coming X is contribution first say, there. the buildings have initial – where cash voyage especially will for from it’s new would think... I vessels still

Ole Hjertaker

do not we mean, of contribution per vessel an on basis. sort I disclose yes, Well, individual

out, then right will vessels delivered So have Europe, you as to pointing where market hot. carriers Asia voyage first, was Trym to will is now we be for as car the spot first, delivered, super Volkswagen. from The a

will of Market the currently contribution So on very to voyage $XXX,XXX we a in from Europe. a significant have excess hopefully, quoted Asia well – is per very day.

needless with in pre-agreed OpEx a when an And existing rates. for per there’s $X,XXX lot rate charters And day the cash the there. this, then of charter also of So to at they the XX-year that’s around similar vessels. commence kick say, will coming like on the flow new charter will vessels

coming to the builds. rates haven’t including do of give the we by that. can have in, several charter full of full and what is out elements also sort have provided where charter once new So backlog we but everyone it that you effectively generated vessels, we back But breakdown our the being access are

Aksel Olesen

Exactly.

on that So fix returns these the long-term it, call Conoco, teens low be Japanese at basically, financing X And operating I vessels is for leases that strategies is on course, with if contribution exact accordingly. not in with is – so the do into will that. and form out attractive equities, the financed, details financing, go mean on ones on you of terms. will look the first X still charters then delivery, our of at I down the to be it fully drawn very connection

extremely is attractive. provided margin the course, of But

to banking financing, is of financing final traditional on blended market. in, more it’s kind fixed up the So far all long-dated than delivery. competitive going considering then be And the the

Climent Molins

from Makes me. Final question sense.

How we about markedly. dividend plan balance forward? it’s potential you your Looking that, repurchases? second flow secondly, share going will And into should think with year of how dividend do raises that at potential so the half the raises and cash XXXX, clear to improve

Ole Hjertaker

Yes.

returning of we, mean – I both see indirect. shareholder So effectively direct to as and course, capital shareholders

on we of shareholders. quarter give the the never we next distribution the never dividend everything is course, around of is, to building focused that. what But be communicate guidance or in what after sort Our capacity and quarters do will aim – we

and seen of managed sustainability But the being every the deliberations around we discussed. of, increase typically, an it, usually, quarter is sort stay to piece when in we past, dividend the the the dividend call also the there. when have important of dividends, Board, we long-term Board level

have quarter flow You’re builds. That’s cash second back out correct, first more that paid costs incurred onwards being and with hopefully we than primarily significantly X will third is working and rig rig quarter. service then to of and now being due and new get the

But dividend specifically how we back. of be will – specifically shares you after, and kind we guide might much will quarter what next on the nor how buy communicate many we

and We have over shareholding, so of X than million we be X% more our around have communicated shares, quarter that forward. that and every quarterly report as numbers going authorization to will from the buy Board just bought an the back we

Climent Molins

Makes Thank sense. questions. That’s all my you for me. taking for

Ole Hjertaker

Thank you.

Aksel Olesen

Thank you.

Marius Furuly

Climent. you, Thank

Hamid. Our question unmute. Please comes from Arif next

Unidentified Analyst

Hello. Yes.

good management a requests. team I to the continuing job. do like First, compliment questions have on to I’d two and

and reduced is question some What builds certainly first reinvest. to used for inventory the and assets? appear attractive Okay, both new you’ve areas have for now, cash

Ole Hjertaker

Yes.

I you We it are are agnostics. – looking mean, segment call – can we

only example, out an that. a small year, fraction billion, of That’s aggregate modeled up and transactions we doing as parallel. value the a reflected in also So and focus and segments across mix. We with coincidence. just And in which ended opportunities an at in of look transaction maritime around last space vessel all in screened the is we $XX these we our board

do so are got asset. there the a reasons you with counterparty, right And to many why deal. be right don’t the It’s for

and, and kind to the long We are charter, the of say, specific financing, want for the the think is we available term, – we et that assets cetera. new with driving of we where mindful very of what sort is own what fuel of specific asset,

done, that lot, – returns could – we returns, and we – if low been a course, as we deals. really would course, do haven’t have we lot If are want more. agreed we if we we hadn’t and of accept of So proper

comes So don’t specific long-term all capital shareholders. on of about between trying all this to together, it’s and value we deliver segments. And for guide allocation

and and side, time, container on were the carriers. more the ships we company, the now other space times you sometimes, specifically seen investing over So more have over the and we have energy that, liner history in also invested car of

deals I that hope of to segment the side there side, – as they But are say. prefer from dry out we opportunities, would segments, long-term can say are is which that’s the maybe orders, we flow fewer business. and the cash build because to for we long-term see the frequent as So relatively that round visibility. on some our that to portfolio. tanker we which will bulk the And not instance, exactly there well, we be, find cannot you but see chartering

So the we looked across board.

Unidentified Analyst

So there’s a no specific area that looks like good trend now? right

Ole Hjertaker

No.

call now. near-term, to cycles. – XX-year there, of market of has talk people’s And charters, when the shipping look which the focus now, in many sort through sort have low on look near right book, right a deal cycle. typically think say just for have course, if they’re is it, on which we like to near-term the do market that a we you I tanker analysts, But record many order of attention we course, you and of term,

So many specific segment. it in goes XX years, as can, in want you ships you as build theory, any

in the makes the So that end taking the technology, of call asset think cetera, at the to sense for up value or counterparty where and that in risk, charter. the right et it, it’s right it, in we look residual, the exposure a, a we addition call to end charter structure important with counterparty more right the

company from structures, would users. the lot the business I end model service who we our and have, going done redone bareboat or give say, way of then And intermediaries, a is that it, we to typically more where did call with a financial-oriented bareboat-like

logistics So better changing type more gives end that over risk/reward and that more cycle think operationally integrated to us time. set we that maritime deal up also with means we a And directly users.

Unidentified Analyst

beginning. the selectivity part in that’s your reason at for Okay. the complement Well, of that acquisitions, my

question you how Okay. increasing you next the cash My income? about quarters. big substantially is operating next estimate in couple a an Can jump income, of flow the make in you of talk see

Aksel Olesen

guide Not too be think advance. really specific to – we somewhat, I don’t try like to really quarter-by-quarter on in

also take I including from start-up QX the see over particular, as in just the to think we contracts what the Hercules for see demobilization, that service that according periods, you’ll kind the accounting is of the in drilling, you’ll guide rig actually drilling basically will mobilization, we of commencement costs. be contribution that

forward. So quarter-to-quarter that will also be a going bit bumpy

first basically in car see QX. the QX, in carriers same contribution you’ll in Then coming

it can QX, full building up, car the and you’ll from So kind be QX into carriers. the the think, I of and contribution rig see then

So it the tankers looks There’s kind with up the that, no everything mean, Basically, promising. on I more somewhat solid. of it looks marginal. on that’s think dry I locked But contribution spot in. is

Ole Hjertaker

per And that rig, drilling $XXX,XXX recently straight if the the most goes first $XXX,XXX on we I and line. then of to look at the charter excess of charter in And the so day. mean is bottom or rates around charter the is announced

But So next into over that, of is have that effect. will course, year. a well good time and

Unidentified Analyst

great. sounds all That Okay.

middle steadily better. there the quarter, might year, be but lot this a So right? like be increase. the we might next by of what that a will next it sounds jump, looking modest is Is And

Aksel Olesen

I step think instead building up be step. we’ll by

Ole Hjertaker

significantly costs... had that And with I revenues, because so that the service, think say quarter quarter, second second in we will X the rig then I but from drilling of it’s quarter, out up to third be fair think

Unidentified Analyst

quarter, you’re right? You on some costs sitting the have next for

Ole Hjertaker

Yes.

the have So also we costs next rig. still some quarter, then we revenues have but from the into

Unidentified Analyst

book costs have quarter. That’s what so I’m going saying them this next you in to you you’re that couldn’t quarter, book is

So be good. the revenues won’t as

Aksel Olesen

It’s second quarter. third that the days XX only being quarter are approximately into – transferred from XX, XX the

So not too much.

Unidentified Analyst

sounds Okay. great. That all

Okay. know I you of know the And be have is, the closed, very once be company do X the is, but what you position what change cash is. has or company that would deal request. disclose new I the details, of usually what when would in helpful the a position the cash don’t the deal, to

announce would consider you if that out information a deal, So you could that helpful. giving be when

Aksel Olesen

Absolutely.

quickly on is a strengths a it And do we to turn quarterly and is company I as today basis. close one around do we what think think of I transactions. our

cash the later. then in use the out and the we just order optimal we find close sheet best balance to price do and sometimes possible to And on financing transaction financing,

at actually be will that accurate report that closing. to So quite

So I on try SFL. like we think, the very I open company I for a And be quarterly that’s, to of kind basis. think what was think feasible

Unidentified Analyst

Okay.

And last terrible the Sounds to sound presentation, good. last or wanted here is on what fine. quarterly was very it’s and time Zoom, I and announcement say just

questions. and you Bye-bye. thank for for thank So my much taking very you that

Ole Hjertaker

you. Thank

Trym Otto Sjølie

Thank you.

Marius Furuly

Ole. Thank you,

question the Our Christian unmute to Wetherbee. of from ask next your Please question. comes line

Chris Wetherbee

for Thanks question. guys. the taking thanks Hey, Yes.

So I container actually had a question on side. the

give So on pertains are the customers curious to going charters what it sense general terms from thoughts overall the to in in obviously, your to you’re I vessels. demand just market. in as get you spot insulation of of hearing some peak a utilization the from market. But know, fluctuations of just

online market. across some over that in several a see of Curious is longer-term industry of the about business Or perspective? of come we the that more bit the of trans kind think capacity this think And terms course before a you the new pack that you quarters? to then building in on potential the bit spot blip begin discussion stabilization programs were We’ve to if of rates inflect any out there’s if seen a higher. a business anything of over next of can

Trym Otto Sjølie

in the high. ships, – and what utilization of fleet, precise we our well. It’s utilization charters together but it’s our that to charters to our ships is see no have container – from There with be the kind the on is very that difficult because do discussions see, that with us. of all And to ships in we the our looking side, type invest on as has are on waiting newer of

of the the Of large course, the are lines. sizes big course, to of XX,XXX But theaters XX,XXX butter all seems the of sort sources bread sort of in to really ships to and TEU not of same. be

to we have least issue. our there seem to is from from forward, what hear see rates, an all sort box the Things healthy. be very hear mix panic of worry be The that – looking of fallen, volumes, not they rates is definitely discussions, about. that big so no are at and or And any any seem we

container the shipping focused focused they what not really at, think they really on on are mean, What and are is I really – so companies are anymore. ships. lines I And so looking they not they logistics are are

more do at looking are are with their are the they Hapag-Lloyd to down, really. and And Maersk of can get owners costs the is that that So see becoming and a lowest and important especially that good and that believe more that cost we container us, and for from in carrier help focus really likes carbon and big position. emissions we them the that’s

Chris Wetherbee

law. more to X change just going It in briefly the have company question, if Bermuda has do if the I in I’m that’s ask. with wondering corporate at affect law all. to I could

Aksel Olesen

you’re taxation? assume Or to referring kind I the is of global OECD it?

Chris Wetherbee

taxation. could that recently I’m be you just but about a not just definitely change. read I sure. said, proposing It corporate they’re It’s what

Aksel Olesen

I kind to thresholds Yes. don’t I call that meet at and think yet. of Not sure we think that’s global that. it, certain, threshold initiative are a of kind

many think, tonnage different also tax shipping are see under I structure. companies

of that’s, in possibility course, under is Cyprus. our already of wrap a some fleet So and

and management So Board and following evaluating is that closely. the

Marius Furuly

I everyone no questions from call. would in the to participating there audience, As for thank conference like further this are

our page, If get are the any the there pages with web much. through management, contact touch follow-up release have Thank in on can press very you to contact details you in or you www.sflcorp.com. questions us

Ole Hjertaker

you. Thank

SFL (SFL) 17 Aug 232023 Q2 Earnings call transcript