Solstad Offshore ASA

Good morning and welcome to the Solstahl Offshore second quarter presentation. It has been a strong and active quarter for the company with the improved operational performance, important contract wins, increased the backlog visibility and a continued capital distribution to our shareholders. We have also taken important strategic steps through the new joint venture we have established with SPM Offshore and the ordering of a specialized mooring and installation vessel further strengthen our long-term position in an attractive offshore market. This presentation will be held by CFO Kjetil Ramstad and myself, CEO Lars Pedershusa. and there will be a Q&A session after the presentation so please send in your questions in the chat. We take a quick look at the disclaimer before we move over to the business update for the quarter. It has been a solid quarter with increased utilization and earnings from the vessels. as well as good performance from the JEVs and the associated companies. We entered into a long-term contract with SPM Offshore for a new-built specialized moving and installation vessel and this vessel will be jointly owned with SPM and start operation in 2029. We have also signed an MOA for the sale of the vessel Normantonio We own 56% of the vessel and we expect a cash effect for Solskjaer Offshore of around 19 million US dollars when the vessel is delivered to new owners, sometimes during the next six months. During this quarter, we have also won an arbitration case, which will give the company a positive liquidity effect of around 14.5 million dollars when received. and a P&L effect of USD 7 million has been booked in second quarter. On the earnings, we delivered a total adjusted EBITDA of USD 41 million compared to 32 million in the same quarter last year. This is divided between operational adjusted EBITDA of 22 million compared to 17 million same quarter last year, and share of result on JVs and associated companies of $19 million compared to $15 million same quarter last year. We have had an order intake of around $216 million in the quarter, where the letter of intent for the Norman Maximus is the most significant. We are in the process of transferring the LOI to a firm contract and this will keep the vessel occupied until Q1 of 2029 with further options thereafter. This contract will also be favorable for the financing of the upcoming purchase option Solstead Offshore has on the vessel. We continue to return capital to shareholders and are increasing the dividend for the quarter to USD 0.15 per share, corresponding to approximately $12 million, more or less the same amount as Solstice Offshore perceives in dividend from Solstice Maritime. And then I will hand the word over to you, Kjetil, and take a closer look on the numbers.

Thank you Lars. So if we start looking at the financial and operational summary for the second quarter and the first half year. Second quarter of 2026 had a fee utilization of 85%, lower than the same quarter last year, which was 100%. For the first half, the fleet utilization was 82%, down from 96% last year. The lower utilization for the quarter and for the first half year is mainly driven by two vessels. The Norman Topacio started on a four-year contract with Petrobras in late May. and Norman Tonja was idle until mobilizing for a new contract in Asia-Pacific in the quarter. The rest of the fleet was fully utilized. Operating income for the second quarter was $105 million versus $78 million last year. For the half year, operating income was $191 million versus $147 million. last year. The increase is driven by four Solsta Maritim vessels on bare boat to Solsta Offshore, which all commenced their four-year contracts in February, and recognition of approximately $5 million related to successful outcome of the arbitration regarding disputed hire from 2024. Operational adjusted EBITDA was $22 million in the quarter, an improvement from $17 million last year. For the first half, the operational adjusted EBITDA was $34 million, which is in line with last year. The 10 million dollar improvement from first quarter this year is driven by the mentioned 5 million dollars in disputed charter hire and all owned vessels now being on contract. In terms of adjusted EBITDA, share of results from joint ventures and associated companies came in at 19 million dollars an increase of by $4 million from the same quarter last year. For the first half, the adjusted EBITDA was $75 million, an improvement of $13 million, or 21% compared to last year. The net result for the quarter was $38 million versus $39 million last year. For the first half year, the net result improved from $62 million last year to $67 million this year. Book equity at the end of second quarter was $478 million, up from $349 million last year. This reflects an increase of almost $130 million. and it gives an equity ratio of 44%. Book equity has increased by the net result in the period offset by dividends paid to shareholders approximately $16 million. The adjusted net interest-bearing debt of $28 million at the end of second quarter down from $83 million The cash position at the year end was $83 million versus $60 million last year. The main reason for the higher cash position is strong operational performance and limited capex the past 12 months. Burn backlog for solar energy on vessels of $432 million at quarter end versus $238 million last year. This is an increase of approximately 80% driven by improved visibility for Norman Maximus and the egg handlers in Brazil. Then if we go to the next slide, then have a look at the debt overview in Solstokshore. Solstokshore has a term loan of $70 million, paid down $10 million in the quarter. This facility was drawn in November 24, a five-year amortization profile, and the maturity in November 27th. And then we have the $40 million financing of the four Brazilian-built vessels, with BIM-YES. This loan matures between 2026 and 2031, with low scheduled amortization over the coming years. The lease commitment includes the present value of the Norman Maximus Baerbock Charter, $36 million until October 2027. and $112 million, which represents the present value of the purchase option that we have at $125 million. The other lease payments of $246 million mainly consist of commitments from Solstah Maritime Vessels operating through Solstah Offshore's Basilsetter. These commitments increased significantly in the first quarter this year due to commencement of contracts for Solstad Maritime Vessels going on a four-year contract in that quarter. Solstad Offshore has external backlog covering the lease commitments In summary, Solsta Offshore has a net interest-bearing debt of $422 million, and adjusted for the leases from Solsta Maritime, the adjusted net interest-bearing debt amounts to $28 million. On the next slide, we will have a look at the dividends for the second quarter. As a consequence of the improved earning visibility and the financial performance, the company will increase the cash dividends in the second quarter from $0.1 per share to $0.15 per share, totaling approximately $12 million. This represents a dividend yield of approximately 8.5% based on yesterday's share price. The dividend will be paid in NOC, and the NOC amount will be announced prior to that dividend payment. Key dates for the second quarter dividend. Last day of saving, including the right to receive dividend, 16th of July, 2026. X date 17 of July the record date 20th of July and then distribution date will be on or about the 29th of July 2026 So with this I will give the word back to you again Lars Ja, thank you Kessel and I will take a

a closer look at the investments we have into JREs and associated companies and these comes of course in addition to the fleet the own fleet and first the Solskjaer Maritime where Solskjaer Offshore holds 27.3% have had a strong water and Solskjaer Offshore will receive about 13 million dollars in dividend for this water And now Solskjaer Offshore's share of Soma's market cap is about, after second quarter, is about $313 million. Nisa is the JV we have with SVM Offshore. This JV owns the moving installation vessel Norman Installer. The vessel had full utilization in the quarter. and such part of the result for the quarter is about $1.4 million. The vessel is nearly fully booked for the second half of the year and the booking for next year is also already solid. The frame agreement with SPM Offshore where they commit to hire the vessel for around 200 days per year has also now been extended to 2034. and LISA is a debt-free company. SoFors owns around 36% of Omega Sebsi, who owns and operates ROVs, survey and associated equipment. And Omega Sebsi now have 16 ROVs in operation and further 14 for delivery in second half this year and beyond. The majority of the ROEs are mobilized on Schuster vessels, but the company have also entered into contracts with other companies lately. During the last 12-month period, Omega Sensi have had a revenue of around $96 million and an EBITDA of $27 million. And Schuster combined book value of its shares in the three companies are about 295 million dollars. As mentioned before we have entered into a new contract for a new build that requires a new build vessel and in more detail SPM Offshore and Solskjaer Offshore has established a new joint venture that has ordered a specialized mooring and installation vessel with CIMC Raffles in China and the vessel will start on a 14-year contract with SPM upon delivery from Yard in 2029. This follows the same basic partnership model that has worked well with SPM through NISA over the last 20 years and it allows Solskjaer Offshore to participate in a high-end long-term contracted asset with limited equity contribution and the rationale is supported by expected long-term demand for mooring services including new FPSO developments maintenance on existing systems and potentially floating wind opportunities into the next decade. And the new vessel has unique installation capabilities down to 4,000 meters of water depth. And if we continue and take a closer look on the market, I would say the overall activity level in our markets remains high. and the outlook continues to be positive. For Sul-Star Offshore, the anchor handling exposure is limited to Brazil, where all three of our own vessels are on long-term contracts, where Norman Topacio commenced her four-year contract with Petrobras around 20th of May in the second quarter.

Globally,

the anchor handling market is strong especially for the largest vessels with project capabilities and with spot exposure to the North Sea market for the CSV segment the activity is good but it's very project oriented with a few exceptions and Petrobras is one exception where a number of medium sized vessels have or are about to start on two to four year contracts within the RSV and walk to work segments. In the Solstads offshore fleet, we have a few vessel updates during the water. Norman Maximus has transferred from Brazil to Guyana and from there to to mobilizing in Las Palmas and is now on her way to the next project in the Black Sea. And she will be on that project until the planned dry dock starts late this year and continues into first quarter 27. Norman Superior continues on her contract in Angola until first quarter next year. And the client has an option to extend the contract with one more year. And during third quarter, it will be clear if that option is exercised or not. As mentioned, we have an MOA for sale of the Norman Tonya. The vessel will be handed over to new owners after the present contract she is now on. and that would be at the latest early next year. The sale will have a positive cash effect for Solskjaer Offshore of around $19 million. The utilization in the CSV segment in general is at a high level, but there are also some vessels that are idle and or have available capacity going forward. And I would have liked to see a bit more activity, especially taking into consideration the new buildings that will be delivered from Yards the coming 18 months or so. Geographically, the story is the same as earlier, where South America, including Guyana, West Africa and the North Sea is the busiest areas as we see it. Taking a closer look at the backlog for the company, our backlog provides good visibility for the coming years, with very limited vessel availability. During the second quarter, the backlog increased substantially, mainly driven by the new Norman Maximus contract. The total backlog is now close to 1 billion USD, of which approximately 430 relates to the owned vessels, with the remaining backlog is related to Solskjaer Maritime vessels on contracts through Solskjaer Offshore in Brazil. And if we then move to the guidance, Based on our performance so far this year and the current operational outlook, we are narrowing our operational adjusted EBITDA guidance range from USD 50 to 70 and then up to 60 to 70 for the full year. This reflects among other things, the expectation that the dry dock of the Norman Maximus will predominantly take place in the first quarter of 2027. And it is important to note that this guidance excludes the contributions from the joint ventures and the associated companies. We are also increasing the quarterly dividend to 0.5%. 15 USD per share, corresponding to a total distribution of approximately $12 million for the quarter. So to summarize the first half year and second quarter for Solstad Offshore, we delivered a solid quarter, both operational and financial. and with improvement in most of the key parameters year over year. We have secured important new contracts, although the new CSV with long-term contract already in hand and our investments in the JVs and associated companies are performing well. The activity in our markets is at the high level and the visibility for the company in the coming years is solid. We are narrowing the guidance range to an operational adjusted EBITDA of USD 60 to 70 million dollars for the year. And finally, we are increasing the quarterly dividend to 0.15 USD per share. And this concludes our presentation and we will now open for questions.

All right. Let's see if we have some questions. We have one question. How do you see dividend distributions from the NISA joint venture and Omega Sebsi going forward?

I think if we start with Omega Sebsi, it's a company that is delivering very solid results, but it's also a company that are in steep growth. So it will mainly be the organic growth of the company that will require capital the next, let's say, year or year and a half or so. And thereafter, the company will come into a dividend position, most likely. On the MISA, it's... It's a debt-free company. There will be, as it looks, solid utilization for the vessel going forward, and the company will come in a dividend position for sure going forward.

Thank you. And then, on the normal Maximus dry docking, for how long do you estimate that this dry docking will take? I will estimate around 60 days.

Okay, thank you.

And I think that concludes the questions for Solstice Offshore. Okay, so...

Thanks a lot for listening in everyone and I wish you all a nice summer ahead. Thank you very much.