Solstad Maritime Asa

Good morning and welcome to the Solstad Maritime third quarter 2025 results presentation. My name is Lars-Peder Solstad, I'm the CEO of the company and I'm joined by CFO Kjetil Ramstad. After this presentation, we will open up for Q&A's and please ask questions in the chat and then keep in mind also that this is a Solstad Maritime presentation. So if you have any questions related to Solstad offshore, please wait until next presentation starting at 10 o'clock. We take a quick look at the disclaimer. before we move on to the quarter's business update and highlights. We had an adjusted EBITDA for the quarter of 69 million US dollars, down from 91 million in the third quarter last year. primarily due to lower fleet utilization in the second half of the year. This is in line with the trading update we gave 9th October, where we adjusted the full year 2025 EBITDA guidance to approximately $290 million. On the market update, we see that there's a long-term demand within offshore energy services that remains positive, with several new long-term opportunities and also project opportunities that we see in the market. However, on the short-term demand, we have experienced a lower demand than we previously expected. Having said that, we continued to sign new contracts and the order intake in the quarter reached 180 million US dollars and resulted in a book to bill ratio of 1.2 for the quarter. We signed some very important contracts in Australia where two of our anchor handlers are fixed for the majority of 2026, reducing the potential spot exposure. And we have in addition to that also reduced the spot exposure in the North Sea for the anchor handling fleet. from four vessels to two vessels lately by signing contracts in Brazil and in the Mediterranean. On the CSVs that we have with market exposures, they are all working on projects at the moment and it's likely that we will see them occupied with a decent utilization also going forward. And finally, I will also like to mention the contract that we signed and reported yesterday, which is not included in the Quartos book to bill, where we extended the contract for the large pipe laying vessel Norman Vision to the end of 2027 with Ocean Installer and where we also have mechanisms that can extend the contract into next decade. The fleet utilization in the quarter was somewhat lower than last year, as I mentioned, with 80% in this quarter compared to 89% last year. And if we look at the various segments, the anchor handling fleet came in at 76% and the CSV fleet at 81%. The board has also decided to distribute the cash dividend for the quarter of $0.032 USD per share, which is a total amount of $15 million for the quarter. If we take a closer look at the market, we see that we remain positive to the offshore energy market globally. and globally we have seen that the activity is good and it offers more opportunities. In 2025 it is the North Sea that has had lower activity than we previously expected and especially on the UK side the activity has been slow and has led to lower utilization for the CSVs and for the anchor handlers. Brazil continues to offer long-term and project opportunities for both segments, and the same goes for Guyana and also other regions where we operate. But we also have to keep in mind that the oil price development that we have seen the last month could introduce some uncertainty going forward. On the backlog, We had an order intake and a book to bill ratio of 1.2 in the quarter and 1.3 year to date. That is a strong order intake and increases the visibility into 2026 and beyond. We now have a firm backlog in Solstheim Maritime, close to $1 billion. And if we include the options, the number is close to $1.7 billion. And also worth mentioning is that the current backlog we have in Solstheim Maritime has an EBITDA margin of approximately 75%. So of the $960 million revenue backlog, the EBITDA backlog is more than $700 million. And also we have around $250 million of EBITDA booked for 2026, which gives us a solid foundation entering a new year in a couple of months. As also mentioned, we have reduced our spot exposure in the North Sea for anchor handlers and that now represents about 8% of total available days in 2026. There are also ongoing tendering activity for some of our CSVs that we have great expectations to, and that potentially could reduce available days in 26 further and add more to the backlog on the graph to the left. So by that, I leave it to you, Kjetil, to take us through some more details on the numbers.

Thank you Lars. If we start with the financial highlights for Solstrand Maritime for the third quarter. It has been a quarter with lower activity for the quarter. 80% utilization for the fleet compared to 89% last year. Year to date we have a utilization overall of 79%. The lower utilization for the year is mainly driven by large regulatory docking program for the fleet and in combination with lower commercial utilization. Revenue for the third quarter was 145 million dollars compared to 152 in third quarter last year. Year to date we are doing a little bit better than last year, $442 million compared to $419 last year Adjusted EBITDA was $69 million in third quarter compared to $91 million last year Year to date adjusted EBITDA also better than last year with 229 million dollars versus 220 million. The net result for the quarter was 32 million compared to 48 million last year. Firm backlog of $964 million compared to $755 million last year is an increase of approximately 30%. Book equity at the end of the quarter was $804 million, up from $696 million last year, giving an equity ratio of 48%. Adjusted net interest bearing debt was 580 million compared to 617 million last year. This gives a cash of 124 million at the end of the quarter compared to 214 million last year. As mentioned, the company will distribute approximately 15 million dollars in dividends for the third quarter. Then if we take a look at the net debt overview at the right hand side in the graph, we see that the fleet loan of $686 million per the third quarter. And if we adjust for the accrued interest and the cash, we have adjusted net interest bearing debt of $580 million. And then if we then adjust also and include the leases, we will get the net interest bearing debt of $608 million. And at the bottom you see the amortization schedule. See that we will repay $65 million in December this year. And then we will repay $131 million in 26 before majority first quarter 27. So if we go to the updated financial guiding, we refer to the stock exchange message on 9th of October 2025. Then we gave the market an update on the adjusted EBITDA guiding. So the full year adjusted EBITDA guidance is at approximately 290 million dollars. The tax payable is unchanged. The capex guidance we narrowed down to 115 to 125. with maintenance at 95 to 100 and investments to 20 to 25 million dollars. The net interest and amortization is unchanged in the guiding. Then if we go to the key dividend dates, there is a proposal to pay dividend for the third quarter of US dollar 0.032 dollar per share, approximately 15 million dollars. to be paid in NOC. And the key dates is that the last day to receive dividend is 7th of November, the X date is 10th of November, record date 11th of November, and then distribution date under about 13th of November. So with that, I leave the floor to you, Lars-Peder, to summarize.

Thank you Kjetil. As mentioned, the quarter has been influenced by a lower utilization for the CSV and the anchor handling fleet. This said, the tendering activity we see for 26 and onwards remains at a high level. indicating several longer term and project opportunity, especially for the CSV fleet. But there are also some interesting opportunities, especially project related, also to the anchor handling fleet. But the fact that the oil price development has been as it has the recent month, we cannot ignore that fact. And that could be a source for uncertainty going forward that we have to take into consideration. And even if we have a disappointed earnings in third quarter, as we have discussed here already, we see that the order intake remains strong. $180 million in the quarter, which is a 1.2 book to bill, is quite good. And that also goes for the year in total, where we are at 1.3. which increases the visibility into 2026. And also we have $250 million already booked in EBITDA for 2026. And if you remember the guidance we have for 25 of $290 million, it gives a picture of that we are entering an okay year for the company into 2026. and we continue to pay quarterly dividends, this time a total amount of $15 million for the quarter. So by that we end our presentation and we move over to Q&A's and let's see if there are any questions, Kjetil.

Yep. We can start with the first question. Is there a step up in rate for the Norman vision extensions?

We didn't report that rate, but it's fixed on a healthy level, I would say, but also keeping in mind that this is a contract that has been going on for many years, but we are very pleased with the rate that we managed to get for the extension. And there are also some mechanisms that could make that contract to a longer firm period, as I also mentioned. It's a good contract.

Thank you. And next question, could you please give some more detail on the current tender activity that you mentioned for the CSVs? Which one do you have great expectations for and which regions is it related to?

Well, of course, if you look at our fleet, the main, let's say, focus we have to secure longer term utilization on is mainly on the Norman Sentinel and Navigator and Jarstein and also the Norman Cutter and on all those vessels we have interesting discussions going on in various parts of the world. Some are project related and some has a longer duration. That is ongoing discussions, and let's see how that goes.

Thank you. And then the next question, can you provide some comments on the market balance for the 150 to 250 ton crane vessel in the CSV segment, given the new builds that are coming to market 26 and onwards?

Well, there are no doubt that there are more competition in the market already. Others, in addition to us, has availability, so it's a more competitive market already. It's also a fact, as the question indicates, that there are vessels coming to the market mainly from 27 and onwards, a few also in 26, and we are dependent on a higher activity level in the market. so that those additions to the fleet can be absorbed in a good way. So as I said, there are tender activity in the market. How that balances out remains to be seen.

Then we go to the next questions. There are seven to eight CSVs in the fleet of contract from now until second quarter 26. What can you say about strategies and plans to secure work short term for these vessels?

I think I already answered that question. We have a very strong focus on securing high utilization on our fleet, including the vessels mentioned, and that has a strong focus. And as I said, there are several opportunities that we are chasing and we're quite optimistic to be able to take our fair share of those opportunities.

Sigma is arriving soon in Brazil and Sirius will be mobilizing also. What is the timing for those vessels to start working for Petrobras?

As you will probably remember from the update we gave the 9th October, we also said that Petrobras has asked us to deliver earlier than originally planned. That also has a negative consequence of fourth quarter as we are doing the mobilization and also some of the spendings in fourth quarter. but we expect to be on higher with one of the anchor handlers in Brazil in January and the other one in February next year.

Then it's a question on Capex. Capex is almost double this year compared to 2023 and 2024. Can you help us understand how this will look like in 2026?

First of all, 2025 has been an extraordinary year when it comes to capex and dry docking. We have had many main classes on some of the more bigger and advanced vessels with the cost associated with that. into 2026, we have much less planned dry dockings. So you will see a capex level on a completely different level in 2026 compared to what we have had in 2025.

Thank you. And then there are several questions on the upcoming refinancing, so I can just share some thoughts on that. We will of course discuss with the lender group in the fleet loan of Solstrand Maritime when appropriate and let the market know the outcome when those discussions are finalized. And then next question, and it's a little bit the same, but can you give an update on the current subsidy contracts and pricing? How do you see the market develop into 2026?

I think I covered most of it. On the rate level, of course, the higher competition, the more pressure on the day rates. But what we have seen so far is that the rate level has been still on a decent level. And What we see from discussions we have with clients and so on, as well as that it looks like the rate levels will continue to be on a quite okay level also going into next year.

Thank you. A lot of questions today. One about Petrobras. There has been some comments recently about Petrobras contacting suppliers to discuss how they together can cut costs. Have Solstad seen any of these requests?

Yeah, we have had our meetings as well. And to me, it's very constructive discussions. It's about, are there anything we in common can do? And I would say, yeah, the discussions has been very constructive and sort of no no red light at all. So we are a very large client of Petrobras and have fruitful discussions, I would say, with them. So that's what I can mention on that subject.

Thank you. That was the last question.

Okay, so then thank you very much for listening in and have a nice day ahead. Thank you.