SFL Corporation Ltd. Price & Performance (SFL)

You should therefore not place undue reliance on these forward looking statements. Please refer to our filings within the Securities and Exchange Commission for a more detailed discussion of risks and uncertainties, which may have a direct bearing on operating results and our financial condition. Then I will leave the word over to our CEO, Olie Arctaco, with highlights for the fourth Our business as a maritime infrastructure with a diversified team. We reported revenues of more than $230,000,000 this quarter, and the EBITDA equivalent cash flow in the quarter $132,000,000 which is significantly up from the second quarter. Over the last twelve months, the EBITDA equivalent has been $581,000,000 The net income came in at around $20,000,000 in the quarter, or $0.15 per share. And we had positive contribution relating to profit share on Capesize Bulkers and fuel cost savings of $2,500,000 Our fixed rate backlog stands at approximately $4,300,000,000 And importantly, two thirds of this is to customers with investment grade rating, giving us a unique cash flow visibility and resilience. This backlog figure excludes revenues from the vessels trading in the short [indiscernible] And also excludes revenue on the new dual fuel chemical carrier that operates in approved stock tankers.

It also excludes future profit share optionality which we have seen can contribute significantly to our net income. And in line with our commitment to return value to shareholders, we are paying a quarterly dividend of $0.27 per share or around 10% dividend yield. Most of our vessels are on long term charters and we have over the last ten years completely transformed the company's operating model making us relevant for large end users like Maersk, Volkswagen Group During the year, we renewed and extended multiple existing charters, and took delivery of nine new vessels in 2024. We also ordered five new large container vessels last year, which added $1,200,000,000 to our fixed rate charter backlog. And we are also in the process of upgrading several other vessels and our Chief Operating Officer, Trim Shirley, will talk more about that. It has also been a busy year from a financing perspective, where we have effectively addressed virtually all short term asset debt maturities, matching funding with charter tenure. In total, we raised $1,300,000,000 in financing including $220,000,000 in senior unsecured bonds in 2024. And subsequent to year end, we raised a new $150,000,000 senior unsecured bond loan in the Nordic market with maturity in 02/1930.

We have had a dispute with Seagrill for some time in connection with the condition of the drilling rig Hercules, it was redelivered to us in December 2022. Last week, there was a ruling in Oslo District Court where Sidewell was ordered to pay us approximately $48,000,000 in compensation including interest and legal costs. It was a comprehensive case with more than 80,000 pages of documentation and a ruling over 112 pages. This ruling is subject to appeal from both sides within a month of the judgment. We have so far not included any potential proceeds as an in our general administrative expenses, Separately, there is a case due to commence later in 2025 in connection with certain parts delivered to us by Seadrill in connection with a special survey of Hercules in twenty twenty three. We disagree on the actual ownership of some of the parts before they were delivered to us. And therefore also the compensation claimed by Seedler. It will most likely take several months before this fails is heard and there is a final ruling. And with that, I will leave the word over to our Chief Operating Officer, Thank you, Ula.

Our fleet currently contain 80 maritime assets. This includes vessels, rigs and contracted new buildings.

In 2024, we took delivery from shipyard of two LNG dual fuel PCTs and three LR2 tankers as well as purchased two dual fuel LNG 33,000 deadweight tonne stainless steel chemical tankers. We also, last year, placed orders for five sixteen thousand seven hundred TEU container ships in China, Also last year, we increased the backlog to Maersk with new five year charters for seven of our large container vessels which is a result of our close relationship and cooperation on vessel upgrades and performance enhancements. The first two vessels out of these seven have already been upgraded and were delivered to Maersk in Q1 This year, On divestments, we have sold one of our old 1,700 TEU [indiscernible] that was delivered to buyers in Q4. Also, Golden Ocean, the Chakra for our eight Cape size ball carriers, recently declared their purchase option for the eight vessels. We expect the vessels to be delivered to Golden Ocean early Q3 this year. Our backlog from owned and managed shipping assets does stands at $4,300,000,000 and the current fleet is made up of 15 drybulk vessels 38 containerships 18 tankers, two drilling rigs and seven car carriers.

We have a diversified fleet of assets chartered out to first class customers on mostly long term charters and majority of our customer base is large industrial end users. Container vessels remain our largest segment with almost 68% of the backlog.

As mentioned previously, by Ola, we have increasingly been investing in vessel maintenance and upgrades. From IMO and especially the EU, there are ever tightening regulatory requirements to reduce emissions from shipping, driving the need for continuous improvements. Such improvement and investing in assets is also critical clients by either providing new vessels to their service or by extending with our current fleet. We see that particularly the container operators are keen to see such partnership models developing with large upgrade projects, including Cargo Boost, energy saving devices, propeller modifications and even change to the hull form. Like new bulbous bow. We have identified major benefits from these investments, both in terms of cost saving for our customers, and lower emissions. In the fourth quarter, 96% of charter revenues from all assets came from time charter contracts and only 4% from bareboats or dry leases. Addition to fixed rate charter revenues, we have had significant contribution to cash flow from profit share arrangements over time, both relating to charter rates and cost savings on fuel. In Q4, profit split arrangements have contributed about $1,800,000 which is lower than a typical quarter due to lower fuel cost spread between heavy fuel oil and very low sulfur.

The charter revenue from our fleet was about $232,000,000 in Q4. We had a total of almost six thousand eight hundred operating days in the quarter, defined as calendar day less technical or fire and drydockings.

Eight vessels have been in drydock in the quarter, including major upgrade projects. Our overall utilization across the shipping fleet in Q4 was 98.3%, mainly due to the one hundred and eight days spent in drydock. For the rigs, the availability was about 67%. Mainly due to idle period for the Hercules rig. And on that, on the energy side, the Hercules rig was contracted with Equinor Canada until mid November. Including demobilization time to Norway. The rig is currently warm stacked and being marketed for opportunities later in 2025 and 2026. During the fourth quarter, rig recorded revenue of €34,000,000 and costs of approximately 26 Medium. Going forward, we expect the stacking costs of the rig to be considerably lower than those of [indiscernible] And for the liners, the rig recorded its first full operating quarter after its special periodic survey in May to July. And had Q4 revenue of $20,200,000 The Rigs market index rate increased 2.3% in the fourth quarter and costs were 13,000,000 in Q4 compared to 11,800,000.0 in the previous quarter. Subsequent to quarter end, we got a notification from our insurers that we will receive close to $5,000,000 to partly cover the expenses we incurred for the spot can repairs during the rig's yard stay last summer.

I will now give the word over to our CFO, Axel Wilson, who will take us through the financial highlights of Thank you, Mr. Schirly. On this slide, we have shown our pro form a illustrative stress of cash flows for the fourth quarter. Please note that this is on a guideline to assess the company's performance and is not in accordance with U. S. GAAP.

And also net of extraordinary and non cash items.

The company generated gross charter hire of approximately $232,000,000 during the fourth quarter with approximately $85,000,000 coming from our container fleet which was down from the previous quarter due to scheduled dry dockings and efficiency upgrades on some of our large container vessels.

This includes approximately 1,700,000.0 share related to fuel savings on seven of our large container vessels. In the fourth quarter, the company sold a 2,005 built [indiscernible] €10,800,000 and booked a gain of approximately $5,400,000 And subsequent to quarter end, the company has agreed to sell the sister vessel HNA of approximately $9,500,000 with expected delivery to the buyer in the second quarter of twenty twenty five after expiry of the current charter. The vessel is debt free and the gain of approximately $4,000,000 is expected to be recorded in the second quarter.

The car carrier fleet generated approximately $26,000,000 of gross charter hire in the quarter, including profit share from fuel savings, Our tanker fleet generated approximately €42,000,000 in gross charter hire up from approximately €37,000,000 in the previous quarter, as all five tankers acquired in 2024, Nava being delivered. SFL SFL shipped in drybulk vessels of which eight are employed on long term charters.

The vessels generated approximately €23,000,000 in gross charter hire in the fourth quarter including approximately $900,000 in profit share generated from our eight Cape Sides vessels on long term charters to Golden Ocean. The seven vessels employed in the spot and short term market contributed with approximately €7,400,000 in net charter revenue compared to approximately 8,400,000.0 in the third quarter. Subsequent to quarter end, Golden Ocean exercise is purchase option for eight Catas vessels for €112,000,000 in aggregate. The vessels will be redelivered to Golden Ocean during the third quarter of twenty twenty five and the net cash proceeds after repayment of debt is estimated to approximately $50,000,000 In the fourth quarter, our Energy assets generated approximately €55,000,000 in contract revenues, compared to approximately $86,000,000 in the third quarter as the Hercules finished its contract with Equinor in Canada in mid October. The line is under a long term contract with Konica Philips in Norway until May 2029. During the quarter, revenues from the rig was approximately $20,000,000 compared to $16,000,000 in the third quarter. Our operating and G and A expenses for the quarter was approximately $104,000,000 compared to approximately $99,000,000 in the third quarter mainly due to scheduled dry dockings and delivery of new vessels.

This summarizes to an adjusted EBITDA of approximately 132,000,000 compared to 167,000,000 in the previous quarter.

We then move on to the profits and loss statements as reported on The U. S. GAAP.

For the fourth quarter, we report total operating revenues according to U. S. GAAP of approximately $229,000,000 compared to approximately $255,000,000 in the previous quarter. The operating revenue decrease is primarily driven by the Hercules concluding its contract with Equinor Canada in mid October.

During the quarter, the company recorded profit share income for approximately €2,600,000 from fuel savings from some of our large container vessels, our car carrier and our eight Capesize Dry Bulk Vessels On Charter To Golden Ocean.

During the quarter, we had an increase in vessel operating expenses mainly due to scheduled drydockings and new vessel deliveries. Furthermore, results was impacted by non recurring and non cash items including a gain of approximately €5,400,000 in connection with the sale the feeder container vessel, Green Aids, a negative mark to market effect from swaps of approximately 2,000,000 Negative mark to market effects from equity investments of approximately $500,000 and a decrease in approximately $100,000 on credit loss provisions.

So overall, and according to U. S. GAAP, company report a net profit of approximately $20,000,000 or $0.15 per share compared to approximately $44,500,000 or $0.34 per share in the previous quarter. So moving on to the balance sheet. At quarter end, SFL had approximately SEK135 million of cash and cash equivalents.

Furthermore, the company had markedable securities of approximately 4,600,000.0 addition to debt free vessels it's an estimated market value of approximately 75,000,000. Dollars The company has recently concluded financing arrangements of approximately €1,000,000,000 with approximately $280,000,000 being drawn down during the quarter. During the fourth quarter, the company paid the second year installment of approximately 5% relating to the new billing order for five sixteen thousand eight hundred TEU container vessels with scheduled delivery in 2028. The remaining balance is due closer to delivery and expect this to be financed by pre and delivery loan facilities.

And subsequent to quarter end, the company successfully placed a new system in Mid Atlantic bond of €150,000,000 in the Nordic market in anticipation of new investments and general corporate purposes. And based on the Q4 numbers, the company had a book equity ratio of approximately 28%. Then to conclude, the Board has declared the eighty fourth consecutive cash dividend of $0.27 per share which represents a dividend yield of approximately 10%.

The company has a strong balance sheet and liquidity position and have effectively addressed the majority of all short term asset debt maturities matching funding with charter tenors. In total, we raised approximately $1,300,000,000 in financing, including two twenty million senior unsecured bonds. And subsequent to quarter end, we raised a new $115,000,000 senior secured bond in the Nordic market with maturity in 02/1930. Our fixed charter backlog currently stands at the 4,300,000,000.0 after adding approximately SEK2 billion during 2024. Two thirds of the backlog is the customers with investment grade rating, giving us strong visibility on our cash flow going forward.

And with that, I give the word back to the operator who will open the line for questions. Thank you, Arksam.

We'll now open for a question and answer session. For those of you who are following this presentation through Zoom, When your name is called out, please unmute your speaker to ask your question. We will have our first question from Gregory Lewis SFL Hey, thank you and good afternoon everybody and thanks for taking my questions. They actually had a fed a few today. The first is going to be around the semisubmersible rig got back to work, had a good year in 2024. I believe it's currently warm stacked outside of Norway. Was hoping you could kind of couple SFL questions around the Hercules. One is, how should we think about that OpEx cost as that rig is warm stacked off of Norway, and as we think about budgeting for 2025, or how are you thinking about budgeting that expense for 2025 just given some of the prospects that you're seeing for that rig, maybe as things start to warm up or the weather improves in the North Sea, as we kind of move in the summer. Thanks, Greg. The rig just concluded very successfully a drilling campaign in Canada for Equinor. This is a rig that is one of a handful of rigs that are capable of drilling you know, both in ultra deepwater and Welcome to SFL.

It has it has drilled in the Arctic you know, before and can do it again. So the issue right now is that that market is a little slow at the beginning of twenty twenty five. And we believe there are more prospect in the second half and onwards. So I would say if you talk to market analysts, they would say that 2026 looks very promising. So for now, we are keeping the ring idle. The reason why it is in the location where it is, is that it's very close to where it has a true edge. Also, we're taking the opportunity while it is idle now to do some upgrades for the rig, which makes it more attractive in the long run. So we don't risk having to take the rig out of business when it's working to do some upgrades that has to do with everything from, you know, the the the very latest drilling control systems. And frankly, many of the what they call six and seven generation rigs have the same issue, so we're dealing with it now beforehand. And also some other upgrades that we think would make the rig more attractive. We spent more than $100,000,000 on the rig in early twenty twenty three.

And that rig, we believe, is is very attractively positioned, but a very soft first quarter. Definitely or sorry, first half, I would say, So our expectation is not to that that rig will be back working until later in the year.

Okay, great. And then I did want to [indiscernible] appreciate the stability of the dividend it's kind of we look at, we went back and looked at, say, 2023, it looked like the dividend was really funded, call it, mid-forty percent payout of free cash flow. In 2024. That dipped down and kind of like a high 30s percentage of free cash, our operating cash flow payout As realizing that the dividend is a decision that the Board is always focused on and always thinking about. As we think about the stability of that dividend, how should we be thinking about that, I. E, hey, if we're in this range, there's we're in this kind of 30%, 40%, maybe even 50% payout of operating cash flow, the dividend is pretty should we expect it to be stable or asked another way what could trigger a decision to move the dividend higher or lower?

Yes, thanks. You're absolutely correct. The dividend is set on a quarter over quarter basis. So So we cannot guide specifically what will be next quarter dividend. But generally, I would say that the dividend discussions and the company and with the Board is more has more to do with the long term prospects. And if you look at the company's operating model, yes, we have we have this legacy asset. And frankly, I mean, the reason why we have this asset in the operating mode where it is is because it wasn't a bareboat charter, and our counterparty Seadrill failed. They went through two Chapter elevens and we ended up taking the rig back because that was the best solution for the company at the time. If you look at the generally, if you look at the rest of the business, you know, now we have two thirds of our backlog, which investment grade counterparties. I mean, that's a fundamental change in the business model. And we have more than 70 vessels. If you net out the Golden Ocean vessels, which will go out of their fleet in the third quarter. And frankly, [indiscernible] legacy assets. I mean, they are on an operating model where where we just more, I would say, more of a financial nature than an operatingator.

But if you look at the rest, it's all a long term business. It's all good Strayer Restruct Cardi parties. So we have a very stable cash flow fundament in the business. And yes, that drilling rig has had some very a lot of noise in the cash flow and even more noise in the net income. Because of U. S. Accounting rules where when the rig is mobile on you cannot recognize revenues even though you're compensated for revenues and then everything is piled up on top of the drilling days. So you have lower, higher, lower, higher, lower, higher revenue structures which creates a bit of a noise. But I think we should, yes, we are managing the rig. The rig is upgraded. We spent a lot of capital on it. We had this legal case that you may have noticed that where so far, Seadrill has been ordered to pay us a compensation To effectively compensate us for the cost we had back in 2023. But the rest of the model and the rest of the business is is quite stable and very predictable, I would say, in nature. So I would say it's sort of a we have the SFL model is a model, I would say, of, it's a tale of two decades, as you can call it.

It's from 02/2004 to 2014 ish, That's the financial structures, more bareboat type deals. And and from there onwards, we have switched the model more to an operating model where we basically run the vessels, we do repeat business, and typically with very strong carding parties.

So that's really what I can say. You know, it's difficult to be more specific Hercules.

We will market that rig. Of course, we are marketing that rig and we hope to find work for it, but we cannot be specific on on when on what exactly we are bidding. And and when exactly we can notify the market about contracts.

Okay. That was super helpful. I did have I did want to keep going. Go on. And I saw that You kind of were flagging and maybe that the the strength of your counterparties, maybe this quarter more than most, A question I've gotten a little bit this morning was around tariff And I don't think I think I know the answer to this, but as we think about as you built this container ship portfolio and even the car carrier portfolio. Obviously, it's I don't know if they're interesting or volatile. I don't know what the word is in the U. S. But regardless, these tariffs [indiscernible] people are reading about. The question that I've gotten a little bit this morning was around, and I think that people in shipping have seen this in in other industries around force majeure how certain things can create force majeures As we look at these car carriers and container ships, around tariffs, regardless of where these tariffs potentially go, I would think that that should provide no impact Existing charters, but I would if you could kind of clarify that or walk through any wrinkles I think that might be super helpful this morning.

Yes, thank you. I mean, if you look at the car carriers, we have, just to start with that, that are trading on The U. S. This is Volkswagen Group. It's a it's a very strong, you know, counterparty and they are our counterparty. So we could say, if there are any issues there, they will absorb that. And I think frankly, they have good economic capacity to do that. And but also I would like to add that when you look at the car trade as a market, yes, we have volumes going from Asia so far, sorry, from Europe to The U. S. But you also have a lot of volume going from The U. S. And back. So it's not like the car factories have they're producing all sorts of variations in each reflective market. They typically have a trade where the logistics on sea has been very effective for them. So the dilemma, it's, of course, that, if this this evolves, I mean, what then happens to the vehicles that are being produced locally in The U. S, for instance. And I think it's a little too early to tell and whether or not this is what we say a leverage to start to discussions at a different level SFL difficult to say.

But from our perspective, our counterparty is there is Volkswagen Group. So we don't think we are very exposed from that perspective. Same thing goes for the liner side. Our liner companies going there are there are, you know, Hapag Lloyd, Maersk line, MSC, we have very strong corner parties who've made a lot of money over the last few years. [indiscernible] you know, the trade between, say, China and The U. S. Has changed fundamentally since what we call the twenty eighteen-twenty nineteen trade war, if you can call it that, between US and China.

Where you at that point of time had around 10% of the volumes going from China to The U. S. And therefore had quite a bit of an impact. In the meantime, trade patterns have changed. And right now, China to U. S. Has diminished quite dramatically on the container line side. So you could say, yes, it has an impact, but it's much less than it was six, seven years ago. So we monitor this closely. But there at the same time, we have very strong counterparties. We are not directly exposed to that. This is our customers who are potentially exposed. And we are quite confident that they can easily service their charter rates to us.

Okay, super helpful guys. I actually see a hand raise, so I'll Thank you.

Thank you. Then we'll take our next question from Clement Molina Please unmute your speaker and ask your question, please.

Hi, good afternoon. Thank you for taking my questions.

You announced Golden Ocean will be exercising their purchase options on eight ks sizes.

As you think about redeploying the net proceeds, should we expect you to focus on dry book investments or are you willing to reduce your exposure to that sector?

Thank you. Generally, I would say, we are segment agnostics. So for us, it's all about doing the right deals with the right structure, with the right counterparties and with the right type of economics. We would love to do more in the drybulk space. And if we can find the right structure around that. And if you look at the segments that we're in, I mean, yes, we have liners. There we see significant interest from companies with a very logistics mindset. Ian, we would love to do the same, more of the same in the dry book sector. And we've done a few deal in the tanker segment. I would say the only segment where we are not press right now is LNG and that has more to do with with maybe as we see it, maybe a lot of players chasing deals in that segment and therefore That segment hasn't for us hasn't been attractive enough running yield perspective and a residual exposure after the charter period perspective. So we are, you know, we have not sort of allocated that capital for anything in particular or anything specific. It's all about deal by deal. And we monitor that these markets as we go.

But maybe also generally, I would say that if you look at that deal, that is one of our obviously, call it a legacy deal. It's sort of a it was has had more of a financial profile really than a true operating profile. And if you look at effective cash flow coming from those vessels, compared to the equity that we know get released. We believe that we can actually reinvest that with a better return than keep rolling that deal. So this is we are quite neutral to that. I mean, we would mind working with Gold Notion. That's been it's been working quite smoothly. But we also believe we can very effectively reinvest that capital in other assets and get at least as good return on the capital employed.

That's very helpful. Thank you.

I also wanted to ask about the Seedville award.

I'm guessing you cannot provide much commentary on the $48,000,000 ruling.

But should the ruling be appealed, when should we expect expect to hear from the next ruling?

This is Axel here. I mean, the ruling itself is public. So it's in Norwegian, so everybody can read that ruling. The timing for appeal is, it can appeal until the March 5. So we will then know if it's appealed. And then it will be moved on to call it the second circuit and that could potentially take up to another twelve months before that case is scheduled. So it could take some time still, yes.

Thanks for the color.

That's everything from me. Thank you for taking my questions.

Thank you. We'll take our next question from Belgae Yes, good afternoon, guys. A very quick one from me. Are there any significant upgrades or CapEx required to the Hercules if it were to work on offshore Norway?

Thank you.

Thanks. Not particularly. I mean, this rig has worked in Norway in the past. So it but that under another, call it, manager, So, you know, going back in with Oddfield Drilling, I would say, who is you know, maybe the premier operator on the Norwegian Continental Shelf Right? And We And Frankly Also We Took The Liners The Order Rig We Have, The Harsh Environment Checkup, That Was Also, You Know, Taken Into Norway and switched management from Seadrill to Oddfell Technology. So they're affected with a wider group. Was done in a very efficient manner. You know, we There are always some investments to be made, but we think compared to numbers we've seen from other settings, I think they're quite manageable. And typically, what you see when you bring rigs into Norway, the oil companies are generally willing to compensate the companies for the effective investments of taking them, you know, into that environment.

So we don't think that would be material. But there will be [indiscernible] is awarded, we will inform the market about what can we say, both the charter rates and mobilization fees and and investments required to get the job done effectively on it from a drilling perspective. All right. We have also received a question on the side here. Which shipping segment do you see as the most potentialprofitable SFL the next two to three years?

That's, you know, it's a difficult question. And the reason why it's difficult is that we don't focus on spot market. We focus on long term charters. And if you see the deals we've done, it's typically five, seven, ten year charters. So which means that we're not really exposed to the shorter market. So So spot market isn't so relevant. But if you look at new business development the sweet spot when we get deals done and we get, you know, a it's a setting where we have an attractive investment or entry point where we have a structure where our SFL customer [indiscernible] in the front end lose money, say, from day one. So hopefully, it's like the spot market, if that's where they're facing, is a little over. And then in the long run, you get to an effective cost of capital. We have over the years now built quite efficient funding structures for assets. We have funded ourselves, I would say, primarily in the Asian capital market. Where we have seen very attractive funding rates for long term charter structures with very strong counterparties. So we believe that we can structure deals that are quite attractive And that's why we are insulated from that perspective, from the short term market fluctuations.

And and that's sort of the nature of our business. But if you look at shipping in general, I would say that most shipping segments, in particular, if you look at the big volume shipping segments being dry bulk, which is the biggest tanker, smaller than dry bulk, but bigger than others. You have a very low order book, a historic low order book. Generally. So and you have, as significant reduction in shipping capacity and you also have structural issues like in Japan and Korea, where you have workforce issues, which could be making it difficult to keep up even also with the current reduced volumes of ship production.

So from that perspective, I think shipping is in a very interesting spot. Where you have true shortage of shipping capacity you've had an order book where you want if you order a ship today, and you or if you order a volume of ships, new builds, you will have to wait until 2029 You know, we're talking five four to five, at least four years to get these delivered. And historically, it's always been the ship owners who's doing it to the cells. Typically, ship owners as soon as you see some lightning in the market, ship owners would run out and order a lot of vessels to be put in the spot market and then when they get delivered, suddenly there are too many vessels and the ship and the charter rate collapse. To do that now, it will take a long time. So I think we've been in a very interesting spot from a supply perspective, at least. And then we just have to hope that the demand side is keeping up and China and Asia which is really where the volumes are going. There's so much noise about The U. S. And and and trade wars, but volumes from a shipping perspective is more Asia centric than US centric, I think, makes you know, maritime transportation quite attractive.

Thank you, Ola. We also have another question here. What's your view regarding the huge delivery backlog of containerships in the coming years? You think it will affect your profitability in 2026 and 2027 SFL?

Tim, Shirley speaking.

I think regarding the the backlog of containerships and any effect on SFL in 2026, 2027, we do not believe there will be a major impact to us. We our container fleet is mainly chartered out until sort of 02/1930 now or twenty twenty nine two thousand and thirty. And the vessels that are still open, we expect there is good interest in the market still And we see that there is a strong interest for for good and large container assets from all the operators still may sound surprising, but it's what we see. As our demand is still good. So [indiscernible] I mean, for us to look at the order book, as you call it, from from the big liners, there is definitely a demand there. So still. So as far as we can tell right now, we do not we do not see a big drop in the rates or definitely not in our profitability in the next four to five years based on our current backlog.

Thank you, Tom.

Then I would like to thank everyone for participating in this conference call.

If you have any follow-up questions to the management, there are contact details in the press release. Or you can get in touch with us through the contact pages on our webpage.

Www.sflcorp.com. You, everyone.